Shakouri

INTRODUCTION

Code of Civil Procedure section 998 (section 998) is intended to encourage parties to accept reasonable settlement offers before trial. (Linthicum v. Butterfield (2009) 175 Cal.App.4th 259, 270.) To that end, section 998 “establishes a procedure for shifting the costs upon a party’s refusal to settle. If the party who prevailed at trial obtained a judgment less favorable than a pretrial settlement offer submitted by the other party, then the prevailing party may not recover its own postoffer costs and, moreover, must pay its opponent’s postoffer costs.” (Barella v. Exchange Bank (2000) 84 Cal.App.4th 793, 798, citing § 998, subd. (c)(1).) Here, appellant Arash Shakouri sued respondent Tesla Motors, Inc. under the Song-Beverly Consumer Warranty Act (the Song-Beverly Act, Civ. Code, § 1790 et seq.) relating to alleged defects in a Tesla Model S Shakouri purchased in 2014. Tesla extended two informal settlement offers early in the case; Shakouri declined. About six months into the case and after initial discovery, Tesla served a section 998 offer proposing $115,000 to repurchase the vehicle,1 plus attorney fees. Again, Shakouri declined. After nearly three years of…