Employee Did Prevail On Employer’s Contract Claims, But Lower Court’s Reduced Fee Award For Prevailing On Labor Code Claims Was No Abuse Of Discretion—Given Attorney Intervenors Did Timely Appeal And Contest Merits Based On Their Attorney’s Lien Interest In Fees/Costs Awards.
This next case, Premier Mechanical Group, Inc. v. Harvey (Edwards), Case No. D075663 (4th Dist., Div. 1 Jan. 20, 2021) (unpublished), is procedurally complicated, but confronted numerous issues on appealability, prevailing party, and reduced Labor Code fee award issues.
There, former employer and former employee got involved in a real ado centering on employee’s return and use of documents on a jump drive, inspiring various contract/tort claims by employer as plaintiff and primarily Labor Code claims by employee as cross-complainant. Employee was represented by counsel during some phases of the litigation. Eventually, a jury found against employer on its contract claim (finding a breach, but no damages), but awarding employer $95,000 on a non-contract unlawful audio/video recording claim against employee. On the cross-complaint, the jury found employer had failed to pay employee for all work performed, awarding $1,940, although finding against employee on the remaining cross-claims. Employee then moved to recover over $1 million in attorney’s fees and $57,039 in costs as the prevailing party under both the complaint and cross-complaint. The lower court did not believe employee prevailed under the contract on the complaint and awarded $10,500 in reduced fees on the cross-complaint. $57,039 in statutory and nonstatutory costs also were awarded to employee. That provoked a lot of appeals, with employee’s attorney filing a notice of attorney’s lien against the client’s monetary recoveries and with employee then proceeding in pro per. Employer then successfully moved to strike the costs award in entirety. Employee’s substituted-out attorneys then moved to intervene for purposes of protecting their rights to recover attorney’s fees and costs in the litigation, which was eventually granted after employee in pro per and employer reached a settlement. Attorneys filed appeals, as proposed intervenors, of various fee and costs rulings, with the lower court granting the motion to intervene to address claims for fees and costs against employer but not to seek any relief from employee. However, the lower court did amend the fees order to direct the fees paid to the attorneys rather than employee. Another appeal followed by employee’s attorneys.
Employer moved to dismiss the attorneys’ appeal, but that was denied. As intervenors, the attorneys had an independent right to pursue fees and costs, no matter what settlement was reached between employee (former client) and employer. Their notice of appeal was timely based on the prior entry of judgment not including the fees/costs order and based on the fact that the new order awarding them fees and costs as intervenors, later, was independently appealable. The fact that the case, as pled, was unlimited civil in nature did not mean an appeal had to be made to the superior court appellate division; the DCA had appellate jurisdiction.
On the merits, the 4/1 DCA panel decided that prior orders on fees and costs could be revisited by attorneys because the later order directing fees/costs to them was a substantial modification which was independently appealable. The lower court erred in not awarding fees and costs to employee (which would be for the benefit of her counsel filing the attorney’s lien) on employer’s complaint because employee beat contract claims, with the unlawful recording claim being a non-contractual claim. Given that fact, the prior order vacating costs had to be considered in fairness to the intervenor attorneys. With respect to the Labor Code attorney’s fees award, the reduction by the lower court was reasonable, compensating for 30 hours of work at the rate of $350 per hour. Nothing demonstrated that the lower court’s apportionments and reductions were out of line under an abuse-of-discretion standard. Remand ordered to the superior court on fees and costs to employee’s attorneys on employer’s contract-based complaint claim.
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