In the case City of Riverside et al. v. Rivera et al., 1985, a group of Mexican-American residents filed a lawsuit against the city and its police department for alleged civil rights violations during a party raid in which no arrests were made. The plaintiffs won their suit but received only nominal damages ($33,350). However, they also sought attorney's fees under Civil Rights Attorney’s Fees Awards Act of 1976 amounting to over $245,000 based on hours worked by attorneys (lodestar calculation), which was more than seven times the actual damages awarded. The Supreme Court upheld this award in a plurality decision stating that there is not always direct proportionality between the amount of damages awarded and reasonable attorney's fees under federal law. It emphasized that such cases often serve public interest by enforcing important constitutional rights even when monetary compensation is low or non-existent; hence substantial attorney fee awards are justified to encourage skilled counsel to take up these cases.

In the dissenting opinion for City of Riverside v. Rivera, Justice Powell argued that awarding attorney's fees exceeding the damages recovered in a civil rights lawsuit was unreasonable and contrary to Congressional intent. He contended that such an interpretation could potentially encourage frivolous lawsuits and excessive litigation, undermining public confidence in the judicial system. Furthermore, he believed it would disproportionately burden defendants who are often local governments or public officials operating on limited budgets. Instead, he proposed a more balanced approach where courts consider multiple factors including degree of success achieved by plaintiffs when determining reasonable attorney’s fees under Civil Rights Attorney’s Fees Awards Act of 1976.