In perfect litigation, all facts are disclosed, including those that adversely affect your causes of action. In Adonizio v Credit Control Services, Inc., 2023 WL 21953, M.D. Fl., a plaintiff who failed to disclose a home sale just months after commencing litigation, was penalized by the severely limited recovery of attorney’s fees.
The litigation began with a complaint for violation of the Fair Debt Collections Practices Act ("FDCPA") and Florida's Consumer Collections Practices Act ("FCCPA") related to the collection of an unpaid bill for medical laboratory work. The plaintiff claimed he had paid the bill and that credit reporting affected his ability to obtain favorable mortgage rates and insurance, resulting in significant actual damages.
The parties resolved the FDCPA and FCCPA claims and actual damages in March 2022 by way of an Offer of Judgment providing for $1,001 on the FDCPA claim, $1,001 on the FCCPA claim, and $448 in actual damages. The Offer included reasonable attorneys’ fees and costs as allowed by the Court. However, a fight ensued about reasonable attorney’s fees. The plaintiff claimed 133 hours of work and $1,481 in costs. The parties were ordered to mediate the fees and costs issue, but the plaintiff filed a Motion seeking relief from the mediation. The Court then ordered the parties to participate in a settlement conference, and no agreement was reached. The plaintiff filed his Motion for Attorney’s Fees, requesting $39,990 in fees for 133 hours and $1,481.10 in costs. The defendant filed its Response contesting the reasonableness of the number of hours on the basis that the plaintiff failed to disclose that he sold his home four to five months after initiating the litigation and continued to extend the litigation for approximately seven or eight months after the sale.
A Report and Recommendation was issued finding 20 hours or $6,000 in attorney’s fees to be reasonable and agreeing in large part with the defendant’s arguments that the hours claimed were unreasonable because the maximum amount and type of the plaintiff’s damages had changed shortly after the suit was filed with the home sale and the plaintiff unnecessarily extended and complicated the litigation by not disclosing the sale.
The plaintiff filed his Objections, including a claim for “fees on fees.” The defendant filed their Response, maintaining its position and endorsing the Magistrate Judge’s findings. The Court then issued its Order on the Report providing a detailed analysis of the litigation, noting the plaintiff’s failure to disclose the sale of the house and noting the defendant did not become aware of the home sale for seven or eight months after the litigation was filed. The Court found no error with the Magistrate Judge’s finding that 20 hours were reasonable but did point to the plaintiff’s objections criticizing how “the plaintiff repeatedly quibbles with the magistrate judge’s description of the nature of the plaintiff’s claims.” And the plaintiff’s “semantic attack about ‘damages’…” ultimately found an issue with “the plaintiff’s assault on the magistrate judge’s quite accurate description of plaintiff’s initial assertion of his damages.” The Court stated, “The magistrate judge clearly understood that… when the home was sold in June 2021, plaintiff’s actual damages ceased to accrue and noted the defendant’s argument that the home sale “reduc[ed plaintiff’s] potential claim (due to higher interest costs) from many years to just a few months”)) and that once the home sold, ‘the possible recoverable damages were no more than $1,000 per count,’ the settled amount of actual damages was $448—a proportionately de minimis sum that does not affect the accuracy of the Report’s description of the course of the case and the effect on the litigation of plaintiff’s failure to disclose the sale of the house.”
The Court took issue with the plaintiff and his counsel’s failure to disclose the home sale and their continued attempt to defend the failure stating, “Counsel refuses to state in his filings when he became aware of the sale.” While referencing emails between counsel “that seemed to reflect counsel knew that Plaintiff moved out of state around June 1, 2021, though counsel maintained that he did not deduce that Plaintiff had sold the house with the at-issue mortgage.” The Court then said, “And even if Plaintiff’s counsel did not know, Plaintiff certainly did, and he cannot expect Defendant to foot the bill for attorney hours expended unnecessarily because of his failure to disclose.” Ultimately, the Court agreed with the Report’s finding that “… Plaintiff’s failure to disclose the sale to Defendants and its prolonging effect on the litigation.”
In addition, the plaintiff objected to the finding that 20 hours were reasonable and accused the magistrate judge of “fabricat[ing] a timesheet” and calling the report “wholly unacceptable.” The plaintiff’s choice of words was met with ire by the Court, which noted, “plaintiff’s counsel’s disrespect for the Court—already apparent from the tone of the rest of the Objections—is palpable here. Counsel’s word choices are completely uncalled for. It is not for counsel to decide or declare what is or is not “wholly unacceptable” when speaking of a judicial officer’s work. And counsel’s repeated use of the word “fabricate” is especially troubling… in the legal arena, it is most often used in its underhanded sense: “to make up for the purpose of deception….” The Court chastised the plaintiff’s counsel declaring “...what is ‘wholly unacceptable’ here is the plaintiff’s counsel’s disrespectful and unfounded accusation against a member of the judiciary.” and made note that the plaintiff’s counsel came “…perilously close…” to violating the Florida Bar Rules reminding the plaintiff’s counsel that “…Ad hominem attacks are not persuasive to a reviewing court; in fact, they have the opposite effect—to diminish the credibility of the one spewing insulting hyperbole...”
The plaintiff argued that counsel was entitled to “fees on fees” related to the fee petition and time spent after the Offer of Judgment was accepted. In its analysis, the Court stated, “…under precedent, counsel is entitled to some compensation for litigating fees.” The Court conducted a detailed analysis of the additional 44.1 hours claimed and limited the plaintiff’s reasonable attorney’s fees to 9.65 hours, finding a majority of the time to be “grossly excessive,” excessive,” “unreasonable, and excessive” or that the plaintiff failed to show it was “necessary or reasonable.”
The Court then addressed recoverable costs allowing only for the $400 filing fee of the $1,481.10 claimed by the plaintiff. The Court agreed with the defendant’s argument that the plaintiff did not utilize Rule 4 and was not entitled to service costs and disallowed cost for mediation, stating “…district courts in this circuit have, with approval of the Eleventh Circuit, declined to award mediation costs under the FDCPA because such costs are not allowed under the general costs provision, 28 U.S.C. § 1920.”
Gordon Rees Scully Mansukhani Philadelphia Partner Lori J. Quinn and Miami Partner Chantel C. Wonder served as counsel for the defendant.