Tamer Salameh v. 5th Rock LLC

MEMORANDUM

Plaintiffs appeal from an award of $405,371.25 in attorney’s fees to defendants. The district court did not abuse its discretion in granting the award.

The plaintiffs’ general objections to the awarding of fees under the purchase contract lack merit. In the appeal from their lawsuit’s dismissal, we held that the interests they purchased were not securities. Salameh v. Tarsadia Hotel, 726 F.3d 1124, 1129-32 (9th Cir. 2013). That decision forecloses their argument here that the purchase contract is illegal and hence unenforceable for failing to comply with securities laws. Their alternative argument that the contract’s fees provision does not cover the fraud causes of action also fails. The provision permits fees in any legal action “arising out of this Contract,” and this language is broad enough to encompass tort claims based on the contract’s underlying transaction. See, e.g., Santisas v. Goodin, 17 Cal.4th 599 , 71 Cal.Rptr.2d 830 , 951 P.2d 399, 405 (1998). The fees provision is therefore enforceable and applicable to the fraud causes of action.

As for the reasonableness of the fees award, the district court was not required to further apportion the fees between…