United States District Court, N.D. Indiana, South Bend Division
SFG COMMERCIAL AIRCRAFT LEASING, INC., as assignee of original Plaintiff 1st Source Bank, Plaintiff,
MONTGOMERY EQUIPMENT COMPANY, INC. and DR. A. THOMAS FALBO, Defendants.
OPINION AND ORDER
THERESA L. SPRINGMANN CHIEF JUDGE
matter is before the Court on Plaintiff's Motion for
Attorneys' Fees, Costs, and Expenses [ECF No. 52], filed
on March 28, 2018. The Defendants have not filed an
objection, and the deadline to do so has passed. For the
reasons stated below, the Motion is GRANTED.
27, 2015, 1st Source Bank, which maintains its principal
place of business in Indiana, filed a Complaint [ECF No. 1]
against Montgomery Equipment Company, Inc. and Dr. A Thomas
Fablo for amounts due under a promissory note [ECF No. 1-1].
The terms of the Loan and Security Agreement, which the
parties agreed would be governed by the laws of the State of
Indiana, provide that the Defendants would pay 1st Source
Bank's legal fees in the event of a default on the
promissory note. Pl.'s Compl. Ex. 2 at ¶¶ 5,
11, ECF No. 1-2. In December 2015, 1st Source Bank assigned
all of its rights, title, and interest in the note to SFG
Commercial Aircraft Leasing, Inc. (SFG), and, on January 7,
2016, the Court substituted SFG for 1st Source Bank as the
party plaintiff [ECF No. 26].
December 2017, SFG filed a motion for summary judgment
against the Defendants [ECF No. 42]. In January 2018, the
Court granted SFG's motion [ECF No. 48]. On March 26,
2018, the Court entered final judgment in favor of SFG in the
amount of $1, 549, 433.39, representing the unpaid principal
and interest under the note, as well as prejudgment interest
in the amount of $99, 652.77 [ECF No. 50]. On March 27, 2018,
the Clerk of Court entered final judgment [ECF No. 51].
March 28, 2018, SFG filed the instant motion pursuant to
Federal Rule of Civil Procedure 54(d)(2) requesting $23,
455.33 in attorneys' fees and costs [ECF No. 52].
Attached to the motion is an affidavit from Alice Springer,
who is SFG's attorney of record [ECF No. 52-1]. Springer,
a partner at Barnes & Thornburg LLP, states that her
clients were billed 64.5 hours at $350 per hour for this
dispute for a total of $22, 575.00 in attorney fees.
Id. ¶¶ 10, 12. She further states that her
client incurred expenses in the amount of $880.33 for filing
fees, service fees, and copying and courier charges.
Id. ¶ 15. Springer concludes that “[w]hen
measured against the total amount owed to SFG, which
exceed[ed] 1.5 million, the fees are reasonable.”
Id. Springer also states that both she and her
co-counsel have “expertise and specialized training in
handling commercial litigation, ” which should be
“taken into consideration in setting the fee.”
Id. ¶ 16. Springer notes that her firm
“submitted invoices for fees incurred through February
28, 2018, the vast majority of which 1st Source has already
paid.” Id. ¶ 13.
pursuant to Federal Rule of Civil Procedure 54(d)(2),
requests $23, 455.33 in attorneys' fees and costs. For
the reasons stated below, the Court grants this request.
Rule of Civil Procedure 54(d)(2) allows a litigant to request
attorneys' fees by motion. Fed.R.Civ.P. 54(d)(2). In
pertinent part, Rule 54(d)(2) requires that the motion be
filed no later than fourteen days after the entry of
judgment, specify the grounds entitling the movant to the
award of attorneys' fees, and state the amount requested.
federal court sitting in diversity applies state substantive
law and federal procedural law. Camp v. TNT Logistics
Corp., 553 F.3d 502, 505 (7th Cir. 2009). Whether a
party is entitled to attorneys' fees as damages under a
breach of contract claim is an issue of substantive law.
Fednav Int'l Ltd. v. Cont'l Ins. Co., 624
F.3d 834, 838-39 (7th Cir. 2010). When neither party raises a
conflict of law issue in a diversity case, the district court
applies the substantive law of the state in which the court
sits, including the state's choice of law rules.
Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487,
496-97 (1941); Citadel Grp. Ltd. v. Wash. Reg'l Med.
Ctr., 692 F.3d 580, 587 n.1 (7th Cir. 2012).
“Indiana choice of law doctrine favors contractual
stipulations as to governing law.” Allen v. Great
Am. Reserve Ins. Co., 766 N.E.2d 1157, 1162 (Ind. 2002).
In this case, the Loan and Security Agreement provides that
the laws of the State of Indiana govern this dispute. See
Pl's Compl. Ex. 2 ¶ 11.
whether SFG is entitled to attorney's fees,
“Indiana adheres to the American rule, under which, in
the absence of a statutory provision or an agreement
providing for fees, each party is required to pay its own
attorney fees.” Osler Inst., Inc. v. Forde,
386 F.3d 816, 818 (7th Cir. 2004). “In Indiana, a
contract that allows for the recovery of reasonable
attorney's fees will be enforced according to its terms
unless it is violative of public policy.” Harrison
v. Thomas, 761 N.E.2d 816, 821 (Ind. 2002). In this
case, the Defendants signed a promissory note with 1st Source
Bank. See Pl.'s Compl. Ex. 1. The terms of the Loan and
Security Agreement provide that the Defendants will pay for
1st Source Bank's legal fees in the event of a default on
the note. Pl.'s Compl. Ex. 2. After the Defendants
defaulted on the note, 1st Source Bank filed the instant
lawsuit and subsequently transferred its rights under the
note to SFG. In December 2017, SFG filed a motion for summary
judgment against the Defendants, which the Court granted. On
March 27, 2018, judgment was entered in favor of SFG. The
next day, SFG filed the instant motion for attorneys'
fees pursuant to Federal Rule of Civil Procedure 54(d)(2).
The Defendants have not objected to the motion for an award
of attorney fees and costs. The Court concludes that SFG is
entitled to reasonable attorneys' fees pursuant to the
terms of the parties' agreements and this Court's
reasonableness of attorneys' fees is a procedural issue
governed by federal law. See Taco Bell Corp. v.
Cont'l Cas. Co., 388 F.3d 1069, 1077 (7th Cir.
2004); Oldenburg Grp. Inc. v. Frontier-Kemper
Constructors, Inc., 597 F.Supp.2d 842, 847 (E.D. Wis.
2009). When governed by a contractual fee shifting clause,
the award of attorneys' fees is determined by standards
of commercial reasonableness. Matthews v. Wis. Energy
Corp., 642 F.3d 565, 572 (7th Cir. 2011). A client's
“willingness to pay is an indication of commercial
reasonableness.” Id. Courts also “look
to the aggregate costs in light of the stakes of the case and
opposing party's litigation strategy.” Id.
“The inquiry into commercial reasonableness does not
require courts to engage in detailed, hour-by-hour review of
a prevailing party's billing records.” Johnson
Controls, Inc. v. Edman Controls, Inc., 712 F.3d 1021,
1027 (7th Cir. 2013) (internal quotation marks omitted). In
her affidavit attached to the instant motion, described
above, SFG's attorney of record provides a summary of her
charges and the amount of work expended on this case and paid
for by the client. The Defendants have not objected to the
requested amount of $23, 455.33. The Court finds that $23,
455.33 in fees and costs, when evaluated against the amount
of the outstanding loan, is commercially reasonable. See
Matthews, Inc., 642 F.3d at 572. Furthermore, the
clients' willingness to pay these fees is a sign of
commercial reasonableness. Id. Accordingly, the
Court grants SFG's request for attorneys' fees and
costs in the amount of $23, 455.33.
on the foregoing, the Court GRANTS the Motion for
Attorneys' Fees, Costs, and Expenses [ECF No. 52] and
ORDERS that Plaintiff SFG is awarded ...