HRT Enterprises v. City of Detroit: Sixth Circuit Authorizes § 1988 Fees for Related State and Bankruptcy Proceedings but Bars Expert Fees in § 1983 Actions

I. Introduction

The Sixth Circuit’s decision in HRT Enterprises v. City of Detroit, Nos. 24‑1068/1116 (6th Cir. Dec. 22, 2025), is a significant fee‑shifting case at the intersection of civil rights litigation, takings law, and municipal bankruptcy.

The dispute arises from HRT Enterprises’ long-running effort to obtain full “just compensation” for what it claimed was a taking of its property by the City of Detroit, ultimately pursued as a federal civil-rights claim under 42 U.S.C. § 1983. After HRT finally prevailed at trial in federal court, it sought nearly $1.8 million in attorney fees under 42 U.S.C. § 1988, including compensation for work done:

• in state-court takings litigation that was required by then-governing federal ripeness doctrine, and
• in the City’s Chapter 9 bankruptcy case, where HRT fought to preserve its right to full compensation.

The district court agreed that HRT was entitled to fees as the prevailing party but:

• categorically refused to award fees for work done in any “separate” proceeding (state court or bankruptcy), and
• awarded over $40,000 in expert witness fees under § 1988(c).

Both parties appealed. The Sixth Circuit vacated the fee award and remanded, clarifying two important points of law:

1. District courts do have discretion under § 1988 to award fees for work performed in certain related state-court and bankruptcy proceedings when that work is “useful and of a type ordinarily necessary” or “crucial” to vindicating the federal civil-rights claim.
2. Section 1988(c) does not authorize expert witness fees in § 1983 actions; expert fee-shifting under that provision is limited to actions enforcing 42 U.S.C. §§ 1981 and 1981a.

This commentary analyzes the opinion’s reasoning, its reliance on Supreme Court and Sixth Circuit precedents, and its practical impact on civil-rights fee litigation, takings claims, and bankruptcy practice.

II. Factual and Procedural Background

A. The Underlying Takings Litigation

Although the fee opinion does not rehash the full merits, the procedural history matters for understanding the fee issues:

• 2005 – State-court verdict. HRT brought a takings claim against Detroit in Michigan state court and lost; a jury found for the City.
• 2008 – First federal lawsuit (unripe takings claim). HRT then filed a § 1983 lawsuit in federal court alleging a post‑2005 taking. At the time, Williamson County Regional Planning Commission v. Hamilton Bank, 473 U.S. 172 (1985), required property owners to seek compensation in state court before a federal takings claim would be ripe. The federal district court dismissed HRT’s suit without prejudice for failure to exhaust state remedies.
• 2009–2012 – Required state-court takings lawsuit. Following the federal dismissal, HRT returned to state court. That case was dismissed on claim preclusion grounds (res judicata), and the Michigan Court of Appeals affirmed in a 2012 decision (HRT Enters. v. City of Detroit, No. 304057, 2012 WL 3055221).
• 2012 – Present § 1983 action filed. Once state courts had denied compensation, HRT filed this federal § 1983 action in August 2012. Under the then‑existing Williamson County regime, the federal claim was now ripe.
• 2013 – Detroit’s bankruptcy. In July 2013, Detroit filed for Chapter 9 municipal bankruptcy. The automatic stay halted the federal takings suit. HRT filed a $7 million proof of claim in the bankruptcy case.
• Bankruptcy plan and objection. Detroit’s proposed plan treated HRT and similar claimants as unsecured creditors—entitled only to a pro‑rata portion of their claims, with the remainder discharged. HRT’s counsel (jointly representing HRT and two other creditors) objected, arguing that:
  • the Fifth Amendment’s Takings Clause requires full just compensation, and
  • the Takings Clause has priority over the Bankruptcy Clause and Chapter 9 provisions, so the City could not confirm a plan that discharged part of a takings judgment.
  The bankruptcy court accepted this argument in substance: it excepted HRT’s takings claim from discharge under 11 U.S.C. § 944(c)(1), allowing HRT to return to district court and litigate for full compensation.
• 2015–2023 – Reopened federal case and verdict. The district court reopened the § 1983 action in January 2015. After two jury trials, judgment was entered for HRT in September 2023. The Sixth Circuit had previously affirmed that merits judgment.

Judge Thapar (in a footnote) noted that he would have reversed the jury’s verdict altogether on res judicata grounds, which would have stripped HRT of “prevailing party” status and thus its entitlement to § 1988 fees. But because the panel’s majority had already affirmed the verdict, he joined the fee opinion in full.

B. The Fee Petition and District Court’s Ruling

As the prevailing party, HRT moved for attorney fees under 42 U.S.C. § 1988(b), seeking $1,796,626.87 in fees for work performed from 2009 through the trial and then an additional $72,763.58 for post‑verdict work.

Key features of the fee application:

• Time records. HRT submitted billing records from principal counsel Mark Demorest and co‑counsel Neil Strefling. The records were far from ideal:
  • Demorest’s records were grouped into four categories (federal case + bankruptcy; 2009 state‑court lawsuit; state‑court appeal; and a sewer dispute), but many entries commingled work for:
    • this § 1983 case,
    • the City’s bankruptcy,
    • a separate “sewer dispute” with Detroit, and
    • “blight ticket” proceedings with the City.
  • Blight-ticket work was also commingled with entries for the 2009 state-court lawsuit.
  • Strefling’s entries had very vague descriptions (“Research, calls,” “Conf w/KT,” “Work on file”).
• The City’s objections. Detroit argued that:
  • the records were too deficient to support the nearly $1.8 million request;
  • a reasonable fee would be no more than $300,000 (1,200 hours at $250/hr) or, alternatively, $500,000;
  • work related to other matters (sewer dispute, blight tickets, separate state litigation, and the bankruptcy) should not be compensable; and
  • § 1988 did not authorize expert witness fees in this § 1983 case.

The district court tried to salvage the fee request but expressed:

“grave doubts about the propriety of the extremely large fee sought in this case,”

citing:

• “poor descriptions” for numerous entries, and
• “commingled” hours spent on “entirely separate matters, for which [HRT] have no legal grounds for seeking an award of fees.”

Relying on its understanding of Sixth Circuit precedent (especially Binta B. ex rel. S.A. v. Gordon, 710 F.3d 608 (6th Cir. 2013)), the district court concluded it could not, as a matter of law, award fees for work in:

• the 2009 state-court takings proceedings, or
• the City’s bankruptcy case.

To address what it called the “pervasive corruption” of the billing records—especially the inclusion of time for those supposedly non-compensable matters—the district court:

• Reduced pre‑verdict hours by 33%. HRT claimed 3,169 pre‑verdict hours. Applying a blanket 33% reduction yielded 2,091 hours.
• Added post‑verdict hours. Including unchallenged post‑verdict work, the court arrived at 2,259.6 total hours.
• Applied an “average” hourly rate of $300. Because the records did not allow the court to reliably allocate hours among specific lawyers, it used an overall market-average rate of $300/hr, derived from a state bar survey, instead of attorney-specific rates.
• Calculated the lodestar. 2,259.6 hours × $300/hr = $677,880.
• Added expert witness fees and expenses. The court then awarded $40,906.25 in expert fees under § 1988(c), plus other expenses, for a total award of $720,486.25.

Both sides appealed. HRT contended that the court wrongly disallowed fees for state-court and bankruptcy work and undervalued its efforts; the City contended that even the reduced award was excessive and that expert fees were legally unavailable.

III. Summary of the Sixth Circuit’s Holding

The Sixth Circuit (Judge Griffin, joined by Judges Thapar and Mathis) vacated the fee award and remanded for recalculation, holding:

1. Discretion to award fees for related state and bankruptcy proceedings.
   The district court misread Sixth Circuit and Supreme Court precedents in concluding that it had no discretion to award fees for work performed:
   • in the 2009 state-court takings case required by Williamson County, and
   • in the City’s Chapter 9 bankruptcy proceedings that were “crucial” to preserving HRT’s right to full compensation.
   Under Webb v. Board of Education, 471 U.S. 234 (1985), New York Gaslight Club, Inc. v. Carey, 447 U.S. 54 (1980), and Pennsylvania v. Delaware Valley Citizens’ Council for Clean Air, 478 U.S. 546 (1986), such work in “separate but related” proceedings may be compensable when it is both:
   • “useful and of a type ordinarily necessary to advance the civil rights litigation,” and/or
   • “crucial to the vindication” of the prevailing party’s rights.
2. No expert fee-shifting under § 1988(c) in § 1983 actions.
   The district court erred in awarding $40,906.25 in expert witness fees. Under:
   • Crawford Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437 (1987), and
   • West Virginia University Hospitals, Inc. v. Casey, 499 U.S. 83 (1991),
   courts may not award expert witness fees beyond the limits of 28 U.S.C. § 1821(b) absent “explicit statutory authority.” Section 1988(c) provides such authority only for “any action or proceeding to enforce a provision of section 1981 or 1981a”; it does not mention § 1983. Applying ordinary textual canons (including expressio unius est exclusio alterius), the court held that expert fee-shifting under § 1988(c) does not extend to § 1983 cases.
3. Remand without resolving remaining disputes.
   Because these legal errors infected the lodestar calculation, the Sixth Circuit vacated the fee award and remanded. It expressly declined to address other issues (e.g., the reasonableness of the number of hours or the $300 rate), leaving those determinations to the district court in light of the corrected legal standards.

IV. Detailed Analysis

A. The General Fee-Shifting Framework Under § 1988

Section 1988(b) authorizes courts, in their discretion, to award a “reasonable attorney’s fee” to the prevailing party in an action enforcing various civil-rights statutes, including § 1983.

The basic methodology is the familiar “lodestar” approach:

• Step 1 – Reasonable hours. Determine the reasonable number of hours expended on the litigation.
• Step 2 – Reasonable rate. Determine a reasonable hourly rate for the services provided.
• Step 3 – Lodestar & adjustments. Multiply hours × rate to obtain a lodestar amount, which is “strongly presumed” to represent a reasonable fee (see, e.g., Murphy v. Smith, 583 U.S. 220, 227 (2018)), subject to possible upward or downward adjustments in extraordinary circumstances.

The Supreme Court in Hensley v. Eckerhart, 461 U.S. 424, 433 (1983), requires the fee applicant to submit documentation “supporting the hours worked and rates claimed.” Where documentation is inadequate, “the district court may reduce the award accordingly.”

The Sixth Circuit in Freed v. Thomas, 137 F.4th 552, 560–63 (6th Cir. 2025), reaffirmed this lodestar approach and emphasized that misapplication of the governing legal standards constitutes an abuse of discretion warranting vacatur and remand. That is precisely what the court found in HRT Enterprises.

B. Fees for Work in “Separate” Proceedings: The Webb/Delaware Valley Exception

1. The General Rule and Binta B.

The starting point is the general rule that fees under § 1988 are ordinarily limited to work done in the case for which fees are sought. In Binta B. ex rel. S.A. v. Gordon, 710 F.3d 608 (6th Cir. 2013), the Sixth Circuit stated that fees for “a completely separate case” are “generally unrecoverable” under § 1988 (id. at 631).

But, as Binta B. itself recognized—and as the panel emphasized here—that general rule is subject to a critical exception established by the Supreme Court in:

• Webb v. Board of Education of Dyer County, 471 U.S. 234 (1985), and
• Pennsylvania v. Delaware Valley Citizens’ Council for Clean Air, 478 U.S. 546 (1986).

The district court in HRT’s case treated Binta B. as if it established a categorical bar on fees for any work performed in “proceedings separate from the litigation before the district court.” The Sixth Circuit held that this was legal error: the district court ignored the Webb/Delaware Valley exception that Binta B. itself acknowledged.

2. Webb and Carey: “Useful and Ordinarily Necessary” Related Proceedings

In Webb, a teacher who prevailed on a First Amendment claim under § 1983 sought fees for work he had done in related administrative proceedings before filing suit. The Supreme Court articulated the standard:

“[A] district court may award attorney’s fees under § 1988 for time spent on administrative proceedings to the extent that the work product from those proceedings was both useful and of a type ordinarily necessary to advance the civil rights litigation to the stage it reached before settlement.” (471 U.S. at 243–44.)

Webb highlighted New York Gaslight Club, Inc. v. Carey, 447 U.S. 54 (1980), as an example. Carey involved Title VII, which requires complainants to first resort to state or local administrative remedies before filing a federal action. The Court held that a prevailing Title VII plaintiff could recover fees for work performed in state proceedings because:

• those proceedings were a mandatory prerequisite to a federal lawsuit, and
• Congress intended the federal fee provision to cover the entire enforcement process, including required state-level components.

Although Carey interpreted a different fee-shifting statute (42 U.S.C. § 2000e‑5(k)), the Supreme Court in both Webb and Delaware Valley noted the common purpose of fee provisions in civil-rights statutes and applied parallel reasoning to § 1988.

3. Delaware Valley: “Crucial to the Vindication” of Rights

In Delaware Valley, an environmental group sought fees for work done in various regulatory and administrative proceedings to enforce a Clean Air Act consent decree. The Supreme Court upheld the award, stating that awarding fees for such work was:

“entirely proper and well within the zone of discretion afforded [to district courts]” where the separate proceedings were “crucial to the vindication of [the prevailing party’s] rights.” (478 U.S. at 561.)

Together, Webb, Carey, and Delaware Valley create an exception to the “no fees for separate cases” rule:

• If a separate proceeding is legally required to ripen or pursue the federal claim (as in Carey), or
• If participation in that proceeding is crucial to vindicating the rights protected by the federal claim (as in Delaware Valley),

then a district court may, in its discretion, treat that work as part of the civil-rights “action or proceeding” for which § 1988 allows fee-shifting.

4. Application to HRT’s State-Court Takings Proceedings

When HRT first filed its federal takings claim in 2008, the Supreme Court’s decision in Williamson County Regional Planning Commission v. Hamilton Bank, 473 U.S. 172 (1985), governed. Under Williamson County, a property owner whose property had been taken by a local government could not bring a federal takings claim under § 1983 until:

1. the government had reached a final decision on the use of the property, and
2. the owner had been denied “just compensation” under available state procedures.

In other words, before 2019, a federal takings claim was not ripe until the plaintiff had gone to state court and been denied compensation under state law. That rule was later overruled in Knick v. Township of Scott, 588 U.S. 180 (2019), but it controlled at the time of HRT’s actions.

Thus, when the district court dismissed HRT’s 2008 federal suit as unripe, HRT had no choice but to return to state court in 2009 to seek just compensation. Only after the Michigan courts denied relief did HRT file the present § 1983 suit in 2012.

The Sixth Circuit analogized this sequence to Carey:

• Just as Title VII required the plaintiff in Carey to first pursue state administrative remedies, Williamson County required HRT to first pursue state judicial remedies before suing under § 1983.
• Those state-court takings proceedings were therefore “not only useful and of a type ordinarily necessary to advance HRT’s federal takings claim—they were required under law.”

On that basis, the court held that the district court had discretion under § 1988 to award fees for HRT’s counsel’s work in the 2009 state-court takings proceedings. The problem was not that awarding such fees was forbidden; rather, the problem below was that the district court incorrectly believed it was forbidden as a matter of law and refused to even consider them.

5. Application to the City’s Bankruptcy Proceedings

The analysis of the Chapter 9 bankruptcy work rests more squarely on Delaware Valley’s “crucial to the vindication” standard.

In Detroit’s Chapter 9 case, the City proposed a plan that would treat HRT’s takings claim as a general unsecured debt, paying only a pro‑rata fraction and discharging the remainder. For HRT, that was incompatible with the Fifth Amendment’s guarantee of “just compensation”:

• Under Knick and Jacobs v. United States, 290 U.S. 13, 16 (1933), a property owner has an “irrevocable right” to recover full just compensation; the Constitution guarantees recovery of the full amount, not inadequate compensation.
• If HRT had accepted pro‑rata payment and the bankruptcy discharge, it would likely have forfeited the right to recover anything more in federal court.

To prevent this, HRT filed a formal objection to Detroit’s plan, arguing that:

• the Takings Clause trumps the Bankruptcy Clause (and thus Chapter 9 to the extent of any conflict); and
• a plan cannot lawfully discharge a takings claim without full payment of just compensation.

The bankruptcy court evidently agreed, excepting HRT’s takings claim from discharge under 11 U.S.C. § 944(c)(1). That ruling preserved HRT’s ability to continue the federal case and to seek the full amount of just compensation at trial.

The Sixth Circuit characterized HRT’s participation in the bankruptcy as:

“crucial to the vindication of its Fifth Amendment right to full compensation.” (citing Delaware Valley, 478 U.S. at 561.)

If HRT had not objected in bankruptcy, it “would have certainly received less than full compensation in the bankruptcy and would not have been entitled to anything more in district court.” Thus:

• the bankruptcy work was not merely helpful or tangential; it was essential to preserving the very right that the § 1983 action sought to enforce; and
• under Delaware Valley, the district court had discretion to award fees for that work as part of the overall civil-rights enforcement effort.

The Sixth Circuit added an important limiting caution: HRT’s counsel jointly represented two other creditors in the bankruptcy. On remand, the district court should compensate only work performed to vindicate HRT’s Fifth Amendment rights, not those of other clients.

6. Crest Street and Machle: Who Can Award These Fees?

A further doctrinal piece is North Carolina Department of Transportation v. Crest Street Community Council, Inc., 479 U.S. 6 (1986). There, the Supreme Court held:

“[O]nly a court in an action to enforce one of the civil rights laws listed in § 1988 may award attorney’s fees.” (479 U.S. at 15.)

That is, § 1988 does not provide a free-standing cause of action; it is simply a fee provision tethered to an underlying enforcement action (like a § 1983 suit). Consequently:

• State courts adjudicating state-law takings claims, and
• Bankruptcy courts adjudicating proofs of claim

generally cannot award § 1988 fees because those proceedings are not themselves § 1983 (or similar) civil-rights actions. Only the federal district court adjudicating the § 1983 case may do so. The Sixth Circuit previously applied this principle in Children’s Center for Developmental Enrichment v. Machle, 612 F.3d 518, 522–23 (6th Cir. 2010).

That is why HRT sought fees for its state and bankruptcy work in the federal § 1983 action and could not have obtained them directly from those other tribunals. The Sixth Circuit underscored that reality in justifying why the district court had to consider the request rather than dismissing it on the ground that another court should have awarded those fees.

7. Effect of the Error and the Remand

The Sixth Circuit did not hold that HRT must be awarded every dollar it requested for the state-court and bankruptcy work. Instead, it held that:

• The district court abused its discretion by adopting a legal rule that those categories were categorically ineligible for fees.
• On remand, the court must:
  • recognize its discretion under Webb, Carey, and Delaware Valley to award some fees for work in those proceedings; and
  • then exercise that discretion by assessing which tasks were:
    • “useful and of a type ordinarily necessary” or “crucial” to vindicating HRT’s rights;
    • reasonable in amount; and
    • properly attributable to HRT (and not to other clients or unrelated disputes such as the sewer matter and blight tickets, which HRT itself did not challenge on appeal).

The district court may still apply reductions for poor record-keeping or commingling, but it must do so under the correct understanding that state-court and bankruptcy work can, in principle, be compensable under § 1988.

C. Expert Witness Fees Under § 1988(c) in § 1983 Cases

1. The Default Rule: § 1821(b) and Crawford Fitting

By default, reimbursement of witness fees in federal court is governed by 28 U.S.C. § 1821(b), which provides a daily attendance fee (currently $40 per day) plus certain travel-related expenses. In Crawford Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437 (1987), the Supreme Court held:

“[W]hen a prevailing party seeks reimbursement for fees paid to its own expert witnesses, a federal court is bound by the limit of § 1821(b), absent contract or explicit statutory authority to the contrary.” (482 U.S. at 439.)

Therefore, unless Congress has expressly authorized broader expert fee-shifting in a particular statute, courts cannot order the losing party to pay more than the § 1821(b) amounts for expert services—even in civil-rights cases.

2. Casey and the Meaning of “Attorney’s Fees”

In West Virginia University Hospitals, Inc. v. Casey, 499 U.S. 83 (1991), the Court considered whether a statutory authorization to award “a reasonable attorney’s fee” includes expert witness fees. The Court held that it does not:

• “Attorney’s fees” and “expert fees” are distinct categories in statutory usage.
• Absent explicit language, a fee-shifting provision for “attorney’s fees” does not encompass expert costs beyond the § 1821(b) baseline.

Casey interpreted § 1988(b) itself and concluded that it did not authorize expert fee-shifting.

3. Congress’s Response: Adding § 1988(c)

In direct response to Casey, Congress enacted § 1988(c) as part of the Civil Rights Act of 1991. That subsection states:

“In awarding an attorney’s fee under subsection (b) in any action or proceeding to enforce a provision of section 1981 or 1981a, the court, in its discretion, may include expert fees as part of the attorney’s fee.”

Two features are crucial:

• It explicitly authorizes expert fee-shifting, but only “as part of the attorney’s fee.”
• It limits that authorization to actions or proceedings “to enforce a provision of section 1981 or 1981a.”

Congress amended § 1988(b) to add “1981a” to the list of fee‑shifting statutes but did not similarly amend it to mention “expert fees” for § 1983.

4. Sixth Circuit’s Textual Analysis in HRT Enterprises

In HRT’s case, the district court concluded that § 1988(c) allowed it to award expert witness fees in this § 1983 action. The Sixth Circuit disagreed, emphasizing the plain language of § 1988(c):

• Express limitation. The statute speaks only to “any action or proceeding to enforce a provision of section 1981 or 1981a.”
• Omission of § 1983. It says nothing about § 1983, even though § 1983 is prominently listed in § 1988(b) as a statute whose enforcement actions can trigger attorney-fee awards.

The court used two key interpretive principles:

1. Respecting statutory text.
   Citing Casey and Crawford Fitting, the court noted that Congress must provide “explicit statutory authority” to override the § 1821(b) caps. When Congress wanted to provide that authority, it did so clearly for § 1981 and § 1981a—but not for § 1983.
2. Expressio unius est exclusio alterius.
   As the Sixth Circuit put it, “the expression of one thing is the exclusion of another.” Because § 1988(c) expressly mentions § 1981 and § 1981a, it is inferred to exclude expert fee-shifting for other statutes listed in § 1988(b), including § 1983.

Therefore, the court held that the district court “abused its discretion when it awarded expert witness fees under § 1988(c) in this § 1983 action.” On remand, the only expert compensation potentially available will be:

• the modest statutory witness fees under § 1821(b), or
• any amounts allowable as ordinary “costs” under other statutes or rules (though the court expressly noted that such “costs” were not at issue here, citing Waldo v. Consumers Energy Co., 726 F.3d 802, 827 (6th Cir. 2013)).

D. The Takings Clause, Bankruptcy, and the Priority of Constitutional Rights

Although the opinion’s holding is limited to fees, it rests on a substantive constitutional premise that has broader importance: takings claimants’ rights to full just compensation cannot be casually compromised in municipal bankruptcy.

HRT’s argument in bankruptcy—and the bankruptcy court’s eventual ruling—presuppose that:

• the Fifth Amendment’s Takings Clause (requiring just compensation when private property is taken for public use) is a substantive constitutional constraint on state and local governments, and
• the Bankruptcy Clause and Chapter 9 cannot be interpreted to permit a city to discharge a takings obligation for less than full just compensation.

The Sixth Circuit’s willingness to treat the bankruptcy objection as “crucial” to vindicating HRT’s rights confirms that:

• a takings claim is not merely an unsecured contractual debt; it is a constitutional entitlement,
• creditors with takings claims may need to actively protect those rights in Chapter 9 proceedings, and
• time spent doing so can, in appropriate circumstances, be compensable as part of a § 1983 takings enforcement effort under § 1988.

While the opinion does not establish a general doctrine on the hierarchy between the Takings Clause and the Bankruptcy Clause, it illustrates in concrete terms how courts may treat takings liabilities as constitutionally protected obligations that survive municipal restructuring.

E. Billing Practices and the Lodestar After HRT

The Sixth Circuit did not disturb the district court’s general approach of:

• scrutinizing billing records carefully,
• reducing hours where documentation was inadequate or commingled with unrelated work, and
• using an averaged hourly rate where attorney-specific allocations were impossible.

The only legal error identified was the categorical elimination of state-court and bankruptcy work. The court expressly declined to review the:

• overall percentage reduction,
• total hours allowed, or
• chosen hourly rate of $300.

On remand, the district court retains broad discretion to:

• apply targeted or across-the-board reductions to address vague descriptions (“Research, calls,” “Work on file”),
• exclude time for unrelated matters (sewer dispute, blight tickets), and
• award fees only where the documentation provides a “reasonable basis” to support them.

For practitioners, the case is a cautionary tale: even when the law allows recovery for related proceedings, poor timekeeping can drastically diminish the actual award.

V. Complex Concepts Simplified

1. “Prevailing Party” and § 1988 Fee Awards

A party is typically a “prevailing party” if it:

• obtains a judgment on the merits, or
• secures a court-ordered change in the legal relationship between the parties (e.g., a consent decree).

Here, HRT won a jury verdict and final judgment on its § 1983 takings claim. That made it a prevailing party eligible for § 1988 fees. Judge Thapar’s footnote signals that this eligibility is contingent on the merits: if the case had been dismissed on res judicata grounds, there would be no prevailing party and no fee entitlement.

2. The Lodestar Method

The “lodestar” is simply:

reasonable hours × reasonable hourly rate.

Examples:

• If an attorney reasonably expends 1,000 hours at a reasonable market rate of $300/hr, the lodestar is $300,000.
• Courts often then consider factors like:
  • the results obtained,
  • the complexity of the case,
  • whether the plaintiff achieved complete or partial success,
  in deciding whether the lodestar should be adjusted (though adjustments are relatively rare).

In HRT’s case, the district court set the lodestar at $677,880 by multiplying 2,259.6 hours by a $300 rate, before improperly adding expert fees.

3. Takings Claims and Just Compensation

The Fifth Amendment’s Takings Clause, applicable to states and cities through the Fourteenth Amendment, provides:

“[N]or shall private property be taken for public use, without just compensation.”

A “takings” claim can arise from:

• formal eminent domain proceedings (direct condemnation), or
• government actions that effectively take or destroy property rights without formal condemnation (inverse condemnation or regulatory takings).

In either scenario, the Constitution guarantees the property owner an “irrevocable right” to fair market value compensation at the time of the taking (see Jacobs, 290 U.S. at 16; Knick, 588 U.S. at 190, 192).

4. Williamson County Ripeness and Knick

Before 2019, Williamson County required takings plaintiffs to first:

1. obtain a final decision by the relevant agency, and
2. seek and be denied just compensation through available state procedures,

before filing a federal § 1983 claim. This often forced plaintiffs into a “state court trap,” where their federal claim was later barred by res judicata based on the state judgment.

In Knick v. Township of Scott, 588 U.S. 180 (2019), the Court overruled the second prong of Williamson County, holding that a property owner “may bring a Fifth Amendment claim under § 1983 at the time of the taking, regardless of any post‑taking remedies that may be available to the property owner” in state court (id. at 184).

HRT’s state-court litigation occurred before Knick, when the now-overruled ripeness rule still applied. That historical context is why the Sixth Circuit treated the state-court proceedings as mandatory and thus fee-eligible under the Carey analogy.

5. Res Judicata (Claim Preclusion)

Res judicata (claim preclusion) prevents a party from re‑litigating:

• the same claim or cause of action,
• between the same parties,
• after a final judgment on the merits by a court of competent jurisdiction.

HRT’s 2009 state-court case was dismissed on claim preclusion grounds—presumably because the state courts found that the issues or claims overlapped with those litigated in 2005. Judge Thapar’s footnote indicates he would have held that this res judicata ruling also barred the subsequent § 1983 federal suit, revoking HRT’s prevailing-party status.

6. Automatic Stay, Proof of Claim, and § 944(c)(1) in Chapter 9

• Automatic stay. When a debtor (including a municipality) files for bankruptcy, 11 U.S.C. § 362 automatically halts most litigation and enforcement actions against it, including pending federal lawsuits.
• Proof of claim. Creditors must file proofs of claim in the bankruptcy case to assert their entitlement to payment.
• Plan of adjustment (Chapter 9). The city proposes a plan describing how it will treat various classes of claims; the bankruptcy court confirms the plan if statutory criteria are met.
• § 944(c)(1) exception. Certain debts can be excepted from discharge, meaning they survive the plan. Here, HRT’s takings claim was excepted under § 944(c)(1), preserving its right to pursue full compensation in district court.

7. § 1988 Fees vs. Expert Witness Fees Under § 1821(b)

It is important to distinguish:

• Attorney’s fees under § 1988(b): a court may order the losing party to pay the prevailing party’s reasonable attorney’s fees (subject to statutory limits and discretion).
• Expert witness fees:
  • Absent explicit statutory authority (e.g., Title VII’s § 2000e‑5(k), § 1988(c) for §§ 1981/1981a, certain ADA and ADEA provisions), courts are limited by § 1821(b) to $40 per day plus travel expenses for experts.
  • In § 1983 cases, § 1988(c) does not provide that explicit authority.

Thus, after HRT Enterprises, it is clear in the Sixth Circuit that § 1983 plaintiffs cannot recover substantial expert fees under § 1988(c); they must either absorb them, shift them by contract, or rely on other statutory fee provisions if available.

VI. Implications and Future Impact

A. For Civil-Rights Litigants and Counsel

The decision has several practical consequences for civil-rights litigation under § 1983:

• Expanded fee eligibility for related proceedings. Lawyers can argue that time spent in:
  • mandatory state administrative or judicial proceedings, and
  • bankruptcy or other collateral forums where the client’s federal rights are at serious risk,
  is compensable under § 1988 when that work is “useful and ordinarily necessary” or “crucial” to the success of the federal case.
• No categorical bar. District courts in the Sixth Circuit may no longer categorically deny fee claims for separate but related proceedings solely because they occurred in another tribunal. They must analyze whether the specific work meets the Webb/Delaware Valley tests.
• Strategic participation in collateral forums. Civil-rights counsel should:
  • carefully assess when participation in parallel state, administrative, or bankruptcy proceedings is necessary to preserve their client’s federal rights; and
  • document such work in a way that clearly links it to the federal claim, to support a § 1988 fee request later.

B. For Takings and Municipal Bankruptcy Practice

In the specific context of takings and municipal bankruptcy:

• Takings claimants must be proactive in bankruptcy. Property owners with takings claims against insolvent municipalities cannot assume that those rights will be automatically respected. They may need to:
  • file proofs of claim,
  • object to plans treating takings claims as unsecured debts, and
  • assert constitutional arguments to preserve their rights.
• Fee recovery for bankruptcy participation. If such bankruptcy participation is essential to preserving a § 1983 takings claim, HRT Enterprises supports the argument that related fees can be shifted under § 1988, subject to reasonableness and proper documentation.
• Constitutional constraints on Chapter 9 plans. While not a merits holding, the case reinforces the view that Chapter 9 plans must respect constitutional guarantees, including the Takings Clause, and cannot freely compromise takings obligations as unsecured debts.

C. For Fee Litigation and Billing Practices

The decision underscores best practices in fee petitions:

• Segregate time by matter and forum. Counsel should:
  • keep separate billing codes or files for each case or proceeding,
  • avoid commingling unrelated work (e.g., separate disputes, different clients) in the same entry, and
  • make clear which hours relate to the federal claim and which to related proceedings.
• Provide adequate descriptions. Vague entries (“Research,” “Work on file”) invite across‑the‑board reductions. Descriptions should:
  • identify the specific issue, motion, or proceeding involved, and
  • show how the work advanced the client’s federal rights.
• Avoid double billing across clients. Where counsel represent multiple clients in a related proceeding, time must be carefully apportioned. HRT’s case makes clear that only the share of work attributable to the § 1983 plaintiff can be recovered.

D. For Expert Witness Engagement in § 1983 Cases

By confirming that § 1988(c) does not authorize expert fees in § 1983 actions, the Sixth Circuit’s decision affects litigation planning:

• Budgeting and risk. Plaintiffs and their counsel must assume that expert costs will not be fully recoverable from the defendant in § 1983-only cases, beyond the minimal statutory witness fee.
• Use of alternative statutory hooks. Where possible, plaintiffs may pair § 1983 claims with other statutory claims that do provide expert fee-shifting (e.g., Title VII, ADA, § 1981/1981a) to expand the pool of recoverable expert costs.
• Contractual arrangements. Counsel may need to address expert costs explicitly in retainer agreements, including:
  • who bears the initial costs,
  • whether costs will be reimbursed from any recovery, and
  • how to handle cases where the damages recovered are modest compared to expert expenditures.

VII. Conclusion

HRT Enterprises v. City of Detroit is an important clarification of civil-rights fee law in the Sixth Circuit.

First, it reaffirms and applies the Supreme Court’s Webb/Carey/Delaware Valley line: time spent in separate but related state and bankruptcy proceedings can be compensable under § 1988 where those proceedings are legally required or crucial to vindicating the plaintiff’s federal rights. District courts may not adopt categorical rules denying such fees; they must instead exercise case-specific discretion.

Second, it confirms a strict, textual reading of § 1988(c): expert fees are explicitly shiftable only in actions enforcing §§ 1981 and 1981a, not in § 1983 cases. In the absence of another specific statutory authorization, § 1821(b)’s modest caps govern expert witness compensation.

Beyond these holdings, the decision highlights the intersection of takings law and municipal bankruptcy, underscores the evidentiary and strategic importance of related proceedings in civil-rights enforcement, and provides practical guidance on fee petitions and billing practices. For litigants and courts alike, it reinforces a central theme of fee-shifting doctrine: careful attention to statutory text, to the functional role of related proceedings in enforcing federal rights, and to the quality and clarity of time records that underpin fee awards.