DATE: June 3, 1994
CASE NO. 90-STA-37
IN THE MATTER OF
RALPH B. CLAY,
COMPLAINANT,
v.
CASTLE COAL AND OIL COMPANY, INC.,
RESPONDENT.
BEFORE: THE SECRETARY OF LABOR
FINAL DECISION AND ORDER
This case arises under Section 405 of the Surface
Transportation Assistance Act of 1982 (STAA), 49 U.S.C. app.
§ 2305 (1988). Before me for review is the Recommended
Decision and Order upon Remand from the Secretary of Labor (R.D.
and O.) issued on February 28, 1994, by the Administrative Law
Judge (ALJ). At issue is the relief appropriately awarded
Complainant to remedy the effects of Respondent's unlawful
discrimination.
1. Back pay
The ALJ has found Complainant entitled to lost regular or
"straight-time" pay. The ALJ computed this pay by multiplying
the regular hourly rate by an eight-hour work day and a five-day
workweek for the two-year back pay period.
Respondent argues that the ALJ has overstated the number of
hours by assuming that Complainant "would have worked 40 hours
every week of the year," and points to Complainant's work history
and to the histories of several drivers which show that they did
not work the maximum possible hours. [1] Resp. Br. on Relief
at 5-7. The disparity is not great, however. Since, as a full-
time employee scheduled to work at least an eight-hour workday,
[PAGE 2]
Jan. 24-25, 1992, Hearing Transcript (T.) 376 (Dispatch Manager
Jusas), Complainant conceivably could have worked each workweek
in its entirety or near entirety, I am unwilling to speculate on
the amount of any reduction. Back pay awards are, at best,
approximate and any "uncertainties in determining what an
employee would have earned but for the discrimination should be
resolved against the discriminating employer." Pettway v.
American Cast Iron Pipe Co., 494 F.2d 211, 260-261 (5th Cir.
1974). Accordingly, I adopt the ALJ's computation.
The ALJ also found Complainant entitled to lost overtime pay
by estimating that Complainant would have worked 8.5 hours of
regular overtime each workweek. R.D. and O. at 6. The ALJ
extrapolated the number of hours from Complainant's final two
quarters of employment with Respondent. Id. (first full
paragraph (par.)). In particular, the ALJ examined the final
quarter of 1989 (October - December) and the first quarter of
1990 (January - March). Respondent argues that the ALJ's method
overstates the yearly overtime hours because Respondent's
seasonal business, the delivery of heating oil, peaked during the
winter months examined by the ALJ in extrapolating his average
hours. Resp. Br. on Relief at 7-8. According to Complainant,
however, the 1989-1990 winter was uncharacteristically mild, and
less overtime than usual was available. T. 197-198. Respondent
argues further that overtime calculations should be premised on
the overtime actually worked by Complainant during the three-year
period preceding his discharge (1987-1989). Resp. Br. on Relief
at 8. That period, however, is unrepresentative of overtime that
Complainant would have worked during the 1990-1992 back pay
period because shortly before the discharge Respondent agreed to
increase Complainant's weekday overtime in addition to continuing
his Saturday overtime assignments. T. 197-198, 333.
A comparison of the ALJ's calculations with the overtime
hours actually worked during 1990 and 1991 by three other
comparable drivers persuades me that the calculations are
reasonable. Complainant's 68 overtime hours worked in 1990 prior
to his discharge added to the projection (46 remaining weeks
multiplied by 8.5 hrs/wk) totals 459 overtime hours. The
projection for 1991 (52 weeks multiplied by 8.5 hrs/wk) totals
442 overtime hours. These projections compare favorably with
overtime hours worked by Drivers Francese, Speziale, and VanBomel
which for 1990 totaled 452, 450, and 409, respectively, and for
1991 totaled 574, 425, and 454, respectively. ALJX 61, Appendix
B, Tables V and VI. I have not considered the overtime hours
worked by Driver Santiago because they deviate so markedly from
those worked by the other drivers.
I note that double overtime hours, while apparently
available, were not factored into the back pay equation. As of
[PAGE 3]
his February 13, 1990, discharge, Complainant already had accrued
ten of these hours, and two drivers who were junior to
Complainant accrued significant double overtime during the back
pay period. [2] ALJX 61, Appendix B, Table VII. This omission
offers a further reason to afford Complainant inclusive recovery
of regular wages.
The record evidence fully supports the ALJ's findings
regarding sick pay earnings, and I adopt them. R.D. and O. at 6.
The ALJ then properly offset Complainant's interim earnings,
most of which were derived from seasonal employment. [3] R.D.
and O. at 7. Respondent argues that a further offset is
appropriate. It faults Complainant for quitting his job at
Richard Acerra, Inc., a beverage distributor, in December 1990
and beginning higher paid work with Ameropan, a fuel oil
distributor, all the while knowing it to be a seasonal employer
which likely would, and in fact did, lay him off in the Spring of
1991. Resp. Br. on Relief at 11-17. Respondent also faults
Complainant for purportedly conducting an inadequate job search
following his layoff from Ameropan.
After having reviewed the record, I cannot say that in
choosing jobs Complainant incurred a willful loss of earnings or
that he otherwise failed to mitigate his damages. Respondent
fails to consider that, as a distributor of soft drinks, Richard
Acerra, Inc., also engaged in a seasonal business which was
winding down when Complainant quit in mid-December. This
slowdown was exacerbated by Acerra's loss of a significant
customer, and Complainant then faced an imminent reduction in his
hours of work. Although Complainant knew that layoff from
Ameropan was possible, he also knew that his chances of recall
were good. Indeed, reference to the ALJ's summary, R.D. and O.
at 7, discloses Ameropan to have been one of Complainant's most
consistent employers, providing him with over half of his interim
earnings. I also agree with the ALJ that Complainant conducted
an adequate job search. Complainant's testimony in this regard
is compelling, as is his supporting documentation. Accordingly,
no further offset is warranted.
Finally, I adopt the ALJ's findings on medical expenses
and employee benefits as supported by substantial evidence.
29 C.F.R. § 1978.109(c)(3) (1993). I disagree with the ALJ,
however, on the issue of prejudgment interest. R.D. and O. at 9.
A primary object of the "make whole" relief afforded by remedial
statutes like the STAA is to restore the employee to the monetary
position he would have occupied but for the unlawful
discrimination. Beginning when discharged in February 1990,
Complainant was deprived of the use of wages for which he now
should be compensated by means of an award of interest. In
conformance with past practice, I award prejudgment interest on
[PAGE 4]
the back pay amount to be determined under Section 6621 of the
Internal Revenue Code at the rate used in computing interest
charged on underpayment of Federal taxes. Spinner v. Yellow
Freight System, Inc., and Assistant Secretary of Labor for
Occupational Safety and Health, Case No. 90-STA-17, Sec.
Dec., May 6, 1992, slip op. at 28, aff'd sub nom.Yellow Freight System, Inc. v. Martin, 983 F.2d 1195 (2d
Cir. 1993); Johnson v. Old Dominion Security, Case Nos.
86-CAA-3, et seq., Sec. Dec., May 29, 1991, slip op. at
24, 32; Wells v. Kansas Gas & Electric Co., Case No. 85-
ERA-22, Sec. Dec., Mar. 21, 1990, slip op. at 17 and n.6,
appeal dismissed, No. 91-9526 (10th Cir. Aug. 23, 1991).
2. Attorney fees
In calculating attorney fees under the STAA, 49 U.S.C. app.
§ 2305(c)(2)(B), I generally employ the lodestar method
which requires multiplying the number of hours reasonably
expended in bringing the litigation by a reasonable hourly rate.
Hensley v. Eckerhart, 461 U.S. 424 (1983).
a. Hourly rate
The ALJ has recommended an hourly rate of $175. Substantial
record evidence does not support this recommendation, and I
reject it. I find hourly rates of $275 for Complainant's counsel
Burton Hall and $225 for counsel Wendy Sloan to be more in
keeping with prevailing market rates.
A reasonable attorney's fee is based on rates prevailing in
the community for similar services.
In seeking some basis for a standard, courts
properly have required prevailing attorneys
to justify the reasonableness of the
requested rate or rates. To inform and
assist the court in the exercise of its
discretion, the burden is on the fee
applicant to produce satisfactory evidence --
in addition to the attorney's own affidavits
-- that the requested rates are in line with
those prevailing in the community for similar
services by lawyers of reasonably comparable
skill, experience and reputation. A rate
determined in this way is normally deemed to
be reasonable, and is referred to -- for
convenience -- as the prevailing market rate.
Blum v. Stenson, 465 U.S. 886, 896 n.11 (1984). We are
concerned here with prevailing market rates in the Southern
District of New York. Counsel's Affirmation and Exhibits
establish receipt of hourly fees, most of which were court-
ordered, by the following local attorneys:
[PAGE 5]
Burton Wendy Arthur Daniel Mordecai
Years Hall Sloan Schwartz Clifton Rosenfeld
1984-1985 $185 $145 $145 $145
1985 $170 $170 $170
1986-1987 $225 $190 $190 $190
1987-1988 $245 $210 $300
1989 $250 $210
1991 $250 $250 $375
As mentioned above, Burton Hall and Wendy Sloan were
Complainant's counsel. They received the stated fees for
litigating comparable discrimination claims. [4] Arthur
Schwartz and Daniel Clifton, whose experience and tenure are
similar to Sloan's, also received the stated fees for litigating
comparable claims.
While Mordecai Rosenfeld and Burton Hall were equally
experienced litigators, they practiced in different substantive
areas, which brings into question the comparability of their
expertise, i.e., should civil rights attorneys be
compensated at rates commanded by shareholder derivative
attorneys. But seeBlum v. Stenson, 465 U.S. at
893-895 and n.9 (civil rights attorneys should be paid according
to the same standards that determine compensation for attorneys
of like skill and experience engaging in other forms of equally
complex Federal litigation, including antitrust cases).
Accordingly, while the Rosenfeld affidavit (Exhibit E) may not
offer the same degree of guidance as the Hall, Sloan, Schwartz,
and Clifton rates, it is useful in a "ballpark" sense as
indicative of rates charged locally by small firms engaged in
class action securities, corporate finance, and derivative
litigation. Similarly, the Exhibit D Lawyer's Almanac provides
only a general reference because it does not specify the
practices involved for the "major firms" surveyed. While these
rates may be inflated due to the incorporation of large-firm
overhead, I note that my proposed $275 (Hall) and $225 (Sloan)
rates fall below those of most firms for the comparable attorney
categories. See Exh. D, p. 10 (1991 Lawyers Almanac, New
York City billing rates).
Counsel's Affirmation and Exhibits also establish that, in
1991, Attorney Louis Nikolaides received a fee award of $185/hour
for in-court work and $100/hour for out-of-court work in
comparable discrimination litigation and that, in 1989, Attorney
Joseph Ingarra received an hourly fee award of $150 in similar
litigation. In contrast to the experienced Hall and Sloan,
Nikolaides and Ingarra were extremely inexperienced when they
earned these fees, a consideration militating against the ALJ's
$175/hour recommendation for Hall and Sloan.
In recommending his fee, the ALJ commented that because Hall
[PAGE 6]
and Sloan purportedly lacked "any particular skill related to the
issues presented in this case or in the area of administrative
law in general . . . no departure from a general prevailing rate
is necessary." R.D. and O. at 10. He also offered, without
elucidation, the following comment: "Mr. Hall and Ms. Sloan's
actions complicated matters beyond reasonable bounds and cannot
now claim [sic] that this is a 'complex' litigation requiring a
higher fee." [5] Id. Nowhere, however, did the ALJ
engage in any meaningful discussion of rates prevailing in the
community for similar services, which should have been a primary
consideration in recommending a rate.
I also note that in deciding on the $175 figure, the ALJ
cited Cruz v. Local 3, International Brotherhood of Electrical
Workers, No. CV 89-4240 (ADS), 1993 U.S. Dist. LEXIS 9570,
at *10-*20 (E.D.N.Y. July 12, 1993), where the court ordered an
hourly rate of $200 for Hall and $175 for Sloan in remuneration
for their limited, initial participation in a case tried by other
attorneys. The pattern of rates established in counsel's
Affirmation and Exhibits suggests, however, that Cruz may
be an anomaly. Stressing that "[t]he amount of a [fee] award . .
. must ultimately be determined on the facts of each case," the
judge in Cruz based his determination on the experience of
the attorneys and the type of work performed, which in the
case of Hall and Sloan was preliminary, out-of-court work.
Id. at *10, *16. According to the judge, "[t]he crucial
work was done at trial." Id. at *20. In addition, the
firm of Hall & Sloan already had received compensation designated
attorney fees as the result of a settlement reached with one of
the defendants. Because of these singular circumstances, I
decline to accord Cruz decisive weight in determining a
reasonable rate in the instant case.
b. Hours expended
Complainant's counsel request reimbursement for a total of
269.33 hours spent litigating this case. Counsels' participation
before the Department dated from February 1991 until April 1994,
a period exceeding three years duration. Two two-day hearings
and two separate instances of briefing before the ALJ and the
Secretary were required. The following particular hours are
billed:
HoursActivity Counsel
94.0 liability hearing Hall
1.0 liability hearing Sloan
93.0 damages hearing Sloan
10.5 affirmation, fee application Sloan
14.0 reply affirmation, fee
application Sloan
21.83 ALJ reply brief Sloan
35.0 Secretary damages and fee
application brief Sloan
On its face, this amount of time expended on a case of this sort
does not appear excessive. A comparable discrimination case,
Danna v. New York Telephone Co., No. 87 CIV 7250 (CBM),
slip op. at 7-8 (S.D.N.Y. May 2, 1991), appears at Exhibit F of
counsel's 9/28/92 Affirmation. In a single-plaintiff Title VII
sex discrimination case litigated over a three-year period, the
court found excessive the 562 hours billed, reducing the figure
by one third -- to 375 hours, an amount somewhat exceeding that
billed here. I also note that in cases cited in the Danna
decision courts found reasonable 500 hours for litigating a
discrimination case spanning a six-year period and 200 hours for
litigating discrimination cases spanning four-year periods.
Id. The Danna court stated that its fee
reduction placed the resulting award in line with these "similar
discrimination cases." Id. at 8.
The ALJ has recommended that 4.75 hours billed by Sloan for
travel time should be reduced by 50 percent. I cannot say that
this disposition is unreasonable. SeeIn re Agent
Orange Products Liability Litigation, 611 F. Supp. 1296,
1320, 1349 (E.D.N.Y. 1985). Accordingly, Sloan's 93.0 hours
billed for the damages hearing is reduced to 90.625 hours.
In order to substantiate fee billings, a counsel's
contemporaneous records must "specify, for each attorney, the
date, the hours expended, and the nature of the work done."
New York State Ass'n for Retarded Children, Inc. v. Carey,
711 F.2d 1136, 1148 (2d Cir. 1983). SeeLewis v.
Coughlin, 801 F.2d 570, 577 (2d Cir. 1986) (records must be
made contemporaneously with associated work). Here, counsel
primarily submit copies of dated calendar entries documenting the
number of hours worked on each date and detailing the type of
work performed. In her 4/21/94 Supplemental Affirmation as to
Fees, counsel Sloan additionally provides a typed summary as to
those 35 hours. Supp. Affirm.
at 2. A typed account of the remaining hours appears in
Complainant's 4/12/94 Brief to the Secretary at 77-80 n.15.
The original records -- the dated calendar entries -- were
recorded contemporaneously with the work being done. 9/28/92
Affirmation at 21, pars. 40-42; 4/21/94 Supplemental Affirmation
as to Fees at 1, par. 2. The handwritten entries are difficult,
but not impossible, to read. That the notations relate to the
Clay case is apparent. The numbers of hours expended and
time notations uniformly are legible. The descriptions of work
done are less so, often because they contain abbreviations.
Comparison of the calendar entries to their typed transcriptions,
however, facilitates identification. Having studied the calendar
entries closely, I am satisfied that they represent time
reasonably expended in bringing the instant litigation. I am
[PAGE 8]
concerned only with imprecision in recording amounts of time
expended. In some instances, large blocks of time are attributed
to activities, particularly to briefing, which may have resulted
in overstatement. Accordingly, I find it appropriate to reduce
the number of hours billed by ten percent. I reject the ALJ's
recommended reduction of 30 percent as excessive and his further
reduction, for punitive purposes, of an additional ten percent as
unwarranted.
I have considered the ALJ's remaining reductions, R.D. and
O. at 11 (second and third full pars.), and I am not persuaded
that they are appropriate especially since I already have reduced
the billed hours comprehensively. The sur-reply letter, in
particular, appears legitimately to have required counsels'
attention. Complainant's counsel questioned the veracity of
certain witnesses and the propriety of actions by Respondent's
counsel who, in turn, suggested that Complainant's counsel may
seriously have tainted the proceedings. The ALJ then ordered
Complainant's counsel to respond, which resulted in his filing
the five page single-spaced sur-reply letter. Certainly the
sensitive circumstances and reasonably perceived necessity for
explanation warranted expending more than the single hour
"contemplated" by the ALJ. R.D. and O. at 11.
Finally, prevailing parties routinely are awarded fees for
attorney time spent in preparation of the fee application itself,
and I include counsel's 24.5 hours billed to that end.
See B. Schlei & P. Grossman, Employment Discrimination Law
(2d ed. 1983) at 1485 and n.48.
The following attorney fees are awarded:
Hall 84.60 hours x $275/hour = $23,265
Sloan 155.66 hours x $225/hour = $35,023.50
In addition, costs and expenses of ,093 are awarded as
recommended by the ALJ. R.D. and O. at 9-10.
ORDER
Respondent Castle Coal and Oil Company, Inc., is ordered to
compensate Complainant Ralph B. Clay as follows:
1. Lost earnings and sick pay are awarded in the amount
of $46,260.58;
2. Medical expenses are awarded in the amount of
$2,612.50;
3. Prejudgment interest is awarded on the back pay
award to be determined as specified herein;
4. Attorney fees, costs and expenses are awarded in the
total amount of $59,381.50.
[PAGE 9]
5. Respondent is ordered to pay $7,674.40 to the
Local 553 deferred compensation fund as well as any
other sums required under the schedule specified by the
ALJ. R.D. and O. at 8-9.
SO ORDERED.
ROBERT B. REICH
Secretary of Labor
Washington, D.C.
[ENDNOTES]
[1] Apparently, depending on consumer demand, some of
Respondent's employees may work only four days during any five
consecutive weekdays. These employees, however, are entitled to
be the first drivers out on the weekend. Weekday wages are paid
at regular straight-time rates with overtime available on
extended shifts. Overtime rates also are paid on weekends.
[2] The double overtime worked by these employees would be
relevant to Complainant's estimated hours in light of
Respondent's agreement to increase Complainant's overtime
opportunities.
[3] I decline to deduct unemployment compensation benefits from
the back pay award. I view recoupment of these benefits by the
State of New York according to whatever formula it prescribes to
be a preferable method for settling this obligation, which, after
all, exists between Complainant and the State. SeeWilliams v. TIW Fabrication & Machining, Inc., Case No.
88-SWD-3, Sec. Dec., June 24, 1992, slip op. at 12-13 and n.6.
[4] Hall & Sloan is a small New York City firm which engages in
labor law litigation concerning the rights of employees and Union
members under such Federal statutes as the Labor-Management
Reporting and Disclosure Act, the Labor-Management Relations Act,
the Employee Retirement Income Security Act, and the Civil Rights
Acts of 1870 and 1964. In addition to maintaining a Federal
court practice, the firm appears before administrative agencies
such as the National Labor Relations Board, the Equal Employment
Opportunity Commission, the Merit Systems Protection Board, the
New York State Division on Human Rights, and the New York City
Commission for Human Rights.
[5] I have reviewed the case record in its entirety. The
complicating actions to which the ALJ refers are not immediately
apparent.
