Minnesota Supreme Court Rules: when awarding attorney fees courts should consider the amount involved in litigation

Posted on April 29th, 2013 by Legal Fee Advisors

In February 2013, the Supreme Court of Minnesota reversed the district court’s decision, awarding a total of $221,499 in attorney fees to a consumer who prevailed in a suit against a vehicle lessor under Minnesota’s lemon law. In doing so, the Court directed the trial court to consider whether such fees were proportionate to the economic result obtained. (Green v BMW of N. Am., LLC, 826 NW2d 530 [Minn. 2013]).

The consumer of a leased vehicle filed a suit against BMW of North America, LLC, claiming that the leased vehicle was defective.Following a four day bench trial, the District Court of Hennepin County, awarded the plaintiff $25,157, as a full refund of the vehicle’s lease price minus a 10 percent statutory allowance for reasonable use plus the costs plaintiff had incurred in renting a substitute vehicle. After trial, the consumer-plaintiff brought a motion for an award of $231,101 in attorney fees and $7,565 in litigation costs pursuant to Minnesota’s lemon law and the Magnuson-Moss Act. Both statutes allow successful consumer-plaintiffs to recover costs, including reasonable attorney fees. The district court awarded plaintiff $221,499 in attorney fees and $7,565inlitigation costs, and the court of appeals affirmed.

Following BMW’s petition for review, however, the Supreme Court of Minnesota reversed and remanded the district court’s decision, for further proceedings consistent with its opinion. The Supreme Court held that the lodestar method is an appropriate method for calculating reasonable attorney fees, and that the district court abused its discretion in determining reasonable attorney fees, without taking into account the proportionality between the amount involved in the litigation and the amount of attorney fees claimed.

The lesson to be learned here is that many courts have and will continue to weigh the size of an award, and balance the proposedlegal fees of the victorious party against the result obtained. In attempting to send a message that general principles of fairness count, the Minnesota SupremeCourt implies here that plaintiff’s counsel would do well to consider the potential that over-the-top fee petitions will be weighed and adjusted downward to bring such fees in line with the economic benefit to the client.


E. Tutovic | D. Paige

Legal Fee Advisors © 2013

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