Fooksman v. Abramson et al

Filing 34

ORDER ADOPTING REPORT AND RECOMMENDATION IN PART, ENTERING DEFAULT JUDGMENT. Signed by Judge William H. Orrick on 03/31/2021. (jmdS, COURT STAFF) (Filed on 3/31/2021)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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EUGENE FOOKSMAN,
Plaintiff,

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United States District Court
Northern District of California

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Case No. 3:20-cv-07109-WHO

v.
HUNTER ABRAMSON, et al.,
Defendants.

ORDER ADOPTING REPORT AND
RECOMMENDATION IN PART,
ENTERING DEFAULT JUDGMENT
Re: Dkt. Nos. 25, 29

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Plaintiff Eugene Fooksman moved to enter default judgment against defendants Hunter

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Abramson and Cairn Capital Holdings, d/b/a The Cairn Companies, LLC, on February 16, 2021.

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Dkt. No. 25; see also Dkt. No. 22 (entry of default). Magistrate Judge Thomas S. Hixson issued a

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report and recommendation on March 11, 2021, requesting reassignment to a district judge and

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recommending that the motion be granted and damages and attorney’s fees be awarded. Report

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and Recommendation (“R&R”) [Dkt. No. 29]. No party has filed objections to the report and

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recommendation and the time for objecting has expired. See Fed. R. Civ. P. 72(b).

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I have reviewed the Complaint, exhibits, motion, and report and recommendation. I

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ADOPT IN PART Judge Hixon’s report and recommendation with respect to the entry of default

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judgment and its award of damages. For the reasons explained there, Fooksman’s motion for

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default judgment is GRANTED on the breach of contract claim and Fooksman is awarded

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$3,187,028 in damages. Judgment will be entered accordingly.

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I will, however, depart from the recommended award of attorney’s fees. The law governing

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this determination is discussed thoroughly in the report and recommendation. The contract at

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issue permits awards of attorney’s fees arising from suits over default on the loan up to five

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percent of the loan principal. See R&R at 15. Fooksman sought $43,852.95, which is less than

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the five percent ceiling. Id.; Dkt. No. 25 at 22–23. Judge Hixson found the number of hours

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worked reasonable, and I agree for the reasons explained there. See R&R at 19–20. Where I

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disagree is this: Judge Hixson reduced the hourly rate that each attorney billed Fooksman by

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roughly half based on concerns that the rates were unreasonable given prevailing market rates.

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See id. at 16–19. I will increase this rate award, though not to the full amount originally

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requested.

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Three lawyers worked on the matter, all at Cooley LLP. Id. at 17. Amanda Main is a
partner whose 2020 billing rate was $1,040; Alexander Galicki is an associate whose 2020 billing

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rate was $875; Robert Eisenbach “offered advice” for less than one hour at a rate of $1,270. Id.

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(citing Declaration of Amanda Main [Dkt. No. 25-1]). Beginning February 1, 2021, Main’s rate

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United States District Court
Northern District of California

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rose by $90 an hour and Galicki’s rate rose by $155 an hour. Dkt. No. 25-1 ¶¶ 8–10. Fooksman

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was given a ten percent discount in this case. Id. ¶ 7. Judge Hixson found these rates higher than

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the norm in this District for attorneys of similar qualifications working on similar cases.

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I agree with the report and recommendation to the extent that it found that this matter’s

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relative simplicity does not warrant awarding the full rates billed: It is a straightforward breach of

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contract case for non-repayment of a loan that quickly resulted in entry of default judgment. See

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Vogel v. Harbor Plaza Ctr., LLC, 893 F.3d 1152, 1158 (9th Cir. 2018) (explaining that the rate is

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based, among other considerations, on the nature of the work). As Judge Hixson illustrated, courts

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in this district have often found partners’ rates between roughly $500 and $1,000 to be reasonable

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in such cases. R&R at 17–18 (collecting cases). The rates courts have found reasonable to be

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billed by associates are more variable. While they have reached approximately as high as

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Galicki’s 2020 rate, see, e.g., In re High-Tech Emp. Antitrust Litig., No. 11-CV-02509-LHK, 2015

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WL 5158730, at *9 (N.D. Cal. Sept. 2, 2015), they have tended to have an upper limit of closer to

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$500, see R&R at 17–18 (collecting cases).

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Because of the straightforward nature of what has been required of counsel so far in this

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suit, and considering the prevailing market rates courts have found in this District for attorneys of

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like experience, I will reduce each attorney’s rate by twenty-five percent and apply Judge

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Hixson’s lodestar methodology. I will also use the 2020 rates because (1) the great majority of the
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work was performed prior to the billing increase, (2) the 2021 increase carries the figures further

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from reasonable baseline rates (especially when it comes to Galicki), and (3) Fooksman—who

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bears the burden—has not pointed to any case of similar complexity in which such high rates were

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found reasonable. And I will apply the rate reduction after the ten percent discount given to

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Fooksman because that is the rate the attorneys negotiated and these fee awards must not result in

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a “windfall.” Vogel, 893 F.3d at 1158.

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Main’s post-discount fee is reduced to $702, Galicki’s to $590, and Eisenbach’s to $857.

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Multiplying these rates by the hours Judge Hixson found reasonable—16.6 for Main, 30.7 for

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Galicki, and 0.8 for Eisenbach—leads to a total award of $30,451.80. Fooksman is AWARDED
this amount in attorney’s fees.

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United States District Court
Northern District of California

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IT IS SO ORDERED.

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Dated: March 31, 2021

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William H. Orrick
United States District Judge

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