Superior Court of California

County of Los Angeles

North Central District

Department B

MICHAEL LAWRENCE KLINE,

Plaintiff,

MICHAEL DIBACCO,

Defendant.

Case No.: EC069344

Related to: 19BBCV00258

Hearing Date: May 31, 2024

[TENTATIVE] order RE:

motion for award of attorney’s fees and costs

BACKGROUND

A. Allegations of the Operative Complaint

Plaintiff Michael Lawrence Kline (“Plaintiff”) and Defendant Michael Dibacco (“Defendant”) each own 50% ownership of Two Michaels LLC and MRRS Co. LLC. Two Michaels LLC owns and operates 2 businesses located at 10057 Riverside Drive in Toluca Lake, consisting of a lounge and restaurant in the back of the property called “The Red Door”, and a full restaurant in the front called “Riverside.” Plaintiff is the head chef and kitchen manager of the businesses, while Defendant is the bar manager, maintains the corporate records, and manages finances. Plaintiff alleges that Defendant mishandled and misappropriated company funds, misrepresented and concealed banking and credit card records, and filed fraudulent tax returns.

Plaintiff filed the verified complaint on September 7, 2018. That same day, Plaintiff filed the verified amended complaint. Thereafter, on December 28, 2018, Plaintiff filed a Second Amended Verified Complaint. On June 24, 2022, Plaintiff filed the Third Amended Verified Complaint (“TAC”), which alleges causes of action for: (1) breach of contract; (2) breach of fiduciary duty; (3) breach of implied covenant of good faith and fair dealing; (4) fraud/intentional misrepresentation and concealment; and (5) injunctive relief.

B. Motion on Calendar

On March 22, 2024, Plaintiff Michael Lawrence Kline filed a motion for an award of attorney’s fees and costs.

The Court is not in receipt of an opposition brief.

DISCUSSION

Plaintiff moves for attorney’s fees and costs in the amount of $106,563.00 against Defendant Michael DiBacco following entry of the Court’s Order re: Contempt Hearing re: Michael DiBacco.

On February 20, 2024, the Court held a Contempt Hearing re: Michael DiBacco. The Court found that DiBacco was guilty of defying the injunction by selling the Asian Screen (Count 1) and placing items in storage (Count 2). The Court found that DiBacco had notice of the September 6, 2022 Preliminary Injunction Order, that he had the ability to comply with the order, and he failed to comply with the order, and that his failure to comply was willful. The Court ordered DiBacco to pay $1,000 for each count of contempt he was found guilty of. The Court also allowed Plaintiff to request attorney’s fees by a formal motion.

A. Entitlement to Attorney’s Fees

Plaintiff moves for attorney’s fees pursuant to CCP § 1218.

CCP § 1218(a) states:

(a) Upon the answer and evidence taken, the court or judge shall determine whether the person proceeded against is guilty of the contempt charged, and if it be adjudged that the person is guilty of the contempt, a fine may be imposed on the person not exceeding one thousand dollars ($1,000), payable to the court, or the person may be imprisoned not exceeding five days, or both. In addition, a person who is subject to a court order as a party to the action, or any agent of this person, who is adjudged guilty of contempt for violating that court order may be ordered to pay to the party initiating the contempt proceeding the reasonable attorney's fees and costs incurred by this party in connection with the contempt proceeding.

(CCP § 1218(a) [emphasis added].)

Section 1218 provides a basis for attorney’s fees in this action. As discussed above, at the contempt proceeding, the Court found DiBacco guilty of two counts of contempt and gave leave for Plaintiff to file a motion for attorney’s fees in connection with the contempt proceeding. As such, Plaintiff is entitled to fees pursuant to CCP § 1218(a).

B. Reasonableness of Attorney’s Fees

Plaintiff seeks $106,563.00 in attorney’s fees and costs against DiBacco.

In support of the motion, Plaintiff provides the relevant timeline of events that led up to and include the contempt hearing:

On July 11, 2022, the Court issued its first Preliminary Injunction Order.
On September 6, 2022, the Court issued its modified Preliminary Injunction Order.
On October 14, 2022, the Court issued its Order to Enforce the Preliminary Injunction.
On December 19, 2022, Plaintiff filed an ex parte application for an order shortening time to hear his ex parte application for issuance of an OSC re Civil Contempt and Request for Attorney’s Fees and Costs of the three aforementioned court orders.
On January 23, 2023, the Court granted Plaintiff’s ex parte application for issuance of an OSC re Civil Contempt and Request for Attorney’s Fees and Costs. The Court scheduled the OSC for March 17, 2023.
On December 1, 2023, the Court held its first hearing on the OSC re: Contempt.
On February 15, 2024, the Court held day one of the hearing on DiBacco’s contempt.
On February 20, 2024, the Court held day two of the contempt hearing, which is summarized above.
On March 4, 2024, the Court entered the Order re; Contempt Hearing re: Michael DiBacco finding DiBacco guilty of two counts of contempt and authorizing Plaintiff to file a motion for attorney’s fees.

In support of the motion for attorney’s fees, Plaintiff provides the declarations of counsel Joseph P. Hougnan and A. Raymond Hamrick, III.

Mr. Hougnan states that he has been one of the attorneys providing legal services to Plaintiff in connection with the contempt proceeding and has been Plaintiff’s counsel since the inception of the case in 2018. (Hougnan Decl., ¶3.) Mr. Hougnan was admitted to the California State Bar in 1996 and his customary fee in litigation matters is $500/hour. (Id., ¶¶4-5.) He states that prior to the contempt hearing, he agreed to accept a reduced rate[1] from Plaintiff, but his typical rate is well within or below the range of rates typically charged for legal services, such that he believes an award of his full typical $500/hour rate is appropriate. (Id., ¶5.) Mr. Hougnan provides a copy of the time records, and he states that the time billed was reasonably and necessarily incurred. (Id., ¶¶6, 8, Ex. A.) He states that the time sought is accurate and reduced to include only the hours spent in connection with DiBacco’s contempt of the Court Orders. (Id., ¶7.) He states that he billed 79.5 hours from December 2022 when he began drafting Plaintiff’s Ex Parte Application for Issuance of OSC for Civil Contempt and Request for Attorney’s Fees and Costs, through the hearing held on February 15, 2022 where he appeared as a witness. (Id.) Total, Mr. Hougnan seeks $41,250.00, which includes $39,750 in attorney’s fees for his services (79.5 hours x $500), plus $1,500 for the approximate amount of time he will spend in connection with the hearing on this matter. (Id., ¶¶9-11.)

Mr. Hamrick states that he served as lead counsel in the contempt proceedings after associating in as counsel for Plaintiff. (Hamrick Decl., ¶1.) He provides a copy of the invoices for his services. (Id., ¶3, Ex. A.) He states that he was involved in three hearings on DiBacco’s OSC re contempt and supervised work for all personnel whose work reimbursement is sought by this motion. (Id., ¶4.) He states that Plaintiff was billed $600/hour for partner time and $500/hour for associate time. (Id., ¶5.) Mr. Hamrick has over 40 years of experience and believes his rate is reasonable and customary. (Id., ¶6.) Mr. Hamrick describes the work performed associated with the contempt proceeding. (Id., ¶¶7-13.) He states that he incurred $13,920.00 in attorney’s fees (23.2 hours x $600/hour). (Id., ¶14.) He states that associate Shian V. Brisbois (admitted 2011) incurred $39,450 in fees (78.9 hours x $500/hour) and senior associate Kenneth Kotarski (admitted 1981) incurred $350 (0.7 hour x $500/hour). (Id., ¶¶15-18.) His firm billed $53,720 for the work in connection with the contempt matters and he estimates an additional $5,400 in connection with the motion (opposition and reply) and hearing. (Id., ¶¶19-20.) He states that his firm also advanced costs on behalf of Plaintiff in the amount of $473.56 for filing, court costs, and/or service fees, as well as $5,700 in court report fees related to the contempt hearings. (Id., ¶¶21-22, Ex. B [court reporter invoices].) Total, Mr. Hamrick seeks $65,313.00 ($53,720 in attorney’s fees + $5,400 in anticipated fees, plus $6,173 in costs). (Id., ¶23.)

The Court has reviewed the billing records of counsel and will make the following adjustments to the time billed.

Joseph P. Hougnan: The Court will not allow Mr. Hougnan’s time. Mr. Hougnan was lead counsel, but also a witness. His decision to subcontract the work may have been a wise one given his personal involvement in the underlying facts, but it necessitated a complete duplication of effort by not one, but two experienced attorneys, thus inflating the amount due for attorneys’ fees.
A. Raymond Hamrick, III: The Court will not allow Mr. Hamrick’s time. Mr. Hamrick is an excellent attorney and did a good job of handling the matter. Nevertheless, his involvement in the matter was not reasonable or necessary given the amount at issue in the case and the small value of the two items of personal property at issue. The matter was already being handled by one experienced attorney with more than 10 years of experience who presumably was capable of handling this simple trial and the hearings leading up to it.
Shian V. Brisbois: The Court will allow Ms. Brisbois time. If she is billing clients at the rate of $500/hour she is presumptively able to handle a simple trial like this one by herself. She seemed completely familiar with the issues and documentation such that involving an experienced attorney like Mr. Hamrick was wholly unnecessary overkill. The Court will award the requested amount of $39,450 for Ms. Brisbois’ fees.
Kenneth Kotarski: The only time billed by Mr. Kotarski is 0.7 hour on December 12, 2023 to review and evaluate the scope of work for Two Michaels LLC on The Red Door – Conditional Use Permit matter in support of the opposition to DiBacco’s motion to disqualify. The Court will disallow the time billed by Mr. Kotarski as it does not appear necessary to have involved him in a matter already being handled by Ms. Brisbois.
Hamrick & Evans, LLP’s anticipated fees: The Court will reduce the anticipated fees for the motion (as there is no opposition brief) and the hearing to 1 hour, or $500.
Costs: The Court will allow the recovery of costs in the amount of $473.56 for filing, court costs, and/or service fees, as well as the $5,700 court reporter fees incurred by Hamrick & Evans, LLP. This totals $6,173 in costs.
Total: Total, the Court will award $39,950.00 in attorney’s fees ($0 for Mr. Hougnan’s fees + $0 for Mr. Hamrick’s fees + $39,950 for Ms. Brisbois’s fees + $0 for Mr. Kotarski’s fees + $500 in anticipated fees for Hamrick & Evans, LLP) and $6,173.00 in costs.

Accordingly, the motion for attorney’s fees and costs is granted in the amounts of $39,950.00 in attorney’s fees and $6,173.00 in costs.

CONCLUSION AND ORDER

Plaintiff Michael Lawrence Kline’s motion for attorney’s fees and costs is granted in the amounts of $39,950.00 in attorney’s fees and $6,173.00 in costs.

Plaintiff shall provide notice of this order.

DATED: May 31, 2024 ___________________________

John Kralik

Judge of the Superior Court

[1] This reduced rate is not disclosed in his declaration.