Real Estate Bar Ass'n for Massachusetts, Inc. v. National Real Estate Information Services

642 F. Supp. 2d 58, 2009 U.S. Dist. LEXIS 72274
District Court, D. Massachusetts·Decided August 17, 2009·No. Civil Action 07-10224-JLT·Published·Cited by 3 cases

Opinion

MEMORANDUM

TAURO, District Judge.

I. Introduction

Presently at issue is Defendants National Real Estate Information Services and National Real Estate Information Services, Inc.’s (collectively “NREIS”) Motion for Attorneys’ Fees and Costs Pursuant to 42 U.S.C. § 1988. For the following reasons, NREIS’s Motion is ALLOWED.

II. Background

Plaintiff The Real Estate Bar Association for Massachusetts, Inc. (“REBA”) brought this action claiming that NREIS had engaged in the unauthorized practice of law in Massachusetts by performing real estate conveyances, conducting so-called “notary closings,” and issuing title insurance. NREIS counterclaimed under 42 U.S.C. § 1983 that REBA’s interpretation of the practice of law, and enforcement of that interpretation, violated the Dormant Commerce Clause of the U.S. Constitution. This court explained the relevant facts in greater detail in its April 13, 2009 Memorandum, 1 which allowed NREIS’s Motion for Summary Judgment and Motion for Summary Judgment on Dormant Commerce Clause Counterclaim, and denied REBA’s Motion for Summary Judgment. 2 NREIS filed the pending Motion on April 27, 2009, and this court held a hearing on the Motion on August 12, 2009. 3 NREIS now seeks $904,076.17 in attorneys’ fees and costs, 4 plus a risk factor enhancement. 5

III.Discussion

A. Qualification for Attorneys’ Fees and Costs Under 42 U.S.C. § 1988

A district court may, in its discretion, award reasonable attorneys’ fees to the prevailing party on a § 1983 claim. 6 A prevailing party is one who has “succeeded] on any significant issue in litigation which achieves some of the benefit the *64 parties sought in bringing suit.” 7 In other words, a party prevails “when the actual relief on the merits of his claim materially alters the legal relationship between the parties by modifying defendant’s behavior.” 8

REBA denies that NREIS is the “prevailing party” on its Dormant Commerce Clause counterclaim, arguing that this court rejected REBA’s interpretation of Massachusetts law and thus rendered any subsequent decision on the Dormant Commerce Clause counterclaim advisory and insufficient to alter the legal relationship between REBA and NREIS. But this court did not define the practice of law in Massachusetts, in favor of REBA’s interpretation or otherwise. 9 The “judicial branch of government has exclusive power to determine what constitutes the practice of law,” 10 and the Massachusetts Supreme Judicial Court (“SJC”) “has addressed [this question] on a case-by-case basis.” 11 REBA is authorized as a Massachusetts bar association to enforce the commonwealth’s unlawful practice of law statute 12 and, relying largely on the SJC case In re Opinion of the Justices, has acted to enforce that statute against NREIS. REBA’s actions to enforce its interpretation of the practice of law placed NREIS’s Dormant Commerce Clause rights and the First Circuit’s opinion in National Revenue Corp. v. Violet 13 squarely at issue.

Holding that REBA violated the Dormant Commerce Clause, and issuing a permanent injunction in NREIS’s favor, resulted in a material alteration of Parties’ legal relationship. REBA is now “enjoined from enforcing on NREIS its interpretation of the practice of law as encompassing (1) all the interconnected activities of a real estate conveyance and (2) the issuance of title insurance.” 14 An injunction that bars one party from taking action against another party amounts to a material alteration of the parties’ relationship, 15 and a court may award attorneys’ fees if injunctive relief was issued to remedy a Commerce Clause violation. 16 Having prevailed on the merits of its Dormant Commerce Clause counterclaim, and secured a permanent injunction in its favor, NREIS is undeniably the prevailing party.

Though the language of § 1988 provides the court with discretion to de *65 cide whether to allow attorneys’ fees and costs, “awards in favor of prevailing civil rights plaintiffs are virtually obligatory.” 17 The prevailing party “should ordinarily recover an attorney’s fee unless special circumstances would render such an award unjust.” 18 The nonprevailing party has the burden of showing such “narrowly circumscribed” special circumstances, which include “outrageous or inexecusable conduct on the part of the plaintiff or its counsel,” “bad faith or obdurate conduct,” or “an unjust hardship that a grant or denial of fee shifting might impose.” 19 REBA’s contentions that allowing attorneys’ fees and costs in this case would chill constitutionally protected activities or contradict the purposes of § 1988 fail to satisfy “these stringent criteria.” 20

Given that NREIS is the prevailing party and that REBA has not shown any legally recognized special circumstances, NREIS qualifies for an award of reasonable attorneys’ fees and costs.

B. Calculation of Attorneys’ Fees and Costs

The court employs a two-step process to determine the reasonable fees. First, “the number of hours reasonably expended on the litigation [is] multiplied by a reasonable hourly rate” to reach the “lodestar” figure. 21 Second, the court may adjust “the reasonable fee upward or downward if any special factors dictate such a result.” 22

1. Lodestar Figure

a. Number of Hours

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Real Estate Bar Ass'n for Massachusetts, Inc. v. National Real Estate Information Services, 642 F. Supp. 2d 58, 2009 U.S. Dist. LEXIS 72274 (D. Mass. 2009).

642 F. Supp. 2d 58 (Real Estate Bar Ass'n for Massachusetts, Inc. v. National Real Estate Information Services) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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