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Brian D'AMATO; Paul D'Amato, as partners of Sisbro I, Sisbro II, and Sisbro III, Plaintiffs-Appellants, v. Regina LILLIE; Gerald Lille, as partners of Sisbro I, Sisbro II, and Sisbro HI, Defendants-Appellees. Brian D'Amato; Paul D'Amato, as partners of Sisbro I, Sisbro II, and Sisbro III, Plaintiffs-Appellees,

view civil jury instructions for abuse of discretion, but we review de novo the question whether the legal requirements underlying the jury instruction were satisfied. Voohries-Larson v. Cessna Aircraft Co., 241 F.3d 707, 713 (9th Cir. 2001). We also review questions of state law de novo. Ortiz v. Bank of Am. Nat'l Trust Sau. Ass'n, 852 F.2d 383, 386 (9th Cir. 1987).

The D'Amatos next argue that the district court erred in refusing to instruct the jury on the fiduciary duties of general partners. Any error in failing to give this instruction was harmless. The jury found that the Agreements were breached, and the D'Amatos acknowledged in the district court that their damages would have been exactly the same under a breach of fiduciary duties theory.

The D'Amatos also argue that the district court erred in dismissing part of their breach of contract claims as timebarred. Specifically, the D'Amatos argue that the district court should have tolled the statute of limitations under the discovery rule. Under the discovery rule, "the cause of action accrues when the plaintiff discovers, or in the reasonable exercise of diligence should discover, the elements of the cause of action." 1000 Va. Ltd. P'ship v. Vertecs Corp., 158 Wash.2d 566, 146 P.3d 423, 428 (2006) (en banc). The district court properly applied the mailbox rule in presuming that the D'Amatos received partnership financial statements mailed by the Lillies, see Olson v. The Bon, Inc., 144 Wash.App. 627, 183 P.3d 359, 363 (2008), and did not clearly err in concluding that those statements were sufficient to put a reasonable person on notice that the Lillies were paying themselves salaries exceeding those authorized by the Agreements.

We review de novo the district court's dismissal of claims on statute of limitations grounds. Lukovsky v. City County of San Francisco, 535 F.3d 1044, 1047 (9th Cir. 2008). However, where "the accrual of the statute of limitations in part turns on what a reasonable person should have known, we review this mixed question of law and fact for clear error." Rose v. United States, 905 F.2d 1257, 1259 (9th Cir. 1990).

Accordingly, we affirm the judgment in No. 08-35888, and we dismiss the Lillies' crossappeal in No. 08-35980 as moot.

No. 09-35966

The D'Amatos also challenge the district court's order designating the Lillies the prevailing party and awarding them attorneys' fees and costs related to the defense of the limited partnership SISBRO III, which is organized in Idaho.

We review for abuse of discretion the district court's award of attorneys' fees under state law, although we review the district court's interpretation and application of the relevant state statute de novo. Kona Enters., Inc. v. Estate of Bishop, 229 F.3d 877, 883 (9th Cir. 2000). We review underlying factual determinations for clear error. Fischel v. Equitable Life Assur. Soc'y of U.S., 307 F.3d 997, 1005 (9th Cir. 2002).

The district court did not abuse its discretion under Idaho law in designating the Lillies the prevailing party, despite the jury's verdict that the Lillies breached the SISBRO III Agreement. In a similar situation, the Idaho Supreme Court upheld a trial court's determination that the defendant was the prevailing party where the verdict was in favor of the plaintiff, but the plaintiff was awarded only nominal damages, rather than the $250, 000 plus damages sought. See Odziemek v. Wesely, 102 Idaho 582, 634 P.2d 623, 623-24 (1981). Here, not only were the D'Amatos awarded no net damages, but the district court also dismissed many of their claims.

The D'Amatos also challenge the district court's decision to award attorneys' fees for work benefitting the defense of all three limited partnerships, rather than awarding only those fees that were accrued solely for the defense of claims relating to SISBRO III. The district court's method of calculating the amount of the attorneys' fees award was proper. "The calculation of the amount of the award of attorney fees is committed to the sound discretion of the district court." Mihalka v. Shepherd, 145 Idaho 547, 181 P.3d 473, 479 (2008). Idaho Rule of Civil Procedure 54(e)(3) instructs trial courts to consider eleven specific factors in determining the amount of an award of attorneys' fees, plus "[a]ny other factor which the court deems appropriate in the particular case." Idaho R. Ciu. Pro 54(e)(3)(1). Rule 54(e)(3) does not require that an award of attorneys' fees be narrowly limited to work implicating only matters of Idaho law, and neither the D'Amatos nor we have identified any Idaho case imposing such a limitation on the trial court's discretion. Nor did the district court err in considering that some work done for SISBRO I and SISBRO II fairly benefitted SISBRO III, as an additional "appropriate" factor under Rule 54(e)(3)(1). The district court's conclusion that much of the work of the LiUies' attorneys benefitted the defense of either all three partnerships or SISBRO III in particular was not clearly erroneous. Thus, in principle, the district court did not err in determining what portion of the LiUies' attorneys' fees to award.

The district court's order, however, does not clearly state the amount of the award. The district court indicated that the LiUies requested $288, 488.85 in attorneys' fees. ER921. The district court first stated that "[d]efense attorney fees in the sum of $215, 933.33 shall be taxed as costs." ER920. The order later stated, however, that it would be "reasonable to reduce the claimed hours by fifty percent in order to award reasonable attorney fees spent to defend claims relating to SISBRO III," ER923 which would suggest an award of $144, 244.43. Nonetheless, in the following paragraph, the district court awarded $215, 963.40, which it indicated reflected the elimination of one specific disputed fee, plus a twenty-five percent reduction of the resulting total. ER924 n. 2. Then, in the order's conclusion, the court ordered, without further explanation, that the "Clerk of Court shall tax $161, 950.00 in defense fees as costs." ER924.

Neither we nor the parties are able to discern the amount of the Lillies' attorneys' fees award from the district court's order. Accordingly, we vacate the attorneys' fee award and remand to the district court to clarify the amount of the LiUies' attorneys' fees to be taxed against the D'Amatos as costs, as well as its reasoning for arriving at that amount.

The judgment in No. 08-35888 is AFFIRMED. The order in No. 09-35966 is VACATED and REMANDED to the district court with instructions. No. 08-35980 is DISMISSED.

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D'AMATO v. LILLIE
(Oct 28, 2010)