Law Firm Represented by Of Counsel Cannot Recover Attorney’s Fees As Prevailing Party

  It is well settled law in California that when a law firm is the prevailing party in a lawsuit and it is represented by one of its partners, members, or associates, it cannot recover attorney fees even though the litigation is based on a contract with a prevailing party attorney fee provision.

  Can a law firm, however, recover attorney fees under a prevailing party clause when the firm is a successful litigant represented by “of counsel”? The Second Appellate District says: “No.”

  In Sands & Associates v. Juknavorian the court held that because the relationship between a law firm and “of counsel” is close, personal, regular, and continuous, a law firm and “of counsel” constitute a single, de facto firm, and thus a law firm cannot recover attorney fees under a prevailing party clause when, as a successful litigant, it is represented by “of counsel.”

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