Grand Electric, LLC v. International Brotherhood of Electrical Workers Local 265
Filing
190
MEMORANDUM AND ORDER regarding pending motions: 1. the Dakotas Funds' motion to seal, (ECF No. 175 ), the Electrical Funds' motion to seal, (ECF No. 180 ), and Grand Electric's motion to seal, (ECF No. 184 ), are denied; 2. the Dako tas Funds' motion for attorney's fees, (ECF No. 176 ), is granted in part, and they are entitled to an award of attorney's fees and expenses totaling $27,818.69; 3. the Electrical Funds' motion for attorney's fees, (ECF No. 181 ), is granted in part, and they are entitled to an award of attorney's fees and expenses totaling $21,470.38; and 4. the Judgment will be amended to reflect these awards. Ordered by Senior Judge Warren K. Urbom. (JAB)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
GRAND ELECTRIC, LLC,
)
)
Plaintiff,
)
)
v.
)
)
INTERNATIONAL BROTHERHOOD OF )
ELECTRICAL WORKERS LOCAL 265,
)
NATIONAL ELECTRICAL BENEFIT
)
FUND, DAKOTAS & WESTERN
)
MINNESOTA ELECTRICAL HEALTH & )
WELFARE FUND, INTERNATIONAL
)
BROTHERHOOD OF ELECTRICAL
)
WORKERS 265 VACATION FUND,
)
LINCOLN ELECTRICAL JOINT
)
APPRENTICESHIP & TRAINING TRUST )
FUND, TRUSTEES OF THE NATIONAL )
ELECTRICAL BENEFIT FUND,
)
TRUSTEES OF DAKOTAS & WESTERN )
MINNESOTA ELECTRICAL HEALTH & )
WELFARE FUND, TRUSTEES OF
)
DAKOTAS AREAWIDE IBEW-NECA
)
SAVINGS AND RETIREMENT PLAN,
)
TRUSTEES OF THE INTERNATIONAL
)
BROTHERHOOD OF ELECTRICAL
)
WORKERS 265 VACATION FUND,
)
TRUSTEES OF THE LINCOLN
)
ELECTRICAL JOINT APPRENTICESHIP )
& TRAINING TRUST FUND, and
)
DAKOTAS AREAWIDE IBEW-NECA
)
SAVINGS AND RETIREMENT PLAN,
)
)
Defendants.
)
)
4:09CV3160
MEMORANDUM AND ORDER ON
MOTIONS TO SEAL EXHIBITS AND
DEFENDANTS’ MOTION FOR
ATTORNEY’S FEES AND COSTS
On August 9, 2011, a judgment was entered in favor of Defendants Dakotas and Western
Minnesota Health and Welfare Fund, the Trustees of Dakotas and Western Minnesota Health and
Welfare Fund, Dakotas Areawide IBEW-NECA Savings and Retirement Plan, the Trustees of the
1
Dakotas Areawide IBEW-NECA Savings and Retirement Plan (collectively “the Dakotas Funds”),
IBEW 265 Vacation Fund, the Trustees of the IBEW 265 Vacation Fund, National Electrical Benefit
Fund, the Trustees of the National Electrical Benefit Fund, Lincoln Electrical Joint Apprenticeship
and Training Fund, and the Trustees of the Lincoln Electrical Joint Apprenticeship and Training
Fund (collectively, “the Electrical Funds”) on their counterclaims against Plaintiff Grand Electric.
(ECF No. 174.) Following the entry of judgment, the Dakotas Funds filed a motion for an award of
attorney’s fees and costs, (ECF No. 176), and a motion to seal one of the exhibits submitted in
support of the motion for fees and costs, (ECF No. 175). The Electrical Funds also filed a motion
for attorney’s fees and costs, (ECF No. 181), and a motion to seal an exhibit, (ECF No. 180). Grand
Electric has responded to the Funds’ motions for attorney’s fees and costs, (ECF No. 185), and it has
filed a motion to seal exhibits submitted in support of its response brief, (ECF No. 184). For the
following reasons, I shall deny the parties’ motions to seal exhibits, and I shall grant in part the
Funds’ motions for fees and costs.
I.
BACKGROUND
On July 27, 2009, Grand Electric filed a complaint in this court against the Dakotas Funds,
the Electrical Funds, and the International Brotherhood of Electrical Workers Local Union No. 265
(Local 265), seeking a declaration that “Grand Electric properly and effectively repudiated and
terminated two collective bargaining agreements[,] which terminated any obligation that Grand
Electric had to contribute fringe benefits” to the Funds. (See Compl. ¶ 19, ECF No. 1.)1 In October
2009, Local 265 filed an answer to the complaint and a counterclaim, (ECF No. 40), and the Dakotas
Funds and Electrical Funds filed motions to dismiss the complaint, (see ECF Nos. 36, 39, 46).
The Funds’ motions to dismiss were denied, (ECF No. 59), and on March 15, 2010, the
Dakotas Funds and Electrical Funds filed answers and counterclaims, (see ECF Nos. 60, 61). The
counterclaim filed by the Dakotas Funds alleged that Grand Electric did not submit reports and
1
The complaint also lists the Dakotas Areawide IBEW-NECA Vacation and Holiday
Plan and the Trustees of the Dakotas Areawide IBEW-NECA Vacation and Holiday Plan as
defendants, but Grand Electric dismissed these two defendants from the action on October 27,
2009. (ECF No. 44.)
2
contributions that were required under the terms of the collective bargaining agreement known as
“the Inside Agreement.” (Counterclaim ¶¶ 4, 6-12, Prayer for Relief ¶¶ 1-2, ECF No. 60 (citing,
inter alia, ERISA section 515, 29 U.S.C. § 1145).) The counterclaim filed by the Electrical Fund
alleged that Grand Electric did not submit reports and contributions required under the terms of “the
Inside Agreement” and “the Sound and Communications Agreement.” (Counterclaim ¶¶ 1, 10-17,
ECF No. 61 (citing, inter alia, ERISA section 515, 29 U.S.C. § 1145).) On April 19, 2010, the
Dakotas Funds added a counterclaim alleging that they had a right to audit Grand Electric’s records.
(Counterclaim ¶¶ 18-25, ECF No. 77.)
In April 2010, Grand Electric filed a motion for summary judgment against all of the
defendants, (ECF No. 70), and Local 265 filed a motion for summary judgment on its counterclaim
against Grand Electric (ECF No. 89). On June 30, 2010, I denied Local 265’s motion for summary
judgment. (ECF No. 109.) Local 265 filed a motion for reconsideration of this decision, (ECF No.
110), which was denied, (ECF No. 118). I granted Grand Electric summary judgment “on its claim
that its obligation to continue making benefit contributions pursuant to the [collective bargaining]
Agreements ends on the Agreements’ termination dates,” but I declined to resolve most of the issues
raised in Grand Electric’s motion until the defendants had an adequate opportunity to complete
discovery. (Mem. & Order at 16, ECF No. 109.)
Grand Electric filed an amended complaint on November 24, 2010, adding a claim for
restitution against the Dakotas Funds and Electrical Funds. (ECF No. 134.) It also filed amended
answers to the counterclaims filed by the Dakotas Funds and the Electrical Funds. (ECF Nos. 135136.)
On March 30, 2011, the magistrate judge entered an order stating that Grand Electric’s
motion for summary judgment (which remained pending while the parties worked to complete
discovery) was withdrawn, but that “[a]ll parties intend[ed] to file [new] summary judgment
motions.” (ECF No. 153.) Indeed, on May 4, 2011, all of the parties except Local 265 did file
motions for summary judgment. (ECF Nos. 155, 158.)
I denied Grand Electric’s motion for summary judgment in a memorandum and order dated
July 25, 2011. (ECF No. 169.) I determined that Grand Electric’s repudiation of the collective
bargaining agreements did not violate the National Labor Relations Act, but nevertheless Grand
3
Electric was not entitled to a declaration stating that its obligation to make fringe benefits payments
to the Funds ended on the date of the repudiation. (Mem. & Order at 16-19, ECF No. 169.) In that
same memorandum and order, I concluded that the Funds were entitled to summary judgment on
their claim against Grand Electric for unpaid benefit contributions and on Grand Electric’s restitution
claim. (See id. at 22-26.) I noted, however, that the specific amounts owed to the Funds remained
to be determined. (Id. at 24, 26.)
The parties then filed a joint motion for the entry of judgment based on stipulated facts.
(ECF No. 172.) This motion was granted, (ECF No. 173), and on August 9, 2011, I entered a
judgment stating that the Dakotas Funds and Electrical Funds were entitled to contributions,
liquidated damages, and interest totaling $9,518.53, (ECF No. 174). The judgment also states,
“Requests for costs and attorney’s fees should be made in accordance with all applicable Local Rules
and governing statutes.” (Judgment at 3, ECF No. 174.)
As noted previously, the Dakotas Funds and Electrical Funds have now filed motions for
awards of attorney’s fees and costs, (ECF Nos. 176, 181), and the Dakotas Funds, Electrical Funds,
and Grand Electric have each filed motions to file under seal certain exhibits associated with the
Funds’ fee motions, (ECF Nos. 175, 180, 184). My analysis of these motions follows.
II.
MOTIONS TO SEAL EXHIBITS
The Dakotas Funds have moved to seal Exhibit A to the affidavit of Amanda R. Cefalu, (ECF
Nos. 179-1 & 179-2), which was filed by the Dakotas Funds in support of their motion for attorney’s
fees and costs, (ECF No. 176). (See Dakotas Funds’ Mot. to Seal, ECF No. 175.) The exhibit is a
detailed billing statement, thirty-nine pages in length. (See Cefalu Aff. ¶ 5, ECF No. 179.) The
Dakotas Funds state that an order “sealing or limiting access” to Exhibit A should issue pursuant to
Federal Rule of Civil Procedure 5.2(a) because Exhibit A “includes detailed descriptions of attorney
time, mental impressions and reasons for certain actions taken by counsel and is therefore arguably
protected by the attorney-client and/or work product doctrines.” (Dakotas Funds’ Motion to Seal
at 1, ECF No. 175.) They add that “[i]t is necessary to file this document unredacted to comply with
[Nebraska Civil Rule] 54.4, which requires detailed explanations of attorney time billed.” (Id.)
4
I turn first to the question of whether the exhibit should be sealed pursuant to Federal Rule
of Civil Procedure 5.2(a). That rule states,
Unless the court orders otherwise, in an electronic or paper filing with the
court that contains an individual’s social-security number, taxpayer-identification
number, or birth date, the name of an individual known to be a minor, or a financialaccount number, a party or nonparty making the filing must include only:
(1)
the last four digits of the social-security number and taxpayer-identification
number;
(2)
the year of the individual’s birth;
(3)
the minor’s initials; and
(4)
the last four digits of the financial-account number.
Also, Rule 5.2(b)(5) and (d) indicate that a court may order a filing to be made under seal without
redaction, and thereby excuse the filer from the requirements of Rule 5.2(a).
The Dakotas Funds do not claim that Exhibit A includes any of the information that is subject
to redaction under Rule 5.2(a), and my review of the exhibit has not revealed any unredacted social
security numbers, tax identification numbers, birth dates, names of minors, or financial account
numbers. I also note that Nebraska Civil Rule 54.4, which sets forth guidelines for fee applications
in this court, does not require attorneys to disclose any information covered by Rule 5.2(a). In short,
I am not persuaded that Exhibit A ought to be sealed pursuant to Rule 5.2.
Nor am I persuaded that the exhibit should be sealed pursuant to the attorney-client or work
product privileges. It is the Dakotas Funds’ burden to establish that either of the privileges is
applicable, see, e.g., Rabushka ex rel. United States v. Crane Co., 122 F.3d 559, 565 (8th Cir. 1997);
Hollins v. Powell, 773 F.2d 191, 196 (8th Cir. 1985), and the Dakotas Funds have failed to meet this
burden. There has been no showing that the exhibit–or any portion thereof–contains privileged
material. On the contrary, Ms. Cefalu states in her affidavit that portions of Exhibit A already have
been “redacted to preserve the attorney-client privilege and/or work product doctrine.” (Cefalu Aff.
¶ 5, ECF No. 179.) This statement undermines the Dakotas Funds’ claim that Exhibit A ought to
be sealed to “preserve” privileged information, and it negates their claim that “it was necessary to
file [Exhibit A] unredacted” to comply with this court’s local rules. (Dakota Funds’ Mot. to Seal
at 1, ECF No. 175.)
Moreover, by making a request for attorney’s fees, the Dakotas Funds placed the billing
statement at issue, and thereby waived their claim that Exhibit A is privileged. See, e.g., Ideal
5
Electronic Security Co., Inc. v. International Fidelity Insurance Co., 129 F.3d 143, 151-52 (D.C. Cir.
1997). The Dakotas Funds also waived the privileges by voluntarily disclosing Exhibit A to the
other parties in this case. E.g., Cedar Rapids Lodge & Suites, LLC v. JFS Development, Inc., No.
C 09-0175, 2010 WL 2836789, at *2 (N.D. Iowa July 19, 2010) (citing In re Grand Jury Proceedings,
841 F.2d 230, 234 (8th Cir. 1988)). See also Pittman v. Frazer, 129 F.3d 983, 988 (8th Cir. 1997)
(“[D]isclosure to an adversary waives work product protection as to items actually disclosed.”). In
other words, even if I were to assume that the exhibit contains privileged material, neither the
attorney-client nor the work product privilege may be invoked under the present circumstances. The
Dakotas Funds’ exhibit will not be sealed.
The Electrical Funds have filed a motion to seal their billing statement, which is marked as
Exhibit A to the Declaration of Lauren M. Fletcher, (ECF No. 181-1), for reasons similar to those
cited by the Dakotas Funds. (See Electrical Funds’ Mot. to Seal, ECF No. 180.) Specifically, the
Electrical Funds state that their exhibit is “arguably protected by the attorney client and/or work
product doctrines” because it “includes detailed descriptions of attorney time, mental impressions
and reasons for certain actions taken by counsel,” and they claim that it was “necessary to file this
document unredacted to comply with [Nebraska Civil Rule] 54.4, which requires detailed
explanations of attorney time billed.” (Electrical Funds Mot. to Seal at 1, ECF No. 180.) I find that
the Electrical Funds waived the attorney-client and work product privileges by placing their fees at
issue. Their motion to seal the exhibit will be denied.
Finally, Grand Electric has filed a motion to seal all of the exhibits that it has submitted in
response to the Funds’ motions for attorney’s fees. (ECF No. 184.) Some of these exhibits are
excerpts from the Dakotas Funds and Electrical Funds billing statements. (See Pl.’s Index, Exs. 1,
3, 5, 7, 8, ECF Nos. 186-1, 186-3, 186-5, 186-7, 186-8.) Others are described as “adding machine
tapes.” (See Pl.’s Index, Exs. 2, 4, 6, ECF Nos. 186-2, 186-4, 186-6.) Others include the Dakotas
Funds’ responses to Grand Electric’s interrogatories and requests for production of documents, (Pl.’s
Index, Ex. 9, ECF No. 186-9); the Dakotas Funds’ supplemental responses to Grand Electric’s
interrogatories and requests for production of documents, (Pl.’s Index, Ex. 10, ECF No. 186-10);
Local 265’s responses to Grand Electric’s interrogatories and requests for production of documents,
(Pl.’s Index, Ex. 11, ECF No. 186-11); the Electrical Funds’ responses to Grand Electric’s
6
interrogatories and requests for production of documents, (Pl.’s Index, Ex. 12, ECF No. 186-12); and
the Electrical Funds’ supplemental responses to Grand Electric’s interrogatories and requests for
production of documents, (Pl.’s Index, Ex. 13, ECF No. 186-13). Grand Electric’s last exhibit is an
affidavit signed by Adam J. Prochaska. (Pl.’s Index, Ex. 14, ECF No. 186-14.) Echoing the
Electrical Funds’ motion to seal, Grand Electric argues that all of its exhibits must be sealed because
they “include detailed descriptions of attorney time, mental impressions and reasons for certain
actions taken by counsel and [are] therefore arguably protected by the attorney-client and/or work
product doctrines.” (Pl.’s Mot. to Seal at 1, ECF No. 184.) After carefully reviewing these
documents, I find that Grand Electric has not shown that any of them fall within the protection of
the attorney-client privilege or the work product doctrine; moreover, to the extent that any privilege
might have been applicable, it has been waived. Grand Electric’s motion to seal will be denied.
III.
MOTIONS FOR ATTORNEY’S FEES AND COSTS
The Dakotas Funds have filed a motion for attorney’s fees and costs, (ECF No. 176), and the
Electrical Funds have filed a motion for attorney’s fees (ECF No. 181).2 I have analyzed these
motions, and my findings of fact and conclusions of law are set forth below. See Fed. R. Civ. P.
54(d)(2)(C) (citing Fed. R. Civ. P. 52(a)).
A.
1.
The Dakotas Funds’ Motion for Attorney’s Fees and Costs
An Award of Reasonable Attorney’s Fees and Costs is Mandatory Under ERISA §
502(g)(2)
The Dakotas Funds argue that they are entitled to an award of attorney’s fees and costs under
section 502(g)(2) of ERISA, 29 U.S.C. § 1132(g)(2). Section 502(g)(2) states, “In any action under
this subchapter by a fiduciary for or on behalf of a plan to enforce section 1145 of this title in which
judgment in favor of the plan is awarded, the court shall award the plan . . . reasonable attorney’s
fees and costs of the action, to be paid by the defendant.” 29 U.S.C. § 1132(g)(2)(D) (emphasis
added). The Dakotas Funds have obtained a judgment in their favor on their counterclaim, which
was based on section 515 of ERISA, 29 U.S.C. § 1145. (See ECF Nos. 169, 174.) Therefore,
2
The Electrical Funds filed a separate bill of costs, (ECF No. 187), and those costs have
been taxed against Grand Electric, (ECF No. 189).
7
reasonable attorney’s fees and costs must be awarded to the Dakotas Funds. See Greater Kansas City
Laborers Pension Fund v. Thummel, 738 F.2d 926, 931 (8th Cir. 1984).
Citing International Brotherhood of Electrical Workers, Local No. 22 Plans A & B v. Nanco
Electric Inc., 790 F.2d 59, 62 (8th Cir. 1986), Grand Electric argues that section 502(g)(2) does not
make an award of attorney’s fees mandatory. (See Pl.’s Br. at 6, ECF NO. 185.) It seems to me,
however, that Nanco Electric involved special circumstances that are not present in the instant case.
In Nanco Electric, a union filed an action to enforce the terms of a collective bargaining agreement.
Prior to the filing of the suit, Nanco refused to make contributions to the union’s trust funds. After
the suit was filed, the parties settled an unfair labor practice charge that was pending before the
National Labor Relations Board. Pursuant to the terms of this settlement, Nanco paid the delinquent
amounts to the union’s trust funds. See id. at 60. The union’s suit against Nanco progressed, but
the parties stipulated that Nanco had paid all amounts owed to the trust fund at the expiration of the
collective bargaining agreement, and the union’s attorney told the district court that the union was
not claiming attorney’s fees for those payments. Id. at 60-61, 62. The union later sought to recover
attorney’s fees for the collection of the delinquent contributions, however, arguing that attorney’s
fees are mandatory “in any case to collect delinquent contributions by the employer to an employee
pension plan under a collective bargaining agreement in which judgment in favor of the plan is
awarded.” Id. at 62 (citing, inter alia, 29 U.S.C. § 1132(g)(2)(D)). Noting that the delinquent
contributions had been paid before trial and that “the union’s attorney specifically declined to seek
attorneys’ fees for the collection of these funds,” the Eighth Circuit rejected the union’s claim for
attorney’s fees. Id.
The instant case is clearly distinguishable from Nanco Electric. Grand Electric did not pay
the delinquent contributions prior to the entry of judgment, nor did the defendants’ attorneys
specifically decline to seek attorney’s fees for their collection efforts. In short, the court rejected the
union’s claim for attorney’s fees in Nanco Electric for reasons that are simply not implicated in this
case.
Grand Electric also argues “that there is no presumption in favor of awarding attorney fees
to a prevailing party in an ERISA case,” (Pl.’s Br. at 6-7, ECF No. 185 (citing Local 22 International
Brotherhood of Electrical Workers v. Sadler Electric, Inc., No. 8:05CV523, 2006 WL 3511324, at
8
*1 (D. Neb. Dec. 5, 2006))), adding that I should consider a number of factors before exercising my
discretion to award fees, including “(1) the degree of culpability or bad faith of the opposing party;
(2) the ability of the opposing party to pay attorney fees; (3) whether an award of attorney fees
against the opposing party might have a future deterrent effect under similar circumstances; (4)
whether the parties requesting attorney fees sought to benefit all participants and beneficiaries of a
plan or to resolve a significant legal question regarding ERISA itself; and (5) the relative merits of
the parties’ positions,” (Pl.’s Br. at 7 (quoting Sadler Electric, 2006 WL 3511324, at *1)). Sadler
Electric does hold that district courts should exercise discretion in awarding attorney’s fees under
ERISA. See 2006 WL 3511324, at *1 (citing Starr v. Metro Systems, Inc., 461 F.3d 1036, 1040-41
(8th Cir. 2006); Martin v. Arkansas Blue Cross & Blue Shield, 299 F.3d 966, 972 (8th Cir. 2002)).
However, the cases cited in Sadler Electric involve attorney fee requests made pursuant to section
502(g)(1) of ERISA, 29 U.S.C. § 1132(g)(1), which contains terms that are materially different than
those appearing in section 502(g)(2).3 I am not persuaded that section 502(g)(2) leaves me the
discretion to deny the defendants reasonable attorney’s fees and costs. Moreover, the factors
outlined in Sadler Electric are simply not relevant when a party claims attorney’s fees under this
section. See Greater Kansas City Laborers Pension Fund v. Thummel, 738 F.2d 926, 931 (8th Cir.
1984).
Finally, Grand Electric argues that the Funds’ fee requests require “extremely critical”
reviews because “Nebraska law generally disfavors attorney fee awards.” (Pl.’s Br. at 36, ECF No.
185.) While it is true that a federal court “may take direction from the law of the state in which it
sits” when ERISA fails to address a particular issue, Regents of the University of Michigan v.
Employees of Agency Rent-A-Car Hospital Association, 122 F.3d 336, 339 (6th Cir. 1997), ERISA
clearly addresses the issue of attorney’s fees. In short, I shall not consider Nebraska law when
analyzing the defendants’ fee requests, and I am not persuaded that section 502(g)(2) fee awards are
disfavored.
3
Unlike section 502(g)(2), which states that the court “shall award” attorney’s fees,
section 502(g)(1) states that “the court in its discretion may allow a reasonable attorney’s fee and
costs of action to either party.” 29 U.S.C. § 1132(g)(1).
9
The amount of the attorney’s fees award remains to be determined. Though a reasonable fee
award is mandatory, the amount of the fee is a matter that falls within the court’s discretion. E.g.,
Thummel, 738 F.3d at 931. A useful starting point for determining the amount of a reasonable fee
is the “lodestar,” which is calculated by multiplying the number of hours reasonably expended on
the litigation by a reasonable hourly rate. See, e.g., Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)
(discussing attorney’s fees awarded under the Civil Rights Attorney’s Fees Awards Act, 42 U.S.C.
§ 1988); Bd. of Trustees of the Hotel & Restaurant Employees Local 25 v. JPR, Inc., 136 F.3d 794,
801 (D.C. Cir. 1998) (applying the lodestar method to calculate reasonable attorney’s fees under 29
U.S.C. § 1132(g)(2)). In this case, the Dakotas Funds seek a total of $36,268.25 in attorney’s fees,
(see Dakotas Funds’ Mot. at 2, ECF No. 176), which “reflect over 178 hours of work performed at
an average hourly rate of approximately $215.00,” (Dakotas Funds’ Br. at 5, ECF No. 177). Grand
Electric does not claim that the hourly rate submitted by the Dakotas Funds is unreasonable. (Pl.’s
Br. at 16, ECF No. 185.) It does argue, however, that the number of hours is excessive and that the
billing records submitted by the Dakotas Funds are deficient. (See generally id.) I shall consider
each of Grand Electric’s arguments in turn and note whether they merit a reduction in the number
of hours claimed by the Dakotas Funds.
2.
Whether the Fee Should Be Reduced Because Some of the Contributions Recovered by the
Funds Were Not Delinquent at the Time of the Filing of the Counterclaims
Grand Electric argues that the defendants should not be allowed to recover attorney’s fees
and costs associated with the collection of contributions that did not become delinquent until after
the defendants filed their counterclaims. (See Pl.’s Br. at 4, ECF No. 185.) In support of its
argument, Grand Electric cites Carpenters & Joiners Welfare Fund v. Gittleman Corp., 857 F.2d 476,
478 (8th Cir. 1988), wherein the Eighth Circuit held that the term “unpaid contributions” in section
502(g)(2) means contributions that were unpaid at the time of the filing of the collection suit.
Grand Electric’s argument is unpersuasive. In Gittleman Corp., the Eighth Circuit found that
liquidated damages based on delinquent contributions were not available when the delinquent
contributions were paid before the suit was filed. See 857 F.2d at 478 (“[S]ince there are no ‘unpaid
contributions,’ the funds are not entitled to liquidated damages under section 1132(g)(2) because the
availability of those damages is keyed to the existence of ‘unpaid contributions.’”). Here, in contrast,
10
Grand Electric did not pay delinquent contributions before the suit was filed, and the issue of the
moment is not liquidated damages, but attorney’s fees. It is noteworthy that unlike section
502(g)(2)(C), section 502(g)(2)(D) does not link requests for attorney’s fees and costs to the amount
of “unpaid contributions”; rather, it states that a plan must be awarded “reasonable attorney’s fees
and costs of the action.” In summary, Gittleman Corp. is inapposite, and I shall not reduce the
Dakotas Funds’ fee request on the ground that not all of the delinquent contributions recovered by
the defendants were “unpaid” at the time of the filing of their counterclaim.4
3.
Whether Fees and Costs Incurred Prior to March 15, 2010, Must Be Deducted from the
Award
Grand Electric argues that because the Dakotas Funds can only recover attorney’s fees and
costs associated with their action to collect delinquent contributions, they cannot recover fees and
costs incurred prior to March 15, 2010. (Pl.’s Br. at 5-6.) This argument is persuasive. Section
502(g)(2) authorizes awards of fees in actions to enforce ERISA section 515; it does not allow the
defendants to recover attorney’s fees for services that have no connection with the collection of
delinquent contributions. I have reviewed Exhibit A to the Affidavit of Amanda R. Cefalu, which
lists the legal services provided to the Dakotas Funds in this case, and I see that it includes several
entries that predate–and, on their face, bear no relation to–the Dakotas Funds’ counterclaim for
delinquent contributions. See Cefalu Aff. ¶ 5, ECF No. 179; Cefalu Aff. Ex. A at 1-7, ECF No. 1791. Indeed, before filing their counterclaims, the defendants argued that its section 515 claims against
Grand Electric were, at best, merely a theoretical possibility. (See, e.g., Dakotas Funds’ Supp. Br.
at 2-5, ECF No. 56; Electrical Funds’ Supp. Br. at 1-2, ECF No. 57.) Because there is no indication
that any of the entries that predate March 15, 2010, relate to the Dakotas Funds’ action to collect
delinquent contributions, the hours listed in these entries will be deducted from the Dakotas Funds’
claim. More specifically, 29.75 hours will be deducted from the 178 hours claimed by the Dakotas
Funds, which reduces the number of hours reasonably expended on the collection action to 148.25.
4
The question of whether the fee award must be proportional to the amount of
contributions recovered will be addressed below.
11
4.
Whether Fees and Costs Incurred in the Defense of Grand Electric’s Declaratory Judgment
Action Must Be Deducted from the Award
Relatedly, Grand Electric argues that even after the Dakotas Funds filed their counterclaim
on March 15, 2010, much of the litigation continued to focus upon Grand Electric’s declaratory
judgment claim, and the Dakotas Funds should not be allowed to recover the attorney’s fees and
costs that they incurred in resisting this claim. (Pl.’s Br. at 9-11, ECF No. 185.) Grand Electric
adds,
Defendant Funds have the burden of proving their entitlement to attorneys’
fees and costs and the Defendant Funds have failed to present the Court with detailed
itemizations of their time and costs. Defendant Funds have not itemized what fees
and costs were attributable to the delinquent contribution action and what fees and
costs were attributable to the one-man unit declaration. This failure prevents Grand
Electric from splitting out the reimbursable portions. Defendants’ motion should,
therefore, be overruled in its entirety because Grand Electric should not be required
to pay any attorneys’ fees or costs related to tasks (or potions of tasks) that do not
explicitly fall within the statute.
In the alternative, if the Court declines to overrule Defendant Funds’ Motions
in their entirety, Grand Electric respectfully requests that, after all other adjustments
are made as described herein[,] the final numbers for each of the Defendant Funds
should be reduced by no less than 50%.
(Id. at 11.)
I agree with Grand Electric that the Dakotas Funds are entitled only to “that portion of [their]
attorney’s fees attributable to [their] successful counterclaim” to recover delinquent contributions.
Penn Elastic Co. v. United Retail & Wholesale Employees Union, Local 115 Joint Pension Fund,
792 F.2d 45, 48 (3d Cir. 1986). See also Brick Masons Pension Trust v. Industrial Fence & Supply,
Inc., 839 F.2d 1323 (9th Cir. 1988) (holding that trust funds could recover reasonable attorney’s fees
on appeal attributable to the issue on which they prevailed); United Automobile Workers Local 529
Security Dept. v. Metro Auto Center, No. 03-2123, 2005 WL 5909017, at *1-2 (D.N.J. Oct. 20,
2005). It would not be reasonable to allow the Dakotas Funds to recover attorney’s fees and costs
that have no connection with their counterclaim.
It seems to me, however, that Grand Electric’s argument depends on whether its declaratory
judgment action is “separate from the Defendant Funds’ claims for unpaid contributions.” (Pl.’s Br.
at 10, ECF No. 185.) A close examination of the issues litigated in this case dispels that notion.
12
Grand Electric sought a declaration that it “properly and effectively repudiated and terminated two
collective bargaining agreements which terminated any obligation that Grand Electric had to
contribute fringe benefits to Defendant Funds or Fund Trustees.” (Compl. ¶ 19, ECF No. 1. See also
Am. Compl. ¶ 19, ECF No. 134.) In other words, Grand Electric attempted to obtain a declaratory
judgment that would free it from making benefits contributions under the terms of the collective
bargaining agreements and prevent the Funds from recovering those unpaid contributions. Indeed,
Grand Electric successfully argued that its claim against the Defendant Funds fell within this court’s
subject matter jurisdiction because the declaratory judgment “would resolve an issue of federal law
between the parties and would preclude the defendants from asserting a right to recover contributions
under ERISA.” (Second Mem. & Order on Defs.’ Mots. to Dismiss at 5, ECF No. 59 (emphasis
added). See also, e.g., Pl.’s Supp. Reply Br. at 4, ECF No. 58.) Grand Electric now argues that its
declaratory judgment action had no connection with the Defendant Funds’ counterclaims to recover
delinquent contributions. I am not persuaded. Grand Electric’s claim and the Defendant Funds’
counterclaims address the same issue (i.e., liability for delinquent contributions) from different sides,
and I cannot say that the hours expended by the Funds in defense of Grand Electric’s declaratory
judgment action were not reasonably expended in an effort to enforce ERISA section 515.
I found above that the hours expended by the Defendant Funds prior to the filing of their
counterclaims bear no relation to the enforcement of ERISA section 515, and therefore those hours
must be deducted from the fee award. At first blush, that finding might appear to be in tension with
my finding that Grand Electric’s declaratory judgment action was not separate and distinct from the
section 515 counterclaims. It merits emphasis, however, that at the time of the filing of Grand
Electric’s complaint, Grand Electric had not yet failed to make contributions, (see, e.g., Dakotas
Funds Counterclaim ¶ 10), and the defendants believed that their section 515 claims were unripe,
(see Dakotas Funds’ Supp. Br. at 2-5, ECF No. 56; Electrical Funds’ Supp. Br. at 1-2, ECF No. 57).
In summary, I find that the hours expended by the Funds’ attorneys prior to the filing of the
counterclaims were not related to the enforcement of ERISA section 515. After the counterclaims
were filed, however, the Funds opposed Grand Electric’s claims on their merits, and at this point all
of their efforts were reasonably related to the enforcement of section 515. I shall not reduce the
13
Funds’ fee requests on the ground that Grand Electric’s claims were entirely separate from the
Funds’ collection actions.5
5.
Whether “Double-Billed” Attorney Conferences Must Be Deducted from the Award
Grand Electric argues that I should exclude excessive, duplicative, and unnecessary hours
from the Dakotas Funds’ fee request. (Pl.’s Br. at 16, 18-19, ECF No. 185.) Specifically, it argues
that when two of the Dakotas Funds’ attorneys conference with one another, those conferences
should not be “double-billed” in the names of both attorneys. Rather, the “smaller duplicative time
entry” should be deleted from the fee request. I find, however, that it is reasonable to expect some
amount of billing for conferences between attorneys, and here the amount billed for such conferences
is relatively small. Indeed, Grand Electric argues that only one hour of “attorney conference” time
should be stricken from the request. (See Pl.’s Br. at 18-19, ECF No. 185. See also Pl.’s Ex. 7 at
1-2, ECF No. 186-7.) Moreover, the “duplicative” entries highlighted by Grand Electric have
already been stricken from the request on the ground that they predate the filing of the Dakotas
Funds’ section 515 claim. The fee request will not be reduced further on the ground that it includes
duplicative entries.
6.
Whether Certain Billing Entries Fail to Comply with This Court’s Fee Application
Guidelines
Grand Electric argues that many of the entries appearing in the Dakotas Funds’ billing
records must be stricken because they do not comply with Nebraska Civil Rule 54.4. (Pl.’s Br. at
19-28, ECF No. 185.) More specifically, it claims that 2.75 hours should be deducted because
“attorneys conferences” are not documented adequately; 14.25 hours should be deducted because
“legal research” is not documented adequately; and 39.75 hours should be deducted because the
people who performed certain work are not identified. (See Pl.’s Br. at 23, 25-26, ECF No. 185.)
5
For the same reasons, I shall not reduce the Funds’ fee requests on the ground that it was
unnecessary for them to review Grand Electric’s work records predating July 2009. (See Pl.’s
Br. at 28-31, ECF No. 185.) This records review was a necessary component of the Funds’
opposition to Grand Electric’s “one man unit” theory–and this theory formed the basis of Grand
Electric’s claim that it no longer had any obligation to contribute to the Funds. (See, e.g., Mem.
& Order on Cross Mots. for Summ. J. at 5-9, 12-16, ECF No. 169.)
14
Grand Electric also claims that deposition expenses must be stricken from the award due to their
inadequate documentation. (See id. at 27-28.) I shall consider each of these points in turn.
Nebraska Civil Rule 54.4(a)(1)(A) states that attorneys seeking fees “[f]or a conference”
should “state who was present, the subjects discussed, and how long it lasted.” Grand Electric
highlights five separate entries in the Dakota Funds’ billing records that allegedly fail to comply with
this rule. (See Pl.’s Index, Ex. 7 at 1-2, 14, ECF No. 186-7.) All but one of these entries have
already been stricken from the request on the ground that they bear no relation to the Dakotas Funds’
section 515 action. The remaining entry states that 0.5 hours were billed for “Conference with
Assistant Smith regarding review of file and outline to draft of what documents have not produced
to date [sic];” and “telephone conference with Attorney Fletcher . . . regarding discovery and
potential motion to compel discovery.” (Id. at 14.) I find that the entry states “who was present” and
“the subjects discussed” with sufficient detail. Although the entry does not indicate precisely how
long each individual conference lasted, it does state that the two conferences lasted a total of 0.5
hours. I find that the conferences are documented adequately, and the time spent on them was
reasonable. The entry will not be stricken.
The local rules state that attorneys seeking fees for legal research should “state who did it,
the subjects and issues researched, and whether the results were incorporated into a brief, motion,
or pleading.” NECivR 54.4(a)(1)(B). Grand Electric has marked seven entries in the Dakota Funds’
billing records that allegedly fail to comply with this rule. (See Pl.’s Index, Ex. 7 at 2, 10-13, 22-23,
ECF No. 186-7.) The entry that appears on page two of the records has already been stricken from
the request, and the remaining entries state that a total of 15.75 hours were spent on research.6 I have
carefully studied these entries, and I note that many of them do not state specifically “the subjects
6
As noted previously, Grand Electric argues that 14.25 hours dedicated to legal research
should be stricken from the fee request. (See Pl.’s Br. at 25, ECF No. 185.) It is difficult to
account for the discrepancy between Grand Electric’s and my calculations. Grand Electric states
that the entries it seeks to strike are marked in purple on Exhibit 7. (See id.) I find only two
entries marked in purple, however, and these entries account for a total of only 8 hours. (See
Pl.’s Index, Ex. 7 at 11-12, ECF No. 186-7.) A number of other entries for “research” are
marked in orange; including these entries in the calculation raises the total to 15.75 hours (after
the entry appearing on page two, which has already been stricken, is excluded). (See id. at 10,
13, 22-23.)
15
and issues researched.” (See, e.g., id. at 10-13.) They do state, however, that the research was
performed in order to complete specific memoranda that were filed in this case, (see id.), which
allows me to determine whether the research hours were reasonably expended.
After due
consideration, I find that the billing records provide adequate documentation for the fees requested
by the Dakotas Funds, and I find that the number of research hours listed in the highlighted entries
is reasonable. These hours will not be stricken from the fee award.
Nebraska Civil Rule 54.4(a)(2) states that attorneys seeking a fee award should “[i]dentify
the status and background (attorney, paralegal, law student) of each person performing an item of
work.” Grand Electric argues that 16 entries fail to comply with this rule. (See Pl.’s Index, Ex. 7
at 2, 9-13, 15-16, 22-23, ECF No. 186-7.) The entry that appears on page two of Grand Electric’s
exhibit has been stricken from the fee request. The remaining entries state that 39 hours have been
billed for various tasks performed by individuals identified only as “LAF,” “NWK,” “HCS,” and
“EMM.” (See id. at 9-13, 15-16, 22-23. See also Cefalu Aff., ECF No. 179 (identifying three
attorneys who worked on this case, but failing to identify anyone with the initials LAF, NWK, HCS,
or EMM).) The Dakotas Funds’ failure to “identify the status and background” of these people
prevents me from determining whether the hours claimed in their entries are reasonable. I shall
therefore strike these entries from the fee request and reduce the hours claimed by the Dakotas Funds
from 148.25 to 109.25.
7.
Whether the Fee Award Must Be Proportional to the Damages Recovered by the Funds
Grand Electric argues that the Dakotas Funds’ are entitled to recover only “reasonable”
attorney’s fees, and it submits that it is not reasonable for them to “request a total of $41,001.25 in
attorneys’ fees and expenses to obtain a stipulated judgment of $7,875.59.” (Pl.’s Br. at 15, ECF No.
185.) I take Grand Electric’s argument to be that the attorney’s fees award must be proportional to
the damages obtained by the Dakotas Funds.
It appears that the Eighth Circuit has not yet addressed the issue of whether it is appropriate
to reduce a section 502(g)(2) attorney’s fees award on the ground that the fees requested are
disproportionately greater than the amount of the recovered contributions. The courts that have
considered this issue have reached different conclusions. See United Automobile Workers Local
259 Social Security Dept. v. Metro Auto Center, 501 F.3d 283, 295 (3d Cir. 2007) (holding that
16
“requiring proportionality would neglect the language of ERISA and frustrate its purpose”); Building
Service Local 47 Cleaning Contractors Pension Plan v. Grandview Raceway, 46 F.3d 1392, (6th Cir.
1995) (holding that attorney’s fee award must be reasonable, but there is no requirement that it be
proportional to the amount of the underlying award of damages); Moriarty v. Svec, 233 F.3d 955,
967-68 (7th Cir. 2000) (remanding fee order with instructions to consider “proportionality factors”
because attorney’s fee award was a “large multiple[]” of the damages recovered). After careful
consideration, I shall not make an adjustment to the Dakotas Funds’ fee award in the interests of
proportionality.
First, I agree with the Sixth Circuit’s observation that “[n]othing in the text of 29 U.S.C. §
1132(g)(2)(D) suggests that to be ‘reasonable,’ fees must be proportional.” Metro Auto Center, 501
F.3d at 293. I also agree with the court that a proportionality rule would undermine the purpose of
section 502(g)(2). As the Sixth Circuit explained,
When delinquencies are small, the cost of recovery may be disproportionate, and
requiring proportionality would, in effect, discourage plans from taking their claims
to federal courts. Moreover, § 1132(g)(2) was enacted to encourage employers to
make timely contributions, assist plans in their recovery of delinquent contributions,
and discourage excessive litigation by defendants. Funds are burdened by employers
who needlessly extend or complicate litigation for small delinquencies just as they
are burdened by employers who needlessly extend or complicate litigation for larger
delinquencies. We do not read § 1132(g)(2) to limit the fee award of a plan suffering
the former situation merely because the amount of underlying recovery is less.
Id. at 295.
Moreover, even if it is permissible to make a proportionality adjustment
in some
circumstances, the instant fee request does not present a compelling case for such an adjustment.
I have reduced the Dakotas Funds’ attorney’s fees award from $36,268.25 (approximately 178 hours
of work at $215 per hour) to $23,488.75 (109.25 hours of work at $215 per hour). The Dakotas
Funds obtained a judgment in the amount of $7,875.59, including contributions, liquidated damages,
and interest. (See Judgment at 2, ECF No. 174.) Thus, the fee award exceeds the damages award
by a factor of three. After considering the complexity of this case and the purposes of section
17
502(g)(2), I find that a fee award of $23,488.75 need not be adjusted downward in the interests of
proportionality.7
In summary, I find that the Dakotas Funds are entitled to an award of attorney’s fees in the
amount of $23,488.75, based on 109.25 hours of work performed at an average hourly rate of $215
per hour. This fee is reasonable under the totality of the circumstances, including the shortcomings
in the Dakotas Funds’ billing records.
8.
Whether the Costs Requested by the Dakotas Funds May Be Included in the Award
In addition to attorney’s fees, the Dakotas Funds seek to recover $4,734.00 in costs. (See,
e.g., Dakotas Funds’ Mot. at 1, ECF No. 176.) In opposition to this request, Grand Electric argues
that many of the costs claimed by the Dakotas Funds are unrecoverable because they are not
“permitted by 28 U.S.C. § 1920.” (Pl.’s Br. at 31, ECF No. 185. See also id. at 31-32 (quoting Stark
v. PPM America, Inc., No. 01 C 1494, 2003 WL 21223268 (N.D. Ill. May 23, 2003)).) I agree with
Grand Electric that the taxation of costs is governed by 28 U.S.C. § 1920, which allows only the
following costs to be taxed:
(1) Fees of the clerk and marshal;
(2) Fees for printed or electronically recorded transcripts necessarily obtained for use
in the case;
(3) Fees and disbursements for printing and witnesses;
(4) Fees for exemplification and the costs of making copies of any materials where
the copies are necessarily obtained for use in the case;
(5) Docket fees under section 1923 of this title;
(6) Compensation of court appointed experts, compensation of interpreters, and
salaries, fees, expenses, and costs of special interpretation services under section
1828 of this title.
I also agree with Grand Electric that many of the “costs” sought by the Dakotas Funds are
nontaxable–that is, they are not listed in § 1920. (See Dakotas Funds’ Index, Ex. C, ECF No. 179-4.)
7
It merits mention that in Moriarty, the Seventh Circuit did not hold that the fees awarded
by the district court were so disproportionate as to constitute an abuse of discretion; rather, the
court held “only that the district court should consider such proportionality factors in exercising
its discretion in fashioning a reasonable attorney’s fee.” 233 F.3d at 968. I have considered the
possibility that a proportionality adjustment might be necessary–even though well-reasoned
opinions hold that such adjustments are not appropriate–and I find that no further adjustment
ought to be made.
18
Nevertheless, I find that–with some exceptions that will be discussed below–the nontaxable costs
sought by the Dakotas Funds “constitute reasonable out-of-pocket expenses of the kind normally
charged to clients by attorneys” that “are part of the reasonable attorney’s fees to be awarded to
[them].” Nelson v. Metropolitan Life Insurance Co., Civil No. 07-2326 ADM/JSM, 2010 WL
153040, at *13 (D. Minn. Jan. 11, 2010) (citing, inter alia, Pinkham v. Camex, Inc., 84 F.3d 292,
294-95 (8th Cir. 1996); Emmenegger v. Bull Moose Tube Co., 33 F. Supp. 2d 1127, 1133 (E.D. Mo.
1998)).8 In other words, the Dakotas Funds erred by categorizing many of their expenses as “costs,”
but this does not mean that they cannot be included in the attorney’s fee award.
I do find, however, that certain expenses claimed by the Dakotas Funds are unrecoverable.
First, I shall exclude from the award expenses that predate the filing of the Dakotas Funds’
counterclaim on March 15, 2010, on the ground that these expenses were not incurred in connection
with an action to enforce ERISA section 515. By my calculations, this results in a deduction of
$71.57. (See Dakotas Funds’ Index, Ex. C at 1-2, ECF No. 179-4.) I shall also exclude expenses
associated with computer-assisted legal research. See Standley v. Chilhowee R.-IV School Dist.,
5 F.3d 319, 325 (8th Cir. 1993) (holding that expenses for computer-assisted legal research cannot
be added to a fee award). The award will therefore be reduced by an additional $226.44.
Grand Electric argues that certain deposition expenses must be stricken from the award
because the Dakotas Funds have failed to document those expenses adequately. (See Pl.’s Br. at 2728, ECF No. 185.) In support of its argument, Grand Electric cites Nebraska Civil Rule 54.4(b)(2),
which states that parties seeking deposition expenses should “list the court reporter’s name, the date
of the taking, the deponent’s identity, the purpose of the deposition (discovery or evidentiary), and
the use made of the deposition.” It then refers me to two entries in the Dakotas Funds’ billing
records that, according to Grand Electric, do not comply with this rule. The first of these two entries
states that the Dakotas Funds were billed $626.30 for transcripts of the depositions of Andrew and
Tammy Ingwerson. (See Cefalu Aff. Ex. G, ECF No. 179-8.) The documents submitted by the
8
I note in passing that the Dakotas Funds have shown that their attorneys have, in fact,
billed them for a total of $4,734.00 in costs. (See Hannestad Aff. ¶ 4, ECF No. 178.) I find that,
save for the exceptions noted below, the expenses sought by the Dakotas Funds are of the sort
that are “normally charged to clients by attorneys,” and are therefore recoverable as part of the
fee award. Nelson, 2010 WL 153040, at *13.
19
Dakotas Funds state the court reporter’s name, the date of the depositions, and the names of the
deponents. (See id.; see also Cefalu Aff. ¶ 8(viii), ECF No. 179.) They do not indicate, however,
whether the depositions were taken for discovery or evidentiary purposes, nor do they describe the
use that was made of the depositions. Despite these shortcomings, I find that the documentation is
adequate, and the expenses associated with the Ingwersons’ depositions are reasonable. This entry
will not be stricken from the fee award.
The second entry highlighted by Grand Electric states that on December 6, 2010, the Dakotas
Funds’ attorneys issued a $106.05 check to Lehman Reporting Services for a deposition. (See Cefalu
Aff. Ex. C at 9, ECF No. 179-4.) The records do not state court reporter’s name, the date of the
deposition, the name of the deponent, the purpose of the deposition, or the use made of the
deposition. The record does not allow me to determine whether the expense associated with this
deposition is reasonable; therefore, I shall strike $106.05 from the award.
Based on the foregoing findings, the expenses sought by the Dakotas Funds will be reduced
from $4,734.00 to $4,329.94.
9.
Whether the Award Should Be Reduced Because Grand Electric Lacks the Ability to Pay
Finally, Grand Electric argues that it is “unable to satisfy any award of the magnitude that
Defendant Funds’ . . . request,” and that its “current financial situation constitutes a special
circumstance which makes a full award unjust.” (Pl.’s Br. at 36, ECF No. 185.) It adds that “a
bankruptcy would be necessary if [Grand Electric] was required to pay for all of Defendant Funds’
attorneys’ fees.” (Id. at 37.)
A party’s ability to pay a fee award is among the factors used to determine whether a court
should exercise its discretion to award a fee. In this case, however, a fee award is mandatory, and
the Eighth Circuit has held that factors such as “ability to pay” have no bearing on whether the
amount of the award is reasonable. Greater Kansas City Laborers Pension Fund v. Thummel, 738
F.2d 926, 931 (8th Cir. 1984). See also id. (citing Seymour v. Hull & Moreland Engineering, 605
F.2d 1105, 1117 (9th Cir. 1979); Kemmis v. McGoldrick, 706 F.2d 993, 998 (9th Cir. 1983) (listing
factors that may be considered when deciding the amount of a reasonable fee in an ERISA case)).
The award will not be reduced further based on Grand Electric’s “current financial situation.”
20
In conclusion, I find that the Dakotas Funds are entitled to recover attorney’s fees in the
amount of $23,488.75, plus expenses in the amount of $4,329.94, for a total award of $27,818.69.
The Dakotas Funds ask that I amend the judgment so that it incorporates the fee award. (See
Dakotas Funds’ Mot. at 2, ECF No. 176.) They also ask that I allocate 53% of the award to the
Dakotas and Western Minnesota Electrical Industry Workers Health and Welfare Fund (and its
Trustees), and 47% of the award to the Dakotas Areawide Savings & Retirement Plan (and its
Trustees). (See Dakotas Funds’ Br. at 6, ECF No. 177.) This will be done. The judgment will be
amended to state that the Dakotas and Western Minnesota Electrical Industry Workers Health and
Welfare Fund, and its Trustees, are awarded $14,743.91 in attorney’s fees and expenses, and the
Dakotas Areawide Savings & Retirement Plan, and its Trustees, are awarded $13,074.78 in
attorney’s fees and expenses.
B.
The Electrical Funds’ Motion for Attorney’s Fees
The Electrical Funds seek $40,637.05 in attorney’s fees, plus $825.35 in expenses, for a total
award of $41,462.40. (See Electrical Funds’ Mot. ¶¶ 5-6, ECF No. 181.) In opposition to the
Electrical Funds’ request, Grand Electric repeats many of the arguments that it submitted in
opposition to the Dakotas Funds’ request. (See generally Pl.’s Br. at 2-37, ECF No. 185.) For the
reasons explained above in Part III.A., I must reject Grand Electric’s arguments that ERISA section
502(g)(2) does not make an award mandatory; that the award must be reduced because certain
contributions were not delinquent at the time of the filing of the Funds’ counterclaims; that fees and
expenses associated with the Electrical Funds’ defense of Grand Electric’s declaratory judgment
action must be deducted from the award; and that the award must be reduced because Grand Electric
lacks the ability to pay the full amount requested by the Electrical Funds. On the other hand, I agree
with Grand Electric that the Electrical Funds cannot recover fees and expenses that were incurred
prior to the filing of their counterclaim on March 15, 2010. (See supra Part III.A.3.) For this reason,
I shall deduct at total of $4,254.89 in attorney’s fees from the Electrical Funds’ award. (See Pl.’s
Index, Ex. 1 at 1-5, ECF No. 186-1; Pl.’s Index, Ex. 3 at 1-5, ECF No. 186-3; Pl.’s Index, Ex. 5 at
1-5, ECF No. 186-5.)
Grand Electric makes a number of additional arguments in favor of reducing the Electrical
Funds’ award. I shall consider each of these arguments in turn.
21
1.
Whether Fees Incurred by Local 265 Must Be Stricken from the Award
The Electrical Funds’ attorneys also represented Local 265, and legal work that was
performed on behalf of Local 265 has been included in the Electrical Funds’ motion for attorney’s
fees. (See, e.g., Electrical Funds’ Mot., Fletcher Decl. Ex. A at page 11 of 71, ECF No. 181-1
(indicating that the Electrical Funds’ attorneys billed the IBEW 265 Vacation Fund for hours spent
preparing a motion for summary judgment that was filed on behalf of Local 265). See also Pl.’s Br.
at 12-15, ECF No. 185.) I agree with Grand Electric that the fees and expenses incurred by Local
265 cannot be included in the Electrical Funds’ award. I also agree with Grand Electric that the
Electrical Funds’ billing records make it difficult to determine with precision the amount of the fees
and expenses that were incurred by Local 265. Therefore, I shall strike all entries from the fee
request that include some work associated with the representation of Local 265.9 Accounting for
entries that have already been stricken, this results in an additional $10,780.58 deduction from the
Electrical Funds’ award.
Grand Electric also argues that because “all of the work completed by [the Electrical Funds’
attorneys] was at least partially completed for . . . Local 265,” I should either deny the Electrical
Funds’ fee motion “in its entirety” or reduce the award “by no less than an additional 25%.” (Pl.’s
Br. at 14-15, ECF No. 185.) Even if some of the work performed for the Electrical Funds benefitted
Local 265, however, it does not follow that the work was unrelated to the enforcement of ERISA
section 515. Also, I have already reduced the fee award by approximately 25% because the billing
records include work performed for Local 265, and I am not persuaded that a further reduction is in
order.
2.
Whether “Double-Billed” Work Must Be Deducted from the Award
Grand Electric argues that the Electrical Funds should not be allowed to recover fees for
“excessive, duplicative, and unnecessary” attorney conferences, intra-office memoranda, and other
work that involved the efforts of more than one attorney. (Pl.’s Br. at 17-18, ECF No. 185.) Setting
aside the billing entries that have already been stricken, it submits that $2,754.16 in duplicative fees
must be excluded from the award. (See Pl.’s Index, Exs. 1, 3, 5, ECF Nos. 186-1, 186-3, 186-5.)
9
These entries are highlighted in Plaintiff’s Exhibits 1, 3, and 5. (See also Pl.’s Br. at 13,
ECF No. 185.)
22
This represents approximately 18 hours of attorney time, assuming that the time was billed at an
average rate of $155 per hour.10
As I noted above, it is reasonable to expect a certain amount of billing for conferences
between attorneys. (See supra Part III.A.5.) It is also reasonable to expect attorneys to collaborate
on certain tasks. In this case, however, I agree with Grand Electric that the amount of duplicative
billing is excessive. Moreover, in many instances the records submitted by the Electrical Funds do
not provide sufficient information to allow me to determine whether the attorneys are, in fact,
double-billing their clients for conferences. (See infra Part III.B.3.) Due to the billing records’
shortcomings, I shall strike the entire amount that, by my calculations, has been double-billed (and
has not already been stricken from the award). The award will be reduced by $2,754.16.
3.
Whether Certain Billing Entries Fail to Comply with This Court’s Fee Application
Guidelines
Grand Electric argues that many of the Electrical Funds’ billing entries must be stricken
because they do not comply with Nebraska Civil Rule 54.4. (Pl.’s Br. at 19-28, ECF No. 185.) First,
it claims that “attorney conferences” must be stricken from the award because the entries fail to
identify who was present, fail to identify the subjects discussed, and/or fail to disclose the duration
of the conference. (See id. at 21-23.) See also NECivR 54.4(a)(1)(A). Grand Electric’s argument
is well-taken.
None of the billing entries for attorney conferences clearly identify the
participants–though Grand Electric concedes that the participants can sometimes be inferred from
the records. (See id. at 21. See also Pl.’s Exs. 1, 3, 5, ECF Nos. 186-1, 186-3, 186-5.) Also, many
of the entries list attorney conferences in combination with other tasks, which makes it impossible
for me to determine precisely how long those conferences lasted. Still other entries list “attorneys
conference” without elaboration; such entries are clearly insufficient under the rules.
Grand Electric submits that I should reduce the Electrical Funds’ fee award by a total of
$17,355.34 due to the Funds’ failure to document properly its attorney conferences. I have already
stricken many of the “attorneys conference” entries, however, on the grounds that they are
10
The attorney who appears to have performed the majority of the work on behalf of the
Electrical Funds billed her time at a rate of $155 per hour. (See Electrical Funds’ Mot., Fletcher
Decl. Ex. A, ECF No. 181-1.)
23
duplicative or do not relate to the Electrical Funds’ collection action. (See supra Part III.B.1-2.)
Also, despite the records’ shortcomings, not all of the “attorneys conferences” are so poorly
documented that I cannot determine whether the time spent on them was unreasonable. I find that
an additional reduction of $2,000.00 is appropriate.
Next, Grand Electric argues that the Electrical Funds’ award should be reduced by
$13,155.29 because the billing entries for legal research do not comply fully with Nebraska Civil
Rule 54.4(a)(1)(B). (See Pl.’s Br. at 23-25, ECF No. 185.) I agree with Grand Electric that some
of the Electrical Funds’ legal research billing entries are insufficient; however, many of them provide
enough information for me to evaluate the reasonableness of the work, and many of them have
already been stricken from the award for reasons discussed above. I find that no additional
adjustment ought to be made to the award to account for the deficiencies in the “legal research”
billing.
4.
Whether Costs and Expenses May Be Included in the Award
The Electrical Funds seek $825.35 in expenses for lodging, mileage, parking, and computer-
assisted legal research. (Electrical Funds’ Mot. ¶ 6, ECF No. 181.)
Grand Electric argues that the Electrical Funds’ requests for copying expenses (totaling
$755.47) must be excluded from the award because they have not been supported adequately. (See
Pl.’s Br. at 27, ECF No. 185.) The copying costs will be excluded from the award–indeed, the
Electrical Funds have not incorporated a request for them into their motion for attorney’s fees. (See
Electrical Funds’ Mot. ¶ 6, ECF No. 181.) I note, however, that the copying costs have already been
taxed against Grand Electric. (See Taxation of Costs, ECF No. 189.)11
Grand Electric also argues that the lodging, mileage, parking, and computer-assisted research
expenses must be stricken from the award because these are not taxable costs under 28 U.S.C. §
1920. (See Pl.’s Br. at 31-35.) Although it is true that these are not taxable costs, they are
recoverable as part of the attorney’s fee award insofar as they are the sort of reasonable out-of-pocket
expenses that are normally charged to clients by attorneys. (See supra Part III.A.8.) I will strike
$202.39 from the award because computer-assisted legal research expenses are not recoverable in
11
Grand Electric filed no response to the Electrical Funds’ Bill of Costs. (See ECF Nos.
187-188.)
24
this circuit. See Standley v. Chilhowee R.-IV School Dist., 5 F.3d 319, 325 (8th Cir. 1993). I find,
however, that the remaining expenses sought by the Electrical Funds are reasonable.
In conclusion, I find that the Electrical Funds are entitled to recover attorney’s fees in the
amount of $20,847.42, plus expenses in the amount of $622.96, for a total award of $21,470.38.
IT IS ORDERED that:
1.
the Dakotas Funds’ motion to seal, (ECF No. 175), the Electrical Funds’ motion to
seal, (ECF No. 180), and Grand Electric’s motion to seal, (ECF No. 184), are denied;
2.
the Dakotas Funds’ motion for attorney’s fees, (ECF No. 176), is granted in part, and
they are entitled to an award of attorney’s fees and expenses totaling $27,818.69;
3.
the Electrical Funds’ motion for attorney’s fees, (ECF No. 181), is granted in part,
and they are entitled to an award of attorney’s fees and expenses totaling $21,470.38;
and
4.
the Judgment will be amended to reflect these awards.
Dated December 21, 2011.
BY THE COURT
s/ Warren K. Urbom
United States Senior District Judge
25
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