Court Opinion

ID: 42643
Source: CourtListenerOpinion
Date Created: 2010-04-25 21:23:35+00
Date Added: 2024-06-11T14:57:31.739973
License: Public Domain

[DO NOT PUBLISH]

               IN THE UNITED STATES COURT OF APPEALS

                         FOR THE ELEVENTH CIRCUIT
                          ________________________                       FILED
                                                               U.S. COURT OF APPEALS
                                                                 ELEVENTH CIRCUIT
                                 No. 04-13243                        August 30, 2005
                             Non-Argument Calendar                THOMAS K. KAHN
                           ________________________                     CLERK

                      D.C. Docket No. 02-80127-CV-DTKH

PEPI SCHAFLER, Dr.,

                                                            Plaintiff-Appellant,

      versus

FAIRWAY PARK CONDOMINIUM ASSOCIATION,
AND EACH INDIVIDUAL MEMBER OF THE BOARD, et al.,

                                                            Defendants-Appellees.

                          __________________________

               Appeal from the United States District Court for the
                          Southern District of Florida
                         _________________________
                               (August 30, 2005)

Before BIRCH, BLACK and PRYOR, Circuit Judges.

PER CURIAM:

      Dr. Pepi Schafler, a pro se litigant in a diversity action, appeals the district

court’s award of attorneys’ fees to Indian Springs Maintenance Association
(“Indian Springs”). After reviewing the record and the contentions of the parties,

we AFFIRM.

                               I. BACKGROUND

      On 12 February 2002, Schafler initiated an action in the United States

District Court for the Southern District of Florida against Indian Springs and

various other defendants. She alleged, inter alia, that Indian Springs improperly

rejected a tenant to whom she had agreed to lease her condominium. The district

court granted the defendants’ motion to dismiss and denied Schafler’s motion for

reconsideration.

      On appeal, we affirmed the district court’s order of dismissal. Additionally,

we granted Indian Springs’s motion for appellate attorneys’ fees and remanded the

case to the district court to determine the amount to be awarded. At a subsequent

evidentiary hearing before a magistrate judge, Hugo Alvarez, an attorney of the

firm representing Indian Springs on its defense of Schafler’s appeal, testified

regarding his firm’s representation. He testified that his firm is appointed by CNA

Insurance and that CNA Insurance has paid his firm the fees at issue. Adopting

the report and recommendation of the magistrate judge, the district court awarded

Indian Springs $3,290 in attorneys’ fees. Schafler moved for reconsideration and

argued that Indian Springs had no standing to make a claim for attorneys’ fees

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because those fees had already been paid by its insurance company. The district

court denied Schafler’s motion for reconsideration, and Schafler timely appealed.

       On appeal, Schafler argues that the district court erred in awarding Indian

Springs attorneys’ fees because the legal work completed by Alvarez had already

been paid by Indian Springs’s insurance company.1

                                      II. DISCUSSION

           An award of attorneys’ fees is reviewed for abuse of discretion. Mut. Serv.

Ins. Co. v. Frit Indus., Inc., 358 F.3d 1312, 1322 (11th Cir. 2004). “‘An abuse of

discretion occurs if the judge fails to apply the proper legal standard or to follow

proper procedures in making the determination or bases an award [or a denial]

upon findings of fact that are clearly erroneous.’” Id. (citation omitted).

       Under Florida law, a prevailing party may be entitled to payment of

attorneys’ fees by a losing party if that party or its attorney “knew or should have

known that a claim or defense when initially presented to the court or at any time

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          Additionally, Schafler argues that Alvarez committed perjury in an affidavit submitted
to our court by stating (1) that Indian Springs “‘retained’” his law firm, when in fact his firm is
appointed by Indian Springs’s insurance company; and (2) that Indian Springs “‘is responsible’”
for paying his firm’s fees, when in fact its insurance company paid the fees. Appellant’s
Opening Brief at 9. Schafler thus requests that we refer Indian Springs’s counsel for criminal
prosecution. In response, Indian Springs requests that we admonish Schafler. We decline both
requests.
        In her reply brief, Schafler also contends that the district court lacked jurisdiction to
determine the amount of the attorneys’ fees award because it previously had dismissed the case
for lack of jurisdiction. This argument has no merit.

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before trial: (a) was not supported by the material facts necessary to establish the

claim or defense; or (b) would not be supported by the application of then existing

law to those material facts.” FLA. STAT. ANN. § 57.105(1). The purpose of this

rule “‘is to discourage baseless claims, stonewall defenses and sham appeals in

civil litigation by placing a price tag through attorney[s]’ fees awards on losing

parties who engage in these activities.’” Schwartz v. Millon Air, Inc., 341 F.3d

1220, 1227 (11th Cir. 2003) (citation omitted). Accordingly, recovery of

attorneys’ fees has been permitted in situations where the client’s attorney has

received payment from a source other than the client, Fairley v. Patterson, 493

F.2d 598, 605-06 (5th Cir. 1974) (court properly awarded attorneys’ fees to a party

whose attorneys had received already compensation for their service from a tax

free foundation), or where the client would be indemnified by insurance for

attorneys’ fees, Church of Scientology of California v. Cazares, 638 F.2d 1272,

1291 (5th Cir. 1981) (citing Perez v. Rodriguez Bou, 575 F.2d 21, 24 (1st Cir.

1978) (finding no merit “in defendant’s argument that attorneys’ fees should not

be awarded because plaintiffs . . . were not charged for the legal services they

received”)).

      Both the Florida Supreme Court and the district courts in this Circuit

employ the federal lodestar approach to set reasonable fee awards. See Loranger

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v. Stierheim, 10 F.3d 776, 781 (11th Cir. 1994) (per curiam); Fla. Patient’s Comp.

Fund v. Rowe, 472 So.2d 1145, 1150 (Fla. 1985). Under the lodestar formula, a

court must first determine the attorney’s reasonable hourly rate. Loranger, 10 F.3d

at 781. In arriving at this figure, the court may consider the twelve factors

discussed in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 717-19

(5th Cir. 1974), which provided the prior formula for calculating attorneys’ fees.

Loranger, 10 F.3d at 781 n.6. These factors include: (1) the time and labor

required, (2) the novelty and difficulty of the questions, (3) the degree of skill

necessary to serve the client properly, (4) the attorney’s inability to accept other

employment because he accepted the case, (5) the customary fee, (6) whether the

fee is fixed or contingent, (7) time limitations imposed by the client or the

circumstances, (8) the amount of damages involved and the relief or results

obtained, (9) the experience, reputation, and ability of the attorneys, (10) the

“undesirability” of the case, (11) the nature and length of the attorney’s

professional relationship with the client, and (12) awards in similar cases.

Johnson, 488 F.2d at 717-19. Next, the court takes the reasonable hourly rate and

multiplies it by the “reasonable number of compensable hours.” Loranger, 10 F.3d

at 781. This formula does not require a district court to consider insurance

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coverage or the existence of indemnification agreements. Id.; see Johnson, 488

F.2d at 717-19.

      In this case, the magistrate judge heard testimony that CNA Insurance had

paid for Indian Springs’s representation on appeal. However, a district court

determining the amount of a reasonable fee under the lodestar formula need not

consider insurance coverage or other indemnification agreements, see Johnson,

488 F.2d at 717-19, and recovery of attorneys’ fees is allowed even though the

client’s attorney has received payment from another source, see Fairley, 493 F.2d

at 605-06; Church of Scientology, 638 F.2d at 1291. Further, the reduction of an

attorneys’ fee award against a plaintiff because of the defendant’s insurance

coverage would undermine the purpose of an award of attorneys’ fees, which is to

discourage baseless appeals. Accordingly, we conclude that the district court did

not abuse its discretion in calculating the appellate attorneys’ fees to be $3,290.

                                III. CONCLUSION

      Because we conclude that the district court did not abuse its discretion in

setting the amount of appellate attorneys’ fees at $3,290, even though Indian

Spring’s counsel had already been paid by an insurance company, we AFFIRM.

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