Litigation Update: December 2021

A monthly publication of the Litigation Section of the California Lawyers Association.

  • Senior Editor, Eileen C. Moore, Associate Justice, California Court of Appeal, Fourth District, Division Three
  • Managing Editor, Julia C. Shear Kushner
  • Editors, Dean Bochner, Jessica Riggin, David Williams, Ryan H. Wu, and Greg Wolff
Asylum Seeker’s Right to Counsel.

An asylum seeker who spoke no English “diligently pursued representation” and finally connected with a pro bono attorney at Catholic Charities who agreed to represent him. When the attorney was unavailable on the date of the asylum seeker’s merits hearing, the man requested a continuance. An immigration judge denied the request. The Ninth Circuit noted that this was not a case of a petitioner abusing the system or requesting serial delays and ruled that the immigration judge’s refusal to grant a continuance violated the man’s right to counsel. (Usubakunov v. Garland (9th Cir., Nov. 1, 2021) 16 F.4th 1299)

Noisy Neighbors.

The trial court granted a preliminary injunction for one neighbor against another because of noisy pool and air conditioning equipment installed very close to a common wall. The court ordered defendant to move the equipment to another part of defendant’s property that was not adjacent to the common wall. On appeal, the defendant argued the noise level was within the level permitted under the Los Angeles Municipal Code (LAMC). Affirming, the Court of Appeal stated: “Here the LAMC does not expressly immunize all equipment noise below the decibel level proscribed in section 112.02, subdivision (a), nor does it preclude nuisance liability for otherwise excessive or inappropriate equipment noise below that level that unreasonably interferes with the use and enjoyment of property.” (Chase v. Wizmann (Cal. App. 2nd Dist., Div. 2, Nov. 1, 2021) 71 Cal.App.5th 244.)

Evidence of Sexual Molestation Admissible for Impeachment.

Plaintiff sued defendant school district. She alleged that in 2010 and 2011, when she was in the fourth grade, a teacher molested her, resulting in emotional and psychological trauma. Plaintiff filed a motion in limine to exclude evidence of her “sexual history with persons other than” the teacher. However, the school district sought to use information obtained through discovery that plaintiff was “sexually molested” by a “teenage family friend” in 2013. The molestation inflicted “emotional and psychological trauma” upon plaintiff for the next several years, severe enough that she sought out medical and psychological treatment in 2016. The trial court admitted the 2013 evidence in part, reasoning that the evidence fell outside of the scope of Evidence Code §§ 783 (barring evidence of specific instances of plaintiff’s sexual conduct to prove consent or the absence of injury), and 1106 (giving court the power to control what evidence of plaintiff’s sexual conduct may be introduced and what questions asked when offered to attack plaintiff’s credibility). In its analysis, the Court of Appeal noted: “[W]e must decide whether a ‘plaintiff’s sexual conduct’ within the meaning of section 1106 includes sexual conduct that was inflicted upon the plaintiff involuntarily—that is, does it apply to sexual abuse? We hold that it does.” Accordingly, the appeals court rejected the school district’s argument that the 2013 evidence should have been admitted for all purposes. Nevertheless, the appeals court denied plaintiff’s writ petition, finding that the trial court did not abuse its discretion in deciding that the probative value outweighed the danger of undue prejudice when introduced as impeachment material. (Doe v. Superior Court (Cal. App. 2nd Dist., Div. 2, Oct. 29, 2021) 71 Cal.App.5th 227.)

General Negligence or Medical Malpractice.

Plaintiff’s husband took her to an emergency room after she swallowed 60 Naproxen tablets. Less than an hour later, plaintiff walked to the toilet with assistance. She walked back to her bed without assistance, and fell during that walk back, injuring herself. She filed a complaint against the hospital for general negligence more than a year later. The statute of limitations for general negligence is two years. (Code Civ. Proc., § 335.1.) The statute of limitations for medical malpractice is one year. (Code Civ. Proc., § 340.5.) The trial court granted summary judgment for the hospital. On appeal, plaintiff argued that the general negligence statute applied, because the hospital’s negligence did not involve the provision of medical services. Affirming, the Court of Appeal stated: “Here, the nursing staff’s judgment that appellant could use the restroom without their assistance was a judgment made in the course of providing medical care to her. Their duty to, for example, protect her from falling while walking in the emergency room was a duty owed to a patient, not a member of the general public. For this reason, we conclude the claim is one for professional negligence to which section 340.5 applies.” (Mitchell v. Los Robles Regional Medical Center (Cal. App. 2nd Dist., Div. 6, Nov. 2, 2021) 71 Cal.App.5th 291.)

The Issue in Legal Malpractice Cases Is Causation.

Two people retained lawyers to sue their insurance company. The case was resolved against them, so they sued their lawyers for malpractice. The trial court ruled against the two plaintiffs that action. Regarding legal malpractice cases generally, the Court of Appeal explained: “A case within a case can arise when a legal malpractice suit accuses lawyers of poor work. The main case is the malpractice suit: were the defendant lawyers’ performances deficient? The case within the case is whether the lawyers’ performances mattered. If the underlying suit on which the lawyers worked lacked merit, then their alleged malpractice could not have had an impact, because the client would have lost anyway. The issue is causation: whether possible malpractice could have caused harm.” Specifically, regarding the instant legal malpractice action, the appeals court affirmed, finding the plaintiffs’ underlying case against their insurance company “was a lost cause from the start.” (Letgolts v. David H. Pierce & Associates, PC (Cal. App. 2nd Dist., Div. 8, Nov. 2, 2021) 71 Cal.App.5th 272.)

Farm Laborer’s Agreement to Arbitrate Dispute Upheld.

Plaintiff, a farm laborer, sued his former employer and others for violations of federal and California labor and wage laws. Defendants moved to compel arbitration based on a signed arbitration agreement. All parties agreed defendants never expressly told plaintiff that he had to sign the agreement to keep working for the company. However, plaintiff had already traveled from Mexico, was situated in company housing, and had started work by the time he was presented with the agreement. The district court refused to enforce the agreement, holding that plaintiff signed it under economic duress and undue influence. Reversing, the Ninth Circuit found that, since plaintiff had not been informed he would be fired if he refused to sign the agreement, the circumstances did not rise to the level of economic duress or undue influence. (Martinez-Gonzalez v. Elkhorn Packing Co. LLC (9th Cir., Nov. 3, 2021) 17 F.4th 875.)

Hospital Loses in Action Against Health Care Service Plan.

Under federal and state law, a hospital is required to provide “necessary stabilizing treatment” for any person in an “emergency medical condition.” (42 U.S.C. § 1395dd(b); Health & Saf. Code, § 1317, subd. (a).) The amount of reimbursement depends upon whether the hospital and plan already have a contract in place. If the hospital and the plan have no contract, as happened here, the plan must pay the reasonable and customary value of the services rendered. Here, the plan paid the hospital an amount the hospital considered inadequate, so the hospital sued the plan. A jury found that the plan had paid the hospital the reasonable and customary value of its services. The Court of Appeal held: (1) A hospital cannot sue for the tort of intentionally paying an amount that is less than the “reasonable and customary value” of the emergency medical services, and thereby obtain punitive damages; (2) A hospital cannot sue for injunctive relief under California’s unfair competition law (Bus. & Prof. Code, § 17200) to enjoin the plan from paying too little reimbursement for possible future claims not covered by a contract; and (3) The trial court did not err by instructing the jury that the “reasonable value” of emergency medical services is defined as “the price that a hypothetical willing buyer would pay a hypothetical willing seller for the services, [when] neither [is] under compulsion to buy or sell, and both hav[e] full knowledge of all pertinent facts.” (Long Beach Memorial Medical Center v. Kaiser Foundation Health Plan, Inc. (Cal. App. 2nd Dist., Div. 2, Nov. 4, 2021) 71 Cal.App.5th 323.)

Private Company Is Not Entitled to Immunity.

WhatsApp Inc. and Facebook, Inc. filed suit against a privately owned and operated Israeli company, alleging that the Israeli company inserted malware into plaintiffs’ servers. The Israeli company moved to dismiss, arguing the Foreign Sovereign Immunity Act (28 U.S.C. § 97), protected it from being sued. The Ninth Circuit held that a private company is not entitled to immunity under the Foreign Sovereign Immunity Act. (WhatsApp Inc. v. NSO Group Technologies Limited (9th Cir., Nov. 8, 2021) 17 F.4th 930.)

No Service, No Default.

A landlord had a default judgment entered against a former tenant for breach of contract. The former tenant moved to set aside the default pursuant to Code of Civil Procedure §§ 473(d) and 473.5, arguing she had never been served with the summons and complaint. The trial court denied the former tenant’s motions. Reversing, the Court of Appeal concluded the landlord’s attempts at service were not diligent. The appeals court noted that in the first attempt, the process server tried to serve the former tenant with unlawful detainer proceedings, not the pleadings for the instant breach of contract action. The second attempt took place at an address the landlord knew the former tenant had already vacated. (Kremerman v. White (Cal. App. 2nd Dist., Div. 8, Nov. 8, 2021) 71 Cal.App.5th 358.)

Police Officers’ Defamation Action to Continue in Trial Court.

Plaintiffs, who are police officers, shot and killed a Black man while attempting to make an arrest. Defendant, who is a Seattle City Council member, told a crowd a few days later: “The brutal murder of Che Taylor, just a blatant murder at the hands of the police, show[s] how urgently we need to keep building our movement for basic human rights for black people and brown people.” Plaintiffs sued defendant for defamation. The district court dismissed the action on the ground that plaintiffs failed to allege that defendant’s remarks were “of and concerning” them. Reversing, the Ninth Circuit explained: “Under the governing federal pleading standard, Plaintiffs plausibly have alleged that [defendant’s] communications were of and concerning them. First, [defendant’s] own words suggest that her remarks were directed not only at the police generally, but also at the individual officers involved in the shooting. She told the crowd that the shooting constituted ‘a blatant murder at the hands of the police,’ and she called for the Seattle Police Department to be held accountable ‘for their . . . individual actions.’ . . . Second, the complaint plausibly alleges that some of those who read or heard [defendant’s] remarks—Plaintiffs’ families, friends, and colleagues, as well as members of the general public—knew that Plaintiffs were the officers involved in the shooting. . . . Third, the complaint plausibly alleges that these readers and listeners understood that [defendant’s] remarks were directed at Plaintiffs.” (Miller v. Sawant (9th Cir., Nov. 10, 2021) 18 F.4th 328.)

Breach of Contract, Without More, Is Not Wrongful Conduct Capable of Supporting a Tort.

Two beverage distribution companies entered into a nondisclosure and noncircumvention agreement. After a falling out, one sued the other for intentional interference with a prospective economic advantage premised solely on the theory that the other had engaged in independently wrongful conduct by breaching the agreement. A jury returned a verdict for plaintiff. Reversing, the Court of Appeal stated: “This is an invalid theory as a matter of law because, as our Supreme Court has said time and again, an actor’s breach of contract, without more, is not ‘wrongful conduct’ capable of supporting a tort . . . , including the tort of intentional interference with a prospective economic advantage . . . . Unfortunately, no one—not the plaintiff, not the defendant, not the trial court—caught this error until the defendant moved for judgment notwithstanding the verdict after the jury returned a special verdict in the plaintiff’s favor that was premised solely on the breach of the agreement. [¶] We hold that where the jury’s special verdict for the plaintiff is based on conduct that does not constitute an actionable tort, that verdict cannot stand. That is because, just as a trial court lacks subject matter jurisdiction to enter judgment for conduct that does not violate a criminal or civil statute . . . , a trial court also lacks subject matter jurisdiction to enter judgment for allegedly tortious conduct, fashioned by common law, that our Supreme Court has determined is not tortious.” (Drink Tank Ventures LLC v. Real Soda in Real Bottles, Ltd. (Cal. App. 2nd Dist., Div. 2, Nov. 10, 2021) 71 Cal.App.5th 528.)

Big Risks for Injured Plaintiffs and Lawyers Representing Them, Especially When There’s a Lien.

Plaintiff was injured in an automobile  collision and sued defendant, and then . . .

  • Defendant offered to settle for $200,000 under Code of Civil Procedure § 998;
  • Plaintiff rejected the offer;
  • The parties stipulated there was a workers’ compensation lien of $256,631.76;
  • The jury returned a verdict for $115,000;
  • Plaintiff moved for a new trial, arguing two jurors discussed during deliberations their prior experience and knowledge regarding the workers’ compensation system;
  • In analyzing the new trial motion, the trial court noted that the jury apparently conflated the workers’ compensation lien with insurance;
  • The trial court denied the new trial motion;
  • The trial court also denied plaintiff’s motion to tax defendants’ costs under § 998, which totaled $174,830.29.

Finding no error, the Court of Appeal affirmed. (Oakes v. Progressive Transportation Services, Inc. (Cal. App. 2nd Dist., Div. 2, Nov. 10, 2021) 71 Cal.App.5th 486.)

“An Obvious Defect in the Condition of an Alley Is Not the Same as for a Sidewalk.”

Plaintiff, wearing flip-flops, was walking across an alley carrying a paper plate piled with pastries. The front of her flip-flop hit the edge of a drainage channel, called a swale. The asphalt that is normally flush with the swale had been worn away since 2014, creating a divot that was 1.75 inches deep. Plaintiff suffered injury and sued the city. The trial court granted summary judgment for the city. Affirming, the Court of Appeal stated: “Because alleys, unlike sidewalks, are designed and primarily used for purposes other than walking, and because the cost to municipalities of inspecting alleys with the same vigilance as inspecting sidewalks would be astronomical relative to the benefit of doing so, we hold that what is an obvious defect in the condition of an alley is not the same as for a sidewalk. Because reasonable minds can reach only one conclusion—namely, that the less-than-two-inch deep divot in the asphalt abutting a drainage vein in the alley is not an obvious defect—we affirm the trial court’s grant of summary judgment in this case.” (Martinez v. City of Beverly Hills (Cal. App. 2nd Dist., Div. 2, Nov. 10, 2021) 71 Cal.App.5th 508.)

Surfer’s Neck Is Broken When Lifeguard’s Watercraft Was Suddenly Turned.

According to plaintiff, he was on his surfboard surfing when a city lifeguard made an abrupt turn of a watercraft in front of him. To avoid a collision, plaintiff dove off his surfboard, hit the ocean floor, and fractured his neck. The trial court granted summary judgment for the city on plaintiff’s negligence cause of action, determining that Government Code § 831.7 precludes imposition of liability on a public entity for injuries that arise out of hazardous recreational activities. Plaintiff thereafter amended his complaint to try to come under two statutory exceptions to § 831.7: (1) that the lifeguard’s conduct was grossly negligent and the “proximate cause of the injury” and (2) the city failed to guard or warn of a known dangerous condition. The case proceeded to trial, and a jury ultimately found for defendants. On appeal, plaintiff challenged the trial court’s summary judgment ruling. Specifically, plaintiff contended that the trial court wrongly concluded that the immunity granted to public entities and their employees under § 831.7 barred plaintiff from pursuing a cause of action for ordinary negligence. Plaintiff also contended that the trial court wrongly concluded, prior to instructing the jury, that the city and its lifeguards were not required to comply with the state’s basic speed law set forth in Harbors and Navigation Code § 655.2. The Court of Appeal found that the trial court correctly concluded that § 831.7 provided defendants with complete immunity with respect to the plaintiffs’ ordinary negligence claim. However, the appeals court also concluded that the trial court wrongly concluded that Harbors and Navigation Code § 655.2’s five-mile-per-hour speed limit did not apply to city lifeguards. Accordingly, it reversed and remanded the judgment, stating: “[W]e concluded that it is reasonably probable that a result more favorable to the plaintiffs would have occurred if the trial court had instructed the jury with an accurate statement of the state’s vessel speed law’s application to [the lifeguard].” (Haytasingh v. City of San Diego (Cal. App. 4th Dist., Div. 1, Nov. 10, 2021.) 2021 WL 5235563.)

Family Court Asleep at the Domestic Violence Switch.

A family court awarded joint custody to the parents of two children in a dissolution action, despite evidence the mother had obtained a domestic violence restraining order against the father. The filed a petition for writ of mandate. She contended the lower court erred for two reasons: First, Family Code § 3044, subdivision (a) establishes a rebuttable presumption that it is not in a child’s best interest to award joint or sole legal or physical custody to a parent who a court has found to have committed domestic violence against the other parent within the previous five years, and § 3044, subdivision (b) requires the family court to make specific findings if the court concludes the presumption has been overcome. Here, the family court made no such findings. Second, § 3044, subdivision (h) requires the court to inform the party who has alleged the other party has perpetrated domestic violence of the existence of § 3044. Here, the family court failed to do so. Issuing a writ of mandate, the Court of Appeal directed the lower court to vacate its order and reconsider custody based on the presumption. (Noble v. Superior Court of Merced County (Cal. App. 5th Dist., Nov. 10, 2021) 2021 WL 5279407.)

Disparate Treatment Claim Tossed.

The federal Fair Housing Act (FHA) empowers courts to invalidate only artificial, arbitrary, and unnecessary barriers to housing. Pinal County, Arizona acknowledged its responsibility to pay its public housing tenants’ delinquent water bills but consistently refused to do so, contending it was immune to that policy based on the county’s status as a public municipality. After years of failed tactics and fruitless negotiations with the county, the water district imposed a new policy that increased the refundable security deposit required of new public housing customers to $180 before the district would agree to provide water services. New non-public housing customers were subject only to a $55 deposit. Here, plaintiffs, who are public housing residents, sued the district under the FHA (42 U.S.C. §§ 3604 and 3617), alleging the water district’s deposit policy amounted to discrimination. The district court granted summary judgment for the district. Affirming, the Ninth Circuit stated: “Because the Appellants did not establish a genuine issue of material fact as to whether the District had a discriminatory motive, we affirm the district court’s order granting the District summary judgment on the disparate treatment claim.” (Southwest Fair Housing Council, Inc. v. Maricopa Domestic Water Improvement District (9th Cir., Nov. 12, 2021) 17 F.4th 950.)

Arbitration Denied Where Arbitration Clause Was Written on a Credit Card Agreement Mailed to Card Holder.

Defendant’s petition to compel arbitration of a debt collection dispute was denied by the trial court. Defendant is the current creditor and purchased the debt from the original creditor. Defendant contended the original creditor sent a credit card account agreement, with an arbitration clause, when plaintiff opened the account and again when plaintiff received a replacement card a few years later. The agreement allowed plaintiff to reject the arbitration clause by written notice within 60 days, but the original creditor received no such notice. Based on these and other facts, defendant argued that plaintiff agreed to the arbitration clause, submitting a declaration from one of its employees stating she found no record of plaintiff’s objection to arbitration or its return as undeliverable. Affirming denial of petition to compel arbitration, the Court of Appeal stated: “[T]he contents of those records were hearsay, and [defendant] has not shown the trial court abused its discretion by finding the business record exception did not apply.” (Chambers v. Crown Asset Management, LLC (Cal. App. 4th Dist., Div. 1, Nov. 12, 2021) 2021 WL 5279409.)

No Insurance for Lost Business During Pandemic.

This appeal presents an issue of first impression for a California appellate court: Does a commercial property insurance policy provide coverage for a business’s lost income due to the COVID-19 pandemic? Plaintiff owns and operates five lodging facilities. Defendant insurance company issued a policy to plaintiff which has this provision: “We will pay for the actual loss of Business Income you sustain due to the necessary ‘suspension’ of your ‘operations’ during the ‘period of restoration’. The ‘suspension’ must be caused by direct physical loss of or damage to property at [Inns’] premises . . . . The loss or damage must be caused by or result from a Covered Cause of Loss.” Defendant denied plaintiff’s claim for loss of business during the pandemic and plaintiff sued. The trial court sustained defendant’s demurrer without leave to amend. The Court of Appeal stated: “Here, there is no dispute that certain requirements of the Business Income coverage are satisfied. Specifically, Inns suspended its operations, which led to a loss of business income. However, the issue we must resolve is whether the suspension of operations was ‘caused by direct physical loss of or damage to property at [Inns’] premises.’ ” The appeals court affirmed, concluding: “[U]nder the specific insurance policy . . . Inns cannot recover from California Mutual for its lost business income resulting from the COVID-19 pandemic.” (The Inns by the Sea v. California Mutual Insurance Company (Cal. App. 4th Dist., Div. 1, Nov. 15, 2021) 2021 WL 5298480.)


A high school boy with Tourette’s Syndrome, sensory integration disorder, and borderline autism spectrum disorder was routinely bullied by several other students. They called him a “faggot” or “fag,” and said such things as “God hates fags.” They pushed him into walls and threw things at him. The boy reported the bullying to high school administrators, telling them he couldn’t take it anymore. He then died by suicide. The boy’s parents sued the Chino Valley Unified School District and its principal and assistant principal. They alleged defendant were liable for their son’s suicide because of their inadequate response to his complaints of bullying by his classmates. The trial court granted summary judgment for defendants and plaintiffs appealed. Relying on Education Code § 44808, the Court of Appeal affirmed, concluding the school district and the administrators were statutorily immune from liability. (LeRoy v. Yarboi (Cal. App. 4th Dist., Div. 2, Oct. 27, 2021) 2021 WL 5323329.)

Conditional Counterclaim in Federal Court.

Under 28 U.S.C. § 2201, the district court has discretion to decline jurisdiction over a declaratory-relief claim. However, when a declaratory claim is joined with an “independent” monetary one, the district court, in most cases, must retain jurisdiction over the entire action. Here, plaintiff sued defendant for declaratory relief. In response, defendant filed an answer asking the district court to decline jurisdiction. Defendant also counterclaimed for declaratory and monetary relief, but only if the district court first exercised jurisdiction over plaintiff’s claim. The district court declined to exercise jurisdiction over plaintiff’s claims and dismissed the action. Affirming, the Ninth Circuit stated: “Because parties can plead a conditional counterclaim and still preserve objections to jurisdiction, we hold that such conditionally pled counterclaims, without more, do not trigger mandatory jurisdiction over declaratory claims. And because the district court properly exercised its discretion in deciding to dismiss, we affirm.” (Argonaut Insurance Company v. St. Francis Medical Center, (9th Cir., Nov. 16, 2021) 17 F.4th 1276.)

Commercial Speech Not Subject to Anti-SLAPP Statute.

Both plaintiff and defendant are pharmaceutical companies developing their own respective means to administer a certain drug. According to plaintiff, defendant engaged in a campaign to try to derail plaintiff’s application for the Food and Drug Administration’s approval of its method. Plaintiff sued defendant, alleging various torts and statutory violations. Defendant moved to strike under the Anti-SLAPP statute (Code Civ. Proc., § 425.16). The superior court granted in part and denied in part. The Court of Appeal affirmed in part and reversed in part, stating: “We agree that at least some of the conduct giving rise to the defamation action is covered by the commercial speech exception (§ 425.17, subd. (c)) and not subject to the anti-SLAPP statute. . . . We will remand this matter back to the superior court with instructions to enter an order striking the allegations relating to Aquestive’s petitioning activity, striking the malicious prosecution action, and denying the motion as to the UCL and defamation causes of action to the extent they are based on unprotected conduct.” (Neuresis, Inc. v. Aquestive Therapeutics, Inc. (Cal. App. 4th Dist., Div. 1, Nov. 17, 2021) 2021 WL 5355958.)

Male’s Claim of Hostile Work Environment Remanded to the Trial Court.

Plaintiff is a manicurist at a salon in the Wynn Hotel in Las Vegas. He complained to management that female manicurists received most of the appointments. Once, in March 2017, plaintiff became frustrated and threw a pencil at a computer because customers were requesting female manicurists more often than male manicurists. Plaintiff alleged that a manager at the salon disciplined him for throwing the pencil and commented that he might want to do something else for work. According to plaintiff, the manager remarked that plaintiff was working in a “female job related environment” and suggested that he look for other employment in the culinary field. Another time, a female coworker told plaintiff and another male manicurist that if they wanted to get more clients, they should wear wigs to look like women. Plaintiff alleged that his coworkers made similar comments to him on other occasions, and his male coworkers agreed that they were subjected to similar remarks. Plaintiff also alleged a male customer requested he come to his room and give him a massage to his private parts, and that plaintiff went to manager and said he no longer felt comfortable interacting with that customer. He was directed to finish the pedicure on the customer, and he complied, although he felt very uncomfortable while doing so. A female coworker told plaintiff he should not be upset about the incident and should instead take it as a compliment. When plaintiff responded that he was not happy with that remark, another female coworker allegedly said, “shut up Vincent, you know you want sex from [the customer], you keep mentioning it.” Plaintiff filed suit against the hotel. His complaint included claims pursuant to Title VII, 42 U.S.C. § 2000e et seq., for sex discrimination, retaliation, and hostile work environment. The hotel moved for summary judgment, and the district court dismissed plaintiff’s claims and entered final judgment in defendant’s favor. Reversing, the Ninth Circuit stated: “[Plaintiff] failed to establish that his manager’s suggestion that he work in another industry and his coworker’s suggestion that he should wear a wig created a hostile work environment. But a reasonable factfinder could conclude that the manager’s response to [plaintiff’s] report of a customer’s overt sexual proposition subjected [plaintiff] to a hostile work environment. We therefore reverse the district court’s order granting summary judgment in favor of Wynn on [plaintiff’s] hostile work environment claim. On remand, the district court shall reconsider the cumulative effect of the related comments by [plaintiff’s] coworkers that he should take the customer’s sexual proposition as a compliment or that he welcomed it.” (Fried v. Wynn Las Vegas, LLC (9th Cir., Nov. 18, 2021) 2021 WL 5408678.)

Proposition 8, Redux. Proponents of Prop 8 Don’t Want the Trial Videos Released.

2008—California voters passed Proposition 8 (“Prop 8”), amending the California Constitution to provide that only a marriage between a man and a woman is valid.

2009—Two same-sex couples filed suit in Northern California, challenging Prop 8 on constitutional grounds.

  • Prior to trial, the district judge discussed the possibility of livestreaming the trial, but a local court rule prevented it.
  • The Ninth Circuit Judicial Council authorized a pilot program permitting the use of video in nonjury civil trials.
  • The Northern District of California changed its local rule to participate in the pilot program.

2010—Proponents of Prop 8 challenged the rule change in a writ of mandamus proceeding. It was denied.

  • On the morning of the first day of trial, the U.S. Supreme Court issued a temporary stay of the proposed broadcast to other courthouses.
  • The district judge permitted video recording of the trial, but it was not broadcast outside the courthouse. That was permitted for the first two days of trial, while the court awaited to see if the U.S. Supreme Court would lift the stay. 
  • The U.S. Supreme Court extended the stay. Proponents asked that the trial no longer be recorded. The district judge ordered the recording would continue because it would be helpful to the court in preparing findings of fact, but told the parties the recording was “not going to be for purposes of public broadcasting or televising.”

2011—After the district judge retired, the then-Chief Judge ordered the video recordings unsealed. For the few years, litigation over release of the video recordings continued.

2015—In Obergefell v. Hodges, 576 U.S. 644 (2015), the U.S. Supreme Court held that same-sex marriage is protected under the Fourteenth Amendment.

2017—There was a media request for release of the recordings. A new judge was assigned.

2018—The district court held that the reliance interest identified in 2012 remained a compelling reason to maintain the recording’s seal until its presumptive expiration after ten years, pursuant to the court’s local rules.

2020—Ten years was up. The district court ordered the video recordings released.

  • Proponents of Prop 8 asked the district court to extend the seal, which it declined to do.

2021—That brings us to today’s ruling by the Ninth Circuit: “Appellants are a subset of the original proponents of ballot Proposition 8. We conclude that Appellants have failed to demonstrate sufficient injury for Article III standing. We therefore dismiss their appeal for lack of jurisdiction.” (Perry v. Newsom, (9th Cir., Nov. 18, 2021) 18 F.4th 622.)

“We are not in Kansas anymore,” Court of Appeal.

Plaintiff invested in a project with the idea of turning old tires into fuel through pyrolysis. The project failed and plaintiff brought suit. A Kansas jury returned a $3.825 million fraud judgment for plaintiff and against defendant. The superior court found that a certain company was defendant’s alter ego, and modified the judgment to add that company as a judgment debtor. On appeal, the Court of Appeal discussed the fact that the individual defendant’s wife owns 50 percent of the company found to be the alter ego. Thus, the appeals court held: “We agree with respondent that the evidence is sufficient to support the trial court’s finding that BKS Cambria is Schaefers’ alter ego. But we reverse and remand for further proceedings so that the trial court may weigh competing equities that bear on the veil-piercing issue. Respondent is entitled to recover the damages awarded by the Kansas judgment, but wife may be an innocent third party who would suffer substantial harm if respondent’s recovery is accomplished through the reverse veil piercing of BKS Cambria. Wife has a 50 percent ownership interest in the LLC, but there is no indication that she was involved in the fraud committed against respondent by Schaefers. . . . And she may not be responsible for debts incurred by him after their separation in 1996. [Citation.] On remand, ‘the court should weigh the competing equities and grant or deny relief depending on the balance of those equities.’ (Kapner v. Meadowlark Ranch Assn. (2004) 116 Cal.App.4th 1182, 1190.)” (Blizzard Energy, Inc. v. Schaefers (Cal. App. 2nd Dist., Div. 6, Nov. 18, 2021) 2021 WL 5366815.)

Nurse Who Was Terminated Did Not Show Evidence of Pretext, so Summary Judgment for Hospital Upheld.

Defendant hospital terminated employment of plaintiff, a registered nurse, after discovering she had violated the hospital’s policies governing the handling and documentation of patient medications. That nurse sued the hospital alleging her discharge constituted wrongful termination in violation of public policy, disability discrimination, retaliation, and a violation of the Fair Employment and Housing Act (Gov. Code, § 12900 et seq.; FEHA), and other statutory violations. The superior court granted summary judgment for the hospital. Affirming, the Court of Appeal stated: “We have independently reviewed the record, including the evidence proffered by the parties, and agree with the trial court that it is devoid of evidence of pretext. As all of [plaintiff]’s claims depended on there being a triable issue of fact regarding the lawfulness of her discharge, and our record does not show such a triable issue of fact exists, summary judgment was properly granted.” (Wilkin v. Community Hospital of the Monterey Peninsula (Cal. App. 4th Dist., Div. 3, Nov. 18, 2021) 2021 WL 5371427.)

If Suit Against a Tribe Employee Would Only Impose Personal Liability on the Sued Employee, There Is No Sovereign Immunity.

Following a contract dispute, a casino owned by the Blue Lake Rancheria tribe unsuccessfully sued plaintiff in tribal court. After dismissal of the tribal case, plaintiff filed his own suit in state court against two casino officials, the casino’s attorneys, a tribal court judge, the tribal court clerk, and various other individuals and entities. Seeking monetary relief, he alleged, among other things, that the parties he sued had wrongfully conspired to file the tribal court lawsuit. The trial court found defendants enjoyed sovereign immunity. The Court of Appeal reversed in part, holding that the individual defendants who would be personally bound by a judgment were not entitled to sovereign immunity. The appeals court explained: “[B]ecause neither the Tribe nor the Casino would be bound by any potential adverse judgment in this case, we decline to find sovereign immunity applicable.” (Acres v. Marston (Cal. App. 3rd Dist., Nov. 18, 2021) 2021 WL 5369794.)

Disabled Child Must Exhaust the IDEA Process Before Bringing ADA Action.

Plaintiff is an elementary school student who has an emotional disability that interferes with his ability to learn. He sued the school district alleging he was being denied a free appropriate public education. He claimed that the school district failed to provide a one-to-one behavioral aide and related supportive services. The parties settled their dispute after mediation. After settlement, he filed a complaint in district court, alleging that the school district had violated the Americans with Disabilities Act (ADA), by failing to provide the services he had previously sought. The district court dismissed the complaint without prejudice for failure to exhaust the IDEA process. (Individuals with Disabilities Education Act, Pub.L. 101-476, 20 U.S.C. §§ 1400 et seq.) Affirming, the Ninth Circuit stated: “It is common ground that D.D. can sue the District under the ADA for not providing reasonable accommodations. It is also common ground that the same omissions or actions can give rise to claims both under the IDEA and the ADA. But the Supreme Court has instructed us that if the gravamen of D.D.’s complaint is the school’s failure to provide a FAPE [free appropriate public education], he must first exhaust the IDEA process before seeking ADA relief. The only disputed issue is whether the gravamen of this complaint is the failure to offer a FAPE. Because it is, we affirm.” (D.D. v. Los Angeles Unified School District (9th Cir., Nov. 19, 2021) 2021 WL 5407763.)

Supreme Court Applies Equitable Apportionment Doctrine Over Water Rights to Underground Aquifer.

Hundreds of feet beneath Memphis lies one of the city’s most valuable resources: The Middle Claiborne Aquifer. The Middle Claiborne Aquifer underlies other States too, including Mississippi. Mississippi filed an original action in the U.S. Supreme Court alleging that Tennessee’s pumping from the aquifier has taken hundreds of billions of gallons of water that were once located beneath Mississippi and has altered the historic flow of groundwater within the Middle Claiborne Aquifer. It sought at least $615 million in damages, as well as declaratory and injunctive relief. A special master recommended that the U.S. Supreme Court dismiss Mississippi’s action and grant leave to amend its complaint to seek equitable apportionment. The U.S. Supreme Court held that the doctrine of equitable apportionment, which it previously had applied to interstate rivers and streams, applies as well to underground aquifiers. It declined to decide whether Mississippi should be granted leave to amend its complaint to seek equitable apportionment because it had never sought to do so. The high court dismissed the action, finding Mississippi had failed to show that it was entitled to relief. (State of Mississippi v. Tennessee (U.S., Nov. 22, 2021) 2021 WL 5434188.)

Terminating Sanctions Reversed.

The trial court imposed terminating sanctions under Code of Civil Procedure § 128.7 in a real property dispute action, finding the operative complaint was legally frivolous because no reasonable attorney could conclude it was timely filed. The Court of Appeal noted that more than a threat to one’s title is required to commence the running of the limitations period against an owner in possession, and that the trial court’s order was not supported by substantial evidence. The appeals court reversed, stating the trial court “transgressed the confines of section 128.7 and its order of dismissal and imposition of monetary sanctions were an abuse of discretion.” (Kumar v. Ramsey (Cal. App. 3rd Dist., Nov. 29, 2021) 2021 WL 5563051.)

Just Because Plaintiff Defeats an MSJ Does Not Mean Defeat of a Costs of Proof Award for Denying RFAs.

Plaintiffs denied requests for admissions propounded by defendant. A jury returned a defense verdict. Defendant moved for attorney fees and costs of proof pursuant to Code of Civil Procedure § 2033.420, arguing plaintiffs had no reasonable basis to deny the RFAs. The trial court awarded defendant $239,170.86 in attorney fees and costs of proof. On appeal, plaintiff argued the costs of proof award was error because the trial court had previously denied defendant’s motion for summary judgment. The Court of Appeal was not persuaded, stating: “In ruling on a summary judgment motion, a trial court must liberally construe the evidence presented in opposition to the motion and resolve any doubts about the evidence in favor of the party opposing the motion.” The appeals court noted that the focus of a trial court’s determination under § 2033.420, subdivision (b), is whether the party making the denial held a reasonably entertained good faith belief that the party would prevail on the issue at trial. The appeals court affirmed the award of costs of proof, stating: “The trial court concluded plaintiffs did not have reasonable grounds to believe they would prevail at trial on their claims arising out of the alleged oral agreement. (§ 2033.420, subd. (b)(3).) The court did not abuse its discretion in so concluding.” (Spahn v. Richards (Cal. App. 1st Dist., Div. 3, Nov. 30, 2021) 2021 WL 5576615.)

Once Party Opposing Arbitration Submits Evidence There Was No Agreement to Arbitrate, the Burden of Proving an Agreement Remains With the Moving Party.

In a wrongful termination action, defendant employer moved to compel arbitration. Plaintiff employee produced evidence challenging the authenticity of the arbitration agreement submitted by defendant. The trial court denied arbitration, stating: “In sum, once Gamboa produced evidence challenging the authenticity of the purported arbitration agreement, the Clinic was required to rebut the challenge by establishing by a preponderance of the evidence that the agreement was valid. The Clinic did not have to authenticate Gamboa’s signature on the arbitration agreement. The Clinic could have met its burden in other ways, including a declaration from the Clinic’s custodian of records. But proferring no admissible evidence was insufficient.” (Gamboa v. Northeast Community Clinic (Cal. App. 2nd Dist, Div. 7, Nov. 30, 2021) 2021 WL 5575536.)

Duty of School District Vis-à-vis Sexual Abuse of Students.

A 26-year-old music teacher sexually assaulted a 13-year-old student. The student sued the school district for negligence and for breach of the mandatory duty to report suspected abuse under the Child Abuse and Neglect Reporting Act (Pen. Code, § 11164 et seq.; CANRA). The trial court granted summary judgment for the district. Reversing and remanding, the Court of Appeal stated: “We conclude, consistent with California negligence law, that school administrators have a duty to protect students from sexual abuse by school employees, even if the school does not have actual knowledge of a particular employee’s history of committing, or propensity to commit, such abuse. Therefore, we reverse the trial court’s order granting summary adjudication on Doe’s negligence causes of action. But we also conclude, as a matter of first impression, that a plaintiff bringing a cause of action for breach of the mandatory duty to report suspected abuse under CANRA must prove it was objectively reasonable for a mandated reporter to suspect abuse based on the facts the reporter actually knew, not based on facts the reporter reasonably should have discovered. Because Doe did not create a triable issue of material fact regarding whether any of the District’s employees knew of facts from which a reasonable person in a like position could suspect abuse, we affirm the trial court’s order granting summary adjudication on Doe’s CANRA cause of action.” (Doe v. Lawndale Elementary School District (Cal. App. 2nd Dist., Div. 7, Nov. 30, 2021) 2021 WL 5578329.)

What Trial Judge Must Do in Assessing Fairness of PAGA Settlement.

Two different plaintiffs (Moniz and Correa) brought actions against the same employer. The actions alleged Labor Code violations and were brought under the Private Attorneys General Act of 2004. (Lab. Code, § 2698 et seq.; PAGA.) Moniz’s action settled. In the other action, Correa objected to the settlement for several reasons. Reversing, the Court of Appeal stated: “We find that the trial court applied an appropriate standard of review by inquiring whether the settlement was ‘fair, adequate, and reasonable’ as well as meaningful and consistent with the purposes of PAGA, and we reject many of Correa’s contentions regarding the settlement’s purported substantive and procedural deficiencies. Nonetheless, we reverse the judgment because we cannot infer from the record that the trial court assessed the fairness of the settlement’s allocation of civil penalties between the affected aggrieved employees or whether such allocation comports with PAGA.” (Moniz v. Adecco USA, Inc. (Cal. App. 1st Dist., Div. 4, Nov. 30, 2021) 2021 WL 5578298.)

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