March 2022 Update
Eligibility and Entitlement to Fees
In Leiper v Gallegos (2021) 69 CA5th 284, the court of appeal held that a self-represented attorney could not recover fees under a common fund theory, following Bruno v Bell (1990) 91 CA3d 776. See §2.20.
The California Supreme Court has granted review in Travis v Brand (review granted June 23, 2021, B298104, B301479; opinion at 62 CA5th 240 to remain published and citable until further order), in which the Second District, Division Eight held that prevailing defendants under the Political Reform Act were entitled to fees on the same terms as plaintiffs, reasoning that election law cases are more like ordinary civil litigation than civil rights cases and should be governed by the standards for business cases. The court of appeal further held that fees may not be awarded against nonparties absent adequate notice. See §§2.41, 2.50, 3.85.
In Champir, LLC v Fairbanks Ranch Ass’n (2021) 66 CA5th 583, the court of appeal articulated the standard for awarding fees in cases brought under the Davis-Sterling Common Interest Development Act, using the same prevailing-party analysis employed by the California Supreme Court for CC §1717 cases in Hsu v Abbara (1995) 9 C4th 863. See §§2.45, 3.103.
In Oakes v Progressive Transp. Servs. (2021) 71 CA5th 486, the court of appeal held that an award of costs to defendant under CCP §998 takes precedence over the distribution priorities in Lab C §3856 (including an employer’s right to subrogation for compensation paid to an employee injured by a third party). See §§2.78, 5.27.
In Moreno v Bassi (2021) 65 CA5th 244, the court of appeal held that an employee prevailing on minimum wage or overtime claims that do not exceed $300 is entitled to reasonable attorney fees under Lab C §1194, not to 20 percent of the recovery provided under Lab C §1031. With respect to costs, Moreno also held that the plaintiff, who recovered $32 on her Labor Code claim but lost her FEHA claim, was entitled to all costs except those pertaining “solely” to her unsuccessful FEHA claim. See §§2.9, 2.47, 2.78, 8.22.
In Felczer v Apple, Inc. (2021) 63 CA5th 406, the court held that under the Enforcement of Judgments Law, postjudgment interest on an award of statutory attorney fees accrues from the date entitlement to fees is established, even if it is not quantified until later. Interest on routine costs accrues from the date of the merits judgment for the payment of money because that judgment establishes entitlement to costs. See §§9.132, 9.133.
Labor Code §218.8, effective January 1, 2022, authorizes prevailing party fees in an enforcement action against a direct contractor whose subcontractor fails to pay its employees, including in a civil action by a third party owed benefit contributions on the employee’s behalf. See §3.97.
The California Supreme Court granted review in Pulliam v HNL Automotive, Inc. (review granted on other grounds Apr. 28, 2021, B293435; opinion at 60 CA5th 396 to remain published and citable until further order) to resolve a split of authority on the issue of whether the Holder Rule, which limits the recovery of attorney fees in consumer cases, was abrogated by the California Legislature’s enactment of CC §1459.5. See §3.104.
The California Supreme Court held in Pollock v Tri-Modal Distribution Servs., Inc. (2021) 11 C5th 918 that a prevailing employer in a FEHA action cannot recover costs on appeal without a finding that the underlying claim was objectively groundless. See §9.34.
In Reck v FCA US LLC (2021) 64 CA5th 682, the court of appeal held that in the context of public interest litigation with a mandatory fee-shifting statute such as the Song-Beverly Act, it is an error of law for the trial court to categorically deny or reduce an attorney fee award on the basis of a plaintiff’s failure to settle when the ultimate recovery exceeds the defendant’s CCP §998 settlement offer. See §§9.3, 10.59.
In Champir, LLC v Fairbanks Ranch Ass’n (2021) 66 CA5th 583, the court of appeal explained that the prevailing party under a mandatory fee-shifting statute is entitled to attorney fees as a matter of right and the trial court is obligated to award attorney fees whenever the statutory conditions have been satisfied. See §2.75.
In City of Norco v Mugar (2020) 59 CA5th 786, the court of appeal held that the trial court was well within its discretion in finding that under CCP §1021.5, the litigation served as a catalyst for the city achieving its objective, which was to abate a public nuisance. See §2.111.
In Early v Becerra (2021) 60 CA5th 726, the court of appeal held that Attorney General Becerra enforced important rights by obtaining an appellate opinion interpreting Govt C §12503 to defeat a claim that the statute precluded him from running for office; the court reaffirmed that election rights that transcend the candidate’s stake in the election are important rights under CCP §1021. See §§3.4, 3.19, 3.46.
In Doe v Westmont College (2021) 60 CA5th 753, the court of appeal vacated a denial of fees under CCP §1021, holding that the trial court improperly based its denial on the difficulty of apportioning private and public interests, and improperly focused on avoiding punishing the defendant rather than evaluating the financial burden on the successful party as the statute requires. See §§3.7, 3.31, 3.45.
In Burgess v Coronado Unified Sch. Dist. (2020) 59 CA5th 1, the court of appeal held that the significant benefit component of CCP §1021.5 requires more than a mere statutory violation. The trial court correctly held that an intervener in a reverse-CPRA suit is not entitled to attorney fees; rather, the intervenor is limited to seeking fees under CCP §1021.5 when it meets all eligibility criteria. See §§3.46, 3.51, 3.87.
In Schoenberg v FBI (9th Cir 2021) 2 F4th 1270, the Ninth Circuit held that the district court properly denied fees to a prevailing plaintiff after finding that the legal reasonableness of withholding information requested under the Freedom of Information Act outweighed the public benefit, plaintiff’s commercial benefit, and the nature of plaintiff’s interest in obtaining the information. See §§2.87, 3.129.
Fee Awards Based on Contractual Fee Clauses
In Hom v Petrou (2021) 67 CA5th 459, the court held that nonsignatories to a commercial lease were entitled to attorney fees as third party beneficiaries when they prevailed in a dispute involving both tort and contract claims. The court also held that CC §1717(b)(2) did not bar an award of fees after settlement because the lease’s fees provision was broad enough to cover noncontract claims, and the losing party failed to request apportionment of fees between the contract and noncontract claims. See §§4.43, 4.30, 4.84.
In Domestic Linen Supply Co. v L J T Flowers, Inc. (2020) 58 CA5th 180, the court of appeal held that the contract clause authorizing fees against a party that “breached the agreement” should be interpreted to apply to a defendant who defeated plaintiff’s breach of contract claim under CC §1717. See §§4.10, 4.21, 4.51.
Attorney Fees Awarded as Sanctions
In America Unites for Kids v Rousseau (9th Cir 2021) 985 F3d 1075, 1092, the Ninth Circuit held that the district court could not sanction plaintiffs for discovery misconduct by striking their prayer for statutory attorney fees, expert witness fees, and costs without applying Goodyear’s but-for standard of causation. Furthermore, denial of fees under statutes intended to advance the public interest, such as the Toxic Substances Control Act, is permitted only under “special circumstances” and therefore is extremely rare. See §2.53, 6.55.
Methods of Calculation
In Amaro v Anaheim Mgmt., LLC (2021) 69 CA5th 521, a common fund case, the court did a lodestar check and approved a 25.9 percent fee award as “in line” with a lodestar-based fee reflecting a 1.1 multiplier. The court noted that fee awards in class actions average around one-third of the recovery regardless of whether the percentage method or the lodestar method is used. The court also held that time spent seeking court approval of the class action settlement was properly included in the lodestar cross-check. See §§8.12, 8.15, 9.9.
Determining the Lodestar
In Karton v Ari Design & Constr., Inc. (2021) 61 CA5th 734, the court of appeal held that the trial court may properly consider whether the attorney seeking fees has become “personally embroiled” and “over-litigated the case,” and whether the attorney’s incivility in the litigation has affected the litigation costs. See §9.4.
In Early v Becerra (2021) 60 CA5th 726, the court of appeal rejected the plaintiffs’ claim that the trial court awarded the defendant compensation for “excessive” fee motion work, noting that the plaintiffs had “vigorously opposed the fees motion,” which raised interesting and arguably novel issues concerning the application of CCP §1021.5 to the facts of the case. See §9.20.
In State Farm Gen. Ins. Co. v Lara (2021) 71 CA5th 197, the court of appeal held that an award of “fully compensatory fees” includes work on unsuccessful arguments. The court also rejected a claim that a successful intervenor’s work duplicated work performed by others. See §§9.53, 9.73.
In Los Angeles Unified Sch. Dist. v Torres Constr. Corp. (2020) 57 CA5th 480, the court of appeal rejected a fee challenge based on counsel’s heavily redacted billing statements, reasoning that the trial court knew what the litigation required and took duplication objections into account in assessing the number of compensable hours. The court also noted that the fee opponent had the entire record of the case and could have hired an expert to challenge the number of hours spent. See §§9.85, 9.91.
In Pasternack v McCullough (2021) 65 CA5th 1050, the court of appeal noted that a trial court has discretion to award an hourly rate under the lodestar method that exceeds the rate that was actually incurred or paid, holding that a prevailing party is not limited to rates actually paid by its insurer. See §§9.97, 9.109, 9.123.
In Chambers v Whirlpool Corp. (9th Cir 2020) 980 F3d 645, the Ninth Circuit held that neither the lodestar nor the multiplier can reflect work done for the coupon portion of the relief in a coupon class action. See §§10.25, 10.26, 10.29, 10.45.
In Frias v City of Los Angeles (CD Cal, Apr. 23, 2020, No. CV 16–4626 PSG (SKx)) 2020 US Dist Lexis 129936, the district court awarded fees under CC §52.1 in a case that was also brought under 42 USC §1988. The court of appeal affirmed a 1.5 multiplier based in part on case difficulty and counsel’s demonstrated skill and approved a rate for lead counsel based on the Real Rate Report Third Quartile rate for litigation partners, plus $200 per hour because the attorney was at the top of his field. See §§2.11, 3.83, 9.121, 10.36.
New cases have been added throughout the text on the issue of compensable hours. See, e.g., Amazon.com, Inc. v Personalweb Techs., LLC (In re Personalweb Techs., LLC) (ND Cal, Mar. 2, 2021, Nos. 18–md–02834–BLF, 5:18–cv–00767–BLF, 5:18–cv–05619–BLF) 2021 US Dist Lexis 39062 (rejecting challenges to billing for rejected challenges to numerous categories of work, including “Case Management” time, “top-heavy staffing,” numerous attorneys at meetings, and two attorneys at depositions); Herring Networks, Inc. v Maddow (SD Cal, Feb. 5, 2021, No. 3:19–cv–1713–BAS–AHG) 2021 US Dist Lexis 23163 (rejecting reductions for use of two partners and failure to employ “pyramid” staffing but imposing 5 percent reduction for conferencing); Frias v City of Los Angeles (CD Cal, Apr. 23, 2020, No. CV 16–4626 PSG (SKx)) 2020 US Dist Lexis 129936 (compensating time spent by legal assistant for “organizing discovery materials and other evidence, preparing trial materials, and deposition logistics”); Planned Parenthood Fed’n v Center for Med. Progress (ND Cal, Dec. 22, 2020, No. 16–cv–00236–WHO) 2020 US Dist Lexis 241035 (rejecting hours spent by in-house counsel that duplicated outside counsel or reflected “typical” in-house tasks). See §§9.8, 9.9, 9.76, 9.110, 9.119.
Adjustments to the Lodestar
In Chambers v Whirlpool Corp. (9th Cir 2020) 980 F3d 645, the court of appeal rejected a 1.68 multiplier in a coupon class action because the district court incorrectly included the value of the coupon portion of the settlement in establishing the multiplier. The court also rejected an enhancement for contingency risk when the settlement provided that the defendant would directly pay the fees rather than having them paid from the common fund. See §§10.2, 10.26, 10.29, 10.45.
In Pulliam v HNL Automotive, Inc. (review granted on other grounds Apr. 28, 2021, B293435; opinion at 60 CA5th 396 to remain published and citable until further order), the court of appeal affirmed a 1.2 multiplier based on contingent risk and on the fact that defense counsel’s litigation tactics complicated the case and made what could have been a simple case into a difficult one. See §§10.41, 10.42, 10.73.
In Reck v FCA US LLC (2021) 64 CA5th 682, the court of appeal held that a CCP §998 offer may be considered along with other factors when determining whether to adjust the lodestar for degree of success. See §10.53.
In Sonoma Land Trust v Thompson (2021) 63 CA5th 978, a partially contingent action to enforce a conservation easement, the court of appeal concluded that no reduction to the fee award was required when the prevailing party’s fees were partially paid by an insurance company. The court affirmed a 1.4 multiplier for skill and novelty/difficulty, as they were not fully reflected in the lodestar; the multiplier would have been justified by contingent risk alone. The court noted counsel’s 10 percent voluntary reduction and cited the supporting expert’s opinion that the fee request was reasonable in light of opponents’ aggressive tactics. See §§2.24, 10.5, 10.8, 10.31, 10.37, 10.41–10.42, 10.73.
Claiming and Opposing Trial Court Fees
In Sonoma Land Trust v Thompson (2021) 63 CA5th 978, the court of appeal rejected the fee opponents’ claim that the award to plaintiff was “excessive”: “It is not enough to cherry-pick examples of attorney missteps or to dismiss a case as easy, in hindsight, after nearly five years of contentious litigation and a 19-day trial.” The defendants failed to point to any charges that were improper and did not explain what the lodestar should be or how it should be calculated. See §11.59.
In Kim v Allison (9th Cir 2021) 8 F4th 1170, the Ninth Circuit held that the district court abused its discretion in approving a settlement, including fees, by materially underrating the strength of plaintiff’s claims, substantially overstating the settlement’s worth, and failing to take the required hard look at any indicia of collusion, including a clear-sailing provision and a fee award that dwarfed the anticipated monetary payout to the class. See also Briseño v Henderson (9th Cir 2021) 998 F3d 1014, 1024. See §11.17.
In In re Wells Fargo & Co. Shareholder Derivative Litig. (ND Cal 2020) 445 F Supp 3d 508, aff’d (9th Cir 2021) 845 Fed Appx 563 (unpublished opinion), the district court rejected the plaintiffs’ claim for higher contract attorney rates because they failed to present an expert to determine a true market rate for contract attorneys. See §§9.120, 9.121.
In Planned Parenthood Fed’n v Center for Med. Progress (ND Cal, Dec. 22, 2020, No. 16–cv–00236–WHO) 2020 US Dist Lexis 241035, the district court concluded that the hours sought by plaintiffs were reasonable based on declarations by each billing attorney attesting to tasks performed and hours per task; production of the underlying timesheets was not required. See §9.87.
Fees Awarded for Administrative Proceeding
In State Farm Gen. Ins. Co. v Lara (2021) 71 CA5th 197, 214, the court comprehensively reviewed entitlement to fees under Ins C §1861.10(b) (fees for parties who represent interests of consumers and make “substantial contribution” to decision of insurance commissioner or court) and concluded that the statute requires “a significant, distinct contribution, but not more.” The court distinguished the more stringent standards for PUC awards and prevailing party statutes like CCP §1021.5. See §§2.44, 13.6.
Fees for Work in Arbitration
There is a continued split of authority on the issue of whether a party who files a successful petition to compel arbitration as required by contract is entitled to fees under CC §1717 as to the proceedings on the petition to compel, regardless of the arbitration’s outcome. In Domestic Linen Supply Co. v L J T Flowers, Inc. (2020) 58 CA5th 180, the court of appeal held that a defendant who defeated an independent action to compel arbitration on the grounds that the arbitration clause was invalid was properly awarded contractual fees, distinguishing Frog Creek Partners, LLC v Vance Brown, Inc. (2012) 206 CA4th 515. See §14.20.
In Patterson v Superior Court (2021) 70 CA5th 473, the court of appeal held that under FEHA an employer is not entitled to attorney fees following a successful petition to compel arbitration unless the employee’s opposition to the motion was groundless. See §3.82.
Appellate Review of Fee Orders
In Doe v Westmont College (2021) 60 CA5th 753, the court of appeal held that an order denying post-judgment appellate fees is appealable even though an earlier order denying pre-judgment fees was not appealed. See §16.10.
In Pulliam v HNL Automotive, Inc. (review granted on other grounds Apr. 28, 2021, B293435; opinion at 60 CA5th 396 to remain published and citable until further order), the court of appeal held that defendants waived their challenge to declarations of plaintiff’s counsel in support of fees because they failed to make specific arguments about each evidentiary objection made in the trial court or to provide legal support for their position. See §11.60.
In Sonoma Land Trust v Thompson (2021) 63 CA5th 978, the court of appeal affirmed the trial court’s decision not to reduce a fee award because the decision was not “inscrutable” and did not appear to have been “plucked from the air.” See §11.68.
In Reck v FCA US LLC (2021) 64 CA5th 682, the court of appeal explained that the question whether the trial court selected the proper legal standards in making its fee determination is reviewed de novo. Although trial courts have broad authority in determining the amount of reasonable legal fees, an award can be reversed for an abuse of discretion when the court employed the wrong legal standard in making its determination. See §§1.12, 2.80, 10.23, 16.24, 16.29.
In AdTrader v Google (9th Cir 2021) 7 F4th 803, the Ninth Circuit held that an interim fee order was not collaterally appealable as an order effectively unreviewable on appeal because there was little risk that counsel’s right to fees would fail if not vindicated before judgment. See §§11.18, 11.44.
In Travis v Brand (review granted June 23, 2021, B298104, B301479; opinion at 62 CA5th 240 to remain published and citable until further order), the court of appeal held that nonparties against whom fees assessed have standing to appeal the fee order. See §16.12.
In Moreno v Bassi (2021) 65 CA5th 244, the court of appeal held that when different fee-shifting statutes overlap, the question of which statute applies to a specific case is determined de novo. See §16.17.