Commercial Division Blog

Posted: July 29, 2022 / Written by: Jeffrey M. Eilender, Samuel L. Butt, Christopher R. Dyess, Joshua Wurtzel, Hillary S. Zilz / Categories Attorney Fees, Sanctions

Attorneys' Fees Awarded Even in Absence of Itemized Time Records

On May 7, 2022, Justice Andrea Masley of the New York County Commercial Division issued a decision in Continental Industries Group, Inc. v. Ustuntas, 2022 N.Y. Slip Op. 31525(U), awarding attorneys' fees to defendants even when defendants' counsel did not submit hourly or line-item invoices, explaining:

Defendants' counsel submitted an affirmation explaining that her firm became counsel of record for defendants in January 2017 and does not have a traditional hourly fee arrangement with the defendants,
requiring hourly or line-item invoices; rather, her firm's invoices, with certain exceptions, contain flat fees for monthly case administration and discovery charges. 

. . .

Attorneys' fees were awarded in this matter because of plaintiff's egregious conduct whereby they denied possession and/or existence of a server from the start of litigation until 2017 when plaintiff submitted the affidavit of its IT Manager, and wife of plaintiff's sole owner, who affirmed that the server was in a closet. As the fee arrangement between the defendants and their counsel does not lend itself to a line-by-line review of invoices detailing hours spent on specific tasks, [*4] the court will apply its own knowledge of hours typically spent on the application for sanctions. Defendants' counsel's hourly rate of $350 is very reasonable for her experience. The court finds that on an application such as this, an attorney typically expends 5 hours to research and draft motion papers, but here there was significant time invested discussing and searching for the server which was in plaintiff's closet all along for which the court adds another 20 hours. In addition, the court finds it reasonable to award defendants attorneys' fees in connection with obtaining the server after the June 2018 Order was issued. Defense counsel's services in doing so and invoices of $5,860 and $6,412.60 [**4] are reasonable. (See NYSCEF 336 and 382, Invoices.) Thus, defendants are entitled to a total award of attorneys' fees of $21,022.60. 

Courts generally rely on counsel's itemized time records to assess the reasonableness of a fee request. But as this case shows, in rare circumstances, the court may rely on its own expertise and experience on a fee motion when itemized time records are unavailable. Contact the Commercial Division Blog Committee at commercialdivisionblog@schlamstone.com if you or a client have questions concerning a motion for attorneys' fees.