Facts

The litigation stems from a breach of contract dispute between plaintiff Layne Leslie Britton and Cloudbreak Entertainment Inc. that was entered into in 2000. Under the Agreement, Britton was to provide services (the nature of which was disputed by the parties) to Cloudbreak in exchange for a fee in the form of a percentage of Cloudbreak's income from television projects. As pertinent here, the Agreement provides that "[i]f either party commences an action against the other party arising out of or in connection with this Agreement, the prevailing party shall be entitled to recover from the losing party its reasonable attorneys' fees."

Cloudbreak paid Britton $1.877 million under the Agreement through 2006. In 2007, Cloudbreak's Conrad Riggs told Britton that Cloudbreak was no longer receiving income from television projects covered by the Agreement and therefore did not owe Britton further payments. In November 2012, Britton sued Cloudbreak and Riggs (who Britton alleged was the sole owner of Cloudbreak) for breach of contract and breach of fiduciary duty. Britton subsequently amended his complaint to add claims for conversion, open book account, money had and received, quantum meruit, fraud, and receipt of stolen property.

Defendants filed a cross-complaint against Britton, which they subsequently amended, alleging claims for professional negligence, breach of fiduciary duty, declaration, and unjust enrichment. Defendants alleged that Britton acted as Cloudbreak's attorney, rather than a business advisor, and that the Agreement did not comply with California Business and Professions Code section 6147 concerning attorney contingency fee agreements, seeking to void the agreement. Defendants also alleged Britton caused them millions of dollars in damages in connection with a separate agreement they had with Mark Burnett, as well as sought the return of the amount they paid Britton.

Result

At trial in 2016, the jury found, in relevant part, in favor of Britton on his breach of contract claim awarding him $489,850.00 in damages against Cloudbreak, and in favor of Britton on his money had and received claim, but returning no additional damages against Riggs and Cloudbreak. After a series of appeals, the appellate court found that Britton provided legal services under the consulting agreement and the agreement therefore was voidable by Riggs and Cloudbreak. The trial court entered judgment in favor of Conrad Riggs and Cloudbreak Entertainment, Inc., awarding $4,535,759 (of a requested $5,827,749) in attorneys' fees and costs.