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Friedman v. California State Employees Association

July 20, 2010

DAVID M. FRIEDMAN ET AL., ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, PLAINTIFFS,
v.
CALIFORNIA STATE EMPLOYEES ASSOCIATION, ET AL., DEFENDANTS.



MEMORANDUM AND ORDER RE: MOTION FOR ATTORNEYS' FEES, COSTS, AND EXPENSES

As the court entered judgment in favor of plaintiffs (Docket No. 277) on claims 3, 4, 5, 7, and 8 of their Complaint in accordance with the Order Staying Further Proceedings Pending Conclusion of Related Case of August 14, 2001 (Docket No. 261), the Memorandum and Order of November 15, 2000 (Docket No. 255), the Court's Memorandum and Order of June 20, 2006 in the related case, Cummings v. Connell, No. 99-2176, 2006 WL 1716160 (E.D. Cal. 2006) (Cummings Docket No. 270) and the Amended Judgment therein (Cummings Docket No. 272), plaintiffs now move for an award of attorney's fees, costs, and expenses pursuant to 42 U.S.C. § 1988, Federal Rules of Civil Procedure 23(h) and 54(d)(2) and Local Rule 293.

I. Factual and Procedural Background

Plaintiffs filed suit against defendants on January 18, 2000, on behalf of themselves and a class of approximately 10,000 nonunion employees of the California State University in bargaining units 2, 5, 7, and 9 represented by defendant California State Employees Association ("CSEA"), alleging, inter alia, that as of January 1, 2000 CSEA would improperly withhold a portion of union dues from their paychecks without providing them with the procedural safeguards required by Chicago Teachers Union v. Hudson, 475 U.S. 292 (1986). Between November 1999 and January 2000, CSEA mailed three notices---referred to in this litigation as the Original, Amended, and January notices--to all nonunion members of bargaining units 2, 5, 7, and 9 informing them of their "fair share fee" and their right to object and pay a reduced fee. Plaintiffs alleged that all three notices failed to meet Hudson's requirements because they failed to include a copy of the related financial audit or did not provide nonmembers a reasonable opportunity to object.

On November 15, 2000, the court granted defendants' motion for summary judgment with respect to claims one and two of the Complaint (Docket No. 255). Those claims challenged the facial constitutionality of section 2583.5 of the California Government Code, which required nonmembers to either join the union or pay a "fair share service fee." On August 14, 2001, the court granted a joint motion to stay the remainder of plaintiffs' claims pending final resolution of the related case of Cummings v. Connell, No. 99-2179 WBS DAD (E.D. Cal.). (Order Staying Further Proceedings (Docket No. 261).) The parties agreed: to be bound by the legal principles finally established in Cummings and apply them to the present case in a good faith effort to resolve the case . . . . This includes, but is not limited to, an agreement that if it is ultimately determined in Cummings that one or more of CSEA's Hudson notices in that case were legally deficient, then CSEA will accept, for settlement purposes, that the corresponding one or more of CSEA's Hudson notices in this case were similarly deficient. (Id. at 1-2.) The court determined that the notices at issue in Cummings---April 1999, June 1999, and two January 2000 notices--were constitutionally deficient for various reasons and granted plaintiffs' motion for summary judgment with respect to all four notices. Cummings, 177 F. Supp. 2d 1060, 1064-68 (E.D. Cal. 2001).

The notices at issue in this litigation suffered from the same alleged procedural deficiencies that the court found in the Cummings litigation to be, and the Ninth Circuit upheld as, constitutionally deficient under Hudson. Pursuant to the parties' prior agreement, the rulings in Cummings, and plaintiffs' unopposed motion for entry of final judgment (see Docket Nos. 267, 271, 274), on February 24, 2010 the court entered final judgment in favor of plaintiffs as to claims 3, 4, 5, 7, and 8 of the Complaint and awarded each plaintiff and class member nominal damages in the amount of $1.00, entered final judgment in favor of defendants with respect to claims 1 and 2 of the Complaint, and dismissed as moot claims 6, 9, and 10 of the Complaint. (Docket No. 277.)

Pursuant to Federal Rule of Civil Procedure 23(h)(1), the parties drafted a class notice regarding the attorneys' fee agreement, which was approved by the court on April 28, 2010 (Docket No. 291), and dispatched the notice to all class members on May 28, 2010 and June 7, 2010. (June 16, 2010 Certification of Mailing (Docket No. 292).) Three class members have filed written objections to the notice of motion regarding attorneys' fees. (Supp. Chappell Decl. (Docket No. 294).) Plaintiffs now move for an order awarding fees and costs of $45,500.00 as agreed to by the parties. Defendants have filed a statement of non-opposition to plaintiffs' motion. (Docket No. 293.)

II. Discussion

Plaintiffs request---and defendants agree to pay-- $45,500 in attorney's fees and costs under 42 U.S.C. § 1988 and Federal Rule of Civil Procedure 23(h). 42 U.S.C. § 1988(b) provides for reasonable attorney's fees to the prevailing party in an action brought under 42 U.S.C. § 1983, and Rule 23(h) provides for attorney's fees and costs in class action suits. Additionally, out-of-pocket litigation expenses are reimbursable as a part of attorneys' fees. Harris v. Marhoefer, 24 F.3d 16, 19 (9th Cir. 1994). Although Rule 23(h) provides that attorneys' fees in class actions cannot be paid except pursuant to a Rule 54(d)(2) motion, the commentary to Rule 23(h) and Rule 54(d)(2)(B) make clear that fee agreements are relevant to what amount of fees should be awarded. Where, as here, the amount of fees to be paid has been agreed upon subject to court approval, the court must ensure that the interests of the class are protected and have not been sacrificed to the advantage of the defendant and the plaintiff's attorneys. See, e.g., Zucker v. Occidental Petroleum Corp., 192 F.3d 1323, 1397 (9th Cir. 1999) (noting that class action suits create "opportunities for collusive arrangements" among the parties and their attorneys).

In this case, the court can not conceive of any danger of collusion between the parties with regard to the settlement agreement for attorneys' fees. All of the claims in this litigation were either decided on summary adjudication by this court, settled in favor of plaintiffs due to the rulings in the Cummings litigation, or eventually mooted by defendants' subsequent notice that complied with Hudson. The attorneys' fees claim was not part of the settlement of any other claim and, hence, the agreed-upon amount is unaffected by any compromise of the claims of the class. Payment of an agreed-upon amount of attorneys fees is therefore not contrary to the interests of the class.

Furthermore, the parties agree---and the court so finds---that plaintiffs qualify as a "prevailing party" for § 1988 purposes and are presumptively entitled to attorneys' fees because they prevailed on at least some of their claims under § 1983. See Sable Commc'ns v. Pac. Tel. & Tel., 890 F.2d 184, 193 (9th Cir. 1989) ("Plaintiffs prevailing in a civil rights action should ordinarily receive attorney's fees unless special circumstances would render such an award unjust."). This court is not aware of any special circumstances which would justify denying an award of fees and costs.

To determine a reasonable attorney fee in this case, the court must first calculate the lodestar by taking the number of hours reasonably expended by the litigation and multiplying it by a reasonable hourly rate. Fisher v. SJB-P.D. Inc., 214 F.3d 1115, 1119 (9th Cir. 2000) (citing Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)). There is a strong presumption that the lodestar amount is reasonable. Fischer, 214 F.3d at 1119 n.4 (citation omitted). The district court may exclude from the initial fee calculation hours that were "excessive, redundant, or otherwise unnecessary." Hensley, 461 U.S. at 434. The court may then adjust the lodestar based on an evaluation of the factors articulated in Kerr v. Screen Extras Guild, Inc., 536 F.2d 67 (9th Cir. 1975) that are not subsumed under the lodestar calculation.*fn1 Id. The fee applicant bears the burden of documenting the appropriate hours expended in the litigation and must submit evidence in support of those hours worked. Hensley, 461 U.S. at 433.

"The extent of a plaintiff's success is a crucial factor in determining the proper amount of an award of attorney's fees under 42 U.S.C. § 1988." Hensley, 461 U.S. at 440. Hensley prescribed a two-step process for calculating attorney's fees in a case of partial or limited success. A court must consider (1) whether "the plaintiff fail[ed] to prevail on claims that were unrelated to the claims on which he succeeded," and (2) whether "the plaintiff achiev[ed] a level of success that makes the hours reasonably expended a satisfactory basis for making a fee award." Hensley, 461 U.S. at 434. Deductions based on limited success are within the discretion of the district court. Watson v. County of Riverside, 300 F.3d 1092, 1096 (9th Cir. 2002).

A. Lodestar Calculation

Plaintiffs propose that a base lodestar figure of $129,342.50 would be an appropriate amount of attorneys' fees in this case. This amount accounts for the hours principally expended by Milton L. Chappell, a staff attorney at the National Right to Work Legal Defense Foundation (the "Foundation"), and by Dylan B. Carp, who was then a second- and third-year attorney at the ...


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