Dennis v. GOCOM Media of Illinois LLC
Filing
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OPINION: The Plaintiff's Motion for an Award of Attorny's Fees and Costs (d/e 20 ) is ALLOWED. The Defendant shall pay the Plaintiff's attorney's fees and costs in the amount of $18,148.25. The Clerk shall enter an Amended Judgment accordingly. SEE WRITTEN OPINION. Entered by Judge Richard Mills on 1/15/2014. (MJ, ilcd)
E-FILED
Wednesday, 15 January, 2014 03:38:06 PM
Clerk, U.S. District Court, ILCD
IN THE UNITED STATES DISTRICT COURT
FOR THE CENTRAL DISTRICT OF ILLINOIS
SPRINGFIELD DIVISION
GERALDINE DENNIS,
Plaintiff,
v.
GOCOM MEDIA OF ILLINOIS,
LLC,
Defendant.
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NO. 10-3125
OPINION
RICHARD MILLS, U.S. District Judge:
Pending before the Court is the Plaintiff’s Motion for an Award of
Attorney’s Fees and Costs.
I. BACKGROUND
Plaintiff Geraldine Dennis filed suit against Defendant GOCOM
Media of Illinois, LLC. The Plaintiff’s Amended Complaint asserted three
violations of Title VII of the Civil Rights Act of 1964, based on gender
discrimination, see 42 U.S.C. § 2000e-2, and retaliation, see 42 U.S.C. §
2000e-3(a).
Following the Defendant’s Answer, the parties filed a Joint Motion for
Referral to Mediation with the Court. The parties were referred to United
States Magistrate Judge Byron G. Cudmore for the purposes of mediation.
The parties participated in a mediation session facilitated by Judge
Cudmore. They engaged in cooperative negotiation in an attempt to reach
agreement and avoid litigation. Eventually, the Defendant offered to settle
the matter for $70,000. The Defendant informed the Plaintiff that if this
sum was not accepted, an Offer of Judgment under Rule 68 of the Federal
Rules of Civil Procedure would be entered immediately thereafter in that
proposed amount. The Plaintiff refused the offer. The docket reflects that
the mediation ended without success.
Consistent with its promise, the Defendant filed an Offer of
Judgment, which was accepted by the Plaintiff.1 See Doc. Nos. 16 & 17.
The Offer stated:
Federal Rule of Civil Procedure 68(a) provides:
At least 14 days before the date set for trial, a party defending
against a claim may serve on an opposing party an offer to allow
judgment on specified terms, with the costs then accrued. If,
within 14 days after being served, the opposing party serves
written notice accepting the offer, either party may then file the
offer and notice of acceptance, plus proof of service. The clerk
must then enter judgment.
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NOW COMES Defendant, GOCOM Media OF Illinois LLC, by
and through its attorneys, Brown, Hay & Stephens, LLP,
pursuant to Rule 68 of the Federal Rules of Civil Procedure
(Fed. R. Civ. P. 68), and submits to Plaintiff Geraldine Dennis
an Offer of Judgment in the amount of $70,000, with costs
accrued.
Following the Plaintiff’s acceptance of the Offer of Judgment, the Court
entered an Order which stated:
Pursuant to Federal Rule of Civil Procedure 68(a), the
Clerk of Court is directed to enter judgment in favor of Plaintiff
Geraldine Dennis and against Defendant GOCOM Media of
Illinois LLC in the amount of $70,000, with costs accrued.
See Doc. No. 18. Judgment was entered pursuant to the Order. See Doc.
No. 19. The Defendant states that Plaintiffs’ Counsel requested that
payment be made to the Plaintiff and Plaintiff’s Counsel’s firm.
Accordingly, the check was made payable to Geraldine Dennis and the firm
of Baker, Baker & Krajewski, LLC.
Subsequently, the Plaintiff moved for an award of attorney’s fees and
costs.
II. DISCUSSION
A. Plaintiff’s entitlement to fees
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The Plaintiff’s claims were brought pursuant to Title VII, which
includes a provision for the recovery of attorney’s fees as part of the costs
of litigation. (“In any action or proceeding under this subchapter the court,
in its discretion, may allow the prevailing party . . . a reasonable attorney’s
fee . . . as part of the costs[.]” 42 U.S.C. § 2000e-5(k)). “In order to be
considered a prevailing party in a civil rights action, a plaintiff must obtain
at least some relief on the merits.” Alexander v. Gerhardt Enterprises, Inc., 40
F.3d 187, 194 (7th Cir. 1994) (internal quotation marks and citation
omitted).
If costs are defined in the underlying statute to include
attorney’s fees, “the court may award fees as part of costs as well.” Webb
v. James, 147 F.3d 617, 622 (7th Cir. 1998).
In Marek v. Chesny, 473 U.S. 1 (1985), the United States Supreme
Court considered whether “costs” are necessarily included in a Rule 68
offer. See id. at 6. The Court determined it depends on the how the offer
is worded:
The critical feature of this portion of the Rule is that the
offer be one that allows judgment to be taken against the
defendant for both the damages caused by the challenged
conduct and the costs then accrued. In other words, the
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drafters’ concern was not so much with the particular
components of offers, but with the judgments to be allowed
against defendants. If an offer recites that costs are included or
specifies an amount for costs, and the plaintiff accepts the offer,
the judgment will necessarily include costs; if the offer does not
state that costs are included and an amount for costs is not
specified, the court will be obliged by the terms of the Rule to
include in its judgment an additional amount which in its
discretion, it determines to be sufficient to cover the costs.
Id. (internal citation omitted).
In Sanchez v. Prudential Pizza, Inc., 709 F.3d 689 (7th Cir. 2013), the
United States Court of Appeals for the Seventh Circuit considered “the
problems posed by ambiguous offers of judgment under Rule 68 of the
Federal Rules of Civil Procedure.” See id. at 690. The court emphasized the
importance of being “specific and clear” in making the offers because “[a]ny
ambiguities will be resolved against them.” Id.
In Sanchez, the offer referred to the plaintiff’s “claims for relief.” See
id. at 692. The defendant argued that because the plaintiff requested
attorney’s fees and costs in her amended complaint, attorney’s fees were
thus included in the Rule 68 offer. See id. The Seventh Circuit noted that
because the offer did not specify what the “claims” were, the plaintiff would
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have had to guess the meaning of the offer. See id. at 692-93. This
rendered the offer ambiguous. See id. at 693. The court concluded that
because attorney’s fees are not part of a plaintiff’s claim, the defendant’s
offer of judgment was silent as to attorney’s fees. See id.
The Offer of Judgment at issue here provides for the amount
($70,000), “with costs accrued.” The Defendant contends that, during the
parties’ negotiations, every demand, offer and counteroffer exchanged was
intended and understood by the parties to constitute a lump sum for
settlement of all claims and any costs, fees, and expenses incurred as a
result of the litigation. After accepting the Offer, the Plaintiff’s counsel
requested that the $70,000 check be made payable to his law firm and to
the Plaintiff. The Defendant asserts this method of payment supports its
understanding that the amount was inclusive of all costs, including
attorney’s fees, then accrued.
It may well have been the parties’ understanding that the $70,000
included all costs, including attorney’s fees. However, the Offer did not
specify that the amount was inclusive of costs. Given one of the definitions
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of “with,” the phrase “$70,000, with costs accrued” can be read as $70,000,
accompanied by costs.2
As the drafter of the Offer, any ambiguity is
resolved against the Defendant. See Sanchez, 709 F.3d at 694.
The Plaintiff points to Erdman v. Cochise County, Arizona, 926 F.2d 877
(9th Cir. 1991), wherein the offer contained language very similar to the
Offer in this case. The offer of judgment in Erdman stated:
The City of Douglas, pursuant to Rule 68, Federal Rules of Civil
Procedure, offers to allow judgment to be taken against the City
of Douglas for the sum of SEVEN THOUSAND FIVE
HUNDRED DOLLARS ($7,500.00) with costs now accrued.
Id. at 878. The defendant claimed the offer had been “inartfully drafted”
and that the attorney’s fees were meant to be included in the lump sum
amount.
See id. at 879.
The Ninth Circuit rejected the defendant’s
argument and held that plaintiff was “entitled to rely on the plain language
of the offer he accepted, ‘$7,500 with costs now accrued,’ which under
Marek . . . entitled him to a reasonable attorney’s fee award in addition to
the lump sum named in the offer.” Id.
2
The first definition of “with” at dictionary.com is “accompanied by;
accompanying: I will go with you. He fought with his brother against the enemy.”
http://dictionary.reference.com/browse/with (last visited January 7, 2014).
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It appears that the Offer in this case was inartfully drafted as well.
The Defendant may well have intended the Offer to be inclusive of any fees
and costs. However, the language of the Offer is not consistent with that
intent. Because the Seventh Circuit emphasized the importance of clarity
in drafting Rule 68 offers and stated that any ambiguities will be resolved
against the drafter, see Sanchez, 709 F.3d at 690, this Court agrees with the
Ninth Circuit’s interpretation of very similar language in Erdman and
concludes that based on the plain language of the Offer, the Plaintiff is
entitled to an award of her costs which under Title VII includes reasonable
attorney’s fees.
B. Amount of fees
The Plaintiff’s Motion included an Affidavit of Counsel, the
Representation Agreement between the law office and the Plaintiff and a
copy of the billing statement. See Doc. No. 20. At the Court’s Direction,
the Plaintiff filed a supplemental billing statement and Affidavit of Counsel.
In cases in which attorney’s fees are authorized, “a prevailing plaintiff
should ordinarily recover an attorney’s fee unless special circumstances
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would render such an award unjust.” Hensley v. Eckerhart, 461 U.S. 424,
429 (1983). Generally, a plaintiff is determined to be a “prevailing party”
if she succeeds on any significant issue which achieves some of the benefit
she sought in pursuing litigation. See id. at 433.
The Defendant contends that Plaintiff is not a prevailing plaintiff
entitled to an award of costs and fees under Title VII. In Fletcher v. Fort
Wayne, 162 F.3d 975 (7th Cir. 1998), the Seventh Circuit upheld the
district court’s determination that a plaintiff who demanded $150,000 to
settle the case under Rule 68 before accepting $5,000 plus costs and
another who demanded $30,000 but accepted $2,500 would not be
considered prevailing plaintiffs. See id. at 976-77. Rather, the settlements
reflected nuisance value. See id. at 978.
In Fisher v. Kelly, 105 F.3d 350 (7th Cir. 1997), the plaintiff filed a
civil rights action under 42 U.S.C. § 1983 and initially demanded $80,000
based on several claims. See id. at 352. After the defendant’s settlement
offer of $10,000 was rejected, the plaintiff accepted the defendant’s Rule
68 offer of judgment. See id. The district court granted $120 in costs, but
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denied an award of attorney’s fees because it found the plaintiff’s victory
was “technical or de minimis” and the case was settled because of its
“nuisance value.” See id.
The Defendant claims its Rule 68 offer was based on a cost-of-defense
analysis after recognizing that substantial costs and attorney’s fees would
be expended because, due to factual disputes in the record, the case did not
appear to be a likely candidate for summary judgment. The offer was not
made because of a belief that the Plaintiff had a likelihood of success on the
merits.
After considering the record, the Court concludes that the Plaintiff is
a prevailing party entitled to an award of costs and fees pursuant to Title
VII. Although the Amended Complaint does not include a monetary
demand, it is likely that Plaintiff would have sought significantly more than
$70,000 had this case proceeded to trial. However, $70,000 is still a
significant amount.
Both parties would have risked something by
proceeding to trial. If the jury were to return a verdict for the Defendant,
then the Plaintiff would have received nothing.
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Undoubtedly, the
Defendant considered attorney’s fees and costs if the case proceeded to
trial. However, by going to trial, the Defendant would have incurred those
costs and risked a significant verdict in favor of the Plaintiff.
Although it is not always easy to determine what constitutes a
“nuisance value settlement,” the Court believes that the Defendant would
have a stronger argument if the Offer of Judgment had been approximately
half the amount of the $70,000 actually offered. Based on all of the
circumstances, the Court concludes that Plaintiff is a “prevailing plaintiff”
who is entitled to fees under Title VII.
“The most useful starting point for determining the amount of a
reasonable fee is the number of hours reasonably expended on the litigation
multiplied by a reasonable hourly rate.” Id. “[A]n attorney’s actual billing
rate for comparable work is presumptively appropriate for use as a market
rate when making a lodestar calculation.” Jeffcoat, LLC v. Director, Office of
Workers’ Compensation Programs, 553 F.3d 487, 490 (7th Cir. 2009).
The agreement between the Plaintiff and Counsel was that she would
pay $250 per hour if there were a successful settlement. Although this case
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resulted in an Offer of Judgment under Rule 68, the Plaintiff acknowledges
that a Rule 68 Offer is more like a settlement than a verdict. Consequently,
the Plaintiff is requesting a fee based upon the $250.00 rate.3
The Court has reviewed Counsel’s Affidavit and finds that his hourly
rate is reasonable. Moreover, the number of hours expended by Counsel
appear to be properly documented and reasonably incurred. The Plaintiff
is requesting a total of $24,049.81, which includes $23,606.25 for
professional services rendered and total costs of $443.56.
The Court does not doubt the Defendant honestly believed that the
$70,000 was intended to represent a firm and all-inclusive offer.
Unfortunately for the Defendant, the ambiguity must be resolved against
the drafter of the language.
Because of these special circumstances–the Defendant’s apparent
honest mistake and good faith belief that $70,000 represented the entire
amount of the Offer–the Court will reduce the amount awarded for
professional services by $5,901.56, which is 25% of the amount requested
The Plaintiff’s Counsel is requesting that his paralegal be billed at a rate
of $75 per hour.
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by the Plaintiff. This results in an award of $17,704.69 for professional
services rendered. When $443.56 is added for costs, the total amount is
$18,148.25.
Ergo, the Plaintiff’s Motion for an Award of Attorney’s Fees and Costs
[d/e 20] is ALLOWED.
The Defendant shall pay the Plaintiff’s attorney’s fees and costs in the
amount of $18,148.25.
The Clerk shall enter an Amended Judgment accordingly.
ENTER: January 15, 2014
FOR THE COURT:
s/Richard Mills
Richard Mills
United States District Judge
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