Judge: Elaine Lu, Case: 20STCV27249, Date: 2022-09-14 Tentative Ruling

Case Number: 20STCV27249    Hearing Date: September 14, 2022    Dept: 26

Superior Court of California

County of Los Angeles

Department 26

Background

            On July 20, 2020, Plaintiffs Armen Muradyan and High Standard Transport (jointly “Plaintiffs”) filed the instant action against Defendants FCA US LLC, McPeek’s Dodge of Anaheim, and Glendale Dodge, LLC (collectively “Defendants”) .  The complaint asserts two causes of action for (1) Violations of the Song-Beverly Consumer Warranty Act and (2) Negligent Repairs arising out of the purchase and repairs of a 2018 RAM 5500 Chassis CAB. 

            On February 23, 2022, the parties filed their settlement agreement and a stipulation, which the Court granted, to dismiss the action with the Court retaining jurisdiction pursuant to Code of Civil Procedure section 664.6 including retaining jurisdiction to hear a motion for attorneys’ fees pursuant to the settlement agreement.. 

            On February 17, 2022, Plaintiffs filed the instant motion for attorneys’ fees.  On August 31, 2022, Defendant filed an opposition.  On September 7, 2022, Plaintiffs filed a reply.

Evidentiary Objections

            Defendants have submitted evidentiary objections to portions of the declaration of Mark O’Connor and the compendium of evidence.  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.)

            Here, on August 23, 2021, the parties settled the instant action.  (O’Connor Decl. ¶ 5, Exh. 1.)   Pursuant to the settlement agreement, Plaintiffs are the prevailing party and are entitled to attorneys’ fees pursuant to Civil Code section 1794(d). 

Reasonableness of Attorney’s Fees

Plaintiffs seek attorney fees in the amount of $230,833.00 consisting of $115,416.50 in attorney fees and a 2 multiplier enhancement on the attorney fees for an additional $115,416.50. (O’Connor Decl. ¶¶ 25-26, Exhs. 13-14.)

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.)

Here, Attorney Mark O’Connor, an attorney with Plaintiffs’ Counsel, O’Connor Law Group, P.C., bills at an hourly rate of $695 and spent a total of 35.3 hours on the instant action.  (O’Connor Decl. ¶¶ 22, 25-26, Exhs. 13-14.)  O’Connor has 32 years of experience practicing as an attorney in Pennsylvania, New Jersey, and California.  (O’Connor Decl. ¶ 20.)  O’Connor has significant experience with product liabilities with motor vehicles and served as in-house counsel for Mazda for 9 years.  (O’Connor Decl. ¶¶ 20-21.)  Further, O’Connor’s hourly rate is consistent with other attorneys with similar experience.  (O’Connor Decl. ¶ 22.) 

Attorney Larry S. Castruita, an attorney with Plaintiffs’ Counsel bills at an hourly rate of $500 and spent a total of 134.5 hours on the instant action.  (Castruita Decl. ¶ 5; O’Connor Decl. ¶¶ 25-26.)  Castruita has been an attorney since June 2011 and currently specializes currently specializes in consumer law, lemon law, and contract law.  (Castruita Decl. ¶ 3.)  Castruita states that his hourly rate is consistent with other attorneys of similar experience.  (Castruita Decl. ¶ 6.)

Attorney Elizabeth A. Wagner, an attorney with Plaintiffs’ Counsel bills at an hourly rate of $400 and spent 9.3 hours on the instant action.  (Wagner Decl. ¶ 5, O’Connor Decl. ¶¶ 25-26, Exhs. 13-14.)  Wagner has been an attorney since December of 2017 and currently specializes in consumer law, lemon law, and contract law.  (Wagner Decl. ¶ 3.)  Wagner states that her hourly rate is consistent with other attorneys of similar experience.  (Wagner Decl. ¶ 6.) 

Attorney Matthew T. Goethals, an attorney with Plaintiffs’ Counsel bills at an hourly rate of $275 and spent 29.8 hours on the instant action.  (Goethals Decl. ¶ 5, O’Connor Decl. ¶¶ 25-26, Exhs. 13-14.)  Goethals has been an attorney since January 2021 and currently specializes in consumer law, lemon law, and contract law.  (Goethals Decl. ¶ 3.)  Goethals states that his hourly rate is consistent with other attorneys of similar experience.  (Goethals Decl. ¶ 6.) 

Kristin N. Arndt, a paralegal with Plaintiffs’ Counsel bills at an hourly rate of $135 and spent a total of 75.1 hours on the instant action.  (Arndt Decl. ¶ 6; O’Connor Decl. ¶¶ 25-26, Exhs. 13-14.)  Arndt has ten years of experience as a paralegal with seven years of experience in asbestos litigation and now currently focuses on consumer law, lemon law, and contract law.  (Arndt Decl. ¶ 4.)  Arndt states that her hourly rate is consistent with other paralegals in the area with similar experience.  (Arndt Decl. ¶ 7.)

David Womack, a paralegal with Plaintiffs’ Counsel bills at an hourly rate of $135 and spent a total of 11.7 hours on the instant action.  (Womack Decl. ¶ 6; O’Connor Decl. ¶¶ 25-26, Exhs. 13-14.)  Womack has six years of experience as a paralegal and currently focuses on consumer law, lemon law, and contract law.  (Womack Decl. ¶ 3.)  Womack states that his hourly rate is consistent with other paralegals in the area with similar experience.  (Womack Decl. ¶ 7.)

In sum, four attorneys and two paralegals spent a total of 295.7 hours on the instant action over two years.  Based on the stated experience of each respective attorney and prevailing rates of similar, the Court finds the hourly rates are reasonable.  As to the fees by paralegals and legal assistants, the Court notes that case law has indicated what has been considered a reasonable hourly rate for paralegals in the greater Los Angeles area.  For example, in Cruz ex rel. Cruz v. Alhambra School Dist. (C.D. Cal. 2009) 601 F.Supp.2d 1183, the Central District Court concluded over 13 years ago that $125 per hour was in line with prevailing market rates for law clerks and paralegals.  (Id. at p.1195.)  An increase of $10 hourly increase more than a decade later for a certified paralegal and the same rate for a legal assistant is well within the findings in Cruz ex rel. Cruz. 

However, the number of attorneys working on the instant action is slightly excessive. “Plainly, it is appropriate for a trial court to reduce a fee award based on its reasonable determination that a routine, non-complex case was overstaffed to a degree that significant inefficiencies and inflated fees resulted.”  (Morris v. Hyundai Motor America (2019) 41 Cal.App.5th 24, 39.)  Here, the instant action did not involve any complicated issues.  Rather, the instant action was simple and routine.  Yet, four separate attorneys and two paralegals worked on the instant action.  This is seen in some of the inefficiencies in billing.  Further, given Plaintiffs’ Counsel firm’s expertise in lemon law actions, as reflected in Counsel’s hourly rates, the Court finds the hours billed on pursuing discovery to be excessive.  In light of Plaintiff’s Counsel’s firm’s expertise in lemon law matters and in light of the availability of templates from other lemon law actions that Plaintiff’s 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 Plaintiff’s Counsel billed.  Moreover, there was very little to no motion practice in this action, with only a single moot motion – besides the instant motion being heard.  Accordingly, given these factors, a reduction is warranted. 

As to the times challenged by Defendant, the Court finds that a slight reduction is warranted.  First, the anticipated time spent on opposing a motion to tax costs is unwarranted as no motion to tax was filed in the instant action.  Accordingly, an elimination of these anticipated costs totaling $2,050.00 in opposing a motion to tax is warranted. 

Second, as to the billing Defendants contend are unreasonable, vague, duplicative, the Court agrees that a slight reduction is warranted.  Plaintiffs claim that Attorney O’Connor spent 16.7 hours reviewing the facts of this case before the instant action was filed.  (O’Connor Decl., Exh. 14.)  Further, the billing records state that Plaintiffs’ Counsel spent 3.5 hours drafting and revising the complaint.  (O’Connor Decl., Exh. 14.)   Given that nearly no unique facts were alleged in the complaint and that the instant action did not involve any unique or challenge questions of law or fact, the time spent was excessive.  Accordingly, a reduction of 6 hours is warranted.

As to the challenged time spent reviewing, propounding, and meeting and conferring regarding discovery – i.e., 42.1 hours – the Court finds that the claimed time is excessive.  As noted above, the instant action was not a significantly complex action.  This is particularly excessive as most of the meet and confer efforts by Plaintiffs’ Counsel were merely emails.  (See e.g., Order 5/7/21.)  Accordingly, a significant reduction of 15 hours is warranted.

With regard to the instant motion, Plaintiffs’ Counsel claims 12.4 hours in drafting, reviewing and revising the instant motion and anticipates an additional four hours in reviewing the opposition and drafting a reply.  Given Plaintiffs’ Counsel experience, this time is slightly excessive, warranting a reduction of 2.5 hours.

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 $68,349.00 

Lodestar Enhancement

Plaintiffs request a lodestar enhancement multiplier of 2 given the contingent risk, the substantial delay in payment, preclusion of other work, the skill displayed in presenting the issues, and the outcome achieved.  Defendants oppose stating that the enhancement is not warranted, the amount has been included already in the attorney fees, that the case was not particularly complex, and that the contingent nature of this case is overstated. 

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

On March  15, 2022 the Parties filed a stipulation – which the Court granted – settling the parties’ costs at $6,000.00.  Accordingly, the request for costs is moot.

CONCLUSION AND ORDER

Based on the foregoing, Plaintiffs Armen Muradyan and High Standard Transport’s motion for attorneys’ fees is GRANTED in the total amount of $68,349.00.

The Moving Parties are to give notice and file proof of service of such.

DATED: September 14, 2022                                                ___________________________

                                                                                          Elaine Lu

                                                                                          Judge of the Superior Court