Opinion ID: 740486
Heading Depth: 3
Heading Rank: 3

Heading: The Circumstances of the Present Case

Text: 34 In the present case, plaintiffs submitted to the district court an affidavit from John L. Franco, Jr., the attorney who has represented them continuously in this action, which was commenced in 1993, stating that both the original firm of attorneys representing plaintiffs and Franco, who left the firm in February 1995, provided the legal services in this case under the arrangement that payments of all attorneys [sic ] fees and litigation costs would come from the § 1988 fees award. (Affidavit of John L. Franco, Jr., dated February 15, 1996, pp 1-2.) The District's $200,000 claim against plaintiffs plainly arose after the initial fee arrangements were entered into. Until the parties reached their global settlement, which followed the remand in Valley Disposal I, the state-court action was strictly between the District and Palisades Recycling, which is not a party here; the plaintiffs in the present action did not become parties to the state-court action until September 30, 1994, when the parties filed their stipulation in that court. It was that stipulation that gave the District its contractual claim against plaintiffs; the contract claim was then merged into the state-court judgment entered pursuant to the parties' stipulation. 35 Accordingly, if § 1988 creates a lien in favor of the prevailing party's attorneys, as held by the Eighth Circuit in Curtis, or if under Vermont law an attorney's charging lien has priority to a setoff claim that arose during the suit, or the equitable lien referred to in Button is created either when the fee contract is entered into or when the suit is commenced, it may well be that plaintiffs' attorneys in this lawsuit have a lien on the fee award, and that their lien has priority over the District's claim that was created by the settlement agreement and the state-court judgment during the course of this suit. 36 We need not resolve these potentially far-reaching questions in the present case, however, because we conclude for the reasons that follow that the District's claim of setoff was not properly raised. 37