Tru Mobility, Inc. v. Briggs Auto. Grp.

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TRU MOBILITY, INC., Plaintiff, v. BRIGGS AUTO GROUP, INC., Defendant.

No. 5:21-CV-04071-JAR-TJJ

United States District Court, D. Kansas

August 2, 2023

MEMORANDUM AND ORDER

JULIE A. ROBINSON, UNITED STATES DISTRICT JUDGE

This matter is before the Court on Defendant Briggs Auto Group Inc.'s Motion for Attorneys Fees (Doc. 84). The motion is fully briefed, and the Court is prepared to rule. For the reasons explained below, the Court grants Defendant's motion and awards it $137,401.52.

I. Background

In 2017, Defendant executed three contracts with Plaintiff for various telecommunication products and services.^[1] Each of these three contracts incorporated by reference an Addendum to Contracts^[2] as well as a separate Standard Terms and Conditions document.^[3] All of these contracts are governed by Florida law. In 2021, Plaintiff brought this diversity action against Defendant for breach of the three contracts, alleging that Defendant failed to pay the early termination fees that it owed Plaintiff for terminating the contracts prior to the end of the agreed-upon term. Each of the three contracts at issue here were governed by a separate Standard Terms and Conditions document, which provides in relevant part:

Attorneys' Fees and Costs. The prevailing party in any litigation and/or arbitration arising from or related to this Agreement shall be entitled to recover from the non-prevailing party all reasonable attorneys' fees and costs incurred in the litigation and/or arbitration.^[4]

On April 17, 2023, the Court granted summary judgment in favor of Defendant.^[5]Defendant filed the present motion on May 1, 2023, seeking to recover $137,964.02 in contractual attorney fees, costs, and expenses.^[6] On June 8, 2023, the Court issued an Order directing the parties to meet and confer on Defendant's motion and either file an appropriate stipulation indicating that they have reached an agreement, or file a statement of consultation in accordance with D. Kan. Rule 54.2(d) and fully brief the motion.^[7]

In accordance with the Court's Order, Defendant filed a Statement regarding the Order on Motion for Attorney Fees, explaining that the parties had met and conferred in good faith but had failed to reach an agreement on Defendant's motion.^[8] Plaintiff confirmed in its Response that the consultation had taken place in good faith and that no agreement had been reached.^[9] Plaintiff also explained that it “disputes” Defendant's motion “for the reasons that the time and costs in the request are improperly documented,” and because “much of the time and effort expended by the defendant was for the prosecution of its counterclaim which ultimately was dismissed.”^[10]Defendant thereafter filed a Reply in Support of its Motion for Attorney Fees and Costs, reiterating its requests, and addressing the response.^[11]

II. Discussion

A. Entitlement

The general rule in American litigation is that each party in a lawsuit will bear its own attorneys' fees.^[12] However, there is a contractual exception to this rule. Under Florida law, which governs this dispute,^[13] “attorneys' fees may be awarded to the prevailing party pursuant to a contractual agreement authorizing their recovery.”^[14] The burden is on the party seeking attorneys' fees to establish entitlement to them.^[15] “The Court does not have discretion to decline to enforce a contractual provision awarding attorneys' fees.”^[16] Thus, a “contractual attorney's fee provision must be strictly construed.”^[17] “Florida courts have explained that ‘if an agreement for one party to pay another party's attorney's fees is to be enforced it must unambiguously state that intention and clearly identify the matter in which the attorney's fees are recoverable.'”^[18]

Defendant argues that it is entitled to attorney's fees, paralegal fees, costs, and expenses pursuant to the Attorneys' Fees and Costs provision in the Standard Terms and Conditions.

Plaintiff makes no objection to Defendant's entitlement arguments. Strictly construing the attorney fees provision, the Court finds that it applies to the matter at hand. Indeed, “Florida law explicitly provides that ‘claims arise out of a contract if they are inextricably intertwined with the contract.'”^[19] Clearly, Plaintiff's breach of contract claim is inextricably intertwined with the Standard Terms and Conditions contract which was incorporated by reference into each of the three contracts that Plaintiff claimed Defendant breached. Therefore, the Court finds that Defendant is entitled to all reasonable attorney fees incurred in this litigation.

The Court also notes that, while not explicitly included in the contract, Florida law dictates that “awards of attorneys' fees should include the time and labor of legal assistants who contributed nonclerical, meaningful legal support.”^[20] Thus, the Court is satisfied that Defendant is also entitled to recover its paralegal fees.

Finally, the Court turns to Defendant's request for costs and expenses. Defendant states that it seeks to recover costs and expenses pursuant to both the contract language as well as Fed.R.Civ.P. 54. However, the Court construes Defendant's request as one for recovery of nontaxable expenses, as opposed to taxable costs governed by Rule 54,^[21] as the expenses it seeks to recover-for depositions, mediation, and postage-are not found on the list of taxable costs under 28 U.S.C. § 1920.^[22] Given the contractual language here, the Court finds that Defendant is entitled to recovery of such nontaxable expenses.^[23]

B. Amount

To determine the proper amount of attorney's fees to be awarded under Florida law, the Court must calculate the lodestar. The lodestar method “requires the court to determine the number of hours reasonably expended on the litigation,” and “a reasonable hourly rate for the services of the prevailing party's attorney.”^[24] In Rowe, the Florida Supreme Court outlined the factors to be considered in determining what hours and what rates are reasonable for a particular case:

(1) The time and labor required, the novelty and difficulty of the question involved, and the skill requisite to perform the legal service properly. (2) The likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer. (3) The fee customarily charged in the locality for similar legal services. (4) The amount involved and the results obtained. (5) The time limitations imposed by the client or by the circumstances. (6) The nature and length of the professional relationship with the client. (7) The experience, reputation, and ability of the lawyer or lawyers performing the services. (8) Whether the fee is fixed or contingent.^[25]

“The number of hours reasonably expended, determined in the first step, multiplied by a reasonable hourly rate, determined in the second step, produces the lodestar.”^[26] The determination of fee awards falls “within the sound discretion of the trial court.”^[27]

Defendant seeks $137,964.02 in attorney's fees, paralegal fees, costs, and expenses incurred in defending against Plaintiff's lawsuit. Specifically, Defendant seeks $111,587.50 in attorney's fees for 320.6 hours spent; $23,225.00 in paralegal fees for 129.50 hours spent; and $3,151.52 in costs and expenses. At the beginning of the representation, Defendant's counsel charged an hourly rate of $350 for his time and $175 for his paralegal's time. He then increased his attorney's fees to $375 for a time but towards the end of the representation, he charged an hourly rate of $425 for his time and $200 for his paralegal's time. Finally, Defendant seeks to recover $3,151.52 in nontaxable expenses incurred for depositions, mediation, and postage.

1. Attorney and Paralegal Fees

As set forth above, to determine the reasonableness of the requested fees under Florida law, the Court must first determine a reasonable number of hours expended on the litigation, and then must determine a reasonable hourly rate for the services of the prevailing party's attorney.

a. Reasonable Number of Hours

Defendant seeks compensation for 320.60 hours of attorney's fees for his work on this matter, and 129.50 hours of paralegal's fees for his paralegal's work on this matter. In support of the reasonableness of the hours requested, Defendant's counsel submitted affidavits and detailed time records for both himself and his paralegal.^[28] Plaintiff does not make any specific objection to the amount of hours Defendant seeks compensation for; rather, Plaintiff argues that “the time and costs in the request are improperly documented” and that Defendant should not be compensated for time spent on the “prosecution of its counterclaim which was ultimately dismissed.”^[29] The Court addresses each objection in turn, and then turns to the Rowe factors.

First, Plaintiff asserts a vague objection that Defendant's time and costs are improperly documented. In response, Defendant argues that the provided time records are sufficiently detailed as they included the date, the task itself, the time spent on the task, the hourly rate applied on the date of the task, and the total charge of the task. Defendant also points to the fact that his client has already paid these fees and expenses in full without any objection to the documentation for them.

The Court is satisfied that the time and charges in Defendant's request is properly documented. Defendant provided detailed time records for his work and his paralegal's work which the Court finds provide sufficient detail. While nearly all of Defendant's counsel's time records include the rather vague phrase “preparation of matters with case,” nearly all of them also state with specificity the exact issue he was working on,...