Court Opinion

ID: 2983021
Source: CourtListenerOpinion
Date Created: 2015-09-22 20:48:07.533582+00
Date Added: 2024-06-11T15:03:14.046130
License: Public Domain

NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
                          File Name: 15a0580n.06

                                       Case No. 14-3788

                          UNITED STATES COURT OF APPEALS
                               FOR THE SIXTH CIRCUIT

                                                                                   FILED
JAMES DEAN, JR.,                                   )                         Aug 14, 2015
                                                                         DEBORAH S. HUNT, Clerk
                                                   )
       Plaintiff-Appellee,                         )
                                                   )       ON APPEAL FROM THE UNITED
v.                                                 )       STATES DISTRICT COURT FOR
                                                   )       THE NORTHERN DISTRICT OF
F.P. ALLEGA CONCRETE                               )       OHIO
CONSTRUCTION CORP.,                                )
                                                   )
       Defendant-Appellant.                        )
                                                   )

       BEFORE: NORRIS, SUTTON, and DONALD, Circuit Judges.

       SUTTON, Circuit Judge. James Dean worked, among other jobs, as a laborer for Allega

Concrete until the company laid him off during a reduction in force. Dean filed this lawsuit in

response. He did not challenge the layoff; he claimed that his employer had failed to pay him

overtime wages and a minimum wage in violation of state law and the Fair Labor Standards Act.

29 U.S.C. §§ 206–207. The district court rejected most of Dean’s claims as a matter of law. The

jury granted him $117 in relief on one claim. And the court awarded him $25,422 in attorney’s

fees. Allega appeals the fee award but not the damages award. Because the district court failed

to explain the basis for such a large fee award in connection with such a small merits victory, we

reverse the fee award.
Case No. 14-3788, Dean v. F.P. Allega Concrete Construction Corp.

       Dean’s lawsuit claimed that Allega adopted a complex strategy to short him overtime:

paying him double for half his overtime hours, not paying him at all for the other half, and thus

effectively paying him a regular hourly wage for all of his overtime hours. Dean also claimed

that Allega failed to pay him for time spent loading trucks each morning and returning them each

night. All told, Dean sought $29,659 in back pay.

       The district court found that most of Dean’s claims were without cause as a matter of

law. It granted a directed verdict for Allega on three of Dean’s claims: an Ohio state-law claim,

promissory estoppel, and unjust enrichment. The jury also found that the remaining claim—the

FLSA overtime claim—was largely without merit. It rejected his underlying theory but did

award him $58.50 in overtime due to a bookkeeping error with respect to one day’s paycheck.

The district court entered judgment for Dean on this one issue and awarded an additional $58.50

in liquidated damages under the FLSA, 29 U.S.C. § 216(b), bringing the total award to $117.

       Dean moved for $36,795 in attorney’s fees based on roughly 130 hours of work and a

rate of $275 an hour. See id. As to the hours worked, the district court said only that they were

“neither excessive nor inefficient.” See Dean v. F.P. Allega Concrete Constr. Corp., No. 1:13-

CV-962, 2014 WL 3547149, at *3 (N.D. Ohio July 16, 2014). As to the rate, the court dropped it

to $190 per hour to reflect the relevant market rate and the attorney’s limited experience. Id. at

*2. The result: a $25,422 fee award, which is more than 217 times the size of the damages

award. Allega appeals the fee award.

       A few basics are in order. The district court had ample authority to grant some fees for

Dean’s victory, small though it was. See 29 U.S.C. § 216(b); United Slate Workers Ass’n, Local

307 v. G & M Roofing & Sheet Metal Co., 732 F.2d 495, 501 (6th Cir. 1984). In determining the

amount of any award under the FLSA, courts start with the lodestar amount: the number of

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Case No. 14-3788, Dean v. F.P. Allega Concrete Construction Corp.

hours worked times a reasonable hourly rate. See Hensley v. Eckerhart, 461 U.S. 424, 433

(1983). This calculation “does not end the inquiry,” however. Id. at 434. A district court also

must look to “other considerations that may lead the district court to adjust the fee upward or

downward”—“the most critical factor” of which “is the degree of success obtained.” Id. at 434,

436. Last of all, we give considerable deference to the district court in reviewing the size of any

award. Trial courts have a “superior understanding of the litigation,” id. at 437, such awards are

“predominately fact-driven,” Imwalle v. Reliance Med. Prods., Inc., 515 F.3d 531, 551 (6th Cir.

2008), and it does more harm than good to engage in “appellate micromanagement” of fee

awards, Fox v. Vice, 131 S. Ct. 2205, 2216 (2011).

       All of this creates considerable inertia in favor of upholding fee awards. But there are

two problems with this award, problems that, even under the most modest level of scrutiny, we

cannot overlook. First, the court failed to consider the relationship between the fee award and

the level of success obtained, as Hensley requires. A court must provide “a concise but clear

explanation of its reasons for the fee award.” Hensley, 461 U.S. at 437. And “[w]hen an

adjustment is requested on the basis of . . . [the] limited nature of the relief obtained by the

plaintiff”—as Allega requested here—the court “should make clear that it has considered the

relationship between the amount of the fee awarded and the results obtained.” Id. Nothing in the

district court’s opinion, or for that matter the record below, offers any indication that the court

considered the relationship between the fees awarded and the results obtained. That lack of

explanation is an abuse of discretion and by itself requires vacating the award. See Drennan v.

Gen. Motors Corp., 977 F.2d 246, 253 (6th Cir. 1992).

       Second, the court made no adjustment to the fees based on Dean’s limited—indeed near

zero—success. This was a case about money, and Dean received little money. As the Supreme

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Case No. 14-3788, Dean v. F.P. Allega Concrete Construction Corp.

Court tells us, a district court must “focus on the significance of the overall relief obtained by the

plaintiff in relation to the hours reasonably expended on the litigation.” Hensley, 461 U.S. at

435. The relief obtained was minute: $117. The hours expended were not: 133.8. Perhaps if

Dean’s suit had “vindicat[ed] . . . congressionally identified policies and rights,” Fegley v.

Higgins, 19 F.3d 1126, 1135 (6th Cir. 1994), the number of hours spent in this litigation would

have been reasonable. But the jury rejected Dean’s entire theory of the case and granted relief

due only to an exceedingly minor bookkeeping mistake—which by itself would never have

triggered a lawsuit. It is a heavy lift to say that this lawsuit vindicated the broader purposes of

the FLSA. See United Slate, 732 F.2d at 501–02.

       Dean offers three responses, but each misses the mark. Dean fears that any disturbance

of the fee award would require a fixed proportionality analysis that mathematically links the fee

award to the damages award. But nothing of the sort is required. What is required is that the

district court offer a reasoned explanation that justifies the award and accounts for Dean’s

modest degree of success. Dean’s case citations hold nothing to the contrary. They uphold fee

awards that are a far cry from the fee awarded here and that did consider the degree of success

obtained. See, e.g., Fegley, 19 F.3d at 1135 (upholding $40,000 in fees for $7,680 recovery).

       Dean adds that, because his “successful” FLSA claim was related to the three other

claims, he may recover the entire cost of litigating the case. Hensley says otherwise. The

lodestar method may result in “an excessive amount . . . even where the plaintiff’s claims were

interrelated, nonfrivolous, and raised in good faith. . . . Again, the most critical factor [in

adjusting the lodestar result] is the degree of success obtained.” Hensley, 461 U.S. at 436.

       Dean submits that Allega “waived” its objections to the fee award by failing to raise them

before the district court. No such waiver—in truth no such forfeiture, see United States v. Olano,

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Case No. 14-3788, Dean v. F.P. Allega Concrete Construction Corp.

507 U.S. 725, 733 (1993)—occurred. Throughout its district court brief, Allega emphasized that

Dean did not deserve any fees at all because he proved nothing but a clerical error. Allega

argued that “[t]he complete lack of evidence clearly distinguishes this case” from others

awarding fully compensatory fees. R. 31 at 3. “[A]n award of any significance,” Allega

concluded, “is contrary to equity and the spirit of the statute.” Id. at 5. Allegra did not forfeit its

challenge to the fee award.

       For these reasons, we reverse the fee award and remand for further proceedings not

inconsistent with this opinion.

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Case No. 14-3788, Dean v. F.P. Allega Concrete Construction Corp.

       BERNICE BOUIE DONALD, Circuit Judge, concurring only in the judgment. I

agree with the majority that the district court must support its fee calculation to enable review,

and for that reason, I concur in the majority’s judgment. However, I have reservations regarding

the majority’s articulation of existing law regarding fee awards under the FLSA, because I

believe the lodestar approach used by the court in calculating fees is presumptively reasonable.

       The FLSA and its kin among civil rights laws are not average statutes. It is well known

that parties typically pay their own attorney fees in the U.S. court system. See Hensley v.

Eckerhart, 461 U.S. 424, 429 (1983). However, in certain “fee-shifting” statutes, Congress

expressly permits—and sometimes requires—that a prevailing plaintiff recover reasonable

attorney fees from his opponent for successful litigation under the statute. Perdue v. Kenny A. ex

rel. Winn, 559 U.S. 542, 550 (2010). Congress includes such provisions to ensure that even the

most vulnerable plaintiffs are able to enforce certain essential statutory rights. Shifting the cost

of litigation not only emphasizes the importance of these rights—here, fair payment for hours

worked—but also reflects the unfortunate reality that many plaintiffs seeking to enforce these

rights often lack the power and means to do so. Id. The FLSA is one of these far-from-ordinary

statutes: its text directs that a court “shall” award attorney fees to a successful plaintiff.

29 U.S.C. § 216(b).

       The majority fails to recognize this mandate. We have expressly held that “[a]n award of

attorney fees to a prevailing plaintiff under § 16(b) of the FLSA is mandatory[.]” Fegley v.

Higgins, 19 F.3d 1126, 1134 (6th Cir. 1994); see also United Slate, Tile & Composition Roofers,

Damp and Waterproof Workers Ass’n, Local 307 v. G & M Roofing and Sheet Metal Co.,

732 F.2d 495, 501 (6th Cir. 1984). While the amount of fees awarded to the plaintiff remains

within the district court’s discretion, a court that refuses to award any fees to a successful

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Case No. 14-3788, Dean v. F.P. Allega Concrete Construction Corp.

plaintiff contradicts the plain language of the statute.1 Fegley, 19 F.3d at 1134; 29 U.S.C. §

216(b). If anything, failing to award fees would be an abuse of discretion, because it flatly

contradicts the law.

        The majority instead focuses on another aspect of the FLSA fees requirement: that the

amount awarded be reasonable. We have held that “reasonable” fees in the FLSA context are

those that are adequate to attract competent counsel, but which do not produce a windfall for the

attorney. Lavin v. Husted, 764 F.3d 646, 649 (6th Cir. 2014) (quoting Reed v. Rhodes, 179 F.3d

453, 471 (6th Cir. 1999); Adcock-Ladd v. Sec’y of Treasury, 227 F.3d 343, 349 (6th Cir. 2000)).

This definition reflects the policy supporting fee awards in civil rights cases: access to the courts

for plaintiffs who might otherwise not be able to engage an attorney on their behalf. There are

two possible approaches to calculating a “reasonable” fee in the FLSA context.

        The opinion in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir. 1974),

presents one approach. In that case, the Fifth Circuit addressed whether a district court had

appropriately calculated the attorney fees it awarded to a plaintiff. Because the district court

“judgment d[id] not elucidate the factors which contributed to the decision and upon which it

was based[,]” the Court of Appeals identified twelve factors to guide its reconsideration on

remand: 1) the time and labor required; 2) the novelty and difficulty of the legal questions;

3) the skill requisite to perform the legal service properly; 4) preclusion of other employment by

the attorney due to acceptance of the case; 5) the customary fee; 6) whether the fee was fixed or

contingent; 7) the time limitations imposed by the client or circumstances; 8) the amount

1
 The U.S. District Court for the Northern District of Ohio, which heard this case below, has consistently observed
this rule. See, e.g., Gomez v. ERMC Prop. Mgmt. Co., LLC, No. 3:13-CV-01081, 2014 WL 3053210, at *2 (N.D.
Ohio July 7, 2014); Snide v. Disc. Drug Mart, Inc., No. 1:11 CV 00244, 2013 WL 6145130, at *4 (N.D. Ohio Nov.
21, 2013); White v. All About Cable Connections, LLC, No. 1:12CV1708, 2013 WL 2949920, at *3 (N.D. Ohio June
13, 2013); Abdelkhaleq v. Precision Door of Akron, No. 5:07 CV 3585, 2010 WL 395236, at *6 (N.D. Ohio Jan. 25,
2010).

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Case No. 14-3788, Dean v. F.P. Allega Concrete Construction Corp.

involved and results obtained; 9) the experience, reputation, and ability of the attorney; 10) the

undesirability of the case; 11) the nature and length of the professional relationship with the

client; and 12) awards in similar cases. Johnson, 488 F.2d at 717-19.

       The more common approach is the “lodestar” method, in which the court determines a

reasonable hourly rate for the jurisdiction of the case and multiplies that rate by the reasonable

number of hours counsel dedicated to the case. The Supreme Court favors this method over the

Johnson approach, for several reasons:

               First, in accordance with our understanding of the aim of fee-
               shifting statutes, the lodestar looks to the prevailing market rates in
               the relevant community. Developed after the practice of hourly
               billing had become widespread, the lodestar method produces an
               award that roughly approximates the fee that the prevailing
               attorney would have received if he or she had been representing a
               paying client who was billed by the hour in a comparable case.
               Second, the lodestar method is readily administrable, and unlike
               the Johnson approach, the lodestar calculation is “objective,” and
               thus cabins the discretion of trial judges, permits meaningful
               judicial review, and produces reasonably predictable results.

Perdue, 559 U.S. at 551-52 (internal citations and quotation marks omitted). The Supreme Court

has established a “strong presumption” that the lodestar amount represents a “reasonable” fee in

the context of a fee-shifting statute like the FLSA:

               The lodestar figure has, as its name suggests, become the guiding
               light of our fee-shifting jurisprudence. We have established a
               strong presumption that the lodestar represents the reasonable fee,
               and have placed upon the fee applicant who seeks more than that
               the burden of showing that such an adjustment is necessary to the
               determination of a reasonable fee.

City of Burlington v. Dague, 505 U.S. 557, 562 (1992) (citing Pennsylvania v. Delaware Valley

Citizens’ Council for Clean Air, 478 U.S. 546, 565 (1986); Blum v. Stenson, 465 U.S. 886, 898

(1984) (internal citations and quotation marks omitted)).

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Case No. 14-3788, Dean v. F.P. Allega Concrete Construction Corp.

       We have recognized that additional factors like those in Johnson aid a district court in

adjusting its calculation of attorney fees after establishing its lodestar baseline. Lavin, 764 F.3d

at 649. Indeed, as the majority notes, a district court properly proceeds to an inquiry beyond the

lodestar amount if a party presents specific evidence that the case at bar is rare or exceptional.

Adcock-Ladd, 227 F.3d at 350 (quoting Delaware Valley, 478 U.S. at 565). Allega’s brief in

opposition to Dean’s motion for fees argued that awarding fees would be unfair due to various

specific elements of Dean’s case, each of which speak to the company’s general assertion that

Dean’s action case does not reflect the ideals behind the FLSA. In Fegley, we explained that

               The purpose of the FLSA attorney fees provision is to insure
               effective access to the judicial process by providing attorney fees
               for prevailing plaintiffs with wage and hour grievances. Courts
               should not place an undue emphasis on the amount of the plaintiff's
               recovery because an award of attorney fees here encourages the
               vindication of congressionally identified policies and rights.
               Indeed, we have upheld substantial awards of attorney fees even
               though a plaintiff recovered only nominal damages.

Fegley, 19 F.3d at 1134-35 (internal quotation marks and edits omitted). The relationship

between damages and fees awarded in a FLSA case, therefore, is complex.

       The majority emphasizes the fact that Dean’s recovery was just over $100, yet the district

court awarded him thousands in attorney fees. Where a district court opts to adjust its lodestar

amount, the plaintiff’s degree of success on his claims is a key element of that inquiry. Adcock-

Ladd, 227 F.3d at 349. I believe it is vital to the consistency of this court’s FLSA jurisprudence

to highlight, however, that the mere existence of a large difference between damages awarded

and fees requested does not, by itself, indicate that a district court abused its discretion in

conducting the necessary calculations.

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Case No. 14-3788, Dean v. F.P. Allega Concrete Construction Corp.

        The very nature of these cases is likely to yield inconsistent results. The law recognizes

that there are no guaranteed results in litigation. Thus, the fact that a plaintiff is only successful

on certain claims should not be the sole measure of the amount of the award. That is precisely

the reason we defer to the court that oversees a case: that court has an unmatched familiarity with

the record, the parties, and the claims at hand, because it has managed the litigation over time.

The district court in this case failed to share that critical insight in its opinion. For that reason, I

concur in the judgment.

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