In Gould v. Monarch Recovery Mgmt., No. 18-C-1282 (E.D. Wis. Nov. 10, 2020), the Plaintiff's counsel sought $57,073.37 in attorneys' fees after accepting an offer of judgment as to claims under the Fair Debt Collections Practices Act ("FDCPA"). Finding that counsel had achieved only limited success, the Court reduced the fees requested by fifty percent. Nonetheless, the Court still awarded the plaintiff's counsel over $20,000 on a $1,001 claim.
The claim at issue concerned a September 11, 2017 collection letter sent by Monarch Recovery Management ("Monarch") indicating that Gould owed a debt that totaled $932.30 as of the date of the letter. Gould did not dispute that she owed the debt. Rather, she alleged that the letter was deceptive in violation of § 1692e of the FDCPA because, by stating her balance "as of" the date of the letter, Monarch falsely suggested that the amount of the debt was subject to change and that it could increase due to interest or late charges. Although the claim was initially asserted as a class action, Gould's counsel subsequently withdrew her motion for class certification. After Gould filed a motion for summary judgment as to liability, Monarch made an offer of judgment for $1,001 and reasonable attorneys' fees, which Gould accepted.
Following the settlement, Gould's counsel filed a motion for attorneys' fees. In ruling on the motion, the Court did not dispute the hourly rates charged. But it found that the number of hours spent on certain tasks, including preparing a reply to Monarch's opposition to its motion for fees, was excessive. It, therefore, reduced the fee potential fee available based on the reduced hours to $43,601.11. The Court then reduced this amount by fifty percent to $21,800.56 based on the "limited success and relatively straightforward nature of the case." Although the Court found that Gould's counsel had zealously represented their client, it stated that the outcome of the case – payment of just $1 more than the potential statutory damages – was "not a sign of great success." And it noted that, had Monarch chosen to defend rather than settle, it likely would have prevailed.
This case serves as a reminder that, even if the claims may be reduced by the Court, relatively minor FDCPA claims can result in substantial attorneys' fee awards. It also demonstrates, however, that courts may be skeptical of significant fee requests in straightforward consumer-protection cases.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
