Judge: Elaine Lu, Case: 20STCV05186, Date: 2023-02-28 Tentative Ruling

Case Number: 20STCV05186    Hearing Date: February 28, 2023    Dept: 26

Superior Court of California

County of Los Angeles

Department 26

Procedural Background

            On February 7, 2020, Plaintiffs Luis Huang and Richard Meng (jointly “Plaintiffs”) filed the instant lemon law action against Defendant Mercedes-Benz USA, LLC (“Defendant”).  The Complaint asserts four causes of action for (1) Violation of Song-Beverly Act – Breach of Express Warranty, (2) Violation of Song-Beverly Act -Breach of Implied Warranty, (3) Violation of the Song-Beverly Act Section 1793.2, and (4) Violation of the Song-Beverly Act section 1793.22 – Tanner Consumer Protection Act.   

            On June 28, 2022. Plaintiffs filed a notice of settlement of the entire action.

            On August 11, 2022, Plaintiffs filed the instant motion for attorneys’ fees and costs.  On February 15, 2023, Defendant filed an opposition.  On February 21, 2023, Plaintiffs filed a reply.

Evidentiary Objections

            In reply, Plaintiffs have submitted evidentiary objections to portions of the declarations of Jeffrey T. Thayer.  However, these objections are unnecessary because the Court, when reviewing the evidence is presumed to ignore material it knows is incompetent, irrelevant, or inadmissible.  (In re Marriage of Davenport (2011) 194 Cal. App. 4th 1507, 1526.)  Courts are presumed to know and apply the correct statutory and case law and to be able to distinguish admissible from inadmissible evidence, relevant from irrelevant facts, and to recognize those facts which properly may be considered in the judicial decision-making process.  (People v. Coddington (2000) 23 Cal.4th 529, 644.)

Legal Standard

Pursuant to Code of Civil Procedure section 1033.5, subdivision (a)(10)(A), attorney fees when authorized by contract or statute are allowable as costs and may be awarded upon a noticed motion pursuant to Code of Civil Procedure section 1033.5, subdivision (c)(5).

In determining what fees are reasonable, California courts apply the “lodestar” approach. (See, e.g., Holguin v. DISH Network LLC (2014) 229 Cal.App.4th 1310, 1332.)  This inquiry “begins with the ‘lodestar,’ i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate.” (See PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1095.)  From there, the “[t]he lodestar figure may then be adjusted, based on consideration of factors specific to the case, in order to fix the fee at the fair market value for the legal services provided.” (Ibid.)  Relevant factors include: “(1) the novelty and difficulty of the questions involved, (2) the skill displayed in presenting them, (3) the extent to which the nature of the litigation precluded other employment by the attorneys, [and] (4) the contingent nature of the fee award.” (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1132.)

Discussion

Right to Recover

A prevailing buyer in an action under the Song-Beverly Act “shall be allowed by the court to recover as part of the judgment a sum equal to the aggregate amount of costs and expenses, including attorney's fees based on actual time expended, 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).)  “[W]hen ‘prevailing party’ is undefined by the statute, ‘a court may base its attorney fees decision on a pragmatic definition of the extent to which each party has realized its litigation objectives, whether by judgment, settlement or otherwise. [Citations.] In assessing litigation success, Hsu v. Abbara (1995) 9 Cal.4th 863, 877, ... instructs: ‘[C]ourts should respect substance rather than form, and to this extent should be guided by “equitable considerations.”’”  (MacQuiddy v. Mercedes-Benz USA, LLC (2015) 233 Cal.App.4th 1036, 1048.)

            On approximately June 8, 2022, the parties settled the instant action.  On October 20, 2022, the parties stipulated that Defendant had – as part of the settlement – agreed to pay Plaintiffs  attorneys’ fees, costs, and expenses under Civil Code section 1794(d).  No party disputes that Plaintiffs are entitled to attorneys fees and expenses as the prevailing party.

Reasonableness of Attorneys’ Fees

Plaintiffs seeks attorneys’ fees and costs totaling $168,439.88 consisting of $113,497.50 in attorneys’ fees, $39,724.12 in a 1.35 fee multiplier, $6,000.00 in anticipated attorneys’ fees for the reply and hearing for the instant motion, and $9,218.26 in costs.

The trial court has broad authority to determine the amount of a reasonable fee. (PLCM Group, Inc. v. Drexler (2000) 22 Cal.4th 1084, 1095.) The party bears the burden of proof as to “reasonableness” of any fee claim. (Code Civ. Proc., § 1033.5, subd. (c)(5).) The party seeking fees has the burden of documenting the appropriate hours expended and hourly rates. (City of Colton v. Singletary (2012) 206 Cal.App.4th 751, 784.) This burden requires competent evidence as to the nature and value of the services rendered. (Martino v. Denevi (1986) 182 Cal.App.3d 553, 559.)

An attorney's testimony as to the number of hours worked is sufficient evidence to support an award of attorney fees, even in the absence of detailed time records or billing statements, and there is no requirement that such records or statements be offered in evidence. (Steiny & Co., Inc. v. California Electric Supply Co. (2000) 79 Cal.App.4th 285, 293.)  Ascertaining the fee amount is left to the trial court’s sound discretion. (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1132.)  Moreover, “[t]here is ‘no mathematical rule requiring proportionality between compensatory damages and attorney's fees awards’, [Citation], and courts have awarded attorney's fees where plaintiffs recovered only nominal or minimal damages.”  (Harman v. City and County of San Francisco (2007) 158 Cal.App.4th 407, 421.)

Attorney Kevin Jacobson claims an hourly rate of $395 per hour in 2020, and an hourly rate of $500 per hour for 2021 and 2022.  (Jacobson Decl. ¶ 6.)  Jacobson has worked as an attorney since 2013 conducting hundreds of cases to trial and in 2019 co-found Plaintiffs’ Counsel Quill & Arrow, LLP.  (Jacobson Decl. ¶¶ 3-4.)  Jacobson is the managing partner at Plaintiffs’ Counsel, and his rate is consistent with those approved in other courts.  (Jacobson Decl. ¶¶ 4-6.)

Attorney Gregory Sogoyan claims an hourly rate of $425 per hour in 2021 and $450 per hour in 2022.  (Jacobson Decl. ¶ 8.)  Sogoyan has been an attorney since 2015 with significant experience in lemon law actions and with consumer fraud.  (Jacobson Decl. ¶ 7.)  This purposed hourly rate is consistent those approved in other courts.  (Jacobson Decl. ¶ 8.)

Attorney Athena Nguyen is a former associate attorney for Plaintiff’s Counsel who claims an hourly rate of $300 per hour in 2021.  (Jacobson Decl. ¶¶ 14-15.)  Nguyen has been an attorney since 2020 and focused on consumer litigation.  (Jacobson Decl. ¶ 14.)  Nguyen’s proposed hourly rate is consistent with those approved by other courts for attorney of similar experience.  (Jacobson Decl. ¶ 15.)

Pursuant to the billing records, these three attorneys claim to have spent a total of 272.20 hours on the instant action.  (Jacobson Decl. ¶ 16, Exh. 6.)  Based on the stated experience of each respective attorney and prevailing rates of similar, the Court finds the hourly rates are reasonable.  Moreover, these hourly rates are consisted with numerous cases in which their rates have been confirmed.  (Jacobson Decl. ¶¶ 9-13, Exhs. 1-5.)

However, in light of Plaintiffs’ Counsel’s firm’s expertise in lemon law actions, as reflected in Counsel’s hourly rates, the Court finds the hours billed on pursuing discovery and motions practice to be excessive.  In light of Plaintiffs’ Counsel’s firm’s expertise in lemon law matters and in light of the availability of templates from other lemon law actions that Plaintiffs’ Counsel’s firm has handled in the past, propounding discovery and litigating motions to compel further are routine matters that should have required only a fraction of the hours that Plaintiffs’ Counsel billed.  For example, Plaintiffs’ Counsel claims over 30 hours on motions in limine, which is plainly excessive as all of the motions in limine were routine and boilerplate.  Similarly, Plaintiffs’ Counsel claims nearly twenty hours for drafting the instant motion for attorneys’ fees and seeks an additional $6,000 to compensation Plaintiffs’ Counsel for time spent on the reply. Moreover, the instant action involved little to no motion practice and was a simple straightforward action.  On the other hand, the Court does recognize that the action did take place over two years and nearly proceeded to trial twice.

Given the totality of these factors the Court concludes based on the claimed experience of Plaintiffs’ Counsel, as reflected in their hourly rates, a significant reduction is warranted.  Utilizing a lodestar approach, and in view of the totality of the circumstances, the Court finds that the total and reasonable amount of attorney’s fees incurred is $78,450.00.

Lodestar Enhancement

Plaintiffs request a lodestar enhancement multiplier of 1.35 given the contingent risk, the substantial delay in payment, preclusion of other work, the skill displayed in presenting the issues, and the outcome achieved. 

In whether to apply a multiplier the California Supreme Court has given clear guidance for the trial courts to follow.

Of course, the trial court is not required to include a fee enhancement to the basic lodestar figure for contingent risk, exceptional skill, or other factors, although it retains discretion to do so in the appropriate case; moreover, the party seeking a fee enhancement bears the burden of proof. In each case, the trial court should consider whether, and to what extent, the attorney and client have been able to mitigate the risk of nonpayment, e.g., because the client has agreed to pay some portion of the lodestar amount regardless of outcome. It should also consider the degree to which the relevant market compensates for contingency risk, extraordinary skill, or other factors under Serrano III. We emphasize that when determining the appropriate enhancement, a trial court should not consider these factors to the extent they are already encompassed within the lodestar. The factor of extraordinary skill, in particular, appears susceptible to improper double counting; for the most part, the difficulty of a legal question and the quality of representation are already encompassed in the lodestar. A more difficult legal question typically requires more attorney hours, and a more skillful and experienced attorney will command a higher hourly rate.

(Ketchum, supra, 24 Cal.4th at pp.1138–1139.)

Here, many of the factors raised have already been addressed in the calculations of the hours worked and hourly rate above.  Therefore, the court finds that an enhancement multiplier is not appropriate for this case.

Costs

In opposition, Defendant contends that all of the costs should be stricken as Plaintiffs’ counsel fails to specify the item or tasks that resulted in the incurred costs.  The Court disagrees.  The costs are clearly specified and broken down by cost.  (Jacobson Decl., Exh. 6.)  The listed costs include, trial binders, private mediation, deposition costs, and filing costs all of which are clear and recoverable costs which can easily be determined based on the date of the claimed cost and the corresponding filings. 

Accordingly, the costs appear reasonable.

CONCLUSIONS AND ORDER

            Based on the forgoing, Plaintiffs Luis Huang and Richard Meng’s motion for attorneys’ fees and costs is granted in the total amount of $87,668.26 consisting of $78,450.00 in Attorneys’ Fees and $9,218.26 in Costs.

            Moving Parties are ordered to provide notice of this order and file proof of service of such.

DATED: February 28, 2023                                                   ___________________________

                                                                                          Elaine Lu

                                                                                          Judge of the Superior Court