Hayden v. Vance, CASE NO. 2:15-cv-469-WKW
| Decision Date | 28 June 2016 |
| Docket Number | CASE NO. 2:15-cv-469-WKW |
| Parties | STEVEN MARK HAYDEN, Plaintiff, v. ROBERT S. VANCE, JR., et al., Defendants. |
| Court | U.S. District Court — Middle District of Alabama |
STEVEN MARK HAYDEN, Plaintiff,
v.
ROBERT S. VANCE, JR., et al., Defendants.
CASE NO. 2:15-cv-469-WKW
UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF ALABAMA NORTHERN DIVISION
June 28, 2016
REPORT AND RECOMMENDATION OF THE MAGISTRATE JUDGE
Pursuant to 28 U.S.C. § 636(b)(1), the petition for attorney's fees (Doc. 77, filed 3/24/16) was referred to the undersigned United States Magistrate Judge for review and submission of a report with recommended findings of fact and conclusions of law. The motion is briefed, fully submitted, and ripe for review. In addition, also pending before the Court are (a) Plaintiff's Motion for Lawyer Discipline and FRCP Rule 35 Exam (Doc. 86, filed 4/25/16) and (b) Plaintiff's Motion to Strike, Motion to Void Judgment under Rule 60(b), and Motion for Sanctions (Doc. 102, filed 6/21/16).
For good cause shown and as further discussed below, the Magistrate Judge recommends that the petition for attorney's fees (Doc. 77) be GRANTED in part and DENIED in part, the Motion for Lawyer Discipline and FRCP Rule 35 Exam (Doc. 86) be DENIED, and the Motion to Strike, Motion to Void Judgment under Rule 60(b), and Motion for Sanctions (Doc. 102) be DENIED.
On March 14, 2016, the district judge adopted the Report and Recommendation and dismissed the federal claims with prejudice and the state law claims without prejudice. See
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Docs. 64, 69, 70. The district judge referred back to the undersigned a determination regarding attorneys' fees. See Doc. 69. On March 15, 2016, the undersigned entered a scheduling order on any motions for attorneys' fees. See Doc. 71. Defendants William B. Cashion, Merchants Commercial Bank, and Western Steel Inc. (all represented by Maynard Cooper & Gale PC) timely filed their motion and supporting attachments. Hayden timely responded in opposition, but indicated he had not received the exhibits. See Doc. 80. The issues regarding the sealing of exhibits and ensuring Hayden had all relevant documents was resolved by the district judge. See Docs. 79, 82, 83, 85, 88, 89, and 92. Hayden filed his supplemental opposition to the motion for attorneys' fees on May 31, 2016. See Doc. 96. The motion is now fully briefed and ripe for review. The Court finds no need for oral argument on the matter.
Defendants William B. Cashion, Merchants Commercial Bank, and Western Steel Inc. (collectively "Defendants") request a total of $34,485.56 for fees and costs. See Doc. at p. 3. They assert attorney's fees are merited under both the Alabama Litigation and Accountability Act, Ala. Code § 12-19-270 and the court's inherent authority to impose attorneys' fees and sanctions.
Plaintiff opposes the award of attorney's fees and argues that the Alabama Code is inapplicable as the state law claims were dismissed without prejudice. He also asserts the lack of findings of bad faith in the report and recommendation precludes the award of attorneys' fees and the fees requested are unreasonable. Plaintiff next argues Defense counsel had a conflict of interest and therefore could not represent the Defendants. Finally, Plaintiff argues the fees were unreasonable and Defendant Cashion is incompetent should not be punished with redundant fees.
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A. Whether Attorney's Fees Are Appropriate
Defendants assert attorney's fees are appropriate under both the Alabama Litigation and Accountability Act and the court's inherent authority to impose attorneys' fees. See Doc. 77 generally. The Act states:
[I]n any civil action commenced or appealed in any court of record in this state, the court shall award, as part of its judgment and in addition to any other costs otherwise assessed, reasonable attorneys' fees and costs against any attorney or party, or both, who has brought a civil action, or asserted a claim therein, or interposed a defense, that a court determines to be without substantial justification, either in whole or part;
...
The court shall assess attorneys' fees and costs against any party or attorney if the court, upon the motion of any party or on its own motion, finds that an attorney or party brought an action or any part thereof, or asserted any claim or defense therein, that is without substantial justification, or that the action or any part thereof, or any claim or defense therein, was interposed for delay or harassment, or if it finds that an attorney or party unnecessarily expanded the proceedings by other improper conduct including but not limited to abuses of discovery procedures available under the Alabama Rules of Civil Procedure;
...
No party, except an attorney licensed to practice law in this state, who is appearing without an attorney shall be assessed attorneys' fees unless the court finds that the party clearly knew or reasonably should have known that his action, claim or defense or any part thereof was without substantial justification.
ALA. CODE § 12-19-272(a), (c), (e). Moreover, the phrase "without substantial justification" means "that such action, claim, defense or appeal (including any motion) is frivolous, groundless in fact or in law, or vexatious, or interposed for any improper purpose, including without limitation, to cause unnecessary delay or needless increase in the cost of litigation, as determined by the court." ALA. CODE § 12-19-271(1).
Defendants cite three cases indicating the Alabama Litigation and Accountability Act is
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applicable to federal courts. However, those cases are easily distinguishable from the situation at hand. Plaintiff aptly notes that only the federal claims resulted in a dismissal with prejudice and with regard to the state law claims, the court declined supplemental jurisdiction and dismissed them without prejudice. The two federal cases cited by Defendants (Ledkins v. Welch, Civ. Act. 00-0167, 2000 U.S. Dist. LEXIS 11267, 2000 WL 1135490 (S.D. Ala. July 13, 2000) and Dapremont v. Overcash, Walker & Co., P.C., Civ. Act. No. 99-0353, 2000 U.S. Dist. LEXIS 15228, 2000 WL 1566532 (S.D. Ala. Oct. 4, 2000)) were both cases involving diversity jurisdiction where all claims were resolved in favor of the Defendants on summary judgment. As the state law claims were not actually resolved in favor of the Defendants in the case at bar, the Alabama Litigation and Accountability Act is not applicable and Defendants' cannot recover attorneys' fees as they relate to the state law claims. Thus, the Court looks to its inherent authority.
Courts have the inherent power to impose sanctions when a party acts "in bad faith, vexatiously, wantonly, or for oppressive reasons." Chambers v. NASCO, Inc., 501 U.S. 32, 45-46, 111 S. Ct. 2123, 2133, 115 L. Ed. 2d 27 (1991). "A finding of bad faith is warranted where an attorney knowingly or recklessly raises a frivolous argument, or argues a meritorious claim for the purpose of harassing an opponent. A party also demonstrates bad faith by delaying or disrupting the litigation or hampering enforcement of a court order." Barnes v. Dalton, 158 F.3d 1212, 1214 (11th Cir. 1998) (quoting Primus Automotive Fin. Servs., Inc. v. Batarse, 115 F.3d 644, 649 (9th Cir. 1997)). The bad faith standard is an objective one. Norelus v. Denny's, Inc., 628 F.3d 1270, 1282 (11th Cir. 2010); see also Reyes v. Aqua Life Corp., 632 Fed. Appx. 552, 557 (11th Cir. 2015) (citing Norelus in context of inherent power to impose sanctions). However, the Supreme Court has also warned that "because of their very potency, inherent
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powers must be exercised with restraint and discretion." Chambers, 501 U.S. at 44, 111 S. Ct. at 2132.
The Court also notes the federal claims in this action were brought pursuant to 42 U.S.C. § 1983. "The Court is authorized under 42 U.S.C. § 1988 to award reasonable attorney's fees to the prevailing party in cases arising under civil rights laws, including 42 U.S.C. § 1983." Jaraysi v. City of Marietta, 15 F.Supp.3d 1375, 1381 (N.D. Ga. 2014). "Section 1988 is most often applied to award attorney's fees to the prevailing plaintiff in civil rights litigation, recognizing that the prevailing plaintiff has served as a private attorney general, vindicating a policy that congress considered of the highest priority." Id. (quoting Newman v. Piggie Park Enter., Inc., 390 U.S. 400, 402, 88 S. Ct. 964, 19 L. Ed. 2d 1263 (1968) (per curiam)). However, when the prevailing party is the defendant the equitable considerations at stake are different. Id. Weighing these considerations, the United States Supreme Court held that a district court may only award attorney's fees to a prevailing defendant in a civil rights action upon finding that the plaintiff's civil rights claim "was frivolous, unreasonable, or groundless, or that the plaintiff continued to litigate after it clearly became so." Christiansburg Garment Co. v. Equal Emp't Opportunity Comm'n, 434 U.S. 412, 422, 98 S. Ct. 694, 54 L. Ed. 2d 648 (1978); see also Fox v. Vice, 563 U.S. 826, 833, 131 S. Ct. 2205, 2213, 180 L.Ed.2d 45 (2011) (citing Christiansburg and stating same). Finally, "[a] federal civil rights claim that is dismissed as barred by the doctrine of res judicata is not necessarily a frivolous claim for purposes of § 1988." Jaraysi, 15 F.Supp.3d at 1382 (citations omitted).
Thus, to award Defendants' attorney's fees, the Court must find that Plaintiff's § 1983 claims were frivolous, unreasonable, or groundless. Hayden argues that attorney's fees are not permitted because the Court did not make that finding in its prior Report and Recommendation
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or Opinion adopting it. See Docs. 80, 96. However, the Court may make that finding at any point in the process. If this had been Plaintiff's first challenge, the Court would be loath to make such a finding. It is obvious from Hayden's multiple filings, a review of the state court docket, and the prior case filed in the Northern District of Alabama that Plaintiff simply will not accept the state court judgment and keeps court shopping in the vain hope to find...
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