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Atmosphere Hospitality Management, LLC v. Curtullo

United States District Court, District of South Dakota, Western Division

March 11, 2015

ATMOSPHERE HOSPITALITY MANAGEMENT, LLC, Plaintiff,
v.
ZELJKA CURTULLO, Defendant, and SHIBA INVESTMENTS, INC. and KARIM MERALI, Defendants and Third-Party Plaintiffs,
v.
JAMES HENDERSON, Third-Party Defendant.

ORDER GRANTING SANCTIONS ON PLAINTIFF’S DOCKET NO. 131 MOTION TO COMPEL [DOCKET NO. 187]

VERONICA L. DUFFY, United States Magistrate Judge

INTRODUCTION

This matter is before the court on plaintiff Atmosphere Hospitality Management, LLC’s complaint, filed pursuant to the court’s diversity jurisdiction, 28 U.S.C. § 1332. Now pending is a motion for sanctions [Docket No. 187] on plaintiff’s previously-filed motion to compel, Docket No. 131. The district court, the Honorable Karen E. Schreier, referred this motion to this magistrate judge for decision. See Docket No. 165.

FACTS

Plaintiff filed a motion to compel the attendance of Sacha Merali, Batool Merali, and Zeljka Curtullo at depositions and for costs, attorney’s fees and sanctions in connection with those depositions. See Docket No. 131. In ruling on the motion, the court granted plaintiff’s motion fully as to Sacha Merali, granted plaintiff’s motion partially as to Zeljka Curtullo, and denied plaintiff’s motion as to Batool Merali. See Docket No. 172. The court found that Sacha Merali was a managing agent which the corporate defendant had a duty to produce for a deposition. Id. The court held that defendants and their attorney should pay sanctions for the three depositions plaintiff noticed for Sacha at which Sacha did not appear. Id. Defendants alone were ordered to pay for the attorney’s fees associated with making the motion to compel. Id.

As to Zeljka Curtullo, the court found no sanctions were applicable for plaintiff’s attempts to serve Curtullo with the amended complaint and summons, but sanctions were awardable for Curtullo’s failure to attend her duly noticed deposition after service of process. Id. The court held that defendants and their attorney should pay sanctions for this failed deposition attempt. Id. Defendants alone were ordered to pay for the attorney’s fees associated with making the motion to compel. Id.

The court found no sanctions were proper in connection with plaintiff’s attempts to depose Batool Merali. Id. Batool was neither an officer nor a managing agent of the corporate defendant nor was she a named party to this litigation. Id.

Plaintiff has now filed its motion for attorney’s fees and costs. See Docket No. 187. Defendants resist that motion. See Docket No. 201.

DISCUSSION

A. Lodestar Method of Determining Reasonable Award of Attorney's Fees

Plaintiff must carry the burden to establish a factual basis for the award of fees and costs it requests and the court must evaluate plaintiffs request for attorney's fees to determine whether it is reasonable. See Johnston v. Comerica Mortg. Corp., 83 F.3d 241, 246 (8th Cir. 1996). "Because any award [of attorney’s fees] has the potential for 'precedential value' in future cases, the Court owes a duty to the principled development of the law to exercise careful judgment in reviewing agreed-upon [or undisputed] fees." Duhaime v. John Hancock Mut. Life Ins. Co., 989 F.Supp. 375, 379 (D. Mass. 1997) (citing Weinberger v. Great N. Nekoosa Corp., 925 F.2d 518, 526 (1st Cir. 1991)).

The appropriate amount of attorney’s fees is highly fact-specific to the case. There are two methods of determining attorney’s fees: the lodestar method and the "percentage of the benefit" method. See H.J. Inc. v. Flygt Corp., 925 F.2d 257, 259-60 (8th Cir. 1991); Comerica Mortg. Corp., 83 F.3d at 246; Walitalo v. Iacocca, 968 F.2d 741, 747-48 (8th Cir. 1992). The court has discretion to decide which method of determining fees is appropriate. Comerica Mortg. Corp., 83 F.3d at 246. Here, the parties address only the lodestar method, so the court chooses to employ that method.

The lodestar is figured by multiplying the number of hours reasonably expended by the reasonable hourly rates. Finley v. Hartford Life & Accident Ins. Co., 249 F.R.D. 329, 332-33 (N.D. Cal. Feb. 22, 2008); Tequila Centinela, S.A. de C.V. v. Bacardi & Co., Ltd., 248 F.R.D. 64, 68 (D.D.C. 2008); Creative Resources Group of New Jersey, Inc. v. Creative Resources Group, Inc., 212 F.R.D. 94, 103 (E.D.N.Y. 2002); Kayhill v. Unified Gov't. of Wyandotte County, 197 F.R.D. 454, 459 (D.Kan. 2000); and Trbovich v. Ritz-Carlton Hotel Co., 166 F.R.D. 30, 32 (E.D. Mo. 1996). The burden is on the moving party to prove that the request for attorney’s fees is reasonable. Tequila Centinela, S.A. de C.V., 248 F.R.D. at 68; Creative Resources Group, Inc., 212 F.R.D. at 103; Kayhill, 197 F.R.D. at 459.

Once the lodestar is calculated, there are twelve factors that are relevant in considering whether that figure ...


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