Judge Kerry Bensinger, Case Number: BC665330, Date: 2024-01-22 Tentative Ruling

MOVING PARTY: Nonparties Redondo Beach Waterfront, LLC; Fred Bruning; and Jean Paul Wardy

This case arises from a 2017 Redondo Beach municipal election.[1] In the election political action committee Rescue Our Waterfront P.A.C. (“ROW”) and political candidates Bill Brand (“Brand”) and Nils Nehrenheim (“Nehrenheim”), successfully campaigned for a ballot measure. Proponents of the ballot measure opposed a large redevelopment of the Redondo Beach municipal waterfront. Opponents of the measure supported the waterfront redevelopment. After the vote, two citizens, Plaintiffs Arnette Travis (“Travis”) and Chris Voisey (“Voisey”) sued ROW, Brand, Nehrenheim, ROW officer Wayne Craig (“Craig”), Bill Brand for Mayor 2017 (Brand’s mayoral campaign committee) and its treasurer, Linda Moffat (“Moffat”), claiming Brand and Nehrenheim violated the Political Reform Act, Government Code (Gov. Code) section 81000 et seq., (PRA) by controlling the committee and using an improper title for itself.

After a bench trial, the trial court ruled in Defendants’ favor. The court awarded Defendant’s their attorney’s fees pursuant to Gov. Code section 91003 as the prevailing party. On April 3, 2019, the trial court entered judgment in favor of the Defendants and against the Plaintiffs. The judgment included several findings. In relevant part, the trial court found Travis and Voisey were “shills” for nonparty developer Redondo Beach Waterfront, LLC (“RBW”), and its principals Fred Bruning (“Bruning”), and Jean Paul Wardy (“Wardy”) who initiated this lawsuit against Defendants and directed and financed the prosecution of this case. Defendants submitted a proposed judgment for the court’s signature which included nonparties RBW, Bruning, and Wardy. RBW, Bruning, and Wardy of the submission. The court signed the judgment making RBW, Bruning, and Wardy liable for the fees.

RBW, Bruning, and Wardy (hereafter, the “Nonparty Developers”) appealed the judgment.[2] On appeal, the court in Travis I, 62 Cal.App.5th 240 held the judgment was void as to the Nonparty Developers because they were not parties to the action. The Nonparty Developers were awarded their costs on appeal. Plaintiffs also appealed the judgment. The court in Travis I affirmed the award of attorney fees against the Plaintiffs.

The Supreme Court granted review and reversed. In Travis II, 14 Cal.5th 411, the California High Court held that an award of fees and costs under the PRA was governed by the standard set forth in Christiansburg Garment Co. v. Equal Employment Opportunity Comm’n (1978) 434 U.S. 412 (Christiansburg). Upon remand, the Court of Appeal in Travis v. Brand (2023) 91 Cal.App.5th 996 (Travis III) applied the Christiansburg standard and reversed the award of fees against Plaintiffs. The Travis III court reaffirmed Nonparty Developers recovery of their appellate costs.

On August 23, 2023, the Nonparty Developers filed this motion for attorney fees as prevailing parties under the PRA.

On October 19, 2023, Brand, Brand for Mayor 2017, and Moffat filed an opposition. On the same day, Nehrenheim and ROW each filed a Joinder to the opposition. Nehrenheim also separately filed an opposition.^{^[3]}

Nonparty Developers seek an award of attorney fees in the sum of $164,560 against Defendants based on the following grounds: (1) they are prevailing parties under the PRA, and (2) alternatively, they are entitled to fees under Code of Civil Procedure (CCP) section 1021.5. Neither argument succeeds.

Under Gov. Code section 91003, “The court may award to a plaintiff or defendant who prevails his costs of litigation, including reasonable attorney's fees.” (Gov. Code, § 91003, subd. (a), emphasis added.) “This section applies to cases seeking injunctive relief to enjoin violations or to compel compliance with the provisions of the Political Reform Act of 1974.” (Travis I, supra, 62 Cal.App.5th at p. 276.) Here, Nonparty Developers were not parties to the action.[4]

While Nonparty Developers had to pursue their rights in the court of appeal to set aside the judgment, they were neither parties in the underlying case nor were they prevailing parties in the underlying case. Nonparty Developers argue they are prevailing parties because the trial court’s judgment joined them in this action and because they successfully voided the judgment on appeal. Nonparty Developers contend they advanced “the goals of the PRA, which is to encourage such lawsuits.” (Mot., p. 12.) Not so. Nonparty Developers’ appealed to eliminate their own liability. Nonparty Developers ignore the basis upon which the Travis I Court voided the judgment. There, the appellate court stated:

The court acted beyond its authority by issuing a judgment against nonparties to the action. The Second District, Division One, analyzed this issue in Moore v. Kaufman (2010) 189 Cal.App.4th 604, 117 Cal.Rptr.3d 196. In Moore, the court found a judgment against the plaintiff's counsel was void because that attorney was not a party to the action. (Id. at pp. 615–616, 117 Cal.Rptr.3d 196.) The opinion quoted the Witkin treatise, which says, “A judgment in favor of a person who is not a party to the action is obviously beyond the authority of the court.” (2 Witkin, Cal. Procedure (5th ed. 2008) Jurisdiction, § 315, p. 927.) The trial court in this case also acted beyond its authority by issuing judgment against the nonparties.”

In other words, the Travis I court voided the judgment because Nonparty Developers were precisely that: nonparties. Nonparty Developers argue at cross-purposes. On the one hand, they argue the judgment against them is void because they were not parties to the action. On the other hand, they argue they are entitled to attorney’s fees because they are prevailing parties. They were not parties to the PRA action and don’t fall within the scope of the statute.

With respect to advancing the goals of the PRA, Nonparty Developers conflate and confuse appealing the judgment successfully with being a prevailing party under the PRA. As discussed above, Nonparty Developers prevailed on appeal because they were not parties to the action. Moreover, at trial the court found in favor of the Defendants. As such, Defendants were the prevailing parties in Plaintiffs’ PRA action. Travis I reversed the judgment as to Nonparty Developers but upheld the judgment against Plaintiffs. Travis II reversed the court of appeal finding that the asymmetrical standard under Christiansburg applied to fee awards for prevailing defendants in a PRA action but did not disturb the trial court’s finding in favor of the Defendants on the merits.^{^[5]} Accordingly, Travis II reversed the attorney’s fees award against the Plaintiffs and remanded to allow the court of appeal to apply the Christiansburg standard. On remand, Travis III applied the Christiansburg standard and concluded Plaintiffs’ action had a factual and legal foundation. The appellate court reversed the attorney’s fee award. Nowhere in the appellate history does the Court of Appeal or the Supreme Court suggest that Plaintiffs were prevailing parties, let alone that Nonparty Developers were prevailing parties on the PRA action.

Undeterred, Nonparty Developers argue that under California law, prevailing parties are not limited to parties of record. For this proposition, Nonparty Developers rely on CCP section 1032, subdivision (a)(4), which provides:

“Prevailing party” includes the party with a net monetary recovery, a defendant in whose favor a dismissal is entered, a defendant where neither plaintiff nor defendant obtains any relief, and a defendant as against those plaintiffs who do not recover any relief against that defendant. If any party recovers other than monetary relief and in situations other than as specified, the “prevailing party” shall be as determined by the court, and under those circumstances, the court, in its discretion, may allow costs or not and, if allowed, may apportion costs between the parties on the same or adverse sides pursuant to rules adopted under Section 1034.” (Emphasis added.)

Reference to Section 1032 is to no avail because, at best, the statutory section affords Nonparty Developers costs. And the appellate court in Travis I already awarded them costs on appeal. Travis III so confirmed. Nothing more was awarded to Nonparty Developers.[6] And as described below, nothing more should be awarded.[7]

Alternatively, Nonparty Developers argue they are entitled to attorney’s fees pursuant to CCP section 1021.5 -- “the so-called private attorney general fees.” (Travis III, supra, at p. 1008.). Section 1021.5 provides, in relevant part:

“Upon motion, a court may award attorneys’ fees to a successful party against one or more opposing parties in any action which has resulted in the enforcement of an important right affecting the public interest if: (a) a significant benefit, whether pecuniary or nonpecuniary, has been conferred on the general public or a large class of persons, (b) the necessity and financial burden of private enforcement, or of enforcement by one public entity against another public entity, are such as to make the award appropriate, and (c) such fees should not in the interest of justice be paid out of the recovery, if any.” (Emphasis added.)

The court of appeal in Travis III described the elements of the private attorney general statute as follows: “A party must satisfy four elements to earn private attorney general fees. In shorthand, the elements are: (1) the party enforces an important right affecting the public interest; (2) the party confers a significant benefit to the general public or a large class of people; (3) an award is appropriate because private enforcement was necessary and financially burdensome; and (4) fees must not be paid out of a recovery. (Citations omitted.)” (Travis III, supra, at p.758.”)[8]

In Travis III, Defendants pursued a fee award. According to Defendants, they were entitled to fees because their victory enforced an important right affecting the public interest and conferred a significant benefit on the general public. Nonparty Developers advance the same argument here. The court of appeal disagreed. Whether viewed from Plaintiffs’, Defendants’, or Nonparty Developer’s side, the court of appeal’s comments apply with equal force to considerations whether fees are warranted under the private attorney general fee statute. The court of appeal had strong feelings on this point. Here are several excerpts:

· The public at large did not know and did not care about the issues the court adjudicated. Nothing in the record demonstrates even minimal public interest in these obscurities. Practically and realistically, important rights affecting the public interest were nowhere to be seen. (Citation omitted.) The claim for fees fails element one of the test. (Travis III, supra, at p. 1010.).

· The Supporters seek, unsuccessfully, to inflate the significance of this litigation by suggesting the redevelopment proposal was large and many people voted for Measure C. The lawsuit, however, did not tackle the merits of redevelopment. Nor did it challenge the election's validity. These pitches are balls, not strikes. (Ibid.)

· There has been no showing that anyone besides the parties does care, or should care, about this case. The claim for fees flunks element two of the test. (Citation omitted.) (Ibid.)

In addition, Nonparty Developers argue they are entitled to fees under the private attorney general statute because Travis I resulted in a published opinion. Nonparty Developers reach too far. Part C in Travis I is devoted to Nonparty Developers’ issue. It spans six paragraphs. It is not a novel concept that “[a] judgment in favor of a person who is not a party to the action is obviously beyond the authority of the court.” (2 Witkin, Cal. Procedure (5th ed. 2008) Jurisdiction, § 315, p. 927.)” (Travis I, supra, at p. 262.) This particular concept did not travel up to the California Supreme Court and back down to the California Court of Appeal.[9] The Christiansburg issue did. No doubt, it is unfortunate that a judgment was entered against the Nonparty Developers requiring them to untangle themselves from liability, but that misfortune does not sweep the Nonparty Developers’ issue within the ambit of the private attorney general statute.

“California follows the American rule regarding attorney's fees. Under that rule, litigants are ordinarily responsible for paying their own attorney's fees, unless a statute or agreement provides otherwise.” (Travis II, supra, 14 Cal.5th at p. 417.). Here, neither Gov. Code section 91003 nor CCP section 1021.5 authorizes an award of attorney fees to the Nonparty Developers. The “American rule” applies.

[1] These facts are adapted from the Court of Appeal’s opinion in Travis v. Brand (2021) 62 Cal.App.5th 240, 245 (Travis I), rev’d and remanded, Travis v. Brand (2023) 14 Cal.5th 411, 523 (Travis II).

[2] Throughout their papers RBW, Bruning, and Wardy refer to themselves collectively as the “Developer Parties”. They do so, no doubt, to suggest that they were parties to the action. But they were not parties. This court will refer to them in the same manner as the court of appeal – nonparties.

[3] Brand, Brand for Mayor 2017, and Moffat filed a Joinder to Nehrenheim’s opposition.

[4] Nonparty Developers could not have been plaintiffs in this action. Gov. Code section 91003, subdivision (a) permits “[a]ny person residing in the jurisdiction” to sue for injunctive relief to enjoin violations or to compel compliance with the provisions of the Political Reform Act. (Emphasis added.) As Defendants point out, the Nonparty Developers were not residents of Redondo Beach and were therefore barred from bringing this action. Nonparty Developers do not contest this point.

[5] As stated in Travis III: “[W]e conclude applying an asymmetrical standard to fee awards under the Political Reform Act is consistent with the principles outlined by our high court in Christiansburg. To reiterate, under the asymmetrical standard, a prevailing defendant “should not be awarded fees and costs unless the court finds the action was objectively without foundation when brought, or the plaintiff continued to litigate after it clearly became so.” (Williams, supra, 61 Cal.4th at p. 115, 186 Cal.Rptr.3d 826, 347 P.3d 976; accord, Christiansburg, supra, 434 U.S. at p. 421, 98 S.Ct. 694 [prevailing defendants may recover only when “the plaintiff's action was frivolous, unreasonable, or without foundation, even though not brought in subjective bad faith”].)” (Travis III, supra, 14 Cal.5th at pp. 427–28.)

[6] Nonparty Developers citation to Chaparral Greens v. City of Chula Vista (1996) 50 Cal.App.4^th 1134 (Chaparral Greens) Chaparral Greens is inapposite. Chaparral Green involved the recovery of costs, not fees.

[7] CCP section 1032 “does not purport to define the term ‘prevailing party’ for all purposes.” (Galan v. Wolfriver Holding Corp. (2000) 80 Cal.App.4th 1124, 1128.) California courts have uniformly rejected the premise that a litigant who prevails under CCP § 1032 is “ ‘necessarily the prevailing party for purposes of attorney fees[.]’ ” (Galan, at pp. 1128-1129; see also Pacific Custom Pools, Inc. v. Turner Construction Co. (2000) 79 Cal.App.4th 1254, 1271, fn. 13 [“[T]he determination of the prevailing party for the purposes of costs is not controlling as to the issue of prevailing party for the entitlement of attorney's fees.’ ”].)

[8] Nonparty Developers cite Save Our Heritage Organization v. City of San Diego (2017) 11 Cal.App.5^th 154 (SOHO) for the proposition that attorney’s fees can be awarded under section 1021.5 to non-parties. Maybe so and maybe under certain circumstances not found here. Indeed, SOHO is not helpful to Nonparty Developers’ cause because the Committee in SOHO, unlike the Nonparty Developers here, satisfied the essential elements of the private attorney general statute.

[9] Indeed, the California Supreme Court Opinion did not mention the Nonparty Developers, let alone discuss the issue relevant to the Nonparty Developers -- the appropriateness of a judgment entered against a nonparty. And ultimately the Nonparty Developers cannot overcome the Travis III Court’s opinion that no party enforced an important right affecting the public interest or conferred a significant benefit to the general public or a large class of people. Indeed, in the final analysis, Nonparty Developers pursued their appeal to untangle themselves from the improper judgment entered against them, not in pursuit of a larger public interest.