Title: Vasquez v. State of California
Citation: 43 Cal. 4th 243 original opinion 45 Cal. 4th 308a modification
Docket Number: S143710, S143710m
State: California
Issuer: California Supreme Court
Date: November 20, 2008

1
Filed 11/20/08 
 
 
 
 
IN THE SUPREME COURT OF CALIFORNIA 
 
 
 
CRISTINA VASQUEZ, 
) 
 
) 
 
Plaintiff and Respondent, 
) 
 
 
) 
S143710 
 
v. 
) 
 
 
) 
Ct.App. 4/1 D045592 
STATE OF CALIFORNIA, 
) 
 
) 
San Diego County 
 
Defendant and Appellant. 
) 
Super. Ct. No. GIC 740832 
___________________________________ ) 
 
Under the so-called private attorney general statute (Code Civ. Proc., 
§ 1021.5, sometimes hereafter section 1021.5), a court may award attorney fees to 
the successful party in an action that has resulted in the enforcement of an 
important right affecting the public interest.  In Graham v. DaimlerChrysler Corp. 
(2004) 34 Cal.4th 553, 560 (Graham), we held the “catalyst theory” permits a 
court to award attorney fees under section 1021.5 “even when litigation does not 
result in a judicial resolution if the defendant changes its behavior substantially 
because of, and in the manner sought by, the litigation.”  In so holding, we also 
adopted “sensible limitations on the catalyst theory” (Graham, at p. 575) to 
discourage meritless suits motivated by the hope of fees, “without putting a 
damper on lawsuits that genuinely provide a public benefit” (ibid.).   
Today we revisit one of the “limitations on the catalyst theory” adopted in 
Graham, supra, 34 Cal.4th 553, 575 — specifically, the rule that the plaintiff in a 
“catalyst case,” to recover attorney fees under section 1021.5, “must have engaged 
 
 
2
in a reasonable attempt to settle its dispute with the defendant prior to litigation” 
(Graham, at p. 561).  While this is not a catalyst case (see post, at p. 19), 
defendant argues the rule just mentioned should apply whenever fees are sought 
under section 1021.5.  We hold that no such categorical rule applies in noncatalyst 
cases.  In all cases, however, section 1021.5 requires the court to determine that 
“the necessity and financial burden of private enforcement . . . are such as to make 
the award appropriate . . . .”  (Ibid., italics added.)  In making this determination, 
one that implicates the court’s equitable discretion concerning attorney fees, the 
court properly considers all circumstances bearing on the question whether private 
enforcement was necessary, including whether the party seeking fees attempted to 
resolve the matter before resorting to litigation.   
I. INTRODUCTION 
Defendant and appellant the State of California petitions for review of a 
decision affirming an order awarding attorneys’ fees under section 1021.5 to 
plaintiff and respondent Cristina Vasquez.     
Proposition 139, known as the Prison Inmate Labor Initiative of 1990 
(approved by voters, Gen. Elec. (Nov. 6, 1990), and codified as Pen. Code, 
§ 2717.1 et seq.), instructs the Secretary of the Department of Correction and 
Rehabilitation to establish joint venture programs with private employers within 
state prison facilities to employ inmates (id., § 2717.2; see id., § 5050).  The law 
provides, among other things, that inmates be paid wages “comparable to wages 
paid by the joint venture employer to non-inmate employees performing similar 
work for that employer” or wages “comparable to wages paid for work of a similar 
nature in the locality in which the work is to be performed.”  (Pen. Code, 
§ 2717.8.)  The law also requires the Secretary to deduct up to 80 percent of each 
inmate employee’s gross wages for taxes, room and board, restitution to the 
victims of crime, and support for the inmate’s family.  (Ibid.)   
 
 
3
In August 1999, inmates Charles Ervin and Shearwood Fleming, together 
with the Union of Needletrades, Industrial & Textile Employees, AFL-CIO 
(UNITE), filed a complaint stating various causes of arising out a joint venture 
between the State of California and CMT Blues to manufacture clothing at the 
Richard J. Donovan Correctional Facility in San Diego.  As subsequently 
amended, the complaint named as defendants CMT Blues, its manager Pierre 
Sleiman, and several corporations that resold CMT Blues’ products under their 
own names.  Plaintiffs alleged defendants had committed unfair business practices 
by failing to pay comparable wages (Pen. Code, § 2717.8) or minimum wages 
(Lab. Code, §§ 1197, 3351, subd. (e)), by directing inmates to remove and replace 
“Made in Honduras” labels with others reading “Made in the USA,” and by selling 
these garments to consumers throughout California.   
  In July 2000, a second amended complaint added Vasquez, the international 
vice-president of UNITE, as a plaintiff, and added as defendants the State of 
California and Noreen Blonien, assistant director of the Department of Corrections 
and Rehabilitation for joint venture programs (collectively hereafter the State).  
Vasquez, who asserted standing as a taxpayer to prevent the waste of state 
property (Code Civ. Proc., § 526a), alleged the State had failed to collect and 
disburse payments due from joint venture employers, including CMT Blues.  This 
failure had occurred, Vasquez alleged, because the State had permitted employers, 
in violation of Proposition 139, to require inmates to complete unpaid training 
periods of 30 to 60 days and to pay less than comparable wages.   
The State successfully demurred to Vasquez’s taxpayer cause of action.  
Vasquez appealed, and the Court of Appeal reversed.  (Vasquez v. State of 
California (2003) 105 Cal.App.4th 849.)  The court rejected the State’s argument 
that a taxpayer claim for waste lies only to prevent the unlawful expenditure of 
 
 
4
funds, and held that such a claim may also challenge the State’s failure to collect 
funds.  (Id., at pp. 854-856.)   
While Vasquez’s appeal was pending, the inmates’ claims against CMT 
Blues were certified as a class action and tried without a jury.  In August 2002, the 
court entered judgment for the plaintiff class, ordering CMT Blues to pay 
$841,188.44 in wages, liquidated damages, waiting time, penalties and interest.  
The court also awarded, based on the parties’ stipulation, attorney fees of 
$435,000 and costs of $65,000.   
The trial of Vasquez’s taxpayer claim commenced in January 2004.  The trial 
ended, however, when the parties agreed to a stipulated injunction, which the court 
approved on February 17, 2004, and later entered as a judgment.  The injunction 
requires the State to submit written progress reports to the court every 90 days, to 
obtain wage plans and duty statements from each joint venture employer, to 
comply with all applicable record-keeping requirements, to provide payroll data to 
plaintiff’s counsel, to identify comparable wages as required by Proposition 139, 
to require joint venture employers to notify inmates of their rights under 
Proposition 139 and the Labor Code, to establish wage-related grievance 
procedures for inmates, to require joint venture employers to post bonds to secure 
the payment of wages, to notify the court and plaintiff’s counsel of defaults in 
wage payments, and to take reasonable steps to collect overdue wages.  The court 
retained jurisdiction to enforce, modify and/or dissolve the injunction for a period 
of two years, subject to extension or termination for good cause, and also retained 
jurisdiction to award attorneys’ fees.   
Vasquez subsequently moved for attorney fees under section 1021.5.  On 
August 11, 2004, the court awarded $1,257,258.60, based on a lodestar amount of 
$967,122 and a multiplier of 1.3.  On October 28, 2004, the court entered 
judgment on the stipulated injunction and the award of attorney fees.   
 
 
5
On December 2, 2004, we filed our decision in Graham, supra, 34 Cal.4th 
553, holding that the plaintiff in a catalyst case, to recover attorney fees under 
section 1021.5, “must have engaged in a reasonable attempt to settle its dispute 
with the defendant prior to litigation” (Graham, at p. 561).   
On December 17, 2004, the State in this case appealed the award of attorney 
fees.  In its opening brief on appeal, the State argued Vasquez was not entitled to 
recover fees under section 1021.5 because, among other reasons, she had not 
engaged in a reasonable attempt to settle before resorting to litigation.  The Court 
of Appeal affirmed the fee award.  Concerning the State’s argument that Vasquez 
was required to have attempted to settle her claim, the court observed that Graham 
applied only to catalyst cases, that the instant case was not a catalyst case because 
Vasquez had obtained a stipulated injunction that was reduced to judgment, and 
that the State had in any event waived the argument by failing to raise it in the trial 
court and by failing sufficiently to develop the argument in its opening brief.   
The State petitioned for review of the judgment to the extent it awarded 
attorney fees.  We granted review and limited the issue to be briefed and argued as 
follows:  “Does the rule that, in order to receive attorney fees under Code of Civil 
Procedure section 1021.5, the plaintiff must first reasonably attempt to settle the 
matter short of litigation, apply to this case?  (See Graham[, supra,] 34 Cal.4th 
553, 557; Grimsley v. Board of Supervisors (1985) 169 Cal.App.3d 960, 966-
967.)”   
II. DISCUSSION 
Section 1021.5 authorizes a court to “award attorneys’ fees to a successful 
party . . . in any action which has resulted in the enforcement of an important right 
affecting the public interest . . . .”  The Legislature enacted the provision to codify 
the private attorney general doctrine previously developed by the courts.  
(Woodland Hills Residents Assn., Inc. v. City Council (1979) 23 Cal.3d 917, 933 
 
 
6
(Woodland Hills); cf. Serrano v. Priest (1977) 20 Cal.3d 25, 42-47 [approving the 
doctrine].)  The doctrine rests on the recognition that privately initiated lawsuits, 
while often essential to effectuate important public policies, will as a practical 
matter frequently be infeasible without some mechanism authorizing courts to 
award fees.  (Graham, supra, 34 Cal.4th 553, 565; see also Maria P. v. Riles 
(1987) 43 Cal.3d 1281, 1289.)  Accordingly, “ ‘the fundamental objective of the 
doctrine is to encourage suits enforcing important public policies by providing 
substantial attorney fees to successful litigants in such cases.’ ”  (Graham, at 
p. 565, quoting Maria P. v. Riles, supra, at p. 1289.)   
A court may award attorney fees under section 1021.5 only if the statute’s 
requirements are satisfied.  Thus, a court may award fees only to “a successful 
party” and only if the action has “resulted in the enforcement of an important right 
affecting the public interest . . . .”  (Ibid.)  Three additional conditions must also 
exist:  “(a) a significant benefit, whether pecuniary or nonpecuniary, has been 
conferred on the general public or a large class of persons, (b) the necessity and 
financial burden of private enforcement, or of enforcement by one public entity 
against another public entity, are such as to make the award appropriate, and 
(c) such fees should not in the interest of justice be paid out of the recovery, if 
any.”  Section 1021.5 codifies the  courts’ “traditional equitable discretion” 
concerning attorney fees (Woodland Hills, supra, 23 Cal.3d 917, 938), and within 
the statutory parameters courts retain considerable discretion.  “[T]he Legislature 
has assigned responsibility for awarding fees under section 1021.5 ‘not to 
automatons . . . , but to judges expected and instructed to exercise “discretion.” ’ ”  
(Graham, supra, 34 Cal.4th 553, 575, quoting Buckhannon Board & Care Home, 
Inc. v. West Virginia Dept. of Health and Human Resources (2001) 532 U.S. 598, 
640 (dis. opn. of Ginsburg, J.).)  In deciding whether to award fees, the court 
“must realistically assess the litigation and determine, from a practical perspective, 
 
 
7
whether or not the action served to vindicate an important right so as to justify an 
attorney fee award under a private attorney general theory.”  (Woodland Hills, at 
p. 938.)  A reviewing court “will uphold the trial court’s decision to award 
attorney fees under section 1021.5, unless the court has abused its discretion.”  
(Graham, at p. 578.)   
A. May a Court Award Attorney Fees Under Section 1021.5 Only If the 
Plaintiff Attempted to Settle Before Resorting to Litigation? 
The State argues a court may never award attorney fees under section 1021.5 
unless the plaintiff attempted to settle before resorting to litigation.  Neither the 
language of the statute nor the cases interpreting it impose such a categorical 
requirement.  In determining, however, whether “the necessity and financial 
burden of private enforcement . . . are such as to make the award appropriate” 
(§ 1021.5), a court properly takes into consideration whether the party seeking fees 
attempted to resolve the matter without litigation.   
In construing section 1021.5 we begin with its plain language, affording the 
words their ordinary and usual meaning, as the words the Legislature chose to 
enact are the most reliable indicator of its intent.  (See People v. Watson (2007) 42 
Cal.4th 822, 828.)  The statute’s relevant language provides the court may award 
attorney fees if, among other things, “the necessity and financial burden of private 
enforcement, or of enforcement by one public entity against another public entity, 
are such as to make the award appropriate . . . .”  (§ 1021.5, subd. (b), italics 
added.)  This language does not expressly or by necessary implication require that 
the plaintiff have attempted to settle the dispute; it requires, instead, only that the 
court determine that private enforcement was sufficiently necessary to justify the 
award.  To be sure, failed attempts to settle can help to demonstrate that litigation 
was necessary, but the absence of settlement attempts does not logically or 
necessarily demonstrate the contrary.  Depending on the circumstances of the case, 
 
 
8
attempts to settle may have been futile, exigent circumstances may have required 
immediate resort to judicial process, or prior efforts to call the problem to the 
defendant’s attention — perhaps by other parties or in other proceedings — may 
have been rebuffed.  The language of section 1021.5 is sufficiently flexible to 
permit courts to consider these and all other relevant circumstances in determining 
whether private enforcement was sufficiently necessary to justify awarding fees.1   
The State points to nothing in the legislative history of section 1021.5 that 
might support the categorical requirement of a prelitigation settlement demand.  
Moreover, the Legislature clearly knows how to require prelitigation demands 
unambiguously when that is what it wishes to do.  Many statutes illustrate the 
point.  For example, a plaintiff suing under the Consumers Legal Remedies Act 
(Civ. Code, § 1750 et seq.) must notify the defendant of the particular violations 
alleged and demand correction, repair, replacement, or other remedy at least 30 
days before commencing an action.  (Id., § 1782, subd. (a)(1)-(2).)  The plaintiff in 
an action based on a health care provider’s professional negligence must give the 
defendant at least 90 days’ prior notice before commencing an action.  (Code Civ. 
Proc., § 364, subd. (a).)  A private plaintiff under the Safe Drinking Water and 
Toxic Enforcement Act of 1986 (Health & Saf. Code, § 25249.5 et seq.) must give 
notice, more than 60 days before commencing an action, to the alleged violator 
and to the Attorney General and the district attorney, city attorney, or prosecutor 
in whose jurisdiction the violation occurred.  (Id., § 25249.7, subd. (d)(1).)  A 
plaintiff may not sue under the Tort Claims Act (Gov. Code, § 900 et seq.) unless 
he or she has first presented a written claim to the governing board of the 
                                              
1  
In determining whether enforcement was sufficiently necessary to justify 
fees, the court also considers “the necessity of private, as compared to public, 
enforcement . . . .” (Woodland Hills, supra, 23 Cal.3d 917, 941, italics added.)   
 
 
9
defendant public entity and the board has acted upon the claim or the claim has 
been deemed rejected.  (Id., § 945.4.)  The plaintiff in a derivative action against a 
corporation must allege with particularity his or her efforts to secure the desired 
relief from the board of directors, or the reasons for not making such efforts, and 
also allege that he or she has either informed the corporation or its board in writing 
of the facts underlying each cause of action or delivered a copy of the proposed 
complaint.  (Corp. Code, § 800, subd. (b)(2).)  Finally, the plaintiff in an action for 
libel in a newspaper or slander by radio broadcast may recover only special 
damages unless he or she first demands a correction.  (Civ. Code, § 48a, subd. 1.)   
Thus, section 1021.5 as written does not require prelitigation demands, even 
though the Legislature is familiar with the language that will create such a 
requirement and has used such language on many occasions.  Under these 
circumstances, our own views concerning the theoretical desirability or value of 
such a categorical requirement are beside the point.  In construing this, or any, 
statute, our office is simply to ascertain and declare what the statute contains, not 
to change its scope by reading into it language it does not contain or by reading 
out of it language it does.  We may not rewrite the statute to conform to an 
assumed intention that does not appear in its language.  (Doe v. City of Los 
Angeles (2007) 42 Cal.4th 531, 545.)   
We have not interpreted section 1021.5 as imposing a prelitigation settlement 
demand requirement in noncatalyst cases.  In Graham, supra, 34 Cal.4th 553, we 
did require prelitigation demands, but only in catalyst cases.  The question before 
us was the continuing viability of the catalyst theory, in other words, whether 
section 1021.5 permitted an award of attorney fees, as some courts had concluded, 
“even when litigation does not result in a judicial resolution if the defendant 
changes its behavior substantially because of, and in the manner sought by, the 
litigation.”  (Graham, at p. 560.)  We held the catalyst theory “should not be 
 
 
10
abolished but clarified.”  (Ibid.)  To award fees in catalyst cases, we reasoned, 
posed a greater risk of rewarding opportunistic litigation than to award fees in 
cases that end with court-ordered changes in the parties’ legal relationships, 
because a defendant’s voluntary decision to change its behavior necessarily raises 
the question whether the plaintiff’s legal work in fact caused the change and thus 
deserves to be rewarded with fees.  On the other hand, to have abolished the 
catalyst theory would have deterred attorneys from taking meritorious public 
interest litigation by permitting defendants, even after tenacious litigation, to avoid 
paying fees by providing relief voluntarily just before being ordered to do so by 
the court.  (Id., at pp. 574-575.)  To avoid subjecting public interest litigation to 
“this increased risk . . . without rewarding a significant number of extortionate 
lawsuits,” we “adopt[ed] sensible limitations on the catalyst theory that discourage 
the latter without putting a damper on lawsuits that genuinely provide a public 
benefit.”  (Id., at p. 575, italics added.)  We later summarized those limitations as 
follows:  “In order to obtain attorney fees without such a judicially recognized 
change in the legal relationship between the parties, a plaintiff must establish that 
(1) the lawsuit was a catalyst motivating the defendants to provide the primary 
relief sought; (2) that the lawsuit had merit and achieved its catalytic effect by 
threat of victory, not by dint of nuisance and threat of expense . . . ; and (3) that 
the plaintiffs reasonably attempted to settle the litigation prior to filing the 
lawsuit.”  (Tipton-Whittingham v. City of Los Angeles (2004) 34 Cal.4th 604, 608 
(Tipton-Whittingham).)   
That we intended to impose these limitations, including the prelitigation 
demand requirement, only in catalyst cases is clear from our discussion of the 
point in Graham, supra, 34 Cal.4th 553.  There we wrote:  “In addition to some 
scrutiny of the merits, we conclude that another limitation on the catalyst rule 
proposed by the Attorney General, appearing as amicus curiae, should be adopted 
 
 
11
by this court.  The Attorney General proposes that a plaintiff seeking attorney fees 
under a catalyst theory must first reasonably attempt to settle the matter short of 
litigation.  (See Grimsley v. Board of Supervisors[, supra,] 169 Cal.App.3d 960, 
966-967.)  We believe this requirement is fully consistent with the basic objectives 
behind section 1021.5 and with one of its explicit requirements — the ‘necessity 
. . . of private enforcement’ of the public interest.  Awarding attorney fees for 
litigation when those rights could have been vindicated by reasonable efforts short 
of litigation does not advance that objective and encourages lawsuits that are more 
opportunistic than authentically for the public good.  Lengthy prelitigation 
negotiations are not required, nor is it necessary that the settlement demand be 
made by counsel, but a plaintiff must at least notify the defendant of its grievances 
and proposed remedies and give the defendant the opportunity to meet its demands 
within a reasonable time.  (See, e.g., S.D. v. Faulkner[ (S.D.Ind. 1989)] 705 
F.Supp. [1361,] 1363 [letter notifying defendants of plaintiffs’ grievances, plus 
discussions over two-month period]; see also Garrison v. Board of Directors 
(1995) 36 Cal.App.4th 1670, 1676 [Pub. Resources Code, § 21177, subd. (b) 
requires California Environmental Quality Act litigants to inform agency of 
objections before litigation to give agency opportunity to respond].)  What 
constitutes a ‘reasonable’ time will depend on the context.”  (Graham, supra, 34 
Cal.4th 533, 577, italics added.)   
This passage from Graham, supra, 34 Cal.4th 553, does not hold or, given its 
context, even suggest that the plaintiff in a noncatalyst case must make a 
prelitigation settlement demand in order to preserve the right to recover fees under 
section 1021.5.  The question was not before us, and “ ‘[i]t is axiomatic that cases 
are not authority for propositions not considered.’ ”  (People v. Avila (2006) 38 
Cal.4th 491, 566, quoting People v. Ault (2004) 33 Cal.4th 1250, 1268, fn. 10.)   
 
 
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If we had in Graham, supra, 34 Cal.4th 553, described the prelitigation 
demand requirement in catalyst cases as compelled by the language of section 
1021.5, then the case for applying the same requirement to all fee awards under 
the statute would be stronger.  But in Graham we did no such thing.  Instead, we 
described the requirement as “fully consistent with the basic objectives behind 
section 1021.5 and with one of its explicit requirements — the ‘necessity . . . of 
private enforcement’ of the public interest.”  (Graham, at p. 577, italics added.)  
That a rule adopted by this court to guide the exercise of judicial discretion is 
consistent with a statute does not mean the rule is compelled by the statute.  As 
explained above, the language of section 1021.5 cannot fairly be read as requiring 
prelitigation demands.   
That we did not in Graham, supra, 34 Cal.4th 553, derive the catalyst-case 
demand requirement from the language of section 1021.5 is also clear from 
Graham’s companion case, Tipton-Whittingham, supra, 34 Cal.4th 604.  In 
Tipton-Whittingham, we held that plaintiffs seeking attorney fees under the 
California Fair Employment and Housing Act (Gov. Code, § 12900 et seq.; 
hereafter the FEHA) under the catalyst theory must have attempted to settle before 
resorting to litigation, even though the FEHA’s provision concerning attorney fees 
(id., § 12965, subd. (b)),2 in contrast to section 1021.5, contains no reference to 
“the necessity . . . of private enforcement” (Code Civ. Proc., § 1021.5).  Rather 
than deriving the demand requirement from the language of the FEHA (Gov. 
Code, § 12965, subd. (b)), which would have been impossible, we simply imposed 
                                              
2  
Government Code section 12965, subdivision (b), provides in relevant part:  
“In actions brought under this section, the court, in its discretion, may award to the 
prevailing party reasonable attorney’s fees and costs, including expert witness 
fees, except where the action is filed by a public agency or a public official, acting 
in an official capacity.”   
 
 
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the requirement “[f]or the reasons explained in . . . Graham” (Tipton-Whittingham, 
at p. 608), namely, that the catalyst theory entailed risks and benefits that, on 
balance, justified the adoption of “sensible limitations on the catalyst theory that 
discourage [extortionate suits] without putting a damper on lawsuits that genuinely 
provide a public benefit” (Graham, at p. 575, italics added).   
In the four years since we decided Graham, supra, 34 Cal.4th 553, no 
California court has applied Graham’s demand requirement in a noncatalyst case.  
In 2005, one federal district court relied on Graham by analogy to impose a 
prelitigation demand requirement on motions seeking attorney fees under the 
Americans with Disabilities Act (42 U.S.C. § 12101 et seq. (ADA); see id., 
§ 12205 [attorney fees]).  (Doran v. Del Taco, Inc. (C.D.Cal. 2005) 373 F.Supp.2d 
1028, 1031-1034 (Doran).)  But the district court’s decision was reversed for that 
reason.  The plaintiff in Doran, who had encountered barriers to his wheelchair in 
the defendant’s restaurants, sued under the ADA and then settled his claims in an 
agreement designating him as the prevailing party for purposes of attorney fees.3  
The district court, without noting that we had described the demand requirement 
as a “limitation on the catalyst rule” (Graham, at p.  577), misread Graham as 
“adopt[ing] the view that, to recover attorneys’ fees in a private attorney general 
case, a plaintiff must have engaged in a reasonable attempt to settle his or her 
dispute with the defendant before litigation.”  (Doran, supra, 373 F.Supp.2d 1028, 
                                              
3  
The federal courts have not awarded attorney fees under the catalyst theory 
since 2001, when the high court rejected that theory in Buckhannon Board & Care 
Home, Inc. v. West Virginia Dept. of Health and Human Resources, supra, 532 
U.S. 598, 605-606.  The court in Doran, supra, 373 F.Supp.2d 1028, relied on a 
Ninth Circuit decision holding that a settlement agreement, as a legally 
enforceable instrument, can serve as a proper basis for awarding fees under federal 
law even after Buckhannon.  (Barrios v. Cal. Interscholastic Federation (9th Cir. 
2002) 277 F.3d 1128, 1134, fn. 5, cited in Doran, at p. 1029.)   
 
 
14
1032.)  Purporting to adopt a similar rule as a matter of federal law under the 
ADA, the district court denied the plaintiff’s motion for fees.  (Doran, at pp. 1033-
1034.)  The Ninth Circuit reversed, holding that the district court had “denied fees 
by subjecting [the plaintiff] to a requirement not found in the ADA or the case 
law.”  (Doran v. Del Taco, Inc. (9th Cir. 2007) 237 F.Appx. 148, 149.)   
The State argues that a 1985 lower court decision, Grimsley v. Board of 
Supervisors, supra, 169 Cal.App.3d 960 (Grimsley), established the general rule 
that no plaintiff may ever recover fees under section 1021.5 without having 
attempted to settle before resorting to litigation, and that 19 years later in Graham 
we merely “applied the holding of Grimsley to catalyst cases.”  Nothing in 
Graham, supra, 34 Cal.4th 553, however, suggests we believed that a generally 
applicable demand requirement existed or that we were merely applying a 
generally applicable requirement to catalyst cases.  Instead, in announcing the 
demand requirement we described it as a “limitation on the catalyst rule.”  (Id., at 
p. 577, italics added; see also id., at p. 575 [“limitation[] on the catalyst theory”].)  
Nor did we discuss Grimsley in our opinion; we cited the case without comment in 
describing the Attorney General’s suggestion that we adopt a demand requirement 
in catalyst cases.  (Graham, at p. 577.)   
The plaintiff in Grimsley, supra, 169 Cal.App.3d 960, sought attorney fees 
under section 1021.5 after winning a judgment setting aside a county’s approval of 
a general plan and mandating compliance with certain statutory procedural 
requirements the county had neglected.  The trial court denied the motion for fees, 
reasoning that the plaintiff had won “ ‘on the narrowest grounds’ ” (Grimsley, at 
p. 965), had brought about no substantive change in the general plan, and had not 
enforced an important right affecting the public interest, as required by section 
1021.5 (ibid.).  On appeal, the reviewing court affirmed, emphasizing that trial 
courts’ decisions concerning fees under section 1021.5 are “discretionary” 
 
 
15
(Grimsley, at p. 965) and “ ‘may be guided by equitable principles’ ” (ibid., italics 
added).  Applying its equitable discretion to the facts of the case, the Court of 
Appeal concluded that “it [was] a near certainty that had Grimsley timely pointed 
out to an appropriate county official or agency, the respects in which [the relevant 
procedural statutes] had not been followed, appropriate corrective action would 
have been promptly forthcoming.”  (Id., at p. 966, italics added.)  The Grimsley 
court concluded its analysis by holding that “attorney fees under . . . section 
1021.5, will not be awarded unless the plaintiff seeking such fees had reasonably 
endeavored to enforce the ‘important right affecting the public interest,’ without 
litigation and its attendant expense.’ ”  (Ibid.)   
As we have explained, section 1021.5 does not require prelitigation 
settlement demands in noncatalyst cases.  To the extent Grimsley, supra, 169 
Cal.App.3d 960, might be read to interpret the statute differently, the decision 
would be incorrect.  No opinion published in the 19 years between Grimsley and 
Graham, supra, 34 Cal.4th 553, however, cites Grimsley as authority for denying 
a motion for attorney fees under section 1021.5 on the ground that the plaintiff 
failed to make a prelitigation settlement demand.  Only one decision published 
before Graham even cites Grimsley on this point, and the court in that case 
declined to rely on Grimsley as a basis for withholding fees.  (Phipps v. 
Saddleback Valley Unified School Dist. (1988) 204 Cal.App.3d 1110, 1123, fn. 9.)   
Grimsley, supra, 169 Cal.App.3d 960, does usefully illustrate the narrower 
principle that a court, in exercising its equitable discretion concerning attorney 
fees under section 1021.5, properly takes into consideration whether the party 
seeking fees attempted to resolve its dispute before resorting to litigation.  
Grimsley thus restates the statutory requirement that the party seeking fees under 
section 1021.5 must demonstrate that “the necessity and financial burden of 
private enforcement . . . are such as to make the award appropriate.”  (§ 1021.5, 
 
 
16
subd. (b).)  As the Grimsley court correctly observed, “ ‘courts may be guided by 
equitable principles when awarding attorney’s fees.’ ”  (Grimsley, at p. 965, 
quoting Harvard Investment Co. v. Gap Stores, Inc. (1984) 156 Cal.App.3d 704, 
717; see also Woodland Hills, supra, 23 Cal.3d 917, 938 [§ 1021.5 codifies courts’ 
traditional equitable discretion]; Graham, supra, 34 Cal.4th 553, 575 [judges are 
expected to exercise discretion under § 1021.5].)  While we did not in Graham, 
supra, 34 Cal.4th 553, go so far as to require prelitigation settlement demands in 
noncatalyst cases, we acknowledged the general principle that prelitigation efforts 
to resolve a dispute, or their absence, properly inform the court’s decision whether 
to award fees under section 1021.5.  As we explained, “[a]warding attorney fees 
for litigation when those rights could have been vindicated by reasonable efforts 
short of litigation does not advance [section 1021.5’s] objective and encourages 
lawsuits that are more opportunistic than authentically for the public good.”  
(Graham, at p. 577.)   
Other decisions also recognize that prelitigation efforts to resolve a dispute 
properly inform a court’s exercise of discretion under section 1021.5.  The court in 
Baxter v. Salutary Sportsclubs, Inc. (2004) 122 Cal.App.4th 941, for example, 
affirmed an order denying attorney fees to a plaintiff who had successfully sued a 
health club to require trivial changes in its membership contracts, both because the 
suit had conferred no benefit on the public (id., at p. 946) and because the 
litigation did not appear to have been necessary.  Concerning the suit’s necessity, 
the court found “no evidence that [the plaintiff had] notified [the defendant] of the 
deficiencies in its contracts, or demanded their correction, before filing this action.  
Since [the defendant] corrected those minor deficiencies shortly after the suit was 
filed, it appears the litigation and the consequent attorney fees were largely, if not 
entirely, unnecessary.”  (Id., at pp. 946-947, fns. omitted.)   
 
 
17
Similarly, the court in Schwartz v. City of Rosemead (1984) 155 Cal.App.3d 
547, affirmed an order denying the plaintiff’s motion for fees after the plaintiff 
successfully sued to require a city to conduct environmental review of a plan to 
construct a cogeneration plant on property adjacent to his own.  The court reached 
this conclusion both because the financial burden plaintiff undertook in suing was 
not out of proportion to his personal interest in the case (id., at p. 559), and also 
because the plaintiff had neglected his statutory duty to inform the Attorney 
General of the action within 10 days of its filing (id., at pp. 560-561; see Code 
Civ. Proc., § 388, and Gov. Code, § 21167.7).  While the relevant statutes did not 
make such notification a prerequisite to recovering fees, the plaintiff’s failure to 
give notice tended to show that private enforcement had not been necessary:  “If 
the Attorney General had been promptly notified of [the plaintiff’s] action and had 
decided to intervene, [the plaintiff] may not have been required to pursue his 
lawsuit to the extent he ultimately did.  The service of pleadings on the Attorney 
General has the effect of informing that office of the action and permits the 
Attorney General to lend its power, prestige, and resources to secure compliance 
with CEQA and other environmental laws, perhaps without the necessity of 
prolonged litigation.  If the Attorney General is properly served and elects not to 
intervene, then a plaintiff’s pursuit of a lawsuit becomes presumptively 
‘necessary.’ ”  (Schwartz v. City of Rosemead, supra, at p. 561.)   
The State argues that policy considerations weigh against adopting different 
rules for catalyst and noncatalyst cases.  The State suggests that a uniform demand 
requirement would encourage settlements, which the law generally favors (Folsom 
v. Butte County Assn. of Governments (1982) 32 Cal.3d 668, 677), and that 
different rules might create confusion for plaintiffs, who cannot know in advance 
whether any given case will settle and thus become a catalyst case subject to 
Graham, supra, 34 Cal.4th 553.  Our holding, however, neither discourages 
 
 
18
settlement nor creates confusion.  As we have explained, settlement efforts (or 
their absence) are relevant in every case to show that “the necessity and financial 
burden of private enforcement . . . are such as to make the award appropriate . . . .”  
(§ 1021.5, italics added.)  In assessing such information in a particular case to 
determine whether private enforcement was sufficiently necessary to justify an 
award of fees, the trial court exercises its equitable discretion in light of all the 
relevant circumstances.4  That a plaintiff for tactical reasons might choose not to 
propose, or not to accept, a reasonable settlement offer is thus, in every case, a 
circumstance that potentially weighs against an award of fees.  In Graham, we 
simply identified a set of cases at one end of the equitable spectrum that appeared 
to justify a bright-line rule because, in those cases, no court-ordered change in the 
parties’ legal relationship exists to show that the public benefit supposedly 
meriting fees was caused by the plaintiff’s litigation rather than by the defendant’s 
voluntary action.     
For all of these reasons, we answer in the negative the question on which we 
granted review:  No rule applicable to this case required plaintiff, in order to 
recover attorney fees under Code of Civil Procedure section 1021.5, first to 
attempt to settle the matter short of litigation.5   
                                              
4  
We presume the trial court, in exercising its discretion to award fees, was 
aware of the requirements of section 1021.5 and specifically of the requirement 
that “the necessity and financial burden of private enforcement . . . [be] such as to 
make the award appropriate.”  (Id., subd. (b).)  The State does not argue to the 
contrary, except to urge that section 1021.5 requires prelitigation settlement 
demands in every case.   
5  
Because section 1021.5 imposes no categorical settlement demand 
requirement, we need not consider whether any such requirement would admit an 
exception for futility.  However, the claim that settlement efforts would have been 
futile is logically relevant to a trial court’s determination of the question whether 
private enforcement was sufficiently necessary to justify an award of fees.   
 
 
19
B. This Is Not a Catalyst Case. 
The State argues in the alternative that we should treat this case as a catalyst 
case and, thus, hold that the prelitigation settlement demand requirement adopted 
for such cases in Graham, supra, 34 Cal.4th 553, 577, applies.  The argument 
lacks merit. 
While we did not in Graham, supra, 34 Cal.4th 553, expressly define 
“catalyst case,” a definition of the term is necessarily implicit both in Graham and 
in its companion case, Tipton-Whittingham, supra, 34 Cal.4th 604.  In Graham, 
we described “the catalyst theory” as permitting attorneys fees to be awarded 
“even when litigation does not result in a judicial resolution if the defendant 
changes its behavior substantially because of, and in the manner sought by, the 
litigation.”  (Graham, at p. 560, italics added.)  Similarly, in Tipton-Whittingham 
we held that Graham’s “limitations on the catalyst theory” (Graham, at p. 575) set 
out the factual prerequisites that a plaintiff must establish “[i]n order to obtain 
attorney fees without . . . a judicially recognized change in the legal relationship 
between the parties . . . .”  (Tipton-Whittingham, at p. 608, italics added.)6  
Accordingly, and of necessity, a plaintiff who has not succeeded in obtaining “a 
judicial resolution” (Graham, at p. 560) or “a judicially recognized change in the 
legal relationship between the parties” (Tipton-Whittingham, at p. 608) must 
obtain attorney fees under the catalyst theory, or not at all.   
This case is not a catalyst case because Vasquez successfully obtained a 
stipulated injunction that was entered as a judgment and thus brought about a 
                                              
6  
The quoted language from Tipton-Wittingham, supra, 34 Cal.4th 604, 608, 
derives indirectly from the high court’s definition of the term “prevailing party” in 
Buckhannon Board & Care Home, Inc. v. West Virginia Dept. of Health and 
Human Resources, supra, 532 U.S. 598, 604, 605.  (See Graham, supra, 34 
Cal.4th 553, 569-570.)   
 
 
20
judicially recognized change in the parties’ legal relationship.  (See Tipton-
Whittingham, supra, 34 Cal.4th 604, 608.)  As noted, the stipulated injunction 
imposes substantial continuing obligations on the State with respect to its joint 
venture programs with private employers.  (See ante, at p. 4.)  Cases decided since 
Tipton-Whittingham and Graham, supra, 34 Cal.4th 553, in which the plaintiffs 
have obtained injunctions or stipulated injunctions have not been treated as 
catalyst cases.  (County of Colusa v. California Wildlife Conservation Bd. (2006) 
145 Cal.App.4th 637, 657-658 [preliminary injunction and stay]; Lyons v. Chinese 
Hospital Assn. (2006) 136 Cal.App.4th 1331, 1341-1342, 1345-1348 [stipulated 
judgment and injunction].)  A stipulated injunction approved by a court and 
entered as a judgment is, in effect, a consent decree.  Even the federal courts, 
which reject the catalyst theory, recognize a consent decree as a sufficient basis for 
awarding attorney fees.  (Buckhannon Board & Care Home, Inc. v. West Virginia 
Dept. of Health and Human Resources, supra, 532 U.S. 598, 604; see also 
Graham, at p. 576, fn. 7.)   
The State, citing Westside Community for Independent Living, Inc. v. Obledo 
(1983) 33 Cal.3d 348, 352, contends that a catalyst case is simply one in which 
“ ‘relief is obtained through a “voluntary” change in the defendant’s conduct, 
through a settlement, or otherwise.’ ”  The State points to its voluntary conduct in 
agreeing to the stipulated injunction and in beginning, however slowly and 
incompletely, to implement the requirements of Proposition 139 before Vasquez 
became a party to the instant litigation.  We have, however,  never adopted the 
formula the State offers as the definition of a catalyst case.  In Westside 
Community, we held simply that a voluntary change by the defendant can justify 
an award of attorneys’ fees “where ‘plaintiffs’ lawsuit was a catalyst motivating 
defendants to provide the primary relief sought . . . .’ ”  (Id., at p. 353, quoting 
Robinson v. Kimbrough (5th Cir. 1981) 652 F.2d 458, 465.)  We quoted the same 
 
 
21
language in Graham, supra, 34 Cal.4th 553, 567, to make the same point.  In 
neither case, however, did we hold that a case in which the plaintiff has 
successfully obtained a judicially recognized change in the parties’ legal 
relationship must be treated as a catalyst case simply because the defendant took 
some voluntary step towards resolving the litigation.   
Accordingly, we agree with the Court of Appeal that this is not a catalyst 
case and that the “limitations on the catalyst theory” adopted in Graham, supra, 34 
Cal.4th 553, 575-577, do not properly apply here.   
III. DISPOSITION 
The judgment of the Court of Appeal is affirmed.   
  
 
 
 
WERDEGAR, J. 
WE CONCUR: 
 
GEORGE, C.J. 
KENNARD, J. 
BAXTER, J. 
CHIN, J. 
MORENO, J. 
CORRIGAN, J.
 
 
See next page for addresses and telephone numbers for counsel who argued in Supreme Court. 
 
Name of Opinion Vasquez v. State of California 
__________________________________________________________________________________ 
 
Unpublished Opinion 
Original Appeal 
Original Proceeding 
Review Granted XXX 138 Cal.App.4th 550 
Rehearing Granted 
 
__________________________________________________________________________________ 
 
Opinion No. S143710 
Date Filed: November 20, 2008 
__________________________________________________________________________________ 
 
Court: Superior 
County: San Diego 
Judge: William C. Pate 
 
__________________________________________________________________________________ 
 
Attorneys for Appellant: 
 
Archer Norris, Thomas S. Clifton, Colin C. Munro, Sonny T. Lee; Niddrie, Fish & Buchanan and Martin N. 
Buchanan for Defendant and Appellant. 
 
Jarvis, Fay, Doporto & Gibson, Jarvis, Fay & Doporto and Andrea J. Saltzman for League of California 
Cities and California State Association of Counties as Amici Curiae on behalf of Defendant and Appellant. 
 
Edmund G. Brown, Jr., Attorney General, Manuel M. Medeiros, State Solicitor General, Tom Greene, 
Chief Assistant Attorney General, Theodora Berger, Assistant Attorney General, and Edward G. Weil, 
Deputy Attorney General, as Amici Curiae on behalf of Defendant and Appellant. 
 
 
__________________________________________________________________________________ 
 
Attorneys for Respondent: 
 
Altshuler, Berzon, Nussbaum, Rubin & Demain, Altshuler Berzon, Michael Rubin, Katherine M. Pollock; 
Law Offices of Robert Berke, Robert Berke, Joseph A. Pertel; Law Offices of Robert S. Gerstein, Robert S. 
Gerstein; Law Offices of Janet Herold and Janet Herold for Plaintiff and Respondent. 
 
Deborah J. La Fetra for Pacific Legal Foundation as Amicus Curiae on behalf of Plaintiff and Respondent. 
 
The Impact Fund, Brad Seligman, Julia Campins; Litt, Estuar, Harrison & Kitson, Barret S. Litt and Paul J. 
Estuar as Amici Curiae on behalf of Plaintiff and Respondent. 
 
Richard Rothschild; Law Offices of Richard M. Pearl and Richard M. Pearl for Los Angeles County Bar 
Association as Amicus Curiae on behalf of Plaintiff and Respondent. 
 
 
 
 
 
 
 
 
Counsel who argued in Supreme Court (not intended for publication with opinion): 
 
Martin N. Buchanan 
Niddrie, Fish & Buchanan 
750 B Street, Suite 2640 
San Diego, CA  92101 
(619) 238-2426 
 
Robert Berke 
Law Offices of Robert Berke 
1717 Fourth Street, 3rd Floor 
Santa Monica, CA  90401 
(310) 917-5599