Recent Developments in Attorney Fees Awards in The Eastern District of New York

In two recent cases, judges in the United States District Court for the Eastern District of New York have shown flexibility and a practical approach in determining fee awards, rather than applying strict tests.

For example, on December 5, 2013, Judge Spatt issued a decision in Long Island Head Start Child Development Services, Inc. v. Economic Opportunity Commission, 00 CV 7394, in which he held that a claim for appellate attorneys’ fees under ERISA’s fee shifting provisions was not subject to the 14-day deadline set forth in Federal Rule of Civil Procedure 54(d)(2)(B). Under that Rule, a motion for an award of attorneys’ fees must be brought “no later than 14 days after the entry of judgment.” After prevailing on appeal, the plaintiff made a motion for a fee award more than two months after the Second Circuit issued its mandate. Judge Spatt held that since neither the Federal Rules of Appellate Procedure nor the Second Circuit’s local rules contained a deadline, the fee motion had only to be made within a reasonable period, which he deemed was done in this case.

In another recent example, Judge Cogan issued a decision on December 30, 2013, in Animal Science Products, Inc. v. Hebei Welcome Pharmaceutical Co. Ltd., which granted in part plaintiffs’ request for attorneys’ fees under the Clayton Act, to the extent of awarding over $4 million in the fees requested. The case had lasted seven years and was a multi-district anti-trust class action alleging price fixing of vitamins by Chinese manufacturers. After settling with two of the defendants, plaintiffs prevailed at trial against the remaining ones and obtained a verdict in excess of a $100 million.

Although he cut other aspects of the fee request, the most striking part of the decision was that the Court rejected the defendants’ arguments that they should not pay plaintiffs’ counsel’s hourly rates, because while perhaps common in the pricier SDNY, they were higher than the rates usually and normally charged by lawyers located in the EDNY. The Court rejected the rule of thumb rule of looking to rates within the district because it found the case involved factual and legal issues that “have never been considered in this district and very possibly would be unique anywhere,” and required that “extraordinary” resources “be brought to bear to prosecute the case.” Slip op. at 3. The Court further found that there was “no plaintiffs’ class action firm with the capacity to deal with a case of this magnitude resident within this district.” Slip op. at 4.

We welcome suggestions regarding court decisions, upcoming oral arguments or other developments in the area of litigation in the Commercial Division of the New York State Courts or the Eastern District of New York that we should blog about.

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