Archive for the ‘Attorney Fees’ Category

City’s pre-election challenge to initiative not a SLAPP

Monday, January 21st, 2008

(Bumped — note the comment from the attorney for the petitioner inviting amicus participation) 

Tackling the ever more difficult question of when a lawsuit “arises out of” protected activity, the Fourth District Court of Appeal ruled Friday that Riverside’s pre-election challenge to an initiative restricting the city’s power of eminent domain was not subject to special motion to strike under Code of Civil Procedure §425.16.

The proponent of the initiative (and defendant in the city’s suit) argued that filing an initiative with the city is protected activity under the First Amendment — that the right of petition was not completed until after the election.  The Court of Appeal disagreed, however.

“[A] court, in determining whether the anti-SLAPP statute applies, looks at whether a lawsuit arises out of protected activity, rather than a more fundamental dispute.  Above all, as we have already said, what matters is the basisfor the lawsuit; that the City filed its declaratory relief action [seeking a ruling that the initiative was invalid and could not be placed on the ballot] on the heels of the submission of the initiative is not dispositive.”

This may prove to be a difficult standard to apply in practice.  The first prong of a special motion to strike is a showing that the action “arises out of” protected activity.  If that is established, the burden shifts to the plaintiff to show likelihood of success on the merits.  In this case, there is no question that drafting an initiative and collecting enough signatures to place the measure on the ballot are “protected activities” for the purpose of the Anti-SLAPP law.  It also seems not subject to dispute that the cost of defending a lawsuit (in absence of pro bono assistance) is a costly matter — and the city could use the lawsuit as a means of precluding a vote and deterring future initiatives.  The distinction that court draws in this case, without resorting to an attempt to ferret out the subjective intent of the plaintiff, is to note that the suit arises not out of the First Amendment activities of drafting and qualifying an initiative, but rather the substantive legality of the initiative.

That analysis, however, seems to invite a blurring a distinction of the first and second steps of the section 425.16 analysis.  After all, one could argue that in many anti-SLAAP actions that the suit is really about the substantive illegality that forms the basis of the cause of action rather than the exercise of speech rights.   This is an area where further direction from the Legislature and the Supreme Court is necessary.

Two other points about this decision merit mention.  First, the initiative at issue apparently failed to qualify for the ballot and the court decided that the appeal was technically moot.  The court’s reasoning, stated in its order to the parties to brief the mootness question, was put this way:  The initiative failed to complete the process necessary for placement on the ballot.  Thus, validity of the initiative is no longer viable, which means the complaint is moot, in turn rendering moot the granting of the special motion to strike and this appeal.”

Does this mean that a plaintiff can escape liability for attorney fees on an anti-SLAAP motion if the action subsequently becomes moot?  Hasn’t the defendant already suffered the harm that the Legislature attempted to remedy with the fee award?

The second point is that the court noted that on remand, that “inasmuch as the City is now the prevailing party, upon motion in the trial court and a showing that respondents’ motion was ‘frivolous or [was] solely intended to cause unnecessary delay’ … the City may be entitle to attorney’s fees.”

I have wondered how one could show a motion to be “frivolous” if the trial court had initially granted the motion.  If you have convinced a court that the motion is legally correct, does that establish the motion was not frivolous as a matter of law?

Section 1988 Fees Need Not Be Proportional to Damages

Wednesday, January 9th, 2008

Litigating cases against government entities can be frustrating.  In some cases, it seems that a city or state agency will spare no expense in litigation to defend against a claim with the result that the cost of litigation will greatly exceed the damages awarded.  Successful civil rights claimants are entitled to attorney fees under 42 USC §1988, but the question is whether the attorney can get fairly compensated the time it took to litigate the claim.

The First District Court of Appeal recently issued a decision that will help litigants with this concern.  In Harman v. City and County of San Francisco, the city argued that a fee award of $1.1 million should be overturned since it was grossly disproportionate to the $30,000 in damages awarded by the jury.  The court ruled, however, that proportionality was not the legal standard against which to judge fee awards under section 1988. 

Instead or proportionality, the court bases a fee award under section 1988 on a lodestar calculation that includes time reasonably spent in pursuit of successful claims.  Time spent on tasks attributable to multiple claims need not be apportioned to account for success on only some of those claims — the standard is reasonableness of the time spent.

Similarly, a successful claimant may be awarded fees for unsuccessful claims where they are related to successful claims and the court finds a reasonable relationship between significance of the relief awarded and the hours expended on the litigation.  The amount of the damage award does not control this question:  “a slight monetary recovery will not control assessment of the appropriate amount of attorney fees where a constitutional right is vindicated or a significant public benefit conferred.”

One of the important lessons of this case is the difficulty in challenging an award of fees on appeal.  The standard of review is “abuse of discretion.”  Thus, although the Court of Appeal noted that had the question “been presented to us in the first instance, we may not have awarded attorney fees that so far exceed the recovery of damages,” the award by the trial court was not an abuse of discretion.  The appellate court took note of the fact that the trial judge that made this award “presided over the entire lengthy proceedings, including two remands,” and “handled this case for several years.”  In that situation, the appellate courts will be especially hesitant to disturb the trial court’s attorney fee award.

Congratulations to my former colleagues, Paul Beard and Sharon Browne at Pacific Legal Foundation, and my law school classmate, Andrea Miller of Nageley, Meredith, & Miller, for this outstanding victory.

Court OK’s 1021.5 Fees for Pre-Litigation Activities

Tuesday, January 8th, 2008

Unlike fees awarded under 42 USC §1988 for civil rights claims, the private attorney general attorney fees provision in California (Code of Civil Procedure §1021.5) permits an award of fees if the subject litigation was the “catalyst” for the government’s change of position even where the litigation did not result in a successful judgment or court order.  In order to win fees under the catalyst theory, however, the California Supreme Court has said that you must attempt to settle the dispute before filing the law suit.  (Graham v. DaimlerChrysler Corp., 34 Cal. 4th 533, 560 (2004)). 

The question addressed by the Court of Appeal in Hogar v. Community Development Commission is whether you are entitled to fees for those pre-litigation activities.  The court ruled that fees for pre-complaint activities were not precluded under section 1021.5, but that a litigant seeking such fees will “bear a heavier burden of demonstrating how that activity contributed to the success of the litigation.”

The lesson for counsel involved in these actions is to keep accurate records of their time from the first contact with the government agency — even if you are unsure at that point that your client will pursue litigation if those initial contacts are unsuccessful.

Damages do not limit attorney fees

Thursday, October 4th, 2007

A standard argument made by defendants on the losing end of an attorney fee award is that the fees are disproportionate to the damages.  The Fifth District resoundingly rejected that complaint in Nichols v. City of Taft.

In addition to noting that the litigation was hard fought (in part due to the zealous representation of the defendant), the court rejected the idea that attorney fees were limited to the amount of the damages award.  As the court notes, “it is not uncommon for attorney fee awards to exceed compensatory damages” in employment discrimination cases.  The court also rejected the argument because the defendant had not backed up the claim with any “applicable California precedent.”

Big city rates not recoverable

Thursday, October 4th, 2007

When you apply for an award of attorney fees under Code of Civil Procedure §1021.5, your standard fee is not the relevant measure.  That is the lesson of this week’s ruling by the Fifth District Court of Appeal in Nichols v. City of Taft

The standard for calculating the “lodestar” under section 1021.5 is not the rate the attorney charges.  Instead, “[t]he lodestar figure is calculated using the reasonable rates for comparable legal services in the local community for noncontingent litigation of the same type…” (emphsis in original).

Out of town attorneys can get their higher standard fee only by establishing that local counsel is not available for the case.  Thus, in this action, the San Francisco attorneys will have to settle for Kern County rates — unless they can convince the trial court to add a multiplier on remand.

Failure To Win Costs on Appeal Does Not Preclude Award of Attorney Fees

Wednesday, August 29th, 2007

By statute, attorney fees are an element of cost (even when awarded pursuant to contract).  So, what happens when the remittitur from the appellate court directs that the parties bear their own costs for the appeal? 

In Butler-Rupp v. Lourdeaux,the court ruled that the costs award does not speak to an award of attorney fees — especially where the court had not been asked to award those fees.  Thus, the award based on contract reverts to the normal rule that the party who achieves the greatest net relief is the prevailing party and is entitled to an award of fees.

1021.5 Fees — You Need to Ask for Findings!

Friday, August 24th, 2007

In the continuing saga of Vasquez v. California, concerning the state’s compliance with prison wages as required by Proposition 139, Vasquez has again been successful in winning fees for post-judgment enforcement activities.  In this appeal, the court rejects the state’s argument that the trial court ruling is not supported by appropriate findings:

 ”The State also complains that the court did not make the proper findings on the record under section 1021.5 before awarding Vasquez attorney fees. Where, however, the court was not asked to make findings on factual issues and did not do so, we must infer all findings necessary to support the order on fees and uphold it if it is based on substantial evidence.”

Another portion of the Vasquez case currently before the California Supreme Court will be of great interest to attorneys who rely on fees under Section 1021.5.  In that case, the court will be deciding how far to extend its ruling in Graham v. Daimler-Chrysler, requiring a pre-litigation settlement offer in order to recoup attorney fees in certain instances.

Twice the Lawyer at Less than Half the Cost

Wednesday, August 22nd, 2007

I’m thinking about this tag line in light of what I read in the Blog of the Legal Times this morning.  BLT points to a Wall Street Journal Story noting that hourly rates for some attorneys in New York have now broken through the $1,000 barrier.

Make note of these attorneys — their declarations attached to your next application for attorney fees could be worth their weight in gold!

City Must Indemnify Board Members it Sued!

Tuesday, August 21st, 2007

The San Diego City Attorney’s decision to sue members of the city’s retirement board seriously backfired.  Not only did the city attorney fail to establish the claim (the actions were ultimately dismissed at the city’s request), the court has now ruled that the city must pay the board members’ attorney fees incurred in defending the actions.

The ruling is based on an earlier ordinance requiring the city to “defend, indemnify, and hold harmless … [board] members … against all expenses, judgments, … and other amounts” in suits against the board members for actions taken in the scope of their duties as members of the board.

The court ruled that it did not matter that the litigation here was filed by the city attorney against the board members for dereliciton of duty.  Since the city never made a finding of wrongdoing by the board members, the court ruled that the indemnification ordinance applied.

The Kids Take Precedence Over Your Choice of Defense Counsel

Monday, August 20th, 2007

Do child support determinations in California attempt to replicate the decision making of “intact” families, or do they represent some other fundamental state policy on parental obligations to children?  This is the question that occurred to me as I read the decision in Brothers v. Kern.

Brothers is on trial for capital murder.  To pay for his defense counsel, he sold his house and deposited the funds with his attorney.  Brothers was also obligated to pay child support, however, and he was behind in his obligations.  The court rejected counsel’s arguments that Brothers was now indigent, and ordered the child support obligation to be paid out of the client trust fund.

The court also rejected the argument that this order would conflict with Brothers’ constitutional right to the counsel of his choosing.  According to the court:  “The Constitution does not insulate a criminal defendant from third-party claims just because the satisfaction of those claims reduces the defendant’s ability to afford retained counsel.”