2014-00156358-CU-EI

City of Sacramento vs. State of California PERS

Nature of Proceeding:      Motion for Litigation Expenses

Filed By:    Speir, George B.

Defendant C-III Asset Management LLC’s (“C-III”) motion for litigation expenses is
GRANTED in part, as follows.

Moving counsel is admonished because the notice of motion does not provide notice
of the Court’s tentative ruling system, as required by Local Rule 1.06.  Moving counsel
is directed to contact opposing counsel forthwith and advise him/her of Local Rule 1.06
and the Court’s tentative ruling procedure and the manner to request a hearing.  If
moving counsel is unable to contact opposing counsel prior to hearing, moving
counsel is ordered to appear at the hearing in person or by telephone.

In this eminent domain action, C-III contends it is entitled to attorney fees and costs of
roughly $44,421 as a result of being dismissed by plaintiff City on 3/6/2014 and after
such fees and costs were incurred.  In support of this motion, C-III originally submitted
no billing records relative to the attorney fees claimed but rather only a summary of the
total hours billed by the attorneys working on this matter along with an allocation of
those fees 50% to the attorneys’ representation of C-III, with the other 50% being
allocated to the another party (U.S. Bank) also represented by these same attorneys in
this action.  In a supplemental declaration filed on 6/2/2014, C-III provides significantly
greater detail of the time billed by the attorneys between 1/10/2014 and 3/6/2014, half
of which are claimed on behalf of C-III.

Plaintiff City opposes the motion on various grounds.  First, City insists none of the
fees and costs allegedly incurred were either reasonable or necessary because C-III,
which did not own any interest in the subject parcels, could have and should have filed
a disclaimer at the outset, thereby obviating the need to incur any fees and costs in
connection with the eminent domain proceedings.  Second, City maintains that any
award of fees and costs should be nominal since only a small portion of the amount             claimed can be considered both reasonable and necessary, since C-III clearly had
limited “success” in this action and since C-III should not be compensated for
inefficient or duplicative efforts.  Third, City argues that there is no evidence C-III itself,
as opposed to U.S. Bank, was responsible for any of the fees incurred in connection
with the motion to change venue and the motion for prejudgment possession and that
C-III, having no true ownership interest in the subject parcels, is unreasonably claiming
one-half of the fees incurred.  Finally, plaintiff City asserts that the hourly rates quoted
by C-III (i.e., $525 for partner, $340 for associate, $200 for paralegal) are not
reasonable for legal work in the Sacramento area.

Although City is correct that C-III could have and should have filed a disclaimer based
on its lack of any legal ownership interest in the subject parcels, the Court holds that
this alone does not preclude an award of fees and costs incurred in these eminent
domain proceedings.  Still, this Court will not award fees and costs unless found to be
both reasonable and necessary under the circumstances.

Given that C-III holds no legal ownership interest in the subject parcels but merely had
a claimed “interest in the compensation to be awarded,” this Court concludes that the
50% apportionment of the fees and costs to C-III is excessive and that 25% is more
appropriate under the circumstances.  Similarly, the hourly rates at which C-III’s
attorneys billed on this matter (i.e., $525 for partner, $340 for associate, $200 for
paralegal) are unreasonably excessive for the Sacramento region and thus, C-III may
recover fees based on the following rates:  $425 for partner, $250 for associate and
$100 for paralegal.  Finally, after reviewing the billing summary provided by C-III on
6/2/2014, the Court is unable to conclude that all the fees and costs claimed by C-III
are both reasonable and necessary and thus, an additional 20% of the overall fees
claimed here are not recoverable.  In particular, the Court notes that a number of
entries found in the billing summary (1) are too vague to demonstrate precisely what
work was actually performed, (2) appear duplicative of other work found in the
summary and (3) appear to bill an unreasonably excessive amount of time for the task
described.

In the end, C-III is awarded fees and costs in the amount of $14,500.  This amount
consists primarily of 112 hours at $425 per hour for the partner, 95.6 hours at $250 per
hour for the associate and 7.4 hours at $100 per hour for the paralegal, or roughly
$72,440.  This total is then apportioned 75% to U.S. Bank and 25% to C-III, or just
over $18,000 to the latter.  $18,000 is then reduced by another 20% for billings which
the Court is unable to conclude are both reasonable and necessary, leaving C-III with
an award of $14,500.

This minute order is effective immediately.  No formal order or other notice is required.
(Code Civ. Proc. §1019.5; CRC Rule 3.1312.)