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Autism Homes Alliance, LLC v. 6146-48 N. Oakley Condominium Association

United States District Court, N.D. Illinois, Eastern Division

July 31, 2018

AUTISM HOMES ALLIANCE, LLC and AMERICAN METRO BANK, Plaintiffs,
v.
6146-48 N. OAKLEY CONDOMINIUM ASSOCIATION, Defendant. Lawyer Hours Hourly Rate Totals

          MEMORANDUM OPINION AND ORDER

          Sharon Johnson Coleman, Judge

         The plaintiffs, Autism Homes Alliance, LLC and American Metro Bank, brought this action against the 6146-48 N. Oakley Condominium Association alleging violations of the Fair Housing Act. Default judgment was entered in the plaintiffs favor, along with an award of attorney's fees and costs. The Condo Association subsequently raised a number of challenges to the validity of the default judgment, all of which have been denied. The plaintiffs now move to recover the attorney's fees which they have incurred since the entry of the default judgment under 42 U.S.C. § 3613(c)(2). For the reasons set forth below, the plaintiffs' motion for attorney's fees is granted in part and denied in part.

         Background

         Judge Darrah granted default judgment in this action on December 12, 2016, after the Condo Association repeatedly failed to timely file their responsive pleadings. As part of that judgment, Judge Darrah awarded the plaintiffs their attorney's fees and costs in the amount of $71, 349.25 for the period ending November 22, 2016. The Condo Association moved to vacate the default judgment and, in the middle of the briefing of that motion, substituted counsel and filed an amended motion to vacate the default judgment. This case was reassigned to this Court while briefing of the Condo Association's amended motion to vacate the default judgment was underway. Following this Court's ruling denying that motion, the Condo Association moved for reconsideration, which was denied. The plaintiffs have brought this motion to recover the fees that they incurred between November 23, 2016, and December 19, 2017, while litigating the Condo Association's attempts to vacate Judge Darrah's decision.

         Legal Standard

         In civil actions under the Fair Housing Act, the court, “in its discretion, may allow the prevailing party, other than the United States, a reasonable attorney's fee and costs.” 42 U.S.C. § 3613(c)(2). The principal factor in determining what constitutes a reasonable fee is the “lodestar” figure, which is the number of hours spent by the attorney(s) multiplied by their reasonable hourly rate. Pickett v. Sheridan Health Care Ctr., 664 F.3d 632, 639 (7th Cir. 2011) (quoting Hensley v. Eckerhart, 461 U.S. 424, 443, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983)). An award of the originally calculated lodestar amount is presumptively reasonable, and it is the opposing party's burden to show that an adjusted rate is needed. Robinson v. City of Harvey, 489 F.3d 864, 872 (7th Cir. 2007). If an adjusted rate is needed, the court may increase or decrease the lodestar based on considerations such as the degree of success or the results obtained from litigation. Thorncreek Apts. III, LLC v. Mick, 886 F.3d 626, 638 (7th Cir. 2018).

         Discussion

         As an initial matter, the plaintiffs contend that the Condo Association's response should be disregarded as a result of the Condo Association's failure to comply with the Local Rules. Local Rule 54.3(e)(2) requires that the party responding to a fee motion provide a table giving the respondent's position as to the name, compensable hours, appropriate rates, and totals for each biller listed by the movant. It is undisputed that the Condo Association failed to comply with this rule's mandate. Despite this failure to comply with the clearly established rules of this Court, the Condo Association's arguments will nevertheless be considered to the extent that they are set forth in the briefing before the Court. See Sonii v. Gen. Elec., No. 95 C 5370, 2003 WL 21541039, at *3 (N.D. Ill. June 11, 2003) (Gottschall, J.) (recognizing that courts have discretion to consider a respondent's arguments despite that party's noncompliance with Local Rule 54.3(e)).

         In order to be entitled to attorney's fees, the plaintiffs must first establish that they were the prevailing parties in this action. The Condo Association contends that the plaintiffs are not the prevailing party because a default judgment is not a victory on the merits. The fee-shifting provisions of the FHA found in section 3613(c)(2) provides that attorney's fees are only available to a party that has secured a judgment on the merits or a court-ordered consent decree. Claiborne v. Wisdom, 414 F.3d 715, 719 (7th Cir. 2005); (citing Buckhannon Bd. & Care Home, Inc. v. W.Va. Dep't of Health & Human Res., 532 U.S. 598, 603-04, 121 S.Ct. 1835, 149 L.Ed.2d 855 (2001)). A judgment on the merits is one that results in a material alteration of the legal relationship of the parties and results from a judicial act rather than a party's voluntary change in conduct. Buckhannon, 532 U.S. at 604-605.

         The Condo Association's illusory arguments notwithstanding, it is clear that a default judgment is a judgment on the merits. A default judgment, when entered, establishes the non-moving parties' legal liability as to each cause of action alleged in the complaint and establishes, as a factual matter, the truth of every allegation in the complaint relating to liability. Scott v. Peterson, No. 09 C 1633, 2010 WL 3173001, at *2 (N.D. Ill. Aug. 11, 2010) (Kendall, J.)(citing Breuer Elec. Mfg. Co. v. Toronado Sys. of Am., Inc., 687 F.2d 182, 186 (7th Cir.1982)). Default judgments therefore materially alter the parties' legal relationship and plainly constitute judgments on the merits. Although the Condo Association may have failed to defend this action, the default judgment in the plaintiffs' favor here is a judgment on the merits issued in the plaintiffs' favor within the meaning of section 3613.

         In order to calculate a lodestar value, it is first necessary to identify the billing attorneys' reasonable hourly rate. The reasonable hourly rate used in calculating the lodestar must be based on the market rate for the attorney's work. McNabola v. Chi. Transit Auth., 10 F.3d 501, 519 (7th Cir. 1993). The market rate is considered to be the rate that lawyers of similar experience and ability in the community would normally charge their paying clients for the type of work in question. Id. It is the movant's initial burden to establish that the hourly rates that they seek represent the market rate for their work. Once that burden is met, it becomes the opposing party's burden to demonstrate why a lower rate should be awarded. Uphoff v. Elegant Bath, Ltd., 176 F.3d 399, 407 (7th Cir. 1999).

         Here, John Durso billed between $692.95 and $695.00 per hour, Jamie Robinson billed $555.00 per hour, Peter Shakro billed $313.78 per hour, and Patrick Duffey billed $325.00 per hour. These rates are established by affidavit to be the rates customarily charged to Nixon Peabody's clients and to be representative of those charged in the legal community for similar services. Although limited, this evidence is sufficient to establish the involved attorneys' reasonable hourly rates because the best evidence of an attorney's market rate is what they actually bills for similar work. Montanez v. Simon, 755 F.3d 547, 554 (7th Cir. 2014). The Condo Association, by contrast, offers no viable evidence calling this rate into question. The only evidence offered is defense counsel's unsubstantiated assertion in the response brief that she charges $325.00 per hour and that the plaintiffs' rates therefore do not represent the going rate in the community. Even if offered as evidence, one attorney's hourly rate would be wholly inadequate to establish that another attorney's hourly rate is unreasonable, especially when, as here, there is no evidence concerning the involved attorneys' respective skill, experience, or reputation. The Condo Association has accordingly failed to meet its burden of establishing that plaintiffs' counsel's hourly rates are unreasonable.

         Having determined that counsels' hourly rates are reasonable, this Court turns to the reasonableness of the hours that the plaintiffs claim were expended on this case. Here, the plaintiffs seek to recover for 28.3 hours billed by John Durso, 45.2 hours billed by Jamie Robinson, 35.3 hours billed by Peter Shakro, and 38.4 hours billed by Patrick Duffey. The Condo Association contends that the plaintiffs have improperly engaged in cluster billing and have overbilled for their services.

         Cluster billing is the practice of describing multiple separately billable activities within one billing entry, such that it is impossible to discern how much time each individual task may have taken. When a fee petition is vague or inadequately documented, a court may strike problematic entries or reduce the fee awarded. Harper v. City of Chi. Heights, 223 F.3d 593, 605 (7th Cir. 2000). The Court agrees that cluster-billing makes it more difficult for a reviewing court to assess the reasonableness of specific tasks, especially when a clustered billing entry includes conduct for which attorney's fees are not warranted. After close review of the specific entries identified by the Condo Association, however, this Court concludes that they are in fact reasonable in light of the tasks identified and the time consumed. The Condo Association, although it claims that cluster billing is a ...


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