ESTEBAN MARQUEZ ET AL VS KIA MOTORS AMERICA INC

Tentative Rulings

Case Number: ****6522    Hearing Date: August 05, 2020    Dept: 32

Background

Plaintiffs Esteban Marquez and Karina Villa (collectively, Plaintiffs) commenced this action against Defendant Kia Motors America, Inc. (Kia) on December 14, 2017. The operative pleading is the Second Amended Complaint (SAC) filed on March 7, 2019. The SAC asserts causes of action for violation of the Song-Beverly Act and fraud arising from Plaintiffs’ purchase of a 2013 Kia Optima. Kia’s demurrer to the fraud claims was sustained without leave to amend.

This case went to trial from February 19, 2020 to February 26, 2020. The jury returned a special verdict finding that Kia had not breached the applicable warranties or the Song-Beverly Act. Judgment was entered in Kia’s favor on March 16, 2020.

Legal Standard

Except as otherwise expressly provided by statute, a prevailing party is entitled as a matter of right to recover costs in any action or proceeding. (CCP ; 1032(b).)

The statutory scheme for cost recovery establishes three categories of trial preparation expenses: (1) one category allowable as a matter of right to the prevailing party (CCP ; 1033.5(a)), (2) one category disallowable unless expressly authorized elsewhere by law (CCP ; 1033.5(b)), and (3) one category allowable or disallowable in the court’s discretion (CCP ; 1033.5(c)(4)). Even where costs are deemed allowable, costs are only recoverable to the extent that they are (1) reasonably necessary to the conduct of the litigation rather than merely convenient or beneficial to its preparation and (2) reasonable in amount. (CCP ; 1033.5(c)(2), (3).)

“In ruling upon a motion to tax costs, the trial court’s first determination is whether the statute expressly allows the particular item and whether it appears proper on its face. ‘If so, the burden is on the objecting party to show [the costs] to be unnecessary or unreasonable.’ [Citation.] Where costs are not expressly allowed by the statute, the burden is on the party claiming the costs to show that the charges were reasonable and necessary. [Citation.] ‘Whether a cost item was reasonably necessary to the litigation presents a question of fact for the trial court and its decision is reviewed for abuse of discretion.’ [Citation.]” (Foothill-De Anza Community College Dist. v. Emerich (Foothill) (2007) 158 Cal.App.4th 11, 29-30.)

Discussion[1]

Plaintiffs move to tax Kia’s Memorandum of Costs (MOC).

A. Filing Fees

In the MOC, Kia seeks filing and motion fees of $515.

Plaintiffs claim that this cost item should be reduced by $60 because Kia’s filing fee for an ex parte application for an order to continue trial was not reasonably necessary to the conduct of the litigation. Plaintiffs claim that this application “only served to delay and impede the resolution of this action.” In response, Kia explains that it filed the ex parte application because its designated expert witness and its PMK were unavailable for trial on the trial date previously set. (Tallent Decl. ¶¶ 16-17, 22.) Trial was ultimately continued on this basis. (Tallent Decl. ¶ 18.) Kia has shown that this cost was reasonably necessary to this litigation.

The Court has not taxed the MOC on this basis.

B. Deposition Costs

In the MOC, Kia seeks deposition costs of $6,851.30.

Plaintiffs seek to tax this item of costs by “at least” $622.45. Plaintiffs claim that Kia impermissibly seeks to recover costs related to (1) physical media used in depositions ($335), (2) a rough transcript ($94.95), and (3) a transcript of a proceeding ($193). Plaintiffs also demand further information about Kia’s deposition costs of $375.60 for its expert Vincent Petrangelo.

Plaintiffs’ argument is partly persuasive. Kia can recover physical media costs under section 1033.5(c). The invoices and supporting attorney declaration show that these physical media costs incurred across several depositions are reasonable in amount and were reasonably necessary to the litigation. (Tallent Decl. ¶ 23.) Kia cannot recover costs for the rough or finalized versions of the transcripts because the transcripts pertain to court proceedings and the transcripts were not court-ordered. (CCP ; 1033.5(b)(5) (disallowing costs for “transcripts of court proceedings not ordered by the court”).) Regardless of the transcripts’ importance to Kia’s litigation conduct, Kia cannot recover these costs unless the transcripts were court-ordered. (Opp. at 5; Tallent Decl. ¶ 19.) Finally, the MOC contains an invoice for the deposition of Vincent Petrangelo stating that costs of $375.60 were incurred for the deposition transcript, exhibit pages, flash drive exhibit, and “binding/shipping/handling.” Kia’s counsel explains that the flash drive contained vehicle inspection photographs and was used in the Petrangelo deposition. (Tallent Decl. ¶ 24, Ex. D.) Based on the invoices and the attorney declaration, the Court concludes that the Petrangelo deposition costs are reasonable in amount and are reasonably necessary to the litigation.

The Court taxes the MOC by $287.95 on this basis.

C. Deposition Costs

In the MOC, Kia seeks $9,780.55 in costs for models, enlargements, and photocopies of exhibits.

Plaintiffs seek to tax this cost item by $8,579.08 because (1) almost none of the photographs or exhibits charged for were used at trial and (2) the costs are duplicative and were not reasonably necessary to the litigation.

Plaintiffs’ first point is not supported by the majority of appellate courts which have assessed this issue. As noted by the Second District Court of Appeal in June 2020, “there is a split in authority on whether costs related to exhibits ultimately not used at trial are recoverable.” (Segal v. Asics America Corporation (2020) 50 Cal.App.5th 659.) Several cases, including Segal, have held that costs for exhibits not used at trial are recoverable as discretionary costs because these costs are not specifically allowable under subdivision (a) and not specifically prohibited under subdivision (b). (Benach v. County of Los Angeles (2007) 149 Cal.App.4th 836, 856; Applegate v. St. Francis Lutheran Church (1994) 23 Cal.App.4th 361, 364-65.) Segal also concluded that costs for exhibits not used at trial are recoverable as allowable costs under subdivision (a)(13). Conversely, one published case has determined that costs for exhibits not used at trial are not recoverable as discretionary costs. (Seever v. Copley Press, Inc. (2006) 141 Cal.App.4th 1550, 1559), and two published cases have determined that costs for exhibits not used at trial are not recoverable as allowable costs under subdivision (a)(13) (ibid.; Ladas, supra, 19 Cal.App.4th at 775)). The Ladas court reasoned that costs for exhibits not used at trial are not allowable costs under subdivision (a)(13) because such exhibits are not “reasonably helpful to aid the trier of fact.” The Seever court reasoned that because “the Legislature has expressly stated in subdivision [(a)(13)] what is allowable (exhibits used at trial that are reasonably helpful) and implicitly what is not, the discretion granted in section 1033.5 subdivision (c)(4), to award costs for items not mentioned in section 1033.5 is simply inapplicable.” (Id. at 1559-60.)

Like the majority of appellate courts which have examined this issue, the Court finds that costs for exhibits not used at trial are recoverable, at minimum, as discretionary costs under subdivision (c). As noted by the Segal court, these costs should be recoverable in order to “reflect the reality of how complicated cases are tried. As the Benach and Applegate courts acknowledged, prudent counsel must prepare exhibits and demonstratives well in advance of trial. Given that trials are unpredictable, however, it is difficult for even the most experienced trial lawyers to divine which exhibits and demonstratives will in fact be used. Consequently, it is in counsels’ (and their clients’) interests to come to trial with copies of all exhibits and demonstratives reasonably anticipated for use in hand.”

Because the exhibit costs are recoverable as discretionary costs, the question becomes whether Kia has shown that these exhibit costs are reasonable in amount and reasonably necessary to this litigation. Kia has submitted invoices showing that these costs were actually incurred for services provided by Excelsior Digital (Excelsior). (MOC, Attach. 12.) Kia’s counsel stresses that the costs were both reasonably necessary to the conduct of the litigation and reasonable in amount. (Tallent Decl. ¶ 26.) According to Kia’s counsel, Kia “paid $9,780.55 to Excelsior for the purpose of obtaining copies of trial exhibits in compliance with the Court’s requirements regarding preparation of trial documents and exhibits.” (Tallent Decl. ¶ 25.) Kia “had to prepare exhibits to defend against every argument plaintiffs might have raised at trial. It was also necessary to put the exhibits into a form in which the exhibits could be easily accessed, or to assemble the exhibits.” (Tallent Decl. ¶ 26.) Kia’s counsel points out that Plaintiffs identified more potential exhibits to be presented at trial, utilized hundreds of color photographs, and reprinted and recopied their exhibits for some undisclosed reason. (Tallent Decl. ¶¶ 27-29.) Kia’s counsel also points out that Plaintiffs have not identified any exhibit which was irrelevant or could not have been used at trial.

Kia has shown that these exhibits costs were reasonable in amount and reasonably necessary to this litigation. Plaintiffs’ arguments to the contrary offer nothing more than conjecture.

The Court has not taxed the MOC on this basis.

D. Electronic Filing or Service Costs

In the MOC, Kia seeks $444.84 in fees for electronic filing or service.

Plaintiffs seek to tax this item of cost by $123. Plaintiffs claim that this cost is for an “unknown filing” so Plaintiffs have no means of knowing whether the cost is reasonable in amount or reasonably necessary to the conduct of the litigation. In response, Kia’s counsel explains that this cost was incurred in order to reserve a hearing date for its demurrer and motion to strike. (Tallent Decl. ¶ 32, Ex. H.) Plaintiffs provide no response in reply.

The Court finds this cost to be reasonable in amount and reasonably necessary to the conduct of the litigation. The Court has not taxed the MOC on this basis.

Conclusion

Plaintiffs’ motion to tax costs is granted in small part. The Court taxes the MOC by $287.95.