Litigation

Cal Supreme Court: Pre-Litigation Settlement Efforts Not a Prerequisite to Obtaining Private Attorney General Fees

By Bruce Nye

    California's private attorney general fees statute, Code of Civil Procedure section 1021.5, allows fees to lawyers bringing suit in the public interest, and sets forth the criteria for when fees will be allowed.  CalBizLit did a lengthy post on this subject here.  Other posts on different California attorneys' fees provisions appear here and here.  And you can always learn more than you ever wanted to know on the subject at the recommended blog, California Attorneys Fees.

    As discussed in the earlier 1021.5 post, the Cal Supremes adopted the catalyst theory in Graham v. DaimlerChrysler Corp. (2004) 34 Cal.4th 553, holding that a plaintiff may obtain fees even without obtaining a judgment if the "defendant changes its behavior substantially because of, and in the manner sought by, the litigation.?  However, catalyst fees are only allowed when the plaintiff seeking fees reasonably attempted to settle the matter short of litigation.

    Today, the Cal Supremes decided in Vasqez v. State of California (November 20, 2008) ___ Cal. 4th ____, S143710 that the bright line  Graham limitation -- no fees without a prelitigation effort to settle -- applies only to catalyst cases, not cases where the plaintiff obtains a judgment.  The presence or absence of a pre-litigation effort to settle is relevant to  "the necessity and financial burden of private enforcement," two of the elements to be considered by the trial court in determining whether to award fees.  But unlike catalyst cases, pre-litigation settlement effort is not an absolute prerequisite to obtaining fees.

    Also, the Court clarified that cases that settle with stipulated or consent judgments are not catalyst cases.

Full post as published by CalBizLit on November 20, 2008 (boomark / email).