Inmate Contribution to Attorneys’ Fees Hinges on a Few Words

The gold standard of excellence for more than 80 years, The United States Law Week® is the most authoritative way to keep up with important cases and other legal developments nationwide, in all...

By Madison Alder

The U.S. Supreme Court will hear arguments Dec. 6 to consider how to calculate the attorneys’ fees prisoners who win civil rights suits must pay.

The high court will parse the words of a statute to decide whether “not to exceed 25 percent” means exactly 25 percent, as the Seventh Circuit held below ( Murphy v. Smith, U.S., No. 16-1067, to be argued 12/6/17 ).

That phrase is part of a federal law specifying what portion of a prisoner’s award in a civil rights suit must be paid to the prisoner’s lawyer when the lawyer has been awarded attorneys’ fees.

A decision in Murphy v. Smith could determine if courts have discretion to choose the amount a prisoner pays their attorney from their money judgment as long as it is 25 percent or lower, or if it is fixed at exactly 25 percent.

The “issue arises almost every time a prisoner wins damages” in a suit under the Prison Litigation Reform Act, petitioner Charles Murphy said.

The Seventh Circuit’s interpretation “leaves prisoners whose constitutional rights have been violated with smaller net recoveries than Congress intended them to receive,” Murphy argued in his petition to the Supreme Court.

The statute was enacted to provide compensation to prisoners whose rights have been violated and to deter abuse, the American Civil Liberties Union said in a brief supporting Murphy.

Michigan and 15 additional states voiced their support for the Seventh Circuit’s ruling below. The states are interested in the case because most lawsuits brought by prisoners are against state employees, their amicus brief said.

Reading the 25 percent as an exact figure ensures prisoners have a financial stake in a case and limits the amount of taxpayer money that goes into defending a case, the states said in their brief.

The reading is consistent with the rest of the statute, which includes “bringing prisoners’ litigation incentives in line with those of non-prisoners,” the state’s brief said.

What to Watch

David M. Shapiro, counsel of record for the ACLU’s brief and a professor at Northwestern University Pritzker School of Law, told Bloomberg Law he expects the Supreme Court “to focus on the plain language of the statute during the argument.”

“This is a case where the just outcome and the legally correct outcome line up perfectly,” Shapiro said.

David L. Hudson Jr., a professor at Vanderbilt Law School who wrote a review of the case for American Bar Association, told Bloomberg Law he’ll be “most interested in what Justice Sonia Sotomayor asks.”

Sotomayor “asks very good questions at oral argument” and “shows a keen sensitivity and common sense about constitutional rights,” Hudson said.

Hudson will also be interested to see how Justice Clarence Thomas will view the case. Thomas, known for his silence on the bench, probably won’t ask a question, but has “an extremely narrow view of prisoner’s rights,” Hudson said.

‘Wrong and Unfair’

The Supreme Court’s answer to the question here will likely settle a circuit split where the Seventh Circuit has staked out a position different from its sister circuits that have weighed the issue.

“I saw the Seventh Circuit opinion when it came out, and I thought it was wrong and unfair to prisoners,” Stuart Banner, who represents Murphy, told Bloomberg Law.

The Seventh Circuit’s interpretation would take away the discretion of judges to set the percentage that prisoners will pay at a rate lower than 25 percent of their awards, which would lead to an increase in the amount some prisoners would contribute to fees.

Banner is the director of the UCLA Law School’s Supreme Court Clinic, which filed the petition with the Supreme Court in March. He will argue for Murphy.

The court agreed during the summer recess to hear the case, an unusual time for the court to grant certiorari.

The strange timing possibly could be chalked up to the fact that the justices had open slots on the calendar, Shapiro told Bloomberg Law at the time of the grant. Or it could be that it’s a straightforward statutory interpretation question, he said.

Solicitor General of Illinois David Franklin, who represents the officers, did not respond to a request for comment.

Prisoner Wins Case, Loses Another

Murphy was an inmate at Vandalia Correctional Center in Illinois when he was beaten and left in a cell by two officers. The attack crushed Murphy’s eye socket, among other injuries, according to his petition. His vision is still blurred in that eye after surgery.

Murphy filed a lawsuit against the two officers involved—Robert Smith and Gregory Fulk—in the U.S. District Court for the Southern District Court of Illinois in July 2012 and won. The jury awarded Murphy about $307,700 in damages and ordered him to pay 10 percent of his award to his attorney under the PLRA.

The statute says when a prisoner receives a monetary judgment, “a portion of the judgment (not to exceed 25 percent) shall be applied to satisfy the amount of attorney’s fees awarded against the defendant.” The losing party pays the remainder of attorneys’ fees.

In total, Murphy was ordered to pay about $30,800 of the attorneys’ fees, which totaled about $108,400, and the officers were to pay about $77,700.

The Seventh Circuit reversed the district court on this issue, and required Murphy to contribute 25 percent of his judgment to the attorneys’ fees. That judgment translated to a contribution of about $76,900 from Murphy and about $31,500 from the officers.

The Seventh Circuit pointed to its own ruling in a 2003 case, Johnson v. Daley, in which it interpreted the statue to mean exactly 25 percent.

‘Discretion-Triggering’ Language

The statute doesn’t contain language that would prompt a court to exercise its own discretion when applying a portion of the judgment for attorneys’ fees, the officers argued.

Other statutes contain language that specifically states the court has discretion. The statute here does not, the officers argued.

Michigan also offered grammatical analysis in its brief.

The word “satisfy” indicates that Congress wanted the prisoner to pay the 25 percent contribution in full, Michigan argued. “Not to exceed 25 percent” is a protective ceiling for the contribution to ensure they keep at least 75 percent of the judgment.

The Office of the Michigan Attorney General Bill Schuette declined to comment beyond their brief.

Murphy argued the phrase itself is the discretionary trigger for the court.

“By authorizing district courts to apply a portion of the judgment ‘not to exceed 25 percent,’ the statute plainly gives district courts the discretion to choose any percentage that does not exceed 25 percent,” Murphy said in his response brief.

Jordan S. Rubin in Washington contributed to this report.

To contact the reporter on this story: Madison Alder in Washington at malder@bloomberglaw.com

To contact the editor responsible for this story: Jessie Kokrda Kamens at jkamens@bloomberglaw.com

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

Try U.S. Law Week