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H.D.V.- Greektown, L.L.C v. City of Detroit

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

January 25, 2018

H.D.V. - GREEKTOWN, L.L.C., et al., Plaintiffs,
v.
City of Detroit, Defendant.

          Senior U.S. District Judge Arthur J.

          ORDER ADOPTING IN PART REPORT AND RECOMMENDATION [179]; OVERRULING PLAINTIFFS' OBJECTION [181]; GRANTING IN PART PLAINTIFFS' SECOND MOTION FOR ATTORNEY'S FEES [174]

          Arthur J. Tarnow Senior United States District Judge

         Plaintiffs H.D.V. - Greektown, 415 East Congress, and K&P Inc. filed a Second Supplemental Motion for Attorney's Fees and Costs [174] on September 20, 2016. Defendant City of Detroit filed a Response [176] on October 4, 2016. Plaintiffs filed a Reply [178] on October 18, 2016.

         On September 28, 2017, the Magistrate Judge issued a Report and Recommendation (“R&R”) [179] recommending that the Court grant in part and deny in part Plaintiffs' Motion. The R&R further recommends that the Court award Plaintiffs' counsel a total of $905, 718.56, subject to the orders of the Bankruptcy Court. [Dkt. #180].

         For the reasons stated below, the R&R [179] is ADOPTED in part; Plaintiffs' Objection [181] is OVERRULED; and Plaintiffs' Second Motion for Attorney's Fees [174] is GRANTED in part and DENIED in part.

         Factual and Procedural Background

         Plaintiffs, closely-held Michigan limited liability companies in the adult entertainment business, alleged that Defendant violated their First Amendment rights by hindering the operation of their businesses with regulations.

         On August 23, 2011, Plaintiffs obtained a $2.95 million settlement in this § 1983 action. The parties stipulated that the Court would decide the issue of attorney fees pursuant to 42 U.S.C. § 1988 and that Plaintiffs were prevailing parties for purposes of determining such fees and costs.

         On October 4, 2011, Plaintiffs filed their first Motion for Attorney Fees and Costs [148], in which they sought over $1.5 million. On May 23, 2016, the Magistrate Judge issued an R&R [162] recommending that the Court grant in part and deny in part Plaintiffs' Motion. Specifically, the R&R recommended that the Court reduce Plaintiffs' request for attorney fees by 60%. The R&R [162] further recommended that the Court decline to grant a fee enhancement, and impose a 3% cap on the fees incurred litigating the attorney fee issue (“fees for fees”). On March 31, 2015, the Court issued an Order [169] adopting the R&R and overruling Plaintiffs' objections.

         Plaintiffs filed a Notice of Appeal [170] on April 20, 2015. On appeal, the Sixth Circuit affirmed in part, reversed in part, and remanded to the district court. H.D.V. - Greektown, LLC v. City of Detroit, 660 F. App'x 375, 378 (6th Cir. 2016). The Sixth Court held, inter alia, that the district court abused its discretion when it failed to adequately explain why a 60% reduction was appropriate. Id. at 385. The Court further held that the award must be recalculated in light of the Sixth Circuit's decision in The Ne. Ohio Coal. for the Homeless v. Husted, 831 F.3d 686, 720 (6th Cir. 2016).[1] Id. at 387.

         In their Second Supplemental Motion for Attorney's Fees and Costs [174], Plaintiffs argue that they are entitled to additional attorney fees and costs, such as costs related to appellate litigation. Plaintiffs further argue that they are entitled to a substantial fee enhancement because of the City of Detroit's bankruptcy status.

         In its Response [176], Defendant does not contest Plaintiffs' right to recover the additional attorney fees and costs associated with the appeal. Moreover, Defendant concedes that Plaintiffs' hourly rates are reasonable. Id. at 11. Although Defendant maintains that the total amount Plaintiffs seek is excessive, Defendant nevertheless waives any objections contesting the total time incurred by counsel in preparing the instant Motion. However, Defendant argues that Plaintiffs are neither entitled to bill in quarter-hour increments for all tasks, nor entitled to an enhancement of fees.

         The R&R [179] recommends that the Court grant in part and deny in part Plaintiffs' Motion [174]. In particular, the R&R: accepts Plaintiffs' claimed hourly rates in computing the lodestar as reasonable (Section III-A); accepts Plaintiffs' “fees for fees” award request as reasonable (Section III-B); recommends an 80% reduction to certain fees and a 10% reduction to remaining fees (Section III-C); recommends awarding costs associated with the appeal, but reducing quarter-hour billing to one-tenth hour billing (Section III-D); and recommends denying Plaintiffs' request for a fee enhancement (Section III-D).[2]

         On October 12, 2017, Plaintiffs filed an Objection [181] to the R&R. Plaintiffs solely object to Section III-E, which recommends that the Court decline to impose a fee enhancement.

         Standard ...


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