Much Less Awarded Than Requested $1.042-1.390 Million in Fees; Plaintiff Stipulated to Costs Reduction, With Modified Judgment Entered Accordingly.
This case is an interesting illustration of how lower courts will reduce an inflated fee request to calculate a lodestar as well as enforce a “high/low” stipulation that was silent with regard to fees/costs. The opinion shows good some good and bad things each side did in this case, providing practice pointers (or, as co-contributor Mike says, “we all learn good case management through mistakes”).
Gerard v. BHC Alhambra Hospital, Inc., Case No. B248197 (2d Dist., Div. 7 Mar. 18, 2014) (unpublished) involved a plaintiff suing defendant for claims mainly coalescing around dependent adult abuse charges. The good defense preventive action was getting both sides to agree, before the jury returned from deliberations, to a “high/low” stipulation putting a ceiling and floor on any gross jury verdict, namely no more than $2.25 million as the “high” and $250,000 as the “low.” The bad thing for the defense is it was silent on the issue of fees and costs, although a defense representative felt it had been conceptually agreed to the restriction also encompassing fees/costs before—although nothing was put on the record about such an arrangement. Wanna guess the jury verdict? Answer: a little shy of $6 million, with the lower court honoring the $2.25 million ceiling parameter. Then, plaintiff moved to recover statutory fees under the dependent abuse statute (Wel. & Inst. Code, § 15657(a)) of a requested $1,042,898.62 - $1,390,531.50 range (inclusive of a requested 1.5-2.0 multiplier). This was found by the lower court to be an inflated request, which made deductions for excessive/inefficient/block billed time, excessive hourly rates (rejecting $375 and $600 requested rates because the case was not that complex), and non-recoverable medical negligence work time, also denying any positive multiplier to plaintiff. The lower court gave a 52% across –the-board reduction, awarding fees of $333,727.56 plus eventual costs of $118,229.80.
Defendant hospital appealed on numerous bases, obtaining only a costs reduction conceded by plaintiff.
The defense argument that no fees/costs were awardable based on the “high/low” stipulation failed because the stipulation was silent on this important topic and also only discussed the arrangement in connection with the “gross jury verdict.” (PRACTICE TIP #1: Deal expressly with fees/costs in any such stipulation, a settlement agreement, or a 998 offer.) Also, unlike federal courts, the superior judge here did not have to “show his/her work” by providing the math breakout of the award, given that the reasons for the reduction were articulated. (PRACTICE TIP #2: Although no statement of decision is required in state courts, co-contributor Mike likes to provide the math in the ultimate fee order—listing the hourly rate and amount of work found reasonable, plus any reasons for an enhancement or an award of “fees on fees”.) Plaintiff did agree that certain expert witness fees and investigation/copying/postage fees were not recoverable under Davis v. KGO-T.V., Inc., 17 Cal.4th 436, 438 (1998) [statutory FEHA case], stipulating to a costs recovery of $31,016.32 which was adopted by the appellate court. (PRACTICE TIP #3: If you recognize that an award should be reduced either substantively or due to arithmetic errors, concede it in the brief so that the appellate court can just modify the judgment and affirm—avoiding time by another trip before the lower court.)