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Gail A. Connor v. Sedgwick Claims Management Services

UNITED STATES DISTRICT COURT DISTRICT OF NEW JERSEY


December 17, 2012

GAIL A. CONNOR, PLAINTIFF,
v.
SEDGWICK CLAIMS MANAGEMENT SERVICES, INC., ET AL., DEFENDANTS.

The opinion of the court was delivered by: Hillman, District Judge

OPINION

Currently pending before the Court is Plaintiff's Motion for Reconsideration [Doc. No. 53] of this Court's prior Opinion and Order entered on February 23, 2012. [Doc. Nos. 51 & 52.] For the reasons that follow, Plaintiff's Motion will be granted.

I. FACTUAL AND PROCEDURAL BACKGROUND

The facts of this case are familiar to all relevant parties and the Court, and are detailed in the Court's prior Opinions.

[See Doc. Nos. 38, 39, 51, & 52.] The Court therefore only discusses the facts and procedural history relevant to the instant Motion.

On June 24, 2011, the Court entered an Order granting in part and denying in part Plaintiff's Motion for Summary Judgment. [Doc. No. 39.] Based on the partial success of her Motion, Plaintiff thereafter filed a Motion for Attorneys' Fees, requesting an award of 185.25*fn1 hours at the rate of $375.00 per hour, for a total of $69,468.75, plus costs in the amount of $350.00. [Doc. Nos. 42 & 50.] On February 23, 2012, the Court entered an Order which granted Plaintiff's request for attorneys' fees, but reduced the overall amount of the award. [Doc. No. 52.] More specifically, the Court found that Plaintiff's counsel's claimed hourly rate of $375.00 did not reflect the prevailing market rate in southern New Jersey. As such, the Court set counsel's hourly rate at $250.00 - an amount more indicative of the prevailing rates in the southern New Jersey region. The Court further reduced Plaintiff's counsel fee by ten percent (10%) for time spent litigating unsuccessful claims. Finally, the Court also deducted from the total amount 14.75 hours spent by Plaintiff's counsel on clerical tasks, and 73.50 hours spent on work that should have been delegated to a paralegal or associate paid at a lower rate. With regard to the latter, the Court determined that the accepted hourly rate of an associate attorney in southern New Jersey is $150.00, and the accepted rate of a paralegal is $85.00. Based on these rates, the Court applied a blended rate of $117.50 to the 73.50 hours that Plaintiff's counsel should have delegated to an associate or paralegal. The Court thereafter applied the "Lodestar Formula" to find the reasonable attorney fee amount due in this case, finding as follows:

As stated above, the reasonable hourly rate to be applied for plaintiff's counsel is $250 per hour. The 14.75 hours spent on clerical tasks will be deducted, and the 73.5 hours that should have been delegated will be deducted leaving a total number of attorney hours of 97 (185.25 -88.25 = 97). Thus, the lodestar for plaintiff's counsel is now $250 multiplied by 97, or $24,250. Added to this amount will be the time deemed to have been delegated to a paralegal/associate in the amount of $8,636.25, for total fees in the amount of $32,886.25. Subtracted from this amount will be the 10% reduction for litigation of unsuccessful claims resulting in a final fee amount of $29,597.62. There is no disagreement over the request for filing fees in the amount of $350 which will be added to the lodestar for total of award of $29,947.62.

[Doc. No. 51.] The Court entered an Order on February 23, 2012 awarding Plaintiff's counsel fees in the amount of $29,947.62. [Doc. No. 52.] Plaintiff then filed a motion seeking reconsideration of that Order on the grounds that the attorneys' fee award applied by the Court was erroneous.*fn2 [Doc. No. 53.]

II. STANDARD OF REVIEW

The Federal Rules of Civil Procedure do not expressly recognize motions for reconsideration. See Harrison v. Smith, No.Civ.A.08-3050, 2010 WL 715666, at *2 (D.N.J. Feb. 24, 2010) (citing United States v. Compaction Sys. Corp., 88 F.Supp.2d 339, 345 (D.N.J. 1999)). Generally, such motions are treated as motions to alter or amend the judgment of the court pursuant to Rule 59(e), or as motions for relief from the court's judgment and/or order under Rule 60(b). See Harrison, 2010 WL 715666 at *2. In the District of New Jersey, motions for reconsideration are governed by Local Civil Rule 7.1(i). Bowers v. Nat'l Collegiate Athletics Assoc., 130 F.Supp.2d 610, 612 (D.N.J. 2001). That rule provides, in relevant part, as follows:

[A] motion for reconsideration shall be served and filed within 14 days after the entry of the order or judgment on the original motion by the Judge. . . . A brief setting forth concisely the matter or controlling decisions which the party believes the Judge . . . has overlooked shall be filed with the Notice of Motion.

L.R. 7.1(i).

A motion for reconsideration is "a device to relitigate the original issue decided by the district court, and [it is] used to See Levy v. Global Credit & Collection Corp., No. Civ.A.10-4229, 2011 WL 5117855, at *4 (D.N.J. Oct. 27, 2011) (Kugler, J.) (citing Smith v. Phila. Hous. Auth., 107 F.3d 223, 225 (3d Cir. 1997) ("If hourly rates are disputed, the district court must conduct a hearing to determine the reasonable market rates.")). In the instant case, the Court held a hearing on this matter on November 15, 2012. [See Doc. No. 65.] allege legal error." Dermo v. Isaacson, No. Civ.A.11-06520, 2012 WL 4207179, at *1 (E.D. Pa. Sept. 19, 2012) (internal citations and quotation marks omitted). In order to prevail on a reconsideration motion, the movant has the burden of demonstrating one of the following:

(1) an intervening change in the controlling law; (2) the availability of new evidence that was not available when the court [issued its order]; or (3) the need to correct a clear error of law or fact or to prevent manifest injustice.

Max's Seafood Cafe v. Quinteros, 176 F.3d 669, 677 (3d Cir. 1999)(citing N. River Ins. Co. v. CIGNA Reins. Co., 52 F.3d 1194, 1218 (3d Cir. 1995)). The standard for reargument is considerably high, and such motions are to be granted only sparingly. See Dermo, 2012 WL 4207179 at *2; Harrison, 2010 WL 715666 at *2.

Thus, a party's difference of opinion with the court's decision should be dealt with through the normal appellate process. Bowers, 130 F.Supp.2d at 612 (citations omitted); Florham Park Chevron, Inc. v. Chevron U.S.A., Inc., 680 F.Supp. 159, 162 (D.N.J. 1988); see also Chicosky v. Presbyterian Med. Ctr., 979 F.Supp. 316, 318 (D.N.J. 1997); NL Indus., Inc. v. Comm. Union Ins. Co., 935 F.Supp. 513, 516 (D.N.J. 1996) ("Reconsideration motions . . . may not be used to re-litigate old matters, or to raise arguments or present evidence that could have been raised prior to the entry of judgment."). In other words, "[a] motion for reconsideration should not provide the parties with an opportunity for a second bite at the apple." Tishcio v. Bontex, Inc., 16 F.Supp.2d 511, 532 (D.N.J. 1998) (internal citation omitted).

III. DISCUSSION

Plaintiff avers that the Court erred in its prior Opinion by incorrectly holding her counsel to the $250.00 hourly rate of an attorney in southern New Jersey, rather than the $375.00 hourly rate of an attorney in northern New Jersey, where her counsel is located. Plaintiff further argues that the Court reclassified 73.50 hours of time as work that should have been delegated to a paralegal or associate, even though no objection was raised by the Defendant on this point. Plaintiff therefore requests that the Court reconsider its prior attorneys' fee award with respect to:

(1) the proper hourly rate for her attorney located in northern New Jersey; and (2) the hours that the Court found should have been delegated. The Court considers each argument in turn below.

A. Hourly Rate for the Relevant Community

Plaintiff's initial allegation is that the Court erred when it utilized the standard $250.00 hourly rate of an attorney in southern New Jersey in its reasonable attorney fee determination. More specifically, Plaintiff's counsel avers as follows: "Neither party had asked that southern New Jersey rates apply. The court, however, did so sua sponte because Camden, New Jersey was the site of the forum and because my office was thought to be in southern New Jersey." (Pl.'s Mot. Recon. at 3.)

The party requesting attorneys' fees has the burden of proving that its request is reasonable. Rode v. Dellarciprete, 892 F.2d 1177, 1183 (3d Cir. 1990). To meet this burden, the party must submit to the court evidence depicting the hours worked and the rates claimed. Id. (citing Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)). On the other hand, opposing counsel may challenge the fee request as unreasonable through the submission of sufficiently specific affidavits and briefs. Rode, 892 F.2d at 1183 (citing Bell v. United Princeton Prop., Inc., 884 F.2d 713 (3d Cir. 1989)); see also Interfaith Cmty. Org. v. Honeywell Int'l, Inc., 426 F.3d 694, 713 (3d Cir. 2005). In assessing whether the requested fee is reasonable, the district court may not decrease an award based on factors not at all raised by the other party. Rode, 892 F.2d at 1193 (internal citations and quotation marks omitted). If the adverse party has adequately challenged the fee request, however, "the district court has a great deal of discretion to adjust the fee award in light of those objections." Id. (internal citation omitted).

"Generally, a reasonable hourly rate is to be calculated according to the prevailing market rates in the relevant community." Id. (citing Blum v. Stenson, 465 U.S. 886, 895 (1984)). "Thus, the court should assess the experience and skill of the prevailing party's attorneys and compare their rates to the rates prevailing in the community for similar services by lawyers of reasonably comparable skill, experience, and reputation." Id. (internal citations omitted). Notably, the applicable market is the community where the forum court presides, and not where the individual lawyer's office is located. See Interfaith Cmty., 426 F.3d at 705 (3d Cir. 2005);*fn3 Avera v. Sec. of Health & Human Servs., 515 F.3d 1343, 1348-49 (Fed. Cir. 2008)(applying District of Columbia rate where court was located and rejecting market rate of the geographic location where the attorney maintained an office); Apple Corps. Ltd. v. Int'l Collectors Soc., 25 F.Supp.2d 480, 494 (D.N.J. 1998) (Greenaway, J.) (declining to apply New York City rate where attorneys' offices were located, and instead applying "forum rule" dictating that the relevant market is the place where the case was litigated).

In this case, although it is a close call, the Court finds that defense counsel's initial objection to Plaintiff's requested hourly rate was sufficiently specific. In their initial Response in Opposition to Plaintiff's Motion for Attorneys' Fees [Doc. No. 47], Defendants objected to Plaintiff's requested $375.00 rate on the grounds that "[i]t is well established [] that the Third Circuit follows the 'forum rate rule[.]'" (Def.'s Resp. Opp'n at 12.) The Third Circuit Court of Appeals has clearly defined the "forum rate rule" to be "the prevailing rate in the forum of the litigation." Interfaith Cmty., 426 F.3d at 705. In this case, the forum of the litigation was Camden, New Jersey, located in southern New Jersey. Although defense counsel did not explicitly state that a southern New Jersey rate should apply here, it clearly objected to Plaintiff's proposed rate for similarly situated practitioners in and around the New York City metropolitan area (i.e., northern New Jersey), and argued that the proper forum was the District of New Jersey. The proper forum here was the District of New Jersey - specifically, the District's Camden vicinage.*fn4

Moreover, defense counsel also articulated that a reasonable hourly rate "for an experienced practitioner in ERISA or federal litigation is roughly [between] $225.00 and $250.00" - the average hourly rate associated with attorneys in southern New Jersey. (Def.'s Resp. Opp'n at 12.) While defense counsel did not expressly state that this is the standard rate of an attorney in southern New Jersey, its intention was clear when reading this point in the context of the overall objection.

Furthermore, as noted by the Court at the November 15th hearing, all parts of the underlying Complaint and litigation took place in southern New Jersey. Plaintiff is a resident of Sewell, New Jersey. The gravamen of her grievances stem from her prior employment at the defendant's Haddonfield, New Jersey branch office. She filed her Complaint with this Court in Camden, New Jersey. All briefing was submitted to this Court, and all hearings and conferences took place in Camden as well. Sewell, Haddonfield, and Camden are all located in what could fairly be referred to as southern New Jersey. Based on the above considerations, the Court held that Plaintiff's counsel should be held to the reasonable hourly rate of an attorney here in southern New Jersey - $250.00.*fn5

Plaintiff further avers that there is no recognized rate in southern New Jersey. To support her argument, Plaintiff relies on Tenafly Eruv Association, Inc. v. Borough of Tenafly, 195 F. App'x. 93 (3d Cir. 2006). Tenafly, however, is inapposite here. The issue presented in that case was not whether a southern New Jersey rate should apply. Rather, in assessing whether the requested attorney rates were reasonable, the Third Circuit considered "the norm [rate] of New Jersey attorneys with similar positions at top New Jersey law firms in late 2002[.]" Id. at 97. Given that the litigation took place in New Jersey, the Third Circuit held that New Jersey rates - rather than New York City or Washington D.C. where other counsel was located - should apply. Id. In fact, the parties did not dispute that the relevant community was the State of New Jersey. Id. at 96, n.1 ("The parties agree that the "relevant community" in this case is the State of New Jersey.") (further citation omitted). As such, Tenafly in no way stands for the proposition that there is no recognized rate of attorneys in southern New Jersey.

Similarly, Plaintiff's reliance on Public Interest Research Group of New Jersey, Inc. v. Windall, 51 F.3d 1179(3d Cir. 1995) is likewise misplaced. In Windall, the Third Circuit chose not to disturb the district court's ruling to apply a statewide market rate for New Jersey. Id. at 1187. The district court in Windall sat in Trenton, New Jersey - a vicinage located in central New Jersey, and which encounters lawyers from both the northern and southern regions of the state. Id. Application of a state-wide rate was therefore appropriate because, as the Third Circuit noted, few southern New Jersey law firms were available and willing to represent the plaintiff. Id. In contrast to Windall, there is no credible evidence present here that southern New Jersey law firms were unwilling to take on Plaintiff's representation.*fn6

Furthermore, Plaintiff also alleges that "[a]s further evidence that there is no southern New Jersey rate[,] Judge Kugler used the Philadelphia rate for South Jersey in Levy v. Global Credit & Collection Corp., No. Civ.A.10-4229, 2011 WL 5117855 (D.N.J. Oct. 27, 2011)." (Pl.'s Mot. Recon. at 5 (citation format altered).) Plaintiff's citation to Levy for this proposition, however, is incorrect. In Levy, Judge Kugler, a United States District Court Judge in this vicinage, considered five different factors in his determination of whether or not an attorneys' fee award was reasonable.*fn7 Id. at *3. Notably, none of these factors entailed an inquiry into whether "the relevant community" was Philadelphia or southern New Jersey. In fact, the opinion makes no reference to "the relevant community" whatsoever. Rather, Judge Kugler merely stated that the source of the hourly rates proposed by the defendant - the CLS fee schedule*fn8 - was previously found by our sister court in the Eastern District of Pennsylvania to be "a fair reflection of the prevailing market rates in Philadelphia." Id. at *4. In the instant case, neither party relies upon the CLS fee schedule. As such, Levy is inapplicable here.

Therefore, the Court declines to alter its initial finding that the applicable hourly rate of an attorney in this litigation is $250.00. The $250.00 hourly rate is not - as Plaintiff contends - a "penalized rate," but rather is reflective of the degree of skill exercised in this type of case in this particular community. As such, the Court reaffirms that part of its initial holding.

B. Paralegal Time

Plaintiff also asks the Court to reconsider its prior findings with respect to the time her counsel spent on tasks that could have been delegated to a paralegal or legal assistant. In its initial Response in Opposition [Doc. No. 47], defense counsel was unclear as to the scope of its objection on this point. For example, counsel first alleged that: "Plaintiff's Motion seeks to recover for an astonishing 26.0 hours . . . for work spent doing clerical or routine tasks that, even if handled by a paralegal or legal assistant, should have been completed in a much more efficient manner." (Def.'s Resp. Opp'n at 13.) After listing a several examples that Defendant considered to be clerical tasks, it then stated: "Therefore, Defendant requests that the Court . . . subtract 19.25 hours from Plaintiff's counsel's total hours." (Id. at 14.) Furthermore, Defendant attached to its motion a copy of Plaintiff's counsel's billing entries. (See id., Ex. A.) Defense counsel "boxed" the entries that it contested, which added up to 64 hours. This lack of consistency in the amount of time contested by the defendant placed the Court in the difficult position of attempting to ascertain the scope of its challenge.

After a review of the original briefs and after considering the arguments of counsel at the hearing in this matter, the Court will apply the following methodology.*fn9 First, the Court will assess which of the "boxed" billing entries challenged by Defendant are tasks that could have been designated to a paralegal or legal assistant. The Court will then apply the reasonable hourly rate of a paralegal in southern New Jersey to these challenged entries.*fn10

A review of the record indicates that the following challenged billing entries are tasks that could have been designated to a paralegal or legal assistant:

03.12.2009 Draft civil cover sheet, finalize 1.25 *fn11 03.26.2009 Draft waiver of service of summons 1.75 & letter to Sedgwick serving Complaint 04.30.2009 File Amended Complaint 0.75 05.01.2009 Serve Amended Complaint 0.75 05.04.2009 Review return of executed waiver 0.50 of service of summons & file proof of service 10.02.2009 Serve Plaintiff's first set of 0.75 *fn12 interrogatories in accordance with limits set forth in Magistrates opinion 10.26.2009 Send letter to Magistrate Donio 1 *fn13 supporting scope of discovery sought in Plaintiff's first set fo interrogatory answers 11.16.2009 Draft certification in opposition 1.75 to Defendants' motion for protective order 09.06.2010 Select and locate and copy 4.25 exhibits in support of motion for summary judgment 09.07.2010 Select and locate additional 3 documents in support of motion for summary judgment 09.10.2010 Draft certification of exhibits in 3 support of motion for summary judgment 09.30.2010 File motion for summary judgment 0.75 via ECF and send courtesy copy to Judge Hillman TOTAL 19.00 hours

Accordingly, the Court finds that, out of the total hours that Plaintiff's counsel charged his client, 19 hours were dedicated to tasks of a clerical nature that could have been delegated to a paralegal or legal assistant. The Court will therefore apply the $85.00 hourly rate of a paralegal in southern New Jersey to these 19 hours. See D'Orazio v. Washington Twp., No. Civ.A.07-5097, 2011 WL 6717427, at *4 (D.N.J. Dec. 21, 2011) (Irenas, J.), affirmed by D'Orazio v. Washington Twp., No. Civ.A.12-1169, 2012 WL 4874976 (3d Cir. Oct. 16, 2012).

C. The Lodestar

In calculating a reasonable attorney's fee, the Court employs the "lodestar" formula, "which requires multiplying the number of hours reasonably expended by a reasonable hourly rate." Loughner v. Univ. of Pittsburgh, 260 F.3d 173, 177 (3d Cir. 2001). The district court has the discretion to make certain adjustments to the lodestar. Rode, 892 F.2d at 1183 (internal citation omitted).

The "most useful starting point" is determining the number of hours reasonably expended on the litigation. Id. (citing Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)). Plaintiff's counsel asserts that he dedicated 185.25 hours to this litigation.*fn14 The Court will deduct 14.75 hours from this total for tasks that were clerical in nature.*fn15 The Court will further deduct from this total 19.00 hours that should have been delegated to a paralegal or legal assistant. This brings the number of hours reasonably expended on this litigation to 151.50.

185.25 - 33.75 = 151.50 "After determining the number of hours reasonably expended, the district court must examine whether the requested hourly rate is reasonable. Generally, a reasonable hourly rate is to be calculated according to the prevailing market rates in the relevant community." Rode, 892 F.2d at 1183 (citing Blum v. Stenson, 465 U.S. 886, 895 (1984)). As stated above, the reasonable hourly rate to be applied for Plaintiff's counsel is $250.00.

151.50 x 250.00 = 37,875.00

Added to this amount will be the number of hours that should have been delegated to a paralegal or legal assistant at the rate of $85.00 per hour, bringing the total fee award to $39,490.00.

19.00 x 85.00 = 1,615.00 37,875 1,615.00 = 39,490.00 Subtracted from this amount will be the 10% reduction for litigation of unsuccessful claims, bringing the total fee award to $35,541.00.*fn16

39,490.00 - 3,949.00 = 35,541.00 Finally, the Court will add to this amount Plaintiff's undisputed request for $350.00 in additional costs. 35,541.00 350.00 = 35,891.00 Accordingly, the Court finds that the total attorneys' fee award in the instant case is $35,891.00.

IV. CONCLUSION

Based on the above, Plaintiff's Motion for Reconsideration will be granted. Plaintiff's counsel is entitled to a reasonable fee award of $35,891.00.

An appropriate Order follows.

NOEL L. HILLMAN, U.S.D.J.


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