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A federal magistrate judge has lopped off more than $400,000 from a fee request of a team from employment litigation firm Outten & Golden following the settlement of a discrimination case. Southern District of New York Magistrate Judge James C. Francis IV rejected the request of partner Kathleen Peratis for $1.4 million in fees, citing several reasons for ultimately awarding the firm slightly more than $1 million. Among the adjustments the magistrate judge made in Rozell v. Ross-Holst, 05 Civ. 2936, was to reduce the hourly fee request for Peratis to $600 from $675. Since 2001, Peratis has headed the sexual harassment group at Outten & Golden, which the magistrate judge said “enjoys a reputation as one of the outstanding firms representing plaintiffs in employment cases.” Peratis was the lead lawyer for plaintiff Mary Rozell, who was employed by Andco LLC to oversee the art collection co-owned by Andco principal Courtney Ross-Holst and the Ross Family Foundation. Rozell charged that the company’s chief financial officer, Neil Pirozzi, repeatedly touched her in a sexual manner and made numerous inappropriate comments to her. Rozell claimed Pirozzi fired her in retaliation for complaining about his actions to Ross-Holst. Rozell also claimed Pirozzi hacked into her e-mail account and accessed communications between her and her attorney. The defendants counterclaimed for trespass, saying Rozell allowed unauthorized persons into Ross-Holst’s apartment to view artwork. Rozell’s suit under Title VII of the Civil Rights Act of 1964, the Human Rights Laws of New York state and city, and the Electronic Communications Privacy Act ended with a settlement in 2007 on the eve of trial. The case was before Southern District of New York Judge John Koeltl. As part of the settlement, the parties agreed the claim for attorney fees would be submitted to Magistrate Judge Francis for resolution. The magistrate judge said that, without violating the confidentiality agreement between the parties, Rozell was “highly successful” in the litigation and “her monetary recovery can be fairly characterized as substantial.” The defendants raised a host of objections to the fee request, some of which persuaded Francis, who began by citing a recent decision by the 2nd U.S. Circuit Court of Appeals, in which the appellate court said it was abandoning the use of the term “lodestar,” Arbor Hill Concerned Citizens Neighborhood Association v. County of Albany, 522 F. 3d 182 (2d Cir. 2008). In Arbor Hill, the 2nd Circuit said the “better course” was for district judges to use their “considerable discretion, to bear in mind all of the case-specific variables that we and other courts have identified as relevant to the reasonableness of attorney’s fees in setting a reasonable hourly rate.” The defendants, represented by A. Michael Weber and Elena Paraskevas-Thadani of Littler Mendelson, claimed plaintiffs counsel should not be awarded fees for time spent on the Electronic Communications Privacy Act claim and the trespass counterclaim. Francis said the defendants were right in regards to the privacy act, which requires either a judicial finding or an admission of liability. But they were wrong, he said, on the trespass claim, which was “closely related to Ms. Rozell’s discrimination claim.” He agreed with the defense that “several of the tasks performed by plaintiffs counsel were unjustified,” including making a motion to dismiss the trespass counterclaim and then withdrawing it out of “futility,” and filing a memorandum with Koeltl that was filed “in contravention of Judge Koeltl’s directive.” RANCOROUS BEHAVIOR While Francis said the defendants complained about a number of motions that, “while unsuccessful, were part of the routine give-and-take of litigation,” he also credited, in part, their argument that the proceedings were “multiplied by the contentiousness of plaintiffs’ counsel.” After noting that Littler Mendelson attorneys bore “some responsibility for the rancor in this case,” he chopped 50 hours off the plaintiffs attorneys’ request. He said plaintiffs counsel responded to a witness missing a deposition because of illness by “demanding a court-ordered deposition schedule for all of the defendants’ witnesses,” and said they “refused to consent to an adjournment of the trial to accommodate the pregnancies and medical conditions of a witness and one of defendants counsel.” But the magistrate judge rejected the defendants’ assertion that plaintiffs counsel should not be compensated for time spent training and participating in a mock trial. He excluded a few hours here, because “training costs are customarily incorporated in a firm’s overhead,” but nonetheless said “it’s entirely proper, however, to bill a client for a mock trial exercise devoted to the case at hand.” The defendants also claimed the case was overstaffed and plaintiffs counsel spent too much time on almost every phase of the litigation. Francis agreed in part and disagreed in part, electing in the end to reduce by 15 percent the amount of hours submitted by counsel. In deciding to reduce the hourly rate for Peratis, the magistrate judge noted her impressive credentials and experience, but also noted that Peratis was awarded $500 an hour in 2006 in another case for work done over the preceding six years. Francis also viewed the case as relatively straightforward. “This was essentially a single plaintiff sexual harassment and retaliation case, complicated by the computer ‘hacking’ issue and by the extent of conflict between opposing counsel,” he said. In the end, Outten & Golden partners were compensated for 697 hours, senior associates for 1,243 hours, junior associates for 266 hours, law clerks for 248 hours and paralegals for 714 hours. Peratis was joined by Mark Humowiecki and Ossai Miazid in arguing the fee request.

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