Case Number: BC475897??? Hearing Date: April 25, 2016??? Dept: 78
Superior Court of California
County of Los Angeles
Department 78
QUINCY MILES;
Plaintiff,
vs.
CITY OF LONG BEACH;
Defendant. Case No.: BC 475897
Hearing Date: April 25, 2016
[TENTATIVE] RULING RE:PLAINTIFF QUINCY MILES? MOTION TO STRIKE DEFENDANT?S MEMORANDUM OF COSTS.
Plaintiff Quincy Miles? Motion to Strike Defendant?s Memorandum of Costs is GRANTED in part. The court finds that Miles has the ability to pay some expert costs of the City of Long Beach for the expert fees of David Weiner, and orders payment of $3,000 in costs, payable to City of Long Beach?s counsel within 60 days of this ruling. The court strikes the remaining costs sought by Defendant.
BACKGROUND
This is an employment discrimination case. The original complaint in this case was filed on December 27, 2011. Miles filed his Second Amended Complaint on April 25, 2012, alleging the following four causes of action:
1. Race Discrimination
2. Retaliation
3. Hostile Work Environment
4. Failure to Prevent Discrimination, Harassment, Retaliation
Trial began on September 22, 2015. During the trial, the court granted nonsuit on Miles? race discrimination claim. On October 29, 2015, the jury returned a verdict for Defendant City of Long Beach (?COLB?) on the remaining causes of action. On December 3, 2015, judgment was entered in favor of COLB.
The COLB served its Memorandum of Costs by mail on Plaintiff Quincy Miles (?Miles?) on December 21, 2015. Miles filed its Motion to Strike the Memorandum of Costs on January 5, 2016. COLB filed its Opposition on February 16, 2016. Miles filed his Reply on March 4, 2016.
At the original hearing on this motion, the court continued the motion to allow for supplemental briefing on the following issues:
1. Whether COLB?s 998 offer was made in good faith;
2. Which witnesses testified as expert witnesses, as opposed to percipient witnesses. For example, the court notes as one example, that several witnesses testified as to whether Sergeant Blair made a racial slur about Miles, and did not render expert opinions. Other witnesses listed as experts by COLB only testified as to their observations of actions taken by Miles. While Code of Civil Procedure section 998, subdivision (f) provides that ?[p]olice officers shall be deemed to be expert witnesses for the purposes of this section,? the court finds that this does not mean that COLB is entitled to recover expert witness fees for percipient testimony by a police officer.
3. If the court finds that the 998 offer was made in good faith and there are recoverable expert witness costs, to what extent should the court exercise its discretion to ?scale? the total expert witness costs pursuant to the factors addressed in Holman. The court notes, for example, that Miles received a fee waiver and testified as to his indigence at the time of trial.
Miles and COLB filed their supplemental briefs on April 8, 2016.
DISCUSSION
I. MOTION TO STRIKE MEMORANDUM OF COSTS
The following discussion is taken from the court?s March 18, 2016 Ruling.
?Any notice of motion to strike or to tax costs must be served and filed 15 days after service of the cost memorandum. If the cost memorandum was served by mail, the period is extended as provided in Code of Civil Procedure section 1013. If the cost memorandum was served electronically, the period is extended as provided in Code of Civil Procedure section 1010.6(a)(4).? (California Rules of Court Rule 3.1700, subd. (b)(1).) Because the Memorandum of Costs was served by mail on December 21, 2015, this Motion to Strike is timely.
?Code of Civil Procedure section 1032, subdivision (b) [], guarantees prevailing parties in civil litigation awards of the costs expended in the litigation: ?Except as otherwise expressly provided by statute, a prevailing party is entitled as a matter of right to recover costs in any action or proceeding.?? (Williams v. Chino Valley Independent Fire Dist. (?Williams?) (2015) 61 Cal.4th 97, 100.)
The court in Williams also addressed the fee shifting provision in FEHA, holding: ?Government Code section 12965, subdivision (b) [], provides for private actions to enforce the provisions of FEHA. It states in part: ?In civil actions brought under this section, the court, in its discretion, may award to the prevailing party, including the department, reasonable attorney’s fees and costs, including expert witness fees.?? (Williams, supra, 61 Cal.4th at p. 101.)
The California courts, in addressing awards of attorneys? fees under FEHA, have applied the standard for when a prevailing party should be awarded fees under the U.S. Supreme Court holding in Christianburg Garment Co. v. EEOC (?Christianburg?)(1978) 434 U.S. 412. (See Cummings v. Benco Building Services (?Cummings?) (1992) 11 Cal.App.4th 1383, 1387.) As the court held in Cummings that under Christianburg, ??a prevailing plaintiff ? ‘should ordinarily recover an attorney fee unless special circumstances would render such an award unjust.’? [Citation.]? (Ibid.) However, ?the court [in Christianburg] found the standard for awarding prevailing defendants attorney fees and costs should be entirely different. The standard ultimately adopted by the court, and supported by the legislative history, directed ?such awards should be permitted ‘not routinely, not simply because he succeeds, but only where the action brought is found to be unreasonable, frivolous, meritless or vexatious.’ [Citation.]? (Ibid.)
The California Supreme Court recently addressed the question of recovery of costs in a FEHA case. The Court found that FEHA?s provision for recovery of fees and costs ?is an express exception to Code of Civil Procedure section 1032(b) and the former, rather than the latter, therefore governs costs awards in FEHA cases.? (Williams, supra, 61 Cal.4th at p. 105.) The Court concluded that ?the Christiansburg standard applies to discretionary awards of both attorney fees and costs to prevailing FEHA parties under Government Code section 12965(b).
To reiterate, under that standard a prevailing plaintiff should ordinarily receive his or her costs and attorney fees unless special circumstances would render such an award unjust [Citation.] A prevailing defendant, however, should not be awarded fees and costs unless the court finds the action was objectively without foundation when brought, or the plaintiff continued to litigate after it clearly became so.? (Id. at p. 115.)
The court in Cummings set forth the standard for determining when an action is ?frivolous, meritless or vexations.? The court held: ??[T]he term ?meritless? is to be understood as meaning groundless or without foundation, rather than simply that the plaintiff has ultimately lost his case, and that the term ?vexatious? in no way implies that the plaintiff’s subjective bad faith is a necessary prerequisite to a fee award against him. In sum, a district court may in its discretion award attorney’s fees to a prevailing defendant in a Title VII case upon a finding that the plaintiff’s action was frivolous, unreasonable, or without foundation, even though not brought in subjective bad faith.? [Citation.]? (Cummings, supra, 11 Cal.App.4th at p. 1387.)
The court in Cummings held further:
?In applying these criteria, it is important that a district court resist the understandable temptation to engage in post hoc reasoning by concluding that, because a plaintiff did not ultimately prevail, his action must have been unreasonable or without foundation. This kind of hindsight logic could discourage all but the most airtight claims, for seldom can a prospective plaintiff be sure of ultimate success. No matter how honest one’s belief that he has been the victim of discrimination, no matter how meritorious one’s claim may appear at the outset, the course of litigation is rarely predictable. Decisive facts may not emerge until discovery or trial. The law may change or clarify in the midst of litigation. Even when the law or the facts appear questionable or unfavorable at the outset, a party may have an entirely reasonable ground for bringing suit.?
(Cummings, supra, 11 Cal.App.4th at p. 1388.)
However, courts also recognize that ?[m]eritless lawsuits clog court dockets, delaying the resolution of meritorious suits and diverting judicial resources that could be devoted to worthwhile litigation. Courts exist to settle disputes, not to settle scores. Suits filed with no real hope of victory needlessly bring defendants through the costly and agonizing uncertainty of defending suit.? (Del Rio v. Jetton (1997) 55 Cal.App.4th 30, 35.) Courts have affirmed awards of attorneys? fees for prevailing defendants where the plaintiff ?never had or even claimed to have any evidence that race discrimination played a role in his termination other than his own opinion.? (Robert v. Stanford University (2014) 224 Cal.App.4th 67, 73.)
As an initial matter, the court notes that this case survived a Motion for Summary Judgment and proceeded to a lengthy trial. The court finds that this case was therefore not a ?meritless? lawsuit to which the City would be entitled to costs under Williams and Cummings.
However, on August 17, 2015, the City made a Statutory Offer to compromise to Miles in the amount of $10,000. ?The costs allowed under Sections 1031 and 1032 shall be withheld or augmented as provided in this section.? (Code Civ. Proc., ? 998, subd. (a).) Section 998 subdivision (c)(1) provides that:
If an offer made by a defendant is not accepted and the plaintiff fails to obtain a more favorable judgment or award, the plaintiff shall not recover his or her postoffer costs and shall pay the defendant’s costs from the time of the offer. In addition, in any action or proceeding other than an eminent domain action, the court or arbitrator, in its discretion, may require the plaintiff to pay a reasonable sum to cover postoffer costs of the services of expert witnesses, who are not regular employees of any party, actually incurred and reasonably necessary in either, or both, preparation for trial or arbitration, or during trial or arbitration, of the case by the defendant.
The City argues that it is seeking only those costs specifically authorized under section 998, and not costs authorized under FEHA. (Opposition at pp. 3?4.) Miles counters in his Reply brief that section 998 costs are still not allowed absent a showing that the FEHA-based action was ?meritless? under Williams, and, in the alternative, that the City?s 998 offer was not in good faith. (Reply at pp. 2?5.) Miles also argues that the City cannot recover costs for percipient witnesses or non-retained witnesses. (Reply at pp. 5?6.)
A. SECTION 998 COSTS BY DEFENDANTS IN FEHA ACTIONS
The court in Holman v. Altana Pharma US, Inc. (?Holman?) (2010) 186 Cal.App.4th 262, 281 held that there is nothing in FEHA that ?expressly disallows an award of expert witness fees to a prevailing FEHA defendant under Code of Civil Procedure section 998.? Additionally, the Court of Appeal found that ?there is nothing in section 12965 that expressly disallows an award of expert witness fees to a prevailing FEHA defendant unless the Christiansburg standard is met.
Thus, even if the Christiansburg standard implicitly applies when prevailing defendants seek to recover expert witness fees under section 12965, we conclude that the trial court was authorized to exercise its discretion under Code of Civil Procedure section 998 to award expert witness fees here.? (Holman, supra, 186 Cal.App.4th at pp. 281?282.)
Miles is correct that ?ordinary litigation costs? under sections 1032 and 1033.5 are subject to the Christianburg standard pursuant to Williams, which was decided after Holman. Miles therefore argues that section 998 costs are similarly subject to the Christianburg standard because they only ?augment? costs allowed under section 1031 and 1032. (Reply at p. 2.) Williams, however, did not overturn the holding in Holman that expert witness fees allowable under section 998 are recoverable in FEHA actions by prevailing defendants without meeting the Christianburg standard.
Williams cites Holman, summarizing its holding as follows: ?where [a] trial court has discretion under both Gov.Code, ? 12965(b) and Code Civ. Proc., ? 998, subd. (c)(1) to award [a] prevailing defendant its expert witness fees, [the] court in determining [the] size of award should consider the policies behind both statutes, including the policy of encouraging vindication of civil rights embodied in the Christiansburg standard.? (See Williams, supra, 61 Cal.4th at p. 108.) The court also cited Holman as holding that expert witness fees awarded to a prevailing FEHA defendant should ?be ?scaled? to the parties’ relative financial resources.? (Id. at p. 114.) Notably, Williams expressly overturned the holdings of several cases, but declined to overrule Holman. (Williams, supra, 61 Cal.4th at p. 115.)
Therefore, the holding in Holman remains good law that a prevailing defendant in a FEHA case need not satisfy the Christianburg standard to recover the additional costs allowable pursuant to section 998. However, an award of expert witness fees to a prevailing FEHA defendant is still subject the discretion of the court to ?not only look to whether the expense was reasonably incurred, but [] also [to] consider the economic resources of the offeree.? (Holman, supra, 186 Cal.App.4th at p. 284.) ??Thus, when two competing parties possess vastly disparate economic resources, this may require the trial courts to ?scale? the financial incentives . . . to the parties’ respective resources.? [Citation.] We believe that this result is both ?in keeping with the policy set forth in Christiansburg regarding the unequal treatment of prevailing defendants and prevailing plaintiffs in a discrimination suit? [Citation], the legislative policy reflected in section 12965, and the policy of Code of Civil Procedure section 998 that parties rejecting offers of litigation settlement must face economic consequences if they miscalculate and lose.? (Ibid.)
The court notes that COLB makes additional arguments in its supplemental brief that if a 998 offer is made in a FEHA case, all costs are recoverable regardless of the holding in Williams. (COLB Supp. Brief at pp. 8?9.) The court did not request supplemental briefing on this issue. COLB argues that because section 998 is an entirely independent basis for an award of costs, Williams does not apply to any costs sought pursuant to section 998, even if they are not recoverable under Section 1032. However, Section 998 provides that ?costs allowed under Sections 1031 and 1032 shall be withheld or augmented as provided in this section.? Therefore, section 998 is not entirely independent of section 1032, and only the additional costs allowable under section 998 as ?augmenting? 1032 are not subject to the Christianburg standard pursuant to Williams. The Motion to Strike Costs as to all non-expert costs is GRANTED.
B. GOOD FAITH OF 998 OFFER
?Section 998 achieves its aim by punishing a party who fails to accept a reasonable offer from the other party. . . . Whether a section 998 offer is reasonable must be determined by looking at circumstances when the offer was made. [Citations.] However, the reasonableness of an offer depends upon the information used to evaluate it. . . . As a general rule, the reasonableness of a defendant’s offer is measured, first, by determining whether the offer represents a reasonable prediction of the amount of money, if any, defendant would have to pay plaintiff following a trial, discounted by an appropriate factor for receipt of money by plaintiff before trial, all premised upon information that was known or reasonably should have been known to the defendant. . . . If the offer is found reasonable by the first test, it must then satisfy a second test: whether defendant’s information was known or reasonably should have been known to plaintiff.? (Elrod v. Oregon Cummins Diesel, Inc. (1987) 195 Cal.App.3d 692, 699.) ?Where . . . the offeror obtains a judgment more favorable than its offer, the judgment constitutes prima facie evidence showing the offer was reasonable and the offeror is eligible for costs as specified in section 998. The burden is therefore properly on plaintiff, as offeree, to prove otherwise.? (Id. at p. 700.)
COLB offered Miles $10,000 to settle this case after the denial of its motion for summary judgment and a Mandatory Settlement Conference. COLB obtained a judgment more favorable than its offer. Therefore, the burden is on Miles to show that this offer was unreasonable.
One of the challenges in this case is that an offer of $10,000 is very low, and could be argued to be ?a token or nominal offer. As the court held Wear v. Calderon (1981) 121 Cal.App.3d 818, 821, ?a token or nominal offer will not satisfy this good faith requirement.? While the $10,000 offer was low, the court finds on the unique facts of this case that Miles has not met his burden to show that this offer was unreasonable.
Miles argues first that the $10,000 offer was unreasonable because the case was in unlimited jurisdiction, and therefore damages were likely to exceed $25,000. (Miles Supp. Brief at p. 2.) However, the fact that this case was in unlimited jurisdiction is not a reasonable predictor of the value of the case. Miles then argues that he successfully opposed the motion for summary judgment. However, the court notes that while the motion was summary judgment was denied in its entirety, COLB did not seek summary adjudication of any of the issues therein. COLB asserts that the court that heard the summary judgment motion advised that it was inclined to grant summary adjudication on all but the harassment cause of action but denied the motion because of the procedural technicality that COLB did not move for summary adjudication. (Jenkins Decl. P 2.) While Ms. Jenkins does not attach a transcript of the hearing, this is the court?s understanding of the summary judgment ruling, i.e., that the failure to move for summary adjudication prevented the judge from granting any relief on the motion. To the extent it appeared to the COLB that Miles? claims would likely be limited to recovery on only the harassment claim, a low offer of settlement is reasonable.
Miles also argues that the jury verdict was not unanimous. (Id. at pp. 2?3.) However, a unanimous jury verdict is not required to make a prior offer reasonable.
Finally, the court notes that because this case had already had a motion for summary judgment and an MSC, the issues and evidence were well developed and both parties had equal knowledge of the underlying case.
At trial, COLB obtained a non-suit as to the cause of action for discrimination, and the claim proceeded principally on a harassment cause of action. COLB also points out that the 998 offer was made before it knew that Miles would claim that Sergeant Blair referred to him using a racial slur, a claim that was not made prior to the commencement of trial. (Jenkins Decl. ? 7.) The settlement offer was therefore made before COLB knew of a key piece of evidence relied on by Miles at trial.
For the above reasons, the court finds that the 998 offer was made in good faith and was reasonable.
C. EXPERT TESTIMONY OF POLICE OFFICERS
Having found that COLB made a good faith 998 offer, COLB would be entitled to the expert witness fees it incurred after the offer was rejected.
Section 998 subdivision (f) provides that ?Police officers shall be deemed to be expert witnesses for the purposes of this section.? COLB argues that this provision means that all of the police officers who testified at trial are per se experts whose costs can be recovered under section 998.
However, COLB reads this section too broadly. ??Opinion testimony may be admitted in circumstances where it will assist the jury to understand the evidence or a concept beyond common experience. Thus, expert opinion is admissible if it is ?[r]elated to a subject that is sufficiently beyond common experience [and] would assist the trier of fact.? (Evid.Code, ? 801, subd. (a).) Expert opinion is not admissible if it consists of inferences and conclusions which can be drawn as easily and intelligently by the trier of fact as by the witness. [Citation.]? [Citation.] Whether an expert should be permitted to opine on a particular subject is consigned to the trial court’s discretion.? (People v. Singleton (2010) 182 Cal.App.4th 1, 20?21.)
Although section 998 deems police officers as expert witnesses for the purposes of the section, section 998 provides costs only for ?expert witnesses, who are not regular employees of any party, actually incurred and reasonably necessary in either, or both, preparation for trial or arbitration, or during trial or arbitration, of the case by the defendant.? (Code Civ. Proc., ? 998, subd. (c)(1).) Therefore, COLB faces two limitations on its recovery of expert witness fees for testimony by its police officers ? (1) Section 998 is limited to expert witnesses ?who are not regular employees? of the COLB and (2) recovery is limited to police officers who provided expert testimony, and not those who only testified as percipient witnesses.
Because most of the officers who testified for COLB were regular employees of COLB, the fact that they are also police officers does not make their time recoverable under Section 998. COLB cites to no case law finding that any witness who is a police officer in a trial, regardless of whether they are a regular employee of a party, would be entitled to costs for a prevailing defendant under section 998. Rather, the court finds that COLB cannot recover expert witness fees for the police officers in its Memorandum of Costs who were employed by COLB at the time of trial.
Second, the court is not aware of any individuals listed in the COLB Memorandum of Costs who were not employed by COLB, and presented expert testimony ? other than forensic economist David Weiner. COLB does not present any argument that any of its witnesses presented expert, as opposed to percipient testimony. Rather, COLB asserts that all police officers who prepared for trial or testified are automatically entitled to be compensated for their time as ?experts.? Further, Miles does list the testimony of the witnesses, which summaries appear to support his argument that the witnesses mostly provided percipient, and not expert testimony.
Absent a showing by COLB that any of its witnesses who testified as police officers were (1) not employees of the COLB at the time of testimony and (2) presented expert, as opposed to percipient testimony, the court grants the motion to strike the costs of all these witnesses.
This leaves only the request for expert fees for witness David Weiner (?Weiner?). COLB seeks 24.63 hours at $375 per hour for Weiner?s testimony. Miles argues that the costs associated with Weiner should be reduced to his testimony, which was under 30 minutes. (Miles Supp. Brief at p. 6.) Miles also argues that Weiner was never deposed nor did he produce any expert reports.
COLB does not mention Weiner in its supplemental brief. However, the court finds that COLB would be entitled to an amount of time to prepare for and present his testimony. At trial, Weiner testified that he reviewed Miles? employment records, MOUs of Long Beach and the Police Department, 2 volumes of Miles? deposition transcripts, discovery responses, and governmental data regarding present value to reach his opinion regarding Miles? potential lost earnings. Therefore Weiner clearly incurred expert witness fees for the time in preparation for his trial testimony. Moreover, in its Memorandum of Costs, counsel for COLB states that the costs set forth in the Memorandum of Costs ?were necessarily incurred in this case.? Accordingly, the court accepts this representation that COLB actually paid Weiner expert fees in the amount of $9,236.25 for 24.63 hours of work. The court finds further that given the necessary review and analysis by expert Weiner to calculate Miles? lost earnings, spending approximately 20 hours to prepare for his testimony, plus 4.63 hours to present his testimony (including actual testimony time, waiting time, meeting with the attorneys, and any travel time) is a reasonable amount of time for an expert to prepare for and provide testimony in this type of FEHA case.
SCALING
COLB argues that it is a municipality that is not a for-profit corporation, and that any funds spent on this case must be diverted from other public needs and services. (See COLB Memorandum, at pp. 7-8.) Miles points out that at the time of trial he was homeless and indigent, and that it would therefore be inequitable to require him to pay costs in this case.
The court finds that some ?scaling? is appropriate here. As the court held in Holman: ?Thus, when two competing parties possess vastly disparate economic resources, this may require the trial courts to ?scale? the financial incentives (in this instance the [Code of Civ. Proc., ?] 998 cost awards) to the parties’ respective resources.? (Holman v. Altana Pharma US, Inc. (2010) 186 Cal.App.4th 262, 284, citing to Seever v. Copley Press, Inc. (2006) 141 Cal.App.4th 1550, 1562, as modified (Aug. 22, 2006).)
The court in Holman added: ?The court [in Seever] recognized that Code of Civil Procedure section 998 was designed to create economic incentives on both parties to settle rather than try their lawsuits, and that to further that goal, both sides must face some economic consequences if it turns out they miscalculate and lose. ?But consistent with the rationale of Christiansburg and like California decisions, it is entirely appropriate and indeed necessary for trial courts to ?scale? those awards downward to a figure that will not unduly pressure modest-or low-income plaintiffs into accepting unreasonable offers.? [Citation.]? (Holman, supra, 186 Cal.App.4th at pp. 283-84.)
The court finds that an award of $9,236.25 would constitute an unreasonable amount of costs to impose on Miles given his low-income status. However, while Miles testified at trial that he was homeless, he also testified that he had been employed by a range of security firms, and therefore was not wholly without resources. The evidence presented in court included financial information showing earnings by Miles in the years preceding the trial. Miles has not presented any evidence of his current financial situation, but the court assumes that at the present time he can continue to be employed as a security guard, although the court recognizes that he may not be able to obtain full-time work and that he has child support responsibilities.
The courts in both Holman and Seever talk about ?scaling? the expert costs award to reflect the parties? respective resources, not entirely deleting the liability of the plaintiff who rejects a 998 offer then does not prevail at trial. The court finds that Miles has the ability to pay some costs of the COLB, and orders payment of $3,000 in costs, payable within 60 days of this ruling.
Plaintiff to give notice.
DATED: April 25, 2016
________________________________
Hon. Gail Ruderman Feuer
Judge of the Superior Court