United States Supreme Court
HARRY SCHEIN, INC. v. ARCHER AND WHITE SALES, INC.
Under the Federal Arbitration Act (FAA), the parties to a contract may agree that the arbitrator will resolve disputes arising out of the contract. When the parties have so agreed, even if there is a dispute regarding the threshold arbitrability question, the arbitrator must decide whether the case should proceed in arbitration. Some courts decided the threshold arbitrability question in cases where the argument for arbitration was “wholly groundless.” The wholly groundless exception is inconsistent with the FAA, and courts may not rewrite a statute passed by Congress and signed by the President.
Note: The Supreme Court did not interpret the California Arbitration Act, and California courts have used the “wholly groundless” exception when interpreting arbitrability under the CAA.
U.S. Supreme Court. Decided 1/8/19. 139 S. Ct. 524. Opinion by Justice Kavanaugh.
NEW PRIME INC. v. OLIVEIRA
PLAINTIFF OLIVEIRA FILED A CLASS ACTION LAWSUIT AGAINST A TRUCKING COMPANY
Plaintiff Dominic Oliveira was a driver for Defendant New Prime Inc., an interstate trucking company. Oliveira worked under an operating agreement that classified him as an independent contractor and contained a mandatory arbitration provision. When Oliveira filed a class action for wage violations, New Prime attempted to compel the matter to arbitration under the Federal Arbitration Act (“FAA”). Oliveira argued that he was exempt from arbitration under §1 of the FAA, which excludes disputes involving contracts of employment of certain transportation workers. The District Court and First Circuit agreed with Oliveira, and the Supreme Court affirmed.
BECAUSE SECTION 1 OF THE FEDERAL ARBITRATION ACT APPLIED, THE MATTER COULD NOT BE COMPELLED TO ARBITRATION
A court should determine whether the FAA’s §1 exclusion applies before compelling a case to arbitration. The arbitrator may not determine arbitrability where the case is excluded from the FAA under §1. To know whether the court has the power to compel the matter to arbitration under §§ 3 and 4, the court must first assess whether §1 applies. “The parties’ private agreement may be crystal clear and require arbitration of every question under the sun, but that does not necessarily mean the Act authorizes a court to stay litigation and send the parties to an arbitral forum.” In addition, “contracts of employment” under the FAA is interpreted broadly to include independent contractor work agreements. Therefore, §1 applied, and the matter could not be compelled to arbitration.
U.S. Supreme Court. Decided 1/15/19. 139 S.Ct. 532. Opinion by Justice Gorsuch.
California Courts of Appeal
BERKELEY CEMENT, INC. v. REGENTS OF THE UNIVERSITY OF CALIFORNIA
Plaintiff Berkeley Cement sued the Regents after a dispute over a construction project. A jury ultimately found for the Regents, and the trial court awarded costs to the Regents. Berkeley appealed. Generally, items allowable as costs are listed in CCP §1033.5(a), and items that are not allowable as costs, except when expressly authorized, are listed in CCP §1033.5(b). Items not listed in either section may be allowed or denied at the court’s discretion pursuant to CCP §1033.5(c)(4). Mediation costs are not listed in (a) or (b) and may therefore be awarded at the court’s discretion. This is true even if the parties voluntarily participated in mediation and were not ordered to mediate. Encouraging parties to resolve lawsuits before trial is a necessary part of litigation.
COA, 5th Dist. Filed 1/7/19. 30 Cal.App.5th 1133. Opinion by Justice Hill.
DUFFEY v. TENDER HEART HOME CARE AGENCY, LLC
PLAINTIFF DUFFEY SUED FOR OVERTIME VIOLATIONS UNDER THE DOMESTIC WORKER BILL OF RIGHTS
Plaintiff Nichelle Duffey sued Defendant Tender Heart for failure to pay overtime wages under the Domestic Worker Bill of Rights (“DWBR,” Labor Code §§1450, et seq.) The DWBR requires that domestic work employees receive overtime wages for all hours worked in excess of nine hours per day or 45 hours per week. The trial court granted summary adjudication for Tender Heart, finding that Duffey was an independent contractor, not an employee. After the trial court granted subsequent summary judgment of the remaining claims, Duffey appealed, and the Court of Appeal reversed.
COURTS MUST USE THE DOMESTIC WORKER BILL OF RIGHTS’ DEFINITIONS OF “EMPLOYER” WHEN ASSESSING WORKERS UNDER THE STATUTE
When assessing whether a person is an employee under the DWBR, courts must use the standard set forth in the DWBR itself, not the Borello standard. Though the DWBR’s definition of “employer” differs in some ways from the definition in the wage orders, it mirrors the exercise “control over the wages, hours, or working conditions” of a worker language from the wage orders. This mirroring indicates that, as with the wage orders, the legislature intended the DWBR to apply to both temporary employment agencies and the employers who contract with those agencies. In addition, the DWBR states that a worker is an employee when a common law employment relationship has been formed. Both definitions must be construed broadly to accomplish the purposes of the DWBR. The hiring entity bears the burden of establishing that the worker was an independent contractor rather than an employee. Duffey established a disputed fact as to whether Tender Heart exercised control over her wages and was therefore her employer.
COA, 1st Dist., Div. 5. Filed 1/11/19. 31 Cal.App.5th 232. Opinion by Justice Simons.
FURRY v. EAST BAY PUBLISHING
DEFENDANT EAST BAY DID NOT KEEP TRACK OF PLAINTIFF FURRY’S HOURS WORKED
Plaintiff Terry Furry sued his former employer East Bay Publishing for unpaid overtime, meal and rest break compensation, and inaccurate wage statements. Furry’s wage statements did not break down the hours he worked, his hourly rate, his overtime rate, or the amount of overtime worked. East Bay did not keep track of Furry’s hours. The case proceeded to a bench trial. The trial court concluded that East Bay failed to keep accurate records of Furry’s work hours but found Furry was not entitled to relief because his testimony regarding his work hours was too uncertain. Furry appealed, and the Court of appeal reversed.
AN EMPLOYEE’S TESTIMONY FROM MEMORY REGARDING HIS WORK HOURS IS SUFFICIENT WHERE THE EMPLOYER DOES NOT HAVE PRECISE RECORDS OF THE HOURS WORKED
Where an employer failed to keep accurate time records, the consequences of that failure should fall on the employer. Imprecise evidence from the employee can provide a sufficient basis for damages. The employee provides sufficient basis if he proves he has performed work for which he was improperly compensated and produces sufficient evidence of the amount and extent of that work via reasonable inference. The burden then shifts to the employer to produce evidence of the precise amount of work performed or evidence that negates the inferences to be drawn from the employee’s evidence. If the employer does not produce such evidence, the employee may be awarded damages even if they are approximated. Here, East Bay conceded start and end times for Furry’s typical workday that would have resulted in more than 8 hours worked per day and 40 hours per week. Several witnesses from East Bay confirmed Furry’s work schedule and that he sometimes worked evenings and weekends. Such evidence was sufficient to show that Furry performed work he was not paid. An employee’s estimates from memory are not a basis to deny relief. Furry’s estimates based on general workload and specific tasks and events were sufficient to shift the burden to East Bay to produce evidence of Furry’s precise hours worked. East Bay could not provide accurate work records, so Furry was entitled to damages for unpaid overtime.
CELA INVOLVEMENT
Congratulations to CELA member Tanya Gomerman of Law Office of Tanya Gomerman.
COA, 1st Dist., Div. 1. Filed 12/12/19, pub. ordered 1/4/19. Opinion by Justice Kelly.
LICUDINE v. CEDARS-SINAI MEDICAL CENTER
PLAINTIFF LICUDINE SERVED A 998 OFFER FIVE DAYS AFTER DEFENDANT CEDARS FILED ITS ANSWER
Plaintiff Dionne Licudine filed a medical malpractice case after surgery. Licudine sent Defendant Cedars a Code of Civil Procedure section 998 offer five days after it filed its answer. Cedars responded with an objection, stating that the offer was made too soon and that it had not yet had an opportunity to investigate Licudine’s claims. The 998 offer expired after 30 days. Licudine prevailed at trial, and the jury awarded her damages that far exceeded her 998 offer. Licudine sought prejudgment interest based on her 998 offer. The trial court concluded that Plaintiff Licudine’s 998 offer was not sent in good faith and denied her request for prejudgment interest. Licudine appealed, and the Court of Appeal affirmed.
A PREVAILING PLAINTIFF IS NOT ENTITLED TO PREJUDGMENT INTEREST FOR EXCEEDING HER 998 OFFER IF THAT OFFER WAS NOT MADE IN GOOD FAITH
A prevailing plaintiff is entitled to prejudgment interest from the date of her 998 offer, as long as the offer was valid and the verdict is more favorable than the rejected 998 offer. To be valid, the recipient of the 998 offer must have reasonable access to the facts necessary to intelligently evaluate the offer. The party making the 998 offer generally has the burden to show that the offer is valid. However, the recipient of the 998 has the burden of showing that an otherwise valid 998 offer was not made in good faith. Three factors are relevant in deciding whether the recipient had sufficient facts to evaluate the 998 offer: (1) how far into the litigation the 998 offer was made; (2) the information available to the recipient prior to the expiration of the 998 offer; and (3) whether the recipient of the 998 offer informed the sender that it lacked sufficient information, and how the sender responded. Because Licudine sent the 998 offer nineteen days after serving Cedars with the complaint and did not respond to Cedars’ concerns regarding its lack of information, the trial court did not abuse its discretion in concluding that Cedars did not have sufficient information to evaluate the reasonableness of the 998 offer.
COA, 2nd Dist., Div. 2. Filed 1/3/19, modified on denial of rehearing 1.24.19. Opinion by Justice Hoffstadt.
LINTON v. COUNTY OF CONTRA COSTA
PLAINTIFF LINTON ACCEPTED A CCP §998 OFFER IN AN UNRUH ACT AND DISABLED PERSONS ACT CASE
Plaintiff Linton, who uses a wheelchair, sued Defendant Contra Costa County when she alleged she was injured while riding a paratransit van operated by the county. She sued under California’s Unruh Act and Disabled Persons’ Act (“DPA”).
After years of litigation, Plaintiff Linton accepted a settlement offer pursuant to CCP §998 for $250,001, “[p]lus costs under Code of Civil Procedure §1032 and attorney’s fees allowed by law as determined by the court.”
THE TRIAL COURT DENIED THE ATTORNEY’S FEE APPLICATION
Plaintiff Linton subsequently filed an application for attorney’s fees with the trial court. The court denied the application, finding that, because there was no admission of a violation of either statute, there was no legal entitlement to attorney’s fees.
THE APPELLATE COURT RULED THAT THERE WAS NEITHER A STATUTORY NOR CONTRACTUAL BASIS FOR ATTORNEY’S FEES
The appellate court upheld the trial court’s ruling. Looking at the language of the Unruh Act and Disabled Persons’ Act, the court found that both required a finding of a violation of that act for an award of attorney’s fees.
Civil Code section 52, which provides for attorney’s fees under the Unruh Act, only allows them to a person “denied the rights under” that statute or other, similar ones. Likewise, the DPA allows attorney’s fees only against entities that “den[y] or interfere[] with admittance to or enjoyment of the public facilities as specified . . . or otherwise interfere[] with the rights of an individual with a disability . . . . “
Here, the 998 offer neither admitted nor denied any violation of either act. Without such an admission, the court said, attorney’s fees could not be awarded under the statute’s plain language.
Neither did the 998 offer create a separate right to attorney’s fees. Because it did not provide for attorney’s fees, but rather qualified the right to attorney’s fees to those “allowed by law,” there was no separate contractual basis under the 998 for attorney’s fees.
CONCLUSION
This is an important decision for CELA members to study. We operate extensively with statutes that include fee-shifting provisions. For example, FEHA provides for attorney’s fees for “the prevailing party” (although a prevailing defendant may only receive such an award for frivolous, unreasonable or groundless cases). Be very careful of 998 offers that allow attorney’s fees “as allowed by law,” but do not assign a prevailing party, deny liability, or state that neither party shall be deemed the prevailing party.
This case seems to run counter to the goal of CCP §998 to promote settlement. What defendant will issue a 998 if it must admit liability, and what plaintiff will now accept such an offer for an Unruh or DPA claim without such an admission? This case means we must all be careful as we negotiate these resolutions, and it may require a legislative fix.
COA, 1st Dist. Div. 1, Filed 1/23/19, Opinion by Justice Margulies.
RALL v. TRIBUNE 365 LLC., ET AL.
PLAINTIFF WAS A CARTOONIST AND BLOGGER FOR THE L.A. TIMES
Plaintiff Frederick Rall III is a well-known cartoonist and blogger. From 2009 – 2015, he drew cartoons for the LA Times, mostly with a political bent. Beginning in 2013, he also published blog posts in conjunction with his cartoons for the Times.
PLAINTIFF PUBLISHED A BLOG POST ABOUT AN INCIDENT WITH THE LAPD
In 2015, Plaintiff Rall submitted a cartoon and blog post about the LAPD’s enforcement of jaywalking laws, which the Times published. The blog post detailed what Rall described as his own arrest by the LAPD for jaywalking. In his blog post, Rall claimed to have crossed the street legally, but that nonetheless a motorcycle officer “zoomed over, threw me up against the wall, slapped on the cuffs, roughed me up and wrote me a ticket.” Rall claimed other misdeeds by the officer as well.
THE TIMES PUBLISHED A NOTE TO ITS READERS AND STATED THAT RALL’S WORK WOULD NOT APPEAR IN THE TIMES AGAIN
In July 2015, the Times published “A note to readers.” In that note, the Times stated that the veracity of Rall’s blog post had been called into question. It described records provided to the Times by the LAPD, including a recording of the incident described by Rall, Rall’s initial complaint about the incident to the LAPD, as well as other evidence that it considered. The Times concluded that there were “serious questions about the accuracy of [Rall’s] blog post,” and that based on that, Rall’s “future work would not appear in The Times.”
PLAINTIFF RALL SUED FOR WRONGFUL TERMINATION, AMONG OTHER CLAIMS. THE COURT GRANTED THE TIMES’ ANTI-SLAPP MOTION
Plaintiff Rall sued for wrongful termination and breach of contract, among other claims. Rall alleged that The Times’ refusal to publish his future works constituted a wrongful termination in retaliation for his having perturbed the LAPD and its officers. He also alleged a breach of his contract with The Times.
The Times filed an anti-SLAPP motion, which the trial court granted as to all causes of action.
PLAINTIFF RALL’S ALLEGATIONS AROSE FROM A PROTECTED ACTIVITY
Analysis of the anti-SLAPP statute, codified at Ca. Code Civ. Pro. §425.16, includes a two-prong burden-shifting scheme. The moving party (usually the defendant) must prove that the complaint “arises from” one of the activities protected and enumerated by the statute.
The appellate court agreed with the trial court that the entire thrust of the complaint was The Times’ refusal to continue to publish Plaintiff Rall’s work. This, the court determined, was a protected act under the federal and state constitutional rights to free speech. It was furthermore protected under the anti-SLAPP statute because the speech was about a matter of public interest: the integrity of the police department and the validity of a claim made publicly against it.
PLAINTIFF RALL DID NOT HAVE A PROBABILITY OF SUCCESS ON THE MERITS
In the second prong of the anti-SLAPP analysis, the plaintiff may nonetheless prevail if he or she can show a probability of success on the merits. Case law has refined this inquiry to be the same analysis as that made on summary judgment, so that the court remains with constitutional boundaries by not engaging in factual inquiries.
Here, Plaintiff Rall could not prevail because the alleged termination of which he complained was not based on any statutory or constitutional violation. Assuming Rall was an employee at all – a question which the court did not reach – he was presumptively at will, and he identified no public policy upon which his wrongful termination claim could be based. Moreover, he presented no evidence of a contract, either oral or written.
CONCLUSION
Not every wrongful termination violates public policy, and not every unfair act is illegal. Plaintiff’s attorneys must be careful when litigating these matters or risk exposing their clients to the attorney’s fees shifting provisions of the anti-SLAPP statute.
COA, 2nd Dist., Div. 8, Filed Jan. 17, 2019, Opinion by Justice Grimes.
RYMEL v. SAVE MART SUPERMARKETS, INC.
THE TRIAL COURT PROPERLY DENIED SAVE MART’S MOTION TO COMPEL ARBITRATION
Three plaintiffs sued Defendant Save Mart Supermarkets for Fair Employment and Housing Act (FEHA) violations following their workplace injuries. Save Mart moved to compel arbitration under the California Arbitration Act (CAA), Federal Arbitration Act (FAA), and the federal Labor Management Relations Act (LMRA). The plaintiffs were union members, and Save Mart argued that the collective bargaining agreement (CBA) covered the plaintiffs’ allegations. The trial court denied Save Mart’s motions to compel arbitration, and Save Mart appealed. The Court of Appeal affirmed.
THE WAIVER OF A JUDICIAL FORUM FOR STATUTORY CLAIMS MUST BE EXPLICIT
Since arbitration is conducted by consent, a party who has not agreed to arbitrate a claim generally may not be compelled to arbitrate it. In order to waive statutory rights, a CBA must be “clear and unmistakable” regarding the waiver. Save Mart’s CBA required arbitration of claims arising under the agreement but did not include an explicit, clear, and unmistakable waiver of the right to a judicial forum for statutory claims. For the arbitration provision in a CBA to apply to the FEHA, the CBA must describe the FEHA protections being waived, or, at a minimum, specify that FEHA claims are waived. In addition, a CBA cannot authorize violations of state law. None of the plaintiffs’ claims were preempted by the CBA.
CELA INVOLVEMENT
Congratulations to CELA member Mark Velez and Samantha Tanner of Velez Law Firm.
COA, 3rd Dist. Filed 12/31/19. Opinion by Justice Duarte.
SIRI v. SUTTER HOME WINERY, INC.
PLAINTIFF SIRI COMPLAINED THAT HER EMPLOYER WAS NOT PAYING ITS TAXES PROPERLY
Plaintiff Says Siri worked as an accountant for her employer, Defendant Sutter Home Winery, Inc., d/b/a Trinchero Family Estates (“TFE”). In the course of her employment, Plaintiff Siri alleged that she discovered that Defendant TFE was not paying sufficient state taxes. She alleged further that she reported this issue internally, as well as to the Board of Equalization.
PLAINTIFF ALLEGED THAT SHE WAS FIRED BECAUSE OF HER COMPLAINTS. DEFENDANT ALLEGED A PRIVILEGE
When Defendant TFE fired her, Plaintiff Siri alleged that she was fired because of her complaints, in violation of Ca. Lab. Code §1102.5.
In its summary judgment motion and again during appeal, Defendant TFE did not dispute the reason for termination. Rather, Defendant TFE argued that Plaintiff Siri had admitted previously that it needed TFE’s tax returns to prove her case, and since those returns were protected by the tax payer privilege, Siri could not make out even a prima facie case of wrongful termination.
The trial court agreed and granted summary judgment.
THE APPELLATE COURT REVERSED, FINDING THE RETURNS WERE NOT NEEDED FOR PLAINTIFF’S CASE
The appellate court reversed. At the trial court below, Plaintiff Siri had moved to compel production of the tax returns, and its motion was denied. That ruling was upheld in a previous, unpublished decision.
The appellate court rejected Defendant TFE’s argument that Plaintiff Siri admitted in the trial court that she needed the tax returns, and that they comprised “the crux” of her case. Although the implied tax return privilege protects not just the returns themselves but also the information gleaned from them, nothing about plaintiff’s case required disclosure of that information. The court found that plaintiff could testify that she told TFE and the Board of Equalization that TFE was not paying its taxes properly, that that would not implicate the privilege, and TFE had not demonstrated that it would.
CONCLUSION
Privileges are narrowly construed, and a case will be allowed to go forward if it can do so without violating such a privilege.
COA, 1st Dist. Div. 4, Filed 1/23/19, Opinion by Justice Pollak.
VASQUEZ v. SAN MIGUEL PRODUCE (EMPLOYER’S DEPOT, INC.)
PLAINTIFFS SUED ONLY THEIR ON-SITE EMPLOYER
Plaintiffs Vasquez and Zacarias worked for Defendant Employer’s Depot, Inc. (“EDI”), a staffing agency. EDI had an arbitration agreement with both plaintiffs, requiring them to arbitrate “all disputes that may arise within the employment context.”
Plaintiffs were sent to work for Defendant San Miguel Produce, and subsequently sued San Miguel for various Labor Code violations. San Miguel in turn cross-complained against EDI.
THE TRIAL COURT DENIED THE PETITION TO COMPEL ARBITRATION
EDI petitioned to compel arbitration. Plaintiffs opposed on the grounds that EDI was not named as a defendant in the complaint, and San Miguel was not a signatory to the arbitration agreement. The trial court denied the petition.
BOTH EDI AND SAN MIGUEL WERE ENTITLED TO ENFORCE THE ARBITRATION AGREEMENT
The appellate court reversed. It ruled first that Plaintiffs could not get around the arbitration agreement merely by failing to name EDI, because EDI would be deprived of the benefit of that agreement if it were, as here, brought into the lawsuit by other means.
The court also held that San Miguel could enforce the agreement, even as a nonsignatory, because it was EDI’s agent for the purpose of the alleged Labor Code violations and because it was Plaintiffs’ co-employer. Applying Dynamex Operations West, Inc., v. Sup. Ct., the appellate court found that both EDI and San Miguel had sufficient interaction with plaintiffs to be considered employers. Under Ca. Lab. Code §1194, the applicable Wage Order 8, and controlling case law, every employer is equally responsible for the prompt and correct payment of wages, as well as the timely taking of meal and rest breaks.
CONCLUSION
Both staffing agencies and on-site employers will normally be found liable for wage and hour violations under California law.
COA, 2nd Dist., Div. 6, Filed 1/30/19. Opinion by Justice Perren.
Ninth Circuit
CURTIS v. IRWIN INDUSTRIES, INC.
PLAINTIFF CURTIS SUED FOR ALLEGED OVERTIME VIOLATIONS
Plaintiff Curtis filed a wage-and-hour class action against his previous employer, Irwin Industries. Curtis worked on an offshore oil platform on the Outer Continental Shelf. He worked for a union pursuant to a collective bargaining agreement (“CBA”).
Plaintiff Curtis alleged that he worked 12 hours on, 12 hours off, but that during his 12 hours he was unable to leave the platform as a practical matter. He alleged, among other wage-and-hour claims not pertinent here, that he should have been overtime for those off-duty hours.
PLAINTIFF CURTIS RELIED ON PREVIOUS 9TH CIRCUIT PRECEDENT
Plaintiff Curtis argued that the 9th Circuit case of Gregory v. SCIE, LLC, supported his position that California overtime laws were not preempted by §301 of the LMRA. In Gregory the court held that, because California Labor Code §510 defined overtime under state law, it was necessary to interpret state law to resolve overtime issues, and therefore the claims were not preempted.
INTERVENING CASE LAW OVERRULED GREGORY
The Curtis court disagreed. Although the California Supreme Court had not passed on the matter, two California appellate cases subsequently did. The Curtis court stated that it should follow those two cases, Vranish v. Exxon Mobil Corp. and Flowers v. LA City MTA, in the absence of any evidence that the California Supreme Court would rule otherwise. The court said that both Vranish and Flowers, which were decided after Gregory, held that if a CBA satisfied the requirements of Ca. Lab. Code §514, which preempts overtime claims when a CBA provides premium wage rates for overtime, then any such claims would be preempted. The Curtis court went so far as to say that Gregory “was overruled by intervening California case law.”
CONCLUSION
Curtis will remain the rule in the 9th Circuit unless and until Vranish or Flowers is overturned by the California Supreme Court, or at least disagreed with by another California appellate court.
CELA INVOLVEMENT
Michael A. Strauss and Aris E. Karakalos of Strauss & Strauss in Ventura litigated this matter.
9th Circuit, filed 1/25/19, Opinion by Judge Ikuta.
IBRAHIM v. UNITED STATES DEPARTMENT OF HOMELAND SECURITY, et al.
PLAINTIFF RAHINAH WAS MISTAKENLY PLACED ON THE NO FLY LIST. HER ATTORNEYS MOVED FOR ATTORNEY FEES AFTER PREVAILING AT TRIAL
Plaintiff Dr. Rahinah Ibrahim was detained at the airport because her name was on the “No Fly” list. After Dr. Ibrahim was allowed on her international flight to Malaysia in 2005, the federal government refused to allow her to return to the United States. Dr. Ibrahim filed suit to challenge her placement on the No Fly List. After almost a decade of litigation, the federal government finally conceded that Dr. Ibrahim posed no threat and should not have been on the No Fly list. However, the federal government refused to allow her to return to the United States for trial, but her attorneys prevailed without her, showing that the government knew from the start that Dr. Ibrahim’s name on the No Fly list was a mistake. Dr. Ibrahim prevailed on her procedural due process claim, and the district court declined to decide the other four claims because no greater relief could be ordered. Dr. Ibrahim’s attorneys filed a motion for attorney fees pursuant to the Equal Access to Justice Act (“EAJA,” 28 U.S.C. §2412). The district court granted fees but reduced the requested fees by almost ninety percent due to lack of success on the four undecided claims. Dr. Ibrahim’s attorneys appealed, and the Ninth Circuit, en banc, reversed and remanded to the district court to recalculate the fees.
UNREACHED CLAIMS ARE NOT UNSUCCESSFUL. FULLY COMPENSATORY FEES SHOULD BE AWARDED WHERE SUCCESSFUL AND UNSUCCESSFUL CLAIMS AROSE FROM THE SAME COURSE OF CONDUCT
In complex civil rights litigation, plaintiffs often raise numerous alternative causes of action to achieve the same desired outcome. The rejection of, or failure to reach, certain claims is not a sufficient reason to reduce the attorney fee award. The result is what matters, and where a plaintiff achieves excellent results, her attorneys should receive a fully compensatory fee. Unreached claims may not be considered unsuccessful when assessing the fee. Hours may be excluded from the fee when spent on a claim that is distinct in all respects from the successful claims. Where the lawsuit consists of related claims, the fee award should not be reduced for lack of success on some claims. The focus is on whether the successful and unsuccessful claims arose out of the same course of conduct. If they did not, they are unrelated. Since all of Dr. Ibrahim’s claims arose from a common course of conduct, they were related. Though the fee award may still be reduced for limited success, Dr. Ibrahim’s success was not limited, so the award may not be so reduced.
9th Circuit, en banc. Filed 1/2/19. 912 F.3d. 1147. Opinion by Judge Wardlaw.