Litigation
Litigation Update: February 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, Reuben Ginsburg, Jessica Riggin, David Williams, Ryan H. Wu, and Greg Wolff.
Defendant Employer Waived Its Right to Arbitrate.
Defendant, a beverage distributor, was sued for wage and hour violations in a putative class action. While defendant was aware of its right to arbitrate at the outset of litigation, it waited more than two years to file a motion to compel arbitration:
Chronology
- 11/11/16 — complaint for wage & hour claims filed;
- 01/31/17 — amended class action complaint filed;
- 03/07/17 — parties stipulated to transfer venue;
- 03/15/17 — defendant filed answer stating claims subject to arbitration;
- 06/23/17 — action stayed to facilitate case management;
- 11/02/17 — defendant told court it did not intend to request arbitration at that time, but reserved its right to do so at a later time;
- 11/09/17 — the parties agreed to classwide mediation;
- 02/20/18 — the parties agreed to a protective order concerning documents;
- 03/15/18 — defendant told court it did not intend to request arbitration at that time, but reserved its right to do so at a later time;
- 03/21/18 — the parties told court the case did not settle, and the court lifted stay;
- 03/22/18 — plaintiffs propounded classwide discovery;
- 04/24/18 — plaintiffs propounded additional classwide discovery;
- 06/29/18 — defendant demanded arbitration in a letter to plaintiff;
- 08/14/18 — court ordered defendant to produce certain materials;
- 08/30/18 — defendant contacted court to reserve a hearing date for motion to compel arbitration;
- 11/20/18 — defendant filed motion to compel arbitration;
- 03/19/19 — trial court denied defendant’s motion to compel arbitration, finding defendant failed to demonstrate actions consistent with the right to arbitrate.
The trial court denied the motion to compel. Affirming, the Court of Appeal found that “[s]ubstantial evidence supported the trial court’s finding that defendant’s delay impaired plaintiffs’ ability to realize the benefits and efficiencies of arbitration.” (Garcia v. Haralambos Beverage Co. (Cal. App. 2nd Dist., Div. 5, Jan. 4, 2021) 59 Cal.App.5th 534.)
Court Erred in Converting a Hearing on a Demurrer into an Evidentiary Procedure.
The trial court sustained defendant’s demurrer and dismissed the action. The court reached its conclusion based on a judicially noticed transcription of relevant proceedings. At the same time, the court disallowed plaintiffs from presenting evidence regarding the meaning of the judicially noticed material. Reversing, the Court of Appeal held that “a court cannot by means of judicial notice convert a demurrer into an incomplete evidentiary hearing in which the demurring party can present documentary evidence and the opposing party is bound by what that evidence appears to show.” (New Livable California v. Association of Bay Area Governments (Cal. App. 1st Dist., Div. 3, Jan. 6, 2021) 59 Cal.App.5th 709.)
Summary Judgment Reversed Because It Was Granted on the Basis of an Issue Not Presented in the Moving Papers.
Plaintiff was struck by a vehicle while waiting for roadside assistance in his disabled car on the shoulder of a freeway. He sued the Automobile Club and a tow truck company for negligence. However, following his discovery admission that defendants did not cause “the Incident,” defendants moved for summary judgment on causation. The trial court assumed, without deciding, that plaintiff could amend his discovery responses to state the delay in responding to his call was a substantial factor in causing his injuries. Nevertheless, the court granted summary judgment, holding as a matter of law that no special relationship existed between the Automobile Club and plaintiff, so the Automobile club had no duty under tort law to provide any assistance. On appeal, plaintiff argued that the question of a special relationship had not been presented in the moving papers. Reversing, the Court of Appeal agreed that summary judgment could not be granted on the basis of an issue not presented in the moving papers. However, because plaintiff did not address the tow truck defendant on appeal, the judgment in its favor was affirmed. (Luebke v. Automobile Club of Southern California (Cal. App. 2nd Dist., Div. 7, Jan. 6, 2021) 59 Cal.App.5th 694.)
Thin Line Between Political Speech and Reckless Falsehoods.
Plaintiffs sued for defamation and false light invasion of privacy after defendants allegedly made false statements in mainstream media and online publications during a political campaign. Defendants filed anti-SLAPP motions pursuant to Code of Civil Procedure § 425.16. The trial court denied the motions. One plaintiff appealed, arguing that his publications were political opinions about a conflict of interest and not actionable. Affirming in part and reversing in part, the Court of Appeal stated: “Although political speech is appropriately accorded wide latitude, especially in election campaigns, calculated or reckless falsehoods can still amount to defamation even in that context.” The trial court, therefore, properly denied the anti-SLAPP motion as to the defamation claim. However, because the statements were not defamatory per se, the court should have granted the anti-SLAPP motion as to the false light claim. (Balla v. Hall (Cal. App. 4th Dist., Div. 1, Jan. 6, 2021) 59 Cal.App.5th 652.)
Eviction of a Commercial Tenant.
A landlord sought to evict a commercial tenant and filed an unlawful detainer action pursuant to Code of Civil Procedure § 1161, subdivision (3). On the eve of trial, the trial court granted judgment on the pleadings, finding the three-day notice was defective because it had been served by a prior owner of the property and did not identify to whom the tenant could turn over possession. Reversing, the Court of Appeal held that a property owner may file an action for unlawful detainer based on a three-day notice served by a predecessor in interest. The court also found that “nothing in section 1161 requires a notice to contain any specific information as to how a tenant can restore possession of the property to the owner.” (Lee v. Kotyluk (Cal. App. 4th Dist., Div. 3, Jan. 7, 2021) 59 Cal.App.5th 719.)
Uniform Voidable Transactions Act.
Defendants failed to disclose a problem with water intrusion in a $4.1 million home when they sold it to plaintiff. However, when it became evident that the arbitrator would likely find in plaintiffs’ favor, defendants used the bulk of their assets to buy another expensive home in Texas, which had an unlimited homestead liability exemption. Plaintiffs were consequently unable to collect on their arbitration award and filed an action under the Uniform Voidable Transactions Act (Civ. Code, § 3439 et seq.; UVTA). The trial court dismissed the UVTA action because plaintiffs could not identify a third-party transferee — by purchasing a new home, defendants had transferred the assets to themselves. Reversing in part, the Court of Appeal held that transferring an asset to oneself qualifies as a transfer under the UVTA. However, a common law claim for fraudulent transfer was not briefed on appeal, so the Court of Appeal declined to consider that claim and affirmed its dismissal. (Nagel v. Westen (Cal. App. 2nd Dist., Div. 6, Jan. 7, 2021) 59 Cal.App.5th 740.)
The Coastal Commission Means What It Says.
A house built in 1952 sat on the sand and had a seawall that was retroactively approved by the California Coastal Commission in 2005. Seawalls are frowned upon because they reduce the amount of dry sand in front of them, which in turn reduces public access to the beach. In 2015, the Commission allowed for reinforcement of the seawall subject to various conditions, one of which was that the seawall had to be removed if the residence was “redeveloped in a manner that constitutes new development.” Without notifying the Commission, the homeowners removed interior walls, plumbing, wiring, railings, and stairs, and added new and taller joists and structural steel that significantly increased the load-bearing strength of the deck roof, resulting in “a house that is much stronger than a typical house that was built in the 1950s.” The new development added decades to the useful life of the home, meaning the seawall would be present for many more years into the future than it would have without the renovations. The Commission ordered the seawall removed. The Court of Appeal affirmed the Commission’s cease and desist order as well as the $1,000,000 penalty it imposed. (11 Lagunita, LLC v. California Coastal Commission (Cal. App. 4th Dist., Div. 3, Dec. 4, 2020) 58 Cal.App.5th 904.)
Attorney Fees for Outside Counsel of Public Entity.
After a receivership action was resolved, the court awarded the city prevailing party attorney fees under Health and Safety Code § 17980.7. The losing plaintiff appealed, contending his constitutional rights were violated because the city was represented by private counsel that had an inappropriate financial interest in the litigation because the law firm could decide how much time to work and bill on the matter. Affirming, the Court of Appeal found the trial court properly determined the city was the prevailing party, that plaintiff’s constitutional rights were not violated, and that the law firm did not have a financial interest in the action. (City of Norco v. Mugar (Cal. App. 4th Dist., Div. 2, Dec. 11, 2020) 59 Cal.App.5th 786.)
Summary Judgment Reversed Because There Is a Triable Issue of Fact When the Injury Was Discovered.
Plaintiff contended defendants negligently failed to diagnose a brain tumor when he underwent an MRI in 2010. The trial court granted summary judgment to defendants based on the statute of limitations. Reversing, the Court of Appeal stated that “the undisputed facts do not establish that [plaintiff] was on notice of his injury and should have discovered it and its negligent cause, through the exercise of reasonable diligence, more than a year before he filed his complaint.” (Filosa v. Alagappan (Cal. App. 1st Dist., Div. 4, Dec. 21, 2020) 59 Cal.App.5th 772.)
Omitted Asset in Marriage Dissolution Settlement Agreement.
Wife and husband entered into a settlement agreement, in the form of a verbal stipulation, regarding the terms of their marital dissolution. The stipulation included an equal division of the community property portion of wife’s retirement plan without any mention of the plan’s survivor benefits. Thereafter, the parties could not agree as to whether husband had survivor benefits under wife’s retirement plan and they asked the court to resolve their dispute. In the alternative, wife asked the court to vacate the stipulation. The trial court found the survivor benefits were an “omitted asset” under Family Code § 2556, subject to an equal division under Family Code § 2610(a)(2). Affirming, the Court of Appeal stated: “Here, the clear language of the stipulation — that the parties ‘[would] be equally dividing the community property portion of the Wife’s FERS retirement’ — does not manifest an intent or agreement that husband would not receive a survivor benefit. Rather, the language shows an intent and agreement that the equal division of the community retirement plan would include all plan benefits, there being no specific exclusion for any survivor benefit.” (In re Marriage of Erndt and Terhorst (Cal. App. 1st Dist., Div. 3, Jan. 11, 2021) 2021 WL 82243.)
Forum Non Conveniens.
Plaintiffs live in the People’s Republic of China. Defendants reside in California. Plaintiffs allege that the principal defendant was attacked in China after criticizing a Chinese doctor. After the attack, defendant established a foundation to protect individuals in scientific and academic fields. Plaintiffs contributed the equivalent of $872,000 to defendants’ foundation. Plaintiffs allege misuse of the foundation’s funds, specifically that defendants used foundation money to buy an $850,000 home in California and made other expensive personal purchases. The trial court granted defendants’ motion for dismissal due to forum non conveniens. Affirming in part and reversing in part, the Court of Appeal concluded “substantial evidence support[ed] the court’s finding that China is a suitable forum. However, [the appellate court] agree[d] with plaintiffs that in the interest of justice, the case should be stayed and not dismissed, with the court to retain jurisdiction over the matter pending the outcome of the case in China.”
(Wang v. Fang (Cal. App. 4th Dist., Div. 1, Jan. 11, 2021.) 2021 WL 81658.)
Fired for Making Statement on Facebook.
A Las Vegas SWAT sniper, plaintiff commented on Facebook that it was a “shame” that a suspect who had shot a police officer did not have any “holes” in him. After the police department dismissed him from the SWAT team, plaintiff sued, alleging violation of his First Amendment rights. He contended that his comment suggested only that the police officer should have fired defensive shots. The district court, however, construed the statement as advocating unlawful violence, and ruled that the government’s interest in employee discipline outweighed plaintiff’s First Amendment rights. The district court granted summary judgment for the government. Reversing, the Ninth Circuit found there was a factual dispute about the objective meaning of plaintiff’s comment, stating: “[W]as it a hyperbolic political statement lamenting police officers being struck down in the line of duty — or a call for unlawful violence against suspects? Another factual dispute exists over whether Moser’s comment would have likely caused disruption in the police department.” (Moser v. Las Vegas Metropolitan Police Department (9th Cir., Jan. 12, 2021) 984 F.3d 900.)
http://cdn.ca9.uscourts.gov/datastore/opinions/2021/01/12/19-16511.pdf
Structure/Function Claim for Dietary Supplements.
Plaintiff took a vitamin called biotin to combat hair loss, but the vitamin was ineffective. Plaintiff subsequently brought a class action for deceptive labeling against defendants in the chain of distribution. The U.S. Food and Drug Administration (FDA) does not require pre-approval of labels for dietary supplements, but it does insist that the label’s statements be truthful and not misleading. The FDA also allows product labels to feature so-called “structure/function” claims that describe the effect of a nutrient or ingredient on the structure or function of the human body. For example, a vitamin can tout that “calcium supports strong bones” because scientific evidence supports that claim, even if higher doses of calcium do not benefit everyone. Here, the label on the biotin product stated that it “helps support healthy hair and skin.” Plaintiff agreed that biotin can promote hair and skin health, but argued that the statement was still misleading because most people obtain enough biotin from their regular diets and therefore do not benefit from higher doses of biotin. The federal district court granted summary judgment for defendants, concluding that plaintiff’s state law claims were preempted by federal law, which allows structure/function claims on product labels. Affirming, the Ninth Circuit concluded that defendants’ structure/function claim satisfied FDA requirements. (Greenberg v. Target Corporation (9th Cir., Jan. 13, 2021) 985 F.3d 650.)
https://cdn.ca9.uscourts.gov/datastore/opinions/2021/01/13/19-16699.pdf
Death of Inmate in County Jail.
Decedent died of a methamphetamine overdose at the San Diego Central Jail after medical staff left him unmonitored for eight hours, despite signs that he was under the influence of drugs, and then failed to promptly summon paramedics when they discovered him unresponsive and having a seizure. Decedent’s wife and successor-in-interest filed a lawsuit under 42 U.S.C. § 1983 against the county and three nurses, alleging that they violated decedent’s Fourteenth Amendment right to adequate medical care in custody. The district court granted summary judgment for defendants, concluding there were no triable issues of fact as to liability and that the nurses were entitled to qualified immunity. After the district court issued its decision, the Ninth Circuit clarified in Gordon v. County of Orange (2018) 888 F.3d 1118, 1124–1125, that an objective standard applies to constitutional claims of inadequate medical care brought by pretrial detainees. Applying that standard here, the Ninth Circuit reversed on the ground that genuine disputes of material fact precluded summary judgment. (Sandoval v. County of San Diego (9th Cir., Jan. 13, 2021) 985 F.3d 657.)
https://cdn.ca9.uscourts.gov/datastore/opinions/2021/01/13/18-55289.pdf
Previously we reported:
“Never go to a doctor whose office plants have died,” Erma Bombeck.
Surgical staff left a sponge in a patient during back surgery, and the patient had to endure a second surgery and treatment with powerful intravenous antibiotics. An administrative law judge issued a proposed decision finding no basis to fine the hospital because it had adequate policies and procedures to guard against such mistakes. The California Department of Public Health rejected the ALJ’s proposal and fined the hospital $50,000. The department’s decision was “effective immediately” and, 15 days later, the hospital filed an unsuccessful motion for reconsideration. The hospital then petitioned the superior court for a writ of mandate, and the court sustained the department’s demurrer without leave to amend because the department’s decision “was effective immediately and was thus not subject to a Request for Reconsideration.” Affirming, the Court of Appeal noted that Government Code § 11523 requires a writ petition challenging an agency’s decision to be filed within 30 days after the last day on which reconsideration can be ordered, and “where, as here, reconsideration is unavailable,” § 11523 means 30 days from the date of the agency’s decision. The appellate court also found the trial court correctly determined that the doctrines of equitable tolling and equitable estoppel did not apply. (Saint Francis Memorial Hospital v. California Department of Public Health (Cal. App. 1st Dist., Div. 1, June 15, 2018) 24 Cal.App.5th 617.)
The latest:
The California Supreme Court granted review on the issue of whether equitable tolling applies to a petition for a writ of administrative mandate. The high court concluded that equitable tolling does apply and remanded the case to the Court of Appeal with instructions “to determine whether the third element of equitable tolling [i.e., reasonable and good faith conduct by the party seeking tolling] is satisfied.” On remand, the Department conceded that Saint Francis Memorial Hospital acted in good faith, meaning that the only question was whether Saint Francis’s actions were objectively reasonable. The Court of Appeal concluded “they were not, because it is not objectively reasonable for an attorney to miss a deadline to file a petition due to a failure to appreciate easily ascertainable legal principles. Thus, although we sympathize with Saint Francis’s counsel and recognize it is easy to make such mistakes, we must again affirm the trial court’s judgment.” (Saint Francis Memorial Hospital v. State Department of Public Health (Cal. App. 1st Dist., Div. 1, Jan. 13, 2021) 2021 WL 115994.)
Retaining Possession of Debtor’s Property Does Not Violate Automatic Bankruptcy Stay.
A city impounded respondents’ vehicles after respondents failed to pay fines for motor vehicle infractions. Each respondent filed a Chapter 13 bankruptcy petition and requested that the city return his or her vehicle on the ground that the Bankruptcy Code imposes an automatic stay on efforts to collect pre-petition debts outside the bankruptcy forum. A bankruptcy court held that the city’s refusal to return the vehicles violated the automatic stay, and the Seventh Circuit affirmed. Vacating the judgment of the appellate court, the U.S. Supreme Court held that the mere retention of property does not violate 11 U.S.C. § 362(a)(3) and explained that “the filing of a bankruptcy petition operates as a ‘stay’ of ‘any act’ to ‘exercise control’ over the property of the estate. Taken together, the most natural reading of these terms—‘stay,’ ‘act,’ and ‘exercise control’—is that §362(a)(3) prohibits affirmative acts that would disturb the status quo of estate property as of the time when the bankruptcy petition was filed.” (Chicago v. Fulton (U.S., Jan. 14, 2021) 141 S.Ct. 585.)
Claimed Retaliation by ICE.
Plaintiff was detained by Immigration and Customs Enforcement (ICE) and released on bond. The following year, he spoke at a rally and read a poem he wrote entitled “Dear America,” in which he criticized ICE enforcement and detention practices. Fewer than 36 hours later, ICE revoked his bond and re-arrested him. He petitioned to the district court, which denied his petition. In Nieves v. Bartlett (2019) 139 S. Ct. 1715, the U.S. Supreme Court held that the presence of probable cause generally defeats a retaliatory criminal arrest claim under 42 U.S.C. § 1983. In Mount Healthy City Board of Education v. Doyle (1977) 429 U.S. 274, the Court held that once a petitioner has made a showing of retaliation, the burden shifts to the government to show that it would have taken the same action even in the absence of the protected conduct. Reversing the district court’s denial of his petition, the Ninth Circuit stated: “Because Nieves does not control, we remand to the district court to apply the Mt. Healthy standard, the default rule for First Amendment retaliation claims.” (Bello-Reyes v. Gaynor (9th Cir., Jan. 14, 2021) 985 F.3d 696.)
https://cdn.ca9.uscourts.gov/datastore/opinions/2021/01/14/19-16441.pdf
Previously we reported:
The BIG Question.
This case, concerning franchisees who in turn are franchisors to unit franchisees, dates back more than a decade. Employer versus independent contractor issues abound in it. While this case was pending, the California Supreme Court issued its opinion in Dynamex Operations West Inc. v. Superior Court (2018) 4 Cal.5th 903. Dynamex held that a hiring entity must overcome the ABC test by establishing three elements to disprove employment status: (A) the worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact; (B) the worker performs work that is outside the usual course of the hiring entity’s business; and (C) the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed. The Ninth Circuit certified the following question to the California Supreme Court: “Does Dynamex Operations West Inc. v. Superior Court, 416 P.3d 1 (Cal. 2018), apply retroactively?” (Vazquez v. Jan-Pro Franchising International, Inc. (9th Cir., Sept. 24, 2019) 2019 U.S. App. LEXIS 28814.)
The latest:
The California Supreme Court concluded “that the standard set forth in Dynamex applies retroactively — that is, to all cases not yet final as of the date our decision in Dynamex became final.” In reaching this conclusion, the Court relied “primarily on the fact that Dynamex addressed an issue of first impression. It did not change a settled rule on which the parties below had relied.” (Vazquez v. Jan-Pro Franchising International, Inc. (Cal., Jan. 14, 2021) 939 F.3d 1045.)
Plaintiff May Bring Civil Rights Action After Prosecutor Introduced His Un-Mirandized Confession.
Plaintiff, a native of Cameroon, transported patients to the MRI section of a hospital. When a patient accused plaintiff of sexual assault, the police were called. A deputy sheriff took plaintiff into a room. According to plaintiff,he refused to confess after 35 to 40 minutes of questioning. The deputy then falsely said that the assault had been captured on video so plaintiff might as well admit to it, but plaintiff still did not confess and asked for a lawyer. When the deputy ignored his request, plaintiff tried to leave the room. At this point, the deputy stepped on his toes, put his hand on his gun, called plaintiff the N-word, and said, “I’m about to put your black ass where it belongs, about to hand you over to deportation services, and you and your entire family will be rounded up and sent back to the jungle . . . . Trust me, I have the power to do it.” Plaintiff then confessed. According to the deputy,when he arrived, he asked plaintiff what had happened with the patient, and plaintiff said, “I made a mistake.” After they entered the MRI reading room, the deputy handed plaintiff a sheet of paper and said, “Can you write what happened while I get my sergeant and we can ask you a couple of questions[?]” The deputy claimed that plaintiff then wrote the confession without further prompting. During the criminal trial, the prosecution introduced plaintiff’s written confession as evidence of his guilt. The jury returned a verdict of not guilty. After his acquittal, plaintiff filed this action under 42 U.S.C. § 1983 seeking damages for alleged violations of his constitutional rights, contending that his right against self-incrimination was violated. The first jury found in favor of the deputy, but the district court ordered a new trial based on instructional error. The second jury also found in favor of the deputy. On appeal, plaintiff argued that the second jury was also erroneously instructed. Reversing and remanding for a third trial, the Ninth Circuit explained that “the jury must be properly instructed that the introduction of a defendant’s un-Mirandized statement at his criminal trial during the prosecution’s case in chief is alone sufficient to establish a Fifth Amendment violation and give rise to a § 1983 claim for damages.” (Tekoh v. County of Los Angeles (9th Cir., Jan. 15, 2021) 985 F.3d 713.)
https://cdn.ca9.uscourts.gov/datastore/opinions/2021/01/15/18-56414.pdf
State Meal and Rest Breaks Regulation Preempted.
The Federal Motor Carrier Safety Administration (FMCSA), an agency within the Department of Transportation, issues regulations on commercial motor vehicle safety and has authority to determine whether state laws on commercial motor vehicle safety are preempted. The FMCSA determined that federal law preempts California’s meal and rest break rules, known as the “MRB rules,” as applied to drivers of property carrying commercial motor vehicles who are subject to the FMCSA’s own rest break regulations. California’s Labor Commissioner, certain labor organizations, and others petitioned for review of the FMCSA’s preemption determination. Denying the petition, the Ninth Circuit stated: “Because the agency’s decision reflects a permissible interpretation of the Motor Carrier Safety Act of 1984 and is not arbitrary or capricious, we deny the petitions for review.” (International Brotherhood of Teamsters, Local 2785 v. Federal Motor Carrier Safety Administration (9th Cir., Jan. 15, 2021) 2021 WL 139728.)
https://cdn.ca9.uscourts.gov/datastore/opinions/2021/01/15/18-73488.pdf
What Is a Work Week?
The Family and Medical Leave Act of 1993 (29 U.S.C. § 2601(a)(1); FMLA) grants eligible employees “a total of 12 workweeks of leave during any 12-month period” to attend to qualifying family and medical needs. At issue is what the term “workweeks” means as applied to employees who work a rotational schedule of seven days on followed by seven days off. The Ninth Circuit held: “When an employee working a ‘one week on, one week off’ schedule takes continuous leave, an employer may count both the on and off weeks against the employee’s FMLA leave entitlement.” (Scalia v. Department of Transportation and Public Facilities (9th Cir., Jan. 15, 2021) 985 F.3d 742.)
https://cdn.ca9.uscourts.gov/datastore/opinions/2021/01/15/19-35824.pdf
Alleged Excessive Use of Force.
A speeding vehicle did not stop when a CHP officer activated his overhead lights. Instead, the vehicle took an offramp and immediately entered the highway again, and then took another offramp. The driver then lost control and crashed into a fence. To the officer, it appeared as if the driver was attempting to activate the vehicle again, and so he approached the vehicle with his gun drawn. At the window of the vehicle, the officer ordered the driver out of the car, with his gun pointed at the driver. In response, the driver stopped rocking the car and reached toward the front passenger seat or floorboard. Apparently fearing that the driver was reaching for a weapon, the officer fired two shots, hitting the driver’s spine, leaving him paralyzed from the chest down. No gun was found, and the driver died several months later from unrelated causes. His family brought a civil rights action under 42 U.S.C. § 1983, contending the officer used excessive force. The district court denied the officer’s motion for summary judgment, concluding there was sufficient evidence to create a genuine dispute whether the officer’s use of force was reasonable. Dismissing the appeal, the Ninth Circuit stated: “Because Marsh’s interlocutory appeal challenges only the district court’s conclusion that there is sufficient evidence to create a genuine dispute as to the factual question that will determine whether Marsh’s use of force was reasonable, we lack jurisdiction to review his arguments.” (Estate of Anderson v. Marsh (9th Cir., Jan. 15, 2021) 985 F.3d 726.)
https://cdn.ca9.uscourts.gov/datastore/opinions/2021/01/15/19-15068.pdf
Negligent Misrepresentation and Intent to Induce Reliance.
Plaintiff filed an action against a doctor and a medical center, alleging that she sought treatment from defendants for a “droopy eyelid and brow.” According to plaintiff, the doctor said he could perform a “brow lift” to correct the problem. But since a brow lift would not be covered by plaintiff’s insurance, according to the doctor, he offered to perform a blepharoplasty, which would be covered by plaintiff’s insurance. Plaintiff alleged this statement was false and the doctor had no reasonable basis for making the statement. After undergoing a blepharoplasty, she claimed that she continued to have physical difficulties with her eyelid and brow. Plaintiff consulted another doctor who advised her that the first doctor had performed the wrong procedure and should have performed a brow lift instead. Plaintiff alleged causes of action for professional negligence, lack of informed consent, fraud and deceit, and battery. The trial court granted defendants’ motion for summary adjudication on the fraud and deceit and battery causes of action. The jury found for defendants on professional negligence and lack of informed consent. Plaintiff appealed, challenging the summary adjudication of her fraud and deceit cause of action. The Court of Appeal concluded the fraud and deceit cause of action encompassed both intentional and negligent misrepresentation, intent to induce reliance for purposes of negligent misrepresentation does not require an intent to defraud, and there was a triable issue of fact on the issue of intent to induce reliance. (Borman v. Brown (Cal. App. 4th Dist., Div. 1, Jan. 15, 2021) 2021 WL 140844.)
Sibling-to-Sibling Sale Does Not Qualify for Reassessment Exclusion.
One beneficiary of a family trust purchased his siblings’ interests in real property owned by the trust after their parents’ death. The county determined that there was a change in ownership, denied the buyer’s claim for reassessment exclusion, and later denied the buyer’s application for changed assessment. The buyer then sued the county for a tax refund. The trial court found for the county. Affirming, the Court of Appeal stated: “This constituted a sibling-to-sibling sale rather than a sale or transfer from parent to child. The fact that [plaintiff] received title from the trustee does not negate the earlier transfer of the equitable interest in the property to the thirteen children.” (Bohnett v. County of Santa Barbara (Cal. App. 2nd Dist., Div. 6, Jan. 19, 2021) 2021 WL 164173.)
$30 Million Non-Economic Damage Award Reversed Due to Prop. 51 Error and Improper Final Argument.
Plaintiffs’ daughter was killed when she crashed her car into defendant truck driver’s parked tractor-trailer while avoiding a driver who had made an illegal U-turn. The Court of Appeal reversed the non-economic damage award for two reasons:
1) Proposition 51
The trial court precluded the truck driver from offering evidence of fault of three former defendants in the case who had settled because he had claimed in response to contention interrogatories that the U-turn driver was the sole cause of the accident. The jury was instructed to consider only the comparative fault of the U-turn driver and the truck driver. The appellate court stated: “Here, the jury was not permitted to consider the comparative fault of defendants who settled before trial. Reversal is required for this reason alone.”
2) Misconduct of plaintiffs’ counsel
During final argument, plaintiffs’ counsel told the jury:
- That defendants’ counsel is “ ‘not being straight with you’ ”;
- This is “ ‘not the time to make up lies and to try to cheat your way to justice’ ”;
- That the truck driver and his counsel spent the last five years “ ‘actively evading responsibility. And not just actively evading it, but [by] lying.’ ”;
- “ ‘I called them lies in the beginning, but . . . they have blown into even bigger things because it is a fraud’ ”;
- “ ‘[J]ust imagine that is your daughter,’ ” and imagine “ ‘that constant love and connection between you and your daughter,’ and that ‘your daughter is taken away’ ”; and
- “ ‘You can’t stone him to death’ but you can ‘make him pay.’ ”
The appellate court stated: “This was misconduct and it denied appellants a fair trial.” (Plascencia v. Deese (Cal. App. 2nd Dist., Div. 6, Jan. 20, 2021) 2021 WL 193844.)
Alleged False Advertising by Supposedly Independent Product Reviewer.
Defendant self-publishes a book that compares and reviews nutritional supplements sold in the direct marketing industry; it has become a trusted name among industry sales representatives. Defendant portrays itself as an independent company that relies on scientific criteria to mathematically calculate the ratings and presents only objective data in its publication. Plaintiff sued defendant for false advertising under the Lanham Act (15 U.S.C. § 1051 et seq.), contending defendant rigged its ratings under a hidden financial arrangement to favor plaintiff’s competitor. Dismissing the action, the district court concluded the Lanham Act does not apply to consumer product reviews and defendant’s publication is not commercial speech. Reversing, the Ninth Circuit found plaintiff plausibly alleged the publication contains misrepresentations and remanded the matter for the district court to determine the “purpose of influencing” element under the Lanham Act. (Ariix, LLC v. NutriSearch Corporation (9th Cir., Jan. 22, 2021) 2021 WL 221878.)
https://cdn.ca9.uscourts.gov/datastore/opinions/2021/01/22/19-55343.pdf
Request to Serve via Social Media Rejected.
Feeling threatened by a homeless man, plaintiff obtained a temporary restraining order but was unable to serve the homeless person she wanted restrained and moved the court for permission to serve him by social media, citing out-of-state authority. The trial court denied the motion and dismissed the action without prejudice. Affirming, the Court of Appeal stated: “We encourage the Legislature and the Judicial Council, which have already authorized extensive use of electronic service of notice (see Code Civ. Proc., § 1010.6; Cal. Rules of Court, rule 2.251; see also Prob. Code, § 1215, subd. (c)), to consider developing pilot programs to test the efficacy of utilizing new technologies as an approved method of service of process. But as the superior court properly ruled in this case, current law requires personal service of the petition, TRO and notice of hearing in civil harassment restraining order cases and does not permit the court to approve alternative methods of service.” (Searles v. Archangel (Cal. App. 2nd Dist., Div. 7, Jan. 22, 2021) 2021 WL 221956.)
Tweet No More: Twitter May Permanently Suspend Account.
When plaintiff posted several messages critical of transgender women on Twitter, the company took down her posts and informed her she had violated its hateful conduct rules. After she posted additional similar messages, Twitter permanently suspended her account. Plaintiff alleged causes of action for breach of contract, promissory estoppel, and violation of the unfair competition law. The trial court sustained Twitter’s demurrer to the complaint without leave to amend, concluding plaintiff’s suit was barred by the Communications Decency Act of 1996 (47 U.S.C. § 230; CDA). Affirming, the Court of Appeal stated: “Under section 230, interactive computer service providers have broad immunity from liability for traditional editorial functions undertaken by publishers—such as decisions whether to publish, withdraw, postpone or alter content created by third parties. Because each of [plaintiff’s] causes of action seek to hold Twitter liable for its editorial decisions to block content she and others created from appearing on its platform, we conclude [plaintiff’s] suit is barred by the broad immunity conferred by the CDA.” (Murphy v. Twitter, Inc. (Cal. App. 1st Dist., Div. 1, Jan. 22, 2021) 2021 WL 221489.)
ADA Suit Dismissed for Failure to State a Claim.
Plaintiff, a quadriplegic who uses a wheelchair for mobility, visited a Tesla dealership and later filed a complaint that alleged he encountered inaccessible service counters that denied him full and equal access to the Tesla dealership and “ ‘created difficulty and discomfort’ ” in violation of the Americans with Disabilities Act (42 U.S.C. §§ 12181–12189; ADA). The complaint further alleged that Tesla’s continued failure to provide accessible service counters deterred plaintiff from returning to the dealership. Plaintiff alleged “ ‘on information and belief, that there are other violations and barriers on the site that relate to his disability.’ ” The district court granted Tesla’s motion to dismiss with leave to amend the complaint. Plaintiff declined to amend, opting to appeal instead. Affirming the dismissal, the Ninth Circuit stated: “Here, the district court correctly concluded Whitaker’s complaint did not allege facts sufficient to support his ADA claim because the complaint primarily recited legal conclusions. . . . These allegations do little more than recite the elements of an ADA claim, and fall short of putting Tesla on notice of how the counters prevented Whitaker from full and equal access to the Tesla facility. The complaint failed to answer basic questions: Were the service counters too low? Or too high? Were they positioned in an area that was inaccessible for another reason? Without this sort of factual detail, the district court and Tesla were left in the dark about how the service counters denied Whitaker from full and equal enjoyment of the premises.” (Whitaker v. Tesla Motors, Inc. (9th Cir., Jan. 25, 2021) 2021 WL 235777.)
https://cdn.ca9.uscourts.gov/datastore/opinions/2021/01/25/19-56497.pdf
Tesla Securities Fraud Suit Short-Circuited.
In 2016, Tesla announced plans to build a Model 3 sedan with a recommended retail price starting at $35,000; Tesla anticipated selling hundreds of thousands of Model 3’s a year by 2018. In a class action under the Securities and Exchange Act of 1934 and Rule 10b-5, plaintiffs alleged that in 2017, during the ramp-up to mass production of the Model 3, Tesla announced a production goal of 5,000 vehicles per week, but defendants were aware long before that announcement that, due to a variety of logistical issues, producing 5,000 vehicles a week in 2017 was unattainable. The district court dismissed the action with prejudice. The Ninth Circuit affirmed, concluding plaintiffs failed to show they could adequately plead causation. (Wochos v. Tesla, Inc. (9th Cir., Jan. 26, 2021) 2021 WL 246210.)
https://cdn.ca9.uscourts.gov/datastore/opinions/2021/01/26/19-15672.pdf
Defendant Was Not Aggrieved by Summary Judgment Ruling in Favor of Codefendant.
Plaintiffs filed a wrongful death action against a general contractor and a supplier after the death of a construction worker. The supplier cross-complained against the general contractor for equitable indemnity, contribution, and declaratory relief. The trial court granted summary judgment in favor of the general contractor on plaintiffs’ complaint. The general contractor then settled with plaintiffs, who agreed to dismiss their complaint against the general contractor. The trial court found that the settlement was made in good faith (Code Civ. Proc., § 877.6). Apparently under the shared belief that the good faith settlement determination barred the supplier’s cross-complaint against the general contractor, the supplier and the general contractor stipulated to the dismissal of the supplier’s cross-complaint against the general contractor. On appeal, the supplier challenged the summary judgment order in favor of the general contractor, the good faith settlement determination, and the dismissal of the cross-complaint. The supplier argued the trial court erroneously ruled that the supplier lacked standing to oppose the general contractor’s motion for summary judgment and refused to consider the supplier’s opposition brief. The Court of Appeal held: “We conclude [the supplier] was not aggrieved by the trial court’s exoneration of [the general contractor]in the wrongful death action. Therefore, [the supplier] lacks standing to appeal the summary judgment order in favor of [the general contractor]. As for the good faith settlement determination and the dismissal of [the supplier’s] cross-complaint, we conclude [the supplier] waived its challenge to those orders by failing to make substantive legal arguments specific to those orders. Therefore, we dismiss the appeal insofar as it pertains to the summary judgment order and affirm the remaining challenged orders.” (Atlas Construction Supply, Inc. v. Swinerton Builders (Cal. App. 4th Dist., Div. 1, Jan. 26, 2021) 2021 WL 245310.)
Potential Trust Beneficiaries Who Failed to Participate in Court-Ordered Mediation Are Bound by the Resulting Settlement.
The trustee of a decedent’s trust petitioned the probate court to determine the trust beneficiaries. The probate court ordered the matter to mediation. The potential beneficiaries received notice of the mediation, but some did not participate. The participating parties reached a settlement that excluded the nonparticipating potential beneficiaries. The probate court approved the settlement. The nonparticipating beneficiaries appealed. Affirming, the Court of Appeal stated: “A party receiving notice who fails to participate in court-ordered mediation is bound by the result.” (Breslin v. Breslin (Cal. App. 2nd Dist., Div. 6, Jan. 26, 2021) 2021 WL 247962.)
Another Police Shooting.
Two police officers followed a pickup truck after observing the driver perform or attempt to perform an illegal maneuver. The officers displayed an amber light, rather than the blue and white light typically used by police, and sounded an atypical screeching noise rather than a recognizable police siren. When the pickup truck made a three-point turn and pointed in the officers’ direction, the officers opened fire, killing the driver and wounding a passenger. The passenger and the driver’s parents sued the state and the individual officers, alleging excessive force in violation of the Fourth Amendment and other claims. The district court denied defendant’s motion for summary judgment based on qualified immunity, finding the jury could reasonably conclude the officers used excessive force in violation of clearly established law. Affirming, the Ninth Circuit stated the evidence supported the view that the three-point-turn was performed cautiously, the truck was not aimed directly at the officers, and it was moving very slowly and not accelerating when the officers began shooting. The appeals court concluded, “a reasonable jury could conclude that the Officers used excessive force, because they ‘lacked an objectively reasonable basis to fear for [their] own safety, as [they] could simply have stepped back [or to the side] to avoid being injured.’ ” (Villaneuva v. State of California (9th Cir., Jan. 28, 2021) 2021 WL 280756.)
https://cdn.ca9.uscourts.gov/datastore/opinions/2021/01/28/19-55225.pdf
Patient’s Informed Consent Cannot Negate Liability for Negligent Recommendation of a Course of Treatment.
A surgeon performed a gastric re-sleeving surgery on a woman. She subsequently sued the surgeon for negligently recommending and not obtaining her informed consent to the surgery. The jury returned a verdict in favor of the surgeon, and the patient appealed. Affirming, the Court of Appeal stated: “This appeal presents two questions: (1) when can a physician be sued for negligently recommending a course of treatment, and (2) does the patient’s informed consent negate any liability for a negligent recommendation? On the first question, we hold that a physician may be liable for negligently recommending a course of treatment if (1) that course stems from a misdiagnosis of the patient’s underlying medical condition, or (2) all reasonable physicians in the relevant medical community would agree that the probable risks of that treatment outweigh its probable benefits. On the second question, we hold that a patient’s informed consent to a negligently recommended course of treatment does not negate the physician’s liability for his negligence in recommending it. Although the trial court in this case erred by instructing the jury that the woman’s informed consent negated any liability for the surgeon’s recommendation, this error did not prejudice the woman’s case because her negligent recommendation theory should never have gone to the jury in the first place.” (Flores v. Liu (Cal. App. 2nd Dist., Div. 2, Jan. 28, 2021.) 2021 WL 282302.)
Attorney Fee Award Affirmed Against Plaintiff Who Challenged Trustee’s Sale of His Home.
Plaintiff sued defendants to set aside the trustee’s sale of plaintiff’s home and quiet title. Plaintiff abandoned several claims before trial, leaving only claims for negligence and fraud. The jury found in favor of defendants. Defendants sought attorney fees on two bases: under Civil Code § 1717, on the ground the note and deed of trust provided for the recovery of attorney fees; and under Code of Civil Procedure § 2033.420, which allows recovery of expenses incurred in proving the truth of matters a party failed to admit in response to requests for admissions. The trial court awarded attorney fees of $191,619.47 and costs of $29,345.97. On appeal, plaintiff argued he did not allege breach of contract but only claims in tort, so the action was not an action on a contract within the meaning of § 1717. Rejecting this argument, the Court of Appeal stated: “At its core, plaintiff’s suit sought to avoid his obligations under the [promissory] note by making claims defendant acted negligently and fraudulently during the foreclosure process.” As to the fees pursuant to § 2033.420, plaintiff argued that fees can be awarded only for the period after he denied the requests for admissions. Affirming the award, the appeals court said: “We agree, but since fees were also properly awarded under Civil Code section 1717, no adjustment in the fee award is necessary.” (Yoon v. CAM IX Trust (Cal. App. 2nd Dist., Div. 8, Jan. 29, 2021) 2021 WL 302504.)
Summary Judgment Reversed Because Trial Court Did Not Address Plaintiff’s Theory of Failure to Warn of a Dangerous Condition of Public Property.
Plaintiff’s son was riding his bicycle in the city of Rancho Palos Verdes when he collided with a turning truck, suffering fatal injuries. Plaintiff sued the city, alleging a dangerous condition of public property under Government Code § 835.2. Plaintiff argued the city had created a dangerous condition by removing a bicycle lane from the area of the accident, and had failed to warn of that dangerous condition, leading to the accident and death. The city moved for summary judgment, asserting it was entitled to design immunity under § 830.6. The city relied on plans for a street resurfacing project, which it claimed did not include a bicycle lane at the site of the accident. The trial court granted the city’s motion, concluding the city had proved entitlement to design immunity as a matter of law. Reversing, the Court of Appeal agreed the city was entitled design immunity, but said the trial court did not address plaintiff’s theory that the city was liable for failing to warn of a dangerous condition, stating: “[W]e hold that even where design immunity covers a dangerous condition, it does not categorically preclude liability for failure to warn about that dangerous condition. We therefore vacate the judgment in part and remand to the trial court to consider appellant’s failure to warn theory.” (Tansavatdi v. City of Rancho Palos Verdes (Cal. App. 2nd Dist., Div. 4, Jan. 29, 2021) 2021 WL 302858.)