Shabazz v. Pinnacle Credit Services LLC
Filing
76
ORDER granting in part 59 Motion for Attorney Fees and denying 68 Motion for Review of Clerk's Taxing of Costs. Plaintiff is Awarded $28,104 in attorneys' fees. Ordered by Judge William J. Martinez on 11/23/2016. (cthom, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge William J. Martínez
Civil Action No. 15-cv-0687-WJM-NYW
LEONA SHABAZZ,
Plaintiff,
v.
PINNACLE CREDIT SERVICES LLC, a Minnesota limited liability company,
Defendant.
ORDER ON DEFENDANT’S MOTION FOR REVIEW OF CLERK’S TAXING OF
COSTS AND PLAINTIFF’S MOTION FOR ATTORNEYS’ FEES
Plaintiff initiated this action on March 5, 2015, arising out of Defendant’s alleged
violations of the Fair Debt Collection Practices Act (“FDCPA”), specifically 15 U.S.C.
§ 1692e(2)(A), e(8), and e(10). (ECF No. 1.) Defendant sent Plaintiff an Offer of
Judgement, which Plaintiff accepted on March 18, 2016. (ECF Nos. 55, 55-1.)
Judgment was entered in favor of Plaintiff on March 22, 2016. (ECF No. 57.) On April
26, 2016, costs were taxed against Defendant in the amount of $3,362.94. (ECF No.
62.) Before the Court is Plaintiff Leona Shabazz’s Motion for Attorneys’ Fees, and
Defendant Pinnacle Credit Services, LLC’s Motion for Review of Clerk’s Taxing of
Costs. (ECF Nos. 59, 58.)
I. COSTS & EXPENSES ANALYSIS
A.
Legal Standard
Federal Rule of Civil Procedure 54(d)(1) provides that “[u]nless a federal statute,
these rules, or a court order provides otherwise, costs—other than attorneys’
fees—should be allowed to the prevailing party. Rule 54 “makes the award of costs
presumptive.” Mitchell v. City of Moore, 218 F.3d 1190, 1204 (10th Cir. 2000). The final
award of costs rests within the discretion of the court. Tilton v. Capital Cities ABC, Inc.,
115 F.3d 1471, 1476 (10th Cir. 1997). Additionally, “[t]he party seeking an award of
costs bears the burden of showing the necessity of the costs incurred.” Crandall v. City
and Cnty. of Denver, 594 F. Supp. 2d 1245, 1247 (D. Colo. 2009). In determining
whether costs are reasonably necessary to the litigation of the case, a court must not
employ hindsight but instead look at the circumstances at the time the costs were
incurred. In re Williams Sec. Litig.–WCG Subclass, 558 F.3d 1144, 1148 (10th Cir.
2009).
B.
Analysis
1.
Defendant’s Motion is Timely
Plaintiff asserts that Defendant’s motion is untimely and should be denied for that
reason. (ECF No. 70 at 1.) Under Local Rule 5.1(d) “[t]he time to respond or reply shall
be calculated from the date of electronic service, regardless of whether other means of
service are used. The Notice of Electronic Filing (NEF) generated by CM/ECF
constitutes a certificate of service.” D.C.COLO.CivR 5.1(d). Here, the Court’s records
state that the NEF was generated on 4/27/2016 at 8:50 AM MDT; thus, the date of
electronic service is April 27, 2016. (ECF No. 62.) Under Rule 54(d)(1), Defendant has
seven days to file a motion with the Court to review the Clerk’s action. Fed. R. Civ. P.
54(d)(1). Defendant filed the instant motion on May 4, 2016, precisely seven days from
the date of electronic service. (ECF No. 68.) Thus, Defendant’s motion is timely.
2.
Meet and Confer Efforts Were Sufficient
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Plaintiff asserts that Defendant failed to confer with Plaintiff prior to filing its
motion and should be denied for that reason. (ECF No. 10 at 2.) Under Local Rule
54.1, “[a]fter filing a bill of costs and prior to appearing before the clerk, counsel and any
unrepresented party seeking costs shall file a written statement that they have conferred
as to disputes regarding costs.” D.C.COLO.CivR 54.1. The Court finds that
Defendant’s efforts to meet and confer were previously directed at the issue now before
the Court. While the Court is generally concerned with whether the efforts made were
sufficiently robust and transparent, the Court finds for the purposes of the instant motion
that they were adequate.
3.
Deposition Transcripts Were a Required Expenditure
The Clerk taxed Plaintiff’s deposition costs associated with the various
deponents: Plaintiff Leona Shabazz, Valerie Bartosh, Jacqueline Betzold, Tonya Larkin,
Gregory Gruett, and Robert Castle. (ECF No. 58). The costs at issue here involve
expenses covering the transcribing of five of those depositions. (ECF No. 68 at 3.)
Defendant argues that Plaintiff has made no showing that the deposition transcripts
were necessarily obtained for use in the case at the time that they were ordered. (ECF
No. 68 at 3–4.) The total amount objected to is $2,612.25. (ECF No. 68 at 2.)
Whether materials are necessarily obtained for use in the case is a question of
fact. Callicrate v. Farmland Indus., Inc., 139 F.3d 1336, 1340 (10th Cir. 1998). When a
“deposition was reasonably necessary to the litigation, the resulting costs are generally
allowable.” Karsian v. Inter-Regional Fin. Grp., Inc., 13 F. Supp. 2d 1085, 1088 (D.
Colo. 1998). However, if the deposition was taken “simply for discovery purposes, then
costs are not recoverable.” Id. In Callicrate, the court noted:
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[C]aution and proper advocacy may make it incumbent on
counsel to prepare for all contingencies which may arise
during the course of litigation which include the possibility of
trial . . . . We will not, therefore, attempt to employ the
benefit of hindsight in determining whether an otherwise
taxable item was necessarily obtained for use in the case.
Rather, we hold that such a determination must be made
based on the particular facts and circumstances at the time
the expense was incurred.
139 F.3d at 1340.
Here, Plaintiff ordered the transcripts at the time that the depositions were taken.
(ECF No. 58-2.) The depositions were taken roughly two months prior to the dispositive
motion deadline. (ECF No. 48). Plaintiff contends that he took the five depositions of
Defendant’s witnesses because “they were either disclosed by Defendant as having
knowledge regarding the facts in this case and Plaintiff’s FDCPA claim and/or
Defendant’s defenses or they were identified in response to discovery requests as
having knowledge regarding the facts in this case.” (ECF No. 70 at 8.) Given that
Plaintiff took these depositions just prior to the dispositive motion deadline, and that all
deponents were Defendant’s fact witnesses, the Court finds that the deposition
transcripts for which costs were requested appear reasonably necessary for the
preparation of, and use in, litigation at the time they were taken.1
4.
Proportionality
Defendant claims that Plaintiff’s case “was not marshaled with proportionality” in
1
The Court is aware that other judges in this district have followed a more restrictive
approach requiring the party requesting deposition costs to proffer a specific justification for
incurring the cost of transcription. See Crandall v. City and Cnty. of Denver, 594 F. Supp. 2d
1245, 1250 (D. Colo. 2009); see also Tivis v. Dowis, 2016 WL 695933 (D. Colo. Feb. 22, 2016);
David v. Sirius Computer Solutions, 2014 WL 10896989 (D. Colo. Mar. 7, 2014). The Court
respectfully declines to follow those decisions.
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mind. (ECF No. 74 at 2.) Defendant asserts that “[t]here is no escaping the inevitable
and logical deduction that if the FDCPA did not provide for the recovery of attorneys’
fees and costs, no rational client would authorize or pay fees or costs several times the
maximum recoverable value.” (ECF No. 74 at 3.) Plaintiff responds that Defendant
does not provide any authority or basis for its proportionality argument as none exists
other than ipse dixit. (ECF No. 70 at 3.) Moreover, Plaintiff argues “awards in civil
rights and consumer protection matters regularly vastly exceed the plaintiff’s recovery.”
(ECF No. 71 at 2 (citing United States Football League v. National Football League, 887
F.2d 408, 415 (2nd Cir. 1989) (awarding $5.5 million fee award on $3.00 recovery) and
Norton v. Wilshire Credit Corp., 36 F. Supp. 2d 216, 220 (D.N.J. 1999) (rejecting
proportionality in awarding $58,000 in fees in an FDCPA case)).)
As for costs, Defendant argues that Plaintiff’s counsel did not seek discovery
proportional to the needs of the case, specifically referencing the five out-of-state
depositions taken by Plaintiff. (ECF No. 74 at 3 (citing Fed. R. Civ. P. 26(b)(1).)
Plaintiff responds that failing to fully engage in discovery would result in malpractice and
“violate Plaintiff’s counsel’s obligations to his client.” (ECF No. 70 at 9.)
The Scheduling Order permits each party to take up to five depositions per side.
(ECF No. 22 at 6.) Thus, the Court finds that Plaintiff’s discovery efforts were within this
Court’s discovery limitations, and that Plaintiff’s depositions of Defendant’s five fact
witnesses were reasonable and proportional in light of the issues at stake.
For the foregoing reasons, Defendant’s Motion for Review of Clerk’s Taxing of
Costs is denied.
II. ATTORNEYS’ FEES ANALYSIS
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A.
Legal Standard
Motions for attorneys’ fees are governed by Federal Rule of Civil Procedure,
54(d)(3). Under the FDCPA, such awards are granted to successful litigants pursuant
to 15 U.S.C. § 1692k(a)(3).
“The most useful starting point for determining the amount of a reasonable fee is
the number of hours reasonably expended on the litigation multiplied by a reasonably
hourly rate.” Hensley v. Eckerhart, 461 U.S. 424, 433 (1983). This is commonly
referred to as the “lodestar method” for calculating fees. Id.
The party requesting fees has the burden to “prove and establish the
reasonableness of each dollar, each hour, above zero” and bears the burden of
providing the required documentation and demonstrating that the fees requested are
reasonable. Mares v. Credit Bureau of Raton, 801 F.2d 1197, 1201 (10th Cir. 1986).
The best evidence of reasonable fees is “meticulous time records that ‘reveal . . . all
hours for which compensation is requested and how those hours were allotted to
specific tasks.’” Id. (quoting Ramos v. Lamm, 713 F.2d 546, 553 (10th Cir. 1983)).
Counsel should exercise “billing judgment” prior to submitting a fee request to
eliminate any needless, excessive, or redundant hours. Hensley, 461 U.S. at 434.
Billing judgment should also take into account the experience and relative skill of the
billing attorneys. Id. Additional factors to determine a fee’s reasonableness include “the
complexity of the case, the number of reasonable strategies pursued, . . . the responses
necessitated by the maneuvering of the other side,” any potential duplicative services,
and whether the hours would “normally be billed to a paying client.” Ramos, 713 F.2d at
554. Assessment of attorneys’ fees is a discretionary one and the district court “need
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not identify and justify every hour allowed or disallowed” with respect to legal services
rendered. Malloy, 73 F.3d at 1018. Doing so would only run counter to the “Supreme
Court’s warning that a request for attorneys’ fees should not result in . . . major
litigation.” Id.
As for the hourly rate, the Tenth Circuit has indicated that “the court must look to
‘what the evidence shows the market commands.’” Burch v. La Petite Academy, Inc.,
10 F. App’x 753, 755 (10th Cir. 2001) (quoting Case v. Unified Sch. Dist. No. 233, 157
F.3d 1243, 1255 (10th Cir. 1998)). The “local market rate” is usually defined by the
state or city in which the case is litigated. Ellis v. Univ. of Kan. Med. Ctr., 163 F.3d
1186, 1203 (10th Cir. 1998) (looking at the “the prevailing market rates in the relevant
community”); Case, 157 F.3d at 1256 (looking at fees lawyers charge in the area in
which the litigation occurs). The party requesting fees must also provide evidence of
the prevailing market rate for similar services by “lawyers of reasonably comparable
skill, experience, and reputation” in the relevant community. Ellis, 163 F.3d at 1203.
Once the Court determines the lodestar, it may “adjust the lodestar upward or
downward to account for the particularities” of the work performed. Phelps v. Hamilton,
120 F.3d 1126, 1131 (10th Cir. 1997). The Court is not required to reach a lodestar
determination in every instance, however, and may simply accept or reduce a fee
request within its discretion. Hensley, 461 U.S. at 436–37.
B.
Fees Claimed
1.
Reasonable Billing Rate
Plaintiff seeks an hourly rate of $300. (ECF No. 59 at 5.) In support of her
motion, Plaintiff submits that her attorney, Mr. David Larson, has practiced law in the
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State of Colorado and this District since 2001. (ECF No. 59 at 6.) Mr. Larson has filed
and resolved over 2,300 FDCPA cases. (ECF No. 59 at 9.) Plaintiff has also submitted
the affidavit of Richard Wynkoop, a fellow FDCPA practitioner, in support of her
attorneys’ fee motion. (See ECF No. 59-2.) Mr. Wynkoop opines that $300/hour is
consistent with the market rate for attorneys in this District with comparable skill and
experience to that of Mr. Larson. (ECF No. 59-2 at 2.)
Defendant disagrees with this rate, and requests the Court to reduce Mr.
Larson’s hourly rate to $250. (ECF No. 67 at 3.) Defendant cites to cases where Mr.
Larson has previously sought $250 per hour. (ECF No. 67 at 3 (citing Castro v. First
Nat’l Collection Bureau, Inc., 2012 WL 4468318 (D. Colo. Sept. 27, 2012) and White v.
Cavalry Portfolio Serv., LLC, 2012 WL 899280 (D. Colo. Mar. 16, 2012)).) However, the
applicable market rate has changed since 2012, and Plaintiff’s counsel has continued
litigating FDCPA cases since the cited cases were resolved.
Moreover, numerous cases in the District of Colorado have found that $300 is a
rate reflective of the current prevailing market rate in the local community–particularly in
the context of FDCPA litigation.2 Indeed, over the past year, six other judges from this
District have found $300 to be a reasonable rate for Mr. Larson. See Tolman v. Stellar
Recovery, Inc., 2016 WL 4717982 (D. Colo. Sept. 6, 2016); Madrid v. Stellar Recovery,
Inc., 2016 WL 3220977 (D. Colo. June 3, 2016); Silva v. Coast to Coast Fin. Solutions,
Inc., 2015 WL 6172131 (D. Colo. Mar. 30, 2016); Fisher v. Stellar Recovery, Inc., 2016
2
While broad discretion is involved in assessment of attorneys’ fees, that discretion is
somewhat cabined by what others in this district have also found to be reasonable given that
the Court looks to the market rate in the local community. White, 2012 WL 899280, at *2.
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WL 852815 (D. Colo. Mar. 3, 2016); Sandoval v. Stellar Recovery, Inc., 2016 WL
74941 (D. Colo. Jan. 7, 2016); Harper v. Stellar Recovery, Inc., 2015 WL 7253239 (D.
Colo. Nov. 16, 2015).
Accordingly, this Court finds Mr. Larson’s hourly rate of $300 reasonable in the
instant case.
2.
Number of Reasonable Hours
Plaintiff’s counsel, Mr. Larson claims that he expended 117.1 hours on this
matter. (ECF No. 71 at 10.) Defendant argues that the time expended by counsel on
this matter is excessive in light of the relative amount in controversy and the relative
simplicity of the case. (ECF No. 67 at 4–5.) Defendant requests a reduction of fees
requested by Plaintiff’s counsel for “tasks and circumstances that were unnecessary or
that were created by counsel” and for “tasks that were clerical in nature or would require
a skilled practitioner far less time than the amount billed.” (Id. at 6.) Because of Mr.
Larson’s extensive experience litigating routine FDCPA cases, Defendant argues that “it
is their routine nature that allows counsel to capitalize on the economies of scale,
thereby theoretically reducing expenditures.” (Id. at 4.) Lastly, Defendant argues that
the attorneys’ fees requested must be reduced as they are not proportional to the
circumstances of the case and the “case cries out for a downward adjustment of the
lodestar amount.” (Id. at 11–13.) Plaintiff replies that “FDCPA attorney’s fees are never
proportional to the amounts awarded,” that his “records are sufficiently detailed,” and
that the hours billed were reasonable. (ECF No. 71 ¶¶ 2, 10–11, 14, 21–23.)
The Court agrees with Defendant that Plaintiff’s fee request is excessive. The
undersigned has previously cited U.S. District Judge R. Brooke Jackson’s September
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24, 2012 Order on Mr. Larson’s Motion for Attorneys’ Fees as helpful to the present
analysis. See Sanchez v. Stellar Recovery, Inc., 2015 WL 3646893 (D. Colo. June 11,
2015). In his Order, Judge Jackson notes that Mr. Larson should be able to efficiently
litigate FDCPA matters:
This is not complex litigation. Mr. Larson has filed an
astonishing number of these cases in this district alone . . . .
Mr. Larson, as apparently one of the leading specialists in
this type of litigation, deserves to be reasonably
compensated. However, the fact is that this is high volume,
small dollar, non-complex litigation. The efficiencies of scale
that Mr. Larson has achieved, to his credit, sometimes
enable him . . . to “investigate” the facts, prepare pleadings,
and negotiate settlements with small investments of time.
Such was the case here.
Ellis v. Midland Credit Mgmt., Inc., 2012 WL 4356251, at *4 (D. Colo. Sept. 24, 2012).
The Court finds some of Mr. Larson’s time entries in this matter to be excessive.
For example, Mr. Larson spent 4.1 hours drafting six deposition notices; 1.2 hours
drafting “stock” discovery requests; 4 hours drafting the instant motion; and 4 hours
drafting the instant motion’s reply brief. (ECF No. 59-1; ECF No. 67 at 10.) Defendant
claims “Plaintiff’s counsel uses economies of scale for the purpose of reducing costs
and expenses.” (ECF No. 67 at 10.) Defendant contends that in parallel litigation
against Defendant, Plaintiff sent “similar stock discovery requests” and his review of
Defendant’s disclosure documents should be reduced as the documents were “nothing
unfamiliar to Plaintiff’s counsel.” (ECF No. 67 at 10.) Further, Mr. Larson’s time spent
reviewing brief docket entries or completing clerical tasks, such as his review of the
return of service, review of an unopposed motion for extension of time, and mailing
deposition notices, also warrant close scrutiny. (ECF No. 59-1 at 2, 8, 9.)
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Mr. Larson evidently takes advantage—as he should—of the similar legal issues
that arise in many FDCPA matters through the use of form pleadings, motions, and
discovery requests. These “efficiencies of scale” should allow Mr. Larson to spend a
nominal amount of time on such routine matters. Ellis, 2012 WL 4356251, at *8. Mr.
Larson’s billings, however, do not reflect this reality.
As noted earlier, Defendant contends that Mr. Larson billed for tasks that are
purely “clerical in nature.” (ECF No. 67 at 6.) Although Mr. Larson did not charge for
many of the purely administrative tasks, such as filing documents with the Court, there
are a few entries that appear to be for tasks that could have been performed by clerical
staff. (See generally ECF No. 59-1.) For example, there are numerous entries stating
“email to defense counsel re case” or “phone call to defense counsel re case” without
any indication that there was any substantive message involved.3 (See generally ECF
No. 59-1.) These e-mails could have been administrative in nature, such as scheduling
a time with defense counsel to conference in a call to the Court.4 It is Plaintiff’s burden
to substantiate his bills by presenting meticulous time records that show how his time
was spent. Case, 157 F.3d at 1250. Similarly, Plaintiff charged 0.2 hours for placing a
phone call to a court reporter in Minnesota regarding the depositions of Defendant’s
witnesses, and charged 0.2 hours for time spent scheduling airfare to Minnesota to take
3
As opposed to more detailed entries, such as “emails to defense counsel re motion to
strike,” and “email to defense counsel re re-opening deposition.” (ECF No. 71-6 at 1; ECF No.
59-1 at 13.)
4
In fact, on November 25, 2015, Plaintiff charged .4 hours for sending two e-mails (four
sentences in total length combined) to Defendant regarding contacting Judge Wang’s chambers
to determine available discovery dispute hearing dates for the instant case and parallel litigation
involving Defendant. (ECF No. 59-1 at 6; ECF No. 71-2 at 1-2.)
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those depositions. (ECF No. 59-1 at 9.) “[P]urely clerical or secretarial tasks should not
be billed at a paralegal [or associate] rate, regardless of who performs them.” Missouri
v. Jenkins by Agyei, 491 U.S. 274, 288 n.10 (1989).
The Court accordingly finds that Plaintiff’s fee request is excessive, and warrants
a 20% reduction to account for Mr. Larson’s inefficiencies in handling this matter and for
inappropriately charging for clerical tasks. While the Court must specify the reasons
underlying its fee award, “[a] general reduction of hours claimed in order to achieve
what the court determines to be a reasonable number is not an erroneous method, so
long as there is sufficient reason for its use.” McInnis v. Fairfield Communities, Inc., 458
F.3d 1129, 1147 (10th Cir. 2006) (quoting Mares, 801 F.2d at 1203). As discussed
above, this reduction accounts for any needless and otherwise unnecessary time spent
drafting and reviewing routine documents, and completing administrative tasks.
Hensley, 461 U.S. at 434. Applying the 20% reduction, the reasonable billable hours
amounts to 93.68.
Multiplying the number of hours reasonably expended (93.68) by the reasonable
hourly rate ($300) results in a lodestar fee award of $28,104. The Court further finds
that no special circumstances exist here to warrant adjustment of the lodestar amount.
Anchondo v. Anderson, Crenshaw & Assocs., LLC, 616 F.3d 1098, 1102 (10th Cir.
2010) (stating that the lodestar amount is “presumptively reasonable”).
The Court will therefore award Plaintiff $28,104 in attorneys’ fees, rather than
$35,130 as Plaintiff’s Motion for Attorneys’ Fees requests.
III. CONCLUSION
For the reasons set forth above, the Court ORDERS as follows:
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1.
Defendant’s Motion for Review of Clerk’s Taxing of Costs (ECF No. 68) is
DENIED;
2.
Plaintiff’s Motion for Attorneys’ Fees (ECF No. 59) is GRANTED in part; and
3.
Plaintiff is AWARDED $28,104 in attorneys’ fees.
Dated this 23rd day of November, 2016.
BY THE COURT:
William J. Martínez
United States District Judge
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