CROSKEY, J.
Mary Ann Smith and Michael Graham successfully pursued an anti-SLAPP (Code Civ. Proc., § 425.16) motion in this malicious prosecution action brought by John Fuchs. Smith and Graham then moved, as prevailing parties on the anti-SLAPP motion, for an award of attorney fees. The trial court made an award of fees intended to compensate Smith and Graham for all of their fees reasonably incurred in the action, not merely all of their fees reasonably incurred in connection with their successful anti-SLAPP motion. Both parties appeal. We conclude that the trial court erred in awarding fees in connection with the entire action rather than fees incurred in connection with the anti-SLAPP motion, and therefore reverse for a recalculation of an appropriate attorney fee award.
Smith and Graham invested in Titan Sparkplug Company, Inc., based on representations they had read in a private placement memorandum. When they learned that statements in that document were false, they brought a fraud action against Titan and its directors. After obtaining the defaults of Titan and two of its directors, and settling with a third, Smith and Graham dismissed their action on the eve of trial against the sole remaining defendant, Fuchs. Fuchs then brought the instant malicious prosecution action against Smith, Graham, and their counsel in the underlying fraud action, Attorney Mark Levine. Smith and Graham, who were now represented by different counsel, the law firm of Lurie, Zepeda, Schmalz & Hogan (LZSH), filed an anti-SLAPP motion, on the basis that Fuchs could not establish a prima facie case of malicious prosecution, specifically with respect to the element of lack of probable cause. In response to Smith and Graham's motion, Fuchs filed a motion to lift the automatic discovery stay which applies when an anti-SLAPP motion is filed (Code Civ. Proc., § 425.16, subd. (g)), in order to conduct limited discovery which he argued was necessary to properly oppose the anti-SLAPP motion. Attorney Levine joined in Smith and Graham's anti-SLAPP motion, and also filed a separate anti-SLAPP motion. The trial court granted both anti-SLAPP motions, denied Fuchs's motion for discovery, and dismissed Fuchs's malicious prosecution action. Fuchs appealed, and we ultimately affirmed the dismissal in favor of all defendants. (Fuchs v. Levine (Feb. 15, 2011, B220010 [nonpub. opn.].)
While the appeal was pending, Smith and Graham moved for their attorney fees and costs, as prevailing defendants on an anti-SLAPP motion.
Fuchs opposed the motion, arguing that Smith and Graham were entitled only to fees incurred in connection with the anti-SLAPP motion. Fuchs also challenged the total amount billed, arguing that there was "substantial evidence of duplication and excessive billing." Fuchs argued that, throughout the entire case, LZSH generated a relatively small amount of documents, which did not justify the 238 hours billed.
In reply, Smith and Graham argued that they were entitled to all attorney fees and costs incurred in the entire action, not simply in connection with the motion to strike. They relied on Metabolife International, Inc. v. Wornick (S.D. Cal. 2002) 213 F.Supp.2d 1220 (Metabolife), for the proposition that, when all causes of action in a suit are disposed of by means of an anti-SLAPP motion, all attorney fees incurred in the action are recoverable. Smith and Graham also sought an additional 13.3 hours in attorney fees for preparing the reply in support of the attorney fee motion, and 3 hours for preparation for, and attendance at, the hearing on the motion.
A hearing was held,
Fuchs filed a timely notice of appeal from the order awarding attorney fees and costs. Smith and Graham filed a timely notice of cross-appeal.
On appeal, Fuchs initially argued that the award of fees and costs must be reversed if the underlying anti-SLAPP dismissal was reversed on appeal. As we affirmed the dismissal, Fuchs no longer makes that argument. Instead, he pursues his secondary argument, that the attorney fee award was excessive. Fuchs contends that a prevailing defendant on an anti-SLAPP motion is entitled to an award of only those attorney fees and costs directly related to the anti-SLAPP motion itself. Additionally, Fuchs contends that, in many ways, the LZSH invoices show that their claimed fees were duplicative, unreasonable, and excessive.
In contrast, Smith and Graham argue that the trial court's award of attorney fees was too low. They argue that the trial court's reduction of their claimed fees was arbitrary, and that the court's award was improperly limited to only a part of the fees it incurred in preparation of the anti-SLAPP motion itself.
Code of Civil Procedure section 425.16, subdivision (c)(1) provides, in pertinent part, "a prevailing defendant on a[n anti-SLAPP motion] shall be entitled to recover his or her attorney's fees and costs." "`The language of the anti-SLAPP statute is mandatory; it requires a fee award to a defendant who brings a successful motion to strike. Accordingly, our Supreme Court has held that under this provision, "any SLAPP defendant who brings a successful motion to strike is entitled to mandatory attorney fees." [Citation.]' [Citation.] At the same time, `a defendant who brings a successful special motion to strike is entitled only to reasonable attorney fees, and not necessarily to the entire amount requested. [Citations.]' [Citation.] We review the trial court's ruling for abuse of discretion." (G.R. v. Intelligator (2010) 185 Cal.App.4th 606, 620.)
However, "[t]he abuse of discretion standard comes into play only where the trial court has discretion to act." (Wanland v. Law Offices of Mastagni, Holstedt & Chiurazzi (2006) 141 Cal.App.4th 15, 20 (Wanland).) Whether the trial court has discretion to award fees for time spent on a particular task is an issue law that we review de novo. (See ibid.)
The issue has arisen as to whether a prevailing defendant on an anti-SLAPP motion is entitled to an award of attorney fees and costs only for the anti-SLAPP motion itself or for the entire action. The court in Lafayette Morehouse, Inc. v. Chronicle Publishing Co. (1995) 39 Cal.App.4th 1379 considered the legislative history of the anti-SLAPP statute and concluded a fee award was meant to compensate only for the fees incurred for the anti-SLAPP motion itself. (Id. at pp. 1381, 1383.) This holding has been slightly expanded, to the extent that it has been interpreted to mean that a prevailing defendant is entitled to fees "incurred in connection with" the anti-SLAPP motion. (Wanland, supra, 141 Cal.App.4th at p. 21; Metabolife, supra, 213 F.Supp.2d at p. 1223.
Thus, an award of attorney fees to a prevailing defendant on an anti-SLAPP motion properly includes attorney fees incurred in litigating the fee award itself, and fees incurred defending on appeal the order granting the anti-SLAPP motion and the fee award. (Wanland, supra, 141 Cal.App.4th at p. 21.) "The fees awarded should include services for all proceedings, including discovery initiated by the opposing party pursuant to [Code of Civil Procedure] section 425.16, subdivision (g), directly related to the special motion to strike." (Jackson v. Yarbray (2009) 179 Cal.App.4th 75, 92.) A fee award under the anti-SLAPP statute may not include matters unrelated to the anti-SLAPP motion, such as "attacking service of process, preparing and revising an answer to the complaint, [or] summary judgment research." (Christian Research Institute v. Alnor (2008) 165 Cal.App.4th 1315, 1325.) Similarly, the fee award cannot include fees for "obtaining the docket at the inception of the case" or "attending the trial court's mandatory case management conference," as such fees "would have been incurred whether or not [the defendant] filed the motion to strike." (Ibid.) In short, the award of fees is designed to "`reimburs[e] the prevailing defendant for expenses incurred in extracting herself from a baseless lawsuit'" (Wanland, supra, 141 Cal.App.4th at p. 22, italics added), not to reimburse the defendant for all expenses incurred in the baseless lawsuit.
"The amount of an attorney fee award under the anti-SLAPP statute is computed by the trial court in accordance with the familiar `lodestar' method. [Citation.] Under that method, the court `tabulates the attorney fee touchstone, or lodestar, by multiplying the number of hours reasonably expended by the reasonable hourly rate prevailing in the community for similar work. [Citations.]' [Citation.]" (Cabral v. Martins (2009) 177 Cal.App.4th 471, 491.) "In awarding fees the trial court is not constrained by the amount sought by the successful moving parties [citation], but is obligated to award `reasonable attorney fees under section 425.16 [that] adequately compensate[] them for the expense of responding to a baseless lawsuit.' [Citations.]" (Jackson v. Yarbray, supra, 179 Cal.App.4th at p. 92.)
An unreasonably inflated fee request permits the trial court to reduce the fee award or deny it altogether. (Christian Research Institute v. Alnor, supra, 165 Cal.App.4th at p. 1322.) If the trial court were required to award a reasonable fee when counsel overreached, it would encourage overreaching, as the only penalty would be recovery of the reasonable fee for which counsel should have sought reimbursement from the start. (Ibid.) A trial court may conclude that a fee request is unreasonably padded, vague, and worthy of little credence based on the trial court's own observations of the proceedings and the billing records submitted. (Id. at p. 1326.)
Applying these principles to the instant case, we conclude that the trial court's order must be reversed. While the trial court correctly used the lodestar method to calculate an award of fees that it, within its discretion, believed to be reasonable, the trial court also expressed its opinion that, because the entire lawsuit was subject to the anti-SLAPP motion, all attorney fees incurred in the case were incurred in connection with the anti-SLAPP motion and were therefore recoverable (to the extent they were reasonable). Smith and Graham are entitled only to their fees reasonably incurred in connection with the anti-SLAPP motion; other fees are simply not recoverable.
To provide assistance to the trial court on remand, we specifically address three areas of dispute: (1) fees related to Fuchs's discovery motion; (2) fees related to an insurance dispute; and (3) fees related to Attorney Levine and his anti-SLAPP motion.
First, Smith and Graham incurred attorney fees in connection with opposing Fuchs's request to lift the discovery stay imposed by their filing of an anti-SLAPP motion. On appeal, Fuchs argues that such fees were not incurred in connection with the anti-SLAPP motion and are therefore not recoverable. This is incorrect. Fuchs had moved to lift the anti-SLAPP discovery stay in order to conduct discovery that he believed was necessary for his opposition to the anti-SLAPP motion. Fees incurred in successfully resisting that motion were incurred in connection with the anti-SLAPP motion.
Second, Smith and Graham sought reimbursement for fees incurred in connection with a dispute with their insurance carrier relating to this litigation.
Third, the billing records include time spent communicating with Attorney Levine and reviewing the anti-SLAPP documents he filed. As Attorney Levine had represented Smith and Graham in the underlying action, he was clearly someone with whom LZSH needed to confer in the course of preparing their anti-SLAPP motion. Fees incurred conferring with Attorney Levine in order to prepare Smith and Graham's anti-SLAPP motion were necessarily incurred in connection with the anti-SLAPP motion, and were recoverable. However, fees incurred in connection with Attorney Levine's anti-SLAPP motion were not. Smith and Graham's counsel would have been required to review Attorney Levine's anti-SLAPP motion regardless of whether Smith and Graham had filed their own anti-SLAPP motion. As such, those fees should not be included in any fee award.
Finally, we note that Smith and Graham do not oppose the trial court's express determination that LZSH's billings were excessive. Upon concluding that the fees claimed were excessive, the trial court simply determined a reasonable number of attorney hours, based on its experience with the case, for which Smith and Graham should receive a reasonable fee. There was no error in this;
The trial court awarded Smith and Graham statutory costs of $780. Fuchs does not dispute the propriety of this award. The court denied Smith and Graham an additional $1,999.55 in costs which Smith and Graham had sought in their motion for attorney fees. Smith and Graham challenge this denial. These additional costs were identified in LZSH's billings as "disbursements," and included, among other things, charges for postage and photocopying. Smith and Graham concede that these expenses are generally not recoverable under the costs statute, which is why Smith and Graham did not seek them in their memorandum of costs. (See, e.g., Code Civ. Proc., § 1033.5, subd. (b)(3) [excluding from allowable costs postage and photocopying charges, except for exhibits].) However, they argued that the costs were recoverable as costs under the anti-SLAPP statute.
The anti-SLAPP statute provides that a prevailing defendant is entitled "to recover his or her attorney's fees and costs." (Code Civ. Proc., § 425.16, subd. (c)(1).) Smith and Graham have provided no authority for the proposition that the term "costs" as used in the anti-SLAPP statute is any different from "costs" as defined in Code of Civil Procedure section 1033.5. Indeed, Code of Civil Procedure section 1033.5, subdivision (b) states, "The following items are not allowable as costs, except when expressly authorized by law:" and then sets forth several items not recoverable as costs, including, as noted above, postage and photocopying charges. Code of Civil Procedure section 425.16, subdivision (c)(1), which speaks only of "costs," clearly does not "expressly authorize[]" the award of costs excluded by Code of Civil Procedure section 1033.5. Thus, those costs are not recoverable, and the trial court did not err in refusing to award them.
The trial court's order awarding $41,250 in attorney fees to Smith and Graham, as prevailing parties on the anti-SLAPP motion, is reversed. The matter is remanded to the trial court to recalculate a reasonable fee award consistent with the views expressed in this opinion. The parties shall bear their own costs and attorney fees in connection with this appeal.
WE CONCUR:
KLEIN, P. J.
KITCHING, J.
