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Horvitz & Levy obtained an important win for an automotive manufacturer in this case raising a host of institutional issues involving California’s Song-Beverly Consumer Warranty Act, also known as the lemon law. We worked with trial counsel to convince the trial court to strike a jury award of maximum, two-times civil penalties. On appeal, we then successfully defended the trial court’s grant of a new trial on civil penalties and obtained reversal of several elements of damages awarded by the jury.

Kia appealed several categories of payments awarded as “restitution” by the jury, and plaintiff cross-appealed the trial court’s grant of JNOV and a conditional new trial on statutory civil penalties awarded by the jury for Kia’s allegedly “willful” failure to comply with the Song-Beverly Act.

The Court of Appeal agreed with our damages arguments and affirmed the conditional new trial order on civil penalties. The court helpfully clarified limitations on statutory civil penalties, and used reasoning that validated the propriety of settlement offers made in innumerable cases by various manufacturers whose reasonable offers were rejected by plaintiffs in favor of taking cases to trial to run up statutory attorney fees.  However, the court reversed the trial court’s grant of JNOV on willfulness and civil penalties.  Plaintiff asked the California Supreme Court for review, which was denied.