The UCL Practitioner

Court of Appeal addresses improper communications with putative class members: Barriga v. 99 Cents Only Stores LLC

In Barriga v. 99 Cents Only Stores LLC, ___ Cal.App.5th ___ (Jun. 26, 2020), the Court of Appeal (Fourth Appellate District, Division Two), in a 2-1 decision, reversed an order denying class certification of certain wage and hour claims, holding that the trial court failed to apply the correct legal standard in ruling on plaintiff's motion to strike the defendant's "happy camper" declarations.  Because "an ongoing business relationship between the class opponent and putative class members—especially a current employer-employee relationship—is rife for abuse and coercion," the trial court should have "carefully scrutinized" the declarations "for actual or threatened abuse."  Slip op. at 4. 

The opinion contains a lengthy discussion of the problems with inappropriate pre-certification communications with proposed class members and the court's power to prevent or rectify them.  Id. at 28-47. 

A true appellate unicorn: City of Warren Police and Fire Retirement Sys. v. Natera Inc. (Updated)

There has been a unicorn sighting in San Mateo County.  The Court of Appeal (First Appellate District, Division Two) filed an opinion in a securities class action asserting claims under federal law that was not removed to federal court!  City of Warren Police and Fire Retirement System v. Natera Inc., ___ Cal.App.5th ___ (Feb. 28, 2020; pub. ord. Mar. 23, 2020). 

In other news, the Chief Justice issued a statewide order continuing all jury trials for 60 days, with a concomitant extension of the 5-year rule for all civil matters (and the 3-year rule for post-new trial and post-appeal cases).  She has also authorized all six appellate districts to extend filing deadlines as they see fit.  (At some point, it would be very helpful to law firm operations if the appellate courts moved to all-electronic systems for both filing and service copies of documents.)  See this post (evening of March 23) and this post (morning of March 24) from At the Lectern. As of this writing, the latest emergency order of the Los Angeles County Superior Court is available here.  Essentially, all courthouses are closed to the public until further notice.

UPDATE:  SCOCAblog has a very interesting post on the Chief Justice's authority (statutory, constitutional, and inherent) to issue a statewide order continuing all jury trials. 

Court of Appeal addresses American Pipe/China Agritech tolling: Montoya v. Ford Motor Co.

In Montoya v. Ford Motor Co., ___ Cal.App.5th ___ (Mar. 12, 2020), the Court of Appeal (Fourth Appellate District, Division Three) reversed a $58,000 judgment in an individual action for breach of the implied warranty of merchantability, finding the claim time-barred.  The trial court reasoned that the statute of limitations had been tolled during the pendency of two prior putative class actions, but the Court of Appeal disagreed. 

Plaintiff's four-year limitations period began to run on November 30, 2005, when he knew or should have known his Ford Excursion was a lemon.  Slip op. at 2.  A proposed class action was filed on April 21, 2006 and was pending for 199 days before class certification was denied.  Id.  Notice was not provided to the class.  See id.  Had that been the only pending class action, plaintiff's four-year limitations period would have run on approximately June 17, 2010 (November 30, 2009 plus 199 days).  But a second class action was filed on January 8, 2010.  This case settled in 2013 on a classwide basis, with notice to the class and an opt-out deadline of April 22, 2013.  Id. at 4-5.  Plaintiff opted out on April 19, 2013 and filed an individual action on June 14, 2013.  Id. at 5.  That action went to trial, and plaintiff won.  Id.

So far, this procedure seems totally normal.  The second case embraced the claims of all persons whose limitations periods had not yet run, including plaintiff, and the notice probably informed those class members that they if they opted out, they could pursue their claims individually.  (The opinion does not mention what the notice said about that, but such language is typical.)  The opt-out procedure exists precisely in order to permit the class members to file and pursue their own litigation if they wish to do so, so that they can control the litigation themselves and make their own decisions about settling or going to trial. 

The Court of Appeal, however, held that plaintiff was out of luck and not entitled to sue.  According to the Court, even if the first putative class action tolled his limitations period, the second putative class action did not have the same effect.  Hence, to preserve his right to pursue individual litigation, plaintiff would have had to file a separate action on top of the class case commenced on January 8, 2010, or sought to intervene and become a party to that action. The Court considered this outcome more "efficient" than the prospect of the exact same suit being filed in 2013. 

The Court began its analysis with an interesting chronological summary and discussion of American Pipe, Crown Cork, and China Agritech (U.S. Supreme Court decisions) as well as two California Supreme Court decisions, Jolly and Fireside Bank.  (This blog's 2007 coverage of Fireside Bank is at this link.)  The Court then explained its reasoning as follows:

From our canvass of the interaction between class actions and statutes of limitation as explained by both our federal and state Supreme Courts, we think the idea of tolling an individual action during the period of a second class action to be untenable.  Tolling during a second class action – particularly this second class action – defeats the objectives of judicial economy and efficiency that were the foundations of American Pipe.  It overlooks the problem of endless tolling that informed and suffused the China Agritech opinion.

Judicial economy and efficiency are defeated because second class action tolling reintroduces the problem of one-way intervention the 1966 amendments to Federal Rule 23 were intended to cure.  One-way tolling was an “abuse” of the system because it gave putative class members an incentive to wait and see what the trial court would do (or at least signal what it might do) with the ostensible class action before it.  If the merits looked bad, class members could bail on the class action and pursue their own actions elsewhere. 

And that is precisely what happened here.  The Crown Cork court’s anticipation was that a putative class member might receive notice a class action has not reached class status so the member would have the opportunity to opt out and bring an individual action.  But Montoya waited more than four years after Class Action 1 failed to be certified to bring his individual action.  Only when Class Action 2 ended with a proposed settlement that would have afforded Montoya – had he stayed in Class Action 2 – only a fraction of the recovery he would later obtain suing individually, did he finally sue.

Slip op. at 12-13. 

The problem with this reasoning is that no notice was given to the class in Class Action 1.  What is more, in Class Action 2, the parties agreed to resolve the action through certification of a settlement class, which was apparently expressly defined to include class members with (arguably) time-barred claims, and to afford all of those class members notice and opt-out rights.  As a result, the defendant waived the potential one-way intervention problem described in the opinion.  See Fireside Bank, 40 Cal.4th at 872.  Moreover, in the settlement context, class members are supposed to be considering whether they think they can get a better result on the merits by opting out.  That is not a one-way intervention problem, but a mechanism to protect the class.  If numerous class members opt out, that would signal to the trial court that the settlement might be unfair to the class, and it might not be approved at all. 

The Court of Appeal's reasoning flips the opt-out process on its head and could end up barring meritorious individual suits by opt-outs, even though a central purpose of the opt-out process is to enable such individual suits.   Also, it seems to me that by agreeing to certification of a settlement class embracing this specific plaintiff's claims, and by agreeing to a settlement notice that probably advised the class that if they opted out, they could bring an individual action, the defendant waived the right to assert, and/or was estopped from asserting, a statute of limitations defense in any such individual action. 

It will be interesting to see whether the Supreme Court shows any interest in this case.  Further guidance is plainly needed on the interplay between the five decisions canvassed in this opinion and to what extent principles from the three U.S. Supreme Court decisions apply in California. The only other published California opinion construing China Agritech is Fierro v. Landry’s Restaurant Inc., 32 Cal.App.5th 276 (2019), which the Court of Appeal found distinguishable.  Slip op. at 13.   It appears that no review petition was filed in Fierro in 2019.  In 2018, Fierro was a "grant and transfer," in which the Supreme Court granted review and directed the Court of Appeal to vacate its earlier opinion and "reconsider the cause" in light of China Agritech (docket).  That led to the 2019 opinion, with no further proceedings in the Supreme Court after that.

California Supreme Court victory: Frlekin v. Apple Inc.

To my dear, loyal readers:  I know I haven't been blogging regularly for some time, but I wanted to post today to share some excellent news.  I won my second California Supreme Court case!  In Frlekin v. Apple Inc., ___ Cal.5th ___ (Feb. 13, 2020), in a unanimous opinion by Chief Justice Cantil-Sakauye, the Supreme Court held that time spent by my clients undergoing security searches of their purses, bags, backpacks, and Apple-branded technology devices is compensable "hours worked" under Wage Order 7.

This decision has been a long time coming.  The case was filed in 2013 and class certification was granted in 2015.  We then lost on cross-motions for summary judgment on liability.  We appealed to the Ninth Circuit, and asked that Court to refer the question to the California Supreme Court, which it did in 2017.  Frlekin v. Apple, Inc., 870 F.3d 867 (9th Cir. 2017).  (The Ninth Circuit oral argument video can be viewed at this link, and the audio is at this link.)  After full briefing, I presented oral argument in the California Supreme Court on December 4, 2019 (viewable here). 

Many people provided assistance and support throughout this process, including my co-counsel Lee Shalov of McLaughlin & Stern in New York, my colleague Kate Rogers, and the authors of the amicus curiae briefs, namely, Gregg Adam (whose brief was quoted in the opinion), Aaron Kaufmann, Ari Stiller, and Dave Mara.  My sincere thanks to all.  We still have work to do in the case but this is a huge milestone. 

I have received calls from many reporters today.  The press coverage has been rather extensive, including articles in the San Francisco Chronicle, the Los Angeles Times, The Recorder, Bloomberg Law, and numerous other outlets.  From The Recorder: 

Plaintiffs' attorney, Kimberly Kralowec of San Francisco's Kralowec Law Group, praised the decision.  "The court carefully adhered to both the text and the purpose of the wage orders, which is to protect California employees and ensure employees are compensated for all time worked," she said.  "This is a very good day for employees working in California."

A very good day, indeed. 

Class actions and the "five-year" rule: Rel v. Pacific Bell Mobile Servs.

In Rel v. Pacific Bell Mobile Services, ___ Cal.App.5th ___ (Mar. 29, 2019), the Court of Appeal (First Appellate District, Division Five) reviewed the dismissal of a putative class action under the "five-year" rule (Code Civ. Proc. §583.310). The panel considered, among other issues, the interplay between the dismissal statutes and interim "death knell" appeals from orders denying class certification.

Supreme Court reconfirms importance of wage and hour class actions: Troester v. Starbucks Corp.

Last week, the Supreme Court held that in California, employers must pay for "any" and "all" time their employees work, and they cannot escape this obligation by claiming that the time is "de minimis."  Troester v. Starbucks Corp., ___ Cal.5th ___ (July 26, 2018).  (Scott Leviant has more on the wage and hour aspects of the decision.  Copies of the briefs, including the amicus brief I co-wrote with Ari Stiller for CAOC and CELA, are available here.)

In the 1940s, the U.S. Supreme Court suggested that a "de minimis" defense to FLSA wage claims might exist under federal law, but 70 years later, the California Supreme Court found the reasoning behind those comments outdated.  For one thing, the 1960s saw the advent of the class action: 

Two additional considerations reinforce our reluctance to fully adopt Anderson's reasoning as a matter of state law. First, the modern availability of class action lawsuits undermines to some extent the rationale behind a de minimis rule with respect to wage and hour actions.  The very premise of such suits is that small individual recoveries worthy of neither the plaintiff’s nor the court’s time can be aggregated to vindicate an important public policy.  As we explained in Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, a class action suit involving a 4 cents per gallon surcharge on gasoline customers using credit cards:  “Setting aside the fact that class members who were repeat customers might be entitled to recover far more than the minimal 80-cent damage figure noted by the trial court, it is firmly established that the benefits of certification are not measured by reference to individual recoveries alone.  Not only do class actions offer consumers a means of recovery for modest individual damages, but such actions often produce ‘several salutary by-products, including a therapeutic effect upon those sellers who indulge in fraudulent practices, aid to legitimate business enterprises by curtailing illegitimate competition, and avoidance to the judicial process of the burden of multiple litigation involving identical claims.’ ”  (Id. at p. 445.)  As one Court of Appeal observed in a case involving alleged fraudulent practices against consumers, “[i]n this age of the consumer class action this maxim [de minimis non curat lex] usually has little value.”  (Harris v. Time, Inc. (1987) 191 Cal.App.3d 449, 458.)  The same is true of employee class actions.

Slip op. at 17-18 (citing Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680 (1946)).  For another, timekeeping technology is far more advanced now than it was in the 1940s: 

Second, many of the problems in recording employee work time discussed in Anderson 70 years ago, when time was often kept by punching a clock, may be cured or ameliorated by technological advances that enable employees to track and register their work time via smartphones, tablets, or other devices.  We are reluctant to adopt a rule purportedly grounded in “the realities of the industrial world” (Anderson, supra, 328 U.S. at p. 692) when those realities have been materially altered in subsequent decades.

Id. at 18.  And what some employers might want to call "de minimis" is really not for many workers:

An employer that requires its employees to work minutes off the clock on a regular basis or as a regular feature of the job may not evade the obligation to compensate the employee for that time by invoking the de minimis doctrine.  As the facts here demonstrate, a few extra minutes of work each day can add up.  According to the Ninth Circuit, Troester is seeking payment for 12 hours and 50 minutes of compensable work over a 17-month period, which amounts to $102.67 at a wage of $8 per hour.  That is enough to pay a utility bill, buy a week of groceries, or cover a month of bus fares.  What Starbucks calls “de minimis” is not de minimis at all to many ordinary people who work for hourly wages.

Id. at 19-20. 

American Pipe tolling issue pending in U.S. Supreme Court: China Agritech, Inc. v. Resh

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. 

The following passage explains the panel's reasoning:

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). 

New opinion expected today on appellate standing: Hernandez v. Restoration Hardware, Inc. (Updated)

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.

When the opinion is posted, it should be available at this link:

• 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. 

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.  

In so holding, the panel distinguished Microsoft Corp. v. Baker, 137 S. Ct. 1702 (2017) (discussed in this blog post): 

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."

Ninth Circuit addresses appealability of class certification orders: Bates v. Bankers Life and Casualty Co.

In Bates v. Bankers Life and Casualty Co., ___ F.3d ___ (9th Cir. Feb. 24, 2017), the Ninth Circuit dismissed, for lack of jurisdiction, an appeal from an order striking class allegations from the complaint: 

There are only two procedural avenues for appealing an order striking class allegations made under Federal Rule of Civil Procedure 23: (1) asking the district court to certify an order for interlocutory review pursuant to 28 U.S.C. § 1292(b); or (2) filing a petition for permission to appeal pursuant to Federal Rule of Civil Procedure 23(f). See Plata v. Davis, 329 F.3d 1101, 1107–08 (9th Cir. 2003); Kamm v. Cal. City Dev. Co., 509 F.2d 205, 206 (9th Cir. 1975). ....  Plaintiffs did not use either of these procedural avenues, and we therefore lack jurisdiction to hear their challenge to the order striking their class allegations.

Slip op. at 6-7.   

If pending H.R. 985 passes, this would all change.  Among other attacks on the class action process, the bill would make all orders either denying or granting class certification immediately appealable as of right.  That would automatically add at least a two-year delay in the middle of almost every class action.  (Something similar was proposed in California some time ago, but never made it out of committee.)  Please contact your representative and tell him or her to vote no on H.R. 985.  For those on the defense side, consider the fact that curtailing class actions, which is the goal of this bill, would be bad for your law practice.  The fewer class actions, the fewer cases for clients to hire you to defend. 

Ninth Circuit also considers disqualification of class counsel: Radcliffe v. Hernandez

First of all, I want to encourage everyone to get to the polls today and vote!  I certainly will be voting today (Go Hillary!).

When I was reading the Walker opinion for my post yesterday, I realized the Ninth Circuit had handed down an opinion on a similar subject earlier this year (March) that I hadn't covered yet.

In Radcliffe v. Hernandez, 818 F.3d 537 (9th Cir. 2016), the court considered whether the attorneys who had included improper promises concerning incentive awards in a class action settlement agreement, thereby creating a conflict of interest for class counsel between the class representatives and the unnamed class members, should be disqualified from continuing to represent the class.  In 2013, the Ninth Circuit had reversed final approval of the settlement because of the incentive award provisions.  See Radcliffe v. Experian Information Solutions, Inc., 715 F.3d 1157 (9th Cir. 2013) (briefly discussed in this blog post). 

On remand, the objectors who had obtained that reversal moved to disqualify the firms previously appointed as lead counsel, who had negotiated the settlement with the problematic provisions.  The district court denied the motion, but certified the questions to the Ninth Circuit, which granted permission to appeal.  818 F.3d at 540-41.  The Ninth Circuit affirmed, holding that "California law does not require automatic disqualification in class action cases."  Id. at 541.

In so holding, the Court considered a number of California decisions involving conflicts in non-class cases, but concluded that none of these:

fits the circumstances of the lawyer who represents a class of plaintiffs whose interests may in some ways be adverse to each other, but all of whose interests are adverse to the defendant. In a class action, conflicts often arise not because an attorney simultaneously represents litigation adversaries but because they simultaneously represent different members of the same class who develop divergent interests regarding how to prevail on their shared claims. Thus, in Radcliffe I, we explained that the conditional incentive award was improper because it “undermined [the named plaintiffs'] ability to ‘fairly and adequately protect the interests of the class.’ ”  Radcliffe I, 715 F.3d at 1165 (quoting Fed. R. Civ. Pro. 23(a)(4)). “This requirement is rooted in due-process concerns—‘absent class members must be afforded adequate representation before entry of a judgment which binds them.’ ” Id. (quoting Hanlon v. Chrysler Corp., 150 F.3d 1011, 1020 (9th Cir. 1998)).  These concerns with adequate representation and due process for absent party members are simply not present in individual plaintiff suits. And because the California Supreme Court has never discussed the automatic disqualification rule in the context of class actions, it also has never been required to confront the ethical issues and conflicts of interest that are unique to class action cases. Given this vacuum, we are not willing to assume that California courts would apply the same disqualification rules to a class action case as they do in individual plaintiff cases.

Id. at 544-45.  In particular, given the specific type of conflict that the settlement agreement created, disqualification was not warranted:

[I]n this case the district court could reasonably conclude that the conflict of interest was appropriately cured when we rejected the settlement agreement that contained the improper conditional incentive award. This conflict was not inherent to the relationship between Hernandez Counsel [i.e., class counsel] and the rest of the class but rather, as in Rodriguez, resulted from a particular provision in an agreement that was later held invalid.

Id. at 546.  The opinion goes on to hold that class counsel remained adequate to represent the class and should not be replaced by objectors' counsel.  Id. at 547-49. 

The opinion concludes:

We previously found that Hernandez Counsel created a significant conflict of interest between themselves, their clients, and the rest of the class, and nothing in the present order diminishes or qualifies that holding. We are not convinced, however, that the conflict we found requires automatic disqualification of class counsel. We believe that, given the unique ethical and due process concerns involved in class actions, district courts must have the discretion to address attorney representation and disqualification issues based on the details of each case, and we further believe the California Supreme Court would agree. Accordingly, we hold that the district court did not abuse its discretion in denying White Counsel's motion to disqualify Hernandez Counsel and to be appointed as class counsel, and granting Hernandez Counsel's cross-motion to be appointed as class counsel.

Id. at 549.

New opinion considers attorney-client conflicts in class action context: Walker v. Apple, Inc.

In Walker v. Apple, Inc., ___ Cal.App.5th ___ (Sept. 28, 2016; pub. ord. Oct. 28, 2016), the Court of Appeal (Fourth Appellate District, Division One) affirmed an order disqualifying a law firm from serving as class counsel in a wage and hour action against Apple. 

The law firm represented a certified class in one case against Apple, and the putative class in a second, later-filed case against Apple.  Apple moved to disqualify the firm in the second case on the ground that a store manager, who was an unnamed member of the certified class in the first case, would be a critical adverse witness in the second case.  Slip op. at 3-6.  The trial court granted the motion, and the Court of Appeal affirmed.  It reasoned, first of all, that the order granting class certification in the first case rendered this particular unnamed class member (but not necessarily all unnamed class members) the firm's client for conflicts purposes.  Id. at 10-15. 

Then, the Court concluded that Apple's evidence supported the trial court's holding that in order to advance the class claims in the second case, the firm would have to cross-examine this unnamed class member in a manner that would conflict with her "employment interests."  Id. at 15-20.  This part of the analysis was highly dependent on the particular facts of the second class case, including the specific arguments to be presented by both sides on liability.  Given those facts, automatic disqualification was warranted.  Id. at 22-24.

The opinion recognizes that not all unnamed class members automatically become the firm's clients for conflicts purposes (as opposed to other purposes, such as the rule of ethics prohibiting opposing counsel from communicating with represented parties, and the attorney-client privilege).  See id. at 10-11.  The conclusion that the specific unnamed class member/witness should be considered a firm client for conflicts purposes turned on the fact that the two cases were factually related as well as "additional undisputed evidence regarding [the class member's] identity and likely role in this case."  Id. at 11. 

Court of Appeal considers stipulations to temporary judges in class action context: Luckey v. Superior Court

In Luckey v. Superior Court (Cotton On USA, Inc.), ___ Cal.App.4th ___ (July 22, 2014), the parties stipulated to appointment of a temporary judge to rule on the motions for preliminary and final approval of a class action settlement.  (The proposed temporary judge was the mediator retained to assist in negotiating the settlement.) The trial court refused to approve the stipulation.  The plaintiff challenged this ruling by filing a writ petition. Slip op. at 2, 8.

The Court of Appeal (Second Appellate District, Division Three) declined to disturb the trial court's ruling, holding that until a class is certified, the named plaintiff "has no authority to consent to a temporary judge on behalf of the putative class."  Id. at 2.  The Court reasoned that the absent class members were not "parties litigant" within the meaning of the provision of the California Constitution authorizing stipulations to temporary judges:

[W]hile Luckey and [defendant] Cotton On were the only “parties litigant” at the time of the stipulation to the temporary judge, they were also the only parties who could be bound by such a stipulation.  As the conceded purpose of the stipulation was to bind all putative class members to the stipulation, and they could not be bound until they had been given notice and an opportunity to appear, the stipulation was ineffective.  The state Constitution provides that, for a stipulation to a temporary judge to be effective, that stipulation must be made by the parties litigant.  In a pre-certification class action, the parties litigant have not yet been identified; thus, no such stipulation can be effectively made.

Slip op. at 22-23 (footnotes omitted).

On a personal note, I completed my office move at the end of June and my new physical and mailing address is as follows:

The Kralowec Law Group
180 Montgomery Street, Suite 2000
San Francisco, CA 94104
Tel: 415-546-6800

I am sharing office space with Schneider Wallace Cottrell Konecky LLP, which has been great so far. 

U.S. Supreme Court denies cert. in cy pres case: Lane v. Facebook

On Monday, November 4, 2013, the U.S. Supreme Court denied the objectors' cert. petition in the Lane v. Facebook cy pres case, after relisting the case twice.   Marek v. Lane, no. 13-136.  For more on Lane, see this blog post.

Chief Justice Roberts filed a 4-page "statement respecting the denial of certiorari," which reads, in part:

I agree with this Court’s decision to deny the petition for certiorari. Marek’s challenge is focused on the particular features of the specific cy pres settlement at issue. Granting review of this case might not have afforded the Courtan opportunity to address more fundamental concerns surrounding the use of such remedies in class action litigation, including when, if ever, such relief should be considered; how to assess its fairness as a general matter; whether new entities may be established as part of such relief; if not, how existing entities should be selected; what the respective roles of the judge and parties are in shaping a cy pres remedy; how closely the goals of any enlisted organization must correspond to the interests of the class; and so on. This Court has not previously addressed any of these issues. Cy pres remedies, however, are a growing feature of class action settlements. See Redish, Julian, & Zyontz, Cy Pres Relief and the Pathologies of the Modern Class Action: A Normative and Empirical Analysis, 62 Fla. L. Rev. 617, 653-656 (2010). In a suitable case, this Court may need to clarify the limits on the use of such remedies.

Statement at 4 (hyperlink added). What the Chief Justice seems to be suggesting is that the objectors did not properly frame the issue in their cert. petition.

Ninth Circuit shuts the door on "pick-off" attempts: Diaz v. First American Home Buyers Protection Corp.

In Diaz v. First American Home Buyers Protection Corp., ___ F.3d ___ (9th Cir. Oct. 4, 2013), the Ninth Circuit held that "an unaccepted Rule 68 offer that would fully satisfy a plaintiff’s claim is insufficient to render the claim moot."  Slip op. at 3.

This shuts the door to "picking off" the class representative—a door some believed was left open by Genesis Healthcare Corp. v. Symczyk, 133 S. Ct. 1523 (2013).  As the Diaz court observed, the Supreme Court did not decide the issue in that case.  Slip op. at 8 (citing Genesis Healthcare, 133 S. Ct. at 1528-29).  The substantive analysis in Diaz relies heavily on Justice Kagan's dissent, however, which did address it.  Diaz, slip op. at 10-15.

Off topic: Save the San Francisco Law Library: public hearing next Wednesday

There will be a public hearing next Wednesday, March 27, 2013 at 10:00 a.m. at San Francisco City Hall to discuss whether the City will provide adequate space for the San Francisco Law Library. A couple of weeks ago, the library filed suit against the City over this problem. 

I'm quoting the library's press release in full below.  This is very important; if you are in San Francisco please consider participating.  The library director, Marcia Bell, asks that we all RSVP to her if we can attend.  See below for details.

On March 27 at 10 a.m. in room 250, the Board of Supervisors Budget & Finance Committee is scheduled to consider a proposal to lease only 20,000 square-feet of space at 1200 Van Ness Avenue. The City is proposing to move the Library here eventually after the Veterans Building closes in May.
 
The Law Library had proposed leasing 30,000 square-feet as the absolute minimum the Library needs to function, house its collection, and effectively serve the public. The City proposal is grossly inadequate.
 
Please come on March 27 to City Hall to speak for a minute or two in support of the Library and explain why it needs appropriate funding and space to preserve public access to legal resources. The hearing will be held in Room 250, starting at 10 a.m.
 
This is the first ever public hearing about the Law Library’s space.  Given the lack of understanding and interest on the part of the city up until this point, this hearing could make all the difference. The supervisors really need to hear from the people who need and care about the library.
 
If you or anyone else is interested in attending this meeting, please email the Law Library director, Marcia Bell, at marcia.bell @ sfgov.org so we can put you on the list and provide further details.  We will reconfirm the time and location.  We are anxious to get the word out to as many people as possible—please pass the info along to any one you can. 

For additional information about the Law Library's fight for sufficient space and pending litigation against the City, please visit the Library’s homepage at www.sflawlibrary.org.

Questions? Please call us at 415-554-6821.

New opinion analogizes to class communications in striking down gag order: San Francisco Unified Sch. Dist. ex. rel. Contreras v. First Student, Inc.

In San Francisco Unified School District ex. rel. Contreras v. First Student, Inc., ___ Cal.App.4th ___ (Feb. 19, 2013), the Court of Appeal (First Appellate District) reversed an order prohibiting the named plaintiffs from communicating with the defendant's current employees. 

This was a False Claims Act case, not a class action, but the opinion has this passage of interest:

Paragraph 2 of the January 2012 order also implicates the individual plaintiffs’ First Amendment rights.  “Orders which restrict or preclude a citizen from speaking in advance are known as ‘prior restraints,’ and are disfavored and presumptively invalid.  Gag orders on trial participants [for example] are unconstitutional unless (1) the speech sought to be restrained poses a clear and present danger or serious and imminent threat to a protected competing interest; (2) the order is narrowly tailored to protect that interest; and (3) no less restrictive alternatives are available.”  (Hurvitz v. Hoefflin (2000) 84 Cal.App.4th 1232, 1241, fns. omitted.)  These principles have been applied to orders that restrict parties’ communications with other parties or witnesses.  In Maggi v. Superior Court, the court held that orders restricting those plaintiffs’ counsel’s contacts with witnesses (and potential clients) was an unconstitutional prior restraint unjustified by a discovery violation.  (Maggi v. Superior Court (2004) 119 Cal.App.4th 1218, 1223–1226.)  “Absent a ‘protected competing interest’ on a level equivalent to the constitutional guarantee of free speech, orders limiting speech are not appropriate sanctions.”  (Id. at p. 1226.)  In Bernard v. Gulf Oil Co., the United States Court of Appeal for the Fifth Circuit held that an order restricting communications by named plaintiffs and their counsel with potential class members was an unconstitutional prior restraint.  (Bernard v. Gulf Oil Co. (1980) 619 F.2d 459, 463, 477.)  The Supreme Court affirmed on nonconstitutional grounds, while acknowledging the constitutional concern.  (Gulf Oil Co. v. Bernard (1981) 452 U.S. 89, 103–104 [“[a]lthough we do not decide what standards are mandated by the First Amendment in this kind of case, we do observe that the order involved serious restraints on expression”]; see also Parris v. Superior Court (2003) 109 Cal.App.4th 285, 290 [precertification communication with potential class members is constitutionally protected speech].)  These free speech concerns support the conclusion that rule 2-100 must not be construed in a manner that will unduly interfere with the right of parties to communicate with one another absent compelling evidence of abuse, which we do not find present here.

Slip op. at 29-30 (footnote omitted) (emphasis added).

The Gulf Oil case is an important one in this area of practice but hasn't been cited all that often by California's appellate courts.

New podcast of interest: "Class Re-Action"

Scott Leviant of The Complex Litigator has launched a new podcast, "Class Re-Action." 

The inaugural episode of the podcast is now available through this link and through iTunes.  It runs approximately one hour and features attorneys Tim Blood of Blood, Hurst & O'Reardon, Michael Singer of Cohelan, Khoury & Singer, and Tom Kaufman of Sheppard Mullin.

Scott expects this to be a regular series, complete with CLE credit for listening. Congratulations to him on this new venture.  It sounds like it will be very interesting.

New class appealability opinion: Aleman v. AirTouch Cellular

As reported in the Bailey Class Action Daily, the Court of Appeal (Second Appellate District, Division Two) has handed down a new opinion addressing appealability of orders denying class certification.  Aleman v. AirTouch Cellular, ___ Cal.App.4th ___ (Sept. 20, 2012).  

The relevant discussion appears at pp. 29-31 of the slip opinion.  

Seventh Circuit construes Smith v. Bayer Corp.: Smentek v. Dart

In Smentek v. Dart, ___ F.3d ___ (7th Cir. Jun. 19, 2012), the Seventh Circuit (Judge Posner) construed the U.S. Supreme Court's opinion last year in Smith v. Bayer Corp., 131 S. Ct. 2368 (2011).  The question considered was whether, under Smith, federal judges must afford "comity" to each other's orders denying class certification.  The answer was no:

Whatever the scope of the Supreme Court’s current concept of comity, the defendants’ argument that Smith v. Bayer Corp. adopted a rule of comity in class action suits that precludes granting class certification in a copycat class action must be rejected ....

The rule urged by the defendants in this case that the denial of class certification bars the certification of the same or a similar class in a suit by a member of the same class as the previous suit ... would contradict the holding of Smith v. Bayer Corp., which is that a class member who did not become a party to the previous parallel class action is not precluded from seeking class certification in his class action. ....

We are left with the weak notion of “comity” as requiring a court to pay respectful attention to the decision of another judge in a materially identical case, but no more than that even if it is a judge of the same court or a judge of a different court within the same judiciary. We emphasize, however, the qualification in “materially identical.” Even two class actions involving the same class may differ materially, for example in the suitability of the class representative or the adequacy of class counsel, and where they do the judge in the second, or third, or nth class action is on his own. This is not such a case; nevertheless the district judge gave plausible reasons for her disagreement with the judges in the two previous Cook County dental cases. Can more be required? The defendants’ claim that she was bound by the decisions of the other judges just because those decisions preceded and were contrary to her decision has no basis in law and flouts the principle that a district court decision does not have precedential effect. Camreta v. Greene, 131 S. Ct. 2020, 2033 n. 7 (2011); Wirtz v. City of South Bend, 669 F.3d 860, 862-63 (7th Cir. 2012). The defendants would have such decisions treated not as mere precedents but as super-precedents that no court lacking appellate authority could question.

The district judge’s grant of class certification is therefore affirmed.

Slip op. at 6, 7, 8-9 (emphasis added).

[via]

Seventh Circuit holds you can pick off the class reps: Damasco v. Clearwire Corp.

In August, I reported on a new Ninth Circuit opinion holding that a defendant may not defeat a class action by "picking off" the class representatives.  Pitts v. Terrible Herbst, Inc., 653 F.3d 1081 (9th Cir. 2011).

In the Seventh Circuit, however, it appears the defendant can "pick off" the class representive -- simply by extending a full-relief settlement offer before the class certification motion is filed.  Damasco v. Clearwire Corp., ___ F.3d ___ (7th Cir. Nov. 18, 2011).  The solution to the obvious problem this creates?  File the class certification motion simultaneously with the complaint: 

A simple solution to the buy-off problem that Damasco identifies is available, and it does not require us to forge a new rule that runs afoul of Article III: Class-action plaintiffs can move to certify the class at the same time that they file their complaint. The pendency of that motion protects a putative class from attempts to buy off the named plaintiffs. See Primax, 324 F.3d at 546-47. 

Slip op. at 9 (emphasis added). 

And if discovery is needed to draft that motion?  Well of course the district court will postpone the hearing to allow it:

Damasco argues that this solution would provoke plaintiffs to move for certification prematurely, before they have fully developed or discovered the facts necessary to obtain certification. See 5 MOORE’S FEDERAL PRACTICE § 23.64[1][b], at 350 (3d ed. 2011). But this objection is unpersuasive. If the parties have yet to fully develop the facts needed for certification, then they can also ask the district court to delay its ruling to provide time for additional discovery or investigation.

Id. (emphasis added).  In other words, for cases within the jurisdictional bounds of the Seventh Circuit, it will be necessary to file the complaint, the class certification motion, and a motion to delay the ruling on that motion -- all at the same time -- or risk getting involuntarily "picked off."

Oregon Supreme Court affirms consumer fraud class action judgment: Strawn v. Farmers Ins. Co.

In another decision of interest from May, the Oregon Supreme Court affirmed a judgment for compensatory damages (but reversed the punitive damages award) following a jury verdict in a common-law consumer fraud class action.  Strawn v. Farmers Ins. Co., ___ P.3d ___, 2011 WL 1886283 (Or. May 19, 2011).

The opinion's discussion of classwide reliance in a common-law fraud case is of particular interest. 

New opinion addresses class counsel conflicts of interest: Kullar v. Foot Locker Retail, Inc.

In Kullar v. Foot Locker Retail, Inc., ___ Cal.App.4th ___ (Jan. 18, 2011), the Court of Appeal (First Appelate District, Division Three) addressed conflict of interest issues arising in the context of a class action settlement with objectors.  Both The Complex Litigator and the Bailey Class Action Daily have more detailed posts on the opinion.

Federal developments of interest: Philip Morris USA Inc. v. Scott; Sullivan v. DB Investments, Inc.; Wal-Mart Stores, Inc. v. Dukes

On Friday, September 24, 2010, U.S. Supreme Court Justice Antonin Scalia entered an order staying enforcement of a $240 million judgment entered in Louisiana state court in a class action against the tobacco industry.  The order states that the Supreme Court is likely to grant the anticipated petition for a writ of certiorari to review the defendants' federal due process arguments, which appear to attack many aspects of class procedure.  Philip Morris USA Inc. et al. v. Scott, no. 10A273.  See this post at SCOTUSblog for a more detailed discussion of the order.  SCOTUSblog also has links to the stay application (a large file), the opposition, and the reply.

A month ago today, the Third Circuit granted en banc rehearing in Sullivan v. DB Investments, Inc., 613 F.3d 134 (3d Cir. 2010), the class action settlement case discussed in this blog post.  See Sullivan v. DB Investments, Inc., ___ F.3d ___, 2010 WL 3374167 (3rd Cir. Aug 27, 2010) (granting rehearing and vacating the panel opinion).  Sullivan is an antitrust class action for price-fixing in the diamond industry. 

In Wal-Mart Stores, Inc. v. Dukes, no. 10-277, the response to the cert. petition will be due on October 25, 2010, according to the docket.  Both sides have submitted consents to the filing of amicus briefs, and three amicus briefs supporting Wal-Mart have been filed so far. 

Recently-published UCL res judicata opinion: Fireside Bank Cases

About three weeks ago, the Court of Appeal (Sixth Appellate District) published a new opinion called Fireside Bank Cases, ___ Cal.App.4th ___ (Jul. 28, 2010; pub. ord. Aug. 25, 2010).   You may remember the Supreme Court's opinion in this same case, from April 2007, addressing the rule against one-way intervention in class action litigation. Fireside Bank v. Superior Court (Gonzalez), 40 Cal.4th 1069 (2007). The case has continued to wend its way through the lower courts, and the latest opinion addresses another fascinating procedural topic:  claim preclusion.

The original named plaintiff took out a car loan from Fireside Bank and later defaulted.  Fireside repossessed her vehicle, then filed suit against her for the deficiency.  She filed a class action cross-complaint alleging that Fireside's redemption notice violated the Rees-Levering Motor Vehicle Sales and Finance Act (Civ. Code §§ 2981–2984.4) by misstating the amount necessary to cure.  According to the cross-complaint, Fireside had a uniform practice of seeking and obtaining improper deficiency judgments against borrowers.  For this wrongful conduct, the cross-complaint sought classwide UCL restitution of all sums Fireside had collected on those deficiency judgments.  Slip op. at 1-2, 8. 

The plaintiff then moved both for judgment on the pleadings and class certification.  The trial court granted both motions simultaneously, ruling on the merits question before notice to the class.  This led the Supreme Court to reverse the judgment, citing the one-way intervention rule.  Id. at 2-3. 

In December 2007, after remand to the trial court (and apparently after class notice), Fireside Bank moved to strike all allegations from the cross-complaint (as well as similar allegations in a second cross-action filed while the original case was pending and later coordinated with it, but in which class certification had not yet been granted) "insofar as they [sought] to overturn or bar Fireside from enforcing deficiency judgments it has previously obtained."  Id. at 3-4.  Fireside argued that those judgments operated as res judicata, barring the class claims (although not the named plaintiffs' claims, which did not attack any final judgment because none had yet been entered) to the extent they sought to undo the judgments' effects.  Id. at 4.

The trial court granted this motion and (in the original case) entered judgment dismissing the claims of all class members against whom a deficiency judgment had been entered (referred to in the opinion as "judgment debtors").  The plaintiffs appealed, and the Court of Appeal affirmed.  Id. at 4, 6. 

Observing that "that the class setting of the order greatly complicates the required legal analysis," the Court first explained that the motion was not brought, or granted, on the basis that all of the elements of res judicata had been, or could be, either proven or disproven classwide.  Id. at 7-8.  Rather:

the issue was joined over one question: whether the judgment-debtor class members were entitled to relief en masse on the theory that the UCL rendered the judgments essentially irrelevant. Their argument—which is also their central argument on appeal—proceeds as follows: (1) The UCL empowers trial courts to “make such orders or judgments . . . as may be necessary to prevent the use or employment by any person of any practice which constitutes unfair competition . . . or as may be necessary to restore to any person in interest any money or property, real or personal, which may have been acquired by means of such unfair competition.” (Bus. & Prof. Code, § 17203.) (2) Fireside secured the judgments in question by means of unfair competition, i.e., violations of the Rees-Levering Act. (3) Any sums collected on the judgments were therefore also the products of unfair competition. (4) Therefore the court has the power to restore such sums to plaintiffs despite the judgments in Fireside’s favor, and to make any orders needed to accomplish that result.

Id. at 8.  The Court of Appeal did not accept that reasoning, holding that res judicata principles apply in UCL cases just as they do in any other type of case.  Id. at 9-11.  The Court explained:

We find even less cause to suppose that the Legislature intended to free UCL litigants of the constraints ordinarily imposed on civil plaintiffs by the law of judgments. Cross-complainants have pointed to nothing in the legislative history that suggests such an idea was even remotely present in the legislative mind. Giving a prior judgment its normal effect in a UCL action does not “imply” an “exception” to the act or fashion a “safe harbor” from it. It simply recognizes a defense that is available to every civil defendant when the facts support it. We therefore reject cross-complainants’ contention that the court below was empowered by the UCL to grant class-wide relief to judgment debtors without a factual showing of grounds to avoid the judgments against them. Since no other basis for relief on their behalf was ever suggested, the court did not err by concluding that the UCL afforded no basis for the class-wide affirmative relief they sought in this class action.

Id. at 11 (emphasis added). 

The Court of Appeal went on to explain that "[t]he real foundation for the order disposing of [the judgment debtors'] claims appears to have been the absence of any demonstrated basis for their class-wide adjudication," and that nothing in the order would prevent those class members from challenging the judgments in later, individual actions, in which the elements of res judicata could be litigated on the merits. Id. at 11-12.   "All that is known is that Fireside obtained judgments against the affected class members, and that these judgments may furnish a defense to any claims those members might bring against Fireside. .... [T]he dismissal of the judgment debtors’ claims did not reflect any disposition of their individual rights, if any, to avoid the effects of the judgments."  Id. (emphasis in original).

"Defending the Class Action Trial"

Monday's Daily Journal had an interesting Perspective article, "Defending the Class Action Trial" (link not available), by attorney James Donato of Shearman & Sterling in San Francisco.  It begins:

Class action trials. It is probably safe to say that more lawyers have seen a double rainbow or climbed Mt. Everest than have tried a class action case. Most practice guides offer little or no commentary on the unique trial issues that can arise in class cases.

The article goes on to discuss (from a defense perspective, as the title promises) some of those issues, including "how to explain the class action to the jury," "the absence of a strong plaintiff representative at trial," and "the predominance of live witnesses on the defense side."  For plaintiffs' attorneys, the lesson is to be sure you make a strong showing of aggrieved plaintiff-side witnesses. 

New opinion addresses responsibility of class counsel post-judgment: Barboza v. West Coast Digital GSM, Inc.

In Barboza v.  West Coast Digital GSN, Inc., ___ Cal.App.4th ___ (Nov. 19, 2009), the Court of Appeal (Second Appellate District, Division Four) posed the question on appeal this way:

What are the obligations of class counsel when he learns that the defendant in the class action he is prosecuting has ceased operations, sold its assets to a third party, and intends to file for bankruptcy?

Slip op. at 1. Obviously, this means that the ruling the Court is about to announce applies only to male class counsel.  (Seriously, aren't we beyond the generic "he" by now?)

The opinion goes on:

In the case before us, counsel obtained a stipulated default and a default judgment that included more than $4 million in aggregate damages for the class, plus more than $1 million in prejudgment interest. So far, so good. But counsel then asserted that his job would be completed once his motion for attorney fees was heard, i.e., that he had no obligation to enforce the judgment on behalf of the class. The trial court disagreed. It ruled that “by assuming the responsibility of pursuing claims on behalf of the class, class counsel assumed the obligation to pursue it until the end (i.e., enforcement of the judgment) and not just until judgment.” Based upon the principles guiding class actions, we agree that class counsel’s obligations to the class do not end with the entry of judgment, and hold that class counsel’s obligations continue until all class issues are resolved, which may include enforcement of the judgment.

Id.  Or perhaps the Court meant to imply that female class counsel would not abandon the class in such a manner.  That must be it. 

(I should add that I have heard, through the grapevine, that the conduct of class counsel in this case was not nearly so egregious as the opinion makes it seem.  I was told that the case was filed in 2004, that five years of hard-fought litigation ensued, including a successful appeal from the trial court's original order denying class certification, and that plaintiffs' counsel eventually obtained a default judgment (not a settlement) of nearly $6 million, after spending tens of thousands of dollars in expert witness fees to establish damages (and other expenses, none of which has been recovered).  The reason plaintiffs' counsel sought to be relieved from any further duties was that the defendant had no assets and they believed there was nothing to collect — not even their own fees or out-of-pocket costs.)

In any event, the Court of Appeal held that the "general common law rule" that "the duties of an attorney employed to conduct litigation end upon entry of judgment in the absence of an agreement to the contrary" — and do not include enforcement of the judgment — does not apply in class action cases.  See id. at 6-8.  Class actions are different from normal litigation, the Court explained:

[U]nlike situations in which the litigant has retained an attorney to conduct litigation, where the litigant and the attorney agree upon the scope of the engagement, and their rights and duties are governed by their agreement, in class actions, where there is no agreement with absentee class members to define the scope of the engagement, class counsel must represent all of the absent class members’ interests throughout the litigation to the extent there are class issues, and it is the duty of the trial court to ensure at every stage of the proceeding that counsel is adequately representing those interests.

Slip op. at 7-8 (emphasis added).   Because "it seems unlikely (based upon counsel’s own assertions) that there are sufficient assets to pay each class member what is owed, plus attorney fees, there remains an important class issue — i.e., how the recoverable assets (if any) are to be distributed. In short, class counsel’s job — to represent the class in resolving class issues — is not yet done." Id. at 8.

But suppose class counsel has no experience in attempting to enforce judgments against defendants who have sold all their assets, ceased operations, and intend to declare bankruptcy?  The Court held that "nothing prevents class counsel from associating in counsel with that expertise, and the cost of that association can be paid by the class from any recovery achieved."  Id.  I wonder, though, how likely it is that a specialist with expertise in enforcing judgments would be interested in becoming involved in this case on a contingency-fee basis.  From the opinion, it appears that no common fund from which fees could be paid has been created, nor is one likely to be.  It is unclear whether the panel expects class counsel to pay collections counsel by the hour. 

Will class counsel ever be free of this case, even after making (unsuccessful) efforts to enforce the judgment?  The opinion answers that question:

[I]f, after diligent inquiry, class counsel determines there are no recoverable assets, counsel may present such findings to the trial court, and the trial court, as guardian of the rights of the absent class members, may determine whether counsel should be relieved of any further obligations to the class.

Id. at 8-9.  It will be interesting to see what eventually happens in this case and whether any money is ever collected.  There may also be additional appellate activity.  According to the docket, a rehearing petition was filed last Friday, December 4, and denied on Monday, December 7.

Three new UCL and class-action-related decisions

Last Thursday, November 19, 2009, was a busy day for our state appellate courts.  Thirteen published opinions (and one modification of a published opinion) were issued on that date.  I've been following the opinions for a long time, and that's a huge number for a single day.  It probably had something to do with the fact that the preceding day (Wednesday, Nov. 18) was a court closure day.  I have a feeling that a lot of our appellate justices and research attorneys (not to mention our trial court judges) aren't exactly taking those days off. 

Three of the Nov. 19th opinions, listed below, involve interesting UCL or class action issues.  I will have more on these cases after the holiday.  Happy Thanksgiving! 

• Barboza v. West Coast Digital GSM, Inc., ___ Cal.App.4th ___ (Nov. 19, 2009) (Second Appellate District, Division Four)
• Davis v. Ford Motor Credit Co., ___ Cal.App.4th ___ (Nov. 19, 2009) (Second Appellate District, Division Three)
• Dowell v. Pacesetter, Inc., ___ Cal.App.4th ___ (Oct. 20, 2009; partial pub. ord. Nov. 19, 2009) (Second Appellate District, Division Two)
  

"Class Notice in the Electronic Age"

The November 2009 isse of California Lawyer has this article by Matt C. Bailey.

"Supreme Court Appointee Sotomayor’s Judicial Record in Class Actions"

Paul Karlsgodt, author of ClassActionBlawg.com, has a very interesting post on Judge Sotomayor's rulings in class action cases.  According to Paul, she was a member of the three-judge panels in both In re Visa Check/MasterMoney Antitrust Litigation, 280 F.3d 124 (2d Cir. 2001) and In re Initial Public Offering Securities Litigation, 471 F.3d 24 (2d Cir. 2006).  (See this post for more on those cases.)

UPDATE:  Legal Blog Watch has a post on Judge Sotomayor's rulings in the Visa Check and IPO cases.