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United States District Court, S.D. New York.
SANTA FE NATURAL TOBACCO CO., INC. Plaintiff,
v.
Eliot SPITZER, individually and in his official capacity as
Attorney General of
the State of New York, et al., Defendants.
BROWN & WILLIAMSON TOBACCO CORPORATION, and Bwtdirect, LLC,
Plaintiffs,
v.
George E. PATAKI, in his official capacity as Governor of the
State of New
York, et al., Defendants.
Nos. 00 Civ. 7274(LAP), 00 CIV 7750(LAP).
March 29, 2002.
MEMORANDUM AND ORDER
PRESKA, J.
*1 Plaintiffs move for attorneys' fees
as a prevailing party pursuant to 42
U.S.C. § 1988. Defendants concede for purposes of these motions that plaintiffs are prevailing parties within the
meaning of the statute and are entitled to recover reasonable fees and
disbursements. (Defendant' Memorandum of Law in Opposition to Plaintiffs'
Application for Attorneys' Fees dated October 22, 2001 ("Def.Br.") at
1). The only question presented is the reasonableness of such fees.
BACKGROUND
Plaintiffs Santa Fe Natural Tobacco Co., Inc.
("Santa Fe") and Brown & Williamson Tobacco Corporation and
BWTDirect, LLC (the "B & W Plaintiffs") commenced these actions
on or about September 26, 2000 and October 12, 2000, respectively, seeking a
declaration that Section
1399-11
of the New York Public Health Law violated the
Commerce Clause of the U.S. Constitution, an injunction prohibiting defendants
from enforcing the statute, and such further relief as the Court deemed proper,
including attorneys' fees, costs and expenses pursuant to Section
1988. On October 23, 2000, the First Scheduling
Order was issued setting dates for discovery, briefing, a preliminary
injunction hearing on November 27, 2000, and oral argument on December 13,
2000. The schedule contemplated an expedited, labor-intensive, and accelerated
process necessitated by (1) defendants' refusal to agree to stay enforcement of
Section 1399-11 for a few weeks pending a preliminary injunction hearing (thus
requiring plaintiffs to seek a temporary restraining order preventing the
statute from taking effect on November 14, 2000, as scheduled); and (2) defendants' refusal to consent to an extension
of the temporary restraining order, if issued (thus requiring plaintiffs to
conduct discovery under an accelerated schedule looking toward a preliminary
injunction decision following argument in mid-December 2000).
The TRO was issued on November 13, 2000 (Santa
Fe Natural Tobacco Co. v. Spitzer,
2000 WL 1694307 (S.D.N.Y. Nov. 13, 2000))--three
weeks after accelerated discovery under the First Scheduling Order had begun.
The next day, November 14, defendants offered to consent to a three-week
extension of the TRO to permit the parties to make fuller evidentiary showings
at the preliminary injunction hearing. The B & W Plaintiffs responded in a
letter on the same date that a longer extension should be granted to allow the
preliminary injunction hearing to be consolidated with the trial on the merits,
thereby obviating the need for a second evidentiary proceeding and a third oral
argument. On November 15, 2000, a Second Scheduling Order was issued setting
the preliminary injunction hearing for February 6, 2001, oral argument on March
9 (based on Defendants' consent to extend the TRO through March 16, 2001) and
reserving decision on consolidation.
On December 13, 2000, forty-five minutes
after B & W requested an order compelling depositions of certain State
staff counsel, counsel for defendants informed Covington & Burling ("C
& B"), counsel to the B & W Plaintiffs, that defendants would seek
to disqualify C & B as counsel to the B & W Plaintiffs. After consideration of letters on that topic, a
Third Scheduling Order was issued on January 17, 2001 scheduling briefing on
defendants' disqualification motion, argument on the motion on February 16,
2001, depositions and other discovery to resume at the beginning of March and
the preliminary injunction hearing to begin on April 30, 2001.
*2 On February 26, 2001, defendants'
disqualification motion was denied. Brown
& Williamson Tobacco Corp. v. Pataki,
152 F.Supp.2d 276 (S.D.N.Y.2001). In addressing
issues raised by that motion, I noted that the accelerated schedule in the case
was the result of defendants' request for expedited proceedings after issuance
of the TRO and that defendants' decision in that regard "is not without
consequences." Id.
at 290. I also noted that it was "clear that
[defendants] made a tactical decision at the outset [of the case] not to seek
... disqualification (or at least raise the issue) and instead chose to pursue
expedited proceedings" and that defendants, having done so, "must
accept the consequence." Id.
On April 24, 2001, over the objection of
defendants, the trial on the merits was consolidated with the preliminary
injunction hearing, and a five-day bench trial commenced on April 30, 2001.
Oral argument was held on May 30, 2001, and on June 8, 2001, an opinion was
issued holding Section 1399-11 unconstitutional and permanently enjoining
defendants from enforcing it. Santa
Fe Natural Tobacco Co. v. Spitzer,
2001 WL 636441 (S.D.N.Y. June 8, 2001).
Santa Fe now applies for reimbursement of some $600,000 paid to
its attorneys, Salans Hertzfeld Heilbronn Christy & Viner (the "Salans
firm"), Enns & Archer, LLP (the "Enns firm") and Kilpatrick
Stockton (the "Kilpatrick firm"), and the B & W Plaintiffs apply
for reimbursement of some $3.1 million in fees and disbursements paid to their
attorneys, C & B and King & Spaulding ("K & S").
DISCUSSION
42
U.S.C. § 1988(b) provides that "... the court, in its discretion, may
allow the prevailing party ... a reasonable attorney's fee as part of the
costs...." The district court is given broad discretion in assessing a
reasonable attorney's fee based on the circumstances of each case and is
advised not to undertake a tedious analysis of every aspect of the attorney's
representation. See Hensley
v. Eckerhart,
461 U.S. 424, 437 (1983); see also New
York State Ass'n for Retarded Children, Inc. v. Carey,
711 F.2d 1136, 1146 (2d Cir.1983) ("In assessing
the extent of staffing and background research appropriate for a given case, a
district court must be accorded ample discretion.").
Within the Second Circuit, the lodestar
method may be used to ascertain attorney's fees in civil rights cases. See
Quararino
v. Tiffany & Co.,
166 F.3d 422 (2d Cir.1999); see also Goldberger
v. Integrated Resources, Inc.,
209 F.3d 43, 45 (2d Cir.2000) (either lodestar or
"percentage of the recovery" method may be used in common fund
cases). The lodestar method calculates fees by
using the product of the number of hours reasonably expended by each attorney
and the reasonable hourly rate. See Hensley,
461 U.S. at 437; Quararino, 166 F.2d at
425; Gavin-Mouklas v. Information Builders, Inc., No. 97 Civ. 3085(LAP),
1999
WL 728636, at super* 2 (S.D.N.Y. Sept. 17, 1999)
(internal quotations omitted). Plaintiffs have the burden of demonstrating that
the rates requested and the number of hours expended was reasonable. See
Stratton v. Department for the Aging, No. 91 Civ. 6623(SAS), 1996
WL 352909, at super* 2- super* 3 (S.D.N.Y. June 25, 1996) (citing Hensley,
461 U.S. at 433-34). "Counsel for the
prevailing party should make a good fath effort to exclude from a fee request
hours that are excessive, redundant, or otherwise unnecessary...." Hensley,
461 U.S. at 434.
*3 To assess the reasonableness of the
time expended by an attorney, the court must look first to the time and work as
they are documented by the attorney's records. See Forschner Group,
Inc. v. Arrow Trading Co., Inc., No. 92 Civ. 6953(LAP), 1998
WL 879710, at super* 2 (S.D.N.Y. Dec. 15, 1998).
Next the court looks to "its own familiarity with the case and its
experience generally.... Because attorneys' fees are dependent on the unique
facts of each case, the resolution of the issue is committed to the discretion
of the district court." AFP Imaging Corp. v. Phillips Medizin Sys.,
No. 92 Civ. 6211(LMM), 1994
WL 698322, at super* 1 (S .D.N.Y. Dec. 13, 1994)
(quoting Clarke
v. Frank,
960 F.2d 1146, 1153 (2d Cir.1992) (quoting DiFilippo
v. Morizio,
759 F.2d 231, 236 (2d Cir.1985))).
To assess the reasonableness of the billing
rates employed, courts look to market rates " 'prevailing in the community
for similar services by lawyers of reasonable comparable skill, experience and
reputation." ' Gierlinger
v. Gleason,
160 F.3d 858, 852 (2d Cir.1998) (quoting Blum
v. Stenson,
465 U.S. 886, 896 n. 11 (1984)); see Carey,
711 F.2d at 1151. Because this action was
litigated in the Southern District of New York, the prevailing community rates
would normally be those of Manhattan attorneys of reasonably comparable skill
and experience for similar litigation. See Polk
v. New York State Dep't of Correctional Serv.,
722 F.2d 23, 25 (2d Cir.1983); Gavin-Mouklas,
1999 WL 728636, at super* 2. Here, as to those
timekeepers based in Manhattan, I have considered prevailing Manhattan rates
for comparable counsel. Plaintiffs' fee requests for timekeepers located other
than in Manhattan are based on those timekeepers' regular, non-Manhattan
billing rates--rates which, not surprisingly, are lower than Manhattan rates.
Accordingly, I have considered the rates requested by out-of-town counsel in
comparison to comparable lawyers in the relevant out-of-town location. In
determining the prevailing rate, courts also factor in the size of the law firm
involved; lawyers at large firms generally recover more per hour than lawyers
at small firms. Chambers
v. Masters,
885 F.2d 1053, 1059 (2d Cir.1989). In addition,
district court judges may rely on their own
knowledge of rates charged by lawyers in the district. E.g., Miele
v. New York State Teamsters Conference Pension & Retirement Fund,
831 F.2d 407, 409 (2d Cir.1987).
Finally, billing judgment must be factored
into the equation. Hensley,
461 U.S. at 434; DiFilippo,
759 F.2d at 235-36. If a court finds that the fee
applicant's claim is excessive, or that time spent was wasteful or duplicative,
it may decrease or disallow certain hours or, where the application for fees is
voluminous, order an across-the-board percentage reduction in compensable
hours. In
re "Agent Orange" Products Liab. Litig.,
818 F.2d 226, 237 (2d Cir.1987) (stating that
"in cases in which substantial numbers of voluminous fee petitions are
filed, the district court has the authority to make across- the-board
percentage cuts in hours 'as a practical means of trimming fat from a fee
application" ' (quoting Carey,
711 F.2d at 1146)); see also United
States Football League v. National Football League,
887 F.2d 408, 415 (2d Cir.1989) (approving a
percentage reduction of total fee award to account for vagueness in
documentation of certain time entries).
*4 The determination of the final
"lodestar" amount is not necessarily the end of the inquiry; in some
cases where constitutional claims are involved, the court may adjust the
lodestar amount based on a variety of factors. Hensley,
461 U.S. at 434; see, e.g., Johnson
v. Georgia Highway Express, Inc.,
488 F.2d 714, 717-19 (5th Cir.1974); Foster
v. Kings Park Cent. School Dist., 174
F.R.D. 19 (E.D.N.Y.1997). These factors are (1)
the time and labor required; (2) the novelty and difficulty of the question;
(3) the skill requisite to perform the legal service properly; (4) the
preclusion of other employment by the attorney due to acceptance of the case;
(5) the customary fee; (6) whether the fee is fixed or contingent; (7) time
limitations imposed by the client or the circumstances; (8) the amount involved
and the results obtained; (9) the experience, reputation and ability of the
attorney; (10) the "undesirability" of the case; (11) the nature and
length of the professional relationship with the client; and (12) awards in
similar cases. Foster,
174 F.R.D. at 27. With all of the above
considerations in mind, I turn to the litigation at hand.
It is with abundant understatement that
defendants acknowledge that the litigation "was fast-paced and, at times,
challenging," (Def. Br. at 1), and that the effort involved was "not
insubstantial," (Id. at 2). The factual inquiries were novel and
complex. They included, for example, review of reams of statistical studies
purporting to show a relationship between, for example, (1) the cost of
cigarettes and demand among particular age groups, (2) the cost of cigarettes
and the volume of cross-border sales, and (3) enforcement of a variety of
tobacco-related regulations and demand among particular age groups. Inquiry
into the legislative history of the statute was also required. The legal issues
presented were equally complex, involving, for example, sophisticated Commerce Clause analysis, inquiry
into New York State tax regulations and United States Postal Service regulations
as applied to cigarettes and questions of State Executive privilege. Also
presented on the disqualification motion was an issue of first impression of
who is the client in a governmental context. See Roy Simon, Simon's New
York Code of Professional Responsibility Annotated 473-74 (2002). In my
judgment, the factual and legal issues presented in this action were far more
challenging than those presented in the normal civil rights case. See Foster,
174 F .R.D. at 19 (considering novelty and
difficulty of the question presented).
Defendants are correct that the action was
"fast-paced" and the effort expended "not insubstantial."
However, a good deal of the substance of the litigation, for example, the TRO
motion and the disqualification motion--and the pace of the litigation, which
can only be described as breakneck--were necessitated by defendants' tactical
decisions. As noted above, defendants would not agree to stay enforcement of
the statute, thus necessitating the TRO motion, and would only agree to
extension of the TRO for limited periods, thus necessitating the breakneck
pace. As also noted above, the defendants' decision not to move to disqualify C
& B at the outset but to do so in the middle of an already intense
litigation certainly multiplied the proceedings. These tactical decisions of
defendants increased the cost of the litigation to plaintiffs. See id.
(considering the time and labor required and time limitations imposed by the circumstances).
*5 The experience, reputation and
ability of plaintiffs' counsel, also a Foster
factor, were all first rate. All of the counsel involved in the action are
presently [FN1] large firm practitioners, thus commanding higher rates in
general. Chambers,
885 F.2d at 1059. As set forth more specifically
below, the attorneys involved here demonstrated the highest level of
experience, expertise and ability in litigating this action. [FN2]
FN1. I include Mr.
Enns in this category because he departed from a large firm in the midst of
this litigation and is for these purposes, in history, experience and performance,
a large firm lawyer.
FN2. I note
parenthetically that defendants' counsel also litigated the action at a high
level of professional competence--far beyond that encountered in most civil
rights cases.
Another Foster factor is the result
obtained. Here the result was spectacular; counsel obtained all the relief
sought in record time under difficult circumstances. It was a result private
clients would be, and apparently were, happy to pay for, a result made more
likely by utilization of top-of-the-line litigators who, from my review of the
contemporaneous time entries and summaries,
left no stone unturned. This maximum force litigation effort, while admirable
and highly effective here, in some instances was above and beyond the standard
of reasonableness applicable under § 1988. Section
1988 authorizes the reimbursement of reasonable
fees and expenses, not reimbursement of fees and expenses necessary to maximize
the chances of success. Here, where I am being asked to shift the plaintiffs'
costs of this litigation to the People of the State of New York, I must adhere
to the reasonableness standard of § 1988 and heed
the Court of Appeals' caution that attorney's fees are to be awarded "
'with an "eye to moderation," ' seeking to avoid either the reality
or the appearance of awarding 'windfalls." ' Evans
v. State of Connecticut,
967 F.Supp. 673, 691 (D.Conn.1997) (quoting Beazer
v. New York City Transit Authority,
558 F.2d 97, 101 (2d Cir.1977)).
Based on the record on these motions and my
own knowledge of billing rates, plaintiffs have demonstrated the reasonableness
of the rates applicable to all of the timekeepers at issue (after counsel's
billing judgment reductions). Although the rates are higher than those commonly
seen in civil rights litigation, the issues presented, both factual and legal,
were far more complex than those commonly seen. [FN3] With minor
exceptions (for example, describing tasks as "odds and ends" (Remes
Decl. Ex. D, December 2000 time sheets, line 184)), counsel's contemporaneous
time records comply with the requirements of
Carey, 711 F.2d 1138, that is, they "overall are sufficiently
detailed to allow the court to assess the reasonableness of the time
spent," Burr
v. Sobel,
748 F.Supp. 97, 100 (S.D.N.Y.1990). The only
question, then, is the number of hours reasonably expended, a question that in
some instances includes the number of attorneys involved. Because of the volume
of the time sheets submitted, I will not detail each individual time entry (or
part of an entry) here but will focus on the "big picture," id.,
and adjust the hours to meet the reasonableness standard of § 1988 by means
of across- the-board percentage cuts, where appropriate, see In
re "Agent Orange",
818 F.2d at 237 (quoting Carey ); United
States Football League,
887 F.2d at 415.
FN3. Although
quantity does not necessarily correspond with complexity, I note that some
twenty-two depositions were taken in this action, five of experts, over 60,000
pages of documents were produced, 477 exhibits proffered and a week-long trial
held. See Velie Supp. Decl. ¶ 6.
SANTA FE
The Enns Firm
*6 As set out in the Declaration of
Rodrick J. Enns executed on July 27, 2001 ("Enns Decl."), when this
action arose, Mr. Enns was a partner at the Kilpatrick
firm, a large firm with offices throughout the Southeast and in Europe. He
withdrew from that firm effective February 1, 2001, and formed the Enns firm,
but several Kilpatrick attorneys and paralegals continued to work on the matter
under Mr. Enns' supervision. (Enns Decl. ¶
6). Santa Fe seeks reimbursement of $272,536.75 in fees and $28,107.95
in disbursements paid to the Kilpatrick and Enns firms, (Enns Decl. Exs. A
& B; Enns Supplemental Declaration executed November 5, 2001 ("Enns
Supp. Decl.") Ex. A)).
Mr. Enns, the attorney primarily responsible
for this action for Santa Fe, is a 1979 law school graduate with extensive
commercial litigation experience, primarily in matters relating to marketing
and distributing consumer products. He has also represented Santa Fe in
constitutional challenges to cigarette licensing laws in two other
jurisdictions. (Enns Decl. ¶ ¶ 4-5).
His billing rate was $305 per hour, both at the Kilpatrick firm and at the Enns
firm, (Enns Decl. Exs. A & B; Enns Supp. Decl. Ex. A).
Defendants do not object to any aspect of the
Kilpatrick or Enns firms' fees or disbursements. I have reviewed the
contemporaneous time and disbursement records and find them to be reasonable in
all respects.
The Salans Firm
Santa Fe retained the Salans Firm as local
counsel in this matter. Franklin B. Velie, the attorney primarily responsible,
has thirty years experience as a litigator, including experience in
constitutional litigation. He served as an Assistant
United States Attorney in the Southern District of New York from 1971 to 1975
where he became Assistant Chief of the Criminal Division. Mr. Velie's billing
rates were $450 per hour until January 2001 and $500 thereafter. Mr. Velie, inter
alia, supervised attorneys at the Salans firm, defended the two
depositions of Santa Fe's expert witness, Fred Dunbar, and served as trial
counsel. (Declaration of Franklin B. Velie in Support of Petition executed July
31, 2001 (the "Velie Decl.") ¶
4; Reply and Supplemental Declaration of Franklin B. Velie executed
November 7, 2001 (the "Velie Supp. Decl.") ¶ ¶ 12, 28).
Dierdre A. Burgman, the Salans firm attorney
who also billed significant time on this matter, holds a Master of Laws degree
and has practiced for 21 years. Ms. Burgman has worked at two large Manhattan
firms, served as general counsel at the New York State Urban Development
Corporation and as Deputy Inspector General for New York State and was named
counsel for the Salans firm on October 1, 2000. Her experience includes
numerous constitutional cases, most dealing with the Commerce Clause, and she
has authored a variety of articles on constitutional law topics. (Id.
¶ 5). Her billing rates during the
pendency of the action were $250 per hour (through September 30, 2000), $285
(through December 31, 2000) and $305 thereafter. She had primary responsibility
for depositions and participated in trial preparation in this action. (Id.).
*7 Associate time (which comprised only
46.6 hours) was billed at rates from $180 to
$330 per hour. Paralegal and clerk time was billed at $135 and $145 per hour. (Id.
¶ ¶ 3, 6, 7, 9). Santa Fe seeks
$314,072.99 in fees and $29,847.92 in disbursements paid to the Salens firm
(Velie Decl. Ex. B; Velie Supp. Decl. Ex. B).
As explained by Mr. Enns, Santa Fe's intent
in engaging Mr. Velie was to retain counsel "who could most effectively
present Santa Fe's position in the local forum" and work closely with Mr.
Enns in managing the litigation effectively. (Enns Supp. Decl. ¶ 3). He explained that
Mr. Velie's background with the U.S. Attorney's Office and
his subsequent distinguished career as a commercial litigator made clear to us
that he not only possesses the requisite knowledge of local rules and
procedures, but is an extraordinarily skilled courtroom lawyer. He also
expressed complete willingness to work closely with me in managing the case
efficiently.
(Enns Supp. Decl. ¶ 4).
In hindsight, Mr. Enns' evaluation was as
follows:
My experience in working with Mr. Velie and [the] Salans
[firm] during the course of this litigation not only confirmed, but exceeded my
expectations. We were able to form a very effective working relationship, and
Mr. Velie's judgment, experience, knowledge of the forum, and courtroom skills
all proved invaluable. As an unexpected bonus, Mr. Velie involved Ms. Burgman
in this case, who is not only a skilled researcher, writer, and litigator, but
has substantial experience with New York
state government and specifically with constitutional litigation involving the
State which proved to be most valuable.
(Enns Supp. Decl. ¶ 5). Having reviewed the time and billing
records of the Salans Firm and observed Mr. Velie's performance at the trial
and in the other court proceedings in this action and the papers submitted on
behalf of Santa Fe, I agree with Mr. Enns' evaluation.
Defendants do not object to the number of
hours billed by the Salans firm. I have reviewed the contemporaneous time
records and find that they reflect a high level of efficiency and are entirely
reasonable.
Defendants do object to the hourly rates
billed by the Salans firm. Based on the material in the record and on my own
knowledge of firm billing rates, however, I find the rates of all of the
timekeepers at the Salans firm to be entirely reasonable for large-firm
Manhattan practitioners in light of Mr. Velie's and Ms. Burgman's high level of
experience, expertise and performance and in light of the complex legal and
factual issues presented here. (See Declaration of Lawrence Silverman in
Support of the Petition executed July 31, 2001 (the "Silverman
Decl."), Ex. B (RLS Legal Services, Inc. listing of rates requested by
large New York firms); Velie Supp. Decl. Ex. A (A Firm-by-Firm Sampling of
Billing Rates Nationwide, Nat'l Law J., Dec. 18, 2000, at B14); Blue
Cross & Blue Shield v. Philip Morris, No. 98 CV 3287(JBW), 2002
WL 397224, at super* 15 (E.D.N.Y. Feb. 28, 2002)
(awarding fee based on average partner
billing rate of $540 per hour for large New York firms in complex case).
*8 Defendants have not objected to the
disbursements of the Salans Firm. I have reviewed them and find them to be reasonable
in all respects.
BROWN & WILLIAMSON
King & Spaulding
As set out in the Declaration of Dan H.
Willoughby, Jr., sworn to on July 27, 2001 (the "Willoughby Decl."),
K & S assisted C & B with the discovery issues in this action. Rates
for attorneys ranged from $115 to $235 per hour, and rates for paralegals and
clerks ranged from $50 to $124 per hour. B & W seeks $79,781.25 in fees and
$41.52 in disbursements (Willoughby Decl. ¶ ¶
10-11). Defendants do not object to the rates utilized or the hours
billed. I have reviewed the time and disbursement records and find them to be
reasonable in all respects.
Covington & Burling
As set out in the Declaration of David H.
Remes in Support of the B & W Plaintiffs' Motion (the "Remes
Decl.") and the Silverman Decl., the B & W plaintiffs seek $2,770,560
in fees and $311,752 in expenses paid to C & B. (Remes Decl. ¶ 9). C & B did not bill the B & W
plaintiffs, and those plaintiffs do not seek to recover on this application
$575,505 in fees and $27,257 in expenses (17.2% of C & B fees and 8.7% of C
& B expenses) reflecting C & B's
removal of redundant or unnecessary items and its billing judgment reductions
and fees and expenses paid by another potential plaintiff prior to filing the
complaint. (Remes Decl. ¶ 10).
Mr. Remes, the C & B partner primarily
responsible for the action, is based in Washington, D.C., is a 1979 law school
graduate and has represented tobacco industry clients in a variety of matters
over the years, including in cases in the Supreme Court. (Id. ¶ 3). Although C & B raised his billing
rate during the pendency of this action, his time on this matter was billed at
$390 per hour throughout. A total of 10.5% of his time was written off, thus
lowering his effective rate. (Id., Ex. A).
Throughout these proceedings, Mr. Remes
demonstrated an extraordinary depth of knowledge of the issues raised, both the
factual issues involving the tobacco industry and the legal issues involving
the Commerce Clause and internet regulation. This demonstrated expertise
apparently arose from Mr. Remes' experience with these issues and his and C
& B's long-time representation of B & W. Even comparing his billing
rate to comparable Washington, D.C.-based attorneys, his billing rate on this
matter can only be considered a bargain.
Laurence Silverman, the C & B partner
primarily in charge of discovery and conduct of the trial, is based in New
York, is a 1977 law school graduate and has significant commercial litigation
experience. (Silverman Decl. Ex. A). During the pendency of this action, his
billing rate was $525 (four months), $575
(seven months) and $487.50 (two months). Of his total time charges, 25.6% was
written off, thus lowering his effective rate. (Remes Decl. ¶ 11 & Ex. A).
Patricia A. Barald, a C & B Washington
partner and a 1973 law school graduate, worked primarily on the economic issues
in the case, such as price elasticity and cross-border sales, and legal issues
relating to Indian tribes and the U.S. Postal Service. She is experienced in, inter
alia, tobacco regulation issues and Commerce Clause jurisprudence. Her
billing rates were $350 per hour for six months and $400 (eight months), and
21.4% of her time was written off. (Remes Decl. ¶ 13 & Ex. A).
*9 Rates for other partners and
counsel who billed time ranged primarily from $350 to $575, all with varying
write-offs. Rates for associates ranged from $90 to $375, with varying
write-offs, and for paralegals, law clerks, court clerks, librarians, and the
like from $48 to $140, with varying write- offs.
As noted above, the applicable rates after
write-offs are reasonable for counsel (and other timekeepers) of this
experience and level of performance on a matter of this complexity, based on my
own knowledge of billing rates and on the material in the record showing rates
of other large law firms experienced in complex litigation in Washington and
New York. (See Remes Decl. Ex. C (RLS Legal Services, Inc. listing of
rates requested by various Washington, D.C.- based firms); Silverman Decl. Ex.
B (RLS Legal Services, Inc. listing of rates requested
by various New York-based firms); Velie Supp. Decl. Ex. A (A Firm-by- Firm
Sampling of Billing Rates Nationwide, Nat'l Law J., Dec. 18, 2000, at
B14)); Blue
Cross,
2002 WL 397224, at super* 15 (awarding fee based
on average partner billing rate of $540 per hour for large New York firm in
complex case)).
The number of hours billed, however, is a
different matter. Private clients can, of course, agree to pay for any number
of lawyers and hours on a matter. Indeed, the plaintiffs here were no doubt
delighted with the superlative results expeditiously achieved and have paid the
bills as rendered. As noted above, however, the standard under Section
1988 is more moderate and, in my view, does not
contemplate the "deep bench" approach to litigation staffing.
Although the deep bench approach might well be commercially acceptable under
circumstances such as those presented in this action, it is not widely
accepted, even in commercial matters, [FN4] and is
certainly not within the reasonableness standard of Section
1988.
FN4. I am aware that
numerous large commercial consumers of legal services have written guidelines
for counsel that, absent prior consent, limit the number of lawyers in
attendance at court appearances, depositions, etc.
Practice of the deep bench theory is apparent in many of C &
B's time entries. For example, I note that the C & B time records indicate
that in preparation for and participation in the roughly one-hour
teleconference on December 15, 2000 (which involved plaintiffs' unsuccessful
attempt to take the depositions of certain State staff counsel), five attorneys
billed some 46.8 hours as follows:
Silverman 12/14 10.5 hours
12/15 9.0
Remes 12/15 10.0
Gimbel 12/15 5.0
Svirsky 12/15 6.0
Danzig 12/14 11.3
12/15 5.0
For the April 24 argument on the standard to be applied, four lawyers billed some 50 hours as follows:
Silverman 11.5 hours
Remes 6.5
Udell 15.5
Duke 16.5
At the Heronimas deposition on November 13, Messrs. Remes and Silverman, the two most senior C & B lawyers on the case, billed a total of some 22 hours, together with additional time by an associate for preparation. These and other examples of multiple lawyers where fewer would be reasonable convince me that a 20% reduction in C & B's fee is appropriate. See In re "Agent Orange", 818 F.2d at 237 (authorizing across-the-board percentage cuts in hours "as a practical means of trimming fat from a fee application") (quoting Carey, 711 F.2d at 1146).
*10 I have considered defendants'
other arguments as to redactions, vagueness of time entries, block billing,
uncalled witnesses and the like and find them to be without merit. I
specifically reject defendants' suggestion that a greater reduction in the
number of hours is appropriate. As noted above, defendants'
tactical decisions multiplied the tasks--and thus the number of
hours--reasonably required to litigate this action.
Finally, defendants do not object to C &
B's disbursements. I have reviewed those disbursements and find them to be
reasonable in all respects.
CONCLUSION
Plaintiffs are prevailing parties and are
awarded the following fees and disbursements through October 31, 2001 pursuant
to 42
U.S.C. § 1988:
Fees Disbursements
--------------
Santa Fe
The Kilpatrick firm $ 171,719.25 $ 14,271.51
The Enns firm 100,817.50 13,836.44
The Salans firm 314,072.99 29,847.82
_____________ ____________
Total: $ 586,609.74 $ 57,955.77
Brown & Williamson
King & Spaulding $ 79,781.25 $ 41.52
Covington & Burling 2,216,448.00 311,752.00
--------------
Total: $ 2,296,229.25 $ 311,793.52
SO ORDERED
2002 WL 498631 (S.D.N.Y.)
END OF DOCUMENT