Retiree, Inc. v. Anspach et al

Filing 103

MEMORANDUM AND ORDER: That Plaintiff Retiree, Inc.'s 93 Motion for Award of Attorney Fees and Costs is GRANTED for a total award of $98,993.43 in reasonable attorney's fees and expenses from Defendant Anspach. Signed by District Judge Julie A. Robinson on 3/27/2015. (bw)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS

RETIREE, INC.,
Plaintiff,
vs.
DANA ANSPACH, and
SENSIBLE MONEY, LLC,
Defendants.

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Case No. 12-2079-JAR

MEMORANDUM AND ORDER
Plaintiff Retiree, Inc. (“Retiree”) filed this action against Defendants Dana Anspach
(“Anspach”) and Sensible Money, LLC, seeking to permanently enjoin Defendants from
violating the confidentiality and non-compete agreement entered into by Anspach and Retiree
(the “Agreement”) and to enforce the liquidated damages provision contained in the Agreement.
The Court granted judgment in favor of Retiree on both claims.1 Before the Court is Plaintiff
Retiree, Inc.’s Motion for Award of Attorneys’ Fees and Costs (Doc. 93) that is now fully
briefed. Defendants responded to the motion, indicating that if Retiree is entitled to an award of
fees and costs, Defendants do not object to the reasonableness of the amounts sought in Retiree’s
motion. As explained more fully below, Retiree’s motion for attorneys’ fees and expenses is
granted for a total award of $98,993.43 in reasonable attorneys’ fees and expenses.
I.

Entitlement to Attorneys’ Fees
In Kansas, attorneys’ fees cannot be granted without statutory authority or by agreement.2

1

Doc. 102.

2

Johnson v. Westhoff Sand Co., 135 P.3d 1127, 1135 (Kan. 2006).

The Agreement, which Retiree and Defendant Anspach entered into, provides that “[t]he losing
party agrees to pay to the prevailing party all costs, including attorneys’ fees, incurred in
enforcing this agreement.” Kansas law enforces these types of contract terms.3 Retiree is
therefore entitled to an award of its reasonable attorneys’ fees and costs from Defendant
Anspach.
II.

Reasonableness of Attorneys’ Fees
The burden is on the party requesting the fees to show their reasonableness.4

Reasonableness is determined by applying the factors set forth in KRPC 1.5(a): (1) the time and
labor required, the novelty and difficulty of the questions involved, and the skill requisite to
perform the legal services properly; (2) the likelihood, if apparent to the client, that the
acceptance of the particular employment will preclude other employment by the lawyer; (3) the
fee customarily charged in the locality for similar legal services; (4) the amount involved and the
results obtained; (5) the time limitations imposed by the client or the circumstances; (6) the
nature and length of the professional relationship with the client; (7) the experience, reputation,
and ability of the lawyer or lawyers performing the services, and (8) whether the fee is fixed or
contingent.5 No one factor should dominate under the Court’s inquiry.6 A trial judge, based
upon experience and knowledge of the legal profession, is deemed an expert on attorney’s fees

3

See Boston Hannah Int’l, LLC v. Am. Acad. of Family Physicians, Case No. 10-2510-CM, 2012 WL
137870, at *9 (D. Kan. Jan. 18, 2012) (citing Farmers Cas. Co. v. Green, 390 F.2d 188, 192 (10th Cir.1968)).
4

Westar Energy, Inc. v. Lake, 552 F.3d 1215, 1229 (10th Cir. 2009); Westar Energy v. Wittig, 235 P.3d 515,
532 (Kan. Ct. App. 2010).
5

See Johnson, 135 P.3d at 1135–36.

6

Id. at 1142.

2

and may draw on that expertise in rendering an award in a particular case.7 The determination of
the reasonable value of attorney’s fees lies within the sound discretion of the trial court.8
In ruling on the reasonableness of the time and labor expended in the litigation of this
case, the Court must begin by determining the amount of hours reasonably expended on the
litigation. The burden is on the applicant to prove that the hours billed are reasonable “by
submitting meticulous, contemporaneous time records that reveal, for each lawyer for whom fees
are sought, all hours for which compensation is requested and how those hours were allotted to
specific tasks.”9 Retiree has submitted its billing invoices and expense reports to support its
requested fees and expenses.10 Retiree seeks attorneys’ fees in the amount of $90,034 and
expenses in the amount of $8,959.43. The attorneys’ fees represent approximately 649 hours
expended by Plaintiff’s counsel, Joel B. Laner, billed at the rate of $140 per hour.11
A.

Application of Reasonableness Factors to Fee Request
a.

The time and labor required; the novelty and difficulty of the
questions involved; and the skill requisite to perform the legal service
properly

The resolution of this case required two separate four-day hearings: a preliminary
injunction hearing and a permanent injunction/damages hearing. In addition to the preparation
7

Thoroughbred Assocs., LLC v. Kansas City Royalty Co., LLC, 248 P.3d 758, 774 (Kan. Ct. App. 2011),
aff’d in part and rev’d in part, 308 P.3d 1238 (Kan. 2013).
8

See City of Wichita v. BG Prods., Inc., 845 P.2d 649, 653 (Kan. 1993).

9

Case v. Unified Sch. Dist. No. 233, 157 F.3d 1243, 1250 (10th Cir.1998); Kan. Penn Gaming, LLC v. HV
Props. of Kan., LLC, 790 F. Supp. 2d 1307, 1316 (D. Kan. 2011).
10

Docs. 93–2 and 93–3.

11
The Court notes that fourteen hours of the total 649 hours appears to be billed by an attorney with the
initials “SGH.” The billing rate for those fourteen hours, however, was also $140 per hour.

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for and appearance at eight days of hearings, substantial discovery, prior to the preliminary
injunction hearing, as well as substantial briefing throughout the case occurred. Among other
pleadings, Retiree filed Motions in Limine, which were granted in part, and Trial Briefs as well
as a motion for contempt.
The case possessed novel and difficult features. In particular, the case required a
familiarity with: (I) trends in the retirement planning industry; (ii) the business propositions of
the market leaders; (iii) features of household asset and income aggregation; (iv) Social Security
timing, election strategies, and taxation; (v) asset location; (vi) asset allocation; (vii) withdrawal
sequencing; (viii) Roth IRAs; (ix) retirement income taxation; (x) web-based marketing;
(xi) Excel spreadsheets; and (xii) the market for retirement income planning products and
services. The skill required to perform the legal services properly is, at least, that of an average
attorney.
The Court finds that the hours spent by Plaintiff’s counsel are generally supported by
meticulous, contemporaneous time records that show the Court how counsel’s time was spent on
specific tasks related to this lawsuit. The Court finds that the number of hours spent on this
litigation was reasonable given the time and labor involved, the novelty and difficulty of the
questions involved, and the skill requisite to perform the legal services in this case properly.
b.

The likelihood, if apparent to the client, that the acceptance of the
particular employment will preclude other employment by the lawyer

There is no evidence in the record that Plaintiff’s counsel turned away other work
because of its work on the instant matter, however, counsel notes that because of the grave threat
to the confidentiality of Retiree’s proprietary information and its goodwill, enterprise value, and
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industry status posed by Defendants’ violation of their covenants, Retiree believed it needed to
act vigorously to protect its confidential information and business. Retiree requested that its
counsel devote the time necessary to defend its interests and implicitly, if not explicitly,
appreciated that counsel could not work on other matters while working on discovery, briefing,
trial preparation, and trial in this case. Given the effort and manpower expended on this case, it
appears clear that Plaintiff’s counsel worked on this case at the expense of other work.
Nonetheless, the Court does not view this factor as relevant to determining the requested fees in
this matter. The Court will consider, in conjunction with the other factors, whether the “total fee
is reasonable for the work required.”12
c.

Fee customarily charged in the locality for similar legal services

Under this factor, the Court considers the rates of the attorneys and support staff who
worked on this case. In examining the hourly rate, the court is to refer “to the prevailing market
rates in the relevant community.”13 “The first step in setting a rate of compensation for the hours
reasonably expended is to determine what lawyers of comparable skill and experience practicing
in the area in which the litigation occurs would charge for their time.”14 In making this
determination, if the court does not have before it adequate evidence of prevailing market rates,
the court may, in its discretion, “use other relevant factors, including its own knowledge, to
establish the rate.”15

12

Moore v. St. Paul Mercury Ins. Co., 989 P.2d 294, 295 (Kan. Ct. App. 1994).

13

Blum v. Stenson, 465 U.S. 886, 895 (1984).

14

See Case v. Unified School Dist. No. 233, 157 F.3d 1243, 1256 (10th Cir. 1998).

15

Lippoldt v. Cole, 468 F.3d 1204, 1225 (10th Cir. 2006) (citing Case, 157 F.3d at 1257).

5

Because of the long-term relationship with Retiree, Inc. and Mr. Meyer, Plaintiff’s
counsel charged Retiree $140.00 an hour. The Court finds that this hourly rate is at least in line
with, if not below, the prevailing market rates for lawyers of comparable skill and experience
practicing in the Kansas City area.
d.

The amount involved and the results obtained

Retiree was successful in obtaining a $500,000 liquidated damages award, as well as a
permanent injunction. At stake in the case were Retiree’s preeminent position in the retirement
planning industry, in particular in the decumulation segment and, perhaps, its present and future
value.
The Court finds the amount of the requested fees and expenses reasonable in relation to
the significant amount of damages awarded in this matter. The results obtained further
substantiate the reasonableness of the award.
e.

The time limitations imposed by the client or by the circumstances

Although Retiree argues that the circumstances imposed a special urgency in stopping
Defendants’ violation of the confidentiality agreement, the Court does not find this to be a
significant factor in determining a reasonable fee.
f.

The nature and length of the professional relationship with the client

Plaintiff’s counsel’s firm, and in particular Plaintiff’s counsel, has been performing
general legal services for Retiree, Inc, and Mr. Meyer since October, 2008. Retiree, Inc. has
entrusted the firm with responsibility for the care and protection of its legal interests. Given the
nature and length of the attorney-client relationship in this matter, Retiree’s fee request is
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reasonable.
g.

The experience, reputation, and ability of the lawyer or lawyers
performing the services

Plaintiff’s counsel has been in practice for nearly 30 years, Martindale Hubbell has given
him its highest AV rating, and he states that he has been engaged by judges in the metropolitan
area to represent them in miscellaneous legal matters.
The Court has thoroughly reviewed all of this evidence and has presided over this case
from its inception, witnessing the abilities of Retiree’s attorney first-hand. The Court finds that
Retiree’s attorney enjoys an outstanding professional reputation and was highly qualified to
prosecute and try this complex and lengthy matter.
h.

Whether the fee is fixed or contingent

Retiree, Inc. agreed to pay Hazelton & Laner, LLP its hourly fee. As a consequence,
the fee is fixed.
3.

Reasonable Expenses

Retiree seeks $8,959.43 in expenses. The expense categories sought include charges for
photocopies, mileage, FedEx, deposition costs and court reporter costs. Defendants have not
objected to any of the items included in this request, and the Court finds that all expense items
are reasonable, for a total award of $8,959.43.
4.

Total Award

The Court has considered all of the reasonableness factors set forth in Rule 1.5(a), as well
as Plaintiff’s submissions, and finds Plaintiff’s requested hours and rates are reasonable.
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Plaintiff is therefore awarded the following reasonable attorney fees and expenses against
Defendant Anspach: $90,034 in reasonable attorneys’ fees, and $8,959.43 in expenses.
IT IS THEREFORE ORDERED BY THE COURT that Plaintiff Retiree, Inc.’s
Motion for Award of Attorneys’ Fees and Costs (Doc. 93) is granted for a total award of
$98,993.43 in reasonable attorneys’ fees and expenses from Defendant Anspach.
IT IS SO ORDERED.
Dated: March 27, 2015
S/ Julie A. Robinson
JULIE A. ROBINSON
UNITED STATES DISTRICT JUDGE

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