Royal Alliance Associates, Inc. v. Mora

          ORDER GRANTING AMENDED MOTION FOR ATTORNEYS' FEES RE: ECF NO. 41

          JON S. TIGAR United States District Judge.

         Before the Court is Respondents' Motion for Attorneys' Fees, ECF No. 41, filed pursuant to this Court's order granting them post-arbitration attorneys' fees in connection with their defeating Petitioner's motion to vacate the arbitration award, ECF No. 38. Petitioner has opposed the motion for attorneys' fees. ECF No. 42. The Court will grant Respondents' motion.

         I. BACKGROUND

         This case concerns two joined disputes between Royal Alliance, a brokerage firm, and its former clients Michele R. Lewis ("Lewis"), Henry T. Mora ("Mora"), and Lionel Gonzalez ("Gonzalez" collectively with Lewis and Mora "Respondents"), for breach of fiduciary duty and negligent supervision. Pursuant to Royal Alliance's customer agreements, the disputes were required to be submitted to arbitration before a FINRA (The Financial Industry Regulatory Authority) panel. ECF No. 25 at 6. In their claims, Respondents, inter alia, alleged: (1) Royal Alliance's registered representatives recommended unsuitable securities investments for Respondents, and (2) Royal Alliance breached its contracts with Respondents by failing to properly supervise its representatives. Id. at ¶ 6, 8. Respondents sought attorneys' fees in both claims. Id. On September 5, 2014, Respondents filed a motion before the Mora/Gonzalez panel, requesting to join the Lewis Arbitration to the Mora/Gonzalez Arbitration. ECF No. 1 at ¶ 11. Royal Alliance opposed the motion. Id. at ¶ 12. On October 21, 2014, the Mora/Gonzalez panel granted Respondents' motion, and consolidated both arbitrations before the Mora/Gonzalez panel. Id. at ¶ 14.

         On July 15, 2015, the Mora/Gonzalez panel awarded Respondents compensatory damages of $1, 085, 456, punitive damages of $75, 000, attorneys' fees of $184, 000, and costs of $57, 231.05. Id. at ¶ 26.

         Royal Alliance filed a petition to vacate the arbitration decision in this Court on August 13, 2015. ECF No. 1. They argued that the consolidation of both arbitrations was improper because the cases should have been consolidated before the lower-numbered Lewis panel rather than before the higher-numbered Mora/Gonzalez panel. Id. at ¶¶ 28-29. They also challenged the award of attorneys' fees.

         On March 10, 2016, this Court denied Royal Alliance's petition to vacate the arbitration award and granted Respondents' cross-motion to confirm the arbitration award as well as its motion for post-arbitration attorneys' fees. ECF No. 38. As ordered, Respondents filed their motion for attorneys' fees on March 24, 2016. An amended motion was later filed, as approved by the Court, on April 7, 2016. ECF No. 41. Although there is some dispute over the exact sequence of events leading to this, Respondents assert that subsequent to the filing of their motion, Royal Alliance sought to meet and confer over Royal Alliance's objections to the motion. Id. at 2. The parties met and conferred, and "as an attempt to resolve the disputes in good faith, " Respondents submitted their amended motion with a reduced request for attorneys' fees. Id.

         Royal Alliance nevertheless opposed the amended motion. ECF No. 45. They assert that the requested attorneys' fees should be cut in half, and contend that they are further entitled to their own attorneys' fees for successfully opposing this motion. Id.

         II. DISCUSSION

         "Federal courts in diversity cases apply state law with regard to the granting or denying of attorneys' fee recovery." Good Earth Corp. v. M.D. Horton & Associates, No. C-94-3455-CAL, 1997 WL 702297, at *2 (N.D. Cal. Aug. 4, 1997) (citing to Kabatoff v. Safeco Ins. Co. of America, 627 F.2d 207, 209-10 (9th Cir. 1980)). "California affords its trial courts broad discretion to consider a wide number of factors in determining the reasonableness of attorneys' fees." Id. at *3 (citation omitted). "For example, the court may consider the nature and difficulty of the litigation, the skill required and the skill employed in handling the litigation, the success of the attorney's efforts, the attorney's experience in the particular type of litigation, and the amount of time required." Id.

         Here, Respondents have requested $94, 301.75 for litigating the cross-petitions on the arbitration award (reduced from the original request of $98, 672.50). They also request attorneys' fees for litigating this motion, bringing their total request to $102, 857.75. ECF No. 47 at 6.

         Royal Alliance requests that this amount be cut in half, offering two reasons why the requested amount is unreasonable. Neither is persuasive. First, Royal Alliance argues that the amount of time that Respondents' counsel billed for working on their Motion for Attorneys' Fees, Cross-Petition and Opposition to the Petition to Vacate, and their Reply in Support of their Cross-Petition is excessive. ECF No. 45 at 6-8. They compare this case to two cases, Value Selling Associates, LLC v. Temple, No. 09-CV-1493-JM AJB, 2011 WL 5025157, at *3 (S.D. Cal. Oct. 21, 2011) and Latinamerican Theatrical Grp., LLC v. Swen Int'l Holding, No. 2:13-CV-01270-CAS, 2013 WL 5563749, at *2 (C.D. Cal. Oct. 7, 2013), ^[1] and contend that because both of these cases also dealt with petitions to vacate arbitration awards but involved far lower awards of attorneys' fees to the prevailing parties, Respondents' request for fees here is comparatively too large. ECF No. 4-6.

         Royal Alliance's argument appears to be, in other words, that because two courts in other districts awarded a certain amount in attorneys' fees for post-arbitration litigation, no other court should award more than those amounts. The argument collapses under its own weight. Further, Respondents astutely point out that Royal Alliance has, in the same brief in which it argues that Respondents' request for $94, 301.75 is excessive, also requested the sum of $20, 775 solely for ostensibly defeating Respondents' original motion for attorneys' fees.^[2] ECF No. 45 at 13. Royal Alliance cannot persuasively argue that Respondents' requested fees for the entirety of this litigation is unreasonable while simultaneously requesting approximately a fifth of that amount merely for opposing Respondents' fee requests.

         Second, Royal Alliance argues that Respondents have unreasonably billed for clerical and administrative tasks, such as intra-office conferences, creating a table of contents and table of authorities, final review of briefs, and verifying case citations. ECF No. 45 at 12. Royal Alliance argues that because ...