Overall, Shows a Slowdown In Things, Consonant with the Economy.
The California Judicial Council has issued its “Statewide Caseload Trends: 2001-2001 through 2009-2010,” a comprehensive report that tracks 2009-2010 fiscal year (FY) statistics as well as 10-year trends.
Here is what we found interesting from the 2009-2010 statistics:
*The California Supreme Court issued 96 written opinions during this FY;
*The overwhelming portion of petitions for review or original writ requests directed to the supreme court emanated from the criminal area;
*The supreme court only depublished 4 Court of Appeal decisions during the FY (way down from past years, such as 1990 where over 100 opinions were depublished);
*Statewide, 9% of the Court of Appeal decisions were certified for publication/partial publication (our local Santa Ana appellate court clocked in right around there, while the Fifth District was lower by about half);
*Civil processing for civil unlimited cases was 72% within 12 months, 87% within 18 months, and 93% within 24 months;
*The Third District Court of Appeal had the highest number of filings/dispositions per justice (27% higher than the statewide average for other intermediate appellate courts), whereas the First District had the lowest number of per-justice filings/dispositions;
*The statewide average of pending appeals per justice was 129 as of June 30, 2009, but decreased 9% to 118 as of June 30, 2010;
*After being heavily backlogged for a number of years, our local Fourth District, Division 3 is among the top intermediate appellate courts when it comes to time for processing appeals of civil cases; and
*As far as unlimited civil case dispositions, a huge percentage was disposed of through settlement/pretrial motions, and only about .63% went to a jury trial and only about 11.56% proceeded to a bench trial (although these percentages are not quite precise based on the statistical disposition “lag,” but do give some idea of the overall amount of civil litigation that does not get resolved through actual trials).
Here is a link to the report for you statisticians or readers desiring more detailed information. (There are is an Appendix with a lot of drill-down information.)
As reported by Jaimee Lynn Fletcher in a February 12, 2012 article in The Orange County Register, Huntington Beach works on about 45 lawsuits in a given year. The personnel cost tally for this litigation: $952,311, according to the article.
Henry Huntington (1850-1927). “In my day, $1,000,000 meant something.”
USCCA Has Gun Self-Defense Insurance.
Since the right to bear arms has seemingly gotten more constitutional/political oomph lately, we saw an interesting report that United Stated Concealed Carry Association (USCCA), an organization devoted to armed citizens who have decided to conceal and carry guns, has created a unique concealed carry insurance-backed membership benefit. A Self-Defense SHIELD insurance-backed, membership benefit will cover up to $300,000 in legal defense expenses should a concealed carrying member face criminal or civil charges for using a weapon in self-defense.
Costa Mesa Sought Federal Enforcement Help Due in Part to Mounting Legal Expenses in Marijuana Dispensary Lawsuits.
Joseph Serna, in a February 8, 2012 post in the Daily Pilot, informs us that the City of Costa Mesa asked for federal authority enforcement help in attempts to shutter illegal marijuana dispensaries due in part to the City’s high legal costs in challenging the clinics. Mr. Serna reports that the City has spent $457,612 on such court costs.
San Diego Man’s Attorney Loses Request to Recoup $1.3 Million in Attorney’s Fees For Representing Client in Kimball Dam Water Dispute.
A February 8, 2012 post from the Napa Valley Register informs us that Napa County Superior Court Judge Raymond A. Guadagni, on February 8, denied attorney William McKinnon’s request that Calistoga pay $1.3 million in attorney’s fees for his representation of San Diego’s Grant Reynolds, who had sued to force the City to release more water from behind the Kimball Dam to boost fish habitats downstream in the Napa River. The judge found that the fees were not recoverable under California’s private attorney general statute, with Calistoga mainly arguing that the ultimate decision to release more water downstream was the result of pressure from state regulator’s rather than Reynolds’ lawsuit. For its own part, Calistoga has spent at least $900,000 on its own lawyers in fighting this and other water rights lawsuits brought by Mr. Reynolds.
PowerPoint Argument Presentations No Go; Videotaped Depositions A Go Under the Right Facts; And “Bright Line” Rule Offered On Cost Reimbursement Where Plaintiff Makes Successive 998 Offers.
As you can probably tell from our topical headlines above, the Second District, Division 1 issued an important routine costs/CCP § 998 cost-shifting opinion in Martinez v. Brownco Construction Co., Inc., Case No. B226665 (2d Dist., Div. 1 Feb. 10, 2012) (certified for publication), authored by Justice Chaney on behalf of a 3-0 panel.
If you haven’t guessed it yet, plaintiffs won respective $1.645 million and $250,000 jury awards against defendant in a negligence personal injury action after defendant rejected two prior significant 998 offers, each of which beat the eventual jury verdicts.
That inspired the trial court to do this: (1) award about $12,000 for editing video deposition testimony/presenting jurors with videotaped deposition recording; (2) award plaintiffs over $87,280 for a PowerPoint presentation used during closing argument; (3) award plaintiffs over $64,500 in expert witness fees based on expert expenses after defense rejection of the second offer; but (4) deny plaintiffs expert witness fees of $188,500 incurred after their first section 998 offers but before their second 998 offers.
Well, those lower court rulings did result in a published opinion setting some things straight. (Interestingly, the costs proceedings were heard before a bench officer not presiding at the trial--a not infrequent occurrence when original bench officers die or moves on--with the appellate court indicating that the moving party for costs needs to give more complete evidence when this situation occurs, but with the more detached bench officer’s rulings only going to the burden of persuasion rather than the ultimate standard of review. This is a nuanced determination which should be noted in subsequent cases.) Here is what happened on appeal:
#1: Videotaped deposition expenses were sustained, especially given the lower court record indicating that they were incurred for a crucial witness (“necessary,” not just helpful in nature);
#2: PowerPoint presentation for closing argument, not a summary of proof, was only “helpful” but not necessary, so that it was an abuse of discretion to award it as costs (contrasted with mandatory cost reimbursements for exhibits and summaries presented as evidence before the trier of fact); and
#3: The expert witness fees incurred between the first and second 998 offers were incorrectly denied to plaintiff. This was the heavily discussed item, given two appellate court decisions that could be construed as going the other way. However, the Second District, Divison 1 determined, both on contractual, policy, and preference for “bright line” rule grounds, that “[w]hen a party makes two section 998 offers to compromise more than 30 days apart, the purpose of section 998 is adequately served by the statute’s existing language, which entitles an offeror to cost shifting from the date of the earliest reasonable offer. This rule encourages early settlement, respects the Legislature’s preference for early discovery and evaluation of the merits of lawsuits, and presents a certain, bright line rule by which settlement negotiations may be guided. If any mischief or confusion results from later offers, or any gamesmanship arises, the court can address such concerns when it awards costs.” (Slip Opn., pp. 16-17.)
So, the videotape costs were sustained, the PowerPoint argument costs were reversed, and the expert witness fees denial between the two 998 offers was remanded for a further redetermination.
BLOG UNDERVIEW--This Division has announced prior “bright line” rules, determining that 998 offers which exclude “costs” means that attorney’s fees are within the ambit of the “costs” exclusion of the 998 offer. (See Martinez v. L.A. County Metropolitan Transp. Auth., 195 Cal.App.4th 1038 (2011) (Rothschild, J.) [one of our Top 20 Opinions for 2011].)
BLOG BONUS: The Anti PowerPoint Party is a Swiss political party dedicated to decrease professional use of PowerPoint. Really.
10% Reduction for Improper Redaction Was Not Enough to Compensate for Deficient Fee Substantiation.
This is an interesting decision on the substantiation of fees area, which again has us reminding practitioners to be careful to not over “redact” fee billings placed before the trial court. (For some helpful past insight, see our prior posts of June 30, 2008 on Gregg I and Gregg II.)
City of Lake Forest v. Lake Forest BodyCentre, Case No. G043301 (4th Dist., Div. 3 Feb. 9, 2012) (unpublished) is a situation where City of Lake Forest was awarded substantial attorney’s fees of $456,962.11 for winning a nuisance abatement action under the Red Light Abatement Law--with Civil Code section 3496 allowing a lower court discretion to award fees and costs, as it did here, in such cases. However, the problem was that the public entity fee claimant submitted billing statements that were “redacted beyond comprehension,” and provided no other real detail in the supporting attorney declarations.
The result can hardly be surprising, a reversal and remand. The lower court did try to save resources by simply reducing the lodestar by 10% for the over-redactions, but the appellate court felt that a remand was proper given that the other proof--the attorney declarations--provided no further enlightenment.
As far as City’s costs memorandum, it almost lost its costs request because it failed to provide the worksheet back-up to the one-page summary Judicial Council forms, which we have cautioned our blog followers to not do. Provide some detail. Here, in opposition to the motion to strike/tax costs, the detail was provided so that the costs award was affirmed. (In fact, our January 15, 2012 post on Anderson v. Pacific Asian Enterprises presented a situation where Justice Fybel--see below--did uphold denial of deposition costs where only the Judicial Council one-page summary was used.)
BLOG UNDERVIEW--Justice Fybel was the author of this 3-0 opinion. He indicated at a past L.A. County Bar section meeting that practitioners need to provide a “roadmap” to trial and appellate courts when presenting fee petitions, something that is not done when overly redacted billings are used. We would point out two other interesting unpublished decisions we posted on previously, which suggest some options in this area: either waive the privilege and don’t redact (or redact judiciously) or provide very detailed attorney declarations on tasks/hours/work effort so that an intelligent decision can be made on fee requests. (See our March 31, 2011 post on Johnson [unpublished Fifth District decision] and our December 20, 2011 post on Fullerton v. Monogram Real Estate [unpublished Fourth District, Division 3 decision authored by Justice O’Leary].)
$628,083.75 Fee Request (Lodestar With 1.5 Multiplier) Was Rejected by Trial Court.
Espinoza v. County of Orange, Case No. G043067/G043345 (4th Dist., Div. 3 Feb. 9, 2012) (unpublished) is a situation where a civil rights plaintiff did win $820,000 in damages against Orange County, but was less than happy when the lower court only awarded fees of $194,581 rather than the $628,083.75 (lodestar plus 1.5 proposed multiplier) requested by plaintiff.
Plaintiff’s appeal did not gain him any more fees.
Acting Presiding Justice Rylaarsdam, writing for a 3-0 panel, found no abuse of discretion in the amount of the fee award and found no indication that the lower court misapplied lodestar standards in fashioning the award. The defense suggested a $167,741.25 award, based on a lodestar de-enhanced by a .5 multiplier reduction. The lower court found plaintiff’s request--75% of damages--to be “astonishing” in nature, because it believed the case was not that complex or intellectually demanding. Beyond that, plaintiff did not prevail on all claims, so that limited success was another basis justiying the reduced award.
The lower court also properly denied $45,000 in expert witness fees when it found that the expert was not very illuminating during trial.
We Figure That $150,000 Fee Award Was Affirmed On Appeal.
In Williams v. Butte County, Case No. C066234 (3d Dist. Feb. 8, 2012) (unpublished), plaintiff--a qualified medical marijuana patient--formed a collective of medical marijuana patients but had to destroy a lot of plants when a sheriff ordered them to do so without a warrant. Patient earlier won a significant, published writ proceeding about plaintiff’s right to grow medical marijuana cooperatively. Subsequently, the trial court awarded, if our calculations are correct, about $150,000 in fees, calculated as a lodestar of $500/hour times 147.6 hours, augmented by a two-fold multiplier, under California’s private attorney general statute (CCP § 1021.5).
County appealed, to no avail. The bottom line was that the writ proceeding was a significant ruling in the medical marijuana area, so County’s “pooh-poohing” did not go very far with the appellate court also having decided the writ decision. County actually argued it should have been awarded attorney’s fees because plaintiff’s suit was groundless under Code of Civil Procedure section 1021.7, a specialized governmental sanctions statute which is the inverse of section 1021.5, but this was rejected because of a key “disconnect”--plaintiff did win the marijuana dispute, County failing to link testimony from an uncorroborated federal felon with other claimed acts. Fee award affirmed.
Only the Oracles May Know, But We Do Have a Reported Estimate!
As reported in a February 2, 2012 post at Huffpost Celebrity, Lindsay Lohan--and who better to post on--has gotten a lot of publicity on numerous matters in the past few years. However, some of the matters have required both civil and criminal lawyers to handle them. No one knows the price tag, but attorney Vikki Ziegler has estimated her attorneys’ costs to be at least hundreds of thousands of dollars and likely over a million. Attorney Joey Jackson was quoted as saying a $250,000 base was involved. Zowie, Batman!
Fee Denial By Trial Court Was Correct.
In a long unpublished decision that is good reading for practitioners involved in a prescriptive easement dispute, a trial court ultimately concluded that the plaintiffs owned a fee simple interest in a 40-foot strip of land running along the eastern boundary of their property and that adjacent defendant landowners had a prescriptive interest in the strip as a path for foot traffic (not a prescriptive easement as a road for vehicular traffic).
However, the trial court denied awarding any requested attorney’s fees to plaintiffs although they did prevail to some extent (and maybe more than defendants).
The fee denial decision was affirmed in Scheel v. Henderson, Case No. C062704 (3d Dist. Feb. 7, 2012) (unpublished).
Plaintiffs staked their fee request upon the “tort of another doctrine,” which we have a separate category for that can be searched on our home page. Even though expense of clearing title is a proper element of damages in a slander of title action so as to invoke the doctrine (Glass v. Gulf Oil Corp., 12 Cal.App.3d 412, 438 (1970)), plaintiffs’ problem was they did not plead it and did not prove a slander of title claim because there was no publication and the one communication was privileged in nature.
BLAWG BONUS: The co-contributors to this blawg, William M. ("Mike") Hensley and Marc Alexander, have published an article about attorney's fees as damages in California Litigation, the Journal of the Litigation Section, State Bar of California, Volume 21, Number 3, 2008, an all-theme issue devoted to the subject of "Damages." For a link to our article, see our November 13, 2008 post.
Case Demonstrates Trial Court Decisions Will Be Sustained on Any Right Ground Existing in the Record.
In Nesbitt v. Emmanuel, Case No. B224521 (2d Dist., Div. 4 Feb. 7, 2012) (unpublished), the trial court awarded both compensatory and punitive damages under the financial elder abuse statutes to a trust. It also awarded attorney’s fees to the trust under Welfare and Institutions Code section 15667.5(a). Even though this provision may well only apply to an elder or dependent adult (and not to a trust entity), the fee recovery was upheld because there was an alternate basis: a fees clause in the note running in favor of the trust. So, fee judgment affirmed in case of the duped elderly trustee.
$18,957 Award of Expert Witness Fees Against Plaintiff Was the Outcome.
The facts in some cases are simply amazing. Cano v. Anaheim Arena Management, LLC, Case No. G044751 (4th Dist., Div. 3 Feb. 6, 2012) (unpublished) is one of them.
Plaintiff doctor was attending a concert by “The Boss” (Bruce Springsteen) at the Honda Center in Anaheim when another concertgoer, who apparently was intoxicated, fell backwards and landed on plaintiff’s head resulting in permanent blindness in her left eye requiring her to close her medical practice. The falling concertgoer died from a heart condition six months after the concert. Plaintiff sued defendant management company mainly for negligence, although defendant won a summary judgment because it adequately screened each concertgoer and even the other concertgoer’s wife said he did not appear drunk at the time of the concert. The trial court later awarded defendant $18,957 in expert witness fees because plaintiff failed to beat a 998 offer worth $125,000 ($101,000, plus waiver of the costs inclusive of routine costs and expert witness fees).
Plaintiff did not convince the appellate court that the section 998 offer was token or made in bad faith, in a 3-0 decision authored by Justice Aronson.
Just because plaintiff claimed serious injuries did not justify finding the offer to be illusory in nature. After all, there were serious liability questions and the offer was made nearly five months after defendant served its summary judgment motion such that plenty of information was available to plaintiff for assessment purposes. Also, plaintiff may have suffered from a preexisting eye condition that would have diluted the damages picture. In the end, even hindsight could not support disturbing the trial court’s discretionary decision that the 998 decision was reasonable based on the circumstances existent at the time of the offer. Expert fee-shifting was appropriate in this interesting case. (Essex Ins. Co. v. Heck, 186 Cal.App.4th 1513, 1528-1530 (2010).)
Except For $83,229.49 Component Sent For Remand Determinations, $836,899.99 Was the Fee Hit Against Losing Plaintiff.
Plaintiff suing for trade dress protection under the Lanham Act lost a functionality-oriented case in Secalt S.A. v. Wuxi Shenxi Construction Machinery Co., Ltd., Case Nos. 10-17007 et al. (9th Cir. Feb. 7, 2012) (for publication). The district court also determined that this was an “exceptional” case giving rise to fee shifting under Lanham Act section 35(a). 15 U.S.C. § 1117(a). It awarded attorney’s fees and non-taxable costs of $836,899.99 to the winning defendant.
Except for an $83,229.49 component remanded for a redetermination, the remainder of the fee/costs award was sustained. Even though the line for Lanham Act “exceptional” fee recovery is somewhat murky for the prevailing defendant, here the failure of proof was clear given the two years of discovery and further investigation by losing plaintiff, who lost pretty convincingly on a functionality issue. (Plaintiff’s own witnesses and third-party witnesses seemed to confirm the functionality of the claimed trade dress, with merely the “hope” of a third-party patent not saving the day for plaintiff.) Although the Lanham Act did allow the prevailing defendant to recover non-taxable costs, the remand component was questionable and had to be vacated so that the district court could determine if the sub-components were reasonably incurred. Also, a small amount of taxable routine costs had to be vacated because an attorney providing translation services was not the equivalent of an “interpreter” for purposes of a cost award.
Except For $83,229.49 Component Sent For Remand Determinations, $836,899.99 Was the Fee Hit Against Losing Plaintiff.
Plaintiff suing for trade dress protection under the Lanham Act lost a functionality-oriented case in Secalt S.A. v. Wuxi Shenxi Construction Machinery Co., Ltd., Case Nos. 10-17007 et al. (9th Cir. Feb. 7, 2012) (for publication). The district court also determined that this was an “exceptional” case giving rise to fee shifting under Lanham Act section 35(a). 15 U.S.C. § 1117(a). It awarded attorney’s fees and non-taxable costs of $836,899.99 to the winning defendant.
Except for an $83,229.49 component remanded for a redetermination, the remainder of the fee/costs award was sustained. Even though the line for Lanham Act “exceptional” fee recovery is somewhat murky for the prevailing defendant, here the failure of proof was clear given the two years of discovery and further investigation by losing plaintiff, who lost pretty convincingly on a functionality issue. (Plaintiff’s own witnesses and third-party witnesses seemed to confirm the functionality of the claimed trade dress, with merely the “hope” of a third-party patent not saving the day for plaintiff.) Although the Lanham Act did allow the prevailing defendant to recover non-taxable costs, the remand component was questionable and had to be vacated so that the district court could determine if the sub-components were reasonably incurred. Also, a small amount of taxable routine costs had to be vacated because an attorney providing translation services was not the equivalent of an “interpreter” for purposes of a cost award.
Denial of 998 Cost Enhancements Was Not Improper.
Maaso v Signer, Case No. B228314 (2d Dist., Div. 2 Feb. 7, 2012) (certified for publication) is one of those lessons for all of us practitioners who arbitrate to take to heart--make sure you check the arbitration submission agreement for breadth of issues, meaning that fees and costs must be sought from arbitrators, and not confirming trial courts after a win.
Succinctly put, plaintiff lost a first arbitration but won a second arbitration after the initial one was vacated based upon an ex parte contact between a party arbitrator and neutral arbitrator. Plaintiff won a significant monetary award in the second arbitration, exceeding a CCP § 998 offer made by plaintiff and rejected by defendant prior to the first arbitration. However, plaintiff sought 998 costs as the prevailing party at the trial court level after granting of the petition to confirm the arbitration award. The trial court denied all arbitration costs on the basis that they were within the sole purview of the arbitrators.
Plaintiff’s appeal of the cost denial was unsuccessful. The arbitration submission was broad such that the 998 cost enhancements should have been sought from the arbitrators. See Corona v. Amherst Partners, 107 Cal.App.4th 701, 706 (2003). (The appellate court did reject the defense argument that the 998 offer made during the first arbitration somehow had to be renewed to be effective.) The alternative language in section 998 that the costs enhancement could be made by “the court or arbitrator” did not mean that the court could override arbitral authority where the submission agreement was broad in nature; otherwise, arbitrator finality would be eroded if that ADR route is truly chosen.
Lemons into Lemonade: Defense 998 Offer Was Well-Taken and Plaintiffs Did Not Achieve Their Real Litigation Objectives in Rejecting Offer and Going to Trial.
CCP § 998 offers are tricky things, but legislatively crafted so that the offeree give serious consideration to the offer so that a settlement can be reached--saving everyone (the litigants and courts) a lot of resources. Plaintiffs in the next case did win “lemon law” relief for an apparently defective Bentley, but did not win their real litigation objectives as we shall see soon. That meant the defense, even though having to pony up money, was able to garner certain costs of the litigation under § 998.
Williams v. Bentley Motors, Inc., Case No. B217997 (2d Dist., Div. 8 Feb. 3, 2012) (unpublished) is a case where plaintiffs did obtain significant “lemon law” relief by equitable rulings from a trial court after a jury verdict and grant of a new trial motion. However, the problem was that the defendant had served a tightly-crafted § 998 offer that gave them all the reimbursements awarded by the court (which it seemingly had paid anyway along the way to plaintiffs). What plaintiffs really wanted was reimbursement of full-time chauffeur costs to drive them around when the Bentley was out of commission and recovery of lost profits from using the limo for personal rather than business purposes. Plaintiffs did not win any of this relief, such that the § 998 offer prevailed--with both the trial and appellate courts focusing on whether the pragmatic litigation objectives of plaintiffs were met (and they were not). Defendant was entitled to recover certain costs allowable under § 998, although not specified in the decision.
Also, even though the defendant misidentified one particular offeree once in the § 998 offer, the offeree was identified correctly many other times; this one typo did not invalidate the offer.
Toomer’s Drug Store. Auburn, Alabama. 2010. Carol M. Highsmith collection, Library of Congress.
No Place Like Home: FHA/FEHA Restrictions Held Not Applicable to Roommate Selection for Sharing Inside of Living Units.
Roomate.com, LLC, which maintains a website asking questions about sex, sexual orientation, and familial status for individuals seeking roommates, must have been shocked when a district judge granted a summary judgment/permanent injunction based on finding that this selection process violated the Fair Housing Act (FHA). Even worse, San Fernando’s Fair Housing Council was awarded $494,714.40 in attorney’s fees.
Roommate appealed. Good move.
In a 2-1 opinion, Chief Judge Kozinski authored a Ninth Circuit opinion vacating both the merits and fee orders in Fair Housing Council of San Fernando Valley v. Roommate.com, LLC, Case Nos. 09-55272 et al. (9th Cir. Feb. 2, 2012) (for publication). The majority found that FHA and FEHA did not apply to the roommate selection process for the sharing of living units. With that determination, the substantial fee award went POOF! also.
BLOG UNDERVIEW--Here is the colorful beginning of this opinion: “There’s no place like home. In the privacy of your own home, you can take off your coat, kick off your shoes, let your guard down and be completely yourself. While we usually share our homes only with friends and family, sometimes we need to take in a stranger to help pay the rent. When that happens, can the government limit whom we choose?”
$1 Million of Proposed Appropriation Are Court-Ordered Fees to Winner in Violent Video Game Litigation.
As reported in a January 31, 2012 post in The Sacramento Bee, the California State Assembly has approved Senate Bill 730, which in turn proposes payment of $13 million in settlements and court-ordered attorney’s fees in legal disputes by the State of California.
Included in this amount was $1 million in court-ordered fees in Entertainment Merchant Association’s successful challenge of a California law banning sale of violent video games to minors--a dispute going all the way to the U.S. Supreme Court, who sided with the Association.
Now, the bill will proceed to the State Assembly and, if passed, then goes to Governor Jerry Brown for signature, with Governor Brown ironically defending the California ban when he was Attorney General (although that it what AG’s typically do).
Employee Won Substantive Unconscionability Argument Based on Absence of Frivolousness Requirement for Employer FEHA Fee Recovery.
Normally under FEHA, a prevailing defendant (usually, an employer) can only recoup fees if it proves that plaintiff employee’s claims were frivolous, unreasonable, without foundation, or brought in bad faith. What happens when an employer inserts an arbitration clause into a contract with an employee allowing the arbitrator to award the prevailing party fees as to FEHA claims sans the elevated requirements for a winning defendant? Short answer: it is a factor which can lead to judicial nonenforcement of the arbitration clause.
Mayers v. Volt Management Corp., Case No. G045036 (4th Dist., Div. 3 Feb. 2, 2012) (unpublished) is an illustration of this, where a 3-0 panel (author: Justice Fybel) affirmed a lower court’s denial of a motion to compel arbitration under a fees clause with just such a provision. Such a clause did manifest a degree of substantive unconscionability when, combined with other factors, led to it not being honored. As far as the prevailing party fees clause, the appellate court found that it was too pro-employer and weakened the frivolous-based protections normally available under FEHA to losing employees. (Trivedi v. Curexo Technology Corp., 189 Cal.App.4th 387, 394-395 (2010).)
So, employers, consult Trivedi and Mayers on this issue, not to mention the California Supreme Court’s seminal decision of Armendariz v. Foundation Health Psychcare Services, Inc., 24 Cal.4th 83 (2000) when drafting arbitration clauses.
Though Their Defense to Tort Claims Did Not Give Rise to a Fee Entitlement, Cross-Claim Win Did It For Prevailing Lessees.
Arrambide v. Mastagni, Case No. B223980 (2d Dist., Div. 6 Feb. 2, 2012) (unpublished) reinforces a good lesson in the Civil Code section 1717 area--you can win fees on a cross-claim even though your defense to tort claims will not do the job.
There, lessees successfully defensed a lessors’ complaint based on fraud, which would not give rise to section 1717 fees even though lessees successfully raised a contractual defense to a tort claim. (Gil v Mansano, 121 Cal.App.4th 739, 741 (2004).) However, not to despair. Lessees did win on cross-claims which sought to enforce the lease. The win fortified that they were entitled to $40,000 in fees, as the lower court appropriately awarded.
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![14. Photocopy of photograph [original print located at University Archives, Hayden Library, Arizona State University, Tempe, Arizona]. Photographer unknown, 1902 VIEW SHOWING TRAIN WRECK ON MARICOPA AND PHOENIX RAILROAD CAUSED BY BRIDGE FAILURE RESULTING FROM FLOOD DAMAGE - Ash Avenue Bridge, Spanning Salt River at Foot of Ash Avenue, Tempe, Maricopa County, AZ](http://lcweb2.loc.gov/pnp/habshaer/az/az0200/az0253/photos/009565pr.jpg)
