United States District Court, M.D. Florida, Tampa Division
REPORT AND RECOMMENDATION
G. WILSON, UNITED STATES MAGISTRATE JUDGE
cause came on to be heard upon John W. Hardin's Motion
for an Award of Costs and Fees Pursuant to Fed. R. Civ. Pro.
65(c) (Doc. 100). The motion was referred to me for a report
and recommendation (Doc. 104). After reviewing the memoranda,
the parties' exhibits, and conducting oral argument on
the motion, I recommend that the motion be denied because the
movants fail to establish that Rule 65(c) is a cognizable
basis for recovery of their attorney's fees and expenses.
plaintiffs allege that the defendants engaged in fraudulent
transfers in order to avoid satisfying multi-million dollar
judgments entered in favor of the plaintiffs and against
certain defendants (see Doc. 1). The plaintiffs
filed on February 10, 2016, a Motion for Temporary
Restraining Order and Preliminary Injunction, seeking, among
other relief, to freeze all assets, including a prohibition
against the transfer of any assets (Doc. 2, p. 3).
February 11, 2016, the court granted in part the motion for a
Temporary Restraining Order (TRO) (Doc. 4). As pertinent
here, the TRO enjoined the defendants "from transferring
assets outside of the ordinary course of business, " and
specified that "ordinary course transfers [may] not
exceed $250, 000 per transfer or $1, 000, 000 in the
aggregate" (id., P- 12). The court also
scheduled a hearing on the motion (id., p. 13). The
court ordered that the TRO would become effective upon the
plaintiffs posting of a $100, 000 injunction bond, and stay
in effect for 14 days thereafter (id., p. 12).
February 17, 2016, the plaintiffs posted the bond as required
by the TRO (Doc. 39). On February 22, 2016, Thomas Cushing,
counsel for the JH defendants, notified the court in
correspondence that "the limits set forth in ... [the
TRO] ... do not reflect the size of routine, 'ordinary
course transfers' to contractual counterparties and
others for my clients" (Doc. 100-7). Cushing advised
that, consequently, the JH defendants would be making
payments in excess of the limits stated in the TRO in order
to fulfill their obligations to the IRS and their clients
(id.). Cushing also informed the court that he would
attend the court hearing "to contest the plaintiffs'
motion for temporary restraining order and preliminary
February 24, 2016, the court held a hearing on the TRO (Doc.
51). The court focused upon its authority to restrict the
defendants' use of their assets, and the proper amount of
the bond (see id.). During that hearing,
Cushing stated that the transactional monetary limits in the
TRO did not satisfy his clients' business needs
(id., pp. 46-48). The court continued the TRO in
effect until the hearing scheduled for the following week.
The court added, however, that it had no objection to the
parties stipulating to an increase in the amount of funds
that the defendants could transfer in order to meet their
customary business obligations (id., PP-49-50).
February 25, 2016, defense counsel sent correspondence to
plaintiffs' counsel, requesting them to withdraw the
motion for temporary restraining order or, alternatively, to
"agree to a modification of the [TRO] to allow my
clients to meet their financial obligations to their clients
... governments, and to employees" (Doc. 100-8, p. 1).
Plaintiffs' counsel stated that he was amenable to the
latter request, and the parties agreed to a modification of
the TRO to permit the JH defendants to make certain payments
that exceeded the limits of the TRO (see Doc. 100-9, 100-10).
February 29, 2016, the court held a second hearing on the TRO
(see Doc. 100-12). Also pending before the court were the
defendants' Motion to Dissolve the Temporary Restraining
Order (Doc. 56), and the plaintiffs' brief in further
support of their Motion for a Preliminary Injunction (Doc.
52; see Doc. 100-12, p. 84). At the hearing, the defendants
argued that the plaintiffs' claims are for money damages
and, therefore, this is an action at law for which there is
no judicial authority to freeze or restrict a defendant's
assets before judgment (see Doc. 64, pp. 36, 37).
The plaintiffs contended that they were seeking the equitable
remedy of restitution and, consequently, the court has the
authority to enjoin use of assets in a preliminary injunction
without it amounting to an prejudgment attachment of assets
(see id., pp. 30-32, 74).
close of the hearing, the court issued an Order Granting, in
Part, and Denying in Part, the defendants' Motion to
Dissolve Temporary Restraining Order (Doc. 59). It stated
that, "[h]aving reviewed the motions, heard the
arguments of counsel, and for the reasons stated in open
Court, " the Motion to Dissolve is granted, except with
respect to the defendants' obligation to preserve all
potentially relevant evidence and electronically stored
information (id.). The Court expressly stated that
the TRO is dissolved as to the asset freeze (id.)-
John W. Hardin subsequently filed this Motion for an Award of
Costs and Fees Pursuant to Fed.R.Civ.Pro. 65(c) (Doc. 100).
The JH defendants request an attorney's fees award of $7,
462.50, and expenses of $1, 076.40, incurred as a result of
the "wrongfully entered restraining order of February
11, 2016" (Doc. 100; Doc. 100-1). The
attorney's fees relate primarily to defense counsel's
attendance at the two court hearings and his efforts to
modify the TRO's limits on monetary transactions (see
Doc. 100-1, ¶¶ 2a-2e). The JH defendants also seek
reimbursement for counsel's airline flights to attend the
hearings (id., ¶ 4).
plaintiffs oppose this motion (Doc. 102). They dispute that
the defendants were wrongfully enjoined, and argue that the
defendants' attorney's fees and expenses are not
recoverable under this Rule (id., p. 4). Oral
argument was conducted on the motion (see Doc. 172).
the court denied the plaintiffs' Motion for Preliminary
indicated, the JH defendants seek an award of attorney's
fees and expenses pursuant to Rule 65 (c), ...