Conflict and Solidarity: The Legacy of Evans v. Jeff D.

Georgetown Journal of Legal Ethics, The, Spring 2004 by Nazer, Daniel

Prior to Jeff D., the United States Courts of Appeals were divided on how to approach these fee-related conflicts of interest. The Ninth and Third Circuits disapproved of the simultaneous negotiation of fees and merits.18 Other Courts of Appeals allowed parties to negotiate fees and merits together.19 In Prandini v. National Tea Co., the Third Circuit expressly prohibited simultaneous negotiation.20 The court stated that "[t]his would eliminate the situation . . . having, in practical effect, one fund divided between the attorney and client."21 The court hoped that this would reduce the conflict between attorney and client and help prevent "sweetheart" contracts.22 In contrast, the District of Columbia Circuit allowed at least some simultaneous negotiation of fees and merits.23 The court noted the importance of encouraging settlement and the difficulty of monitoring settlement negotiations between private parties.24

The issue of fee-related conflicts also divided bar association ethics committees. The Association of the Bar of the City of New York ("NYC Bar") prohibited simultaneous negotiation of relief on the merits and fees.25 The District of Columbia Bar ("D.C. Bar") allowed some simultaneous negotiation but prohibited defendants from asking plaintiffs to completely waive their rights to statutory fees.26 The State Bar of Georgia ("Georgia Bar") rejected both positions and allowed all simultaneous negotiation of fees and relief on the merits.27

The bar associations, like the courts of appeals, were divided over how to resolve the tension between encouraging settlement and reducing the potential for conflicts of interest. The NYC Bar emphasized the link between fee waivers and conflicts of interest.28 The NYC Bar argued that fee waiver requests have "the effect of placing the plaintiff's lawyers in conflict with their clients and undercutting the policies of the civil rights statutes which provided for fees and that accordingly the demands were prejudicial to the administration of justice." Accordingly, the NYC Bar reached the same result as the Prandini Court, and prohibited fee waiver requests.

The Georgia Bar emphasized the importance of settlement.30 The Georgia Bar claimed that "[t]o force a defendant into proposing a settlement offer wherein plaintiffs [sic] statutory attorney fees are not negotiated . . . leaves a defendant in a position of exposure that is at best, uncertain, and at worst so tenuous that meaningful settlement proposals might never be made."31 On this basis, the Georgia Bar declined to prohibit the simultaneous negotiation of fees and merits.

B. THE MAJORITY OPINION

Evans v. Jeff D. resolved the split within the courts of appeals. In Jeff D., the Supreme Court considered a Ninth Circuit decision that had invalidated a fee waiver contained in a settlement of a class action.32 Jeff D. was a class action brought on behalf of disabled children in the care of public entities in Idaho.33 The plaintiffs sought injunctive relief intended to improve conditions of care, but they did not seek damages.34 During settlement negotiations the defendants offered almost all of the injunctive relief sought by the plaintiffs.35 The Ninth Circuit noted that this offer was "more than the district court in earlier hearings had indicated it was willing to grant."36 Clearly, the plaintiffs' lawyer would wish to accept such an offer. The problem, however, was that the defendants made their offer conditional on a complete waiver of statutory attorney's fees and costs.37