Trial Court Fails To Adequately Explain Basis for Cuts. Reduction in Fee Award Reversed.

by Hinshaw & Culbertson LLP
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In Carter v. Caleb Brett LLC, 2014 DJDAR 1412 (2014), the US Court of Appeal for the Ninth Circuit reversed a decision of the district court, making a significant reduction in a fee award. The Ninth Circuit ruled that the district judge’s decision was not supported by a sufficient explanation for the downward modifications taken.

After the adverse decision on the fee petition, the plaintiff appealed to the Ninth Circuit. The Ninth Circuit reviewed the district court’s award of $14,268.50 in attorney fees and costs. The full amount requested by the plaintiff was $22,585.00. The record on appeal revealed that the district court determined that the reasonable hourly rate for the type of work at issue in the relevant geographic area was $400.00. The district court, however, reduced the number of compensable hours from 60.9 to 35 hours. On appeal, the plaintiff argued that the reduction was inappropriate as the court failed to provide an appropriate explanation for the cuts.

The Ninth Circuit noted that the district court has latitude on determining fee awards. However, the award and any reduction must be supported by specific explanations of the reasons for both the award and any reductions. Courts must reach an attorney fee decision by considering the factors enumerated in Kerr v. Screen Extras Guild Inc., 526 F.2d 67 (9th Cir. 1975).

The main factors set forth in Kerr include the time and labor required, the novelty and difficulty of the questions presented, the skill required to perform the legal services properly, the preclusion of other employment due to the acceptance of the case, and the attorney’s customary fees. 

The Ninth Circuit noted that the district court referred to some of the Kerr factors in its analysis, but did not explain which factors justified a significant reduction in the fee request. The district court’s decision was vacated on that basis.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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