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Reynolds v. Credit Bureau Services, Inc.

United States District Court, D. Nebraska

May 16, 2016

KENNETH M. REYNOLDS, on behalf of himself and all others similarly situated; Plaintiff,
v.
CREDIT BUREAU SERVICES, INC., AND C. J. TIGHE, Defendants.

MEMORANDUM AND ORDER

Joseph F. Bataillon Senior United States District Judge

This matter is before the court on the plaintiff’s unopposed motion for attorney fees and costs and approval of incentive award, Filing No. 28. This is a class action for violations of the Fair Debt Practices and Collection Act, 15 U.S.C. § 1692 et seq. (hereinafter “FDCPA” or “Act”), and the Nebraska Consumer Protection Act (“NCPA”), Neb. Rev. Stat. § 59-1601 et seq.

I. FACTS

The parties have entered into a Settlement Agreement that resolves this litigation. See Filing No. 19-1, Index of Evid., Ex. A, Settlement Agreement. In the agreement, the defendants agreed to pay costs, litigation expenses and reasonable attorney's fees in an amount to be approved or determined by the court. Id. at 10. The defendants later agreed to payment of the plaintiff’s costs and attorney fees of up to $21, 500.00. See Filing No. 30-3, Ex. 2, Declaration of Pamela A. Car ("Car Decl.") at 3; Filing No. 24-1, Amended Notice at 2. Notice of this agreement was filed with the court, approved, and provided to the class. Id.; see Filing No. 25, Order of Preliminary Approval. The plaintiff requests an award of fees in the amount of $21, 071.79 and costs in the amount of $428.21, for a total award of $21, 500. Defendants do not oppose the motion.

The settlement agreement provides that the plaintiff class is the prevailing party in this litigation. Filing No. 19-1, Ex. 1, Settlement Agreement at 11-12. In the agreement, the defendants have agreed to pay statutory damages of $ 32, 500.00 to the Class and $4, 000.00 to lead plaintiff Reynolds as statutory damages and services as class representative. Id. at 10-11. Further, the defendants agreed to change the collection letters that are the subject of the action and to pay the costs of class administration and of class notice. Id. at 11. The settlement agreement also provides that the defendants will pay the attorney fees and costs awarded in this case from a separate fund and will pay the costs of administration and dissemination of notice. Id.; see 24-1, Amended Notice at 2.

The court held a fairness hearing on the parties’ joint motion for final approval of class settlement on May 13, 2016. No one appeared at the hearing to object to the class settlement. No objections to the settlement were filed. See Filing No. 32, Index of Evid., Ex. 1, Declaration of Steve Platt at 1.

The court is familiar with the litigation. On February 1, 2016, the Court entered an Order Preliminarily Certifying Class and Granting Preliminary Approval of Settlement. Filing No. 26. The record shows the parties engaged in extended negotiations regarding settlement and participated in a settlement conference with the magistrate judge. See Filing No. 13, text minute entry; Filing No. 14, audio file (sealed); and Filing No. 15, Order.

In support of its motion, plaintiff have shown that attorney O. Randolph Bragg expended 29.7 hours at the rate of $275.00 per hour through April 1, 2016, on behalf of the plaintiff ($11, 137.50) and Mr. Bragg’s paralegal Shannon Carter expended a total of 0.5 hours at the rate of $125.00 per hour ($62.50) on this litigation. Filing No. 30-1, Index of Evid., Ex. 1, Declaration of O. Randolph Bragg ("Bragg Decl.") at 17; Filing No. 30-2, Ex. 1A, Bragg Time Records. Lead counsel Pamela A. Car has shown she expended a total of 26.80 hours at the rate of $350.00 per hour ($9, 380.00) on behalf of the plaintiff through January 31, 2016. Filing No. 30-3, Ex. 2, Car Decl. at 3; Filing No. 30-4, Exhibit 2A - Car Time Records. Ms. Car only billed for 16.8 hours for a total of $5, 880.00, as reflected in her time records. Id., Ex. 2, Car Decl. at 3; Ex. 2A, time records. Plaintiff seeks fees for 15.75 hours of work at the rate of $325.00 per hour performed by attorney William L. Reinbrecht ($5, 118.75) and $428.21 in reimbursable expenses. Filing No. 30-5, Declaration of William L. Reinbrecht ("Reinbrecht Decl.") at 17; Filing No. 30-6, Ex. 3A, Reinbrecht Time Records.

Attorneys Bragg, Car, and Reinbrecht have also shown they have extensive experience litigating consumer cases and have achieved similar awards in other cases. See Filing No. 30-1, Ex. 1, Bragg Decl. at 5-17; Filing No. 30-3, Car Decl. at 1-2; Filing No. 30-5, Reinbrecht Decl. at 1-5. Further, counsel have shown that they reduced the hours billed where appropriate. See, e.g., Filing No. 30-3, Ex. 2, Car Decl. at 3. Also, counsel represent that the plaintiff's attorneys will not bill for attending the final hearing or for any additional work needed to complete the class-action administration. See Filing No. 29, Brief at 17.

Lead plaintiff Kenneth Reynolds seeks approval of a payment of $4, 000.00 for statutory damages and for his service as class representative. Filing No. 30-7, Index of Evid., Ex. 4, Declaration of Kenneth Reynolds at 2. He states that he has kept himself informed of the progress of the case, reviewed materials sent to him by counsel, discussed the case with counsel, taken time off work to confer with counsel and provide documents, and submitted declarations in the case.

II. LAW

A thorough judicial review of fee applications is required in all class action settlements. In re Diet Drugs, 582 F.3d 524, 537-38 (3d Cir. 2009); Johnson v. Comerica Mortg. Corp., 83 F.3d 241, 246 (8th Cir. 1996) (noting that the district court bears the responsibility of scrutinizing attorney fee requests). Courts utilize two main approaches to analyzing a request for attorney fees: (1) the “lodestar” methodology (multiplying the hours expended by an attorney’s reasonable hourly rate of compensation to produce a fee amount that can be adjusted to reflect the individualized characteristics of a given action); and (2) the “percentage of the benefit” approach (permitting an award of fees that is equal to some fraction of the common fund that the attorneys were successful in gathering during the course of the litigation). Comerica Mortg., 83 F.3d at 244-45. It is within the court’s discretion to decide which method to apply. Id.

Defendants who violate the FDCPA are liable for the plaintiff's attorney's fees and costs. Marx v. General Revenue Corp., 133 S.Ct. 1166, 1176 (2013); 15 U.S.C. § 1692k(a)(3); Zagorski v. Midwest Billing Servs., Inc., 128 F.3d 1164, 1166 (7th Cir. 1997) (per curiam) (“[T]he award of attorney's fees to plaintiffs for a debt collector's violation of ‘any provision’ of the FDCPA is mandatory.”); Hennessy v. Daniels Law Office, 270 F.3d 551, 553 (8th Cir. 2001) (citing Zagorski). The Act mandates an award of attorney’s fees as a means of fulfilling Congress’s intent that the Act should be enforced by debtors acting as private attorneys general. Gonzales v. Arrow Financial Services, LLC, 660 F.3d 1055, 1061 (9th Cir. 2011).

"Where a plaintiff has obtained excellent results, his attorney should recover a fully compensatory fee." Hensley v. Eckerhart, 461 U.S. 424, 435 (1983). Although there is no precise formula for determining a reasonable fee, the district court generally begins by calculating the lodestar-the attorney’s reasonable hourly rate multiplied by the number of hours reasonably expended. Id. at 433-37; Marez v. Saint-Gobain Containers, Inc., 688 F.3d 958, 965 (8th Cir. 2012). “At that point, other factors ‘may lead the district court to adjust the fee upward or downward, including the important factor of the ‘results obtained.’” Id. (quoting Hensley, 461 U.S. at 434). The district court should consider the factors set forth in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 717-19 (5th Cir. ...


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