Evans v. D. Cefalu Mgmt., Inc., CASE NO. 16-60613-CIV-ZLOCH
| Decision Date | 25 September 2018 |
| Docket Number | CASE NO. 16-60613-CIV-ZLOCH |
| Citation | 334 F.Supp.3d 1277 |
| Parties | Troy EVANS, Plaintiff, v. D. CEFALU MANAGEMENT, INC., and Christine Difiore Kirsch, Defendants. |
| Court | U.S. District Court — Southern District of Florida |
Brian Jay Militzok, Militzok Law, P.A., Hollywood, FL, for Plaintiff.
Chris Kleppin, Glasser & Kleppin, P.A., Plantation, FL, for Defendants.
WILLIAM J. ZLOCH Sr., United States District JudgeTHIS MATTER is before the Court upon Defendants' Memorandum In Support Of The Defendants' Award For Attorneys' Fees And Costs Associated With Plaintiff's Non-Appearance At His Deposition (DE 29), Motion For Bill Of Costs (DE 66), and Verified Motion For Attorney's Fees Against Plaintiff's Counsel And His Law Firm (DE 68). The Court has carefully reviewed said Motions, the entire court file and is otherwise fully advised in the premises.
As the Court explained in its prior Order (DE 64), granting Defendants' Motion For Summary Judgment (DE 26), Plaintiff Troy Evans (hereinafter "Plaintiff") in the above-styled cause brought only one claim against Defendants D. Cefalu Management, Inc., and Christine Difiore Kirsch (hereinafter "Defendants") for failure to pay overtime compensation in accord with the Fair Labor Standards Act, 29 U.S.C. § 201, et seq. (hereinafter "the FLSA"). The Court granted summary judgment for Defendants because Plaintiff failed to contest by either a response to Defendants' Statement Of Undisputed Material Facts In Support Of Their Motion For Summary Judgment (DE 27), or even by any argument within his Response (DE 43) that Plaintiff was in fact paid all overtime compensation he was owed, regardless of whether Defendants were actually covered by the FLSA. Defendants maintained that they are not covered by the FLSA because they allege their income does not meet the statutory requirements. Plaintiff has at all times in the case contested that argument. See, e.g. DE 43. But, as Plaintiff did not contest Defendants' facts, supported by their own records, that overtime was paid, the Court did not find it necessary to resolve the coverage issue.
Defendants now maintain that they should be awarded attorney's fees and costs. Pursuant to 29 U.S.C. § 216(b), the Court is required to award attorney's fees only to a prevailing plaintiff in an FLSA case: "The court in such action shall, in addition to any judgment awarded to the plaintiff or plaintiffs, allow a reasonable attorney's fee to be paid by the defendant, and costs of the action." The statute is silent as to a prevailing defendant's entitlement to attorney's fees. Thus, the Eleventh Circuit in Kreager v. Solomon & Flanagan, P.A. held that the FLSA makes an attorney's fee award mandatory only for prevailing plaintiffs, in accordance with the ‘American Rule.’ 775 F.2d 1541, 1542-43 (11th Cir. 1985) (citing Alyeska Pipeline Service Co. v. Wilderness Society, 421 U.S. 240, 95 S.Ct. 1612, 44 L.Ed.2d 141 (1975) ; Christiansburg Garment Co. v. EEOC, 434 U.S. 412, 416 & n.5, 98 S.Ct. 694, 54 L.Ed.2d 648 (1978) ). In that case, the court explained that an exception to this rule would be bad faith, and Id. at 1543 (citations omitted). See also Barnes v. Dalton, 158 F.3d 1212, 1214 (11th Cir. 1998) ("The key to unlocking a court's inherent power is a finding of bad faith." (citing In re Mroz, 65 F.3d 1567, 1575 (11th Cir. 1995) ). Courts within this Circuit have correctly observed that, "Bad faith is a stringent standard that makes it difficult for a defendant to prevail." Ellis v. All My Sons Moving & Storage of Orlando, Inc., No. 6:07-CV-2017-ORL-19DAB, 2009 WL 2496626, at *2 (M.D. Fla. Aug. 12, 2009) (citing Murray v. Playmaker Serv., LLC, 548 F.Supp.2d 1378, 1382 (S.D. Fla. 2008) ).
Defendants suggest that the appropriate basis for sanctions is the Court's inherent power. In a seminal case on the Court's authority to award sanctions pursuant to this inherent authority, Chambers v. NASCO, Inc., the Supreme Court affirmed this basis as an appropriate source of power for fee-shifting attorney's fees, even in situations in which, absent the extraordinary circumstance of bad faith, the ‘American Rule’ would apply. 501 U.S. 32, 45, 111 S.Ct. 2123, 115 L.Ed.2d 27 (1991). The Court also cautioned that, "Because of their very potency, inherent powers must be exercised with restraint and discretion." Id. at 44, 111 S.Ct. 2123 (citing Roadway Express, Inc. v. Piper, 447 U.S. 752, 764, 100 S.Ct. 2455, 65 L.Ed.2d 488 (1980) ). The Court has already discussed the fact that it must find bad faith in order to award such sanctions. This is one of methods by which the Court exercises great caution, as required. See Thomas v. Tenneco Packaging, Co., 293 F.3d 1306, 1320 (11th Cir. 2002) (citing Durrett v. Jenkins Brickyard, Inc., 678 F.2d 911, 918 (11th Cir. 1982) ). In addition to finding bad faith, the Court must afford the party against whom sanctions are considered due process, which means in this case, "the lawyer facing sanctions must be provided with notice and ‘an opportunity to respond, orally or in writing, to the invocation of such sanctions and to justify his actions.’ " Id. at 1321 (quoting In re Mroz, 65 F.3d 1567, 1575-76 (11th Cir. 1995) ). As to this notice, it is acceptable that it comes from the court, from the party who seeks the sanctions, or from both. In re Mroz, 65 F.3d at 1575-76. Plaintiff had notice from the Court when the Court stated in the Final Judgment (DE 65) that it would entertain a Motion For Attorney's fees, and then also from Defendants, obviously, in the instant Motion (DE 68). However, in an abundance of caution, the Court recognizes that the precise basis for any award of fees was not stated. The Court states here unequivocally that the only basis the Court is considering for awarding fees against Plaintiff's counsel only, and not Plaintiff, is the Court's inherent power.
Thus, the Court will give Plaintiff's counsel one final chance to offer an explanation, specifically, of why he continues to maintain that he had an argument for the fact that Plaintiff was not paid all of his overtime wages. The Court cautions Plaintiff's counsel that the Court expects this explanation to be contained entirely within, or at the very least, supported by, an affidavit from Plaintiff's counsel. The Court understands that there is some uncertainty as to whether Plaintiff can be reached, or even wishes to be reached, by Plaintiff's counsel. But, this is immaterial at this point. The above-styled cause has been resolved in Defendants' favor. The Court is merely giving Plaintiff's counsel an opportunity to proffer a full and thorough statement about his investigation of Plaintiff's claim and his reasons for believing it was supported by evidence, despite the fact that he failed to marshal this evidence against Defendants' Motion For Summary Judgment (DE 26).
By the instant Motion (DE 68), Defendants argue that this case is an instance of bad faith and that the Court should award fees based on its inherent authority, which they acknowledge is even more limited than Federal Rule of Civil Procedure 11 or 28 U.S.C. § 1927. Defendants concede that they did not file a Rule 11 motion, but note that they did serve such a motion on Plaintiff before ultimately deciding against filing. Defendants assert that the case was frivolous and that this contention is established because Plaintiff has not provided evidence, at summary judgment, or at any other time, that he was not paid all overtime owed.
Plaintiff's Response (DE 71) to Defendants' Motion (DE 68) is, frankly, baffling, and not helpful to the Court in determining whether Plaintiff's claim had any basis. Plaintiff's counsel explains that his failure to respond to Defendants arguments about Plaintiff not being owed overtime was "inadvertent error." DE 71, p. 2. After the Court entered its Order (DE 64), granting summary judgment, Plaintiff's counsel explains that he attempted to contact Plaintiff in order to file a sworn statement along with a motion for reconsideration. Such a motion was never filed, as he admits. The Court previously remarked, in its Order (DE 64), that there was a discrepancy between Plaintiff's failure to controvert Defendants' facts and legal argument and a statement in the Parties' Joint Pretrial Stipulation (DE 54) that the hours Plaintiff worked and whether he was paid in accordance with the FLSA were issues which remained for proof at trial. See DE 65, p. 2, n.2. The Court gathers from Plaintiff's Response (DE 71) that, despite Plaintiff's counsel's conduct in the above-styled cause, Plaintiff's counsel continues to believe that Plaintiff was, in fact, not paid his overtime under the FLSA. The appropriate time to present this evidence has long since passed. All of the evidence before the Court supports Defendants, as the Court noted when it granted summary judgment in their favor. DE 64.
But, while the Court wishes to make it abundantly clear that any explanation offered at this date will not affect the Final Judgment (DE 65) entered against Plaintiff, the Court must be fully appraised of Plaintiff's argument before deciding whether or not the above-styled cause was either brought in bad faith, or at any point continued to be litigated in bad faith. And, the Court would not wish in any way to be seen as not affording Plaintiff's counsel all possible due process to fully defend his own actions. The Court would observe that two aspects of the pleadings before the Court at this time have influenced this decision. First, the primary thrust of Plaintiff's Response (DE 71) is that Plaintiff's counsel failed due to inadvertence. Inadvertence alone is not bad faith, but the Court needs reasons to understand why the Court should accept this explanation. Second, repeatedly, in its Reply (DE 74), Defendants state that...
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