Regions Bank v. Rooney et al

Filing 22

OPINION: Plaintiff's Request for Attorney's Fees (d/e 17 ) is GRANTED. Plaintiff is awarded attorney's fees in the amount of $55,733.96. Plaintiff is also awarded costs totaling $3,462.10. (SEE WRITTEN OPINION.) Entered by Judge Sue E. Myerscough on 11/29/2018. (GL, ilcd)

E-FILED

Thursday, 29 November, 2018 09:47:59 AM
Clerk, U.S. District Court, ILCD

IN THE UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF ILLINOIS
SPRINGFIELD DIVISION
REGIONS BANK,

)
)
Plaintiff,
)
)
v.
)
)
JOHN L. ROONEY, DAVID G.
)
LANTERMAN, CAPITOL
)
STRATEGIES, INC., CAPITOL
)
STRATEGIES CONSULTING, INC., )
CAPITOL STRATEGIES STAFFING )
SOLUTIONS, INC.,
)
MMIL PROPERTIES, INC., and
)
MMIL HOLDINGS, LLC, SERIES I, )
)
Defendants.
)

No. 3:18-CV-03100

OPINION
SUE E. MYERSCOUGH, U.S. District Judge.
This cause is before the Court on Plaintiff Regions Bank’s
Request for Attorney’s Fees (d/e 17) totaling $55,733.96. Because
Plaintiff has demonstrated that the fees are commercially
reasonable, the Request is GRANTED. Plaintiff is also awarded
costs totaling $3,462.10.

Page 1 of 10

I.

BACKGROUND

In May 2018, Plaintiff filed a Complaint (d/e 1) against
Defendants John L. Rooney, David G. Lanterman, Capitol
Strategies, Inc., Capitol Strategies Consulting, Inc., Capital
Strategies Staffing Solutions, Inc., MMIL Properties, Inc., and
MMIL Holdings, LLC Series I alleging that Defendants breached
certain Guarantees they executed in favor of Plaintiff. Specifically,
Plaintiff alleged that non-defendant MMIL Entertainment, LLC
executed, among other documents, a U.S. Small Business
Administration Note (Note) in favor of Plaintiff. Compl. ¶ 12. In
addition, each Defendant executed a U.S. Small Business
Administration Unconditional Guarantee guaranteeing payment to
Plaintiff of all obligations and indebtedness of MMIL
Entertainment, LLC in favor of Plaintiff. Id. ¶ 13. MMIL
Entertainment defaulted on its obligations under the Note. Id. ¶
15. Plaintiff alleged that Defendants failed and refused to pay their
obligations due and owing under the Guarantees. Id. ¶ 16.
Plaintiff sought $3,929,304.49, the total amount due and
outstanding under the Note. Id. ¶ 17. Plaintiff also sought
attorney’s fees based on the language in the Guarantees providing
Page 2 of 10

that “Guarantor promises to pay all expenses Lender incurs to
enforce this Guarantee, including, but not limited to, attorney’s
fees and costs.” See, e.g., Guarantee (d/e1-4); Compl. ¶ 18.
Defendants filed an Answer (d/e 4) denying that they failed and
refused to pay their obligations due and owing under the
Guarantees. Id. ¶ 16
On September 4, 2018, Plaintiff filed a Motion for Summary
Judgment (d/e 13). Defendants did not file a response. On
October 1, 2018, Plaintiff filed a Reply (d/e 14) stating that
Defendants had indicated that they did not intend to file a
response.
On October 4, 2018, this Court granted the Motion for
Summary Judgment, noting:
On October 3, 2018, United States Magistrate Judge
Tom Schanzle-Haskins held a telephone status
conference with counsel for Plaintiff and counsel for
Defendants regarding setting the case for mediation.
See October 3, 2018 Minute Entry. The parties declined
mediation but requested entry of judgment
incorporating the terms set forth in paragraphs (a), (b),
(c), and (d) of Plaintiff’s Reply in Support of its Motion for
Summary Judgment. Id.
See Order (d/e 15). Judgment was entered in favor of Plaintiff and
against each Defendant, jointly and severally, in the amount of
Page 3 of 10

$3,966,169.14 plus attorney’s fees and costs. See Judgment (d/e
16).
On October 17, 2018, Plaintiff filed its Request for Attorney’s
Fees (d/e 17). Plaintiff seek attorney’s fees totaling $55,733.96 for
services rendered between November 2017 and October 2018.
Plaintiff supports the request with the Declaration of Jacqueline K.
Graves and billing summaries. Plaintiff also filed a Bill of Costs
(d/e 18) with supporting invoices seeking costs totaling
$3,462.10.1
Plaintiff asserts that it hired the law firm of Lewis Rice LLC to
enforce its rights under the Note and Guarantees. This included
conducting pre-foreclosure work for both the property owned by
MMIL Entertainment LLC and for property owned by Defendants,
which were secured by various mortgages executed in favor of
Plaintiff. Lewis Rice handled the prosecution of Plaintiff’s efforts to
enforce its rights under the Note, Guarantees, and the various

Plaintiff originally sought costs totaling $3,708.10, which included costs for
two attorney admission fees even though only one attorney entered her
appearance in this case. After the Court inquired about the request, Plaintiff
withdrew its request for one of the requested attorney admission fees and the
fee for the Certificate of Good Standing. See Reply at 3 (d/e 21).
1

Page 4 of 10

mortgages held by Plaintiff since November 2017, all of which are
inextricably intertwined.
In her Declaration, Graves, the attorney of record for Plaintiff
in this case, asserts that the rates charged by Lewis Rice reflect
less than its then-prevailing customary charges to its clients for
services of the type involved in this case, as the fees charged were
at least 25% below the firm’s normal hourly rate. Graves attached
to her Declaration detailed time entries for the fees, which are kept
by Lewis Rice in the ordinary course of its regularly conducted
business activities.
Defendants filed a Response (d/e 20) asserting that they do
not dispute the hourly rates charged by the various attorneys or
the skill, experience, and education of the attorneys. Defendants
do, however, dispute the reasonableness of the total fees
requested. Defendants assert that $55,000 in attorney’s fees for a
five-month lawsuit that was basically conceded is not reasonable.
Moreover, Defendants acknowledge that work must be done prior
to the initiation of litigation. They argue, however, that expending
$35,374.84—nearly two-thirds of the total fees requested—in

Page 5 of 10

preparation of a simple, virtually uncontested case is not
reasonable.
In its Reply, Plaintiff asserts that the Note and Guarantee are
secured by various Future Advance Mortgages, giving Plaintiff a
security interest in 36 separate parcels of real property in four
counties, as well as an Assignment of Rents and various UCC
Financing Statements. The underlying real estate serves as
collateral for the loan by Plaintiff as well as loans to Defendants by
other banks. Plaintiff asserts that, to assess its rights and
remedies under the Note and Guarantees, and to properly enforce
Plaintiff’s rights under the Guarantees, it was necessary for Lewis
Rice to undertake a review and analysis of the entire loan file, as
well as to conduct a collateral analysis. In addition, because the
Note and Guarantees are guaranteed by the Small Business
Administration, Plaintiff and its attorneys had to work closely with
the Small Business Administration in pursing Plaintiff’s rights and
remedies.
II.

ANALYSIS

The jurisdictional basis for this case is diversity jurisdiction.
Compl. ¶ 8. Therefore, Illinois substantive law and federal
Page 6 of 10

procedural law applies. See Fednav Int’l Ltd. v. Cont’l Ins. Co., 624
F.3d 834, 838 (7th Cir. 2010). Under Illinois law, a court may
award attorney’s fees allowed by statute or by contract so long as
the fees are reasonable. Career Concepts, Inc. v. Synergy, Inc.,
372 Ill. App. 3d 395, 405 (2007). However, the method used to
determine whether the amount sought is reasonable is procedural
and, therefore, governed by federal law. See Taco Bell Corp. v.
Cont’l Cas. Co., 388 F.3d 1069, 1076 (7th Cir. 2004); Metavante
Corp. v. Emigrant Sav. Bank, 619 F.3d 748, 774 n. 21 (7th Cir.
2010). This is because the review of contractual fee petitions
involves requirements of proof that “concern how a particular court
system, having regard for its resource constraints and the
competing claims on its time, balance the cost of meticulous
procedural exactitude against the benefits in reducing error costs.”
Taco Bell, 388 F.3d at 1076.
Under federal procedural law, the court reviewing a request
for fees based on a contractual fee-shifting agreement does not
need to scrutinize each billing entry. Rexam Beverage Can Co. v.
Bolger, 620 F.3d 718, 738 (7th Cir. 2010) (“The district court was
not obligated to conduct a line-by-line review of the bills to assess
Page 7 of 10

the charges for reasonableness.”). Instead, federal district courts
determine whether the attorney’s fees sought pursuant to a
contract are commercially reasonable. See Medcom Holding Co. v.
Baxter Travenol Labs., Inc., 200 F.3d 518, 520-21 (7th Cir. 1999)
(noting that reasonableness is assessed using the “market’s
mechanisms”). That is, the Court reviews the moving party’s
overall costs to ensure that the costs are reasonable in relation to
the stakes of the case and the non-moving party’s litigation
strategy. Id. at 521. In particular, evidence that the client paid
the fees when recovery was uncertain is an indicator of
reasonableness. Id. (“If the bills were paid, this strongly implies
that they meet market standards.”).
After reviewing Plaintiff’s Request for Fees and the history of
the case, the Court finds that Plaintiff’s attorney’s fees are
commercially reasonable. The fees are reasonable in light of the
stakes of the case. Plaintiff seeks attorney’s fees totaling
$55,733.96. The amount at stake in the case totaled nearly $4
million dollars.
Moreover, the bulk of attorney’s fees-approximately $35,000—
were incurred prior to filing suit and, presumably, prior to knowing
Page 8 of 10

that Defendants were not going to vigorously defend the case. The
Court also find that these fees were necessary and reasonable for
Plaintiff’s efforts to enforce the Guarantee.
Finally, the records submitted by counsel for Plaintiff reflect that
Plaintiff largely paid the legal bills as they were incurred and at a
time when Plaintiff’s recovery of those fees from Defendants was
uncertain. See Balcor Real Estate Holdings, Inc. v. WalentasPhoenix Corp., 73 F.3d 150, 153 (7th Cir. 1996) (The “best
evidence of the market value of legal services Is what people pay for
it.”). Although some bills were outstanding when Plaintiff filed the
Request for Attorney’s Fees, the records show that Plaintiff has
paid between $38,000 and $46,000 of the fees. Because the
evidence demonstrates that the fees were commercially reasonable,
Plaintiff is entitled to recover its attorney’s fees in the amount of
$55,733.96.
III.

CONCLUSION

For the reasons stated, Plaintiff’s Request for Attorney’s Fees
(d/e 17) is GRANTED. Plaintiff is awarded attorney’s fees in the
amount of $55,733.96. Plaintiff is also awarded costs totaling
$3,462.10.
Page 9 of 10

ENTERED: November 29, 2018
FOR THE COURT:
s/Sue E. Myerscough
SUE E. MYERSCOUGH
UNITED STATES DISTRICT JUDGE

Page 10 of 10