Pony v. County of Los Angeles

433 F.3d 1138, 2006 WL 51171
CourtCourt of Appeals for the Ninth Circuit
DecidedJanuary 10, 2006
Docket03-56855
StatusPublished
Cited by23 cases

This text of 433 F.3d 1138 (Pony v. County of Los Angeles) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Pony v. County of Los Angeles, 433 F.3d 1138, 2006 WL 51171 (9th Cir. 2006).

Opinion

BYBEE, Circuit Judge:

The issue before us is whether a plaintiff bringing suit under 42 U.S.C. § 1983 can assign her right to seek attorney’s fees to her attorney. We answer that she may not, and we affirm the judgment of the district court.

I. FACTS AND PROCEDURAL HISTORY

On March 19, 2002, Wilma Pony, the legal guardian of Paulette Pony, a minor, filed suit against the County of Los Angeles (the “County”) and various employees of the Los Angeles Juvenile Alternative Work Program (“JAWS”) in the United States District Court for the Central District of California. The complaint alleged that Pony was a victim of various traditional torts and constitutional violations arising out of medical procedures she was subjected to by JAWS employees on April 24, 2001.

On March 4, 2002, Pony entered into a retainer agreement with attorneys Michael Mitchell and David Margulies. The agreement contained the following provision:

Client agrees to and hereby does irrevocably assign and transfer to Attorneys all of Client’s rights and powers, whether contingent or vested or both, (a) to waive “prevailing party” status, (b) to waive, apply for, obtain judgment upon, collect, and/or receive any statutory attorney’s fee award, and (c) to make and/or accept a “lump sum, including all attorney’s fees” settlement offer. Client acknowledges and agrees that the foregoing assignment and transfer may make it more difficult for Client to settle the case, because Client will not possess the powers or rights to waive “prevailing party” status or the powers or rights to waive, apply for, obtain judgment upon, collect, and/or receive any attorney’s fee award. Client hereby authorizes and directs the court to make any such attorney fee award and judgment thereon in Attorneys’ names only and not in Client’s name. In the event that a right to apply for statutory attorney’s fees survives settlement or judgment respecting Client’s claims, Attorneys will negotiate and seek agreement from Defendants upon the amount of statutory attorney’s fees to be paid by Defendants; otherwise Attorneys will apply for statutory attorneys fees.

(emphasis in original). The agreement also provided that the attorneys would receive the greater of one-third of the gross amount of the award (forty percent if set *1141 tlement was reached within sixty days of trial), or statutory attorney’s fees.

Mitchell began representing Pony and continued to do so through discovery and pre-trial motions. Problems arose during the course of settlement negotiations, however. The County offered to settle Pony’s claim for a “lump sum, including all attorney’s fees” figure. Mitchell wrote a letter to the County’s attorneys stating that if the County made a “lump sum, including all attorney’s fees” offer which was acceptable to Pony, “it will perforce be in abrogation of my rights under the retainer agreement and I will be legally and ethically powerless to resist it.” Citing California Business and Professions Code Section 6128(b), which makes it a misdemeanor for an attorney to “willfully delay[ ] his client’s suit with a view to his own gain,” Mitchell said that such a settlement offer “will force me to resign as plaintiffs counsel because of the conflict it creates.” Mitchell also advised the County that if such a settlement were reached, he intended to seek statutory attorney’s fees pursuant to his rights under his retainer agreement with Pony. He also declared his intent to pursue other claims, such as a claim for intentional interference with contractual relations. 1

Nonetheless, settlement negotiations continued, and a week later Mitchell signed an attorney substitution making co-counsel, David Margulies, Pony’s sole counsel of record. The substitution was filed two weeks later. The day before it was filed, Pony and the County reached a tentative settlement agreement whereby Pony received $29,999.99 in exchange for release of all of her claims against the County and a waiver of her right to seek attorney’s fees.

The tentative settlement was disrupted by Mitchell, who reiterated his intentions to pursue statutory attorney’s fees from the County despite the settlement. Following Mr. Mitchell’s formal request to the court for fees and a June 9, 2003, hearing on the issue of attorney’s fees, the district court concluded that the case had not yet been settled and scheduled the case for trial.

Prior to trial, Pony and the County reached a firm settlement, with Pony releasing all of her claims against the County in exchange for $29,999.99. The settlement was inclusive of all attorney’s fees, “notwithstanding any statutory or contractual rights which plaintiffs present or former counsel may have or have had and *1142 notwithstanding any language in the retainer agreement between plaintiff and her present or former counsel.” As part of the settlement, however, Pony and Margulies had to agree to indemnify the County against any fees or costs sought by Mitchell. The court dismissed Pony’s suit on account of settlement on July 16, 2003.

In response to the dismissal, Mitchell filed two motions: a Motion for Relief from Order, alleging that the court’s dismissal of the suit was by mistake or inadvertence, and a motion for attorney’s fees. The district court ruled that Mitchell lacked standing, and denied both motions. He now appeals.

II. ANALYSIS

A. Mitchell’s Standing to Seek Attorney’s Fees 2

Successful plaintiffs in civil rights suits may seek attorney’s fees from the losing defendant. Under 42 U.S.C. § 1988(b), “[i]n any action or proceeding to enforce a provision of [42 U.S.C. § 1983] ..., the court, in its discretion, may allow the prevailing party ... a reasonable attorney’s fee as part of the costs.... ”

The Supreme Court has held that Section 1988 vests the right to seek attorney’s fees in the prevailing party, not her attorney, and that attorneys therefore lack standing to pursue them. Evans v. Jeff D., 475 U.S. 717, 730-32, 106 S.Ct. 1531, 89 L.Ed.2d 747 (1986); see also Venegas v. Mitchell, 495 U.S. 82, 88, 110 S.Ct. 1679, 109 L.Ed.2d 74 (1990); Churchill Vill., L.L.C. v. Gen. Elec., 361 F.3d 566, 579 (9th Cir.2004); United States ex rel. Virani v. Jerry M. Lewis Truck Parts & Equip., Inc., 89 F.3d 574, 577 (9th Cir. 1996); Willard v. City of Los Angeles, 803 F.2d 526, 527 (9th Cir.1986). Once the prevailing party exercises her right to receive fees, the attorney’s right to collect them vests, and he may then pursue them on his own. Virani, 89 F.3d at 578.

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Pony v. County of Los Angeles
433 F.3d 1138 (Ninth Circuit, 2006)

Cite This Page — Counsel Stack

Bluebook (online)
433 F.3d 1138, 2006 WL 51171, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pony-v-county-of-los-angeles-ca9-2006.