A big part of defending any wage hour case and settling such a case is the issue of attorneys’ fees for the plaintiff’s lawyer. Plaintiff attorneys are always having grandiose notions of what they are entitled to and these issues often become the deal breaking issue of the litigation. Well, maybe us defense lawyers are (finally) getting some relief from the courts. A federal appellate court has just shot down a request for an absurd amount of legal fees based on a very small recovery for the plaintiffs. The lawyers sought $120,000 in attorney fees following what the Court dubbed a “limited success” for the clients, i.e. a wage recovery of less than $7,000. The case is entitled Weigang Wang et al. v. Chapei LLC and issued from the Third Circuit Court of Appeals.
The appellate court affirmed the lower court’s ruling that the plaintiff lawyers could not shift the burden of who pays their fees to the defendant employer. As the panel aptly observed, “fee-shifting statutes can be abused by attorneys who over-litigate a case once they have confidence that their client will receive an award — no matter how small. Here, where the result was very limited success for the clients, and where the deficiencies identified by the district court compromised a meaningful review of the claimed fees under the lodestar method, it was not an abuse of discretion to deny fees altogether.”
The plaintiffs had sued for overtime and sought almost $200,000 in damages. There was a bench trial after which the court awarded them approximately $7000 for their claims. The lower court declined, however, to award any attorney fees. The Third Circuit agreed with the lower court, ruling that the court was “fully within its discretion” to deny the request for an attorney fee award that would have equaled about eighteen times more than what their clients received.
The Court also found several glaring mistakes in the fee petition. It held that “the declaration that accompanied the fee petition referred more to the plaintiff in [a] prior default judgment case than to the actual plaintiffs in this case. Moreover, one of the attorneys had misstated his $350 hourly rate as $3550 Most troubling was that one of the attorneys failed to provide a detailed bill for his time.”
As the defense lawyer so eloquently put it, “the Third Circuit’s ruling is a wakeup call to the plaintiff’s bar. There is no silver bullet for the plaintiff’s lawyers to always obtain significant attorney’s fees in wage-and-hour litigation.” I have settled cases where the plaintiff lawyers spend fifteen minutes settling the wage portion of the case and then argue five hours over their fee demands. This decision should send a message to plaintiff lawyers not to think that every time they undertake a wage hour litigation, there will be a slot machine paying off oodles of money in their fees.
Sometimes you go bust…