Price v. Midland Funding LLC

Background

Joan Price sued Midland Funding LLC and Messerli & Kramer, P.A. under the Fair Debt Collection Practices Act. She alleged that the defendants were attempting to collect a consumer credit card debt and had used a purported answer and a declaration seeking costs and disbursements that contained false statements. Price sought damages and reasonable attorneys’ fees and costs.

The defendants offered Price a total judgment of $1,001, inclusive of all damages, plus reasonable attorneys’ fees and costs, with the amount to be agreed upon or determined by the court. Price accepted the offer, and the Clerk entered judgment in her favor on April 24, 2018. The parties did not reach agreement on fees. Price’s lawyer initially requested $4,480 and later filed a motion seeking a total of $6,080, including fees for preparing the fee petition.

Motions and Analysis

The court addressed Price’s motion for attorneys’ fees and her motion for permission to file a reply or, alternatively, to extend the deadline for filing the fee request. Under Federal Rule of Civil Procedure 54(d)(2)(B)(i), a fee motion generally must be filed within 14 days after judgment. Price filed her motion after that period.

The court granted an extension under Rule 6(b). It found good cause because the defendants’ offer expressly included reasonable attorneys’ fees and costs, Price’s acceptance reflected that understanding, and the defendants had notice that she would seek fees. The court rejected Price’s argument that her notice accepting the offer itself substituted for a fee motion but allowed the court to consider the fee request.

The defendants argued that Price’s fee agreement was void as a matter of public policy because it assigned to her lawyer any attorneys’ fees recovered or awarded. The court rejected that argument. It found that the agreement preserved counsel’s right to a lien or contingent fee of the type permitted by Minnesota Rule of Professional Conduct 1.8(i), and that the agreement did not improperly give counsel a proprietary interest in Price’s legal claim.

For the amount of the award, the court used the lodestar method: the reasonable hours worked multiplied by a reasonable hourly rate. The court found that the requested $400 hourly rate was reasonable based on counsel’s litigation and consumer-law experience, his work on more than 50 Fair Debt Collection Practices Act claims, supporting information about Twin Cities billing rates, and a prior state-court determination that his rate was reasonable.

The defendants challenged several categories of time, including work on a retainer agreement and fee-waiver application, review of the related state-court collection case, work concerning the offer of judgment, complaint preparation, administrative tasks, and preparation of the fee petition. The court rejected the requested deductions. It found that the state-court work related to the federal case, the challenged tasks were necessary and not excessive, the billing records did not show improper clerical billing, and fees for preparing the fee petition were recoverable and reasonably incurred.

Disposition

The court calculated the fee award as $400 per hour multiplied by 15.2 hours, for a total of $6,080. It declined to increase or decrease that amount.

Judge Susan Richard Nelson ordered that Price’s Motion for Attorneys’ Fees was GRANTED, awarded Price $6,080 in attorneys’ fees, and granted Price’s Motion for Leave to File a Reply or, alternatively, to Amend Deadlines Pursuant to Rule 6. The order directed that judgment be entered accordingly.