Opinion
NOT FOR PUBLICATION
ORDER ON MOTION OF SHULMAN HODGES & BASTIAN, LLP FOR AWARD OF FEES AND COSTS
PETER W. BOWIE, Chief Judge United States Bankruptcy Court
This matter came on regularly for hearing on the motion for order allowing and authorizing fees and expenses of Shulman Hodges & Bastian LLP (SHE) and the objection of the Official Committee of Unsecured Creditors of SAIF, Inc., (OCC) to that motion.
The Court has subject matter jurisdiction over the proceeding pursuant to 28 U.S.C. § 1334 and General Order No. 312-D of the United States District Court for the Southern District of California. This is a core proceeding under 28 U.S.C. § 157(b)(2)(A) & (B).
In the motion SHB seeks confirmation and final approval of two prior awards made in the Secured Assets Trust (SAT) - one on April 17, 2008 in the amount of $72,065.82 and one on April 21, 2008 in the amount of $32,640.48. SHB also seeks final approval of the award made in this case on December 2, 2008, in the amount of $66,196.45. Finally, SHB seeks an award of fees and expenses for the period October 1, 2008 to February 2, 2009 (Final Period) in the amounts of $16,800.50 and $997.41. In its reply, however, SHB withdrew its request for final approval of the prior awards, arguing that they have already been approved under § 503(b), as opposed to § 330, and are thus not subject to final approval. Rather, suggests SHB, the sole focus of the motion before the Court is the fees and expenses for the Final period.
As a preliminary matter, the Court agrees with SHB that under the facts of this case the prior awards need not be finally approved as would be the case of fees awarded under § 330. The Global Settlement Stipulation, with which all the parties are familiar, provides:
6. The Parties further stipulate that all of the attorneys' fees and costs incurred by the Stipulating Noteholders in the SAT and SAIF cases through the firm of Shulman Hodges & Bastian LLP ("SHB"), all of the fees and costs incurred by the Chapter 11 Trustee for SAT while the SAT case was pending, and all of the professional fees and costs incurred by the Chapter 11 Trustee for SAT during his time as Chapter 11 Trustee for SAT, specifically the fees and costs incurred by SHB, who also served previously as counsel to the Chapter 11 Trustee for SAT's accountants, shall be allowed as administrative claims in the SAIF case pursuant to Bankruptcy Code Section 5 03(b), subject only to court approval for reasonableness of such fees and expenses.
Thus, though at least one of the prior awards was made under § 330 in the SAT case, all of the prior awards were allowed in this case as claims under § 503(b). The Court has already held that the Stipulation provides for recovery of fees and costs by SHB subject only to reasonableness. See Fee Order entered December 3, 2008. Other than the fees and costs sought for the Final Period, the awards have already been found to be reasonable.
The April 17, 2008 award was made in the SAT case under § 330, which is limited to "reasonable compensation." Similarly, the awards made in the SAT case on April 21, 2 008 and the one made in this case on December 3, 2008 were both made under § 503(b)(4) which requires a determination of "reasonable compensation."
Thus, the Court finds that the only fees and costs put at issue by the motion, as modified in the reply consistent with the Global Settlement Stipulation, are those incurred during the Final Period.
In their opposition, the OCC makes the general argument that SHE'S services throughout this case were not reasonable because they disrupted the SAIF case and caused both sides to run up legal tabs. However, the only reasonableness challenge the OCC makes as to the fees and costs incurred in the Final Period is to the fees incurred in objecting to the fee applications of the other professionals. The Court has largely ruled against SHB on those objections by separate memorandum. However, the Court does not find the objections unreasonable. Substantial fees have been incurred by all of the professionals involved in this case at the cost of all of their clients. They may have been avoidable. However, the Court does not find that they were incurred unreasonably. The professionals disagree about the approaches taken by one another, but they were all looking out for their own clients and the Court does not find that any of the services rendered were patently unreasonable.
For the foregoing reasons, as well as those previously set out on the record, final attorneys fees and costs for SHB are allowed as follows:
Attorneys fees:
$16,800.50
Costs:
$ 997.41.
IT IS SO ORDERED.