Section 998 Activity Is A Gestalt As Far As Fee Recovery Under The Song-Beverly Act.
Although unpublished, Regueiro v. FCA US, LLC, Case No. B301772 (2d Dist., Div. 1 Nov. 19, 2020) (unpublished) is an interesting case which involved the intersection between the lemon law fee-shifting provision and CCP § 998 offer provision. In the end, a “reasonable range” rule was endorsed.
What happened in Regueiro was that the lemon law plaintiffs prevailed in a Song-Beverly Act case with a fee-shifting provision on an implied warranty claim (despite losing other claims). A jury awarded $25,586 in favor of the lemon law plaintiffs. However, well before that, the defense provided various defense CCP § 998 offers of $50,000, $92,695, and then $141,00O. After lemon law plaintiff prevailed after trial, they moved to recover $362,467.50 in fees plus a 1.5 multiplier for a total of $543,701.25. The lower court awarded $83,000 in attorney’s fees under the Song-Beverly Act, prompting an appeal by the defense.
The 2/1 DCA affirmed.
The primary appeal challenge was that the lower court failed to limit the fees award to fees incurred as of the time of the initial 998 offer. The Court of Appeal decided that there was no “bright line” rule with respect to considering 998 offers under the Song-Beverly Act rubric. Rather, instead, “the trial court must consider all the circumstances of the individual case to determine if the plaintiff acted reasonably in pursuing litigation after rejecting a section 998 offer.” (Slip Opn., p. 5.) Given that case law, section 998 did not mandate a cessation of attorney’s fees such that the lower court’s refusal to do in connection with a first section 998 “cut off” was no abuse of discretion.
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