On March 6, 2024, Justice Cohen of the New York County Commercial Division issued a decision in Greenman v. Miller, 2024 NY Slip Op. 30709(U), awarding fees based on a proportional division of the total fees between compensable and non-compensable claims, explaining:
To the extent Mrs. Greenman was not successful on all of her claims, she has set forth a good faith effort to apportion her fees according to those claims eligible for indemnification based on the provisions in the Millman and 392 Columbus operating agreements and, in turn, between those entities. Based on Mrs. Greenman’ s proposed method of apportionment, she allocates 60 percent of her fees incurred to the claims eligible for fee recovery.
Miller argues that Mrs. Greenman’ s proposed approach of allocating her fees on a percentage basis according to her eligible claims is not acceptable. However, when allocating attorneys’ fees between compensable and non-compensable claims, courts regularly make across-the-board percentage cuts in hours, as opposed to an item-by-item approach, to arrive at
(Internal quotations and citations omitted).
the reasonable hours expended. This is especially so where, as here, the length of the litigation makes it impracticable to perfectly separate out the hours dedicated to unsuccessful claims. Miller does not explain why it would be inappropriate for the Court to apply this approach here to allocate Mrs. Greenman’s fees between those claims that are compensable, as well as between those claims that relate exclusively to 392 Columbus versus Millman. Based on the record and the Court’s familiarity with the issues litigated throughout this case, the Court finds Mrs. Greenman’ s proposed apportionment appropriate.
The court explained the apportionment of the fees as follows:
Mrs. Greenman apportioned her fees by contentions finding that there were 13 distinct, substantial contentions in this action, and found that 7 out of the 13 contentions are eligible contentions. They are: (1) Miller’s appropriation of Millman’s loan business, (2) the 392 Columbus distributions, (3) the parties’ consulting fee payments, (4) Miller’s backup indemnity, (5) Miller funding his litigation expenses with Millman funds, (6) Charles’ legal invoices as manager of Millman, and (7) Charles’ legal invoices as manager of 392 Columbus. The ineligible contentions are: (1) Miller distributing $3.4 million to himself in 2015, (2) Miller changing Millman’s capital accounts in his favor, (3) Miller lending Millman money to his sons, (4) Miller’s administrative payments (to Mr. Block and Aiping Chen) with Millman funds, (5) Miller’s loan receivables from 392 Columbus to W2 labs, and (6) Miller withholding SDMJD distributions. Mrs. Greenman also weighted twice the two central contentions (Millman’s loan business and the parties’ consulting fee payments) which represented an outsized share of the work performed.
(Internal quotations and citations omitted).