Agape Flights, Inc. v. Covington Aircraft Engines, Inc. et al

Filing 322

OPINION AND ORDER by Judge Frank H. Seay granting 298 Motion for Attorney Fees(trl, Chambers)

IN THE UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF OKLAHOMA
AGAPE FLIGHTS, INC.,
Plaintiff,
v.
COVINGTON AIRCRAFT ENGINES,
INC., et al.,
Defendants.

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No. CIV-09-492-FHS

OPINION AND ORDER
Defendants, Pratt & Whitney Canada Corporation (“P&WC”) and
Hamilton Sundstrand Corporation (“Sundstrand”), have filed a joint
Motion for Attorney Fees (Dkt. No. 298) seeking awards in the
amount

of

$232,945.58

and

$306,301.83,

Plaintiff, Agape Flights, Inc. (“Agape”).

respectively,

against

P&WC and Sundstrand, as

prevailing parties in this action, contend they are entitled to
such fees pursuant to Okla.Stat.tit. 12, §§ 936, 939, and 940. The
parties have fully briefed the issues and the Court held a hearing
on the motion on January 23, 2013.

Having considered the parties

respective submissions and arguments, the Court finds the Motion
for Attorney Fees (Dkt. No. 298) should be granted to the extent
that attorney fees are awarded to P&WC in the amount of $194,746.31
and to Sundstrand in the amount of $260,303.85.
In its Amended Complaint filed on April 16, 2010, Agape
asserted claims against P&WC and Sundstrand for negligence, strict
products liability, and breach of warranty arising out of a
December 20, 2007, airplane crash.

Agape sought damages for the

loss of its aircraft and consequential damages resulting from such
loss.

On September 15, 2010, P&WC and Sundstrand filed separate
1

Motions for Summary Judgment (Dkt. Nos. 127 and 128) asserting, as
their primary argument, that Agape’s claims are barred by the
General Aviation Revitalization Act of 1994 (“GARA”), 49 U.S.C. §
40101.1

In an Opinion and Order entered on June 28, 2011, the

Court granted summary judgment in favor of P&WC and Sundstrand on
the basis that the 18-year statute of repose under GARA operated to
bar all claims asserted by Agape against P&WC and Sundstrand.

On

October 26, 2012, the Court entered Judgment in favor of P&WC and
Sundstrand in accordance with its June 28, 2011, Opinion and Order.
On November 19, 2012, P&WC and Sundstrand filed their Motion for
Attorney Fees (Dkt. No. 298).
In this diversity action, attorney fees are governed by
Oklahoma law.
1445 (10

th

Oulds v. Principal Mut. Life Ins. Co., 6 F.3d 1431,

Cir. 1993)(“[I]n diversity cases generally, and certainly

in this circuit, attorney fees are determined by state law and are
substantive

for

diversity

purposes.”)(alteration

in

original)(quoting King Resources Co. v. Phoenix Resources Co., 651
F.2d 1349, 1353 (10th Cir. 1981).

In their briefing, the parties

recognize the application of Oklahoma law to the request for
attorney

fees.

In

support

of

their

application,

P&WC

and

Sundstrand contend Oklahoma law provides for the recovery of
attorney fees to prevailing parties in actions for breach of
warranty (express and implied) and negligent injury to property.
The provision for recovery of attorney fees in actions for breach
of express warranty, provides:

1

In their respective summary judgment motions, P&WC and
Sundstrand also argued that Agape’s tort claims were barred by
Oklahoma’s economic loss doctrine and that Agape’s breach of
warranty claim was barred by Oklahoma law. Because the motions
for summary judgment were resolved on the GARA issues, the Court
did not address these alternative arguments.
2

In any action brought to recover damages for breach of an
express warranty or to enforce the terms of an express
warranty made under Section 2-313 of Title 12A of the
Oklahoma Statutes, against the seller, retailer,
manufacturer,
manufacturer’s
representative
or
distributor, the prevailing party shall be allowed a
reasonable attorney fee to be set by the court, which
shall be taxed and collected as costs.
Okla. Stat. tit. 12, § 939.

The statutory authority for recovery

of attorney fees in actions for breach of implied warranty,
provides:
In any civil action to recover for labor or services
rendered, or on an open account, a statement of account,
account stated, note, bill, negotiable instrument, or
contract relating to the purchase or sale of goods,
wares, or merchandise, unless otherwise provided by law
or the contract which is the subject of the action, the
prevailing party shall be allowed a reasonable attorney
fee to the set by the court, to be taxed and collected as
costs.
Okla. Stat. tit. 12, § 936; see United General Ins. Co. v. Crane
Carrier Co., 695 P.2d 1334, 1336-39 (Okla. 1984)(attorney fees are
recoverable under the authority of Okla. Stat. tit. 12, § 936 on an
implied warranty cause of action).

Finally, in actions for the

negligent injury to property, Oklahoma law provides:
In any civil action to recover damages for the negligent
or willful injury to property and any other incidental
costs related to such action, the prevailing party shall
be allowed reasonable attorney’s fees, court costs and
interest to be set by the court and to be taxed and
collected as other costs of the action.
Okla. Stat. tit. 12, § 940.
Agape recognizes this Oklahoma statutory authority for the
award of attorney fees to prevailing parties in breach of warranty
3

and negligent injury to property cases, but it contends that this
action is primarily one involving a product liability claim and,
more pointedly, one involving a defense, the GARA statute of
repose, which was designed for application to product liability
actions. Agape contends that Oklahoma law does not provide for the
recovery of attorney fees in product liability actions.

United

General Insurance Co., 695 P.2d at 1337 (“There are no Oklahoma
statutes authorizing attorney fees to the prevailing party in a
manufacturers’ product liability action.”).

As a result, Agape

contends P&WC and Sundstrand are not entitled to be compensated for
their work in connection with the GARA defense and, at most, are
entitled to recover attorney fees in connection with those claims
for which Oklahoma law authorizes recovery - breach of warranty and
negligent injury to property.

In response, P&WC and Sundstrand

contend that an apportionment of fees is not appropriate. P&WC and
Sundstrand argue for a full fee recovery for the work performed
defending this action.2

It is their position that the GARA defense

was common to all claims asserted by Agape.

Given this common

defense and their status as prevailing parties to Agape’s breach of
warranty

and

negligent

injury

to

property

claims,

P&WC

and

Sundstrand contend apportionment between the different theories of
recovery is not appropriate and that they are entitled to be
compensated for all GARA-related work.
The Court finds that P&WC and Sundstrand, as prevailing
parties in this action, are entitled to an attorney fee recovery.
See

Travelers

Indemnity

Company

v.

Hans

Lingl

Anlagenbau

Verfahrenstechnik GMBH & Co. KG, 189 Fed.Appx. 782, 788 (10th Cir.

2

P&WC and Sundstrand have eliminated from their fee
requests time spent in connection with their prosecution of
third-party claims against Kansas Aviation of Independence, LLC
(“Kansas Aviation”) and Banyan Air Services, Inc. (“Banyan”).
4

2006)(acknowledging prevailing party entitlement to attorney fees
pursuant to Okla. Stat. tit 12, §§ 936, 939 and 940 on claims for
breach of warranty and negligent or willful injury to property)and
Underwriters at Loyd’s of London v. North American Van Lines, 829
P.2d 978, 981 (Okla. 1992)(“prevailing party” in an action brought
pursuant to Okla. Stat. tit. 12, § 940 is “the party for whom
judgment is rendered”).

It is undisputed that Agape brought two

claims against P&WC and Sundstrand which authorize an award of
attorney fees to a prevailing party - claims for breach of warranty
and negligent injury to property.

As the prevailing parties on

those claims, P&WC and Sundstrand are clearly entitled to recover
their fees for services rendered in connection with the defense of
those claims.
The calculation of the proper attorney fee amount should not
include a deduction for GARA-related work as the Court finds the
assertion of the GARA statute of repose defense was applicable to
all claims brought by Agape.

The successful prosecution by P&WC

and Sundstrand of their GARA motions for summary judgment resulted
in a finding by the Court that the 18-year statute of repose under
GARA

operated

to

bar

all

claims

asserted

by

Agape.

An

apportionment of fees between those claims authorizing a fee award
and those claims which do not authorize an award is therefore not
appropriate.

The claims herein - product liability, breach of

warranty, and negligent injury to property - are

inextricably

intertwined given the application of the common GARA defense
asserted

by

P&WC

and

Sundstrand.

Travelers

Indemnity,

189

Fed.Appx. at 788 (full attorney fee award appropriate where “the
time defendants’ attorneys devoted to the products-liability claims
was necessarily incurred in defending the other claims [breach of
warranty and negligent or willful injury to property], for which
attorney fees are authorized.”).

Consequently, the Court will not
5

adjust

the

fees

as

suggested

by

Agape

to

reflect

claim

apportionment.
The voluminous time records submitted by P&WC and Sundstrand
include the affidavits of attorneys, Sidney G. Dunagan, Ralph V.
Pagano, A. Thomas Elder, Jr., and Thomas R. Pantino.

Mr. Dunagan

and his firm, GableGotwals of Tulsa, Oklahoma, were hired as local
counsel for P&WC to work in conjunction with national counsel for
aviation products, Fizpatrick, Hunt, Tucker, Collier, Pagano,
Aubert, LLP of New York, N.Y. (“F&H”), the firm in charge of the
defense of the lawsuit.

Mr. Elder and his firms, Phillips Murrah

P.C. (“Phillips Murrah”) and Smith, Rhodes, Stewart & Elder, PLLC,
(“Smith & Rhodes”), were hired as local counsel for Sundstrand to
work with F&H in defense of the suit.3

The net fees requested by

counsel are set forth in their respective affidavits4:
Sidney G. Dunagan (GableGotwals - P&WC)
Ralph V. Pagano (F&H - P&WC)

$81,027.75
$151,917.83

3

The parties inform the Court that P&WC and Sundstrand are
now subsidiaries of United Technologies Corporation (“United
Technologies”), which is represented by F&H as national counsel.
Except for a duplication of effort argument to be addressed
below, Agape does not contest the use of separate local counsel
for P&WC and Sundstrand and their association with separate
lawyers from the F&H firm. In this regard, the Court notes the
potential conflict of interest between P&WC and Sundstrand given
the shipment of the subject fuel pump by Sundstrand to P&WC and
the possible indemnification claim arising from that transaction.
The retention of separate counsel under these circumstances is
appropriate.
4

Each affidavit sets forth the hourly rates and the total
hours worked on the case by individuals with the respective
firms. Deductions of a specified amount are then made to account
for the time spent on the third-party claims against Kansas
Aviation and Banyan, with the result being the net fee requests
by the respective firms.
6

A. Thomas Elder, Jr. (Phillips Murrah
and Smith & Rhodes - Sundstrand)

$197,425.00

Thomas A. Pantino (F&H - Sundstrand)

$108,876.83

As these affidavits reflect, P&WC seeks a total fee recovery in the
amount of $232,945.58 and Sundstrand seeks a total fee recovery in
the amount of $306,301.83.
Initially, the Court’s review of these time records does not
warrant any reduction for what Agape labels as “block billing.”
The billing practice termed “block billing” is a reference “to the
time-keeping method by which each lawyer and legal assistant enters
the total daily time spent working on a case, rather than itemizing
the time expended on specific tasks.”

Harolds Stores, Inc. v.

Dillard Dept. Stores, Inc., 82 F.3d 1533, 1554 n. 15 (10th Cir.
1996). Citing some examples from the time records submitted by Mr.
Dunagan on behalf of GableGotwals, Agape contends “block billing”
has been utilized and that it is “difficult to apportion fees
unless a single category of work was done on a particular day.”
Agape Response Brief (Dkt. No. 308) at 8.

Agape’s argument has no

merit, however, because as the Court noted above there is no basis
for an apportionment between the fee-authorizing claims (breach of
warranty and negligent injury to property) and the claim for which
a fee is not authorized (product liability).

Additionally, the

Court’s review of the time records reveals sufficient detail and
breakdown of tasks to allow the Court to determine the propriety of
the

compensation

particular entry.

sought

for

those

tasks

contained

within

a

While more detail is always desirable, the

Court’s assessment of the propriety of the tasks and compensation
sought has not been hindered by the time records submitted.
Agape also voices an objection to the hourly rates charged by
7

New York counsel from the F&H firm as not in accord with the
prevailing rates in the Eastern District of Oklahoma.

Local

counsel, Mr. Dunagan and Mr. Elder, charged at a rate of $250 per
hour

for

work

performed

in

this

case.

Other

partners

associates with their firms charged at lower rates.

and

New York

counsel, Mr. Pagano, Mr. Jason L. Vincent, Ms. Roberta Miranda, Mr.
Pantino, and Mr. Alan Collier, charged at rates between $278 and
$310 per hour.

The Court finds these rates to be appropriate and

in accord with the prevailing rates in the Eastern District of
Oklahoma given the nature and complexity of the discovery and
motion practice involved in this litigation.

This litigation and

the GARA summary judgment motions presented unique and detailed
issues of fact and law that required sophisticated legal skill on
the part of all counsel.

The Court finds that the moderately

higher rates charged by New York counsel are appropriate in this
particular litigation in this district given the expertise of F&H
as national counsel for aviation products for P&WC and Sundstrand.
Agape objects to work performed by counsel for P&WC in
connection with a claims review procedure with United Technologies.
Agape contends this work is not an allowable category to be charged
against it.

The Court agrees.

No explanation is offered by P&WC

for the inclusion of time spent on what appears to be an internal
review procedure.

Absent some explanation, the Court cannot find

the tasks represented by these time entries5 are litigation-related

5

The time entries found by the Court which are related to
United Technologies claims review are contained in the time
records attached to Mr. Pagano’s affidavit, Exhibit 2 to the
Motion for Attorney Fees (Dkt. No. 298). Those entries are on
February 2, 2010 (Roberta Miranda), February 3, 2010 (Roberta
Miranda), February 5, 2010 (Pagano and Roberta Miranda), February
9, 2010 (Pagano), February 22, 2011 (Roberta Miranda), and
February 28, 2011 (Pagano and Jason L. Vincent).
8

such that they are properly chargeable against Agape.

The total

fees from these entries amount to $2,655.80 and will be deducted
from Mr. Pagano’s request for F&H fees on behalf of P&WC. Although
Agape has not directed the Court’s attention to any claims review
entries for Sundstrand, the Court’s review uncovers one entry which
appears to fall into that category.

On February 23, 2011, the F&H

time records attached to Mr. Pantino’s affidavit contain an entry
for claims review preparation by Alan Collier for .20 hours and
$62.00.

The Court will deduct this amount from Mr. Pantino’s

request for F&H fees on behalf of Sundstrand.
Agape seeks a reduction in fees based on duplication of
efforts.

In

this

regard,

Agape

points

to

numerous

entries

demonstrating review by attorneys for P&WC of GARA-related work
performed by Sundstrand and vice versa.

Agape suggests this

“review” time is not compensable given the common GARA defense
raised by P&WC and Sundstrand and their cooperative efforts in
formulating the defense in the first instance.

In essence, Agape

contends this “review” is unnecessary as it duplicates efforts
jointly undertaken by P&WC and Sundstrand.
with

Agape’s

premise

that

“review”

time

The Court disagrees
of

a

co-defendant’s

litigation filings is not compensable, but nonetheless finds a
reduction appropriate because the time records reveal that, in
numerous

instances,

attorneys.

the

“review”

was

undertaken

by

multiple

While the Court recognizes that review by counsel for

one party of another party’s filings is a properly compensable task
associated with litigation, the Court finds that the division of
labor in situations where between multiple firms represent one
client should result in no more than one attorney billing for
“review” time.

The time records submitted, however, contain

9

numerous examples of “review” by both local and national counsel.6
An itemization of this duplication is not possible given the
voluminous time records and the absence of a breakdown in certain
entries where multiple tasks are listed.

Consequently, the Court

has examined the entirety of the time records submitted and, based
upon such examination, finds that a 15% reduction on all fees is
appropriate to account for the duplication of “review” efforts by
counsel.
Based on the foregoing reasons, the Motion for Attorney Fees
(Dkt. No. 298) is granted and the following attorney fees are
awarded:
P&WC
Sidney G. Dunagan (GableGotwals - P&WC)

$81,027.75

Ralph V. Pagano (F&H - P&WC)
($151,917.83 - $2,655.80)

$149,262.03

Total before reduction

$230,289.78

15% reduction

$35,543.47

Total fee recovery

$194,746.31

6

One example of this duplication of efforts from P&WC’s
billing records can be found in Dunagan’s September 10, 2010,
entry for “review and analysis of Hamilton GARA briefing” and
F&H’s September 16, 2010, entry for “read and consider Hamilton
Sundstrand’s motion for summary judgment and supporting
exhibits.” An example from Sundstrand’s billing records can be
found in Elder’s September 9, 2010, entry for “receive and review
Motion for Summary Judgment of Pratt Whitney” and F&H’s September
8, 2010, entry for “review P&WC’s draft motion based on GARA.”
10

Sundstrand
A. Thomas Elder, Jr. (Phillips Murrah
and Smith & Rhodes - Sundstrand)

$197,425.00

Thomas A. Pantino (F&H - Sundstrand)
($108,876.83 - $62.00)

$108,814.83

Total before reduction

$306,239.83

15% reduction

$45,935.98

Total fee recovery

$260,303.85

It is so ordered this 19th day of February, 2013.

11