BMW OF NORTH AMERICA, LLC

v.

MARIE LOUISE HENRY

IN THE DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA FIFTH DISTRICT NOT FINAL UNTIL TIME EXPIRES TO FILE MOTION FOR REHEARING AND DISPOSITION THEREOF IF FILED BMW OF NORTH AMERICA, LLC,

Appellant,

v. Case No. 5D21-885 LT Case No. 2016-CA-001413

MARIE LOUISE HENRY,

Appellee.

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Opinion filed April 8, 2022 Appeal from the Circuit Court for Lake County, Brian Welke, Judge. James H. Wyman, of Hinshaw & Culbertson LLP, Coral Gables, for Appellant. Theodore F. Greene, III, of Law Offices of Theodore F. Greene, LC, Orlando, and Jeremy Kespohl, of Morgan & Morgan, P.A., Jacksonville, for Appellee. PER CURIAM.

BMW of North America, LLC (“BMW”) appeals the trial court’s final judgment awarding attorney’s fees and costs to Marie Henry. BMW primarily argues the trial court erred in determining that Henry was entitled to a contingency multiplier pursuant to the Magnuson-Moss Warranty Act (“MMWA”), 15 U.S.C. §§ 2301–2312. We affirm in part, reverse in part, and remand to the trial court for correction of the attorney’s fee award. Henry successfully sued BMW under the MMWA, and the jury awarded her $11,549.48, reflecting diminished value of her vehicle and incidental and consequential damages.¹ Thereafter, Henry moved for entry of final judgment and for an award of attorney’s fees and costs as a prevailing party pursuant to the MMWA’s fee-shifting provision.² She sought $134,575 in fees as well as a contingency multiplier. where the method used in determining the hourly rate employed in the lodestar calculation does not adequately measure the attorney’s true market value, as demonstrated in part during the litigation; (2) if the attorney’s performance includes an extraordinary outlay of expenses and the litigation is exceptionally protracted; and (3) an attorney’s performance involves exceptional delay in the payment of fees. Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542, 554–56 (2010).

Since Dague, both state and federal courts have acknowledged the prohibition against contingency multipliers under federal fee-shifting statutes, including the MMWA. See Volkswagen of Am., Inc. v. Smith, 690 So. 2d 1328, 1332 (Fla. 1st DCA 1997) (“The trial judge applied a multiplier to enhance the attorney’s fees awarded to Smith under the [MMWA] claim . . . . As the court held in [Dague], it is improper to apply a multiplier to enhance an attorney’s fee if entitlement to fees is based on a fee-shifting statute.”); First Fed. Sav. & Loan Ass’n of Palm Beaches v. Bezotte, 740 So. 2d 589, 591 (Fla. 4th DCA 1999) (applying Dague and reversing trial court’s application of multiplier where fee award was granted under federal feeshifting statute); see also Hous. Specialty Ins. Co. v. Vaughn, 749 Fed. Appx. 800, 803–04, n.4 (11th Cir. 2018) (affirming trial court’s application of multiplier to attorney’s fee award pursuant to Florida statute but recognizing, “if this issue were governed by federal law, a contingency fee multiplier would have been forbidden” (citing Perdue, 559 U.S. at 542; Dague, 505 U.S. at 566–67)).

The Florida Supreme Court has also acknowledged that contingency multipliers are prohibited under federal fee-shifting statutes. See Joyce, 228 So. 3d at 1131 (“While Perdue did not completely close the door on lodestar enhancements under federal law, Perdue clarified that Dague had indeed closed the door on any enhancements based on contingency risk.” (citing Perdue, 559 U.S. at 558)). The court in Joyce addressed the application of a contingency multiplier in the context of a state fee-shifting statute and in doing so, implicitly conceded that if a federal statute were at issue, Dague would control. See id. at 1132 (“[T]his Court is not bound, in interpreting state statutes . . . , by United States Supreme Court precedent interpreting awards of attorney’s fees in federal statutes.” (emphasis added)). In this case, it appears the trial court recognized this body of law but failed to apply it, instead finding that Henry was not seeking a contingency multiplier, but rather an “hourly rate multiplier” pursuant to the standard articulated in Perdue. We disagree. The testimony at the evidentiary hearing demonstrated that Henry’s representation was on a contingency basis. Henry’s counsel acknowledged, “If we don’t win, we don’t get paid.” Henry’s fee expert also testified that the case was taken on a contingency basis and expressly stated, “[T]here is a factual basis for contingency risk multiplier.” Additionally, a review of Henry’s motion for attorney’s fees and supplemental memorandum on the issue establishes that she was seeking a contingency multiplier pursuant to Florida law, not an hourly rate multiplier or an enhancement under Perdue.⁵ The trial court appears to have misunderstood the meaning of a contingency fee in reaching its conclusion. A contingency fee is not simply undertaking representation with the understanding that legal fees will consist of a percentage of the recovery. In consumer cases such as this, representation on that basis would be uneconomical for lawyers, where the likelihood of obtaining a substantial money judgment is relatively low. Representation on a contingency basis also includes representation on an hourly fee basis where it is understood that the lawyer will seek fees only from the adverse party; the client will not be responsible for paying fees in the event of an unsuccessful lawsuit.⁶ See Dague, 505 U.S. at 560–61 (“A fee is certain if it is payable without regard to the outcome of the suit; it is contingent if the obligation to pay depends on a particular result’s [sic] being obtained.”).

Moreover, despite finding that it was applying an hourly rate multiplier pursuant to Perdue, the trial court (1) did not address the three circumstances under which Perdue found a multiplier permissible; and (2) expressly awarded a contingency multiplier of 1.5 pursuant to Joyce. See Perdue, 559 U.S. at 554–56; Joyce, 228 So. 3d at 1135. It did so even after conceding that Joyce was distinguishable insofar as that case dealt with a state fee-shifting statute. As such, the trial court erred in applying a contingency multiplier to Henry’s fee award.

As to the second issue concerning the trial court’s alleged failure to reduce Henry’s fee award, our standard of review is abuse of discretion. Patricia Gail Van Diepen, P.A. v. Brown, 976 So. 2d 38, 39 (Fla. 5th DCA 2008). We find no abuse of discretion in the trial court’s decision not to reduce the fee award as to Henry’s second attorney or for the motion filings BMW categorizes as unnecessary. However, we do find the trial court erred in failing to deduct 2.1 hours for legal work that Henry was unable to detail or describe.

In conclusion, we find the trial court erred as a matter of law in determining that Henry was entitled to a contingency multiplier under the MMWA’s fee-shifting provision. We also find, with one exception, that the trial court did not abuse its discretion in refusing to reduce Henry’s attorney’s fee award. Accordingly, on remand the trial court shall eliminate the contingency multiplier and thereafter reduce the lodestar⁷ fee award by $997.50.8 The resultant attorney’s fee award would be $117,892.50. AFFIRMED IN PART, REVERSED IN PART AND REMANDED. LAMBERT, C.J., EVANDER and COHEN, JJ., concur.