Court Awards Reduced Attorneys’ Fees Where Fee Submission is Not Reasonable

On October 3, 2023, Justice Melissa A. Crane, of the New York County Commercial Division issued a decision in Fuks v. Rakia––– Associates, Index No. 122768/1998, granting defendant’s request for attorneys’ fees, but reducing the amount of fees requested by 50%. In a prior order, the court had permitted the defendant to seek reasonable attorneys’ fees incurred solely in prosecuting a prior claim for a constructive trust, as permitted by the partnership agreement. However, the defendant’s motion for attorneys’ fees failed to distinguish between fees incurred prosecuting that claim and the instant action, and also improperly included block billing and other issues. The Court thus reduced the fee award, explaining:

First, in the April 10, 2023 dated decision on Motion Seq. No. 29, the court denied the part of the motion seeking a modification to Shomron's alleged attorneys fees, without prejudice to a separate motion for REASONABLE attorney's fees and limited to those fees incurred prosecuting the constructive trust claim (Doc 115 [4/10/23 Decision] at 12). However, the time records submitted in support of this attorneys' fee request do not differentiate between those fees generally incurred in prosecuting this case, versus those fees that were specifically incurred in prosecuting the constructive trust claim, as specified in the Order. In fact, counsel submits over a hundred pages of time records and invoices for this motion, but fails to direct the court's attention, in any way, to the relevant entries related to just those fees incurred in prosecuting the constructive trust claim.

Additionally, the invoices and time entries are also unclear on whether such work was being performed for one action, the other action, or both, and ultimately fail to differentiate what work is being done for which case. The time records and invoices counsel submitted also clearly highlight the duplicative and unnecessary work that was performed throughout the past three decades that this case has been pending. The records and invoices are clear evidence of denying the plaintiff’s motion for summary judgment in lieu of complaint based on improper service of process. overlitigation and underscore the numerous instances of unnecessary legal work that counsel performed.

The invoices and time entries are also rife with instances of block billing, making it nearly impossible for the court to discern how much time was spent on each specific task and ultimately prevents the court from determining the reasonableness of the fee request.

The court thus awarded fees in the amount of $176,445.10, “approximately 50% of the requested award, to account for inefficiencies, overlitigation, duplicative efforts and work, and excessive block-billing.”

Contact the Commercial Division Blog Committee at commercialdivisionblog@schlamstone.com if you or a client have questions concerning making or defending a motion seeking an award of attorney’s fees.