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Miliate v. San Diego House of Motorcycles
4th Appellate District, Division One, Case No. D077104
On April 5, 2021, the 4th Appellate District, Division Three affirmed the Superior Court's order concerning Defendant's Motion to Compel Arbitration.
The underlying case involves a motorcycle dealership failing to comply with California’s Rees-Levering Act by selling motorcycles without providing a single document with all sales terms. Instead, the dealership partners with lenders to issue credit cards to consumers. KBK brought a class action against the dealership, San Diego House of Motorcycles, and also are seeking a separate, prospective public injunction on behalf of California consumers.
Mejia v. DACM, Inc.
4th Appellate District, Division Three, Case No. G058112
On August 24, 2020, the 4th Appellate District, Division Three affirmed the Superior Court’s order denying Defendant’s Motion to Compel Arbitration.
The underlying case involves a motorcycle dealership failing to comply with California’s Rees-Levering Act by selling motorcycles without providing a single document with all sales terms. Instead, the dealership partners with lenders to issue credit cards to consumers. KBK brought a class action against the dealership, Del Amo, and also are seeking a separate, prospective public injunction on behalf of California consumers.
The Court of Appeal affirmed the Superior Court’s denial of Del Amo’s Motion to Compel Arbitration. The Court clarified the scope of public injunctive relief under McGill v. Citibank. The Court held that California has a fundamental interest in preserving its consumers’ right to seek public injunctive relief (thereby disposing of Del Amo’s Utah choice of law argument), Mejia clearly prayed for prospective public injunctive relief (distinguishing cases seeking private injunctive relief), and that the arbitration provision bars public injunctive relief in every forum.
On September 15, 2020, the Court certified the case for publication in the Official Reports following receipt of requests for publication from Center for Consumer Law and Economic Justice, National Consumer Law Center, Consumers for Auto Reliability and Safety, Housing and Economic Rights Advocates, and UC Consumer Law Clinic. This landmark decision is now citable in all California courts.
The full text of the decision can be found here. More information about the process for obtaining publication of this important opinion can be found here.
Lee v. FCA US LLC
On August 19, 2020, KBK won a contested fee motion in Alameda County Superior Court in a case brought pursuant to the Song-Beverly Consumer Warranty Act, Cal. Civ. Code §1792, et seq. involving a 2018 Jeep Wrangler. The court awarded KBK 100% of their requested fees and costs, finding as follows:
The Court finds upon its review of the billing records and the history of this case, that the fees incurred by Plaintiff were reasonably incurred in connection with the prosecution of this case to obtain discovery and negotiate a settlement. There is no basis to cut off fees, costs and expenses after May 10, 2019 when there was no firm settlement offer. Plaintiff seeks fees at a reasonable hourly rate of $500 for one attorney (discounted from $650), and $250 for one paralegal.
Defendant argued at the hearing that the Court should not award attorney’s fees and costs after May 10, 2019 as after alleged taxation of the award of the additional attorney’s fees against Plaintiff, the net settlement achieved is in fact less than the settlement offer made on May 10, 2019. The Court allowed the parties supplemental briefing to discuss the issue of whether the tax implications of the attorney’s fee award should affect the Court’s determination of the reasonableness of attorney’s fees incurred after May 10, 2019. Defendant cites to the general proposition that “[a]ttorney time spent on services which produce no tangible benefit for the client is not time ‘reasonably spent.’” (Meister v. Regents of Univ. of California (1998) 67 Cal. App. 4th 437, 452.) However, Defendant fails to provide a single case authorizing the Court to take into account tax implications of an award of attorney’s fees to determine whether a client obtained a tangible benefit from continued litigation or to determine the reasonableness of attorney’s fees. Further, the Court is not persuaded that Plaintiffs calculation of potential taxation of the attorney’s fee award is accurate or that the fees will necessarily be taxed as against Plaintiff to justify taking this novel approach.
Bohannan v. Professional Cycle Parts
Sacramento County Superior Court, Case No. 34-2011-00108983
On March 3, 2017, the Sacramento Superior Court granted final approval in a class action settlement concerning a certified class of motorcycle purchasers who bought motorcycles from Sacramento dealer Professional Cycle Parts ("PCP") financed by lenders through the use of secured credit cards. Joshua Bohannan and the class contend that PCP engaged in unlawful and unfair business practices and violated California's Rees-Levering Automobile Sales Finance Act (Civil Code §2981 et seq.), a law that governs the sale of motor vehicles under conditional sales contracts in connection with these sales. Bohannon and the class contend that PCP sold motorcycles through credit card transactions without making all disclosures in a single document and that PCP failed to provide motorcycle buyers with all documents and financial disclosures required by the Rees-Levering Act for the sale of motor vehicles under conditional sales contracts.
Kemnitzer Barron & Krieg LLP was joined as co-counsel in the case with the law firm Chavez & Gertler LLP.
Melendez v. K Street Finance, Inc. dba Mullen Finance Plan
Orange County Superior Court, Case No. 30-2014-00722412-CU-BT-CXC
Kemnitzer, Barron & Krieg LLP is lead counsel for a class of consumers who brought suit against Mullen Finance Plan concerning the alleged defective notice that Mullen Finance sent to California vehicle owners following the repossession of their automobiles.
On February 3, 2017, the Orange County Superior Court granted Plaintiff’s motion for class certification of a class consisting of “all persons (a) who who purchased a motor vehicle and, as part of that transaction, entered into an agreement subject to California’s Rees-Levering Automobile Sales Finance Act, Civil Code §2981, et seq. (b) whose motor vehicle was repossessed or voluntarily surrendered; (c) who were issued a Notice of Intention to Dispose of Motor Vehicle (“NOI”) by Mullen Finance from May 5, 2010 through February 3, 2017 that gave the consumer the right to reinstate the loan; and (d) against whose account a deficiency balance was assessed. Excluded from the Class are persons (1) whose account were discharged in bankruptcy, and (2) against whom Mullen Finance obtained a judgment in Superior Court.”
Ally Financial Inc., v Angela Lazrovich, et al.
Santa Clara County Superior Court No. CV 195659
Court of Appeals 6th D.C.A. H041197
Kemnitzer, Barron & Krieg prevailed on an appeal brought by objector Patricia Trujillo challenging final approval of a class action settlement. The case involved repossession notices that the class contended did not comply with the Rees Levering Act. When Ally sued Angela Lazrovich to collect the deficiency, she answered and cross-complained with this class action. The terms of the settlement relieved all 16,943 class members of $173,353.00 in disputed debt, provided credit relief, and returned millions of dollars in restitution. Yet, Trujillo contended the notice had failed to advise her of what she thought were potential tax consequences of the settlement. In fact, the Class Notice had stated, “Tax Consequences of Settlement: Any benefits you receive may or may not be the subject of state or federal taxation, depending on your circumstances. Class Counsel are not tax attorneys and you are advised to seek separate legal advice on matters of taxation.” The Superior Court determined this notice to be perfectly adequate, found the settlement to be fair and reasonable, and issued final approval on April 29, 2014. The objector appealed. In an unanimous, unpublished ruling issued September 13, 2016, the Sixth District Court of Appeals found no merit to the objection and affirmed the judgment, paving the way for distribution of the benefits to the class.
Hamm et al v Consumer Portfolio Services, Inc. et al.
Sacramento County Superior Court No.
Court of Appeals 3rd D.C.A. C078147
Kemnitzer, Barron & Krieg prevailed on an appeal brought by objector Jose Gallegos challenging final approval of a class action in another case involving repossession notices. If such notices do not comply with the Rees Levering Act, the lender is barred from collecting any deficiency. When CPS sought to collect the deficiency from Mr. and Mrs. Hamm, they filed this class action on behalf of themselves and 2,189 other class members. The total deficiency balances in dispute totalled $18,158,243.00. The settlement relieved the entire class of the alleged deficiencies, provided credit relief, and returned restitution amounting to hundreds of thousands of dollars. One objector, represented by same lawyer for the objector in Lazrovich, appeared at the final hearing, and made arguments similar to those of Trujillo. Just as the trial court in San Jose had done, the Sacramento Superior Court denied the objection, found the notice to be adequate, and approved the settlement as fair and reasonable. The objector appealed. Like the Sixth Court of Appeals, here the Third District Court of Appeals issued an unpublished, unanimous ruling affirming the judgment and holding that ,“The notice stated the settlement might have tax consequences, which, as the trial court found, was what Gallegos established, nothing more.” The remittitur issued to the trial court on October 30, 2016, enabling distribution of the benefits to the class.
Cordero v. American Honda Finance Corp. dba Honda Financial Services
San Mateo County Superior Court, Case No. CIV531470
On April 15, 2016, the San Mateo Superior Court granted final approval of a class action settlement against American Honda Finance Corp. (“AHFC”). The final approval of the settlement granted relief for a class of consumers who brought suit against AHFC concerning the alleged defective notice that AHFC sent to California vehicle owners following the repossession of their automobiles. The settlement involves 1,954 class members. It required AHFC to cease collection of approximately $8,305,210.28 in unlawful deficiency balances, pay back $809,676.17 in unlawfully collected deficiency balances, and provides for settlement repair to class members, among other settlement provisions. Attorneys’ fees and costs were paid separate and apart from all class recovery.
Kemnitzer, Barron & Krieg LLP is joined as co-lead counsel in the case with the law firm Chavez & Gertler LLP.
A lawsuit entitled Leslie Danielsen, et al. v. La Jolla Group, et al. was filed in the Fresno County Superior Court, Case No.08CECG04387. The lawsuit alleges that the landlord, La Jolla, violated certain California tenant protection laws, including, taking security or security deposits, which exceed the amount legally allowed; and, not providing a statement showing the proposed charges to the tenant; charging tenants for repairs after moving out without timely providing bills or receipts from those who did the work that verify the costs incurred by La Jolla.
On March 2, 2016 Judge Donald S. Black granted preliminary approval of a class action settlement that provides that La Jolla will provide relief to about 2100 Class Members valued in excess of $1,060,000, and reimburse about $191,607.73 to Class Members who had money wrongfully taken from their deposits for repairs or maintenance.
Martinez v. Finance And Thrift Company
A lawsuit entitled Martinez v. Finance and Thrift Company (F&T), was filed in the Superior Court of California, County of Fresno, Case No. 12CECG03998. Plaintiffs alleged that the required “notice of intent to sell” the repossessed vehicle that was sent to Class Members after the repossession of their vehicles did not comply with the law.
On February 5, 2016 Judge Donald S. Black ordered preliminary approval of a class action settlement in which F&T will waive deficiency debts owed by about 2,173 class members totaling about $4,838,313, and reimburse about $1,890 to class members who paid money, and will instruct credit reporting agencies to delete the debt from class members’ credit reports.
A lawsuit entitled Mark R. Jones v. CenterOne Financial Services LLC was filed in the United States District Court for the Northern District of California, Case No.3:14-cv-01673 SI. Plaintiffs alleged that the required “notice of intent to sell” the repossessed vehicles that was sent to Class Members after the repossession of their vehicles did not comply with the law and that CenterOne is not entitled to collect the deficiency debt that CenterOne claims is owed.
On December 28, 2015 Judge Susan Illston ordered preliminary approval of a class action settlement which provides that CenterOne will forgive the entire deficiency balances of about $3,568,957owed by about 528 class members, and refund about $84,552 to class members, and will instruct credit reporting agencies to delete the debt from class members’ credit reports.
Martinez v. Savon Financial, Inc.
A lawsuit entitled Martinez v. Savon Financial, Inc. was filed in the Superior Court of the State of California for the County of Fresno, Case No. 10CECG00873. Plaintiff Bulmaro Martinez-Sanchez alleges that the “notice of intent to sell” the repossessed vehicles sent to class members did not comply with the law and that Savon Financial is not entitled to collect money that Savon is not entitled to collect the deficiency debt that it claims is owed.
On March 4, 2016 Judge Donald S. Black ordered final approval of a class action settlement and entered judgement in favor of the class, which provides that Savon will forgive the entire deficiency balances of about $1,358,012 it alleged was owed by about 563 class members, and will refund about $87,397 to class members who paid money on their accounts, and will instruct credit reporting agencies to delete the debt from class members’ credit reports.
Barry Jekowsky v. BMW of North America, LLC
United States District Court, Northern District of California, San Francisco Division, Case No.: 3:13-cv-02158-VC
On October 29, 2015, the Court granted final approval of a nationwide class action settlement in a class action against BMW of North America, LLC arising out of alleged defects with and the cracking of 296 "V Spoke" Style light alloy wheels installed on certain 2009-2012 model year BMW Z4 (E89) vehicles. Under the terms of the settlement, BMW will reimburse owners and lessees who have already paid out-of-pocket to replace their cracked alloy wheels and will pay to replace the cracked wheels that need replacing, among other provisions. Attorneys' fees and costs were paid separate and apart from all class recovery. More information can be found here.
Kemnitzer, Barron & Krieg, LLP was co-counsel in this case with Chavez & Gertler, LLP.
TK Credit Recovery v. Rafael Macias, and Related Cross-Action
Contra Costa County Superior Court, Case No. C14-00919
On October 9, 2015, the Court granted final approval of a class action settlement in a class action against Meriwest Credit Union ("Meriwest") concerning the alleged defective notice that Meriwest sent to California vehicle owners following repossession of their automobiles. The settlement involved 125 class members and required Meriwest to cease collection on $930,461.14 in assessed deficiency balances, refund approximately $62,977.24 in collected deficiencies, and provides for credit repair to class members, among other settlement provisions. Attorneys' fees and costs were paid separate and apart from all class recovery.
TK Credit Recovery v. John Blaurock, and Related Cross-Action
Alameda County Superior Court, Case No. RG13676609
On October 8, 2015, the Court granted final approval of a class action settlement in a class action against KeyPoint Credit Union ("KeyPoint") concerning the alleged defective notice that KeyPoint sent to California vehicle owners following repossession of their automobiles. The settlement involved 248 class members and required KeyPoint to cease collection on $1,930,507.50 in assessed deficiency balances, refund approximately $180,572.41 in collected deficiencies, and provides for credit repair to class members, among other settlement provisions. Attorneys' fees and costs were paid separate and apart from all class recovery.
United Auto Credit Corporation v. Mesngon, Alameda County Superior Court
On December 16, 2015, the Court granted preliminary approval of a class action settlement against United Auto Credit Corporation ("UACC") concerning the alleged defective notice that UACC sent to California vehicle owners following repossession of their automobiles. The settlement involves 1,414 class members. It requires UACC to cease collection on approximately $5,200,000 in unlawful deficiency balances and to pay back $21,48.08 in unlawfully collected deficiency balances, and provides for credit repair to class members, among other settlement provisions. Attorneys' fees and costs are to be paid separate and apart from all class recovery. The hearing on Final Approval is set for April 1, 2016.
McCaleb v. DT Credit Company, LLC, USDC Central District of California
On May 26, 2015, the Court granted final approval of a class action settlement against DT Credit Company, LLC ("DT Credit") concerning the alleged defective notice that DT Credit sent to California vehicle owners following repossession of their automobiles. The settlement involved 9,784 class members and required DT Credit to cease collection on over $71,000,000 in unlawfully collected deficiency balances, and provides for credit repair to class members, among other settlement provisions. Attorneys' fees and costs were paid separate and apart from all class recovery.
Cisneros v. American General Financial Services, Inc., et al.
USDC, Northern District of California
On November, 13, 2015, KBK obtained final approval of a class action settlement concerning an alleged door-to-door sales scam funded by Springleaf Financial Services, Inc. fka American General Financial Services, Inc. ("Springleaf"). Pursuant to the terms of the settlement, the 118 settlement class members, who had purchased computers and software after being solicited at their home, will receive back nearly all of the money that they paid, and Springleaf has agreed not to take any action to further collect on these alleged debts.
Wallace v. East Bay Motorsports, Inc.
Alameda County Superior Court
On March 4, 2016, Judge Winifred Y. Smith granted final approval of a settlement concerning allegations that East Bay Motorsports, Inc. ("East Bay") did not comply with provisions of California's Rees-Levering Automobile Sales Finance Act when selling motorcycles using open-end financing. Specifically, Plaintiff had alleged that East Bay had developed and implemented a program whereby East Bay drafts installment sales contracts to falsely appear as cash transactions when, in fact, they are financed through a spurious revolving credit scheme. Plaintiff alleged that this resulted in undisclosed and significant financing charges. Pursuant to the terms of the settlement, each of the class members will be receiving back a portion of the amount that they had financed. KBK was co-counsel in this case with Chavez & Gertler, LLP and Shulman Law.
Buzenes v. Nuvell Financial Services LLC
Los Angeles County Superior Court
KBK, together with Chavez & Gertler, LLP and Rosner, Barry & Babbitt, LLP successfully prosecuted a class action against Nuvell Financial Services LLC ("Nuvell") concerning the alleged defective notice that Nuvell sent to California vehicle owners following the repossession of their automobiles. The settlement, which involves 2,897 class members, requires Nuvell to cease collection on $32 million in unlawful deficiency balances and to pay back over $1.2 million dollars, among other things. Judge Elihu M. Berle approved the settlement on December 18, 2015.
