The Second Circuit may finally be finished with this attorneys’ fee/lodestar case, one year (and two amendments) after the original panel decision was released: Arbor Hill Concerned Citizens Neighborhood Ass’n v. County of Albany, No. 06-0086 (2d Cir. Apr. 10, 2008).
The essence of the case was that the N.Y.C. giant Gibson, Dunn & Crutcher represented the plaintiff successfully in Voting Rights Act litigation in Albany, NY, and applied for its lodestar using Manhattan rates. The district court significantly reduced the lodestar, holding that even big New York firms were bound by the “forum rule,” which in gross provides that the “prevailing rate” for fees is the rate charged locally. And Albany attorneys apparently charge lots less per hour for their time.
In April 24, 2007, a panel of the Second Circuit (featuring retired Justice O’Connor, along with Chief Judge Jacobs and Judge Walker) affirmed the decision. Although it rejected the district court’s strict application of the “forum rule,” it affirmed the reduced award on an alternative analysis: that out-of-town counsel bore the burden of proving that a paying local client would have engaged the petitioning firm at higher, out-of-town rates. The panel also held that a court could take into account the non-financial benefits that attorneys obtain from such public-interest cases (enhancement of reputation, a warm feeling of benevolence, etc.) in driving down the lodestar further still.
The howls from the Manhattan canyons were deafening — abetted (understandably) by the public-interest bar, which depends on recruiting big-city lawyers to travel to the boonies (like New York’s state capital!), work out of chain-hotels and eat the same crappy food that the rest of the country eats. The din led to an oh-so-slightly softened opinion (issued July 12, 2007), with the same bottom-line conclusion but adding a new footnote n.2 with a sop to the bars’ right to obtain fees, even if the undertaking was originally pro bon.
This second amended opinion today is not drastically different from the last one, but adds a couple of more things of note. First it expands footnote two, now recognizing explicitly under Blum v. Stenson, 465 U.S. 886 (1984), the right to be paid for cases originally undertaken pro bon. Second, it sanded down some harsh language at the beginning and end of the opinion, which originally suggested that an attorney who pursues litigation for personal reasons (a revulsion for racism in a harassment case, for instance) ought to get a lower lodestar. The panel now says that whether an attorney “might” have been willing to take a case at a lower rate, owing to such a personal interest, is simply a factor in the overall equation.
Message still seems to be: don’t ever give any of your time away; charge market rates; make sure that your far-flung public-interest clients can say with a straight face that you’re the only lawyer who could do the job.