CALIFORNIA ATTORNEY'S FEES

Bankruptcy: Reasonable Costs Of Disciplinary Proceedings Imposed On California Lawyer Were Nondischargeable; However, Discovery Sanctions Payable To A Party Were Dischargeable

End Result Was $18,714 Was Nondischargeable, But $5,738 Was Dischargeable.

            In In re Albert-Sheridan (Albert-Sheridan v. California State Bar), No. 19-60023 (9^th Cir. June 10, 2020) (published), a disciplined California lawyer was ordered by the State Bar to pay $18,714 in costs for the disciplinary proceeding and to pay a client’s opponent $5,738 in discovery sanctions as conditions to lifting her suspension.  Lawyer filed a Chapter 13 bankruptcy, later converted to a Chapter 7, trying to discharge all of the costs and discovery sanctions.  The bankruptcy court said “no,” but the Ninth Circuit said “no” and “yes.”  With respect to the State Bar disciplinary costs, those were nondischargeable.  But, a different result as to the discovery sanctions:  in a first impression issue, the federal appellate court determined they were dischargeable in light of the fact they were not payable to a governmental entity. 

Bankruptcy, In The News . . . . Four Outside Bankruptcy Law Firms Seeking Approval Of $84 Million In Fees Since PG&E’s January 2019 Bankruptcy Filings

Filings Also Show Hourly Rates Being Claimed.

            As reported by NALTA in an April 2, 2019 post, four outside bankruptcy firms have requested approval of around $84 million in fees for work on Pacific Gas & Electric Company’s bankruptcy case, which was filed in January of this year. Based on its summary of public court filings, NALTA reports that Cravath attorneys are charging at rates of $415 to $1,500 per hour; Weil attorneys charge $560 to $1,600 per hour; Jenner & Block attorneys charge PG&E at hourly rates ranging from $400 to $982; and Keller & Benvenutti attorneys are charging at $400 to $800 per hour.

Bankruptcy, Substantiation Of Reasonableness Of Fees: Debtor Is Entitled To Attorney’s Fees And Costs For Challenging A Willful Automatic Stay Order On Appeal

Debtor Also Properly Allocated Fees To Work On Appeal, Such That A Procedural Basis For Denying Fees And Costs Was Infirm.

            In In re Schwartz-Tallard, 803 F.3d 1095, 1101 (9th Cir. 2015) (en banc) [discussed in our April 17, 2014 post], the Ninth Circuit earlier held that 11 U.S.C. § 362(a) authorizes the court to award reasonable attorney’s fees and costs incurred on appeal to a debtor defending a willful automatic stay violation judgment pursuant to § 362(k). This same circuit court of appeals, in Easley v. Collection Service of Nevada, No. 17-16506 (9^th Cir. Dec. 20, 2018) (published) has now extended that logic and fees/costs entitlement to encompass the situation where a debtor successfully challenges an initial award pursuant to § 362(k) on appeal. Furthermore, it rejected a district judge’s sustaining of a procedural objection that the debtor did not properly segregate work just on appeal, with the record showing it was an abuse of discretion to so conclude based on the substantiating time entries and accompanying memorandum of points and authorities.