Ozinga v. United States Department of Human Services et al
Filing
86
MEMORANDUM Opinion and Order: The Court grants Ozinga's fee petition and awards Ozinga's counsel a total of$89,958.75 in fees. Signed by the Honorable Thomas M. Durkin on 5/22/2018:Mailed notice(srn, )
UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
TIMOTHY OZINGA, et al.,
Plaintiffs,
No. 13 C 3292
v.
Judge Thomas M. Durkin
THE UNITED STATES DEPARTMENT OF
HEALTH AND HUMAN SERVICES, et al.,
Defendants.
MEMORANDUM OPINION AND ORDER
Plaintiffs Ozinga Brothers, Inc., along with its owners and senior managers
(collectively, “Ozinga”), brought this case against defendants United States
Department of Health and Human Services, United States Department of Treasury,
United States Department of Labor, Kathleen Sebelius (Secretary of the
Department of Health and Human Services), Jacob L. Lew (Secretary of the United
States Department of Treasury), and Seth D. Harris (Secretary of the United States
Department of Labor) (collectively, “defendants”) challenging certain aspects of the
Patient Protection and Affordable Care Act of 2010’s contraception mandate. This
Court awarded Ozinga preliminary and then permanent injunctive relief. The
Seventh Circuit reversed the permanent injunction after finding the case moot, but
made clear that Ozinga is still a prevailing party entitled to appropriate attorney’s
fees. Currently before the Court is Ozinga’s petition for attorney’s fees. R. 73.1 For
the following reasons, the Court awards Ozinga’s counsel $89,958.75 in fees.
Background
In this lawsuit, Ozinga sought declaratory and injunctive relief barring
enforcement of the Affordable Care Act’s contraception mandate against Ozinga
because it violated Ozinga’s owners’ and managers’ religious tenets. In July 2013,
this Court granted Ozinga’s motion for a preliminary injunction barring
enforcement of the mandate against Ozinga. R. 23; R. 25.
In August 2013, the Court stayed further proceedings over Ozinga’s objection
pending the Seventh Circuit’s final resolution of two appeals in which motions
panels had held (in 2-1 decisions) that for-profit, closely-held plaintiff companies
(i.e., companies similarly situated to Ozinga) were likely to prevail on their claims
that the contraception mandate substantially burdened their religious rights. See R.
29; Korte v. Sebelius, 528 F. App’x 583 (7th Cir. 2012) (Korte I); Grote v. Sebelius,
708 F.3d 850 (7th Cir. 2013). In November 2013, the Seventh Circuit resolved both
the Korte and Grote appeals in a single opinion, holding that “the balance of harms
favors protecting the religious-liberty rights of the plaintiffs,” and reversing and
remanding “with instructions to enter preliminary injunctions barring enforcement
of the mandate against them.” Korte v. Sebelius, 735 F.3d 654, 659 (7th Cir. 2013)
(Korte II).
Although Ozinga titles his petition “Plaintiffs’ Petition for Attorney’s Fees,
Costs and Expenses,” nowhere does Ozinga itemize or seek costs or expenses. See R.
73.
1
2
In 2014, the Supreme Court confirmed in Burwell v. Hobby Lobby Stores,
Inc., 134 S. Ct. 2751 (2014), that the contraception mandate as applied to closelyheld, private firms whose owners objected on religious grounds substantially
burdened those owners’ (and by extension their companies’) exercise of religion. Id.
at 2768-79. Following the Supreme Court’s decision in Hobby Lobby, the
government amended the applicable regulations in July 2015 to extend to closelyheld, private firms an accommodation previously granted to certain religious
employers. 80 Fed. Reg. 41,318, at 41,322-328 (July 14, 2015).
This Court subsequently lifted the stay in this case, and the parties
introduced competing proposals for an amended form of permanent relief in the
wake of Hobby Lobby. This Court adopted defendants’ proposed permanent
injunction (R. 53), and Ozinga appealed.
On appeal, the Seventh Circuit held that “the revision of the regulatory
framework in July 2015 rendered moot Ozinga’s challenge to the contraception
mandate,” and reversed the permanent injunction. Ozinga v. Price, 855 F.3d 730,
734 (7th Cir. 2017). The Seventh Circuit clarified, however, that:
the revised regulations do not alter Ozinga’s status as a prevailing
party in this case. The change occurred after Ozinga sought and
obtained preliminary injunctive relief and after Hobby Lobby validated
the legal theory that Ozinga and other employers had pursued in this
and similar suits. Consequently, nothing prevents the district court
from entering an appropriate award of fees to Ozinga pursuant to 42
U.S.C. § 1988(b).
Id. at 735-36.
3
Legal Standard
The Civil Rights Attorney’s Fees Awards Act of 1976 provides that a district
court, “in its discretion, may allow the prevailing party . . . a reasonable attorney’s
fee” in suits brought under certain federal civil rights statutes, including 42 U.S.C.
§§ 1983, 1985, and 1986. 42 U.S.C. § 1988(b). “[A] prevailing plaintiff should
ordinarily recover an attorney’s fee unless special circumstances would render such
an award unjust.” Hensley v. Eckerhart, 461 U.S. 424, 429 (1983). The Seventh
Circuit has already found (Ozinga, 855 F.3d at 735)—and both parties agree—that
Ozinga is a prevailing party in this case.
“[I]n view of [its] superior understanding of the litigation,” this Court has
considerable “discretion in determining the amount of a fee award.” Hensley, 461
U.S. at 437. The Court must “‘provide a reasonably specific explanation for all
aspects of a fee determination,’” but its explanation “need not be lengthy.” Pickett v.
Sheridan Health Care Ctr., 664 F.3d 632, 651 (7th Cir. 2011) (quoting Perdue v.
Kenny A., 559 U.S. 542, 558 (2010)).
The “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.” Hensley, 461 U.S. at 433. This calculation is commonly known as the
“lodestar.” E.g., Pickett, 664 F.3d at 639. “[T]here is a strong presumption that the
lodestar figure is reasonable.” Perdue, 559 U.S. at 554. That presumption can be
overcome only “in those rare circumstances in which the lodestar does not
adequately take into account a factor that may properly be considered in
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determining a fee.” Id. “The party seeking an award of fees” has the initial burden
to “submit evidence supporting the hours worked and rates claimed.” Hensley, 461
U.S. at 433.
Analysis
Ozinga’s fee petition seeks: (1) $108,253.69 in fees for attorney Kevin E.
White (the primary litigator in this case), comprised of 303.87 hours at a rate of
$375 per hour; and (2) $43,524.25 in fees for attorney Andy Norman (“Special Fee
Counsel” (R. 73 at 1)), comprised of 83.3 hours at a rate of $550 per hour. R. 82-1 at
1. These requested amounts take into account a 5% reduction from both counsel’s
lodestar “[a]s a showing of good faith.” R. 73 at 1.
The Court first addresses the reasonableness of the hourly rates claimed and
then the reasonableness of the hours totals, keeping in mind the “strong
presumption that the lodestar figure is reasonable.” Perdue, 559 U.S. at 554.
A.
Hourly Rates
The hourly rate component of the lodestar “must be based on the market rate
for the attorney’s work.” Gautreaux v. Chicago Hous. Auth., 491 F.3d 649, 659 (7th
Cir. 2007). “The market rate is the rate that lawyers of similar ability and
experience in the community normally charge their paying clients for the type of
work in question.” Id. “[O]nce an attorney provides evidence establishing [the]
market rate, the opposing party has the burden of demonstrating why a lower rate
should be awarded.” Id. at 659-60.
5
Defendants do not challenge the reasonableness of White’s and Norman’s
hourly rates. And the Court finds those rates adequately supported and reasonable.
White has 34 years of attorney experience and requests an hourly rate of $375. R.
73 at 24; R. 73-1 at 1; R. 73-2. Ozinga sets forth numerous examples of courts in this
district awarding comparable or higher rates for similarly experienced or less
experienced attorneys. R. 73 at 21-22 (collecting cases). Evidence like this of “rates
awarded to similarly experienced . . . attorneys [from the same city] in other civilrights cases in the district” is considered “next-best evidence” in the absence of
“evidence of the attorneys’ actual market rates.” Montanez v. Simon, 755 F.3d 547,
554 (7th Cir. 2014).
Norman, the special fee counsel, has 37 years of attorney experience and
requests an hourly rate of $550. R. 73 at 24; R. 73-1 at 1; R. 73-2. Ozinga points to
one prior decision awarding Norman that rate, and other decisions awarding him
comparable rates. R. 73 at 28 (collecting cases); see also, e.g., Pickett, 664 F.3d at
647 (“a previous attorneys’ fee award is useful for establishing a reasonable market
rate for similar work”). Especially in light of the lack of any challenge by
defendants, the Court finds these requested rates reasonable and awards them.2
The Laffey Matrix further supports these requested rates. The Laffey Matrix
is a table of hourly rates prepared by the United States Attorney’s Office in the
District of Columbia for attorneys in the Washington, D.C. area. The Seventh
Circuit has not explicitly endorsed the use of the Laffey Matrix, and has “expressed
some skepticism about applying the Laffey Matrix outside of Washington, D.C.”
Montanez, 755 F.3d at 554. Nevertheless, the Seventh Circuit has “left it to trial
judges to exercise their discretion in evaluating [the Laffey Matrix’s] usefulness in
any particular case,” id., and courts in this district have accepted it as evidence of a
reasonable hourly rate. See Hadnott v. City of Chicago, 2010 WL 1499473, at *7
2
6
B.
Hours Worked
The hours worked component of the lodestar excludes hours “not reasonably
expended,” including “excessive, redundant, or otherwise unnecessary” hours.
Hensley, 461 U.S. at 434. “[T]he court should disallow not only hours spent on tasks
that would normally not be billed to a paying client, but also those hours expended
by counsel on tasks that are easily delegable to non-professional assistance.” Spegon
v. Catholic Bishop of Chicago, 175 F.3d 544, 553 (7th Cir. 1999). The Court also may
reduce the hours calculation “[w]here the documentation of hours is inadequate.”
Hensley, 461 U.S. at 433.
Ozinga has attached to its fee petition and reply brief detailed attorney time
records showing the hours worked by White and Norman. R. 73-1 at 5-41; R. 73-2 at
6-20; R. 82-2 at 1-2; R. 82-3 at 1-5; R. 82-4 at 1-3. Ozinga requests a total of
$76,398.75 for 203.75 hours on the underlying litigation and $75,379.19 for 183.42
hours on the fee litigation. See R. 74 at 1; R. 82-1. Defendants do not challenge the
adequacy of the documentation for any of counsel’s claimed hours. But defendants
do challenges the hours totals as “excessive, redundant, or otherwise unnecessary”
(Hensley, 461 U.S. at 433) for both the underlying litigation and the fees-on-fees
request.
(N.D. Ill. Apr. 12, 2010) (citing cases and concluding “that the Laffey Matrix is
‘satisfactory evidence’ of the prevailing rate, so that the burden shifts to opposing
counsel to show why a lower rate is essential”). The Laffey Matrix reveals that an
attorney with 20-plus years of complex litigation experience is entitled to an hourly
rate of $520—far more than White seeks and close to the amount that Norman
seeks (with Norman having considerably more experience than 20 years). R. 73 at
24.
7
1.
Underlying Litigation
Background Research and Complaint. Defendants first take issue with
the 76.2 hours White spent from November 20, 2012 through filing the complaint on
May 1, 2013, including 58.3 hours drafting the complaint and 17.9 hours on
background research and investigation. Defendants point out that at the time this
case was filed, 29 similar cases were pending across the country, and White
consulted with counsel who had already filed a similar case in this district. R. 74-1
¶¶ 3, 4. Motions panels in Korte I and Grote also had already granted preliminary
injunctions pending appeal at the time this case was filed. Korte I, 528 F. App’x 583;
Grote, 708 F.3d 850. Defendants therefore say White could have and should have
been more efficient. Defendants request that the Court reduce the award for this
phase of the case to no more than 30 hours.
As Ozinga points out, defendants’ argument ignores the larger national
backdrop of vigorous opposition by defendants to cases like Ozinga’s. The Court
agrees with Ozinga that White should not be penalized now in hindsight for time
spent in 2012 and 2013 trying to anticipate how best to litigate the case, including
how best to draft the complaint, in the midst of this rapidly evolving legal
landscape. Although the motions panels in Korte I and Grote had come out in
plaintiffs’ favor, these were 2-1 preliminary decisions that gave the plaintiffs in
those cases and Ozinga no assurance of victory on the merits. Korte I, 528 F. App’x
583; Grote, 708 F.3d 850. Indeed, defendants themselves in their July 13, 2013
motion to stay this case described the questions at issue as “largely novel,” and
8
noted that “courts around the country that have thus far confronted these issues in
similar cases have reached contradictory results.” R. 17 at 4. It took years for many
of these cases to be ultimately resolved. See R. 82 at 7.
As Ozinga further points out, White should not be penalized for being
thorough and careful with his work and for being prepared to pursue the case
zealously. As a district court in Minnesota reasoned in a similar case when
declining to reduce number of hours counsel spent on efforts including “prepar[ing]
a strong complaint” and “appris[ing] themselves of the relevant case law”: “[t]he
plaintiffs . . . could not know how the Eighth Circuit would rule on its pending
cases, or how the United States Supreme Court would rule in Hobby Lobby. The
plaintiffs’ counsel would have done their clients a disservice by being unprepared to
move forward with the litigation if the appeals were resolved differently.” Hall v.
Sebelius, 2016 WL 424965, at *6 (D. Minn. Feb. 3, 2016). Like the Hall court, this
Court awards White his lodestar for background research and complaint drafting.
Preliminary Injunction Motion. Defendants also say White should not be
fully compensated for the 58.3 hours spent researching and drafting Ozinga’s
motion for a preliminary injunction (accompanied by a 78-paragraph supporting
declaration by the individual Ozinga plaintiffs (R. 19-2)) because defendants did not
oppose the injunction. Although defendants acknowledge that White did not know
about the lack of opposition when he began working on the motion, defendants say
that he should have known that the government had already consented to
injunctions in six cases, and could have asked for defendants’ position at any time.
9
Defendants therefore say White should be compensated for no more than two of the
58.3 hours spent on the motion.
As Ozinga points out, this argument “is premised on the erroneous
assumption that the parties could have somehow entered into an agreed injunction
order with no motion for injunction”—or with a very limited motion—“on file.” R. 82
at 10. To the contrary, “plaintiffs must carry the burden of persuasion with respect
to the four prerequisites of a preliminary injunction.” Cox v. City of Chicago, 868
F.2d 217, 219 (7th Cir. 1989). And a plaintiff’s filings must enable the Court to
make the requisite, specific findings. See Chathas v. Local 134 Int’l Bhd. of Elec.
Workers, 233 F.3d 508, 512 (7th Cir. 2000) (“[t]he requirements for a valid
injunction are found in Rule 65(d) of the Federal Rules of Civil Procedure, which
provides, so far as pertinent here, that ‘every order granting an injunction . . . shall
set forth the reasons for its issuance; shall be specific in terms; shall describe in
reasonable detail, and not by reference to the complaint or other document, the act
or acts sought to be restrained.’”). Accordingly, Ozinga needed to prepare and
support its request for a preliminary injunction regardless of whether defendants
opposed it.
This is not a situation like in Taggert-Jeffries v. Astrue, 2011 WL 304591
(E.D. Mo. Jan. 28, 2011), a case cited by defendants, where filing “a brief in support
of the complaint” was wholly unnecessary because the plaintiff did not seek “judicial
determination for her eligibility for benefits.” Id. at *2. Nor is this a situation where
defendants could have or would have given Ozinga everything it wanted and White
10
continued to rack up bills anyway. Compare Spegon, 175 F.3d at 552-53 & n.4 (case
relied on by defendants reducing fees where claim might have been easily resolved
without litigation if plaintiff’s counsel had contacted the defendant before suing).
Thus, the hours spent researching and drafting the preliminary injunction motion
are reasonable and recoverable.
Post-Permanent Injunction. Defendants next argue that White is not
entitled to fees for most of his work after the government consented to a permanent
injunction on May 13, 2015. Specifically, they claim that White should be
compensated for only 1.5 of the 24.6 hours spent litigating the scope of the
permanent injunction (where the Court adopted defendants’ proposal), filing a
motion for a settlement conference that was denied, filing a notice of supplemental
authority, and filing a notice of appeal. Defendants say that plaintiffs should not be
compensated for these unsuccessful efforts. In support, however, defendants cite
cases where courts declined to award fees for an unsuccessful and distinct claim.
See Hensley, 461 U.S. at 434-35 (fees should not be awarded where plaintiff is
successful on one claim and not on another if the claims are “distinctly different”
from one other, “based on different facts and legal theories”); West v. Matthews Int’l
Corp., 2011 WL 3904100, at *5 (E.D. Mo. Sept. 6, 2011) (deducting .3 hours
“specifically described as having been expended on the issue of punitive damages”
where “jury . . . ruled against plaintiff on his claim for punitive damages”).
The Supreme Court and Seventh Circuit have made clear that plaintiff’s
counsel should not be denied full compensation merely because they did not succeed
11
on an argument in support of a claim or lost an interim ruling, as long as they
ultimately succeeded. E.g., Hensley, 461 U.S. at 435 (“the fee award should not be
reduced simply because the plaintiff failed to prevail on every contention raised in
the lawsuit”); Kurowski v. Krajewski, 848 F.2d 767, 776 (7th Cir. 1988) (“a losing
argument in support of a successful claim for relief is fully compensable time”); see
also Urban v. United States, 2006 WL 2037354, at *4 (N.D. Ill. July 14, 2006)
(“When plaintiffs attain success, courts should not decline to award fees to the
plaintiffs’ attorneys solely because certain zealous advocacy that was appropriately
provided their clients did not contribute directly to that success.”).
Nor does the fact that the Seventh Circuit ultimately dismissed Ozinga’s
appeal as moot change this Court’s analysis. The Seventh Circuit in People Who
Care v. Rockford Bd. of Educ., Sch. Dist. No. 205, 90 F.3d 1307 (7th Cir. 1996),
rejected an argument that “because [the Seventh Circuit] dismissed [an] appeal as
premature, the plaintiffs had not been ‘successful’ and attorney’s fees were therefore
unwarranted.” Id. at 1314. The Rockford court explained that “[a] court’s focus
should not be limited to the success/failure of each of the attorney’s actions. Rather,
it should be upon whether those actions were reasonable,” and particularly whether
each decision was reasonable “at the time it was made.” Id.
The Seventh Circuit made clear in its ruling on appeal that Ozinga is a
successful, prevailing party entitled to “an appropriate award of fees.” Ozinga, 855
F.3d at 736. The Court finds the hours White spent arguing for a different form of
permanent injunction and grappling with the relevant case law, seeking a
12
settlement conference to resolve the litigation, filing a notice of supplemental
authority, and filing a notice of appeal to have been reasonable at the time and
recoverable. See Rockford, 90 F.3d at 1314.
Other Tasks. Defendants also take issue with compensating White for a
number of discrete tasks that defendants claim were unnecessary or unrelated to
the litigation. First, defendants say the 6.3 hours White spent drafting a surresponse to defendants’ motion to stay (R. 26) is excessive because that filing was
only seven pages long and summarized three decisions defendants had already
identified, and because defendants ultimately succeeded on their motion to stay.
But again, “[p]laintiffs are not to be denied full attorneys’ fees merely because they
lost some interim rulings en route to ultimate success.” Urban, 2006 WL 2037354,
at *4. Nor does Court find 6.3 hours to be a an unreasonable amount of time to draft
a seven-page filing that was quite detailed and cited a number of cases beyond the
three defendants mention. See R. 26.
Second, defendants say White should not be compensated for the 13.8 hours
spent drafting a motion to lift the stay in November 2013 because that motion was
never filed. But as Ozinga explains, drafting that motion made sense at the time
White drafted it because the Seventh Circuit had just issued its decisions in the
Korte and Grote cases, based on which this Court had stayed the case. See Korte II,
735 F.3d 654. Ozinga subsequently decided not to file the motion because
defendants gave notice that they intended to file a petition for certiorari in the
13
Supreme Court, see Burwell v. Korte, 134 S. Ct. 2903 (2014) (denying certiorari),
and Ozinga reasoned that this Court was therefore unlikely to lift the stay.
This is a far cry from the situation in the cases cited by defendants. In
Trustees of Chicago Plastering Inst. Pension Trust v. Cork Plastering, Inc., 2008 WL
728897 (N.D. Ill. Mar. 18, 2008), the court disallowed 0.6 hours preparing a motion
for default that was never filed because it was commenced after the answer was
filed, suggesting that the work was unnecessary. Id. at *5. And in Divane v. Mitchell
Sec. Sys. Inc., 2008 WL 938381 (N.D. Ill. Apr. 7, 2008), the court disallowed 4.5
hours spent on a summary judgment motion that plaintiffs gave no explanation for
not filing. Id. at *2. By contrast, Ozinga has a sound explanation for not filing the
stay motion.
Third, defendants object to the 10.9 hours White spent on “coverage issues”
and “carrier issues” as unrelated to the litigation. As Ozinga explains, however,
these were discussions with Ozinga’s insurance carriers about the form of injunction
that would achieve the outcome Ozinga desired of discontinuing coverage that
violated its owners’ religious beliefs. R. 82 at 18-19. The Court finds these
discussions sufficiently related to the litigation to be compensable.
Comparable Cases. Finally, defendants point out that in 14 of 17 for-profit
contraception coverage cases like Ozinga’s in which the government consented to an
injunction and the case was subsequently stayed, plaintiffs’ counsel spent
significantly fewer hours than White on the underlying case. R. 74-1 ¶¶ 11-12.
Defendants cite the Seventh Circuit’s instruction in Bonner v. Coughlin, 657 F.2d
14
931 (7th Cir. 1981), that “[i]n determining a fee award, the court should consider
the number of hours ordinarily necessary competently to prepare comparable
cases.” Id. at 934. But the Bonner court merely noted this as a relevant
consideration; it did not hold that courts should make an arbitrary cut to the
lodestar based on numbers of hours billed in comparable cases. Indeed, the Seventh
Circuit has since made clear that courts may not simply “cut [the fee request] down
by an arbitrary percentage because it seem[s] excessive to the court.” Rockford, 90
F.3d at 1314. Nor do defendants make any specific request for a reduction in fees
based on this argument.
Moreover, comparability is inherently fact-specific. As Ozinga explains, a
number of the cases defendants proffer were filed later than this one and arguably
in more favorable jurisdictions for plaintiffs. R. 82 at 16. Ozinga further
emphasizes, and defendants acknowledge (R. 74 at 14 n.9), that the time spent by
plaintiffs’ attorneys in the three of the 17 cases was comparable to White’s time in
this case.
White has already agreed to a five percent reduction from the lodestar—
which is presumed reasonable—in a showing of good faith, and the Court does not
find a further reduction appropriate. The Court therefore awards White his full
requested amount of $76,398.75 in fees for the underlying litigation.
2.
Fees-on-Fees
Defendants do not challenge Ozinga’s counsel’s entitlement to some amount
of fees-on-fees. And for good reason. It is well-established that a prevailing plaintiff
15
in a civil rights case may recover fees-on-fees. E.g., Ustrak v. Fairman, 851 F.2d
983, 987-90 (7th Cir. 1988).
Defendants instead object to the number of hours expended on fee-related
litigation and the corresponding amount of the fees-on-fees request. As they point
out, White and Norman seek nearly the same amount of fees-on-fees as White does
for the underlying litigation: $76,398.75 for 203.75 hours worked on the underlying
litigation and $75,379.19 for 183.42 hours worked on the fee litigation (accounting
for Norman’s higher rate).
The parties raise a threshold legal issue as to whether the ratio of hours
spent on fees and hours spent on the underlying litigation (here almost exactly oneto-one) should be taken into consideration when determining a proper fees-on-fees
award. The Seventh Circuit has answered this question in the affirmative. In
Ustrak, the Seventh Circuit reversed a fees-on-fees award for which “[f]or every
hour spent litigating the merits the plaintiff’s attorney’s devoted almost 15 minutes
to preparing a petition requesting fees for that hour.” Id. at 987-88. The Seventh
Circuit “disallow[ed] two-thirds of the lawyer and student hours allowed for the
preparation of the fee petitions,” explaining that “[t]he allowance [wa]s still a
generous one.” Id. at 988. It explained that the situation “reinforc[ed] [its]
impression that lawyers litigate fee issues with greater energy and enthusiasm
than they litigate any other type of issue,” which it characterized as “the tail
wagging the dog, and with a vengeance.” Id. at 987-88.
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Ozinga claims the Seventh Circuit did not mean what it said in Ustrak and
attempts to distinguish that case. But the Seventh Circuit reaffirmed its holding in
Ustrak eleven years later in Spegon, a case Ozinga does not mention in its fees-onfees discussion. The Seventh Circuit in Spegon addressed a situation like this one
where counsel “spent approximately the same number of hours preparing the fee
petitions as he requested in pursuing the merits of the case.” 175 F.3d at 554. The
court explained that “[i]f we considered the ratio of fifteen minutes worked on the
fee petition for every hour worked on the merits to be ‘excessive’ in Ustrak, we must
agree with the district court that it is patently unreasonable for [lead counsel] . . . to
expend the same number of hours, or almost as many, on Spegon’s fee petition as he
expended on the merits of Spegon’s case.” Id. The Spegon court affirmed the district
court’s decision to reduce the fees-on-fees award from 9.2 hours to 1.6 hours. Id. at
554 & 551 n.2.3
Contrary to what Ozinga claims, the Seventh Circuit did not “effectively
preclude[ ] . . . a limitation of fees on fees by comparison to the merits portion of the
case” (R. 82 at 23) in BCS Servs., Inc. v. BG Investments, Inc., 728 F.3d 633 (7th Cir.
2013). Rather, the BCS court rejected “the argument that the fee award was
excessive because it was almost twice the damages awarded the plaintiffs at trial.”
Id. at 642 (emphasis added). In that context, the court explained that “[a]ttorney fee
shifting, as under RICO, is intended to facilitate suit by victims of unlawful
behavior, . . . and awarding legal fees reasonably incurred ex ante even if excessiveseeming ex post (which is to say with the wisdom of hindsight) is necessary to
achieve that objective.” Id. The BCS court did not address fees-on-fees or the
appropriate relationship between those fees and fees for the underlying litigation.
Ozinga also points to the Seventh Circuit’s opinion in Graham v. Sauk
Prairie Police Comm’n, 915 F.2d 1085 (7th Cir. 1990), affirming a fees-on-fees
award of 99.25 hours. Id. at 1109. But Ozinga fails to mention that the Seventh
Circuit also affirmed an award of 1,339.8 hours of fees for the underlying litigation,
see id., making the fees-on-fees award a reasonably small percentage of the total.
3
17
Numerous courts in this district have subsequently cited Spegon and Ustrak
for the basic proposition that “[w]here the time expended preparing a fee petition is
disproportionate to the time spent on the merits of the case, courts reduce the
amount of time recoverable for the preparation of the fee petition.” Farmer v.
DirectSat USA, 2015 WL 13310280, at *4 (N.D. Ill. Sept. 24, 2015); Mays v.
Springborn, 2014 WL 12730575, at *7 (C.D. Ill. Nov. 6, 2014) (same); Gibson v. City
of Chicago, 873 F. Supp. 2d 975, 992 (N.D. Ill. 2012) (same).
This Court therefore agrees with defendants that a significant reduction is
called for in the calculation of fees-on-fees. In particular, Court agrees with
defendants that the 35.94 hours White and Norman spent compiling billing records
is excessive. As defendants point out, “it is hard to imagine that plaintiffs’ counsel
would ask a paying client to compensate counsel for 35.94 hours to figure out how
much the client owes.” R. 74 at 12. And “[h]ours that are not properly billed to one’s
client also are not properly billed to one’s adversary.” Hensley, 461 U.S. at 434. The
Court therefore reduces this time to 3 hours (i.e., $1,387.50, divided evenly between
White’s and Norman’s hourly rates) as defendants suggest. R. 74 at 12.
The Court also agrees with defendants that the 34.3 hours White and
Norman spent negotiating a fee-related settlement is excessive. Ozinga maintains
that this expenditure was necessary because of defendants’ low-ball settlement
tactics. But the Court does not find evidence that defendants negotiated in bad
faith. Indeed, Ozinga acknowledges (R. 82 at 22) that defendants made a final
settlement offer amounting to a significant percentage of the $76,398.75 in fees
18
ultimately requested for the underlying litigation.4 The Court agrees with
defendants that Ozinga’s counsel should be awarded 3 total hours ($1,387.50) for fee
negotiations.
The final portion of the fees-on-fees request is for the 35.3 hours White and
Norman spent drafting the fee petition and the 71.3 hours they spent on the fee
petition reply (a total of 106.6 hours). Defendants point out that although Norman
was brought into the case to provide expertise in fees litigation, he expended nearly
as many hours as White on the fees litigation. The fact that White handled the
underlying case by himself and brought in special fee counsel at a much higher
billing rate for the specific purpose of the fee petition is clear evidence of “the tail
wagging the dog.” Ustrak, 851 F.2d at 987.
The Court therefore reduces the number of hours for Ozinga’s fee petition and
reply to 16 hours ($7,400), as suggested by defendants, which is in line with or more
generous than reductions made by other courts for lack of proportionality. See R. 74
at 14 (defendants advocating that the Court award no “more than $7,400 for 16
hours for both plaintiffs’ motion and forthcoming reply”); see, e.g., Spegon, 175 F.3d
at 554 (affirming district court’s reduction for “hours spent on the fee petitions”
from 9.2 hours to 1.6 hours); Uphoff v. Elegant Bath, Ltd., 176 F.3d 399, 411 (7th
Cir. 1999) (affirming district court’s reduction of hours spent on fee motion from 9.9
hours to 1.6 hours); Gibson, 873 F. Supp. 2d at 992 (10 minutes to prepare fee
Defendants properly object to Ozinga’s discussion of specific settlement offers
under Fed. R. Evid. 408, and the Court does not disclose those specific numbers in
its opinion.
4
19
petition for every hour on the merits was excessive; reducing request by half); Mays,
2014 WL 12730575, at *7 (100:1 ratio of work on merits compared to fee preparation
reasonable); Farmer, 2015 WL 13310280, at *4 (awarding 13.7 hours of time spent
on fee petition where plaintiffs requested 300).
In sum, the Court awards White and Norman 3 hours for compiling billing
records, 3 hours for fees negotiations, and 16 hours for fee petition briefing. This
adds up to 22 hours, which comes to $10,175 when divided equally between White’s
and Norman’s billing rates as defendants suggest. The Court also awards White and
Norman 6.6 hours ($3,385) for briefing and arguing a motion for extension of time to
file the fee petition because defendants do not oppose that award. See R. 74 at 12
n.7. This results in a total award of $13,560 in fees-on-fees.
*
*
*
Combining the $76,398.75 awarded for the underlying litigation with the
$13,560 awarded for the fee litigation, the total amount of the fee award is
$89,958.75. This total is in line with awards made in similar cases. See Hall, 2016
WL 424965, at *6 (awarding $9,750 for preparing attorney’s fees motion and
$68,670 for the underlying merits in similar case challenging contraception
mandate).
Conclusion
For the foregoing reasons, the Court awards Ozinga’s counsel a total of
$89,958.75 in fees.
20
ENTERED:
______________________________
Honorable Thomas M. Durkin
United States District Judge
Dated: May 22, 2018
21
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