United States v. 2012-04-05 | 10-56455 | Robert Valenzuela V. Adt Security Services, Inc. |…

This disposition is not appropriate for publication and is not precedent*
except as provided by 9th Cir. R. 36-3.
The Honorable Robert W. Pratt, District Judge for the U.S. District **
Court for Southern Iowa, sitting by designation.
NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
ROBERTO VALENZUELA, an
individual; RUBY VALENZUELA, an
individual; and PEARL OF THE ORIENT,
INC., a California corporation d/b/a
MANILA FINE JEWELERS,
Plaintiffs - Appellants
and Cross-Appellees,
v.
ADT SECURITY SERVICES, INC.,
Defendant - Appellee
and Cross-Appellant.
No. 10-56455 and 10-56517
D.C. No. 2:09-cv-02075-DMG-
FFM
MEMORANDUM*
Appeal from the United States District Court
for the Central District of California
Dolly M. Gee, District Judge, Presiding
Argued and Submitted February 16, 2012
Pasadena, California
Before: PREGERSON and BEA, Circuit Judges, and PRATT, District Judge. **
FILED
APR 05 2012
MOLLY C. DWYER, CLERK
U .S. C OU R T OF APPE ALS

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Plaintiffs-Appellants Roberto and Ruby Valenzuela and Pearl of the Orient,
Inc. d/b/a Manila Fine Jewelers (collectively “Valenzuela”) appeal from the
following district court orders: 1) the grant of summary judgment in favor of
Defendant-Appellee ADT Security Services, Inc. (“ADT”) on Valenzuela’s claim
of gross negligence; 2) the decision to enforce a limited damages provision after
granting summary judgment in favor of Valenzuela on a breach of contract claim;
and 3) the refusal to award attorneys’ fees in favor of Valenzuela. ADT cross-
appeals the district court’s refusal to award attorneys’ fees in its favor. We have
jurisdiction pursuant to 28 U.S.C § 1291. We review de novo the district court’s
legal determinations. Balint v. Carson City, 180 F.3d 1047, 1050 (9th Cir. 1999)
(en banc). We review the district court’s decision to award or deny attorneys’ fees
for abuse of discretion. Drucker v. O’Brien’s Moving & Storage, Inc., 963 F.2d
1171, 1173 (9th Cir. 1992).
The district court properly granted summary judgment in favor of ADT on
Valenzuela’s gross negligence claim. Although ADT failed properly to install
Valenzuela’s alarm system and failed to provide notification services when it
actually received an alarm signal from the system, ADT’s legal obligation to
provide either service arose solely from its contractual relationship with
Valenzuela, not from any duty independent of the parties’ contract. See Ehrlich v.

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Menezes, 21 Cal. 4th 543, 558 (1999) (“[C]onduct amounting to a breach of
contract becomes tortious only when it also violates a duty independent of the
contract arising from principles of tort law.”); Better Food Mkts., Inc. v. Am. Dist.
Tel. Co., 40 Cal. 2d 179, 187-88 (1953) (limiting a plaintiff to contractual remedies
where a defendant alarm company failed timely to report alarm activations to law
enforcement).
The district court properly limited Valenzuela’s damages for breach of
contract to $1,000. In California, liquidated damages provisions in commercial
contracts are presumed valid “unless the party seeking to invalidate the provision
establishes that the provision was unreasonable under the circumstances existing at
the time the contract was made.” Cal. Civ. Code § 1671(b). Valenzuela has not
identified any circumstances that existed at the time of contract formation that
would support a conclusion that the liquidated damages provision was
unreasonable. Moreover, California courts routinely uphold such provisions in
cases such as this one. E.g., Better Food Mkts., Inc., 40 Cal. 2d at 187; Atkinson v.
Pac. Fire Extinguisher Co., 40 Cal. 2d 192, 196–97 (1953); Guthrie v. Am.
Protection Indus., 160 Cal. App. 3d 951, 953 (1984); Feary v. Aaron Burglar
Alarm Inc., 32 Cal. App. 3d 553, 558 (1973).

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Valenzuela maintained at all times an entitlement to over $821,000 in1
damages. ADT maintained at all times that Valenzuela’s breach of contract claim
was barred, or if not, that Valenzuela was limited to $1,000 damages.
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The district court properly denied Valenzuela’s request for attorneys’ fees.
Although Valenzuela was successful in obtaining a breach of contract judgment
against ADT, “prevailing party” status for purposes of an attorneys’ fee award
under California Civil Code § 1717 is measured by “compar[ing] the relief
awarded on the contract claim or claims with the parties’ demands on those same
claims and their litigation objectives as disclosed by the pleadings . . . and similar
sources.” Hsu v. Abbara, 9 Cal. 4th 863, 876–77 (1995). Valenzuela succeeded in
obtaining only a minute portion of its claimed damages. It was well within the trial
court’s discretion to decline Valenzuela prevailing party status in such
circumstances. See Berkla v. Corel Corp., 302 F.3d 909, 922 (9th Cir. 2002).
Finally, the district court properly denied ADT’s request for attorneys’ fees.
Certainly, when comparing simple monetary results, ADT was ostensibly more
successful in achieving its litigation goals than was Valenzuela. A determination1
of prevailing party status, however, does not turn on mere monetary results; rather,
it requires evaluation of overall litigation success. See Hsu, 9 Cal. 4th at 876–77.
To that end, we find it was not an abuse of discretion for the district court to
decline ADT prevailing party status where ADT actively sought to avoid both the

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entry of judgment and the entry of $1,000 damages against it on Valenzuela’s
breach of contract claim.
The district court’s determinations on all of the foregoing issues is,
therefore, AFFIRMED.

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