Free Reply in Support of Motion - District Court of Arizona - Arizona

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FENNEMORE CRAIG , P.C.
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FENNEMORE CRAIG, P.C. William L. Thorpe (No. 005641) Sal J. Rivera (No. 016728) 3003 North Central Avenue Suite 2600 Phoenix, Arizona 85012-2913 Telephone: (602) 916-5000 [email protected] [email protected] Attorneys for BNSF

UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA Steven Schrum, Plaintiff, v. The Burlington Northern Santa Fe Railway Company, Defendant. The Burlington Northern Santa Fe Railway Company, a corporation, Third Party Plaintiff v. Chemical Lime Company of Arizona, a corporation; ABC Corporations I-IV, fictitious corporations, Third Party Defendants No. CIV04-619-PHX-RCB BNSF'S REPLY IN SUPPORT OF ITS MOTION FOR IN CAMERA REVIEW

Chemical Lime's response to BNSF's motion for in camera review of its itemized statement of attorneys' fees is not persuasive and its request to review BNSF's privileged communications should be denied. As a preliminary matter, the Court should deny

Chemical Lime's novel and unsupported request that the Court not award any fees

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reflected in redacted time entries.

There is no basis for this request.1

The rules

specifically provide that privileged information should be protected in a fee application. See LRCiv 54.2(e)(2)(in describing services counsel should be sensitive to attorney client and attorney work product privileges). The Rules also specifically establish that only the Court should review time entries in certain situations. See e.g., Rule 54.2(d)(3). In short, there is absolutely no support for Chemical Lime's request that it be excused from paying BNSF's attorneys' fees and costs because BNSF redacted certain time entries for reasons permitted by the Rules. BNSF and its attorneys have also provided sufficient information for Chemical Lime to respond to BNSF's comprehensive fee application. BNSF's fee application complies with the Rules. Additionally, BNSF's attorneys have certified that the fees were reasonable and reasonably incurred and have provided two affidavits in support of its
1

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FENNEMORE CRAIG , P.C.
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The cases cited in Chemical Lime's response do not stand for the proposition that redacted time entries will not be awarded by a Court. In fact, C.I.T. Leasing v. Brawmex-Brasil, 2007 WL 840287 actually supports BNSF's position on these issues. See C.I.T. Leasing attached as Exhibit A. There, C.I.T. (the prevailing party) initially submitted redacted invoices for attorneys' fees. Id. at p. 6. The Court requested unredacted copies of Holland & Knight's invoices so that it could conduct an in camera inspection. Id. Pursuant to the in camera inspection, the Judge awarded all fees and costs (approximately $130,000) because it determined that the hourly rate charged was consistent with the timekeeper's experience and market rates, the time charged for specific tasks was reasonable and C.I.T. paid the expenses without questioning them. Id. The court awarded another $350,000 in fees and costs to C.I.T. for services provided by C.I.T.'s Brazilian counsel even though the Court was "obviously" unfamiliar with prevailing rates for legal services in Brazil. Id. The Court did so because C.I.T. paid the Brazilian fees without any assurances that it would be able to recover these fees. Id. The Brazilian firm also initially submitted redacted fees and again the Court requested unredacted for an in camera inspection. Id. The Judge declined to award only the small amount of fees (approximately $2000) that inadvertently remained redacted or for which no explanation of the time was given in spite of the Court's request for unredacted fees. Id. Chip Berry Produce v. Thomas, 2007 WL 2219342 (E.D. Mich. 2007) involved a dispute over $350,000 in attorneys' fees among various plaintiffs asserting claims for fees recovered by a common fund. See Chip Berry attached as Exhibit B. The original plaintiff claimed it was entitled to recover certain fees it incurred on behalf of all plaintiffs. The court found that original plaintiff's counsel's bills were "consolidated such that many actions for which he charged his client are listed as one time entry." Id. at p. 3. The Court simply stated that it would not award additional fees to the original plaintiff for which the time entries were not specific enough to determine if the fees incurred were on behalf of the original plaintiff or all the plaintiffs (because the consolidated entries were vague, not segregated or redacted, etc.). Id. Again, neither of these cases support Chemical Lime's position on these issues.
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FENNEMORE CRAIG , P.C.
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application. Thus, Chemical Lime's argument that BNSF has not provided sufficient information to allow Chemical Lime to make a determination of the reasonableness of BNSF's fees lacks merit. Chemical Lime has fully (albeit misguidedly) responded to BNSF's fee application and will not suffer any prejudice if it is not allowed to review BNSF's privileged communications. Similarly, Chemical Lime has not provided a good reason to require BNSF to waive and disclose privileged communications in its fee application. Again, the Rules provide for Court-only review of attorneys' fees application and protection of privileged information. Contrary to Chemical Lime's conclusory response, this is an appropriate case for such review. Indeed, as set forth in BNSF's motion, there are appeals pending and the hazards associated with requiring BNSF to disclose privileged communications are clear. This is especially true considering that (a) the totality of BNSF's fee application provides sufficient information to award BNSF's fees and costs and (b) the Court can conduct an in camera inspection if it has any questions regarding any portions of BNSF's itemized fee application. BNSF's request for an in camera inspection is also not "belated." BNSF provided sufficient information with its original fee application to allow Chemical Lime to respond to the fee application and the Court to award BNSF's fees and costs. BNSF simply offered to submit the unredacted itemized fee application to the Court to allow the Court to review the unredacted time entries if it was inclined to do so. BNSF's position on this issue is not "belated" and Chemical Lime's suggestion that it has somehow been prejudiced by BNSF's offer to the Court is not well-taken.2 Throughout this litigation, Chemical Lime has offered conflicting and unsupported arguments in response to BNSF's clear right to defense and indemnification. Even now,
2

Chemical Lime's suggestion that it has been prejudiced is ironic considering the fact that the only reason that BNSF is incurring these fees now is because Chemical Lime failed to accept BNSF's tender of defense years ago.
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FENNEMORE CRAIG , P.C.
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Chemical Lime flagrantly contradicts previous statements it made to the Court by stating that "Chemical Lime is aligned with BNSF's interest on [plaintiff's appeal]," when, as noted in the Court's Order granting BNSF's motion for summary judgment, Chemical Lime previously took the position that it was not required to defend and indemnify BNSF because there was a "clear divergence of interests" between Chemical Lime and BNSF. See Court's Order at p. 19, attached as Exhibit C. In short, Chemical Lime's most recent objections simply continue its strategy of employing every possible tactic to avoid its duty to defend BNSF and pay BNSF's reasonable attorneys' fees and costs. The Court should put an end to Chemical Lime's tactics and order Chemical Lime to pay these fees and costs immediately. The Court should also grant BNSF's motion for an in camera inspection if it believes that reviewing the unredacted time entries will assist the Court with its final determination on this issue. DATED this 20th day of August, 2007. FENNEMORE CRAIG, P.C.

By s/Sal J. Rivera Sal J. Rivera William L. Thorpe Attorneys for BNSF

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FENNEMORE CRAIG , P.C.
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CERTIFICATE OF SERVICE I hereby certify that on August 20, 2007, I electronically transmitted the attached document to the Clerk's Office using the CM/ECF System for filing and transmittal of a Notice of Electronic Filing to the following CM/ECF registrants: George T. Brugess Hoey & Farina, P.C. 542 S. Dearborn, Suite 200 Chicago, IL 60605 Attorneys for Plaintiff Charles D. Onofry ReNae A. Nachman Schneider & Onofry, P.C. 3101 N. Central Ave., Ste. 600 Phoenix, AZ 85012 Attorneys for Third-Party Defendant Chemical Lime I hereby certify that on August 20, 2007, I served the attached document by facsimile and U.S. mail on the following, who are not registered participants of the CM/ECF System: William D. Black One East Camelback Road Suite 630 Phoenix, Arizona 85012-1658

s/Mary Boston

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