Hitachi Data Systems Credit Corporation v. Precision Discovery, Inc.

Background

Hitachi sued Precision for allegedly failing to make payments required by a lease agreement. Precision filed counterclaims against Hitachi and brought claims involving Hitachi’s parent company, Hitachi Vantara Corporation, and Cold Creek Solutions, Inc. The court dismissed Precision’s counterclaims and third-party claims, leaving Hitachi’s breach-of-contract claim. The court later granted Hitachi summary judgment, meaning it decided that claim without a trial, and entered judgment for Hitachi in the amount of $6,184,258.57.

The parties stipulated in the judgment that Hitachi was entitled to attorney’s fees and costs under paragraph 16.3(c) of the lease. That provision required Precision to pay Hitachi’s costs and expenses, including legal and collection fees, incurred to enforce the lease. The fee motion therefore concerned the reasonable amount of fees and costs, not whether the lease allowed recovery.

Attorney’s Fees

The court used the “lodestar” method, which generally calculates fees by multiplying a reasonable hourly rate by a reasonable number of hours. Hitachi sought rates ranging from $335 to $525 for three partners, $160 for two associates, and $155 for a paralegal at GrayRobinson, P.A. It also sought rates of $550 and $475 for two local-counsel partners. Precision argued that the rates were unreasonable because the case did not require the claimed level of skill and specialization.

The court rejected that challenge, concluding that the requested rates were within rates approved in other commercial cases in the Southern District of New York. But the court found that John Boudet, GrayRobinson’s most senior partner, had billed approximately 439 of the requested 863 GrayRobinson hours at $525 per hour. The court concluded that some tasks Boudet performed, including drafting the complaint and motions, communicating about a pro hac vice application, and reviewing discovery responses, did not require an attorney with his level of experience. It applied an approximate 20% reduction, totaling $46,095, to Boudet’s requested fees.

The court did not reduce the award because some billing records were redacted. It found that most entries were not redacted and that the surrounding context allowed the court to determine the nature of the work in the redacted entries. The court also rejected Precision’s objections to work involving Cold Creek because Precision’s claims against Cold Creek were closely connected to its counterclaims against Hitachi. Finally, the court rejected Precision’s objection to work by out-of-district counsel, explaining that attorneys may need to research the governing law even when they practice elsewhere.

Costs and Disposition

Precision’s only objection to costs concerned alleged travel expenses for Hitachi’s lawyer. Hitachi stated that it was not seeking those expenses in the fee application. The court therefore awarded the full $13,859.70 in requested costs.

Hitachi requested $369,570 in attorney’s fees. After the reduction to Boudet’s fees, the court awarded $323,475 in attorney’s fees. Together with the full costs award, the total was $337,334.70. Judge Sidney H. Stein granted Hitachi’s motion for attorney’s fees and costs and entered that award against Precision.