Judge Calls Lawyers Greedy but Panel Approves Fees

Alyson M. Palmer

Daily Report

A federal appeals court has upheld more than $10.5 million in fees for lawyers who successfully challenged Georgia's foster care system -- but not before the judge who wrote the main opinion suggested that the lawyers were being greedy.

Judge Edward E. Carnes of the 11th U.S. Circuit Court of Appeals opened his stinging 68-page opinion by quoting John D. Rockefeller as reportedly saying "just a little bit more" money would be enough for him.

"The attorneys for the plaintiff class in this case want more than just a little bit more," Carnes wrote. "They want a lot more money than they would receive from multiplying the number of hours they worked on this case by the hourly rate they charge."

Those lawyers -- led by State Bar of Georgia President Jeffrey O. Bramlett of Bondurant, Mixson & Elmore and Marcia Robinson Lowry of Children's Rights Inc. -- just can't help themselves, suggested Carnes.

"The lodestar amount will never suffice for attorneys who practice in this area," wrote Carnes, referring to the Atlanta-area lawyers who weren't involved in the case but submitted affidavits in support of the bid for fees. "They will always believe, in all sincerity, that they deserve more and that the justice system will function better if they are paid more."

The other two members of the panel -- Judge Charles R. Wilson and Senior Judge James C. Hill -- issued separate opinions concurring in the result of the case. Wilson largely defended the award, while Hill hinted that the 11th Circuit might re-examine its precedents on how to award attorney fees in civil rights cases.

The lawyers for the class said they were glad the panel upheld the award issued by the trial judge in the case, and they defended their fee request. Cases like this one are very expensive to fight, said Lowry, noting that some of their costs cannot be recovered. Bramlett said lawyers who lay out costs to work on such cases need some reasonable expectation that they will be compensated when they win.

"I'm proud of my involvement in the case," Bramlett said Monday.

FOSTER CHILDREN

The fee dispute is the lingering issue in a long-running case filed against the state Department of Human Resources in June 2002. The suit on behalf of a class of all foster children in Fulton and DeKalb counties alleged systematic deficiencies in the counties' foster care systems.

The complaints were settled in 2005 by a consent decree that, among other things, mandated caseload limits for child welfare workers; instituted regular, reported visits by caseworkers to foster children; placed mistreated children in foster homes; granted comprehensive medical, dental and mental health care for children in state custody; and limited the placement of children in emergency shelters and group homes. Plaintiffs attorneys have calculated the deal as giving more than $168 million in benefits to the class. The settlement left open the issue of attorney fees, which the law allows plaintiffs lawyers to collect when they succeed in civil rights cases.

The plaintiffs attorneys requested more than $16 million in fees and expenses. Most of that figure came from nearly 30,000 hours they said had been spent on the case by lawyers and paralegals at rates from $75 to $495 per hour -- totaling $7,171,434. They asked the judge to double that figure, based on the complexity of the case, quality of service and potential for loss if they didn't prevail in the litigation.

The state had calculated that the lawyers deserved $2.9 million.

Ruling on the fees request in 2006, U.S. District Senior Judge Marvin H. Shoob gave the plaintiffs lawyers much, but not all, of what they had requested. He cut the bills to $6,012,802, agreeing with the state that some of the entries on the lawyers' billing records were vague and that the hours claims for certain tasks were excessive. But he then multiplied that by a factor of 1.75, citing the plaintiffs lawyers' "exceptional work and the exceptional result they achieved."

The appellate panel rejected two of the state's attacks on the fee award -- that Shoob should have reduced the claimed expenses and made a deeper cut into the time submitted -- although Carnes and Hill indicated through Carnes' opinion that they likely would have cut those further if they had been Shoob. The judges parted ways entirely on the propriety of the 75 percent enhancement of the award.

NO DAZZLING NEEDED

Writing a section of the opinion where he spoke for only himself, Carnes emphasized U.S. Supreme Court precedent indicating that only a rare and exceptional case justifies such an increased award.

It is not proper to increase the award based on quality of the lawyering, wrote Carnes, as that amounts to double counting of qualities captured by the hours billed or the hourly rates. That the lawyers had advanced the costs of the litigation is also not a reason, he wrote, saying that "is simply the nature of the beast." The Supreme Court has forbidden an increase based on the contingent nature of the fees, wrote Carnes, saying that amounts to double counting, too.

Basing a fee enhancement on the quality of the representation is particularly wrong given Shoob had found problems with the bills submitted, wrote Carnes. And rewarding particularly good lawyering doesn't make sense, he added, because either the plaintiff won what the law allows or he won more than the law allows, which is not to be rewarded.

"The purpose of the statutes, most assuredly," wrote Carnes, "is not to provide plaintiffs with representation that dazzles or bedazzles the district court judge."

Carnes also took issue with Shoob's reliance on affidavits from four lawyers -- Henry D. Fellows Jr. of Fellows LaBriola, Ralph I. Knowles Jr. of Doffermyre Shields Canfield & Knowles, John A. Chandler of Sutherland and James C. Rawls of McKenna Long & Aldridge -- that the plaintiffs attorneys submitted to bolster their fee requests. Those lawyers, he wrote, obviously had an interest in keeping fee awards in the case and others like it as high as possible because a higher fee award in the case would make it more useful as precedent for when they seek fee awards in their own cases.

Some cases might support an enhancement -- such as one in which the plaintiffs were so unpopular that the case could hurt the lawyer's career -- but this case was not one of those, said Carnes. Here, he said, Bramlett and Lowry understandably had touted the win on their Web sites, and Bramlett in 2007 was chosen to be the next president of the State Bar.

"Representing children who find themselves in foster care is not the same as representing activist atheists in the Bible Belt or pedophiles anywhere," Carnes wrote.

While the lawyers may have gained something, Carnes suggested that the clients may be hurt by the size of the award. "The perverse irony of the seven figure, court ordered gratuity in this case is that reduces the amount of state funds available to care for what Children's Rights itself has described as some of Georgia's 'most vulnerable citizens,'" wrote Carnes.

But Carnes concluded that 11th Circuit precedent forced the panel to uphold the award. Asking Shoob to look at the issue again would be futile, he wrote, because Shoob was "obviously enamored with the performance of plaintiffs' counsel and with the result that they achieved."

In his special concurrence, Wilson disagreed with Carnes' assessment that Shoob's decision was inconsistent with Supreme Court precedent, noting that performance-based enhancements are permissible under narrow circumstances.

Wilson emphasized that district court judges like Shoob are themselves experts on fee issues. And he said the 11th Circuit also had recognized that the public benefit created by a lawsuit is a factor that may be considered on fees.

"Given the scope of the remedial measures agreed to by the defendants," wrote Wilson, "the public benefit created by this litigation is enormous."

Hill's concurrence was much more brief, saying he had nothing to add other than to acknowledge that his colleagues' opinions were "scholarly and well done." He closed with a cryptic sentence that perhaps foreshadowed an en banc showdown to come: "No doubt these additional writings will be of interest to jurists who might wish to pursue the matter in further proceedings, should any arise."

LAWYERS REACT

Lowry on Monday said it's important that the lawyers receive a reasonable fee because there are certain costs they'll never be able to recover. "It is important to have these cases when there are real civil rights at issue to be adequately funded," said Lowry, who is executive director and founder of Children's Rights.

She said defendants frequently argue that fee awards take away from monies that might be spent to help the plaintiffs. But she said it was the unconstitutional nature of the foster care system that led the lawsuit to be filed, saying the state spent a great deal of its own money defending "what turned out to be an indefensible system."

Bramlett bristled at the suggestion that the fee award somehow will hurt the children the suit was meant to help. "With interest, the award now stands at approaching $13 million," said Bramlett, "and the agency's budget stands at about $3.1 billion. To suggest that the fee award reduces the state's ability to care for these children is utterly wrong. Dollars in the state's budget are fungible."

And he said it was "disingenuous" to suggest that Shoob's adjustments to the time billed undercut his conclusions that the lawyers had performed extraordinary service worthy of an enhancement. "Whenever you bill a project involving 30,000 hours of other human beings' time," said Bramlett, "it's not surprising that there's some adjustment that needed to be made."

Bramlett also defended those who had provided affidavits. "To suggest that those lawyers in particular acted out of financial self-interest is just outrageous," he said. And those lawyers stood by their support of the plaintiffs' case.

Fellows said he was "pleased" to support the plaintiffs, and Rawls similarly said he was "proud" to have that opportunity. Chandler noted that he primarily represents defendants, saying, "I have no interest in higher fee awards for plaintiffs at all." Knowles, too, stood by his offering: "I was asked to give an opinion, and I gave it, and I regret that Judges Carnes feels the way he does, but I haven't changed my mind."

Mark H. Cohen of Troutman Sanders argued the fees appeal for the state.

Russ Willard, a spokesman for Georgia Attorney General Thurbert E. Baker, on Monday left open the possibility of further litigation over the fees.

"We are reviewing the decision," said Willard, "and discussing options for further appeal with our clients."

The case is Kenny A. v. Perdue, Nos. 06-15514 and 06-15874.