Best Payphones, Inc.

UNITED STATES BANKRUPTCY COURT 	NOT FOR PUBLICATION
SOUTHERN DISTRICT OF NEW YORK
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In re: 	:
: 	Chapter 11
BEST PAYPHONES, INC., 	: 	Case No. 01-15472(SMB)
:
Reorganized Debtor. :
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MEMORANDUM OPINION AWARDING
LEGAL FEES AND EXPENSES TO THE
MANHATTAN TELECOMMUNICATIONS CORPORATION
A P P E A R A N C E S:
DUANE MORRIS LLP
Attorneys for Manhattan
Telecommunications Corporation
380 Lexington Avenue
New York, New York 10168
Fran M. Jacobs, Esq.
Of Counsel
LARRY I. GLICK, ESQ.
1305 Franklin Avenue
Suite 180
Garden City, New York 11530
STUART M. BERNSTEIN
Chief United States Bankruptcy Judge:
Manhattan 	Telecommunications 	Corporation 	(“MetTel”) 	is 	a
creditor of the reorganized debtor, Best Payphones, Inc. 	By virtue
of an earlier order of the Court, MetTel is entitled to recover its
legal fees and expenses incurred in connection with certain state
court litigation described below. 	It seeks the aggregate amount of
$53,308.40. 	The 	debtor 	filed 	objections, 	and 	contends 	that 	the
fees and expenses should be reduced by $17,050.00. 	For the reasons
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1 A copy of the Agreement is attached as Exhibit A to the Affidavit [of Fran M.
Jacobs, Esq.] in Support of Fee Application, sworn to September 30, 2004)(ECF Doc. #
338)(“Jacobs Affidavit”).
2
that follow, the objections are overruled.
BACKGROUND
At 	all 	relevant 	times, 	the 	debtor 	owned 	and 	operated 	pay
telephones at various locations in the New York metropolitan area.
By 	Agreement 	dated 	September 	24, 	1999 	(the 	“Agreement”), 	MetTel
agreed 	to 	provide 	local 	and 	regional 	exchange 	service 	to 	the
debtor’s phones.1 	The Agreement was be governed by New York law,
and 	provided 	that 	“[i]n 	the 	event 	that 	any 	action 	is 	brought 	by
either 	party 	to 	enforce 	any 	term 	or 	condition 	of 	this 	Agreement,
the prevailing party shall be entitled to recover its actual legal
cost, 	including 	attorney’s 	fees, 	court 	costs 	and 	costs 	of
collection . . . .” 	(Agreement, at § 6.1.)
In 	February 	2001, 	MetTel 	sued 	the 	debtor 	in 	state 	court 	to
recover 	unpaid 	charges 	under 	the 	Agreement. 	MetTel 	moved 	for
summary judgment on an “account stated” theory, and the state court
granted the motion from the bench. 	On May 9, 2001, the state court
entered 	judgment 	in 	favor 	of 	MetTel, 	and 	awarded 	damages 	in 	the
amount 	of 	$185,205.68, 	plus 	interest 	and 	costs, 	for 	a 	total
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2 On June 29, 2001, the state court entered a second judgment awarding attorneys’
fees to MetTel in the amount of $20,140.00. The fees and expenses sought in the current
application relate to a different stage of the litigation. They were not considered by the Special
Referee, and they are not part of the second judgment.
3
judgment of $189,320.39. 2
A. 	Post-Judgment Litigation
MetTel immediately took steps to enforce the judgment, serving
executions 	and 	restraining 	notices 	in 	several 	New 	York 	counties.
(See 	Declaration 	[of 	Donald 	J. 	Tobias, 	Esq.] 	in 	Response 	to
Debtor’s 	Objections 	to 	Damage 	Award, 	sworn 	to 	Mar. 	25, 	2005
(“Tobias Declaration”), at ¶¶ 3, 4)(ECF Doc. # 390.) 	Three weeks
after the entry of judgment, the debtor deposited $190,300.71 with
the clerk of the state court to stay enforcement of the judgment.
(Jacobs Affidavit, ¶ 8.) 	The debtor also moved in state court to
enjoin enforcement.
MetTel 	opposed 	the 	stay, 	arguing 	that 	the 	bond 	was
insufficient to cover the judgment, interest and the sheriff’s 5%
poundage fee. 	The state court granted the debtor’s motion on the
condition that it increase its deposit by $12,000.00, a condition
with which the debtor complied. 	(Id., at ¶ 9.)
The debtor filed a notice of appeal from the judgment to the
Appellate Division. 	It failed, however, to prosecute the appeal,
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and 	MetTel 	moved 	to 	dismiss 	it. 	The 	Appellate 	Division 	directed
MetTel 	to 	perfect 	the 	appeal 	for 	the 	Court’s 	December 	2001 	term,
but the debtor filed its bankruptcy petition on October 23, 2001,
before the deadline. 	(Id., at ¶ 10.)
MetTel 	then 	moved 	for 	relief 	from 	the 	stay 	in 	this 	Court 	so
that the appeal could proceed. 	The Court granted the motion, and
directed the debtor to perfect its appeal by March 18, 2002. 	(See
id., at ¶ 11 & Ex. D.) 	The debtor failed to comply with the order,
and instead, moved in the Appellate Division on March 18, 2002, for
additional 	time. 	MetTel 	opposed 	the 	motion, 	and 	cross-moved 	to
dismiss the appeal. 	The Appellate Division ultimately granted the
debtor’s motion, but directed the debtor to perfect the appeal for
the September, 2002 term. 	(Id., at ¶ 12.)
When 	the 	debtor 	finally 	served 	its 	brief 	and 	the 	record 	on
appeal, 	the 	record 	omitted 	crucial 	documents 	and 	included 	others
that were illegible. 	In addition, the brief raised new arguments.
(Id., 	at 	¶ 	13.) 	MetTel 	had 	to 	file 	a 	supplemental 	appendix, 	and
research 	and 	respond 	to 	the 	new 	arguments. 	(Id.) 	The 	Appellate
Division 	unanimously 	affirmed 	the 	judgment 	on 	November 	11, 	2002.
(Id., at ¶ 15 & Ex. E.)
The debtor moved for reargument, again raising new arguments.
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The debtor also made a separate motion for leave to appeal. 	(Id.,
at ¶¶ 16-17.) 	MetTel opposed both motions. 	The Appellate Division
initially 	rejected 	the 	motion 	to 	reargue 	based 	on 	procedural
deficiencies, (id., at ¶ 17), and eventually denied both motions on
the merits. 	(Id., at ¶ 18.)
Following the Appellate Division’s decision, the debtor moved
for leave to appeal to the Court of Appeals. 	The Court of Appeals
denied the motion on July 2003, (id.), ending the state court phase
of the litigation between the parties. 	In the process, MetTel had
to 	oppose 	five 	separate 	post-judgment 	motions 	by 	the 	debtor, 	and
make its own motion to compel the debtor to prosecute its appeal.
(Id.)
B. 	Bankruptcy Court Litigation
The 	litigation 	eventually 	shifted 	to 	this 	Court. 	Although
this 	has 	been 	an 	extremely 	litigious 	case 	that 	has 	resulted 	in
several reported and unreported decisions, only one aspect of the
litigation is important for now. 	In July 2002, the debtor objected
to 	MetTel’s 	proof 	of 	claim. 	(Id., 	at 	¶ 	19.) 	MetTel 	moved 	for
partial summary judgment. 	In a decision dated December 11, 2002,
the Court, inter alia, awarded partial summary judgment to MetTel
on 	the 	issue 	of 	the 	debtor’s 	liability 	for 	attorney’s 	fees 	and
legal 	expenses 	incurred 	by 	MetTel 	in 	connection 	with 	the 	state
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3 As noted, this did not include the fees subsumed within the earlier state court
judgment.
4 In its reply papers, MetTel asked for an additional $7,573.50 to cover the fees
incurred in responding to the debtor’s objections to the current application. (Reply Affidavit [of
Fran M. Jacobs, Esq.] in Response to Debtor’s Objections to Damage Award, sworn to Mar. 25,
2005 (“Jacobs Reply Affidavit”), at ¶ 20.) 	This request, raise for the first time on appeal, was
procedurally improper. Furthermore, the Court’s earlier award of partial summary judgment did
not encompass these fees, and no determination has been made that the debtor is liable for them.
Accordingly, the supplemental request will not be considered on the current motion.
6
court 	litigation. 3 	The 	amount 	of 	the 	fees 	and 	expenses 	would 	be
decided 	in 	a 	later 	proceeding. 	See 	In 	re 	Best 	Payphones, 	Inc.,
Case No. 01-15472, 2002 WL 31767796, at *10 (Bankr. S.D.N.Y. Dec.
11, 2002.)
C. 	The Current Application
MetTel now seeks fees and expenses in the sum of $53,308.40.
Duane 	Morris 	LLP, 	MetTel’s 	principal 	counsel, 	billed 	$39,458.00
during the approximate two year period spanning June 2001 through
May 2003, and also incurred $4,701.48 in expenses. 4 	(Id., at ¶ 44
& Ex. U; see id., ¶¶ 21-38 & Exs. F-T.) 	The supporting affidavit
of Fran M. Jacobs, Esq. attested that the firm billed for services
at 	its 	usual 	and 	customary 	rates 	and 	charges, 	the 	bills 	were
prepared from contemporaneous time records, and the services were
reasonable 	and 	necessary 	in 	light 	of 	the 	extensive 	post-judgment
motion practice and the appeals. 	(See id., ¶ 20.) 	Finally, MetTel
actually paid Duane Morris the aggregate sum of $44,159.48 in fees
and 	expenses 	sought 	in 	the 	current 	application. 	(Jacobs 	Reply
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5 The debtor also pointed out that Tobias was retained six days before the service of
the notice of entry of the judgment. (Debtor’s Opposition, at ¶ 6.) It did not explain why this
was significant since Tobias was retained after the state court awarded summary judgment from
the bench. Obviously, MetTel began thinking about the problems with collection immediately.
7
Affidavit, at ¶ 2.)
MetTel also seeks to recover $8,865.00 in fees and $283.92 in
expenses paid to Donald J. Tobias, Esq. 	(Jacobs Affidavit, ¶ 7.)
Tobias 	is 	an 	attorney 	who 	specializes 	in 	collection 	work, 	and
provided all of his services in May and June 2001.
D. 	The Debtor’s Opposition
The debtor asserts that the Court should reduce the award by
$17,050.00, 	and 	makes 	four 	arguments. 	First, 	Tobias 	spent
substantial 	time 	preparing 	a 	motion 	to 	appoint 	a 	receiver 	and
researching the adequacy of the appeal bond. 5 	(Debtor’s Objection
to 	Application 	of 	Manhattan 	Telecommunications 	Corporation 	for
Attorney’s 	Fees 	and 	Expenses, 	dated 	Feb. 	22, 	2005 	(“Debtor’s
Objection”), at ¶ 7.) 	These services did not benefit MetTel, and
those 	that 	did 	(the 	filing 	of 	executions 	and 	the 	issuance 	of
restraining 	notices 	in 	three 	counties), 	were 	worth 	no 	more 	than
$3,000.00. 	(Id., 	at 	¶ 	8.) 	Second, 	Fran 	Jacobs’s 	hourly 	billing
rate 	should 	be 	reduced 	by 	$40.00 	to 	the 	amount 	allowed 	by 	the
Special Referee during the earlier fee litigation. 	(Id., at ¶¶ 9,
16-17.) 	Third, 	Francine 	Nisim, 	Esq., 	an 	associate, 	spent 	an
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6 The Agreement allows the prevailing party – here, MetTel – to recover its “actual
legal cost, including attorney’s fees, court costs and costs of collection.” (Agreement, § 6.1.)
MetTel apparently concedes that its fees and expenses must also be reasonable.
7 DR 2-106(B) states:
A fee is excessive when, after a review of the facts, a lawyer of ordinary prudence would
be left with a definite and firm conviction that the fee is in excess of a reasonable fee.
Factors to be considered as guides in determining the reasonableness of a fee include the
following:
(1) The time and labor required, the novelty and difficulty of the questions involved and
the skill requisite to perform the legal service properly.
(2) The likelihood, if apparent or made known to the client, that the acceptance of the
particular employment will preclude other employment by the lawyer.
(3) The fee customarily charged in the locality for similar legal services.
(4) The amount involved and the results obtained.
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excessive amount of her time duplicating what Jacobs did, (Id., at
¶¶ 	11-13), 	and 	also 	spent 	an 	unreasonable 	amount 	of 	time 	(three
hours) 	preparing 	for 	and 	attending 	a 	motion 	for 	an 	adjournment.
(Id., 	at 	¶ 	14.) 	Fourth, 	the 	Court 	should 	not 	award 	the 	fees
attributable to the managing clerk’s office. 	The Special Referee
disallowed similar fees in their entirety. 	(Id., at ¶ 15.)
DISCUSSION
A. 	Introduction
The 	criteria 	for 	measuring 	reasonable 	attorneys 	fees 6 	under
New York law is summarized in Disciplinary Rule 2-106(B), N.Y. C OMP .
C ODES R. & REGS ., tit. 22, § 1200.11(B)(McKinney 2003). 7 	The eight
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(5) The time limitations imposed by the client or by circumstances.
(6) The nature and length of the professional relationship with the client.
(7) The experience, reputation and ability of the lawyer or lawyers performing the
services.
(8) Whether the fee is fixed or contingent.
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factor test set out in the Disciplinary Rule is consistent with the
twelve factor approach adopted by the court in Johnson v. Georgia
Highway Express, Inc., 488 F.2d 714, 718-19 (5 th Cir. 1974); accord
Pennsylvania 	v. 	Delaware 	Valley 	Citizens’ 	Council 	for 	Clean 	Air,
478 U.S. 546, 562 n. 7 (1986)(the Johnson factors are taken from DR
2-106); 	Hensley 	v. 	Eckerhart, 	461 	U.S. 	424, 	430 	n.3 	(1983)(the
Johnson factors “derive directly from” DR 2-106). 	The same general
principles 	also 	apply 	to 	compensation 	awards 	under 	§ 	330 	of 	the
Bankruptcy 	Code. 	In 	re 	Manoa 	Fin. 	Co., 	853 	F.2d 	687, 	690-91 	(9 th
Cir. 1988); In re Cena’s Fine Furniture, Inc., 109 B.R. 575, 580 &
n.12 (E.D.N.Y. 1990); see In re Apex Oil Co., 960 F.2d 728, 731 (8 th
Cir. 1992).
To 	facilitate 	the 	consideration 	of 	the 	relevant 	factors,
courts 	have 	adopted 	the 	“lodestar” 	approach. 	This 	involves
multiplying the reasonable attorney billing rate by the reasonable
number of hours expended. 	See Savoie v. Merchants Bank, 166 F.3d
456, 	460 	(2d 	Cir. 	1999); 	In 	re 	Cena’s 	Fine 	Furniture, 	Inc., 	109
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8 The actual time slips need not be produced; “an affidavit attaching a
computerized printout of the pertinent contemporaneous time records is acceptable.” Tri-Star
Pictures, Inc. v. Unger, 42 F. Supp. 2d 296, 302 (S.D.N.Y. 1999).
10
B.R. 	at 	581. 	The 	“lodestar” 	includes 	“most, 	if 	not 	all” 	of 	the
factors relevant to determining a reasonable fee. 	Pennsylvania v.
Delaware Valley Citizens’ Council for Clean Air, 478 U.S. at 566;
see 	Blum 	v. 	Stenson, 	465 	U.S. 	886, 	898-900 	(1984)(the 	“lodestar”
incorporates 	most 	of 	the 	Johnson 	factors). 	Adjustments 	to 	the
“lodestar” 	amount 	are 	proper 	only 	in 	rare 	and 	exceptional 	cases
supported by specific evidence and detailed findings. 	Pennsylvania
v. 	Delaware 	Valley 	Citizens’ 	Council 	for 	Clean 	Air, 	478 	U.S. 	at
565; see Blum v. Stenson, 465 U.S. at 898-901.
The fee applicant has the burden of proving the reasonableness
of 	the 	billing 	rates 	and 	the 	number 	of 	hours 	expended, 	and 	must
submit contemporaneous time records that support the hours worked
and rates claimed. 8 	Toys “R” Us, Inc. v. Abir, No. 97 Civ. 8673,
1999 WL 61817, at *1 (S.D.N.Y. Feb. 10, 1999); see New York State
Ass’n for Retarded Children, Inc. v. Carey, 711 F.2d 1136, 1147-48
(2d 	Cir. 	1983); 	Tri-Star 	Pictures, 	Inc. 	v. 	Unger, 	42 	F. 	Supp. 	2d
296, 	302 	(S.D.N.Y. 	1999). 	The 	reasonable 	hourly 	rates 	are 	the
prevailing 	rates 	for 	similar 	services 	by 	lawyers 	of 	reasonably
comparable 	skill, 	experience 	and 	reputation 	in 	the 	relevant
market–-here, New York City. 	Id.; Sucre v. MIC Leasing Corp. (In
re 	Sucre), 	226 	B.R. 	340, 	352 	(Bankr. 	S.D.N.Y. 	1998); 	see 	Blum 	v.
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Stenson, 	465 	U.S. 	at 	895 	& 	n.11. 	If 	the 	applicant 	carries 	its
burden, the “lodestar” amount is presumed to be the reasonable fee.
Blum v. Stenson, 465 U.S. at 897.
B. 	MetTel’s Application
MetTel has proven the reasonableness of the fee and expenses
sought. 	Its submissions demonstrate that its attorneys (and non-
attorneys) actually performed the services identified in the time
records, that the work was reasonable and necessary and that it was
billed at the usual rates.
1. 	Duane Morris
a. 	Fran M. Jacobs
The debtor objected to Ms. Jacobs’s hourly billing rate. 	The
debtor 	does 	not 	contend 	that 	her 	rate 	is 	above 	market 	or
unreasonable, considering that she has practiced as an attorney for
over 	twenty 	years, 	and 	is 	a 	partner 	in 	a 	substantial 	firm.
Instead, the objection is based on the billing rate allowed by the
Special 	Referee. 	The 	Special 	Referee 	took 	no 	evidence 	regarding
billing 	rates. 	Instead, 	he 	reasoned 	that 	“[c]alling 	upon 	my 	own
experiences 	in 	hearing 	very 	many 	cases 	of 	this 	nature, 	I 	believe
that 	a 	proper 	hourly 	rate 	for 	the 	entire 	period 	for 	the 	lead
counsel is $350.00.” 	(Debtor’s Objection, Ex. A, at 3.)
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Initially, 	I 	should 	reiterate 	that 	I 	am 	not 	being 	asked 	to
review 	the 	Special 	Referee’s 	recommendations, 	but 	rather, 	later
services 	relating 	to 	the 	same 	state 	court 	case. 	The 	Special
Referee’s 	determination, 	in 	this 	regard, 	is 	neither 	binding 	nor
persuasive. 	He 	took 	no 	evidence 	on 	the 	appropriate 	fee, 	and 	did
not identify the facts that supported his conclusion. 	Furthermore,
the debtor declined my offer of an evidentiary hearing, and did not
submit 	any 	evidence 	regarding 	a 	different 	rate 	for 	Ms. 	Jacobs.
Duane Morris billed MetTel at the firm’s usual and customary rates,
and there is no basis to deviate from the “lodestar” amount.
b. 	Francine Nisim
The debtor challenged Ms. Nisim’s time charges on two grounds;
she duplicated what Ms. Jacobs did, and spent too much time dealing
with an adjournment. 	The debtor failed, however, to rebut MetTel’s
proof, 	or 	show 	that 	Nisim 	performed 	unreasonable 	or 	unnecessary
services.
The duplication argument is based on the fact that Nisim and
Jacobs worked together on the same sets of papers. 	Yet it is not
unusual for more than one attorney to participate in the drafting
of 	a 	brief, 	see 	Bleecker 	Charles 	Co. 	v. 	350 	Bleecker 	St. 	Apt.
Corp., 212 F. Supp. 2d 226, 230 n.5 (S.D.N.Y. 2002), particularly
where the younger attorney does the research and initial drafting
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and the senior attorney reviews and edits her work. 	See Ursa Minor
Ltd. v. Aon Fin. Prods., No. 00 Civ. 2474, 2001 WL 1842042, at *6
(S.D.N.Y. 	May 	30, 	2001); 	Harb 	v. 	Gallagher, 	131 	F.R.D. 	381, 	387
(S.D.N.Y. 1990). 	In one instance cited by the debtor, Nisim spent
seven 	hours 	drafting 	an 	affidavit 	in 	opposition 	to 	the 	debtor’s
motion 	for 	leave 	to 	appeal 	to 	the 	Court 	of 	Appeals. 	Jacobs 	then
spent 	four 	hours 	reviewing 	and 	editing 	it. 	(Jacobs 	Reply
Affidavit, at ¶ 8.) 	As noted, this is an appropriate division of
labor.
In 	the 	other 	example 	identified 	by 	the 	debtor, 	Nisim 	billed
$3,220.00 researching and drafting the response to a specific issue
first 	raised 	on 	appeal 	by 	the 	debtor 	concerning 	the 	primary
jurisdiction of the New York Public Service Commission. 	(Id., at
¶¶ 5-6.) 	Jacobs spent three-tenths of one hour reviewing Nisim’s
work, 	and 	the 	rest 	of 	her 	time 	dealing 	with 	the 	balance 	of 	the
debtor’s brief. 	(Id., at ¶ 6.) 	As MetTel correctly observed, much
of Nisim’s fees could have been avoided entirely if the debtor had
not 	belatedly 	raised 	a 	meritless 	primary 	jurisdiction 	argument,
forcing MetTel to respond.
Finally, 	Nisim 	did 	not 	spend 	an 	excessive 	amount 	of 	time
grappling with an adjournment. 	After the debtor filed a brief and
a 	defective 	record 	on 	appeal, 	MetTel 	submitted 	a 	supplemental
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appendix to cure the defects. 	(Id., at ¶ 10 & Ex. B.) 	Best then
moved, on an emergency basis, to strike the supplemental appendix
or to serve a new brief. 	(Id., at ¶ 11.) 	Nisim spent three hours
addressing 	the 	debtor’s 	emergency 	motion, 	and 	appearing 	in 	the
Appellate Division to respond to it. 	(Id., at ¶ 12.)
c. 	The Managing Clerk
Finally, the debtor objected to the award of $1,400.00 for the
services performed by Duane Morris’ managing clerk’s office. 	Once
again, the sole ground for the objection was the Special Referee’s
refusal 	to 	award 	the 	managing 	clerk 	costs. 	The 	Special 	Referee
reasoned 	that 	“I 	never 	in 	all 	my 	years 	of 	experience 	in 	handling
cases of this nature ever heard a claim for services by a managing
clerk.” 	(Debtor’s Objection, Ex. A, at 3-4.)
With 	respect, 	I 	reach 	a 	different 	conclusion. 	Here, 	the
managing 	clerk’s 	office 	checked 	the 	court 	file 	for 	the 	status 	of
pending 	matters, 	and 	retrieved 	copies 	and 	filed 	papers. 	(Jacobs
Reply 	Affidavit, 	at 	¶ 	17.) 	Paralegals 	and 	even 	lawyers 	do 	the
same, 	and 	there 	is 	no 	reason 	to 	deny 	compensation 	for 	a 	managing
clerk’s activities that are performed for a specific client and are
reasonable and necessary, as these services were. 	Finally, Duane
Morris routinely bills its clients directly for the work performed
by the managing clerk, and this occasion was no exception. 	(Id.,
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at ¶ 19.)
In summary, the objections to Duane Morris’s fees and expenses
are overruled. 	If it appears to the debtor that the firm spent too
much 	time 	performing 	legal 	services, 	it 	is 	only 	because 	of 	the
post-judgment 	litigation, 	largely 	meritless, 	that 	the 	debtor
initiated. 	Perhaps 	the 	debtor’s 	litigation 	strategy 	should 	have
factored 	in 	the 	fee-shifting 	provisions 	of 	the 	Agreement 	when 	it
made so many motions. 	Its failure to do so foisted additional work
on Duane Morris, and it is obligated to pay for that work.
2. 	Tobias’s Fees
Tobias 	provided 	collection 	services 	and 	advice 	during 	the
approximate 	three 	week 	gap 	between 	the 	docketing 	of 	the 	money
judgment 	and 	the 	posting 	of 	the 	appeal 	bond. 	The 	debtor 	did 	not
contest 	his 	$225.00 	per 	hour 	billing 	rate. 	Instead, 	the 	debtor
argued that Tobias performed unreasonable and unnecessary services
in 	two 	instances. 	First, 	Tobias 	prepared 	a 	motion 	to 	appoint 	a
receiver, 	but 	did 	not 	file 	it. 	Second, 	Tobias 	worked 	with 	Duane
Morris to oppose the debtor’s motion, brought on by order to show
cause, to stay further collection after the debtor had posted the
undertaking. 	(Tobias Declaration, at ¶ 8.)
The 	Court 	concludes 	that 	the 	receiver-related 	work 	was 	both
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reasonable 	and 	necessary. 	Although 	Tobias 	had 	served 	property
executions, 	(id., 	at 	¶ 	3), 	he 	was 	worried 	that 	they 	would 	not 	be
effective. 	The 	debtor’s 	assets 	consisted 	of 	900 	payphones
scattered throughout the City, and the coins in the phones did not
pass 	through 	the 	debtor’s 	bank 	accounts. 	(Id., 	at 	¶¶ 	4-5.)
Consequently, 	he 	prepared 	a 	motion 	to 	appoint 	MetTel 	to 	act 	as
receiver 	of 	the 	debtor’s 	business. 	(Id., 	at 	¶ 	6 	& 	Ex. 	A.) 	The
application was not filed because the debtor posted the undertaking
on or about May 30, 2001. 	(Id., at ¶ 6.)
The 	reasonableness 	and 	necessity 	of 	the 	attorneys’ 	services
must 	be 	viewed 	in 	foresight, 	not 	hindsight. 	The 	test 	is 	“what
services a reasonable lawyer or legal firm would have performed in
the 	same 	circumstances.” 	In 	re 	Ames 	Dep’t 	Stores, 	Inc., 	76 	F.3d
66, 	72 	(2d 	Cir. 	1996)(discussing 	fee 	awards 	under 	the 	Bankruptcy
Code). 	Tobias 	identified 	unique 	problems 	with 	enforcing 	the
judgment 	in 	light 	of 	the 	nature 	of 	the 	debtor’s 	assets 	and 	its
business, 	and 	drafted 	the 	receiver 	motion 	with 	those 	problems 	in
mind. 	The 	debtor 	never 	told 	MetTel 	that 	it 	intended 	to 	file 	a
bond, or provided MetTel with a reason to believe that it would pay
the 	judgment 	or 	that 	it 	would 	be 	collectible 	without 	the 	need 	to
take the steps contemplated by Tobias.
Similarly, 	Tobias’s 	work 	researching 	the 	adequacy 	of 	the
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debtor’s 	undertaking 	was 	reasonable 	and 	necessary 	because 	the
debtor 	had 	posted 	an 	inadequate 	appeal 	bond. 	In 	fact, 	MetTel’s
opposition led to an increase of $12,000.00 in the bond.
Accordingly, the debtor’s objections are overruled, and MetTel
is 	awarded 	$53,308.40 	in 	fees 	and 	expenses 	as 	requested 	in 	its
application. 	Settle order on notice.
Dated: 	New York, New York
April 21, 2005
/s/ Stuart M. Bernstein
STUART M. BERNSTEIN
Chief United States Bankruptcy Judge
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