Judge Holly J. Fujie, Case Number: 20STCV34289, Date: 2023-09-27 Tentative Ruling

DEPARTMENT 56 JUDGE HOLLY J. FUJIE, LAW AND MOTION RULINGS. The court makes every effort to post tentative rulings by 5.00 pm of the court day before the hearing. The tentative ruling will not become the final ruling until the hearing [see CRC 3.1308(a)(2)], and are also available in the courtroom on the day of the hearing [see CRC 3.1308(b)]. If the parties wish to submit on the tentative ruling and avoid a court appearance, all counsel must agree and choose which counsel will give notice. That counsel must 1) call Dept 56 by 8:30 a.m. on the day of the hearing (213/633-0656) and state that all parties will submit on the tentative ruling, and 2) serve notice of the ruling on all parties. If any party declines to submit on the tentative ruling, then no telephone call is necessary and all parties should appear at the hearing in person or by Court Call. Court reporters are not provided, and parties who want a record of motions and other proceedings must hire a privately retained certified court reporter.

MOVING PARTIES: Defendants and Cross-Complainants MLA Money Purchase Pension Plan (“MPPP”) and MLA Defined Benefit Pension Plan (“DBPP”) (collectively “MLA Defendants”)

The Court has considered the moving papers. No opposition papers were filed. Any opposition papers were required to have been filed and served at least nine court days prior to the hearing pursuant to California Code of Civil Procedure, Section 1005(b).

On September 9, 2020, Plaintiffs Bruce E. Fishman, M.D., Bruce Eliot Fishman, M.D., F.I.C.S., Inc., and Family Urgent Care & Industrial Medical Clinic, Inc. (collectively “Plaintiffs”) filed a Complaint against Defendants Patrick Nazemi, Med-Legal Associates, Inc. (“MLA”), Med-Legal Associates, LLC, MPPP, DBPP, US Risk Insurance Company, Inc., So Cal Practice Management, Inc. (a California corporation), So Cal Practice Management, Inc. (a Montana corporation), GLC Operations, Inc., GLCI, Inc., Medlink Alliance, Inc. (collectively “Defendants”), and DOES 1 through 50, inclusive, alleging causes of action for: (1) intentional fraudulent transfer; (2) fraudulent transfer; (3) transfer resulting in debtor’s insolvency; (4) common law fraudulent transfer; (5) aiding and abetting fraudulent transfer; (6) declaratory relief; and (7) unjust enrichment.

On May 31, 2023, DBPP filed a Cross-Complaint seeking declaratory relief as to the fraudulent transfers alleged in the Complaint. Also, on May 31, 2023, MLA Defendants filed a motion for summary judgment as to the Complaint and the Cross-Complaint on the grounds that there are no triable issues of material fact on the claims asserted in the Complaint and Cross-Complaint.

On September 27, 2023, after hearing oral argument, the Court granted the motion for summary judgment filed by MLA Defendants. (09/27/23 Minute Order.)

On November 2, 2023, the Court entered judgment in favor of MLA Defendants and against Plaintiffs as to the Complaint and entered judgment in favor of DBPP as to the Cross-Complaint. The judgment provides that the right of MLA Defendants to attorney’s fees will be determined by a subsequent motion for attorney’s fees.

On December 28, 2023, MLA Defendants filed and served the instant unopposed Motion for Attorney’s Fees (the “Motion”). Pursuant to the Motion, MLA Defendants move for an order for attorney’s fees in the amount of $68,835.00 times a multiplier of not less than 1.5.

On February 2, 2024, Plaintiffs filed notice of appeal indicating that they are appealing all judgments in this case including any costs and/or attorneys’ fees orders issued in the future. (02/02/24 Notice of Appeal.) “Although a prevailing party . . . may not be the prevailing party after an appeal, it has been held that a motion for attorney fees is not premature despite the filing of a notice of appeal.” (Bankes v. Lucas (1992) 9 Cal.App.4th 365, 368.) Thus, despite Plaintiffs’ pending appeal, the Court can rule on the Motion.

In general, a prevailing party may recover attorney’s fees only when a statute or agreement of the parties provides for fee shifting. (Kirby v. Immoos Fire Protection, Inc. (2012) 53 Cal.4th 1244, 1248.) It is well established that the determination of what constitutes reasonable attorney fees is committed to the discretion of the trial court, whose decision cannot be reversed in the absence of an abuse of discretion. (Melnyk v. Robledo (1976) 64 Cal.App.3d 618, 623.) “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 reasonable hourly rate is that prevailing in the community for similar work. (Margolin v. Regional Planning Com. (1982) 134 Cal.App.3d 999, 1004.)

A computation of time spent on a case and the reasonable value of that time is fundamental to a determination of an appropriate attorneys’ fee award. (Margolin v. Regional Planning Com., supra, 134 Cal.App.3d 999, 1004.) The 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. (Serrano v. Priest (1977) 20 Cal.3d 25, 49.) Such an approach anchors the trial court’s analysis to an objective determination of the value of the attorney’s services, ensuring that the amount awarded is not arbitrary. (Id. at p. 48, fn. 23.) 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.) The burden is on the party seeking attorney fees to prove that the fees it seeks are reasonable. (Gorman v. Tassajara Development Corp. (2009) 178 Cal.App.4th 44, 98.) An award of attorney fees may be based on counsel’s declarations, without production of detailed time records. (Raining Data Corp. v. Barrenechea (2009) 175 Cal.App.4th 1363, 1365.)

Unless authorized by either statute or agreement, attorney’s fees ordinarily are not recoverable as costs. (Reynolds Metals Co. v. Alperson (1979) 25 Cal.3d 124, 127.) California Civil Code, Section 1717(a) provides the following: 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. (Civ. Code § 1717(a).) Civ. Code § 1717 was enacted to establish mutuality of remedy where a contractual provision makes recovery of attorney’s fees available for only one party. (Reynolds Metals Co. v. Alperson, supra, 25 Cal.3d 124, 128.) If a contractual attorney fee provision is phrased broadly enough, it may support an award of attorney fees to the prevailing party in an action alleging both contract and tort claims. (Santisas v. Goodin (1998) 17 Cal.4th 599, 608.)

MLA Defendants contend that they are entitled to attorney’s fees since they prevailed on Plaintiffs’ attempt to hold them liable as non-signatories to an agreement for attorney’s fees based on MLA Defendants being alter egos/single business enterprise. In the Complaint, Plaintiffs allege that MLA Defendants were alter egos and/or single enterprise of Defendant MLA. (Complaint, ¶¶ 17, 89, 90.) The Complaint alleges that Plaintiff Fishman is a board-certified occupational medicine physician with additional training and expertise in orthopedic surgery and urgent care medicine who was previously under contract with MLA pursuant to a Resource Sharing Agreement. (Complaint, ¶ 27.) Plaintiffs allege that such contract contained a prevailing party attorneys’ fees and expense clause, which is applicable to the instant action and Plaintiff Fishman is entitled to attorneys’ fees and expenses in this case. (Complaint, ¶ 27.)

The Court finds that MLA Defendants are entitled to attorney’s fees as the prevailing parties. MLA Defendants prevailed on their motion for summary judgment and judgment was entered in favor of MLA Defendants and against Plaintiffs. Attorney’s fees are proper because “[h]ad plaintiff[s] prevailed on [their] cause of action claiming defendants were in fact the alter egos” of one another then “defendants would have been liable for attorney’s fees.” (Reynolds Metals Co. v. Alperson, supra, 25 Cal.3d 124, 129.) The Management Services Agreement (the “Agreement”) entered into between MLA and Plaintiffs contains a provision stating the following:

“Should either party institute any action or proceeding, including without limitation arbitration, in connection with, or relating to or arising out of this Agreement, the prevailing party shall be entitled to receive from the other party all costs and expenses, including reasonable attorney’s fees incurred in connection with such action or proceeding.”

Here, although MLA Defendants are not parties to the agreement, the language therein allows for attorney’s fees to be awarded to MLA Defendants. Had Plaintiffs prevailed on their claims, they would have been entitled to an award of attorney’s fees against MLA Defendants due to the alter ego allegations. Thus, under Reynolds Metals Co. v. Alperson, supra, 25 Cal.3d 124, 129, MLA Defendants are entitled to attorney’s fees. Moreover, given that the Motion is unopposed, the Court finds that Plaintiffs have conceded to the arguments concerning the entitlement of MLA Defendants to attorney’s fees. Contentions are waived when a party fails to support them with reasoned argument and citations to authority. (Moulton Niguel Water Dist. v. Colombo (2003) 111 Cal.App.4th 1210, 1215.)

MLA Defendants request attorney’s fees in the amount of $68,835.00 and a multiplier of not less than 1.5. As will be explained below, MLA Defendants have not established the reasonableness of their requested attorney’s fees.

In support of the Motion, counsel for MLA Defendants, Ronald D. Tym (“Tym”) provides a declaration. Tym states that he is a 1979 graduate of Stanford Law School and has been practicing continuously since that time. (Tym Decl., ¶ 3.) Tym has billed MLA Defendants at the rate of $650.00 per hour for work in this case. (Tym Decl., ¶ 4.) Tym spent 105.9 hours working on this case. (Tym Decl., ¶ 5.) Tym states that the product of the hours worked times his hourly rate is $68,835.00. (Tym Decl., ¶ 6.)

The Court finds that MLA Defendants have not substantiated their requested amount of attorney’s fees. MLA Defendants did not submit any billing records or invoices in support of the Motion. The declaration of counsel in support of the Motion does not attest to either the reasonableness or necessity of the claimed attorney’s fees. Based on the record before the Court, the Court cannot ascertain the reasonableness of MLA Defendants’ claimed fees. Given that MLA Defendants seek a substantial amount of attorney’s fees, the Court would like to review counsel’s billing entries prior to ruling on the Motion. Although the Motion is unopposed, the Court wants to ensure that the fees requested are reasonable.

Therefore, the Court CONTINUES the hearing on the Motion to April 29, 2024 at 8:30 a.m.. The Court ORDERS counsel for MLA Defendants, Ronald D. Tym, to file a supplemental declaration setting forth the reasonableness of the claimed attorney’s fees and to provide the Court will billing records for the work done in this case. The Court orders that the supplemental declaration be filed and served by the close of business on Friday, April 19, 2024.

Parties who intend to submit on this tentative must send an email to the Court at SMC_DEPT56@lacourt.org as directed by the instructions provided on the court website at www.lacourt.org. If the department does not receive an email and there are no appearances at the hearing, the motion will be placed off calendar.

Hon. Holly J. Fujie

Judge of the Superior Court