BILL PRESS еt al., Plaintiffs and Appellants, v. LUCKY STORES, INC., Defendant and Respondent.
L.A. No. 31718
Supreme Court of California
Aug. 18, 1983.
34 Cal.3d 311
COUNSEL
Lucas Guttentag, Fredric D. Woocher, Carlyle W. Hall, Jr., John R. Phillips and Bruce Williamson for Plaintiffs and Appellants.
Marjorie L. Fine, Andrew W. Lafrenz, Richard S. Reisman and Donahue, Gallagher, Thomas & Woods for Defendant and Respondent.
OPINION
BIRD, C. J.-The sole issue presented by this case is whether the trial court abused its discretion in awarding, and calculating the amount of, attorney fees under
I.
Plaintiffs, Bill Press and the California Oil Profits Coalition, sought to qualify an initiative measure for the June 1980 statewide election.2 The
Plaintiffs sought to circulate petitions on the premises of several privately owned shopping centers. Among the locations at which they attempted to gather signatures was the area directly in front of a Santa Monica supermarket owned by defendant Lucky Stores. The store was located in a shopping center which contained 16 other businesses.
After five days of uninterrupted solicitation, plaintiffs were ordered by store officials to stop gathering signatures in front of the store. The petition circulators were also threatened with arrest if they refused to comply immediately with the demand to leave. Plaintiffs thereupon filed an action for injunctive relief in the superior court. The court issued a temporary restraining order and a preliminary injunction restraining defendant from denying plaintiffs access to the premises.
Plaintiffs obtained approximately 3,000 signatures at defendant‘s store and 556,000 signatures statewide. Their initiative measure qualified аs Proposition 11 on the June 1980 ballot, but was defeated by the voters.
Plaintiffs were represented in the superior court by the Center for Law in the Public Interest (CLIPI), a nonprofit corporation which provides legal services without charge in cases which raise issues of broad public interest. After the election, plaintiffs sought an award of attorney fees pursuant to
Finding that plaintiffs had satisfied the statutory requisites for an award of fees, the superior court granted plaintiffs’ motion. However, the court concluded that the only benefit conferred by the litigation was its impact on the signature drive at the Santa Monica Lucky store. The court further reasoned that a reasonable fee could be computed by multiplying the requested amount by 3,000/556,000-a fraction representing the ratio of petition signatures obtained at the Santa Monica store to the numbеr of signatures obtained statewide. Accordingly, the court awarded plaintiffs $112.98 in attorney fees.
Plaintiffs appeal, contending that the trial court abused its discretion in calculating the amount of the fee award. They argue that the trial court failed to follow the “lodestar adjustment” method approved by this court in Serrano v. Priest (1977) 20 Cal.3d 25 [141 Cal.Rptr. 315, 569 P.2d 1303] (Serrano III). Instead, plaintiffs contend that the court used an arbitrary method of calculation which resulted in an award bearing no reasonable relationship to the lodestar figure.
Defendant responds that the litigation did not confer a “significant benеfit” on the public or a large class of people. Thus, it argues, the trial court should not have even granted the motion for attorney fees. Since plaintiffs were not entitled to fees in any amount, the argument continues, they were not prejudiced by any error the trial court may have made in calculating the award.
II.
The first issue this court must decide is whether the trial court abused its discretion in concluding that plaintiffs were entitled to attorney fees under
Defendant does not dispute that plaintiffs’ action “resulted in the enforcement of an important right.” Indeed, the litigation enforced the people‘s fundamental rights of free expression and petition guaranteed by
Rather, defendant contends that no “significant benefit” was conferred on the public by the litigation since the superior court simply applied principles already established in Pruneyard, supra, 23 Cal.3d 899, to plaintiffs’ activities. This argument suggests (1) that only those plaintiffs who prevail in “landmark” cases may be entitled to an award of fees, and (2) that the benefit conferred in this case was insubstantial because it extended only to those patrons of the Santa Monica store who signed the petitions. Both of these suggestions lack merit.
The fact that litigation enforces existing rights does not mean that a substantial benefit to the public cannot result. Attorney fees have consistently been awarded for the enforcement of well-defined, existing obligations. (See, e.g., Friends of “B” Street v. City of Hayward (1980) 106 Cal.App.3d 988 [165 Cal.Rptr. 514] [suit to compel the preparation of an environmental impact report as required by state and local environmental quality guidelines]; Rich v. City of Benicia (1979) 98 Cal.App.3d 428 [159 Cal.Rptr. 473] [same].)
Indeed, the declaration of rights in “landmark” cases would have little meaning if those rights could not be “enforced” in subsequent litigation. As this court noted in Woodland Hills, supra, 23 Cal.3d at page 933, “without some mechanism authorizing the award of attorneys fees, private actions
In addition, this court does not agree with defendant that the benefits resulting from this litigation were not conferred on “the general public or a large class of persons.” (See
In Serrano III, this court recognized that attorney fees were proper under the private attorney general doctrine “simply because of the magnitude and significance of the fundamental constitutional principles involved in that litigation and the benefit that flоwed to the general public in having such principles enforced.” (Woodland Hills, supra, 23 Cal.3d at p. 939.) The fundamental constitutional principles there involved were embodied in the equal protection clause of the state Constitution. (Serrano III, supra, 20 Cal.3d at p. 31.) Here, similarly, the general public benefitted from the enforcement of fundamental constitutional rights-those embodied in the free speech and petition provisions of the California Constitution.7
Defendant contends that since this same result could have been achieved by informing store officials of the Pruneyard decision (23 Cal.3d 899), the access to other shopping centers may not properly be considered a result of this litigation. That contention is, at best, disingenuous. Before filing this action, plaintiffs’ attorneys attempted to use that precise technique to gain access to the Santa Monica Lucky store. Plaintiffs’ еfforts were unavailing. Defendant persistently adhered to its established policy of prohibiting all nonbusiness-related speech-with the exception of noncontroversial charitable fund-raising events and nonpartisan voter registration drives-on its premises. Moreover, defendant‘s declarations later admitted it had not intended to abide by Pruneyard-even though it was clearly the law of this state8-unless that decision was affirmed by the United States Supreme Court.9
Only after plaintiffs obtained the injunction involving defendant‘s Santa Monica store was defendant‘s attorney willing to advise other Lucky
Moreover, even if the impact of plaintiffs’ lawsuit were limited to the access gained at the Santa Monica store, the litigation would still have benefitted a “large class of people.” In addition to the approximately 3,000 persons who signed plaintiffs’ petitions, countless others (i.e., nonsigning store patrons) were educated about a contemporary issue of public importance.10 In addition, while gathering signatures at the Santa Monica store plaintiffs were able to enlist additional volunteers and accept financial contributions. For these reasons, plaintiffs’ litigation satisfies the “substantial benefit” requirement of
Plaintiffs’ action also fulfills
Since plaintiffs’ litigation satisfied all the applicable requirements of
III.
Next, this court must consider whether the trial court erred in calculating the amount of the attorney fees awarded.
When a party is entitled to attorney fees under
The proper determination and use of the lodestar figure is extremely important. As this court noted in Serrano III, “The starting point of every fee award . . . must be a calculation of the attorney‘s services in terms of the time he has expended on the case. Anchoring the analysis to this concept is the only way of approaching the problem that can claim objectivity, a claim which is obviously vital to the prestige of the bar and the courts.‘” (20 Cal.3d at p. 48, fn. 23, quoting City of Detroit v. Grinnell Corp. (2d Cir. 1974) 495 F.2d 448, 470.)
Ultimately, the trial judge has discretion to determine “the value of professional services rendered in his [or her] court . . . .” (Serrano III, supra, 20 Cal.3d at p. 49.) However, since determination of the lodestar figures is so “[f]undamental” to calculating the amount of the award, the exercise of that discretion must be based on the lodestar adjustment method. (Id., at pp. 48-49; Mandel v. Lackner (1979) 92 Cal.App.3d 747, 758 [155 Cal.Rptr. 269] (Mandel II).)
In this case, plaintiffs submitted a lodestar figure of $13,960 and requested that it be multiplied by a factor of 1.5 (i.e., enhanced by 50 percent) “to reflect the broad public impact of the results obtained and to compensate for the high quality of work performed and the contingencies involved in undertaking this litigation.”
The trial court, however, did not use plaintiffs’ lodestar figure nor engage in a Serrano-type analysis of the various factors which might justify modifying that sum. Instead, the trial court devised its own arbitrary formula for
Defendant has wisely abandoned its contention that the trial court properly followed the lodestar adjustment method. Earlier, it had been argued that the trial court reached its $112.98 result by applying a “negative multiplier“-designed to reflect the narrow scope of the litigation-to plaintiffs’ lodestar figure.
However, defendant‘s contention failed for two reasons. First, the court‘s calculation never even referred to the lodestar figure. The fraction devised by the court was multiplied not by the lodestar figure, but by the enhanced amount requested by plaintiffs.
Second, the trial court‘s fraction was not a valid “negative multiplier” under Serrano III, supra. Under the trial court‘s analysis, the 3,000 figure represented the number of signatures attributable to plaintiffs’ action, and the 556,000 figure represented the number collected by unrelated means. The court thus improperly intertwined the determination of the litigation‘s importance with the question-which should arise only after it has been concluded that an award is proper-of the amount to be awarded. The latter inquiry requires the court to consider a wide range of factors including the skill of the attorneys, the difficulty of the case, and the contingencies involved in prosecuting the action. (See ante, fn. 12.) The fraction devised by the court was designed not to take into account these Serrano III factors, but to reflect only the trial judge‘s view of the results achieved by the litigation. As such, it was not a proper adjustment mеchanism or “multiplier.”
In any event, the court‘s 3,000/556,000 ratio was an illogical measure of the results obtained by the litigation. The fact that the total number of signatures gathered throughout the state greatly exceeded the number gathered at the Santa Monica store did not diminish the importance of the rights secured. The vindication of plaintiffs’ freedom of speech and petition rights would have been complete even if plaintiffs had obtained no signatures following the injunction.
Lawsuits enforcing the right to speak freely or to petition the government for redress оf grievances frequently arise when a single person or a small group is prohibited from speaking about a particular subject or at a partic-
The flaw in the trial court‘s approach is also evident from the fact that a positivе multiplier would be impossible. The number of signatures collected statewide would never be less than the number attributable to the specific litigation in which fees are sought. Thus, use of the trial court‘s multiplier would have the anamolous result of never augmenting, and always diminishing, the lodestar amount.
Finally, while a trial court has discretion to determine the proper amount of an award, the resulting fee must still bear some reasonable relationship to the lodestar figure and to the purpose of the private attorney general doctrine. If there is no reasonable connection between the lodestar figure and the fee ultimately awarded, the fee does not conform to the objectives established in Serrano III, and may not be upheld.
In Serrano III, the award approved by this court was 40 percent greater than the lodestar figure. The lodestar figure was multiplied by a factor of 1.4. In Coalition for L.A. County Planning etc. Interest v. Board of Supervisors (1977) 76 Cal.App.3d 241, 251 [142 Cal.Rptr. 766], the touchstone figure was multiplied by a factor of 2, resulting in an award which was a 100 percent increase over the lodestar amount.
In this case, by contrast, the trial court divided plaintiffs’ requested amount by 185! An adjustment of that magnitude so distorts the objective lodestar figure that it must be considered on its face a palpable abuse of discretion.
IV.
Since this litigation satisfies the requisites of
The judgment is affirmed insofar as it establishes that plaintiffs are entitled to an award of fees for the services rendered by their attorneys. As to the
Mosk, J., Kaus, J., Broussard, J., Reynoso, J., and Grodin, J., concurred.
RICHARDSON, J., Concurring and Dissenting.--I concur in the judgment. Petitioners have established that their prosecution of this action yielded a significant benefit to a large class of persons thereby qualifying them for an award of attorney fees under
However, I must dissent from the majority‘s apparent assumption that where litigation enforces “fundamental constitutional principles” such as the rights to free speech and to petition, the lawsuit must be found to have conferred a “significant benefit” on the general public because enforcement of those rights “benefits society as a whole.” (
Thus, Serrano III stands for the proposition that the dual requirements of (1) an important right affecting the public interest, and (2) a significant bеnefit to the general public or to a large class of persons, are separate and distinct prerequisites to an award of attorneys’ fees under the “private attorney general” doctrine codified by
The majority nonetheless appears to fuse these two prerequisites in the case of litigation enforcing fundamental constitutional principles. Granted that constitutional mandates are more important than other laws, an award of attorney fees still cannot be justified by the fact of enforcement alone. The majority asserts that such enforcement indirectly benefits society as a whole; however, it is by no means inevitable that vindication of an individual‘s constitutional rights will yield a significant benefit to the general public. Particularly in the area of free speech, a “realistic assessment, in light
What is required by
Notes
Unless otherwise noted, all statutory references are to the
Plaintiffs requested that this touchstone figure be multiplied by a factor of 1.5 “to reflect the broad public impact of the results obtained and to compensate for the high quality of work performed and the cоntingencies involved in undertaking this litigation.” Thus, the attorney fees sought by plaintiffs totaled $20,940.
In Pacific Legal Foundation, two considerations not present here combined to make an award unwarranted. First, the litigation enforced plaintiffs’ right to be free from an unconstitutional taking of their private property. While that right was certainly important, the economiс interests protected in that case can hardly be considered as fundamental as the equal protection rights vindicated in Serrano v. Priest (1976) 18 Cal.3d 728 [135 Cal.Rptr. 345, 557 P.2d 929], or the freedom of speech and petition rights enforced in the present case.
Second, the primary effect of the judgment in Pacific Legal Foundation was merely to invalidate a condition placed on a land use permit which encumbered the value of a single parcel of property. Only plaintiffs’ personal economic interests were advanced by their lawsuit. Under those factual circumstances, the litigation “did not result in conferring a ‘significant benefit’ on a ‘large сlass of persons.‘” (Pacific Legal Foundation, supra, 33 Cal.3d at p. 167.)
In this case, by contrast, plaintiffs had no personal pecuniary interest in the subject of the litigation. Instead, they sought to enforce their fundamental rights to speak freely and to petition the government. Litigation enforcing these rights necessarily confers a significant benefit on society as a whole.
