On 06/01/2017 TIMED OUT LLC filed a Personal Injury - Other Personal Injury lawsuit against PRISMA ENTERTAINMENT LLC. This case was filed in Los Angeles County Superior Courts, Stanley Mosk Courthouse located in Los Angeles, California. The case status is Pending - Other Pending.
Pending - Other Pending
Los Angeles County Superior Courts
Stanley Mosk Courthouse
Los Angeles, California
TIMED OUT LLC
PRISMA ENTERTAINMENT LLC
DOES 1 TO 10
PLAN B GENTLEMEN'S CLUB
MUCH AND HOUSE PUBLIC RELATIONS AND
CHIPPEWA DBA MUCH AND HOUSE PUBLIC RELATIONS AND MARKETING MANAGEMENT
KREMER MARK D. ESQ.
BERGLUND MARIE E. ESQ.
8/29/2017: CIVIL DEPOSIT
10/27/2017: CROSS-DEFENDANT CHIPPEWA DBA MUCH AND HOUSE PUBLIC RELATIONS AND MARKETING MANAGEMENT, SUED AND SERVED HEREIN AS CHIPPEWA SPECIAL ANSWER TO CROSS-COMPLAINANT PRLSMA ENTERTAINMENT, LLC, D/B/A/ PLAN B G
10/27/2017: ANSWER TO CROSS-COMPLAINT
10/10/2018: Minute Order
11/1/2018: Minute Order
12/5/2018: Motion in Limine
12/5/2018: Motion in Limine
12/5/2018: Exhibit List
12/5/2018: Trial Brief
12/5/2018: Trial Brief
12/14/2018: Motion in Limine
12/21/2018: Proof of Service by Mail
1/9/2019: Minute Order
Hearingat 09:00 AM in Department 61 at 111 North Hill Street, Los Angeles, CA 90012; Jury TrialRead MoreRead Less
Hearingat 09:00 AM in Department 61 at 111 North Hill Street, Los Angeles, CA 90012; Final Status ConferenceRead MoreRead Less
DocketNotice of Ruling; Filed by Prisma Entertainment, LLC (Defendant)Read MoreRead Less
Docketat 09:00 AM in Department 61; Hearing on Motion - Other (PRISMA ENTERTAINMENT, LLC'S MOTION TO EXCLUDE EXPERT TESTIMONY OF STEPHEN CHAMBERLIN; MEMORANDUM OF POINTS AND AUTHORITIES; DECLARATION OF HAYK GHALUMYAN) - Held - Motion GrantedRead MoreRead Less
DocketOrder Appointing Court Approved Reporter as Official Reporter Pro Tempore; Filed by Timed Out LLC (Plaintiff)Read MoreRead Less
DocketNotice of Ruling (Ruling Re Defendant Prisma Entertainment, LLC's and Cross-Defendant Chippewa's Motion to Exclude Expert Testimony of Stephen Chamberlin); Filed by ClerkRead MoreRead Less
DocketMinute Order ( (Hearing on Motion - Other PRISMA ENTERTAINMENT, LLC'S MOTION ...)); Filed by ClerkRead MoreRead Less
Docketat 09:00 AM in Department 61; Hearing on Motion - Other (MOTION TO EXCLUDE EXPERT TESTIMONY OF STEPHEN CHAMBERLIN) - Not Held - Continued - Court's MotionRead MoreRead Less
DocketNotice (of Hearing Date Motion to Exclude Expert Testimony of Stephen Chamberlin); Filed by Prisma Entertainment, LLC (Defendant)Read MoreRead Less
DocketMinute Order ( (Hearing on Motion - Other MOTION TO EXCLUDE EXPERT TESTIMONY ...)); Filed by ClerkRead MoreRead Less
DocketNOTICE RE: CONTINUANCE OF HEARINGRead MoreRead Less
DocketNotice Re: Continuance of Hearing and Order; Filed by ClerkRead MoreRead Less
DocketNotice Re: Continuance of Hearing and Order; Filed by ClerkRead MoreRead Less
DocketOSC-Failure to File Proof of Serv; Filed by ClerkRead MoreRead Less
DocketNotice of Case Management Conference; Filed by ClerkRead MoreRead Less
DocketNOTICE OF CASE MANAGEMENT CONFERENCERead MoreRead Less
DocketORDER TO SHOW CAUSE HEARINGRead MoreRead Less
DocketComplaint; Filed by Timed Out LLC (Plaintiff)Read MoreRead Less
DocketSUMMONSRead MoreRead Less
DocketCOMPLAINT FOR: 1. VIOLATION OF STATUTORY RIGHTS OF PUBLICITY ;ETCRead MoreRead Less
Case Number: BC663581 Hearing Date: September 24, 2020 Dept: 61
Intervenor Chippewa dba Much and House Public Relations and Marketing Management’s Motion to Vacate Judgment is DENIED.
MOTION TO VACATE JUDGMENT
Chippewa moves to vacate the judgment in this case between Timed Out and Prisma on the ground that it was obtained by extrinsic fraud, which deprived Chippewa of the opportunity for a fair adversarial hearing. (Motion at p. 7.)
Extrinsic fraud occurs when a party is deprived of the opportunity to present his claim or defense to the court; where he was kept ignorant or, other than from his own negligence, fraudulently prevented from fully participating in the proceeding. Examples of extrinsic fraud are: failure to give notice of the action to the other party, and convincing the other party not to obtain counsel because the matter will not proceed (and then it does proceed). The essence of extrinsic fraud is one party's preventing the other from having his day in court. Extrinsic fraud only arises when one party has in some way fraudulently been prevented from presenting his or her claim or defense.
A motion to vacate a judgment for extrinsic fraud is not governed by any statutory time limit, but rather is addressed to the court's inherent equity power to grant relief from a judgment procured by extrinsic fraud.
(Department of Industrial Relations v. Davis Moreno Construction, Inc. (2011) 193 Cal.App.4th 560, 572, internal citations, quotation marks, and alterations omitted.)
The basis for Chippewa’s request for relief requires some explanation of the procedural history of this case. After Timed Out filed suit against Prisma for violation of rights of publicity, Prisma filed a Cross-Complaint against Chippewa for various forms of indemnity and declaratory relief on August 25, 2017, stating that the allegations of Timed Out should have been stated against Chippewa and other cross-defendants. (XC ¶ 14.) Chippewa in turn filed an answer to the Cross-Complaint and a special answer to the Complaint under Code of Civil Procedure § 428.70 on October 27, 2017.
Prisma and Chippewa collaborated through much of the litigation. Chippewa’s counsel claims to have worked with Prisma on a section 998 offer to compromise served on October 5, 2018, although the offer is described as an offer by Prisma to Timed Out. (Vallejo Decl. ¶ 3.) Chippewa and Prisma also collaborated on motions to exclude the testimony of Timed Out’s damages expert, and retained the same damages expert themselves. (Vallejo Decl. ¶ 4.) They further coordinated on motions in limine and oppositions to Timed Out’s efforts to introduce other potential damages witnesses. (Vallejo Decl. ¶ 5.) They further worked with jury consultant Paulette Taylor for voir dire during trial on January 15–17, 2020. (Vallejo Decl. ¶ 5.)
On January 21, 2020, Timed Out announced that it had reached a partial settlement with Prisma. Timed Out disclosed that it and Prisma had resolved the claims of two models, whose claims had apparently accrued after Chippewa no longer managed Prisma’s social media account, and that Prisma was immediately dismissing its cross-complaint against Chippewa. (Vallejo Decl. ¶ 5, Exh. A.)
The course of the trial that occurred thereafter is a disputed matter, but a verdict was entered in Timed Out’s favor in the amount of $50,000 on January 24, 2020. Judgment on the verdict was entered on February 21, 2020.
Timed Out filed a motion for attorney fees on March 20, 2020, seeking $504,369.00 in fees and $32,053.10 in costs. On March 28, 2020, Timed Out’s counsel informed Chippewa’s counsel that one term of the settlement agreement was Prisma’s assignment of its claims against Chippewa to Timed Out. (Vallejo Decl. ¶ 12.) Chippewa’s counsel asked for and received a copy of the settlement agreement from Timed Out on April 1, 2020. (Vallejo Decl. ¶ 13.) Prisma filed no opposition to the motion for attorney fees.
The settlement agreement disclosed that Prisma had agreed to pay $175,000.00 to Timed Out for the settlement obtained. (Motion Exh. F, ¶ 1.) It also disclosed the following terms that Chippewa finds objectionable:
Prisma affirms that it has not waived or withdrawn its claims against Chippewa, and agreed to execute an assignment of its claims against Chippewa to Timed Out, which would include any damages, costs, or attorney fees imposed against Chippewa (Motion Exh. F ¶ 3);
Prisma agrees that it will not contest entry of judgment according to the terms of the jury verdict, that it will “in no event . . . claim to be a prevailing party for purposes of awarding attorney fees, expenses or costs,” and waives any right to request a new trial, a JNOV, or to seek an appeal of the verdict (Motion Exh. F ¶ 8);
Although Prisma agreed to be liable for any judgment entered on the jury verdict in the action, Timed Out agreed to limit its execution of the judgment against Prisma “to not more than twenty thousand dollars,” in addition to the $175,000 provided by the settlement (Motion Exh. F ¶ 9);
Prisma agrees to cooperate with any efforts by Timed Out to prosecute Chippewa for any claims under the present action, including the provision of documents and testimony relating to Prisma’s fees and costs in this action, and the waiver of privileges with respect to those fees (Motion Exh. F ¶ 10);
The parties agree that the contract will not be interpreted to benefit Chippewa (Motion Exh. F ¶ 15).
Chippewa also identifies several provisions that it contends were meant to compromise the integrity of the trial ultimately conducted between Prisma and Timed Out:
The parties agreed to “promptly and efficiently conduct trial” (Motion Exh. F, Recital 4, ¶ 6);
Prisma agreed not to contest that Chippewa published the likenesses of the remaining models on its behalf, and agreed not to dispute that Timed Out was the assignee of the claims of the models (Motion Exh. F ¶ 6);
Prisma agreed not to “unreasonably object to evidence of liability or damages presented by Timed Out in a manner consistent with the terms of this agreement,” and agreed to reasonably stipulate to admissibility of Timed Out’s exhibits (Motion Exh. F ¶ 6);
Prisma agreed that Timed Out could call Frank Grundel, Prisma’s general manager and president, as a witness in its case in chief, and further agreed to make Grundel available for interview prior to his testimony. (Motion Exh. F ¶ 7.)
As to the course of trial itself, Chippewa identifies the following instances that it contends show improper collusion between Timed Out and Prisma:
Prisma’s comparatively short cross-examination of Peter Ham, Timed Out’s principal, which occupies but five pages of the transcript, as opposed to the twenty pages of direct examination (Motion Exh. B at pp.74–78);
Prisma did not offer any objections during Hamm’s testimony;
Prisma did not object to the authentication of one of the assignments of an absent model’s claims;
Timed Out was allowed to call Prisma’s own principal, Frank Grundel, as a witness in its case, without designating him a hostile witness, and did not object when he gave hearsay testimony and corroborated the deposition testimony of a witness who was not proven to be unavailable (Motion Exh. C at pp. 105–123);
Prisma did not object to Timed Out’s attempt to seek damages for a model, Leanna Decker, who did not appear to testify (Motion Exh. D at pp. 71–86.)
Chippewa thus argues, based on the agreement and the conduct of the trial, that a verdict was obtained against Prisma through its own improper collusion with Timed Out.
Timed Out, in turn, argues the following: (1) that Chippewa was permitted to intervene only for the purpose of opposing Timed Out’s attorney fees motion and did not seek leave to intervene, either during or after trial, to protect its interests as relate to the verdict (Opposition at pp. 13–15); (2) that Chippewa’s contentions of collusion may be asserted as a defense against indemnity in a separate action if brought against it (Opposition at pp. 15–16); and (3) that Chippewa’s contentions of collusion are without basis and its authorities for same are inapposite. (Oppositeion at pp. 17–23.)
The court first addresses Timed Out’s arguments concerning the procedural posture of Chippewa’s motion. Timed Out notes that this court granted Chippewa’s motion for leave to intervene to file an opposition to Timed Out’s otherwise unopposed motion for attorney fees, and made no mention of Chippewa’s ability to file a motion to vacate the judgment. (See 6/26/2020 Order.) Timed Out also notes that one of the conditions for permissive intervention is that the intervening party “must not enlarge the issues raised by the original parties.” (Kuperstein v. Superior Court (1988) 204 Cal.App.3d 598, 600.)
Timed Out’s position is unpersuasive. Although it is true that Chippewa’s motion for leave to interevene specifically sought leave to oppose Timed Out’s motion for attorney fees, the arguments raised in its application are identical to its arguments supporting the present motion to vacate — namely, that Timed Out obtained its judgment against Prisma by improper collusion. (See 6/24/2020 Ex Parte Application at pp. 4, 9.) A motion to vacate the judgment was thus a foreseeable development from the granting of leave to intervene. Moreover, the present motion does not “enlarge the proceedings” within the meaning of Code of Civil Procedure § 387. Chippewa’s motion does not ask the court to adjudicate, or the parties to litigate, matters unrelated to the verdict and judgment already obtained, but specifically asks for a determination as to the validity of the judgment obtained in this action, based on actions that occurred therein. Courts have permitted third parties to intervene and challenge judgments for just such reasons. (See Villaruel v. Arreola
For much the same reasons, it is of little moment that fraud and collusion exist as potential defenses to any action in indemnity or contribution that Timed Out may bring against Chippewa in the future, since third parties affected by a collusive or fraudulent judgment may also elect to bring a motion in the original action seeking to set the judgment aside. (See Villaruel, supra, 66 Cal.App.3d at p. 318; see also Span, Inc. v. Associated Internat. Ins. Co. (1991) 227 Cal.App.3d 463, 485 fn. 11 [“On appeal, Ledesma argues an action for declaratory relief is the proper vehicle to attack a judgment as collusive. It appears the correct rule is that either means is appropriate.”]) The authority that Timed Out presents for the contrary position is inapposite, since it concerned a third-party intervenor’s standing to move to vacate a judgment under Code of Civil Procedure § 663, which allows a “party aggrieved” to move to set aside a judgment without basis in a special verdict or unsupported by legal reasoning. (See Tomassi v. Scarff (2000) 85 Cal.App.4th 1053, 1057–58.) This authority has little application to the present motion, which is not brought under section 663.
As to its argument on the merits, Timed Out argues Chippewa had filed a special answer in this case under Code of Civil Procedure § 428.70, and had its counsel in the courtroom as trial took place, yet never asserted any defense based on its special answer or sought leave to intervene as the trial played out before it. (Opposition at pp. 14–15.) Thus Timed Out argues that Chippewa cannot claim to have been “fraudulently prevented from presenting [its] claim or defense.” (See City and County of San Francisco v. Cartagena (1995) 35 Cal.App.4th 1061, 1067.)
Timed Out also argues that the settlement agreement was not collusive, because nothing in the agreement prevented Prisma from defending itself in the trial or opposing Timed Out’s motion for attorney fees, and nothing otherwise incentivized Prisma to relent in its own defense. (Opposition at p. 17.) Timed Out analogizes the agreement between itself and Prisma to agreements frequently executed in the insurance context, in which an injured third party sues an insured defendant, but agrees to a stipulated judgment with that defendant in exchange for a covenant not to execute against them and an assignment of the defendant’s claims against their insurer. (Opposition at pp. 17–18, citing Samson v. Transamerica Ins. Co. (1981) 30 Cal.3d 220, 240.)
Timed Out contests Chippewa’s characterization of the trial as a “sham,” noting that Prisma cross-examined every witness that Timed Out presented and that the jury, consistent with Prisma’s arguments, reduced Timed Out’s requested recovery. (Opposition at p. 20.)
Chippewa cites the following standard to determine what is or is not collusion: “
Collusion has been variously defined as (1) ‘a deceitful agreement or compact between two or more persons, for the one party to bring an action against the other for some evil purpose, as to defraud a third party of his right’; (2) ‘a secret arrangement between two or more persons, whose interests are apparently conflicting, to make use of the forms and proceedings of law in order to defraud a third person, or to obtain that which justice would not give them, by deceiving a court or its officers'; and (3) ‘a secret combination, conspiracy, or concert of action between two or more persons for fraudulent or deceitful purposes.
(Span, Inc. v. Associated Internat. Ins. Co. (1991) 227 Cal.App.3d 463, 484.) It then argues that the settlement agreement, which contained an undisclosed assignment of Prisma’s claims against Chippewa to Timed Out, and which also contained a covenant not to execute any judgment against Prisma in excess of $20,000, constituted a fraud on the court.
The agreement alone does not constitute collusion. Timed Out is correct to note that similar agreements in the insurance context are upheld, absent additional evidence of fraud or collusion between settling parties. In Safeco Ins. Co. of America v. Parks (2009) 170 Cal.app.4th 992, the court concluded that no substantial evidence existed to support a defense of collusion, where an insured assigned her bad faith breach of contract claims against her insurer to an injured third party prior to arbitration proceeding. Although the arbitration award in that case against the insured was “very large,” the court noted that the arbitration had taken place before a neutral tribunal and that the matter of the insured’s liability was actively litigated. (Id. at p. 1014.) The court also concluded that there was no evidence that the arbitration award was unreasonably high, as compared to other matters involving similar issues, and that while the insurer presented evidence that certain lines of inquiry had not been pursued, there was “little if any evidence these omitted issues constituted a ‘viable’ defense.” (Ibid.)
In Samson v. Transamerica Ins. Co. (1981) 30 Cal.3d 220, the California Supreme Court upheld a $725,000 damage award issued against an insured in favor of an injured party, that had been obtained after the insured and third party had entered into a settlement with another insurer and the insured for $100,00 policy limits and a covenant not to execute against the insured and an assignment of his claims. (Id. at p. 228–29.) Although the insured thereafter agreed to participate in trial, they did not present a defense. (Id. at p. 228–29.) After the injured party brought an action against the remaining insurer, the insurer claimed collusion, pointing to the settlement, the assignment of claims, the covenant not to execute, and the unopposed trial proceeding. (Id. at p. 240.) The court, however, noted that other tribunals “have frequently held that an insured breaches no duty to the insurance company when he assigns his rights against the company to the injured plaintiffs in return for a covenant not to execute,” particularly where a liability insurer has wrongly failed to offer a defense for their insured, which the court found that Transamerica had done. (Id. at p. 241.) Although Transamerica argued that its own breach could not excuse actual collusion, pointing to the unopposed trial, the court noted that the insured who failed to defend the case likely could present no defense, owing to a prior criminal guilty plea based on the conduct forming the basis for the claim. (Id. at p. 242.) The court also noted that no evidence supported the conclusion that the damage award was out of proportion to similar claims. (Id. at p. 242.)
Other courts, however, have found collusion to exist in similar circumstances. In Andrade v. Jennings (1997) 54 Cal.App.4th 307, a tuna boat captain who suffered a workplace injury settled with his employer, obtained assignment of his employer’s claims against his insurer, and intervened in the employer’s action against its insurer. (Id. at p. 313.) The court, however, upheld a determination that the settlement (and subsequent court proceedings based thereon) were collusive and entered into in violation of the insured employer’s obligations to its insurer. The court noted that the parties had agreed to a stipulated judgment of $1.5 million where the claim’s value was between $150,000 and $250,000, and where the employer insured was prohibited by contract from settling without the insurer’s consent. (Id. at pp. 329–30.) The court also considered evidence that a “vigorous defense effort” could have “raised weaknesses” in the captain’s liability case. (Id. at pp. 331–32.) Nor was the magistrate overseeing the entry of stipulated judgment informed of the assignment and covenant not to execute. (Id. at p. 333.) Although the captain argued that the insurer knew of the prove-up hearing on the stipulated judgment and failed to appear, the court held that evidence supported the conclusion that the insurer’s failure to appear was reasonable in light of its insured’s admission of liability in the executed settlement. (Id. at p. 333.)
In Span, Inc. v. Associated Internat. Ins. Co. (1991) 227 Cal.App.3d 463, the court held that triable issues of material fact existed as to the issue of collusion in a suit brought by a employee who was injured while on the job at his insured employer, against his one of his employer’s insurers. In the suit brought by the employee against the insured employer, the employer “waived opening and closing argument, stipulated to liability and to the reasonableness and necessity of [employee’s] medical bills and waived cross-examination of . . . the only witness who testified.” (Id. at p. 471.) The court concluded that the action “lacked the attributes of an adversary proceeding in a case which involved damages in excess of $1 million,” and distinguished the Samson case on the grounds that there were prior guilty pleas establishing liability, or other evidence indicating “a defense of the . . . action would have been useless or futile.” (Id. at p. 485.)
Based on this authority, and the evidence presented by Timed Out, the court concludes that the judgment entered in this action was not the product of collusion. Prisma and Timed Out conducted a full trial on the merits of the claims of four models; Prisma presented opening argument, conducted cross-examination, and offered closing arguments that cited the testimony elicited in cross-examination. In that argument, Prisma argued not merely for a reduction in damages, but also argued that the four models at issue had not been harmed at all by Prisma’s misappropriation. (Opposition Exh. 3 at pp. 98–100.) Although Chippewa argues that Prisma did not object to lay testimony concerning damages offered by Timed Out’s principal, Prisma did object to similar testimony provided by the models in question. And while Chippewa contends that Prisma failed to object to a request for damages for a model who did not testify, the record in fact shows that Prisma argued against awarding damages for her based on a purported lack of testimony. (Opposition Exh. 3 at p. 100.) Prisma’s efforts were in fact partially successful; although Timed Out sought $95,000 in damages (Opposition Exh. 3 at p. 91), the ultimate award was a much-reduced $50,000.
The outcome of the trial and the mode of Prisma’s participation within it underscores that the settlement agreement at issue here is not like those found to be collusive in the cases above. It is true that the agreement contains an assignment of Prisma’s claims and a covenant not to execute. Such a covenant is indeed a factor in the collusion analysis. (See Safeco, supra, 170 Cal.App.4th at p. 1013.) But the presence of such a covenant is not sufficient on its own for a finding of collusion. (Ibid. [settlement with covenant not to execute could later bind insurer “[p]rovided that such settlement is not unreasonable and is free from fraud or collusion”].) This is particularly true in the present case, when the covenant not to execute did not exempt Prisma from the practical consequences of the judgment, but merely capped the potential for execution at $20,000. Prisma thus continued to have a stake in its own defense, as it demonstrated at trial.
Such proceedings were at all times open to Chippewa, whose counsel observed the trial as it unfolded. (Griffin Decl. ¶ 6.)
Chippewa argues that the terms of the settlement, including the assignment of claims and covenant not to execute, were required to be disclosed to the court. (Motion at pp. 11–12.) Yet the authority that it presents does not stand for that proposition. The cases rather address the need to disclose “sliding scale” agreements “in which the plaintiff settles with one or more, but not all, of the defendants and the amount the settling defendant ultimately owes the plaintiff is affected by the amount the plaintiff recovers against nonsettling defendants.” (Alcala Co. v. Superior Court (1996) 49 Cal.App.4th 1308, 1312.) Likewise, the case Diamond v. Reshko (2015) 239 Cal.App.4th 828, 844–45, addressed a court’s erroneous decision to exclude evidence that one of many defendant tortfeasors had settled their claims with plaintiffs in the case yet had also agreed to remain a party in the trial. (Id. at p. 847–48.) These authorities are inapposite where (1) the existence of the settlement was announced to the court and the jury at trial’s initiation and (2) where the precise terms of the settlement to which Chippewa objects did not impede Prisma’s presentation of an adversarial case or deprive Chippewa of an opportunity for a fair adversarial hearing.
In its reply, Chippewa refers to the declarations of Murray B. Greenberg and David B. Parker, concurrently submitted in opposition to Timed Out’s motion for attorney fees, who opine that counsel for Timed Out and Prisma violated their duty of candor to this court when they failed to disclose the full terms of the settlement agreement. (See Parker Decl. ¶ 7, citing Rules of Professional Conduct 3.3, 4.1, and 8.4, and Bus. & Prof. Code § 6068, subd. (d).) Yet these declarations essentially repeat the arguments of the opposition, merely re-framed by reference to the ethical rules. Neither Parker nor Greenberg present authority for the proposition that the failure to disclose the terms previously identified warrants setting aside a verdict reached after an adversarial hearing. Chippewa in reply in fact concedes that no such authority exists. (Reply at p. 3.)
Accordingly, the motion to vacate the judgment is DENIED.
Plaintiff Timed Out, LLC’s Motion for Attorney Fees and Costs is GRANTED in the amount of $306,378.30 in fees, and $32,053.10 in costs.
Timed Out submits objections to the declarations of Glen Kulik, David Parker, and Murray Greenberg. The objections to the Kulik declaration are OVERRULED, as they consist of attempts to impeach Kulik’s credibility by argument, rather than substantive reasons that his opinion and analysis cannot be considered by the court. The court considers Timed Out’s arguments submitted against Kulik’s declaration and weighs them against his testimony.
Timed Out’s objections to the Parker and Greenberg declarations target the foundation for their conclusion that the trial was non-adversarial or collusive, and further argue that their testimony constitutes improper expert opinion on legal issues. The court agrees with Time Out on this latter point. “While in many cases expert opinions that are genuinely needed may happen to embrace the ultimate issue of fact (e.g., a medical opinion whether a physician's actions constitute professional negligence), the calling of lawyers as ‘expert witnesses' to give opinions as to the application of the law to particular facts usurps the duty of the trial court to instruct the jury on the law as applicable to the facts, and results in no more than a modern day ‘trial by oath’ in which the side producing the greater number of lawyers able to opine in their favor wins.” (Summer v. A.L. Gilbert Co. (1999) 69 Cal.App.4th 1155, 1179.) Parker and Murray’s testimony concerning the violation of ethical obligations or the collusive nature of the trial are legal issues that are properly the province of this court to decide. Accordingly, Timed Out’s objections to the Greenberg and Parker declarations are SUSTAINED.
Timed Out seeks an attorney fee award of $504,369.00 in fees and $32,053.10 in costs under Civil Code § 3344.
Parties to litigation must generally bear their own attorney’s fees, unless they otherwise agree. (Code Civ. Proc. § 1021.) But Civil Code § 3344, the statute that describes an individual’s right to their likeness and remedy for misappropriation thereof, provides, “The prevailing party in any action under this section shall also be entitled to attorney's fees and costs.” (Civ. Code § 3344, subd. (a).)
Since Timed Out obtained judgment in its favor, it is the prevailing party, and since one of the claims upon which it prevailed was brought under Civil Code § 3344, it is entitled to attorney fees and costs under Civil Code § 3344.
“It is well established that the determination of what constitutes reasonable attorney fees is committed to the discretion of the trial court, whose decision cannot be reversed in the absence of an abuse of discretion.” (Melnyk v. Robledo (1976) 64 Cal.App.3d 618, 623.) In exercising its discretion, the court should consider a number of factors, including the nature of the litigation, its difficulty, the amount involved, the skill required in handling the matter, the attention given, the success or failure, and the resulting judgment. (See id.)
In determining the proper amount of fees to award, courts use the lodestar method. The lodestar figure is calculated by multiplying the total number of reasonable hours expended by the reasonable hourly rate. “Fundamental to its determination . . . [is] a careful compilation of the time spent and reasonable hourly compensation of each attorney . . . in the presentation of the case.” (Serrano v. Priest (1977) 20 Cal.3d 25, 48 (Serrano III).) A reasonable hourly rate must reflect the skill and experience of the attorney. (Id. at p. 49.) “Prevailing parties are compensated for hours reasonably spent on fee-related issues. A fee request that appears unreasonably inflated is a special circumstance permitting the trial court to reduce the award or deny one altogether.” (Serrano v. Unruh (1982) 32 Cal.3d 621, 635 (Serrano IV).) The Court in Serrano IV also stated that fees associated with preparing the motion to recover attorneys’ fees are recoverable. (See id. at p. 624.)
Chippewa argues that Timed Out is not the prevailing party because although it sought damages in excess of $265,000 in its complaint, it recovered a mere $50,000 on the judgment entered here. (Motion at p. 8.) The standard for determining a prevailing party under Civil Code § 3344 has been described as follows:
[T]he test in statutory fee provisions that do not define “prevailing party” is to determine whether a party prevailed on a practical level by considering, among other things, the extent to which each party realized its litigation objectives. The Hsu test is substantially similar, coming into play in so-called “mixed result” cases, where the ostensibly prevailing party receives only part of the relief sought. In such cases, the trial court compares the relief awarded with the parties’ demands, as disclosed by the pleadings, trial briefs, opening statements, and other sources. Based on that, the trial court determines whether there has been a prevailing party by comparing the extent to which each party succeeded or failed in its contentions.
(Olive v. General Nutrition Centers, Inc. (2018) 30 Cal.App.5th 804, 827, internal citations omitted.)
Here, the court concludes that Timed Out was the prevailing party under this framework. Although Chippewa refers to the $265,000 demanded in the Complaint as to all six models, it neglects the $175,000 payment received for two models within its partial settlement with Prisma, and further neglects that its success at trial was more modest in part because its demands were more modest. In its closing arguments, Timed Out sought a damages award of $95,000. ((Opposition to Motion to Vacate Exh. 3 at p. 91.) Taken in this context, Timed Out has substantially achieved its litigation objectives, and is the prevailing party under this standard.
Chippewa further objects to Timed Out’s request for attorney fees on the grounds that Timed Out and Prisma colluded to put on a sham trial, while locating the onus of Prisma’s damages upon Chippewa. (Opposition at pp. 8–12.) Chippewa makes similar arguments in its motion to vacate the judgment. These arguments fail here, as they do in Chippewa’s other motion. In summary, a trial conducted after the parties execute an assignment of claims and covenant not to execute is not per se collusive. (See Safeco Ins. Co. of America v. Parks (2009) 170 Cal.App.4th 992, 1013.) Here, the settlement agreement did not obviate Prisma’s financial stake in the proceedings, and Prisma indeed mounted an adversarial defense, offering opening and closing arguments, cross-examining witnesses, and objections to evidence. Moreover, the record shows that Prisma was partially successful in its defense, reducing the damages given to Timed Out from the requested amount of $95,000 to the ultimate verdict of $50,000. Chippewa’s argument from fraud and collusion thus provides no basis to deny Timed Out’s request for fees.
Chippewa further argues that the overall amount of hours was unreasonable. It points to the declaration of its fees expert, attorney Glen Kulick, who testifies that the total amount of fees and hours sought — $504,369.00 for 1,608.1 hours of attorney and paralegal work — was unreasonable. (Kulick Decl. ¶ 13.) Kulick points to records of Timed Out filing many similar lawsuits — 78 in Los Angeles County alone since 2011 — to argue that Timed Out’s counsel should have had the benefit of templates for its pleadings and discovery that would vitiate the need for hours claimed. (Kulick Decl. ¶ 14, Exhs, 4, 5.) Kulick also argues that the apportionment of fees is insensible: 816.5 hours ($245,106) were incurred before the end of the first trial, while 791.6 hours ($258,263) were incurred between the first and second trials, when most of the pre-trial work on the second trial should have been completed prior to the first. (Kulick Decl. ¶ 13.)
Kulick identifies several items in the summary of billings submitted by Timed Out, and notes that several categories — Pretrial Preparation, Preparing Witnesses, Trial Motions, and Prepare Trial Exhibits — are interrelated, and amount to a total fee request of 803.5 hours and $236,387.50. (Kulick Decl. ¶ 27.) Kulick offers that, given the relatively simplicity of the issues in this case, $80,000 should be the maximum afforded for this work. (Kulick Decl. ¶ 27.) Kulick also opines that $122,352 for five days of trial is unreasonable, and opines that the case could have been tried by one associate and one paralegal, rather than the two associates actually employed. (Kulick Decl. ¶ 29.) Kulick concludes that a reasonable overall lodestar would be $200,000. (Kulick Decl. ¶ 30.)
Kulick’s analysis concerning the duplicative fees incurred between the first and second trials in this action is sensible. The records presented by Timed Out show its counsel intensively preparing for trial in this action up through January 2019, but immediately after a mistrial was declared on January 14, 2019, based on a family emergency of one of Prisma’s officers and witnesses, when no new trial date was yet announced, the records further reflect a re-doubling of counsel’s trial and witness preparations and revisions to same. (Motion Exh. F-1 at pp. 9–18.) Although a trial, mistrial, and second trial will naturally lead to greater expenses, the court agrees that much of the 800 hours in trial preparation in this matter were redundant, based both on the prior work performed on the first trial and the reasonable needs of the case. The court finds, based on its experience and assessment of the issues in this case, that 200 hours of trial preparation would have been reasonable. Accordingly, given an average hourly rate for this work of $294.20 ($236,387.50 divided by 803.5 hours), this results in a lodestar reduction of $177,547.50, or a lodestar award for trial preparation of $58,840.00.
The court also agrees that the amount of fees sought for expert discovery in this case — 65.7 hours or $29,390.00 (Motion Exh. F-1 at p. 8) — is excessive in light of the relative simplicity of the issues and the paucity of expert testimony ultimately utilized at trial. A more reasonable amount of hours spent on this matter would have been 20 hours, leading to a lodestar reduction of 45.7 hours at an average rate of $447.34, or $20,443.20, or a lodestar award for this work of $8,946.80.
The court disagrees, however, that the fees sought for depositions in this case —120.2 hours and $37,128.00 for eight depositions, or roughly 15 hours to prepare for and take each deposition (Motion Exh. F-1 at pp. 6–8) — are excessive, and finds that they are reasonable, when one considers not merely the time to take the depositions but to prepare therefore. Moreover, the court disagrees that the overall amounts spent at trial in these matters were excessive based on the attendance of two attorneys for Timed Out.
Chippewa also identifies several entries in Timed Out’s billing summaries that appear to relate to other cases, such as “West Coast Undercover, Inc.” and a “Princeton” matter. (Opposition at p. 13.) The summaries do reveal the inclusion of a 1.8 hour ($495) charge for preparing discovery responses to West Coast Undercover, and subsequent charges for analysis whether the discovery produced there were applicable to Prisma. (Motion Exh. F-1 at pp. 4–5.) Timed Out in reply acknowledges that the billings for West Coast are an error. (Reply at p. 13.) The court agrees that this charge is not reasonably compensable here. The summaries also show four charges from September 13, 2019, to January 3, 2020, regarding settlement of “Princeton claims,” which have no facially apparent relation to this matter. (Motion Exh. F-1 at p. 3.) However, Timed Out in reply notes that these “Princeton” charges relate to Chippewa’s insurer. (Reply at p. 13; Engel Decl. ¶ 6.) Thus these charges remain appropriate.
The court therefore GRANTS Timed Out’s motion for attorney fees and costs in the amount of $306,378.30 in fees, and $32,053.10 in costs.
Plaintiff to provide notice.
Get Deeper Insights on Court Cases