IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

KAREN WELDIN STEWART, CIR-MI, )

INSURANCE COMMISSIONER OF THE )

STATE OF DELAWARE, )

)

Plaintiff, )

)

v. ) CIVIL ACTION NO. 12-0532-KD-B

)

CONTINENTAL CASUALTY )

COMPANY, )

)

Defendant and )

Third-Party Plaintiff, )

)

v. )

)

COLTIN ELECTRIC, INC., )

)

Third-Party Defendant. )

ORDER

This action is before the Court on the motion for award of statutory award of attorney’s fees 

filed by Plaintiff Karen Weldin Stewart, Cir-Mi, Insurance Commissioner of the State of Delaware 

(the Commissioner) (doc. 195), the evidentiary submission in support of the motion (doc 205) and 

the response in opposition filed by Continental Casualty Company (doc. 207). Upon consideration, 

and for the reasons set forth herein, the motion is GRANTED in part and the Commissioner is 

awarded attorney’s fees in the amount of $110,124.13.

A. Statement of the law

This Court’s jurisdiction is based on diversity and Alabama is the forum state; therefore, the 

court applies the law of the State of Alabama to determine whether a party is entitled to fees and to 

resolve disputes as to the reasonableness of fees. Kearney v. Auto-Owners Ins. Co., 713 F. Supp. 2d 

1369, 1373 (M.D. Fla. 2010) (citing Coastal Roofing Co., Inc. v. David Boland, Inc., 309 F.3d 758, 

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760 (11th Cir. 2002) (“Since Boland's claim for attorneys' fees sounds in state law and reaches us by 

way of federal diversity jurisdiction, we apply the substantive law of Florida, the forum state.” 

(citing Erie R.R. Co. v. Tompkins, 304 U.S. 64 (1938))). “It is clear that statutes allowing for 

recovery of attorney’s fees are substantive for Erie purposes.” McMahan v. Toto, 256 F.3d 1120, 

1132 (11th Cir. 2001) (citation omitted). “As the Supreme Court has stated: 

[I]n an ordinary diversity case where the state law does not run counter to a valid 

federal statute or rule of court, and usually it will not, state law denying the right 

to attorney's fees or giving a right thereto, which reflects a substantial policy of 

the state, should be followed.”

McMahan, 256 F. 3d at 1133 (quoting Alyeska Pipeline Serv. Co. v. Wilderness Society, 421 U.S. 

240, 259 n. 31, 95 S. Ct. 1612, 1622 n. 31, 44 L.Ed.2d 141 (1975) (citation and quotation omitted)).

“Alabama follows the American rule, whereby attorney fees may be recovered if they are 

provided for by statute or by contract” or “special equity”. Jones v. Regions Bank, 25 So.3d 427, 

441 (Ala. 2009) (citations omitted); Hartford Acc. & Indem. Co. v. Cochran Plastering Co., Inc., 

935 So.2d 462, 472 (Ala. Civ. App. 2006) (citations omitted) (same). In this case, Ala. Code § 39–

1–1(b) provides as follows: 

(b) Any person that has furnished labor, materials, or supplies for or in the 

prosecution of a public work and payment has not been made may institute a civil 

action upon the payment bond and have their rights and claims adjudicated in a 

civil action and judgment entered thereon. Notwithstanding the foregoing, a civil 

action shall not be instituted on the bond until 45 days after written notice to the 

surety of the amount claimed to be due and the nature of the claim. The civil 

action shall be commenced not later than one year from the date of final 

settlement of the contract. The giving of notice by registered or certified mail, 

postage prepaid, addressed to the surety at any of its places of business or offices 

shall be deemed sufficient under this section. In the event the surety or contractor 

fails to pay the claim in full within 45 days from the mailing of the notice, then 

the person or persons may recover from the contractor and surety, in addition to 

the amount of the claim, a reasonable attorney's fee based on the result, together 

with interest on the claim from the date of the notice.

Ala. Code § 39-1-1(b). 

There is no dispute that Elkins Constructors, Inc. did not pay the claim submitted by Coltin 

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Electric, Inc. in May 2012. The operative part of the statute provides that in an action against a 

surety, the party suing may seek “in addition to the amount of the claim, a reasonable attorney's fee 

based on the result, together with interest on the claim from the date of the notice.” Id.

“The determination of whether an attorney fee is reasonable is within the sound discretion of 

the trial court.” Kiker v. Probate Court of Mobile County, 67 So.3d 865, 867 (Ala.2010) (citations 

omitted). To reach a decision as to the reasonableness of the attorney’s fees requested, Alabama 

courts consider non-exclusive list of criteria, including: “(1) [T]he nature and value of the subject 

matter of the employment; (2) the learning, skill, and labor requisite to its proper discharge; (3) the 

time consumed; (4) the professional experience and reputation of the attorney; (5) the weight of his 

responsibilities; (6) the measure of success achieved; (7) the reasonable expenses incurred; (8) 

whether a fee is fixed or contingent; (9) the nature and length of a professional relationship; (10) the 

fee customarily charged in the locality for similar legal services; (11) the likelihood that a particular 

employment may preclude other employment; and (12) the time limitations imposed by the client or 

by the circumstances.” Pharmacia Corp. v. McGowan, 915 So.2d 549, 552–53 (Ala. 2004) (citation 

omitted).

“These criteria are for purposes of evaluating whether an attorney fee is reasonable; they are 

not an exhaustive list of specific criteria that must all be met.” Id. The Alabama courts “do not 

suggest that all of these criteria must be met.” Graddick v. First Farmers and Merchants Nat. Bank 

of Troy, 453 So.2d 1305, 1311 (Ala. 1984). Instead, the Supreme Court of Alabama explained that 

“there would hardly ever be a case where the application of attorney's fees brought into play every 

criterion. But they are available for the trial judge to use in connection with each claim for 

attorney's fees.” Id.

The trial court may consider both expert opinion and its own judgment in determining the 

reasonableness of requested fees. See, e.g., Beal Bank, SSB v. Schilleci, 896 So. 2d 395, 404 (Ala. 

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2004) (“ ‘The trial court, in connection with a consideration of the opinion evidence proffered by 

qualified experts, may call to his aid his own estimate of the value of such legal services after 

considering the aforementioned elements and, generally speaking, the allowance rests within the 

sound judicial discretion of the trial court.’ ”) (quoting Ingalls v. Hare, 96 So. 2d 266, 274 (Ala. 

1957)). Overall, “a fee is clearly excessive when after a review of the facts, a lawyer of ordinary

prudence would be left with a definite and firm conviction that the fee is in excess of a reasonable

fee.” Peebles v. Miley, 439 So.2d 137, 143 (Ala.1983).

“The starting point for determining the amount of a reasonable fee is the number of hours 

reasonably expended on the litigation multiplied by a reasonable hourly rate.... The product of these 

two figures is the lodestar and there is a strong presumption that the lodestar is the reasonable sum 

the attorneys deserve.” Bivins v. Wrap It Up, Inc., 548 F.3d 1348, 1350 (11th Cir. 2008) (internal 

citations and quotation marks omitted); Beal Bank, SSB, 896 So. 2d at 408 (“When an applicant for 

attorney fees has carried his burden of showing that the claimed rate and number of hours are 

reasonable, the resulting product is presumed to be the reasonable fee to which counsel is entitled.”) 

(internal quotations omitted) 

The reasonable hourly rate is generally “the prevailing market rate in the legal community 

for similar services by lawyers of reasonably comparable skills, experience, and reputation.” Blum 

v. Stenson, 465 U.S. 886, 895–896 n. 11, 104 S.Ct. 1541 (1984); Norman v. Housing Authority of 

the City of Montgomery, 836 F.2d 1292, 1299 (11th Cir.1988). The “relevant market” is the “place 

where the case is filed.” American Civil Liberties Union of Ga. v. Barnes, 168 F.3d 423, 437 (11th 

Cir.1999) (citation and internal quotation marks omitted).

In determining whether the time expended is reasonable, the Court should not include any 

hours which are “excessive, redundant, or otherwise unnecessary” i.e., hours “that would be 

unreasonable to bill to a client and therefore to one's adversary irrespective of the skill, reputation or 

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experience of counsel.” Norman, 836 F.2d at 1301 (emphasis omitted). Where records show 

unreasonable hours billed, the Court “has two choices: it may conduct an hour-by-hour analysis or it 

may reduce the requested hours with an across-the-board cut” but not both. Bivins, 548 F. 3d at 

1350, 1351-1352 (concluding that the district court erred “in arriving at the lodestar” because it 

“conducted both an hour-by-hour analysis and applied an across-the-board reduction of the 

requested compensable hours.”)

After calculating the lodestar, “[t]he court may then adjust the lodestar to reach a more 

appropriate attorney's fee, based on a variety of factors, including the degree of the plaintiff's 

success in the suit.” Association of Disabled Americans v. Neptune Designs, Inc., 469 F.3d 1357, 

1359 (11th Cir. 2006); Bivins, 548 F. 3d at 1352 (finding that a downward adjustment to the 

lodestar by 50% was “warranted only if the plaintiff was partially successful in his claims” and that 

the “Johnson factors are to be considered in determining the lodestar figure” but “should not be 

reconsidered in making either an upward or downward adjustment to the lodestar—doing so 

amounts to double-counting.”)

B. Analysis

The Commissioner moves the Court for an award of a reasonable attorney’s fee pursuant to 

Ala. Code § 39-1-1(b). The Commissioner argues that she has complied with the conditions set 

forth in the statute and is entitled to an award of $281,154.66, as summarized below: 

1. Attorneys’ fees charged by Burns, Cunningham & Mackey $140,787.501

2. Litigation expenses (costs) by Burns, Cunningham & Mackey $47,802.14

3. Attorney fees charged by Black & Gerngross, P.C. $61,710.70

4. Litigation expenses (costs) by Black & Gerngross $4,690.70

 1 Peter S. Mackey and Clay T. Rossi represented the Commissioner. Mackey seeks fees in the 

amount of $103,565.00 and Rossi seeks fees in the amount of $37,222.50 for a total of $140,787.50.

 

2

 Cargill Ltd. v. Jennings, 308 Fed.Appx. 385, 388 (11th Cir. 2009) (“Cargill submitted affidavits 

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5. Attorneys’ fees charged by Clifford C. Sharpe $5,780.00

6. Attorneys’ fees charged by Emmanuel, Sheppard & Condon $11,197.50

7. Litigation expenses (costs) by Emmanuel, Sheppard & Condon $580.62

8. Attorneys’ fees charged by Faughnan Mendicino $8,605.50

Total $281,154.66

(Docs. 195, 205)

In support the Commissioner has provided the Court with the affidavits of her counsel

2

(docs. 205-1 through 7), the affidavits of two local attorneys, Reggie Copeland, Jr. and Gregory 

Vaughan, in support of the reasonableness of the hourly rate and hours expended (docs. 205-13; 

205-14).3 The Commissioner also provided the billing statements from counsel wherein they 

submit their hourly rates, work performed, and hours expended in this action (docs. 205-8 through 

12).

1. Whether the Commissioner has met the statutory requisites for recovery of an attorney’s 

fee under Ala. Code § 39-1-1(b)

Continental argues that the Commissioner does not meet the statutory requisites for an 

award of attorney’s fees under Alabama Code § 39-1-1(b) and is not entitled to any attorney fees 

because of the disparity between the “the results ultimately obtained . . . in light of the value of the 

claim asserted in [the Commissioner’s] statutory notice and lawsuit.” (Doc. 205, p. 4) Continental 

argues that the statute contemplates attorney’s fees “in addition to the amount of the claim” and 

“based on the result” but since $150,000 is approximately 19% of the amount claimed, $804,827.63, 

 2 Cargill Ltd. v. Jennings, 308 Fed.Appx. 385, 388 (11th Cir. 2009) (“Cargill submitted affidavits 

that detailed the time expended for specific tasks undertaken by its legal counsel from which the 

district court could determine if the time allotted and charges incurred were reasonable. The court 

was entitled to award attorney's fees based on the information in those affidavits.”)

3 Duckworth v. Whisenant, 97 F.3d 1393, 1396–97 (11th Cir. 1996) (“Contrary to Defendant's 

supposition, this circuit has recognized that a movant may meet his burden by producing either 

direct evidence of rates charged under similar circumstances or opinion evidence of reasonable 

rates.”) (italics in original).

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attorney’s fees cannot be in “addition” to the claim; and therefore, “based on the results” - a 

recovery of only 19% - the Commissioner is not entitled to any attorney’s fees. (Doc. 207, p. 5) 

By affidavit, counsel for the Commissioner state that the “results obtained ...were wholly 

satisfactory given the . . . novel questions of law and difficulties involved in prosecuting this case.” 

(doc. 205-1, p. 9, Affidavit of Peter Mackey); doc. 205-3, p. 6, Affidavit of Clay Rossi) Counsel 

also stated that 

The results obtained for the plaintiff were wholly satisfactory given the . . . novel 

questions of law and difficulties involved in prosecuting this case. In light of the 

ruling of the Court precluding presentation of labor costs at the agreed upon rate 

of $45 per hour, the results obtained are satisfactory to the Estate [the 

Commissioner], which has offered to settle[] the matter in full for the payment by 

[Continental] of the sum of $200,000.00 before the firm of Burns Cunningham & 

Mackey was engaged by [the Commissioner] in the Fall of 2013.

(Doc. 205-2, p. 8, Affidavit of Frederick Gerngross) (bracketed text added). 

The controlling statute provides that an award of attorney’s fees is discretionary, i.e., “may 

recover . . . a reasonable attorney’s fee”, and “based on the result.” Ala. Code 39-1-1(b). Thus, the 

sixth criteria identified in Pharamacia - “the measure of success achieved” - is brought into play.

Continental relies upon the decision in Columbus Rock Co. v. Alabama General Ins. Co., 

153 F. Supp. 827 (M.D. Ala. 1957) to argue that the Commissioner is not entitled to an award 

because the recovery was for substantially less than the amount demanded in the statutory notice 

and the amount alleged in the complaint. However, nothing in the statute indicates that the 

Commissioner is not entitled to any attorney’s fees because she did not recover the entire amount 

for which she had sued. Moreover, if, after review of the relevant criteria, the court finds that the 

attorney’s fees are unreasonable, “the appropriate action is not to deny the claim altogether but to 

enter a judgment for a reasonable amount of attorney’s fees.” Willow Lake Residential Ass'n v. 

Juliano, 80 So.3d 226, 240 (Ala. Civ. App. 2010).

2. Whether the fee request is unreasonable

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Continental argues that should the Court find that the Commissioner has met the statutory 

requisites and is entitled to an award of attorney’s fees, the fee request is unreasonable. 

a. Contingency fee agreement

Continental argues that the attorney’s fee requested for Burns Cunningham and Mackey is 

unreasonable because it is limited by their 30% contingency agreement. Continental argues that the 

award should be limited to $43,500 - 30% of $145,000, the net judgment, and that the amount 

should be further reduced “based on the result” as provided in Ala. Code § 39-1-1(b) to an award of 

$7,830.00, which represents 18% of the maximum recovery of $43,500. Continental cites to several 

decisions applying Florida law and argues that where there is a contingency fee agreement, the 

amount due under that agreement becomes the maximum that the Court can award (doc. 207, p. 8). 

However, under Alabama law, whether the fee agreement was fixed or contingent is one 

factor among others for the Court to consider in determining a reasonable attorney’s fee. See 

Hartford Acc. & Indem. Co., 935 So.2d at 474. The Supreme Court of Alabama explained that “[i]f 

someone is willing to take the great risk of giving up the sure quantity for the uncertain, and wins, 

then the uncertain prize should be worth more than the certain one.” Peebles v. Miley, 439 So.2d at 

142. The risk must be considered when determining the reasonableness of a fee, but the fact that 

BCM had a contingent fee agreement with the Commissioner does not bind the Court to find that a 

reasonable attorney’s fee is the amount that BCM would have obtained under the contingency fee 

agreement. Therefore, this argument lacks legal support under Alabama law.

b. Whether the fees are justified

Continental also argues that the attorney’s fees are unreasonable because they are 

unjustified, constitute economic waste, and could have been avoided. Continental points out that the 

fees began to accrue in a “meaningful way” after BCM appeared in September 2013 and that if the 

Commissioner had accepted Continental’s offer of judgment in the amount of $150,000 made soon 

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after BCM’s appearance, “all those fees could have been avoided.” (Doc. 207, p. 10) Continental 

asserts that awarding attorney’s fees that were incurred to obtain a result no greater than the offer of 

judgment would encourage parties to pursue claims and unnecessarily incur expenses when a 

reasonable settlement offer has been made. 

The Commissioner’s decision to go to trial instead of accepting an offer of judgment does 

not appear to fall within the criteria identified in Pharmacia Corp. The Court acknowledges that 

the list of criteria is not exhaustive and that other criteria may be considered. The little Miller Act 

sets forth specific instructions for making an offer of judgment. Ala. Code 39-1-1(d) provides as 

follows: 

(d) In the event a civil action is instituted on the payment bond, at any time more 

than 15 days before the trial begins, any party may serve upon the adverse party 

an offer to accept judgment in favor of the offeror or to allow judgment to be 

entered in favor of the offeree for the money or as otherwise specified in the offer. 

If within 10 days after the service of the offer, the adverse party serves written 

notice that the offer is accepted, either party may then file the offer and notice of 

acceptance together with proof of service and the clerk of the court shall enter 

judgment. An offer not accepted shall be deemed withdrawn and evidence of the 

offer shall not be admissible. If the judgment finally obtained by the offeree is 

less favorable than the offer, the offeree shall pay the reasonable attorney's fees 

and costs incurred by the offeror after the making of the offer. An offer that is 

made but not accepted does not preclude a subsequent offer. When the liability of 

one party to another party has been determined by verdict, order, or judgment, but 

the amount or extent of the liability remains to be determined by further 

proceedings, any party may make an offer of judgment, which shall have the same 

effect as an offer made before trial if the offer is made no less than 10 days prior 

to the commencement of hearings to determine the amount or extent of liability.

Ala. Code 39-1-1(d). 

In relevant part, the statute provides that “[i]f the judgment finally obtained by the offeree is 

less favorable than the offer, the offeree shall pay the reasonable attorney's fees and costs incurred 

by the offeror after the making of the offer.” Id. The statute makes clear that the Commissioner 

would be responsible for Continental’s attorney’s fees incurred after the offer, should the judgment 

finally obtained be less than the offer. Nowhere does the statute indicate that the Commissioner has 

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lost her entitlement to a reasonable attorney’s fee because she did not accept the offer of judgment. 

 The purpose of the little Miller Act is to provide security to the suppliers and 

subcontractors on public works project in lieu of lien rights available on private projects. Johnson 

Controls, Inc. v. Liberty Mut. Ins. Co., - - - So. 3d - - -, 2014 WL 1874599, *10 (Ala. 2014) (not yet 

released for publication) (internal quotation marks and citations omitted) (bracketed texts in 

original). To preclude a plaintiff from obtaining the reasonable attorney’s fees provided by the 

statute, on basis that the plaintiff decided to go to trial rather than accept an offer of judgment that 

the defendant considers reasonable, would run contrary to the purpose of the statute and the security 

provided thereunder. 

The Court, which is familiar with the prevailing rates in the local market, may also act as its 

own expert and rely on its knowledge and experience to determine the reasonableness and propriety 

of the requested fees. See Beal Bank, SSB, 896 So. 2d at 404; Loranger v. Stierheim, 10 F.3d 776, 

781 (11th Cir.1994). The Court finds that the hourly rates requested for BCM attorneys Mackey 

and Rossi are reasonable. BCM requested $275.00 per hour for Mackey who has thirty years of 

experience and specialized experience in construction litigation, and $175.00 per hour for Rossi, an 

associate with nine years of experience including four years in insurance defense.4 Continental has 

not objected to the hourly rates. Goldsby v. Renosol Seating, LLC, 2013 WL 6535253, at *9 (S.D. 

Ala. Dec. 13, 2013) (“[T]his Court's customary hourly rates for attorneys. . . ranges from $250.00 

 4

 The Commissioner provided the affidavit of Gregory Vaughan a local attorney with ten years 

experience in civil practice with the majority involving collection matters including construction 

collection claims. Vaughan states that his hourly rate ranges from $165.00 to $195.00 per hour 

(doc. 205-14). The Commissioner also provided the affidavit of Reggie Copeland, Jr., a local 

attorney with approximately 35 years experience in civil litigation in state and federal courts 

including personal injury, products liability, commercial and governmental liability. Copeland 

stated that he reviewed the billing records provided by BCM and after consideration of the Johnson

factors, offered his opinion that the hours expended were reasonable and that a reasonable hourly 

rate for Mr. Mackey was $275.00 per hour and a reasonable hourly rate for Mr. Rossi was $175.00 

per hour (doc. 205-13). 

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to $300.00 for more experienced and qualified attorneys[ and]$150.00 to $225.00 for less 

experienced attorneys and associates with few years of practice. . .”); Mitchell Co., Inc. v. Campus, 

slip op., 2009 WL 2567889 at *1 & *17-18 (S.D. Ala. Aug. 18, 2009) (finding $275.00 was a 

reasonable rate for an attorney with approximately 34 years of experience); Rhodes v. Davis, 2010 

WL 4260048, *6 (S.D. Ala. Oct. 25, 2010) (finding that $300.00 was a reasonable hourly rate for 

Mackey’s partner William Cunningham and $175.00 was a reasonable hourly rate for Rossi). 

The Court further finds that the work performed and the hours expended as documented by 

BCM and supported by the affidavits of disinterested attorneys appear to be reasonably incurred in 

this action. (Doc. 205-8-12, affidavits Doc. 205-13 and 205-14) However, upon consideration of 

the factors identified in Pharmacia, 915 So.2d at 552–53, primarily the measure of success achieved 

and the contingent fee agreement, and balancing the factors against the purpose of the little Miller 

Act, the Court finds that an across the board cut of twenty-five (25%) is reasonable in this action, 

which results in an award of $105,590.63. ($140,787.50 x .25% = $35,196.87) 

Mackey stated in his affidavit that when BCM was originally retained by Coltin, a $5,000 

retainer was paid to BCM, and that the retainer was exhausted on the Commissioner’s motion to 

intervene, thus, any award of fees should be reduced by that amount or that Coltin should be 

reimbursed (doc. 205-1, p. 4). Accordingly, the Commissioner’s request for an award of a 

reasonable attorney’s fee is granted in part and the Commissioner is awarded $100,590.63 as a 

reasonable attorney’s fee for the work performed by BCM. 

c. Whether the Commissioner’s request for fees from multiple firms is unreasonable

Continental argues that the Commissioner’s request is unreasonable because she failed to 

meet her burden of demonstrating that the time spent by the attorneys reflects the distinct 

contribution of each lawyer and law firm to the case and the customary practice of multiple-lawyer 

litigation. Continental argues that the Commissioner is only entitled to recover fees for multiple 

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attorneys if she shows makes this showing. 

In Norman, the circuit court explained that “[r]edundant hours generally occur where more 

than one attorney represents a client. There is nothing inherently unreasonable about a client having 

multiple attorneys, and they may all be compensated if they are not unreasonably doing the same 

work and are being compensated for the distinct contribution of each lawyer.” 836 F.2d at 1301–

1302. In that regard, this Court has stated that 

“[T]here is nothing inherently unreasonable about a client having multiple 

attorneys. For that reason, a reduction for redundant hours is warranted only if 

the attorneys are unreasonably doing the same work. An award for time spent by 

two or more attorneys is proper as long as it reflects the distinct contribution of 

each lawyer to the case and the customary practice of multiple-lawyer litigation. 

Thus, a fee applicant is entitled to recover for the hours of multiple attorneys if 

he satisfies his burden of showing that the time spent by those attorneys reflects 

the distinct contribution of each lawyer to the case and is the customary practice 

of multiple-lawyer litigation. But the fee applicant has the burden of showing 

that, and where there is an objection raising the point, it is not a make-believe 

burden.” Barnes, 168 F.3d at 432 (internal citations and quotations omitted). See 

also Johnson v. Univ. Coll. of Univ. of Ala. in Birmingham, 706 F.2d 1205, 1208 

(11th Cir.1983), holding modified on other grounds, Gaines v. Dougherty Cnty. 

Bd. of Educ, 775 F.2d 1565 (11th Cir.1985) (“While Johnson recognizes the 

possibility of unnecessary duplication for which double compensation should not 

be t, 488 F.2d at 717, a reduction is warranted only if the attorneys are 

unreasonably doing the same work.”).

Oden v. Vilsack, 2013 WL 4046456, *9 (S.D. Ala. Aug. 9, 2013 (slip copy)

i. Black and Gerngross, P.C.

Continental argues that the Commissioner has not met her burden to show that she is entitled 

to recover the $61,710.70 charged for the time spent by Frederick Gerngross. Continental argues 

that Gerngross’ participation was that of a liaison or client representative who filed no documents 

other than a motion for pro hac vice admission, did not participate in trial except for jury selection, 

and was the only client representative in the courtroom during trial. Continental points out that in 

Gerngross’ affidavit he states that he was compelled to participate in and monitor the pre-trial 

matters and to attend trial to represent the Commissioner’s interests. Continental also argues that 

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Gerngross’ billing statements are heavily redacted such that the Court cannot ascertain the work 

performed, and therefore, the Commissioner has not met her burden to document the work 

performed and hours. 

The billing statements appear to have been redacted to exclude work performed for other 

clients. Thus, the descriptions of the work performed and time expended as to this action are 

reasonably ascertainable from the statements.5 In that regard, the majority of the time entries are for 

review and analysis and follow-up regarding work performed by Faughnan Mendicino, PLLC, 

BCM, or Clifford C. Sharpe and emails, telephone conferences, and follow-up conversations

regarding the work performed. 6 Although Gerngross states that in his opinion, there was no 

unnecessary duplication of effort between him and other counsel (doc. 205-2, p. 5, affidavit),

nothing in the descriptions of the work performed indicates any distinct contribution by Gerngross

but instead his work appears to be redundant of that performed by other counsel. When awarding 

an attorney's fee, the “[c]ourts are not authorized to be generous with the money of others, and it is 

as much the duty of courts to see that excessive fees and expenses are not awarded as it is to see that 

an adequate amount is awarded.” Barnes, 168 F.3d at 428. Accordingly, the Commissioner’s 

request for attorney’s fees as to Black and Gerngross is denied. 

ii. Clifford C. Sharpe

Continental argues that the Commissioner has not met her burden to show that she is entitled 

to recover the $5,780.00 charged for the time spent by attorney Clifford C. Sharpe. Continental 

argues that the Commissioner failed to show the distinct contributions of Sharpe to her action 

 5

 The Court notes that several time entries appear to have been reduced by hand-written notations 

of lesser numbers of hours than the printed time entry. (Doc. 205-9, p. 93-97)

6

 For example, one entry reads – “Review and analysis of Claims Summary of Fred Mendicino; 

review and analysis of Court Order re: Expert Deposition; follow up with P. Mackey re: Staak 

analysis and agreement for settlement, extent of claim and damages; conference with Staak re: 

same; follow up with Staak re: request for production, Rodgers input to claim; conference with P. 

Mackey, discovery order and sanctions.” (Doc. 205-9, p. 80) 

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against Continental. First, Continental argues that Sharpe represented the Commissioner on her 

motion for substitution, which was opposed by Coltin, and thus his substantive efforts were related 

to a dispute between Coltin and the Commissioner as to the proper claimant. Second, Continental 

argues that after the motion for substitution was granted and BCM appeared on behalf of the 

Commissioner, the time entries indicate that Sharpe reviewed court filings that were otherwise 

reviewed by BCM. Thus, as to the latter, there is no evidence that he performed any work to 

advance the Commissioner’s claims that was not already performed by BCM attorneys. 

As with Gerngross, Sharpe offers his opinion that the work he performed was not an 

unnecessary duplication of the work performed by BCM or Gerngross. However, the majority of 

Sharpe’s time entries after the motion for substitution was granted indicate that he reviewed court 

filings such as orders, motions and briefs; reviewed other documents such as the jury instructions, 

interrogatories, discovery responses, and the offer of judgment; reviewed and replied to emails; and 

participated in telephone conferences. (Doc. 205-10, p. 1, 5-11) Nothing in the descriptions of the 

work performed indicates any distinct contribution by Sharpe but instead his work appears to be 

redundant of that performed by other counsel, specifically BCM. When awarding an attorney's fee, 

the “[c]ourts are not authorized to be generous with the money of others, and it is as much the duty 

of courts to see that excessive fees and expenses are not awarded as it is to see that an adequate 

amount is awarded.” Barnes, 168 F.3d at 428. Accordingly, the Commissioner’s request for an 

award of Sharpe’s attorney’s fees for work performed after the Commissioner was substituted as the 

plaintiff is denied.

However, Sharpe’s work performed on the motion for substitution is not redundant to the 

work performed by BCM.

7

 At that time, Sharpe and Gerngross represented the Commissioner. 

 7

 BCM filed a notice of appearance on behalf of the Commissioner on September 13, 2013 (docs. 

73,74). 

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15

Sharpe’s time entries indicate that he researched, drafted and briefed the motion for substitution, 

reviewed the responsive briefs, field a reply, communicated with opposing counsel, and maintained 

contact with Gerngross. Sharpe expended 19.1 hours. (Doc. 205-10, p. 2-4). By affidavit, Sharpe 

asserts that $175.00 is a reasonable hourly rate for his services under the particular circumstances of 

this action and that this rate is consistent with the prevailing market rate for an attorney in this 

district, with his experience, skill, and almost 30 years of general civil practice. 

The Court finds that Sharpe’s hourly rate of $175.00 is reasonable for an attorney of his 

skill, experience, reputation, and years of practice. The rate is in line with the rate customarily 

charged in this district for similar legal services. See Barnes, 168 F.3d at 437 (providing that “the 

‘relevant market’ for purposes of determining the reasonable hourly rate for an attorney's services is 

the place where the case is filed.” (citation omitted)).

The Court further finds that the work performed and the 19.1 hours expensed are reasonable. 

Sharpe was employed to represent the Commissioner in her motion for substitution, which 

contained an alternative motion to intervene (doc. 44, 49). Sharpe was successful in obtaining 

substitution for the Commissioner. Coltin opposed the motion for substitution unless certain 

conditions were met, but did not oppose the motion to intervene (doc. 50). Continental opposed the 

motion and filed a response, a supplemental response, and a second supplemental response. 

Continental argued primarily that the Commissioner should be substituted under Rule 17 instead of 

Rule 25(c) or Rule 24 (docs. 51, 56, 60; doc. 116, motion for reconsideration). The motion for 

substitution required review of several complex documents executed between ULLICO Casualty 

Company and Coltin as well as the Rehabilitation and Injunction Order wherein the Commissioner 

became the Receiver for ULLICO, and consideration of the complicated relationships between 

Continental and its insured Elkins Constructors, Inc., and between Coltin and ULLICO regarding 

several construction projects including the University of South Alabama project with Elkins. 

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16

In addition to consideration of the relevant criteria set forth by the Alabama courts, see 

Graddick, 453 So.2d at 1311 (explaining that “there would hardly ever be a case where the 

application of attorney's fees brought into play every criterion.”), the court may consider its own 

judgment in determining the reasonableness of requested fees. Beal Bank, SSB, 896 So. 2d at 404 (“

‘The trial court, in connection with a consideration of the opinion evidence proffered by qualified 

experts, may call to his aid his own estimate of the value of such legal services after considering the 

aforementioned elements . . .”and, generally speaking, the allowance rests within the sound judicial 

discretion of the trial court.’ ”); Loranger, 10 F.3d at 781. Accordingly, upon consideration of the 

relevant factors, the Commissioner’s request for an award of attorney’s fees in the amount of 

$3,342.508 for the work performed by Sharpe as to the motion for substitution is granted. 

(d) Whether the Commissioner is entitled to attorney’s fees incurred while Coltin was the 

plaintiff

Continental argues that the Commissioner is not entitled to any attorney’s fees incurred for 

work performed prior to BCM’s appearance as counsel for the Commissioner because those fees 

were for work performed for Coltin instead of the Commissioner. Continental argues that the 

Commissioner and Coltin pursued separate claims and actions on the payment bond and that only 

the Commissioner successfully pursued her action; therefore, the attorney’s fees requested for 

Emmanuel, Sheppard and Condon ($11,197.50) and for Faughnan Mendicino ($8,605.50) who 

represented Coltin before the Commissioner was substituted as the plaintiff, should not be awarded.

The Court finds Continental’s motion to be without merit. The Commissioner was substituted for 

Coltin as the plaintiff in this action. As such, the action continued unabated and the Commissioner 

pursued Coltin’s claims against the surety bond. 

i. Faughnan Mendicino, PLLC.

In support of her motion, the Commissioner submitted the affidavit of Fred A. Mendicino 

 8 The fee is calculated as follows: 19.1 hours x $175.00 = $3,342.50. 

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17

wherein he states that the firm of Faughnan Mendicino, PLLC, expended a total of 44.3 hours. In 

support of his requested hourly rate of $235.00, he states that he is admitted to practice in numerous 

state and federal courts; has practiced law since 1992 (approximately 22 years); that his firm has 

substantial experience in surety, construction and employment/education law; and he is head of the 

construction and surety practice (doc. 205-6). As previously stated, the Court, which is familiar 

with the prevailing rates in the local market, may also act as its own expert and rely on its 

knowledge and experience to determine the reasonableness and propriety of the requested fees. See 

Beal Bank, SSB, 896 So. 2d at 404; Loranger, 10 F.3d at 781. The Court finds that the $235.00 

hourly rate requested for Mendicino, an attorney with twenty-two years of practice and expertise in 

construction and surety practice is reasonable. 

Mendicino also offers his opinion that the same hourly rate should be awarded for the work 

performed by his partner James F. Faughnan. Mendicino did not provide the Court with any 

information as to the year of practice, skill, experience, or areas of expertise as to Faughnan. Thus, 

the Court is faced with an “indeterminate experience” situation for a partner. In such 

"indeterminate experiences” concerning law firm partners, this Court has awarded a rate of $225.00 

per hour. See, e.g., Wells Fargo Bank, N.A. v. Williamson, 2011 WL 382799, *4 (S.D. Ala. Feb. 3, 

2011). Therefore, the Court finds that an hourly rate of $225.00 is reasonable for Faughnan. 

Mendicino asserts that $185.00 is a reasonable hourly rate for the “other attorneys” who 

worked on the case: Thomas M. O’Connell, Wayne D. Garris, and Dylan M. Marck. (Doc. 205-6, p. 

2) However, there is no information in his affidavit as to their years of practice, experience, special 

skills, expertise, or other information from which the Court may determine a reasonable hourly rate 

for the work performed. In this district, the Court has awarded an hourly rate of $150.00 where the 

associates’ years of practice, experience, skill, and expertise were indeterminate. Vision Bank v. 

Anderson, 2011 WL 2142786 (S.D. Ala. May 31, 2011); SE Property Holdings, LLC v. 145, LLC, 

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18

2012 WL 6681784, 4 (S.D. Ala. Dec. 21, 2012) (awarding $150.00 per hour for associates where 

there was “no evidence of these associates’ expertise and experience”.) 

The Court next looks to the reasonableness of the hours expended by the firm. The invoice 

indicates that time was spent drafting the complaint; researching Alabama law; research and 

preparation of an agreement between ULLICO and Coltin; correspondence, discovery, privilege 

review of documents, reviewing pleadings, and research and preparing the answer to Continental’s 

counterclaim; research regarding assignments, real parties in interest, and indispensible parties;

9 and 

preparing the motion to withdraw (doc. 205-12). 

Mendicino invoiced a total of 7.60 hours for work performed. The Court finds that 5.60 

hours represents work and time that was reasonably incurred in furtherance of the claim against 

Continental. Mendicino finalized the complaint, communicated with counsel, and worked on the 

answer to the counterclaim and the report of parties’ planning meeting (doc. 205-12). However, 

the Court declines to award an attorney’s fee for the time spent preparing the motion to withdraw, 

2.00 hours, since this did not advance the claim. See Oden, 2013 WL 4046456, at *23 (disallowing 

time spent responding to an objection to the motion to withdraw as not for the plaintiff Oden’s 

benefit). Accordingly, the Commissioner’s request is granted in part and the Commissioner is 

awarded $1,316.00 for 5.60 hours of work performed by Mendicino at the hourly rate of $235.00. 

Faughnan invoiced a total of 1.60 hours for work performed. Faughnan reviewed 

Continental’s answer to Coltin’s discovery requests and drafted Coltin’s responses to Continental’s 

discovery. The Court finds that this work and time was reasonably incurred in furtherance of the 

claim and does not appear redundant to that of other attorneys in the firm. Accordingly, the 

Commissioner’s request is granted in part and the Commissioner is awarded $360.00 for 1.60 hours 

of work performed by Faughnan at the hourly rate of $225.00. 

 9

 Continental asserted a defense that Coltin had failed to join an indispensible party – Elkins 

Constructors, Inc., the general contractor. (Doc. 8, Answer and Counterclaim). 

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O’Connell invoiced a total of 21.8 hours for work performed. O’Connell prepared the 

complaint, researched causes of actions against sureties in Alabama, prepared an agreement, 

prepared written discovery, reviewed and prepared an answer to the counterclaim, attended the 

parties’ planning meeting, reviewed the proposed Rule 26 report, and communicated with other 

counsel. O’Connell also prepared his motion to withdraw and motions to appear pro hac for 

Mendicino and Faughnan. The Court finds that the majority of the work performed was reasonably 

incurred. However, the Court declines to award an attorney’s fee for the time spent preparing the 

motion to withdraw, 1.20 hours, since this did not advance the claim. See Oden, 2013 WL 

4046456, at *23. The Court also declines an award for the .40 hours spent preparing the motions to 

appear pro hac vice. The motions consist of two sentences and the attached applications are fill-inthe-blank forms. Thus, this appears largely a clerical task. The Court also declines an award for 

O’Connell’s time spent in conference, preparation, or review regarding the parties’ Rule 26(f) report

– 2.70 hours. Both Mendicino and O’Connell conferenced with opposing counsel and with local 

counsel in preparation of the parties’ Rule 26(f) report and Mendicino entered time for preparation 

of the draft for circulation. O’Connell’s time is redundant and does not indicate any distinct 

contribution on his part. Accordingly, the Commissioner’s request is granted in part and the 

Commissioner is awarded $2,625.00 for 17.5 hours of work performed by O’Connell at the hourly 

rate of $150.00. 

Marck invoiced a total of 5.40 hours for work performed. Marck primarily researched 

questions regarding sureties and contract and assignments and issues regarding the real party in 

interest and indispensible parties. The Court finds that the 5 hours spent on this research is 

reasonable. However, the Court declines an award for time spent preparing and organizing 

documents for substantive review - .40 hours. Garris’ time entries indicate that he conducted a 

privilege review of Coltin’s documents as part of preparing the documents for production. Thus, 

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20

Marck’s time is redundant to that of Garris and does not indicate a distinct contribution. 

Accordingly, the Commissioner’s request is granted in part and the Commissioner is awarded 

$750.00 for 5 hours of work performed by Marck at the hourly rate of $150.00.

Garris invoiced a total of 8.90 hours for work performed. He drafted objections and 

responses to the requests for production of documents, reviewed Coltin’s documents for privilege,10

and prepared the documents for production. However, Garris’ hours are reduced by 1.30 because 

these hours are redundant. Faughnan expended 1.30 hours to draft, edit and finalize objections and 

responses to requests for production of documents. The remainder of Garris’ time is compensable. 

Reviewing documents for privilege shows Garris’ distinct contribution to the litigation. 

Accordingly, the Commissioner’s request is granted in part and the Commissioner is awarded 

$1,140.00 for 7.60 hours of work performed by Garris at the hourly rate of $150.00.

In addition to consideration of the relevant criteria set forth by the Alabama courts, see 

Graddick, 453 So.2d at 1311 (explaining that “there would hardly ever be a case where the 

application of attorney's fees brought into play every criterion.”), the court may consider its own 

judgment in determining the reasonableness of requested fees. Beal Bank, SSB, 896 So. 2d at 404 (“

‘The trial court, in connection with a consideration of the opinion evidence proffered by qualified 

experts, may call to his aid his own estimate of the value of such legal services after considering the 

aforementioned elements . . .”and, generally speaking, the allowance rests within the sound judicial 

discretion of the trial court.’ ”); Loranger, 10 F.3d at 781. Accordingly, upon consideration of the 

relevant factors, and as set forth above, the Commissioner is awarded attorney’s fees in the total 

amount of $6,191.00 for the work performed by Faughnan Mendicino.

ii. Emmanuel Sheppard and Condon

In support of her motion, the Commissioner submitted the affidavits of Andrea Lyons and 

 10 The Court is aware of the volume of documents produced during discovery in this action. 

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21

H. Wesley Reeder, attorneys with Emmanuel Sheppard and Condon, which served as local counsel 

for Faughnan Mendicino. Both Reeder and Lyons state that they have attached an exhibit which 

contains descriptions of the time expended in connection with their representation. The Court has 

reviewed the Time Sheet provided by Emmanuel Sheppard (doc. 205-11). 

Lyons states that she spent 1.3 hours, billed at $155.00 to $175.00 hourly, and that $175.00 

is a reasonable hourly rate. Lyons is an associate with 6 years of practice who has worked in 

commercial litigation at Emmanuel Sheppard since 2010 (doc. 205-5, Lyons Affidavit). Lyons’ 

time entry for .50 hours on October 11, 2012, reads “Read Complaint. Review Answers by Ullico, 

Benchmark and Coltin. Receipt and review of e-mail from Tom [O’Connell]” (doc. 205-11, p. 5). 

However, this work does not appear related to this litigation. In another time entry that same day, 

Reeder entered: “Cursory review of complaint, draft answers in state court action, . . . review 

answers (x3) . . . preparation and filing of answers . . .” (Id.). Thus, it appears that the complaint 

and the three answers were filed in a state court action. In this court, Coltin filed the complaint and 

Ullico and Benchmark are not parties. Continental did file a counterclaim against Coltin on 

October 15, 2012, which Coltin answered on November 5, 2012; almost a month after Lyon’s time 

entry. Thus, it appears that Lyons was not referring to Coltin’s answer to Continental’s 

counterclaim. 

Lyons also entered a total of .40 hours for sending or receiving emails of unidentified 

content to or from the client and communicating with Mendicino’s office and locating documents 

they requested. The Court finds that this time is not compensable because the Court cannot 

ascertain what legal work was performed for Coltin in this action. Lyons also entered .40 hours on 

August 23, 2012, for “various intra-office emails regarding proceeding with suit. Discuss same 

with Wes Reeder. Work with Sherry regarding complaint” (doc. 205-11, p. 3). The complaint in 

this action was filed on August 22, 2012. Thus, this work appears related to this action. However, 

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22

the time spent is redundant to that of Reeder who communicated with O’Connell at Faughnan 

Mendicino and with paralegals in his own office regarding drafting and filing the complaint. 

Accordingly, the Commissioner is not entitled to an award for the work performed by Lyons and the 

request is denied.

Reeder states that he has spent a total of 34 hours in this action, billed at $250.00 to $285.00 

per hour during the time frame (he now bills $295.00), and asserts that $285.00 is a reasonable 

hourly rate (doc. 205-4). He has practiced in Florida since 2000 and since 2001, at Emmanuel 

Sheppard in construction law, civil litigation, and eminent domain (doc. 205-4). Reeder asserts that 

he is proficient in conflict of laws issues, which was a skill required in this action because of 

Continental’s attempt to assert the applicability of Florida law. (Id.) The Court finds that in this 

district, $225.00 per hour is a reasonable hourly rate for an attorney with his skill, experience, 

reputation, and years of practice who is serving as local counsel. The rate is in line with the rate 

customarily charged in this district for similar legal services. See Barnes, 168 F.3d at 437 

(providing that “the ‘relevant market’ for purposes of determining the reasonable hourly rate for an 

attorney's services is the place where the case is filed.” (citation omitted)).

Reeder’s time entries indicate that he primarily received and reviewed emails, pleadings, 

discovery, motions and responses, and other documents from Faughnan Mendicino, opposing 

counsel, and the court, and then communicated with his staff, Faughnan Mendicino, and opposing 

counsel in regard to same.11 Other than reviewing documents and emails, Reeder entered 4.60 

 11 For example, Reeder entered: “Receipt and review of court email re: Continental answer due 

date; email to attorney O’Connell, Sherry Ware re: Continental answer” (doc. 205-11, p. 5); 

“Receipt and review of Coltin’s answer to counterclaim; email to staff re: preparing answer to 

counterclaim for filing. . . . Conference with Sherry Ware re: filing answer to counterclaim; review 

answer to counterclaim’ review court email re: confirmation of filing answer to counterclaim. . . . 

Review email from Sherry Ware to O’Connell re: filing answer to counterclaim.” (Id., p. 6); 

“Review email from Tom O’Connell re: protective order: email to Nicole Ransom and attorney 

Staak re: filing protective order: review final protective order; conference with Nicole Ransom re: 

filing; review email from attorney Staak re: final approval of protective order.” (Id., p. 9); “Receipt 

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hours to communicate with counsel and staff to prepare for and schedule the parties’ planning 

meeting, participate in the meeting, review the draft report received from Mendicino, revise the 

report before filing, communicate with his staff regarding the revisions and filing the report. (Doc. 

205-11, p. 7) Reeder also documented time spent on the state court action (Id., p. 4). However, the 

descriptions indicate that Reeder’s work was redundant to that of Faughnan Mendicino and not a 

distinct contribution. Accordingly, the Commissioner is not entitled to an award for the work 

performed by Reeder and the request is denied. 

The Commissioner also seeks an award for the work performed by the paralegals at 

Emmanuel Sheppard. Reeder states that his paralegals worked 18.6 hours on this matter at a rate 

between $90 and $115.00 an hour (doc. 205-4). Reeder does not indicate the names of the 

paralegals, but Sherry Ware and Nicole Ransom are specifically mentioned in Reeder’s time entries 

and they appear to have recorded time entries (doc. 205-11). However, as with Reeder, the bulk of 

the paralegal time entries do not indicate any distinct contribution to the action but instead again 

consist of receiving and reviewing emails, documents, and pleadings; frequently mirroring the time 

entries by Reeder.12 Also, several entries indicate clerical work as opposed to work customarily 

performed by an attorney. Johnson v. TMI Management Systems, Inc., 2012 WL 4435304, *5-6 

(S.D. Ala., Sept. 26, 2012) (“The law is quite clear that ‘purely clerical or secretarial tasks should 

 

and review of memo in opposition to motion to intervene; phone call with attorney Garris re: 

revision to opposition; receipt and review of email from attorney Garris re bond; conference with 

Sherry Ware re: revision to opposition memo.” (Id. p 11). 

12 For example, on September 24, 2012, Reeder recorded “Review email confirming service on 

Continental” and Ransom recorded “E-mail regarding service of Continental Casualty.” (Doc. 205-

11, p. 4) On February 20, 2013, Reeder recorded “Receipt and review of Coltin’s objections to 

Continental’s first request for production” and the day before, Ransom recorded “Receipt and 

review of discovery document: Coltin’s responses to Continental’s first request for production.” 

(Id., p. 13) On March 19, 2013, Reeder recorded “Receipt and review of order re: motion to 

intervene” and Ransom recorded “Receipt and review of Court Document: Order denying motion to 

intervene by Elkins.” (Id., p. 14) 

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not be billed at a paralegal rate, regardless of who performs them.’”) (quoting Missouri v. Jenkins ex 

rel. Agyei, 491 U.S. 274, 288 n. 10, 109 S.Ct. 2463 (1989)).13 Accordingly, the Commissioner is 

not entitled to an award for the work performed by the paralegals at Emmanuel Sheppard and the 

request is denied. 

Additionally, if the Court were inclined to an award, the requested hourly rate of $110.00 

per hour for the paralegal work is not reasonable in this district. Reeder identifies the paralegal as a 

“certified paralegal” (doc. 205-4). However, absent a showing that a paralegal possesses some 

extraordinary qualification or expertise, this Court has routinely found a rate of $75.00 was 

reasonable for work by paralegals. See Oden v. Vilsack, 2013 WL 4046456, at *7 (S.D. Ala. Aug. 

9, 2013); SE Prop. Holdings, LLC v. 145, LLC, 2012 WL 6681784, at *4 (S.D. Ala. Dec. 21, 2012); 

Johnson v. TMI Mgmt. Systems, Inc., 2012 WL 4435304, at *4 (S.D. Ala. Sept. 26, 2012). 

3. Costs and expenses

The Commissioner seeks an award of $47,802.14 for expenses and costs incurred by BCM, 

$4,690.70 for expenses and costs incurred by Black & Gerngross, and $580.62 for expenses and 

costs incurred by Emmanuel Sheppard and Condon (docs. 195, 205). 

(a) Costs

Continental argues that the Commissioner is not entitled to recover litigation costs because 

the statute, Ala. Code § 39-1-1(b) does not provide for recovery of costs but instead is specifically 

limited to an award of attorney’s fees. Continental compares this statute with Ala. Code § 39-1-

1(d) which specifically provides for attorney’s fees and costs. Continental also argues that Local 

Rule 54.1 requires the Commissioner as the prevailing party, to file a verified bill of costs within 

fifteen days of the date of the judgment or other final order and that failure to comply constitutes a 

 13 For example, notifying the attorneys and other paralegals of forthcoming deadlines, conferences 

with the court clerk regarding electronic filing, contacting the private process server, calendaring, 

telephone conferences

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waiver of costs. Continental asserts that the Commissioner did not file a verified bill of costs and 

therefore, has waived her claim for costs. 

Rule 54(d)(1) of the Federal Rules of Civil Procedure states as follows:

(1) Costs Other Than Attorney's Fees. Unless a federal statute, these rules, or a 

court order provides otherwise, costs--other than attorney's fees--should be 

allowed to the prevailing party.

Fed. R. Civ. P. 54(d)(1). Local Rule 54.1 provides for taxation of costs by the Clerk. The local rule 

states that a “prevailing party who desires to tax costs must file with the court, within fifteen days of 

the date of the judgment or other final order ... a verified bill of costs” and upon receipt, the Clerk 

should tax costs in conformity with 28 U.S.C. §§ 1920,14 1921,15 and 1923 (certain docket fees in 

civil actions and costs of briefs for admiralty appeals) and other provisions of law that may apply. 

S.D. Ala. L.R. 54.1(a) & (b). 

Local Rule 54.1(d) also states that “[f]ailure to comply with the time limitations of this Rule 

shall constitute a waiver of costs, unless otherwise ordered by the court.” S.D. Ala. L.R. 54.1(d). 

The Court declines to order otherwise or to relieve the Commissioner of this waiver. Therefore, to 

the extent that the Commissioner seeks costs pursuant to the statute or under Rule 54(d)(1), the 

request is denied because the Commissioner did not file a verified bill of costs within the fifteenday time frame. 

 14 “A judge or clerk of any court of the United States may tax as costs the following: (1) Fees of the 

clerk and marshal; (2) Fees for printed or electronically recorded transcripts necessarily obtained for 

use in the case; (3) Fees and disbursements for printing and witnesses; (4) Fees for exemplification 

and the costs of making copies of any materials where the copies are necessarily obtained for use in 

the case; (5) Docket fees under section 1923 of this title; (6) Compensation of court appointed 

experts, compensation of interpreters, and salaries, fees, expenses, and costs of special interpretation 

services under section 1828 of this title.” 28 U.S.C. § 1920.

15 The fees that the United States’ marshals or deputies routinely collect for serving writs, serving 

subpoenas or summons for witnesses, for maritime or civil executions, seizures or attachments, 

copies, travel expenses, and overtime. 28 US.C. § 1921. 

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(b) Expenses

The Commissioner’s motion for award of statutory attorney’s fees includes a request for 

litigation expenses (docs. 195, 205). In support of the expenses incurred, she provides copies of the 

invoices from the respective law firms, declarations of counsel, and as to BCM, the declarations of 

local attorneys Copeland and Vaughan16 (docs. 205-1 through 14). 

Continental argues that the Commissioner is not entitled to an award for expenses because 

the statute, Ala. Code § 39-1-1(b), does not provide for recovery of expenses, but instead is 

specifically limited to an award of attorney’s fees. Continental compares this statute with Ala. Code 

§ 39-1-1(d) which specifically provides for recovery of an attorney’s fees and costs, but also does 

not provide for expenses.

As to related nontaxable expenses, Rule 54(d)(2) provides in relevant part as follows:

(A) Claim to Be by Motion. A claim for attorney's fees and related nontaxable 

expenses must be made by motion unless the substantive law requires those fees 

to be proved at trial as an element of damages. 

(B) Timing and Contents of the Motion. Unless a statute or a court order provides 

otherwise, the motion must: . . . 

(ii) specify the judgment and the statute, rule, or other grounds entitling the 

movant to the award;

(iii) state the amount sought or provide a fair estimate of it [.]

Fed. R. Civ. P. 54(d)(2)(A) & (B). 

Local Rule 54.3 provides that if the final judgment “does not determine (or establish other 

procedures for determining) the propriety of the amount of attorney’s fees authorized by statute or 

the equitable or inherent powers of the court . . . [t]he award of such fees (and expenses incident 

thereto not ordinarily allowable as taxable costs) shall be requested by special written motion 

 16 Vaughan stated that he had reviewed the expenses incurred by BCM and “[b]ased upon the 

discovery conducted, retained expert, legal research services, and trial time”, it was his opinion that 

the expenses claimed were fair and reasonable. (Doc. 205-14) 

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addressed to the court, and shall not be included in a cost bill or motion for taxation of costs[.]” S.D. 

Ala. L.R. 54.3(a). “[E]xpense includes all the expenditures actually made by a litigant in 

connection with the lawsuit.” Eagle Insurance Co. v. Johnson, 982 F. Supp 1456, 1458 

(M.D.Ala.1997) (citations omitted). On the other hand, “costs that the district court may award 

under Rule 54(d)(1) are listed in 28 U.S.C.A. § 1920, and a district court may not award other costs 

or exceed the amounts provided in § 1920 without explicit authorization in another statutory 

provision.” Id. (citations omitted). 

The Commissioner has moved for expenses not ordinarily taxed as costs. Her itemization 

includes travel and meal expenses for attorneys, expenses related to expert witnesses,17 and the 

expenses of electronic legal research which are ordinarily not taxed as costs. The statute upon 

which the Commissioner relies, Ala. Code §39-1-1(b), provides in relevant part, as follows: 

(b) . . . In the event the surety or contractor fails to pay the claim in full within 

45 days from the mailing of the notice, then the person or persons may recover 

from the contractor and surety, in addition to the amount of the claim, a 

reasonable attorney's fee based on the result, together with interest on the claim 

from the date of the notice.

Ala. Code § 39-1-1(b). However, the statute is silent as to expenses. 

“It is well settled that federal courts are bound by the interpretation of a state statute by state 

courts.” Insurance Company of North America v. Lexow, 937 F.2d 569, 571 (11th Cir.1991); 

National Union Fire Ins. Co. v. Cavins, 226 Fed Appx. 895, 899 (11th Cir. 2007). The Court has 

not found an Alabama appellate court decision interpreting this statute to authorize an award of 

litigation expenses as part of an award of a reasonable attorneys’ fee. In White-Spunner Const., 

Inc. v. Construction Completion Co., LLC, 103 So.3d 781 (Ala. 2012), the trial court entered 

summary judgment in favor of sub-contractor Construction Completion and against general 

 17 Under 28 U.S.C. § 1920(3), “[f]ees and disbursements for . . . witnesses” is considered a cost 

when the expert appears at trial. But, in that context, the costs are limited by 28 U.S.C. § 1821 

which authorizes reimbursement for travel expenses and the $40.00 per diem. 

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contractor White-Spunner and its surety Hartford Fire Insurance Company. The trial court also 

found that White-Spunner was liable for Construction Completion’s expenses, but not the surety 

Hartford, “because § 39–1–1 contained no provision for recovering expenses from a surety.” Id. at 

786. White-Spunner and Hartford appealed. 

The Alabama Supreme Court reversed and remanded the trial court’s decision upon finding 

that Construction Completion had illegally contracted with Buena Vista Construction, LLC, which 

was not properly licensed to do business in Alabama. White-Spunner and Hartford argued that 

Construction Completion was effectively suing them to recover money due as a result of work 

performed by its sub-subcontractor Buena Vista, but because Buena Vista was an unlicensed 

contractor, its contract with Construction Completion was illegal and void, and therefore, 

Construction Completion could not prevail on its claim against White-Spunner and Hartford. 

The Alabama Supreme Court found that Construction Completion’s contract with Buena 

Vista was illegal and therefore it could not maintain a cause of action against White-Spunner and 

Hartford because it relied in whole or in part upon an illegal transaction to which Construction 

Completion was a party. Id. at 794. The Court reversed and remanded the case for further 

proceedings consistent with the decision. However, the Court did not address or find unsupported 

the trial court’s decision that Construction Completion could not recover expenses against the surety 

Hartford because there was no provision for same in the statute, Ala. Code 39-1-1(b). 

In Hartford Acc. & Indemnity Co. v. Cochran Plastering Co., Inc., the appellate court 

addressed only Cochran Plastering’s claim for an attorney’s fee. The appellate court cited Ex parte 

Klinefelter, Halsey, Jones & Cater, P.C., 674 So.2d 1287, 1290 (Ala.1995) for the premise that “ 

‘In Alabama and most other jurisdictions, the general rule is that attorney's fees and expenses of 

litigation are not recoverable as damages, in [the] absence of a contractual or statutory duty, other 

than [by] a few recognized ... equity principles.’ ” 935 So. 2d at 472 (citation omitted). And then 

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explained “[i]n this case, § 39–1–1(b), Ala. Code 1975, provides that in an action against a surety 

for a company that has entered into a contract with a subdivision of the state, the party suing may 

seek ‘in addition to the amount of the claim, a reasonable attorney's fee based on the result, together 

with interest on the claim from the date of the notice.’” Id. 

The appellate court then addressed Cochran Plastering’s claim for attorney’s fees without mention 

of expenses or costs, and relying upon the attorney’s description of the hours expended and the 

work performed. Id. at 474.

Based upon the limited cases that discuss or address Ala. Code § 39-1-1(b), the Court finds 

that the Commissioner is not entitled to expenses because there is no statutory provision for 

recovery of expenses as part of a reasonable attorney’s fees. Additionally, the Commissioner has 

not provided any argument that any “contract” or “special equity” exists that could form the basis 

for an award of expenses. See Jones v. Regions Bank, 25 So.3d at 441. Accordingly, the 

Commissioner’s request for an award of litigation expenses is denied. 

C. Conclusion

Previously, the Court reserved jurisdiction to address the Commissioner’s claim for interest 

and reasonable attorneys’ fees pursuant to Ala. Code § 39-1-1(b) (doc. 190). The Court determined 

that the Commissioner was entitled to pre-judgment interest in the amount of $19,405.48 (doc. 208). 

The Court now awards $ 110,124.13 as a reasonable attorney’s fee. Therefore, an amended final 

judgment shall be entered by separate document.

DONE and ORDERED this the 15th day of January 2015.

 

/s/ Kristi K. DuBose

KRISTI K. DuBOSE

UNITED STATES DISTRICT JUDGE

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