Casa Marie, Inc. v. Superior Court of PR

• Court: Court of Appeals for the First Circuit
• Decided: October 28, 1994
• Docket: 94-1408
• Status: Published

Opinion

USCA1 Opinion

UNITED STATES COURT OF APPEALS
                                FOR THE FIRST CIRCUIT

                              _________________________

          No. 94-1408

                      CASA MARIE HOGAR GERIATRICO, INC., ET AL.,

                               Plaintiffs, Appellants,

                                          v.

                            ESTHER RIVERA-SANTOS, ET AL.,

                                Defendants, Appellees.

                              _________________________

                     APPEAL FROM THE UNITED STATES DISTRICT COURT

                           FOR THE DISTRICT OF PUERTO RICO

                    [Hon. Jose Antonio Fuste, U.S. District Judge]
                                              ___________________

                              _________________________

                                        Before

                                Selya, Circuit Judge,
                                       _____________

                           Campbell, Senior Circuit Judge,
                                     ____________________

                              and Stahl, Circuit Judge.
                                         _____________

                              _________________________

               Charles S.  Hey-Maestre, with  whom Rick Nemcik-Cruz  was on
               _______________________             ________________
          brief, for appellants.
               Ramon L. Walker Merino for appellees.
               ______________________

                              _________________________

                                   October 28, 1994

                              _________________________


SELYA, Circuit Judge.  In this appeal, Casa Marie Hogar
                    SELYA, Circuit Judge.
                           _____________

          Geriatrico, Inc. (Casa Marie), a residential elder-care facility,

          and its principals, Victor Pla, Damaris Rodriguez, Maria Pla, and

          Francisco  Monrouzeau  (collectively,  appellants), calumnize  an

          order assessing attorneys' fees against them under  the Fees Act,

          42 U.S.C.   1988  (1988).  Because the district  court's findings

          are not sufficiently complete  to justify a fee award,  we vacate

          the order and remand for further proceedings.

          I.  BACKGROUND
          I.  BACKGROUND

                    The history  of this litigation has  been chronicled at

          considerable   length  both  in   the  district  court's  initial

          decision,  see Casa Marie, Inc.  v. Superior Court,  752 F. Supp.
                     ___ ________________     ______________

          1152,  1154-60 (D.P.R. 1990) (Casa  Marie I), and  in our opinion
                                        _____________

          vacating the  judgment entered pursuant thereto,  see Casa Marie,
                                                            ___ ___________

          Inc.  v. Superior  Court, 988  F.2d 252,  255-58 (1st  Cir. 1993)
          ____     _______________

          (Casa Marie II).  Because there is scant benefit in repastinating
           _____________

          well-spaded soil, we touch  only on such matters as  are directly

          relevant to the instant appeal.

                    Casa Marie's decision to locate its elder-care facility

          within  the municipality of Arecibo, Puerto Rico, set in motion a

          train of events that led to the present encounter.  Displeased by

          Casa Marie's  intrusion into a residential  subdivision, Jardines

          de Arecibo (JDA),  a group of neighbors filed  suit in the Puerto

          Rico  Superior  Court  on April  18,  1988.    They alleged  that

          operation  of the facility  violated municipal  zoning ordinances

          and restrictive covenants applicable to the JDA subdivision.

2


After  vigorous skirmishing,  not  relevant  here,  the

          superior  court entered  judgment for  the neighbors  and ordered

          Casa  Marie to  close its  doors.   When appellants  continued to

          operate  in   defiance  of  the  ban,   the  neighbors  initiated

          enforcement proceedings.  On October 9, 1990,  the superior court

          issued  a  civil  contempt  citation,  ordering  the  arrest  and

          imprisonment of Casa Marie's principals if  they failed to comply

          with the original judgment within a stated time frame.

                    At that point, appellants apparently concluded that the

          best defense  was a good offense.   Joined by a  cadre of elderly

          persons who resided  at the facility, appellants  brought a civil

          action  in the United States  District Court for  the District of

          Puerto  Rico  on October  19, 1990.    The plaintiffs  invoked 42

          U.S.C.   1983 (1988) and the Fair Housing Act, 42 U.S.C.    3601-

          3617 (1993) (FHA), alleging  that the neighbors and the  superior

          court had acted in  concert to enforce the zoning  ordinances and

          restrictive covenants selectively;  that these efforts were  born

          of  a   discriminatory  animus;   and  that,  by   composing  and

          orchestrating  this scheme,  the  named  defendants  transgressed

          section 1983, the Equal Protection Clause, and the FHA.

                    The   district   court   proved  hospitable   to   this

          counteroffensive.   It determined that  the neighbors' use of the

          local  court  system constituted  "state  action,"  and that  the

          elderly  persons  residing   at  the  facility  had   established

          violations of both section  1983 and the FHA.   Consequently, the

          district court enjoined the neighbors from executing the superior

3


court  judgment.   See Casa  Marie  I, 752  F. Supp.  at 1165-69.
                             ___ ______________

          However,  the  court's hospitality  extended  only  to the  aged;

          remarking appellants' participation in the earlier superior court

          action  and citing  res judicata  principles, the  district court
                              ___ ________

          dismissed  their  federal claims  but kept  them  in the  case as

          "necessary parties  for the disposition of  th[e] separate action

          by the elders."  Id. at 1161.
                           ___

                    On appeal, a  panel of this court vacated  the district

          court's judgment on two  grounds.  First, the panel  discerned no

          state action sufficient to undergird the section 1983 claim.  See
                                                                        ___

          Casa Marie  II, 988 F.2d at 258-60.  Second, the panel ruled that
          ______________

          federal  law,  including  abstention  doctrines  and  the   Anti-

          Injunction Act, 28 U.S.C.   2283 (1988), barred injunctive relief

          under  the FHA.  See  Casa Marie II, 988 F.2d  at 260-70.  In the
                           ___  _____________

          last  sentence of  the opinion,  the panel stated  that "[d]ouble

          costs are  awarded against Casa  Marie and  its owners."   Id. at
                                                                     ___

          270.

                    In due course, the neighbors, having  prevailed, sought

          upward of $25,000 in counsel fees against appellants (though  not

          against  the  other  plaintiffs).   On  February  25,  1994,  the

          district  court granted  the neighbors'  application in  part and

          awarded fees in the  amount of $18,052.50.  The court  hinged its

          order on the Fees Act, restricting the award to time spent on the

          section 1983 claim  and disregarding  all time spent  on the  FHA

4


claim.  This appeal followed.1

II.  LEGAL PRINCIPLES AFFECTING REVIEW
          II.  LEGAL PRINCIPLES AFFECTING REVIEW

                    It  is  firmly  settled  in  this  circuit  that,  when

          shifting  fees, "the district  court is  expected to  explain its

          actions."   Foster v. Mydas Assoc.,  Inc., 943 F.2d 139, 141 (1st
                      ______    ___________________

          Cir. 1991).  One cardinal  reason for this rule is  to facilitate

          appellate review    a goal that is better achieved  when the nisi
                                                                       ____

          prius  court  produces   a  suitable  set  of   findings  and  an
          _____

          explication of why  it authored  the particular fee  award.   See
                                                                        ___

          Peckham v. Continental Cas. Ins. Co., 895 F.2d 830, 842 (1st Cir.
          _______    _________________________

          1990).  Although such findings need not be  "infinitely precise,"

          United States v. Metropolitan  Dist. Comm'n, 847 F.2d 12,  16 n.4
          _____________    __________________________

          (1st Cir. 1988), they must be reasonably complete  and offer at a

          bare  minimum  a "clear  explanation  of  [the district  court's]

          reasons for the fee  award," Hensley v. Eckerhart, 461  U.S. 424,
                                       _______    _________

          437 (1983),  together with  some appropriate "method  and manner"

          insight into how the  award was calculated, see Blum  v. Stenson,
                                                      ___ ____     _______

          465 U.S. 886, 888 (1984). 

                    We  review fee-shifting orders for abuse of discretion.

          See Foley  v. City of  Lowell, 948 F.2d  10, 18 (1st  Cir. 1991);
          ___ _____     _______________

          Metropolitan  Dist.  Comm'n, 847  F.2d at  14.   While this  is a
          ___________________________

          deferential  mode  of oversight,  the  standard  is not  entirely

          toothless; the court of appeals will find an abuse of discretion,
                              
          ____________________

               1Appellees  have not  cross-appealed the  denial of  fees in
          connection with the  FHA claim.  Therefore, the  district court's
          order has become final in that respect.

                                          5


and  set  aside the  underlying  order, "when  a  material factor

          deserving significant weight is  ignored, when an improper factor

          is  relied upon, or  when all proper and  no improper factors are

          assessed,  but  the court  makes  a serious  mistake  in weighing

          them."  Foster, 943 F.2d at  143, quoting Independent Oil & Chem.
                  ______                    _______ _______________________

          Workers of  Quincy, Inc. v.  Procter & Gamble Mfg.  Co., 864 F.2d
          ________________________     __________________________

          927, 929 (1st Cir. 1988).

          III.  ANALYSIS
          III.  ANALYSIS

                    Appellants advance two interrelated arguments in aid of

          their contention  that the  lower  court stumbled.   First,  they

          claim  that the trial judge  abused his discretion  by relying on

          the appellate panel's imposition of double costs as a dispositive

          factor  with respect  to whether  fees should  be awarded  in the
                                                                     ______

          district court.  Second,  they asseverate that the facts  of this
          ______________

          case  do not warrant a  fee award under 42 U.S.C.    1988 (or, at

          the  least, that  the judge  failed to  find facts  sufficient to

          underpin such an award).2

                                          A
                                          A
                              
          ____________________

               2In their brief, appellants also bemoan the district court's
          ostensible failure  to  consider  their  financial  condition  in
          imposing a  fee award.  Although  we have held that  "an award of
          attorney's  fees to a prevailing defendant  must not be oblivious
          of a  plaintiff's financial  capacity," Charves v.  Western Union
                                                  _______     _____________
          Tel.  Co.,  711  F.2d  462,  465  (1st  Cir.  1983),  appellants'
          _________
          importuning comes too late.  A party desirous of holding down the
          size of a fee award by reason of limited resources has the burden
          of  raising  the  point  in  a  timely  fashion  and   thereafter
          establishing his financial condition.  See Gibbs v. Clements Food
                                                 ___ _____    _____________
          Co., 949  F.2d 344, 345 (10th Cir. 1991).  In the district court,
          ___
          appellants disregarded these requirements.  Since it is our usual
          policy to  eschew consideration  of points not  seasonably raised
          below, see, e.g., Clauson  v. Smith, 823 F.2d 660,  666 (1st Cir.
                 ___  ____  _______     _____
          1987), we deem appellants to have waived the argument.

                                          6


In  civil  rights cases,  fee-shifting  in  favor of  a

          prevailing plaintiff  is the rule, whereas  fee-shifting in favor

          of  a  prevailing defendant  is the  exception.   Thus,  though a

          prevailing plaintiff is presumptively entitled to fee-shifting in

          such a  case, see, e.g., Hensley,  461 U.S. at 429,  a prevailing
                        ___  ____  _______

          defendant  is entitled  to  similar  largesse  only  if  she  can

          establish  that  the  plaintiffs'  suit  was  totally  unfounded,

          frivolous,  or otherwise  unreasonable, see  Hughes v.  Rowe, 449
                                                  ___  ______     ____

          U.S. 5, 14 (1980);  Christiansburg Garment Co. v. EEOC,  434 U.S.
                              __________________________    ____

          412, 421  (1978); Foster,  943 F.2d at  145-46.  The  court below
                            ______

          accurately rehearsed this standard in its  unpublished memorandum

          order.   But  the court  compressed into  a single  paragraph its

          discussion  of whether  appellants'  section 1983  claim sank  to

          these depths.  The court wrote:

                    In light of [Christiansburg and its progeny],
                                 ______________
                    no  relief  is  available  to  the defendants
                    unless  we find  that plaintiffs'  action was
                    frivolous.    Defendants'  attorneys  suggest
                    that the imposition  of double  costs on  the
                    owners  of  Casa  Marie   on  appeal  is   an
                    indication  of  the meritlessness  of [their]
                    action.   Although the  Court of  Appeals did
                    not explain its reasoning, we assume that the
                    imposition  of the  sanction of  double costs
                    reflects a finding that the case lacked merit
                    as to these particular plaintiffs.   See also
                                                         ___ ____
                    Eastway Constr.  Corp. v.  City of New  York,
                    ______________________     _________________
                    762 F.2d 243, 252 (2d Cir. 1985).

          After  writing this  paragraph,  the court  immediately  switched

          gears and began discussing why fee-shifting was not warranted  in

          connection  with the FHA claim.   Then, without  returning to the

          section  1983  claim or  offering  additional  insights into  its

          reasons  for pulling  the  trigger of  the  Fees Act,  the  court

                                          7


awarded  a sum  certain.  Thus,  when all  is said  and done, the

          district court made  specific mention  of only one  factor    the

          assessment of  double  costs  on  appeal    as  a  particularized

          justification for its fee award.

                    Appellants assail  the trial judge's  reliance on  this

          solitary factor as a bellwether for shifting fees in the district
                                                            _______________

          court.   They  advocate a bright-line  rule to the  effect that a
          _____

          trial court may  not consider an appellate court's  imposition of

          sanctions in determining frivolity for the purpose of a fee award

          in  favor of a prevailing defendant under  42 U.S.C.   1988.  Any

          such  consideration, they contend,  would contravene  the Supreme

          Court's  mandate that a district court  considering a fee request

          from a  prevailing defendant  should  "resist the  understandable

          temptation to engage in post hoc reasoning."  Christiansburg, 434
                                                        ______________

          U.S.  at 421-22.  The appellees also hawk a bright-line rule, but

          they  propose  drawing  the  line  at  a  much  different  angle.

          Specifically,  appellees would  have  us hold  that an  appellate

          court's  imposition of double costs is tantamount to a finding of

          frivolity, and that, therefore, it is always proper for the trial

          court  to  rely  on  such  an  impost  as  a  factor in  awarding

          attorneys' fees to a prevailing defendant.

                    To be sure,  bright lines are  sometimes useful in  the

          law.  But for all their seductive allure, they have a tendency in

          certain situations  to blind courts and lawyers to the subtleties

          inherent  in the problems to which they  are addressed.  So it is

          here.   We are wary  of the glare in  this context and  refuse to

8


adopt   either  of   the  bright-line   rules  proposed   by  the

          protagonists.

                    In lieu of  a rigid  rule, we prefer  to recognize  the

          relevant reality:   that the significance of an appellate court's

          dispensation   of   double   costs   to   the   district  court's

          determination  of frivolity  will vary  case by case.   Appellate

          sanctions are  appropriately awarded when an appellant prosecutes

          an  appeal "without  any realistic  hope  of prevailing."   Ochoa
                                                                      _____

          Realty Corp.  v. Faria, 815  F.2d 812, 818  (1st Cir. 1987).   In
          ____________     _____

          some situations,  a determination  that an appeal  was foredoomed

          may  bear  no  relationship  to   the  question  of  whether  the

          underlying  action  was  frivolous  when commenced.3    In  other

          situations,  however, a  determination that  an appeal  was taken

          against all odds may bear directly upon, or  at least inform, the

          district  court's judgment  as to  the frivolity  of the  suit ab
                                                                         __

          initio.4   To enable the  district court to  tell the difference,
          ______
                              
          ____________________

               3Consider  the example  of a  tort action  hinging  upon the
          credibility of witnesses and involving evaluative judgments about
          the care (or lack of care) exhibited by the protagonists.  Though
          such cases are  often fairly debatable  when brought (and,  thus,
          not frivolous), they may be so factbound that an appeal of a jury
          verdict  on liability might well be deemed frivolous.  See, e.g.,
                                                                 ___  ____
          Levesque  v. Anchor Motor Freight,  Inc., 832 F.2d  702 (1st Cir.
          ________     ___________________________
          1987); see  also La  Amiga del Pueblo,  Inc. v. Robles,  937 F.2d
                 ___  ____ ___________________________    ______
          689, 692  (1st Cir.  1991) (holding  that an  appeal from  a jury
          verdict  was frivolous  given  conflicting evidence  and lack  of
          preserved  objections,   although  the  trial   itself  may  have
          presented fairly debatable questions).

               4Consider a  case in which the district court grants summary
          judgment against a plaintiff and the appellate court, applying de
                                                                         __
          novo   review,  determines  that   the  plaintiff's   claims  are
          ____
          frivolous.  Such  a case  may well have  been totally  groundless
          when  brought, and  the appellate  court's conclusion  may inform
          that determination, especially if neither the known facts nor the

                                          9


the appellate court must furnish, or the record must adumbrate, a

          reasoned explanation of why the sanction was levied.

                    Assuming for argument's  sake that, as appellees  would

          have it,  the panel in Casa  Marie II intended double  costs as a
                                 ______________

          sanction,5  this action,  without  further explication,  sheds no

          light on the question  of whether appellants' section 1983  claim

          was unfounded or frivolous when originally raised in the district

          court.  Because the appellate panel  kept its own counsel and the

          record does not  suggest an  obvious reason for  its action,6  it

          follows  that  the district  court's  reliance  on the  appellate

          sanction as a proxy for  a finding of frivolity was improper.   A
                                                                          _

          fortiori, such  reliance cannot comprise  an adequate  substitute
          ________

                              
          ____________________

          law  changed materially  during the  pendency of  the litigation.
          See, e.g., Raskiewicz  v. Town of  New Boston, 754  F.2d 38  (1st
          ___  ____  __________     ___________________
          Cir.), cert. denied, 474 U.S. 845 (1985); see also Sierra Club v.
                 _____ ______                       ___ ____ ___________
          Secretary  of  Army,  820  F.2d   513,  518-20  (1st  Cir.  1987)
          ___________________
          (upholding district court award of fees under EAJA where district
          court, on remand,  had relied  on a prior  appellate decision  in
          making its determination that government's  original position was
                                                      ________
          not substantially justified).

               5In their  attack on the district  court's order, appellants
          assert that,  since the  panel  provided no  explanation for  the
          impost, it is at least  arguable that double costs were merely  a
          special  compensatory  assessment under  Fed.  R.  App. P.  39(a)
          rather than a sanction.   We find this argument  to be ingenious,
          but  not particularly persuasive.   In any event,  even if double
          costs  were intended as a  sanction, the district  court's use of
          the datum cannot stand.  See infra.
                                   ___ _____

               6Indeed, Casa Marie and its principals remained  in the case
          not of their own  volition, but because the district  court opted
          to  retain  jurisdiction   over  them   after  dismissing   their
          complaint.   See Casa Marie I, 752 F.  Supp. at 1161.  They filed
                       ___ ____________
          no notice of appeal, and to the extent they appeared at all, they
          appeared  as  appellees,  not   appellants,  in  Casa  Marie  II.
                                                           _______________
          Consistent  with this  circumscribed role,  they neither  filed a
          brief nor presented oral argument in this court.

                                          10


for the  concrete findings ordinarily demanded  as a prerequisite

          to a fee-shifting order.  See Peckham, 895 F.2d at 842.
                                    ___ _______

                                          B
                                          B

                    The  neighbors have one last string to their bow.  They

          maintain  that, putting to one side its misplaced reliance on the

          award of  double costs, the district court made enough additional

          findings to prop  up a conclusion  that appellants' section  1983

          claim  was frivolous when brought.  In this vein, appellees argue

          that the  district court's  cryptic citation to  Eastway, coupled
                                                           _______

          with  its earlier  allusion to the  fact that  appellants' claims

          originally  were dismissed on  res judicata  grounds,7 constitute
                                         ___ ________

          "findings" sufficient to ground the fee award.

                    We  do not  think  that the  district court's  rescript

          permits so generous  a reading.   While the  court's citation  to

          Eastway may perhaps hint that the  fee award was based in part on
          _______

          the  res  judicata bar  that  blocked  appellants' federal  court
               ___  ________

          action  from the  start,8  any such  indication is  substantially

          outweighed by  the fact that  the district court's  only explicit

          reference to  res judicata  actually cuts against  the neighbors'
                        ___ ________
                              
          ____________________

               7This is  by all  odds a  slender  reed.   The court  simply
          wrote, in describing the  travel of the case, that  "[t]he owners
          of  the facility were dismissed on res judicata grounds, but were
                                             ___ ________
          retained as necessary parties."

               8In  Eastway,  the  Second  Circuit  reversed  the  district
                    _______
          court's  denial of attorneys' fees to a prevailing defendant in a
          civil  rights  action, finding  it "particularly  noteworthy that
          [the plaintiff] had  already challenged the City's  policy in the
          state  courts,  and  had  been unsuccessful,"  and  stating  that
          "[t]hese  proceedings should  at  least have  put [plaintiff]  on
          notice of  the possibility  that its adversary  might be  awarded
          counsel fees."  762 F.2d at 252 (citation omitted).

                                          11


hypothesis that the res judicata dismissal provided the basis for
                              ___ ________

          the fee award.  We explain briefly.

                    The district  court gave  two reasons for  its decision

          not to bestow fees in connection with the FHA claim.   First, the

          Court  concluded  that it  could not  classify  the FHA  claim as

          frivolous  because "the  First Circuit  found that  [the district

          court] should have abstained in favor  of the state proceedings,"

          and, therefore,  made "no holding  on the  merits . .  . in  that

          claim."  Second, the court noted that, because appellants' claims

          in  federal court  were barred by  res judicata,  appellants were
                                             ___ ________

          only retained in  the action  as necessary parties.   Relying  on

          "these  reasons," the court denied counsel fees on the FHA claim.

          Thus,  it appears that the  district court used  the res judicata
                                                               ___ ________

          dismissal  of appellants' FHA  claim as  a justification  for not
                                                                        ___

          awarding  attorneys' fees  on that  claim.9  Presumably,  what is

          sauce for  the goose is also  sauce for the gander:   because the

          district court  dismissed appellants'  section 1983 claim  on the

          very same res judicata grounds, the record strongly suggests that
                    ___ ________

          the  court  could  not  have  believed  this  circumstance  as  a

          justification  for   a  fee  award.10     We  can   only  assume,

          therefore,  that  the  court   awarded  attorneys'  fees  to  the

                              
          ____________________

               9We  take  no  view  of  the  correctness of  this  holding.
          Rather, we  cite to  it in  an effort to  elucidate the  district
          court's thinking.

               10This  logic seems especially  compelling when one realizes
          that appellants' involuntary retention in the case was a sequelae
          not  only of the  dismissal of their  FHA claim, but  also of the
          dismissal of their section 1983 claim.

                                          12


neighbors on the section  1983 claim for some other  reason, say,
                                                        _____

          because the court of appeals awarded double costs.

                    We need not beat this drum too long or too loudly.  The

          crux of the matter  is not whether the district  court "could" or

          "might" have intended to give weight to the circumstances leading

          to the  res judicata dismissal  of the section 1983  claim.  What
                  ___ ________

          counts is that the record is fuliginous on this point.  Appellate

          review of a fee award must comprise more than a shot in the dark.

          When,  as now,  the  district court's  fee-shifting order  leaves

          critical questions unanswered, the order cannot stand.

                                          C
                                          C

                    Although the  district court's fee-shifting  order must

          be vacated, the course  of future proceedings is open  to debate.

          Appellants invite us  to decide  here and now  that no  plausible

          rendition  of the record will  sustain a fee-shifting  order.  We

          decline the invitation.   Once we  discount the district  court's

          improper reliance on  the earlier imposition of double  costs, we

          are left  to guess about the district court's thinking.  Here, as

          in Foster, plunging  ahead would be  tantamount to "usurping  the
             ______

          district court's  function, [and]  depriving  ourselves, and  the

          parties, of the insights of the judicial officer  most intimately

          familiar with the  case and its  nuances."   Foster, 943 F.2d  at
                                                       ______

          144.  We will not participate in such a speculative exercise.  

                    For these  reasons, we conclude that the course of both

          fairness and prudence is to remand  for further consideration of,

          and findings  appertaining to,  the application for  an award  of

13


fees in  respect  to the  section  1983 claim.    We intimate  no

          opinion as to appellees' entitlement vel non to such fees.
                                               ___ ___

Vacated and  remanded.    No fees  or  costs  shall  be
                    Vacated and  remanded.    No fees  or  costs  shall  be
                    _____________________     _____________________________

          awarded to  any party, under 42  U.S.C.   1988 or  otherwise, for
          awarded to  any party, under 42  U.S.C.   1988 or  otherwise, for
          _________________________________________________________________

          work in connection with this appeal.
          work in connection with this appeal.
          ___________________________________

14