C. Introduction to Attorney’s Fees

Introduction to Attorney’s Fees

  1. In Alyeska Pipeline Service Co. v. Wilderness Society, 421 U.S. 240 (1975), the Court held that absent express congressional authorization, the equitable power of courts did not encompass awarding attorney’s fees to litigants who successfully represent the public interest. Congress responded by passage of the Civil Rights Attorney’s Fees Award Act of 1976, 42 U.S.C. § 1988, which provides in pertinent part:

    In any action or proceeding to enforce a provision of section … 1983 … of this title, the court, in its discretion, may allow the prevailing party, other than the United States, a reasonable attorney’s fee as part of the costs….

    A plaintiff who prevails “should ordinarily recover an attorney’s fee unless special circumstances would render such an award unjust.” S. Rep. No. 94-1011, p. 4 (1986) (quoting Newman v. Piggie Park Enterprises, Inc., 390 U.S. 400, 402 (1968)). On the other hand, the courts are to award fees to a prevailing defendant only “upon a finding that the plaintiff’s action was frivolous, unreasonable or without foundation, even though not brought in subjective bad faith.” Christiansburg Garment Co. v Equal Opportunity Employment Commission, 434 U.S. 412, 421 (1978); H.R. Rep. No. 94-1558, p. 7 (1976). For an analysis of the limited circumstances under which fees have been denied to plaintiffs or awarded to defendants, see Sheldon H. Nahmod, Civil Rights and Civil Liberties Litigation, Section 10:3 (Fourth Edition).

  2. While fee awards may not be entered against persons protected by absolute legislative immunity—which bars actions for legal as well as equitable relief—fees may be assessed when prospective equitable relief is entered against state and local officials acting in a prosecutorial capacity. Supreme Court of Virginia v. Consumers Union of the United States, 446 U.S. 719 (1981). In Pulliam v. Allen, 466 U.S. 522 (1984), the Court held that judges who were found liable for declaratory and injunctive relief are not immunized from attorney’s fees. However, Congress responded by amending Section 1988 to provide, “in any action brought against a judicial official for an act or omission taken in such officer’s judicial capacity such officer shall not be held liable for any costs, including attorney’s fees, unless such action was clearly in excess of such officer’s jurisdiction.” 42 U.S.C. § 1988.The Eleventh Amendment does not bar an award of fees when prospective relief is ordered against a state governmental entity via an action against a state official in her official capacity. Hutto v. Finney 437 U.S. 678 (1978). On the other hand, the state is not responsible for fees following a successful Section 1983 action against the officer in her personal capacity. Kentucky v. Graham, 473 U.S. 159, 168 (1985) (“Section 1988 does not guarantee that lawyers will recover fees anytime their clients sue a government official in his personal capacity, with the governmental entity as ultimate insurer. Instead, fee liability runs with merits liability; if federal law does not make the government substantively liable on a respondeat superior basis, the government similarly is not liable for fees on that basis under § 1988.”).
  3. In Texas Teachers Assn. v. Garland School Dist., 489 U.S. 782 (1988), the Court set forth the general standard defining when a party would be deemed to be “prevailing” for purposes of Section 1988. Rejecting the court of appeals’ formulation that plaintiff must succeed on the “central issue” in the litigation to be eligible for an award of attorney’s fees, the Court prescribed the following test:

    We think the language of Nadeau v. Helgemoe, quoted in our opinion in Hensley, adequately captures the inquiry which should be made in determining whether a civil rights plaintiff is a prevailing party within the meaning of § 1988. If the plaintiff has succeeded on “any significant issue in litigation which achieve[d] some of the benefit the parties sought in bringing suit,” the plaintiff has crossed the threshold to a fee award of some kind. The touchstone of the prevailing party inquiry must be the material alteration of the legal relationship of the parties in a manner which Congress sought to promote in the fee statute.

    Texas Teachers Assn., 489 U.S. at 791-92.

    1. A party may recover fees where relief has been obtained through settlement or a consent decree, even absent a formal judicial declaration that a government official violated plaintiff’s federally guaranteed rights. Maher v. Gagne, 448 U.S. 122, 129 (1980). On the other hand, the party seeking fees must obtain some relief on the merits of a claim to recover fees. No fees may be awarded where the plaintiff merely secures appellate reversal of directed verdicts entered in favor of the defense and the case is remanded for a new trial. Hanrahan v. Hampton, 446 U.S. 754 (1980) (per curiam). In addition, plaintiff is not a prevailing party where the court finds that a prisoner has suffered a deprivation of constitutional rights but a) exonerates defendants from liability for damages because of qualified immunity, and b) declines to order injunctive and declaratory relief because the plaintiff’s release from prison rendered the claim for equitable relief moot. Hewitt v. Helms, 482 U.S. 755 (1987). See also Rhodes v. Stewart, 488 U.S. 1, 3 (1988) (per curiam) (Modification of prison policies effected by declaratory judgment “could not in any way have benefitted either plaintiff, one of whom was dead and the other released.”).
    2. In Farrar v. Hobby, 506 U.S. 103 (1992), plaintiff sued under Section 1983 for $17 million dollars in money damages. The jury found that defendant Hobby had deprived Farrar of a constitutional right but that Hobby’s conduct was not a proximate cause of any damages. After the district court entered a judgement against Hobby for nominal damages, it awarded him $280,000 in attorney’s fees. The court of appeals reversed the fee award, holding that Farrar was not a prevailing party under Section 1988.The Supreme Court held that Farrar satisfied the prevailing party” requirement of Section 1988:

      [T]o qualify as a prevailing party, a civil rights plaintiff must obtain at least some of the relief on the merits of his claim. The plaintiff must obtain an enforceable judgment against the defendant from whom fees are sought … or comparable relief through a consent decree or settlement…. Only under these circumstances can civil rights litigation effect “the material alteration of the legal relationship of the parties” and thereby transform the plaintiff into a prevailing party.

      * * * * *

      We … hold that a plaintiff who wins nominal damages is a prevailing party under § 1988…. A judgment for damages in any amount, whether compensatory or nominal, modifies the defendant’s behavior for the plaintiff’s benefit by forcing the defendant to pay an amount of money he otherwise would not pay.

      Farrar, 506 U.S. at 111-13.  The Court’s analysis in Farrar generated a split in the circuits over the viability of the “catalyst test,” which granted prevailing party status to plaintiffs “if its “‘ends are accomplished as the result of the litigation even without formal judicial recognition,’” there is a “‘causal connection’” between the plaintiff’s lawsuit and the defendant’s actions providing relief to the plaintiff, and the defendant’s actions were “‘required by law.’” Morris v. City of West Palm Beach, 194 F.3d 1203 (11th Cir. 1999). Compare S-1 & S-2 v. State Board of Education, 21 F.3d 49 (4th Cir. 1994) (en banc) (Farrar precludes catalyst theory) with Morris, 21 F.3d at 1206-07 and cases cited at 1206 n.5 (Farrar does not bar the catalyst test).

  4. The Supreme Court set forth the general approach to calculation of the fee award in Hensley v. Eckerhart, 461 U.S. 424, 433-34 (1983):

    The most useful starting point for determining the amount of a reasonable fee is the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate. This calculation provides an objective basis on which to make an initial estimate of the value of a lawyer’s services. The party seeking an award of fees should submit evidence supporting the the hours worked and rates claimed. Where documentation of hours is inadequate, the district court may reduce the award accordingly.

    The district court also should exclude from this initial fee calculation hours that were not “reasonably expended.” … Counsel for the prevailing party should make a good-faith effort to exclude from a fee request hours that are excessive, redundant, or otherwise unnecessary, just as a lawyer in private practice ethically is obligated to exclude such hours from his fee submission.

    The reasonable hourly rate is to be determined by prevailing market rates in the community and is not to be reduced when plaintiff was represented by a non-profit legal services organization. Blum v. Stenson, 465 U.S. 886, 892-96 (1984). Nor does a contingent fee agreement cap the fees recoverable under Section 1988. Blanchard v. Bergeron, 489 U.S. 87 (1989).

    The Hensley Court also described how the fee award should be assessed where the plaintiff prevails on some but not all of the claims:

    In some cases a plaintiff may present in one lawsuit distinctly different claims for relief that are based on different facts and legal theories. In such a suit, even where the claims are brought against the same defendants … counsel’s work on one claim will be unrelated to his work on another claim…. The congressional intent to limit awards to prevailing parties requires that these unrelated claims be treated as if they had been raised in separate lawsuits, and therefore no fee may be awarded for services on the unsuccessful claim.

    It may well be that cases involving such unrelated claims are unlikely to arise with great frequency. Many civil rights cases will present only a single claim. In other cases the plaintiff’s claims for relief will involve a common core of facts or will be based on related legal theories. Much of counsel’s time will be devoted generally to the litigation as a whole, making it difficult to divide the hours expended on a claim-by-claim basis. Such a lawsuit cannot be viewed as a series of discrete claims. Instead the district court should focus on the significance of the overall relief obtained by the plaintiff in relation to the hours reasonably expended on the litigation.

    Where a plaintiff has obtained excellent results, his attorney should recover a fully compensatory fee. Normally this will encompass all hours reasonably expended on the litigation In these circumstances the fee award should not be reduced simply because the plaintiff failed to prevail on every contention raised in the lawsuit….

    If, on the other hand, a plaintiff has achieved only partial or limited success, the product of hours reasonably expended on the litigation as a whole times a reasonable hourly rate may be an excessive amount. This will be true even where the plaintiff’s claims were interrelated, nonfrivolous, and raised in good faith. [T]he most critical factor is the degree of success obtained.

    There is no precise rule or formula for making these determinations. The district court may attempt to identify specific hours that should be eliminated, or it may simply reduce the award to account for the limited success.

    Hensley, 461 U.S. at 434-36.

  5. In City of Riverside v. Rivera, 477 U.S. 561 (1986), plaintiffs recovered $13,300 in damages for constitutional violations after city police officers, acting without a warrant or sufficient cause, broke up a party using tear gas and excessive physical force. The defendants appealed from the lower courts’ award of attorney’s fees totaling $245,456.25. The Supreme Court affirmed the fee award, rejecting defendants’ argument that attorney’s fees must be proportionate to the amount of damages recovered:

    As an initial matter, we reject the notion that a civil action for damages constitutes nothing more than a private tort suit benefitting only the individual plaintiffs whose rights were violated. Unlike most private tort litigants, a civil rights plaintiff seeks to vindicate important civil and constitutional rights that cannot be valued solely in monetary terms. See Carey v. Piphus, 435 U.S. 247, 266 (1978). Regardless of the form of relief he actually obtains, a successful civil rights plaintiff often secures important social benefits that are not reflected in nominal or relatively small damage awards.

    * * * * *

    A rule that limits attorney’s fees in civil rights cases to a proportion of the damages awarded would seriously undermine Congress’ purpose in enacting § 1988. Congress enacted § 1988 specifically because it found that the private market for legal services failed to provide many victims of civil rights violations with effective access to the judicial process…. These victims ordinarily cannot afford to purchase legal services at the rate set by the private market. Moreover, the contingent fee arrangements that make legal services available to many victims of personal injuries would often not encourage lawyers to accept civil rights cases, which frequently involve substantial expenditures of time and effort but produce only small monetary recoveries.

    * * * * *

    A rule of proportionality would make it difficult, if not impossible, for individuals with meritorious civil rights claims but relatively small potential damages to obtain redress from the courts. This is totally inconsistent with Congress’ purpose in enacting § 1988. Congress recognized that private- sector fee arrangements were inadequate to ensure sufficiently vigorous enforcement of civil rights. In order to ensure that lawyers would be willing to represent persons with legitimate civil rights grievances, Congress determined that it would be necessary to compensate lawyers for all time reasonable expended on a case.

    City of Riverside, 477 U.S. at 574-78.

  6. While holding that a plaintiff who recovers nominal damages is a prevailing party under Section 1988, the Court, in a 5-4 opinion in Farrar v. Hobby, 506 U.S. 103 (1992), affirmed the denial of attorney’s fees on a separate ground:

    Although the “technical” nature of a nominal damages award . . . does not affect the prevailing party inquiry, it does bear on the propriety of fees awarded under § 1988. Once the civil rights litigation materially alters the legal relationship between the parties, “the degree of the plaintiff’s overall success goes to the reasonableness” of a fee award “Where recovery of private damages is the purpose of civil rights litigation, a district court, in fixing fees, is obligated to give primary consideration to the amount of damages awarded as compared to the amount sought.”

    * * * * *

    In some circumstances, even a plaintiff who formally “prevails” under § 1988 should receive no attorney’s fees at all. A plaintiff who seeks compensatory damages but receives no more than nominal damages is often such a prevailing party…. When a plaintiff recovers only nominal damages because of his failure to prove an essential element of his claim for monetary relief the only reasonable fee is usually no fee at all.

    Farrar, 506 U.S. at 114-15. Justice O’Connor, one of the five votes supporting the majority, wrote a concurring opinion in which she endorsed the following approach:

    In the context of this litigation, the technical or de minimis nature of Joseph Farrar’s victory is readily apparent: He asked for a bundle and got a pittance…. That is not to say that all nominal damage awards are de minimis. Nominal relief does not necessarily a nominal victory make…. But a substantial difference between the judgment recovered and the recovery sought suggests that the victory is in fact purely technical.

    * * * * *

    The difference between the amount recovered and the damages sought is not the only consideration. [T]he courts also must look to other factors. One is the significance of the legal issue on which the plaintiff claims to have prevailed. Respondent was just one of six defendants and the only one not found to have engaged in a conspiracy. If recovering one dollar from the least culpable defendant and nothing from the rest legitimately can be labeled a victory—and I doubt that it can—surely it is a hollow one….

    Given that Joseph Farrar got some of what he wanted his success might be considered material if t accomplished some public goal Section 1988 is a tool that ensures the vindication of important rights, even when large sums of money are not at stake, by making attorney’s fees available under a private attorney general theory. Yet one searches these facts in vain for the public purpose this litigation might have served.

    Farrar, 506 U.S. at 120-22 (O’Connor, J. concurring). Does Farrar bar an award of attorney’s fees in every Section 1983 case where plaintiff recovers only nominal damages? See Brandau v. State of Kansas, 168 F.3d 1179, 1181-83 (10th Cir. 1999); LeBlanc-Sternberg v. Fletcher, 143 F.3d 748, 758-63 (2d Cir. 1998). What strategies may plaintiff’s counsel adopt to maximize the chances of recovering attorney’s fees if the jury awards nominal damages?

  7. In the Prison Litigation Reform Act of 1995, Congress significantly limited the fees that may be awarded to attorneys who file Section 1983 actions on behalf of prisoners. 42 U.S.C. § 1997e(d). See Collins v. Montgomery Cty. Bd. Of Prison Inspectors, 176 F.3d 681 (3rd Cir. 1999) (en banc) (equally divided court affirming lower court decision that limitation of fees to 150% of judgment does not violate equal protection).
  8. The cost of hiring expert witnesses is not recoverable under Section 1988. West Virginia Univ. Hospitals, Inc. v. Casey, 499 U.S. 83 (1991) (disallowing reimbursement for fees paid to experts in excess of $100,000). Instead, as part of the costs taxed pursuant to 28 U.S.C. § 1920, plaintiff may recover only the statutory witness fee authorized by 28 U.S.C. § 1821(b). “A witness shall be paid an attendance fee of $40 per day for each day’s attendance. A witness shall also be paid the attendance fee for the time occupied in going to and returning from the place of attendance ”

EVANS v. JEFF D., 475 U.S. 717 (1986).

Justice Stevens delivered the opinion of the Court.

[1]The Civil Rights Attorney’s Fees Awards Act of 1976 (Fees Act) provides that “the court, in its discretion, may allow the prevailing party … a reasonable attorney’s fee” in enumerated civil rights actions. 90 Stat. 2641, 42 U.S.C. § 1988. In Maher v. Gagne, 448 U.S. 122 (1980), we held that fees may be assessed against state officials after a case has been settled by the entry of a consent decree. In this case, we consider the question whether attorney’s fees must be assessed when the case has been settled by a consent decree granting prospective relief to the plaintiff class but providing that the defendants shall not pay any part of the prevailing party’s fees or costs. We hold that the District Court has the power, in its sound discretion, to refuse to award fees.


[2]The petitioners are the Governor and other public officials of the State of Idaho responsible for the education and treatment of children who suffer from emotional and mental handicaps. Respondents are a class of such children who have been or will be placed in petitioners’ care.

[3]On August 4, 1980, respondents commenced this action by filing a complaint against petitioners in the United States District Court for the District of Idaho. The factual allegations in the complaint described deficiencies in both the educational programs and the health care services provided respondents. These deficiencies allegedly violated the United States Constitution, the Idaho Constitution, four federal statutes, and certain provisions of the Idaho Code. The complaint prayed for injunctive relief and for an award of costs and attorney’s fees, but it did not seek damages.

[4]On the day the complaint was filed, the District Court entered two orders, one granting the respondents leave to proceed in forma pauperis, and a second appointing Charles Johnson as their next friend for the sole purpose of instituting and prosecuting the action. At that time Johnson was employed by the Idaho Legal Aid Society, Inc., a private, nonprofit corporation that provides free legal services to qualified low-income persons. Because the Idaho Legal Aid Society is prohibited from representing clients who are capable of paying their own fees, it made no agreement requiring any of the respondents to pay for the costs of litigation or the legal services it provided through Johnson. Moreover, the special character of both the class and its attorney-client relationship with Johnson explains why it did not enter into any agreement covering the various contingencies that might arise during the course of settlement negotiations of a class action of this kind.

* * * * *

[5]In March 1983, one week before trial, petitioners presented respondents with a new settlement proposal. As respondents themselves characterize it, the proposal “offered virtually all of the injunctive relief [they] had sought in their complaint.” Brief for Respondents 5. See App. 89. The Court of Appeals agreed with this characterization, and further noted that the proposed relief was “more than the district court in earlier hearings had indicated it was willing to grant.” 743 F.2d 648, 650 (CA9 1984). As was true of the earlier partial settlement, however, petitioners’ offer included a provision for a waiver by respondents of any claim to fees or costs. Originally, this waiver was unacceptable to the Idaho Legal Aid Society, which had instructed Johnson to reject any settlement offer conditioned upon a waiver of fees, but Johnson ultimately determined that his ethical obligation to his clients mandated acceptance of the proposal. The parties conditioned the waiver on approval by the District Court.

[6]After the stipulation was signed, Johnson filed a written motion requesting the District Court to approve the settlement “except for the provision on costs and attorney’s fees,” and to allow respondents to present a bill of costs and fees for consideration by the court. App. 87. At the oral argument on that motion, Johnson contended that petitioners’ offer had exploited his ethical duty to his clients—that he was “forced,” by an offer giving his clients “the best result [they] could have gotten in this court or any other court,” to waive his attorney’s fees. The District Court, however, evaluated the waiver in the context of the entire settlement and rejected the ethical underpinnings of Johnson’s argument. Explaining that although petitioners were “not willing to concede that they were obligated to [make the changes in their practices required by the stipulation], … they were willing to do them as long as their costs were outlined and they didn’t face additional costs,” it concluded that “it doesn’t violate any ethical considerations for an attorney to give up his attorney fees in the interest of getting a better bargain for his [clients].” Id. at 93. Accordingly, the District Court approved the settlement and denied the motion to submit a costs bill.

[7]When respondents appealed from the order denying attorney’s fees and costs, petitioners filed a motion requesting the District Court to suspend or stay their obligation to comply with the substantive terms of the settlement. Because the District Court regarded the fee waiver as a material term of the complete settlement, it granted the motion. The Court of Appeals, however, granted two emergency motions for stays requiring enforcement of the substantive terms of the consent decree pending the appeal. More dramatically, after ordering preliminary relief, it invalidated the fee waiver and left standing the remainder of the settlement; it then instructed the District Court to “make its own determination of the fees that are reasonable” and remanded for that limited purpose. 743 F.2d at 652.

[8]In explaining its holding, the Court of Appeals emphasized that Rule 23(e) of the Federal Rules of Civil Procedure gives the court the power to approve the terms of all settlements of class actions, and that the strong federal policy embodied in the Fees Act normally requires an award of fees to prevailing plaintiffs in civil rights actions, including those who have prevailed through settlement. The court added that “[when] attorney’s fees are negotiated as part of a class action settlement, a conflict frequently exists between the class lawyers’ interest in compensation and the class members’ interest in relief.” 743 F.2d at 651-652. “To avoid this conflict,” the Court of Appeals relied on Circuit precedent which had “disapproved simultaneous negotiation of settlements and attorney’s fees” absent a showing of “unusual circumstances.” Id., at 652. In this case, the Court of Appeals found no such “unusual circumstances” and therefore held that an agreement on fees “should not have been a part of the settlement of the claims of the class.” Ibid.

* * * * *


[9]The disagreement between the parties and amici as to what exactly is at issue in this case makes it appropriate to put certain aspects of the case to one side in order to state precisely the question that the case does present.

[10]To begin with, the Court of Appeals’ decision rested on an erroneous view of the District Court’s power to approve settlements in class actions. Rule 23(e) wisely requires court approval of the terms of any settlement of a class action, but the power to approve or reject a settlement negotiated by the parties before trial does not authorize the court to require the parties to accept a settlement to which they have not agreed.

* * * * *

[11]The question we must decide, therefore, is whether the District Court had a duty to reject the proposed settlement because it included a waiver of statutorily authorized attorney’s fees.

[12]That duty, whether it takes the form of a general prophylactic rule or arises out of the special circumstances of this case, derives ultimately from the Fees Act rather than from the strictures of professional ethics. Although respondents contend that Johnson, as counsel for the class, was faced with an “ethical dilemma” when petitioners offered him relief greater than that which he could reasonably have expected to obtain for his clients at trial (if only he would stipulate to a waiver of the statutory fee award), and although we recognize Johnson’s conflicting interests between pursuing relief for the class and a fee for the Idaho Legal Aid Society, we do not believe that the “dilemma” was an “ethical” one in the sense that Johnson had to choose between conflicting duties under the prevailing norms of professional conduct. Plainly, Johnson had no ethical obligation to seek a statutory fee award. His ethical duty was to serve his clients loyally and competently. Since the proposal to settle the merits was more favorable than the probable outcome of the trial, Johnson’s decision to recommend acceptance was consistent with the highest standards of our profession. The District Court, therefore, correctly concluded that approval of the settlement involved no breach of ethics in this case.

[13]The defect, if any, in the negotiated fee waiver must be traced not to the rules of ethics but to the Fees Act. Following this tack, respondents argue that the statute must be construed to forbid a fee waiver that is the product of “coercion.” They submit that a “coercive waiver” results when the defendant in a civil rights action (1) offers a settlement on the merits of equal or greater value than that which plaintiffs could reasonably expect to achieve at trial but (2) conditions the offer on a waiver of plaintiffs’ statutory eligibility for attorney’s fees. Such an offer, they claim, exploits the ethical obligation of plaintiffs’ counsel to recommend settlement in order to avoid defendant’s statutory liability for its opponents’ fees and costs.

[14]The question this case presents, then, is whether the Fees Act requires a district court to disapprove a stipulation seeking to settle a civil rights class action under Rule 23 when the offered relief equals or exceeds the probable outcome at trial but is expressly conditioned on waiver of statutory eligibility for attorney’s fees. For reasons set out below, we are not persuaded that Congress has commanded that all such settlements must be rejected by the District Court. Moreover, on the facts of record in this case, we are satisfied that the District Court did not abuse its discretion by approving the fee waiver.


[15]The text of the Fees Act provides no support for the proposition that Congress intended to ban all fee waivers offered in connection with substantial relief on the merits. On the contrary, the language of the Act, as well as its legislative history, indicates that Congress bestowed on the “prevailing party” (generally plaintiffs) a statutory eligibility for a discretionary award of attorney’s fees in specified civil rights actions. It did not prevent the party from waiving this eligibility anymore than it legislated against assignment of this right to an attorney, such as effectively occurred here. Instead, Congress enacted the fee-shifting provision as “an integral part of the remedies necessary to obtain” compliance with civil rights laws, S. Rep. No. 94-1011, p. 5 (1976), to further the same general purpose—promotion of respect for civil rights—that led it to provide damages and injunctive relief. The statute and its legislative history nowhere suggest that Congress intended to forbid all waivers of attorney’s fees—even those insisted upon by a civil rights plaintiff in exchange for some other relief to which he is indisputably not entitled—anymore than it intended to bar a concession on damages to secure broader injunctive relief. Thus, while it is undoubtedly true that Congress expected fee shifting to attract competent counsel to represent citizens deprived of their civil rights, it neither bestowed fee awards upon attorneys nor rendered them nonwaivable or nonnegotiable; instead, it added them to the arsenal of remedies available to combat violations of civil rights, a goal not invariably inconsistent with conditioning settlement on the merits on a waiver of statutory attorney’s fees.

[16]In fact, we believe that a general proscription against negotiated waiver of attorney’s fees in exchange for a settlement on the merits would itself impede vindication of civil rights, at least in some cases, by reducing the attractiveness of settlement.

* * * * *

[17]Most defendants are unlikely to settle unless the cost of the predicted judgment, discounted by its probability, plus the transaction costs of further litigation, are greater than the cost of the settlement package. If fee waivers cannot be negotiated, the settlement package must either contain an attorney’s fee component of potentially large and typically uncertain magnitude, or else the parties must agree to have the fee fixed by the court. Although either of these alternatives may well be acceptable in many cases, there surely is a significant number in which neither alternative will be as satisfactory as a decision to try the entire case.

[18]The adverse impact of removing attorney’s fees and costs from bargaining might be tolerable if the uncertainty introduced into settlement negotiations were small. But it is not. The defendants’ potential liability for fees in this kind of litigation can be as significant as, and sometimes even more significant than, their potential liability on the merits.

* * * * *

[19]The unpredictability of attorney’s fees may be just as important as their magnitude when a defendant is striving to fix its liability. Unlike a determination of costs, which ordinarily involve smaller outlays and are more susceptible of calculation, see Marek v. Chesny, 473 U.S. at 7, “[there] is no precise rule or formula” for determining attorney’s fees, Hensley v. Eckerhart, 461 U.S. 424, 436 (1983). Among other considerations, the district court must determine what hours were reasonably expended on what claims, whether that expenditure was reasonable in light of the success obtained, see id. at 436, 440, and what is an appropriate hourly rate for the services rendered. Some District Courts have also considered whether a “multiplier” or other adjustment is appropriate. The consequence of this succession of necessarily judgmental decisions for the ultimate fee award is inescapable: a defendant’s liability for his opponent’s attorney’s fees in a civil rights action cannot be fixed with a sufficient degree of confidence to make defendants indifferent to their exclusion from negotiation. It is therefore not implausible to anticipate that parties to a significant number of civil rights cases will refuse to settle if liability for attorney’s fees remains open, thereby forcing more cases to trial, unnecessarily burdening the judicial system, and disserving civil rights litigants. Respondents’ own waiver of attorney’s fees and costs to obtain settlement of their educational claims is eloquent testimony to the utility of fee waivers in vindicating civil rights claims. We conclude, therefore, that it is not necessary to construe the Fees Act as embodying a general rule prohibiting settlements conditioned on the waiver of fees in order to be faithful to the purposes of that Act.


[20]The question remains whether the District Court abused its discretion in this case by approving a settlement which included a complete fee waiver.

* * * * *

[21]The Court of Appeals, respondents, and various amici supporting their position, however, suggest that the court’s authority to pass on settlements, typically invoked to ensure fair treatment of class members, must be exercised in accordance with the Fees Act to promote the availability of attorneys in civil rights cases. Specifically, respondents assert that the State of Idaho could not pass a valid statute precluding the payment of attorney’s fees in settlements of civil rights cases to which the Fees Act applies. See Brief for Respondents 24, n.22. From this they reason that the Fees Act must equally preclude the adoption of a uniform state-wide policy that serves the same end, and accordingly contend that a consistent practice of insisting on a fee waiver as a condition of settlement in civil rights litigation is in conflict with the federal statute authorizing fees for prevailing parties, including those who prevail by way of settlement.[1]

Remarkably, there seems little disagreement on these points. Petitioners and the amici who support them never suggest that the district court is obligated to place its stamp of approval on every settlement in which the plaintiffs’ attorneys have agreed to a fee waiver. The Solicitor General, for example, has suggested that a fee waiver need not be approved when the defendant had “no realistic defense on the merits,” Brief for United States as Amicus Curiae Supporting Reversal 23, n.9; see id. at 26-27,[2]

or if the waiver was part of a “vindictive effort … to teach counsel that they had better not bring such cases,” Tr. of Oral Arg. 22.

[22]We find it unnecessary to evaluate this argument, however, because the record in this case does not indicate that Idaho has adopted such a statute, policy, or practice. Nor does the record support the narrower proposition that petitioners’ request to waive fees was a vindictive effort to deter attorneys from representing plaintiffs in civil rights suits against Idaho. It is true that a fee waiver was requested and obtained as a part of the early settlement of the education claims, but we do not understand respondents to be challenging that waiver, see Tr. of Oral Arg. 31-32, and they have not offered to prove that petitioners’ tactics in this case merely implemented a routine state policy designed to frustrate the objectives of the Fees Act. Our own examination of the record reveals no such policy.

[23]In light of the record, respondents must—to sustain the judgment in their favor—confront the District Court’s finding that the extensive structural relief they obtained constituted an adequate quid pro quo for their waiver of attorney’s fees.[3]

The Court of Appeals did not overturn this finding. Indeed, even that court did not suggest that the option of rejecting the entire settlement and requiring the parties either to try the case or to attempt to negotiate a different settlement would have served the interests of justice. Only by making the unsupported assumption that the respondent class was entitled to retain the favorable portions of the settlement while rejecting the fee waiver could the Court of Appeals conclude that the District Court had acted unwisely.

[24]What the outcome of this settlement illustrates is that the Fees Act has given the victims of civil rights violations a powerful weapon that improves their ability to employ counsel, to obtain access to the courts, and thereafter to vindicate their rights by means of settlement or trial. For aught that appears, it was the “coercive” effect of respondents’ statutory right to seek a fee award that motivated petitioners’ exceptionally generous offer. Whether this weapon might be even more powerful if fee waivers were prohibited in cases like this is another question,[4]

but it is in any event a question that Congress is best equipped to answer. Thus far, the Legislature has not commanded that fees be paid whenever a case is settled. Unless it issues such a command, we shall rely primarily on the sound discretion of the district courts to appraise the reasonableness of particular class-action settlements on case-by-case basis, in the light of all the relevant circumstances.[5]

In this case, the District Court did not abuse its discretion in upholding a fee waiver which secured broad injunctive relief, relief greater than that which plaintiffs could reasonably have expected to achieve at trial.[6]

The judgment of the Court of Appeals is reversed.

It is so ordered.

Justice Brennan, with whom Justice Marshall and Justice Blackmun join, dissenting.

[25]Ultimately, enforcement of the laws is what really counts. It was with this in mind that Congress enacted the Civil Rights Attorney’s Fees Awards Act of 1976, 42 U.S.C. § 1988 (Act or Fees Act). Congress authorized fee shifting to improve enforcement of civil rights legislation by making it easier for victims of civil rights violations to find lawyers willing to take their cases. Because today’s decision will make it more difficult for civil rights plaintiffs to obtain legal assistance, a result plainly contrary to Congress’ purpose, I dissent.


[26]The Court begins its analysis by emphasizing that neither the language nor the legislative history of the Fees Act supports “the proposition that Congress intended to ban all fee waivers offered in connection with substantial relief on the merits.” Ante at 730. I agree. There is no evidence that Congress gave the question of fee waivers any thought at all. However, the Court mistakenly assumes that this omission somehow supports the conclusion that fee waivers are permissible. On the contrary, that Congress did not specifically consider the issue of fee waivers tells us absolutely nothing about whether such waivers ought to be permitted. It is black letter law that “[in] the absence of specific evidence of Congressional intent, it becomes necessary to resort to a broader consideration of the legislative policy behind [the] provision “

* * * * *

[27]Accordingly, the first and most important question to be asked is what Congress’ purpose was in enacting the Fees Act. We must then determine whether conditional fee waivers are consistent with this purpose.


[28]The Court asserts that Congress authorized fee awards “to further the same general purpose—promotion of respect for civil rights—that led it to provide damages and injunctive relief.” Ante at 731. The attorney’s fee made available by the Act, we are told, is simply an addition to “the arsenal of remedies available to combat violations of civil rights.” Ante at 732.

[29]Obviously, the Fees Act is intended to “promote respect for civil rights.” Congress would hardly have authorized fee awards in civil rights cases to promote respect for the securities laws. But discourse at such a level of generality is deceptive. The question is how did Congress envision that awarding attorney’s fees would promote respect for civil rights? Without a clear understanding of the way in which Congress intended for the Fees Act to operate, we cannot even begin responsibly to go about the task of interpreting it. In theory, Congress might have awarded attorney’s fees as simply an additional form of make-whole relief, the threat of which would “promote respect for civil rights” by deterring potential civil rights violators. If this were the case, the Court’s equation of attorney’s fees with damages would not be wholly inaccurate. However, the legislative history of the Fees Act discloses that this is not the case. Rather, Congress provided fee awards to ensure that there would be lawyers available to plaintiffs who could not otherwise afford counsel, so that these plaintiffs could fulfill their role in the federal enforcement scheme as “private attorneys general,” vindicating the public interest.

[30]Before the late 1960’s, the concept of fee shifting in public interest litigation was virtually nonexistent. In Newman v. Piggie Park Enterprises, Inc., 390 U.S. 400 (1968) (per curiam), this Court was called upon to interpret the attorney’s fee provision of Title II of the then recently enacted Civil Rights Act of 1964, 42 U.S.C. § 2000a-3(b). We held that a prevailing plaintiff should ordinarily recover fees unless special circumstances rendered such an award unjust. Noting that “[when] the Civil Rights Act of 1964 was passed, it was evident that enforcement would prove difficult and that the Nation would have to rely in part upon private litigation as a means of securing broad compliance with the law,” we recognized that “[a] Title II suit is thus private in form only.” Newman, 390 U.S. at 401. If a plaintiff obtains relief, he “does so not for himself alone but also as a ‘private attorney general,’ vindicating a policy that Congress considered of the highest priority.” Id. at 402 (footnote omitted). We recognized further that the right to recover attorney’s fees was conferred by Congress to ensure that this private public-enforcement mechanism would operate effectively:

“If successful plaintiffs were routinely forced to bear their own attorneys’ fees, few aggrieved parties would be in a position to advance the public interest by invoking the injunctive powers of the federal courts. Congress therefore enacted the provision for counsel fees—not simply to penalize litigants who deliberately advance arguments they know to be untenable but, more broadly, to encourage individuals injured by racial discrimination to seek judicial relief under Title II.” Ibid. (footnote omitted).

[31]Newman interpreted the fee provision of Title II as intended to bridge the gap between the desire of an individual who has been deprived of a federal right to see that right vindicated and the financial ability of that individual to do so. More importantly, Newman recognized that Congress did not erect this bridge solely, or even primarily, to confer a benefit on such aggrieved individuals. Rather, Congress sought to capitalize on the happy coincidence that encouraging private actions would, in the long run, provide effective public enforcement of Title II. By ensuring that lawyers would be willing to take Title II cases, Congress made the threat of a lawsuit for violating Title II real, thereby deterring potential violators.

[32]After Newman, lower courts—invoking their equitable powers to award attorney’s fees—adopted a similar rationale to award fees in cases brought under civil rights statutes that did not contain express provisions for attorney’s fees.

* * * * *

[33]In May 1975, this Court in Alyeska Pipeline Service Co. v. Wilderness Society, 421 U.S. 240, ruled that the equitable powers of the federal courts did not authorize fee awards on the ground that a case served the public interest. Although recognizing that “Congress has opted to rely heavily on private enforcement to implement public policy and to allow counsel fees so as to encourage private litigation,” the Court held that “congressional utilization of the private-attorney-general concept can in no sense be construed as a grant of authority to the Judiciary … to award attorneys’ fees whenever the courts deem the public policy furthered by a particular statute important enough to warrant the award.” Id. at 263. Instead, the Court ruled, only Congress could authorize awarding fees as a means of encouraging private actions in the name of public policy. Id. at 269-271.

[34]In the wake of Alyeska, Congress acted to correct “anomalous gaps” in the availability of attorney’s fees to enforce civil rights laws, S. Rep. No. 94-1011, p. 1 (1976) (hereafter S. Rep.). See H.R. Rep. No. 94-1558, p. 2 (1976) (hereafter H.R. Rep.); 122 Cong. Rec. 31472 (1976) (remarks of Sen. Kennedy). Testimony at hearings on the proposed legislation disclosed that civil rights plaintiffs, “a vast majority of [whom] cannot afford legal counsel,” H.R. Rep. 1, were suffering “very severe hardships because of the Alyeska decision,” id. at 2. The unavailability of fee shifting made it impossible for legal aid services, “already short of resources,” to bring many lawsuits, and, without much possibility of compensation, private attorneys were refusing to take civil rights cases. Id., at 3. See generally Hearings on the Effect of Legal Fees on the Adequacy of Representation before the Subcommittee on Representation of Citizen Interests of the Senate Committee on the Judiciary, 93d Cong., 1st Sess., pts. 1-4 (1973). Congress found that Alyeska had a “devastating” impact on civil rights litigation, and it concluded that the need for corrective legislation was “compelling.” H.R. Rep. 3; see also 122 Cong. Rec., supra, at 31471 (remarks of Sen. Scott), 31472 (remarks of Sen. Kennedy).

[35]Accepting this Court’s invitation, see Alyeska, supra, at 269-271, Congress passed the Fees Act in order to reestablish the Newman regime under which attorney’s fees were awarded as a means of securing enforcement of civil rights laws by ensuring that lawyers would be willing to take civil rights cases. The legislative history manifests this purpose with monotonous clarity.

* * * * *

[36][I]t was Representative Anderson, responding to a question from an opponent of the Fees Act, who summed up the reason for the legislation most effectively. He said:

“We are talking here about major civil rights laws. We have an obligation, it seems to me, as the representatives of the people, to make sure that those laws are enforced and we discharge that obligation when we make available a reasonable award of attorneys’ fees at the discretion of the court. Those of us who are interested in making sure that those laws are enforced … are simply abetting and aiding that process of law enforcement when we agree to the provisions of this bill.” Id. at 35116. See also, e.g., id. at 31471 (remarks of Sen. Scott) (“Congress should encourage citizens to go to court in private suits to vindicate its policies and protect their rights”), 35128 (remarks of Rep. Seiberling).


[37]As this review of the legislative history makes clear, then, by awarding attorney’s fees Congress sought to attract competent counsel to represent victims of civil rights violations. Congress’ primary purpose was to enable “private attorneys general” to protect the public interest by creating economic incentives for lawyers to represent them. The Court’s assertion that the Fees Act was intended to do nothing more than give individual victims of civil rights violations another remedy is thus at odds with the whole thrust of the legislation. Congress determined that the public as a whole has an interest in the vindication of the rights conferred by the civil rights statutes over and above the value of a civil rights remedy to a particular plaintiff.

[38]I have gone to great lengths to show how the Court mischaracterizes the purpose of the Fees Act because the Court’s error leads it to ask the wrong question. Having concluded that the Fees Act merely creates another remedy to vindicate the rights of individual plaintiffs, the Court asks whether negotiated waivers of statutory attorney’s fees are “invariably inconsistent” with the availability of such fees as a remedy for individual plaintiffs. Ante at 732. Not surprisingly, the Court has little difficulty knocking down this frail straw man. But the proper question is whether permitting negotiated fee waivers is consistent with Congress’ goal of attracting competent counsel. It is therefore necessary to consider the effect on this goal of allowing individual plaintiffs to negotiate fee waivers.


[39]Permitting plaintiffs to negotiate fee waivers in exchange for relief on the merits actually raises two related but distinct questions. First, is it permissible under the Fees Act to negotiate a settlement of attorney’s fees simultaneously with the merits? Second, can the “reasonable attorney’s fee” guaranteed in the Act be waived? As a matter of logic, either of these practices may be permitted without also permitting the other. For instance, one could require bifurcated settlement negotiations of merits and fees but allow plaintiffs to waive their fee claims during that phase of the negotiations. Alternatively, one could permit simultaneous negotiation of fees and merits but prohibit the plaintiff from waiving statutory fees. This latter possibility exists because there is a range of “reasonable attorney’s fees” consistent with the Fees Act in any given case. Cf. Blum v. Stenson, 465 U.S. 886 (1984); Hensley v. Eckerhart, 461 U.S. 424, 433-437 (1983); H.R. Rep. 8-9; S. Rep. 6; see generally Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 716-720 (CA5 1974) (listing relevant factors).

[40]More importantly, since simultaneous negotiation and waiver may have different effects on the congressional policy of encouraging counsel to accept civil rights cases, each practice must be analyzed independently to determine whether or not it is consistent with the Fees Act. Unfortunately, the Court overlooks the logical independence of simultaneous negotiation and waiver and assumes that there cannot be one without the other. See ante at 734-738, and n.28. As a result, the Court’s discussion conflates the different effects of these practices, and its opinion is of little use in coming to a fair resolution of this case. An independent examination leads me to conclude: (1) that plaintiffs should not be permitted to waive the “reasonable fee” provided by the Fees Act; but (2) that parties may undertake to negotiate their fee claims simultaneously with the merits so long as whatever fee the parties agree to is found by the court to be a “reasonable” one under the Fees Act.



[41]It seems obvious that allowing defendants in civil rights cases to condition settlement of the merits on a waiver of statutory attorney’s fees will diminish lawyers’ expectations of receiving fees and decrease the willingness of lawyers to accept civil rights cases. Even the Court acknowledges “the possibility that decisions by individual clients to bargain away fee awards may, in the aggregate and in the long run, diminish lawyers’ expectations of statutory fees in civil rights cases.” Ante at 741-742, n.34. The Court tells us, however, that “[comment] on this issue” is “premature at this juncture” because there is not yet supporting “documentation.” Ibid. The Court then goes on anyway to observe that “as a practical matter the likelihood of this circumstance arising is remote.” Ibid.

[42]I must say that I find the Court’s assertions somewhat difficult to understand. To be sure, the impact of conditional fee waivers on the availability of attorneys will be less severe than was the restriction on fee awards created in Alyeska. However, that experience surely provides an indication of the immediate hardship suffered by civil rights claimants whenever there is a reduction in the availability of attorney’s fee awards.[7] Moreover, numerous courts and commentators have recognized that permitting fee waivers creates disincentives for lawyers to take civil rights cases and thus makes it more difficult for civil rights plaintiffs to obtain legal assistance.

* * * * *

[43]But it does not require a sociological study to see that permitting fee waivers will make it more difficult for civil rights plaintiffs to obtain legal assistance. It requires only common sense. Assume that a civil rights defendant makes a settlement offer that includes a demand for waiver of statutory attorney’s fees. The decision whether to accept or reject the offer is the plaintiff’s alone, and the lawyer must abide by the plaintiff’s decision. See, e.g., ABA, Model Rules of Professional Conduct 1.2(a) (1984); ABA, Model Code of Professional Responsibility EC 7-7 to EC 7-9 (1982). As a formal matter, of course, the statutory fee belongs to the plaintiff, ante at 730, and n.19, and thus technically the decision to waive entails a sacrifice only by the plaintiff. As a practical matter, however, waiver affects only the lawyer. Because “a vast majority of the victims of civil rights violations” have no resources to pay attorney’s fees, H.R. Rep. 1, lawyers cannot hope to recover fees from the plaintiff and must depend entirely on the Fees Act for compensation.[8] The plaintiff thus has no real stake in the statutory fee and is unaffected by its waiver. See Lipscomb v. Wise, 643 F.2d 319, 320 (CA5 1981) (per curiam). Consequently, plaintiffs will readily agree to waive fees if this will help them to obtain other relief they desire. As summed up by the Legal Ethics Committee of the District of Columbia Bar:

“Defense counsel … are in a uniquely favorable position when they condition settlement on the waiver of the statutory fee: They make a demand for a benefit that the plaintiff’s lawyer cannot resist as a matter of ethics and one in which the plaintiff has no interest and therefore will not resist.” Op. No. 147, reprinted in 113 Daily Washington Reporter, supra n.8, at 394.

[44]Of course, from the lawyer’s standpoint, things could scarcely have turned out worse. He or she invested considerable time and effort in the case, won, and has exactly nothing to show for it. Is the Court really serious in suggesting that it takes a study to prove that this lawyer will be reluctant when, the following week, another civil rights plaintiff enters his office and asks for representation? Does it truly require that somebody conduct a test to see that legal aid services, having invested scarce resources on a case, will feel the pinch when they do not recover a statutory fee?

[45]And, of course, once fee waivers are permitted, defendants will seek them as a matter of course, since this is a logical way to minimize liability. Indeed, defense counsel would be remiss not to demand that the plaintiff waive statutory attorney’s fees. A lawyer who proposes to have his client pay more than is necessary to end litigation has failed to fulfill his fundamental duty zealously to represent the best interests of his client. Because waiver of fees does not affect the plaintiff, a settlement offer is not made less attractive to the plaintiff if it includes a demand that statutory fees be waived. Thus, in the future, we must expect settlement offers routinely to contain demands for waivers of statutory fees.[9]

[46]The cumulative effect this practice will have on the civil rights bar is evident. It does not denigrate the high ideals that motivate many civil rights practitioners to recognize that lawyers are in the business of practicing law, and that, like other business people, they are and must be concerned with earning a living. The conclusion that permitting fee waivers will seriously impair the ability of civil rights plaintiffs to obtain legal assistance is embarrassingly obvious.

[47]Because making it more difficult for civil rights plaintiffs to obtain legal assistance is precisely the opposite of what Congress sought to achieve by enacting the Fees Act, fee waivers should be prohibited. We have on numerous prior occasions held that “a statutory right conferred on a private party, but affecting the public interest, may not be waived or released if such waiver or release contravenes the statutory policy.”

* * * * *

[48]This is simply straightforward application of the well-established principle that an agreement which is contrary to public policy is void and unenforceable.

* * * * *

[49]This all seems so obvious that it is puzzling that the Court reaches a different result. The Court’s rationale is that, unless fee waivers are permitted, “parties to a significant number of civil rights cases will refuse to settle….” Ante, at 736. This is a wholly inadequate justification for the Court’s result.

[50]First, the effect of prohibiting fee waivers on settlement offers is just not an important concern in the context of the Fees Act. I agree with the Court that encouraging settlements is desirable policy. But it is judicially created policy, applicable to litigation of any kind and having no special force in the context of civil rights cases. The congressional policy underlying the Fees Act is, as I have argued throughout, to create incentives for lawyers to devote time to civil rights cases by making it economically feasible for them to do so. Supra at 745-753. As explained above, permitting fee waivers significantly undercuts this policy. Thus, even if prohibiting fee waivers does discourage some settlements, a judicial policy favoring settlement cannot possibly take precedence over this express congressional policy. We must implement Congress’ agenda, not our own.

[51]In an attempt to justify its decision to elevate settlement concerns, the Court argues that settlement “provides benefits for civil rights plaintiffs as well as defendants and is consistent with the purposes of the Fees Act” because “‘[some] plaintiffs will receive compensation in settlement where, on trial, they might not have recovered, or would have recovered less than what was offered.'” Ante at 732-733 (quoting Marek v. Chesny, 473 U.S. 1, 10 (1985)); see also ante at 731 (legislative history does not show that Congress intended to bar “even [waivers] insisted upon by a civil rights plaintiff in exchange for some other relief to which he is indisputably not entitled…”) (footnote omitted).

[52]As previously noted, by framing the purpose of the Fees Act in very general terms, the Court merely obscures the proper focus of discussion. The Fees Act was designed to help civil rights plaintiffs in a particular way—by ensuring that there will be lawyers willing to represent them. The fact that fee waivers may produce some settlement offers that are beneficial to a few individual plaintiffs is hardly “consistent with the purposes of the Fees Act,” ante at 733, if permitting fee waivers fundamentally undermines what Congress sought to achieve. Each individual plaintiff who waives his right to statutory fees in order to obtain additional relief for himself makes it that much more difficult for the next victim of a civil rights violation to find a lawyer willing or able to bring his case. As obtaining legal assistance becomes more difficult, the “benefit” the Court so magnanimously preserves for civil rights plaintiffs becomes available to fewer and fewer individuals, exactly the opposite result from that intended by Congress.

[53]Moreover, I find particularly unpersuasive the Court’s apparent belief that Congress enacted the Fees Act to help plaintiffs coerce relief to which they are “indisputably not entitled.” See ante at 731, 732. It may be that, in particular cases, some defendants’ fears of incurring liability for plaintiff’s attorney’s fees will give plaintiffs leverage to coerce relief they do not deserve. If so, this is an unfortunate cost of a statute intended to ensure that plaintiffs can obtain the relief to which they are entitled. And it certainly is not a result we must preserve at the expense of the central purpose of the Fees Act.

[54]Second, even assuming that settlement practices are relevant, the Court greatly exaggerates the effect that prohibiting fee waivers will have on defendants’ willingness to make settlement offers. This is largely due to the Court’s failure to distinguish the fee waiver issue from the issue of simultaneous negotiation of fees and merits claims. Supra at 754. The Court’s discussion mixes concerns over a defendant’s reluctance to settle because total liability remains uncertain with reluctance to settle because the cost of settling is too high. See ante at 734-737. However, it is a prohibition on simultaneous negotiation, not a prohibition on fee waivers, that makes it difficult for the defendant to ascertain his total liability at the time he agrees to settle the merits. Thus, while prohibiting fee waivers may deter settlement offers simply because requiring the defendant to pay a “reasonable attorney’s fee” increases the total cost of settlement, this is a separate issue altogether, and the Court’s numerous arguments about why defendants will not settle unless they can determine their total liability at the time of settlement, ante at 734, 735, 736, are simply beside the point. With respect to a prohibition on fee waivers (and again merely assuming that effects on settlement are relevant), the sole question to be asked is whether the increased cost of settlement packages will prevent enough settlement offers to be a dispositive factor in this case.

[55]The Court asserts, without factual support, that requiring defendants to pay statutory fee awards will prevent a “significant number” of settlements. Ante at 734-735. It is, of course, ironic that the same absence of “documentation” which makes comment on the effects of permitting fee waivers “premature at this juncture,” ante at 742, n.34, does not similarly affect the Court’s willingness to speculate about what to expect if fee waivers are prohibited. Be that as it may, I believe that the Court overstates the extent to which prohibiting fee waivers will deter defendants from making settlement offers. Because the parties can negotiate a fee (or a range of fees) that is not unduly high and condition their settlement on the court’s approval of this fee, the magnitude of a defendant’s liability for fees in the settlement context need be neither uncertain nor particularly great. Against this, the defendant must weigh the risk of a nonnegotiated fee to be fixed by the court after a trial; as the Court reminds us, fee awards in this context may be very uncertain and, potentially, of very great magnitude. See ante at 734-735, nn.23, 24. Thus, powerful incentives remain for defendants to seek settlement. Moreover, the Court’s decision last Term in Marek v. Chesny, 473 U.S. 1 (1985), provides an additional incentive for defendants to make settlement offers, namely, the opportunity to limit liability for attorney’s fees if the plaintiff refuses the offer and proceeds to trial.

[56]All of which is not to deny that prohibiting fee waivers will deter some settlements; any increase in the costs of settling will have this effect. However, by exaggerating the size and the importance of fee awards, and by ignoring the options available to the parties in settlement negotiations, the Court makes predictions that are inflated. An actual disincentive to settling exists only where three things are true: (1) the defendant feels he is likely to win if he goes to trial, in which case the plaintiff will recover no fees; (2) the plaintiff will agree to relief on the merits that is less costly to the defendant than litigating the case; and (3) adding the cost of a negotiated attorney’s fee makes it less costly for the defendant to litigate. I believe that this describes a very small class of cases—although, like the Court, I cannot “document” the assertion.


[57]I would, on the other hand, permit simultaneous negotiation of fees and merits claims, since this would not contravene the purposes of the Fees Act. Congress determined that awarding prevailing parties a “reasonable” fee would create necessary—and sufficient—incentives for attorneys to work on civil rights cases. Prohibiting plaintiffs from waiving statutory fees ensures that lawyers will receive this “reasonable” statutory fee. Thus, if fee waivers are prohibited, permitting simultaneous fees and merits negotiations will not interfere with the Act; the lawyer will still be entitled to and will still receive a reasonable attorney’s fee. Indeed, permitting simultaneous negotiations in such circumstances may even enhance the effectiveness of the Fees Act by making it easier for a lawyer to dispose of his cases more quickly. This frees up the lawyer’s time to take other cases and may enhance his reputation as an effective advocate who quickly obtains relief for clients.


[58]Although today’s decision will undoubtedly impair the effectiveness of the private enforcement scheme Congress established for civil rights legislation, I do not believe that it will bring about the total disappearance of “private attorneys general.” It is to be hoped that Congress will repair this Court’s mistake. In the meantime, other avenues of relief are available. The Court’s decision in no way limits the power of state and local bar associations to regulate the ethical conduct of lawyers. Indeed, several Bar Associations have already declared it unethical for defense counsel to seek fee waivers. See Committee on Professional Ethics of the Association of the Bar of the City of New York, Op. No. 82-80 (1985); District of Columbia Legal Ethics Committee, Op. No. 147, supra n.8, 113 Daily Washington Law Reporter, at 389. Such efforts are to be commended and, it is to be hoped, will be followed by other state and local organizations concerned with respecting the intent of Congress and with protecting civil rights.

[59]In addition, it may be that civil rights attorneys can obtain agreements from their clients not to waive attorney’s fees.[10] Such agreements simply replicate the private market for legal services (in which attorneys are not ordinarily required to contribute to their client’s recovery[11] and thus will enable civil rights practitioners to make it economically feasible—as Congress hoped—to expend time and effort litigating civil rights claims.

[60]During the floor debates over passage of the Fees Act, Senator Hugh Scott reminded the Congress in terms that might well have been addressed to the Court today that “we must bear in mind at all times that rights that cannot be enforced through the legal process are valueless; such a situation breeds cynicism about the basic fairness of our judicial system. [We] must be vigilant to insure that our legal rights are not hollow ones.” 122 Cong. Rec. 31471 (1976).

download arrowNotes on Evans v. Jeff D. – Audio and Transcript of Oral Argument

  1. See Committee on Professional and Judicial Ethics of the New York City Bar Association, Op. No. 80-94, reprinted in 36 Record of N.Y.C.B.A., 507, 510 (1981) ("The] long term effect of persistent demands for the waiver of statutory fees is to ... undermine efforts to make counsel available to those who cannot afford it"). Accord, District of Columbia Bar Legal Ethics Committee, Op. No. 147, reprinted in 113 DAILY WASH. L. REP. 389, 394 (1985). National staff counsel for the American Civil Liberties Union estimates that requests for fee waivers are made in more than half of all civil rights cases litigated. See Winter, Fee Waiver Requests Unethical: Bar Opinion, 68 A.B.A. J. 23 (1982).

  2. In this regard, consider the following comment in the Final Subcommittee Report of the Committee on Attorney's Fees of the Judicial Conference of the United States Court of Appeals for the District of Columbia Circuit:

    "Against this background, it was agreed that there were certain situations in which the refusal of defense counsel to proceed except on a package basis was improper. For instance, in a Freedom of Information Act case, where a journalist was the plaintiff and either had a reasonably good case, or had won in the district court and the government was considering appeal, it would be improper for government counsel to offer to release the documents, only if plaintiff's counsel agreed to waive all attorneys fees. That situation presents a grossly unfair choice to the plaintiff and his/her counsel, and permitting such offers to be made would seriously undermine the purpose of fee shifting provisions. Moreover, it would serve no end other than saving the government money which it would otherwise have to pay, yet any such saving is plainly at odds with the purpose for which the fee shifting statute was enacted." 13 Bar Rep., at 6.

  3. From the declarations of respondents' counsel in the lower courts, as well as those of the District Court and the Court of Appeals, all of which are quoted in Part I, supra, we understand the District Court's approval of the stipulation settling the health services claims to have rested on the determination that the provision waiving attorney's fees and costs was fair to the class—i.e., the fee waiver was exchanged for injunctive relief of equivalent value.
  4. We are cognizant of the possibility that decisions by individual clients to bargain away fee awards may, in the aggregate and in the long run, diminish lawyers' expectations of statutory fees in civil rights cases. If this occurred, the pool of lawyers willing to represent plaintiffs in such cases might shrink, constricting the "effective access to the judicial process" for persons with civil rights grievances which the Fees Act was intended to provide. H.R. Rep. No. 94-1558, p. 1 (1976). That the "tyranny of small decisions" may operate in this fashion is not to say that there is any reason or documentation to support such a concern at the present time. Comment on this issue is therefore premature at this juncture. We believe, however, that as a practical matter the likelihood of this circumstance arising is remote. See Moore v. National Assn. of Securities Dealers, Inc., 246 U.S. App. D.C. at 133, n.1, 762 F.2d, at 1112 n.1 (Wald, J., concurring in judgment).

  5. "Each negotiation, like each litigant, is unique; reasonableness can only be determined by looking at the strength of the plaintiff's case, the stage at which the settlement is effective, the substantiality of the relief obtained on the merits, and the explanations of the parties as to why they did what they did." Id. at 134, 762 F.2d, at 1113 (Wald, J., concurring in judgment).

    See also the following comment in the opinion of the Final Subcommittee Report of the Committee on Attorney's Fees of the Judicial Conference of the United States Court of Appeals for the District of Columbia Circuit:

    "[The] purpose of such settlement offers is not, in most cases, to create an attorney-client conflict, nor to punish or deter plaintiffs' attorneys from taking on fee shifting cases. Generally speaking, the reason that defendants make such offers is to limit their total exposure.

    . . . .

    "The key in these situations is whether the defendant's offer is reasonable in light of all the circumstances, including the chances of success on the merits and the risk of possible exposure in damages and attorneys fees. And in making such determinations, the legitimate interest of the fee shifting provisions must be balanced against the legitimate interest of the defendant, whether a governmental agency or private party, in making an offer which will fix liability with considerable certainty. This balancing approach applies regardless of whether the issue is phrased in terms of the right of the defendant to make a lump sum settlement offer, or the right to refuse to pay fees to the plaintiff's attorney while providing some measure of relief to the client. In both situations, the inquiry is the same and can be decided only on a case by case basis, assessing the reasonableness of the defendant's conduct." 13 Bar Report, at 6.

  6. Although the record in this case does not provide us with any information concerning the amount of money that had been expended on costs, it is appropriate to note that costs other than fees may alsob e a significant item in class-action litigation. For example, in Moore v. National Assn. of Securities Dealers, Inc., supra, the class representative's liability for costs amounted to over $30,000 at the time she decided that her best interests would be served by a settlement. 246 U.S. App. D.C. at 116-117, 762 F.2d, at 1095, 1096, and n.2 (opinion of MacKinnon, J.). The interest in recovering costs already expended by a class representative may justify a refusal to accept a settlement including only prospective relief and, conversely, the interest in avoiding the additional expenditures associated with continuing the litigation may also justify accepting an otherwise doubtful settlement.

  7. It is especially important to keep in mind the fragile nature of the civil rights bar. Even when attorney's fees are awarded, they do not approach the large sums which can be earned in ordinary commercial litigation. See Berger, Court Awarded Attorneys' Fees: What is "Reasonable"?, 126 U. PA L. REV. 281, 310-315 (1977). It is therefore cost inefficient for private practitioners to devote much time to civil rights cases. Consequently, there are very few civil rights practitioners, and most of these devote only a small part of their time to such cases. Kraus, 29 VILL. L. REV. at 633-634 (citing studies indicating that less than 1% of lawyers engage in public interest practice). Instead, civil rights plaintiffs must depend largely on legal aid organizations for assistance. These organizations, however, are short of resources and also depend heavily on statutory fees. H.R. Rep. 3; Kraus, supra, at 634; see also, Blum v. Stenson, 465 U.S. 886, 894-895 (1984).
  8. Nor can attorneys protect themselves by requiring plaintiffs to sign contingency agreements or retainers at the outset of the representation. Amici legal aid societies inform us that they are prohibited by statute, court rule, or Internal Revenue Service regulation from entering into fee agreements with their clients. Brief for NAACP Legal Defense and Educational Fund, Inc., et al. as Amici Curiae 10-11; Brief for Committee on Legal Assistance of the Association of the Bar of the City of New York as Amicus Curiae 12-13. Moreover, even if such agreements could be negotiated, the possibility of obtaining protection through contingency fee arrangements is unavailable in the very large proportion of civil rights cases which, like this case, seek only injunctive relief. In addition, the Court's misconceived doctrine of state sovereign immunity, see Atascadero State Hospital v. Scanlon, 473 U.S. 234, 247 (1985) (Brennan, J., dissenting), precludes damages suits against governmental bodies, the most frequent civil rights defendants. Finally, even when a suit is for damages, many civil rights actions concern amounts that are too small to provide real compensation through a contingency fee arrangement. Of course, none of the parties has seriously suggested that civil rights attorneys can protect themselves through private arrangements. After all, Congress enacted the Fees Act because, after Alyeska, it found such arrangements wholly inadequate. Supra at 748-751.

  9. The Solicitor General's suggestion that we can prohibit waivers sought as part of a "vindictive effort" to teach lawyers not to bring civil rights cases, Tr. of Oral Arg. 22, a point that the Court finds unnecessary to consider, ante at 739-740, is thus irrelevant. Defendants will seek such waivers in every case simply as a matter of sound bargaining. Indeed, the Solicitor General's brief suggests that this will be the bargaining posture of the United States in the future. Brief for United States as Amicus Curiae 12-13.

  10. Since Congress has not sought to regulate ethical concerns either in the Fees Act or elsewhere, the legality of such arguments is purely a matter of local law. See Nix v. Whiteside, ante, at 176 (Brennan, J., concurring in judgment).

  11. One of the more peculiar aspects of the Court's interpretation of the Fees Act is that it permits defendants to require plaintiff's counsel to contribute his compensation to satisfying the plaintiff's claims. In ordinary civil litigation, no defendant would make—or sell to his adversary—a settlement offer conditioned upon the plaintiff's convincing his attorney to contribute to the plaintiff's recovery. Yet today's decision creates a situation in which plaintiff's attorneys in civil rights cases are required to do just that. Thus, rather than treating civil rights claims no differently than other civil litigation, ante at 733 (quoting Marek v. Chesny, 473 U.S. 1, 10 (1985)), the Court places such litigation in a quite unique—and unfavorable—category.


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