O'Neal et al v. America's Best Tire LLC et al

Filing 78

ORDER - IT IS ORDERED: 1. Plaintiffs' motion for attorneys' fees and non-taxable expenses (Doc. 74 ) is granted in part and denied in part. Plaintiff is awarded $60,000 in attorneys' fees and $3,361.00 in costs against Pla intiff. 2. The TD Defendants are responsible for 80% of the total attorneys' fees and costs ($50,688.80). 3. The AD Defendants are accountable for 20% of the total attorneys' fees andcosts ($12,672.20).(See document for further details). Signed by Judge David G Campbell on 4/5/17.(SLQ)

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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 Deoncea O’Neal, et al., 10 Plaintiffs, 11 ORDER v. 12 No. CV-16-00056-PHX-DGC America’s Best Tire LLC, et al., 13 Defendants. 14 15 16 Plaintiffs Deoncea O’Neal and Ryan White, individually and on behalf of the 12 17 opt-In Plaintiffs, obtained a $30,000 settlement from Defendants in this FLSA case. 18 They now ask the Court to award them more than $147,000 in attorneys’ fees and costs. 19 Doc. 74. The motion is opposed and fully briefed. Docs. 75, 76, 77. No party requests 20 oral argument. For the reasons set forth below, the Court will grant the motion in part 21 and deny it in part. 22 I. Background. 23 Plaintiffs claimed in this case that Defendants, a group of tire stores and their 24 individual owners, violated the Fair Labor Standards Act (“FLSA”) by failing to pay their 25 tire porters, crew members, and tire technicians the statutory premium for overtime work. 26 Defendants are approximately 25 limited liability companies, at least some of which own 27 and operate tire stores under the name America’s Best Tires (the “ABT companies” or 28 “ABT”); Andrew Dees, an individual who owned all of the ABT companies until 1 September 2013 and continued to own 10 companies until April 2016; and Travis M. 2 Dees, Andrew’s cousin, who purchased 14 ABT companies from Andrew in September 3 2013 and has owned them since. See Doc. 1, ¶¶ 18-45; Doc. 28-1, ¶¶ 2-3; Doc. 29-1, 4 ¶¶ 1, 10. Andrew, his wife, and his companies1 (the “AD Defendants”) are represented 5 by different counsel than Travis and his companies2 (the “TD Defendants”). 6 Plaintiff Deoncea O’Neal worked for ABT from approximately May 2012 to 7 December 2014. Doc. 1, ¶ 8. Plaintiff Ryan White worked for ABT from approximately 8 April 2012 to February 2014. 9 Plaintiffs filed this action in January 2016. Doc. 1. In March 2016, the TD 10 Defendants moved for summary judgment, admitting that they violated the FLSA by 11 failing to pay Plaintiffs a premium for overtime hours and that they were liable for unpaid 12 overtime compensation and liquidated damages, but arguing that the case against them 13 was moot because they tendered back wages and liquidated damages to the named 14 Plaintiffs. Doc. 19. Plaintiffs argued in response that they never accepted the payment 15 offered by the TD Defendants. Doc. 26 at 4 n.2. The Court determined that summary 16 judgment was inappropriate because Plaintiffs had not accepted the checks tendered by 17 the TD Defendants, and the parties remained adverse. Doc. 36 (citing Campbell-Ewald 18 Co. v. Gomez, 136 S. Ct. 663, 670-71 (2016)). 19 Following the denial of summary judgment, Defendants asked the Court to require 20 Plaintiffs to post a bond to ensure payment of costs in the event Defendants prevailed. 21 22 23 24 25 26 27 28 1 Andrew’s companies are: (1) AZ Best Automotive, LLC; (2) AZ Best Tire 4097, LLC; (3) Arizona Best Tire Services, LLC; (4) AZ Best Tire 3902, LLC; (5) AZ Best Tire, LLC; (6) AZ Best Tire 7048, LLC; (7) AZ Best Tire 8334, LLC; (8) Arizona Best Mobile Tire Services, LLC; (9) AZ Best Tire & Auto 1335, LLC; and (10) AZ Best Tire 5201, LLC. Doc. 29 at 2. 2 Travis’s companies are: (1) America’s Best Tire Employment Services, LLC; (2) America’s Best Tire, LLC; (3) America’s Best Tire 203, LLC; (4) America’s Best Tire Buckeye, LLC; (5) America’s Best Tire Glendale, LLC; (6) America’s Best Tire Grand, LLC; (7) America’s Best Tire Mesa, LLC; (8) America’s Best Tire Peoria, LLC; (9) America’s Best Tire Van Buren, LLC; (10) America’s Best Transportation Services, LLC; (11) America’s Best Wholesale Tire, LLC; (12) America’s Best Wholesale Tire LV, LCC; (13) America’s Best Wholesale Tire Tucson, LLC; and (14) Camelback Automotive Repair, LLC. Doc. 28 at 1. -2- 1 Doc. 44. The Court denied the motion, stating that “Defendants have not shown that 2 Plaintiffs are unlikely to succeed on the merits. They argue that the named Plaintiffs are 3 unlikely to obtain damages beyond those included in the offer of judgment, but they 4 ignore entirely the prospect that Plaintiffs might succeed on the merits by proving their 5 collective action claims.” Doc. 51 at 3. 6 Thereafter, the Parties reached a settlement and filed a joint motion requesting the 7 Court’s approval, which the Court granted. Docs. 72, 73. Under the settlement, the AD 8 Defendants paid $6,000 and the TD Defendants paid $24,000. The settlement permits 9 Plaintiffs to seek attorneys’ fees and costs. 10 II. Analysis. 11 A. 12 Where the filing of an action causes a defendant to pay unpaid wages to an FLSA 13 plaintiff, that plaintiff becomes a prevailing party entitled to attorneys’ fees. See Orozco 14 v. Borenstein, No. CV-11-02305-PHX-FJM, 2013 WL 4543836, at *2 (D. Ariz. Aug. 28, 15 2013). By virtue of the settlement, Plaintiffs and the opt-In Plaintiffs received both 16 liquidated damages and back wages. See Doc. 72-1. Prevailing Party. 17 Defendants contend that Plaintiffs are not the prevailing party. They note that the 18 TD Defendants admitted at the outset of litigation that there were unpaid overtime wages 19 owed to Plaintiffs and attempted to pay the named Plaintiffs the unpaid wages and 20 liquidated damages as early as March 2016. Plaintiffs refused the offer and continued the 21 lawsuit seeking damages for time worked off the clock. Doc. 76 at 5 (“The key reason 22 that the litigation moved forward from Plaintiffs’ perspective was because Plaintiffs 23 worked time off the clock and were not paid for it.”); see also Doc. 75 at 8. In the end, 24 Defendants note, Plaintiffs recovered nothing for time worked off the clock. Doc. 76 at 5. 25 Defendants’ initial offers, however, were not equivalent to, or in excess of, the 26 final settlement amount. Defendants admit that the TD Defendants’ initial offer included 27 unpaid wages and liquidated damages only for the named Plaintiffs, with nothing for the 28 opt-in Plaintiffs. Doc. 75 at 6-7. Defendants further admit that “[i]n order to get the -3- 1 matter resolved without further litigation,” Defendants agreed to pay amounts not 2 included in the original offer, including approximately $3,100 to each named Plaintiff as 3 a class representative incentive payment and about $7,500 in collective liquidated 4 damages to the opt-in Plaintiffs. Id. at 9. These amounts would not have been recovered 5 without Plaintiffs’ rejection of the initial settlement offer. 6 The fact that Plaintiffs recovered nothing for time worked off the clock does not 7 change the analysis. 8 agreement states that “each Plaintiff and Opt-in Plaintiff in this matter will have received 9 100 percent or more of their unpaid overtime wages, plus equal amounts in liquidated 10 damages, according to Defendants’ own time and compensation records.” Doc. 72 at 3 11 (emphasis added). This is not an admission that no off-the-clock hours were worked, but 12 a concession that Plaintiffs would give up those claims in exchange for avoiding 13 prolonged litigation. See id. at 4 (“[A]dditional discovery and motion practice would be 14 extremely costly and time-consuming in light of the potential additional recoverable 15 damages,” and “the risk and expense of pursuing discovery regarding the alleged off-the- 16 clock hours worked . . . would not have been justified, given the low amounts at stake 17 and the likelihood of delayed payment to the class.”). The joint motion asking the Court to approve the settlement 18 Defendants also argue that Plaintiffs are not the prevailing party because they 19 refused a $10,000 settlement offer from the AD Defendants in October 2016 and received 20 a total of $6,000 from the AD Defendants in the final settlement. Doc. 75 at 8; Doc. 76 at 21 6. The Court disagrees. The AD Defendants’ Offer of Judgment proposed a payment of 22 $10,000 in exchange for dismissal of claims against the AD Defendants and resolution of 23 “attorneys’ fees, taxable costs, expert witness fees and interest incurred by Plaintiffs.” 24 Doc. 76-5 at 3-4. The final settlement offer resolved only the issue of damages, not 25 attorneys’ fees and other costs. Plaintiffs are the prevailing party in this matter. 26 B. 27 Prevailing plaintiffs are entitled to attorneys’ fees and costs under the FLSA. See 28 29 U.S.C. § 216(b); Haworth v. State of Nev., 56 F.3d 1048, 1051 (9th Cir. 1995). The Reasonableness. -4- 1 trial court has discretion in determining the amount of an award for attorneys’ fees. To 2 determine the reasonableness of requested fees, federal courts generally use the 3 “lodestar” method. See Hensley v. Eckerhart, 461 U.S. 424, 437 (1983); United States v. 4 $186,416.00 in U.S. Currency, 642 F.3d 753, 755 (9th Cir. 2011). Under this method, the 5 Court must first determine the initial lodestar figure by taking a reasonable hourly rate 6 and multiplying it by the number of hours reasonably expended on the litigation. 7 Hensley, 461 U.S. at 433. 8 1. Hourly Rate. 9 The “reasonable hourly rate” is not determined by the rates actually charged, but 10 by the rate prevailing in the community for “similar work performed by attorneys of 11 comparable skill, experience, and reputation.” Schwarz v. Sec’y of Health & Human 12 Servs., 73 F.3d 895, 908 (9th Cir. 1995). The relevant community is generally the forum 13 in which the court sits. Barjon v. Dalton, 132 F.3d 496, 500 (9th Cir. 1997). The party 14 seeking an award of fees should submit evidence – in addition to the attorneys’ own 15 affidavits – supporting the rates claimed. Hensley, 461 U.S. at 433; Blum, 465 U.S. at 16 895 n.11. “Affidavits of the plaintiffs’ attorney[s] and other attorneys regarding 17 prevailing fees in the community, and rate determinations in other cases . . . are 18 satisfactory evidence of the prevailing market rate.” United Steelworkers of Am. v. 19 Phelps Dodge Corp., 896 F.2d 403, 407 (9th Cir. 1990). 20 attorneys’ fees presents such evidence, the opposing party “has a burden of rebuttal that 21 requires submission of evidence . . . challenging the accuracy and reasonableness of the 22 . . . facts asserted by the prevailing party in its submitted affidavits.” Chaudhry v. City of 23 L.A., 751 F.3d 1096, 1111 (9th Cir. 2014) (quoting Camancho v. Bridgeport Fin., Inc., 24 523 F.3d 973, 980 (9th Cir. 2008)) (internal quotation marks omitted). 25 Once the party seeking Plaintiffs’ counsel submit a declaration regarding their experience, expertise, and 26 fee rates, which counsel attests to be the average market rate. 27 Supervising attorney Michael Zoldan has been practicing employment law since 28 November 2010 and requests an hourly rate of $300. Id. at 4-7, ¶¶ 6, 17. Attorney -5- Doc. 74-1 at 2-11. 1 Clifford Bendau was brought in as co-counsel because of his expertise in litigating FLSA 2 actions. Id. at 5, ¶ 8. Mr. Bendau has litigated over 80 wage and hour cases and also 3 requests an hourly rate of $300. Id. Attorney Jason Barrat is a partner at Zoldan Law 4 Group, PLLC, has been licensed for 5 years, and has a practice that is “almost entirely 5 focused on wage and hour claims on behalf of plaintiffs.” Id., ¶ 9. “[B]ecause Mr. 6 Barrat’s primary assistance in this case related to client communications and discovery 7 matters, counsel have decided to reduce his hourly rate to $250 per hour solely for the 8 purpose of this fee application.” Id. Plaintiffs’ counsel also submit the declaration of 9 Amy Liberman, an attorney licensed to practice law in Arizona since 1984. Id. at 13-16. 10 Ms. Liberman avers that she is familiar with the hourly billing rates of attorneys in the 11 State of Arizona, and that the typical billing rates for a practitioner of Plaintiffs’ 12 counsel’s caliber and experience ranges from $250 to $500 per hour. Id. at 16, ¶¶ 8-9. 13 Defendants present no evidence that the rates charged by Plaintiffs’ counsel are 14 unreasonable for lawyers with similar qualifications in Phoenix, Arizona. Nor have 15 Defendants’ counsel offered their own billing rates as a comparison. Courts in this 16 District have found the requested amount to be reasonable for FLSA cases in the Phoenix 17 area. See Riendeau v. Apache Carson Partners, LP, 2013 WL 6728141, at *1 (D. Ariz. 18 Dec. 19, 2013) (finding $300.00 a reasonable hourly rate for a lead counsel in an FLSA 19 case); Orozco, 2013 WL 4543826 at *3 (reducing plaintiff’s counsel’s hourly rate from 20 $400 to $300 because “$400 an hour is in excess in comparison to an average hourly rate 21 of $300 in the Phoenix market.”). Accordingly, the Court finds that the hourly billing 22 rates for Mr. Zoldan and Mr. Bendau are reasonable. 23 Similarly, the proposed hourly rate of $250 for Mr. Barrat is not excessive. 24 Plaintiffs concede that Mr. Barrat’s “assistance in this case primarily related to client 25 communications and discovery matters” (Doc. 74 at 13), but his contributions were not so 26 few as to be characterized as “paralegal and administrative type tasks” (Doc. 76 at 15). 27 The records show that Mr. Barrat drafted discovery disclosures and responses, aided in 28 calculating damages, and engaged in extensive client communication. See Doc. 74-3 at -6- 1 2-19. Plaintiffs’ proposed billing rate is at the low end of Ms. Liberman’s stated range of 2 reasonable rates. See Doc. 74-1 at 16, ¶ 9. The Court finds this rate reasonable. 3 4 2. Hours Billed. Defendants next challenge the number of hours billed by Plaintiffs’ counsel. 5 Doc. 76 at 8-15; Doc. 75 at 11-13. 6 Plaintiffs’ counsels’ work product should have taken little time because “this litigation is 7 a replica of previous litigation filed by the Zoldan Law Group PLLC against the Travis 8 Dees Defendants in 2015,” and “the only new issue raised in the current litigation was the 9 collective action request.” Doc. 76 at 8. Defendants present a list of billed tasks they 10 11 12 13 14 Specifically, Defendants argue that much of believe to be “prima facie unreasonable,” including:  63.5 hours billed in total for the complaint (Doc. 76, Ex. F (26.3 hours of meetings and communication; 15.6 hours of research; and 22.4 hours spent drafting and reviewing the complaint)).  40.4 hours billed for the motion for conditional certification, including 10.8 hours of interoffice conferences (Id., Ex. G); 15  82.6 hours constructing the response to TD Defendants’ motion for summary judgment (Id., Ex. H); 16  47.4 hours preparing for mediation, not including time spent calculating damages (Id., Ex. I); and 17 18 19  47.2 hours preparing their application for attorneys’ fees, not including the 10 hours they requested for their reply to the application for attorneys’ fees (Id., Ex. J (including 10.6 hours of meetings and communication; 4.5 hours on research; and 32.1 hours spent working on fee application)). 20 Plaintiffs respond that they “spent the requisite hours to achieve success for their 21 clients and were successful on all matters.” Doc. 77 at 10-11. Plaintiffs also note that 22 their “motions, memoranda, and other documents submitted to this Court have few to no 23 typographical errors, contain all necessary and accurate legal and factual support, and 24 adhere to the Court’s local rules.” Id. at 10. 25 Although Plaintiffs are factually correct, the Court finds that much of Plaintiffs’ 26 counsels’ billed time on the complaint and motion for attorneys’ fees could have been 27 reduced given the redundant nature of much of this litigation. Mr. Zoldan states in his 28 declaration that he has “represented numerous employment litigation plaintiffs in both -7- 1 Superior Court and the Federal Court for the District of Arizona[,]” and that “Mr. Bendau 2 has litigated over 80 wage and hour cases, including FLSA collective action cases.” 3 Doc. 74-1, ¶¶ 5, 8. A quick search of Mr. Zoldan’s pending and former cases in this 4 courthouse shows that, in the past 24 months, he has brought no fewer than 17 actions 5 under the FLSA, many of which seek to recover unpaid overtime like this action. 6 Additionally, Plaintiffs’ counsel recently litigated a substantially similar case, minus the 7 collective action component, against the same TD Defendants who are now party to this 8 case. See Bush v. Am.’s Best Tire LLC, No. 15-cv-01261-PHX-SRB (D. Ariz. Nov. 16, 9 2015). The Court has reviewed the complaints from both dockets. Large sections are 10 virtually identical, and appear to have been copied from one to the next, simply replacing 11 plaintiff names and dates. The Court finds that 63.5 hours billed for the complaint is 12 clearly excessive. Given the repetitive nature of a complaint and the obvious use of prior 13 work product in the development of this complaint, the Court will reduce Plaintiffs’ 14 counsels’ time billed on the drafting and review of the complaint to a total of 15 hours. 15 Similarly, the 57.2 total hours billed for the attorneys’ fees motion is excessive. 16 See Doc. 74-3 at 18-19. The Court finds that 20 billable hours is reasonable for a motion 17 for attorneys’ fees. 18 Defendants also assert that Plaintiffs’ counsels’ “billing entries were fraught with 19 block billing entries and confusing descriptions” in violation of LR Civ. 54.2.3 Doc. 76 20 at 9. Defendants specify the following entries: 21 22 23 24 25  2/14/16 – Mr. Zoldan’s .8 hours block billed “meeting with process server and email from process server”;  2/26/16 Mr. Zoldan’s 1.6 hours block billed for “Initial review of demand letter and threat for Rule 11 sanctions from AD attorneys; review supporting documents; email and confer with co-counsel RE same”;  4/1/16 – Mr. Zodlan’s 2.5 hours block billed for “Continue Review of TD MSJ; analyze response under Rule 56(d)”; 26 27 28 3 “The itemized statement for legal services rendered shall reflect . . . (B) The time devoted to each individual unrelated task performed” and “[t]he party seeking an award of fees must adequately describe the services rendered so that the reasonableness of the charge can be evaluated.” LR Civ 54.2 (e)(1)(B) & (e)(2). -8- 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21  4/4/16 – Mr. Zoldan’s 1.2 hours of duplicative researching regarding social media (Jason Barrat performed same research for 2.2 hours on 4/5/16);  4/7/16 – Mr. Bendau’s 1.0 hour block billed for “Multiple correspondence with JB/MZ RE motion for conditional certification”;  4/13/16 – Mr. Zoldan’s .8 hours block billed for “multiple correspondences CB RE opposition to MSJ and accompanying documents”;  6/6/16 – Mike Zoldan’s 5.5 hours block billed for “Begin drafting first set of NUIs and RFPs to all Defendants (AD Defendants and TD Defendants)”;  6/8/16- Mike Zoldan’s 6.0 hours block billed for “Continue drafting NUIs and RFPs/edit/finalize”;  7/5/16 – Mr. Bendau’s 1.4 hour block billed for reviewing “AD’s Second Supplemental Disclosure Statement and accompanying documents; review AD discovery responses”;  7/8/16 – Mr. Bendau’s 1.2 hours block billed for “Review/Analyze Motion for Security and potential basis for sanctions in response”;  7/11/16 – Mr. Zoldan’s 5.2 hours block billed for “Research Re TD Motion for Security Bond (includes repealing Ariz. R. 67(d) and other authority as relied upon by TD; search for cases permitting bond in FLSA action in or out of 9th circuit)”;  7/26/16 – Mr. Zoldan’s 6.6 hours block billed for “Review/Analyze Defendants response to Plaintiffs first set of discovery requests; reconcile payments made to plaintiffs by analyzing payroll records and time sheets produced thus far for damages calculations”;  Time entries with the confusing description “work on” without describing whether the work was reviewing, drafting, conducting legal research or other actions, including: 4/5/16 in the amount of $1,560.00, 4/6/16 in the amount of $1,050.00, 4/15/16 in the amount of $900.00, 7/15/16 in the amount of $420.00, 7/26/16 in the amount of $1,980.00, 8/10/16 in the amount of $150.00, 9/12/16 in the amount of $1,320.00, 10/5/16 in the amount of $300.00, 1/12/17 in the amount of $1,800.00, 1/13/17 in the amount of $1,950.00, multiple entries on 1/16/17 totaling $3,615.00 and an entry on 1/17/16 in the amount of $300.00; the grand total of fees sought of which are vague in description is not les [sic]than $15,345.00. 22 23 Id. at 9-10 (emphasis in original). 24 When counsel engage in block billing by grouping several tasks together, it is 25 difficult for a court to evaluate the reasonableness of each individual task within the 26 entry. Welch v. Metropolitan Life Ins. Co., 480 F.3d 942, 948 (9th Cir. 2007). After 27 reviewing the time entries Defendants identify as block billing, the Court concludes that 28 these entries violate LR Civ. 54.2(d). The block billing makes it difficult for the Court to -9- 1 assess what fees are excessive and what fees are reasonable, and the Court will therefore 2 reduce the amount of fees awarded by 25%. See Shaft v. Soc. Sec. Admin. Com’r, No. 3 CV-13-08206-PCT-DGC, 2014 WL 3809097, at *1 (D. Ariz. Aug. 1, 2014) (holding the 4 Court may reduce requested fees when the requesting party engaged in block billing and 5 the Court is unable with precision to separate out fees attributable to specific motions and 6 excessive work); see also Hensley, 461 U.S. at 434 (holding that fees that are excessive, 7 redundant, or otherwise unnecessary should be excluded from a fee request). 8 Lastly, Defendants argue that Plaintiffs’ counsels’ use of a “.2 minimum billing 9 increment” was excessive, “accounting for approximately 23.8 hours of [additional] 10 time.” Id. at 10-11. Defendants ask the Court to “half the value of all billing entries 11 incorporating the minimum .2 billing increment” because such minimum billing is a 12 “practice [that] has not been accepted by the Court.” Id. at 11. The Court agrees that the 13 use of a .2 minimum billing increment is improper when used in a request for attorneys’ 14 fees. Work lasting only a minute or two would, under such a practice, always be billed at 15 12 minutes. See also Ariz. Ethical Rule 1.5 cmt. [5] (“A lawyer should not exploit a fee 16 arrangement based primarily on hourly charges by using wasteful procedures.”). “[T]his 17 type of billing practice inherently inflates and distorts the time actually expended, and 18 hence is unacceptable.” In re Price, 143 B.R. 190, 194 (Bankr. N.D. Ill. 1992). 19 The Court has discretion to determine whether a minimum billing increment is 20 excessive and to reduce the fee accordingly. See Welch, 480 F.3d at 948. Because the 21 Court cannot know whether the .2 entries billed by Plaintiffs’ counsel took 1 minute, 6 22 minutes, or 12 minutes, the Court will reduce the total value of all Plaintiffs’ counsels’ .2 23 entries by half. 24 3. Lodestar Figure. 25 The Court has found that $300 a reasonable hourly rate for Mr. Zoldan and Mr. 26 Bendau, and $250 is a reasonable hourly rate for Mr. Barrat. Plaintiffs submit that these 27 three attorneys billed 218.5 hours, 188.3 hours, and 79.3 hours respectively, for a total of 28 486.1 hours billed. Doc. 74-1 at 8-9, ¶ 21. The Court will reduce the billing entries that - 10 - 1 were block billed by 25%.4 The Court will reduce the 23.8 hours billed in the .2 2 minimum increment by half.5 The Court will also reduce the number of hours billed 3 drafting the complaint from 63.5 hours to 15 hours,6 and the drafting of the attorneys’ 4 fees motion from 57.2 hours to 20 hours.7 After applying each of these modifications, the 5 attorneys’ adjusted total hours are as follows: 158.1 hours for Mr. Zoldan, 161.6 hours for 6 Mr. Bendau, and 64.1 hours for Mr. Barrat. Using these modified totals, the Court 7 reaches a loadstar value of $111,935.8 8 4. The Kerr Factors Adjustment. 9 The Court must also consider the Kerr factors that have not been subsumed within 10 the initial lodestar calculation. See Kerr v. Screen Extras Guild, Inc., 526 F.2d 67, 70 (9th 11 Cir. 1975); see also Cunningham v. County of Los Angeles, 879 F.2d 481, 487 (9th Cir. 12 1988). These factors are: “(1) the novelty and complexity of the issues, (2) the special 13 skill and experience of counsel, (3) the quality of representation, and (4) the results 14 obtained.” Jordan v. Multnomah County, 815 F.2d 1258, 1262 n.6 (9th Cir. 1987). 15 There is a “strong presumption that the lodestar figure represents a reasonable fee, and 16 17 18 19 20 21 22 4 The Court finds that Mr. Zoldan billed a total of 52.1 hours using block billing entries, Mr. Bendau billed a total of 6 hours using block billing entries, and Mr. Barrat billed a total of 0.6 hours using block billing entries. After a 25% reduction, these totals are reduced to 39.1 hours, 4.5 hours, and .4 hours respectively. The Court did not include block billing entries related to the complaint or fee application in this calculation. 5 Using the minimum .2 increment, Mr. Zoldan billed 11.6 hours, Mr. Bendau billed 5.8 hours, and Mr. Barrat billed 6.4 hours. 6 23 24 25 26 27 28 Mr. Zoldan’s time spent working on the complaint will be reduced from 32.3 hours to 7 hours. Mr. Bendau’s time working on the complaint will be reduced from 22.7 hours to 5 hours. And Mr. Barrat’s time working on the complaint will be reduced from 8.5 hours to 3 hours. 7 Hours spent on the attorneys’ fees motion will be reduced as follows: Mr. Zoldan’s from 31.3 hours to 15 hours; Mr. Bendau’s from 6.6 hours to 2 hours; Mr. Barrat from 9.3 hours to 3 hours; and time spent on the reply from 10 hours to 5 hours. 8 [(MZ adjusted hours + CB Adjusted hours)*$300 billing rate + (JB adjusted hours*$250 billing rate)] = Loadstar Value [(158.1+161.6)*300 + (64.1*250)] = $111,935 - 11 - 1 adjustments of the lodestar are proper only in “rare” and “exceptional” cases. Blum v. 2 Stenson, 465 U.S. 886, 898-901 (1984). 3 Although Plaintiffs ultimately were the prevailing party, it is significant that the 4 monetary result they obtained was just over $30,000, an amount only slightly above what 5 was offered by Defendants to settle this case at the outset of the litigation. The Supreme 6 Court has noted that “the extent of a plaintiff’s success is a crucial factor in determining 7 the proper amount of an award of attorney’s fees[.]” Hensley, 461 U.S. at 440. The 8 Ninth Circuit has likewise noted that “[t]he time, to be compensated in an award, must be 9 reasonable in relation to the success achieved. It is an abuse of discretion for the district 10 court to award attorneys’ fees without considering the relationship between the extent of 11 success and the amount of the fee award.” McGinnis v. Kentucky Fried Chicken of 12 California, 51 F.3d 805, 810 (9th Cir. 1994) (quotation marks omitted) (citing Hensley, 13 461 U.S. at 436; Farrar v. Hobby, 506 U.S. 103, 114 (1992)). 14 At the same time, the Ninth Circuit has made clear that attorneys’ fee awards 15 should not be made strictly proportional to the amount recovered in the case. Evon v. 16 Law Offices of Sidney Mickell, 688 F.3d 1015, 1033 (9th Cir. 2012). It would be error for 17 the Court to hold that the amount of fees may not exceed the value of the settlement or a 18 portion of that value. Id. The determination to be made, rather, is the amount that 19 constitutes a reasonable fee in light of all the circumstances in the case. 20 The Court concludes that awarding more than $110,000 in attorneys’ fees for the 21 work done in this case, given the familiarity of Plaintiffs’ counsel with the issues litigated 22 and the extent of success, would be unreasonable. In fact, in language relevant to this 23 case, the Ninth Circuit noted that “no reasonable person would pay lawyers $148,000 to 24 win $34,000.” McGinnis, 51 F.3d at 810. The Court concludes that a fee award of 25 $60,000 represents the reasonable value of the work performed by Plaintiffs’ counsel. 26 This is a considerable reduction from the lodestar amount, but the Court views this as an 27 exceptional case where departure from the lodestar amount is warranted. Plaintiffs 28 recovered only a modest amount in excess of the settlements offered at the beginning of - 12 - 1 this case, and the Court cannot conclude that ten months of litigation were required to 2 recover it. In addition, Plaintiffs did not obtain any additional non-monetary relief that 3 would increase the value of their result. 4 Although it is also true that $60,000 is considerably more than the financial benefit 5 conferred on Plaintiffs by the continuation of this litigation after the initial settlement 6 offer, the Court cannot conclude that such an award is excessive. At least some of the 7 litigation costs were incurred because of Defendants’ litigation actions. And as the Ninth 8 Circuit has noted, successful litigation, even with modest recoveries, can vindicate rights 9 protected by statute. Evon, 688 F.3d at 1033. 10 C. 11 Plaintiffs’ also request $6,064.70 in costs and non-taxable costs. Doc. 74 at 15. 12 “Under the Fair Labor Standards Act, costs [‘of the action’] include reasonable out-of- 13 pocket expenses.” Van Dyke v. BTS Container Serv., Inc., No. 08-cv-561-KI, 2009 WL 14 2997105, at *2 (D. Or. Sept. 15, 2009) (citing Smith v. Diffee Ford–Lincoln–Mercury, 15 Inc., 298 F.3d 955, 969 (10th Cir. 2002)). “Costs of the action “can include costs beyond 16 those normally allowed under Fed. R. Civ. P. 54(d) and 28 U.S.C. § 1920.” Id. (citing 17 Herold v. Hajoca Corp., 864 F.2d 317, 323 (4th Cir. 1988) (FLSA’s costs provision 18 authorizes an award of costs as part of a “reasonable attorney’s fee,” which would not be 19 authorized under Rule 54 or 28 U.S.C. § 1920). Costs. 20 Defendants argue that Plaintiffs’ requested costs are excessive and inappropriate. 21 Doc. 75 at 13-14. Specifically, Defendants object to the following costs: (1) $203.70 for 22 obtaining a transcript of the scheduling conference; (2) $2,762.50 in sums paid to Optime 23 Administration, a firm retained to administer the opt-in portion of the case; (3) $170 paid 24 to attempt service on “Max Jones”; and (4) $2,500 in “overhead,” a total that is not 25 itemized or explained. 26 Plaintiffs do not respond to these objections in their reply brief. See Doc. 77. The 27 Court agrees that the costs for overhead are unjustified. Plaintiffs state that these include 28 “[e]stimated overhead costs for photocopying, meals, Westlaw charges, postage, [and] - 13 - 1 transportation.” Doc. 74-5 at 2 (Plaintiffs’ Statement of Costs). But these are the costs of 2 running a law practice, and Plaintiffs provide no support for the requested amount. The 3 Court also finds the cost for a scheduling conference transcript unreasonable in light of 4 the detailed scheduling order entered by the Court after the conference. Doc. 38. 5 The Court does not find the remaining costs unreasonable. Plaintiffs include 6 documentation showing that they paid the amounts they now request. Id. at 4-15. The 7 Court does not find it unreasonable for Plaintiffs to have hired Optime for administration 8 of the opt-in portion of the case. Additionally, Plaintiffs’ hired “Max Jones” to process 9 service on Defendants, and paid him for $170 for the task. See id. at 9 (Exhibit C). 10 Accordingly, the Court finds that Plaintiffs are entitled to $3,361.00 in costs.9 11 D. 12 The AD Defendants argue that they “should not be held jointly and severally 13 liable” with the TD Defendants because “Plaintiffs have failed to prove that any joint 14 employer relationship existed between the [AD] Defendants and the [TD] Defendants.” 15 Doc. 76 at 3. Plaintiffs argue that “[n]otwithstanding any alleged differences between the 16 [TD] and [AD] Defendants, the clear language of the Settlement agreement forecloses 17 any argument that one defendant’s obligation to pay attorneys’ fees and costs differs from 18 another’s,” and the Agreement’s use of the term “Parties” indicates that “all defendants in 19 this action should be jointly and severally responsible for payment of an award of 20 attorneys’ fees.” Doc. 77 at 7-8. Joint and Several Liability. 21 The Court disagrees. The Settlement Agreement distinguishes the AD and TD 22 Defendants by defining both at the outset. Doc. 72-1 at 1. The Settlement Agreement 23 goes on to state that “[f]or the convenience of this Settlement Agreement only and not as 24 an admission of joint or concerted efforts, the [TD] Defendants and the [AD] Defendants 25 are referred to collectively as Defendants.” Id. Under Section 1(a) of the Settlement 26 Agreement, the terms state that the “[TD] Defendants agree to pay the sum of [$24,000], 27 9 28 Costs Requested – Costs Found Unreasonable = Awarded Costs $6,064.70 – ($2500 + $203.7) = $3,361.00 - 14 - 1 and the [AD] Defendants agree to pay the sum of [$6,000.]” Id. at 2. Additionally, under 2 Section 1(e), the Settlement Agreement states that the parties were unable to reach an 3 agreement regarding the amount of reasonable attorneys’ fees and costs, and have agreed 4 to ask the Court “to determine to what extent Plaintiffs’ counsel are entitled to be 5 compensated for their fees and costs[.]” Id. at 4. Under subsection (g), “[t]he Parties 6 further stipulate that . . . Plaintiffs’ attorneys’ fees and costs shall be decided by the 7 Court’s Order regarding Plaintiffs’ counsels’ application for attorneys’ fees.” Id. The 8 Settlement Agreement does not provide that Defendants will be jointly and severally 9 liable for the fee award. 10 Under 29 U.S.C. § 216(b), the Court in an FLSA action “shall, in addition to any 11 judgment awarded to the plaintiff or plaintiffs, allow a reasonable attorney’s fee to be 12 paid by the defendant, and costs of the action.” 13 responsible for the violations of the FLSA against a plaintiff, it is within the Court’s 14 discretion to hold the defendants jointly and severally liable. Fegley v. Higgins, 19 F.3d 15 1126, 1131 (6th Cir. 1994) (“the FLSA defines an ‘employer’ to include ‘any person 16 acting directly or indirectly in the interest of an employer in relation to an employee’. . . . 17 [and] more than one ‘employer’ can be simultaneously responsible for FLSA 18 obligations.”). In this instance, there has been no finding of fact that both Defendants 19 were employers at the time of the FLSA violations, nor that both Defendants were 20 responsible for the violations. Because the parties reached a settlement agreement, the 21 only undisputed facts are as follows: the AD Defendants sold businesses to the TD 22 Defendants in September 2013, and the named Plaintiffs worked for the AD Defendants 23 for no more than 4 out of their 36 total months of employment at issue. These limited 24 facts are insufficient for the Court to award joint and severally liability for all attorneys’ 25 fees. Where multiple employers are 26 The AD Defendants argue that these facts requires the Court to limit the AD 27 Defendants’ liability to not more than 7.5% of any attorneys’ fee awarded. Doc. 76 at 4. 28 The Court disagrees. The AD Defendants present no evidence to establish that only 7.5% - 15 - 1 of all injuries occurred prior to October 2013, and no evidence that the unpaid overtime 2 alleged by Plaintiffs occurred at a consistent rate over a set time period. 3 The Court finds that assignment of joint and several liability between Defendants 4 is inappropriate. 5 liability of the Defendants is the amount each agreed to pay in the settlement. 6 Accordingly, the Court finds each Defendant will be accountable for the amount of 7 attorneys’ fees proportional to its agreed amount to be paid in settlement.10 The only information before the Court evidencing the respective 8 E. 9 The TD Defendants argue that “any award entered in favor of Plaintiffs against 10 [TD] Defendants . . . should not include Travis Dees’ wife or his marital community” 11 because “Mrs. Dees was never served in this matter and is not a party.” Doc. 75 at 14. 12 Plaintiffs do not respond to this argument in their reply. In Arizona, a party wishing to 13 hold a marital community accountable for any obligation must sue both spouses jointly. 14 Weimer v. Maricopa Cty. Cmty. Coll. Dist., 184 F.R.D. 309, 310 (D. Ariz. 1998) (“Under 15 Arizona community property law, a ‘judgment against one spouse does not bind the 16 community.’”) (citing Spudnuts, Inc. v. Lane, 676 P.2d 669, 670 (Ariz. 1984)). Travis 17 Dees’ spouse is not a party in this action. Accordingly, Travis Dees’ marital community 18 will not be bound by the Court’s judgment of attorneys’ fees. Marital Community Liability. 19 IT IS ORDERED: 20 1. Plaintiffs’ motion for attorneys’ fees and non-taxable expenses (Doc. 74) is 21 granted in part and denied in part. Plaintiff is awarded $60,000 in attorneys’ fees and 22 $3,361.00 in costs against Plaintiff. 23 24 2. The TD Defendants are responsible for 80% of the total attorneys’ fees and costs ($50,688.80). 25 26 27 28 10 In the Settlement Agreement, the TD Defendants agreed to pay $24,000, and the AD Defendants agreed to pay $6,000. Doc. 72-1 at 2, § 1. Accordingly, the TD Defendants will be accountable for 80% of the attorneys’ fees and the AD Defendants will be accountable for the remaining 20%. - 16 - 1 2 3 3. The AD Defendants are accountable for 20% of the total attorneys’ fees and costs ($12,672.20). Dated this 5th day of April, 2017. 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 17 -

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