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Lost Arbitration Case through Citibank - Citibank is now asking arbitrator for unreasonable attorney fees - need help!


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Hello Everyone,

First of all I want to thank everyone for posting and contributing to this forum. Thanks to the information I got on here, I was able to get a case dismissed against me in a credit card lawsuit against a junk debt buyer by compelling private arbitration.

However, I also compelled private arbitration with an original creditor Citibank, and the case did not go my way. I did my best to fight Citibank in AAA and lost. The arbitrator recently gave the creditor/attorney an interim award of about $2,800 for the credit card balance they claim I owed.

Now, the attorney is asking for attorney fees that are over double of what the balance was they claim I owed. I can file an objection to the ask for attorney fees, but I was wondering if anyone had any insight on how to fight these with Citibank's lawyer getting unresonable attorney fees. Any case law or any insight that might help me at least defeat the attorney's motion for attorney fees would be greatly appreciated.

My intention is to file bankruptcy before any judgement is finalized against me, but I would still like some information on how to fight this case. I greatly appreciate any insight you all may provide.

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Are they also going after the fees or just attorney cost? What state does the contract say govern's  will be on contract?  I know UTAH has a listing of reasonable attorney fees online I was looking at it yesterday. Search to see if you can find such a list for the governing state on your contract. 

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$6k for attorneys fees is not inherently unreasonable, considering you took them to arbitration. You can make an argument in court that it is unreasonable, but there's a lot of AZ case law on the subject, and I'm sure they will have all of the documentation to show the time they spent on the case. If you do go to court, one thing you should ask for is the agreement between the attorney and Citibank.  I'm not sure how it works with OCs, but JDBs often have capped fee agreements with their counsel, and it would be illegal to ask for fees in excess of what Citi actually paid their attorney. Asking and getting are two different things, though. The court will probably find that the agreement is covered by attorney-client or some other privilege. 

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Does your arbitration clause with Citibank include any language that would prevent Citibank from seeking attorney's fees?  The arbitration clauses I've dealt with have specified who is responsible for covering which fees/costs.

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On 7/19/2022 at 2:19 PM, ihatecitibank said:

Now, the attorney is asking for attorney fees that are over double of what the balance was they claim I owed.

The average rate per hour for any attorney to handle a litigation or arbitration case all the way to the end is $300.  Given the amount of time spent filing the original lawsuit, answers to the MTC, and then arbitration 30+ billable hours would not be unheard of.  That hourly fee can actually increase if they actually have to appear in court or arbitration.  High end firms can charge as much as $500-750 an hour.  Time spent on a client's case is billed in quarter hour increments and can add up quickly.  ANY paper work they do, any time researching case law, any phone conversations discussing the case with the client etc. all add to billable time.  It is why most law firms expect a $10k or more retainer to cover the initial expenses of handling a legal matter involving the courts and as that gets utilized the client may be expected to add to that trust account to cover the costs.  

What they cannot do is just say to the arbitrator or court is "we want $15k in attorney fees" and not back it up.  Both arb and court will require a copy of the bill sent to the client indicating expenses for copies, filing fees etc along with the hours spent/billed and total charges.  Both arbitration and the courts are well versed in what a suitable amount of hours and expenses would be for the type of case in front of them.  It is rare to see them tell the side seeking them to be awarded that they are excessive as they are heavily scrutinized and rarely padded at the risk of sanctions.  

22 hours ago, Harry Seaward said:

If you do go to court, one thing you should ask for is the agreement between the attorney and Citibank.  I'm not sure how it works with OCs, but JDBs often have capped fee agreements with their counsel, and it would be illegal to ask for fees in excess of what Citi actually paid their attorney. Asking and getting are two different things, though.

ZERO chance the court or arbitration enforces this.  It is a clear violation of attorney client privilege.  The answer to this demand is that the Plaintiff is required to produce a copy of the actual bill from the law firm.  That is not protected information when seeking reimbursement.  A large creditor like CITI likely has an annual agreement with the law firm to handle a specific amount of cases for the global fee.  Even with a fee agreement like this the law firm will still track the billable hours and expenses because the global fee is based upon an average billable time for the type of cases (debt collection) being handled and if there is an outlier that is taking far longer then they will need accurate documentation as to why they would seek greater fees than the global charge.  For cases that are expedited and handled quickly they either charge the global average or slightly less.  An example would be if a creditor is suing for a defaulted card with a balance of $953 and the consumer goes to trial but loses, the fees sought as part of the award would likely be reduced from the $5000 global charge to $750-1000 because little time was spent getting to that judgment.  For a case that goes to trial for a $5k debt or more large attorney fees are not unusual at all.

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6 minutes ago, Clydesmom said:

ZERO chance the court or arbitration enforces this.  It is a clear violation of attorney client privilege.

Thank you for repeating exactly what i already said, but mysteriously leaving that part of what i said out of what you quoted.

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