Southern District of N.Y Applies a 70% Reduction to a Fee Request submitted at $4.3 million
Posted on August 31st, 2017 by Legal Fee Advisors
By Emily Wilson, contributions by Jillian Robbins and Erisa Qyra.
A significant reduction to a fee award in a Southern District of New York case, Schoolcraft v. City of New York, demonstrates the importance of efficient billing practices. The case was brought by a police officer against the City in regards to alleged violations of the First and Fourth Amendments, with the police officer prevailing and subsequently seeking an award of fees and costs. While the Court agreed that the litigation was complex and demanded “a great deal of effort from counsel over a long period of time,” the attorney rates sought by the Plaintiff were deemed excessive by the Court. In addition to excessive rates, the Court held that a fee reduction was necessary, finding many other issues with the attorneys’ fee request.
The Court determined that the “rates are not equivalent to what ‘a reasonable, paying client, who wishes to pay the least amount necessary to litigate the case effectively’ would be willing to bear in this District.” Taking this factor into consideration, the Court determined that although a rate of $100 was “generally” appropriate for paralegals in small firms, counsel had failed to establish the “applicable experience” of some of their paralegals and as such, the Court reduced the paralegal rates by 20% to bring them in line with market rates. Further, the Court applied a 25% reduction to the requested attorney rates and a 30% reduction to a law clerk rate. While the Court initially determined that a 35% reduction in attorney rates would be appropriate, the Court modified its order in March of 2017 when it acknowledged that in its initial opposition, the defendants conceded that a 25% reduction on this basis would be reasonable.
Counsels’ billing practices were also found to create inefficiencies and duplication of work. The Court held that the contributions of two partners were duplicative in that one partner “appeared to be in aid” of the other, “rather than commensurate”. The Court reasoned that even if a partner has “exceptional experience,” a “reasonable client would not pay for duplicative work, or partner rates for work that could be performed by an associate.” The Court further held that the work of eight attorneys on the case was excessive and resulted in “an unreasonable use of time.” For example, counsel attended 38 depositions in teams of two or three, resulting in 1,443 hours being recorded for these tasks alone. Counsel was also found by the Court to routinely bill for “set charges” such as multiple entries of 0.1 for “mundane tasks” such as emailing a document and receiving a notice of appearance. The Court applied an additional 10% reduction to account for the set charges and vague entries. Further, plaintiff’s counsel billed for non-compensable tasks including media, public relations and administrative matters. Accordingly, the Court applied another 3% reduction to account for this inefficiency.
Despite the Court identifying the level of effort given by counsel and lengthy nature of the case, the Court held that the 8,830.35 hours of time requested by counsel was “facially disproportionate” to other litigations, comparing it to another similar litigation where 2,385 hours was deemed excessive. The Court applied a 35% reduction to account for the unreasonable time that was expended.
Ultimately, out of the requested $4,260,564.70 in attorney’s fees and costs, the Court made a reduction of approximately 70% in March 2017. This case demonstrates that attorneys are expected to effectively and efficiently represent their clients at reasonable costs that are in line with market rates. Courts will also make significant fee reductions where there are billing inefficiencies such as excessive hours, duplication of effort, vague and “difficult to decipher entries”, as well as other non- compensable tasks.
Schoolcraft v. City of N.Y., No. 10 CIV. 6005 (RWS), 2016 WL 4626568 (S.D.N.Y. Sept. 6, 2016), modified on reconsideration, No. 10 CIV. 6005, 2017 WL 1194703 (S.D.N.Y. Mar. 31, 2017).
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