Court Opinion

ID: 9470871
Source: CourtListenerOpinion
Date Created: 2023-08-05 03:18:40.073457+00
Date Added: 2024-06-11T17:42:09.068722
License: Public Domain

FRIENDLY,
Circuit Judge, concurring:
If we were writing on a clean slate, I would think the appropriate hourly rate to be used in fixing the compensation of a non-profit organization in a case like this would be a rate reflecting the hourly compensation paid to private attorneys in the same community with equivalent experience, see Rodriguez v. Taylor, 569 F.2d 1231, 1248 (3 Cir.1977), cert. denied, 436 U.S. 913, 98 S.Ct. 2254, 56 L.Ed.2d 414 (1978), plus the non-profit office’s per hour overhead. This would satisfy the indications in the Senate and House reports that the amount of fee awards in civil rights cases should be “governed by the same standards which prevail in other types of equally complex Federal litigation, such as antitrust cases”, Senate Report No. 1011, 94th Cong., 2d Sess. 6 (1976), reprinted in 1976 U.S. Code Cong. & Ad.News 5908, see also House Report No. 1558, 94th Cong., 2d Sess. 8 n. 16 (1976). It would avoid, however, the imposition on a defendant — often, as here, a financially hard pressed unit of state or local government — of an award that would clearly be a windfall, to wit, compensation for overhead that is required for the business of a large private law firm but is many times what the non-profit organization incurs or needs, not to speak of a profit element. The difficulties supposed to inhere in the calculation of the overhead factor are imaginary.1 The non-profit office must keep records of its overhead and of the number and salaries of its attorneys for a variety of other purposes, see Copeland v. Marshall, supra, 641 F.2d at 928 n. 51 (dissenting opinion of Judge Wilkey), and any reasonable method of allocation, e.g., a weighted dollar-hour basis, should be acceptable. Courts seem to have become bemused by the apparent simplicity of “hourly billing rates” and apply these mechanically, without knowing just what they reflect2 or to what use they are put.3
I recognize, however, that our decisions in Torres v. Sachs, 538 F.2d 10, 13 (2 Cir.1976) and Beazer v. New York City Transit Authority, 558 F.2d 97, 100 (2 Cir.1977), rev’d on other grounds, 440 U.S. 568, 99 S.Ct. 1355, 59 L.Ed.2d 587 (1979), look the other way, although the former, in a case where the award was $23,252, made no real analysis of the problem and the latter simply followed in its path. Hence, pending the clarification which hopefully will come from the Supreme Court in Blum v. Stenson, 671 F.2d 493, cert, granted, — U.S. —, 103 S.Ct. 2426, 77 L.Ed.2d 1314 (1983), I am willing to accept Judge Newman’s “break point” approach as a solution which is more equitable to the defendants than the un*1156checked “hourly billing rate” method and still is eminently fair to the plaintiffs.

. The debate in Copeland v. Marshall, 641 F.2d 880, 896-900, 926 (D.C.Cir.1980) (en banc), concerned a slightly different subject — the allocation of the overhead of a large private law firm. Even as to this somewhat more complicated problem, the majority exaggerated the difficulties.

. Hourly billing rates must include, in addition to the hourly compensation of associates and an imputed hourly compensation for partners, a proper allocation of overhead. No one seems to know to what extent they take account of the cost of hours that cannot be billed or must be billed at noncompensatory rates, or include a profit component even before adjustment to reflect the success of the firm’s efforts, compare Copeland v. Marshall, supra, 641 F.2d at 917-18, with Rodriguez v. Taylor, supra, 569 F.2d at 1247. Very likely different firms have different practices in these respects.

. Do they represent the fees billed in all cases, most cases, some cases? Are they a floor above which the firm endeavors to rise or a ceiling down from which it can be negotiated? Or, as seems most likely, are they simply figures to which the firm looks in exercising “billing judgment”? See Hensley v. Eckerhart, —U.S. —, —, 103 S.Ct. 1933, 1943, 76 L.Ed.2d 40 (majority opinion of Justice Powell), —, 103 S.Ct. at 1943 (concurring opinion of Chief Justice Burger), —, 103 S.Ct. at 1945 (concurring and dissenting opinion of Justice Brennan) (1983). As Judge Newman points out, note 10, the “billing judgment” of the Cravath firm, whose “hourly billing rates” were used by the district judge in fixing plaintiffs’ compensation, is to ask for considerably less when seeking compensation under § 1988, McCann v. Coughlin, 698 F.2d 112 (2 Cir. 1983); see also Rodriguez v. Taylor, supra, 569 F.2d at 1248 n. 29.