Rena C. v. Colonial School District ( 2020 )

NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_____________
No. 20-1694
_____________
RENA C., Individually and on behalf of A.D.,
Appellant
v.
COLONIAL SCHOOL DISTRICT
_______________
On Appeal from the United States District Court
for the Eastern of Pennsylvania
(D.C. No. 2-15-cv-01914)
District Judge: Hon. Timothy J. Savage
_______________
Submitted Under Third Circuit LAR 34.1(a)
November 16, 2020
Before: JORDAN, KRAUSE, and RESTREPO, Circuit Judges.
(Filed: December 16, 2020)
_______________
OPINION ∗
_______________
∗
This disposition is not an opinion of the full court and, pursuant to I.O.P. 5.7,
does not constitute binding precedent.
JORDAN, Circuit Judge.
This case under the Individuals with Disabilities Education Act (“IDEA”) comes
before us for a second time, once again on a dispute over the amount of attorneys’ fees
awarded to the prevailing party, Rena C. Having concluded that the District Court did
not appropriately apply the operative legal principles for assessing fees, we will vacate
the fee order and remand for reconsideration.
I. BACKGROUND
A. The Administrative Background
Rena C.’s child, A.D., was enrolled in private school because the defendant school
district, Colonial, “had failed to provide a free, appropriate public education” that
supported A.D.’s needs and is “required by the IDEA.” Rena C. v. Colonial Sch. Dist.,
890 F.3d 404, 411 (3d Cir. 2018). Pursuant to an administrative determination, Colonial
was ordered to reimburse Rena C. for A.D.’s private school tuition “until Colonial
convened an appropriate IEP [that is, Individualized Education Program] meeting.” Id.Following that determination, in June 2014, Colonial offered an IEP to return A.D.
to a public school in the district. Id. Rena C., however, disputed the IEP’s adequacy and,
at the end of the summer, notified Colonial that she intended to enroll A.D. in private
school again for the following school year, “request[ing] reimbursement for tuition and
related expenses.” Id. Colonial claimed the new IEP was adequate and therefore the
school district had no obligation to reimburse any educational expenses. Id. Rena C.
then filed an administrative complaint challenging the adequacy of the IEP and seeking
“declaratory relief and reimbursement for private tuition and associated costs (‘tuition
2
reimbursement’) arising from [A.D.]’s private placements” for the relevant school years.
Id. (alteration in original) (internal quotation marks and citations omitted).
On September 18, 2014, prior to the administrative hearing on that complaint,
Colonial provided Rena C. with a written offer, agreeing to pay for A.D.’s private school
tuition and transportation. Id. She rejected the offer, claiming it was not valid and “was
inadequate for failing to address attorney’s fees or pendency.”1 Id. “The parties
attempted negotiation, but eventually proceeded to an administrative hearing[,]” engaged
in mediation, and ultimately “stipulated to a consent order entered by an administrative
hearing office providing for tuition, one-on-one instruction support, transportation, and
pendency at” a private school. Id. at 411-12.
B. The District Court’s First Order Awarding Attorneys’ Fees
As the prevailing party in the underlying administrative matter, Rena C. filed a
claim in the District Court for reasonable attorneys’ fees pursuant to 20 U.S.C.
§ 1415(i)(3)(B)(i)(I). The Court granted summary judgment on her claim, agreeing that
she was eligible to recover attorneys’ fees as the prevailing party. But, pursuant to
IDEA’s fee provisions, the Court imposed a temporal limitation, permitting her recovery
only for the fees she accrued before Colonial had extended its written settlement offer.
See id. § 1415(i)(3)(D)(i), (E) (barring reimbursement of attorneys’ fees “for services
1
“Pendency refers to a student’s right under the IDEA to ‘stay-put’ in the current
educational placement. The ‘stay-put’ provision … requires the school district to
continue to pay for the ‘then-current educational placement’ during the pendency of
proceedings resolving placement disputes.” Rena C., 890 F.3d at 415 (citing 20 U.S.C.
§ 1415(j)).
3
performed subsequent to the time of a written offer of settlement to a parent if[,]” among
other things, “the court … finds that the relief finally obtained by the parents is not more
favorable to the parents than the offer of settlement” unless the parents were
“substantially justified in rejecting the settlement offer” (emphasis added)). The Court
determined that the relief Rena C. finally obtained was not more favorable to her than
Colonial’s offer of settlement. And Rena C. was, therefore, statutorily barred from
recovering post-offer attorneys’ fees, unless she was “substantially justified in rejecting”
that offer. Id. § 1415(i)(3)(E).
On that point, the District Court concluded that Rena C. was not substantially
justified. It reasoned that, since she could have “raise[d] her concerns regarding
attorney’s fees” sooner, “there was no real dispute about attorney’s fees at the time the
offer was made[.]” (App. at 110.) And thus, according to the Court, Rena C. “and her
counsel unnecessarily protracted the litigation” by “persisting in her frivolous
arguments.” (App. at 110-11.)
On those bases, it “award[ed] her attorney’s fees only for work performed to
September 28, 2014, the date [Colonial’s] ten-day offer expired.” (App. at 111.)
C. Reversal and Remand
Rena C. appealed that order, contending that she was entitled to recover post-offer
attorneys’ fees. Rena C., 890 F.3d at 412-13. She advanced several alternative
arguments in support of her challenge. First, she claimed she was not statutorily barred
from recovering attorneys’ fees accrued after Colonial’s offer because the offer was not
valid and “she received more favorable relief in the administrative order than Colonial
4
had included in [its] offer.” Id. at 412. We disagreed and concluded that “[t]he bar of 20
U.S.C. § 1415(i)(3)(D)(i) therefore applies and … prevent[s] [Rena C.] from receiving
[post-offer] attorney’s fees … unless she was substantially justified in rejecting
Colonial’s offer.” Id. at 417.
The next issue, then, was whether Rena C. was substantially justified in rejecting
the offer and therefore exempt from the statutory bar. We decided she was, observing
that “[t]en-day offer letters should not permit school boards to force parents to choose
between securing an appropriate placement for their child and obtaining the attorney’s
fees to which they would otherwise be statutorily entitled.” Id. at 418; see also id. at 420(“A parent is substantially justified in rejecting an offer that does not include the payment
of reasonable attorney’s fees when the school district cannot reasonably believe that no
attorney’s fees have accrued.”). Consequently, we did not reach her remaining
arguments. Id. at 413. We “reverse[d] and remand[ed] to the District Court for
calculation of reasonable attorney’s fees … consistent with [our] holding that Rena C.
was substantially justified in rejecting the [written] offer under 20 U.S.C.
§ 1415(i)(3)(E).” Id. at 420.
D. The District Court’s Second Order Awarding Attorneys’ Fees
On remand, the District Court again considered Rena C.’s application for
attorneys’ fees, this time including fees requested for post-offer work. After deciding
upon the hourly rate, 2 the Court addressed counsel’s time entries, which amounted to
2
The District Court adopted the hourly rate and annual increase laid out in Rena
C.’s original fee agreement. It awarded a “base rate of $350 with annual increases of five
5
593.4 hours.3 It began by itemizing and deducting as “duplicative and excessive” the
following entries:
• “1.3 hours spent on the Right to Know Law requests” because “a comparison
between the hours billed by Colonial’s counsel and [Rena C.’s counsel] is not
helpful[,]” (App. at 17);
• 47.1 hours “out of the 94.2 hours of block-billing for which no time was already
deducted” voluntarily, where the Court chose to “split the difference” and
deduct half the time because it only “approve[d] time reasonably correlated to
permissible” or “reimbursable tasks”; 4 found that “these entries include[d] some
reimbursable tasks”; and couldn’t “determine how much of the total time [for
block-billed entries] [was] allocable to each activity[,]” (App. at 19);
• “3.9 hours … for administrative-type tasks” that “could have been easily
delegated to a paralegal or secretary[,]” (App. at 19-20 (citation omitted));
• 17.45 hours out of “34.9 hours entered for interoffice communications and
communications with the referring attorney” as excessive, (App. at 20);
• 0.5 hours for entries “appear[ing] duplicative[,]” (App. at 20); and
percent[.]” (App. at 13). The Court then calculated the average rate, presumably based
upon that formulation, “bringing [lead counsel’s] hourly rate to $437.50.” (App. at 13.)
Though Rena C. briefly questions this aspect of the award, “[w]e believe that the better
practice in raising such computational challenges is first to bring a motion for
reconsideration in the district court. It is difficult for the Court of Appeals to reconstruct
the mathematics used by the district judge, and thus difficult for us to assess the merits of
such claims.” Bell v. United Princeton Props., Inc., 884 F.2d 713, 725 (3d Cir. 1989).
Because remand is already appropriate on other grounds, as described herein, “we will
leave [Rena C.’s] allegations of computational error for the [D]istrict [C]ourt to consider
on remand.” Id.3
Already excluded were 67.9 hours that Rena C.’s attorneys “voluntarily
deducted … that could be considered excessive, redundant[,] or unnecessary, including
reducing time that Colonial objected to during the initial fee petition proceedings.” (App.
at 14.)
4
The District Court did not explain what constituted “permissible” or
“reimbursable tasks.” (App. at 19.)
6
• “0.2 hours for one entry … reviewing a timesheet[.]” (App. at 20.)
The time entries above accrue to a total of 70.45 hours deducted as “duplicative
and excessive[,]” adjusting the total hours to 522.95 hours. 5 (App. at 20.)
The Court then “consider[ed] two additional principles governing” its calculation
of attorneys’ fees: “[t]he extent of [Rena C.’s] success” under the Supreme Court’s
guidance in Hensley v. Eckerhart, 461 U.S. 424 (1983), and the IDEA’s bar to recovering
post-offer attorneys’ fees “if the relief obtained was not more favorable than [Colonial’s]
offer.” (App. at 21 (citations omitted).) According to the Court, “applying these two
principles requires [it] to reduce the time spent on those issues on which Rena did not
prevail or had been included in Colonial’s … offer.” (App. at 21.)
Predicated on its interpretation of Hensley, the Court found that Rena C. had only
prevailed on one issue, her “entitlement to attorney’s fees.” (App. at 21.) It deducted
“16.1 hours spent on the issues of expert fees and the validity of the offer” and further
determined that any time spent litigating “one-on-one instruction and pendency” was “not
compensable[,]” since those terms were part of Colonial’s offer. (App. at 22-23.) And
5
Rena C. challenges the District Court’s determination that the list of time entries
deducted thus far amounts to “86.55 hours as duplicative and excessive, adjusting the
total hours to 506.85 hours.” (App. at 20.) While there is a 16.1-hour discrepancy
between our calculation and the District Court’s, it appears that the Court may have
prematurely incorporated into its calculation the deductions of “time entries for issues on
which Rena did not prevail[,]” which amounted to 16.1 hours. (App. at 21-22.) On
remand, the District Court should provide “a concise but clear explanation of its reasons”
for this reduction. Hensley v. Eckerhart, 461 U.S. 424, 437 (1983). If the premise on
which that deduction is grounded is a consideration of whether Rena C. prevailed on an
issue-by-issue basis, our discussion herein describes why we believe that is not
analytically sound. See infra Section II.A.
7
because her counsel did “not allocate time” on an issue-by-issue basis, the Court assumed
Rena C.’s counsel “spent at least the same amount of time on the issues related to Rena’s
child’s interest as he did on his fees[,]” determined that the block-billing approach should
therefore apply, and “split the difference.” (App. at 23.) In other words, after identifying
86.55 specific hours to eliminate, it applied a further wholesale reduction, dividing the
remaining 506.85 hours in half and concluding that 253.425 hours was reasonable.
Rena C. has timely appealed again, challenging the District Court’s second order
awarding attorneys’ fees.
II. DISCUSSION6
According to Rena C., the District Court erred in concluding that she can only
recover post-offer attorneys’ fees accrued on issues on which she was the prevailing party
and which were not included in Colonial’s offer. She contends that the Court’s decision
is contrary to the rules set forth in Hensley for calculating fees and is unfaithful to the law
of the case, as set forth in our earlier decision in this matter. She also challenges the
Court’s decision to split the fee award in half “based on the unsupported assumption that
[her attorneys] spent equal time working on prevailing and non-prevailing arguments.”
(Opening Br. at 23.) Lastly, she argues that the Court miscalculated counsel’s hourly rate
6
The District Court had jurisdiction under 28 U.S.C. §§ 1331 and 1343. We have
jurisdiction pursuant to 28 U.S.C. § 1291.
8
and the total hours designated as excessive or redundant. 7 We agree that remand is in
order.
A. Rena C. is eligible to recover reasonable attorneys’ fees for time spent
on the validity of the offer, pendency, and the terms originally included
in Colonial’s offer. 8
The central concern on appeal is the District Court’s “consider[ation of]
two … principles governing the awarding of attorney’s fees.” (App. at 21.) The first is
the “degree of success” factor described in Hensley, under which the Court found that
Rena C. had “spent a significant amount of time pursuing several issues[,]” but only
“prevailed on one – entitlement to attorney’s fees.” (App. at 21.) The second is the
statutory bar to recover attorneys’ fees “for services performed” post-offer, which,
according to the Court, applied since “the relief [Rena C.] obtained was not more
7
In addition, Rena C. asks that her case be reassigned to a different district judge
on remand. Reassignment is a remedy we consider “exceptional,” “weigh seriously[,]
and order sparingly,” and, as a general rule, only when a “judge’s impartiality might
reasonably be questioned.” Arrowpoint Capital Corp. v. Arrowpoint Asset Mgmt., LLC,
793 F.3d 313, 329 (3d Cir. 2015) (citations omitted). There is no basis to do so here.
While we agree that the Court’s calculations involved erroneous applications of the
relevant legal standards in Hensley and Rena C., “adverse rulings – even if they are
erroneous – are not in themselves proof of prejudice or bias.” Id. at 330 (citations
omitted). Here, as further explained in this opinion, the District Court conflated the
relationship between the statutory provisions directed towards entitlement to fees and
those provisions directed towards adjustments to fees. Compare 20 U.S.C.
§ 1415(i)(3)(B), (D), (E) (permitting or prohibiting attorneys’ fees), with id.§ 1415(i)(3)(F), (G) (reducing attorneys’ fees). But that does not indicate, nor does the
record suggest, that the District Court’s impartiality can reasonably be questioned.
8
“Although ordinarily we review attorneys’ fees rulings for abuse of discretion,
our review is plenary where, as here, the district court based its denial on legal
conclusions.” M.R. v. Ridley Sch. Dist., 868 F.3d 218, 223 (3d Cir. 2017).
9
favorable than the offer.” (App. at 21.) Combining these principles, the Court concluded
it was “require[d] … to reduce the time spent on those issues on which Rena did not
prevail or had been included in Colonial’s … offer.” (App. at 21.)
1. As the prevailing party in an action involving a single claim for
relief, Rena C.’s fee award need not necessarily be reduced
based on a failure to prevail on every contention raised.
When determining a fee award, an important factor “that may lead the district
court to adjust the fee upward or downward” is the prevailing party’s “degree of
success.” Hensley, 461 U.S. at 434, 436. “There is no precise rule or formula for making
these determinations.” Id. at 436. And “[t]he court necessarily has discretion in making
this equitable judgment.” Id. at 437. But that discretion “must be exercised in light of
[certain] considerations” laid out in Hensley. Id. One is the distinction between two
kinds of prevailing parties: a party that succeeds on every claim and a party that “is
deemed ‘prevailing’ even though he succeeded on only some of his claims for relief.” Id.
at 434.
When a party, like Rena C., prevails in an action involving either “only a single
claim” or multiple “claims for relief” that have “a common core of facts or … based on
related legal theories,” the “lawsuit cannot be viewed as a series of discrete claims.
Instead the district court should focus on the significance of the overall relief obtained by
the plaintiff in relation to the hours reasonably expended on the litigation.” Id. at 435. In
doing so, “the fee award should not be reduced simply because the plaintiff failed to
prevail on every contention raised in the lawsuit. Litigants in good faith may raise
alternative legal grounds for a desired outcome, and the court’s rejection of or failure to
10
reach certain grounds is not a sufficient reason for reducing a fee. The result is what
matters.” 9 Id. (emphasis added) (citation omitted).
A district court is thus not supposed to assign prevailing party status on an issue-
by-issue basis as a method of measuring a party’s overall success when calculating
attorneys’ fees. Id. at 435 n.11 (rejecting “a mathematical approach comparing the total
number of issues in the case with those actually prevailed upon” (citation omitted)).
That, however, appears to be what the District Court did here. It divided Rena C.’s claim
for relief into a series of sub-issues, saying that Rena C. had only prevailed on the issue
of “entitlement to attorney’s fees,” and so it reduced her fee award. (App. at 21.) Yet
there is no entitlement to attorneys’ fees without first obtaining “prevailing party” status
as to an actual claim for relief. See Rena C., 890 F.3d at 417 (“To obtain attorney’s fees
in court, parents must be the prevailing party with a judgment on the merits, or a court-
ordered consent decree that creates a ‘material alteration of the legal relationship.’”
(quoting Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep’t of Health & Human Res.,
532 U.S. 598, 604 (2001))).
Here, Rena C.’s IDEA claim arose from Colonial’s failure to offer an IEP
affording her child a free and appropriate public education. She accordingly requested
9
This does not mean a court can never assess a party’s overall success on an issue-
by-issue basis for a single-claim lawsuit. That assessment, however, is better made when
considering the relief sought versus the relief obtained. Where the relief sought differs
from the relief obtained because the prevailing party lost on some issue, that lost issue
directly relates to a party’s lack of success in obtaining the relief it sought. Hensley, 461
U.S. at 438 n.14. But the division on an issue-by-issue basis is not sound where, as here,
the prevailing party obtained all of the relief sought.
11
relief in the form of reimbursement for private tuition and associated costs. And she
prevailed on that claim when an administrative officer issued an order, pursuant to the
parties’ consent decree, awarding her the requested relief. While it may be that the terms
of the administrative order and Rena C.’s entitlement to attorneys’ fees are discrete
issues, they still pertain to a single claim, without which there would be no entitlement to
attorneys’ fees. Rena C. cannot be the prevailing party on the entitlement to attorneys’
fees without also having been the prevailing party on the claim from which that
entitlement derives. 10
Consequently, we will remand for recalculation of reasonable attorneys’ fees. The
District Court maintains its discretion in that process and should exercise it “in light of
the considerations” laid out in Hensley for a prevailing party in a single-claim lawsuit.
461 U.S. at 434-37.
10
To the extent the District Court separately considered Rena C.’s success on
appeal, we likewise conclude that there was error in dividing her single challenge into an
issue-by-issue analysis. Again, it is the result that matters, see Hensley, 461 U.S. at 435,
and the result on her one claim was a victory. We agreed with Rena C. on her first
appeal, concluding that she was eligible for attorneys’ fees accrued after Colonial’s ten-
day offer. Rena C., 890 F.3d at 420. Neither our disagreement on the validity of the
offer and on pendency, nor our decision declining to address alternative grounds,
provides “a sufficient reason for reducing a fee.” Hensley, 461 U.S. at 435.
12
2. Rejecting Colonial’s offer does not preclude Rena C. from
recovering attorneys’ fees for subsequent time spent on terms
originally included in the offer.
As already noted, a prevailing party may be statutorily barred from recovering
attorneys’ fees “for services performed subsequent to the time of a written offer of
settlement to a parent if[,]” among other things, she objects to that offer and “the relief
finally obtained … is not more favorable … than the offer[.]” 20 U.S.C.
§ 1415(i)(3)(D)(i). That bar “applies … unless she was substantially justified in rejecting
[that] offer.” Rena C., 890 F.3d at 417 (emphasis added) (citations omitted). Under
those rules, we previously determined that Rena C. was eligible to recover post-offer
attorneys’ fees because she was substantially justified in rejecting Colonial’s offer. Id.
The District Court on remand stated, however, that “[t]he Third Circuit, finding that ‘the
relief ultimately obtained by Rena C. was not more favorable than the settlement offer[,]’
concluded that the 20 U.S.C. § 1415(i)(3)(D)(i) bar applied.” (App. at 23.) That
misapprehends our earlier ruling. The statutory bar, § 1415(i)(3)(D)(i), did not and does
not preclude Rena C. from recovering post-offer attorneys’ fees.
It appears that the District Court interpreted the statutory bar provision as one that
applies on an issue-by-issue basis. In light of our prior decision that Rena C. had not
obtained more favorable terms than Colonial’s original offer, the District Court applied
that statutory bar to attorneys’ fees deriving from time spent related to terms that were
previously included in Colonial’s offer. But the gravamen of our ruling was that Rena C.
was entitled to post-offer fees.
13
Applying the statutory bar as the District Court did undermined that earlier
decision. In IDEA’s statutory scheme, the bar on recovery of fees either applies or it
does not. The equivalence of Colonial’s offer and the substantive relief Rena C. obtained
is only a consideration for eligibility; § 1415(i)(3)(F) does not mandate a reduction in
attorneys’ fees for time spent on terms that were previously included in a school’s
rejected offer. Attorneys’ fees need not necessarily be reduced post-offer, even if a
prevailing-party parent does not obtain terms “more favorable” than a school’s offer. See
generally 20 U.S.C. § 1415(i)(3)(F) (listing the factors that mandate a reduction in the
amount of attorneys’ fees and which does not include a reduction when the relief
obtained is not more favorable than the offer of settlement).
Once its offer was rejected, Colonial was under no obligation, statutory or
otherwise, to offer those terms again – a fact the District Court recognized. (App. at 107
(“There is no requirement that a school district make a better offer or reinstate the ten-day
offer after it expired or was rejected. A school district is free to offer more or less than
what it had originally offered.”).) Rena C. and her attorneys, therefore, could not have
reasonably prepared for the administrative proceedings without accruing post-offer
attorneys’ fees associated with one-on-one instruction, pendency, or any other terms
essential to Rena C. As we previously held that Rena C. was substantially justified in
rejecting Colonial’s offer, we likewise now conclude that the statutory bar does not
preclude Rena C.’s eligibility to recover post-offer attorneys’ fees related to terms that
14
were previously included in that rejected offer.11 When the District Court recalculates
attorneys’ fees, that eligibility should be borne in mind, though it does not dictate the
result.
B. On remand, the District Court maintains discretion to calculate Rena
C.’s award of attorneys’ fees.
Our holding is limited to eligibility. That is, we conclude that Rena C. is eligible
to recover reasonable attorneys’ fees without the exceptions imposed by the District
Court, and we do not disturb the Court’s decision to exclude certain excessive or
duplicative time entries. See App. at 14-20. But see supra n.5. On remand, we leave in
the Court’s hands the determination of the amount of fees. 12 The District Court continues
to have discretion, and we will generally affirm the exercise of that discretion so long as
it is “exercised in light of the considerations we have identified” and is accompanied by
“a concise but clear explanation of [the] reasons for the fee award.” Hensley, 461 U.S. at
437.
11
For the same reasons, we also conclude that the fact that time was spent
litigating terms originally included in Colonial’s offer does not, in and of itself, suffice to
say that Rena C. or her attorneys “unreasonably protracted the final resolution of the
controversy.” 20 U.S.C. § 1415(i)(3)(F)(i). Vacatur is also in order to the extent the
District Court reduced Rena C.’s attorneys’ fees on that basis. (App. at 22 (“Rena
unnecessarily protracted the due process proceeding and her attorneys spent a significant
amount of time continuing to litigate pendency after Colonial had offered it.”).)
12
We also leave in the Court’s hands the determination of lead counsel’s hourly
rate. See supra n.2; see also Bell, 884 F.3d at 725 (recognizing that “it would be fairly
easy for the district court to recheck its work in response to allegations of errors in
calculation and either to adjust the fee award accordingly or to explain why the
calculation was not erroneous”).
15
III. CONCLUSION
For the foregoing reasons, we will vacate the order awarding attorneys’ fees and
remand for recalculation consistent with this opinion.
16