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Irvine Unified School District v. K. G.

United States Court of Appeals, Ninth Circuit

April 13, 2017

Irvine Unified School District, Plaintiff-Appellant,
v.
K. G., an adult student, Defendant-Appellee.

          Argued and Submitted August 1, 2016 Pasadena, California

         Appeal from the United States District Court for the Central District of California, D.C. No. 2:10-cv-01431-JVS-MLG James V. Selna, District Judge, Presiding

          S. Daniel Harbottle (argued), Harbottle Law Group, Irvine, California, for Plaintiff-Appellant.

          Marcy J.K. Tiffany (argued), Tiffany Law Group, Torrence, California, for Defendant-Appellee.

          Sue Ann Salmon Evans and Karl H. Widell, Dannis Woliver Kelley, Long Beach, California, for Amici Curiae California School Boards Association Education Legal Alliance & National School Boards Association.

          Before: Diarmuid F. O'Scannlain, Johnnie B. Rawlinson, and Consuelo M. Callahan, Circuit Judges.

         SUMMARY[*]

         Individuals with Disabilities Education Act / Attorneys' Fees

         The panel affirmed the district court's grant of relief from judgment but vacated its award of attorneys' fees to a student in an action under the Individuals with Disabilities Education Act.

         On remand from a ruling that student K.G.'s school district was the agency responsible for K.G.'s free appropriate public education, K.G. moved for statutory attorneys' fees. The district court denied the motion on the ground that K.G. was not a prevailing party but subsequently granted relief from judgment under Federal Rule of Civil Procedure 60(b) and awarded fees.

         The panel held that the district court did not abuse its discretion in granting relief under Rule 60(b)(1) on the ground of excusable neglect.

         The panel held that K.G. was a prevailing party entitled to attorneys' fees because K.G. achieved the benefit sought, a decision as to which agency was responsible to provide a free appropriate public education. The panel rejected the argument that K.G. could not have benefitted from the litigation because K.G. graduated with a high school diploma months before the district court decided the case. The panel held that K.G.'s victory was not trivial or merely technical.

         The panel held, however, that it was not clear whether the amount of attorneys' fees awarded was reasonable because much of counsel's work took place after K.G.'s graduation. The panel vacated the fee award and remanded for the district court to determine whether the hours billed following K.G.'s graduation were truly the result of advocacy reasonably calculated to advance K.G.'s interests.

         Concurring and dissenting in part, Judge Callahan joined all of the majority opinion except for Section III C, addressing the amount of fees. Judge Callahan wrote that there was no justification in either the IDEA or case law for limiting an award of attorneys' fees to a prevailing party based on whether the student graduated.

          OPINION

          O'SCANNLAIN, Circuit Judge:

         We are asked to decide whether the attorney for a student covered under the Individuals with Disabilities Education Act is entitled to fees for legal work performed after the student's graduation from public school.

         I

         This case originates from a dispute over which California government entity would be responsible for funding the education of K.G., an emotionally disturbed minor from California. Following K.G.'s release from juvenile hall in 2007, the California Department of Education ("the State"), the Orange County Department of Education ("the County"), and the Irvine Unified School District ("the School District") all agreed that K.G. was entitled to a "free appropriate public education" ("FAPE") under the Individuals with Disabilities Education Act ("IDEA"), 20 U.S.C. § 1400(d)(1)(A), but each entity disclaimed responsibility for funding such FAPE. Eventually, the County agreed to fund K.G.'s FAPE, temporarily, until the financially responsible agency could be determined as a matter of law.

         A

         In November 2009, an administrative law judge ("ALJ") within California's Office of Administrative Hearings ruled that the School District was the agency responsible for the FAPE under California law. The District filed a civil action in federal district court challenging the ALJ's decision and naming the State, the County, and K.G. as co-defendants in February of 2010, two months before K.G.'s graduation in April. Proceedings in the district court continued for seven months after K.G.'s graduation and culminated in a decision holding the State responsible for K.G.'s FAPE in November of 2010. The State appealed to this court, and we determined that, as a matter of California law, the School District was responsible for providing K.G.'s FAPE and not the State; we remanded the case for proceedings consistent with our decision. See Irvine Unified Sch. Dist. v. Cal., 506 F.App'x 548, 550 (9th Cir. 2013) (unpublished).

         On remand and before the entry of judgment in district court, K.G. moved for statutory attorneys' fees under IDEA. 20 U.S.C. § 1415(i)(3)(B)(i)(I). K.G., still with the original attorney, requested $232, 625.00 in fees and $1, 286.85 in costs. The district court denied the request for attorneys' fees entirely, holding that K.G. was not a "prevailing party" under IDEA because K.G.'s "victory"-the conclusive determination as to which agency would fund the FAPE-was merely "technical or de minimis." During the course of litigation, K.G. had maintained that the State was responsible for the FAPE rather than the School District, an argument the district court accepted. The district court therefore reasoned that, "given the inherently equitable nature of deciding on attorney fee awards, it seems inappropriate for the District to pay fees accumulated while K.G. was arguing the District's own position." K.G. failed to file a timely appeal.

         B

         With the assistance of a new attorney, K.G. sought relief from the district court's denial of fees under Federal Rule of Civil Procedure 60(b) in February 2014. K.G. argued that the original attorney had "experienced several traumas, including the death of her mother and father-in-law as well as her own life-threatening condition, which triggered an unusually severe bout of depression and anxiety." According to K.G., the denial of substantial attorneys' fees was the final blow, deepening the attorney's depression and "feelings of hopelessness, " rendering her "too incapacitated to file a timely appeal of the Fee Order." The district court found K.G.'s arguments persuasive and granted relief from judgment on May 20, 2014. After receiving such relief, K.G. again moved for attorneys' fees. This time, K.G. sought a total of $282, 038.25, representing $221, 971.35 for work performed by the original attorney and $60, 066.90 for work performed by the new attorney.

         The district court went on to grant in part K.G.'s renewed motion for attorney's fees, mandating that the School District pay $174, 803.65 in fees and costs: the court awarded $126, 657.25 for work performed by K.G.'s original attorney and $48, 146.40 for work performed by K.G.'s new attorney. The School District timely appeals the district court's order.[1]

         II

         The School District contends that the district court erred in granting K.G. relief from its original judgment denying attorneys' fees. We review a district court's grant of relief under Federal Rule of Civil Procedure 60(b) for abuse of discretion. Cal. Dep't of Soc. Servs. v. Leavitt, 523 F.3d 1025, 1031 (9th Cir. 2008).

         A

         The School District first argues that the district court did not apply the correct legal rule in evaluating whether to grant relief. Rule 60(b)(1) provides that a district court "may relieve a party . . . from a final judgment" in cases of "mistake, inadvertence, surprise, or excusable neglect." To determine whether a party's failure to meet a deadline constitutes "excusable neglect" under Rule 60(b)(1), a court "must apply a four-factor equitable test, examining: (1) the danger of prejudice to the opposing party; (2) the length of the delay and its potential impact on the proceedings; (3) the reason for ...


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