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Ruiz v. BMW of North America, LLC

United States District Court, C.D. California

May 7, 2018

JOE RUIZ SR. and JOE RUIZ JR., Plaintiff,
v.
BMW OF NORTH AMERICA, LLC, and DOES 1 through 10, inclusive, Defendants. Date Complaint/Problem Area Date Att'y Rate Task Time Fee Reason to Strike Date Att'y Rate Task Time Fee Reason to Strike

          ORDER DENYING DEFENDANT'S MOTION FOR NEW TRIAL [103]; GRANTING, IN PART, PLAINTIFFS' MOTION FOR ATTORNEYS' FEES [96]; & DENYING PLAINTIFFS' MOTION TO AMEND JUDGMENT [102]

          OTIS D. WRIGHT, II UNITED STATES DISTRICT JUDGE.

         I. INTRODUCTION

         On December 29, 2017, the jury returned a verdict in favor of Plaintiffs Joe Ruiz, Sr. and Joe Ruiz, Jr. and against Defendant BMW of North America, LLC. (Min., ECF No. 84.) The jury found for the Ruizes on their claims for Breach of Express Warranty, and Breach of Implied Warranty, under California's Lemon Law, relating to their purchase of a 2014 BMW 428i. (Spec. Verdict Form, ECF No. 85.) Now, BMW moves for a new trial and/or remittitur (ECF No. 103), and the Ruizes move for attorneys' fees (ECF No. 96), and to amend the judgment to include prejudgment interest. (ECF No. 102.) For the reasons set forth below, the Court DENIES BMW's Motion for New Trial (ECF No. 103), DENIES the Ruizes's Motion to Amend the Judgment (ECF No. 102), and GRANTS, IN PART, the Ruizes's Motion for Attorneys' Fees.[1] (ECF No. 96.)

         II. FACTUAL BACKGROUND & VERDICT

         On May 27, 2014, the Ruizes purchased a new 2014 BMW 428i from an authorized BMW dealer in Irvine, California. (Declaration of Amy Smith (“Smith Decl.”), Ex. A at 108:9-109:17, ECF No. 110-3.) At the time they purchased the vehicle, it had approximately 60 miles on the odometer. (Id. at 109:21-22.)

         The Ruizes presented evidence to the jury that the vehicle exhibited problems from the start:

Date
Complaint/Problem Area

September 2, 2014

Vehicle shakes

September 8, 2014

Rough idle

April 1, 2015

Service engine light on; fuel gauge issues

April 7, 2015

Service engine light on; fuel gauge issues

April 8, 2015, 6:57 p.m.

“cust[omer] has requested to be taken out of the vehicle…”

April 8, 2015, 9:03 p.m.

“[customer states] talking about possible repurchase...”

April 13, 2015

“he would like BMW to repurchase the veh[icle]…”

July 7, 2015

Service engine light on; fuel gauge issues

July 9, 2015

Vehicle shut off on the freeway

July 13, 2015

Customer requests repurchase of vehicle

(Smith Decl., Ex. A 141:3-143:18, Exs. D, G; Declaration of Jacqueline Chinery (“Chinery Decl.”), Exs. A-C, ECF No. 103-2, 103-3, 103-4, 103-5.)

         On July 30, 2015, after several requests and before the Ruizes filed this lawsuit, BMW offered to repurchase the vehicle with a deduction for the approximately 17, 000 miles BMW claimed the Ruizes had driven it. (Chinery Decl., Ex. B.) The Ruizes declined the offer because BMW used 17, 000, rather than 5, 000, miles to calculate the mileage offset, and corresponding refund deduction. (Chinery Decl., Ex. C.)

         At trial, the Court instructed the jury on the elements for Breach of Express Warranty, and Breach of Implied Warranty, both pursuant to California's Song-Beverly Act (the “Act”). (Jury Instr., ECF No. 89.) The jury found that BMW breached the express written warranty provided to the Ruizes by failing to repair the vehicle after a reasonable number of opportunities to do so, and failing to promptly offer to repurchase it. (Spec. Verdict 2-5, ECF No. 85.) The jury also found BMW acted willfully, warranting a maximum civil penalty of twice the total amount of damages. (Id.) The jury determined that BMW had not calculated the correct mileage deduction in its offer to repurchase, and found that the number of miles the vehicle was driven between the time of purchase and breach was 17, 801, as compared to the 17, 886 offered by BMW. (Compare id., with Chinery Decl., Ex. B.) The jury also found in favor of the Ruizes on the implied warranty claim because the vehicle was not the same quality as those generally in the trade, and was not fit for its ordinary purpose. (Spec. Verdict 5-6.)

         On January 29, 2018, the Court entered Judgment in favor of the Ruizes for $170, 076.57. (Judgment, ECF No. 95.) The Judgment included $56, 692.19 in total damages, calculated by adding the purchase price of the vehicle ($55, 970.32), and incidental and consequential damages ($10, 596.50), and subtracting the value of use ($9, 874.63). The value of use was calculated based on the 17, 801 miles the jury found the Ruizes drove the vehicle between purchase and breach. (Spec. Verdict 4- 6.) In addition, the jury awarded twice the total damages ($113, 384.38), as a civil penalty.

         III. LEGAL STANDARDS

         Each party requests relief from the Court on distinct procedural bases, and each has its own legal standard.

         A. Motion for New Trial

         A court may grant a motion for new trial “for any reason for which a new trial has heretofore been granted in an action at law in federal court.” Fed.R.Civ.P. 59(a)(1)(A). One such ground is an excessive award of damages. See Gasperini v. Center for Humanities, Inc., 518 U.S. 415, 437-38 n.22 (1996). In reviewing an award for excessiveness, a court reviews the evidence in a light most favorable to the prevailing party, disturbing only those awards that it concludes are “grossly excessive or monstrous” or are “based on passion or prejudice.” Lambert v. Ackerly, 180 F.3d 997, 1011 (9th Cir. 1999) (en banc) (internal citation omitted). Courts generally defer to a jury's award of damages unless it is “clearly not supported by the evidence.” In re First Alliance Mortg. Co., 471 F.3d 977, 1001 (9th Cir. 2006). “Courts are not free to reweigh the evidence and set aside the jury verdict merely because the jury could have drawn different inferences or conclusions or because judges feel that other results are more reasonable.” Tennant v. Peoria & Pekin Union Ry., 321 U.S. 29, 35 (1944); see also Silver Sage Partners, Ltd. v. City of Desert Hot Springs, 251 F.3d 814, 819 (9th Cir. 2001) (holding that a court “may not grant new trial simply because it would have arrived at different verdict….”).

         A motion for a new trial may be granted on insufficiency of evidence grounds “only if the verdict is against the ‘great weight' of the evidence, or ‘it is quite clear that the jury has reached a seriously erroneous result.'” Venegas v. Wagner, 831 F.2d 1514, 1519 (9th Cir. 1987) (quoting Digidyne Corp. v. Data Gen. Corp., 734 F.2d 1336, 1347 (9th Cir. 1984)); see also Union Oil Co. v. Terrible Herbst, Inc., 331 F.3d 735, 742 (9th Cir. 2003). A new trial under Rule 59(a) is only warranted where the moving party can show that the jury's verdict was “contrary to the clear weight of the evidence, based upon false or perjurious evidence, or involved a miscarriage of justice….” Passantino v. Johnson & Johnson Consumer Prods., 212 F.3d 493, 510 n.15 (9th Cir. 2000) (citing Wharf v. Burlington Northern R.R. Co., 60 F.3d 631, 637 (9th Cir. 1995)).

         B. Motion to Amend Judgment

         Federal Rule of Civil Procedure 59(e) allows a party to move to amend the judgment no later than 28 days after the entry of judgment. District courts have “considerable discretion” when addressing motions to amend a judgment under Rule 59(e). Turner v. Burlington N. Santa Fe R.R. Co., 338 F.3d 1058, 1063 (9th Cir. 2003). However, “a Rule 59(e) motion is an extraordinary remedy, to be used sparingly in the interests of finality and conservation of judicial resources.” Wood v. Ryan, 759 F.3d 1117, 1121 (9th Cir. 2014) (internal quotation marks omitted). “There are four grounds upon which a Rule 59(e) motion may be granted: 1) the motion is necessary to correct manifest errors of law or fact upon which the judgment is based; 2) the moving party presents newly discovered or previously unavailable evidence; 3) the motion is necessary to prevent manifest injustice; or 4) there is an intervening change in controlling law.” Turner, 338 F.3d at 1063 (internal quotation marks, citations, and alterations omitted). “Since these criteria are not actually set forth in the text of Rule 59(e), a court ‘enjoys considerable discretion in granting or denying the motion, ' including for grounds other than those listed above.” United States ex rel. Begole v. Trenkle, No. EDCV0601104VAPOPX, 2012 WL 13071028, at *4 (C.D. Cal. Jan. 26, 2012) (quoting Allstate Ins. Co. v. Herron, 634 F.3d 1101, 1111 (9th Cir. 2011)).

         C. Motion for Attorneys' Fees

         “In an action involving state law claims, we apply the law of the forum state to determine whether a party is entitled to attorneys' fees, unless it conflicts with a valid federal statute or procedural rule.” MRO Commc'ns, Inc. v. Am. Tel. & Tel. Co., 197 F.3d 1276, 1282 (9th Cir. 1999). Documentation submitted in support of a motion for attorneys' fees must apprise the Court of the nature of the activity and should be sufficient to satisfy the Court that the hours expended were actual, non-duplicative, and reasonable. See K.M. ex rel. Bright v. Tustin Unified Sch. Dist., 78 F.Supp.3d 1289, 1303 (C.D. Cal. 2015).

         Reasonableness is generally determined using the “lodestar” method, where a court considers the work completed by the attorneys and multiplies “the number of hours reasonably expended on the litigation by the reasonable hourly rate.” Intel Corp. v. Terabyte Int'l, Inc., 6 F.3d 614, 622 (9th Cir. 1993). The moving party bears the burden of producing evidence that the billing rates and hours worked are reasonable. Id. at 622-23. “Although in most cases, the lodestar figure is presumptively a reasonable fee award, the district court may, if circumstances warrant, adjust the lodestar to account for other factors which are not subsumed within it.” Camacho v. Bridgeport Fin., Inc., 523 F.3d 973, 978 (9th Cir. 2008) (citation omitted).

         IV. DISCUSSION

         A. New Trial Motion

         BMW seeks a new trial because: 1) the two-time civil penalty was excessive, and the result of “passion, prejudice, and bias;” and 2) the award of $10, 596.50 in incidental and consequential damages was contrary to the law. (Mot. 2, ECF No. 103.)

         1. The Civil Penalty Was Supported by the Evidence

         “The Song-Beverly Act ‘regulates warranty terms' and ‘give[s] recourse to the buyer of a new automobile that suffers from the same defect repeatedly, or is out-of-service for cumulative repairs for an extended period.'” Hatami v. Kia Motors Am., Inc., No. SA CV 08-0226 DOC, 2009 WL 1396358, at *2 (C.D. Cal. Apr. 20, 2009) (quoting Murillo v. Fleetwood Enters., Inc., 17 Cal.4th 985, 989-90 (1998)). “The Act ‘is manifestly a remedial measure, intended for the protection of the consumer; it should be given a construction calculated ...


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