United States District Court, S.D. Indiana, Indianapolis Division
ORDER
Hon.
Jane Magnus-Stinson, Chief Judge.
Plaintiff
Debora Walton[1] held several loans and bank accounts at
Defendant First Merchants Bank (“FMB”),
and initiated this litigation in June 2017 alleging various
claims. After ruling on the parties' cross-motions for
summary judgment, two claims remained for trial - a claim
under the Telephone Consumer Protection Act
(“TCPA”), and a claim under Regulation E
of the Electronic Funds Transfer Act
(“EFTA”). After holding a two-day bench
trial, the Court found in favor of FMB on both of Ms.
Walton's claims and also found that FMB was entitled to
attorneys' fees[2] incurred in connection with its Regulation
E claim from November 28, 2018 - the date of the Court's
summary judgment ruling - forward. [Filing No. 286.]
The Court ordered FMB to submit a Report outlining the
attorneys' fees incurred after November 28, 2018 solely
in connection with Ms. Walton's Regulation E claim by
December 20, 2019, Ms. Walton to file any response to
FMB's Report by January 8, 2020, and FMB to file any
reply by January 15, 2020. The parties have done so, and the
issue of the amount of attorneys' fees to which FMB is
entitled is now ripe for the Court's decision.
I.
Discussion
FMB
submitted a Report and Affidavit of John F. McCauley, Counsel
of Record for [FMB], in Support of Fee Request on Defense of
Regulation E Claim (the “Report”), in
which Mr. McCauley sets forth his experience and the
experience of his colleagues who have worked on this case,
and summarizes the work that was performed. [Filing No.
301.] Mr. McCauley states that “FMB has tried
diligently to determine the exact amount of fees dedicated
solely to the Reg. E claim, as opposed to Ms. Walton's
claim under the TCPA. It is clear from the time entries and
the evidence at trial, that it is not a 50/50 split between
the Reg. E and TCPA claims. More time, energy and resources
were directed at defeating the TCPA claim…. For those
time entries that are not clearly delineated as time spent
solely working on Reg. E. related issues, FMB has discounted
those entries by 80%, or otherwise billed only 20% of the
time for those entries.” [Filing No. 301 at
4.] Mr. McCauley sets forth two examples of instances
where entries did not clearly delineate between the two
claims and the entry was reduced by 80%. [Filing No. 301
at 4-5.] He notes that, after the Court's summary
judgment ruling, FMB's counsel did not bill any time
related to the Regulation E claim until May 5, 2019.
[Filing No. 301 at 3-4.] Mr. McCauley attaches
invoices and a chart reflecting $57, 751.00 in attorneys'
fees incurred by FMB in connection with the Regulation E
claim from May 5, 2019 forward. [Filing No. 301 at
5; Filing No. 301-1; Filing No.
301-2.]
In
response to FMB's Report, Ms. Walton filed a document
titled “The Plaintiff Deborah Walton Objects to
Defendant First Merchants Bank[']s Attorney Fees and
Responds to the Defendant[']s Report and Attorney Fee
Invoices” (the “Response”).
[Filing No. 302.] In her Response, Ms. Walton sets
forth some of the same arguments she made in her second Trial
Brief regarding FMB's request for attorneys' fees,
[Filing No. 281].[3] She also argues that “Plaintiff
brought her claim for violation of Regulation E, for which
the relevant statute limits an award to [$1, 000] for each
violation. A claim, by Defendant's Bank, of
attorneys' fees in the amount of [$57, 751.00] grossly
exceeds the potential claim, and does not justify
three…attorneys for preparation.” [Filing
No. 302 at 4.] Ms. Walton contends that “in the
face of three counts, each with a total maximum recovery of
[$1, 000], Defendant seeks attorney fees for
three…attorneys in an amount some twenty…times
Plaintiff's total possible recovery. This is grossly
unreasonable and would have a chilling effect on other
plaintiffs who might seek redress in our Courts.”
[Filing No. 302 at 6.] Ms. Walton requests that the
Court “deny the Defendants motion for Attorney
Fees….” [Filing No. 302 at 6.]
In its
reply, FMB argues that Ms. Walton did not address a single
time entry, the reasonableness of the hourly rates charged,
or the reasonableness of the 80% discount for Regulation
E-related work. [Filing No. 304 at 1-2.] FMB states
that Ms. Walton “attempts to reweigh the evidence
produced at trial…, takes issue with nearly every
finding and conclusion by this Court, and attempts to blame
FMB for her current predicament.” [Filing No. 304
at 2.] It goes on to address why the award of
attorneys' fees was appropriate. [Filing No. 304 at
2-4.] Finally, FMB argues that the amount of
attorneys' fees requested is not disproportionate to the
potential value of the Regulation E claim, noting that Ms.
Walton sought actual damages, statutory damages, punitive
damages, and attorneys' fees in connection with that
claim and demanded $250, 000, or $50, 000 “for each
checking and loan account closed, and miscellaneous damages
or costs.” [Filing No. 304 at 4; see also
Filing No. 303-1.]
The
Court notes at the outset that it already found in its
Findings of Fact and Conclusions of Law that “the award
of attorneys' fees incurred by FMB in connection with Ms.
Walton's Regulation E claim from November 28, 2018 - the
date of the Court's summary judgment ruling - forward is
warranted.” [Filing No. 286 at 20-21.]
FMB's Report, Ms. Walton's Response, and FMB's
reply were to only address whether the amount of
attorneys' fees requested by FMB is “reasonable in
relation to the work expended and costs.” Indeed, the
Court - anticipating, based on the history of this
litigation, that Ms. Walton might address issues outside of
these parameters - stated in its Findings of Fact and
Conclusions of Law that “Ms. Walton must file any
response to FMB's Report, which addresses only
whether the attorneys' fees set forth by FMB are
‘reasonable in relation to the work expended,'
by January 8, 2020.” [Filing No. 286 at 21
(emphasis added).] The majority of Ms. Walton's response
is devoted to arguing why she believes the award of
attorneys' fees is unwarranted in the first instance,
which is beyond the scope of the issues that remain before
the Court and which the Court already addressed in its
Findings of Fact and Conclusions of Law. [SeeFiling No.
286 at 21 (Court discussing Ms. Walton's arguments
that she had difficulty obtaining documents from FMB during
discovery, that FMB did not send her a letter as required by
Fed.R.Civ.P. 11 before seeking attorneys' fees,
[4] and
that FMB did not explicitly raise the inapplicability of
Regulation E in its summary judgment briefing).]
The
only arguments Ms. Walton sets forth in her Response that
relate to the amount of attorneys' fees FMB requests are
that it was excessive for three attorneys to work on the
Regulation E claim, and that the amount of attorneys'
fees is disproportionate to the amount she could have
recovered on the Regulation E claim. These are the only two
arguments the Court will address, as they are the only
arguments relevant to whether the attorneys' fees that
FMB requests are “reasonable in relation to the work
expended.” 15 U.S.C. § 1693m(f) provides that
“[o]n a finding by the court that an unsuccessful
action under this section was brought in bad faith or for
purposes of harassment, the court shall award to the
defendant attorney's fees reasonable in relation to the
work expended and costs.” The Court finds that the
attorneys' fees requested by FMB meet the standard set
forth in § 1693m(f). First, Ms. Walton argues that her
Regulation E claim “does not justify
three…attorneys for preparation, ” [Filing
No. 302 at 4], yet she does not explain why that is the
case. Indeed, the records submitted by FMB indicate that five
attorneys worked on the Regulation E claim. [SeeFiling
No. 301-2.] The Court finds nothing inherently
unreasonable with the use of multiple attorneys in this case,
and notes that the attorney with the highest hourly rate -
David Tittle - spent considerably less time working on the
Regulation E claim than the combined time of the other
attorneys. [SeeFiling No. 301-2.] Had he been the
only attorney working on the case, the total attorneys'
fees would have been much higher. The use of three (or five)
attorneys does not, in and of itself, warrant a reduction in
the amount of attorneys' fees requested, and there is no
evidence that any of the work was duplicative.
Second,
Ms. Walton argues that she was limited to an award of $1, 000
for each Regulation E violation, and the amount of
attorneys' fees requested “grossly exceeds the
potential claim.” [Filing No. 302 at 4.] But
Ms. Walton ignores the fact that, along with those statutory
damages, she sought actual damages, and attorneys' fees
and costs in connection with her Regulation E claim.
[Filing No. 15 at 4; Filing No. 15 at 7;
Filing No. 303-1 at 2 (Ms. Walton stating in a
“Settlement Demand” to FMB that “[f]or
violation of Regulation E, [FMB] is liable to Walton for her
actual damages, statutory damages, her reasonable attorney
fees, and costs”).] For “liability under
Regulation E, she demanded “[a]s damages for violation
of Regulation E, …[$250, 000], or [$50, 000] for each
checking and loan account closed, and miscellaneous damages
or costs.” [Filing No. 303-1 at 3.] She also
stated that she was entitled to “attorney/consultant
fees, ” which totaled $163, 785.00 as of the date of
her settlement demand. [Filing No. 303-1 at 3.] In
light of Ms. Walton's demand in connection with her
Regulation E claim, attorneys' fees of $57, 751 to defend
that claim are not unreasonable in relation to the work
expended.
Because
Ms. Walton has not contested specific time entries or hourly
rates, the Court need not sift through each time entry and
determine whether it was reasonable. See Fox v.
Vice, 563 U.S. 826, 838 (2011) (Courts “need not,
and indeed should not, become green-eyeshade accountants. The
essential goal in shifting fees (to either party) is to do
rough justice, not to achieve auditing perfection”).
Having found that it was not unreasonable for FMB to use
multiple attorneys, and that the amount of attorneys'
fees was not disproportionate to the amount that Ms. Walton
sought in connection with her Regulation E claim, the Court
finds that $57, 751.00 in attorneys' fees is
“reasonable in relation to the work expended.” 15
U.S.C. § 1693m(f).
II.
Conclusion
For the
foregoing reasons, the Court finds that FMB is entitled to
$57, 751.00 in attorneys' fees under 15 U.S.C. §
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