Mayer Brown team wins $21M in fees after 11-year family battle

A Los Angeles County judge awarded clients of Mayer Brown LLP more than $21 million in attorney fees, after issuing a nearly $70 million bench verdict in an 11-year battle involving one of the richest families in Hong Kong.

"It follows 11 years of hard fought litigation and our view was that our client deserves to be reimbursed for their attorney fees pursuant to the agreement between the parties," Mayer Brown partner John Nadolenco said Wednesday.

Nadolenco and other plaintiffs attorneys won the almost $70 million judgment in March for Rostack Investments Inc. after Superior Court Judge Holly J. Fujie found the daughter of the company's deceased founder was less than credible when she said her father forgave a $30 million loan at a family dinner.

While declining Mayer Brown's request to apply an adjustment that would have bumped the attorney fee award to $26 million, and despite the firm's use of the sometimes criticized block billing method, Fujie ultimately awarded Rostack over $21 million in fees after oral arguments Tuesday.

Defense attorney Skip Miller of Miller Barondess LLP, who represented Angela C. Sabella, daughter of Hong Kong billionaire Chen Din-Hwa, said the fees were unreasonable, arguing that Mayer's practice of block-billing and billing in quarter-hour increments padded its total amount. Sabella has appealed the judgment and fee award.

While Miller's team said 61% of Mayer's billed hours were block-billed and argued that Fujie should apply a downward multiplier of 20% to those hours, she declined to do so since Miller failed to make specific objections to particular entries, she said.

Quoting Christian Research Institute v. Alnor, Fujie recognized, "Blockbilling, while not objectionable, is a risky choice since the burden of proving entitlement to fees rests on the moving party." Christian Research Institute v. Alnor, 165 Cal. App. 4th (2008).

However, after Mayer had met its burden, she found, "It is the burden of the challenging party to point to the specific items challenged, with a sufficient argument and citations to the evidence. General arguments that fees claimed are excessive, duplicative, or unrelated do not suffice."

She said the bill entries were sufficiently detailed and that lowering the value of the hours would be inappropriate particularly since Mayer had already omitted charges by attorneys who worked fewer than 250 hours.

The case involved a $30 million loan the late Chen made to his daughter Sabella through his investment company Rostack. For nearly 11 years, Sabella claimed Chen gave her the loan note at a family meeting on Feb. 8, 2005, when he made an annotation with the word "got" on a document, allegedly indicating the loan was forgiven.

Sabella said her sister Vivien was present. However, following a nine-day bench trial, post-trial briefing, and post-trial arguments in February, Fujie found major discrepancies when a key witness presented evidence showing Chen's annotation had been present on the document in 2003, years before the alleged family meeting. Rostack Investment Inc. v. Angela C. Sabella, BC428298. (L.A. Sup. Ct., filed Dec. 18, 2009).

"As this issue was a significant part of her entire case, her contradictory testimony thereon revealed serious problems with her entire version of the facts as well as with her prior sworn statements in this court," Fujie wrote in her March ruling. "As such, the court finds that Angela lacks credibility as a witness."

Rostack first won summary judgment in 2014 and was awarded $57.5 million, including attorney fees. However, with the help of Miller and attorneys at Gibson, Dunn & Crutcher LLP, Sabella persuaded the 2nd District Court of Appeal to reverse the judgment in 2016.

Los Angeles attorneys Neil M. Soltman, and Jennifer M. Chang of Mayer Brown joined Nadolenco in representing Rostack.

Los Angeles attorneys David W. Schecter and Alexander S. Frid of Miller Barondess joined Miller in representing Sabella. Miller did not respond to a request for comment Wednesday.