The state appellate court on Monday refused to reconsider an earlier ruling denying attorney Cory Briggs $258,629 in fees for a lawsuit he brought against the city of San Diego.
However, the court did modify its opinion published on Sept. 22 to remove references to “illegal,” “illicit” and “criminal conduct” out of “an abundance of caution.”
The court rejected arguments that it relied on the wrong statute when it ruled against Briggs. Three appellate justices said criminality didn’t factor into their ultimate decision — which stated “that a suspended corporation may not recover attorney fees … while both it and its attorney knew it was suspended.”
Briggs was representing the nonprofit San Diegans for Open Government (SDOG) at a time when its corporate status was suspended by the state’s Franchise Tax Board.
Paul Pfingst, who filed the appeal for Briggs and SDOG, said his clients will “probably be appealing to the Supreme Court.” He questioned the “real-world implications” of the court’s ruling.
Briggs had sought fees for work he did on behalf of SDOG that successfully challenged a proposed San Diego tax that would have financed an expansion of the downtown convention center. The Superior Court initially ruled against Briggs.
On appeal, Briggs and activist Mel Shapiro — who filed a separate action — won. SDOG asked for attorneys fees in December 2014 in the amount $862,404.
At that time, the city raised the issue that Briggs’ client — SDOG — was suspended by the California Franchise Tax Board and Briggs knew it when he filed the lawsuit. By that time, a paralegal at Briggs Law Corp. had filed necessary paperwork and the corporation was reinstated.
Superior Court Judge Gregory Pollack warned Briggs at the time that he could be in trouble with the California State Bar or the authorities, but in the end awarded SDOG $258,629 in attorney fees for the time during the case that the nonprofit was not under suspension.
The court of appeal struck down those fees in September and, in essence, affirmed that decision Monday.
In its initial opinion, the appeals court said, “We determine that attorney fees cannot be awarded to a party whose attorney violates the law to appear in the action and offers no justification whatsoever for his or her conduct. To require taxpayers to compensate a party or a law firm for unethical, unprofessional, or even illegal conduct, under the guise that the litigant is protecting the public interest, would turn the private attorney general statute on its head.”
The word “illegal” is now struck from that paragraph.
Pfingst argued SDOG’s conduct wasn’t illegal — the group had neglected to file a required tax form, not neglected to pay taxes. Not paying taxes is a crime, Pfingst’s brief said. Failing to file a tax form is a violation, but it’s not a crime, he said.
Yet the court’s criticism concerned Briggs as an attorney, not SDOG’s conduct — Briggs was the one who knowingly entered into a court case while representing a suspended corporation.
There is a financial incentive, the state court opinion read, for attorneys to protect the public against government missteps. But, it continued, “it should not be such a tantalizing carrot that it causes an attorney to behave unethically and unprofessionally or otherwise forget his or her role as an officer of the court.”
In this case, it continued, “this is precisely what occurred as to [Briggs’] representation of SDOG.”
“SDOG was given multiple opportunities to explain its actions,” the court wrote Monday. “It made the strategic decision not to do so. Merely because SDOG’s strategy did not ultimately prove successful does not compel this court to provide SDOG with another bite of the proverbial apple.”
Disclaimer: San Diegans for Open Government is currently suing inewsource, KPBS and San Diego State University challenging the legality of their lease agreements. The Superior Court dismissed the case, concluding that it was prompted by inewsource’s investigative journalism, but SDOG has appealed.
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