Judge Mark E. Windham, Case 21STLC02106 2023-02-05 Tentative Ruling

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Creditors Adjustment Bureau, Inc. v. LB Taphouse, Inc., et al.
MOTION FOR ATTORNEY’S FEES

Plaintiff Creditor’s Adjustment Bureau, Inc.’s Motion for Attorney’s Fees and Costs is GRANTED IN THE AMOUNT OF $17,580.00 ATTORNEY’S FEES AND $2,258.34 COSTS.

Plaintiff Creditors Adjustment Bureau (“Plaintiff”) filed the instant action against Defendants LB Taphouse, Inc. (“Defendant LB Taphouse”) and Brent Scheiber (“Scheiber”) on March 12, 2021. Following Defendant LB Taphouse and Scheiber’s failure to respond, the Court entered their defaults on June 15, 2021. On October 19, 2021, Plaintiff voluntarily dismissed Scheiber. Thereafter, the Court entered judgment against Defendant LB Taphouse on November 10, 2021. On March 17, 2022, the Court granted Defendant LB Taphouse’s Motion to Vacate Default and Default Judgment. (Minute Order, 03/17/22.) Defendant LB Taphouse filed the instant Motion for Summary Judgment on July 27, 2022.

On August 31, 2022, Plaintiff filed a copy of an Offer to Compromise Pursuant to Code of Civil Procedure section 998, which was signed by both parties. (998 Offer, filed 08/31/22.) A proposed judgment on the 998 Offer was filed the same date. On September 13, 2022, the Court denied Defendant LB Taphouse’s ex parte application to vacate the judgment. (Minute Order, 09/13/22.) Judgment was entered pursuant to the 998 Offer on September 21, 2022. Thereafter, the Court denied Defendant LB Taphouse’s noticed Motion to Vacate Judgment on October 26, 2022.

On September 22, 2022, Plaintiff filed the instant Motion for Attorney’s Fees and Costs. Defendant LB Taphouse filed an opposition on December 20, 2022 and Plaintiff replied on December 23, 2022. The Motion initially came for hearing on January 4, 2023 and was continued to allow for further briefing. Defendant filed another opposition on January 19, 2023 and Plaintiff filed another reply on January 27, 2023.

Plaintiff moves for attorney’s fees pursuant to the parties’ settlement agreement under Code of Civil Procedure section 998. Attorney’s fees under a 998 offer may be awarded pursuant to the contractual grounds for such an award. (Linton v. County of Contra Costa (2019) 31 Cal.App.5th 628, 635 [citing Code Civ. Proc., § 1033.5, subd. (a)(10)].) The fees awarded are based on the parties’ agreement, which is determined by general contract principals. (Id. at 636.) First, the Court looks at the plain meaning of the agreement’s language. (Ibid.) The Court must read the contract as a whole to determine the parties’ agreement. (See ACL Technologies, Inc. v. Northbrook Property & Casualty Ins. Co. (1993) 17 Cal.App.4th 1773, 1785 [“The whole of a contract is to be taken together, so as to give effect to every part, if reasonably practicable, each clause helping to interpret the other”].) Here, the parties’ 998 offer does not include any provision regarding attorney’s fees and costs. (Offer to Compromise, filed 08/31/22, pp. 1-2.) When a 998 offer is silent with respect to attorney’s fees and costs, a party may still move for such an award. (On-Line Power, Inc. v. Mazur (2007) 149 Cal.App.4th 1079, 1084 [citing Ritzenthaler v. Fireside Thrift Co. (2001) 93 Cal.App.4th 986, 990-991].)

A motion for attorney’s fees must be filed and served with the time for filing a notice of appeal under Cal. Rules of Court Rule 8.822. (Cal. Rules of Court Rule 3.1702(a).) Cal. Rules of Court Rule 8.822 states that an attorneys’ fees motion must be filed within either (1) 30 days after the trial court clerk served the party filing the motion with notice of entry of judgment; or (2) 90 days after entry of judgment. (Cal. Rules of Court 8.822(1).) The Motion for Attorney’s Fees and Costs was timely filed the day after judgment was entered.

A prevailing party in entitled to recover costs when authorized by contract, statute, or law. (Code Civ. Proc., § 1032, subd. (a)(4).) It is undisputed that Plaintiff is the prevailing party in this action, as the party with the net monetary recovery. (See Code Civ. Proc., § 1032, subd. (a)(4).) Accordingly, Plaintiff is entitled to recover its costs, which can include attorney’s fees if provided for by contract, statute, or law. (Code Civ. Proc., § 1033.5, subd. (a)(10).) Plaintiff points out that a prevailing party on a contract can recover attorney’s fees and costs under Civil Code section 1717 where a contract so provides. The parties’ contractual agreement—the Application for Credit—specifically includes an attorney’s fees provision. (Motion, Freed Decl., Exh. 1.) Therefore, Plaintiff is entitled to an award of its reasonable attorney’s fees.

Defendant LB Taphouse’s contention that there is no prevailing party simply reiterates its arguments to vacate the judgment, which the Court already considered and denied on October 26, 2022.

Plaintiff requests attorney’s fees of $43,310.00. (Motion, p. 9:3-4; Reply, p. 9:19-21.) Plaintiff’s counsel billed for the work of one attorney at $600.00 per hour, five attorneys at $500.00 per hour, and one attorney at $400.00 per hour. (Motion, Freed Decl., ¶¶4-6.) The number of years of experience of these attorneys, however, is not the only consideration for a reasonable hourly rate.

“In making its calculation [of a reasonable hourly rate], the court may rely on its own knowledge and familiarity with the legal market, as well as the experience, skill, and reputation of the attorney requesting fees [citation], the difficulty or complexity of the litigation to which that skill was applied [citations], and affidavits from other attorneys regarding prevailing fees in the community and rate determinations in other cases.” (569 East, supra, 6 Cal.App.5th at p. 437, 212 Cal.Rptr.3d 304; see Mountjoy, supra, 245 Cal.App.4th at p. 272, 199 Cal.Rptr.3d 495 [“ ‘ “a reasonable hourly rate is the product of a multiplicity of factors .... [including] the level of skill necessary, time limitations, the amount to be obtained in the litigation, the attorney's reputation, and the undesirability of the case” ’ ”].)

(Morris v. Hyundai Motor America (2019) 41 Cal.App.5th 24, 41.) Here, the simplicity of the case and the limited statutory damages to be obtained do not support an hourly rate of more than $300.00 per hour. This action involved routine causes of action for common counts and breach of contract and sought damages of $13,121.28. Nor has Plaintiff otherwise shown what factors support a higher hourly rate.

Regarding the number of hours billed, not all the time was due to defense counsel’s purportedly abusive conduct, as Plaintiff contends. A significant amount of time went towards an improper request for entry of default and default judgment, which the Court vacated upon Defendant LB Taphouse’s motion. (Motion, Freed Decl., Exh. 5, p. 1.) Plaintiff’s counsel also unnecessarily billed three hours to review a second ex parte application by Defendant LB Taphouse that was identical to one submitted three days earlier but rejected for filing. (Id. at Exh. 5, p. 2.) This was after already spending 5.3 hours to draft an opposition to the original ex parte application. (Ibid.) The Court does acknowledge that Defendant LB Taphouse filed several, unsuccessful ex parte applications and an unsuccessful Motion to Vacate Judgment, which required Plaintiff to file oppositions. Defendant LB Taphouse’s conduct also apparently delayed discovery such that Plaintiff was required to bring its own ex parte application. (Id. at Exh. 5, pp. 2-3.) The fees billed after this Motion were filed all appear reasonable and compensable. In particular, the reply brief has to address the instant Motion for Attorney’s Fees and provide a separate opposition to Defendant’s eleventh-hour Motion to Compel Arbitration, which has now been taken off calendar. Based on the foregoing, the Court finds the number of hours billed up to the filing of this Motion should be reduced by 30 percent to account for the above. The additional 15.6 hours billed afterwards are awarded in full. Therefore, Plaintiff is awarded attorney’s fees based on 58.6 hours of work billed at $300.00 in the amount of $17,580.00.

Finally, the costs are awarded to Plaintiff per the unopposed Memorandum of Costs filed on September 22, 2022, in the amount of $2,258.34.

Plaintiff Creditor’s Adjustment Bureau, Inc.’s Motion for Attorney’s Fees and Costs is GRANTED IN THE AMOUNT OF $17,580.00 ATTORNEY’S FEES AND $2,258.34 COSTS.