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MacQuiddy v. Mercedes-Benz USA, LLC

California Court of Appeals, Second District, Eighth Division

January 2, 2015

RAND MACQUIDDY, Plaintiff and Appellant,
MERCEDES-BENZ USA, LLC, Defendant and Respondent.

APPEAL from a judgment of the Superior Court of Los Angeles County, No. BC488675 Michael L. Stern, Judge.

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[Copyrighted Material Omitted]

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Romano Stancroff and Mark Romano for Plaintiff and Appellant.

LeClairRyan and Peter M. Hart for Defendant and Respondent.



After experiencing problems with his Mercedes-Benz that required multiple repair attempts, plaintiff Rand MacQuiddy filed suit against

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defendant Mercedes-Benz USA, LLC (Mercedes-Benz) under the Song-Beverly Consumer Warranty Act (Civ. Code, § 1790 et seq.; the Act) and the federal Magnuson-Moss Warranty—Federal Trade Commission Improvement Act (15 U.S.C. § 2301). MacQuiddy sought a refund for the car and a civil penalty for the alleged willful violation of the Act. In its answer to the complaint, Mercedes-Benz admitted it had not been able to conform the car to the applicable warranties within the time frames set forth in the Act. Mercedes-Benz also admitted it had not yet replaced the car or made restitution, but asserted it would offer to reimburse MacQuiddy as required under the Act. MacQuiddy subsequently rejected a statutory offer to compromise in which Mercedes-Benz offered to repurchase the car for an amount consistent with the Act, and to pay MacQuiddy’s attorney fees and costs incurred up to that point. Because Mercedes-Benz admitted liability for failure to repurchase or replace the car under the Act, and the parties stipulated to a restitution amount, trial proceeded only on MacQuiddy’s claim for a civil penalty. A jury found Mercedes-Benz did not willfully fail to comply with the Act.

On appeal, MacQuiddy contends the trial court erred in denying his motion to compel discovery responses and in granting a protective order that prevented him from taking two “persons most knowledgeable” depositions. MacQuiddy further challenges the trial court order denying his motion for attorney fees, denying in part his motion for costs, and awarding Mercedes-Benz its costs. We reverse the trial court order’s costs order, but otherwise affirm.


In February 2010, MacQuiddy bought a 2010 Mercedes-Benz E550 C two-door coupe. On one occasion in August 2011, he could not get the car to start. The same thing happened on three separate occasions in November 2011, January 2012, and May 2012. After each incident, MacQuiddy took the car to the W.I. Simonson dealership for repair. In May 2012, the dealership kept the car for approximately 30 days.

During the May to June 2012 period when the car was in the shop, MacQuiddy spoke with a service adviser at the dealership twice a week to “ascertain [the] status” of the car, and to determine “if there was anything that [he] could do to help to try and move things along.” MacQuiddy wanted his car back and was frustrated that the shop could not find and solve the problem. Sometime between June 10th and 12th, MacQuiddy called Mercedes-Benz customer assistance at the suggestion of the dealership. At trial, MacQuiddy testified: “It was suggested to me by the dealership... that I contact... Mercedes-Benz USA because they were still having... problems... getting... feedback on... what the problem might be. And

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also that... it was now to the point where there might be some form of... compensation that might be due.”

The customer service representative said he had the records of the service visits. MacQuiddy asked if there was anything the representative could do to “escalate it to where the technical team could get more involved with [the] car so [he] could get [his] car back.” MacQuiddy testified as to the representative’s response: “He directed me... back to W.I. Simonson and said that... further work... further follow-through and contact should go through them and that they would make sure that the technical team worked with the... people at the dealership.” According to MacQuiddy, the representative said he understood and respected that MacQuiddy had experienced a lot of trouble and there would be “some type of compensation through [sic], but he did not say what type.” MacQuiddy neither requested that Mercedes-Benz repurchase the car, nor discussed a buyback with the representative. MacQuiddy testified the conversation ended with MacQuiddy thanking the representative and the representative: “direct[ing] me to... further conversations to go through the dealer.” MacQuiddy understood that he would work with the service adviser at the dealership.

A day or two after the conversation, the dealership informed MacQuiddy his car was ready to be picked up. The service adviser told MacQuiddy that Mercedes-Benz would contact him. MacQuiddy did not hear from Mercedes-Benz again. He did not try to contact the company. After approximately one month, he contacted a lawyer.[1] On July 20, 2012, MacQuiddy filed suit alleging claims under the Act and the Magnuson-Moss Warranty—Federal Trade Commission Improvement Act. MacQuiddy sought rescission of the purchase contract and restitution of the money he had paid for the car, as well as a civil penalty of two times his actual damages.

In late August 2012, Mercedes-Benz answered the complaint. In the answer, the company admitted that it or its authorized repair facility was unable to conform MacQuiddy’s car to the applicable express and implied warranties after a reasonable number of attempts, or within 30 days. Mercedes-Benz further admitted it had “not yet replaced the new motor vehicle or [made] restitution in accordance with the Act” but stated it would “offer to reimburse Plaintiff under the Act, in an amount equal to the actual price paid or payable by Plaintiff, including any charges for transportation and manufacturer-installed options... and including any collateral charges such as sales or use tax, license fees, registration fees, and other official fees, plus any incidental damages to which Plaintiff is entitled, including but not limited to, reasonable repair, towing, and rental car costs actually incurred by

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Plaintiff.” The answer admitted MacQuiddy was entitled to revoke acceptance of the car under the Act and was entitled to reimbursement of the price paid, “less that amount directly attributable to use by the Plaintiff prior to discovery of the nonconformities.” The answer further admitted MacQuiddy was entitled to the “aggregate amount of costs and expenses, including attorney’s fees, reasonably incurred in connection with the commencement and prosecution of this action.”

Section 998 Offer

In late September 2012, Mercedes-Benz served MacQuiddy with an offer to compromise pursuant to Code of Civil Procedure section 998 (section 998). The offer contained the following term: “Pursuant to California Code § 1793.2(d)(2), MBUSA offers to repurchase Plaintiff’s 2008 [sic] Mercedes-Benz E550 (“E550”)... in an undamaged condition, save normal wear and tear, for the amount of the vehicle down payment, any and all payments made, and the amount of Plaintiff’s outstanding loan obligation related to the purchase of the subject vehicle, if any, as well as any collateral charges and incidental costs in accordance with Civil Code § 1793.2(d)(2)(B), less a reasonable mileage offset in accordance with Civil Code § 1793.2(d)(2)(C), all to be determined by court motion if the parties cannot agree.” The offer further provided Mercedes-Benz would pay “Plaintiff’s recoverable court costs, expenses, and reasonably-incurred attorney fees pursuant to Civil Code § 1794(d) to be determined by the Court by way of a noticed motion.” The offer indicated the fee and cost amount would be calculated as if MacQuiddy was found to have prevailed in a Civil Code section 1794, subdivision (d) action as of the date of the offer, except that Mercedes-Benz would not be liable for a multiplier greater than 1.0 and MacQuiddy could “recover for fees and costs reasonably and actually incurred in bringing such a fee/cost motion.”

MacQuiddy objected to the offer and did not accept it.

Discovery Issues

In November 2012, MacQuiddy moved to compel discovery responses from Mercedes-Benz. The motion concerned 11 special interrogatories, 19 document requests, and 13 requests for admissions. The discovery requests related to Mercedes-Benz’s actions in MacQuiddy’s case, as well as Mercedes-Benz’s general practices and policies, and the E550 C in general. For example, the requests included such topics as all inspections of MacQuiddy’s car; all contacts Mercedes-Benz had with anyone regarding the car; the dates the car was at ...

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