Articles Posted in California Courts of Appeal

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This appeal challenged the trial court's denial of defendant's special motion to strike the complaint under Code of Civil Procedure section 425.16 (the anti-SLAPP statute). Defendant Federal National Mortgage Association (Fannie Mae) initiated nonjudicial foreclosure proceedings against property owned by plaintiff Crossroads Investors, L.P. (Crossroads), but Crossroads filed for bankruptcy protection, staying the proceedings. Its proposed reorganization plan called for selling the property to a third party, who would reinstate the loan but on different material terms less favorable to Fannie Mae. Fannie Mae would not be paid what it was owed in full. The bankruptcy court called the plan "dubious," and Crossroads' counsel agreed they were "trying to have our cake and eat it too." Crossroads failed to obtain confirmation of a reorganization plan, and the bankruptcy court granted Fannie Mae relief from the stay. Fannie Mae shortly thereafter sold the property, and it did so without providing prior notice to Crossroads. Crossroads filed suit for wrongful foreclosure, breach of contract, fraud, and other tort and contract causes of action. Fannie Mae filed an anti-SLAPP motion, contending the actions on which Crossroads based its complaint arose from the exercise of its constitutional rights of speech and petition; specifically, statements and omissions made in, or concerning issues under review in, the bankruptcy action. The trial court denied the motion. The California Supreme Court granted Fannie Mae's petition for review, depublished the Court of Appeals' original opinion, and transferred the matter to back to the appellate court to reconsider the appeal in light of Baral v. Schnitt, 1 Cal.5th 376 (2016). The Court of Appeals reversed the trial court's ruling and directed it to grant the anti-SLAPP motion: all of Crossroads' claims arose from Fannie Mae's constitutionally protected actions that were taken as part of, or related to, the bankruptcy action. Further, Crossroads did not establish a prima facie case in support of those claims, as all of its tort claims based on protected activity attacked statements privileged under Civil Code section 47, and its contract claims arising from protected activity were barred as a matter of law. View "Crossroads Investors v. Federal National Mortgage Assn." on Justia Law

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In a products liability case, plaintiffs Kawika and Sandra Demara appealed the grant of summary judgment granted in favor of defendants The Raymond Corporation (Raymond) and Raymond Handling Solutions, Inc. (RHSI). As pertinent to the appeal, Plaintiffs asserted claims for strict liability and negligence based on injuries Kawika suffered allegedly as a result of design defects in a forklift designed by Raymond and sold by RHSI. In granting summary judgment, the trial court ruled, in part: (1) Plaintiffs did not establish a triable issue of material fact as to causation; (2) the consumer expectation test did not apply as a matter of law; and (3) for purposes of applying the risk-benefit test, even if Plaintiffs had shown a triable issue of material fact as to causation, Defendants established the requisite elements for the application of the risk-benefit test, and Plaintiffs did not establish a triable issue of material fact as to whether the benefits of the design outweighed the risks of the design. The Court of Appeal concluded that the trial court erred in these rulings: (1) because Plaintiffs' showing as to causation was more than negligible or theoretical, it was sufficient to defeat summary judgment; (2) Defendants did not meet their burden of establishing as a matter of law that the consumer expectation test does not apply to Plaintiffs' claims; and (3) in applying the risk-benefit test, Defendants failed to present sufficient evidence to shift the burden to Plaintiffs to show a triable issue of material fact. Accordingly, the Court reversed the judgment and remanded with instructions to deny Defendants' motion. View "Demara v. The Raymond Corp." on Justia Law

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Defendant was committed to the Department of State Hospitals in 1990 after he was found not guilty of a violent crime by reason of insanity, He has been confined for most of the subsequent time. In 2015, he sought transfer to a conditional release program. At a hearing, defendant and a psychologist who had examined him testified regarding his likelihood of success in the program. The prosecution presented the testimony of three expert witnesses to contest his readiness. Under then-applicable law, an expert witness was permitted to testify with respect to the hearsay evidence on which the expert based his opinion, regardless of whether there was competent evidence to support that testimony. The trial court denied defendant’s petition. The California Supreme Court subsequently issued People v. Sanchez, which substantially limited expert testimony with respect to case-specific hearsay evidence. Had the hearing been conducted under Sanchez, at least some of the prosecution’s experts' testimony would have been excluded. The court of appeal reversed. Defendant’s testimony and his expert's testimony of provided independent evidence to support some of the otherwise-hearsay testimony, but a significant portion of the testimony was not anticipated by defendant’s evidence. The trial court found defendant’s petition to present a close case, so it is reasonably probable that the court would have granted defendant’s petition without the expert testimony rendered inadmissible by Sanchez View "People v. Jeffrey G." on Justia Law

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Defendant The Copley Press, Inc., owner of the San Diego Union-Tribune newspaper (collectively UT), appealed a trial court’s judgment finding plaintiffs (or carriers) were employees of UT in this class action suit. UT argued on appeal: (1) the class representatives were inadequate; (2) the court committed reversible error by not limiting the trial to certified issues and by granting plaintiffs' motion to amend their second amended complaint according to proof; (3) the court did not and could not manage individualized issues; (4) the court's order bifurcating plaintiffs' cause of action under Business and Professions Code section 172001 to be tried first deprived UT of its right to a jury trial; (5) the class award should have been reversed because UT paid carriers enhanced compensation that reimbursed them for expenses the court awarded; (6) the amounts the court awarded were not restitution; (7) the court erred in awarding plaintiffs prejudgment interest; (8) substantial evidence does not support the court's determination that the carriers were employees rather than independent contractors; (9) the court erred in awarding plaintiffs attorney fees under Code of Civil Procedure section 1021.5;2 (10) even if attorney fees could be awarded, the court erred by not substantially reducing them for limited success; and (11) the court erred by adopting plaintiffs' lodestar amount in awarding attorney fees. Plaintiffs appealed the award of attorney fees, arguing: (1) the court abused its discretion in not awarding an enhancement of the lodestar amount of their fees; and (2) the court erred in ruling they abandoned their cause of action for damages under Labor Code section 28023 and therefore could not recover attorney fees under that statute. The Court of Appeals affirmed in part and reversed in part the judgment, and remanded with directions to redetermine the class award, attorney fees, and prejudgment interest. In all other respects, the trial court was affirmed. View "Espejo v. The Copley Press" on Justia Law

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While hospitalized after giving birth, Kumari fell and broke her shoulder. Four months later, Kumari sent ValleyCare Health System a detailed letter describing her injury and the basis for her “medical negligence” claim. Kumari requested $240,000 and stated she would “move to the court” if she did not receive a check within 20 days. ValleyCare denied Kumari’s claim. More than a year after her injury, Kumari and her husband sued, alleging medical negligence and loss of consortium. The court granted ValleyCare summary judgment, concluding Kumari’s letter constituted a notice of intent to sue pursuant to Code of Civil Procedure section 364, which precludes a plaintiff from filing a professional negligence action against a health care provider unless the plaintiff has given that provider 90 days notice of the intention to commence the action. No particular form of notice is required; subdivision (d) tolls the statute of limitations for 90 days if the notice is served within the last 90 days of the one-year limitations period. The court of appeal affirmed that the complaint was time-barred, rejecting plaintiffs’ claim that an author’s subjective motivation for writing a letter to a health care provider is relevant when determining whether that letter is a notice of intent to sue under section 364. View "Kumari v. Hospital Committee for Livermore-Pleasanton Areas" on Justia Law

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Plaintiff Michael Shames appealed an order pertaining to attorney fees. Shames filed this lawsuit against Defendant Utility Consumers' Action Network (UCAN) and two individual plaintiffs, alleging multiple causes of action, after UCAN terminated his employment. The case proceeded to trial, and Shames prevailed on three causes of action, including one in which he sought unpaid wages in the form of bonus payments that were due to him pursuant to an incentive program. After judgment was entered, Shames sought to recover the attorney fees that he incurred in litigating his claims. Shames relied on two statutes for his request for attorney fees, but only one of those statutes was at issue in this appeal: Labor Code section 218.5. The trial court denied Shames's request for attorney fees under section 218.5, concluding that he had failed to request attorney fees "upon the initiation of the action" because he did not request attorney fees in his initial complaint. In the alternative, Shames's request for attorney fees in his amended complaint was not sufficient to permit him to recover attorney fees as costs pursuant to section 218.5. Shames's amended pleading did not request attorney fees generally, nor did it request attorney fees under section 218.5 with respect to the cause of action in which Shames alleged that UCAN had failed to pay him his full wages. Rather, the amended pleading included a reference to section 218.5 only as to a cause of action that was not brought on account of the nonpayment of wages, and one on which UCAN, not Shames, prevailed. The Court of Appeals affirmed the order of the trial court. View "Shames v. Utility Consumers' Action Network" on Justia Law

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Nelson, an attorney specializing in asbestos defense, was employed by Tucker Ellis. In 2009, Nelson became a “non-capital partner.” Gradient was retained by Tucker Ellis to assist in litigation. Nelson exchanged emails with Gradient consultants about medical research articles relating to smoking and/or radiation (rather than asbestos) as causes of mesothelioma. After Nelson left Tucker Ellis in 2011, the law firm was served with a subpoena, seeking the production of all communications between Tucker, Ellis and Gradient regarding the research. Tucker Ellis produced the attorney work product emails authored by Nelson. After Nelson was subpoenaed for deposition, he wrote a “clawback” letter to Tucker Ellis, asserting the emails contained his privileged attorney work product and demanding they be sequestered and returned to him. Nelson sought a determination that Tucker Ellis had a legal duty to protect his attorney work product from improper disclosure to third parties Code of Civil Procedure section 2018.030. The court of appeal reversed the trial court, concluding that the holder of the attorney work product privilege is the employer law firm, Tucker Ellis, not Nelson, and had no legal duty to secure Nelson’s permission before it disclosed documents he created in the scope of his employment. View "Tucker Ellis LLP v. Superior Court" on Justia Law

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Plaintiff Carmen Zubillaga was injured in an automobile accident. The other driver was at fault. Her insurer, defendant Allstate Indemnity Company (Allstate), rejected her demand for $35,000, the full amount of her remaining underinsured motorist (UIM) coverage, although it made her a series of offers increasing to $15,584 instead. After an arbitrator awarded plaintiff $35,000, the amount of her demand, she sued Allstate for breach of the implied covenant of good faith and fair dealing. While an insurance company has no obligation under the implied covenant of good faith to pay every claim its insured makes, the insurer cannot deny the claim, without fully investigating the grounds for its denial. To protect its insured’s contractual interest in security and peace of mind, it is essential that an insurer fully inquire into possible bases that might support the insured’s claim before denying it. The Court of Appeal found the problem in this case was that the undisputed facts showed the insurer’s opinions were rendered in October and November 2012, but insurer continued to rely on them through the arbitration in September 2013, without ever consulting with its expert again or conducting any further investigation. Summary judgment in favor of the insurer was reversed and the matter remanded for further proceedings. View "Zubillaga v. Allstate Indemnity Company" on Justia Law

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In 2010, Walton sued Rossdale. Walton, a California attorney, maintained a “litigation factory” by placing dozens of email addresses on the Internet, collecting spam messages sent to those addresses, and then demanding compensation for supposed violations of the Consumer Legal Remedies Act, Civil Code 1750. Walton‘s lawsuit was dismissed with prejudice in 2012. The same day, Rossdale sued Walton, alleging malicious prosecution. Rossdale was a fictitious business name registered in Florida to a Florida limited liability company, Miami Legal. In 2016, Walton argued that the lawsuit should be dismissed because Rossdale was "a fictitious business name registered by a company that has now dissolved.” Miami Legal argued that all of its assets and liabilities had been transferred to Rossdale Delaware, which Miami Legal called its “successor in interest to the causes of action.” The trial court dismissed for lack of standing. The court of appeals reversed. Rossdale was only a fictitious business name; no legitimate standing or jurisdictional issue was raised. This case does not involve an individual seeking to sue under a fictitious name to protect his identity, does not invoke serious privacy concerns, and did not raise any supposed violation of any fictitious name statute. View "Rossdale Group, LLC v. Walton" on Justia Law

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Grist Creek owns property in Mendocino County on which it has aggregate and asphalt processing operations. The County Air Quality Management District approved a permit to construct a “Crumb Rubber Heating and Blending Unit” for the production of rubberized asphalt, on the property. The District Hearing Board’s four members who considered an appeal split evenly on their vote; the Board stated no further action would be taken, leaving the permit in place. Oponents filed a petition for writ of administrative mandate, claiming that Grist Creek should have conducted an environmental review and that the District and Hearing Board violated the California Environmental Quality Act (CEQA, Pub. Resources Code, 21000) and District regulations by failing to require one. The trial court dismissed the action against the Board with leave to amend, finding the tie vote was not a decision, so there was nothing to review. The court of appeals reversed. The Board’s tie vote, in this context, resulted in the denial of the administrative appeal, subject to judicial review. View "Grist Creek Aggregates, LLC v. Superior Court" on Justia Law