Anthony Stissi v. Bag Fund, LLC et al

Filing 138

ORDER DENYING DEFENDANT BAG FUND LLC'S MOTION FOR ATTORNEYS FEES 132 by Judge Otis D. Wright, II (lc)

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O 1 2 3 4 5 6 7 United States District Court Central District of California 8 9 10 11 Case № 5:17-cv-00534-ODW (PLA) ANTHONY STISSI, an individual, Plaintiff, 12 ORDER DENYING DEFENDANT’S MOTION FOR ATTORNEYS’ FEES [132] vs. 13 14 BAG FUND, LLC; LEO FASEN; 15 VINCENT J. QUIGG; STEWART TITLE 16 GUARANTY COMPANY; EBS 17 ESCROW; and DOES 1 through 80, 18 inclusive, Defendants. 19 20 I. 21 INTRODUCTION Defendant Bag Fund, LLC moves for attorneys’ fees for work completed in 22 defending against Plaintiff’s Complaint. 23 (“Mot.”), ECF No. 132.) 24 Defendant’s Motion.1 (See generally Mot. for Attorney Fees For the reasons discussed below, the Court DENIES 25 26 27 28 1 After carefully considering the papers filed in support of and in opposition to the Motion, the Court deemed the matter appropriate for decision without oral argument. Fed. R. Civ. P. 78; C.D. Cal. L.R. 7-15. II. 1 FACTUAL AND PROCEDURAL BACKGROUND 2 On March 21, 2017, Plaintiff filed a Complaint against various defendants 3 alleging violations of the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. 4 § 1692; Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681; and other state law 5 claims. 6 dismissed Plaintiff’s Complaint for lack of subject matter jurisdiction over Plaintiff’s 7 federal law claims and declined to exercise supplemental jurisdiction over Plaintiff’s 8 state law claims. (Order Granting Mot. to Dismiss (“Order Granting MTD”), ECF 9 No. 103.) (See generally Compl., ECF No. 1.) On January 10, 2018, the Court On January 25, 2018, Defendant Bag Fund, LLC filed a Motion for 10 Attorneys’ Fees. (ECF No. 104.) On July 12, 2018, the Court terminated the motion 11 in light of Defendant’s same pending fee motion in state court and instructed 12 Defendant that, should it be necessary, it should refile its motion no later than thirty 13 days after the date of the state court decision. (Minute Order, ECF No. 126.) 14 On October 24, 2018, the state court issued its decision granting Plaintiff’s 15 Motion to Tax Costs in its entirety and denying Defendant’s Motion for Attorneys’ 16 Fees. (Decl. of Therese S. Harris (“Harris Decl.”) Ex. 3 (“Notice of Ruling”), at 20– 17 21, ECF Nos. 135-5–135-6.) On November 21, 2018, Defendant filed a Notice of 18 Motion for Attorney Fees, but failed to file the Memorandum of Points and 19 Authorities until November 27, 2018. (See Notice of Mot., ECF No. 127; ECF 20 No. 129.) Accordingly, on November 28, 2018, the Court struck the November 21 21 Motion for Attorneys’ Fees due to Defendant’s filing errors. (Order, ECF No. 131.) 22 Defendant re-filed its Motion for Attorneys’ Fees along with the supporting evidence 23 and declarations on November 28, 2018, five days after the deadline set by the Court. 24 (See generally Mot.) 25 III. LEGAL STANDARD 26 In the Ninth Circuit, a district court that has dismissed a case for lack of subject 27 matter jurisdiction also lacks jurisdiction to award attorneys’ fees. Skaff v. Meridien 28 N. Am. Beverly Hills, LLC, 506 F.3d 832, 837 (9th Cir. 2007) (“A court that lacks 2 1 jurisdiction . . . lacks the authority to award attorneys’ fees.”); Smith v. Brady, 972 2 F.2d 1095, 1097 (9th Cir. 1992); Latch v. United States, 842 F.2d 1031, 1033 (9th Cir. 3 1988). 4 jurisdiction,” they “cannot themselves confer subject-matter jurisdiction.” Zambrano 5 v. Immigration & Naturalization Serv., 282 F.3d 1145, 1150 (9th Cir. 2002), 6 amended, 302 F.3d 909 (9th Cir. 2002). When fee-shifting statutes do not “provide an independent grant of 7 The FDCPA provides that “[o]n a finding by the court that an action under this 8 section was brought in bad faith and for the purpose of harassment, the court may 9 award to the defendant attorney’s fees reasonable in relation to the work expended and 10 costs.” 15 U.S.C. § 1692k(a)(3). The defendant bears the burden of showing, by 11 more than a “conclusory assertion,” that the plaintiff acted in bad faith and for the 12 purpose of harassment. Guerrero v. RJM Acquisitions LLC, 499 F.3d 926, 940–41 13 (9th Cir. 2007). As long as the plaintiff’s claim is “‘minimally colorable,’ a district 14 court does not abuse its discretion in finding the suit was brought in good faith.” 15 Fields v. Credit Mgmt. Sys., No. EDCV 14-1853 JGB (SPx), 2016 WL 9088755, at *3 16 (C.D. Cal. Apr. 20, 2016) (quoting Guerrero, 499 F.3d at 940). 17 IV. DISCUSSION 18 The Court lacks jurisdiction to award attorneys’ fees in this case, and even if 19 this Court had jurisdiction, the Court cannot make a finding that the action was 20 brought in bad faith and for the purpose of harassment 21 The Ninth Circuit has consistently applied the rule against awarding attorneys’ 22 fees when the court lacks subject matter jurisdiction “to a broad array of fee-shifting 23 statutes.” Zambrano, 282 F.3d at 1150. Unless the statute provides an independent 24 grant of subject-matter jurisdiction, this rule applies regardless of which “specific fee- 25 shifting statute [is] involved.” Id. 26 The Court dismissed Plaintiff’s federal claims for lack of subject matter 27 jurisdiction and declined to extend supplemental jurisdiction over Plaintiff’s state-law 28 claims. (Order Granting MTD 8.) Specifically, the Court found that if it were to 3 1 adjudicate the merits of the FDCPA and FCRA allegations, “it would be forced to 2 determine the validity of the underlying [state-court] Judgment,” and as a result, 3 “under the Rooker-Feldman doctrine,” “the Court . . . lacks subject-matter jurisdiction 4 to hear Plaintiff’s FDCPA and FCRA claims.” (Id. at 7–8.) Nor does the Court find 5 that 15 U.S.C. § 1692k(a)(3) provides the Court with an independent grant of subject 6 matter jurisdiction. Thus, the Court does not have jurisdiction to award attorneys’ 7 fees. 8 Even if the Court had jurisdiction to award attorneys’ fees, Defendant has not 9 made the necessary showing of bad faith under § 1692k(a)(3). For the Court to award 10 attorneys’ fees under the FDCPA, Defendant bears the burden of putting forth 11 “evidence that the plaintiff knew that his claim was meritless and that plaintiff 12 pursued his claims with the purpose of harassing the defendant.” Gorman v. Wolpoff 13 & Abramson, LLP, 435 F. Supp. 2d 1004, 1013 (N.D. Cal. 2006), aff’d in part, rev’d 14 in part, 584 F.3d 1147 (9th Cir. 2009). While the existence of a “decision squarely 15 establish[ing] that [the plaintiff’s] claim was without merit” could constitute bad faith, 16 mere misapplication of legal principles does not. Juras v. Aman Collection Serv., Inc., 17 829 F.2d 739, 745 (9th Cir. 1987). 18 Beyond conclusory statements, Defendant has not met its burden in 19 demonstrating that Plaintiff knew that its claim was meritless. Defendant does not cite 20 any case law discussing the application of § 1692k(a)(3), and “[t]his alone is grounds 21 to deny the motion.” See Fields, 2016 WL 9088755, at *3. Defendant also does not 22 mention that the Complaint was brought for the purpose of harassment, as required by 23 the statute. See Bonner v. Redwood Mortg. Corp., No. C 10-00479 WHA, 2010 WL 24 2528962, at *5 (N.D. Cal. June 18, 2010) (citing Guerrero, 499 F.3d at 940–41) 25 (declining to award attorneys’ fees under § 1692k, despite finding the plaintiff acted in 26 bad faith, where the defendant failed to show the plaintiff’s purpose was to harass). 27 28 The Court lacks subject matter jurisdiction, and Defendant failed to make the requisite showing that it is entitled to attorneys’ fees. 4 V. 1 2 CONCLUSION For the reasons discussed above, the Court DENIES Defendant’s Motion. 3 4 IT IS SO ORDERED. 5 6 April 29, 2019 7 8 9 10 ____________________________________ OTIS D. WRIGHT, II UNITED STATES DISTRICT JUDGE 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 5

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