Judge: Ronald F. Frank, Case: 22TRCV00176, Date: 2023-01-13 Tentative Ruling
Case Number: 22TRCV00176 Hearing Date: January 13, 2023 Dept: 8
Tentative Ruling
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HEARING DATE: January 13, 2023¿
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CASE NUMBER: 22TRCV00176
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CASE NAME: Garry
Cassidy, Garry Cassidy Construction v. Two Coast Brewing Company, LLC, et. al. .
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MOVING PARTY: Defendants, Two Coast Brewing Company, LLC, Roger
Kunsemuller, Jan Dreier, Suretec Insurance Company, Gerald W. Mouzis, The
Mouzis Law Firm, APC
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RESPONDING PARTY: Plaintiff,
Garry Cassidy
TRIAL DATE: None set
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MOTION:¿ (1) Motion for Attorneys’ Fees
and Costs
Tentative Rulings: (1) GRANTED, and because of the
Trope issue the Court awards 50% of the requested $33,253 or $16,626.50 in
attorneys’ fees to the non-attorney defendants as an equitable allocation
between the attorney co-defendants and the non-attorney co-defendants who
prevailed on the anti-SLAPP motion. $344.05
in costs are awarded as well.
I. BACKGROUND¿
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Plaintiff Garry Cassidy, individually and doing business as
Garry Cassidy Construction (“Plaintiff”) filed this action on March 8, 2022.
Since then, Plaintiff has filed two amended complaints. Plaintiff’s second
amended complaint alleges the following: (1) breach of contract; (2) breach of
implied covenant of good faith and fair dealing; (3) foreclosure of mechanic’s
lien; (4) violation of civil code § 8800, et seq.; (5) common counts; (6)
intentional infliction of emotional distress; and (7) negligent infliction of
emotional distress. This action is based on a construction contract between
Plaintiff, a general contractor, and Defendant Two Coast Brewing Company
(“TCB”) for improvements to TBC’s microbrewery business.
In the SAC, Plaintiff named TCB, Mr. Kunsemuller, Mr. Dreier, the
Firm and Mr. Mouzis as defendants, alleging intentional and negligent
infliction of emotional distress on the Sixth and Seventh Causes of Action. The
Firm acted in pro per in representing itself and Mr. Mouzis. The Firm
also acted as counsel of record for TCB, Mr. Kunsemuller, and Mr. Dreier.
Defendants claim that all of these defendants were improperly named on the
Sixth and Seventh causes of Action.
On December 12, 2022, the court granted the Defendants’ Anti-SLAPP
Motion. Since Defendants prevailed on their Anti-SLAPP motion, they are
requesting an award of their attorneys’ fees, noting that such an award is
mandatory under Code of Civil Procedure § 425.16(b)(1). Defendants assert that
their reasonable attorneys’ fees incurred for the filing of the Anti-SLAPP
motion is in the total amount of $33,597.05
¿II. ANALYSIS
A. Legal Standard
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The
prevailing party on a special motion to strike is entitled to an award of
reasonable attorney fees. (Code Civ. Proc., §¿425.16, subd. (c).)
A
‘reasonable’ attorney’s fee award generally falls “within the sound discretion
of the trial judge.” (Church of Scientology v. Wollersheim (1996) 42
Cal. App. 4th 628, 659.) However, in making a determination on the
reasonableness of attorney’s fees and costs, a trial court should consider (1)
the nature of the litigation, (2) its difficulty, (3) the amount involved, (4)
the skill required and the skill employed in handling the litigation, (5) the
attention given, (6) the success of the attorney's efforts, (7) his learning
and age, (8) his experience in the particular type of work demanded the
intricacies and importance of the litigation, and (9) the labor and necessity
for skilled legal training and ability in trying the cause, and (10) the time
consumed. (Id. at pp. 638-39.)
B. Discussion
Defendants request an attorney fee
award of $33,597.05. This fee is made up of the correspondence to Plaintiff’s
counsel attempting to resolve the issue without need for the Anti-SLAPP motion,
researching, drafting and preparing the Anti-SLAPP motion, analyzing
Plaintiff’s Opposition and replying thereto, drafting supplemental briefing,
reviewing the reply thereto, preparing for two hearings in connection with the
Anti-SLAPP Motion, preparing the instant motion, and an anticipated six hours
incurred to prepare Defendants’ reply to Plaintiff’s opposition to this motion.
Nature & Difficulty of Litigation
This case is based on a contractual dispute. Defendants
argue that Plaintiff elevated this matter by seeking to foreclose on an allegedly
invalid mechanic’s lien and alleging causes of action for emotional distress
based on speech protected by the litigation privilege. The challenged causes of action were alleged against
not only the party with whom Plaintiff contracted, but also its principals and
its counsel. As such, Defendants suggest
that this litigation, as presented to the Court, was far more than a direct
breach of contract matter. Defendants further assert that the nature of the
litigation is difficult as an Anti-SLAPP motion is a sophisticated motion that
takes considerable skill and effort to effectively draft and then argue in
order to prevail.
Amount in Controversy
Defendants acknowledge that the amount plead by Plaintiff
is $33,028.05. However, Defendants assert that the potential exposure to
Defendants could have been in excess of $100,000 to $150,000 when Plaintiff had
a potential for punitive damages sought in their Sixth and Seventh causes of
action and payment penalties of 2% per month and attorneys’ fees, which were
sought in the SAC.
Skill Required & Employed
Defendants
assert that significant skill was required and exhibited on both sides of this
case by legal counsel to address the issues and present them to the court.
Defendant contends that the matter should have been resolved prior to bringing
the Anti-SLAPP motion, and that but for Plaintiff’s desire to expand the scope
of the litigation to beyond a contract dispute and to sue legal counsel for
Defendant, the matter likely could have resolved by settlement even before
filing of the litigation. Defendants also contend that its legal counsel
employed the utmost skill in effectively presenting evidence to the trier of
fact.
Attention Given
Defendants assert that in preparation of the Anti-SLAPP
motion and related briefing, full attention was given to the matter by counsel
for Defendants at the expense of other work at the office for which reasonable
fees would have been incurred (Declaration of Gerald W. Mouzis (“Mouzis
Decl.”), ¶ 16.)
Success of Attorney’s Efforts
Defendants
note that they prevailed, obtaining a trial court Order in their favor,
striking both causes of action for emotional distress, the sole subject of the
Anti-SLAPP Motion. (Mouzis Decl., ¶ 9.)
Attorney
Counsel
for Defendants note that he was admitted to the practice of law in California
in 1980 and has served clients on a continuous basis since that time. (Mouzis
Decl., ¶ 10.) Mr. Mouzis notes that by his best estimate, he has represented
clients for more than 42 years in approximately 35 to 40 jury trials, bench
trials, binding arbitration proceedings and/or non-binding arbitration
proceedings. (Mouzis Decl., ¶ 10.) Mr. Mouzis noted that after his first two
decades of practice, he joined a firm that specialized in construction contract
litigation and related disputes. (Mouzis Decl., ¶ 11.) Mr. Mouzis notes that for approximately the
past 13 years, his practice has been almost exclusively devoted to complex
construction contract and tort liability litigation, providing legal
representation to owners, contractors, subcontractors, vendors and material
suppliers involved in both public and private construction projects. (Mouzis
Decl., ¶ 11.) He also contends that he currently serves as a mediator and
arbitrator though an alternative dispute resolution company, IVAMS. (Mouzis
Decl., ¶ 11.)
Mr. Mouzis
notes that based upon his 40+ years of legal practice, the last 23 of which
have been almost exclusively devoted to the construction-related field, and his
past review of rates of other attorneys with similar background and experience,
it is his understanding that his hourly rate of $325.00/hour is below market
for a 42-year practitioner involved in complex construction contract
litigation. (Mouzis Decl., ¶ 12.)
Mr. Mouzis
also noted that he engaged Amanda L. Voivedich, a Senior Associate with the
firm, to assist with the handling of this matter. Ms. Voivedich is now a
12-year attorney and graduate of Chapman University School of Law. (Mouzis
Decl., ¶ 13.) Mr. Mouzis noted that she was charged predominantly with the
day-to-day handling of this matter and communications with opposing counsel
regarding this Motion. (Mouzis Decl., ¶ 13.) However, Mr. Mouzis noted that he
was required to assume some responsibility for the matter due to the intimate
nature of the allegations against the Firm and him. (Mouzis Decl., ¶ 13.) Mr.
Mouzis notes that he minimized his involvement to the greatest extent possible.
(Mouzis Decl., ¶ 13.) Mr. Mouzis contends that for time incurred through the
filing of this Motion, Ms. Voivedich’s hourly rate was $260.00. (Mouzis Decl.,
¶ 13.)
Time Consumed
Mr. Mouzis claims that Defendants TCB, Mr. Dreier, and Mr.
Kunsemuller, in connection with the Anti-SLAPP motion and instant motion for
attorneys’ fees and costs, have incurred 120.25 hours of attorney time,
consisting of 32.6 from Mr. Mouzis and 87.65 from Ms. Voivedich. (Mouzis Decl.,
¶¶ 14-15; Exhibit 1.) Defendants assert that this time included the drafting of
correspondence to Plaintiff’s counsel attempting to resolve the issue without
need for the Anti-SLAPP motion, researching, drafting and preparing the
Anti-SLAPP motion, analyzing Plaintiff’s opposition, and replying thereto,
drafting supplemental briefing, reviewing the reply thereto, preparing for two
hearings in connection with the Anti-SLAPP motion, and preparing the instant
motion. (Mouzis Decl., ¶¶ 14-15; Exhibit 1.) Defendants anticipate that another
sic hours will be incurred to prepare Defendants’ reply to Plaintiff’s
opposition to this motion and to attend the hearing on the motion for an
additional amount of $1,560. (Mouzis Decl., ¶¶ 14-15; Exhibit 1.) In addition,
Defendants not that there were Court filing and electronic filing fees for the
Anti-SLAPP motion and for the instant motion (and related briefing for a total
amount of filing fees of $344.05. (Mouzis Decl., ¶¶ 14-15; Exhibit 1.)
Reasonability
Defendants assert that attorneys’ fees in the amount of
$33,597.05 are reasonable for the above listed reasons. However, Plaintiffs
assert that it is unreasonable for the Mouzis Defendants to have billed the TCB
Defendants $33,253.00 for work on an Anti-SLAPP Motion that targeted causes of
action arising from the Mouzis Defendants’ conduct, and which the Mouzis
Defendants admittedly performed for their own benefit. Plaintiff relies on the
California Supreme Court holding in Trope v. Katz to argue that
self-represented attorneys and firms may not recover attorneys’ fees on an
Anti-SLAPP motion, and Plaintiffs belief that the fee motion brought solely by
the TCB Defendants is an attempt to circumvent that rule.
In Trope v. Katz, the Supreme Court held that “an
attorney who chooses to litigate in propria persona and therefore does not pay
or become liable to pay consideration in exchange for legal representation
cannot recover ‘reasonable attorney’s fees’ under [Civil Code] section 1717 as
compensation for the time and effort he expends on his own behalf or for the
professional business opportunities he forgoes as a result of his decision.” (Trope
v. Katz (1995) 11 Cal.4th 274, 292.) The Court’s reasoning was partially
based on language in section 1717 which makes it applicable to attorney fees
“which are incurred to enforce [a] contract.” (Id. at 280.) Relying on
the dictionary definition of “incur” as to “become liable” for, the court
concluded that the language of section 1717 requires that a party must have
actually paid attorneys fees or has “become liable to pay consideration in
exchange for legal representation. (Ibid.) The holding in Trope,
however, was specifically limited to section 1717. (Id. at 290.)
In Plaintiff’s opposition, he cites to Gorman v.
Tassajara Development Corp.(2009) 178 Cal.App.4th 44. In Gorman,
a homeowner, who was also an attorney in an incorporated law firm, represented
himself and his wife in a lawsuit brought against a general contractor who had
performed construction work on their residence. The construction contract
provided for the recovery of attorney fees to the prevailing party in any litigation
(Id. at 52.) The homeowner-attorney and his wife signed retainer
agreements with his law firm and another law firm. The parties settled the
lawsuit, and the settlement agreement included a clause deeming the homeowners
to be the prevailing parties for the purpose of recovering attorneys fees
pursuant to the terms of the construction contract. (Id. at 90.) The
husband and wife requested attorneys fees in excess of $1 million. The
contractor objected to the recovery of any fees by the homeowner-attorney’s law
firm whether billed by the husband or his associates and paralegals. The trial
court awarded only a portion of the fees requested and the homeowners appealed.
On appeal, the court discussed Trope and its progeny. It concluded that
there was no attorney-client relationship between the homeowner-attorney and
his wife. It stated, “[t]here is no indication that [the wife] suffered any
damages apart from those suffered by her husband. Their interests in this
matter appear to be joint and indivisible. There is no claim that Gorman spent
extra time he spent representing himself. There is no claim that each of them
owes half his fees. Their community estate is liable for their contracts. Since
[the husband’s] billable hours appear to be entirely attributable to
representing his common interests with [his wife], we conclude that the rule of
Trope applies to this situation.” (Id. at 95.)
In
their reply brief, Defendants argue that Gorman is distinguishable
because the Gorman court based its decision around the wife not having
an attorney-client relationship with her husband, and that the husband and
wife’s damages were joint and indivisible because there was no indication that
the spouse suffered separate damages from her attorney spouse and their
community estate is liable for their contracts. Defendants contend that the
relationship between the TCB defendants and the Mouzis defendants is inherently
distinguishable because they are in no way jointly tied to the firm outside of
their attorney-client relationship nor is there an issue of community interest.
Plaintiff also cites to Carpenter & Zuckerman, LLP
v. Cohen (2011) 195 Cal.App.4th 373. In Carpenter, a law firm and
its two partners were named as defendants in an action for defamation and
tortious interference with economic advantage. During the action, an associate
attorney employed by the law firm represented the defendants. (Id. at
377.) After the associate succeeded in having the complaint dismissed under the
anti-SLAPP law, the trial court rejected the defendants’ fee requests. (Ibid.)
In affirming the denial of the firm’s fee request, the appellate court
concluded that the associate’s representation of the law firm amounted to self-representation
by the firm. Pointing to Gorman, the appellate court also concluded the
individual attorney defendants were not entitled to an award, as there was no
showing that the complaint “subjected them to potential individual liability
separate and apart…from their law firm.” (Id. at 386.)
In reply,
Defendants also argue that the facts of Carpenter are distinguishable.
Defendants argue that they are not attorneys or associates of the firm.
Instead, Defendants TCB are non-attorney litigants that retained the firm to
represent their individual interests in a contractual matter with Plaintiff. As
non-attorney litigants, Defendants TCB are subject to paying the firm
attorneys’ fees for the firm’s representation.
The Court notes that the 6th
and 7th causes of action were alleged in the original and first
amended complaint, not only the SAC. The
Law Firm and Mr. Mouzis are defendants only in those two causes of action and
no others, but TCB, Kunsemuller and Dreier are named in every causes of
action. TCB, Kunsemuller and Dreier had
liability, if any, that was solely derivative of the actions by their lawyer
and lawfirm pre-litigation; they are not bound by Rule 3.10 of the Rules of Professional
Responsibility, and they did not author or transmit the pre-litigation letter
containing the purported threat. The focus
and thrust of those two causes of action as well as the anti-SLAPP briefing was
on the Lawfirm and Mr. Mouzis, not his clients.
The moving parties on the anti-SLAPP Motion are listed as all the
defendants, including the Law Firm and Mr. Mouzis. A civil litigation defendant such as Mr.
Mouzis of his Lawfirm are not entitled to attorney fees when prevailing
on an anti-SLAPP motion “because they represented themselves in the litigation
and, therefore, did not incur attorney fees.”
(Witte v. Kaufman (2006) 141 Cal.App.4th 1201, 1207.) “Under Trope and its
progeny, . . . a party, whether or not
he is an attorney, who is not represented by counsel and who litigates an
anti-SLAPP motion on his own behalf may not recover attorney fees under the
statute.” (Taheri Law Group v. Evans (2008)
160 Cal.App.4th 482, 494.) Here, a slightly
different situation is presented because there were multiple defendants named
in the 6th and 7th causes of action, two of whom are a
lawyer and a lawfirm but three of whom were not. The anti-SLAPP motion was brought not just by
a lawyer and his firm on their own behalves, but also on behalf of their clients
who were, unfortunately for Plaintiff here, needlessly added as defendants to
the two emotional distress causes of action.
Unlike Witte, Taheri, Carpenter and Ellis Law
Group LLP v. Nevada Sugar Loaf Properties, LLC (2014) 230Cal.App.4th
244, 257, the moving parties here included both a lawyer and a non-lawyer defendant. This case appears more similar to the facts presented
in Ramona Unified School Dist. v. Tsiknas (2005) 135 Cal.App.4th
510.
In Ramona, attorney Hamilton was a co-defendant
with her non-attorney clients to whom she provided legal assistance. The Fourth District recognized the general rule
that “where an attorney-client relationship exists, the courts uniformly allow
for the recovery of attorney fees” as prevailing parties in an anti-SLAPP
motion. (Ramona, supra, 135
Cal.App.4th at p. 524.) The court concluded
that Trope v. Katz did not bar an award of attorney fees for
Hamilton's legal services even though he represented both himself as a co-defendant
and separately named non-attorney co-defendants. The attorney fee motion here is brought by
all the moving defendants, including Mr. Mouzis and his Lawfirm. There is no allocation of the hours or
activities Mr. Mouzis or his associate incurred on the lawyers’ behalves as
distinct from those on behalf of the non-lawyer clients. Footnote 1 attempts to wall off the Trope
issue by disclaiming the pursuit of attorneys’
fees for Mr. Mouzis himself and his lawfirm, but the transparent effort to “footnote
around” the Trope issue cannot be ignored. Further,
unlike Ramona, the substantive allegations attacked by the anti-SLAPP
motion here were entirely the lawyers’ doing, not the clients’. The Court tentatively awards 50% of the requested
legal fees to Two Coast, Kunsmemuller and Dreier, and none to Mr. Mouzis and his
lawfirm, as a rough approximation of an equitable allocation of fee incurred to
extricate all five co-defendants from the emotional distress and potential
punitive damages allegations, consistent with Trope and its progeny.
IV. CONCLUSION¿¿¿
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For the foregoing reasons, Defendants’
Motion for Attorney’s Fees and Costs is GRANTED in the amount of $16,626.50 in attorneys’ fees to the non-attorney defendants
as an equitable allocation between the attorney co-defendants and the non-attorney
co-defendants who prevailed on the anti-SLAPP motion, plus $344.05 in costs.
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