Judge: Upinder S. Kalra, Case: 20STCV33853, Date: 2023-04-06 Tentative Ruling

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Case Number: 20STCV33853    Hearing Date: April 6, 2023    Dept: 51

Tentative Ruling

Judge Upinder S. Kalra, Department 51

HEARING DATE:   April 6, 2023

CASE NAME:           Abel Castaneda, et al. v. General Motors, LLC

CASE NO.:                20STCV33853

MOTION FOR ATTORNEYS’ FEES

MOVING PARTY: Plaintiffs Abel Castaneda and Violeta Cobos

RESPONDING PARTY(S): Defendant General Motors, LLC

REQUESTED RELIEF:

1.      An order awarding Plaintiffs attorneys’ fees, costs and expenses. 

TENTATIVE RULING:

Motion for Attorneys’ Fees is GRANTED, totaling $55,879.77.  

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

On September 4, 2020, Plaintiffs Abel Castaneda and Violeta Cobos (“Plaintiffs”) filed a complaint against General Motors, LLC (“Defendant.”) The complaint alleges 3 causes of action: (1) Breach of Implied Warranty of Merchantability under the Song-Beverly Warranty Act, (2) Breach of Express Warranty under the Song-Beverly Warranty Act, and (3) Fraudulent Inducement - Concealment. The complaint alleges that Plaintiffs purchased the Subject Vehicle, which was manufactured by Defendant. With that purchase, Plaintiff received various written warranties. During that warranty, the car suffered nonconformities, and each time Plaintiffs brought the vehicle to be repaired, Defendant failed to satisfactorily repair the defects to conform with the written warranties. The Defendant failed to repair the Subject vehicle and failed to provide restitution.

On November 12, 2020, Defendant filed a Demurrer with Motion to Strike.

On January 21, 2021, Plaintiff filed a First Amended Complaint.

On February 22, 2021, Defendant filed a Demurrer with Motion to Strike, which was SUSTAINED, with leave to amend.

On June 15, 2021, Plaintiff filed a Second Amended Complaint.

On August 18, 2021, Defendant filed a Demurrer with Motion to Strike, which was OVERRULED, and DENIED.

On February 15, 2022, Defendant filed an Answer.

The current Motion for Attorney’s Fees was filed on February 1, 2023. Defendant’s Opposition was filed on March 22, 2023. Plaintiff’s Reply was filed on March 29, 2023.

On March 27, 2023, Defendant filed a Motion to Strike Plaintiff’s Memorandum of Costs.

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(d).) By permitting buyers who prevail under Song-Beverly to recover their attorneys’ fees, “our Legislature has provided injured consumers strong encouragement to seek legal redress in a situation in which a lawsuit might not otherwise have been economically feasible.” (Murillo v. Fleetwood Enterprises, Inc. (1998) 17 Cal.4th 985, 994.) 

The prevailing party has the burden of showing that the requested attorney fees are reasonable. (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 the compensation of the value of attorney services according to [his or her] own notion or to the full extent claimed . . . .”  (Levy v. Toyota Motor Sales, USA, Inc. (1992) 4 Cal.App.4th 807, 816.) If the “time expended or the monetary charge being made for the time expended are not reasonable under all circumstances, then the court must take this into account and award fees in a lesser amount.” (Nightingale v. Hyundai Motor America (1994) 31 Cal.App.4th 99, 104.) 

A calculation of attorneys’ fees for a Song-Beverly action begins with the “lodestar” approach, under which the Court fixes the lodestar at “the number of hours reasonably expended multiplied by the reasonable hourly rate.” (Margolin v. Regional Planning Com. (1982) 134 Cal.App.3d 999, 1004-1005.) “California courts have consistently held that a computation of time spent on a case and the reasonable value of that time is fundamental to a determination of an appropriate attorneys’ fee award.” (Ibid.)

“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.) It is also appropriate to reduce a fee award based on “inefficient or duplicative efforts” in the billing record. (Id. at p. 38.) However, the analysis must be “reasonably specific” and cannot rely on general notions about the fairness of the fee award. (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.) 

The lodestar figure may also 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. (Serrano v. Priest (1977) 20 Cal.3d 25, 49; PLCM Group, Inc. v. Drexler (2000) 22 Cal.App.4th 1084, 1095.) The factors considered in determining the modification of the lodestar include the nature and difficulty of the litigation, the amount of money involved, the skill required and employed to handle the case, the attention given, the success or failure, and other circumstances in the case. (EnPalm, LLC v. Teitler Family Trust (2008) 162 Cal. App. 4th 770, 774 (emphasis in original).) A negative modifier was appropriate when duplicative work had been performed. (Thayer v. Wells Fargo Bank, N.A. (2001) 92 Cal.App.4th 819.) 

ANALYSIS:

Plaintiffs move for attorneys’ fees totaling $71,954.71, which is based on $65,261.50 in fees and the costs and expenses of $6,693.21.

Prevailing Party

After two years of litigation, Defendant submitted settlement agreement totaling $109,000.00, which included $69,000.00 in civil penalties. Under the agreement, Plaintiffs are the prevailing party, and thus, fees and costs are mandatory.

Lodestar Fees

The lodestar method looks at the time spent on a matter multiplied by the reasonable hourly rate. (Serrano, supra 20 Cal.3d at 49). The two-step process begins with the lodestar method, which is the time spent on the matter multiple by the hourly rate. After the lodestar method, the second step is determining whether a multiplier should be applied. The factors that Courts look at to determine if a multiplier is reasonable are: 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.” (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1132). Plaintiffs contend that the hours billed were reasonable and compensable, the hourly rates were reasonable and have been previously approved, and the use of multiple attorneys is efficient. Defendant argues that the hours billed are unreasonable and should be reduced, especially those surrounding the fraud cause of action.

Reasonableness of Hours Billed

Plaintiffs contend that the billable hours are reasonable. The total amount billed is 169.7 hours. Plaintiffs argue that the fees related to the following are all allowed: pre-litigation activities, travel times, drafting the complaint and opposing the demurrer, written and oral discovery, trial document preparation, attorney declarations in advance of OSC hearing, and the current Motion for Attorneys’ Fees.

Defendant argues that the Court should reduce the award, as Plaintiffs have billed for work that was not actually or reasonably incurred. Defendant argues that certain bills, like pre-engagement work, communicating before drafting the complaint, templated discovery requests, reviewing discovery, bringing a new timekeeper for GM’s PMK deposition and the current motions fee. In total, Defendant argues that a total of 51.8 hours were not actually or reasonably incurred.

A verified fee bill is “prima facie evidence the costs, expenses and services listed were necessarily incurred, and when they are properly challenged the burden of proof shifts to the party claiming them as costs.” (Hadley v. Krepel (1985) 167 Cal.App.3d 677, 682.) Plaintiff provided a verified fee bill. Still, the Court is the ultimate arbiter in deciding whether expenses are reasonable. The court agrees with Defendant that certain fees are unreasonable.

For example, Plaintiffs’ attorneys billed 3 hours to draft discovery requests, which as Defendant points out, are used in all cases against Defendant. As such, the Court reduces the claim by $500.

Additionally, Plaintiff billed 7.9 hours to review Defendant’s discovery requests, and an additional 6.1 hours to prepare responses. Like drafting the discovery requests, these are not novel or special and are used in similar cases between the parties. In fact, this court has reviewed these template requests between these very parties on several occasions. As such, the Court reduces the claim by $2,000.

Lastly, the requested $7,630 for this current motion is excessive. A review of this motion indicates that it is similar to other motions for attorneys’ fees filed by Plaintiff’s counsel, except for the specifics for each case. As such, this amount is reduced by $4,000.

Fraud Billings:

While the Song-Beverly Act claim comes with a fee-shifting statute under which the present motion has been brought, (CCP § 1794(b),) common-law fraud claims have no such allowance, (See Aozora Bank, Ltd. v. 1333 North California Boulevard (2004) 119 Cal.App.4th 1291, 1294, citing Gray v. Don Miller & Associates, Inc. (1984) 35 Cal.3d 498, 506.) When a cause of action for which attorney fees are provided by statute is joined with other causes of action for which attorney fees are not permitted, the prevailing party may recover only on the statutory cause of action.” (Akins v. Enterprise Rent-A-Car Co. of San Francisco (2000) 79 Cal.App.4th 1127, 1133). However, fees do not need to be apportioned when from the same operative facts and are too intertwined to have apportionment be practical. (Santana v. FCA US, LLC (2020) 56 Cal.App.5th 334, 347.) The inquiry in Santana is instructive on when to apportion fees and when not to, and also considers this very issue in regarding a Song-Beverly Act claim and a fraud claim, Santana will thus be applied here.

Santana inquires into (1) if the two cases really stem from the same operative facts and (2) if so, if there is a practical way to apportion the fees between the causes of action. (Id. at 347-349.) Here, Defendant argues that the Plaintiffs are not entitled to any fees related to the common law fraud claim.

The Court finds that the fraud claim and the Song-Beverly Act claim do arise from the same operative facts. Plaintiffs also argue the demurrer filed by Defendant was overruled and therefore these hours spent on the Demurrer and Motion to Strike were reasonable and necessary. Thus, unless Defendants can show a way to separate out attorney hours spent on the fraud cause of action instead of the Song-Beverly Act cause of action, the two claims will not be apportioned and recovery for attorney fees will be allowed pursuant to the Song-Beverly Act.

Defendants’ Opposition helpfully provides the 21 different entries from the fee bill where Plaintiffs worked on the demurrer that solely related to the fraud claim. Plaintiffs billed 17.5 hours, totaling $8,847.50, related to the fraud claim. The Court agrees that work solely to the fraud claim is easily apportionable, and that the attorneys’ fees spent working on it are thus not recoverable pursuant to CCP §1794(d). The Court thus declines to award attorney fees for this effort, with a net reduction of $8,847.50.

As such, the Court reduces the requested lodestar by $14,347.50. In all other respects, the billings are proper and reasonable. To be clear, the Court finds the reasonable amount of fees, based upon its experience and knowledge of this type of litigation, the lack of novelty and complexity of this case, and the professed specialization of Plaintiff’s counsel, is $50,914.00. 

Reasonableness of Hourly Rate

            The Plaintiff contends that the hourly rates for the attorneys on the current matter are reasonable. The hourly rates range from $250 to $600. These rates are appropriate based on the qualifications of the attorneys and have been previously approved by the Superior Court, District Court, and other courts throughout California.

Defendant argues that Plaintiffs have failed to demonstrate that the fees are reasonable. Specifically, Defendant argues that Plaintiffs have not indicated or explained how counsels’ rates would increase between 12 and 21 percent.

“In determining hourly rates, the court must look to the “prevailing market rates in the relevant community.” (Bell v. Clackamas County (9th Cir.2003) 341 F.3d 858, 868.) The rates of comparable attorneys in the forum district are usually used. (See Gates v. Deukmejian (9th Cir.1992) 987 F.2d 1392, 1405.) In making its calculation, the court should also consider the experience, skill, and reputation of the attorney requesting fees.” (Heritage Pacific Financial, LLC v. Monroy (2013) 215 Cal.App.4th 972, 1009.) Here, each of the attorneys involved in this matter provided a declaration with their schooling, year admitted to the bar, experience, and previous rates approved by other courts. (See Dec. Barry, Dec. Galaviz, Dec. Pascal, Dec. Matera, Dec. Whitman, Dec. Norris.) The hourly rates are reasonable.

Costs:

Plaintiffs request $6,693.21 in costs and expenses. The memorandum of Costs is attached to the Motion as Exhibit 7. “Items on a verified cost bill are prima facie evidence the costs, expenses and services listed were necessarily incurred, and when they are properly challenged the burden of proof shifts to the party claiming them as costs.” (Hadley, supra, 167 Cal.App.3d at 682). Under CCP § 1794(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.”

Defendant argues that the Court should reduce the requests amount by $727.44. This is based on the $550 request in court reporter fees for the future hearing on April 6, 2023, which Defendant argues should be reduced since costs are only allowed if they are actually incurred and the $550 is an estimated cost. Second, Defendant argues that the $125 in “Messenger Service/Courtesy Copy” fees are not required and are excessive.

The Court finds that Defendant’s arguments is sound. Contrary to Plaintiffs’ argument, Defendant did timely file a Motion to Strike. Under Rules of Court 3.1700(b)(1), “any notice of motion to strike or to tax costs must be served and filed 15 days after service of the cost memorandum.” Here, Plaintiffs filed the Memorandum of Costs with the Court on February 1, 2023, but the Proof of Personal Service indicates that the Memorandum was served (via hand delivery) on March 14, 2023. Defendant filed a Motion to Strike Costs on March 27, 2023. Thus, Defendant filed a Motion to Strike within the allotted time. Second, the $550 for a future hearing is not an “incurred cost” as it has yet to occur. Lastly, as the name suggests, the “courtesy copy” is not a required cost. Therefore, the Court will reduce the requested amount by $727.44.

CONCLUSION:

            For the foregoing reasons, the Court decides the pending motion as follows:

Motion for Attorneys’ Fees is GRANTED, in the amount of $49,914.00 plus $5,965.77.

Moving party is to give notice.

IT IS SO ORDERED.

Dated:             April 6, 2023               _________________________________                                                                                                                  Upinder S. Kalra

                                                                                    Judge of the Superior Court