Oron 2015, LLC v. City of Southfield
| Decision Date | 16 September 2020 |
| Docket Number | Case No. 18-12671 |
| Parties | ORON 2015, LLC, Plaintiff, v. CITY OF SOUTHFIELD, Defendant. |
| Court | U.S. District Court — Eastern District of Michigan |
On January 8, 2020, the Court granted Plaintiff Oron 2015, LLC's motion to voluntarily dismiss its claims without prejudice pursuant to Federal Rule of Civil Procedure 41(a)(2), over the objection of Defendant City of Southfield (Dkt. 45). As stated in that order, "[a] dismissal under Rule 41(a)(2) 'may be conditioned on whatever terms the district court deems necessary to offset the prejudice the defendant may suffer from a dismissal without prejudice,' including payment of costs incurred by a defendant." 1/8/20 Op. & Order Granting Pls. Mot. for Dismissal Without Prejudice at 3 (Dkt. 45) (quoting Bridgeport Music, Inc. v. Universal-MCA Music Pub., Inc., 583 F.3d 948, 954 (6th Cir. 2009)). That order specified which fees and costs would be compensable—the fees and costs Southfield incurred in defending this action prior to Oron's filing of its motion to dismiss, other than fees and costs attributable to the City's document productions. Id. at 5. The Court also ordered Southfield to submit "the customary itemization showing attorney hours and rates" along with a motion for attorney fees and costs. Both Southfield and Oron seek to re-litigate matters decided in that order, but neither has argued persuasively that the balance struck in that order was flawed. Furthermore, counsel for Southfield has not submitted the rates at which it actually billed its client, so attorney fees cannot yet be awarded. However, the costs for which Southfield petitions can be awarded. Southfield's motion is, therefore, granted in part.
Oron first argues that no fees should be awarded and requests that this case be dismissed with prejudice and without fees. See Resp. at (Dkt. 47).
First, as a procedural matter, Oron uses its response brief to the instant motion as an opportunity to petition the Court to reconsider its previous ruling. This district allows for motions to reconsider, but such motions must be filed within 14 days after entry of the judgment or order. E.D. Mich. LR 7.1(h). Oron failed to file such a motion but nonetheless seeks reconsideration. Based on the court rule, denial of that request is warranted.
Even if the Court were to allow this belated attempt, it would not accept Oron's argument. For the Court to grant a motion for reconsideration, "[t]he movant must not only demonstrate a palpable defect by which the Court and the parties and other persons entitled to be heard on the motion have been misled but also show that correcting the defect will result in a different disposition of the case." Here, Oron has identified no palpable defect in the previous order.
Oron cites Walther v. Fla. Tile, Inc., 776 F. App'x 310, 318 (6th Cir. 2019), which provides a list factors courts should consider when deciding whether to award fees as a condition of dismissal under Rule 41(a)(2): "whether the plaintiff acted in good faith in bringing the action, extensive discovery costs were involved, and extraordinary expenses were incurred in defending the action." Oron argues that none of those reasons justifies the imposition of fees in this case. But Walther does not present that list as exhaustive, nor does it abrogate Bridgeport Music's widegrant of authority to district courts. Here, the award of fees was not premised on any of the factors mentioned in Walther. Instead, it was premised on the prejudice Southfield experienced by being unable to litigate this case through judgment and set a favorable precedent, and by the incurrence of costs that, while perhaps not extraordinary, were nonetheless substantial, and which paid for work that will not be re-usable if Oron or a related plaintiff files a second lawsuit. The Court attempted to strike a reasonable balance by only awarding fees and costs for work that could not be re-used, and this belated attempt to challenge that decision fails to show a palpable defect.
Finally, Oron now requests that this matter be dismissed with prejudice and without costs or fees. However, Oron itself filed the motion to dismiss the case without prejudice (Dkt. 33). The fact that it now sees why that decision may have had unforeseen costs does not justify re-writing this case's history, which might have been very different, and far less expensive, if Oron had filed a motion to dismiss the case with prejudice at an earlier stage.
Despite the Court's previous statement that recovery would be limited to expenses incurred prior to Oron's filing of its motion for voluntary dismissal, Southfield's billing records include over one hundred hours—approximately 30% of the hours for which it requests compensation—for hours billed after Oron filed its motion to dismiss the case without prejudice.
Southfield does not present an argument in the analysis section of its brief for why the Court should reconsider its previous decision, which should have been presented as a motion to reconsider. Instead, it asserts that it was "forced" to continue litigating this case under the scheduling order, because the Court did not immediately rule on the motion for voluntary dismissal or Oron's motion for a protective order. Statement of Facts ¶ 10 (Dkt. 46). However, Southfield never sought an adjournment of the scheduling order, which could have spared the parties theexpenses incurred in litigating this case after Oron filed its motion to dismiss without prejudice. Furthermore, the case proceeded because Southfield refused to agree to dismissal. Of course, it had the right to do so, but expenses Southfield incurred because it wished to see this case through judgment cannot be said to "offset the prejudice the defendant may suffer from a dismissal without prejudice." See Bridgeport Music, Inc., 583 F.3d 948. Oron had a perfectly acceptable reason for wishing to dismiss the case—it was not cost-effective to litigate once class status was denied—and Oron acted promptly to dismiss the case once class status was denied. Southfield's costs in pressing the case further were incurred because Southfield wished the case to go further, and it is not entitled to fees for that portion of the case.
Counsel for Southfield has not submitted its bills or informed the Court of the rates it actually charged Southfield. Instead, Southfield submitted data from the 2017 Economics of Law Practice Attorney Income and Billing Rate Summary report prepared by the State Bar of Michigan and proposes various formulas by which its attorneys' reasonable rates should be calculated. Oron opposes this method, noting that municipal governments often negotiate favorable rates for paying attorneys, likely less than the rates Southfield seeks to recover from Oron.
This Court has little to add to an opinion rejecting Southfield and its attorneys' position in a previous case:
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