Opinion
NOT TO BE PUBLISHED
APPEAL from an order of the Superior Court of Los Angeles County, No. CA00499, Elihu M. Berle, Judge.
Edmund G. Brown, Jr., Attorney General, Dane R. Gillette, Chief Assistant Attorney General, Paul D. Gifford, Senior Assistant Attorney General, Felix E. Leatherwood, W. Dean Freeman and Diane S. Shaw, Deputy Attorneys General, for Appellants and Cross-Respondents.
Patrick G. Woosley and Frear Stephen Schmid for Plaintiff, Respondent and Cross-Appellant Charles Patrick Woosley.
Jones, Bell, Abbot, Fleming & Fitzgerald, Michael J. Abbott and Craig R. Bockman for Respondent Jones, Bell, Abbot, Fleming & Fitzgerald L.L.P.
James M. Gansinger for Respondents Gansinger Firm and the Law Offices of John F. Busetti.
Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.
I. INTRODUCTION
This appeal and cross-appeal involve attorneys’ fees and costs awarded against the State of California, acting through the Department of Motor Vehicles and State Board of Equalization (hereinafter collectively referred to as “DMV”) as a result of a 1978 class action challenging the assessment of vehicle license fees and use taxes collected on out-of-state vehicles. The 1978 action, which was brought by Patrick G. Woosley, on behalf of himself and others, alleged that the fees and use taxes violated the Commerce Clause of the United States Constitution (U.S. Const., art. I, § 8, cl. 3). The action further alleged violations of the equal protection clauses of the federal and state constitutions. The 1978 action was subsequently consolidated with a number of other cases.
On May 30, 2008, after almost 30 years of litigation, the trial court entered judgment in the class action and consolidated matters. The 2008 judgment included an award of over $23 million in attorneys’ fees and costs under a private attorney general theory as set forth in Code of Civil Procedure section 1021.5. The fees were awarded to various attorneys and law firms that had represented the class or assisted in the class action including the named plaintiff, Mr. Woosley in his capacity as an attorney. DMV has appealed from the determination that the fees were payable under the private attorney general doctrine as opposed to being paid from a common fund. DMV also appeals the amount of the attorneys’ fees and costs awarded in the final judgment. Mr. Woosley has cross-appealed from the judgment on the ground the trial court improperly reduced his lodestar hours and by only awarding him a 1.5 multiplier when class counsel received a 3.0 multiplier.
All further statutory references are to the Code of Civil Procedure unless otherwise indicated.
The fees were awarded to former and current class counsel as follows: Gansinger & Pick (class counsel from 1981 to the present) and the Estate of John F. Busetti (class co-counsel from 1979 to 1992); Jones Bell & Simpson; Gibbs, Giden, Lochner & Turner, LLP; and Mr. Woosley. Class counsel has varied over the 32 year period of this litigation due mostly to James Gansinger and the late John F. Bussetti. Both men were partners at various firms over the applicable period. For clarity, we hereinafter refer to class counsel as the Gansinger firm or class counsel. Mr. Woosley’s attorney fee request was separately asserted.
We conclude the trial court acted within its discretion to award the attorneys fees under section 1021.5 but reverse the attorney fees award and remand for further proceedings to determine the correct amount of fees that should be awarded.
II. BACKGROUND
1. The 1978 Through 1992 Litigation
As previously noted, this class action was filed in 1978. The trial court initially identified and certified two classes. The first class was a discrimination class of approximately 2.8 million people. The discrimination class was for those persons, who had from within three years prior to October 20, 1977 to the date of refund paid excess license fees or use taxes for registering vehicles that had been purchased out-of-state. The second class was identified as a “post-1976” class of about 14 million persons who since November 14, 1976 paid excess use tax on the vehicles.
In 1985, a judgment was entered in favor of the two classes. With respect to the discrimination class, the trial court determined the higher fees and use taxes violated the commerce clause of the federal Constitution and the equal protection clauses of the Constitutions of the United States and California. The trial court also concluded a second class had paid excess use taxes in violation of the Revenue and Tax Code. Based on the judgment, the trial court awarded attorney fees to: the former class counsel, Jones, Bell, Simpson and Abbott, in the amount of $1,700,000; the current class counsel, Gansinger & Pick and John F. Busetti, in the amount of $12,000,000; and Mr. Woosley in the amount of $1,000,000. The fee awards were made under the common fund principle (Serrano v. Priest (1977) 20 Cal.3d 25, 35) in light of the judgment for refunds. The 1985 judgment ordered: “That Class Counsel … recover as and for their attorneys’ fees rendered on behalf of the class, the sum of $12,000,000.00, payable out of the common fund recovered herein, ….” The judgment ordered: “That representative plaintiff Charles Patrick Woosley recover as fees for services rendered as class representative the sum $1,000,000.00, payable out of the common fund recovered herein, ….”
DMV appealed the 1985 judgment on the merits and on the class certification issue. Mr. Woosley appealed from the attorney fee award. No party appealed from the portion of the judgment determining that the fees should be paid from the common fund. Nevertheless, as shown below, both reviewing courts made some determinations about the parties’ rights concerning entitlement to and amounts of fees. But, and perhaps, understandably because no party raised the issue, neither reviewing court considered the source for payments (under common fund or private attorney general theories).
In 1990, a prior panel of this Division issued a majority opinion in which the 1985 judgment was affirmed in part; reversed in part and remanded. The Court of Appeal stated: “[Mr.] Woosley complains the court improperly based its fee award to him on a standard for a layman, rather than compensating him for the legal services he rendered to the class. It is important to note that the fact [Mr.] Woosley was not made co-counsel of record in this case does not automatically preclude him from receiving compensation for legal services; if he in fact rendered legal services to the class in connection with this case, he may be awarded fees reflecting the reasonable value of those services without being named attorney of record. [Citation.] We also note that [Mr.] Woosley’s involvement as class representative does not preclude him from recovering fees for legal services rendered to the class. [Citations.] [¶] The record gives many indications that an award to [Mr.] Woosley for legal services might have been appropriate. [Mr.] Woosley’s fee application and supporting declaration refer only to his legal work on this case. As quoted, earlier, the trial court expressly recognized that [Mr.] Woosley had ‘contributed both legally and factually’ to the case; class counsel admitted [Mr.] Woosley’s work on the case had been particularly beneficial because he is a tax specialist, and counsel for DMV expressed his awareness that [Mr.] Woosley had been acting as an attorney in the case. [¶] Yet it is unclear whether the award to [Mr.] Woosley was to compensate him for these professional services as attorney, for services as a tax specialist, for his contributions as a classic car collector, or merely for the inconveniences he suffered as class representative. The court’s assurance to him that he would be ‘perfectly, totally protected’ regarding the matter of compensation provides us with no insight, either, as to the specific services the court’s award encompassed. The record is inadequate to permit meaningful appellate review of the court’s exercise of discretion as to [Mr.] Woosley’s entitlement to an award for legal services rendered to the class. We note the original trial judge retired shortly after the entry of judgment in this action. Therefore we remand not merely to obtain an adequate record, but for the new trial judge to independently exercise his discretion on the record as to whether [Mr.] Woosley is entitled to an award for his legal services. [¶] This brings us to an additional contention in [Mr.] Woosley’s cross-appeal, that the trial court’s award to him is not supported by a record showing that it was calculated in accordance with the lodestar adjustment method required by Serrano III, supra…. [¶] To the extent the trial court determines on remand that [Mr.] Woosley is entitled to fees based on his legal services, the record must reflect the application of the lodestar adjustment method required under Serrano III for the calculation of the amount of the award. Proper analysis will require the court to first make a lodestar determination of time spent and reasonable hourly compensation for [Mr.] Woosley, and then to decide on an appropriate multiplier based on factors which include the novelty and difficulty of the questions involved in the case, the skill displayed in presenting them, and the fact that more than one law firm contributed in some share to the success of the litigation. (Serrano III, supra, 20 Cal.3d at p. 48-49.) [¶] Evaluation of these factors for [Mr.] Woosley’s legal contribution to the case may necessitate an adjustment in the valuation of other counsel’s work on the case in order that the total fees awarded in the case remain reasonable in light of the Serrano III factors. Thus, if the court decides that [Mr.] Woosley should be compensated for his legal services in this case, and if it finds that valuation of all fees are interdependent, then its determination of the amount of [Mr.] Woosley’s fees must also involve an examination and perhaps a redetermination of the fees awarded to all other counsel for the class. [Citation.] Any redetermination must, of course, include a proper calculation on the record of the lodestar and multiplier. If the trial court, in its exercise of discretion, determines that [Mr.] Woosley is not entitled to attorney’s fees, then the award of attorneys’ fees to current and former class counsel is affirmed. [¶] Current counsel challenges the propriety of any reexamination of the attorneys’ fees already awarded, arguing no appeal was taken from the award of fees to current and former counsel. The notice of appeal filed by DMV in this case was from the judgment, and the judgment included the award of attorneys’ fees. There is no jurisdictional obstacle to our consideration of this matter. The absence of any initial appellate contentions regarding the propriety of the fees to class counsel is not unexpected, considering the relative positions of the parties. DMV had no direct interest in challenging the amount awarded, since it was a ‘common fund’ award which would be paid out of the class recovery rather than by DMV. Class counsel certainly had no motivation to complain, since the trial court awarded the amount of fees requested. [Mr.] Woosley’s cross-appeal was taken on his own behalf, seeking review of the award to him for his legal services to the class; he was not acting as class representative in seeking the higher award, particularly since any increased award to him might mean additional depletion of the common fund. Given the absence of an advocate to represent the class interests on the question of the overall reasonableness of the attorneys’ fees, we find the issue was adequately preserved and properly presented by the DMV in its brief filed September 29, 1988 upon request of this court.” (Slip Opinion at pp. 47-48.)
Fourteen years after the action was filed, the California Supreme Court issued Woosley v. State of California (1992) 3 Cal.4th 758. The Supreme Court affirmed in part; and reversed in part the court of appeal decision. The matter was remanded with instructions to the trial court on reclassification and attorney fee issues. Woosley v. State of California, supra, 3 Cal.4th 758 held: “[T]he state violated the commerce clause of the United States Constitution by charging vehicle license fees for vehicles originally sold outside California, and use taxes for vehicles purchased from private parties outside California, that were higher than the fees and taxes charged on similar vehicles first sold within California. We also hold that even if the DMV violated the California Administrative Procedure Act (Gov. Code, § 11340 et seq.) when, in November 1976, it altered its practice regarding the collection of use taxes, the proper remedy for such a violation does not encompass a refund of taxes properly due under state law. Lastly, we hold the class claim filed by Woosley was not authorized by statute and thus the class on whose behalf the action is maintained may include only those persons who timely filed valid claims for refund. [¶] Accordingly, we affirm the decision of the Court of Appeal to the extent it holds that the DMV violated the commerce clause of the federal Constitution by imposing higher license fees on vehicles originally purchased in other states and higher use taxes for vehicles purchased from private parties outside California. We reverse the decision of the Court of Appeal to the extent it holds that persons who paid use taxes after November 1976, based on the actual cost of a vehicle, are entitled to refunds (because in November 1976 the DMV ceased its discriminatory practice and began to collect use taxes on all vehicles on this basis). [¶] The cause is remanded for further proceedings consistent with our opinion. In light of our holding, the Court of Appeal shall direct the trial court to amend the description of the class (1) to add to the class those persons who paid higher fees and taxes because of the DMV’s application of [Revenue and Taxation Code] section 10753.2’s depreciation schedule in a fashion different for vehicles originally purchased outside California (see fn. 15, ante, at p. 774), (2) to delete from the class those persons who paid use taxes after November 1976 (when the DMV ceased its discriminatory practice) based on the actual cost of a vehicle, (3) to delete from the class those persons who paid use taxes on vehicles purchased outside the state from a manufacturer or dealer (because the use tax collected in those circumstances equaled the sales tax collected when a similar vehicle was purchased from a manufacturer or dealer in California), and (4) to delete from the class those persons who have not timely filed a valid claim for a refund. The trial court then shall determine whether, as so defined, an ascertainable class exists for purposes of a class action.” (Woosley v. State of California, supra, 3 Cal.4th at pp. 794-795.) In light of its conclusions, the Supreme Court did not reach any issues regarding the equal protection clauses of the federal and state Constitutions. (Woosley v. State of California, supra, 3 Cal.4th at p. 783, fn. 16.)
In discussing the 1985 judgment, Woosley noted that the DMV estimated that the amount of the refund of vehicle license fees and use taxes due under the 1985 judgment exceeded $1 billion. (Woosley v. State of California, supra, 3 Cal.4th at p. 766.) The statement was made in the context of an estimate under the 1985 judgment which was substantially reduced by the Supreme Court’s decision. The Supreme Court further commented that the 1985 judgment awarded $13.7 million to class counsel and $1 million in fees to Mr. Woosley “directing that both sums be paid from the common fund recovered.” (Id. at p. 774.) “Because our opinion will result in a substantial reduction in the amount of the judgment, the trial court shall reconsider the amount of its award of attorney fees to counsel for the class and the amount of its award to Woosley ‘as fees for services rendered as class representative.’” (Id. at p. 795.) With regard to Mr. Woosley’s fees, the Supreme Court stated: “Because the parties neither have briefed nor argued the issue, we do not review, and thus leave unchanged, that portion of the decision of the Court of Appeal directing the trial court on remand to reconsider whether [Mr.] Woosley is entitled to an award of fees for the legal services he provided in connection with this matter.” (Woosley v. State of California, supra, 3 Cal.4th at p. 795, fn. 25.)
B. The Procedural History of the Case on Remand
The matter was remanded to the trial court on March 12, 1993. The trial court’s November 19, 2007, Statement of Decision explains the procedural aspects of the case since the 1993 remand. We quote extensively from the decision to show the history of the litigation between 1993 and the time the attorney fee motions were filed in 2005. As shown below, the trial court utilized the subsequent history of the case as a basis for its decision to award attorney fees and costs totaling $23.3 million under the private attorney general theory as opposed to the common fund theory. The trial court further determined that, notwithstanding the existence of the common fund, new issues such as the so-called Reclassification issue required the trial court to exercise its inherent powers to render the award not only under the private attorney general theory but also for the entire 29 year period of litigation.
The November 2007 statement of decision states the following. “55. On July 2, 1996, [Mr. Woosley] filed a motion in the trial court seeking an order redefining the class to be consistent with the decision of the Supreme Court, and determining the ascertainability of the class. [¶] 56. In 1997, the trial court consolidated the original case (No. CA000499) with subsequently filed cases No. CA001085 and No. BC165106, ‘savings’ actions filed by [Mr.] Woosley for preserving rights for time periods not covered by CA000499. [¶] 57. On April 25, 1997, the trial court... certified a class defined as: [¶]... all persons who, up to the date of refund, have filed or will file claims for refund that are not barred by the statute of limitations.’ [¶] 58. On June 2, 1997, the trial court modified the class description to exclude reference to use taxes, on the basis that [Mr. Woosley] had failed to prove numerosity as to use taxes claimants. Additionally, the class definition was modified to eliminate the words ‘or will file’ since only claims that had been filed ‘by the time of refund’ were entitled to refund. [¶] 59. The state filed a petition for writ of mandamus challenging the trial court orders on July 9, 1997. [¶] 60. On March 17, 1998, [Mr.] Woosley filed another class action complaint for refund of vehicle license fees (Case No. BC 187632), a ‘savings’ case covering a period not encompassed in the other consolidated cases.”
The November 2007 statement of decision further notes that, on August 31, 1998, Division Three of this District, issued a writ of mandamus ordering the trial court to vacate its previous orders certifying the class and enter a new order regarding a redefined certified class. (See State of California v. The Superior Court (1998) 66 Cal.App.4th 421.) The writ directed “the trial court, among other things to issue an order limiting the certified class ‘… to persons whose timely claims were rejected within the three years preceding the filing of each of the three individual cases which have been consolidated.’” In addition, State of California v. Superior Court, supra, 66 Cal.App.4th at page 431 at footnote six provides: “The trial court pointed out that the DMV had admitted that it has continued to collect fees declared unconstitutional by the Supreme Court in 1992 and had declared it had no intention of stopping the practice. The DMV estimated that it collected ‘roughly’ $1 billion in the 18 years preceding the 1992 Woosley decision, ’ and estimates that it continues to collect between $25 and $30 million a year in unconstitutional fees.” (State of California v. Superior Court, supra, 66 Cal.App.4th at p. 431.)
The November 2007 statement of decision continued with the following post-remand history. “63. On January 26, 1999, [Mr.] Woosley filed a further class action complaint for refund of vehicle license fees (Case No. BC 204297), another ‘savings’ case covering a period not encompassed within the previously filed cases. [¶] 64. On March 1, 1999, the trial court issued an order redefining the classes in consolidated cases CA000499, CA001085, BC 165106, and certifying mandatory relief classes. [¶] 65. On June 18, 1999, [Mr.] Woosley filed an additional class action complaint for refund of vehicle license fees (Case No. BC 212235), yet another ‘savings’ case covering a period not included in earlier actions. [¶] 66. Case Nos. BC 187632, BC 204297 and BC 212235, filed in 1998 and 1999, involve facts and claims identical to those of the previously consolidated cases of CA00499, CA001085 and BC 165106, and were filed as ‘savings cases’ for time periods not covered by previously filed cases. [¶] 67. Pursuant to a trial management order issued in September 1999, trial of the consolidated cases was bifurcated…. Liability issues under the First Amended Consolidated Complaint were ordered to be tried in the first phase; and amounts of individual damage claims of members were left to be determined in a second phase.”
The November 2007 statement of decision outlined subsequent trial court orders on liability from June 2000 as follows. “[¶] 68. After trial on the issues of liability in the first phase, the trial court issued its statement of decision on June 28, 2000, concluding, among other things, the following: [¶] a. [DMV’s] discrimination against vehicles originally purchased or previously registered outside of California violates the Commerce Clause of the United States Constitution. [¶] b. [DMV’s] starting the depreciation schedule on California vehicles with the year the vehicle was sold new, while starting the depreciation schedule on used nonresident vehicles with the year of purchase by the person registering the vehicle in California, violates the Commerce Clause of the United States Constitution when such practice causes the nonresident vehicle owner to pay higher fees than that charged on a comparable California vehicle. [¶] c. [DMV’s] continuing to charge vehicle license fees on nonresident vehicles that were purchased prior to August 1, 1991, and registered in California prior to that date, in the same way after the 1991 amendments [to Revenue and Taxation Code section 10735, subdivision (a) requiring the DMV to re-determine the market value of a vehicle based on its actual costs upon its sale as a used vehicle] as they charged prior to the 1991 amendments violates the Commerce Clause. [¶] d. [DMV’s] imposing vehicle license fees, in the same way after the 1991 amendments as imposed prior to the 1991 amendments on nonresident vehicles that were purchased prior to August 1, 1991, and registered in California prior to that date violates the Commerce Clause. [¶] e. [DMV’s] imposing vehicle license fees on nonresident vehicles that were purchased prior to August 1, 1991, first registered in California after that date, and not resold after that date, based on the cost price to the person registering the vehicle in California, while imposing vehicle license fee[s] on California vehicles that were purchased prior to August 1, 1991, and not resold after that date, based on the cost price paid by the original purchaser of the vehicle as the new vehicle, violates the Commerce Clause. [¶] f. In view of the court’s ruling based upon violation of the Commerce Clause of the United States Constitution, it is not necessary for the court to decide whether the discrimination on the imposition of vehicle license fees by the [DMV] on nonresident vehicles as compared to California vehicles also violates the Equal Protection, Due Process and Privileges and Immunities Clauses of the United States Constitution and the Equal Protection Clause of the State Constitution. [¶] 69. The trial court ordered: [¶] a. [DMV] to cease any discriminatory treatment against owners of nonresident vehicles by charging vehicles license fees on nonresident vehicles greater than that currently being charged on comparable California vehicles. [¶] b. [DMV] to cease any discriminatory treatment of owners of nonresident vehicles purchased prior to August 1, 1991, that are registered in California after that date. Such owners of nonresident vehicles must be afforded the same treatment as owners of comparable California vehicles. [¶] c. [DMV] to determine which owners of nonresident vehicles purchased prior to August 1, 1991, are being overcharged vehicle license fees, based on the stipulated Common Class Index. This court further ordered that the Common Class Index be used to determine refund amounts on timely, valid claims for refund of vehicle license fees. [¶] d. [Mr. Woosley] and all other class members who overpaid vehicle license fees on nonresident vehicles prior to August 1, 1991, the date that Revenue and Taxation Code sections 10753 and 10753.2 were amended, are entitled to refunds based on the Supreme Court’s ruling in Woosley v. State of California (1992) 3 Cal.4th 758. [¶] e. [Mr. Woosley] and all other class members who overpaid vehicle license fees after August 1, 1991, on nonresident vehicles that were purchased prior to August 1, 1991 and registered in California prior to that date are entitled to refunds pursuant to the Supreme Court’s ruling in Woosley v. State of California (1992) 3 Cal.4th 758. [¶] f. [Mr. Woosley] and all other class members who overpaid vehicle license fees after August 1, 1991, on nonresident vehicles that were purchased prior to August 1, 1991, and first registered in California after that date are entitled to refunds pursuant to the Supreme Court’s ruling in Woosley v. State of California (1992) 3 Cal.4th 758.”
On July 24, 2000, pursuant to the parties’ stipulation, the trial court entered an order consolidating for all purposes Case Nos. BC 187632, BC 204297, and BC 212235 with previously consolidated Case Nos. BC 000499, CA 001085 and BC 165106.
On January 2, 2001, the trial court entered an order certifying a refund class in Case No. BC 212235. The class was defined as “‘All persons who (1) were charged and paid more license fees for registration of vehicles first purchased or previously registered or titled outside of the State of California than they would have paid if the vehicles had been first purchased, registered or titled in the State of California, or [¶] (2) were charged and paid higher license fees because of the [DMV’s] application of [Revenue and Taxation Code] section 10753.2’s depreciation schedule in a fashion different for vehicles originally purchased outside of California, and [¶] (3) who filed a timely claim for refund from January 31, 1997 through June 18, 1999 which was not barred by the statute of limitations.’” The January 2, 2001 order noted that Mr. Woosley withdrew class certification motions in case Nos. BC 187632 and BC 204297 as unnecessary given that case No. BC 212235 covered all claims that had been filed up to and including June 18, 2000 that are not covered by case Nos. CA000499, CA001085 and BC 165106. This was because the court had amended the class definition in the previously consolidated cases to include a mandatory relief class comprised of all the current owners.
On May 18, 2001, trial court granted Mr. Woosley’s request for summary adjudication in case No. BC 212235 and dismissed the remaining claims as duplicative and moot. In granting summary adjudication, the trial court stated: “The central undisputed fact in this litigation is that the [DMV] continued during the period covered by this action the same discriminatory treatment of nonresident vehicles that have not been resold outside of a family group since 1991. [¶] [California law] provides that all vehicles that are resold on or after August 1, 1991, be reevaluated on resale. If there is no resale on or after August 1, 1991, the value of the vehicle for vehicle license fee purposes does not change, except for depreciation. California vehicles that have not been resold since August 1, 1991, are not revalued except for depreciation applied under a depreciation schedule. However, some nonresident vehicles that come into California on or after August 1, 1991, are treated as if they have been resold and are given a market price based on cost price to purchaser. This different manner of assessment results in many nonresident vehicle owners paying higher license fees than the owners of comparable California vehicles. [¶] The California Supreme Court, in the lead case herein, Woosley v. State of California (1992) 3 Cal.4th 758, affirmed the trial court ruling that the difference in the way that license fees are calculated between California vehicles and nonresident vehicles violated the Commerce Clause of the United States Constitution. [¶] On June 28, 2000, this court entered its Statement of Decision in consolidated cases [CA00049], CA001085 and BC 165106 the (“Statement of Decision”). In that Statement of Decision, this court found that [DMV] had continued to employ the same method to compute vehicle license fees due on vehicles originally purchased out of state that the Supreme Court held was unconstitutional in Woosley. [¶] In the case at bar, it is undisputed that the facts and claims pled in [CA00049], CA001085 and BC 165106 [which were the subject cases in the Statement of Decision] are the same facts and claims pled in BC 212235. The only differences are that (1) BC 212235 covers claims filed in the time period from January 21, 1997, to June 18, 1999, and (2) BC 212235 does not seek affirmative relief as to current owners of non-resident vehicles which are the subject of discrimination.”
The November 2007 statement of decision further noted that between 2001 and 2006 the parties engaged in a number of efforts to determine and notify specific class members and to establish a claims procedure. In addition, between 2001 and 2006, there were a number of court hearings with regard to the procedures.
C. The 2005 Attorney Fee Motions
On remand, class counsel and Mr. Woosley filed two separate attorney fee motions. On December 27, 2005, class counsel James M. Gansinger filed a motion for attorney fees and costs “on behalf of Gansinger & Pick, the Law Offices of John F. Busetti, Jones Bell & Simpson and Gibbs Giden Locher & Turner, LLP.” The fees were sought pursuant to section 1021.5 under a private attorney general theory. Counsel argued that the fees should not be awarded under the common fund doctrine but under the private attorney general theory. They argued: the public policy vindicated by the action was of constitutional stature; the action conferred a significant benefit on the public at large by bringing an end to a discriminatory scheme that impacted thousands of California taxpayers for over 30 years; section 10753 of the Revenue and Taxation Code was amended in 1991 due to the litigation to end future liability to the state from the commerce clause violations; private enforcement was necessary to stop the public transgressor; and the refund class should not be required to pay attorney fees. According to counsel, a common fund was generated for the refund class but in June 2000, the trial court entered an order in favor of a reclassification class. The reclassification class did not have a fund generated but rather obtained relief from being overcharged vehicle license fees. So, there is no common fund from which the attorney fees could be paid.
Class counsel argued that lodestar was the appropriate method to calculate the fees and adjusted by a positive multiplier consistent with Serrano v. Priest, supra, 20 Cal.3d 25. It was argued that the lodestar was complicated due to the length of the litigation. Class counsel cited the 1985 judgment in which the trial court had adopted the lodestar figure. Counsel then provided evidence of the hours spent by various individual attorneys and law firms based on a current hourly rate in December 2005 of $350 an hour. Counsel argued the fees and hourly rate were reasonable even for contentions or motions which had been lost. Class counsel suggested alternative multipliers ranging from 2 to 7 percent. But, it was asserted that a multiplier in the range of 5 to 6 was reasonable.
In support of the class action motion, Mr. Gansinger declared that records for time done on the case through 1985 had been produced for inspection and copying during the initial fee application in 1985. The hours worked are set forth in a letter to Judge Lester Olson, which was attached to the 2005 motion as exhibit 8. The records for the 1978 through 1985 time period were subsequently produced and attached as an exhibit to Mr. Gansinger’s supplemental declaration dated October 6, 2006.
Mr. Gansinger stated, however, that no records for the appellate period between 1985 and 1992 existed. This was because class counsel had represented to Judge Olsen that, if class counsel received approximately $12 million in attorney fees, counsel would not seek any further fees for the appellate work. When the trial court awarded $12 million class counsel did not keep any records of the appellate time between 1985 and 1992. The fee application for the 1985 through 1992 period was based on a reconstruction of the records. Mr. Gansinger was deposed about the reconstructed records. Because Mr. Busetti was deceased, the Administrator of his estate, Janice L. Feinstein reconstructed the time he spent working on the case during the time period between 1985 through 1991. Ms. Feinstein is an attorney and is Mr. Busetti’s widow. The records after the remand were also reconstructed for the time period from 1992 through June 2, 1996 and the period from March 10, 1998 through July 2000. Detailed records were provided for the time period from July 2000 through the fee application.
Mr. Busetti died in November 1991.
Mr. Woosley filed a motion for attorney fees pursuant to section 1021.5. According to Mr. Woosley, on remand, the trial court was directed to consider whether he should receive attorney fees not only as a class counsel but because he was a tax attorney. He argued that the Supreme and Appellate Courts opinions concerning his fees were law of the case on this issue. The object of the litigation to end $450 million to $1.2 billion in interstate commerce discrimination had been achieved. He reiterated arguments in class counsel’s briefs about the litigation in achieving statutory amendments and a reclassification of thousands of vehicles. Mr. Woosley asserted that his skills as a tax attorney complemented class counsels’ civil litigation skills, specifically Mr. Gansinger and the late Mr. Busetti. Mr. Woosley offered evidence of his extensive tax background. With regard to this litigation, Mr. Woosley researched and developed the equal protection claim. Although the equal protection claim initially prevailed in the trial court, neither the Supreme Court nor the Appellate Court considered the issue. Mr. Woosley also listed his conduct in practical and legal matters concerning the class action on a number of tangential matters that were not related to the class action itself. He offered expert declarations suggesting that he was entitled to a multiplier of up to seven percent. He requested a multiplier of six percent on the lodestar amount $4,589,943 for services other than the 2005 fee application plus a lodestar of $61,920 for the 2005 fee claim.
D. The DMV’s Threshold Motions
The DMV responded to the attorney fee motions by filing two motions to strike. The first motion was made on the grounds the judgment entered on July 1, 1985 awarding attorney fees payable out of a common fund was final and class counsel knowingly and voluntarily waived the attorney fees on appeal. The second motion was a threshold motion against Mr. Woosley.
1. The Motion to Strike Class Counsel Fee Request
In the motion to strike brought against class counsel, DMV asserted that class counsel was seeking to convert their $13.7 million common fund attorney fee award into a private attorney general award of in excess of $25,381,020. DMV noted that when the initial fee application was made in June 1985, class counsel sought attorney fees under three theories: common fund, substantial benefit and private attorney general. However, Mr. Gansinger stated in a declaration that the common fund theory “provides a solid and unassailable basis for an award of fees in this case.” DMV responded to the 1985 fee application by opposing the amount of the fees but not the common fund theory. The trial court awarded class counsel a total of $13.7 million for work done through the appeal “payable out of the common fund created herein.” The motion to strike reminded the trial court that DMV appealed from the 1985 judgment. However, neither the DMV nor class counsel appealed the attorney fee award. Mr. Woosley appealed his entitlement to fees but not the common fund theory. DMV noted that the appellate court, in resolving Mr. Woosley’s appeal, stated that an adjustment might be necessary “in the valuation of other counsel’s work on the case in order that the total fees awarded in the case remain reasonable.” However, the appellate court did not require or authorize the trial court to re-compute the source or amount of the previous award. DMV further argued that the Supreme Court did not review Mr. Woosley’s entitlement to fees or the source for payment.
In addition, DMV contended that class counsel had waived their right to recover attorneys’ fees for legal services rendered on appeal from 1985 through 1992. Counsel was requesting a total amount of $7,085,400 from $1,180,900 with a 6 multiplier for the applicable appellate period. DMV cited a portion of Mr. Gansinger’s declaration as a concession that the fees had been waived. In paragraph 192 of his declaration offered in support of the 2005 fee application, Mr. Gansinger stated: “… Mr. Busetti and I had represented to the trial court during the fee application process in 1985 that if the trial court awarded to us fees that were substantially in the amount requested, that we would not seek any further fees for the expected appellate work that would follow.” DMV argued that, in accordance with the intent to waive the fees, counsel did not maintain any records for their appellate work between 1985 and 1992. Counsel also did not file an attorney fee request for their appellate work within 40 days after issuance of the remittitur by the appellate court on May 12, 1993. (Cal. Rules of Court, rule 3.1702 formerly rule 870.2 adopted eff. Jan. 1, 1994.) Counsel assumed the risk that the Supreme Court would not overturn the judgment and agreed to waive the appellate fees in exchange for a $12 million fee award.
Further references to Rules are to the California Rules of Court.
Class counsel responded that the common fund theory was not binding. The private attorney general theory was asserted in the 1985 fee application. The 1992 Supreme Court decision did not require application of the common fund theory. The common fund theory should not be applied because the refund class members would bear the costs even though hundreds of thousands of other taxpayers received a significant benefit from the litigation. No fund was generated for this class of persons. The trial court has inherent equitable power to award private attorney general fees. The 1985 judgment has to be entirely redone. Class counsel did not waive attorney fees from the 1985 through 1992 appeal process. No payment was made based on the 1985 judgment and the Supreme Court directed a reconsideration of the fee award. To the extent DMV was willing to pay $13.7 million, then class counsel would not seek any work for the time between 1985 and 1992. Because the 1985 judgment was reversed, former rule 870.2 is inapplicable.
2. The Threshold Motion Against Mr. Woosley
DMV made a threshold motion to deny as untimely Mr. Woosley’s application for fees for the period prior to June 4, 1985. DMV asserted that Mr. Woosley had not complied with former rule 8702. DMV noted that former rule 870.2 did not exist prior to January 1994 but was applicable rendering the motion about 11 years too late.
DMV also moved for a determination that Mr. Woosley cannot be awarded attorney fees and costs for any period after his motion to be appointed class counsel was denied on June 4, 1985. DMV pointed out the following facts. Mr. Woosley filed a motion to be substituted as additional class counsel on May 21, 1985. The trial court denied the motion on June 4, 1985 and reconsideration on August 8, 1985. Mr. Woosley filed a similar motion in the appellate court on November 25, 1985, which was denied on December 10, 1985. Mr. Woosley renewed his motion on December 26, 1985, which the appellate court denied on January 13, 1986. The Supreme Court denied his writ of mandate petition on February 13, 1986. DMV argued that Mr. Woosley did not explain how his attorney fee request complied with the remand instructions on whether he was to receive fees for his services as an attorney rather than as a class representative.
Mr. Woosley opposed the threshold motions on the following grounds. DMV was ignoring the benefits to the public from the $1 billion discriminatory practices ended by the litigation. The fees awarded in the 1985 were not calculated on the basis of the percentage of the common fund created. The fees were calculated on the basis of lodestar with a multiplier of 13; the 2005 fee request contains a reduction of a multiplier of five to six.
Mr. Woosley raised the source of fees and the private attorney general theory by his notice of appeal which states that he was appealing “from that portion of the judgment entered in the above-entitled action on July 1, 1985, which denied the plaintiff’s motion for Attorney Fees for assistance to Class Counsel of record herein, and which awarded him fees only as Class Representative.” He argued that the trial court did not award him attorney fees from the common fund nor did the reviewing courts limit the theory of recovery. No party had to appeal the common fund theory. The attorney fees were not severable from but highly dependent on the case in chief. It was established in 1999 or 2000 that the recovery fund was so small that the trial court could allow the award under the private attorney general theory.
E. The Attorney Fee Award
In the November 2007 statement of decision, the trial court determined that all the requirements of section 1021.5 had been established. The court concluded the litigation vindicated the important public policy of the commerce clause. The lawsuit conferred a significant benefit on the general public by bringing “an end to a program of discrimination that directly impacted hundreds of thousands of California taxpayers every year for over 30 years; a scheme that [DMV] has admitted cost California taxpayers over $1 billion by 1992.” DMV has stopped the discriminatory practice. The taxpayers who filed a valid and timely claim will receive a refund of the illegally assessed taxes plus interest. The litigation was a catalyst for the changes in Revenue and Taxation Code section 10753 between 1983 and 1991. The financial burden requirement was met because Mr. Woosley as an individual would gain only about $500 in vehicle license fees. Class counsel had “already expended millions of dollars in time-based charges and expenses to support the public benefit.”
The trial court concluded that the “interest of justice” requirement was established by the record. In deciding the interest of justice did not require that the common fund pay the attorney fees, the trial court stated: “The common fund created by the litigation is the sum of money, plus interest, due to Refund Class members who have filed timely and valid claims for refunds. In court proceedings, [DMV’s counsel has] estimated that the total amount of the refund in this matter would be approximately $2 million…. Although the Refund Class members will clearly benefit from the results achieved in this litigation, these refund recipients represent only a small fraction of the taxpayers and others who have benefited from this litigation. It would not be fair to require the Refund Class members to bear a disproportionate share of the cost of the litigation simply because their claims generated a fund of money. [¶] …. Aside from Refund Class members, there are also members of the Reclassification Class who benefited from these consolidated actions. The Reclassification Class members were those taxpayers who were still being wrongfully assessed unlawful and discriminatory license fees when this court entered its June 2000 Statement of Decision. The Reclassification Class members have all had their vehicles reclassified pursuant to this court’s ruling so that they will never again be overcharged vehicle license fees. Every one of these Reclassification Class members has received a direct monetary benefit from this litigation; that is, relief from being overcharged illegal fees in the future. Because the financial benefit was in the form of monies that will not have to be paid by taxpayers in the future, the financial benefit did not create a ‘common fund’ from which attorneys’ fees and costs could be paid. [¶] … Additionally, there are hundreds of thousands of taxpayers who benefited from the 1983 and 1991 changes in the law that came about because of this litigation. The 1983 change to Revenue and Taxation Code, section 10753 was the first step in eliminating the challenged discrimination. [DMV has] acknowledged that ‘the changes in 1983 came after an apparent legislative examination of the lawsuit…..’ [¶] … The 1991 change to Revenue [and] Taxation Code section 10753 halted illegal discrimination as to all vehicles that changed hands after 1991. This legislative change was referred to by the DMV as the ‘Woosley Fix’ because it was designed to eliminate most, but not all, of the continuing discrimination denounced by the Court of Appeal in its 1990 decision…. [¶] … In this consolidated action, [DMV] admitted that the amount stake in the litigation as of 1985 was in excess of $1 billion…. [T]he State Department of Finance, in connection with the 1991 proposed amendments to Revenue and Taxation Code, section 10753, advised the Governor that the amount at stake ‘could be over $1 billion in use tax and $750 million in vehicle license fees.’”
In light of these findings, the trial court issued a statement of decision awarding a total of $23.3 million in attorneys’ fees and costs. The award consisted of: $15,308,147 in fees and $173,862 in costs to class counsel Mr. Gansinger (and his various law firms) and Mr. Busetti’s estate; $7,330,234 in fees and $142,550 in expenses to Mr. Woosley; and $547,657 to Jones, Bell, Abbott, Fleming and & Fitzgerald (a prior firm of Mr. Gansinger). The trial court entered judgment on May 30, 2008. On August 1, 2008, DMV filed a timely appeal from the judgment. (Rule 8.104.) Mr. Woosley filed a timely cross-appeal on August 20, 2008. (Rule 8.108(f).)
III. DMV’S APPEAL
A. Attorney Fees Prior to the 1985 Judgment
As a threshold matter, the parties disagree as to whether the trial court erred in awarding fees generated prior to the 1985 judgment under the private attorney general doctrine pursuant to section 1021.5 rather than under the common fund doctrine.
Section 1021.5 was enacted to codify the court-developed private attorney general doctrine. (Vasquez v. State (2008) 45 Cal.4th 243, 250; Woodland Hills Residents Assn., Inc. v. City Council (1979) 23 Cal.3d 917, 913.) Section 1021.5 provides in part: “Upon motion, a court may award attorneys’ fees to a successful party against one or more opposing parties in any action which has resulted in the enforcement of an important right affecting the public interest if: (a) a significant benefit, whether pecuniary or nonpecuniary, has been conferred on the general public or a large class of persons, (b) the necessity and financial burden of private enforcement, or of enforcement by one public entity against another public entity, are such as to make the award appropriate, and (c) such fees should not in the interest of justice be paid out of the recovery, if any.” An award under section 1021.5 must meet the statutory requirements of having “‘a successful party’” in an action which “‘resulted in the enforcement of an important right affecting the public interest.’” (Vasquez, v. State, supra, 45 Cal.4th at pp. 250-251.) In addition, there must be a showing of all three statutory conditions: a significant benefit conferred on the general public or a large class of persons; the necessity and financial burden of private enforcement such that the award is appropriate; and “such fees should not in the interest of justice be paid of the recovery, if any.” (§ 1021.5; Vasquez, v. State, supra, 45 Cal.4th at pp. 250-251.) “The doctrine rests on the recognition that privately initiated lawsuits, while often essential to effectuate important public policies, will as a practical matter frequently be infeasible without some mechanism authorizing courts to award fees. [Citations.] Accordingly, ‘“the fundamental objective of the doctrine is to encourage suits enforcing important public policies by providing substantial attorney fees to successful litigants in such cases.”’ [Citations.]” (Vasquez v. State, supra, 45 Cal.4th at p. 250.) The trial court’s decision under section 1021.5 is reviewed for an abuse of discretion. (Vasquez, v. State, supra, 45 Cal.4th at p. 250-251; Graham v. DaimlerChrysler Corp. (2004) 34 Cal.4th 553, 560.) But, whether statutory requirements for a statutory award have been met amounts to statutory construction which presents a legal question. (Connerly v. State Personnel Bd. (2006) 37 Cal.4th 1169, 1175; Carver v. Chevron USA, Inc. (2002) 97 Cal.App.4th 132, 142.)
Serrano v. Priest, supra, 20 Cal.3d 25 described the common fund doctrine as follows: “‘[O]ne who expends attorneys’ fees in winning a suit which creates a fund from which others derive benefits, may require those passive beneficiaries to bear a fair share of the litigation costs.’ [Citation.]” (Id. at p. 35.) The common fund theory is derived from “‘the historic power of equity to permit the trustee of a fund or property, or a party preserving or recovering a fund for the benefit of others in addition to himself, to recover his costs, including his attorneys’ fees, from the fund or property itself or directly from the other parties enjoying the benefit.’ [Citation.]” (Serrano v. Priest, supra, 20 Cal.3d at p. 35; Abouab v. City and County of San Francisco (2006) 141 Cal.App.4th 643, 662.) “The bases of the equitable rule which permits surcharging a common fund with the expenses of its protection or recovery, including counsel fees, appear to be these: fairness to the successful litigant, who might otherwise receive no benefit because his recovery might be consumed by the expenses; correlative prevention of an unfair advantage to the others who are entitled to share in the fund and who should bear their share of the burden of its recovery; encouragement of the attorney for the successful litigant, who will be more willing to undertake and diligently prosecute proper litigation for the protection or recovery of the fund if he is assured that he will be promptly and directly compensated should his efforts be successful. [Citations.]” (Estate of Stauffer (1959) 53 Cal.2d 124, 132; see also Jordan v. California Dept. of Motor Vehicles (2002) 100 Cal.App.4th 431, 446.) “The common fund doctrine is applicable only where plaintiffs’ efforts have effected the creation or preservation of an identifiable fund of money out of which the fees will be paid.” (Jordan v. California Dept. of Motor Vehicles, supra, 100 Cal.App.4th at pp. 446-447, citing Serrano v. Priest, supra, 20 Cal.3d at pp. 37-38.)
The dispute here is whether the trial court properly awarded the attorney fees under the private attorney general theory rather than under the common fund. On the one hand, the DMV asserts the fees should have been awarded from the common fund as set forth in the 1985 judgment. On the other hand, class counsel asserts the trial court acted within its discretion to award the fees under the private attorney general theory. The issue is whether the trial court was precluded from awarding section 1021.5 because of the common fund portion of the 1985 judgment. There are no cases directly on point, but there are some cases which provide some guidance on this issue.
One such case is Beasley v. Wells Fargo Bank (1991) 235 Cal.App.3d 1407, disapproved on a different point in Olson v. Automobile Club of Southern California (2008) 42 Cal.4th 1142, 1151. In Beasley, Wells Fargo Bank argued that attorney fees should not be awarded under section 1021.5 when class action litigation has yielded a common fund recovery. The appellate court rejected the contention that the existence of the common fund precluded an award of attorney fees by analyzing the statutory factors of section 1021.5. Beasley concluded: “If the estimated value of a class action common fund recovery, determined as of the time the vital litigation decisions were being made, does not exceed actual litigation costs by a substantial margin, the financial burden of private enforcement is such as to make it appropriate to award attorney fees under section 1021.5. In contrast, if estimated value is substantially more than actual litigation costs, there should be no award under section 1021.5 unless public benefits are very significant.” (Beasley v. Wells Fargo Bank, supra, 235 Cal.App.3d at p. 1415.) Beasley further concluded the interests of justice criterion did not require payment from the common fund because “even if the estimated value of the case is viewed as exceeding the actual litigation costs by a substantial margin, the public benefits from the litigation [in the Beasley case were] so significant that an award of fees under section 1021.5 is appropriate.” (Beasley v. Wells Fargo Bank, supra, 235 Cal.App.3d at p. 1417.)
Rider v. County of San Diego (1992) 11 Cal.App.4th 1410 was a taxpayer action challenging the validity of a retail transaction and use tax imposed by a county agency. After our Supreme Court determined the tax was invalid, the matter was remanded for consideration of some collateral issues such as the payment of attorney fees under the private attorney general doctrine. (Id. at pp. 1414-1415, 1422-1424.) Rider concluded the attorneys were entitled to payment of their fees from the common fund because the “interest of justice” prong of section 1021.5 was not met. The conclusion in Rider was based on two factors: both sides of the litigation had acted in good faith to uphold the public’s interest in seeking to establish the correct interpretation and application of the constitutional principles; and the final conclusion of the Supreme Court on the constitutionality of the tax was not a clear, obvious or foregone conclusion. (Id. at pp. 1422-1423.) Rider concluded: “These two factors lead us to conclude that the ‘interest of justice’ mandates the payment of the Taxpayers’ attorney fees from the recovered fund of invalidly collected supplemental sales tax revenues rather than from the general funds of the [public entities].” (Id. at p. 1423.) Under these circumstances, the common fund theory was found to be “a precise ‘fit’” for payment of attorney fees from the recovery of the invalidly collected supplemental sales tax revenues at issue. (Ibid.) This is consistent with the rationale of a common fund to award fees “out of a fund recovered or maintained by the plaintiff, on the theory that all who will participate in the fund should pay the cost of its creation or protection and that this is best achieved by taxing the fund itself for attorney fees.’ [Citation.]” (Rider v. County of San Diego, supra, 11 Cal.App.4th at p. 1423 quoting Serrano v. Priest, supra, 20 Cal.3d at p. 35, fn. 5.)
In Bank of America v. Cory (1985) 164 Cal.App.3d 66, taxpayers brought an action against the State Controller for enforcement of the state’s unclaimed property law (§ 1500 et seq.) against banks which failed to turn over accounts to the State. (Id. at pp. 71-72.) The trial court concluded that the requirements of both the common fund doctrine and the private attorney general were met. However, the trial court concluded that the interests of justice required application of section 1021.5 because the common fund generated by the litigation might be inadequate to pay both the owners of the funds and the attorney fees. The appellate court concluded: “The error in the trial court’s reasoning was the belief the fund could be reduced by claims to the extent the fund remaining would be inadequate to pay the award of attorney fees. The bases of the common fund doctrine are ‘[f]airness to the successful litigant, who might otherwise receive no benefit because his recovery might be consumed by the expenses; correlative prevention of an unfair advantage to the others who are entitled to share in the fund and who should bear their share of the burden of its recovery; and encouragement of the attorney for the successful litigant, who will be more willing to undertake and diligently prosecute proper litigation for the protection or recovery of the fund if he is assured that he will be promptly and directly compensated should his efforts be successful.’ [Citations.] Those benefiting from the recovery of the fund, in this case some depositors and eventually the People of the State of California, must bear their share of the cost of litigation. Fees for taxpayers’ attorneys will be deducted from the judgment, and each claimant’s share reduced proportionately. To the extent the judgment relies upon section 1021.5 for recovery of attorney fees, it must be modified to confine the award of fees to the common fund theory.” (Id. at pp. 90-91.)
What can be gleaned from these authorities (Beasley, Rider and Cory) is the existence of the common fund is pertinent to the determination of whether attorney fees can be awarded under the private attorney general doctrine. Here, the trial court determined that the existence of the common fund did not preclude the award. This conclusion is consistent with Beasley v. Wells Fargo Bank, supra, 235 Cal.App.3d at pages 1415 through 1417.
However, at first glance, it appears that there is some merit to the contention the size of the common fund may have controlled a portion of the trial court’s determination. To the extent that the attorney fee award may have been predicated upon the size of the common fund award it is inconsistent with Bank of America v. Cory, supra, 164 Cal.ApP.3d at pages 90 through 91. Stated another way, the trial court could not base its determination solely on the fact that the common fund which had been generated was insufficient to pay the refunds and attorneys fees.
Moreover, an additional issue exists because the 1985 judgment determined the common fund would be the source of the attorney fees. According to DMV, because no party appealed from that portion of the judgment as to the source of payment, the issue should not have been revisited on remand. DMV relies on American Enterprises, Inc. v. Van Winkle (1952) 39 Cal.2d 210, to support is contention that the portion of the 1985 judgment determining the source for payment of the attorneys fees was the common fund has long been final. American Enterprises, Inc. v. Van Winkle, supra, discussed severable judgments as follows: “The basic question, therefore, is the scope of review upon a partial appeal. The answer lies in a determination as to whether that portion specified in the notice of appeal is severable from the remainder of it. The well recognized rule is that there may be an appeal from a part of a judgment only if that part is severable. [Citations.] Where portions of a judgment are truly severable, the appellate court is without jurisdiction to consider the parts from which no appeal has been taken. [Citations.] And the appellate court will consider the portion before it independently of the other parts. [Citations.] Modification or reversal of the portion of the judgment from which the appeal has been taken has no effect upon the other portions. [Citations.] [¶] The test of whether a portion of a judgment appealed from is so interwoven with its other provisions as to preclude an independent examination of the part challenged by the appellant is whether the matters or issues embraced therein are the same as, or interdependent upon, the matters or issues which have not been attacked. [Citations.] ‘[I]n order to be severable, and therefore appealable, any determination of the issues so settled by the judgment... must not affect the determination of the remaining issues whether such judgment on appeal is reversed or affirmed.... Perhaps another way of saying it would be that the judgment is severable when the original determination of those issues by the trial court and reflected in the judgment or any determination which could be made as the result of an appeal cannot affect the determination of the remaining issues of the suit....’ [Citation.]”
Here, the question is whether the attorney fee award was truly severable from the remaining portion of the judgment. Class counsel and Mr. Woosley assert that the attorney fee award was not truly severable because both reviewing courts considered the aspects of the attorney fee award. They also argue that the amount of the fees is not severable from the source of payment because the issues were interwoven or interdependent. In addition, they contend that the Supreme Court’s instructions did not preclude the trial court from considering a different theory of recovery. The problem with this analysis is that the 1985 judgment determined that the attorney fees were to be paid from a common fund. The Supreme Court remanded the matter for reconsideration of the amount of attorney fees after concluding “[its] opinion will result in a substantial reduction in the amount of the judgment.” We, thus, disagree with class counsel and Mr. Woosley that the Supreme Court’s silence on this issue must be interpreted as acquiescence. Because no party appealed from that portion of the 1985 judgment, there is some merit to the claim that the source of payment of attorney fees should not have been revisited on remand at least insofar as any fees generated between 1978 and 1992.
The problem arises in this case because the parties did not simply comply with the Supreme Court’s instructions on remand. Rather, after remand, the parties began a new and protracted round of litigation that lasted from 1993 until 2008 when the judgment was finally entered. We agree with class counsel and Mr. Woosley that the source and amount of fees were interdependent and interwoven under the unique circumstances of this case. This is because of the following factors. The Supreme Court affirmed the commerce clause claim. The Supreme Court reversed that portion of the judgment relating to attorney fees and ordered the trial court on remand to reconsider the fees awarded to class counsel and to Mr. Woosley. The Supreme Court did not place any restriction on the legal theory under which fees could be awarded. Class counsel’s 1985 fee application requested fees under the private attorney general theory. The Supreme Court ordered the trial court to re-define the class, which required the entry of a new and different judgment. The matter was then litigated vigorously for almost two decades. During the subsequent litigation, two classes were certified, the refund and reclassification class members. Additional “savings class” actions were filed and consolidated with the 1978 class action. A common fund was created for the refund class members from the original class. But, no common fund was generated for the reclassification class members. The reclassification class was certified, apparently due to DMV’s admission that it continued to collect taxes, $25 to $30 million per year, in an unconstitutional manner notwithstanding the Supreme Court’s decision in Woosley v. State, supra, 3 Cal.4th 758. DMV’s practices ended only after entry of the June 2000 Statement of Decision.
Furthermore, the trial court concluded the evidence showed hundreds of thousands of taxpayers in the reclassification class had benefited from the refund class’s litigation. But, there was no common fund set aside to benefit the reclassification class members. The common fund method is not applicable “where plaintiffs’ efforts have not effected the creation or preservation of an identifiable “fund” of money out of which they seek to recover their attorneys’ fees.” (Serrano v. Priest, supra, 20 Cal.3d at pp. 37-38; accord Lealao v. Beneficial California, Inc. (2000) 82 Cal.App.4th 19, 39.) The trial court considered it not in the interests of justice to make the refund class pay the attorney fees under the circumstances. As the trial court noted, “In view of the fact that the Refund Class members are but a small fraction of the individuals, entities, and society in general that have benefited from this litigation, it would not be in the interest of justice for the limited fund created for the benefit of the Refund Class members to bear the cost of attorneys’ fees and costs expended in this litigation.” As a result, to the extent there was a common fund generated by the initial litigation, the trial court did not abuse its discretion in determining “such fees should not in the interest of justice be paid out of the recovery, if any.” (§ 1021.5, subd. (c).)
B. The Adequacy of the Records
The DMV asserts that class counsel did not support the attorney fee request with adequate records for certain time periods. Mr. Gansinger did not maintain any records for the period between 1985 through 1992. According to Mr. Gansinger, the records were not maintained because counsel had received a $12 million attorney fee award with the 1985 judgment. Mr. Gansinger agreed that class counsel would not seek attorney fees on appeal given the attorney fee award from the 1985 judgment. Mr. Gansinger also had lost substantial portions of records between 1992 and 2000. Mr. Woosley did not attach any records to his original motion. However, he subsequently produced documents in discovery. Mr.Woosely stated that records from the time period between 1978 through 1985 had been lost.
With respect to Mr. Woosley, DMV asserts that the failure to maintain and submit contemporaneous time records should have been a basis to deny any request for fees. DMV’s expert Mr. Greenfield opined that the lack of records should result in a 653.68 hour deduction for Mr. Gansinger. The trial court’s calculation of a reasonable fee award is committed to its discretion; and the determination of the value of the services may be made “contrary to, or without the necessity for, expert testimony.” (PCLM Group v. Drexler (2000) 22 Cal.4th 1084, 1096; Melnyk v. Robledo (1976) 64 Cal.App.3d 618, 623-624.) The trial court’s attorney fee award must be based on a “careful compilation of the time spent and reasonable hourly compensation of each attorney … involved in presentation of the case.” (Serrano v. Priest, supra, 20 Cal.3d at p. 48; accord Chavez v. City of Los Angeles (2010) 47 Cal.4th 970, 985; Ketchum v. Moses (2001) 24 Cal.4th 1122, 1131-1132.) However, California allows fee awards even in the absence of detailed and contemporaneously recorded time sheets. (Chavez v. Netflix, Inc. (2008) 162 Cal.App.4th 43, 64 [detailed time sheets are not required of class counsel to support a fee award]; Wershba v. Apple Computer, Inc. (2001) 91 Cal.App.4th 224, 254-255 [under oath evidence is sufficient basis for attorney fee award]; Best v. California Apprenticeship Council (1987) 193 Cal.App.3d 1448, 1470 [the preferred practice is for the attorney to keep contemporaneously recorded time sheets but it is not required].) The time spent was reconstructed and attested to by attorneys under oath. (Margolin v. Regional Planning Com. (1982) 134 Cal.App.3d 999, 1006-1007; see also Wershba v. Apple Computer, Inc, supra, 91 Cal.App.4th at pp. 254-255.) The issue then was nothing more than a factual question subject to a review for sufficiency of the evidence. The trial court’s determinations are supported by a sufficient evidentiary record. No further documentation concerning the time charged is necessary to defeat DMV’s inadequate record claim.
C. The Reasonableness of the Award
DMV asserts that the fees awarded to Mr. Gansinger and to Mr. Woosley were excessive and unreasonable. In California, the lodestar method requires the trial court to first determine a touchstone or lodestar, which is the number of hours reasonably expended multiplied by a reasonable hourly compensation for each attorney. (Ketchum v. Moses, supra, 24 Cal.4th at p. 1134, PCLM Group, Inc. v. Drexler, supra, 22 Cal.4th at p. 1095; Serrano v. Priest, supra, 20 Cal.3d at p. 48.) The trial court may then adjust the lodestar figure upward or downward by taking various “relevant factors” into account. (Chavez v. City of Los Angeles, supra, 47 Cal.4th at p. 970; Ketchum v. Moses, supra, 24 Cal.4th at p. 1132; Serrano v. Priest, supra, 20 Cal.3d at p. 48.)
In Serrano v. Priest, supra, 20 Cal.3d at page 49, the California Supreme Court identified the relevant factors in that case as follows: “Among these factors were: (1) the novelty and difficulty of the questions involved, and the skill displayed in presenting them; (2) the extent to which the nature of the litigation precluded other employment by the attorneys; (3) the contingent nature of the fee award, both from the point of view of establishing eligibility for an award; (4) the fact that an award against the state would ultimately fall upon the taxpayers; (5) the fact the attorneys in question received public and charitable funding for the purpose of bringing law suits of the character here involved; (6) the fact that the monies awarded would inure not to the individual benefit of the attorneys involved but the organizations by which they are employed; and (7) the fact that in the court’s view the two law firms involved had approximately an equal share in the success of the litigation.” The Supreme Court has also noted: “The ‘lodestar adjustment method of calculating attorney fees set forth in Serrano III is designed expressly for the purposes of maintaining objectivity.’ [Citation.] The trial judge ultimately has discretion to determine the value of the attorney services. ‘However, since determination of the lodestar figure is so “[f]undamental” to calculating the amount of the award, the exercise of that discretion must be based on the lodestar adjustment method.’ [Citation.]” (Maria P. v. Riles, supra, 43 Cal.3d at p. 1295 quoting Press v. Lucky Stores Inc. (1983) 34 Cal.3d 311, 324.) This approach ties the trial court’s analysis to an objective determination of the value of the services so that the amount awarded is not arbitrary. (Ketchum v. Moses, supra, 24 Cal.4th at p. 1134; PCLM Group, Inc. v. Drexler, supra, 22 Cal.4th at p. 1095.) Ultimately, though ‘“[t]he experienced trial judge is the best judge of the value of services rendered in his court, and while his judgment is of course subject to review, it will not be disturbed unless the appellate court is convinced that it is clearly wrong.”’” (Ketchum v. Moses, supra, 24 Cal.4th at p. 1132.)
DMV argues that the lodestar amount should have been adjusted downward to reflect the relationship between the amount awarded and the results obtained as consistent with the standard set forth by the United States Supreme Court decision of Hensley v. Eckerhart (1983) 461 U.S. 424, 440. Hensley involved an attorney fee award under 42 U.S.C. § 1988. In Hensley, the Court stated: “We hold that the extent of a plaintiff’s success is a crucial factor in determining the proper amount of an award of attorney’s fees under 42 U.S.C. § 1988. Where the plaintiff has failed to prevail on a claim that is distinct in all respects from his successful claims, the hours spent on the unsuccessful claim should be excluded in considering the amount of a reasonable fee. Where a lawsuit consists of related claims, a plaintiff who has won substantial relief should not have his attorney’s fees reduced simply because the district court did not adopt each contention raised. But where the plaintiff achieved only limited success, the district court should award only that amount of fees that is reasonable in relation to the results obtained.” (Id. at p. 440.) The United States Supreme Court emphasized that the inquiry does not end with a finding that plaintiff obtained significant relief, but the award may be reduced if the relief “is limited in comparison to the scope of the litigation as a whole.” (Ibid.)
The fundamental policy of the private attorney general doctrine as codified in section 1021.5 “‘is to encourage suits enforcing important public policies by providing substantial attorney fees to successful litigants in such cases.’” (Maria P. v. Riles, supra, 43 Cal.3d at pp. 1288-1289; accord Graham v. DaimlerChryler Corp., supra, 34 Cal.4th at p. 565.) In order to effectuate the fundamental policy, the courts must take “a broad, pragmatic view of what constitutes a ‘successful party.’” (Graham v. DaimlerChryler Corp., supra, 34 Cal.4th at p. 565; Riverwatch v. County of San Diego Dept. of Environmental Health (2009) 175 Cal.App.4th 768, 782-783.) Thus, it has been consistently held that “‘an attorney fee award may be justified even when Plaintiff’s legal action does not result in a favorable final judgment.’” (Graham v. DaimlerChryler Corp., supra, 34 Cal.4th at p. 565 quoting Westside Community for Independent Living, Inc. v. Obledo (1983) 33 Cal.3d 348, 352; see also Press v. Lucky Stores, Inc., supra, 34 Cal.3d at pp. 316-325; Northington v. Davis (1979) 23 Cal.3d 955, 960; Woodland Hills Residents Assn., Inc. v. City Council, supra, 23 Cal.3d at p. 938; Riverwatch v. County of San Diego Dept. of Environmental Health, supra, 175 Cal.App.4th at pp. 782-783.) Moreover, an attorney fee award may be made even if the party does not prevail on all claims. (See Riverwatch v. County of San Diego Dept. of Environmental Health (2009) 175 Cal.App.4th 768, 782-783 citing Harbor v. Deukmejian (1987) 43 Cal.3d 1078, 1103.) “The critical fact is the impact of the action not the manner of its resolution.” (Folsom v. Butte County Assn. of Governments (1982) 32 Cal.3d 668, 685; Riverwatch v. County of San Diego Dept. of Environmental Health, supra, 175 Cal.App.4th at pp. 782-783.) Nevertheless, under California standards the attorney fees are recoverable for all hours “reasonably spent” unless special circumstances would make it unjust to render the award. (Serrano v. Unruh (1982)32 Cal.3d 621, 633.) In exercising its discretion, the trial court “‘must realistically assess the litigation and determine, from a practical perspective, whether or not the action served to vindicate an important right so as to justify an attorney fee award’ under section 1021.5. [Citation.]” (Maria P. v. Riles, supra, 43 Cal.3d at pp. 1290-1291.) The trial court’s exercise of discretion includes the ability to include or exclude from the lodestar any time spent on unsuccessful legal theories. (See Harman v. City and County of San Francisco (2007) 158 Cal.App.4th 407, 426 [excluded]; Sokolow v. County of San Mateo (1989) 213 Cal.App.3d 231, 250 [excluded]; Sundance v. Novato Unified School Dist. (1987) 192 Cal.App.3d 268, 273 [included].) Furthermore, lack of success is a factor, which should be considered by the court in determining the amount of a reasonable attorney fee award. (Meister v. Regents of the University of California (1988) 67 Cal.App.4th 437, 454; Californians for Responsible Toxics Management v. Kizer (1989) 211 Cal.App.3d 961, 974-975.)
Here, DMV claims the trial court did not properly consider the lack of success in the action. DMV’s expert estimated that half of the time claimed from Mr. Gansinger (4, 473 hours) and half of the time claimed by Mr. Woosley (3, 483.58 hours) should have been deducted from the lodestar due to the unsuccessful theories. DMV asserts the lodestar should have been reduced by the lack of success consistent with the substantial reduction in the 1985 judgment after the Supreme Court’s 1992 decision and directions on remand. Mr. Woosley obtained a judgment in 1985 which would have generated an estimated $800 million fund based on a discriminatory use tax. But, the California Supreme Court ruled “no refund in use taxes is required, because the amount of the use taxes collected was due the state under applicable tax statutes.” (Woosley v. State of California, supra, 3 Cal.4th at p. 783.) Consistent with its holding, our Supreme Court directed the trial court to reconsider the attorneys’ fees in light of the “substantial reduction in the amount of the judgment”.
No doubt, the trial court considered the amount of success ultimately obtained in this case in very large degree. But, the trial court’s November 2007 Statement of Decision does not reflect any consideration of the loss of the bulk of the original case. Furthermore, the record shows that a substantial amount of time was spent on the unsuccessful efforts relating to the use tax which had been reversed on appeal. After careful review of the record, we are persuaded that the record does not support the conclusion that the trial court gave any consideration to the lack of success in this case. There is no satisfactory explanation for the failure to consider the lack of success in this case. As one court explained: “[T]he degree or extent of appellants’ success in obtaining the results which they sought must be taken into consideration in determining the extent of attorney fees which it would be reasonable for them to recover. As so clearly set forth by the United States Supreme Court in Hensley v. Eckerhart, supra, although the trial court has discretion to make this equitable judgment of determining the amount of a fee award, it must provide ‘a concise but clear explanation of its reasons for the fee award, ’ making clear that it has considered the relationship between the amount of the fee awarded and the results obtained, and awarding only that amount of fees that is reasonable in relation to the results actually obtained.” (Sokolow v. County of San Mateo, supra, 213 Cal.App.3d at p. 248 quoting Hensley v. Eckerhart, supra, 461 U.S. at p. 437.)
By everyone’s estimate, the 1985 judgment was reduced by about $800 million to approximately $2 million. But the trial court’s statement of decision does not address the lack of success caused by the reversal of over $800 million from the original judgment. Thus, not all of the results being sought in this case were obtained e.g. a refund of over $800 million to the taxpayers. Indeed, that portion of the 1985 judgment has not existed since 1992. Not only that, the record reflects, among other things, that time was spent before and after the 1992 decision unsuccessfully: petitioning for certiorari to the United States Supreme Court: Mr. Woosley (118.20 hours) and Mr. Gansinger (25 hours); arguing the merits of the equal protection claim: Mr. Woosley (206.10 hours) and Mr. Gansinger (104.30 hours); and time spent on a refund plan which included providing funds to an inappropriately defined class: Mr. Woosley (552.50 hours) and Mr. Gansinger (119.95 hours).
In sum, the record does not show that the trial court made or considered any adjustment for the lack of success of the case. Given the reversal of an $800 million judgment and the Supreme Court’s instructions on remand, it was an abuse of discretion not to do so.
D. Time Claimed by Mr. Woosley
DMV claims the award must be reduced because the record shows that the court did not make any specific adjustments on the lodestar for unnecessary and duplicative work. The lodestar figure is based upon “‘the careful compilation of the time spent and reasonable hourly compensation.’” (Ketchum v. Moses, supra, 24 Cal.4th at pp. 1132 quoting Serrano v. Priest, supra, 20 Cal.3d at p. 48.) However, in determining what is reasonable, a trial court must carefully review attorney documentation of hours expended and make appropriate adjustments for “padding” for inefficient and duplicative efforts, which are never subject to compensation. (Ketchum v. Moses, supra, 24 Cal.4th at p. 1132; Serrano v. Priest, supra, 20 Cal.3d at p. 48; Komarova v. National Credit Acceptance, Inc. (2009) 175 Cal.App.4th 324, 348.) The lodestar is then adjusted by other factors in the lawsuit. In other words, the lodestar calculation must be based on “the actual hours counsel has devoted to the case, less those that result from inefficient or duplicative use of time.” (Horsford v. Board of Trustees of California State University (2005) 132 Cal.App.4th 359, 395 citing Ketchum v. Moses, supra, 24 Cal.4th at p. 1132.)
Here, the trial court specifically found that Mr. Woosley had over-litigated a number of matters including the attorney fee motion. The trial court also found that Mr. Woosley’s efforts were duplicative. According to the trial court, Mr. Woosley claimed to have spent over 13, 174.25 hours litigating the case and 1, 489.65 hours litigating the fee motion. By contrast, the total time spent by other counsel is 12, 036.05 with a claim of 442.3 hours on the fee application. The trial court deducted from Mr. Woosley’s request: 130.45 hours (time spent litigating between counsel); and 58.90 hours (time spent working on other cases); and 2, 616.50 hours (time spent in self representation). The trial court noted that a downward adjustment of compensable hours was appropriate, under standards in Thayer v. Wells Fargo Bank (2001) 92 Cal.App.4th 819, 840-842 and California Common Cause v. Duffy (1987) 200 Cal.App.3d 730. After the noted deductions, the trial court concluded that Mr. Woosley had claimed 10, 367.45 hours. The trial court found the time claimed to be “excessive hours that were unnecessarily expended in overdoing or overworking the case, [and] duplicative of class counsel efforts.” This included billing at attorney rates for work that could have been done by attorneys or paralegals at lower billing rates. The trial court concluded that “not all the hours expended by [Mr.] Woosley on this matter were reasonably and necessarily spent.” However, the trial court determined that it would not make any deduction for duplicative hours. This is because the 29-year history and the recorded hours made it “extremely difficult to determine with any exactitude the number of duplicative/ overworked excessive hours.” Instead, the trial court chose to utilize the duplication and padding for an adjustment on the lodestar multiplier. The trial court then awarded Mr. Woosley a total lodestar value of $4,840,156 consisting of a billable value of $2,649,432 for 10, 367.45 hours with a 7 per cent interest rate factor for delay in payment. Noting the excessive amount of fees requested for the attorney fee motion, the trial court awarded Mr. Woosley 200 hours at $350 per hour or $70,000. Notwithstanding the record showing the padding and excessive fee requests, the trial court then awarded a 1.5 multiplier to the lodestar figure. The trial court stated: “Based upon the complex, unique and difficult issues in this case; the special expertise and skill of counsel; the results achieved; the risks undertaken; the preclusion of counsel from taking other work; and the additional consideration that a portion of [Mr.] Woosley’s work was duplicative of the work of other counsel or otherwise excessive; the court finds in its discretion that a multiplier of 1.5 of [Mr.] Woosley’s lodestar is appropriate.”
The trial court’s award cannot be upheld under the aforementioned circumstances. This is because Mr. Woosley was not entitled to compensation in the lodestar figure for padded fees due to duplicative and/or inefficient efforts. (Ketchum v. Moses, supra, 24 Cal.4th at p. 1132; Serrano v. Priest, supra, 20 Cal.3d at p. 48; Komarova v. National Credit Acceptance, Inc., supra, 175 Cal.App.4th at p. 348; Premier Medical Management Systems, Inc. v. California Ins. Guarantee Assn. (2008) 163 Cal.App.4th 550, 556.) The time for duplicative and inefficient efforts is not only unreasonable it is not compensable. Under the circumstances, we cannot conclude that all hours sought and obtained by Mr. Woosley were reasonably spent. The making of an award when there is no “reasonable basis” for it is an abuse of judicial discretion. (See Thayer v. Wells Fargo Bank, N.A., supra, 92 Cal.App.4th at p. 844 citing Ketchum v. Moses, supra, 24 Cal.4th at pp. 1133-1134.)
Furthermore, the record shows the trial court erred in not deducting time for the duplicative work but in choosing to consider the duplication in the enhancement of the lodestar. In exercising its discretion, the trial court cannot “intertwine considerations relevant to the lodestar amount with factors relevant to whether the lodestar should be adjusted upward.” (Northwest Energetic Services, LLC v. California Franchise Tax Bd. (2008) 159 Cal.App.4th 841, 879-880; Ramos v. Countrywide Home Loans, Inc. (2000) 82 Cal.App.4th 615, 625; Flannery v. California Highway Patrol (1998) 61 Cal.App.4th 629, 647.) Stated another way: “[T]he exercise of that discretion must be based on a proper utilization of the lodestar adjustment method, both to determine the lodestar figure and to analyze the factors that might justify application of a multiplier. Whether an award is justified and what amount that award should be are two distinct questions, and the factors relating to each must not be intertwined or merged.” (Flannery v. California Highway Patrol, supra, 61 Cal.App.4th at p. 647 citing Press v. Lucky Stores, Inc., supra, 34 Cal.3d at pp. 322-324.) While the trial court certainly had discretion to determine the value of the services, the record clearly shows that no adjustment to the lodestar figure was made in this case for duplicative and excessive hours. Instead, the trial court improperly intertwined or merged the two distinct questions of lodestar figure with the justification of a multiplier. This was done, notwithstanding the trial court’s own findings that Mr. Woosley’s litigation efforts were duplicative and excessive. Indeed, once there is a showing of duplicative and inefficient efforts a negative multiplier may be the remedy. (See Thayer v. Wells Fargo Bank, N.A., supra, 92 Cal.App.4th at pp. 844-845.) Depending on the circumstances (including the amount of hours worked which were duplicative and excessive), Mr. Woosley may not have the right any enhancement of the lodestar figure. (Ibid.) It may also be that a negative multiplier for the lodestar is warranted taking into account the contributions of class counsel as well as any failure to satisfactory explain the basis of duplicative work. (Ibid.)
In sum, the lodestar award for Mr. Woosley must be reversed because it was based on all the hours Mr. Woosley claimed when the trial court found that there was duplicative and excessive work. Duplicative and excessive work is neither reasonable nor compensable.
E. The Expenses Awarded to Mr. Woosley
DMV claims that the trial court abused its discretion in awarding Mr. Woosley $142,550 in expenses. Because DMV’s claim is not supported by any authority or legal analysis, it is deemed without foundation and requires no further discussion. (Levin v. Ligon (2006) 140 Cal.App.4th 1456, 1486; In re S.C. (2006) 138 Cal.App.4th 396, 408; Dabney v. Dabney (2002) 104 Cal.App.4th 379, 384.) However, due to the reversal for other considerations, the expenses may be reduced in accordance with the views expressed in this opinion.
F. The Motion to Deny Mr. Woosley’s Fee Application
DMV claims that the trial court should have granted the motion to deny Mr. Woosley’s fee application for the pre-1985 judgment period as untimely pursuant to the version of former rule 870.2 (renumbered as rule 3.1702), which was effective January 1, 1994. This is because the matter was remanded in 1990 by the court of appeal for determinations as to whether he was entitled to any fees, and if so, in what amount. (Woosley v. State of California (1990) 266 Cal.Rptr. 385, 401.) DMV further argues that the motion should have been denied for any period after his motions to be named as counsel were denied.
1. Mr. Woosley’s attorney fee application was timely.
As enacted in 1994, former rule 870.2 provided in part: “(a) [Applicability] Except as otherwise provided by statute, this rule applies in civil cases to claims for statutory attorney fees and claims for attorney fees provided for in a contract. Subdivisions (b) and (c) apply when the court determines entitlement to the fees, the amount of the fees, or both, whether the court makes that determination because the statute or contract refers to ‘reasonable’ fees, because it requires a determination of the prevailing party, or for other reasons. [¶] (b) [Trial court attorney fees] A notice of motion to claim attorney fees for services up to and including the rendition of judgment in the trial court shall be served and filed within the time for filing a notice of appeal under [former] rules 2 and 3. The parties may, by stipulation filed before the expiration of the above time, extend the time for filing a motion for attorney fees until 60 days after the expiration of the time for filing a notice of appeal or, if a notice of appeal is filed, until the time within which a memorandum of costs must be served and filed under [former] rule 26(d). For good cause, the trial judge may extend the time for filing a motion for attorney fees in the absence of a stipulation, or for a longer period than allowed by stipulation.”
DMV asserts that the trial court should not have considered any request for pre-1985 judgment attorney fees because Mr. Woosley did not file any request for the fees within 60 days of January 1, 1994. Former rule 2 (currently rule 8.104) provides that the notice of appeal must be filed: 60 days after the clerk files notice of entry of judgment; 60 days after party serves entry of judgment; or 180 days after entry of judgment. The time limit for filing attorney fees applies to all motions which are effective after the statute was enacted even though there was no section limitation when the underlying judgment was entered. (Save Our Forest & Ranchlands v. County of San Diego (1996) 50 Cal.App.4th 1757, 1764.) This includes an attorney fee motion brought under section 1021.5. (Save Our Forest & Ranchlands v. County of San Diego, supra, 50 Cal.App.4th at p. 1761; see also Crespin v. Shewry (2004) 125 Cal.App.4th 259, 269-270; Sanabria v. Embrey (2001) 92 Cal.App.4th 422, 426-429.) The procedural requirements for obtaining statutory fees are not jurisdictional but they are mandatory. (Lee v. Wells Fargo Bank, N.A. (2001) 88 Cal.App.4th 1187, 1197-1198; Russell v. Trans Pacific Group (1993) 19 Cal.App.4th 1717, 1725-1726.) But, failure to comply with the statutory time limits under rule 870.2 can be relieved by the court’s exercise of its broad discretion pursuant to section 473. (Lee v. Wells Fargo Bank, supra, 88 Cal.App.4th at p. 1198; Save Our Forest & Ranchlands v. County of San Diego, supra, 50 Cal.App.4th at p. 1761.) However, the time limits for filing an attorney fee motion do not run until entry of a judgment at the conclusion of the litigation. (Carpenter v. Jack In The Box Corp. (2007) 151 Cal.App.4th 454, 462-468; see also Crespin v. Shewry, supra, 125 Cal.App.4th pp. 270-271.)
Here, the court of appeal reversed the 1985 judgment for a determination of what the amount of any fees, if any, Mr. Woosley was entitled to receive. The Supreme Court affirmed that portion of the court of appeal decision concerning Mr. Woosley. However, the Supreme Court remanded the matter for reconsideration of fees in light of the substantial reduction of the judgment. Thus, there was no final judgment between the parties so section former section 870.2 was inapplicable to this case in 1994. (§ 577; In re Marriage of Freeman (2005) 132 Cal.App.4th 1, 9; Crespin v. Shewry, supra, 125 Cal.App.4th at pp. 270-271.)
2. DMV has failed to establish that Mr. Woosley was not entitled to fees.
DMV further argues that Mr. Woosley was not entitled to fees for the period after the trial court denied his May 1985 motion to be added as class counsel on or around June 4, 1985. DMV has not cited any authority or legal analysis to support the position. We choose not to develop the arguments on this issue and deem the contention to be without foundation. (Levin v. Ligon, supra, 140 Cal.App.4th at p. 1486; In re S.C., supra, 138 Cal.App.4th at p. 408; Dabney v. Dabney, supra, 104 Cal.App.4th at p. 384.)
G. The Gansinger Firm Appellate Attorney Fees
DMV contends the trial court should have granted its motion to strike time sought by the Gansinger firm consisting of 3, 374 hours spent during the appeals from the 1985 judgment until 1992. This is because the attorneys agreed to waive any appellate fees if the trial court granted their fee application for $13.7 million fee in the 1985 judgment. According to DMV the waiver was never conditioned upon payment of the fees. Due to the 1985 judgment providing for waiver, class counsel did not keep records and DMV did not appeal the fee award. The Supreme Court’s reversal of the 1985 judgment was a risk that class counsel assumed before waiving the right.
DMV has failed to establish that the trial court erred in determining there was no waiver based on the facts of this case. The record shows that, as part of the 1985 judgment, the trial court awarded the Gansinger law firm $13.7 million from the common fund in exchange for an agreement not to seek appellate fees on review. There was no evidence that any such payment was ever received by the Gansinger law firm. But, DMV asserts that payment of $13.7 million was not a condition precedent to the waiver of the right to collect appellate court fees. However, the record does not support the claim that class counsel either expressly or impliedly voluntarily agreed to waive appellate fees in the event that there was no $13.7 million payment. Thus, the trial court’s finding there was no waiver is supported by substantial evidence and must be upheld. (St. Agnes Medical Center v. PacifiCare of California (2003) 31 Cal.4th 1187, 1196; Platt v. Pacific, Inc. v. Andelson (1993) 6 Cal.4th 307, 319; National Farm Workers Service Center, Inc. v. M. Caratan, Inc. (1983) 146 Cal.App.3d 796, 803.)
H. The Multipliers
DMV asserts the trial court should not have awarded a 1.5 multiplier to Mr. Woosley and a 3 multiplier to the Gansinger firm. In determining whether to enhance the lodestar figure, our Supreme Court indicated the trial court consider the following factors: “(1) the novelty and difficulty of the questions involved, and the skill displayed in presenting them; (2) the extent to which the nature of the litigation precluded other employment by the attorneys; (3) the contingent nature of the fee award, both from the point of view of establishing eligibility for an award; (4) the fact that an award against the state would ultimately fall upon the taxpayers; (5) the fact the attorneys in question received public and charitable funding for the purpose of bringing law suits of the character here involved; (6) the fact that the monies awarded would inure not to the individual benefit of the attorneys involved but the organizations by which they are employed; and (7) the fact that in the court’s view the two law firms involved had approximately an equal share in the success of the litigation.” (Serrano v. Priest, supra, 20 Cal.3d at p. 49.) The factors are only illustrative and not exhaustive. (In re Lugo (2008) 164 Cal.App.4th 1522, 1545; Thayer v. Wells Fargo Bank, supra, 92 Cal.App.4th at p. 834.) However, in order to avoid “improper double counting”, a trial court is directed to “not consider these factors to the extent they are already encompassed within the lodestar.” (Ketchum v. Moses, supra, 24 Cal.4th at p. 1138.)
In a separate part of this opinion, we have concluded that on remand the trial court should consider whether Mr. Woosley is entitled to any enhancement at all due to the trial court’s findings that his contributions to the case were duplicative and excessive in numerous instances. Moreover, we concluded that the trial court’s failure to consider the lack of success concerning the reversal of an $800 million judgment in favor of the public as a result of the California Supreme Court’s 1992 decision was an abuse of discretion. The trial court obviously was impressed with the aspect of the litigation which ended the discriminatory practice. Nevertheless, the trial court completely ignored the fact that, after the 1992 loss, the case went from an estimated $800 million common fund case to a $2 million common fund case. While there was a benefit to the public from the 2000 decision directing the DMV to end the discriminatory practice, no common fund was ever established regarding a use tax class. Neither class counsel nor Mr. Woosley was successful in that regard. Thus, on remand consideration should be given to the lack of success in this key aspect of the case.
I. The Interest Rate Plus a Multiplier
DMV asserts that the trial court should not have awarded interest on the attorney fee award. DMV challenges the trial court’s interest award on the grounds: the lodestar was enhanced by a 7 per cent interest rate and then a multiplier was applied to the interest enhanced lodestar amount; an interest award plus a multiplier is a double recovery; no interest should have been applied to the hours spent collecting the fees; and no interest should have been awarded on the expenses.
We begin by noting no party has cited any authority which establishes the right to prejudgment interest on an attorney fee award under section 1021.5. A similar issue was considered with regard to a request under Civil Code section 3287 based on a statutory attorney fee award made pursuant to section 1021.6 (for indemnity). (See Bear Creek Planning Com. v. Title Ins. & Trust Co. (1985) 164 Cal.App.3d 1227, 1248 disapproved on a different ground in Bay Development, Ltd. v. Superior Court (1990) 50 Cal.3d 1012, 1032, fn. 12.) In rejecting the right to interest on the statutory attorney fee award made under section 1021.6, Bear Creek Planning Com. stated: “The interest thereon was awarded pursuant to section 1021.6, …, presumably as prejudgment interest. But prejudgment interest is defined as ‘interest that may be awarded on the claim from the time it was originally due until the time of judgment.’ [Citation.] [Its] purpose is to compensate a party for money detained during the period of time from the accrual of the claim to the judgment. An award of prejudgment interest presupposes the prevailing party was entitled to the payment of an amount of money, whether liquidated or unliquidated, on a certain date prior to the judgment. [¶] Plaintiff, had no prejudgment ‘entitlement’ to attorney fees under section 1021.6. Such fees are allowed only by virtue of the statute, which by its language vests discretion within the trial court to determine whether or not to award such fees. Once the court decides to award fees, it is further within its discretion to fix a reasonable amount, after considering factors such as the nature of the litigation, its difficulty, the amount involved, the skill required, the skill employed, the attention given, the success or failure, and the attorney’s skill and learning. [Citations.] The right to recover attorney fees under section 1021.6 ‘vests’ and the amount is fixed only when the trial court grants a motion for such fees. Interest is allowable only from that date. (Civ.Code, § 3287, subd. (a).) The award is the same as the usual judgment award wherein the prevailing party is entitled to interest from the date the decision is made or rendered. (Code Civ.Proc., § 1033.)” (Bear Creek Planning Com. v. Title Ins. & Trust Co., supra, 164 Cal.App.3d at pp. 1248-1249.) Likewise, here, there was no right to any fixed amount of fees until the trial court granted the section 1021.5 motion. Under the reasoning of Bear Creek Planning Com., interest was not allowable until the date of the decision granting the attorney fees.
Furthermore, contrary to class counsel’s assertions, we are not persuaded that language in Graham v. DaimlerChryler Corp., supra, 34 Cal.4th 553, requires a different result. The trial court concluded that the delay of 29 years from the time the action was filed until the time the motion was filed warranted an interest adjustment to the lodestar for passage of time. This conclusion was based on language in Graham taken from a discussion about an enhancement of the lodestar for delay in payment. Our Supreme Court stated: “One enhancement factor that would be as applicable for fees on fees as for fees on the merits is a significant delay in the payment of the fees. [Citation.] ‘Court-awarded fees normally are received long after the legal services are rendered. That delay can present cash-flow problems for the attorneys. In any event, payment today for services rendered long in the past deprives the eventual recipient of the value of the use of the money in the meantime, which use, particularly in an inflationary era, is valuable. A percentage adjustment to reflect the delay in receipt of payment therefore may be appropriate.’ [Citation.] But this enhancement, which is tantamount to an interest rate, is by itself quite small and may be reduced or eliminated if the lodestar rate is based on the present hourly rate rather than the lesser rate applicable when the services were rendered. (Graham v. DaimlerChrysler Corp. 34 Cal.4th at pp. 583-584.) We are not persuaded that the language in Graham discussing an enhancement factor for delay is equivalent to a right to a 7 per-cent interest rate on the lodestar figure. Graham neither discusses nor establishes the right to an interest enhancement on the lodestar figure. Instead, because there was no determination of either entitlement or amount of attorney fees until the trial court granted the section 1021.5 motion, no interest was recoverable on the fees prior to entry of the award.
J. The Arguments Raised By Mr. Woosley On Appeal
Mr. Woosley raises a number of issues as the respondent on appeal. He claims major portions of DMV’s opening brief on appeal should be stricken because it lacks record and legal citations. We have chosen to deem the arguments without foundation wherever appropriate. Similarly, because Mr. Woosley failed to cite applicable authority for the contention that we should strike DMV’s opening brief on appeal as untimely, we deem the argument without foundation. However, as Mr. Woosley notes, the court’s docket shows that there was no copy of an April 7, 2009 default notice served on DMV’s counsel in the court’s file. Thus, the timeliness issue on its face lacks merit.
IV. MR. WOOSLEY’S CROSS-APPEAL
Mr. Woosley raises a number of issues concerning the trial court’s award of attorney fees to him in his cross-appeal. We do not address any issues necessarily decided against Mr. Woosley based on DMV’s appeal.
A. The Deduction of 2616.5 Hours Based On His Own Benefit
Mr. Woosley argues the trial court should not have deducted 2, 616.5 hours for time he spent on the appeal from 1985 through 1990 related to his fee application and his $2,000 tax refund. Mr. Woosley asserts that there is no substantial evidence to support the duplication finding. Mr. Woosley also contends: DMV’s expert declaration lacked foundation; the fact that he sought a $2000 tax refund did not justify the exclusion of thousands of hours of time spent for the benefit of the class; DMV did not produce substantial evidence of duplication; he proved that there was no duplication; a number of exhibits attached to the expert declarations do not support the claims; and the trial court compounded the error by deducting 2616.5 hours when DMV requested only a 981 deduction. We have determined in DMV’s appeal the duplication issue must be revisited in terms of an adjustment to the lodestar figure and the multiplier.
We begin by noting that the trial court’s calculation of a reasonable fee award is committed to its discretion. Furthermore, in exercising its discretion, the trial court may determine the value of services “‘contrary to, or without the necessity for, expert testimony.’” (PCLM Group v. Drexler, supra, 22 Cal.4th at p. 1096; Melnyk v. Robledo, supra, 64 Cal.App.3d at pp. 623-624.) We find no basis for setting aside conclusions that Mr. Woosley’s litigation efforts were duplicative and inefficient to the degree found by the trial court. The record shows that Mr. Woosley has a predilection for over briefing an issue. The trial court cited as a specific example that the combined time spent litigating by other counsel was 12, 036.05 hours while Mr. Woosley claimed 13, 174.25 hours excluding requests for the fee award. The trial court further noted that Mr. Woosley had claimed to have spent 1, 489.65 hours on the pending fee applications as opposed to class counsel which claimed 442.3 hours. Thus, Mr. Woosley, who was not class counsel, claimed to have worked more hours than class counsel. In any event, contemporaneous records were not kept for the pertinent time periods. Thus, the trial court made its determinations based on reconstructed records from a 30-year time period. Under the circumstances, we cannot conclude that the trial court’s exercise of its discretion in this regard was abusive.
Furthermore, we have concluded that in setting the lodestar figure the trial court on remand must make a specific determination and make an appropriate reduction for duplicative and inefficient time. In addition, we do not address Mr. Woosley claims that the trial court abused its discretion by applying only a 1.5 multiplier to his fees while giving class counsel a 3.0 multiplier. This is because we have concluded that the multiplier or enhancement issue must be revisited due to the trial court’s failure to adequately assess the duplication issue.
Mr. Woosley also contends the trial court should have applied a test set forth in Woodland Hills Residents Assn., Inc. v. City Council [, supra, ] 23 Cal.3d [at p.] 941 to decide if the time spent litigating his $2000 refund was proper. The applicable rule in such a situation was set forth in Lyons v. Chinese Hosp. Assn. (2006) 136 Cal.App.4th 1331, 1348 as follows: “‘Under the private burden prong of section 1021.5, fees are recoverable ‘“when the cost of the claimant’s legal victory transcends his personal interest, that is, when the necessity for pursuing the lawsuit placed a burden on the plaintiff “‘out of proportion to his individual stake in the matter.”’” (Woodland Hills Residents Assn., Inc. v. City Council [, supra, ] 23 Cal.3d [at p.] 941.) “‘If the enforcement of the public interest is merely ‘coincidental to the attainment of... personal goals” [citation] or is ‘self serving, ” [citation], then this requirement is not met.’ (California Common Cause v. Duffy [, supra, ] 200 Cal.App.3d [at pp.] 750-751.)’ [Citation.] Stated otherwise, ‘The private attorney general doctrine... was not intended to reward litigants motivated by their own pecuniary interests who only coincidentally protect the public interest. [Citations.]’ [Citation.] [¶] According to a leading California treatise on the subject, ‘[t]his requirement really examines two issues: whether private enforcement was necessary and whether the financial burden of private enforcement warrants subsidizing the successful party’s attorneys.’ [Citation.]”
Mr. Woosley is correct that his pecuniary interest did not disqualify him from an award under section 1021.5. (See Baggett v. Gates (1982) 32 Cal.3d 128, 143; Lyons v. Chinese Hosp. Assn., supra, 136 Cal.App.4th at p. 1352; Otto v. Los Angeles Unified School Dist. (2003) 106 Cal.App.4th 328, 332-333.) Rather, the question was the whether the financial burden placed on Mr. Woosley was out of proportion to his personal stake in the lawsuit. (Lyons v. Chinese Hosp. Assn., supra, 136 Cal.App.4th at p. 1348; City of Santa Monica v. Stewart (2005) 126 Cal.App.4th 43, 85-88.) But, even if there was a benefit, an award of fees under section 1021.5 is not justified when the public interest advanced is secondary or incidental to a party’s own personal monetary gain. (DiPirro v. Bondo Corp. (2007) 153 Cal.App.4th 150, 199-200; Pacific Mutual Life Ins. Co. v. State Bd. of Equalization (1996) 41 Cal.App.4th 1153, 1165.) In this case, the record does not support the claim that the 2616.5 hours were excluded simply because Mr. Woosley obtained a personal benefit from the litigation. Indeed, the trial court implicitly determined that Mr. Woosley’s efforts as an individual in the class action did not automatically disqualify him from a private attorney general award. (See In re State Water Resources Control Bd. Cases (2008) 161 Cal.App.4th 304, 314-318; Bowman v. City of Berkeley (2005) 131 Cal.App.4th 173, 181; City of Santa Monica v. Stewart, supra, 126 Cal.App.4th at pp. 85-88.) Rather, the trial court concluded that Mr. Woosley “spent a considerable number of hours in this case representing himself, as pro se, as opposed to work in representation or on behalf of the classes.” The trial court also found that Mr. Woosley spent time unnecessarily duplicating class counsel’s work and “overdoing and overworking the case.” A trial court can consider the relative contributions of multiple private attorneys general in the exercise of discretion as to the proper amount of the fees. (City of Santa Monica v. Stewart, supra, 126 Cal.App.4th at p. 88; Thayer v. Wells Fargo Bank, N.A., supra, 92 Cal.App.4th at pp. 844-845.) Time spent on superfluous and duplicative efforts “may properly be used to reduce, or perhaps deny altogether, a particular fee request.” (City of Santa Monica v. Stewart, supra, 126 Cal.App.4th at p. 88; see also Committee to Defend Reproduction Rights v. A Free Pregnancy Center (1991) 229 Cal.App.3d 633, 643; Crawford v. Board of Education (1988) 200 Cal.App.3d 1397, 1407.) In this case, we are unable to conclude that the trial court improperly reduced the fee request simply because Mr. Woosley had a personal interest in the outcome of the case. Such a conclusion would be inconsistent with the trial court award to Mr. Woosley’s for his efforts in litigating claims on behalf of the class. Rather, the record shows that the trial court concluded that, for a substantial portion of the time, the public’s benefit was only secondary or incidental to Mr. Woosley’s own interests or was duplicative of class counsel’s efforts. In such a case, the fees were not warranted. (DiPirro v. Bondo Corp., supra, 153 Cal.App.4th 150, 199-200; Thayer v. Wells Fargo Bank, N.A., supra, 92 Cal.App.4th at pp. 844-845; Pacific Mutual Life Ins. Co. v. State Bd. of Equalization, supra, 41 Cal.App.4th at p. 1165.)
V. DISPOSITION
The order awarding attorney fees is reversed and the matter is remanded to the trial court to conduct a new hearing and determine the appropriate amount of fees to award under Code of Civil Procedure section 1021.5. In determining what is a reasonable fee award, the trial court is directed to: (1) consider and make any appropriate deductions from the lodestar figure of all counsel for the lack of success of the litigation for the period between 1978 and 1992 when the common fund was reduced from $800 million to $2 million, as well as any subsequent unsuccessful efforts by the class following and consistent with the Supreme Court’s decision and instructions on remand in Woosley v. State of California (1992) 3 Cal.4th 758; (2) calculate and reduce from the lodestar figure any hours attributed to Charles Patrick Woosley as inefficient, unnecessary, or duplicative of class counsel’s efforts; (3) reconsider whether Mr. Woosley is entitled to any multiplier or whether a negative multiplier is warranted due to his duplicative work; (4) reconsider the multiplier for class counsel and Mr. Woosley after due consideration is given to the lack of success of the litigation in light of the Supreme Court’s 1992 decision; (5) reconsider the amount of costs awarded in light of this opinion; (6) deny interest on the attorney fee award for the period of time prior to entry of the fee award; and (7) maintain the 2616.5 deduction of hours from Mr. Woosley’s fee application which were found by the trial court to be duplicative and for his own personal benefit. All parties shall bear their own costs on appeal.
We concur: ARMSTRONG, Acting P. J., KRIEGLER, J.