Summary
finding $300 per hour as a reasonable rate for FDCPA case where offer of judgment was accepted early on by defendants
Summary of this case from Recca v. Asset Maximization Grp., Inc.Opinion
No. 12 Civ. 5044 (RJS)
07-31-2013
VIRGINIA RUIZ Plaintiff, v. MAIDENBAUM & ASSOCIATES P.L.L.C. Defendant.
Plaintiff is represented by Kevin C. Mallon of Fishman & Mallon, LLP, 305 Broadway, Suite 900, New York, New York 10007. Defendant is represented by Marian C. Rice and Matthew J. Bizzaro of L'Abbate, Balkan, Colavita & Contini, L.L.P., 1001 Franklin Avenue, Garden City, New York 11530.
MEMORANDUM AND ORDER :
Virginia Ruiz ("Plaintiff") commenced this action against Maidenbaum & Associates P.L.L.C. ("Defendant"), alleging that Defendant violated the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692. On January 17, 2013, Plaintiff notified the Court that it had formally accepted Defendant's Offer of Judgment, pursuant to Federal Rule of Civil Procedure 68, which included an agreement by Defendant to pay Plaintiff reasonable attorneys' fees and costs. The parties were unable to agree on these amounts. Now before the Court is Plaintiff's motion for the Court to award Plaintiff's counsel $7,840 in attorneys' fees and $465 in costs. For the reasons set forth below, the Court awards Plaintiff's counsel $6,860 in attorneys' fees and $465 in costs.
I. BACKGROUND
On June 27, 2012, Plaintiff commenced this action against Defendant, alleging it violated the FDCPA by seeking to collect a debt that Plaintiff did not owe as well as by seeking an unauthorized sum of $400 in collection fees. (Doc. No. 1.) Defendant filed its answer on November 26, 2012, denying each allegation in Plaintiff's Complaint. (Doc. No. 9.) At an initial conference held on December 21, 2012, the Court set a schedule for discovery. (Doc. No. 11.) Shortly thereafter, on January 17, 2013, Plaintiff notified the Court that she had formally accepted Defendant's Offer of Judgment pursuant to Federal Rule of Civil Procedure 68. (Doc. No. 12.) In its offer, Defendant agreed to pay Plaintiff $1,001 in damages, as well as "the costs of the within action attributed to the claims against [Defendant], together with reasonable attorneys' fees incurred in the prosecution of the claims asserted against [Defendant]." (Doc. No. 12.)
The facts set forth herein are undisputed. In deciding this motion, the Court considered the following submissions: Plaintiff's Memorandum of Law ("Pl.'s Mem."), Defendant's Memorandum of Law ("Def.'s Mem."), Plaintiff's Reply Memorandum of Law ("Pl.'s Reply"), and the various exhibits and declarations attached thereto.
In a letter dated March 8, 2013, Plaintiff notified the Court of the parties' inability to agree with respect to attorneys' fees and costs. (Doc. No. 15.) Plaintiff filed her motion on March 18, 2013, requesting an award of $6,300 in fees (based on eighteen hours of work at an hourly rate of $350 by her attorney, Kevin Mallon ("Mallon")), and $465 in costs. (Pl.'s Mem. 1.) Defendant filed its opposition brief on April 10, 2013, requesting that the Court calculate Mallon's fees based on an hourly rate of $200, reduce the number of hours for which he is compensated, and only award $350 in costs. (Def.'s Mem. 8, 12.) On April 17, 2013, Plaintiff submitted a reply memorandum, which addressed the arguments in Defendant's brief and requested a higher award of $7,840 in fees to account for the additional 4.4 hours that Mallon spent on the reply memorandum. (Pl.'s Reply 6.)
II. LEGAL STANDARD
In its Arbor Hill decision, the Second Circuit set forth the method for determining reasonable attorneys' fees. Arbor Hill Concerned Citizens Neighborhood Ass'n v. Cnty. of Albany, 522 F.3d 182 (2d Cir. 2008). Under this approach, the Court must first set a "reasonable hourly rate" for each attorney and staff member. Id. at 190. Next, the Court must determine the number of hours reasonably expended. Id. Finally, the Court must multiply the reasonable hourly rate by the number of hours reasonably expended to determine the "presumptively reasonable fee." Id.; see also Margolies v. Cnty. of Putnum N.Y., No. 09 Civ. 2061 (RKE) (GAY), 2011 WL 721698, at *1 (S.D.N.Y. Feb. 23, 2011). Courts may adjust the presumptively reasonable fee based on "case-specific variables," such as "the complexity and difficulty of the case," "the resources required to prosecute the case effectively," and "the timing demands of the case." Arbor Hill, 522 F.3d at 184.
The burden is on the party seeking attorneys' fees to establish entitlement to an award and to submit sufficient evidence to support the hours worked and the rates claimed. See Hensley v. Eckerhart, 461 U.S. 424, 437 (1983). Accordingly, "[t]he applicant should exercise billing judgment with respect to hours worked, . . . and should maintain billing time records in a manner that will enable a reviewing court to identify distinct claims." Id.
Pursuant to Federal Rule of Civil Procedure 54(d)(1), taxable costs "should be allowed to the prevailing party." Fed. R. Civ. P. 54(d)(1). The term "costs," as used in Rule 54, is defined in 28 U.S.C. § 1920 and Local Rule 54.1 as including the costs of transcripts, depositions, witness fees, printing, copying, and the like. Moreover, where statutes provide for the shifting of attorneys' fees, awards may "include those reasonable out-of-pocket expenses incurred by attorneys and ordinarily charged to their clients." Amaprop Ltd. v. Indiabulls Fin. Servs. Ltd., No. 10 Civ. 1853 (PGG), 2011 WL 1002439, at *9 (S.D.N.Y. Mar. 16, 2011). As such, plaintiffs may recover "[i]dentifiable, out-of-pocket expenses," but not "non-recoverable, routine office overhead." Kuzma v. I.R.S., 821 F.2d 930, 933-34 (2d Cir. 1987); see also Settlement Funding, LLC v. AXA Equitable Life Ins. Co., No. 09 Civ 8685 (HB), 2011 WL 2848644, at *1, *4 (S.D.N.Y. July 18, 2011) (awarding costs for trial graphics and video deposition); Bellifemine v. Sanofi-Aventis U.S. LLC, No. 07 Civ. 2207 (JGK), 2010 WL 3119374, at *7 (S.D.N.Y. Aug. 6, 2010) (awarding costs for filing fees, electronic discovery services, copies, mailing, and travel).
III. DISCUSSION
A. Reasonable Hourly Rate
A reasonable hourly rate is the rate a paying client would be willing to pay his attorney. Arbor Hill, 522 F.3d at 190. To determine this rate, the Supreme Court has directed courts to look to "the prevailing market rates in the relevant community." Blum v. Stenson, 465 U.S. 886, 895 (1984); see also Simmons v. N.Y.C. Transit Auth., 575 F.3d 170, 184 (2d Cir. 2009) (instructing courts to apply a "forum rule," i.e., to "use the hourly rates employed in the district in which the reviewing court sits in calculating the presumptively reasonable fee") (internal quotation marks omitted). Courts should also "bear in mind that a reasonable, paying client wishes to spend the minimum necessary to litigate the case effectively" and "that such an individual might be able to negotiate with his or her attorneys, using their desire to obtain the reputational benefits that might accrue from being associated with the case." Arbor Hill, 522 F.3d at 190. In evaluating these factors, courts may rely on "[their] own knowledge of comparable rates charged by lawyers in the district," Morris v. Eversley, 343 F. Supp. 2d 234, 245 (S.D.N.Y. 2004), as well as on evidence provided by the parties, Merck Eprova AG v. Gnosis S.P.A., No. 07 Civ. 5898 (RJS), 2013 WL 364213, at *1 (S.D.N.Y. Jan. 31, 2013).
The Southern District has noted that "the determination of a reasonable hourly rate is far from an exact science." E.g., Garcia v. Giorgio's Brick Oven & Wine Bar, No. 11 Civ. 4689 (LLS) (FM), 2012 WL 3339220, at *7 (S.D.N.Y. Aug. 15, 2012) (adopted by Garcia v. Giorgio's Brick Oven & Wine Bar, No. 11 Civ. 4689 (LLS), 2012 WL 3893537, at *1 (S.D.N.Y. Sept. 7, 2012) (awarding an hourly rate of $350 to plaintiff's attorney who had thirteen years of experience in a Fair Labor Standards Act case)). Accordingly, there is no a bright line rule to dictate the hourly rate in any particular case. Instead, courts balance variables such as experience, complexity of the case, firm size, and subject matter.
Plaintiff's attorney, Mallon, is a partner at a small litigation firm and has over thirteen years of legal experience. (Mallon Decl. ¶¶ 1, 6.) Mallon seeks fees at an hourly rate of $350. (Pl.'s Mem. 1.) Defendant contends that this hourly rate should be reduced to $200 because it is in excess of the rate awarded in this District under comparable circumstances. (Def.'s Mem. 1, 5-8.) The Court finds that an hourly rate of $300 - slightly below Plaintiff's proposed hourly rate of $350 - is reasonable in light of two factors: (1) the range that this District has awarded to similarly situated litigators in the past and (2) the rates Mallon's previous clients have agreed to pay in similar cases.
In his Declaration, Mallon states that he is "a member of Fishman & Mallon, LLP." (Decl. of Kevin Mallon, dated Mar. 18, 2013 ("Mallon Decl."), ¶ 1.) The firm's website affirms the Court's understanding that by "member," Mallon means that he is a partner at the firm. Our Team: Attorneys: Kevin Mallon, Fishman & Mallon, LLP (June 21, 2013), http://www.nyctenantslaw.com/staff/kevin-mallon/.
First, $300 per hour is consistent with this District's previous awards for attorneys with comparable experience. "In this District, courts have found attorneys' fees ranging from $225 to $375 reasonable for civil litigators working in small firms." Dunn v. Advanced Credit Recovery Inc., No. 11 Civ. 4023 (PAE) (JLC), 2012 WL 676350, at *6 (S.D.N.Y. March 1, 2012) (adopted by Dunn v. Advanced Credit Recovery Inc., No. 11 Civ. 4023 (PAE), 2012 WL 1114335, at *1 (S.D.N.Y. April 3, 2012)). For instance, in Dunn, the court awarded an hourly rate of $300 in an FDCPA case to two attorneys, one with approximately fifteen years' experience and the other with twenty-five. Id. Similarly, in Ryan v. Allied Interstate, Inc., 882 F. Supp. 2d 628 (S.D.N.Y. 2012), the court awarded plaintiff's counsel, a firm partner with over two decades of legal experience, an hourly rate of $300 in an FDCPA case. 882 F. Supp. 2d at 630.
The Court notes that the highest end of this fee spectrum tends to be populated by cases involving more complex issues than those that appear in the instant one. See, e.g., LV v. N.Y.C. Dep't. of Educ., 700 F. Supp. 2d 510, 518-19 (S.D.N.Y. 2010) (awarding counsel $375 per hour in a complex class action suit).
Second, though Mallon usually takes consumer cases on a contingent basis, two clients have recently retained him on an hourly basis at comparable rates. (Mallon Decl. ¶ 12.) On October 23, 2010, one client paid Mallon an initial retainer of $2,850 and agreed to an hourly rate of $300 for his services in a Fair Credit Reporting Act case. (Id., Ex. E.) On March 7, 2013 - one day prior to Plaintiff notifying the Court of the parties' inability to agree with respect to attorneys' fees and costs in this case - another client agreed to pay Mallon a $350 hourly rate with an initial retainer of $5,500 in a FDCPA action. (Id.) These examples further support the reasonableness of a $300 per hour fee. See Arbor Hill, 522 F.3d at 190 ("The reasonable hourly rate is the rate a paying client would be willing to pay.").
Defendant argues that any payment to Mallon by past clients is irrelevant and, instead, that the Court should use the "least sophisticated consumer" standard to determine the appropriate hourly rate to award Mallon. (Def.'s Mem. 8.) Defendant does not elaborate on why that standard, which pertains to liability in FDCPA cases and not attorneys' fees, should control. Easterling v. Collecto, Inc., 692 F.3d 229, 233 (2d Cir. 2012) (stating that the least sophisticated consumer standard is used to determine whether a debt collection letter is "false, deceptive, or misleading" under the FDCPA). Accordingly, the Court rejects this argument and, for the reasons stated above, holds that an hourly rate of $300 is reasonable.
B. Hours Reasonably Expended
The Court must next determine the number of hours that counsel reasonably expended. In reviewing the submitted timesheets for reasonableness, the Court relies on its own familiarity with the case, as well as on its experience with the parties' evidentiary submissions and arguments. See Lucky Brand Dungarees, Inc. v. Ally Apparel Res., LLC, No. 05 Civ. 6757 (LTS) (MHD), 2009 WL 466136, at *1 (S.D.N.Y. Sept. 18, 2012). The Court is then tasked with subtracting those hours that are "excessive, redundant, or otherwise unnecessary," see Robinson v. City of New York, No. 05 Civ. 9545 (GEL), 2009 WL 3109846, at *5 (S.D.N.Y. Sept. 29, 2009) (internal quotation omitted), with the guiding inquiry being "whether 'at the time the work was performed, a reasonable attorney would have engaged in similar time expenditures.'" Id. (quoting Grant v. Martinez, 973 F.2d 96, 99 (2d Cir. 1992)).
Counsel submitted timesheets ("Time Entry Report") demonstrating that he spent a total of 22.4 hours prosecuting this action, including the time spent drafting the reply to this motion. (Mallon Decl., Ex. A; Supp. Decl. of Kevin Mallon, dated Apr. 17, 2013, Doc. No. 26 ("Supp. Mallon Decl."), Ex. A; Pl.'s Reply 6.) Defendant contests this number, challenging certain entries in Mallon's Time Entry Report as "excessive" and "duplicative." (Def.'s Mem. 9.) The Court agrees with this contention.
Defendant also argues that the Court should strike portions of Mallon's Time Entry Report because they reflect hours spent addressing claims that are "unfounded and lack merit." (Def.'s Mem. 11.) However, Defendant relinquished the opportunity to contest the merits of Plaintiff's claims in the instant case when it made an Offer of Judgment to resolve those claims.
Defendant also argues that Mallon, in his initial memorandum, improperly referred to confidential settlement communications between himself and Defendant. (Def's Mem. 3-5.) Defendant maintains that such references violate Federal Rule of Evidence 408 and should thus be disregarded by the Court. Id. The Court does not find this argument persuasive. Settlement is an important part of an attorney's work on a case, and time spent on such efforts is compensable. Rule 408 is designed to encourage settlement by protecting conduct or statements made as part of settlement negotiations from being used against a party; it does not prohibit an attorney from being compensated for the time that he spends working to settle a case. Indeed, Defendant cites no authority to the contrary.
The time that Mallon allegedly spent working on his initial memorandum of law is "excessive." (Def.'s Mem. 9-10.) Mallon reports spending 4.3 hours researching, drafting, and editing the memorandum. (Mallon Decl., Ex. A.) However, the memorandum is barely five pages long, and only three of those pages involve legal analysis. (Pl.'s Mem. 1-5.) The quality is equally lacking. Mallon does not provide much relevant case law from this District or from the Second Circuit to demonstrate that his proposed hourly rate of $350 aligns with the rate that comparable attorneys in this District generally earn. The cases that Mallon does cite primarily relate to the well-established proposition that an attorneys' fees award may exceed the plaintiff's recovery in a civil rights case - hardly a novel proposition and one not disputed here. Yet, even a large portion of those cases are not from courts within this Circuit. Given the content, the number and relevance of the legal citations, and the typographical errors in this initial memorandum, the Court cannot conclude that Mallon reasonably spent over four hours researching, drafting, and editing it. Therefore, the Court finds it appropriate to reduce the number of hours that Mallon allegedly spent on the initial memorandum from 4.3 to 1.5.
In contrast to Plaintiff's initial memorandum, Plaintiff's reply memorandum does include case law from this District to support counsel's proposed rate (Pl.'s Reply 3-4) and, overall, includes a more thorough and on-point analysis of the relevant issues. This discrepancy underscores the deficiencies of the initial memorandum.
However, the Court is not persuaded by Defendant's other challenges to Mallon's hours. First, the Court finds it reasonable that Mallon would spend twenty-four minutes to review Federal Rule of Civil Procedure 68 and, presumably, surrounding case law in preparation of his memorandum in the instant case. Second, the Court rejects Defendant's objection to two entries in which Mallon reviewed "client docs," once with respect to "FDCPA claims and SOL" and the other "in preparation for drafting complaint." (Def.'s Mem. 11; Mallon Decl., Ex. A.) An attorney's decision to go over case-related documents for a second time prior to drafting a complaint is entirely reasonable.
Accordingly, the Court reduces Mallon's total billed hours from 22.4 to 19.6. At an hourly rate of $300, this reduction produces a total attorneys' fees award of $5,880.
B. Costs
Plaintiff seeks $465 in costs: $350 for the filing fee to commence this action and $115 to serve the Summons and Complaint on Defendant. (Pl.'s Mem. 1; Def.'s Mem. 12.) Defendant does not take issue with the former, but argues that $115 for service of process is "excessive." (Def.'s Mem. 12.) Specifically, Defendant focuses on the geographical proximity between the process server that Plaintiff hired and the location where Defendant was served, arguing that the short distance between the two - approximately three miles - does not justify the $115 cost. (Id.) However, Plaintiff's request for reimbursement of these costs is reasonable and in line with common practice in this District, which consistently awards costs for service of process. See, e.g., U.S. Engine Prod., Inc. v. AGCS Marine Ins. Co., 783 F. Supp. 2d 507, 509 (S.D.N.Y. 2011) (awarding plaintiff "attorneys' fees plus an additional $572 for costs incurred in connection with service of process"). Accordingly, the Court finds that Mallon's proposed costs of $465 are reasonable and should be awarded.
IV. CONCLUSION
For the foregoing reasons, the Court concludes that Plaintiff is entitled to attorneys' fees at a rate of $300 per hour and costs in the amount of $465. Because the Court finds that the number of billed hours is excessive, the Court reduces the total number from 22.4 to 19.6. Thus, the Court awards Plaintiff $5,880 in attorneys' fees and $465 in costs.
The Clerk of Court is respectfully directed to terminate the motion pending at docket number 18 and to close this case. SO ORDERED.
/s/_________
RICHARD J. SULLIVAN
United States District Judge Dated: July 31, 2013
New York, New York
* * *
Plaintiff is represented by Kevin C. Mallon of Fishman & Mallon, LLP, 305 Broadway, Suite 900, New York, New York 10007.
Defendant is represented by Marian C. Rice and Matthew J. Bizzaro of L'Abbate, Balkan, Colavita & Contini, L.L.P., 1001 Franklin Avenue, Garden City, New York 11530.