Daryoush Javaheri v. Deutsche Mellon National Asset, LLC

• Court: District Court, C.D. California
• Decided: January 9, 2020
• Docket: 2:18-cv-06615
• Status: Unknown

Opinion

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7 United States District Court 8 Central District of California 9 10 11 DARYOUSH JAVAHERI, Case №. 2:18-cv-06615-ODW(FFM) 12 Plaintiff, ORDER GRANTING 13 v. DEFENDANT’S MOTION FOR 14 DEUTSCHE MELLON NATIONAL ATTORNEYS’ FEES [29] 15 ASSET, LLC et al., 16 Defendants. 17 18 I. INTRODUCTION 19 On April 8, 2019, the Court granted a motion to dismiss filed by defendant U.S. 20 Bank Trust, N.A., as Trustee for LSF9 Master Protection Trust (“Defendant”) and 21 entered judgment on April 15, 2019 against plaintiff Daryoush Javaheri (“Plaintiff”). 22 Defendant now moves for attorneys’ fees in the amount of $13,846. For the reasons 23 discussed below, the Court GRANTS IN PART and DENIES IN PART Defendant’s 24 Motion for Attorneys’ Fees (“Motion”). (Mot., ECF No. 29). 25 II. FACTUAL AND PROCEDURAL BACKGROUND 26 The Court has recited the facts of this case extensively in its Order Granting 27 Defendant’s Motion to Dismiss with Prejudice (“Order”) and incorporates that 28 discussion here by reference. (See Order, ECF No. 25.) 1 Briefly, Plaintiff borrowed $2,660,000 secured by a Deed of Trust against 2 property located at 10809 Wellworth, Los Angeles CA (the “Property”). (See Def.’s 3 Req. for Judicial Notice (“RJN”) in Support of Mot. to Dismiss, ECF No. 11.) After 4 Plaintiff defaulted on the loan, the Property was sold at public auction on May 31, 5 2016 with Defendant becoming the owner, and on June 9, 2016, a Trustee’s Deed 6 Upon Sale was recorded against the Property evidencing the foreclosure sale. (Id.) 7 Following a lengthy procedural history and multiple judgments recounted in this 8 Court’s April 8, 2019 Order, Plaintiff again sued Defendant on June 14, 2018, 9 asserting the following claims: (1) wrongful foreclosure; (2) to set aside trustee’s sale; 10 (3) to void or cancel trustee’s deed upon sale; (4) to void or cancel assignment of deed 11 of trust; (5) quiet title; and (6) relief for eviction and related relief. (See generally 12 Compl., ECF No. 1-1.) 13 On April 8, 2019, the Court dismissed Plaintiff’s claims with prejudice based 14 on Defendant’s successful invocation of res judicata. (See Order.) The Court entered 15 judgment on April 15, 2019, and Defendant timely filed the Motion on April 22, 2019 16 seeking attorneys’ fees under the promissory note (“Note”).1 (J., ECF No. 28; Mot.) 17 On May 13, 2019, The Court deemed adjudication of the Motion appropriate without 18 oral argument and therefore vacated the May 20, 2019 hearing. (ECF No. 30.) 19 Plaintiff then filed an untimely opposition (“Opposition”) on May 17, 2019. (See 20 Opp’n, ECF No. 31.) 21 III. LEGAL STANDARD 22 A. Motion for Attorneys’ Fees Pursuant to Contract. 23 “Under California law, a prevailing party is ordinarily not entitled to attorneys' 24 fees unless the parties have previously agreed to shift fees or the fees are otherwise 25 provided by statute.” In re Bennett, 298 F.3d 1059, 1070 (9th Cir. 2002) (citations 26

27 1 The Court previously took judicial notice of the Note—attached to Defendant’s Request for Judicial Notice in Support of Motion to Dismiss—and again considers the Note in conjunction with 28 the instant Motion. 1 omitted). “California Civil Code § 1717(a) provides for the awarding of attorney's 2 fees in the case of a contract.” Orange v. Wachovia Bank, N.A., No. EDCV 12-01683 3 VAP, 2013 WL 7869377, at *1 (C.D. Cal. Sept. 23, 2013). Section 1717(a) states: 4 In any action on a contract, where the contract specifically provides that 5 attorney's fees and costs, which are incurred to enforce that contract, shall be awarded either to one of the parties or to the prevailing party, then the 6 party who is determined to be the party prevailing on the contract, 7 whether he or she is the party specified in the contract or not shall be entitled to reasonable attorney's fees in addition to other costs. 8 9 Cal. Civ. Code § 1717(a); see also Cal. Civ. Proc. Code §§ 1021, 1033.5(a). 10 A party seeking recovery of attorneys’ fees under Section 1717(a) must show 11 that: (1) a contract authorizes such fees; (2) the moving party is the prevailing party; 12 and (3) the fees incurred are reasonable. Johnston v. Lindauer, No. 2:07-CV-01280, 13 2010 WL 2850767, at *4 (E.D. Cal. July 20, 2010) (citing First Nat. Ins. Co. of Am. v. 14 MBA Const., No. 02:04–CV–836 GEB–JFM, 2005 WL 3406336, at *2 (E.D. Cal. 15 Dec. 12, 2005). Moreover, “to recover fees incurred in connection with litigation of a 16 claim under a fee shifting contract, a party must show that the claim fell within the 17 scope of the contract…” Boza v. US Bank Nat’l Ass’n, No. 12-cv-06993JAKFMOX, 18 2013 WL 12136517, at *3 (C.D. Cal. July 25, 2013), aff’d sub nom. Boza v. U.S. Bank 19 NA (Two Cases), 606 F. App’x 357 (9th Cir. 2015) (quoting Baldain v. Am. Home 20 Mortg. Servicing, Inc., No. CIV.S-09-0931LKK/GGH, 2010 WL 2606666, at *5 (E.D. 21 Cal. June 28, 2010). 22 IV. DISCUSSION 23 A. Whether Fees May Be Awarded 24 Defendant argues that it is contractually entitled to recover attorneys’ fees under 25 California Civil Code § 1717(a) pursuant to Section 7(e) of the Note, which provides: 26 If the Note Holder has required me to pay immediately in full as described above, the Note Holder will have the right to be paid back by 27 me for all of its costs and expenses in enforcing this Note… Those 28 expenses include, for example, reasonable attorneys’ fees. 1 2 (See Request for Judicial Notice, at Exhibit A, § 7(e).) 3 First, Defendant correctly states that it is the prevailing party in this case, as the 4 Court granted Defendant’s Motion to Dismiss with Prejudice (See Order.) and entered 5 judgment in favor of Defendant. (See J.) 6 Second, Defendant is correct that Section 7(e) of the Note constitutes a valid 7 fee-shifting provision and that Plaintiff’s dismissed claims fell within the scope of 8 Section 7(e). In re Baroff, 105 F.3d 439, 442–43 (9th Cir. 1997) (“California courts 9 liberally construe ‘on a contract’ to extend to any action as long as an action involves 10 a contract and one of the parties would be entitled to recover attorney fees under the 11 contract if that party prevails in its lawsuit....”) (quoting Milman v. Shukhat, 22 Cal. 12 App. 4th 538, 544–45 (1994)) (additional internal quotations omitted). Indeed, 13 Defendant prevailed on every claim against it and California courts make clear that 14 those claims constituted an action “on the contract” because they challenged the 15 validity of Plaintiff’s mortgage obligation and Defendant’s right to foreclose in 16 connection with Plaintiff’s mortgage. See, e.g., Ng v. U.S. Bank, NA, No. 15-cv- 17 04998-KAW, 2016 WL 6995884, at *4 (N.D. Cal. Nov. 30, 2016) (“Plaintiff’s claims 18 directly challenged Defendants’ ability to enforce the note and deed of trust, both by 19 claiming that Defendants did not have the authority to enforce the documents and by 20 seeking to rescind the documents entirely.”); Bonner v. Redwood Mortg. Corp., No. 21 10-cv-00479-WHA, 2010 WL 2528962, at *3 (N.D. Cal. June 18, 2010) (awarding 22 fees on fraudulent misrepresentation, unjust enrichment, conspiracy, quiet title, § 23 17200, usury, predatory lending, privacy and emotional distress claims “[g]iven their 24 significant relation to the parties’ mortgage contract.”); Rivera v. Wachovia Bank, 25 2009 WL 3423743, at *2 (S.D. Cal. 2009) (mortgage case awarding fees on claims for 26 declaratory relief, fraud, breach of covenant, breach of contract, quiet title, unfair 27 business practices and conspiracy because they were all “either based directly on the 28 contract, require predicate acts based on the contract, or relate to the formation of the 1 contract”). 2 Plaintiff does not dispute Defendant’s grounds for recovery of attorneys’ fees 3 nor can he contest this voluminous California authority awarding contract-based 4 attorneys’ fees in analogous mortgage cases. Instead, Plaintiff’s untimely Opposition 5 purports to challenge Defendant’s Motion for Attorneys’ Fees by arguing that the 6 Court improperly granted Defendant’s motion to dismiss based on res judicata and by 7 again arguing the merits of Plaintiff’s already-dismissed underlying claims. (See 8 generally Opp’n.) But Plaintiff’s untimely Opposition provides no procedural or 9 substantive bases for this Court to reconsider its dismissal, let alone does it challenge 10 the well-grounded merits of the Motion now before the Court. (Id.) 11 The Court therefore finds that Defendant is entitled to an award of attorneys’ 12 fees and turns to the amount of the award. 13 B. Amount of Attorneys’ Fees 14 An award of attorneys’ fees must be reasonable. “The reasonableness of a party's 15 fee calculation is determined by the ‘lodestar method’” accomplished by multiplying 16 the number of hours reasonably expended on the litigation by a reasonable hourly rate. 17 Morales v. San Rafael, 96 F.3d 359, 363 (9th Cir. 1996), amended on denial of reh’g, 18 108 F.3d 981 (9th Cir. 1997). This method includes consideration of the 12–factor 19 test set forth in Kerr v. Screen Extras Guild, Inc., 526 F.2d 67 (9th Cir. 1975), 20 abrogated on other grounds by City of Burlington v. Dague, 505 U.S. 557 (1992); 21 Tutor-Saliba Corp. v. City of Hailey, 452 F.3d 1055, 1064–65 (9th Cir. 2006). 22 The Kerr factors assist the Court to determine whether the lodestar figure is 23 reasonable and if it should be adjusted. Kerr, 526 F.2d at 70. The factors are: 24 (1) the time and labor required, (2) the novelty and difficulty of the 25 questions involved, (3) the skill requisite to perform the legal service properly, (4) the preclusion of other employment by the attorney due to 26 acceptance of the case, (5) the customary fee, (6) whether the fee is fixed 27 or contingent, (7) time limitations imposed by the client or the circumstances, (8) the amount involved and the results obtained, (9) the 28 experience, reputation, and ability of the attorneys, (10) the 1 ‘undesirability’ of the case, (11) the nature and length of the professional 2 relationship with the client, and (12) awards in similar cases. 3 4 Id. These factors are “intended to provide district courts with guidance” when 5 adjusting the lodestar and “were never intended to be exhaustive or exclusive.” 6 Chalmers v. City of Los Angeles, 796 F.2d 1205, 1211 (9th Cir. 1986). Courts “need 7 not consider all twelve factors, but only those called into question by the case at hand 8 and necessary to support the reasonableness of the fee award.” Kessler v. Assocs. Fin. 9 Servs. Co. of Haw., 639 F.2d 498, 500 n.1 (9th Cir. 1981). 10 1. Reasonable Hourly Rate 11 Defendant seeks a range of $450 to $490 per hour for attorney Aaron Goldstein; 12 $535 per hour for attorney Kristine Kruger; $310 per hour for an individual named 13 Kenneth Ragsak; and $215 per hour for an individual named Sean Campos. (See ECF 14 No. 29-2 at Ex. A.) To determine whether hourly rates are reasonable, courts consider 15 whether the “requested rates are in line with those prevailing in the community for 16 similar services by lawyers of reasonably comparable skill, experience, and 17 reputation.” Trs. of S. Cal. IBEW–NECA Pension Plan v. Electro Dynamic Servs., CV 18 07–05691-MMM-PLAx, 2008 WL 11338230, at *5 (C.D. Cal. Oct. 14, 2008) (citing 19 Blum v. Stenson, 465 U.S. 886, 895–96 n.11 (1984)). The relevant community is the 20 district in which the adjudicating court sits. Camacho v. Bridgeport Fin., Inc., 523 21 F.3d 973, 979 (9th Cir. 2008). The party seeking attorneys’ fees may satisfy its burden 22 of showing that the proposed hourly rate is reasonable by submitting affidavits of 23 counsel, affidavits of other counsel in the relevant community, and by providing case 24 law examples of the relevant community rate. See id. at 980–81. 25 Defendant submits a declaration from its counsel of record, Aaron Goldstein, 26 detailing his experience of over 13 years and attaching a billing statement itemizing 27 hours worked on this case by himself and others employed by his firm. (Goldstein 28 Decl., ECF No. 29-2.) “Once the fee applicant has proffered such evidence, the 1 opposing party must produce its own affidavits or other evidence to rebut the 2 proposed rate.” Cortes v. Metro Life Ins. Co., 380 F. Supp. 2d 1125, 1129 (C.D. Cal. 3 2005) (citing United Steelworkers of Am. v. Phelps Dodge Corp., 896 F.2d 403, 407 4 (9th Cir. 1990)). 5 Plaintiff did not oppose Defendant’s proposed hourly rates. (See generally 6 Opp’n.) Accordingly, the Court must rely solely on Mr. Goldstein’s declaration in 7 support of the Motion. As such, the Court accepts the proposed hourly rate of $450 for 8 Mr. Goldstein as reasonable because he has sufficiently attested to his experience over 9 the past 13 years and Plaintiff offers no rebuttal. (Goldstein Decl.) However, 10 Defendant provides no evidence regarding the experience—or even the roles—of the 11 remaining individuals whose work is detailed in the billing statement. (Id.) With no 12 evidence regarding the reasonableness of these professionals’ hourly rates, this Court 13 cannot evaluate Defendant’s request for an award as to these individuals’ fees. 14 Defendant also fails to offer evidence supporting the necessity of Mr. Goldstein’s 15 inexplicable hourly rate increase from $450 to $490 during the pendency of this case. 16 Hence, the Court finds an hourly rate of $450 for Mr. Goldstein to be reasonable but is 17 constrained by Defendant’s lack of affirmative evidence and therefore must reject 18 Defendant’s request for a fee award for Mr. Goldstein’s colleagues and an hourly rate 19 exceeding $450 for Mr. Goldstein. 20 2. Number of Hours Reasonably Expended 21 “A district court has wide latitude in determining the number of hours that were 22 reasonably expended by the prevailing lawyers.” Sorenson v. Mink, 239 F.3d 1140, 23 1146 (9th Cir. 2001). “The fee applicant bears the burden of documenting the 24 appropriate hours expended in litigation and must submit evidence in support of those 25 hours worked.” Gates v. Deukmejian, 987 F.2d 1392, 1398 (9th Cir. 1992). 26 Here, Defendant’s billing statement shows that Mr. Goldstein spent 16.7 hours 27 from July 12, 2018 to April 8, 2019 and his declaration states that he spent an 28 additional 3.5 hours preparing Defendant’s Motion for Attorneys’ Fees, totaling 20.2 1 | hours work and $9,090 in fees incurred for Mr. Goldstein’s work in connection with 2 || this case when calculated at an hourly rate of $450. (See Goldstein Decl. at 75, Ex. 3 || A.) Defendant’s detailed billing statement substantiates this time and Mr. Goldstein 4] declares that every .1-hour increment in said billing statement “was reasonable and 5 || necessary to the successful defense of this action.” (See id. § 4.) Plaintiff does not 6 || dispute the number of hours spent or meaningfully respond to Defendant’s Motion. 7 || (See generally Opp’n.) 8 Considering Plaintiffs failure to oppose, Defendant’s meticulous 9 | recordkeeping, and the lengthy history of this case warranting the hours invested by 10 | Mr. Goldstein, the Court finds that Defendant has satisfied its burden in demonstrating 11 || the reasonableness of the work performed by Mr. Goldstein. In its discretion, the 12 | Court reduces this amount by 10% and awards Defendant $8,181. Moreno v. City of 13 || Sacramento, 534 F.3d 1106, 1112 (9th Cir. 2008) (“The district court can impose a small reduction, no greater than 10 percent—a ‘haircut’—based on its exercise of 15 || discretion and without a more specific explanation.”’) 16 V. CONCLUSION 17 For the reasons discussed above, the Court GRANTS IN PART and DENIES 18 | IN PART Defendant’s Motion for Attorneys’ Fees and AWARDS $8181 to 19 | Defendant. (ECF No. 29.) 20 IT IS SO ORDERED. 21 22 January 9, 2020 DE. AY

4 OTIS D. HT, Il 05 UNITED STATES DISTRICT JUDGE

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