Judge: Gail Killefer, Case: 21STCV14151, Date: 2023-04-20 Tentative Ruling

Case Number: 21STCV14151    Hearing Date: April 20, 2023    Dept: 37

HEARING DATE:                 April 20, 2023

CASE NUMBER:                  21STCV14151

CASE NAME:                        Cesar Blanco, et al. v. FCA US, LLC

MOVING PARTY:                Plaintiff, Cesar Blanco, on behalf of Three Stars Builders, Inc.  

OPPOSING PARTY:             Defendant, FCA US, LLC

TRIAL DATE:                        None – Notice of Settlement December 14, 2022

PROOF OF SERVICE:          OK

MOTION:                               Plaintiffs’ Motion for Attorney Fees

OPPOSITION:                       April 7, 2023

REPLY:                                  April 13, 2023

TENTATIVE:                         Plaintiffs’ motion is granted in part. Plaintiffs are awarded $33,669.90 in total attorney’s fees. Plaintiffs are to give notice.

Background

This is a lemon law action arising out of the purchase by Cesar Blanco, on behalf of Three Stars Builders, Inc. (“Plaintiffs”) of a new 2014 Dodge Ram (the “Vehicle”) manufactured by Defendant, FCA US, LLC (“FCA”).  Plaintiff alleges that the Vehicle was delivered with defects and nonconformities to warranty, including engine and electrical defects. Further, FCA allegedly failed to repair the Vehicle despite Plaintiffs allegedly presenting the Vehicle to FCA and its authorized representatives for repairs on several occasions.

Plaintiffs’ Complaint alleges four causes of action: (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, and (4) negligent repair against Defendant Champion Chrysler Jeep Dodge Ram Fiat.

On December 14, 2022, Plaintiffs filed a Notice of Conditional Settlement indicating that a request for dismissal would be filed by May 8, 2023. On December 14, 2022, the court set an Order to Show Cause regarding Dismissal after Settlement.

Plaintiffs now move for an award of attorney’s fees and costs. FCA opposes the motion. Because Defendants have also filed a motion to tax Plaintiffs’ memorandum of costs, the court will address Plaintiffs’ request for costs at the time of the hearing on Defendants’ motion. 

Evidentiary Objections

Defendant’s Objections to Declaration of Steve Kirnos

Overruled: Objections 1, 23.
Sustained:  Objections 2-22, 24-26. 

Discussion

Plaintiffs request an award of attorney’s fees in the total amount of $109,796.37, broken down as follows: (1) $61,218.00 lodestar amount, (2) $ 30,609.00 lodestar enhancement (0.5), (3) $17,969.37 costs and expenses.

I.                   Plaintiffs’ Entitlement to Attorney’s Fees

Plaintiffs request attorney’s fees as the prevailing party under the Song-Beverly Act, which allows a prevailing buyer to recover “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).) 

As a preliminary note, FCA argues the circumstances of this matter made “garden variety civil dispute” as evidenced by the fact that Defendant bid against itself in serving a second CCP § 998 Offer which Plaintiffs accepted. (Opp., 2.)

The court will proceed to analyze the merits of the parties’ remaining arguments.

II.                Reasonable Amount of Attorney’s Fees Award

“A trial court assessing attorney fees begins with a touchstone or lodestar figure, based on the ‘careful compilation of the time spent and reasonable hourly compensation of each attorney ... involved in the presentation of the case.”  (Christian Research Inst. v. Alnor (2008) 165 Cal.App.4th 1315, 1321 (Christian).)  The Court “need not simply award the sum requested.  To the contrary, ascertaining the fee amount is left to the trial court’s sound discretion.”  (Ibid.)  “The reasonableness of attorney fees is within the discretion of the trial court, to be determined from a consideration of such factors as the nature of the litigation, the complexity of the issues, the experience and expertise of counsel and the amount of time involved.  The court may also consider whether the amount requested is based upon unnecessary or duplicative work.”  (Wilkerson v. Sullivan (2002) 99 Cal.App.4th 443, 448.)  “The basis for the trial court’s calculation must be the actual hours counsel has devoted to the case, less those that result from inefficient or duplicative use of time.”  (Horsford v. Board of Trustees of California State University (2005) 132 Cal.App.4th 359, 395 (Horsford).)  “The law is clear, however, that an award of attorney fees may be based on counsel’s declarations, without production of detailed time records.  (Raining Data Corp. v. Barrenechea (2009) 175 Cal.App.4th 1363, 1375.)   

1)      Billing Rates Requested

Plaintiffs submit the declaration of Steve Kirnos (“Kirnos”) in support of the rates requested by their attorneys. Kirnos attests that he has been admitted to practice since 2009 and that he is a managing partner of Knight Law Group, Plaintiffs’ counsel of record. (Kirnos Decl. ¶¶ 34-35.) Kirnos further speaks to his experience as trial counsel on several litigations, as well as his experience litigating before federal courts as lead attorney for Knight Law Group. (Kirnos Decl. ¶¶35-36.) Kirnos attests that his billing rate is $500 per hour for this matter. (Kirnos Decl. ¶ 37.)

Kirnos further attests that 14 law clerks and attorneys from his firm billed for services in this litigation, ranging from $175 per hour to $500 per hour. (Kirnos Decl. ¶¶ 34-51.)

In opposition, FCA contends the requested rates should be reduced on three different grounds. (Opposition, 7-8.) First, FCA correctly points out having “13 attorneys and one law clerk billed time to this case creates inefficiency,” and leads to overstaffing. (Opp., 5-6; citing Morris v. Hyundai Motor America (2019) 41 Cal.App.5th 24, 41.) FCA further contends Plaintiffs fail to submit sufficient evidence to substantiate their claims of time spent and services rendered. (Opp., 9.)

Second, FCA contends the rates sought are excessive as there was “nothing novel or difficult about this case” and “no special skill was displayed in presenting this claim.” (Opp., 12.)

A trial court has broad discretion to award or reduce the requested rates and amounts in any motion for attorney’s fees. Here, the court again notes, sua sponte, the sheer number of attorneys and associates assigned to this matter, which ultimately settled before trial. Plaintiffs, in their moving papers and declarations, fail to provide a reasonable explanation as to why 13 different attorneys worked on this matter, when no dispositive motions were heard by this court and only limited motions regarding discovery. Therefore, this court is persuaded by Defendant’s contention that the mere number of assigned counsel speaks to an inefficiency of time spent, among other factors this court is empowered to consider. (Morris, supra, 41 Cal.App.5th at 41.) Thus, the court exercises its discretion; finds that the rates Kirnos attests to for himself and other attorneys in his office are unreasonable given a lack of showing that the matters considered were complex, that the number of assigned attorneys and paralegals were justified, and that time was not inefficiently billed; and applies a 45% reduction to the requested lodestar amount in total.

1)      Hours Requested

Plaintiffs request attorney’s fees in connection with a total of 163 hours of attorney, law clerk, and paralegal time. (Kirnos Decl., Exhibit A.) Plaintiffs contend that this amount is warranted because this action involved “a range of specialized knowledge” on consumer protection laws, and also involved responding to FCA’s litigation tactics of maintaining that it had no liability. (Motion, 9-10.) 

In opposition, Defendant contends that the amount requested is unreasonable because utilizing too many attorneys was inefficient. (Opp., 5-10.) As discussed above, Defendants request a total reduction of nearly fifty percent, leading to a total award of $32,950.30. (Opp., 14-15.)

In reply, Plaintiffs seek to distinguish from Donahue v. Donahue (2010) 182 Cal.App.4th 259 by contending the use of several attorneys at trial was the foremost concern for the Donahue court. (Reply, 4-8.) Plaintiffs contend, unlike Donahue, “Knight Law’s strategy of having different, specialized attorneys work on different aspects of the case increases efficiency and efficacy.” (Id.) Plaintiffs attempts to distinguish from Donahue are unpersuasive.

In Donahue, the Court of Appeal found that Plaintiff retaining two major law firms to represent him and then seeking attorney’s fees for both was unreasonable. (Donahue, supra, 272-274.) However, the Court of Appeal specifically found the trial court order awarding both firms fees insufficient because it did not analyze whether such an award was reasonable in light of Plaintiff’s role as trustee, and whether such fees were reasonable and prudent for the interests of the trust. (Id. at 274.) Thus, Donahue is not applicable to the instant action.  

As previously discussed, this court has reviewed Plaintiff’s counsel’s billing records, attached as Exhibit A to the Kirnos Declaration.

Here, the court finds a 45% reduction to be reasonable given the billing records fail to explain why so many attorneys, even 13 without the consideration of the 1 law clerk, were involved in this litigation, why their rates, on average, were increased such drastically over the course of three years, and why they should be awarded for unsuccessful motions. Based on the complexity of issues presented in the instant motion, the court finds that the requested hours for several tasks are excessive and unnecessary. Further, the reduction also encompasses a decrease in time awarded for the moving and reply papers for this motion, as the reply was short and a good portion of it was simply a repeat of the motion briefing.

For these reasons, the court applies a 45% reduction to the requested lodestar amount of $61,218.00, and awards attorney fees of $33,669.90.

2)      Multiplier

The court’s objective is to award a fee at the fair market value for the particular action.  (Ketchum, supra, 24 Cal.4th at p. 1132.)  The analysis generally begins with the lodestar figure—i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate.  (Id. at pp. 1131-1132.)  The lodestar is the basic fee for comparable legal services in the community.  (Id. at p. 1132.)  The court may then adjust the lodestar to arrive at the fair market value of the legal services provided.  In adjusting the lodestar, the court considers factors including: (1) the contingent nature of the fee award, (2) the novelty and difficulty of the questions involved, (3) the skill displayed in presenting them, and (4) the extent to which the nature of the litigation precluded other employment by the attorneys.  (Ibid.) 

Plaintiffs request a multiplier of 0.5. (Motion, 12-15.) Specifically, Plaintiff contends that 0.2 of the multiplier is warranted because Plaintiff and his counsel bore substantial risk of not prevailing and suffering a substantial loss of uncompensated fees, and that 0.3 is warranted due to FCA’s “substantial delay in payment.” (Id.)

In opposition, FCA contends that no multiplier is warranted because Plaintiff has failed to demonstrate that the difficulty or complexity of this action warrants a multiplier. (Opposition, 13-14.)

While the court recognizes that Plaintiffs’ counsel was retained under a contingency agreement, the court does not find that Plaintiff has satisfied the second, third, or fourth Ketchum factors. Accordingly, the court denies Plaintiffs’ request for a fee enhancement.

Conclusion

Plaintiffs’ motion is granted in part. Plaintiffs are awarded $33,669.90 in total attorney’s fees. Plaintiffs are to give notice.