Meecorp Capital Markets, LLC v. PSC of Two Harbors, LLC et al
Filing
120
MEMORANDUM OPINION AND ORDER. 1. Meecorp's request for attorney fees and costs is GRANTED IN PART and DENIED IN PART as follows: Meecorp shall recover attorney fees in the amount of $35,199.87 and costs in the amount of $1,441.(Written Opinion). Signed by Judge Donovan W. Frank on 6/2/2011. (BJS)
UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
Meecorp Capital Markets, LLC,
Civil No. 09-2067 (DWF/LIB)
Plaintiff,
v.
PSC of Two Harbors, LLC; Gandolf Group,
LLC, formerly known as Gandolf Development,
LLC, formerly known as Red Cedar Estates;
Timothy J. Oliver; Christopher M. Anderson;
PSC Funding, LLC; Gandolf Holdings, LLC,
formerly known as Gandolf Group, LLC; Red
Cedar Estates, LLC; Black Hawk Village
Development, LLC; Blue Springs Village
Development, LLC; Brandon Heights Village
Development, LLC; Brandon Heights Village
II Development, LLC; Lakewood Village
Development, LLC, formerly known as
Evergreen Heights Development, LLC;
Gilcrease Hills Estate Development, LLC;
Green Street Estates Development, LLC;
Orleans Terrace Development, LLC;
Pine Crest Village Development, LLC;
Red Cedar Estates Development, LLC;
Red Cedar Estates Development II, LLC;
River Falls Ventures, LLC; South Creek
Village Development, LLC; South Glen
Village Development, LLC; Woodglen
Village Development, LLC, formerly known
as Alta Vista Village Development, LLC;
Black Hawk Village, LP; Blue Springs
Village, LP; Brandon Heights Village, LP;
Brandon Heights Village II, LP; Gilcrease Hills
Estates, LP; Lakewood Village, LP, formerly
known as Evergreen Heights, LP; Mercury
Henderson Cottages, LP; Orleans Terrace, LP;
Pine Crest Village, LP; Red Cedar Estates, LP;
Red Cedar Estates II, LP; South Creek Village, LP;
South Glen Village, LP; Woodglen Village, LP;
MEMORANDUM
OPINION AND ORDER
Neal Fagin; and David Klaristenfeld,
Defendants,
and
Black Hawk Village Development, LLC; Blue Springs
Village Development, LLC; Woodglen Village, LP;
River Falls Ventures, LLC; Orleans Terrace, LP;
Orleans Terrace Development, LLC; South Creek
Village, LP; Red Cedar Estates, LP; Black Hawk
Village, LP; Brandon Heights Village II
Development, LLC; Gilcrease Hills Estates, LP;
Red Cedar Estates Development, LLC; South
Glen Village Development, LLC; Gandolf
Holdings, LLC, formerly known as Gandolf
Group, LLC; Blue Springs Village, LP; Green
Street Estates Development, LLC; Lakewood Village
Development, LLC, formerly known as Evergreen
Heights Development, LLC; Brandon Heights Village,
LP; Pine Crest Village Development, LLC; Pine Crest
Village, LP; Woodglen Village Development, LLC,
formerly known as Alta Vista Village Development,
LLC; Brandon Heights Village II, LP; Gilcrease Hills
Estate Development, LLC; Red Cedar Estates II, LP;
Brandon Heights Village Development, LLC;
Mercury Henderson Cottages, LP; South Creek
Village Development, LLC; Red Cedar Estates
Development II, LLC; South Glen Village, LP;
Lakewood Village, LP, formerly known as
Evergreen Heights, LP; and Gandolf Group, LLC,
formerly known as Gandolf Development, LLC,
formerly known as Red Cedar Estates, LLC,
Third-Party Plaintiffs,
v.
Walter Weil; Myron Bari; Howard Meltzer; Dominick
Tolli; Marion Weil; Meecorp Defined Benefit Plan;
The House of Dave-Profit Sharing Plan; Sharon
Edrei; Stanley Liebowitz; Yoram Mizrahi; Neal Fagin;
Intermedia Profit Sharing Plan; David Lenkowski
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SEP IRA; Alfred Weinberger; Harry Rosner; Anika,
Inc.; Mark Lasser; and David Klaristenfeld,
Third-Party Defendants,
and
Black Hawk Village Development, LLC; Blue Springs
Village Development, LLC; Woodglen Village, LP;
River Falls Ventures, LLC; Orleans Terrace, LP;
Orleans Terrace Development, LLC; South Creek
Village, LP; Black Hawk Village, LP; Red Cedar
Estates, LLC; Brandon Heights Village II
Development, LLC; Gilcrease Hills Estates, LP;
Red Cedar Estates Development, LLC; South Glen
Village Development, LLC; Gandolf Holdings, LLC,
formerly known as Gandolf Group, LLC; Blue Springs
Village, LP; Green Street Estates Development, LLC;
Lakewood Village Development, LLC, formerly known
as Evergreen Heights Development, LLC; Brandon
Heights Village, LP; Pine Crest Village Development,
LLC; Pine Crest Village, LP; Woodglen Village
Development, LLC, formerly known as Alta Vista
Village Development, LLC; Brandon Heights Village
II, LP; Gilcrease Hills Estate Development, LLC;
Red Cedar Estates II, LP; Brandon Heights Village
Development, LLC; Mercury Henderson Cottages, LP;
South Creek Village Development, LLC; Red Cedar
Estates Development II, LLC; South Glen Village, LP;
Lakewood Village, LP, formerly known as Evergreen
Heights, LP; and Gandolf Group, LLC, formerly known
as Gandolf Development, LLC, formerly known as
Red Cedar Estates, LLC,
Counter-Claimants,
v.
Meecorp Capital Markets, LLC,
Counter-Defendant.
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Daniel N. Rosen, Esq., and Douglas G. Wardlow, Esq., Parker Rosen, LLC, counsel for
Plaintiff.
Jarod M. Bona, Esq., and Alan L. Kildow, Esq., DLA Piper LLP, counsel for Intervenor
Plaintiffs.
Richard M. Carlson, Esq., Morris Law Group, PA, and Todd H. Johnson, Esq., Oliver &
Johnson, PA.
INTRODUCTION
This matter is before the Court on a request for attorney fees and costs brought by
Plaintiff Meecorp Capital Markets, LLC (“Meecorp”). (Doc. No. 112.) The Court
previously granted summary judgment in favor of Meecorp on its claim against
Defendant PSC of Two Harbors, LLC (“PSC”) for breach of a promissory note that PSC
executed and delivered to Meecorp in the original principal amount of $1,320,000 (the
“Note”). (Doc. No. 108.) The Court also granted summary judgment in favor of
Meecorp on its claims against Defendants Timothy J. Oliver and Christopher M.
Anderson for breach of a Joint Guaranty related to the Note (the “Joint Guaranty”). (Id.)
The Note and the Joint Guaranty each authorize reimbursement to Meecorp for its
reasonable attorney fees and costs incurred in collecting on the underlying debt.
In its Order granting in part and denying in part Meecorp’s motion for summary
judgment, the Court reserved ruling on Meecorp’s request for attorney fees pending
further submissions by the parties. Here, Meecorp seeks attorney fees in the amount of
$175,999.37 and costs in the amount of $10,437.33. PSC, Oliver, and Anderson (the
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“PSC Defendants”) oppose the request. For the reasons set forth below, the Court grants
the request in part and denies it in part.
BACKGROUND AND DISCUSSION
This matter has an unusually complicated procedural history. The initial
Complaint, filed on August 6, 2009, named four defendants: PSC, Oliver, Anderson, and
Gandolf Group, LLC (“Gandolf”). (Doc. No. 1.) It asserted three counts: breach of the
Note by PSC, breach of the Joint Guaranties by Oliver and Anderson, and breach of a
second guaranty by Gandolf. Meecorp filed an Amended Complaint on
September 11, 2009 and added claims for fraud; claim, delivery, and foreclosure of
security interests; and appointment of a receiver. (Doc. No. 7.) The Amended Complaint
also added thirty-two (32) defendants. The newly-added defendants answered and
included a third-party complaint that added an additional twenty-two (22) parties as
third-party defendants on February 16, 2010. (Doc. No. 26.) On October 19, 2010, four
more parties moved to intervene. (Doc. No. 68.) These four parties were allowed to
intervene and filed a counterclaim against Meecorp on November 11, 2010. (Doc.
No. 80.) Some of these parties have resolved their disputes with Meecorp and others
have successfully moved for dismissal, yet even after summary judgment, several claims
and defenses and more than thirty parties remain in this action.
Meecorp moved for summary judgment on all but its fraud claim. The Court
granted Meecorp’s motion as to the Note and the Joint Guaranty but denied the motion as
to the remaining claims. Because the Note and Joint Guaranty contain provisions for the
award of attorney fees and costs, the Court directed Meecorp to submit an affidavit
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supporting its fee request. The Court’s Order also set forth the time in which any
response from the PSC Defendants must be received.
Meecorp submitted an affidavit seeking reimbursement for all of its attorney fees
and costs incurred in this matter through the summary judgment hearing. The affidavit is
accompanied by ninety-nine (99) pages of invoices. In its submission, Meecorp did not
differentiate between attorney fees and costs related to its claims for breach of the Note
and the Joint Guaranty, for which summary judgment was granted, and the additional
claims which remain in the case. Meecorp seeks fees and costs totaling $186,436.70.
The PSC Defendants respond that the vast majority of the requested fees and costs
are associated with Meecorp’s litigation against Gandolf and the other third-party
plaintiffs. The PSC Defendants assert that reasonable attorney fees and costs for a
collection action seeking to enforce the Note and Joint Guaranty should not exceed
$12,000 plus the costs for depositions of Anderson and Oliver. After reviewing the
parties’ submissions, the Court directed Meecorp to reply to the PSC Defendants’
position. In reply, Meecorp maintains that it is entitled to an award against the PSC
Defendants for all of Meecorp’s attorney fees and costs incurred in this matter through
the summary judgment hearing. The Court disagrees.
In calculating reasonable attorney fees, the Court begins by calculating the
“lodestar”—the product of the number of hours reasonably expended on the litigation and
the reasonable hourly rate at which those hours should be billed. Hensley v. Eckerhart,
461 U.S. 424, 433 (1983). The reasonableness of a fee depends upon a number of
factors, including “the plaintiff’s overall success; the necessity and usefulness of the
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plaintiff’s activity in the particular matter for which fees are requested; and the efficiency
with which the plaintiff’s attorneys conducted that activity.” Jenkins v. Missouri,
127 F.3d 709, 718 (8th Cir. 1997).
“[T]he fee applicant bears the burden of establishing entitlement to an award and
documenting the appropriate hours expended and hourly rates.” Hensley, 461 U.S.
at 437. Where only partial or limited success has been obtained, “the product of hours
reasonably expended on the litigation as a whole times a reasonable hourly rate may be
an excessive amount.” Id. at 436. Under such circumstances, “[t]he district court may
attempt to identify specific hours that should be eliminated, or it may simply reduce the
award to account for the limited success.” Id. at 436-37.
Here, Meecorp obtained limited success in its motion for summary judgment yet
seeks an award of its attorney fees and costs for the entire litigation up to that point. The
PSC Defendants specifically challenged Meecorp’s failure to differentiate between the
claims on which Meecorp prevailed and the claims that remain to be decided at trial. The
Court requested that Meecorp provide a response to the PSC Defendants, and Meecorp
continued to seek its entire fee amount.
The Court concludes that Meecorp’s request seeks an excessive amount. At this
stage of the proceedings, Meecorp is not entitled to its attorney fees and costs incurred for
claims on which it has not prevailed. The Court has reviewed Meecorp’s ninety-nine
(99) page billing record submission. Meecorp has failed to differentiate between hours
expended on the breach of contract claims against the three defendants on which
Meecorp has prevailed and the remaining unresolved claims. The Court therefore
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reduces the attorney fees requested by eighty percent (80%). Meecorp also fails to
differentiate in its requested costs between the various claims. The Court therefore
reduces the award of costs to $1,441 for the costs identified in Meecorp’s
December 30, 2010 billing statement for the depositions of Defendant Oliver and
Defendant Anderson.
CONCLUSION
Based on the files, records, and proceedings herein, and for the reasons set forth
above, IT IS HEREBY ORDERED that:
1.
Meecorp’s request for attorney fees and costs is GRANTED IN PART and
DENIED IN PART as follows: Meecorp shall recover attorney fees in the amount of
$35,199.87 and costs in the amount of $1,441.
Dated: June 2, 2011
s/Donovan W. Frank
DONOVAN W. FRANK
United States District Judge
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