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Schueller v. Wells Fargo & Company

United States District Court, D. New Mexico

June 12, 2018



         THIS MATTER is before the Court on Wells Fargo Bank, N.A.’s Motion for Attorney’s Fees (Doc. 39) filed on April 9, 2018. Having considered the record, submissions of counsel, and relevant law, the Court finds that Defendant’s motion should be granted in part.[1]

         I. Procedural History

         District Judge Marth Vazquez laid out the full procedural and factual background of this matter in her March 28, 2018 Memorandum Opinion and Order (see Doc. 36 at 1-7), and I will recite only those facts relevant to the motion at issue here.

         2011 Lawsuit

         Plaintiff filed his first lawsuit against Wells Fargo & Company (Wells Fargo) in 2011 in federal court. Id. at 2; see also Schueller v. Experian Info. Sols., Inc., et al., No. 11-cv-00955 MCA/LFG, Compl. (D.N.M. Oct. 25, 2011). Plaintiff asserted several claims against Wells Fargo in the 2011 lawsuit, including defamation and conversion claims, as well as claims under the Fair Credit Reporting Act (FCRA). See Doc. 36 at 2. Plaintiff alleged that Wells Fargo had unlawfully and fraudulently continued to withdraw money from Plaintiff’s bank account for mortgage payments for certain real property, even after Plaintiff’s personal liability for the mortgage was discharged during 2010 bankruptcy proceedings. See Id. at 1-2.

         On July 30, 2012, the court granted Wells Fargo’s motion to dismiss. See Id. at 2. “[T]he Court explained that Plaintiff’s bankruptcy discharge only discharged his personal liability for the debt, not the mortgage lien . . . .” Id. at 3. Because the bankruptcy discharge included an explanation that Plaintiff could opt to “voluntarily pay any debt that [had] been discharged[,]” and because there was evidence that Wells Fargo withdrew the payments “from Plaintiff’s bank account at his direction[,]” Plaintiff had failed to state a claim for conversion. Id. at 3-4. The court found, however, that because there was a chance Plaintiff could allege additional facts to demonstrate that these payments were not voluntary, the claim should be dismissed without prejudice. Id. at 4. The court also held that the record did not support Plaintiff’s defamation or FCRA claims and dismissed those claims with prejudice. Id.

         Wells Fargo filed a motion for attorney’s fees and costs, which the court granted in part on March 27, 2013. See Schueller, No. 11-cv-00955, Mot. for Attys’ Fees & Costs (Aug. 29, 2012); Mem. Op. & Order (D.N.M. Mar. 27, 2013) (“2011 Schueller Mem. Op. & Order”). “The Court described Plaintiff as a ‘law-trained pro se litigant and frequent filer of various and sundry lawsuits . . . .’” Id. at 4 (quoting 2011 Schueller Mem. Op. & Order, at *1). The court held that Plaintiff’s 2011 lawsuit was frivolous, but it did not conclude that Plaintiff acted in bad faith. Id. at 4-5 (discussing 2011 Schueller Mem. Op. & Order, at *9). The court therefore declined to award fees to Wells Fargo up to the filing of the motion to dismiss. Id. at 5. After Plaintiff was apprised of the relevant law through Wells Fargo’s motion and the magistrate judge’s report and recommendation, however, Plaintiff “stubbornly, and without any legal basis for doing so, persisted in pursuing his claims in bad faith.” Id. (quoting 2011 Schueller Mem. Op. & Order, at *10). Thus, the court awarded Wells Fargo fees “from that point forward in replying to Schueller’s bad-faith response to the motion to dismiss . . . .” Id. (quoting 2011 Schueller Mem. Op. & Order, at *10). Plaintiff appealed to the Tenth Circuit, which upheld the district court’s decisions. See id.; see also Schueller v. Wells Fargo & Co., 559 F. App’x 733 (10th Cir. 2014). “Plaintiff filed a petition for writ of certiorari to the United States Supreme Court, which was denied on October 6, 2014.” Doc. 36 at 6 (citing Schueller v. Wells Fargo & Co., 135 S. Ct. 275 (2014)).

         2016 Lawsuit

         Undaunted, Plaintiff filed this lawsuit against Wells Fargo in state court on January 15, 2016, and Wells Fargo promptly removed the action to federal court. See Docs. 1; 1-1. As Judge Vazquez noted in her March 28, 2018 Memorandum Opinion and Order, Plaintiff’s 2016 claims “are based on the same conduct that was at issue in the 2011 Action . . . .” Doc. 36 at 6 (emphasis in original). Not surprisingly, then, Wells Fargo moved to dismiss on the basis “that Plaintiff’s claims are barred under the doctrine of res judicata, and that, even if res judicata does not apply, Plaintiff’s claims are subject to dismissal because he has failed to properly state a claim upon which relief can be granted for either defamation or conversion.” Id. at 8. Judge Vazquez ultimately found “that Plaintiff’s defamation claim is barred by claim preclusion” and dismissed it with prejudice. Id. at 11. Plaintiff failed to plead any additional facts to support his conversion claim, so Judge Vazquez dismissed that claim with prejudice as well. Id. at 12-14.

         Directly relevant to this motion, Judge Vazquez also granted Wells Fargo’s motion for Rule 11 sanctions. See Id. at 14-18. Wells Fargo asked for attorney’s fees and costs due to the fact that Plaintiff’s claims and legal theories were identical in both his 2011 and 2016 lawsuits. See Id. at 16. Noting that “Plaintiff has been on notice of the baselessness of his claims” at least since the award of fees in his 2011 lawsuit, Judge Vazquez found that “no ‘reasonable and competent attorney would believe in the merit’ of the arguments on which” Plaintiff bases his current lawsuit. Id. at 17 (quoting Dodd Ins. Servs., Inc. v. Royal Ins. Co. of Am., 935 F.3d 1152, 1155 (10th Cir. 1991) (internal citations omitted)). Thus, by “continuing to pursue the instant action, Plaintiff is in violation of Rule 11(b)” and the requested sanctions are proper. Id. at 18. Judge Vazquez directed “Wells Fargo to file an application for attorney’s fees and costs, including supporting affidavits and documentation,” which is now before the undersigned magistrate judge. See id.; Doc. 39.

         Motion for Attorney’s Fees

         Wells Fargo now seeks $24,584.06[2] in attorneys’ fees for 78.70 hours of legal services, $160 in paraprofessional fees for 1.60 hours of paraprofessional services, and $410 in costs to cover the filing fee. See Doc. 39-1 at 2-3; see also Doc. 39-1, Ex. 1, at 6-7. Plaintiff failed to file a response to Wells Fargo’s Motion for Attorney’s Fees, which pursuant to our District’s Local Rules “constitutes consent to grant the motion.” See D.N.M.LR-Civ. 7.1(b).

         II. Legal Standard

         “To determine the reasonableness of a fee request, a court must begin by calculating the so-called ‘lodestar amount’ of a fee, and a claimant is entitled to the presumption that this lodestar amount reflects a ‘reasonable’ fee.” Auge v. Stryker Corp., No. 14-CV-1089 KG/SMV, 2017 WL 4355974, at *1 (D.N.M. Sept. 28, 2017) (quoting Robinson v. City of Edmond, 160 F.3d 1275, 1281 (10th Cir. 1998) (internal citations omitted)). “The lodestar is ‘the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate,’ which produces a presumptively reasonable fee that may in rare circumstances be adjusted to ...

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