Wang v. Ehang Holdings Limited

Background

Gary Wang brought an employment action against EHang Holdings Limited, Guangzhou EHang Intelligent Technology Co., Ltd., Huazhi Hu, Derrick Yifang Xiong, Shang-Wen Hsiao, and Richard Jian Liu. He argued that the defendants promised him restricted share units of EHang Holdings stock as compensation but did not fulfill that promise when he resigned.

A jury found liability against EHang Holdings and EHang Intelligent for breach of contract; against EHang Holdings, EHang Intelligent, and Hu for false promise; and against EHang Holdings, EHang Intelligent, and Hu for failure to pay wages. The jury found no liability against Xiong, Hsiao, or Liu. Judgment was entered on April 28, 2022. Wang then sought attorneys’ fees, costs, and interest from EHang Holdings, EHang Intelligent, and Hu under the California Labor Code.

Attorneys’ Fees and Costs

Wang sought fees under California Labor Code § 218.5(a), which requires an award of reasonable attorneys’ fees and costs to the prevailing party in an action for nonpayment of wages when the request was made at the start of the action. The court found that Wang was the prevailing party on his unpaid-wages claim and that his original complaint requested fees and costs. The defendants did not dispute his entitlement to reasonable fees and costs, but challenged the amount.

The court approved Wang’s requested costs of $7,766.75. Wang had calculated a lodestar—the starting fee figure based on reasonable hours multiplied by reasonable hourly rates—of $260,941.50, and sought a multiplier of 2 for a total fee award of $521,883. The court found the hours and billing rates reasonable and accepted the $260,941.50 lodestar.

The court concluded that the ordinary nature of Wang’s claims and the lack of evidence that his counsel had been unable to take other work did not support an enhancement. Counsel’s skill and the contingent portion of the fee arrangement weighed slightly in favor of an enhancement. The court therefore applied a multiplier of 1.2, rather than the requested multiplier of 2, and awarded $313,129.80 in attorneys’ fees.

Interest

Wang sought 10% annual interest on the $3.5 million compensatory-damages award, beginning July 1, 2021. California Labor Code § 218.6 requires interest on due and unpaid wages at the rate specified by California Civil Code § 3289(b), which the court identified as 10% per year. The jury had determined that July 1, 2021, was the date on which interest began to accrue.

Ruling

Judge Beth Labson Freeman granted in part and denied in part Wang’s motion for attorneys’ fees, costs, and interest against EHang Holdings, EHang Intelligent, and Hu. The court awarded $313,129.80 in reasonable attorneys’ fees, $7,766.75 in reasonable costs, and 10% annual interest on the $3.5 million compensatory-damages award from July 1, 2021, until the principal was paid in full. The order terminated ECF 208.