Monday, October 11, 2010

PA Superior Court Affirms Award of $210,704.79 in Attorneys' Fees Under Wage Payment & Collection Law

In Ambrose v. Citizens National Bank of Evans City, No.: 10-3156 (Pa. Super. 9/17/2010), the Pennsylvania Superior Court held that the Wage Payment and Collection Law permits a trial court to make an award of attorneys fees incurred by a successful plaintiff in defending against an employer's counterclaim, where that counterclaim is "inextricably intertwined" with plaintiff's wage claim.

In Ambrose, the plaintiffs sued their former employer under the Pennsylvania Wage Payment and Collection Law, arguing that the employer failed to pay to plaintiffs commissions that were due, and sought compensation, interest, liquidated damages and attorneys fees. The employer filed a counterclaims, alleging unfair competition, breach of fiduciary duties and conspiracy. After trial, the lower court found in favor of the plaintiffs and awarded them $210,704.79 in attorneys fees. Specifically, the trial court determined that employer's counterclaims were without merit, and were pursued by employer for the purpose of intimidating plaintiffs into dropping their wage claims.

Employer appealed, arguing that the trial court committed multiple errors, such as: (1) awarding attorneys' fees to plaintiffs for work performed in defending against employer's counterclaims; (2) including in its calculation of attorneys fees the work performed by plaintiffs' attorneys on appeal; and (3)awarding an unreasonable sum of attorneys' fees.

The Superior Court rejected employer's arguments and affirmed the trial court's award of the attorneys' fees. Specifically, the Superior Court held that the trial court's inclusion of the time plaintiffs were forced to spend defending employer's counterclaims was properly counted in calculating the award of attorneys' fees, because employer's counterclaims were "inextricably intertwined," with plaintiffs' wage claims so as to fall under the fee-award provision of the Wage Payment and Collection Law. The Court also held that awarding attorneys fees for work performed through the appeal process was also proper because including such fees furthers the legislative purposes behind the Wage Payment and Collection Law of making employees who are denied compensation whole. Finally, the Court held that the employer had failed to introduce sufficient evidence to challenge the reasonableness of the hourly rates or fees that were submitted by the plaintiffs and relied upon by the trial court in calculating the final award of attorneys' fees.

Consequently, the Court affirmed the trial court's award of $210,704.79 in attorneys fees against the employer.

The Superior Court's full opinion can be read here: http://www.superior.court.state.pa.us/opinions/A09027_10.pdf