Lebamoff Enters. v. Snyder

• Decision Date: 29 November 2021
• Docket Number: 2:17-cv-10191
• Court: U.S. District Court — Eastern District of Michigan
• Parties: LEBAMOFF ENERPRISES, INC., JOSEPH DOUST, JACK STRIDE, JACK SCHULZ, and RICHARD DONOVAN, Plaintiffs v. RICK SNYDER, WILLIAM SCHUETTE, and ANDREW J. DELONEY, Defendants

LEBAMOFF ENERPRISES, INC., JOSEPH DOUST, JACK STRIDE, JACK SCHULZ, and RICHARD DONOVAN, Plaintiffs
v.
RICK SNYDER, WILLIAM SCHUETTE, and ANDREW J. DELONEY, Defendants

No. 2:17-cv-10191

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

November 29, 2021

District Judge Arthur J. Tarnow

REPORT AND RECOMMENDATION TO (1) DENY THE STATE DEFENDANTS' MOTION FOR ATTORNEY FEES UNDER 42 U.S.C. § 1988(b) (ECF No. 67); but, (2) GRANT THE STATE DEFENDANTS' MOTION TO REVIEW THIS COURT'S APRIL 27, 2021 TAXATION OF COSTS (ECF No. 72)

ANTHONY P. PATTI, UNITED STATES MAGISTRATE JUDGE

I. RECOMMENDATION:

The Court should (1) DENY the State efendants' motion for attorney fees under 42 U.S.C. § 1988(b) (ECF No. 67); but, (2) ACCEPT the State Defendants' amended bill of costs (ECF Nos. 72-1, 72 2, 72-3, 72-4), GRANT the State Defendants' motion to review this Court's April 27, 2021

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taxation of costs (ECF No. 72), and AWARD the State Defendants a total of $734.98 in costs.^[1]

II. REPORT

A. Background

This lawsuit challenged the constitutionality of Senate Bill 1088, which amends Mich. Comp. Laws § 436.1203 and, in Plaintiffs' words, “allows Michigan wine retailers to sell, ship and deliver wine directly to consumers within the state of Michigan, while prohibiting out-of-state retailers from doing so.” (ECF No. 5, PageID.18.) As set forth in the February 2017 amended complaint:

1. Plaintiff Lebamoff Enterprises Inc. ("Lebamoff Enterprises") is “an Indiana corporation that operates 15 wine retail stores in Fort Wayne, Indiana.” (Id., PageID.19 ¶ 4.)

2. Joseph Doust, a wine manager for Lebamoff Enterprises, is “a professional wine consultant, advisor, and merchant who resides in and is a citizen of Indiana.” (Id., PageID.22 ¶ 22.)

3. Consumer Plaintiffs Jack Stride, Jack Schulz, and Richard Donovan are residents of Michigan who regularly purchase and consume “fine wine and would purchase wine from out-of-state retailers and have those wines shipped to their residences in

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Michigan, if Michigan law permitted them to do so.”

(Id., PageID.19 ¶ 3.)

Plaintiffs alleged violations of: (1) the Commerce Clause, which provides that “[t]he Congress shall have Power . . . [t]o regulate Commerce . . . among the several States . . . [, ]” U.S. Const. art. I, § 8, cl. 3; and, (2) the Privileges and Immunities Clause, which provides that “[t]he Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States.” U.S. Const. art. IV, § 2, cl. 1. (Id., PageID.21-23 ¶¶ 13-28.)

Plaintiffs bring this lawsuit against Rick Snyder, William Schuette, and Andrew J. Deloney (“the State Defendants”). (Id., PageID.20-21 ¶¶ 8-10.) In April 2017, the Court permitted Michigan Beer and Wine Wholesalers Association (MBWWA) to intervene as a Defendant. (ECF No. 13.)

B. Dispositive motion practice

Plaintiffs filed a motion for summary judgment in February 2018 (ECF No. 31), and Defendants filed their motions for summary judgment in April 2018 (ECF Nos. 33, 34.) On September 27, 2018, the Supreme Court granted a petition for writ of certiorari to the United States Court of Appeals for the Sixth Circuit in Tennessee Wine & Spirits Retailers Ass'n v. Byrd, 139 S.Ct. 52 (2018). (ECF No. 42.) The following day, this Court denied the State and Intervenor Defendants' motions for summary judgment and granted Plaintiffs' motion for summary judgment, without reaching Plaintiffs' Privileges and Immunities claim. Lebamoff Enterprises v. Snyder,

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347 F.Supp.3d 301, 311 (E.D. Mich. 2018). (See also ECF Nos. 43, 44.)

The State Defendants and Intervenor Defendant appealed. (ECF Nos. 48, 50.)^[2] On November 6, 2018, the Sixth Circuit granted motions to hold the appeals in abeyance pending the Supreme Court's decision in Tenn. Wine and Spirits Retailers Ass'n. (ECF No. 53.) The Supreme Court issued its decision on June 26, 2019. Tennessee Wine & Spirits Retailers Ass'n, 139 S.Ct. at 2457 (invalidating “a provision requiring applicants for an initial license to have resided in the State for the prior two years, ” because it “violates the Commerce Clause and is not shielded by § 2 of the Twenty-first Amendment.”)

On April 21, 2020, the Sixth Circuit concluded in the instant matter that, “[b]ecause the Twenty-first Amendment permits Michigan to treat in-state retailers (who operate within the three-tier system) differently from out-of-state retailers (who do not), we uphold the law[, ]” which effectively reversed this Court's September 28, 2018 decision and remanded the case to this Court. Lebamoff Enterprises Inc. v. Whitmer, 956 F.3d 863, 867, 878 (6th Cir. 2020). (See also ECF No. 56.) The Supreme Court denied Plaintiffs' petition for a writ of certiorari on January 11, 2021. Lebamoff Enterprises, Inc. v. Whitmer, 141 S.Ct. 1049 (2021).

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(See also ECF No. 62.) Then, on March 30, 2021, this Court reopened the case, voided its prior judgment, granted the State and Intervenor Defendants' motions for summary judgment, and denied Plaintiffs' motion for summary judgment. (ECF No. 64; see also ECF No. 65.)

C. Motion to Review this Court's Taxation of Costs

On April 27, 2021, the State Defendants filed a bill of costs for deposition transcripts ($229.98) and appeals costs ($505.00), i.e., a total of $734.98. (ECF No. 66.) Intervenor Defendant MBWWA filed a bill of costs for appeals costs ($505.00). (ECF No. 69.) As to each of these requests, the Clerk of the Court taxed costs in the amount of $505.00. (ECF Nos. 70, 71.) However, with respect to the State Defendants' request for court reporter fees, the Clerk of the Court explained: “No receipts/invoices are attached to the bill of costs and the bill of costs fails to document how the corresponding deposition transcripts were used by the prevailing defendants.” (ECF No. 70, PageID.987.)

Currently before the Court is the State Defendants' motion to review this Court's April 27, 2021 taxation of costs, which asks the Court “to grant their motion to review the taxation of costs, to accept the Amended Bill of Costs and attachments in support, and to award the prevailing Defendants a total of $734.98 in costs.” (ECF No. 72, PageID.995.) To date, Plaintiffs have not filed a response.

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The Court should ACCEPT the State Defendants' amended bill of costs (ECF No. 72-1) and its attachments - (1) a September 19, 2017 invoice from Network Reporting for $229.98 (ECF No. 72-3); (2) a declaration regarding the use of deposition transcripts (ECF No. 72-2), namely in their April 2, 2018 motion for summary judgment and response in opposition to Plaintiffs' motion for summary judgment (ECF No. 34); and, (3) the Sixth Circuit's June 4, 2020 mandate (ECF No. 72-4) - because the attachments cure the deficiencies noted by the Clerk of the Court on April 28, 2021. (ECF No. 70.) Accordingly, the Court should DEEM SUPERSEDED the initial bill of costs (ECF No. 66) and the related taxation (ECF No. 70), GRANT Defendants' motion to review the taxation of costs (ECF No. 72) and AWARD the State Defendants a total of $734.98 in costs.

D. Motion for Attorney Fees

Also before the Court is the State Defendants' motion for attorney fees under 42 U.S.C. § 1988(b), which asks the Court to “grant reasonable attorney's fees to the State Defendants for the time spent defending against the Plaintiffs' frivolous Privileges and Immunities claim.” (ECF No. 67, PageID.967.) Plaintiffs have filed a response in opposition, and the State Defendants have replied. (ECF Nos. 74, 75.) Pursuant to Federal Rule of Civil Procedure 54, the Court may, upon motion by a party, award attorney fees. Section 1988 of the Civil Rights Act

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authorizes an award of attorney fees to a party that has prevailed in litigation brought under § 1983. Specifically:

In any action or proceeding to enforce a provision of sections 1981, 1981a, 1982, 1983, 1985, and 1986 of this title, title IX of Public Law 92-318, the Religious Freedom Restoration Act of 1993, the Religious Land Use and Institutionalized Persons Act of 2000, title VI of the Civil Rights Act of 1964, or section 12361 of Title 34, the court, in its discretion, may allow the prevailing party, other than the United States, a reasonable attorney's fee as part of the costs, except that in any action brought against a judicial officer for an act or omission taken in such officer's judicial capacity such officer shall not be held liable for any costs, including attorney's fees, unless such action was clearly in excess of such officer's jurisdiction.

42 U.S.C. § 1988(b).

Parties are considered prevailing where they “succeed on any significant issue in litigation which achieves some of the benefit the parties sought in bringing suit.” Hensley v. Eckerhart, 461 U.S. 424, 433 (1983) (internal quotations omitted) (emphasis added). A prevailing plaintiff “should ordinarily recover an attorney's fee unless special circumstances would render such an award unjust.” Id. at 429 (quotations and citation omitted). Courts calculate the amount of fees to award by multiplying the number of hours reasonably expended on litigation and a reasonable hourly rate, subject to any adjustments. Id. at 433.

1. Prevailing party

Plaintiffs' argument that Defendants “are not prevailing parties on the Privileges and Immunities issue[, ]” (ECF No. 74, PageID.1009), is unavailing.

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First, Plaintiffs contend that Defendants' motion for summary judgment was denied on the Privileges and Immunities claim. (Id.) However, this Court's September 28, 2018 order, which denied the State Defendants' motion for summary judgment, expressly found “the Commerce Clause sufficient grounds for relief, ” and “decline[d] to reach Plaintiffs' Privileges and Immunities claim.” (ECF No. 43, PageID.864 (emphasis added).) Later, on April 21, 2020, the Sixth Circuit concluded that, “[b]ecause the...