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Alliance Labs, LLC v. Stratus Pharmaceuticals, Inc.

United States District Court, Ninth Circuit

July 1, 2013

Alliance Labs, LLC, an Arizona limited liability company, and Enemeez, Inc., an Arizona corporation, Plaintiffs,
v.
Stratus Pharmaceuticals, Inc., a Florida corporation, Defendants.

ORDER AND OPINION Re: Application at Docket 127

JOHN W. SEDWICK, District Judge.

I. MOTION PRESENTED

At docket 127, plaintiffs Alliance Labs, LLC and Enemeez, Inc. ("plaintiffs") filed an application for attorneys' fees. Defendant Stratus Pharmaceuticals, Inc. ("defendant") filed a response in opposition at docket 131. Plaintiffs' reply is at docket 133, with supporting documentation filed at docket 134. Oral argument was not requested and would not assist the court.

II. BACKGROUND

At docket 106, plaintiffs filed a motion to compel pursuant to Rule 37 of the Federal Rules of Civil Procedure. The motion sought to compel defendant to answer interrogatories and produce documents after defendant failed to meet the deadline for such responses and then failed to meet the extended deadline agreed to by the parties during the meet and confer process. Defendant did not file an opposition to the motion to compel and consequently, at docket 119, the court granted plaintiffs' motion to compel and ordered defendant to provide its complete responses to plaintiffs' interrogatories and requests for production of documents. The court also granted plaintiffs' request for attorneys' fees incurred in connection with the motion to compel and directed plaintiffs to submit an application for fees to the court.

In the application, plaintiffs request $23, 071.50 for attorneys' fees related to their efforts to compel defendant to comply with its discovery obligations. In support of their request, plaintiffs attach the affidavit of one of their attorneys, Saul Perloff, as well as a chart summarizing the hours spent by the three attorneys working on the case and redacted copies of the invoices sent to plaintiffs. The affidavit states that the attorneys spent 41.20 hours on the discovery issue.[1] Specifically, the summary at docket 127-2 shows that partner Saul Perloff spent 9.7 hours on matters plaintiffs assert were related to discovery, senior counsel Andre Hanson spent 3.50 hours on such matters, and senior associate Katharyn Grant spent 28.20 hours on such matters.[2] Mr. Perloff's hourly rate is $750; Mr. Hanson's hourly rate is $525; and Ms. Grant's hourly rate is $495.[2] The affidavit states that these are "rates charged by law firms throughout the nation for similar legal services."[3]

III. STANDARD OF REVIEW

Under Rule 37, if a motion to compel is granted, sanctions in the form of "reasonable expenses" including attorneys' fees must be awarded against the party and attorney "whose conduct necessitated the motion."[4] The presumption in favor of an award of attorneys' fees serves a deterrent function by discouraging "unnecessary involvement by the court in discovery."[5] When assessing the reasonableness of a request for attorneys' fees, the court applies a two-part "lodestar" approach.[6] The court must first determine the "lodestar" figure by multiplying the number of hours reasonably expended by a reasonable hourly rate.[7] Second, the court "may adjust the presumptively reasonable' lodestar figure based upon the factors set forth in Kerr v. Screen Extras Guild, Inc . [8] The fee applicant has the burden of submitting evidence to support the hours and rates claimed.[9]

IV. DISCUSSION

A. Deferral

Defendant requests that the court defer the determination of attorneys' fees for the motion to compel in the interest of judicial economy, noting that the case could result in settlement which would obviate the need to rule on this application or that future motions for attorneys' fees and costs might be filed after judgment or discovery which would require the court to duplicate its efforts.

The court declines to defer the decision. As noted above, attorneys' fees as a sanction under Rule 37 serve a deterrent function by discouraging involvement of the court in discovery matters and discouraging future abuse of discovery. Regardless of what might happen in this case in the future, the court has granted plaintiffs' motion to compel and ordered that attorneys' fees be awarded. The only issue left for determination is the amount owed in relation to the motion to compel, and there is no reason to delay resolution of this issue.

B. Reasonable ...


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