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California Law Update – October 2022

By October 31, 2022December 3rd, 2022Law Updates
  1. (Elder Abuse Act) In an Elder Abuse Act case, substantial evidence did not support that medical center had a robust caretaking or custodial relationship with elderly patient. Daniel Kruthanooch v. Glendale Adventist Medical Center (No. B306423 Los Angeles County Super. Ct. No. BC692929 California Court of Appeal Second Appellate District Division Three Filed October 4, 2022)
  2. (Administrative Hearing) Administrative law judge allowing expert testimony from witnesses that were not identified until five days before the hearing did not deprive the accused of a fair hearing. Everet Gordon Miller v. Department of Real Estate (No. B311510 Los Angeles County Super. Ct. No. 19STCP00490 California Court of Appeal Second Appellate District Division Seven Filed October 17, 2022)
  3. (Default Judgment) In an unlawful detainer action, plaintiff’s counsel breached its ethical and statutory obligation to advise opposing counsel of the intent to seek entry of a default judgment. Shapell Socal Rental Properties, LLC v. Chico’s Fas, Inc. (No. G060411 Super. Ct. No. 30-2020-01171096 California Court of Appeal Fourth Appellate District Division Three Filed October 17, 2022)
  4. (Data Breach) In a medical data breach case, denying class certification was appropriate where each putative class member’s right to recover depended on proving that their medical information was actually viewed. Maria Vigil v. Muir Medical Group IPA, Inc. (No. A160897 Contra Costa County Super. Ct. No. C1801331 California Courts of Appeal First Appellate District Division Two Filed October 18, 2022)
  5. (ADA) Given the repetitive nature of high-frequency Americans with Disabilities Act litigation, district court provided adequate concise but clear explanation of the grounds for decision to significantly reduce award for attorney’s fees. James Shayler v. 1310 PCH, LLC (No. 21-56130 D.C. No. 2:20-cv-10751-GW-GJS United States Court of Appeals Ninth Circuit Filed October 24, 2022)
  6. (Public Entity/Treble Damages) Treble damages provision in Code of Civil Procedure Section 340.1 for a claim involving a prior cover-up of childhood sexual abuse is not applicable to public school districts. K.M. v. Grossmont Union High School District (No D075957 Super. Ct. Nos. 37-2015-00004806-CU-PO-CTL, 37-2016-00006248-CU-PO-CTL California Court of Appeal Fourth Appellate District Division One Filed October 25, 2022)
  7. (Non-Delegable Duty) Failure to instruct jury on nondelegable duty was prejudicial when plaintiff’s theory of the case was based on imputed negligence resulting from manufactures nondelegable duty to provide a safe product. Chad Defries v. Yamaha Motor Corporation, U.S.A. (No. E073917 Super. Ct. No. RIC1710904 California Court of Appeal Fourth Appellate District Division Two Filed October 26, 2022)
  8. (Offer to Compromise) A Section 998 offer to settle becomes inoperative once the court issues a summary judgment ruling, whether written or oral Ana Isabella Trujillo v. City of Los Angeles (No. B314042 Los Angeles County Super. Ct. No. 19STCV08109 California Court of Appeal Second Appellate District Division Two Filed October 27, 2022)
  9. (Offer to Compromise) Where Section 998 offer required a general release that encompassed claims beyond the scope of the litigation, the compromise offers were invalidated, and trial court erred in denying taxing of costs. Council for Education and Research on Toxics v. Starbucks Corporation (Nos. B309227/B310481 Los Angeles County Super. Ct. No. BC435759 California Courts of Appeal Second Appellate District Division Four Filed October 26, 2022)

The above referenced court opinions have come to our attention during last month. Please find below a brief summary of these opinions for your consideration.

  1. (Elder Abuse Act) In an Elder Abuse Act case, substantial evidence did not support that medical center had a robust caretaking or custodial relationship with elderly patient. Daniel Kruthanooch v. Glendale Adventist Medical Center (No. B306423 Los Angeles County Super. Ct. No. BC692929 California Court of Appeal Second Appellate District Division Three Filed October 4, 2022)

Plaintiff appealed from a judgment after the trial court granted a motion for judgment notwithstanding the verdict in favor of the defendant hospital following a jury trial of plaintiff’s claim of neglect under the Elder Abuse and Dependent Adult Civil Protection Act (Welf & Inst. Code, section 15600 et seq) (Elder Abuse Act). The underlying facts involved a patient who presented with complaints of weakness and lightheadedness. Several hours later, the patient underwent an MRI scan and sustained a burn to his abdomen due to the hospital’s alleged failure to screen the patient for electrically condusive materials prior to the scan. The patient was discharged two days later.

The trial court concluded that the evidence failed to support the claim that the hospital had a substantial caretaking or custodial relationship with the patient, which is a prerequisite for recovery for neglect under the Elder Abuse Act. The court also concluded that the hospital’s conduct in failing to properly screen the patient involved neglect under the Elder Abuse Act because it arose not from a failure to provide medical care but from the negligent provision of care.

The appeals court the affirmed the trial court’s findings on both grounds. The appeals court noted that under the Elder Abuse Act, the custodial caretaking relationship must be “robust”, and the measure of responsibilities assumed by the caretaker “significant”. In this case, the evidence did not support a robust caretaking or custodial relationship involving ongoing responsibilities with the patient. Although the patient was ill when he presented at the emergency department, substantial evidence did not support that the patient was cognitively impaired. Nor was there substantial evidence that the patient sought or required ongoing assistance with eating, drinking, toileting, or any other basic needs. Accordingly, the trial court properly granted the motion for judgment notwithstanding the verdict.

  1. (Contracts) Settlement agreement containing condition precedent regarding method of payment that never materialized was still enforceable because it contained an independent, enforceable promise to pay. Helen Gray-Jones v. Sandra Spencer (No. A162543 San Mateo County Super. Ct. No. 17PRO01298 California Court of Appeal First Appellate District Division Three Filed September 2, 2022)

Plaintiff was a real estate broker operating as a property manager/owner of a mobilehome park. The Department of Real Estate filed an accusation alleging that the Plaintiff violated the law by (1) employing an unlicensed individual to solicit and enter into lease-to-own agreements with tenants/buyers of several mobile homes; and (2) permitting the tenant/buyers to move into mobile homes that were not permitted for human occupancy. Following a hearing, an administrative law judge ruled that the property violated the law and issued an order revoking the license of the broker.

The Plaintiff filed a petition for a writ of administrative mandate, contending it did not receive a fair hearing because the administrative law judge considered expert testimony of several witnesses the Department of Real Estate did not designate as experts.

The trial court denied the petition, ruling that the administrative law judge did not consider any improper evidence and, after conducting an independent review of the evidence, found that the Plaintiff violated the applicable statutes. The plaintiff appealed, making the argument to the appellate court. The appeals court affirmed the trial court’s ruling. The appeals court found that the Administrative Procedure Act does not prohibit a witness from providing expert opinion testimony because the proponent of the testimony did not exchange certain information about the witness with the opposing party in a timely fashion. In fact, in administrative hearings, any relevant evidence shall be admitted if it is the sort of evidence on which responsible persons are accustomed to relying, regardless of any common or statutory law which might make the admission of the evidence over objections improper. In this case, individuals gave expert testimony, even though the Department failed to designate them as expert witnesses prior to the hearing. Nonetheless, the plaintiff failed to show any evidence that the expert testimony was not the kind of evidence a responsible person is accustomed to rely on. Moreover, even if allowing the testimony was error, the plaintiffs failed to show it was prejudicial because the testimony was merely additional evidence that the lease-to-own agreements were sales.

  1. (Default Judgment) In an unlawful detainer action, plaintiff’s counsel breached its ethical and statutory obligation to advise opposing counsel of the intent to seek entry of a default judgment. Shapell Socal Rental Properties, LLC v. Chico’s Fas, Inc. (No. G060411 Super. Ct. No. 30-2020-01171096 California Court of Appeal Fourth Appellate District Division Three Filed October 17, 2022)

In this unlawful detainer action, counsel for the Plaintiff requested and obtained a default and default judgment against the defendant in direct violation of ethical and statutory obligations confirmed of California case law. In La Salle v. Vogel (2019) 36 Cal.App.5th 127, 137, an attorney has both ethical and statutory obligations to warn opposing counsel, if the identity is known, of an intent to seek a default and to give counsel a reasonable opportunity to file a responsive pleading. During the underlying lease dispute, Defendant had asked Plaintiff to direct communications to its counsel. Despite that request, and despite with the holding of La Salle v. Vogel, Plaintiff counsel never communicated with Defendant’s counsel about an intent to seek a default and default judgment before requesting one from the trial court. Plaintiff’ counsel not only failed to notify Defendant’s counsel of a complaint, counsel also effected service of the complaint and the request for entry of default and default judgment in a way which was deemed intentionally and precisely calculated to create a strong possibility of a default.

The appeals court found that the trial court inexplicably denied Defendant’s motion and failed to approach the ethical and statutory duties by plaintiff’s counsel. The appeals court reversed the order denying the Defendant’s motion to satisfy the default and default judgment.

  1. (Data Breach) In a medical data breach case, denying class certification was appropriate where each putative class member’s right to recover depended on proving that their medical information was actually viewed. Maria Vigil v. Muir Medical Group IPA, Inc. (No. A160897 Contra Costa County Super. Ct. No. C1801331 California Courts of Appeal First Appellate District Division Two Filed October 18, 2022)

Plaintiff filed a class action against a medical group; claiming that it failed to secure patients’ personal information, thereby allowing a former employee to download private medical information belonging to over 5,000 patients and take it with her when she left her employment with the medical group. Among other causes of action, the class action complaint alleged violation of Civil Code section 56.101 and 56.36 of the Confidentiality Medical Information Act (CMIA) by negligently releasing class members confidential medical information.

Several months after initiating the action, plaintiff filed a motion for class certification. The trial court denied the motion, finding as to the CMIA claim that each class member would have to show that the confidential nature of his or her medical information had been breached by an unauthorized party, as required by Sutter Health v. Superior Court (2014) 227 Cal. App.4th 1546, and therefore that common issues would not predominate.

Plaintiff appealed, asserting that the trial court relied on an erroneous reading of the CMIA and that a breach of confidentiality can be shown on a class wide basis. The appeals court rejected those arguments and affirmed concluding that the trial court properly applied the CMIA and exercised its discretion in denying the class certification. It noted that each class member would have had to prove an unauthorized person viewed their confidential information to recover under the CMIA and that the breach of confidentiality was caused by the data breach. Even though, issues existed for the putative class members, each class member’s right to recover depended on the facts peculiar to his or her case, so the common issues did not predominate.

  1. (ADA) Given the repetitive nature of high-frequency Americans with Disabilities Act litigation, district court provided adequate concise but clear explanation of the grounds for decision to significantly reduce award for attorney’s fees. James Shayler v. 1310 PCH, LLC (No. 21-56130 D.C. No. 2:20-cv-10751-GW-GJS United States Court of Appeals Ninth Circuit Filed October 24, 2022)

Plaintiff was a serial Americans with Disabilities Act (ADA) litigant, who sued Defendant for violating the ADA and similar protections under California law. The lawsuit was largely uncontested by the Defendant and resulted in summary judgment in plaintiff’s failure on the ADA claim. After prevailing on the merits, Plaintiff moved for an award of over $34,000 in attorney’s fees and costs. The district court reduced this award significantly, finding factors such as the routine nature of the work performed by the plaintiff’s attorneys and the lack of meaningful opposition by the defendant warranted the use of a $300/hour for “blended billing rate” for al the work performed by Plaintiff’s counsel, as well as a 65% downward multiplier to a total amount of fees. Ultimately, the district court awarded just under $10,000 in fees and costs. Plaintiff appealed, arguing that this downward reduction was unjustified. The appeals court determined that it had jurisdiction, and it affirmed the district court’s ruling. It found the district court provided clear explanation of the grounds for its decision and did not abuse its broad discretion. Given the repetitive nature of high-frequency ADA litigation, there was nothing irrational about the district court’s conclusions that, in effect, much of the work here could have been performed by a junior associate or even paralegals, or that much of the motion practice in the case was superfluous.

  1. (Public Entity/Treble Damages) Treble damages provision in Code of Civil Procedure Section 340.1 for a claim involving a prior cover-up of childhood sexual abuse is not applicable to public school districts. K.M. v. Grossmont Union High School District (No D075957 Super. Ct. Nos. 37-2015-00004806-CU-PO-CTL, 37-2016-00006248-CU-PO-CTL California Court of Appeal Fourth Appellate District Division One Filed October 25, 2022)

Plaintiff sued Defendant school district for negligence based on alleged sexual abuse by their high school drama teacher. They asserted sexual harassment claims under Civil Code section 51.9, to which the Defendant successfully demurred. The Defendant made Code of Civil Procedure section 998 offers, which Plaintiffs did not accept. The case proceeded to a jury trial, where the trial court excluded certain evidence and mistakenly included Plaintiffs in a jury instruction regarding apportionment of fault. Plaintiffs prevailed, and the jury assigned 60 percent of fault to the teacher, and 40 percent to the Defendant with resulting damage awards lower than the section 998 offers presented by the defendant. The parties moved to tax each other’s costs. The trial court ruled the offers were invalid, granting Plaintiffs’ motion, and denied the Defendant’s motion in pertinent part.

Both parties appealed. The Legislature later enacted Assembly Bill No. 218 (Assembly Bill 218), which amended Code of Civil Procedure section 340.1 to reduce procedure barriers for childhood sexual abuse claims and to allow treble damages for a claim involving a prior cover-up of abuse.

Plaintiffs sought a new trial. They contended they are entitled to pursue treble damages, and that the trial court erred by sustaining the demurrers to their sexual harassment claims, excluding certain evidence, and giving the erroneous oral jury instruction. The Defendant argued the trial court wrongly determined its Code of Civil Procedures section 998 were invalid. The appeals court concluded that treble damages provision in Code of Civil Procedure section 340.1 is neither retroactive, nor applicable to public school districts. The appeals court further concluded that Plaintiffs did not establish they could pursue sexual harassment claims against the District under Civil Code section 51.9. The appeals court affirmed the judgment and postjudgment orders.

The court noted that treble damages while available under Code of Civil Procedure section 340.1 could be prohibited under another law. The court concluded the Government Code Section 818, which precludes a public entity from being liable for damages awarded under section 3294 of Civil Code, or other damages imposed primarily for sake of example and by way of punishing barred the application of the treble damages’ statute to the District.

  1. (Non-Delegable Duty) Failure to instruct jury on nondelegable duty was prejudicial when plaintiff’s theory of the case was based on imputed negligence resulting from manufactures nondelegable duty to provide a safe product. Chad Defries v. Yamaha Motor Corporation, U.S.A. (No. E073917 Super. Ct. No. RIC1710904 California Court of Appeal Fourth Appellate District Division Two Filed October 26, 2022)

Plaintiff suffered injuries while riding Defendant’s motorcycle. Plaintiff sued the U.S. distributor of the motorcycle and the manufacturer, among others, asserting that the accident was caused by a throttle assembly that fell off the handlebar as he was riding. The jury found in Defendant’s favor, and the trial court later awarded Defendant’s costs.

On appeal, Defendant contended, among other things, that the court erroneously denied his request to instruct the jury that Defendant manufacturer was liable for its dealer’s negligent assembly of the dirt bike, a ruling that limited the Plaintiffs negligence cause of action to the manufacturer’s own negligence. California law, however, places responsibility for defects, whether negligently or non-negligently caused, on the manufacturer of the completed product regardless of what part of the manufacturing process the manufacturer chooses to delegate to third parties. The same principle applies to distributers. As the distributor of a completed product, the Defendant manufacturer could not delegate its duty, cannot escape liability on the ground that the defect in the bike may have been caused by something one of its authorized dealers did or failed to do. Thus, the Plaintiff was relieved of proving that the manufacturer or distributor was negligent in the production, design, or dissemination of the product. Rather, if the dealer negligently assembled the product, the defendant manufacturer was jointly liable for damages caused by that negligence. Because the requested instruction should have been given, the appeals court reversed the judgment on the negligence cause of action.

  1. (Offer to Compromise) A Section 998 offer to settle becomes inoperative once the court issues a summary judgment ruling, whether written or oral Ana Isabella Trujillo v. City of Los Angeles (No. B314042 Los Angeles County Super. Ct. No. 19STCV08109 California Court of Appeal Second Appellate District Division Two Filed October 27, 2022)

The Defendant had moved for summary judgment and made a settlement offer pursuant to Code of Civil Procedure section 998 days before the hearing on its summary judgment motion. Mere minutes after the trial court orally granted the summary judgment, the plaintiff sent an email to the defendant purporting to accept the statutory offer to compromise. The question presented to the appellate division was whether a statutory offer to compromise under section 998 automatically expires when a trial court orally grants the offeror’s summary judgment motion? The appeals court held that the answer was “yes”. Because the trial court came to the same conclusion, the appellate court affirmed. The appellate court found that the statutory offer to compromise became inoperative when the trial court issued its oral decision on the summary judgment motion. Section 998’s text indicated that on offer can only be made when a “dispute to be resolved” existed. The trial court foreclosed any dispute when it issued its oral decision in favor of the defendant. Additionally, Section 998’s purpose is to encourage the early settlement of disputes so that the parties can achieve the certainty of a known outcome and eliminate the uncertainty inherent in litigation. It would defeat the statute’s purpose and actively discouraged early settlement if a party could wait and see how the court ruled before accepting an offer.

  1. (Offer to Compromise) Where Section 998 offer required a general release that encompassed claims beyond the scope of the litigation, the compromise offers were invalidated, and trial court erred in denying taxing of costs. Council for Education and Research on Toxics v. Starbucks Corporation (Nos. B309227/B310481 Los Angeles County Super. Ct. No. BC435759 California Courts of Appeal Second Appellate District Division Four Filed October 26, 2022)

Plaintiff filed Proposition 65 suits against several coffee companies alleging they filed to provide warnings due to the presence of a known carcinogen. New regulations eliminated the need for the Prop 65 warnings, claimed to be required in this litigation. The Defendants moved for summary judgment which the trial court granted. Some of the Defendant companies sought Code of Civil Procedure Section 998 costs based on compromise offers to the plaintiff which were rejected during litigation. Plaintiff moved to tax costs arguing in part that the releases the companies included were overbroad. Under the offers’ terms, plaintiff was to provide two types of releases, one that as a plaintiff suing in public’s interest released “all claims…known or unknown” and the other in its individual capacity provided for “a general release”. The trial court denied the motion to tax costs and awarded the requested post-offer costs to the Defendant.

The appeals court reversed in part and noted that Section 998 offers required a determination of whether the terms of this offers were more favorable than the judgment. Consequently, because the proposed releases with extraneous claims or inclusion of release of claims beyond those involved in the litigation did not allow for valuation. Even though Plaintiff approved the other Defendants’ Section 998 offers containing the same release, the relevant question was whether the offers allowed for a favorable determination, not whether the offers prejudiced the Plaintiff. Thus, because these remaining Defendants’ offers required the court to make a valuation of potential claims outside the scope of litigation, it was invalid for purposes of Section 998 and the trial court erred in denying the Plaintiff’s motion to tax costs.

Should you have any questions concerning these court decisions or desire a copy of any of them, please do not hesitate to contact our office.