Judge: Upinder S. Kalra, Case: BC715541, Date: 2022-08-04 Tentative Ruling

Case Number: BC715541    Hearing Date: August 4, 2022    Dept: 51

Tentative Ruling

Judge Upinder S. Kalra, Department 51

HEARING DATE:   August 4, 2022                                               

CASE NAME:            Efren Marquez v. Kia Motors America Inc.

CASE NO.:                BC715541

PLAINTIFF’S MOTION FOR ATTORNEYS’ FEES

MOVING PARTY: Plaintiff Efren Marquez

RESPONDING PARTY(S): Defendant Kia Motors America Inc.

REQUESTED RELIEF:

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

TENTATIVE RULING:

Motion for Attorneys’ Fees is GRANTED.

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

On July 30, 2018, Plaintiff Efren Marquez filed a complaint against Defendant Kia Motors America, Inc., alleging violations of the Song-Beverly Act.

Defendant filed an Answer on August 30, 2018.

Plaintiff filed a Notice of Settlement on January 5, 2022.

This current Motion for Attorneys’ Fees was filed on May 12, 2022. Defendant filed an Opposition on July 21, 2022. Plaintiff’s reply was filed on July 28, 2022.

LEGAL STANDARD

A prevailing party is entitled to recover costs, including attorneys’ fees, as a matter of right, except as otherwise expressly provided by statute. (See Code Civ. Proc., §§ 1032(a)(4), 1032(b), 1033.5.) A prevailing party is “the party with a net monetary recovery, a defendant in whose favor a dismissal is entered, a defendant where neither plaintiff nor defendant obtains any relief, and a defendant as against those plaintiffs who do not recover any relief against that defendant.” (Id., § 1032(a)(4).)

However, “[w]here an action has been voluntarily dismissed or dismissed pursuant to a settlement of the case, there shall be no prevailing party for purposes of [Civil Code section 1717].” (Civ. Code, § 1717(b)(2); see Shapira v. Lifetech Resources, LLC (2018) 22 Cal.App.5th 429, 441 (“A trial court lacks discretion to award fees under section 1717(b)(2) where a case has been voluntarily dismissed.”); see also Santisas v. Goodin (1998) 17 Cal.4th 599, 615.) 

The fee setting inquiry in California ordinarily begins with the “lodestar” method, i.e., the number of hours reasonably expended multiplied by the reasonable hourly rate. 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. The lodestar figure may then 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.) 

Such an approach anchors the trial court’s analysis to an objective determination of the value of the attorney’s services, ensuring that the amount awarded is not arbitrary. (Id. at 48, n.23.) After the trial court has performed the lodestar calculations, it shall consider whether the total award so calculated under all of the circumstances of the case is more than a reasonable amount and, if so, shall reduce the section 1717 award so that it is a reasonable figure.  (PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1095-96.) 

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.) 

Under CCP § 425.16(c), a prevailing defendant shall recover attorneys’ fees. However, if a court finds the defendant’s motion frivolous, the plaintiff is entitled to fees, pursuant to 128.5. (CCP § 426.15(c)(1).

Evidentiary Objections:

Defendant’s Objections:

Declaration of Payam Shahian

Sustained:

Overruled: 1-59

The Defendant objected to all but 2 paragraphs in the Declaration. The grounds for the objection consisted of: lacks foundation, misleading and unduly prejudicial, inadmissible hearsay, argumentative and conclusory, and vague. In response, Plaintiff contends that this declaration is to demonstrate his knowledge of the information and can attest to the work performed. Moreover, the examples provided are to demonstrate that the hourly rates are comparable to those in the community and have been previously approved. This declaration is valid, provides proper foundation, is not misleading or prejudicial, does not include hearsay, and is not conclusory.

Declaration of Jason Clark 

Sustained:

Overruled: 1-64

Again, Defendant objected to all but 2 paragraphs in the Declaration. The grounds for the objection consisted of: lacks foundation, misleading and unduly prejudicial, inadmissible hearsay, argumentative and conclusory, irrelevant, improper expert opinion, and best evidence. In response, Plaintiff argues that this declaration is based on the information derived from his person knowledge, review of the file and court records, and communication with other counsel. This declaration is valid, provides proper foundation, is not misleading or prejudicial, does not include hearsay, and is not conclusory.

Declaration of Michael H. Rosenstein

Sustained:

Overruled: 1-8

Defendant objected to every paragraph provided in the Declaration. The grounds for the objection consisted of: lacks foundation, irrelevant, misleading and unduly prejudicial, inadmissible hearsay, and argumentative. Specifically, Defendant argues that under Rule 1.5.1 of rules of Professional Conduct, to split fees for legal services requires a written agreement, consent from the client and no increase based on agreement. This argument fails, and is discussed below. Plaintiff’s response indicates that Mr. Rosenstein is describing his knowledge of the matter and sets forth experience and previous hourly rates.

Plaintiff’s Objections:

Declaration of Amy K. Alexander

Sustained:

Overruled: 1-4

Plaintiff objections to paragraphs 5-8 of the declaration, which are copies of final rulings of other plaintiff’s motion for attorney fees, where rates were determined to be $350 and contains a nearly identical to the current motion. The grounds for the objection consisted of irrelevant and more prejudicial than probative, lacks foundation and personal knowledge. These documents are valid and not prejudicial, especially in light of the fact that the Plaintiff provided similar documentation of previous rulings. 

Service:

The proofs of service from both parties indicate that these motions and accompanying documents were served via email on the opposing party.

ANALYSIS:

Plaintiff moves for attorneys’ fees totaling $170,140.19.

Prevailing Party

After multiple years of litigation, the Defendant submitted a § 998 offer for $73,842.57. Under the SBA, the Plaintiffs are the prevailing party and thus, fees and costs are mandatory. Further, Plaintiffs contend that the requested attorneys’ fee amount need not be proportionate to the award.

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). Plaintiff contends that the lodestar fees are reasonable. Defendant contends that the Court should curb the excessive fees demanded in this matter.

a.      Hourly Rates

The Plaintiff contends that the hourly rates for the attorneys on the current matter are reasonable. The hourly rates range from $335 to $565. 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 the rates are too high and unsupported. Defendants cite to Arias v. Ford Motor Company (C.D. Cal. Jan. 27, 2020) No. 18-cv-1928, 2020 U.S. Dist. LEXIS 14899, *9) for the contention that rates for attorneys in a lemon law matter should be $325 an hour for partners and $250 per hour for associates. Defendants assert that the hourly rate should be reduced to $300 per hour, as no new issues were presented, no exceptional skill was displayed, and the matter did not go to trial.

“In determining hourly rates, the court must look to the “prevailing market rates in the relevant community… In making its calculation, the court should also consider the experience, skill, and reputation of the attorney requesting fees…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 declaration of P. Shahian provides the experience of each of the attorneys, their schooling background, year admitted into the bar, as well as previous rates that have been approved by other courts. (Dec. Shanian ¶ 36-54). The hourly rates are reasonable.

b.      Billable Hours

The Plaintiff also contends that the billable hours are reasonable. The total amount billed is 191.5 hours. While there are nine attorneys who staffed for this matter, two of the attorneys accounted for over 70% of the matter, billing 135.8 hours of the 191.5 in total. (Motion 10: 17-20).  While Plaintiff asserts that the Defendant may argue that this matter was overstaffed, previous courts have determined that certain cases require the use of multiple attorneys. Plaintiff cites to Holcomb, where the court stated, “there is no obvious indication that a fewer number of attorneys would have generated significantly fewer hours.” (Holcomb v. BMW of North America, LLC (S.D. Cal., Feb. 14, 2020, No. 18CV475 JM (BGS)) 2020 WL 759285, at *3).

            Defendant argues that there was no reason to engage in 12 attorneys from two different law firms for this typical lemon law matter. Further, Defendant contends that the hours were excessive, consisted of vague entries and block billing, and inflated fees. In the Alexander Declaration, Defendant provided an itemized chart, where Defendant objected to certain entries and provides a proposed reduction; a reduction of $29,250 for SLP and $12,027.50 for CCA. First, duplicative and excessive billings should be stricken. As for duplicative entries, Defendant requests the hours be cut by $29,250.50. For example, the Plaintiff seeks 13.2 hours for the current motion for attorney fees and seeks 8.6 hours for travel and attending the vehicle inspection. As for the block billing, Defendant argues that these entries are impossible to determine if the billing for one task was reasonable.

Verified cost bills are “prima facie evidence the costs, expenses and services listed were necessarily incurred…” (Hadley v. Krepel (1985) 167 Cal.App.3d 677, 682). Plaintiff provided a verified fee bill. While the Defendant did object to the billings provided by Plaintiff that some of the matters were excessive or block billing, a review of the entries indicates that the entries are generally reasonable. “Block billing occurs when “a block of time [is assigned] to multiple tasks rather than itemizing the time spent on each task.” (Mountjoy v. Bank of America, N.A. (2016) 245 Cal.App.4th 266, 279). These entries provide the delineated tasks that the attorneys spent working on, not just a vague reference to this particular case. Moreover, nine attorneys were staffed for this matter, but only two of them accounted for over 70% of the work. Still, the documentation provided by Plaintiff evidence some duplicative and unreasonable expenses. For example, attorney rates for drafting numerous form documents which are clerical in function especially with a firm highly specialized in this area of law is unnecessary unreasonable.  Similarly , billing 8.6 hour at $435 per hour for an attorney’s  travel time and attending a vehicle inspection is equally unreasonable. The court also finds the amount of time to file a routine fee motion (as evidence by the numerous attachments to the declarations) is excessive as well. Accordingly, the court finds that an adjustment is warranted. 

Multiplier of 1.35

Plaintiffs contend that a lodestar multiplier should be granted. When determining if a lodestar adjustment is applicable, courts look at various factors. These factors include “(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; and (3) the contingent nature of the fee awarded, based on the uncertainty of prevailing on the merits and of establishing eligibility for the award.” (Doppes v. Bentley Motors, Inc., (2009) 174. Cal.App.4th 967, 998).

The One, the Plaintiffs received an excellent outcome due to counsel’s representation. Two, the risk were substantial as this matter was on a contingency basis. In Ketchum, the court allowed a lodestar multiplier in cases of contingency matters. This was based on the risk of nonpayment as well as skill. (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1138). Defendant argues that the multiplier is inappropriate and should not be applied, as this was not novel or complex and Plaintiff’s counsel specializes in Lemon Law cases.

A multiplier is not appropriate. The issue here is not novel or complex. Plaintiff’s counsel’s experience with Song-Beverly exemplifies this. The Declaration of Payam Shahian states that SLP was founded with a “primary focus in consumer warranty and fraud cases, including class actions.” (Dec. Shahian ¶ 3). Additionally, the declaration states that Payam Shahian has “litigated hundreds of automotive defect cases involving California’s consumer protection statutes, including Song-Beverly.” (Id. at ¶ 4). Therefore, a multiplier is excessive.

Costs

Defendant contends that costs should be stricken because the amount was not included in a Memorandum of Costs verified by the party, as required under California Rule of Court 3.1700. Defendant does contest the award for $1,595 for “trial attendance” as this matter did not proceed to trial and the amount of $2,100 for “expense paid to Darrel Balsjo for Depo Prop,” but no invoice has been submitted.

On July 28, 2022,  filed a Plaintiffs in a memorandum of costs served

Plaintiff contends that because under Civil Code § 1794(d), if a buyer prevails, “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,” Plaintiff did not need to file a Memorandum of Costs requesting $12,546.49 in costs and expenses. In any event, the Memorandum of Costs was filed on July 28, 2022. California Rule of Court Rule. 3.1700(a)(1) provides that a party has 15 days after service of the Memorandum of Costs to serve notice of motion to strike or tax costs. The Court will give Defendants an opportunity to file such a notice.

CCA Argument:

Defendant contends that under Rule 1.5.1. of California Rule of Professional Conduct, fees can be divided between firms only if there is a written agreement, the client consents, and the fee charged is not increased. Here, Defendant argues that there was no evidence that Plaintiff agreed to this legal fee sharing. However, this argument fails, as Plaintiff contends, because communications between attorneys and their clients are privileged and should not be revealed for this matter. Moreover, this rule protects the client, and does not affect Defendant’s obligation to pay the statutory fees under CCP § 1794.

Conclusion:

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

Motion for Attorneys’ Fees is GRANTED, without a multiplier. The Court finds that utilizing a lodestar method, the reasonable amount of fees under the totality of the circumstances and applying its experience, not including costs, is as follow:

Strategic Legal Practices, APC = $71,517.00

California Consumer Attorneys = $32, 445.00

Moving party is to give notice.

IT IS SO ORDERED.

Dated:             August 4, 2022                        __________________________________                                                                                                                Upinder S. Kalra

                                                                                    Judge of the Superior Court