SUPERIOR COURT OF THE STATE OF DELAWARE P AUL R. W ALLACE J UDGE N EW C ASTLE C OUNTY C OURTHOUSE 500 N. K ING S TREET , S UITE 10400 W ILMINGTON , D ELAWARE 19801 (302) 255

- 0660

Date Submitted: February 24, 2021 Date Decided: March 24 , 2021

Stephen B. Brauerman, Esquire Elizabeth A. Powers, Esquire 600 North King Street, Suite 400 Wilmington, Delaware 19801 Robert Mahoney , Esquire Saleem Mawji , Esquire Norris Mclaughlin, P.A. 400 Crossing Boulevard, 8th Floor Bridgewater, New Jersey 08 807 Kelly A. Green, Esquire Smith, Katzenstein & Jenkins LLP 1000 West Street, Suite 1501 Wilmington, Delaware 19801 Jeffrey Gans, Esquire Pillsbury Winthrop Shaw Pittman LLP 1200 Seventeenth Street NW Washington, DC 20036

RE: Facchina Construction Litigations Civil Action No. N17C

- 09

- 163 PRW CCLD (Consolidated) Dear Counsel:
This Letter Order addresses the Plaintiff Mr. Facchina ’s and Defendant s ICATech and Empresas’ (together “ICATech”) Cross

- Motions for Costs and Fees (D.I. 188, 191, respectively). The parties now ask the Court to determine whether they may recover their attorney’s fees, costs, and expenses resulting from this litigation. For the reasons set forth briefly below, both Motions are DENIED.Facchina Construction Litigations

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I. FACTUAL AND PROCEDURAL BACKGROUND
T he Court now considers cross
- motions for costs and fees stemming from a lengthy, three

- year litigation , involving Mr. Facchina ( as “ Seller Representative ” ),
ICATech Corporation and its parent Empresas ICA, S.A.B. De C.V. (“ICATech”) , and Facchina Construction Company, Inc. (“FCCI”). The parties became entangled in June of 2013, when ICATech bought FCCI by the executed Purchase and Sale Agreement (“PSA”). 1 Mr. Fac china was designated as the “Seller Representative” for FCCI (“Sellers”) and Empresas ICA was a party to the PSA as a guarantor for ICATech

. 2 In September 2017, Mr. Facchina filed suit against ICATech and Empresas, seeking both an Acceleration Payment of $30,647,509 and recovery of $3.5 million held in escrow ( the “ Escrow ed Funds”)

. 3 A month later, FCCI brought suit against Mr. Facchina seeking a money judgment in the Adjusted Principal Amount of $6,814,303.08 plus costs, pre

- and post

- judgment interest, and attorney ’ s fees arising from Seller’s indemnification obligations under the PSA

. 4 FCCI also sought attorney’s fees under

1 Facchina Construction Litigation s , 2020 WL 6363678, at *1 (Del. Super. Ct. Oct. 29, 2020).

2 Id.

3 Id.

4 Id . at *2

.Facchina Construction Litigations

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- 163 PRW CCLD March 24, 2021 Page 3 of 11
PSA Section 11.23, and declaratory judgment that Mr. Facchina was not entitled to
the Escrowed Funds. 5
T he parties presented their cases during a five

- day trial to the Court sitting without a jury

. 6 There were three central contentions to be resolved by trial: (1) whether there was fraud in the form of concealment of risks concerning the Grove at Grand Bay condominium project in Miami; (2) whether indemnification was required under the t erms of the PSA, including entitlement to $3.5 million held in escrow; and (3) whether acceleration of an earn

- out payment was due under the
terms of the PSA. 7 In October 2020, th e Court issued its Decision After Trial, entering a verdict where each part y succeeded on some issues and lost on others. 8 A Final Order and Judgment was filed a month later , on November 24, 2020. 9
The parties were permitted to brief entitlement and quantum of an award for any fees

5 Id

.
6 Seller Representative’s Opening Br. in Supp. of Mot. for an Award of Att’y’s Fees and Expenses at 3, December 21, 2020 (D.I. 188) (hereinafter “Seller Rep. Opening Br.”).

7 Facchina Construction Litigation s , 2020 WL 6363678 , at *2

.
8 Id . at *20 (“On FCCI’s Complaint, this Court found for Mr. Facchina; On Mr. Facchina’s Complaint, this Court found for ICATech and on ICATech’s Amended Answer and Counterclaim, this Court found for Mr. Facchina. ” ).

9 Final J. Order , Nov

. 24, 2020 (D.I. 1 83).Facchina Construction Litigations

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- 163 PRW CCLD March 24, 2021 Page 4 of 11
and costs. 10 B oth Mr. Facchina and ICATech then filed their Motions for an Award of Attorney’s Fees and Expenses. 11 In response, FCCI filed a written opposition to Mr. Facchina’s prayer for attorney ’s fees and expenses; Mr. Facchina filed a b rief

o pposin g ICATech’s motion

. 12
II. STANDARD OF REVIEW Under the “American Rule” and Delaware law, litigants are responsible for paying their own litigation costs, even the winners. 13 An exception to this general rule is found in contract litigation that involve fee

- shifting provision s
. 14 A f ee
shifting provision allow s the Court to award costs incurred during litigation to the

10 Id . at ¶ 11.

11 Seller Rep. Opening Br.; ICATech Corp. and Empresas’s Post Trial Opening Br. for Fees and Costs, December 21, 2020 (D.I. 191) (hereinafter “ICATech’s Opening Br.”).

12 FCCI’s Opp’n to Mr. Facchina’s Mot. for an Award of Attorney’s Fees, January 22, 2021 (D.I. 203) (hereinafter “FCCI’s Opp’n”); Seller Rep. Ans. Br. in Opp’n to ICATech Post Trial Mot. for an Award of Attorney’s Fees and Costs, January 25, 2021 (D.I. 205)(hereinafter “Seller Rep.’s Opp’ n to ICATech”).

13 Mahani v. Edix Media Group, Inc. , 935 A.2d 242, 245 (Del. 2007); see Sternberg v. Nanticoke Memorial Hosp., Inc. , 62 A.3d 1212, 1218 (Del. 2013) (“It has been long practice of American courts to enforce the so

- called ‘American Rule’

— which requires each party to pay his or her own legal costs, even the prevailing party.”); s ee also Mrs. Fields Brand, Inc. v. Interbake Foods LLC , 2018 WL 300454, at * 2 (Del. Ch. Jan

. 5, 2018) ( Noting the Court of Chancery has applied the “predominance in the litigation ” standard to prevailing

- party contract provisions; that “[t]o achieve predominance, a litigant should prevail on the case’s chief issue. ; and, that ther e are occasions where “no party may be regarded as having prevailed.”).

14 Mahani , 935 A.2d at 245.Facchina Construction Litigations

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- 163 PRW CCLD March 24, 2021 Page 5 of 11 prevailing party. 15 A f ee
- shifting provision must be a clear and unequivocal agreement triggered by a dispute over a part y’s failure to fulfill obligations under
the contract. 16 When the parties’ agreement governs an award of costs, the C ourt will look solely to that document to determine whether to award att orney’s fees to the prevailing party on either an all

- or
- nothing or a claim

- by

- claim basis. 17
In fee

- shifting cases, D elaware courts are also tasked with determining the
reasonableness of the fees sought using th e Delaware Lawyers’ Rules of
Professional Conduct Rule 1.5 f actors

. 18 The Court is not required to conduct a line

item review of the fees and the party seeking fees carries its burden to justify a challenged litigation decision by showing that “the services that were rendered

15 Id

.
16 SARN Energy LLC v. Tatra Defence Vehicle A.S. , 2019 WL 6525256, at *1 (Del. Super. Ct. Oct. 31, 2019)

.
17 Comrie v. Enterasys Networks, Inc. , 2004 WL 936505, at *1

- 2 (Del. Ch. Apr. 27, 2004) ; s ee also Knight v. Grinnage , 1997 WL 633299, at *3 (Del. Ch. Oct. 7, 1997) (“ Courts give great weight to contract clauses creating the right to payment of attorney’s fees in subsequent litigation as the contracting parties have the opportunity to negotiate for provisions within the contract that would require one party to pay the attorney’s fees of the other if they do not abide by the terms of the contract.”).

18 Mahani , 935 A.2d at 245 ; Del. Lawyers’ Rules of Prof’l Conduct R. 1.5.Facchina Construction Litigations

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- 163 PRW CCLD March 24, 2021 Page 6 of 11 [were] thought prudent and appropriate in the good faith professional judgment of competent counsel.” 19 The parties agree that the PSA addresses fee

- shifting at Section 11.20. This provision states, “provided, that if a party prevails in part, and loses in par t, in such Proceeding, the court . . . shall award a reimbursement of the fees, costs and expenses incurred by the parties on an equitable basis.” 20 Thus, the Court looks at the results of each claim, assesses each party’s success or failure thereon, and then compares each party’s overall predominance in the litigation by ascribing relative weight and

cost to each success and failure therein.
III. LEGAL ANALYSIS At bottom, the question is whether any of the parties here may recover any of

t heir attorney’s fees, costs, or expenses from another

. And s ince there was no clearly prevailing party in this litigation, the Court must determine whether some fee

shifting is appropriate on an equitable basis to comport with PSA Section 11.20. 21

19 Boeing Co. v. Spirit Aerosystems, Inc. , 2017 WL 6021423, *3 (Dec. 5, 2017) (citing Danenberg v. Fitracks, Inc. , 58 A.3d 991, 997 (Del. Ch. 2012) (“A Court’s determination of reasonableness of attorney’s fees ‘does not require that this Court examine individually each entry and disbursement’ or conduct an independent inquiry of the appropriateness of counsel’s fee for a particular filing of litigation tactic.”).

20 PSA § 11.20 (JX

- 27)

.
21 Th is Court is occasionally required to apply equitable principles when deciding certain matters

. In such cases, the Court has jurisdiction to award attorney’s fees even when no contract or statuteFacchina Construction Litigations

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- 163 PRW CCLD March 24, 2021 Page 7 of 11 Not surprisingly, e ach party to the litigation has a different take on what award on an “equitable basis” would mean here under Section 11.20

. First, Seller Represent ative says an award equitabl y bas ed compels that he
receive one
- third of his total fees and costs , and all of his expert fees from ICATech and FCCI, jointly and severally, because he prevailed on one of the three central issues in the litigation. 22 He claims an additional one

- third of his total fees and expenses from ICATech because the Court found that “ICATech failed to prove any
element of fraud.” 23 He also baldly asserts that even though ICATech prevailed in its defense to the Acceleration Payme nt, its fees and costs should be offset against Mr. Facchina’s fees and costs in pursuing that claim. 24 Conversely, ICATech asserts that equity requires Seller Representative to pay the entirety of ICATech and Empresas’s incurred fees and costs resulting from this

requires it. But h ere, exercise of that jurisdiction is required by the PSA

. Dover Historical Soc., Inc. v. City of Dover Planning Com’n , 902 A.2d 1084, 1090 (Del. 2006)

.
22 Seller Rep

. Opening Br . at 5 ( “Given that indemnification was one of the three central issues in this matter and because of the intertwinement of all of the issues, Mr. Facchina should be awarded one

- third of his total fees, costs, and expenses, including all of his expert expenses fro m FCCI and ICATech, jointly and severally.” ).

23 Id . at 7.

24 Id

.Facchina Construction Litigations

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- 163 PRW CCLD March 24, 2021 Page 8 of 11 “frivolous” litigation. 25 ICATech relies on Mahani v. Edix Media Group, Inc. 26 which, it argues , permits a trial court to award a litigant “the full amount of its attorneys ’ fees and other expenses” when “it would be inequitable to deny [the litigant’s] full amount of its attorneys’ fees and other expenses since” the opposing party was responsible for needlessly causing th ose expenditures

— even when the opposing party prevaile d in part. 27 Finally, FCCI argues it is equitable to require each party to bear its own attorney’s fees and expenses because there was no “prevailing party.”
FCCI is correct. In this litigation, after making the claim

- by

- claim examination required here there was no “prevailing party” and thus , shifting would not be equitable under the PSA. 28 Here, each party won on some claims and lost on others, however, overall, each party recovered far less th an he or it sought. For example, Mr. Facchina went after both the Escrow ed Funds

— $3.5 million

— and the Acceleration Payment

— about $30 million

— in his Complaint. 29 A fter trial,

25 ICATech Opening Br. at 2.

26 935 A.2d 242 (Del. 2007)

.
27 ICATech Opening Br. at 2 ; Mahani , 935 A.2d at 248

.
28 Facchina Construction Litigations , 2020 WL 6363678 at *20.

29 Comp l. , at 22 , Sept. 15, 2017 (D.I. 1).Facchina Construction Litigations

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- 163 PRW CCLD March 24, 2021 Page 9 of 11 however, Mr. Facchina recovered only the Escrow ed Funds and rec eived not one
cent of the Acceleration Payment. 30 Similarly, ICATech sought return of the $55 million it paid for the Facchina Companies and the Escrow ed Funds ( plus interest ) , but failed to recover any bit of that

. 31 W hile Mr. Facchina’s targeting of IC ATech
for the acceleration payment may have been unsuccessful, after a complete
examination of the record evidence , the Court can hardly label his claims “frivolous.” Moreover, it’s clear that no small portion of ICATech’s fees and costs were expended in full engagement of its own futile fraud counterattack

. In Great Hills Equity Partners IV v. SIG Growth Equity Fund 32 , the Court of Chancery analyzed an almost identical fee

- shifting provision 33 and explained : [The Parties] have filed numerous motions, endured with longanimity 10 days of trial, undergone both a liability and damages determination, and now seek fees. And yet the result is not a distinct victory for either side. Under such circumstances, I find that nothing is more equitable than to leav e the fees in repose. An award of fees may be seen as a penalty for the party from which the fees may be paid. I find that it would be

30 Facchina Construction Litigations , 2020 WL 6363678 at *18

- 19.

31 Id

. at *2 , 16

.
32 2020 WL 7861336 (Del. Ch. Dec. 31, 2020) (Glasscock, VC)

.
33 In Great Hills , the pertinent provision is as follows, “provided, that if a party to such litigation...prevails in part, and loses in part, the court...presiding over such litigation... shall award a reimbursement of the fees, costs, and expenses incurred by such party on an equita ble basis

. ” Id . at *3.Facchina Construction Litigations

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- 163 PRW CCLD March 24, 2021 Page 10 of 11 inequitable to impose such a penalty, given the efforts of counsel on both sides and the results achieved. 34
S ame here

. It’s been a long, tumultuous legal battle over a three

- year span that’s included layers of motions and a five

- day bench trial. Between Mr. Facchina and ICATech, there is no clear winner and the damages sought by each party far
exceeded t hose finally a warded

. In turn, it is most equitable to have each party bear responsibility for his or its own fees and costs. To be sure, the relevant factors in Rule 1.5 support the reasonableness of the parties’ reported fe es. Delaware Courts have recognized that “an arm’s

- length agreement, particularly with a sophisticated client . . . c an provide an initial ‘rough cut’ of a commercially reasonable fee.” 35 This case involved three complicated
issues of interpreting the PSA and lengthy litigation between multiple parties that

were represented by appropriately manned teams of attorneys. The affirmative, defensive, and counter strategies engaged by each were reasonable decisions made by able counsel

— not me rely blows struck or re buffed capriciously. This too speaks to the equity of leaving each of the parties to bear the costs incurred to obtain his or
its mixed

— and mostly disappointing

— result s
.

34 Id. at *6

- 7.

35 Danenberg v. Fitracks, Inc. , 58 A.3d at 997.Facchina Construction Litigations

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I V . CONCLUSION
I n the Court’s view, it is most equitable that each party be ar his or its own attorney’s fees, costs, and expenses incurred during this litigation. No party here
can be said to hav e prevailed ; the relative wins and losses in each’s column came at

a fair cost and, in the end, even ed out. A ccordingly, the Court DENIES both Seller Representative and ICATech’s Motions for Attorney’s Fees and Costs.
IT IS SO ORDERED.

Paul R. Wallace, Judge Original to Prothonotary
cc: All Counsel via File and Serve