Brooks v. Amerihome Mortgage Co., No. B298132 (D2d6 Apr. 8, 2020)
As is required by the Labor Code Private Attorney General Act, Plaintiff here gave notice to the Labor and Workforce Development Agency that he intended to bring a PAGA claim against his Employer if the LWDA declined to. During the waiting period for LWDA to act, Employer served an arbitration demand. Once the period ran, Plaintiff sued. Employer moved to stay the case and Plaintiff sought a preliminary injunction preventing the arbitration. The trial court denied the stay and granted the injunction.
On the merits, this one is pretty clear. PAGA claims—which are brought in a semi-qui tam posture on behalf of the state—aren’t arbitrable. Plaintiff here brought only a claim under PAGA. Therefore, his claim couldn’t be sent to an arbitration. Employer argued that the complaint also sought individual remedies under Labor Code for lost wages, and that such claims are arbitrable. But that’s not what the complaint said.
So Plaintiff showed a likelihood of success. And being forced to arbitrate a non-arbitrable claim is the kind of irreparable injury that would permit an injunction.
Affirmed.
This all seems pretty cut and dry. But what if Plaintiff had lost in the trial court? Pretend, for the moment that these aren’t PAGA claims. The trial court’s grant of a stay pending arbitration is not an appealable order. But Plaintiff sought an injunction, and the denial of an injunction generally is. Code Civ. Proc. § 904.1(a)(6).
So could Plaintiff have appealed that loss? Probably not. Notwithstanding § 904.1(a)(6), California courts have held that “an order refusing to enjoin arbitration is tantamount to an order compelling arbitration,” and thus not appealable under § 1294, the statue that limits appealability to denials of motions to compel arbitration. See Melchor Inv. Co. v. Rolm Sys., 3 Cal. App. 4th 587, 592 (1992).
Wednesday, April 29, 2020
Tuesday, April 28, 2020
What's in a Name?
McHenry v. Asylum Entm't Del., LLC. No. B292457 (D2d2 Mar. 12, 2020)
If you, like I, spend a lot of time reading random opinions, you start to rough sense of what a case might be about just from the caption. Most of the time. But clearly nobody would guess that McHenry v. Asylum Entertainment Delaware, LLC is an admiralty case.
If you, like I, spend a lot of time reading random opinions, you start to rough sense of what a case might be about just from the caption. Most of the time. But clearly nobody would guess that McHenry v. Asylum Entertainment Delaware, LLC is an admiralty case.
Monday, April 27, 2020
Selective Lawlessness Is Still Lawlessness
Siry Inv., L.P. v. Farkhondhepour, No. B277750 (D2d2, as modified Mar. 23, 2020)
The trial court in this long-running partnership dispute entered a $7 million default judgment as a terminating sanction for discovery misconduct. Defendants raise three procedural issues on appeal.
First, the terminating sanctions were levied for Defendants’ non-compliance with two sets of discovery. Defendants failed to comply with these requests after being ordered by the court over and over again to respond without objections. They engaged in a campaign of extensive obstruction. Even after being ordered to produce, they continued to serve junk responses consisting only of hundreds of pages bogus objections. They repeatedly sought “reconsideration” and “clarification” of the court’s unambiguous orders. Their effort included an ex parte application where they failed to give notice to Plaintiff and then misrepresented the record at a hearing Plaintiff did not attend.
Defendants argue, however, that terminating sanctions aren’t appropriate because the discovery they stiffed Plaintiff on didn’t encompass every issue in the case. That, however, is not the law. In a noble effort to reconcile some not-super-consistent case law, the opinion starts off a very comprehensive synthesis of the standards applicable to discovery sanctions. It’s a good resource for anyone moving for them. Suffice it to say, the Court of Appeal finds that the applicable standards were squarely met here.
Moving on to the specific issue, discovery misconduct needs not go to every single issue to be tried in the case to merit terminating sanctions. As the Court explains, “selective lawlessness is still lawlessness.” Indeed, were Defendants correct about the rule, parties could shield themselves from the consequences of even severe discovery misconduct by being cooperative in discrete issues in a case. It would encourage the service of overbroad discovery to insure that the whole map would be covered by any non-compliance. And it would be contrary to the established rule that a propounding party does not need to establish prejudice to merit terminating sanctions—a rule that exists because prejudice could likely be proven only by the information that the intransigent party is refusing to produce.
The second issue is related, somewhat. One of the Defendants got indicted on a seemingly unrelated case. At some point after the trial court ordered him to cough up documents and answer interrogatories but before he was defaulted, he objected that the court’s orders compelling discovery violated his Fifth Amendment privilege. The trial court overruled the objection.
A civil litigant raising a Fifth Amendment privilege bears the burden of showing that discovery entails a disclosure of communications that are (1) compelled; (2) testimonial; and (3) incriminating. To show the third element, the objector needs to make a specific objection that explains how answering the discovery would furnish a link in the chain of evidence needed to prosecute him for a crime.
Defendant here didn’t meet his burden. First, his objection was too generic. It offered no explanation at all why the compelled disclosure would be incriminating. Second, along related lines, he thus did not bear his burden of showing that an injurious disclosure could result. Facially, the indicted crimes were unrelated to the issues on which discovery was sought. If there was some link, Defendant bore the burden of drawing it at a reasonable level of specificity.
Finally, Defendant didn’t raise his objection until long after the trial court ordered him to produce the discovery and he failed to do so. A privilege that was not timely raised does not excuse Defendant’s refusal to abide by court orders.
The last issue deals with damages. The damages awarded after the default prove up included (1) $4 million in punitive damages; (2) almost $3 million in trebled damages under Penal Code § 496, which penalizes the receipt of stolen property; and (3) an award of attorneys’ fees under the same statute.
Defendants moved for new trial, arguing that awarding the § 496 damages and fees was contrary to law, that the punitives were excessive, and that Plaintiffs were required to elect between punitive and trebled damages. The trial court agreed on everything but the § 496 issue and granted the motion to that extent.
A gating issue on the appeal—and the principal procedural issue—is whether Defendants had standing to move for a new trial, given that they were in default. As the Court here notes, a defendant can appeal a default judgment, albeit only on certain grounds not admitted by the default. One of these is that a damages award is contrary to law. And since an appeal is authorized, there’s no good reason why the defaulted defendant can’t raise these legal errors in a new trial motion. That’s generally consistent with the new trial statute, Code of Civil Procedure § 657, which permits a “party aggrieved” to seek a new trial based on an error of law.
On the merits of the damages issue, the trial court shouldn’t have awarded damages or fees under § 496. That statute deals with trafficking in stolen goods by persons other than the thief. The facts here involved fraudulent diversion of partnership revenue by the defendant. If § 496 applied to that kind of conduct, it would effectively permit a treble damages remedy for all financial fraud, which is not what the Legislature intended. Nor was there any other basis to award attorney’s fees to Plaintiff.
Reversed in part.
The trial court in this long-running partnership dispute entered a $7 million default judgment as a terminating sanction for discovery misconduct. Defendants raise three procedural issues on appeal.
First, the terminating sanctions were levied for Defendants’ non-compliance with two sets of discovery. Defendants failed to comply with these requests after being ordered by the court over and over again to respond without objections. They engaged in a campaign of extensive obstruction. Even after being ordered to produce, they continued to serve junk responses consisting only of hundreds of pages bogus objections. They repeatedly sought “reconsideration” and “clarification” of the court’s unambiguous orders. Their effort included an ex parte application where they failed to give notice to Plaintiff and then misrepresented the record at a hearing Plaintiff did not attend.
Defendants argue, however, that terminating sanctions aren’t appropriate because the discovery they stiffed Plaintiff on didn’t encompass every issue in the case. That, however, is not the law. In a noble effort to reconcile some not-super-consistent case law, the opinion starts off a very comprehensive synthesis of the standards applicable to discovery sanctions. It’s a good resource for anyone moving for them. Suffice it to say, the Court of Appeal finds that the applicable standards were squarely met here.
Moving on to the specific issue, discovery misconduct needs not go to every single issue to be tried in the case to merit terminating sanctions. As the Court explains, “selective lawlessness is still lawlessness.” Indeed, were Defendants correct about the rule, parties could shield themselves from the consequences of even severe discovery misconduct by being cooperative in discrete issues in a case. It would encourage the service of overbroad discovery to insure that the whole map would be covered by any non-compliance. And it would be contrary to the established rule that a propounding party does not need to establish prejudice to merit terminating sanctions—a rule that exists because prejudice could likely be proven only by the information that the intransigent party is refusing to produce.
The second issue is related, somewhat. One of the Defendants got indicted on a seemingly unrelated case. At some point after the trial court ordered him to cough up documents and answer interrogatories but before he was defaulted, he objected that the court’s orders compelling discovery violated his Fifth Amendment privilege. The trial court overruled the objection.
A civil litigant raising a Fifth Amendment privilege bears the burden of showing that discovery entails a disclosure of communications that are (1) compelled; (2) testimonial; and (3) incriminating. To show the third element, the objector needs to make a specific objection that explains how answering the discovery would furnish a link in the chain of evidence needed to prosecute him for a crime.
Defendant here didn’t meet his burden. First, his objection was too generic. It offered no explanation at all why the compelled disclosure would be incriminating. Second, along related lines, he thus did not bear his burden of showing that an injurious disclosure could result. Facially, the indicted crimes were unrelated to the issues on which discovery was sought. If there was some link, Defendant bore the burden of drawing it at a reasonable level of specificity.
Finally, Defendant didn’t raise his objection until long after the trial court ordered him to produce the discovery and he failed to do so. A privilege that was not timely raised does not excuse Defendant’s refusal to abide by court orders.
The last issue deals with damages. The damages awarded after the default prove up included (1) $4 million in punitive damages; (2) almost $3 million in trebled damages under Penal Code § 496, which penalizes the receipt of stolen property; and (3) an award of attorneys’ fees under the same statute.
Defendants moved for new trial, arguing that awarding the § 496 damages and fees was contrary to law, that the punitives were excessive, and that Plaintiffs were required to elect between punitive and trebled damages. The trial court agreed on everything but the § 496 issue and granted the motion to that extent.
A gating issue on the appeal—and the principal procedural issue—is whether Defendants had standing to move for a new trial, given that they were in default. As the Court here notes, a defendant can appeal a default judgment, albeit only on certain grounds not admitted by the default. One of these is that a damages award is contrary to law. And since an appeal is authorized, there’s no good reason why the defaulted defendant can’t raise these legal errors in a new trial motion. That’s generally consistent with the new trial statute, Code of Civil Procedure § 657, which permits a “party aggrieved” to seek a new trial based on an error of law.
On the merits of the damages issue, the trial court shouldn’t have awarded damages or fees under § 496. That statute deals with trafficking in stolen goods by persons other than the thief. The facts here involved fraudulent diversion of partnership revenue by the defendant. If § 496 applied to that kind of conduct, it would effectively permit a treble damages remedy for all financial fraud, which is not what the Legislature intended. Nor was there any other basis to award attorney’s fees to Plaintiff.
Reversed in part.
Thursday, April 23, 2020
Facebook III
Facebook, Inc. v. Superior Court, No. A157143 (D1d5 Mar. 6, 2020)
This is on appeal again following remand from the Supreme Court’s decision in Facebook v. Superior Court.
There, the court held that the Stored Communications Act permits a criminal defendant to subpoena fully public Facebook posts on a consent theory. But that didn’t apply to posts disclosed only to “friends,” no matter how numerous. The court remanded to the Court of Appeal for application of this rule, a determination of whether disclosure of only public posts would be sufficient, an analysis of Facebook’s burden objections, and an exploration of the adequacy of alternatives such as ordering the poster to consent or ordering the DA to serve Facebook with a warrant demanding the non-public materials. The Court of Appeal sent the case back to the trial court for more factual development.
After Facebook abandoned its burden objections, the trial court ordered the whole shebang—public and private—produced. It decided that, in the absence of any burden claim, the defendant’s Sixth Amendment rights overrode whatever SCA and privacy interests that the poster (a witness who allegedly has some credibility issues) might have. Facebook took another writ. And the Court of Appeal again grants and reverses.
From the Court of Appeal’s perspective, the trial court (yet again) jumped the gun. It didn’t do what the Supreme Court said, because focused only on the burden on the rights of the defendant. The Court does agree that ordering the DA to serve a search warrant isn’t a viable option. But the trial court nonetheless failed to consider whether other measures short of wholesale ordering Facebook to make the production could still protect defendant’s rights. It should have considered (a) whether a production of the public posts only would be sufficient; and (b) whether obtaining the posts from the witness or a third party to that communication was a feasible option.
Writ granted.
This is on appeal again following remand from the Supreme Court’s decision in Facebook v. Superior Court.
There, the court held that the Stored Communications Act permits a criminal defendant to subpoena fully public Facebook posts on a consent theory. But that didn’t apply to posts disclosed only to “friends,” no matter how numerous. The court remanded to the Court of Appeal for application of this rule, a determination of whether disclosure of only public posts would be sufficient, an analysis of Facebook’s burden objections, and an exploration of the adequacy of alternatives such as ordering the poster to consent or ordering the DA to serve Facebook with a warrant demanding the non-public materials. The Court of Appeal sent the case back to the trial court for more factual development.
After Facebook abandoned its burden objections, the trial court ordered the whole shebang—public and private—produced. It decided that, in the absence of any burden claim, the defendant’s Sixth Amendment rights overrode whatever SCA and privacy interests that the poster (a witness who allegedly has some credibility issues) might have. Facebook took another writ. And the Court of Appeal again grants and reverses.
From the Court of Appeal’s perspective, the trial court (yet again) jumped the gun. It didn’t do what the Supreme Court said, because focused only on the burden on the rights of the defendant. The Court does agree that ordering the DA to serve a search warrant isn’t a viable option. But the trial court nonetheless failed to consider whether other measures short of wholesale ordering Facebook to make the production could still protect defendant’s rights. It should have considered (a) whether a production of the public posts only would be sufficient; and (b) whether obtaining the posts from the witness or a third party to that communication was a feasible option.
Writ granted.
Wednesday, April 22, 2020
California Agrees: Only One Hit on the American Pipe
Montoya v. Ford Motor Co., No. G045752 (D4d3 Mar. 12, 2020)
In 2018’s China Agritech v. Resh, the U.S. Supreme Court held that so-called American Pipe tolling tolls a class member’s statute of limitations only for the time a first filed class action remains pending. An absent plaintiff can’t stack together tolling periods from a bunch of different class actions to achieve an even longer tolling period. So once the first class action is dismissed, class cert denied, or the plaintiff opts out of a certified or settlement class, the plaintiff’s clock restarts without further tolling.
Here, the Court of Appeal adopts the rationale China Agritech as a matter of California state procedural law.
Reversed.
In 2018’s China Agritech v. Resh, the U.S. Supreme Court held that so-called American Pipe tolling tolls a class member’s statute of limitations only for the time a first filed class action remains pending. An absent plaintiff can’t stack together tolling periods from a bunch of different class actions to achieve an even longer tolling period. So once the first class action is dismissed, class cert denied, or the plaintiff opts out of a certified or settlement class, the plaintiff’s clock restarts without further tolling.
Here, the Court of Appeal adopts the rationale China Agritech as a matter of California state procedural law.
Reversed.
Thursday, April 16, 2020
The Logical Limits of an Element Based Anti-SLAPP Analysis
Spencer v. Mowat, No. B295738 (D2d5 Mar. 24, 2020)
Plaintiffs in this case allege that defendants are a gang of local surfers in the PV who have conspired in a campaign of intimidation and violence to prevent outsiders from surfing their break. Two defendants—alleged to have been members of the conspiracy but not to have personally committed any violent acts—brought an anti-SLAPP motion. It was denied.
On appeal, the court makes relatively short shrift of the argument that the claims arise from protected activity. In doing so, it focuses on the various violent acts committed by others in furtherance of the alleged conspiracy, which cases like 7 Stars regard as a proper focus of applying “arising from” to a conspiracy.
Affirmed.
At high level of generality, the analysis here makes some practical sense, for the same reason I thought 7 Stars was not a particularly hard case.
But 7 Stars was decided several months before the Supreme Court’s decision in Wilson. There, the court (in a discrimination case) held that if conduct that makes up any element of a multi-element tort satisfies the arising from test, then the first prong of the anti-SLAPP analysis is satisfied. That is the case, notwithstanding the fact that liability turns on the proof of other elements that are clearly not protected activity. Thus, in Wilson, the fact CNN had a colorable claim that it fired the plaintiff to enforce journalistic ethics against plagiarism was adequate to be “protected activity.” That was the case even though the crux of plaintiff’s claim—that he was fired because of his or her race—is not protected by the First Amendment.
In a conspiracy case, the existence and scope of the agreement is a key element of the claim. So following Wilson, to decide whether a conspiracy claim arises from protected activity, a court would need to look at whether the agreement itself is could be “other conduct in furtherance” under Code of Civil Procedure § 425.16(e)(4), notwithstanding the fact that roughing up Barneys from the Valley is obviously not constitutionally protected.
And in doing that analysis, Wilson says a court needs to credit, to some significant degree, the moving Defendant’s evidence. So what if, in this case, Defendants put in evidence akin to CNN’s evidence in Wilson? Suppose defendants declared that they were an informal community organization concerned with the negative consequence of overuse of certain beaches, which Defendants believed merited a rule that beach access should be constrained to members of the local community? Taken at the same value the court gave the CNN’s evidence in Wilson, wouldn’t the agreement element of the conspiracy claim implicate the defendants’ freedom of association, and thus satisfy § 425.16(e)(4)? Notwithstanding that the overt act element of the claim entails stuff that is clearly outside of the First Amendment?
I've haven’t yet managed to come up with a fully-theorized answer to this that jives with Wilson. But it does illustrate how that there are a lot of unresolved questions left open by the formal element-based framework adopted by the Wilson court.
Plaintiffs in this case allege that defendants are a gang of local surfers in the PV who have conspired in a campaign of intimidation and violence to prevent outsiders from surfing their break. Two defendants—alleged to have been members of the conspiracy but not to have personally committed any violent acts—brought an anti-SLAPP motion. It was denied.
On appeal, the court makes relatively short shrift of the argument that the claims arise from protected activity. In doing so, it focuses on the various violent acts committed by others in furtherance of the alleged conspiracy, which cases like 7 Stars regard as a proper focus of applying “arising from” to a conspiracy.
Affirmed.
At high level of generality, the analysis here makes some practical sense, for the same reason I thought 7 Stars was not a particularly hard case.
But 7 Stars was decided several months before the Supreme Court’s decision in Wilson. There, the court (in a discrimination case) held that if conduct that makes up any element of a multi-element tort satisfies the arising from test, then the first prong of the anti-SLAPP analysis is satisfied. That is the case, notwithstanding the fact that liability turns on the proof of other elements that are clearly not protected activity. Thus, in Wilson, the fact CNN had a colorable claim that it fired the plaintiff to enforce journalistic ethics against plagiarism was adequate to be “protected activity.” That was the case even though the crux of plaintiff’s claim—that he was fired because of his or her race—is not protected by the First Amendment.
In a conspiracy case, the existence and scope of the agreement is a key element of the claim. So following Wilson, to decide whether a conspiracy claim arises from protected activity, a court would need to look at whether the agreement itself is could be “other conduct in furtherance” under Code of Civil Procedure § 425.16(e)(4), notwithstanding the fact that roughing up Barneys from the Valley is obviously not constitutionally protected.
And in doing that analysis, Wilson says a court needs to credit, to some significant degree, the moving Defendant’s evidence. So what if, in this case, Defendants put in evidence akin to CNN’s evidence in Wilson? Suppose defendants declared that they were an informal community organization concerned with the negative consequence of overuse of certain beaches, which Defendants believed merited a rule that beach access should be constrained to members of the local community? Taken at the same value the court gave the CNN’s evidence in Wilson, wouldn’t the agreement element of the conspiracy claim implicate the defendants’ freedom of association, and thus satisfy § 425.16(e)(4)? Notwithstanding that the overt act element of the claim entails stuff that is clearly outside of the First Amendment?
I've haven’t yet managed to come up with a fully-theorized answer to this that jives with Wilson. But it does illustrate how that there are a lot of unresolved questions left open by the formal element-based framework adopted by the Wilson court.
Right of Publicity Case Gets SLAPPed
Pott v. Lazarin, No. H044587 (D6 Mar. 30, 2020)
Plaintiffs’ daughter was sexually assaulted, and afterwards, her assailants distributed photographs of the assault. She committed suicide shortly thereafter. Defendant runs some kind of suicide prevention org> He used the victim’s name and photograph at a press conference in connection with his advocacy and (although this is disputed) some fundraising.
Plaintiffs sued Defendant for violating California’s right of publicity statute, Civil Code § 3344.1, which creates a tort for commercially exploiting the likeness of another. Defendant filed an anti-SLAPP motion, which the trial court denied on the grounds that the conduct was facially illegal under Flatley v. Muoro.
The Flately argument, of course, is wrong. It basically always is. And nobody defends it on appeal.
But there’s also no other basis to affirm. Defendant had been sued for his speech, made in a public forum, on an issue of public interest. (The last point is bolstered by the fact that, with Plaintiffs’ authorization, a documentary had been produced about their daughter.) That satisfies the “arising from protected activity” test under Code of Civil Procedure § 425.16(e)(3).
On the merits, § 3344.1 applies only to commercial speech. (That’s the only reason it’s constitutional.) Here, there’s no question that Defendant’s use wasn’t commercial. It had no connection with the sale of goods or services. It was instead political. That’s the case even if Plaintiffs were right that their daughter’s image and name were used in connection with fundraising for Plaintiff’s advocacy organization.
Reversed.
Plaintiffs’ daughter was sexually assaulted, and afterwards, her assailants distributed photographs of the assault. She committed suicide shortly thereafter. Defendant runs some kind of suicide prevention org> He used the victim’s name and photograph at a press conference in connection with his advocacy and (although this is disputed) some fundraising.
Plaintiffs sued Defendant for violating California’s right of publicity statute, Civil Code § 3344.1, which creates a tort for commercially exploiting the likeness of another. Defendant filed an anti-SLAPP motion, which the trial court denied on the grounds that the conduct was facially illegal under Flatley v. Muoro.
The Flately argument, of course, is wrong. It basically always is. And nobody defends it on appeal.
But there’s also no other basis to affirm. Defendant had been sued for his speech, made in a public forum, on an issue of public interest. (The last point is bolstered by the fact that, with Plaintiffs’ authorization, a documentary had been produced about their daughter.) That satisfies the “arising from protected activity” test under Code of Civil Procedure § 425.16(e)(3).
On the merits, § 3344.1 applies only to commercial speech. (That’s the only reason it’s constitutional.) Here, there’s no question that Defendant’s use wasn’t commercial. It had no connection with the sale of goods or services. It was instead political. That’s the case even if Plaintiffs were right that their daughter’s image and name were used in connection with fundraising for Plaintiff’s advocacy organization.
Reversed.
Wednesday, April 15, 2020
The Transportation Safety Grant Privilege
Ford v. City of L.A., No. B290239 (D2d8 Apr. 1, 2020)
Apparently, there’s a federally codified privilege that prevents both the discovery and admissibility of studies and other work undertaken in connection with a local government’s applying for federal DOT grant funding for transportation safety improvements. See 23 U.S.C. § 409. Sort of an attempting to make remedial measures thing.
Did not know that.
Affirmed.
Apparently, there’s a federally codified privilege that prevents both the discovery and admissibility of studies and other work undertaken in connection with a local government’s applying for federal DOT grant funding for transportation safety improvements. See 23 U.S.C. § 409. Sort of an attempting to make remedial measures thing.
Did not know that.
Affirmed.
Friday, April 10, 2020
A Life in Litigation
Montrose Chem. Corp. of Cal. v. Canadian Univ. Ins. Co., No. S244737 (Cal. Apr. 6, 2020)
So I have this pro bono case that was originally filed in 2002—I was still a 1L—which has been reversed on appeal four times. Once everyone doesn’t need to work out of their basement anymore, hopefully it will finally get tried sometime later this year.
I thought that took the cake, at least for civil cases. (Capital cases and their subsequent habeases are obviously a different animal.) But in this Supreme Court opinion, on a somewhat obscure issue on what exhaustion of primary coverage is required to trigger the obligations of excess insurance carriers, the Court notes that it “previously recounted the basic facts facts underlying this dispute.” It then cites an opinion from 1993!
It’s an insurance dispute. Essentially, a fight over the meaning of words in a contract. And it’s been going on for at 27 years since the first time it was before the Supreme Court! And the remand anticipates “further proceedings!”
Court of appeal reversed.
So I have this pro bono case that was originally filed in 2002—I was still a 1L—which has been reversed on appeal four times. Once everyone doesn’t need to work out of their basement anymore, hopefully it will finally get tried sometime later this year.
I thought that took the cake, at least for civil cases. (Capital cases and their subsequent habeases are obviously a different animal.) But in this Supreme Court opinion, on a somewhat obscure issue on what exhaustion of primary coverage is required to trigger the obligations of excess insurance carriers, the Court notes that it “previously recounted the basic facts facts underlying this dispute.” It then cites an opinion from 1993!
It’s an insurance dispute. Essentially, a fight over the meaning of words in a contract. And it’s been going on for at 27 years since the first time it was before the Supreme Court! And the remand anticipates “further proceedings!”
Court of appeal reversed.
Thursday, April 9, 2020
Mandatory, Not Jurisdictional
Kelly v. House, No. A153735 (D1d1 Apr. 2, 2020)
This is a pretty nasty land dispute over a right of first refusal to buy some farmland. The prevailing Plaintiffs sought attorneys’ fees under various theories, but allegedly filed their fee app a day too late under Rule of Court 3.1702(b), which requires it to be filed within the time to file a notice of appeal. But defendants didn’t raise the timeliness argument before the trial court. And the Court of Appeal finds that they forfeited it.
Which is fine, because although the Court of Appeal doesn’t say so here, the deadlines in Rule 3.1702 are not jurisdictional. They can be extended for good cause, and consequently, objections based upon them can be forfeited by failing to timely raise them in superior court.
The Court of Appeal goes on to partially reverse for a different reason.
Reversed in part.
This is a pretty nasty land dispute over a right of first refusal to buy some farmland. The prevailing Plaintiffs sought attorneys’ fees under various theories, but allegedly filed their fee app a day too late under Rule of Court 3.1702(b), which requires it to be filed within the time to file a notice of appeal. But defendants didn’t raise the timeliness argument before the trial court. And the Court of Appeal finds that they forfeited it.
Which is fine, because although the Court of Appeal doesn’t say so here, the deadlines in Rule 3.1702 are not jurisdictional. They can be extended for good cause, and consequently, objections based upon them can be forfeited by failing to timely raise them in superior court.
The Court of Appeal goes on to partially reverse for a different reason.
Reversed in part.
Tuesday, April 7, 2020
New Formatting Rules
I haven’t yet had occasion to file an appellate brief in either the Court of Appeal or Supreme Court this year. But I just noticed the Rules of Court on some formatting issues were amended as of 1/1/20. Typical for California, instead of changing Rule of Court 8.40—which governs the “Form of Filed Documents”—they are instead codified in Rule 8.75 8.74,* which facially deals with the “Format of Electronic Documents.” If we were going to put all the rules on a single issue in one place, we wouldn’t be California.
The changes are generally consistent with the formatting changes applied in Second District opinions since late 2016.
They call for:
• Century Schoolbook 13-point font
• 1.5x spacing
• 1 1/2 inch left and right margins, except for quotes and footnotes, 1 inch top and bottom
• Left aligned, not right justified, text
*Thanks to the commenter for the correction.
The changes are generally consistent with the formatting changes applied in Second District opinions since late 2016.
They call for:
• Century Schoolbook 13-point font
• 1.5x spacing
• 1 1/2 inch left and right margins, except for quotes and footnotes, 1 inch top and bottom
• Left aligned, not right justified, text
*Thanks to the commenter for the correction.
Monday, April 6, 2020
Domestic Waiver Obviates Need for Service Abroad
Rockefeller Tech. Inv. (Asia) VII v. Changzhou Sinotype Tech., Ltd., No. S249923 (Cal. Apr. 2, 2020)
Back in 2018, the Court of Appeal vacated an arbitration award entered by default. The defaulting defendant agreed in a contract to service by FedEx. But the Court of Appeal ruled that FedEx service was nonetheless impermissible, because the defendant was in China and China objected to Article 10 of Hague Service Convention, which permits service through postal channels. As I said back then, the reasoning of the case seemed somewhat overbroad. Evidently, the California Supreme Court agreed, as it granted review and here reverses the Court of Appeal.
Indeed, the Supreme Court seems to have found the Court of Appeal’s decision even more overbroad then I did. In a unanimous opinion by Justice Corrigan, the Court discerns three principles out of the U.S. Supreme Court’s Hague Convention jurisprudence. First, the Hague applies only to “service of process in the technical sense,” i.e., to the process for formal delivery of whatever documents the lexi fori—the law of forum jurisdiction—determines are required to establish jurisdiction and notice. Second, whether there is occasion for transmission of documents for service abroad is also a lex fori issue. And third, if foreign service of process is required, that service must comply with the Hague.
Here, the analysis doesn’t need to get past step two. Service of process fulfills two roles. It is required for a court to establish personal jurisdiction over the defendant. And it is required to afford the defendant notice of the proceedings. But under California law (and the law of every U.S. jurisdiction I’m aware of) a party can consent to both personal jurisdiction and the form of notice, even it would not otherwise satisfy statutory or constitutional standards. Both California and federal cases recognize that such consent can be obtained in a pre-dispute contract.
Here, Defendant consented to personal jurisdiction in California when it agree to arbitrate its claims under the pertinent contract in a JAMS-administered arbitration in LA. See Code Civ. Proc. § 1293. It also consented to notice by FedEx as adequate “service of process.” Indeed, with regard to arbitrations, the Code of Civil Procedure specifically recognizes that arbitration initiating documents can “be served in the manner provided in the arbitration agreement for the service of such petition and notice.” § 1290.4(a).
Thus, because, under California law, formal service was unnecessary based on the parties’ agreement, there was no occasion to transmit service of formal process abroad. That being the case, the Hague is not implicated.
Court of Appeal reversed.
Back in 2018, the Court of Appeal vacated an arbitration award entered by default. The defaulting defendant agreed in a contract to service by FedEx. But the Court of Appeal ruled that FedEx service was nonetheless impermissible, because the defendant was in China and China objected to Article 10 of Hague Service Convention, which permits service through postal channels. As I said back then, the reasoning of the case seemed somewhat overbroad. Evidently, the California Supreme Court agreed, as it granted review and here reverses the Court of Appeal.
Indeed, the Supreme Court seems to have found the Court of Appeal’s decision even more overbroad then I did. In a unanimous opinion by Justice Corrigan, the Court discerns three principles out of the U.S. Supreme Court’s Hague Convention jurisprudence. First, the Hague applies only to “service of process in the technical sense,” i.e., to the process for formal delivery of whatever documents the lexi fori—the law of forum jurisdiction—determines are required to establish jurisdiction and notice. Second, whether there is occasion for transmission of documents for service abroad is also a lex fori issue. And third, if foreign service of process is required, that service must comply with the Hague.
Here, the analysis doesn’t need to get past step two. Service of process fulfills two roles. It is required for a court to establish personal jurisdiction over the defendant. And it is required to afford the defendant notice of the proceedings. But under California law (and the law of every U.S. jurisdiction I’m aware of) a party can consent to both personal jurisdiction and the form of notice, even it would not otherwise satisfy statutory or constitutional standards. Both California and federal cases recognize that such consent can be obtained in a pre-dispute contract.
Here, Defendant consented to personal jurisdiction in California when it agree to arbitrate its claims under the pertinent contract in a JAMS-administered arbitration in LA. See Code Civ. Proc. § 1293. It also consented to notice by FedEx as adequate “service of process.” Indeed, with regard to arbitrations, the Code of Civil Procedure specifically recognizes that arbitration initiating documents can “be served in the manner provided in the arbitration agreement for the service of such petition and notice.” § 1290.4(a).
Thus, because, under California law, formal service was unnecessary based on the parties’ agreement, there was no occasion to transmit service of formal process abroad. That being the case, the Hague is not implicated.
Court of Appeal reversed.
Christynne, I am not your lawyer...
Wood v. Superior Court, No. D076325 (D4d1 Mar. 13, 2020)
Plaintiff, a transgender woman, lodged a FEHA complaint against her gym with the DFEH. DFEH decided to bring suit. Plaintiff intervened. In discovery, Plaintiff claimed attorney-client privilege over some of her communications with the DFEH’s lawyers. The trial court overruled the privilege. Plaintiff took a writ, which the Court of Appeal denies.
The DFEH’s lawyers represent DFEH, not Plaintiff, a fact of which Plaintiff was apparently aware. Plaintiff might well have sought legal advice from the DFEH counsel. But that’s not enough to bring the communications within the privilege. By statute, a communication is subject to the attorney-client privilege only if it is “made in the course of an attorney-client relationship.” Evidence Code § 352. If there’s no reason to believe that an attorney client relationship existed between Plaintiff and the lawyers, there’s no privilege from the getgo.
Writ denied.
Plaintiff, a transgender woman, lodged a FEHA complaint against her gym with the DFEH. DFEH decided to bring suit. Plaintiff intervened. In discovery, Plaintiff claimed attorney-client privilege over some of her communications with the DFEH’s lawyers. The trial court overruled the privilege. Plaintiff took a writ, which the Court of Appeal denies.
The DFEH’s lawyers represent DFEH, not Plaintiff, a fact of which Plaintiff was apparently aware. Plaintiff might well have sought legal advice from the DFEH counsel. But that’s not enough to bring the communications within the privilege. By statute, a communication is subject to the attorney-client privilege only if it is “made in the course of an attorney-client relationship.” Evidence Code § 352. If there’s no reason to believe that an attorney client relationship existed between Plaintiff and the lawyers, there’s no privilege from the getgo.
Writ denied.
Thursday, April 2, 2020
Acknowledgement vs. Consent
Reeve v. Meleyco, No. C085867 (D3 Mar. 24, 2020)
California is in the minority of jurisdictions that permit lawyers to pay referral fees to other lawyers who do not continue to work on a case. Under the Rules of Professional Conduct—old RPC 2-200 and new RPC 1.5.1—the referral fee can’t increase the client’s total bill—it needs to come out of the referred attorney’s take. The attorney also needs to disclose the key facts to the client in writing and the client needs to give written consent.
Here, after being provided with the information, in writing, the client signed an “acknowledgement.” But it did not expressly say the client “consented” to the arrangement. Even though the client later testified that he had, in fact, agreed to the arrangement, the acknowledgement wasn’t enough to satisfy the rule’s requirement of written consent. That rendered the referral contract invalid as a matter of law.
Reversed.
California is in the minority of jurisdictions that permit lawyers to pay referral fees to other lawyers who do not continue to work on a case. Under the Rules of Professional Conduct—old RPC 2-200 and new RPC 1.5.1—the referral fee can’t increase the client’s total bill—it needs to come out of the referred attorney’s take. The attorney also needs to disclose the key facts to the client in writing and the client needs to give written consent.
Here, after being provided with the information, in writing, the client signed an “acknowledgement.” But it did not expressly say the client “consented” to the arrangement. Even though the client later testified that he had, in fact, agreed to the arrangement, the acknowledgement wasn’t enough to satisfy the rule’s requirement of written consent. That rendered the referral contract invalid as a matter of law.
Reversed.
Wednesday, April 1, 2020
Still Aggrieved After All These Years
Kim v. Reins Int’l. Cal., Inc., No. S246911 (Cal. Mar. 12, 2020)
I never thought this 2017 decision made much sense. The California Supreme Court apparently agrees. It holds that a plaintiff’s settlement of his individual Labor Code claims does not moot out his ability to continue to litigate representative claims under the Labor Code Private Attorney General Act.
Court of Appeal reversed.
I never thought this 2017 decision made much sense. The California Supreme Court apparently agrees. It holds that a plaintiff’s settlement of his individual Labor Code claims does not moot out his ability to continue to litigate representative claims under the Labor Code Private Attorney General Act.
Court of Appeal reversed.
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