Plumbers and Pipefitters et al v. Brian Trematore Plumbing and Heating Inc
Filing
72
ORDER granting 66 Motion for Attorney Fees. Ordered by Judge Hugh Lawson on July 22, 2013. (mbh)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
MACON DIVISION
PLUMBERS AND PIPEFITTERS UNION
NO. 421 HEALTH AND WELFARE FUND,
et al.,
Civil Action No. 5:11-CV-221
Plaintiffs,
v.
BRIAN TREMATORE PLUMBING &
HEATING, INC.
Defendant.
ORDER
Before the Court is a Motion for Attorney’s Fees filed by Plaintiffs Plumbers
& Pipefitters Union No. 421 Health and Welfare Fund, et al. (“the Fund” or
“Plaintiffs”). In its Motion, Plaintiffs ask for reasonable attorney’s fees to be
awarded under ERISA § 502(g)(2). Plaintiffs’ Motion is analyzed below.
I.
PROCEDURAL HISTORY 1
In June 2011, Plaintiffs, a Fund which holds assets for employee benefits
under ERISA, filed this action against Defendant Brian Trematore Plumbing &
Heating, Inc. (“Defendant”) alleging that there were outstanding contributions that
Defendant had failed to pay to the Fund for work completed on a certain
1
The Court does not find it necessary at this point in the litigation to outline an
exhaustive factual background of this case. The factual background was set out
in its entirety in this Court’s order on Plaintiffs’ Motion for Summary Judgment.
See Doc. 37.
construction project in Raleigh, North Carolina. The alleged deficiency was for a
total of $82,110.09.
Plaintiffs moved for summary judgment in May 2012, alleging that the
issue of the unpaid contributions should be resolved based on an application of
the Collective Bargaining Agreement (“CBA”) executed by the parties and the
United Association (“UA”) Constitution, which was referred to and incorporated
by the CBA. Plaintiffs argued that the plain text of these documents
demonstrated that Plaintiffs were entitled to fully recover the amount of unpaid
contributions they sought, as well as other relief to which they claimed to be
entitled under ERISA. Defendant disagreed with Plaintiffs’ interpretation of the
CBA and UA Constitution, arguing that the texts of these documents did not
support requiring contributions for the work performed.
After review, the Court granted summary judgment in part and denied it in
part. (Doc. 37.) The Court found that certain disputed work – specifically, Brian
Kroll’s construction of “box-outs”, union members’ performance of “dry” HVAC
work, and non-union members from L&A Mechanical and CLP Resources
completing covered work - fell within the text of the CBA and UA Constitution and
was considered “covered” work that required contributions. However, the Court
found that other disputed work - namely, clean-up work performed by Noza
Construction and Brian Kroll - was not covered under the CBA or UA Constitution
and contributions were not required. Based on these findings, the case
proceeded to a bench trial on these narrow issues: (1) as a matter of fact, how
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much of Kroll and Noza’s work was clean-up work not covered under the CBA or
UA Constitution, and (2) as a matter of law, did Defendant’s records for Kroll and
Noza meet the standard of sufficiency under ERISA § 209.
At the bench trial, Defendant admitted that there was not sufficient
evidence to establish how many hours Brian Kroll spent building box-outs as
compared to the hours he spent performing clean-up work. Therefore, without
any evidence to determine the appropriate apportionment of covered versus noncovered work he performed, the Court found as a matter of law that all hours
worked by Kroll on the construction project were to be considered covered hours.
Thus, the total number of hours worked by Kroll required contributions from
Defendant. As to Noza, the Court found that all hours worked by Noza
employees were worked on clean-up duties, which is not covered work. This
finding was reached based on direct testimony from Mr. Chris Leanzo, an on-site
project manager. Based on Mr. Leanzo’s testimony, the Court determined that
none of the hours worked by Noza Construction required contributions from
Defendant.
The Court ruled from the bench that Kroll’s hours were covered work and
Noza Construction’s hours were uncovered work. Based on these legal
conclusions, the parties were able to agree on all aspects of the amount of
damages, with the exception of attorney’s fees. The damages were calculated
according to ERISA § 502(g)(2). Under this provision,
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In any action under this subchapter by a fiduciary for or on behalf
of a plan to enforce section 1145 of this title in which a judgment
in favor of the plan is awarded, the court shall award the plan –
(A) the unpaid contributions,
(B) interest on the unpaid contributions,
(C) an amount equal to the greater of –
(i) interest on the unpaid contributions, or
(ii) liquidated damages provided for under the plan in an amount
not in excess of 20 percent (or such higher percentage as may be
permitted under Federal or State law) of the amount determined
by the court under subparagraph (A),
(D) reasonable attorney’s fees and costs in this action, to be paid
by the defendant, and
(E) such other legal or equitable relief as the court deems
appropriate.
29 U.S.C. § 1132(g)(2). Based on this statute, the damages on which the parties
agreed were as follows: $47,449.00 in unpaid contributions, $13,278.30 in
interest, and $13,278.30 in liquidated damages. This totals $74,005.60 in
damages, excluding attorney’s fees. The question of reasonable attorney’s fees
now falls to this Court.
II.
ATTORNEY’S FEES
a. Lodestar Approach
Section § 502(g)(2)(D) of ERISA authorizes a prevailing plan that receives
a judgment in its favor to receive an award of “reasonable attorney’s fees and
costs of the action.” 29 U.S.C. § 1132(g). However, the statute does not define
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what constitutes a “reasonable” fee. Without any direct statutory guidance from
ERISA, the Court turns to the lodestar approach, which consists of multiplying
the number of reasonable hours expended on the litigation by the reasonable
hourly rate. Loos v. Club Paris, LLC, 731 F. Supp. 2d 1324, 1329 (M.D. Fla.
2010) (citing Burlington v. Daque, 505 U.S. 557, 559-60, 112 S. Ct. 2638 (1992));
see also United Auto. Workers Local 259 v. Metro Auto Center, 501 F.3d 283,
290 (3rd Cir. 2007) (applying the lodestar approach to determine attorney’s fees
under ERISA § 502(g)(2)). The Supreme Court of the United States has called
this approach “[t]he most useful starting point for determining the amount of a
reasonable fee ....” Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S. Ct. 1933,
1939 (1983). The Court also described this calculation as “provid[ing] an
objective basis on which to make an initial estimate of the value of a lawyer’s
services.” Id.
i. Reasonable Hourly Rate
The first step of the lodestar approach is to determine the reasonable
hourly rate billed by the plaintiff’s attorneys. To determine the reasonable hourly
rate, the Court must ascertain “the prevailing market rate in the relevant legal
community for similar services by lawyers of reasonably comparable skills,
experience, and reputation.” Norman v. Housing Auth. of City of Montgomery,
836 F.2d 1292, 1299 (11th Cir. 1988). The party that seeks attorney’s fees bears
the responsibility of producing evidence that will demonstrate that the requested
rate is in line with prevailing market rates. Id. “The general rule is that the
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‘relevant market’ for purposes of determining the reasonable hourly rate for an
attorney’s services is the place where the case is filed.” Scelta v. Delicatessen
Support Servs., Inc., 203 F. Supp. 2d 1328, 1332 (M.D. Fla. 2002) (quoting Am.
Civil Liberties Union of Georgia v. Barnes, 168 F.3d 423, 437 (11th Cir. 1999)).
In this case, the case was initially filed in the Macon division of the Middle
District of Georgia. Plaintiffs’ counsel argues that Macon rates are not
appropriate in this case because “ERISA is a complicated, technical statute” and
“[e]xpertise in this area is required to adequately represent funds like the
Plaintiffs”. (Doc. 66, p. 4.) Plaintiffs’ counsel suggests that Atlanta billing rates are
more appropriate. For lead counsel, Mr. Eric Jon Taylor, the requested billing
rate is $475.00 for 2010, $500.00 for 2011, $525.00 for 2012, and $580.00 for
2013. For co-counsel Mr. Brett Montroy, the suggested billing rates are $210.00
in 2011, $220.00 in 2013, and $230.00 in 2013.
Defendant argues that Atlanta billing rates are not justified. In support of its
argument, Defendant submits the affidavit of Mr. Frank L. Butler, III (Doc. 67-1).
In his affidavit, Mr. Butler states that he practices in a Macon firm that specializes
in labor and employment law, including ERISA litigation. Based on this testimony,
the Court finds that non-local counsel was not necessary to represent Plaintiffs’
ERISA claim, and therefore, Atlanta billing rates are not justified for purposes of
calculating attorney’s fees.
The inquiry now turns to the appropriate Macon billing rates in a case of
this nature. Plaintiffs’ counsel did not submit any additional evidence about
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appropriate billing rates aside from Mr. Taylor’s own affidavit. Defendant did,
however, provide evidence of appropriate fees. In Mr. Butler’s, he testifies to
what he believes to be reasonable fees for Mr. Taylor and Mr. Montroy in the
Macon legal community taking into consideration Mr. Taylor’s and Mr. Montroy’s
experience, reputation, and skills. Mr. Butler suggests a fee of between $380.00
and $395.00 per hour for Mr. Taylor and between $170.00 and $200.00 per hour
for Mr. Montroy. Based on this evidence and on the Court’s own judgment and
experience, the Court finds the rates suggested by Mr. Butler to be reasonable
and the Court will employ those rates in this case. Thus, the rate to be used for
Mr. Taylor is $390.00 and the rate for Mr. Montroy is $190.00.
Mr. Butler’s affidavit did not address the prevailing rate for paralegals in the
relevant legal community. Plaintiffs’ counsel suggests a billable hourly rate of
between $160.00 and $180.00 per hour, but the Court finds this to be outside the
range of reasonable rates in the Macon area. Based on careful consideration of
Plaintiffs’ motion and the Court’s own expertise, judgment, and research into
prevailing market rates, the Court finds that the appropriate paralegal rate is
$75.00 per hour. See Broadcast Music, Inc. v. Northside Rivalry’s LLC, 5:13-cv36 (CAR), 2013 WL 3339037 at *4 (M.D. Ga. July 2, 2013) (Royal, J.) (finding a
rate of $75.00 per hour to be appropriate for paralegals in Macon).
ii. Reasonable Hours
The second step in the lodestar approach is to assess the reasonable
number of hours expended. Hensley, 461 U.S. at 434, 103 S. Ct. at 1939. The
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hours claimed by the party seeking fees must be properly documented. Loos,
731 F. Supp. 2d at 1330. Generalized statements of the hours worked are not
sufficient for purposes of fee awards; instead, a party must submit proof of the
hours dedicated to the litigation. Id. Additionally, “[c]ounsel for the prevailing party
should make a good faith effort to exclude from a fee request hours that are
excessive, redundant, or otherwise unnecessary.” Hensley, 461 U.S. at 434, 103
S. Ct. at 1939.
In a case where the billing records are voluminous, the court is not
required to examine each individual billing entry to determine reasonableness.
Loranger v. Stierheim, 10 F.3d 776, 783 (11th Cir. 1994) (determining that in
cases where records are voluminous “an hour-by-hour review is simply
impractical and a waste of judicial resources”). Instead, in cases with extensive
billing records, courts are authorized to employ across-the-board percentage cuts
either in the number of hours claimed or the final lodestar figure if there is a need
to reduce the amount of hours claimed by attorneys. Id.
In this case, Plaintiffs’ counsel submits that lead counsel, Mr. Taylor, billed
207.20 hours on this litigation from the filing of the complaint through the trial.
Co-counsel, Mr. Montroy, billed 547.2 hours on the matter and Plaintiffs’
counsel’s paralegals spent 33.0 hours on the litigation. Plaintiffs claim that these
hours are reasonable and the total 787.6 hours should be fully compensated.
Defendant raises several objections to the hours claimed by Plaintiffs’ counsel.
Defendant claims that the billing entries submitted by Plaintiffs’ counsel contain
8
“redundant billing, vague time entries, block-billing, and billing for services that
were clerical or unnecessary.” (Doc. 67, p. 10.) The Court finds that Defendant’s
arguments do have some merit and finds that across-the-board reductions for
these billing discrepancies is justified.
First, the Court finds it appropriate to reduce the overall hours submitted by
Plaintiffs’ counsel to compensate for clerical work that was billed by paralegals.
“A court may award fees for the work of paralegals, but only to the extent they
[they] perform work traditionally done by an attorney.” SE Property Holdings, LLC
v. 145, LLC, 10-00521-KD-B, 2012 WL 6681784 at *5 (S.D. Ala. Dec. 21, 2012)
(quoting Scelta, 203 F. Supp. 2d at 1334 (internal quotations omitted)). Where
this is not the case, paralegal work is viewed as falling within the category of
unrecoverable overhead expenses. Scelta, 203 F. Supp. 2d at 1334. In this case,
many of the billing entries submitted by paralegals are clerical in nature.
Defendant submitted a list of objectionable billing entries that amounted to an
alleged 32.8 hours of clerical work that was improperly billed by paralegals
working on the case. (Doc. 69-3.) These entries include work descriptions such
as “organize documents received from client” (Sept. 27, 2011); “prepare
documents previously produced for counsel’s review” (Dec. 16, 2011); and
“prepare hearing notebook” (Feb. 7, 2013). These tasks are not traditionally done
by an attorney, and therefore, they are not properly included in an award of
attorney’s fees. Thus, the paralegal hours shall be reduced by 50%.
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Second, the Court finds than a 5% reduction is appropriate on the
attorney’s hours based on “block billing.” “Block billing” occurs when an attorney
lists all of the day’s tasks on a case in a single entry and does not separate the
tasks and the time spent working on those individual tasks as separate entries on
billing records. Ceres Envtl. Servs, Inc. v. Colonel McCrary Trucking LLC, 476
Fed. App’x. 198, 203 (11th Cir. 2012). Examples of block billing are apparent in
both Mr. Taylor’s and Mr. Montroy’s billing records. For example, on February 27,
2013, Mr. Taylor billed 6.6 hours for “lengthy review and analysis of all file
documents; motions on summary judgment and motion to strike; outline and
prepare arguments; conference with Mr. Howard re: same.” On March 26, 2012,
Mr. Montroy billed 7.9 hours and described his tasks as “prepare for deposition of
Defendant; telephone conference with audit firm; strategy conference with CEE;
travel to and attend deposition of Defendant.” On May 8, 2013, he billed 9 hours
for “extensive analysis of damages in various scenarios of trial and settlement;
review trust agreements for all six Plaintiff funds re: interest calculations;
calculate same allocate unpaid contributions to all six funds using rates of
contribution per man-hour worked; conference with EJT re: same.” These entries
are improper and warrant an across-the-board percentage cut.
Based on the reasoning above, the total hours claimed by Plaintiffs’
counsel must be reduced. Mr. Taylor originally claimed 207.20 hours, Mr.
Montroy claimed 547.20 hours, and paralegals claimed 33.20 hours. A 50%
reduction in the paralegal’s hours based on the improper inclusion of clerical
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work reduces the hours of the paralegal from 33.20 to 16.6 hours. A 5%
reduction for block billing, which applies only to Mr. Taylor and Mr. Montroy,
brings the amount properly billed to 196.84 for Mr. Taylor and 519.84 for Mr.
Montroy.
Based on the rates and hours set out above, the amount of attorney’s fees
using the lodestar approach is $76,767.60 for Mr. Taylor (196.84 hours x $390),
$98,769.60 for Mr. Montroy (519.84 hours x $190), and $1,245.00 for paralegal
hours (16.6 hours x $75.00). Thus, the total amount of fees under the lodestar
approach is $176,782.20.
iii. Overall Reduction
The Supreme Court has determined that there are times when the lodestar
calculation must be reduced so that the award to the attorneys in a case can be
properly considered a “reasonable” fee. Specifically, the Court has stated that
[t]he product of reasonable hours times a reasonable rate does
not end the inquiry. There remain other considerations that may
lead the district court to adjust the fee upwards or downward,
including the important factor of the ‘results obtained.’ This factor
is particularly crucial where a plaintiff is deemed ‘prevailing’ even
though he succeeded on only some of his claims for relief.
Hensley, 461 U.S. at 434, 103 S. Ct. at 1940. In this case, Defendant argues that
Plaintiffs should be subject to an across-the-board percentage cut to account for
limited success in the case. Defendant claims that Plaintiffs’ counsel is seeking to
be fully compensated despite the fact that Plaintiffs did not prevail on all aspects
of their claim. Defendants point out that Plaintiffs’ claim for contributions for
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clean-up work did not prevail, and therefore, Defendant argues that the amount
of attorney’s fees awarded by the Court should be reduced so that the award of
fees is proportional to the monetary judgment awarded to Plaintiffs for unpaid
contributions. In response, Plaintiffs claim that this type of percentage reduction
based on proportionality does not apply in ERISA cases. For support, Plaintiffs
cite to United Auto. Workers Local 259 v. Metro Auto Center, 501 F.3d 283 (3rd
Cir. 2007), which rejects a proportionality argument under ERISA § 502(g)(2),
determining that there is no ratio of reasonability to which fees and damages
must conform. 2
This Court finds it unnecessary to reach to the issue of what role
proportionality plays in the calculation of attorney’s fees under ERISA. The Court,
based on its judgment and experience, finds that no reduction is necessary in
this case based on proportionality or any other consideration. The $176,782.20
figure calculated using the lodestar approach is reasonable and appropriate
based on the hours spent on this case, the success achieved, and the complex
nature of ERISA litigation. Thus, the Court finds no reason to reduce the lodestar
amount by an across-the-board percentage.
b. Expenses
In addition to attorney’s fees, a prevailing party is entitled to be reimbursed
for reasonable expenses of litigation. The Eleventh Circuit has held that
2
It does not appear that the Eleventh Circuit has issued an opinion addressing
what role, if any, proportionality should play in an award of attorney’s fees under
ERISA § 502(g)(2).
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“[r]easonable attorneys’ fees ... must include reasonable expenses … as equally
vital components of the cost of litigation.” Dowdell v. City of Apopka, 698 F.2d
1181, 1190 (11th Cir. 1983). Thus, all reasonable expenses incurred through the
litigation process, with the exception of routine office overhead, are recoverable.
In this case, the Court finds the expenses claimed by Plaintiffs’ counsel to
be, for the most part, reasonable. The expenses were mostly incurred on travel
associated with the litigation, copying costs, and transcript fees. The one
objectionable item that does not qualify as a nontaxable expense is online
research fees. Computer research is generally considered part of attorney’s fees
rather than costs. Haroco, Inc. v. Am. Nat’l Bank & Trust Co. of Chicago, 38 F.3d
1429, 1440 (7th Cir. 1994). Because computer research constitutes part of
attorney’s fees, entitlement to these fees must be proven by the requesting party.
Just as Plaintiffs had to establish entitlement to attorney’s fees, they must also
demonstrate that they are entitled to computer research costs. In this case, the
records submitted to the Court do not provide sufficient information to determine
the reasonableness of these research charges, and thus, the request to claim
these charges as nontaxable expenses is denied. For this reason, $154.47 spent
on Lexis fees shall be deducted from the total of nontaxable expenses to which
Plaintiffs are entitled.
Plaintiffs initially requested $4,606.83 in expenses. After deducting
$154.47 on impermissible online research fees, $4,452.36 is the resulting
amount that is properly claimed by Plaintiffs in expenses.
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III.
CONCLUSION
Based on the reasoning set out above, the Court finds that Plaintiffs’
Motion for Attorney’s Fees shall be granted. Plaintiffs are awarded $176,782.20
in fees and $4,452.36 in expenses, for a total fee award of $181,234.56. This
amount shall be added to the amount of damages agreed to by the parties and
ordered by the Court from the bench in the amount of $74,005.60. Final judgment
shall be entered in this case in favor of Plaintiffs in the amount of $255,240.16.
SO ORDERED, this 22nd day of July, 2013.
/s/ Hugh Lawson
HUGH LAWSON, SENIOR JUDGE
ebrs
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