Tuesday, November 11, 2014

One for the Right Side of "Arising From"

Old Republic Constr. Program Grp. v. Boccardo Law Firm, No. H037989 (D6 Oct. 21, 2014)

In a very thorough opinion, the court here gets the point that the Lunada court missed a few weeks ago. In determining whether the “arising from” prong of the anti-SLAPP analysis has been satisfied, the court should look to what acts the plaintiff contends constitute the allegedly wrongful or injurious conduct. (As opposed to other acts that, while having a causal significance to the story of the case, are not themselves the conduct that forms the basis of the claims.) If the defendant has engaged in protected conduct, but the plaintiff’s case does not actually arise from that conduct, the standard has not been met.


Thus, when the defendant enters a stipulation to put client funds into a trust account but plaintiff’s claim is that defendant wrongfully withdrew those funds, the case arises from the withdrawal, not the stipulation.  And because there is nothing communicative or public-interest-related about taking money out of a bank account, protected activity is not the basis of the claim. So the anti-SLAPP statute does not apply.


Affirmed.

Monday, November 10, 2014

No Third Bites at the Apple

Nixon Peabody v. Superior Court, No B256873 (D2d4 Oct. 17, 2014)

Plaintiff voluntarily dismissed its case in LA Superior and a related case in the C.D. Cal, which lead to the involuntary dismissal with prejudice of a third, related, federal case under the “two dismissal” rule. See Fed. R. Civ. P. 41 (a)(1)(B) (second dismissal is counted as on the merits if plaintiff has previously dismissed a prior case
“based on or including the same claim” ). Plaintiff then moved under Code of Civil Procedure § 473(d) to revive the LA Superior Court case, arguing that because its attorney had not informed it of the consequences of the dismissal, it should be relieved from default. The trial court said ok, but the court of appeal says no dice. Section 473(d) might permit relief when an attorney dismisses a client’s case without authorization, but it doesn’t apply when the attorney just fails to explain the consequences of a dismissal.

Writ granted.

Saturday, November 8, 2014

The Decider Decides

Network Capital Funding Corp. v. Papke, No. G049172 (D4d3 Oct. 9, 2014)

The court rules that an arbitration agreement between a company and one of its employees did not clearly leave it up to the arbitrator to decide whether class arbitration would be permissible. The issue was thus a question of substantive arbitrability for the court to decide. Moreover, the trial court did not err in deciding that the agreement did not, in fact, permit class arbitration. 


Affirmed.

**Note: The Supreme Court granted review on January 14, 2015, likely to resolve the split of authority on who decides the issue of the permissibility of class-wide arbitration that was addressed in Sandquist, in which review had been granted two months prior.

Friday, November 7, 2014

Cop Union Is a Private AG Too

Indio Police Command Unit Assoc. v. City of Indio, No. G050051 (D4d3 Oct. 9, 2014)

The court here upholds an attorneys’ fee award under the private attorney general doctrine. See Cal. Code Civ. Proc. § 1021.5. Plaintiffs—a police officers’ union—sued to enforce a statutory collective bargaining right. The trial court did not abuse its discretion in finding that that right was an important right affecting the public interest, which is the factual predicate to awarding fees under the doctrine. Similarly, the court did not err in finding that the other two elements of the doctrine—that the litigation convey a significant benefit on the general public or a large class of persons, and that there are financial burdens that disincentivize private enforcement—were satisfied.


Affirmed.

Runaway anti-SLAPP Decision Eats Declaratory Relief

Lunada Biomedical v. Nunez, No. B243205 (D2d5 Oct. 9, 2014)

This opinion says that when a claim seeking a declaration of non-liability under the CLRA is met with an anti-SLAPP motion, the declaratory relief cause of action “arises from” the defendants’ CLRA notice letter. Under the test it states, a declaratory relief claim satisfies the first prong of the anti-SLAPP analysis so long as a communication between the parties is needed to show a live controversy. Taken at face value, that would mean that any declaratory relief claim seeking a declaration of non-liability satisfies the first step of the anti-SLAPP analysis.  That can’t be the law.


Guilty, Guilty, Guilty!

CB Richard Ellis v. Tera Nova Consultants, No. G049803 (D4d3 Oct. 7, 2014)

During an effort put a defunct LLC’s members on the hook for its debts, the trial court let the jury see an arbitral ruling—complete with reasoning and factual findings—against the LLC that was the basis of those debts. That was error in that it potentially suggested that the defendants—nonparties in the arbitration—might be bound by the award. The ruling was also hearsay. The court, however, finds the mistake harmless. 


There’s also a jury misconduct issue. Two jurors submitted very brief declarations under Evidence Code § 1150 that another juror had said he knew the defendants and that they were “guilty, guilty, guilty.” That juror, however, submitted a detailed declaration saying he did nothing of the sort, and the court finds that it was not an abuse of discretion for the trial court to rely on the detailed declaration to deny a new trial motion. That seems right. But as I’ve said before, our courts really need to get out of this business altogether.


Affirmed.

Saturday, November 1, 2014

The ESI Dream of the '90s Is Alive in State Court

Vasquez v. Cal. Sch. of Culinary Arts, No. B250600 (D2d2 Sept. 26, 2014)

In responding to a business records subpoena for student loan files, Sallie Mae jerked around some plaintiff lawyers and was cagey about the cost and burden of compliance. After Sallie Mae
’s motion to quash was denied, the trial court awarded about $20k in sanctions because its resistance was not substantially justified.  In an opinion that addresses Code of Civil Procedure § 1985.8—rarely cited in any opinion—the court affirms.

The court first notes that the fact that a subpoena seeks ESI from a third party does not automatically make it unduly burdensome.  (Because it’s not, like, 1990!)  It also rejects Sallie Mae’s argument that “documents” didn’t exist because the information was contained in an electronic database and producing what plaintiffs wanted would entail the creation of “new” documents. That the court's reasoning is based on a 2006 federal district court case—there is no California authority on point—is itself telling on the discouraging state of the state of the art on ESI discovery law in California state court.
 

So the rule is that if you want database information from a third party, you can get it, so long as it is maintained in a way that, even with some work, it can be extracted from the database.  You do, however, have to pay the costs of extraction.  On the other hand, the third party is obliged to provide a reasonable estimate of the costs of compilation. And if the third refuses to do so and acts unreasonably, it will subject to sanctions for a lack of substantial justification.
 

Affirmed.

Thursday, October 30, 2014

Clearing the Decks.

So regular readers (should you exist) might have noticed that my posting frequency has gone craptastic over the last couple weeks.  That’s what expedited cases do to a guy. Maybe more about that later. 
 

I’ve fallen rather behind. In an effort to remain comprehensive—I believe that I’ve hit every published case of procedural significance from the get-go—I'm going to have to run through things a little shorter than ordinary. Over the next couple posts I am going to give be more summary capsules than either the general write ups or the occasional deeper analysis I’ve tried to provide. 

And I Get Upset when My Broadband Is Slow ....

Holguin v. Dish Network, No. D059983 (D4d1 Sept. 22, 2014)

A technician drilled through a sewer pipe while installing satellite television in plaintiffs’ home. He didn’t realize it. By the time the mistake was uncovered more than a year later, plaintiffs’ house has become a mold mine. Defendants (various AT&T-owned companies) agreed to pay for the remediation. But that didn’t go very well, and the matter winds up in litigation. A jury awarded plaintiffs $109,000. The court followed by awarding $180,000 in attorneys’ fees,
—about a third of what plaintiffs’ asked for. Defendants appeal on three somewhat related issues, plus in the court’s award of legal fees. Plaintiffs cross-appeal on the amount of the fee.

Defendants first say that the trial court erroneously instructed the jury on plaintiffs’ contract claims. The evidence showed that there were a series of different form agreements between the plaintiffs and the various defendant entities, signed by plaintiffs at various stages of the installation process. The instructions, however, all referred to “contract,” in the singular. The court here rejects the argument. First, defendants didn’t propose any instruction that used the plural, so the argument was forfeited. And even if it weren’t, the evidence showed that each of the agreements was part of single transaction—the plaintiffs’ signing up telecommunications services. The agreements were replete with cross-references. Under the circumstances, there was no error in treating the various instruments as a series of contracts that “are to be taken together” under Civil Code § 1642, and thus effectively treated as a single contract.


Second, defendants appeal the court’s instruction that the contracts contained an implied term requiring Defendants to properly install the equipment they were providing. They argue that because the contract didn’t contain any such term, it was error for the trial court to tell the jury to imply it. But that argument runs into the law. Every contract includes an implied duty to perform with reasonable care. If you contract to do X, and you do X negligently, you have breached the contract.


Third, defendants appeal the superior court's denials of JNOV and new trial motions that raised the above points as well as the insufficiency of the evidence. The contract points fail for the same reason as above. And as to the adequacy of the evidence, defendants failed to carry their burden on appeal of showing that there was no substantial evidence in favor of the verdict.


Finally, defendants appeal, and Plaintiffs cross-appeal, on the attorneys’ fee award. Defendants first claim that fees aren’t awardable under Civil Code § 1717 because the jury verdict appeared to award damages on negligence, not contract claims.  The court first clarifies that the standard of review is that applicable to determining the prevailing party (abuse of discretion) as opposed to the standard that applies to a determination of the legal basis of an award (de novo). Deciding whether the fee award sufficiently arose from the contract, as opposed to tort, claims was a determination of prevailing party (and claim) status. On the merits, the trial court did not abuse its discretion.  Although the verdict form did not specifically award contract damages, it found that the four elements of breach of contract had been proven and the part of the special verdict that calculated damages was separate from the individual counts on which the jury was polled.


As to the amount of fees, when it calculated the lodestar, the trial court did not abuse its discretion in declining to include about 150 hours of duplicative work a replacement attorney had to do when their first lawyer fell ill. The court’s authority to award reasonable fees permitted it to disallow this time.  Nor did the court err in apportioning fees between contract and tort claims—most of which were nonsuited.  The court employed a reasonable methodology to accomplish the apportionment so it did not abuse its discretion.  Finally, the trial court also did not abuse its discretion in declining to apply an enhancement.  The lodestar itself was a reasonable fee.  Particularly when compared to what the attorneys would obtain under their retainer agreement had there been no § 1717 provision—less than $40 grand—the un-enhanced $180,000 awarded by the court was within the realm of reason.


Affirmed.

Friday, October 17, 2014

A Pleasant Disposition

Ducoing Mortgage v. Superior Court, No. G050457 (D4d3, as amended Feb. 10, 2015*)

Two related company plaintiffs and sued their insurance broker for failing to procure the right policy but got nonsuited at trial. The court awarded defendant about $50k in costs. In a prior appeal, the court affirmed dismissal as to one plaintiff for a somewhat technical reason, but “in all other respects” reversed and remanded for further proceedings.


After remand, the defendant began efforts to collect on the cost judgment against the affirmed plaintiff. In judgment debtor proceedings related to the collection, the trial court held that the costs judgment remained enforceable versus the losing plaintiff, who took a writ.


In reaching the merits, the court makes a number of comments about the nature of an appellate court’s disposition in California. Under Code of Civil Procedure § 43, an appellate court can “affirm, reverse, or modify any judgment or order appealed from, and may direct the proper judgment or order to be entered, or direct a new trial or further proceedings to be had.” This usually occurs in a short paragraph at the end of an opinion. Although it need not be exceedingly detailed, a “disposition is not intended to be a riddle, and the directions in the dispositional language, as conveyed by the remittitur, are to be followed by the trial court on remand.” If a party is confused by the disposition, its proper recourse is a petition for rehearing.


Looking to the prior disposition, the court here holds that its disposition reversing the trial court’s ruling “in all other respects” save the technical reason for bouncing the one plaintiff, in effect, vacated of the costs award too. The court further agrees with the petitioner that it would be “patently unfair” to stick it with a full costs award, given that the defendant still faced full liability on remand from the other plaintiff. Finally, the court notes that § 1032 affords a trial court the discretion to apportion costs. When, like here, two closely affiliated plaintiffs are jointly represented, if one loses but the other potentially prevails, a defendant should only be permitted to recover the marginal costs associated with the joinder of the non-prevailing plaintiff.


Writ granted.


**The court modified its opinion on rehearing to note that a petition for rehearing brought to correct ostensible fact mistakes was brought too late.

Thursday, October 16, 2014

Outrageous Misconduct

Pope v. Babick, No. G049629 (D4d3 Sept. 18, 2014)

The trial court in this car accident case granted a motion in limine. It ordered that unless defendants could establish foundation outside the jury’s presence, defendants could not elicit opinion testimony on causation issues from the CHP officers who responded to the scene of the accident. But defense counsel asked anyway. Before plaintiff could get an objection out, the officer ascribed fault to a party who had previously settled, not the current defendant. Plaintiff’s objected and the court struck the testimony. The cat, however, was out of the bag; the bell rung; Pandora’s box opened; the genie out of the bottle. Elvis had left building. But, said the trial judge, not enough to get a mistrial. A $500 sanction and a reasonably harsh curative instruction avoided any prejudice to the plaintiff. Plaintiff lost the trial and reiterated the misconduct issue in a new trial motion. Plaintiff appealed.


After disposing of the plaintiff’s appeal on lack of substantial evidence by predictably affirming based on the standard of review, the court of appeal addressed the misconduct claim. It admonishes defendant’s attorney (by name) for “outrageous misconduct.” But it too declines to upset the verdict based on the deferential standard of review that applies to denied mistrials. The trial court here provided a thorough explanation of its reasons to limit its sanctions to a monetary penalty and jury instruction—which were quite helpful, although not required. The court was convinced that the trial court’s actions were within the valid scope of its discretion. Similarly so on the new trial motion, which is also subject to deferential review.


Thus, after reiterating that it “strongly disapprove[s] of [the attorney’s] behavior” and that “[i]f it were up to us, he would have been sanctioned far more than $500” the court nonetheless finds that the trial court did not abuse its discretion. The court further notes that “[b]y stating our position in a published opinion, we believe we have satisfied our obligation to take appropriate corrective action as required by Canon 3D(2) of the California Code of Judicial Ethics.” And for good measure, it holds that “[i]n the interests of justice, each party is to bear its own costs on appeal.”


Affirmed.

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After a two-year hiatus,  111 North Hill Street  has decided to decamp for Substack. Thank you for your readership over the last twelve year...