Hourly Rates

• Jurisdiction: Maryland

IV. HOURLY RATES

A. Community Rates

A lodestar calculation requires determination of the attorneys' reasonable hourly rate, in order to multiply those rates times the reasonable hours expended and come to an initial calculation. The reasonableness of hourly rates for legal services is measured by the prevailing market rates in the relevant community for attorneys of similar experience and skill.¹³⁷ The appropriate rates are the rates earned by private counsel in other complex litigation. As the U.S. Court of Appeals for the Second Circuit has held, "[Congress] intended that the amount of fees awarded under [§ 1988] be governed by the same standards which prevail in other types of equally complex federal litigation [. . .] and not be reduced because the rights involved may be nonpecuniary in nature."¹³⁸

Typically the rates differ in different communities. Reasonableness of hourly rates is generally measured by reference to market rates in the forum community for attorneys of similar experience and skill.¹³⁹ However, out-of-town rates are sometimes permitted when the litigant acted "reasonably" in hiring counsel from elsewhere.¹⁴⁰

As Judge Grimm affirmed in Thompson v. United States Department of Housing and Urban Development,¹⁴¹ the controlling "local rule" provides that the "community in which the court sits is the first place to look in evaluating the prevailing market rate."¹⁴² Maryland's federal court has promulgated guidelines for determining the appropriate hourly rates in fee-shifting cases, in the form of Appendix B of the Local Rules.¹⁴³ Appendix B requires the attorney seeking the fees to explain both the lawyer's customary fees, and "the customary fee for like work prevailing in the attorney's community."¹⁴⁴ Consideration of the reasonable rates, however, cannot just begin and end with the Guidelines. Indeed, as noted, the Guidelines directly acknowledge that they are in no way binding, and that the community rates must be applied.¹⁴⁵

In fee-shifting cases arising in the District of Columbia, the "Laffey matrix" of presumptively approved hourly rates for fees is based upon the years of experience of counsel. Save Our Cumberland Mountains, Inc. [SOCM] v. Hodel.¹⁴⁶ SOCM approved the prevailing rates adopted in 1983 by the district court in Laffey v. Northwest Airlines, Inc.¹⁴⁷ The U.S. Attorney's Office—a frequent litigator of employment discrimination cases from the attorney's side—i ssues its updated matrix each year¹⁴⁸ . This matrix uses the Laffey decision as a baseline, which then is updated annually based on inflation and increases in the general Consumer Price Index (the "Index"). The matrix enjoys widespread acceptance in the federal courts in Washington, D.C. as a guideline reflective of prevailing rates.¹⁴⁹ Another Laffey matrix, which is calculated based upon updates to the consumer price index for legal services specifically, has also enjoyed some acceptance.

Michael Kavanaugh, a Ph.D. economist who has testified frequently regarding the Laffey matrix, has used a different updating method, one which has been approved for use in the courts as well. Kavanaugh maintains that by taking the rates approved in SOCM, and updating those based upon the Consumer Price Index specific to legal services, rather than the general Index, he arrives at a more accurate basis for determining community rates. In the District of Columbia, under the U.S. Attorney's Office's update to the Laffey matrix, an attorney with 20 years' experience would have been compensated $370 per hour in 2003, and at $465 in 2009. Under Dr. Kavanaugh's calculations, the appropriate rate was $671 per hour in 2009. Appendix B rates in the U.S. District Court for the District of Maryland would have compensated an attorney of eight years' experience or more at $275-$400 per hour. Kavanaugh used this method with court approval in Salazar v. District of Columbia, 123 F. Supp. 2d 8 (D.D.C. 2000). His analysis was also adopted in the cases of Interfaith Community Organization v. Honeywell, 336 F. Supp. 2d 370 (D.N.J. 2004) and PIRG v. Magnesium Elecktron, Inc., 40 EN'T REP. CASE (BNA) 1917 (D.N.J. Dec. 28, 1995), vacated on other grounds, 123 F.3d 111 (3d Cir. 1997).¹⁵⁰

However, in Miller v. Holzmann, 575 F. Supp. 2d 2, 17-18 (D.D.C. 2008), the U.S. District Judge Royce Lamberth declined to adopt the Kavanaugh matrix, stating:

Kavanaugh's matrix incorporates price inflation data specific to the market for

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