Fabri v. United Techs. Int'L., Inc.

• Decision Date: 29 March 2002
• Docket Number: No. CIV. 3:96CV2358(PCD).,CIV. 3:96CV2358(PCD).
• Court: U.S. District Court — District of Connecticut
• Parties: Juan FABRI, Sr., et al., Plaintiffs, v. UNITED TECHS. INT'L, INC. et al., Defendants.

Page 480

193 F.Supp.2d 480

Juan FABRI, Sr., et al., Plaintiffs, v. UNITED TECHS. INT'L, INC. et al., Defendants.

No. CIV. 3:96CV2358(PCD).

United States District Court, D. Connecticut.

March 29, 2002.

Edward T. Krumeich, Miles F. McDonald, Jr., Deirdre A. Martini, Deborah A. Kelly, Ivey, Barnum & O'Mara, Greenwich, CT, Al Van Kampen, Van Kampen & Associates, Seattle, WA, Bruce G. MacIntyre, William D. Fisher, Perkins & Coie, Seattle, WA, William Ivar Haslun, II, Greenwich, CT, for Juan F. Fabri, Sr., Juan F. Fabri, Jr., plaintiffs.

Craig A. Raabe, Steven R. Humphrey, Bradford S. Babbitt, Marion B. Manzo, Robinson & Cole, Hartford, CT, for United Tech Intl, United Technologies Corp., Sikorsky Aircraft Div United Tech Corp, defendants.

RULING ON PLAINTIFFS' MOTION FOR ATTORNEYS' FEES

DORSEY, Senior District Judge.

Plaintiffs move for attorneys' fees under the Connecticut Unfair Trade Practices Act ("CUTPA"). The motion is denied without prejudice.

I. BACKGROUND

A. Factual Background

Plaintiffs, Juan F. Fabri, Sr. and Juan F. Fabri, Jr. (collectively, "Fabris"), are Argentine citizens. Pursuant to written agreements (the "SRA"), they served as sales representative for divisions and subsidiaries of United Technologies Corporation, including United Technologies International and Sikorsky Aircraft Corporation (collectively, "Defendants"). As part of the SRA, the Fabris warranted compliance with the Foreign Corrupt Practices Act ("FCPA"), 15 U.S.C. §§ 78dd-1 et seq.

Based on the report of a bribe solicitation and statements related thereto by Mr. Fabri, Jr., Defendants engaged O. Thomas Johnson, an expert in foreign corruption investigations, to investigate whether there was any commitment to make an improper payment to an Argentine official in connection with a helicopter sale by Sikorsky. Mr. Johnson concluded that there were a number of "red flags" or signals of such a commitment that could violate the FCPA. The SRA permitted Defendants to terminate the Fabris if they had a "reason to believe" that the Fabris had violated contractual representations and warranties, in which they undertook not to make or promise any corrupt payments. Mr. Johnson recommended that Defendants terminate the Fabris, which was subsequently done. The Fabris were terminated and were not paid commissions, Defendants having concluded that such could result in FCPA violations.

B. Procedural History

The Fabris brought suit on November 21, 1996. Ivey, Barnum & O'Mara ("IB & O") appeared as local counsel. Bogle & Gates ("B & G"), original lead counsel, dissolved and withdrew its representation; IB & O continued with assistance from Attorney Al Van Kampen.

After five years of litigation and a five-week trial, the jury found for Defendants on all counts except a CUTPA claim,¹ on which the jury awarded the Fabris $1 nominal damages and $500,000 punitive damages.² Defendants' motion for judgment as a matter of law was denied. The Fabris now move for $1,583,002.26 in attorneys' fees pursuant to CONN. GEN. STAT. § 42-110g(d).

II. DISCUSSION

A. The Fabris' Entitlement to Attorneys' Fees

Defendants first argue that the Fabris are not entitled to an award of attorneys' fees, as the jury rejected all claims except one, on which they received no compensatory damages. The argument is without merit.

Defendants' argument rests on the Supreme Court cases of Farrar v. Hobby, 506 U.S. 103, 113 S.Ct. 566, 121 L.Ed.2d 494 (1992) and Hensley v. Eckerhart, 461 U.S. 424, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983). These cases were decided under 42 U.S.C. § 1988.³ The Fabris prevailed under CUTPA. As was held in denying Defendants' motion for judgment as a matter of law, "[t]his case is a state law case as to fees." Accordingly, this court looks in the first instance to the CUTPA statute, not to § 1988, in determining the propriety of an award of attorneys' fees. Defendants' attempt to link case law interpreting § 1988 to CUTPA is unconvincing,⁴ particularly in the face of contrary CUTPA case law.⁵

Moreover, the Supreme Court case law to which Defendants cite, Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep't of Health & Human Res., 532 U.S. 598, 604 n. 6, 121 S.Ct. 1835, 149 L.Ed.2d 855 (2001) ("in some circumstances [a party who receives only nominal damages] should still not receive an award of attorney's fees"); Farrar, 506 U.S. at 115, 113 S.Ct. 566, does not stand for the proposition that courts must not award attorneys' fees to a plaintiff who has won only nominal damages. Rather, they stand for the proposition that, under § 1988, trial courts may decline to award attorneys' fees to a plaintiff who has won only nominal damages. Even if the statutory foundation for those cases were the same as the present case, not awarding any fee would be inappropriate in this case.

Defendants' argument ignores the punitive damages that the Fabris claimed, proved, and won. Such a result is more than technical or nominal. Accordingly, an award of reasonable fees is found to be appropriate. The argument that the punitive damages verdict cannot sustain an attorneys' fee award as such verdict is contrary to the CUTPA statute fails as the latter premise was rejected in the ruling on Defendants' motion for judgment as a matter of law.

Lastly, CUTPA provides that awards are to be "based on the work reasonably performed by an attorney and not on the amount of recovery." CONN. GEN. STAT. § 42-110g(d). Even if this court were to look only to the $1 in nominal damages, to award no fee would be contrary to the express language that attorneys' fees not be based "on the amount of recovery." A plaintiff may recover attorneys' fees in a CUTPA case even when awarded no compensatory damages. Jacques All Trades Corp. v. Brown, 57 Conn.App. 189, 197-98, 752 A.2d 1098 (App.2000).

B. Contingent Fee Agreement

The Fabris entered into a contingent fee agreement with IB & O which entitled the lawyers to 35% of the Fabris' total recovery, where the total recovery includes any award for attorneys' fees.⁶ Defendants argue that any award of attorneys' fees should be capped by the amount the Fabris agreed to pay their counsel.⁷ The argument is without merit. A CUTPA fee award is not capped by a contingent fee agreement.

1. The text of the CUTPA statute

Capping an award by a contingent fee agreement is contrary to the explicit text of CUTPA. When a "trial court ignores the plain meaning of the words contained" in a statute, it "violates a basic tenet of statutory construction." Thibeault v. White, 168 Conn. 112, 115, 358 A.2d 358 (1975); see also IBM Corp. v. Brown, 167 Conn. 123, 134, 355 A.2d 236 (1974) ("The statute must be applied as its words direct."). CUTPA reads, "[T]he court may award, to the plaintiff, in addition to the relief provided in this section, costs and reasonable attorneys' fees based on the work reasonably performed by an attorney and not on the amount of recovery." CONN. GEN. STAT. § 42-110g(d). The statute instructs on what such an award must be based and on what it must not be based. The argument flies in the face of both.

CUTPA instructs a trial court to base an award "on the work reasonably performed by an attorney." A trial court must assess the attorney's reasonable work on behalf of his or her client. The statute does not relate an award to a contingent fee agreement nor is such even obliquely mentioned. Moreover, the statute specifically directs that an award not be based on "the amount of recovery." The contingent fee in this case is a percentage of the total award. A fee award capped by a contingent fee agreement would be capped by, and thus based on, the amount of recovery. Defendants' argument would do what the statute expressly precludes, namely, to base a CUTPA award on the amount of recovery, rather than the reasonable work performed by an attorney. As contrary to CUTPA, Defendants' argument is without merit.

2. The Connecticut Supreme Court case of Sorrentino

In support of their argument, Defendants cite Sorrentino v. All Seasons Services, Inc., 245 Conn. 756, 717 A.2d 150 (1998), which held that "[a] trial court should not depart from a reasonable fee agreement in the absence of a persuasive demonstration that enforcing the agreement would result in substantial unfairness to the defendant." Id. at 776, 717 A.2d 150. The holding is not on point.

Sorrentino presented the question of whether a contingent fee agreement should be a floor to a reasonable fee award under the Connecticut Workers' Compensation Act ("WCA"). See id. at 758, 773, 717 A.2d 150. The trial court had held that the reasonable award for the plaintiff's attorney was less than the amount provided in a contingent fee agreement. Id. at 774, 717 A.2d 150. The trial court gave two reasons: that the original amount included work by non-attorneys and that the original amount included separate billing for two lawyers for work performed simultaneously. Id. The plaintiff appealed for the full amount of fees under the contingent fee agreement. Id. at 773, 717 A.2d 150. The Connecticut Supreme Court reversed the trial court, holding that its two reasons for reducing the fee award were not sufficient. Id. at 776-77, 717 A.2d 150. It went on to hold that the award should be raised to the amount of the contingent fee. Id.

Sorrentino does not control here. As a preliminary matter, the two errors on which the reversal of the trial court were based are not argued in the present case.

Moreover, Sorrentino dealt with a different statute. There, the plaintiff sued under the WCA, CONN. GEN. STAT. § 31-275 et seq., for retaliatory discharge. Sorrentino, 245 Conn. at 758, 717 A.2d 150. After prevailing at a jury trial, he sought attorneys' fees under CONN. GEN. STAT. § 31-290a(b)(1). Id. at 773-74, 717 A.2d 150. The Fabris seek fees under CUTPA. The two fee statutes are materially different. The WCA fee statute provides that "[a]ny employee who prevails in such a civil action shall be awarded...