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Thursday, February 27, 2014

In re One Infant Child, 2014 WL 704037 (S.D.N.Y.) [Fees and Costs]

In In re One Infant Child,  2014 WL 704037 (S.D.N.Y.) the District Court awarded the successful petitioner attorneys fees of  $ 217,949.56, attorney's costs of $1,274.08, fact witness fees of $6,279.52, expert witness fees of $2,400, transcript fees of $1,465.20, lodging and travel fees of     $20,451.88 and Investigative fees of  $33,246.38 . [See Souratgar v. Fair, 12 Civ. 7797 (PKC), 2012 WL 6700214, at *1 (S.D.N.Y. Dec. 26, 2012) aff’d Souratgar v. Lee, 720 F.3d 96 (2d Cir.,2013)]. 
           The District Court observed that the 'lodestar' approach is the proper method for determining the amount of reasonable attorneys' fees once a court orders the return of the child under the Hague Convention." (Citing Knigge v. Corvese, 01 Civ. 5743 (DLC), 2001 WL 883644, at *1 (S.D.N.Y. Aug. 6,2001) (quoting Distler v. Distler, 26 F. Supp. 2d 723, 727 (D.N.J. 1998). It observed that "Both [the Second Circuit] and the Supreme Court have held that the lodestar-the product of a reasonable hourly rate and the reasonable number of hours required by the case-creates a "presumptively reasonable fee." (Citing Millea v. Metro-North R. Co., 658 F.3d 154, 166 (2d Cir. 2011). The presumptively reasonable attorney's fee is calculated by setting the reasonable hourly rate and multiplying it by the hours spent on the client's matter. (Citing Arbor Hill Concerned Citizens Neighborhood Ass'n v. Cnty. of Albany and Albany Cnty. Bd. of Elections, 522 F.3d 182, 186 (2d Cir. 2008). "The reasonable hourly rate is the rate a paying client would be willing to pay." Id. at 190. The Court should endeavor to determine "the market rates prevailing in the community for similar services by lawyers of reasonably comparable skill, experience, and reputation." Gierlinger v. Gleason, 160 F.3d 858, 882 (2d Cir. 1998) (internal quotation marks omitted). The court "should ... bear in mind that a reasonable, paying client wishes to spend the minimum necessary to litigate the case effectively." Arbor Hill, 522 F.3d at 190. The starting point is a determination of whether the proposed hourly rate is reasonable in this district for the type of services and work. Id. In setting the reasonable hourly rate, Arbor Hill approves the use of the twelve Johnson factors cited in Arbor Hill and several related considerations: "the complexity and difficulty of the case, the available expertise and
capacity of the client's other counsel (if any), the resources required to prosecute the case effectively (taking account of the resources being marshaled on the other side but not endorsing scorched earth tactics), the timing demands of the case, whether an attorney might have an interest (independent of that of his client) in achieving the ends of the litigation or might initiate the representation himself, whether an attorney might have initially acted pro bono (such that a client might be aware that the attorney expected low or non-existent remuneration), and other returns (such as reputation, etc.) that an attorney might expect from the representation." rd. at 184.2 "[Considerations concerning the quality of a prevailing party's counsel's representation 2 See Johnson v. Ga. Highway Express, Inc., 488 F.2d 714 (5th Cir. 1974), abrogated on other grounds by Blanchard v. Bergeron, 489 U.S. 87, 92-93, 96 (1989). "The twelve Johnson factors are: (I) the time and labor required; (2) the novelty and difficulty of the questions; (3) the level of skill required to perform the legal service properly; (4) the preclusion of employment by the attorney due to acceptance of the case; (5) the attorney's customary hourly rate; (6) whether the fee is fixed or contingent; (7) the time limitations imposed by the client or the circumstances; (8) the amount involved in the case and the results obtained; (9) the experience, reputation, and ability of the attorneys; (10) normally are reflected in the reasonable hourly rate." Perdue v. Kenny A ex reI Winn, 559 U.S. 542, 553 (2010).

       In support of his attorneys' proposed hourly rates, Souratgar's counsel submitted the affirmation of a matrimonial law attorney  who attested that counsels billable rates were reasonable in this district for attorneys of their experience and qualifications. The district court appeared to discounted his affirmation because he did not state whether he was experienced in Hague Convention litigation or whether his hourly rate was consistent with the rates of other attorneys in this district who practice in this niche area of law.

The district court pointed out that in determining the reasonableness of the requested attorneys' fees, the Court considers the quality of the work done by the attorneys. The Court concluded that a rate of $425.00 per hour was reasonable on this record for lead counsel and $300.00 was reasonable for his associate. The Court awarded attorneys fees of $217,949.56. 

The court held that time billed for dealing visitation disputes during the pendency of the proceeding is not recoverable. See Saldivar v. Rodela, 894 F. Supp. 2d 916, 937 (W.D. Tex. 2012) (denying fees and costs incurred in obtaining a court order providing for increased visitation hours), Aldinger v. Seigler, 338 F. Supp. 2d 296,298 (D.P.R. 2004), affd, 157 Fed App'x 317 (1st Cir. 2005) (reducing fees in part because at least 20 billable hours were spent on visitation issues). 

       The application sought reimbursement for legal services by foreign attorneys, Gomez and Vasu.  Gomez was an Advocate and Solicitor who had practiced law in Singapore for 26 years.  Vasu has practiced law in Singapore for 16 years. Gomez and Vasu advised Souratgar’s attorney  on the laws of Singapore and Malaysia, discussed  legal strategy with him, and reviewed drafts of submissions to this Court and the Second Circuit. The court held that they were not entitled to be compensated for legal advice and strategy regarding Souratgar's case in the district court, nor may they recover for coordination between proceedings in the district court and other foreign tribunals. "[The foreign attorney] did not represent [Petitioner] in the instant action before this Court. There is no showing that [the foreign attorney] is admitted to practice in [this state] or before this Court. [Petitioner] has not submitted any authority which allows this Court to award fees and costs incurred by an attorney who does not represent a patty in an action before this Court." Freier v. Freier, 985 F. Supp. 710,714 (B.D. Mich. 1997). But see Distler v. Distler, 26 F. Supp. 723,728 (D.N.J. 1998) (awarding fees for a foreign attorney who provided legal services to the petitioner in support of the Hague Convention petition). 

Gomez testified as a fact witness, not as an expert witness, during the
evidentiary hearing. Souratgar v. Fair, 12 Civ. 7797 (PKC), 2012 WL 6700214, at *1 (S.D.N.Y. Dec. 26, 2012). She  was entitled to reimbursement for travel expenses and lost time due to her testimony. Prasad v. MML Investors Services, Inc., 04 Civ. 380 (RWS), 2004 WL 1151735, at *5 (S.D.N.Y. May 24,2004) ("[T]he federal courts ... are generally in agreement that a witness may properly receive payment related to the witness' expenses and reimbursement for time lost associated with the litigation."). The Court awarded fact witness fees of $6,279.52. The Court held that  Gomez's business class flight was not compensable at the rate of  $ 8,113.00.  28 U.S.C. § l82l(c)(1) provides that a witness shall be paid for "the actual expenses of travel" at the "most economical rate reasonably available." See Salvidar, 894 F. Supp. 2d at 947 (applying 28 U.S.C. § 1821 to a Hague Convention case). Gomez's nightly hotel rate of $369.00 was within the range of reasonableness, and the Court compensated her for three nights.  Gomez charged Souratgar a daily fee of $783.63 per day, which she attested was a reduction of her usual rate. The Court found this rate reasonable compensation for her lost time. It observed that the average price of a hotel room in New York City in 2012 was $281.00. See "NYC Statistic page" NYC: The Official Guide, http://www.nycgo.comlarticles/nyc-statistics-page (last accessed January 30,2014). The hearing  was held in the month of December which is a peak period and the hearing was convened on relatively short notice. Accordingly, one would expect a higher than average rate.

Souratgar requested expert fees in the amount of $21,500. He sought $13,000 in
fees for the expert testimony of Awad, an expert on Singapore and Malaysian law. The Court found  that "To determine whether an expert's proposed rate is reasonable, courts in this Circuit are guided by eight factors: (1) the [expert]'s area of expertise, (2) the education and training that is required to provide the expert insight that is sought, (3) the prevailing rates for other comparably respected available experts, (4) the nature, quality and complexity of the discovery responses provided, (5) the cost of living in the particular geographic area, (6) the fee being charged by the expert to the party who retained him, (7) fees traditionally charged by the expert on related matters, and (8) any other factor likely to be of assistance to the court in balancing the interests implicated by Rule 26." Matteo v. Kohl's Dep't Stores, Inc., 09 Civ. 7830 (RJS), 2012 WL 5177491, at *5 (S.D.N.Y. Oct. 19,2012), affd, 533 Fed App'x 1 (2d Cir. 2013). 

Awad testified at trial regarding Islamic family law and the Singapore legal system. He testified that he is admitted to practice law in New York and New Jersey, and that a substantial part of his practice is devoted to matrimonial litigation. He also testified that he has certain expertise in Islamic family law and the family laws of Muslim countries. He stated on the record that he billed at the rate of $550.00 per hour. The court pointed out that in support of this motion, Souratgar  provided no evidence of Awad's rate, the services provided, or any data regarding comparable experts. He did  not establish what work Awad conducted that would make his fees reasonable. Souratgar did not provide relevant documentation of the services provided to him by Awad, or any evidence of Awad's compensation rate. The Court held that "In the face of very limited evidence, a court may, in its discretion, simply apply an across-the-board reduction of expert's fees. Matteo, 2012 WL 5177491, at *5.  The Court awarded expert witness fees of $2,400.

The Court found that there is no authority allowing a prevailing party to recover expert witness fees of a witness who did not testify at trial." Freier v. Freier, 985 F. Supp. 710, 714 (E.D. Mich. 1997). Accordingly, Souratgar's request for Dr. Lubit's fee ( a child psychologist)  was denied.

Souratgar sought $2,038.00 for his round trip flight from Singapore to New York,
$1,479.00 for his change of flight from New York to Singapore and his son's return flight to Singapore. The Court granted his motion for travel expenses in the amount 
of  $3,517.00 

Souratgar sought lodging fees totaling $22,579.84. The Court found that Souratgar did not establish that the cost of his accommodations was reasonable. Souratgar stayed in Kingston, New York, during the proceedings, which is located approximately 100 miles from the courthouse located in Manhattan. Souratgar only argued that the costs of lodging were reasonable because of the "cost of living in the New York metropolitan area."  Souratgar did not demonstrate that an average rent of approximately $2,800.00 per month in Kingston, New York was reasonable. Therefore the  Court found that a reduction in  the lodging costs of 25% was appropriate given the lack of documentation supporting the rate as reasonable. The Court granted Souratgar's motion for lodging expenses in the amount of $16,934.88.

The court noted that a petitioner may be entitled to recover investigation costs if such costs are "necessary" to secure the return of the child. Neves v. Neves, 637 F. Supp. 2d 322, 344 (W.D.N.C. 2009) (finding, after reviewing supporting documentation, that an expense of $10,324.65 in investigative fees was reasonable and necessary). The Court reviewed the supporting documentation for the investigative fees.
While some award of investigative fees was appropriate, it found that the fees should be reduced, as not all expenses were necessary to secure the child's return and Souratgar did not demonstrate that the rates charged by the investigators were reasonable. Souratgar submitted invoices from three separate investigative firms. The Court did not find that investigative fees incurred after the issuance of the warrant were necessary to secure the return of the child. Just as attorney's fees regarding visitation are not recoverable under the ICARA, investigator hours supervising visitation and other investigative work after the issuance of the warrant are not recoverable. Additionally, investigative hours spent conducting background checks on potential lawyers to bring the petition were not necessary to secure the return of the child, and are not compensable. Souratgar did not demonstrate the reasonableness of the rates paid for the investigative services. The court noted that "If the parties do not provide sufficient evidence to support the moving party's interpretation of a reasonable rate, a court may use its discretion to determine a reasonable fee.  Matteo, 2012 WL 5177491, at *5 (discussing expert and expert investigator fees). The Court concluded that of the $92,958.10 in fees incurred, $44,328.50 were necessary costs to secure the child's return. 

The Court pointed out that Fair argued that  awarding any fee would be clearly inappropriate  because: (1) of Souratgar's past abusive behavior towards Fair. (2) her inability to pay; (3) her son would be adversely affected by any award because further financial strain will impede her ability to pay her Singapore counsel, which would prevent her from obtaining representation in future  custody hearings and may result in the complete loss of the child's relationship with Fair. 

  The Court found that Souratgar engaged in abusive conduct towards Fair.  
Souratgar v. Fair, 2012 WL 6700214, at *11. But Fair did not establish that the past abuse in this case made an award of fees clearly inappropriate. Fair did not establish that the past abuse of her was causally related to her decision to  leave Singapore with her son in violation of a court order issued by a court of that country. 

 Fair asserted that she lacked the financial resources to pay any award. She was represented by pro bono counsel. Fair attested that  pro bono representation in Singapore was unavailable to her. She stated that she owed approximately $17,600 in car payments and $3,820.45 in attorney's fees to the law firm that represented her in proceedings in Singapore. Fair had not worked in 5 years. She did  not provide the Court with any other information regarding her current income. Her Central Provident Fund Board  Account, contained $149,558.59. While it ws not clear that Fair would be able to access the funds in her CFP account in the near future, she did not demonstrate that she would never have access to those funds.   Fair owned a one-third interest in a family property in Malaysia. Fair asserteds that she held this interest in trust for 
her brother; however, Fair came forward with nothing other than her say-so to support the claim of trust. In the absence of documentation for the alleged trust arrangement, she failed to establish that this interest would not be properly reachable by the judgment.

Fair's claim as to the effects in custody proceedings if an award of fees was 
entered against her was speculative. Fair provided the Court with a bill from her Singapore  lawyers  but did not demonstrate, beyond speculation, that she would 
be unable to acquire representation in the Singapore proceedings as a result of a fee award.  Fair did not provide the Court with any concrete information about how her lack of funds might affect her under Singapore or Malaysian law. She did not endeavor to explain whether and to what extent her wages may be subject to garnishment or pension assets reached, whether and to what extent her interest in property jointly owned with others in Malaysia could be reached, whether and to what extent a judge presiding over a divorce proceeding with her present husband, Souratgar, could take account of the judgment in adjudicating her rights to any marital or other property. Instead, Fair speculated that she was likely to face jail time because Mr. Souratgar's Singapore lawyer has made it clear that Souratgar intends to pursue his contempt of court application". Fair did not proved the Court with any documentation of her assets or income beyond the CFP account and the deed of her interest in her family's home. 

The court concluded that Fair had not established that an award would be clearly inappropriate, and that she wrongfully removed her son from Singapore and absconded to the United States. By doing so, she violated an order of the Court in Singapore and demonstrated an indifference to whether the young boy would ever see his father again. An unreduced award  on the basis of Fair's inability to pay would not be "clearly inappropriate."

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