Judge: Virginia Keeny, Case: 20STCP00235, Date: 2025-01-14 Tentative Ruling

All rulings shown here are TENTATIVE ONLY, and thus oral argument WILL be heard. All Counsel are still required to attend.

Case Number: 20STCP00235    Hearing Date: January 14, 2025    Dept: 45

HUDOCK EMPLOYMENT LAW GROUP v. CELEBRITY HOMEHEALTH, INC., ET AL.

1.      motion for attorneys’ fees

2.      Motion to Tax Costs and Strike Costs

Date of Hearing:           January 14, 2025                         Trial Date:        NA

Department:                   45                                                          Case No.:         20STCP00235

1.      MOTION FOR ATTORNEYS’ FEES

Moving Party:                 Respondent Celebrity HomeHealth Inc.

Responding Party:      Petitioner Hudock Employment Law Group

2.      MOTION TO TAX AND STRIKE COSTS

Moving Party:                 Plaintiff Hudock Employment Law Group

Responding Party:      Petitioner Celebrity HomeHealth Inc.

BACKGROUND

On January 17, 2020, petitioner Hudock Employment Law Group (“Petitioner”) commenced this action by filing its petition to confirm contractual arbitration award. The petition arises from petitioner’s dispute with respondents Celebrity HomeHealth, Inc. and David Bustan (collectively “Respondents”), involving unpaid legal services in an employment law matter. (Petition, ¶ 5.) The arbitrator awarded a total amount of $69,360.62 to Petitioner. (Petition, ¶ 8b(1).)

On August 12, 2021, the court granted Petitioner’s petition to confirm arbitration award and awarded petitioner attorney’s fees and costs in the reduced amount of $1,942.50 and interest in the amount of $9,880. (Minute Order 08/12/21.)

On September 3, 2021, the court ordered judgment entered for Petitioner against Respondents in this matter in the total amount of $81,183.12, based on $69,360.62 in damages, $9,880.00 in prejudgment interest, $1,275.00 in attorney fees, and 667.50 in costs. (Minute Order 09/03/21.)

The Court of Appeal remanded this matter for an evidentiary hearing to determine whether a valid arbitration contract exists between Petitioner and Celebrity HomeHealth, Inc. (“Respondent”).

On September 12, 2024, the court denied Petitioner’s petition to confirm arbitration award against respondent Celebrity HomeHealth, Inc., finding no arbitration agreement exists between the two parties. The Court affirmed judgment as to respondent David Bustan. (Minute Order 09/12/24.)

On September 30, 2024, Respondent filed its memorandum of costs, requesting $952.85 for filing and motion fees, $489.53 for service of process, $2,990.00 for court reporter fees as established by statute, $134.12 for models, enlargements, and photocopies of exhibits, $741.15 for electronic filing or service fees, and $8,230.76 for other fees, for a total amount of $13,538.41. The memorandum of costs provides attorney fees will be determined by motion. 

On October 16, 2024, Petitioner filed its motion to tax and strike costs in response to Respondent’s memorandum of costs. On December 31, 2024, Respondent filed its opposition, and on January 7, 2025, Petitioner filed its reply.

On November 8, 2024, Respondent filed its motion for attorneys’ fees, to which Plaintiff opposed on December 31, 2024, and which Respondent replied on January 7, 2025.

Both motions are set for hearing on January 14, 2025.

[Tentative] Ruling

1. Respondent Celebrity HomeHealth, Inc.’s motion for attorney fees is granted in the reduced total amount of $63,000.

2. Petitioner Hudock Employment Law Group’s motion to tax and strike costs is granted in the reduced total amount of $3,942.85. Respondent Celebrity HomeHealth, Inc. is therefore entitled to costs in the reduced amount of $9,595.56.

1.      MOTION FOR ATTORNEYS’ FEES FILED BY RESPONDENT CELEBRITY HOMEHEALTH, INC. ON 11/08/24

LEGAL STANDARD

Code of Civil Procedure Section 1293.2, which pertains to arbitration proceedings, provides that the court “shall” award costs for judicial proceedings as provided in Chapter 6 of the Code. A petition to compel arbitration is a judicial proceeding. (Otay River Constructors v. San Diego Expressway (2008) 158 Cal. App. 4th 796, 805.) Code of Civil Procedure Section 1033.5, which is in Chapter 6, in turn provides that costs recoverable by a prevailing party include filing and motion fees, service fees, and attorney’s fees, when authorized by contract. (Code Civ. Proc. § 1033.5(a)(1), (4), (10); see also id., § 1032.) 

In addition, “[i]n any action on a contract, where the contract specifically provides that attorney's fees and costs, which are incurred to enforce that contract, shall be awarded either to one of the parties or to the prevailing party, then the party who is determined to be the party prevailing on the contract, whether he or she is the party specified in the contract or not, shall be entitled to reasonable attorney's fees in addition to other costs.” (Civ. Code §1717(a).)  

“[T]he fee setting inquiry in California ordinarily begins with the lodestar, i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate. California courts have consistently held that a computation of time spent on a case and the reasonable value of that time is fundamental to a determination of an appropriate attorneys’ fee award.” (PLCM Grp. v. Drexler (2000) 22 Cal 4th 1084, 1095.) The reasonable hourly rate is the prevailing rate for similar work in the community. (Ibid.) “The lodestar figure may then be adjusted, based on consideration of factors specific to the case, in order to fix the fee at the fair market value for the legal services provided.” (Ibid.)   

In determining whether to adjust the lodestar figure, the court may consider the nature and difficulty of the litigation, the amount of money involved, the skill required and employed to handle the case, the attention given, the success or failure, and other circumstances in the case. (EnPalm LLC v. Teitler (2008) 162 Cal.App.4th 770, 774.) 

DISCUSSION

Respondent requests an order awarding it attorneys’ fees in the amount of $74,585 for successfully defeating Petitioner’s petition to confirm the arbitration award and for this motion for attorneys’ fees and costs. Respondent argues it is entitled to a mandatory award of attorneys’ fees under Code of Civil Procedure sections 1293.2 and 1033.5. Respondent is also able to recover its fees under Civil Code section 1717 because it is the prevailing party and because the contract Petitioner sought to enforce contains a fees provision. Respondent’s counsel is entitled to a blended hourly rate of $350, and the 213.1 hours expended were reasonable.

Petitioner asks the court to deny the motion, arguing that respondent is not entitled to recovery of attorneys’ fees for the proceedings prior to and including the appeal pursuant to the at-issue fee agreement. Further, respondent has not met its burden of proof to establish the fees incurred are reasonable and not excessive.

Prevailing Party

Here, Petitioner’s argument that respondent is not entitled to recovery of attorneys’ fees pursuant for the proceedings prior to and including the appeal is meritless as it is not supported by law or the at-issue fee agreement, which states:

If the firm must make any efforts or institute any type of action to collect past due payments of fees and costs owed to the firm under this agreement, the prevailing party in that collection matter shall be entitled to reimbursement for all attorney fees and costs incurred in connection with such proceedings….

(Opp., p. 6.) Based on foregoing fee agreement, Petitioner argues there were, at minimum, four “proceedings”: (1) the arbitration; (2) the petition to confirm arbitration; (3) the appeal; and (4) the evidentiary hearing. (Opp., p. 7.) If any fees are deemed to be recoverable by Respondent, then such fees would be limited to the evidentiary hearing. (Ibid.) The court finds Petitioner’s argument unpersuasive and declines to parse out the action into separate “proceedings” and separate prevailing party analysis. In this case, the petition to confirm arbitration award was initially granted in Petitioner’s favor; however, the Court of Appeal remanded this matter to hold an evidentiary hearing to determine whether a valid arbitration contract exists between Petitioner and Respondent. Ultimately, on September 12, 2024, the court denied Petitioner’s petition to confirm arbitration award against Respondent, finding no arbitration agreement exists between the two parties. The Court affirmed judgment as to respondent David Bustan. Therefore, Respondent is the prevailing party in this proceeding entitled to recover its reasonable attorneys’ fees pursuant to Code of Civil Procedure Section 1293.2.

Reasonable Attorneys’ Fees

Respondent requests attorneys’ fees of $74,585, based on a blended hourly rate of $350 and the 213.1 hours expended.

Petitioner does not contest the blended hourly rate of $350 sought, as Petitioner’s opposition fails to address it entirely. Therefore, the court finds the blended hourly rate charged by Respondent’s counsel reasonable.

Respondent’s attorneys billed a total of 213.1 hours in connection with this action. (Declaration of Griffin Schindler, ¶ 2–14, Ex. 1–2; Declaration of David Bustan, ¶ 3–4.) Respondent provides the following chart:

(Motion, p. 14.)

Petitioner argues the fees sought by Respondent are unreasonable based on the Appellate Court order stating that the parties are to bear their own costs, the significant litigation created by Respondents, and unreasonable apportionment.

First, the Court of Appeal’s opinion stated that the parties are to bear their own costs, however it was silent as to fees. (10/18/22 Appellate Court Opinion.) Second, Petitioner’s argument that Respondents—Celebrity HomeHealth, Inc. and David Bustan—created excessive litigation by using delay tactics is unpersuasive as it is conclusory, and Petitioner’s statements against respondent David Bustan are not relevant as respondent David Bustan is not a party to this attorneys’ fees motion. Further, Petitioner fails to acknowledge the complexity of this case given the appeal and two-day evidentiary hearing. Lastly, the court declines to reduce fees via apportionment as Petitioner fails to account for the reality that certain costs would have been the same, especially in light of Petitioner’s decision to jointly bring this action against Respondents.

Notwithstanding the foregoing, the court will reduce the fee request by $5,005.00 in connection with the Motion to Vacate Judgment, which Respondent withdrew on November 22, 2023. The court will also reduce the fee request by $12,250 for work incurred by Respondent’s former counsel Donna Leung as Ms. Leung never provided her own declaration in support of the motion. The court will also reduce the fee request by $1,400 for work incurred by Jonathan Kent for the same reason as above.

On November 25, 2024, Respondent’s counsel filed a supplemental declaration in support of this motion, wherein counsel represents that an additional 20.2 hours in this matter have been reduced to an invoice since the filing of this motion. (Supplemental Declaration of Griffin Schindler, ¶ 3, Ex. 3.) The invoice reflects 2.4 hours performed by James Decker and 17.8 hours performed by Griffin Schindler, which, multiplied by $350 per hour, results in a total of $7,070, bringing the total fee sought to $81,655 ($74,585 and $7,070). (Ibid.) Petitioner does not contest the $7,070 as the opposition fails to address it.

CONCLUSION

Accordingly, the motion for attorneys’ fees is granted in the reduced total amount of $63,000.

2.      MOTION TO TAX/STRIKE COSTS FILED BY PLAINTIFF/PETIONER HUDOCK EMPLOYMENT LAW GROUP ON 10/16/24

LEGAL STANDARD

“[T]he prevailing party in a lawsuit is entitled as a matter of right to recover allowable costs under [Code of Civil Procedure] section 1032, subdivision (b) which provides ‘… (b) Except as otherwise expressly provided by statute, a prevailing party is entitled as a matter of right to recover costs in any action or proceeding.’” (Seever v. Copley Press, Inc. (2006) 141 Cal.App.4th 1550, 1557.) If the items on a verified memorandum of costs appear to be proper charges, they are prima facie evidence that the costs listed were necessarily incurred. (Ibid.) “[I]t is not enough for the losing party to attack submitted costs by arguing that he thinks the costs were not necessary or reasonable.” (Ibid.) “Rather, the losing party has the burden to present evidence and prove that the claimed costs were not recoverable.” (Ibid. [emphases added[; see also Jones v. Dumrichob (1998) 63 Cal.App.4th 1258, 1266 [denying motion to tax costs where “[n]o counter-declarations or other rebuttal documents were proffered by appellants to support factually the conclusory challenge to the necessity of the items in question”); Rappenecker v. Sea-Land Service, Inc. (1979) 93 Cal.App.3d 256, 266 [“Defendant’s mere statements in the points and authorities accompanying its notice of motion to strike cost bill and the declaration of its counsel are insufficient to rebut the prima facie showing.”].)

DISCUSSION

On September 30, 2024, Respondent filed its memorandum of costs, requesting $952.85 for filing and motion fees, $489.53 for service of process, $2,990.00 for court reporter fees, $134.12 for models, enlargements, and photocopies of exhibits, $741.15 for electronic filing or service fees, and $8,230.76 for other fees, for a total amount of $13,538.41. The memorandum of costs provides attorney fees will be determined by motion. 

Petitioner requests an order to tax and strike costs, arguing that the memorandum of costs filed on September 30, 2024 is unreasonable, unauthorized, vague, and Respondent appears to seek the unpermitted costs of respondent David Bustan, who was not determined to be a prevailing party.

In opposition, Respondent does not dispute the timeliness of Petitioner’s motion.  Instead, Respondent argues that the motion should be denied as its verified Memorandum of Costs is prima facie evidence and the costs were reasonably and necessarily incurred in its defense against Petitioner’s enforcement of the arbitration agreement.

The court finds that Respondent’s verified memorandum of costs, together with the declarations of Respondent’s counsel Griffin Schindler and respondent David Bustan, constitute prima face evidence that the costs listed were necessarily incurred. Contrary to Petitioner’s argument, Respondent is not required to set forth receipts. Further, Petitioner has presented no evidence to substantiate its claims that “[Celebrity HomeHealth, Inc.] and Bustan appear to merge their purported claims of costs.” (Motion, p. 6.)  As set forth above, “it is not enough for the losing party to attack submitted costs by arguing that he thinks the costs were not necessary or reasonable.” (Seever v. Copley Press, Inc. (2006) 141 Cal.App.4th 1550, 1557.)

Nonetheless, the Court strikes the following costs under C.C.P.  1033.5(c)(2) and (3):

1)      Appellate filing fees of $891.20 ($116.20 plus $775.00) under Item 1, as the Appellate Court ordered, “the parties are to bear their own costs on appeal.” (10/18/22 Appellate Court Opinion.)

2)      Motion to Vacate filing fee of $61.65 under Item 1, as the motion was withdrawn. (11/22/23 Notice of Withdrawal.)

3)      Court reporter fees of $2,990.00 under Item 11, as there is no statutory basis for such fees. (Code Civ. Proc. §1033.5, subd. (a)(11).)

4)      Travel costs in the amount of $6585.38 under item 16, as there is no statutory basis for such costs and they are neither justified nor reasonable.

5)      Transcript costs of $1338.10, as they were not ordered by the court and are not otherwise permitted by statute.  

CONCLUSION

Thus, Petitioner’s motion to tax/strike costs is granted in the reduced total amount of $11,866.33. Respondent Celebrity HomeHealth, Inc. is therefore entitled to costs in the reduced amount of $1672.08.