On December 4, the United States Court of Appeals for the Third Circuit denied plaintiff Joanne Scanno’s attempt to obtain a larger fee award under the Fair Debt Collection Practices Act. The Third Circuit affirmed the District Court’s ruling that a reduction in the fees sought was warranted because not only were the hours billed by Scanno’s counsel excessive, but also her counsel could have gotten the same result for her months earlier.
Scanno filed a lawsuit against F.H. Cann & Associates, Inc. in September 2016 on behalf of herself and on behalf of a putative class of others similarly situated.
In June 2017, F.H. Cann offered to settle the case for $2,500, inclusive of the maximum statutory award of $1,000, attorneys’ fees, and costs. Scanno’s counsel rejected this offer because it would leave only $1,000 toward attorneys’ fees.
Three months later, F.H. Cann offered to settle the case for $4,000, inclusive of the maximum statutory award of $1,000, attorneys’ fees, and costs. Once again, Scanno’s counsel rejected this offer because it would not cover his fees, which totaled $17,100.
Only days later, the parties reached a settlement on an individual basis in the amount of $1,000. As part of the settlement, the parties agreed that Scanno’s counsel would submit a motion for reasonable attorneys’ fees, which he did, seeking $27,333.
On appeal, the parties did not dispute Scanno’s counsel’s rate. Rather, Scanno challenged the district court’s conclusion that she had only limited success on the merits of her case. The district court had ruled that but for counsel’s decision to reject the earlier offer, Scanno could have obtained the same result months earlier. Thus, a downward adjustment of the loadstar was justified. The district court underlined its decision with a citation to Cohen v. Am. Credit Bureau, Inc., emphasizing that “the FDCPA was not passed in order to sprout a cottage industry for lawyers who self-interestedly battle over attorney’s fees in federal court.” The Third Circuit agreed.
The Third Circuit also affirmed the reduction to the amount billed for the fee petition on the basis that the time billed – 10.3 hours – was excessive, given counsel’s experience in the field.