Am. Home Assurance Co. v. Weaver Aggregate Transp., Inc.

• Decision Date: 26 February 2015
• Docket Number: Case No. 5:10–cv–329–Oc–10PRL.
• Citation: 89 F.Supp.3d 1294
• Parties: AMERICAN HOME ASSURANCE COMPANY, a New York corporation, Plaintiff, v. WEAVER AGGREGATE TRANSPORT, INC., a Florida corporation, Beacon Industrial Staffing, Inc., a Michigan corporation, Defendants. Weaver Aggregate Transport, Inc., a Florida corporation, Crossclaim Plaintiff, v. Beacon Industrial Staffing, Inc., a Michigan corporation, Crossclaim Defendant.
• Court: U.S. District Court — Middle District of Florida

89 F.Supp.3d 1294

AMERICAN HOME ASSURANCE COMPANY, a New York corporation, Plaintiff

v.WEAVER AGGREGATE TRANSPORT, INC., a Florida corporation, Beacon Industrial Staffing, Inc., a Michigan corporation, Defendants.

Weaver Aggregate Transport, Inc., a Florida corporation, Crossclaim Plaintiff

v.Beacon Industrial Staffing, Inc., a Michigan corporation, Crossclaim Defendant.

Case No. 5:10–cv–329–Oc–10PRL.

United States District Court, M.D. Florida, Ocala Division.

Signed Feb. 26, 2015.

Aaron S. Weiss, Steven J. Brodie, Thomas Meeks, Carlton Fields Jorden Burt, PA, Miami, FL, Alexander David Del Russo, Carlton Fields Jorden Burt, PA, West Palm Beach, FL, for Plaintiff.

John Wesley Frost, II, Frost, Van Den Boom & Smith, PA, Bartow, FL, Timothy Allen Andreu, Glenn Rasmussen, PA, Tampa, FL, for Defendants.

Claude M. Harden, III, Appel Harden Law Group, Lakeland, FL, for Defendant/Crossclaim Defendant.

ORDER

WM. TERRELL HODGES, District Judge.

On November 10, 2014, the United States Magistrate Judge issued a detailed and well-reasoned Report and Recommendation (Doc. 298) recommending that Plaintiff American Home Assurance Company's Motion for Award of Attorney's Fees, Costs, and Pre–Judgment Interest against Defendant Weaver Aggregate Transport Inc. (Doc. 239) be granted in substantial part. Weaver Aggregate Transport Inc. (“Weaver”) has filed 50 pages of Objections with another 57 pages of exhibits (Doc. 306), American Home Assurance Company (“American Home”) has filed a response in opposition to the Objections (Doc. 319), and with leave of Court, (Doc. 322), Weaver has filed a reply (Doc. 323). The Court has therefore conducted a de novo review of American Home's motion for fees, costs, and interest. See 28 U.S.C. § 636, M.D. Fla. Local Rule 6.02.

Factual Background

American Home issued two workers' compensation and employer liability insurance policies to Weaver. The workers covered by the policies were provided to and performed work for Weaver pursuant to a Client Services Agreement between Weaver and Defendant Beacon Industrial Staffing, Inc. (“Beacon”). On July 22, 2010, American Home filed this action against Weaver and Beacon, contending that they both provided false information to American Home concerning the number of covered employees, the types of work the employees performed, and the geographical location of the employees; and, as a result, American Home claimed that Weaver and Beacon underpaid the premiums on the policies by over $400,000.

American Home asserted claims against Weaver and Beacon seeking recovery on theories of breach of contract, unjust enrichment, open account, account stated, and fraudulent inducement. At the conclusion of a five-day trial, the jury found in favor of American Home and against Weaver and Beacon on all but one claim,¹ and that Weaver and Beacon were jointly and severally liable to American Home in the amount of $404,013 (Doc. 232). Judgment was entered to that effect on February 3, 2014 (Doc. 236).

American Home subsequently moved for $292,945.50 in attorney's fees, $6,663.01 in costs, and $73,893.03 in pre-judgment interest (Doc. 239). American Home asserted as authority for this request Florida's offer of judgment statute, Fla. Stat. § 768.79.² In response, Weaver argued that the Florida statute should not apply because none of American Home's claims were based in Florida law, and that the fees requested were excessive.

The Magistrate Judge determined that Fla. Stat. § 768.79 applied to this case, and after conducting a lodestar analysis, see Loranger v. Stierheim, 10 F.3d 776 (11th Cir.1994), recommended an award of $289,737.50 in attorney's fees. The Magistrate Judge reached this calculation by reducing the hourly rate charged by Attorney Meeks from $416 to $400, to account for the prevailing market rates in the Ocala Division. The Magistrate Judge found all other hourly rates to be reasonably consistent with market rates in the Ocala Division. He also concluded that all of the hours American Home requested were reasonable, supported by billing records and affidavits, and were not properly contested by Weaver as required by applicable Eleventh Circuit precedent. See ACLU v. Barnes, 168 F.3d 423, 428 (11th Cir.1999). See also Scelta v. Delicatessen Support Servs., Inc., 203 F.Supp.2d 1328, 1333 (M.D.Fla.2002) ( “Accordingly, a fee opponent's failure to explain exactly which hours he views as unnecessary or duplicative is generally viewed as fatal.”). Lastly, the Magistrate Judge determined that American Home was entitled to almost all of the requested costs, and all of the requested pre-judgment interest.

Weaver's Objections

Weaver first objects to the Magistrate Judge's finding that Fla. Stat. § 768.79 applies to this case and mandates an award of attorney's fees to American Home. In particular, Weaver argues that American Home's claims were not governed by Florida law, but rather by New York, Michigan, and/or Illinois law, and therefore Florida's offer of judgment statute does not apply. The Magistrate Judge rejected this argument for two reasons. First, the Magistrate Judge found that there was no contractual choice of law provision in any of the insurance contracts mandating the application of any other state's law—rather the choice of law questions arose solely from the common law choice of law jurisprudence applied in diversity jurisdiction cases (i.e., lex loci contractus ). Second, the Magistrate Judge noted that “there is no indication that the district judge applied anything other than substantive Florida law” to American Home's claims. (Doc. 298, p. 1304).

The Magistrate Judge's first point rests on an interpretation of the Florida Supreme Court's decision in Southeast Floating Docks, Inc. v. Auto–Owners Ins. Co., 82 So.3d 73 (Fla.2012). In Southeast Floating Docks, the Florida Supreme Court determined that Florida's offer of judgment statute is substantive law for conflict of law purposes, and held that the statute does not apply in instances where parties have contractually agreed to be bound by the substantive laws of another forum. 82 So.3d at 80–82. Specifically, the Court held that “Florida's offer of judgment statute, set forth in section 768.79, creates a substantive right to costs and attorney's fees upon the satisfaction of certain conditions. Accordingly, under a conflict of law analysis, when parties have agreed to be bound by the substantive law of another jurisdiction, section 768.79 simply does not apply.” Id. at 82. Applying Southeast Floating Docks to thiscase, the Magistrate Judge found that because none of American Home's insurance policies contained a choice of law provision, American Home and Weaver did not contractually agree to be bound by the substantive law of another state, and therefore Southeast Floating Docks did not govern this case, and Fla. Stat. § 768.79 could apply.

The Court agrees with the Magistrate Judge. There are no contractually mandated choice of law provisions in existence in this case, and Southeast Floating Docks clearly is limited to situations where parties contractually agree to be bound by a specific state's law. The Court rejects Weaver's attempts to expand the application of Southeast Floating Docks to include cases where the parties have not contractually agreed to be bound by a choice of law provision. See Diamond Aircraft Indus., Inc. v. Horowitch, 107 So.3d 362, 371–72 (Fla.2013) (noting that Southeast Floating Docks only addressed situations were a contract with a choice of law provision required the application of another state's law, and finding that Fla. Stat. § 768.79 governs where the trial court applied Florida law to some claims, and another state's law to a deceptive trade practices claim based on the facts and not a contractual choice of law provision). Moreover, with one exception,³ the decisions cited by Weaver are unpersuasive.⁴

Thus, as the Magistrate Judge correctly noted, Florida's offer of judgment statute should apply to this case. And, despite Weaver's arguments to the contrary, it is clear from the facts and evidence adduced at trial and this Court's jury instructions that Florida law applied at least to American Home's fraudulent inducement and unjust enrichment claims—claims that American Home prevailed on, and in which the jury awarded damages in the amount of $404,013.00 (Doc. 232)—thereby rendering Fla. Stat. § 768.79 applicable.⁵ Weaver's Objections to the application of Fla. Stat. § 768.79 will be overruled.

Weaver next objects to the Magistrate Judge's determination of the amount of fees and costs to be awarded American Home. Specifically, Weaver argues that the hourly rates are unreasonably high and do not reflect the prevailing market rates in Ocala, Florida. Weaver also contends that the hours requested are excessive, duplicative, and consist of hours spent prosecuting claims against Beacon. Lastly, Weaver argues that the Magistrate Judge failed to account for the factors set forth in Fla. Stat. § 768.79.

Weaver did not raise any of these arguments in its original response to American Home's motion. Instead, Weaver merely stated that “In this case, the total amount of fees incurred by American Home is excessive compared to the fees incurred by Weaver, who prosecuted two cross-claims and one third party complaint, and defended American Home's aggressive prosecution of this action. Furthermore, American Home seeks to obtain a second judgment in fees that is nearly three-fourths as much of its judgment.” (Doc. 251, p. 6).

It is the law of this Circuit that “a district court has discretion to decline to consider a party's argument when that argument was not first presented to the magistrate judge.” Williams v. McNeil, 557 F.3d 1287, 1292 (11th Cir.2009). “[T]o require a district court to consider evidence not previously presented to the magistrate judge would effectively nullify the magistrate judge's consideration of the matter and would not help to relieve the workload of the district court....