D. Attorney's Fees and Costs

• Library: South Carolina Damages (SCBar) (2009 Ed.)

D. Attorney's Fees and Costs

Attorney's fees are authorized under the Civil Rights Attorney's Fees Awards Act of 1976:

In any action or proceeding to enforce a provision of sections .1983, .the court, in its discretion, may allow the prevailing party, other than the United States, a reasonable attorney's fee as part of the costs . . . . ⁵⁹
Fed. R. Civ. P. 54(d)(2) requires that a claim for attorney's fees be made by motion which, "unless otherwise provided by statute or order of the court, .must be filed no later than 14 days after entry of judgment; must specify the judgment and the statute, rule, or other grounds entitling the moving party to the award; and must state the amount or provide a fair estimate of the amount sought."⁶⁰

The availability of attorney's fees, as with damages, is affected by the Eleventh Amendment. Generally, "liability on the merits and responsibility for fees go hand in hand."⁶¹ Thus, the Eleventh Amendment does not bar an award of attorney's fees against the state if a state official is properly held liable in his official capacity—that is, if liable for prospective injunctive relief only;⁶² but the state is not liable for fees awarded against an official held liable in his individual capacity.⁶³ Legislative immunity is an absolute bar to an attorney's fee award, as it is to any relief on the merits.⁶⁴ Judicial immunity, however, is not a bar to attorney's fees,⁶⁵ although by statute "in any action brought against a judicial officer for an act or omission taken in such officer's judicial capacity such officer shall not be held liable for any costs, including attorney's fees, unless such action was clearly in excess of such officer's jurisdiction."⁶⁶

1. Entitlement to Fees: "Prevailing Party" Status

Under section 1988(b), a "prevailing" plaintiff is entitled to fees unless there are "special circumstances [that] would render such an award unjust."⁶⁷ A prevailing defendant, however, may recover fees only if "the plaintiff's action was frivolous, unreasonable or without foundation, even though not brought in subjective bad faith."⁶⁸ At a minimum, to be considered a prevailing party within the meaning of section 1988(b), a fee applicant "must be able to point to a resolution of the dispute which changes the legal relationship between itself and the defendant."⁶⁹ In Buckhannon Board & Care Home, Inc. v. West Virginia Department of Health & Human Resources, the Supreme Court clarified what form the legal change must take.⁷⁰ There the Court reversed a fee award to a plaintiff whose action, brought under the Fair Housing Amendments Act and the Americans with Disabilities Act, resulted in legislative change that mooted its claim. The Court held the plaintiff was not a "prevailing party" entitled to attorney's fees because it had obtained no "judicially sanctioned" relief that effected a change in the litigants' legal relationship. Reviewing its case law, the Court stated that "enforceable judgments on the merits and court-ordered consent decrees create the 'material alteration of the legal relationship of the parties' necessary to permit an award of attorney's fees."⁷¹

The Fourth Circuit considers the "designation of a party as a prevailing party" to be "a legal determination" and reviews it de novo.⁷²Under this standard the court has applied Buckhannon to deny prevailing party status to plaintiffs whose relief was limited to a preliminary injunction and a settlement agreement referenced in the district court's order of dismissal.⁷³ Under Buckhannon, as applied in Smyth, it seems clear that a party to a settlement agreement is not entitled to fees in a section 1983 action unless the settlement is embodied in a judicial order that provides for its enforcement, such as a consent decree.⁷⁴

2. Reasonableness of Fees

Section 1988(b) requires that the fee awarded be "reasonable." The Supreme Court has concluded that "'the most critical factor' in determining the reasonableness of a fee award 'is the degree of success obtained.'"⁷⁵ Accordingly, the Court has directed that "'a district court, in fixing fees, is obligated to give primary consideration to the amount of damages awarded as compared to the amount sought.'"⁷⁶

In proposing a reasonable fee, the applicant should identify a "lodestar" figure, that is, "the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate."⁷⁷ As accepted (or modified) by the court, the lodestar "is presumed to be the reasonable fee contemplated by § 1988."⁷⁸ If a party prevails on only some of his claims, to the extent that time spent on distinct claims can be segregated, fees will be awarded only for hours spent on successful claims.⁷⁹ The Fourth Circuit has warned, however, that "entitlement to fees for one aspect of a protracted litigation does not turn narrowly on whether the party prevailed on that particular matter, but whether a separate claim or, as here, a separate proceeding is so unrelated as to justify treating it as a 'separate lawsuit[ ].'"⁸⁰ In Plyler the court upheld the district court's award of fees to the plaintiff's counsel for work performed opposing the defendant's motion to modify a consent decree to permit double-celling of prisoners, even though the modification was approved on appeal. The court explained that after successfully negotiating the consent decree, "plaintiffs' counsel were under [sic] clear obligation to make the defensive effort."⁸¹

The fee applicant "bears the burden of .documenting the appropriate hours expended and hourly rates."⁸² The opposing party then must "submit .evidence challenging the accuracy and reasonableness of the hours charged or the facts asserted in the affidavits submitted by [plaintiffs'] counsel," including that "the number of hours billed were reasonable for cases of similar complexity," and risks waiving his right to challenge the fees if he fails to do so.⁸³

The Fourth Circuit has outlined the following procedure for an attorney's fee applicant:

First, the applicant must make every effort to submit time records which specifically allocate the time spent on each claim. Second, those records should attempt to specifically describe the work which the fee applicant allocated to unsuccessful claims so as to assist the district court determining the reasonableness of the fee request. In establishing these guidelines, we recognize that some claims may have such a common core of facts and legal theories so as to prevent any allocation of the fees to the applicant's separate claims. However, we hereby admonish all parties that a blind adherence to this argument runs the risk of incurring a complete denial of fees.⁸⁴

The hours claimed must not include "duplicative or unrelated hours" and must reflect "billing judgment."⁸⁵ In the end, they must seem reasonable to the district court in light of the complexity of the case and the results obtained.⁸⁶

The lodestar's "reasonable hourly rate" is based on "the prevailing market rates in the relevant community,"⁸⁷ which "is ordinarily the community in which the court where the action is prosecuted sits."⁸⁸ Rates from other locales may be appropriate, however, if two criteria are met: (1) qualified local counsel is unavailable because of "the complexity and specialized nature" of the case and (2) "the party choosing the attorney from elsewhere acted reasonably in making the choice."⁸⁹ In addition, to account for delay in payment over the course of a lawsuit, the district court may "increase the hourly rates to reflect current market rates" or "increase the lodestar to counterbalance the effect of inflation and foregone interest on the value of the fee."⁹⁰

The applicant bears the burden of producing evidence "in addition to the attorney's own affidavits"...