Wednesday, February 1, 2017

Fee Awarded In Indian Trust Fund Litigation

 An interesting decision yesterday in a notable case by Magistrate Judge G. Michael Harvey of the United States District Court for the District of Columbia

Herein the Court will close what may be the final major dispute in two decades of hard-fought litigation. Plaintiffs, Native Americans whose lands were held in trust by the Department of the Interior, sought to remedy a century of wasteful trust mismanagement. They obtained a stunning victory which brought about trust reform and a significant recovery for the plaintiff class. Helping them in their quest was a team of attorneys whose dedication and tenacity deserve high commendation. One of those attorneys was Mark Brown. After this case settled in 2009, Plaintiffs’ counsel moved for an award of attorney’s fees and costs. Brown was omitted from the motion, as were the hours he spent litigating this matter. He now petitions this Court for his share of the fee award.

The opinion paints a picture of co-counsel working relationships in the Cobell litigation that ran the gamut from strained to toxic.

Brown also had a strained relationship with the Special Master appointed by Judge Royce Lamberth that was not helped by his asking the Special Master whether he suffered from "early onset Alzheimer's."

Then there was the "crying fish" footnote.

In another instance, Brown assisted in drafting a brief in support of a motion for attorney’s fees made to the Special Master. In one of the brief’s footnotes, Brown included a picture of a crying fish. This image was intended to lampoon the government for its complaints that class counsel’s fees were excessive. [Co-counsel] Gingold told Brown to remove the picture before filing the brief, but Brown insisted that it be included. Brown counters that Gingold “specifically asked it to be left in.”  The image was left in. Gingold testified that the Special Master became quite upset upon seeing the image. In his decision on the motion for fees, the Special Master noted the presence of a “fish shedding a tear” in Plaintiffs’ brief. He ultimately deducted 75% of all the time spent preparing the brief. (record citations omitted)

Eventually, the plaintiff's team concluded that life was better without Brown.

The circumstances and cause of his departure were the focus of this fee dispute.

The court

Plaintiffs argue that, if Brown withdrew from the litigation, it was unjustified, and if he did not withdraw, he was terminated for cause. Cobell F&C at 46 ¶ 10, 49 ¶ 17. As discussed above, either finding would eliminate Brown’s recovery entirely under District of Columbia law. Brown responds that he did not withdraw, but rather was terminated without cause, and therefore is entitled to recovery of his fees. Brown Reply at 77 ¶ 7.

The Court ultimately sides with Brown and finds that he is entitled to an award of reasonable fees for his work on this case, although the undersigned does not adopt his reasoning to reach this conclusion. Despite Brown’s belief to the contrary, the Court finds that he withdrew from the Cobell litigation in January 2006. Further, although the terms of Brown’s engagement letter with the Plaintiffs do not make a withdrawing attorney’s compensation contingent on his or her departure being for good cause, the Court in any event finds that Brown was justified in leaving the Cobell team when he did. His withdrawal also did not result in any prejudice to his clients who were ably represented by a veritable army of attorneys at the time of his departure. Nor, under the unique facts of this case, did it represent a clear and serious violation of any ethical duty he owed to Plaintiffs. He is therefore entitled to an award of reasonable fees.

On that score, however, Brown’s petition for more than $5 million in fees is lacking. The billing rate he seeks is in excess of that stipulated in his engagement letters with Plaintiffs. Further, significant cuts are in order to the hours he presents, given that his time records are larded with many hours that were either previously compensated or deemed unreasonable by a judicial officer, or reflect unnecessary work or clerical tasks not reasonably billed at an attorney’s rate. Most importantly, an overall reduction of his time is in order because he did not exercise billing judgment when he reviewed his records prior to submitting them to the Court. After all deductions are applied, the Court concludes that Brown should be awarded $2,878,612.52 for his work representing the plaintiff class prior to his withdrawal.

As to good cause to withdraw

 The Court finds that Brown’s withdrawal met this standard. While the conduct of all parties leading up to Brown’s departure in January 2006 is deserving of some reproach, on balance the evidence shows that Brown’s withdrawal was not unjustified. By that time, the relationship between Brown and his co-counsel was irretrievably broken. Further, following Brown’s May 2005 suspension, the record supports Brown’s contention that he was "frozen out" of work on the case. Brown Ex. 14; Brown Reply at 33 ¶ 59. For the next six months, Brown had little or nothing to do. 4/20 P.M. Tr. 145:5–9; 4/21 Tr. 33:11–34:19. He sought assignments from those few individuals with whom Gingold allowed him to work, but, after a few projects, that work dried up as well. 4/21 Tr. 31:25–32:19. Plaintiffs claim that Brown may have received more work had he repeatedly requested it. 4/22 Tr. 211:20–212:2. It is undisputed, however, that he asked for work, and received little to none. This is not surprising; it is a fair inference from the record that, fol-lowing lead class counsel Gingold’s suspending him from working with anyone but a few attorneys, Brown was effectively persona non grata on the Cobell team. There was clearly much work to be done during that period on behalf of the Plaintiffs, and Brown was willing to do it—indeed, it was never Plaintiffs’ complaint that Brown was not hard working on their behalf. Nevertheless, no assignments were forthcoming.

The court further concluded that Brown's withdrawal sufficiently complied with his ethical obligations under Rule 1.16.  

There is no evidence in the record that Brown’s absence had any material adverse effect on Plaintiffs or their claims.

Indeed, Brown was a divisive figure on the Cobell team. Far from prejudicial, his departure was viewed as advantageous by Plaintiffs’ other counsel, and thus it indirectly benefited the plaintiff class. Gingold testified that suspending Brown “eliminated the risk of harm” to the trial team since he was perceived as source of friction on the Cobell team. Certainly, Brown’s co-counsel were not unhappy to see him go. However long after January 2006 it took them to realize that he was not returning from California, none of them felt inclined to question the change in his status. The litigation proceeded to its successful conclusion undisturbed by his absence. (citations to record omitted)

These facts distinguish the cases cited by Plaintiffs in which the withdrawing attorneys were found to be in violation of their professional obligations. In each of those cases, the attorneys knowingly left their clients in the lurch without other representation...

Indeed, on this point, the zeal with which Plaintiffs’ counsel seeks to expose Brown’s purported ethical lapses would be more persuasive if the end result served something other than their own financial gain. Again, under the unique facts of this case, every dollar not awarded to Brown will pass not to Brown’s clients but to his former colleagues at Kilpatrick Stockton...

 Rule 1.16 was designed as a shield to protect an unwary client when an attorney withdrawals, not as a sword to financially benefit the client’s other counsel.

While the Court does not condone the failure of a withdrawing attorney to put either his client or the Court on proper notice prior to his withdrawal, nevertheless, based on the peculiar facts of this case, the Court finds that any such lapse here is not a sufficient basis to deny Brown the compensation he earned in the six years prior.

Thanks to a reader for sending this to us. (Mike Frisch) 

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