Zargarian v. BMW of N. Am., LLC

442 F.Supp.3d 1216

Henrik ZARGARIAN, Plaintiff,

v.BMW OF NORTH AMERICA, LLC et al, Defendants.

CV 18-4857-RSWL-PLA

United States District Court, C.D. California.

Filed March 3, 2020

Brian Tate Shippen-Murray, Michael H. Rosenstein, Law Offices of Michael H. Rosenstein LC, Dara Tabesh, Ecotech Law Group PC, Gregory Sogoyan, Payam Shahian, Caitlin J. Scott, Carey B Wood, Christine J. Haw, Jacob William Cutler, Kyle Raine Tracy, Strategic Legal Practices APC, Los Angeles, CA, for Plaintiff.

ORDER re: Plaintiff's Motion for Prejudgment Interest [81]; Plaintiff's Motion for Attorney Fees, Costs, and Expenses [83]; Plaintiff's Application to the Clerk to Tax Costs [82]

HONORABLE RONALD S.W. LEW Senior U.S. District Judge

Plaintiff Henrik Zargarian("Plaintiff ") brings this Action for violations of the Song-Beverly Consumer Warranty Act and fraud against Defendant BMW of North America, LLC.¹ ("Defendant"). Currently before the Court is Plaintiff's Motion for Prejudgment Interest [81], Plaintiff's Motion for Attorney Fees, Costs, and Expenses ("Motion for Fees") [83], and Plaintiff's Application to the Clerk to Tax Costs ("Application to Tax Costs") [82]. Having reviewed all papers submitted, the Court NOW FINDS AND RULES AS FOLLOWS: the Court DENIES Plaintiff's Motion for Prejudgment Interest; GRANTS in part Plaintiff's Motion for Fees; and GRANTS in part Plaintiff's Application to Tax Costs.

I. BACKGROUND

A. Factual Background

On or about June 18, 2014, Plaintiff purchased a 2011 BMW 750LI ("Vehicle"), which was manufactured and distributed by Defendant. Compl. ¶ 7, ECF No. 1-1. In connection with Plaintiff's purchase of the Vehicle, Defendant provided an express written warranty by which it undertook to preserve or maintain the utility or performance of the Vehicle, or to provide compensation if there was failure of such performance within a specified amount of time. Id. ¶ 8.

During the warranty period, Plaintiff alleges that the Vehicle contained or developed several engine defects, battery defects, oil consumption defects, fuel injector defects, and timing chain defects. Id. ¶ 9. The Oil Consumption Defect is allegedly a "safety concern because it prevents the engine from maintaining the proper level of engine oil and causes voluminous oil consumption that cannot be reasonably anticipated or expected." Id. ¶ 39. The defect can cause engine failure at any time, "thereby exposing the driver, ... passengers, and others on the road to serious risk of accident and injury." Id.

Plaintiff alleges that Defendant and its representatives, after a reasonable number of opportunities, were unable to service the Vehicle to conform to the warranty. Id. ¶ 10. Defendant did not promptly replace the Vehicle, provide restitution, or buyback the Vehicle. Id. ¶¶ 10-11.

Plaintiff also alleges that Defendant knew or should have known of the Vehicle's defects, but failed to disclose this information to Plaintiff before he acquired the Vehicle. Id. ¶ 41. Plaintiff claims that Defendant became aware of the defects through sources not available to consumers such as Consumer Reports, customer complaints, pre-release testing data, and aggregate data from BMW dealers. Id. ¶¶ 42, 38, 43, 53.

Plaintiff contends that, had he known the Vehicle's engine was defective, he would not have purchased the Vehicle. Id. ¶ 63.

B. Procedural Background

Plaintiff filed his Complaint [1-1] in California State Court on December 27, 2019. The Complaint alleges six claims: (1) violation of Civil Code section 1793.2, subdivision (d) ; (2) violation of Civil Code section 1793.2, subdivision (b) ; (3) violation of Civil Code section 1793.2, subdivision (a)(3) ; (4) breach of express warranty; (5) breach of the implied warranty of merchantability; and (6) fraud. Compl. ¶¶ 7-67. On February 20, 2018, Defendant filed its Answer [1-2]. Subsequently, Defendant timely removed [1].

On October 23, 2019, the Court granted Defendant's Motion for Judgment on the Pleadings as to Plaintiff's sixth claim for fraud [30]. The parties engaged in a contested discovery period, and on November 19, 2019, Defendant accepted Plaintiff's California Code of Civil Procedure § 998 offer [79]. Accordingly, the Court entered Judgment for Plaintiff [80].

On December 19, 2019, Plaintiff filed the instant Motion for Prejudgment Interest [81], Motion for Fees [83], and Application to Tax Costs [82]. Defendant opposed [85, 87, 89], and Plaintiff timely replied [90-92].

II. DISCUSSION

A. Legal Standard

1. Motion for Prejudgment Interest

For federal cases sitting in diversity, "state law determines the rate of prejudgment interest ...." Citicorp Real Estate, Inc. v. Smith, 155 F.3d 1097, 1107 (9th Cir. 1998). Further, the Song-Beverly Act does not preclude an award of prejudgment interest. Doppes v. Bentley Motors, Inc., 174 Cal.App.4th 1004, 94 Cal. Rptr. 3d 797, 801-02 (2009). California Civil Code Section 3827 governs the recovery of prejudgment interest, and states, in relevant part: "[a] person who is entitled to recover damages certain, or capable of being made certain by calculation, and the right to recover which is vested in the person upon a particular day, is entitled also to recover interest thereon from that day." Cal. Civ. Code § 3287(a).

Further, Section 3287(b) states that "[e]very person who is entitled under any judgment to receive damages based upon a cause of action in contract where the claim was unliquidated, may also recover interest thereon from a date prior to the entry of judgment as the court may, in its discretion, fix, but in no event earlier than the date the action was filed." Courts have taken the following factors into consideration when determining whether to exercise their discretion to award prejudgment interest: (1) the time between the lawsuit's filing and the judgment, (2) whether awarding interest will penalize the defendant for "litigating a bona fide dispute" or recognize that the plaintiff incurred "an additional amount of damage" as a result of the breach, and (3) whether the plaintiff made settlement offers such that the defendant's refusal to settle could be construed as "placing the prejudgment interest amount at risk." Forouzan v. BMW of N. Am., LLC, No. CV-1-73875-DMG-GJSX, 2019 WL 856395, at *3 (C.D. Cal. Jan. 11, 2019) (citing A&M Produce Co. v. FMC Corp., 135 Cal.App.3d 473, 186 Cal. Rptr. 114, 129 (1982) ).

2. Motion for Fees

Under California Civil Code Section 1794, the "prevailing buyer" in a Song-Beverly action "shall be allowed by the court to recover as part of the judgment a sum equal to the aggregate amount of costs and expenses, including attorney's fees." Cal. Civ. Code § 1794(d). The Ninth Circuit utilizes the lodestar method for calculating reasonable attorneys' fees, "multiplying the number of hours reasonably expended on the litigation by a reasonable hourly rate." Welch v. Metro. Life Ins. Co., 480 F. 3d 942, 945 (9th Cir. 2007). The burden is on the party seeking fees to establish their reasonableness. Id. at 945-46 (citing Hensley v. Eckerhart, 461 U.S. 424, 437, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983) ).

In determining a reasonably hourly rate, the district court should consider: (1) the experience, reputation, and ability of the attorney; (2) the outcome of the proceedings; (3) customary fees; and (4) the novelty or difficulty of the question presented. Hiken v. Dep't of Def., 836 F. 3d 1037, 1044 (9th Cir. 2016) (citing Chalmers v. City of L.A., 796 F.2d 1205, 1211 (9th Cir. 1986) ). Additionally, district courts may "rely[ ] on their own knowledge of customary rates and their experience concerning reasonable and proper fees." Ingram v. Oroudjian, 647 F. 3d 925, 928 (9^th Cir. 2011).

District courts have broad "discretion in determining the amount of a fee award ... in view of [their] superior understanding of the litigation and the desirability of avoiding frequent appellate review of what essentially are factual matters." Hensley, 461 U.S. at 437, 103 S.Ct. 1933. The "district court may exclude from the fee request any hours that are ‘excessive, redundant, or otherwise unnecessary.’ " Ingram, 647 F.3d at 926 (quoting Hensley, 461 U.S. at 434, 103 S.Ct. 1933 ). If a court determines that some hours billed are not reasonable, it may exclude them using one of two methods: the court may either conduct an "hour-by-hour analysis" of the fee request or make an "across the board percentage cut." Gonzalez v. City of Maywood, 729 F.3d 1196, 1203 (9th Cir. 2013).

B. Discussion

1. Requests for Judicial Notice

Under Federal Rule of Evidence 201, "a court may take judicial notice of matters of public record," but "a court may not take judicial notice of a fact that is subject to reasonable dispute." Lee v. City of L.A., 250 F.3d 668, 688-89 (9th Cir. 2001) (internal quotations and citations omitted). Court filings are also properly subject to judicial notice under Federal Rule of Evidence 201. See Reyn's Pasta Bella, LLC v. Visa USA, Inc., 442 F.3d 741, 746 n.6 (9th Cir. 2006) (noting that courts may take judicial notice of "court filings" as they are "readily verifiable, and therefore, the proper subject of judicial notice"). Furthermore, judicial notice of proceedings in other courts is appropriate "if those proceedings have a direct relation to matters at issue." U.S. ex rel. Robinson Rancheria Citizens Council v. Borneo, Inc., 971 F.2d 244, 248 (9th Cir. 1992) ; see Coalition for Clean Air v. VWR Intern., LLC, 922 F. Supp. 2d 1089, 1093 n.1 (E.D. Cal. 2013).

a. Plaintiff's Request for Judicial Notice

In support of his Motion for Fees, Plaintiff requests that the Court take judicial notice of certain documents that are matters of public record. See Request for Judicial Notice in Supp. of Mot. for Fees, ECF No. 83-34. Defendant opposes Plaintiff's request. See Def.'s Obj. to Request for Judicial Notice in Supp. of Mot. for Fees, ECF No. 87-3.

Plaintiff requests that the Court take judicial notice of the following: (1) a February 27, 2014 minute order...