Judge: Gail Killefer, Case: 20STCV33175, Date: 2025-01-23 Tentative Ruling
Case Number: 20STCV33175 Hearing Date: January 23, 2025 Dept: 37
HEARING DATE: Thursday, January 23, 2025
CASE NUMBER: 20STCV33175
CASE NAME: Holly Wiersma v. Frank Logan Levy, et al.
TRIAL DATE: Post Trial
PROOF OF SERVICE: OK
PROCEEDING: Defendants’ Motion for Attorney’s
Fees
MOVING PARTY: Defendants Frank Levy and
Lagniappe Properties CA, LLC
OPPOSING PARTY: Plaintiff Holly Wiersma
OPPOSITION: 15 November 2024
REPLY: 11 December
2024
TENTATIVE: Defense
Counsel Slavkin is awarded $45,080.00 in attorney’s fees. Defense firm is Valle Makoff LLP is awarded $373,143.23 in
attorneys fees. The court declines to award costs until a memorandum of costs
is filed by Defendants. Defendant Logan is entitled to prejudgment interest on
the $200,000.00 in liquidated damages since April 16, 2020 at 10% per annum.
Defendant Lagniappe is entitled to prejudgment interest on the $200,000.00 in
liquidated damages since September 9, 2020 at 10% per annum.
PROCEEDING: Plaintiff’s Motion for
Attorney’s Fees
MOVING PARTY: Plaintiff Holly Wiersma
OPPOSING PARTY: Defendants Frank Levy and Lagniappe
Properties CA, LLC
OPPOSITION: 2 December 2024
REPLY: 6 December
2024
TENTATIVE: Plaintiff Wiersma’s
request for attorney’s fees is denied. Plaintiff’s award of $1,040,229.11 as
against Lagniappe will be reduced by Defendants attorney fee request and in
addition to the $200,000.00 due in
liquidated damages plus prejudgment interest owed separately to both Defendants.
Background
This action arises
out of a dispute over proceeds from the sale of a property located at 7776
Firenze Avenue, Los Angeles, CA 90046 (the “Property”) and a Settlement
Agreement dated December 8, 2019, that was intended to end the dispute between
Plaintiff Holly Wiersma (“Wiersma”) and Defendants Frank Logan Levy (“Logan”)
and an entity he owned, Lagniappe Properties CA, LLC (“Lagniappe”). The
Settlement Agreement, which is at the center of this action, provides in
relevant part:
2. Settlement.
[. . . ]
d.
Sale of the Property. Lagniappe agrees to finish the remodel of the
Property for purposes of sale as soon as reasonably possible. Upon sale of the
Property, the proceeds shall be allocated and distributed in the following
order:
i. Payment of all closing costs, escrow
fees, transfer costs and related costs and fees;
ii. Payment to Lagniappe of all
carrying costs — mortgage, insurance, etc. — from February 1, 2020 until sold;
iii. Payment to Lagniappe and
Wiersma of all costs of remodel from and after the date of this Agreement;
iv. Payment to Lagniappe in the sum of
2.2 million;
v. Remaining sale proceeds shall be [split] 50 – 50 between
Lagniappe and Wiersma.
e. Return
of Property. Wiersma agrees to return to Levy any and all copies of his
private journal that she has in her possession and agrees not to release any
portion of said journal to any individual or entity. In the event that Wiersma
releases any portion of Levy’s journal to any person or entity, Wiersma shall
be in material breach of this Agreement, entitling Levy to receive liquidated
damages as set forth below.
[. . . ]
4. Release.
Except for the obligations created under this Agreement, the Parties on behalf
of themselves and their respective agents, officers, employees, affiliates,
partners, successors, heirs, assigns, and attorneys, fully release and
discharge each other and their respective agents officers, employees,
affiliates, partners, successors, heirs, assigns, and attorneys, from any and
all claims, rights and causes of action, of any nature or sort, known or
unknown, liquidated or unliquidated, past present and future, which they may
have against each other arising out of or relating to the facts and
circumstances which formed the basis of the dispute. This includes, but is not
limited to, any rights to or in the Property by Wiersma and the Wiersma
Allegations.
[. . . ]
6. Liquidated
Damages. In the event Wiersma breaches any provision of this Agreement,
Lagniappe shall be entitled to liquidated damages in the amount of $200,000.00
per breach plus attorney fees and costs. In the event Wiersma breaches
paragraph 2.e of this Agreement, said damages shall be paid directly to Levy.
(Trial Ex. 1.)
On August 20, 2020, Plaintiff filed a
complaint alleging, inter alia, breach of the Settlement Agreement. The operative Third Amended Complaint (TAC),
filed February 23, 2022, alleges 14 causes of action including the first cause
of action for breach of the Settlement Agreement against Logan and Lagniappe.
On August 28, 2023, the court granted Plaintiff’s oral request to dismiss all
causes of action in the TAC except for the first cause of action alleging
breach of the written settlement agreement against Logan and Lagniappe. (8/28/2023
Minute Order.)
Defendants Logan and Coya Levy filed a
Cross-Complaint alleging two causes of action for (1) breach of contract and
(2) defamation. Plaintiff moved for summary adjudication as to the claims in
the claims in the Cross-Complaint. On March 6, 2023, the court granted summary
adjudication in favor of Plaintiff as to the two claims in the Cross-Complaint.
(3/6/2023 MSJ Order.)
Between August 28 and 30, 2023, the court
conducted a bench trial to determine if Plaintiff Wiersma breached the
Settlement Agreement, thus excusing Defendant Lagniappe’s obligation to split
the sale proceeds of the Property. On April 24, 2024, the court issued the
Statement of Decision (the “SOD”). In
the SOD, the court found that Plaintiff Wiersma breached ¶2(e) of the
Settlement Agreement by not returning to Defendant Logan “any and all copies”
of his private journal she had in her possession. She also breached Paragraph 4 of the
Settlement Agreement of the “Release” provision by filing a Lis Pendens against
the Property. Still, her violations were not a material breach of the
Settlement Agreement. Consequently, the court found that under the liquidated
damages provision, Plaintiff must pay both Defendants Logan and Lagniapee
$200,000 in liquidated damages plus attorney fees and costs.
The court also found that Plaintiff
Wiersma prevailed in her breach of contract claim against Defendant Lagniappe
because Lagniappe failed to pay Plaintiff any money from the sale of the
Property on November 17, 2020. Phase 2 of the trial focused on Plaintiff’s
damages and the question of what deductions to allow Lagniappe for costs and
expenses in remodeling the Property before the court split the remaining
proceeds 50/50 between Lagniappe and Wiersma.
On October 11, 2024, the court issued an
Order (the “10/11/2024 Order”) awarding Plaintiff $1,040,299 against Lagniappe,
from which $200,000 to both Defendants, plus their attorney fees and costs,
were to be subtracted. (SOD at p. 13; 10/11/2024 Order at p. 7.)
Both Plaintiff and Defendants have filed
motions for attorneys’ fees and costs and each has filed opposing papers. The
matter is now before the court.
I. Legal Standard
A prevailing party is entitled to recover costs, including
attorneys’ fees, as a matter of right.¿ (CCP §§ 1032(a)(4), 1032(b),
1033.5.)¿Attorney fees may be recovered as costs when authorized by contract,
statute, or law. (CCP § 1033.5(a)(10).)¿The prevailing party on a contract,
which specifically provides for attorney fees and costs incurred to enforce the
agreement, is entitled to reasonable attorney fees in addition to other costs.¿
(Civ. Code § 1717(a); CCP §§ 1032, 1033.5(a)(10)(A).)¿ The court, upon notice
and motion by a party, shall determine the prevailing party and shall fix, as
an element of the costs of the suit, the reasonable attorney fees.¿ (Civ. Code
§ 1717(a), (b).)¿¿¿¿
The fee setting inquiry in California ordinarily “begins with
the ‘lodestar’ [method], i.e., the number of hours reasonably expended
multiplied by the reasonable hourly rate.”¿(Graciano v. Robinson Ford Sales,
Inc. (2006) 144 Cal.App.4th 140, 154.)¿ The lodestar figure may then be
adjusted, based on consideration of factors specific to the case, to fix the
fee at the fair market value for the legal services provided.¿ (See Serrano
v. Priest (1977) 20 Cal.3d 25, 49 (discussing factors relevant to proper
attorneys’ fees award).)¿ The factors considered in determining the
modification of the lodestar 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.”¿(Mountjoy v.
Bank of Am. (2016) 245 Cal.App.4th 266, 271.)
II. Discussion
A. The Parties’ Entitlement to Attorney’s Fees and Costs
The Settlement Agreement contains two provisions for attorney’s
fees and costs, one under the Liquidated Damages provision and a second one
applying to the entire Settlement Agreement. The court found that Liquidated
Damages provision is enforceable against Plaintiff Wiersma due to her breach of
paragraph 2.e and Paragraph 4 of the Settlement Agreement, which states as
follows:
6. Liquidated
Damages. In the event Wiersma breaches any provision of this Agreement,
Lagniappe shall be entitled to liquidated damages in the amount of $200,000.00
per breach plus attorney fees and costs. In the event Wiersma breaches
paragraph 2.e of this Agreement, said damages shall be paid directly to Levy.
(Trial Ex. 1.) Consequently, the court found that Plaintiff
Wiersma owes $200,000, plus attorney fees and costs, to both Defendants Logan
and Lagniappe due to her breaches as specified in the Liquidated Damages
provision.
The court also found that Plaintiff Wiersma was entitled to
attorney’s fees and costs for prevailing on her breach of contract claim
against Defendant Lagniappe, as stated in Paragraph 18 of the Settlement
Agreement:
18. Attorney’s Fees in Enforcement of
this Agreement. If it becomes necessary for any Party hereto to obtain
services of an attorney to enforce the provisions of this Agreement against any
Party who has breached any obligation set forth herein, or any action at law or
equity, including an action for declaratory relief, is brought to enforce or
interpret the provisions of this Agreement the prevailing party shall be
entitled to recover the reasonable attorneys’ fees and costs incurred,
regardless of whether any suit proceeds to final judgment. Any such action
shall be brought in the Superior court of the State of California, Los Angeles.
(Trial Ex. 1.)
Plaintiff Wiersma now asserts that under the Attorney’s Fees
provision in the Settlement Agreement, she alone is the prevailing party, and
she alone is entitled to attorney’s fees under Civ. Code § 1717. Defendants
maintain that the prevailing party is Defendant Logan because Plaintiff
obtained no relief from Logan and owes Logan liquidated damages. Therefore, as
Logan and Lagniapee share the same counsel, their fees and costs “are
inextricably interrelated” and Defendants jointly seek attorney fees and costs.
(D’s Mot. at p. 4:19-22.)
Civ. Code § 1717 provides in the relevant part:
(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.
Where a
contract provides for attorney's fees, as set forth above, that provision shall be
construed as applying to the entire contract, unless each party was represented
by counsel in the negotiation and execution of the contract, and the fact of
that representation is specified in the contract.
[ . . . ]
(b)(1)
The court, upon notice and motion by a party, shall determine who is the party
prevailing on the contract for purposes of this section, whether or not the
suit proceeds to final judgment. Except as provided in paragraph (2), the party
prevailing on the contract shall be the party who recovered a greater relief in
the action on the contract. The court may also determine that there is no party
prevailing on the contract for purposes of this section.
(Ibid.
[emphasis added].)
The court finds that Plaintiff Wiersma may only recover
attorney’s fees if she is the prevailing party under Paragraph 18 of the
Settlement Agreement, which states: “the prevailing party shall be entitled
to recover the reasonable attorneys’ fees and costs incurred, regardless of
whether any suit proceeds to final judgment.” (Trial Ex. 1.) Civ. Code §
1717 allows attorney’s fees to be awarded “either to one of the parties or to
the prevailing party” but does not appear to permit attorney’s fees to two
prevailing parties. “Under section 1717, we must treat the attorney fee clause
as providing for an award of fees to the prevailing party in the contract
action.” (Domestic Linen Supply Co., Inc. v. L J T Flowers, Inc. (2020)
58 Cal.App.5th 180, 186.)
“If neither party
achieves a complete victory on all the contract claims, it is within the
discretion of the trial court to determine which party prevailed on the
contract or whether, on balance, neither party prevailed sufficiently to
justify an award of attorney fees.” (Scott Co. of California v. Blount, Inc.
(1999) 20 Cal.4th 1103, 1109.) However, “a party who obtains an
unqualified victory on a contract dispute, including a defendant who defeats
recovery by the plaintiff on the plaintiff's entire contract claim, is entitled
as a matter of law to be considered the prevailing party for purposes of section
1717.” (DisputeSuite.com, LLC v. Scoreinc.com (2017) 2 Cal.5th 968,
973.)
Here,
Defendant Logan had an unqualified victory because he defeated Plaintiff’s
breach of contract claim and is entitled to liquidated damages against
Plaintiff. Neither Plaintiff Wiersma nor Defendant Lagniappe won a
complete victory because they both breached the Settlement Agreement. Therefore,
Defendant Logan is the prevailing party under Paragraph 18 of the Settlement
Agreement and is the party who is entitled to attorney’s fees pursuant to
section 1717.
While Plaintiff Wiersma
prevailed in her contract claim against Defendant Lagniappe,
the court is aware of no case law or statute permitting the court to find there
are two prevailing parties under section 1717 given that Defendant Logan had an
unqualified win in this action. Even if Paragraph 18 were interpreted to allow
for two prevailing parties, section 1717 still applies. “Parties to a contract
cannot, for example, enforce a definition of ‘prevailing party’ different from
that provided in Civil Code section 1717.” (Walker v. Ticor Title Co. of
California. (2012) 204 Cal.App.4th 363, 373.)
“[W]hen the judgment is a ‘simple, unqualified win’ for one party
on the only contract claims presented, the trial court has no discretion to
deny an attorney fee award to that party under section 1717.” (Zintel
Holdings, LLC v. McLean (2012) 209 Cal.App.4th 431, 439 (Zintel
Holdings).) Given Defendant Logan’s unqualified
win, the court does not have the discretion to find that Plaintiff Wiersma was a
prevailing party under the Settlement Agreement because section 1717 only allows
for one prevailing party when there is an unqualified win for one party. “Thus, when a defendant defeats recovery by
the plaintiff on the only contract claim in the action, the defendant is the
party prevailing on the contract under section 1717 as a matter of law.” (Hsu
v. Abbara (1995) 9 Cal.4th 863, 876 (Hsu); Zintel Holdings, at p. 439 [accord].)
Consequently,
Plaintiff Wiersma’s request for attorney fees and costs is denied as she is not
the prevailing party under the Settlement Agreement and Civil Code § 1717.
B. Defendants’ Request for Attorney Fees and Costs
Defendant
Logan is entitled to attorney’s fees in accordance with Civ. Code § 1717 as the
prevailing party under the Settlement Agreement and under the liquidated
damages provision providing for attorney’s fees. Defendant Lagniappe is only entitled
to attorney’s fees under the liquidated damages provision providing for
attorney’s fees. However, Defendants are only entitled to attorney’s fees
related to the breach of contract claim.
“Apportionment is not required when the issues in the fee and
nonfee claims are so inextricably intertwined that it would be impractical or
impossible to separate the attorney's time into compensable and noncompensable
units.” (Graciano v. Robinson Ford Sales, Inc. (2006) 144 Cal.App.4th
140, 159.) “Where fees are authorized for some causes of action in a complaint
but not for others, allocation is a matter within the trial court's
discretion.” (Amtower v. Photon Dynamics, Inc. (2008) 158 Cal.App.4th
1582, 1604.) “ ‘A court may apportion fees even where the issues are connected,
related or intertwined.’ ”(Zintel Holdings, supra, 209
Cal.App.4th at p. 443.) “ ‘[A]lthough time-keeping and billing procedures may
make a requested segregation difficult, they do not, without more, make it
impossible.’ ” (Heppler v. J.M. Peters Co. (1999) 73 Cal.App.4th 1265,
1297.)
Plaintiff’s opposing papers offer no guidance as to how the court
should apportion fees between the breach of contract claim that are
compensable and those that are not. (See Zintel Holdings, supra,
209 Cal.App.4th at p. 443 [It was an error for the trial court to decline to
apportion fees where both landlord and tenant proposed methods for apportionment].) .
Where
it is possible for the court to differentiate between fees incurred related to
the breach of contract claim and those fees that are not compensable, the court will apportion those fees. However, where the
attorney’s fees are so interrelated that it would be impossible to separate the
time billed between Defendants, the court will not apportion the fees. “‘Allocation
of fees incurred in representing multiple parties is not required,” however,
when the claims at issue are ‘inextricably intertwined,’ such that it is not
possible to differentiate between compensable and noncompensable time.’” (Hill
v. Affirmed Housing Group (2014) 226 Cal.App.4th 1192, 1197 [internal
citations and quotations omitted].) The court may “properly exercise[] its
discretion by not apportioning attorney fees under section 1717 when the
plaintiff's successful and unsuccessful claims were all based on the same
contract and the same contractual relationship.” (In re Tobacco Cases I
(2013) 216 Cal.App.4th 570, 586.)
C. Attorney Fee Request by Wendy L. Slavkin
Defense counsel Wendy L. Slavkin (“Slavkin”) represented
Defendants since 2018, including the signing of the Settlement Agreement. Slavkin
represented Defendants from the filing of this action on August 28, 2020, until
April 2023 when Valle Makoff LLP was substituted in as Defense counsel. (Slavkin
Decl., 3, Ex. A.) Slavkin’s hourly
billing rate for this matter is $400.00 per hour. (Id. ¶ 2.)
Slavkin seeks $56,640 in attorney fees and $2,377.17 in costs,
incurred between January 29, 2020, to April 9, 2023. The court finds Slavkin’s
$400.00 hourly billing rate to be reasonable. However, the court deducts 15.10
hours or $6,040.00 from Slavkin’s fee request for fees incurred prior to
August 28, 2020, because this action was not filed until August 28, 2020 and no
dispute under the Settlement Agreement arose until the filing of this action.
The court deducts 5.5 hours or $2,200.00 related to
Defendants’ demurrer of the Second Amended Complaint because the demurrer
related to Defendant’s Logan’s breach of fiduciary cause of action and not the
compensable breach of contract claim. (See Exxess
Electronixx v. Heger Realty Corp. (1998) 64 Cal.App.4th 698, 702 [finding that Civ. Code § 1717 contractual
fee provision “does not authorize an award of fees on the tort claims
(constructive fraud and breach of fiduciary duty) or the claims for equitable
relief.”].) Defendants again demurred to the breach
of fiduciary duty as alleged in the Third Amended Complaint. The court deducts 1.7 hours or $680.00
for time spent drafting the demurrer to the Third Amended Complaint. Defense
counsel Slavkin also block billed for drafting opposing papers related to
the motion for sanctions and the
anti-SLAPP, with only the former being related to the breach of contract claim.
As the anti-SLAPP motion related to the defamation claim and is not compensable,
the court deducts 5.7 hours or $2,280.00 from the lodestar.
The court also deducts .4 hour or $160.00 for time spent on
administrative tasks such as filing and serving the case management statement
and re-downloading documents to Dropbox. The court deducts .5 hour or $200
for the court appearance on 11/15/2021 regarding the case management statement
as no more than 0.5 hours should have been filled for the matter. The court
makes no further deductions as the court cannot differentiate further between
compensable and non-compensable fees and finds that the other fees are inextricably
intertwined with the breach of contract claim.
Deductions from Slavkin’s fee request total $11,560.00. Therefore,
the court awards Slavkin $45,080.00 in
attorney’s fees. The court declines to award costs until Defense counsel
Slavkin files a memorandum of cost.
D. Attorney Fee Request by Valle Makoff LLP
i. Reasonable
Hourly Rates
“A trial court assessing attorney fees begins with a touchstone or
lodestar figure, based on the ‘careful compilation of the time spent and
reasonable hourly compensation of each attorney ... involved in the
presentation of the case.” (Christian Research Institute v. Alnor (2008)
165 Cal.App.4th 1315, 1321.) “The reasonableness of attorney fees is within the
discretion of the trial court, to be determined from a consideration of such
factors as the nature of the litigation, the complexity of the issues, the
experience and expertise of counsel and the amount of time involved. The court
may also consider whether the amount requested is based upon unnecessary or
duplicative work.” (Wilkerson v. Sullivan (2002) 99 Cal.App.4th 443,
448.)¿¿
Defense firm Valle Makoff LLP began representing
Defendants in March of 2023, with first billing entry being on March 16, 2023. A
total of three attorneys and at least one paralegal worked on this action:
·
Jeffrey B. Valle (Partner) –
bills $890.00/ hour, later increased to $900.00/hour, 153.1 hours billed, total
fee $137,790.00
·
Julie Roback (Senior
Counsel) - bills $600.00/hour, 437.1 hours billed, total fee $262,260.00
·
Stacy Horth-Neubert (Associate)–
bills $485.00/hour, 389.55 hours billed, total fee $188,931.75
·
Paralegal – bills
$200.00/hour, 58.9 hours billed, total $11,780.00
(Valle Decl., ¶¶ 12, 19)
Defense counsel Valle asserts that to keep costs reasonable, Robak
and Horth-Neubert performed most of the tasks. (Valle Decl., ¶ 12.) Excluded
from the fee request are matters related
to Phase 2 of the trial for permitted deductions. (Id. ¶ 10.) Defense
counsel Valle also excluded the time spent corresponding with Plaintiff’s
former husband, Cassian Elwes. (Id. ¶ 13.)
Defense counsel Valle has 41 years of experience and asserts his
usual hourly billing rate is $1000.00/hour.
For this matter he agreed to a reduced billing rate of $850.00 per hour,
later increased to $900.00 per hour. (Valle Decl., ¶ 14.) Roback is senior counsel
and has over 30 years of experience. Roback seeks an hourly rate of $600.00 per
hour despite agreeing to represent Defendants at a reduced hourly fee of
$550.00 per hour. (Id., 15.) Horth-Neubert
has 19 years of experience and worked on this action until she was pulled into
another case. Her billing rate is $485.00 per hour.
Defense counsel Valle and Roback inflated their hourly fee request
because they believed the higher hourly fees best reflect the market value of
their services despite agreeing to represent Defendants at a reduced hourly
rate. “[T]he term ‘attorney's fees’ is generally defined as meaning the
consideration that a litigant ‘actually pays or becomes liable to pay in
exchange for legal representation.’” (PLCM Group v. Drexler (2000) 22
Cal.4th 1084, 1097.) Here, Defendants agreed to pay attorney’s fees in the
amount of $850.00/hour for counsel Valle
and $550.00/hour for counsel Roback. “[U]nder the Supreme Court's reading of
the statute, the object of the provision in section 1717 allowing the recovery
of ‘reasonable attorney's fees' is to reimburse a party for attorney fees the
party has paid, or to indemnify the party for fees the party has become liable
to pay[.]” (Id. at p. 1102.)
The appropriate manner to seek an increase a fee award is by
requesting a fee enhancement multiplier and not by increasing the attorney’s
hourly rate beyond that agreed by the client. . (See Ketchum v. Moses
(2001) 24 Cal.4th 1122, 1134 [“We again explained that the lodestar figure may
be increased or decreased depending on a
variety of factors . . .”].) “[T]he trial court should consider whether, and to
what extent, the attorney and client have been able to mitigate the risk of
nonpayment, e.g., because the client has agreed to pay some portion of the
lodestar amount regardless of outcome.” (Id. at p. 389.) The California
Supreme Court further explained that “when determining the appropriate
enhancement, a trial court should not consider” “[t]he factor of extraordinary
skill” because it is “already encompassed in the lodestar” and is “susceptible
to improper double counting” such that the “trial court should award a
multiplier for exceptional representation only when the quality of
representation far exceeds the quality of representation that would have been
provided by an attorney of comparable skill and experience billing at the
hourly rate used in the lodestar calculation.” (Id. at pp. 1138-1139.) “Otherwise,
the fee award will result in unfair double counting and be unreasonable.” (Id.
at p. 1139.)
As no fee enhancement multiplier is sought, Defense Counsel
improperly inflated their fee request by increasing their hourly rate beyond
that agreed to by Defendants. “A fee request that appears unreasonably inflated
is a special circumstance permitting the trial court to reduce the award or
deny one altogether.” (Serrano v. Unruh (1982) 32 Cal.3d 621, 635.)
The court finds that a reasonable hourly rates for counsel Valle and
counsel Roback are the agreed upon hourly rate of $850.00/hour and $550.00/hour.
· $850.00/hour x 153.1 hours = $130,135.00; $137,790 -
$130,135.00 = $7,655.00
·
$550.00/hour x 437.1 hours
= $241,175.00; $262,260 - $241,175.00 = $21,085.00
The court finds that the $485.00 hourly rate of counsel
Horth-Neubert is reasonable and makes no reductions to her hourly rate.
Therefore, only $28,740.00 will be deducted from the lodestar.
i. Reasonable Hours
Billed
The burden is on the party seeking attorney’s fees to prove that
the fees it seeks are reasonable. (See Vines v. O'Reilly Auto Enterprises,
LLC (2022) 74 Cal.App.5th 174, 184.) But “ ‘[i]n challenging attorney fees
as excessive because too many hours of work are claimed, it is the burden of
the challenging party to point to the specific items challenged, with a
sufficient argument and citations to the evidence. General arguments that fees
claimed are excessive, duplicative, or unrelated do not suffice.’ ” (Lunada
Biomedical v. Nunez¿(2014) 230 Cal.App.4th 459, 488 citing Premier
Medical Management Systems, Inc. v. California Ins. Guarantee Assn. (2008)
163¿Cal.App.4th¿550, 564.)¿¿
Plaintiff Wiersma’s opposition did not challenge any billing
entries by Defense counsel. Valle Makoff LLP’s billing statements are attached
as Exhibit A to the Jeffrey B. Valle Declaration.
Having reviewed the billing entries, the court makes the following
deductions:
a. Hours Billed
Related to Section 437(b) Motion
Valle Makoff LLP’s billing statements show that between March 28,
2023, and April 10, 2023, a paralegal billed for research related to the CCP §
437(b) motion, as did Partner Valle and Senior Counsel Roback. Moreover, both
Defense Counsel Slavkin and attorneys for Valle Makoff LLP billed for matters
related to the § 437(b) motion. This resulted in duplicative work and
inefficient billing.
The court deducts 37.3 hours or $31,634.17 billed at an
hourly rate of $850.00/hour from the lodestar
b. Time Billed for Travel
Defense counsel block billed for time spent traveling for trial. California
case law holds that attorneys are compensated for travel costs, not for the
attorney's time spent traveling. “As to the out-of-town travel expenses, the
court finds that item to be reasonable in amount and the type of expense that
would ordinarily be charged to the client. In the circumstances of this case,
the court concludes that equity requires that plaintiffs' counsel be reimbursed
for travel expenses necessarily incurred during the litigation.” (Keith v.
Volpe¿(C.D. Cal. 1980) 501 F.Supp. 403, 414–415.) “The trial court did not
err in awarding costs incurred by Bakersfield attorneys to attend depositions
in San Diego County.” (Thon v. Thompson (1994) 29 Cal.App.4th 1546,
1548.) “The court did not abuse its discretion in allowing the costs of travel
to and from depositions in New Mexico and Texas.” (Chaaban v. Wet Seal, Inc.
(2012) 203 Cal.App.4th 49, 60.)
The court deducts 4.0 hours billed at $850.00/hour or $3,400.00
for the time spend traveling to the court to attend trial.
c. Clerical Tasks
Defense counsel’s billing statements
contain various billing entries for clerical and administrative tasks, such as
calendaring, uploading documents, and filing and serving documents, that are
not compensable tasks. “‘It is appropriate to distinguish between legal work,
in the strict sense, and investigation, clerical work, compilation of facts and
statistics and other work which can often be accomplished by non-lawyers but
which a lawyer may do because he has no other help available. Such non-legal
work may command a lesser rate. Its dollar value is not enhanced just because a
lawyer does it. ’” (Missouri v. Jenkins by Agyei (1989) 491 U.S. 274,
288, fn. 10.) “[T]he filing, transcript, and document organization time was
clerical in nature and should have been subsumed in firm overhead rather than
billed at paralegal rates.” (Nadarajah v. Holder (9th Cir. 2009) 569
F.3d 906, 921.) “However, clerical and other overhead expenses are
ordinarily included in an attorney's hourly rates and are not separately
recoverable unless they represent expenses ordinarily billed to a client.” (City
of Oakland v. McCullough (1996) 46 Cal.App.4th 1, 7.)
The billing entries for defense
counsel request fees for clerical and administrative tasks related to: “Provid[ing]
technical support for remote appearance”; “Request[ing] paralegal to check
docket”; “check docket”; “Check court's online docket for minute order from
submitted matter; Download and save minute order;” “Calendar check”; “review
schedule”; “; Calendar court dates ordered by the court”; “File and serve
statement for status conference; Research court docket”; “Forward service email
to opposing counsel”; “draft task list”; “Download and save filed copies of
four Substitutions of Attorney”; “Set up Zoom meeting and send invitations for
Zoom meeting”; “File and serve upon all parties as required by California rules
of civil procedure”; “File and serve Logan’s Trial Brief”; “serve defendant’s
exhibits to opposing counsel”; “confer with SRH and paralegal re filing of
final brief”; “instruct paralegal to file; correspond with client”; and “confer
with paralegal re filing of fee motion and dates”. (See Valle Decl., Ex. A.)
The court finds that a
negative multiplier of .20 is warranted to account for billing errors caused by
various attorneys’ billing for administrative and clerical tasks. (See Nadarajah
v. Holder (9th Cir. 2009) 569 F.3d 906, 921 [“When clerical tasks are
billed at hourly rates, the court should reduce the hours requested to account
for the billing errors.”].)
A .20 negative multiplier
will be applied to the lodestar.
d. Billing for Fee
Motion
Defense counsel Roback billed
21.1 hours in drafting the initial fee motion, and 15.00 hours drafting the
reply, while Counsel Valle billed an additional 1.0 to review the reply, and a
paralegal spent 1.0 hour filing and serving the reply. (Valle Decl., Ex. A; Supp,
Valle Decl., ¶ 2.)
The court finds the hours
billed by Defense counsel are excessive and Defense counsel should have spent
no more than 12 hours on the matter. The court deducts 21.5 hours billed at
$550.00 per hour or $12,155.00 from the lodestar as well as $1,100.00
for the hours billed by the paralegal and counsel Valle.
E. Adjusted Lodestar
Defendant Valle Makoff LLP’s invoices
show that the lodestar is $569,746.75:
04/15/2023
Invoice No. 8469 - $67,185.00 (totaling $67,326.00 with costs)
05/15/2023
Invoice No. 8486 - $13,189.05 (totaling $13,906.95 with costs)
06/15/2023
Invoice No. 8547 - $24,722.00 (totaling $24,845.00 with costs)
07/15/2023
Invoice No. 8573 - $38,507.75
08/15/2023
Invoice No. 8614 - $143,834.75 (totaling $144,061.75 with costs)
09/15/2023
Invoice No. 8652 – $107,921.70 (totaling $110,570.50 with costs.)
09/30/2023
Invoice No. 8674 - $22,052.50
10/31/2023
Invoice No. 8719 - $44,251.00 (totaling $58,035.27 with costs)
11/30/2023
Invoice No. 8785 - $48.50 (totaling $220.00 with costs)
12/31/2023
Invoice No. 8858 - $260.00
01/31/2024
Invoice No. 8883 - $42,025.00
02/29/2024
Invoice No. 8950 - $18,145.00 (totaling 18,346.00 with costs.)
03/31/2024
Invoice No. 8984 - $4,880.00 (totaling $5,061.00 with costs)
04/30/2024
Invoice No. 9064 - $2,945.00
05/31/2024
Invoice No. 9162 - $4,590.00 (totaling $4,696.00 with costs)
06/30/2024
Invoice No. 9192 - $4,565.00
07/31/2024
Invoice No. 9265 - $5,190.00 (totaling $5,350.00 with costs)
10/29/2024
Invoice No. 9442 - $25,435.00
Total: $569,746.75
Deductions by Defense counsel as
indicated on invoices are as follows:
4/15/2023 Invoice No. 8469 – Deductions total: $4,180.00
·
03/20/2023
- for the block entry related to “Review backup re expenses,” the entry is
crossed out, but no deduction is made so the court deducts 0.6 hour billed at
$550.00/hour or $330.00 from the lodestar.
·
03/28/2023
- for the block entry related to “review deduction evidence; confer with
paralegal re same,” the entry is crossed out, but no deduction is made so the
court deducts 5.0 hours billed at $550.00/hour or $2,750.00 from the
lodestar.
·
03/30/2023,
for the block entry related to “Review paralegal's analysis of back up material
submitted with motion,” the entry is crossed out, but no deduction is made so
the court deducts 2.0 hours billed at $550.00/hour or $1,100.00 from the
lodestar.
05/15/2023 Invoice No. 8486 – Deductions total: $6,922.00
·
04/25/2023
- for the block entry related to “email client re deductions” the court deducts
$165.00 from the lodestar.
·
04/26/2023
– the court deducts $267.00 from the lodestar as this entry is crossed
out.
·
05/01/2023
– the court deducts $1,100.00 from the lodestar as this entry is crossed
out.
·
05/02/2023
– the court deducts $610.00 from the lodestar as these entries are
crossed out.
·
05/03/2023
– the court deducts $1,430.00 from the lodestar as this entry is crossed
out.
·
05/04/2023
– the court deducts $165.00 from the lodestar as this entry is crossed
out.
·
05/5/05/2023
- for the block entry related to “comment on chart re expenses from client,”
the entry is crossed out, but no deduction is made so the court deducts 0.6 hour
billed at $550.00/hour or $330.00 from the lodestar.
·
05/08/2023,
for the block entry related to “Email and call with client re expenses,” the
entry is crossed out, but no deduction is made so the court deducts 3.5 hours
billed at $550.00/hour or $1,925.00 from the lodestar.
·
05/10/2023
- the court deducts $715.00 from the lodestar as this entry is crossed
out.
·
05/15/2023
- the court deducts $825.00 from the lodestar as this entry is crossed
out.
06/15/2023 Invoice No. 8547 - Deductions total: $2,630.00
·
05/16/2023,
for the block entry related to “Work on meet and confer re deductions,” the
entry is crossed out, but no deduction is made so the court deducts 2.0 hours
billed at $550.00/hour or $1,100.00 from the lodestar.
·
05/18/2023,
the court will deduct $320.00 from the lodestar as this entry is crossed
out.
·
05/22/2023,
for the block entry related to “work on deduction issue,” the entry is crossed
out, but no deduction is made so the court deducts 0.6 hour billed at
$550.00/hour or $330.00 from the lodestar
·
05/23/2023,
the court will deduct $460.00 from the lodestar as these entries are
crossed out.
·
05/24/2023,
the court will deduct $140.00 from the lodestar as these entries are
crossed out.
·
05/25/2023,
the court will deduct $60.00 from the lodestar as these entries are
crossed out.
·
05/3/02023,
the court will deduct $220.00 from the lodestar as these entries are
crossed out.
07/15/2023 Invoice No. 8573 - Deductions total: $5,116.75
·
07/11/2023
- the court will deduct $1,649.00 from the lodestar as the entry is
crossed out.
·
07/12/2023
- the court will deduct $3,346.50 from the lodestar as the entry is
crossed out.
·
07/14/2023
-the court will deduct $121.25 from the lodestar as the entry is crossed
out.
08/15/2023 Invoice No. 8614: Deductions total: $3,694.25
·
07/13/2023,
the court will deduct $121.25 from the lodestar as this entry is crossed
out.
·
07/19/2023,
the court will deduct $48.50 from the lodestar as this entry is crossed
out.
·
07/19/2023,
the court will deduct $242.50 from the lodestar as this entry is crossed
out.
·
07/20/2023,
the court will deduct $97.00 from the lodestar as this entry is crossed
out.
·
08/08/2023,
for the block entry related to “prep expenses materials for damages phase,” the
entry is crossed out, but no deduction is made so the court deducts 2.00 hour
billed at $485.00/hour or $970.00 from the lodestar.
·
08/10/2023,
for the block entry related to “updating permitted deductions calculations”,
the entry is crossed out, but no deduction is made so the court deducts 2.00
hour billed at $485.00/hour or $970.00 from the lodestar.
·
08/11/2023
- for the block entry related to “confer with team re expenses,” the entry is
crossed out, but no deduction is made so the court deducts 0.5 hour billed at
$550.00/hour or $275.00 from the lodestar.
·
08/22/2023-
for the block entry related to “revise permitted deductions calcs, ” the entry
is crossed out, but no deduction is made so the court deducts 2.00 hour billed
at $485.00/hour or $970.00 from the lodestar.
·
For
the block entry related to “prep expenses materials for damages phase,” but no
deduction is made so the court deducts 2.00 hour billed at $485.00/hour or $970.00
from the lodestar.
09/15/2023 Invoice No. 8652 – N/A
09/30/2023 Invoice No. 8674 – N/A
10/31/2023 Invoice No. 8719 – N/A
11/30/2023 Invoice No. 8785 – N/A
12/31/2023 Invoice No. 8858 – N/A
01/31/2024 Invoice No. 8883 – N/A
02/29/2024 Invoice No. 8950 – N/A
03/31/2024 Invoice No. 8984 – N/A
04/30/2024 Invoice No. 9064 – N/A
05/31/2024
Invoice No. 9162 – Deductions total: $550.00
·
05/13/2024
- for the block entry related to “review deductions worksheet,” the entry is
crossed out, but no deduction is made so the court deducts 1.0 hours billed at
$550.00/hour or $550.00 from the lodestar.
06/30/2024 Invoice No. 9192 – N/A
07/31/2024 Invoice No. 9265 – N/A
10/29/2024
Invoice No. 9442 – Deductions total: $3,195.00
·
10/01/2024
- the court will deduct $395.00 from the lodestar as these entries are
crossed out.
·
10/02/2024
- the court will deduct $2,800.00 from the lodestar as these entries are
crossed out.
Deductions in the invoices total $26,288.00,
bringing the lodestar to $543,458.75.
·
$569,746.75 - $26,288.00 = $542,458.75.
Additional deductions made by the court
total $77,029.17. With deductions, the lodestar is $466,428.83. After applying
a 20% negative multiplier, totaling $93,285.60, Defendants’ new lodestar is $373,143.23.
The court awards Defense
Counsel Valle Makoff LLP $373,143.23 in attorney fees. The court declines to award costs until a
memorandum of costs is filed.
F. Request for Prejudgment Interest on Liquidated
Damages
Defendants assert they ae
entitled to prejudgment interest on their liquidated damages pursuant to Civ.
Code § 3287(a):
A person who is entitled to recover damages certain, or capable of
being made certain by calculation, and the right to recover which is vested in
the person upon a particular day, is entitled also to recover interest thereon
from that day, except when the debtor is prevented by law, or by the act of the
creditor from paying the debt. This section is applicable to recovery of
damages and interest from any debtor, including the state or any county, city,
city and county, municipal corporation, public district, public agency, or any
political subdivision of the state.
The court finds that
Defendant Logan is entitled to prejudgment interest for the $200,000.00 owed
since April 16, 2020 when Plaintiff Wiersma emailed Defendant Logan a photograph
of his private Journal. (Order 04/24/2024 at p. 7.)
The court also finds that
Defendant Lagniappe is entitled to prejudgment interest on the $200,000.00 owed
by Plaintiff Wiersma since September 9, 2020, when she filed the Lis Pendens
and breached Paragraph 4 of the Settlement Agreement. (Order 04/24/2024 at p. 10.) Under Civ. Code § 3287, “the trial
court has no discretion—it must award prejudgment interest from the first day
there exists both a breach and a liquidated claim.” (Watson Bowman Acme
Corp. v. RGW Construction, Inc. (2016) 2 Cal.App.5th 279, 293.)
Defendants further contend
that Plaintiff is not entitled to prejudgment interest because Plaintiff
Wiersma disputed the deductions Defendant Lagniappe could apply to the sale
price, the amount was not certain of capable of being made certain. Thus,
Plaintiff is not entitled to prejudgment interest. “[T]he certainty requirement
promotes equity because liability for prejudgment interest occurs only when the
defendant knows or can calculate the amount owed and does not pay.” (Watson
Bowman, supra, 2 Cal.App.5th at p. 293.)
The court further finds
that Defendants are entitled to 10% interest per annum pursuant to Civ. Code § 3289(b).
Conclusion
Defense Counsel Slavkin
is awarded $45,080.00 in attorney’s fees. Defense firm is Valle Makoff LLP is awarded $373,143.23 in
attorneys fees. The court declines to award costs until a memorandum of costs
is filed by Defendants. Defendant Logan is entitled to prejudgment interest on
the $200,000.00 in liquidated damages since April 16, 2020 at 10% per annum.
Defendant Lagniappe is entitled to prejudgment interest on the $200,000.00 in
liquidated damages since September 9, 2020 at 10% per annum.
Plaintiff Wiersma’s
request for attorney’s fees is denied. Plaintiff’s award of $1,040,229.11 as
against Lagniappe will be reduced by Defendants’ attorney fee request and in
addition to the $200,000.00 due in
liquidated damages plus prejudgment interest owed separately to both Defendants.