HARI HOTELS, LLC v. SNG PROPERTIES LLC et al
Filing
37
OPINION. Signed by Judge Noel L. Hillman on 3/16/2020. (dmr)
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
HARI HOTELS, LLC,
Civil Action No. 18-8018
Plaintiff,
OPINION
v.
SNG PROPERTIES LLC and A
HUNTS MILLS ASSOCIATES, LLC,
Defendants.
APPEARANCES:
MALCOLM S. GOULD
SILVERANG ROSENZWEIG & HALTZMAN
900 E. 8TH AVENUE
SUITE 300
KING OF PRUSSIA, PA 19406
MARK S. HALTZMAN
SILVERANG ROSENZWEIG & HALTZMAN
900 E. 8TH AVENUE
SUITE 300
KING OF PRUSSIA, PA 19406
Counsel for Plaintiff.
KENNETH S. GOODKIND
FLASTER/GREENBERG, P.C.
1810 CHAPEL AVENUE WEST
CHERRY HILL, NJ 08002
Counsel for Defendants.
HILLMAN, District Judge
This matter comes before the Court on motion of Hari
Hotels, LLC (“Plaintiff”) for an award of attorneys’ fees and
costs (the “Motion”).
(ECF No. 30).
SNG Properties LLC and A
Hunts Mills Associates LLC (collectively, “Defendants”)
challenge the reasonableness of the fee requested by Plaintiff.
For the reasons that follow, the Court will grant Plaintiff’s
Motion in its entirety.
BACKGROUND
On September 21, 2017, Plaintiff agreed to purchase a
Holiday Inn in Clinton, New Jersey from Defendants (the
“Agreement”).
See (ECF No. 1-1 at 1).
The Agreement required
Plaintiff to make an initial deposit of $100,000 to secure its
performance, (Agreement at ¶4(a)), but also provided a due
diligence period of 45 days, within which, Plaintiff had an
absolute right to cancel the transaction and have its deposit
returned.
See (Agreement at ¶6(v)) (“If, on or before the
expiration of the Due Diligence Period, Buyer elects to
terminate this Agreement, the Initial Deposit shall be returned
to Buyer . . .”).
Before the due diligence period expired, Plaintiff
exercised its right to terminate the Agreement and asked that
its deposit be returned.
Defendants refused and Plaintiff filed
suit seeking return of the deposited funds, along with
attorneys’ fees and costs related to the litigation.
See
(Agreement at ¶22(j)) (The Agreement explains that “[i]n
connection with any litigation . . . arising out of this
Agreement, the prevailing party shall be entitled to recover
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reasonable attorney’s fees and court costs from the other
party”).
After various court-sponsored conferences and settlement
efforts, the parties presented this Court with a stipulated
order largely resolving this matter, which this Court entered on
July 12, 2019.
(ECF No. 29).
In the stipulated order, the
parties agreed that Defendant would return Plaintiff’s entire
deposit, and the parties further agreed that Plaintiff shall “be
considered a ‘prevailing party’ entitled to submit a . . .
Motion for recovery of its reasonable attorneys’ fees and costs
incurred in connection with the dispute.”
(ECF No. 29).
On August 23, 2019, Plaintiff submitted its Motion.
Defendants oppose the request on the basis that the fee
Plaintiff seeks is not reasonable. (ECF No. 33).
This matter is
fully briefed and ripe for adjudication.
DISCUSSION
I.
Subject Matter Jurisdiction
The Court exercises subject matter jurisdiction pursuant to
28 U.S.C. § 1332.
II.
Legal Standard & Disputed Issues
New Jersey law governs the parties’ relationship.
(Agreement at ¶22(i)).
As such, in determining the
reasonableness of Plaintiff’s fee request, the Court looks to
New Jersey law for guidance.
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“In determining the reasonableness of an attorneys’ fee
award, the threshold issue ‘is whether the party seeking the fee
prevailed in the litigation.’”
Litton Indus., Inc. v. IMO
Indus., Inc., 982 A.2d 420, 428 (N.J. 2009) (citing N. Bergen
Rex Transp., Inc. v. Trailer Leasing Co., 730 A.2d 843 (N.J.
1999)).
“The next step in determining the amount of the award is to
calculate the ‘lodestar,’ which is that number of hours
reasonably expended by the successful party’s counsel in the
litigation, multiplied by a reasonable hourly rate.”
Litton,
982 A.2d at 428 (citing Furst v. Einstein Moomjy, Inc., 860 A.
2d 435 (N.J. 2004)).
Under the lodestar approach, “court[s]
determine[ ] an attorney’s lodestar award by multiplying the
number of hours he or she reasonably worked on a client’s case
by a reasonable hourly billing rate for such services given the
geographical area, the nature of the services provided, and the
experience of the lawyer.”
S.S. Body Armor I., Inc. v. Carter
Ledyard & Milburn LLP, 927 F.3d 763, 773 (3d Cir. 2019) (quoting
Gunter v. Ridgewood Energy Corp., 223 F.3d 190, 195 n.1 (3d Cir.
2000)).
The lodestar method “yields a fee that is presumptively
sufficient[.]”
S.S. Body Armor, 927 F.3d at 773 (quoting Perdue
v. Kenny A. ex rel. Winn, 559 U.S. 542, 552, 130 S. Ct. 1662,
176 L. Ed. 2d 494 (2010)).
Courts may not reduce an award sua
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sponte; rather, they may only do so in response to specific
objections made by the opposing party.
Bell v. United Princeton
Properties, Inc., 884 F.2d 713, 719 (3d Cir. 1989).
Once the
opposing party has made a specific objection, the burden is on
the plaintiff to justify the size and reasonableness of its
request.
Wade v. Colaner, No. 06-cv-3715-FLW, 2010 WL 5479625,
at *4 (D.N.J. Dec. 28, 2010) (citing Interfaith Cmty. Org. v.
Honeywell Int’l, Inc., 426 F.3d 694, 713 (3d Cir. 2005)).
III. Plaintiff’s Motion For Fees and Costs
A. Plaintiff is the Prevailing Party
There is no dispute that Plaintiff is the prevailing party
in this action.
(ECF No. 29) (stipulating that Plaintiff is the
prevailing party and may pursue its fees).
As such, the Court
turns to the lodestar calculation.
B. Lodestar Calculation
1. Defendants Do Not Challenge Plaintiff’s Counsel’s
Hourly Rate
Defendants do not challenge the hourly rate billed by
Plaintiff’s counsel or their staff.
(ECF No. 33 (“Def. Br.”) at
5) (“Defendants do not object to the hourly rates of
Plaintiff[’]s counsel for work that needed to be performed by
attorneys of their skill levels and experience.”).
The
following individuals billed at the following rates during times
relevant to the current fee petition:
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(1)
Mark Haltzman, Esq., a partner, billed between $425 and
$450 per hour;
(2)
Malcolm Gould, Esq., senior counsel, billed between $325
and $365 per hour;
(3)
Molly Hanford, a senior paralegal, billed $175 per hour;
and
(4)
Amy Bins, a paralegal, billed $150 per hour.
Because Defendants do not challenge these rates, the Court
will adopt them in conducting the present lodestar analysis.
2. Reasonableness of Hours Expended
Plaintiff seeks a total fee and cost award of $74,384.08.
(ECF No. 36 at 2).
Plaintiff supports its request by submitting
individualized time entries from counsel’s firm along with an
explanation of its fees incurred for each phase of litigation.
Specifically, Plaintiff represents its counsel spent
•
$3,285.00 worth of time during the complaint filing
and pre-discovery stage;
•
$19,222.50 worth of time during the written
discovery/pre-depositions stage;
•
$25,395.00 worth of time during the
depositions/remaining discovery stage;
•
$9,219.00 worth of time during the settlement stage;
•
$6,555.00 worth of time drafting the initial fee
petition; and
•
$9,105.50 worth of time drafting the reply to the fee
petition.
(ECF No. 36 at 2).
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Plaintiff also explains that it incurred $1,602.08 in
litigation costs in this action.
(ECF No. 36 at 2).
Plaintiff
submits all individual time entries from the billing attorneys
and staff for the Court’s review.
These time entries clearly
identify the date the work was completed, the amount of time
spent, the individual completing the task, the fee sought for
the task completed, and the task completed during that
timeframe.
Defendants argue that the fee requested by Plaintiff is (1)
unreasonable in light of the amount in dispute, (2) inflated due
to overstaffing and unnecessary use of senior lawyer time on
associate-level tasks, (3) inflated because Plaintiff seeks fees
for administrative tasks, and (4) should be reduced due to vague
time entries.
(ECF No. 33 at 1).
The Court disagrees with
Defendants’ objections.
a. The Amount In Dispute Does Not Render Plaintiff’s
Fee Request Unreasonable
While Defendants argue generally that “Plaintiff's fees are
not reasonable given the amount in dispute,” (Def. Br. at 1),
Defendants do not explain why the amount at issue requires a
reduction in the fee to be awarded.
In fact, available
precedent suggests that a fee award should not be reduced solely
because of its relation to the amount of damages awarded.
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“[A] court may not reduce a fee award based on a
proportionality analysis between the damages awarded and the
fees requested[.]”
Roccisano v. Township of Franklin, No. 11-
6558, 2015 WL 3649149 at *19 (D.N.J. June 11, 2015).
Instead,
courts may account for the overall success of the prevailing
party in the action, which may include consideration of “[t]he
amount of damages awarded” in relation to the “amount of damages
requested[.]”
Id. (quoting Washington v. Philadelphia Cnty.
Court of Common Pleas, 89 F.3d 1031, 1042 (3d Cir. 1996))
(emphasis removed).
In this case, Plaintiff obtained a complete victory: it
sought return of its $100,000 deposit and obtained a refund of
$100,000.
As such, the Court finds no reason to reduce the fee
award for reduced success, as Plaintiff fully succeeded.
If
anything, Plaintiff’s complete victory supports a finding that
no reduction is necessary.
See Roccisano, No. 2015 WL 3649149
at *19.
b. The Fee Sought Need Not Be Reduced Due To Staffing
Choices
Defendants argue that any fee award should be reduced
because Plaintiff used more expensive senior lawyer time for
tasks that could have been completed by less expensive, more
junior lawyers.
(ECF No. 33 at 5-6).
Defendants specifically
identify time entries for tasks they argue should have been
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handled by more junior lawyers.
See (ECF No. 33 at 7).
Defendant identifies William C. Katz, Esq., a more junior lawyer
at Plaintiff’s firm, as someone who could have been staffed on
this matter, suggesting the Mr. Gould could have been
substituted for Mr. Katz.
However, Mr. Haltzman certifies that
Mr. Katz’s rate and Mr. Gould’s rate during the relevant period
were the same.
(ECF No. 36-1 at ¶¶9-13) (“During almost the
entire pendency of this litigation, Mr. Gould’s time was billed
at an ‘associate rate’ equal to that of Mr. Katz.”).
As such, the evidence proves the time billed by Plaintiff’s
counsel was not inflated by staffing the matter with more
expensive counsel; instead, Plaintiff staffed this matter with
lawyers adequately billing at associate-level rates for
associate level tasks – rates Defendants do not challenge.
Replacing Mr. Katz with Mr. Gould would have no material effect
on the fee application.
As such, this specific objection is
rejected.
c. Plaintiff Adequately Supports Its Fee Application
With Time Entries and Explanations
Defendants challenge more than fifty of Plaintiff’s
counsel’s time entries as vague.
Plaintiff argues that it has
adequately supported its fee expenditures.
Attorneys seeking compensation must document the hours for
which payment is sought “with sufficient specificity.”
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Washington v. Philadelphia Cty. Court of Common Pleas, 89 F.3d
1031, 1037–38 (3d Cir. 1996) (quoting Keenan v. City of
Philadelphia, 983 F.2d 459, 472 (3d Cir. 1992)).
“[A] fee
petition is required to be specific enough to allow the district
court ‘to determine if the hours claimed are unreasonable for
the work performed.’”
Keenan, 983 F.2d at 472 (citing Rode v.
Dellarciprete, 892 F.2d 1177, 1190 (3d Cir. 1990)).
However, specificity is only required to the extent
necessary for the court “to determine if the hours claimed are
unreasonable for the work performed.”
Washington, 89 F.3d at
1037–38 (quoting Rode, 892 F.2d at 1190).
The Third Circuit has
explained that a fee petition should include “some fairly
definite information as to the hours devoted to various general
activities, e.g., pretrial discovery, settlement negotiations,
and the hours spent by various classes of attorneys, e.g.,
senior partners, junior partners, associates.”
Id.
However,
“it is not necessary to know the exact number of minutes spent
nor the precise activity to which each hour was devoted nor the
specific attainments of each attorney.”
Washington, 89 F.3d at
1037–38 (quoting Rode, 892 F.2d at 1190).
Defendants challenge dozens of time entries, each of which
the Court has reviewed.
The Court finds the entries challenged
are not so vague as to require reduction of the fee requested.
For example, Defendants challenge as vague Mr. Gould’s billing
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entries for “[r]eview notice of removal; review issues regarding
litigation strategy” and “review issues regarding settlement.”
The Court is confident in its ability to understand what Mr.
Gould was accomplishing during those times with the degree of
specificity required by Rode, 892 F.2d at 1190.
While
Plaintiff’s counsel may not have specified exactly what
documents they were reviewing, such specificity is not
necessarily required.
See Washington, 89 F.3d at 1037–38
(quoting Rode, 892 F.2d at 1190).
The Court’s confidence in its understanding is bolstered by
Plaintiff’s phase-by-phase explanation of the time it spent,
which the Court has used to cross-reference the time entries
submitted.
See (ECF No. 36 at 2).
Measuring the aggregated
phase-by-phase billing alongside the individualized billing
entries, the Court is satisfied Plaintiff has identified the
tasks it undertook in support of its case with enough
specificity to allow this Court to determine those efforts were
not unreasonable or cumulative.
As such, Defendants’ objection
to Plaintiff’s fee request on this point is rejected.
d. Plaintiff Is Entitled to Recover Fees Paid By
Plaintiff for Paralegal Efforts
Defendants argue that almost all tasks delegated to the
paralegals employed by Plaintiff’s counsel’s firm are not
chargeable or reasonably recoverable.
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The Court disagrees.
Nearly all of the paralegal time entries refer to reviewing
and revising pleadings, preparing documents for filing and
transmittal, working with process severs, calendaring case
management deadlines, reviewing filing deadlines and orders from
the court, and other case management related tasks.
Defendants
point this Court to its decision in Bilazzo v. Portfolio
Recovery Assocs., LLC, 876 F. Supp. 2d 452 (D.N.J. June 25,
2012) (Hillman, J.) in arguing that such fees should not be
recoverable in this action.
In Bilazzo, the Court held that to be recoverable as
reasonable attorneys’ fees, administrative tasks must be of the
typed billed to a client.
See Bilazzo v. Portfolio Recovery
Assocs., LLC, 876 F. Supp. 2d at 471-472 (citing Levy v. Glob.
Credit & Collection Corp., No. 10-cv-4229, 2011 WL 5117855, at
*6 (D.N.J. Oct. 27, 2011)) (“As a general rule, time that would
not be billed to a client cannot be imposed on an adversary. . .
.
Thus, administrative tasks, which are not the type normally
billed to a paying client, may not be recovered by a party
through a fee petition.”).
In this case, the evidence reveals
the fees Defendants challenge were not only billed to Plaintiff,
but in fact paid by Plaintiff.
(ECF No. 30-4 at ¶44) (The bills
submitted by Plaintiff’s counsel “reflect the actual fees and
costs billed to the client and paid by the client”).
Because
Plaintiff paid these fees, and because they were in fact billed
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to the client, Bilazzo supports Defendants’ obligation to pay
them as well. 1
e. Plaintiff Is Entitled To Recover Fees Relating To
The Petition And Reply
Defendants argue that fees relating to Plaintiff’s motion
and reply papers should not be awarded because (1) the work
should have been done by less senior, less expensive counsel, 2
and (2) Plaintiff spent too much time on the fee petition and
reply.
In a proceeding to determine an award of attorneys’ fees,
an attorney may include in a supporting affidavit fees for
preparing the petition seeking fees and litigation costs.
Bagby
v. Beal, 606 F.2d 411, 416 (3d Cir. 1979); Institutionalized
Juveniles v. Sec’y of Pub. Welfare, 758 F.2d 897, 925 (3d Cir.
1985) (permitting recovery of fees for time spent on fee
1
Defendants make a similar argument as to travel time, arguing,
in a single sentence, that travel time should be compensated at
only 50% of the normal rate. A review of counsel’s time entries
reveals only one entry capturing travel time. (ECF No. 30-4 at
53) (billing entry from Mr. Haltzman, a portion of which is for
“travel to/from court”). Plaintiff was forced to compensate
Plaintiff’s counsel at 100% of its rate for this time, which was
the rate reasonably agreed to by client and counsel. The Court
finds no basis to reduce that rate for Defendants’ benefit,
particularly where the parties agreed to indemnify each other
for fees and costs incurred if litigation pursued and the other
party was deemed the prevailing party.
2
Because the Court previously disposed of this issue, supra, it
need not readdress it here.
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petition, but reducing the award due to limited success on the
merits).
The Court finds Plaintiff did not spend excessive time on
the fee petition.
Once drafted, Defendants submitted a
multifaceted opposition, challenging the fees on numerous
grounds, which Plaintiff was forced to respond to.
Plaintiff
was forced to incur legal fees in doing so, which Plaintiff
actually paid to counsel.
Pursuant to the Agreement, Defendant
is responsible for those expenses.
Consistent with the parties’
Agreement, the Court will not reduce the fees sought by
Plaintiff for briefing the present motion.
C. Costs
Defendants argue that Plaintiff fails to adequately support
its cost application.
The Court disagrees.
Plaintiff seeks $1,602.08 in litigation costs, which
includes (1) $250 for its complaint filing fee in state court,
(2) $43.12 for parking and mileage relating to court
appearances, (3) $195 for subpoena service costs, (4) $28.96 for
FedEx charges, and (5) $1,085 for the deposition transcript of
Jerry Swon.
(ECF No. 30-4 at ¶78).
supporting documents for these costs.
59).
Plaintiff submitted
See (ECF No. 30-4 at 57-
Defendants do not explain how such costs are excessive or
unwarranted, and these costs appear adequately specific in
nature.
Defendants have not met their burden in challenging the
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reasonableness of these costs, and the Court is satisfied that
they are, in fact, reasonable.
CONCLUSION
Finding no basis to reduce the fees and costs sought by
counsel, Plaintiff shall be awarded $72,782 in fees and
$1,602.08 in costs, for a total award of $74,384.08.
An
appropriate Order will follow.
Date: March 16, 2020
At Camden, New Jersey
s/ Noel L. Hillman
NOEL L. HILLMAN, U.S.D.J.
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