From Adair v State of Michigan, released today:
We begin our analysis of what constitutes a reasonable hourly rate of compensation for each of plaintiffs’ attorneys by acknowledging that plaintiffs rely heavily on data generated by the State Bar pertaining to the appellate area of practice and that the special master relies, instead, on the data pertaining to the municipal law area of practice. We also acknowledge, however, that actions to enforce the Headlee Amendment, like this one, are sui generis. Such actions, if originally brought in
this Court, are part appellate proceeding and, to the extent that the services of a special master are employed, they are also part trial proceeding in that they involve discovery, motion practice and litigation. The practice areas listed and surveyed by the State Bar do not fully reflect the hybrid nature of these proceedings or the limited and specialized market for attorneys who are familiar with the operation of the Headlee Amendment. Thus, any attempt on our part to shoehorn this matter into one of the areas of practice identified in the various surveys of the State Bar serves no useful purpose. “The reasonable hourly rate represents the fee customarily charged in the locality for similar legal services, which is reflected by the market rate for the attorney’s work.” Smith, 481 Mich at 531 (opinion of Taylor, C.J.). The market for other areas of legal practice with broader client bases and greater demand provide no probative information regarding what constitutes the proper market for the provision of the specialized legal services associated with the enforcement of the Headlee Amendment.
Smith clearly contemplates that the trier of fact must independently review these State Bar surveys and determine what information contained in those surveys is most relevant and helpful to a determining of the market rate for each attorney for whom a reasonable attorney fee is sought. Smith, 481 Mich at 530-532, 537 (opinion of Taylor, C.J.). Because this Court sits as the trial court in this action, we exercise that power of independent review and reject any reliance on the data associated with the areas of practice surveys. Instead, we rely on the data collected statewide with regard to years in practice. We do so because plaintiffs’ attorneys represent school districts and taxpayers located throughout the state and because plaintiffs chose this Court, which has statewide jurisdiction, as the court in which to commence their original action, rather than a circuit court with limited territorial jurisdiction, as allowed by MCL 600.308a(1). We also do so because the number of years in practice is reflective of how experience and demand may be compensated on an hourly basis. Finally, we observe that, in 2003, the median hourly billing rates for attorneys with the same years in practice as the two lead counsels in this case, Pollard and Kroopnick [$175
an hour for Pollard and $180 an hour for Kroopnick], were consistent with the $175-an-hour rate plaintiffs’ attorneys were charging plaintiffs at that time. As we previously observed, “the actual fees charged . . . is a factor to be considered in determining market place value as it is reflective of competition within the community for business and typical fees demanded for similar work.” Van Elslander, 297 Mich App at 234. For these reasons, we conclude that the data reported in the 2003, 2007 and 2010 surveys regarding the years in practice is the “most relevant available data.” Smith, 481 Mich at 532 (opinion of Taylor, C.J.).