Great moments in attorney fee requests

by Walter Olson on January 26, 2014

Judge Frank Nervo in Manhattan used phrases like “simply intolerable” and “gross overreaching” in denying Mayer Brown’s “request for more than $126,000 in attorneys’ fees in a lawsuit over a $6,400 security deposit. Judge Nervo added that the firm spent ‘a grossly unnecessary amount of time’ on simple tasks, including ‘research on the most basic and banal legal principles.’” [Clozel v. Jalisi, Above the Law]

{ 9 comments }

1 asdfasdf 01.27.14 at 12:58 am

The decision to deny attorneys fees does not make much sense on its face, http://www.scribd.com/doc/201447781/Clozel-v-Jalisi .

For example, the judge complains that on February 15, 2012 counsel “Researched…Civil Court procedural rules and pleadings requirements; researched New York law regarding security deposits and Real Estate licensing; drafted New York City Civil Court complaint seeking recovery of security deposit” at 4.5 hours.

The court stated that “these are legal matters about which counsel is presumed to know and tasks that, even were they necessary, could have been performed within minutes.”

The court’s arguments are nonsense here, for two simple reasons:

First, noone knows all the laws and court rules. Spending some time checking the laws (and presumably the common law and the precedents), as well as court procedures, is something lawyers do, and it can take time. There are very few laws I can even imagine researching in “minutes” like the court claims, in a common law society anyway.

Second and more important, the court here ignores that part of the billing is for drafting a complaint. A complaint cannot usually be drafted “within minutes”.

It’s true that if the attorney already knew all the law, precedents and court rules, maybe he could have done all this in minutes. But drafting a complaint takes a lot longer. Isn’t this the site that always complains about cookie-cutter complaints that are not proof-read or tailored to the facts of the case? You can’t have your cake and eat it too: if you object to overbroad complaints, you cannot also support a judge who believes a complaint can be drafted in “minutes”.

I don’t know the underlying facts here except that the landlord did pay treble damages for failing to return a security deposit. If in fact the landlord wrongly failed to return the deposit, why should the tenant (or his lawyers) have to eat the time or costs associated with its recovery?

2 Walter Olson 01.27.14 at 1:34 am

Actually, a demand for return of a security deposit strikes me as exactly the sort of complaint for which boilerplate language used in earlier cases, and very likely downloadable at low or no cost, might be well suited. But if these are the principles by which you approve paying the bills your lawyers send you, far be it from me to try to change your mind.

3 asdfasdf 01.27.14 at 1:48 am

As I said, I don’t know the underlying facts here.

But I do know it’s not a “demand for return of a security deposit”; since it’s a complaint for one thing, not a demand; and since moreover the plaintiff got a minimum of treble damages already plus attorneys fees.

We also have no reason to think that this complaint could have been met by “boilerplate language”. And there is some reason to think it was not a boilerplate case: if it was, the judge, who is obviously fishing for reasons to deny the attorneys fees, would have mentioned this.

Not having seen the underlying case and not being a New York real estate attorney I cannot speak to the underlying complexity of the case. I can only state what anyone reading the judge’s reasoning denying attorneys would conclude: the judge’s reasoning is nonsensical.

All you are claiming basically is that there might be other facts not mentioned in the judge’s opinion that would justify denying the attorneys fees, which might or might not be so. But I don’t see how you can defend the logic of the judge’s reasoning (that researching the law and drafting a complaint in and of itself should take only minutes).

4 William Nuesslein 01.27.14 at 5:34 am

Good Grief, $126.000 is more than twice my family’s yearly income. Such overcharging is a slap in the face to those like my wife who work hard for her living. An arbitration clause would have helped.

5 PaulB 01.27.14 at 2:04 pm

Since Mayer Brown handled this case as favor for an important client (the tenant was a cousin of his) and had no intention of being paid by the tenant in this case, then why shouldn’t “recovery of attorney’s fees” be set at zero?

6 asdfasdf 01.27.14 at 11:04 pm

Have you people actually read the judge’s decision? It reads more like a de Blasio press release than a legal opinion to me. It’s a telling state of affairs that even in this nominal right-leaning blog the reasoning in that decision seems to be lauded.

Anyway, to answer one of those other commenters there are two reasons to shift attorneys fees here.

First, the parties signed a contract to do it, and judges should respect sanctity of contract, or at least, they used to respect it.

Second, without such fee-shifting, tenants have no incentive to try and recover security deposits: it would be too expensive to sue to do so (in most cases). Without fee-shifting, landlords would be incentivized to always withhold security deposits. This in turn puts honest landlords at a competitive disadvantage.

ABA blog commenters on this case reported that the landlord here engaged in dilatory tactics, like evasion of service of process, to drive up the cost of recovery, http://www.abajournal.com/news/article/judge_says_biglaw_firm_sought_fees_for_research_on_basic_and_banal . If true, this is precisely what one would expect in a non-fee-shifting regime by the way, and one of the things fee-shifting is designed to curtail.

7 Bill Poser 01.28.14 at 12:18 am

Supposing that the judge is right, has the law firm not engaged in fraud in submit a bill for hours that actually worked, which would warrant a bar referral and/or criminal prosecution?

8 Doug 01.28.14 at 10:03 am

the bill was way too high for the amount of the demand. Way too high.

9 eero iloniemi 01.28.14 at 10:40 am

If, as some here seem to claim, this was a reasonable fee should we then assume that whoever handled this case, infomed his collegues that he was taking a 125 K pro bono case? After all, there is always the risk that the judgement could have gobe the other way.

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