Demonstrative Evidence and Computer Related Expenses Were Properly Allowed As Routine Costs.
The next case is one that will remind practicing litigators to make sure they properly authenticate fee submissions in support of attorney’s fees request. The decision also has a nice discussion of some routine cost items that are recoverable in this age of demonstrative evidence (including computer assistive devices).
Gullwing International Motors, Ltd. v. Ostermeier, Case No. B206441 (2d Dist., Div. 2 Sept. 17, 2009) (unpublished) had its inception when
plaintiff buyer bought a Mercedes Benz Gullwing building replica business from defendant seller based on seller’s exact words to buyer: “Trust me. This is a gold mine.” As reported in the decision and apparently accepted by a jury, the business was apparently no gold mine. The jury awarded plaintiff $17.178 million in compensatory damages and $1 million in punitive damages in buyer’s subsequent fraud lawsuit. Later in the litigation, the trial court awarded plaintiff $34,742.66 of requested $60,742.89 in routine costs, as well as $457,615.25 in attorney’s fees. [Chromolithograph: Miner in the Klondike 1890-1900. Library of Congress Collection].
Plaintiff appealed.
The judgment was affirmed except for the appellate court’s modification to delete $141,283.75 from the fee award.
Justice Ashmann-Gerst, writing on behalf of a 3-0 panel, initially sustained awarding as routine costs the following items: easel; computer design; art direction; computer technicians; projector rental expense; blowups not used at trial. (Science Applications Internat. Corp. v. Superior Court, 39 Cal.App.4th 1095, 1104-1105 (1995); El Dorado Meat Co. v. Yosemite Meat & Locker Service, Inc., 150 Cal.App.4th 612, 619 (2007); Benach v. County of Los Angeles, 149 Cal.App.4th 836, 856 (2007).)
Attention then focused on the fee award. Here, plaintiff’s attorneys filed two attorney declarations attaching all bills, including bills from predecessor attorneys at different firms, and vouching they were in order and they had all been paid. Plaintiff moved for $ 1,162,532.93 in fees and disbursements, but trimmed it down to $497,165.35 when defendant challenged the reasonableness (based mainly on excising work for a prior federal case, so that fees were presented for work in the state case only). However, defendant also objected that plaintiff did not properly authenticate the work of prior attorneys on the case. The trial court awarded $457,615.25 in fees, and defendant challenged this ruling on appeal.
Defendant was partially successful. The appellate panel did find the attorney declarations to be inadequate because the current attorneys had no personal knowledge of prior counsel’s bills. A belief that “they were in order” was not the equivalent of competent evidence. Also, no one offered testimony regarding the number of hours worked, services rendered, he reasonableness of those services, and the like, and the declarants could not offer testimony regarding the preparation of bills from different offices. The declaration about paying prior bills did not lay a proper foundation for or properly authenticate the bills. These deficiencies resulted in slicing the fee award down to $316,331.50.
BLOG UNDERVIEW—We have done a number of fees awards involving bills from predecessor counsel. We always have obtained a declaration from prior counsel describing qualifications, nature of work provided, the billings sent to the client, reasonableness of the billings, and reasonableness of hourly rates. The billings from prior counsel are also attached, redacting out any sensitive or privileged matters—but not redacted so much that they fail to provide material information to the opponent and to the court reviewing the fee request. (After all, see our post of June 30, 2008 where we did review some cases—Gregg I and Gregg II out of the Fourth District, Division 1–where supplemental information had to be provided when initial fee submissions were too heavily redacted, not to mention a couple of trips before a Court of Appeal to get the right type of fee substantiation before the trial court.)