Judge: Anne Richardson, Case: BS139829, Date: 2023-11-07 Tentative Ruling

Case Number: BS139829    Hearing Date: November 7, 2023    Dept: 40

Superior Court of California

County of Los Angeles

Department 40

Background

Relevant Procedural History

On or about October 26, 2012, the Court issued a sister-state judgment from New York in favor of Plaintiff Gunnlaugur Petur Erlendsson as against Defendants David Glasser, Phillip Glasser, and Marvin Peart (collectively, “Defendants”) in the amount of $831,611.83.

On or about September 19, 2017, Plaintiff Erlendsson renewed the judgment against Defendants for $1,086,681.39.

On May 7, 2018, Defendants and Plaintiff Erlendsson entered a settlement and release agreement (Settlement Agreement) in favor of Plaintiff Erlendsson for $1,250,000 (Settlement Amount). Under the terms of the Settlement Agreement, Defendants were required to pay the Settlement Amount to Plaintiff Erlendson according to the following payment schedule: (1) $50,000 on May 7, 2018, and again every 7th of every month from June 7, 2018 to September 7, 2018; (2) $650,000 on October 7, 2018; and (3) $58,333 every 7th of every month from November 7, 2018 to April 7, 2019 (the Payment Schedule). The Settlement Agreement also provided at section II, paragraph 5 that if Defendants did not make timely payments to Plaintiff Erlendsson according to the agreement’s Payment Schedule, interest at the annual rate often percent (10%) per annum on the Settlement Amount would be calculated daily for every day during the period from May 7, 2018, through the date that the settlement was satisfied in full.

On the same date, the Parties also executed a Stipulation for Immediate Entry of Judgment (the Judgment Stipulation) that contains a provision for attorneys’ fees and costs relating to enforcement of the Settlement Agreement commencing from the date of Defendants’ failure to make timely payments under the Settlement Agreement.

On May 17, 2021, Plaintiff Erlendsson filed a motion for additional attorneys’ fees and costs in the amount of $116,991.35 for work incurred as of January 3, 2020 in relation to a default on the Payment Schedule by Defendants.

On October 28, 2021, the Court granted the motion in the amount of $27,261.69.

On February 16, 2022, the Court signed an order and judgment granting $27,261.69 in reasonable attorneys’ fees and no costs to be paid within 30 days of notice of entry of judgment.

On March 7, 2022, Plaintiff Erlendsson noticed entry of judgment.

On May 3, 2022, Plaintiff Erlendsson filed a motion to enforce the judgment requesting recovery pursuant to section II, paragraph 5 of the Settlement Agreement for Defendants’ default on the Payment Schedule. The clause involves an award that is triggered by a default on the Payment Schedule but is separate from monies owed based on the Payment Schedule.

On May 25, 2022, the Court granted the May 3rd motion to enforce the judgment in the amount of $543,547.47 per section II, paragraph 5 of the Settlement Agreement and awarded $22,562.00 in reasonable attorneys’ fees and no costs per the Judgment Stipulation.

On June 29, 2023, the Court signed an order and judgment granting the motion to enforce settlement in the amount of $543,547.47 and awarding reasonable fees and costs of $22,562.

On August 29, 2022, Plaintiff Erlendsson noticed entry of the June 29, 2022 judgment.

On August 4, 2023, Plaintiff Erlendsson filed a motion for attorneys’ fees and costs incurred in enforcing the February 16, 2022 and June 29, 2022 judgments (the 2022 Judgments), which remained unpaid as of that time.

On August 14, 2023, Defendants paid $478,225.74 to satisfy the 2022 Judgments.

On August 18, 2023, Plaintiff Erlendsson filed an acknowledgment of satisfaction in full for the February 16, 2022 judgment.

That same day, Plaintiff Erlendsson filed an acknowledgment of satisfaction in full for the June 29, 2022 judgment.

On October 25, 2023, Defendants opposed Plaintiff Erlendsson’s August 18th motion.

On October 31, 2023, Plaintiff Erlendsson replied to Defendants’ October 25th opposition.

Plaintiff Erlendsson’s August 18, 2023 motion for attorney’s fees and costs is now before the Court.

Evidentiary Objections

Opposition Objections

Objection Nos. 1-3: OVERRULED.

Motion for Attorneys’ Fees and Costs

Legal Standard

A prevailing party is entitled to recover costs as a matter of right. (Code Civ. Proc., § 1032, subds. (a)(4), (b).) Attorney’s fees are also recoverable as costs when authorized by contract, statute, or law. (Code Civ. Proc., § 1033.5, subd. (a)(10).) Attorney’s fees and costs may be awarded where a contract between the parties at issue specifically provides for such fees and costs and one party prevails over the other on the contract. (See Civ. Code, § 1717, subd. (a).)

The Court begins this inquiry “with the ‘lodestar,’ i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate.” (PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1095.) From there, the “lodestar figure may then be adjusted [according to a multiplier enhancement] based on consideration of factors specific to the case, in order to fix the fee at the fair market value for the legal services provided.” (Ibid.) Relevant multiplier factors include “(1) the novelty and difficulty of the questions involved, (2) the skill displayed in presenting them, (3) the extent to which the nature of the litigation precluded other employment by the attorneys, [and] (4) the contingent nature of the fee award.” (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1132.)

No specific findings reflecting the court’s calculations for attorney’s fees are required; the record need only show that the attorney’s fees were awarded according to the “lodestar” or “touchstone” approach. (Rebney v. Wells Fargo Bank (1991) 232 Cal.App.3d 1344, 1349, disagreed with on other grounds in In re Marriage of Demblewski (1994) 26 Cal.App.4th 232, 236, fn. 7 [disagreement as to statement of decision requirements].) The Court has broad discretion to determine the amount of a reasonable attorney’s fee award, which will not be overturned absent a “manifest abuse of discretion, a prejudicial error of law, or necessary findings not supported by substantial evidence.” (Bernardi v. County of Monterey (2008) 167 Cal.App.4th 1379, 1393-1394.)

Order Granting Fees and Costs: GRANTED, in Part.

Plaintiff Erlendsson seeks a recovery of $54,079.67 in attorneys’ fees and costs related to enforcement of the 2022 judgments, which is comprised of $46,806 in requested fees and $7,273.67 in requested costs. Plaintiff’s motion cites the Judgment Stipulation as the basis for fees and costs, provides an academic and professional background for Plaintiff’s counsel, justifies counsel’s fee rate of $580 per hour by comparison to articles or reports relating to reasonable billing rates for counsel of similar experience, and lists the work performed by counsel in incurring these fees and costs. (Mot., pp. 1, 3-6.)

Plaintiff’s counsel’s declaration provides a background on the Settlement Agreement and Judgment Stipulation, the 2022 Judgments, the fees and costs at issue, counsel’s academic and professional background, and references to an article and reports supporting counsel’s fee rate. (Mot., Wu Decl., ¶ 1-13, Exs. 1-2 [Settlement Agreement and Judgment Stipulation], 3-4 [the 2022 Judgments], 5 [verified billing records], 6-8 [article and reports supporting fees].)

In opposition, Defendants argue that fees should be reduced to $8,814. One reason for the suggested reduction is unreasonableness in hours, where there has not been substantial work in this litigation since May 2022 because the only outstanding issue remaining was the obligation to pay the 2022 Judgments. Defendants also seek a reduction of $5,162 in unreasonable fees related to witness examinations that never took place and to communications between counsel that were not billed or for which evidence is not provided. Defendants further challenge the vagueness of some of billing entries because of the heavy redactions to those entries. Defendants note that some entries are redacted even though they involve matters that should not be privileged, e.g., conversations between counsel. Last, Defendants challenge recovery for unbilled fees and costs sought in Plaintiff’s motion, as well as $7,273.67 in costs that are not recoverable or unreasonable. (Opp’n, pp. 4-8, 9.)

In reply, Plaintiff justifies the reasonability of the fee recovery sought, the redactions in the billing entries as preserving the attorney-client and work product privileges, and the ability to collect recovery for yet unbilled fees. Plaintiff also justifies the recoverability of any cost incurred by counsel, as well as the recoverability of yet unbilled costs. (Reply, pp. 1-8.)

The Court finds in favor of Plaintiff, in part.

The Settlement Agreement provides for this Court’s retention of jurisdiction to enforce the settlement if its provisions are not followed. (See Mot., Wu Decl., Ex. 1, Settlement Agreement, § II, ¶¶ 19 [“The Court is to retain jurisdiction under Code of Civil Procedure § 664.6 to enforce the terms of this Agreement”] 21 [attorneys’ fees clause]; Mot., Wu Decl., Ex. 2, Judgment Stipulation, ¶ 1(c) [attorneys’ fees clause]; Code Civ. Proc., § 1717.) The Court thus has authority to grant fees and costs here.

The Court approves the $580 per hour fee rate advanced by Plaintiff, which is reasonable for a Los Angeles-based partner like Mr. Wu, a more than 20-year practitioner. The Court also notes that the $300 per hour fee rate for work performed by Mr. Kevin Connelly—admitted to the Bar in November 2021 per State Bar of California records—is also reasonable, if on the high side, and is not addressed by either Plaintiff or Defendants. (Mot., Wu Decl., ¶ 8, Ex. 5, p. 86 [only billing entry related to Kevin Connelly at rate of $300 per hour for 0.2 hours for total of $60 in fees].)

However, the Court agrees that the number of hours for which Plaintiff seeks recovery is unreasonable and excessive. “A trial court is not required to state each charge it finds reasonable or unreasonable. A reduced award might be fully justified by a general observation that an attorney overlitigated a case.” (Karton v. Ari Design & Construction, Inc. (2021) 61 Cal.App.5th 734, 744.) Here, the Court determines that the attempts to enforce the 2022 Judgments were overlitigated. The Court simply does not accept that more than 60 hours were required of Mr. Wu to secure enforcement of those Court orders. While Mr. Wu’s billing records itemize the number of hours he spent attempting to enforce the 2022 Judgments on behalf of Plaintiff between May 2022 and June 2023, the Court finds that numerous entries either involved too much time on a particular task or are so redacted that the Court cannot determine whether that specific entry should be reduced or is reasonable. (See, e.g., Mot., Wu Decl., Ex. 5, p. 81 [36 minutes to review a Court order with part of the entry redacted, as well as entry that Mr. Wu “address[ed] [redacted] with client [redacted]” for 12 minutes]; see also id. at pp. 78, 88.) The Court does agree, however, that Plaintiff is entitled to fees expended by counsel even if they are yet unbilled because recovery is permitted for the hours actually worked by Mr. Wu. (Marino v. Denevi (1986) 182 Cal.App.3d 553, 558.) Timesheets for that work are not entirely necessary (Sommers v. Erb (1992) 2 Cal.App.4th 1644, 1651; Dunk v. Ford Motor Co. (1996) 48 Cal.App.4th 1794, 1810), though Plaintiff Erlendsson does have the burden of documenting the appropriate hours expended and hourly rates (City of Colton v. Singletary (2012) 206 Cal.App.4th 751, 784).

Therefore, based on the numerous billing entries that are either excessive or unclear based on redactions, the Court makes an across-the-board reduction to fees. (Morris v. Hyundai Motor America (2019) 41 Cal.App.5th 24, 40 [“‘[W]hen a voluminous fee application is made, the court may make across-the-board percentage cuts either in the number of hours claimed or in the final lodestar figure,” internal quotation marks and ellipses omitted, quoting Warren v. Kia Motors America, Inc. (2018) 30 Cal.App.5th 24, 41 (Warren)]; see Warren, supra, at p. 41 [“[T]he court must clearly explain its reasons for choosing the particular negative multiplier that it chose; otherwise, the reviewing court is unable to determine that the court had valid, specific reasons for its across-the-board percentage reduction”].)

For fees incurred from May 4, 2022 to August 4, 2023, as well as fees incurred filing this motion, replying to the opposition, and attending this hearing, the Court finds that a reasonable recovery in fees is $31,099.60, i.e., $46,806 sought by Plaintiff, minus $2,378 (fees for third-party debtor examinations that did not take place), yielding $44,428, which is further reduced by a 30% reduction across the board.

As to costs, the Court agrees that $1,609.72 should be reduced from the costs sought because those costs relate to research costs and courier and messenger services costs, which are not traditionally recoverable in a costs memorandum, and which are not expressly contemplated by the parties’ Settlement Agreement and Judgment Stipulation. However, the Court finds that the remaining costs are proper, for which reasons the Court finds that $5,663.95 is a reasonable award in relation to costs expended by Plaintiff’s counsel seeking to enforce the 2022 Judgments.

Plaintiff Erlendsson’s motion is thus GRANTED, in Part, in the amount of $36,763.55 ($31,099.60 in fees plus $5663.95). 

Conclusion

Plaintiff Gunnlaugur Petur Erlendsson’s Motion to Enforce Settlement and Motion for Attorneys’ Fees and Costs is GRANTED, in Part, in the amount of $36,763.55.