Spectrum Scientifics, LLC v. Celestron Acquisition, LLC

Background

Defendants moved under Federal Rule of Civil Procedure 72(a) and 28 U.S.C. § 636(b)(1)(A) for relief from Magistrate Judge DeMarchi’s August 2, 2023 fee order. That order had granted in part a plaintiff-side request to compel discovery and obtain sanctions under Rule 37(b)(2)(C), based on defendants’ delayed or incomplete production of transactional data.

The magistrate judge awarded a total of $71,652.50: $67,265 in attorney fees and $4,387.50 in expert fees. Defendants argued that the expert fees were improperly awarded and that the attorney-fee award included duplicative work and vague billing entries. They sought a $32,110 reduction and asked the court to stay, or pause, enforcement of the fee order while the motion was decided.

Standard of Review

A district court may reverse a magistrate judge’s nondispositive pretrial order only if it is clearly erroneous or contrary to law. The court described this as a highly deferential standard and stated that it could not simply substitute its judgment for the magistrate judge’s judgment.

Expert Fees

Defendants argued that the fee order improperly relied on declarations from expert Christopher Groves because plaintiff had not timely made Groves available for a deposition. The court stated that defendants had not raised an objection to the expert fees in their opposition before the magistrate judge, so the argument was waived under Rule 72(a).

The court also reviewed the hearing record and found that the issue had in fact been raised and considered. Judge DeMarchi decided to rely only on Groves’s first declaration, which contained factual observations about the condition of the data, and not on his second declaration. The fee order awarded fees based only on the first declaration. The district court found no clear error and no conflict with applicable law in that decision.

Attorney-Fee Entries

Defendants argued that the plaintiff’s billing records included administrative, duplicative, and vaguely described work. The court found that defendants’ challenge to 117 billed hours did not accurately describe the fee order because Judge DeMarchi had not awarded fees for all 117 hours. The magistrate judge had excluded paralegal work and approved fees for 81.3 hours reasonably expended.

Judge DeMarchi had also specifically reviewed five billing entries that defendants challenged as vague or duplicative. She found that the entries were adequately documented and reasonably described the work when viewed in context. The district court agreed and found that defendants had not identified a specific invoice that was so vague or unsupported that it could not be evaluated.

Disposition

The court held that the August 2, 2023 fee order was neither clearly erroneous nor contrary to law. It denied defendants’ request to reduce the fee award and denied as moot defendants’ request to stay enforcement of the fee order. The court ordered defendants to pay $71,652.50 in sanctions to plaintiff within 30 days, in accordance with the fee order.