Free Brief in Support of Motion - District Court of Colorado - Colorado

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Civil Action No. 03-CV-02474-WYD-PAC CHARLOTTE SCHNEIDER and DEAN WYMER, Plaintiffs, v. LANDVEST CORPORATION, a Kansas corporation, And DAVID MASON, individually Defendants. _____________________________________________________________________ Brief in Support of Motion for Attorney's Fees

I.

Plaintiffs are entitled to an award of costs and attorneys fees under 29 U.S.C. § 216(b).

As prevailing plaintiffs in an FLSA action, Plaintiffs are entitled to reasonable attorneys' fees and costs; indeed they are mandatory. 29 U.S.C. § 216(b). Plaintiffs are prevailing parties; they succeeded on both causes of action stated in their Amended Complaint. The purpose of an award of fees and costs under § 216(b) is to "insure effective access to the judicial process by providing attorney fees for prevailing plaintiffs with wage and hour grievances; obviously Congress intended that the wronged employee should receive his full wages . . . without incurring any expense for legal fees or costs." United Slate, Local 307 v. G & M Roofing & Sheet Metal Co., 732 F.2d 495,

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502 (6th Cir. 1984) (internal quotations marks omitted) (quoting Maddrix v. Dize, 153 F.2d 274, 275-76 (4th Cir. 1946). As Congress noted when it enacted the fee-shifting provision in section 1988(b), the purpose behind this measure was not to give private lawyers an unwarranted windfall, but rather to ensure compensation "adequate to attract competent counsel. It goes without saying that if a court's compensation is not adequate to match what the market will bear for a lawyer's services, then competent lawyers will go elsewhere to offer their services. Such a result would do irreparable damage to our system of private enforcement of federal civil rights. Robinson v. City of Edmond, 160 F.3d 1275, 1281 (10th Cir. 1998) (internal quotation marks and citations omitted). A request for attorney's fees should not result in a second major litigation. Hensley v. Eckerhart, 461 U.S. 424, 437 (1983). II. The "lodestar" formula is appropriate under the FLSA for determining a reasonable attorney's fee

Although there do not appear to be any Tenth Circuit cases directly on point, most courts have adopted the lodestar formula for calculating a reasonable fee as developed in Hensley v. Eckerhart, 461 U.S. 424, 428 n.7 (1983) (noting that the "standards set forth in this opinion are generally applicable in all cases in which Congress has authorized an award of fees to a `prevailing party.'"); Singer v. City of Waco, 324 F.3d 813, 829 (5th Cir. 2003) (holding "district court correctly applied the lodestar method in calculating attorney's fees [in FLSA overtime case]."). Cf. Browder v. City of Moab, 427 F.3d 717 (10th Cir. 2005) (applying Hensley lodestar formula for determining reasonable fees under th Clean Water Act); Connolly v. Harris Trust Co. of

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Ca. (In re Miniscribe Corp.), 309 F.3d 1234, 1243 (10th Cir. 2002) ("The lodestar test is presently used as the dominant method for assessing fees in fee-shifting disputes in federal court."). The lodestar calculation is the product of the number of attorney hours "reasonably expended" and a "reasonable hourly rate." Chavez v. Thomas & Betts Corp., 396 F.3d 1088, 1102-103 (10th Cir. 2005) (Title VII). Accord Praseuth v. Rubbermaid, Inc., 406 F.3d 1245, 1257 (10th Cir. 2005) (ADA). "Once an applicant for a fee has carried the burden of showing that the claimed rate and number of hours are reasonable, the resulting product is presumed to be a reasonable fee . . . . " Robinson, 160 F.3d at 1281 (italics added) (quoting Cooper v. Utah, 894 F.2d 1169, 1171 (10th Cir. 1990)). Ultimately, "a court should focus on the significance of the overall relief that the prevailing party has won: The result is what matters." Id. at 1283 (internal quotation marks and citations omitted). A. Plaintiffs' counsels' hourly rates are reasonable

"The standard for determining the reasonableness of hourly rates is what lawyers of `comparable skill and experience practicing in the area would charge for their time.'" Villescas v. Richardson, 145 F. Supp. 2d 1228, 1232 (D. Colo. 2001) (quoting Ramos v. Lamm, 713 F.2d 546, 553 (10th Cir. 1983)), rev'd on other grounds, 311 F.3d 1253 (10th Cir. 2002). In determining reasonable rates, the Court should apply currently rates, not those which may have been customary from the commencement of the litigation. Sussman v. Patterson, 108 F.3d 1206, 1212 (10th Cir. 1997). Craig Cornish's current

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hourly rate is $300.00; Donna Dell'Olio's is $250.00; and Ian Kalmanowitz's is $200.00. These rates are reasonable. See Affidavit of Glenn Schlabs; Compare Villescas v. Richardson, 145 F. Supp. 2d 1228, 1232 (D. Colo. 2001) (Babcock, C.J.) (Holding that $250/hr. is "reasonable in the Denver area for experienced lawyers" in 2001); Lisand Trust v. Ent Fed. Credit Union, 2001 U.S. Dist. LEXIS 1413 at * 3 (D. Colo. Jan. 17, 2001) (Babcock, C. J.) (Holding $260/hour for attorney "who has been practicing civil litigation for approximately thirteen years" to be "reasonable in the prevailing market."). B. Degree of success

The two claims Plaintiffs brought arose out of a common core of facts. They were successful on both counts. Where a plaintiff has obtained excellent results, his attorney should recover a fully compensatory fee. Normally this will encompass all hours reasonably expended on the litigation, and indeed in some cases of exceptional success an enhanced award may be justified . . . . The result is what matters. Hensley v. Eckerhart, 461 U.S. 424, 435 (1983). See also Villescas, 145 F. Supp. 2d at 1233 ("When a plaintiff achieves most or all of what he aimed for in a civil rights lawsuit, his lawyer should receive a fully compensatory fee.") (internal quotation marks and citations omitted). Plaintiffs succeeded on both causes of action as stated in their Amended Complaint. They also succeeded in changing the record keeping practices at Landvest, a result which inures to the benefit of a class of current and future resident managers.

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While Defendants claimed at trial (through Jeff Etter) that there was no change in record keeping practices, a memo (Trial Exhibit A 35) was sent to resident managers instructing them to record "actual hours" worked on September 30, 2003. Trial Exhibit A 35 (Memo of September 30, 2003) followed notice of the instant litigation by just 3 weeks. See Ex. 5. Letter to Landvest from Donna Dell'Olio, dated September 2, 2003.) No other event was disclosed by Landvest which would explain the change in policy other than the instant lawsuit. C. Time spent is reasonable

"An aggressive litigation strategy carries with it certain risks, one of which is that a party pursuing an aggressive strategy may, if it loses, find itself required to bear a portion of the attorneys' fees incurred by the other party in responding to that aggressiveness." Praseuth v. Rubbermaid, Inc., 406 F.3d 1245, 1260 (10th Cir. 2005) (ADA). The Tenth Circuit has long accepted the proposition that one of the factors useful in evaluating the reasonableness of the number of attorney hours in a fee request is the responses necessitated by the maneuvering of the other side. The Supreme Court has also recognized that part of an attorney's calculus of the amount of time reasonably necessary for a case is the vigor which the opponents bring to the dispute. See Riverside v. Rivera, 477 U.S. 561, 580 n.11, 106 S. Ct. 2686, 91 L. Ed. 2d 466 (1986) (plurality opinion) ("'The government cannot litigate tenaciously and then be heard to complain about the time necessarily spent by the plaintiff in response.'"). The evidence of the hours expended by defense counsel is not, of course, an immutable yardstick of reasonableness, and it may be disregarded or discounted as a comparative factor if found to be unreasonable in its own right. However, here the effort expended by the defendants suggests at least that they viewed the case as sufficiently complex and serious to warrant the expenditure of large amounts of attorney -5-

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time, and it highlights the tooth-and-nail litigating approach the city used in this case. In light of this tenacious effort by the city and its lawyers, the amount of attorney time expended by the plaintiffs begins to look more reasonable, not less. Robinson v. City of Edmond, 160 F.3d 1275, 1284 (10th Cir. 1998). The defense team at Kutak Rock, consisting of at least four lawyers who filed pleadings in the case, launched an aggressive defense for Landvest. Not only did Mr. Rupe take the full seven hours allowed for the deposition of Charlotte Schneider, Kutak Rock attempted to obtain all of her financial, educational and employment records. This was an aggressive and even intimidating defense of a case where the fact issue was how many hours she spent working in an office. See Ex. 1, (Defendants' First Set of Requests for Production to Plaintiff Charlotte Schneider, Requests # 5,17, 18, 19 and Authorizations for Release of Records); Ex. 2, (Deposition of Charlotte Schneider, March 15, 2004, 226:6-230:7). The defense strategy was to respond to discovery requests in a manner which provided little or no information to the Plaintiffs. For example, Plaintiffs never got a straight answer to an interrogatory asking how Plaintiffs' overtime rate was calculated. Interrogatory No. 1, served February 2, 2004 asked "Please explain how the overtime rate was calculated using Charlotte Schneider's pay as an example." This simple request led to multiple objections and three different answers none of which were responsive. See Ex. 3 (Various objections and supplemental answers to Interrogatory No. 1.) Another strategy of the defense team was to raise every possible objection to Plaintiffs' requests for discovery. Some of the more absurd examples are attached as -6-

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Ex. 4. Plaintiffs do not mean to complain or fault Defendants' attorneys for an aggressive defense strategy. However, where aggressive and non responsive discovery is the strategy, litigation consumes more attorney time and becomes more expensive. Defendants could have disposed of this case early on for a small amount of money. Ex. 5 (Letters to Landvest and Alan Rupe from Donna Dell'Olio, dated September 2, 2003 and February 2, 2004). Defendants chose to spend tens of thousands of dollars on an aggressive defense. They never offered a cent to settle the case. This too was their right; however, the decision to litigate was theirs and the full cost of the litigation must be borne by Landvest and David Mason not shifted to the Plaintiffs' attorney. Plaintiffs' counsel have exercised "billing judgment" by excluding $3,372.50 in attorney's fees for time devoted to the Motion to Authorize Notice. Plaintiffs' counsel has also not included in her request time spent on prefiling investigation, research and correspondence with the Defendants. The Affidavit of Donna Dell'Olio explains the decision to withdraw the Motion to Authorize Notice. To the extent time spent can be exclusively allocated to the contract claim, it is compensable also under the fee-shifting terms of MEA. D. Lodestar number

Based on the lodestar calculation, the Court should make the following fee

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awards: Craig Cornish Donna Dell'Olio Ian Kalmanowitz E. _____ $100,757.50 ______ _____ ______ ______

Lodestar adjustments 1. No reduction for partial success

Since Plaintiffs were fully successful on their claims, there is no need to consider reduction for partial success. 2. Excellent results merit fully compensable award

As noted above, excellent results deserve an excellent award. Hensley, supra. and Villescas, supra. Plaintiffs' counsel has not requested a multiplier. Compare Connolly v. Harris Trust Co. of Ca. (In re Miniscribe Corp.), 309 F.3d 1234, 1243 (10th Cir. 2002) (upholding 2.57 multiplier). Plaintiffs' counsel doesn't believe that she should have to demonstrate "excellent" results in order to obtain a full award of fees. Plaintiffs were successful, their counsel should be awarded reasonable fees which fairly compensate her for her work and do not penalize her for taking the case by discounting the value of her work. 3. Undesirability of this case justifies fully compensable award

In determining whether to make an upward or downward adjustment to the lodestar, courts may consider the Johnson v. Georgia Highway Express, Inc. factors provided they do not duplicate facts subsumed in the lodestar calculation. Houlihan -8-

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Lokey Howard & Zukin Capital v. Unsecured Creditors' Liquidating Trust (In re Commer. Fin. Servs.), 427 F.3d 804, 811 (10th Cir. 2005). One Johnson factor that is not part of the lodestar in this case is the undesirability of the case. Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 719 (5th Cir. 1974). In the vast majority of overtime cases under the FLSA, the amount of wages owed are far too small to attract competent counsel on a contingent fee basis based on a percentage of the award. The attorneys' fee award is the only financial incentive to enforce the overtime provision in an individual case. It would undermine the policy behind fee awards to reduce the fee award in successful litigation below the lodestar. A lawyer considering whether to take on an overtime case must defer compensation for several years and anticipate advancing the costs of the litigation. She should not also be expected to assume the risk that her fee will be reduced. Such a financial disincentive will leave victims of overtime violations without competent representation. The United States Department of Labor, Wage and Hour Division is not up to the task of effectively litigating all violations.1 Private actions are, as Congress recognized when it enacted § 216, an essential part of the legislative scheme.

See e.g. Brennan Center for Justice, Economic Policy Brief No. 2, Sept. 2005, Trends in Wage and Hour Enforcement by the U.S. Department of Labor, 1975-2004 (showing that between 1975 and 2004, while the number of workers covered by the federal wage and hour laws grew by 55%, and the number of establishments grew by 112%, the number of Wage and Hour investigators declined by 14%, the number of completed compliance actions declined by 36%, and the number of workers who received back wages declined by 24%).(www.brennancenter.org last visited 2/19/06). -9-

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This case illustrates the economic disincentive to most lawyers to take a case where the clients have been denied a few thousand dollars. Plaintiffs' lawyers expended many hours in order to get the Plaintiffs the wages they were due under the FLSA. They advanced substantial costs. Their fees have been deferred for over 2 years, and with an appeal probably another year. F. Plaintiffs are entitled to expenses normally billed to a client

Under § 216(b), Plaintiffs are entitled to broader recoupment of expenses than are allowed under Fed. R. Civ. P. 54(d), and 28 U.S.C. § 1920. Smith v. Diffee FordLincoln-Mercury, Inc., 298 F.3d 955, 969 (10th Cir. 2002).2 The following out-of-pocket expenses are customarily billed to the client: 1. 2. 3. 4. Computer research.3 All deposition costs. All costs of reproducing documents. Costs of investigation paid to private investigators.

See Affidavits of Cari Frederick and Glenn Schlabs. G. Fees on the fee application

Plaintiffs' counsel should also be awarded fees incurred in preparing, drafting, and litigating this motion. See Glass v. Pfeffer, 849 F.2d 1261, 1266 n.3 (10th Cir. 1988) (As See also, Praseuth v. Rubbermaid, Inc., 406 F.3d 1245, 1259 (10th Cir. 2005) (Affirming fee award that includes "items that are normally itemized and billed in addition to the hourly rate as "other expenses" included in fee allowances in civil rights cases, if reasonable in amount."); Brown v. Gray, 227 F.3d 1278, 1296-298 (10th Cir. 2000) (1983) (discussing same).
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Camargo v. Tramwell Crow Interest Co., 318 F. Supp. 2d 448 (E.D. Tex. 2004) (Computerized legal research is compensable as part of a reasonable attorney's fee). -10-

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the Third Circuit has stated: "It is obviously fair to grant a fee for time spent litigating the fee issue, at least if the fee petitioner is successful and his claim as to a reasonable fee is vindicated, since it is the adversary who made the additional work necessary." This circuit is in accord.) (citations omitted); Hernandez v. George, 793 F.2d 264, 269 (10th Cir. 1986) ("This court generally allows recovery of fees for attorneys' work in seeking attorneys' fees. Compensating attorneys for work in resolving the fee issue furthers the purpose behind the fee authorization in § 1988 which is to encourage attorneys to represent indigent clients and to act as private attorneys general in vindicating federal civil rights policies."); Martin v. University of South Alabama, 911 F.2d 604, 610 (11th Cir. 1990) (EPA); King v. Palmer, 906 F.2d 762, 769 (D.C. Cir. 1990) (Title VII); Cooper Industries, 640 F. Supp 1374, 1376 (W.D. N.C. 1986) (Title VII). Conclusion For the foregoing reasons Plaintiffs request that their actual out-of-pocket expenses be awarded and that their counsel's full fees be awarded. Respectfully submitted this 28th day of February, 2006. CORNISH & DELL'OLIO

s/ Donna Dell'Olio Donna Dell'Olio, #10887 Ian D. Kalmanowitz, #32379 431 N. Cascade Avenue, Suite 1 Colorado Springs, CO 80903 Phone: (719) 475-1204 Fax: (719) 475-1264 E-mail: [email protected] Attorneys for Plaintiffs

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CERTIFICATE OF SERVICE I hereby certify that on this 28th day of February, 2006, I electronically filed the foregoing Brief in Support of Motion for Attorney's Fees with the Clerk of Court using CM/ECF system which will send notification of such filing to the following e-mail addresses: Alan Rupe Stacia G. Boden Heather Davis [email protected] [email protected] [email protected]

s/Esther Kumma Abramson Esther Kumma Abramson

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