Greer v. T. F. Thompson & Sons, Inc., et al

Filing 137

MEMORANDUM OF DECISION AND ORDER granting in part and denying in part 132 Defendant's Motion for Attorney Fees. Directing the Clerk of Court to enter judgment in favor of Defendant Thompson for attorneys' fees in the amount of $221,534.50. Signed by Senior Judge Stephen M McNamee on 12/11/12.(DMT)

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1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 Dudley Greer, dba Greer Farms, 10 Plaintiff, 11 vs. 12 T.F. Thompson & Sons, Inc., et al., 13 Defendants. 14 15 T.F. Thompson & Sons, Inc., et al., 16 Counter-Claimants, 17 vs. 18 Dudley Greer, dba Greer Farms, 19 20 Counter-Defendant. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) No. CV-10-799-PHX-SMM MEMORANDUM OF DECISION AND ORDER 21 Before the Court is the Renewed Motion for Award of Attorney’s Fees and Costs by 22 Defendants/Counter-Claimants T.F. Thompson & Sons, Inc., et al. (“Thompson”). (Doc. 23 132.) Plaintiff/Counter-Defendant Dudley Greer, dba Greer Farms (“Greer”) has responded, 24 Thompson has replied, and the matter is fully briefed. (Docs. 134, 135.) The Court will grant 25 Thompson’s motion in part, and deny in part. 26 BACKGROUND 27 Greer filed the initial complaint in this case against Thompson, alleging four claims 28 arising out of contract, one claim for negligence, and one claim for fraudulent concealment. 1 (Doc. 1.) The dispute centered around Greer’s assertion that Thompson sold Greer diseased 2 seed potatoes. (Id.) Thompson filed a motion in limine to exclude Plaintiff’s expert witness, 3 which the Court granted. (Doc. 111.) The Court then also granted Thompson’s motion for 4 summary judgment on all six of Greer’s claims, finding that in light of the exclusion of 5 Greer’s witness, there was no longer any genuine dispute of material facts sufficient to 6 support those claims. (Id.) 7 Thompson subsequently filed its original motion for attorney fees and costs. (Doc. 8 114.) Greer then filed a motion to alter or amend the judgment of the Court pursuant to 9 FED.R.CIV.P. 59(e), arguing that the Court’s ruling excluding Greer’s witness and granting 10 summary judgment for Thompson misapprehended the factual record, improperly resolved 11 disputed factual issues, and was manifestly unjust. (Doc. 117.) The Court ordered 12 Thompson to respond to Greer’s motion to amend judgment, which Thompson did. (Doc. 13 118; Doc. 123.) Greer also filed his response to Thompson’s original motion for attorney 14 fees and costs, and Thompson replied. (Doc. 119; Doc. 124.) 15 The Court then denied Greer’s motion to amend the judgment. (Doc. 125.) On 16 February 21, 2012, Greer appealed the Court’s judgment to the United States Court of 17 Appeals for the Ninth Circuit. (Doc. 127.) In light of the appeal, this Court denied 18 Thompson’s original motion for attorney fees without prejudice to re-file pending disposition 19 of the appeal. (Doc. 130.) On June 22, 2012, the Court of Appeals granted Greer’s motion 20 to dismiss the appeal. (Doc. 131.) Thereupon, Thompson filed its renewed motion for 21 attorney fees, asking once again for attorneys fees, with the additional inclusion of attorney 22 fees incurred by Thompson in responding both to Greer’s motion to amend the judgment and 23 Greer’s appeal to the Ninth Circuit. (Doc. 132; Doc. 133.) 24 LEGAL STANDARD 25 An Arizona court may award reasonable attorney fees to a successful party in any 26 contract action. ARIZ. REV. STAT. § 12-341.01(A). “In any contested action arising out of 27 a contract, express or implied, the court may award the successful party reasonable attorney 28 fees.” ARIZ. REV. STAT. § 12-341.01(A). However, this statutory provision does not create -2- 1 a presumption that a successful party is entitled to attorney fees. Associated Indem. Corp. 2 v. Warner, 694 P.2d 1181, 1182-83 (Ariz. 1985) (en banc). An award of reasonable attorney 3 fees under § 12-341.01(A) should be made to mitigate the burden of the expense of litigation 4 to establish a just claim or a just defense. ARIZ. REV. STAT. § 12-341.01(B). “It need not 5 equal or relate to the attorney fees actually paid or contracted, but the award may not exceed 6 the amount paid or agreed to be paid.” Id. 7 The trial court has discretion to award attorney fees under § 12-341.01(A) and is 8 urged to use the following factors in making its determination: (1) the merits of the claim or 9 defense presented by the unsuccessful party; (2) whether the litigation could have been 10 avoided or settled and the successful party’s efforts were completely superfluous in achieving 11 the results; (3) whether assessing fees against the unsuccessful party would cause an extreme 12 hardship; (4) whether the successful party did not prevail with respect to all the relief sought; 13 (5) the novelty of the legal question presented; (6) whether such claim or defense had 14 previously been adjudicated in this jurisdiction; and (7) whether the award in any particular 15 case would discourage other parties with tenable claims or defenses from litigating or 16 defending legitimate contract issues for fear of incurring liability for substantial amounts of 17 attorney fees. Warner, 694 P.2d at 1184. 18 If there is any reasonable basis for the exercise of the trial court’s discretion in 19 awarding attorney fees under Section 12-341.01, an appellate court will not disturb the trial 20 court’s judgment. Id. at 1184-85. 21 a movant must provide in support of a motion for attorney fees, including a statement of 22 consultation from moving counsel, a copy or recitation of the fee agreement, an itemized fee 23 and expense report, and an affidavit establishing the reasonableness of the rate, time spent, 24 and expenses incurred. L.R.Civ. 54.2(d) identifies the supporting documentation 25 In regards to attorney fees for appellate work, Ninth Circuit Rule 39-1.6(a) provides: 26 Time Limits. Absent a statutory provision to the contrary, a request for attorneys’ fees shall be filed no later than 14 days after the expiration of the period within which a petition for rehearing may be filed, unless a timely petition for rehearing is filed. 27 28 -3- 1 Ninth Circuit Rule 39-1.8 further provides that any party who may be eligible for attorney 2 fees on appeal may “within the time permitted in Circuit Rule 39-1.6, file a motion to transfer 3 consideration of attorneys fees on appeal to the district court . . . from which the appeal was 4 taken.” 5 This rule authorizes the Ninth Circuit to transfer a request for appellate fees to the 6 district court, “but the decision to permit the district court to handle the matter rests with the 7 court of appeals,” and absent transfer a district court is not authorized to rule on a request for 8 such fees. Cummings v. Connell, 402 F.3d 936, 947-48 (2005). However, a district court 9 may be authorized to rule on a motion for appellate attorneys’ fees where the language of the 10 fee-shifting statute relied on by the moving party allows the district court to award fees for 11 all levels of litigation. See NRDC v. Winter, 543 F.3d 1152, 1164 (2008) (finding that the 12 fee-shifting statute at issue allowed the district court to award appellate fees, because the 13 statute stated that a court shall award fees incurred by the prevailing party in any civil action 14 brought “in any court having jurisdiction of that action.” (emphasis in original)). 15 DISCUSSION 16 Thompson requests this Court award it $227,744.50 in attorney fees and costs arising 17 from its defense against Greer’s claims. (Doc. 133.) Thompson includes in this calculation 18 additional fees and costs incurred in the time since filing its original motion for fees, which 19 Thompson asserts were incurred responding both to Greer’s Motion to Amend and his appeal 20 to the Ninth Circuit. (Id.) 21 Greer responds with four main arguments. (Doc. 134.) First, that this Court’s 22 previous order denying Thompson’s original motion with leave to re-file precludes 23 Thompson from filing this new, revised motion. (Id.) Second, that this Court should deny 24 Thompson’s request for appellate fees because it failed to properly request such fees before 25 the Ninth Circuit. (Id.) Third, that Thompson has failed to establish the reasonableness of 26 its overall request for fees. (Id.) And fourth, that Thompson has failed to establish the 27 specifics of its fee agreement with counsel, the reasonableness of its hourly rate, and the 28 reasonableness of time spent by counsel. (Id.) -4- 1 Additionally, Greer incorporates his previous response to Thompson’s original motion 2 for fees (Doc. 119). (Id.) In that original response, Greer argued further that Thompson’s 3 itemized list of charges included a number of items for which attorney fees should not be 4 awarded, such as travel time and clerical tasks. (Doc. 119 at 13-15.) The Court will address 5 each of Greer’s objections in turn. 6 I. 7 The Court finds that Thompson is not precluded from bringing this revised motion for 8 attorney fees. While the Court’s prior order (Doc. 130) stated that Thompson could 9 “reinstate its motion at the proper time” by filing a motion to renew, the Court did not 10 prohibit Thompson from updating the motion. (Id.) Moreover, after Thompson’s original 11 motion was submitted, Greer filed a motion to reconsider the Court’s order granting summary 12 judgment, and this Court ordered Thompson to respond. (Doc. 118.) The Court finds that 13 there is no just reason to prohibit Thompson from updating its motion to include those fees 14 Thompson alleges were incurred responding to Greer’s motion to reconsider. Thompson’s Revised Motion for Fees 15 II. 16 As to Thompson’s claim for fees incurred as a result of Greer’s appeal, Greer argues 17 that Thompson’s request must be denied for his failure to properly present the request before 18 the Ninth Circuit. (Doc. 134.) Greer asserts that because Thompson filed neither a request 19 for attorney fees before the Ninth Circuit, nor a request for transfer of the issue back to this 20 Court, Thompson cannot be awarded these fees by this Court. (Id. at 5-6.) Thompson’s Request for Appellate Fees 21 Thompson responds by arguing that the language of ARIZ. REV. STAT. § 12-341.01(A) 22 “does not limit an award of attorneys’ fees by this Court to only that portion of litigation 23 before this Court, but permits the Court to properly award fees for all levels of litigation.” 24 (Doc. 135 at 4.) In support of this assertion, Thompson cites to NRDC, 543 F.3d at 1164. 25 (Id.) Thompson’s reliance on NRDC is misplaced. In that case, the Ninth Circuit held that 26 the district court could award appellate fees despite the movant’s failure to satisfy Ninth 27 Circuit Rules, because the fee-shifting statute relied upon there, 42 U.S.C. § 1988, stated 28 explicitly that a court should award fees and other expenses incurred “in any court having -5- 1 jurisdiction of that action.” NRDC, 543 F.3d at 1164 (emphasis in original) (internal 2 citations omitted). 3 Here, Thompson offers no support for its theory that ARIZ. REV. STAT. § 12-341.01(A) 4 contains any such permissive language. (Doc. 135.) While the Court notes that section 5 12-341.01(A) does not explicitly limit the district courts to awarding fees incurred at that 6 level, neither does the plain language “indicate that the district court may properly award fees 7 for all levels of litigation.” NRDC, 543 F.3d at 1164. Moreover, 39-1.6 provides that the 8 time and procedural strictures will apply “absent a statutory provision to the contrary.” 9 Ninth Circuit Rule 39-1.6(a) (emphasis added). Here, there is no provision in ARIZ. REV. 10 STAT. § 12-341.01(A) which can be fairly read to contradict the clear requirements of the 11 Ninth Circuit rules. Thus, this Court finds that Thompson’s request for the $6,210.00 in fees 12 incurred at the appellate level must be denied. 13 III. 14 The Court finds that Thompson’s request for an award of attorney fees is reasonable. 15 This Court previously found that Greer’s case depended so heavily on the unreliable and 16 unsupported assertions of its expert that all six claims were dismissed on summary judgment 17 once the Court excluded the expert’s testimony. (Doc. 111.) In addition, Greer’s initial 18 demand prior to filing this suit was for $437,897.18. (Doc. 119 at 9.) The Court finds that 19 Defendant’s refusal of this demand was reasonable. Thereafter, the parties attempted 20 settlement through formal mediation, but were unsuccessful. (Doc. 133 at 5.) Reasonableness of Overall Request for Fees 21 Greer contends that an award of attorney fees would constitute a significant financial 22 hardship, and that the Court should thus deny Thompson’s motion. However, on October 23 18, 2012, the Court granted Greer thirty days in which to file verified financial statements 24 under seal as evidence of financial hardship. (Doc. 136.) Greer failed to file any such 25 documents, and thus the Court has no substantiated evidence of financial hardship. 26 Thompson prevailed with respect to all relief sought, and this case did not present 27 novel legal issues. Greer argues, however, that an award of fees to Thompson will have a 28 chilling effect on the pursuit of other tenable claims. (Doc. 119 at 11.) Greer alleges that -6- 1 Thompson was defended by the Fireman’s Fund under a reservation of rights, which 2 provided unlimited funds to Thompson for litigation, but no funds to settle, which created 3 a natural incentive for Thompson to litigate aggressively and refuse to negotiate toward 4 settlement. (Id.) The Court disagrees that the mere fact that Thompson was defended under 5 a reservation of rights necessarily leads to a conclusion that Thompson did not engage in 6 good faith settlement discussions. Thus, Greer fails to show that an award of fees in this case 7 would have a deterrent effect on the pursuit of other, meritorious claims. 8 Therefore, the Court finds that Thompson’s overall request for attorney fees in this 9 case is reasonable. 10 IV. Thompson’s Fee Agreement, Reasonableness of Hourly Rate, and Reasonableness of Time Spent. 11 12 Greer next argues that Thompson has failed to comply with the requirements of 13 L.R.Civ. 54.2(d)(2), by not submitting the proper documentation of its fee agreement with 14 counsel. (Doc. 134 at 7.) Greer’s argument is without merit. L.R.Civ. 54.2(d)(2) provides 15 that a copy of any written fee agreement, “or a full recitation of any oral fee agreement” must 16 be attached to the memorandum in support of a motion for attorney fees. Here, Thompson 17 provides a copy of the e-mail correspondence in which it established the fee agreement with 18 counsel. (Doc. 133-2.) Moreover, Thompson’s attorney Stephen McCarron recites the fee 19 agreement fully in his statement. (Doc. 133-5 at 7.) Thus, the Court finds that Thompson 20 properly complied with the documentation requirements of the local rules. 21 Greer argues further that the hourly rate of $300.00 paid by Thompson was not 22 reasonable. (Doc. 134 at 8.) Greer alleges that Thompson provides no evidence that this rate 23 is reasonable for insurance defense work in the Phoenix, Arizona legal community, and that 24 Mr. McCarron’s declaration does not establish his familiarity with the prevailing community 25 rates. (Id.) 26 Greer’s argument here is unavailing; L.R.Civ. 54.2(d)(4)(B) requires a “brief 27 discussion of the terms of the written or oral fee agreement,” and “the method by which the 28 customary charges were established, the comparable prevailing community rate or other -7- 1 indicia of value of the services rendered.” Here, attorney McCarron’s statement adequately 2 supports the hourly rate with discussion of the value of the services rendered by him and his 3 co-counsel, attorneys with substantial experience in agricultural litigation. (Doc. 133-5 at 4 3-6.) Moreover, the Court is entitled to rely on its own familiarity with customary rates and 5 the reasonableness of attorney fees. See Ingram v. Oroudjian, 647 F.3d 925, 928 (9th Cir. 6 2011). Thus, the Court finds that Thompson’s requested hourly rate is reasonable. 7 Finally, Greer challenges the reasonableness of the time spent by Thompson’s 8 attorneys on two grounds: (1) that the billing ledger evidences inaccurate billing by attorney 9 McCarron; and (2) that Thompson’s claimed hours spent responding to his Motion to Amend 10 are excessive and improper. (Doc. 134 at 8-10.) 11 Greer argues that Mr. McCarron’s billing practices are obviously inaccurate due to 12 the fact that Mr. McCarron “never made a billing entry for less than two-tenths of an hour 13 in over two years of litigation,” and that “all of [his] time entries over 1.3 hours are billed to 14 the nearest half hour and usually to the nearest hour.” (Doc. 134 at 9.) Thompson responds 15 by pointing out that this billing method reflects the division of labor between himself and his 16 co-counsel Ms. Fassett, as evidenced by the numerous time entries of one-tenth of an hour 17 in her billing log. (Doc. 135 at 6.) The Court finds that Thompson’s billing logs do not 18 reflect an unreasonable accounting of time spent. 19 Greer argues also that the time spent by Thompson’s attorneys was not reasonable, 20 alleging that Thompson claims excessive hours spent responding to Greer’s Motion to Alter 21 or Amend Judgment. (Doc. 134 at 9-10.) According to Greer, Thompson’s attorneys could 22 have prepared their response in less than the forty hours claimed. (Id.) Greer’s argument, 23 however, amounts to nothing more than baseless second-guessing of the time spent by 24 Thompson’s attorneys – time which was necessitated by Greer’s filing of the Motion to 25 Amend. Thus, the Court finds that the time spent by Thompson’s counsel in responding to 26 that motion was not unreasonable. 27 In its original response to Thompson’s first motion for fees, Greer argued also that 28 Thompson’s itemized list of charges included a number of items for which attorney fees -8- 1 should not be awarded, such as travel time and clerical tasks. (Doc. 119 at 13-15.) 2 Thompson responded to Greer’s argument by agreeing to forego its claim for those 91.90 3 hours Greer alleged were improper. (Doc. 124 at 4.) Thus, this argument is moot. 4 CONCLUSION 5 Therefore, after a review of the record, including the affidavit of Stephen M. 6 McCarron and an accompanying itemized statement of fees, the Court finds that Thompson’s 7 claim for attorneys’ fees in the amount of $227,744.50 is reasonable, with the exception of 8 the $6,210.00 claimed in appellate fees. Thus, Thompson will be awarded fees in the amount 9 of $221,534.50. 10 Accordingly, 11 IT IS ORDERED that Defendant’s Motion for Attorneys’ Fees is GRANTED in part 12 13 14 15 and DENIED in part. (Doc. 132) IT IS FURTHER ORDERED directing the Clerk of Court to enter judgment in favor of Defendant Thompson for attorneys’ fees in the amount of $221,534.50. DATED this 11th day of December, 2012. 16 17 18 19 20 21 22 23 24 25 26 27 28 -9-

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