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Nature of Suit Code: 442
Nature of Suit: Civil Rights Employment
Cause of Action: 

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 11, 2007 Decided November 2, 2007

No. 06-5173

PATRICIA L. SIMS,

APPELLANT

v.

STEPHEN L. JOHNSON, ADMINISTRATOR, UNITED STATES

ENVIRONMENTAL PROTECTION AGENCY,

APPELLEE

Appeal from the United States District Court

for the District of Columbia

(No. 97cv00570)

Bruce J. Terris argued the cause for appellant. With him on

the briefs was Sameena S. Majeed.

Peter S. Smith, Assistant U.S. Attorney, argued the cause

for appellee. With him on the brief were Jeffrey A. Taylor, U.S.

Attorney, and R. Craig Lawrence, Assistant U.S. Attorney.

Before: ROGERS, GARLAND and KAVANAUGH, Circuit

Judges.

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Opinion for the Court filed by Circuit Judge ROGERS.

Dissenting opinion filed by Circuit Judge KAVANAUGH.

ROGERS, Circuit Judge: Patricia L. Sims appeals the denial

of her motion for a declaratory judgment concerning the

payment of attorneys’ fees. In 1999, the parties entered into a

settlement of Sims’ discrimination claims that left for future

resolution the amount and terms of the government’s payment

of attorneys’ fees and costs. In 2003, a Magistrate Judge found

that Sims’ former attorney and the government had reached a

compromise settlement regarding attorneys’ fees. The record,

however, does not reveal the terms of the compromise

settlement, which are disputed and underlie Sims’ request for

declaratory relief. We therefore must vacate the order denying

Sims’ motion and remand the case to the district court. 

I.

In 1997, Sims sued the Environmental Protection Agency

pursuant to Title VII of the Civil Rights Act of 1964, 42 U.S.C.

§ 2000e et seq., as amended, and the Rehabilitation Act of 1973,

29 U.S.C. § 791 et seq., as amended. By letter agreement of

March 25, 1999, the parties resolved Sims’ substantive claims

and required the government to pay her reasonable attorneys’

fees and costs. The amount and terms of that payment were left

for future negotiations. On June 9, 2000, the district court

enforced the letter agreement at Sims’ request, finding that the

parties had reached an agreement in principle on the material

terms of a settlement and dismissing the case without prejudice.

When Sims subsequently moved to reopen the case, the district

court, on October 4, 2000, restored the case to the active docket

to address the remaining issues, including attorneys’ fees. 

On March 28, 2001, David H. Shapiro, as Sims’ former

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attorney, filed a motion for an award of reasonable attorneys’

fees of $150,269.21, not including Sims’ out-of-pocket expenses

or fees of her initial, deceased counsel (Gary Simpson). Shapiro

also filed a motion to withdraw from the case, citing a

breakdown in his relationship with Sims as she refused to let

him settle the fees issue with the government. The government,

in turn, stated that it was “impossible to respond” because the

motion appeared to have been filed by counsel alone, without

Sims’ support or consent, noting that “[t]he law is clear . . . that

an attorney fee award under Title VII is due and payable to the

plaintiff, not to the plaintiff’s counsel,” Resp. at 2, and that “it

cannot reach such an agreement without the consent of

Plaintiff,” id. at 4. On May 23, 2001, the district court referred

these and other related motions to a Magistrate Judge “for

settlement and resolution of the currently pending motions.” 

Before the Magistrate Judge, Richard L. Swick (Shapiro’s

law partner) and Bruce L. Terris, representing Sims, stated that

“a comprehensive motion” on attorneys’ fees and costs would be

filed. Tr. Mar. 27, 2002 at 3. Terris stated that there was no

objection to Shapiro’s motion to withdraw, while noting

outstanding issues regarding how the substantive provisions of

the letter agreement were being carried out. Id. at 2-3. The

Magistrate Judge observed that the latter were for the district

court judge to resolve and directed Sims to file an amended

motion for attorneys’ fees, which she did on April 24, 2002.

That motion requested the payment of three amounts: $2,018.00

“directly payable to Ms. Sims for out of pocket expenses she

incurred directly”; $150,269.12 for attorneys’ fees and costs

incurred by Swick & Shapiro; and $9,613.75 for attorneys’ fees

and costs incurred for services by Sims’ initial attorney

(Simpson). 

By memorandum order of February 28, 2003, the

Magistrate Judge granted the motion for a settlement conference

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and Shapiro’s motion to withdraw and “denied as moot” Sims’

amended motion for attorneys’ fees. The memorandum order

recited that there had been a “telephonic status conference” on

February 24, 2002 during which “counsel for Defendant and

David Shapiro’s law partner [Richard L. Swick] represented that

they had agreed on a compromise settlement on the attorneys’

fees issue.” Mem. Order Feb. 28, 2003 at 2. “Counsel for

Plaintiff and . . . Defendant also represented that the issue of

reimbursement of Plaintiff’s costs is not disputed by either

party.” Id. 

Over two years later, by letter of May 20, 2005 to

government counsel, former counsel Swick enclosed a signed

release for fees due in Sims’ case and confirmed that the

payment of $120,000 for attorneys’ fees and costs due to Swick

& Shapiro (and including any fees and costs due to Sims’ initial

attorney’s estate) should be paid directly to the law firm’s trust

account. The release stated: “This Release constitutes the

complete and full agreement between the parties as to costs and

fees accrued prior to and including February 28, 2003 and

associated with this lawsuit.” On September 22, 2005, Swick

informed Sims that the government had paid the law firm and he

enclosed a check to reimburse Sims for her expenses. On

September 27, 2005, the government sent Sims a check for

$8,600, pursuant to the 1999 letter agreement, in settlement of

her discrimination claims.

On December 7, 2005, Sims filed a motion for a declaratory

judgment alleging that the government’s payment to her former

attorney’s law firm was contrary to her instructions, not made

pursuant to a court order or any agreement by her, and

“therefore does not constitute the payment for the attorneys’ fees

and expenses of plaintiff in this case.” Mot. for Decl. J. at 1.

The accompanying memorandum stated that “[t]he payment was

made even though plaintiff’s present counsel, Bruce J. Terris,

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repeatedly informed both Swick & Shapiro and defendant’s

counsel, that plaintiff opposed any payment of attorneys’ fees

unless and until plaintiff was protected from the payment of

income tax on money which would not come to her.” Mem. at

1. Attached was Terris’ affidavit setting forth his contacts with

Swick and government counsel. The district court denied the

motion, ruling that the government’s payment was made

pursuant to its obligations under the parties’ 1999 letter

agreement, which had been enforced at Sims’ request, and the

Magistrate Judge’s 2003 memorandum order. Sims appeals.

II.

As a threshold matter, the government contends that the

court lacks jurisdiction over the current dispute because Sims’

appeal is untimely and, alternatively, that even if the current

dispute is subject to judicial review, exclusive jurisdiction lies

in the United States Court of Claims. Sims appropriately

responds that her appeal is timely because it was filed within

sixty days of the denial of her motion, see FED. R. APP. P.

4(a)(1)(B). Sims’ underlying case has never been formally

dismissed either by the district court pursuant to Federal Rule of

Civil Procedure 58(a), see Bailey v. Potter, 478 F.3d 409, 411

(D.C. Cir. 2007) (citing Bankers Trust Co. v. Mallis, 435 U.S.

381, 384-85 (1978)), or by stipulation of the parties pursuant to

Federal Rule of Civil Procedure 41(a). Further, because Sims’

motion does not assert a breach of contract claim, the Court of

Claims does not have exclusive jurisdiction and the

government’s reliance on Hansson v. Norton, 411 F.3d 231

(D.C. Cir. 2005), is misplaced. Finally, given the ambiguity in

the record, to which we now turn, it is premature to characterize

Sims’ motion for declaratory relief, as the government suggests,

as a ploy to avoid the strictures of Federal Rule of Appellate

Procedure 4(a). See, e.g., Glinka v. Maytag Corp., 90 F.3d 72,

74 (2d Cir. 1996).

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In denying Sims’ motion for a declaratory judgment, the

district court concluded that Sims was trying to rewrite history

by suggesting that at the time of the government’s payment of

$120,000 the parties were still negotiating the contours of a

global settlement of the merits of her case. Observing that the

underlying merits had long been settled by the parties’ letter

agreement that had been enforced at Sims’ request, the district

court noted that the Magistrate Judge had “ruled that the parties

had reached an agreement – effectively closing the case.” Mem.

Op. Apr. 11, 2006 at 14. Inasmuch as the parties had not

reached any new settlement of the issues, the district court

viewed the government as “merely issu[ing] the payments

contemplated by, and pursuant to, the pre-existing agreements

in this case, as was ordered by both this [c]ourt and [the

Magistrate Judge].” Id. at 16. Because it deemed the case over,

the district court rejected Sims’ argument, based on Evans v. Jeff

D., 475 U.S. 717, 730-31 & n.20 (1986), that she had the right

to waive the right to seek attorneys’ fees. The district court

observed that if Sims wanted protection against potential tax

consequences of the payment of her attorneys’ fees, then she

“should have bargained for such provisions during the

settlement process or during the mediation before [the

Magistrate Judge].” Id. at 17. 

The district court’s interpretation and enforcement of its

orders is entitled to deference, for our review is limited to

determining whether there was an abuse of discretion. See Nix

v. Billington, 448 F.3d 411, 414 (D.C. Cir. 2006) (citing

Gardner v. United States, 211 F.3d 1305, 1308 (D.C. Cir.

2000)). The record supports the district court’s finding that the

merits of Sims’ discrimination claims had been settled by the

parties and enforced by the district court prior to the current

dispute. The district court also may be correct that the

compromise settlement referenced in the Magistrate Judge’s

2003 memorandum order resolved the outstanding attorneys’

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fees issues. However, on appeal, the parties present differing

interpretations of the terms of the 2003 compromise settlement.

Neither the district court in denying Sims’ motion for a

declaratory judgment nor the Magistrate Judge in issuing his

memorandum order recites the terms of the compromise

settlement, and the record before this court does not reveal them.

Whether the compromise settlement contemplated further

negotiations or represented a final resolution of the attorneys’

fees issues is dispositive of Sims’ request for declaratory relief.

If the attorneys’ fees issues were resolved in that compromise

settlement, Sims agreed to it at that time and she cannot obtain

declaratory relief on the basis of her present argument. If, on the

other hand, the fees issues were still under discussion when the

government paid the law firm $120,000 in 2005, then Swick was

not authorized to finalize the fees payment without Sims’

consent. Although Sims authorized her former attorney

(Shapiro) to submit an attorneys’ fees motion, she did not

thereby abdicate her role in the final resolution of the fees

issues; the law draws a distinction between the power to conduct

negotiations and the power to end a dispute. See Makins v.

District of Columbia, 861 A.2d 590, 595 (D.C. 2004);

RESTATEMENT (THIRD) OF THE LAW GOVERNING LAWYERS § 22

cmt. c (2000).

Neither the record nor the parties’ briefs shed much light on

the terms of the compromise settlement. For example, Sims

asserts that “[t]he reason that [her present attorney, Terris]

agreed [to the compromise settlement] was that Mr. Smith [the

government counsel], Mr. Shapiro [Sims’ former attorney], and

appellant [i.e., Sims through Terris] were in ongoing

negotiations over fees and other settlement issues.” Appellant’s

Reply Br. at 10. The government offers that the Magistrate

Judge’s memorandum order “resolved that issue” and that “the

amount was agreed upon between the parties and so represented

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to [the Magistrate Judge].” Appellee’s Br. at 22 (emphasis

added). The record’s silence between the 2003 compromise

settlement and the government’s 2005 payment of $120,000 to

Swick & Shapiro could support either party’s account: the delay

in payment is consistent with Sims’ view that terms remained

unresolved, while the lack of communication between the

parties for several years could indicate that negotiations had

ended on February 28, 2003, supporting the government’s view

that all attorneys’ fees issues were resolved and perhaps

suggesting that Sims’ attempt to undo the compromise

settlement arose only when she realized that tax protection was

a possibility under the American Jobs Creation Act, Pub. L. No.

108-357, 118 Stat. 1546 (2004). Government counsel’s

response to Terris, by letter of June 23, 2005, does not clarify

the matter, for it references only the 1999 letter agreement as the

source of the government’s obligation to pay the fees, implying

that the 2003 compromise settlement offered no additional

clarification on the terms of payment. 

Because the record does not resolve the parties’ dispute

whether the compromise settlement referenced in the Magistrate

Judge’s 2003 memorandum order finally resolved the terms of

the government’s payment of Sims’ attorneys’ fees, we must

vacate the order denying declaratory relief and remand the case

to the district court for an evidentiary hearing. See United States

v. Mahoney, 247 F.3d 279, 285 (D.C. Cir. 2001) (citing Autera

v. Robinson, 419 F.2d 1197, 1202-03 (D.C. Cir. 1969)). Given

the age of this case and the efforts by the district court and the

Magistrate Judge to resolve it, we do so reluctantly. However,

the issue Sims presents is not frivolous or trivial, see Autera,

419 F.2d at 1203, although the court has no occasion to express

an opinion on whether the parties would be able to reach a tax

indemnification agreement. 

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KAVANAUGH, Circuit Judge, dissenting: I respectfully 

dissent. I agree with District Court Judge Kollar-Kotelly’s 

thorough and persuasive opinion denying Sims’ motion for 

declaratory judgment. See Sims v. Johnson, No. 97-570, 2006 

WL 949917 (D.D.C. Apr. 11, 2006). 

Sims settled her discrimination suit with the Government 

in 1999, and she settled the attorney’s fees issue with the 

Government in 2003, as reflected in a contemporaneous order 

issued by Magistrate Judge Kay. Consistent with the 2003 

agreement, the Government then paid the attorney’s fees as 

required. Realizing after the fact that the fees agreement 

would have less-than-ideal tax consequences – in part because 

it would not allow her to take advantage of a 2004 change in 

the tax law – Sims is now trying to say, in effect, that there 

was never a fees agreement. The District Court correctly 

rejected Sims’ claim as a blatant attempt to rewrite history. 

The District Court added that if Sims wanted to “create certain 

protections vis-á-vis tax liability,” she should have “bargained 

for such provisions during the settlement process or during the 

mediation before Magistrate Judge Kay.” Id. at *10. 

Parties may not wriggle out of a contract simply because 

of subsequent tax law developments or because they failed to 

anticipate tax consequences when forming the agreement. 

Sims may have a problem with how her former or current 

attorneys advised her. But her settlement and fees agreements 

with the Government are binding, and her case against the 

Government is over. In my judgment, we do neither the 

parties nor our overburdened district courts any favors by 

further prolonging this decade-old case. 

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