JONATHAN GOODMAN UNITED STATES MAGISTRATE JUDGE
Plaintiffs
M&M Sisters, LLC, Bertha Menendez Garcia, and Maria
Mendez (collectively, “Plaintiffs” or
“M&M”) brought this action against their
insurer, Scottsdale Insurance Company
(“Scottsdale” or “Defendant”), in the
Circuit Court of the Eleventh Judicial Circuit in and for
Miami-Dade County, Florida on October 14, 2019. [ECF Nos. 1;
1-2]. Plaintiffs initially sought a declaratory judgment but
subsequent amendments to their pleadings sought to allege a
breach of contract claim.
On
November 19, 2021, Scottsdale removed this action to the
United States District Court for the Southern District of
Florida based on diversity jurisdiction, 28 U.S.C. §
1332. [ECF No. 1].[1]
On
March 28, 2022, Senior United States District Judge Federico
A. Moreno dismissed with prejudice Plaintiffs' Third
Amended Complaint for failure to state a claim. [ECF No. 18].
Plaintiffs filed a notice of appeal. [ECF No. 19]. The
Eleventh Circuit affirmed the with-prejudice dismissal of
Plaintiffs' Third Amended Complaint. See M&M
Sisters, LLC v. Scottsdale Ins. Co., No. 22-11290, 2022
WL 4231322 (11th Cir. Sept. 14, 2022).
Scottsdale
seeks to recover $17,136.50 in attorney's fees incurred
at the district court level, $17,478.00 in appellate
attorney's fees,[2] $1,072.00 for non-taxable expenses
pursuant to Florida's offer of judgment statute (Fla
Stat. § 768.79), and $402.00 in taxable costs pursuant
to 28 U.S.C. § 1920. [ECF Nos. 22-24; 32]. Plaintiffs
dispute Scottsdale's entitlement to fees and non-taxable
costs. [ECF Nos. 25; 37-1 in Case No. 22-11290].
Judge
Moreno has referred to the Undersigned for a Report and
Recommendations Scottsdale's motions for attorney's
fees and costs. [ECF Nos. 29; 35]. For the reasons stated
below, the Undersigned respectfully
recommends that the District Court grant in
part and deny in part Scottsdale's motions and
award Scottsdale $25,943.80 in
attorney's fees ($13,709.20 for district court fees and
$12,234.60 for appellate fees) and $402.00
in taxable costs.
I.
FACTUAL AND PROCEDURAL BACKGROUND
The
Eleventh Circuit succinctly summarized the factual and
procedural background of this case as follows:
M&M purchased a commercial general liability policy from
Scottsdale for an apartment building located at “1111
N.W. 43 Avenue, Miami, FL 33126.” The policy covered
“‘property damage' . . . caused by an
‘occurrence,'” which the policy defined as
“an accident, including continuous or repeated exposure
to substantially the same general harmful conditions.”
Under the policy, M&M would incur “property
damage” when it had “[p]hysical injury to
tangible property” or suffered a “[l]oss of use
of tangible property that is not physically injured.”
In May 2019, M&M filed a claim for damage to its
building, and Scottsdale assigned an adjuster to investigate.
In September 2019, M&M demanded an audio and video
recording of the inspection. Scottsdale refused.
In October 2019, M&M filed a complaint in a Florida court
for a declaratory judgment. M&M sought an order
compelling Scottsdale to record its inspection and declaring
that the claim was covered under the insurance policy and
that delays in inspecting the property and in determining
coverage constituted a constructive denial of coverage. On
Scottsdale's motion, the state court stayed the action
pending a determination of coverage.
In January 2021, Scottsdale denied M&M's claim.
Scottsdale determined that the loss was excluded from
coverage after its structural engineer attributed the damage
to the building to wear and tear in the roof and windows and
to faulty construction, repairs, maintenance, and materials
in the drainage system of the roof and on the roof. The
adjuster “determined
there was no damage to the roof of the building resulting
from wind or any other covered cause of loss, and no damage
to the interior of the [building] caused by an opening in the
roof . . . caused by wind or any other covered cause of
loss.”
In May 2021, M&M filed an amended complaint against
Scottsdale for breach of contract. M&M alleged that its
“Property sustained a sudden, accidental and/or
otherwise covered loss under the Policy, resulting in
extensive damage to the interior and exterior of the insured
risk.” M&M also alleged that Scottsdale had
“refuse[d] to perform” its duties “to
promptly investigate, adjust and issue payment for the
Covered Loss,” which “includ[ed], but [was] not
limited to, the actual cash value of the loss and/or
damages.”
***
In October 2021, M&M estimated its damages at
$2,591,333.16. Scottsdale removed the action to the federal
court based on diversity of citizenship, see 28
U.S.C. §§ 1332, 1446, and it moved to dismiss the
[then-operative Second Amended] [C]omplaint.
M&M Sisters, LLC, 2022 WL 4231322, at *1.
Ultimately,
Judge Moreno dismissed with prejudice Plaintiffs'
Third Amended Complaint. As discussed above,
Plaintiffs appealed Judge Moreno's ruling and lost.
While
the case was pending in state court, Scottsdale served on
June 21, 2021, three, separate Proposals for Settlement (one
proposal per Plaintiff). See [ECF No. 24-1]. The
Proposals for Settlement to each Plaintiff were identical
other than the name of the specifically designated Plaintiff
and the specific amount proposed. The Proposals for
Settlement stated that they were being made pursuant to Fla.
R. Civ. P. 1.442 and Fla. Stat. § 768.79 and were in the
following amounts: $334.00 to M&M Sisters, LLC, $333.00
to Bertha Menendez Garcia, and $333.00 to Maria Mendez.
Id.
Each
Proposal for Settlement stated, in pertinent part, as
follows:
2. This Proposal is intended to resolve any and all claims
against SCOTTSDALE as claimed and set forth in
[PLAINTIFF]'s Complaint in this action (Case No.
2019-030409-CA-01), arising out of or relating to alleged
property damage.
***
5. Upon acceptance of this Proposal, [PLAINTIFF] agrees that:
(a) No judgment reflecting the settlement will be entered
against SCOTTSDALE;
(b) [PLAINTIFF] will fully execute and return to counsel for
SCOTTSDALE the General Release and Settlement Agreement
attached to this Proposal; and
(c) [PLAINTIFF] agrees to stipulate to a Final Order of
Dismissal with Prejudice of this lawsuit against SCOTTSDALE.
6. The underlying claims relative to this Proposal do not
include a claim for punitive damages and, accordingly, no
portion of the proposed settlement amount relates to punitive
damages.
7. The total amount of this Proposal is inclusive of
attorneys' fees to the extent such fees are part of a
legal claim of this case.
Id. at 2-3, 10-11, 18-19.
Each
Proposal for Settlement included a General Release Agreement
and Settlement Agreement (“General Release”),
which included the following, relevant language:
WHEREAS, on or about May 9, 2019, the INSUREDS' public
adjuster, American Premier Claim Consultants, Inc., reported
to SCOTTSDALE that
a loss occurred at the above-mentioned location on or about
May 6, 2019, resulting in claimed real property damage at the
above-mentioned location;
WHEREAS, the INSUREDS claimed damages as a result of the
abovementioned loss;
WHEREAS, the INSUREDS made a claim against SCOTTSDALE as a
result of the loss;
WHEREAS, SCOTTSDALE assigned Claim No. 01892450 to the
INSUREDS' Claim[.]
***
NOW, THEREFORE, in consideration of the total sum of
[PROFFERRED AMOUNT], (which includes attorneys' fees and
costs) receipt and sufficiency of which payment is hereby
acknowledged by the undersigned, [PLAINTIFF], hereby fully
and forever releases and discharges SCOTTSDALE, its officers,
directors, employees, agents, adjusters, attorneys,
successors, and assigns, from any and all claims,
contractual, extra-contractual, and/or bad faith, arising
from the abovementioned loss, whether known or unknown,
through the date of this Release, any claim for
attorney's fees, costs, interest, and any claim regarding
any activity or action(s) of SCOTTSDALE, its officers,
directors, employees, agents, adjusters, and attorneys,
including claim settlement and handling procedures, libel,
slander, any claim pursuant to any assignment of benefits,
and any other action, claim, and demand of whatever nature
that [PLAINTIFF] has, may have, or might have in the future
as a result or consequence of the abovementioned loss.
IN FURTHER CONSIDERATION of the above-mentioned settlement
payment, [PLAINTIFF] will voluntarily dismiss with prejudice
the case captioned M&M Sisters, LLC, Bertha Menendez
Garcia, and Maria Mendez v. Scottsdale Insurance
Company, Case No. 2019-030409-CA-01, pending in the
Circuit Court of the Eleventh Judicial Circuit, in and for
Miami-Dade County, Florida, with each party to bear its own
costs and attorney's fees.
IN FURTHER CONSIDERATION of the above-mentioned settlement
payment, [PLAINTIFF] represents and warrants that it [or she]
will preserve, protect, hold harmless, and indemnify
SCOTTSDALE, its officers,
directors, employees, agents, adjusters, and attorneys from
any and all claims asserted against the above-mentioned
settlement proceeds and/or the abovementioned insurance
policy by any mortgagee, lienholder, or other third party
with respect to the above-mentioned loss. This agreement
includes payment of any attorney's fees, costs, and
defense-related expenses related to any such claim.
Id. at 5-7, 13-15, 21-23.
The
Proposals for Settlement remained open for 30 days and
expired without acceptance. Id.
Judge
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