Baughman v. United States Liab. Ins. Co.
| Citation | 723 F.Supp.2d 741 |
| Decision Date | 13 July 2010 |
| Docket Number | Civil No. 08-2901 (JBS/KW). |
| Parties | Becky BAUGHMAN, et al., Plaintiffs, v. UNITED STATES LIABILITY INSURANCE COMPANY, Defendant. |
| Court | U.S. District Court — District of New Jersey |
OPINION TEXT STARTS HERE
Scott B. Gorman, Esq., Gorman & Gorman, Esqs., Liberty View, Cherry Hill, NJ, for Plaintiffs Becky Baughman, Steven Baughman, and Kiddie Kollege Daycare & Preschool, Inc.
Lila Wynne, Esq., Marshall, Dennehey, Warner, Coleman & Goggin, PC, Cherry Hill, NJ, for Defendant United States Liability Insurance Company.
Presently before the Court is a motion submitted by Plaintiffs Becky and Stephen Baughman for summary judgment on damages for their successful breach of contract claim and for assessment of attorneys fees pursuant to New Jersey Court Rule 4:42-9(a)(6) [Docket Item 26]. Defendant United States Liability Company does not oppose summary judgment on damages, but objects to Plaintiffs' request for attorneys fees, arguing that they should not be imposed in this case and that even if imposed Plaintiffs request an unreasonable amount. For the reasons discussed below, the Court will grant Plaintiffs' motion for summary judgment as to damages in the amount of $82,695 and assess attorneys fees and costs in the amount of $208,748.5.
This action arose from a dispute regarding insurance coverage for several underlying state court actions arising out of alleged mercury contamination of Kiddie Kollege daycare center that had been owned by Plaintiffs. Defendant had declined to defend or indemnify Plaintiffs in the underlying actions despite their comprehensive general liability (“CGL”) policy. In May 2008, Plaintiffs brought suit seeking declaratory judgment declaring that Becky Baughman, Stephen Baughman, and Kiddie Kollege are all insureds under the insurance policy and that Defendant was obligated to defend and indemnify them in the underlying actions, as well as reformation of the insurance policy, and damages for breach of contract, breach of implied duty of good faith and fair dealing, common law fraud, and fraud under the New Jersey Consumer Fraud Act.
Both parties brought motions for summary judgment. 1 On November 18, 2009, the Court granted partial summary judgment in favor of Plaintiffs, finding that Defendant was liable to Plaintiffs for breach of contract and ordering Defendant to defend and indemnify Plaintiffs in the underlying state court suits. Baughman v. United States Liab. Ins. Co., 662 F.Supp.2d 386, 393-400 (D.N.J.2009). The Court granted partial summary judgment in favor of Defendant on Plaintiffs' claims for breach of implied duty of good faith and fair dealing, common law fraud, reformation, and for violations of the New Jersey Consumer Fraud Act. Id. at 400-01.
Plaintiffs now seek summary judgment on the question of damages and ask the Court to order Defendant to reimburse Plaintiffs for the attorneys fees and costs they incurred defending in the underlying class action suits. Plaintiffs request a total of $82,695. In support of this request Plaintiffs submit the affidavit of Michael Kassak, a partner at White and Williams, LLP, regarding the fees and costs of the underlying defense, along with contemporaneous billing records. Defendant does not oppose this request for damages, (Def. Opp'n at 2), and this portion of Plaintiffs' damages claim will be awarded in the amount of $82,695.
Plaintiffs also request attorneys fees and costs for pursuing the instant claim for coverage with the law firm Gorman & Gorman, LLC. Plaintiffs ask for a lodestar of $158,477, with $57,947 covering the services of Scott B. Gorman, Esquire, at an hourly rate of $325 for 178.3 hours of work on Plaintiff's successful claims, and $100,530 is sought for the services of Danielle Childs, Esquire, at an hourly rate of $225 for 446.8 hours of work on successful claims. 2 The Plaintiffs ask for an enhancement of 100% the lodestar under Rendine v. Pantzer, 141 N.J. 292, 661 A.2d 1202 (1995) as well as costs in the amount of $1,186, for a total award of fees and costs of $318,140. 3
The following chart summarizes the attorneys fees Plaintiffs seek as prevailing parties:
Mr. Gorman has been a practicing attorney for over twenty-nine years, twenty of which have been almost exclusively devoted to handling breach of contract claims, with a heavy focus on the insurance industry. (Gorman Aff. ¶ 4.) Ms. Childs has practiced law for over sixteen years, and has spent the past thirteen years with Gorman & Gorman devoting her time to legal research and writing on contract disputes, with a heavy focus on the insurance industry. ( Id. ¶ 5.) On June 1, 2007, Plaintiffs entered into a contingency fee agreement with Gorman & Gorman which states that “The Attorneys will be compensated for services rendered only if recovery is actually obtained for the Clients.” Gorman & Gorman has not billed, and will not bill, Plaintiffs for their services. (Gorman Aff. ¶ 10; Becky Baughman Certification ¶¶ 3-4.)
Mr. Gorman and Ms. Childs spent approximately one year gathering facts, performing legal research, preparing a demand letter to Defendant, preparing for litigation, and filing suit. (Gorman Aff. ¶¶ 12-13.) After initiation of the suit, the parties engaged in discovery, including requests for production of documents, exchange of interrogatories, and one deposition. (Gorman Aff. ¶ 14; Wynne ¶ 7.) Finally, Plaintiffs' attorneys worked on the motion practice both for their own motion for partial summary judgment and in opposition to Defendant's motion for summary judgment. (Gorman Aff. ¶ 14.)
In addition to Mr. Gorman's affidavit, and in further support of their request for fees, Plaintiffs offer the following evidence:
• Two affidavits from attorney Seth v.d.H. Cooley, Esquire, a partner at the law firm Duane Morris, LLP, certifying that the requested hourly rates for Mr. Gorman and Ms. Childs are “within the prevailing rates charged by attorneys with reasonably comparable skill, experience, and reputation” in southern New Jersey for environmental insurance coverage claims. (Cooley Certification ¶¶ 4-5; Cooley Supp. Certification ¶ 5.)
• Details regarding the date, number of hours, and type of work Mr. Gorman and Ms. Childs performed for Plaintiffs on this action. (Gorman Aff. Exhs. A-G; Gorman Supp. Aff. Exhs. K-L.)
• A sampling of contemporaneous time slips.
• A copy of Plaintiffs' contingency fee retainer agreement with Gorman & Gorman. ...
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