CALIFORNIA ATTORNEY'S FEES

Default Judgment, Reasonableness Of Fees, Requests For Admission: Lower Court Properly Rejected Default Judgment Request Of About $308,000 In Fees Where Compensatory Damages Were Around $48,000

Fee Award Of $4,498.46 Was Proper, Given Inflated Fee Request; Costs Of Proof Sanctions Of $11,852.50 Out Of A Requested $123,016.40 Was Not Improper.

               As only Justice Wiley can do in his individual writing style, he reminds us in LCPFV, LLC v. Somatdary Inc., Case No. B325599 (2d Dist., Div. 8 Nov. 13, 2024) (published), that lower courts are gatekeepers in terms of entering reasonable default judgments, including those with inflated fee requests which will get rejected or scaled back as far as the fee recovery, more than a 90% reduction.

               Over a dispute of about $48,000 over a rusty pipe repair, a default judgment was submitted for $1.1 million (inclusive of a $308,000 fee request and $500,000 punitive damages request).  The lower court would have no part of this, because the defaulted party did not really resist, awarding $120,319.22 in a default judgment, which included attorney’s fees of $4,498.46.  It also rebuffed an RFA costs of proof sanctions request of $123,016.40, awarding just $11,852.50.

               All the awards were affirmed on appeal.

               C’mon said the appellate court, the lower court is a gatekeeper on reasonableness and did a good job on entering much reduced awards.  As far as the fees, here were the takeaways for reducing a $380,000 request down to under $5,000:

• • • The award was against a “no show” defendant, so the matter was not vigorously contested;
    • The award included duplicative work efforts which were not justified;
    • The issues in the case were simple, not justifying a fee request for a complex matter;
    • The fee request would be reduced based on the requesting party’s lack of candor in its overall default judgment submission; and
    • The fee request was shocking in amount, justifying a drastic reduction (as made) or alright denial.

Deadlines, Reasonableness Of Fees: Make Sure You File/Serve Fee Oppositions Correctly And On Time

Also, Admissions In Appellate Brief Extension Requests Can Undermine A Claim That Fees Were Unreasonable Based On Non-complexity.

               Currency Corp. v. Wertheim, LLC, Case No. B326827 (2d Dist., Div. 1 Nov. 5, 2024) (unpublished), where a substantial appellate fee award of $338,535 was sustained on appeal in favor of prevailing respondents, has some lessons for litigants and practitioners when opposing fee awards.  First, make sure that the fee opposition paperwork is properly served and correctly filed—here, the opposition had an incorrect case number, it was served by express mail on the due date (one day too late), and served upon an incorrect suite for one of the moving parties’ attorneys (four days too late).  Also, on the merits, be careful of statements you make in requesting appellate briefing extensions—here, the appellants’ representations that the case was complex and had a voluminous record undermined its appellate argument that the case was not complex so as to justify the work efforts of respondents on appeal.

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).

Reasonableness Of Fees: $1,050,000 Fee Award Affirmed In Penal Code Section 496(c) Case Where $1.5 Million Awarded Against Certain Defendants And $900,000 Against One Defendant

Hourly Rates Are Left To Trial Judge’s Experience, With Reliance On Surveys And Matrices Left In His/Her Discretion.

               In CJ Freshway America Corp. v. Lim, Case Nos. B321415/B322905 (2d Dist., Div. 8 Oct. 14, 2024) (unpublished), certain defendants were found jointly and severally liable for over $1.5 million and another defendant was found liable for $900,000 for receiving stolen property belonging to plaintiff, which triggered the fee-shifting clause under Penal Code section 496(c).  Subsequently, after plaintiff first asked for $1.75 million and then reduced the “ask” to $1.566 million, the lower court awarded $1,050,000 to the defense.  The appellate court affirmed.  In essence, the hourly rate is a discretionary lower court call, with it not having to credit any specific survey or matrix at arriving at a fair rate.  There was no abuse of discretion in the award, given the reductions by the lower court.

Landlord/Tenant, Mediation, Reasonableness Of Fees, Section 1717: Most Of $363,696.70 Contractual Fee Award Affirmed In Landlord/Tenant Dispute

However, N.Y. Attorneys’ Time After California Counsel Retained Must Be Stricken Because He Was Not Licensed In California.

               In Thaunhaeuser v. TKH Zum, LLC, Case No. B321283 (2d Dist., Div. 8 Oct. 11, 2024) (unpublished), the lower court entered a $114,000 compensatory judgment against landlord and in favor of tenant under a property condition/security deposit lawsuit.  Later, based on a contractual fees clause under the lease, the lower court awarded $363,696.70 to prevailing tenant, including some services which were performed by a New York attorney not licensed in California before California counsel was retained by tenant.  The 2/8 DCA rejected most of landlord’s arguments on appeal, except for one which required a modification to the fee award.

               Landlord argued tenant did not satisfy the mediation condition precedent provision of the lease, but the record belied this argument:  tenant did send a letter asking for mediation dates as well as made a settlement offer which landlord rejected.  The presence of the alternative settlement offer did not override tenant’s attempts to engage in mediation.

               However, the fees of the New York attorney were ordered stricken for work postdating the retention of California counsel.  New York counsel was actively advising tenant such that he needed to be licensed and failed to seek pro hac vice admission, with the appellate panel expressing doubt that California Supreme Court’s Birbrower, 17 Cal.4^th 119 opinion allowed a non-licensed attorney in a firm with a California attorney to avoid the problem and also indicating doubt that a non-licensed attorney could avoid problems by associating in with a California attorney in a lawsuit.  A remand was required to modify the judgment to exclude the non-compensable time.

               The size of the award was no abuse of discretion:  375 hours for four years of litigation was reasonable, with $750 per hour being acceptable for the California retained counsel who had many years of litigation experience in the landlord/tenant area.

Celebrities, Reasonableness Of Fees, Section 998: The Offspring’s Former Drummer Lost A Contractual Interpretation Dispute, With $856,818 In Contractual Fees Affirmed On Appeal

Defense Section 998 Offers Found Not To Be Uncertain.

               Ron Welty, former drummer of the band The Offspring, sued the band and other affiliated defendants on a contractual interpretation over royalties, with there being a contractual fees clause at issue.  He asked for $2.9 million in damages, but he recovered nothing.  The defendants then moved for substantial attorney’s fees, which were granted.

               His appeal in Welty v. Offspring, Inc., Case No. B328648 (2d Dist., Div. 2 Oct. 9, 2024) (unpublished) was unsuccessful.

               After 2 ½ years of intensive litigation, some defendants were awarded a total of $856,818 in contractual fees and another group $20,013 in costs.  The appellate court affirmed, finding the awards were no abuse of discretion.

               On the fee awards, block billing and billing in quarterly hour increments—although not ideal—did not prevent the lower court from making an appropriate award.  The two defense section 998 offers were not invalid:  all were targeted at Mr. Welty, so no apportionment needed to be made as generally may need to be made where multiple plaintiffs are involved, and no authority suggested that a 998 offer was infirm where it asked all parties to bear their own fees and costs. 

Employment, Reasonableness Of Fees, Section 998: FEHA Plaintiff Finally Winning $1.25 Million In a Third Jury Trial, After An Earlier Appellate Reversal On The First Trial And A New Trial On The Second Trial, Was Properly Awarded $3,264,906 In Fees

Both Sides Appealed, But Their Challenges Were Unsuccessful.

               Simers v. Los Angeles Times Communications LLC, Case No. B323715 (2d Dist., Div. 8 Aug. 30, 2024) (published) involved a long-standing dispute between plaintiff T.J. Simers, a controversial columnist, and defendant L.A. Times involving constructive termination, age discrimination, and disability discrimination claims under FEHA.  Needless to say, there were three jury trials producing this chronology:  (1) a first jury trial resulted in over $7.137 million in damages, which was reversed and remanded on appeal for a new trial; (2) a second jury trial resulted in an award of $15.4 million in noneconomic damages, with the lower court granting a new trial on that result; and (3) a third jury trial resulted in a noneconomic damages verdict of $1.25 million, even though this matched an identical defense CCP § 998 offer for that amount plus reasonable pre-offer fees and costs to be determined by the lower court (a rejected offer).  Plaintiff requested attorney’s fees of $15.5 million (lodestar plus a 2.0 multiplier) involving time on all three trials and the appeals after the first trial.  The defense raised various objections, some of which were credited, eventually resulting in an award to plaintiff of $3,264,906 in attorney’s fees.  (Plaintiff was awarded $210,882.22 in costs, but that award was not contested on appeal.)  Both sides appealed, defendant claiming the award was excessive, and plaintiff contending the section 998 offer did not cut-off post-offer fees.

               The 2/8 DCA opinion, authored by Justice Grimes, affirmed the fee determinations. Here are the takeaways on this appeal, which did involve unique circumstances (mainly the multiple new trials):

• • • The lower court did possess considerable discretion to allow or disallow (or go within those two extremes) fees for the second trial and appeal even though a new trial was granted for attorney misconduct—the trial judge does not have to disallow all fees requiring a third trial if the penalty for misconduct is too harsh with respect to a fee award.
    • The second trial was related sufficiently to the overall result such that it could be compensable.
    • Plaintiff’s work on the unsuccessful appeal from the first trial verdict was compensable in the lower court’s discretion.
    • The defense 998 offer did cut off attorney’s fees and costs after the rejected, successful 998 offer was borne out to match plaintiff’s ultimate recovery.

Reasonableness Of Fees: Plaintiff Home Designer Winning $64,000 In Compensatory Damages And Defeating Owner’s Unlicensed Contractor Defense/Cross-Claims Was Properly Awarded Prevailing Party Fees Of $1,568,501

Owner Over-litigated The Case, With Fee Awards Not Having To Be Proportionate To A Litigant’s Recovery.

               Attorney’s fees awards can be substantial, especially where an opposing party over-litigates a case and drives up the prevailing party’s litigation expenses.  That is what happened in Zale Design Studio v. Leevan, Case Nos. B324871 (2d Dist., Div. 1 Aug. 28, 2024) (unpublished).

               Plaintiff home designer sued defendant owner, who raised an unlicensed contractor defense and brought cross-claims for fraud and under RICO (with the RICO claim knocked out on a demurrer).  The case was litigated over about 7 years.  A jury awarded $64,000 to designer, answered special verdict interrogatories finding she did not have to be a licensed contractor, and found against owner on his cross-claims.  Under a prevailing party contractual fees provision, the trial judge awarded designer the full lodestar ask of $1,568,501 over fee objections by owner, although the lower court refused designer’s 1.5 positive multiplier request.

               The 2/1 DCA affirmed the jury’s verdict and the fee award.  It agreed with the lower court that owner had over-litigated the case and that he had refused two CCP § 998 offers from plaintiff (one of which required her to pay him $100,000).  Finally, the Court of Appeal cited a case indicating that a fees award does not have to be proportional to the ultimate recovery—even though plaintiff did more than get a compensatory award because she also defeated owner’s cross-claims.  (See Taylor v. Nabors Drilling USA, LP, 202 Cal.App.4^th 1228, 1251 (2014).)

               BLOG OBSERVATION—This case has a nice discussion of unlicensed contractor and mechanics lien principles as applied to home designers who do no installation or where only removable items are installed.  Interestingly, plaintiff admitted that she had overcharged owner and included some false charges, but she gave credit for these errors—with the jury finding she did defraud owner, yet it caused no damages. 

Reasonableness Of Fees, SLAPP, Substantiation Of Reasonableness Of Fees: Successful SLAPPing Defendant Entitled To An Award Of $48,790 In Fees And $1,574.60 In Costs

Winning Defendant Did Something Smart:  After SLAPP Motion Granted, Offered To Stipulate To A Much Lower Fees And Costs Award, Rejected By Plaintiff.

               When it comes to the reasonableness of a fee award, we have posted on situations where the prevailing party offered to stipulate to a lower fees/costs award and then obtained a higher fees/costs award after that offer was rejected.  Proof of this was made in Aminpour v. Verdi, Case No. B327213 (2d Dist., Div. 5 Aug. 21, 2024) (unpublished), with the lower and appellate courts persuaded that the defense higher fee request was justified in part by an attempt to resolve the controversy by the winning side.

               In this one, the defense prevailed on a SLAPP motion, including having to reply to a 150-page opposition by plaintiff.   Before any fees/costs motion was filed by the prevailing defendant, his counsel sent an email willing to stipulate to a definite fees/costs award in order to avoid further expenses to file an actual attorney’s fees motion, an offer which was not responded to apparently.  Later, the trial judge ordered a higher fees award of $48,790 and higher costs award of $1,574.60 to defendant.  Plaintiff appealed, but the appellate court determined the awards were no abuse of discretion because (1) plaintiff had argued that he should be awarded $56,225 in fees in an earlier pleading, such that the work by plaintiff demonstrated the defense request was not outrageous, citing In re Tobacco Cases I. 216 Cal.App.4^th 570, 584 (2013); (2) the “fees on fees” to bring the fee motion were allowable; and (3) sufficient declaration testimony was presented to support the award given no billing records/invoices were required (although as bloggers, we would say they are highly advisable).

Reasonableness Of Fees: Despite Challengers Prevailing In Private Attorney General Dispute, They Appealed, Arguing The Fee Award Should Be More

No, The Actual, Roughly $105,800 Fee Award Out Of A Requested $330.363.75, Inclusive Of A 1.5 Multiplier, Was Affirmed—No More Awarded.

               In a recent post, we blogged on the affirmance of a $105,800 fee award (roughly) to challengers in a private attorney general award, and they got there barely under an abuse of discretion standard.  Interestingly, the challengers argued that their fee request of $330,382.75 (inclusive of a 1.5 positive multiplier) should have been granted by the lower court rather than the lower award. The Fifth District disagreed in Westlands Water Dist. v. North Coast Rivers Alliance, Case No. F085567 (5^th Dist. Aug. 5, 2024) (unpublished).

               The lower and appellate courts’ reasoning in this matter is a fee auditor affirmation on why reductions should be done for these activities:  the hourly rates were excessive (Northern California versus Central California rates); there was no showing that Bay Area counsel representation had to be obtained on a case of this nature because no evidence was provided to show why local counsel could not be obtained; fee applicants’ expert witness only offered generalized opinions, not geared to the specifics of the case; and excessive time on many tasks, especially processing Case Management Statements, drafting stock Answers to a Complaint, appellate work involving “cutting and pasting” with not much more originality, and more mundane tasks. The trial court reductions for specific tasks were no abuse of discretion based on its ruling and the appellate record, where reductions were considered.

Eminent Domain, Reasonableness Of Fees: City Losing Summary Judgment Motion In Eminent Domain Proceeding Was Properly Saddled With $246,744.50 In Fees

Summary Judgment Grant Was A Predicate For CCP § 1268.610 Fees, And Lower Court Made Reductions For Duplicative Work.

               In City of Ontario v. We Buy Homes Any Condition, LLC, Case No. D083080 (4^th Dist., Div. 1 July 19, 2024 filed) (published on July 31, 2024), City lost an eminent domain case at the summary judgment stage, a determination affirmed on appeal.  The lower court also awarded the defense $246,744.50 in CCP § 1268.610 attorney’s fees for prevailing, reducing the “ask” request of $331,161.50 downward.  City’s appeal of the fee award was unsuccessful.  The appellate court determined that a SJM grant was a dismissal which qualified the defense for fees under section 1268.610.  With respect to the amount of fees awarded, there was no abuse of discretion—the lower court reduced a second firm’s fees by 70% and also reduced lead partners’ time on the SJM by 50%, showing a reasonable exercise of discretion. 

Costs, Deadlines, Probate, Reasonableness Of Fees, Special Fee Shifting Statutes: $175,252.50 Fee Award Under Financial Elder Abuse Statute Affirmed On Appeal

Fee Request Reduced Down From $203,865; Two Awarded Routine Costs Components Remanded For A Further Hearing.

               In Thompson v. Ito, Case No. G061437 (4^th Dist., Div. 3 June 12, 2024) (unpublished), a defendant losing a trust undue influence case and determined to have committed financial elder abuse was hit with an adverse attorney’s fees award of $175,252.50 out of a requested $203,865 (reductions made based on excessive hourly rates, clerical work, and some discovery work not allowed by the lower court).  The award was made under Welfare & Institutions Code section 15657.5, providing that a fee award is mandatory where financial elder abuse is found.  The lower court also awarded the full costs request of $27,961.07 to the winning plaintiff. 

               Defendant’s appeal was mainly unsuccessful except for a remand to have a further hearing on two components of the costs award.

The argument that no attorney’s fees could be awarded while a merits appeal was pending (with the financial elder abuse findings affirmed earlier) lacked merit because the issue was a collateral matter not embraced within the merits judgment.  (Bankes v. Lucas, 9 Cal.App.4^th 365, 369 (1992), superseded by statute on other grounds; Korchemny v. Piterman, 68 Cal.App.5^th 1032, 1052 (2021).)

               Fees were mandatory against a party found to have committed financial elder abuse, so no “prevailing party” analysis was necessary.

               The fee award was no abuse of discretion, given that the lower court did reduce the request, that appellant raised new arguments on appeal (with those challenges forfeited), and that appellant failed to specify which block-billed entries should be disallowed.

               With respect to the costs award, appellant did not file a motion to tax costs, but the lower court did not err in allowing entertainment of his fee opposition challenges to costs.  Two components, the award of lodging and parking costs (which are discretionary items to be allowed or disallowed) for one person—totaling $2,468.67—was reversed and remanded because it was unclear the role of the claiming person in the case.  However, because the costs claimant would be given the opportunity to meet this objection, the matter was remanded to have a hearing on these two costs components only.

               Justice Motoike authored the 3-0 unpublished opinion.

Allocation, Indemnity, Reasonableness Of Fees: Defendant/Cross-Complainant Winning $48,511.50 On Certain Intentional Tort Claims And Defeating A Complaint In An Occupancy License Indemnity Dispute Properly Awarded $225,894 In Contractual Attorney Fees

Opposing Party Did Not Adequately Provide A Litigation History Roadmap, Never Suggested A Reduced Award Amount, And Never Attacked Specific Billing Entries; No Allocation Necessary Because Work Was Inextricably Intertwined.

               Cubework.com, Inc. v. Solo Trading, Case No. B330959 (2d Dist., Div. 1 June 6, 2024) (unpublished) has some nice tips for what opposing parties may need to do as far as attacking a fee request and shows how a fees claimant did the right thing by voluntarily eliminating duplicative entries.

               In this case, plaintiff lost on its claims under an occupancy license agreement having an indemnity clause, but defendant won $48,511.50 in compensatory damages on its cross-complaint under some intentional tort claims where the lower court found willful misconduct by plaintiff/cross-defendant.  Then, winning cross-complainant moved for fees after voluntarily reducing 90 duplicative entries.  The lower court awarded the full ask of $225,894, given the litigation spanned over two years.

               Cubework’s appeal of the fee award was unsuccessful.  The indemnity clause was direct between the two parties, with the trial court finding willful misconduct by Cubework under the intentional tort claims although that type of misconduct was not substantively necessary—but it existed and satisfied the indemnity condition for an award of fees.  There was no need to apportion fees for unsuccessful work as to another party dismissed before trial because it was intertwined with successful work on the intentional tort claims.  Because the fee claimant voluntarily eliminated duplicative entries and the time/hourly rates were reasonable to the lower court, the appellate court could not find the award was shocking, even though the lower court acknowledged it was much more that the compensatory damages award.  The appellate panel also observed that the opposing party failed to provide an adequate litigation history record, did not suggest a reduced award number at oral argument, and did not attack specific billing entries.  These observations provide some valuable tips in moving for and opposing fee requests in state court (although the same tips likely are apt in federal court).

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.

Family Law, Reasonableness Of Fees: Marital Settlement Agreement Did Not Preclude Needs-Based Fees To Ex-Husband, But Remand Required Because Appellate Court Could Not Determine The Basis Of The $10,000 Needs-Based Award To Wife

She Asked For $72,355, With Appellate Court Unsure As To How This Amount Was Reached.

            Both ex-husband and ex-wife were unhappy with needs-based awards to each in Konkov v. Doubson, Case No. H050705 (6^th Dist. May 14, 2024) (unpublished).  Both appealed, with mixed results but not certain that anything would change on remand.

            Ex-husband was awarded needs-based fees of $14,000, with ex-wife contending that they were not allowed under the terms of a marital settlement agreement.  This argument was rejected, since nothing in the agreement addressed, much less waived, needs-based fees.

            Ex-wife was awarded needs-based fees of $10,000 out of a requested $72,355.  This order was reversed and remanded, given that the appellate court could not determine how it was reached.  A rare abuse of discretion reversal.

Reasonableness Of Fees: $69,930 Was The Fee Award In An Unlawful Detainer Action Where A Summary Judgment Was Granted During COVID Times

Incivility Defense Not Accepted By The Lower Court.

               A plaintiff landlord during the COVID pandemic suffered an adverse summary judgment in an unlawful detainer case, fighting all the way—which litigants are entitled to do.  In Lighthouse Brooks, LLC v. Affinity House, Inc., Case No. B323615 (2d Dist., Div. 4 May 9, 2024) (unpublished), the appellate court affirmed an attorney’s fees award of $69,930 to tenant over landlord's objections.  Landlord argued fees should be reduced because tenant’s counsel was guilty under the “incivility card” defense (which we have blogged on in some very recent posts, such as in Snoeck v. ExakTime Innovations, Inc., 96 Cal.App.5^th 908, 911 (2023)).  At best, however, one alleged act of incivility was at issue, with the trial court rejecting the need to reduce fees given other cases have much more pervasive conduct involved.

Reasonableness Of Fees, Special Fee Shifting Statutes: $47,513.67 Fee Award To Hospital and Medical Staff Affirmed On Appeal In Peer Review Proceeding

$71,270.50 Request, Reduced, Was Proper, With Appellant’s Technical Arguments Rejected.

               In Nowzari v. Torrance Memorial Medical Center, Case No. B321862 et al. (2d Dist., Div. 2 May 2, 2024) (unpublished), a plaintiff physician’s hospital privileges were restricted by a peer review body, triggering physician’s filing of a petition for a writ of the mandate to overturn the board’s decision although the petition was denied.  Hospital and medical staff defendants were awarded statutory fees of $47,513.67, two thirds of the request, under Business and Professions Code section 809.9.

               The 2/2 DCA affirmed.  Section 809.9 empowers a trial court, when litigating a writ petition challenging a peer review decision, to award costs inclusive of reasonable attorney’s fees to the party who “substantially prevails” on any claim that is “frivolous, unreasonable, without foundation or in bad faith”—a sanctions provision.  A claim is “without foundation” where it is factually or legally baseless, groundless, or without support, and a claim is “unreasonable” where no reasonable attorney would find it tenable.  (Smith v. Selma Community Hospital, 188 Cal.App.4^th 1, 30-32 (2010).)  Because these components are determined objectively, they are subject to de novo review.  Independently reviewing the record, the appellate court found no error.  It also dismissed technical arguments we have seen raised in many fee or sanctions proceedings in the past:  (1) attorney’s fees need not be pled except in cases of default (Carlsbad Police Officers Assn. v. City of Carlsbad, 49 Cal.App.5^th 135, 142 n. 3 (2020)); and (2) the trial court was not divested of jurisdiction to determine a fee/sanctions award once physician filed his notice of appeal (Code Civ. Proc., § 916; Robertson v. Rodriguez, 36 Cal.App.4^th 347, 360 (1995)).

Eminent Domain, Reasonableness of Fees, Substantiation Of Reasonableness Of Fees: Unreasonable Demands And Lack Of Substantiation Caused A Substantial Fee Request Haircut

Plaintiff Wanted $1.942 Million; However, Trial Court Properly Awarded Only $360,438.45 In Fees.

[U.S. Army induction center, ca. 1942]. Getting haircuts. CA 1942. Library of Congress

               This next case illustrates how fee requests need to be reasonable and supported by proper substantiation.  If not, the litigant will get a sizable “haircut,” which is exactly what happened in Medical Acquisition Co., Inc. v. Tri-City Healthcare Dist., Case Nos. D079471 et al. (4^th Dist., Div. 1 Apr. 17, 2024) (unpublished). 

               Plaintiff entity sought reasonable litigation expenses, which include attorney’s fees, under CCP § 1268.610 in an eminent domain action, even though other distinct claims were involved.  Plaintiff requested recovery of about $1.942 million in fees, broken down as $1.225 million for the main firm based on a contingency agreement and with the remainder being requests by in-house counsel and three other law practices for their contribution to the case.  However, the lower court only awarded $360,438.45 in fees because it found the lodestar calculation to be fair for primary counsel and finding that there was improper substantiation for the remaining attorneys because hourly rates and hours worked were not shown, not to mention there was duplication in the services they provided.  On appeal, the 4/1 DCA discerned no abuse of discretion, reminding us all that fee requests need to be reasonable in nature even at the moving paper stages of a fee proceeding under penalty of getting nothing or substantial fee reductions.

Reasonableness Of Fees: In IDEA Case, District Court Did Award Fees, Albeit Reduced—Our First Artificial Intelligence Post!

District Judge Disregarded AI Computation On Hourly Rates.

            Okay, everyone following our blog, we have our first Artificial Intelligence (AI) case on a fee motion.

            In J.G. v. New York City Dept. of Education, No. 23 Civ. 949 (PAE), S.D.N.Y. (Doc. 32, 2/22/2024), the district court was considering a fee request to a prevailing party after two administrative hearings under the Individuals with Disabilities Education Act (IDEA) fee-shifting statute.  The requesting party asked for $113,484.62 in fees and costs, with the district court ultimately awarding $53,050.13 after the party eschewed a $54,300 settlement offer.  In reaching its result (after acknowledging IDEA is a niche legal area not akin to more generalized practices), what the district court did do was to reject an artificial intelligence analysis of hourly rates as being unpersuasive and unreliable.  In so doing, it quoted other cases determining that AI data needed to be really scrutinized by the attorneys relying on it before submission of that data to the court.

Costs, Reasonableness Of Fees, Unlicensed Contractors: Owners Winning Small Amount In Unlimited Case Against Unlicensed Contractor Were Not Entitled To Attorney’s Fees Or Routine Costs

Reason Was That Owners Sought Overly Inflated Fees And Costs, With Fees Not Allowable Because They Did Not Relate To Construction Performance Under B&P § 1029.8.

            In a very contentious dispute between residential property owners and carpentry contractors, the trial and appellate courts in Romero v. Brocca, Case No. B316715 (2d Dist., Div. 1 Jan. 23, 2023) (unpublished) affirmed determinations that no one prevailed for purposes of an attorney’s fees award and that owners were not entitled to an award of a little over $41,000 in routine costs although they arguably did prevail for a costs award.  There was potential fee exposure for contractors because they were unlicensed so as to possibly trigger a fee award under Business & Professions Code section 1029.8.  However, the fee request by owners was properly denied because only a $6,500 down payment by them was involved, not unlicensed contractor performance relating to providing goods and services.  With respect to routine costs, owners submitted overly inflated costs requests, such that they were properly denied by the trial court in concluding the claimed costs were not reasonable or necessary for the litigation.

Reasonableness Of Fees: $102,737.50 Contractual Fees Award Over An $18,000 Dispute Was No Abuse Of Discretion

Hourly Rates Claimed By L.A. Attorneys Were Reasonable.

            What is the price for plaintiff losing a dispute on an $18,000 EDD payment worth against a defendant who prevailed on this issue in civil litigation?  The answer was provided in Golden Noodles, Inc. v. Souk, Case Nos. B322781/B327031 (2d Dist., Div. 4 Jan. 18, 2024) (unpublished).  Ta da!—the answer is $102,737.50 was a proper fee award for L.A. attorneys, a 40-year-plus attorney charging $350 per hour and a 10 year second attorney charging $100 per hour, attorneys winning the case for the defendant.

Consumer Statutes, Reasonableness Of Fees: Plaintiff Accepting CCP § 998 Settlement Offer In Lemon Law Case Was Properly Awarded Drastically Reduced Attorney’s Fees Where Inflated Billings Were Demonstrated

Higher Claimed Hourly Rates For Riverside Attorneys Properly Reduced, As Well As Inflated Work Effort Requests.

            In contrast to the Edmundson decision which we recently posted on, the 4/3 DCA did affirm a substantially reduced fee award under a lemon law case in Jacobs v. American Honda Motor Co., Inc., Case No. G062739 (4^th Dist., Div. 3 Dec. 8, 2023) (unpublished), with the facts and record being much different in degree.  Jacobs involved a substantial fee request after a CCP § 998 offer was accepted in a non-complex, not hugely contested litigation matter.  Given those facts and the fee “ask,” there are differences which led to a drastic cut in the fees, a determination affirmed by our local appellate court in an opinion authored by Justice Motoike.

            What happened in this case is that defendant in a Song-Beverly Act case, which has a fee shifting statute favoring the car purchaser, made a CCP § 998 offer including a component allowing attorney’s fees to be determined by the lower court (the base offer on the merits was $38,751.06).  Plaintiff accepted that offer, prompting his attorneys to file a fee request for $319,138.50 by the lead attorney and $23,530 by a secondary attorney, with the lead attorney claiming $675 per hour and secondary attorney claiming $650 per hour for a Riverside-venued matter.  The Riverside trial judge set $450 as the reasonable hourly rate for Riverside counsel, but he found lead attorney’s lodestar request was “grossly inflated” based on vague block billing and vague time entries in a routine case which did not involve a lot of pre-trial activity.   In the end, his fee request was reduced to $5,895 but the secondary attorney was granted total work effort but diminished by the lower hourly rate.

            The appellate court affirmed.  The hourly rate determinations were sustained based on the venue and the lower court’s observation of the work effort by plaintiff’s attorneys.  With respect to the big haircut for lead counsel’s fees, that was no abuse of discretion because the bad billing practices by counsel made it difficult to cipher reasonable work effort, resulting in a fee award which is substantially reduced or denied in entirety.  (In re Marriage of Nassimi, 3 Cal.App.5^th 667, 695-696 (2016).)

Laffey Matrix, Lodestar, Reasonableness Of Fees: Lower Court Erred By Too Drastically Cutting Prevailing Party Contractual Fee Request From Around $700,000 To $198,445

Lower Court Did Not Support Reduced Hourly Rate And Substantial Time Cuts.

Free haircut on Saturday morning in W.M. Scott's general store. Farrington. Chatham County, North Carolina. Library of Congress. Marion Post Wolcott, photographer.  September 1940.

            Based on the Ninth Circuit’s Moreno decision which we have cited many times, federal courts in California need to support cuts over 10% with detailed reasoning.  However, California state courts do not have the same strictness in issuing fee awards because no statement of decision is required.  However, that does not mean that an appellate court will not reverse a reduced fee award where the panel perceives those certain cuts, in hourly rates and time requested, are unfairly slashed.   Edmundson v. Bonilla, Case Nos. G062039 et al. (4^th Dist., Div. 3 Dec. 7, 2023) (unpublished) is just that situation, authored by Justice Sanchez.

            In Edmundson, after fee entitlement was sustained by the appellate court (construing written documents and oral agreements together as an integrated whole), the lower court reduced the requested $700,000 in fees to $198,445, a significant cut based on reductions in claiming attorney’s hourly rate (only allowing $345 in Orange County) and for time claimed (mainly for block billing, duplicative work, and work that was not used such as unfiled in limine motions).  The appellate court reversed and remanded.

            The 4/3 DCA panel decided that the “haircut” in fees was too much and an abuse of discretion—“[b]ut a haircut was in order, not a decapitation” even under a deferential review standard relating to amount of fees awarded.  With respect to the $345 hourly rate awarded to counsel, that was too low based on the Laffey Matrix and other evidence which showed this was a lower rate charged to the client, rather than the true market rate applicable under a lodestar analysis.  On the time reduction—which varied between 34-54.3% depending on what numbers you used—this, too, was excessive according to the reviewing court.  The block billed entries were not truly block billed, except for minor ones.  It was error to not allow billing for some unfiled tasks given that some “dead ends” are compensable, citing Vargas v. Howell, 949 F.3d 1188, 1194, 1198 (9^th Cir. 2020).  The lower court did reasonably reduce for excessive number of inter-conferencing sessions and emails.  Not to be forgotten was that plaintiffs’ attorney obtained a compensatory award of $980,988.83 in a challenging case, which reinforced why a “richer” fee award was in order. 

Construction, Laffey Matrix, Lodestar, Reasonableness Of Fees: Los Angeles County Superior Court Awards A Little Over $1.3 Million In Fees And About $82,000 In Costs In Construction Dispute With Contractual Fees Clause Entitlement

Decision Provides Insights Into Judicial Resolution Of Contested Fee And Costs Issues.

            Because there has not been a lot of fee or costs decisions in the last couple of weeks, we report on a Los Angeles County Superior Court (Norwalk) final ruling on attorney’s fees and costs to a prevailing plaintiff in WnG Construction JV, Inc. v. AAA Solar Electric, Inc., et al., L.A. Superior Court Case No. VC065473 [Judge Porras]. 

            Plaintiff WnG won a construction dispute with a contractual fees clause against the defense, winning compensatory damages of about $3.116 million (inclusive of prejudgment interest) despite an offset and plaintiff not winning all that it wanted.  However, given that plaintiff did gain much of what it wanted, plaintiff was the prevailing party under the fees clause.  Plaintiff then moved for fees and costs, with various law firms submitting fee requests totaling around $2.1 million and with costs claimed of over $205,000.

            After some reductions on both counts, Judge Porras awarded fees of about $1.309 million and costs of around $82,000.

            Here are some interesting highlights to show his thinking on awarding reasonable fees and costs:

• • • An attorney disqualified based on ethical obligation violations is not entitled to any fees, an almost $223,000 reduction;
    • A law firm requesting over $653,000 in fees did not get them because they were involved in a discovery dispute which showed plaintiff deliberately spoliated evidence;
    • The principal law firm did get a majority of its requested fees, although J.D. law clerk/non-J.D. law clerk/secretarial work was not allowed and the main attorney charging $500 per hour for a breach of contract case was reasonable (but not an enhanced $750 hourly rate based on the Laffey Matrix, which the lower court found did not reflect L.A. County rates);
    • A law firm billing for potential post-trial/appellate consultation was not entitled to fees until those events materialized into situations allowing for fee recovery;
    • Although a CCP § 998 offer was rejected and could have potentially resulted in expert fee recoupment (although it is not clear from the record), the failure to identify pre-offer versus post-offer costs did not allow for an award of expert fees without a clearer allocation;
    • Charges for additional or duplicate copies of court reporter transcripts resulted in a reduction of expenses for these items.

            With that said, we give a “shout out” to Thomas F. Nowland, whose law firm and whose principal work led to him receiving a substantial portion of his fees on behalf of his client.  We thank him for providing the fee and costs ruling in this case so it could be shared with you.

Reasonableness Of Fees: Over $1.2 Million In Fees To Prevailing Party Was No Abuse Of Discretion

Lower Court Already Reduced Fee Request; This Initial Reduction Did Not Lead To The Conclusions That A Denial In Entirety Of Fees Or Further Reductions Were Required.

            Plaintiff prevailed in a contractual breach claim against a municipality in Air Combat USA v. City of Fullerton, Case Nos. G059914 et al. (4^th Dist., Div. 3 June 29,2023) (unpublished), being awarded $1.2 million in compensatory damages although that was pared down significantly by the lower court through post-trial motions.  However, the lower court granted plaintiff $1,229,520 in attorney’s fees.  City did not alter that result on appeal.  The trial judge did make reductions from plaintiff’s request, with the argument that such a reduction supported a complete denial or further reductions ignoring the abuse of discretion standard relating to the amount of fee awards.  Justice Goethals authored the 3-0 opinion.

Reasonableness Of Fees: $1.11 Million Fee Award To Two Prevailing Defendants, As Against Lloyd’s, Was Found To Be No Abuse Of Discretion

Lower Court Reduced Defendants’ Fee Requests By Over $457,720.

            Challenging the amount of an attorney’s fees award as an abuse of discretion is a daunting task, given it must be shown the award was irrational or that it shocks a jurist’s conscience.  Appellant could not satisfy this tough standard in Certain Underwriters at Lloyd’s, etc. v. Zillow Group, Case Nos. A164516 et al. (1^st Dist., Div. 4 June 28, 2023) (unpublished).

            There, Underwriters lost a summary judgment motion against two defendants in an indemnity suit featuring enterprise service agreements with fee clauses.  The lower court awarded one defendant $460,000 in fees (a $228,860.28 reduction from the ask) and another defendant $650,000 in fees (applying even a steeper reduction than the haircut given to the first defendant’s ask).

            The appellate court disagreed with Lloyd’s’ argument that the awards were an abuse of trial court discretion.  The second defendant did additional work than the first defendant, which justified the disparate amounts of the two awards.  Also not to be forgotten was the significant haircut – over $457,720 – made by the lower court in making its awards.

Laffey Matrix, Probate, Reasonableness Of Fees: Probate Court Properly Lowered Requested Attorney’s Fees For Trust Work Based On Its Knowledge And Experience

Lower Court Did Not Have to Credit The Laffey Matrix.

            Melbostad v. Kasales, Case No. A165361 (1^st Dist., Div. 3 June 16, 2023) (unpublished) demonstrates how, in California state court cases, a trial court is able to draw upon its own knowledge and experience in determining a reasonable lodestar hourly rate and in determining the reasonableness of overall fees to be awarded.

            What happened in this matter was that an attorney providing both trustee and attorney fee work waived any compensation for trustee work under Probate Code section 15687(b), claiming entitlement for $163,061.82 in attorney’s fees work for a trust.  The lower court, based on its knowledge and experience in the area, reduced the claimed $525 hourly rate to $465 and found a substantial portion of the requested hours related to waived trustee compensation, such that $48,681 should be the fee award. 

            The appellate court affirmed.  Appellant’s argument that trustee’s compensation factors should be applied to a trust attorney’s fee compensation determination was unsupported by authority.  With respect to the hourly rate, the lower court did not have to follow the Laffey Matrix rates but, instead, could rely on its knowledge and experience of what a reasonable hourly rate should be in the probate area.

Reasonableness Of Fees: $113,745 Fee Award Remanded Because It Was Unclear If Trial Court Might Have Allowed A “Double Dip” On Fees Based On Prior Discovery Motion Rulings

$10,200 Potential Difference Necessitated A Remand, Not On Appellate Modification Based On Uncertainty In The Lower Court’s Ruling.

            In Fuentes v. Betuel, Case No. B302827 (2d Dist., Div. 3 May 19, 2023) (unpublished), prevailing defendants moved to recover attorney’s fees of $128,860, with the lower court making some reductions—including adjustments to prevent a “double dip” on prior awards of fees in discovery battles—in coming to an eventual award of $113,745.  Except for one aspect of the award, the result held up on appeal.  However, the appellate court was unclear on whether the lower court maybe did “double dip” about $10,200 on the discovery issue.  Rather than modify the judgment downward, the Court of Appeal remanded so the trial judge could revisit the issue, without indicating how the lower court should rule. 

Arbitration, Prevailing Party, Reasonableness Of Fees: Client Who Reversed Post-MFAA De Novo Trial Results And Who Confirmed The Prior Arbitration Award Was The Prevailing Party

Because Client Had To Hire Appellate Attorneys Reversing The De Novo Trial Results, Client Was Awarded $334,458.11 In Fees/Costs—Affirmed By The Appellate Court.

            Soni v. Cartograph, Inc., Case No. B316270 (2d Dist., Div. 5 Mar. 23, 2023) (unpublished) is quite a megillah of an arbitration/litigation odyssey about a client-attorney dispute over fees.  Looks like the odyssey has finally come to a close.

            Although the overall alleged fee delinquency was relatively small, client took attorney through a mandatory fee arbitration proceeding under the Mandatory Fee Arbitration Act (MFAA), resulting in a net award of $2.50 to attorney.  Thirty-three days after service of the arbitration award, attorney filed a civil action against client seeking about $27,500.  Attorney won that litigation, although only obtaining a $2,890 judgment, plus interest as well as fees and costs to be determined.  Attorney requested $281,191.65 in contractual fees, with the lower court awarding $79,898.  However, client appealed the judgment, and it was reversed on appeal because attorney failed to file its action within a 30-day deadline period, reversing a denial of client’s motion to confirm the award. 

            Upon remand, the lower court granted client’s petition to confirm the arbitration award.  Both sides claimed to be prevailing parties, filing dueling fee motions.  The trial judge found that client prevailed, awarding client $328,166.50 in fees under the MFAA, Business and Professions Code sections 6203 and 6204.

            Attorney was miffed, appealing but obtaining no change in result.  Client was the prevailing party under section 6203(c) because client successfully confirmed the arbitration award, notwithstanding the tortured history by which client finally got to this final reckoning.  The appellate panel also rejected the argument that the language of the contractual fees provision governed, because the MFAA controlled over the parties’ contract provision.  Finally, the amount of the award was no abuse of discretion, given appellate expertise was necessary and given client’s attorneys worked half as many hours as attorney’s attorneys.

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.

Reasonableness Of Fees: When Trial Judge Gives You A Supplemental Chance To Explain Fees And Allocate Them, Take The Judge Up On It Or Face Reductions Which You Will Not Like

Defendants Requested $191,007.50 In Fees, But Were Only Awarded $74,424.71 Based On Their Failure To Provide The Trial Judge With Adequate Supplemental Information.

            Mooney v. Argus Realty Investors, Case No. G060440 (4^th Dist., Div. 3 Feb. 2, 2023) (unpublished) is a stark reminder that a fee claimant needs to pay special attention to a trial judge’s request for supplemental information, especially the need to allocate between non-compensable or unsuccessful claims.  The fee claimant in this one ignored a trial judge’s request for supplemental information on billings and suggested allocations between compensable contract/non-compensable tort claims.  That was not good for the fee claimant:  the lower court reduced the total $184,435 billed fee request down to $135,704.42 for inefficiencies/excessive time; it then reduced that smaller total in half; and then added back in $6,572.50 in unbilled time, for a total award of $74,424.71.  Because the prevailing parties failed to raise any argument against apportionment and failed to respond to major supplemental requests by the lower court, the reduced award was no abuse of discretion.  Presiding Justice O’Leary authored the 3-0 opinion. 

Landlord/Tenant, Reasonableness Of Fees: $358,133.56 In Fees Against Tenant Operating Two Illegal Marijuana Dispensaries Affirmed On Appeal

Two Law Firms’ Requests Were Largely Sustained By Reviewing Court.

            City of Santa Ana v. Yuh, Case No. G060889 (4^th Dist., Div. 3 Jan. 24, 2023) (unpublished) was a situation where a tenant lost an abatement action against the City of Santa Ana for operating two illegal marijuana dispensaries.  Two firms representing the City moved for attorneys’ fees, with the trial judge—after some reductions—awarding $358,133.56 against tenant.  In an opinion authored by Justice Sanchez, the fee awards were confirmed because the tenant did not specify objections to the fee requests.  After all, the trial judge did make some reductions.  This is yet another opinion showing the potential “bite” of fee exposure to tenants in these types of disputes. 

Fee Clause Interpretation, Homeowner Associations, Reasonableness Of Fees: $132,070.40 Fee Award To Defendant Homeowners Was Affirmed On Appeal As Against Plaintiff Homeowners In Tree Obstruction Dispute

Plaintiffs Pled CC&Rs As A Basis For Nuisance Claim, So There Was Fee Entitlement Under Civil Code Section 1717, CCP Section 1021, And Civil Code Section 5975, With The Fee Award Being Reasonable After A Minor Haircut By The Trial Judge.

            Plaintiff homeowners sued neighboring homeowners in a tree obstruction action based on nuisance and defendants’ alleged violation of certain specified CC&Rs.  After everyone attended an unsuccessful mediation, the matter proceeded to trial and was decided in defendants’ favor.  The trial judge later awarded defendants, as against plaintiffs, attorney’s fees of $132,070.40 (reduced from the $143,381.76 “ask”). 

            Plaintiffs’ appeal in Mascaro v. Brown, Case No. B319419 (2d Dist., Div. 6 Jan. 19, 2023) (unpublished) was unsuccessful.  Although challenging fee entitlement, plaintiffs’ nuisance action was also based on CC&Rs, such that fee entitlement existed under Civil Code section 1717 (based on the CC&Rs fees provision), CCP section 1021 (same; broad CC&Rs fee provision), and Civil Code section 5975 (Davis-Stirling Act fee-shifting provision applicable where governing HOA documents are being enforced).  The fees for mediation work were allowable under section 5975(c) regardless of the CC&Rs’ specific language.  With respect to the amount of the fees awarded, the trial judge did not abuse his discretion given that there was competent fee substantiation in the form of invoices and the lower court did reduce some duplicative, unnecessary work.  Finally, the appellate court agreed that the defendants were also entitled to reasonable appellate fees for their win in the appeal.

Reasonableness Of Fees: 45% Reduction In Mainly Appellate Fees Was Affirmed On Appeal

Aggrieved Party, Despite Significant Reduction, Appealed To No Avail.

            We understand that no one likes to be hit with a significant fee award.  However, when you get a significant reduction, think carefully about whether you want to appeal.  That was the moral of CDC San Francisco LLC v. Webcor Construction, L.P., Case No. A163751 (1^st Dist., Div. 1 Jan. 11, 2023) (unpublished).

            What happened here was that plaintiff/appellant was hit with an adverse fee award of $855,438 after an unsuccessful appeal in a case where there was a contractual fees clause even though the prevailing parties sought $1,555,342 in fees.  The award was a lower court reduction of 45% from the requested fees, after finding that appellate counsel’s hourly rates were excessive, and the hours claimed were grossly inflated in an appeal which was not a “bet-the-company” case.  Plaintiff thought more should be reduced, but that did not occur on appeal.

            Plaintiff wanted heightened scrutiny of the trial court’s reasoning under Kerkeles v. City of San Jose, 243 Cal.App.4^th 88 (2015), but that was a federal civil rights case that was not congruent with California state law.  Plaintiff then argued that the award was over ten times the amount awarded to trial counsel for fee work, but the appellate court rejected this argument because appellate work is more specialized, and plaintiff did not provide the amount of time/rates that its counsel charged for appellate work on a comparative level.  The significant lower court reduction took the sting out of the argument that the fee award was too shocking in nature. 

Lodestar, Reasonableness Of Fees: Fee Award Of $700,000 To HOA In Uncomplicated Homeowner Dispute Was Reversed And Remanded

Record Was Unclear Whether The Lower Court Utilized The Proper Lodestar Reduction Factors For Over-Conferencing, Duplication, Over-Staffing, And Results Obtained.

            Ladera Ranch Maintenance Corp. v. Tinsley, Case No. G060730 (4^th Dist., Div. 3 Jan. 9, 2023) (unpublished) is must reading for practitioners and jurists on salient factors that a party opposing a fee request and a trial judge assessing the same should focus in on for purposes of examining a substantial fee request in a relatively uncomplicated case.

            In this one, homeowners did lose an HOA dispute involving community standards for a large tarp they erected adjacent to their home, failure to replace two trees they removed from their yard, and removal of an entryway chain, as well as lost a cross-complaint against the HOA for trash can, noise/parking, and prank-playing child issues.  HOA then moved to recover attorney’s fees for “a breathtaking number approaching $700,000 ($699,598.72).”  The lower court made some minor haircuts for over-conferencing, pre-litigation activities, unconnected matters, and insurance appointed counsel coordination, awarding HOA a total of $585,067.30.  The trial judge also did note the submitted billings showed duplication, unnecessary work, nonchronological entries, billing for tasks which could have been performed by paralegals, and excessive conferencing with HOA’s corporate counsel. 

            The 4/3 DCA, in an opinion authored by Justice Goethals, reversed and remanded for a re-do.  The appellate court was concerned that the lower court abused its discretion by not looking at the bigger picture which showed significant amounts of over-conferencing by six lawyers over uncomplicated issues—well over one-half of a billable year on just the HOA’s complaint, not to mention significant time which could have done by a paralegal and significant over-staffing.  Nothing indicated that the court looked for task padding, attorney stacking, or inflated billing in other areas but over-conferencing.  Beyond that, the fee award must be reasonable in relation to the results obtained.  The record showed that the lower court failed to assess the fee request with factors which would be used when a request is “manifestly excessive.”  A remand was necessary so that the trial judge could restudy the fee request and amplify on his reasoning as for as the ultimate fee awarded.

Prevailing Party, Reasonableness Of Fees, Section 1717: $200,000 Fee Award To Prevailing Defendant Affirmed Because Tort Claims Allowed For Recovery, Post-Dismissal, Under Santisas

Settlement With Other Parties Did Not Impact Analysis Of Fee Reasonableness As To The Prevailing Defendant.

            Carp Property, LLC v. Corona, Case No. B316354 (2d Dist., Div. 6 Nov. 17, 2022) (unpublished) was a situation where plaintiff litigated a matter for two years where there was a contractual fees clause in an operative agreement, suing for over $2.1 million.  Plaintiff settled with some defendants for a total of $90,000 and then dismissed the prevailing defendant after that party rejected a “walkaway” settlement in exchange for a waiver of costs.  Prevailing defendant moved for $228,000 in Civil Code section 1717 fees, but the lower court awarded $200,000 after trimming the request for block billing and for higher-level attorneys performing lower level tasks.

            The appellate court affirmed the fee award.  Plaintiff dismissed both contract and tort claims, but the dismissed tort claims were inextricably intertwined with the contract claims and the broadly worded attorney’s fees provision allowed for tort claim recovery, an exception to the Santisas v. Goodin, 17 Cal.4^th 599, 621 (1998) “general rule” relating to dismissal of contractual claims.  It then found that the $90,000 settlement with some defendants did determine fee reasonableness as far as the work done by the other prevailing defendant here.  The trial court also trimmed about $28,000 from the fee request, such that some of plaintiff’s arguments for a reduction were credited—meaning the fee award was no abuse of discretion and did not shock the conscience. 

Reasonableness Of Fees: Plaintiffs Denied Contractual Fees Altogether Did Not Adequately Address All Reasons For Denial In Their Appellants’ Opening Brief

Responding To Some More Of The Defense Arguments In The Reply Brief Was Too Late.

            In GI Excellence, Inc. v. Padda, Case No. E076843 (4^th Dist., Div. 2 Nov. 7, 2022) (unpublished), plaintiffs won around $65,000 in compensatory damages and then moved to recover $755,300 in contractual attorney’s fees.  The lower court denied the request in entirety.  On appeal, plaintiffs did not address all of the defense arguments below as far as why the fee request should be denied in their opening appellants’ brief.  Although they did get to some more of the defense arguments in their reply brief, this was too late— “a day late and a dollar short,” as colorfully put by the appellate court in affirming the fee denial.

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.

Reasonableness Of Fees: Failure To Provide Adequate Record Led To Affirmance Of $365,455.02 Fee Award To Defendants

Lengthy Litigation Can Lead To Large Fee Awards, Which Require An Adequate Record To Challenge.

            The moral from Westpark Village, et al. v. Khanna, Case No. A164667 (1^st Dist., Div. 2 Sept. 28, 2022) (unpublished), which involved a contractual fee award of $365,495.02 against defendants after years of litigation, is simple—make sure you have an adequate appellate record when you challenge such an award.  Here, defendants only put their fee opposition papers; failure to provide the moving paperwork was fatal. 

Landlord/Tenant, Reasonableness Of Fees: $684,000 Fee Award In Favor Of Tenants And Against Landlord Reversed And Remanded

Appellate Court Did Not Buy That Trial Court Could Just Adopt Plaintiffs’ Voluntary Reduction Without Addressing Other Objections.

            We posted today about a published decision between the parties.  Separately, Sarkany v. West, Case No. A161728 (1^st Dist., Div. 2 Aug. 30, 2022) (unpublished) was landlords’ appeal from an adverse $684,000 attorney’s fees award in favor of tenants after a favorable jury verdict, with the fee entitlement not being contested.  Without much of an explanation, plaintiffs reduced their $1.134 million fee request (inclusive of a 1.5 multiplier) by $141,245.50.  The trial court bought it, awarding a little over $684,000 to plaintiffs on the lodestar request, but denying a positive multiplier. The appellate court did not buy it.  The voluntary reduction did not address the defense objections to the fee motion, much less the trial judge’s concerns that a reduction might be justified based on plaintiffs’ sanctionable and litigious conduct.  It simply could not determine that these factors were considered, so a re-do was ordered.  One of the defendants argued no fee award was justified based on indigency, but the appellate court could only find this was a consideration for a plaintiff’s indigency, not a defendant’s indigency.  (Garcia v. Santana, 174 Cal.App.4^th 464, 476 (2009).)