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JPMorgan Chase Bank, N.A. v. Winget

United States District Court, E.D. Michigan, Southern Division

January 9, 2018

JPMORGAN CHASE BANK, N.A. Plaintiff/Counter-Defendant,
v.
LARRY J. WINGET and the LARRY J. WINGET LIVING TRUST, Defendants/Counter-Plaintiffs.

          MEMORANDUM AND ORDER GRANTING CHASE'S MOTION FOR COSTS AND EXPENSES [1] (DOC. 709) [2]

          AVERN COHN UNITED STATES DISTRICT JUDGE.

         I. Introduction

         This is a commercial dispute. J. P. Morgan Chase (Chase) is the administrative agent for a group of lenders that extended credit to Venture Holdings Company, LLC (Venture) under a credit agreement. In 2008, Chase sued Larry J. Winget (Winget) and the Larry J. Winget Living Trust (Winget Trust) to enforce a Guaranty and two Pledge Agreements entered into by Winget and signed by Winget and the Winget Trust in 2002, guaranteeing the obligations of Venture. After years of litigation and multiple appeals, on July 28, 2015, the Court entered an Amended Judgment in favor of Chase and against Winget and the Winget Trust that enforced the Guaranty and Pledge Agreements against Winget and the Winget Trust. Specifically, the judgment against the Winget Trust was in the amount of $425, 113.115.59. The judgment against against Winget was limited to $50 million. (Doc. 568). The Court also issued an order awarding Chase $11, 154, 874.65 in attorney fees and expenses (Fee Order) associated with its efforts to enforce the Guaranty and Pledge Agreements through May 31, 2015. (Doc. 671). As will be explained, Winget and the Winget Trust appealed the Amended Judgment and Fee Order. The appeals were resolved in Chase's favor.

         Before the Court is Chase's second motion for expenses incurred since the issuance of the Fee Order in the amount of $2, 000, 316.24. Chase says that this amount represents the services of Sidley Austin LLP and Dickinson Wright PLLC between June 1, 2015 and November 30, 2016. For the reasons that follow, the motion is GRANTED.

         II. Background

         In the Amended Judgment, the Court determined that Winget and the Trust are liable to Chase for the attorneys' fees and related expenses incurred in pursuing Chase's rights under the Guaranty signed by Winget and the Trust. (Doc. 568 at 3; see also Doc. 487-1 at 8-9 (Guaranty).)

         Chase previously moved for an award of expenses under Section 17 of the Guaranty incurred through May 31, 2015. (Doc. 563). The Court granted the motion in part and awarded Chase $11, 154, 874.65 in expenses (Fee Order) associated with its efforts to enforce the Guaranty and Pledge Agreements through May 31, 2015. (Doc. 671). Winget and the Winget Trust appealed the Fee Order.

         Winget then moved for partial satisfaction of the Amended Judgment, contending that his payment of $50 million satisfied the Fee Order (Doc. 672). The Court denied the motion (Satisfaction Order). (Doc. 683). Winget and the Winget Trust appealed both the Satisfaction Order and the Fee Order. The Court stayed proceedings on Chase's motion for expenses pending the outcome of the appeal. (Doc. 732).

         The Sixth Circuit affirmed, finding that the Court had properly interpreted the language of the Guaranty to hold both Winget and the Winget Trust responsible for the full payment of costs and expenses correctly held there had been no “partial satisfaction” of the award of costs and expenses, and properly determined that the doctrine of res judicata did not apply. Chase v. Winget, No. 16-2130 (6th Cir. Jul. 21, 2017) (Doc. 735) In light of the Sixth Circuit's ruling and mandate, on Chase's motion, the Court lifted the stay. (Doc. 752).

         III. Parties' Arguments

         Winget contends:

1. Chase should not be awarded expenses related to the prosecution of its fraudulent transfer claim
2. Chase's attorneys' hourly rates grossly exceed the prevailing market rate and should be significantly reduced
3. Chase's attorneys' hours are excessive and reflect duplicative work and over-staffing
4. Chase's attorney and paralegal rates are excessive and inappropriate to the extent they charge professional rates ...

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