ATLAS SYSTEMS, INC. et al v. REDDY et al

Filing 74

MEMORANDUM OPINION filed. Signed by Magistrate Judge Tonianne J. Bongiovanni on 4/23/2021. (abr, )

UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
ATLAS SYSTEMS, INC., et al.,
Plaintiffs,
v.

Civil Action No. 16-5381 (MAS)
MEMORANDUM OPINION

REDDY, et al.,
Defendants.
BONGIOVANNI, Magistrate Judge
This matter comes before the Court upon application by Plaintiffs Atlas Systems, Inc. and
Atlas Hana L.L.C. (“Plaintiffs”) for attorneys’ fees and costs awarded pursuant to the District
Court’s December 4, 2020 Memorandum Opinion and Order awarding Plaintiffs attorneys’ fees
and costs associated with filing their Motion to Enforce and opposing Defendants’ competing
Motion (Docket Entry Nos. 68 and 69, respectively). Defendants Anji Reddy and Vision Soft
Consulting Inc. (“Defendants”) oppose Plaintiffs’ application. The Court has fully reviewed and
considered all arguments made in support of and in opposition to Plaintiffs’ application for
attorneys’ fees and costs. The Court considers this matter without argument pursuant to L.Civ.R.
78.1(b). For the reasons set forth below, Plaintiffs’ application is GRANTED IN PART.
I.

Background and Procedural History
The District Court awarded Plaintiffs attorneys’ fees and costs associated with filing their

Motion to Enforce Settlement and opposing Defendants’ competing Motion. (Docket Entry No.
68 at 19-20). Plaintiffs were “directed to submit documentation supporting the reasonable
attorneys’ fees and costs associated with filing their Motion to Enforce Settlement and Sanctions
within 14 days of this order.” (Docket Entry No. 69 at 2). The Court directed the parties to

confer, but they could not reach agreement about the amount of attorneys’ fees and costs to be
paid by Defendants.
On March 15, 2021, the Court narrowed the range of attorneys’ fees to be awarded from
Plaintiffs’ initial informal submissions. The Court noted that because the District Court could
have awarded fees for all time billed after September 11, 2017 (the date the settlement was
entered on the record during conference) but did not, fees and costs from the time period after
September 11, 2017 up until the District Court issued its Opinion and Order on December 4,
2020 but not directly related to the cross-motions are excluded. Although the Court said it would
consider whether awarding fees for work done after December 4, 2020 is appropriate, it directed
Plaintiffs’ counsel to separate the motion fees from the post-motion fees in its request. On April
1, 2021, Plaintiffs submitted their revised request. On April 5, 2021, Defendants submitted their
opposition to that request.
II.

Legal Standard
Generally, courts use the “lodestar” method in evaluating a fee application and, indeed, the

lodestar calculation is presumed to yield a reasonable attorney fee award. See Machado v. Law
Offices of Jeffrey, Civil Action No. 14-7401 (MAS) (TJB), 2017 WL 2838458, *2 (D.N.J. June
30, 2017). Under the lodestar method, an attorney’s reasonable hourly rate is multiplied by the
number of hours the attorney reasonably spent working on a matter. Interfaith Cmty. Org. v.
Honeywell Int’l, Inc., 426 F.3d 694, 703 n.5 (3d Cir. 2005) (citing Blum v. Stenson, 565 U.S. 886,
888 (1984) (citations omitted)).
The “party seeking attorney fees bears the ultimate burden of showing that its requested
hourly rates and the hours it claims are reasonable.” Id. (citing Rode v. Dellarciprete, 892 F.2d
1177, 1183 (3d Cir. 1990)). “Reasonable hourly rates are typically determined based on the market

rate in the attorney’s community for lawyers of similar expertise and experience.” Machado, 2017
WL 2838458, at *2 (citing Interfaith, 426 F.3d at 713). Evans v. Port Auth. of N.Y. and N.J., 273
F.3d 346, (3d Cir. 2001). With respect to the hours claimed, it is incumbent upon the Court to
“exclude hours that are not reasonably expended.” Rode, 892 F.2d at 1183 (citing Hensely v.
Eckerhart, 461 U.S. 424, 433 (1983)). “Hours are not reasonably expended if they are excessive,
redundant, or otherwise unnecessary.” Id. The Court, however, may not reduce a fee award sua
sponte. Instead, “it can only do so in respect to specific objections made by the opposing party.
But once the opposing party has made a specific objection, the burden is on the prevailing party to
justify the size of its request.” Interfaith, 426 F.3d at 711 (citing Bell v. United Princeton Props.,
Inc., 884 F.2d 713, 719 (3d Cir. 1989).
Further, while the lodestar calculation is “strongly presumed to yield a reasonable fee”
(Washington v. Phila. County Ct. of C.P., 89 F.3d 1031, 1035 (3d Cir. 1996) (citing City of
Burlington v. Dauge, 505 U.S. 557 (1992)), “[t]he court can adjust the lodestar downward if the
lodestar is not reasonable in light of the results obtained.” Rode, 892 F.2d at 1183 (citing
Hensley, 461 U.S. at 434-37). “Indeed, ‘the most critical factor’ in determining the
reasonableness of a fee award ‘is the degree of success obtained.’” Farrar v. Hobby, 506 U.S.
103, 114 (1992) (quoting Hensley, 461 U.S. at 436). In fact, the Court “retains a great deal of
discretion in deciding what a reasonable fee award is” (Bell, 884 F.2d at 721), and, it is
understood that “in determining whether the fee request is excessive . . . the court will inevitably
engage in a fair amount of ‘judgment calling’ based upon its experience with the case and the
general experience as to how much a case requires.” Evans, 273 F.3d at 362.

III.

Analysis
Here, Plaintiffs first seek to be reimbursed for attorneys’ fees from Plaintiffs’ former

counsel at Day Pitney, LLP for work related to the Motion to Enforce and competing Motion by
Defendants. Several different individuals performed work from that firm on behalf of Plaintiffs,
with various billing rates. S. Cardinale (Paralegal) billed at a rate of $135 per hour; A. Aviles
(Associate) billed $315 per hour; P. McCarthy (Of Counsel) billed $570 per hour; and R. Brown
(Partner) billed $585 per hour. (Tauriello Certification dated April 1, 2020 [sic], ¶¶ 7,13). 1 Mr.
Brown serves as the Chair of Day Pitney’s Intellectual Property Litigation practice group and has
expertise in this specialized area. (Id., ¶ 16). Plaintiffs had a negotiated discount of 29.53% for
all legal fees with Day Pitney, which Plaintiffs have passed along to reduce these stated hourly
rates. (Id., ¶ 7).
While Defendants oppose the overall amount of Plaintiffs’ request, they do not argue
specifically that the hourly rates requested are too high.
Despite Defendants’ overall objections, the Court finds the hourly rates by Plaintiffs’
former counsel at Day Pitney are reasonable. In reaching this conclusion, the Court notes that
Plaintiffs’ negotiated discount has appropriately been applied to the requested hourly rates.
There is no dispute over the costs requested by Plaintiffs, i.e., those associated with UPS
($15.35) and photocopies/service expenses ($42.75). As a result, the Court shall reimburse
Plaintiffs for same.
While Defendants object to the overall amount of Plaintiffs’ fee request, they do not
specifically object to any of the line items in the amounts requested for the work of Day Pitney.

1

This certification was submitted on April 1, 2021 but mistakenly listed the date as April 1, 2020.

Plaintiffs argue that the hours sought are reasonable. “The record establishes that without
Plaintiff filing the within motion and subsequent efforts by Corporate Counsel to protect the
Plaintiff’s interests in the within matter, payment would not have been made. The record
demonstrates that even with significant legal effort, defendants had remained non-compliant with
their obligations.” (Tauriello Certification, ¶ 13). As previously explained, “‘the most critical
factor’ in determining the reasonableness of a fee award ‘is the degree of success obtained.’”
Farrar v. Hobby, 506 U.S. at 114. Plaintiffs’ former counsel were successful in their efforts.
The Court has thoroughly reviewed the billing records as well as the submissions of the
parties and finds both the discounted hourly rates and hours billed of the attorneys and staff at
Day Pitney to be reasonable and within the terms of the award by the District Court. Defendant
focuses on the language “Writeoff” and “No Charge” written in the Day Pitney bill attached to
Mr. Tauriello’s Certification dated January 30, 2021 as Exhibit D. (Defendants’ Brief in
Opposition to Plaintiff’s Request for Award of Attorney Fees and Costs (“Def Brief”) at 5)
(“However, Day & Pitney’s (plaintiff’s former attorney firm) clear and readable bills show the
motion has been written off and there remain no charges to the plaintiff in regard to the attorney
fees.”). Though Defendants make much of this argument, courts routinely award attorney’s fees
in cases where plaintiff has a contingency arrangement with his or her attorney and is never
billed for those fees. See Bland v. SMS Demag, Inc., Civil Action No. 04-1333, 2006 WL
8456864 (W.D.Pa. May 23, 2006) (awarding attorney’s fees in ERISA case where attorney did
not intend to charge plaintiff for those fees absent award against defendant).
The Court, however, declines to award the Plaintiffs attorneys’ fees and costs for work
performed by Mr. Tauriello that is unconnected to the Plaintiffs’ Motion to Enforce the
settlement and Defendants’ competing Motion. As noted by the District Court, the general rule

“is that each party to a lawsuit bears its own attorneys’ fees.” (Opinion at 19). The Court finds
no reason to make an exception for legal work by Plaintiffs’ counsel that is unconnected to the
specific award made by the District Court. (See id.)
In total then, Plaintiffs shall be awarded attorneys’ fees and costs in the amount of
$17,586.10. This breaks down to $17,528.00 after the discount of 29.53% is applied to the subtotal
of legal fees of $24,873.00 (1.0 hours of work at $135 per hour for S. Cardinale (Paralegal); 40.5
hours of work at $315 per hour for A. Aviles (Associate); 0.8 hours of work at $570 per hour for
P. McCarthy (Of Counsel); and 19.7 hours of work at $585 per hour for R. Brown (Partner)) plus
$58.10 in costs. Defendants are directed to pay same no later than May 14, 2021.
IV.

Conclusion
For the reasons stated above, Plaintiffs’ motion for attorney’s fees and costs is GRANTED

IN PART. An appropriate Order follows.
Dated: April 23, 2021

____
s/Tonianne J. Bongiovanni____________
HONORABLE TONIANNE J. BONGIOVANNI
UNITED STATES MAGISTRATE JUDGE