Judge: Bruce G. Iwasaki, Case: 19STCV02637, Date: 2023-11-30 Tentative Ruling



Case Number: 19STCV02637    Hearing Date: November 30, 2023    Dept: 58

Judge Bruce G. Iwasaki

Department 58


Hearing Date:              November 30, 2023

Case Name:                 Alpine Group v. Gooding & Company

Case No.:                    19STCV02637

Matter:                        Motion for Attorneys’ Fees and Costs

Moving Party:             (1.) Plaintiff Alpine Group

(2.) Defendant, Cross-Defendant & Cross-Complainant Gooding & Company, Inc.

Responding Party:      (1a.) Falcon Woods and (1b.) Gooding & Company, Inc.

(2.) Falcon Woods


Tentative Ruling:      (1.) Alpine Group’s Motion for Attorneys’ Fees is granted in the amount of $2,471,005.86.

                                    (2.) Gooding & Company, Inc.’s Motion for Attorney’s Fees is granted in the amount of $798,500.69.


 

This is an action regarding the sale of a 1964 Ferrari 275 GTB Shortnose Speciale (the Car or Ferrari). On August 30, 2023, following trial, the Court entered Judgment awarding Alpine Group (Alpine) specific performance of the Sale Agreement under which Alpine purchased a 1964 Ferrari 275 GTB Prototype (Ferrari) from Gooding & Company, Inc. for $5,175,000.

 

Plaintiffs Alpine now moves for an award of attorneys’ fees and costs in the amount of $2,943,834.75 against Gooding & Company, Inc. (Gooding) and Falcon Woods, LLC (Falcon Woods) jointly and severally. Both Gooding and Falcon Woods filed oppositions to the motion.

 

Gooding also moves for attorney fees in the amount of $844,986.00 plus any fees incurred in connection with opposition and reply, against Falcon Woods. Falcon Woods filed an opposition to this motion.

 

Alpine’s motion for attorneys’ fees is granted in the reduced amount of $2,471,005.86.

 

Gooding’s motion for attorneys’ fees is granted in the reduced amount of $798,500.69.

 

Evidentiary Issues:

 

Alpine’s objections to the declaration of Jardini are ruled as follows: Nos. 1-102 are overruled.

 

Legal Standard

 

As a general rule, the parties to a lawsuit must bear their own attorney’s fees. (Cassim v. Allstate Ins. Co. (2004) 33 Cal.4th 780, 806.)

 

Exceptions to the general rule are where attorney’s fees are specifically provided by statute or where the parties have expressly agreed to an award of attorney’s fees. Code of Civil Procedure section 1021 provides that “ ‘[e]xcept as attorney’s fees are specifically provided for by statute, the measure and mode of compensation of attorneys and counselors at law is left to the agreement, express or implied, of the parties....’ “ “Code of Civil Procedure section 1021 does not independently authorize the recovery of attorney's fees.” (Santisas v. Goodin (1998) 17 Cal.4th 599, 607, fn. 4.) Rather, it recognizes and codifies the general rule that attorney’s fees may be recovered only when they are authorized by a statute or provided for by the parties’ agreement. (Ibid.)

 

Civil Code section 1717 controls the recovery of attorney fees where the action is “on a contract” containing an attorney's fees provision. (Civ. Code, § 1717, subd. (a).) It provides:

 

“(a) In any action on a contract, where the contract specifically provides that attorney's fees and costs, which are incurred to enforce that contract, shall be awarded either to one of the parties or to the prevailing party, then the party who is determined to be the party prevailing on the contract, whether he or she is the party specified in the contract or not, shall be entitled to reasonable attorney's fees in addition to other costs.” (Ibid.)

 

Discussion

 

Procedural Issue:

 

In its motion for attorney fees, Gooding requests that the Court order that the attorney fees owed to Gooding and Alpine be paid out of the $5.175 million that Alpine was ordered to pay Gooding to hold in trust. Gooding notes that the combined fees of Gooding and Alpine are less than $5.175 million.

 

            Alpine does not object to Gooding’s proposal that the attorney’s fees awarded to Alpine and Gooding and Gooding’s commission be paid from the funds now held in trust by Gooding. Additionally, Alpine requests that the funds presently held in trust by Gooding should be used to pay the parties’ costs.[1]

 

            Falcon Woods also does not object to Gooding’s request that all attorney fee awards and the $175,000 commission should be paid out of the $5.175 million currently held by Gooding pursuant to the Court’s judgment, with the remainder remitted to Falcon Woods.

 

Alpine’s Motion for Attorney Fees:

 

Alpine moves for attorney fees in the total amount of $2,943,834.75 against Gooding and Falcon Woods, jointly and severally, pursuant to its Post-Auction Sale Agreement – Buyer (Sale Agreement). These attorney fees encompass the fees incurred by both Dentons US LLP (Dentons) – Alpine’s initial counsel in this case – and Glaser Weil Fink Howard Jordan and Shapiro, LLP (Glaser Weil) – Alpine’s successor counsel.

 

            In opposition, Falcon Woods argues Alpine’s fee request is so outrageous that the Court would be justified in denying it outright. (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1137 [“A fee request that appears unreasonably inflated is a special circumstance permitting the trial court to reduce the award or deny one altogether”] [italics added].) In the alternative, Falcon Woods argues that the fees must be significantly reduced to a fee amount not exceeding $125,840.06 (or $573,850.63 less than the amount sought by Gooding in its Motion for Attorney Fees).

 

            In its brief response to Alpine’s motion, Gooding also argues that Alpine’s fees are unreasonable.

 

Hourly Rates:

 

            In assessing the reasonableness of hourly billing rates,¿“the court may rely on its own knowledge and familiarity with the legal market, as well as the experience, skill, and reputation of the attorney requesting fees [citation], the difficulty or complexity of the litigation to which that skill was applied [citations], and affidavits from other attorneys regarding prevailing fees in the community and rate determinations in other cases.”¿(569 East County Boulevard LLC v. Backcountry Against the Dump, Inc.¿(2016) 6 Cal.App.5th 426, 437; see¿Mountjoy v. Bank of America, N.A.¿(2016) 245 Cal.App.4th 266, 272 [“ ‘ “a reasonable hourly rate is the product of a multiplicity of factors…[including] the level of skill necessary, time limitations, the amount to be obtained in the litigation, the attorney’s reputation, and the undesirability of the case” ’ ”].)¿

 

Alpine submits the declarations of Leah Bruno and Peter Bransten in support of the hourly rates for the Dentons and Glaser Weil attorneys and paralegals. Specifically, the hourly rates of the Dentons attorneys ranged from $550 to $920 for partners and $270 to $710 for associates. (Bruno Decl., ¶¶ 53-88.) In 2022, the hourly rates of the Glaser Weil attorneys who worked on the case were $1400 for Attorney Glaser – a partner – $800 for Attorney Peter Bransten – an Of Counsel – and $575 for Olivia Weiss – an associate; in 2023, these Glaser Weil rates increased to $1500, $900, and $675, respectively. (Bransten Decl., ¶ 27.) Alpine argues that these hourly rates are consistent with the hourly rates of attorneys at similar firms. (Bransten Decl., ¶¶ 33-39, Exs. D-I.)

 

In opposition, Falcon Woods argues that Glaser Weil’s hourly rates are excessive. Falcon Woods contends that the combined blended rate charged is an “astronomical” average rate of $808.83/hour, for attorneys and non-attorneys alike, which is especially inappropriate given the non-complex nature of the litigation. (Jardini Decl., ¶ 63.) As such, Falcon argues Glaser Weil’s rates should be reduced to match Dentons’ rates, which results in a $272,639 reduction from the gross billed amount. (Jardini Decl., ¶ 74.)

 

The Glaser Weil firm’s rates are high, particularly lead counsel’s. However, the Court cannot find they are unreasonable. (Bransten Decl., ¶ 28.) Based on the Court's familiarity with the current local market, and Alpine’s evidence of the experience and skills of its attorneys – Glaser Weil’s requested rates per hour are reasonable.

 

Hours Incurred:

 

            In arguing the attorney fee hours incurred were reasonable, Alpine recounts the entire procedural history of the case, which Alpine contends demonstrates the extensive litigation required in this case, justifying the hours sought. (Mot., 13:14-19:2.)

 

            Based on the evidence submitted by Alpine, the Dentons attorneys and staff performed a total of 2,956.1 hours of work in this matter for total billings of $1,807,838.50. (Bruno Decl., ¶ 92, Ex. A.) The Glaser Weil attorneys and staff performed a total of 1,404.50 hours of work in this matter for total billings of $1,135,996.25. (Bransten Decl., ¶ 32, Ex. C.)

 

            Falcon Woods argues that the amount of reasonable fees awarded to Gooding should serve as a starting point for Alpine’s fees.

 

1.     Apportionment for Non-Contract Claims:

 

            In its Second Amended Complaint, Alpine alleged causes of action for breach of contract, breach of the implied covenant of good faith and fair dealing, conversion, tortious breach of contract, civil conspiracy, and inducement of breach of contract. Alpine prevailed on the breach of contract claim only.

 

            “Section 1717 is the applicable statute when determining whether and how attorney's fees should be awarded under a contract.” (Sears v. Baccaglio, supra, 60 Cal.App.4th at p. 1157, 70 Cal.Rptr.2d 769.) Civil Code section 1717 “covers only contract actions, where the theory of the case is breach of contract, and where the contract sued upon itself specifically provides for an award of attorney fees incurred to enforce that contract.” (Xuereb v. Marcus & Millichap, Ins. (1992) 3 Cal.App.4th 1338, 1342, 5 Cal.Rptr.2d 154, disapproved on other grounds by Santisas v. Goodin, supra, 17 Cal.4th at p. 614, fn. 8, 71 Cal.Rptr.2d 830, 951 P.2d 399, as recognized by Damian v. Tamondong (1998) 65 Cal.App.4th 1115, 1127, fn. 13, 77 Cal.Rptr.2d 262.)

 

            Nonetheless, Alpine argues that “[w]here the issues associated with the cause of action on which a plaintiff prevails are common to other causes of action on which the plaintiff is not entitled to fees, apportionment of the fees would be improper. (Mot. 19:25-27 [citing Reynolds Metals Co. v. Alperson (1979) 25 Cal.3d 124, 129-30.) Further, “[a]pportionment is not required when the claims for relief are so intertwined that it would be impracticable, if not impossible, to separate the attorney’s time into compensable and noncompensable units.” (Bell v. Vista Unified School District (2000) 82 Cal.App.4th 672, 687.)

 

            Here, Alpine contends that all the causes of action shared the same factual issues: “whether Falcon Woods gave Gooding actual and/or ostensible authority to sell the Ferrari; whether Alpine purchased the Ferrari under the Sale Agreement; whether Gooding and Falcon Woods breached the Sale Agreement, and whether Gooding and Falcon Woods defendants had a defense to liability based on the Terms and Conditions of Sale incorporated into the Sale Agreement.” (Mot., 20:14-18.)

 

            In opposition, Falcon Woods argues that Alpine has misstated the law. When, as here, the fee-shifting provision allows the recovery of only fees incurred litigating contract issues, the court should apportion the fees “even where the issues are connected, related or intertwined.” (El Escorial Owners' Assn v. DLC Plastering, Inc. (2007) 154 Cal.App.4th 1337, 1365; see also Shadoan v. World Sav. & Loan Ass’n (1990) 219 Cal.App.3d 97, 109 [recognizing apportionment as the “best solution” even though the compensable and non-compensable issues were identical]; Heppler v. J.M. Peters Co. (1999) 73 Cal.App.4th 1265, 1297 [trial court abused its discretion in failing to apportion to account for time spent on non-compensable issues].)

 

            Moreover, Falcon Woods argues that the tort and contract claims can be apportioned. First, Alpine incurred fees opposing Gooding’s demurrer to its claims for conversion and civil conspiracy in its First Amended Complaint. Falcon Woods argues all the fees incurred in responding to Gooding’s demurrer are properly apportioned to the non-compensable tort claims, totaling $13,347.69. (Jardini Decl., ¶ 98.)

 

            Second, Alpine also incurred fees in opposing Falcon Woods’ demurrer to the FAC. Falcon Woods acknowledges that the demurrer included the contract claims, but argues that a majority of its argument section was devoted the non-contract issues; Falcon Woods calculated these non-recoverable fees to be $21,989.31.

 

            Third, Falcon Woods contends that the costs incurred in seeking leave to file a SAC and to oppose the demurrer that followed should be struck. Falcon Woods notes that Alpine’s SAC, filed in 2019, sought three substantive changes with respect to tort causes of action; thus, the demurer to these tort claims must also be non-recoverable. The total amount in this category is $71,321. (See Jardini Decl., ¶ 98.)

 

            Fourth, Falcon Woods moved for summary adjudication of Alpine’s second (breach of the covenant of good faith and fair dealing), third (conversion), and fourth (civil conspiracy) causes of action. Alpine’s opposition to the motion for summary adjudication addressed the contract claim (good faith and fair dealing) separately from the remaining (non-contract) claims. Falcon Woods estimates that forty percent of the work on that opposition is apportioned to the non-contract issues. (Jardini Decl. ¶ 95.) Thus, the fees should be reduced further by $29,992.20.

 

            After Alpine amended to add an inducement of breach claim as a fifth cause of action, Falcon Woods moved for summary adjudication of that claim as well as the request for punitive damages. Falcon Woods contends all fees incurred in opposing that motion – $56,953.50 – are non-recoverable. (See Jardini Decl. ¶¶ 96–97.)

 

            Finally, Glaser Weil incurred $14,553.43 for simply reviewing the non-compensable motions for summary adjudication related to the tort claims, which should also be excluded.

 

            In reply, Alpine contends that the Sale Agreement encompassed the tort claims alleged by Alpine. (Reply 4:5-6.) However, Alpine provides no analysis of this issue in the reply, and, as noted in the prior sentence, failed to raise the issue entirely in the moving papers, arguing only that apportionment was not proper here where the contract and tort claims involved a common core of facts.

 

            Falcon Woods is correct that a court may apportion fees even where the issues are connected, related or intertwined. (El Escorial Owners' Assn v. DLC Plastering, Inc. (2007) 154 Cal.App.4th 1337, 1365.) However, the Court need not apportion fees where claims are so intertwined that separation of time is “impracticable, if not impossible” to achieve. (Abdallah v. United Sav. Bank (1996) 43 Cal.App.4th 1101, 1111.)

 

            Here, however, the opposition persuasively demonstrates that it is not impractical to apportion at least some portion of the tort and contract claims. Thus, while most of the fees are related to issues that were “inextricably intertwined” and impractical to apportion, the challenges identified by Falcon Woods in its opposition to specific tort claims can be apportioned.

 

            Thus, Alpine’s attorney fees will be reduced by $208,157.13 ($13,347.69 + $21,989.31 + $71,321 + $29,992.20 + $56,953.50 + 14,553.43).

 

Falcon Woods also seeks an across the board percentage apportionment of a 25% reduction of Dentons’ time and a 20% reduction of Glaser Weil’s time to “reflect[] the appropriate apportionment of the remainder of their billed amounts to account for time spent on non-contract issues.” (Opp., 20:19-22 [Jardini Decl., ¶¶ 100-105.) This request is arbitrary and runs afoul of the “inextricably intertwined” nature of the litigation that renders such wholesale apportionment unfair and impractical.

 

(1.)  Frivolous procedural maneuvers:

 

            Falcon Woods also argues Alpine engaged in baseless litigation tactics and should not be able to recover the fees incurred in doing so. 

 

            Falcons specifically identifies the Alpine’s motion for summary adjudication that was heard two months after a similar motion was heard and denied because the Court found there was a triable issue of material fact in dispute. Approximately $167,261.00 fees were incurred in bringing this motion that was “destined” to fail following the Court’s prior ruling. Alpine also incurred another $81,378 preparing writ petitions challenging the interlocutory denial of its motions. (Jardini Decl. ¶ 86.)   According to Falcon Woods, attorney fees should be reduced by a further $248,639 for these baseless motions.

 

            Additionally, Alpine sought to amend the complaint for a third time; this time to add Falcon Woods’ beneficial owner, Michael Mak, as a defendant. After the Court denied the motion for leave to amend, Alpine filed an equally unsuccessful writ petition challenging the Court’s interlocutory decision. The total cost for this procedural maneuver was $117,054.50.

 

            Here, Falcon Woods conflates unsuccessful with frivolous. Unsuccessful motions are still recoverable and not necessarily unreasonable. (City of Sacramento v. Drew (1989) 207 Cal. App. 3d 1287, 1303 [“Litigation often involves a succession of attacks upon an opponent’s case; indeed, the final ground of resolution may only become clear after a series of unsuccessful attacks. Compensation is ordinarily warranted even for unsuccessful forays.”].) Moreover, the Court cannot say that the motion for leave to amend was an unnecessary or unreasonable procedural effort.

 

            Alpine’s Reply notes that the Court’s prior summary judgment ruling on Falcon Woods’ and Gooding’s motions did not foreclose Alpine’s later motion seeking adjudication on the limited issue that Gooding and Falcon Woods owed it a contractual duty to deliver possession and title to the Ferrari to Alpine. (Bransten Reply Decl., ¶ 4, Ex. C.)

 

Legal Overstaffing and Overbilling:

 

            Falcon Woods also argues that fees should be reduced to address “overstaffing.” Specifically, Falcon Woods notes that Alpine used the services of 21 timekeepers. (Jardini Decl., ¶¶ 50–51.) Notably, Falcon Woods cites the fact that the Dentons timekeepers made 19 appearances with two or more attorneys (at motions, status conferences, depositions, and mediations), but the lack of complexity of the case did not warrant multiple attorneys attending court hearings or depositions (Jardini Decl., ¶¶ 131-132.) Thus, according to Falcon Woods, reasonable staffing would have reduced Dentons’ billed amount by $253,097 and Glaser Weil’s billed amount by $136,320 for overstaffing, and $52,552.25 for duplicative time incurred. (Jardini Decl., ¶¶ 58, 61, 133.)

 

However, the opposition does nothing more than indicate that multiple attorneys were used in this case. That is, Falcon Woods suggests a per se rule that two attorneys at a hearing is inherently duplicative and must be reduced, but this is not the law. Unlike the challenge for overhead billing and clerical billing, Falcon Woods provides no specific evidence of instances of inappropriate overstaffing or duplication.  

 

            Falcon Woods also challenges the fees incurred for the Dentons attorney’s travel fees. For example, Falcon Woods notes that the Dentons attorneys from the Chicago office billed for many trips to Los Angeles, even though Dentons has a Los Angeles office, and attorneys from that office were billing on the matter. (Jardini Decl., ¶ 134; see Rey v. Madera Unified School Dist. (2012) 203 Cal.App.4th 1223, 1241 [recovery of higher rates for out-of-town counsel requires sufficient showing that hiring local counsel was impracticable].)

 

            This challenge, which is not addressed on reply, is well taken. Alpine’s fees will be reduced by $98,552 for unnecessary travel.

 

            Falcon Woods also challenged the amount of fees incurred from interoffice communications. Specifically, Falcon Woods contends that, for this non-complex matter, conferencing should be 5% or lower of the total hours worked, yet Dentons and Glaser billed for conferencing at a much higher rate. It contends that Alpine’s fees should be reduced by $190,494. (Jardini Decl., ¶ 135.) There is some merit to this argument. The billing records show numerous entries for “team calls” and different billing entries for presumably the same call. (See e.g., Entry 10/17/2023.) However, the 5% ceiling is arbitrary.  Communications among multiple timekeepers can enhance efficiency. A certain amount of interoffice communication is reasonable and necessary. Based on its experience with such litigation, the Court will reduce fees by $80,000.

 

Billing Increments:

 

            Next, Falcon Woods argues that the appropriate minimum billing increment is one-tenth of an hour, citing State Bar Arbitration Advisory 2016-02, Analysis of Potential Bill Padding and Other Billing Issues (Bill Padding Advisory). Nonetheless, Glaser Weil attorneys engaged in a billing increment practice of quarter-hour increments, thereby inflating their fees. According to Falcon Woods, this billing method reduces accuracy and has been proven to highly inflate billing because every task or entry must be at least .25 of an hour, or 15 minutes. (Jardini Decl. ¶ 161.)

 

Falcon Woods requests a reduction of .15 hours for each entry to account for the overbilling caused by this billing practice—resulting in a total reduction of $123,751. (Jardini Decl. ¶ 161.)

 

Whether best practices or not, nothing prevents Alpine’s attorneys from using a 15-minute inquiry billing system. It is arbitrary to find that such increments warrant a wholesale reduction of fees; instead, the burden remains on Falcon Woods to show that specific billing entries were excessive for the tasks identified.

 

Vague Description Entries:

 

            Falcon Woods challenges the vague billing entries used by Alpine’s timekeepers. For example, Dentons’ timekeepers used vague billing descriptions—such as “strategy,” “various correspondence,” “research,” and “mediation issues.” (Jardini Decl., ¶ 147.) Falcon Woods argues that Alpine’s fees should be reduced by $190,916.62 to address these vague entries. (Jardini Decl., ¶¶ 147–153.)

 

Vague entries obscure a court’s ability to assess the reasonableness of a fee request, justifying a reduction of the fees. (See e.g., Maughan v. Google Technology (2006) 143 Cal.App.4th 1242, 1251 [affirming trial court’s reduction of fees and costs from $112,288 to $23,000, in part because the time sheets submitted were “somewhat vague in their descriptions of what precisely defense counsel was doing for the claimed amount of time”].)

 

There are a number of Alpine’s counsel’s billing entries that would benefit from greater detail in the description. But the billing entries are not so vague as to preclude determining their reasonableness. In any case, attorney bills are not even required to be produced on a motion for attorney fees. The Court can generally understand the nature of the work described in the context of the litigation.

 

Fees Incurred Preparing for Trial:

 

Citing Clemens v. New York Central Mutual Fire Insurance Company (3d Cir. 2018) 903 F.3d 396, Falcon Woods argues that Alpine also excessively billed on various tasks, most notably for trial preparation and in preparing the attorney fees motion. (See e.g., id. At 401-403 [calling 562 hours a “staggering” and “outrageous” number of hours billed for preparing for a 4-day trial.].) Here, for the 4-day trial, Alpine’s counsel billed 673 hours, which Falcon Woods notes is almost 4 times the number of hours billed by Gooding for the same trial. (Jardini Decl. ¶¶ 121–123.) Notably, this approximates to about four months of work for four days of trial. Falcon request that the time on trial preparation for Alpine’s counsel be reduced by at least 300 hours or $242,559.

 

Trial preparation is always the costliest and most high stakes time in a case.  All parties were aware of that when they chose to try the matter rather than settle it.  The Court declines to reduce the hours or fees for Alpine’s trial preparation.

 

Fees Incurred on this Motion:

 

            Alpine’s current and former counsel purportedly billed roughly $130,000 for 157 hours on its fees motion. (Jardini Decl., ¶¶ 106–118.) While the attorney fee motion certainly represents a substantial sum of money and logically would seem to require a large number of hours to address, the two are not directly correlated.

 

            In fact, the motion – while time consuming to address Falcon Woods’ numerous objections – is not a legally complicated attorney fees motion. There is no dispute over the prevailing party, and rather the matter turns mostly on the reasonableness of the fees – which neither the moving papers nor the reply spend an inordinate amount of detail addressing.

 

            The fees sought in connection to the motion for attorney fees must be reduced by $65,000.

 

Non-chargeable Overhead costs:

 

Falcon Woods also seeks to reduce fees incurred on clerical/overhead work.

 

California authority permits a trial court to disallow attorney rates for clerical work. (See Save Our Uniquely Rural Community Environment v. County of San Bernardino (2015) 235 Cal.App.4th 1179, 1186-1187 [the trial court “could reasonably have determined that billing at partner rates for” “some work that appears ... to be clerical” was “excessive”].)

 

Falcon Woods identifies numerous billing entries for clerical/overhead work. (Jardini Decl. ¶¶ 136–143 [Examples of Overhead].) The reply does not address the challenge to these fees. If Alpine wished to recover [s]ecretarial [or] paralegal” rates, Alpine should have claimed the work properly. (See Mountjoy v. Bank of America, N.A. (2016) 245 Cal.App.4th 266, 280 [“It is the obligation of the party (and attorney) seeking the fee award ‘to prune the fee request to comply with the law,’ and the party (and attorney) cannot ‘transfer that responsibility onto the trial court.’ ”].) Attorney’s fees must be reduced by $21,119.76 for clerical services.

 

Total Reductions:

 

            The Court grants Alpine’s motion for attorney’s fees in the reduced amount of $2,471,005.86.

 

 

Reductions

Total

Original Lodestar Amount

 

$2,943,834.75

Apportionment for Tort Issues

$208,157.13

 

Travel Fees

$98,552

 

Interoffice communication

$80,000

 

Fee Motion

$65,000

 

Clerical work

$21,119.76

 

Reduced Lodestar Amount

$472,828.89

$2,471,005.86

 

 

Gooding’s Motion for Attorney Fees:

 

Gooding seeks attorneys’ fees in the amount of $844,986. Falcon Woods opposes the motion.

 

Gooding argues it is entitled to reasonable fees pursuant to the indemnification provision and the attorney fee provision in the Consignment Agreement between Gooding and Falcon Woods. Specifically, after trial, the Court found in favor of Alpine on its claim that it was entitled to specific performance on the sale of the Ferrari from Gooding. In reaching this conclusion, the Court found that as a result of Falcon Woods’s conduct in agreeing to lower the reserve price on the vehicle in question and then reneging on that agreement, Gooding was entitled to indemnification and defense from Falcon Woods. In its statement of decision, the Court held: “To the extent Gooding is liable to Alpine, Falcon Woods must indemnify Gooding, including for attorney’s fees” (Statement of Decision, p. 20.)

 

            In opposition, Falcon Woods does not dispute that Gooding is entitled to attorney fees. Instead, the opposition – which consists of less than a page of analysis – argues that Gooding’s fee request should be reduced to a total of $699,690.69.

 

            In challenging the amount of the fees, Falcon Woods argues that fees must be reduced to account for overstaffing and overuse of partner time billing (as opposed to attorneys with lower billing rates). Falcon Woods notes that Gooding utilized 13 timekeepers but relied primarily on partner billing (77%). Falcon Woods argues the Court must reduce fees to reflect a reasonable apportionment of lower level tasks to lower-rate timekeepers; as such, Gooding’s fees should be reduced by $84,499. (Jardini Decl., ¶ 79.)

 

            In response Gooding argues that Falcon Woods fails to provide legal authority that limits a law firm’s discretion in how it staffs its firm and how it manages the work assignments to the attorneys in a firm. Here, it was not unreasonable for two attorneys to handle nearly all the work, with a third attorney assisting at trial. Further, the reply notes that neither Falcon Woods, nor its expert identify any specific tasks that they contend should have been performed by a more junior attorney.

 

            The Court has reviewed the billing records and has identified multiple entries that suggest a junior attorney would have been capable of handling a specific task. (Ledal Decl., Ex. A [See e.g., Billing Entries 1/20/19-1/23/19]; see also 5/2019, 8/8/19, 8/20/19-8/21/19].) However, as argued by Gooding, it is not appropriate for the Court to micromanage a law firm’s staffing decisions. Nonetheless, given the use of partners with expertise worthy of $900 an hour rate, the Court finds that many of these tasks could have been completed more efficiently, suggesting overbilling by Gooding. Thus, the Court will reduce fees by $20,000 on this ground.

 

            Further, Falcon Woods argues Gooding’s fees must be further reduced by $46,311 for the timekeeping entries which were impermissibly vague, specifically as to Attorney Meyer. (See Jardini Decl., ¶¶ 154-155 Ex. Examples of Vague Billing schedule [e.g., “attention to discovery request” 4/22/2019].) These entries are impermissibly vague and make it difficult to ascertain the reasonableness of the hours incurred because the Court is unable to determine even the general nature of the work conducted. The Court will reduce fees by $12,000.

 

            Finally, Falcon Woods argues that Gooding’s counsel billed over $14,485.31 for overhead/clerical work. (Jardini Decl., ¶¶ 144-146.) As demonstrated by the example of clerical billing in the Jardini declaration, this ground is well taken.

 

Total Reductions:

 

            The Court grants Gooding’s motion for attorney’s fees in the reduced amount of $798,500.69.

 

 

Reductions

Total

Original Lodestar Amount

 

$844,986

Excessive Billing

$20,000

 

Vague Entries

$12,000

 

Clerical work

$14,485.31

 

Reduced Lodestar Amount

$46,485.31

$798,500.69

 

            Dentons and Glaser Weil are entitled to attorneys’ fees incurred by Alpine in the amount of $2,471,005.86.  The law firms are requested to meet and confer and present to Gooding’s counsel within fifteen days of this order the allocation of fees between the two firms to be distributed from the sale proceeds for the Ferrari.  Gooding shall remit to its counsel the fees ordered above from the sale proceeds.  Plaintiffs’ counsel shall also confer with Gooding with respect to the appropriate reimbursement of costs from the sale proceeds in the amounts claimed in the memoranda of costs.



[1]            Alpine filed a Memorandum of Costs on September 14, 2023 seeking $123,555.34 in costs; no party filed a motion to tax these costs. Gooding also filed a Memorandum of Costs on September 14, 2023 to which no motion to tax was filed.