On 10/25/2017 SKYLIGHT ADVISORS LLC filed a Contract - Other Contract lawsuit against ZEPHYR INVESTMENT COMPANY LLC. This case was filed in Los Angeles County Superior Courts, Burbank Courthouse located in Los Angeles, California. The Judges overseeing this case are LAURA A. MATZ, OTHER DISTRICT JUDGE, C. EDWARD SIMPSON, CURTIS A. KIN and WILLIAM D. STEWART. The case status is Pending - Other Pending.
Pending - Other Pending
Los Angeles County Superior Courts
Los Angeles, California
LAURA A. MATZ
OTHER DISTRICT JUDGE
C. EDWARD SIMPSON
CURTIS A. KIN
WILLIAM D. STEWART
SKYLIGHT ADVISORS LLC
SKYLIGHT ADVISORS LLC A DELAWARE LIMITED LIABILITY COMPANY
ZEPHYR INVESTMENT COMPANY LLC
ZEPHYR INVESTMENT COMPANY LLC A CALIFORNIA LIMITED LIABILITY COMPANY
ZEPHYR INVESTMENT COMPANY LLC A CALIFORNIA LIMITED LIABILITY COMPANY
SKYLIGHT ADVISORS LLC A DELAWARE LIMITED LIABILITY COMPANY
STARS ENERGY CORPORATION ROOFING AND SOLAR SYSTEMS A CALIFORNIA CORPORATION
LU ROBERT K
LU ROBERT K.
LESOWITZ SCOTT MICHAEL
ROWEN ERIC VICTOR
NEIGHBORS MICHAEL SLADE
LU ROBERT K
5/15/2020: Reply - REPLY REPLY IN SUPPORT OF DEFENDANTS' MOTION FOR ATTORNEYS' FEES AND REQUEST FOR SUPPLEMENTAL ATTORNEYS' FEES
5/7/2020: Appeal - Ntc Designating Record of Appeal APP-003/010/103
4/21/2020: Appeal - Ntc Designating Record of Appeal APP-003/010/103
3/27/2020: Writ - Return
3/9/2020: Abstract of Judgment - Civil and Small Claims
11/6/2019: Ex Parte Application - EX PARTE APPLICATION TO COMPEL DEPOSITION OF CROSS-DEFENDANT'S PERSON MOST QUALIFIED
11/1/2019: Judgment - JUDGMENT [PROPOSED] AS TO THIRD AMENDED COMPLAINT
10/3/2019: Opposition - OPPOSITION OF PLAINTIFF SKYLIGHT ADVISORS TO MOTION FOR SUMMARY ADJUDICATION BY DEFENDANTS
6/5/2019: Notice of Related Case
7/9/2018: Legacy Document - LEGACY DOCUMENT TYPE: Opposition
7/23/2018: Legacy Document - LEGACY DOCUMENT TYPE: Opposition
8/3/2018: Minute Order - Minute order entered: 2018-08-03 00:00:00
8/16/2018: Proof of Service (not Summons and Complaint)
11/28/2017: Legacy Document - LEGACY DOCUMENT TYPE: Proof-Service/Summons
3/14/2018: Case Management Statement
10/24/2018: Case Management Statement
10/29/2018: Opposition - Opposition to plaintiff and cross-defendant Skylight advisors LLC's motion to compel arbitration; declaration of Michael S Neighbors in support thereof
9/17/2018: Case Management Statement -
DocketDeclaration (of Adam Hyman); Filed by Skylight Advisors LLC, a Delaware limited liability company (Cross-Defendant); URBINO CONSTRUCTION (Cross-Defendant); KAZEM MOGHIM (Cross-Defendant)Read MoreRead Less
DocketDeclaration (of Stephen T Miholovich); Filed by Skylight Advisors LLC, a Delaware limited liability company (Cross-Defendant); URBINO CONSTRUCTION (Cross-Defendant); KAZEM MOGHIM (Cross-Defendant)Read MoreRead Less
DocketObjection (to Proposed Amended Judgment); Filed by Skylight Advisors LLC, a Delaware limited liability company (Cross-Defendant); URBINO CONSTRUCTION (Cross-Defendant); KAZEM MOGHIM (Cross-Defendant)Read MoreRead Less
DocketDeclaration (of Scott Lesowitz); Filed by Skylight Advisors LLC, a Delaware limited liability company (Cross-Defendant); URBINO CONSTRUCTION (Cross-Defendant); KAZEM MOGHIM (Cross-Defendant)Read MoreRead Less
DocketNotice (OF PROPOSED AMENDED JUDGMENT); Filed by Zephyr Investment Company LLC, a California limited liability company (Defendant); Joshua Bereny (Defendant)Read MoreRead Less
Docketat 11:00 AM in Department E, Curtis A. Kin, Presiding; Hearing on Ex Parte Application (for an Order Striking the Declaration of Alex Linhardt 2) Continuing the Hearing on the Motion for Attorneys' Fees 3) Allowing for Fees-related Discovery 4) Allowing the Filing a Response 5) Filing of Satisfaction of Judgment) - HeldRead MoreRead Less
Docketat 2:00 PM in Department E, Curtis A. Kin, Presiding; Hearing on Motion for Attorney Fees - HeldRead MoreRead Less
DocketMinute Order ( (Hearing on Motion for Attorney Fees; Hearing on Ex Parte Appl...)); Filed by ClerkRead MoreRead Less
DocketSupplemental Declaration (of Alex Linhardt in Support); Filed by Zephyr Investment Company LLC, a California limited liability company (Defendant)Read MoreRead Less
DocketOpposition (TO Skylight Advisors LLC et al Ex Parte Application); Filed by Zephyr Investment Company LLC, a California limited liability company (Defendant)Read MoreRead Less
DocketRequest; Filed by Interested PartyRead MoreRead Less
DocketRequest (FOR COPY OF COMPLAINT- 30 PAGES ); Filed by Interested PartyRead MoreRead Less
DocketSummons; Filed by Zephyr Investment Company LLC, a California limited liability company (Defendant)Read MoreRead Less
DocketSummons Filed; Filed by Attorney for PlaintiffRead MoreRead Less
DocketNotice of Case Management ConferenceRead MoreRead Less
DocketNotice (of case assignment); Filed by Zephyr Investment Company LLC, a California limited liability company (Defendant)Read MoreRead Less
DocketComplaint Fld - No Summons IssuedRead MoreRead Less
DocketComplaint; Filed by Zephyr Investment Company LLC, a California limited liability company (Defendant)Read MoreRead Less
DocketNotice (of Order to Show Cause re: failure to comply with trial court delay reduction act); Filed by Zephyr Investment Company LLC, a California limited liability company (Defendant)Read MoreRead Less
DocketComplaint ( (1st)); Filed by Skylight Advisors LLC, a Delaware limited liability company (Plaintiff)Read MoreRead Less
Case Number: EC067515 Hearing Date: October 02, 2020 Dept: E
MOTION FOR ATTORNEY FEES
[CCP §1033.5(c)(5), Civil Code § 1717]
Date: 10/2/20 (2:00 PM)
Case: Skylight Advisors v. Zephyr Investment Co., et al. (EC067515)
Defendant/cross-complainant Zephyr Investment Company LLC and defendant Joshua Bereny’s Motion for Attorney’s Fees is GRANTED IN PART.
As of the date of this hearing, defendant/cross-complainant Zephyr Investment Company LLC (“Zephyr”) and defendant Joshua Bereny (“Bereny”) (collectively “defendants”) seek $597,185.90 in attorney fees incurred in defense of the Third Amended Complaint and in prosecution of the Cross-Complaint. (10/1/20 Linhardt Decl. ¶ 6.) This amount consists of $509,532 sought in defendants’ initial fee motion, $50,906 sought in defendants’ reply, $32,732.90 requested in defendants’ supplemental reply brief, and $4,015 in opposition to the ex parte application relating to the fee motion. (See 10/1/20 Linhardt Decl. ¶¶ 2-5.)
As an initial matter, the Court finds that plaintiff/cross-defendant Skylight Advisors LLC (“Skylight”) and cross-defendant Kazem Moghim (collectively “Skylight”) had adequate notice that defendants were seeking attorney fees against them. The notice of motion states that it is based on all papers and pleadings on file, which includes the points and authorities and the proposed order. The motion and the supporting papers indicate that the request for attorney fees is against Skylight Advisors LLC and Moghim, jointly and severally. (Mot. at 1 & fn. 1 [“Kazem Moghim is jointly and severally liable for any fees awarded.”]; Proposed Order at 2 [defendants seek fees against “Plaintiff and Cross-Defendant Skylight Advisors LLC and Cross-Defendant Kazem Moghim,” jointly and severally].) The motion also notes that the lease containing the attorney fee provision at issue here was between Zephyr Investment Company LLC, as the landlord, and Skylight Advisors LLC, as the lessee. (Mot. at 1; Neighbors Decl. ¶ 2 & Ex. 1 at ¶ 1.1.) The motion also details Skylight Advisors LLC’s intransigence in refusing to comply with the terms of the lease and engaging in a “war of attrition” during the litigation. (Mot. at 2-6.) Based on the totality of the moving papers, both Skylight Advisors LLC and Moghim had adequate notice that defendants seek attorney fees against them.
The Court finds that defendants are the prevailing parties in the action. The matter arose out of a written Lease Agreement between Zephyr and plaintiff/cross-defendant Skylight Advisors LLC and out of a written Guaranty of Lease between Zephyr and cross-defendant Kazem Moghim. Both agreements provide that the prevailing party shall be entitled to reasonable attorney’s fees. (Neighbors Decl. ¶¶ 2, 3 & Exs. 1, 2.) The Court notes, however, that Bereny signed the agreements in his capacity as Zephyr’s manager. Accordingly, Bereny is not individually entitled to attorney fees. “Someone who is not a party to the contract has no standing to enforce the contract or to recover extra-contract damages for wrongful withholding of benefits to the contracting party.” (Hatchwell v. Blue Shield of California (1988) 198 Cal.App.3d 1027, 1034.)
Skylight argues that the request for attorney fees exceeds the amount allowed under the fee schedule set forth in Los Angeles Superior Court Local Rule 3.214. That may be true, but Local Rule 3.214 also provides the Court with discretion to award greater fees than allowed under the fee schedule. (Cruz v. Ayromloo (2007) 155 Cal.App.4th 1270, 1276 [“[T]he trial court permissibly departed from the guidelines [in the fee schedule] and based its fee award on the ‘lodestar’ method of calculating attorneys' fees . . . . [T]he trial court awarded fees consistent with Civil Code section 1717. Civil Code section 1717 permitted the trial court to award ‘reasonable’ attorneys' fees incurred ‘in connection with” the lease at issue in this case.’”].) Moreover, the attorney fee provisions for both agreements at issue state explicitly that the fee award “shall not be computed in accordance with any court fee schedule.” (Neighbors Decl. ¶¶ 2, 3 & Exs. 1 [¶ 31], 2.)
In addition, the Court’s determination of reasonable attorney fees is not impacted by whether defendants’ counsel has received fees from defendants as of yet or whether some other party (e.g., Bereny Enterprises LLC) may be footing defense counsel’s bill. (West Coast Development v. Reed (1992) 2 Cal.App.4th 693, 707 [“[T]he fact that a fee was not paid is no evidence that it has not been earned and that the client is not obligated to pay it.”]; International Billing Services, Inc. v. Emigh (2000) 84 Cal.App.4th 1175, 1192 [“Here, the [prevailing parties] became liable to pay the fee even if they were not the source of payment the attorney agreed to look to first. Therefore they incurred the fees and, by virtue of the reciprocity provision of [Civil Code] section 1717, they are entitled to an award of fees”] [emphasis in original].)
In evaluating defendants’ fee request, the Court also finds that the declarations of Michael S. Neighbors in support of the motion and reply are admissible. Counsel has a basis to set forth the number of years of experience each attorney has and the position the attorney or paralegal holds at the firm (e.g. Shareholder or Of Counsel), which the Court finds useful in evaluating the reasonableness of the claimed hourly rates. (Neighbors Motion Decl. ¶¶ 23-30.) The Court also finds that Counsel is qualified to authenticate the invoices from his firm, which are attached to the declaration. “A trial judge has broad discretion in admitting business records under Evidence Code section 1271, and it has been held that the foundation requirements may be inferred from the circumstances.” (People v. Dorsey (1974) 43 Cal.App.3d 953, 961.) Indeed, the invoices themselves indicate they pertain to the “Skylight Advisors Lease Dispute” and the dates and descriptions of work therein logically correspond to this action. (Neighbors Decl. ¶¶ 31-57 & Exs. 31-48.) Notably, even Skylight’s expert presumes the invoices to be authentic business records when analyzing their substance.
Based on the record before it, notwithstanding what any hourly rate survey or matrix may indicate, the Court in its discretion finds that the hourly rates charged by defense counsel in this action are reasonable. (Syers Properties III, Inc. v. Rankin (2014) 226 Cal.App.4th 691, 702.) The Court notes that the hourly rates charged by defense counsel are in line with customary rates of a large global law firm with expertise in complex commercial real estate litigation and that, consistent with the relatively less complex nature of the instant litigation, defense counsel leanly staffed the matter with relatively junior associates at lower billing rates. (See 2/28/20 Neighbors Decl. ¶¶ 22-30; 5/15/20 Neighbors Decl. ¶¶ 5-6; see also 9/22/20 Linhardt Decl. ¶¶ 11-16, 18.) This approach was entirely appropriate and reasonable under the circumstances.
As for whether Zephyr’s claimed billing entries are reasonable, as an initial matter, the Court notes: “When confronted with hundreds of pages of legal bills, trial courts are not required to identify each charge they find to be reasonable or unreasonable, necessary or unnecessary . . . . A reduced award might be fully justified by a general observation that an attorney overlitigated a case or submitted a padded bill or that the opposing party has stated valid objections.” (Gorman v. Tassajara Development Corp. (2009) 178 Cal.App.4th 44, 101.) With respect to Skylight’s various challenges to the reasonableness of the billing entries, the Court makes the following findings:
Defendants do not seek fees incurred in the prosecution of the prior unlawful detainer action. (Mot. at 7 & fn. 3.) Defendants highlighted in dark gray the entries for which they were not seeking fees, including the unlawful detainer matters. (Neighbors Decl. ¶¶ 31-57 & Exs. 22-48.) As for work in connection with a notice to cure-or-quit in May 2018 and a notice to pay-or-quit in June 2018, those notices formed the basis for the ejectment and breach of contract causes of action in the Cross-Complaint in this action.
Defendants are correct that arbitration of this action was not required due to the presence of third parties (including defendant Bereny and cross-defendants Urbino Construction Inc. and Stars Energy Corporation Roofing and Solar Systems) who were not signatories to the lease containing the arbitration provision. (Neighbors Decl. ¶ 16 & Ex. 15.) Accordingly, Zephyr was entitled to oppose the motion to compel arbitration and, as the prevailing party, now collect fees for opposing that motion and litigating this action thereafter. Further, because Zephyr’s claims against Urbino and Stars Energy were intertwined with the claims against Skylight and Moghim, the Court declines to apportion the fees as between the cross-defendants.
Defendants are entitled to redact entries that contained privileged information. (Hartford Casualty Ins. Co. v. J.R. Marketing, L.L.C. (2015) 61 Cal.4th 988, 1005–06 [“If privileged information on these subjects is included in counsel's billing records, it can be redacted for purposes of assessing whether counsel's bills are reasonable”].) The redactions highlighted by Skylight’s expert do not prevent the Court from determining whether the billing was incurred in this matter and whether such billing was reasonable. (Stiefel Decl. ¶¶ 31, 38 & Exs. D, F.) Many phone calls, conferences, and emails, the contents of which are protected by attorney-client privilege, are to be expected in a heavily litigated action like this one.
The purportedly block billed entries generally contain sufficient detail for the Court to evaluate their reasonableness. (Opposition at 10-11; Stiefel Decl. ¶¶ 37, 38 & Exs. E, F) They generally appear reasonable and necessary to the successful resolution of the case. The Court thus finds no basis or reason to apply any across-the-board reductions for block billing or redacted entries.
Zephyr is entitled to fees for post-reply briefing. (Graham v. DaimlerChrysler Corp. (2004) 34 Cal.4th 553, 580 [“It is well established that plaintiffs and their attorneys may recover attorney fees for fee-related matters”].) Skylight and Moghim were on notice that they may be liable for fees they caused defendants to incur after the reply was filed, including by the filing of a supplemental opposition and ex parte application to fix the amount of bond to stay enforcement on appeal. (Reply at 5.)
The Court agrees with Skylight that there have been some unnecessary and excessive billings by defendants’ attorneys for certain matters (Stiefel Decl. ¶¶ 42, 44 & Exs. G, H), and the Court accordingly makes the following reductions:
· Preparation for and finalization of the Case Management Statement was a task that should have taken no more than three hours of an associate attorney’s time (3 hours x $330 = $990). The $2,147.50 claimed for this task should be reduced by $1,157.50
· Defendants’ successful motion for summary judgment involved the fairly straightforward application of principles of estoppel and res judicata. Accordingly, the Court finds the 82.50 hours devoted to this task excessive and will reduce the claim of $39,078.50 for this work by $9,000 (20 hours x $450).
· Preparation of a form Memorandum of Costs is a task that should have taken no more than four hours of an associate attorney’s time (4 hours x $450 = $1,800). The $4,449.50 claimed for this task should be reduced by $2,649.50
· The claimed 11.60 hours for work on an ex parte application to continue trial and motion dates to which Skylight stipulated was excessive. Applying a 50% reduction to the $5,360.50 claimed, the amount should be reduced by $2,680.25
· The claimed 50.70 hours spent on the motion for judgment on the pleadings based on lack of specificity and collateral estoppel was excessive. Applying a 30% reduction to the $17,596 claimed, the amount should be reduced by $5,278.80
· The relatively short ex parte application to compel the continued deposition of Skylight’s PMK should have taken no more than six hours to prepare (6 hours x $450 = $2,700). The claimed $5,580 should accordingly be reduced by $2,880
· In connection with the instant fee motion, it appears defense counsel has billed upwards of $55,000 in connection therewith. (See 5/15/20 Neighbors Decl. ¶ 7 & Ex. 49; 9/22/20 Linhardt Decl. ¶ 7; 10/1/20 Linhardt Decl. ¶¶ 4-5). While the Court recognizes Skylight’s opposition has contributed to such costs, the Court finds the hours spent on this matter excessive (particularly the nearly $40,000 in fees generated in connection with the initial motion papers) and will reduce the claimed amount by $20,000.
For the reasons set forth above, the Court will reduce the amount of fees by $43,646.05. Other than those specific matters identified and discussed above, the Court finds defense counsel’s billing entries were reasonable and necessary. Thus, the Court does not find any further reduction is warranted. In so concluding, the Court notes that, to the extent defendants may have worked on matters that were not used at trial or were denied, defendants were entitled to pursue these legal theories and recover the fees incurred. (Greene v. Dillingham Construction, N.A., Inc. (2002) 101 Cal.App.4th 418, 424, quoting Sokolow v. County of San Mateo (1989) 213 Cal.App.3d 231, 250 [“Attorneys generally must pursue all available legal avenues and theories in pursuit of their clients' objectives; it is impossible, as a practical matter, for an attorney to know in advance whether or not his or her work on a potentially meritorious legal theory will ultimately prevail.”].)
In the supplemental opposition, Skylight also states that defendants and their counsel failed to redact Moghim’s Social Security number in the Cross-Complaint and proposed judgment, which purportedly led to the theft of Moghim’s identity. (Moghim Decl. ¶¶ 3-8.) While the Court has discretion to reduce the lodestar amount based on equitable principles, the Court does not exercise such discretion here. (EnPalm, LLC v. Teitler (2008) 162 Cal.App.4th 770, 774, 778 [“[T] he trial court's use of equitable considerations to reduce the lodestar amount of appellants' attorney fees because most of those fees were unnecessary was proper under both PLCM and Graham”].) Other than speculation, Skylight has no evidence that any of the Zephyr parties posted the “Ripoff Report,” where a copy of the cross-complaint containing the guarantee with Moghim’s unredacted Social Security number was posted, or that the Ripoff Report led to any purported identity theft.
Accordingly, using the appropriate lodestar approach, and based on the foregoing findings and in view of the totality of the circumstances, the Court finds that the total and reasonable amount of attorney’s fees and costs incurred for the work performed in connection with Zephyr Investment Company LLC’s defense against the Third Amended Complaint and prosecution of the Cross-Complaint against Skylight Advisors LLC is $553,539.85, out of $597,185.90 requested. Such fees are awarded to defendant/cross-complaint Zephyr Investment Company LLC against plaintiff/cross-defendant Skylight Advisors LLC and cross-defendant Kazem Moghim, jointly and severally.
Plaintiff/cross-defendant Skylight Advisors LLC and cross/defendants Urbino Construction Inc., and Kazem Moghim’s Ex Parte Application for an Order (1) Striking the Declaration of Alex Linhardt, (2) Continuing the Hearing on the Motion for Attorneys' Fees, (3) Allowing for Fee-related Discovery, (4) Allowing the Filing a Response, and (5) Filing of Satisfaction of Judgment is DENIED.
In the ex parte application, Skylight seeks a continuance of this motion based on the filing of the declaration of Alex Linhardt in support of the supplemental reply. Skylight contends that the Linhardt declaration contains new facts concerning the experience of the attorneys who worked on this matter, which could have been provided in the moving papers. As discussed above, the Neighbors declarations contain the necessary information for the Court to evaluate the reasonableness of the hourly rates. Accordingly, the supplemental (and consistent) information in the Linhardt declaration was not necessary to the Court’s decision. With respect to the objection that the Linhardt declaration lacks foundation concerning the invoicing practices of counsel, the Court finds that the Linhardt declaration is admissible for the same reasons as the Neighbors declarations. With respect to Skylight’s request to conduct discovery regarding the reasonableness of the billing entries, the Court believes Skylight has had ample opportunity to dispute the reasonableness of the fee request, including by submitting an expert declaration. The Court thus finds that additional discovery is unwarranted to evaluate or oppose defendants’ fee request.
With respect to the request for a satisfaction of judgment, the Court inquires from defendants whether they have received the check Moghim claims he served. (Moghim Ex Parte Decl. ¶ 2 & Ex. 1.)