2012-00116773-CU-FR

Calvin Mountjoy vs. Bank of America Home Loans

Nature of Proceeding:    Motion for Attorney Fees

Filed By:   Henderson, Dennise S.

Plaintiffs Calvin and Tracy Mountjoy’s (“Plaintiffs”) Motion for Attorneys’ Fees and
Costs as against Defendants Bank of America, N.A. (“BofA”), Mortgage Electronic
Registration Systems, Inc. (“MERS”); Recontrust Company, N.A. (“Recontrust”) and
Fannie Mae (“Fannie Mae”) (collectively, “Defendants”), is GRANTED IN PART and
DENIED IN PART as described below.

Tentative Ruling Language

The notice of motion does not provide notice of the Court’s tentative ruling system as
required by with C.R.C., Rule 3.1308 and Local Rule 1.06(D). Local Rules for the
Sacramento Superior Court are available on the Court’s website. Counsel for moving
party is ordered to notify opposing party immediately of the tentative ruling system and
to be available at the hearing, in person or by telephone, in the event opposing party  appears without following the procedures set forth in Local Rule 1.06(B).

This minute order is effective immediately.  No formal order pursuant to CRC rule
3.1312 or other notice is required.

Background

Plaintiffs filed this foreclosure lawsuit in January of 2012.  At the pleading stage, there
was one demurrer, which was overruled.  Defendants represent that, in regards to
discovery, two depositions were taken, Defendants served no discovery requests,
Plaintiffs propounded a single request for production with six requests, and there was
no motion practice related to discovery.  (Def.’s Oppo. at 1.)  Defendants’ motion for
summary judgment was granted in part and overruled in part on January 2, 2014.
Following a mandatory settlement conference on January 29, 2014, the matter settled,
and as part of the settlement, Defendants agreed to pay Plaintiffs’ attorneys’ fees and
costs.  However, the parties did not agree on any particular fee award amount.

Plaintiffs now seek an attorneys’ fees award of $308,425.00 based on 760.70 attorney
hours worked.  (Pl.’s Ps & As at 6; Declaration of Dennise Henderson (“Henderson
Decl.”) ¶ 53, Exh. D to Henderson Decl. (billing entries).)  Plaintiffs argue that a
“reasonable hourly rate [of] $450 for Ms. Henderson as lead counsel and $350 per
hour for Ms. Nygren as associate counsel” is a reasonable basis for the requested fee
award.  (Pl.’s Ps & As at 7-8.) Plaintiffs also ask the Court to apply a multiplier of 4.0
(4x) on grounds that this case involved complex and novel issues.  (Pl.’s Ps & As at
10.)  With the requested fees and requested 4.0 multiplier, Plaintiffs seek a total of
$1,272,864.24 for 760.7 hours of attorney time.  Plaintiffs also seek $9,791.06 in costs.
(Henderson Decl. ¶ 58; Exh. E to Henderson Decl.)

Defendants argue that these fees are excessive both in terms of time spent and in
terms of the reasonableness of counsel’s hourly rates.  (Def.’s Oppo. at 5-10.)
Defendants argue that Plaintiffs’ attorneys engaged in double billing, padded billing
and improper block billing.  (Id. at 10-16.) Defendants also argue that no multiplier
should be applied here, because the issues in this case were not particularly complex
or novel.  (Id. at 16-17.)  Defendants argue that $3,561.16 of these costs are not
awardable under Code of Civil Procedure 1033.5.  (Id. at 18.)

Discussion

Defendants do not dispute that Plaintiffs’ are entitled to their attorneys’ fees pursuant
to the parties’ settlement agreement and that such attorneys’ fees award must be
determined by the lodestar method.  (Pl.’s Ps & As at 7; Def.’s Oppo. at 5.)  The
Court’s Register of Actions reflects that the Court granted Plaintiff’s Motion to Compel
Enforcement of Settlement Agreement on April 4, 2014 and ordered entry of judgment
against Defendants pursuant thereto.  Accordingly, as framed by the parties, the only
issue before the Court is whether the requested fees and costs are reasonable.

In determining the reasonableness of a fee award, the Court is required to calculate
the lodestar amount, i.e., the reasonable number of hours expended in this matter
multiplied by the reasonable hourly rate.  (PLCM Group Inc. v. Drexler (2000) 22
Cal.4th 1084, 1094.)  The reasonable market value of the attorney’s services is the
measure of the reasonable hourly rate.  (Id.)  The lodestar figure may then be adjusted
based on consideration of factors specific to the case.  (Id.)

The Court will reduce the hours it determines were excessive or not supported.  (Levy
v. Toyota Motor Sales, U.S.A., Inc. (1992) 4 Cal.App.4th 807, 816 (party seeking
attorney fees has the “burden of showing that the fees incurred were ‘allowable,’ were
‘reasonably necessary to the conduct of the litigation,’ and were ‘reasonable in
amount'”); Christian Research Institute v. Ahor (2008) 165 Cal.App.4th 1315, 1326-29
(affirming award for 71 hours of attorney time in case where attorneys sought fees for
over 600 hours).)  Fee award amounts are matters within the trial court’s discretion:
the “trial judge is the best judge of the value of professional services rendered in his
court, and while his judgment is of course subject to review, it will not be disturbed
unless the appellate court is convinced that it is clearly wrong.”  (Ketchum v. Moses
(2001) 24 Cal.4th 1122, 1132; accord PLCM Group, 22 Cal.4th at 1096.)

Hours Worked

Defendants note that Plaintiffs’ counsel filed the pending motion without meeting and
conferring regarding attorneys’ fees and costs, which could be construed as a breach
of the settlement agreement.  (Def.’s Oppo. at 6 n.6.)  The Court makes no
determination regarding whether Plaintiffs’ counsel’s conduct in this regard breached
of the settlement agreement.

Defendants challenge the large disparity between defense fees incurred on this case
(224.1 hours for $51,064.16 in total fees) and Plaintiffs’ fees (760.7 hours for
$308,425.00 in total fees).  (Def.’s Oppo. at 9.)  Defendants “do not solely request that
the Court deny” the fees motion “in its entirety, as it was the intent of the parties to
discuss reasonable attorneys’ fees and remit payment” pursuant to their settlement
agreement. (Def.’s Oppo. at 6.)  Instead, Defendants urge the Court to reduce
Plaintiffs’ requested fees.

The Court agrees with Defendants that the billing records reveal that Plaintiffs’
attorneys spent excessive time on various routine tasks, that Plaintiffs’ two attorneys
billed for completing the same tasks and communications, and that Plaintiffs’ attorneys
billed for non-attorney work, all as itemized specifically in Defendant’s Opposition.
(Def.’s Oppo. at 10-14.)

Plaintiffs’ attorneys seek fees for excessive time spent on routine tasks, and excessive
time should not be compensated.  (See Ketchum, 24 Cal.4th at 1132, 1138.)  For
example, counsel purportedly spent 41.5 hours to draft the pleading (totaling $18,675
in fees).  (Exh. D to Henderson Decl. at 36-38).  The Court takes judicial notice of the
pleading on file in this case, and on the Court’s review, approximately 25 pages of the
55 pages of allegations are generic background “allegations” – perhaps, more
accurately, arguments – regarding MERS, the securitization of loans, the financial crisis
and the roles of lenders, etc., not factual allegations tailored to Plaintiff’s claims in this  particular case.  The Court agrees with Defendants that it was unnecessary to spend
over 40 hours on a pleading largely comprised of improper legal argument and generic
background “facts.”  Similarly, counsel spent almost 150 hours to oppose a motion for
summary judgment (totaling $67,410 in fees). (Exh. D to Henderson Decl. at 15-22.)
The Court takes judicial notice of the Opposition and supporting documents and
agrees with Defendants that 150 hours was excessive, especially given the defects in
the construction of most of the 35 “facts” presented in Plaintiffs’ Separate Statement of
Additional Material Facts, which included lengthy deposition excerpts and verbose
multi-part argument framed as “fact.”  Further, counsel spent over 20 hours to draft
and serve a two-page deposition notice ($9,112.50 in fees) (Exh. D. to Henderson
Decl. at 26-27), over 11 hours to review a 112 page deposition transcript ($5,287.50 in
fees), over 11 hours to review 41 pages of document production (Exh. D to Henderson
Decl. at 20, 23-4), 2.75 hours to shepardize Defendants’ Answer  (the Court takes
judicial notice of the Answer and agrees with Defendants that it does not offer any
cited cases supporting Defendants admissions/denials, making it unclear what
shepardizing could have been done) ($1,237.5 in fees) (Exh. D to Henderson Decl. at
29).  The Court agrees with Defendants that excessive time was spent on these and
other routine tasks itemized in Defendants’ Opposition at 10-11.

Plaintiffs’ attorneys also seek fees for non-attorney work or for otherwise
“unreasonable” tasks, such as: 2 hours for filing and serving a demurrer (Exh. D to
Henderson Decl. at 31) when the Court’s records confirm that Plaintiffs did not file or
serve a demurrer in this action, 5.5 hours to prepare an amended complaint (id. at 30)
when the Court’s records reveal that no amended complaint was filed, 8.75 hours
researching “settlement,” 3.5 hours consulting with an unnamed expert on unnamed
issues (id. at 28), among other tasks itemized in Defendants’ Opposition at 12-14.)
The Court agrees with Defendants that fees spent on these tasks constitute
“unreasonable” fees.

Plaintiffs’ attorneys also seek duplicative fees, with attorneys Henderson and Nygren
both billing for many of the same tasks, as itemized in Defendants’ Opposition at 12.

Finally, Plaintiffs’ counsel largely “block billed” and often completed only the most
general and vague descriptions of their time entries.  (Exh. D to Henderson Decl.)  As
Defendants note, over 150 entries are of this nature: “call with client,” “meet w/ Tracy,”
“meet w/ Calvin,” “call with TN,” “return calls,” “consult with expert,” “EM response,”
“review EM from Clayton,” “EM from Clayton,” etc.  (Exh. D to Henderson Decl.)
“Block billing, while not objectionable per se . . . exacerbated the vagueness of
counsel’s fee request, a risky choice since the burden of proving entitlement to fees
rests on the moving party.”  (Christian Research, 165 Cal.App.4th at 1325-26.)
Further, “[a]n attorney’s chief asset in submitting a fee request is his or her credibility,”
and “vague, block-billed time entries inflated with noncompensable hours” can “destroy
an attorney’s credibility with the trial court.”  (See id.)

By failing to address any of Defendants’ arguments through a timely Reply brief,
Plaintiffs have not met their burden of showing that the challenged billing entries are
reasonable despite Defendant’s challenges thereto.

Accordingly, the Court exercises its discretion to reduce the number of compensable
hours to be used in the lodestar calculation.  (See id. at 1329 (“counsel may not submit
a plethora of noncompensable, vague, block-billed attorney time entries and expect
particularized, individual deletions as the only consequence. The trial court could
reasonably conclude counsel made no effort to prune the fee request to comply with
the law” and could permissibly do an across-the-board reduction of hours). )  The
Court has reviewed counsel’s billing entries and considered Defendants’ challenges
thereto, which Plaintiffs did not bother to refute.  Approximately half of Plaintiffs’
pleading amounted to unnecessary general legal argument warranting a reduction in
the time it took to prepare that filing.  Approximately half of the “facts” Plaintiffs crafted
in Opposition to the summary judgment motion (i.e., Plaintiffs’ “Separate Statement of
Additional Material Facts”) were improper.  Perhaps most critically, well over 70% of
the billing entries fall into one or more of the following categories: prohibitively vague
“block billing,” excessive time spent on the stated task (including but not limited to
drafting the complaint and opposition to summary judgment motion and document
review tasks discussed above), double billing where two attorneys completed the
same task, attorney fees for non-attorney work, fees for filings that did not actually
occur in this case, and fees for otherwise unreasonable tasks.

In light of the foregoing and the other various reasons stated in Defendants’
Opposition, the Court in its discretion reduces Plaintiff’s requested “hours
worked” by 70%.  The Court reduces the “hours worked” element of the lodestar
calculation to a more reasonable total of 228.21 [760.7 – (760.7 x .70)].  Also, this
total more closely approximates defense counsel’s purported 224 hours worked, which
serves as a “cross-check” for the claimed hours.  (See Donahue v. Donahue (2010)
182 Cal.App.4th 259, 272 (“A comparative analysis of each side’s respective litigation
costs may be a useful check on the reasonableness of any fee request. The court can
look to how many lawyers the other side utilized in similar situations as an indication of
the effort required.”) (citation and quotation marks omitted).)  Accordingly, The Court
will use a total of 228.21 hours in the lodestar calculation.

Hourly Rates

It is Plaintiffs’ burden of showing that hourly rates of $450 and $350 are reasonable for
work of the same nature in Sacramento county.  (Nicols v. City of Taft (2007) 155
Cal.App.4th 1233, 1242-43 (“reasonable rate for comparable legal services in the local
community for litigation of the same type”); Graciano v. Robinson Ford Sales, Inc.
(2006) 144 Cal.App.4th 140, 156 (burden is on requesting party to prove hourly rate is
reasonable).)  Plaintiffs have not met their burden in this regard.

Plaintiffs appear to draw the requested rates from the Laffey Matrix (Pl.’s Ps & As at 7-
9), but Plaintiffs cite exclusively to federal cases involving rates drawn from that matrix
and never address whether or when California trial courts should apply that matrix.
Plaintiffs have not met their burden of showing that such matrix can serve as the
foundation for hourly fee rates in state court, let alone in a state court case like this
one.  Moreover, Plaintiffs have not properly put the Laffey Matrix before the Court; no
request for judicial notice thereof was filed, and while that Matrix is attached as Exhibit
F to Henderson’s declaration, Henderson never mentions Exhibit F or the Laffey Matrix
in the substance of her declaration.  The same is true with respect to the documents
attached as Exhibits G and H to Henderson’s Declaration.  Accordingly, the Court
declines to consider those documents as they do not amount to evidence properly
before the Court.

Relatedly, in their moving papers, Plaintiffs rely on a 2012 Daily Journal article
regarding average associate billing rates.  (Pl.’s Ps & As at 8-9; Exh. H to Henderson
Decl.)  Defendants’ objections (Def.’s Oppo. at 7 n.7) to Exhibit H of the Henderson
Declaration, are SUSTAINED.  Further, even if the Court were to consider Exhibit H as
“evidence” of billing rates, the Court is not persuaded that a Daily Journal article
regarding average rates would suffice to support the reasonableness of the fee rates
sought in this particular case, especially given that the analysis requires considerations
specific to Sacramento.

Plaintiffs offer the declaration of Richard Antognini to support their requested hourly
rates, and Antognini declares that he has “36 years” of experience and that he has
“been litigating foreclosure cases since 2006.  In my experience, $450 an hour is a
reasonable rate for attorneys with my level of experience in the Sacramento
area.”  (Declaration of Richard Antognini (“Antognini Decl.”) ¶ 4.)  Notwithstanding
Antognini’s experience and expertise, the Court is not persuaded that $450 an hour is
a reasonable rate in this particular case.  As Defendants note, Henderson has
practiced for 14 years (Henderson Decl. ¶¶ 7-8) yet she seeks Antognini’s purported
hourly rate of $450 — notwithstanding the fact that she has practiced for 22 years less
time than Antognini.  Further, none of Plaintiffs’ admissible evidence supports Nygren’s
requested first year associate rate of $350, even in light of Nygren’s background in
“real estate development, construction and finance” and Henderson’s assurance that
Nygren’s experience was “to the level of an expert in understanding the duties of the
bank, and all parties involved.”  (Henderson Decl. ¶ 20.)

Plaintiffs have not met their burden of showing that their requested hourly rates are
reasonable.  Plaintiffs also failed to timely file any Reply in support of their Motion,
such that they have not refuted Defendants’ arguments regarding billing rates.  (Defs.’
Oppo. at 18.)  Defense counsel’s own proffered billing rate of $260 is reasonable and
more closely comports with those in the local community, at least in the Court’s
experience.  Accordingly, given that the billing entries reveal many instances in which
both attorneys completed the same task, and for efficiency given Plaintiffs’ failure to
timely Reply to arguments against counsels’ claimed hourly rates, for purposes of the
lodestar calculation the Court will use a blended billing rate of $260 per hour.

Completing the lodestar calculation based on the foregoing, the Court awards
Plaintiffs’ counsel reasonable attorneys’ fees in the amount of $59,334.60 (228.21
hours worked x $260 per hour).   Multiplier

Plaintiffs have not met their burden of showing entitlement to any multiplier.  The trial
court should award a multiplier for exceptional representation only when the quality of
representation far exceeded the quality of representation that would have been
provided by an attorney of comparable skill and experience billing at the hourly rate
used in the lodestar calculation.  (Ketchum v. Moses (2001) 24 Cal 4th 1122.)  Among
the factors the court has considered in determining what multiplier to apply are the
novelty and difficulty of the issues involved, the skill displayed by plaintiff’s counsel in
overcoming the opposition of the defendant, the excellent results achieved by plaintiff,
and the importance of the rights that were vindicated by the results.  (Edgerton v. State
Personnel Bd. (2000) 83 Cal.App.4th 1350.)

Here, Plaintiffs’ one-paragraph “argument” contains no citations to authorities or
evidence bolstering the request for a multiplier, let alone a 4.0 multplier, and Plaintiffs’
moving papers do not identify what “complexity and new areas of law” were involved in
this mortgage case.  Plaintiffs’ counsel provides no justification or basis for a 4x
multiplier.  (See, e.g., Ramos v. Countrywide Home Loans, Inc. (2000) 82 Cal.App.4th
615, (2000) (2.5 multiplier an abuse of discretion).)  “Needless to say, the trial court
need not consider a multiplier when presented with an inflated, unreasonable fee
request.”  (Christian Research Institute v. Ahor (2008) 165 Cal.App.4th 1315, 1329.)
Accordingly, Plaintiffs’ request for a 4.0 multiplier is DENIED.

Defendants’ Opposition argues that a negative multiplier of 0.5 should be applied here,
given Plaintiffs’ counsels’ duplicative and excessive billing.  (Def.’s Oppo. at 16-17.)
However, because the Court reduced the compensable hours  worked and reduced
counsel’s hourly rate so as to reflect a reasonable loadstar, the Court is not persuaded
that it is necessary to apply a negative multiplier here.

Costs

Plaintiffs’ motion identifies 42 separate costs.  (Exh. E to Henderson Decl.)  However,
many of these “costs” are not recoverable under Code of Civil Procedure § 1033.5,
such as Cost Numbers 1-3, 5, 10-11,13-16, 20, 22, 23, 26, 28, 30, 34-35, 38, and 40-
41.  These “costs” include courier fees, consulting with other attorneys, cost of food,
photocopies of an Opposition, expert meetings, an “appearance fee,” credit
counseling, and the like.  (Id.)  The Court agrees with Defendants that the requested
costs should be reduced so as to include only proper and reasonable costs, and
accordingly, the Court reduces Plaintiffs’ requested cost amount of $9,791.06 by
$3,561.16, for a total costs award of $6,229.90.

Accordingly, for all the foregoing reasons, Plaintiffs’ motion is GRANTED IN PART and
DENIED IN PART in that the Court awards fees in the amount of $59,334.60, with no
multiplier, and costs in the amount of $6,229.90.

This minute order is effective immediately.  No formal order pursuant to CRC rule
3.1312 or other notice is required.