Judge: Mel Red Recana, Case: 19STCV07491, Date: 2024-08-19 Tentative Ruling
All rulings shown here are TENTATIVE ONLY, and thus oral argument WILL be heard. All Counsel are still required to attend.
Case Number: 19STCV07491 Hearing Date: August 19, 2024 Dept: 45
Hearing
date: August 19, 2024
Moving
Party: Plaintiff Elva Valdovinos
Responding
Party: Defendant Kia Motors America,
Inc.
Motion
for Attorney Fees
The Court
considered the moving papers, opposition, and reply.
The
motion is GRANTED in part in the amount
of $437,919.25 as to the fees
and DENIED in part as to the $24,261.20
in claimed costs.
Plaintiff must
filed a Memorandum of Costs pursuant to California Rules of Court, rule 3.1700.
Background
This
a Song-Beverly Act (“lemon law”) action filed by plaintiff Elva Valdovinos
(“Plaintiff”) against defendant Kia America, Inc., erroneously sued as,
Kia Motors America, Inc. (“Defendant”), on March 4, 2019. The Complaint alleges
in pertinent part as follows.
On
or about April 13, 2015, plaintiff purchased a 2015 Kia Sedona VIN KNDMC5C12F6045862
(“Vehicle”), manufactured and/or distributed by defendant. (Compl., ¶6.) During the warranty period, the
Vehicle either contained or developed defects that caused plaintiff to suffer
damages in a sum no less than $25,001.00.
(Compl., ¶¶8-9.) Defendant failed to repair and/or replace the Vehicle
or make restitution to plaintiff. (Compl., ¶10.)
On
July 26, 2023, Plaintiff filed a notice of settlement.
On
December 6, 2023, Plaintiff filed the instant motion for attorney’s fees. On
January 11, 2024, Defendant filed an opposition. On July 15, 2024, Plaintiff
filed a reply.
Legal
Standard
A
prevailing buyer in an action under Song-Beverly “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).)
The
prevailing party has the burden of showing that the requested attorney fees
were “reasonably necessary to the conduct of the litigation, and were
reasonable in amount.” (Robertson v. Fleetwood Travel Trailers of California
Inc.¿(2006) 144 Cal.App.4th 785, 817.) The party seeking attorney fees “
‘is not necessarily entitled to compensation for the value of attorney services
according to [his] own notion or to the full extent claimed by [him].’ ” (Levy
v. Toyota Motor Sales, USA, Inc.¿(1992) 4 Cal.App.4th 807,
816.)¿¿Therefore, if the “time expended or the monetary charge being made for
the time expended are not reasonable under all the circumstances, then the
court must take this into account and award attorney fees in a lesser amount.”
(Nightingale v. Hyundai Motor America¿(1994) 31 Cal.App.4th 99, 104.)¿¿
A court may
“reduce a fee award based on its reasonable determination that a routine,
noncomplex 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.)¿¿It is also appropriate to reduce an award based on
inefficient or duplicative efforts. (Id.¿at p. 38.) However, the
analysis must be “reasonably specific” and cannot rely on general notions of
fairness. (Kerkeles¿v. City of San Jose¿(2015) 243 Cal.App.4th
88,¿102.)¿¿Moreover, in conducting the analysis, courts are not permitted to
tie any reductions in the fee award to some proportion of the buyer’s damages
recovery. (Warren v. Kia Motors America, Inc.¿(2018) 30 Cal.App.5th 24,
39.)
Evidentiary
Objections
Defendant Kia America, Inc.’s objections to the
Declaration of Cynthia E. Tobisman are OVERRULED.
Defendant Kia America, Inc.’s
objections to the Declaration of Tionna Carvalho are OVERRULED.
Defendant Kia America, Inc.’s
objections to the Declaration of Dara Tabesh are OVERRULED.
Defendant Kia America, Inc.’s
objections to the Declaration of Payam Shahian are OVERRULED.
Defendant Kia America, Inc.’s objections to the Declaration of Michael H.
Rosenstein are OVERRULED.
Plaintiff’s objections to the Declaration of Corinne D. Orquiola are
OVERRULED.
Request for Judicial Notice
Plaintiff’s
request for judicial notice is GRANTED pursuant to Evidence Code Sections 452,
subdivision (d) and 453. As such, Defendant’s objection to the request is
OVERRULED.
Discussion
Plaintiff
moves for an order awarding attorney fees, costs, and expenses in the total
amount of $483,269.45 consisting of (1) $223,621.50 in attorney fees for
Strategic Legal Practices (“SLP”); (2) $32,220.00 in attorney fees for
California Consumer Attorneys (“CCA”); (3) $17,024.00 in attorney fees for
Ecotech Law Group (“ELG” or “Ecotech”); (4) $30,140.00 in attorney fees for
Greines, Martin, Stein, & Richland, LLP (“GMSR”); (5) a 1.5 multiplier
enhancement on the attorney fees (or $ 151,502.75); (6) $24,261.20 in costs and
expenses for SLP; and (7) at least an additional $4,500.00 for Plaintiffs’
counsel to review Defendant’s opposition, draft the reply, and attend the
hearing on the instant motion.
Entitlement to Attorney’s Fees
Here, Plaintiff is the prevailing party under the terms of the signed
Code of Civil Procedure Section 998 Settlement Offer between the parties and
the Song-Beverly Act. As such, Plaintiff is entitled to attorney’s fees. (See Garcia
v. Mercedes-Benz USA, LLC (2018) 21 Cal.App.5th 1259, 1266-1267 [“the
question of whether a buyer is a prevailing party under the [Song-Beverly
Consumer Warranty] Act looks to what the buyer was last offered by the
manufacturer or retail seller before filing suit and whether she achieved a
greater result by the time of settlement or verdict.”].) Furthermore, Defendant
does not dispute that plaintiff is the prevailing party in this case, rather
defendant contests the reasonableness of the fees sought by plaintiff’s
counsels.
Reasonableness of Attorney’s Fees
a.
Attorney Hourly Rate and Attorney
Hours
Here, four
different firms worked on this case for plaintiff as follows: (1) SLP attorneys
filed the Complaint and handled the discovery, majority of motion practice,
hearings, and other events; (2) Dara Tabesh for Ecotech reviewed and finalized
some of the motions drafted by SLP; (3) CCA was trial counsel and handled
trial-related work; and (4) GMSR worked on prospective sanctions motion and
reply brief. Furthermore, Plaintiff contends that her counsels of record
expended a total of 434.7 hours litigating this action including the instant
motion. The billing invoices and statements submitted by each respected firm
are reasonable given this case was heavily litigated for the past four years
and contained multiple settlement offers that were negotiated before the
subject settlement agreement was entered into by the parties. Although
Defendant contends the number of hours claimed by Plaintiff’s counsels should
be reduced due to block billing, there are very few tasks that are combined to
suggest a pattern of abusive billing practice. (Orquiola Decl., ¶¶6-10, Exs.
A-E.)
As to the hourly
rates claimed by Plaintiff’s counsels of record, the Court finds that some of
them are excessive as described more thoroughly below.
The hourly rates
to be used in computing the lodestar must be “within the range of reasonable
rates charged by and judicially awarded comparable attorneys for comparable
work.” (Children's Hospital &
Medical Center v. Bonta´ (2002) 97 Cal.App.4th 740, 783; PLCM Group,
Inc. v. Drexler (2000) 22 Cal.4th 1084, 1095 (“The reasonable hourly rate is that
prevailing in the community for similar work”).
Particularly where it is difficult to obtain evidence of market based
rates for the same type of work, the courts look at fees charged for cases
requiring similar skills. (The
Utility Reform Network v. Public Utilities Com. (2008) 166 Cal.App.4th 522,
536–537; Prison Legal News v. Schwarzenegger (9th Cir.2010) 608 F.3d
446, 454–455 (“all attorneys in the community engaged in ‘equally complex
Federal litigation,’ no matter the subject matter”).
In
determining the reasonable rate and reasonable hours, the Court looks to that
“prevailing in the community for similar work.”
(PLCM Group, Inc., supra, 22 Cal.4th at 1095; Ketchum,
supra, 24 Cal.4th at 1132 (“the lodestar is the basic fee for comparable
legal services in the community”). “A
reasonable trial court might determine that the ‘similar work’ or ‘comparable
legal services’ related to insurance defense litigation, rather than to civil
litigation in general. Were the court to so conclude, it could view the
relevant ‘market’ to be that of insurance defense litigation and litigators,
rather than general civil litigation. The “market rate” for such services might
be limited accordingly. Again, we emphasize that such determinations lie within
the broad discretion of the trial court.”
(Syers Properties III, Inc. v. Rankin (2014) 226 Cal.App.4th 691,
702–703.)
The
burden is on the fee applicant to produce evidence that the requested rates are
in line with those prevailing in the community for similar work. (ComputerXpress, Inc. v. Jackson
(2001) 93 Cal.App.4th 993, 1019.)
“Affidavits of the plaintiffs' attorney and other attorneys regarding
prevailing fees in the community, and rate determinations in other cases,
particularly those setting a rate for the plaintiffs' attorney, are
satisfactory evidence of the prevailing market rate.” (Heritage Pacific Financial, LLC v. Monroy
(2013) 215 Cal.App.4th 972, 1009.)
The
trial court is not required to adopt counsel’s opinion as to the “market rate”
for services of the type performed. (Syers
Properties III, supra, 226 Cal.App.4th at 702.) The trial court may accept the actual rate
charged as the reasonable rate. (Id.)
First, Attorney
Shahian attests that sixteen attorneys at SLP’s who performed work on this case
at hourly rates of $335, $360, $375,
$385, $395, $400, $410, $425, $435, $445, $450, $465, $490, $495, $570, $595,
$610, $620, and $625. (Shahian Decl., ¶¶45-76.) Although Shahian testifies as
to his extensive experiences in handling Song-Beverly cases, he does not seek
recovery for his time supervising this matter. (Id. at ¶44.) The
experience and background of the remaining attorneys is set forth in Shahian’s declaration.
(Id. at ¶¶45-76.) Upon review of the attorneys’ background information
and market rates charged for similar services based on the Court’s own
experience, the hourly rates charged above $575 are excessive. Those hours
billed at $595, $610, $620, and $625 are recalculated at the hourly rate of
$575.
·
Lunn. 18.30 hours @ $620 for a
total of $11,346.00, reduced to $10,522.50, for total reduction of $823.50;
·
McCallister. 2.80 hours @ $595 for
a total of $1,666.00, reduced to $1,610.00, for total reduction of $56.00;
·
Tomas. 2.50 hours @ $610 for a
total of $1,525.00, reduced to $1,437.50, for total reduction of $87.50;
·
Yu. 7.50 hours @ $595 for a total
of $4,462.50, reduced to $4,312.50, for total reduction of $150.00; and
·
Yu. 139.20 hours @ $625 for a total
of $87,000.00, reduced to $80,040.00, for total reduction of $6,960.00.
In total, the
requested fee award is reduced by $8,077.00 for excessive hourly rates claimed
by four of the sixteen SLP attorneys. This leaves a balance of $442,854.25 ($450,931.25
- $8,077.00).
Next, Attorney
Rosenstein attests that three CCA attorneys including himself, performed work on
this case at hourly rates of $355, $500, and $650. (Rosenstein Decl., ¶¶3-5.)
Attorney Rosenstein also attests to the background and experience of himself
and the other two attorneys in his
declaration. (Id.) As discussed above, the hourly rates charged above
$575 are excessive. Attorney Rosenstein’s 8.6 hours billed at $650 are
recalculated at the hourly rate of $575 for a reduction from $5,590.00 to
$4,945.00, a total reduction of $645.00. Applying this further to reduction to
the balance of $442,854.25, yields an attorney’s fees total of $442,209.25.
Similarly,
Attorney Tobisman attests that three GSMR attorneys including herself,
performed work on this case at hourly rates of $400, $750, and $850. (Tobisman
Decl., ¶¶3-6, 9,13, Exs. D-F.) Attorney Tobisman further attests to the
background and experience of herself and the other two attorneys. (Id.)
As previously discussed, the hourly rates charged above $575 are excessive,
thus the hours billed at $750 and $850 rates are recalculated at the hourly
rate of $575 as follows:
·
Tobisman. 1.6 hours @ $850 for a
total of $1,360.00, reduced to $920, for
a total reduction of $440.00; and
·
Bui. 22.0 hours @ $750 for a total
of $16,500.00, reduced to $12,650.00, for a total reduction of $3,850.00
Applying the
total reduction of $4,290 to the balance of the attorney’s fees, the attorney’s
fees is now for $437,919.25.
b.
Lodestar Multiplier
Here, Plaintiff
argues that her counsels of record obtained an excellent outcome after four
years of litigation. Specifically, Plaintiff’s counsels obtained a settlement
offer of $96,000.00 after refusing earlier 998 offers for $20,000.00 and
$50,000.00, respectively. Furthermore, Plaintiff contends SLP and co-counsel
took on this case on a continency basis, thus if she lost, they would not
receive any compensation. (Shahian Decl., ¶82.)
The lodestar
figure may be adjusted based on relevant factors, which 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.) However, “a trial court should award a
multiplier for exceptional representation only when the quality of
representation far exceeds the quality of representation that would have been
provided by an attorney of comparable skill and experience billing at the
hourly rate used in the lodestar calculation.” (Id. at 1139.) As such, “it
is appropriate for a trial court to reduce a fee award based on its reasonable
determination that a routine, noncomplex case was over staffed to a degree that
significant inefficiencies and inflated fees resulted.” (Morris v. Hyundai
Motor America (2019) 41 Cal.App.5th 24, 39.)
The Court finds
that a lodestar multiplier is not appropriate in this case. Although Plaintiff’s
counsels’ took this case on a purely contingency basis, with 4 law firms
and their 17 lawyers, one can reasonably infer that they did not give up
work to handle this case greatly reducing the risk of non-payment. (Mot., at
14:11-14.) Moreover, there is no indication that Plaintiff’s counsels advance
litigation costs such that a 1.5 multiplier would be warranted. Thus, the
requested 1.5 multiplier will not be applied to the balance of the attorney’s
fees.
Costs
“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.)¿
To recover a
cost, 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.)¿¿¿
Here,
Plaintiff’s counsels seek $24,261.20 in costs and expenses. However,
Plaintiff’s counsels failed to file a Memorandum of Costs as required under California
Rules of Court, rule 3.1700. Submission of a Memorandum of Costs would organize
the requested costs into categories under Code of Civil Procedure section
1033.5. A Memorandum of Costs would also
trigger Defendant’s right to tax those costs by noticed motion, with an
opportunity to reply to any opposition.
Therefore, the
Motion for Attorney’s Fees is GRANTED in part as to the fees in the amount of $437,919.25
and DENIED in part as to the $24,261.20 in costs.
Plaintiff must
filed a Memorandum of Costs pursuant to California Rules of Court, rule 3.1700.
It
is so ordered.
Dated: August 19, 2024
_______________________
MEL RED RECANA
Judge of the
Superior Court