H.D.V. , 660 F. App'x 375 ( 2016 )

NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
File Name: 16a0496n.06
No. 15-1449
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT FILED
Aug 23, 2016
DEBORAH S. HUNT, Clerk
H.D.V. - GREEKTOWN, LLC; 415 EAST )
CONGRESS, LLC; and K AND P, )
INCORPORATED, d/b/a Deja Vu, d/b/a Zoo ) ON APPEAL FROM THE
Bar, ) UNITED STATES DISTRICT
) COURT FOR THE EASTERN
Plaintiffs – Appellants, ) DISTRICT OF MICHIGAN
)
v. )
OPINION
)
CITY OF DETROIT, MICHIGAN, )
)
Defendant – Appellee, )
)
and )
)
MAJED DABISH, )
)
Defendant. )
)
Before: MOORE, GIBBONS, and DAVIS,* Circuit Judges.
ANDRE M. DAVIS, Senior Circuit Judge. This appeal arises from a First Amendment
action that concerned efforts by Appellee, the City of Detroit, Michigan (the “City”), to thwart
the sale and continuing operation of an adult entertainment nightclub in downtown Detroit.
After years of litigation, culminating in a previous appeal to this Court that effectively resolved
the merits issues, the district court entered a consent decree awarding $2.95 million in damages
*
The Honorable Andre M. Davis, Senior Circuit Judge for the United States Court of Appeals for the
Fourth Circuit, sitting by designation.
No. 15-1449, H.D.V. - Greektown, LLC v. City of Detroit
to Appellants H.D.V. - Greektown, LLC (“H.D.V.”); 415 East Congress, LLC (“415 E.
Congress”); and K and P, Incorporated (“K & P”). Appellants then sought over $1.5 million in
attorneys’ fees and costs. After concluding that Appellants could not recover certain fees, the
district court reduced the remaining requested fees by 60%. It declined to grant a fee
enhancement and also imposed a 3% cap on the fees incurred by Appellants’ counsel while
litigating the attorneys’ fees motion, ultimately awarding in fees and costs $385,401.12.
Appellants now challenge each of those decisions on appeal. They also ask us to assign
this case to a different district judge on remand. We agree with Appellants that the district court
did not adequately explain why a 60% reduction was appropriate. Moreover, the award of fees
for fees must be recalculated given our decision in The Northeast Ohio Coalition for the
Homeless v. Husted, Nos. 14-4083, 14-4084, 14-4132, 14-4133, 15-3295, 15-3296, 15-3380, 15-
3381, --- F.3d ---, 2016 WL 4073489 (6th Cir. Aug. 1, 2016) (published). In all other respects,
we discern no error or abuse of discretion. Accordingly, we AFFIRM IN PART, REVERSE
IN PART, and REMAND for further proceedings. Appellants’ request for reassignment on
remand is DENIED.
I. BACKGROUND
We described the lengthy background of this litigation in the earlier merits appeal. See
H.D.V.-Greektown, LLC v. City of Detroit, 568 F.3d 609, 613–16 (6th Cir. 2009). The relevant
facts for the purposes of the attorneys’ fees motion are as follows.
A. The 2003 Action
K & P has operated a topless nightclub in downtown Detroit since 1986, in a building
now owned by 415 E. Congress. In December 2002, H.D.V. entered a conditional agreement to
purchase the nightclub and applied for a transfer of K & P’s liquor license and topless activity
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permit. Hoping to frustrate the purchase, the City refused to consider the transfer applications,
asserting that the nightclub’s continuing use of topless female dancers had violated a condition of
land use known as “Condition 18,” which limited K & P to providing male-only adult
entertainment. In 2003, Appellants filed suit in the Eastern District of Michigan, asserting that
Condition 18 violated their First Amendment rights (the “2003 Action”). The parties eventually
settled the dispute and stipulated that Condition 18 was unenforceable. The parties also
stipulated that the dismissal of the 2003 Action was “without an award of costs or attorneys[’]
fees to any party.” R. 84-5 2d Am. Compl. Ex. A ¶ 10 (Page ID #2513). Accordingly, in
December 2003, the district court entered an order declaring that the City could not enforce
Condition 18 and stating that “all claims in this action are dismissed without prejudice and
without costs or an award of attorneys[’] fees to any party.” R. 84-6 2d Am. Compl. Ex. B, at 3
(Page ID #2517).
Despite the district court order, three years passed without any action on the transfer
applications by the City. The City Council had instead passed resolutions ostensibly designed to
make it more difficult for K & P to sell or operate its nightclub, including resolutions that
prohibited the transfer of licenses or permits for businesses that operated with a nonconforming
use. The City then issued K & P two zoning violation notices, both alleging that K & P had
expanded the nonconforming use of its nightclub. K & P appealed the notices to the Board of
Zoning Appeals (“BZA”) where, despite the 2003 court order, the City continued to assert that it
could enforce Condition 18. The BZA dismissed the first violation notice and unanimously ruled
in favor of K & P as to the second violation notice.
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B. The 2006 Action
Appellants filed their second suitthe operative one herein the Eastern District of
Michigan in March 2006 (the “2006 Action”). At the time, the City still had not acted on
Appellants’ transfer applications. In a sprawling, 109-page complaint that asserted 16 counts
over 291 paragraphs, Appellants brought facial and as-applied constitutional challenges to the
City’s zoning and sign ordinances.
Appellants amended the complaint in April 2008, explaining that the “amend[ment] does
not seek to add new counts, or new causes of action[], but rather seeks only to add additional
Plaintiffs,” namely, four Jane Roe Plaintiffs “who have performed at [K & P’s] club.” R. 46
Pls.’ Mot. Leave to File 1st Am. Compl. ¶ 3 (Page ID #1447). The Jane Roe Plaintiffs were
added as representatives of a putative class of similarly situated employees. Appellants amended
the complaint a second time on May 11, 2009, “to add additional facts to support a count that
already exists in the current complaint”the as applied challenge to the City’s zoning
ordinances. R. 81 Pls.’ Mot. Leave to File 2d Am. Compl. ¶ 4 (Page ID #2230). Specifically,
Appellants amended the complaint to include allegations that then-City Council member Monica
Conyers had solicited a $25,000 bribe from Appellants in exchange for her vote in favor of the
transfer applications. The amendments added 29 pages and 16 paragraphs to the operative
complaint but no additional causes of action.
In January 2007, Appellants filed a motion for partial summary judgment1 challenging
the City’s zoning ordinances.2 See H.D.V.-Greektown, LLC v. City of Detroit, No. 06-11282,
1
Appellants filed a motion for partial summary judgment in December 2006 that impermissibly exceeded
the district court’s page limits. The district court struck the motion and directed Appellants to refile it in accordance
with the local rules. For this reason, Appellants include the hours spent preparing three partial summary judgment
motions, even though only two motions were decided on the merits.
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No. 15-1449, H.D.V. - Greektown, LLC v. City of Detroit
2007 WL 2261418, at *1 (E.D. Mich. Aug. 6, 2007). The motion was largely successful. The
district court concluded that the zoning ordinances, which gave the City broad discretion to
regulate adult businesses, impermissibly imposed prior restraints on protected speech. It also
found that the zoning ordinances violated the First Amendment because they “provide[d] no
limitations of time upon the reviewing authorities to render an official approval or disapproval.”
Id. at *5. Rather than enjoin the City from enforcing the provisions, however, the district court
directed the City to revise the zoning ordinances to comply with the First Amendment.
In April 2007, Appellants filed another motion for partial summary judgment, this one
challenging the City’s sign ordinances. See H.D.V.-Greektown, LLC v. City of Detroit, No. 06-
11282, 2008 WL 441487, at *1 (E.D. Mich. Feb. 14, 2008), aff’d in part and rev’d in part,
568 F.3d 609 (6th Cir. 2009). This portion of the lawsuit arose after K & P sought approval from
the City in 2004 to erect a sign advertising the nightclub’s new name. The City had not acted on
the request for at least three years. Appellants also partially succeeded on this motion. The
district court concluded that the sign ordinances, though facially constitutional, were
unconstitutional as applied to Appellants because the City’s “multi-year delay in acting upon the
Plaintiffs’ sign permit applications ha[d] violated their fundamental right to engage in free
speech under the First Amendment.” Id. at *9. The district court ordered the City to allow
Appellants to erect signs as described in their sign permit applications.
Appellants appealed the unfavorable portions of the district court’s order on the second
motion for partial summary judgment, and, in June 2009, this Court effectively resolved the
merits dispute in their favor. H.D.V.-Greektown, LLC, 568 F.3d at 612–13. The Court
2
The partial motions for summary judgment were substantial filings, each totaling 148 pages with exhibits.
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concluded that, given the district court’s determination that the zoning ordinances were
unconstitutional, K & P was entitled to use its property for any lawful purpose. This Court also
modified the district court’s order so that K & P could erect signs that reflected the nightclub’s
most recent name change.
The parties settled the case on March 29, 2011, and Appellants voluntarily dismissed the
Jane Roe Plaintiffs from the action on August 9, 2011. On August 23, 2011, the district court
entered a consent decree awarding Appellants $2,950,000 in damages. The consent decree
allowed Appellants to request attorneys’ fees under 42 U.S.C. § 1988 and acknowledged that the
parties had stipulated that Appellants were prevailing parties for the purpose of any award of
attorneys’ fees.
C. Motion for Attorneys’ Fees
On October 3, 2011, Appellants submitted a 334-page motion seeking attorneys’ fees
under § 1988. What followed was a somewhat protracted streak of filings: The City responded
with a 210-page filing, Appellants then filed a 140-page reply and a 13-page supplement, and
finally, the City filed a supplemental affidavit. In total, Appellants sought $1,532,640.61 in fees
and costs.
On May 23, 2013, a magistrate judge issued a report and recommendation concluding
that the motion should be granted in part and denied in part. Using the lodestar method for
calculating attorneys’ fees, the magistrate judge first determined that the hourly rates for
Appellants’ counsel were reasonable given each attorney’s skill and experience and noted that
counsel’s hourly rate fell between the 75th and 95th percentile of civil rights lawyers with
comparable skills.
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The magistrate judge concluded, however, that the total number of claimed hours
expended was not reasonable. In making that determination, the magistrate judge explained that
he did not believe that First Amendment cases were intrinsically more difficult than other types
of complex litigation, and he rejected Appellants’ contention that the case was undesirable
because it involved the adult entertainment industry. The magistrate judge also believed that
Appellants were not entitled to certain fees. Specifically, he concluded that the district court’s
order from the 2003 Action foreclosed the award of attorneys’ fees or costs from that action.
Nor were Appellants, according to the magistrate judge, entitled to the $16,200 requested for
work related to counsels’ involvement in Councilwoman Conyers’s criminal prosecution for
bribery. The magistrate judge explained that “[t]he criminal case was a separate proceeding that
involved separate parties.” R. 162 R. & R. 8 (Page ID #5121).
After excluding the requested fees for the hours spent on the 2003 Action and the
criminal proceedings, the magistrate judge turned to the reasonableness of the remaining
requested fees. He noted that the parties had turned the attorneys’ fees motion into another
round of major litigation and that, given reasonable resistance to “extravagances,” the district
court had a duty to trim the excessive hours. Id. at 10–11 (Page ID #5123–24). The magistrate
judge targeted three particular requests that, in his opinion, required some trimming. First,
regarding the BZA proceedings, the magistrate judge concluded that Appellants were entitled to
reimbursement for the time spent defending the district court’s order from the 2003 Action. He
added, however, that the issue surrounding Condition 18 “was a relatively minor part of the BZA
proceedings” such that “[t]o ask for all fees related to the BZA proceedings [was] clearly
excessive.” Id. at 12 (Page ID #5125).
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No. 15-1449, H.D.V. - Greektown, LLC v. City of Detroit
Second, the magistrate judge concluded that Appellants were not entitled to recover for
the hours expended representing the Jane Roe Plaintiffs because they were voluntarily dismissed
from the 2006 Action before the district court entered the 2011 consent decree, and thus the Jane
Roe Plaintiffs “received no relief, including no monetary relief.” Id. The magistrate judge noted
that, although Appellants did have standing to assert declaratory relief claims on behalf of the
Jane Roe Plaintiffs, doing so should have required little to no extra work. Third, the magistrate
judge explained that counsel’s “level of experience seems inconsistent with the astonishingly
large number of hours claimed for researching the law and preparing pleadings.” Id. at 13 (Page
ID #5126). Ultimately, despite recognizing that “the level of counsel’s representation in this
hard-fought case was excellent,” the magistrate judge recommended reducing the fees by 60%.
Id. at 13–14 (Page ID #5126–27).
Appellants had sought a 10% fee enhancement given (1) the City’s obstructive tactics;
(2) the case’s unpopular subject matter, which resulted in widespread media attention; and
(3) counsel’s low rates compared to other experienced First Amendment attorneys. The
magistrate judge recommended denying the fee enhancement because (1) the time spent
litigating the case was already factored into the lodestar calculation; (2) media attention was
inherently beneficial to a lawyer’s practice, and criminal matters were not compensable under
§ 1988; and (3) counsel’s hourly rates fell between the 75th and 95th percentile of civil rights
lawyers with comparable experience.
Next, the magistrate judge recommended a 60% reduction in costs commensurate with
the 60% reduction in fees. He concluded that expert witness fees were not recoverable under
§ 1988 for 42 U.S.C. § 1983 actions and, finally, determined that the City was not entitled to a
15% reduction of the fee award based on its troubling financial condition.
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No. 15-1449, H.D.V. - Greektown, LLC v. City of Detroit
The magistrate judge recommended awarding Appellants $372,118.19 in fees and
$13,282.93 in costs, totaling $385,401.12. Appellants timely objected to the report and
recommendation, asserting many of the same arguments they now raise on appeal. On March
31, 2015,3 the district court adopted the magistrate judge’s report and recommendation in full,
overruled Appellants’ objections, and granted in part and denied in part Appellants’ motion for
attorneys’ fees. Appellants timely appealed.
II. ANALYSIS
A. The 60% Reduction in Fees and Costs
Appellants argue that the district court abused its discretion because it did not explain
why a 60% reduction of the requested attorneys’ fees and costs was appropriate. The City
responds that a reduction was necessary because, even as otherwise shaved from the original
request, the requested fees were unreasonable. It adds that 60%, specifically, was the appropriate
reduction because counsel for Appellants expended excessive hours and exercised questionable
billing judgment. We review the award of attorneys’ fees under § 1988 for an abuse of
discretion. Binta B. ex rel. S.A. v. Gordon, 710 F.3d 608, 618 (6th Cir. 2013) (citing Reed v.
Rhodes, 179 F.3d 453, 469 n.2 (6th Cir. 1999)).
To resolve this dispute, we first examine the context within which Appellants may seek
fees. Section 1988 authorizes courts to award attorneys’ fees to prevailing parties in civil rights
actions. 42 U.S.C. § 1988(b). The aim of such fees is “to aid civil rights,” not attorneys, Binta
B. ex rel. S.A., 710 F.3d at 612 (citations omitted), and thus the primary concern is whether the
fee awarded under § 1988 is reasonable, Reed, 179 F.3d at 471; see also Farrar v. Hobby,
506 U.S. 103, 115 (1992) (“[F]ee awards under § 1988 were never intended to produce windfalls
3
The proceedings were delayed when the City filed for bankruptcy in 2013.
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to attorneys.” (quoting City of Riverside v. Rivera, 477 U.S. 561, 580 (1986) (plurality opinion))
(internal quotation marks omitted)).
A “reasonable” fee is one “sufficient to induce a capable attorney to undertake the
representation of a meritorious civil rights case.” Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542,
552 (2010). To determine whether a fee is reasonable, we apply the lodestar method, which
involves calculating “the number of hours reasonably expended on the litigation multiplied by a
reasonable hourly rate.” Hensley v. Eckerhart, 461 U.S. 424, 433 (1983). We discern a
reasonable hourly rate by “look[ing] to the prevailing market rates in the relevant community.”
Perdue, 559 U.S. at 551 (citation and internal quotation marks omitted). Courts should exclude
hours that were not “reasonably expended,” and “[c]ounsel for the prevailing party should make
a good faith effort to exclude from a fee request hours that are excessive, redundant, or otherwise
unnecessary.” Hensley, 461 U.S. at 434 (citation omitted).
On review, the district court’s decision is generally “entitled to substantial deference,
especially when the rationale for the award was predominantly fact-driven.” Binta B. ex rel.
S.A., 710 F.3d at 628 (quoting Adcock-Ladd v. Sec’y of Treasury, 227 F.3d 343, 349 (6th Cir.
2000)). Moreover, “the district court has discretion to adjust the award based on relevant
considerations peculiar to the subject litigation,” the most critical of which is “the degree of
success obtained.” Id. (citation and internal quotation marks omitted). This Court generally
“affirm[s] unless the [district] court’s ruling is based on an erroneous view of the law or on a
clearly erroneous assessment of the record.” Id. (quoting Isabel v. City of Memphis, 404 F.3d
404, 415 (6th Cir. 2005)).
To be sure, the discretion afforded to district courts is not absolute. Adcock-Ladd,
227 F.3d at 349. “[T]he district court must provide a clear and concise explanation of its reasons
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for the fee award.” Id. (quoting Hadix v. Johnson, 65 F.3d 532, 535 (6th Cir. 1995)) (internal
quotation marks omitted). While “[t]here is no precise rule or formula for making [fee]
determinations,” Hensley, 461 U.S. at 436, “[i]t is essential that the judge provide a reasonably
specific explanation for all aspects of a fee determination,” Perdue, 559 U.S. at 558. Without a
reasonably specific explanation, “adequate appellate review is not feasible, and without such
review, widely disparate awards may be made, and awards may be influenced (or at least, may
appear to be influenced) by a judge’s subjective opinion regarding particular attorneys or the
importance of the case.” Id.With these principles in mind, we agree with Appellants that the 60% reduction here
lacks a sufficient explanation by the district court. We have noted “the difficulty in assessing fee
applications with mathematical precision,” Binta B. ex rel. S.A., 710 F.3d at 639, but even so, a
district court must support a particular increase or reduction with some articulable calculation or
record evidence. The Supreme Court in Perdue, for instance, remanded in part because the
district court did not properly justify why it had increased the requested fees by 75% “rather than
[by] 50% or 25% or 10%.” 559 U.S. at 557. The district court in Perdue had reasoned, in part,
that the attorneys “had to make extraordinary outlays for expenses” and had waited an extended
period of time for reimbursement. Id. at 557–58. The Court rejected that justification as
inadequate, however, because the district court had not calculated what portion of the increase
was attributable to the delays; “[n]or did the court provide a calculation of the cost to counsel of
any extraordinary and unwarranted delay.” Id. at 558. The result, the Court explained, was that
the district court had increased the fees by an “essentially arbitrary” percentage. Id. at 557.
Similarly, in Binta B. ex rel. S.A., we vacated the district court’s 20% reduction because
the district court did not “demonstrate why [it had] settled on 20%, as opposed to 43.5% or 60%
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or 70%.” 710 F.3d at 640. The defendants in Binta B. ex rel. S.A. had sought a 43.5% reduction
of the fee award. Id. at 639. But the district court imposed a 20% reduction after “briefly and
summarily describ[ing]” the thirty-year history of the litigation and noting that the plaintiffs’
success was somewhat limited by their own efforts. Id. at 640. Given the complexity of the
case, we concluded that that “explanation was insufficient” and remanded with instructions to
“employ a methodology that permits meaningful appellate review.” Id. (citation and internal
quotation marks omitted).
Here, the explanation for imposing a 60% reduction similarly lacks the necessary
specificity. The district court first determined, in agreement with the magistrate judge, that the
hours spent on the 2003 Action and the criminal proceedings were not compensable. Excluding
the hours expended on the 2003 Action brought the requested award to roughly $1.05 million,
and Appellants had sought only $16,200 in fees for the criminal proceedings. At that point,
however, the district court commented that an additional 60% reduction was warranted because
counsel took an “indiscriminate approach” to the fee petition. R. 169 Order Adopting R. & R.,
Overruling Pls.’ Objs., & Granting in Part Pls.’ Mot. Att’y Fees & Costs (“Order Adopting R. &
R.”) 5 (Page ID #5218). The magistrate judge provided a more specific explanation. He noted
that Appellants sought fees for the criminal proceedings, the BZA proceedings (the bulk of
which were not reasonably expended on the 2006 Action), and representing the Jane Roe
Plaintiffs (whose inclusion in the proceedings required little additional work). The hours
expended on the criminal proceedings, however, were already excluded. Neither the district
court nor the magistrate judge determined what portion of the remaining fees were attributable to
the BZA proceedings and Jane Roe Plaintiffs. And at no point did either the district court or the
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magistrate judge assert that those hours were a majority or even a substantial amount of the
requested fees.
The district court also explained that Appellants are “extraordinarily profitable companies
whose access to the judicial and political processes is far greater than most citizens[’]” and that
this case has a “tangential relationship [to] compelling civil rights.” Id. at 4–5 (Page ID #5217–
18). These considerations are plainly inconsistent with § 1988(b). So long as Appellants have
prevailed in a qualifying civil rights action, they may be awarded attorneys’ fees for the hours
reasonably expended. Cf. Northcross v. Bd. of Educ. of Memphis City Sch., 611 F.2d 624, 636
(6th Cir. 1979) (explaining that, once the plaintiffs are determined to be the prevailing party,
“they are entitled to recover attorneys’ fees for all time reasonably spent on a matter.” (internal
quotation marks omitted)), abrogation on other grounds recognized by L & W Supply Corp. v.
Acuity, 475 F.3d 737, 739 & n.6 (6th Cir. 2007). This is so regardless of the prevailing party’s
own financial resources. See Lavin v. Husted, 764 F.3d 646, 650 (6th Cir. 2014) (“A plaintiff’s
ability to pay his or her attorney . . . is irrelevant to the fee inquiry.”). In addition, the magistrate
judge remarked that, in his view, the hours were excessive given that counsel was an experienced
First Amendment attorney. While we do not necessarily disagree, the magistrate judge did not
indicate how many hours would have been reasonable to expend given counsel’s experience and
the length of the litigation, and so we are unable to gauge the accuracy of his assessment.
A more specific explanation would have been helpful in light of the considerations that
suggest that a more substantial fee award would be appropriate here. Appellants succeeded in
having the City’s zoning ordinances declared facially unconstitutional. They prevailed in a case
fought over years of litigation and in the face of repeated attempts by the City to circumvent their
constitutional rights. The attempts were sometimes carried out legislatively through municipal
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ordinances and, at other times, were targeted directly at K & P’s nightclub through the City’s
refusal to consider Appellants’ sign permit and transfer applications. In other words, this case
involved thousands of hours of work spent defending fundamental constitutional rights and
enforcing prior court orders that had vindicated those rights, the very kinds of efforts that § 1988
aims to promote. See Binta B. ex rel. S.A., 710 F.3d at 612 (“[Section] 1988 plays a critical role
in ensuring that federal rights are adequately enforced, and attorneys have every right to be
compensated for any fees and expenses they reasonably incur.” (citation and internal quotation
marks omitted)).
The City argues that there was ample basis to conclude that the requested award was
excessive. That argument misses the point. Our concern is not whether the requested fee award
should be reduced but whether the reduction amount was appropriate and adequately explained.
The magistrate judge noted that the attorneys’ fees motion filings were voluminous, observed
that the number of claimed hours seemed extraordinary given counsel’s experience and level of
expertise, and explained that Appellants were not entitled to reimbursement for the hours
expended on ancillary proceedings or representing previously dismissed parties. Other than
noting that courts in other cases “have reduced the total fees or hours by amounts ranging from
40% to 77%” and saying that the district court “does not have an obligation to make [counsel]
millionaires,” however, the magistrate judge provided no rationale for why 60% was the
appropriate fee reduction. R. 162 R. & R. 13 (Page ID #5126). He gave similarly sparse
reasoning for reducing the requested costs by 60%. See id. at 17 (Page ID #5130) (“I have
recommended a reduction in the request for attorney[s’] fees by 60%, and a commensurate
reduction in the request for costs is appropriate.”). This reasoning is wholly inadequate. The
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district court, in adopting that recommendation, did nothing to explain why 60% was the
appropriate amount to account for those factors.
Accordingly, we conclude that the district court abused its discretion in reducing the
award for attorneys’ fees and costs by 60%, and we remand so that the district court can revisit,
in light of this opinion, whether a mere blanket percentage reduction in fees truly is appropriate,
and if so, by what measure, and ultimately to employ a methodology that permits meaningful
appellate review.
B. Jane Roe Plaintiffs
We now turn to Appellants’ other contentions. Appellants argue that they are entitled to
the full fees for representing the Jane Roe Plaintiffs. We disagree. The Jane Roe Plaintiffs were
voluntarily dismissed before the district court entered the consent decree, and they thus received
no monetary relief and were not considered prevailing parties to the action. Although neither
party disputes that Appellants have standing to assert facial constitutional challenges regarding
the City’s zoning ordinances on their employees’ behalf, see Clark v. City of Lakewood,
259 F.3d 996, 1011 (9th Cir. 2001), or that they have standing to assert declaratory relief claims
on behalf of their employees, adding the employees to the litigation as Jane Roe Plaintiffs should
not have been so onerous to warrant the award of the entirety of Appellants’ requested fees
attributable to that circumstance.
C. Ancillary Proceedings
1. The 2003 Action
Appellants argue that they are entitled to the fees from the 2003 Action because the
2006 Action was a continuation of that earlier litigation. Even if this is true, the parties
stipulated in the 2003 Action that there would be no award of attorneys’ fees. The district court
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memorialized that stipulation in its subsequent order: “By stipulation of the parties, all claims in
this action are dismissed without prejudice and without costs or an award of attorneys[’] fees to
any party.” R. 84-6 2d Am. Compl. Ex. B, at 3 (Page ID #2517). As the district court explained
during the fees proceedings below, “the placement of the phrase ‘without prejudice’ in that
sentence indicates that the substantive claims were dismissed without prejudice, but any claims
for costs or fees were dismissed with prejudice.” R. 169 Order Adopting R. & R. 7 (Page ID
#5220). Given their own stipulation, and the district court’s order, Appellants are not entitled to
fees related to the 2003 Action.
2. The Criminal Proceedings
Appellants argue that they are entitled to attorneys’ fees for the hours expended on
Councilwoman Conyers’s criminal prosecution because those allegations were the sole basis for
submitting the second amended complaint and because Appellants were required to participate in
the proceedings. The City, however, was neither a party to nor involved in the criminal
proceedings. To the extent that the bribes justified the filing of the second amended complaint,
the changes made were minimal, as Appellants added only factual allegations. Finally, as the
magistrate judge noted, the claimed hours related to the criminal proceedings included time spent
“[meeting] with reporters and review[ing] articles and television reports.” R. 162 R. & R. 8
(Page ID #5121). Fees incurred for such activity do not comport with § 1988’s purpose to
support civil rights litigation. We therefore conclude that Appellants are not entitled to fees
related to the criminal proceedings.
3. The BZA Proceedings
Appellants also argue that they are entitled to the full fees from the BZA proceedings.
The magistrate judge concluded that, to the extent that Appellants were entitled to fees for the
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City’s attempts to enforce Condition 18, those portions of the proceedings were “relatively
minor,” and the remaining time in the BZA proceedings was not reasonably expended on the
pending lawsuit. Id. at 12 (Page ID #5125). The district court agreed. We conclude that this
determination was not an abuse of discretion. The bulk of the proceedings were related to
zoning violations charging K & P with “increasing the number of dancers and the number of
days on which the entertainment was provided.” Id. Those allegations had nothing to do with
the constitutional challenges to the zoning and sign ordinances, which pertained to prior restraint
and the City’s refusal to resolve the permit applications in a timely manner. Although there is
some evidence that the City had attempted to enforce Condition 18 during the proceedings,
Appellants do not show that it was an issue substantial enough to justify an award of full feesa
burden that falls entirely on their shoulders. See Webb v. Bd. of Educ. of Dyer Cty., Tenn.,
471 U.S. 234, 242 (1985) (“[T]he party seeking an award of fees has the burden of submitting
‘evidence supporting the hours worked and rates claimed.’” (citation omitted)).
D. Fee Enhancement
Appellants requested a 10% fee enhancement, which was denied. We conclude that the
denial was not an abuse of discretion. Fee “enhancements may be awarded in ‘rare’ and
‘exceptional’ circumstances.” Perdue, 559 U.S. at 552 (citations omitted). Appellants bear the
burden of producing specific evidence that they are entitled to the fee enhancement. Id. at 553.
Here, Appellants present no viable arguments for why this is a rare or exceptional circumstance.
Nor do they present sufficient specific evidence demonstrating that they are entitled to a fee
enhancement. First, Appellants assert that their counsel bills below market rate, but those
concerns are already addressed through the lodestar method, which calculates fees based on the
prevailing market rate. Binta B. ex rel. S.A., 710 F.3d at 627 (citing Missouri v. Jenkins by
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No. 15-1449, H.D.V. - Greektown, LLC v. City of Detroit
Agyei, 491 U.S. 274, 285–86 (1989)). A fee enhancement may be appropriate when the
prevailing market rate fails to afford adequate compensation. See Perdue, 559 U.S. at 554–55
(“[A]n enhancement may be appropriate where the method used in determining the hourly rate
employed in the lodestar calculation does not adequately measure the attorney’s true market
value.”). Appellants have not shown that this is the case.
Second, Appellants argue that they obtained superior results. Although there are a few
circumstances in which superior results would justify a fee enhancement, the Supreme Court has
noted that those “circumstances are indeed ‘rare’ and ‘exceptional,’ and require specific evidence
that the lodestar fee would not have been ‘adequate to attract competent counsel.’” Id. at 554(citation omitted). Appellants have not made that showing here. Finally, Appellants’ argue that
the case was undesirable because it involved an adult entertainment business, but they offer no
evidence that counsel representing adult entertainment businesses are subject to any undue
pressure on their ability to obtain clients or adequate compensation for their work in representing
them. As it is Appellants’ burden to produce specific evidence, this argument fails because they
do not substantiate it. Cf. Barnes v. City of Cincinnati, 401 F.3d 729, 746 (6th Cir. 2005)
(affirming a fee enhancement based, in part, on two affidavits from attorneys attesting that the
case was highly controversial).
For all these reasons, we conclude that Appellants have not shown that the district court
abused its discretion in declining to award a fee enhancement.
E. Limit on Fees for Fees
The magistrate judge recommended limiting the fees recoverable for litigating the
attorneys’ fees motion to 3% of the overall award, and the district court agreed. Appellants now
challenge that decision, and they also challenge the continuing validity of the case that had
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No. 15-1449, H.D.V. - Greektown, LLC v. City of Detroit
imposed the 3% cap rule, Coulter v. Tennessee, 805 F.2d 146 (6th Cir. 1986), abrogated by The
Ne. Ohio Coal. for the Homeless v. Husted, Nos. 14-4083, 14-4084, 14-4132, 14-4133, 15-3295,
15-3296, 15-3380, 15-3381, --- F.3d ---, 2016 WL 4073489 (6th Cir. Aug. 1, 2016) (published).
At the time, Coulter had permitted the district court to apply a 3% cap on the award of fees for
fees absent a finding of unusual circumstances. See id. at 151. But we have recently abrogated
Coulter, given the Supreme Court’s decision in Commissioner, Immigration and Naturalization
Service v. Jean, 496 U.S. 154 (1990). See Husted, 2016 WL 4073489, at *28. Our precedent
now dictates, consistent with Jean, that the award of fees for fees be determined under the
Hensley reasonableness standard. See id. at *25. In light of Husted, we vacate the district
court’s fee for fee determination, and we remand for recalculation of that portion of the award.
F. Reassignment on Remand
Finally, Appellants argue that the case should be assigned to a different judge on remand
because the district judge below was “disrespectful to, and derisive and disparaging of, the
Plaintiffs, their constitutional rights, and . . . their counsel.” Appellants’ Br. 56. “Although [the
Court] ha[s] the authority pursuant to 28 U.S.C. § 2106 to remand the case to a different district
court judge, ‘this is an extraordinary power and should rarely be invoked.’” Brown v. Crowley,
312 F.3d 782, 791 (6th Cir. 2002) (quoting Armco, Inc. v. United Steelworkers of Am., 280 F.3d
669, 683 (6th Cir. 2002)). We can discern nothing in the record regarding the district court’s
consideration of the request for attorney’s fees or in the subsequent order that would warrant
reassignment. Accordingly, we decline to assign the case to a different district judge on remand.
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III. CONCLUSION
For the reasons set forth above, we AFFIRM IN PART, REVERSE IN PART, and
REMAND for recalculation of the attorneys’ fees and costs. Appellants’ request for
reassignment on remand is DENIED.
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