Waring v. Roper St Francis Physician Network et al
ORDER granting in part and denying in part 72 Motion for Attorney Fees Signed by Honorable David C Norton on March 31, 2017.(span, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF SOUTH CAROLINA
EVELINE ADAMS WARING, M.D.,
ROPER ST. FRANCIS PHYSICIAN
NETWORK; DOUGLAS BOWLING;
JOHN J. HALLETT, JR., M.D.;
CAREALLIANCE HEALTH SERVICE,
STEPHEN D. SHAPIRO, M.D., and
MOHAMMAD DAUD NAWABI, M.D.,
This matter is before the court on defendants Roper St. Francis Physicians
Network (“the Network”), CareAlliance Health Service (“CareAlliance”), Douglas
Bowling (“Bowling”), John J. Hallett, Jr., M.D. (“Hallett”), Mohammad Daud Nawabi,
M.D. (“Nawabi”), and Steven D. Shapiro, M.D’s (“Shapiro”) (collectively “defendants”)
motion for attorney’s fees. For the reasons set forth below, the court grants in part and
denies in part defendants’ motion, granting only for those fees defendants incurred
seeking arbitration after the May 29, 2015 mediation in the amount of $8,108.50 and
denying as to any fees that defendants incurred before the May 29, 2015 mediation.
Pursuant to the arbitrator’s decision, the court grants Waring fees for the wage payment
claim for the period between July 14, 2014 and October 16, 2014 and orders that the
parties bear their own costs for the arbitration proceedings.
This case arises out of an employment dispute between plaintiff Eveline Adams
Waring, M.D. (“Waring”) and defendants. In November 2013, Waring and the Network
entered into the most recent Employment Agreement (“Agreement”), which became
effective November 9, 2013 and had a one-year term. Am. Compl. ¶ 18. The Agreement
contained the following mediation and arbitration provision:
22.1 MEDIATION. Network and Physician expressly agree that
they shall seek mediation as their preferred method of handling problems,
disputes or other matters in question that may arise between them from
time to time. The mediation process may be initiated by either party by
such party providing written notice to the other party at such time when
the parties have been unable to reach a mutually agreed upon resolution to
a problem or dispute within a reasonable period of time, and at such time
as it appears that such a resolution is not likely to be attainable.
22.2 ARBITRATION. In the event that the parties are unable to
reach a mutually agreed upon resolution through mediation, then upon the
termination of the mediation process, the parties expressly agree to
participate in arbitration proceedings and to be bound by the decision of
the arbitrator. Such arbitration shall be conducted under the applicable
guidelines and rules of the American Health Lawyers Association, shall
take place in Charleston, South Carolina, and shall be concluded as
promptly as possible. Each of the parties will use all reasonable efforts to
ensure that any arbitration or mediation proceedings is completed within
sixty (60) days following notice of a request for such arbitration or
mediation. Network and Physician desire that this arbitration provision be
interpreted in accordance with the South Carolina Arbitration Act, found
at Section 15-48-1 of the South Carolina Code of Laws, as amended.
22.3 EXPENSES; ATTORNEYS’ FEES. All expenses incurred for
the services of a mediator shall be shared equally by the parties
participating in the mediation process. All expenses incurred for the
arbitration proceeding, including reasonable attorneys’ fees, shall be paid
by the party or parties so ordered in the decision of the arbitrator.
Defs.’ Mot. for Summ. J. Ex. A. On May 23, 2014, as a result of ongoing disputes with
the Network, Waring demanded mediation. Am. Compl. ¶ 64. The Network did not
respond to the demand. Id. On June 13, 2014, Waring terminated the agreement, ending
her employment with the Network and again requesting mediation. Id. ¶ 67. On July 16,
2014, Hallett and Shapiro filed a claim with the South Carolina Department of Labor,
Licensing, and Regulation (“LLR”), making allegedly false statements regarding
Waring’s conduct. Id. ¶ 70. On July 23, 2014, Waring again notified the Network that it
had “failed to respond to the demand for mediation as required by the Agreement.” Pl.’s
Resp. Ex. 1.
On or around September 2, 2014, the parties agreed to mediation on two days in
October. Waring’s case was apparently going to be mediated by David McCormack
along with a similar case filed by Dr. Karla Pou. McCormack requested that Waring’s
counsel provide a complaint to defendants in order to formulate a defense. On October 1,
2014, shortly before mediation was set to begin, Waring filed suit in the South Carolina
Court of Common Pleas against the Network, Bowling, Hallett, and Nawabi. In an email
the same day, defendants’ counsel indicated that she could not accept service and that she
would “just have to move to enforce arbitration and  seek costs against Dr. Waring.
David just wanted a Complaint drawn up so we knew what was being mediated.” Pl.’s
Resp. to Mot. to Dismiss, Ex. F. By letter dated October 3, 2014, defendants’ counsel
canceled mediation, stating that “[a]lthough we could go forward with a mediation even
with a court not yet ruling on a Motion to Dismiss or in the Alternative to Enforce
Arbitration, it would be a pointless waste of money, much better spent on aggressively
pursuing our own positions.” Defs.’ Reply to Mot. to Dismiss, Ex. H. On November 4,
2014, defendants removed the case to this court. Defendants filed a motion to dismiss, or
in the alternative, to compel arbitration that same day. The court held a hearing on
December 18, 2014 on the motion to dismiss, or alternatively, to compel arbitration. The
court also granted leave for Waring to file an amended complaint.
On December 23, 2014, Waring filed an amended complaint, alleging eight
causes of action: (1) violation of the Fair Labor Standards Act (“FLSA”); (2) retaliation
in violation of the FLSA; (3) breach of contract; (4) violation of the South Carolina
Payment of Wages Act (“SCPWA”); (5) defamation; (6) violation of the South Carolina
Unfair Trade Practices Act (“SCUTPA”); (7) abuse of process; and (8) malicious
prosecution. The amended complaint added Shapiro and CareAlliance as defendants and
added two causes of action for abuse of process and malicious prosecution. On February
12, 2015, defendants filed a motion to dismiss Waring’s defamation and SCUTPA
claims. Waring responded on March 2, 2015, and defendants filed a reply on March 12,
2015. The court held a hearing on April 14, 2015. The court instructed defendants that it
was not necessary to refile their motion to dismiss at that time. The court notified the
parties by letter dated June 4, 2015 that it was inclined to compel arbitration. ECF No.
64, Ex. 3. The parties mediated the action on May 29, 2015 before mediator Jon Austen,
in accordance with the court’s scheduling order requiring the parties to do so. ECF No.
On June 29, 2015, Waring filed a letter with the court requesting a status
conference and stating, in relevant part, that during discovery, “depositions were taken
and there is testimony indicating that after [Waring’s] employment ended[,] [d]efendants
took actions that [Waring] contend[s] were not related to her employment, and, thus, not
subject to arbitration.” ECF No. 54. Defendants filed a motion for summary judgment
on June 30, 2015. Waring responded to the motion for summary judgment on July 17,
2015, and defendants replied on July 27, 2015.
In response to Waring’s request, the court scheduled a status conference for
August 12, 2015. The court allowed Waring to file supplemental briefing to address the
issue. ECF No. 63. On August 20, 2015, the court requested that defendants file a
supplemental motion to compel arbitration that addressed the arbitration agreement’s
application to the additional defendants and additional claims added in the amended
complaint. ECF No. 64, Ex. 2. The court also instructed the parties to address the
additional issues that arose after depositions, including those that Waring referenced in
her letter to the court requesting a status conference. Id. On August 31, 2015, defendants
filed a supplemental memorandum. ECF No. 64. Waring responded on September 9,
2015. ECF No. 64. On September 30, 2015, the court issued an order compelling
arbitration, noting that Waring’s supplemental briefing was “larg[ely] a recitation of the
facts underlying each claim rather than a brief in support of their opposition to
defendants’ motion to compel arbitration.” ECF No. 69 at 8.
Defendants filed the present motion for attorney’s fees on October 14, 2015.
Defendants request $24,849.50 for work associated with the successful motion to dismiss.
In support of the reasonableness of the fees, defendants attach the affidavit of Katherine
Helms, defendants’ attorney, attesting to the time spent on the matter and the
reasonableness of the fees. Defs.’ Mot. Ex. A. Defendants also attach the billing records
of the time spent on this matter from October 14, 2014 to September 30, 2015. Id.
Waring filed a response in opposition to the motion on November 2, 2015. On
November 24, 2015, Waring filed her Arbitration Complaint. Defs.’ Supp. Mot. Ex. A.
Defendants filed an answer to Waring’s complaint on January 29, 201. Defs.’ Resp. 1.
In her Arbitration Complaint, Waring abandoned her FLSA claims, the breach of contract
claim, and her claim for violation of the South Carolina Unfair Trade Practices Act.
Waring further abandoned all claims against Nawabi. Defendants filed a supplemental
response in support of their motion on February 1, 2016.
The court stayed the attorneys’ fees matter while the parties underwent arbitration
for the underlying claims. The arbitrator issued a final decision on March 15, 2017. In
the arbitration decision, the arbitrator awarded Waring attorneys’ fees for the wage
payment claim for the period between July 14, 2014 and October 16, 2014, ordering the
Network to pay $4,000. The arbitrator also held that “[e]xcept as provided in this Order
or in the Agreement, each party shall bear its own attorneys’ fees and the costs of this
proceeding.” Defendants’ motion for attorneys’ fees in connection with their motion to
compel arbitration is now ripe for the court’s review.
Traditionally, courts require each party to bear their own costs for litigation in
accordance with the American Rule for costs and fees. Alyeska Pipeline Serv. Co. v.
Wilderness Soc’y, 421 U.S. 240 (1975). However, the general rule is subject to certain
limited exceptions. United Food and Commercial Workers v. Marval Poultry Co., Inc.
876 F.2d 346 (4th Cir. 1989). For example, in Marval Poultry, the Fourth Circuit Court
of Appeals held that a court may award attorney’s fees and costs in an action pursuant to
section 301 of the Labor Relations Management Act where a party’s position in
challenging an arbitrator’s award was “without justification.” Id. Other courts, including
courts within this circuit, have applied the “without justification” standard when a
defendant refuses to submit to arbitration. See, e.g., Service Employees Intern. Union
AFL–CIO v. Nonotuck Resource Assocs., Inc., 64 F.3d 735 (1st Cir. 1995); Food and
Commercial Workers v. West Virginia–American Water Co., 2006 WL 2822262 (S.D.W.
Va. Sept.29, 2006); Teamsters Local Union No. 505 v. Am. Ben. Corp., 2010 WL
1417808, at *2 (S.D.W. Va. Apr. 2, 2010).
Review of an Arbitrator’s Decision
It is well settled that a court’s review of an arbitration award “is among the
narrowest known to the law.” United States Postal Service v. Am. Postal Workers Union,
AFL–CIO, 204 F.3d 523, 527 (4th Cir. 2000) (internal quotation marks omitted). “A
court sits to ‘determine only whether the arbitrator did his job-not whether he did it well,
correctly, or reasonably, but simply whether he did it.’” Id. (quoting Mountaineer Gas
Co. v. Oil, Chem. & Atomic Workers Int’l Union, 76 F.3d 606, 608 (4th Cir. 1996)). “As
long as the arbitrator is even arguably construing or applying the contract and acting
within the scope of his authority, that a court is convinced he committed serious error
does not suffice to overturn his decision.” United Paper–Workers Int’l Union, AFL–CIO
v. Misco, Inc., 484 U.S. 29, 38 (1987). The Fourth Circuit has emphasized the limited
scope of judicial review because “[a] policy favoring arbitration would mean little, of
course, if arbitration were merely the prologue to prolonged litigation . . . Opening up
arbitral awards to myriad legal challenges would eventually reduce arbitral proceedings
to the status of preliminary hearings.” Remmey v. Paine–Webber, Inc., 32 F.3d 143, 146
(4th Cir. 1994). Therefore, “[a] confirmation proceeding under 9 U.S.C. § 9 is intended
to be summary: confirmation can only be denied if an award has been corrected, vacated,
or modified in accordance with the Federal Arbitration Act.” Taylor v. Nelson, 788 F.2d
220, 225 (4th Cir. 1986); see also Ottley v. Schwartzberg, 819 F.2d 373, 376 (2d Cir.
1987) (“Absent a statutory basis for modification or vacatur, the district court’s task [is]
to confirm the arbitrator’s final award as mandated by section 9 of the Act.”).
Defendants request that this court award their attorney’s fees associated with
having to enforce the arbitration clause of Waring’s employment agreement. Defs.’ Mot.
4–5. Defendants argue that Waring’s opposition to arbitration, despite the unambiguous
language of the Employment Agreement, was without justification, and that defendants
are entitled to fees as the prevailing party. Id. at 5. Defendants argue that because
Waring’s “resistance to binding arbitration was wholly without merit and unsupported by
applicable law, [d]efendants are entitled to their attorneys’ fees associated with the
successful motion to dismiss.” Id. at 6. Defendants seek the total fees associated with
defending this case before the arbitrator. Id. at 4. In response to defendants’ request for
attorney’s fees, Waring argues that defendants are not entitled to an award of fees
because they refused to mediate, which was a condition precedent to arbitration. Pl.’s
Resp. 1. Waring also argues that her legal positions in opposing the motion to dismiss
were reasonable because non-signatories to the Employment Agreement were parties to
the litigation and she believed her tort claims relating to post-employment actions were
not subject to arbitration.1 Pl.’s Resp. 5–6.
Waring also argues that since the court ordered arbitration, it is up to the
arbitrator to determine the appropriate award of attorney’s fees. Pl.’s Resp. 7. Waring
argues that “[a]ny award of fees now would be premature and usurp the authority of the
Defendants notified Waring that if she continued to pursue her claims, they would
seek their attorney’s fees and costs associated with compelling arbitration. ECF No. 9,
Ex. 6. A review of Waring’s complaint demonstrates that her arguments opposing
arbitration were attenuated, and she framed her claims to avoid arbitration—by adding
tort claims and non-signatories to the action after defendants already sought dismissal
pursuant to the arbitration clause. Waring’s Arbitration Complaint further supports
defendants’ argument that her claims were “without justification” because she abandoned
three of her claims.
The arbitration provision of the Employment Agreement states:
All expenses incurred for the services of a mediator shall be shared
equally by the parties participating in the mediation process. All expenses
incurred for the arbitration proceeding, including reasonable attorneys’
fees, shall be paid by the party or parties so ordered in the decision of the
Defs.’ Mot. for Summ. J. Ex. A (emphasis added). Thus, the arbitration agreement
between the parties does not explicitly provide for attorney’s fees under these
circumstances. However, defendants argue that the court has authority to grant its
request pursuant to its equitable powers.
Courts within this circuit have granted a party’s request for attorney’s fees when
the other party acted “without justification[,]” for example, by refusing “to submit all
matters to arbitration and delay[ing] those proceedings.” American Ben. Corp., 2010 WL
1417808 (“Defendant’s refusal to submit all matters to arbitration resulted in a delay of
proceedings for over a year, greatly hindering the primary purpose of arbitration—‘the
quick resolution of disputes and the avoidance of the expense and delay associated with
arbitrator.” Id. Since the arbitrator has now issued her final decision, the court does not
address this portion of Waring’s argument.
litigation.’” (quoting Raymond James Fin. Servs., Inc. v. Bishop, 59 F.3d 183, 190 (4th
Cir. 2010)). The Fourth Circuit first employed the “without justification” standard to
determine whether a court may award attorney’s fees pursuant to its equitable powers
when a party challenges an arbitrator’s decision in a labor dispute under section 301 of
the Labor Management Relations Act. See generally Marval Poultry Co., Inc., 876 F.2d
346. However, the Marval Poultry court did not hold that courts may award attorney’s
fees when a party is forced to pursue litigation to compel arbitration despite the clear
language of an arbitration agreement. Although defendants cite a few courts within this
circuit that have expanded the reasoning of Marval Poultry to situations more like the one
the court has before it, the principle does not appear to be widely accepted within the
Fourth Circuit. Rather, it is only applied in a few cases involving section 301 labor
disputes. See W. Virginia-Am. Water Co., 2006 WL 2822262, at *17 (“Although this
case, unlike Marval Poultry, involves a request for fees in the context of a refusal to
arbitrate, the ‘without justification’ standard articulated in Marval Poultry appears to be
applicable.”). Additionally, while the Southern District of West Virginia recognized
Marval Poultry’s applicability to motions to compel arbitration, the court concluded that
the company did not act without justification. Id. In American Benefit Corporation, also
cited by defendants, the court granted fees when the defendant refused to submit to
arbitration but failed to offer a single authority in support of its arguments and offered
only a cursory response to the plaintiff’s motion for summary judgment. Teamsters
Local Union No. 505 v. Am. Ben. Corp., 2010 WL 1417808, at *2 (S.D.W. Va. Apr. 2,
2010). Here, in contrast, Waring provided some colorable arguments in opposition to the
motion to compel and cited supporting authority.
Other courts in which courts have granted a party’s request for attorney’s fees
incurred to enforce an arbitration agreement have involved arbitration agreements that
provided that the prevailing party is entitled to costs and fees incurred to enforce the
arbitration agreement. See, e.g., Robinson v. Taboo Gentlemen’s Club, LLC, 2015 WL
3868531, at *11 (N.D.W. Va. June 23, 2015) (“In the event that any party challenges, or
is required to initiate proceedings to enforce, the arbitration [agreement], the prevailing
party to such challenges/enforcement proceedings shall be entitled to an award of all
costs, including reasonable attorney fees, incurring litigating such issues.”). The
Agreement between defendants and Waring does not include a comparable provision.
While the court finds that it does have the equitable power to grant defendants’ request
for attorney’s fees, the court notes that the authority under which defendant requests
attorney’s fees for enforcing arbitration fees is questionable.
Pursuant to its equitable power, the court awards $8,108.50, which represents the
fees incurred after the mediation on May 29, 2015.2 The Employment Agreement
required the parties to first mediate before they arbitrate. Defs.’ Mot. Summ J., Ex. A
(“In the event that the parties are unable to reach a mutually agreed upon resolution
through mediation, then upon the termination of the mediation process, the parties
expressly agree to participate in arbitration proceedings and to be bound by the decision
of the arbitrator.”). Waring made three separate requests for mediation—on May 23,
2014, June 13, 2014, and July 23, 2014. Pl.’s Resp., Ex. A. On September 23, 2014, the
parties agreed to mediate the case on October 22, 2014. However, once Waring filed the
In calculating this figure, the court tabulated all expenses that defendants
incurred after the date of May 29, 2015, as recorded in the affidavit of Katherine Dudley
Helms that was attached as an exhibit to the defendants’ motion for attorneys’ fees.
instant suit on October 1, 2014, the Network cancelled the scheduled mediation and
refused to participate. The parties did not mediate until the court instructed them to do so
in accordance with its standing order on mediation. The parties thereafter mediated on
May 29, 2015. Since mediation is a prerequisite to arbitration under the Employment
Agreement, Waring was not “without justification” in contesting the arbitration
agreement until the parties mediated in accordance with the Employment Agreement.
Further, as outlined above, defendants cancelled the scheduled mediation in October
2014. Therefore, the court denies defendants’ request for fees from October 14, 2014 to
May 29, 2015, the period before the parties engaged in mediation.
The arbitrator’s decision granted Waring attorneys’ fees for the wage payment
claim for the period between July 14, 2014 and October 16, 2014 and ordered that the
parties bear their respective costs for the remainder of the claims. Accordingly, the court
orders that each party bear their own costs for fees relating to the arbitration proceedings.
For the reasons set forth above, the court GRANTS IN PART and DENIES IN
PART defendants’ motion. It awards defendants only those fees that defendants incurred
in compelling arbitration after the May 29, 2015 mediation, in the amount of $8,108.50.
In accordance with the arbitration decision, the court grants Waring fees associated with
her wage payment claim from July 14, 2014 and October 16, 2014 and orders that the
parties bear their own cost for any fees relating to the arbitration proceedings.
AND IT IS SO ORDERED.
DAVID C. NORTON
UNITED STATES DISTRICT JUDGE
March 31, 2017
Charleston, South Carolina
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