In Chavez v. City of Los Angeles (pdf), a member of the LAPD sued for discrimination and retaliation. After a tortured procedural history that spanned four years and involved actions in state and federal court and a Ninth Circuit appeal, a jury awarded the plaintiff $11,500 in damages on one of the retaliation claims. His attorney then asked the court to award $870.935.50 in attorneys’ fees. The trial court declined to award anything.
The reasoning arises from the way California state trial courts are organized. We used to have municipal courts and superior courts. Now we just have superior courts, but the cases they hear are divided up into limited civil cases and unlimited civil cases. Limited civil cases are those where the amount in controversy does not exceed $25,000. Those cases also have more streamlined procedures. Cases involving amounts of $25,000 or more are heard as unlimited civil cases.
In a civil case in California, the prevailing party is generally entitled to recover certain costs. When allowed by statute (such as California Government Code sec. 12965 which provides for fees in discrimination cases under the Fair Employment and Housing Act), the recoverable costs can include attorneys’ fees. But there’s also a rule (California Code of Civil Procedure sec. 1033(a)) that says, if you bring the case as unlimited and recover an amount that could have been awarded in a limited civil case (i.e. less than $25,000) the court decides whether you get to recover any costs.
In Chavez the trial court decided that plaintiff was not entitled to an award of attorneys’ fees because he recovered less than $25,000. Plaintiff appealed and the appellate court reversed, holding that the rule awarding attorneys’ fees to successful discrimination plaintiffs trumped the rule saying you didn’t get costs if you could have brought the action as a limited civil case. The matter went to the California Supreme Court and it sided with the trial court (unanimously). So the plaintiff’s attorney didn’t get the $870.935.50 in fees for helping the client obtain an $11,500 recovery.
It would be nice to report that the decision was based on fundamental notions of fairness, greed, or proportionality. But it wasn’t. It was based on the way our state trial courts are organized. The decision does, however, pressure plaintiff’s pursuing cases with potentially minimal damages to think carefully about where they file their claims and how much to ask for in attorneys’ fees. In this last regard, the court explained that a "grossly inflated" fees request by itself could justify denying fees altogether. I guess the message is this: You can inflate your fee request, just don’t "grossly" inflate it.