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WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Kim Cramton,

Plaintiff,

v. 

Grabbagreen Franchising LLC, et al.,

Defendants.

No. CV-17-04663-PHX-DWL

ORDER 

INTRODUCTION

Between September 2014 and September 2017, Plaintiff Kim Cramton (“Cramton”) 

worked in various capacities for entities associated with the Grabbagreen healthy fast-food 

franchise. In December 2017, Cramton initiated this action by filing a complaint in which 

she asserted tort, contract, and statutory employment claims against entities and individuals 

associated with Grabbagreen (together, “Defendants”). Defendants, in turn, asserted an 

array of counterclaims against Cramton. Finally, in November 2021, after four years of 

hard-fought litigation—which included a motion for terminating sanctions based on the 

destruction of electronically stored information (“ESI”), a finding that Cramton had 

partially waived the attorney-client privilege by producing a hard drive containing

privileged documents to Defendants, litigation over the enforceability of two contractual 

jury waivers, two rounds of summary judgment briefing, a stay occasioned by a corporate 

bankruptcy, and a bench trial conducted during the heart of the pandemic in which a former 

defendant served simultaneously as trial counsel and as a witness—the Court entered 

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judgment in Cramton’s favor on two of her claims, awarding her just over $73,000.

Alas, the entry of judgment did not bring an end to this case but simply served as 

the impetus for a blizzard of new motions. Now pending before the Court are: (1) three 

motions for reconsideration (or similar relief) filed by Defendants (Docs. 467, 473, 475),

which effectively seek to relitigate most of the key adverse rulings against Defendants over 

the last four years; (2) the parties’ dueling motions to be considered the prevailing party 

and recover their attorneys’ fees and costs, with Defendants seeking an award of nearly 

$1.1 million (Doc. 481) and Cramton seeking an award of nearly $400,000 (Doc. 483); and 

(3) Defendants’ motion for an award of over $850,000 in sanctions against Cramton and 

her counsel for pursuing frivolous claims (Doc. 487). 

For the reasons that follow, all of Defendants’ motions are denied and Cramton’s 

motion for attorneys’ fees and costs is granted in part. Specifically, Cramton is awarded

$10,236 in attorneys’ fees against Defendant Eat Clean Operations LLC (“ECO”), which

are the fees that Cramton reasonably expended in pursuit of her successful claim in Count 

Five against ECO for breach of contract, and $210,820 in attorneys’ fees against Defendant 

Keely Newman (“Keely”), which are the fees that Cramton reasonably expended in pursuit 

of her successful claim in Count Four against Keely under the Arizona Minimum Wage 

Act (“AMWA”). Additionally, Cramton is authorized to file a supplemental application 

for the fees she incurred when responding to Defendants’ three reconsideration motions.

DISCUSSION

I. First Motion For Reconsideration—AMWA Claim (Doc. 467)

A. Relevant Background

In Count Four of the operative complaint, Cramton asserted a claim against “All 

Defendants” for violating AMWA by failing to pay her “for any of her employment 

services from December 1, 2016 until her [resignation] in September of 2017.” (Doc. 88 

¶¶ 111-18.) 

In a December 2019 order, the Court concluded that three Defendants—ECO, Eat 

Clean Holdings, LLC (“ECH”), and Kelli Newman (“Kelli”)—were entitled to summary 

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judgment on Cramton’s AMWA claim because none of them qualified as Cramton’s 

“employer” but that Cramton and the remaining two Defendants—Keely and Grabbagreen 

Franchising, LLC (“GFL”)—were not entitled to summary judgment because triable issues 

of fact existed as to whether GFL and Keely paid any wages to Cramton during the period 

in question. (Doc. 247 at 41-46.)

In June 2020, Defendants filed a motion to strike Cramton’s jury demand. (Doc. 

322.)

In an October 2020 order, the Court granted Defendants’ motion in part. (Doc. 345 

at 21-39.) On the one hand, the Court found that Cramton had knowingly and voluntarily 

signed a pair of contractual jury waivers, that Defendants had not forfeited their ability to 

enforce the jury waivers, and that the waivers were broad enough to encompass Cramton’s 

AMWA claim in Count Four against Keely as well as several of her other remaining claims. 

(Id.) On the other hand, the Court held that the waivers were not broad enough to 

encompass Cramton’s AMWA claim in Count Four against GFL. (Id.) Given these 

determinations, the Court severed Cramton’s AMWA claim against GFL from the 

remaining claims and set those claims for a bench trial. (Id.)

The scheduling of the bench trial proved difficult in light of the COVID-19 

pandemic. (Docs. 347, 348, 356, 369, 377, 378.) Finally, in a minute entry issued on 

December 7, 2020, the Court stated that the bench trial would be held in 2021, ordered the 

parties to meet-and-confer about an agreeable date, and informed the parties that “[t]he 

Court’s intent is to hold trial in one calendar week, so the parties should attempt to identify 

three weeks in which they are both available.” (Doc. 378.) 

On December 16, 2020, the parties filed a “Joint Notice Regarding Trial Dates.” 

(Doc. 382.) In this filing, neither side raised any objection to the Court’s plan to complete 

trial in one week. (Id.) Using the dates proposed by the parties, the Court set the bench 

trial for May 24-28, 2021. (Doc. 383.) 

Between December 2020 and May 2021, Defendants filed various motions and 

other documents related to witness matters and trial logistics. (Docs. 384, 387, 390.) In 

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none of those filings did Defendants object to the one-week trial schedule. (Id.)

At the outset of trial on May 24, 2021, the Court “cover[ed] a few housekeeping 

matters.” (Doc. 421 at 20.) One of those matters related to “timing.” (Id. 20-21.) On that 

issue, the Court explained: “[W]e have allocated the entire week for the trial. My general 

schedule when I’m in trial is we’ll go from 9:00 to 10:30, take a morning break, go from 

10:45 to noon. We’ll start up again in the afternoon at 1:30, go until 3:00, take our 

afternoon break and go from 3:15 until 4:30. If . . . we have legal matters we need to 

address, we can address [them] from 1:00 until 1:30, or we can do it in the morning before 

we start at 9:00. So following that schedule we will have about 27.5 hours of trial time 

during the week. So we had previously discussed allocating that time evenly between the 

two parties, so I’ll be keeping track up here.” (Id.) Neither side objected to this approach 

or to the time allocations. (Id.) 

Throughout the remainder of the bench trial, the Court provided frequent updates to 

the parties concerning how much time they had used. (Doc. 422 at 126; Doc. 424 at 117-

18; Doc. 426 at 189; Doc. 427 at 99-100, 221; Doc. 428 at 6, 95, 123, 142, 212, 220.) 

Neither side ever suggested, in response to any of these reminders, that the time allocations 

were insufficient.

On May 28, 2021, the parties gave their closing arguments. (Doc. 428.) Notably, 

although Defendants urged the Court to find that Cramton had exaggerated when 

describing the number of hours she had worked for GFL, Defendants did not identify a 

lower, alternative figure. (Id. at 1098-1101.)

On June 23, 2021, the Court issued its findings of fact and conclusions of law arising 

from the bench trial. (Doc. 429.) With respect to Cramton’s AMWA claim in Count Four 

against Keely, the Court made factual findings that (1) Keely exercised various modes of 

control over Cramton’s employment with GFL, including serving as Cramton’s boss, 

possessing authority to set Cramton’s salary and the salary of other GFL employees, 

controlling Cramton’s schedule, and possessing authority to reduce Cramton’s salary; (2) 

Cramton’s testimony as to the amount of hours she worked for GFL in December 2016 

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(140 hours) and between January 2017 and September 2017 (1,583 hours) was credible; 

and (3) “the periodic payments Cramton received throughout 2017 were loan repayments 

on the ECO promissory note, not wage payments from GFL,” and thus “Cramton stopped 

receiving wages from GFL in early December 2016 and did not receive any such wages 

afterward.” (Id. at 19-21, 26.)1 Based on these factual findings, the Court stated in the 

“Conclusions of Law” section of the order that Keely qualified as Cramton’s employer for 

purposes of Cramton’s work for GFL; that Cramton was entitled to a minimum wage of at 

least $16,957 under AMWA for the hours she worked for GFL between December 2016 

and September 2017; and that Keely was liable for violating AMWA because Cramton did 

not receive any wages for her work for GFL during the period in question. (Id. at 25-27.) 

With respect to the last point, the Court clarified that the health insurance premiums and 

car payments paid by GFL on Cramton’s behalf during the period in question did not 

qualify as “wages.” (Id.) Because trebling is statutorily required under AMWA, the Court 

concluded that Keely was liable to Cramton in the amount of $50,871 on Count Four. (Id.)

On June 28, 2021, the Court solicited the parties’ views as to how to proceed on 

Cramton’s remaining AMWA claim in Count Four against GFL. (Doc. 430.) After 

reviewing the parties’ joint statement (Doc. 432), the Court initially stated that it was 

inclined to schedule a jury trial on that claim. (Id. at 434 at 3-5.) However, at Cramton’s 

request (Doc. 436), the Court then authorized Cramton to file a successive motion for 

summary judgment as to her AMWA claim against GFL. (Doc. 437.)

On October 14, 2021, after considering the parties’ briefing (Docs. 440, 442, 443), 

the Court issued an order denying Cramton’s motion for summary judgment as to her 

AMWA claim against GFL. (Doc. 444 at 6-11.)

On October 26, 2021, Cramton filed a motion to dismiss, with prejudice, her 

AMWA claim in Count Four against GFL. (Doc. 447.) GFL later filed an opposition to 

1 The Court also noted that, “[t]o the extent it is not moot in light of the above 

findings, . . . [Cramton] was not required to record or otherwise keep track of her GFLrelated time. This, in turn, triggers a rebuttable presumption that GFL did not pay the 

required minimum wage. See A.R.S. § 23-364(D). The Court finds that Keely did not 

rebut this presumption.” (Doc. 429 at 20.)

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this motion and a sur-reply further opposing this motion. (Docs. 449, 453.)

On November 23, 2021, the Court issued an order granting Cramton’s motion to 

dismiss her AMWA claim in Count Four against GFL. (Doc. 454.) The order explained: 

“The Court is confronted with an unusual situation—a plaintiff wishes to dismiss all of her 

claims against a particular defendant with prejudice, but that defendant refuses to accept 

this unqualified victory and seeks to force the plaintiff to litigate her claims to completion 

via jury trial. Tellingly, GFL fails to identify any case denying a dismissal request under 

analogous circumstances.” (Id. at 3.)

On November 30, 2021, the Court entered judgment in Cramton’s favor. (Doc. 

461.) Among other things, the judgment ordered that Cramton “recover $50,871 from 

Defendant Keely Newman” but “recover nothing on her claim(s) against . . . GFL.” (Id.)

On December 27, 2021, Keely filed the first motion now pending before the Court—

a motion to alter and amend the Court’s findings and judgment with respect to the AMWA 

claim in Count Four and/or for a new trial on that claim. (Doc. 467.)

On February 14, 2022, Cramton filed an opposition. (Doc. 498.)

On February 22, 2022, Keely filed a reply. (Doc. 505.)

B. The Parties’ Arguments

Keely raises an array of challenges to the Court’s factual findings and legal 

conclusions pertaining to Cramton’s AMWA claim in Count Four. (Doc. 467.) First, 

Keely argues that the Court violated “standard statutory construction principles” when 

concluding that the payments Cramton received in 2017 were ECO loan repayments rather 

than GFL wage payments. (Id. at 3-5.) Second, Keely argues that the Court’s decision to 

characterize the payments as ECO loan repayments was the product of an “unalleged 

contract claim.” (Id. at 5-9.) Keely further argues that the implied contractual analysis 

was faulty because GFL had no incentive to mischaracterize the wage payments as loan 

repayments; because any decision to mischaracterize the payments in this fashion was 

subject to the “condition precedent of approval from GFL’s tax advisors,” who 

subsequently declined to provide such approval; because the GFL board resolution did not 

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exist in December 2016 and does not represent “what the parties actually did”; and because 

any decision to mischaracterize the wage payments as loan repayments was illegal and thus 

“clearly void ab initio.” (Id.) Third, Keely argues that Cramton’s testimony concerning 

the number of hours she worked was inaccurate (and, thus, the Court’s reliance on that 

testimony was misplaced) because Cramton included on-call time that is not compensable 

under Arizona law. (Id. at 9.) Fourth, Keely argues that the Court erred by failing to 

characterize the $548.10 in monthly car payments as wages. (Id. at 9-10.) Fifth, Keely 

argues that she should not be held liable for any AMWA violation in 2016 for two reasons: 

(a) AMWA liability must be calculated on an annual basis, and because Cramton received 

over $180,000 in wages from GFL during the first eleven months of 2016, she cannot assert 

an AMWA claim for unpaid wages in December 2016; and/or (b) Cramton’s testimony as 

to the number of hours she worked in December 2016 is undermined by evidence that 

Cramton was performing various “non-work activities” (including recovering from 

shoulder surgery and working for GGS) during the period in question. (Id. at 10-11.) Sixth, 

Keely argues that because “Cramton failed to notify Keely of Cramton’s purported work 

during every waking hour for GFL,” the purported “suffer or permit to work” requirement 

was not satisfied. (Id. at 11-12.) Seventh, Keely argues that she introduced various pieces 

of evidence at trial that the Court should have viewed as discrediting Cramton’s testimony 

as to the number of hours worked. (Id. at 12.) Eighth, in a related vein, Keely argues that, 

because she instructed Cramton to focus her work on GGS-related matters, “it was 

impossible for Cramton to work 1,723 hours for GFL” and “Cramton was untruthful with 

this Court at trial.” (Id. at 12-13.) Ninth, Keely argues that the Court erred in concluding 

that the final $20,000 payment to Cramton was an ECO loan repayment that followed the 

same pattern as previous payments. (Id. at 13-14.) Tenth, Keely argues that “[t]he trial 

limitations imposed on the Defendants deprived Keely of procedural due process and the 

opportunity to present sufficient evidence on which to base a reliable judgment under 

Count IV.” (Id. at 14-16.) Eleventh, Keely argues that the Court erred in finding that 

Cramton was entitled to a rebuttable presumption under A.R.S. § 23-364(D). (Id. at 16-

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17.) Based on these challenges, Keely seeks either an amendment of the court’s findings 

and conclusions or a new trial. (Id. at 17.)

Cramton opposes Keely’s motion and argues that she is entitled to the attorneys’ 

fees incurred in preparing her response. (Doc. 498.) As an initial matter, Cramton notes 

that because “Keely has not cited any newly discovered evidence, and there has not been 

any intervening change in law, Keely’s motion will succeed only if this Court committed 

a clear or manifest error of law.” (Id. at 4.) Cramton contends that Keely cannot meet this 

standard because all of the arguments raised in her motion are either recycled arguments 

she unsuccessfully raised during earlier stages of the case or new arguments she is 

improperly attempting to raise for the first time. (Id. at 4-5.) More specifically, Cramton 

argues that the Court properly concluded that the ECO payments on the promissory note 

were not “wages” under AMWA and instead were paid “by reason of” her status as an ECO 

noteholder (id. at 5-7); that Keely’s “contract analysis” arguments are irrelevant because 

the Court did not apply contract law (id. at 6); that the Court did not clearly error in 

determining that her hours-related testimony was credible (id. at 7-8); that Keely’s “on-call 

hours” arguments miss the mark because she already excluded those hours from her 

summary (id. at 8); that Keely’s due process challenge to the allocation of time at trial “is 

a seminal example of an unreasonable and vexatious use of these legal proceedings in bad 

faith” (id. at 9); that the Court properly applied the facts to the law in concluding that Keely 

qualified as her employer (id. at 9-10); that the Court properly determined that the car 

payments did not qualify as “wages” (id. at 10); that the Court properly determined that the 

$20,000 payment was an ECO loan repayment, not a GFL wage payment (id. at 10-11);

that all employees in Arizona are entitled to receive a minimum wage for each two-week 

pay period worked (id. at 11); and that the Court properly applied the rebuttable 

presumption under A.R.S. § 23-364(d) (id. at 11-12). 

In reply, Keely begins by arguing that the purported payments on the ECO note 

must be characterized as GFL wage payments because the money came from GFL, GFL 

had no obligation to make payments on ECO’s behalf, and the payments were therefore 

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made “by reason of” Cramton’s employment with GFL and/or were gratuities that qualify 

as wage payments. (Doc. 505 at 1-4.) Next, as for the monthly car payments, Keely 

contends the only way they could escape characterization as wages is if they were 

reimbursement for business expenses, but there is no evidence they served this purpose. 

(Id. at 4-5.) Next, Keely argues that because Cramton’s note with ECO was itself invalid, 

this provides an additional reason why the purported ECO note payments must qualify as 

GFL wage payments. (Id. at 5.) Next, Keely seems to argue that the Court erred by 

considering Trial Exhibit 32—which was admitted by joint stipulation at trial (Doc. 421 at 

24)—in the findings of fact because that exhibit was not mentioned in the complaint or in 

the relevant portions of the Joint Final Pretrial Order. (Doc. 505 at 6.) Next, Keely 

advances various arguments why the GFL board resolution should not be construed as 

evidence that Cramton stopped receiving GFL wages. (Id. at 6-7.) Next, Keely reiterates 

her various challenges to Cramton’s credibility and Cramton’s testimony regarding the 

number of hours worked for GFL. (Id. at 7-10.) Next, with respect to due process, Keely 

reiterates her position that the allocation of time at trial violated her constitutional rights 

and also contends that “AMWA is unconstitutionally vague as applied in the unusually 

harsh manner that it was applied in this case to GFL and Keely.” (Id. at 10.) Next, Keely 

argues that the $20,000 payment to Cramton in September 2017 should be considered 

wages because it “directly ties to Cramton’s work for GFL for closing” a franchise sale. 

(Id. at 11-12.) Next, Keely argues that she shouldn’t be held liable for any AMWA 

violation in December 2016 in light of the $4,615.39 wage payment at the start of that 

month. (Id. at 12.) Finally, Keely argues that Cramton’s request for fees is procedurally 

improper and substantively meritless. (Id. at 12.)

C. Legal Standard

Keely seeks relief under Rules 52(b) and 59(e) of the Federal Rules of Civil 

Procedure. (Doc. 467 at 1.) 

Rule 52(b) is implicated here because the challenge arises from the Court’s issuance 

of findings of fact following a bench trial. Rule 52(b) provides that, “[o]n a party’s motion 

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filed no later than 28 days after the entry of judgment, the court may amend its findings—

or make additional findings—and may amend the judgment accordingly.” Id. Although 

the text of Rule 52(b) does not identify the standard for evaluating such a motion, the 

consensus is that “[p]arties should not use a Rule 52(b) motion to relitigate issues 

previously decided or introduce new theories, but rather to correct ‘manifest legal or factual 

errors’ or to present newly discovered evidence.” 2 Gensler, Federal Rules of Civil 

Procedure, Rules and Commentary, Rule 52, at 51 (2022). See generally Nat. Metal 

Finishing Co., Inc. v. BarclaysAmerican/Commercial, Inc., 899 F.2d 119, 122 (1st Cir. 

1990) (“Rule 52(b) is not intended to allow parties to rehash old arguments already 

considered and rejected by the trial court.”); Crane-McNab v. County of Merced, 773 F. 

Supp. 2d 861, 873 (E.D. Cal. 2011) (“[T]he Rule is not intended to serve as a vehicle for a 

rehearing.”).

Meanwhile, Rule 59(e) is implicated here because the Court incorporated its 

findings and conclusions from the bench trial into a final judgment from which Keely seeks 

relief. Rule 59(e) provides that “[a] motion to alter or amend a judgment must be filed no 

later than 28 days after the entry of the judgment.” Id. Similar to Rule 52(b), although the 

text of Rule 59(e) does not identify the standard for evaluating such a motion, “the view 

prevailing in the circuits is that motions to alter or amend the judgment are generally 

appropriate only in four situations: (1) to correct a manifest error of fact or law; (2) to 

incorporate newly discovered and previously unavailable evidence; (3) to prevent manifest 

injustice; and (4) to address an intervening change in controlling law.” 2 Gensler, supra, 

Rule 59, at 250. See generally Allstate Ins. Co. v. Herron, 634 F.3d 1101, 1111-12 (9th 

Cir. 2011) (agreeing that these are the “four basic grounds upon which a Rule 59(e) motion 

may be granted”). The Ninth Circuit has elaborated that “amending a judgment after its 

entry remains an extraordinary remedy which should be used sparingly” and that it is an 

“abuse[]” of Rule 59(e) to “raise arguments or present evidence for the first time when they 

could reasonably have been raised earlier in the litigation.” Allstate Ins. Co., 634 F.3d at 

1111-12 (cleaned up). Thus, Keely’s requests for relief under Rules 52(b) and Rule 59(e) 

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are functionally quite similar. National Metal Finishing Co., 899 F.2d at 122 (noting “the 

close relationship between Rule 59(e) and Rule 52(b)” and characterizing the relief 

available under those rules as “so similar”).

Finally, to the extent Keely’s motion seeks a new trial as an alternative remedy, that 

request is governed by Rule 59(a), which provides in relevant part that “[t]he court may, 

on motion, grant a new trial on all or some of the issues . . . after a nonjury trial, for any 

reason for which a rehearing has heretofore been granted in a suit in equity in federal court” 

and “may, on motion for a new trial, open the judgment if one has been entered, take 

additional testimony, amend findings of fact and conclusions of law or make new ones, 

and direct the entry of a new judgment.” Id. 

D. Analysis

The Court declines to amend its factual findings under Rule 52(b), alter or amend 

the judgment under Rule 59(e), or grant a new trial under Rule 59(a). In large part, Keely’s 

motion consists of attempting to relitigate the bench trial based on evidence and legal 

arguments that have always been available to her. For example, the motion repeatedly 

attacks the credibility of Cramton as a trial witness,2 which was also a focus of Keely’s 

presentation at trial. This is not, in general, an appropriate way to seek relief under Rules 

52(b) and 59(e). See, e.g., National Metal Finishing Co., 899 F.2d at 122 (“Rule 52(b) is 

not intended to allow parties to rehash old arguments already considered and rejected by 

the trial court.”); Allstate Ins. Co., 634 F.3d at 1111-12 (it is an “abuse[]” of Rule 59(e) to 

“raise arguments or present evidence for the first time when they could reasonably have 

been raised earlier in the litigation”). Nor is the Court persuaded that the ruling in 

Cramton’s favor on the AMWA claim resulted in manifest injustice or that the ruling is 

against the weight of the evidence. Thus, a point-by-point refutation of the many 

arguments raised in Keely’s motion is unnecessary here. As one court stated under 

analogous circumstances: “The court is satisfied that the decision as written is the 

2 See, e.g., Doc. 467 at 6 (“The story Cramton told the Court makes no sense . . . .”); 

id. at 12 (“[I]t was impossible for Cramton to work 1,723 hours for GFL – Cramton was 

untruthful with this Court at trial.”).

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appropriate expression of its reasoning. The court gave much thought to its opinion, and 

while the parties may have written the decision differently, for better or worse, the court 

will deny the parties’ motions to the extent that they seek amendments to the findings of 

fact.” Crane-McNab, 773 F. Supp. 2d at 876.

With that said, a few of Keely’s arguments warrant a specific response. As for the 

attribution of certain testimony to Teresa Mills rather than Dana Mavros (Doc. 467 at 5-6), 

the Court clarifies that its findings and conclusions did not turn on this attribution and 

would remain the same even if the testimony were attributed to Mavros. 

As for the contention that the Court erred by applying the rebuttable presumption 

under A.R.S. § 23-364(D) (Doc. 467 at 16), Keely overlooks that the post-trial order 

specifically found that Cramton’s hours-related testimony was credible and accurate before

addressing the applicability of the presumption and noted that issues related to the 

presumption were therefore potentially “moot.” (Doc. 429 at 19-20.) At any rate, the Court 

now clarifies that it would have reached the same findings and conclusions related to the 

number of hours that Cramton worked even if the presumption were inapplicable in this 

circumstance. Accordingly, there is no need to delve further into presumption’s 

applicability. 

As for Keely’s surprising contention that her state and federal constitutional due 

process rights were violated by the manner in which the Court structured trial, this is a new 

argument that Keely failed to raise at any point during the five-month period after the Court 

announced that the bench trial was scheduled for one week or at any point during the bench 

trial itself, despite the Court’s repeated discussions with the parties during trial about timeallocation issues. At most, Keely can point to the fact that, during a pre-trial conference in 

May 2020, the Court rejected the defense’s request to be allocated a disproportionate share 

of the overall time allocated to the parties for trial. (Doc. 323 at 12-21.) During this 

discussion, Keely never asserted that the Court’s trial-allocation decisions would violate 

her due process or other constitutional rights. Moreover, at the time this discussion took 

place, the trial was scheduled to be a jury trial on a variety of claims. It was only after 

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Defendants subsequently filed a motion to strike Cramton’s jury demand (which the Court 

largely granted despite its late timing) that the trial was converted to a bench trial and the 

scope of the trial was narrowed through the severance of the AMWA claim against GFL. 

It was those developments that subsequently led the Court to reduce the overall length of 

trial to one week (Doc. 378), which again did not trigger an objection by either side. Under 

these circumstances, the Court finds that Keely has forfeited any due process or other 

challenge to the time constraints imposed at trial. 

Alternatively, the challenge fails on the merits. Keely was allocated ample time to 

present a defense to the AMWA charge. The Court also observes that the defense spent 

portions of its time at trial pursuing issues of questionable relevance. Cf. Carbajal v. 

Keefer, 2018 WL 10246987, *2 (D. Colo. 2018) (“Mr. Carbajal’s inability to present all of 

the testimony he wanted to is a function of decisions that he made during the hearing. As 

a result, the Court rejects the argument that the time limitations were unfair or 

unconstitutional.”). See generally Amarel v. Connell, 102 F.3d 1494, 1513 (9th Cir. 1996) 

(“A district court is generally free to impose reasonable time limits on a trial. Time limits 

may be used to prevent undue delay, waste of time, or needless presentation of cumulative 

evidence.”) (citations and internal quotation marks omitted).

During oral argument, Keely also asserted that “it’s clear [she] acted in good faith 

and with reasonable grounds to believe that she did not violate the law.” This argument 

fails because good faith is not a defense to AMWA liability.

Finally, as for Cramton’s request for the fees and costs associated with drafting her 

response, it is addressed in Part IV infra.

II. Second Motion For Reconsideration—ECO Promissory Note (Doc. 473)

A. Relevant Background

In Count Five of the operative complaint, Cramton asserted a claim against ECO for 

breach of a $66,527 promissory note. (Doc. 88 ¶¶ 119-23.) The complaint acknowledged 

that Cramton had received partial payment on the note but alleged that a balance of 

approximately $23,000, plus interest, remained outstanding. (Id.)

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On March 1, 2019, Cramton moved for summary judgment on Count Five, but only 

as to liability. (Doc. 142 at 10-11.) In a nutshell, Cramton argued that the undisputed 

evidence showed that the promissory note was valid and that the full $66,527 balance had 

not been repaid. (Id.)

On April 1, 2019, Defendants filed their response to Cramton’s summary judgment 

motion. (Doc. 158.) With respect to Count Five, ECO seemed to acknowledge that the 

note was backed by adequate consideration. (Doc. 158 at 12 [“ECO issued two promissory 

notes as consideration for the acquisition [of Krowne, a Grabbagreen franchise co-owned 

by Keely and Cramton], one in favor of Keely and another in favor of Cramton.”].) ECO 

also conceded that it had failed to fully repay the note. (Id. [acknowledging “ECO’s 

nonpayment”].) Nevertheless, ECO argued that summary judgment should be denied on 

Count Five because “Cramton and Keely agreed that ECO would only make payments on 

the notes if and only if the store ever generated sufficient cash flow to do so (a circumstance 

that never transpired),” and thus “under the express terms of the note, no payment has come 

due.” (Id.)

On April 16, 2019, Cramton filed a reply in support of her summary judgment 

motion. (Doc. 171.) As for ECO’s contention that the repayment obligation never arose 

because it was contingent on the certain events that never transpired, Cramton argued this 

defense failed for three reasons: (1) the repayment obligation was not, in fact, contingent; 

(2) alternatively, the contingency was met; and (3) further alternatively, the note itself 

provided that the note would become immediately due upon insolvency or bankruptcy. (Id.

at 7.) Cramton also stated, in a footnote, that she had provided a demand for payment in a 

post-resignation letter. (Id. at 7 n.5.)

On December 10, 2019, the Court issued a lengthy tentative ruling addressing 

Cramton’s summary judgment motion and several other then-pending motions. (Doc. 

238.) The tentative ruling explained that “[t]he point” of providing the ruling before oral 

argument was “to allow the parties to focus their argument on the issues that seem salient 

to the Court and to maximize their ability to address any perceived errors in the Court’s 

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logic.” (Id. at 1.) With respect to Count Five, the tentative ruling stated that Cramton’s 

motion should be granted. (Id. at 43-44.) After stating that the parties’ arguments 

concerning when the repayment obligation arose “somewhat miss the mark,” the tentative 

ruling stated that, under A.R.S. § 47-3108(B), the note was “payable on demand.” (Id.) 

The tentative ruling further stated that, because Cramton had submitted undisputed 

evidence showing that she made a demand for payment in her September 2017 resignation 

letter, the repayment obligation had arisen and ECO had breached this obligation by failing 

to pay. (Id.) 

On December 16, 2019, the Court heard oral argument. (Doc. 256.) During the 

portion of the hearing addressing Count Five, the Court asked both sides if they wished to 

be heard with respect to the analysis in the tentative ruling. (Id. at 69-70.) Both sides 

declined this invitation. (Id.)

On December 23, 2019, the Court issued its final order on Cramton’s summary 

judgment motion. (Doc. 247.) With respect to Count Five, the order adopted the analysis 

in the tentative ruling. (Id. at 46-47.)

On January 31, 2020, Defendants’ counsel filed a notice that “Defendant Eat Clean 

Operations, LLC (‘ECO, LLC’) . . . [had] filed a petition for bankruptcy with the United 

States Bankruptcy Court, Southern District of Florida.” (Doc. 254.)

On February 3, 2020, based on this notice, the Court entered an automatic stay as to 

ECO. (Doc. 255.)

On June 28, 2021, following the bench trial, the Court ordered the parties to file a 

joint notice concerning several matters, including the status of the bankruptcy proceeding. 

(Doc. 430.)

On July 12, 2021, the parties filed the joint notice. (Doc. 432.) Among other things, 

it reported that the bankruptcy case had closed on June 15, 2021. (Id. at 2.)

On July 26, 2021, the Court issued an order lifting the stay as to ECO and 

authorizing Cramton to file a summary judgment motion as to the issue of damages on 

Count Five. (Doc. 434.) In response, Cramton filed a motion seeking an award of 

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$23,017.12. (Doc. 440.) The motion later became fully briefed. (Docs. 442, 443.)

On October 14, 2021, the Court issued an order granting Cramton’s motion for 

summary judgment as to damages on Count Five. (Doc. 444 at 12-16.) The Court noted 

that ECO made no effort to dispute Cramton’s proffered evidence, which suggested that 

the outstanding balance of the note was $23,017.12, and only sought to raise meritless 

arguments related to bankruptcy law and Cramton’s ultimate ability to recover on any 

judgment entered against ECO. (Id.)

On November 30, 2021, the Court entered judgment in Cramton’s favor. (Doc. 

461.) Among other things, the judgment ordered that Cramton “recover . . . $23,017.12 

from [ECO], including post-judgment interest at the rate of 0.21% from the date of this

Judgment until paid.” (Id.)

On December 28, 2021, ECO filed the second motion now pending before the 

Court—a motion to alter and amend the judgment on Count Five. (Doc. 473.)

On February 14, 2022, Cramton filed an opposition. (Doc. 499.)

On February 22, 2022, ECO filed a reply. (Doc. 504.)

On April 1, 2022, the Court issued an order requiring supplemental briefing with 

respect to ECO’s motion. (Doc. 508.)

On April 15, 2022, ECO filed its initial supplemental brief. (Doc. 509.)

On April 29, 2022, Cramton filed her responsive supplemental brief. (Doc. 510.)

On May 6, 2022, ECO filed its reply supplemental brief. (Doc. 511.)

B. The Parties’ Arguments

ECO’s motion identifies four reasons why the Court should alter or amend the 

adverse judgment against it on Count Five. (Doc. 473.) First, ECO argues that the 

promissory note underlying Count Five “is unenforceable” for several reasons, including 

that the complaint mischaracterizes it as an agreement to repay Cramton for a $66,527 loan 

she made to ECO (when, in fact, there was no loan) and that “to be lawfully payable at all, 

ECO had to have sufficient profits from its cash flows . . . to pay Cramton under Count V” 

but ECO’s board of managers never agreed to make such a payment. (Id. at 2-4.) Second, 

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ECO accuses the Court of committing a due process violation by concluding, in the 

December 2019 summary judgment order, that A.R.S. § 47-3108 was the applicable statute 

for evaluating when ECO’s repayment obligation arose because Cramton did not cite that 

statute in her complaint or moving papers. (Id. at 4-5.) Third, in a related vein, ECO argues 

that the evidence proffered by Cramton in her initial summary judgment motion showed 

that the promissory note was an “exchange agreement,” not a “negotiable instrument,” and 

thus Cramton’s evidence was insufficient to meet her initial burden of production that a 

breach had occurred. (Id. at 5-7.) Fourth, ECO argues that Cramton’s testimony at trial 

regarding the genesis of the ECO promissory note qualifies as new evidence and also shows 

she “will say anything to this Court regardless of the number of different versions of 

purported ‘facts’ or how contradictory and convoluted her testimony in this case has 

become.” (Id. at 7.)

Cramton opposes ECO’s motion. (Doc. 499.) As for ECO’s first argument, 

Cramton argues that it is irrelevant whether the consideration for the note was an actual 

loan of $66,527 or an equity contribution to Krowne—“all that matters is [that] Eat Clean 

Operations promised to repay Cramton and did not.” (Id. at 4-5.) Cramton also notes that 

ECO seemed to concede the adequacy of the consideration in its summary judgment 

response. (Id.) As for ECO’s second argument, Cramton contends that ECO “tellingly 

fail[s] to present any argument that” the Court’s reliance on A.R.S. § 47-3108 in the 

December 2019 summary judgment ruling “was wrong” and only raises a claim of unfair 

surprise. (Id. at 5-9.) Cramton further contends that any claim of unfair surprise fails for 

two reasons: first, because the Court gave adequate notice by issuing a tentative ruling 

before oral argument that cited § 47-3108 and then giving ECO a chance to address the 

statute at oral argument (which ECO declined to do); and second, because any notice issue 

was harmless in light of the undisputed fact that ECO has since declared bankruptcy and 

the promissory note expressly provides that the balance becomes due upon insolvency or 

bankruptcy. (Id.) As for ECO’s third and fourth arguments, Cramton contends that “other 

than the apparent subjective belief of counsel, there is no documented legal term of art 

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under Arizona law for an ‘exchange agreement’”; that, accordingly, “[t]here is no way to 

legally apply the nonexistent concept of an ‘exchange agreement’ to the failure to pay a 

promissory note”; that to the extent ECO’s argument is an argument over the adequacy of 

consideration, it fails for various reasons; and that there is no evidence that repayment of 

the note was contingent on the store being profitable. (Id. at 9-12.) Cramton concludes by 

arguing that, because ECO’s motion was only filed to harass and delay, the Court should 

award her the fees incurred when drafting her response and order ECO’s counsel to show 

cause why they should not be sanctioned under Rule 11 or 28 U.S.C. § 1927. (Id. at 12.)

In reply, Cramton first argues that the promissory note does not qualify as a 

“negotiable instrument” under Arizona law—and, thus, A.R.S. § 47-3108 is inapplicable—

because it contains a clause barring Cramton from assigning it to third parties without 

ECO’s consent. (Doc. 504 at 2-3.) Next, ECO argues that the issuance of the tentative 

ruling before oral argument was insufficient to avoid unfair surprise because the analysis 

of Count Five was “buried” in the tentative ruling, the ruling was not issued at least 30 days 

before oral argument, and ECO was not afforded an opportunity to submit supplemental 

briefing or discover new facts that might support its position. (Id. at 3-5.) Next, ECO 

reiterates its position that, because Cramton admitted at trial that she did not directly loan 

$66,527 to ECO, the “note is obviously not enforceable.” (Id. at 5-6.) Next, ECO argues 

that “the ECO note facially lacks essential terms for the requisite mutual assent and contract 

formation in order for it even to be possible for this Court to enforce it.” (Id. at 6-7.) 

Finally, ECO disputes Cramton’s contention that it has taken inconsistent positions during 

this litigation and argues that Cramton’s request for sanctions is procedurally improper in 

addition to being substantively meritless. (Id. at 7-8.)

In the April 1, 2022 order soliciting supplemental briefing, the Court ordered the 

parties to address, in more detail, ECO’s arguments concerning the inapplicability of 

A.R.S. § 47-3108 and Cramton’s arguments regarding harmless error. (Doc. 508.)

In its supplemental brief, ECO does not limit itself to the issues raised in the April 

1, 2022 order. Instead, ECO argues that: (1) Cramton’s summary judgment motion as to 

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Count Five was invalid on its face, and thus no response was required, because the motion 

was “completely devoid of any statement or argument that the ECO note is a ‘valid’ or 

‘enforceable’ contract or evidence establishing Cramton’s false allegations underlying 

Count V” (Doc. 509 at 3-5); (2) a “facial review of the ECO note” reveals that it is not 

signed by Cramton, does not impose any obligations on Cramton, and lacks various other 

details, meaning there are “missing essential terms [that] render the ECO note 

unenforceable” (id. at 5-6); (3) the Court “trampled on the party presentation rule” by 

“affirmatively set[ting] out to help Cramton by creating the negotiable instrument 

argument” (id. at 6-7); (4) the theory of consideration that Cramton advanced in her 

summary judgment papers (i.e., the note represents contributions that Cramton made to 

Krowne) is unsupported by the record and differs from the theory alleged in the complaint 

(i.e., the note represents funds that Cramton loaned to ECO) (id. at 7-9); (5) Cramton’s trial 

testimony further contradicts the allegations pertaining to Count Five set forth in the 

complaint (id. at 9); (6) various pieces of evidence show that Krowne’s obligation to repay 

Cramton was never assumed by ECO (id. at 10); (7) the new evidence at trial shows that 

the ECO note was invalid based on fraud in the inducement (id. at 10-11); (8) the ECO 

note does not qualify as a negotiable instrument, and thus A.R.S. § 47-3108 is inapplicable, 

because Cramton had no right to transfer or negotiate the note (id. at 11-13); and (9) 

Cramton is not entitled to relief under the alternative theory that ECO’s repayment 

obligation was triggered by insolvency or bankruptcy because (a) Cramton previously 

argued that the entity that declared bankruptcy was not the same entity as ECO; and (b) the 

note’s provisions regarding insolvency are too ambiguous to be resolved at summary 

judgment (id. at 13-15).

In her responsive supplemental brief, Cramton makes two arguments: (1) the ECO 

note qualifies as a negotiable instrument under A.R.S. § 47-3104 because it was payable to 

order, payable on demand, and did not obligate ECO to do anything other than pay money 

(Doc. 510 at 3-5); and (2) alternatively, any error in applying A.R.S. § 47-3104 was 

harmless because the note specified that ECO would be considered in default (and thus 

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obligated to repay the note) if it became insolvent or the subject of a bankruptcy 

proceeding, the insolvency condition is met because ECO conceded as much in its 

summary judgment response and disclosed no assets in the January 2020 bankruptcy filing, 

and the bankruptcy condition is met because, regardless of the precise identity of the entity 

that filed for bankruptcy, ECO was a subject of the bankruptcy proceeding (id. at 5-7). 

In reply, ECO accuses Cramton of conceding and/or not addressing various 

arguments (Doc. 511 at 1-4); reiterates its position that the note does not qualify as a 

negotiable instrument (id. at 4-6); argues the Court must authorize unspecified additional 

discovery if Cramton is allowed to pursue a negotiable-instrument argument (id. at 6); and 

asserts that the insolvency/bankruptcy argument does not provide an alternative basis for 

upholding the summary judgment ruling because there are disputed issues of fact about 

which entity filed for bankruptcy and the meaning of the insolvency condition (id. at 6-7).

C. Standard Of Review

As noted in Part I.C above, the “four basic grounds on which a Rule 59(e) motion 

may be granted” are: (1) to correct a manifest error of fact or law; (2) to incorporate newly 

discovered and previously unavailable evidence; (3) to prevent manifest injustice; and (4) 

to address an intervening change in controlling law. Allstate Insurance Co., 634 F.3d at 

1111-12. “[A]mending a judgment after its entry remains an extraordinary remedy which 

should be used sparingly.” Id. It is an “abuse[]” of Rule 59(e) to “raise arguments or 

present evidence for the first time when they could reasonably have been raised earlier in 

the litigation.” Id.

D. Discussion

The Court declines to alter or amend the judgment against ECO on Count Five. 

One of ECO’s contentions, which it emphasized during oral argument, is that 

Cramton failed to meet her initial burden of production as to the existence of an enforceable 

contract when moving for partial summary judgment on Count Five in March 2019. (Doc. 

509 at 3 [“Having failed to carry her burden of producing evidence, ECO had no obligation 

to come forward to produce evidence to controvert Cramton’s bald, unsupported and 

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baseless allegations. . . . Cramton moved for summary judgment on Count V arguing only 

that the ECO note was unpaid. [Her motion] is completely devoid of any statement or 

argument that the ECO note is a ‘valid’ or ‘enforceable’ contract or evidence establishing 

Cramton’s false allegations underlying Count V was proffered to this Court.”].) 

This argument is unavailing. To be sure, because Cramton moved for summary 

judgment on a claim on which she would bear the burden of proof at trial, she was required 

to “affirmatively demonstrate that no reasonable trier of fact could find other than for” her. 

Soremekun v. Thrifty Payless, Inc., 509 F.3d 978, 984 (9th Cir. 2007). But Cramton met 

that burden by supporting her summary judgment motion with a copy of the promissory 

note (Doc. 142-6 at 2-3); a declaration in which she authenticated the note, explained its 

genesis, and explained why it was backed by consideration (Doc. 142-2 at 3 ¶¶ 4-7 

[explaining that Cramton and Keely “partnered together to purchase a new Grabbagreen 

store,” that Cramton “invested time and money into the store,” that the store was later 

acquired by ECO, and that “ECO executed a promissory note in favor of me to repay me 

for the funds I had invested in opening and operating the store”]); and deposition testimony 

from Kelli, who acknowledged signing the note on behalf of ECO and stated that the note 

“was consideration for the acquisition of assets of” Krowne (Doc. 142-2 at 44-45). This 

evidence was sufficient to meet Cramton’s initial burden of demonstrating the existence of 

an enforceable contract. See generally Savoca Masonry Co. v. Homes & Son Const. Co., 

542 P.2d 817, 819 (Ariz. 1975) (“It is elementary that for an enforceable contract to exist 

there must be an offer, an acceptance, consideration, and sufficient specification of terms 

so that the obligations involved can be ascertained.”). 

As for ECO’s remaining reconsideration arguments, most are purported defenses to 

Count Five that ECO failed to raise in response to Cramton’s March 2019 summary 

judgment motion. In fact, some of ECO’s new theories are inconsistent with the positions 

it previously took. In its April 2019 summary judgment response, ECO offered an 

extensive discussion of why it agreed to execute the note, even using the term 

“consideration” to describe what Cramton provided in exchange for the note. (Doc. 158 at 

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12 & n.6.) Similarly, when the Court allowed a second round of summary judgment 

briefing related to Count Five, ECO failed to raise any arguments concerning the validity 

or enforceability of the underlying note or the adequacy of the consideration supporting the 

note. (Doc. 442 at 16-17.) Given this backdrop, ECO cannot raise such theories now, for 

the first time, through the guise of a Rule 59(e) motion. Allstate Insurance Co., 634 F.3d 

at 1111-12 (noting that is an “abuse[]” of Rule 59(e) to “raise arguments or present 

evidence for the first time when they could reasonably have been raised earlier in the 

litigation”) (citations and internal quotations marks omitted).

Nor does Cramton’s trial testimony about the genesis of the ECO note qualify as 

new evidence that might support a Rule 59(e) challenge. As Cramton correctly notes in 

her response, although “[t]here may be a nuanced . . . difference in what constitutes 

Cramton’s consideration . . . what is clear is that Eat Clean Operations owed Cramton 

money.” (Doc. 499 at 10.) Additionally, Cramton’s trial testimony on this point was 

consistent with the declaration she submitted in support of her March 2019 summary 

judgment motion.

As for ECO’s contention that the Court erred by relying on A.R.S. § 47-3108, the 

parties’ submissions in response to the call for supplemental briefing demonstrate that any 

error was harmless. The bottom line is that ECO executed and then failed to repay a 

promissory note. One defense ECO raised during the summary judgment process was 

whether its obligation to repay the promissory note was ever triggered, such that its 

undisputed failure to make payments could be characterized as a default. Although the 

Court looked to A.R.S. § 47-3108 for purposes of evaluating whether the repayment 

obligation was triggered, Cramton argued in her summary judgment papers that a different 

provision gave rise to the repayment obligation—specifically, the third paragraph of the 

note, which provided that “[i]f the Borrower becomes insolvent or the subject of a 

voluntary or involuntary proceeding in bankruptcy . . . , then the Lender, upon occurrence 

of this event (a ‘Default’), may at its option and without further notice to the Borrower . . . 

declare any or all of the Indebtedness to be immediately due and payable.” (Doc. 142-6 at 

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2.) If Cramton’s initial argument on this point was correct, any error in looking to § 47-

3108 was harmless and would not implicate the principle of party presentation.

Cramton’s initial argument on this point was, in fact, correct. In January 2020, 

counsel for Defendants filed a notice that “Defendant Eat Clean Operations, LLC (‘ECO, 

LLC’)” had filed a bankruptcy petition in the United States Bankruptcy Court for the 

Southern District of Florida. (Doc. 254.) Based on this filing, the Court entered an 

automatic stay as to ECO. (Doc. 255.) And in a later filing, ECO clarified that it was the 

entity that had filed for bankruptcy—there had simply been a minor name change. (Doc. 

432 at 4 [“There is only one Eat Clean Operations, LLC (‘ECO’) . . . . Under the Kahala 

asset purchase agreement, ECO was required to change its name, and it did so. . . . The 

bankruptcy petition identifies this entity on the first page . . . .”). Given this backdrop, 

ECO’s attempt to question whether it was the entity that filed the bankruptcy petition rings 

hollow—it went out of its way to notify the Court of ECO, LLC’s bankruptcy filing (which 

it had no reason to do if it was unaffected by the proceedings), declined to object when the 

Court entered an automatic stay as to ECO based on the filing of the bankruptcy notice, 

and then reiterated that it was the entity that had filed the bankruptcy petition. 

At any rate, ECO was, at a minimum, a subject of the bankruptcy proceeding that 

arose after ECO, LLC filed the bankruptcy petition, and being the subject of such a 

proceeding was alone enough to qualify as a default (and thus trigger an immediate 

repayment obligation) under the ECO note. (Doc. 142-6 at 2.) Under these circumstances, 

there is no reason to alter or amend the judgment—ECO remains liable to Cramton for 

$23,017.12, albeit for potentially different reasons than set forth in the December 2019 

summary judgment order on liability.

Finally, as for Cramton’s request for the fees and costs associated with drafting her 

response, it is addressed in Part IV infra.

III. Third Motion For Reconsideration—Spoliation Sanctions (Doc. 475)

A. Relevant Background

As discussed in prior orders (Docs. 247, 345, 429), Cramton’s central claim in this 

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case was that Keely duped her into resigning by falsely telling her, during a telephone call 

on September 18, 2017, that a planned sale of Grabbagreen to Kahala had fallen through 

and that the Kahala deal was dead. Cramton resigned shortly after this telephone call. By 

resigning, Cramton essentially forfeited an 18.6% ownership interest she held in 

Grabbagreen. As it turns out, the Kahala deal wasn’t dead—Kahala later purchased the 

Grabbagreen brand for $2.6 million. In the complaint, Cramton asserted a variety of tort 

and contract claims against Defendants in an effort to obtain a share of the sale proceeds. 

Those claims were set forth in Counts 6-10. Cramton ultimately lost on all of those 

claims—some were dismissed at summary judgment and the Court ruled in Defendants’ 

favor on the others following the bench trial.

During the discovery process, Defendants sought to defend against Cramton’s 

resignation-related claims in various ways. In addition to “disputing Cramton’s 

characterization of what Keely said during the fateful phone call on September 18, 2017,” 

Defendants also took the position “that Cramton had friends within Grabbagreen and 

Kahala who were secretly feeding her information about Kahala’s plans”—a theory that, 

“if true, would undermine Cramton’s suggestion that she detrimentally relied on Keely’s 

purported statement.” (Doc. 247 at 3.) Defendants further believed that “the evidence of 

these communications should have been found on Cramton’s company-issued computer 

and cell phone.” (Id.) “Unfortunately, around the time of her departure, Cramton brought 

both devices to a third-party data vendor in an attempt to have them ‘wiped.’” (Id.)

On January 4, 2019, the parties informed the Court of an unresolved discovery 

dispute concerning these issues. (Doc. 111.) As relief, Defendants requested that Cramton 

be ordered to (1) “produce a hard drive containing the data from the Company Phone as it 

was backed up to the iCloud around September 24, 2017” and (2) “submit Ms. Cramton’s 

current cell phone to a forensics expert to be searched for only the relevant communications 

Defendants requested from September 25, 2017, through the end of 2017.” (Id. at 3.)

On January 8, 2019, the Court held a hearing to resolve this discovery dispute. (Doc. 

115.) The Court granted Defendants’ request in part, ordering Cramton’s “counsel to 

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attempt to access [Cramton’s] old iCloud account. [Cramton’s] counsel shall document all 

steps taken in seeking to access the account and provide that information to Defense 

counsel. If the iCloud account cannot be accessed, and Defense counsel is satisfied that 

[Cramton’s] counsel has made a good-faith attempt to obtain access, the Court will not 

require any further relief. If the account can be accessed, [Cramton’s] counsel shall review 

its contents to determine whether it contains any additional texts and emails that were not 

previously produced and that are responsive to Defendant’s previous discovery requests. 

If so, [Cramton’s] counsel shall produce those materials to Defense counsel in order to 

resolve this issue.” (Id.)

On June 14, 2019, the parties informed the Court of further unresolved discovery 

disputes concerning Cramton’s alleged spoliation of evidence. (Docs. 188, 193, 194.) As 

a remedy, Defendants requested “leave to file a Motion for Sanctions.” (Doc. 188 at 1.)

On June 21, 2019, the Court held a hearing to resolve this discovery dispute. (Doc. 

195.) The Court ultimately granted Defendants’ request for leave to file a sanctions 

motion. (Id.) 

On July 22, 2019, Defendants filed the operative version of their sanctions motion. 

(Doc. 206.) The motion later became fully briefed. (Docs. 216, 221.)

In the December 23, 2019 order that resolved the parties’ cross-motions for 

summary judgment, the Court also denied Defendants’ motion for sanctions. (Doc. 247.) 

As an initial matter, the Court noted that “[a]lthough Defendants place heavy emphasis on 

the fact that Cramton arranged to have her company-issued computer and cell phone 

‘wiped’ before returning them,” “the computer technician from P.C. Guru . . . made a 

backup of Cramton’s hard drive, even though she hadn’t requested one, and Cramton 

produced that hard drive to Defendants after it was discovered midway through this case. 

Moreover, the evidence shows that Cramton attempted to transfer the complete contents of 

her company-issued cell phone onto her new cell phone, and Cramton stated in her 

declaration that she has produced all of the texts with [four specified individuals] that were 

saved onto her new phone.” (Id. at 13-14.) Given this background, the Court stated that 

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“unless Defendants can show that some text messages were lost during the hard drive 

backup process and/or that Cramton’s claims about her efforts to retrieve and produce text 

messages from her phone are inaccurate, Rule 37(e) sanctions are unavailable.” (Id. at 14.) 

On that issue, the Court began by observing that “[t]he process of assessing how 

much (if any) ESI is missing has been complicated by the fact that Defendants’ theories 

and allegations on this issue have changed over time” and that Defendants “ultimately 

focused on Cramton’s communications with four witnesses—Wuycheck, Farnell, Cable, 

and Savone—and purported to identify a specific number of missing ESI communications 

pertaining to each witness.” (Id.) The Court also noted that Defendants attempted to raise 

several new arguments and requests in their reply but declined to consider those arguments 

and requests because they came too late. (Id. at 14-15.) The Court acknowledged that this 

was, “in some respects, an unsatisfying outcome because it remains possible that key ESI 

may be missing” and further noted that “Cramton is not blameless in this affair because her 

decision to attempt to wipe her company-issued devices was the catalyst for all of the 

spoliation-related litigation that has ensued,” but the Court concluded that it did “not have 

the time or resources to allow Defendants to keep advancing new claims and theories in 

successive briefs and hearings until one eventually prevails.” (Id. at 16.)

Turning to the four individuals at issue, the Court first addressed whether 

Defendants had proved that any of Cramton’s electronic communications with those 

individuals were, in fact, missing. (Id. at 16-20.) The Court concluded “that Defendants 

have not proved the existence of any lost Wuycheck text messages but have proved the 

existence of one lost Farnell text message, three lost Farnell voicemails, and nine lost Cable 

text messages” and further “assume[d] that 187 Savone text messages are missing.” (Id. at 

20.) Next, the Court addressed whether Cramton had a duty to preserve the missing 

communications. (Id. at 20-23.) The Court concluded that it was only reasonably 

foreseeable that “one Farnell text message and three Farnell voicemail messages” might be 

relevant to future litigation. (Id. at 23.) Next, the Court addressed whether Cramton had 

taken reasonable steps to preserve those pieces of missing ESI (no) and whether those 

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pieces of missing ESI were replaceable (no). (Id. at 23-24.) Next, the Court addressed 

whether Defendants suffered prejudice from the loss of those pieces of ESI and concluded 

they had not. (Id. at 24-26.) Finally, the Court addressed whether Cramton had acted with 

the intent to deprive Defendants of the missing ESI and concluded she had not: 

Although Defendants initially accused Cramton of purposefully destroying 

large volumes of ESI—conduct that might support a finding of intent to 

deprive—most of the purportedly missing ESI still exists and has now been 

produced (if belatedly). Additionally, Cramton told the employee at the 

Verizon store to transfer all of the text messages from her old phone onto her 

new phone. Such conduct is inconsistent with an intent to deprive. Finally, 

although Cramton hasn’t provided a particularly good explanation for why 

she failed to preserve and produce the one Farnell text message and the three 

Farnell voicemails, it’s unlikely (for the reasons . . . above) that any of these 

particular materials contained relevant information, and the Court will not 

infer malicious intent from the loss of a handful of likely-irrelevant bits of 

ESI in a case where a massive amount of ESI has been produced.

(Id. at 26.) Thus, even though “Cramton’s decision to wipe her company-issued cell phone 

and computer before returning them to Defendants was unfortunate” and it was 

“understandable why Defendants would view her conduct with deep skepticism,” the Court 

concluded that sanctions under Rule 37(e) were not warranted. (Id. at 26-27.)

The December 2019 order did not mark the end of the parties’ litigation concerning 

the hard drive onto which the contents of Cramton’s company-issued computer had been 

copied. Before trial, Defendants issued a subpoena to an attorney who had represented 

Cramton around the time of her resignation in 2017. That attorney, in turn, moved to quash 

the subpoena on the ground that any testimony she might provide at trial would be protected 

by the attorney-client privilege. (Doc. 370.) During the ensuing briefing process, 

Defendants argued, inter alia, that because Cramton had voluntarily produced the hard 

drive to them during the discovery process, and the hard drive contained an array of email 

communications between Cramton and her attorney, Cramton had waived the privilege 

with respect to those communications. (Doc. 384.) 

On March 9, 2021, the Court issued an order denying the attorney’s motion to quash, 

concluding that “any privilege was lost when Cramton voluntarily produced the emails to 

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Defendants during the discovery process in this case.” (Doc. 386 at 6.)

During the bench trial, Cramton and the former attorney were both questioned about 

some of the emails that were extracted from Cramton’s hard drive. (See, e.g., Doc. 422 at 

215-17; Doc. 423 at 51-55, 80; Doc. 427 at 809-15.)

 On November 30, 2021, the Court entered judgment in Cramton’s favor. (Doc. 

461.) 

On December 28, 2021, three Defendants (Keely, ECH, and GFL) filed the third 

motion now pending before the Court—a “Rule 59 motion to alter or amend judgment on 

Defendants’ motion for spoliation sanctions.” (Doc. 475.)

On February 14, 2022, Cramton filed an opposition. (Doc. 500.)

On February 22, 2022, the movants filed a reply. (Doc. 506.)

B. The Parties’ Arguments

Defendants fault the Court to failing to “address the prejudice to the defense of 

Count IV” in the December 2019 order denying their request for spoliation sanctions. 

(Doc. 475 at 1-2.) According to Defendants, the texts and emails that Cramton destroyed 

were relevant to the AMWA claim because they would have been useful in undermining 

Cramton’s testimony as to the number of hours she worked for GFL. (Id.) Defendants 

further contend that the analysis in the December 2019 order was flawed because it was 

“materially and substantively inconsistent” with the Ninth Circuit’s decision in Leon v. 

IDX Systems Corp., 464 F.3d 951 (9th Cir. 2006), this Court’s subsequent ruling in Burris 

v. JPMorgan Chase & Co., 2021 WL 4627312 (D. Ariz. 2021), and the decision in 

Williams v. American College of Education, 2019 WL 4412801 (N.D. Ill. 2019). (Id. at 2-

5.) Next, Defendants argue that Cramton violated the discovery rules and withheld 

evidence during earlier stages of this case (id. at 5-6) and that the Court improperly shifted 

the burden onto them when making the challenged rulings (id. at 7). Finally, Defendants 

dispute that they ever presented evolving theories and ask the Court to either “vacate the 

ruling on Count IV against Keely” or order an evidentiary hearing. (Id. at 8.) 

Cramton opposes Defendants’ motion. (Doc. 500.) According to Cramton, the 

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motion simply amounts to “rehashing arguments [Defendants] were unhappy were rejected 

the first time they were raised.” (Id. at 3-4.) Cramton also contends that the Court correctly 

found, in the December 2019 order, that “there was largely no identified missing data or 

ESI in this matter,” that Defendants suffered no prejudice from any missing material, and 

that “Defendants’ argument that there might be destroyed evidence is nothing more than 

an extension of the conspiratorial arguments they have made throughout this litigation.” 

(Id. at 4-5.) As for Defendants’ complaints about the lack of a forensic examination, 

Cramton contends those complaints are “mystifying” because Defendants completed their 

own forensic analysis and didn’t request an evidentiary hearing or forensic examination in 

their sanctions motion. (Id. at 5.) Next, Cramton contends that Defendants cannot 

demonstrate prejudice, let alone manifest injustice, with respect to the two counts on which 

they lost (Counts Four and Five) because “it is difficult to imagine how a missing text, 

voicemail, or email could somehow prove that Plaintiff did not work all of the hours she 

claimed to work, or that she did not have a remaining balance on her promissory note.” 

(Id. at 6.) Next, as for Leon, Burris, and Williams, Cramton contends that they are 

consistent with the analysis in the challenged orders. (Id. at 6-7.) Finally, Cramton argues 

that because Defendants’ motion is frivolous and vexatious, she should be awarded the fees 

and costs she incurred when preparing her response. (Id. at 7-8.)

In reply, Defendants accuse Cramton of committing a felony by attempting to wipe 

her company-owned devices (Doc. 506 at 2); accuse Cramton of perjuring herself at 

various points during this case (id. at 2-3); reiterate their position that Leon and Williams

support the imposition of sanctions (id. at 3); argue that Cramton should have reasonably 

foreseen that her text messages with Savone since mid-2016 would be relevant to her 

AMWA claim (id. at 3-5); argue that Cramton’s spoliation efforts were not limited in the 

manner described in the December 2019 order (id. at 4-5); argue that they never obtained 

a forensic examination of Cramton’s personal phone and accuse Cramton of “procedural 

gimmickry” in attempting to suggest otherwise (id. at 6); argue that any “personal” 

information of Cramton was necessarily relevant to her claims in this action (id. at 6-7); 

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argue that Burris constitutes an intervening change in controlling law (id. at 7-8); accuse 

Cramton’s counsel of making false statements (id. at 8); and argue that Cramton’s 

“retaliatory request for sanctions” should be denied (id. at 8-9).

C. Standard Of Review

As noted in Parts I.C and II.C above, the “four basic grounds on which a Rule 59(e) 

motion may be granted” are: (1) to correct a manifest error of fact or law; (2) to incorporate 

newly discovered and previously unavailable evidence; (3) to prevent manifest injustice; 

and (4) to address an intervening change in controlling law. Allstate Insurance Co., 634 

F.3d at 1111-12. “[A]mending a judgment after its entry remains an extraordinary remedy 

which should be used sparingly.” Id. It is an “abuse[]” of Rule 59(e) to “raise arguments 

or present evidence for the first time when they could reasonably have been raised earlier 

in the litigation.” Id. 

D. Analysis

Defendants’ motion consists, in large part, of repeating spoliation-related arguments 

(or variants thereof) the Court previously rejected or making new arguments they did not, 

for whatever reason, raise at the appropriate time. But “[m]otions that simply ‘rehash’ the 

losing party’s failed arguments or that attempt to rescue failed positions by introducing 

new arguments are routinely and summarily rejected as being outside the proper scope of 

the limited relief available under Rule 59(e).” 2 Gensler, supra, Rule 59, at 251. 

Defendants have not, at any rate, demonstrated that the Court’s previous spoliationrelated rulings were manifestly erroneous, would result in manifest injustice, or are 

undermined by newly discovered and previously unavailable evidence or an intervening 

change in controlling law. Although Defendants waste no opportunity to denigrate 

Cramton’s character and accuse her of various crimes, Defendants never come to grips with 

the fact that Cramton’s efforts to wipe her company-issued computer were unsuccessful—

the computer technician made a backup copy that was timely produced to Defendants as 

part of this litigation. Indeed, that production resulted in a partial waiver of Cramton’s 

attorney-client privilege that Defendants exploited to their benefit at trial. It is an 

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understatement to say that these facts are dissimilar from the facts of Burris (which does 

not, at any rate, qualify as an intervening controlling authority), Leon (which is not an 

intervening authority), and Williams (which is neither intervening nor controlling).

As for Cramton’s iPhone, not only does the Court stand by the analysis set out in 

the earlier rulings,3 but Defendants have not demonstrated that the allegedly missing ESI 

would have had any significant impact on the sole claim as to which Defendants now seek 

relief—the AMWA claim in Count Four.4 At bottom, Defendants’ theory seems to be that 

Cramton should have saved and produced every text message she sent to anyone during 

the eight-month period covering her AMWA claim (i.e., December 2016 through 

September 2017), no matter how personal the subject matter, because they could have used 

those text messages to poke holes in Cramton’s testimony as to the number of hours she 

was working for GFL during the period in question. With the unique vantage point as the 

trier of fact during the bench trial, the Court can say with confidence that such evidence 

would not have been successful in impeaching Cramton’s hours-related testimony. (Doc. 

429 at 20 [“[T]he Court accepts that Cramton was a hard-working employee who often 

worked on mornings, nights, and weekends and concludes that her estimate of hours 

worked for GFL is credible and, if anything, conservative.”].)

Finally, as for Cramton’s request for the fees and costs associated with drafting her 

response, it is addressed in Part IV infra.

...

3 The December 2019 order mistakenly identified Kelli as the author of a declaration 

submitted by Keely. (Doc. 247 at 15, citing Doc. 221-1 at 56-63.) Although Defendants 

characterize this misattribution as a reversible error (Doc. 475 at 5), the December 2019 

order made clear that the Court was also disregarding the declaration for reasons unrelated 

to the qualifications of its author—because it was being offered as part of an improper 

attempt to raise a new argument for the first time in a reply.

4 Tellingly, in their sanctions motion, Defendants excluded Count Four from the list 

of claims they sought to have dismissed as a sanction under Rule 37(e)(1), which is the 

provision that authorizes dismissal when the loss of ESI is prejudicial to the movant. (Doc. 

206 at i [“Defendants hereby jointly seek sanctions against [Cramton] in the form of 

dismissal of Counts I, II, III, V, VI, VII, VIII, and X of [Cramton’s] Amended 

Complaint.”]; id. at 19 [same].) Instead, Defendants largely focused on why the missing

ESI was prejudicial to their defense of Cramton’s resignation-related claims (which they 

subsequently prevailed on at summary judgment or trial).

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IV. Cross-Motions For Attorneys’ Fees And Costs (Docs. 481, 483)

A. Background

1. Cramton’s Claims

In her original complaint, Cramton asserted a variety of claims, including a claim 

under the Family Medical and Leave Act (“FMLA”). (Doc. 1 ¶¶ 78-90.) However, 

Cramton later agreed to voluntarily dismiss her FMLA claim with prejudice. (Doc. 80.)

In her operative complaint, Cramton asserted 10 claims and named five Defendants

(Keely, Kelli, GFL, ECO, and ECH). (Doc. 88.) Those claims fell into four categories. 

First, in Counts One, Two, and Three, Cramton asserted claims under the Americans with 

Disabilities Act (“ADA”) against GFL, ECO, and ECH. (Id. ¶¶ 85-110.) It is not clear 

from the record how Cramton valued those claims. Second, in Count Four, Cramton 

asserted an AMWA claim against all five Defendants. (Id. ¶¶ 111-18.) As reflected in the 

judgment, that claim was ultimately worth $50,871. (Doc. 461.) Third, in Count Five, 

Cramton asserted a claim for breach of the promissory note against ECO. (Doc. 88 ¶¶ 119-

123.) As reflected in the judgment, that claim was ultimately worth $23,017.12 (Doc. 

461.) Fourth, in Counts Six, Seven, Eight, Nine, and Ten, Cramton asserted retaliationrelated tort and contract claims against Keely and ECH. (Doc. 88 ¶¶ 124-62.) During the 

bench trial, Cramton argued that she should receive $483,600 in economic damages based 

on those claims, as well as up to $250,000 in emotional distress damages and 

approximately $700,000 in punitive damages. (Doc. 428 at 191.)

Cramton ultimately prevailed on only two of her claims, the AMWA claim in Count 

Four against Keely and the contract claim in Count Five against ECO. (Doc. 461.) Those 

two claims were worth $73,888.12 in the aggregate. (Id.) As for the remaining claims, the 

FMLA claim in the original complaint was dismissed during the early stages of the case 

(Doc. 80); the 2019 summary judgment order disposed of the ADA claims in Counts One, 

Two, and Three, the AMWA claim in Count Four as to Kelli, ECO, and ECH, and two 

(Counts Six and Eight) of the resignation-related claims (Doc. 247); the remaining three 

resignation-related claims (Counts Seven, Nine, and Ten) were resolved against Cramton 

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following the bench trial (Doc. 429 at 27-28); and Cramton voluntarily dismissed her 

AMWA claim against GFL following the bench trial (Doc. 454).

2. Defendants’ Counterclaims

All five Defendants, as well as an additional Grabbagreen-related entity called Gulf 

Girl Squared (“GGS”), asserted counterclaims against Cramton and Cramton’s spouse. 

(Doc. 95 at 21-29.) In Counterclaim One, GFL, ECO, and ECH asserted a claim for breach 

of various contracts (confidentiality, non-compete, and operating agreements). (Id. at 24.) 

In Counterclaim Two, GFL, ECO, and ECH asserted a tort claim for unfair competition. 

(Id. at 25.) In Counterclaim Three, GFL, ECO, ECH, Keely, and Kelli asserted a claim for 

breach of contract (GGS release). (Id. at 25-26.) In Counterclaim Four, GFL, ECO, and 

ECH asserted a tort claim for wrongful interference with business expectations. (Id. at 26-

27.) This counterclaim was valued at more than $1 million. (Id. [“As a result of Kim 

Crampton’s wrongful interference, GFL, ECO, and ECH assets sold for at least 

$1,000,000.00 less than the price Counterclaimants GFL, ECO, and ECH would have 

obtained for the assets but for Kim Crampton’s wrongful interference.”].) In Counterclaim 

Five, GGS asserted a claim for breach of contract (GGS release). (Id.)

In the December 2019 order, the Court granted summary judgment in favor of 

Cramton and Cramton’s spouse as to all of the counterclaims. (Doc. 247 at 61-72.)

B. The Parties’ Arguments

Each side has filed an affirmative motion for costs and attorneys’ fees, a response 

to the other side’s motion, and a reply. To avoid duplication, the Court will not describe 

all six briefs in sequential order but instead summarize each side’s position.

Keely, GFL, ECH, and ECO (“the moving Defendants”) seek to recover nearly $1.1 

million in costs and attorneys’ fees. (Docs. 481, 497, 501.) The moving Defendants 

contend they should be considered the prevailing/successful parties in this action because 

(1) they wholly prevailed on the most valuable set of Cramton’s claims (the resignationrelated claims for which Cramton sought over $1.2 million); (2) they largely prevailed on 

the FMLA, AMWA, and ADA claims—Cramton sued an array of different entities and 

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individuals but ultimately recovered only against Keely and only on the AMWA claim; 

and (3) although Cramton secured a $23,017.12 judgment on her contract claim in Count 

Five against ECO, she was not the prevailing party as to that claim because she rejected a 

pair of written settlement offers to pay the full requested amount. Given this backdrop, the 

moving Defendants contend they “prevailed on 97% of Cramton’s claims,” or “88% with 

the four counterclaims involving certain Defendants.” (Doc. 481 at 6 & n.4.) The moving 

Defendants also accuse Cramton of needlessly running up the cost of litigation in various 

ways, including by making extortionate settlement demands, engaging in discovery 

misconduct, pursuing certain claims in bad faith, and failing to participate in contractually 

required mediation. (Doc. 481 at 6-12; Doc. 497 at 3.) As for the statutory basis for their 

fee request, the moving Defendants identify the ADA, the FMLA, the Arizona Civil Rights 

Act (“ACRA”), and Arizona’s fee-shifting statute for contract claims, A.R.S. § 12-

341.01(A). (Doc. 481 at 4-5, 8-11.) The moving Defendants also defend the size of their 

fee request (Doc. 481 at 13-17) and contend that Cramton’s fee request is inflated (Doc. 

497 at 7-17). Finally, the moving Defendants argue that, to the extent Cramton obtains any 

recovery, it should be limited to the fees and costs “determined reasonable and necessary 

for Count IV against Keely.” (Doc. 497 at 6.) According to the moving Defendants, those 

costs and fees should be limited to either $1,731.50, or about $18,000, or no more than 

$45,509.42. (Id. at 18.)

Cramton and her spouse seek to recover nearly $400,000 in costs and attorneys’ 

fees. (Docs. 483, 492, 503.) As an initial matter, Cramton contends that AMWA’s costshifting provision is one-sided, such that she is entitled to recover her fees to the extent she 

prevailed on her AMWA claim against Keely but cannot be required to pay fees to the 

remaining Defendants she unsuccessfully sued under AMWA. (Doc. 483 at 2-5.) More 

broadly, Cramton contends that she should be considered the prevailing party for purposes 

of the entire litigation because she was the “net winner,” having prevailed on her AMWA 

claim in Count Four against Keely, on her contract claim in Count Five against ECO, and 

on all of the counterclaims asserted against her (for which Defendants “asserted more in 

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damages . . . than Plaintiff did on her affirmative claims”). (Doc. 483 at 5-6, 15; Doc. 492 

at 2-5.) As for the purported settlement offers concerning Count Five, Cramton argues 

they do not change the prevailing-party calculus because they (1) were not for a sum 

certain, (3) were subject to certain contingencies, (3) were made before Defendants 

appeared in this action, (4) did not provide for Cramton’s attorneys’ fees, and (5) “were 

conditioned upon Plaintiff proving a release of all claims, which would have included [the] 

minimum wage claim.” (Doc. 492 at 4-7 & n.2.) Cramton also defends the size of her fee 

request, noting that she has already reduced it by over $340,000 via the “removal of time 

associated with Plaintiff’s unsuccessful claims, time for multiple attorneys attending 

meetings or conferences, time spent briefing the issue of GFL’s joint and several liability 

under [AMWA], time spent on the defense of the jury trial waiver (and therefore time 

already spent preparing for aspects unique to a jury trial such as voir dire, statement of the 

case and instructions), time related to Defendants’ separate claims against case witnesses 

Jeff Farnell, Juliet Peters and Catherine Peterson, and other time determined to be 

unnecessary or duplicative.” (Doc. 483 at 7, 15.) In contrast, Cramton characterizes the 

moving Defendants’ fee request as “grossly excessive.” (Doc. 492 at 14-15, 18.) 

C. Analysis

In 279 B.C., a king named Pyrrhus led his army into battle against the Romans at 

Asculum. Although King Pyrrhus prevailed in this battle, his army suffered devastating 

losses. Such a result has since become known as a Pyrrhic victory, which is defined as “a 

victory that is not worth winning because so much is lost to achieve it.” Phyrric Victory, 

Merriam-Webster, https://www.merriam-webster.com/dictionary/Pyrrhic%20victory (last 

visited May 27, 2022).

King Pyrrhus has nothing on the parties in this case. After four years of bitter 

litigation in which each side sought more than $1 million in damages, made six-figure 

settlement demands, and spent hundreds of thousands (if not millions) of dollars on legal 

fees, Cramton ultimately obtained a recovery of less than $75,000. Although, as explained 

below, Cramton is entitled to recover some of her attorneys’ fees, nobody truly prevailed.

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1. A.R.S. § 12-341.01(A)

The analysis begins with A.R.S. § 12-341.01(A), which both sides cite in support of 

their respective fee requests. That statute provides in relevant part that “[i]n any contested 

action arising out of a contract, express or implied, the court may award the successful 

party reasonable attorney fees.” It is undisputed that this action arose out of a contract—

Cramton’s claim against ECO in Count Five and several of Cramton’s resignation-related 

claims against Keely and GFL were contract claims, as were several of the moving 

Defendants’ counterclaims against Cramton and Cramton’s spouse. Thus, the first step 

under § 12-341.01(A) is determining who was “successful.”

Under Arizona law, “the trial court has substantial discretion to determine who is a 

‘successful party’” for purposes of § 12-341.01. Fulton Homes Corp. v. BBP Concrete, 

155 P.3d 1090, 1096 (Ariz. Ct. App. 2007). “The decision as to who is the successful 

party for purposes of awarding attorneys’ fees is within the sole discretion of the trial court, 

and will not be disturbed on appeal if any reasonable basis exists for it.” Sanborn v. 

Brooker & Wake Property Mgmt., Inc., 874 P.2d 982, 987 (Ariz. Ct. App. 1994). 

The “successful party” analysis here is complicated by the fact that Cramton sued 

five different Defendants under an array of different contract, tort, and employment 

theories but did not sue each Defendant in each count. Additionally, those defendants (as 

well as another entity) asserted contract-based and tort-based counterclaims against 

Cramton and her spouse. Under the circumstances, the Court concludes that the most 

logical approach is to individually evaluate whether Cramton was successful in relation to 

each Defendant (i.e., Cramton-ECO, Cramton-GFL, Cramton-ECH, Cramton-Keely, 

Cramton-Kelli). The Court possesses particularly broad discretion when deciding how to 

determine the “successful party” in cases involving multiple parties and multiple claims. 

See, e.g., Aspen Biotech Corp. v. Wakefield, 2021 WL 3503399, *18 (Ariz. Ct. App. 2021) 

(“This court has long held that the superior court is not bound to the net judgment rule in a 

multi-party, multi-claim case in the exercise of its discretion. Instead, it may use other 

tests to determine the parties’ relative success concerning the various claims.”); Schwartz 

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v. Farmers Ins. Co. of Ariz., 800 P.2d 20, 25 (Ariz. Ct. App. 1990) (“The trial court 

possesses discretion to determine who is the successful party in multiple-party litigation 

and in cases where there are multiple-parties as well as multiple-claims.”); Pioneer Roofing 

Co. v. Mardian Constr. Co., 733 P.2d 652, 664 (Ariz. Ct. App. 1986) (“Given the thirdparty posture of this litigation and its multiple claims and parties, we hold that the trial 

court’s method of determining who was the ‘successful party’ as to each claim was not an 

abuse of discretion.”).

With that backdrop in mind, to the extent Cramton and a particular Defendant each 

pursued affirmative claims for relief against each other, one approach for deciding which 

side was successful would be to apply the “net winner” test. Ayala v. Olaiz, 776 P.2d 807, 

809 (Ariz. Ct. App. 1989) (“In cases involving various competing claims, counterclaims 

and setoffs all tried together, the successful party is the net winner.”).5 Additionally, “in a 

case involving multiple claims and varied success,” the court may “apply a ‘percentage of 

the success’ or a ‘totality of the litigation’ test.” Berry v. 352 E. Virginia, L.L.C., 228 Ariz. 

9, 261 P.3d 784, 788 (Ariz. Ct. App. 2011) (citation omitted). “Under the totality of the 

litigation rule, . . . [t]here are no strict factors, rather the trial court is afforded discretion in 

reviewing the totality of the litigation.” Medical Protective Co. v. Pang, 25 F. Supp. 3d 

1232, 1240 (D. Ariz. 2014).

Starting with the “net winner” test, the only contract claim on which Cramton 

prevailed was her claim in Count Five against ECO, which resulted in a judgment in her 

favor of $23,017.12. Because ECO did not prevail on any of its contract-based 

counterclaims against Cramton, it follows that Cramton was a net winner in relation to

5 See also Vortex Corp. v. Denkewicz, 334 P.3d 734, 745 (Ariz. Ct. App. 2014) (“Both 

sides in this litigation brought claims arising from their contractual relationships, and both 

prevailed on some of their claims, with damages awarded. In fact, both sides sought large 

sums of money from the other and both fell significantly short of their financial goals in 

the litigation. For cases involving claims and counterclaims in which both sides receive a 

favorable judgment in part, our supreme court has applied the ‘net judgment’ approach, by 

which the ‘prevailing party’ for attorneys’ fees purposes is the party that, when both sides 

are awarded judgments, is awarded a greater amount than the other party. Because each 

side recovered less than the amounts sought, we conclude the net judgment rule is 

applicable.”) (citations omitted).

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ECO. 

This is true despite Cramton’s rejection of the settlement offers concerning Count 

Five. Under A.R.S. § 12-341.01(A), “[i]f a written settlement offer is rejected and the 

judgment finally obtained is equal to or more favorable to the offeror than an offer made 

in writing to settle any contested action arising out of a contract, the offeror is deemed to 

be the successful party from the date of the offer and the court may award the successful 

party reasonable attorney fee.” The first settlement offer, made in September 2017, was 

for ECO to “agree to a 24-month repayment schedule for the remaining balance of the ECO 

Note in exchange for” various items of consideration, including “a full release” of all of 

Cramton’s other claims. (Doc. 481-6 at 14.) This offer was insufficient to undermine 

Cramton’s successful-party status. Not only did not fail to specify the amount that ECO 

would actually pay (it only offered to satisfy “the remaining balance” on the ECO note, 

which the parties disputed), but the $73,888.12 “judgment finally obtained” by Cramton

was more favorable than what Cramton would have received under the offer (i.e., only the 

disputed balance owed on the ECO note, which Cramton valued at $23,017.12 and which 

Defendants valued at $66,527, with no additional recovery against Keely due to the “full 

release”). Similarly, the second settlement offer, made in January 2018, potentially called 

for “ECO to repay Ms. Cramton’s outstanding loan,” but only if Cramton “release[d]” all 

other claims and dismissed the complaint with prejudice. (Doc. 481-6 at 28.) Once again, 

this was insufficiently specific as to the actual amount being offered and less favorable to 

Cramton than the “judgment finally obtained.”

As for three of the remaining Defendants (GFL, ECH, and Kelli), there was no net 

winner—Cramton lost on all of her contract-based claims against those Defendants, who 

in turn lost on all of their contract-based counterclaims against Cramton.

As for the remaining Defendant (Keely), the analysis is complicated by the fact that 

Cramton’s AMWA claim in Count Four was not a contract claim. Accordingly, there is a 

strong argument that Cramton’s award of $50,871 on Count Four does not count for 

purposes of the “successful party” analysis under § 12-341.01. Ramsey Air Meds, L.L.C. 

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v. Cutter Aviation, Inc., 6 P.3d 315, 318 (Ariz. Ct. App. 2000) (“A tort claim does not come 

within the attorneys’ fee statute by being interwoven with an unsuccessful contract 

claim.”). Additionally, because the Court is separately analyzing Cramton’s entitlement to 

fees under the fee-shifting provisions of AMWA, it would be anomalous to allow the 

AMWA claim to separately drive the fee-entitlement analysis under § 12-341.01. Cf. 

Modular Mining Sys., Inc. v. Jigsaw Techs., Inc., 212 P.3d 853, 861 (Ariz. Ct. App. 2009) 

(citing other Arizona cases for the proposition that “where attorney fees award [are] 

affirmed under one theory, [there is] no need to reach arguments pertaining to [an] 

alternative theory”). If Count Four were excluded for either of these reasons, there would 

be no net winner between Cramton and Keely because each lost on all of her contract-based 

affirmative claims. General Cable Corp. v. Citizens Utilities Co., 555 P.2d 350, 354 (Ariz. 

Ct. App. 1976) (“[W]here . . . the trial court has denied relief to both parties, we find that 

neither party is the ‘successful party’ under the provisions of § 12-341.”).6 

The “percentage of the success” and “totality of the litigation” tests produce similar 

outcomes. Cramton obtained 100% of what she sought from ECO. Thus, in relation to 

ECO, Cramton was a successful party no matter which test is used. As for the remaining 

Defendants, Cramton sought more than $1 million in damages from them while they sought 

more than $1 million in damages on their counterclaims. The parties’ settlement demands 

were consistent with these large requests. Cramton made pre-lawsuit settlement demand

of $850,000 (Doc. 481-6 at 18) and, according to Kelli, “the demand [was] unwaveringly 

at or about $750,000 for the entire 4 years” that followed (Doc. 481-2 ¶ 21). Meanwhile, 

in a November 2018 letter, Defendants agreed to enter into a mutual release of claims with 

Cramton, but only if Cramton made a $150,000 settlement payment to them. (Doc. 492-1 

at 73.) Later, in August 2020, Defendants increased their demand: “Cramton pays 

$250,000 to Defendants . . . in exchange for a mutual release of all claims between the 

6 Although Cramton’s spouse avoided liability as to the contract-based counterclaims 

asserted against her, she did not assert any contract claims that might lend themselves to a 

“net winner” analysis. Additionally, it is unclear whether Cramton’s spouse expended any 

funds on her defense that would not have been independently spent defending Cramton.

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parties, inclusive of fees and costs.” (Id. at 81.) It there were ever a case to find that the 

“totality of the litigation” test failed to produce a successful party (apart from Cramton in 

relation to ECO), this would be it. Any victory was Phyrric.

Because Cramton was the successful party in relation to ECO (no matter what test 

is used), she may be entitled to the attorneys’ fees she incurred when pursuing her claim in 

Count Five. However, “there is no presumption that a successful party should be awarded 

attorney fees under § 12-341.01.” Motzer v. Escalante, 265 P.3d 1094, 1095 (Ariz. Ct. 

App. 2011). “The legislature used the phrase ‘may award’ in authorizing the trial judge to 

award a successful contract litigant reasonable attorney’s fees. The natural import of this 

phrase is to vest discretion in the trial court to determine the circumstances appropriate for 

the award of fees.” Associated Indem. Corp. v. Warner, 694 P.2d 1181, 1184 (Ariz. 1985). 

The factors Arizona courts have identified as “useful” in determining whether to award 

fees pursuant to § 12-341.01 include (1) the merits of the claim or defense of the 

unsuccessful party; (2) whether the litigation could have been avoided or settled; (3) 

whether assessing fees would cause extreme hardship; (4) whether the successful party 

prevailed with respect to all relief sought; (5) whether the legal question was novel or had 

been previously adjudicated; and (6) whether an award would discourage other parties with 

tenable claims or defenses from litigating them. Id. 

Having carefully considered those factors, the Court concludes than an award of 

fees and costs would be appropriate here with respect to Cramton’s pursuit of her contract 

claim in Count Five against ECO.

7

 Notably, Cramton only seeks to recover the $10,256 in 

attorneys’ fees related to Count Five that she incurred during the final stages of the case 

following the bench trial. (Doc. 483 at 16; Doc. 483-2 ¶ 14.) Particularly when viewed 

7

In the tentative order issued before oral argument, the Court concluded that Cramton 

should not be awarded any attorneys’ fees under § 12-341.01. However, during oral 

argument, Cramton’s counsel identified reasons why Cramton should be deemed a 

successful party in relation to ECO and be awarded the fees associated with Count Five. 

Upon further consideration, and after re-reviewing the Wakefield, Schwartz, and Pioneer 

Roofing decisions cited above (which address the broad discretion of trial courts to 

determine which parties were successful in relation to each other during multi-party, multiclaim litigation), the Court concludes that Cramton’s arguments on these points have merit 

and has changed the tentative order accordingly. 

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through this lens, ECO’s defenses to the claim were not meritorious, litigation could not 

have been avoided, there has been no suggestion that assessing fees against ECO would 

cause extreme hardship (indeed, it is unclear whether Cramton will be able to recover on 

any fee award against ECO given the bankruptcy proceedings), Cramton received 100% of 

what she sought, the legal questions were not particularly novel, and an award would not 

have an impermissible deterrent effect. The Court also agrees that Cramton should be 

allowed under § 12-341.01(A) to recover the costs and fees associated with responding to 

ECO’s motion for reconsideration as to Count Five and the Court’s call for supplemental 

briefing as to Count Five, because such fees were necessary to preserve Cramton’s 

success.

8

 Accordingly, within 14 days of the issuance of this order, Cramton may file a 

request for those additional fees and costs.

In contrast, even if Cramton and her spouse could be considered “successful parties”

in relation to the remaining Defendants for purposes of § 12-341.01(A) (or even if those 

Defendants could somehow be considered be considered “successful parties” in relation to 

Cramton), the Court would decline in its discretion to award any attorneys’ fees and costs 

pursuant to § 12-341.01(A). Cramton’s large settlement demands contributed to the 

parties’ inability to avoid litigation and any success Cramton achieved was quite modest 

with respect to the overall relief sought (at least as to the non-ECO and -AMWA claims). 

Cf. Motzer, 265 P.3d at 1096 (“[T]he court could find Motzer was the successful party and 

still deny fees under the Associated Indemnity factors.”). Additionally, because Cramton 

is receiving a fee award pursuant to AMWA, this provides another reason to decline to 

award fees under § 12-341.01 apart from the fee award against ECO. Meanwhile, the 

moving Defendants’ counterclaims uniformly lacked merit, their conduct also contributed 

to the parties’ inability to avoid litigation, and they ended up losing on all of their 

counterclaims.

...

8 This makes it unnecessary to resolve Cramton’s alternative claim (Doc. 499 at 12) 

that she is entitled to recover her post-trial briefing fees related to Count Five under 28 

U.S.C. § 1927 and Rule 11.

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2. Civil Rights Statutes

Some of Cramton’s claims arose under civil rights statutes that have their own feeshifting provisions. As noted, Cramton voluntarily dismissed an FMLA claim and then 

had three ADA claims—which were pleaded in the complaint, in the alternative, as ACRA 

claims (Doc. 88 at 10-12)—rejected at summary judgment. The moving Defendants point 

to their uniform success in defending against those claims as one reason why they should 

receive a fee award. (Doc. 481 at 8-10.)

As an initial matter, and as Cramton correctly notes in her response (Doc. 492 at 9), 

the moving Defendants may not seek fees based on their successful defense of Cramton’s 

FMLA claim because the fee-shifting provision of that statute operates in a one-sided 

fashion—it only authorizes an award of fees to a successful plaintiff. 29 U.S.C. 

§ 2617(a)(3) (“The court in such an action shall, in addition to any judgment awarded to 

the plaintiff, allow a reasonable attorney’s fee, reasonable expert witness fees, and other 

costs of the action to be paid by the defendant.”). See, e.g., Rains v. Newmont USA Ltd., 

2015 WL 5665599, *2 (D. Nev. 2015) (“[T]he FMLA’s counsel-fee provision provides for 

fees only for a plaintiff who prevails against a defendant . . . [and] does not carry over to a 

prevailing defendant in an action brought under the FMLA.”); Peak v. Forever Living 

Prods. Int’l, Inc., 2011 WL 13174334, *8 (D. Ariz. 2011) (“FMLA and FLSA . . . have 

mandatory one-way fee-shifting provisions, requiring that a defendant pay a reasonable 

attorney’s fee to a prevailing plaintiff, but not the other way around.”).

In contrast, the moving Defendants may potentially recover fees based on their 

successful defense of the Cramton’s ADA/ACRA claims. However, ”it is much more 

difficult for prevailing defendants to recover fees in civil rights cases than it is for 

prevailing plaintiffs. Defendants may recover attorneys’ fees only ‘upon a finding that the 

plaintiff’s action was frivolous, unreasonable, or without foundation, even though not 

brought in subjective bad faith.’” Advocates for Individuals with Disabilities, LLC v. 

MidFirst Bank, 2018 WL 3545291, *4 (D. Ariz. 2018) (quoting Christianburg Garment 

Co. v. EEOC, 434 U.S. 412, 421 (1978)). “In considering what constitutes a claim that is 

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frivolous, unreasonable or groundless, it is important that a district court resist the 

understandable temptation to engage in post hoc reasoning by concluding that, because a 

plaintiff did not ultimately prevail, his action must have been unreasonable or without 

foundation.” C.W. v. Capistrano Unified Sch. Dist., 784 F.3d 1237, 1245 (9th Cir. 2015) 

(citation omitted). 

The moving Defendants are not entitled to fees under this standard because 

Cramton’s ADA/ACRA claims were not frivolous, unreasonable, or without foundation. 

Although the Court ultimately ruled against Cramton on those claims at summary 

judgment, the adverse ruling presented a fairly close call that required extensive analysis 

(Doc. 247 at 33-41) and was reached only after the Court solicited supplemental briefing 

from Cramton following oral argument (Docs. 242, 243).

3. AMWA

AMWA provides that “[a] prevailing plaintiff shall be entitled to reasonable 

attorney’s fees and costs of suit.” A.R.S. § 23-364(G). This provision is similar to the 

FMLA’s fee-shifting provision in that it operates in a one-sided fashion. Thus, because 

Cramton prevailed on her AMWA claim in Count Four against Keely, she is entitled to 

recover her reasonable attorneys’ fees and costs associated with that claim, even though 

she did not prevail on her AMWA claim against the remaining Defendants or on most of 

her non-AMWA claims. Cf. Mesa Airlines, Inc. v. Davis, 2021 WL 710191, *2 (Ariz. Ct. 

App. 2021) (unpub.) (“AMWA’s fee provision does not . . . refer[] to prevailing in the 

‘action’ as a whole, potentially including other claims unrelated to the asserted minimum 

wage violations. Instead, it simply requires a fee award in favor of the ‘prevailing plaintiff’

in the context of enforcing the provisions of the AMWA itself. That is, ‘prevailing’ on the 

AMWA claim alone (regardless of the employee’s success on other claims) constitutes 

‘prevailing’ for purposes of § 23-364(G).”). 

Because the fee-shifting provision of AMWA uses the word “shall” (as contrasted 

with § 12-341.01(A)’s use “may”), a fee award is mandatory rather than discretionary. 

With that said, Cramton’s recovery must be limited to the “reasonable” fees and costs 

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incurred in pursuing her AMWA claim against Keely. Determining what is reasonable in 

this case is challenging because the evidence bearing on Cramton’s AMWA claim was 

intertwined with the evidence bearing on her other claims. For example, the evidence 

bearing on the number of hours that Cramton worked for GFL, which was relevant to her 

AMWA claim, was also relevant to her unsuccessful resignation-related claims because 

one of her theories as to those claims was that Keely forced her to work under such 

grueling, inhumane conditions that she had no choice but to resign once she was led to 

believe the Kahala deal was dead. (See, e.g., Doc. 428 at 181 [Cramton’s closing argument: 

“[T]hey made the conditions so intolerable for Kim Cramton that she really had no choice 

but to leave once it was clear that [the Kahala deal was dead]—no pay, no sale, cruel work 

environment.”]; id. at 190 [“The evidence is overwhelming that Miss Cramton was lied to 

about there not being a sale, and that she relied on that fraudulent statement to her 

detriment. The Newmans made Miss Cramton work for them for no pay. They . . . just 

ma[de] the conditions so unbearable so that all it took was one lie that a sale was not going 

to happen for them . . . .”].) As another example, the parties’ extensive litigation over 

allegations of discovery misconduct implicated all of Cramton’s claims, not just her 

AMWA claim.

For these reasons, the Court concludes that Cramton’s request for $222,792.40 in 

attorneys’ fees associated with her AMWA claim against Keely (Doc. 483 at 16)9 must be 

9 Cramton’s motion also includes a request to recover non-taxable costs of 

$32,030.82. (Doc. 483 at 16-17; Doc. 503 at 9.) This request is denied. First, although 

the motion asserts that Cramton “has included, in an abundance of caution, a 

comprehensive summary of all costs incurred in the action as part of this Motion” (Doc. 

483 at 17 n.8), no such summary was enclosed as an attachment to the motion or provided 

in either of the accompanying declarations from counsel. The Court thus does not know 

how the requested sum of $32,030.82 was computed. (Although a few of the documents 

attached to counsel’s declarations appear to relate to cost disbursements (Doc. 483-1 at 16, 

38, 44), those costs do not come close to $32,030.82.) This approach violates LRCiv 

54.1(e)(3), which provides that a party moving for attorneys’ fees and non-taxable 

expenses must include an “itemized account of the time expended and expenses incurred” 

and must identify, “[i[n a separate portion of the itemized statement, . . . each related nontaxable expense with particularity. . . . Failure to itemize and verify costs may result in 

their disallowance by the court.” Second, in a related vein, Cramton has not explained

which of the unspecified $32,030.82 in non-taxable costs are attributable to her successful 

claims in Counts Four and Five (and, thus, might be recoverable under AMWA or § 12-

341.01). During oral argument, Cramton argued that any imprecision in this area should 

be excused in light of the Clerk of Court’s failure to timely resolve the parties’ dueling 

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reduced. Although the Court appreciates Cramton’s efforts to exclude litigation activities 

that were related wholly to non-AMWA claims (Doc. 483-1 ¶ 20; Doc. 483-2 ¶ 13-21), the 

request still includes, to an unreasonable degree, entries for time spent on tasks attributable 

both to the AMWA claim and to other unsuccessful claims. Although some of the time 

spent on these tasks is properly recoverable under § 23-364(G), not all of it is necessarily 

recoverable—the overlay of the non-AMWA claims resulted in the tasks taking longer than 

they otherwise would have taken.10 

In the tentative ruling issued before oral argument, the Court stated that, “[i]n the 

absence of a proposal from either party on how to account for this duplication,” a reduction 

from $222,792.40 to $150,000 would be sufficient to account for the duplication. 

However, during oral argument, Cramton’s counsel identified a better and more tailored 

solution. Counsel suggested that, because two of Cramton’s attorneys (Ms. Matheson and 

Ms. Armstrong) worked nearly exclusively on Cramton’s statutory employment claims, 

while Cramton’s remaining attorney (Mr. Feltus) focused most of his efforts on Cramton’s 

commercial and contractual claims, any reduction for duplication should be confined to 

Mr. Feltus’s portion of the AMWA-related fee request. 

The Court agrees that this approach makes sense. Ms. Matheson’s declaration 

explains that her firm “jointly represented Ms. Cramton along with attorneys from” Mr. 

Feltus’s firm and, “[a]lthough not subject to black and white precision, the firms’ 

representation was roughly divided between Plaintiff’s statutory employment claims under 

the Arizona Minimum Wage Act, the Americans with Disabilities Act and the Family 

requests to recover their taxable costs and objections thereto (Docs. 464, 465, 472, 474), 

but it is unclear how this delay could have interfered with Cramton’s ability to properly 

itemize and seek reimbursement for her non-taxable costs, as she was required to do.

10 For purposes of a fee request under A.R.S. § 12-341.01, trial courts have “significant 

discretion to award fees in a matter intertwined with another matter for which it may not 

grant attorney’s fees,” with the caveat that “[a]ttorney’s fees should not be allowed on 

unsuccessful separate and distinct claims that could have been litigated separately.” City 

of Cotttonwood v. James K. Fann Contracting, Inc., 877 P.2d 284, 294 (Ariz. Ct. App. 

1994). It is unclear whether the same rule governs fee requests under A.R.S. § 23-364(G). 

But even if it does, having discretion to award fees for intertwined work is not the same 

thing as being required to award fees for intertwined work and the Court concludes that 

some reduction is necessary here.

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Medical Leave Act . . . and Plaintiff’s commercial and contractual claims and Defendants’ 

commercial and contractual counterclaims.” (Doc. 483-1 ¶ 2.) Ms. Matheson’s declaration 

further establishes that, due to the manner in which she reduced or eliminated various time 

entries (including all “entries involving Ms. Cramton’s unsuccessful claims under the 

Family Medical Leave Act and the Americans with Disabilities Act”), her firm’s request 

for a total in $144,838 in AMWA-related fees reflects only the subset of fees that “were 

reasonable and necessary under the circumstances in this case” to prevail on the AMWA 

claim. (Id. ¶¶ 20-21.) In light of this showing, the Court agrees that the $144,838 portion 

of Cramton’s AMWA-related fee request attributable to Ms. Matheson’s firm need not be 

further reduced.

As for the remaining portion of the fee request—the $77,954.50 in AMWA-related 

fees attributable to Mr. Feltus’s firm (Doc. 483-2 ¶ 21)—the associated billing entries 

indicate that this figure is composed of $17,954.50 in fees for work on “Exclusively 

Minimum Wage” tasks and $60,000 in fees for work on “Intertwined” tasks (Doc. 483-2 

at 91). The Court concludes that the $17,954.50 sum need not be further reduced but the 

$60,000 figure remains too high—although it has already been reduced by Mr. Feltus in 

various ways (Doc. 483-2 ¶¶ 16-21), the Court remains concerned that the overlay of the 

non-AMWA claims resulted in these tasks taking longer than they otherwise would have 

taken. Again, it must be recalled that Cramton sought over $1 million based on the 

commercial and contractual claims on which Mr. Feltus’s firm focused and only $50,871 

on the AMWA claim that was intertwined in certain ways with those other claims. The 

Court concludes that a reduction from $60,000 to $30,000 would be sufficient to account 

for this variable. Cf. Lexington Ins. Co. v. Scott Homes Multifamily Inc., 2016 WL 

5118316, *17 (D. Ariz. 2016) (“The Court is free to exercise this discretion as there is no 

precise rule or formula for determining how to reduce an award for time spent on 

unsuccessful claims under Arizona law.”) (cleaned up). All told, this means that Cramton 

reasonably incurred $192,792.50 in attorneys’ fees in pursuit of her AMWA claim.

Given this reduction, Defendants’ remaining objections to the AMWA-related 

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portions of Cramton’s fee request are unavailing. For example, although Defendants note 

that Cramton’s recovery on her AMWA claim represented only a small fraction of the 

overall recovery she sought in this case (Doc. 497 at 4, 7-8), Defendants fail to explain why 

this sort of comparison would be relevant in assessing the reasonableness of the fees that 

Cramton incurred when pursuing her AMWA claim. Cramton fully prevailed on that 

claim—she sought $50,871 at trial and received 100% of that amount in the final judgment. 

The analysis might be different if Cramton were seeking fees incurred for litigating all of 

her claims, but the $192,792.50 figure avoids such overlap.

Defendants also suggest that “[l]itigation on Count[] IV . . . was superfluous and 

easily could have been avoided.” (Doc. 497 at 7.) This is a puzzling assertion that is belied 

by the record. As discussed above, Defendants’ initial settlement offers to Cramton only 

pertained to Count Five (the ECO claim) and would have required Cramton to release all 

other claims, including the AMWA claim, without recovery. Later, Defendants’ settlement 

posture became even more aggressive—they eventually demanded that Cramton write 

them a check for $250,000 in order to resolve all claims and counterclaims. And even now, 

more than four years after the case began, Defendants continue to attack the legal and 

factual sufficiency of the AMWA claim through voluminous Rule 59(e) motions. Given 

this backdrop, the litigation over the AMWA claim could not have been easily avoided—

Cramton was forced to litigate the claim and is thus statutorily entitled to the reasonable 

fees she incurred in the process. True, Cramton did not make a targeted effort to settle the 

AMWA claim without regard to her other, bigger-ticket claims, but nothing about how 

Defendants litigated this case suggests that such a targeted settlement effort would have 

been successful.

The Court also disagrees with Defendants’ contention that the AMWA claim was a 

“simple, limited and routine” claim that “one lawyer needed only months . . . to settle” and 

that Cramton therefore acted unreasonably by “assign[ing] 4 lawyers” to pursue the claim. 

(Doc. 497 at 4, 10-12.) It is an understatement to say that Defendants have aggressively 

defended against all of Cramton’s claims in this action, including the AMWA claim. 

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Defendants have also been represented by many more attorneys over the course of this case 

than Cramton. (Doc. 481-2 ¶¶ 2, 5, 10, 13-14 [noting that, over the course of this case, 

Defendants were represented by three attorneys from Bryan Cave, four attorneys from 

Tiffany Bosco, three attorneys from Cronus Law, one attorney from Cohen Law, and one 

attorney from Newman Law].) Under these circumstances, the Court will not penalize 

Cramton for retaining a smaller team of skilled attorneys who were able to achieve success 

on her behalf.

In a related vein, Defendants have not established that Cramton’s attorneys failed to 

exercise billing judgment when litigating the AMWA claim, engaged in duplicative work, 

are seeking reimbursement for tasks unrelated to the AMWA claim, or are seeking 

reimbursement for clerical work. (Doc. 497 at 10-15.) Most of Defendants’ arguments on 

these topics are conclusory—for example, Defendants assert that “Cramton’s billing 

records contain numerous entries with secretarial tasks that should have been deducted by

Cramton’s counsel” (Doc. 497 at 15) but do not identify any of the purportedly offending 

entries. Other arguments are internally inconsistent—although Defendants characterize all 

of the spoliation-related litigation as relevant only to Cramton’s resignation-related claims 

(Doc. 497 at 12-15), one of Defendants’ Rule 59(e) motions seeks the reversal of the 

judgment in Cramton’s favor on Count Four based on purported errors in the Court’s 

spoliation analysis (Doc. 475). At any rate, the Court is satisfied that a fee award of 

$192,792.50 would result in compensation only for work on the AMWA claim that was 

reasonable, non-duplicative, and consistent with billing judgment. 

Defendants’ final set of objections concern the reasonableness of the hourly rates 

charged by Cramton’s counsel and, relatedly, whether the fee request exceeds what 

Cramton’s attorneys would have otherwise been entitled to receive under their fee 

agreement with Cramton. (Doc. 497 at 4, 8-9.) Those objections lack merit. Cramton’s 

fee agreement called for a blended hourly and contingent fee under which Cramton would 

pay an hourly rate of $400 to partners, an hourly rate of $275 to associate and contract 

attorneys, and an hourly rate of $160 to paralegals, with these hourly fees representing “a 

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contingent fee which shall not become due unless and until the matter is resolved in 

[Cramton’s] favor.” (Doc. 483-1 at 11.) Although Defendants assert that this matter was 

not “resolved in [Cramton’s] favor” because she received far less than she originally 

sought, Defendants fail to cite any authority in support of their position and the Court is 

unpersuaded—Phyrric though the victory may have been, this action was resolved in 

Cramton’s favor when the Court entered judgment in her favor on several of her claims 

and on all of the counterclaims. Thus, Cramton’s fee request does not exceed what she 

otherwise would be required to pay under the fee agreement. The agreed-to rates in the fee 

agreement are also reasonable for the quality work that Cramton’s experienced attorneys 

performed in this case. See, e.g., Orman v. Central Loan Admin. & Reporting, 2020 WL 

919302, *2 (D. Ariz. 2020) (“Other courts within this district have determined that a 

reasonable rate ‘for highly skilled, experienced, and regarded lawyers’ involved in 

‘complex, high-dollar commercial litigation’ can range as high as $552 per hour. Similarly, 

reasonable associate rates approved in this district have reached $280 per hour.”) (citations 

omitted).

Finally, another touchstone of reasonableness that has guided the Court’s analysis 

here is that an award of $192,792.50 for Cramton’s attorneys’ work on the successful 

AMWA claim, which generated a recovery of just over $50,000, would resemble other fee 

awards that have been upheld the Ninth Circuit in comparable cases. See, e.g., Avila v. 

L.A. Police Dep’t, 758 F.3d 1096, 1105 (9th Cir. 2014) (upholding $579,400 fee award in 

$50,000 FLSA action); Bonnette v. California Health & Welfare Agency,704 F.2d 1465, 

1473 (9th Cir. 1983) (upholding $100,000 fee award in $18,455 FLSA action).

For these reasons, Cramton is entitled to a fee award of $192,792.50 based on her 

successful pursuit of an AMWA claim against Keely. Additionally, Cramton is entitled to 

the recover the $18,027.50 in fees she expended in support of her fee application. (Doc. 

503 at 9.)

11

 This brings the total award to $210,820.

11 In the tentative ruling, the Court concluded this fee request should be reduced by 

50% because it included unsuccessful briefing related to Cramton’s request for fees under 

A.R.S. § 12-341.01. Because the Court has now concluded that Cramton’s request for fees 

under § 12-341.01 should be granted in part, there is no need for a 50% reduction. 

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Finally, Cramton is also entitled to recover the fees and costs she reasonably 

incurred when responding to Defendants’ AMWA- and spoliation-related Rule 59 motions. 

(Docs. 467, 475.) This is because both motions sought the reversal of the judgment in 

Cramton’s favor on Count Four. Accordingly, within 14 days of the issuance of this order, 

Cramton may file a request for those additional fees and costs. 

V. Defendants’ Motion For Sanctions (Doc. 487)

A. The Parties’ Arguments

The final post-judgment motion is Defendants’ motion for sanctions against 

Cramton and Cramton’s counsel. (Doc. 487.) Defendants argue that nearly all of 

Cramton’s losing claims in this action—specifically, the FMLA claim in the original 

complaint, the ADA claims in Counts One, Two, and Three, the AMWA claim in Count 

Four as asserted against ECH, ECO, and Kelli, and several of the resignation-related claims

against ECH and Keely—“were based on legal or factual contentions so weak as to 

constitute objective evidence of frivolousness, improper purpose and recklessness.” (Id. at 

2.) Thus, Defendants seek sanctions under 28 U.S.C. § 1927 and the Court’s inherent 

authority. (Id. at 2-4.) According to Defendants, the cost of defending against Cramton’s 

groundless and frivolous claims was more than $850,000. (Id. at 16.)

Cramton opposes Defendants’ motion on a variety of grounds. (Doc. 493.) As an 

initial matter, Cramton argues that the motion is untimely because the deadline for filing 

post-trial fee motions was January 13, 2022 but Defendants did not file their motion until 

January 26, 2022. (Id. at 2-3.) Separately, Cramton argues that the motion repeatedly 

conflates the standard for liability under 28 U.S.C. § 1927 (which only authorizes an award 

of sanctions against counsel) and pursuant to the Court’s inherent authority. (Id. at 3-4.) 

Next, Cramton argues that, regardless of the applicable standard, sanctions are not 

warranted because none of the challenged claims were frivolous or groundless or asserted 

in subjective bad faith. (Id. at 4-8.) Finally, Cramton argues that the fee request may 

amount to improper double-dipping because “Defendants provide no cognizable 

explanation to the court of how their request in this motion for $864,223.81 in monetary 

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sanctions can be aligned with the $1,033,041 in fees and $24,672.20 in costs separately 

requested by Defendants in their [other] motion for fees and costs.” (Id. at 8-9.)

In reply, Defendants dispute that they have conflated the liability standards, dispute 

that they are double-dipping, advance additional reasons why the challenged claims should 

be considered groundless and frivolous and asserted in bad faith, and argue that their 

motion was not untimely because “the Motion . . . is brought pursuant to 28 U.S.C. § 1927 

and the Court’s inherent authority and not under Rule 54” and “[n]o local rule or case was 

cited as holding that a motion brought pursuant to the Court’s inherent authority is subject 

to the time limitations of Rule 54.” (Doc. 502.)

B. Discussion

Defendants’ sanctions motion is denied.

As an initial matter, the motion is likely untimely. The starting point for the analysis 

is Rule 54 of the Federal Rules of Civil Procedure. Rule 54(d)(2) sets forth various 

procedures governing motions for attorneys’ fees. Under subdivision (d)(2)(B), the general 

rule is that, “[u]nless a statute or a court order provides otherwise,” a motion for attorneys’ 

fees must “be filed no later than 14 days after the entry of judgment” and must “specify the 

judgment and the statute, rule, or other grounds entitling the movant to relief.” However, 

subdivision (d)(2)(E) creates an exception to this general rule, explaining that the 

aforementioned requirements “do not apply to a claim for fees and expenses as sanctions 

for violating these rules or as sanctions under 28 U.S.C. § 1927.” 

Here, Defendants are seeking sanctions under two different sources of authority: (1) 

the Court’s inherent authority; and (2) 28 U.S.C. § 1927. As for the former, there is a 

strong argument that Defendant’s request is subject to the time limitations imposed by Rule 

54(d)(2)(B). This is because a request for sanctions pursuant to the Court’s inherent 

authority is a request based on “other grounds,” as specified in Rule 54(d)(2)(B), and does 

not fall within either of the exceptions enumerated in Rule 54(b)(2)(E) (i.e., a request based 

on a violation of the Federal Rules of Civil Procedure or under 28 U.S.C. § 1927). See, 

e.g., Hill v. Clark, 2012 WL 13018385, *4 (N.D. Ga. 2012) (“The reference to ‘other 

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grounds’ arguably encompasses the court’s inherent power. Moreover, the rule provides 

only two exceptions to the 14-day deadline. . . . The fact that the rule contains an exclusion 

from the 14-day deadline for a motion for attorney’s fees under § 1927 and under the 

federal rules, but does not contain any other exclusionary language, strongly implies that 

Rule 54 applies to a motion seeking attorney’s fees under the court's inherent power.”). 

Accordingly, any request for sanctions pursuant to the Court’s inherent authority 

was due within 14 days of entry of judgment “unless . . . a court order provides otherwise.” 

See Fed. R. Civ. P. 54(b)(2)(B). Here, the 14-day deadline would have been December 13, 

2021, because judgment was entered on November 30, 2021 (Doc. 461), but the Court 

extended that deadline at the parties’ joint request to January 13, 2022. (Docs. 462, 463.) 

Nevertheless, the current motion was not filed until January 26, 2022. (Doc. 487.) This 

was untimely and Defendants do not offer any explanation for why they missed the 

deadline. This alone provides a basis for denying Defendants’ request for inherentauthority fees. In re Veritas Software Corp. Securities Litig., 496 F.3d 962, 972-73 (9th 

Cir. 2007) (“Failure to comply with the time limit in Rule 54 is a sufficient reason to deny 

a motion for fees absent some compelling showing of good cause.”).

To the extent Defendants are seeking fees under 28 U.S.C. § 1927, the procedural 

requirements and deadlines created by Rule 54(d)(2)(B) do not apply. This is because, as 

noted, subdivision (d)(2)(E) expressly exempts motions under § 1927 from subdivision 

(d)(2)(B)’s requirements. Hill, 2012 WL 13018385 at *7 (“A motion for attorney’s fees 

pursuant to § 1927 is specifically exempted from the Rule 54 deadline.”) (citations 

omitted). But a finding that Rule 54(d)(2)(B) was inapplicable does not end the analysis—

it simply means the Court must find some other standard for evaluating the timeliness of 

Defendants’ request for fees under § 1927. 

On that score, although § 1927 itself does not create any deadlines, the Court finds 

it notable that, in a joint motion filed on December 13, 2021, the parties requested “an order 

to extend the deadlines for the parties to submit their respective Memoranda in Support of 

their forthcoming motions for an award of attorney fees and non-taxable costs from 

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December 14, 2021 to January 13, 2022 so that the parties have sufficient time to complete 

the details of their respective submissions.” (Doc. 462.) The Court construed this as a 

request to set a deadline for the submission of all requests for attorneys’ fees and costs—

including, by implication, any request for attorneys’ fees and costs under 28 U.S.C. § 1927. 

(Doc. 463.) This was an eminently reasonable deadline for Defendants to file a sanctions 

request under § 1927—it was six weeks after the entry of judgment—and Defendants’ 

failure without explanation to comply with the court-ordered deadline provides grounds 

for denying their § 1927 sanctions request without regard to Rule 54(d)(2). Although such 

a delay might not, in a different case, be viewed as unreasonable enough to justify the 

denial of a § 1927 sanctions motion on untimeliness grounds, the unique chronology here—

where Defendants filed one voluminous sanctions motion on the January 13, 2022 deadline 

(Doc. 481) but then delayed, without explanation, their filing of a separate sanctions motion 

based on the Court’s inherent authority and § 1927 until about two weeks later—supports 

a finding of unreasonable delay. Home Gambling Network, Inc. v. Piche, 2015 WL 

1734928, *19 (D. Nev. 2015) (“Though the Ninth Circuit has not commented on the issue 

of timeliness in the context of § 1927 sanctions, other courts have held that § 1927 motions 

must be made within a ‘reasonable time’ or ‘as expeditiously as possible’ after the entry of 

judgment, and should not be ‘unnecessarily or unreasonably delayed.’”) (citations 

omitted). 

Alternatively, even if Defendants’ motion were timely in whole or in part, the Court 

would deny it on the merits for the reasons stated in Cramton’s response. Although 

Cramton may have lost on the claims at issue, Defendants have not established an 

entitlement to sanctions under the standards applicable under § 1927 and the Court’s 

inherent authority.

...

...

...

...

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Accordingly, 

IT IS ORDERED that:

1. Defendants’ Rule 52 and Rule 59 motion pertaining to Count Four (Doc. 467) 

is denied.

2. Defendants’ Rule 59 motion pertaining to Count Five (Doc. 473) is denied.

3. Defendants’ Rule 59 motion pertaining to spoliation sanctions (Doc. 475) is 

denied.

4. Defendants’ motion for attorneys’ fees and costs (Doc. 481) is denied.

5. Defendants’ motion for sanctions pursuant to 28 U.S.C. § 1927 and inherent 

authority (Doc. 487) is denied.

6. Cramton’s amended motion for attorneys’ fees and costs (Doc. 483) is 

granted in part and denied in part. Cramton is awarded $210,820 in attorneys’ fees 

payable by Defendant Keely Newman and is awarded $10,256 in attorneys’ fees payable 

by Defendant Eat Clean Operations LLC. 

7. Cramton is also authorized to file a supplemental application for the fees she 

incurred when responding to Defendants’ reconsideration motions (Docs. 467, 473, and 

475) and when responding to the order soliciting supplemental briefing on one of those 

motions (Doc. 508). Such application must be filed within 14 days of the issuance of this 

order.

Dated this 27th day of May, 2022.

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