Thursday, October 15, 2015
Both Sides Can ‘Prevail’ Under Fee-Shifting Statutes—C.A.
By a MetNews Staff Writer
When a case involves two different fee-shifting statutes, and each side prevails on a claim that permits it to recover fees, the court can apply both statutes and give offsetting awards, the Court of Appeal for this district ruled yesterday.
Div. Five, in an opinion by Justice Richard Mosk, said Los Angeles Superior Court Judge Rolf M. Treu ruled correctly in a case where an employee sued her employer on two different claims, and each party prevailed on one of the causes of action.
The employee, Mahta Sharif, worked for Mehusa, Inc., a Beverly Hills-based company that exports food, primarily to the Middle East. She sued the company for unpaid wages and overtime totaling more than $260,000, and for violation of the state Equal Pay Act.
A jury ruled that the defendant violated the equal pay statute, and awarded $26,300 in damages, but found that the company did not owe Sharif any wages or overtime.
The plaintiff’s attorneys sought an attorney fee award of $280,000, claiming a lodestar of $140,000 and a multiplier of two. The defense moved for attorney fees for successfully defending the wage claims under Labor Code §218.5.
Mehusa’s lawyers argued that they were entitled to fees of $30,000. They claimed that their total fees and costs on the case were nearly $40,000, and that 75 percent of their work was devoted to the wage claims and 25 percent to the Equal Pay Act.
The plaintiff responded that she was the sole prevailing party on a “practical level,” since she had won an award of damages.
Treu concluded that each party was a prevailing party on a different claim, and entitled to attorney fees under a different statute. He concluded that defendant’s request for $30,000 was reasonable, but that plaintiff’s claim was inflated.
Concluding that the plaintiff’s lawyers, like the defendant’s, had devoted about 25 percent of their time to the Equal Pay Act claim and about 75 percent to the wage claim, he cut the plaintiff’s fee award to about $35,000 and offset the defense award.
Mosk said this was the correct approach.
“[I]f plaintiff had brought her wage and Equal Pay Act claims in separate actions, defendant would have been entitled to recover its attorney fees in the action asserting the wage claim and plaintiff would have been entitled to recover her attorney fees in the action asserting the Equal Pay Act claim,” the justice reasoned. “There is no legal or logical reason why defendant should be precluded from recovering its attorney fees on plaintiff’s wage claim simply because plaintiff combined her wage and Equal Pay Act claims in a single action. By providing that the prevailing party under one statute is entitled to fees, and that a different prevailing party under another statute is entitled to fees, the Legislature expressed an intent that there can be two different prevailing parties under separate statutes in the same action. Thus, a net monetary award to a party does not determine the prevailing party when there are two fee shifting statutes involved in one action.”
The justice went on to say, in an unpublished portion of the opinion, that Treu did not abuse his discretion in slashing the plaintiff’s fee request.
The judge did not, as the plaintiff claimed, arbitrarily conclude that the hours spent by the defendant in order to defeat the wage claim were “inversely proportional to the amount of time” the plaintiff spent on the Equal Pay Act claim, Mosk said. Rather, Treu used the defense’s figures as a reasonable measurement after concluding that the plaintiff’s lawyers were unreasonable in claiming that nearly all of their time was related to the Equal Pay Act claim, an acceptable approach, the justice said.
The case is Sharif v. Mehusa, Inc., 15 S.O.S. 4838.
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