CALIFORNIA ATTORNEY'S FEES

Civil Rights: $610,050 FEHA Fee Award Affirmed In Case Where Plaintiff Obtained $4 Million Judgment Against City of L.A.

Lower Court Did Not Abuse Its Discretion On The Fee Award—It Cut The Requested Fees By $525,342.75.

               In Carranza v. City of Los Angeles, Case No. B327196 (2d Dist., Div. 7 May 23, 2025) (partially published; fee discussion not published), a plaintiff sued City of Los Angeles under FEHA for a hostile work environment based on sexual harassment.  She won, obtaining a $4 million judgment affirmed in the published part of the opinion.  Plaintiff then asked for $1,135,392.75 in FEHA fees ($756,928.50 lodestar plus a 1.5 positive multiplier).  After cutting some hourly rates and fees, the lower court awarded $610,050 in fees, inclusive of a 1.2 positive multiplier for some work by the two lead attorneys.

               The unpublished portion of this opinion affirmed the fee award.  The trial judge has leeway to determine reasonableness of hourly rates and work efforts based on his or her own experience, although fee expert testimony obviously can be facilitative.  The main problem on the fee number, because it was reviewed for abuse of discretion, was two-fold:  (1) the lower court reduced the fee “ask” by $525,342.75; and (2) the 1.2 positive multiplier did take into account the skill of plaintiff’s attorneys such that a further enhancement was not compelled based on other factors such as contingency risk.

Special Fee Shifting Statutes: Plaintiff Winning Financial Elder Abuse Claim Against Adult Son Of A Dependent Father Was Properly Awarded $435,762 In Attorney’s Fees

Welfare & Institutions Code Section 15657.5 Allows For A Mandatory Fee Award.

               In Letitchevski v. Sosa, Case No. B333962 (2d Dist., Div. 7 May 22, 2025) (unpublished), plaintiff, on behalf of a dependent father, won a financial elder abuse claim involving father’s adult son, by which a property transfer was voided, $13,500 was awarded back to father, and a $750,000 Probate Code section 859 penalty was awarded against adult son.  Then, the lower court awarded attorney’s fees to plaintiff under Welfare & Institutions Code section 15657.5(a), a mandatory financial elder abuse fee shifting statute, in the amount of $435,762, reduced from the $699,031.75 fee request.

               On appeal, the 2/7 DCA reversed the Probate Code penalty, but affirmed the other components of the judgment.  The fee award was sustainable because it was mandatory in nature and the lower court showed a proper exercise of discretion by reducing the award from the initial “ask.”

Landlord/Tenant, Prevailing Party, Section 1717: Because Landlord’s Voluntary Dismissal Of An Unlawful Detainer Action Sounded In Contract, Its Dismissal Did Not Entitle Tenant To Attorney’s Fees

Appellate Court Did Discuss When The Action Is Contract Versus Tort, But The Case Did Not Have Tort Holdover Or Ouster Issues.

               In an unlawful detainer case, the nature of the case may determine whether a landlord’s voluntarily dismissal allows the tenant an entitlement to attorney’s fees, which invokes the Santisas principle.  (See Our Leading Case #6.)  Trial and appellate courts tend to look at what is really involved in the action, with that reality often driving the “end result.”

               That “end result” conclusion was at issue in Concord Property Management, Inc. v. Lin, Case No. B331933 (2d Dist., Div. 8 May 22, 2025) (unpublished).  There, a landlord in an unlawful detainer action voluntarily dismissed its complaint after the lower court denied landlord’s motion for summary judgment.  Tenant sought an award of $74,230 in attorney’s fees as the prevailing party, but the lower court determined that the gist of the action was “on a contract” so that the voluntary dismissal did not allow for fee entitlement under Santisas.

               The appellate court agreed that tenant was not entitled to fees.  The gravamen of the action was to bring a forfeiture of the lease (a contractual theory) as opposed to ousting a holdover tenant (a tort). (See Mitchell Land & Improvement Co. v. Ristorante Ferrantelli, Inc., 158 Cal.App.4^th 479, 490; Drybread v. Chipain Chiropractic Corp., 151 Cal.App.4^th 1063, 1076 (2007).)

Homeowner Associations: Complaint Allegations And Discovery Responses Revealed That Losing Plaintiffs’ Claims Were Based Partially On CC&Rs

This Meant That Fees Were Recoverable By The HOA Under The Davis-Stirling Act Fee Shifting Provision.

               In Smith v. Bridle Path Homeowners Association, Inc., Case No. B331987 (2d Dist., Div. 6 May 21, 2025) (unpublished), plaintiffs owning homes in a Simi Valley planned equestrian community sued an HOA for deciding to not maintain certain parkways and slopes adjacent to a bridle path and other common areas.  HOA won the case because the CC&Rs placed the maintenance responsibilities on individual homeowners.  The lower could then awarded HOA attorney’s fees of $174,984.90 under the Davis-Stirling fee shifting provision because the claims were based at least in part on the CC&Rs.

               The 2/6 DCA affirmed the fee award.  Both the allegations of the Complaint and plaintiffs’ discovery responses established the claims were based in part on the CC&Rs, which triggered fee shifting.  (See Civ. Code, § 5975(c); LNSU #1, LLC v. Alta Del Mar Coastal Collection Community Assn., 94 Cal.App.5^th 1050, 1082 (2023).)  Because plaintiffs’ claims related to the CC&Rs, there was no requirement to apportion between theories advanced at a trial where plaintiff lost. 

Arbitration, Employment: 30-Day Arbitration Payment Deadline Under CCP § 1281.98 Runs From Invoice Issuance Date By ADR Provider

. . . And It Is Extended By CCP § 12 Extensions If Deadline Falls on a Holiday or Weekend.

               We have seen an uptick on decisions considering CCP § 1281.98, the section requiring employers to timely pay arbitration expenses invoiced by an ADR provider within 30 days under penalty of returning the case to superior court (or, as indicated in a recent post, bearing all arbitration fees and costs if the employee agrees to proceed to arbitration).

               In Bautista v. Los Angeles Apparel, Inc., Case No. B337940 (2d Dist., Div. 5 May 20, 2025) (unpublished), the issue was whether an employer failed to timely pay arbitration expenses under section 1281.98 where it paid them timely based on an invoiced date of an ADR provider, but assuming that the due date was extended because the payment date fell on a holiday or weekend.  The appellate court reviewed the statutory provisions, deciding that CCP § 12 extension dates should apply in this context, such that the 30^th day deadline was extended when it fell on a holiday or weekend. 

Default Judgments: $9,000 Attorney’s Fees Component Of Default Judgment Reduced To Zero On Appeal

Lease Contractual Clause Not Implicated In The Default Judgment.

               In Hernandez v. Nunez, Case No. E083404 (4^th Dist., Div. 2 May 19, 2025) (unpublished), defendants suffered an adverse default judgment inclusive of attorney’s fees of $9,000.  Defendants did appeal, which resulted in the attorney’s fees amount being reduced to zero.  A lease contractual fees clause was not implicated against defendants, so there was no fee entitlement.  Other components of the default judgment were largely sustained on appeal. 

Arbitration, Employment: Where Employer Did Not Timely Pay Arbitration Expenses Within 30 Days And Employee Opted To Stay In Arbitration, Employee Can Get Recovery Of All Arbitration Expenses, Including Fees Through The End Of The Arbitration

Although Unpublished, This Is An Important Reminder To Employers On Timely Paying Arbitration Fees, Under Penalties Even If Employee Opts For Arbitration.

               Although unpublished, Lehman v. MediaLab.AI, Inc., Case No. B336814 (2d Dist., Div. 5 May 19, 2025) (unpublished), is an opinion that employers need to pay attention to in case they are delinquent in paying arbitration expenses—because employee has an option to compel arbitration or return the case to a California superior court.  Employee adopted the first option, which maybe resulted in surprise exposure for employer.

               Employer failed to pay for arbitration as required under CCP § 1281.97.  Employee then petitioned the lower court for an order compelling arbitration and payment of all employee’s attorney’s fees and costs “related to the arbitration.”  Alternatively, employee only asked for payment of fees to compel arbitration.  After a contested hearing, the lower court awarded fees of $4,240.20 in fees and costs for employee’s expenses in filing the petition to compel arbitration.

               On appeal, employee obtained a reversal.  The appellate court viewed the “related to arbitration” language as allowing an employee to recover more than just motion to compel arbitration costs, which it decided were allowable more than just these limited fees.  It indicated that this was the penalty for noncompliance where an employee opted to still pursue arbitration—so, an employee might be able to get fees and costs for the entire arbitration, if we are reading this decision correctly.   Quite a result and an exposure for noncompliant employers.

Costs, Employment: On Remand From California Supreme Court, Third District Reverses Appellate Costs Award To Prevailing Defendant In A FEHA Action

Pollock Analysis Dictated The Overturn.

               In York v. City of Sacramento, Case No. C097761 (3d Dist. May 14, 2025) (unpublished), the Third District in an earlier opinion affirmed a summary adjudication order against plaintiff in a FEHA case and awarded appellate costs to the prevailing employer.  The California Supreme Court granted review and remanded for the DCA to perform the analysis set forth in Pollock v. Tri-Modal Distribution Services, Inc. (2021) 11 Cal.5^th 918, 947-951 to determine if plaintiff’s case was frivolous, groundless, or without foundation before awarding appellate costs.  On remand, the Third District determined plaintiff’s case was not groundless, overturning the costs award in the defense’s favor.

Fee Clause Interpretation: Losing Party To An Oral Agreement To Foreclose On A Property Was Not Liable For Fees Under A Promissory Note

Losing Party Was Not A Signatory To The Note, And The Foreclosure Oral Agreement Was Separate From The Note.

               Kim v. Kim, Case No. B336809 (2d Dist., Div. 1 May 14, 2025) (unpublished) involved a fight between plaintiffs and defendants over an oral agreement to foreclose property, with plaintiffs paying $25,000 under that agreement but defendants claiming $420,000 was owed.  Plaintiffs lost the case, and defendants sought $280,700 under a contractual fees clause in a note between defendants and the note borrower.  The lower court denied the fee request.  The 2/1 DCA affirmed, determining that (1) plaintiffs were not signatories to the note, and (2) the foreclosure arrangement was separate from the note and not “related”/”connected” to the note. 

Costs, Employment: Prevailing Defendant Employer Improperly Awarded Costs In PAGA Action Against LWDA Where It Did Not Participate In The Underlying Litigation

$124,585.24 Costs Award Vacated As A Matter Of Law On Appeal.

               In Rose v. Hobby Lobby Stores, Inc., Case No. A169640 (1^st Dist., Div. 2 May 14, 2025) (published), defendant employer prevailed in a PAGA action brought by plaintiff employee, with the California Labor and Workforce Development Agency (LWDA) not participating in the litigation although having notice of it because a PAGA action is a type of qui tam action.  Eventually, after LWDA intervened on a post-judgment costs motion against employee, the trial court awarded $124,585.24 in costs to be paid by LWDA.

               On appeal, the appellate court reversed.  Nothing in the Labor Code or general costs statute allowed for an award of costs against LWDA unless it participated in the litigation, which it did not.  That is the holding in this opinion, with the Court of Appeal not having to decide whether a prevailing defendant in a PAGA action is entitled to recover its litigation costs under the general costs statute, CCP § 1032(b).

POOF!: Prevailing Plaintiff’s Appeal Of A Fee Denial Stayed Its Second Successful Effort To Have The Court Reconsider And Award Fees Of $4.479 Million, Which Meant The Second Fee Award Was Void

CCP § 916 Appellate Stay Was The Key, Meaning the Large, Subsequent Fee Award Went POOF!

               Although this may sound technical, the result in CDC San Francisco, LLC v. Critchfield Mechanical, Inc., Case No. A169224 (1^st Dist., Div. 2 May 6, 2025) (unpublished) shows how taking an appeal will stay subsequent efforts to obtain a subsequent, “turn-around” fee award where the lower court has initially denied the request.

               In this one, plaintiff hotel owner obtained an $18 million award against defendant HVAC contractor.  Plaintiff then moved for fees of over $6.718 million, a request denied by the lower court based on its interpretation of contractual fee clauses put before it.  Plaintiff then appealed the fee denial.  However, plaintiff then filed a reconsideration fee motion based on a different contractual basis, with the lower court deciding its prior determination was erroneous and entering a favorable fee award of $4.479 million to plaintiff.  Plaintiff, feeling emboldened, then dismissed its appeal of the fee denial.

               Defendant, very unhappy with the turn of events, appealed.  Smart move.

               The appellate court determined that the CCP § 916 appellate stay prevented the lower court from granting the subsequent fee reconsideration request given the pendency of the appeal of the fee denial—the fee grant order was void, citing Varian and Elsea.  It found unpersuasive plaintiff’s argument that section 916 was based on a separate contract, labeling it “a distinction without a difference” given that a section 1008 reconsideration motion is a subsequent application for the same order.  With that said, the “end result” was that the $4.479 million fee order went POOF! on appeal.

Costs: Prevailing Defendant Was Entitled To Most Routine Costs . . .

However, Because Statute Allowing CourtCall Costs As Being Mandatory Was Repealed, Matter Had To Be Remanded To Determine If It Was A Correct Discretionary Costs Matter Under The General Routine Costs Statute.

               Prevailing defendant, winning on a summary judgment motion, was granted certain costs for deposition transcripts and record subpoenas given that co-counsel needed the deposition transcripts, and the subpoenaed records were relevant on damages before defendant obtained summary judgment.  The 4/3 DCA, in Safavi v. Ritzau, Case No. G062901 (4^th Dist., Div. 3 May 6, 2025) (unpublished), affirmed those determinations.

               However, it did reverse and remand a minimal costs award of CourtCall expenses because it was granted under CCP § 367.6(c), which was repealed on January 1, 2023 before the costs award was issued [that provision made it mandatory to award CourtCall expenses] such that it was not good authority for a costs award.  However, the appellate panel did remand to allow the lower court to grant the requested fees under the discretionary provision of CCP § 1033.5(c)(4), where cases have allowed CourtCall expenses to be awarded.  The amount was around $376, so we can only assume this matter will be settled before a remand is necessary—but who knows!  Justice Scott authored the 3-0 opinion.

Arbitration: 2/7 DCA Decides That Employer Deadline To Pay Arbitration Expenses Is Not Preempted By The FAA

Also, Whether The Employer Is In Default Is An Arbitrator Decision.

               In Sanders v. Superior Court, Case No. B340707 (2d Dist., Div. 7 May 6, 2025) (published), the appellate court decided that the FAA did not preempt CCP § 1281.98(a)(1), which gives employers a strict 30-day deadline to pay arbitration expenses under penalty of losing arbitration rights.  It disagreed with Hernandez’s contrary reasoning on this point, after noting that various cases—Keeton, Hohenshelt, and Hernandez—were under California Supreme Court review on the preemption issue.  Sanders also decided that the arbitrator is the decision maker to decide if there was a default under section 1281.98. 

Homeowner Associations: HOA/Affiliated Defendants Properly Awarded $81,083 In Fees Under The Davis-Stirling Act After Plaintiff Voluntarily Dismissed Her Suit

Defense SLAPP Fees, Although SLAPP Grant Was Reversed, Were A Proper Element In The End, Because Litigation Sometimes Involves Unsuccessful Efforts—Giving Trial Judges Discretion On Whether to Award Fees For Those Efforts.

               In Mondragon v. Bergmann, Case No. B335486 (2d Dist., Div. 3 Apr. 30, 2025) (unpublished), plaintiff suing a homeowner’s association and related defendants did win an anti-SLAPP grant and adverse fee order, but later voluntarily dismissed her suit without obtaining a settlement or any judgment.  HOA then requested $81,083 in attorney’s fees under the Davis-Stirling Act’s fee shifting provision (which also included the anti-SLAPP fees reversed in the prior appeal).  The lower court determined the HOA side achieved their litigation objective in obtaining a dismissal of the suit, awarding the full amount requested.

               The 2/3 DCA affirmed the fee award against the plaintiff.   The HOA side did obtain their litigation objectives such that it affords the lower court discretion to determine that it prevailed notwithstanding the voluntary dismissal, citing Santisas, Saleh, and Haidet.  With respect to the anti-SLAPP fees also being included, that ruling was no abuse of discretion, because litigation sometimes involves unsuccessful work such that the lower court has discretion to determine if it should be awarded or not—with the appellate court citing City of Sacramento v. Drew and Simers for this proposition.

Judgment Enforcement: Enforcement Of Canadian Judgment In California State Courts Reminds Us That Attorney’s Fees Awarded In A Foreign Court Are Compensatory In Nature

They Are Not Penal, So Recognition Of The Award In California Is Proper.

               Racicot v. Wiseau Studio, LLC, Case No. B334219 (2d Dist., Dif. 3 Apr. 30, 2025) (unpublished) is a situation where a Los Angeles County Superior Court judge domesticated a $1,089,010.16 Canadian judgment under the Uniform Foreign-County Money Judgments Recognition Act, Civ. Code, § 1713 et seq.  In doing so, the opinion reminded everyone that foreign orders requiring a party to pay attorney’s fees are compensatory, not penal in nature, so that they are generally recognized under the Act.  (See Java Oil, Ltd. v. Sullivan, 168 Cal.App.4^th 1178, 1188-1189 (2008).)

Prevailing Party: Ninth Circuit Denies Civil Rights Attorney’s Fees To Plaintiff Whose Case Was Mooted By Hawaii Legislative Amendments

However, Some Concurring Justices Were Concerned That Plaintiffs Will Never Get Fees Under Cases Where They Had Earlier Prevailed, Only To Have Technicalities Render The Matter Moot.

               On March 17, 2025, we posted on Lackey v. Stinnie, 145 S.Ct. 659 (2025), where SCOTUS held that a plaintiff winning a preliminary injunction, with plaintiff’s case subsequently mooted by legislative action, was not a prevailing party under the federal civil rights statute, 42 U.S.C. § 1988(b). 

               We can now report that Lackey was applied to deny appellate attorney’s fees to a plaintiff whose prior win as obliterated by Hawaii’s legislative actions in Teter v. Lopez, Case No. 20-15948 (9^th Cir. Apr. 30, 2025) (published).  However, this recent en banc opinion did stir some concurrences by circuit judges who felt that the fee denial was required based on the prior en banc opinion where the legislative action mooted a district judge’s summary judgment for Hawaii in a Second Amendment challenge to a Hawaiian statute prohibiting butterfly knives and based on the reasoning in Lackey.  Another of the concurring judges expressed concern that Hawaii had “gamed” the case such that plaintiff lawyers could rarely get fees against a governmental defendant based on subsequent legislative amendments—he would have vacated the ministerial order vacating the prior decision undone by the previous en banc decision.

Equity: Losing Ex-Client Was Entitled To Have The Lower Court Gauge If Her Medical Disabilities Prevented Her From Contesting Post-Arbitration Trial Court Proceedings Where She Was Found Liable To Ex-Attorney For Unpaid Attorney’s Fees

Lower Court’s Failure To Consider The Extrinsic Mistake Motion To Vacate Judgment In Post-Arbitration Proceedings Was Error.

               In Mehr v. Korbin, Case No. B335052 (2d Dist., Div. 4 Apr. 25, 2025) (unpublished), ex-client and ex-attorney got into a dispute on the division of attorney’s fees from a third-party global settlement, agreeing to arbitrate the dispute.  Ex-attorney received most of what he wanted, prompting proceedings to vacate or to confirm the arbitration award.  Ex-client did not respond to the petition to confirm, nor appear at the hearing, with judgment entered on the arbitration award in ex-attorney’s favor.  Subsequently, ex-client filed a motion to vacate the judgment under CCP § 473.5 and the equitable doctrine of mistake, arguing that she was disabled because of domestic violence and resulting medical issues.  The lower court denied the motion, finding it was untimely under section 473.5 but apparently not considering the equitable mistake ground raised by ex-client.

               On appeal by ex-client (who relied solely on the equitable mistake argument), the 2/4 DCA reversed and remanded.  Equitable relief for extrinsic mistake is an available ground for a motion to vacate a judgment—with the litigant needing to show (1) a meritorious defense; (2) a satisfactory excuse for not presenting a defense; and (3) diligence in seeking to set aside the judgment once discovered.  (Rodriguez v. Cho, 236 Cal.App.4^th 742, 750 (2015).)  Although not intimating how the decision should go on remand, the reversal was grounded in the lower court abusing its discretion by not considering her equitable ground for relief.

Employment: Based On A Prior Reversal And Remand, Prevailing Employee On A Wage Statement/Personnel Record Turnover Violations Properly Awarded Fees Of $23,035.75

However, Employer Was Awarded $32,682.11 In Appeal Costs. 

               In Ortega v. Carson Wild Wings, LLC, Case No. B338378 (2d Dist., Div. 1 Apr. 24, 2025) (unpublished), employer and employee had a prior appeal by which a fairly sizable jury verdict and attorney’s fees award in employee’s favor was reversed, but remanded for a determination of appellate costs and the lower court’s determination of any fees for employee based on a partial victory.  The lower court awarded employee $23,035.75 for some minor employment violations, as well as appeal costs of $32,682.11 to employer. 

               Employer appealed the fee award to employee.  Employee did have fee entitlement under Labor Code section 1198.5 for employer’s failure to provide her wage statements and personnel records.  Nothing in the prior opinion negated her entitlement to fees, so the modest fee award was affirmed on appeal.

Section 998: Rejected Defense Offer Of $15,000, Where Plaintiff Recovered Nothing, Justified Award Of Defense Costs Request In An Unruh Act Case

Defense Was Awarded $67,313.97 Under § 998, Applicable To Unruh Act Claims.

               In Hughes v. Target Corp., Case No. H050996 et al. (6^th Dist. Apr. 22, 2025) (unpublished), plaintiff brought an Unruh Act claim against defendant based on an altercation with Target’s security guard.  She lost.  Earlier, she had rejected a $15,000 CCP § 998 pre-trial offer to settle after depositions were taken and an unsuccessful mediation took place.  The defense sought costs of $67,313.97 based on the section 998 rejection, with all of it awarded by the lower court.  Plaintiff’s appeal did not gain anything more on this costs-shifting issue: the 998 offer was done properly, it does apply in the Unruh Act context, and plaintiff had plenty of knowledge with respect to making an informed decision on accepting the offer.

Homeowner Associations, Prevailing Party: HOA Owner Properly Denied Attorney’s Fees Because HOA Dismissed Complaint Against Him After Defeating Cross-Claims, So No One Technically Prevailed

HOA Did Get Prior SLAPP Fees For SLAPPing HOA Owner’s Cross-Complaint.

               Loma Linda Homeowners Assn. v. Aquino, Case No. D085390 (4^th Dist., Div. 1 Apr. 22, 2025) (unpublished) is a study on how lower and appellate courts “do justice,” within the confines of legal principles, in HOA owner and HOA disputes.  They are ugly, coming to disparate results—HOA owner wins big, HOA wins big, both sides get mixed results, or both sides go home unvindicated.  In this one, HOA owner did not get the fees he wanted.

               HOA owner was sued for delinquent fees, cross-complaining against HOA, several others, and the HOA attorneys for assessing fraudulent, delinquent assessments.  HOA dismissed its complaint after winning a SLAPP motion against HOA owner’s cross-complaint.  As pertinent for the appeal, HOA owner moved for prevailing party attorney’s fees under the Davis-Stirling Act (Civ. Code, § 5975(c)) to the tune of nearly $100,000, arguing the HOA’s voluntary dismissal of its action meant that HOA owner prevailed.  The lower court denied HOA owner’s request for fees.

               Aside from a deficient record and untimely augmentation request (issues that appellate attorneys would be keen on), the appellate court found that neither side prevailed in this case, finding that Hsu v. Abarra “prevailing party” principles applied under the Davis-Stirling Act fee-shifting statute.  HOA dismissed its complaint, and HOA owner did not prevail on his cross-complaint, such that the denial of fees was proper.

Appeal Sanctions, Costs, Family Law: Although Prevailing Party On Appeal Entitled To Costs, There Was No Bases For Appeal Attorney’s Fees Or Appellate Sanctions

Sanctions Award Under Family Code Section 271 Was Defective Because Prevailing Party Failed To Give Notice Of Seeking This Relief.

               In Marriage of Terry, Case No. B334907 (2d Dist., Div. 6 Apr. 21, 2025) (unpublished), a prevailing party on appeal was awarded three components by the lower court:  (1) routine costs; (2) $23,587.20 in attorney’s fees on appeal (with no explanation); and (3) $2,340 in sanctions under Family Code section 271 for preparing and attending a hearing on these various issues.

               The 2/6 DCA affirmed the routine costs award, but it reversed the (2) and (3) components.

               Prevailing party timely filed a costs memorandum such that routine appellate costs were properly awarded.

               The problem with the appellate fees award was there was no contractual or statutory basis for a fee award, because prevailing party cites no substantive grounds to support a fee award in this marital dissolution case—a reversal as a matter of law. 

               With respect to sanctions, the appellate court concluded that prevailing party never raised section 271 as a basis for fees before the trial court—instead just claiming they fell within routine costs (although one needs an independent fee basis anyway).  So, the other side was given no opportunity to contest this issue, requiring another reversal as a matter of law.

Family Law: A Remand Is Required Where Family Law Judge Awarded Wife Needs-Based Fees Over The Requested Amount

Financial Need Analysis Needed To Be Fine Tuned.

               In Marriage of Hernandez, Case No. G062386 (4^th Dist., Div. 3 Apr. 17, 2025) (unpublished), Justice Delaney on behalf of a 3-0 panel reversed and remanded a $7,500 needs-based fee award to ex-wife when her attorney only said he charged her a flat $5,000.  The ultimate award could not be reconciled, although the matter was remanded to do a restudy of whether financial needs of the parties drove the result in some way. 

Costs: Appellate Court Rejects Argument That Confidentiality of Medical Information Act Precludes Award Of Costs To Prevailing Defendant

Appellate Panel Found No Prejudice For Premature Costs Memorandum Filing and Affirms Most Awarded Costs To The Defense.

               Doe v. Santa Cruz-Monterey-Merced Managed Medical Care, Case No. H051821 (6^th Dist. Apr. 17, 2025) (unpublished) is a situation where a defendant obtained summary judgment against plaintiff on a Confidentiality of Medical Information Act (Civ. Code, §56) claim.  Defendant filed a costs memorandum for recovery of routine costs, which the lower court granted after taxing certain costs such that the ultimate award was $19,065.72.

               Plaintiff appealed on three grounds, losing two and gaining some minor traction on the third.

               The initial argument that the premature filing of the cost memorandum was infirm was found unpersuasive, because it is a mere irregularity and there was no prejudice because the lower court did conduct a hearing on the cost issues.

               The second argument was that the CMIA does not allow recovery of costs to a prevailing defendant because the statute only mentions recovery of fees and costs to a prevailing plaintiff.  The appellate court rejected this argument because nothing in the CMIA disallows recovery of costs to the defense, relying on analogous reasoning from the California Supreme Court’s Murillo opinion in reaching that conclusion.

               Finally, the appellate court sustained the lower court awarding these costs: (1) videotaping depositions; (2) eCheck fee added to electronic filing charges; (3) remote appearance notice filing fees; (4) electronic filing fees charged by a third-party provider; (5) discovery motions; and (6) withdrawn motions.  However, it did reduce the costs award a little more by finding that a Portland attorney saying she had a San Francisco office should not have garnered deposition travel and meal expenses to the Bay Area office, as well as finding that electronic serving of document costs were merely convenient rather than necessary to the litigation.

Allocation, Civil Rights: Plaintiff Prevailing on a Bane Act Claim Awarded $829,702.50 In Attorney’s Fees

Although She Was Unsuccessful On Some Claims, The Work Was Interrelated Such That Neither Allocation Nor A Further Reduction Was Required.

               In Gonzalez v. County of Fresno, Case No. F086776 (5^th Dist. Apr. 16, 2025) (unpublished), plaintiff recovered on a Bane Act claim (which has a fee-shifting statute), even though she failed to recover on some theories and two other plaintiffs were unsuccessful on the civil rights claims.  The jury awarded her $500,000 against three defendants.  She then moved for attorney’s fees of a little over $1.659 million inclusive of a 2.0 multiplier.  The lower court awarded her $829,702.50,

               Defendants’ challenges on appeal—that her work in related federal litigation and her partial lack of success required a further reduction—were rejected by the appellate court.  Under the abuse of discretion standard, the federal work was related to the state court work, and plaintiff’s work on unsuccessful claims was related to work on successful ones, with no apportionment being required.  The Fifth District panel also rebuffed the defense suggestion that the lack of success by other plaintiffs should be used for purposes of gauging her success. 

Fees As Damages: Fees Properly Awarded As Damages To Prevailing Party In A Slander Of Title Action

Routine Costs Were Also Awarded, No “Double Dip.”

               In California State Grange v. San Louis Obispo Guild Hall, Case No. B326399 (2d Dist., Div. 6 Apr. 15, 2025) (unpublished), among other issues, the appellate court affirmed an award of fees as damages to a prevailing party on a slander of title claim.  Fees and costs necessary to clear title or remove a doubt cast on it by defendant’s falsehood are proper pecuniary damages for purposes of a slander of title cause of action.  (Summer Hills Homeowners’ Assn., Inc. v. Rio Mesa Holdings, LLC, 205 Cal.App.4^th 999, 1030 (2012).)  The panel rejected the argument that it had to be determined at a trial, because a noticed motion procedure is the equivalent of a trial on this issue.   Finally, an award of routine costs was no “double dip” because it was separate from the fees recovered as damages.

Arbitration, Special Fee Shifting Statutes: Plaintiff/Former Client Failed To Timely Reject The Award By Filing An Action After Service Of The Award And Failed To Timely Move To Vacate The Award

MFAA Deadlines Are Strict, Not Subject To CCP § 473 Relief.

               Plaintiff/former client in Rossi, Hamerslough, Reischl & Chuck v. Shah, Case No. H051614 (6^th Dist. Apr. 11, 2025) (unpublished) was unhappy that her former counsel sent an outstanding $200,000 receivable notice even though they were instrumental in working up a case resulting in a verdict through replacement counsel and in an award of $395,000 in prevailing party fees against the verdict losing party.  She initiated Mandatory Fee Arbitration Act (MFAA) proceedings, even though no lawsuit was pending, aside from initiating JAMS arbitration to adjudicate her malpractice claims (although she later dropped the JAMS demand).  The MFAA panel sided with her former counsel, ordering the entire receivable paid. 

               Plaintiff failed to reject or file a new action within 30 days service of the award, a deadline which is not subject to CCP § 473 relief, in a situation where there was no action pending by former counsel.  She also failed to request a vacatur of the award within 100 days of award service, with former counsel waiting for that deadline to pass before moving to confirm the MFAA award.

               Plaintiff’s appeal of the results was unsuccessful. The appellate court found that the missed deadlines where critical and dispositive of her challenges for a revisit of the results.  The panel also did look at the denial of a new trial request on the merits (because the lower court did entertain it on the merits), but it found no prejudice flowing from its denial.  The moral of this case is to follow the MFAA and California Arbitration Act deadlines for getting a second bite from an adverse MFAA award or for challenging an arbitration award if that is the only remedy remaining.

Private Attorney General: $5,265,265.20 CCP § 1021.5 Fee Award Affirmed On Appeal

Case Involved San Francisco Penalty Refunds Of $1.7 Million Which Were Affirmed In A Prior Published Opinion.

               Plaintiffs in Gajanan, Inc. v. City & County of San Francisco, Case No. A168328 (1^st Dist., Div. 2 Apr. 10, 2025) (unpublished) sued defendants to obtain tax penalty refunds in a case under San Francisco regulations, eventually winning tax refunds of $1.7 million which were affirmed in a prior published opinion.  San Francisco later passed regulation amendments which were beneficial after the adjudication of plaintiffs’ lawsuit.  Plaintiffs then moved to recover $7,051,644 ($4,684,931 lodestar with some upper adjustments and discounts, and an ask for a 1.4 multiplier based on the contingency risk taken on by plaintiffs’ attorneys).  City argued the fee award should be $2.1 million.  After some very contested hearings involving a lengthy, detailed fee submission, the lower court awarded plaintiffs $5,265,265.20 under the private attorney general statute, CCP § 1021.5.

               The 1/2 DCA affirmed the award.  It agreed that plaintiffs vindicated an important right for Bay Area taxpayers in obtaining a broader interpretation of the standard for tax penalty waivers, with publication of the prior appellate opinion being probative on the issue.  Also, the panel concurred with the lower court’s assessment that plaintiffs’ suit was a catalyst for the subsequent beneficial regulatory amendments.  Private enforcement was necessary given the narrower stance taken by defendants on the penalty issue, and the actual costs of the litigation showed that the costs/benefit analysis favored plaintiffs.  The interest of justice factor under section 1021.5 did not support paying fees out of plaintiffs’ recovery.

               The attacks on the amount of the award were rejected also.  Although out-of-state Denver attorneys did less than 5% of the work on an overflow basis, this was not a disqualifying factor for those hours because plaintiffs had a California lead attorney supervising the case and actively involved in the matter.  The defense’s complaint about deposition preparation and 3 attorneys being at a deposition was found unpersuasive under the circumstances of the case, where City took 21 depositions and plaintiffs took 6.

Finally, 812 hours for “fees on fees” work was found warranted given the detailed nature of the fee submissions and the need to reply/file supplemental papers in response to the City’s opposition.

               BLOG BONUS COVERAGE:  City asked that plaintiffs’ supplemental declarations be stricken, a request denied by the lower court.  The appellate court reminded practitioners that they should ask for a continuance and permission to respond to supplemental declarations rather than just ask that those declarations be stricken—otherwise, waiver may come into play.

Civil Rights, Costs: Failure To Consider Plaintiff’s Financial Position In FEHA Costs Award Led To A Reversal

Other Items Also Had To Be Revisited.

               In the FEHA area, if appropriately raised, lower courts must take into account plaintiff’s financial situation in making a costs award against a non-prevailing FEHA plaintiff even where plaintiff’s case was deemed frivolous.  The lower court did award costs against the plaintiff, finding indigency was irrelevant in a FEHA case.  The Court of Appeal reversed in Ross v. Trustees of Cal. State University, Case No. B318731 (2d Dist., Div. 8 Apr. 7, 2025) (unpublished) because indigency is a factor to be considered.  Once that was recognized, the appellate court also questioned certain other routine costs which were granted but appeared suspect on appeal.  But we would surmise the indigency ground for reversal led the parade on the revisit of other costs in this appellate opinion.

Civil Rights, Costs: Lower Court’s Award Of Costs Against Dismissing FEHA Plaintiff Reversed As A Matter Of Law.

No Indication Case Was Frivolous.

               We have posted on an emerging trend in FEHA cases, which is that routine costs cannot be assessed against a non-prevailing plaintiff unless the case is deemed frivolous. Vanrooy v. Jacobes-Downing-Hughes, Inc., Case No. C100312 (3d Dist. Apr. 7, 2025) (unpublished) is a continuation of that theme.  There, plaintiff’s claims were dismissed for failure to serve a complaint within the three-year mandatory service period, with the lower court awarding routine costs.  The costs award was reversed on appeal because nothing indicated that plaintiff’s case was frivolous or that costs could be apportioned between FEHA and non-FEHA claims. 

Class Actions: 2025 Carlton Fields Class Action Survey Recently Issued

Survey Shows Increases In Class Action Case Numbers, Corporate Litigation Budgets Spent On Class Actions, And In-House Counsel Time Spent On Them, With Labor/Employment And Consumer Fraud Actions Leading The Class Action Pack.

               The 2025 Carlton Fields Class Action Survey, which is publicly available, has just been issued.  It has interesting trends for class actions, especially enlightening for class action defense attorneys and their clients.  Here are the highlights:

• • • Defense spending and the expected number of class actions hit a new record, a tenth straight year of growth. Spending on class actions accounted for 12.5% of corporate litigation budgets, surpassing $4 billion—up from 12.3% last year.
    • In-house counsel added the equivalent of one additional workday per week to manage class actions, with class action filings forecast to increase 20%.
    • Two-thirds of corporate counsel participating in the survey expect new class actions to arise after the use of generative AI.
    • Labor/employment and consumer fraud class actions are expected to lead the next class action wave.
    • Fewer companies use insurance to combat exposure to these cases, although they are implementing risk aversion techniques and many times are using mandatory arbitration clauses/class action waivers.
    • Companies settling class actions are asking for reversion clauses with respect to unclaimed settlement amounts, and cy pres features in settlement have dropped to zero recently.

Private Attorney General: Plaintiffs Properly Awarded Over $1 Million In Fees Under A Private Attorney General Catalyst Theory

Prelitigation Demand, Causation, And Primary Relief Elements Were Satisfied.

               Plaintiffs in San Diego Tenant Union v. San Diego Housing Comm’n, Case No. D081773 (4^th Dist., Div. 1 Mar. 28, 2025) (unpublished) sued defendant to force it to increase housing-assisted payments in wealthier neighborhood, advancing a perpetual segregation theory under FEHA, the Unruh Act, contractual breach under a HUD contract, and discrimination with respect to state-funded program.  Several years into the litigation, defendant voluntary increased payments in line with a HUD program, triggering plaintiffs to dismiss their action.  Both sides moved for fees and costs.  Plaintiffs obtained an award of $1,050,308.45 in fees and $4,691.31 in costs under a private attorney general catalyst theory.  In contrast, defendant’s requests were denied.  Defendant appealed.

               The 4/1 DCA affirmed, determining that the CCP § 1021.5 fees and costs award was proper under an abuse of discretion standard given the factual determinations which were made by the lower court.  Three arguments were raised, and they were resolved this way:  (1) the prelitigation demand requirement under Graham was satisfied by a letter and statements made in public hearings so as to put defendant on notice; (2) the lawsuit was a motivating catalyst because defendant did increase the payments based on inferences drawn from the evidentiary record; and (3) plaintiffs did obtain their primary relief because defendant did make a policy change during the course of the litigation.

Prevailing Party, Section 1717: Alter Ego Defendants Obtaining Dismissal Of Declaratory Relief Action Were Entitled To Attorney’s Fees Under A Fees Clause Between Plaintiff And The Signatory Defendant

$58,223 Was The Fee Award, With A Credit For Smaller CCP § 128.7 Sanctions.

               In ATM Professional, Inc. v. Repiping.com, Inc., Case No. B331046 (2d Dist., Div. 3 Mar. 26, 2025) (unpublished), alter ego defendants obtained a dismissal (based on failure to name an indispensable party, the contract signatory) in a declaratory relief complaint when the underlying contract had a fees clause.  The court awarded prevailing party fees of $58,223 to the successful alter ego defendants under Civil Code section 1717, even though the defendants granted a credit for a smaller CCP § 128.7 fees sanctions award.  Plaintiff’s appeal was unsuccessful because:  (1) a declaratory relief action is “on the contract” under Civil Code section 1717; (2) defendants were prevailing parties because they achieved their litigation objectives in obtaining a dismissal of the action; (3) no mediation condition precedents were unsatisfied because the claims were not directed at alter ego defendants; and (4) the assertion that fees were awarded for duplicative work was unsupported by specific objections to the requested fees. 

Sanctions: $200,000 CCP § 128.5 Sanctions Award Reversed Because It Was Not Causally Tethered To the Criminal Kidnapping Conduct At Issue

A Remand Was Ordered On The Civil Component And A Possible Penalty Payable To The Court.

               Talk about interesting issues; well, there was one considered by the 4/1 DCA in Razuki v. Malan, Case No. D082560 (4^th Dist., Div. 1 Mar. 20, 2025) (unpublished).

               There, plaintiff was assessed with a $200,000 sanctions award under CCP § 128.5 for his conduct in trying to kidnap defendant several months after the civil lawsuit was filed.  Although determining that criminal conduct could be sanctionable under section 128.5, the appellate court reversed because the evidence did not show that the awarded amount was causally tethered to the criminal conduct at issue.  In the end, the matter was remanded to revisit the sanctions amount to be awarded to defendant plus a possible penalty payable to the court under the sanctions statute (with the court penalty not having to be causally related to the underlying conduct). 

Cases Under Review, Section 998: California Supreme Court Decides That CCP § 998 Costs-Shifting Applies To Pre-Trial Settlements

. . . Although The Parties Are Free To Allocate Costs Differently Under Their Settlement.

               The California Supreme Court in Madrigal v. Hyundai Motor America, Case No. S280598 (Cal. Sup. Ct. Mar. 20, 2025) (published) decided that CCP § 998 offers do apply to pretrial settlements, rather than just judgments or arbitration awards, for purposes of cost-shifting, although the parties can allocate things differently under their settlement.  Our state high court placed a lot of primacy on the section 998 underlying principles to encourage settlements. 

Reasonableness Of Fees: 2/3 DCA Reverses An 82% Reduction In A FEHA Fee Request, Primarily Based On Reconstructed Time, As An Abuse Of Discretion And As Not Adequately Explained

“Haircut” Was Too Much, Requiring A Remand Revisit.

               In the fee award area, the amount awarded is governed by an abuse of discretion standard.  However, large “haircuts” sometimes strike an appellate panel as too arbitrary, requiring a revisit.  That was the case in Guevara v. Interstate Meat Co., Inc., Case No. B332546 (2d Dist., Div. 3 Mar. 18, 2025) (unpublished).

               Plaintiff settled a FEHA case, 18 months into the matter, for $25,000.  Plaintiff sought over $153,000 in fees based on some reconstructed time and without detailed time substantiation in some respects.  The trial court was troubled by the reconstructed time, allowing for none of it, thought the claimed hourly rates were excessive, and believed the fee request was excessive.  It reduced the fee request by 82%, awarding $27,500 in fees.

               The 2/3 DCA reversed, reasoning this way: (1) it was an abuse of discretion to reject reconstructed time outright; (2) the justices were not convinced that the explanation of the reduction sufficed, relying on the Kerkles and Gorman opinions which also involved substantial fee request reductions; and (3) the trial judge’s order did not show why he reduced plaintiff’s counsel’s hourly rates when the plaintiff’s showing was uncontested.

So, the matter was remanded for a revisit and a better explanation for any fee “haircut.”

Fee Clause Interpretation: Where Pleadings And Testimony Showed That A Brochure With A Fees Clause Applied To Services Different Than The Ones In Dispute, Trial Judge’s Conclusions That The Two Transactions Were Not Integrated Supported A Denial Of Fees

The Pleadings And Trial Testimony Supported That Result.

               Plaintiff restoration company won a $452,422 jury verdict against defendant apartment owner for water restoration services, then moving to recover $260,215 in attorney’s fees based on a fees clause in a prior brochure involving different apartment turn services which were paid off by apartment owner.  The lower court found that the pleadings and trial testimony showed the transactions were not the same, so the integration principle contained in Civil Code section 1642 was not viable, denying fees to the restoration company.

               The appellate court affirmed in Prestige Construction and Renovation Services, Inc. v. Reliant Real Estate Management, Inc., Case No. D084506 (4^th Dist., Div. 1 Mar. 18, 2025) (unpublished).  The integration question was one of fact, with substantial evidence showing the brochure fees clause did not apply to the later water restoration services resulting in the jury verdict.  Because there was no agreement with a fees clause (R.W.L. Enterprises v. Oldcastle, Inc., 17 Cal.App.5^th 1019, 1022, 1028 (2017)), the fee denial was warranted. 

Mediation: Lis Pendens Exception To Seeking Mediation Before Filing Suit Resulted In Reversal Of A Denial Of Attorney’s Fees As To A Prevailing Party Trust In A Real Estate Purchase Agreement Dispute

Another Individual Plaintiff Who Prevailed Properly Denied Fees Because He Brought No Fee Motion.

               In Trapp v. Maham Group, Case No. E081888 (4^th Dist., Div. 2 Mar. 17, 2025) (unpublished), individual plaintiff and a trust plaintiff affiliated with the individual won specific performance suits against defendants for breaching lease and purchase agreements giving plaintiffs a right of first refusal to buy the property being leased.  The purchase agreement had an attorney’s fees clause with mediation condition precedent language, but with an exception for a suit filed to enable recordation of a lis pendens.  The parties unsuccessfully went to a court-mediation after the suits were filed.  Trust filed a fee motion as prevailing party for $116,961.25.  The trial judge denied the fee request because he did not believe the court-ordered mediation was compliant with the condition precedent language in the fees clause.

               The 4/2 DCA reversed the fee denial as to the trust.  It found that trust had filed a lis pendens concurrently with its complaint, so the lis pendens exception did apply.  (Blackburn v. Charnley, 117 Cal.App.4^th 758, 768 (2000).)  The matter was remanded to have the fee motion granted and have the trial judge determine the appropriate amount of fees to be awarded to trust.    

               Individual plaintiff claimed he was entitled to fees also, but his failure to file a motion to recover attorney’s fees was fatal to his argument on appeal.

Ethics, SLAPP: Fees Award, After Previous SLAPP Grant Reversal, Had To Be Reversed

… But Plaintiff’s Uncivil Remarks In Appellate Briefing Led The Court Of Appeal To Deny It Costs On Appeal.

               Incivility is a recurring theme by trial and appellate courts.  This opinion is one that, yet again, reinforces that attorneys should refrain from making attacks against opposing counsel and the trial judge.

               In WasteXperts, Inc. v. Arakelian Enterprises, Inc., Case No. B327712 (2d Dist., Div. 4 Mar. 14, 2025) (unpublished), plaintiff obtained a reversal of a SLAPP grant, although the prior opinion did chastise plaintiff for making distracting and unsupported attacks on opposing counsel and the trial court.  Plaintiff appealed to obtain a reversal of a $175,000 fees and $767.65 costs award in favor of defendant.  The defense did not contest the reversal of that cumulative award based on the SLAPP merits reversal.  However, it did contest that costs on appeal should be awarded to plaintiff based on renewed uncivil remarks against opposing counsel and the trial judge.

               The appellate court agreed, denying costs of appeal to plaintiff.  Incivility permeated their appellate briefing such that it was appropriate to not award appellate costs to plaintiff, as the defense suggested. 

SLAPP, Sanctions: $73,405 Fees And $1,351 Costs Awards Affirmed In Favor Of Plaintiff Where Defendant Made A Frivolous SLAPP Motion

Appellate Court Agreed That Plaintiff Did Not Have An Opportunity To Comply With CCP § 128.5 Safe Harbor Sanctions Provision, But Indicated It Should Be Followed Absent Exceptional Circumstances.

               In Chang v. Brooks, Case Nos. B320278 et al. (2d Dist., Div. 3 Mar. 14, 2025) (unpublished), defendant’s SLAPP motion was determined to be properly denied by the lower court, and the lower court's $73,405 fees and $1,351 costs awards to plaintiff, based on the perception that the defense SLAPP motion was frivolous in nature, were affirmed on appeal.

               The defense’s primary argument was that plaintiff failed to comply with the CCP § 128.5 21-day safe harbor provision, because the court in Zarate v. McDaniel, 97 Cal.App.5^th 484 said this was the general rule given its disagreement with broader language in Changsha Metro Group Co., Ltd. v. Xufeng, 57 Cal.App.5^th 1, 19-23 (2020) with respect to a SLAPP motion arguing fees should be awarded because the defense motion was frivolous.  However, based on the circumstances notwithstanding the general rule, the Chang court agreed that plaintiff had no real opportunity to provide the safe-harbor notice such that the fees and costs award was appropriate under the circumstances—Xufeng was good law for this one.

SLAPP: Seven Defendants Properly Awarded $683,417.50 In SLAPP Fees And Costs

However, They Did Not Get Their Request of $1.9 Million In Fees.

               In Six4Three, LLC v. Facebook, Inc., Case Nos. A166007/A167416 (1^st Dist., Div. 4 Mar. 12, 2025) (published), seven defendants prosecuted a prior appeal which resulted in the lower court’s granting of SLAPP motions and the later awarding of $683,417.50 in fees and costs to the prevailing defendants.  The fees/costs awards were affirmed, even though defendants had requested $1.9 million and plaintiff had argued only $357,000 was warranted as a cumulative award.

               The principal issue on appeal was whether fees were allowable for prior appellate work and a motion to seal proprietary information.  Because these activities did lead to the granting of the SLAPP motions, that work was “incurred in connection with” the SLAPP motions such that the time was recoverable under the fee shifting statute.