Sure Fill & Seal, Inc. v. GFF, Inc.

Filing 188

ORDER granting 181 Motion for attorney fees. See order for details. Signed by Judge Elizabeth A. Kovachevich on 3/31/2011. (SN)

Sure Fill & Seal, Inc. v. GFF, Inc.

Doc. 188

UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION

SURE FILL & SEAL, INC., et al.,
Plaintiff's, Case No. 8:08-CV-882-T-17-TGW

v.

GFF, INC.,
Defendant.

ORDER ON DEFENDANT'S MOTION FOR ATTORNEYS' FEES

This cause is before the Court on Defendant's, GFF, Inc., Motion for Attorneys' Fees
(Doc. 181) and Plaintiffs', Sure Fill & Seal, Inc. et al., response thereto (Doc. 187). For the

reasons set forth below. Defendant's Motion for Attorneys' Fees is GRANTED.

BACKGROUND AND PROCEDURAL HISTORY

The original lawsuit between Plaintiffs ("Sure Fill") and Defendant ("GFF"), involving a
breach of contract claim regarding the purchase and installation of a machine sold by Sure Fill to GFF, was resolved in December 2009 by a Settlement Agreement and Mutual Release ("Settlement Agreement"). (Doc. 158. Doc. 176). Soon thereafter, the parties notified this Court that "the parties have agreed to terms of settlement which should be consummated on or
before January 11,2010." (Doc. 156). According to the terms of the Settlement Agreement:

1

Dockets.Justia.com

1. Consideration. As of the date of this Settlement Agreement, [the Defendant!

agrees to pay [the Plaintiffs] the sum of $50,000.00 (Fifty Thousand US Dollars), and each party hereby shall dismiss its respective complaints, counterclaims and prayers for reliefin the Action, and shall release forever any and all claims against each other arising out of the subject matter of the Action, on the terms and
conditions stated in this Settlement Agreement.

(Doc. 158-1). Plaintiffs received a $50,000.00 check from Defendant on January 11, 2010 (Doc.
158-1). While counsel for Plaintiffs acknowledged in correspondence dated February 4. 2010
that the check had been cashed and "the settlement has been consummated," he was unwilling to

dismiss Plaintiffs' claims against Defendant. (Doc. 158-3).

As a result. Defendant filed a Motion to Enforce the Settlement Agreement on February 24. 2010. alleging that Plaintiffs refused to dismiss their claims in accordance with the

Settlement Agreement. (Doc. 158). In response. Plaintiffs filed a "Memorandum in Opposition
to Motion to Quash and Motion to Extend Time to Dismiss the Case" ("Motion to Extend

Time"), arguing that they were not refusing to dismiss their claims, but instead sought "to keep
the action administratively open for the resolution of their Motion for Sanctions." (Doc. 159).

Curiously, as noted by Magistrate Wilson in his July 6. 2010. Report and Recommendation, there
was no Motion for Sanctions pending at the time of the Settlement Agreement or when Plaintiffs

filed the Motion to Extend Time. (Doc. 176). Plaintiffs finally filed the aforementioned Motion for Sanctions on March 12, 2010, seeking over three-quarters of a million dollars from Defendant for its allegedly frivolous counterclaims and defenses as well as allegedly
stonewalling Plaintiffs' discovery efforts. (Doc. 162).
In the subsequent hearing conducted on the three motions (Plaintiffs' Motion to Extend

lime and Motion for Sanctions and Defendant's Motion to Enforce the Settlement Agreement), Magistrate Wilson warned Plaintiffs that "although sanctions payable to the court may not be

2

waived in a settlement, the plain language of the Settlement Agreement barred monetary

sanctions payable to the plaintiffs." (Doc. 176). Magistrate Wilson made clear at the same hearing that, based on his experience in the case. Plaintiffs were primarily responsible for unnecessarily protracting the litigation in this case and that if sanctions were warranted, he
"would recommend that they be assessed against the plaintiffs, not the defendants." (Doc. 176).

Furthermore. Magistrate Wilson informed Plaintiffs at the hearing (Doc. 173), and then repeated
in his Report and Recommendation, that "ifthe plaintiffs pursue this frivolous motion further,
the defendant should be awarded its attorneys' fees and costs in connection with the enforcement

ofthe Settlement Agreement."' (Doc. 176). Magistrate Wilson concluded his Report and
Recommendation by recommending that this Court deny Plaintiffs' Motion to Extend the Time to Dismiss the Case and Motion for Sanctions, and grant Defendant's Motion to Enforce the
Settlement Agreement. (Doc. 176)."

On August 4, 2010 this Court adopted Magistrate Wilson's Report & Recommendation,
and dismissed the case at hand. (Doc. 180). Defendant filed the current Motion for Attorneys' Fees on August 18. 2010. indicating it would withdraw its motion in the event that Plaintiffs did

not file an appeal. (Doc. 181). Plaintiffs filed notice of appeal on September 2, 2010. (Doc.
184).

Magistrate Wilson further opined thai "the defendant reasonably believed that the Settlement Agreement and their
payment of $50,000 to the plaintiffs would bring an end to the litigation. However, the plaintiffs have instead

pursued these stale and frivolous contentions, thereby causing the defendant to incur unnecessarily further attorneys' fees and costs. The Motion for Sanctions, moreover, appears to be an unmeritorious attempt lo subvert the terms of the Settlement Agreement. Therefore, an award of attorneys' fees and costs to the defendant would be appropriate if the plaintiffs continue to pursue this matter." (Doc. 176). " Once more. Magistrate Wilson recommended "that the defendant be awarded its reasonable attorneys' fees and
costs incurred in connection with enforcement of Ihe Settlement Agreement if the plaintiffs continue pursuit of the frivolous Motion for Sanctions." (Doc. 176).

"GFF only intends to pursue its attorneys' fees if Plaintiffs follows [sic] through with their threats and Ille an appeal, which would necessitate more unnecessary work on this matter." (Doc. 181). "If Plaintiffs do not file an
appeal . . . GFF intends to withdraw this motion." (Doc. 181).
3

DISCUSSION

Defendant argues in the present motion that it is entitled to attorneys' fees in connection
with its meritorious enforcement of the parties' Settlement Agreement pursuant to the following
terms of Paragraph 7 of the agreement:
Attorneys' Fees and Costs. The Parties shall bear their own attorneys' fees and

costs incurred in connection with the Action, including those incurred for drafting and review of this Settlement Agreement, and for any action needed to complete performance of this Settlement Agreement. Should anyparty hereto institute any

action orproceeding to enforce any provision ofthis Settlement Agreement, or for damages by reason of any breach of any provision of this Settlement Agreement,
or for a declaration of such parly's rights or obligations hereunder, orfor any other judicial remedy, theprevailingparty in such matter shall be entitled to recoverfrom the losing party all reasonable attorneys'fees, costs and expenses, including expert witness fees, incurred by the prevailing party in such action or proceeding. (Doc. 158-1) (emphasis added). The interpretation of the Settlement Agreement is governed by-

Florida contract law4, under which the interpretation of the agreement is a question of law for the
court, and "[w]orcls ... are to be given their plain and ordinary meaning." Schwartz v. Fl. Bd. of Regents. 807 F.2d 901. 905 (11th Cir. 1987). Defendant by filing its February 24, 2010 Motion to Enforce the Settlement Agreement (Doc. 158). instituted a proceeding to require Plaintiffs to
dismiss their claims as they had agreed to in the Settlement Agreement. This Court's August 4, 2010. Order Adopting Report and Recommendation granted that motion and dismissed the cause of action in its entirety. (Doc. 180). Thus, Defendant prevailed on its Motion to Enforce the

Settlement Agreement, and in accordance with the plain language of Paragraph 7, is "entitled to
recover from the losing party all reasonable attorneys' fees" incurred in relation to its successful
enforcement of the Settlement Agreement. (Doc 158-1).

4Paragraph 8 ofthe Settlement Agreement provides that the "rights and obligations of the Parties hereunder shall be
construed and enforced in accordance with, and governed by, the laws of Ihe Slate of Florida." (Doc. 158-1).

The two arguments that Plaintiffs advance in opposition to awarding Defendant its
reasonable attorneys' fees are unsupported by both the facts of this case and the law. First, Plaintiffs contend that "[l]he instant Motion is based on a dispute not arising from the Settlement

Agreement." (Doc. 187, p. 4). Instead of using its response to argue on the merits of
Defendant's claim for attorneys' fees. Plaintiffs choose to treat the response as a springboard to inexplicably launch into another attempt to advance the same argument for sanctions that they previously lost on in this Court's August 4. 2010, Order Adopting Report and Recommendation.
Forexample. Plaintiffs once again argue that "court-ordered sanctions are not generally within the scope of a settlement agreement." (Doc. 187. p. 5). Plaintiffs' determined pursuit of this
failed argument for sanctions despite this Court's admonishment in its August 4, 2010 Order that they "are not cognizable or are meritless" (Doc. 180) is simply unrelated to the motion at hand.
Despite Plaintiffs' argument to the contrary, it is clear that Defendant's Motion for Attorneys' Fees originates directly from Paragraph 7 of the Settlement Agreement. In fact.
Plaintiffs seem to come full circle by the end of their response to concede that "[t]he current

dispute arose out of the Settlement Agreement." in order to justify their conclusory argument that
it is they who are in fact entitled to reasonable fees for defending the motion. (Doc. 187, p. 6).

Plaintiffs contend that the instant motion is not an attempt to enforce the Settlement Agreement,
when in fact it is exactly that - the Defendant brought the motion to enforce Paragraph 7 of the

Settlement Agreement in order to recuperate its reasonable attorneys' fees for its previous successful Motion to Enforce the Settlement Agreement.
Plaintiffs' most coherent argument is that Defendant's Motion cannot be disposed of at this time due the pending appeal, as the appeal will address which party is considered the

"prevailing party." and it would be "premature for the Court to attempt to conclude that either
5

parly would be entitled to the fees contemplated by [the Settlement Agreement]." (Doc. 187. p.
3). Ordinarily, the phrase"prevailing party" is a legal term of art defined as "[a] party in whose favor a judgment is rendered, regardless of the amount of damages awarded . .. [a]lso termed
successful party. " Buckhannon Bd. & Care Home. Inc. v. W. Va. Dept. ofHealth & Human
Res.. 532 U.S. 598, 603 (2001) (citing Black's Law Dictionary 1145 (7th ed. 1999)). Thus, "a

·prevailing party' is one who has been awarded some reliefby the court." Buckhannon, 532 U.S.
at 603. This Court rendered judgment in the favor of the Defendant on its prior Motion to Enforce the Settlement Agreement and, as a result, the Defendant was awarded the relief of

having the case dismissed by this Court's August 4. 2010. Order Adopting Report and
Recommendation. (Doc. 180). Thus, for the purposes of Paragraph 7 of the Settlement Agreement, the Defendant qualifies as a prevailing party.
Based on the current record, this Court finds that Defendant is entitled to its reasonable

attorneys' fees in enforcing the Settlement Agreement. If Defendant prevails on appeal, both sides are directed to initiate discussions to determine the appropriate amount to be awarded. In the event that the parties fail to agree, Defendant is directed to file the appropriate motion for the assessment of such fees with this Court. If Ihe Plaintiffs prevail, the fee issue should become
moot.

Accordingly, it is ORDERED that Defendant's Motion for Attorneys' Fees (Doc. 181) be
GRANTED as far as liability but not amounl to be paid.

<P>/ir& /$hy£y
/**- 2z& //.

&?££>&#£&& /&sihe.<L&

Copies to: All parties and counsel of record.