For an entertaining meditation on the proper spelling 1

of “attorney’s fees,” see Stallworth v. Greater Cleveland Reg’l

Transit Auth., 105 F.3d 252, 253 n.1 (6th Cir. 1997) (“Should

we refer to ‘attorney fees,’ ‘attorneys fees,’ ‘attorney’s fees,’ or

‘attorneys’ fees?’ In federal statutes, rules and cases, we

find these forms used interchangeably, nay, promiscuously.

(continued...)

In the

United States Court of Appeals

For the Seventh Circuit

No. 11-2261

MORAD ELUSTA,

Plaintiff-Appellant,

v.

CITY OF CHICAGO, et al.,

Defendants-Appellees.

Appeal from the United States District Court 

for the Northern District of Illinois, Eastern Division.

No. 06 C 4264—Amy J. St. Eve, Judge.

ARGUED APRIL 11, 2012—DECIDED SEPTEMBER 4, 2012

Before WOOD, WILLIAMS, and TINDER, Circuit Judges.

WOOD, Circuit Judge. This is a case about attorney’s

fees. But it is not the typical attorney’s fees case in which 1
2 No. 11-2261

(...continued) 1

There is sometimes no consistency within even the same body

of law.”). In this decision, we will follow the text of 42 U.S.C.

§ 1988 and refer to the awards at issue as “attorney’s fees,”

even though of course we recognize that more than one

attorney stands to benefit from the fees in this case.

an attorney seeks review of a court’s award, perhaps

arguing about an improperly calculated lodestar. Instead here, a client—Morad Elusta—seeks to compel two

of his former attorneys, Zane Smith and Shelia Genson,

to turn over some of the fee award to him. Smith and

Genson represented Elusta in a civil rights suit against

the City of Chicago, in which he won a $40,000 judgment. Pursuant to 42 U.S.C. § 1988, the court then

awarded Elusta $82,696.50 for his attorney’s fees, which

the City has since paid to Smith and Genson.

In addition, the court entertained fee claims from

two more of Elusta’s former attorneys, David Cerda

and John De Leon, who represented Elusta in the same

matter before Smith and Genson took over. The district court determined that although Cerda and De Leon

could not assert an attorney’s lien on Elusta’s judgment, Elusta should still pay them $15,000 in quantum

meruit for their services. Elusta now insists that the City

of Chicago, not he, should pay the quantum meruit

award, and on top of that, he is entitled to retain 60% of

the amount awarded for the attorneys. Like the district

court, we find these arguments to be entirely without

merit. We thus affirm.
No. 11-2261 3

I

In the underlying case, Elusta sued the City of Chicago

and several of its police officers for excessive force,

false arrest, and intentional infliction of emotional distress that he suffered in conjunction with their search of

his home and his subsequent arrest. He first retained

Cerda and De Leon to bring these claims. Cerda and

De Leon conducted discovery and obtained a settlement offer of $100,000 from the City of Chicago. But

Elusta rejected this offer, apparently because he was

upset that his retainer agreement with Cerda and De Leon

contained a 40% contingent fee provision. Although

the parties attempted mediation to resolve the dispute

over the fee arrangement, the district court eventually

permitted Cerda and De Leon to withdraw from the case.

Elusta had difficulty finding new attorneys to represent him, but he ultimately retained Smith and Genson.

They took the case to trial before a jury, which found

in Elusta’s favor on two of the counts (excessive force

and intentional infliction of emotional distress) and

awarded him a total of $40,000. Smith and Genson

then petitioned the court for attorney’s fees on behalf

of Elusta pursuant to 42 U.S.C. § 1988. Before the court

could rule on the petition, Elusta retained a third set of

attorneys—Donald Johnson and Joseph Gentleman—to

litigate the fee issue. Johnson and Gentleman filed a

motion seeking to direct payment of some of the fees to

Elusta, rather than to Smith and Genson. The court dismissed that motion as premature, as it had not yet ruled

on the fee petition.
4 No. 11-2261

Smith and Genson’s petition languished for nearly

16 months without a ruling. At that point, Cerda and

De Leon filed their own motion for fees, asserting an

attorney’s lien on the judgment or in the alternative, a

right to recover the value of their work under quantum

meruit.

On December 13, 2010, the district court resolved the

various fee motions. It granted Smith and Genson’s

request that it award $82,696.50 in fees pursuant to § 1988.

Cerda and De Leon, it concluded, had not complied

with Illinois state law requirements to perfect an attorneys’ lien, but the court decided that they could recover $15,000 in quantum meruit. Elusta then refiled his

motion seeking to have 60% of both amounts paid

to him directly by the City of Chicago, with the

remainder going to the attorneys. The district court

denied Elusta’s motion, thereby concluding its work on

the fee issues, and Elusta now appeals.

II

We begin with Elusta’s assertion that he has a right

to a portion of the fees awarded to Smith and Genson.

It is well established that statutory attorney’s fees are

awarded to a prevailing party, but that the party is free

to waive or negotiate her right to the fees in her

contract with counsel. Venegas v. Mitchell, 495 U.S. 82, 87-90

(1990). We thus must look to Elusta’s retainer agreement with Smith and Genson to see if that agreement

supports Elusta. Interpretation of this contract raises

questions of law that we review de novo. Thomas v.
No. 11-2261 5

General Motors Acceptance Corp., 288 F.3d 305, 307 (7th

Cir. 2002).

The pertinent language in the agreement is the following: 

[T]he Client(s) acknowledges his/her understanding

of and consent to the fact that [Genson and Smith]

will divide the attorney’s fees recovered in the Client(s)’s claim. 

Elusta argues that the phrase “the attorney’s fees” does

not clearly cover all of the attorney’s fees. (This reminds

us of Humpty Dumpty’s comment about meaning in

Through the Looking-Glass, but we will let that pass.) Elusta

believes that other language in the agreement—namely,

the contingent provision—controls the amount of attorney’s fees that are available for Smith and Genson

to divide between themselves. He is referring to the

language providing that the client (Elusta) would

pay his attorneys “[a] sum equal to 40% of the gross

amount recovered from the claim by settlement or Judgment.” Elusta thinks that the attorney’s fee award is part

of the amount recovered “by settlement or Judgment.”

He then concludes that he is entitled to 60% of the fee

award and that Smith and Genson collectively receive

the remaining 40%, to divide as they wish.

The contract cannot bear Elusta’s interpretation. What

it does, in effect, is to say that counsel is entitled to

receive 40% of any damages (the contingent fee); if fees

are awarded to Elusta pursuant to § 1988, the attorneys receive all of that award. The language that the

attorneys “will divide the attorney’s fees recovered”

unambiguously covers all of the attorney’s fees recov-
6 No. 11-2261

ered. To come out Elusta’s way, the agreement would

have to be reworded to say something like “the attorneys

will divide their portion of the attorney’s fees recovered.”

The contingent fee provision plainly does not have anything to say about statutory fees. The contract awards

60% of a “settlement or Judgment” to Elusta, not “fees.”

Elusta argues that the contract’s use of the term “Judgment” must also encompass “fees,” but he cannot

support this idiosyncratic view. The contract distinguishes between judgments and fees in the two

clauses quoted above, and that distinction is almost

universal in the case law. See, e.g., Budinich v. Becton

Dickinson & Co., 486 U.S. 196, 200 (1988) (attorney’s fees

are “not generally treated as part of the merits judgment”). We thus agree with the district court that Elusta

is not entitled to any of the $82,696.50 fee award that

the City of Chicago paid to Smith and Genson.

III

Elusta’s argument with respect to the $15,000 awarded

to Cerda and De Leon in quantum meruit presents an

additional difficulty, because there is a threshold

question whether the district court had jurisdiction to

consider this claim in the first place. The district court

believed that it had supplemental jurisdiction over this

state-law matter because Cerda and De Leon’s claims

for fees were intimately related to the underlying litigation.

In our view, the court correctly concluded that it

could exercise jurisdiction over this part of the dispute.

Attorney’s fee disputes are closely enough related to
No. 11-2261 7

the underlying litigation to be the basis for supplemental jurisdiction, even if other attorney-client disputes,

such as malpractice actions, are not. See Abbott Laboratories

v. CVS Pharmacy, Inc., 290 F.3d 854, 858 (7th Cir. 2002)

(recognizing that “supplemental jurisdiction has been

capacious enough to include claims by or against third

parties” such as claims about attorney’s fees); Clarion

Corp. v. American Home Products Corp., 464 F.2d 444, 445

(7th Cir. 1972) (“There is no question . . . that a Federal

District Court may adjudicate the attorney’s fee question pursuant to the lien created by [a state] statute;

the theory being that if the original action has a proper

basis for Federal jurisdiction then any recovery achieved

by that suit creates an attachable interest upon which

the attorney may assert his claim for fees.”). In Matthews

v. Homecomings Fin. Network, Inc., 264 F. App’x 536,

537-38 (7th Cir. 2008), a nonprecedential disposition, we

noted that “because of a high degree of relatedness,

supplemental jurisdiction extends to suits over

attorney’s fees for work in underlying litigation that

is already within the court’s jurisdiction.” The court in

Matthews, as here, entertained the adjudication of a

state law attorney’s lien and an alternative argument

for recovery in quantum meruit. Id. at 539.

We thus turn to the merits of Elusta’s argument that

he should share in the quantum meruit award. It fails for

much the same reason that sank his claim to part of the

Smith and Genson award. Elusta points to a similar

contingent fee clause in his agreement with Cerda and

De Leon and argues that this means he should keep 60%

of the $15,000. We agree with the district court that this
8 No. 11-2261

argument “defies logic.” The purpose of quantum meruit

is to prevent unjust enrichment. In re Estate of Callahan,

578 N.E.2d 985, 988 (Ill. 1991). The court awarded $15,000

to Cerda and De Leon precisely because it concluded

that it would be unjust for Elusta to keep that money

after he had received the benefits of Cerda and De Leon’s

services. Elusta is thus, by definition, not entitled to

keep any of it. See Much Shelist Freed Denenberg & Ament,

P.C. v. Lison, 696 N.E.2d 1196, 1199 (Ill. App. Ct. 1998)

(“In quantum meruit recovery, the former client is liable

for the reasonable value of the services received during

the attorney’s employment.”).

The same principle also dooms Elusta’s argument that

the City of Chicago should be on the hook for the $15,000.

The entire purpose of the quantum meruit claim is to

disgorge wrongfully retained money from the party

who received the benefit of the work—that is, the “former

client,” Elusta. It is not a statutory attorney’s fee to be

paid by the City of Chicago.

IV

We finally address the motion brought by Smith and

Genson during this appeal for sanctions against Elusta’s

current attorneys, Johnson and Gentleman. Smith and

Genson argue that these attorneys should be sanctioned

because “the Order that they appeal from [the denial of

the motion to direct payment of fees] is not an appealable

Order.” In Smith and Genson’s view, “the final Order

was entered on October 16, 2008, rendering the June 3,

2011 Appeal untimely.”
No. 11-2261 9

It is hard to know what to make of this argument. It

is true that judgment in the underlying case was

entered in 2008, but the district court had not yet

received the attorneys’ petitions for fees. The district

court ruled on the fee motions on December 13, 2010.

Elusta then filed a motion to direct payment on December 23, 2010, which the district court denied on May 4,

2011. Elusta next timely filed a notice of appeal, on June 2,

2011. Smith and Genson read Budinich, 486 U.S. at

199-200, as supporting the argument that the June 2011

appeal was untimely because Elusta should have

appealed in 2008. But Budinich merely holds that a

plaintiff may appeal a judgment on the merits when the

merits are decided, even though later proceedings may

still take place to determine fees. Budinich has nothing

to say about this case: Elusta could obviously not

appeal the denial of a motion to direct payment of fees

before the fees had even been sought or awarded. Smith

and Genson’s argument otherwise is itself frivolous,

and we therefore decline their request for sanctions.

* * *

We AFFIRM the decision of the district court denying

Elusta’s motion to direct payment of the fee awards,

and DENY Smith and Genson’s motion for sanctions.

9-4-12