Treasure Cay Condo. Ass'n v. Frontline Ins. Unltd. Co.

• Decision Date: 13 January 2023
• Docket Number: 4:19-cv-10211-JLK/Becerra
• Parties: TREASURE CAY CONDOMINIUM ASSOCIATION, INC. A/K/A TREASURE CAY CONDO ASSOC INC., Plaintiff, v. FRONTLINE INSURANCE UNLIMITED COMPANY, Defendant.
• Court: U.S. District Court — Southern District of Florida

TREASURE CAY CONDOMINIUM ASSOCIATION, INC. A/K/A TREASURE CAY CONDO ASSOC INC., Plaintiff,
v.
FRONTLINE INSURANCE UNLIMITED COMPANY, Defendant.

No. 4:19-cv-10211-JLK/Becerra

United States District Court, S.D. Florida

January 13, 2023

REPORT AND RECOMMENDATION^[1] ON PLAINTIFF'S MOTION FOR ATTORNEY'S FEES AND COSTS AND BILL OF COSTS

JACQUELINE BECERRA UNITED STATES MAGISTRATE JUDGE

THIS CAUSE came before the Court on Plaintiff Treasure Cay Condominium Association, Inc.'s (“Plaintiff” or “Treasure Cay”) Motion for Attorney's Fees and Costs (“Motion for Fees”). ECF No. [96]. Defendant Frontline Insurance Unlimited Company (“Defendant” or “Frontline”) filed a Response, ECF No. [97], and Plaintiff filed its Reply, ECF No. [99]. Additionally, Plaintiff filed a Bill of Costs. ECF No. [91]. Defendant filed a Response, ECF No. [94], and Plaintiff filed a Reply, ECF No. [95]. The Parties appeared before the undersigned for oral argument on November 4, 2022 (the “Hearing”). ECF No. [102]. After due consideration of the Motion for Fees and the Bill of Costs, the pertinent portions of the record, and being otherwise fully advised in the premises, it is RECOMMENDED that Plaintiff's Motion for Fees, ECF No. [96], and Bill of Costs, ECF No. [91], be GRANTED IN PART AND DENIED IN PART, as discussed further below.

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I. BACKGROUND AND INSTANT MOTION

This action arises from a dispute concerning an insurance claim following Hurricane Irma. See generally ECF No. [1]. Plaintiff filed its Complaint in Florida state court, and Defendant removed the action to this Court on the basis of diversity jurisdiction. See id. In support thereof, Defendant attached the Declaration of its Vice President of Risk Management, stating that Defendant Frontline is a citizen of Illinois. See ECF No. [1-1]. However, when Defendant filed its Answer and Affirmative Defenses, it admitted that its principal place of business was in Florida. See ECF Nos. [1-6] ¶ 4; [3] ¶ 4. During the pendency of the action before this Court, neither party recognized this discrepancy, and no motion to remand was made.

The Parties filed cross-motions for summary judgment. ECF Nos. [49], [52]. This Court entered an order granting Defendant's motion and entered a final judgment in favor of Defendant. ECF Nos. [71], [72]. Plaintiff appealed. ECF No. [74].

On appeal, the Eleventh Circuit, recognizing the discrepancy in the information Defendant submitted concerning its citizenship, asked the Parties “to be prepared to discuss at oral argument whether the Court has subject matter jurisdiction over this action in light of Frontline Insurance Unlimited Company's admission that its principal place of business is in Lake Mary, Florida.” ECF No. [96-1] at 2 (emphasis removed). After that prompting, the Parties agreed that this Court did not have jurisdiction over the matter and filed a joint motion to dismiss. See ECF No. [84]. The Eleventh Circuit granted the motion and remanded with instructions for this Court to vacate its order and remand to state court. Id. The District Court vacated its prior summary judgment order and remanded the case back to state court. ECF No. [85].

In the instant Motion for Fees and Bill of Costs, Plaintiff argues that it is entitled to attorneys' fees and costs because it is the prevailing party in this action due to improper removal.

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See generally ECF Nos. [91], [96]. Plaintiff sets forth two alternative bases for its entitlement to attorneys' fees. ECF No. [96] at 3-9.

First, Plaintiff contends it is entitled to attorneys' fees and costs, pursuant to Florida Statute Section 626.9373, because “Florida law provides that where an insured prevails against his or her insurer, ‘the trial court . . . shall adjudge or decree against the insurer and in favor of the insured or beneficiary a reasonable sum as fees or compensation for the insured's or beneficiary's attorney prosecuting the lawsuit for which recovery is awarded.'” Id. at 3 (quoting FLA. STAT. § 626.9373 (emphasis added)). Plaintiff contends that the provision applies regardless of whether the insured prevails on the merits. Id. at 3-4. Plaintiff cites to a variety of cases in support of its position. See id. at 3-7. Specifically, Plaintiff relies on Prime Insurance Syndicate, Inc. v. Soil Tech Distributors, Inc., 270 Fed.Appx. 962 (11th Cir. 2008), where “the district court dismissed a declaratory judgment action in favor of an insured for failure to satisfy the jurisdictional amount in controversy, and then awarded fees to the insured under Section 627.428.” Id. at 4 (citing Prime, 270 Fed.Appx. at 963). Although the insurer argued that the insured had to prevail on the merits in order to recover fees, the Eleventh Circuit rejected that argument, finding that the statute, by its own terms, “does not require an insured party to succeed on the merits of a case in order to recover attorney's fees.'” Id. (quoting Prime, 270 Fed.Appx. at 963).^[2] Additionally, Plaintiff contends that

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the fact that the merits of the action will eventually be adjudicated in state court “does not eliminate entitlement to fees under Section 626.9373.” Id. (citing Capitol Specialty Ins. Corp. v. Ortiz, No. 17-cv-23329, 2019 WL 383868, at *3 (S.D. Fla. Jan. 15, 2019) (hereinafter “Capitol Specialty Insurance”), report and recommendation adopted sub nom. Capitol Specialty Ins. Corp. v. Ortiz by & Through Corona, No. 17-cv-23329, 2019 WL 367916, at *1 (S.D. Fla. Jan. 30, 2019)).

Second, Plaintiff contends that it is also entitled to attorneys' fees and costs pursuant to 28 U.S.C. § 1447. Id. at 8-9. The federal statute allows for the recovery of attorneys' fees and costs where the removal lacked an “objectively reasonable basis.” Id. at 8 (citing Rae v. Perry, 392 Fed.Appx. 753, 756 (11th Cir. 2010); Devine v. Prison Health Servs., Inc., 212 Fed.Appx. 890 (11th Cir. 2006)). Plaintiff argues that Defendant Frontline's removal of this action to federal court was not “objectively reasonable” where it alleged it was a citizen of Illinois to remove the case, and then admitted in its Answer and Affirmative Defenses that its principal place of business was in Lake Mary, Florida. Id.

In its Response, Defendant first contends that “Treasure Cay is not entitled to attorneys' fees and costs per Florida Statute § 626.9373 because it is not the prevailing party, pursuant to a judgment or decree, as required by the statute” but “[r]ather, Treasure Cay's appeal of this Court's final judgment was dismissed and this case remanded to the state court for resolution by a joint motion of the parties.” ECF No. [97] at 1. Defendant argues that “the only judgment was in favor of Frontline, though it has since been vacated at the joint request of the parties.” Id. at 4. According to Defendant, the cases cited by Plaintiff are distinguishable, because each awarded attorneys' fees where the case was dismissed outright, resulting in one party prevailing. See id. at

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4-6. Specifically, “Treasure Cay has not cited any case wherein a remand to state court for lack of subject matter jurisdiction afforded attorneys' fees under Fla. Stat. §626.9373” but rather “[t]he only cases cited by Treasure Cay all state that the insured is entitled to attorneys' fees when the case was dismissed.” Id. at 5. Defendant notes that the instant action is distinguishable because there was not any judgment or decree and “[t]he parties have been placed in the same position as when the case was filed in state court.” Id. at 6. In response to Plaintiff's contention that Treasure Cay conferred a benefit as a result of the dismissal of the appeal, Frontline responds that “Treasure Cay did not receive any benefit because the parties are restored to their original positions and Treasure Cay has yet to receive the benefit of appraisal.” Id. at 7.

Second, as to Plaintiff's claim that it is entitled to fees under Section 1447, Defendant responds that attorneys' fees are not warranted for improper removal because Defendant's removal of the case was in good faith and was not objectively unreasonable. See id....