HLV, LLC v. Stewart, 1:13-cv-1366

• Court: United States District Courts. 6th Circuit. United States District Court (Western District Michigan)
• Citation: 355 F.Supp.3d 633
• Docket Number: No. 1:13-cv-1366,1:13-cv-1366
• Parties: HLV, LLC, Plaintiff, v. Gary STEWART, Jr., Defendant.
• Decision Date: 16 January 2019

355 F.Supp.3d 633

HLV, LLC, Plaintiff,
v.
Gary STEWART, Jr., Defendant.

No. 1:13-cv-1366

United States District Court, W.D. Michigan, Southern Division.

Signed January 16, 2019

355 F.Supp.3d 635

J. Nicholas Bostic, Bostic & Associates, Lansing, MI, Brittany Burke Dzuris, Donald R. Visser, Visser and Associates PLLC, Kentwood, MI, for Plaintiff.

Lee T. Silver, Silver & Van Essen PC, Grand Rapids, MI, Robert A. Callahan, Susan Anne Finnegan, Plunkett Cooney, Kalamazoo, MI, for Defendant.

ORDER DENYING MOTION FOR ATTORNEY'S FEES AND COSTS

Paul L. Maloney, United States District Judge

This matter is before the Court on Plaintiff HLV, LLC's motion for attorney's fees and costs as a prevailing party under Federal Rule of Civil Procedure 54(d)(2) and 42 U.S.C. § 1988(b). HLV seeks $490,797.90 in attorney's fees, costs and related fees, and additional prejudgment interest to be determined. Defendant Gary Stewart has filed a response in opposition to Plaintiff's motion, requesting that the Court deny the motion and disallow an award of attorney's fees and costs because Plaintiff was only a marginally successful litigant, having been awarded solely nominal damages by the jury. The Court agrees with Stewart and will DENY HLV's motion for attorney's fees and costs.

I.

The history is well-worn. In December 2013, HLV and related entities filed suit against numerous Defendants including Van Buren County, the Village of Paw Paw, Kelly Page, Gary Stewart, the Page & Stewart Partnership, Judge Paul Hamre, Peggy Grote, Michael McKay, and Michael Bedford. HLV raised claims under RICO (Counts I–III), § 1983 (Counts IV–VI), and a state-law claim for tortious interference with contract. More than four years later, after three rounds of dispositive motions, innumerable discovery disputes, and extended pretrial motion practice, HLV settled with Kelly Page and proceeded to trial against Defendant Gary Stewart. After six days of trial, a jury concluded that Gary Stewart had conspired with Paul Hamre, or with Kelly Page and Paul Hamre, to deprive HLV of its property without due process of law.

However, the Court had previously found that HLV had never satisfactorily produced a method of computing compensatory damages arising from the conspiracy—HLV's principals had testified that they had been paid in full on the underlying debt collection lawsuit—, had failed to adequately respond to discovery requests relating to damages, and so it precluded HLV from seeking compensatory damages against Stewart at trial. Therefore, the jury was instructed that if it found for HLV on the cause of action against Stewart, it was to award nominal damages and could further consider punitive damages.

In closing argument, HLV urged the jury to award punitive damages and suggested that the jury begin with a figure of $300,000 "per overt act" and outlined nine overt acts that it viewed to be in furtherance of the conspiracy. Thus, HLV asked the jury to award a total of $2.7 million in punitive damages. (ECF No. 532 at PageID.8917.) The jury was not so persuaded. It awarded $1 in nominal damages but declined to award punitive damages to HLV.

Now, Plaintiff, as a prevailing party, seeks $490,797.90 in attorney's fees and costs under Rule 54(d)(2) and 42 U.S.C. § 1988(b).

355 F.Supp.3d 636

A. Attorney's Fees Under § 1988

The Civil Rights Attorney's Fees Award Act of 1976, 42 U.S.C. § 1988(b), permits a court in its discretion to award the "prevailing party" in a § 1983 action "reasonable" attorney's fees as part of the costs. Even a plaintiff who wins only nominal damages is considered a "prevailing party" for purposes of § 1988. Farrar v. Hobby , 506 U.S. 103, 112, 113 S.Ct. 566, 121 L.Ed.2d 494 (1992). Although the technical nature of a nominal damages award does not disqualify a plaintiff from prevailing party status, it does bear on the reasonableness of any attorney's fees award. Id. at 114, 113 S.Ct. 566. The most critical factor in determining the reasonableness of an attorney's fees award is the degree of success obtained. Id. In a civil rights action for compensatory and punitive damages, the awarding of only nominal damages highlights the plaintiff's failure to prove actual injury or any basis for awarding punitive damages. See id. at 115, 113 S.Ct. 566. "When a plaintiff recovers only nominal damages because of his failure to prove an essential element of his claim for monetary relief, the only reasonable fee is usually no fee at all." Pouillon v. Little , 326 F.3d 713 (6th Cir. 2003) (quoting Farrar, id. ).

Here, like in Pouillon and Farrar , HLV's technical victory "accomplished little beyond giving [it] the moral satisfaction of knowing that a federal...