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Foraker v. USAA Casualty Insurance Co.

United States District Court, D. Oregon

August 15, 2018

PEGGY FORAKER, Plaintiff,
v.
USAA CASUALTY INSURANCE COMPANY, Defendant.

          Stephen C. Hendricks, Hendricks Law Firm, Heather A. Brann, Heather A. Brann, Attorney at Law, James R. Jennings, James R. Jennings, P.C., Attorneys for Plaintiff Peggy Foraker.

          Robert S. McLay and Joshua N. Kastan, Hayes Scott Bonino Ellingson & McLay, LLP, Matthew C. Casey, Bullivant Houser Bailey, PC, Attorneys for Defendant USAA Casualty Insurance Company.

          OPINION AND ORDER

          MICHAEL H. SIMON, UNITED STATES DISTRICT JUDGE

         In this lawsuit, Plaintiff Peggy Foraker (“Foraker”) asserted three claims against her automobile insurance carrier, Defendant USAA Casualty Insurance Company (“USAA Casualty”, arising out of a January 2012 car accident with an uninsured driver. Under Oregon common law, Plaintiff alleged breach of express contract and breach of the implied covenant of good faith and fair dealing. Plaintiff also alleged financial abuse of a vulnerable person, in violation of Oregon Revised Statutes §§ 124.005, et seq. Earlier in this action, the Court dismissed Plaintiff's claim of financial abuse.

         The Court also bifurcated the issues. In Phase I, the Court addressed Plaintiff's claim of express breach of contract. Plaintiff achieved partial success in Phase I. Specifically, Plaintiff succeeded in proving the fault of the uninsured motorist and that the accident was a substantial factor in causing Plaintiff's alleged damages, both of which USAA Casualty had denied. Before the Court is Plaintiff's motion for attorney's fees relating to her success in Phase I.

         STANDARDS

         “In an action where a federal district court exercises subject matter jurisdiction over a state law claim, so long as state law does not contradict a valid federal statute, 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.” Avery v. First Resolution Mgmt. Corp., 568 F.3d 1018, 1023 (9th Cir. 2009) (citation and quotation marks omitted). Under Oregon law, if a settlement is not made within six months after an insured files a proof of loss with an insurer and the insured brings an action against the insurer under a policy of insurance and the insured's recovery exceeds the amount of any tender made by the insurer, the insured is entitled to receive an award of reasonable attorney's fees. Or. Rev. Stat. § 742.061(1). That subsection provides in relevant part:

[I]f settlement is not made within six months from the date proof of loss is filed with an insurer and an action is brought in any court of this state upon any policy of insurance of any kind or nature, and the plaintiff's recovery exceeds the amount of any tender made by the defendant in such action, a reasonable amount to be fixed by the court as attorney fees shall be taxed as part of the costs of the action and any appeal thereon. . . .

Id.

         After concluding that a prevailing party shall recover reasonable attorney's fees, a court applying Oregon law must consider the specific factors set forth in Oregon Revised Statutes § 20.075 to determine the amount of attorney's fees to be awarded. The specific factors set forth in § 20.075(1)[1] are:

(a) The conduct of the parties in the transactions or occurrences that gave rise to the litigation, including any conduct of a party that was reckless, willful, malicious, in bad faith or illegal.
(b) The objective reasonableness of the claims and defenses asserted by the parties.
(c) The extent to which an award of an attorney fee in the case would deter others from asserting good faith claims or defenses in similar cases.
(d) The extent to which an award of an attorney fee in the case would deter others from asserting meritless claims and defenses.
(e) The objective reasonableness of the parties and the diligence of the parties and their attorneys during the proceedings.
(f) The objective reasonableness of the parties and the diligence of the parties in pursuing settlement of the dispute.
(g) The amount that the court has awarded as a prevailing party fee under ORS 20.190.
(h) Such other factors as the court may consider appropriate under the circumstances of the case.

         Or. Rev. Stat. § 20.075(1). After considering these eight factors, Or. Rev. Stat. § 20.075(2) then directs the court to consider the following additional eight factors:

(a) The time and labor required in the proceeding, the novelty and difficulty of the questions involved in the proceeding and the skill needed to properly perform the legal services.
(b) The likelihood, if apparent to the client, that the acceptance of the particular employment by the attorney would preclude the attorney from taking other cases.
(c) The fee customarily charged in the locality for similar legal services.
(d) The amount involved in the controversy and the results obtained.
(e) The time limitations imposed by the client or the circumstances of the case.
(f) The nature and length of the attorney's professional relationship with the client.
(g) The experience, reputation and ability of the attorney performing the services.
(h) Whether the fee of the attorney is fixed or contingent.

         Or. Rev. Stat. § 20.075(2). Oregon law further directs that when analyzing these factors, a court should “includ[e] in its order a brief description or citation to the factor or factors on which it relies.” McCarthy v. Or. Freeze Dry, Inc., 327 Or. 185, 190-91 (1998). The court, however, “ordinarily has no obligation to make findings on statutory criteria that play no role in the court's decision.” Frakes v. Nay, 254 Or.App. 236, 255 (2012).

         Under Oregon Revised Statutes § 20.075(2), factor (a) generally relates to the reasonableness of the number of hours expended by counsel for the prevailing party, factors (c) and (g) generally relate to the reasonableness of the hourly rates charged, and factor (d) generally informs whether an upward or downward adjustment might be appropriate. Taken together, these factors are comparable to what is often referred to as the “lodestar” method for calculating a reasonable attorney's fee. See Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542, 552 (2010) (holding that the lodestar method yields a presumptively reasonable fee, subject to either upward or downward adjustment as appropriate); see also Strawn v. Farmers Ins. Co. of Or., 353 Or. 210, 221 (2013) (“The lodestar approach that the parties have used is at least a permissible one under the statutes involved, ” including Or. Rev. Stat. § 20.075); ZRZ Realty Co. v. Beneficial Fire & Cas. Ins. Co., 255 Or.App. 525, 554 (2013) (“The lodestar method that the trial court used is a commonly applied and permissible approach for determining the reasonableness of a fee award . . . .”).

         The lodestar amount is the product of the number of hours reasonably spent on the litigation multiplied by a reasonable hourly rate. McCown v. City of Fontana, 565 F.3d 1097, 1102 (9th Cir. 2009).[2] In making this calculation, the district court should consider various factors of reasonableness, including the quality of an attorney's performance, the results obtained, the novelty and complexity of a case, and the special skill and experience of counsel. See Perdue, 559 U.S. at 553-54; Gonzalez v. City of Maywood, 729 F.3d 1196, 1209 n.11 (9th Cir. 2013).

         In determining the number of hours reasonably spent, “the district court should exclude hours ‘that are excessive, redundant, or otherwise unnecessary.'” McCown, 565 F.3d at 1102 (quoting Hensley v. Eckerhart, 461 U.S. 424, 434 (1983)). The party seeking an award of attorney's fees “has the burden of submitting billing records to ...


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