Filed: Jun. 03, 2019
Latest Update: Jun. 03, 2019
Summary: NOT FOR PUBLICATION MEMORANDUM OF DECISION RE: MOTION FOR CONTEMPT 1 [DOC. NO. 14] ERNEST M. ROBLES , Bankruptcy Judge . I. Background Facts At the above-captioned date, time and place, the Court held a hearing on Andrea Michel's (the "Debtor") Motion for Contempt Against Michael's Superstore Abaud, Inc., for Their Intentional Violation of: The Bankruptcy Automatic Stay [and] the Rosenthal Fair Debt Collection Practices Act [Doc. No. 14] (the "Motion for Contempt"). Appearances were a
Summary: NOT FOR PUBLICATION MEMORANDUM OF DECISION RE: MOTION FOR CONTEMPT 1 [DOC. NO. 14] ERNEST M. ROBLES , Bankruptcy Judge . I. Background Facts At the above-captioned date, time and place, the Court held a hearing on Andrea Michel's (the "Debtor") Motion for Contempt Against Michael's Superstore Abaud, Inc., for Their Intentional Violation of: The Bankruptcy Automatic Stay [and] the Rosenthal Fair Debt Collection Practices Act [Doc. No. 14] (the "Motion for Contempt"). Appearances were as..
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NOT FOR PUBLICATION
MEMORANDUM OF DECISION RE: MOTION FOR CONTEMPT1
[DOC. NO. 14]
ERNEST M. ROBLES, Bankruptcy Judge.
I. Background Facts
At the above-captioned date, time and place, the Court held a hearing on Andrea Michel's (the "Debtor") Motion for Contempt Against Michael's Superstore Abaud, Inc., for Their Intentional Violation of: The Bankruptcy Automatic Stay [and] the Rosenthal Fair Debt Collection Practices Act [Doc. No. 14] (the "Motion for Contempt"). Appearances were as stated on the record.2
As set forth in the Court's Tentative Ruling [Doc. No. 18], incorporated herein by reference, the Court found that the Debtor was entitled to an award of damages against Michael's Superstore Abaud, Inc. ("Creditor") for the attorney's fees and costs that Debtor incurred to halt Creditor's stay violating conduct and prosecute the Motion for Contempt3. However, the Court noted that the Debtor failed to submit any evidence of the amount of attorney's fees and costs incurred in support of the Motion for Contempt. Therefore, the Court directed the Debtor to "file and serve on Creditor a supplemental declaration from Debtor's counsel that attaches a billing statement for services performed in connection with (a) notifying Creditor and the Superior Court of the Debtor's bankruptcy filing and discharge of Creditor's debt and (b) bringing th[e Motion for Contempt]" by no later than May 22, 2019. Id. The Court also set a May 29, 2019 deadline for Creditor to object to the reasonableness of the requested fees and costs and stated that the matter would be deemed submitted as of May 29, 2019. Id.
On May 22, 2019, the Debtor timely filed a Memorandum in Support of Attorney's Fees and Costs [Doc. No. 19] (the "Fee Application") seeking $3,623.00 in fees and $273.60 in costs for a total award of $3,896.60 as follows:
Date Description Hours Staff Rate Amount
3/13/2019 Telephone call with Debtor & email 0.3 Scott $120.00 $36.00
regarding summons and credit reports Ziegler Paralegal
3/14/2019 Retrieved and reviewed credit reports 0.75 Scott $120.00 $90.00
with Debtor Ziegler Paralegal
3/14/2019 Drafted letters to Michael's Superstore 0.75 Ryan $120.00 $90.00
& Superior Court Davis Paralegal
3/14/2019 Cost to mail letters to Michael's N/A N/A N/A $13.60
Superstore & Superior Court via
certified mail
3/14/2019 Telephone call with Debtor to review 1 Jared $350.00 $350.00
and gather facts/documentation Ahern Attorney
3/25/2019 Telephone call with Debtor regarding 0.2 Lauren $350.00 70.00
the hearing for Michael Superstores v. Rodkey Attorney
Michel on 3/26/19
3/25/2019 Draft Ex-Parte Application to Reopen 3 Jared $300.00 $900.00
Case, Motion for Contempt, Ahern Attorney
Declaration and proposed order
3/25/2019 Fee to reopen Case # 2:18-bk-23311-ER N/A N/A N/A $260.00
3/25/2019 Cost for service of Motion to Reopen N/A N/A N/A N/A
3/26/2019 Email exchange with Debtor regarding 0.1 Scott $120.00 $12.00
outcome of the hearing for Michael Ziegler Paralegal
Superstores v. Michel
5/10/2019 Prepare draft of fee application 0.5 Lauren $350.00 $175.00
Rodkey Attorney
5/13/2019 Draft fee application and declarations 4.75 Brian $400.00 $1,900.00
Brazer Attorney
5/13/2019 Anticipated expense for hearing on fee ?? Attorney $350.00
application
11.35 $3,896.60
As of the date of entry of this Memorandum of Decision, Creditor has not filed an objection.
II. FINDINGS AND CONCLUSIONS
Attorneys' fees and costs are a mandatory component of the § 362(k)(1) remedy and encompass fees reasonably incurred in prosecuting a damages action for automatic stay violation. America's Servicing Co. v. Schwartz-Tallard (In re Schwartz-Tallard), 803 F.3d 1095, 1099-1101 (9th Cir. 2015) (en banc). However, "[o]nly an award of fees reasonably incurred is mandated by the statute; courts awarding fees under § 362(k) thus retain the discretion to eliminate unnecessary or plainly excessive fees." Id. at 1101 (citing In re Dawson, 390 F.3d 1139, 1152 (9th Cir. 2004).
In this case, the Court finds that the fees incurred for the services performed from March 13, 2019 through March 26, 2019 totaling $1,548 and $273.60 in costs are reasonable and appropriate damages stemming from Creditor's stay violation. However, the Debtor's request for $2,075 in fees for services performed on May 13, 2019 to draft the Fee Application and declarations are unwarranted and unreasonable for several reasons.
First, the Court finds these fees unwarranted because the Court's Tentative Ruling did not authorize the Debtor to include fees for time spent preparing and filing the supplemental declaration attaching counsel's billing statements. The Tentative Ruling stated:
Therefore, by no later than May 22, 2019, the Debtor is directed to file and serve on Creditor a supplemental declaration from Debtor's counsel that attaches a billing statement for services performed in connection with (a) notifying Creditor and the Superior Court of the Debtor's bankruptcy filing and discharge of Creditor's debt and (b) bringing this motion . . . The Court will not entertain any argument or evidence from either party beyond the scope of the appropriate amount of attorney's fees and costs the Debtor is entitled to.
Tentative Ruling, Doc. No. 18.
The Tentative Ruling limited fees to the two categories described above and made no mention of a fee application or memorandum of points and authorities. The Court acknowledges that the last sentence of the Tentative Ruling could be read as an invitation to submit briefing on the reasonableness of counsel's fees, but that was not the Court's intention. The Court clearly stated that all that was required was a supplemental declaration that attached a billing statement.
Second, the Court finds that the Debtor's request for reimbursement of $2,075 in fees for time spent preparing the Fee Application are plainly excessive, especially in relation to the amount of underlying fees sought to end the stay violation. As noted above, the Debtor should have included counsel's billing statements in support of the Motion for Contempt. However, rather than denying the Debtor's request for damages outright for failure to carry her evidentiary burden of proof, the Court instead permitted the Debtor an opportunity to submit evidence of damages. Therefore, the Court does not believe it is appropriate to reward counsel for its failure to file the required evidence in support of the Motion for Contempt.
The Court also finds it unreasonable to award the Debtor fees for the unnecessary time spent briefing this Court on the applicable standard for considering the reasonableness of attorneys' fees or the appropriate rate for an attorney practicing in the Central District of California since this Court is already abundantly familiar with those standards and rates. Additionally, the Fee Application has no explanation for why the firm had two different paralegals and three different attorneys working on this relatively simple matter or how much unnecessary time it wasted bringing each new paralegal and attorney up to speed.
Therefore, the Court will not award the Debtor any fees for time spent preparing the Fee Application.
III. CONCLUSION
For the foregoing reasons, the Court awards the Debtor $1,548 in fees and $273.60 in costs for a total damages award of $1,821.60 arising from Creditor's violation of the automatic stay pursuant to 11 U.S.C. § 362(k). The Court will enter an order consistent with this Memorandum of Decision.
