ELAINE D. KAPLAN, Judge.
This rails-to-trails case is currently before the Court on Plaintiffs' Motion for Payment of Attorney Fees and Litigation Expenses. In accordance with the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, 42 U.S.C. § 4654(c) (URA), Plaintiffs request an award of $1,072,455.40 in attorneys' fees and $95,668.81 for expenses incurred in connection with this litigation. The government opposes Plaintiffs' motion, contending that the number of hours claimed and the hourly rates charged are excessive. It also contends that several of Plaintiffs' claimed expenses are unreasonable and should be disallowed.
For the reasons set forth below, the Court concludes that Plaintiffs are entitled to an award of attorneys' fees in the amount of $523,786.98 and reimbursement for expenses in the amount of $69,098.83. Accordingly, Plaintiffs' motion is
This rails-to-trails takings case involves properties abutting a 2.91-mile railroad right-of-way in Lafayette County, Missouri. Compl. at 1, ECF No. 1. Those properties became the subject of a Notice of Interim Trail Use issued by the Surface Transportation Board in 2012.
The parties filed a stipulation regarding title matters on July 1, 2016, and a revised stipulation on July 29, 2016. ECF Nos. 17, 20. Several weeks later, on August 19, 2016, they reported to the Court that they had resolved all liability matters through the stipulation. ECF No. 24. Based on the stipulation, Plaintiffs subsequently voluntarily dismissed thirteen claims asserted by twelve of the twenty-two landowners (including the claims asserted by the original plaintiff property owners, the Bratchers and Michael Slaughter). ECF Nos. 37 and 38.
In the meantime, on August 26, 2016, the Court issued a pre-trial order to govern the valuation stage of the case. ECF No. 27. The parties thereafter engaged in discovery and a trial date was set.
On August 14, 2017, Plaintiffs filed a notice of acceptance of the government's Rule 68 offer of judgment. See Landowners' Notice of Acceptance of Gov't's Rule 68 Offer of J., ECF No. 81. The offer Plaintiffs accepted included a total principal amount of $77,466.80, covering fourteen claims made by a total of eleven property owners.
On September 1, 2017, Plaintiffs filed the present motion for an award of attorneys' fees and expenses. ECF No. 86. The government filed its opposition on October 13, 2017, ECF No. 97, and Plaintiffs replied on October 27, 2017, ECF No. 100.
Judge Bruggink, to whom this case was then assigned, set argument on Plaintiffs' motion for January 8, 2018. Prior to that date, however, Judge Bruggink determined that a declaration filed by Plaintiffs with their reply brief had created a ground for his disqualification under 28 U.S.C. § 455(a). See Order, ECF No. 105. Accordingly, Judge Bruggink transferred the matter to the undersigned by order of January 12, 2018.
That same day, Plaintiffs filed a motion seeking an order requiring the parties to engage in mediation regarding Plaintiffs' attorney fee request. ECF No. 106. The government opposed the motion, ECF No. 108, and the Court denied it on January 25, 2018, ECF No. 112.
The Court held oral argument on Plaintiffs' motion for an award of attorneys' fees on February 13, 2018.
The URA's attorney fee provision provides, in pertinent part, that:
42 U.S.C. § 4654(c). The government does not dispute that Plaintiffs are entitled to an award of reasonable attorneys' fees and expenses for services performed in connection with the claims that were the subject of its offer of judgment.
"In determining the amount of reasonable attorneys' fees under federal fee-shifting statutes, the Supreme Court has consistently upheld the lodestar calculation as the `guiding light of [its] fee-shifting jurisprudence.'"
The court of appeals has adopted the "forum rule" to identify the "relevant community" that serves as the basis for determining a reasonable hourly rate.
The Federal Circuit, however, has recognized a "limited exception" to the forum rule in cases where the bulk of the work in the case is performed outside of the forum and where there is a "very significant" difference between the forum rate and the local rate.
Plaintiffs bear the burden of proving that the number of hours submitted for payment is reasonable and does not include hours that are "excessive, redundant, or otherwise unnecessary." Hensley, 461 U.S. at 434. In this case, Plaintiffs claim that counsel and support staff spent more than 1,900 hours on the litigation, an expenditure that they argue "was reasonable and necessary — especially given the government's aggressive opposition." Landowners' Mem. in Supp. of Mot. for Payment of Att'y Fees & Litigation Expenses (Pls.' Mem.) at 1, ECF No. 86-1.
The government challenges the number of hours for which Plaintiffs seek attorneys' fees on a number of bases, claiming: 1) that Plaintiffs have included hours attributable to claims which they agreed to dismiss and on which they accordingly did not prevail; 2) that Plaintiffs have claimed reimbursement for time spent on client solicitation and business development activities; 3) that Plaintiffs are not entitled to recover fees associated with what the government calls a "deficient deposition notice and subpoena" that was served on a third party; 4) that Plaintiffs are not entitled to fees for billings the government characterizes as "questionable" and attributable to attorneys "who have not appeared in the case"; 5) that Plaintiffs are not permitted to seek fees for 100% of the time spent in travel; 6) that time spent on assorted other matters is not compensable; 7) that the fee request attributable to certain legal services is excessive given counsel's expertise; and 8) that fees for time spent preparing the motion for fees must be reduced. Each of these objections is addressed below.
In the context of fee-shifting statutes like the URA, hours spent on unsuccessful claims should be excluded from the lodestar amount where the claim or claims on which a plaintiff failed to prevail is "distinct in all respects from his successful claims."
Plaintiffs' time records do not specify the claims or parcels of property to which the recorded hours pertain. Consistent with the approaches taken in similar cases, the Court will account for the time attributable to the unsuccessful claims by applying a percentage reduction to certain of the hours claimed.
Thus, as noted above, in a July 29, 2016 stipulation, the parties agreed that approximately 50% of the claims contained in the Amended Complaint should be dismissed. Recognizing, however, that the unsuccessful claims may have had issues that overlapped with the successful ones, the Court will disallow 40% rather than 50% of the hours claimed for work performed up through July 29, 2016. See Biery III, 818 F.3d at 712 (affirming CFC decision which— recognizing overlap—reduced hours by 30% where Plaintiffs did not prevail on 40% of their claims). This reduction will be applied after taking into consideration the other reductions described below.
The government contends that the Court should eliminate sixty-eight hours of the time claimed by Plaintiffs that it characterizes as "client solicitation" and "business development" activities. See Def.'s Resp. at 14-15. In particular, it challenges Plaintiffs' request for fees for time spent by counsel and paralegals preparing for and attending meetings with local landowners during the months that preceded the filing of the Amended Complaint in January 2016.
The Court rejects the government's characterization of these meetings as "solicitation" or "business development" activities. Rather, these meetings were apparently held to engage in substantive discussions with individuals who had property interests in the land that abutted the railroad corridor. These individuals were presumably already interested in retaining counsel (at least for purposes of determining whether they had claims), and the meetings themselves were consultations with counsel. The research and discussions that occurred before, during, and after these meetings served as the basis for the amended complaint that Plaintiffs filed in January 2016. The Court, accordingly, rejects the government's categorical objection to the compensability of these hours.
The government asks that the Court cut 43.6 hours counsel billed for work attributable to a motion to quash that Union Pacific Railroad filed in response to a deposition notice that Plaintiffs filed. See Def.'s Resp. at 15-17. Plaintiffs noticed the deposition after the government preliminarily identified as one of its witnesses a "[r]epresentative of Union Pacific Railroad with knowledge about trail use negotiations with [the] City of Lexington."
According to the government, Plaintiffs should not recover attorneys' fees for any of the work in connection with the notice of deposition or motion to quash. It argues that "[t]he bottom line is that Plaintiffs generated unnecessary fees and costs by issuing and later withdrawing a deposition notice and subpoena that was deficient for several reasons, none of which were caused by the United States." Def.'s Resp. at 16. The Court disagrees. Once the government identified a representative of Union Pacific as a potential witness, it was reasonable for Plaintiffs to seek the opportunity to depose that witness. Further, Plaintiffs did not withdraw their notice of deposition because it was "deficient"; indeed, by the time of the status conference on May 15, the alleged deficiencies (i.e., the failure to identify the name of the witness or tender the witness fee) had been cured. Rather, Plaintiffs withdrew their notice because the government agreed to reconsider whether it was necessary to call a witness from Union Pacific at all. Thus, Plaintiffs' efforts had the desired effect of precluding the government from calling a witness whom Plaintiff had not had the opportunity to depose. The government's objection to Plaintiffs' recovery of fees in connection with this work lacks merit.
The government seeks a reduction of 34.9 attorney hours for what it characterizes as "questionable billings." Id. at 17-19. First, it contends that Plaintiffs failed to establish the reasonableness of the 11.4 hours of time billed by Debra Albin-Riley, an Arent Fox partner.
The government also challenges 18.9 hours of time billed by counsel Meghan S. Largent, contending that the vast majority of the work done involved reviewing filings or attending meetings, which the government argues is duplicative of the work performed by other attorneys in the case. Def.'s Resp. at 18. In a declaration submitted with Plaintiffs' reply, Ms. Largent states that she performed substantive work in this case that was necessary for Plaintiffs to prevail, including participation in client meetings and work on pleadings filed in the case. Decl. of Meghan S. Largent (Largent Decl.) ¶ 2, ECF No. 100-3.
The Court concludes that it was not unreasonable for Ms. Largent to bill time to attend client meetings in Lexington, Missouri on October 20, 2015, along with Ms. Brinton. It was not unreasonable for the firm to assign two attorneys to attend the meetings because there were multiple prospective plaintiffs. Ms. Largent's other entries involve brief periods of time to perform a review of pleadings and orders, to discuss discrete legal issues and other matters, to conduct specific research tasks, and to attend meetings with the litigation team to discuss strategy. The Court concludes that these entries also appear reasonable.
Finally, the Court rejects the government's challenge to the 4.6 hours Plaintiffs have billed for the services of attorney Donna Mo, a senior associate who conducted a discrete research project concerning appraisal issues. See Def.'s Resp. at 18-19. The government's objection to this entry appears to be based on the facts that Ms. Mo is in another practice group (Labor and Employment) and that her claimed billing rate is $665 per hour. The government's objection to the relatively modest number of hours claimed for this discrete research project is unpersuasive. The Court addresses the reasonableness of Ms. Mo's claimed hourly rate below.
The government contends that any time that counsel billed for travel should be reduced by at least 50%. Id. at 19-20. As the court of appeals has noted, however, "[w]hen a lawyer travels for one client he incurs an opportunity cost that is equal to the fee he would have charged that or another client if he had not been traveling."
In this case, a good portion of the time for which travel was billed involved trips by automobile within the State of Missouri. Because it would not have been possible to also perform case-related work during these trips, that time is fully compensable.
On the other hand, the timesheets also include entries from Ms. Brinton and Mr. Davis which appear to involve airline travel to attend depositions in Flint, Michigan; Madison, Wisconsin; and Denver, Colorado. Ms. Brinton specified in two instances that she performed work on the case while on the plane, noting in an entry for July 6, 2017, that she "review[ed] notes and exhibits on plane" and in an entry for July 10, 2017, that she "review[ed] notes during travel." Landowners' Mot. for Att'y Fees & Expenses Under the URA & Local Rule 54(d) (Pls.' Mot.) Ex. 1 at 22-23, ECF No. 86-2.
The government also challenges Plaintiffs' request for fees for approximately 2.3 hours of time that appears to have been spent reviewing files in other cases. Def.'s Resp. at 20 (challenging entries from October 5, 2015, and December 23, 2015). The Court agrees that Plaintiffs have failed to explain the relevance of this work to this case. Accordingly it rejects these hours.
The government objects to time billed in relation to FOIA requests made by Plaintiffs requesting information about the number of hours that Justice Department attorneys put in on this case. Id. at 20-21. The Court is not persuaded by the government's argument that such time is not reimbursable because Plaintiffs had the option of seeking discovery of the documents it requested. While counsel may not double-bill by using FOIA to secure documents that have already been received through discovery, it is not unreasonable for them to employ other information-gathering techniques, including FOIA requests, as a means of building Plaintiffs' case.
The government challenges Plaintiffs' request for compensation attributable to certain time billed by paralegals for performing what the government characterizes as essentially secretarial tasks.
The tasks which the government identifies as non-compensable are those characterized in the timesheets with descriptions such as "reviewing and managing client data" or working on "landowner access to pleadings."
The government also objects to what it claims was excessive time (59.5 hours) spent by Plaintiffs' counsel researching issues relevant to the Federal Circuit's consideration of and ruling in
The Court agrees with the government, however, that the amount of time billed by counsel for research related to these issues is excessive, given their extensive experience in rails-to-trails cases and the fact that counsel were already intimately familiar with the issues raised in Caquelin (having filed an amicus brief in that case and written extensively regarding its implications in other rails-to-trails cases). Accordingly, the hours billed for attorney time expended on these issues shall be reduced by 50%.
Finally, the government challenges as unreasonable the more than 100 hours counsel claim was spent preparing their motion for fees.
According to lead counsel in this case, Mark Hearne, the fees Plaintiffs request were calculated on the basis of the hourly rates that Arent Fox charges paying clients in the Washington, DC market for similar services. Those hourly rates, as back-calculated on the basis of counsel's billing records, are as follows:
In addition, Plaintiffs claim hourly rates ranging between $210-$355 for the services of paralegals, as well as $190-$205 per hour for work by certain "project assistants."
According to Mr. Hearne, the rates charged by Arent Fox "are established and reviewed annually" and are "based upon substantial analysis and research of the legal marketplace." Hearne Decl. ¶ 38. "Among other factors," Mr. Hearne states, "the firm considers, (a) the prevailing hourly rates charged by our peer firms for comparable work by attorneys possessing comparable skill and experience, (b) surveys of AmLaw 200 law firm billing rates prepared by Price WaterhouseCoopers and the
The government argues that Plaintiffs are not entitled to recover their fees at forum rates because counsel performed the bulk of the work in this case outside of Washington, DC, and because there is a significant difference between the forum rates and the prevailing market rate for legal services in St. Louis, Missouri, where Plaintiffs' counsel practice.
Plaintiffs do not meaningfully contest that the bulk of the work in this case was performed outside of Washington, DC.
Plaintiffs' argument that the
Plaintiffs contend that the government has failed to establish that prevailing local rates in St. Louis are substantially lower than the Washington, DC rates that they seek. The Court notes that Plaintiffs have supplied no evidence of their own regarding prevailing rates in St. Louis, Missouri. In another rails-to-trails case involving the same counsel, however, Judge Firestone concluded on the basis of data drawn from one of the plaintiffs' own affiants that (at least in 2012) rates in St. Louis were significantly lower than rates in DC.
Further, in another recent decision by Judge Firestone in a rails-to-trails case, she found that a reasonable hourly rate for partners practicing in the St. Louis market is $475, for associates, $275, and for paralegals, $150-$175.
In
Both the rails-to-trails case (
Nonetheless, the Court is also cognizant of the attorney rate ranges and average rates set forth in the Missouri Lawyers Weekly 2016 survey, see ECF No. 97-10, which are consistent with the fee awards in
As is readily apparent, these rates are substantially lower (close to one-half) of the forum rates Plaintiffs claim, which the Court will assume are reasonable for purposes of making the Avera comparison. Accordingly, under Avera, the Court will award fees to Plaintiffs at the aforementioned St. Louis rates.
As described in the table below, with the foregoing deductions, the Court awards Plaintiffs fees in the amount of
Under the URA, Plaintiffs are entitled to reimbursement of reasonable costs actually incurred in connection with this case. Such expenses must, of course, be "reasonable and necessary."
Plaintiffs have requested reimbursement of $95,668.91 in expenses. Pls.' Mot. Ex. 1 at 41. As with their attorneys' fees claim, Plaintiffs have not identified which expenses were associated with unsuccessful claims. Accordingly, the Court will reduce by 40% those expenses incurred through July 29, 2016.
The government has also challenged as insufficiently documented and/or unjustified the expenses Plaintiffs have claimed for Federal Express shipments. Def.'s Resp. at 39. The Court agrees with the government that the over 100 Federal Express charges Plaintiffs have billed are not accompanied by explanations that would allow the Court to determine what documents were transmitted and to whom, and whether the use of the expedited delivery service was reasonable or necessary, as opposed to merely convenient for counsel. Accordingly, the charges are disallowed.
The Court also agrees with the government that Plaintiffs have failed to sufficiently justify reimbursement of the itemized charges they have claimed for Westlaw research. See Def.'s Resp. at 39. Nothing in the record indicates that counsel is charged by Westlaw on a session-by-session basis. The Court's understanding is that "many firms pay a flat rate to Lexis and Westlaw regardless of their usage."
The Court, however, rejects the government's argument that it was unreasonable for Plaintiffs to pay their mapping expert premium rates in connection with his deposition testimony. See Def.'s Resp. Ex. 5 at 7, ECF No. 97-5. It similarly rejects the government's challenge to the reasonableness of certain rental car rates.
The Court agrees that—absent adequate justification—it is not reasonable for counsel to charge for upgrades of standard coach seats on airlines. The $596 charge for a first class upgrade to Ms. Brinton's flight from Minneapolis to St. Louis on July 6, 2017, is accordingly unreasonable.
Finally, Plaintiffs request reimbursement of $11,015.38 for a fee that the Westin Hotel in St. Louis apparently charged them for the cancellation of a conference room rental for the week of the planned trial.
As described in the table below, with the foregoing deductions, the Court awards Plaintiffs expenses in the amount of
For the foregoing reasons, Plaintiffs' motion for attorneys' fees and expenses is
The parties shall file a joint status report no later than March 23, 2018, identifying any further steps that must be taken before final judgment may be entered in the case.