Articles Posted in Attorney fees and costs

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Earlier this week, the First Circuit Court of Appeals affirmed a trial court’s decision to award the plaintiff’s attorney in Diaz v. Jiten Hotel Management, Inc. over $100,000 in fees and costs after she won a jury verdict of only $7,650 for her client in an age discrimination case. The plaintiff’s attorney incurred this relatively high amount of fees and costs, in part, because the case was appealed to the First Circuit three times.

Jiten Hotel Management’s attorneys argued that the First Circuit should reduce the amount of fees and costs that the trial court awarded to the plaintiff’s attorney because they were so much higher than the jury verdict she obtained for her client. The First Circuit rejected Jiten Hotel Management’s argument because the statute that entitles prevailing plaintiffs’ attorneys to compensation for their fees and costs was designed to encourage attorneys to pursue civil rights cases even if the plaintiff suffered relatively little harm. These “fee shifting” statutes ensure that civil rights laws are enforced. If defendants who violated civil rights laws did not have to pay the fees and costs that plaintiffs’ attorneys incurred, many plaintiffs’ attorneys could not afford to pursue civil rights cases and the civil rights laws would not be enforced. Thus, it makes sense for the court to award Diaz’s attorney with such a large award of fees and costs because if it didn’t, she may have never taken Diaz’s case and Jiten Hotel Management could have gotten away with discriminating against Diaz because of her age.

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Today, the U.S. First Circuit Court of Appeals, which has jurisdiction over Maine and other New England states, affirmed a Massachusetts trial court’s decision to hold HEI Hospitality liable for unlawfully retaliating against its former senior vice-president. HEI fired the former senior vice-president, Lawrence Trainor, a few hours after he complained that it was discriminating against him because of his age (he was in his 60’s at the time). Under federal and Massachusetts law, it is not only illegal for an employer to discriminate against an employee because of his age; it is also illegal to retaliate against an employee who complains of age discrimination–even if no age discrimination occurred. That is exactly what the jury found in this case. It found that HEI did not discriminate against Trainor because of his age but that it did retaliate against him for opposing what he thought constituted age discrimination.

The First Circuit’s opinion also contains important holdings on the issues of front pay, attorney fees, and damages for emotional distress. With respect to front pay, the First Circuit held that an award of liquidated damages, designed to punish an employer for its unlawful retaliation, does not foreclose an award of front pay. This is because front pay is designed to compensate the victim of retaliation for wages that he would have earned in the future had the employer not violated his rights–not to punish the employer.

With respect to attorney fees, when a plaintiff in an employment discrimination case prevails at trial, the employer is typically required to pay the plaintiff’s reasonable attorney fees. HEI argued that the fees in this case should be reduced because Trainor only prevailed on his retaliation claim, not his age discrimination claim. The trial court and the First Circuit disagreed with HEI because the age discrimination and retaliation claims were so intertwined that all of the work that Trainor’s attorney performed on the case was necessary for both claims.

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On September 18, 2012, the U.S. First Circuit Court of Appeals held that a federal judge in Massachusetts erred in his decision about how much to award in attorney fees and legal expenses to a plaintiff, Carmen Llerena Diaz, who prevailed in an age discrimination case against her former employer. Most employment discrimination laws require employers to reimburse plaintiffs for reasonable attorney fees and legal expenses if they prevail at trial. After the jury found in Ms. Diaz’s favor, her attorney requested that the trial judge require the defendant, Jiten Hotel Management, to reimburse her for legal expenses and attorney fees. The trial judge refused to require Jiten to pay all of the legal expenses and attorney fees that Ms. Diaz’s attorney requested, in part, because prior to trial Ms. Diaz decided not to settle her case and, instead, decided that she wanted to bring her case before a jury.

The First Circuit held that the trial judge could not reduce Ms. Diaz’s attorney fee award merely because she refused to settle her case prior to trial. This is an important decision because without fair awards of attorney fees and legal expenses, many people with meritorious civil rights claims would not be able to get a lawyer to represent them unless they could pay thousands of dollars of their own money. In many cases, when an employer discriminates against an employee, the employee does not have thousands of dollars to pay for an attorney. For instance, if an employer unlawfully fires an employee, that employee usually no longer has any money that he can use to pay for an attorney. So, these employees have to find an attorney who will represent them on a contingent fee basis, meaning that the attorney gets a percentage of what the employee recovers in order to pay for the time she put into the case. In relatively small cases, like Ms. Diaz’s case in which the jury awarded her only $7,650, an attorney would be unwilling to take the case unless she knew that the employer would have to pay an additional amount in attorney fees if she won.