THE LAB, LLC vs. STRATHMORE CUSTOM HOMES, INC

Code of Civil Procedure section 998 serves “ ‘to encourage the settlement of lawsuits prior to trial.’ [Citation.]” (Westamerica Bank v. MBG Industries, Inc. (2007) 158 Cal.App.4th 109, 129, 70 Cal.Rptr.3d 125.) It does so “by ‘establish[ing] a procedure for shifting the costs upon a party’s refusal to settle.’ [Citation.]” (Finlan v. Chase (2021) 68 Cal.App.5th 934, 940, 283 Cal.Rptr.3d 915.) Section 998, subdivision (c)(1) provides that “[i]f If an offer made by a defendant is not accepted and the plaintiff fails to obtain a more favorable judgment or award, the plaintiff shall not recover their postoffer costs and shall pay the defendant’s costs from the time of the offer.

In addition, in any action or proceeding other than an eminent domain action, the court or arbitrator, in its discretion, may require the plaintiff to pay a reasonable sum to cover postoffer costs of the services of expert witnesses, who are

not regular employees of any party, actually incurred and reasonably necessary in either, or both, preparation for trial or arbitration, or during trial or arbitration, of the case by the defendant.”

On October 11, 2021, Defendant’s counsel served two Code of Civil Procedure section 998 offers (“Section 998 Offers”) on Plaintiffs’ counsel. (Fairchild Decl. ¶ 3, Exhs. A and B [ROA 464].) Through Defendant’s Section 998 Offers, Defendant offered each Plaintiff to have judgment entered against Defendant in favor of Plaintiff in the amount of $25,000.00 in full settlement of all of Plaintiff’s claims raised in the complaint against Defendant. (Id.) Each party would bear their own costs. (Id.) Defendant received no response from either Plaintiff. (Fairchild Decl. ¶ 3.) Because Plaintiffs did not accept the Section 998 Offers, Defendant was not required to file the offers. (See Code Civ. Proc., § 998, subd. (b).) It is undisputed that Defendant is the prevailing party under the Judgment. It is also undisputed that Defendant sent valid Section 998 Offers to Plaintiffs.

In his initial expert designation, Defendant identified only Guy C. Alexander III as a non-retained expert and reserved the right to supplement the designation. (Fairchild Decl. ¶4, Exh. C.) Defendant received Plaintiffs’ initial expert designation on April 7, 2025, in which Plaintiffs likewise designated Alexander as a non-retained expert and also identified three retained experts: Corbet Lancaster, C.P.A., C.V.A., Matthew J. Salcedo, Esq., and Reeza Gervacio. (Id. at ¶ 5, Exh. D.) Defendant’s counsel concluded that the breadth of Plaintiffs’ experts’ opinions required qualified expert rebuttal. (Id. at ¶¶ 6-7.)

Defendant retained Lawrence H. Jacobson to address and rebut Plaintiffs’ experts’ valuation opinions and their asserted real estate “standard of care” theories, and John E. Alstadt as Defendant’s damages expert to evaluate, rebut, and respond to Plaintiffs’ experts’ opinions. (Id. at ¶¶ 7-8.) Jacobson and Alstadt were identified in Defendant’s supplemental expert designation, served on April 28, 2025, and were retained after Plaintiffs rejected Defendant’s Section 998 Offers. (Id. at ¶¶8-9.)

In its discretion, the Court rules that Plaintiffs shall pay Defendant’s reasonable postoffer expert witness costs.

Duplicative Costs

Plaintiffs assert that Items No. 30 and 31 relate to Jacobson’s deposition and are duplicative of fees that were already paid. Item No. 30, however, clearly relates to Lancaster, not Jacobson. Furthermore, as Item 31’s note provides and as pointed out by Defendant in Opposition, Plaintiffs’ counsel paid $975 of original $1,300; thus, the difference of $325 was sought. Plaintiffs have failed to show any duplication. This request to strike is denied.

Plaintiffs assert that Item Nos. 25 & 26 and Item Nos. 56 & 58 are excessive, duplicative, and unreasonable and should therefore be stricken. “If items on their face appear to be proper charges, the verified memorandum of costs is prima facie evidence of their propriety, and the burden is on the party seeking to tax costs to show they were not reasonable or necessary.” (Jones v. Dumrichob (1998) 63 Cal. App.4th 1258, 1266.) Once the opposing party makes such a showing the challenged items are put in issue and the burden shifts back to the party claiming them as costs. (Ibid.)

But conclusory assertions alone are not enough to cause this shift to happen. “[I]t is not enough for the losing party to attack submitted costs by arguing that he thinks the costs were not necessary or reasonable. Rather, the losing party has the burden to present evidence and prove that the claimed costs are not recoverable.” (Seever v. Copley Press, Inc. (2006) 141 Cal.App.4th 1550, 1557.)

Here, Plaintiffs do nothing more than state these costs were duplicative and unreasonable. In any event, these Items show services performed on four different dates and Defendant presents evidence that Alexander (Plaintiffs’ non-retained expert) was difficult to serve, requiring multiple attempts. Furthermore, costs incurred to effect service, including, stakeout costs are permitted under Code of Civ. Proc. § 1033.5(a)(4)(B), unless successfully challenged. Plaintiffs have failed to meet their burden, and the motion is denied as to these fees.

Photocopying Costs

Plaintiffs next challenge Item Nos. 19 ($131.50) & 67 ($220.50) for what they contend are photocopying charges, which are not recoverable under Code of Civil Procedure section 1033.5(b). Defendant submits those items are better understood as subpoena, records, and deposition-officer charges incurred to obtain records for this case, not ordinary photocopying. The fees are permitted as being reasonably necessary to the conduct of the litigation and the motion is denied as to these fees.

Binder Delivery Costs

Plaintiff challenges Item No. 38 for Binder Delivery and argues that it is not a cost necessarily incurred to the conduct of litigation. The $44.96 delivery charge was incurred for the delivery of trial binders to the Court. Trial binders were required by the court’s trial procedures and were part of the parties’ trial preparation and presentation. The motion to strike or tax these fees is denied.

Altstadt Expert Costs

Plaintiff challenges Betty Altstadt’s time billed ($750) and requests a 75 percent reduction in the $14,155 fee incurred. (Item Nos. 22 & 50.) In Opposition, Defendant contends he hired Altstadt Consulting, Inc. and the firm is run by John and Betty Altstadt, both of whom have accounting expertise. Technically, Defendant retained John Altstadt as an expert, not Altstadt Consulting, Inc. pursuant to the supplemental expert designation attached to Fairchild’s Declaration as Ex. E. Nevertheless, Plaintiffs fail to show that the work performed by Betty Altstadt was unreasonable or unnecessary. Furthermore, the cost is allowed under Code of Civ. Proc. § 1033.5(c)(4) “Items not mentioned in this section and items assessed upon application may be allowed or denied in the court’s discretion.”

With regard to John Altstadt’s fees, as noted by Defendant, Plaintiffs’ attack on Altstadt Consulting is not evidence-based, is speculative, and arbitrarily seeks a 75% reduction of his fees. Plaintiffs do not challenge John Alstadt’s hourly rate nor is there evidence that his time or rates were unreasonable. Moreover, the fact that John Alstadt did not testify at trial is not grounds to reduce or exclude his fees. John Alstadt’s services were reasonably necessary to the conduct of litigation. The Code of Civil Procedure does not limit the recovery of expert fees to only those who testified at trial. (See, Code of Civ. Proc. §§ 998, 1032, 1033 & 1033.5.) Plaintiffs’ request to strike these fees is denied.

Jacobson Expert Costs

Plaintiffs also challenge Jacobson’s fee of $16,418.85 (Item No. 49). Plaintiffs assert his time entries are duplicative and repetitive for the same tasks, including, “review file,” “Legal analysis re: opinions,” “prepare for deposition.” Plaintiffs argue that 10.3 hrs spent preparing for a 2 hour deposition was excessive. Similar duplicative billing occurs for “review Gervacio file document production” (1.7 hours); “monitor[deposition of Reeza Gervacio” (3.6 hours); and again “review Reeza Gervacio deposition” (2.9 hours).

Moreover, Defendant seeks $1,100 in costs for Jacobson’s May 28, 2025 deposition, which are also separately listed in Item Nos. 30 & 31. Jacobson’s invoice for Reprographics” and “Photocopy Charges” in the total amount of $ 90.29 is also unrecoverable, as addressed under “Duplicative Costs”. As such, Item No. 49 should be reduced to $10,372.31. Thus, Plaintiffs conclude that Mr. Jacobson’s fees should also be reduced by 75%.

Defendant contends that Plaintiffs pointing to repeated descriptions such as ’review file,’ ’legal analysis,’ and ’prepare for deposition,’ do not prove duplicative work, only repeated work descriptions. Expert review occurred over multiple days, in response to multiple expert files, depositions, and moving targets in expert discovery.

Again, Plaintiffs submit no competent declaration explaining what time was unnecessary, no expert testimony that the hours were unreasonable, and no rate challenge. Their requested 75 percent cut is, again, arbitrary. Based on the record before the court, the court cannot say that the work performed by Jacobson was unreasonable or unnecessary. The motion is denied as to these fees.

Based on this analysis, Defendant is entitled to costs in the sum of $94,614.29 which reflects a reduction of $20,616.85 conceded by Defendant in the Opposition.

Defendant to give notice.

58 Blue Bridge Financial, Inc. vs. Bare Bunny, LLC

24-01371055 Motion for Attorney Fees

The Motion for Attorneys’ Fees brought by Plaintiff Blue Bridge Financial, Inc. (fka Blue Bridge Financial, LLC) is GRANTED, in part.

The Judgment entered on April 28, 2025, as to Defendant Bare Bunny, LLC, shall be amended to include costs in the amount of $2,175.00 and reasonable attorneys’ fees in the amount of $15,582.00.

On March 14, 2025, the Court granted summary adjudication in favor of Plaintiff, finding Defendant Bare Bunny, LLC breached an Equipment Finance Agreement. (ROA No. 111.) On April 28, 2025, judgment was entered in favor of Plaintiff and against Defendant Bare Bunny, LLC, consistent with the above. (ROA No. 123.) Per the Equipment Financing Agreement, “Borrower promises to pay all reasonable costs and expenses, including, without limitation, reasonable attorneys’ fees, collection costs plus additional expenses, incurred by Lender in the enforcement of this Agreement.” (¶8 of Scott Declaration and Exhibit 1 thereto, at §9 [ROA No. 161].)

As the attorneys’ fees incurred within this collection action qualify as fees sought “in the enforcement of this Agreement,” Plaintiff is entitled to recover its reasonable fees incurred herein. (See Code Civ. Proc., § 1033.5, subd. (a)(10)(A) and Civ. Code, § 1717, subd. (a); See also Dewberry & Davis, Inc. v. C3NS, Inc. (2012) 284 Va. 485, 495.)

Following a careful review of the billing submitted with this motion, the Court determines the reasonable amount of fees incurred herein is $15,582.00.

Of note, Defendant Rebecca Elizabeth Pate-Piercy obtained a Chapter 7 bankruptcy discharge on December 15, 2025. (¶2 of Scott Declaration and Exhibit 1 thereto [ROA No. 186].) It is undisputed that Plaintiff’s judgment against Defendant Rebecca Elizabeth Pate was included within the discharge order, such that “additional fees should not be imposed against her...” (Supplemental Brief: 2:19-20 [ROA No. 184].)

Consequently, the above order is limited to Defendant Bare Bunny, LLC.

59 Emtiaz vs. BMW of North America, LLC

25-01469682 Motion for Judgment on the Pleadings

Defendants BMW of North America, LLC (“BMW NA”) and Sterling Motors, Ltd. d/b/a Sterling BMW (“Sterling BMW”) motion for judgment on the pleadings is DENIED as to the first cause of action and GRANTED as to the second and third causes of action. Defendants’ unopposed request for judicial notice is granted.

Should Plaintiffs wish to file an amended complaint that addresses the second cause of action as discussed in this ruling, Plaintiffs must file and serve it within 15 days of service of notice of ruling. Leave to amend the third cause of action is denied.

A defendant may move for judgment on the pleadings where the court has no jurisdiction of the subject of the cause of action alleged in the complaint or the complaint does not state facts sufficient to constitute a cause of action against that defendant. (Code Civ. Proc, § 438 subd. (c)(1)(B).) A non-statutory motion for judgment on the pleadings may be made any time before or during trial. (Stoops v. Abbassi (2002) 100 Cal.App.4th 644, 650.) “Such motion may be made on the same ground as those supporting a general demurrer, i.e., that the pleading at issue fails to state facts sufficient to constitute a legally cognizable claim or defense.” (Id.)

The standard for ruling on a motion for judgment on the pleadings is essentially the same as that applicable to a general demurrer, that is, under the state of the pleadings, together with matters that may be judicially noticed, it appears that a party is entitled to judgment as a matter of law. (Bezirdjian v. O’Reilly (2010) 183 Cal.App.4th 316, 321- 322, citing Schabarum v. California Legislature (1998) 60 Cal.App.4th 1205, 1216.)