Fee Award in Golf Course Case Goes Back for Another Round

by Ann W. Parks
The Daily Record, 9/9/04

A woman whose attorney's fee award in connection with a discrimination claim against a country club was increased from $3,000 to $22,440 after an appeal will get yet another chance to seek the full amount of $202,520 she claims is due.

The Court of Special Appeals vacated and remanded last year's judgment of the Montgomery County Circuit Court affirming an administrative panel's award of attorney's fees to Betty Flaa. The appellate court concluded that the Montgomery County Public Accommodation Panel - part of the county's Office of Human Rights - failed to properly apply the "lodestar" approach in determining counsel fees.

Under the lodestar method, attorney fees are calculated by multiplying the number of hours reasonably expended by counsel times the hourly rate.

In this case, the court noted, it was impossible to tell from the record how or even if the panel calculated the lodestar figure in arriving at its final amount.

"The Panel must first determine the lodestar amount and, if reductions are made, provide an explanation for the disallowed hours," Judge Mary Ellen Barbera wrote for the court - noting that the panel's $22,440 award constituted an 89 percent reduction of the hours reported by the appellant in the case.

Though Flaa had claimed 1,193.34 hours of work at a rate of approximately $170 per hour - and the hourly rate was undisputed - the panel had failed to explain why such a deviation was required.

Linda H. Thatcher, who represented Flaa, hailed the opinion as a significant one.

"This decision is so helpful to individuals who live in Montgomery County," she said, adding that residents will be able to file complaints with the county's Human Rights Office and find attorneys to represent them. "Lawyers will take meritorious cases and know that they will have to be paid under a lodestar analysis, not a cost-benefit analysis."

"All the opinion says is that they have to give more reasons as to why they awarded the fee that they did," he said. "I'm sure that the panel will give all the reasons it needs to give."

For the last three years, the case has been all about attorney's fees, he said.

Flaa filed claims with the county Office of Human rights in 1993, alleging gender discrimination by Rockville's Manor Country Club, where her husband was a member. She claimed that in spring 1993, she was ordered off the course by a golf pro who declared that women were not allowed.

The matter was referred to a hearing examiner, who concluded in 1999 that the country club was a place of public accommodation and had engaged in sex discrimination based on Flaa's incident. In May 2000, the public accommodation panel adopted these findings but refused to find that the country club had created a hostile environment, as the examiner had found.

The panel's award of $3,000 in attorney's fees - calculated by multiplying the $750 damage award by four - was reversed in 2001 by the circuit court, which held that the panel needed to consider the factors listed in §27-7(k)(1) of the Montgomery County Code in determining its fee award. Those factors included the time and labor required; the novelty and complexity of the case; and the skill necessary to perform the legal service properly.

The panel was also charged to consider Flaa's relative success, since she prevailed on two of her four claims, one of which - whether the club was a place of public accommodation - was a matter of first impression (a point still disputed by counsel in the case).

On its second attempt, the panel came up with $22,440. The circuit court affirmed.

The Court of Special Appeals faulted the panel's imprecise calculations, without reaching Flaa's argument that the panel improperly applied a cost-benefit analysis.

In calculating the initial lodestar figure, the court explained, reductions should be made where time is not reasonably expended or where the documentation of hours is inadequate. The lodestar should then be adjusted by considering the factors enumerated in the 1983 U.S. Supreme Court case of Hensley v. Eckerhart such as skill and time (in this case, the factors of §27-7(k)(1)).

A fee award may not be reduced "by a particular percentage or amount (albeit for justifiable reasons) in an arbitrary or indiscriminate fashion," Barbera wrote.

What the court held -- "Barbera: Do the math"

Case: Betty Flaa v. Manor Country Club, CSA No. 1102, Sept. Term 2003. Opinion by Barbera, J. Filed September 8, 2004.

Issue: Did an administrative panel properly calculate the amount of attorney's fees due to a plaintiff in a discrimination case against her country club?

Holding: No; circuit court judgment affirming the administrative decision vacated and remanded. The panel did not properly calculate the lodestar (the number of hours reasonably expended by counsel times the hourly rate) since it reduced the reported number of hours expended by counsel by 89 percent without explaining its rationale.

Counsel: Linda H. Thatcher for appellant;