No. CV 04-2572-PHX-NVW.
April 28, 2006
Plaintiff Christian Legal Society Chapter at Arizona State University College of Law's Motion for Attorneys' Fees and Costs (doc. # 123) will be granted in part and denied in part.
I. Nature of the Action and Summary
The Christian Legal Society Chapter at Arizona State University College of Law ("CLS") brought this action for declaratory and injunctive relief against Arizona State University officials ("the University"), alleging interference with its right under the Federal Constitution to exclude students from its membership and leadership positions "based upon their shared religious beliefs and/or viewpoint regarding homosexual conduct." (Compl. at 17 at ¶ 1.) After eleven months of litigation, the parties reached a settlement. The University agreed that registered student organizations may exclude members for lack of shared religious belief, but only insofar as the exclusion does not violate the University's other nondiscrimination policies, including sexual orientation nondiscrimination. CLS may exclude persons who engage in or approve of sexual conduct, whether heterosexual or homosexual, outside traditional marriage. CLS now moves for attorneys' fees pursuant to 42 U.S.C. § 1988.
The positions taken by both parties evolved over the course of litigation. CLS brought this action asserting a right to exclude homosexuals specifically but later shifted to a more general claim of right to exclude persons engaging in extramarital sexual conduct, a position to which the University took no exception. For its part, the University adopted a more stringent position with regard to religiously exclusive student organizations in defending this litigation than the University had ever historically enforced. (doc. # 96 at 6:3-25.) Although religious student groups had never been stopped from defining membership and officership based on shared religious beliefs, in this litigation the University took a general position that religious student groups could not exclude persons of different religious beliefs. By the end of the litigation, however, the University acquiesced on the point. Religious student groups may now exclude members of different religious beliefs so long as the discrimination is not also based on a prohibited characteristic. Despite these significant shifts in both parties' positions, and perhaps naturally on an attorneys' fees motion, both CLS and the University argue that their own position remained unchanged and the settlement was reached because the other party accepted defeat. In reality both parties accepted some defeat.
This action was brought to establish a principle of law and was expressly framed as such. When CLS filed this action, the University had not denied CLS registration as a student organization and CLS had not applied for it. Rather, CLS attempted to craft exactly the legal question it wished to litigate by writing a letter to the University stating what the University's policies meant, proclaiming them unlawful, and demanding an exemption from them. Though the University withdrew the objectionable language from the application form, CLS filed this action, asserting that the Student Code of Conduct also required CLS to accept homosexuals. CLS staked out this contention in its Complaint, which asserted that the University's nondiscrimination policy infringed CLS's religion-based constitutional right to exclude homosexuals. Faced with this Bob-Jones-like claim to government accommodation of focused discrimination against homosexuals, the University resisted.
The court recognizes the conduct-status distinction explicitly stated in the Complaint. While the Complaint maintained CLS's right to exclude persons "engag[ing] in homosexual conduct or adher[ing] to the viewpoint that homosexual conduct is not sinful," it disavowed any intent to exclude persons based on their sexual orientation independent of their conduct or viewpoint. (Compl. ¶ 3.8.) For the sake of economy of expression, the court will refer to CLS's original avowed category of discrimination as homosexual discrimination while keeping in mind CLS's own intention not to exclude persons for mere status without conduct or opinion. Without diminishing the sincerity or the importance to CLS of its distinction, the distinction does not remove CLS's exclusionary policy as alleged in its Complaint from the fair meaning of discrimination based on sexual orientation. The University may reasonably interpret its policy as protecting persons "engaging in homosexual conduct" as well as celibate homosexuals.
See Bob Jones Univ. v. United States, 461 U.S. 574, 602-04 (1983) (rejecting private university's argument that its religious interest in racial discrimination required governmental accommodation of that discrimination).
Because this declaratory judgment litigation was not grounded in actual harm inflicted by the University but in CLS's refusal to apply for recognition on the specific claim of principle it articulated, CLS's articulation, alleged in its Complaint, takes on critical importance for finding who prevailed and how successful they were. The bare fact that CLS had recognition in the end and not in the beginning does not answer either question. Though CLS would so cast it now, this litigation was never about University recognition directly. It was about the reason CLS would not apply for recognition, and now it is about whether CLS vindicated or yielded that reason when it did apply in the end.
II. Facts and Procedural History
A. Christian Legal Society's History at ASU and Statement of Faith
For at least fourteen years CLS operated as a student organization at the University and registered intermittently with the University. (doc. # 142 Ex. 5.) When it registered, CLS also submitted a Student Organization Registration Form by which it warranted the following:
Membership privileges (including all rights to vote and hold office) will be extended to any qualified individual without regard to race, color, religion, national origin, citizenship, sex, sexual orientation, age, disability, or veteran status.
( E.g., id. at Ex. 5 at 00077, 00079, 00080, 00082.) Filling out these renewal forms entitled CLS to the benefits of University registration such as free photocopies, posters, sound equipment rentals, lockers, and a mailbox. (Compl. ¶ 3.15.)
CLS's standard of common interest and membership is the Statement of Faith adopted by CLS's national organization. The Statement of Faith reads:
Trusting in Jesus Christ as my Savior, I believe in:
• One God, eternally existent in three persons, Father, Son and Holy Spirit.
• God the Father Almighty, Maker of heaven and earth.
• The Deity of our Lord, Jesus Christ, God's only Son conceived of the Holy Spirit, born of the virgin Mary; His vicarious death for our sins through which we receive eternal life; His bodily resurrection and personal return.
• The presence and power of the Holy Spirit in the work of regeneration.
• The Bible as the inspired Word of God.
( Id. at ¶ 3.7.)
B. Commencement of Litigation
In the Fall of 2004, some CLS members became concerned that the non-discrimination policy might require CLS to accept members who did not share their faith, though neither CLS nor any of the University's more than forty other religiously-based registered student organizations had ever had such an incident. In addition, some students had learned of litigations brought by other Christian Legal Society chapters against other universities challenging sexual orientation non-discrimination policies similar to the University's. CLS's membership voted to authorize litigation against the University's non-discrimination policy.
By letter of September 29, 2004, CLS requested through its counsel an exemption from the University's nondiscrimination policy. The letter to the University stated:
[CLS] requires its members and officers to sign and endeavor to live by the national Christian Legal Society's Statement of Faith.
CLS interprets its Statement of Faith to require that officers and members adhere to orthodox Christian beliefs, including the Bible's prohibition of sexual conduct between persons of the same sex. A person who engages in homosexual conduct or adheres to the viewpoint that homosexual conduct is not sinful would not be permitted to serve as a [CLS] officer or member.
(doc. # 142 Ex. 11 at 2.) Asserting that the University's "policy prohibits student organizations from selecting members and officers on the basis of religion and sexual orientation," CLS counsel's letter requested "an exemption from the religion and sexual orientation portions of the University Nondiscrimination Policy." ( Id.)
In response on October 15, 2004, the University removed from its registration packet the non-discrimination language to which CLS objected and advised CLS that it must file an application for registration like all other student groups. (Compl. Ex. F; id. at Ex. H.) The amended registration packet retained the requirement that student organization sponsors certify that their group was in compliance with the Student Code of Conduct. ( Id. at Ex. F; compare id. at Ex. E.) The Student Code of Conduct prohibits "[e]ngaging in discriminatory activities, whether unlawful or whether prohibited by university policy, on the basis of age, ethnicity, gender, disability, color, national origin, race, religion, sexual orientation, or veteran status." (doc. # 96 at 3:8-11 (emphasis added).) The Student Code of Conduct has no independent content; it merely references discrimination that is "unlawful" or "prohibited by university policy."
Rather than submitting an application on the new form or inquiring further, CLS brought this action on November 17, 2004, seeking recognition without certifying compliance with the non-discrimination term of the Student Code of Conduct. CLS alleged (1) that its officers and members were required to adhere to the Bible's prohibition against sexual conduct between persons of the same sex and (2) that a person engaging in homosexual conduct or believing homosexual conduct is not a sin would not be permitted to serve as an officer or member. (Compl. ¶ 3.8.) The Complaint sought declaratory and injunctive protection of CLS's and its members' right to "select members, leaders, and officers based upon their shared religious beliefs and/or viewpoint regarding homosexual conduct." ( Id. at 17 at ¶ 1.)
C. Ambiguity and Resolution of the Religious Discrimination Challenge
The Complaint, like the September 29, 2004 letter, posed religious freedom as the basis for a right to exclude homosexuals specifically. However, the Complaint did not clearly pose a more general challenge to forced acceptance of students of other faiths in faith-defined groups. Nor did it allege a factual basis and case or controversy for such a challenge unless it is entailed in CLS's specific claim of religious right to target homosexuals for exclusion.
When CLS filed its complaint, the University had no published written statement of policy concerning religious non-discrimination in organization membership. The University's previous statements of policy had no history of enforcement one way or the other. Those former statements were written at the highest level of generality and could be absolute or, in context, could be taken as implicitly allowing organizing by religious beliefs. Prohibition of religious discrimination might speak only to exclusion that is irrelevant to the organizing common interest. Where the common interest is religion and religions are mutually exclusive, the measures of inclusion and exclusion are reciprocal and benign. Exclusion from such an organization for most students would carry no stigma because non-adherence to the shared religion carries none.
Thus, the University could have intended any prohibition of religious discrimination in membership as permitting religion-exclusive registered student organizations in general, but not to circumvent other nondiscrimination policies; or it could have intended not to recognize any religion-exclusive organization at all. Apparently the issue never came up and the University never thought about it before this litigation. In resisting CLS's claim of religious right to target homosexuals for exclusion, however, the University took the position that religious belief may not be used either as an exclusive criterion of common interest or as a specific criterion of exclusion.
For example, on April 21, 2005, five months into this litigation, the University again amended its registration forms to restore the previously deleted language requiring sponsors to certify that "[m]embership and all privileges . . . [are] extended to all students without regard to . . . creed, . . . religion [or] sexual orientation." (doc. # 96 at 5:23-6:2.) While the restoration of this language alone did not resolve its ambiguity, in interrogatory responses the University later explained that CLS's articulated policies would violate both the "religious" and "sexual orientation" prongs of the University's nondiscrimination policy. (doc. # 143 Ex. 1 at 6:4-7:8.) The University noted specifically that "excluding university students from membership and leadership because of those students' religion would constitute discriminatory activities." ( Id. at Ex. 1 at 7:6-7:8.) Even earlier in the University's motion to dismiss, it implied a general objection to exclusion for lack of shared religious beliefs, providing as an example of problematic conduct that CLS would bar from membership persons of different faiths. (doc. # 26 at 4 n. 2 (arguing that CLS "would bar from membership persons belonging to the Church of Jesus Christ of the Latter-Day Saints"); see also id. at 5:5-8.) Finally, in a public statement the University's Deputy General Counsel explained, "Initially I think people thought this lawsuit was about sexual orientation, but it is really as much about religious discrimination." (doc. # 143 Ex. 9 at Ex. A at 3.)
Although the University now contends that it had no desire to litigate over whether religious groups could exclude for lack of shared religious beliefs generally, the University did litigate it.
D. The Challenge to Case or Controversy and CLS's Revised Position on Sexual Orientation Discrimination
At the April 15, 2005 oral argument on the motion to dismiss the Establishment Clause claim, the court ordered CLS to show cause why the Complaint should not be dismissed for lack of a case or controversy. (doc. # 63.) The University was eager to defend and litigate its policy against targeted exclusion of homosexuals from registered student organizations, but the premise of the lawsuit may have been nothing more than lawyers' letters disagreeing on legal points.
In response, CLS filed an application for registration with the University, attaching a letter dated May 6, 2005, stating CLS's qualifications to the required general certification of compliance with the Student Code of Conduct and explaining CLS's "potential conflict." (doc. # 74 at 6:14-21; id. at Ex. A at 1.) CLS's letter, however, did not seek focused exclusion of homosexuals. Rather, the letter described CLS's Statement of Faith as:
requir[ing] that officers and members live moral lives in accordance with orthodox Christian belief including the Biblical prohibition of sexual activity or practice outside of heterosexual marriage (this includes a prohibition against adultery, sexual promiscuity, homosexual activity, and pornography). A person who engages in prohibited sexual conduct or adheres to the viewpoint that prohibited sexual conduct is not sinful would not be permitted to serve as a CLS chapter officer or member. . . . To be clear, [CLS] does not prohibit any person from becoming a member or officer solely on the basis of their status as an individual whose sexual inclinations are toward those of the same sex, but it does require that its voting members and officers agree with the theological and creedal belief that prohibited sexual conduct is sinful, that they repent of any such conduct, and that they not engage in such conduct.
( Id. at Ex. A at 3.) CLS had thus changed its position; its criterion of exclusion was expanded to oppose all sexual activity outside traditional marriage. CLS was no longer seeking to discriminate against homosexuals as a targeted group. However, CLS did not seek to amend its Complaint to reflect this different claim, and it contends even now that this letter did not alter its position.
The University rejected CLS's application on May 13, 2005, noting that the University could not accept an application which asserted non-compliance with the University's policies. ( Id. at Ex. B at 1.)
Litigation continued through trial preparation and briefing. In its principle brief filed July 28, 2005, CLS asserted no right to exclude homosexuals as such, but only to exclude persons who engaged in or condoned sexual conduct outside traditional marriage. (doc. # 96 at 2:18-25.) In response, the University stated:
In its Motion, CLS-ASU now claims to discriminate against those who engage in "extra-marital sexual conduct." (Op. Br. at 2.) Discrimination on the basis of engaging in extra-marital sexual conduct is not prohibited by University policy. Accordingly (and setting aside CLS-ASU's insistence on discriminating on the basis of religion), if CLS-ASU genuinely only discriminates on the basis of extra-marital sexual conduct — and applies its policy equally to heterosexuals and homosexuals — it would be able to sign the SOCR registration form, and commit to abide by the Nondiscrimination Policy.
(doc. # 101 at 10 n. 4.)
E. The Settlement
The parties then reached a settlement. The stipulated order of dismissal stated that the parties were able to resolve the dispute privately, and the court retained jurisdiction only to rule on attorneys' fees motions. Three paragraphs of the settlement agreement are particularly relevant:
2. SORC Registration Policy Amendment. No later than upon the execution of this Agreement, the University will state and publish in the Student Organization Resource Center ("SORC") registration documents and website wherever the nondiscrimination policy is published the following:
Religious student organizations will not be denied registration solely because they limit membership or leadership positions to students who share the same religious beliefs. These groups, however, may not discriminate in membership or leadership on any other prohibited basis (i.e. age, ethnicity, gender, disability, color, national origin, race, sexual orientation or veteran status).
3. SORC Registration. Simultaneously with the execution of this Agreement, [CLS's] application for registration as a 2005-2006 student organization, without the May 6, 2005 cover letter previously submitted, will be received and granted.
4. University Letter. Simultaneously with the execution of this Agreement, the University will issue to [CLS] a letter in the form attached hereto in Exhibit A.
(doc. # 129 at Ex. C at 2.) The letter referred to in paragraph 4 states in relevant part:
Please be advised that:
. . . .
2. The beliefs and practices of [CLS] that any sexual conduct, whether heterosexual or homosexual, outside of a traditional marriage is morally wrong, do not violate the sexual orientation provision in the non-discrimination policies of the University as they relate to the registration of student organizations. Any complaint filed with the University against [CLS] will be decided consistent with this agreement.
As Vice President for Student Affairs, I represent that I have authority to bind the University with respect to the matters stated in this letter.
( Id. at Ex. C at 7.) Following the settlement agreement, CLS moved for attorneys' fees in the amount of $341,210.80, which reflects $266,161.70 in hourly rate value plus costs of $8,135.68 and a multiplier of 1.25. (doc. # 127 at 2 n. 1.)
III. Prevailing Party
Section 1988 of Title 42, U.S.C., provides that in civil rights litigation the court "may allow the prevailing party, other than the United States, a reasonable attorney's fee." A party's status as "prevailing" is thus a threshold requirement for an award of fees. Hensley v. Eckerhart, 461 U.S. 424, 433 (1983); Tex. State Teachers Ass'n v. Garland Indep. Sch. Dist., 489 U.S. 782, 789 (1989).
A civil rights plaintiff must meet two elements as a prevailing party; the first "requires a material alteration in the legal relationship between the parties," and the second "requires that the material alteration in the relationship between the parties be stamped with some `judicial imprimatur.'" Carbonell v. Immigration Naturalization Servs., 429 F.3d 894, 899, 901 (9th Cir. 2005).
A. Material Change in Legal Relationship
The Supreme Court has articulated a "generous formulation" of the material change element. Farrar v. Hobby, 506 U.S. 103, 109 (1992) (citing Hensley, 461 U.S. at 433). The element is satisfied "[i]f the plaintiff has succeeded on any significant issue in litigation which achieved some of the benefits the parties sought in bringing suit." Tex. State Teachers Ass'n, 489 U.S. at 791-92 (citations, alterations and internal quotations omitted). This "inquiry does not turn on the magnitude of the relief obtained"; although "the size of the relief may impact the size of the eventual fee award, it does not affect eligibility for a fee award." Fischer v. SJB-P.D. Inc., 214 F.3d 1115, 1119 (9th Cir. 2000) (citations and internal quotations omitted). Even nominal damages of one dollar may thus constitute a material change in the parties' relationship. Farrar, 506 U.S. at 112.
CLS has achieved through private settlement agreement a sufficient alteration of the parties' legal relationship. The ability "to enforce a judgment, consent decree, or settlement against the defendant" will generally satisfy the material change element because "the plaintiff can [thereafter] force the defendant to do something he otherwise would not have to." Barrios v. Cal. Interscholastic Fed'n, 277 F.3d 1128, 1134 (9th Cir. 2002) (citing Fischer, 214 F.3d at 1118)); accord Richard S. v. Dep't of Developmental Servs., 317 F.3d 1080, 1087 (9th Cir. 2003). The University has abandoned its policy, never before enforced but articulated in this litigation, against recognizing religiously-exclusive student organizations in general.
CLS may also compel the University to post notices on its forms and web sites that religious groups may discriminate on the basis of certain shared religious beliefs, so long as the discrimination is not also based on any protected characteristic. (doc. # 129 at Ex. C at 2 at ¶ 2.) A comparable settlement agreement was held to effect a material change in the litigants' legal relationship in Fischer, 214 F.3d at 1115. In Fischer, the Cedar Creek Inn agreed to insert an expanded nondiscrimination statement into its policy manual and to post the statement conspicuously. Id. at 1120. The court held that the parties' relationship was significantly changed, given that such a statement would "go a long way toward educating the Inn's employees and agents that it is illegal to deny access to people who use service dogs." Id. The court reached this conclusion despite the fact that the language only added "a few sentences" to the Inn's prior nondiscrimination policy. Id.
B. Judicial Imprimatur
The settlement agreement also satisfies the requirement of judicial imprimatur. Generally, "in order to be considered a `prevailing party' . . . a plaintiff must not only achieve some material alteration of the legal relationship of the parties, but that change must also be judicially sanctioned." Shapiro v. Paradise Valley Unified Sch. Dist., 374 F.3d 857, 865 (9th Cir. 2004) (citations and internal quotations omitted). The University argues that private settlement agreements lack judicial imprimatur under Buckhannon Board Care Home, Inc. v. West Virginia Department of Health Human Services, 532 U.S. 598 (2001). In Buckhannon, the Court distinguished voluntarily-conceded relief from court-ordered forms of relief like judgments on the merits and consent decrees. Id. at 604-05. Although no settlement agreement was involved, the Court further stated in dictum that relief obtained through private settlement agreements would not support an award of attorneys' fees unless the agreement was incorporated into a court order. Id. at 604 n. 7.
The Ninth Circuit has consistently rejected Buckhannon's dictum that settlement terms must be incorporated into a court order to allow a fee award. Barrios, 277 F.3d at 1134 n. 5; Richard S., 317 F.3d at 1086-87; see also Perez-Arellano v. Smith, 279 F.3d 791, 795 n. 5 (9th Cir. 2002). Ninth Circuit authority controls here. In Barrios, as here, the parties agreed to a court decision on attorneys' fees, without judicial incorporation or enforcement of the settlement. 277 F.3d at 1133, 1134 n. 5. The court's retention of jurisdiction over attorneys' fees "provid[ed] sufficient judicial oversight." Id. at 1134 n. 5. Under Barrios, CLS meets the requirement of judicial imprimatur.
IV. Amount of Fee
Having determined that CLS is a prevailing plaintiff under 42 U.S.C. § 1988, the court must determine the amount of fees appropriate to award CLS. "The most useful starting point for determining the amount of a reasonable fee is the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate." Hensley, 461 U.S. at 433. This yields what is referred to as the "lodestar." Caudle v. Bristow Optical Co., 224 F.3d 1014, 1028 (9th Cir. 2000). After calculating the lodestar, "other considerations . . . may lead the district court to adjust the fee upward or downward, including the important factor of the `results obtained.'" Hensley, 461 U.S. at 433 (footnote omitted). There is a strong presumption, however, that the lodestar figure represents a reasonable fee. Morales v. City of San Rafael, 96 F.3d 359, 364 (9th Cir. 1996).
A. Determination of Reasonable Fees for the Level of Success
The University has not objected to CLS's hourly rate values for service rendered, and the court finds them reasonable. Nor has the University objected to any specific services or the claimed $266,262.70 value of CLS's counsel's services in general, and the court finds that value reasonable. The court also considers the other factors bearing on the reasonableness of fees. Morales, 96 F.3d at 364 n. 8; Kerr v. Screen Guild Extras, Inc., 526 F.2d 67, 70 (9th Cir. 1975). With the exception of results obtained, those pertinent factors do not warrant departure from the lodestar amount claimed by CLS.
In determining the hours reasonably expended, "two questions must be addressed. First, did the plaintiff fail to prevail on claims that were unrelated to the claims on which he succeeded? Second, did the plaintiff achieve a level of success that makes the hours reasonably expended a satisfactory basis for making a fee award?" Hensley, 461 U.S. at 434. The court addresses these two inquiries in turn.
1. Relatedness of Claims
"If the plaintiff has prevailed on some claims but not on others, the court must evaluate whether the successful and unsuccessful claims are distinctly different claims for relief that are based on different facts and legal theories or whether they involve a common core of facts or are based on related legal theories." Schwartz v. Sec'y of Health Human Servs., 73 F.3d 895, 901 (9th Cir. 1995) (internal citations, alterations and quotations omitted). Determining the relatedness of claims is not a precise science. Webb v. Sloan, 330 F.3d 1158, 1169 (9th Cir. 2003); see also Hensley, 461 U.S. at 437 n. 12 ("We recognize that there is no certain method of determining when claims are `related' or `unrelated.'"). As a starting point, though, it can be assumed that civil rights cases involving unrelated claims are encountered infrequently. See Hensley, 461 U.S. at 435.
"[T]he test is whether relief sought on the unsuccessful claim is intended to remedy a course of conduct entirely distinct and separate from the course of conduct that gave rise to the injury on which the relief granted is premised." Schwarz, 73 F.3d at 903 (citations and quotations omitted). Claims are thus unrelated only if the "successful and unsuccessful claims are distinctly different both legally and factually." Dang v. Cross, 422 F.3d 800, 813 (9th Cir. 2005) (citations and internal quotations omitted) (emphasis in original). The court should also ask "whether it is likely that some of the work performed in connection with the unsuccessful claim also aided the work done on the merits of the successful claim." Schwarz, 73 F.3d at 903 (alterations omitted) (citing Herrington v. County of Sonoma, 883 F.2d 739, 747 (9th Cir. 1989)). Once separated, any work performed on claims unrelated to winning claims is not compensable. Hensley, 461 U.S. at 435.
Here, CLS's failed claims — targeted exclusion of homosexuals in practical terms and its Establishment Clause claim in doctrinal terms — were not wholly unrelated to CLS's successful claim based on a general but otherwise nondiscriminatory exclusion of persons for lack of shared religious beliefs. The practical results of the successful and unsuccessful claims were or would have been materially different, but CLS's claims were "premised on the same set of circumstances," at least in the minimal sense to allow their further consideration in the level of success. Cabrales v. County of Los Angeles, 864 F.2d 1454, 1466 (9th Cir.), vacated, 490 U.S. 1087, and reinstated, 886 F.2d 235 (1989). Work on each constitutional claim, moreover, surely overlapped with work on the others, especially considering the overlapping nature of the religion clauses. Because this case "cannot be viewed as a series of discrete claims," Sorenson v. Mink, 239 F.3d 1140, 1147 (9th Cir. 2001) (citations and internal quotations omitted), the court need not disregard any of CLS's counsel's hours as performed on wholly unrelated claims.
However, this analysis is only a preface to the important inquiry about levels of success among those related claims.
2. Level of Success
The law authorizes the district court to reduce a fee award for lack of complete success. McGinnis v. Kentucky Fried Chicken, 51 F.3d 805, 801 (9th Cir. 1994) ("It is an abuse of discretion for the district court to award attorneys' fees without considering the relationship between the extent of success and the amount of the fee award." (citations and internal quotations omitted)); Cabrales, 864 F.2d at 1466 n. 11; Morales, 96 F.3d at 364; accord Caudle, 224 F.3d at 1029 n. 11 ("If . . . a plaintiff has achieved only partial or limited success, the lodestar figure may be an excessive amount. This will be true even where the plaintiff's claims were interrelated, nonfrivolous, and raised in good faith." (citations, quotations and alterations omitted)). In determining the amount of fees reasonably awarded, success is the "crucial factor." Hensley, 461 U.S. at 440. Here, the award must reflect CLS's predominant lack of success in this litigation.
i. Benchmark of Success
To measure success, the court must find the plaintiff's goals in bringing the action and compare them to the final results of the litigation. See Harris v. Marhoefer, 24 F.3d 16, 18-19 (9th Cir. 1994) ("The degree of the plaintiff's success in relation to the . . . goals of the lawsuit is a factor critical to the determination of the size of a reasonable fee. . . ." (emphasis omitted; citing Texas State Teachers Ass'n, 489 U.S. at 790)). Where, as here, the plaintiff's objectives materially changed in the course of the litigation, the court must decide which objectives are the benchmark of success. In this case, two options are salient: (1) CLS's stated position in its Complaint, never amended, and (2) CLS's stated position in the May 6, 2005 letter appended to CLS's application for registration and in its July 28, 2005 brief on the merits (doc. # 96). The court concludes that CLS's success on the sexual discrimination claim should be measured against CLS's goals apparent in its Complaint, for three main reasons.
First, out-of-court assertions by counsel for a party in litigation are not necessarily binding and must be understood in light of the ongoing litigation. Although the May 6, 2005 letter communicated a different position than alleged in the Complaint and in CLS's September 29, 2004 letter, CLS did not commit to the new position in a legally binding way upon which the University could rely. The University could not be expected upon receiving the May 6 letter to ignore CLS's Complaint, which described CLS's demand to discriminate against homosexuals as a targeted group.
This principle has particular force here. In a prior court filing CLS affirmed that it did not consider itself restricted by the contents of CLS counsel's extrajudicial letters. In responding to the University's motion to dismiss CLS's Establishment Clause claim, CLS asserted that theories expressed in a prior extrajudicial letter in no way limited the range of permissible arguments that CLS could make before the court. (doc. # 32 at 11.) Where a party has specifically repudiated the legal effect of its out-of-court statements, logic and fairness should disincline the court to charge the opposing party with finding in them legal significance in derogation of the operative Complaint.
Second, CLS did not acknowledge in the May 6, 2005 letter that it was changing its position. ( See doc. # 74 Ex. A.) To the contrary, the May 6 letter refers approvingly to CLS's earlier September 29, 2004 letter, which paralleled the Complaint in terms of homosexual targeting. ( Id. at Ex. A at 1.) CLS's May 25, 2005 Response to Show Cause Order (doc. # 74), which attached the May 25, 2005 letter, is also silent about its change in position. Not even on this attorneys' fees motion does CLS admit its change of position. This further suggests the unfairness of charging the University with recognizing CLS's change of posture without an amendment of its Complaint or other legally binding retrenchment.
Third, it strains judicial resources to permit parties who extrajudicially change their position to call upon the court to investigate a course of litigation dealings or negotiations. As noted generally by the Supreme Court, "[a] request for attorney's fees should not result in a second major litigation." Hensley, 461 U.S. at 437. Parties who do not amend their pleadings or otherwise formally and clearly commit to a new and retrenched position should not be heard to say on an attorneys' fees motion that a course of extrajudicial dealings inconsistent with their unamended pleadings provides the new measure of their objectives and success in the litigation.
ii. CLS's Objectives at the Beginning
Having decided that CLS's objectives in its Complaint are the appropriate benchmark of CLS's success, the court must determine what they were. CLS's main goal in this litigation was to establish a principle that CLS's religion-based rights trumped the University's sexual orientation nondiscrimination policy prohibiting express discrimination against homosexuals by University-aided student organizations. The Complaint evidences this primary litigation objective, describing CLS's policy in terms of homosexual exclusion.
Other circumstances confirm that CLS sought predominantly to establish the principle that CLS could target homosexuals for exclusion. The September 29, 2004 letter requesting an exemption from the University's nondiscrimination policy spoke in terms of purely homosexual discrimination (doc. # 142 Ex. 11 at 2), as does other correspondence in the record. ( E.g., id. at Ex. 14 at 1288 ("Speculative future attempts by homosexuals to become leaders is one of the reasons we filed the suit. We want to make sure we end up with the right to exclude practicing homosexuals.").)
iii. CLS's Original Objectives Compared to the Results Achieved
In light of CLS's dominant objective, this litigation was only modestly successful. To be sure, CLS is entitled to "prevailing party" status, having obtained binding commitments to its right to discriminate generally on the basis of shared religious beliefs — although not specifically against homosexuals. The settlement agreement states: "These groups, however, may not discriminate in membership or leadership on any other prohibited basis (i.e., age, ethnicity, gender, disability, color, national origin, race, sexual orientation or veteran status)." (doc. # 129 Ex. C at 2 at ¶ 2 (emphasis added); id. at Ex. C at 7 at ¶ 1.) The circumstances leave some doubt whether at the outset the University would have opposed a general claim to benign religious exclusion as a stand-alone issue, unconnected with the specific claim to religiously entitled exclusion of homosexuals as such. But the University did raise that objection and then relented in the settlement. The University must pay an amount that is reasonable for that success achieved.
However, the settlement abandoned CLS's claim to discriminate against homosexuals as such, confirming a right to discriminate of a very different kind. CLS ended the litigation with a previously uncontested right to exclude all persons who engage in extramarital sexual conduct, "whether heterosexual or homosexual." ( Id. at Ex. C at 7 at ¶ 2.) But any registered group could exclude by that broader classification because it does not violate any specification of the University's nondiscrimination policy. Only a general and even-handed exclusion is permitted, by a criterion that does not single out by sexual orientation.
This even-handed criterion disparately impacts homosexuals, cf. Alexander v. Sandoval, 532 U.S. 275, 282-85 (2001) (distinguishing direct discrimination from disparate impact), but the invidiousness of the resulting discrimination is greatly diminished. While invidious classification and disparate impact from general classification each has its sting, they differ in their social, psychological, political, moral, and educational character. The University could reasonably understand invidious classification — targeting homosexuals as such — as destructive of the learning environment but disparate impact discrimination as less so. The University never relented in resisting the first and never opposed the second. At the end of the battle, CLS held ground for which it needed no army, and the University held ground which was the declared cause of war.
Considering the importance of invidious classification in this litigation and the fact that the University turned back CLS's claim to target homosexuals as such for exclusion, the relief actually obtained by CLS, "however significant, [was] limited in comparison to the scope of the litigation as a whole." Harris v. Marhoefer, 24 F.3d 16, 19 (9th Cir. 1994) (quotations omitted) (citing Hensley, 461 U.S. at 440).
3. Application of Discretionary Reduction of Fees
A "district court should award only those fees which are reasonable in relation to the result obtained." Transgo, Inc. v. Ajac Transmission Parts Corp., 768 F.2d 1001, 1027 (9th Cir. 1985) (citations omitted). Where a plaintiff, as here, is only partially successful, the court exercises its discretion "to arrive at a reasonable fee award, either by attempting to identify specific hours that should be eliminated or by simply reducing the award to account for the limited success of the plaintiff." Tex. State Teachers Ass'n, 489 U.S. at 789-790 (citations omitted).
Reduction of the attorney hours by a reasoned percentage is permissible under the Ninth Circuit rule that "a district court does not abuse its discretion when it resorts to a mathematical formula, even a crude one, to reduce the fee award to account for limited success." Schwarz v. Sec'y of Health Human Servs., 73 F.3d 895, 905 (9th Cir. 1995). In Marhoefer, 24 F.3d at 16, for example, the Ninth Circuit affirmed a district court's reduction in fees of 50% "based upon the `results obtained,' i.e., the amount of damages recovered versus the amount sought, and the number of claims prevailed upon versus the number of claims dismissed or decided in defendant's favor." Id. at 18 (citations omitted). While the Ninth Circuit has reversed lower court decisions utilizing the "meat axe" approach to reduce excessive or duplicative billings that inadequately articulate the reasons for selecting the specified percentage reduction, e.g. Gates v. Deukmejian, 987 F.2d 1392, 1400 (9th Cir. 1992) (reversing 10% reduction based on overlap or duplication in work), percentage reductions can be "acceptable, and perhaps necessary, tools for district courts fashioning reasonable fee awards." Id. Where other methodologies are not available to reduce the award to an amount commensurate with the level of success, percentage reductions will be upheld. Webb v. Sloan, 330 F.3d 1158, 1167-68 (9th Cir. 2003) (district court did not err in reducing number of hours by 25% to reflect limited success although reversal on other grounds was appropriate); Schwarz, 73 F.3d at 904-905 (district court did not err in reducing hours by 25% to reflect lack of success); Corder v. Gates, 947 F.2d 374, 378 (9th Cir. 1991) ("It is clear that a 20% reduction for limited success is in some cases sustainable."). "The court necessarily has discretion in making this equitable judgment." Hensley, 461 U.S. at 436-37.
From the foregoing discussion the court concludes that a fee award should and must be reduced for the services challenging the University's sexual orientation nondiscrimination policy. When in its principal brief CLS omitted its prior claim to targeted homosexual exclusion, the University promptly stated what it surely would have said if CLS had taken the same position before suit: that the sexual orientation nondiscrimination policy does not prohibit exclusionary criteria applicable to heterosexuals and homosexuals alike. (doc. # 101 at 10 n. 4.) It was not necessary for CLS to prosecute a lawsuit to learn that or to decide what its own goals were.
The task, then, is to quantify CLS's success on the benign religious exclusion issue, with allowance for overlap in work between it and the failed claims. This court has reviewed afresh all the briefs in this case. The court has labored through CLS's time entries, and they are simply not amenable to the preferred method of fee reduction by excluding identified entries from the loadstar calculation. The time entries are overwhelming general in their descriptions of work on the case and leave little basis to quantify how much was expended on the failed sexual orientation claim, the religious association claim as integral to the failed sexual orientation claim, the religious association claim as foundation for the later-adopted general sexual immorality claim, or (the principal claim for which CLS should be compensated) the claim to exclude for lack of shared religious beliefs that do not violate another University standard of non-discrimination. It is possible to ascertain most of the work on the failed Establishment Clause claim, which is about $12,137.05 for services roughly between December 20, 2004 and April 15, 2005. But even with that limited quantification, to which the court gives consideration, the time entries as a whole do not provide a workable method for reducing the hours expended to account in a principled way for CLS's predominant lack of success in this litigation.
The court must look to its own familiarity with the extensive work done in this case and make its best assessment of the relative importance and demands on lawyers' time of the successful and unsuccessful parts of CLS's case. Based on all those considerations, the court finds 20% of the time and value expended is enough, probably more than enough, to account for CLS's actual success in this case. That reasonable attorneys' fee is $55,000, which is approximately 20% of the $266,262.70 in attorneys' services at their hourly rate value and $8,135.68 in reimbursable attorneys' expenses.
B. CLS's Request for a Multiplier
A multiplier "is justified only in the rare case where there is specific evidence that the quality of service was superior in light of the hourly rates charged and the success was exceptional." Van Gerwen v. Guarantee Mut. Life Co., 214 F.3d 1041, 1046 (9th Cir. 2000) (citations omitted); accord Chalmers v. City of Los Angeles, 796 F.2d 1205, 1215 (9th Cir. 1986) ("[A]n upward adjustment of an award of fees by use of a multiplier is justified only in rare, exceptional circumstances." (citations omitted)). "[N]either the novelty of the issues, the complexity of the case, nor the quality of the representation justifies application of a multiplier." Chalmers, 796 F.2d at 1215 (citing Blum v. Stenson, 465 U.S. 886, 898-99 (1984)).
CLS's grounds for a multiplier in this case are clearly insufficient. As discussed above, most of the University's resistence in the litigation was to CLS's original position, which CLS later abandoned.
V. Motion for Expenses
CLS also seeks reimbursement of its expenses incurred during the litigation, including the costs of transportation, parking, car rentals, food, transcripts, depositions, and mail/couriers. The University argues that CLS's motion is barred by Local Rule LRCiv. 54.1(d), which states:
(d) Prevailing Party Entitlement to Costs. The party entitled to costs shall be the prevailing party. Generally, a party in whose favor judgment is rendered is the prevailing party. The prevailing party need not succeed on every issue to be entitled to costs. Upon entry of judgment on a motion for summary judgment, the party requesting the summary judgment is the prevailing party. The Court will not determine the party entitled to costs in actions terminated by settlement; parties must reach agreement on taxation of costs, or bear own costs.
(Emphasis added.) Since LRCiv. 54.1(d) precludes settling litigants from claiming taxable costs where they have not agreed who is the "prevailing party," no taxable costs will be awarded.
However, "[u]nder § 1988, [a plaintiff] may recover as part of the award of attorney's fees those out-of-pocket expenses that would normally be charged to a fee paying client." Marhoefer, 24 F.3d at 19 (citations and internal quotations omitted); accord Davis v. City County of San Francisco, 976 F.2d 1536, 1556 (9th Cir.) ("[W]e have continued to hold that attorneys' fees awards can include reimbursement for out-of-pocket expenses including the travel, courier and copying costs . . . incurred here."), vacated in part on other grounds, 984 F.2d 345 (1993). A local rule barring taxation of costs will not preclude award of these same expenses as a part of the attorneys' fees award. Marhoefer, 24 F.3d at 20.
The court has already taken account of the $8,135.68 in litigation expenses and has awarded CLS the same 20% determined to reflect CLS's degree of success in the case as a whole. The University has not argued that CLS's expenditures were unnecessary or unreasonable, see Marhoefer, 24 F.3d at 20, and the court finds CLS's claimed expenses reasonable and made in good faith. IT IS THEREFORE ORDERED that Plaintiff Christian Legal Society's Motion for Attorney's Fees and Costs (doc. # 123) is granted in part. The clerk shall enter judgment for the Plaintiff Christian Legal Society Chapter at Arizona State University College of Law against Defendants in their official capacity only, in the amount of $55,000.00.