Cal Biz Lit

Cal Supremes Take Away a Pro-Defense Class Certification Ruling

Back in December, I posted about the Court of Appeals decision in Sony Electronics v. Superior Court, Fourth District, D048468, a case which seemed to strike a serious blow against the certification of merits-based classes.  Figuratively puffing my chest out, I offered this:

This is kind of huge for the defense.  For example, in the Lease Documents cases in Los Angeles Superior Court, Mr. Trygar and his friends are suing just about every new car dealer in the State in a UCL class action on a variety of theories, arguing that class membership can be determined by reviewing all of the dealers' records about every transaction.  This seems to put the kaybosh on this kind of case (and could, all by itself, take the rest of the air out of the Lease Documents cases, in which yours truly happens to be one of the liaison counsel for the dealers).

Brilliant.  Nothing like a little hubris.  The California Supreme Court has now depublished the decision.  For you non-California types, that means that without deciding the merits, they decided the case can't be cited and has no precedential value.
UCL Practitioner posts on this here.  Wage  Law posts on it here.

Attorneys' Fees Under the California Vehicle Leasing Act

California’s Vehicle Leasing Act, Civil Code section 2985.7 and following, like much consumer legislation, can be very generous to consumer plaintiffs and really tough on motor car dealerships and lenders.  But once in awhile, a defendant wins a case involving a leased vehicle, and LaChapelle v. Toyota Motor Credit Corp. (2002) 102 Cal.App.4th 977,  a First District Court of Appeal decision, holds that when that happens, the consumer can be stuck for the defendant’s legal fees under Civil Code section 2988.9.   This is so even when the suit doesn’t allege violations of the leasing act, as long as the action is one “where the subject matter involves a contract subject to the provisions of” the act.  Id. at pp. 993-994.

More after the jump.

Contracts and "Extrinsic Evidence"

It’s been two weeks since I got back from vacation, and aside from practicing law, I’m still working my way through significant appellate decisions and events of interest to businesses litigating in California.  One Supreme Court decision issued while I was gone, Sterling v. Taylor, S121676,  has been the subject of surprisingly little discussion (with the exception of May It Please The Court, discussed below), particularly since the Cal Supremes disapproved no fewer than five earlier statute of frauds decisions.  The facts of the case also win this week's "What Were They Thinking?" award.

More after the jump.

More on the Microsoft MP3 Verdict

Just about my last post before I took off for 12 days holiday in China was a brief note on Alcatel-Lucent's $1.52 verdict against Microsoft in San Diego.  As I slog through the blog posts from while I was gone, it seems like just about everybody has slammed this outcome as an excellent example of the patent law being broken, with critics on the right (Overlawyered, February 25) and the left (Kevin Drumm at the Washington Monthly, February 23).  Drumm and Overlawyered's Walter Olson both quote the Washington Post's Rob Pegaroro, who notes that the verdict has something for every critic of patent abuse:

* "Submarine" patents, invoked years after a contested invention has hit the market? Check

* Claiming ownership of a media format most people use all the time? Check

* A plaintiff that's failed to commercialize its own alleged invention? Check

* Extortionate royalty demands? Check

Punitive Damages Exceeding Compensatory Damages Held Violation of Due Process

I've been in China for twelve days, completely removed from blogging (and any news other than state-run television and the People's Daily), and have much catching up to do.  With something like 600 posts in my reader, I despair of ever catching up. However, there are a few developments that caught my attention.

The first one appears in Jet Source Charter, Inc. v. Dougherty, where the Court of Appeal held that a $26 million punitive damage award violated the due process requirements of Campbell v. State Farm when the compensatory damage award, including pre-judgment interest, was $6.5 million.  The Court held that the award was impermissibly excessive for just three reasons:  (1)  the compensatory award was already substantial;  (2)  the harm caused was solely economic (this was essentially a breach of fiduciary / fraud case involving business transactions) and (3)  the plaintiff was not a particularly vulnerable victim.

Sean Martin, who manages to blog about nearly every appellate decision in California, sets forth the opposing view here.

Given the amounts involved, I'm betting on a petition to the California Supremes.  And I'm further betting that the decision sticks.