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BENNETT v. CENT. TELEPHONE CO. OF ILL.

September 30, 1985

KATHLEEN BENNETT, ET AL., PLAINTIFFS,
v.
CENTRAL TELEPHONE COMPANY OF ILLINOIS, ET AL., DEFENDANTS.



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

  MEMORANDUM OPINION AND ORDER

In April 1984 plaintiffs and Centel entered into a Stipulation and Settlement Agreement (the "Agreement") resolving the dispute in plaintiffs' favor. Plaintiffs also agreed to dismiss their claims against Union on final approval of the Agreement, provided Union cooperated in specified ways with implementation of the Agreement. After (1) notice to the class of the proposed settlement and (2) a July 1984 hearing to determine whether the settlement terms were fair, reasonable and adequate, this Court approved the Agreement and dismissed the action with prejudice. It retained jurisdiction only for (1) enforcement and implementation of the settlement and (2) resolution of issues in connection with any petition by plaintiffs for attorneys' fees and costs.

As "prevailing parties" in a Title VII action, plaintiffs have now invoked 42 U.S.C. § 2000e-5(k) ("Section 2000e-5(k)"), with its provision for the award of a reasonable attorneys' fee as part of costs. Their Supplemental Motion for Fees and Costs (the "Petition") seeks to recover against Centel $375,158.25 in attorneys' fees plus an appropriate enhancement, $12,895 for paralegal work and $11,494.64 as reimbursement of expenses.*fn1 Reflecting the too-often-encountered fees-on-fees problem, plaintiffs have also filed a Second Supplemental Petition for Fees (the "Second Petition"), asking to recover $50,706 in attorneys' fees, $4,556.25 in paralegal work and $14,982.89 in expenses, all incurred in prosecution of the Petition. Centel has objected on a number of grounds to the reasonableness of plaintiffs' request in both the Petition and the Second Petition. This opinion will address those objections in the course of determining a reasonable fee award pursuant to Section 2000e-5(k).

Petition

As Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S.Ct. 1933, 1939, 76 L.Ed.2d 40 (1983) teaches:*fn2

  The most useful starting point for determining
  the amount of a reasonable fee is the number of
  hours reasonably expended on the litigation
  multiplied by a reasonable hourly rate. This
  calculation provides an objective basis on which
  to make an initial estimate of the value of a
  lawyer's services.

Plaintiffs ask compensation for 2,942.7 hours expended over a period of some 6 1/2 years (primarily by four lawyers). They apply hourly rates ranging from $170 downward to $95 to different components of that total, depending upon the seniority and expertise of the lawyer doing the work. In addition plaintiffs seek fees for 515.8 paralegal hours at an hourly rate of $25.

One important point should be addressed briefly before this opinion turns to the particulars. Because Centel has mounted a highly specific and detailed attack on the Petition, it has created — though not necessarily purposefully — a situation in which there is danger of losing sight of the forest for the trees. True enough, plaintiffs are seeking a large amount — just short of $400,000 — in attorneys' fees and expenses. But that amount (even if allowed in full) would be reasonable in light of the results obtained in this class action. Centel ultimately agreed not only to a monetary settlement of $735,000 but also to specific alterations in its hiring and promotion policies, designed to eradicate the complained-of discrimination. Moreover Centel agreed to provide semi-annual reports to plaintiffs' counsel detailing its efforts to eliminate the practices that gave rise to that litigation. Plainly the requested fee award must be measured against not only the monetary award but also the wide-ranging equitable relief embodied in the settlement. In that context, the fee request could in no event be deemed unreasonable on the theory it is disproportionate to the results obtained by plaintiffs and their lawyers.

1. Recovery of Sobek Time

Centel first challenges plaintiffs' request for $28,257.50 in attorneys' fees (for 201.3 hours of attorney time) accrued by plaintiffs' counsel in Judith Sobek v. Central Telephone Company of Illinois, FEPC Charge No. 1978 CF 581, a proceeding before the then Illinois Fair Employment Practices Commission ("FEPC"). Sobek, an employee in Centel's Customer Services Department, charged Centel with sex discrimination evidenced by her being paid less than males doing the same work. Sobek later charged Centel with retaliation and constructive discharge, claiming she was effectively forced to quit her job as a result of having filed the FEPC sex discrimination charge. In April 1982 an FEPC administrative law judge issued a recommended order finding against Sobek on her sex discrimination claim, but leaving open her retaliation claim. Sobek ultimately settled the latter claim with Centel for $33,334, plus attorneys' fees of $16,666.

Centel makes two arguments for excluding all Sobek time from any fees award in the present case:

    1. Its payment of $16,666 in fees in settlement
  of the retaliation charge also fully settled any
  fees claim for Sobek time.
    2. Sobek, which involved a different charging
  party, was wholly distinct from this litigation.

Neither argument is persuasive.

Centel's first contention rests on the rather peculiar premise that plaintiffs are somehow considered to have given up a claim Sobek herself was not even entitled to assert in the Sobek proceeding. Because Sobek prevailed before the FEPC only on her retaliation claim, she had a right to fees there solely on that claim. As Sobek's FEPC-filed Petition for Fees and Costs ("Sobek Petition") ¶ 2 put it:

  Under the [FEPC's] decision, only those hours
  spent on the successful retaliation claim and
  those within the motion for sanction are
  compensable. Not surprisingly petitioner's
  counsel did not maintain their time records on
  this basis, and therefore have to attempt to
  allocate

  their time. This allocation is set out in the
  attached affidavit.

Ultimately the Sobek Petition was withdrawn and the fees matter was resolved as part of the settlement. But it is wholly unreasonable to characterize that settlement — as it affects plaintiffs — as encompassing more in terms of fees than did the Sobek Petition.*fn3 In short, the Sobek settlement alone does not bar recovery for time spent on Sobek matters other than the retaliation claim, so long as plaintiffs can establish such time is properly compensable in the context of the present litigation.*fn4

Plaintiffs ground their claim for Sobek time fees on the holding in New York Gaslight Club, Inc. v. Carey, 447 U.S. 54, 71, 100 S.Ct. 2024, 2034, 64 L.Ed.2d 723 (1980):

  In sum, we conclude that [Section 2000e-5(k)]
  authorize[s] a federal-court action to recover an
  award of attorney's fees for work done by the
  prevailing complainant in state [administrative]
  proceedings to which the complainant was referred
  pursuant to the provisions of Title VII.

Centel argues Gaslight is inapplicable here because Sobek was neither a named plaintiff nor a member of the plaintiff class and because the Sobek sex discrimination claims did not implicate the plant side/office side dichotomy that formed the basis of the class certification. But as plaintiffs point out, the plant side/office side dichotomy formed the background of Sobek's claims. Pl. Ex. A at 6-15. And of course Sobek, an employee wholly appropriate for inclusion in the plaintiff class, was foreclosed from that status only by the fact that the settlement of her retaliation claim was conditioned upon her release of all other claims against Centel. In sum, the logic (if not the letter) of the Gaslight holding extends to a case like this one.

But even apart from Gaslight, the disputed Sobek hours are compensable under the rationale of Hensley, 461 U.S. at 433, 103 S.Ct. at 1939. Just last term Webb v. Board of Education of Dyer County, ___ U.S. ___, 105 S.Ct. 1923, 1928-29, 85 L.Ed.2d 233 (1985) observed that such preliminary lawyer services as "the drafting of the initial pleadings and the work associated with the development of the theory of the case" are compensable as time reasonably expended on the action or proceeding. Webb, 105 S.Ct. at 1929 declined to allow fees for five years of work expended in connection with administrative proceedings before filing an action under 42 U.S.C. § 1983 because:

  The petitioner made no suggestion below that any
  discrete portion of the work product from the
  administrative proceedings was work that was both
  useful and of a type ordinarily necessary to
  advance the civil rights litigation to the stage
  it reached before settlement.
  Here, by contrast, plaintiffs reflect the Sobek hours as spent developing the factual basis for this litigation. Sobek's claim and the investigation it launched led to the discovery of Centel's pattern of sex discrimination. Hence it served as the springboard for this action, and the Sobek work for which plaintiffs now seek compensation was directly useable in this case. Had the lawyer time devoted to documenting the factual background of Centel's discriminatory practices not been expended in connection with Sobek, that same time would have had to be spent in connection with the present action.

Under those circumstances, and given plaintiffs' particular care in limiting their Sobek time request (see n. 4), there is no legitimate reason to deny their petition in that respect. Plaintiffs are entitled to recover attorneys' fees for 201.3 Sobek hours, all of which were spent on matters necessary to plaintiffs' conduct of this lawsuit and not compensable under the Sobek settlement.

2. Reconsideration of Class Certification

After this Court's August 4, 1982 opinion ("Opinion I") certifying the plaintiff class, both Centel and plaintiffs filed motions to reconsider the class ruling. Centel sought a clarification of the class definition to exclude from the class all those asserting salaried claims. On the other hand, plaintiffs sought a redefinition of the class to include salaried employees claiming discrimination "because of lack of plant side experience or otherwise" (Opinion I at 5, quoting Pl. Ans. Mem. 5).

This Court's April 6, 1983 memorandum opinion and order ("Opinion II") rejected both positions. Opinion II at 5 stated:

  It cannot be said that discriminatory salaried
  employee compensation claims deriving from
  Centel's segregative (plant v. office) employment
  practices were "denied certification." . . .
  [T]hose claims are simply possible ingredients in
  measuring the damages suffered by certain class
  members.

Opinion II at 8 turned down plaintiffs' effort to expand the class to include salaried claims not deriving in any way from the plant/office dichotomy, viewing that as a late attempt to amend the complaint.

Against that background, Centel now claims plaintiffs are entitled to no fees for work done in connection with their motion to reconsider Opinion I. Because plaintiffs did not prevail on that motion, Centel says they are not entitled to recover fees under the teaching of Hensley, 461 U.S. at 440, 103 S.Ct. at 1943:

Where the plaintiff has failed to prevail on a claim that is distinct in all respects from his successful claims, the hours spent on the unsuccessful claim should be excluded ...


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