Diamond Resort Hawaii Corporation et al v. Bay West Kailua Bay, LLC

Filing 93

FINDINGS AND RECOMMENDATION THAT PLANTIFFS' MOTION FOR ATTORNEY'S FEES AND COSTS BE GRANTED IN PART AND DENIED IN PART re: 70 . ~ "The Court RECOMMENDS that Plaintiffs be awarded $195,931.27 in attorneys' fees and co sts." ~ Signed by Judge BARRY M. KURREN on 10/24/2011. (afc)CERTIFICATE OF SERVICEParticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). All participants are registered to receive electronic notifications.

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
DIAMOND RESORT HAWAII
CORPORATION, a Hawaii
corporation, et al.,

)
)
)
)
Plaintiffs,
)
)
vs.
)
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BAY WEST KAILUA BAY, LLC, a )
Virginia limited liability company, )
)
Defendant.
)
)
_____________________________ )

CV. NO. 10-00117 DAE-BMK
FINDINGS AND
RECOMMENDATION THAT
PLAINTIFFS’ MOTION FOR
ATTORNEY’S FEES AND COSTS
BE GRANTED IN PART AND
DENIED IN PART

FINDINGS AND RECOMMENDATION THAT PLAINTIFFS’ MOTION FOR
ATTORNEY’S FEES AND COSTS BE GRANTED IN PART AND DENIED IN
PART
Before the Court is Plaintiffs Diamond Resort Hawaii Corporation,
Diamond Resort Management Inc., and Janic Corporation’s (collectively,
“Plaintiffs”) Motion for Attorney’s Fees and Costs. (Doc. # 70.) After careful
consideration of the motion, the supporting memorandum, and the attached
documentation, the Court FINDS and RECOMMENDS that Plaintiffs’ motion be

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GRANTED IN PART AND DENIED IN PART.1
Briefly stated, this dispute stems from Defendant’s breach of a note
owed to Plaintiffs in the amount of $2,123,255.00. (Order Granting Summ. J., Doc
# 57 at 2.) District Judge David A. Ezra granted Plaintiffs’ motion for summary
judgment and directed Plaintiffs to file a separate motion on the issue of damages.
(Id. at 23.) Judge Ezra subsequently granted Plaintiffs’ motion for summary
judgment on the issue of damages, and issued judgment in favor of the Plaintiffs
for $2,545,795.15. (Order Granting Summ. J. on Damages, Doc. # 67 at 14.)
Plaintiffs filed the instant motion for attorneys’ fees and costs, and Defendant did
not file an opposition. (Doc. # 70.)
This Court FINDS and RECOMMENDS that Plaintiffs are entitled to
attorneys’ fees under Hawaii Revised Statutes (“HRS”) § 607-14 (Supp. 2010),
because they prevailed, and the note at issue contained a provision requiring the
payment of attorneys’ fees in the event of nonpayment. (Doc # 70, Ex. A at 2, ¶ 9)
(“If this note is not paid when due . . . or if it is collected through a bankruptcy or
other court proceedings, whether before or after maturity, Maker agrees to pay all
costs of collection, including, without limitation, reasonable attorneys’ fees,

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Pursuant to Rule LR7.2(d) of the Local Rules of Practice of the United States
District Court for the District of Hawaii (“Local Rules”), the Court elects to decide this matter
without a hearing.
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investigation costs, and all court costs incurred by Holder.”); see HRS § 607-14
(providing that when a contract contains a fees provision, “there shall be taxed as
attorneys’ fees, to be paid by the losing party and to be included in the sum for
which execution may issue, a fee that the court determines to be reasonable . . . .”).
Therefore, Plaintiffs are entitled to attorneys’ fees.
With respect to the reasonableness of the fees, Hawaii courts calculate
reasonable attorneys’ fees based on a method that is virtually identical to the
traditional “lodestar” calculation set forth in Hensley v. Eckerhart, 461 U.S. 424,
433 (1983). See DFS Grp. L.P. v. Paiea Props., 131 P.3d 500, 505 (Haw. 2006).
Reasonable attorneys’ fees are determined by multiplying the number of hours
reasonably expended by a reasonable hourly rate. See id. at 505-06. The Plaintiffs
are seeking $198,355.72 in fees and taxes for 809.1 hours of work. (Mem. in
Supp. of Mot., Doc. # 70 at 11-12.) With the exception of the fees charged in
connection with the use of paralegals and staff, the fees requested by Defendants
on their face do not appear to be unreasonable. There being no opposition, this
Court FINDS that the attorneys’ fees requested for all matters not related to
paralegals and staff are reasonable. With respect to the fees related to paralegals
and staff, Plaintiffs billed 294 hours for five paralegals and a “senior office clerk”
with a certificate in paralegal studies. (Harstad Decl., Doc. # 70 at 9, ¶ 8(p); Mem.
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in Supp. of Mot., Doc. # 70 at 11.)) The paralegals were billed at a rate of $150 to
$160 per hour and the senior office clerk was billed at a rate of $120 per hour.
(Mem. in Supp. of Mot., Doc. # 70 at 11.) The Plaintiffs billed a total of $42,399
for the paralegals and the clerk. Id. Courts in this district have typically allowed a
rate of $85 per hour for paralegals. See Donkerbrook v. Title Guar. Escrow
Services, Inc., Civ. No. 10–00616 LEK–RLP, 2011 WL 3649539, at *7 (D. Haw.
Aug. 18, 2011); Ko Olina Dev., LLC v. Centex Homes, Civ. No. 09-00272
DAE-LEK, 2010 WL 447451, at *2-3 (D. Haw. Feb. 9, 2010) (finding that $85 is a
reasonable hourly rate for a paralegal with thirty years of experience). This Court
FINDS that $85 per hour is a reasonable rate for the paralegals and the office clerk
in this case, and that $24,990 (294 hours * $85/hour = $24,990) is a reasonable
amount of fees to be awarded for their services. The Court FINDS that $17,409
($42,399 - $24,990 = $17,409) should be subtracted from Plaintiffs’ request for
fees. Therefore, this Court FINDS and RECOMMENDS that Plaintiffs’ Motion
for Attorneys’ fees be GRANTED IN PART AND DENIED IN PART, and that
Plaintiffs be awarded $180,946.72 in attorneys’ fees.
With respect to costs, Plaintiffs assert that they are entitled to
$14,984.55 in costs broken down as follows: 1) $377.00 in filing and certification
fees; 2) $951.50 in internally-incurred copying costs; 3) $9,057.70 in copying costs
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paid to an outside vendor; and 4) $4,598.35 in Westlaw charges for legal research
in the case. (Mem. in Supp. of Mot., Doc. # 70 at 14.) Rule 54(d)(1) of the
Federal Rules of Civil Procedure (“FRCP”) provides that “[u]nless a federal
statute, these rules or a court order provides otherwise, costs – other than attorney’s
fees – should be allowed to the prevailing party.” Hawaii courts have also
interpreted HRS § 607-14 to allow an award of costs. See Fought & Co., Inc. v.
Steel Eng’g & Erection, Inc., 951 P.2d 487, 502 (Haw. 1998) (noting that appellate
courts have jurisdiction to award costs pursuant to HRS § 607–14). The costs
listed by the Plaintiffs do not appear unreasonable on their face and Defendant has
not filed an opposition suggesting that the costs requested by the Plaintiffs are
unreasonable. Therefore, this Court FINDS and RECOMMENDS that Plaintiffs
are entitled to $14,984.55 in costs.
CONCLUSION
For the foregoing reasons, the Court FINDS and RECOMMENDS
that Plaintiffs’ Motion for Attorneys’ Fees and Costs be GRANTED IN PART
AND DENIED IN PART. The Court RECOMMENDS that Plaintiffs be awarded
$195,931.27 in attorneys’ fees and costs.
DATED: Honolulu, Hawaii, October 24, 2011.

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IT IS SO FOUND AND RECOMMENDED.

/S/ Barry M. Kurren
Barry M. Kurren
United States Magistrate Judge

Diamond Resort Hawaii Corporation et al. v. Bay West Kailua Bay, LLC; Civ. No.
10-00117 DAE-BMK; FINDINGS AND RECOMMENDATION THAT
PLAINTIFFS’ MOTION FOR ATTORNEY’S FEES AND COSTS BE
GRANTED IN PART AND DENIED IN PART.
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