CALIFORNIA ATTORNEY'S FEES

In The News . . . . California Lemon Law Cases Are On The Rise At The State Trial Court Level

Orange County Register OpEd Piece Thinks Attorney’s Fees For Plaintiffs Is The Motivating Cause.

               Although we are not endorsing OpEd views in this blog, we will report on ones which have their own take on issues which the writers believe implicate attorney’s fees issues.

               The Sunday, July 28, 2024 edition of The Orange County Register has an OpEd piece authored by Kyla Christoffersen Powell, who reported that California “lemon law” cases in 2023 surged to a total of 22,655 cases filed statewide, a 52% increase from the previous year.  She reports that the situation is acute in Los Angeles County, where lemon law cases spiked 1,400% in branch courts between 2021 and 2023—with two Los Angeles County Superior Court judges reporting that they had total dockets in excess of 760 cases.  She also reports that, in 2023, just seven law firms filed 54% of all lemon law cases in the state, with the most prolific firms increasing their filings almost 75% between 2022 and 2023.  Ms. Powell believes the dramatic increase is due to the pro-plaintiff fee shifting provisions of the Song-Beverly Act.  She makes some suggestions for reforms, such as a pre-lawsuit notice, capping of fees, and wider use of an arbitration protocol potentially available in these types of disputes.

               She ends by quoting Judge Timothy Taylor of the San Diego County Superior Court, who noted that certain attorneys are “emboldened to over-litigate cases the manufacturers regularly seek to settle, with no benefit to the injured consumer.”

In The News: Epic Games Mounts Substantial Opposition To Apple’s $73.4 Million Fee Reimbursement Request For Apple’s Prevailing On Antitrust Claims And “Largely Uncontested” Contractual Breach Claims

Epic Games Claims Antitrust Fees Not Recoverable, Contractual Breach Claims Not Segregated So As To Be Recoverable, And “Fees On Fees” Not Recoverable Due To A Failure To Meet And Confer Before Filing Of The Substantial Fee Request.

            In Epic Games, Inc. v. Apple Inc., Case No. 4-20-CV-05640-YGR-TSH (N.D. Cal., Doc. No 886, dated Feb. 16, 2023), Epic Games is pushing back at a $73.4 million fee reimbursement request by Apple after Epic Games did not prevail on certain antitrust and breach of contract claims.  First, Epic Games argues that fees incurred by Apple in the defense of antitrust claims are precluded altogether by Carver v. Chevron U.S.A., Inc., 119 Cal.App.4^th 498 (2004), which has been applied to federal antitrust claims says Epic Games in its opposition arguments.  Second, fees for a “largely uncontested” contractual breach claim were not recoverable because Apple did not attempt to segregate the fees from those which were incurred on the antitrust claim.  Third, “fees on fees”—the work on the fees motion—were not recoverable because Apple did not meet and confer on the fee motion before it was filed.

In The News . . . . Wells Fargo’s Legal Specialty Group Shows Big U.S. Law Firm Raised Billable Hourly Rates By 8.3% In 2023

That Factor, Combined With Holding Down Expenses, Led To More Profits Also.

            Wells Fargo’s Legal Specialty Group, after surveying more than 130 U.S. big firms inclusive of 70 of the top 100 highest grossing U.S. firms, has reported that for 2023, these firms increased billable hourly rates by 8.3% over 2022 rates.  That led to increased profits for these firms in 2023, on average.

In The News: Bloomberg’s Attorney Workload and Hourly Survey For First Half Of 2023 Has Some Interesting Findings For Law Professionals

Burn-Out Felt By Almost Half Of Survey Respondents.

            Based on a survey of law professionals (78% from law firms), Bloomberg has issued its Attorney Workload and Hourly Survey for the 1^st and 2^nd Quarters of 2023.  Here is a summary of some findings which we found interesting:

• • • The average hours worked were 48 per week, versus 37 average hours billed.
    • 47% of respondents were satisfied with their jobs, 38% were neutral, and 15% were unsatisfied.
    • Lawyers felt burnt out 48% of the time.
    • Disrupted sleep and anxiety were the two largest negative repercussions associated with lawyers’ jobs.
    • 72% of respondents used exercise as self-care protection during off time.
    • With respect to main tasks completed by lawyers, they broke down this way: litigators—72% did case analysis; transactional attorneys—46% engaged in direct client communications; and regulatory and compliance attorneys—93% performed regulatory compliance.

In The News, SLAPP: Maxine Waters’ SLAPP Grant And Fees Recovery Reversed On Appeal

This Updates Our Prior May 28, 2021 Post On The Case At The Trial Level.

            On May 28, 2021, we did a post on a trial court fee award in a defamation action brought by Joe E. Collins III against Maxine Waters, congressional seat opponents in the past, where a Los Angeles County Superior Court judge granted Ms. Waters’ SLAPP motion and awarded her $53,590 prevailing party attorney’s fees.  We now have an update for you.  On June 5, 2023, the 2/8 DCA reversed the SLAPP grant in the defamation case brought by Mr. Collins, which also means the fee award was vacated on appeal.  The case is Collins v. Waters, Case No. B312937 (2d Dist., Div. 8 June 5, 2023) (published). 

In The News . . . . Bloomberg Law’s Workload And Hours Second Half 2022 Survey Results Has Some Interesting Data Points

Job Satisfaction Is Less Than Half; Minimum Billing Requirements Are Still Prevalent; And Hybrid Working Is Still In Vogue.

            Based on a survey of 868 attorneys (85% of which were at law firms), Bloomberg Law has released its Workload and Hours H2 2022 survey.  Here are the highlights from the survey:

• • Average hours worked per week = 49 hours; average hours billed = 39 hours.
  • Only 47% of lawyers felt satisfied with their jobs, with many suffering from numerous stress symptoms (disrupted sleep being the most predominant symptom).
  • Weekly exercise was the largest self-care activity utilized by lawyers.
  • 65% of respondents had minimum hourly billing quotas, with the average billable hours required being 1745 years per year, and with the responding attorneys actually billing 1799 hours per year.
  • The average number of non-billable hours for lawyers during the second half of 2022 was 233 hours.
  • 64% of respondents indicated that they were working hybrid, both in the office and remotely, not unexpected based on how the pandemic altered work life.

In The News . . . . 2022-2023 Judicial Hellholes Report Has California Ranked Number 3, Behind Georgia And The Pennsylvania Supreme Court/Philadelphia Court Of Common Pleas

Proposition 65, No-Injury Food and Beverage Class Actions, PAGA, ADA, Lemon Law, Climate Change Litigation, and COVID-19 Liability Issues Were the Illustrative Matters Leading To California’s Ranking.

            The American Tort Reform Foundation’s 2022-2023 Judicial Hellholes Report is out, in which it ranks California #3, preceded by #1 Georgia and #2 Pennsylvania Supreme Court/Philadelphia Court of Common Pleas as “judicial hellholes.”  Here are the types of litigation which led to the #3 ranking:

• • Proposition 65 Litigation – the report noted a 251% rise in these cases between 2012-2021.
  • No-injury food and beverage consumer class actions – the report observes, based on a survey by Jones Day, that in 2019 and 2020, class counsel in these cases, on average, received 10% more than the class members they represented.
  • PAGA – the interesting development here is that in November 2024, California voters have a ballot initiative to consider by which PAGA would be replaced by a Labor Commissioner complaint process.
  • ADA accessibility lawsuits – California is home to more than 50% of the total accessibility cases nationwide, with website accessibility filings jumping more than 3,000% since 2018.
  • Lemon Law cases—the report says that between 2018-2021, 34,397 suits of this sort were filed in California state courts.
  • Climate change litigation – the report suggests the results are mixed in this area.
  • COVID-19 liability cases – the California Supreme Court will consider at least one liability situation where a wife of a husband who caught COVID-19 at a construction site is bringing a liability claim.

            The full report is publicly available on the Internet, containing specific cases and rulings by jurists in these areas, plus plaintiffs/law firms involved in these matters and even more statistics.

In The News . . . . Wells Fargo’s Legal Specialty Group Predicts That U.S. Firms Will Increase Pre-Discounted Hourly Rates By 7-8% Next Year

2022 Rates Were Lower Because Of Discounts And Increased Write-Offs.

            U.S. law firm leaders informed Wells Fargo Legal Specialty Group that their firms will increase hourly rates by an average of 7-8% in 2023, before discounting.  For 2022, rates were lower because of bigger discounts and increased write-offs.

In The News: Retired Justice Richard D. Fybel Recently Passed Away

He Had A Distinguished Legal And Judicial Career, Along With Writing On Important Subjects.

            It is with sadness that we report that Retired Justice Richard D. Fybel recently passed away.  He had a distinguished career at Morrison & Foerster LLP, was on the Orange County Superior Court bench for around 2 years, and then had a 20-year tenure with the California Court of Appeal, Fourth District, Division 3 as an Associate Justice.  He was president of University Synagogue in Irvine for two years, writing prolifically on judicial ethics and the Holocaust.  Co-contributors Mike and Marc argued before him on several cases while he sat on the 4/3 DCA.  Our condolences go out to his family and friends; he was a superb jurist and gentleman.

In The News . . . Bloomberg Law’s Most Recent Workload & Hours Survey Suggests That Practitioners 45 Years And Older Have More Non-Billable Hours Than Younger Lawyers

Reasons For This Are Not Clear.

            Based on Bloomberg Law’s Workload and Hours survey, conducted from July 27, 2022 – August 19,2022, survey respondents in the 25-34, 35-44, 45-54, 55,64, and 65+ age groups reported on the number of yearly non-billable hours they worked.  Here are the totals, and no real reason emerged for the results:  149 hours for the 25-34 year group; 195 hours for the 35-44 age group; 278 hours for the 45-54 years old group; 240 hours for the 55-64 category; and 193 hours for 65+ years attorneys. 

IN THE NEWS: Plaintiffs’ Florida Condominium Collapse Attorneys Awarded $70 Million-Plus In Attorney’s Fees

$1.1 Billion Settlement Was At Issue.

            We can report that a Miami-Dade Circuit Judge recently awarded plaintiffs’ counsel in the Florida condominium collapse case about $70 million-plus in attorney’s fees. They had requested $100 million in a case producing a $1.1 billion settlement paid for about 37 sources (including insurance carriers).

In The News . . . . Plaintiff Winning About $309,500 In Damages Against Amazon In Disparate Treatment Accommodation Case Garners Fee Award Of $2.47 Million

She Asked For $3.46 Million In Fees.

            Even though not winning all of her claims against Amazon, a female employee who won a disparate treatment claim based on pregnancy accommodation issues to the tune of about $309,500 in damages also requested a fees award of $3.46 million as prevailing party.  The trial court agreed she prevailed, awarding her $2.47 million in fees.  The result goes to show you how game changing a fee-shifting statute or contract can be in litigation. 

In The News: Mike and Marc Are Interviewed On The Subject Of Attorney's Fees

California Appellate Law Podcast.

        Because we have published our attorney's fees blog since 2008, Mike and Marc were recently interviewed by Tim Kowal and Jeff Lewis, the creators of the California Appellate Law Podcast. Thanks, Tim and Jeff for the opportunity to speak about attorney's fees. Our interview is the 28th episode of their excellent podcast. Here is a link to the interview.

In The News . . . . Facebook And Gibson Dunn Are Being Targeted For Discovery Sanctions Of Over $854,000 In Privacy Class Action In Northern California

Motion Has Been Filed And Unsealed, With Opposition Due In The Future.

            Just to show you how civil discovery is a financially draining part of litigation and is also the source of substantial sanctions motion for delay, one only needs to look at a motion filed by Plaintiffs in a privacy class action against Facebook (Meta)—In re Facebook Inc. Privacy User Litig., Case No. 18-md-02843-VC-JSC (N.D. Cal. Apr. 1, 2022) (Doc. No. 907-5) [previously sealed and now unsealed].  Based on comments at a prior hearing by the district judge presiding over the case, Plaintiffs are seeking $854,195.72 is discovery sanctions against Facebook and its counsel Gibson Dunn.  No opposition has yet been filed, but it would be ironic if the defense wants more time given the district judge’s earlier comments chastised them for delays in producing information.  We shall see!

Employment, In The News . . . . Attorney’s Fees Average More Than $405,000 Per Case And Average Settlement Is $1.2 Million In PAGA Cases

A Recent Study By CABIA So Concludes.

            Under the Private Attorneys General Act (PAGA), prevailing plaintiffs can obtain attorney’s fees for success on certain employment and workplace claims.  As reported in an OpEd article “Help business recovery, end PAGA” written by Ken Monroe in the July 18, 2021 edition of The Orange County Register, a recent study by the California Business and Industrial Alliance (CABIA) demonstrates that since creation of the law, attorney’s fees average more than $405,000 per case and the average settlement in such cases with PAGA claims is $1.2 million. 

Employment, In The News . . . . Attorney’s Fees Average More Than $405,000 Per Case And Average Settlement Is $1.2 Million In PAGA Cases

A Recent Study By CABIA So Concludes.

            Under the Private Attorneys General Act (PAGA), prevailing plaintiffs can obtain attorney’s fees for success on certain employment and workplace claims.  As reported in an OpEd article “Help business recovery, end PAGA” written by Ken Monroe in the July 18, 2021 edition of The Orange County Register, a recent study by the California Business and Industrial Alliance (CABIA) demonstrates that since creation of the law, attorney’s fees average more than $405,000 per case and the average settlement in such cases with PAGA claims is $1.2 million. 

In the News, SLAPP: Rep. Maxine Waters Awarded $53,590 In SLAPP Fees/Costs For Defending Herself In A Defamation Suit Against Political Foe Joe E. Collins III

SLAPP Fee/Costs Request Was Reasonable, Rejecting That Under $30,000 Should Be Awarded.

            On May 27, 2021, a Los Angeles County Superior Court judge ruled that Rep. Maxine Waters should be awarded $53,590 in attorney’s fees and costs under a mandatory SLAPP fee-shifting provision for SLAPP-ing a defamation action brought against her by political foe Joe E. Collins III, according to an on-line post by City News Service.  The judge found that Rep. Waters did not act with malice towards Mr. Collins.   The defense requested a fees/costs award of under $30,000, but the lower court found that the requested hourly rate and work effort, both, were warranted. 

In The News . . . . City Of Fullerton Approves Settlement To Pay $230,000 In Legal Fees And $60,000 To Two Bloggers In Document Dispute

First Amendment Won Out In This One.

            According to an article in the May 20, 2021 issue of The Orange County Register (online version here), Fullerton City’s Council last week voted to settle a lawsuit it filed against two bloggers for publishing certain information which the City claimed was stolen (later found out not to be so).  A lower court had issued gag orders against the bloggers, but an appellate court overturned them because they amounted to impermissible First Amendment prior restraints.  In settling the suit, the City agreed to pay $230,000 in legal fees as well as $60,000 to the two bloggers.

In The News . . . . KQED News Report Indicates That 90% Of Funds In First Year Of Operation For PG&E Fire Reimbursement To Camp Fire/Paradise Victims Went To Overhead

Much Of That Overhead Was Law Firm And Claim Administration Expenses.

            In a May 7, 2021 article in The Orange County Register, KQED News has reported that 90% the funds from a trust set up to compensate victims in the Camp/Paradise fires, in its first year of operations, was spent on overhead, including attorneys, project managers, analysts, claim reviewers, and software developers.  This trust was set up in the PG&E bankruptcy case.  A former California State Bar governor has been quoted that these charges are excessive compared to the meager compensation paid to the victims and that the trust has not been completely transparent about what it is doing for this money.  The trust paid out $7 million to victims while racking up $51 million in overhead according to the Register article.

In The News . . . . CALA Sponsored 2021 Report Finds That Tort Reform In California Would Save Residents And Businesses Nearly $25 Billion In Savings

COVID-19, PAGA, And ADA Suits Cited, With Report Finding That Each California Resident Pays A “Tort Tax” Of Over $574 Per Person.

            Citizens Against Lawsuit Abuse (CALA), based on a recent 2021 report by John Durham & Associates entitled “The Impact of Tort Costs and the Potential Economic Benefits of Tort Reform in California,” published statistical conclusions that tort reform in California could save state residents and businesses nearly $25 billion, with each state resident paying a “tort tax” of over $574 per person.  COVID-19, PAGA, and ADA cases were mentioned, with 2,700 PAGA and ADA cases filed in federal court in the first six months of 2020.  Co-contributor Mike can attest that many district judges, at early status conferences, echo seeing a flood of ADA cases, and co-contributor Marc is being kept busy as a federal mediator trying to resolve a large number of ADA matters at early stages before attorney’s fees become the stumbling block to settlements.

In The News . . . . Attorney Fired In Case Against GM Only Gets $3,052.50 In Attorney’s Fees And Zero Expenses Despite Seeking $17,270 In Fees And $4,646.97 In Expenses

Federal District Judge Said Expenses Already Reimbursed And Attorney Does Not Get Fees For Work After He Was Fired.

            As reported by Debra Cassens Weiss in the April 15, 2021 on-line ABA Journal, a federal district judge in In re General Motors LLC Ignition Switch Litig., Case No. 17-CV-9353 (JMF) (Apr. 13, 2021 order) only awarded a plaintiff’s former attorney $3,052.50 in attorney’s fees and zero expenses despite a fee request for $17,270 in fees and $4,646.97 in expenses.  District Judge Jesse M. Furman concluded no expenses should be awarded because the plaintiff’s attorney had already been reimbursed for them.  With respect to fees, this one was confounding given that many of them were incurred after the attorney was fired and the new attorney never alerted the court that the fee request related to post-firing work.  The result was to pare the request down significantly, meaning plaintiff’s former attorney should be glad he got anything at all (and did not get anything for post-firing work, filing a suit after he was fired)!

In The News, SLAPP. . . . Carlsbad Councilwoman Cori Schumacher Ordered To Pay $47,191 To Two Prevailing Defendants When Her Social Media Civil Harassment Petition Was Dismissed Via A SLAPP Motion

Earlier, She Was Ordered To Pay $2,625 In Fees To A Third Prevailing Defendant.

            Carlsbad Councilwoman Cori Schumacher, a former surfing champion, brought a civil harassment claim against Anthony Bona, Noel Breen, and Larry Posner for their outspoken criticism of her on social media.  Unfortunately, her petition was dismissed as to Mr. Posner in October 2020 and was resolved adversely by a grant of a SLAPP motion in favor of the other two gentlemen.  Mr. Posner, based on the dismissal, was declared to be the prevailing party on March 12, 2021, such that he obtained a $2,625 fees award against Ms. Schumacher (although it is unclear whether it was against her as an individual or as a councilwoman).

            On April 9, 2021, more bad news came Ms. Schumacher’s way.  San Diego County Superior Court Judge Cynthia A. Freeland (who sits in the North County Visa courthouse and issued the prior fee award), based on the SLAPP grants, awarded attorney’s fees of $32,153 to Mr. Bona (the full request) and $14,453 to Mr. Breen (a reduced award).  Judge Freeland primarily determined that the outspoken criticisms and posts were “social commentary, not personal threats,” according to an April 9, 2021 article by Phil Diehl in the one-line version of The San Diego Union-Tribune.

In The News . . . . Massachusetts Supreme Judicial Court Enters Two-Year Suspension For BigLaw Partner Who Added Fictional Hours To Billings, Even Though She Did Excellent Work

The Math Did Not Add Up.

            As reported recently in the on-line version of the ABA Journal, a BigLaw partner in Massachusetts was suspended for 2 years after the Massachusetts Supreme Judicial Court found that she had added about $216,000 in fictional billings while at Saul Ewing, even though she did excellent work.  The court concluded that her explanations did not “add up”—she would have had to work 24 hours a day on 12 different dates to make the billings square, a proposition not found credible.

In The News . . . . OC Board Of Education/School Superintendent Al Mijares Dispute Have Generated Lots Of Fees, Most Of Which Are Picked Up By Taxpayers

Recent Orange County Register Article Reports What Happened.

            In a March 21, 2021 article by Roxana Kopetman in The Orange County Register (you can access the online version here), there is a report of the attorney’s fees expended in various disputes between the Orange County Board of Education and School Superintendent Al Mijares, many about a 2018 case resulting in a 22-day trial (but settled subsequently) over the hiring of a general counsel for both the Orange County Department of Education/Orange County Board of Education and other related disputes.  Here is the tab to taxpayers as of February 24, 2021 on the main dispute: (1) $1,737,873 to attorneys representing the Board; and (2) $1,446,606 to attorneys representing Mr. Mijares.  (As part of the settlement, the Board may continue to use the attorney of its choice as long as there is no conflict of interest, and Mr. Mijares has to pay some remaining invoices to Board’s attorneys, although no one was declared the prevailing party to prevent a future fee motion dispute.)  There is other litigation over who has financial control over the department’s budget, with the County paying $91,319 to Board attorneys and paying $36,812 to attorneys representing Mr. Mijares in this battle.  On March 15, 2021, the Board has signed a retention agreement to hire general counsel (the attorney preferred by the Board) for rates running from $155 an hour for paralegal services to $355 an hour for work by one of the firm’s partners, according to the newspaper report. 

In The News, Sanctions: Attorneys In Voting Dispute Sanctioned For Not Being Candid With The Court

They Should Have Revealed That An Almost Identical Motion Was Made And Denied Before.

            As recently reported in the on-line ABA Journal, the Fifth Circuit Court of Appeals in Texas Alliance for Retired Americans v. Hughs, No. 20-40643 (5^th Cir. Mar. 11, 2021) (per curiam, 2-1 vote) issued sanctions against defendant’s attorney in a lawsuit seeking elimination of straight-ticket voting in Texas based on the theory it disproportionately affected minorities.  What happened is that defendant filed a second motion to supplement the appellate record even though a nearly identical first motion had been denied earlier.  As indicated by the majority, “This inexplicable failure to disclose the earlier denial of their motion violated their duty of candor to the court.”  It also was an improper motion for reconsideration filed outside of the fourteen-day window for such motions under appellate rules.  Even if the attorneys were confused about what was done earlier, all they had to do was disclose the earlier motion in their subsequent paperwork. The majority imposed double-barrel sanctions: (1) the fees and costs incurred by plaintiffs in connection the duplicative motion; and (2) “double costs.” 

In The News: U.S. Large Law Firms, As A Whole, Saw Net Income Go Up In 2020 During The Pandemic After Discretionary Cuts, With Many Partners Taking Cuts Averaging 15% Of Their Draws

For 2021, Net Income For Firms Still Predicted To Go Up.

            Although the COVID-19 pandemic certainly has affected the U.S. law industry, some recent reports suggest that its impact was not as bad as feared, according to some articles on the February 3, 2021 on-line edition of the ABA Journal.

            U.S. law firms cut overhead such that larger law firms had a net income average growth spurt of 9.9% (an 11.2% growth in profits per equity partner).  However, a Law360 release, looking at data between September 1-October 16, 2020 for firms with at least 25 attorneys, found that 43% of the partners took pay cuts, with the pay cut being a median 15% in amount.

            In 2021, U.S. law firms are expecting an average 3.5% growth in revenues. 

Celebrities, News: Washington Post Reports That Donald Trump Has Instructed Aides Not To Pay Rudy Giuliani's Legal Fees

Of Course, We Are High-Minded And Therefore Only Interested In The Potential Legal Issues . . . 

        On January 13, 2021, journalists Philip Rucker, Josh Dawsey and Ashley Parker of the  Washington Post, reported that outgoing President Donald Trump has instructed his aides not to pay Rudy Giuliani's legal fees. Specifically, they write:

"Trump has instructed aides not to pay Giuliani’s legal fees, two officials said, and has demanded that he personally approve  reimbursements for the expenses Giuliani incurred while traveling on the president’s behalf to challenge election results in key states. They said Trump has privately expressed concern with some of Giuliani’s moves and did not appreciate a demand from Giuliani for $20,000 a day in fees for his work attempting to overturn the election."

Our beat is attorney's fees, and we do not enter into the political fray. Instead, we suggest a few serious questions:

1) When Giuliani undertook the assignment, did he and Trump enter into a written agreement? 

2) If Giuliani and Trump entered into a  written agreement, do disputes require arbitration?

3) Were both parties to the contract mentally competent?

4) What was the  scope of Giuliani's legal  assignment -- to undo the election?

5) Did Giuliani make promises about what he would accomplish, to wit, overturn the popular election results? 

6) Was Giuliani's reported fee of $20,000/day reasonable? (For a New York attorney, former Mayor of Gotham, former  US Attorney for the SDNY, with 50 years experience.)

7) Did Giuliani make proper time entries? Did he block bill?

8) Were Giuliani's fees reasonably and necessarily incurred?

9) Did Giuliani commit malpractice?

10) Does New York state law or other law govern the attorney-client contract?

11) Did Giuliani represent Trump pro bono, and if so, for what period of time?

13) Has Giuliani violated any New York Rules of Professional Conduct during his representation of his client?

14) Did Giuliani provide poor legal advice in connection with the rally on January 6, 2021 in Washington D.C., at which Giuliani and Trump spoke, following which a violent mob stormed the Capitol, resulting in Trump's impeachment?

15) Did Giuliani display absolute fidelity to Trump?

16) Did Giuliani unnecessarily incur legal costs when he booked Four Seasons Landscaping?

17) Did Giuliani display bad hair on camera?

18) Did Trump violate the law by failing to mention Mr. Giuliani or his unpaid labor for 20 months on the annual financial disclosure he filed in May, "which requires that the value and source of gifts — including free legal work — be publicly listed," as reported by the NYT?

19) Has Trump engaged in unfair business practices by following a modus operandi of stiffing business creditors?

20) Are the journalists' reports of a falling out between Trump and his loyal friend and personal attorney Giuliani simply Fake News?

 

 

IN THE NEWS . . . . CALIFORNIA RANKS #3 ON “JUDICIAL HELLHOLES” 2020-2021 RANKINGS

Proposition 65; Lemon Law; PAGA; Privacy Act; ADA; and Public Nuisance Issues Abounded.

            The American Tort Reform Foundation published its 2020-2021 “Judicial Hellholes” report, traditionally reporting the jurisdictions where businesses should fear having to be subject to as far as venue from a plaintiff’s perspective.

            California actually slipped to #3, below Philadelphia/Pennsylvania and New York City.  However, it only fell due to the others being more egregious, according to its report.

            Here are the substantive areas which contributed to its #3 ranking:  Proposition 65; lemon law cases; PAGA; Privacy Act [no cases, but some future expected matters]; ADA [disability construction/website cases]; public nuisance [climate change, vaping, and opioid potential matters]; and employment matters [mainly independent contractor, ABC issues]. 

            ADA took some significance, given the minimum $4,000 per violence damages remedy.

            Lemon law was really highlighted, discussing a San Diego County Superior Court decision on August 7, 2020 where a plaintiff won $1.00 in damages but was awarded $684,250 in attorney’s fees (out of a requested $1 million in fees and costs). 

Civil Rights, In The News: Lawyer Winning $1 From Jury, In Federal Civil Rights Case, Was Awarded $1 In Attorney’s Fees And $862 In Costs Arising From Police Snatching Of A Pen

$44,800 In Fees Requested, But Symbolic Victory Only Entitled A Nominal Fee Award—This Was Not A Federal Case; “Don’t Make A Federal Case Out Of That.”

            An attorney got into an altercation at a police headquarters when attempting to serve a lawsuit.  The police’s office for receipt for service was closed, and two officers refused to accept service, with one officer grabbing the attorney’s writing pen away from him as the attorney was attempting to write down the officer’s name and shield number—even though the officer had a relatively minor reprimand by a Civilian Complaint Review Board.  The attorney also alleged that another officer threw the legal papers at the attorney, an allegation which was not proven later on.  Believe it or not, the attorney filed a federal civil rights and state tort suit against the City of New York and various individual defendants, primarily law enforcement officers—mainly seeking compensatory and punitive damages.

            After many of the claims were dismissed both pretrial and during trial (with the federal district judge signaling punitive damages were unwarranted), attorney eventually recovered a $1 jury verdict (no punitive damages) and then sought to recover $44,800 in fees as well as $862 in costs (only with respect to trial costs). 

            Chief U.S. District Judge Colleen McMahon of the Southern District of New York federal court, in Rothman v. The City of New York, Case No. 19 Civ. 225 (CM) (S.D.N.Y. Nov. 30, 2020 Opinion and Order on Motion for Attorney’s Fees, Doc. No. 171), awarded attorney $1 in attorney’s fees and $862 in costs. 

            The main problem for the prevailing plaintiff attorney, although there is a federal civil rights fee-shifting statute, was that his victory was nominal and really symbolic in nature, not benefitting the public at large.  The degree of success is a critical factor in the civil rights area, with plaintiff not achieving a meaningful victory.  Although he argued that the other side would not settle, the district judge had to observe that his demands never went below five figures such that this argument was not persuasive because those demands could be prudently rejected. 

            Here is a great quote from this decision: “Once upon a time, we urged people not to make too much of real but petty grievances by saying, ‘Don’t make a federal case out of that.’  This lawsuit was a violation of that principle writ large.” 

In The News . . . . Quinn Emanuel Firm Is Seeking 5% Of Class Action Recovery By Insurers Suing The Federal Government For Affordable Care Act Compensation In U.S. Court of Federal Claims

That Translates To An Hourly Fee Of $18,500, Almost A Twenty Percent Positive Multiplier.

            Here is an interesting one to see how it will pan out. 

            Quinn Emanuel is seeking 5% of a class action recovery by insurers suing the federal government in the U.S. Court of Federal Claims for Affordable Care Act compensation.   That fee is 5% of the $3.7 billion recovery by insurers, which certainly would not be alarming under the percentage-of-recovery benchmarks (even in mega-settlement cases).   However, the rub is that a lodestar check shows that the class action attorneys would be receiving close to a positive 20 times multiplier to their normal billable hourly rates, translating to hourly rates as high as $18,500.  This will be an interesting one to follow as far as determining what the judge does.

In The News: Top Law Firms Not Doing So Bad During The Pandemic

However, Next Few Months May Define What Actually Happens.

            We were somewhat surprised by the results of a Wells Fargo Private Bank’s legal specialty’s group survey of April-May 2020 data for 52 of the top grossing law firms and 20 midsized/regional law firms, which chartered some trends during the coronavirus pandemic.

            Overall, cash collections increased more than 3% in May 2020, with expenses basically flat as the surveyed firms decreased discretionary spending.  54% of reporting firms said client requests for discounts increased in May as compared to April 2020.  52% also said that there were more client requests for payment extensions in May of this year.  Number of associates dropped by just .9%, while nonlegal staff positions dropped by 4.1%.  Nonlegal staff layoffs occurred most often in jobs that did not lend themselves to remote work. 

            What practice areas have suffered?  Answer:  transactional, corporate and real estate.  What practice areas have remained robust?  Answers:  bankruptcy; banking; labor/employment (with a host of labor issues raised by the COVID-19 pandemic). 

            Liquidity was better than expected, with 90% of the surveyed firms having the ability to cover three months of monthly expenses, excluding partner draws.  More than 50% of the reporting firms cut of delayed partner contributions so there was more cash on hand.

            The real test may be future collections in the next 3-4 months.  That future may be testy, which may greatly influence how firms end up at the end of 2020. 

In The News . . . . A Couple of Recent Surveys Show How the COVID-19 Pandemic Has Impacted Law Firm Revenue

Law Firms Have Been Hit Hard, Also.

            According to a May 18, 2020 post by Lyle Moran on the ABA Journal website, roughly 81% of law firms suffered a revenue drop during the pandemic, with 27% of the reporting firms in a recent survey by Martindale-Avvo stating that they had seen business decline by more than half.  Cloud-based Clio reported that the pandemic had resulted in a 40% drop in the number of new legal matters opened each week in the U.S. compared with the number in late February 2020.  Nearly 20% of the Martindale-Avvo survey reporting firms said they had to lay off and furlough staff.  More than 60% of the reporting attorneys indicated their belief that it will take from four months to a year for their firms to revert back to the pre-pandemic status quo.

In The News . . . . City of Costa Mesa Has Won Sober Living Operator Disputes, But Has Spent $7 Million On Fees So Far

Operators’ Attorney Said His Clients Will Appeal Summary Judgment Rulings To The Ninth Circuit.

            As reported by The Orange County Register in an April 15, 2020 online article entitled, “Winning streak for Costa Mesa as it battles sober living home lawsuits,” the City of Costa Mesa has obtained several favorable summary judgment rulings against sober living operators challenging restricted zoning laws, but at quite a price tag—some $7 million in legal fees (compared to its 2019 budget of $174 million).  One of operators’ lead attorneys, Isaac R. Zfaty, was quoted as saying that all of these matters will be appealed to the Ninth Circuit Court of Appeals.

            BLOG COMMENT—Co-contributor Mike had the pleasure of trying a seven-week jury trial with Mr. Zfaty (who has his own firm, Zfaty Burns) and Mr. Mark Adams (a partner with Jeffer Mangels), both of whom were superb attorneys and colleagues for the defense side of the case.

In The News . . . . California Is Number Two Worst Jurisdiction For Defendants/Good For Plaintiffs In ATRA’s 2019-2020 “Judicial Hellholes” Report

Philadelphia Surpasses California This Time, With California Number One In 2018-2019.

            The American Tort Reform Association (ATRA) has come out with its 2019-2020 “Judicial Hellholes” Report.  California slipped from #1 to #2, but only because Philadelphia was rated as really bad by ATRA.

            Here is the listing of the worst venues for defendants and best for plaintiffs:  (1) Philadelphia; (2) California; (3) New York City; (4) Louisiana; (5) St. Louis, Missouri; (6) Georgia; (7) Illinois (especially Cook County); (8) Oklahoma; (9) Twin Cities, Minnesota; and (10) New Jersey.

            With respect to California, ATRA cited The Perryman Group as estimating that excessive tort litigation results in $11.6 billion in annual direct negative costs and loss of 197,776 jobs. 

            Here were the litigation areas/developments which ATRA listed as being plaintiff boons in California:  Proposition 65; Private Attorneys General Act (PAGA); expansion of public nuisance law; new data privacy law; lemon law matters; class actions (especially food and beverage); invalidation of arbitration clauses; liberal independent contractor expansion via the Dynamex test; wage/hour cases; and ADA matters. 

In The News . . . . Citi Private Bank’s Law Firm Group’s Survey Shows Expenses Ate Up Revenue Gains Based On Polling Results From 191 U.S. Law Firms

Receivable Collection Cycles With Clients Lengthened During The First Half Of 2019.

            In an August 21, 2019 article by Debra Cassens Weiss on ABA’s on-line journal, she reports on the results of a Citi Private Bank’s Law Firm Group’s survey of 191 U.S. firms, ranging from top-grossing to boutique firms.

            Although the polled law firms’ revenues grew 4.1% in the first half of 2019 (mainly due to billing rate growth of 4.6%), expenses also grew 5.9%.  That meant that the increase in expenses—mainly, 7.3% jumps in lawyer compensation—exceeded the revenue growth.  The survey also noted that collection cycles lengthened by 1.6% for clients.  The report cited e-billing systems and greater scrutiny of bills, with some clients unilaterally changing payment terms, as driving the receivable collection “lag.”

In The News . . . . Judge In Largest Ohio Libel Judgment Of $25 Million Awards Plaintiffs’ Attorneys Almost $6.3 Million In Attorney’s Fees And $300,000 In Expenses

Fee Award Included A Positive 1.5 Multiplier For Plaintiffs’ Counsel.

            Gibson’s Bakery and its owners sued Ohio’s Oberlin College for libel/intentional infliction of emotional distress, winning a jury verdict of around $44 million (compensatory and punitive damages added together).  Later, Lorain County Common Pleas Judge John Miraldi reduced the judgment to $25 million—Ohio’s largest libel judgment.

            Plaintiffs’ attorneys, two law firms and a sole practitioner, then requested attorney’s fees of $9.5-14.5 million for 14,400 in billable hours as well as $404,000 in expenses.  Oberlin College countered that a proper fee award should be in the range of $2-2.25 million, although defense counsel admitted billing 15,600 hours on the case.

            Judge Miraldi determined that the proper lodestar for plaintiffs’ attorney work was $4,180,930, which he increased to $6,271,395 based on a positive 1.5 multiplier enhancement.  He also awarded $294,000 in expenses, about 75% of plaintiffs’ request. 

In The News . . . . Recent Corporate Counsel Global Benchmarking Reports Offers Clues For What Is Kept In-House And What Goes Outside

Hourly Billing Rate Still Prevails For Legal Work Referred By Corporations To Outside Counsel.

            The Association of Corporate Counsel and recruiting firm Major, Lindsey & Africa partnered up to release a 2019 Global Legal Department Benchmarking Report, which can be obtained freely through a Website search.  It involved interview responses from 508 corporate law departments, operating across 30 countries and 71 industries.  Here is a summary of the results which interested us:

• • Two-thirds of corporate departments hire outside firms using standard hourly or discounted hourly rates, followed by nearly 45% that use flat fees, and 31% that use “capped fees.”
  • Most in-house legal teams accounted for a small percent of their company’s total staff, about 0.3% of employees.
  • Contract management internal work stayed in-house, at 97%. This work generally was performed by lawyers, versus paralegals or other legal assistants, in more than 80% of the surveyed departments.
  • The median legal department used 10 firms, listing three as “significant” firm relationships.

In The News . . . . Recent Article By Todd C. Scott Nicely Summarizes The Nine Rules For Billing Ethically And Getting Paid On Time

Communication/Clarity At All Stages Pervade These “Rules.”

          We thank NALFA for summarizing an article by Todd C. Scott, Vice-President of Risk Management at Minnesota Lawyers Mutual, entitled “Nine Rules For Billing Ethically and Getting Paid on Time” (which came from an ABA website article).   Here are the rules, to which we have added some gloss based on the commentary accompanying them (but with our takeaways):

1. Communicate the fee arrangement before you start      the case — usually, in writing (sometimes required        depending on the jurisdiction, unless you want to          be relegated to quantum meruit recovery).

                 2. Your fee better be reasonable.

                 3. “Nonrefundable” does not mean that you can be                             paid for doing nothing.

                 4. Verbal flat fee arrangements are as good as the                               paper they’re written on.

                5. Availability (“true retainer”) fees are separate and                          distinct from legal services fee.

                6. If the fee is shared with someone outside the firm,                          the client should know exactly where it is going.

                7. Three keys for effective invoicing: detail, detail,                              detail — including “no charge” entries for services                          which are not being billed for payment.

                8. When the payment is late, be direct. Clients like                               direct — lawyers need to communicate they need                           payment as much as any other service provider.

                9. Foonberg’s rule: If you’re going to get burned, get                          burned cheap — if the client bill starts to spiral too                        high, get payment or get out unless a short-term                              catch up can be done. (Jay Foonberg is author of a                            popular publication, “How to Start and Build a Law                            Practice.”)

In The News . . . . Plaintiffs’ Attorneys In Latino Voting Rights Case Seek $22.3 Million In Fees And Expenses As Counsel For Prevailing Plaintiffs Against The City of Santa Monica

City Is Appealing The Merits Determination Of Voting Rights Violations; Plaintiffs’ Lead Counsel Estimates City Spent Between $13-20 Million On Defense Side.

     As reported by Jorge Casuso in “Voting Rights Attorneys Seek More Than $22 Million In Legal Costs” in an updated June 4, 2019 post in the Santa Monica Outlook, Plaintiffs’ attorneys are seeking $22.3 Million in attorney’s fees and expenses after a superior court judge ruled that Santa Monica’s at-large election system discriminates against Latino voters, a Voting Rights Act victory for which there is fees/costs-shifting.  City has filed an appeal on the merits.   Plaintiffs’ lead counsel estimates that the defense spent between $13-20 million in opposing efforts.  Plaintiffs’ attorneys are seeking compensation for hourly rates between $740-975 per hour, with one attorney estimating that the defense attorneys bill out at between $1,000-$1,500 per hour.  Right now, a hearing has been requested for late August of this year.

In The News . . . . City Of San Juan Capistrano Seeking To Recoup $1.9 Million In Legal Fees From Insurer In Equestrian Center Contamination Settlement

Lawsuit Claims Insurer Only Paid 25% Of Total Fees.

            As reported in the May 8, 2019 edition of The Orange County Register, San Juan Capistrano has sued its insurer Tokio Marine Specialty Insurance Company to recoup $1.9 million in unpaid legal fees the City incurred in reaching a settlement respecting water contamination at the Rancho Mission Viejo Riding Park. The suit claims that the insurer only paid about 25% of the $2.3 million the City spent on reaching the equestrian center settlement.