Thursday, October 29, 2015

If There Was Never a Real Plaintiff, No Discovery to Find a New One.

CVS Pharmacy, Inc. v. Superior Court, No. C077622 (D3 Oct. 15, 2015)

This case addresses if and when it is appropriate to permit pre-certification discovery to locate absent class members in a so-called “headless” class action. That is, a case where the court has determined that the original named plaintiff lacks standing the pursue the case on her own behalf. 

Wednesday, October 28, 2015

Death Knell Permits Appeal of Denial of PAGA Representaive Status

Miranda v. Anderson Enters., No. A140328 (D1d5 Oct. 15, 2015)

Since the Supreme Court’s Iskanian decision permitted claims under the Labor Code Private Attorney General Act to skirt the class action waiver arbitration clauses that are otherwise decimating employment class action practice, PAGA has been at the forefront of employment litigation in California. In this case, the trial court, in a pre-Iskanian order, held that Plaintiff’s representative PAGA claims were subject to a class action waiver in her employment contract. There’s little question that the order won’t hold up under Iskanian. But can it be raised in an immediate interlocutory appeal?

Under the “death knell” doctrine, some orders denying class treatment of claims are immediately appealable, notwithstanding the fact that plaintiff could still pursue her own claims on an individual basis. In many cases, denying class treatment transforms the incentive structure for a case in ways that make it highly unlikely if not impossible to pursue individual claims to judgment. If that happens, a denial of class cert would effectively be shielded from review. Thus, since denying cert will practically terminate the whole case, courts often permit a direct appeal of that decision, notwithstanding the absence of a final judgment.

It’s an open question as to whether the death knell doctrine applies denial of representative treatment for PAGA claims. But the court here holds it does. There are various procedural differences between PAGA representative actions and class actions. Indeed, some of those distinctions—in particular, that the plaintiff is acting in a quasi qui tam capacity on the State
s behalf—are the basis of Iskanian. But there are also similarities. And when it comes to the death knell doctrine, the similarities matter more than the differences. In particular, the denial of representative status for PAGA claims alters the incentives to pursue small cases in more or less same way as denial of class cert does. So just like a decision denying cert or sending a case to non-class arbitration, a denial of the right to proceed with PAGA claims on a representative basis effectively rings the death knell on those claims too.


Tuesday, October 27, 2015

Everybody Wins!

Sharif v. Mehusa, Inc., No. B255578 (D2d5 Oct. 14, 2015)

An employee brought two different kinds of claims against her employer: claims under the Equal Pay Act, and wage-and-hour claims under the Labor Code. At a jury trial, she prevailed on the former but not the latter.  Both sets of statutes specifically award costs and fees to prevailing parties. Plaintiff contended that since she won a net monetary victory, she was the overall prevailing party and thus only her fees were recoverable. But the trial court disagreed and the court of appeal affirms. The claims weren’t factually related. And since both statutes shifted fees in favor of the prevailing party, both parties were entitled to recover their costs and fees on the parts of the case they prevailed on. When there statute-specific fee provisions, Code of Civil Procedure § 1032’s more general definitions of prevailing party—which look to who got a net monetary recovery—don’t apply.


Friday, October 23, 2015

No Second Shots to Plead Around CCP 425.16(b).

Mobile Med. Servs. for Physicians & Advance Practice Nurses, Inc. v. Rajaram, No. G050111 (D4d3 Oct. 13, 2015)

Plaintiff sued on a number of theories, all based on Defendant
s allegedly making some untrue or defamatory statements in the course of an investigation conducted by the California Nursing Board. Unsurprisingly, that drew a successful anti-SLAPP motion. But the trial court granted the motion with leave to amend, permitting plaintiff to re-allege a breach of contract action whose facts were disaggregated from the allegations about the statements to the Nursing Board. Plaintiff did so amend, withdrawing the Nursing Board statements, and the trial court denied a subsequent anti-SLAPP motion, finding that the amended complaint did not allege claims arising from protected activity.

That was a mistake. Long-settled anti-SLAPP precedent holds that once the trial court finds that a claim arises from protected activity, Plaintiff’s can’t get leave to plead around the protected activity to avoid an anti-SLAPP dismissal. If Plaintiff had a viable claim that didn’t implicate Defendant
’s free speech rights, it was incumbent on it to plead the claim that way in the first instance.  


Thursday, October 22, 2015

The Gravamen of Litigation Malpractice

Sprengel v. Zbylut, No. B256761 (D2d7 Oct. 13, 2015)

The anti-SLAPP statute can be tricky when it comes to cases involving litigation malpractice. To the extent that the claims touch on stuff an attorney does in court they at least superficially can seem to satisfy the first, “arising from” element of the two-pronged test. But on a less literal level, that doesn’t make any sense. A malpractice claim that a client brings against his own attorney has essentially nothing to with chilling anyone’s First Amendment rights, even if the attorney’s in-court or litigation related statements are somehow implicated in the malpractice.

Tuesday, October 20, 2015

Just How Interesting and to Whom?

Bikkina v. Mahadevan, No. A143031 (D1d4 Oct. 9, 2015)

Two of the four categories of activity protected under the anti-SLAPP statute require the lawsuit to arise from speech activities
in connection with an issue of public interest.Cal. Code Civ. Proc. § 425.16(e)(3) or (4). Sussing that out can be a tough job for the judiciary, particularly when it is an invitation to weigh in on the seriousness of intra-academic disputes. Just how public or interesting does an issue have to be to meet the test? 

Here, the Court finds that one academics relentless and seemingly inaccurate attacks on another’s work doesn’t make the public issue grade. It then goes on to hold that it doesn’t matter anyway, because the plaintiff came forward with enough evidence to defeat the motion. Given the alternative holding, it seems—at least a littlelike the court is potentially letting the merits of the dispute color the public interest inquiry. That is, the analysis intimates that the inappropriate and unmeritorious—and thus potentially defamatorynature of accuser’s accusations precludes them from being publicly interesting in the first place. 

Friday, October 16, 2015

Due Process and All That

Behm v. Clear View Techs., No. H040032 (D6, as modified Oct. 16, 2015)

A trial court entered terminating sanctions against Defendant after it failed to comply with discovery orders. The complaint prayed only for damages
in excess of $200,000. But Plaintiff moved for and obtained a default judgment of $1.26 million, including $970k in punitives and compensatory damages that were more than $100k over the prayer. Defendant moved for mandatory relief from default under Code of Civil Procedure § 473(b) on the grounds that its attorney’s mistake was the cause of the default. The court denied the § 473(b) motion, but vacated the default judgment on the grounds that it shouldn’t have awarded more than what was demanded in the complaint. It invited plaintiff to file a new default judgment motion limited to $200k in damages. Both parties appealed.

Wednesday, October 14, 2015

If They Wanted to Find the Facts, They Would Be Trial Judges

Tellez v. Rich Voss Trucking, No. H04375 (D6 Sept. 30, 2015)

The trial court granted Defendant’s motion to strike class allegations in a one-sentence tentative. It then refused to expound upon its reasoning during or after argument because Plaintiff didn’t follow a local rule requiring him to call the clerk and give a heads up regarding his intent to argue against the tentative. So class cert effectively got denied and the court of appeal doesn’t really know why.

Under the circumstances of this case, that merits a reversal and remand for a clearer explanation. Class cert is very fact-intensive and the trial court is endowed with significant discretion in deciding the issue. Except in situations—not present here—where the record provides a clear explanation of a summary ruling, the trial court needs to explain why class treatment isn’t merited. Since the court of appeal is disinclined to do that work in the first instance, this case gets sent back for a better explanation.


After Eighteen Years, a Whimper

In re Tobacco Cases II, No. D065165 (D4d1 Sept. 28, 2015)

This case about Philip Morris’s allegedly deceptive marketing of Marlboro Light cigarettes has been kicking around the state courts since 1997! After a bench trial, the trial court found that Defendants violated the Unfair Competition Law, but nonetheless awarded no remedy. It determined that restitution was inappropriate and any injunctive relief had been long ago mooted by federal legislation specifically addressing the labeling practices at issue in the case.

Affirming on the merits, the court of appeal also addresses two procedural issues: (1) Was Defendant the prevailing party under Code of Civil Procedure § 1032, entitling it to recover its costs? And (2) did the trial court properly refuse to award Plaintiffs costs and fees under § 2033.420, as a sanction for Defendants’ unjustified denial of a request for admission.

The first question is an easy one. Section 1032 specifically says that the defendant is the prevailing party when plaintiff takes no relief. That’s the case even if there’s a finding that defendant violated the law but no remedy is afforded.

As to the RFA, the trial court denied Plaintiffs’ fee request because they never provided an accounting of the fees attributable to the unjustified denial of the RFA. Indeed, their request seems mostly to have been an afterthought to offset the $700k in costs that the court awarded to Defendant as prevailing party. Not only was the trial court within its discretion in denying the request in the absence of an accounting, but by failing to provide the information to justify an award, Plaintiffs waived their right to appeal the denial.


Tuesday, October 13, 2015

Don't Mess with . . . California Subcontractors

Vita Planning & Landscape Architecture, Inc., v. HKS Architects, Inc., No. A141010 (D1d5 Sept. 25, 2015)

The trial court in this construction dispute dismissed under Code of Civil Procedure § 410.30, finding that Texas courts were a more appropriate forum because the contract between the parties contained Texas forum selection and choice-of-law clauses. But that gets sideways with § 410.42, which prevents out-of-state contractors from requiring California subcontractors to litigate certain contract disputes in the contractor’s home state when the work is done in California. Defendant contended, and the trial court agreed, that the relationship at issue here—between an general architecture firm and landscape architect—was not the kind of contractor/subcontractor relationship addressed by § 410.42. The Legislature, however, intended to broadly protect in-state subcontractors. So the fact that the sub was providing design services, as opposed to more typical construction stuff, didn’t make a difference. The Texas forum clause thus was unenforceable under § 410.42.


Sunday, October 11, 2015

Zero-Dollar § 998 Offer Found Reasonable

Melendrez v. Ameron Int’l. Corp., No B256928 (D2d Sept. 17, 2015)

Plaintiff lost at summary judgment in this asbestos case because his exposure was in the workplace, which meant his exclusive remedy was workers’ comp. While its SJ motion was pending, Defendant made a rather aggressive offer of judgment under Code of Civil Procedure § 998 offer, proposing a dismissal in exchange for a mutual waiver of costs and fees. Because plaintiff didn't beat hte offer, the court permitted the shifting of costs, including significant expert witness fees. Plaintiff moved to tax, arguing that the lowball § 998 offer was in bad faith and that certain expert expenses were not sufficiently related to the experts testimony to be recoverable. The trial court disagreed.

The court of appeal affirms. A plaintiff’s failure to beat a defendant’s § 998 offer merits a presumption that the offer was reasonable. To rebut the presumption, Plaintiff bears the burden of showing unreasonableness. While a court can consider plaintiff’s in assessing reasonableness, it’s by far the only thing that matters. Courts can also consider the amount of costs to be shifted and the plaintiff
likelihood of prevailing. So when a defendant has a strong defense—like Defendant’s workers’ comp defense here—it can permissibly make a low offer. That’s particularly true here, where discovery was largely complete and the SJ motion pending by the time Defendant made its offer. So Defendant could make a good-faith informed assessment of the strength of Plaintiff’s case and the value of its claims.

There’s also an issue about allocation of expert fees. Defendant’s experts inspected Plaintiffs home
to which he had brought home various asbestos-containing goods from work for use in home improvement projectsfor contamination. When the found asbestos, they also did significant remediation work to remove it. Work done to inspect is recoverable as part of the experts’ work in preparing to testify in the case. But work done to remove contamination is not. Here, the court finds that the trial court made a permissible allocation, excluding recovery for various work that was solely for remediation purposes. To the extent the trial court permitted recovery of some expenses whose purpose wasn’t completely clear, it was the court’s prerogative to make factual findings regarding whether any work was necessity to the expert’s testimony. So long as substantial evidence in support them, which it does, those findings don’t get disturbed on appeal.


Wednesday, October 7, 2015

In Other News . . . .

If you haven’t yet had your fill of California procedure—and really, who could ever have too much California procedure—I have an article on motions for new trial (and the Maroney case in particular) in this month's Los Angeles Lawyer. You could even take the quiz and get some easy CLE!

Monday, October 5, 2015

Just More Chances to Lose

San Diegans for Open Gov’t v. Har Const. Co., No. D066514 (D4d1 Sept. 17, 2015).

A good-government group brought this case to cancel a construction contract under Government Code § 1090 as the product of a corrupt bargain between a San Diego-area school district and a contractor. More than a year into the litigation, Contractor filed an anti-SLAPP motion, which the trial court denied because Plaintiff established a likelihood of prevailing on the merits.