Cano v. >Anaheim> Arena
Management



















Filed 2/6/12 Cano v. Anaheim Arena Management CA4













>NOT TO BE PUBLISHED IN OFFICIAL REPORTS







California
Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or
relying on opinions not certified for publication or ordered published, except
as specified by rule 8.1115(b). This
opinion has not been certified for publication or ordered published for
purposes of rule 8.1115.









IN
THE COURT OF APPEAL OF THE STATE OF CALIFORNIA



FOURTH
APPELLATE DISTRICT



DIVISION
THREE




>

LUZ ELENA CANO, Plaintiff and Appellant, v. ANAHEIM ARENA MANAGEMENT, LLC, Defendant and Respondent.

G044751 (Super. Ct. No. 30-2008-00114177) O P I N I O N

Appeal
from a postjudgment order of the Superior
Court of href="http://www.adrservices.org/neutrals/frederick-mandabach.php">Orange
County, Kirk H. Nakamura, Judge. Affirmed.

Pivo,
Halbreich, Martin, Wilson & Amo and Scott A. Martin for Plaintiff and
Appellant.

Waters,
McCluskey & Boehle and Gregg W. Brugger for Defendant and Respondent Anaheim
Arena Management.

* * *

Plaintiff and appellant
Luz Elena Cano, M.D., appeals from a postjudgment order denying her motion to
tax costs and awarding defendant and respondent Anaheim Arena Management, LLC,
aka Honda Center (Arena Management) expert witness fees under Code of Civil
Procedure section 998. (All statutory
references are to the Code of Civil Procedure unless otherwise noted.) Under section 998, Arena Management offered
to settle Cano’s personal injury claims for $100,001 and a costs waiver, but
Cano rejected that offer. After the
trial court granted its summary judgment motion, Arena Management filed a
memorandum of costs seeking $18,957 in expert witness fees because Cano failed
to obtain a judgment more favorable than the section 998 settlement offer.

Cano
contends the trial court abused its discretion in awarding Arena Management
expert witness fees because the serious injuries she suffered made the settlement
offer unreasonable. Cano, however,
failed to show any likelihood Arena Management would have been held liable for
her injuries or that Arena Management’s offer bore no relation to the monetary
damages she suffered. Accordingly, we
find no abuse of discretion and affirm the trial court’s ruling.

I

Facts and Procedural Historyhref="#_ftn1" name="_ftnref1" title="">[1]

Cano attended a Bruce Springsteen
concert at the Honda Center in Anaheim. During the concert, defendant Andrew Hoel was
climbing the stairs to his seat when he fell backwards and landed on Cano’s
head. Arena Management administers the
Honda Center’s operations.

Cano sued Hoel and Arena
Management for her injuries, including permanent blindness in her left eye that
required her to close her medical practice.href="#_ftn2" name="_ftnref2" title="">[2] Cano asserted claims for assault, battery,
and negligence against Hoel, alleging he fell on her because he was grossly
intoxicated. Cano asserted multiple
negligence claims against Arena Management because it failed to protect her from
Hoel. Specifically, Cano alleged Arena
Management failed to provide adequate security and negligently allowed Hoel to
enter the arena despite appearing grossly intoxicated when he passed through
security. Hoel died from a heart
condition six months after the concert.

Arena Management moved for href="http://www.fearnotlaw.com/">summary judgment, arguing it did not
breach any duty of care it owed to Cano because it adequately screened each
concertgoer before admitting him or her into the Honda Center and received no
reports or complaints about Hoel from security personnel or other concertgoers
before Hoel fell on Cano. The trial
court continued the hearing on Arena Management’s motion several times so Cano
could conduct additional discovery, including deposing Hoel’s widow, who attended
the concert with him.

Hoel’s widow testified he appeared
“totally calm, totally normal” as he passed through security screening outside
the arena and “[y]ou would never think by looking at him that he drank . . .
.” She further testified there were no
outward signs that would put someone on notice Hoel might be intoxicated as he
entered the arena. Finally, Hoel’s widow
characterized him as a functional alcoholic and described how he successfully
interviewed for a job after drinking.

Two weeks after the parties
deposed Hoel’s widow, Arena Management served Cano with a section 998 offer to
settle Cano’s claims for $100,001 and a costs waiver. Cano rejected the offer.

At the hearing on Arena
Management’s summary judgment motion, Cano argued there was a triable issue of
fact because it could be inferred Hoel appeared grossly intoxicated when he
entered the Honda Center based on evidence Hoel was intoxicated when he later
fell on Cano. Cano did not dispute the testimony
by Hoel’s wife regarding his appearance as he passed through security
screening. The trial court granted Arena
Management’s motion, finding Arena Management adequately screened all
concertgoers before entering the arena and the evidence did not support Cano’s
inference that Hoel appeared grossly intoxicated when screened by security
personnel. We affirmed that ruling in a
separate opinion. (Cano v. Staff Pro, supra.)

After the trial court entered
judgment in its favor, Arena Management filed a href="http://www.mcmillanlaw.com/">memorandum of costs seeking $18,957 in
expert witness fees based on Cano’s failure to obtain a judgment more favorable
than Arena Management’s section 998 settlement offer. Cano filed a motion to tax these expert
witness fees, arguing the settlement proposal was a “token offer” made without
any reasonable expectation Cano would accept it and therefore could not support
an award of expert witness fees under section 998.href="#_ftn3" name="_ftnref3" title="">[3]


The trial court denied the motion
and awarded Arena Management its expert witness fees. The court explained, “Dr. Cano, I really feel
for you in terms of what happened here.
[¶] But based on the case law, I
can’t say that almost under any circumstance $100,000, plus, is a token
offer. I don’t think that’s what the
Court of Appeal defines as a token offer, and particularly when they held in
certain situations that a waiver of costs can, in certain circumstances, be a
legitimate offer which would entitle the prevailing defendant to expert fees
under CCP 998.” Cano timely
appealed.

II

Discussion

A. Legal
Principles Governing Recovery of Expert Witness Fees Under Section 998

Section 998 grants the trial court
discretion to award expert witness fees to a defendant when the plaintiff
rejects the defendant’s reasonable pretrial settlement offer and fails to
obtain a more favorable judgment.href="#_ftn4"
name="_ftnref4" title="">[4] (§ 998, subd. (c)(1).) Section 998’s purpose is to encourage
pretrial settlements “‘“by providing a strong financial disincentive to a party
. . . who fails to achieve a better result than that party could have achieved
by accepting his or her opponent’s settlement offer.” [Citation.]’
[Citation.]” (>People ex rel. Lockyer v. Fremont General
Corp. (2001) 89 Cal.App.4th 1260, 1270‑1271 (>Fremont); >Hartline v. Kaiser Foundation Hospitals
(2005) 132 Cal.App.4th 458, 471 (Hartline).)

“To effectuate the purpose of the
statute, a section 998 offer must be made in good faith to be valid. [Citation.]
Good faith requires that the pretrial offer of settlement be ‘realistically
reasonable under the circumstances of the particular case. Normally, therefore, a token or nominal offer
will not satisfy this good faith requirement, . . .’ [Citation.]
The offer ‘must carry with it some reasonable prospect of
acceptance. [Citation.]’ [Citation.]
One having no expectation that his or her offer will be accepted will
not be allowed to benefit from a no-risk offer made for the sole purpose of
later recovering large expert witness fees.
[Citation.]” (>Jones v. Dumrichob (1998)
63 Cal.App.4th 1258, 1262-1263 (Jones).)

A section 998 offer’s
reasonableness must be judged by examining the circumstances existing at the
time the offer was made. (>Hartline, supra, 132 Cal.App.4th at p. 471.) “Whether an offer to compromise is made in
good faith, however, cannot be measured by the amount of claimed damages or a
party’s subjective belief in the case’s value.
An offer to compromise may be ‘realistically reasonable’ and justify
cost shifting even though the party receiving the offer is unlikely to accept
it as a consequence of the party’s skewed valuation of the case.” (Essex
Ins. Co. v. Heck (2010) 186 Cal.App.4th 1513, 1530 (>Essex).)
“‘[W]hen a party obtains a judgment more favorable than its pretrial
offer, [the offer] is presumed to have been reasonable and the opposing party
bears the burden of showing otherwise.’
[Citations.]” (>Id. at p. 1528.)

“‘“Whether a section 998 offer was
reasonable and made in good faith is left to the sound discretion of the trial
court.” [Citation.] “In reviewing an award of costs and fees
under . . . section 998, the appellate court will examine the
circumstances of the case to determine if the trial court abused its discretion
in evaluating the reasonableness of the offer or its refusal.” [Citation.]
“‘[“]The burden is on the party complaining to establish an abuse of
discretion, and unless a clear case of abuse is shown and unless there has been
a miscarriage of justice a reviewing court will not substitute its opinion and
thereby divest the trial court of its discretionary power.” [Citations.]’” [Citation.]’
[Citation.]” (>Essex, supra, 186 Cal.App.4th at pp. 1528-1529.)

B. Cano
Failed to Establish the Trial Court Abused Its Discretion in Awarding Arena
Management Expert Witness Fees

Arena Management offered to settle
Cano’s claims for $100,001 and a costs waiver.
In determining whether the trial court abused its discretion when it
concluded Arena Management made a reasonable offer, we must consider the value
of Arena Management’s offer to waive its costs, including the nearly $19,000 in
expert witness fees at issue on this appeal and the approximately $6,000 in
ordinary costs described in its memorandum of costs. (Essex,
supra, 186 Cal.App.4th at
p. 1529 [“A defendant’s offer to waive costs may carry significant value
to the plaintiff because, if accepted, it eliminates the plaintiff’s exposure
to expert witness costs”]; Jones, >supra, 63 Cal.App.4th at
p. 1263 [defendant’s section 998 settlement offer to waive its claim for
$5,440 in expert witness fees and $9,115.46 in ordinary costs had “significant
monetary value” and therefore was not a token offer].) These costs bring the total value of Arena
Management’s section 998 offer to $125,000.

Cano contends Arena Management’s
settlement proposal was merely a token offer that lacked good faith. According to Cano, Arena Management knew she
would not accept the offer because of her debilitating injuries and tendered
the offer solely to make itself eligible to recover expert witness fees under
section 998. Cano’s serious injuries,
however, do not establish Arena Management’s offer was unreasonable or lacked
good faith because she failed to show any likelihood that Arena Management
would be held liable for those injuries or that Arena Management’s offer bore
no relation to the monetary damages she suffered in treating her injuries.

In evaluating the reasonableness
of a section 998 settlement offer, courts must look to how well the offer
approximates the amount the defendant would pay if found liable, discounted by
an appropriate factor for the plaintiff’s likelihood of success. (Thompson
v. Miller (2003) 112 Cal.App.4th 327, 339, fn. 4.) “[A] ‘“modest settlement offer” may be in
good faith if it is believed the defendant has a significant likelihood of
prevailing at trial.’ [Citation.]” (Essex,
supra, 186 Cal.App.4th at
p. 1529.) For example, a
defendant’s offer to waive costs can be a reasonable, good faith settlement
offer under section 998 when a plaintiff’s claims have little likelihood of
success. (See, e.g., >Essex, at pp. 1528-1530; >Jones, supra, 63 Cal.App.4th at pp. 1263-1264; >Hartline, supra, 132 Cal.App.4th at pp. 471-473.)

Here, Arena Management maintained
throughout the litigation that it had no liability because it did not breach
any duty of care it owed Cano. Arena
Management served its section 998 settlement offer nearly five months after
serving a summary judgment motion that presented evidence showing it had no
liability and included an expert declaration opining Arena Management provided
adequate security for the concert.
Moreover, just two weeks before Arena Management served its section 998
offer, Hoel’s wife testified at deposition that he appeared “totally calm,
totally normal” as he passed through security screening and “[y]ou would never
think by looking at him that he drank . . . .”

Thus, at the time Cano received
the settlement offer, she knew her claims faced significant obstacles that
reduced her likelihood of success.
Indeed, she knew Arena Management disputed liability and the only direct
evidence regarding Hoel’s appearance as he passed through security screening
showed he did not appear
intoxicated. Moreover, the trial court’s
later decision granting Arena Management’s summary judgment motion is prima
facie evidence that Arena Management’s settlement offer was reasonable. (Jones,
supra, 63 Cal.App.4th at
p. 1264.) Cano makes no attempt to
address her likelihood of success despite bearing the burden to show the trial
court abused its discretion in finding the offer was reasonable. (Essex,
supra, 186 Cal.App.4th at
p. 1529; Jones, at
p. 1264.)

Cano also makes no attempt to
explain how a $125,000 offer could be a token offer in this particular
case. She contends the offer was
unreasonable because she suffered devastating injuries that left her blind in
one eye and forced her to close her medical practice. Arena Management’s experts, however, disputed
that Cano’s eyesight problems were caused by Hoel because these problems did
not surface until three months after the incident, which supported their claim
Cano suffered from a preexisting eye condition.
Moreover, Cano failed to present any evidence regarding the amount of
monetary damages she suffered due to her injuries.href="#_ftn5" name="_ftnref5" title="">[5] She also failed to identify the amount of any
demand she may have made on Arena Management.
Without something to compare to Arena Management’s offer, we cannot say
the offer was a token one lacking in good faith.

Simply put, a settlement offer
worth $125,000 is a significant offer and Cano cites no authority that
concludes an offer comparable to Arena Management’s amounted to a token
offer. To the contrary, at least one
case found a settlement offer comparable to Arena Management’s was made in good
faith. In Santantonio v. Westinghouse Broadcasting Co. (1994)
25 Cal.App.4th 102, the Court of Appeal found the trial court did not
abuse its discretion when it awarded expert witness fees based on a $100,000
settlement offer, despite the plaintiff’s claim of more than $900,000 in
economic damages: “[T]he mere fact that
[plaintiff] claimed projected economic losses of over $900,000 does not mean
that defendants’ $100,000 offer was unreasonable or unrealistic. Defendants contended that they had no
liability to [plaintiff] at all, and the jury ultimately agreed. Moreover, defendants contended that the
damage estimates by plaintiffs’ expert were greatly excessive . . . .” (Id.
at p. 118.) Santantonio is readily analogous to this case.

To support her contention Arena
Management’s offer was unreasonable, Cano cites Wear v. Calderon (1981) 121 Cal.App.3d 818 (>Wear) and Pineda v. Los Angeles Turf Club, Inc. (1980)
112 Cal.App.3d 53 (Pineda). Wear
and Pineda are credited with
establishing the requirement that a section 998 settlement offer must be
reasonable and in good faith to support an award of expert witness fees. In applying these general principles,
however, subsequent cases have repeatedly emphasized the specific facts in each
case may lead to a different conclusion.
(See, e.g., Essex, >supra, 186 Cal.App.4th at
p. 1529; Fremont, >supra, 89 Cal.App.4th at
pp. 1272-1273; Jones, >supra, 63 Cal.App.4th at
p. 1263; Culbertson v. R. D. Werner
Co., Inc. (1987) 190 Cal.App.3d 704, 708-710 (Culbertson).) Similarly, the
facts here are readily distinguishable from those in Wear and Pineda.

In Wear, the Court of Appeal reversed an award of expert witness fees
because it found a nominal $1 settlement offer lacked good faith when compared
to the plaintiff’s $18,500 in damages. (>Wear, supra, 121 Cal.App.3d at p. 821.) In Pineda,
the Court of Appeal affirmed the trial court’s conclusion a $2,500 settlement
offer was a token offer when compared to the $10 million the plaintiffs
sought. (Pineda, supra,
112 Cal.App.3d at pp. 62-63.)
Both courts stressed that they based their decision on “the circumstances
of the particular case.” (>Wear, at p. 821; >Pineda, at p. 63.) Unlike Wear
and Pineda, we have no information
regarding the amount of Cano’s damages or any demand she made on Arena
Management. Furthermore, Arena
Management’s $125,000 offer is not comparable to the nominal offers at issue in
Wear and Pineda.

Finally, Cano contends the trial
court abused its discretion in finding Arena Management’s offer was reasonable
and made in good faith because the court ignored Arena Management’s timing,
purpose, and lack of any reasonable expectation that Cano would accept the
offer. Because Arena Management did not
make the offer until after the parties completed virtually all depositions and
after Arena Management incurred nearly all of its expert witness fees, Cano
argues Arena Management had no reasonable expectation she would accept the
offer and the offer did not serve section 998’s purpose of encouraging early
settlements. Cano, however, waived this
argument by waiting until her reply brief to raise it. (Karlsson
v. Ford Motor Co. (2006) 140 Cal.App.4th 1202, 1216 [arguments raised
for the first time in the reply brief are waived].)

Moreover, the argument lacks
merit. Section 998’s purpose is to
encourage pretrial settlements regardless of whether the settlements are
reached early or late in the litigation.
Section 998 authorizes a party to make a settlement offer subject to its
terms “[n]ot less than 10 days prior to commencement of trial.” (§ 998, subd. (b).) If section 998 was limited to early
settlements, it would not authorize settlement offers on the eve of trial. Language to the contrary that Cano cites in >Culbertson, supra, 190 Cal.App.3d at p. 711, is taken out of context
and does not limit section 998’s cost shifting to “early” settlement offers.

Often parties cannot make a
reasonable settlement offer until after they conduct discovery and investigate
the underlying facts. Here, Arena
Management made its offer less than two weeks after deposing the only known
witness who observed Hoel pass through security screening. Nothing about Arena Management’s timing,
purpose, or expectation of acceptance suggests its offer was unreasonable or
lacking in good faith.

Cano bore the burden to show the
trial court abused its discretion in finding Arena Management’s offer was
reasonable and made in good faith.
Cano’s conclusion her devastating
injuries made the offer unreasonable does not meet that burden because she
failed to show any likelihood Arena Management would have been held liable for
those injuries or that Arena Management’s offer bore no relation to the
monetary damages she suffered due to her injuries. We therefore affirm the trial court’s ruling.

III

Disposition

The postjudgment order is
affirmed. Arena Management shall recover
its costs on appeal.







ARONSON,
J.



WE CONCUR:







MOORE, ACTING P. J.







FYBEL, J.