469 B.R. 44
Bankr. D.N.M.2012Background
- Market Center sought to sue Lowe’s for breach and related claims after Lowe’s pulled from a purchase agreement for the Shopping Center.
- Barak Lurie agreed to represent Market Center under a blended fee arrangement: $200/hour plus a 15% contingency on sums recovered 90 days or earlier before trial.
- Market Center filed for Chapter 11; the bankruptcy court later allowed Lurie’s employment and later filed a fee application.
- Lurie’s fee request totaled over $1.47 million, including a 15% contingency on a sale-price–driven increase and hourly fees.
- Bankruptcy court awarded $350,752.06 after considering the estate’s benefit, time, rates, and other §330 factors, and Market Center appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether §330 requires only lodestar calculation | Lurie: §330 allows non-lodestar consideration | Market Center: §330 confines to hours × rate | No; nonlodestar factors permissible under §330(a)(3) |
| Whether Perdue limits §330 to lodestar analysis | Perdue not controlling for bankruptcy fee awards | Perdue requires lodestar in civil cases only | Perdue does not control; §330 allows broader discretion |
| Whether a contingent/hybrid fee arrangement can be considered under §330 | Hybrid terms may be considered; not prohibited | Contingent element conflicts with §330 structure | Court may consider hybrid arrangements in determining reasonable fee under §330 |
| Whether award was an impermissible enhancement | Fee award reflects the value of extraordinary results | Enhancement concerns | Not an impermissible enhancement; supported by substantial results |
Key Cases Cited
- In re Commercial Fin. Servs., Inc., 427 F.3d 804 (10th Cir. 2005) (broad discretion in §330 fee awards; nonexclusive factors)
- Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir. 1974) (lodestar factors inform reasonable rate and time; Johnson framework cited)
- Venegas v. Mitchell, 495 U.S. 82 (1990) (§1988 awards; context of reasonableness inquiry and third-party concerns)
- Perdue v. Kenny A. ex rel. Winn, 130 S. Ct. 1662 (2010) (limits of enhancements; distinctions between §1988 and bankruptcy fees)
- In re Duffin, 457 B.R. 820 (10th Cir. BAP 2011) (reaffirmed broad discretion in §330 reasonable fee determinations)
- In re Wind N’ Wave, 509 F.3d 938 (9th Cir. 2007) (authority for supplemental fee awards under §503(b)(4))