3:15-cv-02136 | M.D. Penn. | Mar 16, 2016

Case 3:15-cv-02136-RPC Document 28 Filed 03/16/16 Page 1 of 9

IN THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF PENNSYLVANIA Scott Romeo Plaintiff v. (Case No. 3:15-CV-2136)

Simm Associates, Inc. (Judge Richard P. Conaboy) Defendants. Memorandum We cons here a Motion r Attorneys' Fees filed by counsel to Plaintiff Scott Romeo. Mr. Romeo was awarded $1,001.00 in statutory damages pursuant to the r Debt Collection Practices

ct, 15 U.S.C. § 1692 et seq. (The "FDCPA"). Mr. Romeo's award, which reflect no actual damages, was pa by Defendant Simm Associates incident to an Offer of Judgment negotiated for Mr. Romeo by his counsel, Carlo Sabatini.

Attorney Sabatini init lly sought an award of fees and costs in the amount of $14,121.05. (DoC. 18, ~ 3). The motion was supported by various exhibits including correspondence between

ttorney Sabatini and defense counsel and numerous affidavits supporting the time Attorney Sabatini had expended in this case and the reasonableness of his hourly rate. Defense counsel opposed this motion and filed a Br f (Doc. 23) detailing its reasons for asserting its position that the fee request was unreasonably

1 Case 3:15-cv-02136-RPC Document 28 Filed 03/16/16 Page 2 of 9 inflated. Attorney Sabatini filed a Reply Brief (Doc. 26) to respond to the arguments raised by defense counsel. Attorney Sabatini seeks an additional $5,000.00 in recognition of the legal

ork performed in crafting his reply br f. Thus, the total fees and costs sought by Attorney Sabatini now amount to $19,121.05. (Doc. 26 at 32).

Defense counsel's objections to the amount requested by ttorney Sabatini include: (1) that Attorney Sabat's hourly rate is unjustified; (2) that an award of attorneys' fees is not required this case; and (3) that all fees for time extended after Defendant's November 10, 2015 Offer of Judgment are uncompensable. We shall consider these arguments in turn. I. Whether Attorney Sabatini's Hourly Rate is Excessive and,

Hence, Unjustified? contends that Attorney Sabatini's increase De his

hourly rate from $350.00 to $375.00 per hour and commensurate increases of his associate's hourly rates e ctive January 1, 2016 are unjustifiable. Defendant contends that because its attorneys billed their time at $315.00 per hour in this case that the Court is thus bound to limit Plaintiff's counsel's hourly rate to that charge by defense counsel under the rationale expressed in Diaz v. Saucon Valley Manor, 2013 WL 6409450, (E.D.pa. 2013). The Court

ust observe that, having read Diaz carefully, Diaz does not stand for the proposition defense counsel advances. In Diaz, the Court 2 Case 3:15-cv-02136-RPC Document 28 Filed 03/16/16 Page 3 of 9 specifically found that attorneys' fees are based on "prevai i the arket rates" rather lling rates of opposing counsel.' , s z is actually more supportive of Att Sabat Thus, position than that of de nse counsel.

With respect to the quest whether Attorney Sabatini's fees are consistent prevail market rates, Court is hardly sed at attorney's fees calculated at $375.00 per hour for an attorney with 16 years experience who s ializes consumer protection law. See Sabati Affidavit (Doc. 18-5, ~ 6-13). Indeed, the Sabatini Affidavit has been corroborated by support

ffidavits from six other attorneys who affirm that the hour rate charged by Attorney Sabat i and those charges by his associates are consistent with prevailing market rates for attorneys with similar experience and expertise in this market Middle and of Pennsylvania). See Va Eastern Distr i v. Allstate 2 nd Insurance Company, 243 F.Supp. • 200, 207 (M.D. Pa. 2003).

ccordingly, this Court finds that Attorney Sabat i's billing rate and those of his associates are consistent with the prevailing arket rates the relevant legal community and, thus, will be approved. II. Whether an Award of Attorneys' Fees is Required in this Case?

This case arises under the Fa Debt Collection Practices Act. Case 3:15-cv-02136-RPC Document 28 Filed 03/16/16 Page 4 of 9 Congress stated that the Act's purpose was: ... to eliminate abusive debt collection practices by debt collectors, to ensure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses.

15 U.S.C. § 1699(e). There can be no doubt that Defendant committed one of the abusive practices proscribed by the Act inasmuch as Defendant has so acknowledged by his Offer of Judgment. [2]

The clear weight of author y holds that "[A]ttorneys' fees should not be construed as a special or discretionary remedy; r, the Act mandates an award of attorneys' s as a means of fulfilling Congress's intent that the Act should be en by debtors acting as private attorneys general. Indeed, several courts have required an award of attorneys' s even where

iolations were so minimal that statutory damages were not Case 3:15-cv-02136-RPC Document 28 Filed 03/16/16 Page 5 of 9 '. tations omitted) (Graziano v. Harrison, 950 F. 2d warranted." 107, 113 (3d. Cir. 1991). Despite these authorities, Defendant argues that in extraordinary circumstances, such as where s "bad faith" conduct, attorneys' fees Plaintiff's counsel exh ( Doc. 23 at 8). Defendant intimates that, need not be awarded. because Plaintiff's counsel did not accept its initial Offer of stead demanded "hyper-technical changes" to that Judgment and document, Plaintiff's counsel was exhibiting a type of faith" r his own benefit" and "unreasonably conduct by "churning fees prolonged the litigat " (Id. at 9).

Defendant has not, however, provided the Court with any explication as to what "hyper-te cal s" to s first Offer iff's attorney. Thus, the Court of Judgement were sought by P sis to conclude that Plaintiff's counsel was "churning

s no this file".3 Also, with respect to the al ion Plaintiff's attorney "unreasonably prolonged the litigation", the Court must observe that Plaintiff's attorney offered to settle this case $3,850.00 by letter of October 8, 2015. ( Doc. 18 - 2 ) . Defendant a "take it or leave it" offer of $2,800.00 on responded (Doc. 18 - 4) . s, Defendant's December 22, 2015. ision to lit te the appropriateness of the fees sought by Plaintiff's counsel is at least partially, if not primarily, respons Ie for

'. Case 3:15-cv-02136-RPC Document 28 Filed 03/16/16 Page 6 of 9 the prolonging of this litigation. Defendant cannot now be heard to complain that Plaintiff's attorney's fees are greatly increased since its decision to litigate has made necessary Plaintiff's counsel's participation In a mediation before Magistrate Judge Saporito on January 11, 2016; his filing of a Motion for Attorneys' Fees and Supporting Brief (Docs. 18 and 19); and his development of a Reply Brief (Doc. 26) to respond to arguments raised in Defense Counsel's Brief in opposition to Motion for Attorneys' Fees (Doc. 23). These activities by Plaintiff's counsel were necessary steps to perfect his fee application and inevitably increased the amount owed him for vindicating his client's rights here. That the fees sought here are disproportionate to the amount of th~ client's recovery is of no relevance. "The whole purpose of fee-shifting statutes [such as the FDCPA] is to generate attorneys' fees that are

ortionate to the Plaintiff's recovery." (emphasis In original) Millea v. Metro-N.R.Co., 658 F.3d 154, 169 (2d. Cir. 2011). This availability of a lodestar fee [4] ensures that "claims of modest cash value can attract competent counsel." Millea, supra, at 169. The Court concludes that Defendant has provided no basis to conclude that this case is one characterized by an extraordinary situation where no fee should be awarded.

Case 3:15-cv-02136-RPC Document 28 Filed 03/16/16 Page 7 of 9 III. Whether All Fees for Time Expended After November 10, 2015 are Unreasonable, Excessive, and Uncompensable? asserts that all time expended by PIa iff's De

counsel after Defendant made its first Offer of Judgement in this atter on November 10, 2015 was unreasonable, excessive, and uncompensable. (Doc. 23 at 9-10). Defendant cites Rode v. Dellarciprete, 892 F.2d 1177, 1183 (3d. Cir. 1990), for the general proposition that the Court should examine whether Plaintiff's

ounsel has spent an inordinate amount of time on this case as compared to other attorneys litigating similar files. This is undeniably so and the Court intends to do that.

More specifically, Defendant cites Baker Botts, LLP et al v. sarco LLC, 135 S.Ct. 2158, 2165 (2015) for the proposition that, in the context of a bankruptcy case, "reasonable compensation for services is confined to disinterested service in the client's erest. This is both true and irrelevant. This is not a bankruptcy case and the Court finds that the principle articulated in Baker Botts, supra, is confined to cases decided under the Bankruptcy Code. Moreover, to do as Defendant suggests would place intiff's attorneys in FDCPA cases in a situation

here their fees would be limited to the value of services rendered such time as some arb rary "Offer of Judgement" is made hich may, or may not, fully account for both the statutory damages owed to litigant and the reasonable va of the attorney's 7 Case 3:15-cv-02136-RPC Document 28 Filed 03/16/16 Page 8 of 9 services. This would frustrate the will of Congress that reasonable attorney's fees be available to ensure that competent counsel are willing to champion the cause of debtors who are not owed large sums under the Act. See Graziano and Ilea, supra. Thus, while Defendant may certainly litigate question of the iff's counsel's legal se ces in an FDCPA fair value of PI case, Defendant cannot reasonably expect that t and energy expended by Plaintiff's counsel in vindicat h right to a uncompensated. , Defendant's brief reasonable fee would I raised issues to which Plaintiff's counsel ly responded in

s reply brief, a document that required considerable research and si ficantly the amount of the s intiff's counsel seeks.

with respect to the reasonableness of s sought here by Plaintiff's counsel, Court has already (page 3 ante) that iff's counsel and the rates charged by s employees are unremarkable in the relevant legal commun The Court now finds expended by Pia that the amount of t iff's counsel's firm

rating their client's recovery and cat their right to s case is consistent the fees sought in the cases Plaintiff's counsel has c ed (see Doc. 26 at 28-30), proportionate to the tenacity with which Defendant 1 this matter, and

easonable under the circumstances. 8 ..

Case 3:15-cv-02136-RPC Document 28 Filed 03/16/16 Page 9 of 9

IV. Conclusion. For the reasons stated above, Plaintiff's counsel's Motion for ttorney's Fees and Costs (Doc. 18), as ampl ified by additional time expended in the formulation of his Reply Brief (Doc. 26), will be granted. An Order consistent with this determination will be filed contemporaneously.

BY THE COURT

Dated: ________ ~ __ ~_(_~ __ ~_I_b _______

FILED

SCRANTO

MAR 1 G 2016

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,-:lER

~z:::

DEPUTY CLERK

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NOTES

[1] While Diaz was a case concerning the fees owed to a Plaintiffs attorney in a case involving the Family Medical Leave Act, the principle espoused in Diaz applies equally to FDCPA cases. 3

[2] Also, the same abusive practice that Defendant employed in this case has been found to iolate the Act (see Styer v. Professional Medical Mgt., Inc., 114 Supp. 3d. 234, 241-43 (M.D. Pa. 015)), and, indeed, runs contrary to "a core concern animating the FDCPA, the invasion of rivaey." Douglass v. Convergent Outsourcing, 765 F.3d, 299, 303 (3d. Cir. 2014). 4

[3] It should also be noted that Plaintiffs counsel has provided a perfectly plausible reason why earlier renditions of Defendant's Offer of Judgment were unacceptable. (Doc. 26 at 3-5). 5

[4] The "lodestar" is "the product of reasonable hours times a reasonable rate". Pennsylvania v. Delaware Valley Citizens' Counsel for Clean Air, 478 U.S. 546, 565 (1986). 6