SCREEN ACTORS GUILD - AMERICAN FEDERATION OF TELEVISION AND RADIO ARTISTS, AFL-CIO v. SHERIDAN BROADCASTING NETWORKS

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF PENNSYLVANIA

SCREEN ACTORS GUILD — AMERICAN )

FEDERATION OF TELEVISION AND )

RADIO ARTISTS, AFL-CIO, ) Civil Action No. 18-455

) Magistrate Judge Maureen P. Kelly

Plaintiff, )

)

V. ) Re: ECF No. 58

)

SHERIDAN BROADCASTING )

NETWORKS, SHERIDAN )

BROADCASTING CORPORATION, )

RONALD DAVENPORT, JR., and RONALD _ )

DAVENPORT, SR., )

)

Defendants. )

OPINION AND ORDER

KELLY, Magistrate Judge

Presently before the Court is the Motion for Attorneys’ Fees and Punitive Damages (the

“Motion”) filed by Plaintiff Screen Actors Guild-American Federation of Television and Radio

Artists, AFL-CIO, (referred to as the “Union”). ECF No. 58.) Defendants Sheridan

Broadcasting Networks, Sheridan Broadcasting Corporation, Ronald Davenport, Jr. and Ronald

Davenport, Sr. (referred to collectively as the “Defendants”) have filed a Response in Opposition

to Plaintiff's Motion for Punitive Damages and Attorneys’ Fees. ECF No. 60. The instant

Motion is now ripe for consideration.

I, FACTUAL BACKGROUND AND PROCEDURAL HISTORY □

The Union brought this action on behalf of regular full-time and part-time newspersons,

audio journalists, and producers formerly employed by Sheridan Broadcasting Networks

' The Union’s filing captioned “Plaintiffs Brief in Support of its Motion for Punitive Damages and Attorneys’ Fees,”

ECF No. 58, is, in fact, the Union’s combined motion and brief. As such, it will be referred to as the “Motion.”

(“SBN”), in an effort to obtain earned unpaid wages, unreimbursed expenses and related

damages deemed owing in an arbitration filed against SBN. The Union alleged liability pursuant

_ to the Labor Management Relations Act of 1947, as amended (“LMRA”), 29 U.S.C. § 185(c), □

and asserted state law claims against Defendants SBN, Sheridan Broadcasting Corporation

(“SBC”), Ronald Davenport, Jr., and Ronald Davenport, Sr. (the individual Davenport

Defendants shall be referred to collectively as the “Davenport Defendants”). ECF No. 1.

Specifically, the Union brought claims against SBN, its alter ego SBC, and the Davenport

Defendants for (1) breach of contract arising out of Defendants’ failure to comply with a

collective bargaining agreement requirement to remit payment ordered pursuant to a properly

entered arbitration award (Count J), (2) a claim for unpaid wages pursuant to the Pennsylvania

Wage Payment and Collection Law (““WPCL”), 43 Pa. Cons. Stat. § 260 et seg., (Count II), and

(3) a claim for conversion of Union dues deducted from employee wages but never remitted to

— AFTRA (Count II), Id. Although SBN admitted both liability and damages in the

arbitration proceeding, Defendants filed an Answer in this case denying liability. ECF No, 7.

The Union previously filed a Motion for Judgment on the Pleadings, ECF No. 38,

requesting that this Court enter judgment in its favor as a matter of law pursuant to Rule 12(c) of

the Federal Rules of Civil Procedure, and against each of the named Defendants. In the Motion

for Judgment on the Pleadings, the Union claimed damages awarded in arbitration for mneaiel

wages, unpaid severance pay, pay due in lieu of written notice of termination, failure to

implement a wage increase, failure to reimburse expenses, and failure to remit union dues

withheld from employee paychecks.

Defendants filed their brief in opposition to the motion, ECF No. 43. SBN/SBC

conceded liability for all sums in awarded in arbitration and the Davenport Defendants conceded

their personal responsibility for sums due and owing in the course of this litigation.

Upon review, the Court granted the Union’s Motion for Judgment on the Pleadings as to

the breach of contract claims, the Pennsylvania Wage Payment and Collection Law claim, and

the conversion claim. ECF No. 45. As such, the Court found that the Union was entitled to the

damages claimed and awarded damages as set forth below.

wraps and voices produced during August 2017

Id. at 17. Accordingly, the Court found in favor of the Union and against Defendants Sheridan

Broadcasting Networks, Sheridan Broadcasting Corporation, Ronald Davenport, Jr., and Ronald

Davenport, Sr., and awarded a total of $325,827.64 in damages. Id. at 18.

The Union also sought punitive damages as well as attorney’s fees and costs, which the

Court held would be considered separately upon motion filed in support thereof. The Court set

the deadline for the filing of such a motion. Thereafter, the Union filed the instant Motion on

July 8, 2019. ECF No. 58. Defendants filed a Response in Opposition on July 24, 2019. ECF No.

60.

II. ATTORNEYS’ FEES

In the instant Motion, as the prevailing party on the Pennsylvania WPCL claim, the

Union seeks to be awarded a total of $50,994.16 in attorneys’ fees and costs, consisting of

$45,262.50 for legal services provided by Attorney Peter Demkovitz, $3,780.00 in legal services

provided by Attorney Jonathan Walters, and an award of $1,951.66 for attorneys’ costs and

expenses. ECF No. 58 at 7.

_ In support of the instant Motion, the Union asserts that the reasonable hourly rate for

Attorney Demkovitz is $375.00 per hour, and for Attorney Walters is $450.00 per hour. ECF No.

58-1. The Union has submitted the affidavit of Attorney Walters, id. at 1-4, and the statement of

professional services, with an itemized breakdown of legal services rendered. Id. at 5-8.

In the Response in Opposition, Defendants “do not take issue with the hourly rate or the

invoice provided by the Plaintiffs.” ECF No. 60 at 6. However, Defendants argue that an award

of attorneys’ fees should be limited to legal fees arising out of the WPCL claim. Id. As such,

Defendants argue that of the $325,827.24 that this Court awarded, only $237,758.18 is

attributable to the wage claim, which equates to 72.97% of the judgment amount. Id. Defendants

argue that this percentage should be applied to the total amount of Roney fees incurred and

request that the Court award the reduced amount of $37,210.44 (72.97% multiplied by $50,

994.16).?

The Union stated in its Motion that it is seeking “attorneys’ fees under the WPCL....”

ECF No. 58 at 3. An award of attorney fees to the prevailing employee in action brought under

the WPCL is mandatory. See 43 Pa. Cons. Stat. §§ 260.1-260.11; 260.9a(f). The WPCL

2 The Union did not file a reply in opposition to Defendants’ argument for an adjustment.

provides, inter alia, that “[t]he court in any action brought under this section shall, in addition to

any judgment awarded to the plaintiff or plaintiffs, allow costs for remonanie attorneys’ fees of

any nature to be paid by the defendant.” 43 Pa. Cons, Stat. § 260.9a(f).

Here, the Court granted the Union’s Motion for Judgment on the Pleadings as to the

WPCL claim, as well as to its claims for breach of contract and conversion. ECF No. 45. As

such, the Union is clearly entitled to an award of attorneys’ fees. See Oberneder v. Link

Computer Corp., 696 A.2d 148, 151 (Pa. 1997) (“[A]n award of attorneys’ fees to a prevailing

employee in an action brought under the [WPCL] is mandatory.”). However, the WPCL “only

mandates an award of reasonable attorneys’ fees. Courts retain discretion to determine the

amount of the fees owed.” Id., 696 A.2d at 151 n.4 (citing 43 Pa. Cons. Stat. § 260.9a(f)).

In determining an award of attorneys’ fees under the WPCL, “[t]he most useful starting

point for determining the amount of a reasonable fee is the number of hours reasonably expended

on the litigation multiplied by a reasonable hourly rate.” Hensley v. Eckerhart, 461 U.S. 424, 433

(1983). The party seeking the attorneys’ fees has the burden to prove that the requested amount

is reasonable, which requires the party petitioning for the fee to “submit evidence supporting the

hours worked and rates claimed.” Rode v. Dellarciprete, 892 F.2d 1177, 1183 (3d Cir. 1990)

(quoting Hensley, 461 U.S. at 433).

The fee petition must be detailed and specific enough for the district court to determine

whether the hours claimed are reasonable given the work performed and should contain, “some

fairly definite information as to the hours devoted to various general activities, ¢.g., pretrial

‘discovery, settlement negotiations, and the hours spent by various classes of attorneys, e.g.,

senior partners, junior partners, associates.” Rode, 892 F.2d at 1190 (quoting Lindy Bros.

Builders, Inc. of Phila. v. American Radiator & Standard Sanatory Corp., 487 F.2d 161, 167 (3d

Cir. 1973)). An hourly rate is reasonable if the fee applicant demonstrates by evidence

supplementing the applicant’s affidavit that the suggested rate is comparable to the “rates

prevailing in the community for similar services by lawyers of reasonably comparable skill,

experience, and reputation.” Maldonado v. Houstoun, 256 F.3d 181, 184 (3d Cir. 2001) (quoting

Rode, 892 F.2d at 1183). As discussed above, Defendants have not challenged the claimed

hourly rate by the Union’s attorneys. Accordingly, the Court finds that the claimed hourly rates

. for Attorneys Demkovitz and Walters are reasonable.

In reviewing the hours claimed: by the Union, the Court must “decide whether the hours

set out were reasonably expended for each of the particular purposes described and then exclude

those that are ‘excessive, redundant, or otherwise unnecessary.’” Pub. Interest Research Grp. of

v. Windall, 51 F.3d 1179, 1188 (3d Cir. 1995) (quoting Hensley, 461 U.S. at 434).

Defendants have not objected to any of the specific hours claimed in Union’s fee petition or

attempted to point out excessive, redundant, or otherwise unnecessary hours expended for the

work performed. Therefore, the Court will not make any modifications to the fee petition based

on the hours expended. The attorney time expended appears to be reasonable and necessary.

However, Defendants argue that the requested attorneys’ fees should be limited to the

fees related to one of the three claims in the Complaint because the remaining two claims are

unrelated to the WPCL claim. ECF No. 60 at 6. Defendants asserts that the sole basis for

statutorily authorized attorney fees in this case is the Union’s success on its WPCL claim. Thus,

while the Union included in its Motion an attorneys’ fees amount reflecting the work performed

on all claims, ECF No. 58 at 4-7, Defendants argue that the attorneys’ fees should be reduced to

reflect the work attributable to the WPCL claim only. ECF No. 60 at 6. “This type of objection to

an award of fees more typically arises in cases where a plaintiff brings several claims covered by

a fee-shifting statute, such as 42 U.S.C. § 1988, and is successful on some but not all of the

claims” Bair v. Purcell, No. 1:04-CV—1357, 2010 WL 3282653, at *4 (M.D. Pa. August 17,

2010). In such a situation, the United States Supreme Court has held that a district court must.

analyze the interrelatedness of the claims in a case in order to determine the appropriate amount

of attorneys’ fees. Hensley, 461 U.S. at 434-35. (noting that some cases require “unrelated

claims be treated as if they had been raised in separate lawsuits, and therefore no fee may be

awarded for services on the unsuccessful claim,” while other cases “involve a common core of

or will be based on related legal theories,” in which case, the “district court should focus on

the significance of the overall relief obtained by the plaintiff in relation to the hours reasonably

expended on the litigation.”).

In the instant case, the Union was successful on three claims, of which only the WPCL

claim entitles them to an award of attorneys’ fees. In such instances, the United States Court of

Appeals for the Third Circuit has held that a district court should still use the interrelatedness

analysis in determining whether the amount of awarded attorneys’ fees should include the work

done on claims which do not qualify for statutorily authorized attorneys’ fees. Williams v. Tri-

County Growers, Inc., 747 F.2d 121, 137-38 (3d Cir. 1984) (abrogated on other grounds by

Pullman-Standard v. Swint, 456 U.S. 273, 287 (1982)). The Third Circuit explained that “there

is no precise rule or formula for determining the amount of lawyers’ services spent on claims

raised under different statutes. In such situations, the district court may attempt to identify

specific hours that should be eliminated, or it may simply reduce the award to account for the

limited success.” Id. (internal quotations omitted).

Here, it is apparent based on the Court’s review of the filings, that the WPCL, the LMRA

and the conversion claims are clearly interrelated because all of them arise from the failure of

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Defendants to pay the Union members earned unpaid wages, wage increases and severance, as

- well as Defendants’ withholding Union members’ wages for Union dues but not remitting them

.to the Union as required. As such, the claims arise from a common core of facts. The

significance of the overall relief obtained by the Union is readily apparent. Simply put, all of the

claims relate to Defendants’ refusal pay Union members that were due and owed, including the

refusal to remit wages that were withheld for Union dues. The Union’s claim for unpaid

_ Teimbursement of members” expenses is movexcentiog Section 260.2a of the WPCL defines

wages to include “fringe benefits or wage supplements.” 43 Pa. Cons. Stat. § 260.5(a)(1992).

Fringe benefits or wage supplements are, in turn, defined to include “reimbursement for

expenses ... and any other amount to be paid pursuant to agreement to the employee, a third

- party or fund for the benefit of employees.” Id. See Edelman v. Source Healthcare Analytics,

LLC, 265 F. Supp. 3d 534, 541 (E.D. Pa. 2017). Under these circumstances, the Union is

entitled to recover all legal fees.

Based on this Court’s findings relative to the interrelatedness of the claims, the Court will

award the Union all of the attorneys’ fees requested in the amount of $49,042.50, and costs

incurred in the amount of $1951.66. □

Il. PUNITIVE DAMAGES

The Union seeks punitive damages for its common law conversion claim. ECF No. 50 at

3. The underlying conversion claim is based on Pennsylvania common law; therefore,

Pennsylvania substantive law will determine whether punitive damages will be permitted in this

case. Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78 (1938); Gasperini v. Ctr. for Humanities, Inc.,

518 U.S. 415, 427 (1996).

Under Pennsylvania law, punitive damages are proper “only in cases where the

defendant’s actions are so outrageous as to demonstrate willful, wanton or reckless conduct.”

Hutchison ex rel. Hutchison v. Luddy, 870 A.2d 766, 770 (Pa. 2005). “[W]hen assessing the

propriety of the imposition of punitive damages, the state of mind of the actor is vital.” Id.

(internal quotations omitted). “Thus, in Pennsylvania, a punitive damages claim must be

_ supported by evidence sufficient to. establish that (1) a defendant had a subjective appreciation of

the risk of harm to which the plaintiff was exposed and that (2) he acted, or failed to act, as the

case may be, in conscious disregard of that risk.”” Hutchinson, 870 A.2d at 772 (citation omitted).

Here, the Union argues that it “should be awarded punitive damages in an amount up to

the discretion of the court” because “the harm was no mere accident but a deliberate scheme to

divert funds.” ECF No. 58 at 4. Defendants respond that punitive.damages are not appropriate in

this case because “there was neither a usurpation of funds nor malicious intent, but rather poor

economic circumstances.” ECF No. 60 at 3-6. Defendants attached several exhibits to their

Response including a Chapter 11 Bankruptcy filing of Sheridan Broadcasting Networks, Inc.,

and copies of dockets showing that the Defendants were engaged in other litigation concerning

their financial difficulties. See ECF Nos. 60-1, 60-2, 60-3, 60-4. The Defendants assert that these

facts “demonstrate[] that it was not a willful evasion by the Defendants of their payment

obligations, rather it was a business failure which lead to their inability to pay.” ECF No. 60 at 5.

Although the conduct of Defendants is disconcerting to say the least, the Union has not

established any facts substantially refuting Defendants’ assertion that the failure to pay wages

was the result of poor management and business decisions, and not willful or wanton so as to

merit an award of punitive damages in this case. Because the Union’s unsupported statement

that “the harm was no mere accident but a deliberate scheme to divert funds,” standing alone is

:

insufficient as a matter of law to support its claim, the Union’s Motion seeking an award of

punitive damages is denied. -

IV. CONCLUSION

For the reasons stated herein, the Court grants in part and denies in part the Union’s

Motion for Attorney Fees and Punitive Damages. ECF No. 58. The Court grants the Plaintiff's

Motion for Attorneys’ Fees and awards Plaintiff attorneys’ fees in the amount of $49,042.50 and

costs in the amount of $1951.66, for a total award of fees and costs of $50,994.16, to be paid by

Defendants Sheridan Broadcasting Networks, Sheridan Broadcasting Corporation, Ronald

Davenport, Jr. and Ronald Davenport, Sr. Plaintiff's Motion for Punitive Damages is denied.

An appropriate Order follows.

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ORDER

AND NOW, this bb day of October, 2019, upon consideration of Plaintiff's Motion for

Attorney Fees and Punitive Damages, ECF No. 58, and the Defendants’ Response in Opposition

thereto, ECF No. 60, and for the reasons set forth in the accompanying Opinion,

IT IS HEREBY ORDERED that Plaintiff's Motion is GRANTED IS PART AND

DENIED IN PART as follows:

(1) Plaintiff is awarded attorneys’ fees and cost in the amount of $50,994.16 to be paid

by Defendants Sheridan Broadcasting Networks, Sheridan Broadcasting Corporation,

~ Ronald Davenport, Jr. and Ronald Davenport, Sr., to be paid within seven (7) days of

the date of this Order; and,

(2) Plaintiff's Motion for Punitive Damages is denied.

BY THE COURT:

Uy, WC

YEH

JA WWAWs KIRK A

MAUREEN P.(KEZLY

UNITEB.STATES MAGISTRATE JUDGE

cc: All counsel of record via CM/ECF

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