Judge: Elaine Lu, Case: 21STCP00495, Date: 2023-01-20 Tentative Ruling

Case Number: 21STCP00495    Hearing Date: January 20, 2023    Dept: 26

Superior Court of California

County of Los Angeles

Department 26

Procedural Background

On February 16, 2021, Michael Shemtoub (“Shemtoub”) filed the complaint in this interpleader as to funds obtained pursuant to a settlement agreement arising from an accident. 

On July 29, 2021, the Law Offices of Mark B. Plummer, PC filed a notice of related cases seeking to relate this interpleader with case 21STCV07083.  On August 2, 2021, the Court found the two actions unrelated.  (Minute Order 8/2/21.)

On December 23, 2021, Shemtoub filed a motion for discharge of liability as to the interpleaded funds and dismissal of Shemtoub from the interpleader action.  On January 26, 2022, the Court denied Shemtoub’s motion to be discharged due to Shemtoub’s failure to serve all named defendants and due to inconsistencies in the complaint.  (Order 1/26/22.) 

On February 15, 2022, Plaintiff filed the operative First Amended Complaint (“FAC”) in interpleader against defendants Vial Solutions Medical Group, California Imaging Network, Providence Saint Joseph Medical Center, the Rawling Company, Bright Star Physical Therapy, California Back and Pain Specialist, Dr. Randy Rosen, Guadalupe Rosas, and Cristina Rosas. 

On November 9, 2022, Plaintiff filed the instant motion to seeking discharge of liability as to the interpleaded funds and dismissal of Shemtoub from the interpleader action.  No opposition or reply has been filed.

Allegations of the Operative Complaint

The FAC alleges that:

Shemtoub was the attorney for Guadalupe Rosas and Christina Rosas in a personal injury action arising from a car accident that occurred on July 9, 2012.  (FAC ¶¶ 4-5.)  Guadalupe Rosas and Christina Rosas sought medical treatment and services for injuries from the remaining defendants, who agreed to provide medical services on a lien against the settlement fund.  (FAC ¶ 6.) 

Guadalupe Rosas received a settlement of $23,750.00.  (FAC, Exh. C.) Guadalupe Rosas incurred medical bills in the amounts of:

Vital Solutions Medical Group $1,462.72

California Imaging Network $5,660.00

Providence Saint Joseph Medical Center $1,865.00

The Rawlings Company $1,155.25

Dr. Randy Rosen $1,500.00

Bright Star Physical Therapy $6,575.00

California Back and Pain Specialists $1,250.00

(FAC ¶ 7.) 

Thus far, Defendants have accepted to be paid reduced amounts as follows:

            Vital Solutions Medical Group $800.00

            California Imaging Network $5,660.00

            Providence Saint Joseph Medical Center $900.00

            The Rawlings Company $535.67

            Dr. Randy Rosen $500.00

            Bright Star Physical Therapy $0

            California Back and Pain Specialists $0

(FAC ¶ 8.)

“Plaintiff has the remaining sum of thirteen thousand eighty-two dollars and twenty-two cents ($13,082.22) ready to deposit with the Clerk of this Court, which sum represents the full amount remaining after Plaintiff’s attorneys’ fees and costs earned on the underlying representation obtained in favor of [Guadalupe Rosas] arising out of the accident. This does not include costs for future physical therapy, future examinations, and care and treatment that [Guadalupe Rosas] will incur.”  (FAC ¶ 9.)  At the conclusion of the underlying action, Plaintiff incurred $7,916.67 in attorneys’ fees, $701.00 in materials and postage, and $2,050.11 in filing fees on behalf of defendant Guadalupe Rosas.  (FAC ¶ 11.)

Christina Rosas received a settlement of $22,000.00.  (FAC, Exh. C.) Christina Rosas received medical treatment and incurred bills for medical treatment in the amounts of:

Vital Solutions Medical Group $1,150.32

California Imaging Network $5,660.00

Providence Saint Joseph Medical Center $100.00

The Rawlings Company, Subrogation Division $1,258.08

Bright Star Physical Therapy $7,825.00

California Back and Pain Specialists $1,200.00

(FAC ¶ 20.)

            Thus far the medical provider Defendants have accepted to be paid a reduced amount as follows:

            Vital Solutions Medical Group $500.00

California Imaging Network $0

Providence Saint Joseph Medical Center $100.00

The Rawlings Company, Subrogation Division $578.33

Bright Star Physical Therapy $3,210.00

Dr. Randy Rosen $500.00

California Back and Pain Specialists $550.00

(FAC ¶ 21.)

            “Plaintiff will deposit the remaining sum of eleven thousand nine hundred seventy-eight dollars and ninety-two cents ($11,978.92) with the Clerk of this Court, which sum represents the full amount remaining after Plaintiff’s attorneys’ fees and costs earned on the underlying representation obtained in favor of [Christina Rosas] arising out of the accident. This does not include costs for future physical therapy, future examinations, and care and treatment that [Christina Rosas] will incur.”  (FAC ¶ 22.)  At the conclusion of the underlying action, Plaintiff incurred $7,333.33 in attorneys’ fees, $701.00 in materials and postage, and $1,986.75 in filing fees on behalf of defendant Christina Rosas.  (FAC ¶ 24.)

            “Given the Defendants competing claims for the funds with [Guadalupe Rosas and Christina Rosas], Plaintiff cannot determine which of said Defendants in Interpleader are entitled to the funds and cannot pay any part of the funds without risk of being sued by each of said Defendants.”  (Id. ¶ 28.)

Legal Standard

            Pursuant to Code of Civil Procedure section 386(b), “[a]ny person, firm, corporation, association or other entity against whom double or multiple claims are made, or may be made, by two or more persons which are such that they may give rise to double or multiple liability, may bring an action against the claimants to compel them to interplead and litigate their several claims.”  (Id.) 

“ ‘[I]nterpleader is an equitable proceeding in which the rights of the parties, as between themselves, are governed by principles of equity.’ [Citations.] ‘The purpose of interpleader is to prevent a multiplicity of suits and double vexation. [Citation.] “The right to the remedy by interpleader is founded, however, not on the consideration that a [person] may be subjected to double liability, but on the fact that he [or she] is threatened with double vexation in respect to one liability.” [Citation.]’ (City of Morgan Hill [v. Brown (1999) 71 Cal.App.4th 1114,] [(Brown)].) ‘In an interpleader action, the court initially determines the right of the plaintiff to interplead the funds; if that right is sustained, an interlocutory decree is entered which requires the defendants to interplead and litigate their claims to the funds.’ [Citation.] Then, in the second phase of an interpleader proceeding, the trial court also has ‘the power under section 386 to adjudicate the issues raised by the interpleader action including: the alleged existence of conflicting claims regarding the interpleaded funds; plaintiffs' alleged position as a disinterested mere stakeholder; and ultimately the disposition of the interpleaded funds after deducting plaintiffs' attorney fees.’ [Citation.]” (Shopoff & Cavallo LLP v. Hyon (2008) 167 Cal.App.4th 1489, 1513–1514.)

(Hood v. Gonzales (2019) 43 Cal.App.5th 57, 71–72.)

“A party to an action who follows the procedure set forth in Section 386 or 386.5 may insert in his motion, petition, complaint, or cross complaint a request for allowance of his costs and reasonable attorney fees incurred in such action. In ordering the discharge of such party, the court may, in its discretion, award such party his costs and reasonable attorney fees from the amount in dispute which has been deposited with the court.”  (CCP § 386.6(a).)  “A party shall not be denied the attorney fees authorized by subdivision (a) for the reason that he is himself an attorney, appeared in pro se, and performed his own legal services.”  (CCP § 386.6(b).)

Discussion

            By way of this motion, Shemtoub seeks discharge from liability in the instant action, dismissal from the instant action, and attorney fees and costs of $12,435.00.  Here, given the competing claims of what appears to be two settlement funds, an interpleader is proper.  (See e.g. Hood v. Gonzales (2019) 43 Cal.App.5th 57, 62.)

Shemtoub claims attorney fees and costs consisting of eleven hours drafting the interpleader, seven hours preparing the instant motion, ten hours preparing and attending hearings at $350 an hour.  (Shemtoub Decl. ¶ 4.)  Shemtoub also claims filing fees of $535 and $2,100 in service and filing fees for a total of $12,435 in attorney fees and costs. (Shemtoub Decl. ¶ 4.)

In determining what fees are reasonable, California courts apply the “lodestar” approach. (See, e.g., Holguin v. DISH Network LLC (2014) 229 Cal.App.4th 1310, 1332.)  This inquiry “begins with the ‘lodestar,’ i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate.” (See PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1095.)  From there, the “[t]he lodestar figure may then be adjusted, 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 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.)

Given the simplicity of the issues here, eleven hours claimed drafting the interpleader in the instant action is unreasonable.  The interpleader has been drafted in a confusing way.  For example, the complaint repeatedly uses the term “Defendant Patient” to refer to both Guadalupe Rosas and Christina Rosas.  This is particularly confusing as the two Plaintiffs reached separate settlement amounts and have different and separate claimed medical costs.  (FAC ¶¶ 5-25, Exh. C.)  The interpleader repeatedly alleges that “Plaintiff is informed and believes that the full amount of the balance of DEFENDANT PATIENT with DEFENDANT(S) Defendant totals $10,355.18 (See Exhibit B.)”  (FAC ¶¶ 10, 23.)  There is no indication of which parties the interpleader is referring to.  Moreover, these amounts fail to match the amounts alleged immediately above.  (FAC ¶¶ 7-8, 20-21.)  Moreover, Exhibit B primarily consists of medical documents and insurance forms for Guadalupe Rosas which do not add up to $10,355.18.  In addition, the interpleader appears to include errors.  For example, the bills and statements that appear to be for Defendant Christina Rosas do not include any bill amounts from Dr. Randy Rosas.  However, the “reduced” amount adds an additional non-existent charge of $500 by Dr. Randy Rosas.  (FAC ¶¶ 20-21.)  In sum, eleven hours were not reasonably incurred in drafting the interpleader.  Plaintiff’s delay in effecting service of the complaint and summons necessitated multiple OSCs re proof of service and resulted in unnecessary increases in fees.  Further, in light of the short and simplistic nature of the instant motion, seven hours drafting the instant motion is unreasonable and excessive.  Finally, the claimed ten hours in preparing for and attending the hearing for an uncontested motion is also unreasonable.  All Defendants are in default, and no opposition has been filed. 

Based on the totality of the circumstances, the amount of attorney’s fees requested is excessive and unsupported.  Instead, the Court finds that $6,000 more accurately reflects the attorney fees and costs incurred.

Conclusion and ORDER

Based on the foregoing, Plaintiff Michael Shemtoub’s motion for an order discharging Plaintiff from liability with regard to the interpleaded funds and dismissing Plaintiff is GRANTED.

Plaintiff’s request for attorney’s fees and costs is GRANTED AS MODIFIED.

For good cause shown, relief is proper per Code of Civil Procedure sections 386 and 386.5. Plaintiff Michael Shemtoub is awarded fees and costs in the amount of $6,000. (Code Civ. Proc., § 386.6.)  Within 10 days, Plaintiff is to deposit with the clerk of court $19,061.14 (the amount in dispute, $25,061.14, less attorneys’ fees and costs totaling $6,000). 

The case is set for trial on February 27, 2023 at 8:30 am to determine who among the claimants shall receive the funds interpleaded.  Each claimant must file a written claim within 30 days of this order; the written claim should include a declaration and supporting documentation setting forth the basis for the claim of ownership or interest.  All claimants must appear at the February 27, 2023  disbursement hearing.  Failure to file a written claim within 30 days of this order or failure to appear at the February 27, 2023 disbursement hearing will be deemed waiver of any claim to the interpleaded funds.  If no claims or appearances are made, the matter will be set for an OSC re: Escheating Funds.  Code of Civil Procedure § 128 and Government Code § 68084.1. 

Plaintiff Michael Shemtoub is to give notice of this ruling and of the February 27, 2023 hearing to all defendants, potential claimants, and interested parties, and Plaintiff Michael Shemtoub is to file proof of service of such within 10 days.

Plaintiff Michael Shemtoub is to be discharged from all liability and dismissed from the complaint for interpleader upon: (1) depositing with the clerk of court $19,061.14, and (2) filing of proof of service of notice of this order, including notice of the February 27, 2023 trial date, and proof of service thereof on all defendants, potential claimants, and interested parties.

DATED:  January 20, 2023                                                    ___________________________

Elaine Lu

                                                                                          Judge of the Superior Court