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Court of Appeals of New York
October 12, 2004, Argued ; November 23, 2004, Decided
[***281] [**519] [*425] Graffeo, J.
In Farrar v Hobby (506 U.S. 103, 121 L. Ed. 2d 494, 113 S. Ct. 566 ), the United States Supreme Court [****2] concluded that ] a plaintiff in a federal civil rights action who obtains only nominal damages is a "prevailing party" eligible to apply for an attorney's fee award but that an award in those circumstances would rarely be appropriate unless [*426] the litigation served a [**520] [***282] significant public purpose. Certifying four questions to this Court, the United States Court of Appeals for the Second Circuit has asked us to address whether the Farrar standard is applicable to attorney's fees awarded under the New York City Human Rights Law. Because the attorney's fee provision of the New York City Human Rights Law is textually indistinguishable from the federal statutes interpreted in Farrar and we find nothing in the legislative history that directs a different standard, we conclude that counsel fee awards under the City Human Rights Law are subject to the Farrar analysis.
The three plaintiffs in this action, who identify themselves as preoperative transsexuals, commenced a federal action against defendant Toys "R" Us alleging that they were harassed by store employees while shopping in a Toys "R" Us store in December 2000. Plaintiffs contended that defendant's employees violated the New [****3] York City Human Rights Law, a civil rights statute that prohibits discrimination in public accommodation. In the complaint, plaintiffs sought compensatory and actual damages in an amount not less than $ 100,000 for each plaintiff, punitive damages in an amount not less than $ 100,000 for each plaintiff, attorney's fees and injunctive relief.
A nine-day jury trial ensued in June 2002. At trial, plaintiffs' attorney requested substantial compensatory and punitive damages, but did not seek injunctive relief. The jury rendered a verdict in favor of plaintiffs, finding that the conduct of defendant's employees violated plaintiffs' rights under the New York City Human Rights Law, but awarded damages of only $ 1 for each plaintiff.
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3 N.Y.3d 421 *; 821 N.E.2d 519 **; 788 N.Y.S.2d 281 ***; 2004 N.Y. LEXIS 3564 ****
Donna McGrath et al., Respondents, v. Toys "R" Us, Inc., Appellant.
Subsequent History: Remanded by McGrath v. Toys "R" Us, Inc., 409 F.3d 513, 2005 U.S. App. LEXIS 10544 (2d Cir. N.Y., 2005)
Prior History: [****1] Proceeding, pursuant to NY Constitution, article VI, § 3 (b) (9) and Rules of the Court of Appeals (22 NYCRR) § 500.17, to review questions certified to the New York State Court of Appeals by the United States Court of Appeals for the Second Circuit. The following questions were certified by the United States Court of Appeals and accepted by the New York State Court of Appeals: "1. In determining whether an award of attorney's fees is reasonable under New York City Administrative Code § 8-502(f), does New York apply the standards set forth in Farrar v. Hobby, 506 U.S. at 114-15, 113 S. Ct. 566, 121 L. Ed. 2d 494, i.e., (a) that 'the most critical factor . . . is the degree of success,' and (b) that when a party is awarded nominal damages, 'the only reasonable fee is usually no fee at all'?"; "2. If the Farrar standard does not apply, what standard should a court use to determine what constitutes a reasonable fee award for a prevailing party who has received only nominal damages?"; "3. If the Farrar standard applies, does Administrative Code § 8-502(f) authorize a fee award to a prevailing plaintiff who receives only nominal damages but whose lawsuit served a significant public purpose?"; "4. If New York recognizes 'service of a significant public purpose' as a factor warranting an attorney's fee award to a plaintiff recovering only nominal damages, would a plaintiff who is the first to secure a favorable jury verdict on a claim of unlawful discrimination against transsexuals in public accommodation, see N.Y. City Admin. Code § 8-107.4(a), be entitled to a fee award even though the law's prohibition of discrimination against transsexuals in employment, see id. § 8-107.1(a), has previously been recognized?"
McGrath v. Toys "R" Us, Inc., 356 F.3d 246, 2004 U.S. App. LEXIS 1129 (2d Cir. N.Y., 2004)
Disposition: Certified questions 1, 3 and 4 answered in the affirmative; question 2 rendered academic.
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