Scott v. Kelkris Associates, Inc., No. 2:2010cv01654 - Document 36 (E.D. Cal. 2012)
Court Description: ORDER granting 28 Motion for Attorney Fees signed by Judge William B. Shubb on 3/28/12; IT IS THEREFORE ORDERED that defendant's motion for attorney's fees be, and the same hereby is, GRANTED in the amount of $6,859.00. (Matson, R)
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Scott v. Kelkris Associates, Inc. Doc. 36 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 ----oo0oo---LOREN SCOTT, NO. CIV. 2:10-1654 WBS DAD 12 Plaintiff, 13 v. MEMORANDUM AND ORDER RE: MOTION FOR ATTORNEY’S FEES 14 15 KELKRIS ASSOCIATES, INC. dba CREDIT BUREAU ASSOCIATES, 16 Defendant. 17 / 18 ----oo0oo---19 Plaintiff Loren Scott brought this action against 20 defendant Kelkris Associates, Inc., dba Credit Bureau Associates 21 arising out of defendant’s allegedly improper service of 22 plaintiff in a debt collection action. Presently before the 23 court is defendant’s motion for attorney’s fees. 24 I. Factual and Procedural Background 25 Defendant was assigned a debt that plaintiff allegedly 26 owed to Travis Credit Union. After failing to collect the debt 27 from plaintiff voluntarily, defendant initiated a debt collection 28 1 Dockets.Justia.com 1 suit against plaintiff in the Superior Court of California for 2 Sacramento County on January 23, 2009. (Compl. ¶ 6, Ex. B.) 3 Through a licensed process server, defendant 4 unsuccessfully attempted to effectuate substitute service on the 5 plaintiff by leaving a copy of the summons and lawsuit with 6 plaintiff’s father at a house that defendant incorrectly believed 7 to be plaintiff’s residence and by mailing copies of the same to 8 the residence. 9 default judgment was entered against plaintiff in the debt 10 11 (Steinheimer Decl. ¶¶ 7-9 (Docket No. 28).) collection action. A (Compl. ¶ 8.) The first that plaintiff learned of the suit filed 12 against him was when he received a letter notifying him of an 13 Earning Withholding Order. 14 default judgment against him, plaintiff contested the default 15 judgment, which the Superior Court vacated “on the ground of 16 inadvertence and excusable neglect.” 17 (Docket No. 18).) 18 After learning of the lawsuit and the (Friedman Decl. Ex. A Plaintiff brought suit against defendant alleging 19 violations of §§ 1692b(1)-(2), 1692c(b), 1692d, 1692e, 1692e(10), 20 and 1692f of the federal Fair Debt Collection Practices Act 21 (“FDCPA”), 15 U.S.C. § 1692 et seq., and §§ 1788.12(b) and 22 1788.14(a) of the California Rosenthal Fair Debt Collection 23 Practices Act (“Rosenthal Act”), Cal. Civ. Code § 1788 et seq. 24 (Docket No. 1.) 25 Defendant then brought a special motion to strike 26 plaintiff’s state law claims under California’s anti-Strategic 27 Lawsuits Against Public Participation (“anti-SLAPP”) statute, 28 Cal. Civ. Proc. Code § 425.16. (Docket No. 8.) 2 The motion was 1 granted only as to plaintiff’s claim for invasion of privacy, 2 eliminating the possibility that plaintiff could recover punitive 3 damages. 4 court issued its order on defendant’s anti-SLAPP motion, 5 defendant’s counsel sent plaintiff’s counsel an email requesting 6 attorney’s fees, but did not file a motion. 7 Ex. A (Docket No. 29).) 8 request, contending that because the invasion of privacy claim 9 was not “the crux” of plaintiff’s lawsuit and plaintiff would not (Oct. 29, 2010, Order (Docket No. 13).) After the (Shaw Decl. ¶¶ 5-8, Plaintiff’s counsel objected to the 10 have ultimately sought to recover the punitive damages requested 11 in the complaint, defendant was not a “prevailing defendant” on 12 its anti-SLAPP motion. 13 (Id. ¶¶ 3-7, Ex. A.) During discovery, plaintiff served one set of what 14 defendant characterizes as “boilerplate discovery” and did not 15 take any depositions. 16 identified only one witness who supported his claims, his father 17 Lewis Scott. 18 that he be deposed, Lewis Scott suffered a stroke that rendered 19 him unable to attend the deposition. 20 (Docket No. 29); Scott Decl. ¶ 12.) 21 rescheduled after he had recovered, but he failed to appear at 22 the deposition. 23 Lewis Scott did not respond to calls from plaintiff or 24 plaintiff’s counsel when they attempted to find out why he had 25 not appeared at the deposition as he had indicated he would. 26 (Friedman Decl. ¶ 11; Scott Decl. ¶¶ 9-12.) 27 28 (Steinheimer Decl. ¶ 3.) (Id. ¶ 4.) Plaintiff Shortly before defendant had requested (Friedman Decl. ¶ 11 The deposition was (Friedman Decl. ¶ 11; Scott Decl. ¶¶ 9-12.) At the close of discovery, defendant moved for summary judgment on all of plaintiff’s remaining claims. 3 (Docket No. 1 17.) 2 filed by himself and his father, which were similar to 3 declarations filed in the state court debt collection action. 4 (Steinheimer Decl. ¶ 5.) 5 disputed material facts and that plaintiff had failed to produce 6 evidence sufficient to support his allegations that defendant had 7 violated the FDCPA and the Rosenthal Act. (Mar. 23, 2012, Am. 8 Order at 8-17 (Docket No. 32).) 9 defendant’s motion for summary judgment as to all remaining 10 The only evidence plaintiff produced were declarations The court found that there were no Accordingly, the court granted claims. 11 Defendant now moves for reasonable attorney’s fees in 12 the amount of $24,929.29 pursuant to 15 U.S.C. § 1692k(a)(3) and 13 California Civil Code section 1788.30(c), or for reasonable 14 attorney’s fees in the amount of $8,459.00 pursuant to California 15 Code of Civil Procedure section 425.16(c) as the prevailing 16 defendant on its special motion to strike. 17 II. 18 Discussion A. Attorney’s Fees Pursuant to the FDCPA and the Rosenthal 19 Act 20 Both the FDCPA and the Rosenthal Act contain fee- 21 shifting provisions. Under § 1692k(a)(3) of the FDCPA, “[o]n a 22 finding by the court that an action under this section was 23 brought in bad faith and for the purpose of harassment, the court 24 may award to the defendant attorney’s fees reasonable in relation 25 to the work expended and costs.” 26 recover under this statute, there must be “evidence that the 27 plaintiff knew that his claim was meritless and that plaintiff 28 pursued his claims with the purpose of harassing the defendant.” 4 15 U.S.C. § 1692k(a)(3). To 1 Gorman v. Wolpoff & Abramson, LLP, 435 F. Supp. 2d 1004, 1013 2 (N.D. Cal. 2006), 3 Cir. 2009). 4 considered bad faith, Guerrero v. RJM Acquisitions LLC, 499 F.3d 5 926, 940 (9th Cir. 2007), and to show bad faith, a defendant must 6 show more than mere frivilousness, Krapf v. Nationwide Credit 7 Inc., No. SACV 09-00711, 2010 WL 2025323, at *5 (C.D. Cal. May 8 21, 2010). 9 rev'd on other grounds, 584 F.3d 1147 (9th At a minimum, “minimally colorable” claims are not The Rosenthal Act, in turn, provides that “reasonable 10 attorney’s fees may be awarded to a prevailing creditor upon a 11 finding by the court that the debtor’s prosecution or defense of 12 the action was not in good faith.” 13 Both statutes, therefore, limit a defendant’s ability to recover 14 attorney’s fees to instances where the plaintiff has acted in bad 15 faith in bringing his or her action. 16 Civ. 2:05-01207, 2009 WL 394290, at *1 (E.D. Cal. Feb. 17, 2009). 17 Defendant argues that plaintiff’s bad faith in bringing Cal. Civ. Code § 1788.30(c). Roybal v. Trans Union, No. 18 this action is demonstrated by the fact that plaintiff’s claims 19 lacked merit and a factual or legal basis. 20 plaintiff produced only limited evidence in opposition to 21 defendant’s motion for summary judgment and that defendant was 22 successful in obtaining summary judgment on all of plaintiff’s 23 claims under the FDCPA and the Rosenthal Act. 24 the court ultimately determined that plaintiff had not 25 demonstrated a triable issue of material fact as to his FDCPA and 26 Rosenthal Act claims. 27 plaintiff’s claims as frivolous or barely colorable, there is no 28 proof that plaintiff knew his claim was meritless, Gorman, 435 F. It notes that It is true that While it might be fair to characterize 5 1 Supp. 2d at 1013, or other evidence to support a finding of bad 2 faith. 3 It cannot be the law that any time a plaintiff loses on 4 summary judgment, he has acted in bad faith. See id. at 1012-13 5 (granting defendant’s motion for summary judgment on FDCPA 6 claims, but declining to find bad faith); Walsh v. Frederick J. 7 Hanna & Assocs., No. Civ. 2:10-2720, 2011 WL 537854, at *1 (E.D. 8 Cal. Feb. 15, 2011) (finding no bad faith where plaintiff’s FDCPA 9 and Rosenthal Act claims were dismissed with prejudice). 10 Defendant has not made the extra showing of bad faith. 11 Accordingly, defendant is not entitled to attorney’s fees under 12 California Civil Code section 1788.30(c) or § 1692k(a)(3) of the 13 FDCPA. 14 B. Fees Pursuant to California Code of Civil Procedure 15 Section 425.16 16 Pursuant to California’s anti-SLAPP statute, “a 17 prevailing defendant on a special motion to strike shall be 18 entitled to recover his or her attorney’s fees and costs.” 19 Civ. Proc. Code § 425.16(c)(1). 20 award of fees and costs is mandatory under the statute, Ketchum 21 v. Moses, 24 Cal. 4th 1122, 1131 (2001), and applies to 22 successful anti-SLAPP motions brought in federal court, Verizon 23 Del., Inc. v. Covad Commc’ns Co., 377 F.3d 1081, 1091 (9th Cir. 24 2004). 25 include the “fees incurred in litigating the award of attorney 26 fees.” Cal. It is well-settled that such an An award of fees under subsection 425.16(c)(1) may also Ketchum, 24 Cal. 4th at 1141. 27 “The fee-shifting provision was apparently intended to 28 discourage [] strategic lawsuits against public participation by 6 1 imposing the litigation costs on the party seeking to ‘chill the 2 valid exercise of the constitutional rights of freedom of speech 3 and petition for the redress of grievances’ and encourage 4 ‘private representation in SLAPP cases.’” Id. at 1131 (quoting 5 Cal. Civ. Proc. Code § 425.16(a)); see also Northon v. Rule, 637 6 F.3d 937, 938 (9th Cir. 2011) (“The entitlement to fees and costs 7 enhances the anti-SLAPP law’s protection of the state’s 8 ‘important, substantive’ interests.”). 9 thus held that the anti-SLAPP statute reflects a “strong California courts have 10 preference for awarding attorney fees to successful defendants” 11 and the “term ‘prevailing party’ must be interpreted broadly to 12 favor an award of attorney fees to a partially successful 13 defendant.” 14 425-26 (1st Dist. 2009) (internal citations and quotation marks 15 omitted). 16 bringing an anti-SLAPP motion as to the claim for invasion of 17 privacy, defendant should not be considered a prevailing party. 18 Lin v. City of Pleasanton, 176 Cal. App. 4th 408, Plaintiff contends that despite defendant’s success in Under certain circumstances, a defendant may not be 19 considered a prevailing party even though the court granted its 20 anti-SLAPP motion because “the results of the motion were so 21 insignificant that the party did not achieve any practical 22 benefit from bringing the motion.” 23 Serv., Inc., 139 Cal. App. 4th 328, 340 (4th Dist. 2006). 24 crucial question is one of practicality; did anything of 25 substance (technical victories notwithstanding) change in the 26 posture of the case and the claims being lodged against the 27 defendant after it brought the special motion to strike than were 28 in existence beforehand.” Mann v. Quality Old Time “The Brown v. Elec. Arts, Inc., 722 F. 7 1 Supp. 2d 1148, 1155 (S.D. Cal. 2010). 2 In Moran v. Endres, 135 Cal. App. 4th 952 (2d Dist. 3 2006), the trial court denied fees under subsection 425.16(c) 4 when the defendant had moved to strike all eleven causes of 5 action in the complaint, but was successful only in striking a 6 purported cause of action for “conspiracy.” 7 appellate court upheld this decision on the grounds that such a 8 trivial victory on a cause of action that was not truly a cause 9 of action to begin with did not entitle the defendant to Id. at 954-56. The 10 attorney’s fees where the ruling “in every practical sense meant 11 nothing.” 12 Id. In contrast, in Mann, the court held that the 13 defendants were entitled to fees even though they had 14 successfully eliminated only a trade libel cause of action. 15 Mann, 139 Cal. App. 4th at 340. 16 were the prevailing party despite the partial success of their 17 motion, the court noted that the eliminated cause of action, 18 although similar to a remaining claim for defamation, was not 19 identical to that claim and that its elimination had the 20 “potential to narrow the litigation” and “reduc[e] recoverable 21 damages.” 22 In holding that the defendants Id. Here, it cannot be said that the court’s ruling on 23 defendant’s anti-SLAPP motion “in every practical sense meant 24 nothing.” 25 eliminating plaintiff’s invasion of privacy claim, and with it 26 the threat of punitive damages as that was the only claim in the 27 complaint on which punitive damages were available. 28 also narrowed the scope of discovery. To the contrary, the motion was successful in 8 The motion Plaintiff’s protestations 1 that the invasion of privacy claim was not central to his action 2 and that punitive damages would likely not have been available in 3 this case are of no moment. 4 plaintiff did not intend to seriously pursue, then it was 5 precisely the type of claim that the anti-SLAPP statute is 6 intended to protect against. 7 Accordingly, defendant is a prevailing party entitled to an award 8 of the attorney’s fees incurred in bringing the special motion to 9 strike. 10 If this claim was truly one that See Cal. Civ. Proc. Code § 425.16. III. Calculating the Award 11 “[T]he fee setting inquiry in California ordinarily 12 begins with the ‘lodestar,’ i.e., the number of hours reasonably 13 expended multiplied by the reasonable hourly rate.” 14 Drexler, 22 Cal. 4th 1084, 1095 (2000); see Ketchum, 24 Cal. 4th 15 at 1131 (indicating that the lodestar is used to calculate fees 16 under the anti-SLAPP statute). 17 that prevailing in the community for similar work.” 18 22 Cal. 4th at 1095 (citing Margolin v. Reg’l Planning Comm’n, 19 134 Cal. App. 3d 999, 1004 (2d Dist. 1982)). 20 then by adjusted upward or downward by the court based on 21 relevant factors. 22 Local Rule 293(c) provides the following list of non-exhaustive 23 factors that guide a court’s award of attorney’s fees: 24 (1) (2) 25 (3) 26 (4) 27 28 (5) PLCM Grp. v. “The reasonable hourly rate is PLCM Grp., The lodestar may Ketchum, 24 Cal. 4th at 1132. Specifically, the time and labor required of the attorney(s); the novelty and difficulty of the questions presented; the skill required to perform the legal service properly; the preclusion of other employment by the attorney(s) because of the acceptance of the action; the customary fee charged in matters of the type 9 1 involved; whether the fee contracted between the attorney and the client is fixed or contingent; any time limitations imposed by the client or the circumstances; the amount of money, or the value of the rights involved, and the results obtained; the experience, reputation, and ability of the attorney(s); the “undesirability” of the action; the nature and length of the professional relationship between the attorney and the client; awards in similar actions; and such other matters as the Court may deem appropriate under the circumstances. (6) 2 (7) 3 (8) 4 (9) 5 6 (10) (11) 7 (12) (13) 8 9 Local R. 293(c); see also Kerr v. Screen Extras Guild, Inc., 526 10 F.2d 67, 70 (9th Cir. 1975) (identifying the same factors as 11 relevant). 12 fee at the fair market value for the particular action.” 13 Ketchum, 24 Cal. 4th at 1132. 14 The purpose of adjusting the lodestar is to “fix a Defendants propose a lodestar figure of $8,459.00 for 15 work done on the anti-SLAPP motion. 16 hours expended by Andrew M. Steinheimer, a partner at Ellis Law 17 Group, LLP, and Brandon Reeves, an associate at Ellis Law Group, 18 LLP. 19 20 A. This figure accounts for Reasonable Hourly Rate The first step in calculating the lodestar is 21 determining the reasonable hourly rate, which is the rate 22 “prevailing in the community for similar work.” 23 Cal. 4th at 1095. 24 forum in which the district court sits.” 25 F.3d 496, 500 (9th Cir. 1997). PLCM Group, 22 “Generally, the relevant community is the Barjon v. Dalton, 132 26 Defendant requests rates of $200 per hour for Mr. 27 Steinheimer and $195 per hour for Mr. Reeves, which are the 28 hourly rates agreed upon by defendant and defendant’s counsel. 10 1 (Steinheimer Decl. ¶ 21.) The court finds that these rates are 2 reasonable, and if anything, below the prevailing rate in the 3 Eastern District of California for similar work. 4 Branco v. Credit Collection Servs., Inc., No. Civ. 2:10–01242, 5 2011 WL 6003877, at *4 (E.D. Cal. Dec. 1, 2011) ($275); Valero v. 6 Bryant, LaFayette & Assocs., LLC, No. Civ. 1:10–01174, 2011 WL 7 1438436, at *6 (E.D. Cal. Apr. 14, 2011) ($250); Hartung v. J.D. 8 Bryider, Inc., No. Civ. 1:08-00960, 2009 WL 1876690, at *12 (E.D. 9 Cal. June 26, 2009) ($250); Lowe v. Elite Recovery Solutions, No. See, e.g., 10 Civ. S-07-0627, 2008 WL 324777, at *5 (E.D. Cal. Feb. 5, 2008) 11 ($250). 12 B. 13 Accordingly, the court finds these rates reasonable. Reasonable Number of Hours Defendant has submitted itemized billing for work on 14 the anti-SLAPP motion that details the number of hours spent by 15 each attorney. 16 26.7 hours on the special motion to strike. 17 plaintiff objected generally to the number of hours spent on the 18 special motion to strike as unreasonable. 19 its briefing nor at oral arguments was plaintiff able to point to 20 any specific entry as unreasonably excessive or to submit any 21 relevant evidence in support of this contention, as he should 22 have been prepared to do in opposition to defendant’s motion.1 In total, defendant represents that counsel spent At oral arguments, However, neither in 23 24 25 26 27 28 1 In suggesting that the time spent by defendant’s attorneys in seeking summary judgment on plaintiff’s claim for invasion of privacy and request for punitive damages was excessive, plaintiff’s attorney indicates that he would have been willing to drop that claim and request had defendant’s attorney approached him before filing the anti-SLAPP motion. However, plaintiff included that claim and prayer for relief in his Complaint and opposed defendant’s anti-SLAPP motion. It was only after the court granted defendant’s anti-SLAPP motion that plaintiff’s attorney indicated he would have been willing to 11 1 See Premier Med. Mgmt. Sys., Inc. v. Cal. Ins. Guar. Ass’n, 163 2 Cal. App. 4th 550, 560-63, (2d Dist. 2008) (recognizing that, 3 “[s]ince appellants submitted no evidence that the hours claimed 4 by counsel were excessive, they appear to be asking that we 5 declare as a matter of law that the hours were unreasonable,” and 6 declining to do so); Maughan v. Google Tech., Inc., 143 Cal. App. 7 4th 1242, 1251 (2d Dist. 2008) (discussing declaration submitted 8 by plaintiff comparing hours requested by defendant’s counsel 9 with the significantly fewer hours spent by plaintiff’s counsel 10 in upholding trial court’s reduction of hours as excessive). In 11 light of the absence of specific objections by plaintiff and the 12 complexity of the issues and quality of the work involved in 13 defendant’s anti-SLAPP motion, the court finds that the less than 14 30 hours spent on the motion as a whole is reasonable. 15 Defendant also seeks compensation for eight hours spent 16 drafting the instant motion for attorney’s fees as “fees incurred 17 in litigating the award of attorney fees,” which are recoverable 18 under subsection 425.16(c)(1). 19 The records before the court, however, do not indicate what 20 portion of these hours was spent seeking fees related to the 21 anti-SLAPP motions and what portion was spent seeking fees under 22 the Rosenthal Act and the FDCPA. 23 is sought in addition to the 7.9 hours that defendant seeks to 24 recover for work done on an earlier motion for attorney’s fees 25 under subsection 425.16(c)(1) that was never filed, but was used 26 in preparing the instant motion. Ketchum, 24 Cal. 4th at 1141. Recovery on these eight hours (Steinheimer Decl. ¶ 17.) 27 28 eliminate the claim that had already been stricken by the court. 12 1 For two reasons, the court does not find it reasonable 2 to include the eight hours spent drafting the instant motion in 3 defendant’s tally. 4 those hours was actually spent on matters related to defendant’s 5 special motion to strike and it does not appear that the requests 6 for attorney’s fees under various statutes were so intertwined 7 that allocation would be impossible. 8 Rent-A-Car Co., 79 Cal. App. 4th 1127, 1133 (1st Dist. 2000) 9 (noting that a court is not required to allocate attorney’s fees First, the court cannot tell what portion of See Akins v. Enterprise 10 between successful and unsuccessful efforts for work on issues or 11 claims that are so intertwined that it is impossible to separate 12 them). 13 under the anti-SLAPP statute that were not incurred on matters 14 related to its special motion to dismiss. 15 Inc. v. Chronicle Publ’g Co., 39 Cal. App. 4th 1379, 1383 (1st 16 Dist. 1995). 17 It would be improper to allow defendant to recover fees Lafayette Morehouse, Second, it apparently took 7.9 hours for defendant’s 18 counsel to draft a motion for attorney’s fees related to its 19 anti-SLAPP motion. 20 the eight hours spent drafting the instant motion, which included 21 new requests under two different statutes and dealt with 22 additional facts, counsel would have had time to do much work 23 related to the anti-SLAPP recovery beyond simply attaching the 24 earlier drafted material. 25 while it is reasonable to include the 7.9 hours expended by 26 defendant on its special motion to strike as time spent to 27 recover fees, it would be unreasonable to also include the 28 additional eight hours. It does not seem reasonable, then, that in Accordingly, the court finds that 13 1 Accordingly, the court will award defendant the 2 following fees: 3 Motion Special motion to strike Hours Rate 15.2 $200 Reeves 4 Attorney Steinheimer Fee $3,040.00 11.5 $195 $2,242.50 Steinheimer 7.2 $200 $1,440.00 Reeves 0.7 $195 $136.50 5 6 Motion for attorney’s fees 7 8 TOTAL $6,859.00 9 10 IT IS THEREFORE ORDERED that defendant’s motion for 11 attorney’s fees be, and the same hereby is, GRANTED in the amount 12 of $6,859.00. 13 DATED: March 28, 2012 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 14
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