Home -> Law Blog Directory -> Litigation Blogs -> CalBizLit

Litigation

: CalBizLit

Attorneys' Fee Awards in California III: More Attorney Fee Shifting Statutes

By Bruce Nye

    In an earlier post, I wrote about contractual fees to the prevailing party, how a one-sided fee provision in a contract becomes bilateral by operation of law, and how a narrow fee provision can relate to all disputes between the parties to a contract.  In a second post, I discussed fee awards in civil rights, employment and public interest litigation.

    There are scores of fee-shifting statutes in California, many of them dealing with fairly rare and obscure kinds of litigation.  But in this post, I?m going to talk about a few of them, roughly in the order of likelihood that a business litigating in this state is likely to encounter them.

    The post continues after the jump.

1.     Wage and Hour Violations:

    This is the one of the hottest areas of legal battles in California, and in the United States.  A recent report by Littler Mendelson, P.C., the nationwide employment law defense power house, claims that there were at least 311 wage and hour class actions filed in California in just the six months ending March 31, 2008.

    But California law provides for attorneys? fees even in non-class action wage and hour litigation, in actions for  (a)  failure to pay wages, fringe benefits, or health and welfare or pension fund contributions (to the prevailing party, Labor Code section 218.5);  (b) failure to pay the minimum wage and required overtime  (to the prevailing plaintiff only, Labor Code section 1194(a));  (c) failure to provide meal and other breaks, and other violations providing for penalties  (Labor Code section 2699(g)(1));  (d)  failure to reimburse for work-related  expenses (Labor Code section 2802(c) );  and (e)  failure to provide statutorily required itemizations on pay check stubs (Labor Code section 226(e)).

    There is also an attorneys? fee provision in California?s catch-all ?Private Attorneys? General Act of 2004.? 

2.     The Consumer Legal Remedies Act:

    This Act, at Civil Code section 1750 and following, prohibits 23 different ?unfair methods of competition and unfair or deceptive acts or practices undertaken by any person in a transaction intended to result or which results in the sale or lease of goods or services to any consumer.?  The act is at the core of much consumer litigation in this state, and prohibits everything from ?[r]epresenting that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model, if they are of another? to ?inserting an unconscionable provision in the contract.?

   Civil Code section 1780  sets out the remedies, including injunction, restitution of property, punitive damages, actual damages ?but no less than one thousand dollars ($1,000),? an extra $5,000 for seniors under certain circumstances, and, of course, attorneys? fees for a prevailing plaintiff.  Fees are also awardable to a prevailing defendant ?upon a finding by the court that the plaintiff?s prosecution of the action was not in good faith.?

3.     Song Beverly Consumer Warranty Act

    This act, Civil Code section 1790 and following, is also known as California?s ?lemon law? and is also a hot number in consumer litigation.  The act regulates and supplements express and implied warranties concerning consumer goods, effectively defines when a product (often, but not always an automobile) is a ?lemon,? and requires manufacturers to take back ?lemons? which cannot be repaired with a reasonable number of attempts or within a reasonable period of time. 

    The remedies section, Civil Code section 1794, includes a right of product replacement or restitution, as well as treble damages for willful warranty violations and, of course, attorneys? fees.

4.     Automobile Sales Finance Act

    The sale of automobile financing by dealerships is a heavily regulated business in California, as the legislature continues to find newer and more complex ways to guard consumers against perceived abuses.  The applicable statutes begin at Civil Code section 2981. They not only incorporate the Federal Truth in Lending Requirements and the Federal Reserve Bank?s Regulation Z,  but contain hundreds of other requirements concerning disclosures, the sale of service contracts, insurance products, theft deterrent devices, etc., ?held checks,? and much more.

    The remedial portion of the act is particularly draconian:  the remedy for even some of the most technical errors can be rescission of the contract, return of the car and a refund or all of the consumer?s money, even years after the sale.


    And, of course, under Civil Code section 2983.4, the ?prevailing party? is entitled to attorneys? fees in ?any action on a contract or purchase order? subject to the act.  Interestingly, a defendant who realizes he owes under the act can allege in its answer that it tendered the full amount owed to plaintiff,  that it then deposited that amount in court, and if that allegation turns out to be true, ?then the defendant is deemed to be a prevailing party within the meaning of this section.?  Untested is whether the amount tendered must, itself, include attorneys? fees to date.

5.     Vehicle Leasing Act

    Vehicle leases are regulated in a manner similar to vehicle installment sales, and the applicable provisions begin at Civil Code section 2985.7.  Similar attorneys? fees provisions appear at Civil Code section 2988.9.

6.     Unruh Civil Rights Act

    This act (Civil Code section 51 and following), first enacted in California in 1905, prohibits business discrimination on the basis of sex, race, color, religion, ancestry, national origin, disability, medical condition, marital status or sexual orientation, but it has been interpreted to broadly prohibit any arbitrary discrimination, and has been applied to prohibit discrimination against peace officers, folks with children, and someone who associated with somebody else who dressed unconventionally.  I posted at length on the subject here.

    Civil Code section 52 provides for attorneys? fees for violation of the act, while section 54.3 authorizes plaintiff fees in actions by blind and other physically disabled persons.

7.      Anti-Slapp Actions

    One of these days, I plan to write a white paper on California?s Anti-SLAPP Statue, Code of Civil Procedure section 425.16.   For purposes of this post, it suffices to say that California law allows an early, expedited ?Special Motion to Strike? directed against ?Strategic Lawsuits Against Public Participation,? and in opposing such a motion, the plaintiff must establish that there is a ?probability? the plaintiff will prevail on the claim.  Otherwise, his complaint will be stricken at the outset, and the defendant will be entitled to attorneys? fees and costs.

    Further, the cases hold that even if the special motion to strike is only partially successful (e.g., only eliminates some, but not all causes of action), the defendant is still a prevailing party.

    If the special motion to strike is not successful, the plaintiff gets fees only if the court finds the ?special motion to strike is frivolous or is solely intended to cause unnecessary delay.?

8.    Uniform Trade Secrets Act

    The act is at Civil Code section 3426 and following. Section 3426.4 provides for attorneys fees and costs in misappropriation cases, but for the plaintiff, only if the misappropriation was ?willful and malicious,? or, if the claim is resisted or a motion to terminate an injunction is resisted in bad faith.  The defendant can recover fees and costs if the claim is made in bad faith or if a motion to terminate injunction is resisted in bad faith.  And ?costs? in this context can include experts fees.

9.     Environmental Cleanup Cases

    Government Code section 8670.56.5 authorizes fees for persons damaged by oil spills into marine waters. Health & Safety Code section 25395.84  does the same in some environmental cost recovery actions.  Civil Code section 3333.5  provides fees to a person damaged by a pipeline spill.

10.     Frivolous Actions

    And finally, Code of Civil Procedure section 128.5.  This statute, California?s version of FRCP Rule 11, permits fee shifting against either a party or attorney when fees are incurred ?as a result of bad-faith actions or tactics that are frivolous or solely intended to cause unnecessary delay.?  ?Actions and Tactics? include, but are not limited to, ?the making or opposing of motions or the filing and service of a complaint or cross-complaint.?  Frivolous means ?(A) totally and completely without merit or (B) for the sole purpose of harassing an opposing party.? 

    Obviously a pretty high burden, and the statute is infrequently used.

Full post as published by CalBizLit on May 14, 2008 (boomark / email).