On April 30, 2015, plaintiffs Marcus Hall and Dean Morehous, attorneys employed as “non-equity” partners for the law firm of Novak Druce Connolly Bove + Quigg, LLP, each received a change in compensation letter. Hall began work for Novak Druce Connolly Bove + Quigg in March 2013 and Morehous began working for the firm a month later. Every year they were issued letters setting forth what their salary would be for the following year. In February 2015, Hall and Morehous each received a letter setting forth their annual salary, plus a bonus to be paid midway through the year for their respective performances from the prior year. Specifically, the 2015 compensation letters stated that their compensation was to be paid in monthly installments at the end of each month. In addition, portions of their salaries during each calendar year were held back by the firm to allegedly cover the expenses of benefits for those deemed “non-equity partners.” Thus, pursuant to the agreement issued by the firm, Hall was to receive $450,000 as a salary for 2015 with a monthly draw (after monies were held back) of $28,900, and a bonus of $125,000 to be paid midway through the year. In addition, Morehous was to receive $400,000 as a salary for 2015 with a monthly draw of $26,700 (after monies were held back), and a bonus of $20,000 to be paid midway through the year. As Hall and Morehous were about to start a trial in Sonoma County, they received a change in compensation letter on April 30, 2015. Hall and Morehous claimed that the firm unilaterally changed the terms of their employment. They alleged that after receiving their monthly salary for the first three months of 2015, they were notified that their compensation would change from a salary and bonus, to a percentage of billing. They further alleged that the April 2015 compensation letters asserted that the awarded bonuses would now only be paid if they were employed as of July 31, 2015 and that the changes were made without notice or their agreement, and without payment of their salary that was supposed to be due on April 30, 2015. Hall and Morehous claimed that as a result, they only continued their employment with the firm until May 13, 2015, so as to discharge their trial responsibilities to their client. Hall and Morehous sued Novak Druce Connolly Bove + Quigg, alleging violations of the Labor Code. Plaintiffs’ counsel contended that as a method to maintain some cash flow, the firm held back portions of the plaintiffs’ salaries during each calendar year, but instead of holding backing portions to cover the expenses of benefits for those deemed “non-equity partners,” as alleged, the monies were placed into the firm’s general account and used for general business expenses. Counsel also contended that the holdbacks had always been paid by April of the following year so that the amounts could be incorporated into the employees’ tax returns. Specifically, Hall claimed that an equity partner of the firm explained to him at the time of his hiring that the holdbacks would be paid as soon as possible, but no later than April 15 of the following year. However, the firm’s former counsel, in a letter written to the Department of Industrial Relations, indicated only that the holdback payments were “customarily” paid “during the month of April of the following calendar year” and that “the firm intends to disburse the 2014 holdback amounts to all non-equity partners by the end of this calendar year.” Despite this, plaintiffs’ counsel asserted that Novak Druce Connolly Bove + Quigg sought to avoid paying back its creditors, including Hall and Morehous, and that the firm took the position that it could pay Hall and Morehous back the holdback amounts whenever it likes. Defense counsel asserted that Hall and Morehous were “partners,” and not “employees,” and, therefore, were not entitled to the protections of the Labor Code. Counsel acknowledged that the April 2015 change in compensation letters did state that awarded bonuses would only be paid if the person awarded a bonus was employed by the firm as of July 31, 2015. However, defense counsel asserted that the original letters sent in February 2015 provided that bonuses would be paid if the person was employed by the firm as of July 15, 2015, which Hall and Morehous were not. Thus, counsel contended that Hall and Morehous were not entitled to a bonus because they did not stay employed with the firm until July 31, 2015, or July 15, 2015, and that Hall and Morehous had begun interviewing with another firm prior to the April 30, 2015 change in compensation letter. In addition, defense counsel contended that Hall and Morehous never recorded any time in connection with the alleged trial in Sonoma County., Hall and Morehous sought recovery of unpaid back wages, unpaid bonuses, and unpaid holdback monies due to them. They also sought recovery of attorney fees pursuant to the California Labor Code. Specifically, Hall claimed that he was owed $43,000 in back wages, $52,000 in holdback monies, and $125,000 for the unpaid bonus. Morehous claimed that he was owed $40,000 in back wages, $37,800 in holdback monies, and $20,000 for the unpaid bonus. Attorney fees were also sought for unpaid wages. Defense counsel disputed the amounts alleged by Hall and Morehous. According to the firm, Hall was only owed $52,054.20 for money held back from his paychecks and Morehous was only owed $37,843.89 for money held back from his paychecks.