JAB Energy Solutions II, LLC v. Servicio Marina Superior, L.L.C. et al

Filing 119

ORDER AND REASONS denying 102 Motion to Adjust Attorneys' Fees; granting in part and denying in part 101 Motion for Attorney Fees and Costs; denying without prejudice 100 Motion for Disbursement of Security Bond. Signed by Judge Ivan L.R. Lemelle. (ijg)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
JAB ENERGY SOLUTIONS II, LLC

CIVIL ACTION

VERSUS

NO. 13-556

SERVICIO MARINA SUPERIOR, L.L.C., ET AL.

SECTION “B”(4)

ORDER AND REASONS
Before the Court are three motions filed by the parties
following

the

United

States

Court

of

Appeals

for

the

Fifth

Circuit’s Judgment, issued as mandate, reversing this Court’s
Judgment on one of three issues presented. The first motion is
Plaintiff JAB Energy Solutions II, LLC’s (“JAB”) “Motion for
Disbursement of Security Bond.” Rec. Doc. 100.

JAB also filed a

“Motion for Attorney Fees and Legal Costs on Appeal.” Rec. Doc.
101.1 Finally, Defendant Servicio Marina Superior, LLC (“SMS”)
filed a “Motion to Adjust Award of Attorneys’ Fees” due to the
partial reversal on appeal. Rec. Doc. 102. Timely opposition
memoranda were filed with respect to each motion. The Court also
granted leave for JAB to file reply memoranda in support of its
motion for disbursement and motion for fees and costs on appeal.
For the reasons outlined below,

JAB originally filed its motion for attorneys’ fees on March 11, 2016, prior
to the Fifth Circuit issuing its Judgment as mandate. However, on April 21,
2016, JAB reurged its motion following the Judgment being issued as mandate,
incorporating by reference the previous motion. Accordingly, this Court
dismissed the original motion (Rec. Doc. 95) as moot considering the fact
that JAB incorporated the same arguments into its reurged motion (Rec. Doc.
101). See Rec. Doc. 104.
1

1

IT IS ORDERED that the Motion for Disbursement (Rec. Doc.
100) is DENIED WITHOUT PREJUDICE.
IT IS FURTHER ORDERED that the Motion for Attorney fees and
Legal Costs on Appeal (Rec. Doc. 101) is GRANTED in part and DENIED
in part.
IT IS FURTHER ORDERED that the Motion to Adjust Attorneys’
Fees (Rec. Doc. 102) is DENIED.
I.

FACTUAL BACKGROUND AND PROCEDURAL HISTORY
This case arises out of a contract between JAB and SMS

requiring SMS’s vessel, the Atlas, to tow a barge owned by Cashman
Equipment Corp. (“Cashman”) and an oil drilling platform from
Louisiana to Malaysia so that JAB could install the drilling
platform

in

Malaysia.

Rec.

Doc.

106

at

4.

After

the

Atlas

experienced repeated problems throughout the journey, forcing JAB
to locate another tug to complete the voyage, JAB filed suit
against SMS and Cashman for breach of contract. Id. at 4-5.
Following a bench trial, this Court issued its Reasons for Ruling
and Order in favor of JAB and against SMS and Cashman. Rec. Doc.
75. The Court granted judgment in favor of JAB in the amount of
$4,864,214.89, plus prejudgment interest from the date of judicial
demand. Id. at 42. It also awarded reasonable attorneys’ fees and
costs, to be determined at a later time. Id. Several weeks later,
the parties reached a joint stipulation with respect to attorneys’
fees. Rec. Doc. 81. While reserving “all rights to seek relief,
2

including

appeal,

on

all

entitlement

issues,”

the

parties

stipulated to $439,576.02 as a reasonable amount of attorneys’
fees. Id. at 1. Thereafter, the Court entered Judgment in favor of
JAB in a total amount of $5,303,790.91 plus prejudgment interest
from the date of judicial demand. Rec. Doc. 82.
Cashman and SMS then appealed three of this Court’s findings
to the United States Court of Appeals for the Fifth Circuit: (1)
that Cashman and SMS breached two warranties under the contract;
(2) that neither the contract’s terms nor any subsequent agreement
barred JAB’s claim; and (3) that Cashman was the alter ego of SMS.
Rec. Doc. 106 at 3-4. On appeal, the Fifth Circuit affirmed this
Court’s

judgment

“in

all

respects

as

to

SMS,”

affirmed

the

dismissal of Cashman’s counterclaim, and reversed “the judgment of
liability as to Cashman, which was predicated on an erroneous alter
ago finding.” Rec. Doc. 106 at 4. It then rendered judgment in
favor of Cashman on JAB’s claim against it. Id.
II.

DISCUSSION

The Court will begin by addressing the parties’ motions
regarding attorneys’ fees.
a. The Attorneys’ Fees Motions
1. The parties’ contentions
JAB’s motion seeks an award of $91,495.00 in legal fees and
$233.84 in costs billed by its counsel, Jones Walker, for its
appellate work. JAB maintains that an award of attorneys’ fees
3

incurred on appeal is justified by the Contract of Affreightment,
the Stipulation between the parties, and this Court’s Judgment.
Rec. Docs. 95-1 at 2; 101-1 at 2. JAB further contends that the
amount of fees sought is supported by a reasonable application of
the lodestar method. Rec. Doc. 95-1 at 4. In particular, JAB claims
that the billing rates of $325 per hour for partners and $190 per
hour for associates are eminently reasonable for this type of work
in this locale. Rec. Doc. 95-1 at 6-8. JAB further asserts that
the 350.6 hours expended is adequately documented and reasonable
under the circumstances. Rec. Doc. 95-1 at 8-10. For these reasons,
JAB urges the Court to grant its motion for attorneys’ fees.
SMS and Cashman oppose the motion primarily on the ground
that it is untimely under Federal Rule of Civil Procedure 54(d)(2)
because it was not filed within 14 days of this Court’s Judgment.
Rec. Doc. 108 at 2. Further, Defendants contend that JAB did not
properly reserve its right to seek appellate attorneys’ fees
because

the

Stipulation

did

not

expressly

address

appellate

attorneys’ fees and JAB did not provide a fair estimate of the
amount of such fees. Id. (citing to South Tex. Elec. Coop v.
Dresser-Rand Co., No.06-28, 2010 WL 1855959, at *4 (S.D. Tex. May
5, 2010)). In the alternative, if this Court finds that the motion
is timely, SMS and Cashman argue that JAB’S requested fees should
be reduced to account for JAB’s: (1) ultimately unsuccessful claim
against Cashman; and (2) failure to demonstrate billing judgment.
4

Rec. Doc. 108 at 13. Defendants also urge this Court to hold an
evidentiary hearing to properly analyze the amount of time spent
on claims related to SMS if JAB contends that fees sought against
SMS are indistinguishable from those against Cashman. Id.
JAB does not contest that it failed to file a motion for
appellate attorneys’ fees within the timeframe set by Rule 54(d).
Instead, it claims that Defendants’ reliance on Dresser-Rand is
misplaced because the court there stated that the parties could
reserve their rights to seek appellate attorneys’ fees, which JAB
maintains it did here.2 Rec. Doc. 99 at 2. Further, JAB contends
that appellate attorneys’ fees are usually ripe for consideration
only after an appeal is complete. Id. JAB therefore claims that it
is entitled to such fees.
Defendants also submitted their own motion to adjust the
amount of attorneys’ fees awarded pursuant to the parties’ earlier
Stipulation. Rec. Doc. 102. The essence of Defendants’ argument is
that the Stipulation calculated attorneys’ fees based on JAB’s
success against both Defendants at trial, but because judgment
against Cashman was reversed on appeal, the original attorneys’
fee award should be reduced accordingly. See Rec. Doc. 102-1.
Moreover, because the Stipulation permitted the parties to seek
relief on all entitlement issues, Defendants claim they should be

JAB, however, fails to identify the portion of the Dresser-Rand opinion to
which it refers.
2

5

permitted to seek a reduction in the amount of attorneys’ fees.
Id. at 2. Finally, Defendants maintain that granting their motion
is necessary to comply with the mandate rule, which requires a
lower court on remand to implement both the letter and spirit of
the appellate court’s mandate. Id.
In opposition, JAB claims that, even though entitlement to
attorneys’ fees was reserved under the Stipulation, Defendants’
did not effectively assert that right because they did not appeal
the issue. Rec. Doc. 105 at 1. Additionally, they claim that the
law of the case doctrine prohibits this Court from adjusting the
amount of attorneys’ fees awarded pursuant to the Stipulation
because the Fifth Circuit explicitly affirmed the judgment in all
respects as to SMS and did not remand for consideration of any
issues. Id. at 2.
2. Analysis
To prevent litigants from reasserting the same arguments time
and again, the law of the case doctrine provides that “an issue of
fact or law decided on appeal may not be reexamined either by the
district court on remand or by the appellate court on a subsequent
appeal.” U.S. v. Matthews, 312 F.3d 652, 657 (5th Cir. 2002)
(quoting Tollett v. City of Kemah, 285 F.3d 357, 363 (5th Cir.
2002)). Additionally, the mandate rule, “a specific application of
the general doctrine of law of the case,” requires a lower court
on remand to “implement both the letter and the spirit of the
6

appellate court’s mandate” and prevents the lower court from
disregarding the explicit directives of the appellate court. Id.
(quoting U.S. v. Becerra, 155 F.3d 740, 753 (5th Cir. 1998). There
are, however, three exceptions to the law of the case doctrine and
the mandate rule: “(1) The evidence at a subsequent trial is
substantially different; (2) there has been an intervening change
of law by a controlling authority; and (3) the earlier decision is
clearly erroneous and would work a manifest injustice.” Id. (citing
Becerra, 155 F.3d at 752-53).
Here,

the

Fifth

Circuit

did

not

remand

for

further

consideration of any issues. See Rec. Doc. 106. The mandate states
that this Court’s judgment of liability as to Cashman is reversed,
but it also affirms the judgment “in all respects as to SMS.” Id.
at 4. This Court reads the Fifth Circuit’s ruling as affirmatively
approving the amount of the award, in all respects, rendered for
JAB against SMS. Therefore, granting Defendants’ motion to reduce
the amount of attorneys’ fees included within the original Judgment
would constitute a refusal to implement, and a complete disregard
of,

the

letter

of

the

appellate

court’s

mandate.

Moreover,

Defendants do not argue for the application of any of the three
exceptions in this case. Accordingly, the mandate rule requires
this Court to deny Defendants’ motion to reduce the amount of
attorneys’ fees.

7

The same logic applies with respect to JAB’s request for
attorneys’ fees because any adjustment of the amount of fees would
alter the judgment against SMS that the Fifth Circuit explicitly
approved. Another reflection of the appellate court’s intent is
that it explicitly ordered that appellate costs be awarded to JAB
and against SMS but did not order such with respect to appellate
attorneys’ fees. See Rec. Doc. 106 at 2 (ordering that “Servicio
Marina Superior pay to the plaintiff-appellee the costs on appeal
to be taxed by the Clerk of this Court.”). See also ATEL Mar.
Inv’rs, LP v. Sea Mar Mgmt., L.L.C., No. 08-1700, 2015 WL 423308,
at *4 (E.D. La. Feb. 2, 2015) (noting that “[i]t has long been
held that ‘costs on appeal’ do not include attorneys’ fees,” and
refusing

to

“alter

the

Fifth

Circuit’s

mandate”

by

granting

appellate attorneys’ fees where the appellate court only awarded
costs).
Yet, even if the Fifth Circuit did not intend to deny JAB
access to appellate attorneys’ fees, this Court finds JAB’s motion
untimely under Rule 54(d)(2). Rule 54(d)(2)(A) provides that “[a]
claim for attorneys’ fees and related nontaxable expenses must be
made

by

motion.”

FED. R. CIV. P.

54(d)(2)(A).

Further,

Rule

54(d)(2)(B)(i) requires the motion “be filed no later than 14 days
after the entry of judgment.” FED. R. CIV. P. 54(d)(2)(B)(i). While
JAB may be correct that motions for appellate attorneys’ are not
ripe until after the appeal process ends, courts in this circuit
8

have explicitly found that the ripeness issue does not excuse a
party

from

meeting

Rule

54’s

requirement

that

a

motion

for

attorneys’ fees be filed within fourteen days of the district
court’s

judgment.3

See

ATEL,

2015

WL

423308,

at

*3

(denying

appellate attorneys’ fees where “[Plaintiff’s] initial fee motion
did not request appellate attorneys’ fees, indicate that appellate
attorney’s fees would be sought in the future, or provide a fair
estimate of any future fees”); Dresser-Rand, 2010 WL 1855959, at
*3-4 (denying appellate attorneys’ fees on the same grounds).
Here, JAB did not file its motion for attorney’s fees until
roughly nine months after this Court entered judgment. See Rec.
Docs. 82, 95, 101. While JAB argues that the language included
within the Stipulation (reserving for both parties all rights to
seek relief on all entitlement issues) was sufficient to put
Defendants on notice of their intent to seek appellate attorneys’
fees, Rule 54(d)(2) requires any claim for attorney’s fees to be
made by motion.4 FED. R. CIV. P. 54(d)(2)(A). The Stipulation was
also insufficient to preserve JAB’s right to appellate attorneys’

JAB does not argue that the term “judgment” within Rule 54(d)(2) also applies
to the mandate or opinion of the Fifth Circuit. However, even if it did, the
authority reviewed by this Court persuasively argues that Rule 54(d)(2) only
applies to judgments of the district courts. See Dresser-Rand, 2010 WL 1855959,
at *3-4; L.I. Head Start Child Dev. Servs., Inc. v. Econ. Opportunity Comm’n of
Nassau County, Inc., No. 00-7394, 2013 WL 6388633, at *3 (E.D.N.Y. Dec. 5,
2013).
4 In fact, this Court ordered JAB to file its motion for attorneys’ fees by
June 15, 2015. Rec. Doc. 75. However, JAB never filed any such motion,
instead reaching an agreement on attorneys’ fees memorialized in the
Stipulation.
3

9

fees because it did not include a fair estimate of the amount of
appellate attorneys’ fees that would be sought. See ATEL, 2015 WL
423308, at *3. Accordingly, JAB’s motion must be denied in part
with respect to the request for appellate attorneys’ fees. However,
because the Fifth Circuit explicitly awarded JAB costs on appeal,5
the motion will be granted in that respect.
b. The Motion for Disbursement of Security Bond
Pursuant to Local Rule 67.3, JAB also filed a motion for
disbursement urging this Court to order the Clerk of Court to
distribute $5,467.429.12 plus all legal fees incurred on appeal
from the bond filed with the Court by Defendants as security
pending appeal. Rec. Doc. 100. That amount allegedly represents
the Judgment of $4,864,214.89, prejudgment interest up to June 15,
2015 and the stipulated attorneys’ fees. Rec. Doc. 100-1 at 2.
Defendants opposed the motion on the grounds that disbursement
should not occur until all remaining fee issues are resolved and
that SMS has the capacity to pay the judgment, making disbursement
through the security bond unnecessary and unwarranted. Rec. Doc.
107 at 1. SMS maintains that, once the amount of the award is
finally determined, SMS will comply with an order that it pay the
determined amount to JAB without the need for disbursement of the
security bond. Id. at 107. In reply, JAB claims that SMS has showed

The Fifth Circuit taxed costs at $105. Accordingly, the Court awards that
amount rather than the $233.84 sought by JAB.
5

10

no willingness to pay the undisputed amounts of the Judgment and
thus disbursement should be ordered as it is entitled to pursue
recovery in the manner it deems most efficient. Rec. Doc. 114. at
1-3.
Given SMS’s apparent willingness to pay the judgment now that
all disputed fees issues have been resolved and JAB’s failure to
cite any authority requiring disbursement instead, it is ordered
that SMS have fourteen days from the date of this Order to satisfy
the entirety of the Judgment. If it fails to do so within that
timeframe, JAB may reurge its motion ex parte in compliance with
Local Rule 67.3
III. CONCLUSION
For the reasons outlined above,
IT IS ORDERED that Defendants’ motion to adjust attorneys’
fees is DENIED. Rec. Doc. 102.
IT IS FURTHER ORDERED that JAB’s motion for attorneys’ fees
and costs incurred on appeal is GRANTED in part and DENIED in part.
The motion is granted with respect to the costs taxed by the Fifth
Circuit on appeal.
IT IS FURTHER ORDERED that the motion for disbursement of
security bond is DENIED WITHOUT PREJUDICE to reurge ex parte if
SMS fails to satisfy the Judgment in full within fourteen (14)
days of this Order. Pursuant to the Judgment of this Court and the
mandate of the United States Court of Appeals for the Fifth
11

Circuit, SMS shall pay to JAB $4,864,214.89, plus $439,576.02 as
attorneys’ fees and costs pursuant to the Stipulation, plus $105
as costs taxed on appeal, for a total of $5,303,895.91 plus
prejudgment interest from the date of judicial demand and postjudgment interest in accordance with 28 U.S.C. § 1961(a).
New Orleans, Louisiana, this 13th day of July, 2016.

___________________________________
SENIOR UNITED STATES DISTRICT JUDGE

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