Court Opinion

ID: 9931607
Source: CourtListenerOpinion
Date Created: 2024-02-09 16:01:18.620538+00
Date Added: 2024-06-11T12:24:29.846794
License: Public Domain

United States Court of Appeals
                          For the Eighth Circuit
                      ___________________________

                              No. 21-1795
                      ___________________________

                      Jet Midwest International Co., Ltd

                      lllllllllllllllllllllPlaintiff - Appellee

                                         v.

             Jet Midwest Group, LLC; Paul Kraus; Karen Kraus

                           lllllllllllllllllllllDefendants

F. Paul Ohadi, in his capacity as trustee and legal representative of the F. Paul
Ohadi Trust dated December 15, 1999 and in his individual capacity; F. Paul
        Ohadi Trust, dated December 15, 1999; Kenneth M. Woolley

                    lllllllllllllllllllllDefendants - Appellants

                                 Jet Midwest Inc.

                           lllllllllllllllllllllDefendant

                 KMW Business Jets; Alta Airlines Holdings

                    lllllllllllllllllllllDefendants - Appellants
                        ___________________________

                              No. 21-1858
                      ___________________________

                      Jet Midwest International Co., Ltd

                      lllllllllllllllllllllPlaintiff - Appellant
                                          v.

               Jet Midwest Group, LLC; Paul Kraus; Karen Kraus

                            lllllllllllllllllllllDefendants

  F. Paul Ohadi, in his capacity as trustee and legal representative of the F. Paul
  Ohadi Trust dated December 15, 1999 and in his individual capacity; F. Paul
          Ohadi Trust, dated December 15, 1999; Kenneth M. Woolley

                      lllllllllllllllllllllDefendants - Appellees

                                  Jet Midwest Inc.

                             lllllllllllllllllllllDefendant

             KMW Business Jets, LLC; Alta Airlines Holdings, LLC

                      lllllllllllllllllllllDefendants - Appellees
                                       ____________

                    Appeals from United States District Court
                 for the Western District of Missouri - St. Joseph
                                 ____________

                          Submitted: September 20, 2023
                             Filed: February 9, 2024
                                 ____________

Before SMITH, Chief Judge, MELLOY and ERICKSON, Circuit Judges.
                             ____________

SMITH, Chief Judge.

                                          -2-
        F. Paul Ohadi, in his capacity as trustee and legal representative of the F. Paul
Ohadi Trust dated December 15, 1999, and in his individual capacity; the F. Paul
Ohadi Trust, dated December 15, 1999; Kenneth M. Woolley; KMW Business Jets,
LLC; and Alta Airlines Holdings, LLC (collectively, “Ohadi/Woolley defendants”)
appeal the district court’s order awarding attorneys’ fees to Jet Midwest International
Co., Ltd. (Jet Midwest International) in the amount of $6,565,297.19, plus contractual
interest of 14 percent accruing on the date of each invoice at issue. Jet Midwest
International cross-appeals, arguing that the district court erred in not awarding all
of its requested fees and costs pursuant to a contractual fee-shifting provision. We
vacate the award of attorneys’ fees and costs and remand for further proceedings
consistent with this opinion.

                                   I. Background
     In September 2015, Jet Midwest International and Jet Midwest Group, LLC
(JMG) entered into a Term Loan Agreement for Jet Midwest International to loan
JMG $6.5 million to fund its acquisition of a Boeing 737-700 aircraft. The Term Loan
Agreement contained the following fee-shifting provision:

        Borrower [JMG] agrees to pay on demand all costs and expenses in
        connection with the preparation, execution, delivery, filing, recording,
        and administration of any of the Loan Documents, including the
        reasonable fees and out-of-pocket expenses of counsel for Lender [Jet
        Midwest International], with respect to the items noted above and with
        respect to advising Lender as to its rights and responsibilities under any
        of the Loan Documents; provided, however, that Borrower’s payment
        obligations in this sentence shall not exceed, and shall be capped at,
        $20,000. Borrower agrees to pay on demand all costs and expenses, if
        any, in connection with the enforcement of any of the Loan Documents.

Jet Midwest Int’l Co. v. Jet Midwest Grp., LLC, 932 F.3d 1102, 1105–06 (8th Cir.
2019).1

        1
            “Hong Kong law governs the interpretation of the loan agreement.” Id. at
1106.
                                           -3-
       The Term Loan Agreement required JMG to repay the loan within one year.
But JMG never repaid any of the principal on the loan. As a result, Jet Midwest
International filed the Term Loan Action against JMG. See Jet Midwest Int’l Co. v.
Jet Midwest Grp., LLC, No. 5:17-cv-06005-FJG (W.D. Mo.). The district court
granted summary judgment in favor of Jet Midwest International, concluding that
JMG had failed to repay the principal balance of the loan and had failed to pay
interest in accordance with the Term Loan Agreement.

       Shortly thereafter, Jet Midwest International moved for an order requiring JMG
to reimburse Jet Midwest International for attorneys’ fees incurred in the Term Loan
Action. Although the district court denied the motion, this court reversed on appeal.
We concluded that the Term Loan Agreement’s “use of the sweeping language ‘all
costs and expenses’ reflects the parties’ intent that JMG would pay Jet Midwest
International’s attorneys’ fees and other costs for enforcing as well as preparing the
agreement.” Jet Midwest Int’l, 932 F.3d at 1106. Thus, Jet Midwest International was
entitled to “all” attorneys’ fees incurred in “enforcing” the Term Loan Agreement. Id.
We remanded to the district court “for consideration of an appropriate award.” Id. at
1107. The district court subsequently awarded Jet Midwest International attorneys’
fees in the amount of $823,341.04, plus contractual interest of 14 percent accruing
on the date of each invoice at issue.

      After the district court awarded summary judgment in the Term Loan Action,
Jet Midwest International attempted to collect on the judgment by garnishing JMG’s
bank accounts, but JMG had no remaining funds to collect. Jet Midwest International
then filed the instant Fraudulent Transfer Action under the Missouri Uniform
Fraudulent Transfer Act (MUFTA). It alleged that JMG refused to pay the judgment
in the Term Loan Action and had fraudulently transferred its assets to the
Ohadi/Woolley defendants. The district court conducted a bench trial and entered
judgment in Jet Midwest International’s favor on all of its causes of action. The

                                         -4-
actions included the following: (1) a cause of action against JMG as the transferor
pursuant to the MUFTA (Count I); (2) a cause of action against the Ohadi/Woolley
defendants as the transferees under the MUFTA (Count II); (3) a cause of action
against all defendants for civil conspiracy (Count III); and a cause of action for
declaratory judgment against the Ohadi Trust (Count IV). Ultimately, the district
court determined that JMG fraudulently transferred cash and share certificates valued
at $41,054,949.67. The district court ordered as follows:

      [M]onetary damages are awarded, jointly and severally, against Kenneth
      M. Woolley, the Ohadi Trust, and F. Paul Ohadi in his capacity as
      trustee and legal representative of the Ohadi Trust and in his individual
      capacity, in the following amount:

             (a) $6,500,000.00; plus,

             (b) $75,833.37 in interest that was due but unpaid as of
             October 26, 2017; plus,

             (c) $2,090,326.37 in additional unpaid interest accruing
             through May 31, 2019; plus,

             (d) additional interest at a rate of 14% per annum from
             June 1, 2019 until this award of monetary damages is
             satisfied; plus,

             (e) such additional amounts as may be awarded to Jet
             Midwest International in fees and costs in Case No.
             17-cv-06005.

      But the sum of (a) through (e), above, shall not exceed a maximum total
      monetary damages award of $41,054,949.67.

R. Doc. 700, at 2 (emphases added).

                                         -5-
       After entry of judgment in the Fraudulent Transfer Action, Jet Midwest
International sought reimbursement of its fees and costs. It requested attorneys’ fees
and costs in the amount of $8,753,729.59 at an interest rate of 14 percent from the
date of each invoice until the award is paid.2 It argued that it was entitled to such fees
pursuant to the district court’s order entering judgment in favor of Jet Midwest
International and this court’s opinion in Jet Midwest International, 932 F.3d 1102.
The Ohadi/Woolley defendants opposed the motion, arguing that “they were not a
party to the Term Loan [A]greement and that [the] Eighth Circuit Order states that
[Jet Midwest International] shall recover [its] fees against JMG.” Jet Midwest Int’l
Co., 2021 WL 1397224, at *2. The district court, however, concluded that the
Ohadi/Woolley defendants were jointly and severally liable for fees and costs based
on its prior holding that the Ohadi/Woolley defendants “violated the [MUFTA] and
colluded and conspired with each other in doing so.” Id. (citing Trimble v. Pracna,
51 S.W.3d 481, 500 (Mo. Ct. App. 2001) (“A civil conspiracy is an agreement or
understanding between two or more persons to do an unlawful act or use unlawful
means to do an otherwise lawful act.”)).

       After determining that Jet Midwest International was entitled to a fee award,
the court addressed the reasonableness of the fee request of $8,753,729.59. Jet
Midwest International justified its fee request based on the length of the litigation
(two years); the number of defendants (nine prior to bifurcation); “the extraordinary
complexity of the fraudulent scheme engaged in by defendants”; and “the nature of
the services [counsel] provided, the importance and amount of money involved, the
degree of responsibility, [and the] skill and result achieved.” Id. at *3. It supported

      2
        “Jet Midwest International note[d] that the lodestar approach produced a
slighter higher attorney fee amount ($8,819,216.43), but that [was] due to a 10%
discount and certain other discounts applied to some invoices.” Jet Midwest Int’l Co.
v. Jet Midwest Grp., LLC, No. 5:18-cv-06019-FJG, 2021 WL 1397224, at *2 (W.D.
Mo. Mar. 30, 2021).Before the district court, Jet Midwest International “only [sought]
the lower, discounted amount that was actually invoiced.” Id.
                                           -6-
its fee request with two declarations; “numerous attached exhibits detailing the
attorneys who worked on the case, a summary of their backgrounds and what work
they performed on this case”; and “a lodestar chart detailing the names of all the
timekeepers, the dates they worked on the case, their position, their actual hourly rate,
the total hours worked and the total fees for each timekeeper.” Id. “Of the total [fee]
amount, $1,117,791.24 was for costs incurred in connection with the retention of
three expert witnesses . . . . [and] $364,748.32 was attributable to other third-party
costs, including printing, legal research and court reporting services.” Id. And its “fee
request represent[ed] 13,338.51 hours billed by a total of 53 timekeepers,” with four
attorneys primarily working on the case. Id.

       The Ohadi/Woolley defendants opposed the fee request. First, they argued that
“Jet Midwest International is only entitled to recover fees from the date judgment is
entered and only at the Federal Funds rate, plus 5%.” Id. at *5. Second, they asserted
that Jet Midwest International’s “attorneys engaged in block billing and provided
vague descriptions” for work performed. Id. Third, they maintained that counsel for
Jet Midwest International “failed to delegate assignments appropriately and
wrongfully billed for administrative tasks.” Id. With regard to costs, the
Ohadi/Woolley defendants argued that Jet Midwest International “included items
which are unrecoverable, such as legal research, document processing and beverage
service” and requested travel costs that “are excessive and duplicative—such as
charging for multiple attorneys attending the same depositions and hearings.” Id.
They also argued that Jet Midwest International’s “expert witness fees are not taxable
and instead experts are taxed at the same rate as any other witness and entitled to
$40/day plus actual expenses.” Id.

       In determining the attorneys’ fee award, the district court did not calculate the
fees using the lodestar method; instead, it began its analysis by considering seven
factors:

                                          -7-
      (1) the time expended, (2) the nature, character and amount of the
      services rendered, (3) the nature and importance of the litigation, (4) the
      degree of responsibility imposed on the attorney, (5) the amount of
      money involved, (6) the degree of professional ability, skill, and
      experience called for and used; and (7) the result obtained.

Id. at *6 (quoting Dinosaur Merch. Bank Ltd. v. Bancservices Int’l LLC, No. 1:19-cv-
84-ACL, 2020 WL 3489344 (E.D. Mo. June 26, 2020) (quoting Weitz Co. v. MH
Wash., 631 F.3d 510, 528–29 (8th Cir. 2011))). Applying these factors, the district
court found that Jet Midwest International was entitled to “a large fee request” “in
light of the enormous amount of time expended, the extraordinarily complex nature
of the financial transactions at issue, the sheer volume of documents and discovery
that the parties engaged in and the amount of fraudulent transfers recovered.” Id. But
the court found that “some hours submitted . . . were ‘excessive, redundant or
otherwise unnecessary’ and that there was some amount of ‘overlawyering’
involved.” Id. (quoting Dinosaur Merch. Bank, 2020 WL 3489344, at *7). The court
declined to “wade through the numerous pages of billing records submitted or attempt
a line-by-line adjustment to either the specific tasks billed or the hours charged”;
instead, it “exercise[d] its discretion and ma[d]e a percentage reduction.” Id. It
reduced the amount of fees by 25 percent, resulting in a total fee award of
$6,565,297.19.

                                      II. Discussion
       On appeal, the Ohadi/Woolley defendants argue that the district court erred in
awarding attorneys’ fees and costs against them because they were not parties to the
Term Loan Agreement; as a result, they contend they are not liable to Jet Midwest
International for attorneys’ fees and costs under the fee-shifting provision of the Term
Loan Agreement. They assert that the district court “conflated liability in the Term
Loan Action with liability in the MUFTA Action.” Appellants’ Br. at 8. The
Ohadi/Woolley defendants additionally argue that, in calculating the fee award, the
district court “failed to apply the correct legal standard and conducted no meaningful

                                          -8-
analysis of the reasonableness of fees or the taxability of costs” that Jet Midwest
International requested. Id. They maintain that the district court “abused its discretion
in awarding . . . $6,565,297.19 in conflated attorneys’ fees and costs in connection
with an action to collect the Term Loan Judgment arising from a $6.5 million loan.”
Id. They further argue that the district court “erroneously assessed the factors relevant
to an award of fees” and ignored “thousands of hours of excessive, redundant, or
otherwise unnecessary hours billed and egregious overstaffing” in calculating the fees
and costs owed to Jet Midwest International. Id.

       Jet Midwest International cross-appeals, arguing that the district court
erroneously granted it “less than the total fees requested.” Appellee’s Br. at 56.
Specifically, it argues that the district court erred by applying “statutory fee-shifting
standards” instead of the fee-shifting provision of the Term Loan Agreement to
calculate the fee award. Id. Alternatively, it argues that even if the statutory standard
is appropriate, it was still entitled to all of its fees because it prevailed on all causes
of action and “prov[ed] that all fees were paid and were caused by [the Ohadi
defendants’] fraud[] and litigation misconduct.” Id.

        “We review de novo the legal issues related to an award of attorneys’ fees,
while the actual award is reviewed for an abuse of discretion.” Blackorby v. BNSF Ry.
Co., 60 F.4th 415, 420 (8th Cir. 2023) (internal quotation marks omitted). We review
for an abuse of discretion a district court’s award of costs. Marmo v. Tyson Fresh
Meats, Inc., 457 F.3d 748, 762 (8th Cir. 2006). A district court abuses its discretion
by awarding costs that are not taxable under 28 U.S.C. § 1920. Johnson Tr. of
Operating Eng’rs Loc. #49 Health & Welfare Fund v. Charps Welding &
Fabricating, Inc., 950 F.3d 510, 527 (8th Cir. 2020); see also Crawford Fitting Co.
v. J.T. Gibbons, Inc., 482 U.S. 437, 444–45 (1987) (holding district courts are “bound
by the limitations” established by § 1920 and that costs not enumerated under that
section are not taxable). “A district court abuses its discretion if it bases its ruling on

                                           -9-
a clearly erroneous assessment of the evidence or an erroneous view of the law.”
Kezhaya v. City of Belle Plaine, 78 F.4th 1045, 1049 (8th Cir. 2023).

                         A. Entitlement to Attorneys’ Fees3
       Federal Rule of Civil Procedure 54(d)(2) provides that a party seeking
attorneys’ fees must “specify the judgment and the statute, rule, or other grounds
entitling the movant to the award.” Fed. R. Civ. P. 54(d)(2)(B)(ii). In this diversity
case, “Missouri substantive law governs whether attorney’s fees are available.” S&H
Farm Supply, Inc. v. Bad Boy, Inc., 25 F.4th 541, 554 (8th Cir. 2022) (quoting Jo Ann
Howard & Assocs., P.C. v. Nat’l City Bank, 11 F.4th 876, 887 (8th Cir. 2021)). “In
awarding attorney’s fees, Missouri follows the American Rule, which requires parties
to pay their own attorney fees unless their contract or a statute authorizes otherwise.”
Id. (emphasis added).

      3
         In its amended judgment finding liability on all of Jet Midwest International’s
claims, the district court awarded “monetary damages . . . , jointly and severally,
against Kenneth M. Woolley, the Ohadi Trust, and F. Paul Ohadi in his capacity as
trustee and legal representative of the Ohadi Trust and in his individual capacity, in
. . . such additional amounts as may be awarded to Jet Midwest International in fees
and costs in Case No. 17-cv-06005.” R. Doc. 700, at 2 (emphasis added). The
Ohadi/Woolley defendants never challenged on appeal the district court’s award of
such “fees and costs” in that amended judgment. Their failure to challenge this award
ends the issue as to whether Jet Midwest International will receive an award of “fees
and costs.” But the district court did not articulate its basis for the award of fees and
costs in the amended judgment; instead, it articulated a basis for the award when it
entered its order on Jet Midwest International’s motion for fees and costs. In its cross-
appeal, Jet Midwest International argues that the district court “erred as a matter of
law by applying a statutory fee-shifting framework rather than a contractual fee-
shifting framework.” Appellee’s Br. at 58. Thus, we must address under what basis
Jet Midwest International is entitled to an award of “fees and costs.”

                                          -10-
                     1. Contractual Entitlement to Attorneys’ Fees
       Jet Midwest International contends that it is contractually entitled to attorneys’
fees and costs under the fee-shifting provision of the Term Loan Agreement that it
entered into with JMG. It reasons that the Ohadi/Woolley defendants “are jointly and
severally liable for [JMG’s] contractual obligation because they conspired with JMG
to defraud [Jet Midwest International] and to breach the Term Loan Agreement by
fraudulently transferring to themselves the money belonging to [Jet Midwest
International].” Appellee’s Reply Br. at 1. We disagree.

       In the Term Loan Agreement, “JMG agree[d] to pay Jet Midwest International
‘all costs and expenses’ for both preparing and enforcing the loan agreement.” Jet
Midwest Int’l, 932 F.3d at 1106 (emphases added). “The use of the sweeping
language ‘all costs and expenses’ reflects the parties’ intent that JMG would pay Jet
Midwest International’s attorneys’ fees and other costs for enforcing as well as
preparing the agreement.” Id. (second, third, and fourth emphases added).

       As the district court found—and the Ohadi/Woolley defendants concede—“Jet
Midwest International brought this [Fraudulent Transfer Action] and the costs
associated with it to enforce its own judgment in the Term Loan Action.” Jet Midwest
Int’l Co., 2021 WL 1397224, at *5; Appellants’ Br. at 36 (quoting Jet Midwest Int’l
Co., 2021 WL 1397224, at *5). Under “the sweeping phrase ‘all costs and expenses,’”
Jet Midwest Int’l, 932 F.3d at 1107, Jet Midwest International would be entitled to
attorneys’ fees from JMG based on the contract’s governing language. Cf. Residential
Funding Co. v. Terrace Mortg. Co., 725 F.3d 910, 922 (8th Cir. 2013) (holding the
district court correctly relied on contractual language providing for fees “without
limitation”).

     But the Ohadi/Woolley defendants were not a party to the Term Loan
Agreement; therefore, they were not bound by that agreement. As a result, no

                                          -11-
contractual provision authorizes an award of attorneys’ fees against the
Ohadi/Woolley defendants in this Fraudulent Transfer Action.

       Nonetheless, Jet Midwest International argues, among other things, that “[a]
court may impose joint and several liability in setting [attorneys’] fees.” Appellee’s
Br. at 76 (quoting Walker v. U.S. Dep’t of Hous. & Urb. Dev., 99 F.3d 761, 772 (5th
Cir. 1996)); see also Concord Boat Corp. v. Brunswick Corp., 309 F.3d 494, 497 (8th
Cir. 2002) (citing Walker with approval). Although this may be true, there must still
be an underlying statutory or contractual basis justifying the award of attorneys’ fees
in the first instance. Here, the Term Loan Agreement does not provide a basis upon
which to jointly and severally award attorneys’ fees against the Ohadi/Woolley
defendants in the Fraudulent Transfer Action.

                       2. Statutory Entitlement to Attorneys’ Fees
        Because no contractual basis exists to justify an award of attorneys’ fees
against the Ohadi/Woolley defendants in this Fraudulent Transfer Action, we address
whether a statutory basis exists. See S&H Farm Supply, Inc., 25 F.4th at 554. The
district court concluded that the Ohadi/Woolley defendants were jointly and severally
liable for attorneys’ fees because they conspired and colluded with JMG to violate the
MUFTA. See Jet Midwest Int’l Co., 2021 WL 1397224, at *2 (citing Trimble, 51
S.W.3d at 500).

      “Courts adhere to state common law rules when assessing the availability of
attorney’s fees under the [M]UFTA.” Volk Constr. Co. v. Wilmescherr Drusch
Roofing Co., 58 S.W.3d 897, 901 (Mo. Ct. App. 2001). As explained supra, in the
absence of a contractual agreement, Missouri requires statutory authorization to
justify an award of attorneys’ fees. Id.

                                         -12-
       Jet Midwest International brought its claims under the MUFTA. The remedial
provision of the MUFTA provides for the following remedies in a creditor’s action
for relief against a fraudulent transfer:

      (1) Avoidance of the transfer or obligation to the extent necessary to
      satisfy the creditor’s claim;

      (2) An attachment or other provisional remedy against the asset
      transferred or other property of the transferee . . . ;

      (3) Subject to applicable principles of equity and in accordance with
      applicable rules of civil procedure,

             (a) An injunction . . . ;

             (b) Appointment of a receiver . . . ; or

             (c) Any other relief the circumstances may require.

Mo. Rev. Stat. § 428.039.

        As the Missouri Court of Appeals has recognized, “there is no express
statutory authorization . . . for the award of attorney’s fees” under MUFTA. Volk
Constr. Co., 58 S.W.3d at 901.

                         3. Special Circumstances Exception
       Jet Midwest International alternatively argues that the district court was
justified in awarding attorneys’ fees to it “under the ‘special circumstances exception
to the American Rule, which includes situations where a party is shown to have
engaged in intentional misconduct.’” Appellee’s Br. at 73 (quoting Volk Constr. Co.,
58 S.W.3d at 901); see also State ex rel. Vescovo v. Clay Cnty., 589 S.W.3d 575,
589–90 (Mo. Ct. App. 2019) (“A party’s ‘intentional misconduct’ has . . . been

                                         -13-
deemed a ‘special circumstance’ supporting an award of fees.” (quoting Klinkerfuss
v. Cronin, 289 S.W.3d 607, 619 (Mo. Ct. App. 2009))).4

       “Special circumstances . . . are rare, and courts have confined th[is] exception[]
to limited fact situations.”Vescovo, 589 S.W.3d at 589. A Missouri court found
special circumstances existed in Volk Construction Co.—a MUFTA case. In that case,
the Missouri Court of Appeals “upheld an award of attorney’s fees under the
special-circumstances exception to the American Rule where the defendants engaged
in intentional misconduct involving transfers with the intent to hinder, delay, and
defraud creditors.” Klinkerfuss, 289 S.W.3d at 618 (citing Volk Constr. Co., 58
S.W.3d at 901). The trial court had found that after the plaintiff sued the corporation,
the defendants created security interests and received accounts receivable owed to the
corporation. Volk Constr. Co., 58 S.W.3d at 899. It had also “found that the
challenged transactions were done with the actual intent to hinder, delay and defraud
creditors of the [c]orporation in favor of the [defendants].” Id. (emphasis added).
Based on its findings, “[t]he trial court therefore concluded that these transfers
constituted a fraudulent transfer as to [the corporation’s] creditors, including the
[plaintiff]” and awarded attorneys’ fees to the plaintiff. Id. On appeal, the Missouri
Court of Appeals acknowledged the lack of any “express statutory authorization or
contractual provision for the award of attorney’s fees,” but it found “the award of
attorney’s fees . . . justified under the ‘special circumstances’ exception to the
American Rule, which includes situations where a party is shown to have engaged in
intentional misconduct.” Id. at 901. The court cited the trial court’s specific finding

      4
        This court has previously “upheld a fee award based on special circumstances
in a case involving causes of action in contract and tort.” Jo Ann Howard & Assocs.,
11 F.4th at 887 (citing Kelly v. Golden, 352 F.3d 344, 352 (8th Cir. 2003)). “No
decision of the Missouri Supreme Court has superseded Kelly; the Missouri [Supreme
Court] [has] assumed without deciding that the exception applies in non-declaratory
judgment cases.” Id. (citing Trs. of Clayton Terrace Subdiv. v. 6 Clayton Terrace,
LLC, 585 S.W.3d 269, 286 (Mo. 2019) (en banc)).
                                          -14-
“that the [defendants] completed the transfers with the actual intent to hinder, delay
and defraud creditors of the [c]orporation” and concluded that the record supported
this finding. Id. The court held that the trial court did not abuse its discretion in
awarding attorneys’ fees and therefore affirmed the award to the plaintiff. Id.; see also
Taylor v. Clark, 140 S.W.3d 242, 257 (Mo. Ct. App. 2004) (“We agree . . . that cases
involving fraudulent transfers allow for the award of both attorney’s fees and punitive
damages.” (citing Volk Constr. Co., 58 S.W.3d at 901)).

        Here, the district court did not invoke the special circumstances exception to
the American Rule in awarding attorneys’ fees to Jet Midwest International.
Nonetheless, the court’s fact findings support an attorneys’ fees award on that basis.
See Thole v. U.S. Bank, Nat’l Ass’n, 873 F.3d 617, 626 (8th Cir. 2017) (“We may
affirm for any reason supported by the record, even if different from the reasons given
by the district court.” (internal quotation marks omitted)), aff’d sub nom. Thole, 140
S. Ct. 1615. As in Volk Construction Co., the district court found that JMG and the
Ohadi/Woolley defendants acted with “actual intent to hinder, delay and defraud” Jet
Midwest International. 58 S.W.3d at 901. Specifically, the district court found that
“JMG transferred the . . . share certificates to the Ohadi Trust in January 2018
. . . with actual intent to hinder, delay and defraud [Jet Midwest] International.” Jet
Midwest Int’l Co. v. Jet Midwest Grp., LLC, No. 5:18-cv-06019-FJG, 2020 WL
4819416, at *66 (W.D. Mo. May 26, 2020), amended, No. 5:18-cv-06019-FJG, 2020
WL 13049652 (W.D. Mo. Aug. 6, 2020), and aff’d, No. 20-2285, 2023 WL 2507218
(8th Cir. Mar. 15, 2023) (unpublished per curiam). “The sole effect of this transfer
was to hinder, delay and defraud Jet Midwest International by preventing Jet Midwest
International from satisfying a portion of the Judgment.” Id. The district court also
found that “[b]ecause the sole effect of this transfer was to hinder, delay and defraud
[Jet Midwest] International, Defendants’ intent was fraudulent.” Id. at *67 (emphasis
added). It likewise found that “[w]hen JMG and the Ohadi Trust entered into the SAA
[Security Agreement Amendment] . . . , they did so with actual intent to hinder, delay
and defraud [Jet Midwest] International,” id. at *68, that “because the actual effect

                                          -15-
of the SAA was to hinder and delay the enforcement of the Judgment, this must have
been intentional,” id. at *69, and that “[t]he Proposed Foreclosures[5]—like the SAA
on which the Proposed Foreclosures purport to be based—are designed to hinder,
delay and defraud Jet Midwest International,” id. at *74. The district court’s factual
findings support application of the special circumstances exception to justify the
award of attorneys’ fees to Jet Midwest International.

                         B. Calculation of Attorneys’ Fees
       Because the special circumstances exception serves as the basis for an award
of attorneys’ fees to Jet Midwest International, the district court was required to
calculate a reasonable attorneys’ fee. See Jo Ann Howard & Assocs., P.C. v. Cassity,
No. 4:09-cv-01252-ERW, 2020 WL 870987, at *4 (E.D. Mo. Feb. 21, 2020), aff’d
sub nom. Jo Ann Howard & Assocs., 11 F.4th 876.

      “The starting point in determining attorney fees is the lodestar, which is
calculated by multiplying the number of hours reasonably expended by the reasonable
hourly rates.” Fish v. St. Cloud State Univ., 295 F.3d 849, 851 (8th Cir. 2002) (citing
Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)); see also Harrison v. Harris-Stowe
State Univ., 626 S.W.3d 843, 860 n.5 (Mo. Ct. App. 2021) (stating that “[t]he
‘lodestar’ is the starting point in determining reasonable attorneys’ fees”). “As a
general rule, a reasonable hourly rate is the prevailing market rate, that is, ‘the
ordinary rate for similar work in the community where the case has been litigated.’”
Moysis v. DTG Datanet, 278 F.3d 819, 828 (8th Cir. 2002) (quoting Emery v. Hunt,
272 F.3d 1042, 1048 (8th Cir. 2001)). “The court ‘has great latitude to determine a
reasonable hourly rate because it is intimately familiar with its local bar.’” Burton v.
Nilkanth Pizza Inc., 20 F.4th 428, 431 (8th Cir. 2021) (quoting Childress v. Fox

      5
       “On November 29, 2018, the Ohadi Trust and KMW [Business Jets, LLC]
simultaneously announced their intent to foreclose (the ‘Proposed Foreclosures’) on
JMG’s remaining inventory.” Jet Midwest Int’l Co., 2020 WL 4819416, at *34.
                                         -16-
Assocs., LLC, 932 F.3d 1165, 1172 (8th Cir. 2019)). “When calculating the lodestar,
a district court need not accept counsel’s submission of hours as conclusive but
should exclude from that total those hours that were not reasonably expended on the
litigation.” Fires v. Heber Springs Sch. Dist., 565 F. App’x 573, 575 (8th Cir. 2014)
(unpublished per curiam) (citing Hensley, 461 U.S. at 433–34). “Although the district
court need not explicitly state which hours it finds reasonable, it must at least
calculate the hourly rate and the reasonable number of hours worked.” Vines v.
Welspun Pipes Inc., 9 F.4th 849, 856 (8th Cir. 2021) (citing Fires, 565 F. App’x at
576). “In sum, the court should calculate the reasonable hourly rate and the
reasonable number of hours worked [and] use these two variables to calculate the
lodestar . . . .” Burton, 20 F.4th at 431. “[T]here is a ‘strong presumption’ that the
lodestar figure is reasonable, but that presumption may be overcome in those rare
circumstances in which the lodestar does not adequately take into account a factor
that may properly be considered in determining a reasonable fee.” Perdue v. Kenny
A. ex rel. Winn, 559 U.S. 542, 554 (2010).6

      “After calculating a fee award using either the lodestar method . . . , district
courts generally evaluate ‘the ultimate reasonableness of the award . . . by
considering relevant factors . . . .’” League of Women Voters of Mo. v. Ashcroft, 5

      6
         “Both the Supreme Court and this court have explained . . . that the lodestar
calculation is usually necessary.” Vines, 9 F.4th at 856 (citing Blanchard v. Bergeron,
489 U.S. 87, 94 (1989) (explaining that Hensley “directed lower courts to make an
initial estimate of reasonable attorney’s fees by [calculating the lodestar]” and calling
“the lodestar approach . . . the centerpiece of attorney’s fee awards”); H.J. Inc. v.
Flygt Corp., 925 F.2d 257, 259–60 (8th Cir. 1991) (“The approach followed by this
circuit requires the calculation of a lodestar figure . . . .”)).

       We wish to emphasize that the district court is not required to do a line-by-line
analysis of voluminous billing records. Rather, the district court is in the best position
to determine whether the hours, whether in total or by category, are reasonable given
its familiarity with the case and to make the appropriate adjustment.

                                          -17-
F.4th 937, 941 (8th Cir. 2021) (second alteration in original) (quoting In re Target
Corp. Customer Data Sec. Breach Litig., 892 F.3d 968, 977 (8th Cir. 2018)).7
“Although there is no one methodology for calculating an award of fees, it is
important ‘for the district court to provide a concise but clear explanation of its
reasons for the fee award.’” Marez v. Saint-Gobain Containers, Inc., 688 F.3d 958,
966 (8th Cir. 2012) (quoting Hensley, 461 U.S. at 437).

       Here, Jet Midwest International did provide the district court with lodestar
charts and other information. See Jet Midwest Int’l Co., 2021 WL 1397224, at *3
(“Also included in the exhibits is a lodestar chart detailing the names of all the
timekeepers, the dates they worked on the case, their position, their actual hourly rate,
the total hours worked and the total fees for each timekeeper.”). But the district court
never set forth its lodestar calculation prior to considering additional factors in
calculating the attorneys’ fees award. “Because the record contains no lodestar
calculation, we vacate the award of attorneys’ fees.” Vines, 9 F.4th at 857. The district
court’s consideration of additional factors “should come after the district court
calculates the lodestar and has moved on to [adjusting] that number.” Id.

      7
      In Missouri, “[o]ther relevant factors in determining the reasonable value and
amount of [attorneys’] fees include” the following:

      1) the rates customarily charged by the attorneys involved in the case
      and by other attorneys in the community for similar services; 2) the
      number of hours reasonably expended on the litigation; 3) the nature and
      character of the services rendered; 4) the degree of professional ability
      required; 5) the nature and importance of the subject matter; 6) the
      amount involved or the result obtained; and 7) the vigor of the
      opposition.

Berry v. Volkswagen Grp. of Am., Inc., 397 S.W.3d 425, 431 (Mo. 2013) (en banc)
(quoting Hill v. City of St. Louis, 371 S.W.3d 66, 81–82 (Mo. Ct. App. 2012)).

                                          -18-
                              C. Entitlement to Expenses
       The Ohadi/Woolley defendants argue that the district court abused its
discretion in awarding expenses to Jet Midwest International. First, they challenge the
taxing of expert fees. They argue that “the taxing of expert fees is strictly limited as
a cost under 28 U.S.C. § 1920” and that “[e]xpert fees are generally not part of
attorneys’ fees either.” Appellants’ Br. at 40. Furthermore, they argue, Jet Midwest
International “failed to provide any basis for the allowance of expert fees against
[them], much less the reasonableness of $1,117,791.24 in expert fees” because Jet
Midwest International’s “experts provided almost no description of the work
performed.” Id. As a result, they maintain that the district court “did not . . . determine
if the amount of time was reasonably spent, excessive, or duplicative” or “consider
whether 2,794.51 hours spent by expert witnesses was reasonable under the
circumstances of this case, or whether their rates were reasonable.” Id. Second, the
Ohadi/Woolley defendants argue that the district court erred in determining “that the
remaining $364,748.32 in costs were ‘attributable to other third-party costs, including
printing, legal research, and court reporting services.’” Id. at 41. According to the
Ohadi/Woolley defendants, Jet Midwest International “provided no supporting
documentation, meaningful descriptions, or other information from which the [c]ourt
could have identified the nature of the expenses, the purpose of the expenses, or the
necessity or reasonableness of the expenses.” Id.

       Jet Midwest International counters that there is “contractual authorization”
under the Term Loan Agreement for an award of costs against the Ohadi/Woolley
defendants. Appellee’s Br. at 96. It also notes that “[j]oint and several liability for
costs is the general rule unless equity otherwise dictates.” Id. at 75 (emphasis added)
(quoting Concord, 309 F.3d at 497).

      “[F]ederal courts are bound by the limitations [on expenses] set out in 28
U.S.C. § 1821 and § 1920” in the “[a]bsen[ce] [of] explicit statutory or contractual

                                           -19-
authorization for the taxation of an expense as costs.” Johnson, 950 F.3d at 527
(internal quotation marks omitted). For the reasons previously stated, we conclude
that the Term Loan Agreement cannot serve as the basis for awarding costs against
the Ohadi/Woolley defendants. See supra Part II.A.1. “Although parties may allocate
costs by agreement, [Jet Midwest International] d[id] not provide evidence of an
enforceable contract” between it and the Ohadi/Woolley defendants. Johnson, 950
F.3d at 527. While the district court was authorized to hold the Ohadi/Woolley
defendants jointly and severally liable for costs in the Fraudulent Transfer Action, see
Concord, 309 F.3d at 497, it could do so under 28 U.S.C. § 1920, not the Term Loan
Agreement.

      Section 1920 sets forth the “expenses that a federal court may tax as costs
against the losing party.” Crawford Fitting Co., 482 U.S. at 440. It provides, in
relevant part:

      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;[8]

             (4) Fees for exemplification and the costs of making copies of any
             materials where the copies are necessarily obtained for use in the
             case;

      8
        Section 1821 defines “[t]he witness fee specified in § 1920(3).” Crawford
Fitting Co., 482 U.S. at 440 (citing 28 U.S.C. § 1821 (enumerating witness fees and
disbursements)).

                                         -20-
             (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.

       In turn, Federal Rule of Civil Procedure 54(d)(1) provides that “[u]nless a
federal statute, these rules, or a court order provides otherwise, costs—other than
attorney’s fees—should be allowed to the prevailing party.” “[Section] 1920 defines
the term ‘costs’ as used in Rule 54(d). Section 1920 enumerates expenses that a
federal court may tax as a cost under the discretionary authority found in Rule 54(d).”
Crawford Fitting Co., 482 U.S. at 441–42. Under Rule 54(d), “[a] prevailing party is
presumptively entitled to recover all of its costs.” In re Derailment Cases, 417 F.3d
840, 844 (8th Cir. 2005). “However, such costs must be set out in 28 U.S.C. § 1920
or some other statutory authorization.” Smith v. Tenet Healthsystem SL, Inc., 436 F.3d
879, 889 (8th Cir. 2006) (citing Crawford Fitting Co., 482 U.S. at 438). “District
courts have substantial discretion in awarding costs under Rule 54(d).” Id.

        “[A]bsent explicit statutory or contractual authorization for the taxation of the
expenses of a litigant’s witness as costs, federal courts are bound by the limitations
set out in 28 U.S.C. § 1821 and § 1920.” Crawford Fitting Co., 482 U.S. at 445. “The
[MUFTA] does not explicitly authorize the taxation of the expert witness fees as
costs, and neither § 1821 nor § 1920 allows them.” Orduno v. Pietrzak, 932 F.3d 710,
720 (8th Cir. 2019); see also Johnson, 950 F.3d at 527 (“Taxing of expert fees is
strictly limited.”). Although some nontaxable costs “might be awarded as attorney’s
fees if they are separately billed under the prevailing practice in the local
community,” “expert witness fees are generally not part of attorney’s fees.” Johnson,
950 F.3d at 528 (emphasis added).

                                          -21-
       Here, Jet Midwest International joined its request for costs with its attorneys’
fee request. It sought $8,753,729.59 at an interest rate of 14 percent per annum from
the date of each invoice until the award is paid. Also, Jet Midwest International
sought $1,117,791.24 for costs incurred in retaining three expert witnesses: Kenneth
Yormark (forensic accounting expert); Joseph DiSalvatore (insolvency expert) and
David Tokoph (aviation expert). As Johnson explains, these fees “are generally not
part of attorney’s fees.” Id. On remand, “the court may determine whether [these
nonrecoverable costs] may be awarded as attorney’s fees.” Id.

        Jet Midwest International represented to the district court that “$364,748.32
was attributable to other third-party costs, including printing, legal research and court
reporting services.” Jet Midwest Int’l Co., 2021 WL 1397224, at *3. Jet Midwest
International provided substantial documentation to the district court in support of its
requests, but the district court offered no analysis of such requests. We remand for the
district court to consider to what extent these costs are recoverable under § 1920. See,
e.g., 28 U.S.C. § 1920(2)–(3) (“A judge . . . may tax as costs . . . [f]ees or printed or
electronically recorded transcripts necessarily obtained for use in the case . . . [and]
[f]ees and disbursements for printing and witnesses . . . .”); Hernandez v. Bridgestone
Ams. Tire Operations, LLC, 831 F.3d 940, 950 (8th Cir. 2016) (per curiam) (“[I]f the
prevailing party demonstrates that separately billing for CLR is the ‘prevailing
practice in a given community’ and that such fees are reasonable, the district court
may award those costs.” (quoting Missouri v. Jenkins, 491 U.S. 274, 287 (1989));
Studiengesellschaft Kohle mbH v. Eastman Kodak Co., 713 F.2d 128, 133–34 (5th
Cir. 1983) (“[T]he cost of original depositions is taxable without any factual
finding. . . . , and the cost of copies is taxable only if the copies were necessarily
obtained for use in the case.”); Favata v. Nat’l Oilwell Varco, LP, No. 2:12-cv-82,
2014 WL 5822781, at *3 (S.D. Tex. Nov. 10, 2014) (“It is generally recognized that
the basic costs of an original deposition transcript and one copy are taxable against
the non-prevailing party.”).

                                          -22-
                               III. Conclusion
      Accordingly, we vacate the award of attorneys’ fees and costs against the
Ohadi/Woolley defendants and remand for further proceedings consistent with this
opinion.9
                    ______________________________

      9
       Our holdings are limited to the Ohadi/Woolley defendants. JMG and Jet
Midwest International previously entered a stipulation for partial dismissal of the
cross-appeal with respect to JMG in No. 21-1858 regarding attorneys’ fees and costs.
Our holding does not limit JMG’s ultimate responsibility for attorneys’ fees and costs
under the Term Loan Agreement, as set forth in Jet Midwest Int’l, 932 F.3d 1102.

                                        -23-