Dunn v. Hatch et al
Filing
116
MEMORANDUM DECISION AND ORDER. IT IS HEREBY ORDERED, that the plaintiff receive from defendant the sum of $5,025.25 as attorney fees and costs as a sanction for the bad faith conduct of defendant in submitting a forgery to the Court. IT IS FURTH ER ORDERED, that the motion for attorney's fees generally (dockt no. 112 ) be GRANTED IN PART AND DENIED IN PART. It is granted to the extent it seeks, $5,000 in attorney fees as a sanction for the bad faith conduct in hiding during discovery a sum of money received. It is denied in all other aspects. Signed by Judge B. Lynn Winmill. (km)
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF IDAHO
ELI DUNN and COLIN ALLEN,
Case No. 1:15-cv-479-BLW
Plaintiffs,
MEMORANDUM DECISION AND
ORDER
v.
BRYCE HATCH and HATCH MARINE
ENTERPRISE, LLC, in personam; the F/V
SILVER BULLET, Official Number
991159, her engines, machinery,
appurtenances and cargo, in rem;
Defendants
________
INTRODUCTION
The Court has before it plaintiff Dunn’s request for attorney fees as a sanction for
the conduct of defendant Hatch. For the reasons expressed below, the Court will award
$5,025.25 in fees for Hatch’s forgery of the employment contract, and an additional
$5,000 in fees for Hatch’s failure to reveal in discovery the payment adjustment figure.
The Court will explain these conclusions after reviewing the background of this
litigation.
LITIGATION BACKGROUND
Plaintiff Dunn brought this lawsuit to recover wages due him from shipowner
Hatch for the 2013 salmon season in Bristol Bay, Alaska. In a prior decision, the Court
held that Hatch forged Dunn’s signature on an employment contract, intentionally filed it
Memorandum Decision & Order – page 1
with the Court, represented in at least two court filings that Dunn signed the contract, and
procured two additional persons to lie, vouching for the authenticity of Dunn’s forged
signature. See Memorandum Decision (Dkt. No. 110). The Court held that this willful
conduct satisfied the high threshold for finding that Hatch acted in bad faith, and
warranted an award of sanctions. That award, the Court held, would consist of the
following items: (1) The costs of the handwriting expert Hannah McFarland – that is, her
fees for drafting her expert report and attending the deposition; and (2) The time Dunn’s
attorney spent in preparing for and taking the deposition of McFarland and in otherwise
addressing the issue of the contract forgery. Id. at p. 11.
In that decision, the Court also stated that “[i]f plaintiffs’ counsel believes he is
entitled to attorney fees generally, he shall file his motion within the same time frame,
thirty days. The Court expresses no opinion whether plaintiffs are entitled to costs and
attorney fees generally and, if so, whether those fees should be supplemental, or in
addition, to the costs and fees awarded as sanctions.” Id.
Dunn has now responded with two filings. In the first, he details the fees and costs
incurred in revealing the forgery. In the second – a motion for attorney fees generally –
he seeks all the attorney fees his attorney incurred in this case. The Court will take up
first the questions of the fees and costs for the forgery.
ATTORNEY FEES FOR FORGERY
Dunn’s counsel submits his accounting showing the following: (1) the costs for the
handwriting expert were $2,280.25; and (2) Dunn’s counsel spent 6.1 hours on this issue
Memorandum Decision & Order – page 2
at a rate of $450 an hour. Adding these amounts results in a sum of $5,025.25. See
Declaration of Merriam (Dkt. No. 111).
Hatch argues that the rate of $450 is too high, and cites lower hourly rates in the
Boise Idaho market. But Dunn’s counsel practices in a specialized field in Seattle
Washington, has done so for the past 36 years, and is a past chairman of the Maritime
Section of the Washington State Trial Lawyers Association. The Court finds his hourly
rate reasonable.
Hatch responds by speculating that Dunn had a contingent fee arrangement with
his counsel, making it unlikely that Dunn “incurred” any fees. But Hatch cites no
authority holding that fees cannot be awarded based on a finding of bad faith conduct in
litigation whenever the victim has a contingency fee arrangement. Adopting Hatch’s rule
would promote bad faith conduct in contingency cases, an absurd result.
Hatch complains about that the number of hours spent by Dunn’s counsel, but the
6.1 hours seems quite conservative given the importance of the issue in the litigation and
the burden of proving a signature was forged. The Court cannot find the total hours
unreasonable.
For these reasons, the Court will award $5,025.25 in attorney fees and costs for
Hatch’s conduct in forging the employment contract.
MOTION FOR ATTORNEY FEES GENERALLY
Legal Standard
An award of attorney’s fees is appropriate in admiralty only when the shipowner
acted arbitrarily, recalcitrantly, or unreasonably. Madeja v. Olympic Packers, LLC, 310
Memorandum Decision & Order – page 3
F.3d 628, 635 (2002). The district courts have discretion to award “punitive attorney
fees” when shipowners are “intentionally dishonest or recalcitrant during the course of
litigation.” Id. at 636.
Analysis
Dunn argues that Hatch avoided service of process, went to “incredible” lengths to
avoid paying Dunn’s wages, and filed a “blizzard of motions” to harass Dunn. See Brief
(Dkt. No. 112-1) at p. 4. Regarding the service of process, the Judge who transferred this
case here from the Western District of Washington – Chief Judge Donohue – denied
Dunn’s request to impose on Hatch the expense of service of process. See Order (Dkt.
No. 30). Chief Judge Donohue found that (1) Dunn’s counsel failed to comply with the
Rules regarding service; and (2) counsel’s failure contributed to the expenses that Dunn
sought to recover. Id. Hatch may have avoided the service of process but Dunn’s
counsel made his own missteps – it looks like a wash for attorney fee purposes.
The Court will turn next to Dunn’s allegation that Hatch’s counsel Kim Trout filed
a “blizzard” of harassing motions. A review of the arguments advanced in those motions
shows that they were largely an attempt to apply strictly the Federal Rules of Civil
Procedure, an entirely legitimate line of attack. Indeed, the motions were triggered by the
failure of Dunn’s counsel to follow the Rules: At one point the Court observed that
although it would deny the motions, it was “certainly troubled by the failure of plaintiffs’
counsel to follow the Rules.” See Memorandum Decision (Dkt. No. 102) at p. 3. Here
again, the Court can find no basis for an award of attorney fees.
Memorandum Decision & Order – page 4
This case was intensely contested, but that was due at least in part to Dunn’s claim
for punitive damages. That claim was in the case from 2014 until the Court struck the
claim in 2016, and it was one factor that led to intense litigation over an otherwise small
claim for unpaid wages.
Thus, much of the defense could be called zealous advocacy; nevertheless, part of
it did cross the line into obstructionism. During the period of discovery, Dunn
propounded interrogatories to Hatch asking for the “gross revenues” in 2013 and 2014.
Hatch responded on February 5, 2016, by referring to a certain settlement sheet from the
buyer of the salmon catch, Leader Creek Fisheries. That settlement sheet showed that
Leader Creek paid Hatch $184,274.52. See Answers to Interrogatories (Dkt. No. 78-2).
That response was highly misleading. Hatch knew when he answered those
interrogatories (on February 5, 2016) that almost two years earlier (in April of 2014)
Leader Creek had paid Hatch an additional sum of $19,504.53.1 See Exhibit B to Miller
Declaration (Dkt. No. 78-2). Dunn’s interrogatories had asked for Hatch’s gross
revenues in 2013 and 2014, and the $19,504.53 was clearly a revenue that Hatch knew
about when he answered those interrogatories but failed to reveal.
This was no small matter. From the very beginning of this lawsuit in 2014, Dunn
was trying to uncover the fact and amount of that payment, despite Hatch’s continual
1
Leader Creek paid a total of $19,504.53 in two payments; one in December of 2013 and the
other in April of 2014.
Memorandum Decision & Order – page 5
denials that it existed. So, Hatch’s failure to reveal the extra payment in response to the
interrogatory can only be characterized as a bad faith attempt to obstruct discovery.
Hatch had a chance to redeem himself. After he filed his misleading response,
about a month remained in the discovery process for him to file a supplemental response
revealing the payment. He failed to take advantage of that opportunity.
Instead, Hatch doubled down on his deception. He filed a motion for summary
judgment alleging that the record showed no price adjustment. See Motion for Summary
Judgment Brief (Dkt. No. 50). Dunn, skeptical of Hatch’s discovery responses, filed a
subpoena on Leader Creek for the final settlement sheet, and asked the Court for an
extension of time to respond to Hatch’s motion for summary judgment. The Court
granted that request for an extension.
In August of 2016, Leader Creek responded to Dunn’s subpoena and produced the
accurate settlement sheet showing the $19,504.53 extra payment. See Notice Filed by
Plaintiffs (Dkt. No. 66). Thus, the $19,504.53 sum was finally revealed through Dunn’s
own digging, not with any help from Hatch.
Hatch acted in bad faith to hide the $19,504.53 payment from Dunn during
discovery. His conduct was dishonest and recalcitrant. Under the authorities cited above,
that conduct warrants an award of attorney fees.
The issue is the scope of those fees. While Dunn wants an award of all his fees for
pursuing this lawsuit, the Court cannot find that Hatch’s dishonesty affected every aspect
of this case. As discussed above, Hatch often made legitimate arguments and pursued a
vigorous defense, while Dunn’s counsel at times failed to follow the Rules and caused his
Memorandum Decision & Order – page 6
own harm. But in two significant areas, Hatch’s dishonesty and bad faith resulted in
direct harm to Dunn: Hatch forged the employment contract and he hid the payment
adjustment from Leader Creek. For the former, the Court has already awarded $5,025.25.
The latter warrants a similar award because the harm caused, and the effort necessary to
uncover the truth, were comparable. Thus, an award of $5,000 in attorney fees is
appropriate for hiding the payment adjustment in discovery.
CONCLUSION
Following up on the Court’s prior award of attorney fees for the forged contract,
the Court will award plaintiff from defendant the sum of $5,025.25. In addition, the
Court will grant in part and deny in part Dunn’s motion for attorney fees generally. The
Court will award $5,000 in attorney fees for Hatch’s bad faith and dishonesty in failing to
reveal the payment adjustment of $19,504.53 in response to discovery requests. The
motion will be denied to the extent it seeks an award of all the attorney fees incurred by
plaintiff for this entire case.
The Court will therefore issue a separate judgment, as required by Rule 58(a), in
the total sum of $10,025.25, representing the attorney fees awarded to plaintiff from
defendant.
ORDER
In accordance with the Memorandum Decision set forth above,
NOW THEREFORE IT IS HEREBY ORDERED, that the plaintiff receive from
defendant the sum of $5,025.25 as attorney fees and costs as a sanction for the bad faith
conduct of defendant in submitting a forgery to the Court.
Memorandum Decision & Order – page 7
IT IS FURTHER ORDERED, that the motion for attorney fees generally (docket
no. 112) be GRANTED IN PART AND DENIED IN PART. It is granted to the extent it
seeks $5,000 in attorney fees as a sanction for the bad faith conduct in hiding during
discovery a sum of money received. It is denied in all other respects.
DATED: May 23, 2018
_________________________
B. Lynn Winmill
Chief U.S. District Court Judge
Memorandum Decision & Order – page 8
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?