Winning Alter Ego Targets’ Fee Award Of $82,500 Sustained On Appeal.
In Califco, LLC v. Kientz, Case No. B28004 (2d Dist., Div. 1 Sept. 28, 2017) (unpublished), two alter ego targets were found personally not liable with respect to contract and tort claims brought out of a failed restaurant situation involving a lease. The trial judge awarded the winning individuals $82,500 out of a requested $111,567.50 in attorney’s fees.
On appeal, the fee award adverse parties/appellants argued that the trial judge failed to apportion attorney’s fees among defendants. Although agreeing that apportionment of a fee award is mandatory, the lower court retains a wide degree of discretion on how to apportion the award. (Charton v. Harkey, 247 Cal.App.4th 730, 744 (2016) [discussed in our May 24, 2016 post].) The trial judge in Kientz decided that the work was “inextricably intertwined” and it was “impracticable/impossible to separate activities into compensable or noncompensable units.” Appellant challenged this by citing to cases where losing litigants obtained a reversal where the record clearly showed only a small portion of the work related to compensable time. However, those cases were distinguishable according to the appellate court, demonstrating that the factual circumstances of the case drive whether the lower court abused its discretion. It did not in this one, with the fee award affirmed.