International Auto Logistics, LLC v. Vehicle Processing Center of Fayetteville, Inc. et al

Filing 81

ORDER granting 74 Motion for Attorneys' Fees; IAL's 73 Bill of Costs is taxed. Signed by Judge Lisa G. Wood on 7/5/2017. (ca)

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tl^e ^tateiei Bisitrtct Court tor tl^e ^ontl^em IBisitrtct ot 4leorsia Pmnoiotclt Bttitfiiton FILED Scott L. Poff, Clerk United States District Court By casbell at 9:03 am, Jul 05, 2017 INTERNATIONAL AUTO LOGISTICS, LLC, Plaintiff, 2:16-CV-10 V. VEHICLE PROCESSING CENTER OF FAYETTEVILLE, INC.; BRETT HARRIS; and BRETT HARRIS CONSULTING; Defendants. ORDER On apart. rare occasion, victory and defeat are hard to tell See, e.g., Jean-Paul Sartre, The Devil & the Good Lord 4 (trans. Kitty Black 1960) (""A victory described in detail is indistinguishable from a defeat."); Plutarch, The Life of Pyrrhus 417 (trans. Bernadotte Perrin 1920) (''If we are victorious in one more battle with the Romans, we shall be utterly ruined." (quoting Pyrrhus of Epirus)). But it was obvious who won and who held lost when this Court that Defendant Vehicle Processing Center of Fayetteville, Inc. ("VPCF") "undisputedly breached [a] Subcontract and there [wa]s no genuine factual dispute" as to Plaintiff International Auto Logistics, LLC's ("lAL") damages calculation—such that lAL was "entitled to summary judgment." Dkt. No. 68 at 8. For this reason, and the others given below, lAL's bill of costs, dkt. no. 73, will be TAXED to VPCF, and lAL's motion for attorneys' fees, dkt. no. 74, will be GRANTED. BACKGROUND VPCF had a subcontract to run a vehicle-processing and storage center for lAL, a government contractor. Dkt. No. 68 at 1. VPCF violated labor laws and tried to cover that up. Id. 5-6. at Id. lAL found out and terminated the subcontract. lAL calculated what it owed VPCF as being just south of $60,000. Id. at 6. entitled to 95.5% VPCF responded by claiming that it was of everything government—over $3,000,000. lAL earned from the Id. lAL sought declaratory judgment as to what it owed VPCF and VPCF counterclaimed breach of contract. Id. at 7. lAL repeatedly informed VPCF that it was seeking attorneys' fees. Dkt. No. 79 at 25 (extracting from Sept. 8, 2016 deposition), 32 (extracting from June 10, 2016 initial disclosures). The Court the ultimately subcontract. held Dkt. No. that 68 at VPCF, 11-13. not It properly calculated how much it owed VPCF. lAL, then breached held that lAL Id. at 13-19. lAL moved for costs and attorneys' fees on May 30, 2017. Dkt. Nos. 73-1, 74. Both matters have been fully briefed and are now ripe for disposition. Dkt. Nos. 76, 78-79. LEGAL STAin)ARD a general rule, expenses of litigation party unless an are authorized award 508 S.E.2d absence of a controlling attorney fees and not available to the prevailing by statute Guiragossian, of 403, 406 or contract." (Ga. statute, a Gary 1998). ''[I]n v. the party's entitlement to attorney fees under a contractual provision is determined by the usual Builders, rules Inc. v. of contract Schultz, 711 interpretation." S.E.2d 639, 640 Benchmark (Ga. 2011) (citation omitted); accord City Heights Condo. Ass'n, Inc. v. Bambara, 788 S.E.2d 563 (Ga. Ct. App. 2016) (applying similar rule in costs context); Dan J. Sheehan Co. v. McCrory Constr. Co., 643 S.E.2d 546, 549 (Ga. Ct. App. 2006) (holding arbitrator appropriately considered ^'the contractual language regarding . . . costs"). DISCUSSION lAL is entitled to costs and fees. VPCF objects on four grounds: (1) lAL did not prevail; (2) there is no contractual basis for awarding fees; (3) lAL never tendered any money to VPCF; and (4) the fees request is not specific enough. No. 76 at frivolous. 3; Dkt. No. 78 at 1. The first Dkt. argument is The remaining three are not much better and are also meritless. I. lAL WAS THE PREVAILING PARTY. VPCF absurdly claims that it ''is entitled to attorney's fees because it was the prevailing party." Dkt. No. 76 at 6. It goes so far as to promise that it "will seek an award of attorney's fees." It is Id. at 7. extremely clear 'prevails' when that actual This effort would be in vain. lAL relief prevailed. on the ''MA] merits of plaintiff his claim materially alters the legal relationship between the parties by modifying the defendant's behavior in a way that directly benefits the plaintiff." Farrar v. Hobby, 506 U.S. 103, 111- 12 (1992) (interpreting 42 U.S.C. § 1988). "In other words, there must be: (1) a situation where a party has been awarded by the court '"at least claim"' or (2) legal a some relief on 'judicial imprimatur on relationship between the the the parties." merits of his change' in the Smalbein ex rel. Estate of Smalbein v. City of Daytona Beach, 353 F.3d 901, 905 (11th Cir. 2003) (interpreting 42 U.S.C. § 1988) (quoting Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep't of Health & Human Res., 532 U.S. 598, 603, 605 U.S.C. §§ 3613(c)(2), 12205)); see Ass'n V. Garland Indep. Sch. (2001) also Dist., (interpreting Tex. State 489 U.S. 42 Teachers 782, 791-92 (1989) (interpreting 42 U.S.C. § 1988) (requiring only that party prevail omitted)). as to "any significant issue" (citation A declaratory judgment "will usually satisfy that test." Lefemine v. Wideman, 568 U.S. 1, 4 (2012) (interpreting 42 U.S.C. § 1988). VPCF's ^'The argument Court has as to how ultimately $59,446.58," whereas lAL it held prevailed that initially is [lAL] offered threefold: owes [VPCF] VPCF $3000 than that and ''took the position that it owed nothing." less Dkt. No. 76 at 5; see also id. at 6 ("[TJhere was no relief granted to [lAL] against [VPCF]."). "lAL had previously dismissed its other claims against VPCF . . . ." Id. at 7. And "lAL could have filed an interpleader action, but it did not." The mirror. first In contention its is complaint, more lAL slanted asked Id. at 5. than the a Court funhouse to issue declaratory judgment as to "the amount, if any, due to VPCF." Dkt. No. 1 SI 23. lAL alleged that it "calculated the amount it determined to be due," but that VPCF rejected this amount and "contended Id. SISI 13-14. that it was due more than $2 million more." By summary judgment, lAL asked the Court to decide that it owed $59,446.58—the amount the Court ultimately accepted. indeed Dkt. No. 46 at 16; Dkt. No. 68 at 19. $3000 more than lAL offered VPCF before This was litigation— because lAL voluntarily reconsidered one of the offsets it had made. Dkt. No. 44-3 SI 42. On every issue that remained in dispute, the Court sided with lAL. It totally rejected VPCF's claim that it was entitled to nearly 58 times more than lAL alleged was due. Dkt. No. 68 at 13-16. As for lAL's dismissal of certain claims against VPCF, a party prevails as long as it wins on any significant issue. Tex. State Teachers Ass^n, 489 U.S. at 791-92. lAL satisfies that standard by a wide margin. Regarding sentence: interpleading, offers only a single ''lAL could have filed an interpleader action, but it did not." Dkt. No. 76 at 5. merits argument. Court VPCF need not This might be a belated It might just be an inchoate thought. decide. Cf. Resolution Tr. Corp. v. The Dunmar Corp., 43 F.3d 587, 599 (11th Cir. 1995) (en banc) (^'There is no burden upon the district court to distill every potential argument that could be made based upon the materials before it Rather, to formulate arguments the onus is . upon . Whatever . ."). the parties the case, interpleader is not a basis for finding that lAL failed to prevail. Some unconventional vernacular meanings of ^'winning" notwithstanding,^ lAL prevailed in this case.^ ^ See, e.g., Katy Steinmetz, Winning/Winner, Time (Dec. 7, 2011),,28804,2101344_210 0571_2100573,00.html (^*Once upon victorious.' . . . Charlie Sheen a time, the verb win meant ^to be had solidified a definition for the term that goes something like this: winning (v.): ^participating in an ostensibly drug-induced, highly public flameout, during which one loses an incredibly lucrative job and, subsequently, the respect of the American people.' Or more, succinctly: winning (v.): losing." (emphasis added)). ^ As this was the only reason VPCF gave for opposing lAL's bill of costs, see dkt. no. 78, those costs will be TAXED. II. THE SUBCONTRACT AUTHORIZES A FEE AWARD. VPCF next contends that authorize a fee award here. the subcontract does not This argument touches on genuine difficulties posed by the subcontract, but is not ultimately persuasive. first Subcontract section 26 has four paragraphs. gives lAL the option The of taking 'Ma]ny controversy or claim arising out of or relating to this Agreement, or the breach thereof," to arbitration. Dkt. No. 5 § 26. specifies where such arbitration would happen. The second Id. The third says, ''Notwithstanding the foregoing, any Party may, at any time, apply to any Court of competent jurisdiction injunctive relief . . . to prevent irreparable harm." The last provides: for Id. "In any action initiated by either party under this section, the prevailing party shall be entitled to recover its expenses attorney's fees." The prevailing including are whether under section 26 party" within the the and to the Court for last injunctive current whether Clearly, this case was not arbitrated. apply its reasonable Id. questions "initiated" incurred, matter lAL paragraph's was was "the meaning. And, although lAL did relief against VPCF and other defendants to prevent irreparable harm in the form of harassing debt-collection efforts, no injunctive relief issued against VPCF. Dkt. No. 1 at 10; Dkt. No. 49. Nevertheless, the Court answers the above questions in the affirmative. to secure This case was literally ^^initiated" by lAL injunctive irreparable harm. relief against VPCF to prevent Although a different outcome might have been required had lAL lacked a good-faith basis for doing so, it in fact had one—it did not know whether VPCF had authorized the harassment. But is lAL the prevailing party, even though it did not prevail specifically as to enjoining VPCF? Yes. Section 26's two requirements, initiation and prevailing, are independent of each other. The last paragraph refers to ^'any action." That means the parties intended for it to apply to a broader suit that grew out of an effort to seek injunctive relief—like this one. Further, the paragraph refers to any action "initiated" under section 26, rather than limiting fees to an action resulting in relief mentioned therein. The paragraph also uses the term "prevailing party," without qualification. Id. Had the parties meant to narrow this to a party who received injunctive relief against the other, they could have said so. Turning from text to context, the last paragraph is physically separate from the third. Under section 26, then, seeking injunctive relief under the third paragraph opened the door to a broader case, the prevailing party of which was authorized by the last paragraph to seek costs and fees. The subcontract lets lAL recover fees here. III. TENDER IS IRRELEVANT. VPCF says lAL cannot obtain attorneys' fees because it ''failed to tender what it admitted it owed when it terminated the contract with VPCF." Dkt. No. 76 at 8. This suit, according to VPCF, happened because lAL tried to "force VPCF into submission." Id. at 9. This litigation, lAL offered VPCF $56,446.58. VPCF rejected that. Id. 5 38. is false. Before Dkt. No. 44-3 5 36. Four days after filing suit, lAL offered VPCF "$112,000.00 (twice the amount [lAL] believed to be owed)." Id. 5 41. VPCF rejected that, too. reason why became clear in litigation: entitlement to $3,144,450.70. Id. The VPCF insisted on its Dkt. No. 68 at 6. VPCF waged legal war on lAL for a year and a half based on a contractual interpretation this Court deemed "patently" wrong. Id. at 16. For it to now strong-arm it boggles the mind. cast lAL as trying to lAL's supposed failure of tender is no reason to withhold attorneys' fees. IV. THE FEES REQUEST IS SPECIFIC ENOUGH. VPCF lastly argues that lAL's fee request is not supported by records "address[ing] the issue of what alleged attorney's fees relate to what specific issue," and that "[f]ees relating to issues which were not decided in favor of the party seeking attorney's fees should be excluded." No. 76 at 7. counsel This is yet another mischaracterization. plainly specified how much time was Dkt. lAL's spent on individual issues and segregated out the claims on which lAL prevailed. Dkt. No. 74 at 17, 89-98. lAL made reasonable, generally 50% reductions to the amount of time it spent on issues relating to the complaint to reflect the fact that the complaint concerned both VPCF and other defendants. 17, 89-90; contest the see also Dkt. reasonability No. of 1. the Although fee rate, VPCF the Id. at does not Court has reviewed it and found it appropriate given prevailing market rates, ""the type of litigation at issue," and the skill and experience of the legal personnel involved. Miller v. Kenworth of Dothan, Inc., 117 F. Supp. 2d 1247, 1258-59 (M.D. Ala. 2000). VPCF's final contention therefore fails. CONCLUSION For the reasons above, lAL's bill of costs, dkt. no. 73- 1, is TAXED to VPCF in the amount of $3052.80, and its Motion for Award of Attorneys' Fees, dkt. no. 74, is GRANTED in the amount of $76,359.60. Thus, combined costs and fees. 10 VPCF owes lAL $79,412.40 in so ORDERED, this 5th day of July, 2017. HOlt: LISA GODBEY WOOD, JUDGE UNITED STATES DISTRICT COURT SOUTHERN A0 72A (Rev. 8/82) 11 DISTRICT OF GEORGIA

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