The tear-gas grenades flew into Jennie and Santos Rivera's Riverside, Calif., house just before midnight on a steamy August night in 1975, putting a swift end to their party.

Police arrested dozens of the 50 guests and used grease pencils to write "409" -- the code for "failure to disperse" -- on their foreheads. The police helicopter pilot overhead sang into a loudspeaker: "The party's over, it's time to call it a day."

A decade later, that party has evolved into a major dispute before the U.S. Supreme Court involving not the police actions, but the actions of the lawyers who subsequently became involved in the case. At stake, some observers said, may be the future of all civil rights litigation.

Charges were dropped against the Riverside party-goers. But eight sued the city and the police for violating their civil rights and for false imprisonment. Five years later, a jury awarded them $33,350 in damages.

Their lawyers then asked for fees under a 1976 law that allows winning attorneys in civil rights cases to collect "reasonable" fees from the losers. The bill: $245,000.

The city said the bill was outrageous; the lawyers should not get seven times what the clients' won. The city refused to pay.

The Supreme Court will hear arguments Monday over what are "reasonable" fees in civil rights cases and whether those fees should be proportional to the amount won.

The stakes in Rivera v. Riverside are high.

Civil rights groups, backed by the Equal Employment Opportunity Commission, said the case could produce one of the most important civil rights rulings of recent years. If the court agrees with the city, they said, the result would be devastating for civil rights enforcement.

Civil rights cases are not like medical malpractice or accident cases with multimillion-dollar jury awards, these groups said. Lawyers are always available to handle such claims -- and get one-third of the award.

Discrimination cases, however, often involve insignificant amounts of money, but are important to constitutional rights. The groups argued that Congress understood the difference between the two types of cases when it passed the 1976 fees act. The idea, they said, was to make sure that lawyers would be willing to take these cases.

If the Supreme Court agrees with the city, the EEOC argued in a memo urging the solicitor general's office to support the Riveras' lawyers, "this would defeat the purpose of the fee-shifting statutes to encourage full enforcement of civil rights law . . . [and] frustrate Congress's intent."

But the Justice Department, following a longstanding policy to limit lawyers' fees, filed a brief supporting the city. A coalition of business organizations also supports Riverside.

The fee award must be adequate, the administration argued, to "attract competent counsel" to handle "meritorious" suits. "On the other hand, the award must not be so generous as to unjustly enrich a plaintiff's attorney at the defendant's expense."

The judge hearing the case agreed that the hours spent and the hourly fees -- $125 an hour -- were "reasonable." Her ruling was twice upheld by a federal appeals court.

Those and similar rulings nationwide, the city's attorney, Jonathan Kotler, said, have created a "growth industry" of lawyers who are filing marginal suits, overlitigating cases and raiding "the coffers of defendant municipalities, states and other government agencies."

The case, the administration said, did not result in a change of policy by the city or serve some broad goal. It should be viewed more as a simple, everyday suit for damages. As such, fees equal to or greater than the damages awarded are "presumptively unreasonable," the administration said.

In cases such as this one, the administration told the court, "the prospect of recovering $11,000 for representing [the Riveras and their guests]," assuming a typical one-third contingency-fee rate, "is likely to attract a substantial number of attorneys."

That argument draws derisive hoots from civil rights lawyers. The NAACP Legal Defense and Educational Fund Inc., in its brief, said that view "can only be described as a fantasy. It certainly has no relation to the real world of civil rights" enforcement.

Gerald P. Lopez, one of the Riveras' lawyers, said in an interview that the administration's position was "curious," given that the Justice Department paid nearly $500,000 to Attorney General Edwin Meese III's personal lawyers for six months' work in 1984, when an independent counsel investigated Meese.

Lopez, now a professor at Stanford Law School, and his co-counsel, Roy B. Caceres, now a judge in San Diego, said they worked about 2,000 hours on the case over a five-year period. An $11,000 fee award works out to $5.65 an hour, Lopez said, to be paid, if at all, more than 10 years after beginning work. Neither lawyer has received any money.

No lawyer would ever take a case on those terms, Lopez said, especially an unpopular one.

The jury award, he said, was the "first successful challenge ever" against police behavior toward Chicanos in the often tense barrio. The judge who presided over the trial ruled that the police conduct was intentional and "motivated by a general hostility to the Chicano community."

In addition, the Riveras and their friends, with their modest incomes, searched in vain for weeks for a local lawyer who would take on the city. Their congressman eventually steered them to Caceres and Lopez, who had a small firm in San Diego.

The case involved taking conflicting testimony from scores of witnesses, Lopez said, while the city denied any wrongdoing and bitterly fought the case, refusing to settle and battling each point through four years of pretrial maneuvering.

The NAACP legal defense fund agreed that the city had a right to defend its case, "but once it has decided to defend a case to the death, it may not then be heard to complain when it is faced with a reasonable attorney's fee caused by its own litigation tactics."

Given the small amounts of money usually at stake in these cases, one EEOC attorney said in an interview, lawyers' fees are themselves a deterrent to future misconduct and an incentive to settle or at least get to trial quickly.