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Ellis Law Group, LLP v. Nevada City Sugar Loaf Properties, LLC

California Court of Appeals, Third District, Sacramento

October 3, 2014

ELLIS LAW GROUP, LLP, Plaintiff, Cross-defendant and Respondent,
v.
NEVADA CITY SUGAR LOAF PROPERTIES, LLC, Defendant, Cross-complainant and Appellant.

[As Modified October 22, 2014]

APPEAL from a judgment of the Superior Court of Sacramento County, No. 34201000067737CUBCGDS Shelleyanne W.L. Chang, Judge.

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[Copyrighted Material Omitted]

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[Copyrighted Material Omitted]

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[Copyrighted Material Omitted]

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COUNSEL

LAW OFFICES OF KRISS HALPERN and Kriss S. Halpern for Defendant, Cross-complainant and Appellant.

ELLIS LAW GROUP, Mark E. Ellis, Ronald R. Poirier and Elizabeth Handelin for Plaintiff, Cross-defendant and Respondent.

OPINION

HOCH, J.

This case illustrates that “[a]ll too often attorney fees become the tail that wags the dog in litigation.” (Deane Gardenhome Assn. v. Denktas (1993) 13 Cal.App.4th 1394, 1399 [16 Cal.Rptr.2d 816].) Here, Nevada City Sugar Loaf Properties LLC (Sugar Loaf) challenges an award of $14, 553.50 in attorney fees to Ellis Law Group LLP (ELG) as the prevailing party on a special motion to strike pursuant to Code of Civil Procedure section 425.16 (anti-SLAPP motion). Sugar Loaf contends the trial court erred in awarding attorney fees for work on the anti-SLAPP motion performed by attorney Joseph R. Major because Major was a member of ELG on whose behalf the motion was filed. Relying on case law holding self-represented law firms may not be awarded attorney fees for an anti-SLAPP motion, Sugar Loaf argues the fee award must be reversed.

ELG counters that Major acted as an independent contractor to that law firm because he had no billable hour requirements, did not accrue vacation time, received no health care benefits, and was paid by the hour without deduction for taxes. The trial court agreed with ELG that Major’s status as an independent contractor to ELG allowed the law firm to receive attorney fees under the anti-SLAPP statute.

We conclude the trial court erred in awarding fees to ELG under the anti-SLAPP statute. With only a single exception, Major was listed as a member of ELG in the caption of documents filed in support of ELG’s anti-SLAPP motion. Moreover, Major signed documents for ELG’s anti-SLAPP motion as an attorney with ELG. Major did not file a notice of association or substitution to indicate he was acting as outside counsel to ELG. And, when Major contacted opposing counsel regarding the filing of a document concerning the anti-SLAPP motion, he used an e-mail address and signature that identified him as a member of ELG. The possibility that Major was paid in a manner different than a regular “employee” of ELG may render him an independent contractor for taxation purposes, but does not make him

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separate counsel for ELG for purposes of attorney fees under the anti-SLAPP statute. Accordingly, we reverse.[1]

FACTUAL AND PROCEDURAL HISTORY

Anti-SLAPP Motion Granted in Favor of ELG

In December 2010, a second amended cross-complaint was filed by the law firm of ELP for unpaid legal fees owed by Marison M. Mull, George W. M. Mull, and Nevada City Sugar Loaf Properties. In August 2011, plaintiff filed a notice of change of law firm name to ELG. In September 2011, Sugar Loaf filed a cross-complaint for breach of fiduciary duty.

On November 16, 2011, “Mark E. Ellis, Ronald R. Poirier, and Joseph R. Major, attorneys of record” filed a notice they were associating the Law Offices of Larry Lockshin as co-counsel for ELG. Also on November 16, 2011, ELG filed an anti-SLAPP motion to Sugar Loaf’s cross-complaint. Lockshin was not listed as counsel for the anti-SLAPP motion. Instead, the caption for the notice of the anti-SLAPP motion listed Mark E. Ellis, Ronald Poirier, and Joseph R. Major as attorneys for ELG. Although the accompanying memorandum of points and authorities for the motion listed only Ellis and Poirier as counsel for ELG, Major was included as an ELG attorney in the caption on the following documents: Ellis’s declaration in support of the anti-SLAPP motion, Poirier’s declaration in support of the motion, the proof of service for the initial anti-SLAPP documents, and notice of errata for the anti-SLAPP motion documents.

On December 19, 2011, Major sent an e-mail to counsel for Sugar Loaf in which he sought a stipulation for ELG’s request to file an oversize reply brief. The signature of the e-mail read: “Joseph R. Major [¶] Contract Attorney [¶] Ellis Law Group LLP.” The e-mail address used by Major was “jmajor@ellislawgrp.com.”

Major’s name again appeared as an attorney with ELG in the caption of a request to file an oversize reply brief to Sugar Loaf’s opposition to the anti-SLAPP motion. Major signed the request, “Joseph R. Major [¶] Attorney for Plaintiff/Cross-Defendant [¶] ELLIS LAW GROUP, LLP.” In the accompanying declaration, Major declared: “I am a contract attorney at the Ellis Law Group, LLC.” Major was included as an ELG member on the caption of the reply to Sugar Loaf’s opposition and the caption on the proposed order for granting the anti-SLAPP motion.

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Sugar Loaf opposed the anti-SLAPP motion, which was granted ...


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