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Sprint Communications Company L.P. v. Crow Creek Sioux Tribal Court

United States District Court, D. South Dakota, Southern Division

March 30, 2017

SPRINT COMMUNICATIONS COMPANY L.P., Plaintiff,
v.
CROW CREEK SIOUX TRIBAL COURT, NATIVE AMERICAN TELECOM, LLC., and B. J. JONES, in his official capacity as special judge of Tribal Court; Defendants.

          DETERMINATION OF REASONABLE ATTORNEYS' FEES

          KAREN E. SCHREIER UNITED STATES DISTRICT JUDGE

         In this court's February 16, 2016 Memorandum Opinion and Order (Docket 281), the court awarded plaintiff, Sprint Communications Company, damages on its Count 1 against defendant, Native American Telecom (NAT). The court also held that Sprint was entitled to reasonable attorney's fees under 47 U.S.C. § 206. Docket 281 at 10. Sprint filed a Motion to Determine Reasonable Attorney's fees. Docket 326. NAT filed a Memorandum opposing Sprint's motion. Docket 337.

         FACTS

         The facts of this case are more fully set forth in the court's August 7, 2015 order granting in part and denying in part cross motions for summary judgment from both parties. See Docket 250. But a short summary of the facts are as follows:

         Sprint provides nationwide long-distance telephone services and is known under the telecommunications regulatory framework as an interexchange carrier (IXC). Sprint delivers long-distance calls to a local exchange carrier (LEC) for termination to end-users. Under the FCC's current regulatory framework, Sprint pays the LEC a terminating access charge based on the LEC's interstate access tariff, which is filed with the FCC.

         In October 2008, the Crow Creek Sioux Tribal authority authorized NAT to provide telecommunications service on the Crow Creek Reservation subject to the tribe's laws. Under the 2008 approval order, NAT began to operate as an LEC. NAT also operates a free conference calling system (used for conference calling, chat-lines, and similar services) in connection with Free Conferencing Corporation (Free Conferencing). A party using NAT's services does not pay NAT for the conference call, but rather is assessed charges by the party's telecommunications provider. NAT then bills the telecommunications provider an access fee as defined in its interstate tariff. NAT's access charges, which were billed to Sprint for conference calls, are at issue here.

         After paying two of NAT's bills for charges connected to conference calls, Sprint ceased paying NAT's terminating access tariffs because Sprint believed that NAT was involved in a traffic-pumping scheme, otherwise known as access stimulation, to generate traffic from free conference calls and chat services. On August 16, 2010, Sprint filed suit against NAT alleging a breach of the Federal Communications Act (FCA) and a state-law unjust enrichment claim. Docket 1.

         On March 8, 2011, NAT amended its answer and asserted counterclaims against Sprint alleging a breach of contract and a collection action under its tariffs, a breach of implied contract resulting from a violation of its tariffs, and a quantum meruit/unjust enrichment claim. NAT also sought declaratory relief. Docket 99. On February 22, 2012, this court granted Sprint's then-pending motion to stay this proceeding and referred three issues to the FCC for resolution. Docket 141 at 25. This court also directed the parties to issue periodic updates describing the status of the FCC proceeding. Because of the limited progress on the FCC referral, a telephonic status conference was held on July 23, 2014. See Docket 164. During the status conference, the court proposed entering an order that would lift the stay, withdraw the issues that had been referred to the FCC, and establish deadlines for the parties to amend the complaint, counterclaims, and to file any motions to dismiss. Docket 169 at 12. The court also stated that it would rule on any motions to dismiss based on a statute of limitations defense and that a new referral of issues to the FCC could then be discussed. Id. With the parties in agreement, a formal order was issued that same day. See Docket 168.

         On February 26, 2016, the court awarded Sprint monetary relief on Count I of Sprint's complaint. Docket 281. Because Sprint was awarded monetary damages on Count I, the court determined that Sprint was entitled to an award of reasonable attorney's fees. Id. at 10. A partial judgment in the amount of $29, 565.35 was entered by the court in favor of Sprint on March 17, 2016. Docket 288. On August 4, 2016, the court entered judgment against NAT and in favor of Sprint on the remaining claims. Docket 325. Sprint used Briggs and Morgan, P.A. (Briggs) as outside counsel on this case. Docket 330 at 2. Briggs is a Minneapolis based firm. Docket 327 at 6. Sprint also retained Tommy Tobin, a South Dakota attorney, to assist on the case. Docket 329 at 2.

         DISCUSSION

         Sprint requests a total of $690, 617.25 in attorney's fees for 2, 056.85 hours spent on this litigation. Docket 327 at 2. Sprint contends that this award is the result of a reasonable number of hours spent on the litigation multiplied by a reasonable hourly rate. Id. NAT acknowledges that Sprint is entitled to attorney's fees, but alleges that it must apportion its fees to work done solely on Count I in its Complaint. Docket 337 at 12. Thus, NAT believes that Sprint should only be awarded $10, 000 in attorney's fees. Id. at 14.

         I. Whether Sprint can only recover fees related to Count I.

         NAT first objects to Sprint's requested attorney's fees because it argues that Sprint may only recover attorney's fees related to Count I. This court found that Sprint is entitled to an award of attorney's fees under 47 U.S.C. § 206. Docket 281 at 10. Section 206 of the Communications Act provides:

In case any common carrier shall do, or cause or permit to be done, any act, matter, or thing in this chapter prohibited or declared to be unlawful, or shall omit to do any act, matter, or thing in this chapter required to be done, such common carrier shall be liable to the person or persons injured thereby for the full amount of damages sustained in consequence of any such violation of the provisions of this chapter, together with a reasonable counsel or attorney's fee, to be fixed by the court in every case of recovery, which attorney's fee shall be taxed and collected as part of the costs in the case.

47 U.S.C. § 206.

         Section 206 states that, to be entitled to attorney's fees, a party must be an injured party and the party can only seek attorney's fees on a “case of recovery.” To be an injured party within the meaning of § 206, a party must plead a violation of the FCA and recover damages on its claim under the FCA. See Conboy v. AT&T Corp., 241 F.3d 242, 250-51 (2d. Cir. 2001); Swain v. AT&T Corp., No. 3:94-cv-1088-D, 1997 WL 573464, at *1-2 (N.D. Tex. Sept. 9, 1997); Am. Tel. & Tel. Co. v. United Artists Payphone Corp., 852 F.Supp. 221, 225 (S.D.N.Y. 1994). The definition of an injured party within the meaning of the FCA originates from past decisions relating to the Interstate Commerce Act. AT&T, 852 F.Supp. at ...


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