Four law firms that submitted a “grossly inflated” $2.7 million fee request after winning $12,500 for their client should go away empty-handed, a federal judge has ruled.
Eastern District Judge Joanna Seybert (See Profile), sitting in Central Islip, condemned the fee application submitted by real estate investor Robert Toussie’s attorneys, including $2.65 million for Chadbourne & Parke, as “outrageously excessive” and done in “bad faith.”
“Counsel have so grossly inflated their fee application to a figure more than 200 times Toussie’s recovery—by ignoring prior directives of [Magistrate Judge Arlene] Lindsay, seeking fees related to claims on which Plaintiffs obviously did not prevail, misrepresenting the total number of hours billed, and providing extraordinarily vague descriptions of billable hours in block time entries such that the Court cannot even begin to determine how many hours were actually spent on Toussie’s successful claims—in the hopes that the Court would award even a small fraction of that. Such conduct will not be tolerated,” Seybert wrote in Toussie v. County of Suffolk, 01-cv-6716. She denied the request entirely.
Chadbourne & Parke’s trial team included Abbe Lowell. Lowell also requested almost $18,709 for his work while he was at McDermott Will & Emery.
Other firms requesting fees included Williams & Connolly, just over $131,000; and Hamburger, Maxson, Yaffe, Knauer & McNally of Melville for $12,710.
The judge’s Sept. 6 ruling stems from a suit Toussie filed in 2001 arguing his civil rights had been violated when Suffolk County denied him and his company the opportunity to buy land at auction.
A second suit filed in 2005 claimed the county violated the civil rights of Toussie, his family and others by blocking sales at a 2002 auction and rejecting his highest bids at a 2004 auction, where Toussie and his wife were escorted out by police.
The two lawsuits were subsequently consolidated. After years of discovery disputes and failed settlement talks, the case went to trial in August 2011 on a trimmed number of claims. Toussie sought $35.8 million in damages.
The jury found for Toussie on his due process claims stemming from the 2004 auction but found for the county on the remaining claims and awarded Toussie $12,500.
Both the county and Toussie have filed a notice of appeal.
Seybert noted the $12,500 award was “a mere third of a percent” of what Toussie sought.
In their request for legal fees, Toussie’s attorneys submitted more than 400 pages of billing records. They maintained the case was “extremely complex in all respects,” and further complicated by the case’s “vast record.” They argued Toussie had won more than nominal damages and his constitutional rights had been vindicated.
But Suffolk County claimed Toussie’s attorneys were not entitled to fees because the jury award was “de minimus” and the request was “so unreasonable and grossly excessive.”
At the most, the county said, Toussie’s attorneys should get $25,000, representing twice the amount of the jury award.
Seybert said Toussie’s attorneys were entitled to seek compensation only for the claims where they prevailed—something they said they had done. But she said the requested fees included unrelated tasks.
For example, one entry involved time spent on the motion to consolidate the two actions. Other fees were sought for communicating with Toussie’s son, Isaac, but Seybert said that was linked to other claims.
“Such requests shock the conscience given that counsel affirmatively stated that these fees were being excluded from the fee request and, as these unreasonable fee requests so permeate counsel’s time sheets, they could not have been included by mistake,” Seybert wrote.
The judge observed the sought-after hourly rates ranged from $375 to $905, but those “greatly exceed” the rates now being awarded in the Eastern and Southern districts.
She also faulted the attorneys for not breaking out travel time and asking 100 percent compensation though Lindsay previously ordered that travel time was compensable at 50 percent.
Toussie’s attorneys said they did not include the fees from the 2001 action, nor did they ask for payment on additional claims from the 2005 suit.
Nevertheless, the claims “involved a common core of facts and were based on related legal theories. As such, it was not feasible for Plaintiff to surgically remove time records that relate to the Claims, but which also relate to other issues in this litigation. Those time records should be included in calculating the attorneys’ fees even where they do not specify the Claims,” the firms argued.
Seybert was not convinced.
She noted there were three distinct auctions at question. Most of the claims came under 42 U.S. Code §1983, she acknowledged, but she failed “to see the overlap between, for example, claims under the First Amendment or bill of attainder clause and the due process claims. Only a fraction of this time would be considered ‘reasonable,’ given that Toussie only succeeded on two claims.”
Noting the decision would be saving money for local taxpayers, a Suffolk County spokeswoman said, “We feel gratified and vindicated by the court’s decision.”
Assistant County Attorneys John Petrowski and Chris Termini appeared on the county’s motion opposing legal fees.
Scott Balber of Chadbourne appeared on Toussie’s motion for legal fees. He did not respond to a request for comment.
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