POOF!, Special Fee Shifting Statutes: Where Appellate Court Reversed CDAFA Jury Verdict Against Two Defendants, Prevailing Party Fees To Plaintiff Went POOF! On Appeal

Lower Court’s Denial Of Fees To A Prevailing Defendant Had To Be Reassessed Under The Court’s Earlier Hay Opinion Relating to Prevailing Defense CDAFA Fee Recovery

Penal Code section 502(e)(2) of California’s Comprehensive Computer Data Access and Fraud Act (CDAFA) allows a trial court to discretionarily award attorney’s fees, although there is no prevailing party language.  In Hay v. Marinkovich, 108 Cal.App.5^th 707,713, 726-727 (2025) [see our February 10, 2025 post],  the 4/1 DCA decided that prevailing defendants can be awarded fees under CDAFA, but only if the defendant can demonstrate that the plaintiff’s claim was objectively without foundation when brought or the plaintiff continued to litigate the claim after it clearly became so.  That is the backdrop for what occurred in Sillman v. Newnham, Case Nos. D083732 et al. (4^th Dist., Div. 1 Sept. 4, 2026) (unpublished).

Two defendants were found guilty of violating CDAFA, with a jury awarding plaintiff $1 against one defendant and $40,000 against another defendant.  A third defendant was exonerated because she accessed emails under a CDAFA exception applicable to persons acting within the scope of employment as a bookkeeper and controller.  Because cases with fee-shifting provisions get down to attorney’s fees, the lower court awarded plaintiff $93,808 against the two non-prevailing defendants (out of a requested $375,231), but it also denied the winning third defendant’s request for $129,956 in fees because it did not find plaintiff’s action to be fraudulent/abusive in nature.  All defendants appealed.

All defendants won, some bigger than others.  The appellate court determined that the jury verdict against the losing two defendants was not supported by the evidence, so the fees awarded against them went POOF!  As to the third, prevailing defendant, the 4/1 DCA remanded to reconsider the fee denial based on its Hay determination which was not available to the lower court when it denied fees (notwithstanding the lower court’s determination that the action was not frivolous).