                                                                                                                           Opinions of the United
1997 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


2-26-1997

Smith v. Phila Housing Auth
Precedential or Non-Precedential:

Docket 96-1370,96-1379




Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_1997

Recommended Citation
"Smith v. Phila Housing Auth" (1997). 1997 Decisions. Paper 47.
http://digitalcommons.law.villanova.edu/thirdcircuit_1997/47


This decision is brought to you for free and open access by the Opinions of the United States Court of Appeals for the Third Circuit at Villanova
University School of Law Digital Repository. It has been accepted for inclusion in 1997 Decisions by an authorized administrator of Villanova
University School of Law Digital Repository. For more information, please contact Benjamin.Carlson@law.villanova.edu.
                   UNITED STATES COURT OF APPEALS
                       FOR THE THIRD CIRCUIT



                      Nos. 96-1370 and 96-1379


                           VERNITA SMITH,
                                    Appellant No. 96-1370
                                 v.

           PHILADELPHIA HOUSING AUTHORITY; LARGHNE LAHM;
                     JOHN VARALLO; CLAUDE ROSS




                           CARMEN RIVERA,
                                    Appellant No. 96-1379
                                 v.

                  PHILADELPHIA HOUSING AUTHORITY;
             ANTHONY HOLLAND; JOHN VARALLO; CLAUDE ROSS



           On Appeal From the United States District Court
              for the Eastern District of Pennsylvania
               (D.C. Nos. 94-cv-07284 and 95-cv-07658)


                      Argued January 10, 1997

                  BEFORE: COWEN, ALITO and ROSENN
                           Circuit Judges

                                                )   (Filed February
26, 1997

Michael Donahue, Esq.
Harold I. Goodman, Esq. (argued)
Community Legal Services
1424 Chestnut Street
Philadelphia, PA 19102

           COUNSEL FOR APPELLANTS


M. Kevin Hubbard, Esq. (argued)
Philadelphia Housing Authority
2012 Chestnut Street
Philadelphia, PA 19103



                                  1
            COUNSEL FOR APPELLEES



                                OPINION


COWEN, Circuit Judge.


       Plaintiffs in this consolidated appeal contest the amount of

attorney’s fees awarded by the district court pursuant to 42

U.S.C. § 1988.     Specifically, they contend that the district

court erred in finding $150 to be the reasonable hourly rate for

the services provided by their attorney, rather than the $210 per

hour rate they requested.     For the reasons that follow, we will

vacate the judgments of the district court and remand for further

proceedings.
                                    I.

       Plaintiffs Vernita Smith and Carmen Rivera are indigent

tenants of defendant Philadelphia Housing Authority (“PHA”).

Each commenced an action in the district court pursuant to 42

U.S.C. § 1983 and the United States Housing Act, 42 U.S.C. § 1437

et seq., in order to enforce administrative grievance awards

previously issued in their favor pursuant to 24 C.F.R. §§ 966.50-

.57.   Smith’s award required the PHA to make certain repairs to

her rental unit.    Rivera’s award provided for a rent abatement

and a rollback of a rent increase imposed by the PHA.    Both Smith

and Rivera were represented by Michael Donahue, Esq., of

Community Legal Services (“CLS”) of Philadelphia.    It is not

disputed that Smith and Rivera were each a “prevailing party” in

their respective lawsuits, within the meaning of § 1988.



                                    2
     Plaintiffs petitioned the court for attorney’s fees pursuant

to § 1988, requesting an hourly rate of $210.         In support of

their petitions, plaintiffs each submitted two affidavits, one

from Donahue and one from Lorrie McKinley.          McKinley is Project

Head of the Employment Law Project at CLS and Chair of the CLS

Attorneys Fees Committee, which establishes the usual billing

rates for CLS counsel.   Donahue’s affidavit noted that he has

been a member of the federal bar since 1978, and has litigated

over 200 cases involving the federal housing regulations,

including ten class actions and four successful appeals in this

Court.1   Donahue averred that $210 per hour is a reasonable

market rate for the services he rendered.

     McKinley’s affidavit stated that she has been practicing law

since 1984 and is familiar with the market rates for civil rights

attorneys in the Philadelphia area.       It stated that Donahue’s

usual hourly rate is $210, and that this rate is consistent with

the rates for attorneys of similar experience and skill in civil

rights matters in Philadelphia.       The latter statement is based on

the CLS schedule of rates, which in turn is “based upon a survey

of hourly rates charged by private law firms and individual

practitioners in Philadelphia.”       App. at 38.

     In both cases, the PHA objected to the proposed hourly rate

because it was higher than the rate awarded Donahue in similar

prior cases, but it offered no affidavits to support its

position.   The PHA did not object to the McKinley affidavit, but
     1
      That number has since grown to five.         See Farley             v.
Philadelphia Housing Auth., 102 F.3d 697 (3d Cir. 1996).




                                  3
it contested the propriety and reliability of the underlying fee

schedule and survey.    Without holding evidentiary hearings, the

district court set the hourly rate at $150 in both cases.       The

court cited opinions in prior cases in which Donahue had

represented plaintiffs in actions brought pursuant to the Housing

Act, and in which the court had set Donahue’s rate at $150 per

hour.    This consolidated appeal followed.
                                 II.

     The reasonableness of an award of attorney’s fees is

reviewed pursuant to an “abuse of discretion” standard.       See

Washington v. Philadelphia County Court of Common Pleas, 89 F.3d

1031, 1034 (3d Cir. 1996); Coleman v. Kaye, 87 F.3d 1491, 1509

(3d Cir. 1996), cert. denied, ___ U.S. ___, 117 S.Ct. 754 (1997);

Rode v. Dellarciprete, 892 F.2d 1177, 1182 (3d Cir. 1990).          “[A]n

attorney’s marketplace billing rate is a factual question which

is subject to a clearly erroneous standard of review.”

Washington, 89 F.3d at 1035; see Student Pub. Interest Research

Group v. AT & T Bell Labs., 842 F.2d 1436, 1442 (3d Cir. 1988).

The question of whether the district court applied the

appropriate standards and procedures in determining attorney’s

fees is a legal question subject to plenary review.     See
Washington, 89 F.3d at 1034-35; Keenan v. City of Philadelphia,

983 F.2d 459, 472 (3d Cir. 1992).

        Generally, “a reasonable hourly rate is calculated according

to the prevailing market rates in the community.”    Washington, 89

F.3d at 1035; see Blum v. Stenson, 465 U.S. 886, 895-96 n.11, 104
S.Ct. 1541, 1547 n.11 (1984).    “[A] district court may not set



                                  4
attorneys’ fees based upon a generalized sense of what is

customary or proper, but rather must rely upon the record.”

Coleman, 87 F.3d at 1510 (emphasis added); see Cunningham v. City

of McKeesport, 807 F.2d 49, 52-53 (3d Cir. 1986).    The plaintiff

bears the burden of producing sufficient evidence of what

constitutes a reasonable market rate for the essential character

and complexity of the legal services rendered in order to make

out a prima facie case.   See Washington, 89 F.3d at 1035.    Once

the plaintiff has carried this burden, defendant may contest that

prima facie case only with appropriate record evidence.    See id.

at 1036; Cunningham, 807 F.2d at 52-53.     In the absence of such

evidence, the plaintiff must be awarded attorney’s fees at her

requested rate.   See Washington, 89 F.3d at 1036; Cunningham, 807

F.2d at 52-53; Bell v. United Princeton Properties, Inc., 884

F.2d 713, 720 (3d Cir. 1989).     If hourly rates are disputed, the

district court must conduct a hearing to determine the reasonable

market rates.   See Coleman, 87 F.3d at 1510; Rode, 892 F.2d at

1183.

     The PHA urges that the McKinley affidavit fails to establish

$210 as a reasonable hourly rate because the survey upon which it

is ultimately based is flawed.2    The McKinley affidavit is based
    2
      The PHA now contests the validity of the McKinley affidavit
on the additional ground that, while McKinley was never retained
by plaintiffs, she and Donahue worked for the same organization.
The Supreme Court has stated that “the fee applicant [must]
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.” Blum v.
Stenson, 465 U.S. 886, 895 n.11, 104 S.Ct. 1541, 1547 n.11
(1984)(emphasis added); see also In re Olson, 884 F.2d 1415, 1423-
24 n.14 (D.C. Cir. 1989).     Because the PHA did not raise this



                                  5
in part on CLS’s hourly fee schedule, which in turn is based on a

survey of private firms in Philadelphia.    The PHA argues that

this underlying survey is insufficient to establish $210 per hour

as a reasonable market rate for a Housing Act case insofar as the

survey fails to differentiate among different types of

litigation.    Rather, the survey apparently establishes a single

schedule of rates for litigation involving such diverse matters

as employment discrimination, landlord-tenant law, criminal law,

corporate law, divorce law, and labor law.    See Evans v.

Philadelphia Housing Auth., Civ. A. No. 93-5547, 1995 WL 154872,

at *3 (E.D. Pa. Mar. 31, 1995) (discussing same survey), aff’d

sub nom Smith v. Philadelphia Housing Auth., 79 F.3d 1139 (3d

Cir. 1996).    Therefore, the PHA contends, the survey is

unreliable and cannot form the basis for the plaintiffs’ prima

facie case.

     Our review is hampered both by the fact that the parties

have not included the survey as part of the record on appeal and

by the district court’s failure to address directly the survey

evidence.    Rather, in Smith, the court simply stated:
            This Court determines . . . that $150.00 per
            hour, not $210.00 per hour, is a reasonable
            rate. In reaching this conclusion, this
            Court adopts the reasoning of four District
            Court Judges in the Eastern District of
            Pennsylvania, all of whom recently found
            $150.00 per hour to be a reasonable rate for
            Mr. Donahue’s services in representing
            tenants in actions against the Philadelphia
            Housing Authority and all of whom were
            affirmed on appeal . . . .

issue
below, we decline to address it here.



                                 6
Smith v. Philadelphia Housing Auth., No. 94-7284, slip op. at 5

(E.D. Pa. Feb. 15, 1996) (citing, inter alia, Evans, 1995 WL

154872; Clark v. Philadelphia Housing Auth., No. 93-4890, 1995 WL

129208 (E.D. Pa. Mar. 24, 1995), aff’d sub nom Smith v.

Philadelphia Housing Auth., 79 F.3d 1139 (3d Cir. 1996); Jenkins

v. Philadelphia Housing Auth., No. 94-5475, 1995 WL 105479 (E.D.

Pa. Mar. 10, 1995), aff’d sub nom Smith v. Philadelphia Housing

Auth., 79 F.3d 1139 (3d Cir. 1996); Smith v. Philadelphia Housing

Auth., No. 94-0147, 1994 WL 376874 (E.D. Pa. July 14, 1994)).

The Rivera court’s analysis was even more cursory, stating only

that Donahue’s “rate of $210 per hour for the type of services

rendered is excessive,” Rivera v. Philadelphia Housing Auth., No.

95-7658, slip op. at 1 (E.D. Pa. Apr. 19, 1996), and that “[t]he

court finds [$150 per hour to be] reasonable and consistent with

recent decisions by th[e] court which have rejected Mr. Donahue’s

requested rate.”   Id. slip op. at 2 (citing Clark, 1995 WL

129208).

     By contrast to the cases cited by the district court, the

plaintiffs cite a number of district court cases that have

accepted the CLS schedule.   See, e.g., Rainey v. Philadelphia
Housing Auth., 832 F. Supp. 127, 129 (E.D. Pa. 1993); Swaayze v.

Philadelphia Housing Auth., Civ. A. No. 91-2982, 1992 WL 81598,

at *2 (E.D. Pa. Apr. 16, 1992); Higgins v. Philadelphia Gas

Works, 54 B.R. 928, 938 (E.D. Pa. 1985).

     We decline to address whether the CLS schedule and the

survey that undergirds it are sufficiently reliable and adequate

given that this issue was not addressed by the district court in


                                7
the first instance.    As this Court recently reaffirmed, “[t]he

matter of an attorney’s marketplace billing rate is a factual

question.”   Washington, 89 F.3d at 1035.   The district court may

not dispose of such a factual question “based upon a generalized

sense of what is customary or proper, but rather must rely upon

the record.”   Coleman, 87 F.3d at 1510.    By simply relying on the

hourly rate set by the court for Mr. Donahue in previous cases in

which he has appeared, the district court failed to exercise its

responsibility, as set forth by us most recently in Washington

and Coleman, to settle upon a reasonable hourly rate based solely

upon a factual record.   We therefore will remand these matters so

that the district court in each case may construct an adequate

record to justify an award of attorney’s fees at a particular

rate.

     On remand, the district court should determine whether the

plaintiffs have submitted sufficient evidence to establish a

prima facie case.   The answer to this question will in large part

hinge on whether the CLS fee schedule, and the underlying survey,

are sufficiently reliable to form the basis of McKinley’s

affidavit testimony.   See FED. R. EVID. 703; In re Paoli R.R. Yard
PCB Litig., 35 F.3d 717, 747-49 (3d Cir. 1994), cert. denied, ___

U.S. ___, 115 S.Ct. 1253 (1995).     Plaintiffs will have the

opportunity to submit any additional evidence they believe to be

appropriate.   The PHA may continue to rely simply on its

contention that the plaintiff’s evidence is insufficient to

establish a prima facie case that $210 is a reasonable hourly

fee, and rest solely on “answers or briefs”.     Bell, 884 F.2d at


                                 8
720.       Alternatively, it may choose to supplement this legal

argument by adducing evidence to dispute the affidavit testimony

submitted by the plaintiffs.       If the PHA raises a factual issue

as to the reasonableness of Donahue’s requested rate, it “must

introduce [evidence] upon which the challenge is based.”       Id.

(emphasis added).3
                                   III.

       For the foregoing reasons, the judgments of the district

court will be vacated and these matters remanded for further

proceedings consistent with this opinion.

       Costs taxed against appellees.




       3
      We express no opinion as to whether $150 or $210, or some
other figure, represents a reasonable hourly billing rate for Mr.
Donahue’s services in this matter.



                                    9
