Mediation: Less Than Compulsory Mediation Clause Was Satisfied Even Though Cross-Complaint Filed Without Additional Mediation By Prevailing Party Actually Participating In Mediation On The Complaint

Fee Award Of $375,813 In Capital Call Dispute Affirmed In Favor Of Prevailing Party.

            Ocean Tomo, LLc v. PatentRatings, LLC, Case Nos. G055429/G056063/G056829 (4^th Dist., Div. 3 June 13, 2019) (unpublished) shows how the wording of a mediation condition precedent clause can be determinative with respect to fee qualification.

            A prevailing party in a capital call dispute won attorney’s fees totaling $375,813 under an LLC Operating Agreement fees clause stating that LLC members “pledge to attempt to resolve any dispute amiably without the necessity of litigation.”  The facts demonstrated that the prevailing party participated in mediation before the plaintiff/minority LLC member filed suit but did not mediate further before the prevailing party filed a cross-complaint.  Losing party argued the mediation provision was not complied with on appeal.  Not so.

            The 4/3 DCA, in an opinion authored by Justice Fybel, affirmed the fee award.  The “pledge to attempt” language was not akin to mandatory mediation language like that in CAR form contracts.  Aside from that, prevailing party did participate in mediation sessions such that his filing of a cross-complaint months later did not fall outside of the spirit of “ADR attempt” resolution language contained in the fees clause.