What you get in a California lemon law case, item by item

Search for "lemon law settlement" and you will find sites promising an "average settlement" or a typical range. We do not publish those numbers, because no public data supports them: most lemon law cases settle privately, and every recovery depends on the price of the vehicle, how it was financed, its repair history and how the manufacturer behaved. What the law does provide is a clear list of what a lemon law settlement can include. That list is what you should measure any offer against.

This guide goes through each part of the recovery under California's Song-Beverly Consumer Warranty Act, shows the offset formula with a labeled hypothetical, and ends with reported California verdicts and appellate rulings with sources. It is general information as of October 2026, not legal advice about your vehicle.

The two main remedies: a refund or a replacement

Under Civil Code § 1793.2(d)(2), when a manufacturer cannot fix a new motor vehicle to match its warranty after a reasonable number of attempts, it must promptly replace the vehicle or make restitution, and "the buyer shall be free to elect restitution in lieu of replacement." The choice is yours, not the manufacturer's.

What restitution (a buyback) includes

Section 1793.2(d)(2)(B) sets the refund. It equals:

• The price paid or payable. "The actual price paid or payable by the buyer," including transportation charges and manufacturer-installed options. California's jury instruction, CACI No. 3241, describes this as the amount paid to date, including finance charges, plus any amount still owed. The instruction's notes cite a 2000 appellate decision, Mitchell v. Blue Bird Body Co., allowing recovery of paid finance charges.
• Collateral charges such as sales or use tax, license fees, registration fees and other official fees.
• Incidental damages under § 1794, "including, but not limited to, reasonable repair, towing, and rental car costs actually incurred by the buyer."

Some things are left out. The statute excludes "nonmanufacturer items installed by a dealer or the buyer." In Valdovinos v. Kia Motors America (2024), the Court of Appeal held that an optional service contract sold by a third party was not part of the price paid and could not be recovered as incidental damages. On the other side, in Niedermeier v. FCA US (2024) the California Supreme Court held that a trade-in credit or sale proceeds do not reduce restitution when the buyer was forced to trade in or sell the vehicle because the manufacturer did not comply with the Act.

In practice, the manufacturer usually pays your lender the loan payoff and pays you the rest. For manufacturers that opted in to the 2025 procedures, Code of Civil Procedure § 871.27 adds rules on third-party add-ons, rolled-in negative equity, rebates and payment timing; our AB 1755 guide lists them.

The mileage offset

The manufacturer may subtract an amount for your use of the vehicle before the problem first appeared at the shop. Under § 1793.2(d)(2)(C), the offset is the price paid or payable multiplied by a fraction: the miles driven before you first delivered the vehicle for repair of the problem, divided by 120,000.

Hypothetical example (not a real case): A buyer paid a total of $40,000 for a new SUV. The first repair visit for the defect happened at 6,000 miles. The offset is $40,000 × 6,000 ÷ 120,000 = $2,000. Every number here is invented to show the math. CACI No. 3241 also notes that the offset price is the purchase price including transportation and manufacturer-installed options, which is not always the same as the total you paid. Try your own numbers in our lemon law buyback calculator.

What a replacement includes

Under § 1793.2(d)(2)(A), the manufacturer must provide "a new motor vehicle substantially identical to the vehicle replaced," with the usual warranties, and pay the sales or use tax, license fees, registration fees and other official fees on the replacement, plus incidental damages. The same mileage offset can apply, paid by you. Replacement is less common, often because a buyer has lost confidence in the model.

Incidental and consequential damages

Civil Code § 1794(b) ties lemon law damages to the Commercial Code's sales remedies, including Commercial Code § 2715, which covers incidental and consequential damages. Examples that often come up:

• towing, rental cars and rideshares while the vehicle was in the shop;
• repair bills you paid out of pocket for the defect;
• registration renewal fees in some cases. In Kirzhner v. Mercedes-Benz USA (2020), the California Supreme Court held that renewal and nonoperation fees can be incidental damages if they were incurred after the manufacturer's duty to provide a refund or replacement arose and because it failed to do so, as Snell & Wilmer summarized;
• other losses that flow directly from the defect, which must be proved with receipts and records.

Two limits are worth knowing. CACI No. 3241's notes cite decisions holding that emotional distress damages are generally not recoverable under the Act. And every incidental cost needs paper: keep receipts, rental agreements and screenshots of rideshare charges.

The civil penalty: up to two times actual damages

A civil penalty is extra money on top of your actual damages. It is not automatic. Under § 1794(c), if the buyer proves the manufacturer's failure to comply was willful, the judgment may add a penalty of up to two times the actual damages. Section 1794(e) provides a second penalty route for new-vehicle buyback violations without a willfulness finding, but it is not available against a manufacturer that maintains a qualified dispute program and requires a written notice; our arbitration vs. lawsuit guide explains that rule. A buyer cannot collect both penalties for the same violation.

Hypothetical: if a jury found actual damages of $30,000 and a willful violation, it could award a penalty of anywhere from $0 to $60,000. The maximum is a cap, not a target.

For manufacturers that opted in to the 2025 procedures, a buyer who wants a civil penalty must first send a written notice at least 30 days before suing, and the manufacturer can avoid the penalty by making and completing a qualifying offer in time (Code of Civil Procedure § 871.24).

Attorney's fees and costs

Under § 1794(d), a buyer who wins "shall be allowed" to recover costs and expenses, including attorney's fees "based on actual time expended," as determined by the court. The fees are paid by the manufacturer, on top of your recovery. In settlements, fees are usually negotiated separately or set by the court on a motion.

Courts have rejected cutting fees just because the damages were modest. In Warren v. Kia Motors America, the Court of Appeal reversed a fee award that had been reduced partly to keep it proportional to a jury verdict of $17,455.57. Our guide to who pays attorney's fees in a lemon law case covers how fee recovery works and what it means for you.

"Cash and keep" offers

Not every resolution is a buyback. Manufacturers sometimes offer a payment while you keep the vehicle. The statute has no formula for these offers, so the only way to judge one is against what a buyback and a penalty might be worth on your facts. Read our guide on buyback offers and cash-and-keep deals before you accept one.

Reported California verdicts and rulings

These are reported results in California cases handled by other lawyers. They are not LaCour results. Amounts are as stated in the cited opinions; several were changed on appeal.

Every case is different. Past results, including those listed here, do not predict the outcome of any other case. Reported appellate cases are also not a random sample: they are the cases that went to trial and were appealed, which most do not.

Before you accept any offer

1. Write down what you paid: down payment, every monthly payment, the loan payoff, taxes and fees.
2. Find the mileage on the first repair order for the defect. That number drives the offset.
3. Gather receipts for towing, rentals, rideshares and out-of-pocket repairs.
4. Check whether the offer includes attorney's fees and how they are paid.
5. Read the release. For opted-in manufacturers, only a standardized release form may be required.
6. Do not sell or trade in the vehicle until you have advice; it can affect a civil penalty claim.

How LaCour approaches the numbers

We build each claim from your documents, line by line, using the statute rather than a guess. Our California lemon law team reviews cases free, in English or Spanish, and when a lemon law claim succeeds the manufacturer pays the attorney's fees.

Frequently asked questions

This guide is general information about California and federal law and about public records as of its date. It is not legal advice, and reading it or contacting us does not create an attorney–client relationship. Allegations in lawsuits are claims, not findings. Prior results do not guarantee a similar outcome. Attorney advertising.