Anaheim Sexual Harassment Attorneys: Hansen v. Moore

Appellant Kimberly A. Hansen appeals the trial court's decision granting summary judgment in her sexual harassment claim against respondent Scott Moore. She argues triable issues of fact should have precluded summary judgment, that the trial court abused its discretion by refusing to grant a continuance, gender bias by the trial court, and finally, that the trial court abused [*2] its discretion by granting prevailing party attorney fees to Moore. We disagree with Hansen's arguments and affirm the judgment in Moore's favor. Moore appeals the attorney fee award only, arguing the trial court arbitrarily reduced the amount of attorney fees. We agree the record reflects the award was arbitrarily reduced, and therefore reverse the order granting attorney fees with directions to recalculate the attorney fee award.

I

FACTS

Hansen, an attorney, worked in the legal department at Insco Insurance Services (Insco) from 1993 until her termination in 1997. Moore was a paralegal at Insco and an office manager in the legal department. Hansen's immediate supervisor, according to her own testimony, was Lawrence Kepiro, an Insco senior vice-president and an attorney. Hansen assigned litigation projects to Moore, including propounding discovery and preparing discovery responses.

On January 16, 1997, Hansen was notified her position was being eliminated for economic reasons effective February 15, 1997. The first time Hansen notified Insco's human resources officer that she had been sexually harassed was after she was notified of her termination.

Hansen (and coplaintiff [*3] James Lavin, not a party to this appeal) filed a complaint against Insco and Moore in September 1997. Against Insco, Hansen alleged sex discrimination and sexual harassment, and retaliation in violation of the Fair Employment and Housing Act (FEHA) (Gov. Code, § 12940 et seq.), unlawful wage discrimination based on sex in violation of the Labor Code, and breach of an implied covenant of continued employment. Hansen's only claim against Moore was sexual harassment in violation of FEHA.

Discovery proceeded, and in June 1998, Insco filed a motion for summary judgment against Hansen. While the motion was pending, Division Two of this court decided Carrisales v. Department of Corrections (1998) 65 Cal.App.4th 1492, holding that a non-supervisory coworker could not be held liable for sexual harassment under FEHA. Moore thereafter filed his own motion for summary judgment. After denying Hansen's request for a continuance, the court granted Moore's motion and denied Insco's motion. Thereafter, Moore requested a $ 59,500 attorney fee award, and the court awarded him $ 25,000.

Hansen filed this appeal, and in the interim, her case against Insco proceeded to trial. The jury's [*4] verdict was in Insco's favor. The jury found that Hansen did not prove she was sexually harassed by Moore. Thereafter, the California Supreme Court affirmed the Court of Appeal's decision in Carrisales. ( Carrisales v. Department of Corrections (1999) 21 Cal.4th 1132, 988 P.2d 1083.) Hansen and Lavin appealed the verdict in Insco's favor, and the judgment was affirmed except with respect to Insco's attorney fee award. (Hansen v. Insco Insurance Services, Inc., (Mar. 27, 2002, G026038 [nonpub. opn.].)

II

DISCUSSION

Collateral Estoppel

The ultimate issue in any trial between Hansen and Moore would be whether Moore sexually harassed Hansen. A jury, however, has already determined this issue against Hansen, deciding that she did not "prove by a preponderance of the evidence that she was sexually harassed . . . by Scott Moore during her employment[.]" Thus, even if we were to find a triable issue of material fact as to whether Moore was Hansen's supervisor, would Hansen be subject to another motion for summary judgment on the grounds of collateral estoppel? If so, then any error was harmless, the judgment was clearly correct and should be [*5] affirmed. (See Paterno v. State of California (1999) 74 Cal.App.4th 68, 108.)

Five elements must be present before collateral estoppel may be applied: (1) the issue sought to be precluded from relitigation must be identical to that decided in a former proceeding; (2) the issue must have been actually litigated in the former proceeding; (3) the issue must have been necessarily decided in the former proceeding; (4) the decision in the former proceeding must be final and on the merits, and (5) the party against whom preclusion is sought must be the same as, or in privity with, the party to the former proceeding. ( Gikas v. Zolin (1993) 6 Cal.4th 841, 849, 863 P.2d 745.)

Hansen argues the first element is not met because "the elements required to establish liability on the part of Insco, her employer, were greater and vastly different from the showing necessary to establish liability on the part of an individual." But the issue sought to be precluded from litigation is whether Moore sexually harassed Hansen. It is irrelevant if the other elements needed to establish liability against Insco are "greater and vastly different." The factual issue of actual [*6] harassment is identical, and a jury found no harassment by Moore.

Similarly, Hansen makes the quite implausible argument that "the issue of Moore's sexual harassment of Hansen was not actually litigated during the trial" because "the liability for sexual harassment as to an employer is different from the issue of individual liability. . . ." Therefore, she argues, there was no final judgment on the merits of her claims against Moore. Again, Hansen fails to understand the difference between litigating the elements of a prima facie case and litigating the factual issue that ultimately controls. The factual issue is actual harassment and there is no question, based on the verdict form, that the jury considered and rejected Hansen's claim. A final judgment on the merits was therefore rendered.

Finally, Hansen argues that because Moore was not a party to the judgment or in privity with a party, he may not "take advantage of or be bound by it." But privity is only required as to the party "against whom preclusion is sought," ( Gikas v. Zolin, supra, 6 Cal.4th at p. 849) in this case, Hansen. She was a party to the prior judgment and is therefore bound by it.

In fact, [*7] this is a classic case where the application of collateral estoppel is appropriate. Hansen has already had every opportunity, and every motivation, to convince a jury that she was the victim of sexual harassment. She is not entitled to relitigate that issue. This case is similar to derivative liability cases applying collateral estoppel against the plaintiff after one defendant was found not negligent: "It would be unjust to permit one who has had his day in court to reopen identical issues by merely switching adversaries." ( Bernhard v. Bank of America (1942) 19 Cal.2d 807, 813, 122 P.2d 892.)

Hansen is not helped by the argument that she did not choose to litigate her cases against Insco and Moore separately, but was left no choice because of the trial court's decision granting summary judgment to Moore. Simply put, so what? If Hansen's case against Moore had proceeded to trial along with her claim against Insco, we can think of no possible reason why the result would be different. To the contrary, Moore would have had an even greater opportunity and increased motivation to defend himself against personal liability.

There is no question that the issue of whether [*8] Moore sexually harassed Hansen has already been decided by a jury in a case reaching a judgment on the merits. Hansen was a party in that case and had her day in court. Because this would be the ultimate issue in any subsequent case between Hansen and Moore, collateral estoppel applies, and the judgment in Moore's favor was correct. This disposes of the issues surrounding the trial court's decision to grant summary judgment, including whether any triable issue of fact exists and whether the court abused its discretion by failing to grant Hansen a continuance.

Judicial Bias

Because the judgment in Moore's favor was correct, we need not discuss in detail Hansen's allegations of judicial bias. Nonetheless, we have reviewed her claims and the record and find her arguments to lack merit, just as the same arguments lack merit in her appeal against the judgment in Insco's favor. This issue is discussed in detail in our opinion in that case, Hansen v. Insco Insurance Services, Inc. (Mar. 27, 2002, G026038.)

Attorney Fee Award

Both parties appeal the attorney fees awarded to Moore. Hansen argues attorney fees should not have been awarded at all, while Moore [*9] argues the court arbitrarily reduced the attorney fee award to $ 25,000. Each of these issues are considered below. Moore also argues the court erred in requiring him to file a separate motion for attorney fees, rather than considering fees as part of a cost award. We agree, but fail to understand how Moore suffered prejudice as a result of being required to file a separate motion. Therefore, this requirement does not constitute reversible error. (See Cal. Const., Art. VI, § 13.)

An award of attorney fees under FEHA is reviewed for abuse of discretion. ( Bond v. Pulsar Video Productions (1996) 50 Cal.App.4th 918, 921.) The trial court may award a prevailing defendant attorney fees if the court determines the claim was unreasonable, frivolous, meritless or vexatious. ( Cummings v. Benco Bldg. Services (1992) 11 Cal.App.4th 1383, 1387.) Although more than a mere failure to prevail is required to justify an award of attorney fees, subjective bad faith is not required. (Ibid.)

The court found Hansen's lawsuit against Moore was groundless and frivolous. Among others, the court identified the following factors as relevant to that determination: Moore's [*10] status as a paralegal was strongly suggestive that he would not be the supervisor of lawyers, Hansen knew or should have known that her supervisor was not a paralegal to whom she assigned work, and Hansen had identified her supervisors as individuals other than Moore in her discovery responses. Those findings, which pertain to the issue of whether there was any evidence whatsoever that Moore was Hansen's supervisor, are supported by the record.

Moore's status as Hansen's coworker, rather than her supervisor, became a critical issue in this case because of the Carrisales decision, holding that non-supervisory coworkers were not liable under FEHA. Since this case was published, Hansen has been attempting to make the argument that Moore was really her supervisor, despite the evidence to the contrary. While Hansen may have had a legitimate reason for bringing her case against Moore at the outset, once the Carrisales decision was decided in August 1998, it should have been clear to a reasonable attorney that a direct claim against Moore could no longer be maintained. Yet Hansen continued to insist on the viability of her claim, even after the Supreme Court had its final say on [*11] the matter. ¹ Therefore, we find no reason to disturb the trial court's finding that Hansen's claim was groundless and without merit.

FOOTNOTES

1 At oral argument, Hansen argued for the first time that an amendment to FEHA adopted to overrule Carrisales and hold coworkers liable for sexual harassment should be applied retroactively. The provision did not become law until January 1, 2001. (Gov. Code, § 12940, subd. (j)(3).) Hansen provided no authority for this argument, and we find it to be without merit. For both substantive purposes and to decide the propriety of attorney fees, the law as it existed at the time the trial court reached its decisions is determinative.


The second issue is Moore's claim regarding the amount of attorney fees. Moore contends the court failed to properly calculate the fee award and arbitrarily reduced the amount of the award to $ 25,000. Hansen does not respond to this argument, instead using her responding brief to rehash her argument that attorney fees are inappropriate. Our review [*12] of the record supports Moore's argument. At the hearing on the motion for attorney fees, after finding that a fee award would be appropriate, the trial judge stated: "It is sort of arbitrary to decide what the amount would be, but taking everything into account, it seems like [$ ]59,000 is kind of high. So, I will make it [$ ]25,000, and that will be the award."

Unless the statute under which attorney fees are available states a different method for calculating the fee award, the trial court is required to use the lodestar method. ( Meister v. Regents of University of California (1998) 67 Cal.App.4th 437, 449.) The lodestar is determined by multiplying the time spent and reasonable hourly compensation of each attorney. ( Serrano v. Priest (1977) 20 Cal.3d 25, 48, 49, 141 Cal. Rptr. 315, 569 P.2d 1303.) The trial court then has discretion to adjust the amount upward or downward, based on factors such as the novelty or difficulty of the issues involved, and the extent to which the nature of the litigation precluded other employment by the attorneys. Although it is certainly possible the court had specific reasons in mind for reducing the award along [*13] the lines endorsed in Serrano, we cannot say that is reflected by the record.

We therefore reverse the fee award and remand with directions to the trial court to recalculate attorney fees, first using the lodestar method, and then adjusting the amount upward or downward using the factors set forth in Serrano. Ultimately, the court may certainly reach the same result, as long as the award is analyzed under the Serrano criteria, but it must nevertheless go through the process and reach a conclusion through a reasoned analysis.

III

DISPOSITION

The order granting summary judgment in Moore's favor is affirmed.

The order granting Moore $ 25,000 in attorney fees is reversed and remanded with directions to calculate attorney fees in a manner consistent with the legal principles discussed in this opinion. Moore is also entitled to costs on appeal.

MOORE, J.

WE CONCUR:

O'LEARY, ACTING P.J.

FYBEL, J.