Thursday, September 13, 2007, 4:30 PM

Appeals Court Asks Judge to Reconsider $150,000 Award of Attorneys' Fees on Lost Tips of $1.26

Although it is common to have "prevailing party" attorneys' fees set at an amount proportional to the damages awarded to the plaintiff, a recent Massachusetts decision demonstrates that this is not an inflexible rule. How about a fee 120,000 times the plaintiff's recovery? A state appeals court ruling questions whether this is a bit inordinate, as the discussion below shows.

A recent decision demonstrates that claims under the Massachusetts Wage Act can prove costly to employers even in victory. In Killeen v. Westban Hotel Venture, the plaintiff, a hotel banquet server, alleged that the hotel violated the state tip pooling statute by giving a portion of gratuities to “banquet captains.” Although the trial court found that banquet captains did in fact provide service and were entitled to share in gratuities, it concluded that the hotel’s practice of allowing the banquet captains to collect a full share of the service charges violated the “proportionality” provision of the tip pooling statute. The plaintiff claimed damages of up to $127,000, but, after a trial, only proved damages in the amount of $1.26. The trial judge mistakenly believed that the statute required this amount to be trebled and entered judgment in the amount of $3.78. Despite that the plaintiff had only established actual damages of a little more than a dollar, the trial court also awarded her attorneys’ fees and costs in excess of $150,000.

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