1 292~ JUN f O PH ~: 3t..
2 ~ 3 BY·------------
5 IN THE SUPERIOR COURT OF GUAM 6
7 HEE K. CHO and MIN S. CHO, CIVIL CASE NO. CV 1059-17
8 Plaintiffs,
9 V. DECISION AND ORDER ' IO ALUPANG BEACH CLUB, INC. and Re: Defendants' Motion for Award ofAttorneys ' STEVEN KASPERBAUER, Fees and Expenses 11 Defendants. 12
13 This matter came before the Honorable Arthur R. Barcinas on March 12, 2024, for a 14 hearing on Defendants Alupang Beach Club, Inc. and Steven Kasperbauer's (collectively, 15 "Defendants") Motion for Award of Attorney's Fees and Expenses ("Motion for Fees"), filed on 16 June 23, 2023. Plaintiffs Hee K. Cho and Min S. Cho (collectively, "Plaintiffs") were 17 represented by Attorney William Mann. Defendants were represented by Attorney Mitchell 18 Thompson, with Defendant Kasperbauer present. After reviewing the pleadings and oral 19 arguments, for the reasons set forth below, the Court hereby GRANTS in part the Motion for 20 Fees. 21 BACKGROUND 22 This matter arises from a Complaint filed by Plaintiffs on October 9, 2017. On August 2, 23 2018, the Court issued a Decision and Order denying Defendants' first Motion for Summary 24 Decision and Order Hee K. Cho and Min S. Cho v. Alupang Beach Club, Inc. and Steven Kasperbauer, Civil Case No. CV1059-l 7
1 Judgment Based on Anti-SLAPP Statute, on the grounds that the differences between the
2 Replacement Horizontal Property Regime ("HPR") and the Amended HPR were not sufficiently
3 material to sustain a claim for CPGA relief. On August 7, 2018, the Defendants appealed the
4 Court's Decision and Order and filed a Notice of Appeal with the Supreme Court of Guam.
5 On May 28, 2020, the Supreme Court of Guam issued an Order affirming the trial
6 court's decision that summary judgment under the CPGA was not appropriate because the scope
7 and applicability of the parties' Settlement Agreement and Mutual Release ("SAMR") to the
8 Amended HPR was unclear, and that the parties should therefore have the opportunity to flesh
9 out those issues on the merits. Cho v. ABC, Inc. 2020 Guam 10 ,i 17.
10 On March Ei, 2022, Defendants> filed the Second Mbtion for Summary ~udgment
11 ("Second MSJ"), sans all claims pursuant to the CPGA. Defendants argued that: (1) Plaintiffs
12 lack standing to seek restitution of the settlement consideration because they did not pay the
13 consideration in the first place; (2) even if the Court finds Plaintiffs have standing, courts are
14 unwilling to find waiver of the right to petition in circumstances which fall short of being clear
15 and compelling; and (3) ABC did not "clearly, compelling and unambiguously" waive its right
16 to participate in all GLUC proceedings in perpetuity.
17 On May 16, 2023, the Court granted summary judgment in favor of Defendants, finding
18 that the Court lacked subject-matter jurisdiction because Plaintiffs had demonstrated no injury-
19 in-fact regarding their claim for monetary damages and therefore had no standing on that issue.
20 On June 9, 2023, the Court entered its Judgment dismissing the case with prejudice.
21 On June 23, 2023, Defendants filed the Motion for Fees, arguing for reasonable fees on
22 the grounds that section 5.6 of the SAMR contains an express provision for the award of
23 attorneys' fees to the prevailing party in the event of any dispute concerning the terms of the
24 Page 2 ofll Decision and Order Hee K. Cho and Min S. Cho v. Alupang Beach Club, Inc. and Steven Kasperbauer, Civil Case No. CVI 059-17
1 SAMR or any of the settlement documents executed by the parties thereto. Defendants
2 requested an attorneys' fee award of $97,577.50, as well as an additional sum of $7,345.04 for
3 computer research expenses and $1,810.50 for other litigation expenses. On February 23, 2024,
4 Plaintiffs filed their opposition to the Motion for Fees, arguing that a court without subject-
5 matter jurisdiction doe_s not have authority to consider a defendant's attorneys' fees motion; and
6 that if the Court maintains that it has subject-matter jurisdiction, the requested fees and expenses
7 should be reduced to reflect Defendants' lack of success on their allegedly unrelated anti-
8 SLAPP Motion before the Court and the Supreme Court. On February 26, 2024, Defendants
9 filed their reply, arguing that the Court had not granted summary judgment on Plaintiffs' claim
10 for injutlctive relief; that the d'ourt's dismissal i~ based on prudential ~tanding, not constitutionaf
11 standing, and is therefore not jurisdictional; that Defendants' defenses were not unrelated to the
12 anti-SLAPP Motion; that where there is a contractual attorneys' fee provision, Guam law should
13 take precedence over federal law in awarding fees; and that ABC is entitled to additional fees
14 incurred since its initial motion.
15 On March 12, 2024, the Court heard arguments from both parties and took the matter
16 under advisement.
17 DISCUSSION
18 Guam follows the American rule for attorney's fees in civil cases. Fleming v. Quigley,
19 2003 Guam 4 ,r 13. The American rule dictates that each party generally bears its own expenses
20 of litigation, including attorney's fees. Id. ,r 7. However, Guam recognizes the exception that
21 attorney's fees are allowed where they are provided for by statute, contract, or under equitable
22 circumstances. Mobil Oil Guam, Inc. v. Tendido, 2004 Guam 7 ff 43-49 (upholding a
23 contractual provision providing that attorney's fees were recoverable in the case of one party
24 Page3 ofll Decision and Order Hee K. Cho and Min S. Cho v. Alupang Beach Club, Inc. and Steven Kasperbauer, Civil Case No. CV1059-17
1 having to enforce the contract); Quigley, 2003 Guam 4 ,r 20. Contractual provisions providing
2 for the allowance of attorney's fees to the winning party are construed to include fees incurred
3 both at the trial level and on appeal. Tendido, 2004 Guam 7 ,r 49. Absent specific statutory or
4 contractual language to the contrary, the term "costs" does not include attorney's fees. Sule v.
5 Guam Bd. ofDental Examiners, 2008 Guam 20 ,r 53. Generally, a court abuses its discretion ifit
6 awards contractually-authorized attorney's fees under circumstances that make the award
7 inequitable or unreasonable, or fails to award such fees in a situation where inequity will not
8 result. Rahmani v. Park, 2011 Guam 7 if 63.
9 The Guam Supreme Court has held that, where there is a contractual provision for
m attorney's fe~s, a.:court is not reqmred tb rely on a statutory ptovision for atto~ey's fees. Fargo 11 Paci.fie, Inc. v. Korando Corp., 2006 Guam 22 ,r 51. Section 5.6 of the SAMR explicitly states
12 that "[i]n the event that any dispute arises concerning the terms of [the SAMR] or any of the
13 Settlement Documents executed by the parties, the prevailing party shall be entitled to recover
14 attorneys' fees from the non-prevailing party." Generally, for the purpose of determining
15 entitlement to attorney's fees, the prevailing party to a suit is the one who successfully
16 prosecutes the action or successfully defends against it, prevailing on the merits of the main
17 issue. Rahmani, 2011 Guam 7 ,r 61. Accordingly, the Court finds that, barring the below issues,
18 Defendants would ordinarily be entitled to recover attorney's fees and costs.
19 1. The Court's dismissal of the damages claim did not divest the Court ofsubiect-matter
20 iurisdiction over this case.
21 The primary issue before the Court is whether the Court has subject matter jurisdiction
22 to award attorney's fees where an underlying issue has been dismissed for lack of subject matter
23 jurisdiction. "If a plaintiff fails to establish standing, a court has no jurisdiction to hear the
24 Page4 ofll Decision and Order Hee K. Cho and Min S. Cho v. Alupang Beach Club, Inc. and Steven Kasperbauer, Civil Case No. CV1059-l 7
1 case." Fernandez v. 23676-23726 Malibu Road, LLC, 74 F.4 th 1061, 1064 (9th Cir. 2023). The
2 Ninth Circuit holds that a court that lacks jurisdiction at the outset of a case lacks the authority
3 to award attorneys' fees, but an exception to the rule exists "where the statute under which a
4 party seeks attorney's fees contains an independent grant of jurisdiction." Id.
5 Plaintiffs argue that the Court, having dismissed their monetary damages claim for lack
6 of standing, no longer has subject-matter jurisdiction to award attorney's fees and must
7 therefore dismiss the Defendants' Motion for Fees. Plaintiffs first cite to the Guam Supreme
8 Court's decision in DFS Guam L.P. v. A.B. Won Pat Int'! Airport Auth., 2014 Guam 12, arguing
9 that the Supreme Court held that "[w]ithout jurisdiction the court cannot proceed at all in any
10 ~ause .. Jurisdiction is the power to declare the law, and when it ceases to exist, the only function
11 remaining to the court is that of announcing the fact and dismissing the cause." Plaintiffs further
12 cite to Willow Farms, LLCv. AWCC WCW Holdings, LLC, 2016 WL 4150749 (D. Or. 2016), in
13 which the Oregon federal court held that where a district court lacks jurisdiction over the
14 underlying suit, it has no authority to award attorneys' fees. Id. at *1.
15 The Court finds that it is not necessary to determine whether it has subject-matter
16 jurisdiction to award attorney's fees, because the Court is not divested of its subject-matter
17 jurisdiction over this case as a whole. While the Court may have dismissed Plaintiffs' monetary
18 damages claim - what Plaintiffs referred to as their "secondary claim" - for lack of standing, it
19 did not dismiss Plaintiffs' primary injunctive relief claim on that basis because Plaintiffs had
20 effectively abandoned that claim by not properly addressing it in their opposition. Indeed,
21 Plaintiffs continued to argue that their injunctive relief claim was active until the Court issued
22 its January 23, 2024 Decision and Order denying Plaintiffs' Motion to Amend or Vacate
23 Judgment. Because the Court did not rule in either its May 16, 2023 decision or its January 23,
24 Page5 ofll Decision and Order Hee K. Cho and Min S. Cho v. Alupang Beach Club, Inc. and Steven Kasperbauer, Civil Case No. CV1059-17
1 2024 decision that the injunctive relief claim lacked standing, the Court finds that it maintains
2 subject-matter jurisdiction over the injunctive relief claim, even if only to determine whether
3 said claim was still active.
4 Because the Court is not divested of subject-matter jurisdiction over this matter, the
5 Court finds that it has jurisdiction to consider Defendants' Motion for Fees. The Court further
6 finds that Defendants successfully defended themselves against Plaintiffs' action, and prevailed
7 on the merits of the main issue, that issue being, by Plaintiffs' own statement, the injunctive
8 relief claim.
9 Accordingly, based on the parties' pleadings and arguments, the Court GRANTS the
10 Defendants' Motion for Fees.
11 2. Constitutional standing is a prerequisite to pursuing reliefin all cases.
12 Injunctive relief claim notwithstanding, Defendants also argue that the Court's finding
13 of lack of standing in its May 16, 2023 decision was more consistent with the concerns that
14 make up prudential standing, not constitutional standing, and that therefore Plaintiffs' reliance
15 on constitutional standing issues and jurisdiction is not pertinent. The Court does not agree.
16 In In re A.B. Won Pat Int'/ Airport Auth., Guam, 2019 Guam 6, the Guam Supreme Court
17 formally adopted the doctrine of prudential standing as established in Lexmark Int 'l, Inc. V.
18 Static Control Components, Inc., 572 U.S. 118 (2014). The Supreme Court distinguished
19 prudential standing from constitutional standing and held that, under Lexmark, "considerations
20 traditionally understood under the rubric of prudential standing are not jurisdictional in nature."
21 However, the Supreme Court also held in that case that "[ c]onstitutional standing is a
22 necessary prerequisite to pursuing relief in all cases filed in the courts of Guam, and the
23 legislature cannot remove the requirement of constitutional standing by statute." DFS, 2019
24 Page 6 ofll Decision and Order Hee K Cho and Min S. Cho v. Alupang Beach Club, Inc. and Steven Kasperbauer, Civil Case No. CV1059-l 7
1 Guam 6 ,r 18 (emphasis original). Further, the Supreme Court only explored the applicability of
2 prudential standing in that case after already determining that constitutional standing existed.
3 While the Supreme Court may have distinguished prudential standing from constitutional
4 standing, it did not establish that prudential standing may be used as a replacement for
5 constitutional standing; merely that the doctrine of prudential standing allows a court to "refuse
6 to adjudicate some claims even where the constitutional standing requirements had been
7 satisfied." Id. ,r 26. Therefore, Defendant's argument that the Court should consider prudential
8 standing as the standard for the damages claim rather than constitutional standing is
9 procedurally impossible.
IO I. Determination oYAttorney's Fees Amdunt
11 In the Motion for Fees, Defendants request that the Court award Defendant ABC an
12 attorneys' fee award of $97,577.50, which allegedly represents 385.85 hours of professional
13 services, at the hourly rate of $250 before January 2023, and $300 beginning January 2023.
14 Defendants further request that the Court award an additional sum of $7,345.04 for the
15 computer research expenses reasonably incurred in this case, as well as $1,810.50 for other
16 litigation expenses.
17 A. Whether attorney's fees should include the unsuccessful anti-SLAPP appeal
18 Plaintiffs claim that Defendants' requested attorneys' fees must be reduced to reflect
19 their lack of success on their anti-SLAPP claim, arguing that "work on an unsuccessful claim
20 cannot be deemed to have been expended in pursuit of the ultimate result achieved." Opp., at 4
21 (quoting Hensley v. Eckerhart, 461 U.S. 424, at 434-435 (1983). Plaintiffs state that, out of
22 Defendants' $97,577.50 in claimed attorneys' fees, $65,792.50 of that amount was spend on
23 Defendant's unsuccessful anti-SLAPP Motion. Plaintiffs further state that the Hensley finding
24 Page7 ofll Decision and Order Hee K. Cho and Min S. Cho v. Alupang Beach Club, Inc. and Steven Kasperbauer, Civil Case No. CV1059-l 7
1 was applied to Schwarz v. Secretary of Health & Human Servs., 73 F.3d 895 (9th Cir. 1995),
2 which they argue bears similar circumstances to the instant case. In Schwarz, the plaintiff
3 prevailed on only one of five claims, with the remainder eliminated by summary judgment, and
4 the Ninth Circuit held that "[w]e may award fees for work done on a successful appeal of a
5 district court's award, but not for an unsuccessful one." 73 F.3d at 909.
6 Following Hensley, the Schwarz court stated that "[t]he most useful starting point for
7 determining the amount of a reasonable fee is the number of hours reasonably expended on the
8 litigation multiplied by a reasonable hourly rate." Id, at 901 (quoting Hensley, 461 U.S. at ~33).
9 But a court has discretion to make a downward adjustment to the components or the product of
10 this initiaPequation, known' as tbe lodestar, for the results obtained i~ the' litigation. Id. The
11 results of the litigation are a crucial factor where a plaintiff is deemed to prevail, even if they
12 only succeed on some of their claims for relief. Id. "Where the plaintiff succeeds on only some
13 of their claims," the court must determine whether the successful and unsuccessful claims are
14 "distinctly different claims for relief that are based on different facts and legal theories" or
15 whether they "involve a common core of facts or are based on related legal theories." Id. If the
16 claims are distinctly different, the hours spent on the unsuccessful claim should be excluded in
17 considering the amount of a reasonable fee, because "work on such an unsuccessful claim
18 cannot be deemed to have been expended in pursuit of the ultimate result achieved." Id.
19 (quoting Hensley, 461 U.S. at 435). However, if the claims are related, the trial court "should
20 focus on the significance of the overall relief obtained by the plaintiff in relation to the hours
21 reasonably expended on the litigation," and "a plaintiff who has won substantial relief should
22 not have their attorney's fee reduced simply because the [trial] court did not adopt each
23 contention raised." Id. (quoting Hensley, 461 U.S. at 440). "If the plaintiff obtained excellent
24 Page8 ofll Decision and Order Hee K. Cho and Min S. Cho v. Alupang Beach Club, Inc. and Steven Kasperbauer, Civil Case No. CV I 059-17
1 results, full compensation may be appropriate, but if only partial or limited success was
2 obtained, full compensation may be excessive. Such decisions are within the [trial] court's
3 discretion." Id. (quotation omitted).
4 Relying on the test established by Hensley and Schwarz, the Court finds that
5 Defendants' unsuccessful claims and successful claim bear a common core of facts and are
6 therefore related under the Hensley test. The Ninth Circuit has held that a commonality of both
7 facts and law are not required to conclude that unsuccessful and successful claims are related;
8 the Court merely needs to find one or the other. Webb v. Sloan, 330 F .3d 1158, 1168 (9th Cir.
9 2003). Schwarz also dictates that the focus in the commonality test is "to be on whether the
10 ·.unsuccessful and subcessful claims a;ose Jcmt of the same Zcoufse of conduct."' 'Because both
11 claims arise from the same course of conduct and the same Complaint filed by Plaintiffs, a
12 sufficient commonality of facts exists to find that the anti-SLAPP claim is related to
13 Defendants' instant claims. Further, as stated above, contractual provisions providing for the
14 allowance of attorneys' fees to the winning party are construed to include fees incurred both at
15 the trial level and on appeal. Tendido, 2004 Guam 7,r 49.
16 However, when determining whether an unsuccessful claim is compensable, the relation
17 of the unsuccessful claims to the successful claims is only the first part of the analysis. 0 'Neal
18 v. City of Seattle, 66 F.3d 1064, 1068-69 (9 th Cir. 1995). "If the unsuccessful and successful
19 claims are related, then the court must apply the second part of the analysis, in which the court
20 evaluates the significance of the overall relief obtained by the [party] in relation to the hours
21 reasonably expended. If the [party] obtained excellent results, full compensation may be
22 appropriate, but if only partial or limited success was obtained, full compensation may be
24 Page9 ofll Decision and Order Hee K Cho and Min S. Cho v. Alupang Beach Club, Inc. and Steven Kasperbauer, Civil Case No. CVI 059-17
1 excessive." Id. Because the case was completely dismissed in Defendants' favor, the Court finds
2 that Defendants' counsel achieved excellent results and are entitled to full compensation.
3 A. Whether the fees are reasonable
4 The Guam Supreme Court has agreed that, in determining a reasonable hourly rate,
5 courts look to the prevailing rate in the community. Matter of Guardianship of Moylan, 2022
6 Guam 10 ,r 46 (quoting SP0106-07. The Guam Supreme Court has found a $300 hourly rate
7 reasonable, and agreed that a $300 hourly rate has been reasonable since at least 2015 by
8 affirming the trial court's citation to Gange v. Gov't of Guam, CVI461-10, Decision and Order
9 at 19 (July 22, 2015), which approved a $300 hourly rate, and Palmer v. Mariana Stones Corp.,
10 C\'0709.,.13, Decision an'd Order (Dec. 17, 2o'i8)/ which approved hourly rates between '$200
11 and $400. In determining the reasonableness of attorney's fees, fidelity to the exact amount
12 billed is not required. Moylan, 2022 Guam 10 ,r 43. The Court should seek to determine a
13 "reasonable" award, not an award that mirrors any amount billed to Defendants. Id. ,r 43. The
14 Guam Supreme Court in Moylan agreed that, even where the record supported a billable rate of
15 $250.00, a trial court's order granting attorney's fees at a $300 hourly rate was not erroneous.
16 Id. ,r 41. Even where the parties in Moylan disagreed as to how the Court derived the exact
17 amount of attorney's fees, the Supreme Court found that immaterial so long as it did not appear
18 that the trial court ordered an unreasonable amount given the facts and circumstances of the
19 case. Id. ,r 44.
20 Upon review of Defendants' supporting documentation in the Declaration of R. Todd
21 Thompson, filed June 23, 2023, the Court finds that Defendants' requested fees of $97,577.50
22 are not unreasonable for a case spanning more than six years, nor are the $1,810.50 in related
23 legal expenses. Accordingly, the Court will GRANT the Motion for Fees in part as it applies to
24 Page 10 ofll Decision and Order Hee K. Cho and Min S. Cho v. Alupang Beach Club, Inc. and Steven Kasperbauer, Civil Case No. CVI 059-17
1 these two amounts. However, the -Court will not award the $7,345.04 requested for computer
2 research expenses, as the Ninth Circuit has held that "[n]either tradition nor statutory usage
3 distinguishes computer-based legal research costs from attorney's fees," and reasonable charges
4 for computer-based legal research may only be recovered as attorney's fees if separate billing
5 for such expenses is the prevailing practice in the local community. Trustees of Const. Industry
6 and Laborers Health and Welfare Trust v. Red/and Ins. Co., 460 F.3d 1253 (9th Cir. 2006)
7 (citing Missouri v. Jenkins by Agyei, 491 U.S. 274, 287 (1989)). Upon the Court's review, such
8 separate billing is not the prevailing practice in the local legal community, as research charges
9 are typically already accounted for in an attornets hourly rate, and Defendants have not
10 dem~nstrated that this is the prevailing practice: Therefore, the Court wifl. DENY in part the 1 ,
11 Motion for Fees insofar as Defendants' computer research expenses, and the Court will hereby
12 AWARD Defendants the total amount of $99,388.00.
13 CONCLUSION
14 Based on the foregoing, the Court hereby GRANTS in part and DENIES in pa
15 Defendant's Motion for Attorney's Fees, and AWARDS Defendants the total amount o
16 $99,388.00.
17 IT IS SO ORDERED this day of _ _JU_N_1_0_2_02_4_ _
19 t 20 HONORABLE ARTHUR R. BARCINAS 21 Judge, Superior Court of Guam
24 Page 11 ofll