Eagle Supply and Manufacturing, L.P. v. Bechtel Jacobs Company, LLC

Filing 261

MEMORANDUM AND ORDER: the court ACCEPTS IN WHOLE the Report and Recommendation under 28 U.S.C. § 636(b)(1) and Fed.R.Civ.P. 72(b). It is ORDERED, for the reasons stated in the Report and Recommendation, which the court adopts a nd incorporates into its ruling, that Eagle's motion for attorney's fees, costs, and Prompt Pay Act interest [R. 208] is GRANTED in part and DENIED in part as follows: (1) 227 hours shall be deducted from the original attorney fee request; (2) paralegal hourly rates shall be reduced to $125 per hour; and (3) other staff and litigation support rates shall be reduced to $75 per hour. Eagle's supplemental motion for appellate attorney's fees [R. 240] is GRANTED. Eagle 's motion for leave to file a second supplemental motion for attorney's fees and costs [R. 253] is DENIED. Eagle is DIRECTED to submit a proposed judgment in accordance with Judge Poplin's recommendations within thirty (30) days. Signed by District Judge Pamela L Reeves on September 18, 2018. (AYB)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF TENNESSEE
AT KNOXVILLE

EAGLE SUPPLY AND
MANUFACTURING, L.P.,
Plaintiff,
v.
BECHTEL JACOBS COMPANY, LLC,
Defendant.

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No.: 3:10-CV-00407
REEVES/STEGER

MEMORANDUM AND ORDER

On August 8, 2018, the Honorable Debra C. Poplin, United States Magistrate Judge,
filed a 37-page Report and Recommendation (R&R) [R. 258], in which she recommended
that Eagle’s motion for attorney’s fees, costs, and Prompt Pay Act interest [R. 208] be
granted in part and denied in part. Judge Poplin recommended that (1) 227 hours be
deducted from the original attorney fee request; (2) paralegal hourly rates be reduced to
$125 per hour; and (3) other staff and litigation support rates be reduced to $75 per hour.
Judge Poplin also recommended that Eagle’s supplemental motion for appellate attorney’s
fees [R. 240] be granted, and Eagle’s motion for leave to file a second supplemental motion
for attorney’s fees and costs [R. 253] be denied.

Eagle did not file any objections to the R&R, and enough time has passed since the
filing of the R&R to treat any objections as having been waived. See 28 U.S.C. § 636(b)(1);
Fed.R.Civ.P. 72(b).1
Bechtel Jacobs Company (BJC), however, did file several objections [R. 259] to the
R&R. As required by 28 U.S.C. § 36(b)(1) and Rule 72(b), Fed.R.Civ.P., the court has
now undertaken a de novo review of those portions of the R&R to which BJC objects. For
the reasons that follow, the court finds BJC’s objections without merit and the objections
will be overruled.
Objection No. 1
BJC argues that the Judge Poplin inconsistently applied federal and state law in
recommending that Eagle be awarded attorney’s fees. This objection is without merit.
Judge Poplin began her analysis by noting that Eagle was entitled to attorney’s fees
in this case pursuant to the Tennessee Prompt Pay Act (TPPA). Judge Poplin then
addressed the factors under Tennessee Rule of Professional Conduct 1.5. Judge Poplin
went through each of the factors in Rule 1.5 before finding that the balance of factors
weighed in favor of allowing Eagle attorney’s fees, with some specific deductions. See R.
258 at 11-23. Contrary to BJC’s argument, the Magistrate Judge relied upon Tennessee
law in determining the amount of attorney’s fees. Specifically, Rule 1.5(a)(4) requires a
court to consider “the amount involved and the results obtained.” Judge Poplin found that

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In its response to BJC’s objections, Eagle ask the court to accept the Magistrate Judge’s R&R in full [R. 260].

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Eagle recovered on all of its claims, except a claim for $13,000. It is clear that Judge Poplin
considered Tennessee law, and the objection is overruled.
Objection No. 2
BJC next argues that Judge Poplin gave more weight to the affidavits from Eagle
while ignoring the affidavits from BJC. Specifically, BJC objects to Judge Poplin’s
consideration of the affidavit of Brian Corgan.
Eagle responds that Corgan was the senior partner overseeing this litigation and the
attorney who argued the Sixth Circuit Appeal. Therefore, there is no question that Corgan
is familiar with the litigation and qualified to support Eagle’s fee request. The court agrees.
Judge Poplin reviewed the audio recording of oral argument before Magistrate
Judge Shirley on the earlier fee motion. Thus, she had the benefit of oral argument along
with the parties’ affidavits. Considering the R&R as a whole, the court does not find that
Judge Poplin improperly weighed the competing affidavits/arguments of counsel. The
objection is overruled.
Objections No. 3 & 4
BJC argues the R&R allows attorney rates that are excessive and not reasonable,
citing its own counsel’s rates in this matter.
Eagle responds that Judge Poplin cited nine cases from Tennessee that set out
examples of local rates. See R. 258 at 14-22. After doing so, Judge Poplin devoted over
eight pages to analyzing the locality factor and explaining why Eagle was entitled to its
requested rates.

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In the R&R, Judge Poplin found that given counsel’s professional background, years
of experience, contribution to the case, and the requisite skill necessary to conduct the
complex trial, post-trial motions, and appeal, Eagle’s requested rates reasonably reflected
the value of services provided. She noted that the case raised novel issues of construction
and federal procurement law including differing site conditions, adequacy of notice,
responsibility for project delays, adequacy of BJC’s bid document, and the appropriate
calculation of damages. The court finds no error and the objection is overruled.
Objection No. 5
Next, BJC nitpicks Judge Poplin’s statement that this litigation raised “novel” issues
of construction and federal procurement law. It is clear from Judge Poplin’s thorough
analysis of the issues that she was referring to the complex nature of the case. BJC hired
Eagle to demolish, decontaminate, and transport debris of 40 facilities at the Department
of Energy’s East Tennessee Technology Park. Specifically, Judge Poplin noted (1) Eagle’s
success in proving its reconstructed bid estimate for K-1004-L; (2) Eagle’s success in
proving the Waste Remediation REA; and (3) Eagle’s success in proving that BJC acted in
bad faith throughout the contract. The undersigned presided over the trial of this case, and
recalls the complexity of the issues regarding the REAs and finds no error in Judge Poplin’s
findings. BJC’s argument is without merit and the objection is overruled.
Objection No. 6
BJC argues that Judge Poplin erred in finding the hourly rate for Ian Goldrich
reasonable because she used a blended rate for Goldrich.

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The record shows that in the seven years identified, Goldrich charged his highest
rate of $415.00 per hour in only one year. In the other six years, Goldrich charged lower
rates of $350.00; $361.15; $351.93 and $310.00. From 2015 through the present, Goldrich
billed at only $310 per hour. Judge Poplin utilized a blended rate for Goldrich, and the
court agrees that this was proper. The objection is overruled.
Objection No. 7
BJC argues the R&R compares the rates of John Jett and Lochlin Samples in an
incorrect manner. The R&R notes that the rates charged by Jett, a 2008 graduate, were
$225 an hour while those of Samples, a 2011 graduate, were $235 an hour. BJC asserts
this omits the relative experience levels of counsel at the time the amounts were billed.
When properly analyzed, BJC states, the comparison shows that Eagle’s counsel’s rates
were significantly higher.
Quite frankly, this is another example of BJC’s nitpicking inconsequential issues.
The court finds no error in Judge Poplin’s analysis of the rates charged by Eagle’s counsel.
Judge Poplin considered the attorneys’ professional background, contribution to the case,
and the requisite skill necessary to conduct this complex litigation. The objection is
overruled.
Objection No. 8
Next, BJC argues the R&R erred in allowing fees for the False Claims Act
investigation. This objection is without merit.
In the R&R, Judge Poplin found that a reduction in fees related to the False Claims
investigation was not warranted. She found that the False Claims investigation was
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inextricably linked to the underlying allegations in the litigation. Judge Poplin noted the
“unwarranted investigation delayed Eagle’s efforts to secure payment for extra work
performed on the project.” The False Claims investigation was just another example of a
BJC tactic to delay paying Eagle what it was owed under the parties’ contract, and thus,
attorney’s fees are warranted under the TPPA. The objection is overruled.
Objection No. 9
BJC argues Judge Poplin erred in allowing costs for administrative work by case
managers and legal assistants. BJC asserts that administrative work is not recoverable.
First, BJC is confusing clerical work with administrative work. Second, the court
finds this was a document intensive case that required the support of case assistants and
litigation support. Judge Poplin reduced the hourly rates to $125 per hour for paralegals
and to $75 per hour for case assistants and litigation support. The court finds this
reasonable and the objection is overruled.
Objection No. 10
BJC argues the R&R made no reductions to hours worked by Eagle’s counsel.
Specifically, BJC states Judge Poplin erred by “not considering the inefficiencies cause by
having more than a dozen attorneys and thirty individuals working on the matter.”
The court recalls BJC making an “inefficiency” argument concerning Eagle’s
performance of its work at the Oak Ridge site. The court rejected that argument at trial
and this objection fares no better. Judge Poplin reviewed not only the briefs filed by both
parties, but the billing records for Eagle’s counsel. Judge Poplin considered the fact that
the case was not fully adjudicated until seven years after it began and involved a trial
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concerning a four-year long project. BJC has not shown any “inefficiencies” in the manner
in which Eagle’s counsel conducted this litigation. The objection is without merit and it is
overruled.
Objection No. 11
BJC next argues that Judge Poplin erred by not giving controlling weight to its
argument that the court should apply universal reductions to Eagle’s requested fees. The
objection is without merit.
BJC ignores Judge Poplin’s analysis that considered the length of the litigation
(seven years); that the litigation involved complex issues related to nuclear waste
remediation; and that Eagle was successful on all its claims with the exception of one claim
for $13,000. A review of the record shows that Judge Poplin correctly determined that no
universal reduction in fees was warranted. The objection is overruled.
Objection No. 12
BJC further argues that Judge Poplin erred by not reducing the hours and rates Eagle
requests for preparing its fee application.
BJC’s objection is without merit. Judge Poplin found that “while the hours spent
on litigating fees seems excessive, the court observes that plaintiff’s fee request has been
heavily litigated.” [R. 258 at 30]. Unfortunately, that has been the nature of this litigation.
Every conceivable issue was heavily litigated, mostly by BJC. The undersigned recalls
that BJC protracted this litigation at every possible turn, even acting in bad faith by
instituting a False Claim investigation against Eagle. The court finds no error in Judge
Poplin’s analysis, and the objection is overruled.
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Objection No. 13
Lastly, BJC objects to allowing Eagle its fees for appellate work. BJC argues that
because Eagle did not state its intent to recover its fees on appeal, it waived its right to
recover fees on appeal.
Eagle maintains that the court must apply the TPPA for the substantive component
of the analysis and Federal Rule of Civil Procedure 54 for the procedural component of the
analysis. Eagle asserts Tennessee law addressed entitlement to attorney’s fees and Rule 54
addresses how to perfect the right to recover those fees. Thus, Eagle was not required to
request its attorney’s fees in its appellate brief. Eagle has the better argument.
Judge Poplin noted that the TPPA does not expressly award attorney’s fees incurred
on appeal, but provides that reasonable attorney’s fees may be awarded upon a finding of
“bad faith.” The undersigned made such a finding of “bad faith” on the part of BJC in this
case. Moreover, the court agrees with Judge Poplin’s analysis and determination that the
question of whether Eagle is entitled to attorney’s fees under the TPPA is substantive, but
when Eagle must request attorney’s fees is procedural. The court finds no error and the
objection is overruled.
Conclusion
After a careful review of the record, the Court is in complete agreement with the
Magistrate Judge’s recommendations. Accordingly, the court ACCEPTS IN WHOLE
the Report and Recommendation under 28 U.S.C. § 636(b)(1) and Fed.R.Civ.P. 72(b). It
is ORDERED, for the reasons stated in the Report and Recommendation, which the court
adopts and incorporates into its ruling, that Eagle’s motion for attorney’s fees, costs, and
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Prompt Pay Act interest [R. 208] is GRANTED in part and DENIED in part as follows:
(1) 227 hours shall be deducted from the original attorney fee request; (2) paralegal hourly
rates shall be reduced to $125 per hour; and (3) other staff and litigation support rates shall
be reduced to $75 per hour.
Eagle’s supplemental motion for appellate attorney’s fees [R. 240] is GRANTED.
Eagle’s motion for leave to file a second supplemental motion for attorney’s fees
and costs [R. 253] is DENIED.
Eagle is DIRECTED to submit a proposed judgment in accordance with Judge
Poplin’s recommendations within thirty (30) days.
Enter:
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UNITED STATES DISTRICT
UNITED STATES DISTRICT JUDGE
A S S
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