Bickel v. Whitley County Sheriff

Filing 179

OPINION AND ORDER DENYING 172 MOTION for Interim Attorney Fee Award by Plaintiff Lawrence M Bickel; DENYING 177 MOTION to Supplement 172 MOTION for Interim Attorney Fee Award by Plaintiff Lawrence M Bickel. Signed by Judge Theresa L Springmann on 2/24/14. (cer)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF INDIANA
FORT WAYNE DIVISION
LAWRENCE M. BICKEL, on behalf
of himself and others similarly situated,
Plaintiff,
v.
SHERIFF OF WHITLEY COUNTY
(in his official capacity),
Defendant.

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CAUSE NO.: 1:08-CV-102-TLS

OPINION AND ORDER
In this class action litigation, Plaintiff Lawrence M. Bickel, on behalf of himself and
others similarly situated, sued the Sheriff of Whitley County in his official capacity. Although
the Defendant’s liability has been established, this matter remains pending for approval of a
proposed settlement, which has not yet been filed with the Court. Class Counsel seeks an interim
award of fees in the amount of $274,444.75 and costs in the amount of $5,178.74 for work done
and costs incurred through December 11, 2013. The Defendant does not object to Class
Counsel’s request for interim payment.

BACKGROUND
On March 27, 2008, the Plaintiff filed his Complaint. The Plaintiff later sought to certify
the class and to obtain judgment as a matter of law on the issue of whether the Defendant, in his
official capacity, engaged in a practice, procedure, or custom that resulted in probable cause
determinations to occur more than 48 hours after a warrantless arrest. Relying on the Supreme
Court’s decisions in Gerstein v. Pugh, 420 U.S. 103, 114 (1975) (holding that the Fourth

Amendment affords persons who are arrested without a warrant the right to a prompt judicial
determination of probable cause “as a prerequisite to extended restraint of liberty following
arrest”), and County of Riverside v. McLaughlin, 500 U.S. 44, 56 (1991) (holding that a
“jurisdiction that provides judicial determinations of probable cause within 48 hours of arrest,
will, as a general matter, comply with the promptness requirement of Gerstein”), the Court found
that the Defendant’s policy pertaining to confinement and detainment in the Whitley County Jail
violated the Fourth Amendment as a matter of law. After the lawsuit was filed, the Defendant
instituted a change in policy that was intended to address the deficiency in the existing
procedures that had been exposed by the litigation, and to eliminate future violations. In April
2010, the Court certified a class and Class Counsel continued working to identify all members of
the class and provide the appropriate notice. In November 2012, the Court issued a ruling on a
dispute that had arisen between the parties concerning the compensable time of injury.
In December 2013, the parties participated in a settlement conference that concluded
without resolution. Later that month, however, the Plaintiff filed a Notice of Resolution [ECF
No. 174], advising that the case had settled for $725,000.00, inclusive of all attorneys’ fees and
costs, including costs of administration of the class action settlement.

ANALYSIS
A “prevailing party” is entitled to reasonable attorney fees in a civil rights action brought
under 42 U.S.C. § 1983. See 42 U.S.C. § 1988(b). The presumption is that 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); Dunning v. Simmons Airlines,

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Inc., 62 F.3d 863, 872 (7th Cir. 1995). “[P]laintiffs may be considered ‘prevailing parties’ for
attorney’s fees purposes if they succeed on any significant issue in litigation which achieves
some of the benefit the parties sought in bringing suit.” Hensley, 461 U.S. at 433. Class Counsel
relies on the principle that a court has discretion to award interim attorney’s fees even though
litigation remains pending when the court has entered a concrete order that “determines
substantial rights of the parties,” meaning “when a party has prevailed on the merits of at least
some of his claims.” Hanrahan v. Hampton, 446 U.S. 754, 757–58 (1980).
However, this case also requires that the district court scrutinize and evaluate the
proposed settlement, as it will affect the dismissal of a class action, to determine whether it is
“fair, reasonable, and adequate.” Williams v. Rohm & Haas Pension Plan, 658 F.3d 629, 634
(7th Cir. 2011) (quoting Fed. R. Civ. P. 23(e)(2)). Courts are to “exercise the highest degree of
vigilance in scrutinizing proposed settlements of class actions.” Reynolds v. Beneficial Nat’l
Bank, 288 F.3d 277, 279 (7th Cir. 2002). In most cases, a court cannot make an informed
judgment about the fairness, reasonableness, and adequacy of a class without assessing the
likelihood and value to the class of the case’s possible outcomes, referred to as the net expected
value of the litigation. See Williams, 658 F.3d at 634 (citing Synfuel Techs., Inc. v. DHL Exp.
(USA), Inc., 463 F.3d 646, 653 (7th Cir. 2006)). A court must normally “weigh the value of the
proposed settlement against the total amount that the class could recover, discounted by the
weaknesses and risks inherent in the class’ claims.” Schulte v. Fifth Third Bank, 805 F. Supp. 2d
560, 578 (N.D. Ill. 2011).
There is no question that the Plaintiff is a prevailing party in this litigation, and that Class
Counsel has submitted documentation in support of their request under the lodestar method.

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However, given the Court’s obligations as it relates to class actions, the Court cannot approve an
interim award of fees. Although this case was initiated under a statute with a fee shifting
provision, it was settled with the creation of a common fund, and payment to Class Counsel will
diminish the common fund. (See Notice of Resolution, ECF No. 174 (advising that the case had
settled “for $725,000.00, inclusive of all attorneys’ fees and costs, including costs of
administration of the class action settlement”). Thus, the Court cannot consider Class Counsel’s
request in a vacuum, but must examine it in the broader context of the proposed class action
settlement. Any award of fees necessarily will reduce the common fund, and reduce the benefits
conferred on the class members, and may impact the Court’s future duty to act as a “fiduciary of
the class,” Reynolds, 288 F.3d at 280. The Court is without any information regarding the net
expected value of the litigation, and thus cannot know if the remainder of the fund—after the
interim award and ongoing fees and costs— will confer a result that is fair, reasonable, and
adequate. See Reynolds, 288 F.3d at 284–85 (noting that a settlement for less than the net
expected value of continued litigation would not be adequate).
Moreover, Class Counsel has presented his request for interim fees using the lodestar
method, but in common fund cases (even those initiated under a statute with a fee-shirting
provision) the court retains discretion to whether to use a percentage of the fund or the lodestar
to determine counsel’s compensation. Florin v. Nationsbank of Georgia, N.A., 34 F.3d 560, 566
(7th Cir. 1994). In exercising that discretion, the Seventh Circuit has “held repeatedly that, when
deciding on appropriate fee levels in common-fund cases, courts must do their best to award
counsel the market price for legal services, in light of the risk of nonpayment and the normal rate
of compensation in the market at the time.” In re Synthroid Mktg. Litig., 264 F.3d 712, 718 (7th

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Cir. 2001); see also Williams v. Rohm & Haas Pension Plan, 658 F.3d 629, 636 (7th Cir. 2011)
(approving methodology for determining fees where court “recognized that its task was to assign
fees in accord with a hypothetical ex ante bargain; it weighed the available market evidence; and
it assessed the amount of work involved, the risks of nonpayment, and the quality of
representation”) (internal citations omitted). The Court is not in a position, in this stage of the
litigation, to make the necessary inquires and determinations regarding the appropriate fees to
award Class Counsel.
Additionally, the Court is concerned that the procedures set forth in Federal Rule of Civil
Procedure 23(h) have been overlooked. The Rule provides:
(h) Attorney’s Fees and Nontaxable Costs. In a certified class action, the court
may award reasonable attorney’s fees and nontaxable costs that are authorized by
law or by the parties’ agreement. The following procedures apply:
(1) A claim for an award must be made by motion under Rule 54(d)(2), subject to
the provisions of this subdivision (h), at a time the court sets. Notice of the
motion must be served on all parties and, for motions by class counsel, directed to
class members in a reasonable manner.
(2) A class member, or a party from whom payment is sought, may object to the
motion.
(3) The court may hold a hearing and must find the facts and state its legal
conclusions under Rule 52(a).
(4) The court may refer issues related to the amount of the award to a special
master or a magistrate judge, as provided in Rule 54(d)(2)(D).
Fed. R. Civ. P. 23(h). Specifically, there is no indication that notice of the motion was directed to
the class members in a reasonable manner.

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CONCLUSION
For the reasons stated above, the Court DENIES Counsel’s Verified Petition for Interim
Award of Fees and Costs [ECF No. 172], and Plaintiff’s Supplementation to Interim Request for
Attorneys’ Fees and Costs [ECF No. 177].
SO ORDERED on February 24, 2014.
s/ Theresa L. Springmann
THERESA L. SPRINGMANN
UNITED STATES DISTRICT COURT
FORT WAYNE DIVISION

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