Judge: Theresa M. Traber, Case: 21STCV36799, Date: 2023-04-14 Tentative Ruling

Case Number: 21STCV36799    Hearing Date: April 14, 2023    Dept: 47

Tentative Ruling

 

Judge Theresa M. Traber, Department 47

 

 

HEARING DATE:     April 14, 2023                                   TRIAL DATE: N/A

                                                          

CASE:                         Lilik Khachatryan, et al v. FCA US LLC, et al.

 

CASE NO.:                 21STCV36799

 

           

 

MOTION FOR ATTORNEY’S FEES, COSTS, AND EXPENSES

 

MOVING PARTY:               Plaintiffs Lilik Khachatryan and Leana Vadannyan

 

RESPONDING PARTY(S): Defendant FCA US LLC

 

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

                       

In their October 6, 2021, Plaintiffs Lilik Khachatryan and Leana Vadannyan (“Plaintiffs”) allege that the vehicle leased contained various defects pertaining to the vehicle’s engine and electrical system. It is further alleged that Defendant failed to repair the vehicle to conform to warranties after a reasonable number of opportunities and refused to accept Plaintiffs’ demand for revocation.

 

Pursuant to the settlement agreement on January 11, 2023, Plaintiffs now move for an order granting their requests attorney’s fees, costs, and expenses. Defendant opposes.

 

TENTATIVE RULING:

 

            Plaintiffs’ motion for attorney’s fees, costs and expenses is GRANTED in part in the reduced amount of $68,137.50. The request for a fee multiplier of 1.5 is DENIED. Costs are awarded in the amount of $4,318.42, with payment due within 30 days of notice of this order.

 

DISCUSSION:

 

Motion for Attorney’s Fees

 

Defendant’s Evidentiary Objections

           

                        Declaration of Hovanes Margarian

 

No. 1: OVERRULED.

Analysis

 

            Plaintiffs seek a total attorney fee award of $114,665.92, consisting of $73,565.50 in attorney’s fees, a 1.50 multiplier enhancement ($36,782.50) on attorney’s fees, and $4,318.42 in costs and expenses. (See Notice of Motion at pg. 2.) Additionally, Plaintiffs request that the Court set a 30-day deadline for Defendant to pay Plaintiffs’ attorney fees and costs. (Ibid.)

 

            Civil Code § 1794(d) provides:

 

(d) If the buyer prevails in an action under this section, the buyer 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.

(Bold emphasis added.)

 

            As a preliminary matter, it is undisputed that Plaintiffs are prevailing buyers under Civil Code § 1794(d). Thus, the issues before the Court are whether: (1) Plaintiffs’ request for attorney fees is reasonable based on the hourly rate and the hours worked; (2) Plaintiffs are entitled to a fee multiplier; and (3) their costs are reasonable. The Court shall address each in turn.

 

i.                    Whether Plaintiffs’ Request for Attorney Fees is Reasonable

 

Plaintiff contends that his requested lodestar fee award of $73,565.50, consisting of 83.35 hours at a legal rate of $650 per hour and 32.25 hours at a legal rate of $550 per hour, is reasonable. (Motion at pg. 10, 12-15.)

 

The determination of reasonable amount of attorney fees is within the sound discretion of trial courts.  (PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1095; Akins v. Enterprise Rent-A-Car Co. (2000) 79 Cal. App. 4th 1127, 1134.)  “The determination of what constitutes a reasonable fee generally ‘begins with the ‘lodestar,’ i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate….’”  “[T]he lodestar is the basic fee for comparable legal services in the community; it may be adjusted by the court based on factors including, as relevant herein, (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, (4) the contingent nature of the fee award….”  (Graciano v. Robinson Ford Sales, Inc. (2006) 144 Cal.App.4th 140, 154.)  In setting the hourly rate for an attorney fees award, courts are entitled to consider the rate of “‘fees customarily charged by that attorney and others in the community for similar work.’” (Bihun v. AT&T Information Systems, Inc. (1993) 13 Cal. App. 4th 976, 997 [affirming rate of $450 per hour], overruled on other grounds by Lakin v. Watkins Associated Indus. (1993) 6 Cal. 4th 644, 664.)  The burden is on the party seeking attorney fees to prove reasonableness of the fees.  (Center for Biological Diversity v. County of San Bernardino (2010) 188 Cal. App. 4th 603, 615.)

 

The Court has broad discretion in determining the amount of a reasonable attorney's fee award which will not be overturned absent a “manifest abuse of discretion, a prejudicial error of law, or necessary findings not supported by substantial evidence.” (Bernardi v. County of Monterey (2008) 167 Cal. App. 4th 1379, 1393-94.)  The Court need not explain its calculation of the amount of attorney’s fees awarded in detail; identifying the factors considered in arriving at the amount will suffice. (Ventura v. ABM Industries Inc. (2012) 212 Cal.App.4th 258, 274-275.)

 

First, the Court finds that the hourly rates of $550/hour for Counsel Armen Margarian and $650/hour for Counsel Hovanes Margarian are reasonable in the community.  (See Hovanes Margarian Decl., ¶¶ 13-18; see also Armen Margarian Decl., ¶¶18-20.)  In opposition, Defendant argues that the Court should adopt the rate caps prescribed in the 2021 Real Rate Report for Consumer Good Litigation, which would be $443/hour for partners and $308/hour for associates. (Opposition at pg. 3; Hanson Decl. ¶ 3, Exh. A.) However, this report is not instructive because it fails to specify the geographical region, and as a result, it does not reflect what is reasonable in the community.

 

Second, in terms of the reasonableness of the hours worked. The Court finds that some reduction is warranted because some of the billing entries are unreasonable or vague. For instance, while Plaintiffs are entitled to recover attorney fees for hours spent on pre-litigation tasks under Civil Code § 1794(d), the Court finds that the billing entries associated with clerical tasks are not recoverable because it is unreasonable for Plaintiffs to seek recovery for hours spent on administerial tasks at a high level of compensation. (See Keith v. Volpe (C.D. Cal. 1986) 644 F.Supp. 1312, 1323.) Therefore, 2.1 hours at a rate of $650 (i.e. $1,365) are subtracted from the total.

 

There are also instances of duplicative billing. With regard to the vehicle inspection, Counsel Hovanes Margarian first spent 3.5 hours on June 22, 2021, and he then spent 4.5 hours in a second inspection with their retained expert on December 20, 2021. (Hovanes Margarian Decl., Exh. A at pp. 1, 3.) The later inspection was an excessive use of the counsel’s time when the expert could have easily prepared a report for counsel’s review. Thus, 4.5 hours at a rate $650 (i.e. $2,925.) are deducted from the total. Further, both attorneys are reported to have participated in the mediation that was held telephonically on October 25, 2022. Based on the prior billing entries, Counsel Armen Margarian devoted his time preparing for this mediation. (Hovanes Margarian Decl., Exh. A at pg. 5.) Thus, the time expended by Counsel Hovanes Margarian was duplicative. As a result, the total is reduced by another 1.75 hours at a rate of $650 (i.e. $1,137.50).

 

            The Court takes note of the relative absence of law and motion work involved, and the fact that the issues involved in this case were applicable to other consumers’ vehicles, thereby triggering economies of scale in terms of Plaintiffs’ counsel’s efficiency in litigating this lemon law case.  The Court acknowledges, however, that Plaintiffs’ counsel prepared some discovery, and despite Defendant’s assertions that these billing entries were excessive, the Court disagrees because they were reasonably incurred in connection with the prosecution of this case. (See Civil Code § 1794(d).)  

 

            Moreover, the Court does not find Defendant’s block-billing argument persuasive. “Block billing is not objectionable ‘per se,’ though it certainly does increase the risk that the trial court, in a reasonable exercise of its discretion, will discount a fee request. Block billing is particularly problematic in cases where there is a need to separate out work that qualifies for compensation…from work that does not. (Jaramillo v. County of Orange (2011) 200 Cal.App.4th 811, 830 [citations omitted].)     The tasks identified by Defendant include descriptions that sufficiently apprises the Court of what occurred. Therefore, in this instance, the usage of block-billing is not objectionable because the entries are not vague.

 

Regarding the hours spent on the instant motion and the anticipated reply, the Court does not find that these hours here were excessive or unreasonable. Considering that Plaintiffs filed the corresponding motion for fees and the reply, these hours are recoverable. (Ibid.)  

 

            In light of the foregoing, the Court reduces the total lodestar amount of attorney’s fees from $73,565.00 to $68,137.50, which includes the fees incurred in connection with bringing the instant motion. 

 

ii.                  Whether Plaintiffs Should be Awarded a Lodestar Multiplier of 1.5

 

Next, Plaintiffs seeks a lodestar multiplier of 1.5 (i.e. $36,782.50). (Motion at pp. 15-18.)

 

While the lodestar reflects the basic fee for comparable legal services in the community, it may be adjusted based on various factors, including “(1) the novelty and difficulty of the questions involved, and the skill displayed in presenting them; (2) the extent to which the nature of the litigation precluded other employment by the attorneys; (3) the contingent nature of the fee award” and (4) the success achieved. (Serrano v. Priest (1977) 20 Cal.3d 25, 49.) The burden of proof to support such a multiplier is on the prevailing party. (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1138.)

 

Nonetheless, the court must not consider extraordinary skill and the other Serrano factors to the extent these are already included with the lodestar. (Id. at 1138-1139.) “[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. Otherwise, the fee award will result in unfair double counting and be unreasonable.” (Id. at 1139.) 

 

Plaintiff asserts that a 1.5 lodestar multiplier is warranted based on the complex issues in this case, the excellent outcome achieved, and the contingency risk involved. (Motion at pp. 15-17.)

 

Given the routine work done in this case and the results obtained in this lemon law area, a multiplier is not appropriate. Any contingency risk factor is already accounted for in the hourly rates. There is no shortage of experienced counsel litigating in this area of the law at these hourly rates. 

 

Accordingly, the Court finds that applying a multiplier is not appropriate in this case. Additionally, the Court declines to apply a negative multiplier as Defendant suggest doing.

 

iii.                Whether Plaintiff’s Costs are Reasonable

 

            Plaintiff seeks to recover $4,318.42 in costs and expenses that were incurred in this litigation. (Motion at pg. 18; see also Memorandum of Costs.) Plaintiffs assert that they had to incur an expert witness fee because there was no guarantee of a settlement. (Ibid.)

 

            Defendant opposes Plaintiff’s claimed $3,001 expense for expert fees because there was no showing that Section 998 offer was made and that it is not reasonable. (Opposition at pg. 9.) This is not persuasive because, under Civil Code section 1794, expert witness fees costs are recoverable. (Jensen v. BMW of North America, LLC (1995) 35 Cal. App. 4th 112, 138.)

 

            Accordingly, Plaintiffs are entitled to recover costs in the amount of $4,318.42

 

            Conclusion

 

Plaintiffs’ motion for attorney’s fees, costs and expenses is GRANTED in part in the reduced amount of $68,137.50. The request for a fee multiplier of 1.5 is DENIED. Costs are awarded in the amount of $4,318.42.

 

            Defendant is ordered to tender payment within 30 days of notice of this order.

 

            Moving Party to give notice, unless waived.

 

IT IS SO ORDERED.

 

Dated:   April 14, 2023                                               ___________________________________

                                                                                    Theresa M. Traber

                                                                                    Judge of the Superior Court

 


            Any party may submit on the tentative ruling by contacting the courtroom via email at  Smcdept47@lacourt.org by no later than 4:00 p.m. the day before the hearing.  All interested parties must be copied on the email.  It should be noted that if you submit on a tentative ruling the court will still conduct a hearing if any party appears. By submitting on the tentative you have, in essence, waived your right to be present at the hearing, and you should be aware that the court may not adopt the tentative, and may issue an order which modifies the tentative ruling in whole or in part.