McNeill v. Geostar et al
Filing
85
MEMORANDUM DECISION and Order granting 82 Motion for Award of Costs and Attorney Fees. Signed by Judge Ted Stewart on 12/13/12. (ss)
IN THE UNITED STATES COURT FOR THE DISTRICT OF UTAH
CENTRAL DIVISION
LARRY McNEILL,
Plaintiff,
MEMORANDUM DECISION AND
ORDER GRANTING PLAINTIFF’S
MOTION FOR AWARD OF COSTS
AND ATTORNEY FEES.
vs.
GEOSTAR CORPORATION; FIRST
SOURCE WYOMING, INC.; GASTAR
EXPLORATION LIMITED,
Case No. 2:06-CV-911 TS
Defendants.
This matter is before the Court on Plaintiff’s Motion for Award of Costs and Attorney
Fees. For the reasons stated below, the Court will grant Plaintiff’s Motion.
I. BACKGROUND
On October 25, 2006, Plaintiff filed his Complaint in this case. This case was then
transferred to the Honorable Joseph M. Hood of the Eastern District of Kentucky for inclusion in
ongoing multidistrict litigation on February 14, 2008. On April 11, 2012, Judge Hood granted in
part and denied in part Plaintiff’s motion for partial summary judgment, finding that Defendants
Geostar Corporation (“Geostar”) and First Source Wyoming, Inc. (“First Source”) breached the
1
contract at issue in this case and that Defendants’ counterclaims were without merit. On April
26, 2012, this case was returned to this Court for further proceedings.
On June 13, 2012, Plaintiff filed its Motion for Entry of Judgment. On August 8, 2012,
counsel for Defendants Geostar and First Source filed a Motion to Withdraw. At that time,
Defendants were informed that a response to an outstanding Motion for Entry of Judgment was
due, that Defendants must file a notice of appearance of counsel within twenty-one days of
counsel’s withdrawal, and that if such a notice was not filed, Defendants would be subject to
default.1 Counsel was allowed to withdraw on August 13, 2012. On September 27, 2012,
because Defendants had not yet filed a notice of appearance of counsel, the Court gave
Defendants fourteen days to show cause why they had failed to file a notice of appearance.2
On October 25, 2012, as Defendants had not filed a notice of appearance of counsel or
responded to Plaintiff’s Motion for Entry of Judgment, the Court issued a memorandum decision
and order granting Plaintiff’s Motion for Entry of Judgment.3 In that order, the Court found that
Defendants’ actions were highly prejudicial to the Plaintiff, that Defendants interfered with the
judicial process, that Defendants were highly culpable, and that judgment was appropriate as a
sanction.4
Docket No. 76 Ex. 1.
1
2
Docket No. 78.
3
Docket No. 80.
Id. at 2-3.
4
2
On November 8, 2012, Plaintiff filed the Motion for Attorney Fees and Costs under
consideration here. Plaintiff has requested an award of $211,408.75 in attorney fees and $762.40
in taxable costs. Defendants have not opposed Plaintiff’s Motion.
II. DISCUSSION
A.
MOTION FOR ATTORNEY FEES
Plaintiff argues that it should be awarded attorney fees and costs incurred in this suit
pursuant to Utah Code Ann. § 78B-5-825.
In a case brought to this Court on diversity, the matter of attorney fees is a substantive
legal issue and is therefore controlled by state law.5 Section 78B-5-825 states that reasonable
attorney fees shall be awarded “to a prevailing party if the court determines that the action or
defense to the action was without merit and not brought or asserted in good faith.”6 In order to
be awarded attorney fees under § 78B-5-825: (1) the moving party must prevail, (2) the claim
asserted by the non-moving party must be without merit, and (3) the claim must not be brought in
good faith.7
In support of its motion, the moving party must marshal sufficient evidence for the Court
to find each of the three requirements is met.8 A claim is brought in good faith, for purposes of §
78B-5-825, if the party bringing the claim has: “‘(1) an honest belief in the propriety of the
See Cowley v. Porter, 127 P.3d 1224, 1235 (Utah Ct. App. 2005) (quoting In re
Discipline of Sonnenreich, 86 P.3d 712, 725 (Utah 2004)).
5
UTAH CODE ANN. § 78B-5-825.
6
Hermes Assoc. v. Park’s Sportsman, 813 P.2d 1221, 1225 (Utah Ct. App. 1991).
7
Still Standing Stable, LLC v. Allen, 122 P.3d 556, 559 n.2 (Utah 2005).
8
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activities in question; (2) no intent to take unconscionable advantage of others; and (3) no intent
to, or knowledge of the fact that the activities in question hinder, delay, or defraud others.’”9
“‘To establish a lack of good faith, or bad faith . . . a party must prove that one or more of these
factors is lacking.’”10
Plaintiff meets the first prong of the § 78B-5-825 test, as he was the prevailing party in
this case.11 In addition, Plaintiff has shown that Defendants’ claims were without merit.12 In his
April 11, 2012 order, Judge Hood explicitly found that Defendants’ defense to Plaintiff’s breach
of contract claim was without merit. Additionally, Judge Hood found that Defendants’
counterclaims were puzzling, that Defendants failed to present any evidence raising a genuine
issue for trial, and that Defendants failed to even respond to Plaintiff’s motion for summary
judgment with respect to those claims.13
Finally, Plaintiff has established that Defendants’ claims were not brought in good faith,
as Defendants brought claims with a knowledge or intent to hinder or delay the resolution of
Plaintiff’s claims. After allowing litigation to proceed for nearly four years, Defendants failed to
even make arguments supporting their claims on a motion for summary judgment.14 In addition,
Id. at 560 (quoting In re Discipline of Sonnenreich, 86 P.3d 712, 726 (Utah 2004)).
9
10
Id. (quoting Sonnenreich, 86 P.3d at 726).
11
Docket No. 81.
12
Docket No. 59-41, at 7.
Id. at 13.
13
Id.
14
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after the case was transferred back to this Court, Defendants refused to respond to the Court’s
repeated orders to appoint counsel and respond to Plaintiff’s motions. This Court has already
found that Defendants’ actions were highly prejudicial to the Plaintiff, that Defendants interfered
with the judicial process, and that Defendants were highly culpable. Therefore, the Court will
grant Plaintiff’s Motion.
B.
COSTS
Plaintiff also argues that it should be awarded its costs. Under both Fed. R. Civ. P. 54(d)
and DUCivR 54-2, it is the Clerk of Court who may tax costs, if any. Plaintiff must make any
motion for costs to the Clerk of the Court in accordance with Fed. R. Civ. P. 54(d) and DUCivR
54-2. Therefore, the Court will not address Plaintiff’s request for costs at this time.
III. CONCLUSION
It is therefore
ORDERED that Plaintiff’s Motion for Award of Costs and Attorney Fees (Docket No.
82) is GRANTED. Plaintiffs are awarded $211,408.75 for fees. Plaintiff is also awarded its
taxable costs in the amount determined by the Clerk of Court.
DATED December 13, 2012.
BY THE COURT:
_____________________________________
TED STEWART
United States District Judge
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