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Plaintiff’s Attorney’s Fee Request Slashed because they “Transformed what should Have Been a Simple Case into a Discovery Nightmare” – eDiscovery Case Law


In Fair Housing Center of Southwest Michigan v. Hunt, No. 1:09-cv-593, 2013 U.S. Dist. (W.D. Mich. Oct. 21, 2013), Michigan Magistrate Judge Joseph G. Scoville ruled that the plaintiffs were prevailing parties in its settlement agreement with the defendants and were entitled to an award of attorney’s fees, but slashed the plaintiff’s fee request, “both because the hours devoted to this case were excessive and because the fee request makes no effort to account for the limited success that plaintiffs achieved in this case”.

In this housing discrimination case, the parties entered a settlement agreement that referred the question of attorney's fees and costs to magistrate Judge Scoville. The plaintiffs filed a motion seeking $605,507.92, consisting of $587,905.00 in attorneys’ fees and $17,602.92 in taxable costs. The defendants opposed the motion “on every possible ground”, contending that the plaintiffs did not enjoy “prevailing party” status entitling them to an award of attorney's fees and, if they were entitled to fees, that the amount sought was “grossly excessive”.

Noting that a prevailing party is one who achieves “a material alteration of the legal relationship of the parties”, Judge Scoville ruled that the plaintiffs are prevailing parties due to the court-approved Settlement Agreement, which awarded the plaintiffs a monetary award in the amount of $47,500.00.  Because the plaintiffs were ruled as prevailing parties, he also ruled that they were entitled to the full amount of the taxable costs because they were for transcript fees for depositions and hearings.

However, when it came to attorney’s fees of $587,905.00, Judge Scoville found that the “expenditure of 2,614 hours by three partners, two associates, and two paralegals” was “a truly extravagant expenditure of time and resources on what should have been a relatively simple case”.  He further noted:

“It is virtually impossible to see how the exercise of billing judgment would lead a law firm to invest 2,600 hours, by seven different billers, in the pursuit of such a simple case. A hardworking attorney lucky enough to bill 40 hours a week, 50 weeks per year, would bill only 2,000 hours per year. Thus, 2,600 hours represents significantly more than one year of attorney time, expended in pursuit of a single case, without distraction.”

Judge Scoville also noted that the plaintiff’s “single-minded focus on discovery of ESI engendered predictable disputes over discovery” and that it “appeared to this court on more than one occasion that plaintiffs were treating the case as a litigation workshop on discovery of ESI rather than a lawsuit.”

Judge Scoville stated that it “would be well within the court's discretion to deny plaintiffs' motion for attorney's fees in its entirety. This approach, however, would be unduly harsh under the specific facts of this case because plaintiffs were clearly prevailing parties on some claims and counsel's reasonable efforts should be compensated, even though their overall approach to the case was clearly excessive.”  Therefore, he applied several reductions of partner, associate and paralegal hours, reducing the total awarded to $223,444.80.

So, what do you think?  Should the full attorney’s fees have been awarded?  Or perhaps denied entirely?  Please share any comments you might have or if you’d like to know more about a particular topic.

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