Oregon Federal District Court Rules on Attorney Fees and Prejudgment Interest

The U.S. District Court for the District of Oregon issued an in-depth opinion on October 1, 2013, about an insured’s entitlement to a reasonable attorney fee and prejudgment interest under Oregon law.  Judge Marco A. Hernandez issued a detailed analysis on both issues in Precision Seed Cleaners v. Country Mutual Ins. Co., U.S. Dist. Court Oregon, Case No. 3:13-cv-01023-HZ.  The lawsuit related to a claim for payment for property and inventory that was destroyed in a fire.  The parties settled the substantive issues concerning allegations of breach of contract prior to trial, leaving only the issues of attorney fees and prejudgment interest.

Judge Hernandez thoroughly analyzed the insured’s claim for attorney fees under ORS 742.061, including addressing the attorneys’ reasonable hourly rate, the reasonableness of the time spent by the attorneys, and whether a lodestar multiplier of 1.5-times the actual fees was appropriate in the case.  In the opinion, the Court addressed several of the factors outlined in ORS 20.075 in assessing the overall reasonableness of the insured’s attorney fee claim.  The Court thoroughly analyzed each attorneys’ hourly rate and the time spent, including assessing whether the attorneys’ time was justified given the circumstances of the case.  Ultimately, the Court reduced the claimed attorney fees and refused to impose a lodestar multiplier.  Judge Hernandez also refused to award the full amount of fees claimed for time spent by an attorney that was retained solely for the purpose of preparing the attorney fee petition, in part because the litigation counsel was qualified to prepare the attorney fee petition.

Additionally, the Court analyzed the imposition of prejudgment interest pursuant to ORS 82.010, which provides for simple interest of nine percent per annum on “[a]ll moneys after they became due.”  The opinion analyzed several aspects of the insured’s claim to determine whether and when the amounts claimed were “ascertainable” so as to trigger prejudgment interest.  Judge Hernandez awarded Plaintiffs some prejudgment interest based on his determination of when the amounts were readily ascertainable, but reduced the overall amount claimed based on the analysis.

A copy of the complete opinion is available here: Precision Seed Cleaners v. Country Mut. Ins. Co., U.S. Dist. Ct., Dist. of Oregon, Case No. 313-cv-01023-HZ.  Both parties have filed motions for reconsideration on the issues addressed in the opinion.  We will follow-up with the Court’s decision on those motions, along with any appeals filed in the case.

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