Cotner v. Buffaloe & Associates, PLC
Filing
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MEMORANDUM AND OPINION as set forth in following order.Signed by District Judge R Leon Jordan on 5/14/12. (ABF)
IN THE UNITED STATES DISTRICT COURT FOR
THE EASTERN DISTRICT OF TENNESSEE
KNOXVILLE DIVISION
MELODY H. COTNER,
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Plaintiff,
v.
BUFFALOE & ASSOCIATES, PLC,
Defendant.
No. 3:11-CV-299
MEMORANDUM OPINION
This Fair Debt Collection Practices Act (“FDCPA”) case is before the court
on plaintiff’s motion for costs and attorney fees [doc. 19]. Defendant has responded in
partial opposition [doc. 21], and plaintiff has submitted a reply [doc. 25]. For the reasons
that follow, plaintiff’s motion will be granted in part.
I.
Background
Plaintiff filed her complaint on June 28, 2011, alleging multiple violations of
the FDCPA stemming from a single collection letter sent to her by defendant. On August 19,
2011, defendant filed a motion to dismiss. In response, plaintiff filed an amended complaint
which was answered by the defendant on October 13, 2011. The court conducted a
telephonic scheduling conference on December 5, 2011.
Two days later, defendant served an offer of judgment pursuant to Federal Rule
of Civil Procedure 68. On December 27, 2011, plaintiff filed a notice of acceptance of the
offer of judgment. In material part, defendant’s offer was
to pay a total of $1,001.00 plus reasonable costs, including attorney’s fees, in
connection with Plaintiff’s claims under the FDCPA and said fees and costs
are to be in an amount as agreed to between the parties or, if they are unable
to agree, as determined by the Court upon motion.
The parties were unable to agree on reasonable costs and attorney fees, and plaintiff filed the
instant motion on January 27, 2012.
II
Relevant Authority
The FDCPA provides in material part that “any debt collector who fails to
comply with any provision of this subchapter with respect to any person is liable [for] . . . the
costs of the action, together with a reasonable attorney’s fee as determined by the court.” 15
U.S.C. § 1692k(a)(3). “[T]he fee applicant bears the burden of establishing entitlement to
an award and documenting the appropriate hours expended and hourly rates.” Hensley v.
Eckerhart, 461 U.S. 424, 437 (1983).
In determining what fee is reasonable, the court must begin its analysis with
what is termed the “lodestar” - reasonable hours multiplied by a reasonable rate. “The most
useful starting point for determining the amount of a reasonable fee is the number of hours
reasonably expended on the litigation multiplied by a reasonable hourly rate.” Id. at 433.
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“The amount of the fee, of course, must be determined on the facts of each
case.” Id. at 429. The Hensley Court identified 12 factors relevant both to the determination
of the lodestar and to any subsequent upward or downward adjustments that might be
necessary. Id. at 430 n.3, 434 n.9. Those factors are:
(1) the time and labor required; (2) the novelty and difficulty of the questions;
(3) the skill requisite to perform the legal service properly; (4) the preclusion
of employment by the attorney due to acceptance of the case; (5) the customary
fee; (6) whether the fee is fixed or contingent; (7) time limitations imposed by
the client or the circumstances; (8) the amount involved and the results
obtained; (9) the experience, reputation, and ability of the attorneys; (10) the
“undesirability” of the case; (11) the nature and length of the professional
relationship with the client; and (12) awards in similar cases.
Id. at 430 n.3.
“A request for attorney’s fees should not result in a second major litigation.”
Id. at 437. In Coulter v. Tennessee, the Sixth Circuit Court of Appeals discussed the
Congressional intent underlying more than 130 attorney fee-shifting statutes, including the
FDCPA. 805 F.2d 146, 148-49 n.2, 153 (6th Cir. 1986).
Congress intended to provide an economic incentive for the legal profession
to try meritorious cases defining and enforcing statutory policies and
constitutional rights in a variety of fields of legal practice. Congress did not
intend that lawyers, already a relatively well off professional class, receive
excess compensation or incentives beyond the amount necessary to cause
competent legal work to be performed in these fields. Legislative history
speaks of “fees which are adequate to attract competent counsel, but which do
not produce windfalls,” . . . and cautions against allowing the statute to be used
as a “relief fund for lawyers” . . . .
Id. at 148-49 (citations omitted). In other words, courts should be mindful of cases in which
attorney fees are “the engine . . . powering the case,” Carroll v. United Compucred
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Collections, No. 1:99-00152, 2008 WL 3001595, at *4 n.4 (M.D. Tenn. July 31, 2008), and
“the fee petition tail should not be allowed to wag the dog.” Career Agents Network v.
careeragentsnetwork.biz, 722 F. Supp. 2d 814, 825 (E.D. Mich. 2010).
Further, “hourly rates for fee awards should not exceed the market rates
necessary to encourage competent lawyers to undertake the representation in question.”
Coulter, 805 F.2d at 149. The relevant market is the venue in which the court sits. See
Adcock-Ladd v. Sec’y of Treasury, 227 F.3d 343, 350 (6th Cir. 2000).
III.
Attorney Fees
Based on an desired hourly rate of $275.00, plaintiff seeks attorney fees in the
amount of $7,232.50, along with $356.43 in costs. Plaintiff’s counsel has submitted a billing
statement which lists 16.3 hours through the date of acceptance of the offer of judgment, and
5.5 subsequent hours in pursuit of attorney fees. The billing statement goes only through
January 26, 2012, and clearly does not document all hours expended in the fee litigation. No
paralegal or legal assistant work is shown. The court will now consider plaintiff’s fee
request in light of the 12 Hensley factors.
A. Time and Labor Required
The court first notes that this case settled relatively early. Plaintiff’s attorney
lists a more than eight hours for preparing the initial complaint, reviewing the motion to
dismiss, and preparing the amended complaint. It would appear that the initial complaint was
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in some ways deficient, as it was met with a motion to dismiss which in turn brought about
the amended complaint. On the facts of the present case, it would be unreasonable and
excessive to require the defendant to pay for more than eight hours of attorney time for the
above-cited filings. The court will accordingly reduce by two the hours billed through the
date of acceptance of the offer of judgment, from 16.3 down to 14.3.
Next, the court is concerned that it appears from plaintiff’s billing statement
that no work was done on this case by support staff. The three most troubling billing entries
by the attorney are as follows: “Drafted Client Contact and Intake Info” (0.5 hours);
“Summons and Complaint to be sent by Certified Mail, Certified Mail Docs” (0.3 hours); and
“Reviewed Certified Mail return, scanned to file” (0.1 hours).
The record indicates that plaintiff’s counsel is a solo practitioner, but the court
has no information regarding the size of his support staff. The court cannot imagine that
plaintiff’s counsel has no staff whatsoever. Regardless, the three billing entries cited
immediately above are purely administrative tasks. It would be unreasonable to bill the
defendant at attorney rates for the performance of that work. Plaintiff has not documented
any support staff billing in this case (or explained the absence thereof), and it is her burden
to document “the appropriate hours expended and hourly rates.” Hensley, 461 U.S. at 437.
“Where the documentation of hours is inadequate, the district court may reduce the award
accordingly.” Id. at 433. The 0.9 hours billed at attorney rates for the obvious performance
of administrative tasks will be stricken entirely, further reducing the hours billed through the
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date of acceptance of the offer of judgment from 14.3 down to 13.4.
Other billing entries in this case appear to be a hybrid of lawyer and
administrative work. Those entries will be discussed further below.
B. Novelty and Difficulty of the Questions Presented
The court again notes that this case settled relatively early. As such, it is
impossible for the court to know whether novel and/or difficult issues were presented. This
factor therefore does not weigh in favor of either party.1
C. Skill Required to Perform the Legal Service Properly
The court recognizes that the FDCPA is a specialized area of the law.
Conversely, the court again notes that the offer of judgment was served a mere two days after
the scheduling conference, meaning that the case never reached any complicated stage of
litigation. The court finds that the “skill required” factor does not significantly weigh in
favor of either party.
D. Preclusion of Employment by the Attorney Due to Acceptance of This Case
Plaintiff’s counsel makes no argument that other clients were turned away due
to the acceptance of this case. The court finds that the “preclusion” factor has no bearing on
this matter.
1
As noted above, defendant filed a motion to dismiss. However, because plaintiff’s
amended complaint mooted that motion [doc. 11], the court was not required to conduct any analysis
of the issues contained therein.
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E. The Customary Fee
Again, the “customary fee” must be based on the market in which the court sits.
See Adcock-Ladd, 227 F.3d at 350. Plaintiff’s counsel states that he charges a fixed rate of
$225.00 per hour and that his contingency fee rates have recently increased from $275.00 per
hour (2011) to $325.00 per hour (2012). He claims that in 2010 he received an FDCPA fee
award based on a rate of $250.00 per hour. He also cites the court to a 2009 ERISA case
from the Chattanooga division in which the court found reasonable an undisputed hourly rate
of $250.00 (in favor of a lawyer not involved in the present case). See McKay v. Reliance
Standard Life Ins., 654 F. Supp. 2d 731, 739-40 (E.D. Tenn. 2009).
F. Fixed or Contingent Fee
Counsel’s representation of plaintiff in this case is on a contingency fee basis.
As such, his compensation will come from the amount determined by the court.
G. Time Limits Imposed by the Client or the Circumstances
Plaintiff’s counsel makes no argument that unusual time limitations were
imposed by his client or by the circumstances of this case. The court finds that the “time
limits” factor has no bearing on this matter.
H. The Amount Involved and the Results Obtained
Plaintiff prevailed on her claim against the defendant. She points out that she
settled the case for $1.00 more than the statutory damage cap.
1692k(a)(2)(A).
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See 15 U.S.C. §
The Hensley Court made clear that the degree of success achieved is “the most
critical factor.” Hensley, 461 U.S. at 436. However, attorney fees should not be limited by
the relatively minor sum ($1,001.00) recovered by the plaintiff. See Purtle v. Eldridge Auto
Sales, 91 F.3d 797, 802 (6th Cir. 1996).
I. Experience, Reputation, and Ability of the Attorney
Plaintiff’s counsel has practiced consumer bankruptcy law for almost 20 years.
According to his declaration, he has favorably settled at least 140 FDCPA cases. Defendant
does not contest that plaintiff is represented by an experienced and competent FDCPA
practitioner. This factor therefore weighs somewhat in plaintiff’s favor.
J. Undesirability of the Case
To the extent that plaintiff’s counsel would argue that FDCPA cases are
“undesirable,” the court notes a dramatic increase in the number of FDCPA filings on its
docket in the last year. The court further notes the attachments to defendant’s response brief.
Those attachment are advertisements for the “FDCPA Boot Camp,” a weekend seminar for
which plaintiff’s attorney provides a testimonial. [Doc. 21, ex. 2].
According to the advertisement, the FDCPA Boot Camp is designed “to make
your existing FDCPA practice shine. The boot camp is centered on two simple, [sic]
concepts: Every collection account is destined to become an FDCPA claim; and, every
FDCPA claim is destined to become a better FDCPA claim.” [Doc. 21, ex. 1] (emphasis in
original). One attendee reports that the boot camp had “already paid for itself several times
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over in fees earned.” [Doc. 21, ex. 2]. Based on the above, the court cannot conclude that
FDCPA cases are “undesirable.”
K. Nature and Length of the Professional Relationship with the Client
Nothing in the record indicates that the professional relationship with plaintiff
was extraordinarily lengthy or involved. This factor has no bearing herein.
L. Awards in Similar Cases
“Rates from prior cases can . . . provide some inferential evidence of what a
market rate is . . . but themselves do not set the rate.” B&G Mining v. Dir., Office of
Workers’ Comp. Programs, 522 F.3d 657, 664 (6th Cir. 2008). As noted above, plaintiff’s
counsel claims to have been awarded an FDCPA fee in 2010 based on a rate of $250.00 per
hour, and he also cites a 2009 ERISA case from the Chattanooga division in which the court
approved an uncontested hourly rate of $250.00 for an attorney other than him. See McKay,
654 F. Supp. at 739-40. Neither party, however, directs the court’s attention to any recent
case in which an FDCPA lodestar has been litigated in this district, and the court’s research
has uncovered none.
For comparison purposes, the court’s research reveals the following recent fee
cases in this district, none of which involve a disputed FDCPA hourly rate:
1. Williams v. Portfolio Recovery Assocs., No. 1:11-CV-156, an FDCPA case
from the Chattanooga division in which the parties agreed (in early 2012) to
fee rates of $192.00 per hour for associates and $270.00 per hour for partners
(in a case not involving the present attorney).
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2. Hance v. Norfolk S. Ry., 3:04-CV-160, 2007 WL 3046355, at *3 (E.D. Tenn.
Oct. 16, 2007), a civil rights case from the Knoxville division in which Judge
Phillips and Magistrate Judge Guyton determined that a rate of $250.00 per
hour was reasonable on the facts of that case.
3. Doherty v. Maryville, No. 3:07-CV-157, slip op. at 13 (E.D. Tenn. Sept. 30,
2009), a civil rights case from the Knoxville division in which Judge Varlan
determined that rates of $175.00 per hour for associates and $225.00 per hour
for partners were reasonable.
4. Brooks v. Invista, 528 F. Supp. 2d 785, 790 (E.D. Tenn. 2007), a civil rights
case from the Chattanooga division in which Chief Judge Collier determined
that an hourly rate of $239.50 was reasonable “in [that] type of case.”
Due to the paucity of authority regarding local FDCPA fee litigation, most of
the cases cited herein have been ERISA or civil rights matters. It is the court’s experience
that FDCPA cases are not as complex or as conceptually difficult as those brought under
ERISA or the civil rights laws. See, e.g., Hensley, 461 U.S. at 436 (“[C]omplex civil rights
litigation involv[es] numerous challenges to institutional practices or conditions. This type
of litigation is lengthy and demands many hours of lawyers’ services.”).
The court simply cannot conclude that FDCPA fee rates should be as high as
rates approved in ERISA or civil rights cases. Based on the limited evidence and authority
presented in this case, and having considered the twelve factors set forth in Hensley, the court
concludes that an hourly attorney fee range of $175.00 to $225.00 is appropriate.
M. Conclusion
In determining the reasonable rate to be awarded in this case, the court has
again considered the 12 Hensley factors as discussed above. On the facts of this particular
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case, the most striking issue is the apparent billing at “lawyer rates” for tasks that are
administrative in nature.
The court has already deleted 0.9 hours of sought-after attorney fees for the
performance of work that plaintiff’s billing statement shows to have been clearly
administrative.
The court now further observes that the line between lawyer and
administrative tasks is less clear in other entries on plaintiff’s billing statement. As but one
example, for December 5, 2011, plaintiff seeks $275.00 per hour attorney fees not only for
the “lawyer task” of participating in the scheduling conference but also for the administrative
work of entering dates on a calendar.
It is not the court’s intention to dismiss or ignore the realities of the solo
practitioner. Nonetheless, it is unreasonable to expect an opposing party to pay top-of-themarket attorney rates for work that is all or part administrative. Considering the time entries
discussed herein, the court is not confident that counsel’s other entries do not also have an
undue administrative component. Again, it is plaintiff’s burden to document “the appropriate
hours expended and hourly rates,” Hensley, 461 U.S. at 437, and she has not done so in this
case. “Where the documentation of hours is inadequate, the district court may reduce the
award accordingly.” Id. at 433.
For all the reasons discussed herein, the court concludes that $175.00 per hour
is a reasonable rate for the attorney work done in this case. That rate will be multiplied by
the reasonable number of hours billed through the date of acceptance of the offer of
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judgment, which is 13.4. Accordingly, plaintiff will be awarded $2,345.00 in attorney fees
through the date of the acceptance of the offer of judgment.
IV.
“Fees for Fees”
When parties litigate the issue of attorney fees, the additional fees generated
by that litigation are termed “fees for fees.” See, e.g., Lamar Adver. Co. v. Charter Twp. of
Van Buren, 178 F. App’x 498, 502 (6th Cir. 2006). Fees for fees are recoverable, but not
without limitation. See Coulter v. Tenn., 805 F.2d 146, 151 (6th Cir. 1986). In Coulter, the
Sixth Circuit provided the following “guidelines and limitations”:
In the absence of unusual circumstances, the hours allowed for preparing and
litigating the attorney fee case should not exceed 3% of the hours in the main
case when the issue is submitted on the papers without a trial and should not
exceed 5% of the hours in the main case when a trial is necessary. Such
guidelines and limitations are necessary to insure that the compensation from
the attorney fee case will not be out of proportion to the main case and
encourage protracted litigation.
Id.
Inexplicably, neither party in this case cited the court to the binding authority
of Coulter. Defendant has instead cited Young v. Diversified Consultants, 554 F. Supp. 2d
954 (D. Minn. 2008), for the proposition that fees on fees are not available. Young is wholly
distinguishable. In Young, the offer of judgment was expressly limited to fees and costs
incurred “through the date of Plaintiff’s counsel’s receipt of service of this Offer.” Id. at
957. No such restriction is present in the offer of judgment in this case.
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Returning to Coulter, “unusual circumstances” warranting a departure from the
Sixth Circuit’s binding “guidelines and limitations” are found, for example, where a case
involves otherwise noncompensable work at the administrative level, or where fee litigation
is protracted by the opposing party’s “insincere” tactics. See Moore v. Crestwood Local Sch.
Dist., 804 F. Supp. 960, 969-70 (N.D. Ohio 1992). The court finds no unusual circumstances
present in this case.2 The court concludes that plaintiff is entitled to “fees for fees” in the
amount of $70.35 ($175.00 hourly rate, multiplied by 13.4 hours in the main case, multiplied
by 3%).
V.
Costs
Plaintiff seeks $356.43 in costs. Of that amount, $350.00 is the filing fee paid
to this court, and $6.43 is the cost of service of the complaint.
Defendant concedes that plaintiff is entitled to her filing fee, but contests
reimbursement of the cost of service. Defendant, however, offers no argumentation on that
point. The issue is according waived, and plaintiff will be awarded the full amount of costs
requested.
2
If anything, the court considered a downward adjustment for plaintiff’s failure to
acknowledge Coulter.
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VI.
Conclusion
For the reasons provided herein, plaintiff’s motion for attorney fees and costs
[doc. 19] is GRANTED IN PART. Plaintiff will be awarded reasonable attorney fees in the
amount of $2,415.35, and costs in the amount of $356.43. An order consistent with this
opinion will be entered.
ENTER:
s/ Leon Jordan
United States District Judge
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