Chavez v. City of LA was argued before the Cal. Supreme Court in San Francisco on Nov. 4, 2009. My source tells me that it appeared to go well for the City of LA. The issue in the case is whether Cal. Code of Civil Procedure sec. 1033 applies to Fair Employment and Housing Act (“FEHA”) lawsuits. Sec. 1033 allows a judge to deny or reduce an attorney fee award to a prevailing plaintiff who would otherwise be entitled to such an award under a contract or statute. The circumstance under which a judge would have such discretion is when the plaintiff recovers less (exclusive of the attorney fees) than the monetary threshold of the jurisdictional classification in which he or she sued. For example, if the plaintiff sued in Unlimited Civil (> $25,000) but received a damage award of only $10,000, he or she could be denied an attorney fee recovery. In Chavez, the plaintiff was awarded damages of $11,500 but was requesting fees of $880,000. Last year, the Court of Appeal reversed the trial court and held that 1033 did not apply to FEHA, thus facilitating the plaintiff’s attorney fee recovery. The Court essentially reasoned that the public policies behind FEHA trumped 1033. The City of LA petitioned the Supreme Court for review and the Court granted review. I believe this to be a “sleeper” case with deceptive importance. The Court of Appeal’s opinion would seem to apply to nearly all statutes providing prevailing plaintiff attorney fees. As many defendants know, the cost of litigation is often used more than the merits of a claim to coerce a monetary settlement. Therefore, small value cases are typically filed in the most expensive jurisdiction. As it is, the statute has been under-utilized by defendants. Sec. 1033 is one of the few tools left to defendants of abusive litigation. Therefore, I wrote a “friends of the Court” (“amicus”) brief on behalf of the Food & Beverage Association of San Diego County in Support of the City of LA. The Supreme Court will issue its decision within 90 days 0f November 4.
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