The opinion of the court was delivered by: DENNIS CAVANAUGH, District Judge
THE ORIGINAL OF THIS LETTER OPINION-ORDER IS ON FILE WITH THE
CLERK OF THE COURT
This matter comes before the Court upon an application for
attorneys' fees for the legal services provided pursuant to the
Order of June 28, 2005, wherein this Court appointed David
Samson, Esq., as the Substitute Employer-Trustee of the Laborers'
International Union of North America Local 734 Pension Fund and
the Laborers' International Union of North America Local 734
Welfare and Educational Fund ("the Funds"). After reviewing the
papers submitted on this matter and the objections thereto, the
request for attorneys' fees is granted.
On April 7, 2005, this Court issued an Order restraining Louis
Calastro, Salvatore Salerno, and Peter Rizzo ("Defendants"), from
participating in the operation and administration of the Funds.
The Court appointed David Samson, a partner of the law firm Wolff
& Samson, PC, as the substitute Employer-Trustee of the Funds. Mr. Samson served
as the substitute Employer-Trustee for the period running from
April 7, 2005, until he was discharged on June 28, 2005. He now
seeks payment for the legal services he and his law firm rendered
during that time. In total, he is requesting $88,300.72.
Defendants argue that many of the services performed by Mr.
Samson were outside the scope of his duties as Employer-Trustee.
Michael Rosado and Joseph Gambardella, two participants of the
Funds, allege that many of the services provided by Mr. Samson
and his law firm were unreasonable and that his fee application
should be reduced accordingly.
The Employment Retirement Income Security Act ("ERISA"),
29 U.S.C. § 1106(a)(1)(C) prohibits a fiduciary from engaging in
transactions if he knows or should know that such a transaction
will result in the "furnishing of goods, services, or facilities
between the plan and a party in interest." An exception to this
rule exists under Section 1108(b)(2), which allows fiduciaries to
contract or make arrangements with an interested party for legal
services, provided the services are necessary for the
establishment or operation of the plan and the compensation for
the services is reasonable.
This Court found that Mr. Samson's services were necessary to
the operation of the Funds on June 28, 2005, when he was
appointed as the substitute Employer-Trustee, as requested by
counsel for the Plaintiff. The issue now before this Court is
whether the attorney fees requested by Mr. Samson are reasonable.
The District Court employs its discretion to fix the amount of
attorney fees and expenses. In re Gen. Motors Corp. Pick-Up
Truck Prods. Liab. Litig., 55 F.3d 768, 783, 821 (3d Cir. 1995) (citing Lindy Bros. Builders, Inc. v. Am. Radiator & Std.
Sanitary Corp. 540 F.2d 102, 115 (3d Cir. 1976)). There is no
exact method though for determining an appropriate award. In re
Computron Software, Inc., 6 F. Supp. 2d 313, 321 (D.N.J. 1998).
Rather, the facts of each case must be considered in order to
determine the amount of any award. Id.
One of the methods used to determine the reasonableness of
attorneys' fees is the lodestar method. The lodestar method is
calculated by multiplying the number of hours reasonably expended
by a reasonable hourly rate. Lindy Bros. Builders, Inc. v. Am.
Radiator & Std. Sanitary Corp., 487 F.2d 161, 167 (3d Cir.
1971). The lodestar method is presumed to yield a reasonable fee.
Washington v. Philadelphia Court of Common Pleas, 89 F.3d 1031,
1035 (3d Cir. 1996) (citations omitted). Where excellent results
have occurred, the attorney should recover a fully compensatory
fee. Blum v. Stenson, 465 U.S. 886, 901 (1984). This will
normally include compensation for all hours reasonably expended
during the litigation, and in some cases of exceptional success
an enhanced award may be justified. Id.
A. Standard for Evaluating Reasonableness of Hours Charged
In order to determine the reasonableness of attorneys' fees,
the Third Circuit has explained that district courts should
"review the time charged, decide whether the hours set out were
reasonably expended for each of the particular purposes described
and then exclude those that are excessive, redundant, or
otherwise unnecessary." Public Interest Research Group v.
Windall, 51 F.3d 1179, 1188 (3d Cir. 1995). When a defendant
challenges the number of hours as being excessive, courts
frequently look at two factors to guide the assessment of
reasonableness whether such charges would be billed to a
fee-paying client and what the opposing party did in the same
case. In re Fine Paper Antitrust Litig., 751 F.2d 562, 587 (3d
Cir. 1984); Lenard v. Argento, 808 F.2d 1242, 1245 (7th Cir. 1987); Jordan v. CCH, Inc.,
230 F. Supp. 2d 603, 611 (E.D. Pa. 2002).
In Bell v. United Princeton Properties, Inc., 884 F.2d 713
720 (3d Cir. 1989), the Court held that the opposing party has
the burden of challenging the reasonableness of a fee application
with sufficient specificity as to give the applicant notice and
an opportunity to respond. Specifically, the Third Circuit
[A] court may not sua sponte reduce the amount of
the award when the defendant has not specifically
taken issue with the amount of time spent or the
billing rate, either by filing affidavits, or in most
cases, by raising arguments with specificity and
clarity in briefs. . . . It bears noting that the
district court retains a great deal of discretion in
deciding what a reasonable fee award is, so long as
any reduction is based on objections raised by the
adverse party. . . . [T]he adverse party's
submissions cannot merely allege in general terms
that the time spent was excessive. In order to be
sufficient, the briefs or answers challenging the fee
request must be clear in two respects. First, they
must generally identify the type of work being
challenged, and second, they must specifically state
the adverse party's grounds for contending that the
hours claimed in that area are unreasonable. The
briefs must be specific and clear enough that the fee
applicants have a fair chance to respond and defend
Id. (internal citations omitted).
The Third Circuit further explained in Rode v. Dellarciprete,
892 F.2d 1177, 1187 (1990), that based on challenges raised by
the adverse party, the district court must "explain why it
concludes hours expended on a task are excessive" and must
"specify the number of hours that would be reasonable and why
those hours would be reasonable." It also reiterated that "[t]he
district court cannot decrease a fee award based on factors not
raised by the adverse party." Id. at 1183. The Third Circuit
advised that the district courts should first examine the amount
of hours spent by the attorneys. Lindy Bros. Builders, Inc.,
487 F.2d at 167. The district court is not required to know the
exact number of minutes spent by each attorney, or the precise
activity each hour ...