Court Opinion

ID: 8907015
Source: CourtListenerOpinion
Date Created: 2022-11-27 01:56:48.693273+00
Date Added: 2024-06-11T17:08:17.081350
License: Public Domain

ROSENN, Circuit Judge,
concurring.
I join Chief Judge Seitz in his opinion and agree with him that the critical first step in fixing a reasonable attorney’s fee under the Civil Rights Attorney’s Fees Awards Act of 1976, Pub.L.94-559, § 2, Oct. 19, 1976, 90 Stat. 2641, codified at 42 U.S.C.A. § 1988 (West Supp.1977), is the determination of the “lodestar” (reasonable hours of service times reasonable hourly rate). I write only to emphasize that once that figure is ascertained, the district court may also in its discretion, adjust the final fee award to reflect the limited benefits produced by the litigation.
In Lindy Brothers Builders, Inc. of Philadelphia v. American Radiator & Standard Sanitary Corp., 487 F.2d 161 (3d Cir. 1973) (“Lindy I”), we set forth standards and guidelines governing the award of attorney’s fees in cases in which an attorney’s actions lead to the creation of an equitable fund. We later implemented and refined these formulations in Lindy II, 540 F.2d 102 (3d Cir. 1976) (en banc), concluding: (1) that a determination of the “lodestar” amount is the proper preliminary calculation in setting a fee, and (2) that the “lodestar” may be adjusted to account for two other factors — the contingent nature of success for the action and the quality of the attorney’s work. 540 F.2d at 112. We also specifically indicated that in making an adjustment for quality work the district court could consider the actual damages recovered by verdict or settlement. Id. at 118.1
*490Although the standards we enunciated in Lindy form the fundament for an award of attorney’s fees, it is important to state that the award flowing from' that formulation may, under certain circumstances, be subject to adjustment upward or downward. Lindy involved a recovery fund of approximately 25 million dollars and the attorneys’ fee claims — not the amount allowed— amounted to only a small fraction of the fund for distribution. In the instant case, however, we are not concerned with an equitable fund for distribution, but with a statutory award for services rendered in connection with civil rights litigation — a distinction of some importance, as the statutory right to receive an attorney’s fee has been legislated in numerous situations.2 In an equitable fund case, the outer limits of any claim for fees must perforce be the amount of the recovery. This limitation, however, is not necessarily present in a fee award made pursuant to a statutory provision.
The Civil Rights Attorneys’ Fees Awards Act, recognizing that fee awards are an essential remedy “if private citizens are to have a meaningful opportunity to vindicate important Congressional policies,” provides for an allowance by the court “in its discretion” of a “reasonable attorney’s fees.” If the plaintiff prevails, regardless of whether he prevails slightly or greatly, he is entitled to counsel fees. I believe that the district court in vindicating Congress’ policy to award a reasonable attorney’s fee has the flexibility to consider not only the extent to which the prevailing party’s action furthered the civil rights policy of the United States, but also whether the attorney’s time and expense in obtaining a favorable verdict were reasonable, in light of the actual amount recovered.
An analysis of the instant case illustrates the need for such flexibility for the district court in adjusting the “lodestar” when setting a fee award. This action affects the plaintiffs only in a very limited manner, a fact which the jury grasped and reflected in its award. By the time the case had been instituted, the plaintiffs had moved to another city and found living quarters elsewhere. Consequently, the jury returned a verdict against the defendant for only $1,250 compensatory damages and awarded no punitive damages. Plaintiffs claimed only that the defendants had discriminatorily refused to rent them an apartment, an isolated act of discrimination by a non-commercial property owner. The verdict in their favor does not correct across-the-board discrimination affecting a large class. It affects only the plaintiffs and, as I have indicated, in a very limited manner.
Following calculation of the lodestar, taking into account the reasonable hours attributable to the award in a law suit, I believe that the district court has further flexibility “in its discretion” to adjust the “lodestar” in view of the damages awarded and the defendants’ ability to pay. An attorney, depending solely upon a statutory discretionary fee award, who undertakes litigation in which the potential damages are small, may run the risk that his fee will not be full compensation for his labors. There may be cases in which the damages awarded are slight, but which nonetheless serve important governmental policies. In such cases, if the attorney’s hours are reasonable, the court may balance the small verdict with the important benefits produced by the litigation. However, for the ordinary case, once a district court has fixed the “lodestar” it should not be precluded from a downward adjustment of the fee, when, in its discretion, considering the potential damages available, the amount actually re*491covered, and the minor nature of the defendant’s misconduct, the court determines that the litigation has produced minimum benefits. See Lindy II, supra, 540 F.2d at 112, quoting, Merola v. Atlantic Richfield, Co., 515 F.2d 165, 168-69 (3d Cir. 1975) (“Merola II”) (the court may “reduce the objectively determined fee where the benefit produced does not warrant awarding the full value of the time expended”).

. In adjusting the “lodestar,” we stated that the district court may consider, inter alia:
1. The result obtained by verdict or settlement, evaluated in terms of (a) the potential money damages available to the class member, i. e., a comparison of the extent of possible recovery with the amount of actual verdict or settlement; (b) the benefit — monetary or non-monetary — conferred on the class, i. e., permitting the court “to recognize and *490reward achievements of a particularly resourceful attorney who secures a substantial benefit for his clients with a minimum of time invested . . .
Lindy Brothers, Inc. of Philadelphia v. American Radiator & Standard Sanitary Corp., 540 F.2d 102, 118 (3d Cir. 1976) (en banc) ("Lindy II”) (citation omitted).

. Presently at least seventy-five federal statutes, either “authorize or mandate courts to award attorneys’ fees as part of the relief granted.” Berger, Court Awarded Attorneys’ Fees: What Is Reasonable?, 126 U.Pa.L.Rev. 281, 282 (1977).