Camacho v. Bridgeport Financial, Inc.

• Decision Date: 22 April 2008
• Docket Number: No. 07-15297.,07-15297.
• Parties: Rita CAMACHO, on behalf of herself and all others similarly situated, Plaintiff-Appellant, v. BRIDGEPORT FINANCIAL, INC.; Ray Lewis; Christina Harbridge, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

523 F.3d 973

Rita CAMACHO, on behalf of herself and all others similarly situated, Plaintiff-Appellant, v. BRIDGEPORT FINANCIAL, INC.; Ray Lewis; Christina Harbridge, Defendants-Appellees.

No. 07-15297.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted March 13, 2008.

Filed April 22, 2008.

Richard M. Pearl, Law Offices of Richard M. Pearl, Berkeley, CA; O. Randolph Bragg, Horwitz, Horwitz & Associates, Chicago, IL; Irving L. Berg, The Berg Law Group, Corte Madera, CA; and Richard J. Rubin, Santa Fe, NM, for the plaintiff-appellant.

Mark E. Ellis and June D. Coleman, Ellis, Coleman, Poirier, La Voie & Steinheimer, LLP, Sacramento, CA, for the defendants-appellees.

Appeal from the United States District Court for the Northern District of California; Charles R. Breyer, District Judge, Presiding. D.C. No. CV-04-00478-CRB/MEJ.

Before: STEPHEN REINHARDT, MELVIN BRUNETTI, and RAYMOND C. FISHER, Circuit Judges.

BRUNETTI, Circuit Judge:

Rita Camacho (Camacho) appeals the district court's order awarding her $77,069.36 in merits fees, costs, and fees-on-fees. The district court determined Camacho's award by multiplying the number of hours worked by each of her three attorneys by an hourly rate of $200, by compensating Camacho for costs, and by awarding Camacho a "flat award" of $500. We have jurisdiction under 28 U.S.C. § 1291, and we vacate and remand.

I. Facts and Proceedings Below

In the underlying action, Camacho, a debtor, sued Bridgeport Financial, Inc. (Bridgeport Financial), a debt collector, in a putative class action alleging violations of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. §§ 1692g, 1692e. Camacho alleged that Bridgeport Financial misrepresented the rights of consumers in its initial collection letter by requiring her to dispute her debt in writing. Bridgeport Financial filed a motion to dismiss, arguing that section 1692g(a)(3) implicitly requires disputes to be made in writing. The district court denied Bridgeport Financial's motion to dismiss, certified the issue for interlocutory appeal, and we affirmed in a published opinion. See 430 F.3d 1078, 1082-83 (9th Cir.2005). We held that the district court correctly denied Bridgeport Financial's motion to dismiss because there is no writing requirement implicit in section 1692g(a)(3), and that Bridgeport Financial violated that section insofar as it stated that disputes must be made in writing. Id. at 1082.

On remand, the litigation focused on class certification, Bridgeport Financial's net worth, and the class remedy. After the district court approved a statewide class, consisting of more than 7,000 members, the parties settled. Pursuant to the parties' Class Action Settlement Agreement, the court ordered Bridgeport Financial to pay a cy pres award of $341.50 to Legal Services of Northern California for use in consumer education or representation, and $1,000 in actual and statutory damages to Camacho. Bridgeport Financial also agreed to pay reasonable and necessary attorneys' fees and costs, to be determined by the court absent an agreement by the parties. The parties did not reach an agreement and Camacho filed her Motion for an Award of Costs and Attorney Fees.

During the course of this litigation, three attorneys represented Camacho, Irving L. Berg (Berg), O. Randolph Bragg (Bragg), and Richard J. Rubin (Rubin). Berg and Bragg represented Camacho during proceedings in the district court, and Camacho retained Rubin to handle the interlocutory appeal.

In her motion, Camacho sought to recover fees and costs totaling $167,434.36. This total included $56,142.50 (132.1 hours x $425/hour) in fees and $192.41 in costs for Berg; $72,772.50 (156.5 hours x $465/hour) in fees and $5,823.71 in costs for Bragg; $1,495.00 (13 hours x $115/hour) in fees for Bragg's law clerk/associate; $115.00 (1 hour x $115/hour) for the services of Bragg's paralegal; and $30,100.00 (60.2 hours x $500/hour) in fees and $793.24 in costs for Rubin. Included in the attorneys' requests were hours spent pursuing fees. Berg, Bragg, and Rubin each provided a declaration supporting their respective fee/costs requests, and Camacho also filed declarations from two additional attorneys in support of her motion. Bridgeport Financial filed an opposition to Camacho's motion which included numerous exhibits and declarations from two more attorneys.

Camacho also explained in her motion that her attorneys would submit a supplemental declaration detailing additional time and costs expended. Bragg ultimately did so, filing a supplemental declaration wherein he sought an additional $12,373.00: $7,533.00 (16.2 hours x $465/hour) in fees for his services, and $4,840.00 (24.2 hours x $200/hour) in fees for his law clerk/associate's services. Although Bridgeport Financial objected to portions of Camacho's three attorneys' declarations, and objected to the two additional attorneys' declarations and Bragg's supplemental declaration in their entirety, the district court never ruled on these objections and Bridgeport Financial never requested a ruling.

In its Second Amended Order, the district court noted that Camacho sought to recover $6,809.36 in litigation expenses and $160,625.00 in fees. This total reflects the amount requested in Camacho's initial motion, but does not account for the amount requested in Bragg's supplemental declaration. The court went on to explain that:

Here, the Court is satisfied that the number of hours spent upon this case by [Camacho's] three attorneys ... is reasonable. The attorneys spent their time on motions brought by [Bridgeport Financial] and defending the case against an appeal brought by [Bridgeport Financial]. While the Court acknowledges that [Camacho's] three attorneys were already exceedingly well-versed on the narrow legal question presented in the case, the Court nonetheless finds that the hours spent on the matter were reasonable. The Court holds, however, that it would be unreasonable on the facts of this case to award the full amount requested by these attorneys. Rather than awarding the full hourly rate suggested by [Camacho], the Court finds, in rough accord with numerous other courts that have considered the issue in published and unpublished opinions, that a reasonable rate for fees for an action brought for the violation of a mandatory provision of the FDCPA is $200.00 per hour.

(Footnote omitted.) Therefore, the court awarded Berg $26,420.00 (132.1 hours x $200/hour), Bragg $31,300.00 (156.5 hours x $200/hour), and Rubin $12,040.00 (60.2 hours x $200) in fees. The court also awarded Berg $192.41, Bragg $5,823.71, and Rubin $793.24, their requested costs. The court then held that the fees submitted by Bragg on behalf of his law clerk/associate ($1,495.00) and paralegal ($115.00) were reasonable, but did not account for these amounts in its ultimate award. To this point, the court awarded Camacho $6,809.36 in costs, and $69,760.00 in fees.

Finally, the court found that while Camacho indicated an intent to seek a supplemental award of costs, expenses, and fees, a substantial award of fees-on-fees would be inappropriate in this case. The court explained that:

Here, [Camacho's] counsel regularly represent litigants in FDCPA cases, and they are therefore experienced with the law governing awards of attorneys' fees and the process for recouping them. Indeed, as [Bridgeport Financial] points out, the materials submitted by [Camacho's] attorneys in support of the motion for costs and attorneys' fees in this case are virtually identical to the materials that these attorneys have submitted in other cases.

The court concluded that "[w]here ... the attorneys seeking fees support their motion with materials that are substantially unchanged from those filed by them in numerous other cases ... it would be inappropriate to award fees on fees on an hourly basis," and instead, the court awarded a "flat award" of $500. In the end, the district court awarded Camacho a total of $77,069.36 in fees and costs ($69,760.00 in fees, $6,809.36 in costs, and a $500 "flat award"). Camacho appealed.

II. Standard of Review

"We review the factual determinations underlying an award of attorneys' fees for clear error and the legal premises a district court uses to determine an award de novo." Ferland v. Conrad Credit Corp., 244 F.3d 1145, 1147-48 (9th Cir. 2001) (per curiam) (citations omitted). "If we conclude that the district court applied the proper legal principles and did not clearly err in any factual determination then we review the award of attorneys' fees for an abuse of discretion." Id. at 1148.

III. Discussion

"Generally, litigants in the United States pay their own attorneys' fees, regardless of the outcome of the proceedings." Staton v. Boeing Co., 327 F.3d 938, 965 (9th Cir.2003). However, "[i]n order to encourage private enforcement of the law ... Congress has legislated that in certain cases prevailing parties may recover their attorneys' fees from the opposing side. When a statute provides for such fees, it is termed a `fee shifting' statute." Id. The FDCPA is one such statute, providing that any debt collector who fails to comply with its provisions is liable "in the case of any successful action ... [for] the costs of the action, together with a reasonable attorney's fee as determined by the court." 15 U.S.C. § 1692k(a)(3). The FDCPA's statutory language makes an award of fees mandatory. Tolentino v. Friedman, 46 F.3d 645, 651 (7th Cir.1995). "The reason for mandatory fees is that congress chose a `private attorney general' approach to assume enforcement of the FDCPA." Id.; see also Graziano v. Harrison, 950 F.2d 107, 113 (3d Cir.1991) (noting that the FDCPA "mandates an award of attorney's fees as a means of fulfilling Congress's intent that the Act should be enforced by debtors acting as private attorneys general"). Here, pursuant to the Settlement Agreement, Bridgeport Financial agreed to pay reasonable...