Lopez et al v. OneWest Bank, FSB et al, No. 5:2015cv00759 - Document 98 (N.D. Cal. 2016)

Court Description: ORDER GRANTING IN PART AS MODIFIED AND DENYING IN PART 71 PLAINTIFFS' MOTION FOR FEES AND COSTS. Signed by Judge Beth Labson Freeman on 6/7/2016. (blflc1S, COURT STAFF) (Filed on 6/7/2016)
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1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 NORTHERN DISTRICT OF CALIFORNIA 9 SAN JOSE DIVISION 10 11 ALEX LOPEZ, et al., Case No. 15-cv-00759-BLF United States District Court Northern District of California Plaintiffs, 12 v. 13 14 CIT BANK, N.A., et al., Defendants. ORDER GRANTING IN PART AS MODIFIED AND DENYING IN PART PLAINTIFFS’ MOTION FOR FEES AND COSTS [Re: ECF No. 71] 15 16 17 This matter arises from a years-long credit reporting dispute between Plaintiffs, Alex and 18 Maria Lopez, and Defendants credit lender OneWest Bank, N.A. (“OneWest,” now known as CIT 19 Bank, N.A.), loan servicer Ocwen Loan Servicing LLC (“Ocwen”), and credit reporting agency 20 Equifax Information Systems LLC (“Equifax”). At the heart of the dispute is Plaintiffs’ allegation 21 that Defendants furnished and reported false credit information about Plaintiffs’ credit accounts in 22 violation of the Fair Credit Report Act (“FCRA”), 15 U.S.C. § 1681, et seq., and California’s 23 Consumer Credit Reporting Agencies Act (“CCRAA”), Cal. Civ. Code § 1785.1, et seq. Equifax 24 settled with Plaintiffs in January 2016. Thereafter, the remaining two Defendants, OneWest and 25 Ocwen presented a settlement offer pursuant to Federal Rule of Civil Procedure 68, which 26 Plaintiffs accepted. The only matter left unresolved is the issue of attorney’s fees and costs for 27 Plaintiffs’ counsel, Mr. Balam O. Letona. 28 Plaintiffs request an Order from this Court awarding reasonable fees and costs. For the 1 following reasons, the Court GRANTS AS MODIFIED Plaintiffs’ request for reasonable 2 attorney’s fees, and DENIES Plaintiffs’ request for costs.1 3 I. BACKGROUND 4 In May 2004, Plaintiffs took out a $100,000 mortgage loan from OneWest on their 5 property. Declaration of Alex Lopez in Support of Motion for Attorney Fees and Costs (“Lopez 6 Decl.,” ECF No. 77), Exh. 1. They experienced financial difficulties and eventually defaulted on 7 that loan in 2008. Id. ¶ 3. In March 2009, Plaintiffs filed a petition for Chapter 13 bankruptcy in 8 the Bankruptcy Court for the Northern District of California. Id. In accordance with the court- 9 ordered bankruptcy plan, Plaintiffs made periodic payments to a specified trustee until they fulfilled their total obligation. Id. Upon completion of their plan payments, the bankruptcy court 11 United States District Court Northern District of California 10 granted a Chapter 13 discharge on June 13, 2012. Declaration of Michael K. Mehr in Support of 12 Motion for Attorney Fees and Costs (“Mehr Decl.,” ECF No. 78), Exhs. 2, 6. The same day, the 13 bankruptcy court also entered an order discharging a junior mortgage debt and a junior mortgage 14 lien owned and serviced by OneWest. Id. The bankruptcy court entered judgment voiding the 15 OneWest lien, and on August 1, 2012, recorded the judgment with the Santa Cruz County 16 Recorder’s Office. Id. ¶ 3. 17 Plaintiffs thereafter learned that in spite of the discharge, OneWest continued to report to 18 credit reporting agencies, including Equifax, that Plaintiffs held an outstanding mortgage balance 19 of over $96,000 and were delinquent more than 180 days in the months post-discharge. Lopez 20 Decl. ¶¶ 4, 14, 16; Mehr Decl. ¶¶ 4, 5. When the debt was later transferred to Ocwen, Ocwen 21 similarly reported the amounts outstanding. Lopez Decl. ¶¶ 28, 29; Mehr Decl. ¶¶ 10–13. 22 Plaintiffs attempted to resolve the matter informally with Defendants, but were unable to do so. 23 Mehr Decl. ¶ 13. In February 2015, Plaintiffs filed an initial Complaint in the Northern District of 24 25 California, alleging that the manner in which OneWest, Ocwen, and Equifax reported the amount 26 1 27 28 Because Equifax had already settled with Plaintiffs, this Motion for Fees and Costs involves a dispute only as to Plaintiffs and the two remaining Defendants, OneWest and Ocwen. Therefore, as used in the balance of this Order, “Defendants” will refer to OneWest and Ocwen, and not Equifax, unless otherwise specified. 2 1 allegedly outstanding violated both the FCRA and the CCRAA. (ECF No. 1). Equifax filed an 2 answer, (ECF No. 20), while OneWest and Ocwen jointly filed a Rule 12(b)(6) motion to dismiss 3 the Complaint, (ECF No. 22). Plaintiffs later filed a First Amended Complaint (“FAC”), (ECF 4 No. 24), and the Court entered an order denying the dismissal motion as moot, (ECF No. 29). 5 Upon stipulation of the parties, on November 11, 2013, Plaintiffs filed a Second Amended 6 Complaint (“SAC”) against OneWest, Ocwen, and Equifax. (ECF No. 52); see also Order 7 Granting Stipulation to File a Second Amended Complaint (ECF No. 51). In her declaration, counsel for Ocwen and OneWest, Ms. Elena Kouvabina, attested that 8 9 her clients favored an early resolution to the case. Declaration of Elena Kouvabina in Support of Response to Plaintiffs’ Motion for Attorney Fees (“Kouvabina Decl.,” ECF No. 89) ¶ 3. 11 United States District Court Northern District of California 10 Defendants requested Plaintiffs to offer a settlement demand, but Plaintiffs declined to submit one 12 at the time. Id. The parties instead agreed to mediate the dispute. Id. They attended a July 20, 13 2015, court-sponsored mediation, but were unable to resolve the matter. Id. ¶ 4; Declaration of 14 Balam O. Letona in Support of Motion for Attorney Fees and Costs (“Letona Decl.,” ECF No. 73) 15 ¶ 19. 16 The case then proceeded through discovery. See (ECF No. 39). On July 31, 2015, Ocwen 17 and OneWest served written discovery requests on Plaintiffs to determine the evidentiary basis for 18 the damages Plaintiffs claimed. Kouvabina Decl. ¶ 5. However, as Ms. Kouvabina attested in her 19 declaration, Plaintiffs’ responses “were evasive and boilerplate.” Id. ¶ 7. Moreover, Ms. 20 Kouvabina explained that while Plaintiffs agreed to provide supplemental responses to 21 Defendants’ discovery requests, those responses were never produced. Id. 22 Similarly, Mr. Letona attested in his declaration that Defendants’ Rule 26 initial 23 disclosures were deficient, as they failed to identify witnesses or even the proper designee for 24 depositions. Supplemental Declaration of Balam O. Letona in Support of Reply to Opposition to 25 Motion for Attorney Fees and Costs (“Supplemental Letona Decl.,” ECF No. 93) ¶¶ 4, 5. Over the 26 course of a protracted meet and confer process, Plaintiffs tried unsuccessfully over six times to 27 meet in person with Ms. Kouvabina to coordinate the deposition of a former OneWest employee, 28 located in Michigan. Id. ¶ 6. The inability to meet and confer, as required by Magistrate Judge 3 1 Lloyd’s standing orders, was apparently so intractable that Plaintiffs eventually filed an ex parte 2 application for permission to conduct the deposition by remote means. See Order Granting 3 Motion to Permit Depositions by Remote Means (“Deposition Order,” ECF No. 55). Judge Lloyd 4 granted the application in an order dated December 18, 2015, in part because of Ms. Kouvabina’s 5 refusal to meet and confer in person. Id. at 2–3. The deposition occurred on January 20, 2016. 6 Supplemental Letona Decl. Exh. 2. 7 Toward the end of December 2015, the parties attempted to schedule a second mediation 8 session to resolve the dispute. Id. ¶ 12; Kouvabina Decl. ¶ 12. However, they were unable to 9 agree on terms and conditions for the proposed mediation, and the second session never occurred. 10 United States District Court Northern District of California 11 12 13 Supplemental Letona Decl. ¶ 12. On January 8, 2016, Plaintiffs and Equifax settled the case, and filed a joint stipulation to dismiss Equifax from the matter. See Order Granting Stipulation of Dismissal (ECF No. 66). On February 8, 2016, Plaintiffs accepted a Rule 68 offer of judgment from Defendants 14 OneWest and Ocwen that provided $50,000 in damages and injunctive relief. Notice of 15 Acceptance of Offer of Judgment (ECF No. 68). The Court entered judgment the same day. (ECF 16 No. 70). 17 Thereafter, on February 22, 2015, Plaintiffs filed the present Motion for Fees and Costs. 18 Motion for Attorney Fees (“Mot.,” ECF No. 71). In support of the Motion, Plaintiffs offered nine 19 declarations from six individuals, and numerous exhibits that included detailed billing records of 20 Mr. Letona’s work in the course of prosecuting this case. See (ECF Nos. 73–78, 84, 93, 94). In 21 their Opposition, Defendants Ocwen and OneWest provided a declaration from Ms. Kouvabina, 22 with attached exhibits. Response re: Motion for Attorney Fees (“Opp.,” ECF No. 89). Plaintiffs 23 filed a Reply on April 4, 2016. Reply re: Motion for Attorney Fees (“Reply,” ECF No. 92). On 24 April 18, 2016, the Court ordered counsel for Plaintiffs to submit a summary of hours to help 25 clarify the time requested in Plaintiffs’ Motion. (ECF No. 95). Mr. Letona submitted a response 26 to the Order on April 19, 2016. (ECF No. 96). The Court heard arguments on the Motion on 27 April 21, 2016, and took the matter under submission. (ECF No. 97). 28 4 1 II. LEGAL STANDARD Under the FCRA, a successful party in an action to enforce liability under the statute may 2 recover costs and reasonable attorney’s fees. See 15 U.S.C. § 1681n(a)(3) (“In the case of any 3 successful action to enforce any liability under this section, [the court may award] the costs of the 4 5 6 action together with reasonable attorney’s fees as determined by the court,” against “[a]ny person who willfully fails to comply” with the FCRA); 15 U.S.C. § 1681o(a)(2) (same for negligent violations of the FCRA). The CCRAA similarly provides that “the prevailing plaintiffs in any 7 action commenced under this section shall be entitled to recover court costs and reasonable 8 9 attorney’s fees.” See Cal. Civ. Code § 1785.31(d). When evaluating a motion for reasonable attorneys’ fees under the FCRA and CCRAA, 10 the Court undertakes a two-step process. Fischer v. SJB–P.D. Inc., 214 F.3d 1115, 1119 (9th Cir. United States District Court Northern District of California 11 2000). First, the Court calculates the presumptive fee award, also known as the “lodestar figure,” 12 by taking the number of hours reasonably expended on the litigation and multiplying it by a 13 reasonable hourly rate. Id. (citing Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)). The Court 14 15 16 17 18 “must carefully review attorney documentation of hours expended; ‘padding’ in the form of inefficient or duplicative efforts is not subject to compensation.” Ketchum v. Moses, 24 Cal. 4th 1122, 1132 (2001) (citation omitted). “The reasonable hourly rate is that prevailing in the community for similar work.” PLCM Grp. v. Drexler, 22 Cal. 4th 1084, 1095 (2000). Second, in “appropriate cases” the court may enhance or reduce the lodestar figure based 19 on an evaluation of the factors set forth in Kerr v. Screen Extras Guild, Inc., 526 F.2d 67, 69–70 20 (9th Cir. 1975), that were not taken into account in the initial lodestar calculation. Intel Corp. v. 21 Terabyte Intern., Inc., 6 F.3d 614, 622 (9th Cir. 1993) (citation omitted). The Kerr factors 22 include, but are not limited to, the time and labor required, the novelty and difficulty of the 23 questions involved, the skill required to perform the legal services properly, the preclusion of 24 other employment by the attorney due to acceptance of the case, whether the fee is fixed or 25 contingent, and the experience, reputation, and ability of the attorneys. Kerr, 526 F.2d at 70. The 26 27 Ninth Circuit has cautioned that there is a “strong presumption” that the lodestar figure represents a reasonable fee and that adjustment upward or downward is “the exception rather than the rule.” 28 5 1 D’Emanuele v. Montgomery Ward & Co., Inc., 904 F.2d 1379, 1384 (9th Cir. 1990). 2 III. DISCUSSION The Court normally begins by considering whether or not an award of attorneys’ fees is 3 4 proper. However here, there is no dispute that Defendants’ Rule 68 offer of judgment stipulated to 5 an award reasonable attorney’s fees, and in any case, the FCRA and CCRAA permit Plaintiffs in 6 this case to collect fees upon a successful action to enforce liability under those statutes. Instead, 7 the dispute centers around whether the amount of fees requested in this case is reasonable. 8 9 10 A. Amount of Fees i. Reasonableness of Rates In determining whether the amount of fees requested in this case is reasonable, the Court United States District Court Northern District of California 11 must first determine whether Plaintiffs’ attorney’s rates are reasonable. To do so, the Court must 12 weigh the “experience, skill, and reputation of the attorney requesting fees,” and compare the 13 requested rates to prevailing market rates. Chalmers v. City of Los Angeles, 796 F.2d 1205, 1210 14 (9th Cir. 1986), opinion amended on denial of reh’g, 808 F.2d 1373 (9th Cir. 1987); see also Blum 15 v. Stenson, 465 U.S. 886, 886 (1984). The relevant community for analyzing reasonable hourly 16 rates “is the forum in which the district court sits,” here the Northern District of California. 17 Camacho v. Bridgeport Fin., Inc., 523 F.3d 973, 979 (9th Cir. 2008). 18 Plaintiffs’ attorney, Mr. Balam O. Letona, seeks fees at the hourly rate of $450. Mot. at 6– 19 7. In support of his request, Plaintiffs, who bear the burden of establishing that the rates are 20 reasonable, see Gates v. Deukmejian, 987 F.2d 1392, 1397 (9th Cir. 1992), offer Mr. Letona’s 21 self-attested declaration, as well as the declarations of three of Mr. Letona’s colleagues 22 knowledgeable about his credentials and the prevailing hourly rates in Northern California for 23 attorneys who specialize in consumer protection litigation. Defendants do not object to the 24 declarations, nor for that matter to Mr. Letona’s $450 hourly rate. 25 The Court finds persuasive the papers submitted in support of Mr. Letona’s hourly fee of 26 $450. Mr. Letona’s declaration explains in detail his role and work in prosecuting this matter. 27 Letona Decl. ¶¶15–33. Mr. Letona has over thirteen years of experience litigating consumer 28 credit disputes, including those arising under the FCRA. Id. ¶¶ 2–4. His experience includes 6 1 work in about half a dozen class action suits on behalf of classes of consumers. Id. ¶ 3. Most 2 recently, Mr. Letona requested fees for his role in a class action lawsuit alleging violations of the 3 FCRA. See Holman v. Experian Info. Sols., Inc., No. 11-CV-0180 CW (DMR), 2014 WL 4 7186207, at *1 (N.D. Cal. Dec. 12, 2014). There, Judge Wilken found his hourly rate of $450 to 5 be reasonable given his education and legal experience. Id. at *4–5. 6 The declarations from Mr. Letona’s colleagues support this hourly rate. Mr. Andrew J. Ogilvie, a lawyer in San Francisco whose practice focuses on FCRA litigation, has worked with 8 Mr. Letona on a number of cases, including three class action suits. Declaration of Andrew J. 9 Ogilvie in Support of Motion for Attorney Fees and Costs (ECF No. 74). Mr. Scott Maurer, 10 Associate Clinical Professor of Law at Santa Clara Law School, stated that he believed Mr. 11 United States District Court Northern District of California 7 Letona’s requested fee to be reasonable based on market rates in this geographical area, and his 12 knowledge of Mr. Letona’s level of skill and experience. Declaration of Scott Maurer in Support 13 of Motion for Attorney Fees and Costs (ECF No. 75). Similarly, Mr. Ronald Wilcox, an attorney 14 with extensive experience as a consumer law attorney, explained that Mr. Letona’s hourly rate is 15 reasonable “given his experience, qualifications and expertise in the representation of consumers 16 in debtor-creditor litigation.” Declaration of Ronald Wilcox in Support of Motion for Attorney 17 Fees and Costs (ECF No. 76). The Court finds these papers in support of Mr. Letona’s hourly rate 18 persuasive, and agrees that his fee of $450 per hour is reasonable. 19 ii. Reasonableness of Hours 20 Next, the Court considers the reasonableness of the hours expended. To determine 21 whether the hours requested are reasonable, the Court may not “uncritically” accept the plaintiff’s 22 representations of time expended. Sealy, Inc. v. Easy Living, Inc., 743 F.2d 1378, 1385 (9th Cir. 23 1984). The Court may reduce hours when documentation is inadequate, or when the requested 24 hours are redundant, excessive, or unnecessary. Hensley, 461 U.S. at 433–34. 25 Mr. Letona requests fees for 236.8 hours expended in prosecuting this case. See 26 Supplemental Declaration of Balam O. Letona in Support of Motion for Attorney Fees and Costs 27 (ECF No. 84) ¶ 6, Exh. 5. In support of the request, Mr. Letona submits the following summary of 28 hours, divided into categories of work, and which the Court reproduces below: 7 1 2 Task Hours 3 Pre-Suit Investigation 6.1 4 Drafting Initial Complaint 14.0 5 Motion to Dismiss by Ocwen and OneWest 2.3 6 Drafting Amended Complaints 3.4 – First Amended Complaint 7.8 – Second Amended Complaint 7 8 Discovery, Including Motions Related to 9 Ocwen and OneWest 136.3 Case Management Conference and Filings 5.4 11 United States District Court Northern District of California 10 ADR and Settlement Discussions and Briefs 7.0 12 Miscellaneous (describe) 13 Review and Evaluation of Documents 14 Produced by Ocwen and OneWest 15 Rule 26 Meet and Confer & Preparation 1.7 16 Initial Disclosures Draft and Preparation 7.5 17 Research – Legal and Other 13.5 Meet and Confer to File Second Amended 1.3 18 19 20 21 22 23 24 25 19.8 Complaint Motion to Strike Amended Answer filed by 8.6 Ocwen and OneWest Miscellaneous Client Communication 1.6 Other Miscellaneous Communication & 0.5 Review Total 236.8 26 27 Defendants argue that the amounts billed are unreasonable in light of “Mr. Letona’s 28 8 1 experience in consumer credit litigation and the straightforward nature of this dispute.” Opp. at 4. 2 In support of this argument, Defendants point to certain categories of Mr. Letona’s fee motion. 3 For instance, Defendants argue that the requested 14.0 hours “drafting a basic complaint” is 4 excessive, because the initial Complaint was “along the lines of what Plaintiffs’ counsel has 5 undoubtedly drafted numerous times before.” Id. Defendants also request a reduction in the hours 6 related to Plaintiffs’ meet and confer regarding discovery responses, because they are “beyond 7 excessive,” “given the simple nature of this dispute.” Id. at 4–5. Similarly, Defendants argue that 8 the 19.7 hours spent preparing for the deposition is unreasonable because Mr. Letona “refused to 9 postpone [the deposition] so that the parties could mediate the dispute in late January.” Id. at 5. 10 Defendants request the Court undertake an across-the-board reduction “because a review United States District Court Northern District of California 11 of a sample of individual tasks reveals a pattern of overbilling by at least 50%.” Id. at 6. In 12 support of the argument, Defendants cite to Giovannoni v. Bidna & Keys, No. 06-15640, 255 13 F. App’x 124, 126 (9th Cir. 2007), in which the Ninth Circuit affirmed the district court’s decision 14 to reduce the plaintiff’s counsel’s fee request by half. However, the Ninth Circuit has consistently 15 cautioned against the use of across-the-board fee reductions—or as it described, the “meat axe 16 approach” to “trim[] the fat from a fee application”—when the record does not present 17 complicated or voluminous billing statements. Gates, 987 F.2d at 1399 (citations omitted). 18 Indeed, in cases where the underlying dispute is “not a complicated one,” Ferland v. Conrad 19 Credit Corp., 244 F.3d 1145, 1150 (9th Cir. 2001), nor the billing records “massive,” Gates, 987 20 F.2d at 1399, across-the-board fee reductions are inappropriate, and the Court should instead 21 carefully inspect the billing records to assess the reasonableness of the hours requested. 22 Such is the case here. The Court declines Defendants’ invitation to an across-the-board 23 reduction in hours for two reasons. First, this case does not present the sort of “voluminous” or 24 “massive fee application” that precludes the Court from considering, as a practical matter, the fees 25 requested on an hour-by-hour basis. Indeed, the parties’ competing billing summaries, the 26 Plaintiffs’ billing statements offered as exhibits to their fee application, as well as Plaintiffs’ 27 response to the Court’s April 18, 2016, order requesting clarification for Mr. Letona’s fee request, 28 provide ample guidance for the Court to consider, by task and hour, the hours sought. Second, the 9 1 Court also declines to apply an across-the-board reduction of Plaintiffs’ fees because, besides 2 Defendants’ general contention that the hours billed are excessive, they have given no justification 3 for why, specifically, a fifty percent reduction is warranted. Defendants argue that Plaintiffs’ fee 4 request “reveals a pattern of overbilling by at least 50% . . . as compared to what someone of [Mr. 5 Letona’s] experience and hourly rate would have billed his clients,” Opp. at 6, but provide no such 6 evidence at all for that comparison. In light of the “heightened scrutiny” for across-the-board fee 7 reductions, Gates, 987 F.2d at 1400, Defendants give short shrift to justify why this case merits an 8 across-the-board reduction generally, and why that reduction should be fifty percent, specifically. 9 Accordingly, although the Court recognizes the utility in generalized fee reductions, it declines to 10 United States District Court Northern District of California 11 employ that method in this case to reach Plaintiffs’ reasonable hours. In considering the reasonableness of the hours requested, the Court makes the following 12 observations. Mr. Letona is a consumer protection attorney with over a decade of experience 13 litigating plaintiff-side consumer disputes. Letona Decl. ¶¶ 2–6. His representative matters 14 include involvement in about half a dozen class action lawsuits brought under various consumer 15 protection statutes, including California’s Rees-Levering Motor Vehicle Sales Act, California’s 16 Unfair Competition Law, and the FCRA. Id. ¶¶ 8,9. Given Mr. Letona’s areas of expertise and 17 extensive experience litigating consumer protection disputes, the Court expects that the hours he 18 bills in prosecuting this case reflect a discerning judgment and level of efficiency higher than 19 would an attorney otherwise unfamiliar with this subject matter. This is especially so in light of 20 the fact that this case—when compared to Mr. Letona’s previous representative matters—is 21 relatively uncomplicated and presents only four causes of action brought under two statutes, 22 against three parties. 23 That said, the Court also recognizes that here, counsel for Defendants mounted a stalwart 24 defense over the course of this dispute. The litigation is ill-served when, for instance, a party fails 25 to properly make initial disclosures as required under Rule 26. See Supplemental Letona Decl. 26 ¶¶ 4, 5. As counsel are undoubtedly aware, the failure to disclose witnesses or other discoverable 27 information does not hide the ball completely, but only makes it more difficult for opposing 28 counsel to eventually discover it. Similarly, the lack of a good-faith basis to not meet in person 10 1 about outstanding discovery disputes before filing joint reports unnecessarily expends time and 2 effort for all the parties involved. And in this case, Defendants’ counsel’s refusal to meet face-to- 3 face was in violation of Judge Lloyd’s standing orders. Deposition Order at 2–3. Moreover here, 4 when the parties were eventually able to meet to depose a witness, Ms. Kouvabina at times 5 interposed every other question with long-speaking and coaching objections, to the confusion of 6 not just Plaintiffs’ counsel but also the witness. See, e.g., Supplemental Letona Decl., Exh. 2 at 7 4:11–5:13; 8:10–9:13; 9:19–11:9. Such tactics needlessly prolong the course of litigation and 8 balloon the costs of prosecuting a case—even for a case as relatively uncomplicated as the one 9 here. 10 United States District Court Northern District of California 11 12 13 With this in mind, the Court has reviewed all of the papers submitted, and makes the following modifications to the hours requested. a. Initial Complaint Plaintiffs request 14.0 hours for drafting the initial Complaint. The Court finds this time 14 unreasonable. As discussed above, this case presents a relatively straightforward dispute 15 regarding the alleged false reporting of credit information. The Complaint pleads only four causes 16 of action based on the FCRA and the CCRAA against three defendants, OneWest, Ocwen, and 17 Equifax. In addition, much of the facts alleged in the Complaint occurred during the time when 18 Plaintiffs were represented by prior counsel in their Chapter 13 bankruptcy. Presumably, the 19 records from prior counsel that were necessary to draft this initial Complaint were not difficult to 20 obtain. Given the low degree of complexity presented in this case, the records available from 21 Plaintiffs’ prior litigation, and Mr. Letona’s own experience in litigating consumer credit disputes, 22 the Court finds the 14.0 hours requested for drafting the initial Complaint excessive. The Court 23 decreases the hours requested by 7.0 hours, for a total of 7.0 hours. 24 b. Second Amended Complaint 25 Next, Plaintiffs request 7.8 hours for drafting the SAC. In reviewing the SAC in 26 comparison with the FAC and initial Complaint, the Court finds these requested hours also to be 27 unreasonable. No new claims are added to the SAC; indeed, it still pleads the same four causes of 28 action against the same three Defendants. The only difference between the SAC and FAC is that 11 1 the SAC adds a handful of new allegations regarding two other credit reporting agencies 2 previously unidentified in the FAC or initial Complaint. The Court finds that this minimal 3 addition of new allegations does not warrant the hours requested from Plaintiffs’ counsel. The 4 Court decreases the request by 4.8 hours, for a total of 3.0 hours. 5 c. Discovery-Related Hours 6 By far the lion’s share of hours requested by Plaintiffs’ counsel relates to discovery. Here, 7 Mr. Letona requests 136.3 hours, encompassing work for motions related to Defendants OneWest 8 and Ocwen. Of this sum, 34.5 hours are attributed to time spent drafting discovery responses to 10 Defendants’ requests, and 34.1 hours for time spent reviewing Defendants’ discovery responses to 11 United States District Court Northern District of California 9 Plaintiffs’ requests. The Court recognizes that the time Mr. Letona spent on these tasks may have 12 been prolonged to some degree by Defendants’ position during discovery. However, even with 13 that in mind, the Court finds the combined 68.6 hours to be an inordinate amount of time spent on 14 these two routine discovery tasks. Given Mr. Letona’s subject matter expertise in consumer credit 15 disputes, the Court presumes he is able to capably and efficiently review the records related to 16 Plaintiffs’ consumer credit, as provided by Defendants. Similarly, the responses to Defendants’ 17 discovery requests are unreasonable given the fact that they were nearly identical for each 18 Plaintiff, were mostly boilerplate, and no privilege log was produced in this case. See Kouvabina 19 Decl. ¶ 6. The Court therefore reduces the 34.5 hours by 15.0 hours, for a total of 19.5 hours; the 20 Court reduces the 34.1 hours by 10.0 hours, for a total of 24.1 hours. 21 Plaintiffs request 7.0 hours for time spent meeting with clients and supplementing 22 responses to Defendants’ discovery requests. However, had Plaintiffs provided these responses on 23 time when they were due, no supplementation would have been necessary. Accordingly, the Court 24 reduces the 7.0 hours to 0.0 hours. 25 Next, Plaintiffs request 19.7 hours to prepare for the deposition of the former OneWest 26 employee. Over two and a half full work days spent preparing for a single deposition is simply 27 not reasonable in this circumstance. Mr. Letona, a seasoned litigator, should have been able to 28 prepare for this deposition in a fraction of that time. The Court reduces this request by 11.7 hours, 12 1 2 3 for a total of 8.0 hours. d. Document Review and Initial Disclosures Plaintiffs seek 19.8 hours related to reviewing and evaluating documents produced by 4 Ocwen and OneWest, and 7.5 hours for time spent on preparing and drafting initial disclosures. 5 Again, as discussed above, Mr. Letona is expected to prosecute his cases with discerning judgment 6 and a level of efficiency higher than would an attorney otherwise unfamiliar with this subject 7 matter. Nothing indicates that here, the dispute presented any novel consumer credit issue. An 8 expert in consumer protection disputes, Mr. Letona should have been able to efficiently review the 9 documents produced, and draft disclosures related to this litigation. The Court finds these hours to be excessive, and reduces the 19.8 hours by 4.0 hours, for a total of 15.8 hours, and reduces the 11 United States District Court Northern District of California 10 7.5 hours by 1.5 hours, for a total of 6.0 hours. 12 13 e. Clerical Tasks Finally, Defendant argues that a further reduction in hours is warranted because “Plaintiffs’ 14 counsel’s billing records are either clerical tasks . . . or are so vague and ambiguous that it is 15 difficult to understand and evaluate their nature.” Opp. at 6. As to the portions of Mr. Letona’s 16 hours spent doing tasks that are clerical, the Court agrees with Defendants, and finds that a 17 reduction of 0.7 hours is warranted. Plaintiffs’ counsel is expected to exercise billing judgment. 18 Mr. Letona’s effort spent on these routine administrative tasks—at the rate of $450 per hour—is 19 not a judicious use of his time or of his clients’ money. The Court therefore reduces the 0.7 hours 20 sought for clerical tasks by 0.7 hours, for a total of 0.0 hours. 21 However, as to the hours that Defendants claim are “vague and ambiguous,” the Court 22 notes that “[t]he essential goal in shifting fees . . . is to do rough justice, not to achieve auditing 23 perfection. So trial courts may take into account their overall sense of a suit, and may use 24 estimates in calculating and allocating an attorney’s time.” Fox v. Vice, 563 U.S. 826, 838 (2011); 25 see also Trs. of Dirs. Guild of Am.-Producer Pension Benefits Plans v. Tise, 234 F.3d 415, 427 26 (9th Cir. 2000) (“Plaintiff’s counsel . . . is not required to record in great detail how each minute of 27 his time was expended. But at least counsel should identify the general subject matter of his time 28 expenditures.” (citation omitted)). Here, Mr. Letona clearly meets this standard. He clarified the 13 1 hours he requested by concisely detailing the time spent on each of the sixteen discrete tasks he 2 identified, and by supporting those hours with ample documented evidence. The Court finds these 3 proofs sufficient for purposes of this fees motion. 4 5 f. Hours Attributable to Equifax As a final matter, Defendants argue that Plaintiffs’ requested hours should be reduced to 6 reflect Mr. Letona’s work attributable to Equifax, which had already settled with Plaintiffs in 7 advance. However, Mr. Letona has already resubmitted modified records reflecting billing hours 8 excluding work that had included Equifax. See (ECF No. 84), Exh. 5. As Mr. Letona attested in 9 his declaration, those billing records have been reduced by one-third. Id. ¶¶ 4, 5. Mr. Letona supports these reductions with billing statements as evidence. Id. Exh. 5. The Court finds these 11 United States District Court Northern District of California 10 reductions in hours reasonable. 12 In all, combining the above reductions results in an exclusion of 61.7 hours from Mr. 13 Letona’s request for 236.8 hours, for a total award of 175.1 hours. The Court finds these hours to 14 be reasonable, and summarizes them in the following table, with modifications in bold: 15 16 Task Hours 17 Pre-Suit Investigation 6.1 18 Drafting Initial Complaint 7.0 19 Motion to Dismiss by Ocwen and OneWest 2.3 20 Drafting Amended Complaints 3.4 – First Amended Complaint 3.0 – Second Amended Complaint 21 22 Discovery, Including Motions Related to 23 Ocwen and OneWest 24 Case Management Conferences and Filings 5.4 25 ADR and Settlement Discussions and Briefs 7.0 26 Miscellaneous (describe) 27 Review and Evaluation of Documents 91.9 15.8 28 14 Produced by Ocwen and OneWest 2 Rule 26 Meet and Confer & Preparation 1.7 3 Initial Disclosures Draft and Preparation 6.0 4 Research – Legal and Other 13.5 5 Meet and Confer to File Second Amended 1.3 6 Complaint 7 Motion to Strike Amended Answer filed by 8 Ocwen and OneWest 9 Miscellaneous Client Communication 1.6 10 Other Miscellaneous Communication & 0.5 11 United States District Court Northern District of California 1 Review 12 Total 8.6 175.1 13 14 15 16 17 Accordingly, in carefully reviewing all the papers submitted with this Motion, the Court finds that a reasonable amount of time spent prosecuting this case is 175.1 hours. iii. Lodestar Calculation Next, the Court must determine the lodestar figure by multiplying the hourly rate with the 18 number of reasonable hours spent on this case. Based on the foregoing discussion, the total 19 lodestar calculation is summarized in the following table. 20 21 22 23 Mr. Letona’s Hourly Rate Hours Requested Hours Excluded Hours Awarded Total Tentatively Awarded $450 236.8 61.7 175.1 $78,795 24 25 26 iv. Lodestar Multiplier Plaintiffs have not requested a lodestar multiplier, and have therefore not rebutted the 27 “strong presumption” that the lodestar figure represents a reasonable fee. See D’Emanuele, 904 28 F.2d at 1384 (9th Cir. 1990) (“Such upward or downward adjustments are the exception rather 15 1 than the rule since the lodestar amount is presumed to constitute a reasonable fee.” (citing United 2 Steelworkers of Am. v. Phelps Dodge Corp., 896 F.2d 403, 406 (9th Cir. 1990); Jordan v. 3 Multnomah Cty., 815 F.2d 1258, 1262 9th Cir. 1987)); see also Ketchum, 24 Cal. 4th at 1138 4 (“[T]he party seeking a fee enhancement bears the burden of proof.”). The Court therefore finds 5 the lodestar figure to be reasonable, and not subject to enhancements or reductions. In opposition to this Motion, Defendants argue that Plaintiffs’ lodestar figure should be 6 7 reduced because the request for fees is disproportionate to their eventual recovery. Opp. at 6–8. 8 Specifically, Defendants argue that the lodestar should be reduced by a magnitude proportional to 9 the $50,000 that the case ultimately settled for in the Rule 68 offer of judgment. Id. Citing to an out-of-district case, Valentine v. Equifax Info. Servs. LLC, 543 F. Supp. 2d 1232, 1236 (D. Or. 11 United States District Court Northern District of California 10 2008), Defendants argue that “the lack of evidence of any concrete harm suffered by Plaintiffs,” 12 and that “[n]o finding of liability was made by the Court in this case by means of a verdict, finding 13 of fact, or other ruling,” warrant a reduction in kind of the lodestar figure, even after reaching Mr. 14 Letona’s reasonable hourly rate and the reasonable number of hours expended here. See Opp. at 15 6–8. 16 Defendants’ reliance on Valentine is misplaced and uninstructive in this case. In 17 Valentine, the District of Oregon found that a twenty percent reduction of the lodestar amount was 18 justified because of the plaintiff’s only partial success in litigating that matter. Id. (“I find that 19 because plaintiff emphasized her punitive damages claim but was unsuccessful in obtaining relief 20 on that claim, an across-the-board reduction of the lodestar is appropriate.”). The court therefore 21 awarded the plaintiff a reduced fee, “in light of the jury verdict.” Id. This case, however, presents 22 no such circumstance. The Rule 68 offer of judgment is a total resolution of all claims in this 23 case, and Plaintiffs’ counsel is entitled to all reasonable fees in connection with prosecuting this 24 matter. Cf. Hensley, 461 U.S. at 436 (stating that reductions may be appropriate where the 25 plaintiff achieves only partial or limited success). 26 In any case, the Supreme Court has also held that fees may not be reduced on the basis of 27 “proportionality” alone. City of Riverside v. Rivera, 477 U.S. 561 (1986). As it explained in 28 Rivera, “[t]he amount of damages a plaintiff recovers is certainly relevant to the amount of 16 attorney’s fees to be awarded,” but only if it is “one of many factors that a court . . . consider[s] in 2 calculating an award of attorney’s fees.” Id. at 574. Rivera expressly rejected the notion that 3 attorney’s fees “should necessarily be proportionate to the amount of damages . . . actually 4 recover[ed].” Id.; see also Fair Hous. of Marin v. Combs, 285 F.3d 899, 908 (9th Cir. 2002). 5 Here, in light of the $50,000 settlement and the broad injunctive relief in this case, the Court 6 cannot say that the fees awarded are unjustified. See, e.g., Garcia v. Resurgent Capital Servs., 7 L.P., No. C-11-1253 EMC, 2012 WL 3778852, at *10 (N.D. Cal. Aug. 30, 2012) (describing the 8 plaintiff’s $50,000 recovery in a Fair Debt Practices Collection Act dispute as an “excellent 9 result,” and rejecting the defendants’ argument to reduce the $213,606.65 fee award based on 10 “proportionality”). The Court therefore rejects Defendants’ argument that Plaintiffs’ lodestar 11 United States District Court Northern District of California 1 figure should be reduced based on the amount for which this matter eventually settled. 12 13 14 15 Accordingly, for the reasons discussed above, the Court GRANTS AS MODIFIED Plaintiffs’ Motion for attorney’s fees in the amount of $78,795. v. Mediation Statements As a final matter, Defendants argue that they should be permitted to disclose statements 16 made in the course of the parties’ July 20, 2015, court-sponsored mediation to show the Court 17 “that litigation of this case past mediation resulted in no added value to Plaintiffs.” Id. at 8. 18 Alternative Dispute Resolution Local Rule 6–12 sets forth a general prohibition on 19 disclosure of information from the court-sponsored mediation, subject to narrow exceptions 20 permitting disclosure. The Commentary to the Rule explains that limited circumstances may 21 nonetheless exist in which the general prohibition on disclosure may give way to a countervailing 22 need to reveal the information. See ADR L.R. 6–12, Commentary (stating that “[t]he law may 23 provide some limited circumstances in which the need for disclosure outweighs the importance of 24 protecting the confidentiality of a mediation”). Such circumstances include threats of death or 25 substantial bodily injury, use of mediation to commit a felony, right to effective cross examination 26 in a quasi-criminal proceeding, duty to report lawyer misconduct, and the need to prevent manifest 27 injustice. See id. A court presented with such a circumstance to disclose mediation statements 28 may engage in a balancing test: “Accordingly, after application of legal tests which are 17 1 appropriately sensitive to the policies supporting the confidentiality of mediation proceedings, the 2 court may consider whether the interest in mediation confidentiality outweighs the asserted need 3 for disclosure.” See id. 4 Defendants argue that here, they should be permitted to inform the Court of the amount 5 Plaintiffs demanded during settlement negotiations because “disclosure is ‘need[ed] to prevent 6 manifest injustice’ resulting from Defendants’ inability to demonstrate to the Court that litigation 7 of this case past mediation resulted in no added value to Plaintiffs (as opposed to their counsel).” 8 Opp. at 8. As support, they rely on Munoz v. J.C. Penney Corp., 2009 WL 975846, at *3–4 (C.D. 9 Cal. Apr. 9, 2009), in which the district court permitted the disclosure of settlement communications. However, that case bears little resemblance to the circumstances here, as the 11 United States District Court Northern District of California 10 disclosure permitted in Munoz served the narrow purpose of establishing removal jurisdiction. Id. 12 at *3. Munoz permitted this exception to the mediation privilege in the context of Federal Rule of 13 Evidence 408, which has been interpreted to permit the disclosure of mediation statements 14 “simply to show that the amount in controversy is met,” and not “used to prove liability.” Id. at 15 *3–4 (citing Cohn v. Petsmart, Inc., 281 F.3d 837 (9th Cir. 2002); Babasa v. Lenscrafters, Inc., 16 498 F.3d 972 (9th Cir. 2007)). Here, unlike in Munoz, the request for disclosure is premised on 17 ADR Local Rule 6-12(b), and goes directly to the heart of the substance in this Motion. 18 Defendants’ reliance on Munoz as support for their argument that disclosure of mediation 19 statements is necessary is inapposite. 20 Having considered Defendants’ arguments, the Court summarily rejects Defendants’ 21 request to disclose Plaintiffs’ mediation statements. The “need to prevent manifest injustice” 22 exception to the mediation privilege is not a catch-all for parties to invoke whenever they feel the 23 disclosure of mediation statements may serve their interests. Defendants have given no persuasive 24 justification for why, in this case, manifest injustice would prevail in the absence of permission 25 from the Court to disclose Plaintiffs’ mediation statements. The desire to reduce Defendants’ 26 exposure in this fee motion is no justification at all for the exception, and it certainly falls far short 27 of an interest that outweighs the purposes well-served by mediation confidentiality. Accordingly, 28 the Court denies Defendants’ request to disclose statements made in the course of the parties’ July 18 1 2 3 20, 2015, mediation. B. Costs In addition, Plaintiffs request costs in the amount of $2,211.03 for prosecuting this case. 4 Reply at 10. Defendants argue that Plaintiffs’ request should be denied because Mr. Letona failed 5 to file a bill of costs pursuant to Civil Local Rule 54-1. Opp. at 10. Plaintiffs respond to this 6 oversight by explaining that “[c]ounsel believed that both the FCRA and the [CCRAA] allows for 7 the recovery of expenses obviating the need for a cost memo,” and that should the Court find the 8 need for a bill of costs, Plaintiffs should be granted leave to file one. Reply at 10. 9 This District’s Civil Local Rule 54-1(a) provides that “[n]o later than 14 days after entry of judgment or order under which costs may be claimed, a prevailing party claiming taxable costs 11 United States District Court Northern District of California 10 must serve and file a bill of costs.” In addition, subsection (c) addresses the waiver of costs: 12 “Any party who fails to file a bill of costs within the time period provided by this rule will be 13 deemed to have waived costs.” Civ. L.R. 54-1(c). In an FCRA case, the Ninth Circuit has 14 affirmed a district court’s order denying a party’s request for costs because of the failure to timely 15 file a bill of costs, as was required under the fourteen-day timeline set forth in the district’s civil 16 local rules. See Grove v. Wells Fargo Fin. California, Inc., 606 F.3d 577, 582 (9th Cir. 2010); 17 accord Lytle v. Carl, 382 F.3d 978, 989 (9th Cir. 2004) (affirming district court’s partial denial of 18 costs due to untimely filing a bill of costs under the civil local rules). In Lytle, the Ninth Circuit 19 explained that “[l]ack of diligence by [the plaintiff’s] counsel led to the late filing, and [the 20 plaintiff] cites no persuasive authority that the local rule should not have been enforced.” Id. 21 Courts in this district have held the same. See, e.g., Stein v. Pac. Bell, No. C 00 2915 SI, 2007 WL 22 2221054, at *1 (N.D. Cal. Aug. 1, 2007) (explaining that the defendant’s failure to timely file a 23 bill of costs was deemed a waiver); San Francisco Bay Area Rapid Transit Dist. v. Spencer, 24 No. C 04-04632 SI, 2007 WL 1450350, at *14 (N.D. Cal. May 14, 2007) (denying a party’s 25 request for $122,966.24 in costs because it failed to timely file a bill of costs). 26 Mr. Letona admits to a lack of diligence as his reason for failing to timely file a bill of 27 costs. Reply at 10. But, that reason by itself is not sufficient to relax the fourteen-day requirement 28 mandated by Civil Local Rule 54-2(a). Moreover, he relies on a Central District of California case 19 1 to argue that “out-of-pocket expenses normally charged to a client may be recoverable even if not 2 taxable.” Id. (citing Wyatt Tech. Corp. v. Malvern Instruments, Inc., No. CV 07-8298 ABC 3 (RZX), 2010 WL 11404472, at *2 (C.D. Cal. June 17, 2010)). But, Wyatt lends no support to Mr. 4 Letona’s argument because that case involved the award of statutorily-authorized costs for both 5 taxable and non-taxable litigation expenses, an issue not present here. Id. at *1–2. In addition, 6 Wyatt contemplated the applicability of fee-shifting provisions in three separate statutes—the 7 Copyright Act, the Lanham Act, and the California Trade Secrets Act—all of which are, of course, 8 not at issue here. Id. Because Plaintiffs fail to cite any persuasive authority why the local rules 9 should not be enforced, the request for costs is DENIED. 10 United States District Court Northern District of California 11 IV. ORDER For the foregoing reasons, IT IS HEREBY ORDERED that Plaintiffs’ Motion for Fees and 12 Costs is GRANTED IN PART AS MODIFIED, and DENIED IN PART. Plaintiffs shall recover 13 attorney’s fees in the amount of $78,795; Plaintiffs’ request for costs is DENIED. 14 15 16 17 Dated: June 7, 2016 ______________________________________ BETH LABSON FREEMAN United States District Judge 18 19 20 21 22 23 24 25 26 27 28 20