Raymond Heck v. Kenneth Buhler , 601 F. App'x 239 ( 2015 )

Case: 14-30752 Document: 00512927497 Page: 1 Date Filed: 02/05/2015
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
February 5, 2015
No. 14-30752
Lyle W. Cayce
Clerk
RAYMOND E. HECK; DOUG HAMLEY; CHARLES MOORE; JOSEPH
MCKEARN; ALLEN RICHARDSON,
Plaintiffs - Appellees
v.
WAYNE TRICHE,
Defendant - Appellant
Appeal from the United States District Court
for the Middle District of Louisiana
USDC No. 3:07-CV-21
Before DENNIS, PRADO, and HIGGINSON, Circuit Judges.
PER CURIAM:*
Defendant-Appellant Wayne Triche challenges the legal basis for the
award of attorney’s fees to plaintiffs following the district court’s entry of
judgment imposing liability for violations of the Louisiana Securities Law. We
AFFIRM.
* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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BACKGROUND
The facts underlying this appeal are set forth in the related case, Heck
v. Triche, -- F.3d --, 2014 WL 7335023 (5th Cir. Dec. 23, 2014), in which this
court affirmed Triche’s liability for securities fraud under La. Rev. Stat. Ann.
§§ 51:712 & 51:714. Id. at *1, *10. Relevant to this appeal, soon after a trial
in which a jury found Triche liable for securities fraud, plaintiffs moved for
attorney’s fees pursuant to § 51.714(A) and Local Rule 54.2. Triche opposed on
the basis that plaintiffs failed to submit documents as required by Rule 54.2.
The district court dismissed the motion without prejudice to refile once post-
trial motions had been ruled on. After the district court ruled on the post-trial
motions—holding that Triche was liable under state law, not federal law—
plaintiffs re-filed their motion for attorney’s fees, again pursuant to state law
and Rule 54.2. Plaintiffs requested an award of attorney’s fees in the amount
of forty percent of the total recovery, but offered to submit the report required
by Rule 54.2 if the district court directed. Triche again opposed because
plaintiffs had not complied with Rule 54.2, and also requested that the district
court exercise its discretion and not award attorney’s fees. The district court
denied the motion without prejudice and instructed plaintiffs to re-file their
motion in compliance with Rule 54.2. Plaintiffs then submitted timesheets for
their two attorneys. Triche opposed this submission, arguing that the
handwritten nature of the timesheets and significant redactions made it
impossible for the court to determine reasonable attorney’s fees.
Armed with the timesheets, the district court ruled that attorney’s fees
were available pursuant to 15 U.S.C. § 78r and determined the reasonable
hours, applying a significant reduction because of the deficiencies in the
timesheets. Despite these findings, the district court did not award attorney’s
fees because plaintiffs submitted no information regarding the appropriate
hourly rate. Plaintiffs then filed declarations from their two attorneys, and
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three other attorneys, attesting to the reasonableness of a rate of $300 per hour
for securities litigation in the Middle District of Louisiana. Triche opposed on
the grounds that the declarations were conclusory. The district court granted
plaintiffs’ motion and awarded attorney’s fees in the amount of $121,800.
Triche timely appealed.
DISCUSSION
I.
“We review a district court’s award of attorney’s fees for abuse of
discretion and its supporting factual findings for clear error.” Foreman v.
Dallas Cnty., Tex., 193 F.3d 314, 318 (5th Cir. 1999). The conclusions of law
underlying the award are reviewed de novo. Id. at 318–19.
II.
Triche makes two related arguments on appeal, both concerning the
district court’s reliance on 15 U.S.C. § 78r in awarding attorney’s fees. First,
Triche argues that § 78r cannot support a fee award because no defendant is
alleged to have filed any document with the SEC in relation to this case, a
prerequisite for § 78r’s applicability. Second, Triche contends that plaintiffs
cannot recover attorney’s fees under a federal statute, even if one were
applicable, because the district court found Triche liable under state, not
federal, law. 1 Neither argument warrants reversal.
15 U.S.C. § 78r provides for liability, including reasonable attorney’s
fees, if a defendant makes, or causes to be made, a false or misleading
statement in a document filed with the Securities and Exchange Commission.
15 U.S.C. § 78r(a); see also Magna Inv. Corp. v. John Does One Through Two
Hundred, 931 F.2d 38, 39 (11th Cir. 1991); In re Enron Corp. Sec., Derivative
1 A large portion of Triche’s brief is devoted to restating his arguments regarding the
jury instructions and sufficiency of the evidence. These issues have already been decided by
this court and may not be relitigated. See Heck, 2014 WL 7335023.
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& “ERISA” Litig., 540 F. Supp. 2d 800, 813 (S.D. Tex. 2007) (holding that § 78r
requires a plaintiff to show, in part, that a document filed with the SEC
contained a false or misleading statement). Plaintiffs did not allege that Triche
or any of his co-defendants filed any statement with the SEC. Rather, the
document containing misrepresentations was provided directly to a handful of
investors. Heck, 2014 WL 7335023, at *1. Section 78r is therefore inapplicable
and the district court erred in basing the attorney’s fees award on it.
However, this error does not warrant reversal because state law provides
for attorney’s fees for Triche’s state law violations. Under § 714(A), any person
who violates § 712(A) is liable to the buyer of the security and the buyer may
sue to recover the consideration paid “and reasonable attorney’s fees.” La. Rev.
Stat. Ann. § 51:714(A); see also Rauscher Pierce Refsnes, Inc. v. Flatt, No. 95-
1667 (La. App. 4 Cir. 2/29/1996); 670 So. 2d 537, 542 (holding that § 714(A)
“authorizes the awarding of attorney’s fees as an element of damage”). A
defendant who controls a person liable under § 714(A) “is liable . . . to the same
extent as the person liable under [§ 714(A)].” La. Rev. Stat. Ann. § 51:714(B).
Triche’s co-defendant, Raymond Buhler, was liable under § 714(A). Heck, 2014
WL 7335023, at *13. Triche was found to have controlled Buhler, and was
liable under § 714(B). Id. at *15, 17. Plaintiffs therefore may recover
reasonable attorney’s fees from Triche. See Doucet v. First Fed. Guar., No. 11-
9 (La. App. 5 Cir. 8/30/11); 72 So. 3d 478, 484–85 (awarding attorney’s fees for
a violation of § 714); cf. United States v. Tello, 9 F.3d 1119, 1132 (5th Cir. 1993)
(“[W]e are authorized to affirm a district court’s proper conclusion reached on
the wrong reason if a correct reason exists . . . .”).
Plaintiffs consistently requested attorney’s fees pursuant to state law
and never requested fees pursuant to § 78r. At no point in the district court
proceedings did Triche challenge the statutory availability of attorney’s fees
under either federal or state law. Triche’s arguments were limited to the
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adequacy of proof of the hours worked and the reasonable rate for services.
Even after the district court issued its ruling stating that attorney’s fees were
available under § 78r, Triche did not question the availability of attorney’s fees.
He submitted an opposition dealing only with sufficiency of the proof and did
not challenge the district court’s reliance on § 78r. Triche therefore runs into
this court’s well-trodden precedent that “arguments not raised before the
district court are waived and cannot be raised for the first time on appeal.”
LeMaire v. La. Dep’t of Transp. & Dev., 480 F.3d 383, 387 (5th Cir. 2007). Even
on appeal, Triche does not contend that state law does not permit recovery of
attorney’s fees.
III.
Having determined that attorney’s fees are available under state law, we
review the reasonableness of the fee award for abuse of discretion. See
Foreman, 193 F.3d at 318. Because the district court awarded fees pursuant
to a federal statute, it applied the federal standard. First, it calculated a
“lodestar” fee “by multiplying the reasonable number of hours expended on the
case by the reasonable hourly rates for the participating lawyers,” Migis v.
Pearle Vision, Inc., 135 F.3d 1041, 1047 (5th Cir. 1998), and second, it
considered whether to adjust the lodestar amount by reference to the twelve
factors set forth in Johnson v. Ga. Highway Express, Inc., 488 F.2d 714, 717–
19 (5th Cir. 1974). Although the district court did not employ the state
standard, we find that it did not abuse its discretion in determining the amount
of reasonable attorney’s fees. Under Louisiana law, the lodestar method is not
required, and courts take into account a similar, though not identical, list of
factors in determining a reasonable fee award. See Rivet v. State Dep’t. of
Transp. & Dev., 96-0145 (La. 9/5/96); 680 So. 2d 1154, 1161–62. Triche did not
object to the district court’s use of the lodestar method in the district court and
did not raise any of the Johnson or Rivet factors as reasons why the award
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should be adjusted. Even on appeal, Triche challenges only the district court’s
basis for the availability of attorney’s fees; he does not challenge the
reasonableness of the district court’s calculation. The district court credited
only the hours for which there was adequate documentation, and required the
submission of declarations regarding a reasonable hourly rate in the relevant
market. It also considered the Johnson factors and concluded that none
warranted an adjustment from the lodestar amount. Having considered the
Rivet factors, we find that the district court did not abuse its discretion in
calculating attorney’s fees.
CONCLUSION
For the foregoing reasons, we AFFIRM the district court’s award of
attorney’s fees.
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