United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued March 18, 2008 Decided September 2, 2008
No. 07-5053
YVONNE G. TROUT AND
CLARA A. PERLIGIERO,
APPELLANTS
v.
SECRETARY OF THE NAVY AND
COMMANDING OFFICER NAVAL COMMAND SYSTEMS SUPPORT
ACTIVITY,
APPELLEES
Appeal from the United States District Court
for the District of Columbia
(No. 73cv00055)
Bradley G. McDonald argued the cause for appellants.
With him on the brief was John F. Karl, Jr..
Daniel F. VanHorn, Assistant U.S. Attorney, argued the
cause for appellees. With him on the brief were Jeffrey A.
Taylor, U.S. Attorney, and R. Craig Lawrence, Assistant U.S.
Attorney.
Before: SENTELLE, Chief Judge, and GINSBURG and
BROWN, Circuit Judges.
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Opinion for the Court filed by Chief Judge SENTELLE.
SENTELLE, Chief Judge: In the latest saga of this apparently
never-ending battle between the parties over liability and
damages for violating Title VII of the Civil Rights Act, the
district court denied a motion of Appellants Trout, et al., (“the
Trout class”) seeking pre-November 21, 1991, interest on
backpay and attorneys’ fees awarded to them for being subject
to sex discrimination in employment during the 1970’s. The
Civil Rights Act of 1991, which included a provision for the
award of prejudgment interest, was enacted on November 21 of
that year. Although this court previously held that the interest
provision did not apply to conduct that preceded enactment of
the Civil Rights Act, Trout v. Secretary of the Navy, 317 F.3d
286 (D.C. Cir. 2003) (“Trout IV”), the Trout class claims that a
subsequent Supreme Court case, Republic of Austria v. Altmann,
541 U.S. 677 (2004), is an “intervening change in law” that
entitles them to interest on backpay and attorneys’ fees that
accrued before the change in law. The district court also granted
Appellee Navy’s motion for a refund of interim attorneys’ fees
and costs paid to the Trout class for litigating the interest issue.
Because Altmann is inapposite and because the interest issue is
distinct from the issue of sex discrimination, we affirm the
district court’s rulings on the motions.
Background
In 1973 Yvonne Trout and other female employees of the
Department of the Navy filed an employment discrimination
lawsuit against the Navy, alleging sex discrimination in
violation of Title VII of the Civil Rights Act of 1964 (“the 1964
Act”), 42 U.S.C. § 2000e et seq. After twenty years of litigation
the parties entered into a stipulation settling the case on its
merits, which was approved by the district court on November
22, 1993 (hereinafter “Consent Decree”). Pursuant to the
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Consent Decree and other stipulations and orders, the Navy paid
the Trout class backpay for the period 1970 to 1992, as well as
attorneys’ fees up until 1993 for litigating the sex discrimination
matter. The doctrine of sovereign immunity shields the
government from liability for such payments, except when
waived by statute. See Gomez-Perez v. Potter, 128 S.Ct. 1931,
1942 (2008). Subsections 2000e-5(g) and 2000e-5(k) of the
1964 Act waive the government’s immunity from liability for
backpay and attorneys’ fees, respectively, for violations of that
act. Because the 1964 Act did not allow for the payment of
interest on damages, and because any waiver of sovereign
immunity must be strictly construed in favor of the government,
see, e.g., Library of Congress v. Shaw, 478 U.S. 310, 318
(1986), and further because of the no-interest rule, i.e., “the
historical rule that interest is a separate element of damages and
may be recovered only against a party that has agreed to be
liable therefor,” Brown v. Sec’y of the Army, 78 F.3d 645, 651
(D.C. Cir. 1996), under the 1964 Act the Trout class was not
entitled to receive interest on the backpay and attorneys’ fee
awards. On November 21, 1991, however, Congress amended
Title VII. Civil Rights Act of 1991 (“the 1991 Act”), Pub. L.
No. 102-166, 105 Stat. 1071. Under section 114(2) of that act
the government is liable for “the same interest to compensate for
delay in payment [as is available] in cases involving nonpublic
parties.” 42 U.S.C. § 2000e-16(d). The Navy consequently
agreed to pay interest on its liability for backpay and attorneys’
fees incurred after November 21, 1991. The Navy argued,
however, that section 114(2), 42 U.S.C. § 2000e-16(d), was not
retroactive and therefore it was not liable for interest on backpay
and attorneys’ fee awards for periods prior to November 21,
1991. The Trout class argued otherwise and litigated the issue,
culminating in this court’s resolution of the matter in Trout IV.
In the meantime, pursuant to stipulations and orders in 1999 and
2001, the Navy paid the Trout class $106,375.45 in attorneys’
fees and expert fees for litigating the pre-November 21, 1991,
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interest issue.
In Trout IV we addressed the question of whether section
114(2), 42 U.S.C. § 2000e-16(d), has retroactive effect. In
determining that it did not, we relied on our decision in Brown,
78 F.3d 645, which also concerned the question of whether
section 114(2), 42 U.S.C. § 2000e-16(d), applies retroactively.
See Trout IV, 317 F.3d at 290-92. Brown in turn relied on the
Supreme Court’s decision in Landgraf v. USI Film Prods., 511
U.S. 244 (1994), in which the Court declined to give retroactive
effect to provisions of the 1991 Act that would attach new
monetary liability to conduct occurring before the statute’s
enactment. See Brown, 78 F.3d at 648-49. Guided by Brown
and Landgraf, we held that section 114(2), 42 U.S.C. § 2000e-
16(d), does not apply to conduct that occurred before November
21, 1991, and therefore the Navy was not liable for interest on
backpay and attorneys’ fees awarded for conduct before that
time. Trout IV, 317 F.3d at 292-93. We remanded the case to
the district court for a “final determination of costs and fees
owed to the Trout class.” Id. at 293.
On remand, the Navy filed a motion seeking a refund from
the Trout class for $106,375.45, plus interest, that was paid by
the Navy to the Trout class for attorneys’ fees for litigating the
prejudgment interest issue. The Trout class also filed a motion
seeking, despite this Court’s decision in Trout IV, an entry of
judgment for pre-November 21, 1991, interest on backpay and
attorneys’ fees. The Trout class claimed in the motion that the
Supreme Court’s decision in Altmann is an intervening and
controlling decision that entitles them to pre-November 21,
1991, interest. The district court granted the Navy’s motion and
ordered the Trout class to refund the Navy the $106,375.45 plus
interest awarded to the Trout class for litigating the interest
issue; the court denied the Trout class’s motion to award it pre-
November 21, 1991, interest in light of Altmann. Trout v.
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Winter, 464 F. Supp. 2d 25, 34 (D.D.C. 2006).
Discussion
The Trout class now appeals the district court’s rulings on
the motions, arguing, inter alia, that under Altmann it is entitled
to pre-November 21, 1991, interest on backpay and attorneys’
fees, and that as the “prevailing party” in the sex discrimination
litigation it is entitled to attorneys’ fees incurred in litigating the
interest issue.
Altmann
Despite this Court’s holding in Trout IV that section 114(2)
of the 1991 Act does not apply to conduct that preceded its
enactment, the Trout class argues that Altmann “constitutes an
intervening change in law that requires reversal” of Trout IV.
Altmann concerned a suit filed sometime after 1998 against the
state of Austria for conduct that occurred for the most part in
1948. 541 U.S. at 681-84. The Foreign Sovereign Immunities
Act of 1976 (“FSIA”), 28 U.S.C. § 1602 et seq., grants foreign
states immunity from suits in the United States subject to certain
exemptions. The question for the Court was whether the FSIA,
and therefore the exemptions thereunder, applied to claims
based on conduct that occurred before the FSIA’s enactment.
Altmann, 541 U.S. at 686-87. As discussed in more detail
below, the Court held that the FSIA does apply to pre-enactment
conduct. Id. at 697. Attempting to analogize its case to
Altmann, the Trout class argues that Altmann now controls
statutes that concern waivers of sovereign immunity, and
consequently under Altmann, section 114(2) of the 1991 Act, 42
U.S.C. § 2000e-16(d), applies to conduct that preceded its
enactment. The Trout class therefore claims that it is entitled to
interest on backpay and attorneys’ fees incurred prior to
November 21, 1991. We disagree.
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In Altmann the plaintiff sued Austria for expropriating,
before and after World War II, paintings owned by her family.
Austria asserted the defense of sovereign immunity. As noted
above, the question addressed by the Court was whether the
FSIA applied to conduct that occurred prior to the FSIA’s
enactment in 1976. Altmann, 541 U.S. at 686-87. In answering
this question the Court first looked to the default rule of no
retroactive effect of congressional enactments announced in
Landgraf, 511 U.S. at 263, 280. Altmann, 541 U.S. at 692-94.
The Court noted that under Landgraf there is a presumption
against retroactivity if Congress has not expressly stated that the
statute is to have retroactive effect and the statute affects rights,
liabilities, or duties with respect to past conduct. Id. at 693-94
(citing Landgraf, 511 U.S. at 676). On the other hand, the Court
noted that the application of a statute to future as well as
pending cases would be sanctioned if the statute merely confers
or ousts jurisdiction. Id. at 693. The Court noted that although
these principles seemed comprehensive, they did not provide a
clear answer in the case before it because the FSIA could not be
categorized as exclusively affecting either substantive rights or
procedural matters. Id. at 694. The Court then noted that the
purpose of the antiretroactivity presumption is “to avoid
unnecessary post hoc changes to legal rules on which parties
relied in shaping their primary conduct,” and that this had never
been the purpose of foreign sovereign immunity. Id. at 696.
Rather, stated the Court, foreign sovereign immunity aims to
protect foreign states “‘from the inconvenience of suit as a
gesture of comity.’” Id. (quoting Dole Food Co. v. Patrickson,
538 U.S. 468, 479 (2003)). The Court consequently looked to
the FSIA and the circumstances surrounding its enactment for
any suggestion that it should not apply to the 1948 conduct at
issue. Id. at 697. In holding that the FSIA applies “to all
pending cases regardless of when the underlying conduct
occurred,” the Court relied on “[t]he FSIA’s overall structure”
as well as “two of the Act’s principal purposes: clarifying the
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rules that judges should apply in resolving sovereign immunity
claims and eliminating political participation in the resolution of
such claims.” Id. at 698-99. Additionally, the Court looked to
Congress’s understanding of the FSIA as noted in its preamble,
which provides that “[c]laims of foreign states to immunity
should henceforth be decided by courts of the United States and
of the States . . . with the principles set forth in” the Act. Id. at
697 (quoting 28 U.S.C. § 1602) (emphasis omitted). The Court
noted that pursuant to this language “[i]mmunity ‘claims’–not
actions protected by immunity, but assertions of immunity to
suits arising from those actions–are the relevant conduct
regulated by the Act.” Id.
The Trout class argues that in applying the FSIA
retroactively Altmann held that the default rule against
retroactivity announced in Landgraf “does not apply to
statutory waivers of sovereign immunity.” In support of this
argument the Trout class contends that the Supreme Court in
Altmann adopted Justice Scalia’s concurring opinion in
Landgraf, see id. at 697-98; the class argues that consequently
whether a statutory waiver of sovereign immunity may be
applied retroactively should not be determined by the dates of
the discriminatory conduct proven during the liability phase, but
by the date of the assertion of a waiver of sovereign immunity.
In other words, according to the Trout class, the relevant
conduct for the purpose of retroactivity analysis in Altmann was
not the expropriation, which predated the FSIA, but rather
Austria’s invocation of sovereign immunity at the time of the
suit. Quoting from Altmann that “assertions of immunity to
suits . . . are the relevant conduct regulated by the [FSIA],” 541
U.S. at 697, the Trout class contends that the “same interest”
provision of section 114(2), 42 U.S.C. § 2000e-16(d), “logically
can apply only to cases in which judgment on the merits is
entered after enactment, because where there is no judgment,
there can be no judgment interest, and hence no assertion of a
8
defense of sovereign immunity against the payment of
prejudgment interest.”
The Trout class concludes that consequently section 114(2),
42 U.S.C. § 2000e-16(d), “applies to all judgments entered after
the effective date of the Act,” and therefore it is entitled to
interest on backpay and attorneys’ fees incurred prior to
November 21, 1991.
In Trout IV we held that section 114(2), 42 U.S.C. § 2000e-
16(d), does not apply to conduct that preceded its enactment on
November 21, 1991. 317 F.3d at 292. In doing so we relied on
Brown which in turn relied on Landgraf and its default rule
against retroactivity. We find nothing in Altmann that alters the
rule under Landgraf. Altmann expresses no disagreement with
the decision in Landgraf. Instead, the Court in Altmann stated
that the retroactivity inquiry set forth in Landgraf “does not
provide a clear answer in this case” because “the FSIA defies
such categorization.” 541 U.S. at 694. Resolution of the
question before the Court turned on an analysis of the FSIA
itself. In holding that the FSIA applies “to all pending cases
regardless of when the underlying conduct occurred,” the Court
relied specifically on the history of foreign sovereign immunity,
Congress’s understanding of the FSIA as noted in its preamble,
“[t]he FSIA’s overall structure” as well as “two of the Act’s
principal purposes.” Id. at 696-99. It is clear, then, that the
Court’s decision in Altmann was specific to the statute in that
case. The Court itself reinforced this conclusion by stating that
its analysis encompassed a “sui generis context.” 541 U.S. at
696. And in Fernandez-Vargas v. Gonzalez, 548 U.S. 30
(2006), the Supreme Court noted that its “conclusion in
[Altmann], that Landgraf was to be avoided, turned on the
peculiarities of the Foreign Sovereign Immunities Act.” Id. at
38 n.6. Just as in Fernandez-Vargas, “[t]hose peculiarities are
absent here, and we thus advert to Landgraf, as we ordinarily
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do.” Id. In sum, Altmann has no effect upon the holding in
Landgraf and consequently this Court’s decision in Trout IV
stands.
Distinction of claims
Section 113 of the Civil Rights Act of 1991, 42 U.S.C. §
2000e-5(k), states: “In any action or proceeding under this
subchapter the court, in its discretion, may allow the prevailing
party . . . a reasonable attorney’s fee (including expert fees) as
part of the costs . . . .” There is no dispute that the Trout class
was the prevailing party on the primary issue of sex
discrimination and that it is entitled to an award of attorneys’
fees from the Navy for litigating that issue. The Trout class
contends, however, that even if it is determined that it is not
eligible for pre-November 21, 1991, interest on backpay and
attorneys’ fees, the district court nevertheless erred when it ruled
that the class was not entitled to recovery of the attorneys’ fees
incurred for litigating that issue. In Hensley v. Eckerhart, 461
U.S. 424 (1983), the Supreme Court addressed the question of
whether a plaintiff who has succeeded on a significant claim,
and therefore is entitled to attorneys’ fees for work done on that
claim, is also entitled to attorneys’ fees for work performed on
an unsuccessful claim. The Court, “recogniz[ing] that there is
no certain method of determining when claims are ‘related’ or
‘unrelated,’” 461 U.S. at 436 n.12, held that attorneys’ fees
should not be awarded for an unsuccessful claim when that
claim “is distinct in all respects from [the plaintiff’s] successful
claims.” Id. at 440 (emphasis added). The Navy argues that the
interest issue is distinct from the sex discrimination issue and
therefore no attorneys’ fees should be awarded for litigating that
issue.
The Trout class asserts that the issues are in fact not
distinct, claiming that, for purposes of collecting attorneys’ fees,
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it remains the “prevailing party” in the sex discrimination
litigation, and that its request for pre-November 21, 1991,
interest was part of that litigation because such interest was
intended to compensate the class for damages due to “the
Navy’s bad faith delays.” For authority the Trout class relies on
Cody v. Hillard, 304 F.3d 767, 773 (8th Cir. 2002), in which the
Eighth Circuit, in determining whether to award attorneys’ fees
to the plaintiffs for civil rights litigation, considered, inter alia,
the plaintiffs’ “considerable success in the litigation as a whole,”
and whether issues litigated later were “inextricably
intertwined” with the issues upon which the plaintiffs prevailed.
Id. at 773-74. Here, argues the Trout class, the 1993 Consent
Decree gave them “maximum success,” and furthermore the
interest issue is “‘inextricably intertwined’ with the awards of
backpay and attorneys’ fees because the class would have no
claim for interest if it were not the “prevailing party” in the
underlying sex discrimination litigation. Under this approach,
a claim for prejudgment interest would always be deemed
related to the merits claim. The Trout class further argues that
the Consent Decree contains express language reserving the pre-
November 21, 1991, interest issue, and that under a fair reading
of the Consent Decree it was required to litigate that interest
issue. Quoting from the Tenth Circuit’s decision in Johnson v.
City of Tulsa, 489 F.3d 1089 (10th Cir. 2007), that attorneys’
fees were to be awarded for “compensation for reasonable
efforts to preserve the fruits of the decree,” id. at 1111, the Trout
class argues that the Consent Decree expressly contemplated
that a post-judgment determination would be made as to whether
the class would receive pre-November 21,1991, interest, and
that in seeking that interest the class was trying to “preserve the
fruits” of the Consent Decree. Therefore the Trout class claims
that the interest issue was “part and parcel of the central issue in
the case,” i.e., the sex discrimination allegations.
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The Navy contends that the Trout class’s argument that it
should be awarded attorneys’ fees for litigating a post-decree
issue even though it lost that issue on appeal has no merit.
According to the Navy, fees for litigating post-decree issues
have only been awarded in two situations. The first situation is
when the consent decree expressly authorizes the court to award
such fees. Here, the Navy argues, the Consent Decree did not
obligate it to pay such fees regardless of the final outcome of the
issue, but merely reserved the Trout class’s right to seek such
fees. And the Navy further argues that any such fees already
paid were subject to explicit reservations of the right of the
Navy to seek recovery of those fees if it prevailed on the interest
issue. The second situation in which fees have been awarded for
litigating post-decree issues, according to the Navy, is when that
litigation was necessary to protect the relief granted for the
primary claims. But the litigation issue here, argues the Navy,
was not necessary to secure any particular relief granted by the
Consent Decree. Instead, the Navy contends, the litigation on
the interest issue was undertaken in an attempt to gain an
additional remedy for the Trout class. Consequently, contends
the Navy, the district court acted well within its discretion when
it determined that the interest issue was distinct from the sex
discrimination issue.
Relying on the factors set forth in Hensley, the district court
determined that the Trout class’s unsuccessful interest claim was
distinct from its successful sex discrimination claim, Trout, 464
F. Supp. 2d at 32, and we agree. The Trout class and the Navy
disagree as to our standard of review on the issue of the
distinctness of the sex discrimination claim and the interest
claim. The Trout class contends that this is a purely legal
question which we should review de novo, while the Navy
believes that we should review the district judge’s decision for
abuse of discretion, giving great deference to the district judge’s
superior knowledge of the case as a whole. On the present
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record we need not establish a precedent on that subject as the
same result prevails in any event. Even applying the de novo
standard, we agree with the Navy that the claims are distinct.
Litigation of the interest issue was not inextricably intertwined
with the sex discrimination litigation – it was not necessary to
obtain or protect any relief awarded, nor was it necessary to
preserve the integrity of the Consent Decree as a whole. The
district court therefore correctly determined that the issues were
distinct and denied an award of attorneys’ fees for litigation of
the interest issue.
Remaining issues
In its opinion the district court ruled “that in order to restore
the parties to the status quo,” 464 F. Supp. 2d at 34, the Navy
was entitled to interest on the refunded $106,375.45. The Trout
class argues that the district court erred by not considering the
“tax impact” of its refund order on the class’s counsel. As the
Navy points out, however, this argument was not raised during
the proceedings before the district court, and we therefore deem
it waived. We find no merit in the Trout class’s other claims
made in this appeal.
Conclusion
For the reasons stated above, we affirm the judgment of the
district court.