Allocation, Multipliers, Section 1717, Substantiation Of Reasonableness Of Fees: Reversal And Remand Were In Order Where Trial Court Believed It Did Not Have Authority To Apply A Negative Multiplier In An Award Of Attorney Fees

Invoices Submitted In Support Of Plaintiff’s § 1717 Fees Motion Were Extensively Redacted And Contained Vague Block-Billing, Which Offered The Trial Court No Way To Meaningfully Apportion Time Between Causes Of Action.

            After defeating defendant’s cross-claim breach of contract cause of action, plaintiff moved for Civ. Code § 1717 attorney fees of $939,600.50, which represented all of plaintiff’s incurred fees from the time defendant amended their cross-complaint to add the breach of contract cause of action.  In opposition, defendant argued that a negative multiplier should be applied based on the extensive redactions and block-billing of the invoices submitted by plaintiff in support of its fee motion, which offered the trial court no way to meaningfully apportion time between causes of action.  Defendant argued that no more than $47,980.20 should be awarded to plaintiff.  The trial court rejected defendant’s negative multiplier argument and awarded plaintiff $369,811.50 after reductions to one attorney’s hours, hourly rate reductions, and further reductions for apportionment and excessiveness.

            Defendant appealed, and the 2/1 DCA reversed in Southern Cal. School of Theology v. Claremont Graduate University, Case No. B302452 (2d Dist., Div. 1 May 3, 2021) (unpublished). 

            The trial court appeared to have rejected defendant’s proposed negative multiplier based on its belief it had no authority to apply defendant’s requested negative multiplier.  However, a trial court has considerable discretion in determining fee awards, including its authority to ““assig[n] a reasonable percentage to [time] entries, or simply cast them aside.” (Bell v. Vista Unified Sch. Dist., 82 Cal.App.4th 672, 689 (2000).)  The court may reduce compensation on account of any failure to maintain appropriate time records as the party moving for fees bears the burden of establishing entitlement and documenting the appropriate hourly rate and hours expended. (ComputerXpress, Inc. v. Jackson, 93 Cal.App.4th 993, 1020 (2001).)

            On remand, the panel instructed the trial court to reconsider its order based on its full authority to fashion a fees award under § 1717 – reminding the trial court it has the authority to apply a negative multiplier as a basis to apportion fees.