Goglin v. BMW of North America, LLC
4 Cal. App. 5th 462
| Cal. Ct. App. | 2016Background
- Goglin bought a used 2008 BMW 535i from BMW of San Diego in April 2011 for $45,762. She later alleged substantial prior collision damage and repeated mechanical defects.
- Before suit, BMW San Diego offered to repurchase the car and reimburse costs but conditioned the offer on a broad release, a Civil Code §1542 waiver, and a confidentiality/nondisparagement clause; Goglin refused those terms.
- Goglin filed a complaint (Song‑Beverly Act, Consumers Legal Remedies Act, other consumer statutes). Defendants answered with denials and many affirmative defenses; discovery and motion practice followed.
- Defendants later offered statutory Code Civ. Proc. §998 compromise and other settlement proposals; litigation proceeded and the case settled in November 2014 for $75,000 (less loan balance) and separate resolution of attorney fees; no release/confidentiality clause was required in the final settlement.
- Goglin moved for $200,249.19 in fees and costs; the trial court found hours reasonable, reduced counsel’s hourly rate from $625 to $575, and awarded $180,262.50 in fees plus $4,951.69 costs (total $185,214.19).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Goglin is barred from fees because she refused a prelitigation repurchase offer | Goglin refused only unlawful/extraneous terms (broad release, §1542 waiver, confidentiality) and therefore reasonably declined the offer | Defendants say Goglin unreasonably rejected an appropriate prelitigation remedy and thus is not entitled to fees | Court held Goglin reasonably rejected the offer because it contained unlawful/extraneous nonfinancial conditions; fees not barred |
| Whether prelitigation offers made litigation unnecessary, rendering claimed hours unreasonable | Goglin needed to pursue litigation to vindicate Song‑Beverly rights and counter defenses; discovery and preparation were necessary | Defendants contend acceptance would have avoided litigation; litigation work was unnecessary and inflated | Court found record showed defendants did not engage to remove unlawful conditions and litigation work was reasonably necessary; hours reasonable |
| Whether counsel’s requested hourly rate was excessive | Goglin offered declarations, prior awards, and her agreed contingent rates supporting $575 (and $625) hourly rates | Defendants relied on their own counsel’s much lower billing rates as evidence the rates should be reduced | Court exercised discretion, credited evidence and firsthand observation, reduced $625 to $575 (as previously represented) and found $575 reasonable |
| Whether Benson (Consumers Act) controls denial of fees here | Goglin distinguished Benson as a Consumers‑Act case with different notice/settlement rules and not addressing Song‑Beverly confidentiality prohibition | Defendants relied on Benson to argue a timely corrective offer bars fees | Court held Benson inapposite; Song‑Beverly differs and offers conditioned on unlawful confidentiality/releases cannot automatically bar fees |
Key Cases Cited
- McKenzie v. Ford Motor Co., 238 Cal.App.4th 695 (2015) (rejecting denial of fees where plaintiff reasonably refused settlement conditioned on unlawful confidentiality/release terms under Song‑Beverly)
- Doppes v. Bentley Motors, Inc., 174 Cal.App.4th 967 (2009) (standard of review and deference to trial court’s fee determinations)
- Nightingale v. Hyundai Motor Am., 31 Cal.App.4th 99 (1994) (Song‑Beverly fee statute requires court to assess actual time and reasonableness of hours/rate)
- Benson v. S. Cal. Auto Sales, Inc., 239 Cal.App.4th 1198 (2015) (interpreting Consumers Act corrective offer rule; held appropriate correction within 30 days can preclude fees under Consumers Act)
- Gezalyan v. BMW of N. Am., LLC, 697 F.Supp.2d 1168 (C.D. Cal. 2010) (district court recognizing a plaintiff may reject repurchase offers conditioned on non‑statutory confidentiality/releases and still recover fees under Song‑Beverly)