FLAME S.A. v. INDUSTRIAL CARRIERS, INC. et al
Filing
570
MEMORANDUM OPINION AND ORDER Granting 428 Motion for Attorney Fees. Having found that Flame is entitled to its reasonable expenses incurred resulting from FBP's violation of the Court's Discovery Order, and having found that those ex penses properly include attorneys' lees for all of the 131 hours requested at the hourly rates requested. Flame's Second Motion for Award of Attorneys' Fees, ECF No. 428. is GRANTED, and Flame is awarded reasonable attorneys' fees in the amount of $39,318.50 against both FBP and its counsel. It is so ORDERED.. Signed by Magistrate Judge Lawrence R. Leonard and filed on 10/22/14. Copies distributed to all parties 10/22/14. (ldab, )
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
Norfolk Division
FLAME S.A.,
Plaintiff,
GLORY WEALTH SHIPPING PTE LTD.,
Consolidated Plaintiff,
CIVIL ACTION NO. 2:13-cv-658
v.
INDUSTRIAL CARRIERS, INC., et al.,
Defendants.
MEMORANDUM OPINION AND ORDER
Before the Court is Plaintiff Flame S.A.'s ("Flame") Second Motion for Award of
Attorneys' Fees and Costs, and accompanying memorandum in support.1 ECF Nos. 428, 429.
Flame's motion is predicated on the Court's August 8, 2014 Order, ECF No. 377, ("Sanctions
Order") which was issued in response to Flame's Motion for Sanctions, ECF No. 326, and
awarded Flame reasonable attorneys' fees and expenses, inter alia, as sanctions for Defendant
Freight Bulk Pte LTD's ("FBP") violation of the Court's April 30, 2014 Discovery Order, ECF
No. 210 ("Discovery Order").2 In its Sanctions Order, the Court directed Flame to submit,
within thirty days of the date of the Order, a motion substantiating its costs and fees pursuant to
the factors enumerated in Robinson v. Equifax Info. Servs., LLC, 560 F.3d 235, 243-44 (4th Cir.
2009). ECF No. 377 at 24. While Flame has now done so, seeking attorneys' fees in the amount
of $39,318.50, FBP did not file any opposition to this motion, and the time to do so has expired.
Accordingly, Flame's motion is ripe for disposition.
1While Flame included "Costs" in the caption of its motion, itdid not seek costs in its proffer or request for relief.
2The Discovery Order granted in part, denied in part, and deferred in part, Flame's third and fourth motions to
compel, ECF Nos. 179 and 181.
I. PROCEDURAL BACKGROUND
In its Motion for Sanctions, Flame claimed that FBP failed to comply with the Discovery
Order and cited nine categories of requested discovery that FBP had not produced in violation of
the Discovery Order:
1. Corporate Records (ECF Nos. 324 at 7-9; 327 at 4-6).
2. Emails Sent or Received by Victor Baransky (ECF Nos. 324 at 9-10; 327 at 6-8).
3. Supporting Documentation for Bank Records (ECF Nos. 324 at 10-11; 327 at 8-10).
4. Attachment to the Loan Agreement Between Sea Traffic Shipping Co. and FBP (ECF
Nos. 324 at 11-12; 327 at 10-11).
5. Charters for the M/V CAPE VIEWER and HARMONY FALCON (ECF Nos. 324 at
12-13; 327 at 11-13).
6. Documents from Industrial Carriers Inc. ("ICI") (ECF Nos. 324 at 13; 327 at 14).
7. Audit Documentation and Correspondence (ECF No. 327 at 13-14).
8. All Attachments to Emails and Other Documents (ECF No. 327 at 14-16).
9. Defense Evidence (ECF No. 327 at 16-17).
Flame consequently sought sanctions for FBP's violations, including attorneys' fees and costs it
incurred because of FBP's failure to obey the Court's Discovery Order.3 In its Sanction Order,
the Court found that FBP did not violate the Court's Discovery Order in connection with its
production of the supporting documentation for bank records, the charter parties for the CAPE
VIEWER and HARMONY FALCON, audit documentation and correspondence, and defense
evidence, but that FBP did violate the Court's Discovery Order by failing to produce documents
pertaining to ICI, including corporate records, and the attachment to the loan agreement between
Sea Traffic and FBP evidencing the loan repayment terms. ECF No. 377 at 19. In addition, the
3 Flame also sought reconsideration of that part of the Court's Discovery Order limiting discovery to the named
defendants. That part of Flame's motion was denied. ECF No. 377 at 25.
2
Court found that FBP violated the Discovery Order by failing to produce, in a timely fashion,
Viktor Baransky's emails and the attachments thereto. Id. Evaluating FBP's conduct under
Federal Rule of Civil Procedure 37(b)(2)(A) and the standards enunciated in Anderson v. Found.
for Advancement, Educ. & Emp't ofAm. Indians, 155 F.3d 500, 504 (4th Cir. 1998), the Court
found that such conduct warranted the imposition of sanctions, including reasonable expenses
incurred as a result of FBP's failure to obey the Court's Discovery Order. Id. at 19-24. Based on
FBP's counsel's role in advising the disobedient party, the Court awarded Flame its reasonable
expenses against both FBP and its attorneys. Id. at 24 n. 12.
II. ANALYSIS
A.
Reasonableness of Claimed Attorneys' Fees
"District courts have discretion in determining attorneys' fees, but there must be
evidence supporting the reasonableness of these fees." United Mktg. Solutions, Inc. v. Fowler,
No. l:09-cv-1392, 2011 WL 837112, at *4 (E.D. Va. Mar. 2, 2011). The burden is on the party
requesting fees to establish their reasonableness. Plyler v. Evatt, 902 F.2d 273, 277 (4th Cir.
1990); Cook v. Andrews, 7 F. Supp. 2d 733, 736 (E.D. Va. 1998). The reasonableness of the
amount must be established "both by showing the reasonableness of the rate claimed and the
number of hours spent." Rehab. Ass'n ofVa., Inc. v. Metcalf 8 F. Supp. 2d 520, 527 (E.D. Va.
1998). The Court evaluates the reasonableness of attorneys' fees by comparing the requested
amount to the lodestar amount, which is defined as a "reasonable hourly rate multiplied by hours
reasonably expended." Grissom v. Mills Corp., 549 F.3d 313, 320-21 (4th Cir. 2008).
In deciding what constitutes a 'reasonable' number of hours and rate, [the Fourth
Circuit] has instructed that a district court's discretion should be guided by the
following twelve factors: (1) the time and labor expended; (2) the novelty and
difficulty of the questions raised; (3) the skill required to properly perform the
legal services rendered; (4) the attorney's opportunity costs in pressing the instant
litigation; (5) the customary fee for like work; (6) the attorney's expectations at
the outset of the litigation; (7) the time limitations imposed by the client or
circumstances; (8) the amount in controversy and the results obtained; (9) the
experience, reputation and ability of the attorney; (10) the undesirability of the
case within the legal community in which the suit arose; (11) the nature and
length of the professional relationship between attorney and client; and (12)
attorneys' fees awards in similar cases.
Robinson, 560 F.3d at 243-44 (citation omitted).
Because this matter involves a discovery
motion under Rule 37(b) rather than the complete disposition of a case after trial, the Court finds
that the only the first, second, third, fifth, ninth and twelfth factors are particularly applicable.
See SunTrust Bank v. Nik, No. 1:11CV343, 2012 WL 1344390, at *3 (E.D. Va. Mar. 22, 2012).
The Court addresses the relevant factors in turn.
1.
Factor 1: The Time and Labor Expended
In support of its request for attorneys' fees incurred because of FBP's violation of the
Discovery Order, Flame proffered declarations from its lead attorneys Steven M. Stancliff with
the Crenshaw, Ware & Martin, P.L.C. law firm ("Crenshaw"), and William R. Bennett, III with
the Blank Rome LLP law firm, along with billing records from the two firms. In addition, Flame
proffered the declaration of attorney Robert F. McFarland, an experienced Norfolk civil litigator
who is not involved in this case. ECF No. 429, attachs. 1-3. The billing records detail the tasks
performed, which attorneys Stancliff and Bennett contend were necessitated by FBP's
disobedience. Id, attach. 1-2. According to these records, Crenshaw attorneys Stancliff and
David C. Hartnett billed 11.1 and 2.7 hours, respectively, and paralegal Stephanie Hunter billed
1.4 hours, for a total of 15.2 hours. Further, Blank Rome attorneys Bennett, Thomas H. Belknap,
Jr., Nicholas Tambone and Lauren B. Wilgus billed 25, 0.8, 54.3 and 35.7 hours, respectively,
for a total of 115.8 hours. In sum, Flame seeks attorneys' fees for a total of 131 hours of work
caused by FBP's violation of the Court's Discovery Order.
Based on a careful review of the Stancliff and Bennett declarations and the attendant
billing records, and Flame's memorandum in support of its motion, the Court FINDS that the
time and labor expended was reasonable under the circumstances. As noted by the Court in its
Sanctions Order, FBP's willful violation of the Discovery Order caused prejudice to Flame in
prosecuting this case and "needlessly increased the expense, annoyance, and delay of these
proceedings." ECF No. 377 at 22. The tasks specified in the billing records provide a detailed
account of the work performed and demonstrate the labor Flame was required to expend because
of FBP's refusal to comply with the Discovery Order. Moreover, FBP chose not to submit any
opposition to Flame's motion for attorneys' fees, so FBP has failed to rebut any of Flame's
assertions in the motion. Consequently, the Court will award Flame its attorneys' fees for the
full 131 hours billed.
2.
Factors 2 and 3: The Novelty and Difficulty of the Questions Raised and the Skill
Required to Properly Perform the Legal Services Rendered.
The novelty and difficulty of the questions raised as a result of FBP's disobedience were
not insignificant based on FBP's discovery misconduct. FBP's history of stonewalling discovery
and delay tactics presented a complex challenge to Flame to secure the discovery to which it was
entitled.
Accordingly, this factor weighs in favor of Flame.
Because of FBP's conduct, a
significant amount of skill was required in order to respond to FBP's tactics, resulting in
favorable rulings in the Sanctions Order. Accordingly, the Court FINDS the second and third
factors favor Flame's request for attorneys' fees.
3.
Factors 5. 9 and 12: The Customary Fee for Like Work, Attorney Experience. Reputation
and Ability, and Fee Awards in Similar Cases.
The remaining three factors the Court must consider here in determining Flame's fee
request further impact the hourly rate at which Flame seeks reimbursement for its attorneys.
Flame seeks an hourly rate award as follows: for Blank Rome attorneys Belknap, Bennett,
Tambone and Wilgus, $360 per hour, $325 per hour, $300 per hour, and $300 per hour,
respectively; for Crenshaw attorneys Stancliffe and Hartnett and paralegal Hunter, $285 per
hour, $210 per hour, and $125 per hour, respectively. In support of its hourly rate claim, Flame
relied upon the Stancliff and Bennett declarations, along with the declaration of attorney
McFarland confirming that the rates requested were reasonable, and its discussion in its
memorandum in support of its motion of the attorneys' experience. Concerning the fifth factor,
Mr. McFarland stated in his declaration that the rates charged by the attorneys are
"commensurate with and actually lower than the rates typically charged or billed by other
attorneys with similar experience in the Hampton Roads legal community for handling matters in
civil litigation before the United States District Court for the Eastern District of Virginia,
Norfolk Division." ECF No. 429, attach. 3, fflj 9, 11. Mr. McFarland's declaration, unrebutted
by FBP, supports an award at the rates Flame seeks here. See Robinson, 560 F.3d at 245 (finding
that "[e]xamples of the type of specific evidence that [the Fourth Circuit] ha[s] held is sufficient
to verify the prevailing market rates are affidavits of other local lawyers who are familiar both
with the skills of the fee applicants and more generally with the type of work in the relevant
community").
Concerning the ninth factor, as demonstrated by Flame, each of the attorneys who
worked on this matter are experienced maritime and admiralty attorneys, with the possible
exception of Mr. Tambone, who is described as an experienced commercial litigator. FBP, of
course, has not contested the skill, experience and abilities of the attorneys and paralegal. Thus,
Flame's representation of the capabilities and credentials of the attorneys and paralegal are
unchallenged by FBP.
Concerning the twelfth factor, Flame relies on Stewart v. VCU Health Sys. Auth., No.
3:09CV738, 2012 U.S. Dist. LEXIS 47355 (E.D. Va. Apr. 3, 2012) and Paice, LLC v. Himdai
Motor Co., No. WDQ-12-0499, 2014 U.S. Dist. LEXIS 95043 (D. Md. June 27, 2014), two
recent cases within the Fourth Circuit in which the movants were awarded $28,547.25 and
$35,000, respectively, for prevailing in contested discovery disputes. These cases are pertinent
because they were both decided pursuant to Rule 37(b)(2)(C) based on the parties' failure to
comply with court orders, and the Court considers them relevant to Flame's present motion.
Both cases indicate that Flame's present request is similar to fee awards granted in cases within
the Fourth Circuit in regard to the underlying discovery dispute and the size of the fee award.
For example, in Stewart, the "Plaintiffs repeated failure to comply with his discovery
obligations ... despite numerous warnings of looming sanctions" justified the substantial award.
Stewart, 2012 U.S. Dist. LEXIS 47355, at *1. Additionally, in Paice, the large fee award was
warranted where the "Defendants and/or defense counsel have delayed or have been remarkably
ineffective in executing their discovery obligations" even though there was no evidence of bad
faith. Paice, LLC, 2014 U.S. Dist. LEXIS 95043, at *42.
In its prior Order awarding Flame attorneys' fees, the Court found that the billable rates
charged by Messrs. Bennett, Stancliffe and Hartnett and Ms. Hunter were reasonable and
customary. ECF No. 498 at 15. FBP did not contest these rates then, and it did not do so now.
Accordingly, in considering the factors for customary fee for like work, the attorneys'
experience, reputation and ability, and fee awards in similar cases as discussed supra, the Court
FINDS that the hourly rates requested by Flame for each of its attorneys and paralegal are
reasonable and customary.
III. CONCLUSION
Having found that Flame is entitled to its reasonable expenses incurred resulting from
FBP's violation of the Court's Discovery Order, and having found that those expenses properly
include attorneys* lees for all of the 131 hours requested at the hourly rates requested. Flame's
Second Motion for Award of Attorneys' Fees, ECF No. 428. is GRANTED, and Flame is
awarded reasonable attorneys' fees in the amount of $39,318.50 against both FBP and its
counsel.
The Clerk is DIRECTED to forward a copy of this Order to all counsel of record.
It is so ORDERED.
Lawrence R. Leonard
United States Magistrate Judge
Norfolk. Virginia
October 22, 2014
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