California's discovery statutes serve several foundational goals within civil litigation. They promote fair resolution of disputes, facilitate the efficient exchange of information, and ensure that parties comply with procedural obligations designed to narrow issues and avoid unnecessary gamesmanship. Discovery sanctions, and, more specifically, fee-shifting, operate within this framework as tools that encourage compliance, deter misuse, and protect the integrity of the judicial process. Fee-shifting serves the additional function of placing the financial burden caused by discovery violations on the party and/or counsel responsible for the misconduct, instead of the innocent litigant.
The recent decision in Baer v. Tedder examines the full scope of these statutory purposes and confirms that the fee-shifting provisions in Code of Civil Procedure sections 2023.030(a) and 2031.320(b) authorize recovery of attorney's fees incurred not only in the trial court but also after an unsuccessful appeal of the trial court’s order. The court of appeal's analysis underscores the remedial nature of discovery sanctions, clarifies the breadth of the fee-shifting mechanism, and provides an instructive roadmap for assessing fee motions once a sanctions order has been affirmed. The decision also functions as a cautionary tale for attorneys subjected to discovery sanctions jointly and severally with their clients: such attorneys put themselves at risk of further fee-shifting if they join with their clients in an appeal of a sanctions order.
Statutory Authority for Appellate Attorney's Fees
Code of Civil Procedure sections 2023.030(a) and 2031.030(b) "authorize the imposition of monetary sanctions, which include attorney's fees, against a litigant who misused the discovery process, or unsuccessfully made or opposed a motion to compel compliance with an inspection demand." The central issue before the court in Baer was whether sections 2023.030(a) and 2031.320(b) authorize recovery of attorney’s fees after successfully defending discovery sanctions on appeal. The court answered this question in the affirmative.
The case arose out of an action filed by Baer against Tedder for malicious prosecution. After numerous appeals spanning almost 30 years, this appeal addressed a request for fees following an earlier, unsuccessful appeal of $10,475 in discovery sanctions awarded by the trial court against Tedder and his counsel, Kent. After that appeal, the trial court awarded an additional $113,532.50 in fees against Tedder, even though Kent had joined in the earlier appeal, for fees associated with Baer’s defense of the $10,475 sanctions order.
On appeal, Tedder argued that the statutes do not permit the recovery of fees incurred on appeal. The court of appeal recognized that whenever a statute authorizes an award of attorney fees in the trial court, those fees include fees incurred on appeal unless the statute expressly provides otherwise. Sections 2023.030(a) and 2031.320(b) authorize the imposition of monetary sanctions that include reasonable expenses such as attorney's fees. Neither statute contains any language restricting fees to trial-level work.
Both statutes operate as cost-shifting provisions that provide compensation for all expenses caused by discovery misuse. The court emphasized that discovery sanctions are not punitive, but rather are meant to reimburse the innocent party for the financial burden imposed by the misuse. It, therefore, would undermine the purpose of the statutes if a party, like Baer, was left having to pay nearly ten times the original sanctions amount in its defense of those sanctions.
Reasonableness of the Fee Award
The next question before the court concerned the amount of appellate attorney's fees awarded to Baer. Tedder contested both the amount of hours and the rates that led to the award of $113,532. The lodestar method remains the starting point for fee calculations. (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1132.) Such calculations are made by multiplying the reasonable hourly rate for comparable services in the relevant community by the amount of hours reasonably expended. Trial courts may adjust the lodestar upward or downward to reflect the fair market value of the services.
Hours Reasonably Expended on the Appeal
Baer's counsel expended 116.9 hours litigating the prior appeal. The court of appeal found the amount of time reasonable since the tasks included extensive review and analysis of Tedder's opening brief, legal research, preparation of a detailed chronological factual outline, drafting of a forty-page respondent's brief, preparation of the appendix, review of the reply brief, preparation for and appearance at oral argument, and post-decision review.
The court further emphasized that the issues, while not unusually complex, were demanding due to the breadth of challenges raised. In addition, Tedder's contention that Baer's counsel engaged in fraudulent padding lacked evidentiary support but still needed to be addressed.
Hours Spent on Fee Motion
Baer also sought fees for 31.9 hours spent preparing the motion for appellate fees. The court determined that only 25 hours was reasonable, and thus reduced the amount by $6,727, corresponding to the reduction of 6.9 in hours.
Reasonable Hourly Rates
The trial court accepted the hourly rates ranging from $550 to $975. The court explained that a reasonable hourly rate reflects the market value of services and may exceed the discounted rates actually charged to the client. (Pasternak v. McCullough (2021) 65 Cal.App.5th 1050.)
Baer submitted declarations from two experienced Southern California litigators attesting to the reasonableness of the rates. The trial judge also relied on personal knowledge of the local legal market. The court accepted the rates with one exception. The attorney who drafted the fee motion did not justify having the highest rate, and for that timekeeper, the court of appeal applied a rate of $775 per hour, resulting in a reduction of $5,000.
Billing Documentation
Baer submitted redacted invoices form his counsel. These invoices demonstrated that Baer was billed for the work and was expected to pay for it. The court stressed that there is no requirement to submit proof of payment before a prevailing party may recover fees. The court also rejected Tedder's argument about block billing. Although some entries combined multiple tasks, the documentation was sufficiently clear to identify compensable work.
Joint and Several Liability for Appellate Fees
The final issue concerned which parties should bear liability for the appellate fee award. The trial court imposed appellate fees solely against Tedder on the theory that a jointly liable attorney cannot appeal separately and therefore should not be responsible for appellate fees. In other words, since Kent was “stuck with” Tedder on the appeal of the underlying sanctions order, Kent should not be subjected to further fee-shifting resulting from that appeal.
The appellate court rejected this reasoning. No statute or rule requires all parties subject to a joint and several sanctions order to join in the same appeal. Each jointly liable obligor may independently decide whether to appeal. An attorney has a separate right from the client to appeal sanctions imposed against him but is not required to do so.
Since Kent voluntarily appealed and since the trial court had already found him jointly and severally responsible for the original sanctions, he contributed to the additional fees that Baer incurred through challenging those sanctions on appeal. Full compensation required imposing appellate fees jointly and severally against both Tedder and Kent.
Conclusion
The decision in Baer v. Tedder provides important clarification regarding the scope and purpose of the fee-shifting provided for under California’s discovery statutes. The court confirmed that the compensatory intent of Code of Civil Procedure sections 2023.030(a) and 2031.320(b) extends to appellate attorney's fees. The opinion reinforces the principle that parties who misuse the discovery process cannot defeat the compensatory purposes of sanctions by forcing the prevailing party into an appeal without responsibility for the resulting fees. Finally, the court held that attorneys who are jointly and severally liable for sanctions may be jointly liable for appellate fees if they join in an appeal that challenges those sanctions.
