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STRAMA v. PETERSON

April 8, 1983

THOMAS J. STRAMA, PLAINTIFF,
v.
PAUL Q. PETERSON, M.D., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Shadur, District Judge.

MEMORANDUM OPINION AND ORDER

    1. Dr. Frank Baker ("Dr. Baker") of the
  University of Chicago, head of the City's
  paramedic program, was found liable for $53,000
  ($13,000 in compensatory and $40,000 in punitive
  damages) on Strama's pendent state law claims
  (not under Section 1983) and
    2. Dr. Paul Peterson and Karen Swanson
  (collectively "State Defendants") were found
  liable for an aggregate of $7,000 in compensatory
  damages under Section 1983.

Successful Section 1983 actions also carry with them the right to fee awards under 42 U.S.C. § 1988 ("Section 1988"). Before trial this Court awarded Strama $45,551.56 against Albrecht, 541 F. Supp. 75 (N.D.Ill. 1982) ("Strama I"), only to have that amount reduced to $32,017.81 by our Court of Appeals, 689 F.2d 661 (7th Cir. 1982) ("Strama II," of which more later). Strama now seeks a post-trial award against State Defendants.*fn1 This opinion deals with the several problems that presents.

Standards for the Fee Award

Our Court of Appeals has often repeated and often applied the standards for attorney's fee awards as articulated in Waters v. Wisconsin Steel Works of International Harvester Co., 502 F.2d 1309, 1322 (7th Cir. 1974), cert. denied, 425 U.S. 997, 96 S.Ct. 2214, 48 L.Ed.2d 823 (1976). This Court sought to apply those standards in Strama I. If it erred in communicating just how those factors operated in this case, thus contributing to the reduction by the Court of Appeals, certainly Strama and Seliger should not be penalized for that fact. Accordingly this opinion will (at the risk of courting a repeat performance) address the issue again.

State Defendants' attack on the reasonableness of the time spent by Strama's counsel is dealt with later in this opinion and found wholly unwarranted. Development of a "lodestar" figure therefore depends primarily on the appropriate hourly rate.

This Court did not (as Strama II appeared to assume) apply an overall multiplier to the lodestar amount in Strama I. Instead it focused on the established value for like services in the Chicago legal community.*fn2 It drew on its own then-fresh experience in the practice as the senior active partner (and the principal billing partner) in a Chicago firm, familiar with the "going rate" for lawyers of the skill and seniority of Strama's principal counsel Stephen Seliger ("Seliger"). And it found that going rate — the fair market value of Seliger's services — to be $125 per hour. For better or worse, this Court views the Court of Appeals' approach in Strama II as having missed an important aspect of Section 1988 law this Court thought implicit in its own analysis — but that this Court obviously should have made explicit, so the Court of Appeals could have dealt with the question directly.

In other contexts courts (including our Court of Appeals) have consistently made plain that the proper Section 1988 test is not what the plaintiff's lawyer has charged in fact, but rather what the reasonable value of the lawyer's services is. That may arguably be a contradiction in free market terms, but it is one the courts have accepted. Losing civil rights defendants have not been successful in challenging awards to lawyers acting pro bono, or salaried lawyers, on the ground plaintiffs would not in fact have had to pay the amount of fees actually awarded. See, e.g., Gautreaux v. Chicago Housing Authority, 690 F.2d 601, 612-13 (7th Cir. 1982), petition for cert. filed, 51 U.S.L.W. 3583 (U.S. Jan. 31, 1983) (No. 82-1289). Were the rule otherwise, the civil rights violator would stand to obtain a windfall from the fact the plaintiff had to resort to a Legal Assistance Foundation lawyer or an ACLU volunteer lawyer. In another variant of the same concept, our Court of Appeals has recently rejected both the "bright prospects" standard and the notion that a contingent fee contract should serve "as an automatic ceiling on the amount of a [Section 1983 case] award." Sanchez v. Schwartz, 688 F.2d 503, 505 (7th Cir. 1982), followed in Lenard v. Argento, 699 F.2d 874, 900 (7th Cir. 1983).*fn3

No principled distinction seems reasonable between pro bono or salaried lawyers (or for that matter, lawyers for large firms) on the one hand and a lawyer like Seliger on the other, simply because the latter has opted for life as a sole practitioner rather than for pro bono work or for the large firm practice to which his high-quality credentials would give him entree.*fn4 Under the facts of life in the law practice, Seliger performs the bulk of his work in cases that depend on fee awards, and in the comparatively few situations where he can charge on an hourly basis his clients cannot bear the higher tariff his counterparts in larger firms command from deeper-pocket clients.

Because the issue has been confronted by our Court of Appeals only inferentially, and because the matter is one of such wide-ranging applicability, this Court will risk laboring the subject to avoid any further misunderstanding of its views and holding. In sum the operative principles line up this way:

    1. We seek under Section 1988 for "a reasonable
  attorney's fee."
    2. What is "reasonable" is not limited by what
  the individual lawyer involved has contracted to
  charge in the case in which fees are being awarded.
  Sanchez; Lenard.
    3. What is "reasonable" is also not limited by
  what the individual lawyer charges in his or her
  practice generally. Gautreaux.

Accordingly one indicium of the "reasonable" fee may be the price the lawyer places on his or her services in this or other situations, but the cases have rejected that as the conclusive factor in ascertaining the market rate. Seliger cannot fairly be placed in a limbo unoccupied by the rest of lawyerdom.

If the search is indeed for the reasonable fee — for the fair market value of the lawyer's services — the answer is easy. Affidavits tendered by Seliger and uncontroverted by State Defendants*fn5 confirm what this Court's own experience had taught the first time around: Seliger is at least a $125 per hour lawyer, not an $80 per hour lawyer, in terms of fair value in today's market.*fn6

Accordingly this Court determines once again — this time supported by an ample evidentiary record and the conduct of the trial, not only by this Court's own prior experience and knowledge in the market — that the reasonable value of the services provided by Seliger is the real-value lodestar figure derived by multiplying the hours spent times a $125 hourly rate. For each of the other lawyers and paralegals the lodestar figure is that requested by Strama (State Defendants have offered no contest in that respect).

Law of the Case

This Court inquired of the parties on its own motion whether law of the case (or perhaps defensive collateral estoppel) should apply to bar a fresh look at the Seliger hourly rate. After consideration, this Court will not do so for three reasons:

    1. Much of the time involved in the current
  petition is trial time (the rest being trial
  preparation). Though it was not this Court's
  former law firm's practice to apply a premium to
  trial time (like wartime combat pay),*fn7 that
  factor is taken into account by some firms and
  some decisions.*fn8
    2. As already stated, Seliger disclosed a high
  level of skill in the trial itself. Those
  activities represented "more difficult legal
  tasks" than those referred to by Strama II in
  setting an $80 rate.
    3. If the Court of Appeals' Strama II decision on
  the hourly rate (without taking into account the
  different factors already identified) were in fact
  in part the result of failure of communication of
  the principles now better articulated in the
  preceding section of this opinion, it would appear
  unfair for the consequences to be visited on Strama
  and Seliger.

Fee Allowable Against State Defendants

Added complexity is injected into the problem by the differing results here as to the three sets of defendants — Albrecht having settled before trial and then having paid a fee award, Baker having been the subject of the large ($53,000) jury award on pendent state law claims and then having paid an unknown lump sum in settlement, and State Defendants having been the subject of the much smaller ($7,000) jury award. Ordinarily tortfeasors are jointly and severally liable, with the plaintiff having the free choice of whom to pursue (subject to possible contribution among the tortfeasors at the behest of the defendant required to pay in the first instance). But the situation here seems to call for different treatment:

    1. Where each defendant is liable for a
  discrete amount of damages (instead of joint and
  several liability for a single figure), joint and
  several liability for the entire fee award
  appears inappropriate. See Dean v. Gladney,
  621 F.2d 1331, 1340 (5th Cir. 1980), cert. denied,
  450 U.S. 983, 101 S.Ct. 1521, 67 L.Ed.2d 819 (1981).
    2. Where the disparity between the liability
  amounts is as great as here, the added principle
  that "usually attorneys' fees should not be
  granted `greatly in excess of a client's
  recovery'" ...

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