In Garcia v. Mercedes-Benz USA, Inc., a California Court of Appeal declined to award attorney's fees to a plaintiff pursuant to the Song-Beverly Consumer Warranty Act (the Act) when the plaintiff claimed she had prevailed by achieving a confidential settlement with the defendant as a result of her lawsuit.
The plaintiff sued an auto manufacturer seeking reimbursement for the cost of her car and additional add-ons she purchased from a dealership independently of her car purchase from the manufacturer. Eventually the parties signed a confidential settlement that left the issue of attorney's fees open for resolution by a court. When the plaintiff moved for attorney's fees and costs, the trial court denied both.
The plaintiff's right to recover attorney's fees depended on whether she was a "prevailing party" according to the Act. The Court of Appeal discussed a split among the California appellate courts, with one side requiring that a plaintiff obtain a "net monetary recovery" and the other looking to the "extent...the buyer achieves her litigation objectives." The Court chose the latter view, and consequently held that the plaintiff was not entitled to fees because she could not prove that she had prevailed in her litigation: the settlement she obtained was confidential and the defendant had offered to repurchase the car prior to the plaintiff's filing her case. The plaintiff was entitled to recover her costs, however, as she demonstrated that she at least obtained a "partial recovery, as long as it is a net monetary recovery," which the Court found is the applicable standard for recovering costs.
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