Rouse v. H.B. Fuller Company

Background

This is a class action lawsuit in which Plaintiffs allege breach of warranty and misrepresentations by H.B. Fuller Company and H.B. Fuller Construction Products Inc. (collectively, 'H.B. Fuller') regarding a product called Power Grout. In November 2024, H.B. Fuller sold its Power Grout business to TEC Specialty, LLC, a non-party to the litigation, which was set up by its parent company Pacific Avenue Capital Partners ('PACP').

In January 2025, the court reopened fact discovery in a strictly limited scope, allowing Plaintiffs to seek only a narrow subset of documents from Defendants about the sale. Despite this limitation, on April 11, 2025, Plaintiffs served a deposition subpoena on TEC Specialty covering more than 20 topics, most of which exceeded the scope of the court-authorized discovery. Plaintiffs also served a separate subpoena on PACP, which was later withdrawn after counsel negotiations.

Because the TEC Specialty deposition was noticed for a location in northern Illinois, TEC Specialty filed a motion to quash in the U.S. District Court for the Northern District of Illinois, also requesting transfer to Minnesota. Judge Edmond E. Chang (N.D. Ill.) granted the transfer. TEC Specialty then filed a motion to quash in the District of Minnesota.

At the May 16, 2025 hearing, the court granted TEC Specialty's motion to quash in full, describing the subpoena as 'an impermissible end run around the Court's ruling on the scope of relevant and proportional discovery.' The court also noted this was 'part of a pattern' of improper litigation conduct and invited TEC Specialty to submit a motion for fees and costs.

TEC Specialty's Fee Request

TEC Specialty sought $107,803.95 total: - $17,395.65 for work on the PACP subpoena - $52,914.60 for work on the TEC Specialty subpoena in N.D. Ill. - $37,493.70 for work on the TEC Specialty subpoena in D. Minn.

TEC Specialty's lead counsel, O'Melveny & Myers, billed at $1,489.50/hour (partner) and $954/hour (associate). Local counsel Fredrikson & Byron billed at $710/hour (partner) and $484/hour (associate).

Legal Standards Applied

Analysis and Holdings

1. PACP Subpoena Fees — DENIED ($17,395.65)

The PACP subpoena was issued, objected to, and voluntarily withdrawn without any court involvement. The court held that awarding fees for work performed in connection with a dispute resolved through negotiation would undermine the policy of encouraging out-of-court resolution. Once a dispute is closed by negotiation, it should not be reopened to award fees.

2. Work Performed in N.D. Ill. — DENIED ($52,914.60)

The court declined to award fees for work TEC Specialty's counsel performed while the motion to quash was pending in Illinois. The court noted — seconding Judge Chang's observation — that TEC Specialty could have avoided the extra procedural step of the N.D. Ill. filing by simply asking this court (D. Minn.) to hear the dispute directly, as TEC Specialty was both seeking to quash the subpoena and to transfer the case to Minnesota. This extra process likely generated unnecessarily duplicative billing. The court found awarding these fees would not be within the bounds of Rule 45.

3. Work Performed in D. Minn. — GRANTED ($21,053.20)

The court found sanctions mandatory under Rule 45(d)(1): Plaintiffs' counsel took no reasonable steps to avoid burdening TEC Specialty. Instead, after being allowed only limited written discovery from Defendants, counsel served a broad deposition subpoena on a non-party covering topics the court had already placed out of bounds. The court analogized this to 'being turned down for a $5 loan and then asking for a $100 loan.'

On the amount: O'Melveny & Myers's rates ($1,489.50–$954/hour) were found unreasonable for this forum. The court applied the Fredrikson & Byron rates as the reasonable local rates. Because the billing records did not break down hours by individual attorney, the court calculated an overall blended rate for each firm: O'Melveny & Myers billed $30,949.20 for 28.4 hours (implying ~$1,089.76/hour, suggesting associate-heavy work); Fredrikson & Byron billed $6,544.50 for 12.8 hours (implying ~$511/hour, also suggesting associate-heavy work). The court applied the $511/hour blended Fredrikson & Byron rate to all 41.2 hours of D. Minn. work (28.4 + 12.8 hours), yielding $21,053.20.

4. Discretionary Sanctions Payable to Defendants — ORDERED ($8,946.80)

Separately, and in addition to the TEC Specialty award, the court exercised its inherent authority to impose discretionary sanctions on Plaintiffs' counsel, ordering payment of $8,946.80 to the H.B. Fuller Defendants for fees and costs associated with the motion to quash and related litigation. The court cited the long pattern of bad-faith, vexatious, and unprofessional litigation conduct by Plaintiffs' lead counsel (identified as Mr. Hine of Vorys, Sater, Seymour and Pease) and named a member of H.B. Fuller's legal team (Mr. Root) as equally responsible for the overall tenor of the litigation.

Key Limitation on Fee Awards

The court expressly ordered that all payments must be made by Plaintiffs' lead counsel and his law firm, Vorys, Sater, Seymour and Pease — not passed on to the Plaintiffs themselves or factored into any settlement in a way that would reduce Plaintiffs' potential recovery for their alleged harms.