CALIFORNIA ATTORNEY'S FEES

Block Billing, Multipliers, Reasonableness Of Fees: Plaintiff’s Counsel’s Inflated Fee Request In A Non-complex FEHA Case Where Block Billing And Failure To Explain Proliferation In Fees For A Six Month Period Through Trial Justified A Drastic Reduct

Fee Request Was About $1.75 Million In A Case Where $36,757.25 In Damages Was Awarded, With A Lower Court Awarding Only $135,102.

               Inflated fee requests are often reduced substantially and sometimes denied altogether.  In the next case, block billing, failure to explain a huge jump in the fee request for a six-month period, use of an excessive hourly rate, and unreasonable work efforts all coalesced to lead to a substantially reduced fee award, one affirmed in Howell v. Dept. of State Hospitals, Case No. A168526 (1^st Dist., Div. 2 Nov. 7, 2024) (unpublished).

               There, plaintiff brought a FEHA suit and won just $36,757.25 in lost earnings and health benefits after three years of litigation and a two-week jury trial.  Plaintiff sought about $1.75 million in fees, inclusive of a 1.75 positive multiplier.  On various grounds, the lower court determined that the fee request was inflated so as to justify a reduction to just $135,102.  The appellate court affirmed that determination, presenting some nice takeaways for litigants/attorneys in attorney’s fees law and motion proceedings:

• • • Block billing – Plaintiff’s counsel block billed which prevented the trial judge from doing a reasonable audit of what fees were appropriate.
    • Unreasonable time – Plaintiff sought recovery for unreasonable work effort for overlitigating the case, examples being time spent on 19 unsuccessful motions in limine and hours combating a physical exam request even though plaintiff was claiming pain and suffering.
    • Lack of complexity – Plaintiff was requesting a large number in a case where the issues were not that complex.
    • Excessive hourly rates—Plaintiff’s counsel requested larger hourly rates based on a Napa County venue for the case, which were higher than counsel’s San Joaquin County home rate and which was reviewed by the lower court as a “surreptitious” multiplier request.
    • Discrepancy in explaining the final large number—In a January 2023 settlement conference statement, plaintiff claimed to have expended $123,101.95 in fees/costs, and counsel could not explain the $1 million proliferation in the request for the six months between January-July 2023.
    • Denial of a multiplier against an entity funded by taxpayers—It is proper for a lower court to deny based on a taxpayer status consideration.
    • Inflated fee requests are a special concern allowing for reduction or denial—See Chavez v. City of Los Angeles, 47 Cal.4^th 970, 990 (2010).

Lodestar, Multipliers: Lower Court’s Reducing Hours/Hourly Rate For Two Attorneys/One Paralegal And Not Applying A Positive Multiplier Was No Abuse Of Discretion In Routine FEHA Employment Case

Trial Judge Applied The Correct Lodestar And Multiplier Factors, Awarding Plaintiff’s Attorneys $1,054,494 In Fees Under FEHA.

               In Young v. Dept. of Public Social Services, Case No. B329748 (2d Dist., Div. 5 Sept. 6, 2024) (unpublished), plaintiff won $3.5 million in damages on a retaliation claim, but plaintiff’s attorneys sought a $1.498 million lodestar augmented by a 2.5 positive multiplier, for a total fee award of over $3.745 million.  After a contested fee motion, the lower court reduced the hourly rates of two attorneys (from $795 to $600 for a more senior attorney and $750 to $550 for a younger attorney) and the hourly rate of a paralegal (from $250 to $150), pared some hours, and denied the multiplier request.  The total fee award was $1,054,494.

               The 2/5 DCA affirmed under the deferential abuse of discretion standard.  The defense expert provided some context for reduced rates, such that the hourly rates awarded were not irrational.  Although the case was taken under a contingency arrangement, the lower court’s perception that the lodestar also captured the multiplier factors was not unreasonable given that the matter was a routine FEHA case with no novel issues—otherwise, all FEHA contingency cases would automatically result in a multiplier.

Class Actions, Multipliers, Private Attorney General, Reasonableness Of Fees: $1.174 Million Award To Class Counsel In Fair Debt Collection Practices Case Affirmed On Appeal

Significant Benefit Incurred, If Injunctive Relief Was Considered, And Other Objections Were Not Specific To Justify Any Reduction.

               In Doskocz v. ALLS Lien Services, Case No. A166299 (1^st Dist., Div. 1 May 20, 2024) (partially published; fee discussion unpublished), class counsel prevailed on behalf of plaintiffs in case involving some novel and complex issues under the Fair Debt Collection Practices Act and unrelated case.  Class counsel moved for $1.174 million in attorney’s fees, inclusive of a 1.25 multiplier, being granted the full request.  The defense appealed, but to no avail.  A significant benefit was incurred, when both limited monetary and injunctive relief were considered in tandem.  Many other requested defense reductions were not supported with sufficient detail.  A multiplier was justified based on the factors found relevant by the lower court with respect to novel and complex issues.  The defense could not surmount the abuse of discretion standard applied to the fee issues at play.

Ethics, Lodestar, Multipliers: Snoeck Opinion Now Published

Message Is That Incivility Can Lead To A Negative Multiplier To A Fees Request, On Top Of Other Reductions.

            On October 3, 2023, we posted on Snoeck v. ExakTime Innovations, Case No. B321566 (2d Dist., Div. 3 Oct. 2, 2023 unpublished), but it was certified for publication on October 25, 2023.  The main lesson from this case is that appellate courts will have no trouble affirming a lodestar request reduction, aside from other deductions, separate for the incivility of the party requesting a fee award where the record supports such a reduction for incivility.

Ethics, Lodestar, Multipliers: Lower Court Properly Applied A .4 Negative Multiplier To A FEHA Fee Request Based On Plaintiff’s Counsel’s Incivility Throughout The Litigation

2/3 DCA Agreed With The Reasoning In Karton.

            More and more, we are seeing appellate opinions, whether published or not, stressing the need for civility among attorneys in litigation cases.  In fact, there are proposals being considered which would require that California attorneys, annually, have to reaffirm their oath and to confirm they will act with civility.  In Karton v. Ari Design & Construction, Inc., 61 Cal.App.5^th 734, 747 (2021), the 2/8 DCA held that incivility can allow a lower court to reduce a fee request, with it being an “incentive for counsel in fee-shifting cases to know their own low blows may return to bite them in their pocketbook.”

            Karton was followed and endorsed by the 2/3 DCA in Snoeck v. ExakTime Innovations, Case No. B321566 (2d Dist., Div. 3 Oct. 2, 2023) (unpublished).

            There, a FEHA disability discrimination plaintiff won $130,080 in damages on one out of six causes of action for defendant’s failure to engage in an interactive process.  The lower court took the lodestar request and initially made a 20% reduction for overstaffing, duplicative, and vague entries but increased the fee request by a 1.2 positive multiplier, decisions not challenged on appeal.  The lower court then applied a .40 negative multiplier to the adjusted lodestar of $1,144,659.36 based on plaintiff’s counsel’s incivility through the litigation, attacking defense counsel and belittling the court.  That resulted in an ultimate fee award of $686,795.62.  The appellate court found the reduction to be no abuse of discretion, determining that an “incivility reduction” was completely proper when the record shows (as it did to the reviewing court) that counsel engaged in incivility.  To us bloggers, this stresses an important theme in fee requests—the requesting attorney’s credibility is paramount, difficult to restore when unreasonable fee requests are presented for resolution or litigation counsel went out of bounds in his or her conduct before the lower court.

Costs, Default Judgments, Multipliers, Paralegal Time: $709,620 In Attorney’s Fees Entered As Part Of A Default Judgment After Entry of Terminating Sanctions Was Affirmed On Appeal

Complaint Did Not Have To Plead An Exact Amount Of Fees; 3.0 Positive Multiplier Appropriate; PAGA Settlement Administration Expenses/Paralegal and Legal Assistant Expenses Properly Allowed As Routine Costs.

            Haaverson v. Tavistock Freebirds, LLC, Case No. A164043 (1^st Dist., Div. 5 Aug. 18, 2023) (unpublished) is an interesting opinion which explores whether a complaint needs to plead a specific amount of attorney’s fees to sustain a subsequent default judgment based on a request for substantial fees.  The holding in the decision is “no,” in most situations.

            What happened here is that a lower court granted terminating sanctions against defendant such that a default judgment was eventually entered for $25,000 in PAGA penalties, $48,793.90 in costs, and $709,620 in attorney’s fees inclusive of a 3.0 multiplier.  Defendant’s main argument on appeal was that the complaint’s prayer for “reasonable attorney’s fees and costs” was an insufficient allegation on which to base a default judgment because it was “relief” within the meaning of CCP § 580(a) requiring a more exact numerical specification.  The appellate court concluded attorney’s fees did not constitute the necessary “relief,” especially where a default judgment was based on terminating sanctions—adopting the reasoning in Simke, Chodos, Silberfeld & Anteau, Inc. v. Athans, 195 Cal.App.4^th 1275, 1286-1288 (2011).)  However, it examined other cases and reasoned that the result was likely the same in routine default judgment cases.  The appellate panel stated it this way: “Requiring that a plaintiff include an estimate of attorney fees that may be incurred up to the point of trial in the complaint would not meaningfully assist a defendant in making any informed choice. Unlike damages which are more or less fixed in their amount and do not depend on the manner of default, attorney fees will vary greatly depending on whether a default is taken following a defendant’s failure to answer or, like here, following lengthy discovery, motion practice, and terminating sanctions. Because of the speculative nature of any attorney fee estimate at the outset of litigation, a plaintiff is in no better position than a defendant to make that estimate. Indeed, a defendant is arguably in a better position than the plaintiff to estimate the amount of fees to be incurred by the plaintiff because that amount depends, in large part, on how the defendant chooses to proceed in litigation. Therefore, a complaint’s request for “reasonable attorney fees” provides sufficient notice to a defendant that fees are sought while recognizing the near impossibility for the plaintiff to predict what the actual fees will be.”

            Plaintiff was the prevailing party for fees under PAGA.  With respect to the 3.0 multiplier, the degree of skill and difficulty of the case justified an enhancement.

            PAGA administrative expenses to distribute the penalty to 408 employees correctly were awarded by the lower court as routine costs to plaintiff.   Finally, paralegal and legal assistant expenses were awardable as “reasonably necessary to the conduct of the litigation” under the discretionary costs provision, CCP § 1033.5(c))2). 

            BLOG OBSERVATION—We would indicate that if attorney’s fees are awardable as damages, this case might have turned out differently or would need a different analytical path for adjudication of the issue. 

Civil Rights, Lodestar, Multipliers: 4/3 DCA Affirms Majority Of $4.053 Million Civil Rights Fee Award To Prevailing Plaintiff, Remanding Solely For A Study Of Hourly Rates Submitted By Three Attorneys

Case Has Interesting Discussions of Civil Rights Lodestar, Multipliers, Hourly Rate Review, and Pro Hac Vice Delayed Admission Principles.

            Presiding Justice O’Leary authored Nachtrieb v. County of Orange, Case No. G060294 (4^th Dist., Div. 3 Aug. 11, 2023) (unpublished), which is a must read for civil rights litigators when it comes to supporting and opposing fee applications under a pro-plaintiff civil rights statute (42 U.S.C. § 1988) after a civil rights plaintiff prevailed against Orange County and two individual defendants to the tune of $1,278,800 in damages.

            What happened next was that plaintiff moved to recoup fees of $4.5 million, but plaintiff also requested an enhancement of the award to $9.9 million.  The defense argued in opposition that no more than $2.2 million in fees were justified.  The lower court awarded fees of $4,053,479 (lauding the success and performance of plaintiff’s attorneys although making reductions), prompting an appeal by the defense and a cross-appeal by plaintiff.

            By and large, the fee award was affirmed, although it was remanded to revisit the hourly rates charged by three of the claiming attorneys.

            Lodestar and multiplier principles do apply in § 1988 cases, with most of the appellate issues reviewed in this case under an abuse of discretion standard.  Even though plaintiff was unsuccessful against certain other defendants, this by itself does not require a reduction under § 1988.  Plaintiff competently supported the fee application, such that the burden of rebuttal fell on the defense, which had to explain excessive, redundant, and unreasonable charges—plaintiff did not have to negate these factors.  The remand occurred because, for three attorneys, the lower court awarded higher rates than those advocated by plaintiff’s fee expert under the Laffey Matrix such that this paradox needed to be resolved. 

            Plaintiff’s cross-appeal arguments were rejected.  There was nothing erroneous about the lower court rejecting a multiplier given a conclusion that the lodestar adequately compensated plaintiff’s attorneys for their work effort.  The lower court correctly excluded 489 hours expended by out-of-state attorneys before they were admitted pro hac vice, given that California does not allow for such compensation. (Golba v. Dick’s Sporting Goods, Inc., 218 Cal.App.4^th 1251, 1255 (2015).)  It further found that the Golba rule was not preempted by other federal civil rights principles because it did not obstruct the purposes of section 1988 but merely required attorney permissive admission as a condition to compensation for work. 

            The appellate court did award appellate costs to the defense, but it clarified that it has no bearing on entitlement to further section 1988 attorney’s fees by plaintiff.  

Lodestar, Multipliers, Reasonableness Of Fees: Plaintiff Properly Awarded $30,450 In Attorney’s Fees Rather Than The “Ask” Of $98,770

Fee Request Reduced On Hourly Rate Ask And Work On An Unfiled Summary Judgment Motion, With Plaintiff’s Multiplier Request Being Denied.

            Plaintiff accepted a defense CCP § 998 offer waiving a car purchase deficiency and paying her $2,001, with the lower court allowed to determine an award of attorney’s fees and costs to plaintiff via a motion.  She moved for $98,770 in fees (inclusive of a 1.5 positive multiplier), but the lower court only awarded $30,450.  She appealed in First Technology Federal Credit Union v. Trojan, Case No. H049919 (6^th Dist. Mar. 10, 2023) (unpublished).

            She did not obtain anything better on appeal, especially given that the lack of a reporter’s transcript of the fee hearing hampered review.  The lower court properly reduced the requested hourly rates by Santa Clara attorneys, because those rates were too high for the type of work which would be charged by attorneys in Monterey (the case venue).  There is a nice discussion of the degree of specificity that a fee claimant needs to show for purposes of justifying retention of an out-of-venue attorney charging higher rates, given that the lower court implicitly found plaintiff’s showing on this issue to be deficient.  The trial judge further did not err in reducing the fee request for work expended on a summary judgment motion that was never filed—with the appellate court locating no authority indicating that such unused work had to be compensated.  Finally, even though the case was taken on contingency, this alone does not mandate a positive multiplier, with the lower court’s determination that the case was relatively uncomplicated in nature.

Multipliers: Dicta In Unpublished Case Implies That Fee Agreement With “Incurred” Language Did Not Prevent A Multiplier

Appellate Decision Suggested That San Dieguito Partnership Decision Was Undermined By PLCM Group.

            Because appellant really failed to support challenges to a fee decision, dicta in Counts v. Chadwick, Case No. A163282 (1^st Dist., Div. 1 Nov. 15, 2022) (unpublished) has more importance for practitioners in fee proceedings.  Specifically, appellant claimed that an award of a multiplier was improper because the attorney fee agreement only allowed for recovery of attorney’s fees “incurred.”  Although indicating that appellant did not correctly cite San Dieguito Partnership v. San Dieguito River Valley Regional Etc. Authority, 61 Cal.App.4^th 910, 919 (1998) to support the proposition, the Counts appellate court observed that if this was the ruling in San Dieguito, it was later undermined by the holding in PLCM Group, Inc. v. Drexler, 22 Cal.4^th 1084, 1097, fn. 5 (2000), which held that unless there was an express language capping the amount to be awarded or indicating no multiplier could be awarded, nothing prevented a multiplier award—as was done in the decision.

Civil Rights, Multipliers, Reasonableness Of Fees: Ninth Circuit Confirms Significant Haircut To Serial ADA Plaintiff’s Attorney’s Fees And Costs Award

No Abuse Of Discretion In District’s Reduction Of Fees And Costs Award To $9,851 From The Requested $34,899 Where Work Was Routine And Boilerplate, There Was A Lack Of Opposition, And Much Of The Motion Practice Was Unnecessary.

            In Shayler v. 1310 PCH, LLC, Case No. 21-56130 (9^th Cir. October 24, 2022) (published), serial Americans with Disabilities Act plaintiff sued defendant  for failure to comply with regulatory requirements for accessible parking spaces.  Eight months later, plaintiff moved for summary judgment, to which defendant filed a notice of non-opposition.  Plaintiff nonetheless filed a reply brief, and – after being granted summary judgment – moved for $31,714 in attorneys’ fees and $3,185 in costs.

            Explaining that it found the hourly rates and time spent by plaintiff’s attorneys unreasonable – where two partner-level attorneys performed tasks that could have been performed by low level associates or paralegals, given the straightforward boilerplate filings in the case that did not involve complex legal issues or difficult factual discovery, and spent 17 hours on an unopposed motion for summary judgment, including 7 hours on the reply brief, the district court adopted a blended hourly rate of $300 used in similar cases and applied a 65% downward multiplier – resulting in a fees award of $7,896.  Additionally, the district court awarded reduced costs of $1,955 after taxing plaintiff’s request for reimbursement for a site inspector for which plaintiff provided no invoice and no reasonable explanation as to the inspector’s importance to the case.

            On appeal, plaintiff argued that the district court failed to provide an adequate explanation for the blended billing rate and downward multiplier.  Although the Ninth Circuit found the argument reasonable given case law on this issue (Chaudhry v. City of Los Angeles, 751 F.3d 1096, 1111 (9^th Cir. 2014) [fee award vacated for district court’s failure to explain its use of a blended billing rate]; Van Gerwen v. Guarantee Mut. Life Co., 214 F.3d 1041, 1045 (9th Cir. 2000) [upward and downward multipliers must be justified]), it found that the district court provided a “concise but clear explanation” of the grounds for its decision – with a “concise but clear” explanation requiring only enough reasoning to enable meaningful appellate review. (Hensley v. Eckerhart, 461 U.S. 424, 437 (1983); Jankey v. Poop Deck, 537 F.3d 1122, 1133 (9th Cir. 2008) [discussed in our August 13, 2008 post]; Gates v. Deukmejian, 987 F.2d 1392, 1398 (9th Cir. 1992).)  Concluding that the district court’s explanations for the blended billing rate and downward multiplier sufficiently supported its reduced fee award, the Ninth Circuit found no abuse of discretion and affirmed.

Employment, Multipliers, Reasonableness of Fees: No Abuse Of Discretion In Trial Court’s Award Of Attorney Fees To Prevailing Plaintiffs In DJOA Action

Amount Of Fee Award Was Justified Given Trial Court’s Analysis Of The Complexity Of The Case, Results Achieved By Plaintiffs, And Plaintiffs’ Showing To Support The Fee Request.

            The Displaced Janitors Opportunity Act (Lab. Code, §§ 1060–1065) “requires contractors who are awarded contracts for janitorial or building maintenance services at a particular site to retain certain employees working for the terminated contractor for a 60-day transition employment period, and to offer those workers continued employment if their performance during the 60-day period is satisfactory.” (§ 1061, subds. (b)(1) & (f).) Under the DJOA, an employee of the terminated contractor who was not offered employment by the successor contractor may sue the successor for back pay, including the value of any lost employment benefits. (§ 1062, subd. (a).) An employee prevailing in such an action “shall” be awarded “reasonable attorney’s fees and costs as part of the costs recoverable.” (§ 1062, subd. (c).) (Jones v. Quality Coast, Inc. (2021), 62 Cal.App.5th 372, 379–380 (2021) [discussed in our February 27, 2021 post].) The Displaced Worker Protection Act (S.F. Police Code, §§ 3300C.1–3300C.6) provides for a similar 90-day transition period. (§§ 3300C.1(c) & (f), 3300C.2(b).)

            In SEIU-USWW v. Preferred Building Services, Inc., Case No. A159790 (1^st Dist., Div. 5 October 15, 2021) (partially published – fees discussion not published), a successor janitorial contractor appealed after a class of displaced janitors and their union – suing for violations of the DJOA and DWPA – successfully moved for summary judgment and were subsequently awarded attorneys’ fees.

            On appeal, Defendant challenged the amount of fees awarded – arguing the trial court should have adjusted the lodestar downward due to overstaffing with eight attorneys, double counted the attorneys’ skill by applying a multiplier when the skill level was already factored into the lodestar, and that the 1.4 multiplier (reduced from Plaintiffs’ requested 2.0) was not supported by the factors involved in the case.  The 1/5 DCA affirmed.  The trial court properly considered and analyzed the complexity of the case, results achieved by Plaintiffs, and Plaintiffs’ showing to support the fee request.  Ninety percent of Plaintiffs’ billed hours came from lead counsel and four associates, time for attorneys billing less than 10 hours was excluded, and Plaintiffs had applied an across-the-board lodestar reduction of ten percent.  As to its other contentions, Defendant did not demonstrate that the trial court improperly double counted counsel’s skill nor abused its discretion in applying the multiplier. The trial court identified four factors warranting the multiplier – where “any one of those factors may be responsible for enhancing or reducing the lodestar.” (Krumme v. Mercury Ins. Co., 123 Cal.App.4th 924, 947 (2004).)

Consumer Statutes, Multiplier, Reasonableness Of Fees: Trial Court Did Not Abuse Its Discretion In Awarding $20,000 Fee Award Out Of Requested $40,113.75 Base Lodestar

The Problem Was That The Case Was Routine Such That Hours Billed For “Cut And Paste” Activities Were Excessive, With A 25% Positive Multiplier Properly Denied.

            In Fishback v. FCA US, LLC, Case No. B298677 (2d Dist., Div. 3 May 14, 2021) (unpublished), a lemon law plaintiff was awarded a lesser sum of attorney’s fees of $20,000 out of a requested $52,834,30 ($40,113.75 lodestar plus a 25% positive enhancement).  Plaintiff was not satisfied with this fee awarding, triggering an appeal.  When it comes to the amount of fees, plaintiff could not surmount the deferential abuse of discretion standard.  The lower court found that this was a routine case, the discovery was “cookie-cutter” and “cut and paste,” there was no law and motion proceedings except for the fee motion, there was limited discovery, and a settlement was reached early in the case.  None of these conclusions were disturbed on appeal.  However, we will give an example of fees found to be excessive—counsel traveling by car from Rancho Palos Verdes to Burlingame and back to defend a deposition, given a flight from LAX to SFO takes about one hour—did not justify counsel’s billing for 16.1 hours of automobile travel, as the trial judge could determine as not being reasonable in nature. 

            Also, the 25% positive enhancement correctly rejected due to the lower court’s conclusion that this was a garden-variety lemon law case. 

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.

Multipliers, Private Attorney General, Special Fee Shifting Statutes: The 1/5 DCA Affirms $2,961,264.29 Fees And Costs Award, Inclusive Of A 1.4 Multiplier, To Prevailing Plaintiff In Action For Violations Of A Conservation Easement

Plaintiff’s Attorneys, Who Bore The Risk Of Taking On A Partially Contingent Case With Important Public Interests At Stake, Displayed Exceptional Expertise and Skill In A Case Involving Nearly Five Years Of Contentious Litigation And A 19-Day Trial.

            Following a 19-day bench trial in The Sonoma Land Trust v. Thompson, Case No. A159139 (1^st Dist., Div. 5 April 30, 2021) (published), defendant property owners and their non-party corporation were found jointly and severally liable for violations of a conservation easement – with plaintiff nonprofit easement holder being awarded $575,899 in monetary damages, which included $318,870 for the costs of restoring the property, and injunctive relief (results affirmed in a previous appeal).  Additionally, the trial court awarded plaintiff with attorney fees and costs of $2,961,264.29, inclusive of a 1.4 multiplier, under Civ. Code § 815.7(d), Code Civ. Proc. § 1021.5, and the conservation easement itself.  

            Defendants appealed, but the 1/5 DCA affirmed.

            Contrary to defendants’ contention, the trial court was not required to deduct the initial $500,000 in fees paid by plaintiff’s insurance policy as trial courts may award fees regardless of who paid the fees, and plaintiff did not receive a double recovery as, pursuant to its insurance policy, it had to reimburse its insurer from any damage award.  Additionally, pursuant to the easement, plaintiff was entitled to its fees as the prevailing party – whether or not it actually paid the fees.

            The panel also was not persuaded by defendants’ vague arguments that plaintiff’s attorneys were inefficient and over-litigated an easy case – especially given that the litigation was contentious, dragged on for nearly five years, involved a 19-day trial, and plaintiff’s counsel had reduced its request by more than 10 percent to account for duplications and inefficiencies. 

            As to the multiplier, there was no abuse of discretion.  The contingent risk plaintiff’s attorneys faced was not eliminated by the initial insurance payment – it was merely mitigated.  The trial court reduced plaintiff’s requested multiplier from 1.6 to 1.4 after properly considering that plaintiff’s attorneys received some fees upfront, then proceeded on a “fully contingent basis . . . due to the important public interests at stake.” 

            Finally, defendants argued that the trial court improperly used the skill level of plaintiff’s attorneys and the novelty and difficulty of the case to justify the lodestar and the multiplier – resulting in double counting.  Not so, said the panel.  Based on the exceptionally high levels of skill and expertise displayed by plaintiff’s counsel – that was not fully factored in to the lodestar – the trial court could have reasonably set a higher hourly lodestar rate.  However, the lower lodestar allowed the trial court more room for a multiplier to provide fair compensation for plaintiff’s attorneys – with the panel noting that the contingent risk factor alone justified the multiplier.

Allocation, Employment, Mulitpliers, Private Attorney General: 1/1 DCA Reverses $2,905,200 In PAGA Penalties Against Defendant, But Affirms $7,793,030 In Attorney Fees Inclusive Of A 2.0 Multiplier

The Fees Award Was Supported By PAGA, Section 1021.5, And The Catalyst Theory, And Apportionment Of Fees Among The Retaliation And PAGA Claims Was Neither Necessary Nor Possible, While Complexity Of Issues And Skill Of Attorneys Supported Multiplier In This Intensely Litigated Case.

            In Sargeant v. Board of Trustees of The California State University, Case Nos. A153072/A154926 (1^st Dist., Div. 1 March 5, 2021) (published) (fees discussion unpublished), a health-and-safety technician employed at Sonoma State University sued Cal State University and his supervisor alleging five retaliation causes of action for the way he was treated after raising environmental concerns related to lead paint and asbestos.  Specifically, plaintiff's causes of action fell under the Whistleblower Protection Act (Lab. Code §§ 1102.5, 6310, 6399.7, 232.5), the California Fair Employment and Housing Act (FEHA, Gov. Code, § 12900 et seq.), and one cause of action for civil penalties under the Labor Code Private Attorneys General Act of 2004 (Labor Code, § 2698 et seq.,) (“PAGA”) premised on allegations that CSU had violated various provisions of Cal-OSHA.

            The jury returned special verdicts against defendants – finding in plaintiff’s favor on three retaliation claims and on the PAGA claim, and awarding plaintiff $271,895 in past and future economic damages, plus $116,000 in noneconomic damages.  Because plaintiff elected the equitable remedy of reinstatement in lieu of the past and future economic damages, only the noneconomic damages were included in the judgment.  Additionally, the trial court ordered CSU to pay civil penalties of $2,905,200 for its various violations.

            Plaintiff then moved for more than $11.5 million in fees which included a 3.0 multiplier for three of the five attorneys representing him.  The trial court awarded $7,793,030 in fees – finding that three legal bases supported the award: (1) PAGA itself, which authorizes a fee award to a prevailing employee (§ 2699, subd. (g)(1)), (2) Code of Civil Procedure section 1021.5, which authorizes a fees award when an action results in the enforcement of an important right affecting the public interest; and (3) the “catalyst doctrine.”  Additionally, the trial court found that it was neither necessary nor possible to apportion the fees among the retaliation and PAGA causes of action.  Finally, the trial court concluded that a multiplier was appropriate given the complexity of the case, the skill of plaintiff’s attorneys, the extent to which the litigation precluded other employment, the contingent nature of the fee award, and the fact an award against the state would ultimately fall on the taxpayers, but reduced plaintiff’s requested 3.0 multiplier to 2.0.

            Defendants raised a number of challenges on appeal, but in the published portion of its decision, the appellate panel affirmed – with exception to the PAGA penalties.  The panel reversed the entire $2,905,200 in PAGA penalties – finding that although plaintiff brought viable PAGA claims, some of the PAGA claims did not themselves provide for penalties, and plaintiff did not suffer personally on those claims premised on the Cal-OSHA violations.

            In the unpublished portion of its opinion, the 1/1 DCA affirmed the attorney fees award – agreeing with the trial court’s conclusions and reasoning, and finding no abuse of discretion.

Allocation, Consumer Statutes, Multipliers, Preemption: Prevailing Lemon Law Plaintiff Winning Only $21,957.25 In Damages At Jury Trial Properly Awarded $169,602 In Attorney Fees, Inclusive Of .2 Multiplier, Against Dealership And Finance Company

Apportionment Was Not Necessary Due To Intertwined Claims, Multiplier Was Appropriate Given Plaintiff’s Counsel’s Contingency Risk, And – Contrary To Lafferty And Spikener – 2/5 DCA Determined That The Holder Rule Does Not Limit The Attorney Fees A Plaintiff May Recover From A Creditor-Assignee.

            For a great discussion on the Holder Rule cap and its applicability to attorney fees, we commend Pulliam v. HNL Automotive Inc. et al., Case No. B293435 (2d Dist., Div. 5 January 29, 2021) (published) to our readers.

            In Pulliam, a Song-Beverly Act (California’s lemon law) plaintiff was awarded $169,602 in attorney fees, consisting of a $141,335 lodestar plus a .2 multiplier, after prevailing at jury trial and being awarded $21,957.25 in damages against dealership and the finance company that accepted assignment of the retail installment sales contract for her purchase of a “Certified Pre-Owned” 2015 Nissan Altima. 

            Defendants appealed – arguing: (1) plaintiff’s counsel failed to provide evidence of their hourly rates, (2) the trial court erred in refusing to apportion attorney’s fees between plaintiff’s successful and unsuccessful causes of action, (3) the trial court erred in applying a lodestar multiplier because the lawsuit was not exceptionally difficult and plaintiff’s counsel was not exceptionally skilled, and (4) finance company was not liable for attorney’s fees under title 16, section 433.2 of the Code of Federal Regulations (2020) (the Holder Rule) because its liability could not exceed the amount plaintiff paid to it. 

            The 2/5 DCA, in a 3-0 opinion authored by Justice Rubin, affirmed – finding no abuse of discretion, and concluding the Holder Rule does not limit the attorney fees a plaintiff may recover from a creditor-assignee.  First, plaintiff’s counsel attached a declaration – which included a copy of the firm’s invoice identifying the timekeepers, the work performed, and the timekeepers’ hourly rates – to plaintiff’s fee motion.  Additionally, plaintiff’s counsel’s declaration described the firm’s rates and the qualifications of each timekeeper, along with a national survey of prevailing rates among consumer protection attorneys – including California attorneys.  Second, the record supported the trial court’s view that apportionment of the fees was not possible because the successful and unsuccessful claims involved a common core of facts and intertwined theories.  Third, the panel found the multiplier was modest and accounted for the risk plaintiff’s counsel took in litigating the case against defendants whom the court found made the case challenging and protracted.

            Finally, as to the Holder Rule – promulgated by the Federal Trade Commission in 1975 as a consumer protection measure to abrogate the holder in due course rule for consumer installment sales contracts funded by a commercial lender – the panel found its cap does not apply to attorney fees.  The final sentence of the Holder Rule states that recovery by the debtor shall not exceed the amounts paid by the debtor under the installment sales contract. Finance company asserted that this cap limited plaintiff’s recovery of both damages and attorney fees from it to the amount she paid under the installment contract – relying on Lafferty v. Wells Fargo Bank, N.A., 25 Cal.App.5th 398 (2018) [discussed in our July 20, 2018 post] and Spikener v. Ally Financial, Inc., 50 Cal.App.5th 151 (2020) [discussed in our June 11, 2020 post].  However, as the panel pointed out, many opinions on this issue have been contradictory, and it concluded that to include attorney’s fees in the Holder Rule’s limitation on recovery would be out of sync with its objective of reallocating the costs of the seller’s misconduct from the consumer back to the seller and creditor.  Additionally, the California Legislature had taken a similar view in enacting Civil Code § 1459.5 – intending to repeal Lafferty and allow recovery of fees in excess of the Holder Rule’s cap.  As to financial company’s argument that, as held in Spikener, the FTC’s Rule Confirmation (holding fees are included in the cap) is entitled to deference and preempts § 1459.5, the panel disagreed – finding the FTC’s Confirmation did not meet the four-marker test set forth in Kisor v. Wilkie, 139 S. Ct. 2400 (2019) for determining when regulatory deference is appropriate.  “[I]n considering deference, ‘a court must make an independent inquiry into whether the character and context of the agency interpretation entitles it to controlling weight. [Citations.]’” (Id. at p. 2416.)

Lodestar, Multiplier, Reasonableness Of Fees: Prevailing FEHA Plaintiff Only Recovering $400,800 In Fees Out Of Requested $1,064,062.70 Did Not Recover Any More On Appeal

Compensatory Award Was $575,000.

            Plaintiff did prevail on some wrongful termination/FEHA claims to the tune of $575,000 in past noneconomic damages.  Plaintiff later moved to recoup $1,064,062.70 in fees (lodestar of $532,031.35 plus a 2.0 positive multiplier), with the trial judge awarding $400,800.  Both sides appealed, with plaintiff filing a cross-appeal seeking more fees.  Both sides lost in Lave v. Charter Communications, LLC, Case No. D076206 (4^th Dist., Div. 1 Dec. 21, 2020, posted on Dec. 22, 2020) (unpublished).

            The problem was that plaintiff waived any fees challenges by not raising them below—with forfeiture being a key appellate principle often applied if an appellant did not contest it before the trial judge.  With respect to not awarding the 2.0 multiplier, plaintiff could not demonstrate how the lower court abused its discretion, given that a multiplier is not automatic and a discretionary call unless legal criteria are not properly followed in coming to a decision.  That was the case in this particular matter.

Employment, Multipliers, Costs: Employee Obtaining Partial Success In FEHA Case Properly Awarded $695,000 In Attorney’s Fees, No Expert Witness Fees, And Some Routine Costs

Plaintiff’s $2 Million Request, Inclusive Of A 2.0 Positive Multiplier, Did Not Gain Traction.

            Partial success and high hourly rates can often lead to reductions and rejection of a multiplier in contingency-driven cases under FEHA.  That is what basically occurred in Do v. Raytheon Co., Case No. B293950 (2d Dist., Div. 4 Oct 27, 2020) (unpublished).

            A FEHA plaintiff obtained a total $1.75 million compensatory/punitive damages award against his employer, prevailing on two out of eight claims.  Plaintiff then moved to recover close to $2 million in attorney’s fees under a FEHA shifting statute, $55,322.29 in expert witness fees, and other routine costs.  At the end of the day, the lower court awarded $695,000 in attorney’s fees, no expert witnesses fees, and some routine costs (taxing some messenger, mock trial, and jury consultant expenses).

            All of these determinations were affirmed on appeal.  No multiplier was justified, despite this being a contingency matter, because high hourly rates were being requested and plaintiff did not prevail on a significant number of claims.  Decreasing the fee claim for partial success was totally acceptable under California law, with the reduction off of the lodestar amount (around 20%) being okay.  Expert witness fees were properly denied because the experts did not testify at trial, such that they were not presumptively necessary or reasonable.  Finally, CCP § 1033.5 reasonableness requirements do govern FEHA costs requests, with the lower court’s discount of certain routine requests—messenger, mock trial, and jury consultant expenses—not being an abuse of discretion. 

Allocation, Consumer Statutes, Lodestar, Multipliers: Santana Decision Now Published

Apportionment Between Song-Beverly Act Fees/Costs And Other Causes Of Action, Where Fees Are Not Permitted, Not Necessary Where Claims Are Inextricably Intertwined.  

            In our September 29, 2020 post, we discussed Santana v. FCA US, LLC, Case Nos. G057244/G058020 (4^th Dist., Div. 3), which was unpublished at the time.

            In Santana, the trial court awarded Song-Beverly Act fees/costs of $510,637.87, including a 2.0 multiplier, after a jury found defendant liable for breach of the express and implied warranty, and fraudulent concealment for plaintiff’s claims arising from the defective vehicle he purchased.

            On appeal, the 4/3 DCA vacated a significant portion of damages awarded to plaintiff when it reversed on the fraudulent concealment claim.  However, the appellate panel affirmed the entirety of the fees/costs awarded by the trial court – finding no abuse of discretion because apportionment between the Song-Beverly claims and non-fee claims was not needed given that plaintiff’s causes of action stemmed from an issue common to all of his claims.  As such, plaintiff’s claims were inextricably intertwined such that apportionment would be impracticable, if not impossible.

            Santana was certified for publication on October 23, 2020.

Allocation, Consumer Statutes, Lodestar, Multiplier: Although Fraudulent Concealment Compensatory And Punitive Damages Were Reversed, $510,637.87 Fee/Costs Award Under Song-Beverly Act Case Affirmed On Appeal

Failure To Apportion/Double Counting Lodestar And Enhancement Arguments Not Supported By The Record.

            In many cases, a fees-seeking litigant needs to apportion between fee entitlement and non-fee entitlement claims, unless the thrust of the case involved a fee entitlement case so that it was inextricably intertwined with a non-fee case.  If so, even a reversal of the non-fee case upholds the fee award on the intertwined fee entitlement basis of the case.

            That is what occurred in Santana v. FCA US, LLC, Case Nos. G057244/G058020 (4^th Dist., Div. 3 Sept. 29, 2020) (unpublished).

            In a defective vehicle case for Song-Beverly Act violations and fraudulent concealment, plaintiff was awarded $1,229,531.71 (of which $1 million was punitive damages under the fraud count) and then awarded Song-Beverly Act fees/costs of $510,637.87 inclusive of a positive 2.0 multiplier, but less than 2.5 multiplier requested by plaintiff. 

            The 4/3 DCA affirmed the fees/costs award in a 3-0 panel decision authored by Justice Ikola, although there was a large scale-back of the fraud damages, paring about $1.134 million from the overall award.

            The defense argued that there needed to be an apportionment, but that did not resonate based on the fraudulent concealment being intertwined and with the defense not offering a realistic apportionment proposal for the trial or appellate courts to consider.

            With respect to the “double dip” argument, the appellate court indicated that a plaintiff could not rely on a contingency risk argument if it was being used to justify the lodestar and an enhancement.  However, that did not occur here because the trial judge did not use the contingency risk to justify the hourly lodestar rate but only used it for true enhancement, also mentioning complexity and attorney skill which would have gotten to the same result.

UPDATE: Santana was certified for publication on October 23, 2020.

Civil Rights, Multipliers: Lower Court Properly Denied Prevailing FEHA Plaintiff’s Request For A 2.0 Positive Multiplier

Grant Of Full Lodestar Request Was The Main Reason For Refusing Multiplier, A Determination Affirmed On Appeal.

            A plaintiff prevailed on FEHA claims against defendant in Scudder v. Dept. of Transportation, Case No. B293859 (2d Dist., Div. 5 July 14, 2020) (unpublished).  Plaintiff then moved for attorney’s fees in a lodestar amount of $592,075 augmented by a positive 2.0 multiplier because the case was taken on a contingency basis and it supposedly took a large portion of the small prosecuting firm’s time.  The trial judge awarded the full lodestar request, but he denied the multiplier request.  He did so because the case was not exceptionally complex (involving one plaintiff), no exceptional skill was displayed in prosecuting the matter, no specific facts were shown to demonstrate preclusion from other employment, and the lodestar grant fully compensated plaintiff’s attorneys for the time they expended.

            The 2/5 DCA affirmed.

            First of all, the appellate court found there was an inadequate record because no reporter’s transcript or agreed/settled statement on the hearing was presented for review such that there was no presumption the trial judge failed to consider the proper factors in coming to a multiplier denial decision.  (We have posted on this point many times before; where failure to consider factors or discretion is involved, it is imperative to have some type of record on what happened at a fee hearing.)  However, even on the merits, the trial judge was not required to grant a multiplier—with the available record vindicating his reasoning (especially given that the full lodestar award compensated attorneys for their work effort). 

Consumer Statutes, Multipliers, Reasonableness Of Fees: Mikhaeilpoor Opinion Now Published

Prevailing Plaintiff’s Request For Fees In A Straightforward Lemon Law Case Was Properly And Significantly Reduced For Overstaffing, Lack Of Efficiency, Excessive Hourly Rates, And Denial Of Lodestar Multiplier.

            We discussed the then unpublished case of Mikhaeilpoor v. BMW of North America, LLC, Case No. B293987 (2d Dist., Div. 1 April 1, 2020) in our April 2, 2020 post, and can now report that it was published on April 24, 2020.

            Plaintiff won a $35,805.80 jury verdict in an “uncomplicated” lemon law vehicle case, then moved for $344,639 in fees – including a .5 lodestar multiplier – which the trial court reduced to $94,864 after denial of the requested multiplier and reductions for overstaffing, excessive hourly rates, and other inefficiencies.  Plaintiff appealed, but the 2/1 DCA affirmed -- finding no abuse of discretion under the circumstances of the case.

Consumer Statutes, Multiplier, Reasonableness Of Fees: Trial Judge In “Uncomplicated” Lemon Law Case Properly Awarded $94,864 In Song-Beverly Act Attorney’s Fees To Prevailing Plaintiff Winning A Jury Verdict Of $35,805.08

Plaintiff Had Sought $344,639 In Fees, Which Lower Court Found To Be Unreasonable Based On Overstaffing, Lack Of Efficiency, And Requesting Hourly Rates Too High For The Complexity Of The Case; Multiplier Request Properly Denied.

            We commend everyone to read the appellate court’s affirmance of a trial court’s reduction of an attorney’s fees request in Mikhaeilpoor v. BMW of North America, LLC, Case No. B293987 (2d Dist., Div. 1 Apr. 1, 2020) (unpublished), authored by Los Angeles County Superior Court Judge Elizabeth A. White who is sitting by assignment on the 2/1 DCA.  It has a superb summary of these topics:  lodestar; trial court discretion to reduce fees; multipliers; and Song-Beverly Act (lemon) law nuances relating to fee awards.

            In this matter, plaintiff won a jury verdict of $35,805.80 in a straightforward lemon law vehicle case.  The problem occurred when plaintiff’s attorneys sought $344,639 in fees (the lodestar plus a .5 multiplier plus some other minor expense requests).  The trial judge was aghast because the fee submissions showed that 10 attorneys worked the case; hourly rates ranging from $325 - $495 per hour were requested; many motions were “much ado about nothing”; and the case was straightforward/noncomplex in nature.  The defense objected to the hourly rates and argued that at least $83,206.05 should be slashed from the fee request based on block billing and inefficiencies.  After a detailed explanation of his reasoning for reducing the requested fees, the trial judge awarded $94,864 after a small offset for certain fees/costs owed to the defense, in the process denying the multiplier request. That prompted an appeal by plaintiff.

            The 2/1 DCA panel affirmed because it did not see an abuse of discretion under the circumstances.

            Again, we will not summarize all aspects of this unpublished decision, but it is a virtual lexicon for practitioners and others to use as far as lodestar, multiplier, and lemon law fee issues are concerned.

            First of all, the trial judge made detailed explanations at the fee hearing.  Plaintiff relied on federal cases requiring more detail when reducing fee awards, but these were inapt for California state court proceedings.  (In fact, no statements of decision are required in fees matters, although we bloggers observe that trial judges are becoming much more detailed in their tentative or final decisions in this area.)

            Second, the record belied that the lower court made an “across-the-board” percentage reduction without an adequate explanation—which distinguished other California cases (lemon law and in other areas) to the contrary.

            Third, the trial judge also did not make an impermissible fee award based on the jury award to plaintiff, given that proportionality per se is not the rule of law in lemon law cases.  He acknowledged that large fee awards are oft times justified in lemon law cases, but reduced for excessive hourly rates, overstaffing, and other inefficiencies. 

            Fourth, plaintiff argued that the defense had only asked for a smaller reduction such that the trial judge was restrained from making a larger reduction.  This contention was dismissed because the defense carefully asked for a reduction “of at least” a specified amount, not to mention the lower court has discretion to go beyond a defense reduction request.

            Last, but not least, the denial of a multiplier was no abuse of discretion given that the case was not complex (the novelty/difficulty factor to be assessed when positive enhancements are requested).

Employment, Multipliers, Substantiation Of Reasonableness Of Fees: FEHA Plaintiff Properly Awarded Fees At Reduced Hourly Rates, But Augmented By Hourly Rates For Enhancement Factors, And Then Correctly Denied Any Multiplier Beyond That

Almost $1.5 Million In Fees/Costs Sought, But Ultimate Affirmed Award Was About $649,000.

            The next case is an interesting example of how a trial judge’s decision to not credit prior fee awards to an employment contingency attorney was affirmed because there was not sufficient foundation to show the prior awards were similar to the case under scrutiny, but provided a positive enhancement to hourly rates to make up for the contingency risk factor.

            In Navarro v. 4Earth Farms, Inc., Case No. B288105 (2d Dist., Div. 5 Sept. 4, 2019) (unpublished), a FEHA plaintiff won a jury verdict of $309,310 against certain defendants.  Filling emboldened, plaintiff’s counsel then moved for attorney’s fees of $1,473,315, inclusive of a 2.0 positive multiplier, against the non-prevailing defendants, with hourly rates requested which ranged from $450-850 per hour.  Plaintiff’s counsel supported these rates with a list of 10 recent fee awards the firm had received from other courts.  The trial judge found the rates to be too high in a tentative decision, but he wanted to give further thought to the multiplier request.  Later, the lower court awarded lower hourly rates to plaintiff’s lawyers, but it enhanced them somewhat for “multiplier” factors after observing the case was not complex and was a single plaintiff case (mainly, for contingency risk).  Ultimately, it awarded $649,020.62 in fees and costs to plaintiff.

            The 2/5 DCA affirmed.

            Although acknowledging that prior fee awards could be relevant (Margolin v. Regional Planning Com., 134 Cal.App.3d 999, 1005-1006 (1982)), the appellate court affirmed the trial court’s conclusion that plaintiff’s counsel did not give an “apples to apples” comparison—the listed cases were class actions unlike the involved single plaintiff case with not as much complexity, such that the similarity nexus was missing.  Also, even though most trial judges simply award a multiplier after reductions, the trial judge here did not discount any hourly work effort tasks at all but simply applied a higher hourly rate as an enhancement—something perfectly proper under California law.  (Horsford v. Board of Trustees of California State University, 132 Cal.App.4^th 359, 394-395 (2005).)  So, the fact that he did not apply a multiplier, but enhanced the hourly rates beyond what he considered reasonable, was no abuse of discretion.  

Class Action, Multipliers: Eleventh Circuit Court Of Appeals Affirms Most Of Class Counsel Award In Home Depot Data Breach Case, But Reverses 1.3 Positive Multiplier Enhancement

Federal Appellate Court Provides Scholarly Analysis Of Differences Between Common Fund, Constructive Common Fund, And Contractual Fee-Shifting Cases.

            In In re:  Home Depot Inc. Customer Data Security Litig., No. 17-14741 (11^th Cir. July 25, 2019) (published), the Eleventh Circuit faced review of a $15.3 million fee award to class counsel in a class action stemming from Home Depot’s 2014 data security breach which exposed the credit card information to improper use for tens of millions of customers.  It eventually agreed to settle by paying $25 million into a settlement fund, paying smaller banks an additional $2.25 million (after paying about $134.5 million--$120 million set by the banks under contractual agreements with Home Depot and a $14.5 million premium to other banks on top of that--under a card-brand recovery process), and agreeing to data breach security measures of an on-going nature.  The settlement agreement also confirmed class counsel was entitled to reasonable attorney’s fees, but it set no amount for fees in the agreement and allowed this determination to be made by the district judge.  The fees would be paid by Home Depot separate from the other settlement payments.  The district judge awarded class counsel $15.3 million in fees, calculated this way:  (1) a lodestar of $11.7 million enhanced by a positive 1.3 multiplier based on risk; and (2) cross-checked by the percentage method, based on an addition of the $27.25 million settlement payments, the $14.5 bank premium, and about $700,000 in expenses (about a $42.5 million total “percentage”), with the award being slightly higher than a third of the “percentage” (which was close to the 20-30% generally allowed in the Eleventh Circuit).  Class counsel had asked for $18 million, while Home Depot suggested only $5.6 million should be the fee award.

            The Eleventh Circuit affirmed most of the fee award, although reversing the grant of the 1.3 positive enhancement.

            The key threshold determination was to decide whether the case was a constructive common fund or contractual fee-shifting case, with the latter being the characterization adopted by the federal appeals court.  The reason for this was that the settlement agreement had a fees clause, no fees were specified or capped as under clear sailing provisions, and the fee determination was left to the district court’s decision-making authority.  This smacked of a contract fee-shifting situation, unlike a common fund where fees are actually taken out of the class recovery such that they are paid by the “client” (the class). 

            The multiplier was infirm because federal precedents (such as Perdue and Dague) are hostile to enhancements, because it is assumed that the lodestar factors subsume the multiplier considerations for further enhancement.  Given that risk is not a factor to consider for enhancement in statutory fee-shifting cases, the appeals court found no reason that the same logic should not apply to contract fee-shifting cases. 

            The Eleventh Circuit also found that compensating class counsel for the card-brand recovery work and time spent in vetting class representatives was appropriate.  Clearly, the class litigation was a catalyst which drove Home Depot to pay the banks and narrow the class exposure in the overall sense. 

            The district judge’s decision did provide sufficient detail, especially given that Home Depot failed to make specific objections.

            The class cross-appealed.  It argued that it was error for the district judge to not include the attorney’s fees in the “percentage” cross-check total.  The appeals court disagreed, concluding that it would be impractical to guess what fees might have been awarded in a contract fee-shifting context.  It also found some balance here:  fees on fees are not awardable in common fund cases, but they are awardable in contract fee-shifting cases. 

            BLOG COMMENT—Same result in California state courts?  Likely no.  Although novelty, complexity, and counsel special skill lodestar factors cannot be counted twice for multiplier analysis, risk is a factor which can be considered separately.  (Ramos v. Countrywide Home Loans, 82 Cal.App.4^th 615, 625 (2000).)  Beyond that, California does not take the dim view that Perdue/federal precedents do on enhancements in statutory fee-shifting cases.  (Khazan v. Braynin (Khazan III), Case No. A128536 (1^st Dist., Div. 4 June 12, 2012), rev. den. [reviewed in our September 15, 2012 post].) 

Allocation, Civil Rights, Multiplier: Cohabiting Unmarried Couple Tenants Winning $11,970 On FEHA Marital Discrimination Claim, Despite Losing Privacy Invasion And Quiet Enjoyment Claims, Properly Awarded $389,200 In Attorney’s Fees

Fees Properly Included A 1.3 Multiplier, With No Allocation Required Because Proof On FEHA And Other Claims Were Intertwined.

            Plaintiff tenants, a cohabiting unmarried couple, sued a San Francisco defendant apartment owner for FEHA marital discrimination, invasion of privacy, and breach of the quiet enjoyment covenant based on owner’s actions in attempting to evict tenants without investigating their declaration of domestic partnership and refusing to accept some repair requests by one of the unmarried partners not technically named in the lease.  Tenants won their FEHA claims and were awarded $11,970 in damages.  However, they lost their privacy and quiet enjoyment claims.  The lower court then awarded them FEHA fees of $389,200 (inclusive of a 1.3 multiplier) and expert witness fees/costs of $8,227.50.

            Owner appealed in Ribotto v. Graystone Partners, LP, Case No. A147713 (1^st Dist., Div. 3 July 29, 2019) (unpublished).  The fee award was not disturbed on appeal.

            The lower court did not err by failing to apportion between the FEHA and unsuccessful claims because the proof all related to the basic case story by plaintiffs that they were unlawfully attempting to evict the tenants.  Given the discretionary nature of this call based on the trial evidence, no abuse of discretion occurred given the lower court was in a better position to make this “judgment call.”  Because tenants did prove their FEHA marital discrimination claim, use of a 1.3 multiplier was no abuse of discretion either.

            BLOG OBSERVATION—This opinion was authored by Retired Justice Rebecca Wiseman, who used to sit on the Fifth District Court of Appeal.  She retired to the Bay Area and has been appointed by assignment to sit on some appellate cases argued before the First District. 

Consumer Statutes, Multipliers: $327,782.75 Lemon Law Fee Award, Inclusive Of A 1.5 Positive Multiplier, Affirmed On Appeal Where $109,357.05 Was Compensatory Award

Plaintiff’s Counsel Showed Why Defense Maneuvers And Jury Verdict Made The Case Beyond A Typical Lemon Law Case.

            We have said this frequently in the past on prior blogs, but for clients and practitioners defending Song-Beverly Consumer Warranty Act “lemon law” cases, you need to be attuned to fee exposure, including positive multipliers, when engaging in battle with an auto purchaser plaintiff.

            Fuller v. FCA US LLC, Case No. B286224 (2d Dist., Div. 4 July 2, 2019) (unpublished) involved a situation where an auto purchaser plaintiff in a “lemon law” case obtained a jury award of $109,357.05,  She then moved for attorney’s fees under a pro-plaintiff fee shifting statute, Civil Code section 1794(d) as well as a positive 1.5 multiplier.  After expressing doubt about whether a multiplier was justified, the trial court awarded the lodestar and requested multiplier to the tune of $327,782.75.

            The 2/4 DCA affirmed.  Plaintiff’s counsel did a good job of showing why this was not a typical lemon law case based on strategic decisions made by defense counsel and getting the trial judge to admit she was surprised at the verdict (which showed good trial skills).  The record at the fee hearing was crucial, getting the lower court to find this was not your typical lemon law case, resulting in a positive multiplier which the defense could not change on appeal. 

Lodestar, Multiplier, Private Attorney General, Special Fee Shifting Statute: Plaintiff Taxpayer Properly Awarded Fee Of $116,647.47 For Prevailing In Political Reform Act Action

60% Total Positive Multiplier And Lodestar Awards Were No Abuse Of Discretion.

            California’s Political Reform Act, codified at Government Code sections 81000 et seq., prohibits a public employee from influencing a governmental decision in which he/she has a financial interest.  There are liability provisions which allow a prosecutor or taxpayer to challenge the particular activity, with the trial judge given the discretion to award attorney’s fees to either the prevailing plaintiff or prevailing defendant. (Gov. Code, §91003(a), 91005.)

            In Holloway v. Vierra, Case No. H044505 (6^th Dist. March 14, 2019) (unpublished), a plaintiff taxpayer challenged a defendant water district director’s receipt of real estate commission benefit in a District real estate purchase under the Political Reform Act. Plaintiff earlier suffered a demurrer without leave, but later revived the action through a successful appeal generating a published opinion. Plaintiff eventually prevailed after a trial, moving for fee recovery under both Government Code section 91003(a) and California’s private attorney general statute. The trial judge awarded him $116,647.47, inclusive of a 60% positive multiplier to bring his attorney’s discounted fees to Bay Area market prices and 10% of the total being a reward for championing a difficult case.

            The Sixth District affirmed the fee award against defendant. There was fee entitlement under both statutory bases. The amount of the fees granted by the lower court was no abuse of discretion. The multiplier properly compensated plaintiff’s attorneys for discounted rates in getting to the proper lodestar amount, with the difficulty and uncertainty of the case also supporting a positive enhancement.

Civil Rights, Multiplier: FEHA Plaintiff’s Appeal Of A Reduced Fee Award Did Not Result In Any Change

Hourly Rates Were Too High, Case Was Overprepared, And Limited Success Before The Jury Supported Lower Court’s Reduced Award.

            FEHA plaintiff in Check v. Raley’s, Case No. A153906 (1^st Dist., Div. 1 Jan. 31, 2019) (unpublished) won $119,211 on some claims, later requesting the trial court to award her $1,109,107 in fees. The lower court found reasons to not honor the request, awarding instead $449,602 and denying a positive multiplier request in the process.

            The appellate court affirmed the reduced fee award. The hourly rates claimed were too high for Sonoma County, a venue with lower rates than other Bay Area locales. The lower court’s 20% overall reduction was in order given its finding that the matter was overprepared by plaintiff’s counsel and involved duplicative attorney work. Finally, a multiplier was properly rejected because the matter was not complex, it was overprepared, and plaintiff had limited success (factors which combined to outweigh the contingency risk factor often leading to the application of a positive enhancement).

Employment, Lodestar, Multiplier: Employer Not Winning Total Defense Victory In De Novo Sup. Ct. Appeal Of Labor Comm. Award Properly Hit With Adverse Fee Award Of $86,160 Even Though Labor Comm. Award Only $4,250 (Rev. Down To $2,250 By Court Of Appeal)

Limited Success Argument Does Not Diminish Fee Recovery In This Particular Context.

            In Nishiki v. Danko Meredith P.C., Case No. A147733 (1^st Dist., Div. 4 Aug. 1, 2018) (published), an employer suffered an adverse Berman hearing award before the Labor Commissioner for waiting time penalties for failure to deliver a check for final wages to the tune of $4,250 although employee lost two other claims for unpaid vacation and rest period premium wages (with the rest period claim being by far and away the largest claim). The employer did a de novo appeal to the superior court, which also awarded $4,250 for waiting time penalties. Employer should have stopped after the Labor Commissioner award, because the superior court awarded employee $86,160 in attorney’s fees (out of a requested $90,900) under Labor Code section 98.2(c). Although there is a very commonsense discussion of waiting time penalties of use for employment practitioners, with the appellate court reducing the penalty award down to $2,250, the fee award was upheld by the 1/4 DCA panel.

            Under section 98.2(c), an employee successful in a de novo appeal, obtaining an amount greater than zero, can obtain the full costs of litigation, including reasonable attorney’s fees, against the employer. The statute is designed to act as a disincentive to appealing the Labor Commissioner’s decision. Employer argued that employee’s fee award was too much because employee did not prevail on two of her claims. This argument was rejected based upon the very particular “disincentive” rationale of section 98.2 and above zero success language of the statute—with the appellate court candidly stating that “defendant has only itself to blame” by appealing the Berman hearing award. The superior court’s award of a 1.5 positive multiplier presented no problem given the contingency risk taken by employee’s counsel. Finally, $650 per hour for a San Francisco 20-plus decade practicing attorney was not an unreasonable lodestar hourly rate.

            BLOG OBSERVATION—An employer needs to carefully consider the appeal of a Berman hearing award, especially where it is in the range here. The employer must appeal quickly, post a full bond or cash undertaking for the award in quick fashion (with the period being jurisdictional), and new claims can be raised by the employee in the de novo hearing—not to mention the fee-shifting disincentive repercussion!

Civil Rights/Multiplier: Ninth Circuit Affirms $5,378,174.66 Civil Rights Fee Recovery, Inclusive Of 2.0 Positive Multiplier, For Five Prisoners Winning Compensatory And Punitive Damages Against County Of Los Angeles And Supervisory Jail Officials

Prison Litigation Reform Act Did Not Cap Unruh Act Fee Recovery.

            In Rodriguez v. County of Los Angeles, No. 13-56292 et al. (9^th Cir. May 30, 2018) (published), the Ninth Circuit reviewed and affirmed 42 U.S.C. § 1983 excessive force verdicts of $740,000 in compensatory damages and $210,000 in punitive damages (the latter against supervisory individual defendants) in favor of five prisoners severely injured during the course of a cell extraction at the L.A. County Men’s Central Jail (which included the use of taser shocks).

            The district judge later awarded plaintiffs $5,378,174.66 in attorney’s fees under the federal civil rights statute and California’s Bane Act (Cal. Civ. Code § 52.1), utilizing separate calculations to arrive at the aggregate fee award. This award included a positive 2.0 multiplier in arriving at the award.

            The Ninth Circuit sustained the fee award in full. The fee limits in the Prison Litigation Reform Act did not apply to cap fees incurred under California Civil Code section 52.1. With respect to the multiplier, it was justified based on the financial risks assumed by the attorneys (who invested $3.4 million in a risky case), the representation of prisoners in an excessive force action against high-ranking jail officials, and the loss of opportunity costs in a litigation which required many years of intensive efforts against aggressive defendants. The district judge also did consider the impact of the award on California taxpayers, finding that the importance of civil rights litigation of this species against large/potentially powerful defendants being such as to outweigh the need for some sort of mitigating fiscal restraint.

Civil Rights/Equity/Multiplier: Although Total Judgment Offset Denied, Fee Award Based On 2.0 Positive Multiplier Reversed On Appeal

Multiplier Is Not Automatic, So Reversed To Consider Proper Factors On Appeal.

            In Campos v. Kennedy, Case Nos. B266663/B268812 (2d Dist., Div. 2 Feb. 13, 2018) (unpublished), plaintiff won a $225,000 compensatory verdict under civil rights fee shifting provisions for sexual battery.  Later, the trial court awarded plaintiff $ 2,924,830 in statutory fees, but augmented by a 2.0 multiplier to a reduced lodestar request.

            The fee award got reversed and remanded on appeal. 

            The defense first tried to argue no fee award was in order because the compensatory award got offset by a good faith settlement offer by another defendant.  The problem with this argument was one of timing, with the defense never making moves to challenge a substantively amended judgment which would take the amount to zero.  The failure to challenge the amended judgment dispatched this argument.

            With respect to the fee award, the appellate court had serious reservations about the 2.0 multiplier awarded by the trial judge.  The main flaw was that the trial judge thought a multiplier was automatic and normally should be awarded, but this is not the law given the lower court must exercise certain factors under Ketchum v. Moses, 24 Cal.4^th 1122, 1138 (2001) [our Leading Case No. 8] to reach such a favorable multiplier result.  However, the appellate court did go on to address multiplier factors, suggesting maybe the trial judge seriously should reconsider his decision on granting a multiplier on remand.

Civil Rights/Multiplier: 2.0 Multiplier Fee Award In FEHA Case Was No Abuse Of Discretion

Compensatory Award Was $1 Million, With $1,945,295 FEHA Award Affirmed On Appeal.

            In Lopez v. City of Beverly Hills, Case No. B268451 (2d Dist., Div. 3 Nov. 30, 2017 unpublished; received for posting Dec. 1, 2017 unpublished), a FEHA plaintiff—after two years of litigation and a 10-day jury trial involving 24 witnesses--won to the tune of $1 million in compensatory damages.  She then sought $2,533,167 in fees (a lodestar plus a 2.0 positive multiplier), with the defense arguing plaintiff should only recover $316,645.88 based on her recovery on certain claims.   The trial judge reduced the lodestar somewhat after finding the unsuccessful claims were intertwined with the successful claims, but did grant the 2.0 multiplier to result in a fee award of $1,945,295.

            The fee award was affirmed on appeal.  The appellate court sustained the trial court’s conclusion that (1) plaintiff’s lead counsel did a good job in trying the case, (2) plaintiff’s counsel advanced $100,000 in hard costs on the case; and (3) the length of the entire matter (even before complaint filing) and contingency risk justified the multiplier enhancement. 

Civil Rights, Lodestar, Multiplier, Reasonableness Of Fees: Trial Judge Properly Cut Lodestar By 25%, And Applied A 1.5 Positive Multiplier, For Total Fee Award Of $752,925.92 In Case Garnering Compensatory Damages Of $625,000 To Plaintiff

Trial Judge Also Properly Awarded $15,000 Supplemental Fees For Posttrial Work.

            For those of you not practicing in the employment/FEHA area, civil rights plaintiffs in disability/harassment/failure to accommodate cases are entitled to recovery of attorney’s fees under a pro-plaintiff statutory fee-shifting provision to be construed liberally to allow plaintiff full compensation for prevailing in these types of cases.  The fee (which must be reasonable and not inflated or subject to other infirmities) is calculated by using the lodestar, namely the number of hours multiplies by a reasonable hourly rate for practitioners in the community where the case was venued, augmented or decreased by certain enhancement factors (with the lodestar sometimes adjusted upward for the plaintiff’s attorney carrying the risk of the case on a contingency basis).  These principles were well summarized and at play in Estelle v. Los Angeles County MTA, Case No. B268085 (2d Dist., Div. 7 Nov. 17, 2017) (unpublished), authored by a 3-0 panel by Justice Segal.

            In Estelle, Plaintiff, an MTA business driver obtained a jury verdict of $625,000 in a disability/failure to engage in interactive process case.  Under the FEHA fee-shifting statute, plaintiff then requested total fees of $1,171,128, which was inclusive of a 1.75 positive multiplier enhancement.  The lower court reduced the base lodestar by 25% for plaintiff’s unsuccessful work on some claims, but did positively adjust the reduced lodestar through an award of a positive 1.5 multiplier—resulting in a total fee award of $752,925.92.  Later, plaintiff requested supplemental fees of $75,640.50 (lodestar plus a positive 1.5 multiplier request) for posttrial work, but the trial judge found this excessive and awarded $15,000 instead.  All this prompted an appeal by the defense.

            Nothing changed on appeal.  The 1.5 multiplier was no abuse of discretion especially given that the case was taken on a contingency basis and the lawyering was found to be acceptable.  Supplemental fees for posttrial and appellate work are allowed under interpretative case law, with the trial judge exercising judgment in reducing for what he deemed to be excessive work when fashioning his $15,000 award.

Class Action, Common Fund, Employment, Lodestar, Multiplier: N.D. Cal. District Judge Ilston Awards Wage/Hour Class Action Counsel $15,200,002.90 In Hybrid Statutory Fee/Common Fund Case Against Wal-Mart

District Judge Confronts Multiple Issues In Reaching Fee Award.

            U.S. District Judge Susan Ilston in Ridgeway v. Wal-Mart Stores, Inc., Case No. 08-cv-05221-SI (N.D. Cal. Sept. 14, 2017 Doc. #606) confronted numerous issues in deciding the appropriate award to class counsel in a truck driver employee class action case against Wal-Mart for wage hour violations, with a judgment producing a $60.8 million common fund available for distribution to class members.  Eventually, as we detail below, District Judge Ilston awarded $15,200,002.90, 25% of the common fund, although she did an analysis under both the fee-shifting statute (California Labor Code section 1194(a)) and the common fund doctrine.

            As an overview, District Judge Ilston characterized this as a “hybrid action,” involving potential fee recovery under a specific fee-shifting statute and the common fund doctrine.  Class counsel wanted a fee recovery of $20,266,670.50 (one-third of the common fund), while Wal-Mart argued that no more than $2,831,149.09 should be awarded—quite a discrepancy. 

            On the Labor Code fee-shifting front, she found that the hourly rates requested were acceptable, decided to make no reductions for vague time entries, and did not reduce for block billed entries under the circumstances.  District Judge Ilston also found that 64% time billing by higher level partners was appropriate for the case, determined that most of the time on lost or abandoned claims were interrelated to successful claims (doing a minor reduction for meal break claims), and put an imprimatur on continuing education work which aided class counsel in their work.  However, she did make reduction for these items:  (1) 30% reduction in travel time for class counsel from mainly Fresno to the San Francisco court venue; (2) a 5% across-the-board reduction proposed by class counsel for redundant work, plus a little more too [HINT TO PRACTITIONERS—class counsel was wise to propose this reduction even though they did not have to, the district judge accepting this as overall reasonable in nature]; and (3) no allowance for class counsel’s legislative lobbying efforts.  That brought the lodestar request down to $6,491,662.12 (down from the requested $7,320,454.75).  Class counsel requested a 2.71 positive multiplier and Wal-Mart advocated zero.  After agreeing that contingent risk, results obtained (each class member would likely get around $70,000), complexity, and preclusion of employment factors tilted in favor of a positive multiplier, District Judge Ilston granted a 2.0 positive multiplier, for a total statutory-fee award of $12,983,324.25. 

            That shifted things to fee recovery under the common fund doctrine.  She acknowledged that the Ninth Circuit has a 25% presumptive percentage-of-recovery award in common fund cases, although this had not been adopted conclusively by California state courts (given that diversity law applied).  Plaintiff asked for one-third, but District Judge Ilston decided to go with the 25% benchmark.  So, that meant that the total fee award based on the 25% was $15,200,002.90, with an offset allowed for the prior $12,983,324.25 statutory fee award, such that an additional $2,216,678.65 was added through the common fund doctrine.  When all the math is done, $15,200,002.90 is the result, plus some additional costs and litigation expenses.

Multipliers/Reasonableness Of Fees: $2.5 Million Fee Award To Class Counsel Was No Abuse Of Discretion

 

 

Class Counsel Appealed, But To No Avail Except On Two Minor Issues.

 

            Woosley v. State of California, Case No. B261454 (2d Dist., Div. 5 April 24, 2017) (unpublished) was a dispute which spanned close to 40 years, with the parties then hassling over attorney’s fees over the last dozen years.  (Kinda echoes our Mission Statement-- "All too often attorney fees become the tail that wags the dog in litigation."  Deane Gardenhome Assn. v. Dentkas, 13 Cal.App.4th 1394, 1399 (1993).)  What first happened was that a prior judge awarded $23 million to class counsel under the private attorney general statute (just about the full request and with multipliers for most work), a determination which was reversed and remanded to reconsider in light of lack of success on claims after a California Supreme Court decision reduced the underlying judgment.  A new judge actually held a live evidentiary hearing, awarding a total of a little over $2,516,000 to class counsel, reducing the lodestar for inefficiency and excessive internal/external communications by counsel, only awarding a 1.25 multiplier due to lack of success for work on some claims, and refusing to award a “delay premium.”

            On appeal, the 2/5 DCA found no abuse of discretion, except the majority justices remanded for two minor reconsiderations:  (1) failing to allow some attorneys to reopen to present detailed billing statements not allowed by the prior judge; and (2) considering fees on fees for an older 1985 fee application by one set of attorneys.  In doing so, the appellate court rejected the notion that the trial judge had to identify each time entry which he or she found objectionable.  In a dissenting and concurring opinion, Presiding Justice Turner would have affirmed across the board, finding that it was not an abuse of discretion to deny the motion to reopen.  Although unpublished, the case has good discussions on lodestar reductions, application of multiplier reductions, and discretionary “delay premium” analysis.

Civil Rights/Multiplier: $1,163,977.50 FEHA Fee Award Affirmed On Appeal

 

Case Tells Government Entities To Beware When They Aggressively Litigate And Lose In Pro-Civil Rights Fee Shifting Cases.

   The next case is one that litigators representing governmental entities need to pay attention to.  Often times, government will aggressively litigate until the end, only to tell the appellate court that fees to a successful party were excessive or multipliers unjustified despite the contingency risk absorbed by the winning party’s counsel showing great acumen to prevail in the matter.  Williams v. L.A. County Metropolitan Transportation Auth., Case No. B259327 (2d Dist., Div. 3 Apr. 5, 2016) (unpublished) shows that governmental entities faced with the right facts will not win a “Hail Mary” attempt on appeal.

    In this one, plaintiff prevailed on a disability discrimination-related FEHA case, requesting a lodestar plus a 2.0 multiplier in a case where Metro aggressively contested all along the way.  Plaintiff’s counsel requested $600 per hour for lead counsel (17 years of experience) and $325-425 for junior counsel (6 years of experience).  The trial judge granted the lodestar, augmented by a 1.5 positive multiplier based on the skill shown by plaintiff’s counsel in the case plus the contingency risk absorbed by the same counsel.  Once “fees on fees” were added, the total fee award to plaintiff was $1,163,977.50.

    This award was affirmed on appeal.  The lodestar component of the award was not challenged on appeal, just the multiplier.  However, the appellate court found it was appropriate in light of the demonstrated skill and contingency risk factors.  It found that the prior case of Weeks v. Baker & McKenzie, 63 Cal.App.4th 1128, 1175 (1998) was trumped by Ketchum v. Moses, 24 Cal.4th 1122, 1132-1133 (2001) [one of our Leading Cases], which does allow consideration of contingency risk in FEHA and other cases.  Finally, the “scorched earth” plea by Metro, which itself left no stone unturned, did not resonate in light of plaintiff having no choice but to respond in kind. 

Employment, Lodestar, Multiplier, Record: Plaintiff Employee Obtaining $43,654.50 On Unpaid Commission Claim Awarded $58,341.50 Under Labor Code Fee-Shifting Statute

 

Plaintiff Requested $212,287.50 (Inclusive Of A 1.5 Multiplier), But Lower Court’s Award Of A Reasonable Lodestar Was No Abuse of Discretion.

     Plaintiff employee eventually obtained recovery of $43,654.50 in an unpaid commission dispute even though he at one point was willing to accept $75,000 to settle which included a $30,000 component to reimburse his attorney for fees under a contingency agreement. Plaintiff then sought recovery of $212,287.50 in fees under Labor Code section 218.5’s fee-shifting provision (with the request including a 1.5 positive multiplier). The defense suggested $30,000 was a reasonable award, but the trial judge awarded plaintiff $58,341.50 as a reasonable fee lodestar, denying the request for any multiplier.

     Plaintiff’s appeal that the fee award was too small did not prevail in Philpott v. Midwest Roofing Co., Inc., Case No. B262185 (2d Dist., Div. 5 Jan. 15, 2015) (unpublished).

     The trial court cut the amount of lodestar hours and the hourly rate, with some explanations for his order at the fee hearing. One of the problems was the lack of a reporter’s transcript so the reviewing court could see what occurred at the fee hearing—a problem we have chronicled in other posts. However, given that the trial court found the matter was not complex and that plaintiff had been willing to accept $30,000 in fees before the first day of trial (which was not that long), the trial judge was within the range of acceptability by nearly doubling the settlement request as a check on the fees he actually awarded. The refusal to award the multiplier was no abuse of discretion either, in light of the relative non-complexity of the case (with only the contingency risk factor supporting a multiplier, while no other multiplier-justifying factors were in play).

Civil Rights: $870,720.63 Fee Award To Winning FEHA Plaintiff Affirmed On Appeal Where $749,999 In Compensatory Damages Awarded By Jury

 

1.25 Multiplier Sustained; Reversal of One Intertwined Retaliation Claim Did Not Require Reconsideration Of Fee Award.

William A. Offutt, winner of adding machine operators contest, 1937.  Library of Congress.

    In Warehime v. Farmers Ins. Exchange, Case No. F068843 (5th Dist. Dec. 15, 2015) (unpublished), plaintiff brought a four-count FEHA inspired suit against Farmers, winning $749,999 on all four claims.  Then, in the post-trial aftermath, the trial judge awarded plaintiff $696,576.50 out of a requested $747,115.50 for the base lodestar, augmented by a 1.25 positive multiplier for a total fee award of $870,720.63.  Fee entitlement was undisputed, based on a FEHA fee-shifting statute.

    The fee award was affirmed on appeal to the Fifth District.

    Justice Levy, on behalf of a 3-0 panel, did reverse the merits verdict on the retaliation claim, but this did not require a revisit of the fee award because affirmance of the verdict on the other counts—intertwined claims—did not mandate another look-see.  The 1.25 multiplier was justified given that plaintiffs’ counsel took the case on contingency, with the panel observing that it was “relatively modest” and less than the 1.5 multiplier requested by plaintiffs’ counsel.

In The News . . . . Lead Plaintiffs’ Attorneys Receive Close To $12 Million In Student Athlete Likeness Class Action Against Electronic Arts and NCAA

 

                       Dartmouth Football Team, 1901.

1.7 Multiplier Awarded By N.D. Cal. District Judge.

 

    On December 10, 2015, U.S. District Judge Claudia Wilkens of the Northern District of California awarded lead plaintiffs’ counsel almost $12 million in fees for work leading to the settlements in a class action case brought by student athletes for misappropriation of their likenesses without permission.  District Judge Wilkens awarded a 1.7 multiplier to the $6.8 million base lodestar, citing the outstanding results—about $60 million in settlements between the two defendants—for six years of hard-fought litigation engaged in by lead class counsel.  This award was in Keller/O’Bannon v. NCAA, Nos. C09-1987 CW and C09-3329 CW.