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Gil Yoro Constantino and Gemma Guillermo Constantino v. U.S. Bank

February 24, 2012

GIL YORO CONSTANTINO AND GEMMA GUILLERMO CONSTANTINO, PLAINTIFFS,
v.
U.S. BANK, N.A., TRUSTEE AND MERIDIAN FINANCIAL NETWORK, INC., DEFENDANTS.



The opinion of the court was delivered by: David Alan Ezra United States District Judge

ORDER ADOPTING THE MAGISTRATE JUDGE'S FINDINGS AND RECOMMENDATION TO DENY PLAINTIFFS' MOTION FOR ATTORNEYS' FEES

Pursuant to Local Rule 7.2(d), the Court finds this matter suitable for disposition without a hearing. After reviewing the objections and the supporting and opposing memoranda, the Court ADOPTS the Magistrate Judge's Findings and Recommendations to Deny Plaintiffs' Motion for Attorneys' Fees. (Doc. # 87.)

BACKGROUND

The instant action arises out of a note and mortgage that Plaintiffs Gil and Gemma Constantino ("Plaintiffs") executed in connection with the purchase of a home in 2006. ("FR," Doc. # 87, at 2.) The mortgage lender, Meridian Financial Network, Inc. ("Meridian") assigned the note and mortgage to U.S. Bank, National Association as Trustee for the Structured Asset Investment Loan Trust ("U.S. Bank"). (Id.) Wells Fargo Bank, N.A., doing business as America's Servicing Company ("ASC"), became the servicing agent for U.S. Bank. (Id.) On or around January 21, 2009, ASC initiated non-judicial foreclosure proceedings against Plaintiffs. (Id.) On February 17, 2009, Plaintiffs filed their Complaint for Damages and Injunctive Relief, alleging, inter alia, Truth in Lending Act violations by Meridian. (Id. at 2--3; see also "Compl.," Doc. # 1.) On April 15, 2009, U.S. Bank filed a Counterclaim against Plaintiffs for foreclosure. (FR at 3; see also Doc. # 6.)

After numerous settlement conferences between the parties and with the Court, a settlement agreement was offered by U.S. Bank on April 30, 2010, accepted by Plaintiffs on May 10, 2010, and tentatively placed on the record on August 3, 2010. (FR at 3; see also Doc. # 47.) Subsequently, as the parties were working out the mechanics of the settlement, a disagreement arose as to whether Plaintiffs were required, under the terms of the agreed upon settlement, to make an up front payment of $5,232.62. (FR at 3.)

On April 8, 2011, Plaintiffs filed a Motion to Enforce Settlement and/or for Damages for Breach of Settlement Agreement and Attorneys' Fees. (Doc. # 62.) On July 13, 2011, the Magistrate Judge issued a Findings and Recommendation ("F&R"), finding that there was a valid offer and acceptance of a settlement agreement that did not include an up front payment and recommending that this Court enforce the settlement agreement. (Doc. # 69.)

On August 1, 2011, the Magistrate Judge issued an amended F&R permitting Plaintiffs to file a motion for an award of attorneys' fees within fourteen days from the date the amended F&R was acted upon. (Doc. # 74.) The parties do not dispute that the settlement agreement that the Magistrate Judge recommended enforcing contained a provision under which U.S. Bank agreed to pay Plaintiffs $2,500.00 for attorneys' fees. (See Paer Decl. Ex. B to Pls.' Mot. Enforce Settlement, Doc. # 62-4) ("Wells Fargo hereby offers to settle the Constantino matter by entering into a loan modification . . . . In addition, Wells Fargo is willing to pay $2,500 as and for your client's attorney fees."); (Pls.' Mem. Supp. Mot., Doc. # 82, at 7--8) ("Plaintiffs initially accepted very low fees of $2500.00 as part of the settlement in order to resolve the litigation at that time."); (Def.'s Mem. Opp., Doc. # 85, at 2) ("According to the terms of the settlement agreement, Plaintiffs are entitled to receive $2,500.00 in attorney fees . . . .").

On August 11, 2011, Plaintiffs filed their first Motion for Award of Attorneys' Fees. (Doc. # 76.) This motion requested $31,236.91 in total fees, which purported to represent the fees incurred by Plaintiffs in enforcing the settlement. (Id.) Because this motion was filed before this Court acted upon the amended F&R, the Magistrate Judge denied this attorneys' fees motion as premature. (Doc. # 77.)

Over U.S. Bank's objections, on September 23, 2011, this Court issued an order adopting the amended F&R. (Docs. ## 78, 81.) The Court determined that U.S. Bank had repudiated the settlement agreement and enforced the agreement based on its finding that there was a valid offer and acceptance of a settlement agreement that did not include an up front payment. (Doc. # 81.) Plaintiffs then filed a Motion for an award of attorneys' fees on September 29, 2011. (Doc. # 82.) The Motion requests $62,191.46 in total fees, the amount allegedly expended to litigate the entire case. (Id.)

On December 15, 2011, the Magistrate Judge issued an F&R denying Plaintiffs' Motion for Attorneys' Fees. (FR at 9.) The Magistrate found that Plaintiffs waived any entitlement to additional attorneys' fees by agreeing to a settlement limiting them to $2,500.00 in fees. (Id. at 9.) Therefore, the Magistrate found and recommended that Plaintiffs' attorneys' fees be limited to $2,500.00 pursuant to the settlement agreement that was enforced-at Plaintiffs' request-by the Court on September 23, 2011. (Id.)

On December 27, 2011, Plaintiffs filed a Motion for Reconsideration of the Magistrate's F&R denying Plaintiffs' Motion for Attorneys' Fees. (Doc. # 88.) The Magistrate denied that Motion on January 19, 2012. (Doc. # 92.) On January 30, 2012, Plaintiffs filed the instant Objections to the Magistrate Judge's F&R denying Plaintiffs' Motion for Attorneys' Fees and Order denying Plaintiffs' Motion for Reconsideration. (Doc. # 93.) On February 13, 2012, Defendant filed an Opposition to Plaintiffs' Objections, incorporating by reference Defendant's October 13, 2011 Opposition to Plaintiff's Motion for attorneys' fees and Defendant's January 10, 2012 Opposition to Plaintiffs' Motion for reconsideration. (Doc. # 94, at 2--3.)

STANDARD OF REVIEW

Any party may serve and file written objections to proposed findings and recommendations. See 28 U.S.C. § 636(b). Pursuant to Local Rule 74.2, when a party objects to a magistrate judge's dispositive order, findings, or recommendations, the district court must make a de novo determination. A de novoreview means "the court must consider the matter anew, the same as if it had not been heard before and as if no decision previously had been rendered." U.S. Pac. Builders v. Mitsui Trust & Banking Co., 57 F. Supp. 2d 1018, 1024 (D. Haw. 1999) (citation omitted).

"The court may 'accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate.' The court also may receive further evidence or recommit the matter to the magistrate with instructions." McDonnell Douglas Corp. v. Commodore Bus. Machs., Inc., 6 ...


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