Dees v. US Collections West Incorporated

• Court: District Court, D. Arizona
• Decided: December 29, 2020
• Docket: 2:19-cv-05895
• Status: Unknown

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA

9 David Dees, No. CV-19-05895-PHX-SMB

10 Plaintiff, ORDER

11 v.

12 US Collections West Incorporated,

13 Defendant. 14 15 Pending before the Court is Plaintiff, David Dees, Motion for Attorney’s Fees, (Doc. 16 20), and responsive pleadings. (Docs. 21-22.) Pursuant to LRCiv. 7.2(f) the Court elects to 17 rule on this matter without oral argument. The Court grants Plaintiff’s request for attorneys’ 18 fees in the amount of $4,847.50, finding the remaining portion of the hours claimed were 19 not “reasonably expended” on the litigation. 20 I. Background 21 On December 26, 2019, Plaintiff, David Dees (“Dees”), filed this action against 22 Defendant, U.S. Collections West, Inc. (West), alleging violations of the Fair Debt 23 Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692 et seq. On March 23, 2020, in 24 response to the parties’ mutual stipulation, the Court entered an order granting Plaintiff 25 statutory damages of $1,000.00 and costs of $450.00 and ordering the parties to submit 26 briefing on the issue of attorneys’ fees. (Doc. 19.) Plaintiff submitted this Motion for 27 Attorney’s Fees on March 30, 2020 claiming fees in the amount of $7,243.50 for the time 28 spent resolving the underlying case. (Doc. 20.) Plaintiff also asserted his right to an 1 additional $2,205.00 in fees for time spent preparing his original motion for fees and his 2 reply to Defendant’s response to that motion. (Doc. 20 at 5; Doc. 22 at 10.) Defendant has 3 responded arguing the number of hours spent by Plaintiff in litigating the case were 4 unreasonable because Plaintiff rejected settlement offers that matched the maximum 5 amount of his statutory damages and continued to push for more damages and other 6 remedies not provided under FDCPA. (Doc. 21.) 7 While this case was filed on December 26, 2019, the parties’ settlement discussions 8 predate the formal filing by several months, a fact the Plaintiff’s request for fees rightly 9 reflects. (Doc. 20.) On August 27, 2019 Plaintiff’s counsel sent a draft complaint and notice 10 letter to the Defendant. (Doc. 20-2 at 6.) Shortly after receiving the documents, Defendant’s 11 president, Donald Darnell (Mr. Darnell) attempted to contact Plaintiff’s counsel and seek 12 a quick resolution “as Defendant was not disputing liability.” (Doc. 21 at 2.) Plaintiff 13 responded with an offer to settle the case for $5,250.00 if defendant agreed to remove the 14 trade lines it had reported on Plaintiff’s credit score. (Doc. 22 at 2.) On September 4, 2019, 15 Defendant responded with a settlement offer of $1,000 matching Plaintiff’s maximum 16 statutory damages. (Id.) Plaintiff responded the next day with an offer to settle the case for 17 $4,750.00 plus tradeline deletion. (Id.) Defendant responded requesting a calculation for 18 the basis of the demand and notified Plaintiff’s counsel that Plaintiff currently had a 19 remaining outstanding debt to the Defendant of more than $5,000.00. (Doc. 22-4 at 3.) 20 Defendant then informed the Plaintiff’s counsel it would offer to settle for $2,000.00 21 without any trade deletion and informed him if the offer wasn’t accepted then Plaintiff 22 could file suit and they would offer a settlement of the judgement $3,500.00 and sue 23 Plaintiff separately to recover his outstanding debt. (22-5 at 2.) 24 Additional settlement communications were exchanged between the parties, but 25 they remained at an impasse. This was due to Defendant’s refusal “remove [the trade line] 26 from his credit report unless there is a legal reason why1,” (Doc. 22-10 at 2), combined

27 1Plaintiff has since admitted that requiring trade line deletion is not a remedy available 28 under the FDCPA. (Doc. 22 at 2.) However, Plaintiff asserts it is a “common feature in FDCPA settlements. 1 with Plaintiff’s minimum offer of $4,250.00 to settle the case. As noted above, the Plaintiff 2 eventually filed suit on December 26, 2019. (Doc. 1.) Defendant filed an answer with the 3 Court on February 12, 2020. (Doc. 12.) On that same day, Defendant sent Plaintiff’s 4 counsel a copy of an answer admitting its liability and an offer of judgement for $3,500.00. 5 (Doc. 21 at 3.) However, Plaintiff refused this offer and on March 5, 2020 filed a motion 6 for Judgement on the Pleadings. (Doc. 13.) Several days later, on March 10, Plaintiff 7 informed the Defendant that his new settlement demand was $7,500.00 plus deletion of the 8 alleged debt from the Plaintiff’s credit report. (Doc. 21 at 3.) Throughout these settlement 9 negotiations, Defendant at various times requested Plaintiff to explain the basis by which 10 he calculated the settlement value of the case. (Docs. 22-3-22-8.) It does not appear in any 11 of the documents attached by the Plaintiff or the Defendant that Plaintiff’s counsel gave 12 any explanation of the calculation other than asserting it was the limits of their authority. 13 Shortly after Plaintiff’s counsel filed his motion for judgment on the pleadings, the 14 parties agreed to stipulate to Defendant’s liability for statutory damages and costs. (Doc. 15 21 at 4.) Plaintiff’s counsel conceded that Plaintiff has suffered no actual damages, and 16 counsel agreed to engage in further talks in an attempt to settle the amount of attorney’s 17 fee’s owed. (Id.) After those talks remained unfruitful, Plaintiff filed this motion with the 18 Court seeking his attorney’s fees under the statute. 19 II. Rule of Law 20 “[I]n the case of any successful action to enforce [liability under the FDCPA],” a 21 debtor is entitled to recover “the costs of the action, together with a reasonable attorney's 22 fee as determined by the court.” 15 U.S.C. § 1692k(a)(3); Guerrero v. RJM Acquisitions 23 LLC, 499 F.3d 926, 949 (9th Cir. 2007). The award of fees in the case of a successful 24 action under the FDCPA is mandatory. Evon v. Law Offices of Sidney Mickell, 688 F.3d 25 1015, 1032 (9th Cir. 2012) (citing Bridgeport v. Camacho, 523 F.3d 973, 978 (9th Cir. 26 2008)). “The reason for mandatory fees is that congress chose a ‘private attorney general’ 27 approach to assume enforcement of the FDCPA.” Id. 28 A district court must calculate awards for attorneys’ fees using the “lodestar” 1 method. Ferland v. Conrad Credit Corp., 244 F.3d 1145, 1149 n.4 (9th Cir. 2001); 2 Defenbaugh v. JBC & Assocs. PC, No. 04-16866, 2006 U.S. App. LEXIS 19930 (9th Cir. 3 Aug. 3, 2006). “The ‘lodestar’ is calculated by multiplying the number of hours the 4 prevailing party reasonably expended on the litigation by a reasonable hourly rate.” 5 Morales v. City of San Rafael, 96 F.3d 359, 363 (9th Cir. 1996) (emphasis added). “A 6 district court should exclude from the lodestar amount hours that are not reasonably 7 expended because they are ‘excessive, redundant, or otherwise unnecessary.’” Van Gerwen 8 v. Guarantee Mut. Life Co., 214 F.3d 1041, 1045 (9th Cir. 2000) (quoting Hensley v. 9 Eckerhart, 461 U.S. 424, 434 (1983)). 10 “Although in most cases, the lodestar figure is presumptively a reasonable fee 11 award, the district court may, if circumstances warrant, adjust the lodestar to account for 12 other factors which are not subsumed within it.” Ferland, 244 F.3d at 1149 n.4. Thus, the 13 district court may adjust the “lodestar” figure upward or downward taking into 14 consideration twelve “reasonableness” factors: 15 (1) the time and labor required, (2) the novelty and difficulty of the questions 16 involved, (3) the skill requisite to perform the legal service properly, (4) the 17 preclusion of other employment by the attorney due to acceptance of the case, (5) the customary fee, (6) whether the fee is fixed or contingent, (7) time 18 limitations imposed by the client or the circumstances, (8) the amount 19 involved and the results obtained, (9) the experience, reputation, and ability of the attorneys, (10) the “undesirability” of the case, (11) the nature and 20 length of the professional relationship with the client, and (12) awards in 21 similar cases. 22 23 Evon, 688 F.3d at 1033 (quoting Morales, 96 F.3d at 363 n.8). Because the lodestar amount 24 is presumptively reasonable, an adjustment of the amount upward or downward should 25 only occur in “‘rare’ and ‘exceptional’ cases, supported by both ‘specific evidence’ on the 26 record and detailed findings’…that the lodestar amount is unreasonably low or 27 unreasonably high.” Van Gerwen, 214 F.3d at 1045 (citing Pennsylvania v. Delaware 28 Valley Citizens' Council for Clean Air, 478 U.S. 546, 565 (1986) (quoting Blum v. Stenson, 1 465 U.S. 886 (1984)); Blum, 465 U.S. at 897; D'Emanuele v. Montgomery Ward & Co., 2 904 F.2d 1379, 1384, 1386 (9th Cir. 1990); Cunningham v. County of Los Angeles, 879 3 F.2d 481, 487 (9th Cir. 1989)). 4 III. Analysis 5 Plaintiff argues that he is entitled to fees in excess of $7,000.00 for his efforts 6 pursuing this case. However, Defendant argues, and this Court agrees, that a portion of 7 these fees were only accrued due to Plaintiff’s continued push for more than his statutory 8 damages and pursuit of remedies not provided under the FDCPA. Throughout settlement 9 negotiations Plaintiff continually insisted upon Defendant’s removal of the trade line 10 memorializing his debt despite the fact that no such remedy is available under the statute. 11 In addition, Plaintiff consistently insisted upon settlement amounts well in excess of the 12 total value of the case despite his clear lack of any non-statutory damages. When Defendant 13 sought clarification of the basis of these settlement amounts, Plaintiff continuously refused 14 to extrapolate with any explanation other than listing it as the lower limit of his settlement 15 authority. 16 Additionally, as of February 12, 2020, the Defendant offered Plaintiff a judgment 17 (Doc. 22 at 5), along with $3500.00. That offer essentially gave Plaintiff a formal 18 judgement and an amount that nearly represented his maximum statutory damages with all 19 his fees and costs. (Doc. 21 at 3; Doc. 20-2 at 4-7.) Instead of communicating with 20 Defendant regarding the $146.50 discrepancy between Defendant’s offer and Plaintiff’s 21 maximum recovery, Plaintiff elected to continue to litigate the case, spending 22 approximately six hours and billing more than $2,300.00 drafting a motion for partial 23 judgment on the pleadings. Plaintiff’s motion largely sought the Court’s decision of issues 24 to which the Defendant had already offered to stipulate. (Docs. 13; 20-2.) Plaintiff then 25 informed the Defendant his new minimum offer to settle was $7,500.00 plus deletion of 26 the trade line. (Doc. 21-3.) 27 If the Plaintiff had confined his cause of action to the remedies actually available to 28 him, rather than asking for damages he did not have, the case would have settled much 1 || earlier. The Court declines to force the Defendant to shoulder the costs of the □□□□□□□□□□□ unreasonable actions. As such, the Court finds that Plaintiff's fees that accrued after February 12, 2020 were not “reasonably expended” on the litigation.” 4 IV. Conclusion 5 Accordingly, 6 IT IS ORDERED that the Plaintiff is granted his attorney fees in the in the amount of $4,847.50. 8 Dated this 29th day of December, 2020. 9 10 a . ~P i oO

12 Gaited States District udge, 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 || 7 Defendant having not objected, the Court also grants Plaintiff his attorney’s fees accrued by the submitting of this motion in the amount of $2,205.00 -6-