(Just Slightly) OFF TOPIC: Neo blames paparazzo for damaging Neo's car with body. Mr. Smith laughs evilly.

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I am very sorry, but I am constitutionally incapable of remaining serious for the life of this blog.  Thus, when I read on California Punitive Damages that Keanu Reeves lost a motion to strike punitive damage claims brought by a photographer that acccused Mr. Reeves of intentionally running into him, I saw a fat one in my wheelhouse.  Imagine the hearing...

NEO:  Your Honor Dude, I move to strike that paparazzo's outrageous punitive damage claims.

MR. SMITH:  Mr. ... Anderson.  We have your file.  We know how much force you applied to the accelerator.  We know you backed up to look for tread marks.  You struck the photograher.  Your motion to strike is denied Mr. Anderson.  And you know what they say; two strikes do make an intentional tort.  [Laughs evilly.]

NEO:  Who are you?  I want my lawyer.

MR. SMITH:  And how will you speak to your lawyer...when you don't have a mouth.  [Laughs even more evilly as NEO claws at his now mouthless face in horror.]

If you didn't watch the Matrix films (i.e., if you are older than me or lack the nerd/geek gene) this will all be meaningless to you.  It was really, really funny to me.  For an ever so slightly less fanciful version of this story, head over to California Punitive Damages.  If you have no idea what I am talking about, but are curious enough to do some research, take a look at Wikipedia's page on the Matrix.

[Via, oddly enough, California Punitive Damages.]

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In light of the Federal Reserve's proposed new credit card regulations, are we looking at the next frontier in unfair practice class actions?

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On May 2, 2008, the Federal Reserve Board proposed rules "to prohibit unfair practices regarding credit cards and overdraft services that would, among other provisions, protect consumers from unexpected increases in the rate charged on pre-existing credit card balances."  (See, May 2, 2008 Press Release.)The proposed revisions to the FTC Act include five key protections for consumers that use credit cards:

  • Banks would be prohibited from increasing the rate on a pre-existing credit card balance (except under limited circumstances) and must allow the consumer to pay off that balance over a reasonable period of time.
  • Banks would be prohibited from applying payments in excess of the minimum in a manner that maximizes interest charges.
  • Banks would be required to give consumers the full benefit of discounted promotional rates on credit cards by applying payments in excess of the minimum to any higher-rate balances first, and by providing a grace period for purchases where the consumer is otherwise eligible.
  • Banks would be prohibited from imposing interest charges using the "two-cycle" method, which computes interest on balances on days in billing cycles preceding the most recent billing cycle.
  • Banks would be required to provide consumers a reasonable amount of time to make payments.

The proposed rule revisions would also address subprime credit cards by limiting the fees that reduce the available credit to the consumer. In addition, banks that offer credit by advertising multiple rates or credit limits would be required to disclose in their solicitation the factors that determine whether a consumer will qualify for the lowest rate and highest credit limit.

Looking at the detailed regulations governing mortgage lending (TILA and Regulation Z), and the decisional law that followed, it appears that even sophisticated banks routinely fail to implement practices and procedures that are fully compliant with regulatory requirements.  Assuming similar difficulty by lenders in adjusting their practices to comply with new credit card-related regulations, we may be looking at the "next thing" in consumer class action litigation.  After all, we're still waiting to see what the Seventh Circuit will do with the trial court decision in Andrews v. Chevy Chase Bank FSB (E.D.Wis. 2007) 474 F.Supp.2d 1006, a case holding that a declaration of the right to rescind under TILA was available on a class-wide basis.  If that question still isn't settled under TILA to this day, you can safely wager your home that new credit card practices regulations will leave much for Courts to decide.

[Via Consumer Law & Policy Blog]

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Breaking (Unpleasant) News: U.S. federal courthouse in San Diego closed Monday due to bombing

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Wage Law, a usually pleasant read on developments in California's wage & hour litigation-scape, is the source for the unfortunate news on this blog that a pipe bomb exploded outside the federal courthouse in San Diego (Southern District of California).  According to FOXNews, the pipebomb exploded at 1:40 a.m. on Sunday, May 4, 2008.  Fortunately no injuries resulted from the late night detonation.  You can view the notice regarding the courthouse closure on the Southern District's homepage.

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Large majority of Am Law 200 firms not yet fully sold on blogging

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LexBlog, a company that helps build and maintain law blogs, conducted a survey of blogging activity by Am Law 200 firms.  As reported via a Law.com article, as of mid-March, 53 Am Law 200 firms were blogging in some manner, either through a blog the firm itself sponsored or a blog run on the side by one of its lawyers.  (Alan Cohen, Cutting a Winning Edge in Law Firm Blogs (May 2, 2008) www.law.com.)  The blogging activities of Am Law 200 firms is relatively new: "A little more than a third of those firms started blogging in the last six months alone, according to LexBlog."  (Ibid.)  Most Am Law 200 firms offer very targeted blogs, focusing on a specific area of law.

Large firms examining the bloggin issue return to the same questions:

  • How much business will a blog generate?
  • What if something goes wrong as a result of a blog?
  • How much nonbillable time will a blog take?

While the big firms wrestle with these issues, the biggest returns on the blogging investment are being realized by small firms.  (Gina Pasarella, Am Law Firms Giving Blogs The Stamp Of Approval (April 17, 2008) www.law.com.)  "Blogs can be more effective than almost any other marketing tool in showing a clear return on investment, according to one legal marketer."  (Ibid.)

Blogging in the legal industry is rapidly evolving, and I'm willing to confront the risks that have about three quarters of the Am Law 200 sitting on the sidelines.  The last 5 weeks since this blog launched have been exciting, educational, nerve-wracking, and tiring.  But it has been worth it so far.  And just in case you didn't read my disclaimer, I'm not offering you any legal advice on this blog, and we don't have an attorney-client relationship just because you found and read this blog.  Oh, and my blogging is unrelated to my employment or my employer.  Just so we're clear on those details.

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The second of Senator Margett's attacks on California's meal break law is also in freefall

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The likely demise of SB 1192 was covered previously by The Complex Litigator.  (See, "That would be 'Plaintiffs: 2, Defendants: 0'".)  Senator Margett's second challenge to the present formulation of California's meal break law, SB 1539, a bill that sought to dillute the statutory entitlement to meal breaks or sue for missed meal break wages, made it out of committee, was substantially amended on April 15th, and set for hearing today.  That hearing was withdrawn.  It looks like legislative efforts to revise how meal breaks are treated is back to square one.  With a democratically controlled legislature and a governor that, despite liberal tendencies, is generally in favor of any legislation that eases requirements for business, it appears unlikely that anything will be sorted out any time soon.

[Via Wage Law.]

UPDATE:  For an alternative view on the significance of the recent history of SB 1539, read the recent post at the California Labor & Employement Law Blog, entitled "California Legislature Indicates Intent To Clarify Meal Period Law."  California Labor & Employment Law Blog says, "While the meal period laws have not been changed, the Legislature’s declaration of intent is a good sign that lawmakers recognize the need for change and will continue to have further discussions to try to find consensus on a solution that contains adequate protections for employers and employees."  Only time will tell, but I don't share their "optimism." 

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That would be "Plaintiffs: 2, Defendants: 0"

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Earlier today I ran across a post at The Witness Box, a blog by the law firm Jackson Lewis.  Their post, entitled "Wage and hour developments: 1 for the plaintiff - 1 for the defense," presented two wage & hour developments, one apparently "pro-plaintiff" and one apparently "pro-defense."  The "pro-plaintiff" development concerns Massachusetts law; it is thus of little interest to me, particularly for this presumably California-centric blog.  The "pro-defense" development is another matter.

Wage & hour practitioners will recall Murphy v. Kenneth Cole Prods. (2007) 40 Cal.4th 1094, in which the California Supreme Court determined that the one hour of pay owed to an employee that misses a meal break is a wage and not a penalty (with a 1-year Statute of Limitation).  When coupled with Unfair Competition Law claims, this ruling effectively provided a 4-year Statute of Limitation to claims for missed meal breaks.

Not excited yet, Non-Wage & Hour Practitioner?  Then let me try to expand the relevance a little.  Murphy resulted in a predictable upswing in meal break claim class actions.  Earlier this year, Senator Margett introduced SB 1192, which would have re-classified the "pay" owed to an employee for a missed meal break as a penalty, thereby truncating the claim period to one year.  Which brings me to my observation about the post on the Witness Box.  According to The Witness Box article, SB 1192 represents the legislature's effort to ease penalties for missed meal breaks.

Not so fast.  According to the California Sentate, the first hearing on SB 1192 was "canceled at the request of author."   Couple that with reporting by Storm's California Employment Law blog that "SB 1192 appears dead," and things aren't looking good for SB 1192.  Or for that premature call of "1 for the plaintiff - 1 for the defense."  The moral of the story is that it is good to know about proposed legislation, but don't place any weight on a bill that hasn't even managed to have its scheduled hearing in committee.

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Daily Journal Forum column challenges recent anti-class action campaign

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This morning's Daily Journal (Tuesday, April 15, 2008) includes my article entitled "Cutting Class," in the Forum column.  Thank you, Daily Journal.  Online access is by subscription only, so no link to the article is provided here.

If you visited this blog way back in its early days (a couple of weeks ago), you may recall that I had more than a few criticisms of John H. Sullivan's March 20, 2008 Daily Journal Forum column, entitled "No Class."  (See Criticism of Mr. Sullivan's column.)  After some encouragement by readers, including an Anonymous commenter, I ran a proprietary anti-acerbic filter on some of my earlier blog comments.  The result was today's article.  I'm proud to say that it is my second article published by the Daily Journal.

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