Opinion
CIVIL ACTION NO. 02-8471
October 8, 2003
ORDER AND OPINION
Plaintiff Edward Ezekian here seeks counsel fees under the Pennsylvania Wage Payment and Collection Law, ("WPCL"), 43 P.S. § 260.1 et seq. For the reasons set forth below, I award him counsel fees in the amount of $11,392, and costs in the amount of $389.37 for a total award of $11,790.72.
II. Factual and Procedural Background
In this binding arbitration, Edward Ezekian sought commissions he claimed were owed him by his former employer, Anacomp, Inc. Primarily, Ezekian argued that he was owed a $62,500 commission on a transaction involving the BISYS Corporation. He argued that Anacomp terminated him immediately after the BISYS contract was signed, in order to avoid paying him. Ezekian also sought five much smaller commissions on transactions other than BISYS. He asserted claims under an alleged implied contractual covenant of good faith and fair dealing, and under the WPCL.
On July 10, 2003, I issued my binding decision and award. I found in favor of Anacomp on the BISYS claim, and on four of the five other commissions. However, I found that Ezekian was entitled to recover a $3,500 commission on a sale to Asplundh Tree Expert Co. At trial, Ezekian testified that he had not been paid this commission because, through Anacomp's clerical error, Asplundh was not billed until the month after Ezekian left Anacomp. Anacomp did not dispute this. Based on his success on the Asplundh claim, Ezekian seeks an award of $30,200.00 in attorney's fees and $973.43 in costs for a final award of $31,173.43.
III. Legal Standards
The WPCL provides a statutory remedy for an employer's breach of its contractual obligation to remit wages. It permits a successful plaintiff to obtain an award of attorney's fees:
The court in any action brought under this section shall, in addition to any judgment awarded to the plaintiff or Plaintiff's, allow costs for reasonable attorney's fees of any nature to be paid by the defendant.43 P.S. § 260.9a(f). An award of attorney's fees under this section has been held by the Pennsylvania courts to be mandatory. Oberneder v. Link Computer Corp., 674 A.2d 720 ( Pa. Super. 1996), aff'd 696 A.2d 148 (Pa. 1997).
Although the Pennsylvania courts have not spoken on the preferred method for determining a fee award under the WPCL, federal courts (including this Court) have used the "lodestar" approach. Bandy v. LG Industries. Inc., Civ. A. No. 02-7359, 2003 WL 22100876 (E.D. Pa. Jul. 23, 2003); Clarke v. Whitney. 3 F. Supp.2d 631 (E.D. Pa. 1998).
The lodestar is a computation of the reasonable hourly rate for legal services multiplied by the number of hours reasonably expended by the attorney. Hensley v. Eckherhart. 461 U.S. 424, 433 (1983). It produces a presumptively reasonable calculation of attorney's fees. Washington v. Philadelphia County Court of Common Pleas. 89 F.3d 1031, 1035 (3d Cir. 1996); Clarke v. Whitney, supra. The party petitioning for attorney's fees has the burden of showing that the fees and costs sought are reasonable. Clarke v. Whitney,supra, at 633.
Then, as the Honorable J. Curtis Joyner explained in Clarke:
The opposing party may object to the lodestar calculation, calling into question either the reasonableness of the hourly rate requested or the reasonable hours expended. In objecting to the reasonable hours expended, the opposing party may request a reduction of the lodestar on the grounds that, inter alia, the hours expended on the litigation were excessive, redundant, or unnecessary. Hensley. 461 U.S. at 434. Further the court can reduce the number of hours expended on "litigating claims on which the party did not succeed and that were `distinct in all respects from' claims on which the party did succeed." Rode [v. Dellarciprete. 892 F.2d 1177, 1183 (3d Cir. 1990)].3 F. Supp.2d at 633-634.
The lodestar amount may also be downwardly adjusted to account for time expended litigating unsuccessful claims if the plaintiff was only partially successful in the underlying litigation. Hensley at 461 U.S. at 434-437; Minnick v. Dollar Financial Group. Inc., Civ. A. No. 02-1291, 2002 WL 1023101 at *8 (E.D. Pa. May 20, 2002):
This adjustment is not meant to maintain any ratio or proportionality between the amount of damages and attorney's fees, but, rather, to assure that fees are awarded only to the extent that the litigant was successful. See Washington v. Philadelphia County Court of Common Pleas. 89 F.3d 1031, 1042 (3d Cir. 1996). The amount of this downward adjustment can be determined in two ways: the "district court may attempt to identify specific hours that should be eliminated, or it may simply reduce the award to account for the limited success. The court necessarily has discretion in making this equitable judgment." Hensley. 461 U.S. at 436-37.Minnick. supra.
III. Discussion
Anacomp has not objected to Ezekian's counsel's hourly rate of $200.00. However, it argues for a pre-lodestar reduction in the number of hours claimed on the basis that the inadequacy of counsel's record keeping precludes an accurate evaluation of the time expended. Anacomp argues that this would reduce the lodestar in this case from $30,200 to $25,440.
Anacomp also argues for a 75% downward adjustment of the lodestar figure, and of the costs claimed, to take account of (a) the fact that Ezekian's counsel obtained only a very partial success, and (b) the fact that Ezekian refused several times to consider Anacomp's settlement offers. It proposes a final combined award of fees and costs in the amount of $6,603.00, "which is nearly 90% more than the total Ezekian was ultimately awarded." Anacomp's Memorandum of Law in support of its Opposition at 24.
A. Pre-Lodestar Adjustments
Specifically, Anacomp has objected to payment for time-sheet entries where the description is so vague that it cannot be determined whether the work was connected in any way to the Asplundh claim. Many of these read: "research on employment issues."
Anacomp points to Contractor's Association of Eastern Pennsylvania. Inc. v. City of Philadelphia. Civ. A. No. 89-2737, 1996 WL 355341 (E.D. Pa. Jun. 20, 1996), where the Honorable Louis Bechtle observed that a party which knew it would be filing a fee petition could be expected to offer more than general descriptions:
The entries of the types described above . . . cannot serve as a reliable tool for the court to use, and consequently cannot be allowed. For the court to be satisfied with less than the minimum detail expected here is not only contrary to the legal standard, but creates a temptation, for even the most well-meaning person, to merely gloss over a faded memory and simply generalize expenses with court approval, when in fact the entries are of no help to the court.
1996 WL 355341 at *8.
I agree with Judge Bechtle's reasoning, and will eliminate from Ezekian's claim hours described as devoted to "research on employment issues" and the like. However, I will not completely eliminate the entries for October 18, 2002, October 28, 2002, November 8, 2002, December 6, 2003, and June 17, 2003, where this vague language is combined with more specific descriptions such as "Research on Anacomp's move to Allentown, Pennsylvania and its effect on Ezekian's employment status." Since it appears that the time was spent on a mixture of activities, I will simply halve those time entries.
Anacomp has also objected to entries where the contemporaneous time sheet provides no description of the work performed, although Ezekian has provided one in his petition, based on "other information contained in the file." However, there is no reason to believe that Ezekian's after-the-fact descriptions are inaccurate. Therefore, I will leave in entries where Ezekian has provided only an after-the-fact description, where the description is sufficiently specific. These include the December 11, 2002, December 13, 2002, January 20, 2003, February 7, 2003 and April 17, 2003, entries.
My actions, as described above, provide for a reduction of 8.6 hours, rather than the 23.8 for which Anacomp has argued. They result in a pre-lodestar reduction of $1,720. Therefore, the lodestar is reduced from $30,200 to $28,480.
B. The Post-Lodestar Adjustment To Account For Limited Success
Anacomp is correct in arguing that a substantial reduction of the lodestar figure is appropriate to account for Ezekian's very limited degree of success in this case. Since attorney's fees need not be proportionate to the amount of judgment, the amount of Ezekian's award is not important in itself. See Washington v. Philadelphia County Court of Common Pleas. 89 F.3d 1031, 1042 (3d Cir. 1996). However, as an indicator of Ezekian's degree of success, it is notable that he sought to recover $71,644 in unpaid commissions on five different accounts, (one of which was $62,500), and statutory liquidated damages under the WPCL of $17,911, for a total recovery of $89,555. Instead, he recovered only $3,500 on one account. In monetary terms, then, Ezekian was only about 4% successful.
Anacomp has pointed to other indicators of the minimal place that the Asplundh claim held in this matter. Out of fourteen interrogatories Ezekian served on Anacomp, only one pertained to Asplundh, and that only in combination with the four other small claims: "Identify all commissions paid and to whom they were paid with respect to the five transactions described in paragraph 14 of Plaintiff s Complaint [which included Asplundh." Exhibit B to Anacomp's Opposition to Ezekian's Fee Petition. Similarly, only one out of 34 requests for production of documents requested: "All documents relating to commissions paid or payable by Defendant, Anacomp, Inc., with respect to the five transactions described in paragraph 14 of Plaintiff s Complaint." Id.
Moreover, the index to Ezekian's deposition of Roger Berger, Ezekian's manager, indicates that the word "Asplundh" was mentioned only twice, both mentions recorded on a single page of a transcript of over 90 pages. Exhibit C to Anacomp's Opposition. BISYS, by contrast, was mentioned numerous times on 29 pages. Id.
In addition, the testimony taken during the two-day hearing on this case was overwhelmingly concerned with BISYS. Less than three pages of the hearing transcript, out of Ezekian's 65 pages of direct testimony, concern Asplundh. Transcript of June 2, 2003, at 9-76, specifically pages 71-73. A great deal of the testimony also concerned arguments that were wholly unsuccessful; namely, Ezekian's effort to add an implied covenant of good faith and fair dealing to his contract, and his argument that the contract was rendered a nullity by vagueness.
In Clarke v. Whitney, supra, the court reduced the plaintiff's fee award under the WPCL, and under the Pennsylvania Human Relations Act, by 25%, because of the Plaintiff's limited success, even after hours were deducted from the pre-lodestar calculation to account for work on unsuccessful claims. 3 F. Supp.2d at 637.
More strikingly, the court in Orson. Inc. v. Miramax Film Corp., 14 F. Supp.2d 721 (E.D. Pa. 1998), reduced a fee award under one provision of the Pennsylvania Feature Motion Picture Fair Business Practices Law by 75% percent where the Plaintiff's claims under the Sherman Act, common law, and two other provisions of the Feature Motion Picture Fair Business Practices Law were dismissed before trial. 14 F. Supp. at 723, 727. The court also based its finding of limited success on the fact that the jury awarded the plaintiff only $159,780, although Plaintiff's expert testified to damages of $1,020,000. Id. at 727.
This case is more like Orson than it is like Clarke, with only a small percentage of the money sought recovered, and fundamental arguments rejected by the court. Accordingly, I will reduce the lodestar figure by 60%, to $11,392. I will similarly reduce Ezekian's $973.43 claim for costs by 60% to $389.37, for a total award of $11,790.72.
Finally, despite Anacomp's argument, I will not reduce these figures further to account for any events related to the parties' efforts to settle this case. Anacomp made no offer of judgment under Fed.R.Civ.Pr. 68, as occurred in the cases relied upon by Anacomp, Marek v. Chesnv. 473 U.S. 1 (1985) and Strauss v. Springer. 817 F. Supp. 1237 (E.D. Pa. 1993).
An appropriate order follows:
ORDER
AND NOW, this 8th day of October, 2003, upon consideration of Plaintiff s Petition for Attorney's Fees and Costs, docketed in this case as Document No. 22 and Defendants' response thereto, it is hereby ORDERED that Plaintiff is awarded attorney's fees of $11,392 and costs of $389.87, for a total award of $11,790.72.