Fees Not Related to Size of Damages Awarded

[David A. Szwak]

The attorney’s fee awarded is not related to the size of the damage award to the plaintiff. Creighton v. Emporia Credit Service, Inc., 1998 U.S. Dist. Lexis 6589 at 14-15 (E.D. Va. 1998) ("Courts generally will not look to the size of the damage award in determining reasonable attorney’s fees in consumer cases") (an FDCPA case citing Smith v. Chapman 436 F. Supp 58, 66 (W.D. Tex. 1977); Jordan v. Transnational Motors, Inc., 212 Mich. App. 94, 537 N.W.2d 471 (1995) (abuse of discretion to limit attorneys’ fees to 40% of amount obtained at trial); Loggins v. Delo, 999 F.2d 364, 368 (8th Cir. 1993) (the trial court "acknowledged that proportionality between the amount of damages and fee awards was not required") (citing City of Riverside v. Rivera, 477 U.S. 561 (1986)); Rice v. Mike Ferrell Ford, Inc., 403 S.E.2d 774 (W.Va. 1991) (overturning fee award limited to 1/3 of amount recovered and remanding for consideration of lodestar amount and other factors); General Motors Acceptance Corp. v. Jankowitz, 230 N.J. Super. 555, 553 A.2d 1380 (App. Div. 1989) (remanding on issue of attorneys’ fees because trial court limited attorney fees to verdict amount); Fleetwood Motor Homes of Pennsylvania, Inc. v. McGehee, 182 Ga. App. 151, 355 S.E.2d 73 (1987) (rejecting claim that under the Magnuson-Moss act, court should be limited to awarding a fee proportional to the amount of damages obtained).

The reasoning behind these cases is that "Monetary awards understate the real stakes. Judicial decisions have effects on strangers." Barrow v. Falck, 977 F.2d 1100, 1103-1104 (7th Cir. 1992). The Jordan court stated these important policy considerations this way:

In consumer protection as this, the monetary value of the case is typically low. If courts focus only on the dollar value and the result of the case when awarding attorney fees, the remedial purposes of the statutes in question will be thwarted. Simply put, if attorney fee awards in these cases do not provide a reasonable return, it will be economically impossible for attorneys to represent their clients. Thus, practically speaking, the door to the courtroom will be closed to all but those with either potentially substantial damages, or those with sufficient economic resources to afford the litigation expenses involved. Such a situation would indeed be ironic: it is but precisely those with ordinary consumer complaints and those who cannot afford their attorney fees for whom these remedial acts are intended


Jordan v. Transnational Motors, Inc., 537 N.W.2d 471, 474 (1995).

Separate from the issue of whether the plaintiff successfully reached the goals of the litigation, as was clearly done here, is that there are numerous cases under a variety of laws where the awarded attorney’s fees were many times higher than the damages. Loggins v. Delo, 999 F.3d 364, 368 (8th Cir. 1993) ($25,000 attorney’s fee award in civil rights suit for recovery of $102.50 in actual damages); Perez v. Perkiss, 742 F.Supp. 883 (D. Del. 1990) (an FDCPA case where court awarded over $10,000 in fees on a $1,200 jury verdict, including 11 hours defending the fee petition); United States Football League v National Football League, 887 F.2d 408, (2d Cir. 1989) (antitrust suit awarding $5,529,247.25 in attorney's fees and $62,220.92 in costs for a jury verdict of $3.00); Ratner v. Chemical Bank, 54 F.R.D. 412 (S.D.N.Y. 1972) ($20,000 fees for $100 damages in a Truth in Lending Act case).

Notably, under the FDCPA, which has the same fundamental policy goals as the Maryland Consumer Debt Collection Act, reasonable fees and costs are mandatory even if there has been no award of actual or statutory damages. Emanuel v. American Credit Exchange, 870 F.2d 805, 809 (2d Cir. 1989). In the instant case of course, damages were awarded by the jury.