Cal Biz Lit

Off-Topic Heat Wave Musical Post

It's 86 degrees at 3:30 p.m. in San Francisco.  Martha Reeves and the Vandellas time.

Another California Runaway Verdict

    That is, the jury ran away from the plaintiff as fast as they could.  Dish Network sues News Corp.'s NDS Unit for over a billion bucks, contending an NDS employee hacked into its network, stole code, posted the code on the internets so everybody could watch satellite tv for free.  Jury finds for plaintiff.  Awards $1,500 dollars.

    Hat tip to California Punitive Damages.

Attorneys' Fee Awards in California III: More Attorney Fee Shifting Statutes

    In an earlier post, I wrote about contractual fees to the prevailing party, how a one-sided fee provision in a contract becomes bilateral by operation of law, and how a narrow fee provision can relate to all disputes between the parties to a contract.  In a second post, I discussed fee awards in civil rights, employment and public interest litigation.

    There are scores of fee-shifting statutes in California, many of them dealing with fairly rare and obscure kinds of litigation.  But in this post, I’m going to talk about a few of them, roughly in the order of likelihood that a business litigating in this state is likely to encounter them.

    The post continues after the jump.

Ford's Petition for Review in Buell-Wilson Punitive Damages Case

I blogged in March, here, on the Court of Appeals' decision in Buell-Wilson v. Ford (2008) ___ Cal.App.4th ___ (Fourth Dist., D045154).  There, after the Cal Supremes remanded so the court could take another look at the $55 million punitive damage award, the court of appeals did.  And affirmed it again.  I looked in my crystal ball at the time, and wrote that this might be the end of the road for Ford, because "[t]he Court of Appeal seems to have set up enough procedural obstacles that the Supremes won’t get involved unless they really, really, really are determined to slap down excessive punitive damages awards."

Well, we'll find out.  Not unexpectedly, Ford has petitioned the California Supreme Court yet again.  The California Supremes do not accept cases to correct error:  instead, under California Rules of Court, rule 8.500(b)(1), that court generally grants review in civil cases "When necessary to secure uniformity of decision or to settle an important question of law."

Ford is contending that both reasons are present here.  Interestingly, its third basis for requesting review has to do with proffered evidence of government and industry standards and custom and practice in this product liability suit.  While Ford's immediate quarrel is that the trial court excluded this evidence as irrelevant to the punitive damage claim, Ford seems to go farther, suggesting that if it conformed to such standards, customs and practices, punitive damages would be barred as a matter of law.  The chances of ever establishing that proposition seem pretty slim, but if Ford ever carried this off, it would be about the biggest event in the California history of punitive damages / product liability jurisprudence.

Anyway, the Supreme Court has sixty days from April 28 in which to grant review, or ninety days if it grants itself an extension, so we'll know by this summer what the Court has in mind.
 

Contractual Attorney Fee Awards When There's No Jurisdiction over the Defendant

I'm still trying to finish my three-part series on attorneys' fees.  Soon, I promise.  But I keep seeing new cases.  Since part of the audience for this blawg is non-California companies who find themselves ensnared in litigation here, this story with a happy ending for an out-of-state litigant might be of interest.

I previously blogged here about contractual attorneys' fees.  The fundamental principal is in Civil Code section 1717:  if the contract says Party "A" gets fees if he wins, and Party "B" wins instead, the law makes the contractual provision mutual:  Party "B" gets fees, even if the contract only addresses party "A's" rights.

Which brought us, yesterday, to Profit Concepts v. Griffith  (2008) ___ Cal.App.4th ___ (4th District, G039077).  Profit Concepts was a California corporation with an ex-employee, Griffith,  residing in Oklahoma.  It sued him for breach of contract, trade secrets violations and for an injunction (perhaps not a wise idea in general, but that discussion is for another day).   Griffith moved to quash service on the ground that the California courts had no jurisdiction over him.  Profit Concepts filed a "statement of non-opposition," and now I really don't know what the company, or its lawyers, were thinking.  So the motion to quash was granted.

Now comes the attorneys' fees part.  There was an employment contract, which provided that if Griffith breached the contract, Profit Concepts could get an injunction, damages and attorneys' fees.  In other words, the contractual right to fees was unilateral in Profit Concepts' favor. 

The parties agreed that the unilateral language had to be enforced mutually under section 1717.  (What was this employer doing here, anyway?)  But Profit Concepts contended that Griffith wasn't a "prevailing party" just because he got the case dismissed for lack of jurisdiction.

Wrong.  Fees awarded to Griffith, the non-California resident.  The case was going no further, he was dismissed, so he was the prevailing party.  Oh, and the amount of the fees and costs?  $3,400.78.  That's what was at stake in this appeal.  What was this employer thinking?

Happy 109th Birthday Duke Ellington

Way, Way, Way Off Topic Musical Post.  Sometimes people just have to indulge me.

Here's he is on piano for 6 hands, with Willie the Lion Smith and Billy Taylor from the David Frost Show in 1969:

When Can Attorneys' Fees Be Awarded in a FEHA Case?

I am two thirds of the way through a three part post on attorneys’ fees, and have gotten a little bogged down (the pesky details of my law practice have gotten in the way of long posts).  At any rate, the first post, on the contractual right to fees, is here.  The second, dealing with fees in civil rights, employment and public interest litigation, is here.  The final installment will cover fees in consumer litigation, and (I hope) it will be up in the next ten days or so.

But a recent decision, Villanueva v. City of Colton (2008) ___Cal.App.4th___ (4th Dist., E042188) reminds me that I should have mentioned the rare circumstance under which a successful defendant can be awarded attorneys’ fees against an unsuccessful plaintiff under California’s Fair Employment and Housing Act.  Fundamentally, the situation is this:

Government Code section 12965(b) authorizes an award of reasonable attorneys’ fees and costs “to the prevailing party” in a FEHA action.  But, tracking the comparable provisions in Federal Title VII actions and the U.S. Supreme Court’s decision in Christiansburg Garment Co. v. EEOC (1978) 434 U.S. 412,421, California courts have held that a prevailing defendant can be awarded attorneys’ fees only if the suit is objectively “frivolous, unreasonable or without foundation.”  Rosenmann v. Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro (2001) 91 Cal.App.4th 859;  Cummings v. Benco Building Services (1992) 11 Cal.App.4th 1383.

In order to ensure that plaintiffs are not unduly punished for asserting their civil rights, Rosenman requires that, before awarding fees to a defendant, the trial court must make findings that the plaintiff is capable of paying.  The same holding appears in Jersey v. John Muir Medical Center (2002) 97 Cal.App.4th 814, where the court of appeal also reversed a trial court of fees against the plaintiff based on a finding of “no merit” – not the proper standard.

In the recent Villanueva decision, the plaintiff failed to offer evidence of his inability to pay attorneys’ fees other than showing that he earned $25 per hour.  The court of appeal held that without such evidence, the trial court’s award of fees could not be an abuse of discretion, effectively placing the burden of proof  on this issue, or at least the burden of going forward, on the plaintiff.

San Diego Jury Awards Punitive Damages to Marine Captain Against Military Insurer

The Los Angeles Times reports that last week a San Diego jury awarded $3.6 million to a Marine captain serving in Iraq against his homeowners' insurer, USAA.  The jury found that the company, which specializes in insuring military personnel, cheated him and defrauded him in connection with water damage to his Oceanside home.  The plaintiff testified early in the trial, then was deployed  to Iraq before the jury awarded  $84,000 to fix his  water damage, $50,000 for emotional distress and $3.5 million in punitive damages. The trial judge would not allow the jury to be told he was deploying to Iraq, and he testified in civilian clothes.

In these rarified times and in this State, it's not that unusual a verdict.  But here's the unusual part:  The San Antonio Express's blog, MySA.com (in Texas, not California) received some 90 posts on the verdict, ranging from scathingly anti-plaintiff (suggesting he should have stayed home from Iraq and paid attention to his water damage) to similarly anti-USAA.  USAA posted a carefully measured response at the same blog.  As is customary after disappointing verdicts, it defends the company's position, expresses its disappointment, and bravely assures readers that the Court of Appeal will straighten out this misunderstanding.  But USAA then writes:

First and foremost, USAA respects and honors Capt. Colombero's military service. We stand on our record of excellent service to the U.S. Military and their families for more than 85 years, as evidenced by our member satisfaction, claims satisfaction and customer retention rates — the highest in the insurance industry. We disagree with any statements that criticize our military members or suggest that they should not answer their call to duty.

California Blog of Appeal

I recently, and belatedly, discovered Greg May's California Blog of Appeal.  May is an instructive and very prolific blogger, who posts on "issues at the intersection of trial and appellate practice."  And yesterday, he hosted Blawg Review #155.  I'm adding to the list of CalBizLit's Approved Blogs.

Faster Than A Plodding Lawsuit; More Powerful Than Summary Judgment

The Weintraub Firm's engaging, if often over my head,  IP Law blog reports here on the U.S. District Court, Central District's latest ruling in litigation between the heirs of the creators of Superman and DC Comics.  Royalty rights from the Man of Steel have been in litigation for -- wait for it -- more than sixty years.  IP Blog gives a good outline of the history of the litigation stemming from the original contract rights of Jerome Siegel and Joseph Shuster, who invented  the big guy as Cleveland teenagers in 1933, granted rights to DC in 1938, and filed their first suit against the company in 1947 (they also litigated in 1969-70, and the current suit was filed in 2004).  Most recently, the district court has denied summary judgment to DC, thus, as IP Law Blog observes, "ensuring another ten years of litigation."