Generally, a failure rate of two-thirds would indicate that what you are doing isn't profitable.  However, when dealing with environmental law, that clearly isn't the case.  In Cascadia Wildlands v. Bureau of Land Management, 987 F.Supp.2d 1085 (D. Or. 2013), after prevailing on only one of three claims, and after the district court imposed a variety of reductions, the court awarded plaintiffs approximately three-quarters of the attorneys' fees requested and 100% of the costs. 

In 2010, the Bureau of Land Management ("BLM") completed its environmental assessment ("EA") for the Alsea River Watershed Restoration project.  The project authorized, among other things, commercial thinning on public lands.  In 2011, after exhausting their administrative remedies, plaintiffs filed a lawsuit in federal court alleging that the EA violated the Federal Land Policy and Management Act ("FLPMA") and the National Environmental Policy Act ("NEPA") because it failed to analyze whether the project would harm the red tree vole. 

On cross-motions for summary judgment, the district court ruled in favor of the defendants on two of the claims, and in favor of the plaintiffs on the third and final claim.  Specifically, the district court found that the BLM did not violate the FLPMA by authorizing the project prior to conducting a pre-disturbance survey for red tree vole sites, and that the BLM had taken the requisite "hard look" at the project's effects on the vole as mandated by NEPA.  However, the district court also found that the BLM violated NEPA by failing to adequately consider a 12-month finding issued by the U.S. Fish and Wildlife Service after the adoption of the EA, which concluded that listing of the north Oregon Coast population of the red tree vole was warranted but precluded by higher priority species.  As a result of this finding, the district court enjoined the BLM from going forward with the project until a supplemental EA was completed.  Because of their partial victory, plaintiffs sought fees under the Equal Access to Justice Act ("EAJA"). 

The purpose of the EAJA is to eliminate the financial deterrent for a private individual to challenge unreasonable government action.  Commissioner v. Jean, 496 U.S. 154, 163 (1990).  Under the EAJA, "a court shall award to a prevailing party other than the United States fees and other expenses . . . incurred by that party in any civil action . . . brought by or against the United States in any court having jurisdiction of that action, unless the court finds that the position of the United States was substantially justified or that special circumstances make an award unjust."  28 U.S.C. § 2412(d).  In the Ninth Circuit, the EAJA has been parsed into a two-part test: 

  1.  Was the plaintiff a prevailing party? 
  2. Was the government substantially justified or are there special circumstances that exist that would make an award of fees unjust?

See Flores v. Shalala, 49 F.3d 562, 567 (9th Cir. 1995).

Addressing the first part of the two-part test, the district court found that it was undisputed that plaintiffs were the prevailing parties.  Thus, the district court briefly turned to the second part of the test.  The court found that in an attempt to oppose an award of fees, the defendants essentially attempted to reargue the merits.  The district court rejected these efforts in short order, stating that it was bound by its previous holding, and therefore the only issue was the appropriate amount of fees and costs to award.

In addition to opposing an award of fees, defendants also attempted to reduce any amount awarded by arguing that an award should be limited to the time spent on the sole NEPA claim that plaintiffs prevailed on.  The district court agreed in part with defendants' argument.

The district court explained that in the Ninth Circuit, when a lawsuit is comprised of distinct claims, an award of fees should not include the time spent on the claims that plaintiffs failed to prevail on.  Analyzing the claims at issue, the district court found that the failed FLPMA claim was distinct from the successful NEPA claim, as the FLPMA claim was "legally, factually, and temporally distinct from plaintiffs' successful NEPA claim."  The district court reached the opposite conclusion with respect to the two NEPA claims, stating:

[P]laintiff's unsuccessful NEPA claim centered on the reasonableness of the BLM's evaluation of evidence that existed before the authorization of the [project], whereas plaintiffs' successful NEPA claim focused on the reasonableness of the BLM's failure to analyze new evidence that emerged five months after the 2010 EA.  Nevertheless, the relief sought pursuant [to] these claims was identical. . . Under these circumstances, the Court cannot conclude that plaintiffs' unsuccessful NEPA claim is separate and distinct from their successful NEPA claim.

Therefore, the court deducted from the fee award any time "clearly attributable" to the FLPMA claim. 

The district court further reduced the number of compensable hours in light of the limited success obtained by plaintiffs.  The court described its ruling as providing merely "limited relief," and not significantly effecting the status of the proposed project, as the BLM could examine the new information, find that it either did not impact the prior NEPA analysis or only required slight revisions, and proceed with the project under a substantially similar EA.  Thus, the court found that a 15% reduction in the total amount of compensable hours was warranted.  The district court also refused to award fees based on time spent for clerical tasks, for which there was an inadequate description, and for preparing expert declarations for a motion that was never filed. 

Finally, the district court turned to the issue of hourly rates.  While the EAJA provides for a statutory rate, the court explained that it has the discretion to award fees in excess of those hourly rates if the attorney possesses distinctive knowledge and specialized skill that was important to the litigation and not otherwise available at the statutory rate.  Applying this rubric, the district court found that an upward departure from the statutory rate was appropriate for plaintiffs' lead attorney, who had over 20 years of environmental litigation experience, but not appropriate for two other counsel who graduated from law school in 2011. 

Multiplying the compensable hours by their respective court-adjusted hourly rates, the district court found that a fee award of $75,035 was appropriate.  As plaintiffs had requested an award of $99,918.45, the court's fee award represented a haircut of only 25%.  Thus, although plaintiffs lost on two-thirds of their claims, and the court acknowledged that its ruling provided "limited relief" that did not significantly affect the status of the project, plaintiffs were able to recover three-quarters of their requested fees and all of their costs.