The California Lemon Law (Song-Beverly Act) provides three primary consumer remedies — buyback, replacement vehicle, and cash-and-keep settlement — plus two financial multipliers that dramatically increase total recovery: the civil penalty up to 2× actual damages for willful violations (Civil Code § 1794(c)) and attorney’s fees paid separately by the manufacturer under § 1794(d). The choice between buyback and replacement belongs to the consumer, not the manufacturer. Cash-and-keep is a negotiated alternative where the consumer retains the vehicle. The buyback math is governed by the statutory mileage offset formula in § 1793.2(d)(2)(C) — (price × pre-defect miles) ÷ 120,000.
Buyback (Repurchase)
The manufacturer refunds the purchase price, sales tax, registration, finance charges, collateral charges, and incidental damages, less a statutory mileage offset. Civil Code § 1793.2(d)(2)(B). Best for consumers who want to exit the brand entirely or whose vehicle has fleet-wide pattern defects likely to recur.
Replacement Vehicle
The manufacturer provides a substantially identical new vehicle, paying registration, taxes, and transfer fees. § 1793.2(d)(2)(A). No mileage offset applies — the consumer drove the defective vehicle for free. Best for consumers who liked the model and want the same vehicle without the defect.
Cash-and-Keep Settlement
Negotiated lump-sum payment to the consumer in exchange for retaining the vehicle and releasing the warranty claim. Typically 10–30% of purchase price. No title brand. Best when defect is documented but no longer significantly impairing daily use.
Mileage Offset Calculation
The statutory formula in § 1793.2(d)(2)(C): (actual purchase price × miles before first repair attempt) ÷ 120,000. The denominator is fixed by statute. The numerator — first repair attempt mileage — is the most disputed number in lemon law settlements.
Civil Penalty (§ 1794(c))
Up to 2× actual damages for willful manufacturer violations. The single largest financial multiplier in California Lemon Law. Can effectively triple total recovery in egregious cases. Arbitration cannot award the civil penalty — only civil litigation can.
Attorney Fee Shifting (§ 1794(d))
The manufacturer pays the prevailing consumer’s reasonable attorney’s fees and costs, separately from the consumer’s recovery. This is why California lemon law representation costs the consumer nothing and why every reputable firm works on contingency.
How the Remedies Compare
| Remedy | You receive | You give up | Mileage offset? |
|---|---|---|---|
| Buyback | Cash equivalent of purchase + collateral charges − offset | The vehicle | Yes |
| Replacement | Substantially identical new vehicle | The vehicle | No |
| Cash-and-Keep | Lump sum | Nothing — keep the vehicle | Built into amount |
All three are typically supplemented by the civil penalty (when willful) and the attorney-fee award (paid separately by manufacturer).
Free California Lemon Law Case Review
McMillan Law Group models all three remedy outcomes for your specific vehicle. No fee unless we win.