Bavelis v. Doukas (In re Bavelis)

535 B.R. 228
CourtUnited States Bankruptcy Court, S.D. Ohio
DecidedJuly 31, 2015
DocketCase No. 10-58583; Adv. Pro. No. 10-2508
StatusPublished
Cited by3 cases

This text of 535 B.R. 228 (Bavelis v. Doukas (In re Bavelis)) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, S.D. Ohio primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bavelis v. Doukas (In re Bavelis), 535 B.R. 228 (Ohio 2015).

Opinion

MEMORANDUM OPINION AND ORDER AWARDING GEORGE A. BA-VELIS ATTORNEYS’ FEES AND EXPENSES INCURRED AS A RESULT OF TED DOUKAS’S CIVIL CONTEMPT

John E. Hoffman, Jr., United State Bankruptcy Judge

I.Introduction

After the Court held Ted Doukas (“Dou-kas”) in civil contempt, the Chapter 11 debtor, George A. Bavelis (“Bavelis”), requested an award of the reasonable attorneys’ fees and expenses he incurred as a result of Doukas’s contemptuous conduct. For the reasons explained below, the Court awards Bavelis fees and expenses in the amount of $62,411.56 and orders Dou-kas to pay that amount to Bavelis immediately.

II.Jurisdiction and Constitutional Authority

The Court has jurisdiction to hear and determine this contested matter pursuant to 28 U.S.C. §§ 157 and 1334' and the general order of reference entered in this district. This is a core proceeding. See 28 U.S.C. § 157(b)(2)(A) and (0).

The Court also has the constitutional authority to enter a final order awarding professional fees and expenses incurred as a result of contemptuous conduct. See In re Brown, 511 B.R. 843, 848 (Bankr.S.D.Tex.2014) (holding that bankruptcy courts have the constitutional authority to impose sanctions for contempt after Stern v. Marshall, — U.S. -, 131 S.Ct. 2594, 180 L.Ed.2d 475 (2011)); In re Green, No. 12-13410, 2014 WL 1089843, at *1 (Bankr.N.D.Ohio Mar. 19, 2014) (same); Schermerhorn v. Centurytel, Inc. (In re Skyport Global Commc’ns), No. 08-36737-H4-11, 2013 WL 4046397, at *41 (Bankr.S.D.Tex. Aug. 7, 2013) (same).

III.Procedural Background

Following an evidentiary hearing (the “Contempt Hearing”), the Court entered an opinion and order holding Doukas in civil contempt. See Bavelis v. Doukas (In re Bavelis), 519 B.R. 707 (Bankr.S.D.Ohio 2014) (the “Contempt Opinion”). The Court also established procedures for determining the amount of attorneys’ fees and expenses that Bavelis incurred and may recover as a result of the contempt. See id. at 722-23. In accordance with those procedures, Bavelis filed a statement in which he requested fees and expenses incurred as a result of Doukas’s contempt (the “Fee Request”) (Adv.Doc. 523).1 [232]*232Through an attorney whose motion for admission pro hac vice the Court later denied, see Adv. Doc. 541, Doukas filed an objection to the Fee Request (the “Doukas Objection”) (Adv.Doc. 539).

On March 18, 2015, Doukas, who was then appearing pro se, represented to the Court that he would be available for a hearing on the Fee Request and the Dou-kas Objection on May 4, 2015, and the Court entered an order scheduling the hearing for that date. Adv. Doc. 591. But later, on March 23, 2015, Doukas, claiming to be unable to travel to Columbus for a hearing on May 4, 2015, sent a letter to the Court requesting that the hearing be rescheduled. Adv. Doc. 623 (letter redacted to preserve confidentiality). As a result, the Court entered an order rescheduling the hearing for June 22, 2015 — a date on which Doukas represented in his letter that he would be available. Adv. Doc. 599. On April 20, 2015, Franklin Davis (“Davis”) entered a notice of appearance on behalf of Doukas.2 Adv. Doc. 603.

On June 22, 2015, the Court held the hearing on the Fee Request (the “Fee Hearing”). Despite the fact that the hearing had been rescheduled so that Doukas could attend it personally, he failed to do so. Instead, he appeared only through Davis and another attorney from Davis’s firm. Thus, even if Doukas truly was unavailable on the date originally scheduled for the Fee Hearing, the reason he gave for why he needed the hearing to be rescheduled appears to have been spurious.

During the Fee Hearing, the Court heard the testimony of Richard Stovall (“Stovall”), Christopher Hogan (“Hogan”) and Larry McClatchey (“McClatchey”), all on behalf of Bavelis. Stovall testified in support of the fees charged by Bavelis’s bankruptcy counsel, Allen Kuehnle Stovall & Neuman LLP (“AKSN”), while Hogan testified in support of the fees and expenses charged by Bavelis’s special litigation counsel, Zeiger, Tigges & Little LLP (“ZTL”). McClatchey provided expert testimony in support of both. In addition, Bavelis Exhibits 5 through 9 were admitted into evidence without objection. Invoices reflecting the time spent by Bavel-is’s professionals in connection with this matter (the “Invoices”) were admitted into evidence as Bavelis Exhibits 5(ZTL) and 6 (AKSN), while Bavelis Exhibits 7 and 8 provided summaries of the Invoices, and Bavelis Exhibit 9 set forth a “Timeline of Billing Matters Related to Doukas’ Contempt” (the “Timeline”).

Doukas presented no evidence during the Fee Hearing.

IV. Findings of Fact

In this opinion, the Court uses the defined terms contained in the Contempt Opinion and incorporates its findings of fact by reference. Among other things, the Court found in the Contempt Opinion that Doukas violated the Court’s Injunction and therefore was in civil contempt when he failed to provide Bavelis unfettered access to certain documents in the books and records of GMAQ (the Assignment of Mortgage) and FLOVEST (the Quit Claim Deeds). See Contempt Op., 519 B.R. at 715-16. In addition, the Court found that Doukas engaged in contemptuous conduct when he purported to transfer property of GMAQ, a limited liability company in which Bavelis asserted an interest, to one of Doukas’s own companies, Leftheris. The GMAQ property that Doukás purported to transfer included a Foreclo[233]*233sure Judgment exceeding $2.3 million, the right to bid at the foreclosure sale and the successful bid. See id. at 716-17. Based on the evidence adduced during the Fee Hearing and the Contempt Hearing, including the documentary evidence and the testimony presented, the Court makes the following additional findings of fact.

A. Total Fees and Expenses Requested

After the Fee Request was filed, Hogan discovered that ZTL had mistakenly included in the Invoices two time entries relating to matters other than Doukas’s contempt, Hearing Transcript (“Tr.”) (Adv. Doc. 621) at 14-17, requiring the amount of fees and expenses requested for the time periods' covered by the Invoices to be reduced from $51,466.06 to $50,131.56.3 Tr. at 18. In addition to the $50,131.56 amount, Bavelis seeks to recover $3,600 for the time his counsel spent preparing for the Fee Hearing up through June 9, 2015, Tr. at 5, 18-19; an additional $2,280 for time counsel spent preparing for the hearing after June 9, 2015, Tr. at 19; and $6,400 in expenses for McClatchey’s expert witness fees. Tr. at 36-37. Thus, the total amount of fees and expenses Bavelis seeks to recover as a result of Doukas’s contempt is $62,411.56.

B. Fees

Bavelis may recover the fees set forth in the Invoices to the extent that (1) the hourly rates of the professionals who represented him in this matter are reasonable and (2) the time spent was both reasonable and expended as a result of Doukas’s contempt.

1. Hourly Rates

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535 B.R. 228, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bavelis-v-doukas-in-re-bavelis-ohsb-2015.