Chaparro v. John Varvatos Enterprises, Inc.

Opinion

21-446-cv Chaparro v. John Varvatos Enterprises, Inc.

UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT=S LOCAL RULE 32.1.1.

WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

1 At a stated term of the United States Court of Appeals for the Second Circuit, held at the 2 Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 3 4th day of November, two thousand twenty-one. 4 5 Present: 6 DEBRA ANN LIVINGSTON, 7 Chief Judge, 8 REENA RAGGI, 9 GERARD E. LYNCH, 10 Circuit Judges. 11 _____________________________________ 12 13 LAURENTINA CHAPARRO, HILLARY T. CRANDLE, JOY 14 FUSARO, ALYSSA HICKEY, MARGRET HOLCOMB, 15 PAMELA KASSEN, TESSA KNOX, MICHELLE ORTIZ, 16 TRIPTI PANDEY, RUBY ROMERO, WIJDAN SHOUBAKI, 17 CHRISTINA TORRES, ARISSIA TOSSETTI, JENA 18 TOBACK, 19 20 Plaintiffs-Appellants, 21 22 SIRENA HERD, SYLVIA TAMAYO, KRISTEN JACKSON 23 GORRICHATEGIU, KARLA GOMEZ-NAVARRO, 24 25 Plaintiffs, 26 27 v. 21-446-cv 28 29 JOHN VARVATOS ENTERPRISES, INC., 30 31 Defendant-Appellee. 32 _____________________________________

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33 For Plaintiffs-Appellants: WILLIAM DUNNEGAN (Richard Weiss, on the brief), 34 Dunnegan & Scileppi LLC, New York, NY. 35 36 Appeal from a judgment of the United States District Court for the Southern District of

37 New York (Gorenstein, M.J.). 38 UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND 39 DECREED that the judgment of the district court is AFFIRMED. 40 Plaintiffs-Appellants Laurentina Chaparro, Hillary T. Crandle, Joy Fusaro, Alyssa Hickey, 41 Margret Holcomb, Pamela Kassen, Tessa Knox, Michelle Ortiz, Tripti Pandey, Ruby Romero, 42 Wijdan Shoubaki, Christina Torres, Arissia Tossetti, and Jena Toback appeal from a final 43 judgment entered against Defendant-Appellee John Varvatos Enterprises, Inc. (“Varvatos”) on 44 February 17, 2021, awarding Plaintiffs-Appellants, in relevant part, $748,321.21 in statutory 45 attorneys’ fees and costs to be paid by Varvatos and an additional $105,880.21 in attorneys’ fees 46 to be paid from the damages award allocated to punitive damages. 1 On appeal, Plaintiffs- 47 Appellants principally argue that: (1) the district court erred in failing to approve counsel’s 48 requested hourly rates; and (2) the district court erred in reducing counsel’s requested hours by 49 50%. We assume the parties’ familiarity with the underlying facts, the procedural history of the 50 case, and the issues on appeal. 51 * * * 52 We review a district court’s award of attorneys’ fees for abuse of discretion. McDaniel 53 v. County of Schenectady, 595 F.3d 411, 416 (2d Cir. 2010). An abuse of discretion occurs “when 54 (1) [the court’s] decision rests on an error of law (such as application of the wrong legal principle) 55 or a clearly erroneous factual finding, or (2) its decision—though not necessarily the product of a

1 Varvatos notified the Court in a letter dated April 5, 2021 that it would not be participating in the appeal.

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1 legal error or a clearly erroneous factual finding—cannot be located within the range of permissible 2 decisions.” Vincenty v. Bloomberg, 476 F.3d 74, 83 (2d Cir. 2007) (quoting Mastrovincenzo v. 3 City of New York, 435 F.3d 78, 88 (2d Cir. 2006)). “Given the district court’s inherent 4 institutional advantages in this area, our review of a district court’s fee award is highly deferential.” 5 McDonald ex rel. Prendergast v. Pension Plan of the NYSA-ILA Pension Tr. Fund, 450 F.3d 91, 6 96 (2d Cir. 2006) (per curiam). “As a general rule, so long as the district court has applied the 7 correct criteria, its decision will withstand scrutiny.” Mautner v. Hirsch, 32 F.3d 37, 39 (2d Cir. 8 1994); see Hensley v. Eckerhart, 461 U.S. 424, 437 (1983) (noting “the district court’s superior 9 understanding of the litigation and the desirability of avoiding frequent appellate review of what 10 essentially are factual matters”). 11 I. Reduction in Hourly Rate 12 We first reject Plaintiffs-Appellants’ challenge to the district court’s determination of the 13 reasonable hourly rate. We award attorneys’ fees according to the “presumptively reasonable 14 fee” method, calculated as the product of the reasonable number of hours worked and a reasonable 15 hourly rate. Arbor Hill Concerned Citizens Neighborhood Ass’n v. Cnty. of Albany & Albany 16 Cnty. Bd. of Elections, 522 F.3d 182, 183–84 (2d Cir. 2008), as amended (Apr. 10, 2008). “[T]his 17 Court has instructed that determination of a reasonable hourly rate ‘contemplates a case-specific 18 inquiry into the prevailing market rates for counsel of similar experience and skill to the fee 19 applicant’s counsel,’ an inquiry that may ‘include judicial notice of the rates awarded in prior cases 20 and the court’s own familiarity with the rates prevailing in the district.’” Townsend v. Benjamin 21 Enters., Inc., 679 F.3d 41, 59 (2d Cir. 2012) (quoting Farbotko v. Clinton County, 433 F.3d 204, 22 209 (2d Cir. 2005)). In Arbor Hill, we emphasized that “[t]he reasonable hourly rate is the rate a 23 paying client would be willing to pay . . . bear[ing] in mind that a reasonable, paying client wishes

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1 to spend the minimum necessary to litigate the case effectively.” 522 F.3d at 190. “In 2 determining what rate a paying client would be willing to pay, the district court should consider, 3 among others, the Johnson factors.” Id. 2 4 Reviewing recent Southern District cases awarding attorneys’ fees, the district court first 5 concluded that “there are effective attorneys at lower prices [than those sought by Plaintiffs- 6 Appellants] for experienced litigators.” Knox v. John Varvatos Enters. Inc., 520 F. Supp. 3d 331, 7 342 (S.D.N.Y. 2021); see also Simmons v. N.Y.C. Transit Auth., 575 F.3d 170, 174 (2d Cir. 2009) 8 (“According to the forum rule, courts should generally use the hourly rates employed in the district 9 in which the reviewing court sits in calculating the presumptively reasonable fee.” (citations and 10 internal quotation marks omitted)). This conclusion was amply supported by recent Southern 11 District cases considering the prevailing rate in the district. See, e.g., Chuk On Chan v. Good 12 Chows Inc., No. 16-CV-02794 (RJS)(SN), 2017 WL 9538901, at *7 (S.D.N.Y. Mar. 3, 2017) 13 (“Courts in this District have determined that a fee ranging from $250 to $450 per hour is 14 appropriate for experienced civil rights and employment law litigators.” (citations omitted)).

2 The Johnson factors are outlined in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 717–19 (5th Cir. 1974), abrogated on other grounds by Blanchard v. Bergeron, 489 U.S. 87, 92– 93, 96 (1989). The Fifth Circuit identified the following factors as relevant to fee calculations:

the time and labor required; (2) the novelty and difficulty of the questions; (3) the level of skill required to perform the legal service properly; (4) the preclusion of employment by the attorney due to acceptance of the case; (5) the attorney’s customary hourly rate; (6) whether the fee is fixed or contingent; (7) the time limitations imposed by the client or the circumstances; (8) the amount involved in the case and the results obtained; (9) the experience, reputation, and ability of the attorneys; (10) the ‘undesirability’ of the case; (11) the nature and length of the professional relationship with the client; and (12) awards in similar cases.”

Arbor Hill, 522 F.3d at 186 n.3.

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1 The district court further referenced case-specific factors in its determination of an 2 appropriate hourly rate. The court expressly noted “that this case involved novel issues of law, 3 that both sides prosecuted the matter zealously, and that the stakes involved were high.” Knox, 4 520 F. Supp. 3d at 342. It placed great emphasis on “the fact that the performance of the 5 plaintiffs’ attorneys in the courtroom and the quality of the papers they filed with the Court was 6 extraordinary.” Id.; see Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542, 553 (2010) (reaffirming 7 that “the novelty and complexity of a case generally may not be used as a ground for an 8 enhancement” because these factors are presumably reflected in the reasonable hourly rate and 9 requested hours). But it also considered that “the litigation of this case has positioned counsel to 10 demonstrate expertise in class action and employment law that did not exist before.” Knox, 520 11 F. Supp. 3d at 342–43. Under these circumstances, the district court did not abuse its discretion 12 in setting rates that were well within, or at the high end of, the prevailing rate for attorneys of like 13 skill and experience in the Southern District. See Fisher v. Aetna Life Ins. Co., No. 16-CV-144 14 (RJS), 2020 WL 5898788, at *9 (S.D.N.Y. Oct. 5, 2020) (approving requested rates of $450 for 15 Dunnegan, $225 for Weiss, and $165 for Chung in employee benefits case). 16 II. Reduction in Hours 17 We likewise reject Plaintiffs-Appellants’ challenge to the district court’s determination of 18 the reasonable hours expended during the litigation. Plaintiffs-Appellants primarily argue that 19 the district court erred in comparing their requested hours to those approved in more routine cases, 20 rather than those billed by Varvatos’ attorneys. When reviewing a fee application, a district court 21 should “examine[] the particular hours expended by counsel with a view to the value of the work 22 product of the specific expenditures to the client’s case,” and if it “concludes that any expenditure 23 of time was unreasonable, it should exclude these hours” from the fee calculation. Luciano v.

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1 Olsten Corp., 109 F.3d 111, 116 (2d Cir. 1997) (citations omitted); Hensley, 461 U.S. at 434–35 2 (holding that only those hours “reasonably expended” should be awarded). In dealing with hours 3 that are “excessive, redundant, or otherwise unnecessary, . . . the court has discretion simply to 4 deduct a reasonable percentage of the number of hours claimed as a practical means of trimming 5 fat from a fee application.” Kirsch v. Fleet St., Ltd., 148 F.3d 149, 173 (2d Cir. 1998) (citations 6 and internal quotation marks omitted). 7 Here, the district court acted well within its discretion in reducing Plaintiffs-Appellants’ 8 claimed hourly total by 50%. The court concluded that some of Plaintiffs-Appellants’ excessive 9 hours were “undoubtedly attributable to the attorneys’ utter lack of experience in either class 10 actions or employment litigation.” Knox, 520 F. Supp. 3d at 346; see Hensley, 461 U.S. at 438 11 n.13 (approving the district court’s 30% reduction of an attorney’s requested hours, in part, “to 12 account for [the attorney’s] inexperience”). The court also properly compared the hours sought 13 by Plaintiffs-Appellants to those awarded in other employment discrimination suits. Knox, 520 14 F. Supp. 3d at 346; see Cabrera v. Fischler, 814 F. Supp. 269, 289 (E.D.N.Y 1993), aff’d in 15 relevant part sub nom. Cabrera v. Jakabovitz, 24 F.3d 372 (2d Cir. 1994) (finding unreasonable 16 the 4,800 attorney hours and 1,500 paralegal hours claimed by plaintiffs when, in a similar case, 17 counsel sought to recover for 2,359.75 hours of work performed over the course of nine years). 18 Although Plaintiffs-Appellants argue that it was inappropriate for the district court to compare the 19 present case with single-plaintiff discrimination suits, they did not provide the district court with 20 any class action cases to which the hours expended on this case could be compared. In any event, 21 class actions are not categorically more complex than individual actions, and the district court 22 appropriately considered the nature of the case as a class action lawsuit when formulating the 23 award. See Knox, 520 F. Supp. 3d at 347. On the record before us, we cannot conclude that the

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1 district court abused its discretion in applying a 50% reduction to the claimed hours. See Kirsch, 2 148 F.3d at 173. 3 * * * 4 We have considered Plaintiffs-Appellants’ remaining arguments and find them to be 5 without merit. Accordingly, we AFFIRM the judgment of the district court. 6

7 FOR THE COURT: 8 Catherine O’Hagan Wolfe, Clerk of Court