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Jones v. Southwest Credit Systems, L.P.

United States District Court, E.D. Pennsylvania

July 12, 2018

BLAIR JONES, Plaintiff,
v.
SOUTHWEST CREDIT SYSTEMS, L.P., Defendant.

          OPINION

          Slomsky, J.

         I. INTRODUCTION

         Before the Court is a Petition filed by Plaintiff Blair Jones for an award of attorney's fees and costs in the amount of $12, 964.50, pursuant to 15 U.S.C. § 1692k(a)(3) of the Fair Debt Collection Practices Act (“FDCPA”), a federal law enacted to protect consumers from abusive and unfair debt collection practices. (Doc. No. 29 ¶ 5.) The FDCPA is a fee-shifting statute; section 1692k(a)(3) allows a prevailing party to recover costs and attorney's fees in addition to damages.[1]

         Defendant Southwest Credit Systems, L.P. challenges the Petition, arguing that Plaintiff should either be awarded no attorney's fees or a reduced amount. (Doc. No. 31 ¶ 4.) Plaintiff responds that because he prevailed on a FDCPA claim, he is entitled to the full amount of attorney's fees and costs.[2] (Doc. No. 33 at 5.) Further, Plaintiff argues that his counsel exercised proper billing judgment, and therefore the amount requested is reasonable. (Id. at 9.) For the reasons stated below, the Court will grant the fee petition in part, awarding a modified amount of $6, 605.[3]

         II. FACTUAL AND PROCEDURAL BACKGROUND

         On February 2, 2017, Plaintiff Blair Jones filed a Complaint against Defendant Southwest Credit Systems, L.P., alleging that Defendant violated the Telephone Consumer Protection Act (“TCPA”), 47 U.S.C. § 227, and three sections of the FDCPA, 15 U.S.C. §§ 1692d, 1692d(5), and 1692g(a).[4] (Doc. No. 1 ¶¶ 25-34.) Plaintiff alleged that Defendant repeatedly harassed him through telephone calls regarding collection of a debt.[5] (Id.) On November 9, 2017, this Court referred the case to arbitration. (Doc. No. 24.) On November 30, 2017, a panel of three arbitrators found in favor of Plaintiff only on the § 1692d claim and awarded Plaintiff $750 in statutory damages plus reasonable attorney's fees. (Doc. No. 27.)

         On December 18, 2017, Plaintiff filed the instant Petition for Attorney's Fees. (Doc. No. 29.) Plaintiff requests $12, 964.50 in attorney's fees and costs, asserting that, as the prevailing party, he is entitled to this award under 15 U.S.C. § 1692k(a)(3), a fee-shifting statute. (Id. at 1.) He argues that the actual time expended-not the amount of recovery-dictates the award of attorney's fees and costs under the FDCPA. (Doc. No. 29-1 at 6.) The fee Petition states that Plaintiff's counsel and staff spent on this case 48.2 hours, from February 22, 2016, the date of counsel's initial interview with Plaintiff, to December 14, 2017, the date that counsel prepared the current fee Petition. (Doc. No. 29-3.) Plaintiff asserts that the time expended and the hourly rates of counsel and staff are reasonable. Thus, according to Plaintiff, $12, 964.50 in attorney's fees should be awarded. (Doc. No. 29-1.)

         On January 8, 2018, Defendant filed its Response to Plaintiff's fee Petition. (Doc. No. 31.) Defendant argues that the $750 in statutory damages awarded by the arbitration panel constitute nominal damages, rendering Plaintiff's victory as technical or de minimis.[6] (Id. ¶ 11.) Thus, according to Defendant, Plaintiff is not entitled to any attorney's fees and only $470 in costs.[7] (Id.) Alternatively, Defendant argues that if the Court finds that Plaintiff is entitled to attorney's fees, any award to Plaintiff should be reduced because the amount requested by Plaintiff is unreasonable. (Id. ¶ 12.)

         In this regard, Defendant contends that Plaintiff failed to exercise proper billing judgment by including costs for administrative and clerical work and by failing to segregate work done on the prevailing FDCPA claim from the three unsuccessful claims. (Id. ¶¶ 21, 22.) Furthermore, Defendant argues that the 48.2 hours Plaintiff billed was an unreasonable amount of time spent “on a case that resulted in no more than a single, de minimis violation out of all claims asserted.” (Id. ¶ 32.) Defendant offers two alternative amounts: $2, 104[8] or $2, 090.57, [9] which it agrees would be a proper award if the Court did not find its argument meritorious that no fee should be awarded. (Id. ¶ 39.)

         On January 15, 2018, Plaintiff filed his Reply to Defendant's Response. (Doc. No. 33.) Plaintiff asserts that because the FDCPA and TCPA claims stemmed from the same nucleus of facts, the work billed by counsel was necessary for the single, prevailing FDCPA claim. (Id. at 6-7.) Due to the integrated nature of the claims and the work completed, Plaintiff submits that a reduction in fees based on the lack of segregation is neither necessary nor appropriate. (Id.) Additionally, Plaintiff asserts that counsel exercised billing judgment by providing an itemized, descriptive bill that properly included the work of counsel and counsel's staff. (Id. at 8-9.)

         III. ANALYSIS

         To award a plaintiff attorney's fees and costs under a fee-shifting statute, the Court conducts a two-step inquiry. Pub. Interest Research Grp. of N.J., Inc. v. Windall, 51 F.3d 1179, 1184 (3d Cir. 1995). First, the party seeking the award must be deemed a “prevailing party.” Id. Second, any fees awarded must be “reasonable, ” meaning they “are the product of the hours reasonably expended and the applicable hourly rate for the legal services.” Id. at 1185 (citing Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)).

         A. Plaintiff Is the Prevailing Party Because He Was Awarded Damages Based on the Merits of His § 1692d Claim

         Courts define “prevailing party” broadly. To become a “prevailing party” and cross the threshold for statutory fee-shifting, a plaintiff must “succeed on any significant issue in litigation which achieves some of the benefit the parties sought in bringing the suit.” Hensley, 461 U.S. at 433 (quoting Nadeau v. Helgemoe, 581 F.2d 275, 278-79 (1st Cir. 1978)); see also Farrar v. Hobby, 506 U.S. 103, 111-12 (1992) (“In short, a plaintiff ‘prevails' when actual relief on the merits of his claim materially alters the legal relationship between the parties by modifying the defendant's behavior in a way that directly benefits the plaintiff.”).

         Defendant contends that Plaintiff is not the prevailing party because his victory is technical or de minimis and his damages are nominal. The Court finds these arguments unpersuasive. Although Plaintiff only succeeded on one of his three FDCPA claims, he is considered a prevailing party for the purposes of § 1692k(a)(3).

         First, Plaintiff's victory is not technical or de minimis. In Nelson v. Select Financial Services, Inc., the court held that the plaintiff's victory was “neither de minimis nor technical” because she demonstrated on summary judgment that the defendant had violated provisions of the FDCPA. No. 05-3473, 2006 WL 1672889, at *3 n.5 (E.D. Pa. June 9, 2006). Here, the arbitrators determined that Defendant violated § 1692d of the FDCPA. (Doc. No. 27.) Therefore, Plaintiff's victory is neither technical nor de minimis.

         Second, Plaintiff's damages are not nominal. In Hensley v. Berks Credit & Collections, the court held that the plaintiff was the prevailing party under the FDCPA although she only succeeded on two of her three claims at arbitration and did not receive the full amount of damages available. No. 97-790, 1997 WL 725367, at *4 n.8 (E.D. Pa. Nov. 18, 1997). Here, the arbitrators awarded Plaintiff $750 in statutory damages out of the maximum $1, 000 possible award he could have received under 15 U.S.C. § 1692k(a)(1). (Doc. No. 27.) This award is an enforceable judgment against Defendant. It affects Defendant's behavior toward Plaintiff in a way that directly benefits him-by requiring Defendant to pay $750 to Plaintiff-and therefore, meets the standard set out in Farrar. 506 U.S. at 112. Thus, Plaintiff has prevailed in this case.

         B. Plaintiff Is Entitled to a Reduced Award of Attorney's Fees and Costs

         Although Plaintiff is entitled to reasonable attorney's fees as the prevailing party, the Court does not find the requested amount to be reasonable and will reduce the award.

         The United States Supreme Court has provided guidance on how to make an initial calculation of ...


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