Source: https://www.uclpractitioner.com/page/2/
Timestamp: 2019-04-23 06:15:00+00:00

Document:
Many thanks to the blog reader who pointed out that in December of last year, the U.S. Supreme Court granted cert. in China Agritech, Inc. v. Resh, No. 17-432, a securities class action involving American Pipe tolling. Reuters had an interesting article about the case shortly after the grant. SCOTUSblog's case page has links to all the briefs, including numerous amicus briefs.
In May 2017, the Ninth Circuit handed down its opinion in Resh v. China Agritech, Inc., 857 F.3d 994 (9th Cir. 2017). The parties did not dispute that the American Pipe rule tolled the running of the statute of limitations for all unnamed plaintiffs in two prior class actions, or that after class certification was denied in those earlier cases, the unnamed plaintiffs could file new individual lawsuits. The question was whether they could commence new putative class actions. See id. at 1000. The Ninth Circuit held that while principles of comity or issue preclusion might apply in such a subsequent case, the proposed class claims were not time-barred. Id. at 1004.
We conclude, based on American Pipe and Crown, Cork & Seal, read in the light of Shady Grove, Smith and Tyson Foods, that permitting future class action named plaintiffs, who were unnamed class members in previously uncertified classes, to avail themselves of American Pipe tolling would advance the policy objectives that led the Supreme Court to permit tolling in the first place. The rule creates no unfair surprise to defendants because the pendency of a prior class suit has already alerted them "not only [to] the substantive claims being brought against them, but also [to] the number and generic identities of the potential plaintiffs who may participate in the judgment." American Pipe, 414 U.S. at 554-55. The rule also promotes economy of litigation by reducing incentives for filing duplicative, protective class actions because "[a] putative class member who fears that class certification may be denied would have every incentive to file a separate action prior to the expiration of his own period of limitations." Crown, Cork & Seal, 462 U.S. at 350-51.
We further conclude, based on Smith, that to the degree that our conclusion may be thought likely to lead to abusive filing of repetitive class actions, the current legal system is adequate to respond to such a concern. First, if it is clear that a proposed class is not viable under Rule 23, as evidenced by an earlier federal court decision, potential future plaintiffs (or, more precisely, their attorneys) will have little to gain from repeatedly filing new suits. Attorneys who are going to be paid on a contingency fee basis, or in some cases based on a fee-shifting statute, at some point will be unwilling to assume the financial risk in bringing successive suits. Second, ordinary principles of preclusion and comity will further reduce incentives to relitigate frivolous or already dismissed class claims, and will provide a ready basis for successor federal district courts to deny class action certification.
Id. at 1004-05 (hyperlinks added).
Yea verily, we are presented with a most unfortunate tale of a villainous wine dealer who sold millions of dollars’ worth of counterfeit wine to an unsuspecting wine collector. When the wine collector discovered the fraud, he filed an insurance claim based on his “Valuable Possessions” property insurance policy. The insurance company denied the claim. The wine collector sued for breach of contract. The trial court ruled in favor of the insurance company, sustaining its demurrer.
We agreeth with the trial court; the wine collector suffered a financial loss, but there was no loss to property that was covered by the property insurance policy. In other words, the wine collector is stuck with the devil wine without recompense. A Shakespearean tragedy, to be sure.
.... Two wines might to almost any palate taste indistinguishable — but to serious oenophiles, the difference between one year and the next, between grapes from one valley and another nearby, might be sufficient to carry with it real economic differences in how much they would pay.
Kwikset Corp. v. Superior Court (Benson), 51 Cal.4th 310, 329, 330 (2011). The fraudster in Doyle "for many years ... had apparently been filling empty wine bottles with his own wine blend and had been affixing counterfeit labels to the bottles." In other words, the case presents a textbook "fraudulent" prong claim.
Like “cloud-capp’d towers,” “gorgeous palaces,” and perhaps someday even “the great globe itself,” many arrangements endure for some time but eventually dissolve.1 So too with certain law partnerships –– including firms that are retained, before they dissolve, to handle matters on an hourly basis.
Heller Ehrman LLP v. Davis Wright Tremaine LLP, ___ Cal.5th ____ (Mar. 5, 2018) (slip op. at 1). Let us hope for better things for "the great globe itself."
In Lampe v. Queen of the Valley Medical Center, ___ Cal.App.5th ___ (Jan. 2, 2018; pub. ord. Jan. 23, 2018), the Court of Appeal (First Appellate District, Division Four) affirmed the trial court's order denying class certification of various wage and hour claims. The general thrust of the opinion is that the plaintiffs did not identify any overarching common policies that led to the asserted overtime and meal period violations. See, e.g., slip op. at 17.
New Ninth Circuit UCL preemption opinion: Lusnak v. Bank of America, N.A.
In Lusnak v. Bank of America, N.A., ___ F.3d ___ (Mar. 2, 2018), a putative class action, the Ninth Circuit held that the National Bank Act did not preempt the plaintiff's UCL "unlawful" prong claim predicated on violations of Civil Code section 2954.8(a), as well as a provision of the federal Truth in Lending Act, both of which require payment of interest on escrow account funds.
Supreme Court takes up UCL/CLRA class case: Noel v. Thrifty Payless, Inc.
On Wednesday, the Supreme Court granted review in Noel v. Thrifty Payless, no. S246490. In this case, the Court of Appeal (First Appellate District, Division Four) affirmed the trial court's order denying class certification of UCL, CLRA, and FAL claims. Noel v. Thrifty Payless, Inc., ___ Cal.App.5th ___ (2017). The opinion was handed down in December. It addressed several different issues, and it is unclear at this time which one(s) caught the Supreme Court's eye. The docket does not yet indicate the issues for review.
Today at 10:00 a.m., the Supreme Court will hand down its opinion in Hernandez v. Restoration Hardware, Inc., No. S233983. This opinion will address whether an unnamed class member must "intervene in the litigation in order to have standing to appeal" any portion of a class action judgment (in a non-settlement context). See this blog post for more on the case.
Hernandez v. Restoration Hardware, Inc., ___ Cal.5th ___ (Jan. 29, 2018). UPDATE: It turns out that the opinion did address the settlement context. The Court held that in order to have standing to appeal any kind of judgment, even one entered following a settlement, the unnamed class member must have intervened below; merely filing an objection to the settlement is not sufficient.
By the way, within the past couple of months, something changed in the permalinks to the Court's online dockets at appellatecases.courtinfo.ca.gov. I first noticed it when some of my bookmarks on my web browser were broken. This means that many of the docket links in my past blog posts are now broken as well. Those older links will take you to the Court's main docket search page, and you'll have to re-enter the case number or party name to find the docket.
The First Appellate District published two new class certification opinions in the last week. Both are wage and hour cases.
In ABM Industries Overtime Cases, ___ Cal.App.5th ___ (Dec. 11, 2017; pub. ord. Jan. 10, 2018), Division Four reversed an order denying class certification of meal period, expense reimbursement, and other claims, with directions to certify the class and subclasses. This opinion has a very interesting discussion of class definitions and the ascertainability element of class certification. It also addresses the use of expert testimony and "database analysis of timekeeping and payroll records" "as a means to show common practices for purposes of class certification." Slip op. at 20.
Then, yesterday, Division One handed down a new opinion in the long-running Duran litigation, which is a misclassification case involving an exemption defense (namely, the outside salesperson exemption). Years ago, class certification was granted and the plaintiffs prevailed at trial. The defendant appealed. The lengthy appellate process culminated in the California Supreme Court's 2014 Duran opinion (discussed here), which remanded the case back to the trial court for class certification to be addressed anew. This time, class certification was denied below, and the Court of Appeal affirmed. Duran v. U.S. Bank Nat'l Assn., ___ Cal.App.5th ___ (Jan. 17, 2018).
Like the opinion in ABM Industries, the new Duran opinion also discusses expert testimony, but of a different kind than considered in ABM Industries. The latter case is addressed in a footnote in Duran (slip op. at 24-25 n. 16).
Ninth Circuit appealability opinion: Brown v. Cinemark USA, Inc.
In Brown v. Cinemark USA, Inc., ___ F.3d ___ (9th Cir. Dec. 7, 2017), the Ninth Circuit held that the plaintiffs could pursue their appeal from the district court's order denying class certification, even though they had settled their individual claims, because the settlement was not a "sham tactic" to create an appealable judgment.
Unlike the plaintiffs in Baker, Brown and De La Rosa continued litigating their remaining individual claims after the district court denied class certification. Some of these individual claims resolved in favor of Defendants and some resulted in settlement. No facts suggest that Brown and De La Rosa engaged in sham tactics to achieve an appealable final judgment. The resolution of the present case was not a unilateral dismissal of claims, but a mutual settlement for consideration reached by both parties which expressly preserved certain claims for appeal. This case is unlike Baker, where the plaintiffs openly intended to sidestep Rule 23(f) when they voluntarily dismissed their claims.
Slip op. at 5 (emphasis added). For these reasons, the panel denied the defendants' motion to dismiss the appeal.
In a separate, unpublished opinion, the panel reversed the order denying class certification, apparently because the district court had ruled "on the basis of the pleadings," without the benefit of evidentiary submissions that would allow a full "Rule 23 analysis."
In Hefczyc v. Rady Children's Hospital-San Diego, ___ Cal.App.5th ___ (Nov. 17, 2017), the Court of Appeal (Fourth Appellate District, Division One) affirmed the trial court's denial of class certification in a declaratory relief action. The opinion's main holding is that Code of Civil Procedure section 382 does not have an equivalent to Federal Rule of Civil Procedure 23(b)(1)(A) or (b)(2), the elements of which are less onerous for declaratory or injunctive relief actions than for damages actions. See slip op. at 11-25.
[T]here is no gap in California precedent to be filled by reference to Federal Rules of Civil Procedure, rule 23(b)(1)(A) or (b)(2) (28 U.S.C.) on the issue of what class certification standards must be met when a plaintiff seeks only declaratory or injunctive relief on behalf of a class. Even when the plaintiff seeks solely declaratory or injunctive relief, California case law follows the well-established requirements that our Supreme Court has consistently stated, namely, (as relevant here) that the plaintiff must establish that (1) the class is ascertainable; (2) common questions predominate; and (3) a class action would provide substantial benefits, making it superior to other procedures for resolving the controversy.
New opinion confirms UCL and CLRA remedies are cumulative to each other: Flores v. Southcoast Automotive Liquidators, Inc.
In Flores v. Southcoast Automotive Liquidators, Inc., ___ Cal.App.5th ___ (Nov. 27, 2017), the Court of Appeal (Second Appellate District, Division Five) held that "an appropriate correction offer under the Consumers Legal Remedies Act (CLRA; Civ. Code, § 1750 et seq.) does not prevent a consumer from pursuing causes of action for fraud and violation of the UCL based on the same conduct, because the remedies are cumulative." Slip op. at 2 (footnote omitted).
Next Wednesday, September 20, 2017, from noon to 1:00 p.m., the Antitrust, UCL and Privacy Section of the State Bar of California will hold a webinar entitled: "Material Omission Claims Under California's UCL, FAL, and CLRA."
The program "will offer plaintiff and defense perspectives on the issues that arise when your case involves a material omission cause of action under the California statutes, including discussion of recent appellate decisions." The speakers are my good friend Kevin Green of Hagens Berman, who will provide the plaintiffs' perspective, along with Timothy W. Loose of Gibson, Dunn and Crutcher, on the defense side.
This sounds like a very interesting program. For more information and to register, click here.
Yesterday, the Supreme Court issued an order depublishing the Court of Appeal's opinion in Bartoni v. American Medical Response West, 11 Cal.App.5th 1084 (2017). Under Rule of Court 8.1115, the opinion is no longer a citable precedent.
The depublication requests, one of which was filed by yours truly, argued that this holding was inconsistent with Augustus and Brinker, which together held that meal periods (and rest breaks), to be compliant, must be entirely "off-duty," and that an "on-call" meal period (or rest break) is not an "off-duty" one. See Augustus v. ABM Security Services, Inc., 2 Cal.5th 257, 269-72 (2016) (citing Brinker Restaurant Corp. v. Superior Court, 53 Cal.4th 1004, 1039-40 (2012)).

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