Mortensen et al v. Bank of America NA et al

Filing 88

ORDER granting 73 Motion for Attorney Fees. Ordered by Judge Clay D. Land on 04/24/2012.(aaf)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
ATHENS DIVISION
ROBERT
MORTENSEN
MORTENSEN,

and

LINDA *
*

Plaintiffs,
*
vs.

CASE NO. 3:10-CV-13 (CDL)
*

BANK OF AMERICA, N.A.,
*
Defendant.
*
O R D E R
After
Defendant

the

Court

Bank

of

granted
America,

summary
N.A.

judgment

(“BOA”)

in

and

favor

denied

of
the

Plaintiffs’ motion for reconsideration of that order, the Clerk
of

Court

taxed

costs

against

Plaintiffs

Robert

and

Linda

Mortensen (“Plaintiffs” or “the Mortensens”) in the amount of
$1,358.86 (ECF No. 87).

The Court must now decide whether BOA

should also recover its attorney’s fees pursuant to Federal Rule
of Civil Procedure 11, whether those fees should be assessed
against Plaintiffs’ attorneys, and whether the costs in this
action

should

also

be

instead of Plaintiffs.

assessed

against

Plaintiffs’

attorneys

For the reasons set forth below, BOA’s

Motion for Attorney’s Fees and Expenses (ECF No. 73) is granted.
BOA

is

awarded

attorney’s

fees

to

be

paid

by

Plaintiffs’

counsel, Henry N. Portner and Kristine R. Tarrer, in the amount
of $17,646.50.

The Court also finds that BOA should recover its

costs in the amount of $1,358.86, as previously determined by
the Clerk, with $1,354.56 of the

costs assessed against

Mr.

Portner and Ms. Tarrer, and $4.30 assessed against Plaintiffs.
DISCUSSION
BOA

seeks

to

recover

its

attorney’s

fees

and

expenses

pursuant to Federal Rule of Civil Procedure 11 (“Rule 11”).1
Def.’s Mot. for Att’ys Fees & Expenses ¶¶ 11-12, ECF No. 73;
Def.’s Reply in Supp. of Mot. for Atty’s Fees & Expenses 4-7,
ECF No. 83.

Any suggestion by the Mortensons that BOA does not

rely on Rule 11 as a basis for recovering its attorney’s fees is
not supported by the record.
whether

BOA

should

under Rule 11.

recover

Therefore, the Court will analyze
its

attorney’s

fees

and

expenses

Preliminarily, the Court finds that the amount

of costs taxed by the Clerk against the Plaintiffs, $1,358.86,
is supported by the record and authorized under the applicable
law.

Therefore,

the

Court

does

not

disturb

that

amount.

However, as explained in the following discussion, the Court
finds that most of those costs should be borne by Plaintiffs’
counsel pursuant to Rule 11.

1

BOA alternatively contends it is entitled to attorney’s fees under
the note and the security agreement for the mortgage that formed the
basis for this lawsuit.
Because BOA did not sue to enforce these
instruments in this action, the attorney’s fees provisions in those
documents are not enforceable here.
O.C.G.A. § 13-1-11; Boddy
Enters., Inc. v. City of Atlanta, 171 Ga. App. 551, 553, 320 S.E.2d
374, 375-76 (1984).

2

I.

The Recoverability of Attorney’s Fees and Expenses
BOA argues that the Mortensens’ claims had no basis in law

or fact, and therefore, BOA should be awarded its attorney’s
fees and expenses.

Under Rule 11, an attorney who presents a

pleading to a court “certifies that to the best of the person's
knowledge,

information,

and

belief,

formed

after

an

inquiry

reasonable under the circumstances” that the pleading “is not
being presented for any improper purpose, such as to harass,
cause

unnecessary

litigation”

and

delay,

that

or

“the

needlessly

claims,

increase

defenses,

the

and

cost

other

of

legal

contentions are warranted by existing law or by a nonfrivolous
argument for extending, modifying, or reversing existing law or
for establishing new law.”
notice

and

a

reasonable

Fed. R. Civ. P. 11(b).
opportunity

to

respond,

“If, after
the

court

determines that Rule 11(b) has been violated, the court may
impose an appropriate sanction on any attorney, law firm, or
party

that

violation.”2

violated

the

rule

or

is

responsible

for

the

Fed. R. Civ. P. 11(c)(1).

The Eleventh Circuit Court of Appeals has held that three
types of conduct warrant Rule 11 sanctions: “(1) when a party
files a pleading that has no reasonable factual basis; (2) when
the party files a pleading that is based on a legal theory that
2

“The court must not impose a monetary sanction . . . against a
represented party for violating Rule 11(b)(2)[.]”
Fed. R. Civ. P.
11(c)(5)(A).

3

has no reasonable chance of success and that cannot be advanced
as a reasonable argument to change existing law; and (3) when
the

party

purpose.”

files

a

pleading

in

bad

faith

for

an

improper

Jones v. Int'l Riding Helmets, Ltd., 49 F.3d 692, 694

(11th Cir. 1995) (internal quotation marks omitted).

The goal

of Rule 11 sanctions in the context of a frivolous complaint is
to deter the filing of frivolous claims while not chilling the
attorney's

legitimate

“enthusiasm

factual or legal theories.”
F.2d

1491,

1496

(11th

or

creativity

in

pursuing

McGinnis v. Ingram Equip. Co., 918

Cir.

1990)

(internal

quotation

marks

omitted).
In th[e] [Eleventh] [C]ircuit, a court confronted with
a motion for Rule 11 sanctions first determines
whether the party's claims are objectively frivolousin view of the facts or law-and then, if they are,
whether the person who signed the pleadings should
have been aware that they were frivolous; that is,
whether he would have been aware had he made a
reasonable inquiry. If the attorney failed to make a
reasonable inquiry, then the court must impose
sanctions despite the attorney's good faith belief
that the claims were sound.
Jones, 49 F.3d at 695 (citations omitted).
Preliminarily, it is clear that BOA gave counsel for the
Mortensens ample opportunity to withdraw the Mortensens’ claims.
On October 27, 2010, BOA’s counsel sent the Mortensens’ counsel
a letter pursuant to Rule 11, requesting that the Mortensens
dismiss

the

action

against

BOA

because

clear

evidence

established that BOA had defenses that barred the claims against

4

it and that the Mortensens’ allegations in their Complaint were
deficient

and

only

designed

defaulted property.

to

delay

foreclosure

of

the

Def.’s Mot. for Attorney’s Fees & Expenses

Attach. 1, Certification in Supp. of Bank of Am., N.A.’s Mot.
for Att’ys Fees & Expenses [hereinafter Gilroy Certification]
Ex. A., Letter from T. Trumble to H. Portner & K. Tarrer (Oct.
27,

2010),

ECF

No.

73-2.

BOA

stated

that

the

evidence

established that the Mortensens did not have a right to a loan
modification and, in spite of BOA’s requests, the Mortensens’
counsel failed to provide evidence of any wrongdoing by BOA.
Id. at 3.

Despite BOA’s counsel’s request for the Mortensens to

voluntarily dismiss their claims against BOA, the Mortensens’
counsel did not do so.
On

February

another

Rule

1,

11

2011,

letter

meritless lawsuit.

BOA

sent

the

requesting

Mortensens’

that

they

counsel

dismiss

the

Gilroy Certification Ex. B., Letter from T.

Trumble to H. Portner & K. Tarrer (Feb. 1, 2011) at 3, ECF NO.
73-3

(“Regardless

of

numerous

requests,

you

have

failed

to

provide any documentation or evidence that demonstrates Bank of
America’s

failure

to

properly

follow

the

terms

of

the

BOA

Security Deed and failed to properly follow Georgia law as to
the

foreclosure

referred

to

similar

case

the

procedure.”).
Southern

brought

by

In

District
the

the
of

letter,

Alabama’s

Mortensens

5

BOA’s

counsel

order

against

BOA

in

a

that

dismissed all claims, finding that BOA was under no duty to
modify

the

Mortensens’

loan

and

the

Mortensens’

claims cross the borders of absurdity.”
at

3

(“[Y]ou

have

filed

a

second

“fraud-based

Id. at 2; see also id
Amended

Complaint

that

completely misstates the testimony of Mr. Wilson and reiterates
the same claims made in the dismissed Alabama lawsuit.”).

The

Mortensens’

not

counsel

again

ignored

BOA’s

request

and

did

dismiss the action against BOA.
On

February

24,

2011,

BOA’s

counsel

reiterated

its

objection to the lawsuit and the Mortensens’ counsel’s failure
to answer the prior Rule 11 letters.

Gilroy Certification Ex.

C., Letter from T. Trumble to H. Portner & K. Tarrer (Feb. 24,
2011), ECF No. 73-4.

Despite this letter’s final request for

dismissal of the action, the Mortensens’ counsel did not dismiss
it.
After giving the Mortensens’ counsel ample time to evaluate
their clients’ claims and hearing no response to the Rule 11
letters, BOA filed its summary judgment motion on July 15, 2011.3
Mot. for Summ. J., ECF No. 45.

The Court granted BOA’s summary

judgment motion, Mortensen v. Bank of Am., N.A., No. 3:10-CV-13
3

Prior to filing a Rule 11 sanctions motion, the moving party must
comply with the “safe harbor” provision in Rule 11(c)(2), requiring
the moving party to provide twenty-one days’ notice to the opposing
party of the challenged conduct. Peer v. Lewis, 606 F.3d 1306, 1315
(11th Cir. 2010) (recognizing that Rule 11(c)(2)’s “safe harbor”
provision allows “an attorney who violates Rule 11 to correct the
alleged violation within twenty-one days without being subject to
sanctions.”).

6

(CDL), 2011 WL 5593810 (M.D. Ga. Nov. 17, 2011) [hereinafter
Summ.

J.

Order],

and

denied

reconsideration

of

that

order,

Mortensen v. Bank of Am., N.A., No. 3:10-CV-13 (CDL), 2011 WL
6740742 (M.D. Ga. Dec. 23, 2011).
The Court finds that the Mortensens’ action against BOA was
objectively frivolous.

To establish liability for their claims

of fraud, conspiracy to commit fraud, fraudulent inducement, and
misrepresentation

under

Georgia

law,

the

Mortensens

required to show a false representation by BOA.

were

The Mortensens

did not point to any evidence showing that BOA made any false
representation, and in fact they admitted in their depositions
that BOA never promised them a loan modification orally or via
the loan documents, contradicting the alleged basis for their
action.

See

Summ.

J.

Order

at

*5-*7.

Additionally,

the

Mortensens asserted a claim under the Fair Credit Reporting Act,
15 U.S.C. § 1681 et seq., specifically § 1681s-2(a), which does
not provide a private right of action under the circumstances in
this case.

See Summ. J. Order at *7.

The Mortensens also

pursued a claim for defamation and false light based on BOA’s
alleged false statements to credit reporting agencies, but they
failed to produce any evidence that BOA mad any false statements
to the agencies.

See id.

Next, the Mortensens made a claim for

wrongful foreclosure alleging that BOA did not comply with the
Georgia

foreclosure

notice

requirements,

7

yet

evidence

showed

that BOA provided written notice in compliance with Georgia law,
and

the

Mortensens

even

signed

for

received them via certified mail.
Mortensens
Unfair

these

notices

See id. at *8.

when

they

Finally, the

threw in a claim under the Florida Deceptive and

Trade

Practices

Act,

Fla.

Stat.

§

501.204

et

seq.,

without asserting why Florida law applies to this action and
what provision BOA allegedly violated.
*8.

Moreover,

Mortensens

in

their

acknowledged

motion

their

See Summ. J. Order at

for

own

reconsideration,

uncertainty

as

the

to

the

propriety of their claims against BOA when they stated, “In
retrospect, the Plaintiff appears to have sued the wrong party.”
Pls.’ Am. Mot. for Recons. 7, ECF No. 70.
The

Court

finds

that

the

Mortensens’

counsel

knew,

or

certainly should have known, from the outset that no plausible
factual or legal
against

BOA.

basis

Even

existed for the claims they asserted

if

the

Mortensens’

counsel

was

somehow

justified in filing the action against BOA originally, with the
expectation that discovery would confirm BOA’s liability, during
discovery

counsel

diligence

that

could

have

Plaintiffs’

easily
claims

determined
lacked

with

merit.

minimal
Counsel

apparently did not reach that conclusion until their motion for
reconsideration.

Moreover,

after

being

notified

three

times

that no basis existed for the frivolous action, counsel still
did not dismiss this case.

8

Based

on

the

foregoing,

the

Court

sanctions are required in this case.

finds

that

Rule

11

Sanctions in this case

will be imposed solely on Mr. Portner and Ms. Tarrer, as counsel
for the Mortensens, and not on the Mortensens themselves.
Fed.

R.

Civ.

monetary

P.

sanction

11(c)(5)(A)
.

.

.

violating Rule 11(b)(2)”).

(“The

against

court
a

must

not

represented

See

impose
party

a

for

Accordingly, the Court finds the

following sanction appropriate:

Mortensens’ counsel shall pay

BOA’s reasonable fees and expenses incurred after October 27,
2010, the date BOA first put Mortensens’ counsel on notice that
it would seek Rule 11 sanctions if they did not dismiss the
action.4

The

Court

will

next

address

the

amount

of

the

sanctions.
II.

The Amount of Attorney’s Fees and Expenses5
BOA has submitted a detailed accounting of its attorney’s

fees that provides the date, the timekeeper, the time recorded,
and a description of the activity as required by Local Rule
4

Federal Rule of Civil Procedure 11(c)(4) provides:
A sanction imposed under this rule must be limited to what
suffices to deter repetition of the conduct or comparable
conduct by others similarly situated.
The sanction may
include . . . an order directing payment to the movant of
part or all of the reasonable attorney’s fees and other
expenses directly resulting from the violation.
5
As previously noted, the Court finds that the amount of the costs
taxed by the Clerk, $1,358.86, is appropriate; however, the Court
determines that those costs incurred after October 27, 2010, which
amounts to $1,354.56, shall be paid by Plaintiff’s counsel pursuant to
Rule 11, and Plaintiff shall only be responsible for the costs before
October 27, 2010 pursuant to Rule 54(d)(1), which amount is $4.30.
The Court makes no additional award of costs pursuant to Rule 11.

9

54.1.

Gilroy Certification ¶¶ 12-20; Gilroy Certification Ex.

D, Itemized Bills, ECF No. 73-5.

See M.D. Ga. R. 54.1.

BOA’s

submissions reflect more than $33,000 in fees incurred to defend
this frivolous action.
hourly rates:

Those fees are based on the following

$195 per hour for attorney time and $145 per hour

for paralegal time.6

The Court has reviewed the following: BOA’s

billing statements; counsel’s affidavit in support of attorney’s
fees and litigation expenses, Bill of Costs Attach 1. Gilroy
Aff., ECF No. 76-1; counsel’s certification; and the Mortensens’
response to BOA’s motion.
A Court may award attorney’s fees solely by looking to the
record.

Norman v. Hous. Auth. of City of Montgomery, 836 F.2d

1292, 1303 (11th Cir. 1988).
attorney’s

fees,

the

Court

To set the amount of recoverable
must

first

determine

a

lodestar,

which “is determined by multiplication of a reasonable hourly
rate

times

hours

reasonably

expended.”

Id.

at

1302.

“A

reasonable hourly rate is the prevailing market rate in the
relevant

legal

community

for

similar

services

by

lawyers

reasonably comparable skills, experience, and reputation.”

of
Id.

at 1299.

Reasonable hours are presented when the fee applicant

exercises

“‘billing

judgment’”

and

6

excludes

any

“‘excessive,

Work by paralegals is recoverable as part of an attorney's fees award
only to the extent that the paralegal performs work traditionally done
by an attorney. Jean v. Nelson, 863 F.2d 759, 778 (11th Cir. 1988).
The descriptions for the work performed by the paralegals in this case
meet this standard.

10

redundant
sought.

or

otherwise

unnecessary’”

hours

from

the

amount

Id. at 1301 (quoting Hensley v. Eckerhart, 461 U.S.

424, 434, 437 (1983)).
The Mortensens have not challenged the reasonableness of
the attorney’s fees, and the Court finds that the amount of fees
sought in this case is reasonable and supported by the record.
The lodestar for fees after October 27, 2010 is $17,646.50.
Court

finds

no

basis

for

reducing

BOA’s

reasonable

particularly given BOA’s success on all counts.
461

U.S.

results,

at

435

his

(“Where

attorney

[the

has

recover

should

party]

a

fees,

See Hensley,

obtained
fully

The

excellent

compensatory

fee.”).
In sum, the Court finds that under the circumstances in
this case, Mr. Portner and Ms. Tarrer shall pay BOA $19,001.06,
which includes $17,646.50 in attorney’s fees and $1,354.56 in
costs incurred after October 27, 2010, as reasonable fees and
expenses

attributable

to

Mr.

Portner

and

Ms.

Tarrer’s

sanctionable conduct.
CONCLUSION
For the forgoing reasons, BOA’s Motion for Attorney’s Fees
and Expenses (ECF No. 73) is granted to the extent provided for
in this Order.

The Clerk is directed to amend the Judgment to

reflect that BOA shall recover attorney’s fees and costs in the
amount of $19,001.06 against Henry N. Portner and Kristine R.

11

Tarrer, jointly and individually, and that BOA shall recover
costs

against

Plaintiffs,

the

Mortensens,

in

the

amount

of

$4.30, jointly and individually.7
IT IS SO ORDERED, this 24th day of April, 2012.
S/Clay D. Land
CLAY D. LAND
UNITED STATES DISTRICT JUDGE

7

The Court makes the award directly to BOA, instead of its attorneys
under the assumption that BOA has either paid those fees and expenses
or is obligated to pay them.

12