Connerly v. State Personnel Bd.

• Decision Date: 02 March 2006
• Docket Number: No. S125502.,S125502.
• Citation: 37 Cal.4th 1169,129 P.3d 1,39 Cal.Rptr.3d 788
• Parties: Ward CONNERLY, Plaintiff and Appellant, v. STATE PERSONNEL BOARD et al., Defendants and Respondents; The California Business Council for Equal Opportunity et al., Real Parties in Interest and Appellants.
• Court: California Supreme Court

39 Cal.Rptr.3d 788

37 Cal.4th 1169

129 P.3d 1

Ward CONNERLY, Plaintiff and Appellant, v. STATE PERSONNEL BOARD et al., Defendants and Respondents The California Business Council for Equal Opportunity et al., Real Parties in Interest and Appellants.

No. S125502.

Supreme Court of California.

March 2, 2006.

Pacific Legal Foundation, Sacramento, Anthony T. Caso, Bellevue, WA, Deborah J. La Fetra and Timothy Sandefur, Sacramento, for Plaintiff and Appellant.

Ralph D. Black, Sacramento, for Defendants and Respondents Board of Governors of the California Community Colleges and Thomas J. Nussbaum, Chancellor of the California Community Colleges.

Bill Lockyer, Attorney General, Louis R. Mauro, Assistant Attorney General, Catherine Van Aken and Leslie R. Lopez, Deputy Attorney Generals, for Defendants and Respondents Phil Angelides, Treasurer of the State of California, Joan Wilson, Director of the California State Lottery and the California State Lottery Commission.

No appearance for Defendants and Respondents State Personnel Board and Steve Westly, State Controller.

Munger, Tolles & Olson, Jeffrey L. Bleich, San Francisco, Anne M. Voigts and John C. Day, Los Angeles, for Real Parties in Interest and Appellants.

Hugh F. Young, Jr., and Harvey M. Grossman, Los Angeles, for The Product Liability Advisory Council, Inc., as Amicus Curiae on behalf of Real Parties in Interest and Appellants.

MORENO, J.

This case involves litigation over private attorney general fees awarded pursuant to Code of Civil Procedure section 1021.5¹ in an action "which has resulted in the enforcement of an important right affecting the public interest. . . ." Here, plaintiff Ward Connerly successfully pursued litigation to invalidate several state statutes as unconstitutional under article I, section 31 of the California Constitution, enacted in 1996 as Proposition 209, which outlawed governmental preferential treatment by race, sex, and other categories. The state agencies that were the respondents in this writ of mandate action for the most part opted not to defend the statutes, or to litigate only issues of standing and justiciability. It fell to various amici curiae advocacy groups that were in favor of affirmative action to defend the state programs and statutes on the merits. At some point in the litigation, as will be elaborated below, the amici curiae were redesignated real parties in interest. After the litigation concluded, the trial court awarded section 1021.5 attorney fees, to be paid both by the state agencies and the advocacy groups as real parties. The award was upheld by the Court of Appeal.

The advocacy groups contend that they were in essence amici curiae, and were not liable for attorney fees in litigation to declare unconstitutional statutes they were not responsible for enacting or enforcing. Connerly, on the other hand, contends that the advocacy groups should be liable for such fees because they were authentic real parties in interest, inasmuch as they had a direct interest in the litigation and were active participants that often shaped the defense of the statutes. We conclude that the advocacy groups were not "opposing parties" within the meaning of section 1021.5, and therefore reverse the Court of Appeal's judgment.

I. STATEMENT OF FACTS

The underlying litigation involved state and federal constitutional challenges to five statutory programs that fall within the general rubric of "affirmative action." (Connerly v. State Personnel Bd. (2001) 92 Cal.App.4th 16, 27, 112 Cal.Rptr.2d 5.) The litigation challenged the programs of six state agencies and officials: the State Personnel Board, the State Treasurer, the California Community Colleges, the Department of General Services, the State Controller, and the Lottery Commission. Pete Wilson, in his capacity as the Governor of California, commenced the litigation by filing, in the Court of Appeal, a petition for writ of mandate against these agencies and their officials.

A group of organizations and associations who were generally in favor of the challenged programs, the California Business Council for Equal Opportunity, California Coalition of Hispanic Organizations, California Hispanic Chamber of Commerce, California Teachers Association, Hispanic Contractors Association, and Society of Hispanic Professional Engineers, Greater Los Angeles Chapter² obtained permission from the Court of Appeal to appear as amicus curiae. Amicus curiae asserted, among other things, that there was no justiciable controversy because the action was between the Governor and his subordinate executive officers and agencies, and because no real parties in interest had been named. In response, the Governor filed an amended petition for writ of mandate naming the amici curiae as real parties in interest. The California Business Council argued that such designation did not cure the justiciability problem because it was not an authentic real party in interest, with a direct interest in litigation, but rather an amicus curiae that disagreed with the Governor's policies and positions on affirmative action.

The Court of Appeal summarily denied the petition, and this court denied review without prejudice to filing in superior court. Governor Wilson then filed his petition for a writ of mandate in the superior court. In so doing, he again named the California Business Council as real party in interest. Later, plaintiff Ward Connerly was permitted to join the litigation as a taxpayer litigant. (Connerly v. State Personnel Bd., supra, 92 Cal.App.4th at p. 27, 112 Cal.Rptr.2d 5.) Connerly continued the litigation after Governor Wilson left office. (Ibid.)

The California Business Council actively participated in the litigation. It initially sought to remove the case to federal court, an action in which the state defendants did not join, and which was rejected because of the state defendants' lack of concurrence. Once back in superior court, the California Business Council filed a motion to peremptorily challenge the trial judge, Thomas Cecil, which ultimately was successful. (See California Business Council v. Superior Court (1997) 52 Cal.App.4th 1100, 1107-1108, 62 Cal.Rptr.2d 7.) It sought discovery regarding the affirmative action policies and practices of the various state agencies named in the litigation, and filed a successful motion to compel discovery when the Governor was not forthcoming.

Shortly after the case was returned to the superior court, the voters passed Proposition 209, adding article I, section 31 to the California Constitution, prohibiting the state, inter alia, from granting "preferential treatment to . . . any individual or group on the basis of race. . . ." Three of the six state agencies and officials that were sued, the State Personnel Board, the Department of General Services, and the State Controller, took no position on the litigation, claiming only that they were compelled to enforce existing statutes under article III, section 3.5 of the California Constitution. The State Treasurer and the Lottery Commission opposed the lawsuit on grounds of standing, justiciability, and lack of adversity, but did not otherwise defend on the merits any affirmative action program or statute. The Board of Governors of the California Community Colleges is the only state agency that appears to have defended its programs and the pertinent statutes on the merits as well as on issues of standing and justiciability.

Eventually, the trial court entered a judgment invalidating one of the statutory schemes, as well as a portion of another, but otherwise upholding them. (Connerly v. State Personnel Bd., supra, 92 Cal. App.4th at p. 27, 112 Cal.Rptr.2d 5.) Connerly appealed and the California Business Council cross-appealed those portions of the judgment at variance with its members' respective positions. (Id. at p. 28, 112 Cal.Rptr.2d 5.)

The Court of Appeal held that the statutory schemes were unconstitutional for the most part, but that certain portions of three of those schemes could be severed and upheld. (Connerly v. State Personnel Bd., supra, 92 Cal.App.4th at p. 28, 112 Cal.Rptr.2d 5.) After judgment was entered, Connerly moved for an award of attorney fees pursuant to section 1021.5. The trial court determined that this was an appropriate case in which to make an award of attorney fees pursuant to section 1021.5, a ruling that was not challenged on appeal. The total attorney fee award was eventually calculated at $488,067.64. The trial court ordered that the State Personnel Board, the California Community Colleges, the State Treasurer, the Lottery Commission, the Department of General Services, and the California Business Council each pay one-sixth of the total amount of attorney fees, rejecting the California Business Council's contention that it should not be liable for such fees. The California Business Council appealed, and plaintiff Connerly cross-appealed to challenge the disallowance of a portion of the fees claimed by his attorneys.

The Court of Appeal affirmed the trial court's attorney fee award. It reviewed various Court of Appeal cases, discussed below, holding that real parties in interest that actively participate in litigation may be assessed attorney fees, even though they were not responsible for initiating or enforcing the policies that were the subject of the underlying litigation. The Court of Appeal focused on the trial court's finding that the California Business Council groups "participated in the litigation as full-fledged parties," distinguishing themselves from the typical amicus curiae. The Court of Appeal also rejected Connerly's cross-appeal. We granted the California Business Council's petition for review.³

II. DISCUSSION

A. Standard of Review

The Court of Appeal reviewed the trial court's award of fees under an abuse of discretion standard. The parties argue about the proper standard, with the California Business Council contending that the...