Here is your November 2018 eNews from the Business Law Section (“BLS”):
The Business Law Section focused on “getting back to business” in this first month of the 2018-2019 Bar year. To help kick-start the year, the leaders of the BLS’ fifteen Standing Committees convened at the Sheraton Grand Hotel in Los Angeles during the weekend of October 20-21, 2018 for the Section’s annual Fall Leadership Retreat Officer Education Program.
Bringing the Chairs and Vice Chairs of the Standing Committees together for in-person meetings gave our BLS leadership the invaluable opportunity to discuss their goals for the upcoming year face-to-face—and brainstorm about how they can collaborate with their sister BLS Standing Committees, the other 16 Sections of the CLA, the California Young Lawyers Association, and other local and national bar associations to bring those goals to fruition. Special guests Heather Rosing, President of the CLA, and Jeremy Evans, CLA Secretary and member of CLA’s Marketing and Communications Committee, also took time out of their busy weekends to attend the BLS Fall Leadership Retreat to share their ideas about all the BLS can accomplish under the CLA through collaboration with strategic partners.
If the Fall Leadership Retreat is any indication of the innovation with which the BLS intends to approach its member services and constituency outreach for the next year, then you, Dear BLS Member, are in for a year of informative, interesting and diverse programs and events sure to benefit your business law practice, whether you are a new lawyer or a seasoned practitioner. In the space of only one month, the BLS is pleased to announce additional collaborative educational programming. Please read below to find out more.
The BLS’ innovation is in no way limited to its educational programming, however. I am pleased to report that, inspired by the BLS’ Insolvency Law Committee’s successful Bankruptcy Judicial Profile eBulletin series model, the Section’s Business Litigation Committee is beginning its own Judicial Profile eBulletin with upcoming interviews to be announced in the coming months.
Finally, recognizing that the business lawyers of tomorrow are the law students of today, on October 30, the BLS, in connection with Santa Clara University (SCU) Law School’s Law and Business Society and High Tech Institute, hosted a panel presentation on careers in business law attended by over sixty students—many of whom expressed interest in receiving the BLS’ Standing Committee’s eBulletin updates and otherwise becoming involved in the Section.
The BLS has had a busy first month of the new Bar year, working overtime to brainstorm how to provide the best programming, publications and outreach to its members. As Chair of the BLS, I am honored to share all of the ways that the BLS is working through its Standing Committees to collaborate with strategic partners to make your Section membership both valuable and worthwhile. And as Chair, I also invite you to be an active member of your BLS, so that we may all benefit from your contributions to the Section.
Monique D. Jewett-Brewster
Hopkins & Carley, A Law Corporation (San Jose)
Chair, Business Law Section
California Lawyers Association
On November 1, 2018, the Internet and Privacy Law Committee (IPLC) of the BLS, together with SCU Law School’s High Tech Law Institute and the International Association of Privacy Professionals, co-sponsored a panel on the California Consumer Privacy Act of 2018. The panel explored the law’s changes in privacy policies, contracts, and data handling practices statewide and nationally. The event was timely given the significant changes in the privacy law landscape and hosted an estimated 200-300 attendees. Panelists included California Consumer Privacy Association Chair Alastair Mactaggart, whose ballot initiative led to the passage of the 2018 law, as well as Microsoft’s Attorney Jasbir Kaur Khalsa, and SCU Law Professor Lydia F. de la Torre. Joshua de Larios-Heiman, Co-Chair of the BLS’ IPLC, moderated the panel. With thanks to SCU Law, those who are interested may view a link to a stream of the event here.
Offering 1.5 hours participatory MCLE credit, this webinar, set for November 6, 2018, 12 noon – 1:30 p.m., will cover procedures in state and federal courts for retention, discovery, and presentation of experts at trial and provide a methodology for maximizing the effective use of experts at trial. The webinar is presented by the BLS’ Business Litigation Committee, with panelists Peter L. Isola, BLS Co-Chair and partner at Hinshaw & Culbertson, and real estate attorney Harold A. Justman. Neil J. Wertlieb, BLS Co-Vice Chair, Berkeley lecturer and principal at Wertlieb Law Corp., will serve as moderator.
Registration is now open for a live 4-hour three-panel “Business Law Recent Developments” event set for November 15, from 10 a.m. – 2 p.m. at the University of San Francisco, co-hosted by the BLS’ Corporations Committee, Partnerships and Limited Liability Companies Committee, and IPLC. Panelists Roger Royse of Royse Law and Phil L. Jelsma, partner at CGS3, will discuss the Tax Cuts and Jobs Act and provide guidance on how to advise clients when choosing to form an entity. Panelist Robert Conca, partner at Jacko Law Group PC, will discuss recent developments in federal and California securities laws. Finally, panelist and IPLC Co-Chair Joshua de Larios-Heiman will provide an in-depth lecture on California’s Consumer Privacy Act of 2018. Registration information can be found here.
On November 15, the BLS is proud to co-sponsor the Ninth Judicial Circuit Historical Society’s “Women in the Law: Going First and Going Forward” panel program at the U.S. District Court in Los Angeles, from 5 – 7:30 p.m. Panelists include Chief Judge Virginia Philips of the U.S. District Court, Central District of California, and Nicole Duckett-Fricke, General Counsel and Vice President of the LA Clippers and the first woman of color to serve as the chief legal officer of a National Basketball Association franchise. Learn more and register here.
The BLS is comprised of 15 Standing Committees whose members review and propose legislation, draft eBulletins, BLN articles, and practice guides, and speak at live and webinar programs, all in order to provide value to their respective constituency lists. The Standing Committees meet between 5 and 10 times each year, usually by telephone. Committee members develop valuable personal and business relationships with other practitioners in their respective fields of practice.
To qualify for membership, a practitioner must be a member of the BLS and have practiced law at least five years. Each Committee is comprised of 16-30 members, selected for 3-4 year terms.
(Note: Existing members were automatically appointed to the same Committee for their remaining term under the CLA. Applications are only required for new members or for those whose terms expire in 2018.) Applications can be found here.
Please send the completed application to John Buelter, firstname.lastname@example.org.
An oft-repeated scenario in boundary disputes goes like this: A property owner encroaches upon a neighbor’s land and then uses that land in a manner that is akin to owning the land. It could be fencing off the neighbor’s land and then possessing that land as if it actually was the owner’s property. It could be building on, planting or otherwise using the neighbor’s land in a manner that dispossesses the neighbor from the land, or prevents the neighbor from using the land for any practical purpose, or even prevents the neighbor from determining how her land will be used. The encroacher’s usual next step is to allege that he is entitled to a court judgment either for a prescriptive easement or for adverse possession in order to maintain the encroachment or to maintain the use on the neighbor’s land. However, prescriptive easements are generally not available in that scenario because the use that the property owner seeks to make of the neighbor’s land is exclusive or “so comprehensive as to supply the equivalent of an estate.” (Raab v. Casper (1975) 51 Cal.Ap.3d 866, 876-877.)
Having failed to obtain a prescriptive easement, the property owner alternatively seeks an award of adverse possession, which would allow for such exclusive use and possessory interest. However, that alternative litigation tactic often fails because adverse possession requires the payment of property taxes that are “assessed upon the land for the period of five years during which the land has been occupied and claimed” (Code Civ. Proc. §325, subd. (b)), and because the property owner almost never pays such property taxes. Thus, the property owner invariably pursues yet another litigation strategy, an equitable easement.
The Court of Appeal of California recently issued several opinions that addressed the mindset of the encroaching property owner in order to determine whether that owner is entitled to an equitable easement. These opinions will be discussed in an eBulletin to be issued soon by the BLS’ Agribusiness Committee.
Courtesy of CEB, we are bringing you selected legal developments in areas of California business law that are covered by CEB’s publications. This month’s feature is from the September 2018 update to Privacy Compliance and Litigation in California. References are to the book’s section numbers. See CEB’s BLS Landing Page for special discounts for Business Law Section members. The most significant legal developments since the last update include developments in such important topic areas as the California Consumer Privacy Act, what constitutes protected “personally identifiable information,” disclosure of cybersecurity risks and incidents, medical privacy issues, insurance coverage, and more.
Privacy Compliance and Litigation in California
Selected Developments - September 2018
As of March 28, 2018, when Alabama enacted its own data breach notification law, all the states now have such laws. See §1.2.
California enacted the California Consumer Privacy Act of 2018 (CC §§1798.100–1798.198), operative January 1, 2020, to give customers of specified businesses in California expanded control over personal information that businesses collect about them and to expand the ability to bring lawsuits for data breach. See §§1.3, 4.11A, 12.6.
In a medical privacy case, the California Supreme Court held that the state's interest overcomes the privacy interests of patients for whom certain drugs were prescribed. Lewis v Superior Court (2017) 3 C5th 561. See §§1.3, 7.2.
The United States Supreme Court held that, generally speaking, someone in otherwise lawful possession and control of a rental car has a Fourth Amendment reasonable expectation of privacy in it even if the rental agreement did not list him or her as an authorized driver. Byrd v U.S. (May 14, 2018, No. 16–1371) 2018 US Lexis 2803. See §§1.3, 2.4A.
The U.S. Supreme Court held that the government's accessing of a defendant's cell-site location information was a search under the Fourth Amendment requiring a warrant supported by probable cause. Furthermore, an order under 18 USC §2703(d) is insufficient to obtain the location information from a wireless carrier. Carpenter v U.S. (June 22, 2018, No. 16–402) 2018 US Lexis 3844. See §§1.3, 2.4A, 4.43, 8.70.
The Clarifying Lawful Overseas Use of Data Act (CLOUD Act) was enacted on March 23, 2018, as part of the Consolidated Appropriations Act, 2018 (Pub L 115–141, 132 Stat 348). It amends the Stored Communications Act (SCA) (18 USC §§2701–2713) to establish processes and procedures for law enforcement requests for data in other countries. See §§1.4, 4.43, 12.52A.
An unanimous California Supreme Court held that the identity of various members of a statewide class did not constitute private information. Williams v Superior Court (2017) 3 C5th 531. See §§2.7, 12.116.
The Ninth Circuit Court of Appeals held that a unique IP address is not protected "personally identifiable information" under the Video Privacy Protection Act of 1988 (VPPA) (18 USC §2710). Eichenberger v ESPN (9th Cir 2017) 876 F3d 979. See §§4.9A, 12.6A.
In another Ninth Circuit case, the court rejected a challenge to a cy press settlement fund as invalid due to potential conflicts of interest resulting from connections between Google and some of the cy press fund recipients. Gaos v Holyoak (In re Google Referrer Header Privacy Litig.) (9th Cir 2017) 869 F3d 737, cert granted sub nom Frank v Gaos (Apr. 30, 2018) 2018 US Lexis 2658. See §4.9A.
The California Legislature amended provisions governing when a rental car company may use electronic surveillance technology to permit its use when a rental car company's vehicle is the subject of an AMBER Alert. Stats 2017, ch 163. See §4.11.
The U.S. District Court for the Northern District of California granted a motion for summary judgment and permanently enjoined the State of California from enforcing CC §1798.83.5 on the grounds that it violates the First Amendment. IMDb.com, Inc. v Becerra (ND Cal, Feb. 20, 2018, No. 16-cv-06535-VC) 2018 US Dist Lexis 27898. See §4.12.
The Ninth Circuit affirmed the conviction of a company IT manager under the Computer Fraud and Abuse Act (CFAA) (18 USC §1030) when he had taken several actions designed to damage the company's computer network, even though he argued on appeal that because he had authority over the network as part of his job he did not exceed his authority to access the system as required for a conviction under the CFAA. U.S. v Thomas (5th Cir 2017) 871 F3d 591. See §4.21.
In October 2017, the U.S. Department of Justice revised its policy regarding the use of so-called gag orders for subpoenas and search warrants issued pursuant to the Stored Communications Act (SCA) (18 USC §§2701–2713) to permit service providers to alert users when their data has been provided to the government. See §4.43.
The U.S. District Court for the Northern District of California dismissed a plaintiffs' cause of action under Bus & P C §17529.5 against a defendant who allegedly sent the plaintiff 1300 false or misleading commercial e-mails on the grounds that §17529.5 only prohibits advertisers (but not senders) from engaging in these practices and the sender of the e-mails involved did not advertise in the e-mails. Blanchard v Fluent, Inc. (ND Cal, Sept. 22, 2017, No. 17-CV-04497-MMC) 2017 US Dist Lexis 155535. See §5.52.
Regulations governing the federal Telephone Consumer Protection Act (TCPA) (47 USC §227), which are at 47 CFR §64.1200, were amended on January 12, 2018, to allow voice service providers to block certain calls. 83 Fed Reg 1577 (Jan. 12, 2018). See §5.55.
In February 2018, the SEC adopted "interpretive guidance" to assist public companies on disclosing cybersecurity risks and incidents. 83 Fed Reg 8166 (Feb. 26, 2018). See §6.2.
Allegations that the defendant published a consumer credit report that falsely stated the plaintiff's age, marital status, wealth, education level, and profession, which prevented plaintiff from finding employment, were sufficiently concrete to establish US Const art III standing. Robins v Spokeo, Inc. (9th Cir 2017) 867 F3d 1108 (Spokeo III). See §§6.29, 12.6A.
The Bureau of Real Estate has no mandatory duty to remove evidence of previous criminal convictions of a real estate salesperson from its website. See Skulason v California Bureau of Real Estate (2017) 14 CA5th 562. See §8.14.
To be an actionable offense, an employer illegally recording or eavesdropping on employee phone calls must be acting intentionally. Rojas v HSBC Card Servs. (2017) 20 CA5th 427. See §8.65.
The California Code of Regulations was amended to permit employees to perform job duties that correspond to their gender identity or gender expression. 2 Cal Code Regs 11031(e). See §8.84.
Effective January 1, 2018, the Immigrant Worker Protection Act imposes various prohibitions and requirements on private and public employers regarding employment eligibility verification forms and workplace inspections by immigration enforcement agents. A new section has been added in chap 8 discussing the Act. Stats 2017, ch 492. See §8.98A.
The Social Security Number Fraud Prevention Act of 2017 (Pub L 115–59, 131 Stat 1152) amends the Social Security Act to require federal agencies to issue regulations specifying when inclusion of a Social Security number on a document sent by mail is necessary. See §10.45A.
A federal district court in New York held that a plaintiff was entitled to insurance coverage for an e-mail–based "spoofing" fraud that resulted in the company transferring over $4.7 million to the spoofer. Medidata Solutions v Federal Ins. Co. (SDNY 2017) 268 F Supp 3d 471. See §10.104.
A violation of the Fair Credit Reporting Act (FCRA) (15 USC §§1681–1681x) gives rise to an injury sufficient for US Const art III standing even without evidence that the plaintiffs' information was used improperly. In re Horizon Healthcare Servs. Data Breach Litig. (3d Cir 2017) 846 F3d 625. However, although a plaintiff received a credit card receipt displaying the card's full expiration date, his mere allegation of violation of FCRA was insufficient to confer art III standing. Bassett v ABM Parking Servs., Inc. (9th Cir 2018) 883 F3d 776. See §12.6A.
Law enforcement training manuals need not be linked to enforcement of a more specific statute to be exempt from disclosure under the exemption of 5 USC §552 for materials compiled for law enforcement purposes. ACLU of N. Cal. v FBI (9th Cir 2017) 881 F3d 776. See §§12.34, 12.38.
The California Legislature amended CC §1708.85 to provide more protections throughout the proceedings for plaintiffs suing for relief from "revenge porn" and using pseudonyms to protect their identities from the public. Stats 2017, ch 233. See §12.61.
A California state court held that the psychotherapist-patient privilege does not prevent disclosure of a patient's records to the state. Cross v Superior Court (2017) 11 CA5th 305. See §12.84.
A California appellate court found that Yelp could be compelled to produce documents that might reveal the identity of a reviewer who posted on its website because the plaintiff had demonstrate a sufficient prima facie case of defamation. Yelp, Inc. v Superior Court (2017) 17 CA5th 1. See §12.108.
In an issue of first impression, the Sixth Circuit developed a test for whether and under what circumstances a court can properly protect the identity of an anonymous online speaker after entry of judgment against him or her. Signature Mgmt. Team, LLC v Does (6th Cir 2017) 876 F3d 831. See §12.108.
The State Bar of California is working with legal groups to coordinate pro bono opportunities in response to the fires around the state. The Bar needs help staffing a legal hotline and resource table at disaster recovery centers and providing assistance in pro bono cases. The Bar will provide online training and technical assistance. Further information can be found on The State Bar of California’s website.
If you know of other opportunities for pro bono help from BLS members, please contact Everett L. Green, Everett.L.Green@usdoj.gov.
The new and amended Rules of Professional Conduct for licensed attorneys in California took effect November 1, 2018. Click here to read more about the rules.
Do you regularly practice in the health care industry? Have you been practicing for at least 5 years? Are you interested in getting involved with a group of lawyers devoted to promoting quality and education in the practice of health care law? If so, we invite you to consider applying to be a member or advisor to the Health Law Committee.
The HLC is one of fifteen standing committees of the CLA BLS. The HLC is comprised of experienced attorneys as well as newer lawyers who have practiced at least five years. The HLC meets each month by phone or in person to discuss the many developments in these vibrant times for health law.
The HLC promotes scholarship, as well as the distribution of practical know-how. Committee members are afforded tremendous opportunities; they contribute to CEB practice guides, publish e-bulletins, e-news articles, and substantive articles that appear in the Business Law News, and have the opportunity to draft legislation, meet with legislators on health law issues, and be a resource to legislative analysts seeking comments on proposed legislation. HLC articles are reviewed by over 650 CLA members, including health care lawyers, judges, in-house and agency counsel. HLC publications have the potential for being tweeted and retweeted, reaching potentially thousands of readers. Committee members also have the opportunity to give and receive MCLEs and to hear experts each month on health law related topics. In addition, members contribute to community outreach programs, such as an upcoming community health fair currently being planned for the Spring of 2019.
This is an exciting and unique time to get involved. In this first year of the CLA, the HLC will have a number of openings. If you are a licensed attorney with at least 5 years of experience, go online here and submit an application, or contact either David Leatherberry at email@example.com or Emily Cook at firstname.lastname@example.org if you have any questions. Even if you are not ready to join the Committee, write to us with your ideas and with what you would like to hear about in the coming months.
The 15 BLS Standing Committees publish eBulletins announcing developments in their area of law and upcoming events open to BLS members. Click HERE to sign up to receive these eBulletins from any BLS Standing Committee completely free of charge.
Did you know that the BLS maintains a presence on LinkedIn, Twitter, and Facebook where BLS posts regular updates about new cases, new regulations, key legislative developments, and news and events from the BLS’s Standing Committees? What you may not know is that you can not only send items to the BLS to post or tweet, but also suggest items from your own social media pages for the BLS to re-post, re-tweet, or like. Doing so expands the reach of what you have to say to everyone who likes or follows the BLS on its various social media platforms, and may result in the BLS following you! Please submit your suggested items for consideration or direct any questions to BLS Social Media Coordinator, Dennis Wickham (email@example.com) and join the ever-expanding discussion!
Everett L. Green, Editor-in-Chief
Dennis Wickham, Contributing Editor
Corey R. Weber, Vice Chair of Publications and Contributing Editor
Monique D. Jewett-Brewster, BLS Chair and Contributing Editor