I know there are appellate junkies out there. Some of you may even practice in the Court of Appeals. If you do, this case answers a question that few of us had even asked before.
The case is Hines v. City of Albany, decided on July 6. In this Section 1983 case, the plaintiff claimed the City had illegally seized and retained his SUV. The district court granted summary judgment for the plaintiff on the seizure claim. This is unusual. Normally, the defendants win summary judgment, not the plaintiff. So the City appealed from that ruling, and the Second Circuit affirmed. This all happened in 2011-2013. After plaintiff won the appeal, his attorneys moved for attorneys' fees arising from the appeal. These fees are recoverable. Defending a plaintiff's judgment in a Section 1983 case takes time and effort, and the fee-shifting statute governing these cases applies beyond the district court.
Here's the problem. After upholding summary judgment in favor of the plaintiff, the Court of Appeals said that each party would bear its own costs respect to the appeal. What does this mean? Plaintiff said that it only means that defendant was not obligated to pay the out-of-pocket costs associated with prosecuting the appeal, i.e., the cost of printing up the briefs and appendix, which can be sizable. Defendant said this means that it does not have to pay the attorneys' fees, which can be exponentially higher than the out-of-pocket costs. In this case, the appellate fees amounted to over $13,000. The district court on remand denied plaintiff's application for those fees, concluding that the Court of Appeals wanted that result in stating that each side would bear its own costs on appeal.
The Court of Appeals (Lohier, Livingston and Rakoff [D.J.]) sides with plaintiff on this, and his lawyers get their attorneys' fees from that appeal, and presumably this appeal as well. Other Circuits have already reached this conclusion.
The Second Circuit runs through what it means to pay costs and how costs fall into a different category as attorneys' fees. But apart from the dry analysis drawing from Federal Rules, the Second Circuit also considers policy reasons, noting that the fee-shifting law allows civil rights plaintiffs to bring their cases even if they have no money, as their lawyers will have an economic incentive to pursue these claims in the knowledge that if they win, the defendant pays their fees. Without that incentive, few people would actually bring their civil rights claims to court. "Prevailing parties under Section 1988 [the fee-shifting] law are therefore entitled to recover a reasonable fee for preparing a defending a fee application. That includes attorneys' fees incurred as a result of appeals related to the defense of a fee award." While the Circuit notes that fees litigation should not turn into a second major litigation, it concludes that "plaintiffs were entitled to attorneys' fees on appeal under Section 1988 even though it was their third fee application."