Perdue v. Kenny A. Ex Rel. Winn

Background

Children in the Georgia foster-care system sued the Governor and state officials on behalf of about 3,000 foster children, claiming serious problems and seeking court-ordered reforms. The parties settled most issues in a consent decree, but the attorneys asked the court for more than $14 million in fees. Respondents calculated a lodestar of roughly $6 million and sought an additional enhancement of about $4.5 million, which the District Court awarded, producing about $10.5 million in fees; the Eleventh Circuit affirmed.

Reasoning

The Court addressed whether a lodestar fee—hours worked times prevailing hourly rates—can be increased for superior performance. It reaffirmed a strong presumption that the lodestar is sufficient and held that enhancements are available only in rare, exceptional circumstances. The Court explained three narrow bases for enhancement: when the rate calculation understates an attorney’s market value; when counsel bears extraordinary expenses in exceptionally long litigation; and when unjustified, exceptional delay in fee payment requires compensation. Fee applicants must identify non-duplicative factors and provide specific, objective proof and calculations.

Real world impact

The decision makes it harder for lawyers to obtain large performance bonuses above the lodestar unless they can show specific, exceptional reasons. It warns trial judges to explain any enhancement with concrete calculations so appellate review is possible. The case was reversed and remanded, so the fee award is not final and will be reconsidered under these standards.

Dissents or concurrances

Justices Kennedy and Thomas concurred with the Court’s restraint. Justice Breyer, joined by three Justices, would have upheld the enhancement, finding no abuse of discretion by the District Court.