Tag Archives: Costs

S.D.Fla.: Defendants Did Not Moot FLSA Case By Tender of Unpaid Wages and Liquidated Damages Without Attorneys Fees and Costs

Diaz v. Jaguar Restaurant Group,  LLC

In the first post-Dionne II case, a court in the Southern District has denied an FLSA defendants’ motion to dismiss based on tender of unpaid wages and liquidated damages, absent payment of attorneys fees and costs.  The bizarre procedural history involved the defendants “tender” of wages and liquidated damages, only after prevailing at trial, and reversal at the Eleventh Circuit due to the trial court’s order permitting the defendants to amend their answer to assert a previously unpled exemption during the trial.

The Order reads in part:

“To a great extent, the pending motion to dismiss has now been rendered moot by the Eleventh Circuit’s substitute opinion entered in the case of Dionne v. Floormasters Enterprises, Inc., No. 09-15405 (11th Cir. Jan. 13, 2012), which clarified that the Court’s opinion in that case is limited to its very narrow facts and, specifically, requires a concession of mootness and does not apply to the tender of full payment of amounts claimed by the employee in a FLSA case before trial or after judgment. The pending motion is based entirely upon a proposed extension of the Court’s now-withdrawn original opinion. Moreover, other cases that considered the issues raised here rejected attempts to expand the scope of the original opinion. See, e.g., Tapia v. Florida Cleanex, Inc., No. 09-21569 (S.D. Fla. Oct. 12, 2011) (Ungaro, J., D.E. 67, collecting cases). Judge Ungaro’s opinion has now been sustained by the Eleventh Circuit on rehearing. And, even under the original panel opinion, the Court could not possibly find that Defendant’s unilateral actions taken after a trial and an appeal rendered Plaintiff’s claim for damages and attorneys’ fees moot. But, in any event, the entire issue is now moot for purposes of this case.”

Click Diaz v Jaguar Restaurant Group, LLC to read the entire Order (contained in the Docket Sheet for the case at Docket Entry 108).

Thanks to Rex Burch for the head’s up on this Order.

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11th Cir.: Following Tender of Unpaid Wages and Liquidated Damages, an Employer Only Moots a Case if the Plaintiff Agrees to Dismissal, Absent Payment of Mandatory Fees and Costs

Dionne v. Floormasters Enterprises, Inc.

Following a controversial opinion that created more questions than it answered, the Eleventh Circuit reconsidered it’s prior Opinion in this case and in so doing largely restricted its holding to the unique facts presented in the case.  Previously the Court had held that  an employer, who denies liability for nonpayment for overtime work, need not pay attorney’s fees and costs pursuant to 29 U.S.C. § 216(b) of the Fair Labor Standards Act (“FLSA”) if the employer tenders the full amount of overtime pay claimed by an employee, and moves to dismiss on mootness grounds where the employee concedes that “the claim for overtime should be dismissed as moot.  Although the prior Opinion seemed restricted to these unique facts where the employee conceded that the overtime claim should be dismissed (but attempted to reserve as to fees/costs), courts throughout the Eleventh have since expanded the holding to scenarios where the employee makes no such stipulation.  Here, the Eleventh Circuit affirmed the prior decision, but clarified and limited its applicability.

Significantly, the Eleventh Circuit included the following footnote in its new Opinion:

“Our decision in this matter addresses a very narrow question: whether an employee who conceded that his claim should be dismissed before trial as moot, when the full amount of back pay was tendered, was a prevailing party entitled to statutory attorney’s fees under § 216(b). It should not be construed as authorizing the denial of attorney’s fees, requested by an employee, solely because an employer tendered the full amount of back pay owing to an employee, prior to the time a jury has returned its verdict, or the trial court has entered judgment on the merits of the claim.”

It remains to be seen exactly how the new Dionne Opinion will be applied by trial courts, but it does appear that much of the uncertainty created by the initial Opinion has now been resolved.  To that end, it appears that a Plaintiff who has suffered a theft of his or her wages can now safely accept tender of such wages (and liquidated damages) in response to a lawsuit to collect same, without fear that the employer can avoid payment of mandatory fees and costs, as long as they do not agree that the tender moots the case.

Click Dionne v. Floormasters Enterprises, Inc. to read the entire Opinion on Petition for Rehearing.

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S.D.Tex.: Defendant Who Prevailed at Trial Following OJ, Not Entitled to Award of Attorney’s Fees Under FLSA

Tran v. Thai

While not a novel concept, this case demonstrates a commonly misunderstood concept in FLSA jurisprudence, an FLSA defendant who prevails at trial, following the tender of an offer of judgment (OJ), is not entitled to an award of its attorneys fees.

In this case the defendant had served an OJ on the plaintiff in the amount of $500.00, which the plaintiff did not accept.  The case then proceeded to trial and resulted in a defense verdict.  Following the defense verdict, the defendant moved for an award of its fees and costs, citing Rule 68, the OJ statute.  Denying the defendant’s motion, the court explained that OJ’s do not shift attorney’s fees in FLSA cases, because: (1) OJ’s only shift fees where a plaintiff prevails at trial, but for less than the amount of the OJ; and (2) the FLSA does not permit fee shifting to a defendant.

Reasoning that an award of the defendant’s attorney’s fees was impermissible here, the court explained:

“There are two flaws in the defendants’ request for the fees they incurred after the plaintiff failed to accept the $500 offer. First, Rule 68 “applies only to offers made by the defendant and only to judgments obtained by the plaintiff. It therefore is simply inapplicable to this case because it was the defendant that obtained the judgment.” Delta Air Lines, Inc. v. August, 450 U.S. 346, 352, 101 S.Ct. 1146, 67 L.Ed.2d 287 (1981); MRO Communications, Inc. v. American Tel. & Tel. Co., 197 F.3d 1276, 1280 (9th Cir.1999); see also CHARLES ALAN WRIGHT, et al., 12 FED. PRAC. & PROC. CIV. § 3006 (2d ed.) (“[Rule 68] is entirely inapplicable … if the defendant, rather than the plaintiff, obtain judgment.”). In Delta Airlines, Justice Powell, concurring in the result noted that the Court’s holding implies that “a defendant may obtain costs under Rule 68 against a plaintiff who prevails in part but not against a plaintiff who loses entirely.” 450 U.S. at 362 (Powell, J., concurring) (emphasis in original). In other words, if the jury in this case had awarded Nguyen $300 against the defendants, they could seek attorney fees under Rule 68(d). But because the jury awarded nothing, and judgment is entered in favor of the defendants, there is no basis to award attorney’s fees. See Farley v. Country Coach, Inc., No. 05-71623, 2008 WL 795788, at *1 (E.D.Mich. Mar.26, 2008); Drewery v. Mervyns Dept. Store, No. C 07-5017 RJB, 2008 WL 222627, at *1-2 (W.D.Wash. Jan.25, 2008).

In support of their argument that Rule 68 is relevant to an award of costs in this case, the defendants have cited Haworth v. Nevada, 56 F.3d 1048 (9th Cir.1995). In that case, however, the plaintiffs prevailed on one of their claims. The Ninth Circuit held that the defendant was entitled to costs under Rule 68 because the defendant’s offer of judgment exceeded the final judgment obtained by the plaintiffs. Id. at 1052. In this case, the defendants prevailed and the plaintiff lost entirely. Rule 68 is not applicable.

The second flaw is that the FLSA does not appear to be in the category of statutes on which Rule 68 operates to include fees. The Supreme Court considered the applicability of Rule 68 to statutory fee-shifting provisions in Marek v. Chesny, 473 U.S. 1, 105 S.Ct. 3012, 87 L.Ed.2d 1 (1985). The Court upheld the application of Rule 68 to the fee-shifting provision of 42 U.S.C. § 1983. The Court reasoned that in an action under § 1983, “all costs properly awardable in an action are to be considered within the scope of Rule 68 ‘costs.’ Thus, absent congressional expressions to the contrary, where the underlying statute defines ‘costs’ to include attorney’s fees, we are satisfied such fees are to be included as costs for purposes of Rule 68.”   Id. at 9, 105 S.Ct. at 3016. Because § 1983 defined costs to include attorney’s fees, Rule 68 applied to bar recovery for any attorney’s fees incurred after a Rule 68 offer was made when the plaintiff recovered less by judgment than the settlement offer. Id. The FLSA is different. The FLSA defines attorney’s fees separately from costs. 29 U.S.C. § 216(b). Unlike attorney’s fees in a § 1983 action, attorney’s fees in an FLSA action are not automatically shifted by Rule 68. Accord Fegley v. Higgins, 19 F.3d 1126, 1135 (6th Cir.1994), cert. denied, 513 U.S. 875, 115 S.Ct. 203, 130 L.Ed.2d 134 (1994); Cox v. Brookshire Grocery Co., 919 F.2d 354, 358 (5th Cir.1990) (dicta); Haworth v. State of Nev., 56 F.3d 1048, 1051 (9th Cir.1995).

The motion for judgment is denied to the extent it seeks to include $22,057.90 in attorney’s fees after the offer of judgment.”

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W.D.Mich.: FLSA Permits Successful Plaintiff To Recover Costs Which Are ‘Normally Charged To A Fee-paying Client’ In Addition To Those Enumerated In § 1920

Carlson v. Leprino Foods Co.

This case was before the Court on both parties’ objections to the Report and Recommendation (R&R) issued by the Magistrate Judge regarding an award of fees and costs following the settlement of a collective action.  Of note, the Plaintiffs objected to the R&R issued by the Magistrate Judge, because the Magistrate cut over $2,000 in miscellaneous costs Plaintiffs  requested.  The Court extensively discussed the award of the attorneys fees to the prevailing Plaintiffs and, as discussed here, reinstated the miscellaneous costs, opining that a prevailing Plaintiff in an FLSA case is entitled to recover those types of costs ‘normally charged to a fee-paying client,’ in addition to those enumerated in § 1920.

Specifically, discussing the award of costs, the Court reasoned:

“Finally, Plaintiffs object that the Magistrate Judge should not have deducted $2,343.45 in miscellaneous expenses from the total award of costs. (Pls.’ Objections to Report and Recommendation of Magistrate Judge, docket # 221, at 8.) The Court agrees. The Report and Recommendation states that Plaintiffs failed to describe these miscellaneous expenses with particularity and that the expenses therefore are not recoverable. (Report and Recommendation, docket # 219, at 12.) However, Plaintiffs described the expenses with particularity in Exhibit 2 of their original fee petition. (Br. in Support of Mot. for Attorneys’ Fees and Costs, docket # 196, Ex. 2.) The miscellaneous expenses identified include, without limitation, costs for travel, supplies, web maintenance, translations, and telephone service. (Id.) These are the sort of costs which are “normally charged to a fee-paying client.” See, e.g., Renfro v. Indiana Mich. Power Co., 2007 WL 710138 at *1 (W.D.Mich., Mar.6, 2007) (overruled on other grounds, 497 F.3d 573 (6th Cir.2007) (citations omitted)); Communities for Equity v. Mich. High School Athletic Ass’n, 2008 WL 906031 at *22-23 (W.D.Mich., Mar.31, 2008). The total award for costs to Plaintiffs should include the $2,343.45 for miscellaneous expenses.”

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N.D.Ill.: Offer Of Judgment, Silent On Its Face As To Attorneys Fees And Costs, Read To Allow For Attorneys Fees And Costs

Garcia v. Oasis Legal Finance Operating Co.

Plaintiff filed a one-count Complaint against Defendant in which she asserted violations of the Equal Pay Act, 29 U.S.C, § 206 et seq., and requested, inter alia, the following relief; an Order awarding her the difference between wages paid to her and those paid to similarly situated male employees, liquidated damages, and statutory attorneys’ fees and costs. Defendant answered the Complaint, denying the material allegations. This Motion concerned Plaintiff’s acceptance of Defendant’s Offer of Judgment, as more fully detailed below.

On November 20, 2008, Defendant’s attorney mailed a Rule 68 Offer of Judgment to Garcia’s counsel. Defendant’s attorney also faxed a copy of this Offer to Plaintiff’s counsel on that same date. This Offer read in its entirety:

As you know our firm represents Oasis Legal Finance, LLC, and Oasis Legal Finance Operating, LLC in reference to the above captioned matter. This letter is being written to you pursuant to F .R.C.P. 68, “Offer of Judgment”. Please be advised that pursuant to F.R.C.P. 68 the defendants offer judgment to the plaintiff, Karina Garcia, in the sum of $3,850.00. Pursuant to F.R.C.P. 68, your client has ten (10) days to accept the offer in judgment as set forth herein. If you have any questions, please contact me. Thank you,

On December 8, 2008, Plaintiff’s attorney submitted a letter to Oasis’ counsel accepting the Offer. This letter read in its entirety:

This letter is in response to Defendant’s offer of judgment which was served via U.S. mail on November 20, 2008. Your letter provided only that “defendants offer judgment to the plaintiff, Karina Garcia, in the sum of $3,850.00″ in connection with Ms. Garcia’s cause of action under the Equal Pay Act in the above referenced federal case. Because the offer of judgment is for an amount in excess of the value of Plaintiff’s Equal Pay Act claim, Plaintiff hereby accepts the offer of judgment as stated for her currently pending federal action. Since Defendant’s offer made no reference to costs or attorney’s fees, Plaintiff will proceed with a petition for fees and costs as to this cause of action upon entry of the judgment. Plaintiff’s claims under Title VII and the Illinois Human Rights Act remain under investigation at the EEOC/IDHR and cannot be resolved through the offer of judgment. If you wish to discuss those claims as the investigation moves forward, please feel free to call me.

Defndant then filed a Motion to Strike Plaintiff’s Purported Acceptance of Offer of Judgment, asserting Plaintiff’s purported acceptance was not in fact an acceptance, but was rather a rejection and a counter-offer, which is impermissible under Rule 68, Plaintiff cross-motioned for judgment in her favor. On January 26, 2009, the Court granted Plaintiff’s Motion, denied Defendant’s Motion, and directed the Clerk to enter judgment for Plaintiff. The Clerk entered judgment on January 27, 2009. The Court, in its January 26, 2009 Opinion and Order, granted Plaintiff leave to file a motion for attorneys’ fees if it was appropriate to do so. Plaintiff filed her Motion for Attorneys’ Fees on February 17, 2009.

The Court discussed, at length, the issue of whether Defendant’s Offer of Judgment, as made, was inclusive or exclusive of attorneys fees:

“Oasis correctly asserts that its Rule 68 Offer covered the sole Count of Garcia’s complaint, and that Garcia’s claim sought attorneys’ fees as part of the requested relief. The Court must therefore first determine, as a threshold matter, whether Garcia’s acceptance of Oasis’ Offer of Judgment precludes her from seeking a further award of attorneys’ fees.

Oasis contends that Nordby controls. In that case, defendants made a Rule 68 Offer of Judgment “in the amount of $56,003.00 plus $1,000 in costs as one total sum as to all counts of the amended complaint.” Nordby, 199 F.3d at 391. Plaintiff accepted the Offer, and moved the district court for a statutory award of attorneys’ fees. Id. The court denied the motion, reasoning that the Offer as accepted included fees. Id. On the specific set of facts before it, the Seventh Circuit affirmed, finding that the Offer unambiguously included fees. ” ‘One total sum as to all counts of the amended complaint’ can only mean one amount encompassing all the relief sought in the counts. One of those counts specified attorneys’ fees as part of the relief sought. That relief was covered by the offer.” Id. at 392.

Garcia, on the other hand, asserts that Oasis’ Offer of Judgment is more like the one made by defendants in Webb. In that case, defendants’ Offer read in its entirety; “The Defendants, Dick James and Dick James Ford, Inc., by their attorneys, Steven C. Wolf and Victoria A. Barnes, hereby make an offer of judgment in the above-captioned matter in the amount of Fifty Thousand Dollars ($50,000.00) pursuant to Federal Rule of Civil Procedure 68.” Webb, 147 F.3d at 619. The district court granted plaintiff’s separate motion for fees, and the Seventh Circuit affirmed. The Seventh Circuit first noted that, “[o]n its face, the offer did not address costs or fees,” id., and later observed that it would have been a simple matter for defendants to “have drafted the offer to signal Webb that it was inclusive of attorney’s fees.” Id. at 623, Because a Rule 68 Offer puts plaintiffs at risk whether or not they accept it, the Seventh Circuit reasoned, “the defendant must make clear whether the offer is inclusive of fees when the underlying statute provides fees for the prevailing party … [T]he plaintiff should not be left in the position of guessing what a court will later hold the offer means.” Id. The Seventh Circuit found that the defendants should therefore “bear the burden of the ambiguity created by their silence on fees,” and held that the district court could “award an additional amount to cover costs and fees.” Id.

In this case, although it is a close call, the Court determines that the Offer of Judgment made by Oasis is more like the one in Webb than the one in Nordby. Here, the Offer of Judgment states in part, “Please be advised that pursuant to F.R.C.P. 68 the defendants offer judgment to the plaintiff, Karina Garcia, in the sum of $3,850.00.” The Offer is silent as to attorneys’ fees and costs, and does not include, like the Offer in Nordby, language to the effect that the Offer is “one total sum” as to the entirety of Garcia’s requested relief Moreover, there is no question that it would have been a simple matter for Oasis to clearly indicate in its Offer whether fees were included. A standard Rule 68 Offer of Judgment form published by Bender’s Federal Practice includes specific language defendants can use to indicate that costs and fees are included in an Offer of Judgment. 11-68 Bender’s Federal Practice Forms No. 68:3; see also 11-68 Bender’s Federal practice Forms, Comment on Rule 68, ¶ 6 (“it is well established that when an offer is silent about whether the sum specified includes costs and attorney’s fees, the silence means that the court will add costs and attorney’s fees to the amount stated. An argument that the lump sum was meant to include all costs and attorney’s fees will be unavailing.”). Because Oasis failed to take the simple step of indicating whether the Offer included fees and costs, Oasis must “bear the burden of [its] ambiguity created by [its] silence on fees.” See Webb, 147 F.3d at 619. The Court therefore determines that Garcia’s acceptance of Oasis’ Offer of Judgment does not preclude her from pursuing an award of fees and costs.”

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