Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_05-cv-03406/USCOURTS-cand-3_05-cv-03406-16/pdf.json

Nature of Suit Code: 120
Nature of Suit: Marine Contract Actions
Cause of Action: 28:1331 Fed. Question

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United States District Court

For the Northern District of California

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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

ARMADA BULK CARRIERS, a Foreign

Corporation,

Plaintiff,

v.

CONOCOPHILLIPS COMPANY, INC., a

Delaware Corporation, FOSS MARITIME

COMPANY, INC., a Washington

Corporation, and FOSS MARITIME

BARGE 185 P3, in rem,

Defendants. 

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No. C-05-3406 SC

ORDER GRANTING

DEFENDANT'S MOTION

FOR FEES AND COSTS

I. INTRODUCTION

On May 7-11 and 21-22, 2007, a bench trial was held before

this Court. On June 22, 2007, the Court entered its Findings of

Fact and Conclusions of Law in favor of Defendant ConocoPhillips

Company, Inc. ("Defendant" or "CP") and against Plaintiff Armada

Bulk Carriers ("Plaintiff" or "Armada"). Docket No. 152. The

Court found that CP was entitled to $189,906.73, the full amount

of its cross-claim, plus prejudgment interest, fees, and expenses

as provided under the parties' contract. Id. Subsequently, CP

submitted its Bill of Costs and Motion for Attorney's Fees and

Expenses; Armada filed an Opposition Brief; and CP filed a Reply

Brief. Docket Nos. 153-54, 156, 158. 

Case 3:05-cv-03406-SC Document 159 Filed 08/27/07 Page 1 of 5
United States District Court

For the Northern District of California

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Having reviewed the relevant documentation and case law, the

Court hereby GRANTS CP's Motion for Attorney's Fees and Costs and

AWARDS CP $374,593.45, which includes $308,595.00 in attorney's

fees, $8,396.70 in costs, $26,615.29 in expert witness fees and

expenses, and $30,986.46 in prejudgment interest through and

including the date payment was received.

II. DISCUSSION

CP is entitled to the amounts requested based on the contract

of sale and relevant case law. The parties' binding contract

states that the prevailing party shall recover all costs and

expenses incurred in the exercise of any remedies under the

contract. See ConocoPhillips Products Purchase/Sale Agreement

General Terms and Conditions ("GT&C"), Trial Ex. 131, ¶ 10.3. In

addition, CP is entitled to prejudgment interest on the amount due

for the oil delivered to Armada. See id. at ¶ 4.3.

The contract specifies that it is governed by New York law. 

See id. at ¶ 11.1. Courts sitting in admiralty will give effect

to the parties' commercial agreements and the choice of law

provisions contained therein. See Norfolk S. Ry. Co. v. Kirby,

543 U.S. 14, 31-32 (2004); Chan v. Soc'y Expeditions, Inc., 123

F.3d 1287, 1296-97 (9th Cir. 1997). In analyzing attorney's fees,

courts must determine whether they are reasonable:

The rule in New York is that when a contract provides that in

the event of litigation the losing party will pay the

Case 3:05-cv-03406-SC Document 159 Filed 08/27/07 Page 2 of 5
United States District Court

For the Northern District of California

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attorneys' fees of the prevailing party, the court will order

the losing party to pay whatever amounts have been expended

by the prevailing party, so long as those amounts are not

unreasonable.

Diamond D. Enter. USA, Inc. v. Steinsvaag, 979 F.2d 14, 19 (2d

Cir. 1992) (internal quotations omitted). In this case, the

contract provision for reimbursement of the prevailing party's

costs and expenses is broad, specifying that "all costs and

expenses (including reasonable attorney fees)" shall be

recoverable. GT&C, ¶ 10.3. In a decision involving similar

contract language, the court awarded all reasonable fees,

including those for experts assisting the attorneys. See

Morse/Diesel, Inc. v. Trinity Indus., Inc., 875 F. Supp. 165, 179

(S.D.N.Y. 1994), rev'd on other grounds, 67 F.3d 435 (2d Cir.

1995). Though it reversed the decision, the Second Circuit did

not overturn the District Court's fee interpretation. See id.

The Court finds that the broad contract provision covering costs

and expenses allows for recovery of all the items requested by CP,

including expert witness fees and expenses. Having determined

that CP may recover fees and expenses, the Court will analyze

which of those items are reasonable and recoverable.

CP seeks to recover for attorney's fees, court costs, expert

fees, and prejudgment interest. First, under New York law, a

court faced with a request for attorney's fees must make its own

determination as to whether the request is justified by the time

and labor expended. See F.H. Krear & Co. v. Nineteen Named Trs.,

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810 F.2d 1250, 1265 (2d Cir. 1987). Furthermore, 

A variety of factors informs the court's determination of

whether a requested amount of attorneys' fees is reasonable

or unreasonable, including the difficulty of the questions

involved; the skill required to handle the problem; the time

and labor required; the lawyer's experience, ability and

reputation; the customary fee charged by the Bar for similar

services; and the amount involved.

Id. at 1263. In light of all the relevant factors, the Court

finds that the fees requested by CP are reasonable. This case

involved complex factual issues surrounding the proper methods of

loading and testing marine fuel oil as well as analysis of the

chemical and physical properties of the fuel. It required a

significant amount of skill, time, and labor from discovery

through trial. Defendant's counsel, Mr. Erb, had the requisite

experience, ability, and reputation to secure the job as CP's

attorney and win the case at trial. Mr. Erb's rates are at the

customary rate for attorneys of his caliber and the total fees

involved are reasonable in light of the work required. However,

Defendant may not recover for those fees incurred in seeking to

recover fees from Plaintiff. Under New York law, "a general

contract provision for the shifting of attorneys' fees does not

authorize an award of fees for time spent in seeking the fees

themselves." Id. at 1266. Having parsed the billing statements

attached to Mr. Erb's Declaration, the Court will deduct

$15,083.75 from the total amount of Mr. Erb's fees that are

recoverable from Armada.

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United States District Court

For the Northern District of California

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The Court also finds that the expert witness fees and

expenses incurred by CP were reasonable. Though Armada contends

that its expert charged a slightly lower rate and stayed at a more

affordable hotel, that does not make CP's expert fees and expenses

unreasonable. Thus, CP will recover the full amount requested. 

CP is also entitled to the full amount of prejudgment interest

through the date of judgment under ¶ 4.3 of the GT&C, a document

comprising one part of the parties' binding contract. Thus, CP

will recover the full amount of prejudgment interest requested. 

Finally, CP is entitled to the requested court costs as indicated

on the Bill of Costs.

 

III. CONCLUSION

For the reasons discussed herein, the Court GRANTS

Defendant's Motion for Fees and Costs. The Court AWARDS Defendant 

$308,595.00 in attorney's fees, $8,396.70 in costs, $26,615.29 in

expert witness fees and expenses, and $30,986.46 in prejudgment

interest for a total of $374,593.45.

IT IS SO ORDERED.

Dated: August 27, 2007.

 

UNITED STATES DISTRICT JUDGE

Case 3:05-cv-03406-SC Document 159 Filed 08/27/07 Page 5 of 5