4/3 DCA Sides With First District in USS-Posco Decision On Retroactivity Issue.
On January 1, 2014, Labor Code section 218.5 was amended significantly, changing a reciprocal fee-shifting statute in an employment context to only vex a losing plaintiff bringing certain wage/hour cases in bad faith. The retroactive impact of this decision was squarely at issue in Antonov v. Farheap Solutions, Inc., Case No. G052275 (4th Dist., Div. 3 Oct. 11, 2016) (unpublished).
In this case, employee lost a wage/hour case such that the lower court granted a fee award to the employer defendant to the tune of $380,925 (although finding excessive the fee request of $634,875). It did so because the case was commenced before January 1, 2014 and the prior reciprocal statute was found applicable.
The fee award was reversed and remanded, because no bad faith determination was made with respect to losing plaintiff—in a 3-0 decision authored by Presiding Justice O’Leary.
Our local appellate court found that the section 218.5 amendment was indeed retroactive to pending cases, siding heavily with the reasoning of the First District in USS-Posco Industries v. Case, 244 Cal.App.4th 197 (2016) [discussed in our January 30, 2016 post]. We will report that the California Supreme Court denied review in USS-Posco on April 20, 2016. So, the fee recovery was remanded to determine if bad faith existed, although there is now a second decision agreeing that amended section 218.5 is retroactive in nature as far as fee awards against plaintiff employees.