Untitled Document

Litigation Update

Litigation Section News: January 2016

Senior Editor
Eileen C. Moore, Associate Justice
California Court of Appeal, Fourth District

Managing Editor
Mark A. Mellor, Esq.

Table of Contents of This Issue

"I Don’t Know Why The Girl Had Me Say Those Things. I Was Baited."—Donald Sterling to Anderson Cooper.

A probate court concluded a husband was properly removed as a trustee of a family trust, and that the wife had authority to unilaterally bind the family trust by executing an agreement to see a basketball team owned by the family trust. The court instructed the wife to complete the sale. During the probate proceedings, the husband unsuccessfully sought extraordinary relief from the Court of Appeal, arguing the probate court’s order must be stayed. On appeal, he argued the probate court improperly removed him as trustee and that the lower court abused its discretion in ordering the wife to sell the team. In affirming, the appellate court stated: “The credited evidence overwhelmingly supported the probate court’s conclusion that exigent circumstances warranted the sale of the Clippers to prevent extraordinary loss to the trust. The probate court’s sanctioning the sale was correct even though Donald, who initially agreed to the sale, purportedly revoked the trust in an effort to block the sale. On appeal, Donald fails to demonstrate any legal error and fails to consider the facts in accordance with the proper standards on appeal.” (Sterling v. Sterling (Cal. App. Second Dist., Div. 8; November 16, 2015) 242 Cal.App.4th 185.) http://www.courts.ca.gov/opinions/documents/B258151.PDF

Create Your Member Profile. On-line My State Bar Profile allows you to access the Litigation Section’s members only area, update your contact information, pay your dues online, and more. To set up your account, go to calbar.ca.gov/members. Link to My State Bar Profile "The Habeas Corpus Secures Every Man, Alien Or Citizen, Against Everything Which Is Not Law, Whatever Shape It May Assume."—Thomas Jefferson.

After the California Department of Corrections and Rehabilitation [CDCR] “validated” a Pelican Bay inmate to be a gang associate of the Mexican Mafia, the inmate challenged the decision by filing a habeas corpus petition. [California Code of  Regulations, tit. 15, § 3378(c)(3)-(4), states that once prison officials determine that an inmate is a member, or associate of a prison gang, the inmate is routinely transferred to administrative segregation in the Security Housing Unit.] The inmate had participated in a disturbance involving 200 Hispanic inmates, but he claimed the disturbance involved prison conditions, not gang activity. The superior court granted the petition and ordered the gang validation expunged. The warden appealed. In affirming the trial court’s grant of the inmate’s habeas corpus petition, the Court of Appeal noted the evidence “arguably establishes at most” that the inmate participated in a disturbance ordered by the Mexican Mafia prison gang, but “does not establish a direct link between [the inmate petitioner] and the Mexican Mafa.”  (In re Martinez (Cal. App. First Dist., Div. 2; November 18, 2015) 242 Cal.App.4th 299.) http://www.courts.ca.gov/opinions/documents/A142502.PDF

"Governments Have Monopolies On Certain Things, Like Eminent Domain And Deadly Force,"—P.J. O'Rourke.

A public school sits next to a large piece of private property in a downtown area. The school district requested the trial court to grant it a right to enter the private property to conduct certain investigations and environmental testing under Eminent Domain law. [Code of Civil Procedure section 1245.010, et seq.], with an eye toward potentially expanding the existing school and constructing other school facilities. The owner of the private property argued the school district’s request to conduct the tests, in and of itself, constitutes a taking requiring the school district to file a condemnation suit to litigate the need for the taking and provide the private property owner with a jury determination of compensation. The trial court rejected the argument of the private property owner and granted the school district’s request to conduct the testing.  In affirming, the Court of Appeal stated: “District's activities do not violate either the entry statutes or the state or federal Constitution, and they do not amount to a taking requiring a jury determination of just compensation. The superior court did not err by granting District's petition for an entry order.” (Young's Market Co. v. Sup. Ct. (San Diego Unified School District) (Cal. App. Fourth Dist., Div. 1; November 19, 2015) 242 Cal.App.4th 356.) http://www.courts.ca.gov/opinions/documents/D068213.PDF

"It Has Nothing To Do With Satan, Mama. It’s Me."—Carrie White character in film Carrie

While exiting a haunted house attraction, a patron was confronted by a final scare known as the “Carrie” effect—so named because, like the horror film Carrie, patrons are led to believe the attraction is over, only to be met by one more extreme fright. While running away from an actor wielding a gas powered chainsaw [chain removed], the patron fell, was injured and sued the owner of the attraction. Under the theory of primary assumption of risk, the trial court granted summary judgment to the attraction. In affirming, the Court of Appeal noted there was no evidence the persons operating the attraction unreasonably increased the risk of injury beyond those inherent risks or acted recklessly.” (Griffin v. The Haunted Hotel, Inc. (Cal. App. Fourth Dist., Div. 1; November 20, 2015) 242 Cal.App.4th 490 [194 Cal.Rptr.3d 830].) http://www.courts.ca.gov/opinions/documents/D066715.PDF

"The Primary Purpose . . . Was To Ruin [Former Husband And His New Wife] Financially."—The Trial Court.

Plaintiff is the manufacturer of high-end military style watches, known as MTM Special Ops watches. Defendant, retailer Amazon.com, does not sell these watches, but when a potential buyer inserts “MTM Special Ops” onto its website, a message will direct the person to related searches of “MTM special ops watch,” and show images of watches manufactured by plaintiff’s competitors. Plaintiff claims Amazon infringes its trademark because of the manner in which it responds to a shopper’s search request for trademarked goods. The trial court judge granted summary judgment in favor of Amazon, finding its use of plaintiff’s trademark created no likelihood of confusion as a matter of law. The Ninth Circuit reversed:  “[W]e think a jury could find that Amazon has created a likelihood of confusion.”  (Multi Time Mach., Inc. v. Amazon.com, Inc. (Ninth Cir.; July 6, 2015) 792 F.3d 1070.)

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MSJ Decided On Issue Not Briefed.

The appellate court decided a motion for summary judgment in favor of the moving party on an issue not briefed by the parties nor considered by the trial court. In doing so, the appellate court stated: “Thus, the record established that [the opposing party] ‘could not have shown a triable fact issue’ had the point relied upon by the trial court been raised by the moving party. (Marlton Recovery Partners, LLC v. County of Los Angeles (Cal. App. Second Dist., Div. 1; November 20, 2015) 242 Cal.App.4th 510.) http://www.courts.ca.gov/opinions/documents/B257400.PDF

No Asylum For Abused Gay Man.

A man brought a petition for review of an immigration board’s denial of asylum to the Ninth Circuit Court of Appeals under the Convention Against Torture [CAT] based on his sexual orientation and HIV-positive status. The man testified he was raped and otherwise sexually abused by his uncle, his cousins and a neighbor, and that his abusers referred to him using homophobic slurs, telling him they were abusing him because he was gay. He said his abusers punched and beat him, and threatened to hurt him and his grandmother if he told anyone about the abuse. The man never reported the abuse to Mexican police because friends had told him the police would laugh at him and tell him he deserved the abuse he received. The majority opinion of the appeals court found the immigration board’s determination the man failed to establish that the Mexican government was unwilling or unable to protect him, where he did not report the abuse he suffered to authorities. The dissenting justice stated: “Bringas-Rodriguez, like most abused children, did not report to the police the sexual abuse he suffered. Thus, when seeking aslyum, Bringas-Rodriguez had to rely on other evidence of the Mexican government’s inability or unwillingness to protect him. He provided 2009 and 2010 country reports describing police indifference to, and participation in, discrimination and violence against homosexuals. He also testified that his gay friends told him that when they reported to the Mexican police in his home state of Veracruz similar abuse they had suffered, the police laughed in their faces and told them that they deserved the abuse they were receiving. That should be enough.” (Bringas-Rodriguez v. Lynch (Ninth Cir.; November 19, 2015) 805 F.3d 1171.) http://cdn.ca9.uscourts.gov/datastore/opinions/2015/11/19/13-72682.pdf

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County Immune.

A high school student took a swing on a rope swing attached to a tree in a county park. The rope broke and the boy was seriously injured when he hit debris below, which debris included cut-down tree limbs and brush left by county maintenance workers. Afterward, an expert opined the rope was damaged from exposure to the sun for over three months. The injured boy sued the county for negligence and dangerous condition of public property. The trial court denied the county’s motion for summary judgment, and the county petitioned for extraordinary relief. The Court of Appeal issued a peremptory writ of mandate, ordering the trial judge to grant the motion for summary judgment because the county is immune from liability pursuant to Government Code section 831.7. (County of San Diego v. Sup. Ct. (Ben Casteen) (Cal. App. Fourth Dist., Div. 1; November 20, 2015) 242 Cal.App.4th 460.) http://www.courts.ca.gov/opinions/documents/D068016.PDF

No Landlord Liability For Unknown Dangerous Condition Brought Onto Premises By Tenant.

A landscaper was injured by explosives brought onto the property by a tenant of the property’s owner. The trial court entered summary judgment in favor of the owner of the residence. On appeal, the plaintiff contended a month-to-month tenancy provides the landlord the right to enter and inspect the property at periodic intervals. The Court of Appeal noted that, while there are exceptions, public policy precludes landlord liability for a dangerous condition on the premises which came into existence after possession had passed to a tenant. In affirming, the appellate court stated it was undisputed the landlord knew nothing about the explosives, and that the plaintiff presented no evidence giving rise to a triable issue of fact about whether the landlord had a reason to know an inspection was necessary. (Garcia v. Holt (Cal. App. Fourth Dist., Div. 1; November 23, 2015) 242 Cal.App.4th 600.) http://www.courts.ca.gov/opinions/documents/D066393.PDF

Membership in the ADR Subcommittee.  The Litigation Section ADR Subcommittee, which is comprised of both ADR professionals and advocates, focuses on recent case law and legislative developments in the field of alternative dispute resolution. The ADR Subcommittee also provides educational programs on ADR issues. Members of the Litigation Section who wish to join the ADR Subcommittee should send an e-mail and resume to the co-chairs of the Committee: Jeff Dasteel (Jeffrey.dasteel@gmail.com) and Don Fischer (donald.fischer@fresno.edu). Emil to Don Fischer Email to Jeffrey Dasteel No Motion To Quash Permitted By Tenant Served With A Three Day Notice To Quit.

The issue is whether the tenant in an unlawful detainer action may bring a motion to quash service of the summons on the ground that the landlord did not properly serve the three-day notice to pay rent or quit required under the Unlawful Detainer Act. [Civ.Proc. §§ 1159-1179a.] The Court of Appeal stated: “We conclude that the tenant may not challenge the allegedly defective service of the three-day notice via a motion to quash service of summons because the three-day notice is an element of an unlawful detainer action. In so holding, we disagree with the broad language of Delta Imports, Inc. v. Mun. Court (1983) 146 Cal.App.3d 1033 [194 Cal.Rptr. 685], which held that a motion to quash service is the only method to challenge whether a complaint states a cause of action for unlawful detainer.” (Borsuk v. Appellate Division of Superior Court (LA Hillcreste Apartments, LLC)(Cal. App. Second Dist., Div. 4; November 23, 2015) 242 Cal.App.4th 607.) http://www.courts.ca.gov/opinions/documents/B265613.PDF

"Tired Mothers Find That Spanking Takes Less Time Than Reasoning And Penetrates Sooner To The Seat Of Memory."—Will Durant.

A mother of two children, one born in 2007 and the other in 2010, disciplined the children “by making them do chores, by scolding them verbally, by denying them privileges. . . and by threatening to spank them. On rare occasions when these techniques did not work, she would spank the children on the buttocks with her bare hand or with a sandal. . . The spankings were not hard enough to leave marks or bruises.” Social services representatives filed a petition in juvenile court alleging the mother inflicted serious physical harm. The juvenile court sustained the allegation, reasoning that hitting children with shoes is physical abuse and not a proper form of discipline. In reversing the court’s jurisdictional finding based upon physical abuse, the Court of Appeal majority stated: “Because the court did not consider the genuineness, necessity or reasonableness of mother’s use of spanking as a disciplinary measure, the juvenile court’s seemingly blanket rule is inconsistent with the law.” The matter was remanded for further proceedings for the court to examine whether the mother’s conduct falls within her right to reasonably discipline her children. The dissenting Justice stated the juvenile court was in the best position to decide whether “these young children were at risk of serious physical harm at the hands of their overworked, single mother,” and that substantial evidence supports the juvenile court’s decision.  (In re D.M. (Cal. App. Second Dist., Div. 2; November 24, 2015) 242 Cal.App.4th 634.) http://www.courts.ca.gov/opinions/documents/B260549.PDF

Use Of Judicially Noticed Records In Ruling On A Demurrer.

The Court of Appeal held:  Plaintiffs sued defendants for trade secret misappropriation. The trial court sustained defendants’ demurrer on the ground that plaintiffs’ claims were barred by the Taiwanese statute of limitations. On appeal, plaintiffs contend the trial court erred in sustaining the demurrer because it resolved disputed issues of fact based on information from judicially noticed documents. The appellate court noted that “In order for the bar [of statute of limitations] . . . to be raised by demurrer, the defect must clearly and affirmatively appear on the face of the complaint [and matters subject to judicial notice]; it is not enough that the complaint shows that the action may be barred.” Here, the trial court had taken judicial notice of complaints filed in Taiwan, but the Court of Appeal concluded, that while the trial court could properly judicially notice the existence of those complaints, it was error “to use the allegations in those complaints to resolve factual disputes for purposed of the demurrer in this case.” In reversing, the Court of Appeal held: “Utilizing judicially noticed documents in ruling on a demurrer is only proper when the documents are not used to determine disputed factual issues, such as the timing of acquisition of knowledge of the misappropriation of customer information or power supply technology.” (Richtek USA, Inc. v. UPI Semiconductor Corp. (Cal. App. Sixth Dist.; November 24, 2015) 242 Cal.App.4th 651.) http://www.courts.ca.gov/opinions/documents/H039519.PDF

Contracts Negotiated In A Foreign Language.

Plaintiffs purchased a used automobile after negotiations were conducted in Spanish. When a dispute arose, plaintiffs sued the automobile sales company. Defendant moved for arbitration, attaching a Spanish translation of the underlying sales contract, which included an arbitration agreement, in its petition. Plaintiffs produced a Spanish translation of the underlying sales contract, which contained no arbitration agreement. The trial court denied the petition to compel arbitration. The Court of Appeal affirmed, stating: “[Civil Code] section 1632 requires merchants to provide translations of certain contracts (including retail installment contracts for automobiles) when those contracts are negotiated primarily in a foreign language. (Civ.Code § 1632, subd. (b).) The Legislature enacted the statute to ‘increase consumer information and protections for the state’s sizeable and growing Spanish-speaking population.’ (Civ.Code § 1632, subd. (a)(1).) The very purpose behind this provision is to ensure that non-English speaking customers receive accurate information regarding the terms and conditions of the contracts they are being asked to sign.” (Ramos v. Westlake Services LLC (Cal. App. First Dist., Div. 2; October 30, 2015) (Ord. Pub. November 24, 2015) http://www.courts.ca.gov/opinions/documents/A141353.PDF

Mandatory Duty To Cross-Report Child Abuse; Summary Judgment Reversed By California Supreme Court.

CANRA [Pen. Code § 11164; Child Abuse and Neglect Reporting Act] is intended to protect children from abuse and neglect. CANRA designates certain agencies to accept reports of alleged child abuse or neglect and cross-report the information to other agencies. A private citizen called 911 to report an incident of suspected child abuse during the child’s visit with his father. A deputy sheriff determined there was an ongoing custody dispute between the parents, and the child was not a victim of child abuse, and there was no need for further investigation. No cross-report was made to the child welfare agency. About three weeks later, the child suffered extensive head injuries during a visit with his father. Through his guardian ad litem, the child sued the county and the deputy for failing to cross-report the initial child abuse allegations to the child welfare agency. The trial court granted defendants’ motion for summary judgment, and the Court of Appeal affirmed. The California Supreme Court concluded “that the Sheriff‘s Department had a mandatory and ministerial duty to cross-report the child abuse allegations made to the 911 operator to the child welfare agency and that the failure to cross-report can support a finding of breach of a mandatory duty, elements required to establish public entity liability. (§ 11166, subd. (k); Gov. Code, § 815.6.) We further conclude that the officer had no duty to report the child abuse allegations and her investigative findings to the child welfare agency. (§ 11166, subd. (a).) Accordingly, we affirm the judgment of the Court of Appeal in part and reverse in part.” Thus, the court concluded the County Sheriff’s Department had a mandatory duty to inform the County child welfare agency of the previous 911 call, but the deputy did not. Justice Liu dissented, stating he would have reversed the grant of summary judgment in favor of both the department and the deputy. (B.H. v. County of San Bernardino (Cal. Sup. Ct.; November 30, 2015) 62 Cal.4th 168 [195 Cal.Rptr.3d 220, 361 P.3d 319].) http://www.courts.ca.gov/opinions/documents/S213066.PDF

Saying "No, You Can’t Have The Documents," Can Be Costly.

A shipping association requested documents from the port agent for a few California ports under the Public Records Act [Government Code section 6250, et seq.]. A port agent refused and the association filed a Writ of Mandate, which the trial court granted and which order the Court of Appeal declined to overturn. Thereafter, the port agent produced more than 1,000 square feet of oversized documents, and the association filed a motion for attorney fees and costs. The trial court ordered the port agent to pay the association $260,608, and, once again, the Court of Appeal declined to overturn the trial court’s order. (Pacific Merchant Shipping Assn. v. Board of Pilot Commissioners etc. (Cal. App. First Dist., Div. 5; November 6, 2015) (Ord. Pub. December 3, 2015) 242 Cal.App.4th 1043 [195 Cal.Rptr.3d 358].) http://www.courts.ca.gov/opinions/documents/A142634.PDF

Court Declined To Create A New Exception To The Collateral Estoppel Rule.

Years ago, the juvenile court terminated plaintiff’s parental rights to her daughter and the Court of Appeal affirmed, rejecting plaintiff’s contention of ineffective assistance of counsel by her appointed juvenile dependency lawyers. Thereafter, plaintiff filed the current action for legal malpractice against the same lawyers. The trial court granted the lawyers’ motion for summary judgment. On appeal, plaintiff contended the lawyers put in place a juvenile case plan that was doomed to fail, and further failed to file and refused to pursue a writ of habeas corpus after her parental rights were terminated. She also contended she was restricted in the type of evidence she could present in her ineffective assistance claim and never had a full and fair opportunity to litigate the causation issue in the juvenile case. The Court of Appeal found the causation issue raised in the underlying juvenile appeal was whether the alleged deficiencies in counsel’s performance caused the termination of parental rights, which “is the same issue that [plaintiff] seeks to litigate here.” (Kemper v. County of San Diego (Cal. App. Fourth Dist., Div. 1; December 4, 2015) 242 Cal.App.4th 1075.) http://www.courts.ca.gov/opinions/documents/D066289.PDF

Petition Denied; Had It Been Granted, It Would Have Resulted In 1,491 Mini-Trials.

A mass tort litigation over environmental contamination beneath a housing track settled, and the court was called upon to address whether a government-ordered environmental cleanup was part of the settlement consideration, and whether a good faith settlement could be approved without an individualized allocation of the settlement proceeds among the numerous plaintiffs and between their economic and noneconomic damages. In denying the petition for extraordinary relief brought by nonsettling developer defendants, the Court of Appeal stated: “[Petitioners] contend the exclusion of the cost of the RAP [Remedial Action Plan]  from the settlement valuation is collusive and will enable Plaintiffs to obtain a windfall, by reducing the amount that will be set off against the nonsettling defendants’ liability. . . we [also] address whether the trial court erred in approving the $90 million good faith settlement between Plaintiffs and Shell without an allocation of the settlement proceeds among the various Plaintiffs, and between their economic and noneconomic damages . . . Although the trial court gave some weight to the value of the RAP remediation in approving the good faith settlements, the error was harmless . . . the determination of good faith settlement did not require an allocation of the $90 million settlement consideration among the 1,491 individual Plaintiffs and between their economic and noneconomic damages. Such individualized allocations, which would have necessitated 1,491 mini-trials in this matter, are not required as part of the good faith settlement process.” (Dole Food Co., Inc. v. Sup. Ct. (Shell Oil Company) (Cal. App. Second Dist., Div. 3; December 1, 2015) 242 Cal.App.4th 894 [195 Cal.Rptr.3d 461].) http://www.courts.ca.gov/opinions/documents/B262044.PDF

Previously We Reported: The First Ninth Circuit Opinion: No Jurisdiction.

Plaintiff brought an action against an Austrian-owned railway as a result of her attempting to board a moving train in Innsbruck. She purchased a Eurail pass in California from Rail Pass Experts, a company based in Massachusetts. When attempting to board the train, she fell to the tracks through a gap in the platform and suffered injuries that ultimately required the amputation of both legs above the knees. She filed a complaint for negligence, failure to warn and design defect in California against the Republic of Austria. The district court dismissed the action and the Ninth Circuit affirmed, noting the sole basis by which courts in the United States may obtain jurisdiction over foreign states is the Foreign Sovereign Immunities Act [28 U.S.C. § 1602], and holding no exception applied.  (Sachs v. Republic of Aus. (Ninth Cir.; September 26, 2012) (Superseded, en banc) 695 F.3d 1021.) http://cdn.ca9.uscourts.gov/datastore/opinions/2012/09/26/11-15458.pdf

The Second Ninth Circuit Opinion, En Banc:
The Ninth Circuit, en banc, heard the case and held otherwise.  In reversing and remanding, the court stated: “We hold that the first clause of the FSIA commercial activity exception applies to a common carrier owned by a foreign state that acts through a domestic agent to sell tickets to United States citizens or residents for passage on the foreign common carrier’s transportation system.”  (Sachs v. Republic of Aus. (Ninth Cir.; December 6, 2013) (Reversed) 737 F.3d 584.) http://cdn.ca9.uscourts.gov/datastore/opinions/2013/12/09/11-15458%20web%20corrected.pdf

The Recent Opinion Of The United States Supreme Court:
The United States Supreme Court reversed the Ninth Circuit en banc decision stating: “The Foreign Sovereign Immunities Act shields foreign states and their agencies from suit in United States courts unless the suit falls within one of the Act’s specifically enumerated exceptions. This case concerns the scope of the commercial activity exception, which withdraws sovereign immunity in any case ‘in which the action is based upon a commercial activity carried on in the United States by [a] foreign state.’ 28 U.S.C. § 1605(a)(2). Respondent Carol Sachs is a resident of California who purchased in the United States a Eurail pass for rail travel in Europe. She suffered traumatic personal injuries when she fell onto the tracks at the Innsbruck, Austria, train station while attempting to board a train operated by the Austrian state-owned railway. She sued the railway in Federal District Court, arguing that her suit was not barred by sovereign immunity because it is ‘based upon’ the railway’s sale of the pass to her in the United States. We disagree and conclude that her action is instead ‘based upon’ the railway’s conduct in Innsbruck. We therefore hold that her suit falls outside the commercial activity exception and is barred by sovereign immunity.” (OBB Personenverkehr AG v. Sachs (2015) ___U.S.___ [136 S.Ct. 390, 193 L.Ed.2d 269, 25 Fla. L. Weekly Fed. S. 561].) http://www.supremecourt.gov/opinions/15pdf/13-1067_onkq.pdf

For Asylum Purposes, Persecution Because A Person Has “Membership In A Particular Social Group” May Include The Person’s Family.

To be eligible for asylum relief, a petitioner is required to establish refugee status, i.e., that he is an alien unwilling or unable to return home “because of persecution or a well-founded fear of persecution on account of race, religion, nationality, membership in a particular social group, or political opinion.” [entered the United States without inspection on September 10, 2007.] On June 15, 2009, gang members killed his father outside of his father’s Evangelical Christian church in Guatemala. Petitioner’s cousin witnessed the murder and agreed to testify against the perpetrators. She was murdered the day before the hearing. Petitioner asserts that she was killed in retaliation for her willingness to cooperate with the authorities and to prevent her appearance as a witness against the gang members who killed his father. In the wake of his cousin’s death, petitioner’s sister began receiving threats, even though she had neither witnessed the attack on her father nor agreed to testify against the gang members responsible. Due to these threats, she felt compelled to flee to the United States. Both an immigration judge and the Board of Immigration Appeals [BIA] denied petitioner’s plea for asylum relief. Noting that “membership in a particular social group” is an enigmatic and difficult to define term, the Ninth Circuit remanded the matter, stating: “In the face of [petitioner’s] social group claim and the evidence that gang members killed [his] father, murdered his cousin and threatened his sister, the BIA erred in not addressing the family aspect of [petitioner’s] social group claim.” (Rios v. Loretta E. Lynch, Attorney General (Ninth Cir.; December 1, 2015) (Case No. 12-72551).) http://cdn.ca9.uscourts.gov/datastore/opinions/2015/12/01/12-72551.pdf

Food Labeling Action Is Not Preempted.

Defendant is a large herb-growing operation with multiple farms throughout California. Most of the farms use conventional growing methods, but one of them uses organic processes. Nonetheless, when it comes time for distribution, defendant packs the conventionally and organically grown herbs in the same packing and labeling facility, processes them together and labels them “Fresh Organic.” In noting that “labels matter” and holding the California case was not preempted by federal law, the California Supreme Court stated: “We hold a state law claim that produce is being intentionally mislabeled as organic is not preempted. When Congress entered the field in 1990, it confined the areas of state law expressly preempted to matters related to certifying production as organic, leaving untouched enforcement against abuse of the label ―organic. Moreover, a central purpose behind adopting a clear national definition of organic production was to permit consumers to rely on organic labels and curtail fraud. Accordingly, state lawsuits alleging intentional organic mislabeling promote, rather than hinder, Congress‘s purposes and objectives.” (Quesada v. Herb Thyme Farms, Inc. (Cal. Sup. Ct.; December 3, 2015) 62 Cal.4th 298.) http://www.courts.ca.gov/opinions/documents/S216305.PDF

Judicially Forced Waiver Of Privileged Documents Not Authorized, Even When Privilege Log Is Inadequate.

A former member of the board of directors of a yacht club sued the club and its board, alleging they conspired to remove him and suspend his membership. His pleading alleges libel, slander, invasion of privacy and IIED. Plaintiff sought to inspect documents, and defendants responded with boilerplate objections based on the attorney-client privilege and the work product doctrine. Two months later, defendants served plaintiff an inadequate privilege log. The court became involved and defendants served a supplemental log, increasing the number of withheld documents from 17 to 36. The gamesmanship continued. Plaintiff responded with a motion for sanctions. The trial court granted the motion and ordered defendants to produce 167 emails, and pay $1,140 in monetary sanctions. On the defendants’ petition for extraordinary relief, this is how the Court of Appeal framed and analyzed the issue: “May a trial court find a waiver of the attorney-client privilege and work product doctrine when the objecting party submits an inadequate privilege log that fails to provide sufficient information to evaluate the merits of the objections? No. [¶] . . . a trial court may order the responding party to provide a further privilege log that includes the necessary information to rule on those objections, but may not order the privileges waived based on deficiencies in the privilege log. . . The court may impose monetary sanctions for providing a deficient privilege log, and it may impose evidence, issue, and even terminating sanctions. . . but a forced waiver is not authorized by either the statutory scheme establishing the attorney-client privilege or the discovery statutes once the responding party preserves the objections by timely asserting them in response to an inspection demand.” (Catalina Island Yacht Club v. Sup.Ct. (Timothy Beatty)(Cal. App. Fourth Dist., Div. 3; December 4, 2015) 242 Cal.App.4th 1116 [195 Cal.Rptr.3d 694].) http://www.courts.ca.gov/opinions/documents/G052062.PDF

Judgment Reversed After Trial Court Adopted Referee’s Recommendations.

A matter concerning environmental cleanup was tried before a referee pursuant to stipulation and judgment was entered by the trial court adopting the referee’s recommendations. Finding numerous errors, the Court of Appeal reversed. First, the appellate court found extrinsic evidence should not have been introduced in interpreting the contract. Second, the appellate court concluded the referee misinterpreted the indemnity provision, which stated: “Seller agrees to indemnify . . . from and against any claims, demands, penalties, fees, fines, liability, damages, costs, losses, or other expenses including, without limitation, reasonable environmental consulting fees and reasonable attorney fees . . .” Rejecting defendant’s contention the indemnity clause pertained only to third party claims, the Court of Appeal stated: “Indemnity provisions typically refer to third party claims, but if the parties so intend, such provisions may also encompass direct claims.” Third, the appellate court found the award of $1 million for loss of use of the contaminated property lacked sufficient evidence to support it in that plaintiff chose “to focus its case on diminution in value.” The appellate court noted plaintiff was unable to “point of any evidence at all to support that number [$1 million].”  The only monetary damages which survived on appeal totaled $117,050 for loss of rental income and the cost of an air study. (Hot Rods, LLC v. Northrop Grumman Systems Corp.(Cal. App. Fourth Dist., Div. 3; December 7, 2015) 242 Cal.App.4th 1166.) http://www.courts.ca.gov/opinions/documents/G049953.PDF

"One Of These Days, Alice….Pow…Straight To The Moon!" Ralph Kramden. (but spousal battery is no longer funny . . and no longer tolerated.)

Indirect touching is sufficient to constitute a battery. A criminal defendant [the hubby] contended there was no indirect touching of his wife because the only thing that happened was that his car collided with another car being driven by his wife. The Court of Appeal rejected his argument stating: “[W]e conclude [defendant] did commit a battery because the evidence demonstrated that the force of the collision he intentionally caused almost made the victim lose control of her car and, as a result, she had to wrestle with the steering wheel in order to keep her car on the road and avoid hitting other vehicles parked along the curb. Although there is a dearth of California case law addressing criminal battery consisting of this type of indirect touching--one vehicle striking another without direct contact with the victim – our decision is consistent with case law from other jurisdictions which have considered the issue.”(People v. Dealba (Cal. App. Second Dist., Div. 3; December 7, 2015) 242 Cal.App.4th 1142 [195 Cal.Rptr.3d 848].) http://www.courts.ca.gov/opinions/documents/B250771.PDF

Statutory Interpretation.

The general rule is that statutes, including those clarifying existing law, do not operate retrospectively. In Western Security Bank v. Superior Court (1997) 15 Cal.4th 232 [62 Cal.Rptr.2d 243, 933 P.2d 507],the California Supreme Court held that, despite that general rule, when the Legislature promptly reacts to the emergence of a novel question of statutory interpretation by the courts, “[a]n amendment which in effect construes and clarifies a prior statute must be accepted as the legislative declaration of the meaning of the original act, where the amendment was adopted soon after the controversy arose concerning the proper interpretation of the statute.” That holding was applied in a recent criminal case where a defendant previously convicted of child molestation asked the court for a certificate of rehabilitation, which would result in relief from having to register as a sex offender.  In 2014, the Court of Appeal held that denying the defendant a right to petition for a certificate of rehabilitation violates equal protection principles. Soon thereafter, the California Legislature amended three Penal Code sections to clearly state this man’s convictions rendered him ineligible to apply for a certificate of rehabilitation.  Meanwhile, the California Supreme Court had granted review of the Court of Appeal’s decision, and ordered the intermediate court to consider the matter once again. The latest decision holds the defendant is not eligible to apply for a certificate of rehabilitation “because the amendments to the statutes clarify that defendant is not treated differently from others similarly situated.” (People v. Tirey (Cal. App. Fourth Dist., Div. 3; December 8, 2015) 242 Cal.App.4th 1255 [195 Cal.Rptr.3d 568].) http://www.courts.ca.gov/opinions/documents/G048369B.PDF

Shame On The Legal Profession.

In a breach of contract/breach of fiduciary duty/elder abuse action, a lawyer representing himself threatened opposing counsel with pepper spray and a stun gun at a deposition. When defendants moved for terminating sanctions, the lawyer plaintiff included in his opposition that the trial judge was a “former D.A. currently masquerading as a Superior Court Judge” and was defense counsel’s “pet dog.” He submitted a proposed order for the trial judge’s “rubber stamping.” The trial court granted terminating sanctions. The Court of Appeal noted that courts have inherent authority to dismiss a case as a sanction, but such authority should be exercised only in extreme situations, “such as where the conduct was clear and deliberate and no lesser sanction would remedy the situation.” The appeals court affirmed the grant of terminating sanctions, stating: “Here the practice of law became more than stressful; it was dangerous.” (Crawford v. JPMorgan Chase Bank, N.A. (Cal. App. Second Dist., Div. 6; December 9, 2015) 242 Cal.App.4th 1265 [195 Cal.Rptr.3d 868].) http://www.courts.ca.gov/opinions/documents/B257412.PDF

Summary Judgment Reversed In Wrongful Termination Action.

More than a year after plaintiff’s employment was terminated, he brought an action against his employer for common law wrongful termination against public policy, contending he was treated unfairly and discriminated against because he suffered a work-related injury and was disabled. Defendant employer brought a motion for summary judgment, arguing plaintiff’s action is barred by the exclusivity doctrine under Workers’ Compensation statutes and the one-year statute of limitations under the Fair Employment and Housing Act [Government Code section 12900 et seq.; FEHA]. The trial court granted defendant’s motion. The Court of Appeal reversed, stating: “[W]e conclude [plaintiff’s complaint] sufficiently alleged essential facts to inform [defendant] that he was alleging a common law cause of action for wrongful termination in violation of FEHA’s  public policy against disability discrimination. . . . Contrary to [defendant’s] assertion and the trial court’s conclusion, [plaintiff’s] common law tort cause of action for wrongful termination in violation of public policy is not barred by FEHA’s one-year statute of limitations. Instead, Code of Civil Procedure section 335.1 applies, providing a two-year statute of limitations for tort actions based on injuries to plaintiffs caused by the wrongful act, or neglect of others.” (Prue v. Brady Co./San Diego, Inc. (Cal. App. Fourth Dist., Div. 1; November 17, 2015) (Ord. Pub.; December 11, 2015) 242 Cal.App.4th 1367 [196 Cal.Rptr.3d 68].) http://www.courts.ca.gov/opinions/documents/D066404.PDF

No Age Discrimination By Athletic Club.

An athletic club offers a range of membership levels, providing various privileges at one or more locations. The Young Professional program—at issue in this litigation—offers a reduced-cost membership for individuals ages 18 to 29, in recognition of the reduced financial resources of the under-30 age group. Launched in 2003, the program is offered at all but two of defendant’s facilities, and restricts access hours at two of defendant’s other facilities. Plaintiff sued the club under the Unruh Civil Rights Act [Civil Code section 51 et seq.] and the unfair competition law [Business and Professions Code section 17200 et seq.]. The trial court granted defendant’s motion for summary judgment, and the appellate court affirmed, stating: “Finding no arbitrary, unreasonable, or invidious discrimination, we will affirm the judgment.” (Javorsky v. Western Athletic Clubs, Inc. (Cal. App. First Dist., Div. 5; December 11, 2015) 242 Cal.App.4th 1386 [195 Cal.Rptr.3d 706].) http://www.courts.ca.gov/opinions/documents/A142254.PDF

"Justice Delayed Is Justice Denied," William Gladstone. [Well …. Maybe Not.]

The original action, which included claims for violations of the Racketeer Influenced and Corrupt Organizations Act [RICO; 18 U.S.C. §§ 1961-68], was filed in 1993 against multiple defendants. The foreign defendants were dismissed from the action based upon forum non conviens, and, after two decades in a Singapore arbitration against those foreign defendants, plaintiff was awarded $9 million, which award was fully paid. Thereafter, plaintiff, the manufacturer and distributor of semiconductor products, proceeded in federal court against the defendants for relief under RICO’s treble damages provision. The trial court granted defendants’ motion for summary judgment, holding that an award of additional damages under RICO would violate the “one satisfaction” rule, an equitable principle designed to prevent double recovery of damages arising from the same injury. The Ninth Circuit reversed, stating: “The Singapore arbitration was limited in scope to those claims against the Foreign Defendants arising under Singapore law, and could not fully resolve [plaintiff’s] legal claims against the Defendants, which were pending in the federal court action. Specifically, Singapore law could not provide the resolution of Plaintiff’s RICO claims, which were asserted in the original federal lawsuit. As [plaintiff’s] expert noted, ‘the concept of treble damages is not recognized under Singapore law.’ Accordingly . . . the one satisfaction rule does not operate to extinguish the Plaintiff’s claim to RICO damages.” (UTHE Tech. Corp. v. Aetrium, Inc. (Ninth Cir.; December 11, 2015) 808 F.3d 755.) http://cdn.ca9.uscourts.gov/datastore/opinions/2015/12/11/13-16917.pdf

SCOTUS Says Federal Policy Favors Arbitration.

A California consumer brought a class action against a satellite television service for unjust enrichment, declaratory relief, false advertising and violation of the Consumer Legal Remedies Act. The consumer had signed an agreement waiving rights to bring class action claims, and the agreement further stated that if “the law of your state would find this agreement to dispense with class arbitration procedures unenforceable, then this entire Section 9 is unenforceable.” The defendant moved to dismiss or stay the class action and to compel arbitration. The trial court denied the petition to compel arbitration, the Court of Appeal affirmed, stating: “The class action waiver is unenforceable under California law, so the entire arbitration agreement is unenforceable.” The California Supreme Court denied review. Citing both Buckeye Check Cashing, Inc. v. Cardegna (2006) 546 U.S. 440 [126 S.Ct. 1204, 163 L.Ed.2d 1038, 19 Fla.L.WeeklyFed S. 94], and AT&T Mobility LLC v. Concepcion (2011) 563 U.S. 333 [131 S.Ct. 1740, 179 L.Ed.2d 742, 22 Fla.L.WeeklyFed.S. 957], the United States Supreme Court reversed the California Court of Appeal, stating that California’s interpretation of the phrase “law of your state” does not place arbitration contracts on equal footing with all other contracts, and for that reason, it does not give due regard to the federal policy favoring arbitration. (DIRECTV, Inc. v. Imburgia (U.S. Sup. Ct.; December 14, 2015) ___U.S.___ [136 S.Ct. 463, 193 L.Ed.2d 365, 25 Fla. L. Weekly Fed. S. 567].) http://www.supremecourt.gov/opinions/15pdf/14-462_2co3.pdf

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