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SUPERIOR COURT OF CALIFORNIA
COUNTY OF SANTA BARBARA
Dated and Entered: 02/06/2023 Time: 10:00 AM
Judicial Officer: Colleen K Sterne
Deputy Clerk: Danae Chauvin-Couture Dept: SB Dept 5
Deputy Sheriff: None
Court Reporter: Shelley Cockrell Case No: 20CV04285
Jonas Svensson vs iO73 Investments Inc et al
Parties Present:
Stephen Ram Attorney for Plaintiff (in person)
Naomi Dewey Attorney for Defendant (via Zoom)
NATURE OF PROCEEDINGS: Hearing: Return on Remittitur; Motion: Attorney Fees
The matter proceeded via Zoom.
Counsel provided oral argument.
The Court adopted the tentative ruling as follows:
RULING: The motion is granted. The court awards attorney fees in favor of Jonas Svensson against i073
and Tristan Strauss in the amount of $87,591.50. The court confirms costs on appeal of $148.50.
Background: Petitioner Jonas Svensson (“Svensson”) is a current shareholder and director of
respondent i073 Investments, Inc. (“i073”), an investment management company that buys, manages,
and sells stocks, bonds, and other securities for investors. Svensson is the former Executive Chairman of
i073. Respondent Tristan Strauss (“Strauss”) is also a shareholder and director of i073. In December
2019, Svensson was terminated from his position as Executive Chairman of i073, allegedly “for cause”
for breaching his employment contract and engaging in dishonesty relating to his salary. Svensson
denies the allegations and claims that Strauss decided to terminate him in order to deprive him of
benefits under his employment contract and to have his vested shares in i073 subject to a purchase
option by the other shareholders.
On December 18, 2020, Svensson filed a petition for writ of mandate to compel i073 and Strauss to
permit Svensson to inspect and copy the books and records of the Headwaters Group, a collection of
subsidiary corporations owned and operated by i073. Earlier, Svensson had initiated an action against
Strauss and i073, Santa Barbara Superior Court Case No. 20CV01556, Jonas Svensson, individually
and derivatively on behalf of i073 Investments, Inc. v. i073 Investments, Inc., et al. for breach of
employment agreement, breach of stock award agreement, breach of shareholders’ agreement, breach
of fiduciary duty, and declaratory relief (the “Related Case”). On July 27, 2020, the court in the Related
Case entered an order enjoining i073 and Strauss from implementing a forced sale of Svensson’s shares
of the company pending resolution of the case. The Related Case is ongoing.
On September 3, 2021, the court entered its ruling on Svensson’s request for writ of mandate, ordering
respondents to produce for inspection and copying the two remaining categories of documents of the
Page 1 of 3
SC-2411 (Revised July 1, 2013) MINUTE ORDER
20CV04285 Svensson vs i073 Investments
February 6, 2023
Page 2 of 3
Headwaters Group at issue: (1) documents relating to the issue of additional new owners of the
Headwaters Group and (2) a capitalization table and materials related to capitalization calculations.
(Ruling, filed Sept. 3, 2021.)
An appeal of the ruling was filed by i073 and Strauss. The appeals court affirmed the judgment and
remanded the matter to this court with “directions to award [Svensson] his reasonable appellate attorney
fees, which shall be payable by i073 pursuant to [Corporations Code] section 1604. Respondent shall
recover his costs on appeal from both appellants. (Cal. Rules of Court, rule 8.278.)” (Decision on Appeal,
filed Aug. 16, 2022.) Remittitur was filed on October 27, 2022.
Svensson now moves for attorney fees and costs incurred.
ANALYSIS:
Corporations Code section 1604 provides: “In any action or proceeding under Section 1600 or Section
1601, if the court finds the failure of the corporation to comply with a proper demand thereunder was
without justification, the court may award an amount sufficient to reimburse the shareholder or holder of a
voting trust certificate for the reasonable expenses incurred by such holder, including attorneys' fees, in
connection with such action or proceeding.”
“[T]he fee setting inquiry in California ordinarily begins with the ‘lodestar,’ i.e., the number of hours
reasonably expended multiplied by the reasonable hourly rate. ‘California courts have consistently held
that a computation of time spent on a case and the reasonable value of that time is fundamental to a
determination of an appropriate attorneys’ fee award.’ [citation] The reasonable hourly rate is that
prevailing in the community for similar work. [citation] The lodestar figure may then be adjusted, based
on consideration of factors specific to the case, in order to fix the fee at the fair market value for the legal
services provided. [citation] Such an approach anchors the trial court’s analysis to an objective
determination of the value of the attorney’s services, ensuring that the amount awarded is not arbitrary.
[citation].” (PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1095.)
“[T]he verified time statements of the attorneys, as officers of the court, are entitled to credence in the
absence of a clear indication the records are erroneous.” (Horsford v. Board of Trustees of California
State University (2005) 132 Cal.App.4th 359, 396.)
“[T]rial courts must carefully review attorney documentation of hours expended” in assessing reasonable
and necessary attorney fees. (Ketchum v. Moses (2001) 24 Cal.4h 1122, 1132.)
“[T]he [party] ... seeking fees and costs ‘bear[s] the burden of establishing entitlement to an award and
documenting the appropriate hours expended and hourly rates.’ [Citation.]’” (Christian Research Institute
v. Alnor (2008) 165 Cal.App.4th 1315, 1320.) “To that end, the court may require [a] defendant . . . to
produce records sufficient to provide ‘a proper basis for determining how much time was spent on
particular claims.’ [Citation.]” (Ibid.) “The evidence should allow the court to consider whether the case
was overstaffed, how much time the attorneys spent on particular claims, and whether the hours were
reasonably expended. [Citation.]” (Ibid.)
SC-2411 (Revised July 1, 2013) MINUTE ORDER
20CV04285 Svensson vs i073 Investments
February 6, 2023
Page 3 of 3
Svensson seeks an hourly rate of $742.50 for attorney Stephen Ram. Ram is a shareholder Stradling
Yocca Carlson & Rauth and has 17 years of experience in securities and complex business and
commercial litigation in federal and state courts across the country. (Ram Dec., ¶ 9.) Ram received his
law degree from Loyola Law School in 2005. (Ram Dec., ¶ 9 & Exh. 6.) Ram’s typical hourly rate for
matters such as the present is $850.00 and he believes that the rate is similar to those of other attorneys
with comparable experience practicing securities and complex business law in Southern California,
particularly for shareholder disputes. (Ram Dec., ¶ 11.) Svensson received a discounted effective hourly
rate of $742.50 for Ram’s time spent. (Ram Dec., ¶ 12.)
Svensson seeks an hourly rate of $436.50 for third-year associate Nicole Carbonel. Carbonel received
her law degree from the University of California, Irvine School of Law in 2019. (Ram Dec., ¶ 10 & Exh. 7.)
Carbonel’s typical hourly rate for matters such as the present is $485.00 and Ram believes that the rate
is similar to those of other attorneys with comparable experience practicing securities and complex
business law in Southern California, particularly for shareholder disputes. (Ram Dec., ¶ 11.) Svensson
received a discounted effective hourly rate of $436.50 for Carbonel’s time spent. (Ram Dec., ¶ 12.)
i073 and Strauss do not contest that Svensson is entitled to attorney fees and costs on appeal. Rather,
he argues that the fees sought are not reasonable in that hourly rate is much too high, the amount of
time spent was not reasonable, and that much of the time spent on the case was duplicative with Ram
and Carbonel billing for identical work. i073 and Strauss’s claims, in this regard, are conclusory and not
supported by any evidence. In reply to the opposition, Ram sets forth the method and approach that he
and Carbonel took to the litigation and explains why the rates are reasonable, why the time spent was
necessary, and why the documented hours were not duplicative.
The court has carefully reviewed Ram’s declaration and the attached evidence including the billing
records. In light of the complexities of the appeal, initiated by i073 and Strauss, the court finds that the
documented time was reasonably necessary in effectively responding to the appeal and the rate charged
is within a reasonable range. As such, the motion for attorney fees will be granted. Costs on appeal in
the amount of $148.50 will be confirmed.
DARREL E. PARKER, EXECUTIVE OFFICER Minutes Prepared by:
Danae Chauvin-Couture , Deputy
SC-2411 (Revised July 1, 2013) MINUTE ORDER
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SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA BARBARA Dated and Entered: 02/06/2023 Time: 10:00 AM Judicial Officer: Colleen K Sterne Deputy Clerk: Danae Chauvin-Couture Dept: SB Dept 5 Deputy Sheriff: None Court Reporter: Shelley Cockrell Case No: 20CV04285 Jonas Svensson vs iO73 Investments Inc et al Parties Present: Stephen Ram Attorney for Plaintiff (in person) Naomi Dewey Attorney for Defendant (via Zoom) NATURE OF PROCEEDINGS: Hearing: Return on Remittitur; Motion: Attorney Fees The matter proceeded via Zoom. Counsel provided oral argument. The Court adopted the tentative ruling as follows: RULING: The motion is granted. The court awards attorney fees in favor of Jonas Svensson against i073 and Tristan Strauss in the amount of $87,591.50. The court confirms costs on appeal of $148.50. Background: Petitioner Jonas Svensson (“Svensson”) is a current shareholder and director of respondent i073 Investments, Inc. (“i073”), an investment management company that buys, manages, and sells stocks, bonds, and other securities for investors. Svensson is the former Executive Chairman of i073. Respondent Tristan Strauss (“Strauss”) is also a shareholder and director of i073. In December 2019, Svensson was terminated from his position as Executive Chairman of i073, allegedly “for cause” for breaching his employment contract and engaging in dishonesty relating to his salary. Svensson denies the allegations and claims that Strauss decided to terminate him in order to deprive him of benefits under his employment contract and to have his vested shares in i073 subject to a purchase option by the other shareholders. On December 18, 2020, Svensson filed a petition for writ of mandate to compel i073 and Strauss to permit Svensson to inspect and copy the books and records of the Headwaters Group, a collection of subsidiary corporations owned and operated by i073. Earlier, Svensson had initiated an action against Strauss and i073, Santa Barbara Superior Court Case No. 20CV01556, Jonas Svensson, individually and derivatively on behalf of i073 Investments, Inc. v. i073 Investments, Inc., et al. for breach of employment agreement, breach of stock award agreement, breach of shareholders’ agreement, breach of fiduciary duty, and declaratory relief (the “Related Case”). On July 27, 2020, the court in the Related Case entered an order enjoining i073 and Strauss from implementing a forced sale of Svensson’s shares of the company pending resolution of the case. The Related Case is ongoing. On September 3, 2021, the court entered its ruling on Svensson’s request for writ of mandate, ordering respondents to produce for inspection and copying the two remaining categories of documents of the Page 1 of 3 SC-2411 (Revised July 1, 2013) MINUTE ORDER 20CV04285 Svensson vs i073 Investments February 6, 2023 Page 2 of 3 Headwaters Group at issue: (1) documents relating to the issue of additional new owners of the Headwaters Group and (2) a capitalization table and materials related to capitalization calculations. (Ruling, filed Sept. 3, 2021.) An appeal of the ruling was filed by i073 and Strauss. The appeals court affirmed the judgment and remanded the matter to this court with “directions to award [Svensson] his reasonable appellate attorney fees, which shall be payable by i073 pursuant to [Corporations Code] section 1604. Respondent shall recover his costs on appeal from both appellants. (Cal. Rules of Court, rule 8.278.)” (Decision on Appeal, filed Aug. 16, 2022.) Remittitur was filed on October 27, 2022. Svensson now moves for attorney fees and costs incurred. ANALYSIS: Corporations Code section 1604 provides: “In any action or proceeding under Section 1600 or Section 1601, if the court finds the failure of the corporation to comply with a proper demand thereunder was without justification, the court may award an amount sufficient to reimburse the shareholder or holder of a voting trust certificate for the reasonable expenses incurred by such holder, including attorneys' fees, in connection with such action or proceeding.” “[T]he fee setting inquiry in California ordinarily begins with the ‘lodestar,’ i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate. ‘California courts have consistently held that a computation of time spent on a case and the reasonable value of that time is fundamental to a determination of an appropriate attorneys’ fee award.’ [citation] The reasonable hourly rate is that prevailing in the community for similar work. [citation] The lodestar figure may then be adjusted, based on consideration of factors specific to the case, in order to fix the fee at the fair market value for the legal services provided. [citation] Such an approach anchors the trial court’s analysis to an objective determination of the value of the attorney’s services, ensuring that the amount awarded is not arbitrary. [citation].” (PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1095.) “[T]he verified time statements of the attorneys, as officers of the court, are entitled to credence in the absence of a clear indication the records are erroneous.” (Horsford v. Board of Trustees of California State University (2005) 132 Cal.App.4th 359, 396.) “[T]rial courts must carefully review attorney documentation of hours expended” in assessing reasonable and necessary attorney fees. (Ketchum v. Moses (2001) 24 Cal.4h 1122, 1132.) “[T]he [party] ... seeking fees and costs ‘bear[s] the burden of establishing entitlement to an award and documenting the appropriate hours expended and hourly rates.’ [Citation.]’” (Christian Research Institute v. Alnor (2008) 165 Cal.App.4th 1315, 1320.) “To that end, the court may require [a] defendant . . . to produce records sufficient to provide ‘a proper basis for determining how much time was spent on particular claims.’ [Citation.]” (Ibid.) “The evidence should allow the court to consider whether the case was overstaffed, how much time the attorneys spent on particular claims, and whether the hours were reasonably expended. [Citation.]” (Ibid.) SC-2411 (Revised July 1, 2013) MINUTE ORDER 20CV04285 Svensson vs i073 Investments February 6, 2023 Page 3 of 3 Svensson seeks an hourly rate of $742.50 for attorney Stephen Ram. Ram is a shareholder Stradling Yocca Carlson & Rauth and has 17 years of experience in securities and complex business and commercial litigation in federal and state courts across the country. (Ram Dec., ¶ 9.) Ram received his law degree from Loyola Law School in 2005. (Ram Dec., ¶ 9 & Exh. 6.) Ram’s typical hourly rate for matters such as the present is $850.00 and he believes that the rate is similar to those of other attorneys with comparable experience practicing securities and complex business law in Southern California, particularly for shareholder disputes. (Ram Dec., ¶ 11.) Svensson received a discounted effective hourly rate of $742.50 for Ram’s time spent. (Ram Dec., ¶ 12.) Svensson seeks an hourly rate of $436.50 for third-year associate Nicole Carbonel. Carbonel received her law degree from the University of California, Irvine School of Law in 2019. (Ram Dec., ¶ 10 & Exh. 7.) Carbonel’s typical hourly rate for matters such as the present is $485.00 and Ram believes that the rate is similar to those of other attorneys with comparable experience practicing securities and complex business law in Southern California, particularly for shareholder disputes. (Ram Dec., ¶ 11.) Svensson received a discounted effective hourly rate of $436.50 for Carbonel’s time spent. (Ram Dec., ¶ 12.) i073 and Strauss do not contest that Svensson is entitled to attorney fees and costs on appeal. Rather, he argues that the fees sought are not reasonable in that hourly rate is much too high, the amount of time spent was not reasonable, and that much of the time spent on the case was duplicative with Ram and Carbonel billing for identical work. i073 and Strauss’s claims, in this regard, are conclusory and not supported by any evidence. In reply to the opposition, Ram sets forth the method and approach that he and Carbonel took to the litigation and explains why the rates are reasonable, why the time spent was necessary, and why the documented hours were not duplicative. The court has carefully reviewed Ram’s declaration and the attached evidence including the billing records. In light of the complexities of the appeal, initiated by i073 and Strauss, the court finds that the documented time was reasonably necessary in effectively responding to the appeal and the rate charged is within a reasonable range. As such, the motion for attorney fees will be granted. Costs on appeal in the amount of $148.50 will be confirmed. DARREL E. PARKER, EXECUTIVE OFFICER Minutes Prepared by: Danae Chauvin-Couture , Deputy SC-2411 (Revised July 1, 2013) MINUTE ORDER