defendant makes a settlement offer that is rejected by the prospective plaintiff, “the court shall
deny any award of attomey’s fees and costs requested by the party seeking relief under this Act
incurred after the rejection of the written offer of settlement, if the judgment is less than the
amount contained within the offer of settlement.” Jd. (emphasis added). Bill Kay offered
Morgan $2,000 i damages (not to mention $1,000 in attorney’s fees) after receiving Morgan’s
notice and sound r lef Morgan recovered less than that amount at arbitration, so he cannot
recover any fees incurred after he rejected the settlement offer in May 2001.‘

Of the 40.4 hours in attorney time and 2.3 hours of paralegal time for which Morgan
seeks reimbursement, only 8.5 hours of attorney time and 1 hour of paralegal time were incurred
between opening the case file on March 19th and rejecting the settlement offer on May 23rd.
Only 22% of the time for which Morgan seeks compensation is even potentially recoverable.

Of that 9.5 hours, only time relating to the Consumer Fraud Act claim is compensable.
Morgan does not specify in his fee petition whether the time billed relates to that claim, but the
amounts of time in question are small and the three claims involved were largely overlapping.
See Schorsch v. Fireside Chrysler-Plymouth, Mazda, Inc., 677 N.E.2d 976, 979 (ll. App. Ct.
1997) (no need to differentiate where counts are “inextricably intertwined”). Having reviewed

the time entries, the court does not find them excessive. However, Bill Kay need not pay for the

0.4 hours spent by Morgan’s attorney to open the file in the database. Morgan is therefore

“The bar imposed by the Consumer Fraud Act applies when the settlement offer is
rejected in writing. 815 ILCS § 505/10a(h). It appears that Morgan’s rejection was in writing
(prepared on May 23, 2001, according to the fee petition). Even if Morgan’s rejection was not in
writing, however, the court would reach the same result in the exercise of its discretion.

4


—

trial court’s decision to award fees.” Cruz, 674 N.E.2d at 872. In contrast, although the arbitrator
did not specify that Morgan prevailed on his consumer fraud count, the court can properly make
that inference here. As Bill Kay points out, the arbitrator made no finding that Bill Kay acted
with an intent to defraud. Intent to defraud is an element of both the Odometer Act claim and the
common law fraud claim, but not the Consumer Fraud Act claim. See Dobosz v. Barrington
Dodge, Inc., No. 01 C 3394, 2002 WL 31248505, at * 2 (N.D. Ill. Oct. 7, 2002) (Odometer Act);
Capiccioni v. Brennan Naperville, Ine, 791 N.E.2d 553, 558 (Hil. App. Ct. 2003) (common law
fraud); Check v. Clifford Chrysler-Plymouth of Buffalo Grove, Inc., No. 1-01-4095, 2003 WL
21373149, at *8 (Ill. App. Ct. Sept. 3, 2003) (Consumer Fraud Act). Thus, the court may infer
that the arbitrator based the award on the Consumer Fraud Act claim.?

The issue therefore is not whether the court may award fees to Morgan, but whether it
should exercise its discretion to do so. Morgan seeks $7,637.50 in attorney’s fees, most of which
he is statutorily barred from recovering. Under the Consumer Fraud Act, a prospective plaintiff
is required to serve written notice of the alleged violation and demand relief from the prospective

defendant at least 30 days before filing suit. 815 ILCS § 505/10a(h). If the prospective

Notably, if the court could not ascertain which count supported the arbitration award, the
court could resubmit the award to the arbitrator for clarification. The Cruz court could not do so
only because the arbitration at issue was a court-annexed mandatory arbitration rather than a
proceeding under the Uniform Arbitration Act. Cruz, 674 N.E.2d at 873.

3 Arbitrators are not required to state reasons for their awards. Cruz, 674 N.E.2d at 873.
Even if the arbitrator had found an intent to defraud, however, the court would have discretion to
award fees. In that event, the facts would support a violation of the Odometer Act, which
explicitly provides for attorney’s fees. Likewise, if the facts supported a finding of common law
fraud, the facts would also necessarily support a violation of the Consumer Fraud Act (as long as
the fraud occurred in the conduct of commerce or trade). Kleczek, 767 N.E.2d at 922.

3


awarded $1,705 in attorney’s fees.*

JOAWB. GOTTSCHALL
ited States District Judge

SOLE TE ig
DATED: September 18, 2003

58.1 x $200 = $1,620 for attorney time; 1.0 x $85 = $85 in paralegal time; $1,620 + $85 =
$1,705.


Minute Order Form (06/97)

United States District Court, Northern District of linois

ver Magra edge Joan B. Gottschall “than Angod Suge
CASE NUMBER 01 C 3871 DATE 9/18/2003
CASE Morgan vs. Bill Kay Chrysler Plymouth
TITLE
[In the following box (a) indicate the party filing the motion, ¢.g., plaintiff, defendant, 3rd party plaintiff, and (b) state briefly the nature
MOTION: of the motion being presented.)
DOCKET ENTRY:
q) im) Filed motion of [ use listing in “Motion” box above.}
(2) a Brief in support of motiondue__.
@) Oo Answer brief to motion due___. Reply to answer briefdue___.
(4) ia} Ruling/Hearingon___—_—sset for at
(5) Oo Status hearing{held/continued to] (set for/re-set for] on setfor at
(6) oO Pretrial conference[held/continued to) [set for/re-set for]on__setfor___——sat___.
(©) oO Trial[set for/re-set for]on___at
(8) o [Bench/Jury trial) [Hearing) hetd/continuedto___at.
(9) oO This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to]

CIFRCP4(m) (Local Rule 41.1 OOFRCP41{aX(1) OFRCP41(a}(2).

ao [Other docket entry] Enter Order. Plaintiff’s motion for attorney’s fees [20-1, 21-1] is granted in
part. The court awards plaintiff $1,705 in attorney’s fees.

ay a {For further detail see order attached to the original minute order.]
‘No notices required, advised in open court.

‘No notices required. number of notices
Notices mailed by judge’s staff. 19
Y Notified counsel by telephone. | SEP date dock: 2003

97 | Docketing to mai? notices.

Mail AO 450 form. 4unoa LI4LSIG’s

Copy to judge/magistrate judge. Sway

con OR e i 3
Pilea ro J 81 dase

Datehtime reéeived'in. = C2 TV}
central Clerk’s Office



UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS

rer EASTERN DIVISION Entire
ew EP 9 2003
JAMES MORGAN, | lea )
a )
lt! Plaintiff, ) Case No. 01 C 3871
v. )
)
BILL KAY CHRYSLER PLYMOUTH, ) Judge Joan B. Gottschall
)
Defendant.)
ORDER

Plaintiff James Morgan sued defendant Bill Kay Chrysler Plymouth (“Bill Kay”), alleging
violations of the Federal Odometer Requirements Act (“Odometer Act”), 49 U.S.C. § 37210, the
Illinois Consumer Fraud and Deceptive Business Practices Act (“Consumer Fraud Act”), 815
ILCS § 505/2, et seq., and common law fraud. On July 17, 2002, after finding that the parties
were bound by a valid arbitration agreement, the court stayed this matter pending arbitration. At
arbitration, Morgan prevailed and was awarded $1,545.00 in damages. Now before the court is
Morgan’s motion for attomey’s fees, which is granted in part.'

Background

In January 2001, Morgan purchased a used Chrysler Sebring from Bill Kay, which Bill

Kay had purchased at an auction. The auction house had represented to Bill Kay that the car’s

odometer reading was accurate; Bill Kay, in turn, certified that the odometer reading as accurate

‘Although Morgan’s notice of motion states that it is a motion to confer judgment and for
attorney’s fees, the motion itself makes no request for the court to confer judgment (presumably

because Bill Kay has already paid the amount awarded by the arbitrator). d


when it sold the Sebring to Morgan. Morgan, however, subsequently discovered that the
odometer reading was off by nearly 24,000 miles: when the odometer read 37,500, the vehicle’s
internal computer showed the mileage was more than 61,000. Before commencing litigation,
Morgan sent Bill Kay a written notice of the violation and demanded compensation. Bill Kay
offered to pay Morgan $2,000, plus $1,000 for attorneys’ fees. Morgan rejected the offer and
commenced litigation a few days later. After prevailing at arbitration, Morgan now asks the
court to award $7,637.50 in attomey’s fees.
nalysis

Morgan contends that because he prevailed at arbitration, he should be awarded fees
under the Consumer Fraud Act. Fees may be awarded only when by provided by statute or a
contract between the parties. Cruz v. Northwestern Chrysler Plymouth Sales, Inc., 674 N.E.2d
871, 872 (ll. App. Ct. 1996). Attorney’s fees may be awarded to the prevailing party ina
consumer fraud action, in the court’s discretion. 815 ILCS § 505/10a(c); Kleczek v. Jorgensen,
767 N.E.2d 913, 921 (Ill. App. Ct. 2002). Relying on Cruz, Bill Kay opposes a fee award,
arguing that there is no legal basis to award fees because the arbitrator made no finding that
Morgan was a prevailing party under the Consumer Fraud Act. That argument is misplaced. In
Cruz, the plaintiff proceeded on three causes of action, one of which did not provide for
attorney’s fees. Because the arbitration award did not specify on which count the award was
based, and because “[a]ny individual count of the complaint could support the arbitrators’ entire

award” (including the count which did not allow for a fee award), the appellate court reversed the