O'Rear v. American Family Life Assurance Co. of Columbus, Inc.

144 F.R.D. 410, 1992 U.S. Dist. LEXIS 15948, 1992 WL 296745
District Court, M.D. Florida·Decided October 15, 1992·No. No. 91-148-CIV-T-17C·Published·Cited by 15 cases

Opinion

ORDER AWARDING ATTORNEY’S FEES AND EXPENSES

KOYACHEVICH, District Judge.

This cause is before the Court on the joint application of defendants’ counsel— MANG, RETT, & COLLETTE of the Florida Bar, and ALSTON & BIRD of the Georgia Bar — for an award of attorneys’ fees and expenses. It is opposed as to award and amount by plaintiff’s counsel — PAUL A. NELSON.

This action was brought by Plaintiff, THOMAS P. O’REAR, originally naming only AMERICAN FAMILY LIFE ASSURANCE COMPANY OF COLUMBUS, INC. [412] (American Family) as a defendant and included claims for: 1) breach of contract; 2) violation of covenant of good faith and fair dealing; and 3) fraud and misrepresentation.

Upon service of the summons and complaint, American Family filed motions to dismiss and to strike. The plaintiff, in response, conceded that Counts I and III of the complaint were deficient and moved for leave to amend. The Court granted the leave to file the amended complaint.

The first amended complaint again named AMERICAN FAMILY LIFE ASSURANCE COMPANY OF COLUMBUS, INC. as the sole defendant and replead the same three (3) counts (breach of contract, violation of implied covenant of good faith and fair dealing, and fraud and misrepresentation) without substantial difference from the original complaint.

Defendant, American Family, again filed a motion to dismiss and an alternative motion to strike portions of Counts I and III. A response was then filed by Plaintiff admitting that, though he made a good faith effort, the first amended complaint may have fallen short of the “particularity” requirements of Rule 9, Fed.R.Civ.P. as to Count II and yet again asked for leave to amend Count III.

Without waiting for the Court’s order, a second amended complaint was filed, which named as additional defendants the trustees of AMERICAN FAMILY LIFE ASSURANCE COMPANY ASSOCIATE STOCK BONUS PLAN, in their individual and representative capacities. The second amended complaint also contained nine causes of action, six of which were added to the original three causes of action plead in the first complaint.

Defendants filed a motion to dismiss the second amended complaint. In response, Plaintiff voluntarily dismissed Counts I, II, IV, V, VI, VII, VIII and IX of the seconded amended complaint, seeking to amend all counts except VI, but requested that the motion to dismiss Count III be denied.

This Court, in an order dated October 18, 1991, found that the fraud claim (Count III) of the second amended complaint was insufficiently plead and granted the motion to dismiss as to that count.

Plaintiff admitted that “oversight and inadvertence” resulted in “repeated failure(s) to cure deficiencies by amendments previously allowed.” This, in turn, resulted in a considerable expenditure of time and effort for the Court, as well as the defendants, in researching, preparing, and filing the three (3) motions to dismiss.

In the order of October 18, 1991, this Court determined that if Plaintiff’s counsel chose to file a third amended complaint, he would pay costs and attorney’s fees for unreasonably multiplying the proceedings. Furthermore, the court determined that if a motion to dismiss was upheld in whole or in part against the Third Amended Complaint, Plaintiff’s attorney would compensate Defendants for any further costs and fees which resulted from preparing their response to the third amended complaint. Plaintiff then elected to file a third amended complaint which was dismissed in part. Accordingly, this Court grants Defendants attorneys’ fees under 28 U.S.C. § 1927, for the time expended in preparation of the first three (3) motions to dismiss. No fees were submitted for the motion to dismiss the third amended complaint and are therefore, not included.

The fee application submitted by defendants seeks an award in the amount of $36,280.50. The number of hours for which compensation is sought and the hourly rates requested are as follows:

MANG, RETT, & COLLETTE, P.A.

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[413] [[Image here]]

ALSTON & BIRD

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ATTORNEYS’ FEES:

STATUTORY BASIS

Plaintiff alleges that the Court can not award attorneys’ fees under 28 U.S.C. § 1927 because Plaintiff did not deliberately or intentionally act to unreasonably or vexatiously multiply the proceedings. As the Seventh Circuit explained, “[t]he purpose of ... section 1927 is to deter frivolous litigation and abusive practices by attorneys ... and to ensure that those who create unnecessary costs also bear them.” Kapco Mfg. Co., v. C & O Enterprises, Inc., 886 F.2d 1485 (7th Cir.1989) (citations omitted). Moreover, the Supreme Court stated in Roadway Express v. Piper, 447 U.S. 752, 100 S.Ct. 2455, 65 L.Ed.2d 488 (1979), that 28 U.S.C. § 1927 was concerned “only with limiting the abuse of court processes” and recognized- “the inherent power of a court to levy sanctions in response to abusive litigation practices.” Roadway Express at 762-765, 100 S.Ct. at 2462-2463.

Although the defendant has cited several cases requiring a showing of subjective bad faith on the part of the attorney, the Court finds that according to the statute all that is necessary is a showing that the attorney acted “unreasonably and vexatiously” by multiplying the proceedings. 28 U.S.C. § 1927 (1980). See Piljan v. Michigan Dept. of Social Services, 585 F.Supp. 1579 (E.D.Mich.1984) (Court determined section 1927 required a deliberate delay of the progress of the case and that lack of competence did not justify a section 1927 sanction).

In Wages v. I.R.S., 915 F.2d 1230 (9th Cir.1990), the Ninth Circuit upheld sanctions against a plaintiff under 28 U.S.C. § 1927 for bad faith conduct when she sought to amend her complaint that contained no claim for relief and was substantially the same as the complaint previously dismissed. See also, Stewart v. City of Chicago, 622 F.Supp. 35 (D.C.Ill.1985) (plaintiff’s counsel acted in bad faith and was sanctioned under 28 U.S.C. § 1927 for repleading the same deficient claims up to and including the second amended complaint).

In the bankruptcy division of this court, the counsel for plaintiff was sanctioned under 28 U.S.C. § 1927 for unreasonably multiplying the proceedings when he re-pleaded verbatim an initial complaint. Counsel’s behavior required the court to review two complaints and hold hearings on two motions to dismiss. In Re Brown, 126 B.R. 615 (Bkrtcy.M.D.Fla.1991).

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O'Rear v. American Family Life Assurance Co. of Columbus, Inc., 144 F.R.D. 410, 1992 U.S. Dist. LEXIS 15948, 1992 WL 296745 (M.D. Fla. 1992).

144 F.R.D. 410 (O'Rear v. American Family Life Assurance Co. of Columbus, Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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