Court Opinion

ID: 6936811
Source: CourtListenerOpinion
Date Created: 2022-07-24 00:38:05.598114+00
Date Added: 2024-06-11T16:07:31.034862
License: Public Domain

O’SCANNLAIN, Circuit Judge,
dissenting:
The statute at issue, 28 U.S.C. § 1447(c), sets forth procedures for plaintiffs to remand a ease to state court when the defendant improperly removed the case to federal court. Of relevance here, that section provides that “[a]n order remanding the case may require payment of just costs and any actual expenses, including attorney fees, incurred as a result of the removal.” The majority maintains that under such language a district court must award attorneys’ fees to a litigant who had not actually incurred an obligation to pay those fees. I respectfully dissent from that portion of the opinion.
This issue appears to be one of first impression. The majority points to Moore v. Permanente Medical Group, Inc., 981 F.2d 443 (9th Cir.1992), where we awarded attorneys’ fees under section 1447(c) to an attorney who was hired on a contingency fee basis; however, that case did not present the question of statutory interpretation at issue here. Here, the question is whether a statute which provides for the award of “any actual expenses” (expressly including attorneys’ fees) that are “incurred” as a result of an improper removal, contemplates an award of fees to a plaintiff who had no obligation to pay for legal services performed in connection with the removal. I believe that if any weight is to be given to the words chosen by Congress, then to ask the question is to answer it.
It must be assumed that when Congress chose the words “just costs and any actual expenses, including attorney fees, incurred as a result of the removal,” it meant what it said. Consequently, the statute means that a defendant who improperly removes a case to federal court may be liable for costs but only for such attorneys’ fees that the plaintiff is actually obligated to pay as a result of the removal episode. I find support for this construction of section 1447(c) in a comparison with other federal statutes awarding attorneys’ fees.
The language of section 1447(c) is quite different from that of numerous other federal fee-shifting statutes, which provide for an award of “a reasonable attorney’s fee” to the prevailing party without any further qualification.1 Under most such statutes, reasonable attorneys’ fees are expressly included as “costs” or separately listed. My research has revealed no other federal fee-shifting statute which limits attorney fee awards, “reasonable” or otherwise, to “actual expenses ... incurred.” Obviously, when the statute permits an award of “reasonable” *1490attorneys’ fees, it makes no difference whether a plaintiff has a contingency fee agreement with his or her attorney, and courts have devised various formulas for determining what is a “reasonable fee.” See Hensley v. Eckerhart, 461 U.S. 424, 433-37, 103 S.Ct. 1933, 1939-41, 76 L.Ed.2d 40 (1983); Kerr v. Screen Extras Guild, Inc., 526 F.2d 67, 69-70 (9th Cir.1975), cert. denied, 425 U.S. 951, 96 S.Ct. 1726, 48 L.Ed.2d 195 (1976). In drafting section 1447(c), however, Congress elected to diverge both from the “reasonable attorneys’ fee” language almost universally used and the inclusion of such fees as costs. Given this divergence, I cannot help but conclude that Congress’ choice of language in section 1447(c) was significant.
Gotro first argues that the contingency fee agreement that she entered into did impose on her an obligation to pay attorneys’ fees under circumstances such as this one. Gotro points to the “Statutory Fees” provision of her contingency fee agreement, particularly the provision that “all attorney fees that may be recovered from defendants, by settlement or litigation, pursuant to any law ... shall belong to the attorney.” Gotro maintains that the quoted provision is an assignment of a contingent benefit under contract law. According to Gotro, the provision means that as soon as the contingency occurs — that is, when attorneys’ fees are awarded — then she incurred the obligation of paying her attorneys the fees that were awarded. The fact that she arranged to discharge that obligation by an advance assignment, she argues, does not change the fact that upon the occurrence of the contingency, the obligation for payment was incurred.
Such an interpretation of Gotro’s contingency fee agreement is implausible. The fact is, if Gotro were eventually to recover damages, she would owe her attorneys the same percentage of the damages regardless of whether the case had previously been improperly removed. Similarly, if Gotro were later to recover nothing, then she would owe her attorneys nothing, despite their having contested the improper removal. Thus, it is clear that Gotro incurred no expenses (including attorney fees) as a result of the removal and consequently was entitled to no award under section 1447(c).
Gotro next contends that section 1447(c) was intended to deter improper removals and that this purpose would be poorly served if the statute were read to eliminate a defendant’s obligation to pay attorneys’ fees for improperly removed cases whenever the defendant’s opponent was represented by an attorney on a contingency fee. There are two obvious replies to such contention. First, given the clear language of the statute, it must have been designed primarily to reimburse plaintiffs for unnecessary litigation costs. Thus, plaintiffs who actually incur litigation costs should be reimbursed while those who have not incurred any costs should have no such claim. Second, an attorney who is entering into a contingency fee arrangement with a client can easily draft the contingency fee agreement to provide that in the event of a section 1447(c) prevailing result, the client shall be obligated to pay actual fees. Such a provision will, in turn, trigger the defendant’s obligation for attorneys’ fees under section 1447(c) and thus will make the attorney whole and will not unfairly prejudice the client.
In this case, however, Gotro had not incurred an obligation to pay her attorneys any fees as a result of the removal;2 thus, I would hold that the district court erred in making an attorney fee award to her.

. See, e.g., 5 U.S.C. § 5596(b)(l)(A)(ii) (“[Plaintiff] ... is entitled ... to receive ... reasonable attorney fees related to the personnel action."); 11 U.S.C. § 523(d) ("The court shall grant judgment ... for the costs of, and a reasonable attorney's fee for the proceeding.”); 12 U.S.C. § 3417(a)(4) (“[Defendant] is liable to the customer ... in an amount equal to ... the costs of the action together with reasonable attorney's fees as determined by the court.”); 15 U.S.C. § 78u(h)(7)(A)(iii) ("[Plaintiff is entitled to] ... the costs of the action and reasonable attorney's fees as determined by the court.”); 15 U.S.C. § 1640(a) ("[Defendant is liable for] ... the costs of the action, together with a reasonable attorney’s fee as determined by the court.”); 15 U.S.C. § 1692K(a)(3) (“[Defendant is liable for] ... the costs of the action, together with a reasonable attorney's fee as determined by the court."); 16 U.S.C. § 1540(g)(4) ("The court ... may award costs of litigation (including reasonable attorney and expert witness fees) to any party.”); 18 U.S.C. § 1964(c) ("[Plaintiff] shall recover threefold the damages he sustains and the cost of the suit, including a reasonable attorney’s fee."); 18 U.S.C. § 2520(c) ("Plaintiff shall ... be entitled to recover ... a reasonable attorney’s fee and other litigation costs reasonably incurred.”); 29 U.S.C. § 216(b) ("The court shall ... allow a reasonable attorney's fee to be paid by the defendant, and costs of the action."); 42 U.S.C. § 1988(b) ("The court ... may allow ... a reasonable attorney's fee as part of the costs.”); 42 U.S.C. § 2000e-5(k) (“The court may allow ... a reasonable attorney’s fee (including expert fees) as part of the costs....”); 42 U.S.C. § 6305(d) (“The court ... may award costs of litigation (including reasonable attorney and expert witness fees) to any party....”).

. Gotro's contingency fee agreement obligates her to pay "Litigation Costs and Expenses.” Thus, of course, Gotro should be entitled to be reimbursed for the costs of photocopying, amounting to $47.55, that are detailed in the affidavit, under either the "just costs” or “actual expenses ... incurred” portions of section 1447(c).