Maybe Morad Elusta thought the world of his lawyers. When a client needs a lawyer’s help, and a lawyer is there to represent the client without need for any payment up front, love and appreciation are often in the air. After all, without the willingness of the lawyer to take on the client’s cause, there would be no means of redress. It’s all love, love, love.
But like a marriage, the love and gratitude wanes when money comes into the picture. And that’s what happened to Morad Elusta. From Courthouse News :
In a February 2006 complaint against Chicago and several officers, Morad Elusta claimed that police used excessive force while searching his home and falsely arrested him. The city offered to settle Elusta’s claims for $100,000, but Elusta refused the offer because he was unwilling to award his attorneys, David Cerda and John De Leon, a 40 percent share.
Eventually, Elusta hired new counsel – Zane Smith and Shelia Genson – who took the case to trial before a jury that awarded him $40,000.
The court later awarded Smith and Genson $83,000 in fees and ruled that Elusta owed his former lawyers, Cerda and De Leon, $15,000 for their services.
A legal fee well earned? An appreciative client? Well, maybe not.
Elusta then moved to have Chicago pay Cerda and De Leon, but give him 60 percent of the amount. He also said Smith and Genson should turn over 60 percent of their fee award to him.Nothing personal. It’s just money, and Elusta wants it. As much of it as he can get.
The crux of the argument was that since the contingent fee was a 60/40 split, Elusta figured he was entitled to 60% of everything, whether awarded as damages to him or fees to his lawyers. Notably, Elusta’s first attorneys got him an offer on the table for $100,000, to which he turned up his nose. After all, everybody knows that anyone whose constitutional rights are violated by the cops gets RICH!!! After trial, he received a jury verdict of $40,000 in damages. That must have hurt. There’s nothing like a good dose of fiscal reality to bring a winning verdict down.
The district court didn’t buy Elusta’s calculations, and the 7th Circuit affirmed.
“Elusta argues that the phrase ‘the attorney’s fees’ does not clearly cover all of the attorney’s fees,” Judge Diane Wood wrote for a three-member panel.
In a side note, Wood likened the argument to a quotation from Lewis Carroll’s “Through the Looking Glass,” where Humpty Dumpty says, “When I use a word it means just what I choose it to mean – neither more nor less.”
“The contract cannot bear Elusta’s interpretation,” Wood wrote. “What it does, in effect, is to say that counsel is entitled to receive 40 percent of any damages (the contingent fee); if fees are awarded to Elusta pursuant to §1988, the attorneys receive all of that award. The language that the attorneys ‘will divide the attorney’s fees recovered’ unambiguously covers all of the attorney’s fees recovered.”
So why should the lawyers, who didn’t suffer the pain and humiliation of the cops violating their rights by using excessive force in the search of his home and arrest, get more than the plaintiff, the aggrieved? This is where the gratitude of having lawyers there fighting for him turned to mush.
In the absence of a contingency fee, what were the chances that Morad Elusta had the wherewithal to bring the §1988 claim? Slim? None? Less than none? Despite what the internet tells people, lawyers don’t work for free. They don’t get offices for free, or food for free, or free cars and clothing. Lawyers have to pay for those things just like everyone else, and the way they do is by earning fees from the practice of law. I know, who’da thunk?
I suspect that Elusta realized this. His issue wasn’t that lawyers deserve to get paid, but that he wanted more money. His gratitude toward his lawyers for being there, taking on his cause without asking for a dime, waned, like the beauty of a true love. To many plaintiffs, the amount they are awarded is never sufficient to heal the wounds about which they obsess at night as they dream of how they will put those millions to use. Needless to say, defendants tend to obsess over the exaggerated claims.
Given that Elusta blew off the $100,000 offered in settlement, his jury award must have kicked him in the teeth. Not good enough. Who better to blame than the lawyers. After all, it’s always the lawyers fault.
Almost every criminal defense lawyer has enjoyed the experience of a client coming to an initial meeting screaming about how he’s going to sue the cops for his false arrest and violating his constitutional rights. Almost invariably, this is followed up by a promise to share the millions he’s going make from this “easy case” with the lawyer, rather than pay him up front. And they are sad when told that a criminal defense lawyer can’t take a contingent fee.
Clients are shocked, SHOCKED!, when they learn that nobody wants to take their “easy case.” Clients are even more shocked when, after some lawyer takes on their cause, that they won’t be millionaires. At least not because of this. And if that’s not bad enough, they feel violated again when they find out that their lawyers get paid for the work they do.
Not every client is as ungrateful and unappreciative as Elusta for the fact that a lawyer represented him in a case that wasn’t worth nearly as much as his thought. Not every client begrudges the lawyer a fee earned after the fact, a risk taken when the lawyer took him in and fought for his damages, which could (and often does) produce nothing but a 1000 hour hole in the lawyer’s practice. Not every one.
But lawyers work for a living, just like everyone else. And like everyone else, they’re entitled to be paid for their efforts. The fact that a client like Elusta wants his piece of the legal fee doesn’t change the dynamic. But for the lawyer who expects his client to be happy to see him compensated for his efforts, for taking in a person who would have no chance at redress without the lawyer’s willingness to put his own practice on the line, remember Morad Elusta.
It’s not that they don’t love their lawyer. It’s that they love money more. And what they would really love is if the lawyer gave away his services for free. Don’t forget it.
H/T FritzMuffKnuckle
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Scott — one of the first people who approached me when I opened my practice was a person who felt s/he was wrongly convicted by a corrupt judge and prosecutor, and that as a result, s/he had a slam-dunk case worth millions against the Judge, Prosecutor, State, and the city. This person was a paralegal as well, and offered their services to me.
S/he also asked me to represent her/him in a criminal matter on a contingency fee.
When I explained that I couldn’t, s/he was shocked why I wouldn’t do it anyway, especially since her/his civil case was worth millions.
I let that slide, and chalked it up to just one person whose perspectives were a bit skewed. I have since learned (and you have supported this belief) that I was wrong, and there are many more people like this out there.
My advice to younger/newer attorneys — run away from clients like this.
Cool story, Leo. So did you actively seek out hermaphroditic clients, or did they naturally gravitate to you?
I expected this response, yet failed to tailor my comment accordingly. Shame on me.
I expected better of you.
Buyer’s remorse is common in contingency fee arrangements.
I fail to understand the policy rationale behind allowing the plaintiff’s trial counsel to recover all of the fees awarded to the plaintiff, which is more than what the client was awarded in damages by the jury in these circumstances. Admittedly, the plaintiff would have received nil, or next to nil, if he prosecuted this litigation, pro se.
However, the attorney’s fees awarded pursuant to §1988, are awarded to the plaintiff, not the attorneys. The contract-model works for sophisticated business clients, but there must be some form of judicial review or assessment of attorney’s fees in a legal system that is not a “loser pays” system.
By way of example, under s. 3.1 of the Ontario Solicitors Act, O. Reg. 195/04, this form of “gravyboating” is prohibited:
“1. If the client is a plaintiff, a statement that the solicitor shall not recover more in fees than the client recovers as damages or receives by way of settlement.”
That said, the plaintiff’s former counsel are entitled to be paid something for securing a favorable settlement offer; albeit rejected,which was more than double the jury award, as well as the time spent working on the file.
Most contingency fee retainers (in curling country) include a provision that in the event of termination of the retainer by the client, the lawyer will be paid based upon a mutually agreed upon hourly rate, subject to the statutory limit not to exceed the plaintiff’s overall recovery and subject to judicial approval and the client’s right of assessment.
The purpose behind allowing legal fees in excess of the recovery seems rather clear to me. Without it, no lawyer would be willing to take a contingent fee case unless it had a reasonably certain high value, meaning that constitutional violations would go unredressed if the damages weren’t severe. This is one of those rare “good” laws that encourages lawyers to represent those who have suffered, albeit in smaller degrees, so that they have a means of vindicating their rights.
Essentially, the amount of time and effort a lawyer puts into a case has no inherent connection to the extent of a party’s damages. And that’s how it should be.
Well, the math is easy:
Smith and Genson received $83,000 in attorney’s fees,
+
Smith and Genson likely received 40% of the $40,000 damages award (if working on a contingency as well) or $16,000.00
+
Cerda and De Leon received $15,000 for their services (out of the $40,000 jury award)
= about $10,000 net to Elusta.
I doubt Elusta feels his constitutional rights were vindicated, despite the able efforts of his trial attorneys, since Elusta rejected the $100,000 offer and sought reimbursement from his former attorneys for the 60/40 contingency fee split. Clearly, his lawsuit was not about the principle, but, as invariably is the case, it was all about the $$$.
It seems like a lot of what happened here didn’t work out as well as Elusta hoped, starting with the $100k he turned down, to switching lawyers (such that the old lawyers had a quantum meruit claim for their fees), to the amount of the jury verdict. Thing is, Elusta agreed to a 60/40 split on his damage recovery, and that’s what he got. From his share, he has to pay the lawyers who worked for him before, and whose efforts he enjoyed, then spurned.
The new lawyers had no way of knowing whether, and to what extent, they might get statutory fees, and took a blind shot. They got ’em, because that’s what the court allowed. This isn’t money lost to Elusta. He had no claim to this beforehand, and none after. This has nothing whatsoever to do with Elusta.
So Elusta got his 60% of his recorvery, as he agreed to, less the $15,000 quantum meruit claim for the lawyers whose services he used (and should have listened to). The value of his damages didn’t make him a millionaire? That’s how it goes. They rarely do, yet without these lawyers sharing the risk with him, he would have gotten squat. All is right with the world.
How certain are we that Smith and Genson got $83,000 plus 40%?
Can’t be certain (as Judge Wood doesn’t spell it out), but it appears to be the case from the decision.
In the under II it says
“He is referring to the language providing that the client (Elusta) would pay his attorneys “[a] sum equal to 40% of the gross amount recovered from the claim by settlement or Judgment.”
Looks like they got 40% of the 40K.
That’s how I read it as well, though it still doesn’t quite say that.