Code of Civil Procedure §1021.5 does not limit the amount of attorney fees a court may award in public interest cases, and specifically recognizes the power of a court to award a “multiplier” (an augmentation to the reasonable hourly rate multiplied by the reasonable hours expended in the matter). In a recent decision, however, the Court of Appeal has signaled that trial courts should be careful about fee awards that exceed the amount of recovery.
The court in Estrada v. Fedex Ground did not issue any new rules or particular guidelines. It did comment, however, that the trial court “[in recalculating an appropriate award on remand … must determine anew whether any multiplier is appropriate in this case” in light of both the limited success andthe fact that the fee award without the multiplier already exceeded the amount of the recovery.
The court acknowledge that it was only reviewing the trial court’s order for “abuse of discretion,” but cautioned that “the fee must above all else be reasonable.”
Further — and this is the point counsel must keep in mind in the fee applications and in drafting proposed orders awarding fees — “a multiplier, if used, must be based on facts other than those used to trigger the application of section 1021.5.” In a footnote, the court noted that in this case “the reasons justifying any award at all and an award based on high hourly rates … were the same as those used to justify the multiplier — the benefit to the class, the risk taken, the lawyers’ skill, the excellent results.”
[...] he has an excellent post entitled “Can Fees Exceed Damages?” He discusses yesterday’s decision in Estrada v. Fedex Ground Package System, Inc., case no. [...]