BERYL A. HOWELL, United States District Judge.
Pending before the Court is the plaintiff's Motion for Attorneys' Fees and Costs ("Pl.'s Mot."), ECF No. 44. The plaintiff, the Electronic Privacy Information Center ("EPIC"), seeks attorneys' fees as a prevailing party pursuant to the Freedom of Information Act ("FOIA"). 5 U.S.C. § 552(a)(4)(E). The defendant, the National Security Agency ("NSA"), challenges
The facts of this case have been set forth in this Court's prior Memorandum Opinion and do not need to be repeated here. See EPIC v. NSA (EPIC I), 988 F.Supp.2d 1, 4-7 (D.D.C.2013). In EPIC I, this Court held that a partially classified document requested by the plaintiff under the FOIA, National Presidential Security Directive ("NPSD") 54, which sets forth the U.S. Government's cybersecurity polices, was not an "agency record" within the meaning of FOIA and, therefore, the Court granted summary judgment to the defendant regarding the withholding in full of NSPD 54. See id. at 12.
The plaintiff timely appealed that decision in December 2013. Notice of Appeal at 1, ECF No. 32. While the appeal was pending, on January 27, 2014, the plaintiff "accepted a Rule 68 Offer of Judgment for $3,500 from the [defendant]." Pl.'s Mot. at 4. The Offer of Judgment reads as follows, in pertinent part:
Def.'s Offer of Judgment, Jan. 27, 2014 (the "January Judgment")
Despite the offer and acceptance of judgment, the plaintiff's appeal continued in the D.C. Circuit, with the plaintiff filing its initial appellant brief in March 2014. Def.'s Opp'n at 4. That appeal effectively ended on June 5, 2014, when the defendant released "an unclassified version of NSPD 54" to the plaintiff. Id. Four days later, the parties filed a joint motion to vacate the portion of NSC I holding that NSPD 54 was not an agency record, which motion was subsequently granted by the D.C. Circuit. Pl.'s Mot. at 4-5.
Following vacatur, the plaintiff filed the pending motion, seeking $68,354.01 in attorneys' fees and $730.28 in costs. Pl.'s Reply Def.'s Opp'n Pl.'s Mot. ("Pl.'s Reply") at 22, ECF No. 46 (including $9,786 in "fees on fees for time spent preparing [the plaintiff's] Reply").
The D.C. Circuit interprets settlement agreements under the local law of the jurisdiction where the settlement agreement is to be enforced. See Makins v. District of Columbia, 277 F.3d 544, 548 (D.C.Cir.2002) ("[W]e adopt local law in
The FOIA authorizes the award of attorneys' fees reasonably incurred by a plaintiff who is in litigation to obtain "the production of any agency records improperly withheld," 5 U.S.C. § 552(a)(4)(B), when "the complainant has substantially prevailed," id. at § 552(a)(4)(E)(i). The D.C. Circuit has construed this statutory provision as "naturally divid[ing] the attorney-fee inquiry into two prongs, which our case law has long described as fee `eligibility' and fee `entitlement.'" Brayton v. Office of the U.S. Trade Representative, 641 F.3d 521, 524 (D.C.Cir.2011) (citing Judicial Watch, Inc. v. U.S. Dep't of Commerce, 470 F.3d 363, 368-69 (D.C.Cir. 2006)). Thus, to obtain attorneys' fees under the FOIA, the plaintiff must demonstrate both eligibility and entitlement to the award. See McKinley v. Fed. Hous. Fin. Agency, 739 F.3d 707, 710 (D.C.Cir. 2014); see also Weisberg v. U.S. Dep't of Justice, 745 F.2d 1476, 1495 (D.C.Cir.1984) ("[E]ligibility alone is not enough .... the complainant must [also] show that he or she is `entitled' to an award.").
To satisfy the first requirement of eligibility for attorneys' fees, a claimant must show that he "substantially prevailed" in the underlying FOIA litigation. See 5 U.S.C. § 552(a)(4)(E)(i). The statute provides that the claimant "substantially prevail[ed]" by gaining relief from either: "(I) a judicial order, or an enforceable written agreement or consent decree; or (II) a voluntary or unilateral change in position by the agency, if the complainant's claim is not insubstantial." Id. at § 552(a)(4)(E)(ii).
In the FOIA context, Congress restored the catalyst theory with the OPEN Government Act of 2007 (the "2007 Act"), which inserted the present text of 5 U.S.C. 552(a)(4)(E)(ii). Id. After the 2007 Act took effect, FOIA applicants were once again eligible for attorneys' fees, even if they did not obtain a court order granting the relief sought, so long as the claim was "not insubstantial." Id. Thus, whether the parties' legal relationship changed, the sine qua non of attorneys' fees eligibility in most other contexts, is not as significant in FOIA fee disputes. See id.
If the plaintiff has "substantially prevailed and thus may receive fees ... the court proceeds to the entitlement prong and considers a variety of factors to determine whether the plaintiff should receive fees." Brayton, 641 F.3d at 524 (emphasis in original) (quotation marks and citations omitted). "This circuit has long applied a multi-factor standard" involving consideration of "[f]our non-exclusive factors:" "`(1) the public benefit derived from the case; (2) the commercial benefit to the plaintiff; (3) the nature of the plaintiff's interest in the records; and (4) the reasonableness of the agency's withholding' of the requested documents." McKinley, 739 F.3d at 711 (quoting Tax Analysts v. U.S. Dep't of Justice, 965 F.2d 1092, 1093 (D.C.Cir.1992)), superseded by statute, 5 U.S.C. § 552(a)(4)(E)(i), as recognized in Summers v. U.S. Dep't of Justice, 569 F.3d 500, 502 (D.C.Cir.2009)); see also Cotton v. Heyman, 63 F.3d 1115, 1117 (D.C.Cir.1995).
In Davy v. CIA, the D.C. Circuit noted that "no one factor is dispositive," but this statement comes with the significant caveat that "if the Government's position is correct as a matter of law, that will be dispositive." 550 F.3d 1155, 1159, 1162 (D.C.Cir.2008). "The sifting of those criteria over the facts of a case is a matter of district court discretion." Tax Analysts, 965 F.2d at 1094 (citing Church of Scientology v. Harris, 653 F.2d 584, 590 (D.C.Cir.1981)); see also Judicial Watch,
This four-factor entitlement test is not reflected in the text of the FOIA. See 5 U.S.C. § 552. For this and other reasons, Judge Kavanaugh has stated bluntly that the D.C. Circuit "should ditch the four-factor standard." Morley v. CIA, 719 F.3d 689, 690 (D.C.Cir.2013) (Kavanaugh, J. concurring). Relying in part on Judge Randolph's dissent in Davy, Judge Kavanaugh noted that "the four factors have no basis in the statutory text" and, indeed, "Congress's decision not to include the four factors in the statutory text appears to have been deliberate." Id. Moreover, Judge Kavanaugh described the first three factors as "incompatib[le] with the FOIA's structure and purposes" and "so vague and malleable that they provide very little guidance to district courts." Id. at 691-92.
Regardless of the wisdom in Judge Kavanaugh's suggestion that the D.C. Circuit "should jettison the four-factor standard and adopt" a rule that "prevailing plaintiffs should receive attorney's fees — with only a very narrow exception for `special circumstances' such as bad faith by a prevailing plaintiff," id. at 692 (citing Newman v. Piggie Park Enterprises, Inc., 390 U.S. 400, 402, 88 S.Ct. 964, 19 L.Ed.2d 1263 (1968)), this Court is bound by Davy and its progeny, and must apply the four-factor test.
Determining the reasonable attorneys' fees to which a prevailing party is entitled entails a three-part analysis: "(1) determination of the number of hours reasonably expanded [sic] in litigation; (2) determination of a reasonable hourly rate or `lodestar'; and (3) the use of multipliers as merited." Save Our Cumberland Mountains, Inc. v. Hodel (SOCM), 857 F.2d 1516, 1517 (D.C.Cir.1988) (citation omitted). The fee applicant bears the burden of justifying the attorneys' fees requested. See Covington v. District of Columbia, 57 F.3d 1101, 1107 (D.C.Cir.1995) ("a fee applicant bears the burden of establishing an entitlement to an award, documenting the appropriate hours, and justifying the reasonableness of the rates") (citing Blum v. Stenson, 465 U.S. 886, 896 n. 11, 104 S.Ct. 1541, 79 L.Ed.2d 891 (1984)). The party seeking fees must submit evidence regarding "the attorneys' billing practices; the attorneys' skill, experience, and reputation; and the prevailing market rates in the relevant community." Id. Upon submission of such information, a presumption applies that the number of hours billed and the hourly rates are reasonable. Jackson v. District of Columbia, 696 F.Supp.2d 97, 100-01 (D.D.C.2010) (citing Blackman v. District of Columbia, 677 F.Supp.2d 169, 172 (D.D.C.2010)). The burden then shifts to the defendant to "provide specific contrary evidence tending to show that a lower rate would be appropriate." Covington, 57 F.3d at 1109-10 (quoting Nat'l Ass'n of Concerned Veterans v. Sec'y of Def., 675 F.2d 1319, 1326 (D.C.Cir.1982) ("Concerned Veterans")).
The defendant contends that the plaintiff was not a prevailing party for the purposes of the FOIA and is therefore not entitled to attorneys' fees at all. Def.'s Opp'n at 10-14. In the alternative, the defendant argues that (1) the plaintiff is foreclosed from seeking additional fees for any period of time prior to the January Judgment; and (2) the plaintiff is not entitled to all of the fees it seeks for the period after the January Judgment. Each argument is addressed in turn below.
The defendant contends that the plaintiff did not "substantially prevail" because
Although FOIA fees are generally governed by the four non-exclusive factors set forth in Tax Analysts, the plaintiff seeks $21,987.01 for fees and costs incurred in the pursuit of NSPD 54 on or before January 27, 2014, the date on which the defendant extended the Offer of Judgment that the plaintiff ultimately accepted. See Pl.'s Mot. Ex. 1 at 1-2, ECF No. 44-2 ("Bill of Fees and Costs" noting $15,777.01 in "District Court fees" not including "Fees on fees"); id. Ex. 3 at 1, ECF No. 44-4 ("D.C. Circuit Billing Records" noting $6,210.00 in fees on or before January 22, 2014). Therefore, the plaintiff's request for any fees and costs incurred prior to the January Judgment are more properly considered under District of Columbia contract law, as part of a legal settlement. See Tsintolas Realty Co., 984 A.2d at 188.
The plaintiff contends that the fees it requests now — those pertaining to NSPD 54 and incurred before the January Judgment — should not be considered part of the January Judgment because "this Court had ruled that the request for NSPD-54 was not properly before the Court." Pl.'s Reply at 3. While the plaintiff adequately summarizes the Court's holding in EPIC I regarding NSPD 54, as previously noted, that portion of the opinion was vacated. See D.C. Circ. Order at 1; Pl.'s Reply at 3 (citing D.C. Circuit Order). Whether NSPD 54 was an "agency record" for the purposes of FOIA was still "a live controversy" up to and until the defendant agency
In any event, even if the claim were not "live" as of the January Judgment, the January Judgment made no delineation between costs for live and rejected claims. The January Judgment, offered pursuant to Federal Rule of Civil Procedure 68, allowed judgment to be taken against the defendant "in full resolution of all claims of" the plaintiff "for all costs, including attorney's fees, incurred in this action. This offered amount includes all costs accrued, including all attorney's fees and all fees on fees." Whether pertaining to a live claim or not, all costs and fees "incurred" by the plaintiff prior to January 27, 2014, including "all attorney's fees and all fees on fees," were expressly considered part of the January Judgment. Using the District of Columbia's objective method of reading contracts, where the Court looks to the written language of the contract regardless of the actual intent of the parties, Abdelrhman, 76 A.3d at 888, this Court finds that the plaintiff settled "all claims... for all costs, including attorney's fees, incurred in this action," January Judgment at 1, and the plaintiff cannot, therefore, recover attorneys' fees beyond the amount contemplated in the January Judgment for the period prior to January 27, 2014.
The policy underlying Rule 68 also militates against the plaintiff's position. The plaintiff's logic is that since the plaintiff had lost its claim regarding NSPD 54 on jurisdictional grounds, the plaintiff was not entitled to fees pertaining to its pursuit of the document and the defendant's Offer could not have encompassed that claim. See Pl.'s Reply at 7-8. By seeking nearly $22,000 in additional fees for the period covered by the January Judgment, the defendant correctly points out that the plaintiff is seeking now to "undo the Judgment already entered." Def.'s Opp'n at 8. Thus, in addition to being contrary to the plain terms of the agreement, the plaintiff's argument is contrary to the purpose of Rule 68 to "encourag[e] settlement ... [by] enhanc[ing] both defendants' incentive to extend Rule 68 offers and plaintiffs' incentive to accept them." Tunison v. Cont'l Airlines Corp., 162 F.3d 1187, 1193 (D.C.Cir.1998). Consequently, the plaintiff's Motion for Fees prior to the date of the defendant's Offer of Judgment, January 27, 2014, is denied.
This determination does not end the inquiry, however, since the bulk of the fees and costs the plaintiff seeks were incurred between February 2014 and December 2014. See Pl.'s Mot. Ex. 1 at 1-2; Pl.'s Reply at 22. The Court first determines if
As stated previously, see supra Part III.A, the defendant contends that the plaintiff is not entitled to attorneys' fees because the defendant's "withholding of NSPD 54 was correct as a matter of law" because "this Court has already held that, granting NSA summary judgment `as it pertains to NSPD 54.'" Def.'s Opp'n at 11. If the defendant were correct, this finding would end any further consideration of the plaintiff's fee petition, since "[i]f the Government's position is correct as a matter of law, that will be dispositive." Davy, 550 F.3d at 1162. The defendant, however, is not correct, for at least three reasons.
First, in vacating EPIC I prior to a decision from the D.C. Circuit, the defendant and plaintiff agreed to erase any determination as to the propriety of the defendant's withholding. In effect, the parties returned to the status quo ante, when no Court had considered whether the defendant's grounds for withholding NSPD 54 were justified. At least at this stage in the proceedings, then, no Court has determined that the defendant's position was "correct as a matter of law."
Second, the plaintiff correctly points out that the defendant did not assert the rationale on which EPIC I found that NSPD 54 need not be released: that it was not an agency record subject to the FOIA. See Pl.'s Reply at 7. Indeed, when the parties were ordered to submit a supplemental briefing schedule to account for this jurisdictional problem, as clarified by the D.C. Circuit's opinion in Judicial Watch v. U.S. Secret Service, 726 F.3d 208 (D.C.Cir2013), the defendant "conferred" with the plaintiff and "agree[d] that no supplemental briefing [was] necessary." Joint Status Report at 1, ECF No. 26. In other words, the basis for the withholding in EPIC I as to NSPD 54 was never asserted as the "Government's position" at all and, consequently, the "Government's position" was never found to be correct as a matter of law. See Davy, 550 F.3d at 1162.
Third, the position the defendant did assert was not correct as a matter of law. The defendant asserted that NSPD 54 was protected by Exemption 5 to the FOIA, which privilege exempts records from release that are "inter-agency, or intra-agency memorandums or letters which would not be available by law to a party other than an agency in litigation with the agency." 5 U.S.C. § 552(b)(5). The defendant expressly invoked "the presidential communication privilege" for exempting NSPD 54 under Exemption 5, on which EPIC I did not opine. See Def.'s Mem. Supp. Def.'s Mot. Summ. J. ("Def.'s Summ. J. Mem.") at 1-2, ECF No. 12-1.
The defendant appears to be asking for a de novo merits determination of the type expressly contemplated in Brayton. The D.C. Circuit held in Brayton that "[i]t is undeniable that considering the merits of an agency's nondisclosure decision will frequently
Fortunately, in the intervening period between EPIC I and today, another Judge in this District did address the position raised by the defendant in this matter — that presidential directives are exempt from disclosure under the FOIA's Exemption 5 — on the merits. In Center for Effective Government v. U.S. Department of State, 7 F.Supp.3d 16 (D.D.C.2013), Judge Huvelle set forth detailed reasons why the defendant's position that presidential directives were protected by the presidential communications privilege was not correct as a matter of law and such directives were not subject to FOIA's Exemption 5. To the extent that the parties look to have their dispute addressed anew in the context of this fee petition, despite the fact that the plaintiff has already received the document it requested, the Court sees no reason to disagree with the reasoning set out in Center for Effective Government. Thus, far from asserting a position that was "correct as a matter of law," the defendant, in light of Center for Effective Government, asserted a position that was incorrect as a matter of law. Since the fourth factor in the Tax Analysts test is only dispositive if the government's position is "correct as a matter of law," Davy, 550 F.3d at 1162, and Center for Effective Government found that the defendant's position was incorrect as a matter of law, no one factor of the Tax Analysts test is dispositive and the Court must examine all four of them to determine whether the plaintiff is entitled to a fee award.
The four non-exclusive factors to be examined in awarding FOIA attorneys' fees are (1) the public benefit of the information sought; (2) the commercial benefit to the plaintiff; (3) the nature of the plaintiff's interest; and (4) the defendant's reasonable basis for withholding information. See Tax Analysts, 965 F.2d at 1093. As for the first factor, the defendant asserts that the release of the information sought by the plaintiff provides only minimal public benefits because the plaintiff "identifies only one public news account that makes any reference to the release of NSPD 54 whatsoever." Def.'s Opp'n at 12. This media coverage-based argument was advanced and rejected in EPIC v. FBI, No. 13-442, 72 F.Supp.3d 338, 346, 2014 WL 5713859, at *5 (D.D.C. Nov. 5, 2014). In that case, the court found that the release of records related to an FBI facial recognition database was "fairly within the public interest," "expand[ed] public knowledge" about the FBI's system, and "inform[ed] debate regarding how the system and its data [were] used." Id. 72 F.Supp.3d at 345, at *4. The defendant argued that the presence of few media articles in the record discussing "the specific records obtained in" the case militated against finding that the public was benefitted by the release of records. Id. 72 F.Supp.3d at 346, at *5. The court rejected that contention, stating that the "argument focuses the public benefit factor too narrowly," noting that "[t]he relevant inquiry is
In the instant matter, NPSD 54, and its information regarding national cybersecurity procedures, is "likely to add to the fund of public information" by providing additional information to citizens regarding their government's activities, which is the fundamental purpose of FOIA. See Roth v. U.S. Dep't of Justice, 642 F.3d 1161, 1177 (D.C.Cir.2011). The defendant's focus on the number of news articles mentioning the released records fails to take into account the likelihood that this information will continue to inform public discourse for years to come. See Morley, 719 F.3d at 690 ("[T]he standard for entitlement to attorney's fees does not `disqualify plaintiffs who obtain information that, while arguably not of immediate public interest, nevertheless enables further research ultimately of great value and interest'" (quoting Davy, 550 F.3d at 1162 n. 3)). Thus, the first Tax Analysts factor favors the plaintiff.
The second and third factors, the plaintiff's commercial benefit and interest in the information, can be evaluated together. Davy, 550 F.3d at 1160 ("The second and third factors ... are often considered together"). The defendant makes a cursory attempt to show that these factors do not favor the plaintiff by noting that the plaintiff, a non-profit advocacy organization, is seeking donations through its website and newsletters, which also publicize the plaintiff's success in obtaining NSPD 54's release. See Def.'s Opp'n at 13-14. The defendant cites to no authority for the proposition that a non-profit organization's success at obtaining the release of documents should be held against it when that same organization mentions such success indirectly in its fundraising appeals. See id. Moreover, as the defendant concedes, other Judges in this District have determined that these two factors distinctly favor this plaintiff, since it is a "non-profit public interest research center ... [that] derived no commercial benefit from its FOIA request or lawsuit," and its stated aims are the public dissemination of information. EPIC v. U.S. Dep't of Homeland Sec., 811 F.Supp.2d 216, 235 (D.D.C.2011) (alteration in original). Thus, the second and third factors favor the plaintiff.
As to the fourth factor, as explained above, the defendant's withholding of NSPD 54 was not "correct as a matter of law" and was rejected in Center for Effective Government. See supra Part III.C.1. Thus, this fourth factor favors the plaintiff. Since all four Tax Analyst factors favor the plaintiff, the plaintiff is entitled to a fee award. The amount of that award is reviewed for reasonableness next.
In awarding attorneys' fees, courts generally must follow the "lodestar" method, whereby an attorney's reasonable hourly rate is multiplied by the number of hours expended on the litigation. See SOCM, 857 F.2d at 1517. The defendant challenges the plaintiff's method of recordkeeping and the reasonableness of the hours expended in litigation.
The burden therefore shifts to the defendant to come forward with "specific contrary evidence" to rebut the presumption of reasonableness that inheres in the plaintiff's fee request. Covington, 57 F.3d at 1109-10. The only "evidence" the defendant presents is a challenge to the reasonableness of staffing levels on certain "conferences" held by the plaintiff's attorneys. Def.'s Opp'n at 22. It is axiomatic that "trial courts need not, and indeed should not, become green-eyeshade accountants" in examining fee requests since "[t]he essential goal in shifting fees (to either party) is to do rough justice, not to achieve auditing perfection." Fox v. Vice, 563 U.S. 826, 131 S.Ct. 2205, 2216, 180 L.Ed.2d 45 (2011). It is, quite simply, unnecessary and a waste of judicial resources to engage in such a picayune review of the subjective reasonableness of the number of attorneys who participated in a conference call.
Nevertheless, the defendant's allegation that the plaintiff negotiated in bad faith by submitting "exploding" settlement offers on the eve of the deadlines for the submission of status reports to the Court is troubling. See Def.'s Opp'n at 24-25. Specifically, the defendant alleges that the plaintiff submitted to the defendant settlement offers that were "placed on the table for less than twenty-four hours, and withdrawn over the objection of [defense] counsel, and before [defense counsel] had had a reasonable opportunity to consider it." Id. at 24. These "exploding offers" do not appear to have been submitted with a deadline for consideration, alerting the defendant that it would be required to respond within a set period of time. See id. at 5. Disturbingly, both offers of judgment from the plaintiff were extended within 24 hours of a deadline for a submission to the Court regarding the status of settlement discussions. See id. Thus, it would appear that these offers were extended for the express purpose of allowing the parties to make representations to the Court that were true at the time the required submissions were made, and were then withdrawn almost immediately after the submission was filed. See id.
To sum up, the plaintiff is eligible for and entitled to attorneys' fees as a prevailing party under 5 U.S.C. 552(a)(4)(E)(ii)(II). All fees and costs incurred prior to January 27, 2014 are covered by the January Judgment and therefore disallowed. The Court also disallows all fees incurred on and after October 1, 2014, when the plaintiff engaged in what can be charitably described as "sharp practice" in its submission of offers to the defendant that "exploded" after the submission of status reports to the Court indicating potential progress in negotiations. These deductions total $37,174.01.
For the foregoing reasons, the plaintiff's Motion for Attorney's Fees and Costs is granted in part and denied in part. The defendant shall pay $31,180.00 in eligible attorneys' fees and costs, which amount constitutes the reasonable fees and costs incurred between January 27, 2014 and October 1, 2014.
An Order consistent with this Memorandum Opinion will issue contemporaneously.
