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United States of America v. $1

March 1, 2013


The opinion of the court was delivered by: Marc L. Goldman United States Magistrate Judge


I. Introduction

On November 20, 2012, in this civil forfeiture proceeding initiated by the United States, the Court entered an Opinion and Order granting the motion for summary judgment brought by Claimants Lonnie Kocontes and Katherine Kern. See U.S. v. $1,026,781.61 in Funds from Florida Capital Bank, Nos. SACV 09--04381--MLG, SACV 09--00716--MLG.*fn1 On January 8, 2013, Claimants filed a motion for award of attorney fees pursuant to 28 U.S.C. § 2465(b)(1)(A).

Claimants seek a total award of more than $800,000.00 which consists of the following: (1) approximately $565,000 in fees for David Michael and Edward Burch, Claimants' current attorneys, using a standard lodestar analysis and enhancing that lodestar figure by 2.0, plus $22,550.92 in costs incurred; (2) $65,000 for work by John Cogorno and Lynne Patterson of Mendoza & Associates, Claimants' attorneys from July 2009 to June 2011; (3) $100,073.51 in fees and costs incurred by the Law Office of Mark Werksman, Claimants' original attorney; and (4) $74,266.35 in costs paid to private investigator Susan McQueen. (Claimants' Reply at 1.)

The Government concedes that Claimants are entitled to recover reasonable attorney fees, but argues that the amount Claimants seek is excessive and inadequately documented, and should therefore be reduced.

II. Discussion

A. The Civil Asset Forfeiture Reform Act

The Civil Asset Forfeiture Reform Act ("CAFRA") provides, in pertinent part, "in any civil proceeding to forfeit property under any provision of Federal law in which the claimant substantially prevails, the United States shall be liable for-(A) reasonable attorney fees and other litigation costs reasonably incurred by the claimant. . . ." 28 U.S.C. § 2465(b)(1)(A). Here, where the Court granted Claimants' Motion for Summary Judgment, it is undisputed that Claimants "substantially prevailed" and are therefore entitled to recover reasonable attorney fees.

B. The Amount of Fees Requested

1. Lodestar Legal Standard

Attorney fees under CAFRA are calculated using the lodestar method. United States v. $186,416.00 in U.S. Currency, 642 F.3d 753, 755 (9th Cir. 2011). "The 'lodestar' is calculated by multiplying the number of hours the prevailing party reasonably expended on the litigation by a reasonable hourly rate." Caudle v. Bristow Optical Co. Inc., 224 F.3d 1014, 1028 (9th Cir. 2000) (citing Morales v. City of San Rafael, 96 F.3d 359, 363 (9th Cir. 1996)). "The fee applicant bears the burden of establishing entitlement to an award and documenting the appropriate hours expended and hourly rates." Henslev v. Eckerhart, 461 U.S. 424, 437 (1983).

The court has the discretion to evaluate the reasonableness of the number of hours claimed by a prevailing party. Sorenson v. Mink, 239 F.3d 1140, 1145 (9th Cir. 2001); Gates v. Deukmejian, 987 F.2d 1392, 1398 (9th Cir. 1992). "[H]ours may be reduced by the court where documentation of the hours is inadequate; if the case was overstaffed and hours are duplicated; if the hours expended are deemed excessive or otherwise unnecessary." Chalmers v. City of Los Angeles, 796 F.2d 1205, 1210 (9th Cir. 1986), amended on other grounds, 808 F.2d 1373 (1987). The court must consider, among other factors, the complexity of the case or the novelty of the issues, the skill required to perform the service adequately, the customary time expended in similar cases, and the attorney's expertise and experience. Widrig v. Apfel, 140 F.3d 1207, 1209 (9th Cir. 1998); Kerr v. Screen Extras Guild, Inc., 526 F.2d 67, 69-70 (9th Cir. 1975).

Once the court has established the number of hours reasonably expended, it must determine a reasonable hourly rate. Under CAFRA, the moving party "must show that the hourly rates charged are 'in line with those prevailing in the community for similar services by lawyers of reasonably comparable skill, experience and reputation.'" United States v. $60,201.00 U.S. Currency, 291 F.Supp.2d 1126, 1130 (C.D. Cal. 2003) (quoting Sorenson, 239 F.3d at 1145). "[A]ffidavits of the [claimants'] attorney[s] and other attorneys regarding prevailing fees in the community, and rate determinations in other cases ... are satisfactory evidence of the prevailing market rate." Camacho v. Bridgeport Financial, Inc., 523 F.3d 973, 980 (9th Cir. 2008) (internal citation and quotation marks omitted). Additionally, the actual fee agreement can be considered when determining a reasonable rate. $186,416.00 in U.S. Currency, 642 F.3d at 755.

In arriving at an appropriate attorney fee award, district courts must "show their work" with respect to calculations and "specify reasons" for not awarding costs. Padgett v. Loventhal, No. ...

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