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noting that "in recognition of the privileged status of the time entries of Plaintiff's counsel, the time sheets involved were not disclosed to the Defendants," who had an opportunity to review the total fees and costs requested
Summary of this case from ResCap Liquidating Tr. v. Primary Residential Mortg., Inc.Opinion
Civ. No. 02-1761 (DWF/RLE).
June 5, 2003.
MINUTE ORDER
I. Introduction
This matter came before the undersigned United States Magistrate Judge pursuant to a general assignment, made in accordance with the provisions of Title 28 U.S.C. § 636(b)(1)(A), upon the Defendants' Joint Motion for Enlargement of Time to Answer and/or Object to Plaintiff's Discovery Requests. A Hearing on the Motions was conducted on May 15, 2003, at which time, the Plaintiff appeared by Kurt J. Niederluecke, Esq., the Defendant Ground Heaters, Inc. ("Ground Heaters"), appeared by James Moskal, Esq., and the Defendant T.H.E. Machine Company ("T.H.E.") appeared by Aaron W. Davis, Esq. For reasons expressed at the close of the Hearing, and further explicated below, we deny the Defendants' Motion for an enlargement of time, and award the Plaintiff reasonable fees and costs in responding to the Motion, pursuant to Rule 37(d), Federal Rules of Civil Procedure.
II. Factual Background
On February 14, 2003, the District Court, the Honorable Donovan W. Frank presiding, heard argument on the parties' Cross Motions for Summary Judgement, and took the Motions under advisement. The Defendants contend that an accord was reached whereby the parties agreed to stay discovery pending the District Court's disposition of those Motions. The Plaintiff denies that any agreement to stay discovery was reached.
The Record shows that, on March 5, 2003, the Plaintiff person-ally served Document Requests and Interrogatories upon the Defendants which required responses by no later than April 4, 2003. See, Rules 33 and 34, Federal Rules of Civil Procedure. One day after the service of the Plaintiff's written discovery requests, counsel for T.H.E. transmitted a letter to Plaintiff's counsel claiming that the parties had agreed to a stay, but Plaintiff's counsel responded that no such agreement was reached, and encouraged T.H.E. to timely file responses or risk a waiver of any pertinent legal objections. As to Ground Heaters, its counsel e-mailed counsel for the Plaintiff, on April 1, 2003, also advising that a stay agreement had been reached. Both T.H.E., and Ground Heaters, have expressed a recollection that, at the Summary Judgment Hearing, one of the attorneys advised the District Court that a stay of discovery had been agreed upon but, notwithstanding assurances, that a transcript of that Hearing had been ordered and would substantiate that recollection, no such evidentiary showing has been made to date. On this Record, the communications of counsel amply belie any agreement to stay discovery. Even if such an agreement had been reached, when the Defendants were served with discovery, notwithstanding the purported agreement, we find it disconcerting that they did not approach the Court for relief from answering discovery which, ostensibly, traversed an agreement that is said to have been reached.
As the Plaintiff accurately observes, Rules 29, and 34, Federal Rules of Civil Procedure, require that any agreement to stay discovery be reduced to writing. See, e.g., Pescia v. Auburn Ford-Lincoln Mercury Inc., 177 F.R.D. 509, 510 (M.D. Ala. 1997), citing, Rule 29, Federal Rules of Civil Procedure. No such written agreement has been disclosed here.
Thereafter, on April 4, 2003 — the last day for timely responses — the Defendants jointly filed the Motion now before the Court.
III. Discussion
While the Defendants style their Motion as one for an "Enlargement of Time to Answer and/or Object to Plaintiff's Discovery Requests," the Motion is, in practical effect, designed to stay discovery pending the District Court's disposition of the Cross-Motions for Summary Judgment. We conclude, based upon the arguments of counsel, and the Record presented, that the Defendants have resorted to a most wasteful exercise in order to secure a stay in discovery that eluded the parties' mutual agreement. We are sufficiently concerned about the gamesmanship employed by the Defendants as to warrant the imposition of appropriate sanctions.
The Defendants argue that their Motion is meritorious under Rule 6(b)(1), Federal Rules of Civil Procedure, which provides, in part, as follows:
When by these rules * * * an act is required or allowed to be done at or within a specified time, the court for good cause shown may at any time in its discretion with or without motion or notice order the period enlarged if request therefor is made before the expiration of the period originally prescribed.
According to the Defendants, "[t]he cause [they] have shown in this situation is that discovery should be stayed until the dispositive motions have been ruled on by Judge Frank." Apart from this recital, the Defendants offer no showing of good cause to stay discovery. See, Rule 16(b), Federal Rules of Civil Procedure ("A schedule shall not be modified except upon a showing of good cause.").
The Defendants suggest that, by seeking a stay of discovery, they are attempting to control the costs of litigation. We are not so persuaded. While an effort to control excessive litigation costs is to be endorsed, the Defendants offer nothing to suggest that their election to ignore the Plaintiff's discovery would accomplish that result. If, as the Defendants now proclaim, justice required the type of stay that they now seek, we find it implausible that they would not have earlier sought Court intervention to accomplish that result. Rather, they have resorted to a wasteful form of self-help so as to secure a significant delay in discovery during the time in which their Motion could be heard. Even at this late date, the Defendants' Motion papers are short on any showing of cause to modify the discovery deadline in this case.
At the initial Pretrial Conference, counsel were encouraged to employ this Court's opendoor policy so as to secure timely Court intervention. Plainly, securing an expeditious ruling on their interest in a stay of discovery, was not consistent with their resort to a delaying tactic.
Absent a cogent showing of cause to modify the discovery deadline, the Defendants Joint Motion for that relief is denied. While the game-playing of the Defendants has substantially burdened the Plaintiff, and upon this Court, we decline to adopt the Plaintiff's request that the Defendants be stripped of their objections to the Plaintiff's discovery requests. We are engaged, here, in the search for the truth, and the arbitrary creation of evidence, through a Court-imposed waiver, should be reserved for the most serious of transgressions. Here, the Plaintiff has been needlessly required to respond to a Motion that was thoroughly without merit, and the Defendants, jointly and severally, should bear the unnecessary costs, and expenses, for the Plaintiff's response, which were reasonably incurred by the Plaintiff.
At the close of the Hearing, we directed the Defendants to respond to the Plaintiff's discovery requests by no later than fourteen (14) days after the date of the Hearing. We reaffirm that ruling, and note that the date for compliance has passed, and the Plaintiff has not complained of any noncompliance on the part of either Defendant.
While we impose sanctions pursuant to our general power to control the discovery process, we underscore that, in our view, the Defendants conduct came perilously close to justifying an award of sanctions under Title 28 U.S.C. § 1927, or Rule 11(b)(1), Federal Rules of Civil Procedure. Here, given the totality of the circumstances, we find a discovery sanction to be most appropriate.
At the Hearing, we requested counsel for the Plaintiff to submit an Affidavit, for our review, which sets forth the reasonable fees and costs incurred. Counsel provided the Court with an Affidavit listing the number of hours spent preparing for the Defendants' Motion, along with a description of the activities involved. Counsel has averred that a total of 22.65 hours were expended in preparing for the Plaintiff's responsive papers, 17.65 of which were billed out at a rate of $240.00 an hour, and 5.0 of which were billed at a rate of $225.00 an hour, for a total of $5,361.00. Counsel also represents that it incurred an additional $361.60 for duplicating costs, delivery of responsive pleadings, and on-line legal research.
Consistent with the leave we afforded to them, the Defendants had an opportunity to review the total fees and costs being requested although, in recognition of the privileged status of the time entries of Plaintiff's counsel, the time sheets involved were not disclosed to the Defendants. Following that review, the Defendants lodged an objection to the imposition of any attorneys' fees — an objection we reject as unsound — and also object to the amount of fees that the Plaintiff asks to be awarded, advising that an expenditure of 22.65 hours in the preparation of responsive papers is inordinate, and that Plaintiffs' counsel was not required by the legal issues to incur $300.00 in computerized legal research. We agree with the Defendants that the Plaintiff's fee, and cost reimbursement request, is not reasonable.
At the outset, we note that a "district court is vested with significant discretion in determining a `reasonable fee.'"Paschall v. Kansas City Star Co., 695 F.2d 322, 337 (8th Cir. 1982), citing, International Travel Arrangers, Inc. v. Western Airlines, Inc., 623 F.2d 1255, 1274 (8th Cir. 1980), cert. denied, 449 U.S. 1063 (1980). "The most useful starting point for determining the amount of a reasonable fee is the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate." Hensley v. Eckerhart, 461 U.S. 424, 433 (1983); see also, West v. Aetna Life Ins. Co., 188 F. Supp.2d 1096 (N.D. Iowa 2002). "A reasonable hourly rate is one `in line with those prevailing in the community for similar services by lawyers of reasonable comparable skill, experience, and reputation.'" Knoeffler v. Town of Mamakating, 126 F. Supp.2d 305, 310 (S.D.N.Y. 2000), quoting, Blum v. Stenson, 465 U.S. 886, 895 n. 11 (1984).
While we find that the hourly rates charged by Plaintiff's counsel to be in line with the reasonable rates that prevail in this community for legal work of like kind, an expenditure of 22.65 hours on responsive papers is grossly excessive. The Plaintiff's responsive Memorandum comprised only eight (8) pages and, given the simplicity of the legal issues, contains little in the way of authoritative citation. We find that a total expenditure of 10 hours would be wholly sufficient to read the Defendants' Motion papers — only one Memorandum was jointly filed by the Defendants — to complete any necessary research, to prepare an eight page responsive brief, and to attend the telephonic Hearing in this matter. Multiplying 10 hours times the $240 per hour rate charged by the attorney who argued on behalf of the Plaintiff, produces a total fee of $2,400.00 which, under the circumstances, we find to be reasonable. As to costs, the duplicating costs of $25.38 are not opposed by the Defendants, and we find those costs reasonable and reimbursable. With respect to costs incurred in delivering the Plaintiff's responsive brief, we regard the election to employ messenger services for this purpose to be unnecessary, and further regard the requisite postage to transmit the responsive brief by mail to be an ordinary, and non-reimbursable cost of doing business. Lastly, in this Circuit, "computer based research must be factored into the attorneys' hourly rate, hence the cost of the computer may not be added to the fee amount." Standley v. Chilhowsee R-IV School Dist., 5 F.3d 319, 325 and n. 7 (8th Cir. 1993), citing Leftwich v. Harris-Stowe State College, 702 F.2d 686, 695 (8th Cir. 1983); see also, Parke v. First Reliant Standard Life Ins. Co., 2003 WL 131731 at * 4 (Minn., January 8, 2003); Ryther v. KARE 11, 864 F. Supp. 1525, 1534 (Minn. 1994). Accordingly, we allow as costs, only the duplicating expenses, thereby producing a total award of fees and costs in the amount of $2,425.38, which is to be paid by the Defendants forthwith.
We regard an equal division, between the Defendants, to be an equitable allocation of the fee and cost award. Nevertheless, we are not positioned to know whether agreements, between the Defendants, would more accurately distribute the sanction of advancing a meritless Motion, and we leave to the Defendants, in the first instance, with such an allocation.
NOW, THEREFORE, It is —
ORDERED:
1. That the Defendants' Joint Motion for Enlargement of Time to Answer and/or Object to Plaintiff's Discovery Requests [Docket No. 75] is DENIED.
2. That the Defendants are directly to pay the Plaintiff, the sum of $2,425.38, as and for his reasonable costs and attorneys' fees, which the Plaintiff incurred in responding to the Defendants' meritless Joint Motion.