Natzke v. PACCAR Inc
Filing
51
DECISION AND ORDER signed by Chief Judge William C Griesbach on 4/5/2019 granting in part and denying in part 38 Motion for Attorney Fees. Defendant shall pay to Plaintiff the amount of $289,974.50 in attorneys' fees and costs. (cc: all counsel) (Griesbach, William)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
LARRY A. NATZKE
d/b/a Larry Natzke Trucking,
Plaintiff,
v.
Case No. 17-C-637
PACCAR INC.
d/b/a Kenworth Truck Company,
Defendant.
DECISION AND ORDER
Plaintiff Larry A. Natzke filed this action in Wisconsin state court against Defendant
PACCAR Inc., alleging violations of the Wisconsin Lemon Law, Wis. Stat. § 218.0171, involving
the new 2017 Kenworth T880 chassis Plaintiff purchased from Wisconsin Kenworth. Defendant
removed the case to federal court on the basis of diversity jurisdiction. See 28 U.S.C. § 1332. The
parties successfully negotiated a settlement of the merits of this litigation. Presently before the court
is Plaintiff’s motion for attorneys’ fees and costs, pursuant to Wis. Stat. § 218.0171(7), in the
amount of $296,469.50. For the reasons that follow, the motion will be partially granted.
ANALYSIS
Plaintiff seeks fees under Wisconsin’s Lemon Law fee-shifting statute, Wis. Stat.
§ 218.0171. The parties do not dispute that Plaintiff’s motion for an award of attorneys’ fees is
governed by Wisconsin law. Under Wisconsin law, a court calculates a reasonable fee award using
the lodestar method: the number of hours reasonably expended on the work multiplied by a
reasonable hourly rate. Kolupar v. Wilde Pontiac Cadillac, Inc., 2004 WI 112, ¶ 29, 275 Wis. 2d
1, 683 N.W.2d 58. The attorney submitting the fees has the burden of proving the reasonableness
of a fee. Id. at ¶ 34. Wisconsin Statute section 814.045 provides guidelines for determining the
reasonableness of attorneys’ fees under fee-shifting statutes like the Wisconsin Lemon Law. Those
factors include the time and labor required by the attorney; the novelty and difficulty or the
questions involved in the action; the skill required to perform the legal service properly; the
likelihood the acceptance of the particular case precluded other employment by the attorney; the fee
customarily charged in the locality for similar legal services; the amount of damages involved in
the action; the results obtained in the action; the time limitations imposed by the client or by the
circumstances of the action; the nature and length of the attorney’s professional relationship with
his client; the experience, reputation, and ability of the attorney; whether the fee is fixed or
contingent; the complexity of the case; awards of costs and fees in similar cases; the legitimacy or
strength of any defenses or affirmative defenses asserted in the action; and other facts the court
deems important or necessary to consider under the circumstances. Wis. Stat. § 814.045(1).
Plaintiff seeks a total award of $296,469.50 in attorneys’ fees and costs. Defendant does not
dispute the amount of costs requested and does not dispute that, under the Wisconsin Lemon Law,
Plaintiff is entitled to recover reasonable attorneys’ fees. Defendant does, however, contend that
the amount of fees requested is unreasonable.
First, Defendant argues that the hourly rates sought are unreasonable. Plaintiff requests that
the court apply his lawyers’ current hourly rates to the entire period as an adjustment for the delay
in payment. The hourly rates he seeks include $425 per hour for Attorney Vincent Megna, $490 per
hour for Attorney Timothy Aiken, $375 per hour for Attorney Susan Grzeskowiak, and $155 per
hour for paralegal time. The Supreme Court has recognized that “[a]n adjustment for delay in
payment is . . . an appropriate factor in the determination of what constitutes a reasonable attorney’s
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fee.” Missouri v. Jenkins, 491 U.S. 274, 284 (1989). Trial courts may make this adjustment by
calculating the amount with “either current rates or past rates with interest.” Mathur v. Bd. of
Trustees of S. Ill. Univ., 317 F.3d 738, 744–45 (7th Cir. 2003). The court concludes that applying
the current hourly rates to account for the delay in payment is appropriate and will now consider the
reasonableness of the rates requested.
Defendant asserts that Plaintiff’s counsel has failed to present the court with any fee
agreement they have entered into with Plaintiff or any client. Although a fee agreement might
support the reasonableness of the requested fees, such an agreement is not required. Plaintiff’s
attorneys have submitted an affidavit demonstrating that the claimed hourly rates are the rates they
charge to fee-paying clients and that those rates are routinely paid in most of the automobile
warranty claims they have resolved. ECF No. 40 at 3. When an attorney maintains a contingent fee,
an attorney’s “actual billing rate for comparable work is presumptively appropriate to use as the
market rate.” People Who Care v. Rockford Bd. of Educ., 90 F.3d 1307, 1310 (7th Cir. 1996).
Defendant also argues that Plaintiff’s attorneys’ rates are unreasonable because its attorneys
charge lower rates. But what Defendant pays its counsel is only one consideration. It is not enough
to set the market rate for automobile warranty work. Although Defendant’s counsel may be paid
at a lower rate, that rate is certain. Plaintiff’s counsel faced a risk of nonpayment due to the
contingent nature of their representation. It was therefore not unreasonable for Plaintiff’s counsel
to charge a higher rate than Defendant’s counsel. Plaintiff has provided additional support for the
rates requested by way of declarations from other practitioners declaring that the rates sought by
Plaintiff are reasonable and in line with the rates charged by other practitioners. See Crawford Cty.
v. Masel, 238 Wis. 2d 380, 385, 617 N.W.2d 118 (Ct. App. 2000) (noting that “hourly rates charged
by other attorneys of comparable skill can be one indicator of a particular attorney’s market rate”).
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Defendant points out that the rates requested by Plaintiff’s counsel exceed the rates charged by the
other practitioners, but Plaintiff has demonstrated that his counsel has significant experience
litigating automobile warranty claims. Attorney Megna has been practicing law for 46 years. He
has represented consumers in automobile litigation since 1990 and has resolved over 2,000
automobile warranty claims. Attorney Grzeskowiak has been practicing law for 21 years and has
concentrated her practice in automobile litigation since 2000. While the rates charged are slightly
higher than average, they are not so high as to fall outside the realm of reason.
Plaintiff also cites cases in which similar rates have been found reasonable and awarded to
his attorneys in courts throughout Wisconsin. See People Who Care, 90 F.3d at 1312 (noting that
“rates awarded in similar cases are clearly evidence of an attorney’s market rate”). Those cases
include Mercedes-Benz USA, LLC v. Hinkley, Case No. 14-CV-9439 (Milwaukee Cty., Wis. July
7, 2017), in which the court approved an hourly rate for Attorney Megna of $395 for non-trial time
and $415 for trial time, an hourly rate for Attorney Aiken of $450 for non-trial time and $550 for
trial time, an hourly rate for Attorney Grzeskowiak of $345 for non-trial time and $365 for trial
time, and an hourly rate for paralegals of $155; and Klismet’s 3 Squares Inc. v. Navistar, Inc., No.
12-CV-323 (Waupaca Cty., Wis. Sept. 2, 2014), in which the court approved 2014 hourly rates of
$395 per hour for Attorney Megna, $345 per hour for Attorney Grzeskowiak, $400 per hour for
Attorney Aiken, at $155 per hour for paralegal work. Although these rates are slightly lower than
the rates requested, the court takes into consideration reasonable increases in hourly rates over time.
Given that the requested rates are in line with the rates courts have found reasonable as well as the
rates charged by other practitioners, the court concludes that Plaintiff has carried his burden to show
that his attorneys’ hourly rates are reasonable and will award fees based on those proposed rates.
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Second, Defendant argues that the hours billed were unreasonable. As an initial matter,
Defendant takes issue with the number of attorneys involved in the case. It argues that no work was
warranted by Attorney Aiken and that the fees requested for his involvement—$4,336.50 for 8.85
hours of time—should be deducted from Plaintiff’s fee request. Plaintiff argues that he requested
Aiken’s assistance for his experience in cross-examining defense experts at trial in Lemon
Law–related cases, and that Attorney Aiken’s involvement in the case began just weeks before the
trial was scheduled to begin. The court appreciates the desire of Plaintiff to bring in counsel that
is more experienced with cross-examining expert witnesses. But the addition of a third attorney is
unreasonable here, when Plaintiff was represented by a team of two highly experienced attorneys
and when that experience is reflected in the hourly rates charged. In short, the court will deduct the
8.85 hours of Aiken’s time as unnecessary.
Defendant has also cited numerous entries that it deems duplicative or unnecessary due to
overstaffing. It identifies instances in which multiple attorneys attended vehicle inspections, met
with the client and experts, and drafted and reviewed the same documents. The fact that multiple
attorneys collaborated on a case is not, by itself, an indication of duplicative work. See Kurowski
v. Krajewski, 848 F.2d 767, 776 (7th Cir. 1988) (“The use of two (or more) lawyers, which solvent
clients commonly pay for because they believe extra help is beneficial, may well reduce the total
expenditures by taking advantage of the division of labor.”). After reviewing the entries identified
by Defendant, the court concludes that the vast majority of the time entries represent charges for
time that the attorneys reasonably expended on the case. As an initial matter, both Menga and
Grzeskowiak intended to try the case. The complex nature of the vehicle itself and its problems
therefore warranted Menga and Grzeskowiak’s presence at vehicle inspections as well as at
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conferences with the expert and Plaintiff so that they could understand and familiarize themselves
with the vehicle’s deficiencies, its defects, and the expert’s contentions and subsequently present
Plaintiff’s case. See Gatreaux v. Chi. Hous. Auth., 491 F.3d 649, 661 (7th Cir. 2007) (“Use of one
or more lawyer[s] is a common practice, primarily because it often results in more efficient
distribution of work.”). Although Defendant only had one attorney primarily represent it, Plaintiff
had the burden of proof in the case. Moreover, Plaintiff’s counsel would likely have recovered none
of the expenses they incurred and no fee for the time they invested in the case if they did not prevail.
Under these circumstances, it is therefore not unreasonable for Plaintiff’s counsel to take the
additional steps they deemed necessary to successfully prosecute the action. The court concludes
this work was not duplicative.
Defendant also argues that the time expended by two attorneys and a paralegal to complete
the Lemon Law notice and the Rule 26 disclosures was unnecessary. But it is not unreasonable for
a single task to be broken down over several time periods and for a number of individuals to
contribute to the end product. The court does not find these examples cited by Defendant to be
duplicative or otherwise unreasonable.
Finally, the time spent by Plaintiff’s counsel on internal communications regarding strategy
was not duplicative. “The practice of law often, indeed usually, involves significant periods of
consultation among counsel. Talking through a set of authorities or seeking advice on a vexing
problem is often significantly more efficient than one attorney’s trying to wade through the issue
alone.” Tchemkou v. Mukasey, 517 F.3d at 511–12 (7th Cir. 2008). Indeed, having the viewpoint
of more than one attorney may have been beneficial in this case. Plaintiff contends that this case
was not a routine Lemon Law case, as it involved the purchase of a chassis that was converted into
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a heavy-duty truck used to transport milk. That the case did not settle until the eve of trial supports
Plaintiff’s assertion that this case was, in fact, complex. There is nothing inherently unreasonable
about a client retaining multiple attorneys, especially in a complex civil case, and the court finds
that the collaboration of Plaintiff’s counsel was acceptable. The court concludes that a further
reduction in fees is not required.
Defendant next argues that Plaintiff’s counsel engaged in excessive billing for routine or
boilerplate pleadings and discovery. In particular, Defendant contends that the hours spent by
Plaintiff’s counsel in drafting the complaint was excessive. Plaintiff’s counsel billed 11.5 hours for
drafting the initial complaint. Plaintiff maintains that, while pleadings are generally similar in form,
the documents are fact-specific to each case. Again, this case was unique in that it involved a
heavy-duty truck with expensive repair history. As a result, Plaintiff’s counsel was required to
understand the problems with this particular vehicle and evaluate the potential claims that could be
asserted in the initial pleading. The court concludes that the time required in preparing the
complaint was not excessive.
Defendant also challenges the time expended in drafting initial discovery, notices of
deposition, and subpoenas. Plaintiff’s counsel spent 5.2 hours drafting initial discovery to
Defendant and 8.65 hours drafting notices of deposition and subpoenas. Plaintiff indicates that the
problems with his vehicle and its significant repair history made the discovery in the case more
complex. Plaintiff’s counsel was required to engage in substantial research regarding the vehicle’s
distinct problems. Because the vehicle was serviced at several dealerships with several technicians
working on it, Plaintiff’s counsel was also required to depose each individual involved with the
warranty repairs and subpoena the employees of each dealership. Counsel’s argument supports the
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amount claimed for drafting initial discovery, but not the amount of time for drafting notices of
deposition and subpoenas. Though there were multiple individuals deposed, counsel fails to explain
what was so unique about each one or the documents requested that almost nine hours was needed.
The court therefore reduces the time spent preparing deposition notices and subpoenas by three
hours at Attorney Grzeskowiak’s rate of $375 per hour for a reduction of $1,125. The remaining
amount of time spent drafting and reviewing discovery documents in the context of the unique
circumstances surrounding this case was reasonable.
Finally, Defendant complains about the 19.15 hours spent drafting the instant motion for
attorneys’ fees and costs. It argues that the motion is similar to documents filed by Plaintiff’s
counsel in other cases. The court acknowledges that a motion for attorneys’ fees requires an
analysis of the fifteen factors listed in Wis. Stat. § 814.045, an explanation of how each factor
applies in the context of this case, and the gathering of documentation to support the fee request.
The court ultimately agrees that much of the legal argument made here is similar to a previously
filed fee motion in an unrelated case. See Stanley Walter Septic Tank Cleaning, LLC v. Mak Trucks,
Inc., No. 12-CV-00317, ECF No. 85 (E.D. Wis.). The court therefore concludes that a 10%
reduction to the time Grzeskowiak spent drafting the fee motion is appropriate. Accordingly, the
court will deduct 1.41 hours of Grzeskowiak’s time.
Defendant also argues that Plaintiff’s attorneys have improperly charged for administrative
or clerical work. Courts do now allow fees for “those hours expended by counsel ‘on tasks that are
easily delegable to non-professional assistance.’” Spegon v. Catholic Bishop of Chi., 175 F.3d 544,
553 (7th Cir. 1999) (citation omitted); see also Baier v. Rohr-Mont Motors, Inc., 175 F. Supp. 3d
1000, 1025 (N.D. Ill. 2016) (“Courts have recognized that ‘organizing file folders, preparing
documents, copying documents, assembling filings, electronically filing documents, sending
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materials, docketing or “logging” case events into an internal case tracking system, and telephoning
court reporters to be clerical’ tasks for which fees should not be awarded.” (quoting Delgado v. Vill.
of Rosemont, No. 03-C-7050, 2006 WL 3147695, at *2 (N.D. Ill. Oct. 31, 2006))). In multiple
instances, Plaintiff’s attorney and paralegal charged for scheduling, preparing documents, and
scanning documents. Although calendaring deadlines ensures timely compliance with these
deadlines, this is the type of task that should have been delegated. But the remaining time entries
challenged by Defendant are for legal work properly performed by an attorney or paralegal, such
as communicating with the client, reviewing client documents, preparing deposition exhibits,
completing the Lemon Law notice, reviewing the Federal Rules of Civil Procedure, and discussing
trial strategy. The court finds that Plaintiff’s counsel improperly billed $504.75 for clerical work,
and Plaintiff’s fee award will accordingly be reduced by that amount.
Lastly, Defendant claims that the attorneys and paralegal used both 0.10 and 0.25 time
increments to bill in this matter. Plaintiff contends that his attorneys’ regular practice is to bill time
in 0.10 and 0.25 hour increments to ensure precise and accurate billing. The court finds that this
billing practice is not unreasonable.
CONCLUSION
For these reasons, Plaintiff’s motion for attorneys’ fees and costs (ECF No. 38) is
GRANTED-IN-PART and DENIED-IN-PART. Defendant shall pay to Plaintiff the amount of
$289,974.50 in attorneys’ fees and costs. The Clerk is directed to enter judgment accordingly.
SO ORDERED this 5th day of April, 2019.
s/ William C. Griesbach
William C. Griesbach, Chief Judge
United States District Court
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