Judge: Loren G. Freestone, Case: 37-2022-00015976-CU-BC-CTL, Date: 2024-06-21 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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HALL OF JUSTICE

TENTATIVE RULINGS - June 20, 2024

06/21/2024  10:30:00 AM  C-64 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Loren G. Freestone

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Civil - Unlimited  Breach of Contract/Warranty Motion Hearing (Civil) 37-2022-00015976-CU-BC-CTL EGAN VS KIA AMERICA INC [IMAGED] CAUSAL DOCUMENT/DATE FILED:

TENTATIVE RULING Plaintiff Katherine Egan's motion for attorney fees, costs, and expenses is GRANTED as set forth below.

Preliminary Matters Egan's request for judicial notice of prior court orders awarding attorney fees is granted. (See Goglin v. BMW of North America, LLC (2016) 4 Cal.App.5th 462, 473 [finding prior fee awards in various state and federal courts helped support requested hourly rates].) Egan's evidentiary objection to the Declaration of Stephen Grimsrud is overruled.

Analysis – Attorney Fees Egan moves for $20,047.50 in attorney fees through the filing of the fee motion, plus an additional $3,500 to prepare a reply and attend the hearing on this motion.

A prevailing buyer in an action under the Song-Beverly Consumer Warrant 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, subd. (d).) Egan accepted Kia's Code of Civil Procedure section 998 offer for $63,000. The offer stated that Kia would also 'pay reasonable costs, expenses, and attorneys' fees based on actual time expended pursuant to Civil Code Section 1794(d) as stipulated by the parties or, if the parties cannot agree, upon motion to the Court having jurisdiction over this action.' Egan is therefore entitled to her fees. The only issue is the amount of fees.

'In determining the methodology to be used to award attorney fees under the Song-Beverly Act, the appellate courts have unanimously concluded the lodestar adjustment method of calculating attorney fees is appropriate. . . . A trial court assessing attorney fees using the lodestar adjustment method begins with a touchstone or lodestar figure, based on the careful compilation of the time spent and reasonable hourly compensation for each attorney involved in the presentation of the case.' (Reynolds v. Ford Motor Co. (2020) 47 Cal.App.5th 1105, 1112.) Calendar No.: Event ID:  TENTATIVE RULINGS

3085615  39 CASE NUMBER: CASE TITLE:  EGAN VS KIA AMERICA INC [IMAGED]  37-2022-00015976-CU-BC-CTL 'The prevailing party and fee applicant bears the burden of showing that the fees incurred were reasonably necessary to the conduct of the litigation, and were reasonable in amount.' (Mikhaeilpoor v. BMW of North America, LLC (2020) 48 Cal.App.5th 240, 247.) However, in opposing the motion, 'general arguments that fees claimed are excessive, duplicative, or unrelated do not suffice.' (Etcheson v. FCA US LLC (2018) 30 Cal.App.5th 831, 848.) Reasonable Number of Hours Egan requests a total of 40.8 hours, not counting time spent preparing the reply and attending the hearing. Billing records were submitted substantiating this time. (See Pulliam v. HNL Automotive Inc.

(2021) 60 Cal.App.5th 396, 407, affd. (2022) 13 Cal.5th 127 [detailed invoice was substantial evidence supporting fee award].) Kia argues that 'fees incurred by Plaintiff in pursuit of her claim for fraudulent inducement – concealment are not compensable under Civil Code §1794(d).' However, 'apportionment is not required when the claims for relief are so intertwined that it would be impracticable, if not impossible, to separate the attorney's time into compensable and noncompensable units.' (Santana v. FCA US, LLC (2020) 56 Cal.App.5th 334, 349.) Claims for fraud and violation of Song-Beverly often encompass 'one set of facts.' (Ibid.; accord Drouin v. Fleetwood Enterprises (1985) 163 Cal.App.3d 486, 493.) Kia does not identify any time that related exclusively to the fraud claim. As such, no deduction is warranted on this ground.

Kia argues that Egan should not be allowed to recover time spent unsuccessfully opposing its motion to compel responses to its requests for production, and time spent preparing the responses that were compelled. 'There is no requirement that each motion or opposition be successful to be reasonable. . . .

Compensation is ordinarily warranted even for unsuccessful forays.' (City of Los Angeles v. Metropolitan Water Dist. of Southern California (2019) 42 Cal.App.5th 290, 307.) However, a prevailing party may be denied fees for time that is 'not reasonably spent' or when there is evidence of 'bad faith.' (See City of Sacramento v. Drew (1989) 207 Cal.App.3d 1287, 1303.) Here, the court previously found that Egan's opposition to Kia's motion 'was not well-grounded in law' and 'was also not well-grounded in fact.' (ROA #28.) Although sanctions were ultimately waived, it would be anomalous to now compensate Egan for such conduct. As such, the court deducts 4.5 hours for time spent related to opposing the motion to compel.

There are also discrepancies in the record with respect to the discovery responses that warrant a further reduction. In support of this motion, counsel for Egan (Tionna Carvalho) declares that on 'October 4, 2022, Plaintiff served Responses to Defendant's Requests for Production of Documents Set One.' (ROA #61.) Yet it was the failure to serve those responses that precipitated the motion to compel.

Indeed, in opposing the motion to compel, Egan did not dispute that responses were never served.

Rather, Egan argued that the failure to timely serve responses was the result of mistake, inadvertence, or excusable neglect. Counsel for Egan (Mani Arabi) declared that on 'October 04, 2022, the law clerk assigned to prepare the responses completed drafts and prepared the document production,' but due to various issues, they were never served. Attorney Arabi further declared that he 'finalized the responses and document production, and served them both,' on February 17, 2023-the same day Egan's opposition to the motion to compel was filed. (ROA #22.) Only one law clerk billed on this matter (Duarte Valentino), and the billing records submitted with this motion indicate that he did not prepare responses on October 4, 2022 or on any other day. Nor do the billing records indicate that any other biller prepared responses on October 4, 2022. Nor do the billing records indicate that Attorney Arabi finalized the responses/document production and served them on February 17, 2023. The first billing entry related to Egan's responses to Kia's request for production is from February 23, 2023 and states: 'Draft and finalize P's responses to D's RFPs; compile and redact P's document production.' (ROA #62, Ex. 18.) This is consistent with Kia's reply in support of its motion, wherein its counsel declared that responses were not received until the evening of February 23, 2023. (ROA #23.) The reasonable Calendar No.: Event ID:  TENTATIVE RULINGS

3085615  39 CASE NUMBER: CASE TITLE:  EGAN VS KIA AMERICA INC [IMAGED]  37-2022-00015976-CU-BC-CTL inferences from these facts are that responses were either already prepared or Egan misrepresented that they were already prepared. Either way, Egan should not be awarded time spent after the motion to compel was granted to prepare the responses. The court therefore deducts 2.7 hours for such work.

Kia argues that fees should be reduced because this case was overstaffed. Staffing 'too many cooks in the kitchen' can lead to 'inefficiencies and inflated fees,' and therefore warrant a deduction. (See Morris v. Hyundai Motor America (2019) 41 Cal.App.5th 24, 38–39.) Here, a total of 10 individuals billed on this matter. However, 4 individuals billed over 70% of the work. Moreover, Kia does not identify any specific instances of inefficiencies caused by the staffing. Different attorneys appear to have performed discrete tasks that did not necessarily require them to first spend a significant amount of time familiarizing themselves with the details of the case. Notwithstanding the staffing, fees were overall relatively low.

No deduction is warranted based on the staffing.

Finally, Kia argues that fees spent related to the preparation of this fee motion were excessive. Kia argues that its 998 offer contemplated the parties attempting to negotiate fees before briefing the issue for the court. Counsel for Kia declares that counsel for Egan never attempted to contact them 'regarding the resolution of attorney's fees in this case.' Yet counsel for Kia does not declare that he ever attempted to contact counsel for Egan to discuss the issue. In other words, neither side made any effort to resolve the issue for the five months between the date the 998 offer was accepted (September 12, 2023) until the date the fee motion was filed (February 8, 2024). Whether the parties would have been able to informally resolve the issue, and in what amount, is speculative. As such, no reduction is warranted on that basis.

However, 7.2 hours to prepare the moving papers for this fee motion is excessive. Egan's evidence indicates that her attorneys regularly file similar motions. As such, the motion 'should not have required anything more than a slight factual modification to an existing boilerplate.' (Mikhaeilpoor, supra, 48 Cal.App.5th at p. 250.) The court therefore deducts 3.2 hours for time spent preparing the fee motion.

The court therefore finds 30.4 hours is reasonable for work through the filing of the fee motion.

Reasonable Hourly Rate 'In making its calculation of a reasonable hourly rate, the court may rely on its own knowledge and familiarity with the legal market, as well as the experience, skill, and reputation of the attorney requesting fees, the difficulty or complexity of the litigation to which that skill was applied, and affidavits from other attorneys regarding prevailing fees in the community and rate determinations in other cases.' (Morris, supra, 41 Cal.Ap.5th at p. 41.) A court may, in appropriate circumstances, utilize a blended rate. (See 569 East County Boulevard LLC v. Backcountry Against the Dump, Inc. (2016) 6 Cal.App.5th 426, 439, fn. 16; see, e.g., Mikhaeilpoor, supra, 48 Cal.App.5th 240 [affirming blended rate of $350 in lemon law case].) Egan requests hourly rates between $375/hour and $595/hour for attorneys who were admitted between 2003 and 2022, and $285/hour for a law clerk. Four attorneys (Arabi, Baker, Weiser, and Randolph) billed over 70% of the hours claimed. The four primary billers billed at $450–$495/hour, $595/hour, $525/hour, and $375 were admitted between and 2003 and 2021. The motion seeks a blended rate of approximately $490/hour.

Egan submit a myriad of prior state and federal court orders awarding her law firm (SLP) rates similar to those requested in this motion. However, the vast majority of those orders are not from San Diego County Superior Court or the Southern District of California. Kia likewise relies on a court of appeal opinion from the Second District Court of Appeal affirming a fee award in a case originating out of Los Angeles Superior Court. Rates awarded in other counties or other federal districts are not persuasive because the relevant market is San Diego and there was no showing that Egan was unable to retain local counsel. (See Reynolds, supra, 47 Cal.App.5th at pp. 1113–1114.) Calendar No.: Event ID:  TENTATIVE RULINGS

3085615  39 CASE NUMBER: CASE TITLE:  EGAN VS KIA AMERICA INC [IMAGED]  37-2022-00015976-CU-BC-CTL Only two orders come were from the Southern District of California and only one order was from the Superior Court of San Diego County. In one case, Judge Miller awarded SLP rates ranging from $350/hour to $550/hour. In another case, Judge Miller awarded a different local lemon law firm rates ranging from $365/hour to $575/hour. In the third case, Judge Whitney awarded SLP rates ranging from $325/hour to $495/hour.

The Court is knowledgeable and familiar with rates charged by San Diego attorneys for lemon law work.

The Court has also considered, among other things, the experience of the various billing attorneys, the relative difficulty of this case, the prior fee awards from the San Diego market, and the relative time billed by each attorney and the level of skill required for each task performed.

The Court finds a blended rate of $425/hour reasonable and appropriate in this case.

A reasonable amount of fees up through the filing of the fee motion is therefore $12,920 (30.4 * 425).

Kia has not specifically challenged Egan's request for an additional $3,500 to review its opposition, prepare a reply, and appear at the hearing. Egan also submits evidence that her attorneys spent 10.4 hours preparing the reply, which at the approved blended rate of $395/hour exceeds the amount requested. The court therefore awards $3,500 for the reply and anticipated appearance at the hearing.

The court therefore sets the lodestar at $16,420.

Analysis - Multiplier Egan requests a 1.35 multiplier on her lodestar based on the 'excellent outcome,' the fact her attorneys took the case on a contingency basis with the risk of non-payment, and the two-year delay in payment.

Whether to apply a fee enhancement to the basic lodestar figure rests in the trial court's discretion, and the burden is on the party seeking a multiplier. (See Ketchum v. Moses (2001) 24 Cal.4th 1122, 1138.) Egan obtained a good result, but this was not a complex case. This appears to be an ordinary lemon law case where the core issue was whether Egan's 2015 Kia Soul had a substantial defect that was not repaired within a reasonable number of repair attempts. The parties exchanged only limited discovery.

Although Kia filed a motion for summary judgment, it was never heard because the matter settled.

There were no other substantive motions. (See Mikhaeilpoor, supra, 48 Cal.App.5th at pp. 247–248, 254–255 [affirming denial of multiplier in lemon law action where it was 'not a complicated case' involving simple discovery and 'modest litigation efforts'].) Moreover, consumers rarely, if ever, pay lemon law attorneys on an hourly basis as the case progresses. Rather, risk of nonpayment and delay in payment are factors present in virtually all cases filed under Song-Beverly and are essentially baked into the base hourly rates requested by/awarded to lemon law attorneys at the time of the fee motion. Egan presents no evidence that the requested hourly rates fail to account for contingency risk and delay in payment. Awarding a multiplier based on these factors on the ground it would therefore amount to 'unfair double counting.' (See Robertson v. Fleetwood Travel Trailers of California, Inc. (2006) 144 Cal.App.4th 785, 822].) The Court therefore declines to award a multiplier. At the same time, the court denies Kia's request for a negative multiplier.

Analysis - Costs Egan requests $1,718.83 in costs and expenses.

The types of costs recoverable under Song-Beverly are broader than those recoverable under Code of Civil Procedure section 1033.5. (See Warren v. Kia Motors America, Inc. (2018) 30 Cal.App.5th 24, Calendar No.: Event ID:  TENTATIVE RULINGS

3085615  39 CASE NUMBER: CASE TITLE:  EGAN VS KIA AMERICA INC [IMAGED]  37-2022-00015976-CU-BC-CTL 42–43.) Egan submitted billing records identifying all costs and expenses incurred.

Kia does not argue that any particular cost is unrecoverable. Rather, Kia argues that no costs should be awarded because Egan claimed them in her motion rather than by way of a memorandum of costs.

Costs generally must be claimed in a verified memorandum of costs on the Judicial Council form. (See Code Civ. Proc., § 1034; Cal. Rules of Court, rule 3.1700(a)(1).) However, the parties can stipulate to an alternate procedure. (See Code Civ. Proc., § 1032, subd. (c); Gorman v. Tassajara Dev. Corp.

(2009) 178 Cal.App.4th 44, 69–70.) Here, as noted above, Kia offered to 'pay reasonable costs . . . upon motion to the Court.' As such, Egan appropriately requested costs in her motion.

The court therefore awards $1,718.83 in costs and expenses.

Conclusion The motion is granted. Egan is awarded a total of $16,420 in attorney fees and $1,718.83 in costs and expenses.

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