Court Opinion

ID: 2816304
Source: CourtListenerOpinion
Date Created: 2015-07-10 16:02:44.261041+00
Date Added: 2024-06-11T12:19:05.338636
License: Public Domain

United States Court of Appeals
         FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 13, 2015                Decided July 10, 2015

                         No. 13-7196

                        WILMA ELEY,
                         APPELLEE

                              v.

                   DISTRICT OF COLUMBIA,
                        APPELLANT

        Appeal from the United States District Court
                for the District of Columbia
                    (No. 1:11-cv-00309)

    Richard S. Love, Senior Assistant Attorney General,
Office of the Attorney General of the District of Columbia,
argued the cause for the appellant. Irvin B. Nathan, Attorney
General at the time the brief was filed, Todd S. Kim, Solicitor
General, and Loren L. AliKhan, Deputy Solicitor General,
were with him on brief.

     Douglas W. Tyrka argued the cause and filed the brief for
the appellee.

    Bruce J. Terris, Carolyn Smith Pravlik, and Kathleen L.
Millian were on brief for amici curiae The Class Members In
Salazar v. District of Columbia in support of the appellee.
                               2
    Before: HENDERSON and KAVANAUGH, Circuit Judges,
and RANDOLPH, Senior Circuit Judge.

    Opinion for the Court filed by Circuit Judge HENDERSON.

    Concurring opinion filed by Circuit Judge KAVANAUGH.

     KAREN LECRAFT HENDERSON, Circuit Judge: After
Wilma Eley prevailed in her lawsuit against the District of
Columbia (District) alleging a violation of the Individuals
with Disabilities Education Act (IDEA), 20 U.S.C. §§ 1400 et
seq., the district court awarded her $62,225 in attorneys’ fees
and costs for approximately one hundred hours of work.
Although the District lodged a variety of challenges to the
award in the district court, its sole objection on appeal is to
the prevailing market rate that court used in its calculation.
Specifically, the District argues that the district court abused
its discretion when it adopted Eley’s proposed fee matrix,
setting the prevailing market rate for her lawyer’s services
well beyond the next highest hourly rate used by district
courts in IDEA litigation. For the reasons set forth below, we
vacate the district court’s fee award and remand.

                     I. BACKGROUND

     The IDEA requires the District to provide disabled
children with a “free appropriate public education.” 20
U.S.C. § 1400(d)(1)(A); see also id. § 1412(a)(1) (free
appropriate public education “available to all children with
disabilities . . . between the ages of 3 and 21, inclusive”). If
the District fails to do so, the child’s parents can file an
administrative complaint with the District Office of the State
Superintendent of Education (Superintendent’s Office). Id.
                                 3
§ 1415(b)(6). 1 And if the administrative-complaint route
fails, the parents can sue the District in district court. See id.
§ 1415(i)(2)–(3).

     If the parents’ lawsuit succeeds, the court, “in its
discretion, may award reasonable attorneys’ fees.” Id.
§ 1415(i)(3)(B)(i)(I). An IDEA fee award “shall be based on
rates prevailing in the community in which the action or
proceeding arose for the kind and quality of services
furnished.” Id. § 1415(i)(3)(C) (emphases added). Thus, if
the court finds that “the amount of the attorneys’ fees
otherwise authorized to be awarded unreasonably exceeds the
hourly rate prevailing in the community for similar services
by attorneys of reasonably comparable skill, reputation, and
experience,” it “shall reduce . . . the amount of the attorneys’
fees awarded.” Id. § 1415(i)(3)(F)(ii) (emphasis added).

     The IDEA provides no further guidance for determining
an appropriate fee award. In Blum v. Stenson, 465 U.S. 886,
895 n.11 (1984), however, the United States Supreme Court
laid the foundation for the three-part analysis that this Court
has since developed. First, the court must determine the
“number of hours reasonably expended in litigation.” Save
Our Cumberland Mountains, Inc. v. Hodel (SOCM), 857 F.2d
1516, 1517 (D.C. Cir. 1988) (en banc). 2 Second, it must set
    1
        See also D.C. Code § 38-2601.01 (Superintendent’s Office
“perform[s] the functions of a state education agency for the
District of Columbia under applicable federal law”).
    2
         We apply the respective analyses from Blum and SOCM
notwithstanding both cases involved different attorneys’ fees
statutes. See Indep. Fed’n of Flight Attendants v. Zipes, 491 U.S.
754, 759 n.2 (1989) (“[F]ee-shifting statutes’ similar language is a
strong indication that they are to be interpreted alike.” (quotation
marks omitted)).
                              4
the “reasonable hourly rate.” Id. Finally, it must determine
whether use of a multiplier is warranted. Id. The “fee
applicant bears the burden of establishing entitlement to an
award, documenting the appropriate hours, and justifying the
reasonableness of the rates” and the opposing party remains
“free to rebut a fee claim.” Covington v. Dist. of Columbia,
57 F.3d 1101, 1107–08 (D.C. Cir. 1995).

     Here, the District no longer challenges the hours Eley’s
lawyer spent litigating her IDEA case, and the IDEA prohibits
application of any “bonus or multiplier,” 20 U.S.C.
§ 1415(i)(3)(C). Accordingly, we move to the second prong
of the SOCM analysis—the reasonable hourly rate. Whether
an hourly rate is reasonable turns on three sub-elements:
(1) “the attorney[’s] billing practices,” (2) “the attorney[’s]
skill, experience, and reputation” and (3) “the prevailing
market rates in the relevant community.” Covington, 57 F.3d
at 1107. Of these three sub-elements, the District contests
only the prevailing market rate in the relevant community.

     Determining the prevailing market rate is “inherently
difficult.” Blum, 465 U.S. at 895 n.11. Even so, “[t]he
complexity of the market for legal services does not . . .
reduce the importance of fixing the prevailing hourly rate in
each particular case with a fair degree of accuracy.” Nat’l
Ass’n of Concerned Veterans v. Sec’y of Def., 675 F.2d 1319,
1325 (D.C. Cir. 1982). Thus, a fee applicant must “produce
satisfactory evidence—in addition to the attorney’s own
affidavits—that the requested rates are in line with those
prevailing in the community for similar services by lawyers of
reasonably comparable skill, experience and reputation.”
Blum, 465 U.S. at 895 n.11 (emphasis added); see also Nat’l
Ass’n of Concerned Veterans, 675 F.2d at 1325 (“An
applicant is required to provide specific evidence of the
                               5
prevailing community rate for the type of work for which he
seeks an award.” (emphasis added)).

     We allow a fee applicant to submit attorneys’ fee
matrices as one type of evidence that “provide[s] a useful
starting point” in calculating the prevailing market rate.
Covington, 57 F.3d at 1109. The most commonly used fee
matrix is the “Laffey Matrix”—the schedule of prevailing
rates compiled in Laffey v. Northwest Airlines, Inc. (Laffey I),
572 F. Supp. 354, 371 (D.D.C. 1983), aff’d in part, rev’d in
part on other grounds, Laffey v. Nw. Airlines, Inc. (Laffey II),
746 F.2d 4 (D.C. Cir. 1984), overruled in part on other
grounds, SOCM, 857 F.2d 1516. See Covington, 57 F.3d at
1109. Laffey I established (and Laffey II affirmed) the
following schedule for lawyers who practice “complex federal
litigation”:

       —$175 an hour for very experienced federal
       court litigators, i.e., lawyers in their 20th year
       or more after graduation from law school;

       —$150 an hour for experienced federal court
       litigators in their 11th through 19th years after
       law school graduation;

       —$125 an hour for experienced federal court
       litigators in their 8th through 10th years after
       graduation from law school;

       —$100 an hour for senior associates, i.e., 4 to
       7 years after graduation from law school; and

       —$75 an hour for junior associates, i.e., 1 to 3
       years after law school graduation.

Laffey I, 572 F. Supp. at 371–72; Laffey II, 746 F.2d at 8 n.14.
                               6
     Fee matrices in general are “somewhat crude” and the
Laffey Matrix in particular “lumps attorneys with four to
seven years of experience in the same category” as well as
“attorneys with eleven to nineteen [years].” Covington, 57
F.3d at 1109. For this reason, a fee applicant supplements fee
matrices with other evidence such as “surveys to update
the[m]; affidavits reciting the precise fees that attorneys with
similar qualifications have received from fee-paying clients in
comparable cases; and evidence of recent fees awarded by the
courts or through settlement to attorneys with comparable
qualifications handling similar cases.” Id. Additionally,
because the original Laffey Matrix is now more than thirty
years old, it must be updated to account for inflation. See
SOCM, 857 F.2d at 1525. Competing updated Laffey
Matrices have developed, two of which are at issue here.
Both have their benefits and limitations.

     The first Laffey Matrix is maintained and updated by the
District United States Attorney’s Office (USAO Laffey
Matrix). See USAO Laffey Matrix – 2014-2015, available at
http://www.justice.gov/sites/default/files/usao-dc/legacy/2014
/07/14/Laffey%20Matrix_2014-2015.pdf. The USAO Laffey
Matrix starts with “[t]he hourly rates approved in Laffey . . .
for work done principally in 1981–82” as its baseline. Id. ¶ 3.
It adjusts these rates to account for inflation by using the
Consumer Price Index for All Urban Consumers (CPI-U) of
the United States Bureau of Labor Statistics. Id. The CPI-U
measures inflation across “100,000 commodities including
food, fuel, and housing” for a given geographic area—here,
the Washington, D.C area. Amicus Br. 4. Yet, “[l]ess than
0.325 percent of the data” in the CPI-U “involves legal
services.” Id. And according to the district court, the CPI-U
“shows that the cost of legal services nationally has far
outstripped the increase in overall prices.” Eley v. Dist. of
Columbia (Eley II), 999 F. Supp. 2d 137, 153 (D.D.C. 2013);
                                  7
see also id. (“The nationwide cost of legal services has
jumped ninety-one percent, nearly twice as much as the
general CPI”). During Eley’s IDEA litigation, the USAO
Laffey Matrix suggests that a litigator specializing in complex
federal litigation with 11 to 19 years’ experience should
receive between $420 and $445 per hour.

     Because the USAO Laffey Matrix relies on inflation in
general rather than legal-services inflation specifically, its
critics have advocated, to some degree of success, 3 for a
competing Laffey Matrix (LSI Laffey Matrix) that uses the
Legal Services Index of the Bureau of Labor Statistics to
adjust for inflation. Developed by Michael Kavanaugh, an
economist from Hawaii, the LSI Laffey Matrix adjusts for the
increases in costs for legal services only. It suffers, however,
from its own imprecisions. Rather than tracking inflation
levels specific to Washington, D.C., the LSI Laffey Matrix
tracks the national rate of change in the cost of legal services.
During Eley’s IDEA litigation, the LSI Laffey Matrix suggests
that a litigator specializing in complex federal litigation with
11 to 19 years’ experience should receive $625 per hour. 4

     3
        See, e.g., Salazar v. Dist. of Columbia, 123 F. Supp. 2d. 8,
15 (D.D.C. 2000) (LSI Laffey Matrix “more accurately reflects the
prevailing rates for legal services in the D.C. community”).
     4
         There are other differences between the USAO Laffey
Matrix and the LSI Laffey Matrix. See generally Amicus Br. 8–14
(comparing two matrices in greater depth). For example, the LSI
Laffey Matrix uses as its starting point the rates established in 1989
after our en banc decision in SOCM rather than the “hourly rates
approved in Laffey” that “were for work done principally in 1981–
82.” See Laffey Matrix – 2014–2015, supra, ¶ 3; see also SOCM,
857 F.2d at 1525 (discussing Laffey Matrix and suggesting parties
develop “a similar schedule of prevailing community rates for other
relevant years”).
                              8
    On September 13, 2010, Eley filed an administrative
complaint with the Superintendent’s Office, alleging that the
District violated the IDEA by failing to place her special-
needs child in an appropriate public school. A hearing officer
denied her claim but Eley successfully challenged the denial
in district court. See Eley v. Dist. of Columbia (Eley I),
No. 1:11-cv-309, 2012 WL 3656471, at *1 (D.D.C. Aug. 24,
2012).      After concluding that Eley was entitled to
reimbursement for the money she spent on her child’s
education, the district court remanded her case to the
Superintendent’s Office, which awarded her $2,850.

     Eley then filed a motion for attorneys’ fees and costs,
seeking $62,225 for 97.5 hours of work (approximately one-
third of which occurred at the administrative stage) and 3
hours of travel, as well as $350 for filing fees. To arrive at
this figure, Eley used the prevailing market rate set forth in
the LSI Laffey Matrix, which reflected that her lawyer should
receive $625 per hour. To support her use of the LSI Laffey
Matrix, Eley submitted a verified statement from her lawyer,
averring that:

   •    his firm has “always” charged the hourly rates
        in the LSI Laffey Matrix;

   •    “[t]he current hourly rate for [his] time is
        $625.00 per hour”;

   •    his firm had settled cases in which the District
        “paid the firm 99.9% of what was billed” after
        applying a statutory fee cap;

   •    “[t]he expenses in [his] itemization are the
        charges customarily paid in this field in this
        jurisdiction”;
                              9
   •    “at least 95% of [his] practice has been in the
        field of special education law”; and in his
        “conservative and educat[ed] estimate,” he
        has “litigated over 1000 IDEA administrative
        cases and over 20 IDEA federal cases.”

Verified Statement of Douglas Tyrka ¶¶ 7–9, 15. Eley also
submitted her lawyer’s verified time sheets and a declaration
of Michael Kavanaugh (prepared for a different case),
explaining the methodology Kavanaugh used to generate the
LSI Laffey Matrix. The District contested Eley’s attorneys’
fees request, arguing that the district court should award
$749.25 only. In so doing, it cited over forty cases in which
district courts had awarded attorneys’ fees awards in IDEA
cases based on prevailing market rates set at (or below) the
USAO Laffey Matrix, not one of which exceeded $425 per
hour. In contrast, Eley cited only four cases in which district
courts had used the LSI Laffey Matrix, none of which
involved IDEA litigation.

     The district court referred Eley’s motion to a magistrate
judge, who declined to use the $625 figure from the LSI
Laffey Matrix. He reasoned that Eley failed to submit
evidence demonstrating entitlement to an “elevated hourly
rate.” R & R 8–9. Starting instead with the rates in the
USAO Laffey Matrix (between $420 and $445 per hour), the
magistrate reduced those rates by twenty-five per cent
(between $315 to $333.75) in accordance with other IDEA
cases. See R & R 9–10 (discussing Rooths v. Dist. of
Columbia, 802 F. Supp. 2d 56, 62–63 (D.D.C. 2011);
McClam v. Dist. of Columbia, 808 F. Supp. 2d 184, 190
(D.D.C. 2011)). Because the Laffey Matrix was created for
“complex federal litigation in the District of Columbia” and it
contains presumptive maximum rates, id. at 9 (emphasis
added), the magistrate found the maximum Laffey rates “not
                               10
appropriate” for Eley’s IDEA litigation, id. at 10. Multiplying
the number of hours by his chosen hourly rate, the magistrate
recommended that Eley receive $40,620.32 in fees and costs.

     Both sides objected to the magistrate’s report and
recommendation. Eley challenged the magistrate’s choice of
prevailing market rate, and the District attacked on multiple
fronts, urging the district court to reduce the award from
$40,620.32 to no more than $2,900.62. The district court
largely ruled in favor of Eley. The court first compared the
USAO and LSI Laffey Matrices, ultimately deciding to use
the LSI Laffey Matrix. Despite the “major criticism” that the
LSI Laffey Matrix is “only indicative of ‘the prevailing
market rates for attorneys engaged in complex federal
litigation in the “big firm” context,’ ” Eley II, 999 F. Supp. 2d
at 154 (quoting Heller v. Dist. of Columbia, 832 F. Supp. 2d
32, 45 (D.D.C. 2011) (alterations omitted)), the court
observed that Blum and SOCM held, respectively, that
nonprofit lawyers and lawyers who charge reduced rates for
certain types of litigation are entitled to receive the same
prevailing market rate as private counsel who prevail in
“equally complex Federal litigation.” Id. at 155 (citing Blum,
465 U.S. at 895; SOCM, 857 F.2d at 1524). At bottom, the
court concluded that Eley’s lawyer’s verified statement, “as
well as [Kavanaugh’s] declaration explaining the
methodology and rationale for the updated rates,”
demonstrated that the LSI Laffey Matrix was “an appropriate
measure of the prevailing community rates for attorneys in the
Washington, D.C. area.” Id. at 156.

    Next, the district court rejected the District’s argument
that “IDEA cases do not represent sufficiently complex
federal litigation to warrant the presumptive use of the USAO
matrix as the prevailing market rate, let alone the LSI-
adjusted rates requested by [Eley].” Id. at 157. It did so after
                               11
concluding that “some version of the Laffey matrix is
presumptively reasonable in civil rights litigation,” that “a
complexity determination is not the dispositive question as to
whether such rates apply” and that, in any event, nothing in
D.C. Circuit precedent “indicates that IDEA cases, as a subset
of civil rights litigation, fail to qualify as ‘complex’ federal
litigation.” Id. at 159. In ordering the District to pay the full
$62,225 requested by Eley, the court noted that the
“complexity of [a] case is accounted for by the number of
hours expended” and “should not be accounted for by a blunt
reduction of rates before applying the rates to the number of
hours expended.” Id. at 160. The District timely appealed.

                       II. ANALYSIS

     We review the district court’s fee award for abuse of
discretion, King v. Palmer, 950 F.2d 771, 785 (D.C. Cir.
1991) (en banc), and will not upset its hourly rate
determination “absent clear misapplication of legal principles,
arbitrary fact finding, or unprincipled disregard for the record
evidence.” Kattan ex rel. Thomas v. Dist. of Columbia, 995
F.2d 274, 278 (D.C. Cir. 1993), as amended (June 30, 1993).
“This limited standard of review is appropriate in view of the
district court’s superior understanding of the litigation and the
desirability of avoiding frequent appellate review of what
essentially are factual matters.” Covington, 57 F.3d at 1110
(quotation marks omitted). At the same time, we “examine de
novo whether the district court applied the correct legal
standard.” Conservation Force v. Salazar, 699 F.3d 538, 542
(D.C. Cir. 2012).

     As noted, Eley had the burden “to produce satisfactory
evidence—in addition to [her] attorney’s own affidavits—that
[her] requested rates are in line with those prevailing in the
community for similar services by lawyers of reasonably
                               12
comparable skill, experience, and reputation.” Covington, 57
F.3d at 1109 (quoting Blum, 465 U.S. at 895 n. 11). In
Covington, this Court held that the “plaintiffs clearly met their
burden and their requested rates were properly accorded a
presumption of reasonableness.” Id. at 1110. We so held
because the plaintiffs submitted not only “data demonstrating
their attorneys’ experience in the legal profession and in
litigating complex federal court cases, as well as information
probative of their attorneys’ skill and reputation,” they also
submitted “a great deal of evidence regarding prevailing
market rates for complex federal litigation,” including “the
Laffey matrix, the U.S. Attorney’s Office matrix, affidavits
attesting to increases in the market rates since the original
Laffey matrix” and, importantly, “memorandum opinions in
district court cases which relied on these matrices.” Id. In
rebuttal, the District failed to cite any relevant cases
supporting its requested rates. Id. at 1111. For this reason,
this Court rejected the District’s argument that “a civil rights
and employment discrimination market actually exists
independent of attorneys who handle other types of complex
federal litigation” and that this market charges rates “lower
than the prevailing rates in the broader legal market.” Id.

     Here, however, the reverse is true. Eley’s evidentiary
submission consisted of the LSI Laffey Matrix, Kavanaugh’s
declaration explaining the LSI Laffey Matrix and her lawyer’s
verified statement averring that he charged his paying clients
the rates in the LSI Laffey Matrix. Absent from her
submission, however, is evidence that her “requested rates are
in line with those prevailing in the community for similar
services,” i.e., IDEA litigation. Id. at 1109 (emphasis added);
see also 20 U.S.C. § 1415(i)(3)(C) (IDEA fee awards “shall
be based on rates prevailing in the community . . . for the kind
and quality of services furnished”). Indeed, Eley directed the
district court to only four cases that had employed the LSI
                                  13
Laffey Matrix—none of which was an IDEA case. The
District, on the other hand, cited more than forty IDEA cases
in which IDEA plaintiffs had received attorneys’ fees awards
based on prevailing hourly rates at least $180 lower than the
$625 rate applied by the district court here. 5 On this record,
Eley has not met her burden of “justifying the reasonableness
of the rates.” Covington, 57 F.3d at 1107.

     We conclude that, in relieving Eley of her burden, the
district court abused its discretion. It relied on Blum and
SOCM but neither case establishes that the rates charged by
lawyers in the largest law firms automatically set the
prevailing market rate for IDEA litigation. Instead, Blum and
SOCM held only that legal aid lawyers (Blum), lawyers in
nonprofit law firms (Blum) and lawyers who charge either
reduced rates or on a pro bono basis (SOCM) should receive
fees based on the prevailing market rate charged by for-profit
lawyers if they are doing the same type of litigation. Implicit
in both cases is the assumption that the legal aid and non-
profit lawyers are engaged in litigation that is “equally
complex” to that of their for-profit counterparts. Blum, 465
U.S. at 893; see also SOCM, 857 F.2d at 1524. But absent is
any record evidence, other than the fee applicant’s
declaration, demonstrating that IDEA litigation is as complex

     5
       We do not mean to suggest that a fee applicant must always
cite fee orders issued in other cases; rather, evidence of the
prevailing market rate can take many forms. See, e.g., Covington,
57 F.3d at 1113 (Henderson, J., dissenting) (“A statistically reliable,
well-documented, and extensive survey of the rates clients pay for a
certain sub-market of legal services would be powerfully
persuasive.” (emphasis omitted)). Here, the prevailing market
evidence proffered by both sides (save for the competing Laffey
Matrices and Eley’s lawyer’s billing information) consists solely of
awards made by other district courts.
                                  14
as the type of litigation that supports the “enhanced” hourly
rates in the LSI Laffey Matrix.

     Nor is it an answer to rely on the fact that our precedent
does not “indicate[] that IDEA cases, as a subset of civil
rights litigation, fail to qualify as ‘complex’ federal
litigation.” Eley II, 999 F. Supp. 2d at 159. Indeed, this
reasoning flips the burden of persuasion on its head. By
concluding that “some version of the Laffey matrix is
presumptively reasonable,” settling on the LSI Laffey Matrix
and applying it because no evidence was produced disproving
that IDEA litigation is sufficiently “complex,” id., the district
court erred in not requiring Eley to demonstrate that her
suggested rate was “in line with those prevailing in the
community for similar services.” Covington, 57 F.3d at 1109
(quoting Blum, 465 U.S. at 895 n.11). We do not decide
today whether IDEA litigation is in fact sufficiently
“complex” to use either version of the Laffey Matrix (and if
so, which version of the Laffey Matrix is more appropriate). 6
But the obligation was Eley’s to demonstrate that her
     6
         See Price v. Dist. of Columbia, No. 14-7133, 2015 WL
3916444, at *4 (D.C. Cir. June 26, 2015) (Brown, J., concurring)
(“[T]he Laffey Matrix rate . . . is . . . an irrelevant benchmark for
administrative proceedings before a D.C. Public Schools . . .
hearing officer.”); see also id. (fee applicants “are entitled to the
Laffey rate only if they can establish that the relevant legal market
in this action, namely representation in IDEA administrative due
process hearings, is subject to the same hourly rates that prevail in
complex federal litigation. Absent such a finding, Laffey Matrix
rates are irrelevant to the prevailing-rate determination.” (citations,
quotation marks and alteration omitted)). See generally id. at *5
(“[W]hen courts are too generous in awarding fees, they create an
incentive for needless conflict and enrich IDEA lawyers at the
expense of public schools, and ultimately the very children the
IDEA seeks to protect.”).
                             15
suggested rates were appropriate. Because she was not
required to do so, the district court, we conclude, “clear[ly]
misappli[ed] . . . legal principles” and thus abused its
discretion. Kattan, 995 F.2d at 278.

    For the foregoing reasons, we vacate the district court’s
fee award and remand for proceedings consistent with this
opinion.

                                                  So ordered.
     KAVANAUGH, Circuit Judge, concurring: I join the
Court’s opinion. I would simply add that, in my view, the
United States Attorney’s Office Laffey matrix is appropriate
for IDEA cases.