Plaintiff Did Beat 998 Offer When These Components Added to Damages, Justifying An Award of $158,822.85 In Discrimination/Wage and Hour Case Where Base Compensatory Damages Were $21,270.88.
As we know from studying cases under the “Employment” category, FEHA and certain Labor Code provisions have mandatory fee-shifting provisions, especially ones tilted in favor of a prevailing plaintiff employee. In this next case, plaintiff certainly prevailed but the dispositive question was whether he beat the defense Code of Civil Procedure section 998 offer. He did.
Gutierrez v. The Odd Fellows Homes of California, Inc., Case No. 132836 (1st Dist., Div. 4 Sept. 28, 2012) (unpublished) is a situation where plaintiff prevailed is an overtime/holiday wage and meal/rest break case to the tune of $21,270.88 based on a jury verdict on the overtime/holiday wage claims. Earlier, however, the defense had served a 998 offer in the amount of $22,001.00 “plus reasonable attorney fees and costs as of the date of the offer in an amount to be agreed upon by the parties or determined by the Court according to proof ....” Later on, the trial court determined that prejudgment interest of $9,130 was a cost not to be counted against the 998 offer but that waiting time penalties of $4,936.80 was a part of the compensatory award that should be added to the jury verdict as far as computing whether plaintiff beat the 998 offer--meaning plaintiff did beat the $22,001 offer when the $4,936.80 penalty was added to the $21,270.88 jury award. That led to the lower court granting plaintiff attorney’s fees totaling $158,822.85, postjudgment interest, and costs of $20,560.12.
Defendant’s appeal, based on the claim its 998 offer beat plaintiff’s award, did not succeed on appeal.
The appellate court agreed that the waiting time penalties were not in the nature of costs, because (1) they were akin to additional wages, and (2) they are mandatory, unlike most costs which are discretionary in nature. Beyond that, the lower court erred in not allocating some of the prejudgment interest award as part of the judgment (rather than saying it was in the nature of a cost) given that Labor Code section 218.6 supports that characterization, bolstered by the reasoning in Bodell Construction Co. v. Trustees of Cal. State University, 62 Cal.App.4th 1508, 1526 (1998) [Civil Code section 3287(a) prejudgment interest was a form of compensatory damages; preoffer interest was not a cost, while postoffer interest was a cost]. Thus, when adding the waiting time penalties and some allowable portion of the prejudgment interest to the base jury award, plaintiff indeed did beat the 998 award, sustaining the award of fees and costs by the court below.
San Francisco Odd Fellows Cemetery. 1899.
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