Wu v. BMW of North America, LLC

• Court: District Court, N.D. California
• Decided: July 18, 2022
• Docket: 4:21-cv-03485
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 SHANGWEI WU, Case No. 21-cv-03485-DMR

8 Plaintiff, ORDER ON MOTION FOR 9 v. ATTORNEYS' FEES

10 BMW OF NORTH AMERICA, LLC, Re: Dkt. No. 20 11 Defendant.

12 13 Plaintiff Shangwei Wu filed this action in San Francisco Superior Court against BMW of 14 North America (“BMW”) asserting violations of the California Song-Beverly Consumer Warranty 15 Act, Cal. Civ. Code § 1790 et seq., related to his purchase of a used 2017 BMW X5 (the 16 “vehicle”). [Docket No. 1-1 (“Compl.”).] BMW removed the case on the basis of diversity 17 jurisdiction on May 11, 2021. [Docket No. 1.] On the day of the initial case management 18 conference and before any significant litigation took place, the parties filed a notice of settlement 19 of all issues except attorneys’ fees. [Docket Nos. 16-17.] Wu now brings this motion for 20 attorneys’ fees and costs (“Mot.”). [Docket No. 19.] BMW filed an opposition (“Opp’n”), and 21 Wu replied (“Reply”). This matter is suitable for determination without oral argument. Civ. L.R. 22 7-1(b). For the following reasons, the court grants the motion in part and denies it in part.1 23 I. BACKGROUND 24 On July 9, 2020, Wu purchased the vehicle for $46,771.80, inclusive of license and 25 registration fees. Compl. ¶ 6. The vehicle began exhibiting engine defects within sixteen hours of 26

27 1 All parties have consented to the jurisdiction of a magistrate judge pursuant to 28 U.S.C. § 1 purchase, including a recurrent illumination of the “check engine” light, the “drivetrain 2 malfunction light,” and the recurrent smell of fuel emanating from the vehicle during operation. 3 Declaration of Isaac S. Agyeman (“Agyeman Decl.”) ¶ 8 [Docket No. 19-1]; see Compl. ¶ 13. Wu 4 brought the vehicle to BMW twice for repair, but BMW was unable to fix the defects. Agyeman 5 Decl. ¶ 8; see Compl. ¶¶ 16-18. 6 On March 23, 2021, Wu filed this lawsuit alleging breach of express warranty, breach of 7 implied warranty, and willful failure to comply with affirmative duties under the Song-Beverly 8 Act. After BMW removed the case, the parties initiated settlement negotiations. Agyeman Decl. 9 ¶ 9; Opp’n at 2. Wu proposed a full repurchase of the vehicle plus $10,000 in attorneys’ fees and 10 costs. Agyeman Decl. ¶ 9; Opp’n at 2. BMW countered on June 18, 2021 by agreeing to 11 repurchase the vehicle and to pay $2,500 in fees and costs. Agyeman Decl. ¶ 9; Opp’n at 2. On 12 July 9, 2021, having reached agreement on the vehicle repurchase, Plaintiff responded with a fee 13 demand of $9,500. Opp’n at 2. BMW rejected that proposal and made a final fee offer of $4,000. 14 Agyeman Decl. ¶ 9. The parties signed a settlement agreement on August 12, 2021 for statutory 15 repurchase of the vehicle at $20,751.62 but failed to reach a resolution on fees. Agyeman Decl. 16 Ex. D ¶ 4. [Docket No. 19-5.] Instead, BMW acknowledged that Wu is the prevailing party and 17 agreed to pay reasonable attorneys’ fees and costs in an amount to be determined by court order. 18 Id. ¶ 4(b). 19 II. LEGAL STANDARD 20 In diversity actions such as this one, state law governs a party’s right to attorneys’ fees as 21 well as the method of calculation. See Riordan v. State Farm Mut. Auto. Ins. Co., 589 F.3d 999, 22 1004 (9th Cir. 2009). The Song-Beverly Act is a consumer protection statute with a fee-shifting 23 provision that entitles prevailing buyers to “a sum equal to the aggregate amount of costs and 24 expenses, including attorney’s fees based on actual time expended, determined by the court to 25 have been reasonably incurred by the buyer in connection with the commencement and 26 prosecution of such action.” Cal. Civ. Code § 1794(d). “By permitting prevailing buyers to 27 recover their attorney fees in addition to costs and expenses, [the California] Legislature has 1 lawsuit might not otherwise have been economically feasible.” Murillo v. Fleetwood Enters., Inc., 2 17 Cal. 4th 985, 994 (1998). This statutory right to attorneys’ fees and costs is available to 3 “consumers who successfully achieve the goals of their litigation through a compromise 4 agreement.” Wohlgemuth v. Caterpillar Inc., 207 Cal. App. 4th 1252, 1263 (2012). 5 California courts use the lodestar analysis to determine reasonable attorneys’ fees under 6 Civil Code section 1794(d). Robertson v. Fleetwood Travel Trailers, Inc., 144 Cal. App. 4th 785, 7 818-19 (2006); Nightingale v. Hyundai Motor Am., 31 Cal. App. 4th 99, 104 (1994). The lodestar 8 amounts to “the number of hours reasonably expended multiplied by the reasonable hourly rate.” 9 PLCM Grp. v. Drexler, 22 Cal. 4th 1084, 1095 (2000). This “lodestar analysis is generally the 10 same under California law and Federal law.” Base v. FCA US LLC, No. 17-cv-01532-JCS, 2020 11 WL 363006, at *2 (N.D. Cal. Jan. 22, 2020) (quoting Rodriguez v. Cty. of Los Angeles, No. 10-cv- 12 6342, 2014 WL 8390755, at *2 (C.D. Cal. Dec. 29, 2014)). 13 The party seeking fees bears the initial burden of establishing the hours expended litigating 14 the case. Levy v. Toyota Motor Sales, U.S.A., Inc., 4 Cal. App. 4th 807, 816 (1992); Corbett v. 15 Hayward Dodge, Inc., 119 Cal. App. 4th 915, 926 (2004); see Welch v. Metro. Life Ins. Co., 480 16 F.3d 942, 945-46 (9th Cir. 2007). The party must provide sufficient documentation of the tasks 17 completed and the amount of time spent. See Ketchum v. Moses, 24 Cal. 4th 1122, 1132 (2001); 18 Bernardi v. Cty. of Monterey, 167 Cal. App. 4th 1379, 1398 (2008); see also Camacho v. 19 Bridgeport Fin., Inc., 523 F.3d 973, 980 (9th Cir. 2008). The requesting party also must show that 20 the “[t]he reasonable hourly rate is that prevailing in the community for similar work.” PLCM 21 Grp., 22 Cal. 4th at 1095; see also Carson v. Billings Police Dep’t, 470 F.3d 889, 891 (9th Cir. 22 2006). “[T]he awarding of attorney fees is a highly fact-specific matter best left to the trial court’s 23 discretion.” Graciano v. Robinson Ford Sales, Inc., 144 Cal. App. 4th 140, 155 (2006). 24 Fee awards calculated under the lodestar method generally are presumed to be reasonable. 25 PLCM Grp., 22 Cal. 4th 1084 at 1097. However, the lodestar may be adjusted upwards or 26 downwards based on certain factors in order to “fix a fee at the fair market value for the particular 27 action.” Ketchum, 24 Cal. 4th at 1132. “In effect, the court determines, retrospectively, whether 1 augmentation of the unadorned lodestar in order to approximate the fair market rate for such 2 services.” Id. 3 III. DISCUSSION 4 Wu seeks a lodestar award of $13,638 for 27.7 hours of work performed by his counsel at 5 the law firm of Kaufman and Kavicky, including work on this fee motion. He requests a 6 multiplier of 1.2 to 1.5. Mot. at 2; Agyeman Decl. ¶ 5. He also seeks $725.80 in costs. Mot. at 2. 7 A. Reasonableness of Hourly Rates 8 Courts must consider “the hourly amount to which attorneys of like skill in the area would 9 typically be entitled.” Ketchum, 24 Cal. 4th at 1133. “The rates of comparable attorneys in the 10 forum district are usually used.” Heritage Pac., 215 Cal. App. 4th at 1009.; see also Syers 11 Properties III, Inc. v. Rankin, 226 Cal. App. 4th 691, 700 (2014) (“The determination of the 12 ‘market rate’ is generally based on the rates prevalent in the community where the court is 13 located.”). Typically, “affidavits of the plaintiffs’ attorneys and other attorneys regarding 14 prevailing fees in the community, and rate determinations in other cases . . . are satisfactory 15 evidence of the prevailing market rate.” Heritage Pac., 215 Cal. App. 4th at 1009 (quoting United 16 Steelworkers of Am. v. Phelps Dodge Corp., 896 F.2d 403, 407 (9th Cir. 1990)); see Cardoso v. 17 FCA US LLC, No. 20-cv-02250-JSC, 2021 WL 1176532 (N.D. Cal. Mar. 29, 2021). See also Civ. 18 L.R. 54-5(b)(3) (a fees motion must be accompanied by an affidavit with “[a] brief description of 19 relevant qualifications and experience and a statement of the customary hourly charges of each 20 such person or of comparable prevailing hourly rates or other indication of value of the services.”). 21 The Kaufman & Kavicky law firm is based in Los Altos, which is within the Northern 22 District of California. Wu requests a $495 hourly rate for associate Isaac Agyeman and a $650 23 rate for work performed by partner Scott R. Kaufman. Agyeman has practiced law for nine years 24 and worked on lemon law cases such as this one since 2014. Agyeman Decl. ¶ 13. He has 25 litigated “hundreds of cases against auto manufacturers,” the majority of which have settled. Id. 26 Kaufman has practiced law for twenty-four years and has represented “thousands of 27 consumers throughout the state of California in lemon law and auto fraud matters.” Id. ¶ 14. He 1 taught many courses and presented at conferences on lemon law and auto fraud. Id.2 2 BMW challenges Kaufman and Agyeman’s requested rates and asks the court to apply 3 lower rates of $500 and between $295 to $350, respectively. Opp’n at 7-8. BMW relies on Kasai 4 v. Mercedes-Benz USA LLC, No. RG17859919 (Alameda Cty. Super. Ct. July 15, 2020), in which 5 the court awarded Kaufman a $500 hourly rate. See id. at 7; Agyeman Decl. Ex. E at 4-5. As for 6 Agyeman, BMW points to decisions in this judicial district awarding lower rates to attorneys with 7 similar experience. 8 In determining the hourly rates for Kaufman and Agyeman, the court declines to consider 9 cases cited by Wu from the Central and Southern Districts of California. These cases involve 10 lawyers practicing outside this market. The decisions also do not discuss the lawyers’ experience, 11 so the court cannot determine whether they are appropriate comparators for determining the rates 12 for the lawyers in this case. See Mot. at 8-9; Reply at 3-4.3 Similarly, the cases cited by BMW are 13 distinguishable because they involve hourly rates for attorneys based outside the Bay Area and at 14 least one of the cases is not a lemon law matter.4 As another court in this district noted with 15

16 2 Wu did not submit sworn declarations by attorneys of comparable experience to support the 17 requested $495 and $650 as reasonable hourly rates for litigating Song-Beverly cases in the San Francisco Bay Area. Instead, Agyeman states what several California plaintiffs’ attorneys told 18 him were their 2021 lemon law case rates. Agyeman Decl. ¶ 15. The court declines to consider this hearsay information. Also, because Agyeman’s description omits key information such as the 19 market in which the lawyers practice, the court cannot determine if the rates are relevant to this 20 dispute. See Ketchum, 24 Cal. 4th at 1133 (requiring courts to consider the comparable rates in the “community” or “area”). 21 Wu also points to three Song-Beverly cases that resulted in substantial fee awards. Mot. at 10. None of them are probative. Reasonable fees must be determined case by case. This matter 22 settled shortly after it was filed in state court then removed. The three cases cited by Wu all went 23 through trial and appellate review. 3 On reply, Wu addresses Base v. FCA US LLC, 2020 WL 363006, at *4-5, but that case also 24 involves Southern California-based lawyers. Sherman v. Mr. Scooter, No. CGC-20-582007 (S.F. 25 Super. Ct. July 9, 2021), in which Wu’s counsel was awarded fees under Civil Code section 1794(d), also does not shed light on the subject because the order does not provide the attorneys’ 26 hourly rates. 27 4 BMW’s non-lemon law decision, In re Volkswagen “Clean Diesel” Mktg., Sales Pracs., & Prod. Liab. Litig., No. 6903, 2020 WL 2086368, at *3 (N.D. Cal. Apr. 30, 2020), involves an attorneys’ 1 respect to a similar Song-Beverly Act suit, “the prevailing rates charged in the San Francisco legal 2 market are among the highest in the state.” Bratton v. FCA US LLC, No. 17-cv-01458-JCS, at *5 3 (N.D. Cal. Oct. 22, 2018) (noting that the “relevant forum” for consideration is the San Francisco 4 Bay Area). Accordingly, the court declines to consider rates for markets outside of this judicial 5 district. 6 Agyeman did not submit any evidence or court decision sufficient to support his requested 7 $495 hourly rate. The court finds persuasive the recent fee award in Snider v. General Motors, 8 LLC, No. 21CV000671 (Monterey Cty. Super. Ct. Dec. 10, 2021), in which a state court within 9 the geographic boundary of this judicial district applied a 2021 hourly rate of $450 for Agyeman.5 10 See Declaration of Isaac S. Agyeman (“Agyeman Decl. II”) Ex. B [Docket 21-3.] This rate finds 11 further support in the United States Consumer Attorney Fee Survey Report cited in Cardoso, 2021 12 WL 1176532, at *3 (noting a $450 average hourly rate for consumer attorneys in San Francisco 13 with 6-10 years of experience). The court thus awards Agyeman a 2021 rate of $450. 14 With respect to Kaufman, Agyeman’s declaration states in a conclusory manner that 15 Kaufman’s current (i.e., 2022) hourly rate is $650. Wu does not provide any additional evidence 16 or court decision to support the requested rate. BMW points out that in Kasai, No. RG17859919, 17 in which the court awarded $55,080.30 to Wu’s counsel, the court found the requested rates 18 “excessive” and applied a 2020 hourly rate of $500 for all of the plaintiff’s attorneys, including 19 Kaufman. Opp’n at 7; Agyeman Decl. Ex. E. The court also applied a multiplier of 1.5 “in light 20 of [Kaufman’s] years and depth of experience.” Agyeman Decl. Ex. E. In response, Kaufman 21 avers that at the hearing in Kasai, he explained to the court that he “very much appreciated the 22 multiplier, but, that the hourly rate was lower than one she had personally given [him] years 23 earlier.” Declaration of Scott Kaufman (“Kaufman Decl.”) ¶¶ 3-4 [Docket No. 21-4.] The court 24 “asked [him] if [he] wanted to change it to [his] requested hourly rate and give up on the 25 multiplier,” but he “declined to accept that offer.” Id. ¶ 4. It is pointless to speculate about how 26

27 5 Nearly all of the work on Wu’s case was performed in 2021. There are only 3 billing records in 1 the judge in Kasai arrived at her decision to award Kaufman a 2020 rate of $500 plus a 1.5 2 multiplier. This court finds that a 2021 rate of $500 is low for Kaufman, a Bay Area-based partner 3 who has litigated lemon law cases for 24 years, particularly given that his associate Agyeman has 4 established a $450 hourly rate based on 8 years of experience. The court awards Kaufman a 2021 5 rate of $600. This rate finds support in the United States Consumer Attorney Fee Survey Report 6 cited in Cardoso, 2021 WL 1176532 at *3 (noting a $638 average hourly rate for consumer 7 attorneys in San Francisco with 26-30 years of experience). 8 Finally, Wu seeks fees for two non-lawyers at $195 and $150 hourly rates for a total of 9 $270. He does not provide any information about their roles or backgrounds; he simply includes 10 their timeslips in his exhibits without explanation or foundation. See Agyeman Decl. Ex. A; 11 Opp’n at 7; Reply at 4; see generally Mot. Because Wu fails to provide any foundational evidence 12 supporting the fee request for these two individuals in violation of this court’s local rules, the court 13 declines to award fees for them. See Civ. L.R. 54-5(b)(3); see Base v. FCA US LLC, 2020 WL 14 363006, at *5 (declining to award fees where declaration does not state experience or 15 qualifications to determine a reasonable rate). 16 B. Reasonableness of Hours Expended 17 Next, the court “must carefully review attorney documentation of hours expended.” 18 Ketchum, 24 Cal. 4th at 1132. “The attorneys’ submissions form the starting point for the trial 19 court’s determination of the ‘hours reasonably expended’ component of the lodestar analysis.” 20 Christian Rsch. Inst. v. Alnor, 165 Cal. App. 4th 1315, 1324 (2008) (internal citations omitted); 21 see also Civ. L.R. 54-5(b)(2) (requiring “[a] statement of the services rendered by each person for 22 whose services fees are claimed, together with a summary of the time spent by each person, and a 23 statement describing the manner in which time records were maintained.”). “‘Reasonably spent” 24 means that time spent ‘in the form of inefficient or duplicative efforts is not subject to 25 compensation.’” Horsford, 132 Cal. App. 4th at 394 (quoting Ketchum, 24 Cal. 4th at 1132). The 26 defendant “bears the burden of providing specific evidence to challenge the accuracy and 27 reasonableness of the hours charged.” McGrath v. Cty. of Nevada, 67 F.3d 248, 255 (9th Cir. 1 Wu’s counsel billed a total of 27.7 hours, including time spent litigating this fee motion. 2 The requested hours are supported by itemized timeslips. Agyeman Decl. ¶¶ 4-5, Ex. A. BMW 3 objects to certain timeslips. First, BMW contends that Agyeman should not have billed a total of 4 0.6 hours on September 2, 13, and 27, 2021 for communications he initiated regarding the 5 vehicle’s surrender as part of the repurchase process. BMW explains that ordinarily, “a third-party 6 reaches out to the Plaintiff or Plaintiff’s counsel and schedules a surrender date,” and asserts that 7 Agyeman should not have made “multiple unilateral attempts to contact the third-party.” Opp’n at 8 5. In response, Wu explains that the third-party reacquisition coordinator reached out to Wu’s 9 counsel first. Reply at 3. Agyeman then followed up with two different individuals to schedule 10 the vehicle surrender, which apparently occurred on September 28, 2021. Agyeman Decl. II ¶¶ 3- 11 4. The court is satisfied by this explanation of Agyeman’s back-and-forth with the third-party 12 surrender service, which amounted to slightly over half an hour of time and does not point to any 13 inefficiencies in how Agyeman litigated the case. 14 BMW also challenges 2.5 hours billed by Agyeman to draft written discovery requests 15 because Agyeman did not ultimately serve those them. Id. at 4-5; see Declaration of Mark W. 16 Allen (“Allen Decl.”) ¶ 4 [Docket No. 20-1] (attestation by BMW’s counsel that “[d]uring the 17 pendency of this litigation, my office has not been served with any discovery from Plaintiff in this 18 matter”). Wu responds that the bills do not actually include that time, and that BMW’s challenge 19 “reflects a poor understanding of Plaintiff’s billing records.” Reply at 1, 3. Wu’s records are, in 20 fact, confusing on this point. Agyeman’s March 22, 2021 time slip shows a billing of 2.5 hours 21 for “Draft[ing] written discovery requests to Defendant (including special interrogatories, requests 22 for admission, and request for production).” Agyeman Decl. Ex. A at 5. However, the total time 23 and expense summary indicates 2.5 hours of non-billable time for Agyeman. See Agyeman Decl. 24 Ex. B. After performing its own review and calculations, the court finds that Wu has, in fact, 25 excluded the 2.5 hours at issue from his fee request. 26 BMW further disputes 0.4 hours billed by Kaufman for an “initial conference with 27 referring attorney,” which BMW posits was “vague and unnecessary given that Plaintiff’s counsel 1 Agyeman Decl. Ex. A at 5. Finally, BMW challenges as “duplicative” two timeslips billed by 2 Agyeman on August 6, 2021 of 0.1 hour each described as “[r]eceive and review follow up email 3 from opposing counsel re: status of settlement agreement.” Opp’n at 6; see Agyeman Decl. Ex. A 4 at 3. According to BMW’s counsel, “I have searched my inbox for email communications to and 5 from Plaintiff’s counsel for August 6, 2021 and have only found one email communication” about 6 the settlement agreement. Allen Decl. ¶ 2. Wu does not respond to these remaining objections 7 and therefore concedes them. Accordingly, the court reduces 0.1 hours from Agyeman’s total and 8 0.4 hours from Kaufman’s total. Because Wu does not offer any support for the two non-lawyer 9 timekeepers, as discussed above, the court does not award the requested $270 for their time. 10 C. Multiplier 11 “[T]he Song-Beverly Act permits the trial court to award a multiplier where it deems 12 appropriate under the lodestar adjustment method.” Base, 2020 WL 363006, at *2; see Robertson, 13 144 Cal. App. 4th at 819. The court considers “(1) the novelty and difficulty of the questions 14 involved, (2) the skill displayed in presenting them, (3) the extent to which the nature of the 15 litigation precluded other employment by the attorneys, (4) the contingent nature of the fee 16 award.” Ketchum v. Moses, 24 Cal. 4th 1122, 1132 (2001). However, “a trial court should not 17 consider these factors to the extent they are already encompassed within the lodestar.” Id. at 1138. 18 “[A] trial court should award a multiplier for exceptional representation only when the quality of 19 representation far exceeds the quality of representation that would have been provided by an 20 attorney of comparable skill and experience billing at the hourly rate used in the lodestar 21 calculation.” Id. at 1139. “[T]he party seeking a fee enhancement bears the burden of proof.” Id. 22 at 1138. 23 Wu asks the court to apply a multiplier between 1.2 and 1.5. Mot. at 12. He argues that a 24 multiplier is warranted due to (1) the delay in receiving payment; (2) his counsel’s quality, skill, 25 and results obtained; (3) the extent that litigating this case precluded his counsel from taking on 26 other matters, and (4) the contingent nature of the fee award. Id. He also observes that his counsel 27 “ha[s] received quite a few multipliers over the years.” Id. 1 Wu’s counsel. A greater enhancement is not warranted because this case did not involve any 2 || novel or complex issues and the contingency risk was low and of brief duration. 3 D. Costs 4 Wu seeks an award of $725.80 in filing and service-related expenses related to this 5 litigation. The Song-Beverly Act authorizes the court to award to the prevailing party all costs and 6 || expenses “reasonably incurred by the buyer in connection with the commencement and 7 prosecution of this action.” Jensen v. BMW of N. Am., Inc., 35 Cal. App. 4th 112, 137-38 (1995); g || see Cal. Civ. Code § 1794(d). BMW does not oppose this award. Accordingly, the court finds g || these costs reasonable. 10 |} IV. CONCLUSION 11 Based on the foregoing, the court grants in part and denies in part Wu’s motion for

= 12 || attorneys’ fees and costs. The court awards Wu’s counsel $13,084.50 in fees based on a lodestar

& 13 of $11,895, enhanced by a 1.1 multiplier, in accordance with the following calculations: Billing Rate $450 $10,575.00 16 $600 $1,320.00 Lodestar Total $11,895.00 17 Lodestar x 1.1 multiplier $13,084.50

Z 18 19 The court also awards $725.80 in costs. In light of the parties’ settlement of all claims in 29 || matter, the Clerk shall close the case and enter judgment in accordance with this order. 2] AES DISTRIGS 9 IT IS SO ORDERED. SD CS » A) { 33 || Dated: July 18, 2022 i 1s Bane ae Ryu 24 | White: tes Magistrate Judge} < = 25 Ryu □□ ge Donne M © 26 PS A) 27 oN OY Ly OS 28 DISTRICS