CJ Freshway America Corporation v. Lim CA2/8 ( 2024 )

Filed 10/14/24 CJ Freshway America Corporation v. Lim CA2/8
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION EIGHT
CJ FRESHWAY AMERICA B321415 & B322905
CORPORATION,
Plaintiff and Respondent, (Los Angeles County
Super. Ct. No. 19STCV01929)
v.
MINHO LIM et al.,
Defendants and Appellants.
APPEALS from judgment and order of the Superior Court
of Los Angeles County. Daniel S. Murphy, Judge. Affirmed.
Park, Daniel E. Park, Alisa M. Morgenthaler, Samuel F.
Izzo, Jason H. Woltman, Wil J. Rios, and Amirah Arif for
Defendants and Appellants.
DLA Piper, John S. Gibson, Justin Ilhwan Park, David B.
Farkas, Justin R. Sarno, and Stanley J. Panikowski, III, for
Plaintiff and Respondent.
_________________________________
INTRODUCTION
A jury found defendants Minho Lim, Ki Soon Seo, N9 Int’l
Trading, Inc. (N9), and Kaldea, Inc. (Kaldea) (collectively,
defendants) liable for, among other things, receiving stolen
property belonging to plaintiff CJ Freshway America Corporation
(Freshway). The jury found Lim, N9, and Kaldea jointly and
severally liable for over $1.5 million in damages and Seo liable for
over $900,000 in damages. After entering judgment in
Freshway’s favor, the court awarded the company over $1 million
in attorney fees.
Defendants appeal from the judgment and the
postjudgment attorney fee award. They raise several claims of
error arising out of the jury trial, and they argue the court
abused its discretion in calculating the amount of Freshway’s
attorney fee award. We have consolidated both appeals for
purposes of oral argument and decision. As we explain, all of
defendants’ arguments lack merit. Accordingly, we affirm the
judgment and the fee award.
FACTS AND PROCEDURAL BACKGROUND
1. The parties
Freshway is headquartered in Los Angeles. The company
imports food from overseas and sells it throughout the United
States.
Seo is Lim’s mother. Seo formed Kaldea in 2017. She was
Kaldea’s sole owner until she transferred ownership to Lim in
2019. Lim is the sole owner of N9.
2. Lim’s employment with Freshway
In July 2016, Freshway hired Lim as a sales associate.
Lim was responsible for negotiating Freshway’s agreements with
its suppliers and buyers. Lim introduced Freshway to Meshquat
2
International Trading Company, LLC (“Meshquat”) and MiCal
Seafood Inc. (MiCal), which would become Freshway’s biggest
supplier and customer, respectively. Freshway often purchased
seafood from Meshquat and sold it to MiCal and another buyer,
Mariscos Bahia, Inc. (Mariscos).
Between 2017 and 2018, Lim and Meshquat engaged in
a scheme to defraud Freshway. Lim convinced Freshway to
approve 12 purchase agreements that Meshquat never fulfilled.
When Freshway approved each agreement, it sent part of the
purchase price to Meshquat. For some of the orders, fake bills of
lading were generated, which purported to show that Meshquat
sent goods to Freshway’s buyers. After Lim presented a fake
bill of lading to Freshway’s management, the company paid
Meshquat the remainder of the purchase price for the
corresponding order. Freshway paid Meshquat about
$1.1 million for orders that were never fulfilled.
Meshquat sent Kaldea and N9 kickback payments for
the orders that Meshquat never fulfilled. On the same date
Freshway sent a payment to Meshquat, Meshquat would transfer
money to Kaldea or N9. In total, Meshquat sent Kaldea and N9
about $450,000 in kickback payments. Unbeknownst to
Freshway, Lim also provided discounted seafood to MiCal and
Mariscos in exchange for $50,000 in kickback payments sent to
Kaldea. Lim used the kickback payments to pay for personal
expenses, including entertainment, gambling, car payments,
rent, and travel.
In August 2018, Freshway conducted an audit of orders
that Lim negotiated. After Lim learned of the audit, he texted
an employee at MiCal, “I think they found out. O-F-U-K.”
Lim deleted from his work computer files related to Freshway’s
3
transactions with Meshquat, and he deleted from his phone text
messages with employees at Meshquat. Kaldea also transferred
$310,000 to Seo’s bank account around the time of Freshway’s
audit.
Freshway’s management interviewed Lim as part of the
audit. Lim exchanged over 200 text messages with Seo, in which
she coached him on how to behave during the interview. Among
other things, Seo told Lim to deny ownership of Kaldea and “act
like you know nothing.”
Lim did not return to work at Freshway after his interview.
3. Freshway’s lawsuit
Freshway sued Lim, Seo, N9, and Kaldea. Freshway’s
operative second amended complaint asserted the following
causes of action: (1) breach of duty of loyalty against all
defendants; (2) breach of written contract against Lim; (3) fraud
against Lim, Kaldea, and N9; (4) aiding and abetting fraud
against Seo, N9, and Kaldea; (5) fraudulent concealment against
Lim; (6) aiding and abetting breach of duty of loyalty against Seo,
N9, and Kaldea; (7) conversion against all defendants; (8) unjust
enrichment against all defendants; (9) violation of Business and
Professions Code section 17200 against all defendants;
(10) interference with prospective economic relations against all
defendants; (11) receiving stolen property in violation of Penal
Code section 496 against all defendants; (12) declaratory relief
against all defendants; and (13) negligent interference with
prospective economic relations against all defendants.
In March 2021, Freshway moved for summary adjudication
of its first, second, sixth, and eighth causes of action. The court
granted summary adjudication in Freshway’s favor on its first
cause of action for breach of duty of loyalty as to Lim and its sixth
4
cause of action for aiding and abetting breach of duty of loyalty
as to Seo, Kaldea, and N9. The court found Lim, Seo, Kaldea,
and N9 were liable for $503,792 in damages against Freshway.
The court denied Freshway’s motion on the company’s second
cause of action for breach of written contract and eighth cause of
action for unjust enrichment.
In February 2022, the court held a jury trial on Freshway’s
remaining causes of action. The jury made the following findings:
(1) Lim was liable for breach of contract; (2) Lim, N9, and Kaldea
were liable for making fraudulent misrepresentations; (3) Seo,
N9, and Kaldea were liable for aiding and abetting fraud; (4) Lim
was liable for fraudulent concealment; (5) Lim, N9, and Kaldea,
but not Seo, were liable for conversion; (6) Lim, N9, and Kaldea,
but not Seo, were liable for intentional interference with
prospective economic relations; (7) all defendants were liable for
receiving stolen property in violation of Penal Code section 496;
and (8) only Lim was liable for negligent interference with
prospective economic relations. As for the 11th cause of action for
receiving stolen property, the jury found Lim, N9, and Kaldea
were liable for $503,792 and Seo was liable for $310,000.
The jury also awarded Freshway $50,000 in punitive damages
against Lim, N9, and Kaldea. The jury found Freshway was not
entitled to any compensatory damages.
In March 2022, the court entered judgment in Freshway’s
favor and against Lim, Seo, N9, and Kaldea. As to Lim, N9, and
Kaldea, the court entered judgment against them, jointly and
severally, for $1,561,376, consisting of $503,792, tripled under
Penal Code section 496, subdivision (c), plus $50,000, with
interest under Civil Code section 3287 and Code of Civil
Procedure section 685.010. As to Seo, the court entered judgment
5
against her, jointly and severally with the other defendants,
for $930,000, consisting of $310,000, tripled under Penal Code
section 496, subdivision (c), with interest under Civil Code
section 3287 and Code of Civil Procedure section 685.010.
Defendants appealed from the judgment.
4. Attorney Fees
In May 2022, Freshway moved for $1,566,185.02 in
attorney fees under Penal Code section 496, subdivision (c),
and Code of Civil Procedure sections 1032 and 1033.5.1
In support of its attorney fees motion, Freshway submitted
a declaration from one of its attorneys, Justin Ilhwan Park. Park
was the lead attorney and billing partner representing Freshway.
When Park began representing Freshway in January 2019, he
worked at Mayer Brown LLP (Mayer Brown). Park continued to
represent Freshway after he moved to DLA Piper, LLP (DLA
Piper) in 2020.
Park has practiced for over 15 years, and he has extensive
experience in complex commercial litigation. He billed Freshway
between $705.37 and $755 per hour for work related to its
lawsuit against defendants. Several other attorneys billed
Freshway for work related to its lawsuit against defendants.
Park described the qualifications and hourly billing rates of two
of those attorneys: David B. Farkas and John Gibson. Farkas
has nearly 15 years of experience in business and commercial
litigation, and Gibson has more than thirty years of experience in
antitrust, commercial, healthcare, and technology litigation.
1 Freshway initially requested $1,750,683.29 in attorney
fees, but the company reduced its request after defendants
identified a tabulation error in the company’s fees calculation.
6
Farkas billed Freshway at $685 per hour, and Gibson billed
Freshway at $882.75 per hour.
Park testified that the rates charged by DLA Piper’s and
Mayer Brown’s attorneys for work related to this lawsuit were
“in line with or significantly lower than the rates charged by law
firms of similar caliber and reputation.” Park also submitted two
articles—one published by the National Law Journal in 2014
and the other published by the Wall Street Journal in 2016—
discussing the general increase in rates charged by large law
firms across the country. The National Law Review article also
noted that, according to an annual national survey of large law
firms, the average rate charged by partners in Los Angeles was
$665, while the average rate charged by associates in Los Angeles
was $401.
Freshway submitted billing invoices from Mayer Brown
and DLA Piper, covering work related to Freshway’s lawsuit that
the two firms performed between January 2019 and April 2022.
According to Park, the invoices showed how much time each
timekeeper spent working on this lawsuit, in one-tenth-of-an-
hour increments, and they included only work necessary to the
lawsuit, while any time reflecting unnecessary or duplicative
work was “written off.” The invoices were reviewed and approved
by the responsible partner before they were sent to Freshway.
Park redacted from the invoices text that would reveal attorney
work product or attorney-client communications.
Park explained that Mayer Brown incurred $23,262.53 in
fees preparing Freshway’s attorney fees motion and opposing a
motion to tax costs filed by defendants that had yet been billed to
Freshway. Park also noted that DLA Piper and Mayer Brown
wrote off some of the work that they performed for Freshway
7
throughout this lawsuit, and that Mayer Brown provided
Freshway a “17.5% discount on each invoice.”
Defendants opposed Freshway’s attorney fees request.
Defendants argued the court should deny Freshway’s request in
its entirety, or significantly reduce any award of fees, because the
requested amount of fees was unreasonable.
The court granted Freshway’s attorney fees motion, finding
that Freshway was entitled to recover its fees under Penal Code
section 496, subdivision (c), because the jury found each
defendant liable for receiving stolen property. The court awarded
Freshway a total of $1,050,000 in attorney fees.
The court explained that it reduced the billing rate for
Freshway’s attorneys to $600 per hour, finding that such a rate
was reasonable based on “ ‘the “prevailing market rates in the
relevant community” ’ ” and the court’s “ ‘own knowledge and
familiarity with the legal market.’ ” Although the court noted
that Freshway’s redacted billing invoices did not itemize the
hours worked by each timekeeper, it concluded that company’s
counsel billed more than 2,300 hours for work related to this
lawsuit. The court found that 1,750 of those hours were
reasonably billed to Freshway because some of the work
performed by Freshway’s counsel was excessive and duplicative.
The court also did not award fees for work performed by
Freshway’s counsel on the company’s motion for summary
adjudication, finding that motion did not relate to Freshway’s
claim for receiving stolen property under Penal Code section 496.
Nevertheless, the court found that Freshway’s claim for receiving
stolen property was intertwined and shared common issues with
the company’s other claims.
8
Defendants appealed from the order awarding Freshway
attorney fees.
DISCUSSION
In their first appeal (B321415), defendants challenge the
judgment entered after the jury trial. Defendants contend:
(1) the court erred when it instructed the jury on the elements of
receiving stolen property under Penal Code section 496;
(2) insufficient evidence supports the jury’s finding that Seo
knowingly received stolen property; (3) kickback payments
cannot constitute stolen property under Penal Code section 496;
and (4) the court erred when it awarded Freshway treble and
punitive damages under Penal Code section 496.
In their second appeal (B322905), defendants challenge the
court’s postjudgment order awarding Freshway $1,050,000 in
attorney fees. Defendants do not contend the court erred in
awarding Freshway attorney fees. Instead, they argue the
amount of fees that the court awarded was unreasonable.
As we explain, all of defendants’ arguments lack merit.
1. Defendants have not shown the court erred when it
instructed the jury on the elements of receiving
stolen property
The court used a modified version of CALCRIM No. 1750 to
instruct the jury on the elements of receiving stolen property.
Relevant here, the court instructed the jury that “[p]roperty is
stolen if it was obtained by any type of theft, including theft by
‘any false or fraudulent representation or pretense.’ ” The court
did not define the elements of theft by false or fraudulent
representation or pretense. Defendants argue the court erred by
failing to do so. We disagree.
9
As a threshold matter, we reject Freshway’s contention
that defendants forfeited this issue by not objecting to the
modified version of CALCRIM No. 1750 used by the court.
A party is deemed to have objected to an instruction requested by
the other party unless the complaining party agreed to or
requested the challenged instruction. (Martinez v. Rite Aid Corp.
(2021) 63 Cal.App.5th 958, 970, fn. 3; see also Code Civ. Proc.,
§ 647.) Here, Freshway proposed the modified version of
CALCRIM No. 1750 that defendants contend did not fully define
the elements of theft by false or fraudulent representation or
pretense. Although defendants did not object to the instruction
on the grounds that it was incomplete, the record does not
establish that they requested or agreed to the form of the
instruction that the court used. Nevertheless, as we explain
below, defendants have not shown the court erred when it did not
instruct the jury on the elements of theft by false or fraudulent
representation or pretense.
A court has a sua sponte duty to instruct on general
principles of law that are closely and openly connected with the
facts presented at trial. (People v. Brown (2003) 31 Cal.4th 518,
559.) Where there is a factual dispute about whether the
property received was in fact stolen, the court must instruct the
jury on the complete definitions of theft. (People v. MacArthur
(2006) 142 Cal.App.4th 275, 280 (MacArthur).)
Defendants rely on MacArthur to contend the court had a
sua sponte duty to instruct the jury on the elements of theft by
false or fraudulent representation or pretense. Defendants’
reliance on MacArthur is misplaced.
In MacArthur, the defendant’s girlfriend frequently took
her mother’s jewelry, pawned it, and later retrieved it from the
10
pawn shop. (MacArthur, supra, 142 Cal.App.4th at p. 278.)
The girlfriend sometimes did so with her mother’s knowledge,
and she and her mother occasionally retrieved the jewelry
together. (Id. at p. 280.) The defendant was convicted of
receiving stolen property after his girlfriend gave him some of her
mother’s jewelry to pawn. (Id. at pp. 278–279.)
On appeal, the reviewing court reversed the defendant’s
conviction, concluding the trial court prejudicially erred because
it did not instruct the jury on the elements of theft. (MacArthur,
supra, 142 Cal.App.4th at p. 280.) The court reasoned that the
girlfriend’s testimony about her pattern of pawning and
retrieving her mother’s jewelry “called into question whether any
relevant participant had the requisite intent” to permanently
deprive the mother of her jewelry. (Id. at pp. 280–281.) Without
instructing on the definition of “ ‘stolen’ ” and “ ‘theft,’ ” the trial
court “failed to provide any guidance to the jury for determining
whether property had, in fact, been stolen.” (Id. at pp. 279–280.)
Unlike the defendant in MacArthur, defendants have not
shown there was any factual dispute at trial about whether the
property at issue in this case was stolen. In their opening brief,
defendants argue in a conclusory manner that it was disputed at
trial whether the kickback payments received by Kaldea and N9
consisted of money that was “stolen” from Freshway. Defendants
do not, however, point to any evidence, including any witness
testimony at trial, that would support a finding that the money
was not stolen. As appellants, it is defendants’ burden to point to
evidence in the record that supports their claims of error on
appeal. (Keyes v. Bowen (2010) 189 Cal.App.4th 647, 655–656
(Keyes).) By failing to do so, defendants have not shown the court
11
erred when it did not instruct the jury on the elements of theft by
false or fraudulent representation or pretense. (Ibid.)
2. Substantial evidence supports the jury’s finding that
Seo received stolen property
Defendants next contend insufficient evidence supports the
jury’s finding that Seo violated Penal Code section 496.
Specifically, defendants argue that Freshway failed to prove that
Seo knew she received stolen property when Kaldea transferred
$310,000 to her personal bank account. We disagree.
To establish a violation of Penal Code section 496, the
plaintiff must prove: (1) the property was stolen; (2) the
defendant knew the property was stolen; and (3) the defendant
had possession of the stolen property. (Lacagnina v. Comprehend
Systems, Inc. (2018) 25 Cal.App.5th 955, 970.) A defendant’s
knowledge that property was stolen may be proved by
circumstantial evidence. (People v. Alvarado (1982) 133
Cal.App.3d 1003, 1019 (Alvarado).) An inference that the
defendant knowingly received stolen property may be supported
by the defendant’s possession of the property accompanied by
suspicious circumstances. (Id. at pp. 1019–1020.)
Whether a defendant knowingly received stolen property is
a question of fact that we review for substantial evidence.
(Alvarado, supra, 133 Cal.App.3d at pp. 1019–1020.) We “ ‘ “view
the evidence in the light most favorable to the prevailing party,
giving it the benefit of every reasonable inference and resolving
all conflicts in its favor.” ’ ” (Moran v. Foster Wheeler Energy
Corp. (2016) 246 Cal.App.4th 500, 517.) “We do not reweigh
evidence or reassess the credibility of witnesses . . . [because] [w]e
are ‘not a second trier of fact.’ ” (Pope v. Babick (2014) 229
Cal.App.4th 1238, 1246.)
12
Freshway presented the following evidence at trial.
Meshquat engaged in a pattern of sending Kaldea and N9
kickback payments on the same dates that Freshway paid
Meshquat for the orders that Lim negotiated and Meshquat
never fulfilled. At the time Kaldea received the kickback
payments, Seo was Kaldea’s sole owner. Around the time of
Freshway’s audit of the orders that Meshquat never fulfilled,
Kaldea transferred $310,000 to Seo’s personal bank account.
In addition, Seo exchanged hundreds of text messages with Lim
during Freshway’s audit—around the time that Kaldea
transferred money into her bank account—in which she
encouraged Lim to lie about Kaldea’s ownership and his
involvement in Meshquat’s scheme to defraud Freshway. Seo’s
receipt of money from Kaldea after the company received
kickback payments from Meshquat, the timing of Kaldea’s
transfer of that money to Seo, and Seo’s suspicious behavior
during Freshway’s audit of the orders that Meshquat never
fulfilled support an inference that Seo knew she received stolen
property. (See Alvarado, supra, 133 Cal.App.3d at pp. 1019–
1020.)
3. Defendants have failed to show kickback payments
cannot constitute stolen property under Penal Code
section 496
Defendants next contend that the court erred in allowing
the jury to find they violated Penal Code section 496 because
kickback payments can never constitute stolen property. As we
explain, defendants have failed to show any error.
The trial court’s judgment is presumed correct. (Keyes,
supra, 189 Cal.App.4th at pp. 655–656.) The appellant carries
the burden to prove otherwise by providing reasoned argument
13
with citations to relevant legal authority on each point made.
(Ibid.) The reviewing court is not obligated to develop issues
raised by the appellant. (Bains v. Moores (2009) 172 Cal.App.4th
445, 455.) Instead, our review is limited to the issues that the
appellant adequately raises and briefs. (Ibid.) The appellant
forfeits any points that are not supported by reasoned legal
argument and factual analysis. (Keyes, at pp. 655–656.)
In their opening brief, defendants rely solely on McNally v.
United States (1987) 483 U.S. 350 (McNally) and United States v.
Holzer (7th Cir. 1988) 840 F.2d 1343 (Holzer) to contend that
kickback payments can never constitute stolen property for
purposes of Penal Code section 496. Defendants’ reliance on
these opinions is misplaced.
McNally and Holzer addressed what type of conduct could
support convictions under a former version of 18 United States
Code section 1341, the federal mail fraud statute. In both cases,
government officials were convicted of defrauding the public of its
intangible right to the fair and honest administration of
government. (McNally, supra, 483 U.S. at p. 352; Holzer, supra,
840 F.2d at p. 1345.) Although the officials in both cases received
kickback payments—commissions and bribes—in exchange for
their fraudulent conduct, neither opinion turned on whether such
payments could constitute stolen property. (McNally, at pp. 356–
361; Holzer, at pp. 1346–1350.) Rather, both opinions turned on
the nature of the victims’ rights that were implicated by the
defendants’ fraudulent conduct. (McNally, at pp. 356–361;
Holzer, at pp. 1346–1350.) McNally held, and Holzer followed,
that the version of the federal mail fraud statute in effect at the
time the cases were decided required a defendant to deprive his
or her victim of a tangible property interest, such as an interest
14
in money. (McNally, at pp. 356–361; Holzer, at pp. 1346–1350.)
Because the government in both cases proved only that the
officials deprived the public of its intangible right to the fair and
honest administration of government, the courts reversed the
defendants’ convictions. (McNally, at pp. 356–361; Holzer, at
pp. 1346–1350.)
Neither McNally nor Holzer held that kickback payments
can never constitute stolen property, let alone that such
payments cannot support a claim for receiving stolen property
under Penal Code section 496. McNally and Holzer therefore do
not support defendants’ contention that kickback payments
cannot constitute stolen property under Penal Code section 496.
(Santa Clara County Local Transportation Authority v. Guardino
(1995) 11 Cal.4th 220, 243 (Santa Clara County) [opinions are not
authority for issues they do not consider].) In fact, dicta from
Holzer undermines defendants’ position. As defendants
acknowledge, the court in Holzer discussed a hypothetical in
which kickback payments could constitute stolen property, where
the defendant received kickback payments consisting of money
that was intended for his employer. (Holzer, supra, 840 F.2d at
p. 1348.) Freshway relied on a similar theory in this case—i.e.,
that N9 and Kaldea received kickback payments consisting of
money that was obtained from Freshway through fraudulent
means.
Defendants do not otherwise develop any argument in their
opening brief addressing this issue. Indeed, defendants’ opening
brief cites no authority discussing what constitutes stolen
property, or how courts go about determining what constitutes
stolen property, for purposes of Penal Code section 496. In their
reply brief, defendants raise several new arguments for the first
15
time on appeal. Defendants have forfeited these arguments by
failing to raise them in their opening brief. (City of Palo Alto v.
Public Employment Relations Bd. (2016) 5 Cal.App.5th 1271,
1318.)
In sum, defendants have failed to show the court erred by
allowing the jury to find defendants liable for receiving stolen
property based on their receipt of the kickback payments at issue
in this case. (Keyes, supra, 189 Cal.App.4th at pp. 655–656.)
4. Defendants have failed to show the court erred by
awarding Freshway punitive and treble damages
Finally, defendants argue the court erred because it
awarded Freshway both treble and punitive damages for Lim’s,
N9’s, and Kaldea’s violations of Penal Code section 496. This
argument lacks merit.
Under Penal Code section 496, subdivision (c), any person
who has been injured by a violation of the statute “may bring an
action for three times the amount of actual damages, if any,
sustained by the plaintiff, costs of suit, and reasonable attorney’s
fees.” Generally, a plaintiff is not prohibited from recovering
punitive damages simply because a statute authorizes a plaintiff
to recover treble damages for the same wrongful act. (Marshall v.
Brown (1983) 141 Cal.App.3d 408, 418–419.) If the purpose of
the statutory damages is the same as that of the punitive
damages, however, a plaintiff cannot recover both the statutory
and punitive damages. (Id. at p. 419.)
The only authority defendants cite in their opening brief
to support their contention that Freshway was precluded from
recovering both punitive damages and treble damages for Lim’s,
N9’s, and Kaldea’s violations of Penal Code section 496 is Siry
Investment, L.P. v. Farkhondehpour (2022) 13 Cal.5th 333 (Siry).
16
Specifically, defendants cite to the procedural background from
Siry, which notes that the trial court granted the defendants’
motion for a new trial in part and directed the plaintiff to “choose
to collect either treble damages or punitive damages” under
Penal Code section 496, subdivision (c). (Siry, at p. 342.)
But Siry did not address whether the trial court was correct
in requiring the plaintiff to elect between an award of punitive
damages and an award of treble damages under Penal Code
section 496, subdivision (c). (Siry, supra, 13 Cal.5th at pp. 343–
367; see also id., at p. 346, fn. 6 [declining to address issue of
whether trial court correctly required the plaintiff to elect
between punitive and treble damages].) Nor did Siry otherwise
discuss whether a plaintiff may recover both punitive damages
and treble damages for a defendant’s violation of Penal Code
section 496. (Ibid.) Instead, Siry addressed a different issue—
whether a plaintiff may recover both treble damages and
attorney fees under Penal Code section 496, subdivision (c).
(Ibid.) Thus, Siry does not support defendants’ contention that
the court erred by allowing Freshway to recover punitive
damages and treble damages under Penal Code section 496. (See
Santa Clara County, supra, 11 Cal.4th at p. 243 [“an opinion is
not authority for an issue not considered therein”].)
Defendants do not otherwise develop any legal analysis
addressing this issue. Because we must presume the court’s
judgment is correct, defendants have not shown the court erred
by permitting Freshway to recover punitive and treble damages.
(Keyes, supra, 189 Cal.App.4th at pp. 655–656.)
17
5. The court did not abuse its discretion in awarding
Freshway attorney fees
5.1. Applicable law and standard of review
A plaintiff who prevails on a claim for receiving stolen
property under Penal Code section 496 is entitled to an award of
attorney fees. (Pen. Code, § 496, subd. (c).) In calculating the fee
award, the court should first settle on a lodestar figure.
(Ketchum v. Moses (2001) 24 Cal.4th 1122, 1133 (Ketchum).)
To do so, the court must determine the reasonable hours spent on
the case by plaintiff’s attorneys and multiply that number by the
prevailing hourly rate for private attorneys in the community
engaged in similar litigation. (Ibid.)
The court has discretion to adjust the lodestar figure up or
down based on a series of factors. (Nichols v. City of Taft (2007)
155 Cal.App.4th 1233, 1240 (Nichols).) Those factors include:
“(1) the novelty and difficulty of the questions involved, (2) the
skill displayed in presenting them, (3) the extent to which the
nature of the litigation precluded other employment by the
attorneys, (4) the contingent nature of the fee award. [Citation.]
The purpose of such adjustment is to fix a fee at the fair market
value for the particular action. In effect, the court determines,
retrospectively, whether the litigation involved a contingent risk
or required extraordinary legal skill justifying augmentation of
the unadorned lodestar in order to approximate the fair market
rate for such services.” (Ketchum, supra, 24 Cal.4th at p. 1132.)
We review a trial court’s determination of reasonable
attorney fees for abuse of discretion. (Los Angeles Unified School
District v. Torres Construction Corp. (2020) 57 Cal.App.5th 480,
516.) “The ‘ “experienced trial judge is the best judge of the value
of professional services rendered in his court, and while his
18
judgment is of course subject to review, it will not be disturbed
unless the appellate court is convinced that it is clearly wrong.” ’ ”
(Ketchum, supra, 24 Cal.4th at p. 1132.) Accordingly, our review
of a court’s award of attorney fees is highly deferential. (Nichols,
supra, 155 Cal.App.4th at p. 1239.)
5.2. Reasonable hourly rate
Defendants contend the $600 hourly rate used by the court
to calculate Freshway’s lodestar figure was unreasonable.
We disagree.
To determine an hourly rate for a lodestar figure, the court
should look to “the ‘prevailing market rates in the relevant
community.’ ” (Heritage Pacific Financial, LLC v. Monroy (2013)
215 Cal.App.4th 972, 1009.) The court should consider the
experience, skill, and reputation of the attorneys requesting fees,
and it may rely on its own knowledge and familiarity with the
legal market in setting a reasonable hourly rate. (Ibid.)
The court may also rely on affidavits of the prevailing party’s
attorneys and other attorneys concerning “ ‘prevailing fees in the
community,’ ” as well as rate determinations in other cases.
(Ibid.)
The court did not abuse its discretion in selecting $600 per
hour as the prevailing hourly rate for Freshway’s lodestar figure.
Freshway submitted evidence of the prevailing hourly rates for
partners and associates at large firms in Los Angeles, as well as
the background, experience, and billed hourly rates for three
partners who worked on Freshway’s lawsuit. The rate selected
by the court is almost $100 per hour lower than the lowest billing
rate, and almost $300 per hour lower than the highest billing
rate claimed by those partners. In addition, according to the
National Law Review article that Freshway submitted in support
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of its fees motion, the rate selected by the court was lower than
the average rate charged by partners at large firms in Los
Angeles as of 2014, several years before Freshway’s attorneys
began working on this case and about eight years before the court
calculated the challenged fee award. (See PLCM Group, Inc. v.
Drexler (2000) 22 Cal.4th 1084, 1095 [the “reasonable hourly rate
is that prevailing in the community for similar work”].)
Defendants rely on Vasquez v. Packaging Corporation of
America (C.D.Cal., Aug. 17, 2020, No. CV19-1935 PSG (PLAx)
2020 WL 6785650) (Vazquez), a federal district court decision, to
argue the court erred because it did not consult the 2018 Real
Rate Report (Real Report) for fees in the Central District of
Los Angeles when it calculated the prevailing hourly rate for
Freshway’s lodestar figure. Decisions of federal district courts
are not binding on California state courts. (Futrell v. Payday
California, Inc. (2010) 190 Cal.App.4th 1419, 1432, fn. 6.)
Regardless, the court in Vazquez noted only that the Real Report
is a useful tool for calculating reasonable hourly rates. (Vasquez,
at pp. 26–27.) It did not hold that courts are required to refer to
the Real Report when calculating a lodestar figure. (Ibid.) In
any event, the Real Report supports a finding that $600 per hour
was a reasonable hourly rate for Freshway’s lodestar figure.
According to Vazquez, the Real Report shows that as of 2018,
partners in Los Angeles charged hourly rates between $450 to
$955, while associates in Los Angeles charged hourly rates
between $382 and $721. (Id. at p. 27.) The hourly rate that
the court selected in this case falls well within those ranges.
Defendants argue the court erred in calculating the hourly
rate in this case because the actual averages of rates billed by
Park and Farkas were lower than the rates outlined in Park’s
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declaration. According to defendants, Park’s average billing rate
throughout this lawsuit was $687.69 per hour, and Farkas’s
average billing rate throughout this lawsuit was $669.67 per
hour. To support this argument, defendants include in their
opening brief two tables that they created purporting to calculate
the average billed rates for Park and Farkas. But defendants do
not cite to, or otherwise explain, where in the record the figures
used in their calculations were derived. Nor do they otherwise
cite any evidence in the record showing Freshway supplied the
court with inaccurate billing rates for some of its attorneys.
Defendants have, therefore, forfeited this argument. (Keyes,
supra, 189 Cal.App.4th at pp. 655–656 [the appellant forfeits any
argument not supported by “appropriate citations to the material
facts in the record”].)
In sum, we conclude the court did not abuse its discretion
when it selected $600 per hour as the reasonable hourly rate for
Freshway’s lodestar figure.
5.3. Reasonable hours spent on the litigation
A trial court has discretion to decide which of the hours
expended by the plaintiff’s attorneys were reasonably spent on
the litigation. (Meister v. Regents of University of California
(1998) 67 Cal.App.4th 437, 449.) We may only reverse a fee
award if it shocks the conscience and suggests that passion and
prejudice influenced the determination or if it is not supported by
the evidence. (Korchemny v. Piterman (2021) 68 Cal.App.5th
1032, 1051; Jones v. Union Bank of California (2005) 127
Cal.App.4th 542, 549–550.)
Defendants contend the court erred when it found
Freshway’s attorneys billed the company for more than
2,300 hours spent working on matters related to this lawsuit.
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According to defendants, Freshway substantiated about only
1,400 of those hours, because that is how many hours Park,
Farkas, and Gibson, the attorneys identified in Park’s
declaration, billed Freshway for work related to this lawsuit.
This argument lacks merit.
In its attorney fees order, the court explained that it
reviewed the billing invoices that Freshway submitted in support
of its attorney fees motion. Based on its review of those
documents, the court found that Freshway’s attorneys billed the
company for more than 2,300 hours of work related to this
lawsuit. In addition to the hours billed by Park, Farkas, and
Gibson, Freshway’s billing invoices also reflect work performed
by other attorneys and timekeepers, a fact that the court
acknowledged in calculating Freshway’s lodestar figure.
Defendants point to nothing in Freshway’s billing invoices that
undermines the court’s finding that the hours billed by the
company’s attorneys exceeded 2,300 hours.
Defendants next argue the court miscalculated how many
“timekeepers” billed Freshway for work spent on matters related
to this lawsuit. Defendants have forfeited this argument by
failing to cite anything in the record to support it. (Keyes, supra,
189 Cal.App.4th at pp. 655–656.)
Defendants also argue the court erred in finding
Freshway’s attorneys reasonably billed the company for
1,750 hours of work because (1) the size of Freshway’s legal team
“deviate[d] significantly from standard legal practice,” and (2) the
court failed to explain how many hours it attributed to work
related to Freshway’s summary adjudication motion. Defendants
do not, however, cite any authority addressing what the
“standard legal practice” is for the types of claims raised in this
22
lawsuit. Nor do defendants cite any authority requiring the court
to explain, item by item, how it calculated the number of hours a
plaintiff’s attorneys reasonably spent working on a lawsuit.
In any event, it is well-settled that a trial court is not required
to issue any, let alone a detailed, explanation of its fee award
calculation. (Rancho Mirage Country Club Homeowners Assn. v.
Hazelbaker (2016) 2 Cal.App.5th 252, 264 (Rancho Mirage).)
Here, Freshway submitted approximately 200 pages of
billing invoices and a declaration from its billing partner
assigned to this lawsuit describing the nature of the work
performed by Freshway’s attorneys. After reviewing that
evidence, the court found that many of the hours billed by
Freshway’s attorneys covered duplicative work or work related to
Freshway’s motion for summary adjudication, which the court
determined was not sufficiently related to its receiving stolen
property claim. The court excluded those hours from its lodestar
calculation when it found that Freshway’s attorneys reasonably
spent 1,750 hours working on matters concerning the company’s
receiving stolen property claim and its related causes of action.
(See Thayer v. Wells Fargo Bank, N.A. (2001) 92 Cal.App.4th 819,
843–844 [a trial court should exclude from its lodestar calculation
attorney hours spent working on duplicative matters].)
Defendants have not shown the court abused its discretion in
reaching that figure.
5.4. Redacted billing invoices
Defendants argue the court erred when it admitted
Freshway’s redacted billing invoices. This argument also lacks
merit.
A court does not abuse its discretion when it awards
attorney fees where the plaintiff has submitted billing records
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that have been heavily redacted. (Rancho Mirage, supra,
2 Cal.App.5th at pp. 263–264.) Unlike some other jurisdictions,
California “does not require detailed billing records to support a
fee award.” (Id. at p. 263.) An “ ‘attorney’s testimony as to the
number of hours worked is sufficient evidence to support an
award of attorney fees, even in the absence of detailed time
records.’ ” (Ibid.)
Although Freshway redacted from most of its billing
invoices the descriptions of the nature of work performed by its
attorneys, the invoices show the hours billed, and the hourly
rates charged, for each attorney who billed Freshway. In
addition, Park testified about the type of work Freshway’s
attorneys performed in connection with this lawsuit, and he
provided a summary of the types of work the billing invoices
covered throughout the course of this lawsuit. The court did not
abuse its discretion by relying on this evidence when calculating
Freshway’s fee award. (Rancho Mirage, supra, 2 Cal.App.5th at
pp. 263–264.)
5.5. Negative lodestar multiplier
Finally, defendants contend the court should have applied
a negative multiplier to Freshway’s lodestar figure. Specifically,
defendants argue the court should have reduced the lodestar
figure because: (1) Freshway requested an inflated fee award;
(2) Freshway’s billing records include several “numerical
oddities,” such as one attorney allegedly recording a
disproportionate number of billing entries that end in “.30” hours
worked; and (3) Freshway miscalculated the amount of its initial
request for attorney fees. These arguments lack merit.
As for defendants’ first two points, they are forfeited
because, like several of defendants’ other arguments, they are not
24
accompanied by citations to the record where facts supporting
the claims of error appear. (Keyes, supra, 189 Cal.App.4th at
pp. 655–656.) As for defendants’ third point, it is true that
Freshway miscalculated the total number of fees it initially
requested in its attorney fees motion. But the company
acknowledged the miscalculation after defendants pointed it out
and reduced the amount of fees it requested when it filed its reply
brief. The court noted the reduced request in its order awarding
attorney fees, and it did not find that Freshway intentionally
miscalculated its initial request or otherwise engaged in any
inappropriate conduct with respect to its attorney fees motion.
In any event, it is well-settled that application of a positive
or negative lodestar multiplier is completely discretionary.
(Ketchum, supra, 24 Cal.4th at p. 1138; Snoeck v. ExakTime
Innovations, Inc. (2023) 96 Cal.App.5th 908, 920.) Nothing in the
record shows the court abused its discretion by not applying a
negative multiplier to Freshway’s lodestar figure.
As we explained above, the court considered Freshway’s
evidence supporting the attorney fees motion when it calculated
the lodestar figure, and it awarded Freshway an amount of fees
that was significantly lower than the amount that Freshway
requested. In calculating its lodestar figure, the court reduced
the hourly rate requested, and the total hours billed, by
Freshway’s attorneys. The court reasonably could have
concluded that because it reduced both Freshway’s requested
hourly rate and total hours billed in calculating the lodestar
figure, it did not also need to apply a negative multiplier to that
figure.
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DISPOSITION
The judgment and postjudgment attorney fee award are
affirmed. Freshway shall recover its costs on appeal.
VIRAMONTES, J.
WE CONCUR:
GRIMES, Acting P. J.
WILEY, J.
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