Hotel California Forfeits Court Costs In Its Lovely FEHA Case

CATEGORY: Client Update for Public Agencies
CLIENT TYPE: Public Employers
DATE: Mar 04, 2024

Amanda Neeble-Diamond sued the Hotel California by the Sea under the Fair Employment and Housing Act (FEHA).  The trial court entered judgment in favor of Hotel California after a jury concluded Neeble-Diamond was an independent contractor, rather than an employee.

Hotel California filed a cost memorandum as well as a separate motion seeking an award of attorney fees.  The judgment awarded approximately $180,000 in costs that Hotel California had incurred during the litigation.  The trial court denied the motion for attorney fees.  The trial court explained that as a prevailing defendant in a FEHA case, Hotel California was only entitled to attorney fees if Neeble-Diamond’s FEHA claims were objectively frivolous, which Hotel California could not show.  Neeble-Diamond appealed the cost award.

The California Court of Appeal reversed the cost award.  As a general rule, the prevailing party in a lawsuit is entitled to recover allowable costs through a cost memorandum.  But, in FEHA cases, a prevailing defendant has no automatic right to recover costs.  Instead, the defendant must make a motion for the court to award costs, based in part on a specific finding that the case was frivolous.

Hotel California failed to make a motion for an award of cost as required in FEHA cases.  Instead, Hotel California simply filed a cost memorandum.  Because Hotel California failed to file the necessary motion for costs, as it had for attorney fees, it forfeited its court costs.  The Court of Appeal found that the trial court erred in entering a judgment that included the approximately $180,000 cost award.

Neeble-Diamond v. Hotel California by the Sea, LLC., 99 Cal.App,5th 551 (2024). 

Note:  This case is a short and sweet primer regarding collecting trial costs in a FEHA case. 


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