The UCL Practitioner

State Bar's new antitrust and UCL treatise now available

The new edition of California State Antitrust and Unfair Competition Law (LexisNexis 2009), published by the State Bar's Antitrust and Unfair Competition Law Section, is now available and can be ordered here.  It is a thick, hardbound book, with a distinguished list of contributors, and well worth adding to your library.  It is also available through Lexis. 

If you are not a member of the Section, I would encourage you to join.  Also, mark your calendars for the Section's 20th Annual Golden State Antitrust and Unfair Competition Law Institute, which will take place this year on Thursday, October 21 at the Westin St. Francis in San Francisco.  I am the co-chair for the UCL component of this year's program.  If you have ideas for topics you'd like to see covered, please drop me a line.

One-year anniversary of en banc argument in Dukes v. Wal-Mart

One year ago today, an eleven-judge en banc Ninth Circuit panel heard oral argument on rehearing in Dukes v. Wal-Mart, Inc., nos. 04-16688 & 04-16720. 

In 2007, a three-judge panel (with one judge dissenting) affirmed the trial court's order granting class certification under Rule 23(b)(2) of plaintiffs' Title VII claims for gender discrimination. Dukes v. Wal-Mart, Inc., 509 F.3d 1168 (9th Cir. 2007).  The Ninth Circuit granted en banc rehearing in February 2009.  My report on the oral argument from March 2009 is here. 

The Ninth Circuit's "Status of Pending En Banc Cases" page lists the case as "not yet decided."  Lately we have been seeing opinions in cases argued on or about the same day as Dukes, so it would stand to reason that the opinion will be coming soon.  This blog post will go up at 5:00 a.m., so perhaps when new opinions are posted at 10:00, it will be there. 

More materials from Weinstat v. Dentsply

Here are more materials from Weinstat v. Dentsply, no. S180179:

• Letter Supporting Review of American Honda Motor Co. (dated 03/12/10)
• Reply to Answer to Petition for Review (filed 03/12/10)
• Letter Supporting Review of the U.S. Chamber of Commerce et al. (dated 03/18/10)

The reply brief (at p. 2) cites this blog and this blog post in particular.  That's the post where I listed the nine post-Tobacco II decisions handed down to date. 

As the reply brief notes, I did say that the opinions were difficult to reconcile, but I did not say it was impossible.  And while I appreciate being described to the Supreme Court as a "prominent UCL commentator," I do not support the petition for review in Weinstat.   

Orange County District Attorney's UCL action against Toyota

You've probably read about the UCL public prosecutor action filed by the Orange County District Attorney's office against Toyota.  Here is a copy of the complaint (also available at the OCDA's website).  The DA is jointly represented by his own office and by the Robinson Calcagnie firm. 

The complaint is a pure UCL action seeking statutory penalties under Business & Professions Code section 17206.  It separately pleads the "unlawful," "unfair," and "fraudulent" prong claims.  The DA will not have to worry about satisfying Prop. 64's standing requirements. Nor will he have to worry about class certification. There does not appear to be any basis for removal under CAFA because the case is not (and does not need to be) pleaded as a class action. (Page 2 of the complaint also cites cases in support of an independent reason why the case should not be removable.)

In calculating the penalty amount, the trial judge will have a lot of discretion to decide what “for each violation” means in section 17206(a). One very reasonable interpretation is that every car Toyota sold in California without disclosing the alleged safety hazards constitutes a UCL violation and triggers the $2,500 penalty.

As for where the money goes, Business & Professions Code section 17206(c) (second sentence) states: “If the action is brought by a district attorney or county counsel, the penalty collected shall be paid to the treasurer of the county in which the judgment was entered.”  The final sentence of section 17206(c) further specifies: “The aforementioned funds shall be for the exclusive use by the Attorney General, the district attorney, the county counsel, and the city attorney for the enforcement of consumer protection laws.” That final sentence was added by Prop. 64.

Needless to say, it will be interesting to see how this case proceeds.

Tobacco II attorneys receive CLAY Awards

Congratulations to Sharon Arkin, Tom Haklar, Kevin Calcagnie and Mark Robinson on being named 2010 California Lawyer Attorneys of the Year. They are the team who "pulled out a ground-breaking victory in May at the California Supreme Court" in Tobacco II. 

Recent UCL "unfair" prong case: Drum v. San Fernando Valley Bar Association

In Drum v. San Fernando Valley Bar Association, ___ Cal.App.4th ___ (Feb. 24, 2010), the Court of Appeal (Second Appellate District, Division Five) upheld a judgment entered after the defendant's demurrer to the plaintiff's UCL claim was sustained without leave to amend. 

Plaintiff was a former attorney and private mediator who sought to buy the San Fernando Valley Bar Association's membership list so that he could market his services to its members.  Slip op. at 2.  The Association refused to sell it to him, so he filed suit under the UCL seeking a mandatory injunction.  Id.  The Court of Appeal held (without deciding whether this was a "consumer" or a "competitor" action) that the Association's conduct was not "unfair" under any of the three formulations:

A voluntary bar association’s unilateral refusal to sell its membership list to any particular buyer, even if the association’s reason was to protect some of its members from price competition, is not an “unlawful, unfair or fraudulent business act or practice” under the UCL (§ 17200).

Id. at 5.  The Court of Appeal also observed that plaintiff "did not allege that he lost or expended or was denied any money or property as the result of the Association’s refusal to sell him its membership mailing list," and therefore lacked Prop. 64 standing to bring the action.  Id. at 4.

More on Hertz Corp. v. Friend and diversity jursidiction under CAFA

The Supreme Court's opinion in Hertz Corp. v. Friend, 599 U.S. ___ (Feb. 23, 2010), does not mention the Class Action Fairness Act by name, although the action was removed to federal court under CAFA, and the remand order reached the Supreme Court only because 28 U.S.C. section 1453(c) permits appeals from remand orders in CAFA cases. (Generally speaking, post-removal remand orders are not appealable.) 

For purposes of CAFA, and the diversity statute generally, a corporation is deemed a "citizen" of its state of incorporation and "the State where it has its principal place of business." 28 U.S.C. § 1332(c)(1). A corporate defendant's citizenship is key to whether diversity (complete or minimal) exists and whether CAFA's "local controversy" or "home state" exceptions apply. See id. § 1332(d)(2)(A), (d)(3), (d)(4).

In Hertz, the Supreme Court construed the phrase "principal place of business" and adopted the so-called "nerve center test":

We conclude that “principal place of business” is best read as referring to the place where a corporation's officers direct, control, and coordinate the corporation’s activities. It is the place that Courts of Appeals have called the corporation’s “nerve center.” And in practice it should normally be the place where the corporation maintains its headquarters—provided that the headquarters is the actual center of direction, control, and coordination, i.e., the “nerve center,” and not simply an office where the corporation holds its board meetings (for example, attended by directors and officers who have traveled there for the occasion).

Slip op. at 14. As the Court points out, this test does have the benefit, with many potential corporate defendants, of simplicity and predictability. Id. at 15-16. The Court also observes, however, that "under the 'nerve center' test we adopt today, there will be hard cases." Id. at 17. The opinion remands the action for further consideration of whether, applying the "nerve center" test, Hertz is a citizen of New Jersey rather than California. Id. at 19.

My original post on the Ninth Circuit's opinion in Hertz is here.

Two upcoming MCLE programs of interest

Here are two upcoming MCLE programs that sound really good.  Both are in San Francisco:

Outstanding Trial Work: Best Practices as Seen from the Bench, Recorder Roundtable, Wednesday, March 17, 2010, 9:00-11:00 a.m. (Commonwealth Club, San Francisco), featuring:

• Hon. Eugene Lynch, JAMS, U.S. District Court (retired)
• Hon. Suzanne Bolanos, S.F. Superior Court
• Hon. Franklin Bondonno, Santa Clara County Superior Court
• Hon. Winifred Smith, Alameda County Superior Court
• Hon. Ronald Quidachay, S.F. Superior Court
• Peter Keane, Professor and Dean Emeritus, Golden Gate University School of Law (Moderator)

California Supreme Court Trends, Bar Association of San Francisco, Litigation and Appellate Practice Sections, Wednesday, March 24, 2010, 12:00-1:30 (BASF Conference Center, San Francisco), featuring:

• Justice Carlos R. Moreno, California Supreme Court
• Justice Maria Rivera, First District Court of Appeal
• Honorable Joseph R. Grodin, Former Justice, California Supreme Court; Distinguished Emeritus Professor of Law, University of California, Hastings College of the Law
• Professor Gerald F. Uelmen, Professor of Law and Director, Edwin A. Heafey Jr. Center for Trial and Appellate Advocacy, Santa Clara University School of Law
• James J. Brosnahan, Morrison & Foerster, LLP (Moderator)

Appellate specialization MCLE credit is offered for the latter program.

Two votes for review in Davis v. FMCC

Which, unfortunately, is not enough.  Yesterday the Supreme Court denied the petition for review in Davis v. Ford Motor Credit Co., no. S179049.  Justices Kennard and Werdegar voted to grant review. 

We'll have to go a little longer without knowing what "unfair" means in consumer cases. Here is my original post on the Court of Appeal's opinion in Davis. 

Petition for review and other documents from Weinstat v. Dentsply

I have obtained copies of the following materials from Weinstat v. Dentsply Int'l, nos. A116248 and S180179:

• Petition for Rehearing in Court of Appeal (filed 01/22/10; denied 01/26/10)
• Petition for Review (filed 02/11/10)
• Depublication Request of American Financial Services Association and California Bankers Association (filed 02/24/10)
• Letter Supporting Review of American Financial Services Association and California Bankers Association (dated 02/24/10)
• Answer to Petition for Review (filed 03/03/10)
• Letter Supporting Review of the Product Liability Advisory Council (dated 03/04/10)

For more on the Weinstat case, see this blog post.

Oral argument set in attorney advertising case: Simpson Strong-Tie v. Gore

Last week, the Supreme Court scheduled oral argument in Simpson Strong-Tie Co. v. Gore, no. S164174. The argument will take place on Tuesday, April 6, 2010 at 9:00 a.m. in Los Angeles.  These are the issues on review:

(1) Which party bears the burden of persuasion with respect to the applicability of the anti-SLAPP exemptions set forth in Code of Civil Procedure section 425.17, subdivision (c)? (2) Does Code of Civil Procedure section 425.17, subdivision (c), exempt from anti-SLAPP protection an advertisement by a lawyer soliciting clients for a contemplated lawsuit?

The case is of interest to attorneys practicing in our area because the contemplated lawsuit was a class action and the attorney was seeking class representatives. The Court of Appeal's opinion is Simpson v. Strong-Tie Co. v. Gore, 162 Cal.App.4th 737 (2008), and here is my earlier blog post on the case.

Nine post-Tobacco II opinions

In preparation for our Rutter Group seminar last week, Will Stern and I compiled this list of the nine Court of Appeal opinions substantively construing Tobacco II:

Morgan v. AT & T Wireless Services, Inc., 177 Cal.App.4th 1235 (2009) (Second Appellate District, Division Four)  (no petition for review filed)

Kaldenbach v. Mutual of Omaha Life Ins. Co., 178 Cal.App.4th 830 (2009) (Fourth Appellate District, Division Three) (no petition for review filed)

Cohen v. DirecTV, Inc., 178 Cal.App.4th 966 (2009) (Second Appellate District, Division Eight) (rev. den. 02/10/10)

Princess Cruise Lines, Ltd. v. Superior Court, 179 Cal.App.4th 36 (Nov. 10, 2009) (Second Appellate District, Division Eight) (rev. den. 02/04/10)

In re Vioxx Class Cases, 180 Cal.App.4th 116 (Dec. 15, 2009) (Second Appellate District, Division Three) (petition for review filed 01/25/10, no. S179699) 

Weinstat v. Dentsply International, Inc., 180 Cal.App.4th 1213 (Jan. 7, 2010) (First Appellate District, Division Four) (petition for review filed 02/11/10, no. S180179)

In re Steroid Hormone Product Cases, 181 Cal.App.4th 145 (Jan. 1, 2010; mod. Feb. 8, 2010) (Second Appellate District, Division Four) (opinion; modification order) (petition for review filed 03/01/10, no. S180583)

McAdams v. Monier, Inc., 182 Cal.App.4th 174 (Feb. 24, 2010) (Third Appellate District)

Pfizer Inc. v. Superior Court (Galfano), 182 Cal.App.4th 622 (Feb. 25, 2010; pub. order Mar. 2, 2010) (Second Appellate District, Division Three)

Four of these (Morgan, Weinstat, Steroid Hormone Cases, and McAdams) generally favor the plaintiff's side, while the others generally favor the defendant.  The decisions are difficult to reconcile, although Will and I tried to during the Rutter seminar.  I'm starting to think that the Supreme Court will need to select a case to take up and elaborate on Tobacco II.

Thanks for coming!

Thanks to all who attended the Rutter Group seminar on 17200 practice this week.  I hope you found it useful.  I certainly did.

One of the attendees asked me about my new website, www.kraloweclaw.com.  It is under construction.  For now, I've set it to forward to www.uclpractitioner.com.  When the new site launches, I will announce it here.  As you can imagine, building a new website when I already have a comprehensive one was not at the top of the to-do list for my new law firm, but it will be launched eventually.

Let me also extend my sincere thanks to all the people who have emailed or called with congratulations and good wishes on my new venture.  I can't tell you how much I appreciate the support and confidence everyone has expressed.  And special thanks to my friends who sent flowers.  My office looks a lot like a flower shop right now. 

Pfizer v. Superior Court (Galfano) now published

Yesterday, the Court of Appeal published its opinion in Pfizer v. Superior Court (Galfano), ___ Cal.App.4th ___ (Feb. 25, 2010; pub. ord. Mar. 2, 2010), which originally was handed down as an unpublished opinion last week.  The opinion grants a writ of mandate reversing the trial court's order certifying a class, notwithstanding Tobacco II. 

The docket does not list any letters requesting publication.  It appears the panel simply reconsidered whether the opinion met the standards for publication and decided it did. 

Announcing The Kralowec Law Group

I am pleased to announce the formation of my new class action law firm, The Kralowec Law Group, as of March 1, 2010.  My updated contact information is to the left and below.

I will continue to represent plaintiffs in consumer, wage and hour, antitrust, and other class action cases, and to provide hourly consultation work and brief writing services at the trial and appellate levels.  Please do not hesitate to contact me if I can help with your case.  I would welcome the opportunity to discuss new cases and explore new co-counseling opportunities.

I am very excited about my new venture.  And of course, I have every intention of continuing to write this blog as I have done for the past six years.  I hope to see some of you at the Rutter Group program tonight in San Francisco and Wednesday night in Los Angeles. 

The Kralowec Law Group
188 The Embarcadero, Suite 800
San Francisco, CA 94105
Tel: (415) 546-6800
Fax: (415) 546-6801
Web: www.kraloweclaw.com
Email: [email protected]