Lance Toland v. The Phoenix Insurance Company

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 20-12556
Non-Argument Calendar
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D.C. Docket No. 1:16-cv-04236-WMR
LANCE TOLAND,
Plaintiff-Appellant,
versus
THE PHOENIX INSURANCE COMPANY,
Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Northern District of Georgia
________________________
(March 30, 2021)
Before MARTIN, BRANCH, and LAGOA, Circuit Judges.
PER CURIAM:
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Lance Toland sued Phoenix Insurance Company (“Phoenix”) for not
including him as a payee on checks for insurance claims made out to its
policyholder, restaurant group Here to Serve, Inc. (“H2S”). Toland, H2S’s
financial backer, asserted claims for conversion, negligence, constructive trust,
attorneys’ fees, and punitive damages. The district court ultimately granted
summary judgment to Phoenix on all counts and Toland appealed that decision to
this Court. While that appeal was pending, the district court granted Phoenix’s
motion for attorneys’ fees due to Toland’s rejection of a written settlement offer.
Toland now challenges the district court’s award of attorneys’ fees, arguing that it
was premature, that the hearing on the motion was defective, and that Phoenix’s
written settlement offer was defective. After careful review, we affirm the district
court’s decision.
I. BACKGROUND
This appeal arose from a dispute over insurance proceeds that Phoenix paid
to its policy holder, H2S, without including Toland, the group’s financial backer,
as a payee on the checks. On May 30, 2019, Phoenix served on Toland a written
settlement offer of $50,000 made pursuant to O.C.G.A. § 9-11-68.1 Toland did not
1 Toland initially filed suit in the Superior Court of Gwinnett County but Phoenix
removed the suit to the United States District Court for the Northern District of Georgia,
claiming diversity of citizenship with an amount in controversy greater than $75,000.
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respond to the offer, so it was deemed rejected after 30 days. O.C.G.A. § 9-11-
68(c).2
On February 12, 2020, the district court granted summary judgment to
Phoenix on all Toland’s claims. Then, on February 24, 2020, Phoenix moved for
attorneys’ fees and costs. After briefing by both parties, the district court
scheduled a hearing on the attorneys’ fees motion for March 31, 2020. Before the
hearing, Toland appealed the district court’s order granting summary judgment to
Phoenix.
Before the district court’s scheduled hearing on the attorneys’ fees motion,
the United States District Court for the Northern District of Georgia issued General
Order 20-01, which explained that given the COVID-19 pandemic, individual
judges could exercise their discretion to hold hearings in a safe manner. See
General Order 20-01, United States District Court for the Northern District of
2 Any offer made under [O.C.G.A. § 9-11-68] shall remain open for 30 days
unless sooner withdrawn by a writing served on the offeree prior to acceptance by
the offeree, but an offeror shall not be entitled to attorney's fees and costs under
subsection (b) of this Code section to the extent an offer is not open for at least 30
days (unless it is rejected during that 30 day period). A counteroffer shall be
deemed a rejection but may serve as an offer under this Code section if it is
specifically denominated as an offer under [O.C.G.A. § 9-11-68]. Acceptance or
rejection of the offer by the offeree must be in writing and served upon the
offeror. An offer that is neither withdrawn nor accepted within 30 days shall be
deemed rejected. The fact that an offer is made but not accepted does not
preclude a subsequent offer. Evidence of an offer is not admissible except in
proceedings to enforce a settlement or to determine reasonable attorney's fees and
costs under this Code section.
O.C.G.A. § 9-11-68(c).
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Georgia, Mar. 16, 2020,
http://www.gand.uscourts.gov/sites/default/files/NDGA_GeneralOrder20-01.pdf.
Four days after the Northern District of Georgia issued this order, the district court
cancelled the March 31 hearing and announced that it would rule on the motions
based on the written pleadings, but later rescheduled the hearing to June 1, 2020, to
be held via Zoom videoconference.
After the videoconference hearing, the district court granted Phoenix’s
motion for attorneys’ fees and costs. It found that Phoenix’s offer contained all the
elements of a valid settlement offer under O.C.G.A. § 9-11-68(a),3 and that
3 O.C.G.A. § 9-11-68(a) provides:
At any time more than 30 days after the service of a summons and complaint on a
party but not less than 30 days (or 20 days if it is a counteroffer) before trial,
either party may serve upon the other party, but shall not file with the court, a
written offer, denominated as an offer under this Code section, to settle a tort
claim for the money specified in the offer and to enter into an agreement
dismissing the claim or to allow judgment to be entered accordingly. Any offer
under this Code section must:
(1) Be in writing and state that it is being made pursuant to this Code
section;
(2) Identify the party or parties making the proposal and the party or
parties to whom the proposal is being made;
(3) Identify generally the claim or claims the proposal is attempting to
resolve;
(4) State with particularity any relevant conditions;
(5) State the total amount of the proposal;
(6) State with particularity the amount proposed to settle a claim for
punitive damages, if any;
(7) State whether the proposal includes attorney’s fees or other expenses
and whether attorney’s fees or other expenses are part of the legal claim;
and
(8) Include a certificate of service and be served by certified mail or
statutory overnight delivery in the form required by Code Section 9-11-5.
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because Toland rejected the offer by not responding to it and summary judgment
was in Phoenix’s favor on all claims, Phoenix was entitled to an award of
attorneys’ fees and costs pursuant to O.C.G.A. § 9-11-68(b)(1).4 The district court
also held that the motion for attorneys’ fees and costs was timely despite Toland’s
pending appeal of the summary judgment order because the statutory text and this
Court’s precedent indicated that attorneys’ fees motions could still be decided
while an appeal was pending but could not be enforced until after the appeal’s
disposition. Next, the district court rejected Toland’s argument that Phoenix’s
motion was procedurally defective because it did not delineate properly the amount
of the settlement that covered punitive damages, noting that the settlement offer
stated that $50,000 “[was] allocated to settle any claim by the Plaintiff Toland for
punitive damages.” The district court also rejected Toland’s argument that the
settlement offer was not made in good faith, concluding that because summary
judgment was entered in favor of Phoenix on all claims, Phoenix’s offer of $50,000
was reasonable to settle all claims and would have been a windfall to Toland.
Finally, the district court rejected Toland’s argument that Phoenix’s motion was
4 If a defendant makes an offer of settlement which is rejected by the plaintiff, the
defendant shall be entitled to recover reasonable attorney’s fees and expenses of
litigation incurred by the defendant or on the defendant’s behalf from the date of
the rejection of the offer of settlement through the entry of judgment if the final
judgment is one of no liability or the final judgment obtained by the plaintiff is
less than 75 percent of such offer of settlement.
O.C.G.A. § 9-11-68(b)(1).
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defective because it did not specify the amount of time billed for each claim. The
district court explained that because all Toland’s claims were premised on the
same underlying allegation—that Phoenix did not include him as a payee on H2S’s
policy proceed checks—Phoenix did not need to specify which time was spent on
which claim. Based on these conclusions, the district court granted Phoenix’s
motion but stayed enforcement pending the resolution of Toland’s appeal of the
summary judgment order.
II. STANDARD OF REVIEW
“We review a district court’s award of attorneys’ fees for abuse of
discretion.” Waters v. Int’l Precious Metals Corp., 190 F.3d 1291, 1293 (11th Cir.
1999). The district court “has great latitude in formulating attorney’s fees awards
subject only to the necessity of explaining its reasoning so that we can undertake
our review.” McKenzie v. Cooper, Levins & Pastko, Inc., 990 F.2d 1183, 1184
(11th Cir. 1993) (quotation omitted). “[W]hen employing an abuse-of-discretion
standard, we must affirm unless we find that the district court has made a clear
error of judgment or applied the wrong legal standard.” United States v. Frazier,
387 F.3d 1244, 1259 (11th Cir. 2004) (en banc).5
5 Toland asserts that we should apply de novo review, and cites Esfield v. Costa
Crociere, S.P.A., 289 F.3d 1300, 1306 (11th Cir. 2002), and Shaps v. Provident Life & Accident
Ins. Co., 244 F.3d 876, 881 (11th Cir. 2001), as support. However, neither case applies de novo
review to attorneys’ fees awards. In Esfield, we applied de novo review to the question of
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III. DISCUSSION
A. The attorneys’ fees award was not premature.
Toland argues that the district court’s award of attorneys’ fees to Phoenix
was premature because his appeal of the summary judgment order was still
pending before this Court and O.C.G.A. § 9-11-68(d) forbids an award of
attorneys’ fees until all appeals are exhausted. O.C.G.A. § 9-11-68(d)(1) provides
that:
The [trial] court shall order the payment of attorney’s fees and
expenses of litigation upon receipt of proof that the judgment is one
[in] which [the plaintiff rejected the defendant’s settlement offer and
the defendant obtained a final judgment of no liability or a final
judgment in which plaintiff obtained a judgment 75% less than the
amount of the settlement offer] or [the defendant rejected the
plaintiff’s settlement offer and the plaintiff recovers a final judgment
greater than 125% of the settlement offer]; provided, however, that if
an appeal is taken from such judgment, the court shall order payment
of such attorney’s fees and expenses of litigation only upon remittitur
affirming such judgment.
(emphasis added). This section applies here because Toland rejected Phoenix’s
offer of settlement by not responding within 30 days and because Phoenix obtained
a final judgment of no liability. The plain language prohibits a trial court from
ordering payment until its judgment is affirmed but does not bar the parties from
filing attorneys’ fees motions or preclude the court from ruling on them while the
whether state or federal forum non conveniens law applied in federal diversity cases. 289 F.3d at
1306. And in Shaps, we applied de novo review to a choice-of-law question. 244 F.3d at 881.
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appeal from the final judgment is still pending. Thus, the district court did not
abuse its discretion by deciding an attorneys’ fees motion but ordering that
payment would not be due until Toland’s appeal was resolved.6
B. Toland was not denied a hearing.
Toland argues that the district court denied him the required hearing on
Phoenix’s motion for attorneys’ fees because: (1) the hearing was conducted via
videoconference, which deprived him of his right to be in the same location as the
witnesses and documents;7 and (2) the district court did not permit him to conduct
discovery prior to the hearing.8 Under Georgia law, “[a] hearing on a request for
attorney fees is required ‘so that the party opposing fees has an opportunity to
confront and challenge whether the fees a party is entitled to under OCGA § 9-11-
6 Toland cites three cases to support his position that the motion was premature, but none
of them is controlling or on-point. Two of those cases, Hall v. 84 Lumber Co., No. CV409–057,
2012 WL 1058875, at *1 (S.D. Ga. Mar. 28, 2012) and Wheatley v. Moe’s Southwest Grill, 580
F.Supp.2d 1324, 1325 (N.D. Ga. 2008), do not address the question of whether ruling on a
motion for attorneys’ fees under O.C.G.A. § 9-11-68 is premature if an appeal is pending. The
third case, Abdalla v. Atlanta Nephrology Referral Center, 789 S.E.2d 288 (Ga. App. 2016),
holds that an award of attorneys’ fees was premature until the parties finished arbitrating a
portion of their claims because “[u]ntil we know the outcome of the arbitration proceeding with a
judgment certain, we do not have proof that [O.C.G.A. § 9-11-68(d)(1)] applies; thus any award
at this stage is premature.” Id. at 291. Because Abdalla dealt with arbitration proceedings, it
does not affect the outcome here.
7 Toland raised this issue before the district court during the hearing on the attorneys’
fees and costs motion.
8 Toland also argues that the hearing was insufficient because “the district court did not
permit [Toland] to inquire in to [sic] various aspects necessary for a full examination of
[Phoenix’s] fee request.” To the extent this is a separate argument from Toland’s argument that
he was denied discovery, he did not raise it below, and it is thus forfeited. See Baldwin v. Blue
Cross/Blue Shield of Ala., 480 F.3d 1287, 1308 n.2 (11th Cir. 2007) (“We do not ordinarily
consider arguments raised for the first time on appeal.”) (citation omitted).
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68 (b), are reasonable, and, if raised, to shoulder its burden to prove the absence of
good faith.’” Hillman v. Bord, 820 S.E.2d 482, 489 (Ga. App. 2018) (quoting
Richardson v. Locklyn, 793 S.E.2d 640, 644 (Ga. App. 2016)). In support of his
argument that the hearing was deficient, Toland cites Federal Rule of Civil
Procedure 43, which provides that:
[a]t trial, the witnesses’ testimony must be taken in open court unless
a federal statute, the Federal Rules of Evidence, these rules, or other
rules adopted by the Supreme Court provide otherwise. For good
cause in compelling circumstances and with appropriate safeguards,
the court may permit testimony in open court by contemporaneous
transmission from a different location.
The plain language of the rule gives the district court “discretion to allow live
testimony by video for ‘good cause in compelling circumstances and with
appropriate safeguards.’” Thomas v. Anderson, 912 F.3d 971, 977 (7th Cir. 2018),
cert. denied, 140 S. Ct. 533 (2019) (quotation omitted). Here, the district court
cancelled the original, in-person hearing four days after the Northern District of
Georgia issued an order giving judges permission to conduct hearings remotely due
to the Covid-19 global pandemic. The district court’s decision to hold the hearing
via videoconference in light of the pandemic was within its discretion under Rule
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43.9 Toland has presented no evidence that the district court abused its discretion
in making that decision.10
Toland also argues that the district court should have granted him discovery
prior to the hearing. But he did not file a request for discovery, and the only time
he mentioned the issue before the district court was in a single paragraph in his
response brief in opposition to Phoenix’s motion for attorneys’ fees. The Northern
District of Georgia’s local rules require that “[e]very motion presented to the clerk
for filing shall be accompanied by a memorandum of law which cites supporting
authority.” N.D. Ga. R. 7.1(A)(1). Toland did not file a motion or a supporting
memorandum of law, and thus he did not properly request discovery. We also note
that Toland does not explain in his response brief below or in his briefing before
this Court how he was prejudiced by not receiving an opportunity to conduct
9 Toland also cites Ahmed v. Kifle, 2015 WL 11182483 at *3 (N.D. Ga. June 16, 2015),
where the district court held that the defendant had not established “good cause or compelling
circumstances” under Rule 43 for his witnesses to testify telephonically or via videoconference.
Ahmed, however, is inapposite. As an initial matter, we note that Ahmed is not binding on this
Court. Further, the circumstances in Ahmed are distinguishable from those here. First, there was
not an ongoing global pandemic in Ahmed that required courts to adjust hearing formats when
possible to ensure the safety of court personnel and parties. Second, Ahmed deals with a district
court finding no good cause, and thus it does not speak to our abuse-of-discretion review.
10 We also note that at the hearing, the only witness Toland questioned was Phoenix’s
counsel, Karen Karabinos. And, after Toland cross-examined Karabinos, the district court asked
him if there was “some question that you wanted to ask Ms. Karabinos that you couldn’t ask
because of Zoom?” and Toland answered “No.” Toland also did not mention at the hearing that
his access to the relevant documents was hampered by the format of the hearing. Thus, the
record does not support Toland’s assertion that he was “denied a full hearing” due to limited
access to witnesses or documentary evidence.
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discovery prior to the hearing on the motion for attorneys’ fees. He also does not
cite any authority that indicates that a district court is required to grant discovery
before deciding a motion for attorneys’ fees. For these reasons, Toland’s argument
that he was denied a proper hearing because he was not granted discovery prior to
the hearing fails.
C. Neither Phoenix’s offer of settlement nor its motion for attorneys’ fees
was procedurally defective.
Toland also argues that Phoenix’s motion for attorneys’ fees should have
been denied because it was based on a procedurally defective settlement offer and
the motion itself was procedurally defective. Specifically, he argues that the
motion was based on a procedurally defective settlement offer because the offer
(1) did not identify “with particularity” the amount proposed to settle Toland’s
punitive damages claim; and (2) was not made in good faith. Additionally, he
argues that the motion for attorneys’ fees was procedurally defective because it did
not “delineate between non-recoverable claims as required by the statute and fails
to provide information sufficient to determine if such amounts claims are
‘reasonable.’” All three arguments are meritless.
Contrary to Toland’s first assertion, the settlement offer stated that $50,000
“is allocated to settle any claim by [Toland] for punitive damages.” Thus, Phoenix
complied with O.C.G.A. 9-11-68(a)(6)’s requirement that settlement offers “state
with particularity the amount proposed to settle a claim for punitive damages, if
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any.” See also Chadwick v. Brazell, 771 S.E.2d 75, 78–79 (Ga. App. 2015)
(explaining that per the statute’s plain language, if any settlement amount is
attributable to a punitive-damages claim, the amount must be stated with
particularity).11
Next, Toland argues that the settlement offer was not made in good faith
because it was for $50,000, which Toland says was “approximately 5.8%” of his
requested compensatory damages. Under Georgia law, a settlement offer is not
made in good faith if, among other factors, it bears no reasonable relationship to
the amount of damages or a realistic assessment of liability or there is evidence
that the offeror lacked intent to settle the claim. Richardson, 793 S.E.2d at 643.
Here, Toland has not identified any evidence that the offer was made without
intent to settle, and the evidence in the record suggests that Phoenix’s offer of
$50,000 bore a reasonable relationship to the amount of damages, given Phoenix’s
assessment of liability at the time the offer was made. Phoenix argued throughout
the proceedings that Toland’s recovery, if any, was limited to the worth of the
11 Toland argues that because $50,000 was offered to settle all claims, it cannot also be
the specific amount articulated with particularity to settle his punitive damages claim.
Essentially, Toland wants us to find that “with particularity” means we should require parties to
subdivide the overall settlement amount into discrete amounts for each claim. The plain
language of the statute does not require this outcome. In fact, it only requires that a settlement
offer state two sums with particularity: the overall settlement offer and the amount attributable to
punitive damages. O.C.G.A. § 9-11-68(a)(5); (8). Toland does not cite any case where a
Georgia court has interpreted O.C.G.A. § 9-11-68(a)(8) to require a breakdown of the overall
settlement amount into subtotals for each claim and we decline to do so here.
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business personal property that was stolen or vandalized from the restaurants that
were covered by the Phoenix insurance policy. Toland’s testimony during
discovery and financial documents presented to the district court during a hearing
indicated that the value of the property stolen or vandalized that Toland could
establish a security interest in was less than $1,000. Toland has not pointed to any
evidence in his briefing to dispute that amount. Thus, the district court did not err
in finding that Phoenix’s offer to settle was made in good faith.
Finally, Toland argues that Phoenix’s motion for attorneys’ fees itself was
defective because it did not explain which of Toland’s claims Phoenix’s attorneys
were working on when they billed their time and his complaint contained both tort
and non-tort claims.12 He maintains that O.C.G.A. § 9-11-68 only permits
recovery of fees for tort claims, and, therefore, Phoenix was required to specify
what fees were associated with each claim.
Toland cites Canton Plaza, Inc. v. Regions Bank, Inc., 749 S.E.2d 825, 826–
27 (Ga. App. 2013) to support this proposition. But in that case, the Court of
Appeals of Georgia found that the defendant should have separated out the time it
spent pursuing its counterclaims from defending against plaintiffs’ claims, not that
12 Toland also raises two other issues with Phoenix’s attorneys’ timekeeping: he says
they improperly included time entries for work performed by paralegals and time spent by
attorneys performing duplicative work. Toland raises these arguments for the first time on
appeal, so we will not consider them. See Baldwin, 480 F.3d at 1308 n.2 (“We do not ordinarily
consider arguments raised for the first time on appeal.”) (citation omitted).
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the defendant should have separated out the time it spent defending against
plaintiffs’ tort claim and their breach-of-contract claim. Id. at 827–28. In fact, the
court found that the defendant was not required to separate out time billed on
defending against the plaintiffs’ tort claims versus the non-tort claims because the
claims arose from the same events and counsel was “required to perform the same
tasks to prepare and present its defense at trial, irrespective of the specific claims
asserted by the plaintiffs.” Id. at 827. The same rationale applies here. Toland’s
claims were all based on the same underlying allegations, which meant that
Phoenix’s attorneys had to perform the same tasks to defend against all the claims
at trial. Thus, Toland’s argument that Phoenix’s attorneys’ fees motion was
procedurally defective because it failed delineate what work was performed on
specific claims is also without merit.
* * *
For these reasons, we affirm.
AFFIRMED.
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