UBS Bank USA v. Mullins
MEMORANDUM DECISION granting in part and denying in part 94 Motion for Attorney Fees. Fees and costs are awarded as follows. Riker Danzigs attorneys are billed at a rate of $210 per hour, for 459.80 hours, for a total amount of $95,927 .15 Andersons attorney is billed at a rate of $210 per hour, for 18.75 hours, for a total amount of $3,982.50. Total costs as requested are $3,877.06. And thus, Plaintiffs counsel is entitled to total attorneys fees and costs in the amount of $103,786.56. Signed by Judge Ted Stewart on 02/15/2012. (tls)
IN THE UNITED STATES COURT FOR THE DISTRICT OF UTAH
UBS BANK USA,
MEMORANDUM DECISION AND
ORDER ON PLAINTIFF’S MOTION
FOR ATTORNEYS’ FEES
HAL S. MULLINS,
Case No. 2:08-CV-814 TS
This matter is before the Court on Plaintiff’s Motion for Attorney Fees, Costs and
Expenses. 1 As set forth below, the Court will grant in part and deny in part Plaintiff’s Motion.
This matter arises from a contract dispute between Plaintiff UBS Bank, USA (the
“Bank”) and Defendant Hal S. Mullins (“Mullins”). The Bank and Mullins entered into a credit
line agreement (the “Agreement”) dated November 22, 2006, in which the Bank established a
demand revolving line of credit for Mullins. The Bank subsequently advanced two loans to
Mullins in the principal amounts of $3,000,000 and $402,732 (collectively, the “Loans”).
Under the terms of the Agreement, the Bank was obligated to make advances to Mullins
upon his request, but the Bank had the right to demand repayment of the Loans plus accrued
interest at any time. The Agreement also called for Mullins to maintain a collateral account with
an aggregate lending value specified by the Bank. If securities were used as collateral and
subsequently decreased below the required maintenance level, the Agreement granted the Bank
Docket No. 94.
the option to sell the securities as repayment for the Loans. Mullins pledged securities as
collateral for the Loans, and when those stocks declined below the collateral maintenance level,
the Bank exercised its right to liquidate the collateral and sold the securities on publicly
recognized exchanges. The resulting proceeds, however, fell short of the amount Mullins owed
the Bank by a deficit of $280,160.78. After Mullins refused to repay the deficit, the Bank filed
an action to recover the amount owed on the Loans, plus fees, costs, and expenses incurred by
the Bank in connection with Mullins’ failure and refusal to repay the loans.
In an Order dated July 18, 2011, the Court granted summary judgment in favor of the
Bank on its breach of contract and account stated claims and denied Plaintiff’s claim for unjust
enrichment. 2 As a result of this ruling, the Court awarded damages in the amount of
$307,503.65, plus interest, costs, and attorneys’ fees.
This Court included attorneys’ fees and costs in the damage award because the
Agreement specifically provided that Mullins would pay “any and all fees or other charges
payable in connection with the Advances and any costs of collection (including reasonable
attorney’s fees).” Although Mullins generally contested the award of attorneys’ fees, the Court
rejected Mullins’ arguments as insufficient to support his allegations. On September 29, 2011,
the Court entered a judgment in favor of the Bank against Mullins in the amount of $311,198.40,
plus attorneys’ fees, costs and post-judgment interest. Consequently, the Bank has now filed the
instant Motion, wherein they seek their fees and costs.
Plaintiff’s Motion seeks fees and costs in the amount of $140,570.56, for a total amended
judgment of $451,768.96. During this case the Bank was represented by two law firms: Riker
Docket No. 90.
Danzig Scherer Hyland Perretti LLP (“Riker Danzig”) and Anderson & Karrenberg, P.C.
(“Anderson”). As primary counsel, Riker Danzig charged attorneys’ fees of $133,342 at an
blended rate of $290 per hour, and incurred costs of $7,752.49, for a total of $141,094.49.
Anderson charged $3,982.50 in attorneys’ fees, at an hourly rate of $210 per hour, and incurred
costs of $816.81, for a total of $4,799.31. The Bank has not requested recovery of fees and costs
that the Bank incurred in connection with the pro hac vice admission of its New Jersey counsel
in this action. In total, Bank seeks fees and costs in the amount of $140,570.56.
Mullins argues that Bank’s counsel charged extreme and excessive attorneys’ fees.
Specifically, he argues that Bank’s counsel charged for duplicative work, and “on-the-jobtraining” fees for inexperienced attorneys unfamiliar with Utah law. In addition, he contends
that the higher billable rate charged by out-of-state counsel—Riker Danzig—was unreasonable,
especially because the matter could have been handled by local counsel at lower hourly rates.
Finally, Mullins argues that the exhibits supporting Plaintiff’s Motion for attorneys’ fees are
redacted to such an extent that it is impossible to tell whether some fee charges are justified.
In response, the Bank argues that Mullins has failed to provide any specific examples to
support his assertion that the Bank’s legal expenses are excessive and duplicative. The Bank
contends that a significant portion of the its legal fees are attributable to claims and issues that
Mullins, not the Bank, injected into this straightforward collection action. As to Mullins’
assertion that some attorneys representing the Bank are “inexperienced” and “unqualified,” the
Bank argues that the submitted billing records show that the Bank has not charged for training
associates and all attorneys working on this matter were either partners or associates who had
been practicing for many years. Finally, the Bank contends that all costs associated with New
Jersey attorneys practicing in Utah were omitted from their Motion for attorneys’ fees and costs.
Each argument will be addressed in turn.
REASONABLENESS OF ATTORNEYS’ FEES
“Attorney’s fees awarded pursuant to a contract should not be given scrutiny to the same
degree as fees awarded in a statutory context, but should be awarded consistent with the
contractual purpose of giving the parties the benefit of their bargain.” 3 “Where attorney’s fees
are provided by contract, a trial court does not possess the same degree of equitable discretion to
deny such fees as it has when applying a statute providing for a discretionary award.” 4
Nevertheless, a court may reduce the contractual attorney’s fees claimed if the court finds such
award “would be inequitable or unreasonable.” 5
In evaluating the reasonableness of a fee application under Utah law, 6 a court must
consider several factors, including:
the amount in controversy; the extent of services rendered; the relationship of the
fee to the amount recovered; the novelty and difficulty of the issues involved; the
overall result achieved; the necessity of initiating a lawsuit to vindicate rights
under the contract; the difficulty of the litigation; the efficiency of the attorneys in
presenting the case; the reasonableness of the hours spent on the case; the fee
customarily charged in the locality for similar services; and the expertise and
experience of the attorneys. 7
Mark Tech. Corp. v. Utah Res. Int’l, Inc., No. 2:03CV831 DAK, 2006 WL 1073559, at
*1 (D. Utah Apr. 20, 2006) (unpublished); see U.S. for Use of C.J.C. Inc. v. W. States Mech.
Contractors, Inc., 834 F.2d 1533, 1548 (10th Cir. 1987).
U.S. for Use of C.J.C. Inc., 834 F.2d at 1548.
When considering whether a fee is unreasonable, a trial court may consider “the
familiar factors from the federal cases awarding fees in a statutory context.” Mark Tech. Corp.,
2006 WL 1073559, at *1. “The district court may choose to use these factors, not to compute a
reasonable fee, but to assist in determining if the fees claimed are unreasonable or inequitable.”
See Dixie State Bank v. Bracken, 764 P.2d 985, 989 (Utah 1988).
1. REASONABLE BILLABLE HOUR RATES
Mullins argues that the hourly rates charged by Bank’s New Jersey counsel—Riker
Danzig—are excessive by Salt Lake City standards and, therefore, he should not be required to
bear these additional costs. Under Utah law, courts have assessed the reasonableness of fees in
light of the “fee customarily charged in the locality for similar services.” 8 In Mark Technologies
Corp. v. Utah Resources International, Inc., 9 the court limited the amount of attorney’s fees
awarded to Chicago-based counsel to the prevailing Salt Lake City hourly rates because the
“subject matter of the litigation [was] not so unusual that it required special skills that only an
out-of-state lawyer possesses.” 10 Similarly, the Tenth Circuit has, when determining the
reasonable rate of compensation, examined “what lawyers of comparable skill and experience
practicing in the area in which the litigation occurs would charge for their time.” 11
Here, the Court finds that there is some support for the contention that the hourly rates for
New Jersey counsel are excessive by Salt Lake City standards. The partner at Bank’s Salt Lake
City counsel—Anderson—charged an hourly rate of $210, which is $80 per hour less than the
blended rate charged by Riker Danzig. In addition, the subject matter of the litigation was not
so difficult or complex as to warrant the specialized services of out-of-state counsel. Although
each party has the right to choose its own counsel, the Court finds it would be “inappropriate to
require the opposing party to bear these additional costs associated with such a decision when
Id; see also Feldman v. Prudential Ins. Co. of Am., No. 2:06CV315 DAK, 2008 WL
376252, at *1 (D. Utah Feb. 11, 2008) (unpublished); Mark Tech. Corp., 2006 WL 1073559, at
2006 WL 1073559.
Id. at *1-2.
Ramos v. Lamm, 713 F.2d 546, 555 (10th Cir. 1983).
local firms were available to handle the litigation.” 12 Therefore, the Court finds that Riker
Danzig’s hourly rates should be set at prevailing Salt Lake City rates.
Mullins also argues that Bank’s counsel charged “on-the-job-training-costs” for
inexperienced attorneys. However, Mullins does not provide any specific evidence to support
this assertion, and the Declaration of Stephen P. Horvat provides credible evidence that the
Bank’s attorneys were competent and experienced. In fact, the Bank’s attorneys are either
partners at their firms or associates who have been practicing for a number of years. And
although Riker Danzig billed at a blended hourly rate—a billing technique that charges clients
the same hourly rate regardless of whether a partner or associate worked on the matter—the
Court finds that there is no evidence to suggest that this rate was unreasonable for any of the
associates or partners participating in this litigation.
Mullins does not argue that the hourly rate charged by Anderson was excessive. The
only evidence that the Bank provides for the hourly rate charged by Anderson is the Declaration
of Stephen P. Horvat, an attorney for Anderson. Although a court may give less weight to selfinterested testimony 13 and rely upon its own knowledge of the prevailing market rate 14 when
determining whether such fees are reasonable, the Court finds that the hourly rate of $210
charged by Anderson is reasonable.
Because the hourly rate of $210 provided by Anderson is evidence of the prevailing
market rate for a partner in Salt Lake City, and the Court finds that this rate is reasonable based
Mark Tech. Corp., 2006 WL 1073559, at *2; see also Ramos, 713 F.2d at 555.
See Lucero v. City of Trinidad, 815 F.2d 1384, 1385 (10th Cir. 1987).
Id.; Case v. Unified Sch. Dist. No. 233, 157 F.3d 1243, 1257 (10th Cir. 1998) (Only if the
district court “does not have before it adequate evidence of prevailing market rates may the
court, in its discretion, use other relevant factors, including its own knowledge, to establish the
upon its own knowledge of the prevailing market rate, the Court will apply this hourly rate to the
attorneys from Riker Danzig.
2. REASONABLE AMOUNT OF HOURS BILLED
Mullins further contends, without providing any specific support, that Bank’s counsel
billed an unreasonable amount of hours on this case. After reviewing the detailed,
contemporaneous time records supplied by Bank’s counsel, the Court finds that the amount of
hours billed was reasonable. A significant portion of the Bank’s legal fees are attributable to
claims and issues that Mullins, not the Bank, injected into this collection action. These include
Mullins’ time consuming discovery requests, counterclaims against the Bank, and filing of an
unsuccessful motion to dismiss or stay the Bank’s Complaint. For these reasons, the Court finds
that Bank’s counsel expended a reasonable amount of hours billed on this matter.
Finally, Mullins claims that in the 109-page invoice submitted with Plaintiff’s Motion for
attorneys’ fees, there is a significant amount of invoices improperly redacted so as to prevent one
from ascertaining the reasonableness of the fees incurred. While the invoice does contain
redactions, the information provided is more than sufficient for the Court to determine the
reasonableness of the attorneys’ fees sought. As a result, the Court rejects Mullins’ argument on
Based on the foregoing, it is therefore
ORDERED that Plaintiff’s Motion for Attorney Fees, Costs and Expenses (Docket No.
94) is GRANTED IN PART AND DENIED IN PART. Fees and costs are awarded as follows.
Riker Danzig’s attorneys are billed at a rate of $210 per hour, for 459.80 hours, for a total
amount of $95,927. 15 Anderson’s attorney is billed at a rate of $210 per hour, for 18.75 hours,
for a total amount of $3,982.50. Total costs as requested are $3,877.06. And thus, Plaintiff’s
counsel is entitled to total attorneys’ fees and costs in the amount of $103,786.56.
DATED February 15, 2012.
BY THE COURT:
United States District Judge
This figure reflects a $631 reduction related to the pro hac vice admission of Danzig’s
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