Judge: Elaine Lu, Case: 19STCV46085, Date: 2023-09-27 Tentative Ruling

Case Number: 19STCV46085    Hearing Date: September 27, 2023    Dept: 26

Superior Court of California

County of Los Angeles

Department 26

Procedural Background

            On December 23, 2019, Plaintiffs Maria Del Carmen Valdovinos Rosales and Christina P. Alquisiras Valdovinos (jointly “Plaintiffs”) filed the instant action arising out of their lease of a 2018 Kia Optima (“the Subject Vehicle”).  On July 10, 2020, Plaintiffs filed the operative first amended complaint (“FAC”) against Kia Motors America, Inc. (“Defendant”) asserting causes of action for (1) violation of the Song-Beverly Act –  breach of express warranty; (2) violation of the Song-Beverly Act –  breach of implied warranty; (3) violation of the Song-Beverly Act section 1793.2; (4) fraudulent inducement –  concealment; and (5) fraudulent inducement – intentional misrepresentation. 

            On June 16, 2022, Plaintiffs filed a notice of settlement of the entire action.  On December 29, 2022, Plaintiffs filed a memorandum of costs.  On January 18, 2023, Defendant filed the instant motion to tax costs.  On September 13, 2023, Plaintiffs filed an opposition.  On September 19, 2023, Defendant filed a reply.

Legal Standard

“A prevailing party is entitled ‘as a matter of right’ to recover costs in any action or proceeding unless a statute expressly provides otherwise.”  (Segal v. ASICS America Corp. (2022) 12 Cal.5th 651, 658.)  “Section 1033.5 sets forth the types of expenses that are and are not allowable as costs under section 1032. Specifically, subdivision (a) of section 1033.5 describes items that are ‘allowable as costs,’ subdivision (b) describes items ‘not allowable as costs, except when expressly authorized by law,’ and section 1033.5(c)(4) provides that ‘[i]tems not mentioned in this section and items assessed upon application may be allowed or denied in the court's discretion.’”  (Ibid.)

For a cost to be recoverable, it must be reasonably necessary to the litigation and reasonable in amount. (Perko’s Enterprises, Inc. v. RRNS Enterprises (l992) 4 Cal.App.4th 238, 244.) If the items appearing in a cost bill appear to be proper charges, the burden is on the party seeking to tax costs to show that they were not reasonable or necessary. (Ladas v. California State Automotive Assoc. (1993) 19 Cal.App.4th 761, 773-74.)  On the other hand, if the items are properly objected to, they are put in issue, and the burden of proof is on the party claiming them as costs. (Id.) 

California Rule of Court, Rule 3.1700 requires that “[a]ny notice of motion to strike or to tax costs must be served and filed 15 days after service of the cost memorandum. If the cost memorandum was served by mail, the period is extended” by up to 20 days. (Cal. Rules of Court, Rule 3.1700(b)(1).) Additionally, “[T]he court may extend the times for serving and filing the cost memorandum or the notice of motion or tax costs for a period not to exceed 30 days.” (Cal. Rules of Court, Rule 3.1700(b)(3).) 

Discussion

            Defendant seeks to tax a total of $26,982.28 in costs as follows (1) $588.75 in filing and motion fees, claimed under Item 1; (2) $7,366.54 in deposition costs, claimed under Item 4; (3) $690.25 in service of process costs, claimed under Item 5; (4) $105.00 in ordinary witness fees, claimed under Item 8a; (5) $8,826.75 for expert witness fees, claimed under Item 8b; (6) $3,810.72 for delivery of binders; pick up trial boxes; delivery of thumb drive; etc., claimed under Item 11; (7) $4,207.00 for Court reporter fees, claimed under Item 12; and (8) $1,387.27 for attorney services and messengers, overnight and CourtCall, claimed under Item 13.

“If items on a memorandum of costs appear to be proper charges on their face, those items are prima facie evidence that the costs, expenses, and services are proper and necessarily incurred. [Citation.] The burden then shifts to the objecting party to show them to be unnecessary or unreasonable.”  (Doe v. Los Angeles County Dept. of Children & Family Services (2019) 37 Cal.App.5th 675, 693.)  “[T]he objecting party has the burden to show that a cost item is unrecoverable because it was not necessary to the litigation.”  (Hooked Media Group, Inc. v. Apple Inc. (2020) 55 Cal.App.5th 323, 338.)  “It is not necessary that the [moving party], …, accompany the motion to tax cost with any affidavit.”  (State of California v. Meyer (1985) 174 Cal.App.3d 1061, 1075.)  However, more than a bare objection is needed to rebut the presumption that fees were reasonable and necessarily incurred.”  (State of California, supra, 174 Cal.App.3d at p.1075.)

Here, Plaintiff is a prevailing buyer under the Song-Beverly Act.  “Section 1794, subdivision (d), permits the prevailing buyer to recover both ‘costs’ and ‘expenses.’”  (Jensen v. BMW of North America, Inc. (1995) 35 Cal.App.4th 112, 137.) 

The Legislature added the “costs and expenses” language to section 1794 in 1978. (Stats. 1978, ch. 991, § 10, p. 3065.) An analysis by the Assembly Committee on Labor, Employment, and Consumer Affairs states: “Indigent consumers are often discouraged from seeking legal redress due to court costs. The addition of awards of 'costs and expenses' by the court to the consumer to cover such out-of-pocket expenses as filing fees, expert witness fees, marshall’s fees, etc., should open the litigation process to everyone.” (Assem. Com. on Labor, Employment & Consumer Affairs, Analysis of Assem. Bill No. 3374 (May 24, 1978) p. 2.)

(Id. at p.138.)

“[T]he Legislature amended section 1794 to provide for the recovery of “costs and expenses.” The legislative history indicates the Legislature exercised its power to permit the recovery of expert witness fees by prevailing buyers under the Act[.]”  (Ibid.)  “[T]he Legislature intended the phrase ‘costs and expenses’ to cover items not included in ‘the detailed statutory definition of “costs” ’ set forth in Code of Civil Procedure section 1033.5.”  (Warren v. Kia Motors America, Inc. (2018) 30 Cal.App.5th 24, 42.)  Therefore, a prevailing buyer is entitled to “costs and expenses” that have been “determined by the court to have been reasonably incurred by the buyer in connection with the commencement and prosecution of such action.”  (Civ. Code, § 1794(d).)

Filing Fees

Filing fees are expressly allowable as costs. (CCP §1033.5(a)(1).)  Thus, the burden is on Defendant to show that the filing costs of $588.75 were not reasonably necessary for the litigation.  Defendant fails to meet this burden.  Defendant merely claims that each of the filing fees sought were unsuccessful and therefore cannot be recovered.  However, the mere fact that the motions were unsuccessful alone does not show that they were not reasonably necessary for the litigation.  This is a bare objection which is insufficient to tax a permitted cost.  (State of California, supra, 174 Cal.App.3d at p.1075.)  Moreover, many of the cited motions were not adversely determined against Plaintiffs but rather taken off calendar such as the motion to compel deposition.  Thus, Defendant fails to show that these motions were not reasonably necessary.

Deposition Costs

            Defendant seeks to tax $7,366.54 in deposition costs, $690.25 in service of process costs, and $105.00 in witness fees.  The costs for taking, video recording, and transcribing necessary depositions are expressly permitted as costs.  (CCP § 1033.5(a)(3)(A).)  Similarly, service of process and witness fees are expressly permitted.  (CCP § 1033.5(a)(4),(7).)  Therefore, the burden is on Defendant to show that the costs are unnecessary or unreasonable.  Defendant fails to do so. 

            Defendant merely claims that the fees for deposing service technicians were unnecessary because “[a]s attorneys who specialize in this area of the law, Plaintiffs’ attorneys know there is no reason to take the depositions of service advisors and technicians because the service advisors and technicians keep a contemporaneous record of their work on the repair orders they prepare each time they work on a vehicle. Plaintiffs’ attorneys also know the service advisors and technicians work on hundreds of vehicles each year and cannot remember each one.”  (Motion at p.3:9-15.)  However, Defendant has failed to submit any evidence to support this claim.  A memorandum is not evidence, and “the court must disregard ‘facts’ contained in an unverified statement.”  (Smith, Smith & Kring v. Superior Court (Oliver) (1997) 60 Cal.App.4th 573, 578.)  Defendant similarly claims that the deposition of Defendants expert Alberto P. Perez was excessive.  However, Defendant fails to explain how this cost is excessive.  At best, Defendant merely makes a bare objection to the cost.  This is insufficient to tax a permitted cost.  (State of California, supra, 174 Cal.App.3d at p.1075.) 

Expert Witness Fees

            Expert witness fees are generally not permitted unless ordered by the court under Code of Civil section 1033.5(a)(8) or “except when expressly authorized by law.”  (CCP § 1038(b).)  However, Plaintiffs are prevailing buyers under the Song-Beverly Act.  “Section 1794, subdivision (d), permits the prevailing buyer to recover both ‘costs’ and ‘expenses.’”  (Jensen v. BMW of North America, Inc. (1995) 35 Cal.App.4th 112, 137.) 

The Legislature added the “costs and expenses” language to section 1794 in 1978. (Stats. 1978, ch. 991, § 10, p. 3065.) An analysis by the Assembly Committee on Labor, Employment, and Consumer Affairs states: “Indigent consumers are often discouraged from seeking legal redress due to court costs. The addition of awards of 'costs and expenses' by the court to the consumer to cover such out-of-pocket expenses as filing fees, expert witness fees, marshall’s fees, etc., should open the litigation process to everyone.” (Assem. Com. on Labor, Employment & Consumer Affairs, Analysis of Assem. Bill No. 3374 (May 24, 1978) p. 2.)

(Id. at p.138.)

“[T]he Legislature amended section 1794 to provide for the recovery of “costs and expenses.” The legislative history indicates the Legislature exercised its power to permit the recovery of expert witness fees by prevailing buyers under the Act[.]”  (Ibid.)  “[T]he Legislature intended the phrase ‘costs and expenses’ to cover items not included in ‘the detailed statutory definition of “costs” ’ set forth in Code of Civil Procedure section 1033.5.”  (Warren v. Kia Motors America, Inc. (2018) 30 Cal.App.5th 24, 42.)  Therefore, a prevailing buyer is entitled to “costs and expenses” that have been “determined by the court to have been reasonably incurred by the buyer in connection with the commencement and prosecution of such action.”  (Civ. Code, § 1794(d).)

Expert Fees clearly fall within the intended expenses and legislative history of Civil Code section 1794.  (Jensen, supra, 35 Cal.App.4th at p.138.)  Moreover, expert witness fees are expenses that are clearly reasonably incurred by the buyer with the commencement and prosecution of such action.  However, not all of the claimed expert fees are reasonable nor incurred in connection with the Song-Beverly Claims.

Plaintiff retained expert Barbara Luna to testify as to punitive damages, Defendant’s financial condition and net worth, and the valuation of damages and the financial impact of damages on Defendant.  (Douglas Decl. ¶ 5, Exh. 2.)  Only civil penalties are available for the Song-Beverly claims – not punitive damages.  Thus, the punitive damage testimony could only be for the non-Song-Beverly Claims.  As such, the fees incurred in connection with retaining expert Barbara Luna are not recoverable.  Accordingly, a reduction of $3,578.75 in costs is warranted.

As to expert Anthony Micale, the expert fee is excessive.  As Plaintiffs’ Counsel stated under oath during expert witness disclosure, Micale’s hourly rates were $350.00 per hour for providing deposition testimony and or consulting with the retaining attorney, $350.00 per hour for vehicle inspections and investigations and $150.00 per hour for travel and additional $0.55 per mile.  (Douglas Decl. ¶ 7, Exh. 4.)  In stark contrast, on the invoice provided, Micale claimed expert fees of 8.75 hours at $400 per hour and 4 hours at $425 per hour.  (Douglas Decl. ¶ 8, Exh. 5.)  These hourly rates are plainly inconsistent with Plaintiffs’ counsel’s statements under oath.  The Court concludes that the reasonable hourly rates were those represented by Counsel under oath.  Thus, a further reduction of $737.50 is warranted.

Models, Blowups, and Photocopies

            Defendant seeks to strike the entirety of costs claimed for models, blowups, and photocopies of exhibits.  These fees are expressly permitted.  (CCP § 1033(a)(13).)  Further these costs appear reasonable given that the action nearly proceeded to trial.  Defendant’s mere objection that these costs were not reasonably incurred is insufficient.

Court Reporter Fees

            Defendant contends that the court reporter fees are excessive on their face because they exceed the Los Angeles Superior Court fee schedule and are therefore not reasonably incurred.  In general, transcripts of proceedings not ordered by the court are not recoverable costs.  (CCP § 1033.5(b)(5).)  Accordingly, the Costs are only permitted if reasonably incurred with the Song-Beverly Claims. 

            The summary adjudication proceeding related only to the fraud claims.  (Order 7/23/21.)  Thus, the court reporter fees relating to that hearing are not recoverable under Civil Code § 1794.  However, the remaining Court reporter fees do appear to be reasonably incurred in connection with the Song-Beverly claims.  Accordingly, the court reporter fees are taxed a total amount of $645.00.

Messenger Fees

Here, the memorandum of costs denotes that Plaintiff incurred $1,387.27 in messenger courtesy copy fees, overnight, and CourtCall fees.  While these fees are not expressly authorized as an allowable cost under Code of Civil Procedure section 1033.5, nor are they precluded.  The Court finds that the messenger fees for motions and other filed documents were reasonably necessary for litigation of this action to provide curtesy copies to the Court.  Accordingly, the Court declines to tax these costs.  However, as guidance for future cases, all counsel are hereby informed that to minimize costs, the Court does NOT require courtesy copies.

Attorney Fees in Opposition

            In opposition, Plaintiff seeks attorney fees in the amount of $2,970.00 spent opposing the instant motion.  However, attorney fees must be sought through a motion unless the fees are fixed without the necessity of a court determination.  (Cal. Rules of Court, Rule 3.1702.)  Moreover, such a motion would be untimely.  (Cal. Rules of Court, Rule 3.1702(b)(1).)  Accordingly, Plaintiffs’ request for fees in opposition is DENIED.

CONCLUSIONS AND ORDER

            Based on the forgoing, Defendant Kia Motors America, Inc.’s motion to tax costs is GRANTED IN PART as to $4,316.25 in expert witness fees and $645.00 in court reporter fees.

            Moving Party is ordered to provide notice of this order and file proof of service of such.

DATED: September ___, 2023                                              ___________________________

                                                                                          Elaine Lu

                                                                                          Judge of the Superior Court