Ke Kailani Partners, LLC v. Ke Kailani Development LLC et al

Filing 43

FINDINGS AND RECOMMENDATION TO GRANT IN PART AND DENY IN PART PLAINTIFF'S ATTORNEY'S FEES AND COSTS. Signed by Judge BARRY M. KURREN on 12/18/2013. 28 ~ The Court finds and recommends thatPlaintiff's Submission Regard ing Award of Attorneys' Fees and Costs be GRANTED IN PART AND DENIED IN PART. The Court finds and recommends that KKP's request for fees associated with its Motion for Rule 11 Sanctions by DENIED, and that KKPs request for fees incurred in its Motion to Remand and in preparing its Fee Submission be GRANTED in the amount of $17,475.89. (ecs, )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). Participants not registered to receive electronic notifications were served by first class mail on the date of this docket entry

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
KE KAILANI PARTNERS, LLC,

)
)
Plaintiff,
)
)
vs.
)
)
KE KAILANI DEVELOPMENT,
)
LLC, ET AL,
)
)
Defendants.
)
______________________________ )

Civ. No. 13-00347 LEK-BMK
FINDINGS AND
RECOMMENDATION TO GRANT
IN PART AND DENY IN PART
PLAINTIFF’S ATTORNEYS’ FEES
AND COSTS

FINDINGS AND RECOMMENDATION TO GRANT IN PART AND DENY
IN PART PLAINTIFF’S ATTORNEYS’ FEES AND COSTS
Before the Court is Plaintiff Ke Kailani Partners, LLC’s (“KKP”)
Submission Regarding Award of Attorneys’ Fees and Costs. (Doc. 28.) The Court
finds and recommends that Plaintiff’s submission be GRANTED IN PART AND
DENIED IN PART. The Court recommends that KKP be awarded attorneys’ fees
in the amount of $17,475.89.
FACTUAL BACKGROUND
On July 7, 2013, KKP filed a Motion to Remand this case on the
grounds that removal was improper, and requested “costs and fees be awarded in
connection with this motion.” (Docs. 5, 5-1) In September 2013, a little over three

weeks before the scheduled hearing on KKP’s Motion for Remand, KKP filed a
Motion for Rule 11 Sanctions against Gary Dubin, counsel for Defendants Ke
Kailani Development, LLC (“KKD”), et al. (Doc. 18.) Like the Motion for
Remand, this Motion alleged that the notice of removal was improper, and sought
sanctions, “at the least, requiring Dubin to pay the attorney’s fees and costs
Plaintiff incurred seeking remand back to State Court . . ., and the attorney’s fees
and costs Plaintiff incurred enforcing Rule 11 through having to file this Motion.”
(Doc. 18 at 7.)
On October 24, 2013, District Judge Leslie E. Kobayashi issued an
Order Granting KKP’s Motion for Remand, and remanded this case to the First
Circuit Court of Hawaii.1 (Doc. 23.) In her Order, Judge Kobayashi held that
Defendants’ Notice of Removal was untimely, and that KKD “lacked an
objectively reasonable basis for seeking removal.” (Doc. 23 at 15.) In addition,
Judge Kobayashi granted KKP’s request for fees and costs pursuant to 28 U.S.C. §
1447(c), which provides for an award of fees and costs where the removing party
lacks an objectively reasonable basis for seeking removal. (Doc. 23 at 14-16.)

1

Defendants filed a Motion for Reconsideration of Judge Kobayashi’s Order Granting
Plaintiff’s Motion for Remand. (Doc. 23.) Additionally, Defendants filed a Notice of Appeal
from Judge Kobayashi’s Order Granting Plaintiff’s Motion for Remand and Fees. (Doc. 33.)
Judge Kobayashi issued an Order Denying Defendants’ Motion for Reconsideration. (Doc. 37.)
Defendants’ appeal is still pending.
2

Specifically, Judge Kobayashi’s order stated, “[t]he Court therefore GRANTS the
Motion as to Plaintiff’s request for attorneys’ fees and costs incurred with respect
to the Motion.” (Doc. 23 at 15.) Judge Kobayashi then directed KKP to file
documentation supporting its request for attorneys’ fees and costs with this Court
by November 12, 2013. (Id. at 16.) On the same day that Judge Kobayashi’s
Order Granting KKP’s Motion for Remand was filed, this Court issued an Order
Terminating KKP’s Motion for Sanctions, “[i]n light of the Order Granting
Plaintiff’s Motion for Remand.” (Doc. 25.)
KKP timely submitted the present request, seeking attorneys’ “fees
and tax it incurred as a result of improper removal in the amount of $34,826.12.”
(Doc. 28 at 4.) KKP’s submission requests fees for three discrete areas of work:
1) removal and KKP’s Motion for Remand ($18,895.62); 2) KKP’s Motion for
Rule 11 Sanctions filed in reaction to KKD’s removal ($10,805.24); and 3) the
preparation of the their Fee Submission ($5,125.26). (Doc. 28 at 11-12.)
DISCUSSION
The calculation of reasonable attorneys’ fees is based on the
traditional lodestar calculation set forth in Hensley v. Eckerhart, 461 U.S. 424, 433
(1983). Courts must determine a reasonable fee by multiplying the number of
hours reasonably expended by a reasonable hourly rate. Id. “The party seeking an
3

award of fees should submit evidence supporting the hours worked and rates
claimed. Where the documentation of hours is inadequate, the district court may
reduce the award accordingly.” Id.
The following charts represent the lodestar amount requested by KKP,
broken down by attorney and hours spent per task:
Motion for Remand
Sharon Lovejoy ($425/hr.)
Brandi Buehn Balanda ($230/hr.)
Chyna Stone ($175/hr.)
Subtotals

27.2
21.6
9.2
58
GET

$11,560.00
$4,968.00
$1,610.00
$18,138.00
$756.72

Total

$18,894.72

Rule 11 Motion
Sharon Lovejoy ($425/hr.)
Brandi Buehn Balanda ($230/hr.)
Subtotals

6.6
32.9
39.5
GET

$2,805.00
$7,567.00
$10,372.00
$432.72

Total

$10,804.72

Submission of Fees & Costs
Sharon Lovejoy ($425/hr.)
Lisa Evans ($175/hr.)
Subtotals

GET

$2,295.00
$2,625.00
$4,920.00
$205.26

Total
Total
2

5.4
15
20.4

$5,125.26
$34,824.70 2

This billing information is drawn from KKP’s billing summaries. (Doc. 28-3.) Note
that this total varies slightly from the amount requested in the text of KKP’s submission,
$34,826.12. (Doc. 28 at 4.) It appears that an error in the text of KKP’s Submission arises from
4

Defendants oppose KKP’s Fee Submission on three grounds. First,
Defendants argue that the entire submission should be rejected for failure to adhere
to the formatting and filing requirements of Local Rule 54.3(d)(1) and Local Rule
54.3(b). Second, Defendants object to the scope of the submission, arguing that
fees incurred for KKP’s Rule 11 Motion and fees for work preparing the
submission should be denied. Third, Defendants contest the reasonableness of
KKP’s request for fees incurred in its Motion to Remand. The Court addresses
each of these arguments in turn.
A.

Form of the Fee Submission

Local Rule 54.3(d)(1) provides that within a memorandum in support
of a motion for fees, work performed shall be organized by eight phases: case
development; pleadings; interrogatories; depositions; motions practice; attending
hearings; trial preparation; and post-trial motions. Rule 54.3(b) provides that the
court will not consider a motion for fees without a concomitant statement of
consultation documenting the good faith effort of counsel to resolve fees and costs
issues outside of court. KKP’s submission is not organized by phases and lacks a
statement of consultation.

transposing numbers in the GET due in connection with the Motion for Remand. (Doc. 28 at
11.)
5

In the first instance, the Fee Submission presently before the court is
not a motion for fees covered by Local Rule 54.3. Rather, it is a submission in
support of a Motion for Fees already granted by Judge Kobayashi’s order
remanding this case. Accordingly the Court finds that neither Rule 54.3(d)(1) or
(b) are strictly applicable here. Moreover, the submission covers a narrow range of
work for two motions and the submission itself. The Court finds it would be
nonsensical to require KKP’s submission to adhere to irrelevant formatting
requirements based upon non-existent phases of litigation. Additionally, the
purpose of consultation is to “preserve judicial and party resources by allowing the
parties to reach an agreement, if any, on the request for fees.” Botelho v. Hawaii,
CV 06-00096 DAE-BMK, 2009 WL 1838336 (D. Haw. June 18, 2009). Under the
circumstances of this case, because KKP’s Motion for Fees has already been
litigated in KKP’s Motion to Remand, and granted in principle by Judge
Kobayashi, the Court finds a statement of consultation is not required. See
Robinson v. Plourde, 717 F. Supp. 2d 1092, 1095 n.1 (D. Haw. 2010) (excusing
non-compliance with Rule 54.3(b) where fee motion was filed as agreed during
settlement). Accordingly, the Court finds that the form and content of KKP’s
submission is generally acceptable.

6

B.

Scope of Fee Award

KKP’s submission seeks fees associated with its Motion to Remand,
Motion for Sanctions, and the Fee Submission itself. The fees incurred in relation
to KKP’s Motion to Remand are clearly compensable under 28 U.S.C. § 1447(c),
and pursuant to Judge Kobayashi’s order. Defendants contend, however, that fees
and costs incurred in connection with KKP’s Motion for Rule 11 Sanctions and the
submission of KKP’s fee and cost request should not be allowed. As discussed
below, the Court finds that an award of fees incurred in filing the Motion for
Sanctions is improper, but that the award of fees for the Fee Submission is proper.
i.

Rule 11 Motion

Defendants assert that KKP is not entitled to costs and fees for their
Rule 11 Motion because the Motion was never heard by the court and KKP was
therefore not the prevailing party. 28 U.S.C. § 1447(c) provides that “[a]n order
remanding the case may require payment of just costs and any actual expenses,
including attorney fees, incurred as a result of the removal.” KKP asserts that fees
incurred in association with the preparation and filing of a Motion for Rule 11
Sanctions, although no hearing on the motion was ever held, were “reasonably”
incurred as a result of removal. KKP argues that Defendants’ “improper removal”
action was designed to “forestall Plaintiff from collecting on its judgment” in
7

excess of $21 million. KKP contends that, given the amount of the judgment, an
award of fees and costs directly associated with seeking remand would have been
ineffective disincentive for Defendants’ attempt to delay via removal.
Accordingly, KKP asserts that the Rule 11 Motion was a reasonable, additional
action aimed at deterring the Defendants’ action.
KKP’s Rule 11 Motion sought “fees and costs Plaintiff incurred
seeking remand back to State Court . . ., and the attorney’s fees and costs Plaintiff
incurred enforcing Rule 11 through having to file this Motion.” Because KKP had
already moved for costs and fees for remand in its Motion for Remand, the remedy
sought in the Rule 11 Motion was largely duplicative of the remedy already sought
in KKP’s Motion for Remand. Notably, KKP filed its Motion for Sanctions only
seventeen days before the hearing on its Motion to Remand, where the issue of fees
and costs for remand would be decided.
Additionally, Judge Kobayashi’s order granting fees and costs to KKP
expressly states that “fees and costs incurred with respect to the Motion [for
Remand]” are granted. The order, which also expressly directed KKP to file the
submission for costs and fees now before the court, makes no mention of KKP’s
Rule 11 Motion. Although KKP’s Rule 11 Motion may have been motivated by
Defendants’ removal, it was not “incurred as a result of removal” and is outside the
8

scope of Judge Kobayashi’s order. Accordingly, the Court finds that KKP’s
request for fees incurred in filing it Rule 11 Motion should be DENIED.
ii.

Fee Submission

As to the costs of preparing the Fee Submission, Defendants argue
that fees for work applying for fees is not allowed in this court. In support,
Defendants point out that the cases cited by KKP found such awards appropriate
under statutes other than 28 U.S.C. § 1447(c). This observation does not, however,
create a presumption that such an award is inappropriate in the present case.
In In re Nucorp Energy, Inc., 764 F.2d 655, 659-60 (9th Cir. 1985),
the Ninth Circuit held that “[i]n statutory fee cases, federal courts, including our
own, have uniformly held that time spent in establishing the entitlement to and
amount of the fee is compensable.” See also Southeast Legal Defense Group v.
Adams, 657 F.2d 1118, 1126 (9th Cir. 1981) (“it would be inconsistent with the
purpose” of a fee statute “to dilute a fees award by refusing to compensate the
attorney for time reasonably spent in establishing . . . his rightful claim to the
fee.”); In re Southern California Sunbelt Developer’s, Inc., 608 F.3d 456, 464 (9th
Cir. 2010) (awarding fee pursuant to the “general rule” that “[i]n statutory fee
cases, . . . time spent in establishing the entitlement to and amount of the fee is
compensable.”).
9

Accordingly, this Court finds that KKP’s request for fees incurred in
preparing its Fee Submission should be granted. Having established which areas
of work are eligible for a fee award, the Court turns to the reasonableness of KKP’s
request.
C.

Reasonable Hourly Rate

In determining whether an hourly rate is reasonable, the Court “should
be guided by the rate prevailing in the community for similar work performed by
attorneys of comparable skill, experience, and reputation.” Webb v. Ada Cnty.,
285 F.3d 829, 840 (9th Cir. 2002); see also Gates v. Deukmejian, 987 F.2d 1392,
1405 (9th Cir. 1992) (noting that the rate awarded should reflect “the rates of
attorneys practicing in the forum district”). To support a request for fees, in
addition to their own statements, attorneys are required to submit additional
evidence that the rates charged are reasonable. See Jordan v. Multnomah Cnty.,
815 F.2d 1258, 1263 (9th Cir. 1987).
KKP submitted multiple declarations attesting to the reasonableness
of the rates charged by counsel in its lodestar request. Additionally, KKP contends
that these rates are representative of prevailing market rates according to the List of
Law Firms published in Pacific Business News in 2013. (Doc. 28-1 at ¶10; Exh.

10

3.) Defendants only challenge the reasonableness of the $175 per hour rate for
student associate Chyna Stone.
Based upon this Court’s familiarity with the prevailing rates in the
community, as well as with prior attorneys’ fee awards in this District, the Court
finds that the rate for student associate Chyna Stone should be reduced to $100.
Because Defendants do not contest the remaining rates for KKP’s counsel, the
Court finds that these rates are reasonable in this instance.
D.

Reasonable Time Expended

In addition to establishing a reasonable hourly rate, a party seeking
attorneys’ fees bears the burden of proving that the fees and costs taxed are
“associated with the relief requested and are reasonably necessary to achieve the
results obtained.” Tirona v. State Farm Mut. Auto. Ins. Co., 821 F. Supp. 632, 636
(D. Haw. 1993). A court must guard against awarding fees and costs that are
excessive, and must determine which fees and costs were self-imposed and
avoidable. See id. at 637.
Where fees are excessive, courts have “discretion to ‘trim fat’ from,
or otherwise reduce, the number of hours claimed to have been spent on the case.”
Ko Olina Dev., CV. 09-00272 DAE-LEK, at *11. “Time expended on work

11

deemed ‘excessive, redundant, or otherwise unnecessary’ will not be
compensated.” Id.
KPP requests compensation for 58 hours of work in connection with
its Motion to Remand and for 20.4 hours in connection with its Fee Submission.
Work incurred in connection with remand includes work related to required
corporate disclosures, review of removal paper, legal research, drafting the motion,
reviewing opposition, preparing and drafting reply, and attending the hearing.
KKP concedes that 58 hours is “a long time,” but contends that the time spent was
nonetheless appropriate given the “novel legal theories” propounded by
Defendants, and the more than $20 million judgment pending in the case. As to
the 20.4 hours requested for the Fee Submission, KKP represents that this is a
reduced request from the 35.2 hours actually spent drafting the submission
reviewing records, creating exhibits, and conducting research.
Having reviewed the record in this case and KKP’s itemized request
for fees, the Court finds that the amount of time billed for these tasks is excessive
and should be reduced by twenty-five percent. In light of this reduction and the
foregoing discussion, the Court finds that KKP should be awarded attorneys’ fees
as listed in the following chart.

12

Motion for Remand
Sharon Lovejoy ($425/hr.)
Brandi Buehn Balanda ($230/hr.)
Chyna Stone ($100)
Subtotals

27.2
21.6
9.2
58
GET

$11,560.00
$4,968.00
$920.00
$17,448.00
$727.93

Total

$18,175.93

Submission Fees & Costs
Sharon Lovejoy ($425/hr.)
Lisa Evans ($175/hr.)
Subtotals

5.4
15
20.4
GET

$2,295.00
$2,625.00
$4,920.00
$205.26

Total

$5,125.26

Subotal
- 25%
Total

$23,301.19
$5,825.30
$17,475.89

CONCLUSION
For the foregoing reasons, the Court finds and recommends that
Plaintiff’s Submission Regarding Award of Attorneys’ Fees and Costs be
GRANTED IN PART AND DENIED IN PART. The Court finds and
recommends that KKP’s request for fees associated with its Motion for Rule 11
Sanctions by DENIED, and that KKP’s request for fees incurred in its Motion to
Remand and in preparing its Fee Submission be GRANTED in the amount of
$17,475.89.
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DATED: Honolulu, Hawaii, December 18, 2013.
IT IS SO FOUND AND RECOMMENDED.

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

Ke Kailani Partners, LLC v. Ke Kailaini Development LLC, et al, Civ. No. 13-00347 LEKBMK; FINDINGS AND RECOMMENDATION TO GRANT IN PART AND DENY IN PART
PLAINTIFF’S ATTORNEYS’ FEES AND COSTS.
14