Source: https://www.calattorneysfees.com/cases-laffey-matrix/
Timestamp: 2019-04-25 16:33:13+00:00

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Reviewed in Our May 6, 2014 Post.
In our May 6, 2014 post, we reviewed Syers Properties v. Rankin, Case No. A137610 (1st Dist., Div. 2 May 5, 2014 issued unpublished), which held among other things that: (1) detailed categorical breakout of time spent can substantiate a fee petition in California state courts; (2) the reasonable market hourly rate, not billed rate, is the true lodestar index; and (3) a trial court can, but is not required to, follow the Laffey Matrix, regionally adjusted or otherwise. We can now report that this opinion was certified for publication on May 27, 2014.
Successful Defendants Substantiated Hours and Hourly Rate Very Well In This One.
Syers Properties III, Inc. v. Rankin, Case No. A137610 (1st Dist., Div. 2 May 5, 2014) (unpublished) is a case where a $843,245.27 defense fee award under Civil Code section 1717 was challenged on narrow grounds—with plaintiff disputing the reasonableness of hours claimed and the hourly rate being requested. Because these determinations are determined under a deferential abuse of discretion standard, plaintiff did not prevail on appeal.
So, what about the hourly rate being requested by prevailing defense counsel? The defense relied on counsel declarations about reasonableness of rate, bolstered by the Laffey Matrix rates adjusted to the San Francisco area by using locality pay tables. Plaintiff, however, argued that the rates were exorbitant because insurance defense firms charged much below the prevailing market rates so that they were stuck with these lower hourly rates. On review, the appellate court found that the real inquiry was looking to hourly rates compensating for the difficulty or complexity of the matter in the court venue at issue. The standard is not tied to the actual rate billed, but the reasonable market rate. (Nemecek & Cole v. Horn, 208 Cal.App.4th 641, 652 (2012).) Defense counsel did rely on a regionally-adjusted Laffey Matrix, which the appellate court dealt with this way: “. . . the trial court was neither required to follow the Laffey Matrix nor to adopt the rate defense counsel opined was the ‘market rate’ for the services of this type.” However, the lower court did credit the Laffey Matrix (adjusted or otherwise), so be it. However, in further reasoning, the reviewing court did indicate the lower court has considerable discretion to determine the proper market for work being charged, whether insurance defense litigation versus general civil litigation. Based on this “market” definition, the hourly rate could be limited based on the demarcation. “Again, we emphasize that such determinations lie within the broad discretion of the trial court.” (Slip Opn., p. 12.) Fee award affirmed—no abuse of discretion.
For a discussion of mediation confidentiality in the companion case, Syers Properties III, Inc. v. Rankin, Case No. A136018, see the May 6, 2014 blawg post on California Mediation and Arbitration.
U.S. Attorney’s Office Laffey Matrix Not Binding On State Courts In Determining Hourly Rates.
On April 9, 2014, we posted on DKN Holdings, LLC v. Faerler, a Fourth District, Division Two unpublished decision finding that the U.S. Attorney’s Office Laffey Matrix (developed for the D.C. area) was not binding on state courts when determining reasonable hourly rates for state court practitioners in fee contests. We can now report that this decision was published on April 25, 2014, keeping in mind that the 4/2 DCA is usually the most conservative intermediate appellate court when it comes to publication.
Number of Years of Experience But One Factor.
The winner of a commercial lease dispute with a fees clause was awarded $54,817.50 in fees, about 30% less than requested. On appeal, the loser argued that the trial court had to rely on the U.S. Attorney’s Office’s Laffey Matrix information in fixing fees. The appellate court in DKN Holdings LLC v. Faerber, Case No. E056294 (4th Dist., Div. 2 Apr. 9, 2014) (unpublished) disagreed, holding it not was not determinative and factors other than years of experience can be considered when calculating fee awards.
For those of you following our hourly rate analysis in the fee substantiation area, we have posted in the past on the use of the Laffey Matrix and related permutations in our December 31, 2010 post. We now have an update for you from the Third Circuit Court of Appeals (federal level).
In Interfaith Community Organization v. Honeywell International Inc., 2013 WL 3379319 (3d Cir. July 8, 2013), the Third Circuit affirmed a district judge’s decision to use the adjusted/updated Laffey Matrix pegged to the CPI rather than the unadulterated Laffey Matrix. In doing so, the federal appeals court bolstered its affirmance based on the district court reasoning in Salazar v. District of Columbia, 123 F. Supp.2d 8, 15 (D.D.C. 2011).
However, a caution is in order here by us bloggers. The use of these matrices is factually intensive, so that they only have value depending on the forum, venue, and circumstances involved—really, a critical analysis or “check” on other information, except maybe in the D.C. area (at best).
Given California’s More Liberal Approaches, These Alternatives Might Offer Guidance.
California endows trial judges with quite a bit of discretion when fixing the reasonableness of fees in a fee petition proceeding. Hourly rates can be pegged based on attorney declarations, surveys, matrices, and the like. Lodestar adjustments, upward or downward, are based on multiple factors, including a litigant’s degree of success.
In Grissom v. The Mills Corp., 549 F.3d 319, 323 (4th Cir. 2008), a fee petitioner attempted to prove the correctl hourly rate primarily through lead counsel’s declaration and the Laffey Matrix development of hourly rates for lawyers practicing in Washington, D.C. The Fourth Circuit, although finding the Matrix a “useful” starting point, found it did not necessarily reflect hourly rates for attorneys practicing in Reston, VA. Instead, it developed its own table of hourly rates based on what lead counsel and other attorneys had been awarded previously, adjusted by inflation in fees based on inflation rates obtained from Inflation.com. It also endorsed a fixed-percentage approach as far as reducing fees downward based on plaintiff’s degree of success (in situations where a litigant was successful and unsuccessful on mixed claims).
Although not binding, these cases may provide ways in which to offer proof in support of hourly rates or lodestar settings, depending on the circumstances.
Adjusted Laffey Matrix Methodology and U.S. District Judge Walker’s Approach.
In our December 28, 2010 post, we discussed the Laffey Matrix, which has gained acceptance by some judges in determining reasonable hourly rates for attorneys when it comes to presentation of proof in fees petitions. We now give you an introduction to alternative methodologies in the form of the the Adjusted Laffey Matrix and U.S. District Judge Vaughn Walker’s own adjustment approach using the Laffey Matrix.
Courts Declining to Use Adjusted Laffey Matrix. Particularly for the D.C. area, other courts have rejected use of the Adjusted Laffey Matrix, although there certainly is a split among the D.C. district judges because others do rely on it over the original Laffey Matrix preferred by other judges. (See, e.g., Woodland v. Viacom, Inc., 255 F.R.D. 278, 280 n. 1 (D.D.C. 2008) [District Magistrate Judge Facciola] (listing D.D.C. cases where variant approaches are taken with respect to use of the Adjusted Matrix]; see also Miller v. Holzmann, 575 F.Supp. 2, 17-18 (D.D.C. 2008) [District Judge Lamberth] (arguing that Dr. Kavanaugh’s use of a national CPI index is not geographically specific enough when it comes to calculating D.C. hourly rates).) Many of the courts disagreeing with use of the Adjusted Laffey Matrix seem to congregate in the D.C. area and have a problem with its use for purposes of calculating D.C. hourly rates.
District Judge Walker’s Approach. U.S. District Judge Vaughn Walker of the Northern District of California uses the original Laffey Matrix but then adjusts its D.C.-based rates for the specific locality of the lawyers seeking fees through use of local-oriented CPI indices. Most of his uses of this approach have occurred in securities class action contests. (See, e.g., In re HPL Technologies, Inc. Sec. Litig., 366 F. Supp.2d 912 (N.D. Cal. 2005); In re Chiron Corp. Sec. Litig., 2007 WL 4249902 (N.D. Cal. Nov. 30, 2007); In re Portal Software, Inc. Sec. Litig., 2007 WL 4171201 (N.D. Cal. 2007) [class actions]; accord, Martin v. FedEx Ground Package System, Inc., 2008 WL 5478576 (N.D. Cal. 2008); Garnes v. Harnhardt, 2006 WL 249522 (N.D. Cal. 2006).) For an article that criticizes using the Laffey Matrix in the class action context versus the actual billing rates of attorneys in the relevant community, see W.B. Rubenstein, Reasonable Rates: Time To Reload The (Laffey) Matrix, CLASS ACTION ATTORNEY FEE DIGEST 47-51 (Feb. 2008).
So, there you have the pros and cons of the Laffey Matrix, Adjusted Laffey Matrix, and U.S. District Judge Walker’s modified Laffey Matrix approach, with courts and experts split on which approach is superior depending on the circumstances and requested hourly fees in a given case.
So make up your mind . . .
Hourly Market Rate Analysis Frequently Involves Use Of the Laffey Matrix, Although Some Courts Do Not Like It.
When one is petitioning for fees or contesting a petition for fees, it is usually incumbent to utilize the lodestar approach by determining the prevailing hourly market attorney rates in the relevant community (most often, the county or district of the litigation venue in question). Various methods are used by fee proponents or contestants, such as a matrix, billing surveys (such as those reported by the National Survey Center, the National Journal, and Legal Times), attorney declarations, and evidence of recent court awards of fees to attorneys with comparable qualifications handling similar cases. (Salazar v. District of Columbia, 123 F. Supp.2d 8, 14 (D.D.C. 2000).) Some of the common matrices used to establish reasonable hourly attorney rates are the Laffey Matrix or the Adjusted Laffey Matrix (or hybrids of one or the other). We now provide a discussion about how courts treat use of these matrices, whether accepting them, criticizing them, rejecting them outright, or adjusting them further.
In our Part 2 post in this area, we will explore criticisms of the Laffey Matrix, judicial sentiment on the Adjusted Laffey Matrix, and U.S. District Judge Walker’s own twist on using the Laffey Matrix.
For our previous posts on the Laffey Matrix, see our June 10, 2010 post and our March 5, 2009 post on the subject.

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