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FILED
APR x1Q 2019
OCOOVQK/IALAN...
SUPERIOR COURT OF CALIFORNIA
COUNTY OF SANTA CLARA
MICHAEL HANNEKEN,
Case No. 16-CV-300285
Plaintiff,
Order on Plaintiff‘s Motion to Tax Costs
vs.
LELAND STANFORD JUNIOR UNIVERSITY,
WILLIAM J. PERRY,
Defendants.
On February l 1,2019, after less than an hour ofdeliberation, thejury rendered a verdict
in Defendants’ favor in the liability stage ofa bifurcated trial. Following entry ofjudgment 0n
February 13, 2019,
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Defendants filed a Memorandum of Costs on February 22, 201 9, seeking to
recover costs in the amount of $228,005.56. Although not required to do so, Defendants filed
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with the Memorandum of Costs a Declaration of Andrew Lanphere dated February 22, providing
factual support and documentation relating to the Memorandum of Costs.
On March 11, 2019, Plaintifffiled a Motion t0 Tax Costs, challenging five items 0n the
Memorandum of Costs: 1)expert witness fees; 2) court reporter fees; 3) deposition costs; 4)
messenger fees; and 5) courtroom technology equipment. The motion was supported by a
Declaration of Tyler Atkinson whieh addressed only the expert fees and the technology
equipment. Defendants’ opposition included another Lanphere Declaration dated April 3.
Plaintifffiled a reply memorandum and objections to both Lanphere Declarations. The motion
was argued and submitted on April 16, 201 9.
_..
l. Expert Witness Fees
On July 5, 20] 8, Defendants served an Offer to Compromise pursuant to Code of Civil
Procedure section 998, offering to pay Plaintiff $1 00,000 plus costs incurred to date in exchange
for a dismissal with prejudice. Plaintiff made no response to the Offer.
Although fees of expert witnesses not ordered by the court are expressly disallowed
under Code of Civil under section
OOOOQO‘UIADJN
Procedure section 1033.5(b)(1), the court has the discretion
998 to award expert witness fees as costs. Plaintiff does not dispute that the Offer to
Compromise was procedurally proper and reasonable.
Defendants seek to recover $167,597.63 inexpert witness fees. Plaintiff does not
challenge $8,739.33 Defendants paid to Plaintiff’s experts for time spent in deposition, but .
axgues that the balance of$158,858.30 should be taxed.
’
a. Defendants evidence and Plaintiff’s objections
The Lanphere Declarations establish, without objection from Plaintiff, that the amount of
Plaintiff’s claimed damages was up to $1 7,250,323; that Plaintiff’s damages expert Susan
Heinemann prepared six lost-profits projections; and that given the extremely large sum sought
by Plaintiff, the damages claim required a thorough and careful response by Defendants.
(Lanphere Declarations, at 2: 18-27, paragraph 10.) The Declarations also establish without
'
objection that Defendants retained and disclosed as expert witnesses Steve Hazel and Greg
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Gotthardt, both of FTI Consulting, and specify the related and distinct areas of their expected
testimony.
OONQUIAwN—OOOOVQUIAWNfl
(Id., at 2: 8-1 7, paragraph 9.)
Plaintiff’s evidentiary objections all relate solely to the expert witness fees: paragraphs
l1-15 of the Lanphere Declarations (paragraphs ll-14 appear in both declarations, and 15 only
in the April 3 Declaration) and “purported time records and billing entries” (Plaintiff‘s
Objections to Evidence, at 2: l3). Although Plaintiff’s Objections describe Exhibit G to both
Declarations as being the same documents, Plaintiff’s description corresponds only t0 Exhibit G
to the April 3 Declaration and not to Exhibit G to the February 22 Declaration. At the hearing,
Plaintiffconfirmed that he intended t0 object to FTl Consulting invoices in the form attached as
Exhibit E to the February 22 Declaration and as Exhibit G to the April 3 Declaration.
(l) Paragraph ll and invoices:
The Declarations state the totalamount paid to experts, identify a discount applied to
billings, and state that the invoices are redacted t0 remove tax infomation and are otherwise true
and correct copies. ‘Plaintiffobjects that “[c]ounsel fails to establish that invoices and time
records attached as Exhibit G are true and correct copies” (Plaintiff‘s Objections, at 3: 8-9 and 5:
OWOONQU‘IADJNH
5-6), but the Declarations specifically address this issue. (February 22 Declaration, at 3: 6-8;
April 3 Declaration, at 3: 6-8.) Plaintiff also objects that counsel lacks personal knowledge to
authenticate these documents, the invoices are hearsay, and counsel’s statement about a discount
is hearsay.
(2) Paragraph 12:
The Declarations recount the chronology of discovery and trialpreparation, and explain
why the expens’ work was important and necessary. Plaintiff objects that counsel is not
qualified to give an opinion and that the statements about work done by experts are hearsay. No
objection is made to counsel’s chronology ofdiscovery and trial preparation.
(3) Paragraph 13:
The Declarations describe in detail the work done by the experts. Plaintiff objects that
counsel is not qualified to give an opinion and that the statements about work done by experts
are hearsay.
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(4) Paragraph l4:
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The Declarations state that the rates for Mr. Hazel and Mr. Gotthardt were discounted.
Plaintiff objects that counsel lacks personal knowledge and on the ground of hearsay.
(5) Paragraph 15:
The April 3 Declaration states the usual hourly rates and the discounted rates. Plaintiff
objects that counsel lacks personal knowledge and on the ground of hearsay.
At the hearing, Plaintiff argued that no declarations were provided from the experts
themselves. Plaintiffdoes not explain why counsel familiar with the legal issues and working
closely with an expert is not the appropriate person to opine as to the importance and
reasonableness of the expert’s work. Plaintiff provides no authority holding that objections of
the nature he has asserted are well taken in this procedural context.
AWN To the contrary, relevant case authority shows that Plaintiff‘s objections are not well
taken and that itis not necessary to ptovide declarations from the expert witnesses. A
declaration of counsel is adequate to establish retention of expert witnesses and the amounts paid
to experts‘ Jones v. Dumrichob (1998) 63 Ca1.Ap.4"‘ 1258, 1264-65 (affirming an award of
expert witness fees pursuant to section 998: “We find nothing in the case law, the statute, or rule
OOOOVON
870(a)(1) ofthe California Rules of Court [now rule 3. 1700] regarding prejudgment costs which
prohibits reliance on the declaration of counsel as documentation of the items claimed”) The
Jones court also found that the experts’ bills presented at the hearing were subject to a hearsay
11 exception and were admissible to prove the reasonableness of charges incurred. ld., 63
12 Ca1.App.4”‘ at 1267. Plaintiff‘s evidentiary objections are overruled.
13 In addition to the Jones case, Plaintiff in reply cites two cases to support an argument that
14 Defendants have failed in their proofof section 998 expert witness fees. (Reply Memorandum,
15 at 6: 2-9.) Bach v. County ofBuIte (1989) 215 Cal.App.3d 294, 308, does not deal with section
16 998 expert witness fees; in that case, the Court of Appeal ruled in favor of a party seeking
17 attorney fees as costs, rejecting an argument that a cost memorandum was insufficient because it
18 did not attach the attomey’s invoices. Plaintiff also cites Evers v. Cornelson (1984) 63
19 Cal.App.3d 3 10, 3 15, for the proposition that “[a] party may fail to meet its burden where the
20 evidence of costs consists of a conclusory declaration that contains hearsay.” (Reply
21 Memorandum, at 6: 7-8.) This proposition isnot the holding ovaers: in the language Plaintiff
22 references, the Court 0f Appeal isdescribing the appellant’s argument that was waived by not
23 being made in the trial court.
24 b. Preoffer costs
25 Plaintiff argues, and Defendants do not dispute, that $1, 478.40 of the costs associated
26 with Mr. Hazel’s work were incurred prior to the date ofthe offer. Defendants claim that
27 Regency Outdoor Advertising, Inc. v.City ofLos Angeles (2006) 39 Ca|.4‘h 507, 532,
28 “specifically rejected the arguments that experts costs recoverable under section 998 are limited
to postoffer expert costs.” (Defendants’ Memorandum in Opposition, at 9:6-7.) However,
Regency has been superseded by the 20] 6 amendment to section 998, and the court’s discretion
is limited to postoffer costs. See Taste v. Calportland Construction (2016) 245 Cal.App.4"‘ 362,
375-76. Therefore, $1, 478.40 isproperly taxed.
\OOONQUIbWN—‘
c. Mr. Golthardt’sfees
As to the postoffer costs, Plaintiff argues that Defendants’ claim for witness fees is
“statutorily disallowed” to the extent that the fees relate to services provided by “people who
were neither experts nor witnesses.” (Plaintiff‘s Memorandum in Support, at 4: 4, 5—6.)
Specifically, Plaintiffclaims that $1 1,002.50 in fees associated with Mr. Gotthardt should be
taxed because Defendants cancelled his deposition “months before trial” (Reply Memorandum,
at 8:l 7); he did not prepare a report; he was not included 0n Defendants’ trial witness list;and he
did not testify at trial. Therefore, Plaintiff argues, under the rule of Goodstein Bank
v.v
ofSarz
Pedro
expert,
Support,
(I994)
he was
27
not
Cal.App.4‘h
“anticipated
at 5:6 (emphasis
899, 9| 0,
to be an
in original»,
expen
and he
m
Defendants did
was
not intend
at trial”
to call Mr.
(Plaintiff‘s
merely a consultant whose
Gotthardt as an
Memorandum
fees may
in
not be
recovered as costs.
However, Plaintiff’s conclusion that Mr. Gotthardt was a consultant who was never
|
intended to testify at trial ignores what actually happened and inappropriately focuses on trial
instead of reasonable
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pretrial preparation. The decision t0 incur pretrial costs “must be viewed
|
OONQMADJN—OOOONQMAWN—O
from the pretrial vantage point." Brake v. Beech Aircraft Corp. (1986) 184 Ca].App.3d 930, 940.
Mr. Gotthardt was listed on Defendants’ Expert Witness Disclosure (April 3 Declaration, Exhibit
E), which specifically referenced his expected testimony concerning “plaintiff‘s participation in
public-private partnerships and other governmental contracting.” (ld., 4:8-9.) Plaintiff‘s case
emphasized his experience with governmental contracting, so itwas reasonable and prudent for
Defendants t0 anticipate a need t0 present expert testimony to address this expected aspect of
Plaintiff’s damage theory. At some point, Plaintiffknew--but Defendants did not--that the
calculations of Plaintiff‘s lead damage expert, Susan Heinemann, would not include revenue
projections involving public-private partnerships. When Defendants took Ms. Heinemann’s
deposition on August 20, 201 8, they learned that she would not offer any such projections based
on Plaintiff‘s work in public-private partnerships That same week, on August 24, 201 8,
Defendants promptly notified Plaintiff that Mr. Gotthardt would not be testifying. This all
happened two weeks before the date then set for trial: September 10, 20] 8. Plaintiff does not
dispute this chronology.
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The record shows that Defendants fully intended t0 call Mr. Gotthardt as an expert
witness until they learned that Plaintiff had decided not to pursue a reasonably anticipated aspect
ofdamages. Plaintiff provides no authority suggesting that, under such circumstances, the court
lacks discretion to award fees associated with Mr. Gotthardt’s services. In fact, the bright-line
rule Plaintiff urges that costs should not be allowed for an expert who did not testify at trial,was
rejected in a case cited by Plaintiff: Evers, supra, 163_ Cal.App.3d at 3 1 7 (affirming award 0f
expert witness fees for doctor who was “potentially an expert witness whose services were
obtained in preparation for trial”).
d. Mr. Hazel ’s staff
Next Plaintiffchallenges $77,443 in fees associated with the work of five individuals
who assisted Mr. Hazel in his research and preparation. Plaintiff argues that these individuals
were not disclosed
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as experts and that there isno showing that fees for their time are reasonable.
However, section 998 “does not specify precisely the services for which costs are recoverable,
mflamwa—‘OWOOVQLJIAUJNfl
[and so] the determination of allowable costs islargely within the trial court's discretion.” Evers,
supra, 163 Cal.App.3d at 317-18. In fact, the law is well settled that fees for skilled
professionals who assist testifying experts to prepare their testimony are allowable as expert
witness fees. E.g., Sanantonio v. Westinghouse Broadcasting C0. (I994) 25 Cal.App.4"‘ 102,
123—24. Furthermore, the Lanphere Declarations and the invoices provide a detailed explanation
of the tasks performed by staff and establish that the work was performed at reasonable (and
substantially lower) hourly rates. (February 22 Declaration, at paragraph 13; April 3
Declaration, at Exhibit G.) Plaintiffprovides no evidence that the rates are not reasonable.
Therefore, Plaintiff’s motion as to expert witness fees is granted in the amount of
$1, 478.40 and is otherwise denied.
2. Court Reporter Fees
Defendants seek to recover $12,085 paid to two court reporters who reported the trial
proceedings pursuant to a stipulation and order appointing them official pro tempore court
wa reporters. Court reporter fees are expressly authorized by Code of Civil Procedure section
1033.5(a)(1 1) and Government Code section 68086.
Plaintiff incorrectly argues that “Defendants have not presented evidence to support their
claimed
OOOONQU‘
costs.” (Reply Memorandum, at 7225-26.). 1n addition to the verified Memorandum 0f
Costs, Defendants submitted invoices. (February Declaration, at paragraph 14 and Exhibit H.)
Plaintiff also incorrectly argues that transcript fees (which are not recoverable) and court reporter
per diem fees (which are recoverable) “‘cannot be distinguished.” (Reply Memorandum, at 7:20.)
11 The invoices clearly break down the totals as between these two categories. At the hearing,
12 Plaintiff argued that the court should disallow even the court reponer per diem fees despite the
13 statute which expressly allows recovery, but offered no authority for this result.
l4 The motion is granted as to the transcript costs in the amount of $6,685 and denied as to
15 the per diem fees in the amount of $5,400.
l6 3. Deposition Costs
17 Although deposition costs, including video recording, are expressly allowed pursuant to
18 Code of Civil Procedure section 1033.5(a)(3)(A) and therefore the prima facie showing must be
19 rebutted, Plaintiff provides no evidence to support his challenge to this item.
20 a. Burden ofproofas Io reasonableness
21 Plaintiff asserts that that Defendants bear the burden of proof as to all cost items (Reply
22 Memorandum, at 5: 2), and characterizes Defendants’ argument as “misconstru[ing]” the burden
23 ofproof. (1d,, at 5: 3.) However, the law is well settled that where items listed 0n a verified
24 memorandum of costs are expressly allowed by statute, the memorandum is prima facie evidence
25 ofthe propriety of those costs, and the burden ison the objecting party to present evidence, not
26 just argument, that the claimed costs were unnecessary or unreasonable. E.g., Ladas v.
27 ’n 19 Ca1.App.4”‘ "Defendant's mere
California State Auto. Ass (1993) 761 ,
774. statements in
28 the points and authorities accompanying its notice of motion to strike cost bill and the
declaration of its counsel are insufficient to rebut the prima facie showing.” Rappenecker v.Sea-
Land Services, Inc. (1979) 93 Cal.App.3d 256, 266 (affirming orders denying motions to strike
cost bills).
In support of his argument, Plaintiffcites a case that holds exactly the opposite, and then
edits the case language to support his conclusion. Plaintiff relies on Nelson v. Anderson (1999)
OOOONGMAL’JNfl
72 Cal.App.4‘“ l ll, for his proposition that “a motion to tax costs is a proper objection.” (Reply
Memorandum, at 5: 18-19.) In Nelson, the party seeking to tax costs unsuccessfully made
exactly the same argument that Plaintiff makes here: “that the mere filing of [a] motion to tax
costs shifted the burden to [the party seeking to recover costs] to prove the necessity and
reasonableness of the costs.” Nelson, supra, 72 Cal.App.4"‘ at 131. Rejecting that argument, the
Court of Appeal held that the party challenging an expressly allowed cost has the burden and that
the trial court had erred in requiring the party seeking costs to provide additional evidence. The
Court stated that if the items challenged are expressly allowed by statute and appear proper on
their face, “the burden is 0n the objecting party to show them to be unnecessary or
unreasonable.” (1d.)
Specifically, Plaintiff’s assertion that “a motion to tax costs is a proper objection” (Reply
Memorandum, at 5: 18-1 9) is neither the holding nor the language ofNelson. The decision
actually states: “We agree the mere filing of a motion to tax costs may be a ‘proper objection’ to
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an item, the necessity of which appears doubtful, or which does not appear to be proper on its
OOVQMAWN—‘OKOOOVO‘MAWN—
face.” (Nelson, supra, 72 Cal.App.3d at 13 I.) 1n his brief, P1aintiff(1) changes “may be” to
“is”; (2) omits the quotes around “proper objection” which signify that it has a particular
meaning: i.e.,supported by evidence; and (3) ignores the rest ofthe sentence which qualifies the
meaning to apply only when the dubiousness or impropriety ofthe costs is apparent on the face
of the cost memorandum. Then (4) Plaintifi‘overlooks entirely the very next sentence:
“However, ‘[i]fthe items appear to be proper charges the verified memorandum is prima facie
evidence that the costs, expenses and services therein listed were necessaxily incurred by the
defendant [citations], and the burden of showing that an item isnot properly chargeable or is
.— unreasonable is upon the [objecting party].’” (Id) Finally, (5) Plaintiffignores the holding,
adverse to his exact argument.
Plaintiff also aIgues that his position that “[a] motion to tax costs rebuts aprimafacie
showing in a memorandum ofcosts” is supported by Melnyk v. Robledo (1976) 64 Cal.App.3d
61 8, 624. (Reply Memorandum, at 5:7-9.) Melnyk does not hold that a motion to tax costs,
when
OOmNQM¢MN not supported by evidence, nevertheless is sufficient to rebut the prima facie showing as to
costs expressly allowed by statute. In Melnyk, a defendant entitled to attorney fees as costs
pursuant to Civil Code section 171 7 appealed because the trial court awarded less than the
amount sought. The plaintiff filed a motion to tax costs, supported by arguments that amounts
claimed were unnecessary but not by any evidence. The defendant argued on appeal that
“plaintiff failed to make proper objection or to present any testimony that [the award] was
incorrect.” Melnyk, supra, 64 Cal.App.3d at 623. The defendant’s contention that the prima
facie showing was not rebutted because the plaintiff’s motion presented no evidence was
incorrect, the Court of Appeal explained, because where attorney fees are involved, actual
evidence of the work performed was before the trialcourt at the trial. Since attorney fees are not
at stake in this case, the Melnyk holding does not apply here.
Also in support of the suggestion that proof is not needed to rebut the prima facie
showing, Plaintiff relies on the
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nineteenth-century case of Miller v.Highland Ditch C0. (l 891)
91 Cal. 103, 105-6. (Reply Memorandum, at 5: 11-13.) However, Miller is completely
consistent with the law as framed by Defendants, and in fact acknowledges as “undoubtedly the
OOVOxmAbJN—OKOWNQM&MN—
correct rule” that a verified memorandum of costs “unless eontroverted, should control the
decision ofthe court.” (Miller, supra, 9| Cal.3d at 105.) The quote selected by Plaintiff(Reply
Memorandum, at 5: 11-12) and presented as ifit were the general rule, is taken out of context: it
refers to the facts in Miller, not present with respect to Defendants’ deposition costs, “where the
charges do not appear 0n their face to be proper and necessary.” (Miller, supra, 91 Cal.3d at
106.)
Plaintiff‘s briefing also mischaracterizes and misquotes other cases to suggest that an
objection to a cost memorandum unsupported by evidence——as opposed to a “proper” objection—
rebuts a prima facie showing. [n citing Wagner Farms, Inc. v.Modesto Irr. Dist. (2006) 145
Cal.App.4”‘ 765, 774, Plaintiff describes the holding: “[w]here costs are objected to, they are put
at issue, and the burden of proofis on the party claiming them.” (Reply Memorandum, at 5:9.)
Plaintiff omits the key word “proper”: the actual language from Wagner is “where the items are
properly objected
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to, they are put in issue, and the burden of proof is upon the party claiming
them as costs.” (Wagner, supra, 145 Cal.App.4”‘ at 774 (emphasis added).) Wagner is
completely consistent with Nelson and Rappenecker: to properly object to a verified cost bill
claiming expressly allowable costs, a party must rebut the prima facie showing with evidence.
Similarly, in purporting to quote from Jones, supra, 63 Cal.App.4‘h 1258, 1265, Plaintiff again
omits the word “properly” t0 suggest a contrary rule. (Reply Memorandum, at 5:23-25.)
Finally, Plaintiff sets up a straw man to knock itdown by incorrectly claiming that
Defendants have asserted a case holding and then arguing that the case does not so hold.
Defendants did not cite County ofKern v. Ginn (1983) 146 Cal.App.3d 1107, 1113—14, for the
attributed proposition that “a motion to tax costs is insufficient t0 challenge costs.” (Reply
Memorandum, at 5:19-23.) See Defendants’ Opposition Brief, at 5:5-10. In County ofKern, the
Court of Appeal held that the trialcourt had improperly taxed an expressly allowed cost (in that
case, deposition costs) when the party moving to tax had submitted no evidence and failed to
meet her burden.
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The trial court was reversed for doingjust what Plaintiff urges here.
’
b. Reasonableness ofDefendants deposition costs
®fl¢m¢w-o©mflamth~o
Having presented no evidence concerning whether Defendants’ deposition costs were
reasonably necessary, Plaintiff argues that Defendants are not entitled to recover $5,724.80 in
fees for depositions of three of Plaintiff’s experts because those depositions were not used at trial
and because Defendants were not “required to videotape” the depositions. (Reply Memorandum,
at 10:1 1-13.) Though he was listed as a trial witness, Plaintiffdecided not to call Kent
Hillhouse. Because Defendants prevailed in the first phase of a bifurcated trial, damages experts
Ms. Heinemann and Williams Fellers were not called.
The first of the two cases on which Plaintiff relies, Perko ’s
Enterprises, Inc. v.RRNS
Enterprises (1992) 4 Ca1.App.4”‘ 238, 245, does not involve a deposition not used at trial, but
10
instead deals with a filing fee incurred after the court had already ruled on the issue which was
addressed by the filed papers. The other case Plaintiff cites, Serrano v.Stefan Merli Plastering
C0. (2008) 162 Ca.App.4”‘ 1014, does not involve recovery ofcosts following trial at all.
1t simply does not follow thatjust because the depositions were not used at trial,the
deposition costs were
OOOONONUIAL'JN-d not reasonably incurred, and the law is well settled on this issue. A case
cited by Plaintiff for another point contradicts Plaintiff’s argument on deposition costs: Seever v.
Copley Press, Inc. (2006) 141 Ca1.App.4”‘ 1550, 1557 (even though videotaped depositions were
not used at trial,costs incurred were not unnecessary or unreasonable). 1n Brake v. Beech
Aircraft Corporation (1986) 184 Cal.App.3d 930, 940, following an adversejury verdict, the
plaintiffs challenged defendant’s costs of taking plaintiffs’ experts’ deposition as not reasonably
necessary on the ground that ultimately, at trial, the expens’ testimony was not disputed. 1n
rejecting that argument, the Court oprpeal observed: “The need for a deposition must be
viewed from the pretrial vantage point of a litigant who does not yet know whether or not to
oppose the expert's opinions. (Moss v. Underwriters’ Report, Inc. (1938) 12 Ca1.2d 266, 275-76
[affirming denial of motion to tax costs as t0 deposition not used at trial].) Plaintiffs do not
explain why Beech should have been required to await surprise at trial—their apparent position on
appeal. 1twas their burden to show that the depositions were unnecessary.” The reasonableness
of a deposition cost should be evaluated as of the time the cost was incurred and not based on
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whether the witness’s testimony was useful at trial. (Nelson, supra, 72 Cal.App.4‘h at 132
WNQMANN—OOWNQMADJN—
(reversing disallowance 0f deposition costs where objecting party did not prove expense
unreasonable at the time incurred).)
Given the complexity and high stakes ofPlaintiff’s claims, as explained in the Lanphere
Declarations and not contradicted by Plaintiff, itwas reasonably necessary to take and to
videorecord these expert depositions. The motion as to such costs is denied.
4. Messenger Fees
Defendants seek recovery of $3,857.55 for twenty-eight specified items. Messenger fees,
not expressly allowed or disallowed, may be awarded as costs when “reasonably necessary to the
conduct of the litigation rather than merely convenient or beneficial to itspreparation.” Code of
11
Civil Procedure section 1033.5(c)(2). In addition to the verified Memorandum of Costs,
Defendants have submitted evidence that the messenger fees claimed “relate to documents filed
with the Court or served on Plaintiff or third party witnesses.” (April 3 Declaration, at 4: 18-20.)
th In his motion, Plaintiff presents no evidence to challenge any of these costs, and presents
argument as to only two issues. First, as Plaintiff clarified at the hearing, he isnot arguing that it
was not reasonably necessary to personally serve a deposition subpoena. Rather, Plaintiff
contends that service of a subpoena on Jenny Su was not necessary because itwas not necessary
OOOOQQM
for Defendant to take Ms. Su’s deposition at all,for the stated reasons that she was not on
Defendants’ trial witness listand that Plaintiff decided not to call her at trial. (Reply
Memorandum, at 8: 25-26.) However, Plaintifflisted Ms. Su on his trial witness list. Similarly
11‘ as t0 the second issue, Plaintiff offers no argument that messenger delivery of Defendants’
12 motion for summary judgment was not reasonably necessary, but argues instead that since
13 Defendants did not prevail on the motion, itshould never have been made at all—again,
14 inappropriately using hindsight to evaluate the reasonableness of a cost incurred in discovery and
15 trial preparation. (Seever, supra, 141 Cal.App.4‘h at 1557; Brake, supra, 184 Cal.App.3d at 940.)
16 These fees were reasonably necessary, and the motion as to such fees is denied.
17 5. Courtroom Technology Equipment
18 Costs incurred for “the electronic presentation of exhibits, including costs of rental
19 equipment and electronic formatting, may be allowed if they were reasonably helpful to aid the
20 trier O_f fact.” Code of Civil Procedure section 1033.5(a)(13). During the trial of this case, both
21 sides devoted much time and attention to showing thejury many documents and to conducting
22 examinations and making arguments about specific language in the doguments. There can be no
23 doubt that the electronic presentation of exhibits, which allowed the jury to see the language at
24 issue while the witness was questioned and during argument, was enormously helpful to them.
25 Plaintiff does not contend otherwise. Plaintiff challenges this cost solely on the basis that
26 on an unspecified date and on unspecified terms, Plaintiff offered t0 share technology during trial
27 and Defendants declined. (Atkinson Declaration, at 2: 13-14.) Given the substantial and
28 undisputed importance of the electronic presentation, itwas reasonable for Defendants to ensure,
12
that they had_electronic equipment that worked exactly the way they intended, and the vague
information about Plaintiff’s offer does not show that the costs incurred were not reasonably
necessary. The motion as to these costs is denied.
6. Reasonableness of the Total Amount of Claimed Costs
©WVO\U1$UJNt—t
Plaintiff argues that Defendants’ $228,005.56 claim for costs is unreasonable because it is
more than twice the amount of Defendants’ Offer t0 Compromise. (Plaintifi‘s Memorandum in
Support, at 4: 13-15.) Plaintiffprovides no authority that the amount ofa sectioh 998 offer
should be a measure 0f the reasonableness of costs incurred in defense of litigation. Item by
item, the costs sought are reasonable in amount, and the total amount isnot inappropriate in a
case in which Plaintiff, had he established liability, intended to seek a verdict in eight figures.
Second, Plaintiff argues that the court should exercise its discretion to tax Defendants’
expett witness fees because of Defendants’ “intent to ‘penalize’” Plaintiff. (Reply
Memorandum, at 8:12.) Plaintiff accuses Defendants of this improper intent based on
Defendants’ citation to Evers, supra, 163 Cal.App.3d at 31 7, in which the Court oprpeal
observed, and Defendants quoted, that itis the statute’s “intent t0 penalize”: “Section 998 seeks
to penalize a litigant who, in refusing a reasonable settlement offer, causes the other party to
suffer the expenses (ifexpert witnesses reasonably necessary in either, or both, the preparation or
trialof the case.”
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This case
OONaU‘IfiwNHOOWNQKII-hUJNHO
does not involve the same concerns as in Seevers, supra, 141 Cal.App.4”‘ at
1561-62, where the Court of Appeal noted that, in employment cases, “it is entirely appropriate
and indeed necessary for trial courts t0 ‘scale’ those awards downward to a figure that will not
unduly pressure modest- 0r low-income plaintiffs into accepting unreasonable offers.” Plaintiff
the.
offered no evidence in opposing motion that he should be treated as if he were a “modest- 0r
Iow-income plaintif .” According to the trial documentation Plaintiff proposed to use in a
damages phase, Plaintiff earned multiple millions of dollars for several years. (April 3
Declaration, at Exhibit F.) Accordingly, this is a case in which the articulated objective of
section 998 is furthered by an award of costs such as Defendants seek, and it isnot necessary or
appropriate for the court to exercise its discretion to tax costs which Defendants actually and
13
reasonably incurred on account of Plaintiff’s decision not t0 respond to the Offer to
Compromise.
Defendants’ claimed costs are taxed in in the amount of$8,163.40, and Plaintiff’s motion
isotherwise denied. Accordingly, Defendants will recover costs in the total amount of
$219,842.16.
OOWNmeL’JN—
Dated: April 16, 2019
EWJA
Honorable
Judge of the
all,
Patricia M.
WLucas
Superior Court
‘
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14
IN THE SUPERIOR COURT OF THE STATE OF CALIFORNIA
IN AND FOR THE COUNTY OF SANTA CLARA
MichaelHanneken,
vs.
Plaintiff F I
APR
L