Tercero v. Mercedes-Benz USA, LLC

District Court, S.D. California·Decided June 24, 2025·No. 3:24-cv-02084·Unknown

Opinion

LUIS TERCERO, Case No.: 24-CV-2084 TWR (KSC)

Plaintiff, ORDER (1) GRANTING IN PART v. PLAINTIFF’S MOTION FOR ATTORNEYS’ FEES; MERCEDES-BENZ USA, LLC, a (2) GRANTING PLAINTIFF’S Delaware Limited Liability Company; and MOTION FOR COSTS AND DOES 1 THROUGH 10, inclusive, EXPENSES; AND (3) DENYING AS Defendants. MOOT PLAINTIFF’S MOTION TO

(ECF Nos. 8, 19, 20) Presently before the Court are Plaintiff Luis Tercero’s Motion for Attorneys’ Fees (“Fees Mot.,” ECF No. 19), and Motion for Costs and Expenses (“Costs Mot.,” ECF No. 20), as well as Defendant Mercedes-Benz USA, LLC’s Opposition to (“Opp’n,” ECF No. 22) and Plaintiff’s Reply in support of (“Reply,” ECF No. 24) the Fees Motion. For the reasons set forth below, the Court GRANTS IN PART Plaintiff’s Fees Motion and GRANTS Plaintiff’s Costs Motion. Additionally, in light of the settlement agreement between the Parties, (see ECF No. 16), the Court DENIES AS MOOT Plaintiff’s Motion to Remand to State Court (“Remand Mot.,” ECF No. 8). On October 1, 2024, Plaintiff initiated this action by filing his Complaint in the Superior Court of California, County of San Diego. (See ECF No. 1-2 (“Compl.”) at 4.) The Complaint alleged two claims, both for violations of the Song-Beverly Consumer Warranty Act.1 (Compl. at 6:6, 7:10.) Defendant removed the action to this Court on November 6, 2024, (see ECF No. 1), and the case settled at the Early Neutral Evaluation, which the Honorable Karen S. Crawford held on February 10, 2025. (See ECF No. 16; see also ECF No. 19.) “In a diversity case” such as this one, “the law of the state in which the district court sits determines whether a party is entitled to attorney fees, and the procedure for requesting an award of attorney fees is governed by federal law.” Carnes v. Zamani, 488 F.3d 1057, 1059 (9th Cir. 2007). “Under § 1794(d) of California’s Song-Beverley Act, the prevailing party shall be allowed to recover attorneys’ 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.’” Nguyen v. BMW of N. Am., LLC, No. 20-CV-2432 JLS (BLM), 2023 WL 173921, at *1 (S.D. Cal. Jan. 12, 2023) (quoting Cal. Civ. Code § 1794(d)). “A prevailing buyer has the burden of showing that the fees incurred were allowable, were reasonably necessary to the conduct of the litigation, and were reasonable in amount.” Id. (quoting Nightingale v. Hyundai Motor Am., 31 Cal. App. 4th 99, 104 (1994)). “The opposing party may object to specific costs, placing the burden on the buyer to demonstrate their necessity.” Aispuro v. Ford Motor Co., No. 18-CV-2045 DMS (KSC), 2020 WL 4582677, at *2 (S.D. Cal. Aug. 10, 2020) (citing Rappenecker v. Sea-Land Serv., Inc., 93 Cal. App. 3d 256, 266 (1979)). / / /

1 These claims are colloquially referred to as “lemon law” claims. E.g., Blood v. Mercedez-Benz, “Courts calculate attorneys’ fees under § 1794(d) using the ‘lodestar adjustment method.’” Id. (quoting Robertson v. Fleetwood Travel Trailers of Cal., Inc., 144 Cal. App. 785, 818 (2006)). First, the Court “begins with a touchstone or lodestar figure, based on the careful compilation of the time spent and reasonable hourly compensation of each attorney.” Id. (quoting Ketchum v. Moses, 24 Cal. 4th 1122, 1131–32 (2001)). Next, the Court has the discretion to adjust the lodestar figure based on “(1) the novelty or 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, [and] (4) the contingent nature of the fee award.” Id. (quoting Ketchum, 24 Cal. 4th at 1132). “The purpose of such adjustment is to fix a fee at the fair market value for the particular action.” Ketchum, 24 Cal. 4th at 1132. Plaintiff requests that the Court award a lodestar figure of $35,105.50, a lodestar multiplier enhancement of $17,552.75, and actual costs in the amount of $865.50. (Fees Mem. at 7:22–8:3.) In total, Plaintiff seeks $53,523.75 in attorneys’ fees and costs for the work done by his attorneys from Knight Law Group, LLP (“KLG”) on a lemon law claim related to a vehicle leased for $56,571.80. (ECF No. 19-1 (“Fees Mem.”) at 8:2–6.) I. Attorneys’ Fees A. Reasonableness of Hourly Rates “The burden is on the fee applicant to produce satisfactory evidence—in addition to the attorney's own affidavits—that the requested rates are in line with those prevailing in the community for similar services by lawyers of reasonably comparable skill, experience, and reputation.” Nguyen, 2023 WL 173921, at *2 (alteration adopted) (quoting Camacho v. Bridgeport Fin., Inc., 523 F.3d 973, 979 (9th Cir. 2008)). “The relevant community is that in which the district court sits.” Carr v. Tadin, Inc., 51 F. Supp. 3d 970, 978 (S.D. Cal. 2014). “Once the fee applicant has proffered such evidence, the opposing party must produce its own affidavits or other evidence to rebut the proposed rate.” Nguyen, 2023 WL 173921, at *2. Here, Plaintiff requests the following rates: Name Position Hourly Rate Debra Reed Associate Attorney II $495 Jacob Cutler Senior Attorney $550 Lauren Ungs Partner $550 Russell Higgins Partner $550–6002 Scot Wilson Partner $645 Norman Little Paralegal $145 (See ECF No. 19-3 (“KLG Invoice”) at 9.) Plaintiff asserts that these rates are reasonable because “numerous court orders [have] confirm[ed] the reasonableness of Plaintiff’s counsels’ hourly rates[,]” “[t]his case required a range of specialized knowledge[,]” and “Plaintiff’s attorneys’ experience has enabled them to develop litigation strategies that are highly effective and cost and time efficient.” (Fees Mem. at 13:22–23, 14:12–13, 15:14–16.) Roger Kirnos, the Managing Partner at KLG, submitted a declaration in support of the Fees Motion in which he describes the fees awarded to his firm in twenty different cases from jurisdictions throughout California. (ECF No. 19-2 (“Kirnos Decl.”) ¶¶ 28–47.) Notably, only two of these cases are from the Southern District of California, and both are approximately five years old. (See Kirnos Decl. ¶¶ 35, 39.) Defendant contends that Plaintiff’s requested hourly rates are unreasonable and instead suggests hourly rates of $400 for all attorneys and $100 for paralegals. (Opp’n at 8:12–16.) Specifically, Defendant argues that “[n]o evidence is presented that [Plaintiff’s] attorneys actually bill any clients at th[e requested] rates” and that Kirnos “do[es] not 2 Although Plaintiff does not squarely address the increase in Russell Higgins’s rate from $550/hour to $600/hour, it appears that KLG changed his rate at the beginning of 2025. (See generally KLG Invoice; provide any details about the respective cases cited[.]” (Opp’n at 8:2–4.) In support of its argument, Defendant submitted a declaration from Mehgan Gallagher—one of Defendant’s attorneys of record—and copies of orders on attorneys’ fees motions from seven different federal cases in California. (See ECF Nos. 22-1 (“Gallagher Decl.”), 22-6, 22-7, 22-8, 22-9, 22-10, 22-11, 22-12.) None of the cases provided by Defendant were litigated in the Southern District of California. Because the Parties have provided little caselaw from the Southern District of California, the Court will rely on its own survey of lemon law cases in this District. Four recent decisions guide the Court’s analysis. First, in Aispuro v. Ford Motor Company (2020), a case involving KLG attorneys, the Ho

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Tercero v. Mercedes-Benz USA, LLC, (S.D. Cal. 2025).

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