Hendricks v. Alum Financial, LLC

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IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO
KATHARINE H. HENDRICKS,
Plaintiff,
v. No. 21-cv-00798 MV/JFR
ALUM FINANCIAL, LLC, and
DEBT PAY PRO,
Defendants.
MAGISTRATE JUDGE’S PROPOSED FINDINGS
AND RECOMMENDED DISPOSITION1
THIS MATTER is before the Court on the Motion for Attorney Fees as a Sanction, filed
by Plaintiff Katharine H. Hendricks (“Plaintiff”) on December 8, 2025. Doc. 99; see also Doc.
100 (Supplemental Brief Regarding Attorney Fees as a Sanction). Although Defendant Alum
Financial, LLC (“Defendant Alum”2) initially failed to timely respond, the Court sua sponte reset
the Response and Reply deadlines, Doc. 102, after counsel entered an appearance for Defendant
Alum on January 9, 2026, Doc. 101. Accordingly, Defendant Alum responded on January 26,
2026, Doc. 104, and Plaintiff replied on February 5, 2026, Doc. 105.
The undersigned, having reviewed the record and relevant law, RECOMMENDS that
Plaintiff’s Motion for Attorney Fees as a Sanction (Doc. 99) be GRANTED IN PART.
1 In accordance with 28 U.S.C. §§ 636(b)(1)(B), (b)(3), and Va. Beach Fed. Sav. & Loan Ass’n v. Wood, 901 F.2d 849
(10th Cir. 1990), United States District Judge Martha Vázquez referred Plaintiff’s Motion for Attorney Fees as a
Sanction (Doc. 99) on January 13, 2026, to the undersigned to conduct hearings, if warranted, including evidentiary
hearings, and to perform any legal analysis required to recommend to the Court an ultimate disposition. Doc. 103.
2 To clarify, the Court will refer to Alum Financial, LLC as “Defendant Alum” with respect to its participation in this
matter, and as the “LLC” with respect to its general existence as an entity.
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Specifically, the undersigned recommends holding Defendant Alum, Jody “Joe” Burwell,3 and
Andrew Burwell jointly and severally liable for $10,600.00 in attorney’s fees and $867.88 in
New Mexico Gross Receipts Tax as a compensatory sanction pursuant to the Court’s inherent
authority.
I. RELEVANT FACTUAL BACKGROUND
A. The Facts Underlying This Case
As alleged in the Second Amended Class Action Complaint for Damages, Declaratory
Relief and Injunctive Relief (Doc. 36), this case arises from a loan dispute regarding Plaintiff’s
eligibility for loan payment forgiveness under a federal program by virtue of her work as a
mental health care professional employed by a nonprofit organization serving Native American
communities in Northern New Mexico. Doc. 36 at 2 ¶ 6. After applying to the Public Service
Loan Forgiveness Program by fax to the United States Department of Education, Plaintiff began
receiving voicemails in late February or early March 2021, see id. at 3 ¶ 9-10, 14, from
Defendant Alum, id. at 3 ¶ 14, which represented itself as the agency that people must work
through to qualify for federal loan consolidation programs, id. at 3-4 ¶ 15. As a result of
Defendant Alum’s representations, Plaintiff signed a contract believing it was necessary to obtain
the debt relief she sought through the consolidation program. See id. at 4 ¶¶ 16-17, 21-22.
However, Defendant Alum was not an agency that applicants must use to qualify for
federal student loan consolidation programs, nor was the payment plan offered to Plaintiff a
student loan payment plan. Id. at ¶ 18; see also id. at 5 ¶ 25. Rather, it was a plan for payment
3 The record refers to this individual by two names. At his deposition, Andrew Burwell identified the other officer of
Alum Financial LLC as “Jody Burwell, [his] father.” Doc. 100 at 9 (Ex. A (Deposition Transcript) at 5:11-14).
Plaintiff’s counsel likewise identified him as Jody “Joe” Burwell in the Certificate of Service on the Supplemental
Brief. Doc. 100 at 5. The Statement of Information filed with the California Secretary of State, however, listed the
LLC member as “Joe Burwell,” Doc. 105-1, and Defendant Alum’s own Response also uses “Joe Burwell,” Doc. 104.
The Court uses the name “Jody,” except as quoted or referring to which name was listed on forms.
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of Defendant Alum’s own fees. Id. at 5 ¶ 25. Defendant Alum collected fees from Plaintiff
before providing any benefit to Plaintiff and before Plaintiff was enrolled in a qualified loan
consolidation and forgiveness plan. Id. at 4 ¶ 20. Despite the language of the contract
“authoriz[ing] [Defendant Alum] to charge [Plaintiff’s] account . . . for the sole purpose of [her]
student loans,” id. at 5 ¶ 24, Defendant Alum kept all the funds it received from consumers, and
no portion of those payments were used to make monthly payments on student loans. Id. at ¶ 26.
B. The Limited Liability Company
Defendant Alum is a California Limited Liability Company (“LLC”), whose Articles of
Organization were registered with the California Secretary of State on January 24, 2019. Doc.
105-2 at 2. The relevant information stated therein listed: (1) the street and mailing address as
555 Anton Blvd., 1-3 Fl., Costa Mesa, CA 92626; (2) the registered agent as Legalinc Corporate
Services, Inc. (C3444750); and (3) the management structure as “All LLC Member(s)”. Id.
On January 5, 2021, Joe Burwell filed a Statement of Information for the LLC with the
California Secretary of State.4 To the extent worth noting, the signature line is blank.
Nevertheless, this Statement of Information relevantly listed: (1) the street and mailing addresses
as 555 Anton Blvd., 1-3 Fl., Costa Mesa, CA 92626; (2) the two managers/members as Joe
Burwell (whose address was listed as 555 Anton Blvd., 1-3 Fl., Costa Mesa, CA 92626) and
Andrew Burwell (whose address was listed as 1000 S. Coast Dr., Apt. K201, Costa Mesa, CA
92626); (3) the registered agent as Legalinc Registered Agents, Inc. (C4249296); (4) the type of
business as assisting the preparation of loan documents; and (5) no name or address for the Chief
Executive Officer (“CEO”).
4 Plaintiff did not attach this Statement of Information in any of her filings. Nevertheless, as a public record, the Court
may take judicial notice of it. See St. Louis Baptist Temple, Inc. v. Fed. Deposit Ins., 605 F.2d 1169, 1172 (10th Cir.
1979) (“[A] court may: . . . take judicial notice, whether requested or not of its own records and files, and facts which
are part of its public records.” (internal citations omitted)).
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On August 13, 2021, Andrew Burwell executed a declaration under the penalty of perjury.
Doc. 2 at 3. The declaration was then filed on August 20, 2021. See generally Doc. 2. Andrew
Burwell’s declaration was based upon his personal knowledge, id. at 1 ¶ 1, as one of the two
managing members for the LLC, see id. at 1-2 ¶ 2. Of relevance herein, Andrew Burwell
declared that: (1) he (who was domiciled in Laguna Beach, CA) and his father, Jody Burwell
(who was domiciled in Placentia, CA), were the only two members of the LLC, id. at 2 ¶ 3-4; (2)
neither he nor Jody Burwell were licensed attorneys in any state, id.; (3) Defendant Alum “was
unaware of the State Court Action prior to Alum Financial being served the complaint on July
20, 2021,” when Andrew Burwell received the complaint by certified mail, see id. at ¶ 5; and (4)
as one of the LLC’s two managing members, he was “familiar with and ha[d] personal
knowledge of [the LLC]’s operations, past, current and projected revenue, operating expenses,
and profits,” and that the LLC’s “losses would exceed $75,000 were it prohibited from operating
in the State of New Mexico,” id. at ¶ 6.
On January 18, 2022, Plaintiff deposed Andrew Burwell via Zoom. See generally Doc.
100 at 6-14 (Ex. A (Deposition Transcript)) (hereafter, “Depo. Tr.”). Andrew Burwell was duly
sworn under oath, id. at 8 (Depo. Tr. at 4:1-4:3), and was put on notice that his testimony “ha[d]
the same impact as if [he] were in front of a judge and jury,” id. (Depo. Tr. at 4:14-4:16); see also
id. (Depo. Tr. at 4:16-4:23 (informing Andrew Burwell of other safeguards and procedures to
ensure the accuracy of his testimony)). During this deposition, Andrew Burwell testified that he
was the CEO of the LLC, id. at 9 (Depo. Tr. at 5:12), and that the only other officer was “Jody
Burwell, [his] father,” id. (Depo. Tr. at 5:14). Andrew Burwell further testified that there were
no other officers nor members of the LLC. Id. (Depo. Tr. at 5:15-5:18).
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Andrew Burwell testified that “[c]urrently,”—meaning as of January 18, 2022, the date of
the deposition—the LLC had “six [employees],” not including himself or Jody Burwell. Id.
(Depo. Tr. at 5:19-5:25). Yet, Andrew Burwell also testified that the LLC wound down its
operations at an unspecified date in “the beginning of August” 2021. Id. at 12 (Depo. Tr. at
47:5). Andrew Burwell testified that he “can’t tell you exactly what day [this decision]
happened,” id. (Depo. Tr. at 47:7-47:8), but that “[i]t could very well have been” on August 14,
2021, see id. (Depo. Tr. at 47:14-47:20), the day after Andrew Burwell signed the declaration
(Doc. 2) representing to the Court that the LLC would lose $75,000 over the next ten years if
unable to conduct business in the State of New Mexico, see id. at 10-12 (Depo. Tr. at 45:8-46:9,
46:25-47:13).
The decision to wind down was jointly and exclusively made by Andrew Burwell and
Jody Burwell, id. at 12 (Depo. Tr. at 47:21-47:25), because they “decided that it was just best for
us to wind down the business,” id. (Depo. Tr. at 47:9-47:10). Andrew Burwell also explained
that this decision was “just for the sake of getting out of the industry,” id. at 10 (Depo. Tr. at
45:24-45:25), and “in order to alleviate and avoid further problems,” id. at 11 (Depo. Tr. at 46:7-
46:8).
On August 8, 2024, Joe Burwell filed and electronically signed a Statement of
Information for the LLC with the California Secretary of State. See generally Doc. 105-1. Joe
Burwell’s signature was accompanied by a certification that he affirmed “under penalty of
perjury that the information herein is true and correct and that [he was] authorized by California
law to sign.” Id. at 3. Of relevance, this Statement of Information listed: (1) the principal,
mailing, and street addresses as 555 Anton Blvd., 1-3 Fl., Costa Mesa, CA 92626; (2) the two
managers/members as Joe Burwell (whose address was listed as 555 Anton Blvd., 1-3 Fl., Costa
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Mesa, CA 92626) and Andrew Burwell (whose address was listed as 1000 S. Coast Dr., Apt.
K201, Costa Mesa, CA 92626); (3) the registered agent as California Registered Corporate Agent
(1505) (whose address was listed as “REPUBLIC REGISTERED AGENT INC.[,] Registered
Corporate 1505 Agent”); (4) the type of business as assisting the preparation of loan documents;
and (5) no name or address for the CEO. Id. at 2. Additionally, when prompted to opt in or out
of email notifications, the Statement of Information stated “No, I do NOT want to receive entity
notifications via email. I prefer notifications by USPS mail.” Id.
Pursuant to the public records available with the California Secretary of State, the LLC
was suspended by the Franchise Tax Board on May 1, 2025. See St. Louis Baptist Temple, Inc. v.
Fed. Deposit Ins., 605 F.2d 1169, 1172 (10th Cir. 1979) (“[A] court may: . . . take judicial notice,
whether requested or not of its own records and files, and facts which are part of its public
records.” (internal citations omitted)).
II. RELEVANT PROCEDURAL BACKGROUND
On June 16, 2021, Plaintiff filed suit against Defendant Alum in the First Judicial District
for the County of Santa Fe, New Mexico. See Doc. 1-1 at 3. Defendant Alum removed the case
to this Court on August 20, 2021. Doc. 1. On March 24, 2022, with leave of the Court, see
Docs. 34-35, Plaintiff filed a Second Amended Class Action Complaint for Damages,
Declaratory Relief and Injunctive Relief, Doc. 36, which remained the operative complaint in
this matter. Therein, Plaintiff added Defendant Debt Pay Pro, Inc. (“Defendant Debt Pay Pro”)
as a second defendant and alleged that both defendants violated the New Mexico Unfair
Practices Act, N.M. Stat. Ann. §§ 57-12-1 to 57-12-26, and the Telephone Consumer Protection
Act, 47 U.S.C. § 227; 47 C.F.R. § 64.1200. See Doc. 36 at 8-11 ¶¶ 50-71.
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On September 12, 2024, Judge Vázquez granted Defendant Debt Pay Pro’s Motion to
Dismiss (Doc. 41), thereby leaving Defendant Alum the sole remaining defendant. Doc. 59. In
light of this development, the undersigned held a status conference on October 29, 2024, to
discuss the status of the case and reestablish case management deadlines. See Doc. 69 at 1. At
this status conference, counsel mutually reported that the parties agreed to settle all claims and
were in the process of finalizing the paperwork. Id. Therefore, in lieu of scheduling a settlement
conference, the Court ordered the parties to file closing documents within thirty days. Id.
On November 25, 2024, Plaintiff filed notice that Defendant Alum had not yet performed
its payment obligation under the settlement agreement and therefore anticipated filing a motion
to enforce. Doc. 70. The Court therefore extended the deadline for closing documents to
January 2, 2025. Doc. 71. Due to Defendant Alum’s continued failure to execute the settlement
agreement, Plaintiff filed a Motion to Enforce Settlement Agreement on December 20, 2024, Doc.
72, which Judge Vázquez referred to the undersigned on December 23, 2024, Doc. 73.
Defendant Alum did not file a response. Having found that Plaintiff and Defendant Alum formed
a binding and legally enforceable contract, the undersigned entered a Proposed Findings and
Recommended Disposition (“PFRD”) on February 7, 2025, recommending that Plaintiff’s
Motion to Enforce Settlement Agreement (Doc. 72) be granted. Doc. 74.
On February 12, 2025, Defendant Alum’s (now former) counsel filed a Motion to
Withdraw as Counsel of Record. Doc. 75. Therein, Defendant Alum’s former counsel explained
that after agreeing to settle and receiving the draft settlement agreement from Plaintiff’s counsel
on October 18, 2024, former counsel sent Defendant Alum 6 e-mails, 8 text messages, and at
least 18 phone calls between October 20, 2024, and January 15, 2025. Id. at 4-6. Of these
communications, Defendant Alum only responded to one text message on October 23, 2024.
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Consequently, Defendant Alum’s continued failure to respond to former counsel prevented
former counsel from filing a response to Plaintiff’s Motion to Enforce the Settlement Agreement
(Doc. 72). Id. at 6. In fact, former counsel stated they “do not even know if Alum continues to
operate or exists as a viable entity.” Id. In the Motion to Withdraw as Counsel of Record, former
counsel put Defendant Alum on notice that it had fourteen days to respond to the motion, id. at 2,
and twice put Defendant Alum on notice that it, as an LLC, could not proceed pro se, id. at 2, 7.
Filed concomitantly with the Motion to Withdraw as Counsel of Record (Doc. 75),
Defendant Alum’s former counsel filed Proof of Service on Defendant Alum and its two
members (listed as Joe Burwell and Andrew Burwell). Doc. 76. Specifically, on February 12,
2025, see id. at 2, former counsel mailed notice to the following three recipients and addresses:
(1) Joe Burwell at 555 Anton Blvd., 1-3 Fl., Costa Mesa, CA 92626; (2) Andrew Burwell at 1000
S. Coast Drive, Apt. K201, Costa Mesa, CA 92626; and (3) Defendant Alum, courtesy of its
registered agent, Republic Registered Agent Inc., at 3400 Cottage Way, Suite G2, Sacramento,
CA 95825. Id. at 4. Additionally, former counsel emailed notice on February 12, 2025, see id. at
2, to Andrew Burwell at “andrew@leclix.com,” id. at 4.
Neither Defendant Alum nor Plaintiff filed in opposition to the Motion to Withdraw as
Counsel of Record (Doc. 75).
On March 12, 2025, Judge Vázquez issued an Order Adopting Magistrate Judge’s
Proposed Findings and Recommended Disposition. Doc. 78. Later that same day, the
undersigned granted the Motion to Withdraw as Counsel of Record (Doc. 75). Doc. 79.
On March 20, 2025, Plaintiff filed a Motion for Entry of Judgment. Doc. 80. On April
28, 2025, Judge Vázquez granted Plaintiff’s Motion for Entry of Judgment, Doc. 81, and
separately entered a Final Judgment, Doc. 82, which “enforce[d] the Settlement Agreement
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between the parties,” ordered “[Defendant] Alum [to] fully perform under the Settlement
Agreement within fifteen (15) days of the entry of this Judgment,” and warned that “upon failing
to perform, an Order to [Show] Cause shall be entered requiring one of the members of the LLC
to appear in person before the Court or be held in contempt of Court,” id. at 1.
On April 30, 2025, Plaintiff served Defendant Alum and the LLC’s members notice of the
Final Judgment via USPS-First Class Mail and USPS-Priority Mail to the following four
recipients and addresses: (1) Alum Financial LLC, c/o Republic Registered Agent Inc., at 3400
Cottage Way, Suite G2, Sacramento, CA 95825; (2) Andrew Burwell at 1000 S. Coast Dr., Apt.
K201, Costa Mesa, CA 92626; (3) Jody A. Burwell at 1713 Heritage Ave., Placentia, CA 92870;
and (4) Alum Financial LLC, Andrew Burwell/Jody A. Burwell, at 151 Kalmus Dr., Suite C-250,
Costa Mesa, CA 92626. Doc. 83 at 1-2 ¶ 4. The notice was confirmed delivered by USPS
Priority Mail on May 3, 2025. Id.
On June 26, 2025, Plaintiff filed a Motion for Order to Show Cause. Doc. 83. Therein,
Plaintiff moved for: (1) “an Order to Show Cause requiring a duly authorized member of Alum
Financial, LLC to appear in person before the Court on a date certain to explain its failure to
comply with the Court’s Final Judgment;” and (2) “an award of reasonable attorney fees for the
filing of the motion to enforce, obtaining entry of judgment, submission of this motion, and for
further efforts to obtain satisfaction of this judgement.” Id. at 2.
On August 21, 2025, Judge Vázquez referred Plaintiff’s Motion for Order to Show Cause
(Doc. 83) to the undersigned “to conduct hearings, if warranted, including evidentiary hearings,
and to perform any legal analysis required to recommend to the Court an ultimate disposition of
the case.” Doc. 84. Accordingly, on September 5, 2025, the undersigned set an in-person motion
and evidentiary hearing on Plaintiff’s Motion for Order to Show Cause (Doc. 83) for November
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6, 2025, at 9:30 a.m., Doc. 85, in Pecos Courtroom, Doc. 89. The purpose of the hearing was to
take evidence on Plaintiff’s Motion for Order to Show Cause (Doc. 83) and allow Defendant
Alum the opportunity to show cause why it should not be held in civil contempt for failing to
comply with Judge Vázquez’s Final Judgment (Doc. 82). Doc. 85 at 1; see also Doc. 98 at 2.
In the Order Setting In-Person Motion Hearing, the Court directed the Clerk of the Court
to send copies of the order (Doc. 85) and Plaintiff’s Motion for Order to Show Cause (Doc. 83)
via first-class mail to the same four recipients and addresses Plaintiff previously sent notice of
the Final Judgment. See Doc. 85 at 1-2. The Court also directed the United States Marshals
Service to personally serve a copy of the order (Doc. 85) and Plaintiff’s Motion for Order to
Show Cause (Doc. 83) to the following two recipients and addresses: (1) Andrew Burwell at
1000 S. Coast Dr., Apt. K201, Costa Mesa, CA 92626; and (2) Alum Financial LLC, Andrew
Burwell/Jody A. Burwell, at 151 Kalmus Dr., Suite C-250, Costa Mesa, CA 92626. Doc. 85 at 2.
The Court again ordered the same manner of delivery when it issued the Order Resetting In-
Person Motion Hearing by Courtroom Location Only on October 6, 2025. Doc. 89.
The Court first received a signed return on September 22, 2025, for the first-class mail
delivery to Alum Financial LLC, courtesy of Republic Registered Agent Inc., at 3400 Cottage
Way, Suite G2, Sacramento, CA 95825. Doc. 87. The Court also received a signed return receipt
on October 3, 2025, for the first-class mail delivery to Jody A. Burwell at 1713 Heritage Ave.,
Placentia, CA 92870. Doc. 90. Notably, this return receipt bears the name and signature of
“Sandra Ortiz,” whose relationship to Jody Burwell is presently unknown to the Court. Id. at 2.
As for the other two addresses, the mail was returned as undeliverable. See Docs. 88, 92, 95,
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96.5 Moreover, the summonses by the United States Marshals Service were returned unexecuted.
Docs. 93, 94.
At 4:18 p.m. on November 5, 2025—the evening before the hearing—Jody Burwell
emailed the Court an Emergency Pro Se Motion to Continue Hearing, Permit Remote
Appearance, and Dismiss or Stay for Lack of Enforceable Relief (“Emergency Pro Se Motion”).
Doc. 97 (original title in all capital letters). Putting aside Jody Burwell’s non-attorney status and
resulting inability to file motions on behalf of a corporate entity, see Harrison v. Wahatoyas,
L.L.C., 253 F.3d 552, 556 (10th Cir. 2001) (“As a general matter, a corporation or other business
entity can only appear in court through an attorney and not through a non-attorney corporate
officer appearing pro se.” (citation omitted)), the Court converted the hearing to occur via Zoom.
See Doc. 98 at 1. Despite successful delivery of notice of the hearing, see Docs. 87, 90, and Jody
Burwell having reached out to Plaintiff’s counsel as early as October 5, 2025, see Doc. 99 at 8
(billing entry for 0.10 hours for “[r]eview communication under R408 from J Burwell”),
Defendant Alum failed to appear through counsel at the evidentiary hearing on Plaintiff’s Motion
for Order to Show Cause (Doc. 83) and thus failed to obey the Court’s order to retain counsel,
see Doc. 85 at 1. Instead, Jody Burwell appeared in his individual capacity. See Doc. 98 at 1-2.
The Court nevertheless went forward with the hearing and set forth the relevant legal standards,
took judicial notice of the record, and allowed Plaintiff’s counsel to go forward with examining
Jody Burwell under oath as to his personal knowledge, in his individual capacity, concerning the
statements he made in the Emergency Pro Se Motion (Doc. 97). See id. Given the receptivity of
Plaintiff’s counsel and Jody Burwell to independently cure the need for coercive civil contempt
5 In total, the Court made eight first-class mailings. Of those, two produced signed return receipts (Docs. 87, 90), four
were returned as undeliverable (Docs. 88, 92, 95, 96), and two produced no response of either kind. The two
unresponsive mailings were directed to the same two addresses that had previously produced signed return receipts.
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sanctions, the Court ordered Plaintiff’s counsel to email (cc’ing Jody Burwell) Judge
Robbenhaar’s chambers a status report within 15 days. See id. at 4.
As ordered, Plaintiff’s counsel timely emailed Judge Robbenhaar’s chambers a status
report on November 21, 2025. This status report informed the Court that payment of the full
settlement amount, $12,500, had been received. Further, Plaintiff’s counsel had presented
Defendant Alum an invoice for payment of the attorney fees resulting from Defendant Alum’s
untimely payment of the settlement and requested an additional 15 days to resolve this issue or
file a motion moving to impose attorney fees as a sanction.
On December 8, 2025,6 Plaintiff’s counsel emailed Judge Robbenhaar’s chambers the
second status report, explaining that Plaintiff’s counsel had made an offer of compromise for
attorney fees on November 18, 2025, but no response had been received. Thus, Plaintiff filed the
present Motion for Attorney Fees as a Sanction that same day, Doc. 99, which Judge Vázquez
referred to the undersigned on January 13, 2026, Doc. 103.
After Defendant Alum initially failed to respond to the Motion for Attorney Fees as a
Sanction (Doc. 99), the Court sua sponte reset the Response and Reply deadlines, Doc. 102, after
counsel entered an appearance on January 9, 2026, Doc. 101. Accordingly, Defendant Alum
responded on January 26, 2026, Doc. 104, and Plaintiff replied on February 5, 2026, Doc. 105.
Plaintiff filed Notice of Completion of Briefing on March 24, 2026. Doc. 106.
On March 24, 2026, Plaintiff also filed a Request for Hearing on the Motion for Attorney
Fees as a Sanction (Doc. 99). Doc. 107. However, that same day, the Court denied Plaintiff’s
request because “Plaintiff did not list any reason or development supporting her request,” and the
6 The Court notes that the second status report was one day late. Nevertheless, the undersigned accepted this limited
untimeliness, because the efforts of Plaintiff’s counsel were directed at avoiding further judicial intervention and
resolving the issue of contempt more expeditiously.
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Court, having reviewed the relevant briefing, found “that a hearing is not necessary for Judge
Robbenhaar’s determination of the matter.” Doc. 108 at 1.
III. LEGAL STANDARDS
A. Ancillary Jurisdiction
Ancillary jurisdiction flows from the idea that “a district court acquires jurisdiction of a
case or controversy in its entirety, and, as an incident to the full disposition of the matter, may
hear collateral proceedings when necessary to allow it to vindicate its role as a tribunal.” 13
CHARLES ALAN WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE & PROCEDURE § 3523.2 (3rd
ed. 2025). “Thus, if a federal court had jurisdiction of the principal action, it may hear an
ancillary proceeding, regardless of the citizenship of the parties, the amount in controversy, or
any other factor that normally would determine subject matter jurisdiction.” Id.
B. Court’s Inherent Authority to Sanction
Inherent in the judicial power defined by Article III, there exist “‘[c]ertain implied
powers [that] must necessarily result to our Courts of justice from the nature of their institution,’
powers ‘which cannot be dispensed with in a Court, because they are necessary to the exercise of
all others.’” Chambers v. NASCO, Inc., 501 U.S. 32, 43 (1991) (first quoting United States v.
Hudson, 7 Cranch 32, 34 (1812); and then citing Roadway Express, Inc. v. Piper, 447 U.S. 752,
764 (1980)).
In Chambers, the Supreme Court identified three recognized instances where a court may
shift attorney fees pursuant to its inherent authority. Id. at 45-46. First is the “common fund
exception,” which “derives not from a court’s power to control litigants, but from its historic
equity jurisdiction,” id. at 45 (citing Sprague v. Ticonic Nat’l Bank, 307 U.S. 161, 164 (1939)),
and permits a fee award to a party “whose litigation efforts directly benefit others,” id. (citing
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Alyeska Pipeline Serv. Co. v. Wilderness Soc’y, 421 U.S. 240, 257-58 (1975)). “Second, a court
may assess attorney’s fees as a sanction for the ‘willful disobedience of a court order.’” Id.
(quoting Alyeska, 421 U.S. at 258). Third, a court may assess attorney’s fees when a party has
“acted in bad faith, vexatiously, wantonly, or for oppressive reasons,” id. at 45-46 (quoting
Alyeska, 421 U.S. at 258-59 (quotation marks omitted)), which “transcends a court’s equitable
power concerning relations between the parties and reaches a court’s inherent power to police
itself, thus serving the dual purpose of ‘vindicat[ing] judicial authority without resort to the more
drastic sanctions available for contempt of court and mak[ing] the prevailing party whole for
expenses caused by his opponent’s obstinacy,’” id. at 46 (quoting Hutto v. Finney, 437 U.S. 678,
689 n.14 (1978)) (alterations in original).
Courts’ inherent authority “includes ‘the ability to fashion an appropriate sanction for
conduct which abuses the judicial process.’” Goodyear Tire & Rubber Co. v. Haeger, 581 U.S.
101, 107 (2017) (quoting Chambers, 501 U.S. at 44-45). Relevant here, such sanctions may
include an award of attorney fees. Id. (citing Chambers, 501 U.S. at 45). However, the exercise
of such inherent powers “must be exercised with restraint and discretion.” Chambers, 501 U.S.
at 44 (citing Roadway Express, 447 U.S. at 764). Relatedly, in Goodyear, the Supreme Court
clarified that when a court awards attorney’s fees under its inherent authority, it must be
“compensatory rather than punitive,” 581 U.S. at 109 (citing Int’l Union, United Mine Workers
of Am. v. Bagwell, 512 U.S. 821, 826-30 (1994)), and thus be limited to the reasonable fees
actually incurred but for the sanctionable conduct, id. at 108-10. But as the Supreme Court
“stressed in Fox, trial courts undertaking that task ‘need not, and indeed should not, become
green-eyeshade accountants’ (or whatever the contemporary equivalent is).” Id. at 110 (quoting
Fox v. Vice, 563 U.S. 826, 838 (2011)).
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The Tenth Circuit recognizes three types of bad faith conduct: (1) bad faith occurring
during the course of the litigation; (2) bad faith in bringing or maintaining a meritless claim or
colorless defense; and (3) bad faith in the acts giving rise to the substantive claim. Towerridge,
Inc. v. T.A.O., Inc., 111 F.3d 758, 768 (10th Cir. 1997) (citations omitted). Of these categories,
only the first two involve conduct which may justify a fee shifting award. Id. In sufficiently
showing the occurrence of bad faith conduct warranting sanctions, the Tenth Circuit has
explained:
We lack precedent establishing the standard of proof required by a fee-shifting
sanction leveled under a court’s inherent power. But in the past we have required
clear-and-convincing evidence that a litigant acted in bad faith to support a
dismissal sanction. Xyngular v. Schenkel, 890 F.3d 868, 873-74 (10th Cir. 2018);
see also FTC v. Kuykendall, 371 F.3d 745, 754 (10th Cir. 2004) (applying the clear-
and-convincing-evidence standard for proof of contempt of court in connection
with civil contempt sanctions). And other circuits require district courts to find
evidence of bad-faith abuse of the judicial process by clear-and-convincing
evidence. See, e.g., Yukos Cap. S.A.R.L. v. Feldman, 977 F.3d 216, 235 (2nd Cir.
2020). We see no reason why that standard should not apply here.
Becker v. Ute Indian Tribe of Uintah & Ouray Reservation, No. 22-4022, 2023 WL 5051167, at
*6 (10th Cir. Aug. 8, 2023) (internal citations cleaned up). The clear-and-convincing-evidence
standard requires that “evidence places in the ultimate factfinder an abiding conviction that the
truth of its factual contentions are highly probable.” Id. (quoting United States v. Valenzuela-
Puentes, 479 F.3d 1220, 1228 (10th Cir. 2007)) (quotation marks omitted).
1. Liability of Non-Party Corporate Entity Officers
The Court’s ability to sanction is not limited to parties and their counsel. See In re White,
No. 07cv342, 2013 WL 5295652, at *30 (E.D. Va. Sept. 13, 2013) (collecting cases). Relevant
here, “[a] court may sanction a non-party corporate officer who acts improperly on behalf of a
corporate defendant and who attempts to avoid sanctions by hiding behind the corporate veil.”
Anchondo v. Anderson, Crenshaw & Assocs., LLC, No. CV 08-202, 2011 WL 4549279, at *4
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(D.N.M. Sept. 29, 2011) (first citing In re Courtesy Inns, Ltd., 40 F.3d 1084, 1089-90 (10th Cir.
1994); and then citing Helmac Prods. Corp. v. Roth (Plastics) Corp., 150 F.R.D. 563, 568 (E.D.
Mich. 1993)), aff’d sub nom. Anchondo v. Dunn, 511 F. App’x 736 (10th Cir. 2013)).
To extend the courts’ inherent authority over “a non-party not subject to court order,” the
Court must find that the non-party “(1) ha[d] a substantial interest in the outcome of the litigation
and (2) substantially participate[d] in the proceedings in which he interfered.” Helmac, 150
F.R.D. at 568. This test “effectively limit[s] the scope of the Court’s inherent power to sanction
to those individuals who were either (1) parties, (2) subject to a court order, or (3) real parties in
interest.” Id.
C. Reasonable Attorney’s Fees
The proper vehicle for calculating a reasonable award of attorney’s fees is the lodestar
method: the Court multiplies a reasonable hourly rate by the number of hours reasonably
expended. Robinson v. City of Edmond, 160 F.3d 1275, 1281 (10th Cir. 1998); Case v. Unified
Sch. Dist. No. 233, 157 F.3d 1243, 1249 (10th Cir. 1998). The movant bears the burden of
proving both the reasonableness of the rates and the hours expended, Case, 157 F.3d at 1249, and
the billing attorneys must exercise billing judgment by excluding hours that are “excessive,
redundant, or otherwise unnecessary,” Robinson, 160 F.3d at 1281.
In determining whether the hourly rate is reasonable:
the burden is on the fee applicant to produce satisfactory evidence—in addition to
the attorney’s own affidavits—that the requested rates are in line with those
prevailing in the community for similar services by lawyers of reasonably
comparable skill, experience and reputation. A rate determined in this way is
normally deemed to be reasonable, and is referred to—for convenience—as the
prevailing market rate.
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Blum v. Stenson, 465 U.S. 886, 895 n.11 (1984). “Only if the district court does not have before
it adequate evidence of prevailing market rates may the court, in its discretion, use other relevant
factors, including its own knowledge, to establish the rate.” Case, 157 F.3d at 1257.
“Counsel for the party claiming the fees has the burden of proving hours to the district
court by submitting meticulous, contemporaneous time records that reveal, for each lawyer for
whom fees are sought, all hours for which compensation is requested and how those hours were
allotted to specific tasks.” Id. at 1250 (citing Ramos v. Lamm, 713 F.2d 546, 554 (10th Cir. 1983),
overruled on other grounds by Pennsylvania v. Del. Valley Citizens’ Council for Clean Air, 483
U.S. 711 (1987)). In determining whether the hours expended on a case were reasonable, courts
consider several factors:
(1) whether the fees are for tasks that would ordinarily be billed to a client; (2)
whether the party’s counsel used “billing judgment” to winnow the hours from
those actually spent to those that were reasonably expended; and (3) whether the
amount of time spent on a task was reasonable in light of the complexity of the case
or necessitated by the strategies employed by the party’s opponent.
Preitauer v. Am. Fam. Mut. Ins., 741 F. Supp. 3d 934, 941-42 (D. Colo. 2024) (citing Etherton v.
Owners Ins., 82 F. Supp. 3d 1190, 1198 (D. Colo. 2015)). With respect to the third factor—
determining a reasonable amount of time in which to perform a given task—the billing attorney
should consider: “(1) the complexity of the case; (2) the number of reasonable strategies pursued;
(3) the responses necessitated by the maneuvering of the other side; and (4) the potential
duplication of services caused by the presence of multiple attorneys when one would suffice.”
Etherton, 82 F. Supp. 3d at 1198 (citing Ramos, 713 F.2d at 554).
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IV. ANALYSIS
A. The Court Retains Continuing Ancillary Jurisdiction
Before turning to the substantive merits at issue, the Court briefly sets forth its proper
jurisdiction over this matter. Although this is not an issue raised by the parties, “federal courts
have an independent obligation to ensure that they do not exceed the scope of their jurisdiction,
and therefore they must raise and decide jurisdictional questions that the parties either overlook
or elect not to press.” Henderson ex rel. Henderson v. Shinseki, 562 U.S. 428, 434 (2011).
The Court previously found that it had ancillary jurisdiction because trial courts have the
power to summarily enforce settlement agreements entered into by the litigants while the
litigation remains pending. See Doc. 74 at 7 (citing United States v. Hardage, 982 F.2d 1491,
1496 (10th Cir. 1993)). Pursuant to that authority, the Court granted Plaintiff’s Motion to Enforce
Settlement Agreement (Doc. 72). Doc. 78. Relevant to the present analysis, which largely hinges
on the continued avoidance of the settlement agreement the Court enforced, “[i]t is well-
established that a court retains ancillary jurisdiction over subsequent proceedings to enforce its
own orders and judgments.” Phone Directories Co. v. Clark, 209 F. App’x 808, 812 (10th Cir.
2006) (citing Peacock v. Thomas, 516 U.S. 349, 356 (1996)).
B. The Court’s Inherent Authority to Sanction
Plaintiff seeks, as a sanction for Defendant Alum’s noncompliance with the Final
Judgment (Doc. 82), a compensatory award for resulting attorney’s fees, totaling $11,943.90,
jointly and severally against both members of the LLC (Andrew Burwell and Jody Burwell). See
generally Docs. 99, 100. Plaintiff further requests “findings that both individuals exercised
complete control over the entity, misused the LLC form to evade compliance with the Final
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Judgment, failed to appear as ordered, and obstructed enforcement,” as well as “any additional
relief the Court deems necessary to enforce compliance with its orders.” Doc. 100 at 4.
Defendant Alum’s Response (Doc. 104) can be summarized as raising the following
arguments: (1) its conduct did not rise to the level of bad faith or abuse of the judicial process at
issue in Chambers v. NASCO, Inc., 501 U.S. 32 (1991), or Farmer v. Banco Popular of N. Am.,
791 F.3d 1246 (10th Cir. 2015), Doc. 104 at 4-7; (2) Plaintiff failed to meet the burden for
demonstrating alter-ego liability against Jody Burwell and Andrew Burwell under federal
common law, id. at 6-7; (3) Plaintiff’s requested fees are unreasonable, disproportionate to the
settlement amount, include work beyond the scope of enforcement, and lack billing judgment, id.
at 2, 7; (4) Plaintiff failed to establish that Defendant Alum’s conduct proximately caused the
fees incurred, id.; and (5) the Court should order post-judgment discovery under FED. R. CIV. P.
69(a)(2) to allow investigation into the reasonableness of the fees and to reconstruct the
purportedly block-billed entries, Doc. 104 at 8-9.
Plaintiff’s Reply (Doc. 105) can be summarized as raising the following
counterarguments: (1) Defendant Alum’s pattern of refusing to cooperate with its former counsel,
the Court, and Plaintiff’s counsel demonstrates contempt for these proceedings and constitutes
sanctionable conduct, Doc. 105 at 1, 3; (2) although additional efforts to accomplish service were
unsuccessful, Defendant Alum was properly served throughout this matter, on either Defendant
Alum itself at its business address, id. at 2, the LLC’s registered agent, id. (citing FED. R. CIV. P.
4(h)), and/or the LLC’s two managing members (Jody Burwell and Andrew Burwell) at their last
known personal addresses, id. (citing FED. R. CIV. P. 5(b)(2)); (3) Defendant Alum bore the
responsibility of keeping the Court informed of any changes in its address, id. (citing D.N.M.LR-
Civ. 83.6); (4) the attorney fees sought are reasonable, were actually incurred to compel
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Defendant Alum’s compliance with the Final Judgment (Doc. 82), and were contemporaneously
recorded in counsel’s billing software, id. at 3; and (5) FED. R. CIV. P. 69(a)(2) authorizes
discovery only by judgment creditors, not judgment debtors, and thus does not support
Defendant Alum’s request for post-judgment discovery, Doc. 105 at 3.
Both parties invoke Chambers v. NASCO, Inc., 501 U.S. 32 (1991), for the proposition
that the Court’s inherent authority supplies a basis to award attorney’s fees as a sanction. See
Doc. 99 at 2; Doc. 100 at 1; Doc. 104 at 4-5; Doc. 105 at 1, 3. As the Supreme Court explained
in Chambers, in addition to another form not relevant here, a court may issue compensatory
sanctions under either its civil contempt authority or its broader inherent sanction authority. See
501 U.S. at 45-46. Relatedly, the parties’ briefing invokes principles from punitive civil
contempt, inherent-authority sanctions, and veil-piercing without distinguishing among them.7
However, the parties’ briefing appears to largely hinge on the Court’s broader inherent authority.
See generally Docs. 99, 100, 104, 105. Nevertheless, in light of the mixed arguments and the
inherent overlap between the means for sanctions, the Court now briefly discusses which
framework is most appropriate here and thus directs the remainder of the analysis herein.
Having considered the briefing and the full record, the Court proceeds under its inherent
authority to sanction bad faith conduct that abuses the judicial process. Cf. Martinez v. Roscoe,
100 F.3d 121, 123-24 (10th Cir. 1996). In addition to this framework being invoked by both
parties, it allows the Court to consider the full scope of Defendant Alum’s and its members’ bad
faith conduct, which the Court finds relevant given the events leading up to and resulting in the
7 See, e.g., Doc. 100 at 1-2 (discussing inherent authority sanctions); Doc. 100 at 1-4 (specifically discussing violations
of the Court’s orders, which could relate to contempt sanctions or broader authority sanctions); Doc. 100 at 3-4
(discussing federal common-law alter-ego principles, which is a piercing the veil principle, and citing multiple cases
regarding piercing the veil); Doc. 104 at 2 (raising the substantial compliance defense, a defense to civil contempt);
Doc. 104 at 4 (citing caselaw for the framework governing punitive sanctions); Doc. 104 at 6 (discussing federal
common-law alter-ego principles, which is a piercing the veil principle).
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Final Judgment, with which Defendant Alum then failed to comply. See Chambers, 501 U.S. at
57 (“As long as a party receives an appropriate hearing . . . the party may be sanctioned for
abuses of process occurring beyond the courtroom, such as disobeying the court’s orders.”).
C. Sanctions are Warranted for the Bad Faith Conduct of Defendant Alum, Jody
Burwell, and Andrew Burwell
Having established that the Court will proceed pursuant to its broader inherent authority
to sanction bad-faith conduct, the Court now turns to whether sanctions are warranted and, if so,
against whom. Plaintiff seeks to hold Andrew Burwell and Jody Burwell—the LLC’s only
members—jointly and severally liable for the compensatory sanctions. As set forth below, the
record establishes that Defendant Alum, Jody Burwell, and Andrew Burwell engaged in a pattern
of bad-faith conduct that abused the judicial process and caused Plaintiff to incur the attorney’s
fees she now seeks to recover.
1. Defendant Alum’s Willful Disobedience and Bad Faith Conduct
The Court finds, by clear and convincing evidence, that Defendant Alum willfully
disobeyed the Final Judgment (Doc. 82) and that its broader pattern of conduct demonstrates bad
faith in dealing with the Court. See Becker, 2023 WL 5051167, at *6.
First, after the parties agreed to settle all claims, and counsel mutually reported to the
Court that the case was resolved, Doc. 69 at 1, Defendant Alum became entirely nonresponsive
to its own attorneys, who sent 6 e-mails, 8 text messages, and at least 18 phone calls between
October 20, 2024, and January 15, 2025—to which Defendant Alum responded only once via a
text message on October 23, 2024. Doc. 75 at 4-6. This avoidance precluded former counsel
from responding to the Motion to Enforce Settlement Agreement (Doc. 72), delayed signing the
settlement agreement it authorized, and forced the withdrawal of Defendant Alum’s former
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counsel, who stated they “do not even know if Alum continues to operate or exists as a viable
entity.” Id. at 6.
Second, the withdrawal of counsel left Defendant Alum, as an LLC, unable to appear in
federal court, because “a corporation or other business entity can only appear in court through an
attorney and not through a non-attorney corporate officer appearing pro se.” Harrison, 253 F.3d
at 556 (citation omitted). Defendant Alum was expressly put on notice of this requirement. In
the Motion to Withdraw as Counsel (Doc. 75), former counsel twice warned Defendant Alum
that “pursuant to applicable law, including District of New Mexico Local Rule 83.7, a
corporation, unincorporated association or other business entity cannot appear pro se in Federal
Court and must be represented by an attorney authorized to practice before United States District
Court for the District of New Mexico,” and that “Alum must secure representation by an attorney
licensed to practice in the United States District Court for the District of New Mexico if it wishes
to continue to defend this action.” Doc. 75 at 2, 7. Additionally, immediately preceding the
second instance that this warning was stated, there was the following heading in bold,
underlined, all-capital letters: “III. Pursuant to Local Rule 83.7, Alum is Hereby Advised That it
Cannot Appear Pro Se in this Action.” Id. at 7.
On February 12, 2025, former counsel served the Motion to Withdraw as Counsel (Doc.
75) on Defendant Alum and both of its members. Doc. 76; accord FED. R. CIV. P. 4(h), 5(b).
Nevertheless, Defendant Alum took no action to retain new counsel and failed to respond to the
Motion to Withdraw as Counsel (Doc. 75), which constituted consent pursuant to D.N.M.LR-Civ.
83.8(b). Doc. 79 at 2. New counsel did not enter an appearance for Defendant Alum until
January 9, 2026, Doc. 101—almost ten months after the Court granted the withdrawal of former
counsel on March 12, 2025, Doc. 79.
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Third, the Final Judgment was undoubtedly a valid, specific, and definite court order that
Defendant Alum violated. See generally Doc. 82. The Final Judgment specifically “enforce[d]
the Settlement Agreement between the parties,” and clearly ordered Defendant Alum to “fully
perform under the Settlement Agreement within fifteen (15) days of the entry of this Judgment.”
Id. at 1. Because the Final Judgment was entered April 28, 2025, the definite deadline was May
13, 2025. See id. Yet, Defendant Alum disobeyed the order. The fifteen-day compliance
deadline expired on May 13, 2025, and Defendant Alum did not make the settlement payment on
or before that date, provide any explanation, nor move for additional time. See Doc. 83 at 2 ¶ 5.
Instead, Defendant Alum tendered the full payment approximately six months later, only after
Plaintiff filed a Motion for Order to Show Cause (Doc. 83), the Court held an evidentiary hearing
(Doc. 98), and the Court afforded the parties fifteen days to resolve the matter independently.
See Doc. 98 at 4; Doc. 99 at 2.
Defendant Alum had notice of the Final Judgment. Plaintiff served copies of the Final
Judgment on April 30, 2025, to the last known addresses of Defendant Alum, its registered agent,
and both of its members. Doc. 83 at 1-2 ¶ 4. Delivery was confirmed on May 3, 2025. Id.
Federal Rule of Civil Procedure 5(b)(2)(C) provides that service by mail is “complete upon
mailing.” To the extent Defendant Alum contends it did not actually receive the Final Judgment,
such non-receipt is attributable to its own conduct in avoiding participation in this lawsuit and
abandoning its counsel. See Pena v. Bd. of Cnty. Comm’rs for Cnty. of Santa Fe, No. 21-1095,
2023 WL 1765382, at *2 (D.N.M. Feb. 3, 2023) (“[I]f [the contemnor] did not personally receive
copies of the latter three orders, it was due to her unilateral decision to block or ignore the
Court’s and her counsel’s communications.”).
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Fourth, Defendant Alum ignored the Court’s Order Setting In-Person Motion Hearing by
failing to appear through counsel as required. Doc. 85 at 1. This order was mailed and served
via the United States Marshals Service to multiple addresses. See id. at 1-2. While true that mail
was returned undeliverable for two addresses, Docs. 88, 92, 95, 96, and the summonses by the
United States Marshals Service were returned unexecuted, Docs. 93, 94, there was ultimately
sufficient service. The Court received signed return receipts from the registered agent, Doc. 87,
and from Jody Burwell at 1713 Heritage Ave., Placentia, CA 92870, Doc. 90. Although the latter
return receipt was signed by an individual named “Sandra Ortiz,” whose relationship to this case
and/or Jody Burwell is presently unknown to the Court, Jody Burwell subsequently confirmed
this as being his address in the Emergency Pro Se Motion. See Doc. 97 at 2.
This pattern—that is, abandoning counsel, ignoring the lawsuit, ignoring the Final
Judgment, ignoring service, failing to timely retain counsel, and complying only under the most
direct judicial compulsion—constitutes bad faith warranting sanctions pursuant to the Court’s
inherent authority. See Chambers, 501 U.S. at 45-46.
Defendant Alum contends that its conduct “was not in bad faith and did not rise to the
level of abuse of judicial process.” Doc. 104 at 4 (Subheading B). It argues that the conduct at
issue in Chambers and Farmer was far more egregious. See id. at 4-5 (contrasting the patent
destruction of evidence and sham filings in Chambers and the discovery abuses in Farmer). The
Court disagrees. The question is not whether Defendant Alum’s conduct was as extreme as the
conduct in those cases, but whether it constituted bad faith. See Chambers, 501 U.S. at 46
(explaining multiple reasons why courts’ inherent power is “both broader and narrower than
other means of imposing sanctions,” including the fact that “whereas each of the other
mechanisms reaches only certain individuals or conduct, the inherent power extends to a full
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range of litigation abuses. At the very least, the inherent power must continue to exist to fill in
the interstices.” (emphasis added)). Here, the six-month refusal to comply with a clear judicial
directive (to comply with the settlement agreement), combined with the pattern of
disengagement and avoidance discussed above, clearly demonstrates bad faith.
i. Even if the Defense of Substantial Compliance Applies, it Fails
Defendant Alum raises the defense of “substantial compliance,” arguing that its eventual
tender of the settlement payment demonstrates compliance with the “core obligation under the
settlement agreement.” Doc. 104 at 2. This defense fails for multiple reasons.
As an initial matter, substantial compliance is typically a defense to civil contempt, where
the question is whether the contemnor has “show[n] by clear and convincing evidence that ‘all
reasonable steps’ were taken in good faith to ensure compliance with the court order and that
there was substantial compliance, or relatedly by proving ‘plainly and unmistakably’ defendants
were unable to comply with the court order.” Bad Ass Coffee Co. of Haw. v. Bad Ass Coffee
Ltd., 95 F. Supp. 2d 1252, 1256 n.8 (D. Utah 2000). Here, the Court is not proceeding under
civil contempt; it proceeds under its inherent authority to sanction bad-faith conduct. Moreover,
although the substantial compliance defense has been recognized and applied by multiple district
courts in the civil contempt context, the Tenth Circuit has not recognized it. See Phone
Directories Co., 209 F. App’x at 815 (assuming without deciding that substantial compliance is a
defense in a contempt proceeding).
Even assuming the defense applies in this context, Defendant Alum cannot satisfy it.
First, the Final Judgment ordered Defendant Alum to “fully perform under the Settlement
Agreement within fifteen (15) days.” Doc. 82 at 1. Akin to the Supreme Court’s holding that “a
filing deadline cannot be complied with, substantially or otherwise, by filing late—even by one
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day,” United States v. Locke, 471 U.S. 84, 101 (1985), it follows, then, that a court-ordered
deadline cannot be complied with, substantially or otherwise, six months late. To hold otherwise
would reduce court-ordered deadlines to suggestions, undermining both the enforceability of
judgments and the reliability of the obligations they compel. See id. (“Any less rigid standard
would risk encouraging a lax attitude toward filing dates[.]” (quotation marks omitted) (quoting
United States v. Boyle, 469 U.S. 241, 249 (1985))).
Second, Defendant Alum provided no evidence showing “that all reasonable steps were
taken in good faith to ensure compliance.” Bad Ass Coffee Co. of Haw., 95 F. Supp. 2d at 1255
(emphasis added); see also United States v. Hayes, 722 F.2d 723, 725 (11th Cir. 1984) (“Even if
the efforts he did make were ‘substantial,’ ‘diligent’ or ‘in good faith,’ as the [district] court so
characterized them in other sections of its order, the fact that [the contemnor] did not make ‘all
reasonable efforts,’ establishes that [the contemnor] did not sufficiently rebut the [movant’s]
prima facie showing of contempt.” (internal citation omitted)). To the contrary, as set forth
above, the record demonstrates that Defendant Alum took no steps toward compliance until
recently compelled by the impending full weight of judicial authority.
ii. Even if Defense of Inability to Pay Applies, it Fails
Defendant Alum invokes the four-factor framework from Farmer, 791 F.3d at 1259-60,
which the Tenth Circuit adapted from White v. Gen. Motors Corp., 908 F.2d 675 (10th Cir. 1990),
to argue that “the sanction should be limited to the minimum amount necessary to adequately
deter the improper conduct” and that “the court must consider the sanctioned party’s ability to
pay.” Doc. 104 at 4 (citing Farmer, 791 F.3d at 1259).
In Farmer, the Tenth Circuit adopted four factors for measuring punitive inherent-
authority sanctions: (1) whether the amount of fees and costs awarded is reasonable; (2) whether
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the award is the minimum amount reasonably necessary to deter the undesirable behavior; (3) the
(in)ability to pay; and (4) depending on the circumstances, whether any other factors favor a
lesser or greater sanction. 791 F.3d at 1259 (citing White, 908 F.2d at 684-85). The Farmer
court expressly characterized the fee award as “a punitive sanction in the nature of a fine,” id.,
and the factors it adopted from White were designed for sanctions with a deterrent purpose, see
White, 908 F.2d at 685 (“Because of their deterrent purpose, Rule 11 [monetary] sanctions are
analogous to punitive damages.”).
However, two years after Farmer, the Supreme Court decided Goodyear, which held that
fee-shifting under the Court’s inherent authority must be “compensatory rather than punitive,”
and therefore must satisfy a “but-for causation” requirement. 581 U.S. at 108-09; see also KCI
USA, Inc. v. Healthcare Essentials, Inc., 339 F. Supp. 3d 672, 687 n.13 (N.D. Ohio 2018)
(“Goodyear casts doubt on the conclusion that inherent-authority sanctions are always punitive
in nature.”), vacated and remanded, 797 F. App’x 1002 (6th Cir. 2020). Therefore, while district
courts should consider the ability to pay when assessing punitive sanctions, that is not the case
when compensatory sanctions are ordered. See Stenson v. Edmonds, 86 F.4th 870, 877-78 (10th
Cir. 2023) (applying Goodyear but-for standard to uphold a blanket fee award where the entire
case was initiated in bad faith, while making no mention of ability to pay). Because the Supreme
Court has explained that sanctions for bad-faith litigation behavior under a court’s inherent
authority are compensatory, the Court need not consider ability to pay. Other courts have
reached the same conclusion. See, e.g., LaJeunesse v. BNSF Ry., No. 18-214, 2019 WL 7037604,
at *5 (D.N.M. Dec. 20, 2019); Kriegman v. Mirrow, No. 15-cv-01542, 2021 WL 5235647, at *6
(D. Colo. Feb. 8, 2021), objections overruled sub nom. Kriegman as Tr. for LLS Am., LLC v.
Mirrow, 2021 WL 5957417 (D. Colo. Dec. 16, 2021). Instead, the operative question is whether
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the fees sought were actually and reasonably incurred as a result of Defendant Alum’s
sanctionable conduct. See Goodyear, 581 U.S. at 108-10.
Even assuming, arguendo, that the Farmer factors apply, each factor weighs in favor of
awarding compensatory attorney fees. See 791 F.3d at 1259. First, the amount of fees awarded
is reasonable. As discussed below, infra Section IV.D.1-2, the award recommended is limited to
the actual and reasonable fees Plaintiff incurred as a result of the conduct at issue. See Farmer,
791 F.3d at 1259 (finding lodestar calculation was “an acceptable approach to determine the
reasonableness of a fee request under the circumstances presented.”). Second, the sanction is the
minimum amount adequate to deter such misconduct, and although Farmer categorized such
sanctions as punitive, it imposes no penalty beyond making Plaintiff whole. See id. (limiting fee
sanction for bad-faith delay in executing a settlement agreement to fees incurred after a “trigger
date,” which was the date the completed agreement was sent to the offending party).
Third, to the extent Defendant Alum argues that it wound down and is thus unable to pay,
several Circuits have adopted the rule that a contemnor cannot assert an impossibility or “present
inability to comply” defense if the contemnor was responsible for the impossibility or inability to
pay. See, e.g., In re Power Recovery Sys., Inc., 950 F.2d 798, 803 (1st Cir. 1991); Elec. Workers
Pension Tr. Fund of Loc. Union 58, IBEW v. Gary’s Elec. Serv., 340 F.3d 373, 383 (6th Cir. 2003);
Chi. Truck Drivers v. Bhd. Lab. Leasing, 207 F.3d 500, 506 (8th Cir. 2000); Pesaplastic, C.A. v.
Cincinnati Milacron Co., 799 F.2d 1510, 1522 (11th Cir. 1986). Though the Tenth Circuit has not
expressly adopted this rule, the rationale is persuasive, and, in any event, Defendant Alum’s
impossibility argument fails on its own terms. The August 2021 wind-down predated Defendant
Alum’s agreement to settle this matter in October 2024. In other words, Defendant Alum
authorized settling all claims—an agreement this Court found valid and enforceable, Docs. 74,
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78—with full knowledge of its own wind-down status. Having demonstrated the capacity to
negotiate and agree to a settlement after the wind-down, Defendant Alum cannot now invoke that
same wind-down as grounds for impossibility of compliance with the Final Judgment (Doc. 82)
that merely enforced the settlement it voluntarily authorized. Moreover, Defendant Alum has
offered no evidence of inability to pay. See generally Doc. 104. To the contrary, its ability to
tender the full $12,500.00 settlement payment when finally compelled to do so undermines any
suggestion of inability, whether it was by Defendant Alum, Jody Burwell, or Andrew Burwell.
See Farmer, 791 F.3d at 1260. Fourth, no other factors favor a lesser sanction. See id.
2. Personal Liability of Jody Burwell and Andrew Burwell
Plaintiff seeks to hold Andrew Burwell and Jody Burwell—the sole members of the
LLC—jointly and severally liable for the compensatory sanction. Doc. 100 at 1. Although
Andrew Burwell and Jody Burwell are not named parties in this case, they may still be subject to
the Court’s inherent power to sanction. See Anchondo, 2011 WL 4549279, at *4 (“A court may
sanction a non-party corporate officer who acts improperly on behalf of a corporate defendant
and who attempts to avoid sanctions by hiding behind the corporate veil.” (first citing Courtesy
Inns, 40 F.3d at 1089-90; and then citing Helmac, 150 F.R.D. at 568)). To do so, the Court need
not pierce the corporate veil. See id. To that end, the Court need not reach the parties’ arguments
regarding alter ego liability under federal common law, which goes to piercing the corporate veil.
Instead, the Court may use its inherent powers to sanction non-parties who “(1) have a
substantial interest in the outcome of the litigation and (2) substantially participate[d] in the
proceedings in which he interfered.” Helmac, 150 F.R.D. at 568. As set forth below, Jody
Burwell and Andrew Burwell satisfy each prong.
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i. Substantial Interest in the Outcome
Courts have recognized that sole or controlling owners of a corporate entity have a
substantial interest in litigation involving that entity, because the owners bear the economic
consequences of any adverse outcome. See, e.g., Helmac, 150 F.R.D. at 567; Anchondo, 2011
WL 4549279, at *6.
Here, as the sole members and managers of the LLC, Doc. 100 at 9 (Depo. Tr. at 5:5-
5:18); Doc. 105-1 at 2 (Statement of Information), Jody Burwell and Andrew Burwell are the
only individuals with a stake in the LLC’s obligations, see United States v. Voss, 82 F.3d 1521,
1526 (10th Cir. 1996) (“The required personal connection with the organization’s defiance of the
court may arise from the agent’s general control over the organization’s operations or from his or
her participating or aiding and abetting in conduct circumventing the subpoena or order.”). Any
liability imposed on Defendant Alum—an entity that has been suspended by the California
Franchise Tax Board as of May 1, 2025—ultimately falls on its members. Additionally, Jody
Burwell and Andrew Burwell share the exclusive authority in decision-making for the LLC.
Therefore, Jody Burwell and Andrew Burwell have a substantial interest in the outcome
of this litigation, and thus the first prong of the Helmac test is satisfied.
ii. Substantial Participation in the Proceedings
Both Jody Burwell and Andrew Burwell substantially participated in the proceedings
giving rise to the sanctions presently sought. The Helmac test requires participation that goes
beyond a mere tangential connection to the litigation. 150 F.R.D. at 568. Here, Jody Burwell
and Andrew Burwell participated in two distinct ways: through direct engagement with the
litigation and through directing the LLC’s course of noncompliance.
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As to direct engagement, the record shows that both Jody Burwell and Andrew Burwell
affirmatively participated in these proceedings. Andrew Burwell executed a declaration under
penalty of perjury at the outset of the case, representing to the Court that the LLC would suffer
losses exceeding $75,000 if unable to conduct business in New Mexico. Doc. 2 at 2 ¶ 6. He
subsequently testified under oath at his deposition on January 18, 2022, about his role as the
LLC’s CEO and sole decision-maker alongside his father, and about the LLC’s operations and
wind-down. Doc. 100 at 9 (Depo. Tr. at 5:5-5:16); id. at 12 (Depo. Tr. at 47:21-47:25). Jody
Burwell filed the Emergency Pro Se Motion (Doc. 97) on the eve of the evidentiary hearing,
appeared at the hearing, and testified under oath about his individual knowledge in his personal
capacity. Doc. 98 at 1-2.
As to directing the LLC’s noncompliance, Jody Burwell and Andrew Burwell were the
sole individuals with authority to cause Defendant Alum to comply with the settlement
agreement and the Final Judgment (Doc. 82), and neither took any action to do so for six months.
The record shows that Jody Burwell and Andrew Burwell jointly controlled the LLC’s
operations, including the decision to wind down in August 2021, Doc. 100 at 12 (Depo. Tr. at
47:21-47:25), and that Jody Burwell continued managing the entity’s state filings as recently as
August 2024, Doc. 105-1 at 2.
The Court therefore finds that Jody Burwell and Andrew Burwell satisfy both prongs of
the Helmac test: (1) they have a substantial interest in the outcome of this litigation; and (2) they
substantially participated in the proceedings. Helmac, 150 F.R.D. at 568. Accordingly, the Court
may properly exercise its inherent authority to impose sanctions against them personally, jointly
and severally with Defendant Alum.
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3. Due Process: Notice and Opportunity to be Heard
When sanctions are sought pursuant to a court’s inherent authority, due process requires
that the person or entity against whom sanctions are to be imposed has received reasonable
notice and a meaningful opportunity to be heard. See Mullane v. Cent. Hanover Bank & Tr. Co.,
339 U.S. 306, 314 (1950) (“An elementary and fundamental requirement of due process in any
proceeding which is to be accorded finality is notice reasonably calculated, under all the
circumstances, to apprise interested parties of the pendency of the action and afford them an
opportunity to present their objections.” (emphasis added)). Importantly, the right to an
opportunity to be heard does not require that the person actually avail themselves of that
opportunity; due process is satisfied when adequate notice is given, and a meaningful
opportunity is afforded. See id.; see also Jones v. Flowers, 547 U.S. 220, 225 (2006) (“[D]ue
process does not require actual notice . . . .”).
i. Defendant Alum
Defendant Alum received constitutionally adequate notice and a meaningful opportunity
to be heard at each stage of the enforcement proceedings and the underlying events leading up to
the present motion.
As to notice, on April 30, 2025, Plaintiff served notice of the Final Judgment (Doc. 82) to
Defendant Alum’s registered agent, Republic Registered Agent Inc., accord FED. R. CIV. P. 4(h),
and to both of the LLC’s members at their respective last known addresses via USPS-First Class
Mail and USPS-Priority Mail, accord FED. R. CIV. P. 4(h).8 See Doc. 83 at 1-2 ¶ 4. On June 26,
8 As noted, in addition to the service made directly to the LLC’s registered agent, both of the LLC’s members were
served with these filings. The Court further details such service below, infra Sections IV.D.3.ii-iii, but briefly reiterates
that here because it is worth noting that a corporate entity only acts through its officers. See Louisville & C. Ry. v.
Louisville Tr. Co., 174 U.S. 552, 573 (1899) (“A corporation, though legally considered a person, must perform its
corporate duties through natural persons, and is impersonated in and represented by its principal officers, the president
and directors, who are not merely its agents, but are, generally speaking, the representatives of the corporation in its
dealings with others.”).
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2025, Plaintiff similarly served the Motion for Order to Show Cause (Doc. 83) to the same
addresses. See Doc. 83 at 3; accord FED. R. CIV. P. 4(h), 5(b). The Court then mailed copies of
the Order Setting In-Person Motion Hearing (Doc. 85) and the Motion for Order to Show Cause
(Doc. 83) to Defendant Alum’s registered agent and to the LLC and its members at their last
known addresses, Doc. 85 at 1-2, and directed the United States Marshals Service to personally
serve copies on Alum Financial, courtesy of Andrew Burwell/Jody A. Burwell, at 151 Kalmus
Dr., Suite C-250 Costa Mesa, CA 92626, id. at 2. The Court again ordered the same manner of
delivery when it issued the Order Resetting In-Person Motion Hearing by Courtroom Location
Only on October 6, 2025. Doc. 89. The Court received a signed return receipt from Defendant
Alum’s registered agent on September 22, 2025. Doc. 87. On December 8, 2025, Plaintiff
served the Motion for Attorney Fees as a Sanction (Doc. 99) and the Supplemental Brief (Doc.
100) by USPS-certified mail to Defendant Alum’s registered agent and by email to Jody Burwell
at joeburwell@gmail.com. Doc. 99 at 4; Doc. 100 at 5.
As to opportunity to be heard, after new counsel entered an appearance on January 9,
2026, Doc. 101, the Court sua sponte reset the briefing deadlines, Doc. 102. Accordingly,
Defendant Alum responded on January 26, 2026, addressing the merits of the present motion
(Doc. 99). Doc. 104. Defendant Alum thus received both notice and a full opportunity to be
heard, and it exercised that opportunity through its Response. Due process is satisfied.
ii. Jody Burwell
Although Jody Burwell is not a named party, the record demonstrates that he received
constitutionally adequate notice and opportunity to be heard. See Mullane, 339 U.S. at 314.
As to notice, on February 12, 2025, Defendant Alum’s former counsel served the Motion
to Withdraw as Counsel (Doc. 75)—which twice warned that the LLC could not proceed without
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counsel, Doc. 75 at 2, 7—on Joe Burwell at 555 Anton Blvd., 1-3 Fl., Costa Mesa, CA 92626.
Doc. 76 at 4. On April 30, 2025, Plaintiff served Jody Burwell with notice of the Final Judgment
(Doc. 82) at 1713 Heritage Ave., Placentia, CA 92870. Doc. 83 at 1-2 ¶ 4. The Final Judgment
expressly warned that “upon failing to perform, an Order to [Show] Cause shall be entered
requiring one of the members of the LLC to appear in person before the Court or be held in
contempt of Court.” Doc. 82 at 1. The Court then mailed copies of the Order Setting In-Person
Motion Hearing (Doc. 85) and the Motion for Order to Show Cause (Doc. 83) to Jody Burwell at
the same Placentia address. Doc. 85 at 1-2. The Court received a signed return receipt from that
address on October 3, 2025. Doc. 90. Although the return receipt bears the name and signature
of “Sandra Ortiz,” whose relationship to this case and/or Jody Burwell is presently unknown to
the Court, Jody Burwell subsequently confirmed the Placentia address as being his address in the
Emergency Pro Se Motion. See Doc. 97 at 2. On December 8, 2025, Plaintiff served the Motion
for Attorney Fees as a Sanction (Doc. 99) on Jody Burwell by email at joeburwell@gmail.com.
Doc. 99 at 4.
Moreover, the record reflects that Jody Burwell was in direct communication with
Plaintiff’s counsel as early as October 5, 2025, see Doc. 99 at 8 (billing entry for “[r]eviewing
communication under R408 from J Burwell”), demonstrating his actual knowledge of these
proceedings. The billing entries also reflect communications between Jody Burwell and
Plaintiff’s counsel on or about October 7, 2025, see id. (“[F]ollow up email to Burwell.”),
October 28, 2025, see id. (“Review and respond to email from Burwell.”), October 31, 2025, see
id. (“Review email from Burwell . . . .”), November 5, 2025, see id. at 9 (“Review email with
attached alleged emergency motion.”).9
9 Even if the billing entries reflect instances of reviewing a previous email, there were clearly ongoing communications
during this time nevertheless. Moreover, it undermines Defendant Alum’s contention that “shortly before the
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As to opportunity to be heard, Jody Burwell appeared at the November 6, 2025,
evidentiary hearing and testified under oath as to his personal knowledge in his individual
capacity. Doc. 98 at 1-2. Moreover, his interests were represented through Defendant Alum’s
Response, which specifically addressed the question of personal liability of the LLC’s members.
See Doc. 104 at 5-7. Due process is therefore satisfied as to Jody Burwell.
iii. Andrew Burwell
Although Andrew Burwell is not a named party, the record shows that he received
constitutionally adequate notice and opportunity to be heard. See Mullane, 339 U.S. at 314.
As to notice, Andrew Burwell received notice of this enforcement proceeding at the same
address consistently listed for him on the LLC’s Statements of Information filed with the
California Secretary of State. See Doc. 105-1 at 2 (listing Andrew Burwell’s address as 1000 S.
Coast Dr., Apt. K201, Costa Mesa, CA 92626). On February 12, 2025, Defendant Alum’s former
counsel served the Motion to Withdraw as Counsel (Doc. 75)—which twice warned that the LLC
could not proceed without counsel, Doc. 75 at 2, 7—on Andrew Burwell by mail to 1000 S.
Coast Dr., Apt. K201, Costa Mesa, CA 92626, and by email to andrew@leclix.com. Doc. 76 at
4. On April 30, 2025,10 Plaintiff served Andrew Burwell with mailed notice of the Final
Judgment (Doc. 82) at the same address. Doc. 83 at 1-2 ¶ 4. The Court then directed the Clerk
of the Court to mail copies of the Order Setting In-Person Motion Hearing (Doc. 85) and the
Motion for Order to Show Cause (Doc. 83) to Andrew Burwell at 1000 S. Coast Dr., Apt. K201,
Evidentiary Hearing on Plaintiff’s Motion to Show Cause, Defendant Alum Financial received notice of the hearing
and immediately acted and responded to the Court.” Doc. 104 at 3 (citing Doc. 97) (emphasis added).
10 That same day, Andrew Burwell indirectly confirmed that this remained his address because he filed a Statement of
Information, which he electronically signed under the penalty of perjury, for one of his other LLCs, LECLIX LLC,
and in doing so, listed his address as 1000 S. Coast Dr., Apt K201, Costa Mesa, CA 92626. See St. Louis Baptist
Temple, Inc., 605 F.2d at 1172 (“[A] court may: . . . take judicial notice, whether requested or not of its own records
and files, and facts which are part of its public records.” (internal citations omitted)).
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Costa Mesa, CA 92626, and directed the United States Marshals Service to personally serve
Andrew Burwell at that address. Doc. 85 at 1-2.
Although the mail sent to Andrew Burwell was returned as undeliverable, Docs. 92, 95,
and the summons was returned unexecuted, Doc. 94, the Court finds that the notice provided
satisfied due process under the circumstances. Due process “does not require actual notice,”
Jones, 547 U.S. at 225, but instead requires “notice reasonably calculated, under all the
circumstances, to apprise interested parties of the pendency of the action and afford them an
opportunity to present their objections,” Mullane, 339 U.S. at 314. Here, the notice was sent to
the address listed for Andrew Burwell on the LLC’s most recent Statement of Information, filed
on August 8, 2024, Doc. 105-1 at 2, which was the same address last known to former counsel,
see Doc. 76 at 4. If Andrew Burwell did not personally receive copies of these mailings, such
non-receipt is attributable to his own conduct—whether by failing to maintain a valid mailing
address, by allowing mail to go uncollected, or by otherwise disengaging from obligations he
knew existed. See Pena v. Bd. of Cnty. Comm’rs for Cnty. of Santa Fe, No. 21-1095, 2023 WL
1765382, at *2 (D.N.M. Feb. 3, 2023) (“[I]f [the contemnor] did not personally receive copies of
the latter three orders, it was due to her unilateral decision to block or ignore the Court’s and her
counsel’s communications.”).
As to opportunity to be heard, after counsel entered an appearance for Defendant Alum
on January 9, 2026, Doc. 101, the Court sua sponte reset the briefing deadlines, Doc. 102, and
Defendant Alum filed a Response that addressed the question of personal liability upon its
members, see Doc. 104 at 2-3, 5-7. Andrew Burwell’s interests were thus represented. The fact
that Andrew Burwell did not appear individually does not transform otherwise adequate notice
into a due process violation. Due process requires the opportunity to present objections, not that
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the person actually do so. See Mullane, 339 U.S. at 314 (requiring only “notice reasonably
calculated, under all the circumstances” and “an opportunity to present their objections”).
D. But-For Causation and the Compensatory Award
1. But-For Causation
Under Goodyear, the Court must determine whether the fees sought would not have been
incurred but for Defendant Alum’s sanctionable conduct. 581 U.S. at 108-10. Here, the but-for
analysis is straightforward. Had Defendant Alum not authorized entering a settlement agreement
knowing it could not or would not honor, continued avoiding its contractual duties, and then
ignored the Court’s orders enforcing that settlement agreement and requiring Defendant Alum to
appear through counsel, then Plaintiff would not have incurred the present fees sought. Put
differently, if Defendant Alum complied with the legally-binding obligation of the Settlement
Agreement it authorized in the first place, then there would have been no Motion to Enforce
Settlement Agreement (Doc. 72), no Motion for Order to Show Cause (Doc. 83), no hearing
preparation, no evidentiary hearing (Doc. 98), no Motion for Attorney Fees as a Sanction (Doc.
99), and no briefing on sanctions (Docs. 100, 104, 105).
2. Reasonable Attorney’s Fees
Having established but-for causation, the Court must also ensure that the fees awarded
are reasonable and were actually incurred to ensure that the compensatory award does not, in
substance, become a punitive windfall. See Goodyear, 581 U.S. at 108. The Court therefore
turns to the reasonableness of the specific fees sought.
Here, Plaintiff seeks an award of $11,943.90 in attorney’s fees. Doc. 99 at 3. The total
sought derives from $11,040.00 in fees for 28.0 total billable hours—with 26.4 billable hours
completed by Robert David Humphreys at $400.00 an hour and 1.6 billable hours completed by
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Paul Catalano at $300.00 an hour—plus the New Mexico Gross Receipts Tax rate at 8.1875%.
See Doc. 99 at 10.
As discussed below, the Court concludes that an award of $11,467.88 is reasonable. The
Court’s total derives from (and differs from the proposed amounts as italicized) $10,600 in fees
for 26.9 total billable hours—with 25.3 billable hours completed by Robert David Humphreys at
$400.00 an hour and 1.6 billable hours completed by Paul Catalano at $300.00 an hour—plus the
New Mexico Gross Receipts Tax rate at 8.1875%.
i. Reasonable Hourly Rates
“The first step in setting a rate of compensation for the hours reasonably expended is to
determine what lawyers of comparable skill and experience practicing in the area in which the
litigation occurs would charge for their time.” Case, 157 F.3d at 1256 (quotation marks and
citation omitted). Here, the relevant market is the District of New Mexico.
The burden is on Plaintiff, as the fee applicant, “to produce satisfactory evidence—in
addition to the attorney’s own affidavits—that the requested rates are in line with those
prevailing in the community for similar services by lawyers of reasonably comparable skill,
experience and reputation. A rate determined in this way is normally deemed to be reasonable,
and is referred to—for convenience—as the prevailing market rate.” Blum, 465 U.S. at 895 n.11.
In support of the hourly rates sought, Plaintiff submitted two declarations. Doc. 99 at 12-15 (Ex.
B (Declaration of Robert David Humphreys)); Doc. 99 at 16-17 (Ex. C (Declaration of Richard
N. Feferman)). Defendant Alum did not challenge the hourly rates or submit any rebuttal
evidence to establish the prevailing market rate. See generally Doc. 104.
Pursuant to Mr. Humphreys’ own declaration (Doc. 99 at 12-15 (Ex. B)), Mr. Humphreys:
has practiced consumer protection law for slightly more than 30 years, see Doc. 99 at 12; is
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admitted to practice in New Mexico (2016) and Oklahoma (1987), id.; has been admitted
(generally or pro hac vice) in multiple federal and state courts, id.; participated in dozens of
consumer protection trials and settlements, with multiple notable outcomes, id. at 12-13;
meaningfully contributes to the field (e.g., writing testimony to four state legislative committees
and presenting to the National Association of State Consumer Finance), id. at 13; serves as a
teacher and mentor for multiple national, state, and local associations, id. at 13-14; and has
received multiple awards, id., including the National Consumer Law Center’s 2017 Vern
Countryman Award, which is “widely regarded as the preeminent award in Consumer Law,” id.
at 13.
Mr. Humphreys’ declaration then discusses the experience of Paul Catalano, who: has
practiced law in Oklahoma for 17 years; is admitted (generally and pro hac vice) to multiple
federal courts and one state court; has been recognized in Oklahoma as a “Rising Star” in
consumer litigation; and has conducted continuing legal education seminars in multiple county
bar associations. Id. at 14 ¶ 4.
In addition to discussing the experience and credentials of him and Mr. Catalano, Mr.
Humphreys further explained that he:
[B]elieve[s] the hourly rates requested are justified here, not only market rates for
the experience of Plaintiffs’ counsel, but also to incentivize private attorneys in
New Mexico to provide representation to consumers who have been harmed by
businesses engaged in deceptive practices. Further an award of hourly attorney fees
against the LLC members will potentially disincentivize the predatory use of a
Limited Liability Company to shield members from the consequences of their
unlawful conduct.
Id. at 14-15 ¶ 9.
In addition to his own declaration, Mr. Humphreys’ submitted the Declaration of Richard
N. Feferman, Doc. 99 at 16-17 (Ex. C), a shareholder at Feferman, Warren & Mattison who has
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practiced consumer protection law in New Mexico since 1978, id. at 16 ¶ 2, and himself charges
$425.00 per hour, id. at 17 ¶ 8. Although the Feferman Declaration was executed on September
7, 2023, id. at 17, in connection with a separate proceeding, see id. at 16 (listing different case
caption), it establishes Mr. Feferman’s own rate and his familiarity with prevailing rates in this
market, both of which the Court finds probative here. Specifically, the fact that a comparably
credentialed practitioner charges more than the rate sought here corroborates, rather than
undermines, the reasonableness of Mr. Humphreys’ $400.00 rate. See Blum, 465 U.S. at 895
n.11 (satisfactory evidence includes evidence that requested rates “are in line with those
prevailing in the community for similar services by lawyers of reasonably comparable skill,
experience and reputation.”).
The Court therefore finds that Plaintiff’s evidence of reasonable market rates to be
sufficient to support charging $400.00 per hour for Mr. Humphreys’ services and $300.00 per
hour for Mr. Catalano’s services. Moreover, Defendant Alum failed to raise any arguments as to
the hourly rates sought and likewise failed to submit any contrary evidence of the prevailing
market rate. See generally Doc. 104. In such an instance, the Court may properly rely on the
unrebutted evidence. See Blum, 465 U.S. at 900 (“[R]espondents failed to show that the hourly
rates failed to provide a reasonable fee for the quality of representation provided . . . . Absent
specific evidence to the contrary, we cannot say that [the] rates [sought] per hour for these three
attorneys do not fully reflect the quality of their representation.”). Because the Court finds
Plaintiff’s unrebutted evidence of reasonable market rates to be sufficient, the Court should not
use its own knowledge to establish what it thinks is a prevailing rate. See Case, 157 F.3d at 1257
(“Only if the district court does not have before it adequate evidence of prevailing market rates
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may the court, in its discretion, use other relevant factors, including its own knowledge, to
establish the rate.” (emphasis added)).
ii. Reasonable Hours Expended
Plaintiff seeks compensation for 28.0 hours of attorney time expended between
November 2024 and December 2025 in connection with enforcing the Final Judgment (Doc. 82).
Doc. 99 at 3, 5-11. All time entries were contemporaneously recorded in counsel’s billing
software, and Plaintiff’s counsel attested that billing judgment was exercised to exclude
unrelated or duplicative time. Id. at 14 ¶ 6.
Having independently reviewed the time records, the Court is mostly satisfied that the
hours expended are reasonable considering the procedural history of this enforcement effort,
which required repeated motion practice, an order to show cause, and a hearing. The Court first
takes issue with the charge of 0.60 hours ($240.00) by Mr. Humphreys for “Rework authority
and eliminate arguments re corp veil to avoid an unnecessary argument,” Doc. 99 at 10, because
the present motion raises the issue of piercing the LLC’s veil, see Doc. 100 at 2-4. The Court
therefore deducts 0.6 hours. Second, as later discussed, the Court also reduces a 0.5 entry for
duplication. In total, the Court finds 25.3 hours by Mr. Humphreys and 1.6 hours by Mr.
Catalano to be reasonable.
Defendant Alum raises several arguments regarding the hours expended, each of which
the Court addresses in turn.
First, Defendant Alum argues that the requested fees ($11,943.90) are “disproportionate”
to the settlement amount ($12,500). Doc. 104 at 7. This argument, made without any citation to
authority, conflates the measure of sanctions with the underlying obligation. The proper measure
is the actual fees incurred but for the bad-faith conduct, not the amount of the underlying
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settlement. Under Goodyear, the question is whether the fees were incurred but for Defendant
Alum’s sanctionable conduct, not whether they bear some proportional relationship to the
settlement amount. See 581 U.S. at 108-10.
Second, Defendant Alum contends that “[a]lthough Plaintiff argues the winding up of the
LLC caused her to incur more legal expenses, Plaintiff waited over four years after the business
closed in 2021 to incur those legal fees on an invoice from 2025.” Doc. 104 at 7. This
misconstrues Plaintiff’s arguments. The fees at issue were incurred between November 2024 and
December 2025 in connection with enforcing the settlement agreement and Final Judgment
(Doc. 82). If Plaintiff were arguing as Defendant Alum contends—that the LLC’s wind-down
caused her to incur additional fees—the trigger date would relate back to 2021. But Plaintiff
makes no such argument. The fees were triggered not by the wind-down itself, but by Defendant
Alum’s decision to enter into a settlement agreement that this Court found valid and enforceable,
see Docs. 74, 78, and its subsequent failure to honor that agreement—claiming only afterward
that the LLC had been wound down and lacked assets to pay, despite its members’ knowledge of
those very facts at the time they agreed to settle. See Doc. 100 at 3-4.
Third, Defendant Alum argues, without citing any authorities, that entries relating to
research on personal liability of LLC members “goes beyond simple enforcement” and
“represents an attempt to expand the scope of the litigation rather than directly responding to
non-compliance.” Doc. 104 at 7. The Court disagrees. Research into personal liability was a
necessary and foreseeable consequence of Defendant Alum’s own conduct—having wound down
the LLC and left it without assets, Jody Burwell and Andrew Burwell made it necessary for
Plaintiff’s counsel to investigate how to collect the agreed-upon settlement amount. The
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approximately 2.5 hours spent on this issue (see Doc. 99 at 7, 9) was both reasonable in amount
and causally connected to Defendant Alum’s conduct.
Fourth, Defendant Alum contends that “many of the time entries relate to internal
communications, routine case management, or duplicative efforts that should be excluded under
proper billing judgment.” Doc. 104 at 7. Defendant Alum does not identify any specific entry
on those grounds; the argument is entirely generalized. See id. Having reviewed the time
records, the Court finds that the entries reflect legitimate work that would ordinarily be billed to
a client. The 27.4 total hours expended over the relevant thirteen-month period are not excessive
given the procedural history.
Fifth, to the extent Defendant Alum characterizes the time entries as “block-billed,” Doc.
104 at 8-9, the Court finds that this characterization, even where accurate, does not warrant a
reduction. “Block billing” is the practice of lumping multiple tasks into a single entry of time
such that the billing entry does not delineate how hours were allotted to specific tasks. See
Cadena v. Pacesetter Corp., 224 F.3d 1203, 1214-15 (10th Cir. 2000). However, there is no per
se prohibition on block billing; it is not a definite basis to deny an attorney’s fee award request.
Id. at 1215 (citing Robinson, 160 F.3d at 1281). Rather, the question is whether the entries are
sufficiently detailed to allow the Court to determine if the hours claimed are reasonable. See
Case, 157 F.3d at 1250 (“A district court is justified in reducing the reasonable number of hours
if the attorney’s time records are ‘sloppy and imprecise’ and fail to document adequately how he
or she utilized large blocks of time.” (quoting Jane L. v. Bangerter, 61 F.3d 1505, 1510 (10th Cir.
1995)) (emphasis added)).
The Court has carefully reviewed the 41 time entries submitted by Plaintiff. See
generally Doc. 99 at 5-11. Notably, 18 of these 41 entries contain descriptions listing multiple
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discrete tasks, with specific breakdowns allocated to each task within the entry. See, e.g., Doc.
99 at 7 (entry dated 02/13/2025, billing 2.30 hours total, explained and broken down as:
“Research liability of members for judgment and sanctions. 1.1 [hours.] Begin draft of motion
re personal liability of LLC Members. 1.2 [hours.]”). When the sub-tasks within those 18
entries are counted individually, the time records reflect approximately 64 discrete billing entries.
The majority of these 64 entries identify a single task and time allocation. Of these 64 entries, at
most 12 could arguably be characterized as block-billed—that is, they describe more than one
task without allocating specific time to each:
1) 03/14/2025: 1.40 hours for “Research and draft motion for entry of judgment,” Doc.
99 at 7;
2) 06/25/2025: 0.90 hours for “Draft Motion for Order to Show Cause and Proposed
Order,” id.;
3) 09/05/2025: 0.10 hours for “Review and respond to client question re appearance and
timing,” id.;
4) 10/05/2025: 0.50 hours for “Evaluate time records, prepare requested papers,” id. at
8;
5) 10/07/2025: 0.10 hours for “Review DA email and follow up email to Burwell,” id.;
6) 10/28/2025: 0.20 hours for “Review and respond to email from Burwell,” id.;
7) 10/28/2025: 0.50 hours for “Review email from Burwell claiming lack of consent to
settlement and claim of LLC being without assets; evaluate settlement file, court
order, and judgment,” id.;
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8) 10/29/2025: 0.50 hours (presumably, based on subtracting the other time listed in the
other sub-entry from the larger entry’s total) for “Evaluate settlement agreement,
order enforcing settlement agreement, and judgment and evaluate next steps,” id.;
9) 10/31/2025: 0.40 hours for “Review email from Burwell; obtain and provide court
orders requested, draft email re Hendricks view and further settlement negotiations,”
id.;
10) 11/03/2025: 0.20 hours for “Communicate with DA and client re status of payment
and whether hearing will proceed this week,” id.;
11) 11/07/2025: 0.20 hours for “Review ECF filing from Court, email copy to Burwell,”
id. at 9; and
12) 12/01/2025: 0.30 hours for “Review time charges, begin prep of fee application,” id.
The entries are sufficiently detailed to permit meaningful review, and the amounts of time
billed are modest. These 12 entries total approximately 5.30 hours out of Mr. Humphreys’ 26.4
billed hours. Ten of the twelve entries are 0.50 hours or less, and the largest is 1.40 hours. See
Doc. 99 at 6-10. Because the block-billed entries involve small increments of time, related tasks,
and/or sufficient descriptions, “the Court concludes that the use of . . . block billing do[es] not
prevent the Court from evaluating the reasonableness of the time expended by [Plaintiff]’s
attorneys.” Preitauer, 741 F. Supp. 3d at 945. The Court has conducted its review and
concludes that 11 of these 12 entries are reasonably billed.
Entries 1, 2, 8, and 12: The entries numbered as 1, 2, 8, and 12, above are each part of a
single, interrelated task; the response is a natural and immediate consequence of the review. See
Harmer v. Berryhill, No. 14-cv-408, 2019 WL 488285, at *4 (D. Utah Feb. 7, 2019) (finding that
combining time spent drafting and editing was permissible because “such functions are often
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billed together, and the overall time was not unreasonable.”); Dunn & Fenley, LLC v. Diederich,
No. 10-4038, 2012 WL 359753, at *5 (D. Kan. Feb. 2, 2012) (approving entries involving
“logically related tasks, such as researching and outlining a single motion” that did not appear to
be attempts to “camouflage” the work performed). Such entries do not invoke the degree of
vagueness underlying courts’ discouragement of block-billing. See Barker v. GR Inv. Grp. LLC,
No. 23-cv-0332, 2024 WL 5381499, at *2 (D.N.M. July 10, 2024) (reducing a 1.4-hour block-
billed entry because “the Court is unable to determine how much time can be credited for
preparing the Application for Fees and what appears to be multiple emails between counsel.”).
Entries 3, 5, 6, 9: The same is true with reviewing and responding to related emails.
Therefore, the entries numbered as 3, 5, 6, and 9, above, are sufficient. Each describes a
communication received and the attorney’s natural, responsive action. See Hensley v. Eckerhart,
461 U.S. 424, 437 n.12 (1983) (counsel “is not required to record in great detail how each minute
of his time was expended” but need only “identify the general subject matter of his time
expenditures.”).
Entry 10: Similarly, with respect to the entry numbered as 10, above, it describes
communication between Plaintiff’s attorneys and Plaintiff addressing two substantively related
topics: the status of payment and whether the hearing would proceed that week. Whether
payment had been made bore directly on whether the hearing would go forward; these are not
independent subjects improperly combined. See id. Moreover, requiring separate time entries
for each act would produce the same or greater total billing: two entries of 0.10 hours each would
equal the 0.20 hours billed here, and could potentially exceed it if rounding were applied to each
increment independently. See Doe v. McAfee, No. 13-cv-01287, 2015 WL 4324547, at *6 (D.
Colo. July 16, 2015) (observing that separating each email event into a separate billing entry
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“has the effect of magnifying the actual time spent on these tasks due to the lack of granularity in
a decimal billing system.”).
Entry 11: Regarding the entry numbered as 11, above, the Court finds that reviewing an
ECF filing from the Court and emailing a copy to the opposing party (in lieu of opposing counsel
where there is none) is a single, natural workflow. Forwarding a court filing to a relevant party is
the immediate, ministerial completion of reviewing it; no independent professional judgment
separates the two acts. See Hensley, 461 U.S. at 437 n.12; see also McAfee, 2015 WL 4324547,
at *6.
Entry 4: With respect to the entry numbered as 4, above, evaluating time records and
preparing requested papers are arguably two distinct tasks, but both are sequential steps in the fee
application process. Put differently, evaluating the time records is a necessary predicate to
preparing the fee papers. At 0.50 hours, the total time is modest, and the entry is sufficiently
detailed to permit meaningful review.
Entry 7: The Court will reduce 0.50 hours for the October 28, 2025 entry listed as
number 7 above. This entry—reviewing Jody Burwell’s email and then evaluating the settlement
file, court order, and judgment—appears to overlap with entries numbered above as 6 and 8, in
which counsel again evaluated the settlement agreement, the order enforcing it, and the
judgment. Because both entries describe reviewing the same set of documents on consecutive
days, the Court cannot determine whether the document evaluation in entry 7 represents
independent work or duplicates the effort billed in entries 6 and 8. The Court therefore reduces
this entry as potentially duplicative. See Case, 157 F.3d at 1250.
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In conclusion, the Court finds 25.3 hours by Mr. Humphreys and 1.6 hours by Mr.
Catalano to be reasonable. This number reflects the 0.5- and 0.6-hour reductions from Mr.
Humphreys’ billing entries.
iii. Lodestar Calculation
Having found the reasonable hourly rates and reasonable hours expended for each
attorney, the Court now applies the lodestar formula. Multiplying Mr. Humphreys’ reasonable
rate of $400.00 per hour by his 25.3 reasonable hours (reflecting the Court’s 1.1-hour total
deduction) yields $10,120.00. Multiplying Mr. Catalano’s reasonable rate of $300.00 per hour
by his 1.6 reasonable hours yields $480.00. The sum produces a lodestar of $10,600.00. There
is generally a “strong presumption” that the lodestar represents a reasonable fee. Perdue v.
Kenny A. ex rel. Winn, 559 U.S. 542, 546 (2010). Nothing in the record rebuts that presumption.
To the lodestar the Court adds New Mexico Gross Receipts Tax at the current applicable
rate of 8.1875%, which is customarily included in attorney’s fees awards in the District of New
Mexico. O Centro Espirita Beneficente Uniao Do Vegetal in U.S. v. Duke, 343 F. Supp. 3d 1050,
1101-02 (D.N.M. 2018). Applying that rate to the $10,600.00 lodestar produces $867.88 in New
Mexico Gross Receipts Tax, for a total compensatory award of $11,467.88.
3. Post-Judgment Discovery is Unnecessary
Defendant Alum requests post-judgment discovery under Federal Rule of Civil Procedure
69(a)(2) for “further investigation” into the reasonableness of Plaintiff’s fees. Doc. 104 at 8-9.
As Plaintiff correctly states, Rule 69(a)(2) only authorizes discovery by a “judgment creditor” to
aid in execution of a judgment; it does not authorize discovery by a judgment debtor for the
purpose of challenging a fee request. See FED. R. CIV. P. 69(a)(2) (“[T]he judgment creditor . . .
may obtain discovery from any person—including the judgment debtor.”). Defendant Alum cites
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no authority supporting the proposition that a judgment debtor may invoke Rule 69(a)(2) to
conduct discovery into the opposing party’s fee records, and the Court is aware of none.
Moreover, the Court notes the tension between Defendant Alum’s argument that the
requested fees are “disproportionate” to the settlement amount, Doc. 104 at 7, and its
simultaneous request for post-judgment discovery that would, if granted, generate further fees
and costs. Even setting aside that tension, the marginal potential utility of the requested
discovery does not justify the additional burden it would impose. Defendant Alum has not
identified any specific deficiency in the fee records that discovery could cure, nor explained what
information it expects to uncover that is not already apparent from the record beyond the vague
unsubstantiated claim of block-billing. Indeed, the Court’s analysis herein demonstrates that
Defendant Alum’s failure to meaningfully engage with the billing records was without merit.
Under these circumstances, post-judgment discovery would serve only to prolong litigation that
has already demanded undue amounts of the Court’s and the parties’ resources.
For these reasons, Defendant Alum’s request for post-judgment discovery should be
DENIED.
V. RECOMMENDATION
For the foregoing reasons, the undersigned RECOMMENDS that Plaintiff’s Motion for
Attorney Fees as a Sanction (Doc. 99) be GRANTED IN PART. The undersigned specifically
recommends that the Court: (1) hold Defendant Alum, Jody Burwell, and Andrew Burwell
jointly and severally liable for paying Plaintiff $10,600.00 in attorney’s fees and $867.88 in New
Mexico Gross Receipts Tax as a compensatory sanction; and (2) require full payment of the
$11,467.88 within fourteen (14) days of the Court’s order.
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The undersigned FURTHER RECOMMENDS that Defendant Alum’s request for post-
judgment discovery, see Doc. 104 at 8-9, be DENIED.
_____________________________________
JOHN F. ROBBENHAAR
United States Magistrate Judge
THE PARTIES ARE NOTIFIED THAT WITHIN 14 DAYS OF SERVICE of a copy of these
Proposed Findings and Recommended Disposition they may file written objections with the Clerk
of the District Court pursuant to 28 U.S.C. § 636(b)(1). A party must file any objections with the
Clerk of the District Court within the fourteen-day period if that party wants to have
appellate review of the proposed findings and recommended disposition. If no objections are
filed, no appellate review will be allowed.
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