Carruthers v. Carrier Access Corp.
16 Wage & Hour Cas.2d (BNA) 1553, 2010 Colo. App. LEXIS 1586, 251 P.3d 1199 (2010)
Rule of Law:
Under the Colorado Wage Claim Act, section 8-4-110(1), a trial court has discretion to award attorney fees to a prevailing employer, and such an award does not require a finding that the employee's claim was frivolous or made in bad faith.
Facts:
- Philip Carruthers was employed by Carrier Access Corporation and Turin Networks, Inc. (collectively, Carrier).
- Carrier terminated Mr. Carruthers' employment.
- Mr. Carruthers claimed Carrier failed to pay him approximately $210,000 in commissions owed under a written agreement.
- Mr. Carruthers sued Carrier, asserting claims under the Colorado Wage Claim Act, for breach of contract, and for unjust enrichment.
Procedural Posture:
- Philip Carruthers filed a lawsuit against Carrier Access Corporation and Turin Networks, Inc. (Carrier) in the district court (trial court) for claims including violations of the Colorado Wage Claim Act, breach of contract, and unjust enrichment.
- At trial, the district court directed a verdict in favor of Carrier on Mr. Carruthers' Wage Act claim.
- A jury found in Carrier's favor on Mr. Carruthers' breach of contract and unjust enrichment claims.
- Carrier moved for an award of attorney fees under section 8-4-110(1) and section 13-17-101, requesting $140,442.55.
- Carrier also filed a separate bill of costs for $6,595.72.
- Following a hearing, the district court found an award of fees under section 8-4-110(1) appropriate, initially awarding 67.5% of Carrier's requested fees ($94,798.72), and allowed most of Carrier's requested costs.
- Subsequently, the district court, acting on its own initiative (sua sponte), reduced the attorney fee award to $34,000 without further explanation.
- Mr. Carruthers, as appellant, appealed the district court's award of attorney fees and certain items of costs to the Colorado Court of Appeals.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does section 8-4-110(1) of the Colorado Wage Claim Act permit a court to award attorney fees to a prevailing employer only if the employee's claim was frivolous, or does it grant broader discretion?
Opinions:
Majority - Judge J. Jones
No, the Colorado Wage Claim Act allows a court to award attorney fees to a prevailing employer in its discretion, even if the employee's claim was not frivolous. The court's interpretation relies on the plain language of section 8-4-110(1), which uses the term "may" for fee awards to both employers and employees, indicating a grant of discretion rather than a strict requirement. The court reasoned that to impose a frivolousness requirement would render the Wage Act's attorney fee provision superfluous, as another statute (section 13-17-102) already covers fees for frivolous claims. Furthermore, the legislative history of the 2007 amendments shows a deliberate change from mandatory to discretionary fee awards for both parties, and an explicit proposal to require frivolousness for employer awards was abandoned. The court distinguished this case from federal civil rights cases like Christiansburg Garment Co. v. EEOC, where a frivolousness standard is applied for prevailing defendants, noting that the Wage Act serves to enforce contractual obligations, not to vindicate policies of the "highest priority" like anti-discrimination laws. The court also provided a non-exhaustive list of 10 factors for trial courts to consider when exercising this discretion. While affirming the discretionary authority to award fees, the court vacated the specific fee amount awarded, finding the district court did not provide sufficient findings to explain how it calculated the $34,000 attorney fee award, and remanded for further findings on the reasonableness of the amount.
Analysis:
This case significantly clarifies the scope of a trial court's discretion in awarding attorney fees to prevailing employers under the Colorado Wage Claim Act. By rejecting the "frivolousness" requirement for employer fee recovery, the decision broadens potential liability for employees pursuing wage claims, even if their claims were made in good faith. The establishment of specific factors for courts to consider in exercising this discretion provides much-needed guidance, promoting consistency and helping to balance the policy of protecting employees' wage rights against the concern of deterring nuisance litigation. This framework is crucial for future litigants and attorneys in Colorado wage disputes.
