Paeste v. Gov't of Guam
| Decision Date | 02 December 2013 |
| Docket Number | CASE NO. 11-00008-CBM |
| Parties | RIA MIALIZA O. PAESTE, et al., Plaintiffs, v. GOVERNMENT OF GUAM, et al., Defendants. |
| Court | U.S. District Court — District of Guam |
ORDER GRANTING PLAINTIFFS'
MOTION FOR AN AWARD OF
The matter before the Court is Plaintiffs' Motion for an Award of Attorney's Fees and Costs. [Docket No. 202.] For the reasons stated below, the Court GRANTS the Motion in part.
Plaintiffs Ria Mializa O. Paeste, Jeffrey F. Paeste, Sharon Zapanta, and Glenn Zapanta are residents and taxpayers on Guam who brought suit to challenge government practices relating to the administration of the Guam Territorial Income Tax ("GTIT"). (First Amended Class Action Complaint ("FAC") at ¶ 1.)
Plaintiffs alleged that, even as the Government of Guam is unable to pay all GTIT refunds, it distributes about $15 million a year to certain taxpayers who procure "expedited" refunds. (Id. at ¶ 3.) The expedited refunds are intended for taxpayers suffering through a medical emergency, death in the family, or other financial hardship. (Id. at ¶ 4.) Plaintiffs further alleged that, in practice, the payments are ad hoc and/or are based on a system of political patronage or personal connections. (Id. at ¶ 4.)
Following Defendants' unsuccessful motion to dismiss Plaintiffs' FAC (Docket Nos. 38, 86, 136) the Court certified a class consisting of:
All persons and entities who have filed or will file a claim for refund of an overpayment of the Guam Territorial Income Tax: (i) which the Government of Guam has processed or will process and deemed valid; (ii) who have met the procedural requirements outlined in 26 U.S.C. §§ 7422(a) and 6532(a); and (iii) who nonetheless have not received or will not receive their refund six months after filing the claim for refund.
The parties engaged in discovery, including document requests, requests for admission, interrogatories, and sixteen depositions. (Declaration of Daniel C. Girard In Support of Plaintiffs' Motion for an Award of Attorney's Fees and Costs ("Girard Decl.") at ¶¶ 6-11, Docket No. 203; Resp. at 10.) Plaintiffs also filed two motions to compel production of documents. [Docket Nos. 59, 118.]
Plaintiffs moved for summary judgment after the close of discovery.1 [Docket No. 160, 153.] Following argument by the parties, the Court granted Plaintiffs' motion as to both of Plaintiffs' causes of action. The Court found that by failing to fully administer taxpayer claims for GTIT refunds in a timely, orderly, and equitable manner, Defendants violated their administrative andenforcement responsibilities under the Organic Act, 48 U.S.C. § 142li. (Findings of Fact and Conclusions of Law at ¶¶ 6-7, 18-20, Docket No. 196.) The Court also found that the Defendant officials denied taxpayers the right to equal protection of the laws in violation of 42 U.S.C. § 1983 by partially administering taxpayer claims for GTIT through an arbitrary, ad hoc process. (Id. at ¶¶ 8-16, 21-30.)
Pursuant to Fed. R. Civ. P. 54(d), Plaintiffs timely moved for award of attorney's fees and costs within fourteen days of the Court's entry of judgment in their favor. [Docket Nos. 197, 202.] Plaintiffs request a total fee award of $2,187,805.50 (including time expended on this Motion), consisting of $1,452,590.50 in attorneys' fees to the law firm of Girard Gibbs LLP ("GG") and $735,215 in attorneys' fees to the law firm of Lujan, Aguigui & Perez LLP ("LAP"). (Girard Decl. at 7; Declaration of Ignacio C. Aguigui In Support of Plaintiffs' Motion for an Award of Attorney's Fees and Costs ("Aguigui Decl.") at 7, Docket No. 204.) Plaintiffs also request an award of costs in the total amount of $88,445.23, consisting of $75,407.35 to the law firm of Girard Gibbs LLP and $13,037.88 to the law firm of Lujan, Aguigui & Perez LLP. (Girard Decl. at ¶ 37; Aguigui Decl. at ¶ 48.)
42 U.S.C. §1988 provides that in federal civil rights actions "the court, in its discretion, may allow the prevailing party . . . a reasonable attorney's fee as part of the costs." 42 U.S.C. §1988 (b). The party applying for fees "bears the burden of establishing entitlement to an award and documenting the appropriate hours expended and hourly rates." Hensley v. Eckerhart, 461 U.S. 424, 437 (1983). When determining fees, the Ninth Circuit requires that district courts calculate a "lodestar." See Allen v. Shalala, 48 F.3d 456, 458 (9th Cir. 1995). The lodestar is determined by multiplying the number of hours reasonably spent on a case by a reasonable hourly rate. See Hensley, 461 U.S. at 433.
The lodestar may then be adjusted by considering the twelve factors articulated in Kerr v. Screen Extras Guild Inc., 526 F.2d 67, 69-70 (9th Cir. 1975), to the extent these factors have not been subsumed in the lodestar calculation. Cunningham v. County of Los Angeles, 879 F.2d 481, 484 (9th Cir. 1989). The Kerr factors include: (1) the time and labor required; (2) the difficulty and novelty of the issues; (3) the skill required; (4) preclusion of other employment by the attorney; (5) the customary fee; (6) whether the fee is contingent or fixed; (7) the restraints imposed by the client or the circumstances; (8) the amount involved and the results achieved; (9) experience, ability, and reputation of the attorneys; (10) the "undesirability" of the case; (11) nature and length of the professional relationship between the attorney and client; and (12) awards in similar cases. Kerr, 526 F.2d at 69-70; see also Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542, 130 S. Ct. 1662, 1669, 176 L. Ed. 2d 494 (2010); Tutor-Saliba Corp. v. City of Hailey, 452 F.3d 1055, 1065 (9th Cir. 2006) ().
Plaintiffs are the prevailing party in this litigation, and pursuant to 42 U.S.C. §1988 Plaintiffs are entitled to legal fees for time reasonably expended on this case, as well as for time reasonably expended in the preparation of this fee application.
Defendants argue that Plaintiffs' attorneys' fee request should be denied altogether because Plaintiffs failed to provide time or billing records, relying instead on the Girard and Aguigui Declarations to provide summaries of the work performed. (Resp. at 8-9.) In the alternative, Defendants argue that GG should receive no more than $339,513 in attorneys' fees and LAP should receive no more than $242,000 in attorneys' fees due to block-billing, excessive hourly rates, overstaffing, and unnecessary motion practice and other litigation decisions. (Resp. at 11-20, 25-26.)
Assuming, arguendo, that Plaintiffs' documentation of their attorneys' fee request is inadequate, the remedy is not denial of the fees altogether but "the district court may reduce the award accordingly." Sorenson v. Mink, 239 F.3d 1140, 1146 (9th Cir. 2001) (citing Hensley, 461 U.S. at 424). The Court will thus determine a lodestar amount for Plaintiffs' counsel, taking into account the type of documentation submitted by Plaintiffs' counsel.
The Court finds that the 2,502.7 hours requested by the LAP Firm and the 3,337.8 hours requested by the GG Firm to be reasonable. Attorneys' fees may be awarded for work that is useful and of a type ordinarily necessary to secure the final result obtained from the litigation. Nadarajah v. Holder, 569 F.3d 906, 923 (9th Cir. 2009) (citations omitted); see also Moreno v. City of Sacramento, 534 F.3d 1106, 1112 (9th Cir. 2008) (); Moore v. Jas. H. Matthews & Co., 682 F.2d 830, 839 (9th Cir.1982) ().
Defendants raise several objections to Plaintiff's requested hours, arguing that the hours should be reduced by 50% for overstaffing and time spent on media contacts. (Resp. at 10, 13-14.) Defendants further argue that Plaintiffs are not entitled to compensation for time requested either prior to the filing of the operative complaint or for a motion to compel that was never ruled upon. (Id. at 12-13.) Defendants' arguments are without merit. See Moreno, 534 F.3d at 1112 (); Cabrales v. County of Los Angeles, 935 F.2d 1050, 1052-53 (9th Cir. 1991) (). The Court overrules Defendants' objections.
"[T]he established standard when determining a reasonable hourly rate is the 'rate prevailing in the community for similar work performed by attorneys of comparable skill, experience, and reputation.'" Camacho v. Bridgeport Fin., Inc., 523 F.3d 973, 979 (9th Cir. 2008) (citations omitted); see also Blum v. Stenson, 465 U.S. 886, 895, 104 S. Ct. 1541, 1547, 79 L. Ed. 2d 891 (1984) ().
The parties disagree whether San Francisco or Guam hourly rates are appropriate for the San Francisco-based Girard Gibbs LLP.2 The Ninth Circuit follows a "comparatively strict forum rule." Arbor Hill Concerned Citizens Neighborhood Ass'n v. Cnty. of Albany & Albany Cnty. Bd. of Elections, 522 F.3d 182, 190 n. 5 (2d Cir. 2008). "Rates outside the forum may be used if local counsel was unavailable, either because they are unwilling or unable to perform because they lack the degree of experience, expertise, or specialization required to handle properly the case." Camacho, 523 F.3d at 979 (citing Barjon v. Dalton, 132 F.3d 496, 500-501 (9th Cir. 1997)); ...
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