Lawrence v. First Fin. Inv. Fund V
| Decision Date | 29 March 2022 |
| Docket Number | 2:19-cv-00174-RJS-CMR |
| Parties | CRYSTAL LAWRENCE, On behalf of Plaintiff and Class, v. FIRST FINANCIAL INVESTMENT FUND V, LLC, Defendant. |
| Court | U.S. District Court — District of Utah |
MEMORANDUM DECISION AND ORDER GRANTING PLAINTIFF'S
MOTION FOR APPROVAL OF ATTORNEYS' FEES AND COSTS
Before the court is Plaintiff Christine Lawrence's Motion for Approval of Attorneys' Fees, Litigation Costs, and Administrative Costs.[1] The court held a hearing in this case on January 6, 2022, at which time it granted Plaintiff's Motion for Final Approval of Class Settlement.[2] During that hearing, Defendant First Financial Investment Fund V, LLC indicated it would not be opposing Lawrence's forthcoming requests for attorneys' fees and costs, as long as they were reasonable.[3] To date, no opposition has been filed. For the reasons explained below, the court finds Lawrence's requests to be reasonable and therefore GRANTS the Motion.
Lawrence initiated this action against First Financial in March 2019 alleging violations of the Fair Debt Collection Practices Act (FDCA) and the Utah Consumer Sales Protection Act (UCSPA).[4] In August 2020, this court certified two classes for the case to proceed as a class action against First Financial.[5] The parties engaged in negotiations and ultimately reached an agreement to settle this action on a class basis, and moved the court to amend the certified classes into settlement classes.[6] That motion was denied without prejudice for lacking adequate analysis on the fairness and reasonableness of the settlement under Federal Rule of Civil Procedure 23.[7] Lawrence then filed a second motion to amend the certified classes into settlement classes and notify the class members of the settlement, [8] which the court granted on August 26, 2021.[9]
In December 2021, Lawrence filed a Motion for Final Approval of Class Settlement, [10]and in January 2022 she filed a Motion for Approval of Attorneys' Fees, Litigation Costs, and Administrative Costs (Motion for Fees and Costs).[11] The court held a hearing on January 6, 2022, at which time it granted the Motion for Final Approval of Class Settlement, but informed the parties that it would take up the Motion for Fees and Costs at a later date.[12]
Upon reviewing the Motion for Fees and Costs, the court discovered a discrepancy in the amount Lawrence was requesting. Specifically, the Motion identified three different figures that Lawrence sought as compensation for attorneys' fees.[13] Accordingly, the court issued an order on February 17, 2022 seeking additional clarification from Lawrence as to the exact amount of attorneys' fees being sought.[14] On February 23, Lawrence filed a response clarifying that she is requesting $130, 000 in attorneys' fees, which is roughly 6.4% of the total settlement value.[15]
As Lawrence recognizes, “rarely are all of the Johnson factors applicable.”[22] Accordingly, as is common practice, this court will refrain from addressing all twelve and will instead analyze each factor it finds to be relevant in determining whether the requested percentage is reasonable.[23]
Lawrence requests an award of $130, 000 in attorneys' fees, or approximately 6.4% of the total settlement value.[24] She contends awarding this percentage is appropriate based on a weighing of the relevant Johnson factors.[25] After considering the following factors, the court agrees and finds Lawrence's fees request reasonable.
First, regarding the time and labor involved, Lawrence avers her counsel collectively spent 190 hours litigating this case.[26] She characterizes the case as “heavily litigated, ” pointing to the multiple discovery motions, First Financial's summary judgment motion, her class certification motion, and the significant time the parties spent in settlement negotiations, including a full day of mediation.[27] The court agrees that the time and labor counsel have spent on this case supports the fee award.
Next, regarding the complexity and novelty of the issues, Lawrence articulates the following issues that were presented in this case: whether Utah Code § 12-1-1's registration and bonding requirements apply to “passive” debt buyers; “whether the filing of collection lawsuits against Utah consumers in the name of an unregistered passive debt buyer is collection activity for which registration is required; whether conducting such activity without registration violates the Utah Consumer Sales Practices Act (UCSPA); whether conducting unregistered collection violates the Fair Debt Collection Practices Act (FDCPA);” application of res judicata to USCPA claims; and the availability of class-wide relief to a UCSPA class in federal court.[28] Lawrence cites to five cases where courts have reached differing results on several of these issues, [29] and four currently pending appeals considering all or some of the identified issues.[30] A review of the cited authorities, as well as the court's own experience in this case, demonstrates the issues were indeed novel and complex. Accordingly, this factor weighs in favor of the requested award.
On the requisite skills factor, Lawrence asserts “class actions tend to involve a specialized area of the law which is often complex and difficult, and where some degree of extra skill is needed to litigate the cases properly.”[31] She adds that, given the novelty of the issues, this case involved more skill than a “garden variety” class action.[32] The court agrees, and finds this factor supports the proposed award.
Lawrence next acknowledges the preclusion of other employment for her counsel “is not a significant factor in . . . this case.”[33] Thus, this factor has a neutral effect on the assessment of the requested fee award.
As to the customary fee in other common fund consumer class actions, Lawrence points to several courts that have allowed much higher percentages, ranging from 22% to 40%.[34]Lawrence states that a relatively smaller percentage was intentionally sought in this case to “ensure a meaningful cash recovery for the 367 class members.”[35] Because much higher percentages have been found reasonable in similar cases, the court is more than satisfied that this factor weighs in favor of approving a 6.4% fee award.
Regarding any prearranged fee, Lawrence informs the court that this case was initially taken on a contingency fee basis, which she asserts is “often considered an important factor.”[36]Indeed, courts do consistently find “this type of arrangement, under which counsel runs a significant risk of nonpayment, weighs in favor of the reasonableness of a requested fee award.”[37] Thus, where the award being sought in this case is equal to 6.4% of the settlement, when typical contingency fees in similar cases are often one third of the total economic benefit the class receives, [38] this factor weighs in favor of approving Lawrence's proposed award.
Regarding the amount involved and results obtained, Lawrence notes $1.8 million in debt forgiveness was recovered for the class, in addition to $230, 000 in cash placed in the common fund.[39] Lawrence also contends that, even after the proposed fees, costs, and class representative awards are deducted, the 367 class members will be entitled to cash payments of roughly $200, in addition to the forgiven debt.[40] This is a positive outcome for the class members on the whole. Therefore, this factor weighs in favor of the proposed fee amount.
Regarding the experience, reputation, and abilities of the three class counsel, Lawrence avers Mr. Borison has over thirty years of practice and a track record of receiving 40% fee awards in common fund class actions, and “Mr. Baczynski and Mr. Ayres have significant experience with the Utah Consumer Sales Practices Act.”[41] Based on these representations, this factor favors the proposed fee award for class counsel.
Lawrence next contends that the undesirability factor, “while not particularly heavy, weighs in favor of the fee request” because “there are few attorneys who would be willing” to take on a debtors' class action case on a contingency basis.[42] Taking this claim at face value, the court finds this factor supports the award because while this...
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