Roe v. Deutsche Bank National Trust Company NA

• Court: District Court, W.D. Washington
• Decided: February 4, 2025
• Docket: 3:24-cv-05338
• Status: Unknown

Opinion

1 2 3

4 5 UNITED STATES DISTRICT COURT 6 WESTERN DISTRICT OF WASHINGTON AT TACOMA 7 JAN ROE, Case No. 3:24-cv-05338 8 Plaintiff, ORDER GRANTING IN PART AND 9 DENYING IN PART DEFENDANTS’ v. MOTION FOR ATTORNEYS FEES 10 DEUSTCHE BANK NATIONAL TRUST 11 CO. NA et al.,

12 Defendants. 13

14 I. INTRODUCTION AND BACKGROUND 15 On November 1, 2024, the Court granted Defendants’ motion to dismiss against Plaintiff 16 Jan Roe. See Dkt. 46. Plaintiff alleged that Washington law had started the clock on the statute of 17 limitations for a Deed of Trust held by Defendants on Plaintiff’s property. Id. at 1–2. Plaintiff 18 claimed that the statute of limitations had run, and she was entitled to quiet title. Id. at 1. The 19 Court, following two Washington State Supreme Court decisions, disagreed. Id. at 2. Thus, it 20 dismissed the case and entered judgment against Plaintiff. Id. at 21; Dkt. 47. 21 In the same order, the Court denied Defendants’ motion for sanctions against Plaintiff. 22 Dkt. 46. Defendants argued that Plaintiff should have known that her claim had little merit when 23 she filed it in federal court. See Dkt. 33 at 2, 18. But Defendants failed to comply with the 24 1 procedural requirements for sanctions and offered little evidence in support of their claims. 2 Dkt. 46 at 2, 17. Accordingly, the Court denied their motion. 3 On November 15, 2024, Defendants moved for attorney’s fees. Dkt. 48. Defendants

4 claim that they are entitled to an award for attorney’s fees and costs under both Washington state 5 statute (RCW 4.84.330) and a provision of the Deed of Trust for their work on the motion to 6 dismiss and the motion for sanctions. Id. at 1. The Court finds that Defendants are entitled to 7 recover fees for the successful motion to dismiss, but it would be unreasonable to grant 8 Defendants’ request for fees for the motion for sanctions. Thus, the Court GRANTS in part and 9 DENIES in part Defendants’ motion. 10 II. LEGAL STANDARD According to Rule 54(d)(2)(A): “A claim for attorney’s fees and related nontaxable 11 expenses must be made by motion unless the substantive law requires those fees to be proved at 12 trial as an element of damages.” Fed. R. Civ. P. 54(d)(2)(A). The motion must be filed no later 13 than 14 days after entry of the judgment, detail the judgment and the grounds entitling the award, 14 state the amount sought or provide a fair estimate of the amount, and, if ordered, disclose the 15 terms of the agreement for fees. Fed. R. Civ. P. 54(d)(2)(B). 16 “District courts must calculate awards for attorneys’ fees using the ‘lodestar’ method.” 17 Camacho v. Bridgeport Fin., Inc., 523 F.3d 973, 978 (9th Cir. 2008) (quotation marks and 18 citation omitted). “The ‘lodestar’ is calculated by multiplying the number of hours the prevailing 19 party reasonably expended on the litigation by a reasonable hourly rate.” Id. The lodestar figure 20 is “presumptively a reasonable fee award,” but “the district court may, if circumstances warrant, 21 adjust the lodestar to account for other factors which are not subsumed within it.” Id.; see Kerr v. 22 Screen Extras Guild, Inc., 526 F.2d 67, 70 (9th Cir. 1975) (enumerating 12 factors to consider), 23 abrogated on other grounds by City of Burlington v. Dague, 505 U.S. 557 (1992). 24 1 District courts do not apply the Kerr factors in every case. “[T]here is a ‘strong 2 presumption’ that the lodestar figure is reasonable,” Perdue v. Kenny A. ex rel. Winn, 559 U.S. 3 542, 554 (2010), and the Kerr factors “are largely subsumed within the initial calculation of

4 reasonable hours expended at a reasonable hourly rate, rather than the subsequent determination 5 of whether to adjust the fee upward or downward,” Chalmers v. City of Los Angeles, 796 F.2d 6 1205, 1212 (9th Cir. 1986); see also Ballen v. City of Redmond, 466 F.3d 736, 746 (9th Cir. 7 2006) (“We have previously said that only in rare circumstances should a court adjust the 8 lodestar figure, as this figure is the presumptively accurate measure of reasonable fees.”). 9 Under Federal Rule of Civil Procedure 54(d)(2)(C), when ruling on a motion for 10 attorney’s fees, the Court “must find the facts and state its conclusions of law as provided in Rule 11 52(a),” meaning “the court must find the facts specially and state its conclusions of law 12 separately.” Fed. R. Civ. P. 52(a)(1), 54(d)(2)(C).

13 III. DISCUSSION 14 A. Defendants may recover fees and costs under the Deed of Trust. Before making its findings of fact and law on the reasonableness of the fees sought, the 15 Court must address several legal issues raised in the briefing. “[P]arties are ordinarily required to 16 bear their own attorney’s fees—the prevailing party is not entitled to collect from the loser.” 17 Buckhannon Bd. & Care Home, Inc. v. W. Virginia Dep't of Health & Hum. Res., 532 U.S. 598, 18 602–04 (2001) (citing Alyeska Pipeline Service Co. v. Wilderness Society, 421 U.S. 240, 247 19 (1975)). Under this rule, courts follow “a general practice of not awarding fees to a prevailing 20 party absent explicit statutory authority.” Id. (quoting Key Tronic Corp. v. United States, 511 21 U.S. 809, 819 (1994)). The movant bears the burden of establishing its entitlement to an award of 22 fees. Hensley v. Eckerhart, 461 U.S. 424, 437 (1983). 23 24 1 But the burden is on the losing party to overcome the presumption under Rule 54(d)(1) 2 that the prevailing party should be allowed their costs. Save Our Valley v. Sound Transit, 335 3 F.3d 932, 946 (9th Cir. 2003). Though the rule “creates a presumption in favor of awarding costs

4 to a prevailing party,” it “vests in the district court discretion to refuse to award costs.” Ass’n of 5 Mexican-Am. Educators v. State of Cal., 231 F.3d 572, 591 (9th Cir. 2000) (en banc). 6 “State law governs the interpretation of agreements that contain fee provisions, and thus 7 the entitlement to fees based thereon.” EHM Prods., Inc. v. Starline Tours of Hollywood, Inc., 8 No. 2:18-CV-00369-AB-JCX, 2024 WL 1135685, at *1 (C.D. Cal. Feb. 12, 2024) (citing 9 Security Mortgage Co v. Powers, 278 U.S. 149, 154 (1928) (“The construction of the contract for 10 attorney’s fees presents, likewise, a question of local law.”)).“The general rule in Washington is 11 that attorney fees will not be awarded for costs of litigation unless authorized by contract, statute, 12 or recognized ground of equity.” Durland v. San Juan Cnty., 182 Wn. 2d 55, 76, 340 P.3d 191

13 (2014) (citation omitted); see also Centro Veterinario y Agricola Limitada v. Aquatic Life Scis., 14 Inc., No. 2:23-CV-00693-LK, 2024 WL 915911, at *2 (W.D. Wash. Mar. 4, 2024) (similar). 15 RCW 4.84.330 authorizes attorney’s fees to the prevailing party in an action regarding a contract 16 containing an attorney fee provision. 4518 S. 256th, LLC v. Karen L. Gibbon, P.S., 195 Wn. 17 App. 423, 446, 382 P.3d 1 (2016). The statute may apply if “the contract containing the attorney 18 fee provision is central to the controversy.” Id. (quoting Hemenway v. Miller, 116 Wn.2d 725, 19 742, 807 P.2d 863 (1991)). 20 The complaint in the now-closed matter requested that this Court quiet title on the 21 underlying Deed of Trust. See Dkt. 34-2 at 8–9; Dkt. 34-1. If Plaintiff had prevailed, Defendants’ 22 interest in the property would have been terminated. Thus, the “lawsuit challenged the

23 underlying validity of the obligation” and Defendants’ defense “was undertaken to protect its 24 rights in the property.” Moseley v. CitiMortgage Inc., No. C11-5349RJB, 2011 WL 6151414, at 1 *3 (W.D. Wash. Dec. 12, 2011), aff’d, 564 F. App’x 300 (9th Cir. 2014) (citations omitted). The 2 claims are thus “on the contract” for purposes of the attorney fee provision in the Deed of Trust, 3 and Defendants may be awarded attorney’s fees for defending these claims. Id. (citing Deep

4 Water Brewing, LLC v. Fairway Resources Ltd., 152 Wn.App. 229, 278, 215 P.3d 990 (2009)). 5 Still, Plaintiff argues that a “debtor/borrower, (having been discharged as to all 6 obligations under the note which the deed of trust enforces),” cannot “still [be] held to any 7 attorneys’ fee provisions provided by the deed of trust or note.” Dkt. 51 at 6. Plaintiff thus “re- 8 raises the arguments she raised in her response to Deutsche Bank’s FRCP 12(b)(6) motion . . . 9 and now makes them concerning whether there is any right to attorney’s fees left in the original 10 deed of trust[.]” Id. (cleaned up). 11 Not only is this incorrect, but it is also an inappropriate argument to raise at this juncture. 12 An attorney fee motion is not an “appropriate vehicle” to relitigate already decided matters.

13 Mayorga v. Ronaldo, 656 F. Supp. 3d 1218, 1226 (D. Nev. 2023), appeal dismissed, No. 23- 14 15359, 2024 WL 4117282 (9th Cir. May 17, 2024) (explaining that motion for attorneys’ fees 15 was not the “appropriate vehicle for reconsideration of [the judge’s] prior order”); see also 16 Meola v. JKJ Investments Inc., No. SACV 04-00960-MLG, 2011 WL 1638163, at *2 (C.D. Cal. 17 Apr. 28, 2011) (“Defendant claims that the underlying action was meritless and fraudulent, and 18 therefore, Plaintiff is not entitled to any attorney’s fees or costs. This argument is rejected 19 because Defendant cannot now relitigate the merits of the underlying default judgment in its 20 opposition to this motion for attorney’s fees and costs.”); Boulter v. Hartford Fire Ins. Co., 321 21 F. Supp. 3d 1199, 1205 (D. Mont. 2018) (“Boulter does not need to relitigate liability for 22 attorney fees.”).

23 It is true that a bankruptcy discharge “releases the debtor from personal liability for her 24 pre-bankruptcy debts.” In re Ybarra, 424 F.3d 1018, 1022 (9th Cir. 2005) (citations omitted). But 1 that does not mean attorney fee provisions may not be enforced. Travelers Cas. & Sur. Co. of 2 Am. v. Pac. Gas & Elec. Co., 549 U.S. 443, 448–49 (2007). In a case governed by the 3 Bankruptcy Act of 1898, the Supreme Court found that “[t]he character of [a contractual]

4 obligation to pay attorney’s fees presents no obstacle to enforcing it in bankruptcy, either as a 5 provable claim or by way of a lien upon specific property.” Id. at 448 (quoting Security 6 Mortgage Co., at 154). More recently, the Supreme Court concluded that “under the terms of the 7 current Bankruptcy Code, it remains true that an otherwise enforceable contract allocating 8 attorney’s fees (i.e., one that is enforceable under substantive, nonbankruptcy law) is allowable 9 in bankruptcy except where the Bankruptcy Code provides otherwise.” Id. (citations omitted). 10 Section 727 of the Bankruptcy Code “discharges the debtor from all debts that arose 11 before the date of the order for relief.” Ybarra, 424 F.3d at 1022 (quoting 11 U.S.C. § 727(b)). 12 The Bankruptcy Code defines “debt” as “liability on a claim.” Id. (quoting 11 U.S.C. § 101(12)).

13 Courts have since held that “[A] claim arises, for purposes of discharge in bankruptcy, at the 14 time of the events giving rise to the claim.” Id. at 1022–23 (quoting O’Loghlin v. Cnty. of 15 Orange, 229 F.3d 871, 874 (9th Cir. 2000)). A claim that arises pre-bankruptcy is discharged in 16 the proceedings, but if the party “return[s] to the fray” they may be subject to new liability on a 17 claim. Id. at 1024 (citing Siegel v. Fed. Home Loan Mortg. Corp., 143 F.3d 525, 533 (9th Cir. 18 1998)). This is the case even if the litigation relates to a contract otherwise discharged in the 19 bankruptcy. Id. (discussing Siegel, 143 F.3d at 532–33). As the Ninth Circuit has explained, a 20 party’s “decision to pursue a whole new course of litigation” may make the party “subject to the 21 strictures of the attorneys fee provision.” Id. at 1023 (quoting Siegel, 143 F.3d at 534). In other 22 words, while bankruptcy may protect a party from the result of that party’s past acts, “including

23 attorney’s fees associated with those acts,” it does not give the party “carte blanche to go out and 24 commence new litigation about the contract without consequences.” Id. at 1024 (quoting Siegel, 1 143 F.3d at 534 (“In sum, we have held that post-petition attorney fee awards are not discharged 2 where post-petition, the debtor voluntarily ‘pursue[d] a whole new course of litigation,’ 3 commenced litigation, or ‘return[ed] to the fray’ voluntarily. . . . We have also endorsed the

4 notion that by voluntarily continuing to pursue litigation post-petition that had been initiated pre- 5 petition, a debtor may be held personally liable for attorney fees and costs that result from that 6 litigation.”) (cleaned up)). 7 The Court thus finds that the Defendants may bring this motion for attorney’s fees, and 8 Plaintiff may be required to pay them if otherwise reasonable. 9 B. Reasonableness of Requested Fee 10 Next, Plaintiff challenges the reasonableness of the requested fee. Dkt. 51 at 9. 11 Specifically, Plaintiff argues that the fees “are not awardable because many of those fees/hours 12 are for Deutsche Bank motions which were not granted or for work that was not reasonably

13 necessary to defend against Plaintiff Roe’s claims.” Id. 14 A district court may, in its discretion, make deductions if it finds that it would be 15 unreasonable to grant the full requested award based on “the limited success” achieved in the 16 litigation. Sorenson v. Mink, 239 F.3d 1140, 1147 (9th Cir. 2001) (citing Hensley, 461 U.S. at 17 436–37). The Supreme Court has created a two-step process for analyzing a deduction for 18 “limited success.” Id. (citing Hensley, 461 U.S. at 434). The first step considers whether “the 19 plaintiff fail[ed] to prevail on claims that were unrelated to the claims on which he succeeded.” 20 Id. (citing Hensley, 461 U.S. at 434). Claims are “unrelated” if they are “entirely distinct and 21 separate” from the claims on which the party prevailed. Id. (citing Odima v. Westin Tucson 22 Hotel, 53 F.3d 1484, 1499 (1995)). The second step assesses whether “the plaintiff achieve[d] a

23 level of success that makes the hours reasonably expended a satisfactory basis for making a fee 24 award.” Id. (quoting Hensley, 461 U.S. at 434). Here, the district court “should focus on the 1 significance of the overall relief obtained by the [party] in relation to the hours reasonably 2 expended on the litigation.” Id. (quoting Hensley, 461 U.S. at 435). 3 The Court finds that it would be unreasonable to award Defendants fees for their

4 unsuccessful sanctions motion. See, e.g., Elf-Man, LLC v. Lamberson, No. 13-CV-0395-TOR, 5 2015 WL 11112498, at *5 (E.D. Wash. Jan. 9, 2015) (citing Sorenson, 239 F.3d at 1147). 6 “Although a prevailing party need not prevail on each matter in order to be entitled to full fees, 7 . . . this is not such a case.” Id. (citing Hensley, 461 U.S. at 435). The claims are certainly related. 8 Defendants’ motion for sanctions was filed in response to Plaintiff’s complaint. See generally 9 Dkt. 33. But Defendants’ motion for sanctions was unsuccessful because Defendants failed to 10 comply with the procedural requirements of Rule 11 and offered no evidence of Plaintiff’s bad 11 faith for sanctions under 28 U.S.C. § 1927 and Local Rule 11(c)(3). Dkt. 46 at 16–21. Thus, as 12 laid out further below, the Court finds that time spent researching and briefing the unsuccessful

13 motion for sanctions should be excluded. 14 IV. FINDINGS OF FACT To calculate the lodestar amount, the Court relies on the following findings of fact. 15 1. Though Plaintiff challenges the reasonableness of Defendants’ fee rates, based on 16 both geography and experience, Dkt. 51 at 8, the Court finds that the rates are 17 reasonable. 18 2. Defendants’ counsel seeks the following fees for its work on both the motion to 19 dismiss and the motion for sanctions: 20 Timekeeper Hours Billed for 12(b)(6) Fee 21 Motion 22 Spencer Rossini 80.7 $24,210.00 23 Joseph T. McCormick 8.2 $3,239.00 24 1 Lukasz I. Wozniak .3 $118.50 2 Gwen H. Ribar .4 $158.00 3 Todd E. Chvat .3 $103.50

4 Total Fee $27,829.00 5 Dkt. 48 at 11. 6 3. Plaintiff disputes that Defendants should receive awards for its successful motion 7 to dismiss. Dkt. 51 at 6. As laid out above, the Court finds that Defendants can 8 and should be awarded those fees. See Section III.A. 9 4. Though Defendants request fees for their motion for sanctions, the Court finds 10 that such fees would be unreasonable, given both that the motion failed and that 11 Defendants failed to comply with the procedural and evidentiary requirements 12 necessary for the motion. The entries listed in the table below must be removed 13 from the hours reasonably expended: 14 Timekeeper Date Description of Entry Hours Sought Fees Sought 15 Spencer Rossini 6/24/24 Begin outlining arguments 0.90 $270.00 in motion for sanctions 16 6/24/24 Research related to federal 0.90 $270.00 authorities governing 17 monetary sanctions for bad faith litigation 18 6/25/24 Begin drafting motion for 2.40 $720.00 sanctions, preparing 19 introduction and factual background sections 20 6/25/24 Continue drafting motion 0.90 $270.00 for sanctions, adding 21 argument sections pertaining to Plaintiff’s 22 failure to acknowledge Washington case law 23 6/26/24 Continue drafting motion 0.80 $240.00 for sanctions, preparing 24 1 arguments that court may impose sanctions under 2 statute as well as through inherent powers. 3 6/27/24 Continue drafting 1.20 $360.00 arguments that court may 4 sanction plaintiff under its inherent authority as well 5 as argument describing plaintiff’s counsel’s bad 6 faith conduct 6/28/24 Research Washington 0.80 $240.00 7 district court cases dealing with sanctions for 8 initiating frivolous lawsuits 9 6/28/24 Continue drafting motion 2.40 $720.00 for sanctions, adding to 10 factual background and argument sections 11 connecting plaintiff’s counsel’s conduct to 12 sanctionable offenses 6/29/24 Draft declaration in 2.10 $630.00 13 support of motion for sanctions 14 6/30/24 Continue drafting motion 1.20 $360.00 for sanctions, adding to 15 argument connecting plaintiff’s counsel’s 16 actions to court’s bad faith requirement 17 7/8/24 Continue drafting motion 2.90 $870.00 for sanctions, preparing 18 arguments on why FRCP 11 allows for imposing 19 sanctions as well as adding facts surrounding 20 prior case’s ruling on motions for fees 21 7/8/24 Revise and continue 0.80 $316.00 drafting motion for 22 sanctions 7/10/24 Review and finalize 1.40 $420.00 23 motion for sanctions 7/10/24 Review and finalize 1.20 $360.00 24 declaration in support of 1 motion for sanctions and accompanying exhibits 2 8/16/24 Revise motion for 0.30 $90.00 sanctions and supporting 3 declaration to exclude reference to state court’s 4 pending entry of order on motion for fees 5 9/9/24 Draft supplemental 0.60 $180.00 memorandum in support 6 of motion for sanctions 9/9/24 Draft declaration in 0.30 $90.00 7 support of supplemental memorandum 8 10/10/24 Correspondence with 0.20 $60.00 opposing counsel and 9 court confirming parties must exchange briefing on 10 motion for sanctions 10/14/24 Review plaintiff’s 0.80 $240.00 11 opposition to motion for sanctions 12 10/15/24 Draft reply to opposition 5.60 $1,680.00 to motion for sanctions 13 10/16/24 Continue drafting reply 0.50 $150.00 brief, adding to arguments 14 on factors for imposing sanctions present 15 10/16/24 Review plaintiff’s 0.10 $30.00 supplemental declaration 16 in support of response to motion for sanctions 17 10/18/24 Correspondence with 0.60 $180.00 court and opposing 18 counsel regarding plaintiff’s deadline to 19 have submitted opposition to motion for sanctions 20 10/18/24 Review court order 0.10 $30.00 allowing plaintiff to file 21 surreply to motion for sanctions 22 10/21/24 Review plaintiff’s 0.60 $180.00 surreply to motion for 23 sanctions and supporting declaration 24 1 11/1/24 Review and analyze 0.50 $150.00 court’s order granting 2 motion to dismiss and denying motion for 3 sanctions 11/4/24 Assess merits of 0.20 $60.00 4 proceeding with motion to reconsider motion for 5 sanctions and motion for fees as prevailing party 6 Joseph T. 7/9/24 Draft additional proposed 0.30 $118.50 7 McCormick revisions to motion for sanctions 8 10/16/24 Review and propose 0.80 $316.00 revisions to Objection and 9 Reply to untimely Response to Motion for 10 Sanctions Total Fee $9,600.50 11 Reductions

Dkt. 49. 12 5. Apart from the above reductions, the hours otherwise sought in Defendants’ fee 13 petition were reasonably expended. 14 6. The Court’s reductions in fees sought by Defendants total $9,600.50. 15 The fees sought minus the Court’s reductions total $18,228.50. 16 V. FINDINGS OF LAW 17 1. Federal Rule of Civil Procedure 54(d)(2) provides that “[a] claim for attorney’s 18 fees and related nontaxable expenses must be made by motion unless the 19 substantive law requires those fees to be proved at trial as an element of 20 damages.” Fed. R. Civ. Proc. 54 (d)(2). The motion must be made within fourteen 21 days after the entry of judgment. Id. 22 23 24 1 2. Defendants may, in reliance on Section 9 of the Deed of Trust, add the attorney’s 2 fees and costs to the Deed of Trust amount. See United States v. Jefferson, No. 3 C19-0211-JCC, 2021 WL 4709898, at *2-3 (W.D. Wash. Oct. 8, 2021). 4 3. The Court approves reasonable hourly rates of $300 per hour for associate 5 Spencer Rossini; $395 per hour for senior associate Joseph T. McCormick II; 6 $395 per hour for partner Gwen H. Ribar; $395 per hour for partner Lukasz I. 7 Wozniak; and $345 per hour for senior associate Todd E. Chvat. Dkt. 49 at 2-3. 8 4. Defendants are entitled to their reasonable attorney’s fees in preparing this fee 9 petition. See Anderson vy. Dir., Office of Workers Comp. Programs, 91 F.3d 1332, 10 1325 (9th Cir. 1996); TVE, Inc. v. Harmony Enterprises, Inc., No. C18-1461-JCC, 11 2019 WL 5213247, at *1 (W.D. Wash. Oct. 16, 2019). 12 5. The requested amount is reasonable as to the motion to dismiss, but not the 13 motion for sanctions. It is reduced by the amount requested for time spent on the 14 motion for sanctions: $9,600.50. The fees sought minus the Court’s reductions 15 total $18,228.50. The lodestar amount of attorney’s fees is $18,228.50. 16 6. The Court awards Defendants $18,228.50 in attorney’s fees. 17 7. The Court awards Defendants $288.35 in reasonable costs ($189.35 for the Title 18 Report and $99.00 for the Superior Court transcript). Dkt. 49 at 3-4. 19 VI. CONCLUSION 0 Dated this 4th day of February, 2025.

Tiffany M. Cartwright United States District Judge 23 24 ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION FOR ATTORNEYS FEES