Free Trial Brief - District Court of California - California

Case 3:07—cv—02952—WHA Document 196 Filed 06/17/2008 Page 1 of 4
1 COX, WOOTTON, GRIFFIN,
HANSEN & POULOS LLP
2 Gregory W. Poulos (SBN 131428)
Max L. Kelley (SBN 205943)
3 190 The Embarcadero .
San Francisco, CA 94105
4 Telephone No.: 415-438-4600
` Facsimile No.: 415-438-4601
5
LAW OFFICES OF RICHARD P. WAGNER
6 Richard P. Wagner (SBN 166792)
700 Oceangate, Suite 700
7 Long Beach, CA 90802
Telephone: (562) 216-2946
8 Facsimile: (562) 216-2960
9 Attorneys for Plaintiff
10 DEL MAR SEAFOODS, INC.
11
12 UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA
13 SAN FRANCISCO DIVISION .
14
15 DEL MAR SEAFOODS, INC. ) Case No.: CV 07-02952 WHA
)
Plaintiff, ) PLAINTIFF’S POST-TRIAL BRIEF
16 ) RE ATT0RNEYs# FEES
vs. )
17 )
BARRY COHEN, CHRIS COHEN (aka )
18 CHRISTENE COHEN), in persomtm and )
F/V POINT LOMA, Official Number )
19 515298, a 1968 steel-hulled, 126-gross ton, ) -
70.8- foot long fishing vessel, her engines, )
20 tackle, furniture, apparel, etc., in rem, and )
Does 1-10, )
21 )
Defendants. )
22 ) Hearing Date: June 16, 2008
) Time: 3:00 p.m.
23 Courtroom 9, 19th Floor
_ 2 Hon. William H. Alsup
24 And Related Counterclaims 3
25 I
26 Plaintiff Del Mar Seafoods, Inc. hereby submits this brief addressing the issue of
‘°}Z.lé'§?éii°1tQl?§’£}i${‘“ 27 att0rneys’ fees raised by the Court.
F/\X·115-l3S~|f10l-
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Case 3:07—cv—02952—WHA Document 196 Filed 06/17/2008 Page 2 of 4
l I. APPLICABLE LAW
1 2 This case involves the foreclosure of a preferred ship mortgage and by way of an in
3 rem action against the defendant vessel, the F/V Point Loma as provided for under The
4 Commercial Instruments and Maritime Liens Act ("CIMLA") (previously titled “The Ship
5 Mortgage Act") 46 U.S.C. § 31301 ei seq., therefore maritime law applies. 46 U.S.C. §
6 31325. Marastro Cornpania Naviera, SA. v. Canadian Mariiime Carriers, Lid., 959 F.2d
7 49, 53 (Sth Cir. 1992) (maritime law controls the substantive law of maritime seizures).
8 Defendant admits that federal maritime law applies and governs. (See, Defendant’s
9 Proposed Findings of Fact and Conclusions of Law, 1147).
10 State laws do not apply to relative to the enforcement of a maritime contract. Union
1] Fish v. Erickson (1919) 248 U.S. 308, 314. Applying state laws would disrupt the need for
I2 national uniformity. As the Court held:
13 If one State may declare such contracts void for one reason, another may do
M likewise for another. Thus the local law of a State may deprive one of relief
in a case brought in a court of admiralty of the United States upon a maritime I
15 contract, and the uniformity of rules governing such contracts may be
16 destroyed by perhaps conflicting rules of the States.
1. Under federal maritime law, the att0rneys’ fees clause in the Note must
17 be enforced.
18 The promissory note (T.E. 7) provides:
19 If suit is commenced on this note, maker [Cohen] shall pay to
20 holder [Del Mar] a reasonable attorney’s fee and all costs.
21 Suit was commenced in by Del Mar on the promissory note and mortgage after
22 defendants failure to make payments required by the promissory note and mortgage.
23 . Defendants have admitted that they owe a balance under the note and most of the case
24 related not to whether they owe plaintiff but how much they owe. The evidence presented at
25 trial proves that the defendants were in default under the Note and Mortgage. Under the [
26 express terms of the Note (T.E. 7, pg. 2, 1[ 5) Plaintiff is entitled to recover its reasonable
27 attorneys’ fees and all costs Hom the Defendants. As noted above, such contractual
28 provisions are enforceable. Crowley American T ranspori, Inc. v. Richard Sewing Machine
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Case 3:07—cv—02952—WHA Document 196 Filed 06/17/2008 Page 3 of 4
A 1 Co., 173 F.3d 781 (1111] Cir. 1999).
2 2. Defendants Are Not Entitled To Any Recovery of Attorneys’ Fees
3 lf, as Dei Mar asserts, it is the prevailing party in this matter the contract provides for
4 Del Mar’s right to recover its attorneys fees. Del Mar’s recovery will, in the first instance,
5 preclude an award of attorneys fees to defendants.
6 Even if, however, Del Mar is not the prevailing party, defendants are still not entitled
7 to recover attorneys’ fees on either the defense of p1aintiff’s action or on the cross-complaint
8 for wrongful arrest.
9 A. Defense of the Plaintiff’ s Action:
10 There is a well—established maritime law providing that contractual provisions for
11 attorneys fees are to be strictly enforced, even y"nnilateral, and state statutes to the
12 contrary are inapplicable.
13 Defendants have asserted two basis for recovery of attorneys’ fees. First, they have
14 claimed that they should be found to be the prevailing party in the plaintiff’ s action, and that
15 the Court should then look to State Law and apply California Civil Code §1717 to interpret
16 the attorneys fees provision in the Promissory Note as reciprocal. This argument fails both
17 because Del Mar, not defendants, should be the prevailing party and because the federal
18 maritime law controls and precludes the application of California Civil Code §1717.
19 ln Crowley American Transport, Inc. v. Richard Sewing Machine Co., 173 F.3d 781,
2Q 785-786 (11th Cir. 1999), the appellate court, applying maritime law, held that a unilateral
2] contractual provision for attorneys’ fees would be enforced. ln Golden Pisces, Inc. v.
22 OneBeacon America Ins. Co., 495 F.3d 1078 1081, 1083-1084 (9m Cir. 2007) The Ninth
23 Circuit found that no maritime rule of reciprocity of attorneys’ fees exists and declined to
Q4 “announce a new equitable maritime exception to the [American] Rule on the basis of
25 ‘reciprocity"’. See also, Sosebee v. Rath, 893 F.2d 54, 56-57 (3d Cir. 1990) (refusing to
26 apply a state statute awarding attorneys’ fees in a case governed by federal maritime law);
`°$ii`ii·i§§ii}'}.I¥i°° 27 Texas A&M Research Foundation v. Versus Magna Transp., Inc., 338 F.3d 394, 405-406, ;
Kmlmgi 28 (S"` Cir. 2003) (same); Garan, Inc. v. M/Vrlivik, 907 F.Supp. 397, 400-401 (S.D.Fla. 1995)
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l (same); see also, Nisscm Fire & Marineilns. Co., Ltd v. B/IX Global Inc., 2006
2 U.S.Dist.LEXIS 30555, 16-19 (in case governed by federal law, refusing to apply Cal. Civ.
3 Code § 1717 to a unilateral contractual provision for attorneys’ fees).
4 B. The Alleged Wrongful Arrest
5 Defendants also argue that they are entitled to an award of attorneys fees based on the
6 wrongful arrest of the vessel. An award of attorneys’ fees for bad faith "requires a high
7 degree of specificity in the factual findings of lower courts . . . on the basis of bad faith.°’
8 Kcmematsu—Gosho Ltcl v. M/T Messiniaki Aigli, 814 F.2d 115, 119 (2d. Cir. 1987) (citation
9 omitted). Furthermore, there must "be ‘clear evidence’ that the claims are ‘entirely without E
10 color and made for reasons of harassment or delay or for other improper purposes."’ {al
11 p (citations omitted).
12 Del Mar contends that the arrest was not undertaken with malice or bad faith and
I3 therefore the Court should decline to find that the arrest was "wrongful.” Moreover, even if
14 the arrest was wrongful, the Court may in its discretion decline to award attorneys fees. If the
I5 Court finds that Plaintiff wrongfully arrested the vessel, (and Plaintiff strongly contends it did
16 i not), defendants should only be entitled to attorneys’ fees directly expended to release the
17 vessel and not for the entirety of the case. _
18
Dated: June 17, 2008 COX, WOOTTON, GRIFFIN,
19 r—1ANsEN a routes, LLP
Attorneys for Plaintiff
20 DEL MAR SEAFOODS, INC.
21
22
23 By: /s/ Gregory Poulos
Gregory W. Poulos ,
24 Max L. Kelley i
25
éiiiltllifililiglh 26
27
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