United States District Court, D. Nevada
ANDREW P. GORDON, District Judge.
Plaintiffs Frank Taddeo and Amelia Taddeo brought securities and various common law claims against defendants American Invsco Corp. ("AIC"), Nicholas Gouletas, Koval Flamingo, LLC ("Koval"), Condominium Rental Services Inc. ("CRS"), and Rebekah Desmet. Plaintiffs' claims arose from their purchase of a condo from defendants. I dismissed plaintiffs' securities claims and the case proceeded to trial on the remaining claims.
At trial, plaintiffs prevailed on their claims against Koval and AIC and failed in their claims Gouletas, CRS, and Desmet. Koval and AIC have moved for judgment as a matter of law and for a new trial. The parties now move for attorneys' fees.
I deny plaintiffs' request because they have failed to establish they are entitled to fees and because their request is premature given that they are likely to bill additional fees related to pending motions. I dismiss defendants' request for full reimbursement of their fees because they have failed to establish they are entitled to full reimbursement and they improperly request fees incurred in other cases.
But I grant defendants the fees they incurred defending the securities claims in this case. Under the Private Securities Litigation Reform Act of 1995 ("PSLRA"), defendants are entitled to fees if plaintiffs brought claims that were not reasonably supported by law or fact. Plaintiffs fail to adequately address defendants' arguments related on this point, and plaintiffs' own evidence indicated a statute of repose applied to their failure to register claims.
I. Legal Standard: Attorneys' fees
The "American Rule" is that each party is generally responsible for its own attorneys' fees. However, an award of reasonable attorneys' fees may be proper where a contract or statute shifts them to the losing party.
Once a party establishes it is owed fees, the relevant inquiry becomes what fees are reasonable. The reasonableness of attorneys' fees is determined using the "lodestar" figure. The lodestar is calculated by "multiplying the number of hours the prevailing party reasonably expended on the litigation by a reasonable hourly rate." Generally, "the court should defer to the winning lawyer's professional judgment as to how much time he was required to spend on the case; after all, he won." A reasonable rate is determined based on the prevailing rate in the community where the court sits.
Requests for attorneys' fees should typically be decided after all relevant motions in the case have been resolved so that the court knows who prevailed and may accurately determine the hours billed by the attorneys. Parties generally cannot request fees for time billed on different cases.
II. Plaintiffs' motion for attorneys' fees
Plaintiffs argue they are entitled to fees because two agreements between the parties included fee-shifting provisions. But the contracts' fee-shifting provisions apply to plaintiffs' efforts to enforce obligations under the contracts and, considering that $2, 000, 000 of plaintiffs' recovery arose from tort claims, this case does not appear to primarily relate to plaintiffs' efforts to enforce contractual obligations. Tort obligations arise from the common law, not from a contract. And courts have denied fee requests predicated on contractual provisions where an action is "not properly construed as an action on the contract but instead one primarily seeking redress... for torts." Plaintiffs may be entitled to fees under Nevada law pursuant to the contractual shifting provision or statute, but plaintiffs have not provided adequate points and authorities on this issue.
Additionally, ruling on plaintiffs' motion is premature. There are pending motions for a new trial and for judgment as a matter of law that could impact whether plaintiffs are the prevailing parties and will likely impact the fees plaintiffs are owed (assuming they are).
I therefore deny plaintiffs' request for attorneys' fees and costs without prejudice. Plaintiffs may refile their motion after I rule on the other pending post-trial motions, ...