Laffey Matrix - Overview - Attorney Fee Reasonable Hourly Rates

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. The fees awarded in this case were for work done primarily in 1981 and 1982. To determine reasonable rates for later periods, the United States Attorney’s Office has adjusted these original rates in accordance with changes in the Bureau of Labor Statistics (BLS) Consumer Price Index for All Urban Consumers (CPI-U) for the Washington-Baltimore area. The result has been a routinely updated United States Attorney’s Office Matrix; a table which provides hourly rates, based on years of experience, for attorneys, paralegals and law clerks in the Washington, D.C. area.

The United States Attorney in the Department of Justice (DOJ) continues to use a version of the Laffey Matrix, whereby a legal fee matrix from the Court is used as the basis, and then the CPI for "all goods and services" in the DC area is used to update the fees. (US Attorney's Office, District of Columbia 2005)

One court, The District Court for the District of Columbia, has instead ruled that it is more appropriate to utilize an adjusted Adjusted Laffey Matrix. See 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 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 and decided that 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 expressly disapproved reliance on the Laffey Matrix in Robinson v. Equifax Information Services, LLC, 560 F.3d 235 (4th Cir. 2009), requiring instead that fee awards be based on prevailing market rates established by evidence.

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).

Other courts have rejected the Adjusted Laffey Matrix, particularly for cases in the Washington-Baltimore region, and instead continue to rely on the original Laffey Matrix (also known as the USAO Laffey Matrix). See, e.g., Pleasants v. Ridge, 424 F. Supp. 2d 67, n.2 (D.D.C. 2006) and Judicial Watch, Inc. v. BLM, No. 07-1570, 2008 U.S. Dist. LEXIS 49069.

Despite the initial appeal of using a consumer price index for legal services to update the hourly rates for legal services, closer examination reveals the inappropriateness of it in many cases. The Legal Services component of the National CPI measures price changes in simple legal services used by household consumers, such as basic wills, uncontested divorces, power of attorneys and DWI defenses. Prices for business related services and complex litigation cases are excluded from the index. Contingency fees such as those that are commonly used in litigation settings are not taken into account since they are not relevant to these basic consumer legal services. To determine prices, the BLS contacts practicing attorneys and records prices for a defined “procedure” (such as an uncontested divorce) rather than an hourly unit of an attorney’s or paralegal’s time. Discounted fees are not incorporated into the data unless the contacted attorney routinely gives one for a specific service. The US CPI for Legal Services is not specific to Washington, DC, and so a national price index to update regional rates is also problematic. For these reasons many courts and expert economists continue to rely on the original Laffey Matrix for litigation cases in the DC area. See, for example, affidavit of Dr. Laura A. Malowane in Norden v. Clough, No. 05-1231 (RMC) (D.D.C.)