NRCP 68 Fee Awards Must Exclude Pre-Offer Contingency Work Under Clark v. Marin

1. Introduction

Parties: Louis Bellomo and his employer, SHAC, LLC (a/k/a Sapphire LV Gentleman’s Club) (collectively, “Appellants”), versus Thunder Roybal (“Respondent”).
Case posture: Appeal from a negligence judgment on a jury verdict, denial of a new trial motion, and an order awarding attorney fees/costs/interest.
Core facts: Bellomo struck Roybal, who was riding a bicycle in a left turn lane, then attempted to flee but was stopped by witnesses. Roybal suffered significant neck/shoulder/spine injuries requiring multiple surgeries. Bellomo was driving for SHAC at the time.

Key issues on appeal:

  • Whether the $14,126,607.74 jury verdict was excessive and warranted a new trial under NRCP 59.
  • Whether attorney fees were properly awarded under NRCP 68 (validity of the offer of judgment; Beattie/Brunzell analysis).
  • On rehearing: whether awarding the full contingency fee was reasonable where the fee award included pre-offer work, in light of the intervening precedent Clark v. Marin.

2. Summary of the Opinion

The Nevada Supreme Court affirmed the judgment and the district court’s denial of a new trial, holding the damages were supported by substantial evidence and not the product of passion or prejudice. It also upheld the validity of Roybal’s NRCP 68 offer of judgment and the district court’s determinations under the Beattie v. Thomas factors regarding the offer’s reasonableness and the bad-faith rejection.

However, applying its recent decision in Clark v. Marin, the Court reversed the attorney-fee award and remanded because the district court’s reasonableness finding relied on the “totality” of counsel’s work (both pre- and post-offer), whereas Clark requires excluding pre-offer work when determining a reasonable NRCP 68 fee award.

3. Analysis

A. Precedents Cited

1) New-trial standards and “excessive damages” (NRCP 59)

  • BMW v. Roth and Lioce v. Cohen: The Court framed the review standard—new trial rulings are discretionary, but “deference is not owed to legal error” (with AA Primo Builders, LLC v. Washington supplying that principle through quotation in BMW).
  • Quigley v. Cent. Pac. R.R. Co.: Anchored the NRCP 59(a)(1)(F) concept that excessive damages warrant a new trial when influenced by “passion or prejudice.”
  • Brownfield v. F. W. Woolworth Co., Miller v. Schnitzer, and Wyeth v. Rowatt: These cases collectively drove the Court’s rejection of “objective criteria” (such as comparable verdicts) to evaluate pain-and-suffering awards. Brownfield emphasized the subjectivity of pain and suffering; Miller noted the doubtful value of comparisons (later “abrogated on other grounds” by Ace Truck & Equip. Rentals, Inc. v. Kahn); and Wyeth stated that considering comparable verdicts for compensatory damages would be an abuse of discretion.
  • Cox v. Copperfield: Supported the requirement that even if error is shown, the movant must establish prejudice—i.e., that a different result would have been reached.

2) Attorney misconduct and evidentiary/argument limits

  • Lioce v. Cohen (again): Supplied the review approach for alleged attorney misconduct (de novo with deference to factual findings and application of standards).
  • Old Aztec Mine, Inc. v. Brown: Enforced waiver where the appellate argument did not match the argument made below regarding excluded evidence.
  • Wickliffe v. Sunrise Hosp., Inc.: Justified limiting closing argument to inferences supported by trial evidence; the Court approved the district court’s view that appellants’ proposed argument would have misstated the expert’s testimony and would have required their own expert (which they did not present).

3) NRCP 68 offers of judgment: validity, interpretation, and fee-shifting

  • Frantz v. Johnson: Set abuse-of-discretion review for fee awards.
  • Barney v. Mt. Rose Heating & Air Conditioning and Galardi v. Naples Polaris, LLC: Distinguished de novo review for statutory/contract interpretation issues. Galardi was also used to define ambiguity—reasonable alternative interpretations.
  • Fleischer v. August (quoting Boorstein v. City of New York): Characterized NRCP 68 offers as “likened to contract offers,” importing contract definiteness principles.
  • Stockton Kenworth, Inc. v. Mentzer Detroit Diesel, Inc.: Provided the policy reason for definiteness—clarity so parties know what is required for “peace.”
  • Mohr Park Manor, Inc. v. Mohr: Supported using surrounding circumstances to determine intent when interpreting an offer/contract.

4) Beattie/Brunzell reasonableness framework and the Clark/Copriati shift

  • Beattie v. Thomas: Required the four-factor test governing whether and how to award fees under NRCP 68.
  • Yamaha Motor Co., U.S.A. v. Arnoult: Reinforced that district courts must evaluate Beattie factors when awarding fees under NRCP 68.
  • Brunzell v. Golden Gate National Bank: Provided the attorney-fee reasonableness factors (the Court emphasized factors (2) and (3) concerning the character of work and the work actually performed).
  • Capriati Construction Corp. v. Yahyavi, overruled by, Clark v. Marin: This was the doctrinal pivot. The district court relied on Capriati to award the full contingency fee under NRCP 68 if Beattie and Brunzell were satisfied. But Clark overruled that approach “insofar as it held that contingency fees are incurred upon judgment,” and required that “district courts must exclude the work done before the offer in considering a reasonable attorney fee award under NRCP 68.”

B. Legal Reasoning

1) Excessive damages: no “objective criteria” requirement and no passion/prejudice showing

The Court treated the excessive-verdict challenge as a classic NRCP 59(a)(1)(F) inquiry: did excessive damages appear to have been awarded under passion or prejudice, and did the moving party demonstrate prejudice? The Court approved the district court’s choice to analyze the issue through NRCP 59’s enumerated conditions rather than by comparing verdicts to “objective criteria.”

Consistent with Brownfield, Miller, and especially Wyeth, the Court reasoned that pain-and-suffering damages are inherently subjective and that reliance on comparable verdicts is not a required check—and may be an abuse of discretion. The verdict was left undisturbed because substantial evidence supported it and the record did not show errors that would likely inflame the jury.

2) Closing argument “discount” rhetoric: not burden-shifting misconduct

Appellants’ theory at trial emphasized comparative fault. Against that backdrop, Roybal’s repeated “discount” phrasing was interpreted as advocacy rebutting comparative-fault allocation, not as a legal instruction shifting the burden of proving damages to defendants. Even assuming error, the Court found no showing of outcome-changing prejudice as required by Cox v. Copperfield.

3) Claimed inability to rebut “misleading testimony”: waiver and proper control of closing inferences

The Court applied Old Aztec Mine, Inc. v. Brown to find waiver where appellants changed theories on appeal (from exclusion of the disability-application evidence to exclusion of ex-wife testimony). On the medical-risk/surgery point, the Court relied on Wickliffe v. Sunrise Hosp., Inc. to uphold the trial court’s decision to bar an argument that would misstate expert testimony and lacked evidentiary support absent appellants’ own expert.

4) NRCP 68 offer validity: “defendants” language was not ambiguous in context

Although the offer was addressed to Bellomo and then referenced “[d]efendants,” the Court treated the NRCP 68 offer like a contract under Fleischer v. August and Stockton Kenworth, Inc. v. Mentzer Detroit Diesel, Inc., and used surrounding circumstances per Mohr Park Manor, Inc. v. Mohr. The fact that the offer was sent to both defendants, referenced both, and the defendants shared counsel and conceded a “unity of interest” made the “only reasonable reading” that it applied to both. Under Galardi v. Naples Polaris, LLC, that eliminated ambiguity.

5) Fee entitlement vs. fee amount: affirming Beattie (timing/amount and bad-faith rejection), reversing on Clark’s pre-offer exclusion rule

The Court separated (a) whether NRCP 68 fee-shifting was warranted and (b) whether the fee amount was reasonable. It affirmed the district court’s findings that the offer was reasonable in timing and amount and that rejection was in bad faith (the second and third Beattie v. Thomas factors), citing the evidentiary basis: disclosed future treatment needs, inclusion of medical expenses/fees, and being within policy limits.

But on the fourth Beattie factor—reasonableness of the amount—Nevada’s law changed between the original affirmance and rehearing. The district court had relied on Capriati Construction Corp. v. Yahyavi to award a contingency fee that, in effect, treated the full contingency as “incurred upon judgment.” Clark v. Marin rejected that approach and mandated that pre-offer work be excluded when calculating a reasonable NRCP 68 fee award. Because the district court’s calculation rested on the “totality” of work (pre- and post-offer), it necessarily conflicted with Clark, requiring reversal and remand to recalculate consistent with the new controlling rule.

C. Impact

  • Operational rule for trial courts: After Clark v. Marin (as applied here), NRCP 68 attorney-fee awards must be recalculated to exclude pre-offer attorney work, even where the prevailing party’s counsel is retained on contingency and even if Beattie and Brunzell otherwise support a substantial fee.
  • Litigation strategy implications:
    • Offerors may structure billing/time records to cleanly separate pre- and post-offer work to support the remand calculation.
    • Offerees gain a narrower exposure window for fee-shifting (post-offer only), which may affect settlement leverage and timing.
    • Contingency-fee plaintiffs can no longer assume that a successful NRCP 68 posture will convert the entire contingency into a fee award; the fee must track post-offer work and reasonableness.
  • Damages review remains highly deferential: The opinion reaffirms Nevada’s skepticism toward “comparable verdict” analysis for pain-and-suffering awards and signals that large verdicts will not be disturbed absent a concrete record of passion/prejudice or prejudicial legal error.

4. Complex Concepts Simplified

  • NRCP 59(a)(1)(F) (“excessive damages”): A losing party can seek a new trial if the amount of damages appears inflated because the jury was driven by emotion (passion) or bias (prejudice), not by the evidence.
  • Comparative fault: A defense arguing the plaintiff shares responsibility, so damages should be reduced proportionally. Roybal’s “discount” rhetoric was treated as a rebuttal to this reduction theory.
  • NRCP 68 offer of judgment: A settlement mechanism with fee-shifting consequences. If an offeree rejects a qualifying offer and does worse at trial, the court may award certain post-offer litigation costs/fees to the offeror, subject to the Beattie factors.
  • Beattie factors vs. Brunzell factors:
    • Beattie v. Thomas asks whether it is fair to shift fees under NRCP 68 (good faith, reasonableness of offer, reasonableness/bad faith of rejection, and whether fees are reasonable in amount).
    • Brunzell v. Golden Gate National Bank helps determine whether the fee amount is reasonable (difficulty/importance of work; work actually performed; and other factors referenced in the full test).
  • Contingency fee and “incurred” fees (post-Clark): A contingency fee is usually a percentage of recovery. Clark v. Marin limits what can be shifted under NRCP 68 by requiring courts to ignore (exclude) work performed before the offer when setting a reasonable fee award.

5. Conclusion

Key takeaways: (1) Nevada courts generally will not use comparable verdicts or other “objective criteria” to second-guess large pain-and-suffering awards, and substantial-evidence verdicts will stand absent a showing of passion/prejudice and prejudicial error. (2) NRCP 68 offers are interpreted using contract principles and surrounding circumstances; minor drafting imperfections will not invalidate an offer if only one reasonable reading exists. (3) Most importantly, this decision operationalizes Clark v. Marin: when awarding attorney fees under NRCP 68, district courts must exclude pre-offer work—making fee reasonableness turn on post-offer work and its justification under Beattie and Brunzell.