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The California Supreme Court ruled Monday that a million-dollar attorney fee award belongs to … well, the attorneys. The justices ruled 5-1 that a state anti-discrimination statute that authorizes the award of attorneys’ fees does so to compensate for legal services — not to further enrich the litigant. “We conclude that, absent proof on remand of an enforceable agreement to the contrary, the attorney fees awarded in this case belong to the attorneys who labored to earn them,” wrote Justice Kathryn Mickle Werdegar. Chief Justice Ronald George and Justices Marvin Baxter, Ming Chin and Janice Rogers Brown concurred in Flannery v. Prentice, 01 C.D.O.S. 6991. In dissent Justice Joyce Kennard said the plain language of the statute authorized the court to award reasonable attorneys’ fees “to the prevailing party.” “According to the majority, however, the statute does not mean what it says: ‘prevailing party’ does not mean prevailing party but prevailing lawyer,” Kennard wrote. “That construction ignores the plain language of the statute as well as persuasive United States Supreme Court precedent construing virtually identical language in the federal civil rights law.” The case stemmed from Leslie Flannery’s successful sexual harassment suit against her former employer, the California Highway Patrol. An Alameda County jury awarded her $250,000. The fee dispute arose after now-retired Judge Demetrios Agretelis awarded Flannery’s lawyers, John Prentice and John Scott, more than $1 million in attorneys’ fees. Flannery then sued her lawyers for breach of contract, saying she had an oral agreement with her lawyers that called for her to give them “40 percent of the net settlement or net award of the jury.” The lawyers countered that the oral agreement called for them to receive 40 percent of a jury verdict or the entirety of any statutory fees that might be awarded. California’s First District Court of Appeal reversed Agretelis, saying the statutory fees belonged to Flannery as the prevailing party. In her opinion reversing yet again, Werdegar concluded that statutory fees “exceeding fees the client already has paid belong, absent a contractual agreement validly disposing of them, to the attorneys for whose work they are awarded.” Werdegar said federal law does not control the state’s construction of the attorney fee provision in question, which is part of the California Fair Employment and Housing Act. Rather, Werdegar relied on state precedent, including a 1982 state supreme court decision in which the justices ruled that fees from a private attorney general action belonged to the plaintiffs’ attorneys rather than to the plaintiffs themselves. Werdegar also said her conclusion followed the legislative intent behind fee statutes, which she said were meant to draw lawyers to cases of public significance that didn’t promise large damage awards. “Attorneys considering whether to undertake cases that vindicate fundamental public policies may require statutory assurance that, if they obtain a favorable result for their client, they will actually receive the reasonable attorney fees provided for by the Legislature and computed by the court,” Werdegar wrote. Prentice echoed Werdegar’s thoughts. “Thousands if not tens of thousands of people in the future,” he said, “will be able to find attorneys to take their cases.”

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