HESS v. VOLKSWAGEN GROUP OF AMERICA, INC.

398 P.3d 27
CourtCourt of Civil Appeals of Oklahoma
DecidedMarch 13, 2017
StatusPublished

This text of 398 P.3d 27 (HESS v. VOLKSWAGEN GROUP OF AMERICA, INC.) is published on Counsel Stack Legal Research, covering Court of Civil Appeals of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
HESS v. VOLKSWAGEN GROUP OF AMERICA, INC., 398 P.3d 27 (Okla. Ct. App. 2017).

Opinion

OSCN Found Document:HESS v. VOLKSWAGEN GROUP OF AMERICA, INC.

HESS v. VOLKSWAGEN GROUP OF AMERICA, INC.
2017 OK CIV APP 35
398 P.3d 27
Case Number: 114131
Decided: 03/13/2017
Mandate Issued: 07/11/2017
DIVISION IV
THE COURT OF CIVIL APPEALS OF THE STATE OF OKLAHOMA, DIVISION IV


Cite as: 2017 OK CIV APP 35, 398 P.3d 27

RAJINA HESS and KELLY PARSONS, individually and on behalf of persons similarly situated, Plaintiffs/Appellees/Counter-Appellants,
v.
VOLKSWAGEN GROUP OF AMERICA, INC., Defendant/Appellant/Counter-Appellee,

CHARLES MILLER and VIVIAN MILLER, individually and on behalf of other persons similarly situated, Intervenor Plaintiffs/Counter-Appellants.

APPEAL FROM THE DISTRICT COURT OF
POTTAWATOMIE COUNTY, OKLAHOMA

HONORABLE JOHN G. CANAVAN JR., TRIAL JUDGE

AFFIRMED IN PART, REVERSED IN PART,
AND REMANDED WITH DIRECTIONS

Terry W. West, Bradley C. West, THE WEST LAW FIRM, Shawnee, Oklahoma
T. Christopher Tuck (admitted pro hac vice), A. Hoyt Rowell, III (admitted pro hac vice), RICHARDSON, PATRICK, WESTBROOK & BRICKMAN, LLC, Mount Pleasant, South Carolina
Dennis E. Murray (admitted pro hac vice), MURRAY & MURRAY, Sandusky, Ohio, and
Juan Bauta (admitted pro hac vice), THE FERRARO LAW FIRM, Miami, Florida, for Plaintiffs/Appellees/Counter-Appellants and Intervenor Plaintiffs
John H. Tucker, Colin H. Tucker, Kerry R. Lewis, RHODES, HIERONYMUS, JONES, TUCKER & GABLE, Tulsa, Oklahoma and Daniel V. Gsovski, HERZFELD & RUBIN, PC, New York City, New York, for Defendant/Appellant/Counter-Appellee

DEBORAH B. BARNES, PRESIDING JUDGE:

¶1 The trial court previously granted attorney fees against Defendant/Appellant/Counter-Appellee Volkswagen Group of America, Inc., (Volkswagen) in an amount exceeding $7 million in this multi-jurisdictional, class action law suit. In an appeal from that award, the Oklahoma Supreme Court concluded the trial court abused its discretion by failing to deduct the entirety of fees claimed in certain "failed Florida litigation" when calculating the lodestar fee; the Court also concluded the trial court abused its discretion by multiplying the lodestar fee of approximately $3.6 million by 1.9. See Hess v. Volkswagen of Am., Inc., 2014 OK 111, ¶¶ 38 & 39, 341 P.3d 662. Thus, the Court reversed the trial court's order and remanded the case with instructions that "[t]he attorney fees, as herein modified, are to be assessed against Volkswagen . . . in a manner consistent with this opinion and as ordered by the trial court." Id. ¶ 40. The Court emphasized that the total recovery in this case against Volkswagen of only $45,780 is "minuscule" when "the pay-out is spread across the entirety of the defined class[.]" Id. ¶ 35. However, the Court stated in its conclusion that "[t]here is a strong presumption that the lodestar method, alone, will reflect a reasonable attorney fee." Id. ¶ 39 (footnote omitted). The Court declined to address Volkswagen's "due process challenge, as attorney fees must be recalculated on remand." Id. ¶ 1 n.1.

¶2 Volkswagen now appeals from the trial court's Order awarding, on remand, an attorney fee in the amount of $983,616.75, together with expenses and postjudgment interest "from the date of Judgment of June 14, 2013, through the present date." Volkswagen does not contest that the trial court, as instructed, subtracted the fees generated in the failed Florida litigation from the lodestar fee. Moreover, Volkswagen admits the trial court "then reduced the lodestar by 70%[.]" However, Volkswagen asserts on appeal that the new attorney fee award - an award which constitutes a mere 13.6% of the prior attorney fee award - is still too high. Volkswagen points out that the new award equals approximately "21.5 times as much money as . . . recovered for the entire class," and argues that the award constitutes both "an abuse of discretion under Oklahoma law" and "violates due process." Volkswagen also argues the trial court erred in finding that postjudgment interest is to run from June 14, 2013, rather than from June 18, 2015 - the date of the Order which is the subject of the present appeal.

¶3 Plaintiffs/Appellees/Counter-Appellants Rajina Hess and Kelly Parsons, and Intervenor Plaintiffs/Counter-Appellants Charles and Vivian Miller, individually and on behalf of persons similarly situated (collectively, Plaintiffs), counter appeal. They argue the trial court erred in reducing the lodestar fee.

¶4 For a more detailed recitation of the facts and procedure of this case leading up to the prior appeal, see Hess, 2014 OK 111. This case was also the subject of an even earlier appeal - as noted by the Supreme Court, "[a] more detailed account of the underlying certification process can be found in Hess v. Volkswagen of America, Inc., 2009 OK CIV APP 84, 221 P.3d 132." 2014 OK 111, ¶ 3 n.5.

STANDARD OF REVIEW

¶5 As stated by the Supreme Court in the prior appeal,

The reasonableness of attorney fees depends on the facts and circumstances of each individual case and is a question for the trier of fact. The standard of review for considering the trial court's award of an attorney fee is abuse of discretion. Reversal for an abuse of discretion occurs where the lower court ruling is without rational basis in the evidence or where it is based upon erroneous legal conclusions.

Hess, 2014 OK 111, ¶ 9 (footnotes omitted).

ANALYSIS

I. Is the new attorney fee award so high as to constitute an abuse of discretion?

¶6 The fundamental goal of the trial court in this case was to "arriv[e] at a fair and reasonable fee for class counsel," and the trial court's upward or downward adjustment, if any, of the lodestar fee - i.e., the "fee arrived at by multiplying the attorney's hourly rate by the time expended" - was to be based on application of those factors delineated by the Legislature in 12 O.S. Supp. 2013 § 2013(G)(4)(e). Hess, ¶ 10. Those factors, as summarized by the Supreme Court, are:

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Hess v. Volkswagen Group of America, Inc.
2017 OK CIV APP 35 (Court of Civil Appeals of Oklahoma, 2017)

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Bluebook (online)
398 P.3d 27, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hess-v-volkswagen-group-of-america-inc-oklacivapp-2017.