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Capps v. Drake

United States District Court, S.D. Illinois

March 30, 2017

ISAAC W. CAPPS, Plaintiff,


          MICHAEL J. REAGAN Chief Judge United States District Court



         This is a civil rights action filed on April 15, 2014 by Plaintiff, Isaac W. Capps, through his attorney, Judith M. Redwood brought pursuant to 42 U.S.C. § 1983. In his complaint, Plaintiff alleges that Defendants Kevin Drake, Jared Freeman, and Shawn Isaacs (Illinois State Police Officers), Kevin Roye and Brice Shaffer (Franklin County Deputy Sheriffs), and James Trogolo (West Frankfort Police Officer) used excessive force and failed to intervene while Plaintiff was placed under arrest on April 17, 2012. This Order addresses Plaintiff's counsel's statutory claim for fees.

         Following a 5-day jury trial before United States District Judge Nancy J. Rosenstengel, Plaintiff prevailed on his failure to intervene claim against all Defendants and prevailed on his excessive force claim against Defendants Trogolo and Roye (losing on this same claim to Defendants Drake and Shaffer). Plaintiff was awarded $22, 000.00 in compensatory damages and $10, 092.00 in punitive damages, which were assessed as follows: $23.00 (each) against Defendants Drake, Freeman, Isaacs, and Shaffer, and $5, 000 (each) against Defendants Trogolo and Roye. The jury's damage award, which totaled $32, 092.00, was a modicum of Plaintiff's quixotic pre-trial demand of $3.6 million which, while unrealistic in its own right, also unrealistically required Defendants to admit liability.

         Post-trial, on February 24, 2016, Plaintiff, through Attorney Redwood, filed a motion for attorney's fees and costs seeking an award of $397, 622.50, which she peculiarly and without support multiplied by a factor of two for a total request of $795, 245.00. Plaintiff also seeks statutory post-judgment interest on the Court's award of attorney's fees (Doc. 186).

         Judge Rosenstengel ordered the parties to appear for a settlement conference before Magistrate Judge Wilkerson in an attempt to resolve the pending motion for attorney's fees as well as motions for judgment as a matter of law filed by all Defendants following trial. See Hensley v. Eckerhart, 461 U.S. 424, 437 (1983) (In accordance with the Supreme Court's admonition that “[i]deally, of course, litigants will settle the amount of a fee”). The settlement conference, which was held on June 6, 2016, did not prove fruitful. Prior to the settlement conference, Plaintiff's counsel filed a supplemental motion for attorney's fees for post-judgment proceedings on May 30, 2016 (Doc. 219). In this motion, Ms. Redwood seeks an additional $26, 657.50 in attorney's fees and expenses related to the time and expense involved in responding to Defendants' post-trial motions, as well as prospective fees for the time and expense associated with attending the June 6, 2016 settlement conference. Prudently, following the settlement conference, Ms. Redwood withdrew her unfounded request for doubled fees (Doc. 221).

         Plaintiff's motions regarding attorney's fees were referred to the undersigned and a hearing was held on September 6, 2016.[1]

         The Court has carefully considered the briefs of the parties, as well as the arguments made at the hearing and, for the reasons set forth below, Plaintiffs Petition for Attorney's Fees and Costs (Doc. 186) is DENIED as to the request for attorney fees. For the same reasons, Plaintiff's Supplementary Petition for Attorney's Fees for Post-Judgment Proceedings (Doc. 219) is DENIED.

         Because the Court of Appeals may disagree with the outcome of this Order regarding the denial of attorney's fees, an alternative analysis granting them is included[2]. In short, the request for attorney's fees in denied because:

Plaintiff's counsel has overreached and violated the Rules of Professional Conduct governing attorneys practicing in the State of Illinois and before this Court by attempting to charge an excessive fee in the instant case and this is not the first time she has done so;
The fee contract Plaintiffs counsel entered into with the Plaintiff violates the Rules of Professional Conduct because it does not delineate if costs are deducted before or after the contingent fee is calculated and because it permits counsel to collect fees against her client based upon breach, but does not give her client that reciprocal right;
Plaintiff's counsel's settlement evaluation, posture and demands made it clear she placed her pecuniary interest over her client's interests;
Plaintiff's counsel filed frivolous motions, and unnecessarily duplicated the proceedings, which inflicted unnecessary costs on her opponents and wasted the Court's time; and
Many of Plaintiffs counsel's claims of attorney time and costs are duplicative or unwarranted.

         The undersigned recognizes its decision to award no fees is extraordinary. It is the first time since joining the bench the undersigned has refused to award statutory fees.[3] But Plaintiffs counsel's unethical conduct, outrageous settlement demands and posturing, and frivolous filings coupled with her slash and burn litigation tactics warrant the conclusion.


         Legal Standard for Awarding Fees

         Title 42 U.S.C. § 1988 provides that in federal civil rights actions “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.” Blum v. Stenson, 465 U.S. 886, 888 (1984). A plaintiff may be considered a “prevailing party” if he “succeed[s] on any significant issue in litigation which achieves some of the benefit the part[y] sought in bringing suit.” Farrar v. Hobby, 506 U.S. 103, 109 (1992) (quoting Hensley, 461 U.S. at 433 (other quotation omitted)). In Farrar, the Supreme Court held that although a plaintiff who wins nominal damages is a prevailing party under § 1988, such nominal awards are significant in determining the reasonableness of a fee award. 506 U.S. at 114. Indeed, the Court held that in some circumstances a plaintiff who formally “prevails” should receive no attorney's fees at all. Id. at 115. In Aponte v. City of Chicago, the Seventh Circuit Court of Appeals indicated that Farrar may be appropriately applied in instances where a jury award is greater than $1.00. 728 F.3d 724, 728 (7th Cir. 2013). Section 1988's allowance for a “reasonable attorney's fee” contemplates “reasonable compensation, in light of all of the circumstances, for the time and effort expended by the attorney for the prevailing plaintiff, no more and no less.” Blanchard v. Bergeron, 489 U.S. 87, 93 (1989).

         Substantial settlement offers should be considered by the district court as a factor in determining an award of reasonable attorney's fees, even where Rule 68 does not apply. See Sheppard v. Riverview Nursing Center, Inc., 88 F.3d 1332, 1337 (4th Cir. 1996). Attorney's fees accumulated after a party rejects a substantial offer provide minimal benefit to the prevailing party, and thus a reasonable attorney's fee may be less than the lodestar calculation. See Marek v. Chesny, 473 U.S. 1, 11 (1985). As taught in Moriarty v. Svec, 233 F.3d 955, 967 (7th Cir. 2000), determining whether an offer is substantial is left in the first instance to the discretion of the district court. Nevertheless, an offer is substantial if, as in this case where the initial offer was $47, 500.00 and the jury verdict was $32, 092.00, the offered amount appears to be roughly equal to or more than the total damages recovered by the prevailing party. In such circumstances, a district court should reflect on whether to award only a percentage (including zero percent) of the attorney's fees that were incurred after the date of the settlement offer. The district court must only consider the substantial settlement offer; it need not reduce the lodestar calculation because of the offer. Moriarty stresses that a substantial offer is only one of the factors that a district court should evaluate in making an attorney's fee award, and (absent an offer complying with Rule 68 where that Rule applies) is not necessarily determinative. The district court may evaluate the settlement offer and decide that under the circumstances of a particular case an unadjusted lodestar method still provides a reasonable attorney's fee.

         In Vocca v. Playboy Hotel of Chicago, Inc., 686 F.2d 605 (7th Cir. 1982), the Seventh Circuit affirmed the district court's denial of fees in a suit brought pursuant to the Age Discrimination in Employment Act. In its opinion, the Court noted the plaintiff's counsel's refusal to settle the case at an earlier stage "for an amount only slightly less than the amount ultimately agreed upon" (in light of counsel's statements that the defendant could afford to pay more) and "inadequacies of counsel's fee schedule" (including failing to sufficiently describe the type of work performed and the identity and qualifications of the persons who performed the work and their normal billing rate). Id. at 608. However, the Seventh Circuit in Zabkowicz v. West Bend Co., Div. of Dart Industries, Inc., 789 F.2d 540 (7th Cir. 1986), departed from Vocca, finding that the district court's decision to deny the plaintiff's counsel any fees was an abuse of discretion. In Zabkowicz, the district court based its decision (at least in part) on the plaintiff's counsel's exaggeration of hours, significant flaws in the fee petition, and rejection of a settlement offer ($20, 000) that was significantly more than the plaintiff's award after a bench trial ($2, 763.20). The Seventh Circuit, in reversing the district court, noted that counsel's fee request ($127, 515) was not so egregious, or counsel's record keeping so inept, to warrant a complete denial of fees; however, the Court indicated that the district court was free to reduce the hours compensated to a number considered reasonable and could exclude hours based on inaccurate or misleading records. Id. at 550.

         Although related to denial of costs, rather than attorney's fees, the Court in Overbeek v. Heimbecker, 101 F.3d 1225 (7th Cir. 1996), upheld the district court's denial of costs in light of the prevailing party's counsel's repeated misconduct that subjected the court and the opposing party to a "decade of protracted and needless litigation." Also related to costs, a case out of the Northern District of Illinois, Fairley v. Andrews, No. 03-C-5207, 2008 WL 961592 (N.D. Ill. April 8, 2008), imposed a 64% reduction of costs based on defense counsel's misconduct in the first stage of the lawsuit wherein counsel was admonished for "engag[ing] in repeated obstreperous pretrial conduct." The misconduct was detailed in Fairley v. Andrews, 423 F.Supp.2d 800 (N.D. Ill. 2006).

         In assessing a request for attorney's fees, a court may properly reject unsatisfactorily supported claims of attorney's time and also consider whether an “attorney, by pressing questionable claims and refusing to settle except on outrageous terms, could force a defendant to incur substantial fees which he later uses as a basis for his own fee claim.” Mirabal v. General Motors Acceptance Corp., 576 F.2d 729, 731 (7th Cir. 1978).


         Discussion and analysis


         Plaintiff's Counsel Has Overreached By Attempting To Charge An Excessive Fee In The Instant Case And The Fee Contract Plaintiff's Counsel Entered Into With Plaintiff Violates The Rules of Professional Conduct Governing Illinois Lawyers

         The Court's conclusion that Plaintiff's counsel has overreached by attempting to charge an excessive fee is evidenced by her inexplicable and unsupported attempt to double her fee request from $397, 622.50 to $795, 245.00 and her charging a 40% contingent fee in addition to an inflated hourly rate of $450.00[4].

         In order to better determine Ms. Redwood's actual billing rates, she was ordered to provide the following documents to the Court for review prior to the Court's hearing on the motions seeking attorney's fees: (1) a copy of the attorney fee contract entered into with Mr. Capps[5]; and (2) copies of five itemized hourly fee bills, for different clients, for each year that Ms. Redwood represented Plaintiff in this matter (See Doc. 224). Upon review of the above-mentioned records, the Court finds the requested hourly rates for Ms. Redwood ($450.00 per hour) and her paralegal ($175.00 per hour) are unsubstantiated.

         First, Ms. Redwood failed to provide the Court with any documentation indicating that the billing rates she seeks are the actual billing rates she charges in similar litigation. Indeed, at the motion hearing, Ms. Redwood indicated that none of the billing statements provided were for Section 1983 cases. Moreover, the billing statements do not reflect an hourly rate that was bargained-for, charged and ultimately paid. Rather, Ms. Redwood received a retainer fee for each of the cases and backed-into the hourly rate by dividing the retainer amount by the number of hours expended on the matter. As such, the Court does not consider these statements to be evidence of actual billing rates charged in similar litigation.

         Further, Ms. Redwood's fee contract with Mr. Capps will not be considered as evidence of an appropriate billing rate as the undersigned found the contract unconscionable at the Motion Hearing for its apparent one-sidedness and failure to comply with the Illinois Rules of Professional Conduct. First, the contract allows Ms. Redwood to retain 40% of Mr. Capps' recovery, in addition to charging an hourly rate in the amount of $385.00. This violates the Illinois Rule of Professional Conduct's prohibition against charging an unreasonable fee. See Ill. Rules of Prof'l Conduct R. 1.5(a) (2010). Further, in violation of another subsection of this Rule, the contract fails to address whether expenses are to be deducted before or after the contingent fee is calculated. See Id. at 1.5(c). Moreover, the contract called for a $5, 000.00 retainer and only covered proceedings at the district court level. Lastly, contrary to case law, the contract indicates that if Ms. Redwood were to bring suit against Mr. Capps, he must pay Ms. Redwood's legal fees, but has no reciprocal requirement if Mr. Capps were to bring suit against Ms. Redwood. See Lustig v. Horn, 315 ...

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