Judge Joel R Wohlfeil, Case 37-2021-00021625-CU-BT-CTL 2024-03-29 Tentative Ruling

Judge: Joel R Wohlfeil, Case: 37-2021-00021625-CU-BT-CTL, Date: 2024-03-29 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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HALL OF JUSTICE

TENTATIVE RULINGS - March 28, 2024

03/29/2024 09:00:00 AM C-73 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Joel R. Wohlfeil

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Civil - Unlimited Business Tort Motion Hearing (Civil) 37-2021-00021625-CU-BT-CTL SILLMAN VS REYNOLDS [IMAGED] CAUSAL DOCUMENT/DATE FILED: Motion for Attorney Fees, 02/05/2024

1. The Motion (ROA # 1181) of Defendant EVELYN STEUERMANN ('Defendant') for an order for reasonable attorney's fees as the prevailing party on the cause of action for breach of Penal Code Section 502 against Plaintiff STEVEN J. SILLMAN ('Plaintiff'), is DENIED.

Plaintiff's evidentiary objections (ROA # 1189) are OVERRULED.

Plaintiff's Request (ROA # 1190) for judicial notice is GRANTED.

The Court has reviewed the federal District Court order in Physician's Surrogacy, Inc. v. German (S. D.

Cal. 2018) 311 F. Supp. 3d 1190.

The Court finds that the following analysis in this order is persuasive and will be followed: 'Originally, section 502(e)(2) read: 'In any action brought pursuant to this subdivision the court may award reasonable attorney's fees to a prevailing party.' See 1987 Cal. Legis. Serv. Ch. 1499 (S.B. 255) (West). In 2000, this section was amended to delete the words 'to a prevailing party.' See 2000 Cal. Legis. Servs. Ch. 635 (A.B. 2727) (West). At least three district courts have concluded that deletion of the words 'to a prevailing party' indicates that the California Legislature intended that attorney's fees no longer be available to all prevailing parties, but intended to limit attorney's fee awards to prevailing plaintiffs. California Bill Analysis, A.B. 2727 Sen., 08/08/2000 ('[E]xisting law allows the award of attorney's fees to prevailing parties. In response to concerns that this language might chill desired civil enforcement under the proposed new civil cause of action, this provision is proposed for repeal.'); see also Swearingen v. HAAS Automation, Inc., No. 09cv473-BTM (BLM), 2010 WL 1495204, at *2 (S.D.

Cal. Apr. 14, 2010) ('[A]n examination of the history of § 502 reveals that it was the intention of the California legislature to allow only prevailing plaintiffs to recover attorney's fees.'); Facebook, Inc. v. Power Ventures, Inc., No. 08-CV-05780-LHK, 2017 WL 3394754, at *6 (N.D. Cal. Aug. 8, 2017); OptiStreams, Inc. v. Gahan, No. CV-F-05-0117 REC SMS, 2006 WL 829113, at *10 (E.D. Cal. Mar. 27, 2006). However, an unpublished California Court of Appeal decision found that the plain text of the statute indicates that 'any party is eligible for fees under section 502.' U.S. Source LLC v. Chelliah, No.

G049481, 2014 WL 6977597, at *4 (Cal. Ct. App. Dec. 10, 2014). There, the California Court of Appeal concluded that '[t]he [California] Legislature might not have wanted to chill reasonable section 502 claims, but it wasn't willing to insulate frivolous or abusive section 502 claims either' and, therefore, the decision to award fees remains within the discretion of the trial court. Id. at *2, 7.

If recovery of attorney's fees is limited to prevailing plaintiffs under California Penal Code § 502(e), Calendar No.: Event ID: TENTATIVE RULINGS

3083722 CASE NUMBER: CASE TITLE: SILLMAN VS REYNOLDS [IMAGED] 37-2021-00021625-CU-BT-CTL Defendants are not permitted to recover their attorneys' fees as Defendants ... If the decision to award fees remains within the trial court's discretion, the Court finds it would be unreasonable to award fees because the Court did not determine that Plaintiff's section 502 claim was either frivolous or abusive ....

Accordingly, the Court declines to award Defendants attorneys' fees under section 502(e).' Id. at 1195 (some citations omitted).

Defendant is not entitled to an award of statutory attorney fees as a prevailing party. Further, the Court finds that Plaintiff's claim against this Defendant was not frivolous or abusive.

_____ 2. The Motion (ROA # 1198) of Plaintiff STEVEN SILLMAN ('Plaintiff') for an order for attorney's fees and costs against Defendants Dixie Reynolds and Atlas Storage, LLC ('Defendants'), is GRANTED IN PART and DENIED IN PART.

As discussed below, attorney fees are awarded in the reasonable amount of $93,808.00, and ordinary costs are not awarded.

Plaintiff's Request (ROA # 1202) for judicial notice is GRANTED.

Ordinary costs can only be obtained after following the procedure outlined within California Rules of Court. See Code Civ. Proc. 1034(a) ('Prejudgment costs allowable under this chapter shall be claimed and contested in accordance with rules adopted by the Judicial Council.').

'A prevailing party who claims costs must serve and file a memorandum of costs within 15 days after the date of service of the notice of entry of judgment or dismissal by the clerk ... or the date of service of written notice of entry of judgment or dismissal, or within 180 days after entry of judgment, whichever is first.' California Rules of Court, Rule 3.1700(a).

Thus, these costs cannot be awarded via this Motion.

Plaintiff lodged what appears to be an original one page 'Memorandum of Costs (Summary)' as the last page of 'Exhibit '3.'' However, a lodged document is not a filed document. Thus, the ordinary costs can also not be awarded through the memorandum of cost procedure set forth within the applicable Rules of Court. Given this ruling, the Court does not address the substantive propriety or amount of the claimed costs.

Regarding the award for attorney fees, the claim pursuant to Code of Civil Procedure section 1021.5 is not persuasive. Plaintiff's action does not satisfy the elements of section 1021.5. This action is not a matter that 'resulted in the enforcement of an important right affecting the public interest.' Code Civ.

Proc. 1021.5.

On the other hand, attorney fees could be awarded pursuant to Penal Code section 502(e): '... [T]he owner or lessee of the computer, computer system, computer network, computer program, or data who suffers damage or loss by reason of a violation of any of the provisions of subdivision (c) may bring a civil action against the violator for compensatory damages and injunctive relief or other equitable relief ....' Id. at (e)(1).

'In any action brought pursuant to this subdivision the court may award reasonable attorney's fees.' Id. at (e)(2).

Although fees are not reduced when Plaintiff prevails on only one of several factually related and closely Calendar No.: Event ID: TENTATIVE RULINGS

3083722 CASE NUMBER: CASE TITLE: SILLMAN VS REYNOLDS [IMAGED] 37-2021-00021625-CU-BT-CTL intertwined claims, a reduced fee award is appropriate when a claimant achieves only limited success.

Chavez v. City of Los Angeles (2010) 47 Cal. 4th 970, 989.

This opinion continues: 'Whether plaintiff was entitled to an award of attorney fees for time spent litigating the single successful claim requires consideration of another established principle governing attorney fee awards: '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; accord, Ketchum v. Moses (2001) 24 Cal.4th 1122, 1137.) Here, the trial court reasonably could and presumably did conclude that plaintiff's attorney fee request in the amount of $870,935.50 for 1,851.43 attorney hours was grossly inflated when considered in light of the single claim on which plaintiff succeeded, the amount of damages awarded on that claim, and the amount of time an attorney might reasonably expect to spend in litigating such a claim. This fact alone was sufficient, in the trial court's discretion, to justify denying attorney fees altogether.' Id. at 990–991.

The Court finds that the declaration of attorney Lake establishes that the $395.00 hourly rate is reasonable. A paralegal hourly rate of $125.00 is also reasonable.

However, the total attorney fees claimed is unreasonable. Most of the hours billed, as listed within 'Exhibit '3,'' pertain to litigation of the overall case, and are not specific to only the section 502 claim.

This includes drafting pleadings, propounding and responding to discovery, addressing and resolving discovery disputes, conferring with the client, corresponding with opposing counsel, etc.

In addition, it is this Court's independent recollection that the single claim for violation of Penal Code section 502 was less substantial, less complex and did not consume nearly as much time compared to the overarching claim concerning ownership of the companies.

Given both factors discussed above, the Court finds Plaintiff is entitled to an award computed at twenty-five (25) percent of the claimed amount. This is a reasonable apportionment and allocation for the time spent litigating the section 502 claim. Therefore, attorney fees are awarded in the total amount of $93,808.00.

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3083722