Widman v. Keene et al

Filing 196

ORDER granting in part and denying in part 169 Motion for Attorney Fees; granting in part and denying in part 177 Motion for Attorney Fees; granting in part and denying in part 177 Motion for Entry of Judgment. Widman is enti tled to recover $63,843 in attorney fees. To the extent there are any outstanding obligations to Shell or Keene on the Mesa Vista and Green Gables Promissory Notes, they are hereby offset against Widmans fee award. Finally, Defendants are ORDERED TO SHOW CAUSE in writing within fourteen days as to why sanctions should not be imposed for their Objection to Courts Second Order of September 30, 2014. Signed by Judge Clark Waddoups on 10/9/2015. (jwt)

IN THE UNITED STATES DISTRICT COURT
DISTRICT OF UTAH, CENTRAL DIVISION

KAREN WIDMAN,
ORDER
Plaintiff,
v.

Case No. 2:10-cv-00459

MARILEE E. KEENE and DAVID SHELL,

Judge Clark Waddoups

Defendants.

INTRODUCTION
This case is before the court on Plaintiff Karen Widman’s (“Widman”) Motions for
Attorney Fees. (Dkt. Nos. 169, 177). After carefully considering the parties’ submissions, the
relevant legal authorities, and otherwise being fully advised, the court GRANTS IN PART and
DENIES IN PART Widman’s Motions for Attorney Fees. In addition, Defendants are ORDERED
TO SHOW CAUSE why sanctions should not be imposed for their Objection to Court’s Second
Order of September 30, 2014, (Dkt. No. 183).
BACKGROUND
This court conducted a bench trial from April 23 through April 25, 2014 and subsequently
rendered a Memorandum Decision and Order setting forth its findings of fact and conclusions of
law on Widman’s Complaint, Keene’s Counterclaim, and Shell’s Amended Complaint. (Dkt. No.
167). The general background of this case and the court’s discussion on specific claims is fully set
out in the Memorandum Decision. For purposes of this opinion, it is sufficient to note that the
court found Widman was the prevailing party and that attorney fees and costs were warranted in

her favor. (Dkt. No. 167, p. 50); see also (Dkt. No. 174, pp. 1–2). As such, the only outstanding
issue is the reasonableness of the claimed fees.
Widman filed her first Motion for Attorney Fees and Request for Offset on September 9,
2014. (Dkt. No. 169). Meanwhile, Defendants filed a Motion for a New Trial and to Alter or
Amend the Judgment. (Dkt. No. 171). On September 30, 2014 the court issued an order denying
the request for a new trial and awarding attorney fees to Widman. (Dkt. No. 174). Defendants
objected on the grounds that they had not been afforded an opportunity to oppose Widman’s
motion or file a reply to their Motion for a New Trial. In a subsequent order, the court affirmed its
denial of the Motion for a New Trial because “Defendants had ‘failed to raise any legitimate basis
for relief in its opening memorandum.’” (Dkt. No. 176, p. 1). However, partial reconsideration
was granted in relation to the entry of attorney fees. Although the opposition to a non-dispositive
motion is generally due within fourteen days, the court vacated the fee award because the
Memorandum Decision had previously extended that deadline to thirty days. Defendants were
given an opportunity to file an Objection to Widman’s Motion, but were specifically admonished
not to reargue the prevailing party designation.
Widman has since filed a second Motion for Attorney Fees incurred in responding to the
Motion for a New Trial. (Dkt. No. 177). Defendants have submitted an Opposition to Widman’s
first Motion for Attorney Fees, (Dkt. No. 182), arguing that this court lacks jurisdiction to enter
an award of attorney fees, that Widman was not the prevailing party, that certain fees are not
recoverable, and that offset has been waived and is unavailable, or is limited to amounts awarded
in this suit. They have also filed an Objection to Court’s Second Order of September 30, 2014.
(Dkt. No. 183).

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ANALYSIS
I. Attorney Fees
Under California law, the prevailing party to an action based on a contract is entitled to
reasonable attorney fees if the contract specifically provides for such an award. CAL. CIV. CODE §
1717. As the court noted in its Memorandum Decision, “attorney fees and costs are contemplated
not only under the Marital Settlement Agreement, but also the Notes that were assigned to
Keene.” (Dkt. No. 167, p. 50). 1 Having previously concluded that Widman was the prevailing
party on two separate occasions, the court shall not entertain further argument on the matter and
will proceed to analyze the reasonableness of the fees.
“[T]he fee setting inquiry in California ordinarily begins with the ‘lodestar,’ i.e., the
number of hours reasonably expended multiplied by the reasonable hourly rate.” PLCM Grp. v.
Drexler, 997 P.2d 511, 518 (Cal. 2000). “The reasonable hourly rate is that prevailing in the
community for similar work.” Id. Once that is calculated, “[t]he lodestar figure may then be
adjusted, based on considerations of factors specific to the case, in order to fix the fee at the fair
market value for the legal services provided.” Id. Widman requests a total of $71,198 in attorney
fees for 344.05 hours spent in litigation. The majority of the work was conducted by Rodney
Rivers, who charged $200–225, and William Jeffs, who charged $175–225. Additional work was
performed by Liisa Hancock ($170), Matthew Jeffs ($100), Helen Burk ($60), and a law clerk
($60).
As an initial matter, the court finds that the hourly rates are reasonable and consistent with
similar rates charged in the surrounding legal community for the type of case and level of

1

Defendants’ argument that the Notes cannot serve as the basis for an award of attorney fees because they are
unexecuted is frivolous and fails on its face. See (Dkt. No. 167, pp. 23–24) (“The court concludes that the evidence
presented in this case more than adequately establishes that the Trust Deed Notes were executed and delivered by
Widman to Shell on or about February 25, 2005.”).

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experience of Plaintiff’s counsel. However, the court must address the Opposition’s arguments
that certain billing entries are not recoverable and make any necessary adjustments.
Without citing to any case law, Defendants contend that the court should deny fees for
time spent on Widman’s Motions for Summary Judgment,2 for any theories in the Complaint that
were not prevailed upon, and for time spent before the filing of the Complaint. They also discount
William Jeffs’ hours for the reason that he was not counsel of record in the case. These arguments
are in direct contradiction to applicable precedent. The Supreme Court has specifically held that:
Where a plaintiff has obtained excellent results, his attorney should recover a fully
compensatory fee. Normally this will encompass all hours reasonably expended on
the litigation, and in some cases of exceptional success an enhanced award may be
justified. In these circumstances the fee award should not be reduced simply
because the plaintiff failed to prevail on every contention raised in the lawsuit.
Litigants in good faith may raise alternative legal grounds for a desired outcome,
and the court’s rejection of or failure to reach certain grounds is not a sufficient
reason for reducing a fee. The result is what matters.
Hensley v. Eckerhart, 461 U.S. 424, 435 (1983) (citations omitted). Moreover, there is no
requirement that an attorney has to make an appearance in order to become eligible for fees. See
Mix v. Tumanjan Dev. Corp., 126 Cal. Rptr. 2d 267, 271–72 (Ct. App. 2002) (“There is no
authority or reason to require a formal association on the record in order for attorney fees to be
recoverable.”).
Not all of Defendants’ arguments lack merit. To begin with, they point out that a time
sheet entry for Jeffs on March 25, 2010, titled “Review of the Letter on the Horse” is not
recoverable because it is not part of this litigation. The amount billed was 0.25 hours at a rate of
$200, for a total of $50. Widman concedes that the charge is unrelated to the present case in her
Reply. (Dkt. No. 184, p. 7). Defendants also note that Jeffs billed his hourly rate of $225 for his
2

As to Widman’s First Motion for Partial Summary Judgment, (Dkt. No. 20), and Keene’s Cross-Motion for Partial
Summary Judgment, (Dkt. No. 24), the court found that there were disputes of material fact that precluded summary
judgment for either party. Widman’s Second Motion for Partial Summary Judgment, (Dkt. No. 60), was stricken
because it was filed well after thirty days from the close of discovery.

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time testifying as a fact witness during the bench trial.3 However, an attorney cannot recover fees
for time they spend in the capacity of a fact witness. See Hancock v. Chicago Title Ins. Co., Nos.
3:07-CV-1441-D, 3:08-CV-1916-D, 2013 WL 2391500, at *12 (N.D. Tex. June 3, 2013); see also
Emmenegger v. Bull Moose Tube Co., 33 F.Supp.2d 1127, 1138 (E.D. Mo. 1998); Irons v.
Karceski, 74 F.3d 1262 (D.C. Cir. 1995). Because Jeffs’ time entries are block billed as 31 hours
for “Travel to Salt Lake and Attend Trial” during April 23–25, 2014 and 2 hours for “Trial
Preparation” on April 21–22, 2014, they are insufficient to allow for a determination over which
time, if any, was billed in his capacity as an attorney for Widman. Having discretion to assign a
reasonable percentage to block billed entries or simply cast them aside, the court will reduce the
amount billed to $40—the rate a fact witnesses may recover under 28 U.S.C. § 1821 for testifying
in a federal court—for every day Jeffs testified, and discount the two hours he spent preparing for
trial. See Bell v. Vista Unified Sch. Dist., 98 Cal. Rptr. 2d 263, 274–75 (Ct. App. 2000); see also
Heritage Pac. Fin., LLC v. Monroy, 156 Cal. Rptr. 3d 26, 55 (Ct. App. 2013) (“Trial courts retain
discretion to penalize block billing when the practice prevents them from discerning which tasks
are compensable and which are not.”).
Taking these adjustments into consideration, the court concludes that Widman’s fees must
be reduced by $7,355,4 resulting in a final award of $63,843.
II. Offset
Plaintiff seeks to offset her award of attorney fees with any obligation still pending on the
Mesa Vista and Green Gables Notes. Defendants’ argue that failure to plead offset in Widman’s
3

Widman called Jeffs as a witness on April 23, and cross examination continued during April 24. (Dkt. Nos. 148,
149). Jeffs was recalled to the stand by Defendants on April 25 when they presented their case. (Dkt. No. 150).
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This is comprised of the $50 billed on March 25, 2010 for “Review of the Letter on the Horse,” the $450 billed for
Jeffs’ “Trial Preparation” on April 21–22, 2011, and the $6,855 (representing $6,975 offset by a credit of $40 per day
($120)) billed for Jeffs’ “Travel to Salt Lake and Attend Trial” on April 23–25, 2014.

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Complaint or her Answer to Keene’s Cross-Complaint constitutes waiver. They also contend that
this court is without jurisdiction to offset “amounts which are owed outside this litigation and
through another judgment.” (Dkt. No. 182, p. 2). Thus, they argue that even if offset had been
pled, it would only apply to the $2,786.99 that the court found was still due and owing to Keene
in accrued interest for the late July 2007 payment. These arguments have no support under
California law. “A court has the power, independent of any statute, to set off one judgment
against another. That power rests upon the court’s general jurisdiction.” Birman v. Loeb, 75 Cal.
Rptr. 2d 294, 305 n.4 (Ct. App. 1998) (citations omitted). Furthermore, “there is no particular
procedure required to invoke the equitable power of the court to effect a setoff, when
appropriate.” Fassberg Constr. Co. v. Hous. Auth. of Los Angeles, 60 Cal. Rptr. 3d 375, 413 (Ct.
App. 2007); see also Cordova v. BNSF Ry. Co., E056223, 2014 WL 5764200, at *3 (2014)
(rejecting contention that defendant was required to assert claim for offset as an affirmative
defense).5 The court therefore dismisses Defendants’ arguments and grants Widman’s election to
offset.
III. Order to Show Cause
Defendants Objection to Court’s Second Order of September 30, 2014, (Dkt. No. 183), is
not well taken. The Objection presents no legitimate arguments. Instead, it engages in a multitude
of unprofessional and disrespectful statements about this court and its prior decisions on this
matter. Pursuant to Rule 11 of the Federal Rules of Civil Procedure, “[e]very pleading, written
motion, and other paper must be signed by at least one attorney of record in the attorney’s

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Although California Rules of Court, rule 8.1115 prohibits citations to unpublished decisions, a federal court
exercising diversity jurisdiction is not bound by a state’s procedural rules. See Erie R. Co. v. Tompkins, 304 U.S. 64
(1938); see also Siteworks Solutions, Inc. v. Oracle Corp., No. 08-2130-STA, 2010 WL 890941, at *2 n.8 (W.D.
Tenn. 2010) (“Rule 8.1115(a), however, is a procedural rather than a substantive rule of law. Under the Erie doctrine,
as noted above, this Court is not free to ignore the announcement of a state appellate court on matters of substantive
state law.”).

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name—or by a party personally if the party is unrepresented.” In this case, the Objection was
signed by Shell personally and by Keene’s attorney Randy Andrus. That constitutes a certification
that the Objection was not presented for any improper purpose, that any legal contentions were
warranted by existing law, and that the factual contentions had evidentiary support. FED. R. CIV.
P. 11(b). “If a court determines that a party has violated Rule 11(b), it may, in its discretion,
impose sanctions.” Lundahl v. Home Depot, Inc., 594 F. App’x 453, 455 (10th Cir. 2014).
Moreover, this court has the “inherent authority to sanction a party or attorney who ‘has acted in
bad faith, vexatiously, wantonly, or for oppressive reasons.’” Hutchinson v. Pfeil, 208 F.3d 1180,
1186 (10th Cir. 2000) (quoting Chambers v. NASCO, Inc., 501 U.S. 32, 45–46 (1991)). The court
therefore orders Defendants to show cause why they should not be sanctioned pursuant to Rule 11
and this court’s inherent authority for the statements made in their Objection.
CONCLUSION
It is therefore ORDERED that Plaintiff’s Motions for Attorney Fees, (Dkt. Nos. 169, 177),
are GRANTED IN PART and DENIED IN PART. Widman is entitled to recover $63,843 in
attorney fees. To the extent there are any outstanding obligations to Shell or Keene on the Mesa
Vista and Green Gables Promissory Notes, they are hereby offset against Widman’s fee award.
Finally, Defendants are ORDERED TO SHOW CAUSE in writing within fourteen days as to why
sanctions should not be imposed for their Objection to Court’s Second Order of September 30,
2014.
DATED this 9th day of October, 2015.
BY THE COURT:
______________________________
Clark Waddoups
United States District Court Judge
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