Greenway v. Southern Indana Gas & Elec. Co.

• Court: U.S. District Court — Southern District of Indiana
• Writing for the Court: SARAH EVANS BARKER
• Decision Date: 23 February 2012
• Docket Number: 3:07-cv-66-SEB-WGH
• Citation: Greenway v. Southern Indana Gas & Elec. Co., 3:07-cv-66-SEB-WGH (S.D. Ind. Feb 23, 2012)
• Parties: EVANSVILLE GREENWAY AND REMEDIATION TRUST, a Qualified Settlement Trust, Plaintiff, v. SOUTHERN INDIANA GAS AND ELECTRIC COMPANY, INC., an Indiana Corporation; et al., Defendants. EVANSVILLE GREENWAY PRP GROUP, Third-Party Plaintiff, v. GENERAL WASTE PRODUCTS, et al., Third-Party Defendants.

EVANSVILLE GREENWAY AND REMEDIATION TRUST, a Qualified Settlement Trust, Plaintiff, v. SOUTHERN INDIANA GAS AND ELECTRIC COMPANY, INC., an Indiana Corporation; et al., Defendants.

EVANSVILLE GREENWAY PRP GROUP, Third-Party Plaintiff, v. GENERAL WASTE PRODUCTS, et al., Third-Party Defendants.

3:07-cv-66-SEB-WGH

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF INDIANA EVANSVILLE DIVISION

Dated: February 23, 2012

ENTRY ON THIRD-PARTY DEFENDANT SOLAR SOURCES'S MOTION

TO DETERMINE THE AMOUNT OF ATTORNEY FEES AND COSTS

This matter is before the Court on Third-Party Defendant Solar Sources's Motion to Determine the Amount of Attorney Fees and Costs filed March 28, 2011. (Docket Nos. 918-20).

On February 25, 2011, the Court entered its Order Granting Third-Party Defendant Solar Sources's Motion for Summary Judgment. Third-Party Plaintiff, the Evansville Greenway PRP Group ("PRP Group"), had filed suit against Third-Party Defendant Solar Sources pursuant to the Comprehensive Environmental Response, Compensation andLiability Act (CERCLA), 42 U.S.C. § 9601 et seq., for the recovery of cleanup costs of two allegedly contaminated sites. However, as the Court concluded, the Superfund Recycling Equity Act (SREA), 42 U.S.C. § 9627 (an amendment to CERCLA), exempts certain recyclers from CERCLA clean-up liability, and awards costs and fees to recyclers who are forced to defend against improper contribution actions.¹ The Court determined that Solar Sources was such a recycler and awarded "Solar Sources ... all reasonable fees and costs which it incurred in defending this action . . . ."

Solar Sources filed the motion at issue here seeking a total of $425,027.73 in attorney fees and costs.² The PRP Group objects to an award of attorney fees arguing that: (1) Solar Sources is not entitled to any attorney fees because the Court was wrong when it ruled that SREA applied to Solar Sources; (2) the fact that Solar Sources paid its attorney bills is not sufficient evidence that those fees were reasonable; (3) Solar Sources cannot recover any fees prior to April 7, 2009, because prior to that date Solar Sources had not yet raised a defense under SREA; (4) Solar Sources's "fees to recover fees" are unreasonable; (5) Solar Sources has failed to demonstrate that the redacted entries in its fee request are reasonable; (6) the fees incurred by Solar Sources after it switched to a contingency feeagreement are unreasonable; and 7) Solar Sources cannot recover any fees associated with work performed in defense of the PRP Group's state-law claims.

Having reviewed the parties' briefs and the relevant legal authorities, the Court now finds as follows:

1. The Court will not revisit its Order Granting Third-Party Defendant Solar Sources's Motion for Summary Judgment.

The PRP Group first argues that the Court should decline to award any attorney fees to Solar Sources because Solar Sources is not entitled to attorney fees under the SREA. Essentially, the PRP Group seeks to have the Court reconsider its Order Granting Third-Party Defendant Solar Sources's Motion for Summary Judgment. However, Rule 59(e) of the Federal Rules of Civil Procedure makes the PRP Group's motion untimely, as it was not filed within 28 days of the Court's ruling granting summary judgment. Furthermore, Rule 7.1 of the Local Rules of our court directs that "[a] new motion must not be incorporated within a brief, response, or reply to a previously filed motion." Therefore, if the PRP Group had intended to file a motion to reconsider, it was required to file a separate motion, which it did not do.

2. Payment of attorney bills can be evidence of reasonableness.

The PRP Group next contends that, in this instance, Solar Sources's payment of attorney fees is not sufficient evidence to prove the reasonableness of those fees. In all cases, the party seeking an award of attorney fees bears the burden of proving the reasonableness of the fees. Spegon v. Catholic Bishop, 175 F.3d 544, 550 (7th Cir. 1999)(citation omitted). In cases where the entitlement to an award of attorney's fees isgoverned by statute, calculation of an award of attorney fees begins with a "lodestar" determination, which is calculated by multiplying the number of hours the attorney reasonably expended on the litigation times a reasonable hourly rate. Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1982); Johnson v. GDF, Inc., __ F.3d __, 2010 WL 456484, at *1 (7th Cir. Feb. 13, 2012). The court then adjusts the lodestar amount to reflect various factors including the complexity of the legal issues involved, the degree of success obtained, and the public interest advanced by the litigation. Schlacher v. Law Offices of Phillip J. Rotche & Assoc., P.C., 574 F.3d 852, 856-57 (7th Cir. 2009). "The district court must provide a clear and concise explanation for its award, and may not 'eyeball' and decrease the fee by an arbitrary percentage because of a visceral reaction that the request is excessive." Id. at 857.

However, courts within the Seventh Circuit have routinely found that "the best evidence of whether attorney's fees are reasonable is whether a party has paid them." Cintas Corp. v. Perry, 517 F.3d 459, 469 (7th Cir. 2008); see also Loparex, LLC v. MPI Release Tech., LLC, 2011 WL 2066666 at *1 (S.D. Ind. 2011). "If attorneys submit bills that meet market standards of detail, their omission of information to which courts resort in the absence of agreement is of no moment. If the bills were paid, this strongly implies that they meet market standards." Medcom Holding Co. v. Baxter Travenol Laboratories, Inc., 200 F.3d 518, 520 (7th Cir. 1999).

In this case, the evidence demonstrates that Solar Sources paid all of its attorney fees up to February 28, 2010. We find that convincing proof of their reasonableness.

3. Solar Sources is entitled to all reasonable costs of defending this action.

The PRP Group argues that Solar Sources is not entitled to recover any attorney fees incurred prior to April 7, 2009, because prior to that date Solar Sources had not yet raised a defense under the SREA. However, the SREA clearly indicates that, when one party brings suit for recovery costs and a court ultimately determines that the allegedly offending party is not liable because they qualify as a recycler under the SREA, then the absolved party is entitled to "all reasonable costs of defending that action." In this instance, the Court concluded that there was no evidence to support the PRP Group's decision to commence an action in contribution against Solar Sources. The Court thus determined that the protections afforded certain recyclers by SREA applied to Solar Sources. Consequently, we hold that Solar Sources is entitled to recover all of the reasonable costs it has incurred in defending this action. The fact that Solar Sources did not immediately raise the SREA as a defense is of no consequence here.

4. Fees to recover fees may be available, if otherwise reasonable.

Next, the PRP Group notes that it filed a motion to voluntarily dismiss all claims against Solar Sources on September 17, 2010. The PRP Group argues that all of the work that counsel for Solar Sources put into this case after that date was thus performed only to gain Solar Sources a larger fee award. However, that argument plainly is not the case. The PRP Group's motion sought to voluntarily dismiss all claims against Solar Sources without prejudice. At the time of the PRP Group's motion, there was already a pending, fully-briefed motion for summary judgment which, if resolved in Solar Sources favor, would dispose of all claims against Solar Sources on the merits and with prejudice. Consequently,the work that Solar Sources's counsel performed after the PRP Group filed its Motion for Voluntary Dismissal of Claims Against Solar Sources was not work performed merely to obtain a fee award. Solar Sources, by opposing the PRP Group's Motion for Voluntary Dismissal, was obviously attempting to permanently rid itself of any chance of having to re-litigate this case sometime in the future. Therefore, while the Court must still analyze the reasonableness of the fee request submitted by Solar Sources, we find no grounds on which to reject as unreasonable all of the fees requested after the PRP Group filed its Motion for Voluntary Dismissal of Claims Against Solar Sources.

5. The redactions in Solar Sources's fee request do not render the fee request unreasonable.

The PRP Group also argues that the substantial redactions in Solar Sources's fee request make it impossible to determine if the fee request is reasonable, thus warranting a rejection of the entire fee request. However, while this Court has indicated that the redaction of entries on a fee request makes the review of a fee request "substantially more difficult" than if there were no redactions, such redactions do not call for a blanket rejection of an entire fee request. See Wickens v. Shell Oil Co., 569 F.Supp.2d 770, 794 (S.D. Ind. 2008). We will not make such a blanket ruling.

6. Solar Sources is not foreclosed from recovering fees incurred after it switched to a contingency fee agreement.

The PRP Group additionally argues that Solar Sources should not be permitted to recover any fees incurred after it switched to a contingency fee agreement on March 1, 2010. The PRP Group contends that Solar Sources's decision to stop paying attorney fees and switch to a contingency fee agreement proves that the fees Solar Sources was beingcharged were unreasonable. However, contingency fee agreements are routinely used in cases such as this. And, as Solar Sources has indicated, it only switched to a contingency fee agreement after the PRP Group filed its Motion for Voluntary Dismissal of Claims Against Solar Sources. Solar Sources reportedly made the decision to switch to a contingency fee agreement because it was facing significant uncertainty about the outcome of this litigation. After the Motion for...