Consumer Statutes, Reasonableness Of Fees: Plaintiff Accepting CCP § 998 Settlement Offer In Lemon Law Case Was Properly Awarded Drastically Reduced Attorney’s Fees Where Inflated Billings Were Demonstrated

Higher Claimed Hourly Rates For Riverside Attorneys Properly Reduced, As Well As Inflated Work Effort Requests.

            In contrast to the Edmundson decision which we recently posted on, the 4/3 DCA did affirm a substantially reduced fee award under a lemon law case in Jacobs v. American Honda Motor Co., Inc., Case No. G062739 (4^th Dist., Div. 3 Dec. 8, 2023) (unpublished), with the facts and record being much different in degree.  Jacobs involved a substantial fee request after a CCP § 998 offer was accepted in a non-complex, not hugely contested litigation matter.  Given those facts and the fee “ask,” there are differences which led to a drastic cut in the fees, a determination affirmed by our local appellate court in an opinion authored by Justice Motoike.

            What happened in this case is that defendant in a Song-Beverly Act case, which has a fee shifting statute favoring the car purchaser, made a CCP § 998 offer including a component allowing attorney’s fees to be determined by the lower court (the base offer on the merits was $38,751.06).  Plaintiff accepted that offer, prompting his attorneys to file a fee request for $319,138.50 by the lead attorney and $23,530 by a secondary attorney, with the lead attorney claiming $675 per hour and secondary attorney claiming $650 per hour for a Riverside-venued matter.  The Riverside trial judge set $450 as the reasonable hourly rate for Riverside counsel, but he found lead attorney’s lodestar request was “grossly inflated” based on vague block billing and vague time entries in a routine case which did not involve a lot of pre-trial activity.   In the end, his fee request was reduced to $5,895 but the secondary attorney was granted total work effort but diminished by the lower hourly rate.

            The appellate court affirmed.  The hourly rate determinations were sustained based on the venue and the lower court’s observation of the work effort by plaintiff’s attorneys.  With respect to the big haircut for lead counsel’s fees, that was no abuse of discretion because the bad billing practices by counsel made it difficult to cipher reasonable work effort, resulting in a fee award which is substantially reduced or denied in entirety.  (In re Marriage of Nassimi, 3 Cal.App.5^th 667, 695-696 (2016).)