Dowling v. Gen. Motors LLC

• Decision Date: 16 September 2019
• Docket Number: Civil Action No. 15-cv-00445-KLM
• Parties: JAMIE LEE DOWLING, individually, as surviving mother of Landyn Scott Dowling, Plaintiff, SHAWN COOK, Plaintiff-Intervenor, v. GENERAL MOTORS LLC, and KEY SAFETY SYSTEMS, INC., Defendants.
• Court: U.S. District Court — District of Colorado

JAMIE LEE DOWLING, individually,as surviving mother of Landyn Scott Dowling, Plaintiff,SHAWN COOK, Plaintiff-Intervenor, v. GENERAL MOTORS LLC, and KEY SAFETY SYSTEMS, INC., Defendants.

Civil Action No. 15-cv-00445-KLM

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO

September 16, 2019

ORDER

ENTERED BY MAGISTRATE JUDGE KRISTEN L. MIX

This matter is before the Court on Plaintiff-Intervenor's Motion for Attorneys' Fees and Costs Pursuant to Fed. R. Civ. P. 54(d) [#67]¹ (the "Motion"). The Court has reviewed the Motion [#67], Response [#75], Reply [#77], exhibits, the case file, and the applicable law, and is sufficiently advised in the premises. For the reasons set forth below, the Motion [#67] is DENIED.

I. Background

This wrongful death action arises from the tragic deaths of Jamie Lee Dowling's ("Plaintiff") two young children in a car accident that occurred on March 9, 2013. Plaintifffiled the lawsuit in this Court on March 3, 2015, seeking to recover pursuant to the Colorado Wrongful Death Act, Colo. Rev. Stat. § 13-21-201(1)(c). Compl. [#1]. The Complaint [#1] alleges that Plaintiff's car, a 2008 Chevrolet Cobalt, was defective in its design and manufacture, which resulted in loss of control and subsequent failure of the air bags to deploy. The matter was transferred to the Southern District of New York on March 16, 2015, see [#6], and thereafter was remanded to this Court on March 10, 2017, largely for purposes of approval and distribution of settlement proceeds. See [#8-2]. On April 27, 2017, all settlement proceeds with respect to Plaintiff's daughter, Raylee Kay Dowling ("Raylee"), were allocated to Plaintiff by the Court. Minute Order [#17].

On August 10, 2017, Plaintiff filed a Motion to Allocate Settlement Proceeds [#19] (the "Motion to Allocate") with respect to her son, Landyn Scott Dowling. Plaintiff-Intervenor Shawn Willis Cook ("Cook"), who is Landyn's biological father, was permitted to intervene in this case on November 3, 2017. He thereafter filed a Response [#26] and Exhibits [#27] seeking 50% of the settlement proceeds. The Court scheduled an evidentiary hearing, which was held on January 9-10, 2018. See [#49, #50]. On March 30, 2018, the Court issued a Final Order and Judgment [#58] (the "Final Order") that allocated sixty-five percent of the gross settlement proceeds to Plaintiff Dowling, and thirty-five percent of the gross settlement proceeds to Plaintiff-Intervenor Cook. The Court explicitly denied Plaintiff's request that the Court allocate the settlement proceeds after deduction for Plaintiff's attorneys' fees and costs. Final Order [#58] at 13-14. Pursuant to Fed. R. Civ. P. 58(a) and the Final Order, the Clerk of the Court issued the Final Judgment [#59] which entered final judgment in favor of Plaintiff and Plaintiff-Intervenor against Defendants and ordered that Plaintiff and Plaintiff-Intervenor file bills of costs within 14 days of entry of the judgment.²

On May 4, 2018, Mr. Cook filed the instant Motion [#67] seeking attorneys' fees and costs pursuant to C.R.S. § 13-17-102 and Federal Rule of Civil Procedure 54(d) ("Rule 54(d)"). Mr. Cook avers that he is entitled to these fees and costs because Plaintiff's Motion to Allocate [#19] was "substantially groundless and substantially vexatious, [and] because at least 30 factual allegations contained in Ms. Dowling's Declaration were false, misleading, exaggerated, unsupported by any admissible evidence, or substantially or overwhelmingly refuted by evidence presented at the evidentiary hearing." Motion [#67] at 2-3. As such, Mr. Cook seeks "his attorneys' fees incurred in litigating against Ms. Dowling's and her counsel's substantially vexatious motion, in the total amount of $42,866.60."³ Id. at 25. In support of the Motion, Mr. Cook provides the Court with a transcript of the evidentiary hearing, exhibits admitted into evidence at the hearing, and affidavits pursuant to D.C.COLO.LCivR 54.3 with attachments. Pl.-Intervenor's Exs. A-C [#67-1 through #67-28].

II. Analysis

The Court's "'basic point of reference' when considering the award of attorney's fees is the bedrock principle known as the 'American Rule': Each litigant pays his [or her] own attorney's fees, win or lose, unless a statute or contract provides otherwise." Kazazian v. Emergency Serv. Physicians, P.C., 300 F.R.D. 672, 675 (D. Colo. 2014) (internal quotations omitted, citing Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242, 252-53 (2010)). Mr. Cook moves for his attorneys' fees and costs incurred in intervening in this action and responding to Plaintiff's Motion to Allocate [#19] pursuant to C.R.S. § 13-17-102 and Rule 54(d). The Court addresses Mr. Cook's request under each theory in turn.

A. C.R.S. § 13-17-102

Mr. Cook first seeks attorneys' fees pursuant to a Colorado statute that provides:

[I]n any civil action of any nature commenced or appealed in any court of record in this state . . . [t]he court shall assess attorney fees if . . . it finds that an attorney or party brought or defended an action, or any part thereof, that lacked substantial justification or that the action, or any part thereof, was interposed for delay or harassment or if it finds that an attorney or party unnecessarily expanded the proceeding by other improper conduct . . . As used in this article, "lacked substantial justification" means substantially frivolous, substantially groundless, or substantially vexatious.

C.R.S. § 13-17-102(2), (4).⁴ Mr. Cook argues that Plaintiff's Motion to Allocate [#19] was substantially groundless and vexatious as demonstrated by Plaintiff's allegations which were, according to Mr. Cook, "false, misleading, exaggerated, unsupported by anyadmissible evidence, or substantially or overwhelmingly refuted by evidence presented at the evidentiary hearing." Motion [#67] at 5.

In response, Plaintiff asserts the threshold argument that Mr. Cook is precluded from seeking attorneys' fees pursuant to C.R.S. § 13-17-102 because the Colorado statute is preempted by Federal Rule of Civil Procedure 11 ("Rule 11"), with which Mr. Cook failed to comply. Response [#75] at 2-6. Plaintiff correctly notes that this District has consistently found that Rule 11's safe-harbor provision⁵ preempts C.R.S. § 13-17-102 and that therefore, failure to comply with the safe-harbor provision bars a motion for attorney's fees pursuant to C.R.S. § 13-17-102. Response [#75] at 3; see, e.g., Hanover Ins. Grp. v. iCarpets, Inc., No. 16-cv-01013-RBJ, 2017 WL 6524657, at *6-7 (D. Colo. Dec. 21, 2017); Hach Co. v. In-Situ, Inc., No. 13-cv-02201-CBS, 2016 WL 9725765, at *10-11 (D. Colo. Nov. 22, 2016); DeJean v. Grosz, No. 13-cv-02381-NYW-MJW, 2015 WL 4504932, at *3 (D. Colo. July 24, 2015); Christou v. Beatport, LLC, No. 10-cv-02912-RBJ-KMT, 2014 WL 1293296, at *3 n.1 (D. Colo. Mar. 31, 2014); Kazazian, 300 F.R.D. at 676-78; Spratt v. Leinster, No. 06-cv-01526-WDM-KLM, 2007 WL 2412826, at *1 (D. Colo. Aug. 21, 2007); McCoy v. West, 965 F. Supp. 34, 35-36 (D. Colo. 1997); In re Johnson, 485 B.R. 642, 649 (Bankr. D. Colo. 2013). Cf., Diebold Enters. Sec. Sys., Inc.v. Low Voltage Wiring, Ltd., No. 13-cv-00505-REB-KLM, 2014 WL 1491327 (D. Colo. Apr. 14, 2014) (noting Johnson, 485 B.R. 642, had found the statute preempted, the court found that even assuming the statute was applicable, the request for attorneys' fees failed on other grounds).

Applying an Erie analysis, these courts have reasoned that C.R.S. § 13-17-102 "is merely a procedural statute regarding sanctions based on conduct in the litigation" and not substantive law under Erie. Hach Co., 2016 WL 9725765, at Thus, this District has repeatedly held "that, 'to the extent Colo. Rev. Stat § 13-17-101 et seq. is inconsistent with the procedural safe-harbor provisions of Rule 11, it is preempted.'" DeJean, 2015 WL 4504932, at *3 (quoting Spratt, 2007 WL 2412826, at *1; citing Kazazian, 300 F.R.D. at 676-77; Martinson v. Professional Bureau of Collections of Maryland, Inc., No. 09-cv-02145-MSK-BNB, 2010 WL 3777282, at *3 (D. Colo. Sept. 21, 2010)); see also Hach Co., 2016 WL 9725765, at *11 ("Because the statute is procedural, the District of Colorado consistently holds § 13-17-102 preempted by Rule 11's safe-harbor provision." (collecting cases)).

Mr. Cook does not address this issue in his Motion [#67] and nowhere contends that he has complied with Rule 11's safe-harbor provision. Instead, Mr. Cook argues in his Reply that C.R.S. § 13-17-102 "is treated as substantive law under Tenth Circuit precedent [and] therefore, [ ] is not preempted by Rule 11." [#77] at 5. Mr. Cook further argues that the decisions finding C.R.S. § 13-17-102 preempted by Rule 11 under Erie are inapplicable to the present case because they were issued by courts sitting in federal question jurisdiction, not diversity. Id. at 6.

As an initial matter, "'the Erie doctrine applies, whatever the ground for federal jurisdiction, to any issue or claim which has its source in state law.'" Johnson, 485 B.R. at 645 (quoting Maternally Yours, Inc. v. Your Maternity Shop, Inc., 234 F.2d 538, 541 n.1 (2d Cir. 1956)). Thus, although Mr. Cook is correct in that federal courts sitting in diversity jurisdiction must apply the substantive law of the forum state, the Court fails to see how analyzing C.R.S. § 13-17-102 under Erie would differ whether the Court's jurisdiction is based on diversity of citizenship or federal question. See also Hach Co., 2016 WL 9725765, at *11 ("In cases involving state law claims, the court applies the substantive law of the forum state but federal procedural law.") (citations omitted).

"[T]he 'first analytical step' in an Erie case 'is to determine whether [a state] statute collides with any federal procedural rule.'" Scottsdale Ins. Co. v. Tolliver, 636 F.3d 1273, 1276-77 (10th Cir. 2011) (quoting Trierweiler v. Croxton & Trench Holding Corp., 90 F.3d 1523, 1539 (10th Cir. 1996)) (brackets in original). "The question is not whether the federal and...