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QVC, Inc. v. MJC America, Ltd.

United States District Court, Third Circuit

August 5, 2013

QVC, INC.
v.
MJC AMERICA, LTD. d/b/a SOLEUS INTERNATIONAL, INC. Date Description Time Amount Total

MEMORANDUM

THOMAS N. O’NEILL, JR., J.

The parties’ claims against each other in this action arose out of plaintiff and counterclaim defendant QVC, Inc.’s purchase of electric space heaters and other items from defendant and counterclaim-plaintiff MJC America, Ltd. d/b/a Soleus, International, Inc. and QVC’s subsequent recall of certain of those space heaters. After a bench trial I found that Soleus is liable for QVC’s reasonable attorney’s fees resulting from Soleus’s breach of its obligations to QVC under terms of certain Purchase Orders for those space heaters and other items. Dkt. No. 112 at ECF p. 51. I also found that Soleus is liable to QVC for prejudgment interest with respect to QVC’s damages. Id. at ECF p. 51-53.

In Section 4 of the Purchase Orders, Soleus agreed, inter alia, to hold harmless and indemnify QVC from and against any “direct, special, incidental, exemplary, and consequential damages and losses of any kind, ” specifically including lost profits and reasonable attorneys’ fees “based upon or resulting from . . . any alleged or actual defect” in the Heaters. Jt. Stip. ¶ 14; P-9. Section 4 provides, in relevant part:

4. Vendor hereby agrees to protect, defend, hold harmless and indemnify Buyer . . . from and against any and all claims, actions, suits, costs, liabilities, damages and expenses (including but not limited to, all direct, special, incidental, exemplary and consequential damages and losses of any kind [including, without limitation, present and prospective lost profits and lost business] and reasonable attorneys’ fees) based upon or resulting from . . . (b) any alleged or actual defect in any of the Merchandise . . . [and] (d) breach by Vendor of any representations, warranties or covenants[.]

Id.

Now before me is QVC’s motion to revise the judgment entered in favor of it and against Soleus, International, Inc. to include its reasonable attorney’s fees and prejudgment interest. In its motion, QVC seeks $747, 647.76 in reasonable attorney’s fees and $157, 804.50 in costs and expenses, [1] including expert witness fees paid to Saul Ewing, LLP. Dkt. No. 104 at ECF p. 3; Dkt. No. 114. QVC also seeks $16, 632.00 in reasonable attorney’s fees and $645.71 in costs and expenses paid to Brown & Gidding, P.C.”[2] Id. Upon consideration of QVC’s motion (Dkt. No. 104), Soleus’s opposition thereto (Dkt. Nos. 112 and 113), and QVC’s reply (Dkt. No. 114), I will enter an order revising the judgment consistent with the following opinion.

I. Attorney’s Fees

The lodestar formula, which multiplies by a reasonable hourly rate the number of hours reasonably expended, provides the starting point for determining reasonable attorneys’ fees. Hensley v. Eckerhart, 461 U.S. 424, 433 (1983). Where an “adverse party raises objections to [a] fee request, the court possesses considerable discretion to adjust the award in light of those objections.” Loesch v. City of Phila., No. 05-0578, 2008 WL 2557429, at *2 (E.D. Pa. Jun. 25, 2008), citing Rode v. Dellarciprete, 892 F.2d 1177, 1183 (3d Cir. 1990). The “Court has an independent duty to satisfy itself that the [ ] fees requested are reasonable.” Alphonso v. Pitney Bowes, Inc., 356 F.Supp.2d 442, 460 (D.N.J. 2005); cf. Mosaid Techs. Inc. v. Samsung Elecs. Co., 224 F.R.D. 595, 597 (D.N.J. 2004) (“Although the calculation of attorneys’ fees and costs is an inexact science, . . . the amount awarded must still be reasonable.”) (citations and internal quotation omitted).

A. Saul Ewing’s Hourly Rates

Soleus challenges the reasonableness of the hourly rates charged by Saul Ewing. “The party requesting fees has the burden of demonstrating the reasonableness of the fees by submitting evidence of the appropriate hourly rate.” Aerogroup Int’l v. Ozburn-Hessey Logistics, LLC, No. 08-4217, 2010 WL 4746246, at *5 (D.N.J. Nov. 15, 2010), citing Washington v. Phila. Cnty. Ct. of Comm. Pleas, 89 F.3d 1031, 1035 (3d Cir. 1996). “A reasonable rate is the prevailing market rate in the relevant community. An attorney’s usual billing rate is a good starting point for assessing reasonableness, though it is not dispositive.” Neena S. v. Sch. Dist. of Phila., No. 05-5404, 2009 WL 2245066, at *3 (E.D. Pa. July 27, 2009), citing Washington, 89 F.3d at 1035-36.

Soleus contends that the Court should look to the fee schedule established by Community Legal Services, Inc. to determine the reasonableness of the rates QVC seeks to recover. Dkt. No. 113 at p. 4. “The Third Circuit and this Court have accepted the CLS Fee Schedule in some circumstances – when the attorneys were associated with CLS, or when the parties submitted limited evidence regarding fees.” Zavodnick v. Gordon & Weisberg, P.C., No. 10-7125, 2012 WL 2036493 (E.D. Pa. June 6, 2012) (citations omitted), at *5. As Soleus notes, QVC’s motion to revise the judgment does not set forth evidence to establish whether the hourly rates charged by Saul Ewing are reasonable. Dkt. No. 113 at p. 4. To respond to this deficiency QVC attached to its reply memorandum evidence to demonstrate that its hourly rates were reasonable based on an “assess[ment] of the experience and skill of [QVC’s] attorneys” and a comparison of “their rates to the rates prevailing in the community for similar services by lawyers of reasonably comparable skill, experience and reputation, ” Interfaith Cmty. Org. v. Honeywell Int’l, Inc., 426 F.3d 694, 708 (3d Cir. 2005). QVC’s evidence includes a declaration by Craig R. Tractenberg, Esq. of Nixon Peabody LLP and publicly available surveys of hourly fees charged by attorneys in the Philadelphia market with reasonably comparable skill, experience and reputation. Dkt. No. 114 at ECF p. 5-6. Faced with this additional evidence regarding appropriate benchmarks for the hourly rates for QVC’s attorneys, Soleus did not file a response further challenging the reasonableness of the hourly rates sought. It has not, therefore

rebut[ted QVC’s] prima facie case of the reasonableness of the rates requested for [its attorneys]. It has not challenged the qualifications of Mr. [Tractenberg] to opine on this issue, and it has submitted no affidavit and offered no testimony contesting the accuracy of Mr. [Tractenberg’s] statements regarding the rates for attorneys in Philadelphia with similar experience and expertise.

Blagrave v. Nutrition Mgmt. Servs. Co., No. 05-6790, 2009 WL 440299, at *7 (E.D. Pa. Feb. 20, 2009).

Having reviewed the information submitted by the parties and considering the experience of QVC’s attorneys and the rates charged by similarly experienced attorneys for comparable work, I find that there is not a reason to depart from the hourly rates charged by QVC’s attorneys in calculating the fee award.

B. Number of Hours Expended

Courts should review the time charged and determine whether the hours listed were reasonably spent on the particular tasks described. Maldonado v. Houstoun, 256 F.3d 181, 184 (3d Cir. 2001). Excessive, redundant or unnecessary hours should not be included in calculating an award of fees. Hensley, 461 U.S. at 434. Where “an objecting party has challenged specific types of work and states why it is contended that the hours claimed are excessive, the reviewing court must support its findings with a sufficient articulation of its rationale to allow for meaningful appellate review.” Interfaith Cmty. Org. v. Honeywell Int'l, Inc., No. 11-3813, 2013 WL 3481510, at *10 (3d Cir. July 8, 2013) (citation omitted). Accordingly, I will consider each of Soleus’s objections to the time sought by QVC’s attorneys.

1. Hours Billed by Senior Attorneys

Soleus objects to the number of hours expended by senior attorneys on this matter, arguing that “85% of Saul Ewing’s professional time and 90% of the dollar value was billed by three Saul Ewing partners ([Nathaniel] Metz, [David] Moff[it]t and [Amy] Kline) with 9 or more years of experience at a blended rate of $415/hr.” Dkt. No. 113 at p. 9. Soleus contends “that such top-heavy billing and lack of delegation is unreasonable for a non-complex matter such as this.” Id. In particular, Soleus challenges certain time entries by partners Metz and Moffitt as time billed for tasks that “should have been delegated and could have been performed by less-skilled personnel (i.e., associate, paralegal, or secretarial)[.]” Id. The time entries in question were identified as follows:

Investigate corporate identity of vendor

0.3

Assistance in research of legal issues for complaint and possible injunction

0.8

Assistance with research on pre-judgment attachment of assets

0.2

Letter to Soleus re: Court Notice and Guidelines

0.2

Review Motion for extension of time and correspondence to defendant’s counsel re: same

0.1

Correspondence to court re: motion to dismiss

0.3

Confirm service date and method

0.3

Assistance with third party subpoenas

0.3

Assistance with deposition scheduling

0.3

Assistance with Sam’s Club subpoenas

0.1

Assistance with deposition scheduling issues

0.4

Interview potential translators re Chinese depositions

0.3

Investigate Mandarin interpreter for Chinese witnesses

0.4

Assistance with scheduling of inspection

0.3

Assistance with scheduling of inspection

0.3

Assistance with resolution of expert inspection issues

0.4

Further assistance with resolution of ...


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