Supplement to Notice of Motion and Motion for Sanctions

5/24/24

Additional Information: Declaration of Adam Tate

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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
Dirk O. Julander, Bar No. 132313
doj@jbblaw.com
Catherine A. Close, Bar No. 198549
cac@jbblaw.com
M. Adam Tate, Bar No. 280017
adam@jbblaw.com
JULANDER, BROWN & BOLLARD
9110 Irvine Center Drive
Irvine, California 92618
Telephone: (949) 477-2100
Facsimile: (949) 477-6355
Attorneys for Defendants
MCNAMARA and
JEREMY WHITELEY
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
BREAKING CODE SILENCE, a
California 501(c)(3) nonprofit,
Plaintiff,
vs.
MCNAMARA, an
Individual; JEREMY WHITELEY, an
individual; and DOES 1 through 50,
inclusive,
Defendants.
Case No. 2:22-cv-002052-SB-MAA
JOINT STIPULATION RE:
ATTORNEY’S FEES ON
SANCTIONS MOTION[Assigned to the Hon. Maria A. Audero] Case 2:22-cv-02052-MAA Document 211 Filed 05/24/24 Page 1 of 23 Page ID
#:8968
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
TABLE OF CONTENTS
Page
I. INTRODUCTORY STATEMENT…………………………………………………………………………… 1
A. Defendants’ Introductory Statement ………………………………………………………………. 1
B. Plaintiff’s Introductory Statement………………………………………………………………….. 1
II. ISSUES IN DISPUTE…………………………………………………………………………………………….. 2
A. Defendants’ Statement of Issues in Dispute…………………………………………………….. 2
1. Itemization of Attorney’s Fees. …………………………………………………………… 2
2. Whether attorneys’ fees expended for time spent on tasks other than
drafting a motion is recoverable under Rule 37(b)(c)(2). ……………………….. 2
B. Plaintiff’s Statement of Issues in Dispute ……………………………………………………….. 2
1. Whether BCS acted with substantial justification or other
circumstances make an award of attorney’s fees unjust………………………….. 2
2. Whether Defendants’ requested attorneys’ fees are unreasonable and
should be reduced……………………………………………………………………………… 2
3. Whether Defendants attorneys’ fees expended for time spent on
tasks other than drafting the Sanctions Motion is recoverable under
Rule 37(b)(c)(2)………………………………………………………………………………… 3
III. PARTIES’ CONTENTIONS AND POINTS AND AUTHORITIES…………………………….. 3
A. Issue No. 1 Itemization of Attorneys’ Fees……………………………………………………… 3
1. Defendants’ Contentions……………………………………………………………………. 3
2. Plaintiff’s Contentions……………………………………………………………………….. 7
B. Issue No. 2: Whether Attorneys’ Fees Expended for Time Spent on Tasks
Other Than Drafting a Motion is Recoverable Under Rule 37(b)(c)(2).) …………….. 8
1. Defendants’ Contentions and Points and Authorities …………………………….. 8
(a) The Fees Awardable under Rule 37(a)(5) and Rule
37(b)(c)(2) Are Different ………………………………………………………… 8
(b) The Court Specifically Stated That Fees Associated with the
August 9 IDC Would be Recoverable……………………………………… 11
2. Plaintiff’s Contentions……………………………………………………………………… 12
(a) Fees that Defendants also requested in connection with the
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
Slack Motion and Subpoena Motion are not recoverable. ………….. 12
(b) Fees incurred attending IDCs/hearings and working on tasks
related to Subpoena Motion are not recoverable……………………….. 12
(c) Fees incurred in connection with the Sanctions Motion are
unreasonable and should be reduced……………………………………….. 16
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
TABLE OF AUTHORITIES
Page
CASES
Andreoli v. Youngevity Int’l, Inc.
No. 16-cv-02922-BTM-JLB, 2019 U.S. Dist. LEXIS 100298, at *25 (S.D. Cal.
June 14, 2019) ……………………………………………………………………………………………………… 10
Lindsey v. Tacoma-Pierce Cty. Health Dep’t
195 F.3d 1065, 1074 (9th Cir. 1999)…………………………………………………………………………. 9
Premiere Innovations, Inc. v. Iwas Indus.
LLC, No. 07cv1083-BTM (BLM), 2009 U.S. Dist. LEXIS 142894, at *8 (S.D. Cal.
May 8, 2009) ……………………………………………………………………………………………………….. 10
Sanchez Y Martin, S.A. De C.V. v. Dos Amigos, Inc.
No. 17cv1943-LAB-LL, 2019 U.S. Dist. LEXIS 134739, at *28 (S.D. Cal. Aug. 9,
2019)…………………………………………………………………………………………………………………….. 9
STATUTES
Fed. R. Civ. P. 37 ………………………………………………………………………………………………………. 13, 15
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
JOINT STIPULATION OF PARTIES PURSUANT TO LOCAL RULE 37-2
I. INTRODUCTORY STATEMENT
A. Defendants’ Introductory Statement
On May 8, 2024, the Court issued a minute order directing the parties to
submit a Joint Stipulation on the issue of attorneys’ fees for the previously filed
Motion for Evidentiary and Monetary Sanctions under Rule 37 of the Federal Rules
of Civil Procedure (the “Sanctions Motion”). (Dkts. 98 and 210.) The Court
requested, for each individual who worked on the Sanctions Motion, an itemization
of time spent on each type of task related to the Sanctions Motion, excluding fees
that are duplicative of those are already requested related to the Subpoena Discovery
and the Slack Motion. (Dkt. 210, p. 4.) The Court also requested legal authority
supporting Defendants’ contention that, in addition to the time spent on the research
and preparation of the Sanctions Motion, Defendants are entitled to fees related to
(i) meeting and conferring with opposing counsel, (ii) appearing at informal
discovery conferences (“IDCs”), and (iii) analyzing Plaintiff’s document production.
(Id.) This Joint Statement addresses these issues.
B. Plaintiff’s Introductory Statement
As an initial matter, to the extent the Court has not yet ruled that Defendants
are entitled to an award of attorney’s fees in connection with their Sanctions Motion,
Rule 37 permits the Court to decline such an award if BCS acted with substantial
justification or other circumstances make an award of expenses unjust. To the
extent the Court finds that BCS failed to obey an order to provide or permit
discovery, such failure was substantially justified. BCS has undertaken significant
efforts to collect and provide extensive discovery pursuant to the Electronic
Discovery Order. BCS submits that its good faith and legally supported
interpretation of the terms of the Electronic Discovery Order, which the Court later
stated it disagreed with, should not be grounds for pecuniary penalty. An award of
attorney’s fees would also be unjust under the circumstances. As BCS has
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
explained, any non-de minimis award of attorney’s fees will likely force it into
bankruptcy or other financial predicament. Defendants will gain nothing from the
imposition of fees, but the imposition of fees would be ruinous for BCS.
Defendants request $72,779.00 in attorney’s fees. As Defendants point out,
they have already requested approximately $20,279.00 for attending IDCs as part of
their Slack Motion and Subpoena Motion. That amount—$20,279.00—should not
be considered as part of the instant Sanctions Motion.
Thus, for this Sanctions Motion alone, Defendants request approximately
$52,500.00, which should be the starting point for the Court’s analysis. This
amount is generally comprised of the following tasks:
• Preparing for and attending IDCs and hearings ($9,995.00)
• Work related to subpoena discovery and the Subpoena Motion ($17,367.50)
• Drafting the Sanctions Motion, supplemental declaration in support, and the
instant Joint Statement ($24,667.00)
For the reasons set forth herein, Defendants may only recover fees incurred in
connection with the third bullet. And even then, the fees incurred—$24,667.00—
are unreasonable and any award should be reduced to $8,386.78, or substantially
less.
II. ISSUES IN DISPUTE
A. Defendants’ Statement of Issues in Dispute
1. Itemization of Attorney’s Fees.
2. Whether attorneys’ fees expended for time spent on tasks other
than drafting a motion is recoverable under Rule 37(b)(c)(2).
B. Plaintiff’s Statement of Issues in Dispute
1. Whether BCS acted with substantial justification or other
circumstances make an award of attorney’s fees unjust.
2. Whether Defendants’ requested attorneys’ fees are unreasonable
and should be reduced.
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
3. Whether Defendants attorneys’ fees expended for time spent on
tasks other than drafting the Sanctions Motion is recoverable
under Rule 37(b)(c)(2).
III. PARTIES’ CONTENTIONS AND POINTS AND AUTHORITIES
A. Issue No. 1 Itemization of Attorneys’ Fees
1. Defendants’ Contentions
In connection with the originally filed Sanctions Motion, Defendants’ counsel
filed a declaration seeking a total of $23,680 in fees and costs. (Dkt 98-1.)
Following the in-person IDC on August 9, 2023, Defendants’ counsel submitted a
supplemental declaration which: (1) informed the Court of an additional attorney’s
fees that had been expended (largely from attending the in-person hearing); and (2)
provided a breakdown of the total time excluding the telephonic IDCs. (Dkt. 129.)
The attorneys’ fees requested in that declaration (excluding fees for future
work) were broken down as follows:
Task Tate
($470)
Close
($450)
Schwartz
($300)
Chamberlin
($150)
Saller
($200)
Total
Attending IDC
3 (Dkt 52)
2 2 2 0 0 $2,440
Attending IDC
4 (Dkt 54)
2.1 2.1 2.1 0 0 $2,562
Attending IDC
5 (Dkt 56)
2.1 2.1 2.1 0 0 $2,562
Attending IDC
6 (Dkt 58)
2 0 0 0 0 $940
Drafting the
Motion and
supporting
documents
(including
motion to seal)
15.0 3.7 0 28.3 4 $13,760
Preparing for 5.5 1.5 0 3.1 0 $3,725
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
the August 9,
2023 hearing
Attending the
August 9, 2023
hearing (in
person)
7 7 5 7 0 $8,990
Total $34,979
(Declaration of M. Adam Tate (“Tate Decl.”), ¶¶2-3.)
As reflected above, the only fees requested were fees associated with
attending hearings and drafting the motion. No fees were requested for “meeting and
conferring” outside of the Court-ordered IDCs or for reviewing documents.
After the in-person IDC on August 9, 2023, Defendants incurred additional
fees and costs; however, much of those fees have already been requested in
connection with the Slack Motion or the Subpoena Discovery. Excluding those fees,
Defendants incurred the following fees in connection with the Sanctions Motion:
2023
Task Tate
($470)
Close
($450)
Schwartz
($300)
Chamberlin
($150)
Saller
($200)
Total
Preparing the
supplemental
declaration.
(Dkt. 129)
0.5 3.5 0 4 0.5 $2,510.00
Attending
IDC 13 (Dkt.
142)
0 1.4 1.0 0 0 $930.00
Preparing the
Phase 1
Status Report
(Dkt. 168)
0.4 0.9 0 0 0 $593.00
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
2024
Task Tate
($510)
1
Close
($475)
Schwartz
($300)
Chamberlin
($185)
Saller
($210)
Total
Preparing
the Phase 1
Status
Report (Dkt.
168)
8.6 2 0 0 0.5 $5,441.00
Reviewing
and
analyzing
BCS’s
Response to
the Phase 1
Status
Report (Dkt.
192)
0.6 1 0 0 0 $781.00
Preparing
for the in
person
hearing on
March 25,
2024 (Dkt.
196)
7.0 0 0 0 0 $3,570.00
Attending
the in
person
hearing on
March 25,
2024 and
Conference
calls made
during the
hearing
7.0 1.0 0 0 0 $4,045.00
1 Defendants’ counsel’s hourly rates increased as of January 1, 2024.
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
(Dkt. 196)
Attending
the Status
Conference
on April 5,
2024 (Dkt.
196)
1.0 0 0 0 0 $510.00
Preparing
the
accounting
for the
Subpoena
Discovery
Fees
3.9 0 0 0 0 $1,852.50
Opposing
BCS’s
Motion to
Reduce Fees
(Dkt. 205.)
5.7 11.4 0 0 1.8 $8,700.00
Drafting the
Instant Joint
Statement
6.5 10.7 0 0 0 $8,397.00
(Tate Decl., ¶5.)
The total amount of fees being requested is $72,779.00. As noted in the
Declaration of M. Adam Tate, a portion of those fees associated with the attendance
at three of the informal discovery conferences and the in person hearing was also
requested in connection with either the Subpoena Discovery or the Slack Motion.
The fees for attending such hearings should be awarded to Defendants, but should
not be awarded twice. (Tate Decl., ¶6, Ex. 1.)
For the Court’s reference, attached as Exhibit 1 to the accompanying
Declaration of M. Adam Tate is a table from which the Court can determine how the
fees were classified into the above categories, and which will also assist the Court in
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
determining how much time was billed towards the Sanction Motion where the
timekeeper performed other tasks unrelated to the Sanction Motion on the same day.
Attached as Exhibits 2 through 12 are the invoices sent to Defendants which have
been subsequently highlighted and redacted. (Tate Decl., ¶7, Exs. 2-12.)
2. Plaintiff’s Contentions
Defendants request $72,779.00 in attorney’s fees. As Defendants point out,
they have already requested approximately $20,279.00 for attending IDCs as part
of their Slack Motion and Subpoena Motion. That amount—$20,279.00—should
not be considered as part of the instant Sanctions Motion. See Dkt. 210 at 4
(“Defendants are cautioned that they may not request fees that are duplicative of
those already requested as to the Subpoena Motion and the Slack Motion.”).
Thus, for this Sanctions Motion alone, Defendants request approximately
$52,500.00, which should be the starting point for the Court’s analysis. This
amount is generally comprised of the following tasks:
• Preparing for and attending IDCs and hearings ($9,995.00)
• Work related to subpoena discovery and the Subpoena Motion ($17,367.50)
o Preparing Phase 1 status report related to subpoena discovery
($6,034.00)
o Reviewing BCS’ response to Defendants’ Phase 1 status report
($781.00)
o Preparing the accounting for subpoena discovery fees ($1,852.50)
o Opposing BCS’ motion to reduce fees related to subpoena discovery
($8,700.00)
• Drafting the Sanctions Motion, supplemental declaration in support, and the
instant Joint Statement ($24,667.00)
For the reasons set forth below, Defendants may only recover fees incurred
for drafting the Sanctions Motion, supplemental declaration in support, and the
instant Joint Statement (bullet 3 above). And those fees should be reduced to
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
$8,386.78, or substantially less.
B. Issue No. 2: Whether Attorneys’ Fees Expended for Time Spent on
Tasks Other Than Drafting a Motion is Recoverable Under Rule
37(b)(c)(2).)
1. Defendants’ Contentions and Points and Authorities
(a) The Fees Awardable under Rule 37(a)(5) and Rule
37(b)(c)(2) Are Different
Generally speaking, Rule 37(a) governs situations where a party has failed to
make a disclosure in response to discovery; whereas Rule 37(b) governs situations
where a party has failed to comply with a court order.
While both Rule 37(a) and 37(b) state that the Court must issue sanctions
against the culpable party, the language regarding what sanctions are awardable
differs. Rule 37(a)(5) provides that the Court must require the party whose conduct
necessitated bringing the motion, its attorney, or both, to pay the movant’s
reasonable expenses “incurred in making the motion.” The statute states (emphasis
added):
If the Motion Is Granted (or Disclosure or Discovery Is
Provided After Filing). If the motion is granted—or if the
disclosure or requested discovery is provided after the
motion was filed—the court must, after giving an
opportunity to be heard, require the party or deponent
whose conduct necessitated the motion, the party or
attorney advising that conduct, or both to pay the movant’s
reasonable expenses incurred in making the motion,
including attorney’s fees.
Rule 37(b)(2)(c), by contrast, is not limited to expenses incurred in making
the motion. Rather, Rule 37(b)(2)(c) requires the Court to order a party, its attorney,
or both, who has failed to comply with a court order to pay the reasonable expenses,
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
including attorneys’ fees, “caused by the failure” to comply with the court order.
The statute states (emphasis added):
Payment of Expenses. Instead of or in addition to the
orders above, the court must order the disobedient party,
the attorney advising that party, or both to pay the
reasonable expenses, including attorney’s fees, caused by
the failure, unless the failure was substantially justified or
other circumstances make an award of expenses unjust.
A general principle of statutory construction is that where a different language
is used within the same statute, the differences are presumed to have meaning.
Lindsey v. Tacoma-Pierce Cty. Health Dep’t, 195 F.3d 1065, 1074 (9th Cir. 1999).
Defendants submit that the most logical reading of Rule 37 is that (1) under rule
37(a)(5) a party can only recover those fees incurred in bringing a motion, but (2)
under Rule 37(b)(2) a party can recover all of its “reasonable expenses” incurred as
result of the failure to comply with the Court order “instead of or addition to” the
fees awardable under Rule 37(a)(5). Complying with Court ordered “meet and
confer” obligations and attending Court ordered IDCs and Status Conferences are
“reasonable expenses” within the meaning of the statute “in addition to” those
awardable under Rule 37(a)(5).
The Southern District of California’s decision in Sanchez Y Martin, S.A. De
C.V. v. Dos Amigos, Inc., No. 17cv1943-LAB-LL, 2019 U.S. Dist. LEXIS 134739,
at *28 (S.D. Cal. Aug. 9, 2019) is highly instructive and supports Defendants’
interpretation. In Sanchez, the Plaintiff brought several discovery motions. In
analyzing the first of the motions brought under Rule 37(a), the Court noted that
Rule 37(a)(5)(A) only allowed for reasonable expenses “incurred in making the
motion,” and, accordingly, the Court declined to award sanctions for the time spent
on meeting and conferring regarding discovery disputes, and reviewing discovery
responses and document productions since such costs are normal expenses in the
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
course of litigation. Id. at 27. However, when analyzing the second motion brought
under Rule 37(b)(2)(c), the Court noted that the statute authorized fees “caused by
the failure” to comply with court order. The Court then found that (1) meeting and
conferring, (2) legal research, (3) opposing an ex parte application, and (4) drafting
the motion for sanctions were all “reasonable expenses” under Rule 37(b)(2)(c). Id.
at 28.
Defendants acknowledge that there are many cases, including cases within
this Circuit, where courts have refused to award fees for meeting and conferring or
attending informal discovery conferences under Rule 37(a)(5). However,
Defendants are not aware of any case within this Circuit which has explicitly
reached the conclusion that attending Court-ordered IDCs is not a “reasonable
expense” within the meaning of Rule 37(b)(2)(c). By contrast, there are a handful of
cases within this Circuit where the court has found that the time spent “meeting and
conferring” on discovery motions is awardable under Rule 37(b)(2)(c) as it is a
“reasonable expense.” See, e.g. Andreoli v. Youngevity Int’l, Inc., No. 16-cv-02922-
BTM-JLB, 2019 U.S. Dist. LEXIS 100298, at *25 (S.D. Cal. June 14, 2019)
(awarding attorney’s fees for meet and confer efforts under Rule 37(b)(2)(c));
Premiere Innovations, Inc. v. Iwas Indus., LLC, No. 07cv1083-BTM (BLM), 2009
U.S. Dist. LEXIS 142894, at *8 (S.D. Cal. May 8, 2009) (same).
As outlined in the Sanctions Motion, the Sanctions Motion was primarily
based on BCS’s violation of Court orders. In this respect, the Sanctions Motion
provided a chart showing the several instances where BCS violated the Court’s
orders leading up to the filing of the Sanctions Motion. (Dkt. 98. pp. 52-54.)
On August 9, 2023, the Court held the first in-person IDC at which BCS
violated yet another Court order by failing to have Dennis Kiker attend. (See Dkt.
137, pp. 3-4.) Following the hearing, the Court issued an interim order which laid
out a stipulated discovery plan (the “Interim Order”). (Dkt 132.) Unfortunately, BCS
continued to disobey the Court’s directives, despite the Court’s warnings.
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
BCS violated the Interim Order in at least three respects. First, the Interim
Order stated that, for each Custodian who indicated that he or she possessed BCS
related documents, BCS shall collect the documents and produce them by no later
than September 9, 2023. (Dkt. 132, ¶3.) However, BCS did not produce anything
from Jesse Jensen or Arianna Conroyd, despite the fact they both indicated that they
possessed BCS related documents. Second, as outlined in Defendants’ Phase 1
Status Report, Defendants have a good faith basis to believe that Jennifer Magill and
Vanessa Hughes failed to produce all of their responsive documents. (Dkt. 168.)
Third, the Interim Order required BCS to provide a privilege log to be served
together with the production. (Dkt. 132, ¶3.) BCS never provided the privilege log.
(Tate Decl., ¶11.)
In short, BCS repeatedly violated the Court’s orders. BCS’s violations of the
Court’s orders resulted in Defendants incurring “reasonable expenses” within the
meaning of Rule 37(b)(2). BCS and its attorneys should be responsible for paying
for such expenses – not Defendants.
(b) The Court Specifically Stated That Fees Associated with
the August 9 IDC Would be Recoverable
The Joint Stipulation Regarding Evidentiary and Monetary Sanctions Under
FRCP 37 was filed on July 14, 2023. After the Joint Stipulation was filed, on
August 7, 2023, the Court scheduled an in-person IDC for August 9, 2023. (Dkt.
114.) The Court’s Scheduling Notice for the August 9 IDC mandated that: “A
representative of Plaintiff is ORDERED to appear in person. All attorneys involved
in any way with the Motion and the discovery that is the subject of the Motion are
ORDERED to appear in person.” (Id. [caps in original; bold italics added].) Because
attorneys M. Adam Tate, Catherine A. Close, Adam J Schwartz and Rebekah G.
Chamberlin were all in some way involved in the Joint Stipulation or the discovery
that was the subject of thereof, all four appeared in person at the August 9 IDC as
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
ordered, three travelling from South Orange County. (See Dkt. 120, p. 1.)
At the August 9 IDC, the Court advised BCS that it was going to lose the
motion and that the attorneys’ fees for attending the August 9 in person IDC were
recoverable “because [they] came from the motion.” (Dkt. 137, Ex. A, p. 55:8-23 [“I
would count today as recoverable”].) Accordingly, the Court has already stated that
the fees associated with attending the August 9 IDC are recoverable. Though the
Court did not specify whether the fees would be recoverable in connection with the
Subpoena Discovery or the Sanctions Motion, one way or another they should be
awarded.
2. Plaintiff’s Contentions
If the Court decides to award attorney’s fees to Defendants in connection with
the Sanctions Motion, the award should be reduced from the requested $72,779.00
to $8,386.78, or substantially lower, for the following reasons.
(a) Fees that Defendants also requested in connection with the
Slack Motion and Subpoena Motion are not recoverable.
Defendants have already requested approximately $20,279.00 of $72,779.00
in fees as part of their Slack Motion and Subpoena Motion. That amount—
$20,279.00—should not be considered as part of the instant Sanctions Motion. See
Dkt. 210 at 4 (“Defendants are cautioned that they may not request fees that are
duplicative of those already requested as to the Subpoena Motion and the Slack
Motion.”). The Court may consider those fees in connection with its adjudication of
the Slack Motion and Subpoena Motion.
(b) Fees incurred attending IDCs/hearings and working on
tasks related to Subpoena Motion are not recoverable.
Defendants seek to recover (i) $9,995.00 for preparing for and attending IDCs
and hearings, and (ii) $17,367.50 for work related to the Subpoena Motion and
Subpoena Discovery. None of this $27,362.50 is recoverable.
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
Defendants concede that Rule 37(a) does not permit them to recover fees for IDCs
or Subpoena Motion-related work because the statute limits recovery to only those
fees incurred “in making the motion” (i.e., the Sanctions Motion). See p. 10, supra
(“Defendants acknowledge that there are many cases, including cases within this
Circuit, where courts have refused to award fees for meeting and conferring or
attending informal discovery conferences under Rule 37(a)(5).”).
Searching for any hook, Defendants argue that they can instead recover such
fees under Rule 37(b) because BCS violated discovery orders. Rule 37(b) states that
if a party “fails to obey an order to provide or permit discovery,” the Court must
order the party and/or its counsel to pay “the reasonable expenses, including
attorney’s fees, caused by the failure, unless the failure was substantially justified or
other circumstances make an award of expenses unjust.” (Fed. R. Civ. P.
37(b)(2)(a), (c).)
Defendants argue that BCS’s violations of discovery orders “caused”
Defendants to incur recoverable attorney’s fees related to (i) preparing for and
attending IDCs and hearings, and (ii) drafting submissions related to Subpoena
Discovery. Defendants’ arguments fail for the following reasons.
First, during the August 9, 2023 IDC, the Court stated, “Meeting and
conferring is not recoverable, and appearing at an informal discovery conference is
not recoverable.” (Dkt. 137 at 55:16-17.)
Nonetheless, Defendants seek attorney’s fees for meeting and conferring and
attending IDCs. Defendants cite no authority for their novel proposition that fees
incurred from attending Court-ordered IDCs are chargeable to the opposing party
that was also ordered by the Court to attend. Rather, Defendants cite only “a
handful of cases” related to fee recovery for time spent meeting and conferring.
This authority should not control here because meeting and conferring and attending
Court-ordered IDCs are materially different events under materially different
circumstances. The Court should decline to create new Rule 37(b) law in this
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
regard.2

Second, as BCS explained at length in the original joint statement, it did not
violate the Court’s orders as Defendants alleged. Defendants’ attempts herein to
drum up additional examples of alleged order violations are equally specious. For
instance, Defendants argue that BCS violated the Interim Order (Dkt. 132) by not
producing documents held by third-parties Jesse Jensen or Arianna Conroyd.
However, in recognition of the reality that BCS could not compel Mr. Jensen or Ms.
Conroyd to produce documents, the Interim Order set forth a subpoena framework
that would take effect if third-parties such as Mr. Jensen and Ms. Conroyd did not
produce documents. Defendants then proceeded under that subpoena framework.
BCS complied with its obligations under the Interim Order by requesting documents
from third-parties such as Mr. Jensen and Ms. Conroyd. The fact that some did not
produce documents is not a violation on BCS’s part, particularly since the Interim
Order recognized and provided for that possibility.
The same is true for Defendants’ frivolous example that BCS also violated the
Interim Order because they believe “Jennifer Magill and Vanessa Hughes failed to
produce all of their responsive documents.” If Defendants were unsatisfied with a
third-party’s document production, the Interim Order authorized them to issue a
subpoena to any such third-party. Defendants did so.
Defendants’ claim that BCS violated the Interim Order is either purposefully
disingenuous or based on a (willful) misreading of the Interim Order.
2
Defendants rely on a comment the Court made at the August 9, 2023 IDC (“I
would say this one [IDC] is because this came from the motion”) to argue that
Defendants may recover the fees incurred by four attorneys attending the IDC.
(Dkt. 137 at 55:17-18.) Of course, in the nine months between that IDC and this
submission, there have been significant developments and the parties’ circumstances
have changed drastically such that the Court’s comment at the time should not be
applicable now. If, however, the Court adheres to its comment, BCS requests that
the Court award only the fees incurred by Mr. Tate attending the IDC ($3,290.00)
and not the fees incurred by the other three attorneys who also attended ($7,350.00).
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Third, Defendants conclude that “BCS’s violations of the Court’s orders
resulted in Defendants incurring ‘reasonable expenses’ within the meaning of Rule
37(b)(2),” but they make no attempt to explain how BCS’s alleged violations
“caused” Defendants to incur the attorney’s fees they now seek to recover. For
example, how did Mr. Kiker’s non-appearance at the August 9, 2023 IDC cause
Defendants to incur attorney’s fees? How did BCS not providing a privilege log
with one of its productions cause Defendants to incur attorney’s fees?
Inherent in the statute’s causation language is some necessary limit on
proximate cause. Defendants fail to explain this causal link with the alleged
violations. Rather, Defendants are apparently treating this Sanctions Motion as a
blank check without regard to the limitations imposed by Rule 37.
This is particularly evident with respect to the fees related to Subpoena
Discovery and the Subpoena Motion. Defendants are requesting $17,367.50 for
subpoena-related tasks that have nothing to do with the Sanctions Motion, including
$8,700.00 for drafting an opposition to BCS’s Motion to Reduce Defendants’
Requested Attorneys’ Fees and Costs Related to Subpoena Discovery (Dkt. 203) and
$1,852.50 for preparing the accounting for Subpoena Discovery fees they sought in
connection with their Subpoena Motion. Defendants simply assume—without
explanation—that all of this work somehow flows from BCS’s conduct that gave
rise to the Sanctions Motion such that BCS “caused” them to incur these requested
attorney’s fees. If this is Defendants’ theory, it is attenuated at best and flouts the
causation language of the statute. Defendants have failed to meet their burden to
establish that these fees are recoverable.
Fourth, Rule 37(b) states that attorney’s fees may not be imposed if the
failure “to obey an order to provide or permit discovery” was “substantially justified
or other circumstances make an award of expenses unjust.” (Fed. R. Civ. P.
37(b)(2)(a), (c).) To the extent the Court finds that BCS failed to obey an order to
provide or permit discovery, such failure was substantially justified. BCS has
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
undertaken significant efforts to collect and provide extensive discovery pursuant to
the Electronic Discovery Order. BCS submits that its good faith and legally
supported interpretation of the terms of the Electronic Discovery Order, which the
Court later stated it disagreed with, should not be grounds for pecuniary penalty.
An award of attorney’s fees would also be unjust under the circumstances.
As BCS has explained, any non-de minimis award of attorney’s fees will likely
force it into bankruptcy or other financial predicament. Defendants will gain
nothing from the imposition of fees, but the imposition of fees would be ruinous for
BCS.
(c) Fees incurred in connection with the Sanctions Motion are
unreasonable and should be reduced.
Defendants seek to recover $24,667.00 for drafting the Sanctions Motion and
related documents, including this Joint Statement. Specifically, Defendants spent
76.7 hours on the following tasks:
• Drafting Sanctions Motion – 51 hours (3 lawyers, 1 paralegal) – $13,760.00
• Drafting supplemental declaration – 8.5 hours (3 lawyers, 1 paralegal) –
$2,510.00
• Drafting instant Joint Statement – 17.2 hours (2 lawyers) – $8,397.00
This amount is unreasonable and should be reduced. With respect to the
instant Joint Statement, Defendants simply copy and pasted the section on
recovering fees for meet and confers/IDCs from their Slack Motion. See Dkt. 204 at
7-9. Defendants present minimal additional argument. The vast majority of
Defendants’ submission is summarizing and compiling invoices and time entries.
Notwithstanding that this is purely an administrative task, two lawyers amassed 17
hours doing it rather than delegating the work to the same paralegal they have used
for other similar tasks. BCS should not have to bear all of this cost.
With respect to the Sanctions Motion and supplemental declaration, charging
BCS for approximately 60 hours is unreasonable. The Sanctions Motion presented
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
only a handful of discovery issues. Nonetheless, Defendants structured the related
Joint Statement in such a way that made it redundant, inefficient, and unnecessarily
long, all of which apparently contributed to counsel spending far too much time on
it. The issues could have, and should have, been addressed in a fraction of the time.
As a result, BCS requests that the fees Defendants incurred in connection with
the Sanctions Motion and related documents be reduced by at least 66% to
$8,386.78, at most. This reduction is reasonable because Defendants’ counsel spent
an excessive amount of time on the Sanctions Motion, up to three attorneys
performed the same or similar tasks in connection with the Sanctions Motion when
one attorney would have been sufficient, and the instant Joint Statement should have
required very minimal attorney time.
IT IS SO STIPULATED.
DATED: May 24, 2024 JULANDER, BROWN & BOLLARD
By: /s/ M. Adam Tate
M. Adam Tate
Catherine Close
Attorneys for Defendants
MCNAMARA and
JEREMY WHITELEY
DATED: May 24, 2024 DLA PIPER LLP
By: /s/ Jason Lueddeke
John Gibson
Jason Lueddeke
Attorneys for Plaintiff
BREAKING CODE SILENCE
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JOINT STIPULATION RE: ATTORNEYS’ FEES ON SANCTIONS MOTION
ATTESTATION
All other signatories listed, and on whose behalf the filing is submitted,
concur in the filing’s content and have authorized the filing.
/s/ M. Adam Tate
M. ADAM TATE
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CERTIFICATE OF SERVICE 1610048138.1
CERTIFICATE OF SERVICE
I hereby certify that on this 24th day of May, 2024, I electronically filed the
foregoing paper(s) with the Clerk of the Court using the ECF system which will
send notification to all parties of record or persons requiring notice.
/s/ Helene Saller
Helene Saller
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