Attorney fees under the Fair Labor Standards Act (FLSA); 29 USC § 216(b); The lodestar method; Perdue v. Kenny A.; Decision to cap the fees at 35% of plaintiff’s total recovery

The court reversed the district court’s FLSA attorney-fee award, holding that it abused its discretion by capping the fees at 35% of plaintiff-Rembert’s total recovery. Rembert routinely worked over 40 hours a week as a nurse for defendant-A Plus. When she asked about overtime, a supervisor allegedly told her that the nursing home “‘couldn’t make money’ if they paid their employees overtime.” She filed suit and moved to conditionally certify an opt-in class of similarly-situated A Plus employees. The Department of Labor began an investigation, and the district court certified the class. During the litigation, defense counsel repeatedly missed deadlines and refused to respond or communicate with plaintiff. Due to “the Department of Labor investigation, some members of the class received full payment of the amounts owed to them.” Rembert and the remaining class members received an $18,961 judgment, “plus ‘reasonable fees and costs.’” Rembert requested $38,190 in fees and $575 in costs. The district court eventually awarded her $13,790 in fees and costs. She challenged the attorney-fee award, arguing that the district court abused its discretion by capping the fees at 35% of her total recovery. The court agreed, noting that the lodestar method already considered the relevant factors comprising a “reasonable attorney’s fee.” Where a plaintiff only “partially” succeeds in obtaining a recovery, a district court could reasonably award a reduced fee. But Rembert and several class members recovered 100% of what they were due under the FLSA. The court also held that the district court failed to adequately explain what claimed hours it rejected, and to consider “the 100% recovery in this case—or that the actions and omissions of defense counsel indisputably prolonged this litigation and rendered it much less efficient than it could have been.” Reversed and remanded with instructions to grant the petition for $38,765 in fees and costs. The court also granted Rembert’s counsel reasonable appellate fees and costs.