Garcia v. Ford Motor Company

[7] 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA [10] 11 GARCIA, et al, Case No.: 22-cv-1474-GPC 12 Plaintiffs, ORDER GRANTING IN PART 13 v. PLAINTIFFS’ MOTION FOR ATTORNEYS’ FEES AND COSTS 14 FORD MOTOR COMPANY, et al, 15 Defendants. [ECF No. 26] [16] 17 On April 14, 2023, Plaintiffs Araceli Garcia and Mario Garcia (“Plaintiffs”) filed a 18 Motion for Attorneys’ Fees and Costs. ECF No. 26. Defendant Ford Motor Company 19 (“Defendant” or “Ford”) filed an Opposition, (ECF No. 29), and Plaintiffs filed a Reply, 20 (ECF No. 30). For the reasons that follow, the Court GRANTS in part Plaintiffs’ request 21 and awards Plaintiffs $44,909.80 in attorneys’ fees and $1,350.75 in costs.1 [23] 1 The Court notes at the outset that the issue of subject matter jurisdiction was never 24 determined because the Motion for Remand was denied as moot after the Parties settled. 25 This is an unusual procedural posture, because if the Court lacks subject matter jurisdiction, the Court recognizes it could not rule on the pending Motion for Attorneys’ 26 Fees and Costs. Nevertheless, the Court finds that diversity jurisdiction exists because the 27 citizenship of the Parties is diverse, and the amount in controversy could reasonably 1 BACKGROUND 2 On April 18, 2020, Plaintiffs purchased a new vehicle from Ken Grody Ford in 3 Carlsbad, California. ECF No. 1-3 ¶ 5. Plaintiffs state the purchased vehicle “suffered 4 from nonconformity(s)” and that Defendant did not replace the vehicle or “otherwise 5 [make] restitution to Plaintiffs pursuant to its obligations [under law].” Id. ¶ 11. As such, 6 Plaintiffs filed this action in Orange County Superior Court on April 18, 2022 alleging 7 violations of the Song-Beverly Consumer Warranty Act (California’s “lemon law”). Id. at 8 9-11.2 9 On September 29, 2022, Defendant filed a Notice of Removal in this Court. ECF 10 No. 1 at 5. Plaintiffs filed a Motion for Remand on October 26, 2022. ECF No. 6. On 11 December 29, 2022, while the Motion for Remand remained pending, Defendant Ford 12 filed a Notice of Settlement. ECF No. 21. Accordingly, the Court denied the Motion for 13 Remand as moot. ECF No. 24. This Motion for Attorneys’ Fees and Costs followed. ECF 14 No. 26. 15 LEGAL STANDARD 16 Under the Song-Beverly Consumer Warranty Act, “[i]f the buyer prevails in an 17 action . . ., the buyer shall be allowed by the court to recover as part of the judgment a 18 sum equal to the aggregate amount of costs and expenses, including attorney’s fees based 19 on actual time expended, determined by the court to have been reasonably incurred by the 20 buyer in connection with the commencement and prosecution of such action.” Cal. Civ. 21 Code § 1794(d). Because this Court has diversity jurisdiction over this action, the Court 22 must apply state substantive law to determine the reasonableness of Plaintiffs’ requested [24] exceed $75,000 considering the amount of actual damages alleged in Plaintiffs’ [25] Complaint and their request for civil penalties pursuant to the Song-Beverly Act of two 26 times the actual damages. See ECF No. 1-3 at 13; see also Cal. Civ. Code § 1794 (c). 2 Page citations reference CM/ECF pagination. [27] 1 fees. See Mangold v. California Public Utilities Comm., 67 F.3d 1470 , 1478 (9th Cir. 2 1995). 3 Under California law, the lodestar method (total hours multiplied by the attorney’s 4 hourly rate) is the preferred method to award attorneys’ fees under the Song-Beverly Act. 5 See Robertson v. Fleetwood Travel Trailers of California, Inc., 144 Cal. App. 4th 785 , 6 818-19 (Cal. Ct. App. 2006) (stating California Supreme Court has “held that the lodestar 7 adjustment method is the prevailing rule for statutory attorney fee awards”); Ketchum v. 8 Moses, 24 Cal. 4th 1122, 1135-36 (Cal. 2001). A court should “‘make an initial 9 determination of the actual time expended’” and then determine “‘whether under all the 10 circumstances of the case the amount of actual time expended and the monetary charge 11 being made for the time expended are reasonable.’” Robertson, 144 Cal. App. 4th at 817 12 (quoting Nightingale v. Hyundai Motor America, 31 Cal. App. 4th 99, 104 (Cal. Ct. App. 13 1994)). To determine reasonableness, a court can consider the complexity of the case, the 14 skill exhibited by the attorneys, and the results achieved. Id. The fee award need not be 15 proportionate to the amount of damages recovered. Graciano v. Robinson Ford Sales, 16 Inc., 144 Cal. App. 4th 140, 164 (Cal. Ct. App. 2006) (finding legislative policy in favor 17 of award of all fees expended to ensure consumers can pursue small monetary claims). 18 Further, under California law, multipliers or fee enhancements are permitted. Ketchum, 19 24 Cal. App. 4th at 1135-36. The prevailing party has the burden to show the fees are 20 reasonable. Id. at 817-18. 21 DISCUSSION 22 The Parties do not dispute that Plaintiffs are entitled to attorneys’ fees and costs; 23 Defendant simply argues the amount Plaintiffs request is unreasonable. Plaintiffs seek 24 $48,842.30 in attorneys’ fees and $1,402.50 in costs. ECF No. 26-1 at 7. Plaintiffs state 25 the requested attorneys’ fees is based on a lodestar calculation of $37,571 plus a lodestar 26 multiplier of 0.3 for a fee enhancement of $11,271.30. Id. Plaintiffs state that Defendant [27] 1 refuses to “offer more than $20,000.” Id. at 6 (citing Sannipoli Decl. ¶¶ 39-41); ECF No. 2 29 at 6 (Defendant’s Opposition). 3 Plaintiffs state this amount is warranted “given Defendant’s insistence on starting 4 discovery and removing this action to Federal Court rather than respond[ing] to 5 Plaintiffs’ early settlement demand.” Id. at 7-8. Plaintiffs’ counsel argues that the 6 inherent risk associated with contingency fee agreements, the attorneys’ fair hourly rates, 7 and the comparability of the fee requested to other fees awarded in this District and 8 California state court all support finding the requested amount is reasonable. Id. at 14-19. 9 Plaintiffs’ counsel requests a 0.3 fee enhancement multiplier because of (1) the delay in 10 payment and (2) counsel’s “demonstrated expertise” in the matter and the results 11 obtained. Id. at 23-24. Plaintiffs’ counsel states they billed 75 hours in this case, (id. at 13 12 (citing Sannipoli Decl. ¶¶ 3-4)), and the fee motion includes detailed time records with 13 descriptions of services rendered and receipts showing costs, (see ECF No. 26-3, Exhs. 14 A-C). 15 Defendant argues the amount requested and the fee enhancement multiplier is 16 unreasonable given that there was no novelty or special skill involved, there was only 17 basic discovery, and Plaintiffs’ counsel “followed the same playbook using the same 18 stock pleadings they have used countless times before.” ECF No. 29 at 4, 8-9. Defendant 19 urges this Court to “not reward Plaintiffs’ counsel[‘s] poor billing practices and strike 20 improper entries . . . .” Id. at 4-5. Defendant argues Plaintiffs’ counsel is entitled to no 21 more than $13,983 in attorneys’ fees. Id. at 5. Defendant disputes Plaintiffs’ use of block 22 billing and recovery for interoffice communication and administrative tasks. ECF No. 29 23 at 13-16. Further, Defendant argues the total cost of the invoices attached to Plaintiffs’ 24 Motion at Exhibit C is only $1,277.50, not the $1,402.50 requested. Id. 25 To determine the lodestar value of services Plaintiffs’ counsel expended, the Court 26 must perform two inquiries: (1) calculate the number of hours reasonably spent litigating [27] 1 this case; and (2) determine the reasonable hourly rate for such services. Reynolds v. Ford 2 Motor Co., 261 Cal. Rptr. 3d 463 , 468 (Cal. Ct. App. 2020). Plaintiffs’ action involved 3 the filing of a Complaint in state court, discovery, the preparation and filing of a Motion 4 for Remand in this Court as well as a Reply in support thereof, settlement negotiations, 5 and the preparation and filing of this Motion for Attorneys’ Fees and Costs and the Reply 6 in support thereof. Plaintiffs’ counsel submitted billing entries along with their fee 7 request. See ECF No. 26-3, Exhs. A-B. 8 I. Hours Reasonably Expended by Plaintiffs’ Counsel 9 Under the Song-Beverly Act, the Court must determine the actual, reasonable 10 hours expended by Plaintiffs’ counsel. Reynolds, 261 Cal. Rptr. 3d at 468. A court must 11 grant the prevailing buyer recovery of all “‘attorneys’ fees reasonably expended, without 12 limiting the fees’ to a proportion of any recovery of damages or other monetary relief.” 13 Id. (quoting Graciano, 144 Cal. App. 4th at 164 ). Accordingly, at this step, the Court 14 need only determine whether the hours expended by Plaintiffs’ counsel were reasonable. 15 Plaintiffs’ counsel billed 75 hours to prosecute Plaintiffs’ action, although ten of these 16 hours were “estimated” to respond to Defendant’s Opposition to this Motion. ECF No. 17 26-3, Exh. A at 11. Defendant argues counsel’s billable hours are unreasonable because 18 this case involved no novelty and the claims were not difficult. ECF No. 29 at 8. 19 The Court has reviewed extensively the billing entries provided by Plaintiffs’ 20 counsel and the Defendant’s objections. The Court finds the entries are reasonable to 21 prosecute Plaintiffs’ action. The majority of the billable hours relate to case management 22 and discovery matters and settlement negotiations. The time entries rarely exceed one 23 hour and are sufficiently detailed for the Court to determine the hours were reasonably 24 expended and not frivolous or redundant. Counsel spent approximately 13 hours 25 researching, drafting, and filing the Motion for Remand and the Reply in support thereof. 26 See ECF No. 26-3, Exh. A at 5-6. Counsel expended approximately 8 hours drafting the [27] 1 attorneys’ fees motion and preparing the billing entry exhibits and declaration. Id. at 11. 2 Contrary to Defendant’s argument, the Court does not see any entries in which it appears 3 Plaintiffs’ counsel overcharged for tasks that are likely streamlined as a result of 4 counsel’s extensive experience with Song-Beverly litigation. See ECF No. 29 at 8 5 (arguing that Plaintiffs’ counsel intentionally incurred the maximum amount of legal fees 6 rather than litigate in an efficient manner and making use of “stock pleadings”); see ECF 7 No. 26-3, Exh. A at 2 (April 18, 2022 entry billing one hour total to draft complaint, 8 prepare civil case cover sheet, and summons, among other tasks). 9 Defendant does not make any objection to specific entries in Plaintiffs’ billing 10 invoice. Rather, Defendant broadly argues that counsel improperly employs block billing 11 and counsel improperly includes hours spent on interoffice communication and 12 administrative tasks. ECF No. 29 at 13-16. The Court finds these objections without 13 merit. First, block billing is not prima facie objectionable. Block billing is first and 14 foremost objectionable when billing records block bill multiple tasks in which only some 15 are entitled to fee recovery. See Bell v. Vista Unified School Dist., 82 Cal. App. 4th 672 , 16 689 (Cal. Ct. App. 2000) (objecting to block billing because the court could not break 17 down the hours to determine which were related to Brown Act violations and therefore 18 recoverable and other legal claims that were not recoverable). Here, all of the tasks relate 19 to Plaintiffs’ claim under the Song-Beverly Act, and fees are recoverable under this 20 statutory scheme. Further, only two entries exceeded even four hours of billable time— 21 the eight hours billed to open the case, (ECF No. 26-3 Exh. A at 2), and the 22 approximately seven hours spent drafting the attorneys’ fees motion, (id. at 11). This is 23 not an egregious use of block billing. The vast majority of the entries are less than one 24 hour. Thus, block billing is not objectionable in this context. 25 Second, Defendant argues interoffice communication and administrative tasks are 26 not recoverable fees. The Court agrees with Plaintiffs that Defendant cites no authority [27] 1 for the allegation interoffice communication is not recoverable. ECF No. 30 at 8. 2 Defendant supports their argument with a citation to a case in which the Supreme Court 3 stated fee recovery is limited to those hours counsel could properly charge a client. See 4 (ECF No. 29 at 15) (citing to Hensley v. Eckerhart, 461 U.S. 424, 434 (1983)). Defendant 5 does not provide support for finding that attorneys cannot, and do not, bill their clients for 6 modest, reasonable, and necessary interoffice communication. 7 Defendant also argues that Plaintiffs’ counsel improperly seeks fees for 8 administrative tasks. ECF No. 29 at 15-16. The case Defendant cites, Nikko Materials 9 USA, Inc. v. R.E. Serv. Co., 2006 WL 118438 (N.D. Cal. Jan. 13, 2006), does not stand 10 for the proposition Defendant asserts. Nikko Materials concerns fee recovery under the 11 Patent Act and does not reject fees for secretarial or administrative work. In fact, it stands 12 for the opposite proposition. See Nikko Materials USA, Inc. v. R.E. Serv. Co., 2006 WL 13 118438, at *5 (N.D. Cal. Jan. 13, 2006) (stating the Patent Act allows for recovery of not 14 only attorney fees, “but also the recovery of all reasonable expenses incurred in 15 prosecuting the entire action”). The specific billing objections Defendant raises as 16 improper “administrative tasks” are paralegal support services. ECF No. 29 at 16. 17 Paralegal and secretarial support services are recoverable in statutory fee awards. See 18 Salton Bay Marina, Inc. v. Imperial Irrigation Dist., 172 Cal. App. 3d 914, 951 (Cal. Ct. 19 App. 1985 ) (stating “necessary support services for attorneys, e.g., secretarial and 20 paralegal services, are includable within an award of attorney fees”). Thus, the Court 21 does not find these billing entries objectionable. 22 Accordingly, the Court finds the 65 hours Plaintiffs’ counsel billed in this action 23 was reasonable. However, Plaintiffs’ counsel estimates a total of ten hours for reviewing 24 and replying to Defendant’s Opposition to the instant Motion. ECF No. 26-3, Exh. A at 25 11. The Court finds only five hours is reasonable to allot to this task; indeed, counsel 26 billed approximately five hours for the preparation and filing of the Reply in support of [27] 1 the earlier Motion for Remand. Id. at 7 . Further, because the hearing on this motion is 2 vacated, Plaintiffs’ counsel need not bill for hearing preparation. Thus, the Court finds 3 Plaintiffs’ counsel can fairly be compensated for 70 billable hours in this action. The 4 Court must next determine if the hourly rates are reasonable. 5 II. Reasonable Hourly Rates 6 “Reasonable hourly compensation is based on ‘prevailing hourly rates’ in the 7 community, thereby ‘anchoring the calculation’ to an objective standard.” Reynolds, 261 8 Cal. Rptr. 3d at 468 (quoting Ketchum, 24 Cal. 4th at 1131-32 )). In this action, Plaintiffs’ 9 counsel billed attorney rates between $475 and $605 per hour. ECF No. 26-3, Exh. B at 10 14. Plaintiffs’ counsel billed paralegal and legal assistants at rates from $235 to $265 per 11 hour. Id. at 15. Counsel argues these fee rates are reasonable given the contingent nature 12 of the litigation, the extensive experience of Plaintiffs’ counsel with Song-Beverly 13 claims, and the fact that the hourly rates are at or below the rates typically charged in the 14 Southern California market. ECF No. 26-1 at 16. 15 Defendant does not appear to argue that the hourly rates are unreasonable or out of 16 line with the current market rate.3 The Court agrees this case did not present novel or 17 complex issues. However, the attorneys involved are highly skilled in Song-Beverly 18 cases, and the law firm, Bickel Sannipoli APC, is known as a “lemon law” firm 19 throughout the state of California. ECF No. 26 at 14. The civil practice of the firm is 20 exclusively limited to Song-Beverly claims. Id. The attorneys in this action have many [23] 24 3 In a confusing fashion, Defendant states that Plaintiffs’ counsel requests $276,439 in attorneys’ fees with rates as high as $890.50 per hour if a multiplier is added. ECF No. 29 [25] at 9. Plaintiffs’ counsel does not request anything close to this amount—they request 26 48,842.30 in attorneys’ fees, including a positive fee enhancement multiplier of .3, and the highest hourly rate is $605. [27] 1 years’ experience litigating Song-Beverly actions and have a proven track record of 2 success. Id. at 15; see also Sannipoli Decl. ¶ 43. 3 In addition, Plaintiffs’ counsel’s hourly rates are similar to rates that have been 4 upheld in this District and in California state court. In 2020, Judge Whelan in the 5 Southern District of California awarded counsel’s firm attorneys’ fees in a Song-Beverly 6 case in which the highest-end attorney rate was $655. See Chavez v. Jaguar Land Rover 7 North America, LLC, 2020 WL 376209 , at *2 (S.D. Cal. Jan. 23, 2020). Taking into 8 account inflation, the Court finds counsel’s currently hourly rates are reasonable. Thus, 9 the Court awards attorneys’ fees in the amount of $34,546. 10 III. Fee Enhancement Multiplier 11 “Once the touchstone or lodestar figure . . . is calculate as ‘the basic fee,’ ‘it may 12 be adjusted by the court [by applying a multiplier] based on factors including . . ., (1) the 13 novelty and difficulty of the questions involved, (2) the skill displayed in presenting 14 them, (3) the extent to which the nature of the litigation precluded other employment by 15 the attorneys, [and] (4) the contingent nature of the fee award.’” Reynolds, 261 Cal. Rptr. 16 3d at 468. 17 Plaintiff’s counsel argues they are entitled to a .3 multiplier because of the delay in 18 receiving payment and because of “the skill displayed in presenting the case, and the 19 results obtained.” ECF No. 26 at 23. The Court finds this multiplier is warranted and 20 appropriate. Defendant does not in substance dispute the application of a multiplier for 21 these specific reasons; Defendant simply argues that the fee is excessive and thus no 22 multiplier is warranted. ECF No. 29 at 10. 23 Under California law, courts can apply positive multipliers to account for the delay 24 between when services were actually rendered and when payment is received. See 25 Graham v. Daimler Chrysler Corp., 21 Cal. Rptr. 3d 331, 355 (Cal. 2004). “‘Court26 awarded fees are normally received long after the legal services are rendered. That delay [27] 1 can present cash-flow problems for the attorneys. In any event, payment today for 2 services rendered long in the past deprives the eventual recipient of the value of the use 3 of the money in the meantime, which use, particularly in an inflationary era, is valuable. 4 A percentage adjustment to reflect the delay in receipt of payment therefore may be 5 appropriate.’” Id. (quoting Copeland v. Marshall, 641 F.2d 880, 893 (D.C. Cir. 1980)). 6 Here, Plaintiffs’ counsel has not received any payment for legal services rendered in this 7 action since the action commenced in February 2022. See ECF No. 26-3 at 2. Thus, a 8 modest multiplier of 0.2 reasonably accounts for this sixteen-month delay. 9 Further, the Court finds that a positive 0.1 multiplier is appropriate given the 10 results obtained. Plaintiffs’ counsel achieved a settlement of “restitution [] for payments 11 made toward the subject vehicle, $1,000 for incidental expenses, and an agreement to pay 12 off Plaintiffs’ outstanding loan obligation.” ECF No. 26 at 6. This is precisely what 13 Plaintiffs hoped to achieve at the outset of the litigation. Id. 14 Accordingly, the Court finds support for the requested fee enhancement of 0.3. The 15 Court awards attorneys’ fees in the amount of $44,909.80. 16 IV. Costs 17 Plaintiffs’ Motion requests $1,402.50 in costs and expenses. ECF No. 26 at 24. 18 Defendant does not dispute that counsel is owed costs and expenses, simply that the 19 evidence only accounts for $1,277.50, a discrepancy of $125. ECF No. 29 at 17. 20 Plaintiffs’ Reply states the initial request for costs included an estimate of $125 to print 21 and deliver courtesy copies of the Motion for Attorneys’ Fees to this Court. ECF No. 30 22 at 11. In their Reply, Plaintiffs’ counsel states that the actual cost for the courtesy copies 23 was $73.25. Id. Plaintiffs’ counsel accordingly revises the cost request to $1,350.75. 24 Accordingly, the Court grants Plaintiffs’ request for $1,350.75 in costs and expenses. [27] 1 CONCLUSION 2 For the reasons above, the Court GRANTS in part Plaintiffs’ Motion for 3 || Attorneys’ Fees and Costs. The Court grants Plaintiffs’ counsel $44,909.80 in attorneys’ 4 || fees and $1,350.75 in costs. The attorneys’ fees calculation includes a fee enhancement of 5 ||0.3 to account for the delay in payment and the results obtained. 6 IT IS SO ORDERED. 7 ||Dated: June 12, 2023 9 United States District Judge [27] 28 22-cv-1474-GPC