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United States of America v. $28

February 11, 2013


The opinion of the court was delivered by: Honorable Larry Alan Burns United States District Judge



In this forfeiture case, Claimant Robert Moser successfully obtained return of the Defendant currency, and moved pursuant to the Civil Asset Forfeiture Reform Act of 2000 (CAFRA) for attorney's fees of over $50,000. The government filed an opposition, arguing that if fees are awarded, they should be reduced. Moser also requested costs, but those have already been taxed. What is at issue here is a fee award only. The parties are familiar with the procedural history, which is not repeated here except as necessary in the course of discussion.

There is no real dispute here that Moser substantially prevailed and is eligible for a fee award under CAFRA. The focus of the briefing is on the amount of the award. Moser, as the party seeking a fee award, bears the burden of showing he is entitled to it and what it should be. See Harris v. Maricopa County Superior Court, 631 F.3d 963, 971--72 (9th Cir. 2011) (in cases involving attorney's fees generally, the burden falls solely on the claimant). See also Blum v. Stenson, 465 U.S. 886, 896 n.11 (1984) (burden on claimant to show what reasonable hourly rate was).

The government seeks to limit the award to the fees actually provided for under the retainer agreement, while Moser argues the lodestar approach should be used, which would likely result in a higher award. The government cites United States v. $186,416.00 in U.S. Currency, 642 F.3d 753, 755 (9th Cir. 2011) for the principle that the fee agreement can be considered when determining a reasonable fee in CAFRA cases. Moser does not dispute this, but rightly points out that the payment provided in the fee agreement is not a cap. Id. at 755. Moser is also correct that the lodestar method is to be used. See id. at 754--55. The statutory language, providing for an award of fees "incurred by the claimant" does not limit the award to actual fees. See Blanchard v. Bergeron, 489 U.S. 87, 90 (1989) (when using lodestar method, fee award was not limited to contingent-free agreement between attorney and client).

Using the lodestar method, the Court first makes an initial estimate of reasonable fees by multiplying the number of hours reasonably expended on the litigation by a reasonable hourly rate. Blanchard, 489 U.S. at 94 (citing Hensley v. Eckerhart, 461 U.S. 424 (1983); Blum v. Stenson, 465 U.S. 886, 888 (1984)). The initial estimate may then be adjusted based on other factors, known as Johnson factors after Johnson v. Georgia Highway Express, 488 F.2d 714 (5th Cir. 1974). See Blanchard, 489 U.S. at 94; see also id. at 91--92 (discussing Congress' reliance on Johnson factors). Those factors are:

(1) the time and labor required; (2) the novelty and difficulty of the questions; (3) the skill requisite to perform the legal service properly; (4) the preclusion of other employment by the attorney due to acceptance of the case; (5) the customary fee; (6) whether the fee is fixed or contingent; (7) time limitations imposed by the client or the circumstances; (8) the amount involved and the results obtained; (9) the experience, reputation, and ability of the attorneys; (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. (These are also known as Kerr factors, after Kerr v. Screen Extras Guild, Inc., 526 F.2d 67 (9th Cir. 1975).) Reasonable fees are adequate to attract competent counsel, but do not produce windfalls to attorneys. Blanchard, 489 U.S. at 92 n.6 (citing legislative history).

Reasonable Hourly Rate

Moser's briefing focuses a great deal on the hourly rate. He argues that the relevant comparison is to "federal practitioners possessing high levels of skill and experience" in the greater San Diego legal communities. While Moser's counsel, Richard Barnett, cites evidence he is very experienced and has been identified as an expert in forfeiture law, the question is really what level of skill, training, and experience was required in this case. See Blum, 465 U.S. at 886 n. 11 (reasonable rate should be "in line with those prevailing in the community for similar services by lawyers of reasonably comparable skill, experience and reputation") (emphasis added). Moser cites evidence that similarly experienced counsel in civil forfeiture cases in this District customarily bill from $400 to $700 per hour. (Fee Mot. at 6:17--26.) The evidence, however, suggests this is the customary rate of litigators in various types of cases, not just civil forfeitures. In other words, the customary fees represent an average for all types of litigation work. Some areas (e.g., patent or securities) obviously command higher fees than others (e.g., criminal defense in drug cases). It is therefore not a particularly accurate representation of what the going rate is in this market for this type of work.

While this was a civil forfeiture case, the central issue was the legality of a search and seizure. The heart of this case was a motion to suppress. In this respect, the legal skills required are more similar to those of a criminal defense attorney. The law governing forfeitures did come into play, but the focus here was on criminal procedure much more than forfeiture law. After the initial client interview, this would have been obvious to Barnett or any other attorney practicing in this field. Defense attorneys' customary rates in this District are not as high as the rates Moser urges are the norm in forfeiture cases. For example, CJA panel members are required to be experienced and well-trained, yet the CJA hourly rate for appointed counsel in non-capital cases in this District is $125. / / /

It is also worth remembering that much of the work in a case like this is fairly routine, and the degree of expertise required for those tasks is much lower. Typically, lawyers who work in firms delegate this work to junior associates or paralegals, who bill at lower rates. Some work is delegated to staff who do not bill at all, and their cost is reflected in the attorneys' billing rates. Many of the lawyers whose declarations Moser relies on fall into this category; while they themselves might charge rates of $400 to $700 per hour, they would as a matter of course delegate work so that bills are reasonable. For example, Barnett not only interviewed Moser, made appearances before the magistrate, communicated with opposing counsel, and directed litigation strategy, all typically carried out by more experienced counsel; but he also compiled exhibits, drafted responses to interrogatories, and researched and drafted whole pleadings,*fn1 tasks typically carried out for the most part by more junior staff.

If Barnett had delegated work as is typical in larger law offices and firms, his requested rate of $500 per hour might be reasonable. Had he done so, he would also have submitted billings from attorneys or paralegals with lower billing rates, and the average hourly billing rate for the entire case would have been quite a bit less than $500. A case Moser himself cites illustrates this point. In United States v. 4,432 Mastercases of Cigarettes, 322 F. Supp. 2d 1075, 1078--79 (C.D.Cal., 2004), vacated on other grounds, 448 F.3d 1168 (9th Cir. 2006), the court held that the requested $400 hourly rate was reasonable. That decision, however, found the $400 rate was reasonable for lead counsel and co-counsel only; the two associates were billed at $195 per hour. Compare Gold v. NCO Financial Systems, Inc., 2010 WL 3339498 at *2--*3 (S.D.Cal., Aug. 23, 2010) (determining reasonable fees for attorneys and a paralegal).

While delegation of less-expert tasks is not required in the practice of law, an attorney who does all levels of work - the demanding and sophisticated as well as the basic and routine - would typically bill at a lower hourly rate than one who does only the most difficult work. This avoids "top-heavy" billing that the market will not support. See Bridgeport Music, Inc. v. WB Music Corp., 520 F.3d 588, 596 (6th Cir. 2008) (approving district court's reduction of ...

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