Prevailing Party, Section 1717: Where Defendant Obtained Injunctive Relief Against Plaintiff In Nonsolicitation Restriction Litigation, Section 1717 Fees And Costs Were Justified

$596,114 In Fees And $84,125 In Costs Affirmed On Appeal.

            In Blue Mountain Enterprises, LLC v. Owen, Case Nos. A157054/A158783 (1st Dist., Div. 1 Jan. 28, 2022) (published), plaintiff obtained a TRO, preliminary injunction, and permanent injunction in hard-fought litigation against a defendant who transferred his ownership interest in real estate/construction related business to plaintiff, but was found to have breached nonsolicitation restrictions in two agreements (one of which had a fees clause) by establishing a competing construction services company after being terminated as an employee by plaintiff.  The trial judge awarded prevailing party fees to plaintiff, under the contractual fees clause, in the amount of $596,114 as well as costs of $84,125.  The defense appeal was unsuccessful.

            Plaintiff did achieve one of its primary litigation objectives by obtaining injunctive relief against defendant, even though no monetary relief was obtained.  Defendant ran up fees after the grant of the preliminary injunction, so plaintiff had no choice but to litigate through the permanent injunction stage.  With respect to the amount of fees awarded, the trial judge looked at every single billing entry to make sure an award was justified and did make a major “haircut” from the requested fees.

            BLOG HAT TIP—Co-contributor Mike notes that the successful attorneys on appeal were Joshua R. Mandell and Haley C. Greenberg of Akerman.  Mike has had the opportunity to litigate against and work with Mr. Mandell, who is a consummate professional (along with Ms. Greenberg).  Also, the appellate court did rely on Strategix, Ltd. v. Infocrossing West, Inc., 142 Cal.App.4th 1068 (2006), a nonsolicitation decision in which co-contributor Mike was lead counsel on appeal, in coming to its result on the merits.  Good job, Josh and Haley! 

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