E. K. v. Edu-Hi ( 2023 )

NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS JUN 15 2023
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
E. R. K., by his legal guardian R.K.; et al., No. 22-16023
Plaintiffs-Appellees,
D.C. No.
v. 1:10-cv-00436-SOM-RT
STATE OF HAWAII DEPARTMENT OF
EDUCATION, MEMORANDUM *
Defendant-Appellant.
E. R. K., by his legal guardian R.K.; et al., No. 22-16126
Plaintiffs-Appellants,
D.C. No.
v. 1:10-cv-00436-SOM-RT
STATE OF HAWAII DEPARTMENT OF
EDUCATION,
Defendant-Appellee.
Appeal from the United States District Court
for the District of Hawaii
Rom Alex Trader, Magistrate Judge, Presiding
Submitted June 9, 2023**
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision
Honolulu, Hawaii
Before: BADE, BUMATAY, and SANCHEZ, Circuit Judges.
Defendant-Appellant, the State of Hawaii Department of Education
(“HIDOE”), appeals the award of attorneys’ fees under a class action settlement.
HIDOE argues that the district court erred when interpreting the settlement
agreement’s attorneys’ fees provision and abused its discretion when calculating the
lodestar to award $430,608.50 to Plaintiffs-Appellees (here, “Class Counsel”). On
cross-appeal, Class Counsel argues that the district court abused its discretion when
reducing certain hourly rates. We have jurisdiction under 28 U.S.C. § 1291, and we
affirm in part and remand in part.
This Court interprets the language of a settlement agreement de novo. Botefur
v. City of Eagle Point, 7 F.3d 152, 156 (9th Cir. 1993). The district court’s decision
to award attorney fees to class counsel, and the method of calculation, are reviewed
for abuse of discretion. In re Apple Inc. Device Performance Litig., 50 F.4th 769,
778 (9th Cir. 2022).
1. The district court did not err when interpreting the settlement
agreement’s attorneys’ fee provision. Under Hawai‘i law, absent an ambiguity, the
“terms of contract should be interpreted according to their plain, ordinary and
accepted use in common speech, unless the contract indicates a different meaning.”
without oral argument. See Fed. R. App. P. 34(a)(2).
2
Laeroc Waikiki Parkside, LLC v. K.S.K. (Oahu) Ltd. P’ship, 166 P.3d 961, 973
(Haw. 2007). The settlement agreement provides for Class Counsel to be paid
$1,500,000 in attorneys’ fees and costs. On top of that, the plain language of the
settlement agreement allows Class Counsel to seek “an additional $250,000.00” in
attorneys’ fees “upon application to and approval by the [District] Court.” Finally,
we agree with the district court that the settlement agreement also allows Class
Counsel to “seek additional attorneys’ fees and costs” beyond the $250,000
referenced above upon “a written request to the Court with notice to” HIDOE and
an opportunity for HIDOE to respond. In other words, $250,000 is not a “cap” on
additional attorneys’ fees, but an amount disbursable upon approval of the district
court. If Class Counsel seeks “additional” fees beyond that, it must comply with the
more stringent notice requirements.
2. The district court was within its discretion to apply an “across-the-
board” fee reduction before removing duplicative entries, Gonzalez v. City of
Maywood, 729 F.3d 1196, 1203 (9th Cir. 2013), and when setting Class Counsel’s
hourly rates according to the court’s own knowledge regarding prevailing market
rates. Ingram v. Oroudjian, 647 F.3d 925, 928 (9th Cir. 2011).
3. The district court, however, failed to state whether incremental fees
disbursed before the court’s April 2022 order were accounted for in the $430,608.50
award. HIDOE identifies $210,032.45 that was previously disbursed in incremental
3
payments. We cannot determine whether these disbursements were accounted for
in the final $430,608.50 award. On remand, the district court should make clear if
and how it factored in these incremental disbursements when awarding $430,608.50,
and, if necessary, reduce the overall award accordingly.
AFFIRMED in part, REMANDED in part for proceedings consistent with
this memorandum disposition.
4