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Outrageous Attorney’s Fees of $153,525 Requested For Moderate Success in a Typical Landlord-Tenant Dispute Reduced to $10,000

When a tenant sues his landlord and apartment managers for violating the Fair Employment and Housing Act (FEHA), moderate success at trial of a typical landlord-tenant dispute does not entitle a tenant’s attorney to $153,525 in fees. Youssef v. Wheatley, No. B257828, 2015 WL 8037231 (Cal. Ct. App. Dec. 7, 2015). In Yousef, a tenant alleged several causes of action against his landlord and apartment managers after a series of unfortunate events that resulted in a physical altercation between the apartment manager and tenant. After an unsuccessful attempt by the landlord to evict the tenant based on the apartment manager’s claim that the tenant instigated the altercation, the tenant brought suit alleging violations of FEHA, conspiracy to violate his civil rights and malicious prosecution. The tenant sought compensatory damages for his emotional distress and punitive damages based on the landlord’s and managers’ malice or oppression. The California trial court directed verdicts for the defendants as to plaintiff’s claims of conspiracy, malicious prosecution, and punitive damages. The jury found the defendants liable for the FEHA violations and awarded plaintiff $5,000. Plaintiff’s attorney requested an award of $153,525 in attorney’s fees for 319.5 hours of legal work performed in this case. The trial court awarded plaintiff’s attorney a mere $10,000 after determining that the request was excessive and unjustified based on the attorney’s limited success in this routine matter.

The appellate court affirmed the trial court’s award of $10,000 in attorney’s fees explaining that courts ordinarily apply a lodestar calculation, the number of hours reasonably expended multiplied by the reasonable hourly rate, to determine reasonable attorney’s fees. However, that figure may be reduced based on case specific factors such as the nature of the litigation, its difficulty, the amount involved, the skill required to handle it, the skill actually employed, the attention given to the case, and the success or failure of the litigation. See PLCM Group, Inc. v. Drexler, 997 P.2d 511, 518 (2000).

In Youssef, the trial court noted, and the appellate court reiterated, that the attorney’s request for $153,525 was excessive based on the ordinary nature of this landlord-tenant dispute. No significant issue or public purpose was advanced in this case. The trial court properly used its discretion to reduce the lodestar calculation by limiting the time spent litigating the FEHA claims and completely excluding the plainly unsuccessful malicious prosecution claims. The trial court justified limiting the time spent litigating the FEHA claims based on excessive billing for the form complaint used to commence the action, boilerplate discovery responses, and the moderate results achieved at the three day trial. The tenant’s attorney billed six hours to prepare the form complaint and another three hours to prepare a nearly identical amended complaint. After billing seventy-three hours for “trial prep,” the tenant’s attorney also billed fourteen hours per day for the first two days of trial and twelve hours for the final day of trial even though court was in session for only six hours a day. It was unclear what the tenant’s attorney was doing for the six to eight hours following each day of trial. The appellate court affirmed the trial court’s finding that the submitted bills were “exorbitant of their face.”

The tenant’s attorney grossly overestimated the value of his case and clearly over-litigated this typical landlord-tenant dispute. Attorneys should always be mindful of the resources expended to litigate in proportion to the nature of the litigation and its difficulty. The client or opposing party should never have to pay for an attorney’s mistakes in managing and expending resources.

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