A2Z Dental, LLC v. Miri Trading, LLC

494 F.Supp.3d 30

A2Z DENTAL, LLC, Plaintiff,

v.MIRI TRADING, LLC d/b/a Polaroid Dental Imaging, Defendant.

CIVIL ACTION NO. 4:19-40068-TSH

United States District Court, D. Massachusetts.

Filed October 2, 2020

Robert S. White, James S. Duffy, BourgeoisWhite, LLP, Worcester, MA, for Plaintiff.

Richard B. Reiling, Boston, MA, for Defendant.

ORDER ON PLAINTIFF'S MOTION FOR ATTORNEYS’ FEES (Docket Nos. 52 and 54)

HILLMAN, D.J.,

A2Z Dental, LLC ("A2Z") filed the instant action against Miri Trading, LLC ("Miri") alleging breach of contract, breach of the implied covenant of good faith and fair dealing, intentional misrepresentation, negligent representation, mutual mistake/equitable reformation, unilateral mistake, and violations of M.G.L. c. 93A. § 11 (Docket No. 1). After Miri failed to file a timely answer to A2Z's complaint, the Court entered default judgement against Miri and denied Miri's subsequent request to set aside the default. (Docket Nos. 9, 10, 11).

The Judgment found that, among other offenses, Miri had violated 93A by failing to disclose during negotiations with A2Z that 19 of the 36 dental sensors it was selling would come with temporary software licenses (the rest were never delivered), rather than the permanent software licenses that Miri had provided with the first four sensors it sold to A2Z. (Docket No. 44, ¶¶ 63-67). I did not award damages under 93A or for negligent representation because A2Z had not provided any evidence of damages stemming from the temporary software licenses, such as the cost that A2Z paid to obtain permanent licenses or replace the sensors with temporary licenses.

(Docket No. 44, ¶ 68). Instead, I awarded A2Z $96,017 on its breach of contract and breach of the implied covenant of good faith and fair dealing claims. That amount included $55,675 that A2Z paid to Miri for undelivered sensors and the $40,342 difference in price A2Z paid to a third-party to replace the undelivered sensors. (Docket No. 44 at 12-13). I also awarded A2Z $3,708 for Miri's intentional evasion of service of process under Fed. R. Civ. P. 4(d). (Id. ).

Following the Court's Entry of Judgment, A2Z filed a Motion for Attorneys’ Fees under M.G.L. c. 91A §§ 2, 11 and Fed. R. Civ. P. 54(d). (Docket Nos. 44, 46). On July 22, 2020, I denied the Motion for Attorneys’ Fees without prejudice to renew upon a more detailed explanation and breakdown of the proposed costs and fees attributable to the successful portion of their 93A claim. (Docket No. 50).

My Order did not set a deadline for A2Z to renew its motion for attorneys’ fees, but on September 4, 2020, Miri asked the Court to deny the request for fees and close the case, which A2Z opposed. (Docket Nos. 53, 54). On September 8, 2020, A2Z filed this renewed Motion for Attorneys’ Fees. (Docket No. 55). A2Z seeks $24,039.00 in fees and $694.78 in costs for the law firm of BourgeoisWhite, LLP, as well as $5,574.38 in fees and costs for Attorney Stephen J. Chaplin.

Discussion

1. Miri's Motion to Deny Plaintiff's Request for Attorney Fees and Costs with Prejudice and Close Case.

Miri argues that Plaintiff's renewed Motion for Attorney's Fees must be denied as untimely. (Docket No. 52). My Order granting A2Z leave to renew their Motion did not contain a deadline and Miri has not stated how the six-week delay would prejudice it. (Docket No. 50). Therefore, Miri's Motion to Deny Plaintiff's Request for Attorney Fees and Costs is denied.

2. A2Z's Renewed Motion for Attorneys’ Fees and Costs.

Miri objects to A2Z's renewed motion on three grounds: (1) that A2Z cannot recover 93A attorney fees where 93A damages were not awarded; (2) that even if attorney fees were allowed by law, A2Z has not provided sufficiently detailed records of the legal work performed to recover its fees; and (3) that 28 U.S.C. § 1920 precludes A2Z's recovery of any costs beyond the complaint filing fee.

a. Availability of Attorneys’ Fees.

Miri correctly points out that the Court entered judgment for A2Z on the c. 93A § 11 claim but did not award damages because A2Z did not provide evidence to substantiate the extent of the injury caused by receiving the sensors with the temporary software licenses. (Docket No. 44 at 12-13).

Attorney fees are allowed for 93A § 11 claims even when the court does not award damages. To be sure, a § 11 plaintiff "cannot recover attorney's fees for merely identifying an unfair or deceptive act or practice." Jet Line Services, Inc. v. American Employers Insur. Co. , 404 Mass. 706, 718, 537 N.E.2d 107 (Mass. 1989). Nonetheless, a § 11 plaintiff who can show that an unfair or deceptive practice has had "some adverse effect" on them may recover attorneys’ fees, even if that adverse effect "is not quantifiable in dollars. " Id. (emphasis added).

Courts applying the Jet Line adverse effect test have construed "adverse effect" broadly. In NASCO, Inc. v. Public Storage, Inc. , the First Circuit held that a business which contracted to sell a warehouse, and which prevailed on its 93A claim against the buyer without proving damages, was entitled to attorneys’ fees. 127 F.3d 148, 149-50 (1st Cir. 1997). NASCO's purported adverse effect was that it had incurred legal fees for work performed in anticipation of the sale closing, and utility fees to reactivate the warehouse's electricity at the purchaser's request. Id. NASCO never paid the legal or electric bills, but the Court reasoned that the bills alone were sufficient adverse effects to justify attorney's fees because they "worsened NASCO's position and put it at risk of suit." Id. at 154. See also RFF Family Partnership, LP v. Link Development, LLC , 2015 WL 1472253 (Mar. 31, 2015 D. Mass.) (finding that nominal damages of $1 and adverse effects supported awarding attorneys’ fees to § 11 plaintiff); Shapiro v. Public Serv. Mut. Ins. Co. , 19 Mass.App.Ct. 648, 657-660, 477 N.E.2d 146 (Mass. App. Ct. 1985) (insured not entitled to damages on Consumer Protection Act claim was nonetheless entitled to attorney fees because he established that the insurer committed an unfair act) (discussed with approval in Jet Line , rejected on other grounds by Lumbermens Mut. Cas. Co. v. Belleville Industries, Inc. , 407 Mass. 675, 555 N.E.2d 568 (Mass. 1990) ). While Jet Line ’s reasoning has been called into question by Kiely v. Teradyne , which held that a finding of retaliation alone, without any form of relief or recovery, cannot support an award of attorneys’ fees in employment discrimination cases brought under G.L. c. 151B § 9, Jet Line remains good law for 93A § 11 claims. 85 Mass.App.Ct. 431, 447-49, 13 N.E.3d 615 (Mass. App. Ct. 2014).

The adverse effects that A2Z incurred as a result of Miri's unfair acts are more tangible and direct than what passed judicial muster in NASCO . Miri sold A2Z 4 dental sensors that were inoperable without permanent software licenses, which Miri included at no additional charge. (Docket No. 44, ¶¶ 7, 14). Satisfied with the initial 4 sensors, Miri contracted to sell A2Z 36 additional sensors. (¶ 9). Unlike the first 4 sensors, the next 19 sensors Miri delivered came with temporary software licenses. (¶ 16). As a result, they ceased operating after 30 days, resulting in a total loss of A2Z's $68,075 investment. (¶ 19). Such an adverse effect supports an award of attorneys’ fees under Jet Line .

b. Amount of Attorneys’ Fees.

A2Z is entitled to the reasonable costs and attorneys’ fees it incurred in connection with its action. Mass. G.L. c. 93A § 11. The fee amount falls within the Court's discretion, and ultimately focuses on the objective worth of counsel's services. Berman v. Linnane , 434 Mass. 301, 302-03, 748 N.E.2d 466 (Mass. 2001). To determine what is reasonable, the court "should consider the nature of the case and the issues presented, the time and labor required, the amount of damages involved, the result obtained, the experience, reputation, and ability of the attorney, the usual price charged for similar services by other attorneys in the same area, and the amount of awards in similar cases." Linthicum v. Archambault , 379 Mass. 381, 388-89, 398 N.E.2d 482 (1979). The prevailing party must "submit sufficient documentation to enable the judge to evaluate the hours spent on particular aspects of the case or the precise nature of the work." Twin Fires v. Morgan Stanley Dean Witter , 445 Mass. 411, 428, 837 N.E.2d 1121 (2005).

93A fee awards should be limited to the fees incurred in connection with the plaintiff's 93A claims, unless the plaintiff's other claims are "largely predicated on identical facts, and thus the legal effort to establish the two classes of claims was virtually the same." Twin Fires at 1138. A2Z's 93A claims, its common-law contract and misrepresentation claims, and its equitable claims are all based on the negotiation and execution of a single agreement between Miri and A2Z for the purchase of 36 dental sensors, so strict apportionment of the expenses is not required. Nonetheless, the Court must deduct the approximate amount of fees for "items wholly unrelated" to proving the 93A claims. Incase, Inc. v. Timex Corp. , 421 F.Supp. 2d 226, 244 (D. Mass. 2006). Keeping the Linthicum factors in mind, the Court begins its analysis.

This was a straightforward case which did not present any new or complex questions of law and should not have taken substantial time or labor to litigate. Motions practice was limited, especially considering that Miri's failure to file responsive pleadings resulted in a default judgment against it. In addition to drafting the 93A demand letter and Complaint, A2Z's attorneys sought a default judgment, responded to Miri's motions to set aside the Court's default and motion to dismiss for lack of jurisdiction, submitted proposed findings of fact for the Court's judgment, and prepared for and participated in a damages hearing on May 1, 2020. (Docket No. 19). They successfully established Miri's liability for breach of contract, breach of the covenant of good faith and...