Cruz v. Cuper Electric LLC

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 Brigido Cruz, No. CV-23-01677-PHX-ROS 10 Plaintiff, ORDER 11 v. 12 Cuper Electric LLC, et al., 13 Defendants. 14 15 Pending before the Court is Plaintiff’s Motion for Attorneys’ Fees and Costs 16 (“Motion”) (Doc. 32) seeking $19,414.25 in fees and costs. 17 BACKGROUND 18 Plaintiff filed this suit for unpaid overtime wages under the Fair Labor Standards 19 Act (“FLSA”), the Arizona Minimum Wage Act (“AMWA”), and the Arizona Wage Act 20 (“AWA”). (Doc. 1). Defendants were properly served (Docs. 7-9) but failed to answer or 21 otherwise participate in the action. The Court granted default judgment against all 22 Defendants in the amount of $11,634.00 and against Defendant Cuper Electric LLC in the 23 amount of $15,246.00 (Doc. 28). 24 ATTORNEYS’ FEES 25 I. ENTITLEMENT AND ELIGIBILITY TO FEES 26 Plaintiff requests $11,080.50 in attorneys’ fees and $881.70 in costs in accordance 27 with Federal Rule of Civil Procedure 54, Local Rule of Civil Procedure 54.2, and 28 29 U.S.C. § 216(b)—the FLSA’s fee-shifting provision that “provides for attorney fees and 1 costs to a successful plaintiff.” Haworth v. State of Nev., 56 F.3d 1048, 1050 n.1 (9th Cir. 2 1995). The Court finds Plaintiff is eligible for, and entitled to, attorneys’ fees. 3 The FLSA requires courts to award reasonable attorneys’ fees to successful 4 plaintiffs. 29 U.S.C. § 216(b); see also Houser v. Matson, 447 F.2d 860, 863 (9th Cir. 5 1971) (“[The statute] provides that an award of attorney’s fee ‘shall’ be made to the 6 successful plaintiff. The award of an attorney’s fee is mandatory.”). As the prevailing 7 party in the present FLSA action, (Doc. 16), Plaintiff is entitled to attorneys’ fees. 8 Plaintiff argues he is entitled to attorney fees incurred in preparing the Motion for 9 Attorneys’ Fees and Costs. Mot. at 4. Local Rule of Civil Procedure 54.2(c)(2) requires 10 a plaintiff claiming “entitlement to fees for preparing the motion and memorandum for 11 award of attorneys’ fees” and costs “must cite the applicable legal authority supporting” 12 the request. Plaintiff cites Gary v. Carbon Cycle Arizona LLC, 398 F. Supp. 3d 468, 479 13 (D. Ariz. 2019), as support for the proposition that a “party that is entitled to an award of 14 attorneys’ fees is also entitled to compensation for time expended on an application for 15 attorneys’ fees.” Mot. at 4. The Ninth Circuit has noted “federal courts, including our 16 own, have uniformly held that time spent in establishing the entitlement to and amount of 17 the fee is compensable.” In re Nucorp Energy, Inc., 764 F.2d 655, 659-60 (9th Cir. 1985). 18 And, more specifically, courts have awarded fees incurred in preparing fees motions in 19 other FLSA cases within the District of Arizona. See, e.g., Gary v. Carbon Cycle Arizona, 20 398 F. Supp. 3d 468. 21 The Court finds Plaintiff is entitled to recover fees, including those incurred in 22 preparing the present Motion. 23 II. REASONABLENESS OF REQUESTED AWARD 24 While the FLSA mandates an award of attorneys’ fees to a successful plaintiff, 25 29 U.S.C. § 216(b), “the amount of the award is within the discretion of the court,” Houser 26 v. Matson, 447 F.2d 860, 863 (9th Cir. 1971). Courts “employ the ‘lodestar’ method to 27 determine a reasonable attorney’s fees award.” Kelly v. Wengler, 822 F.3d 1085, 1099 (9th 28 Cir. 2016) (citing Fischer v. SJB–P.D. Inc., 214 F.3d 1115, 1119 (9th Cir. 2000)). Courts 1 calculate the lodestar figure by “multiplying the number of hours reasonably expended on 2 a case by a reasonable hourly rate.” Id. 3 After calculating the lodestar figure, a Court may reduce or increase the award based 4 on a variety of factors. Those factors include: (1) the time and labor required, (2) the 5 novelty and difficulty of the legal questions involved, (3) the skill required to perform the 6 legal service properly, (4) other employment precluded due to acceptance of the case, (5) 7 the customary fee, (6) whether the fee is fixed or contingent, (7) time limitations imposed 8 by the client or the circumstances, (8) the amount involved and the results obtained, (9) the 9 experience, reputation, and ability of the attorneys, (10) the ‘undesirability’ of the case, 10 (11) the nature and length of the professional relationship with the client, and (12) awards 11 in similar cases. Kerr v. Screen Extras Guild, Inc., 526 F.2d 67, 70 (9th Cir. 1975) (“Kerr 12 factors”).1 The lodestar calculation normally subsumes some of these factors such that the 13 Court need not consider them again after determining the lodestar. See Gonzalez v. City of 14 Maywood, 729 F.3d 1196, 1209 (9th Cir. 2013) (identifying factors often considered when 15 calculating lodestar). 16 A. Hourly Rates 17 The first question is whether Plaintiff’s asserted rate is reasonable. “A reasonable 18 hourly rate is ordinarily the prevailing market rate in the relevant community.” Sw. Fair 19 Hous. Council v. WG Scottsdale LLC, No. 19-00180, 2022 WL 16715613 at *3 (D. Ariz. 20 Nov. 4, 2022) (citing Kelly, 822 F.3d at 1099). And “the burden is on the fee applicant to 21 produce satisfactory evidence—in addition to the attorney’s own affidavits—that the 22 requested rates are in line with those prevailing in the community for similar services by 23 lawyers of reasonably comparable skill, experience, and reputation.” Blum v. Stenson, 465 24 U.S. 886, 895 n.11 (1984). 25 Plaintiff’s counsel, Clifford P. Bendau II, is a managing attorney at Bendau & 26 Bendau PLLC with approximately 12 years’ experience as a litigator focusing exclusively 27 1 Local Rule 54.2 also lists factors the Court must address when determining the 28 reasonableness of the requested award. These factors are largely duplicative of the Kerr factors. 1 on plaintiffs’ state and federal employment wage and hour litigation, primarily under the 2 FLSA. Mot. at 11. Plaintiff asserts a $445 billing rate for Mr. Bendau. Id. at 4. Plaintiff 3 supports his proffered rate with an affidavit from Mr. Bendau outlining his experience and 4 stating the $445 rate is reasonable, (Doc. 32-6) and a collection of rate determinations 5 regarding Mr. Bendau in other FLSA cases. (Doc. 32-2, 3, 4, 7, 8). 6 In his affidavit, Mr. Bendau claims he has practiced law for over ten years and has 7 litigated more than 600 employment-related lawsuits in that time. (Doc. 32-6 at 3). In a 8 2023 FLSA case within the District of Arizona, the court approved Mr. Bendau’s $445 per 9 hour rate as reasonable. Ekstrand v. Tru Realty LLC, No. 23-cv-1416, Doc. 17 (D. Ariz. 10 Oct. 20, 2023). This Court recently followed suit, holding Mr. Bendau’s $445 rate 11 reasonable. Aguirre v. Custom Image Pros LLC, No. 23-cv-0419, Doc. 20 (D. Ariz. May 12 15, 2024). According to Mr. Bendau, his $445 rate is commensurate with his experience 13 level and is “well within the standard hourly rates charged by other law firms in the 14 Phoenix” area. (Doc. 32-6 at 4). 15 The Court finds the prevailing rates for FLSA cases in the District of Arizona and 16 Mr. Bendau’s experience support the requested hourly rate. The Court finds the $445 17 hourly rate reasonable. 18 B. Hours Expended 19 Under the lodestar method, the prevailing party is generally entitled to recover fees 20 for “every item of service which, at the time rendered, would have been undertaken by a 21 reasonable and prudent lawyer to advance or protect his client’s interest.” Gary v. Carbon 22 Cycle Ariz. LLC, 398 F. Supp. 3d 468, 486 (D. Ariz. 2019) (quoting Twin City Sportservice 23 v. Charles O. Finley & Co., 676 F.2d 1291, 1313 (9th Cir. 1982)). Courts may “exclude 24 from this initial fee calculation hours that were not reasonably expended.” Hensley v. 25 Eckerhart, 461 U.S. 424, 433-34 (1983) (internal quotations removed); see also McKown 26 v. City of Fontana, 565 F.3d 1097, 1102 (9th Cir. 2009) (“In determining the appropriate 27 number of hours to be included in a lodestar calculation, the district court should exclude 28 hours that are excessive, redundant, or otherwise unnecessary.”). 1 Plaintiff submits a log of time Mr. Bendau expended on the present case 2 (Doc. 32-5). The activity log states Mr. Bendau expended 24.9 hours in total. Id. Having 3 carefully considered the time and labor reasonably required for each task on Plaintiff’s 4 activity log, the Court finds that each of the entries are reasonable. 5 C. Lodestar Figure and Adjustment 6 Having found Plaintiff’s submitted rate and hours reasonable, the Court determines 7 the lodestar figure is $11,080.50 (24.9 hours at a rate of $445). 8 Despite a “strong assumption that the ‘lodestar’ method represents a reasonable 9 fee,” Corrales-Gonzalez v. Speed Auto Wholesalers LLC, 2023 WL 3981139, at *7 (D. 10 Ariz. June 13, 2023), the Court “has discretion to adjust the lodestar upward or downward” 11 based on the Kerr factors not subsumed in the lodestar calculation, Stetson v. Grissom, 821 12 F.3d 1157, 1166-67 (9th Cir. 2016). Courts must assess these factors and must articulate 13 “with sufficient clarity the manner in which it makes its determination.” Carter v. Caleb 14 Brett LLC, 757 F.3d 866, 869 (9th Cir. 2014). The above lodestar analysis subsumes 15 several of these factors, including the time and labor required by counsel, skill required to 16 perform the legal service properly, customary fees in similar matters, and the experience 17 and reputation of counsel. The Court considers the remaining factors here and finds none 18 justify adjusting the lodestar figure. 19 1. Preclusion of Other Employment 20 Plaintiff avers Plaintiff’s counsel “was not significantly precluded from other work 21 because of this representation.” Mot. at 8. The Court finds this factor is neutral. 22 2. Nature of Fee Arrangement 23 Plaintiff asserts he retained counsel on a contingency fee. Mot. at 9. The Court 24 finds this factor supports awarding the full lodestar amount. 25 3. Time Limitations 26 Plaintiff submits there were no time limitations imposed in this case. Mot. at 11. 27 This factor is neutral. 28 / / / 1 4. Results Obtained 2 “Where a plaintiff has obtained excellent results, his attorney should recover a fully 3 compensatory fee.” Hensley v. Eckerhart, 461 U.S. 424, 435-36 (1983). Plaintiff submits 4 counsel “has obtained excellent results” because he recovered “well in excess of the total 5 amount in unpaid wages that Defendants owed him.” Mot. at 11. This factor weighs in 6 favor of awarding the full lodestar amount. 7 5. Novelty and Difficulty of the Claims 8 Plaintiff submits the case involved a “straightforward claim that comes reasonably 9 often before this Court.” Mot. at 8. This factor is neutral. 10 6. Undesirability of the Case 11 Plaintiff argues this case was generally undesirable because it involved low 12 damages, a “speculative amount of available fees,” and the risk of taking on a matter and 13 expending costs without guarantee of recovery. Mot. at 12. While the Court agrees that 14 this factor supports Plaintiff’s award of fees, the Court finds this factor does not justify an 15 adjustment to the lodestar amount. 16 7. Nature of the Attorney-Client Relationship 17 Mr. Bendau has never represented Plaintiff before this case. Mot at 12. This factor 18 is neutral. 19 8. Awards in Similar Cases 20 Finally, the Court considers awards in similar cases. Plaintiff refers to the cases 21 cited for the reasonableness of Mr. Bendau’s hourly fee to demonstrate awards in similar 22 cases. Mot. at 13. In Ekstrand v. Tru Realty LLC, a court awarded an FLSA plaintiff 23 $9,167.00 in attorneys’ fees after default judgment based on a $445 hourly rate. No. 23- 24 cv-1416, Dkt. 17 (D. Ariz. Oct. 20, 2023). The Court finds this case is sufficiently similar 25 to the present case to weigh in favor of awarding the full lodestar amount. 26 9. Final Lodestar Adjustment 27 After consideration, The Court determines the Kerr factors do not justify an 28 adjustment to the lodestar amount. 1 D. Conclusion 2 The Court finds Mr. Bendau’s $445 hourly rate and 24.9 hours spent on the case to 3 be reasonable, yielding a lodestar amount of $11,080.50. No adjustment to the lodestar 4 amount is necessary. Thus, the Court will award attorneys’ fees in the amount of 5 $11,080.50. 6 COSTS 7 In addition to attorneys’ fees, Plaintiff requests $881.70 in out-of-pocket costs, Mot. 8 at 6, detailed in a separate bill of costs (Doc. 33). Reasonable out-of-pocket expenses are 9 awardable as “costs of the action” under the FLSA. See Van Dyke v. BTS Container Serv., 10 Inc., 2009 WL 2997105, at *2 (D. Or. Sept. 15, 2009). The Court finds Plaintiff’s requested 11 out-of-pocket costs—consisting of the complaint filing fee and service costs—reasonable 12 and will award Plaintiff $881.70 in costs. 13 Plaintiff also requests an additional $7,452.05 for anticipated collection efforts. 14 Mot. at 14. In support of this request, Plaintiff states “Plaintiff’s counsel has generally 15 engaged” an outside law firm “to assist them and their clients in efforts to collect” on 16 judgments. Mot. at 16. Plaintiff attaches the agreement between Plaintiff’s counsel and 17 the outside law firm, under which Plaintiff’s counsel pays a $650 retainer and an ultimate 18 “25% contingency fee on all amounts recovered.” Id. 19 The Court recognizes Plaintiff may well need to pay the $650 retainer and 25% of 20 the recovery for collection efforts, but these fees and costs are not ripe to recover before 21 Plaintiff incurs them. See Mumphrey v. Good Neighbor Community Services LLC, No. 23- 22 cv-00923, 2023 WL 8702103, at *5 (D. Ariz. Dec. 15, 2023); Stamper v. Freebird Logistics 23 Inc., No. 22-cv-00155, 2022 WL 4448457, at *4 (D. Ariz. Sept. 23, 2022); Akula v. Airbee 24 Wireless, Inc., No. 08-cv-00421, 2009 WL 122795, at *2 (E.D. Va. Jan. 14, 2009) (denying 25 advance collection fees where “the necessity and amount of future attorney’s fees requested 26 by Plaintiff are too speculative at this point in the collection process”). Any award of 27 collection costs before Plaintiff incurs them is necessarily speculative. Judge Lanza 28 recently concluded not-yet-incurred collections costs are not “speculative” because || plaintiff's counsel had entered into an agreement that promised 25% of the recovery to 2|| another law firm in return for that firm engaging in collection efforts. See Alvarez v. Talaveras Renovations LLC, No. 23-cv-02654, 2024 WL 1195462, at *1—2 (D. Ariz. Mar. 20, 2024). But costs that Plaintiff has not yet incurred, and may never incur, still qualify || as “speculative.” For example, if Defendants learn of the judgment before □□□□□□□□□□□ 6|| counsel engages the other law firm and Defendants immediately remit payment, □□□□□□□□□□ □ 7 || counsel will never incur the additional 25%. But perhaps more importantly, the very nature 8 || of awarding collections costs on the front end is improper. A court can only award 9|| “reasonable” costs and fees. See 29 U.S.C. § 216(b) (“The court in such action shall . . . || allow a reasonable attorney’s fee to be paid by the defendant.”) (emphasis added). Until 11 || fees are incurred, the Court has no way to determine if they were reasonable. Using another example, a judgment of $20,000 would rise to $25,000 under Plaintiff's approach. The 13} other law firm might engage in collection efforts consisting of a single letter. If the defendants then pay the entire judgment, a letter will have cost $5,000, a patently 15 || unreasonable amount. In the end, courts routinely award collections costs after they are || incurred. That is the wiser approach. 17 The Court finds an advance award of $7,452.05 in anticipated collection costs 18 || unreasonable. Plaintiff is free to seek collection costs or additional attorneys’ fees once || Plaintiff actually incurs them. 20 Accordingly, 21 IT IS ORDERED Plaintiff's Motion for an Award of Attorneys’ Fees and Costs 22 || (Doc. 32) is GRANTED IN PART and DENIED IN PART. The Court awards Plaintiff 23 || $11,080.50 in attorneys’ fees and $881.70 in costs. 24 Dated this 13th day of November, 2024. fo `` = 25 — 26 Senior United States District Judge 28 -8-