This document summarizes a case study on the costs of litigation between the Real Estate Bar Association for Massachusetts (REBA) and National Real Estate Information Services (NREIS). REBA claimed NREIS engaged in unauthorized practice of law, while NREIS counterclaimed under the Dormant Commerce Clause. The court granted summary judgment for NREIS, finding REBA's definition of legal practice violated the Constitution. NREIS then requested attorney's fees, which the court approved after reviewing billing rates, hours worked, staffing levels, and finding the fees reasonable given the complexity and public interest in the case.

1. The Cost of Litigation: A Case Study
Real Estate Bar Ass'n for Mass., Inc. v. Nat'l Real Estate Info. Servs.,
642 F. Supp. 2d 58 (D. Mass. 2009)
Professor Forgues’ Business Law Class
November 19, 2009
By Kevin M. O’Shea, Esq.

2. ftp.oshea.org/PSU/
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3. The Parties
 The Plaintiff
 The Real Estate Bar Association for Massachusetts, Inc.
("REBA”)
 Represented (primarily) by Yurko, Salvesen & Remz and
Holland & Knight.
 The Defendant
 National Real Estate Information Services and National Real
Estate Information Services, Inc.'s (collectively "NREIS")
 Represented (primarily) by K&L Gates.
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4. Plaintiff’s Cause of Action
 REBA claimed that NREIS had engaged in the
unauthorized practice of law in Massachusetts
 by performing real estate conveyances,
 conducting so-called "notary closings,"
 and issuing title insurance.
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5. Defendant’s Counterclaim I
 NREIS counterclaimed under 42 U.S.C. § 1983
 that REBA's interpretation of the practice of law,
 and enforcement of that interpretation,
 violated the Dormant Commerce Clause of the U.S.
Constitution.
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6. Defendant’s Counterclaim II
 42 U.S.C. § 1983
 Every person who, under color of any statute, ordinance,
regulation, custom, or usage, of any State…
 subjects, or causes to be subjected, any citizen of the
United…
 to the deprivation of any rights, privileges, or immunities
secured by the Constitution and laws,
 shall be liable to the party injured in an action at law, suit
in equity, or other proper proceeding for redress…
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7. Defendant’s Counterclaim III
 Dormant Commerce Clause
 The Commerce Clause, U.S. Const. art. I, § 8, cl. 3 grants
Congress the power to regulate commerce among the
several states.
 Courts have interpreted that affirmative grant of power to
the federal sovereign to strip state governments of any
authority to impede the flow of goods or services between
states.
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8. Defendant’s Counterclaim IV
 Dormant Commerce Clause
 That so-called "Dormant Commerce Clause" doctrine
prohibits the economic protectionism embodied in the
preservation of local industry by protecting it from the
rigors of interstate competition.
 A party may enforce its right to be free from state
regulation of the interstate flow of goods or services under
42 U.S.C. § 1983.
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9. Procedural Posture
 Real Estate Bar Ass'n for Mass., Inc. v. Nat'l Real Estate
Info. Servs., 609 F. Supp. 2d 135 (D. Mass. 2009)
 NREIS's Motion for Summary Judgment on Dormant
Commerce Clause Counterclaim are ALLOWED, and
 REBA's Motion for Summary Judgment is DENIED.
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10. What is Summary Judgment?
 A court may grant summary judgment when the moving
party has shown that there is no genuine issue as to any
material fact and that the moving party is entitled to
judgment as a matter of law.
 The court must examine the facts in the light most
favorable to the nonmoving party, resolving any
reasonable inference in that party's favor.
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11. Claims Resolved I
 Conferring the "practice of law" label on an activity
effectively bars out-of-staters from offering a commercial
service within the commonwealth's borders and
 confers the right to provide that service, and to reap the
associated economic benefit,
 upon a class largely composed of Massachusetts citizens.
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12. Claims Resolved II
 An overbroad definition of the practice of law would
have a substantial effect on interstate commerce.
 It is highly unlikely that Massachusetts lawyers could
provide the same services at the same expense to the
customer as NREIS provides.
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13. Claims Resolved III
 Evidence for this proposition are "the savings normally
attributable to large scale operation" and "the very
existence of national companies like [NREIS].”
 Moreover, REBA's definition of the practice of law would
"deprive the citizens of Massachusetts of any benefits
arising from competition.
 Real Estate Bar Ass'n for Mass., Inc. v. Nat'l Real Estate Info.
Servs., 609 F. Supp. 2d 135 (D. Mass. 2009)
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14. Procedural Posture
 Motion for Attorneys’ Fess and Costs
Pursuant to 42 U.S.C. § 1988
 Real Estate Bar Ass'n for Mass., Inc. v. Nat'l Real Estate Info.
Servs., 642 F. Supp. 2d 58 (D. Mass. 2009)
 42 U.S.C. § 1988
 “In any action or proceeding to enforce a provision of
sections…1983…the court, in its discretion, may allow the
prevailing party, other than the United States, a
reasonable attorney’s fee as part of the costs…”
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15. Who is the Prevailing Party? I
 “A prevailing party is one who has succeeded on any
significant issue in litigation which achieves some of the
benefit the parties sought in bringing suit.”
 In other words, a party prevails "when the actual relief
on the merits of his claim materially alters the legal
relationship between the parties by modifying
defendant's behavior.”
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16. Who is the Prevailing Party? II
 “Holding that REBA violated the Dormant Commerce
Clause, and issuing a permanent injunction in NREIS's
favor, resulted in a material alteration of Parties' legal
relationship.
 REBA is now "enjoined from enforcing on NREIS its
interpretation of the practice of law as encompassing
 (1) all the interconnected activities of a real estate
conveyance and
 (2) the issuance of title insurance.”
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17. How does the Court Calculate
Attorneys’ Fees?
 The court employs a two-step process to determine the
reasonable fees.
 First, "the number of hours reasonably expended on the
litigation [is] multiplied by a reasonable hourly rate" to
reach the "lodestar" figure.
 Second, the court may adjust "the reasonable fee upward
or downward if any special factors dictate such a result."
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18. The Loadstar Figure
 K&L Gates divided its efforts in this matter into four
general phases:
 (1) "Development and Evaluation of Case; Answers and
Counterclaim; Motion to Dismiss Attorney Solomon";
 (2) "Discovery";
 (3) "Summary Judgment on Defenses, Counterclaim";
and
 (4) "Fee Application.”
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19. Phases of Litigation I
 These phases consisted of the following efforts:
 preparing and filing the Notice of Removal;
 preparing and filing the Answer, Counterclaim, and Motion
to Dismiss;
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20. Phases of Litigation II
 reviewing and producing documents; serving document
requests on REBA;
 reviewing documents produced by REBA;
 engaging in discovery conferences;
 engaging in a protective order dispute, and briefing that
dispute for this court;
 deposing nine different witnesses and defending a
deposition of NREIS;
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21. Phases of Litigation III
 preparing and filing the Motion for Summary Judgment
and Motion for Summary Judgment on Dormant
Commerce Clause Counterclaim;
 responding to REBA's Motion for Summary Judgment;
 responding to REBA's Motion to Amend and Alter
Judgment; and
 preparing and filing this fee application.
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22. Invoice Descriptions I
 In its invoices, K&L Gates meticulously recorded all the
relevant billing information, including
 the date on which the work had been completed,
 the name of the attorney who had rendered the work,
 the number of hours the attorney had expended,
 a description of the attorney's efforts,
 the total amount that the attorney charged for the work,
 a list of disbursements and other charges, and
 a monthly summary.
22

23. Invoice Descriptions II
 From the total number of hours expended on this case,
K&L Gates deducted $ 18,324.25 in unnecessary fees
and a 10% fee discount.
 As of NREIS's most recent fee request, attorneys and
staff members at K&L Gates had billed a total of
2,201.60 hours to NREIS.
 After deductions, NREIS requests fees for a total of
2,112.00 hours of work.
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24. Staffing the Case I
 As part of its documentation of these hours, K&L Gates
listed the
 eight partners,
 ten associates,
 and six staff members who billed time for this case.
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25. Staffing the Case II
 Of these individuals,
 partners Irene Freidel and Michael Ricciuti, and
 associates Robert Sparkes and Leanne Hartmann,
 billed approximately 88% of the total hours requested.
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26. Staffing the Case-Freidel
 Ms. Freidel
 graduated from the University of Michigan Law School in
1991;
 has experience in commercial litigation and other areas of
complex civil litigation, including contracts,
environmental, employment discrimination, products
liability, and civil rights;
 and billed 594.20 hours for this case
 (approximately 28% of the total hours requested)
 at hourly rates of $ 410, $ 490, $ 540, and $ 575.
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27. Staffing the Case-Hartmann
 Ms. Hartmann
 graduated from the University of Michigan Law School in
2006;
 has experience in commercial litigation;
 and billed 107.30 hours for this case
 (approximately 5% of the total hours requested)
 at hourly rates of $ 325 and $ 365.
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28. Staffing the Case-Ricciuti
 Mr. Ricciuti
 graduated from Harvard Law School in 1987;
 has experience in criminal matters, internal investigations,
complex domestic and international commercial
arbitrations and cases, matters related to homeland
security, and matters involving foreign assets and export
controls;
 and billed 375.10 hours for this case
 (approximately 18% of the total hours requested)
 at hourly rates of $ 535, $ 590, and $ 625.
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29. Staffing the Case-Others
 Other Partners (6)
 Other Associates (7)
 Staff, including
 Paralegals,
 a Legal Intern,
 Litigation, and
 A Legal Librarian
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30. Block Billing I
 REBA argues that NREIS's documentation lacks
information necessary to determine whether the time
that K&L Gates spent in furtherance of this case was
excessive, redundant, or unreasonable.
 In support, REBA cites K&L Gates's block billing method,
by which it would combine all the tasks that an attorney
had performed in a given day into a single invoice entry.
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31. Block Billing II
 A review of K&L Gates's invoices reveals that its
attorneys and staff members provided
 clear,
 well-organized, and
 sufficiently detailed explanations of all the tasks that they
completed for this case.
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32. Block Billing III
 The party seeking fees
 "is not required to record in great detail how each minute
of his time was expended,”
 but "must ensure that contemporaneous time records are
kept in reasonable detail.”
 NREIS has met this standard.
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33. Redactions I
 K&L Gates's redactions do not merit a reduction in fees.
For the invoice entries to which K&L Gates made
redactions, it left portions unredacted so as to provide
an explanation of the work performed.
 In addition, NREIS satisfactorily complied with this
court's request to file nonprivileged descriptions of the
documentation that remained redacted.
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34. Redactions II
 K&L Gates combed through its billing invoices line-by-
line and explained the reason for each redaction, citing
 attorney-client communication,
 work product, or
 expert-related work product.
 The unredacted portions of the invoices and K&L Gates's
nonprivileged descriptions of the redacted material are
sufficient to establish that the time spent was
reasonable and in furtherance of this litigation.
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35. Summary Judgment & Overstaffing I
 REBA contends that the time that K&L Gates expended
on Parties' summary judgment motions was
 unreasonable and that
 K&L Gates otherwise overstaffed this case.
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36. Summary Judgment & Overstaffing II
 K&L Gates billed 453.50 hours on Phase III, summary
judgment.
 a substantial amount of time for preparing and opposing
motions for summary judgment.
 But, given the unique circumstances of this case, this
amount of time was reasonable.
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37. Summary Judgment & Overstaffing III
 Moreover, REBA had the support of the Massachusetts Bar
Association ("MBA”).
 In addition to the vigorous and high-quality advocacy in this
case, NREIS had to address complex and novel issues of
commercial, constitutional, state, and federal law.
 Increasing the stakes of litigation were the significant public
interest implicated by this case, and the financial
consequences NREIS would have faced had it lost.
 The combination of these factors reasonably led to the
substantial amount of time that K&L Gates devoted to the
critical summary judgment stage, and other phases of the
litigation.
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38. Summary Judgment & Overstaffing IV
 Nor was K&L Gates's staffing of this case improper.
Though a total of twenty-four individuals billed time for
this matter, two partners and two associates performed
the majority of the work.
 The above factors reasonably justified this level of
staffing.
 As the First Circuit has stated, "[g]iven the complexity
of modern litigation, the deployment of multiple
attorneys is sometimes an eminently reasonable tactic.”
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39. Hourly Rate I
 Next, the court determines "the reasonableness of the
hourly rate claimed” by reviewing "the prevailing
market rates . . . in the community for similar services
by lawyers of reasonably comparable skill, experience
and reputation.”
 In addition, "the court is entitled to rely upon its own
knowledge of attorney's fees in its surrounding area in
arriving at a reasonable hourly rate” and
 may "apply different hourly rates for work done at
different stages of the case.”
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40. Hourly Rate II
 K&L Gates submitted two affidavits demonstrating the
reasonableness of its rates.
 The first was by Mr. Ricciuti, who stated that the rates
were "reasonable given the fees usually charged for
similarly-qualified professionals in Boston.”
 The second was by a partner at the Boston law firm Dwyer
& Collora, who conducted an independent fee comparison
and attested that the "rates billed were reasonable.”
 Because K&L Gates's rates were proportionate to each
attorney's level of expertise and the complexity of the
work actually rendered, this court finds the billing rates
to be reasonable.
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41. Hourly Rate-Commercial Litigator or
Civil Rights Litigator? I
 REBA also requests this court to reduce NREIS's award to
reflect "the prevailing rates for civil rights work" rather
than "the prevailing rates of commercial litigators.”
 REBA estimates these hourly rates to be
 $ 300 "for an attorney in Boston with significant civil rights
experience,"
 $ 200 to $ 250 for a "senior litigation associate with five or
more years civil rights experience,”
 $ 175 for "a junior litigation associate," and
 "$ 60 for paralegals.”
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42. Hourly Rate-Commercial Litigator or
Civil Rights Litigator? II
 First, NREIS's posture as the defendant in this action,
and the plaintiff on its counterclaim, strongly militates
against reducing its hourly rate.
 As already discussed, in defending this suit, NREIS
faced a bar association as plaintiff and the entire MBA
as amicus curiae.
 Filing notices of appearance on behalf of REBA were
attorneys from the international commercial law firm
Holland & Knight.
 It was entirely reasonable for NREIS to respond by hiring
a prestigious litigation firm itself.
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43. Hourly Rate-Commercial Litigator or
Civil Rights Litigator? III
 Moreover, the significant public interest implicated in
this case, coupled with the severe financial
consequences that NREIS could have faced had REBA
succeeded, all support allowing NREIS to recover fees
based on the full rates of K&L Gates's commercial
litigators.
 NREIS had no choice but to present a complete defense,
including its counterclaim, to REBA's attempts to
enforce the unlawful practice of law statute.
43

44. Hourly Rate-Commercial Litigator or
Civil Rights Litigator? IV
 The commercial nature of this matter supports a fee award
predicated on the rates of commercial litigators.
 The novel questions of state and federal law at issue in this
case necessitated an understanding of real estate
conveyancing, the provision of title insurance, and the
market for providing such services.
 REBA having argued that NREIS's provision of real estate
conveyancing and title insurance services violated the
Massachusetts unlawful practice of law statute, it was
necessary for NREIS to hire a law firm fully capable of
understanding those services and the threat to which REBA's
suit posed.
44

45. Hourly Rate-Commercial Litigator or
Civil Rights Litigator? V
 Dormant Commerce Clause "cases are often complex"
and "involv[e] complex commercial and constitutional
litigation.”
 Unlike the customary civil rights case, NREIS had good
reason to expect that its defense and Dormant
Commerce Clause counterclaim would be best
understood and litigated by a corporate law firm.
45

46. Total Fees I
 K&L Gates's total fees
 for the four phases of this litigation,
 after deducting $ 18,324.25 in unnecessary work and
 the 10% fee discount,
 amounted to $ 851,063.35.
46

47. Total Fees II
 Additionally, NREIS requests
 $ 48,471.89 in routine litigation costs and
 $ 4,540.93 in costs relating to NREIS's Rule 30(b)(6)
depositions.
 REBA not having offered a substantive opposition to that
request, it is allowed.
 NREIS's total award for attorneys' fees and costs,
therefore, is $ 904,076.17.
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48. Fee Adjustment
 After computing the lodestar figure, "[i]n rare circumstances
the district court can increase a fee award because of the
quality of the work performed or the great public importance
of the case.”
 NREIS requests a fee enhancement "only to the extent the
Court finds that K&L Gates' actual fee and costs exceed the
Court's lodestar calculation.”
 This court agrees that "this case was handled extraordinarily
well by both sides with the minimum of delay” and finds that
the lodestar figure will fairly compensate NREIS for its
attorneys' fees and costs.
 This court therefore does not apply a fee multiplier.
48

49. Conclusion
 NREIS's Motion for Attorneys' Fees and Costs Pursuant to
42 U.S.C. § 1988 is ALLOWED.
 Court awards NREIS $ 904,076.17 in attorneys' fees and
costs.
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50. Could it have been worse?
 What if summary judgment had been denied and there
had been a trial or an appeal after trial?
 What if there had been no prevailing party?
 What if both parties had prevailed in some part?
 Should plaintiff have seen the counterclaim coming?
 Not only didn’t plaintiff win, they had to pay their own
fees and almost $1 million of the defendant’s fees
 Should plaintiff have filed a Motion to Amend and Alter
Judgment after it lost summary judgment?
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51. Other Considerations
 Deep Pocketed Defendants
 Judgment Proof Defendants
 Continuing relationship between parties
 e.g. Landlords and Tenants
 ADR
 Mandatory Arbitration
51

52. "By and large, the court should defer to the
winning lawyer's professional judgment as to how
much time he was required to spend on the case;
after all, he won, and might not have,
had he been more of a slacker."
Moreno v. City of Sacramento,
2008 U.S. App. LEXIS 15951 at *7
(9th Cir. July 28 2008) (Kozinski, C.J.).
52