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Goglin v. BMW of North America, LLC

California Court of Appeals, Fourth District, First Division

October 21, 2016

NANCY GOGLIN, Plaintiff and Respondent,
v.
BMW OF NORTH AMERICA, LLC, et al., Defendants and Appellants

          APPEAL from a judgment of the Superior Court of San Diego County, No. 37-2013-00065336-CU-BC-CTL, Joan Marie Lewis, Judge.

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[Copyrighted Material Omitted]

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         COUNSEL

         Lehrman Law Group, Kate S. Lehrman and Robert A. Philipson for Defendant and Appellant BMW of North America, LLC.

         Arent Fox, John D. Bronstein and Steven A. Haskins for Defendant and Appellant GMG Motors, Inc., doing business as BMW of San Diego.

         Michael E. Lindsey for Plaintiff and Respondent.

         Opinion by McConnell, P. J., with Benke and O'Rourke, JJ., concurring.

          OPINION

          [208 Cal.Rptr.3d 647] McCONNELL, P. J.

         I

         INTRODUCTION

         BMW of North America, LLC (BMW North America), and GMG Motors, Inc., [208 Cal.Rptr.3d 648] doing business as BMW of San Diego (BMW San Diego) appeal from a judgment awarding Nancy Goglin over $185,000 in attorney fees and costs for successfully settling her claims under the Song-Beverly Consumer Warranty Act (Song-Beverly Act) (Civ. Code, § 1790 et seq.) and other consumer protection statutes. Both BMW North America and BMW San Diego contend Goglin is not entitled to any attorney fees or costs because BMW San Diego offered an appropriate remedy before Goglin filed her complaint, which Goglin unreasonably refused to accept. Alternatively, BMW San Diego contends the fee award should be reduced because there is insufficient evidence to show Goglin's counsel's hours worked and hourly rate were reasonable given the litigation's lack of risk and complexity. We are not persuaded by these contentions and affirm the judgment.

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         II

         BACKGROUND

         In April 2011 Goglin entered into a retail installment sales contract to purchase a used 2008 BMW 535i from BMW San Diego. The total sale price for the vehicle was $45,762, payable in 60 monthly installments of $762.70.

         In June 2013 Goglin sent BMW North America and BMW San Diego a letter asserting they violated the Consumers Legal Remedies Act (Consumers Act) (Civ. Code, § 1750 et seq.) in multiple respects by selling her a used vehicle with prior collision damage and a protracted history of mechanical failure.[1] She requested they remedy the violation by unwinding the transaction, refunding her payments, reimbursing her for her reasonable expenses, and paying off her outstanding loan balance. She also requested they enter a stipulated injunction requiring them " to disclose collision damage in writing, prior to sale, and in particular, disclose if the BMW Certified Pre Owned program actually allows sale of vehicles with prior collision damage."

         In July 2013 BMW San Diego responded to Goglin with a letter questioning her claims. BMW San Diego nonetheless offered to resolve the matter by repurchasing the vehicle for all costs incurred by Goglin, including paying off her existing loan and reimbursing her for her down payment and any loan payments she made, less an offset for depreciation due to her use of the vehicle (see Nelson v. Pearson Ford Co. (2010) 186 Cal.App.4th 983, 1012-1013 [112 Cal.Rptr.3d 607]) and any material damage to it. BMW San Diego also offered to reimburse Goglin for reasonable attorney fees. The offer was contingent upon Goglin agreeing to a general release and to dismissing BMW San Diego with prejudice from any lawsuit she may have filed. Among its terms, the proposed settlement and release agreement included a waiver of the provisions of Civil Code section 1542[2] and a confidentiality and nondisparagement [208 Cal.Rptr.3d 649] clause.[3]

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         In August 2013 Goglin countered with a letter to BMW San Diego indicating she would accept BMW San Diego's offer to the extent the offer was to reimburse her in full for the vehicle without offsets. She indicated she had thus far made payments totaling $19,830.20, with $24,932 still owing on her loan. She also estimated her incidental and consequential damages to be $1,800. She declined to sign the proposed settlement and release agreement " with its contingencies, waivers, denial of liability, and confidentiality requirements," including the waiver of the provisions of Civil Code section 1542 and the requirement for dismissal of her case with prejudice, stating the applicable consumer protection laws " do not require that consumers waive their rights in order to have a dealer comply with statutory obligations."

         In September 2013 Goglin filed a complaint against BMW North America and BMW San Diego for violating the Song-Beverly Act, the Consumers Act, and other consumer protection acts. More particularly, she alleged the vehicle she purchased had numerous defects, including engine and electrical system defects, which BMW North America and BMW San Diego were unable to repair during the applicable warranty period. She further alleged BMW North America and BMW San Diego were obliged to and failed to promptly replace or make restitution for the vehicle. Among other relief, the complaint prayed for compensatory damages in the amount of $45,762, consequential and incidental damages in an unspecified amount, a civil penalty of twice the amount of Goglin's total damages, and reasonable attorney fees and costs. The complaint also prayed for an injunction to prevent further similar misconduct.

         BMW San Diego answered the complaint with a general denial and 24 alleged affirmative defenses. BMW North America answered the complaint with general and specific denials and 42 alleged affirmative defenses.

         The parties engaged in discovery,[4] which included Goglin noticing the deposition of BMW North America's person most qualified to testify regarding BMW North America's used vehicle certification program, its communications with Goglin, its reasons for not repurchasing or replacing her vehicle, its policies and procedures for complying with " the Lemon Law," and its

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arbitration or dispute resolution process.[5] The deposition notice included a request for production of six ...


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