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New Mexico Oncology and Hematology Consultants, Ltd. v. Presbyterian Healthcare Services

United States District Court, D. New Mexico

November 5, 2018

NEW MEXICO ONCOLOGY AND HEMATOLOGY CONSULTANTS, LTD., Plaintiff,
v.
PRESBYTERIAN HEALTHCARE SERVICES, et al., Defendants.

          MEMORANDUM OPINION AND ORDER

          MARTHA VÁZQUEZ, UNITED STATES DISTRICT JUDGE.

         This matter comes before the Court pursuant to the Court's adoption (doc. 814) of the Magistrate Judge's Findings and Recommended Disposition (doc. 745), thereby ordering Defendants to pay Plaintiff 75% of the costs associated with its Motion for Sanctions (doc. 673), Plaintiff's Fee Affidavit seeking $629, 871.23 in costs (doc. 820), and Defendants' Objections to Plaintiff's Fee Affidavit (doc. 823). For the following reasons, the Court awards Plaintiff $499, 335.99.

         I. Background

         The procedural history in this case is extensive, and the Court only briefly recites those facts relevant to the instant issue here. On November 7, 2016, Plaintiff became concerned by Defendants' disclosures, expressed its concern to Defendants, and began to investigate potential discovery violations. Doc. 820 at 7.

         After months of thorough review and investigation, with significant assistance from experts, Plaintiff filed its Motion for Sanctions on May 17, 2017. Doc. 673. The Court held a hearing on the Motion on July 25, 2017, and heard oral argument on August 2, 2017. Docs. 732, 736. On August 16, 2017, in his Proposed Findings and Recommended Disposition, the Magistrate Judge recommended the following:

I find that Defendants' negligence resulted in many of the errors in producing ESI which caused Plaintiff to believe the instant motion to be necessary. . . .Therefore, I recommend that Defendants be ordered to pay Plaintiff 75% of the costs associated with its Motion for Sanctions (doc.673), [1] including all fees paid to expert witnesses to prepare reports and testify at the motion hearing.

Id. at 34.[2]

         The Court adopted the Magistrate Judge's Proposed Findings and Recommended Disposition, and overruled Plaintiff's Objections thereto on February 21, 2018, doc. 756, thereby ordering Defendants to pay Plaintiff 75% of the costs associated with its Motion for Sanctions. Doc. 814. In response, Plaintiff filed its Fee Affidavit on June 26, 2018, seeking $629, 871.23 in costs. Doc. 820. Defendants filed their objections to Plaintiff's Fee affidavit on July 6, 2018, requesting that Plaintiff's fee award be reduced to $61, 173.46. Doc. 823. The matter of the reasonableness of Plaintiff's Fee Affidavit is now before the Court.

         II. Legal Standard

         To determine reasonable attorney fees, the Court “must arrive at a ‘lodestar' figure by multiplying the hours plaintiffs' counsel reasonably spent on the litigation by a reasonable hourly rate.” Jane L. v. Bangerter, 61 F.3d 1505, 1509 (10th Cir. 1995) (citing Blum v. Stenson, 465 U.S. 886, 888 (1984)).[3] It is Plaintiffs' burden “to prove and establish the reasonableness of each dollar, each hour, above zero.” Mares v. Credit Bureau of Raton, 801 F.2d 1197, 1210 (10th Cir. 1986).

         “Counsel for the prevailing party should make a good faith effort to exclude from a fee request hours that are excessive, redundant, or otherwise unnecessary.” Hensley v. Exkerhart, 461 U.S. 424, 434 (1983). The Court should, therefore, exclude hours not “reasonably expended, ” and although “[t]here is no precise rule or formula for making these determinations[, t]he court necessarily has discretion in making this equitable judgment.” Id. at 434-437. Notably, “a district court does not abuse its discretion in reducing a plaintiff's fee request when the request is based on time records that are rather sloppy and imprecise.” Robinson v. City of Edmond, 160 F.3d 1275, 1284-85 (10th Cir. 1998). However, the district court may not merely “eyeball the fee request and cut it down by an arbitrary percentage.” Id. at 1281 (internal quotations and citations omitted).

         III. Analysis

         Defendants object to Plaintiff's fee affidavit on various grounds. Doc. 823. The Court will address each of these objections, in turn.

         A. The parameters of Plaintiff's fee award are limited to 75% of those costs and fees associated with Plaintiff's Motion for Sanctions.

         First, Defendants correctly highlight that Plaintiff is only entitled to recover “75% of the costs associated with its Motion for Sanctions, including all fees paid to expert witnesses to prepare reports and testify at the motion hearing.” Doc. 745 at 34; doc. 823 at 8. Here, even though Plaintiff only seeks to recover 75% of its attorney fees in its fee affidavit, Plaintiff nevertheless requests reimbursement of 100% of other costs. See doc. 820-7. Specifically, Plaintiff attempts to recover 100% of its costs related to contract work performed by Sam Joseph, in the amount of $99, 285.00. Id. In the same vein, Plaintiff seeks $301, 183.17 for its “other” costs, constituting 100% of the initial figure. Id. Defendants are specifically ordered to pay Plaintiff only 75% of its fees and costs, including those fees paid to experts. Meaning, all fees and costs that Plaintiff seeks to recover must be reduced to 75% of their original value, regardless of their origin. Therefore, after reducing the $99, 285.00 and $301, 183.17 amounts by 25%, equaling a $24, 821.25 and $75, 295.79 decrease, respectively, Plaintiff may only recover, at most, $529, 754.19, prior to considering Defendants' remaining objections, rather than the $629, 871.23 quantity that Plaintiff requests.

         B. Plaintiff is entitled to fees resulting from its investigatory work, including that performed by experts, which was precipitated by Defendants' negligence, and necessary to prepare its Motion for Sanctions.

         Second, Defendants contend that Plaintiff may not recover fees associated with its investigatory work, including contributions by experts, which led to its Motion for Sanctions. Doc. 823 at 8-11. In doing so, Defendants incorrectly conflate Plaintiff's right to recover fees related to its investigation of Defendants' alleged discovery violations in association with its Motion for Sanctions, and its right to recover fees related to discovery, generally.

         The Court held, in adopting the Magistrate Judge's Proposed Findings and Recommended Disposition, that Plaintiff was entitled to recover the former, but not the latter. See doc. 814. It determined that allowing recovery of such fees was in the interests of justice, because Plaintiff engaged in arduous and extremely costly analysis and research, including the hiring of experts, to investigate Defendants' alleged discovery violations, which it would not have performed, but for Defendants' negligence. See doc. 747 at 99 (“I can't imagine the undertaking [by] Mr. Sanders [of] cross-referencing and needing to figure out [if he was] missing complete documents. . . And I don't think that his concerns early on were taken particularly seriously.”).

         Further, because performance of such investigatory work was essential to Plaintiff's discovery of the information upon which Plaintiff's Motion for Sanctions is founded, fees resulting from this work are undoubtedly “associated with [Plaintiff's] Motion for Sanctions.” Because the Court has ordered Defendant to pay Plaintiff 75% of its “costs associated with its Motion for Sanctions, ” the Court finds that it is appropriate for Plaintiff to recover those fees ...


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