Dall. Indep. Sch. Dist. v. Woody

DALLAS INDEPENDENT SCHOOL DISTRICT, Plaintiff, v. MICHELLE WOODY, as next friend of K.W., Defendant.

CIVIL ACTION NO. 3:15-CV-1961-G

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF TEXAS DALLAS DIVISION

November 30, 2018

MEMORANDUM OPINION AND ORDER

Before the court is the defendant Michelle Woody's amended motion for attorneys' fees (docket entry 87). The motion was referred to Magistrate Judge Renee Harris Toliver, who on September 17, 2018, issued an order granting the motion in part (docket entry 100). The plaintiff, Dallas Independent School District ("DISD"), filed timely objections to Magistrate Judge Toliver's order. This court has reviewed de novo those portions of Magistrate Judge Toliver's order to which objections were made, and has reviewed the remaining portions for plain error. For the reasons stated below, the defendant's Motion for Attorneys' Fees is GRANTED to the extent stated below.

I. BACKGROUND¹

Michelle Woody ("Woody") filed suit against DISD on behalf of her daughter ("K.W."), arguing that DISD violated the Individuals with Disabilities Education Act ("IDEA") by failing to offer K.W. a free appropriate public education ("FAPE") during her senior year of high school. In short, Woody sought reimbursement for the cost of K.W.'s private school tuition and, eventually, her attorneys' fees.²

Some background is necessary to put the fee request in context. In April 2012, educators in Los Angeles, where Woody and K.W. were then residing, evaluated K.W. due to her learning disabilities and educational history. As a result of the evaluation, the Los Angeles Unified School District ("LAUSD") referred K.W. to an individual education program ("IEP") team to determine her special education options. The IEP team concluded that K.W. was eligible for services under the IDEA. Shortly thereafter, during summer break, K.W. suffered a psychotic breakdown and was subsequently diagnosed with schizophrenia in addition to her learning disabilities. As a result, her doctors recommended a specialized learning environment with significant support and close monitoring, finding that K.W. was "far too fragile to be placed on a general education campus." Because LAUSD offered only general education services, Woody moved K.W. back to Dallas and enrolled her in the private Winston School. Eventually, Woody notified DISD that she wanted to receive FAPE benefits for K.W. in the form of tuition reimbursement for the 2013-2014 school year.

Throughout K.W.'s senior year, the parties engaged in various stages of the FAPE process, which culminated in a determination that K.W. was IDEA eligible (a reversal of DISD's earlier decision) and that the IEP that DISD proposed in May 2014 could be implemented at a DISD high school from April 2014 to April 2015. K.W. was to graduate in May 2014, however. Woody disagreed with the IEP and, following a due process hearing, a special education hearing officer ("SEHO") concluded that DISD "had a legal obligation to make a timely offer of FAPE available to [K.W.] for the 2013-14 school year." Finding that DISD failed to do so, the hearing officer concluded that Woody was entitled to reimbursement in the amount of $25,426.93, which was the cost of sending K.W. to the Winston School for the entire 2013-14 school year.

DISD then appealed to this court, Complaint at 1 (docket entry 1), and this court conducted a bench trial. In a 67-page decision, this court agreed that DISD had impeded K.W.'s right to a FAPE for the 2013-14 school year, but halved the reimbursement award to $11,942.50, finding that because Woody was partially responsible for the delay in requesting a FAPE for K.W., DISD was only liable for one half of K.W.'s Winston School tuition. See Dallas Independent School District v. Michelle Woody, 178 F. Supp. 3d 443, 475 (N.D. Tex. 2016) (Fish, Senior J.) (docket entry 55).

DISD again appealed, and the Court of Appeals for the Fifth Circuit upheld the determination that DISD had failed to timely offer K.W. a FAPE, but further reduced her award to allow reimbursement only from April 24, 2014, to the end of the school year, because that is when DISD should have offered the FAPE. On remand, this court awarded Woody $3,575.60 for the covered tuition and post-judgment interest. Memorandum Opinion and Order at 2-3 (docket entry 92). Woody then moved for attorneys' fees. Amended Motion for Attorney's Fees at 1-3 (docket entry 87). This court referred Woody's motion to Magistrate Judge Toliver for determination. Order Referring Amended Motion for Attorney's Fees (docket entry 98).

Upon receiving the referral, Magistrate Judge Toliver issued an order, rather than a findings of fact and recommendation, granting in part Woody's motion. Order at 1 (docket entry 100). In her order, Magistrate Judge Toliver reached conclusions on eight different issues. First, Magistrate Judge Toliver determined that the expert declaration of Craig Simon, a seasoned litigator hired by Woody to opine as to the reasonableness of her attorneys' fee rates, could be considered by the court when determining the reasonableness of Woody's fee rates. Id. at 5-6. Second, upon considering the evidence and her own expertise in assessing the reasonableness of attorney fee rates, Magistrate Judge Toliver determined that Woody's rates of $300.00 an hour rate for lead counsel (Atwood), $250.00 an hour rate for co-counsel (Gameros), and $125.00 an hour for paralegal work (Watson), were reasonable. Id. at 7-8. Third, Magistrate Judge Toliver concluded that Woody was a prevailing party who could seek her attorneys' fees under the IDEA, since the award Woody received on remand from the Fifth Circuit changed the legal relationship between the parties and fostered the purposes of the IDEA. Id. at 8-11. Fourth, Magistrate Judge Toliver determined that the number of hours billed by Woody's attorneys (605.60 for her lead counsel, 39.30 for co-counsel, and 43 hours for paralegal work) was reasonable. Id. at 12. Fifth, due to Woody's relative lack of success in obtaining the full amount of relief she originally sought, Magistrate Judge Toliver concluded that a 25 percent across-the-board reduction to Woody's fee award was justified. Id. at 12-13. Sixth, Magistrate Judge Toliver determined that an additional 5 percent across-the-board reduction to Woody's fee award was warranted because Woody's counsel exercised imperfect billing judgment. Id. at 14-16. Seventh, Magistrate Judge Toliver determined that the paralegal fees billed by Watson were fully compensable to Woody. Id. at 16-17. Eighth, Magistrate Judge Toliver determined that because evidence relating to DISD's previous settlement offer to Woody could not be found in the record, no fee reduction based on the proposed settlement was justified. Id. at 17-18.

After addressing these eight issues, Magistrate Judge Toliver concluded her order by granting Woody's motion for attorneys' fees in part. Id. at 19. Specifically, Magistrate Judge Toliver determined that Woody was entitled to recover from DISD in the amount of $142,432.50. Id. Although not expressly stated in her order, to calculate this award figure, Magistrate Judge Toliver applied Fifth Circuit precedent regarding the method for calculating attorneys' fees.

First, Magistrate Judge Toliver determined the lodestar amount by multiplying the total number of hours Woody's attorneys worked by their respective fee rates. See Rutherford v. Harris County, Texas, 197 F.3d 173, 192 (5th Cir. 1999) ("To decide an appropriate attorney's fee award, the district court [is] first required to calculate a lodestar fee by multiplying the number of hours reasonably expended on the litigation by a reasonable hourly rate."). Since Woody had two attorneys, however, Magistrate Judge Toliver had to add the products of two separate calculations. For Atwood, this meant the magistrate judge multiplied the 645.45 (605.60 + 39.90) hours worked by his rate of $300.00 an hour, for a product of $193,650.00. See Defendant's Brief in Support of Amended Motion for Attorneys' Fees at 5 (docket entry 88) (stating that Atwood worked 605.60 hours, billed at $300.00 an hour, before January 1, 2018); Defendant's Supplemental Appendix to Amended Motion for Attorneys' Fees at 13-15 (docket entry 97) (stating that Atwood worked 39.90 hours, billed at $300 an hour, after January 1, 2018). For Gameros, this meant the magistrate judge multiplied the 39.30 hours worked by her rate of $250.00 an hour, for a product of $9,825.00. See Defendant's Brief in Support of Amended Motion for Attorneys' Fees at 5 (stating that Gameros worked 39.3 hours, billed at $250 an hour). Adding these two products together produced the total lodestar amount of $203,475.00.

Second, Magistrate Judge Toliver adjusted the total lodestar based "on the circumstances of the case and after addressing the Johnson factors." Rutherford, 197 F.3d at 192. It is during this step that Magistrate Judge Toliver applied the two across-the-board fee reductions that she previously determined were warranted. Specifically, she reduced the loadstar amount of $203,475.00 by 30 (25 + 5) percent, resulting in a final fee award of $142,432.50. It is important to note, however, that even though Magistrate Judge Toliver concluded that Woody's paralegal fees of $5,075.60 were fully compensable, the magistrate judge excluded these fees from the total fee award to which she applied the 30 percent fee reduction.

DISD now objects to the findings and legal conclusions contained within Magistrate Judge Toliver's order. See Plaintiff's Objections to Magistrate Judge's Order Regarding Amended Motion for Attorneys' Fees and Brief in Support ("Response and Objections") (docket entry 101). In its briefing, DISD does not object to all eight of the magistrate judge's conclusions. Id. Rather, DISD objects only to Magistrate Judge Toliver's conclusions that: (1) the expert testimony of Craig Simon could be considered when determining the...