Reconstructed Time Sheet Evidence Went Only to Weight, Not Admissibility Of Fee Submissions.
In Cates v. John Chiang, as State Controller, Case No. D060570 (4th Dist., Div. 1 Feb. 7, 2013) (published), plaintiff received $2,011,844 in fees under a private attorney general “catalyst theory” (lodestar at a blended hourly rate of $451 for 2,398 of attorney hours plus 1.85 multiplier), which was substantially less than her request ($3,073,912-$3,200,000) and much more than advocated by the defense (“no fees” at all). This followed on the heels of plaintiff successfully challenging the Gambling Control Commission’s failure to collect over $12 million in taxes from certain Indian tribes. After both defendants hit with fees, the State Controller and Gambling Control Commission, appealed.
Controller won a reversal, because the appellate court could not conclude plaintiff showed she was a catalyst as far as this defendant. However, she certainly showed she was a catalyst vis-a-vis the Commission; after all, it made further audits and collected $11.5 million of the over $12 million in tax “underbilling.” Plaintiff was not penalized for failing in attempts to make prelitigation settlement demands, because both defendants adamantly contended they did nothing wrong–the law does not require idle acts, in other words. (Civ. Code, § 3532, which was cited by the court.)
Well, that turned attention to the amount of fee awarded to plaintiff as against defendant Commission. Fee expert Gerry Knapton seemed to do a good job for plaintiff and was credited at least partially by the lower court in setting the lodestar with a 15% reduction in all time by two attorneys. On appeal, the defense challenged the fact that some of the fee substantiation was reconstructed time, but found this went to the weight rather than admissibility of the evidence–with Mr. Knapton indicating that this likely led to underbilling rather than overbilling. Although finding the 1.85 multiplier deserving on the actual lodestar, the appellate court found multipliers are rarely deserved for “fees on fees” services relating to the amount of fees to be awarded, given that the risk of not obtaining fees is essentially eliminated once fee entitlement is found. So, the fee award against the Commission was affirmed, but with the lower court needing to strike time spent on litigating the amount of fees which should be awarded to plaintiff.