Plaintiff Ordered to Pay Employer's Attorneys' Fees in FEHA Case
A Plaintiff alleging racial discrimination and retaliation against his employer was ordered to pay the employer's attorneys' fees after the employer obtained summary judgment on all of Plaintiff's claims. In Villanueva v. City of Colton, 160 Cal.App.4th 1188 (2008), Plaintiff was employed by the City of Colton in its wastewater division. After being demoted to a lesser paying position following a reduction in force, the Court found that Plaintiff's demotion was due to legitimate non-discriminatory reasons, including Plaintiff's prior incident of mishandling an alarm incident and his lack of seniority based on continuous service. The employer filed a motion for summary judgment and the essence of its position was that, in light of the negligent manner in which Plaintiff had handled the prior alarm incident, and the elimination of Plaintiff's position being due to the City's budget shortfall and resulting reduction in force, it had legitimate non-discriminatory reasons to defeat Plaintiff's claim of pretext for the demotion. While Plaintiff attempted to introduce evidence of allegedly racial remarks by various individuals at the City, all of this evidence was properly excluded for various reasons. Moreover, Plaintiff was removed from his higher-paying position instead of removing another employee holding the same position, who had more seniority, and the employee who was not demoted was also Hispanic, like Plaintiff, giving the Court further reason to believe that Plaintiff's demotion was not based on race.
The employer sought an award of attorneys' fees to be paid by Plaintiff, based on California Government Code Section 12965(b), which authorizes an award of reasonable attorneys' fees and costs to the prevailing party in a FEHA case under certain circumstances. The trial court awarded the employer nearly $40,000 in attorneys' fees. The Court of Appeal affirmed the award, noting that the employer's entitlement to the award of attorneys' fees under the statute "cannot seriously be questioned" and further stated that "[i]ndeed, the record reflects overwhelming evidence that the lawsuit was unfounded, unreasonable, and frivolous."
Plaintiff argued that the trial court was required to take into consideration his ability to pay when making a fee award. However, the Court of Appeal held that the award of attorneys' fees was proper because the Plaintiff offered no evidence of any kind regarding his inability to pay. The Court of Appeal noted that, in responding to the employer's request for attorneys' fees, the Plaintiff could easily have offered a declaration setting forth his income and other information that would lend support to his position. Thus, the Court of Appeal held that even though it agreed "that a trial court has an obligation to consider a losing party's financial status before assessing attorney fees under the FEHA, on the record before us we are unable to say that the court's fee award was an abuse of discretion."
What does this mean for employers? Practically speaking, if a plaintiff need only provide some evidence to the trial court of their inability to pay such an award, then the point may be moot in many cases. Still, this decision is a good sign for employers, since it is a cautionary tale to plaintiffs pursuing frivolous FEHA claims. It also allows for at least mild optimism that employers may actually be able to recoup some of the costs involved in defending frivolous claims, since not all plaintiffs are necessarily unable to pay.