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Flame S.A. v. Industrial Carriers, Inc.

United States District Court, E.D. Virginia, Norfolk Division

December 16, 2014

FLAME S.A., Plaintiff, GLORY WEALTH SHIPPING PTE LTD., Consolidated, Plaintiff,
v.
INDUSTRIAL CARRIERS, INC., et al., Defendants

For FLAME S.A., Plaintiff: Steven Michael Stancliff, LEAD ATTORNEY, Crenshaw Ware & Martin PLC, Norfolk, VA; Lauren Brooke Wilgus William Robert Bennett, III, PRO HAC VICE, Blank Rome LLP (NY-NA), New York, NY.

For FREIGHT BULK PTE. LTD., Defendant: Patrick Michael Brogan, LEAD ATTORNEY, Davey & Brogan PC, Norfolk, VA; George Michael Chalos, PRO HAC VICE, Chalos & Co, P. C., Oyster Bay, NY.

For Glory Wealth Shipping Pte Ltd., Consolidated Plaintiff: Michelle Theresa Hess, LEAD ATTORNEY, Holland & Knight LLP, New York, NY.

MEMORANDUM OPINION AND ORDER

Lawrence R. Leonard, United States Magistrate Judge.

Before the Court now is the " Memorandum in Support of Consolidated Plaintiff Glory Wealth Shipping Pte Ltd.'s [" Glory Wealth" ] Motion for Award of Attorneys' Fees and Costs, " along with a supplemental declaration in support. ECF Nos. 589, 588. Glory Wealth's request for fees and costs is premised on this Court's previous Orders authorizing such relief. Specifically, upon granting in part Glory Wealth's Motion to Compel, ECF No. 173, (" Motion to Compel"), the Court found that Defendant Freight Bulk Pte, Ltd.'s (" FBP") position was not substantially justified, and other circumstances did not make an award of reasonable expenses unjust; therefore, it granted Glory Wealth's request for attorneys' fees and costs in one of two discovery orders issued on April 30, 2014. ECF No. 209 (" Discovery Order"). Later, Glory Wealth filed a Motion for Sanctions, ECF No. 323, based on FBP's violation of the Court's Discovery Order. In granting the motion, the Court again awarded Glory Wealth its attorneys' fees and costs. ECF No. 377 (" Sanctions Order"). Glory Wealth subsequently filed a single motion seeking its attorneys' fees for both the Motion to Compel and the Motion for Sanctions. ECF No. 468. That motion was denied without prejudice based on Glory Wealth's failure to provide sufficient evidence of the reasonableness of the fees it sought, and Glory Wealth was given fourteen days to submit additional evidence to remedy the deficiencies in its fee request. ECF No. 572. Glory Wealth has now done so, ECF Nos. 588 and 589, FBP has responded, ECF No. 600, and Glory Wealth has replied, ECF No. 602. Accordingly, the matter is now ripe for disposition.

I. PROCEDURAL HISTORY

Having previously discussed the relevant procedural history and the basis for the Court's finding that FBP should pay Glory Wealth's attorneys' fees and costs in the Court's Discovery Order, ECF No. 209, its Sanctions Order, ECF No. 377, and its Order denying without prejudice Glory Wealth's first request for attorneys' fees, ECF No. 572, the Court will not repeat said details here. Rather, only a summary is necessary to establish the context for the present request for attorneys' fees.

With respect to the Motion to Compel, in relevant part Glory Wealth sought to compel FBP to fully respond to its First Request for Production of Documents (" RFP"), and to produce Viktor Baransky for a deposition. In granting the motion in part, the Court ordered FBP to produce documents in response to RFP numbers 1-33, 35-70, 72-75, 77, 87, 95-129, 131-132, 135, 138-144, 146-147, 149-160, 163, 167-169. ECF No. 209 at 5. The Court also ordered FBP to produce Mr. Baransky for deposition. Id. at 6-7. In denying the motion in part, the Court held that FBP was not required to produce documents in response to RFP numbers 71, 78-86, 88-94, 130, 133-134, 136-137, 145, 148, 161-162, 164-166, 170. Id. at 5. FBP was also directed to respond to request number 34 and 76 as limited by the Court. Id. Finding that Glory Wealth had made a good faith effort to resolve the discovery dispute without the intervention of the Court, that FBP's position was not substantially justified, and that circumstances did not otherwise make an award of expenses unjust, the Court granted Glory Wealth's request for attorneys' fees pursuant to Federal Rule of Civil Procedure (" Rule") 37(a)(5)(A). ECF No. 209 at 8-9. However, as the Court acknowledged in its Order granting Plaintiff Flame S.A.'s, (" Flame"), first motion for attorneys' fees, it should have referenced Rule 37(a)(5)(C), since Glory Wealth's motion was granted in part and denied in part. See ECF No. 498 at 4-5. While Rule 37(a)(5)(A) provides that the Court must award reasonable expenses if the motion is granted (absent the exceptions delineated in subparts (i-iii)), Rule 37(a)(5)(C) provides that the Court may apportion the reasonable expenses for the motion if it is granted in part and denied in part (absent the same exceptions). Compare Rule 37(a)(5)(A), with Rule 37(a)(5)(C). Accordingly, the Court will appropriately apply Rule 37(a)(5)(C)'s direction to apportion the reasonable expenses for the Motion to Compel. See, e.g., Mitchell v. Nat 7 R.R. Passenger Corp., 217 F.R.D. 53, 60 (D.D.C. 2003) (finding an apportioned award was appropriate when the movant prevailed on six out of seven discovery issues).

With respect to the Motion for Sanctions, Glory Wealth claimed that FBP failed to comply with the Discovery Order and cited six categories of requested discovery that FBP had not produced in violation of the Discovery Order:

1. Corporate Records. ECF Nos. 324 at 7-9;
2. Emails Sent or Received by Victor Baransky. Id. at 9-10;
3. Supporting Documentation for Bank Records. Id. at 10-11;
4. Attachment to the Loan Agreement Between Sea Traffic Shipping Co. and FBP. Id. at 11-12;
5. Charters for the M/V CAPE VIEWER and HARMONY FALCON. Id. at 12-13; and
6. Documents from Industrial Carriers Inc. (" ICI"). Id. at 13.

Glory Wealth consequently sought sanctions for FBP's violations, including attorneys' fees and costs it incurred because of FBP's failure to obey the Court's Discovery Order. In its Sanction Order, the Court found that FBP did not violate the Court's Discovery Order in connection with its production of the supporting documentation for bank records, and the charter parties for the CAPE VIEWER and HARMONY FALCON, but that FBP did violate the Court's Discovery Order by failing to produce documents pertaining to ICI, including corporate records, and the attachment to the loan agreement between Sea Traffic and FBP evidencing the loan repayment terms. ECF No. 377 at 19. In addition, the Court found that FBP violated the Discovery Order by failing to produce, in a timely fashion, Viktor Baransky's emails and the attachments thereto. Id. Evaluating FBP's conduct under Rule 37(b)(2)(A) and the standards enunciated in Anderson v. Found, for Advancement, Educ. & Emp't of Am. Indians, 155 F.3d 500, 504 (4th Cir. 1998), the Court found that such conduct warranted the imposition of sanctions, including reasonable expenses incurred as a result of FBP's failure to obey the Court's Discovery Order. Id. at 19-24. Based on FBP's counsel's role in advising the disobedient party, the Court awarded Glory Wealth its reasonable expenses against both FBP and its attorneys. Id. at 24 n.12.

In support of its request for reasonable expenses, Glory Wealth now relies on a memorandum in support, ECF No. 589, the supplemental declaration of its attorney, Mr. James H. Power, along with attached billing records, ECF No. 588, and the declaration of Mr. Robert W. McFarland, a Norfolk attorney not involved in this litigation but who proffered the declaration in support of Flame's second motion for attorneys' fees, ECF No. 429 attach. 3. FBP opposed Glory Wealth's request on the grounds that it was not properly supported, that the time entries were not identified as to which motion they should be attributed to, that one time entry for July 7, 2014 is not related to either the Motion to Compel or the Motion for Sanctions, and that one third of Glory Wealth's brief in support of its Motion for Sanctions dealt with Glory Wealth's request that the Court reconsider its Order delineating the parameters of discovery, which the Court has denied. ECF No. 600.

II. ANALYSIS

As the Court has stated on numerous occasions, it evaluates the reasonableness of attorneys' fees by comparing the requested amount to the lodestar amount, which is defined as a " reasonable hourly rate multiplied by hours reasonably expended." Grissom v. The Mills Corp., 549 F.3d 313, 320-21 (4th Cir. 2008). In determining what constitutes a reasonable number of hours and rate, the Court looks to the factors[1] enumerated in Robinson v. Equifax Info. Servs., LLC, 560 F.3d 235, 243-44 (4th Cir. 2009). Specifically in connection with an award of attorneys' fees awarded pursuant to Rule 37, the Court looks to (1) Factor 1: the time and labor expended; (2) Factor 2: the novelty and difficulty of the questions raised; (3) Factor 3: the skill required to properly perform the legal services rendered; (4) Factor 5: the customary fee for like work; (5) Factor 9: the experience, reputation and ability of the attorney; and (6) Factor 12: attorneys' fees awards in similar cases. Id; Sun Trust Bank v. Nik, No. 1:11cv343, 2012 WL 1344390, at *3 (E.D. Va. Mar. 22, 2012). The burden is on the party requesting fees to establish their reasonableness. Plyler v. Evatt, 902 F.2d 273, 277 (4th Cir. 1990); Cook v. Andrews, 7 F.Supp.2d 733, 736 (E.D. Va. 1998). Finally, it is within the sound discretion of the Court to fix the amount of a reasonable fee. Hensley v. Eckerhart, 461 U.S. 424, 437, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983).

Glory Wealth's Motion requests an award of reasonable expenses both with respect to the Motion to Compel, for which fees were awarded pursuant to Rule 37(a), and the Motion for Sanctions, for which fees were awarded pursuant to Rule 37(b). Because of the differences in each rule, the Court will address the standards to be applied first.

A. Standards for Determining Attorneys' Fees

1. Rule 37(a)(5)(C) Standard

Having granted in part and denied in part Glory Wealth's Motion to Compel and awarded it the right to recover reasonable attorneys' fees and costs, the Court turns first to the standards it must apply under Rule 37(a)(5)(C). As many district courts have noted, the same factors guide a court's decision under both subsection 37(a)(5)(A) and 37(a)(5)(C). See, e.g., Stephenson v. Pfizer Inc., No. 1:13CV147, 2014 WL 3385213, at *2 (M.D. N.C. July 9, 2014) (citing Switch Communs. Grp. LLC v. Ballard, No. 2:1 l-CV-285, 2011 WL 5041231, at *1 (D. Nev. Oct. 24, 2011)). '" Rule 37(a)(5)(C) effectively incorporates the substantive standards of Rule 37(a)(5)(A)... that expenses of a discovery motion may be imposed upon a party ordered to produce discovery where that party's conduct necessitated the motion' unless the nondisclosure or objection was substantially justified or other circumstances make an award of expenses unjust." Charter Practices Int'l, LLC v. Robb, No. 3:12CV1768, 2014 WL 273855, at *5 (D. Conn. Jan. 23, 2014) (quoting Rahman v. Smith & Wollensky Rest. Grp., No. 06 CIV. 6198, 2009 WL 2169762, at *2 n.l (S.D.N.Y. July 21, 2009)).

In addition, reasonable expenses may not be awarded if the movant filed the motion before attempting in good faith to obtain the discovery without court intervention. Rule 37(a)(5)(A)(i). Following the April 9, 2014 hearing held by the Court on Plaintiff Flame's first and second motions to compel and FBP's motion for protective order, the Court ordered all parties, including Glory Wealth, to immediately meet and confer over pending discovery matters. ECF Nos. 148, 147 at 22-25. Glory Wealth's Motion to Compel followed that meet-and-confer, and ...


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