haircut-33187_640The City of Minneapolis battled with a plaintiff in a civil rights case, negotiated a settlement and included in the settlement an offer to pay the plaintiff’s lawyer, $49,999. The plaintiff’s lawyer would not agree to accept anything less than $52,088.50.  So they went before U.S. District Court Judge Patrick J. Schiltz (D. Minn.) to resolve their differences.

You might think that Judge Schiltz would award $52,088.50 or $49,999 or some amount in between.

You would be wrong.

Apparently, everyone in the case found the amount of time that plaintiff’s counsel spent on the case to be accurate and “eminently reasonable.” But Judge Schiltz held that a reasonable hourly rate for the plaintiff’s lawyer, Joshua Willliams, was $335, rather than the $300 per hour proposed by the City of Minneapolis or $400 per hour proposed by Williams. Further, Judge Schiltz held that some of Mr. Williams’ work, as a solo lawyer, was administrative work — work normally delegated to a paralegal, who would be billed out at a larger firm at a lower hourly rate — not entitled to compensation at Williams’ hourly rate.

Based on the Court’s analysis, it concluded that plaintiff’s counsel would only recover $42,600.50 in “reasonable attorneys’ fees” and costs.

In my view, the decision is wrong and disappointing.

First, Judge Schiltz chides both sides in the opinion for failing to bridge the $2,000 gap. But he seems to overlook that, on one side of the case is the City of Minneapolis and on the other side, a solo lawyer. As between the two, who is more blameworthy for failing to compromise? For whom is $2,000 a relatively lower amount of money? As between the two, the salaried civil servants are more responsible for this inefficient squabbling than the solo lawyer. The solo lawyer’s fight is not just for his fees in this case but for the precedent that this case will have on his future cases. Of course all of us, the tax payers and citizens, bankroll the stubbornness of the City Attorney in this $2,000 tussle. At least the Court gives the plaintiff’s lawyer credit for not seeking fees for the fee fight in his fee petition (footnote 1). In addition, what’s with the City’s $49,999 proposal? Does it not appear to be childish gamesmanship for the City of Minneapolis to propose settlement $1.00 short of $50,000 and to wage a costly fight over the $2,000 difference?

Also, if Judge Schiltz wants to deter litigants from spending more than $2,000 to fight over a difference of $2,000, what kind of message does he send by deviating from the parties’ own positions and down-grading the fee award below the City’s offer? By deviating downward from the parties’ own negotiations, he has increased the likelihood that such substanceless impasses will drain judicial resources in the future, precisely the opposite of what he should do. (Imagine what kind of incentive he would create for plaintiff’s lawyers if he deviated OVER the plaintiff’s lawyers’ position.)

Second, the idea Judge Schiltz deems an hourly rate of $335 “reasonable” and, implicitly, finding both $300/hr. and $400/hr. “unreasonable” is ridiculous on its face. A “market rate” by definition is a range.

On the same point, Judge Schiltz presumably would want to discourage litigants whenever possible from forcing the Court to step in and set “market rates” for lawyers, because it raises a host of concerns. By setting Mr. Williams’ “reasonably hourly rate” at $335 rather than $400, Judge Schiltz has damaged Mr. Williams’ interests in this case. The Court may also have damaged Williams in later cases in which, after assuming financial risk on behalf of his clients, Mr. Williams prevails, only to see his hourly rate anchored to the Court’s $335/hour rate based on the Court’s “own knowledge of the prevailing rates in the Twin Cities legal market (which have been somewhat stagnant in recent years due to the poor legal economy).”

Further, the discounting of a solo lawyer’s time due to the solo lawyer’s lack of administrative staff is, in my view, unwise. First, teasing out when a lawyer’s work is administrative and when it is lawyering is extremely subjective. Second, lawyers’ hourly rates are proxies for the lawyers’ value. They are obviously and importantly approximate. One cannot realistically time lawyers’ work to the minute. Note that Mr. Williams, a solo lawyer, was unable to seek any fee award for the time-consuming fee fight that the City of Minneapolis inflicted on him. How does the Court propose reconciling that in favor of the solo lawyer as the Court uses the solo lawyer’s lack of administrative support against the solo lawyer?

Finally, in defense of Judge Schiltz’s analysis, the law sets out a procedure for decision such fee-award disputes and I have absolutely no doubt that Judge Schiltz followed the procedures carefully and faithfully. The Court did its job as fee umpire, calling the balls and strikes in good faith. I concede that, as wrongheaded and harmful as this ruling seems to me, my beef may be with our court’s fee award procedure rather than its application in this case. On the other hand, another role that umpires play in baseball is deciding when it makes sense to order game forfeited when a team “employs tactics palpably designed to delay….the game” and the City’s $5,000+ of attorney time to fight over a $2,000 difference seems to qualify as such a tactic to me.

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