Wednesday, March 25, 2015

Class Cert Denied for Sephora Specialists

Mies v. Sephora USA, Inc., No. A139410 (D1d1 Feb. 26, 2015)

Assistant managers at makeup retailer Sephora—called “Specialists” in Sephora-ise—bring a class action alleging that they are misclassified as exempt from the wage and hour laws. The big issue is whether they spend more than half their time on nonexempt work. Problem for plaintiffs is that “Specialist” turns out to be a pretty broad category at Sephora. Some of them spend the bulk of their time dealing with customers on the sales floor (which is not exempt work). Others spend most of their time on management and training activities (which can be exempt). 

The trial court quite reasonably determined that while there might be some simple common legal questions about what work was and was not exempt, the key issue in the case under the relevant legal standard—how did the class members actually spend their time at work—was “heavily individualized.” The court here holds that, under the circumstances, the trial court did not abuse its discretion because “[g]iven the evidence before it, the trial court here could reasonably view the likely disputes at trial as being less about how to classify certain tasks (such as selling) and the impact of company policies, and more about how individual Specialists spend their time.”


Tuesday, March 24, 2015

With Adversaries Like this, Who Needs Client Conflicts?

Acacia Patent Acquisition, LLC v. Superior Court, No. G050226 (D4d3 Feb. 27, 2015)

This is a conflicts riddle much harder than anything on the MPRE. 

Citing AAA Rules Held Sufficent to Let the Arbitrator Decide Class Arbitration Issue

Univ. Protection Serv. v. Superior Court, No. D066919 (D4d1, as amended Mar. 12, 2015)

As we’ve discussed, when it comes to deciding whether an arbitration can occur on class basis there is a division of authority (upon which review has been granted by the California Supreme Court) as to whether it is an issue for the court to decide. Although there is general agreement that the issue can be assigned to the arbitrator if the parties clearly express that intent. Going with the majority rule (that the court decides) the court here holds that the trial court erred in determining that the issue is by default for the arbitrator. But the parties agreement specifically invoked a set of AAA rules that clearly state that the arbitrator decides whether a class claim can be brought. That was enough, in the court’s opinion, to get out of the default rule. So even though the trial court got the rule wrong, the result was right.

Writ denied.

Unconscionable Arb Provision Held Severable

Trabert v. Consumer Portfolio Servs., Inc., No D065556 (D4d1 Mar. 3, 2015)

This case involves a rather poorly drafted arbitration clause in a used car sales contract. In a prior appeal, the court had found that one discrete parts of the clause was unconscionable, but remanded to the trial court to decide whether they were severable. The trial court said no severance, but the court of appeal disagrees. Generally, the rule in California favors severance. Here, the problematic clauses—which dealt with the finality of an arbitral award—could be severed by removing the language that made certain awards non-final.


Friday, March 20, 2015

On the Dangers of Finding a Cite and Calling It Quits

Rodriguez v. Brill, No. F068518 (D5 Feb. 20, 2015)

This case touches on what, to me, is one of the most significant questions of practical appellate jurisprudence: In issuing a reasoned decision, what is the court’s obligation to independently research issues that are presented by the parties, but not thoroughly briefed? (Or, for that matter, issues that appear to be thoroughly briefed, but aren’t.)

Wednesday, March 18, 2015

This Fight Doesn't Seem Over

Franco v. Arakellian Enters., No. B232583 (D2d1, as modified Mar. 11, 2015)

This is an employee class action where the plaintiff asserts claims under both the Labor Code Private Attorney General Act as well as other statutes. This is the Second District’s third shot in this case, which has been ping-ponging through the courts as the law regarding the arbitrability of certain claims kept changing.  This time, the court gets the case on transfer from the California Supreme Court to reconsider in light of Iskanian v. CLS Transportation Los Angeles, LLC, 59 Cal. 4th 348 (2014), which held that PAGA claims are not arbitrable under arbitration clauses in an employment agreement because the claims actually belong to the state government, even if they are prosecuted by an employee on a quasi-qui tam basis.

Given cumulative effects of the U.S. Supreme Court’s decision in AT&T Mobility v. Concepcion, 563 U.S. ---, 131 S.Ct. 1740 (2011) and the state supreme court’s Iskanian ruling, the results are pretty clear: Plaintiff’s non-PAGA claims are arbitrable and subject to a class valid action waiver. Plaintiff’s PAGA claims are not arbitrable and the waiver of his right to bring representative PAGA actions is unenforceable, but severable from the otherwise valid arbitration provision. On remand, the trial court should stay the PAGA claims under Code of Civil Procedure 1281.4, pending resolution of the non-PAGA claims by arbitration.

Remanded with orders.

Bogus Crossclaims Can't Block Attachment

Lydig Const. v. Martinez Steel Corp., No. D066854 (D4d1 Feb. 26, 2015)

The case is a government contact construction dispute where a contractor alleges that its steel supplier didn’t get work done on time. The contractor moved for a pretrial writ of attachment. The supplier filed a cross-complaint which, if successful, would have completely offset the contractor’s damages. The supplier argued that the cross-claim precluded attachment, but the trial court disagreed and entered a writ for about $200k.

The court of appeal affirms. A writ of attachment can be issued when the plaintiff has a contractual claim for a readily ascertainable sum more than $500. Under Code of Civil Procedure § 483.010, the movant needs come forward with evidence establishing that: (1) that the claim is a proper claim for attachment; (2) the probably validity of the claim; (3) that the attachment is not sought for some ulterior purpose; and (4) that the amount to be secured is more than zero. On the fourth element, under § 483.015, the amount to be secured must be offset by any amount sought in a cross-complaint if that claim is one upon which an attachment could issue. The relevant precedents
gloss on the statute requires the cross-claimant to come forward with at least prima facie evidence on the merits of its claims in order to get setoff credit.

Here, the supplier didn’t submit credible evidence showing the merit of its cross-claims, so it was not entitled to the setoff. The contractor, on the other hand, did establish the probable validity of its claims. So the writ properly issued.