Laffey Matrix

The Laffey Matrix is a fee schedule used by many United States courts for determining the proper hourly rates for professional legal work.

Overview

More than one methodology may used in calculating the applicable Laffey rate, yielding somewhat different results. Courts in the United States look to the Laffey Matrix when they award attorneys' fees under a fee-shifting statute, such as the Civil Rights Attorney's Fees Awards Act.

Attorney fee reasonable hourly rates

Guidelines for reasonable hourly rates for attorneys were set by a federal court in "Laffey v. Northwest Airlines, Inc.", 572 F.Supp. 354, 371 (D.D.C. 1983), who ruled that hourly rates for attorneys practicing civil law in the Washington, DC metropolitan area could be categorized by years in practice and adjusted yearly for inflation.

While the Office of the United States Attorney in the Department of Justice (DOJ) has crafted its own rules for its version of the Laffey Matrix, this version uses an old Matrix from the Court as its basis, utilizes the CPI for "all goods and services" in the DC area (including the cost of bananas and refrigerator repair) and uses rounding to the nearest $5.

The same Court which created the Laffey Matrix has now rejected the DOJ’s methodology of setting and adjusting hourly rates for the Matrix. The District Court for the District of Columbia has instead ruled, based upon the testimony of an expert economist, that it is more appropriate to utilize an adjusted Adjusted Laffey Matrix. See [http://www.laffeymatrix.com] McDowell v. District of Columbia, Civ. A. No. 00-594 (RCL), LEXSEE 2001 U.S. Dist. LEXIS 8114 (D.D.C. June 4, 2001)

The Third Circuit Court of Federal Appeals has adopted the Adjusted Laffey Matrix. "Interfaith Community Organization v. Honeywell International, Inc.," 426 F.3d 694 (3rd Cir. 2005). ("In updating the matrix to account for inflation from 1989-2003, ICO relied on the legal services component of the nationwide Consumer Price Index (“the Legal Services Index”), a measure of inflation in the cost of legal services maintained by the Bureau of Labor Statistics."). The Court of Appeals noted that the District Court "reviewed both indices [the DOJ Matrix and the Adjusted Laffey Matrix] and decided that [the Adjusted Laffey Matrix] represented a better measure of prevailing rates in Washington, DC. In so doing, it relied on a decision by the District Court for the District of Columbia, Salazar v. District of Columbia, 123 F.Supp.2d 8 (D.D.C.2000), which compared the U.S. Attorney's Laffey Matrix with a matrix similar to that put forward by ICO in this case and concluded that the latter method was superior. Salazar is one of the few decisions approving the use of this approach, and it is, according to ICO, the only decision (prior to the District Court decision in this case) comparing the two approaches."

The Fourth Circuit has implicitly supported the use of the legal services component of the CPI, rather than the general CPI itself, for determining attorney's fees under 28 U.S.C. § 2412(b). See "Sullivan v. Sullivan", 958 F.2d 574, 577 & n.8 (4th Cir. 1992). The US District Court for the District of North Carolina has adopted the Adjusted Laffey Matrix as well. "North Carolina Alliance for Transportation Reform, Inc. v. United States Department of Transportation", 168 F. Supp. 2d 569 (D.NC 2001) ("Plaintiffs adjust the matrix's billing rates by applying the annual inflationary factor for legal services as reported in the United States Department of Labor's Consumer Price Index ("CPI")").

Some California Federal courts have accepted the same methodology, adjusting the Laffey Matrix upwards based upon the higher costs of living in Los Angeles and other California cities. "In Re HPL Technologies, Inc. Securities Litigation", 366 F.Supp.2d 912, 921 (N. Dist. Cal. 2005). See also “It is the practice of the undersigned judge, however, to rely on official data to determine appropriate hourly rates, not on an attorney's self-proclaimed rates or declarations regarding hourly rates charged by law firms. One reliable official source for rates that vary by experience levels is the Laffey matrix used in the District of Columbia.” Garnes v. Barnhardt, 2006 U.S. Dist. LEXIS 5938 (N. Dist. Cal. 2006).

Calculation

"The initial estimate of a reasonable attorney's fee "--the so-called lodestar fee--" [sic] is properly calculated by multiplying the number of hours reasonably expended on the litigation times a reasonable hourly rate." Sexcius v. District of Columbia, 839 F. Supp. 919, 921 (D.D.C. 1993) [*4] (quoting Blum v. Stenson, 465 U.S. 886, 888, 79 L. Ed. 2d 891, 104 S. Ct. 1541 (1984)) aff'd Covington v. District of Columbia, 313 U.S. App. D.C. 16, 57 F.3d 1101 (D.C. Cir. 1995) (Covington II ). Hensley v. Eckerhart, 461 U.S. 424 (1983).

Normally, a prevailing party must establish a reasonable hourly rate, usually with affidavits and other evidence of the market rate. Kling v. Department of Justice, MSPB Dkt. No. AT075299048 (July 22, 1980)). “Affidavits are a particularly appropriate means of establishing the reasonableness of the amount of fees claimed. Kling, supra. A reasonable hourly rate may also be established by affidavits from other attorneys in the community with similar experience stating the rates that they charge fee-paying clients in similar cases. See Montreuil v. Department of the Air Force, 55 M.S.P.R. 685, 690-91 (1992) (citing Swanson v. Defense Logistics Agency, 35 M.S.P.R. 115, 119 (1987)).

In addition to affidavits and prior fee settlements, the Laffey Matrix is very useful as a guide to Market Rate attorney fees for the Baltimore / Washington area. The Laffey Matrix has been cited as good evidence of the Market Rate for attorneys practicing in federal employment arbitration matters. See Department of Health and Human Services, Social Security Administration and AFGE, 93 FLRR 1-4011 (1993); Department of the Treasury, Internal Revenue Service, Washington, DC and NTEU, 93 FLRR 1-1283, 48 FLRA No. 100, 48 FLRA 931 (1993); Hatfield v. Garrett, 90 FEOR 1046 (EEOC 1989).Laffey v. Northwest Airlines, Inc., 572 F.Supp. 354, 371 (D.D.C. 1983); Save Our Cumberland Mountains v. Hodel, 857 F.2d 1516, 1525 (D.C. Cir. 1988) (en banc).

Regarding the “updated version of the Laffey matrix,” the Court in McDowell v. District of Columbia, Civ. A. No. 00-594 (RCL), LEXSEE 2001 U.S. Dist. LEXIS 8114 (D.D.C. June 4, 2001) stated in part:

"Plaintiffs may point to such [*9] evidence as an updated version of the Laffey matrix or the U.S. Attorney's Office matrix, or their own survey" to demonstrate the prevailing market rates in the community. n5 Covington II, 57 F.3d at 1109. Moreover, the plaintiffs may supplement any matrix that has been offered with "evidence of recent fees awarded by the court." Id. "Finally, the defendants may challenge plaintiff attorneys' market data, in an effort to show that the submitted market rates are inaccurate." Id. at 1110; see also Covington v. District of Columbia, 839 F. Supp. 894, 898 (D.D.C. 1993) (Covington I) (permitting defendants a chance to persuade court on what prevailing market rates are) aff'd Covington II, 313 U.S. App. D.C. 16, 57 F.3d 1101; Cf. Oil and Chemical Workers, 2001 WL 427287, at *7 (allowing the defendant to propose alternate methods of compensation for attorneys who did not meet the other factors for receiving compensation).

n5 The matrix may be found in Laffey v. Northwest Airlines, Inc., 572 F. Supp. 354 (D.D.C. 1983)

Here, while the plaintiffs do not give an updated Laffey matrix, they do cite the matrix. n6 (Plaintiffs' Motion for fees at 3). Moreover, plaintiffs also supplement their motion by presenting cases that show an increase in the Laffey scale. For example, the plaintiffs attached Dorsett to show an increase of fees to $ 280 per hour. (Plaintiffs' Unpublished Cases); Dorsett v. District of Columbia, No. 00- 212, slip op. (D.D.C. Sep. 12, 2000). The plaintiffs also included Wingfield to justify a fee award of $ 335 per hour. n7 (Plaintiffs' Notice of Supp. Case); Wingfield v. District of Columbia, No. 00-121, slip op. at 6 (D.D.C. Apr. 13, 2001). Finally, recent cases such as Salazar have justified an award of $ 444 per hour and $ 369 per hour based on an updated version of the Laffey matrix. Salazar v. District of Columbia, 123 F. Supp. 2d 8, 13 (D.D.C. 2000).”

The Court in Salazar approved an updated version of the Laffey matrix, which is provided as Exhibit 1 hereto. The Laffey matrix is computed by multiplying a base hourly rate by an Adjustment Factor. The updated Laffey matrix uses more accurate, recent base hourly rates and a more accurate Adjustment Factor. The updated Laffey matrix has been cited with approval. See, e.g., McDowell v. District of Columbia, Civ. A. No. 00-594 (RCL), LEXSEE 2001 U.S. Dist. LEXIS 8114 (D.D.C. June 4, 2001) citing Salazar v. District of Columbia, 123 F. Supp. 2d 8, 13 (D.D.C. 2000).

Adjusted Laffey Matrix

The Adjusted Laffey Matrix (utilizing the LSC CPI) is an appropriate and best measure for hourly rates for federal administrative proceedings. Usually, if no normative billing rate is available for attorneys, a reasonable hourly rate can be established by affidavits, past awards or evidence of reasonable rates in the community such as the Adjusted Laffey Matrix.

In Laffey v. Northwest Airlines, 241 U.S. App. D.C. 11, 746 F.2d 4 (D.C. Cir. 1984), the D.C. Circuit devised a matrix that established a standard hourly rate for attorneys in “the Baltimore-Washington area.” See Elouise Pepion Cobell, V. Gale A. Norton, Secretary of the Interior, Civil Action Number 96-1285 (RCL), 2002 U.S. Dist. LEXIS 21726 (D.C.Cir. November 12, 2002). The D.C. Circuit has since declared that updated versions of the matrix, which adjust the rates annually for inflation, may be relied on as evidence of the prevailing market rate for attorneys in the community. Covington, 57 F.3d at 1109.

upported by experts

Michael Kavanaugh is an economist from Batavia, Ohio. Dr. Kavanaugh holds a Ph.D. in economics from the University of Cincinnati (1975) and a B.A. in economics form Xavier University (1970). He has taught economics at the University of Cincinnati and at Northern Kentucky University. He has worked as a natural resource and environmental economist for a variety of clients, including the U.S. Department of Justice, the U.S. Environmental Protection Agency, environmental groups and private industry for over 20 years. He has been qualified as an expert in Federal court on financial and economic matter on a number of occasions. He is the economist credited by the D.C. Circuit in the Salazar case. His explanation of the advantages of the Adjusted Laffey Matrix is as follows:

The Laffey matrix was updated to 1988-1989 rates in connection with the Save Our Cumberland Mountains v. Hodel, 857 F.2d 1516 (D.C. Cir. 1988) (en banc) litigation. The Consumer Price Index for U.S. City Average, Legal Service Fees (“Legal Services Index”) maintained by the U.S. Department of Labor, Bureau of Labor Statistics is a better measure of the change in prices for legal services in Washington, D.C., than the Consumer Price Index for Washington, D.C., Maryland, Virginia, All Items (“DC Merto CPI”). He has reviewed both the update to the Laffey matrix which uses the Legal Services Index to bring 1988-1989 rates forward to present, and the update referred to as the United States Attorneys’ Office Laffey matrix, which utilizes the DC Metro CPI to bring 1981-1982 rated forward to present.

Both the Legal Services Index and the DC Metro CPI are readily available and are maintained by the U.S. Department of Labor, Bureau of Labor Statistics. The underlying data are collected by the U.S. Department of Commerce, Census Bureau as part of its quinquennial census and its annual surveys. Economists use as specific an index as possible to determine changes in prices in a part of an industry, such as here changes of prices in legal services in the Baltimore- Washington area. To measure changes in an industry’s prices, it is far preferable to use a specific index rather than a broad index.

The Legal Services Index is a national index that includes the metropolitan Baltimore- Washington, D.C., area. Adjusting the Laffey matrix with a national index assumes that the rate of change of prices for legal services is about the same everywhere. This is not the same thing as prices being the same everywhere. Even if prices differ in different places, the rate of change in prices is likely to be about the same. With resource mobility and the ability to communicate easily over distances, this is a plausible assumption. While it is possible for prices for the same good or service to change at different rates in different places, this is most likely to happen for goods or services for which there is only a local market because their transport is expensive relative to their value (e.g., fast food) or because communication is difficult.

The market for legal services in federal litigation in the Baltimore- Washington, D.C. area is not a local market. Therefore, it would be more appropriate to use the Legal Services Index, which captures supply and demand factors particular to the legal services market as well as inflation, as compared to the Baltimore-Washington Metro CPI, which chiefly captures inflation effects.

The Laffey matrix prepared by Dr. Kavanaugh is preferable to the United States Attorneys’ Office Laffey matrix for an additional reason. The Adjusted Laffey matrix updated is based on observations from 1988-1989, whereas the United States Attorneys’ Office Laffey matrix uses 1981-1982 rates as a base. In general, the more contemporary the observations, the less possibility exists for forecasting errors. Thus, the Adjusted Laffey matrix is more likely to be an accurate forecast of rates because it applies an index to more recent observations to bring rates forward to the present as contrasted to the United States Attorneys’ Office Laffey matrix which uses an index to bring forward much earlier observations.

Another method is to adjust for local costs of wages to lawyers and paralegals. The Laffey Matrix can be adjusted for local costs using the Bureau of Labor Statistics data on wages paid to lawyers (occupation code 23-1011) and paralegals (occupation code 23-2011) for primary metropolitan statistical areas in each state (http://www.bls.gov).

Here is what the hourly rate Matrix looks like for June 1, 2006 to May 31, 2007 for D.C., 5 cities in California, Hartford, CT and New York City after adjustments are made for local labor costs.

This will need to be adjusted when the May CPI figures are available and the Laffey Matrix is updated by the LaffeyMatrix.com administrators, based upon DOL BLS new wage data available, usually in early July of each year.

References

* Harvard reference
Surname=US Attorney's Office, District of Columbia
First=
Year=2005
URL=http://www.usdoj.gov/usao/dc/Divisions/Civil_Division/Laffey_Matrix_4.html
Title=Laffey Matrix 2003-5
Access-date=August 17, 2006
* Harvard reference
URL=http://www.laffeymatrix.com
Title=Adjusted Laffey Matrix
First=
Surname=Laffey Matrix Website
Year=2004
Access-date=August 17, 2006

ee also

*Attorney's fee