Court dismisses $800,000 overbilling cross-complaint against Dykema

Orange County Superior Court Judge Gassia Apkarian dismissed a cross-complaint Tuesday accusing Dykema Gossett LLP of overbilling a corporate client by more than $800,000, ruling the claims were barred by the one-year statute of limitations governing attorney misconduct.

The ruling underscores the broad reach of California's attorney-malpractice statute in fee disputes, holding that claims based on allegedly excessive legal fees accrue when clients discover the underlying facts, not when they later develop a legal theory or calculate damages. Dykema Gossett LLP v. SCSA Group, Inc., 30-2025-01514761-CU-CL-CJC, (O.C. Super. Ct., filed Sept. 25, 2025)

Dykema attorney Lucy Mekhael, of the Encino firm Hemar, Rousso & Heald LLP, said her client declined to comment. Christian L. Peirano, counsel for South Coast Safe Access Cannabis Dispensary Group Inc. and co-founder David Dewyke, did not respond to requests for comment.

Dykema originally sued to recover an unpaid balance of $297,163.84. The clients responded with a cross-complaint alleging the firm billed more than $800,000 between 2019 and 2021 for what they characterized as a limited appellate engagement. They alleged duplicate billing, vague time entries, undisclosed staffing, work outside the agreed scope and inaccurate accounting of payments.

Apkarian sustained Dykema's demurrer without leave to amend, finding SCSA Group and Dewyke knew or should have known of the alleged billing issues by 2021 but did not assert their claims until 2025.

In their brief, SCSA and Dewyke argued that the dispute concerned the firm's billing and disclosure practices rather than legal malpractice. They wrote: "The Cross-Complainants do not allege deficient legal advice, advocacy, or work product. The claims asserted herein do not depend on proof of professional negligence or violations of a legal standard of care, but instead arise from billing practices, failure to disclose staffing and rates, failure to credit payments, statutory noncompliance, and retention of fees beyond the reasonable value of services."

Apkarian rejected that argument, finding the claims remained subject to Code of Civil Procedure Section 340.6. Citing Lee v. Hanley, the court said the statute applies to claims requiring proof that an attorney violated a professional obligation, including excessive-fee and billing disputes. Lee v. Hanley (2014) 227 Cal.App.4th 1295

The court found the clients' own allegations established the limitations defense. Their original pleading alleged Dykema represented them through approximately July 2021, giving them until July 2022 under the one-year limitations period and until July 2025 under Section 340.6's four-year outside limit. The cross-complaint, filed in September 2025, was untimely under either measure.

Apkarian also applied California's sham pleading doctrine, noting the amended complaint omitted earlier allegations regarding tolling and the end of Dykema's representation without explanation. Citing Deveny v. Entropin Inc., the court held plaintiffs cannot avoid dismissal by removing damaging allegations from prior pleadings. Deveny v. Entropin, Inc., 139 Cal. App. 4th 408, 42 Cal. Rptr. 3d 807 (Cal. Ct. App. 2006)