Trent v. Connor Enters., Inc.

• Decision Date: 16 October 2019
• Docket Number: A167572
• Citation: 452 P.3d 1072,300 Or.App. 165
• Parties: Gina TRENT, an individual, Plaintiff-Appellant, v. CONNOR ENTERPRISES, INC., a domestic corporation, dba Best Western New Oregon, Defendant-Respondent.
• Court: Oregon Court of Appeals

300 Or.App. 165

452 P.3d 1072

Gina TRENT, an individual, Plaintiff-Appellant,

v.CONNOR ENTERPRISES, INC., a domestic corporation, dba Best Western New Oregon, Defendant-Respondent.

A167572

Court of Appeals of Oregon.

Argued and submitted August 2, 2019.

October 16, 2019

David A. Schuck argued the cause for appellant. Also on the briefs were Stephanie J. Brown, Karen A. Moore, and Schuck Law, LLC.

Gregory T. Lusby, Eugene, argued the cause for respondent. Also on the brief were Ariana Denley and Arnold Gallagher P.C.

Before Armstrong, Presiding Judge, and Egan, Chief Judge, and Aoyagi, Judge.^*

AOYAGI, J.

Plaintiff brought this wage action against defendant, her former employer, under state and federal law. About ten months after plaintiff filed her original complaint, defendant made an offer to allow judgment in the amount of $2,500, pursuant to ORCP 54 E, which plaintiff accepted, resulting in a stipulated general judgment. Plaintiff thereafter requested attorney fees and costs under ORS 652.200(2) and 29 USC § 216(b). The trial court awarded costs, but it denied attorney fees on the basis that plaintiff had "acted unreasonably and in bad-faith" in the litigation and therefore was not entitled to an award under either statute. On appeal, plaintiff challenges the denial of attorney fees. Because we agree with plaintiff that the trial court misconstrued the fee statutes, we reverse and remand for further proceedings.

FACTS

The relevant facts are minimal and largely procedural. Historical facts are stated consistently with unchallenged factual findings by the trial court.

Plaintiff worked for defendant until November 2016, when her employment was terminated. On January 18, 2017, plaintiff’s counsel notified defendant of a $511.87 wage deficiency. A week later, on January 25, plaintiff filed a complaint in the circuit court alleging a state wage claim, which she later amended to add a federal wage claim. On January 27, without knowledge of the complaint, defendant mailed a check to plaintiff in the amount of $1,044.74. Plaintiff did not cash the check and, on January 30, authorized her attorney to proceed with the litigation. On March 20, defendant’s counsel initiated settlement discussions with plaintiff’s counsel, which continued, unsuccessfully, until November 14.

On November 14, defendant made an offer to allow judgment pursuant to ORCP 54 E. See ORCP 54 E (limiting attorney fees if a party does not accept a qualifying pretrial offer and then recovers less than the offer amount at trial). Specifically, defendant offered to allow judgment in plaintiff’s favor "in the sum of $2,500.00 to resolve all claims, including counterclaims, with costs, disbursements and/or attorney fees to be determined by the Court per ORCP 68." Plaintiff accepted the offer. The trial court entered a stipulated general judgment, awarding $2,500 to plaintiff and dismissing defendant’s counterclaims. As to costs, disbursements, and attorney fees, the general judgment states, "Yes, to be determined pursuant to ORCP 68."

After entry of the general judgment, plaintiff filed a statement of attorney fees and costs, seeking approximately $45,000 in fees and $733 in costs. The trial court ultimately awarded the requested costs, but it denied attorney fees on the basis that plaintiff had acted unreasonably and in bad faith. As relevant to the denial of fees, the trial court adopted written findings and conclusions, describing the history of the litigation and culminating with the following paragraph:

"Pursuant to ORS 652.200(2) and 29 USC § 216(b), the Plaintiff has acted unreasonably and in bad-faith resulting in the Plaintiff not being entitled to an award of attorney fees *** because Plaintiff failed to comply with the notice requirements,^{[1 ]} moved forward filing a suit on a theory that the Plaintiff had a prior violation of ORS 652.140 in the previous year when that was not true, [and] failed to accept the timely tendered check in the amount $1044.74 which would have amply covered the Plaintiff’s claim especially with the Plaintiff subsequently acknowledging in court filings that her wage claim totaled just $266.73 while Defendant acknowledged that any such wage computations errors were De Minimis and totaled only $27.29 which the timely check sent to Plaintiff’s counsel in the amount of $1044.74 more than covered. Thus, the Plaintiff shall not be awarded any attorney fees in this matter."

In so ruling, the trial court specifically rejected an alternative approach, which defendant had suggested, of concluding that plaintiff was statutorily entitled to attorney fees but awarding a reduced amount as a "reasonable" award based on the factors in ORS 20.075. ORS 20.075 sets out the various factors that a court must consider "in determining the amount of an award of attorney fees in any case in which an award of attorney fees is authorized or required by statute." As defendant pointed out, those factors include, among others, the objective reasonableness of the parties and the diligence of the parties and their attorneys during the proceedings, the objective reasonableness of the parties and their diligence in pursuing settlement, the novelty and difficulty of the legal issues, and the amount involved in the controversy and the results obtained. See ORS 20.075 (1)(e) - (f) ; ORS 20.075(2)(a), (d). The trial court rejected that portion of defendant’s proposed findings and conclusions.² Instead, it ruled that plaintiff was not "entitled" to attorney fees under ORS 652.200(2) or 29 USC § 216(b).

Plaintiff appeals the denial of attorney fees. In her first assignment of error, plaintiff asserts that the trial court erred by denying her attorney fees under 29 USC § 216(b).³ In her second assignment of error, plaintiff asserts that the trial court erred by denying her attorney fees under ORS 652.200(2). In her third assignment of error, plaintiff asserts that the trial court "abused its discretion" in denying her attorney fees because "there is no evidence in this record to support a finding that Plaintiff had knowledge of facts that rendered her attempts to settle this case unreasonable, in bad faith, or lacking in diligence."

We address each issue in turn. In doing so, we review the trial court’s "legal determinations with respect to entitlement to attorney fees for errors of law," and we review exercises of discretion for abuse of discretion. Johnson v. O’Malley Brothers Corp. , 285 Or. App. 804, 812, 397 P.3d 554, rev. den. , 362 Or. 300, 408 P.3d 1079 (2017) (quoting Barber v. Green , 248 Or. App. 404, 410, 273 P.3d 294 (2012) ).⁴

ATTORNEY FEES UNDER 29 USC § 216(b)

Under 29 USC § 216(b), when an employee is awarded judgment on a claim under sections 206 or 207 of the Fair Labor Standards Act (FLSA), the court "shall, in addition to any judgment awarded to the plaintiff or plaintiffs, allow a reasonable attorney’s fee to be paid by the defendant, and costs of the action." In this case, the trial court determined that plaintiff had "acted unreasonably and in bad-faith" in bringing and maintaining the action and, on that basis, concluded that plaintiff was not entitled to attorney fees under 29 USC § 216(b).

In her first assignment of error, plaintiff challenges that ruling, arguing that an award of attorney fees is mandatory under the FLSA. Because judgment was entered in her favor, plaintiff contends, "the trial court was required to award her reasonable attorney fees and costs and had no discretion to decline to do so." Defendant responds that plaintiff was not entitled to attorney fees because plaintiff did not "prevail" on her FLSA claim; because there was no determination that defendant "actually" violated 29 USC § 206 ; and because any violation of 29 USC § 206 was de minimis .

We agree with plaintiff that an award of reasonable attorney fees under 29 USC § 216(b) is mandatory, not discretionary. That is apparent from the face of the statute and is not seriously in dispute. See 29 USC § 216(b) (the court "shall" award a reasonable attorney’s fee and costs); Newhouse v. Robert’s Ilima Tours, Inc. , 708 F.2d 436, 441 (9th Cir 1983) ("The FLSA grants prevailing plaintiffs a reasonable attorney’s fee."). In the trial court, defendant argued that plaintiff nonetheless was not entitled to attorney fees because of a "bad-faith exception" to fee awards under 29 USC § 216(b). Defendant does not reprise that argument on appeal.⁵ Instead, defendant makes new arguments, as described above, which it did not make to the trial court and on which the trial court did not rely in reaching its decision.

We may affirm a trial court ruling on an alternative basis that was not raised in the trial court when certain conditions are met. Outdoor Media Dimensions Inc. v. State of Oregon , 331 Or. 634, 659, 20 P.3d 180 (2001). However, our consideration of such alternative bases for affirmance "is a matter of prudential discretion and not compulsion." Biggerstaff v. Board of County Commissioners , 240 Or. App. 46, 56, 245 P.3d 688 (2010). In this case, we decline to exercise our discretion to consider the alternative bases to affirm, even assuming the predicate conditions are met.

As a preliminary matter, defendant has not asked us to exercise our discretion and, consequently, has not explained why it is appropriate to do so here. Further, based on the existing briefing, defendant has not persuaded us that any of its alternative arguments are meritorious, and we decline to try to develop arguments ourselves that were not made to the trial court, that have not been briefed sufficiently to persuade us of their merit, and that raise potentially complicated issues. See Biggerstaff , 240 Or. App. at 56, 245 P.3d 688 (failure to raise an issue in the trial court may "militate against" our considering it, even when the issue is purely legal, especially if it presents a substantial legal issue); see also WaterWatch of Oregon v. Water Resources Dept. , 268 Or. App. 187, 213, 342...