Creative Deal Fails to Win Lawyer Fees at 9th Circuit

[CASE] Law.com reports Creative Deal Fails to Win Lawyer Fees at 9th Circuit.

The 9th U.S. Circuit Court of Appeals on Wednesday dealt a blow to plaintiffs lawyers seeking court-ordered fees in small-money cases.

Lump-sum settlements that preclude lawyers from seeking separate attorneys fees have long been a bane of the plaintiff bar, and of lawyer Michael Mitchell in particular.

The plaintiff in the case was a girl who was unconstitutionally required to submit to a gynecological examination while in a juvenile detention facility. Mitchell did not expect the case to have a high monetary value and sought to protect his fee by having the client assign to him her right to seek attorneys fees and to waive her right to enter into a lump sum settlement. The agreement also said the Mitchell and his partner would recive the greater of 1/3 of the gross award (40% under certain conditions) or statutory attorney's fees.

She did settle, for a "lump sum, including all attorney's fees." The sum was $29,999. Mitchell then went to court to seek the statutory fees -- asking for over $50,000.

The 9th Circuit rejected his arguments:

We hold that the provisions of the retainer agreement conveying Pony’s right to seek or waive attorney’s fees to Mitchell are void under California law. We reach this conclusion because Section 1983 sounds in tort and California law prohibits a plaintiff from transferring her substantive tort claims. We also find that Mitchell lacks standing to raise a constitutional challenge to the County’s settlement policy.

Pony v. County of Los Angeles, No. 03-5685 (9th Cir. Jan. 11, 2006

Categories: settlements, lump-sum, attorney's-fees, cases