Court of Appeal limits complex litigation court's ability to resolve "threshold issues" as case management tool

"A 'complex case' is an action that requires exceptional judicial management to avoid placing unnecessary burdens on the court or the litigants and to expedite the case, keep costs reasonable, and promote effective decision making by the court, the parties, and counsel." (Cal. Rules of Court, rule 3.400(a).) California's complex litigation pilot project Courts are charged with managing, on average, some of the more complicated civil litigation matters in California. To handle that burden, complex litigation Courts have to balance obligations imposed by rule and statute with the application of creativity in the areas where discretion and flexibility are options. In my experience, particularly in the complex litigation departments in Los Angeles, one way in which complex cases have been managed has been through the early evaluation of pivotal "threshold" legal issues that tend to give direction to such cases.

That case management technique just hit something of a snag.  The Court of Appeal (Second Appellate District, Division Five), in Magana Cathcart McCarthy v. CB Richard Ellis, Inc. (May 21, 2009) held, at least on the facts before it, that early determination of "threshold issues" is not a substitute for the summary adjudication procedural requirements:

Without filing a motion for summary judgment or mandatory separate statements of undisputed facts, and for the purpose of creating appellate review of pretrial rulings, the parties to an action in a complex litigation case stipulated that the court would have granted summary judgment based upon its ruling on certain "threshold issues" in favor of the defendant. The stipulation also included a dismissal, without prejudice, of class action allegations.

We disapprove of the unauthorized procedure utilized to create appellate review without compliance with the mandatory requirements of a summary judgment, and reverse. The requirements of a motion for summary judgment and the supporting separate statements of undisputed facts are expressly mandated by statute and court rules. In the absence of such documents, the stipulated judgment cannot stand. The convenience of the parties in a complex litigation case, and their desire to be spared the expense of a summary judgment motion, do not warrant deviation from the procedural requirements of summary judgment applicable to litigants who do not have the benefit of appearing in the complex litigation court. In addition, the stipulated judgment in this case violates an express agreement between the parties and the trial court that rulings on the threshold issues would not be a substitute for a motion for summary judgment that complies with the Code of Civil Procedure. We also conclude there is nothing about this action that warrants an exception to the foregoing rules promulgated by the Legislature and Judicial Council in a case which, in its current posture, involves a potential penalty of $500 and treble damages.

(Slip op., at p. 2.)  The majority opinion (yes, there is a dissent) spends a great deal of time reviewing the obligatory nature of the separate statement and other requirements associated with summary judgment motions or anything purporting to finally resolve matters outside the four corners of the pleadings.  In reading the opinion, I come away with the sense that there is something like contempt for the complex litigation courts, including a suggestion that the issues coming from those courts are no more difficult than those coming up for review out of standard general jurisdiction courts.  I happen to strongly disagree with that apparent sentiment; the complex courts, by virtue of their experience and creativity, make complex cases move more smoothly through the system.

The dissenting opinion is extensive.  It includes its own statement of facts and procedural background.  Part of that extensive workup appears intended to demonstrate that the record was suitable for appellate review.  In the dissent, Justice Mosk first explained why the Trial Court's procedure was permitted:

The parties stipulated to a judgment based on a pronouncement of the law by the trial court that followed legal briefing and argument by the parties. The procedure used, which did not include a demurrer, summary judgment motion, or other dispositive statutory motion, was justified as being a case management tool under the complex litigation program of the Los Angeles County Superior Court (Super. Ct. L.A. County, Local Rules, rules 7.3(h), 7.6; see Cal. Rules of Court, rule 3.400 et seq.; 3.750 et seq.; Gov. Code, § 68612; Code of Civ. Proc., § 575.1).

Although trial courts in complex cases have broad discretion to manage those cases in a manner that promotes efficiency and the conservation of judicial resources (see, e.g., Cal. Rules of Court, rules 3.400 et seq., 3.750 et seq.), that discretion is limited by countervailing interests of litigants and the public. "Reviewing courts have not hesitated to strike down local court rules or policies on the ground they are inconsistent with statute, . . . [¶] A common theme in the appellate decisions invalidating local rules . . . is that a local court has advanced the goals of efficiency and conservation of judicial resources by adopting procedures that deviated from those established by statute, thereby impairing the countervailing interests of litigants as well as the interest of the public in being afforded access to justice, resolution of a controversy on the merits, and a fair proceeding." (Elkins v. Superior Court (2007) 41 Cal.4th 1337, 1352-1353.) Deviation from formal procedures may, in many instances, present on appeal a case without an adequate record. Therefore, statutory procedures, such as those governing summary judgment, are designed, inter alia, to provide the appellate court with a factual and analytical framework upon which there can be de novo review.

It is important to recognize that the trial court did not, in effect, depart from established summary judgment procedures because the parties entered into a stipulation in connection with those procedures; "[s]tipulations may be entered into concerning any step of an action." (Bardendregt v. Downing, supra, 175 Cal.App.2d at p. 735.) Moreover, the court did not dispense with any procedure over the objection and to the prejudice of one of the parties. Here, both parties agreed to the procedure employed by the trial court to determine the legal issues, stipulated to the entry of judgment as if it were based on an order granting summary judgment, and agreed that the ensuing judgment was appealable.

(Slip op., Dissent, at pp. 5-6.)  It's an interesting debate.  I come down on the side of permitting the complex courts to manage cases with the flexibility that has proven itself in real cases over and over again.  Despite that, I understand the majority's call for predictability of procedure in any instance where a case is summarily adjudicated.

in brief: on the "do's and don'ts" of Does in Pelayo v. J. J. Lee Management Co., Inc.

In Pelayo v. J. J. Lee Management Co., Inc. (May 28, 2009) the Court of Appeal (Second Appellate District, Division Four) offered priceless advice on Code of Civil Procedure section 474:  "In this case, we deal with the ―'do's and dont's'of Does."  (Slip op., at 2, first sentence.)  My compliments to Justice Willhite on that opening.  If you are planning on seeking a default judment against a Doe Defendant any time soon, be sure to read this opinion on a narrow matter of procedure.

In Strauss, et al. v. Horton, as State Registrar of Vital Statistics, et al., the California Supreme Court denied original writs of mandate challenging Proposition 8 (constitutionally definining valid "marriage" as being between a man and a woman)

Although it's an issue that isn't customarily within my wheelhouse, the Opinion issued by the California Supreme Court this morning is undoubtedly "complex."  As one barometer of the complexlity, the introductory comments span some twelve pages.  Most opinions get a paragraph or two to set the stage.  But after perusing the Opinion out of general curiosity, I decided that a few remarks (and a few long excerpts) are in order to press against the inevitability of mischaracterizations about what the California Supreme Court actually did and did not do in its opinion.  In other words, the more obscure the legal analysis, the more likely it is that it won't be summarized correctly.

On May 26, 2009, in Strauss, et al. v. Horton, as State Registrar of Vital Statistics, et al., the California Supreme Court denied Petitions for Original Writs of Mandate.  The Petitions challenged the validity of California Proposition 8, which added a new section to article I of the California Constitution.  That new section, section 7.5, reads in full: "Only marriage between a man and a woman is valid or recognized in California."  (Slip op., at p. 8.)  The language of section 7.5 is identical to language previously included in Proposition 22, which proposed the adoption in California of a new statutory provision, Family Code section 308.5.   Proposition 22 was approved by voters and later found to be unconstitutional by the California Supreme Court in the consolidated matter entitled In re Marriage Cases (2008) 43 Cal.4th 757.

Today's Opinion in Strauss offers some important clarifications about what the Court could and could not do in the exercise of its constitutional role:

For the third time in recent years, this court is called upon to address a question under California law relating to marriage and same-sex couples.

In Lockyer v. City and County of San Francisco (2004) 33 Cal.4th 1055 (Lockyer), we were faced with the question whether public officials of the City and County of San Francisco acted lawfully by issuing marriage licenses to same-sex couples in the absence of a judicial determination that the California statutes limiting marriage to a union between a man and a woman were unconstitutional. We concluded in Lockyer that the public officials had acted unlawfully in issuing licenses in the absence of such a judicial determination, but emphasized in our opinion that the substantive question of the constitutional validity of the marriage statutes was not before our court in that proceeding.

In In re Marriage Cases (2008) 43 Cal.4th 757 (hereafter the Marriage Cases), we confronted the substantive constitutional question that had not been addressed in Lockyer — namely, the constitutional validity, under the then-controlling provisions of the California Constitution, of the California marriage statutes limiting marriage to a union between a man and a woman. A majority of this court concluded in the Marriage Cases that same-sex couples, as well as opposite-sex couples, enjoy the protection of the constitutional right to marry embodied in the privacy and due process provisions of the California Constitution, and that by granting access to the designation of "marriage" to opposite-sex couples and denying such access to same-sex couples, the existing California marriage statutes impinged upon the privacy and due process rights of same-sex couples and violated those couples’ right to the equal protection of the laws guaranteed by the California Constitution.

Proposition 8, an initiative measure approved by a majority of voters at the November 4, 2008 election, added a new section — section 7.5 —to article I of the California Constitution, providing: "Only marriage between a man and a woman is valid or recognized in California." The measure took effect on November 5, 2008. In the present case, we address the question whether Proposition 8, under the governing provisions of the California Constitution, constitutes a permissible change to the California Constitution, and — if it does — we are faced with the further question of the effect, if any, of Proposition 8 upon the estimated 18,000 marriages of same-sex couples that were performed before that initiative measure was adopted.

In a sense, this trilogy of cases illustrates the variety of limitations that our constitutional system imposes upon each branch of government — the executive, the legislative, and the judicial.

In addressing the issues now presented in the third chapter of this narrative, it is important at the outset to emphasize a number of significant points. First, as explained in the Marriage Cases, supra, 43 Cal.4th at page 780, our task in the present proceeding is not to determine whether the provision at issue is wise or sound as a matter of policy or whether we, as individuals, believe it should be a part of the California Constitution. Regardless of our views as individuals on this question of policy, we recognize as judges and as a court our responsibility to confine our consideration to a determination of the constitutional validity and legal effect of the measure in question. It bears emphasis in this regard that our role is limited to interpreting and applying the principles and rules embodied in the California Constitution, setting aside our own personal beliefs and values.

Second, it also is necessary to understand that the legal issues before us in this case are entirely distinct from those that were presented in either Lockyer or the Marriage Cases. Unlike the issues that were before us in those cases, the issues facing us here do not concern a public official’s authority (or lack of authority) to refuse to comply with his or her ministerial duty to enforce a statute on the basis of the official’s personal view that the statute is unconstitutional, or the validity (or invalidity) of a statutory provision limiting marriage to a union between a man and a woman under state constitutional provisions that do not expressly permit or prescribe such a limitation. Instead, the principal issue before us concerns the scope of the right of the people, under the provisions of the California Constitution, to change or alter the state Constitution itself through the initiative process so as to incorporate such a limitation as an explicit section of the state Constitution.

In considering this question, it is essential to keep in mind that the provisions of the California Constitution governing the procedures by which that Constitution may be amended are very different from the more familiar provisions of the United States Constitution relating to the means by which the federal Constitution may be amended. The federal Constitution provides that an amendment to that Constitution may be proposed either by two-thirds of both houses of Congress or by a convention called on the application of two-thirds of the state legislatures, and requires, in either instance, that any proposed amendment be ratified by the legislatures of (or by conventions held in) three-fourths of the states. (U.S. Const., art. V.) In contrast, the California Constitution provides that an amendment to that Constitution may be proposed either by two-thirds of the membership of each house of the Legislature (Cal. Const., art. XVIII, § 1) or by an initiative petition signed by voters numbering at least 8 percent of the total votes cast for all candidates for Governor in the last gubernatorial election (Cal. Const., art. II, § 8, subd. (b); id., art. XVIII, § 3), and further specifies that, once an amendment is proposed by either means, the amendment becomes part of the state Constitution if it is approved by a simple majority of the voters who cast votes on the measure at a statewide election. (Id., art. XVIII, § 4.)

(Slip op., at pp. 1-4, origial emphasis.)  The Court then explained the scope of its holding, which may prove to be somewhat different than what was sought by any of the parties:

In analyzing the constitutional challenges presently before us, we first explain that the provision added to the California Constitution by Proposition 8, when considered in light of the majority opinion in the Marriage Cases, supra, 43 Cal.4th 757 (which preceded the adoption of Proposition 8), properly must be understood as having a considerably narrower scope and more limited effect than suggested by petitioners in the cases before us. Contrary to petitioners’ assertion, Proposition 8 does not entirely repeal or abrogate the aspect of a same-sex couple’s state constitutional right of privacy and due process that was analyzed in the majority opinion in the Marriage Cases — that is, the constitutional right of same-sex couples to "choose one’s life partner and enter with that person into a committed, officially recognized, and protected family relationship that enjoys all of the constitutionally based incidents of marriage" (Marriage Cases, supra, 43 Cal.4th at p. 829). Nor does Proposition 8 fundamentally alter the meaning and substance of state constitutional equal protection principles as articulated in that opinion. Instead, the measure carves out a narrow and limited exception to these state constitutional rights, reserving the official designation of the term "marriage" for the union of opposite-sex couples as a matter of state constitutional law, but leaving undisturbed all of the other extremely significant substantive aspects of a same-sex couple’s state constitutional right to establish an officially recognized and protected family relationship and the guarantee of equal protection of the laws.

By clarifying this essential point, we by no means diminish or minimize the significance that the official designation of "marriage" holds for both the proponents and opponents of Proposition 8; indeed, the importance of the marriage designation was a vital factor in the majority opinion’s ultimate holding in the Marriage Cases, supra, 43 Cal.4th 757, 845-846, 855. Nonetheless, it is crucial that we accurately identify the actual effect of Proposition 8 on same-sex couples’ state constitutional rights, as those rights existed prior to adoption of the proposition, in order to be able to assess properly the constitutional challenges to the proposition advanced in the present proceeding. We emphasize only that among the various constitutional protections recognized in the Marriage Cases as available to same-sex couples, it is only the designation of marriage — albeit significant — that has been removed by this initiative measure.

Taking into consideration the actual limited effect of Proposition 8 upon the preexisting state constitutional right of privacy and due process and upon the guarantee of equal protection of the laws, and after comparing this initiative measure to the many other constitutional changes that have been reviewed and evaluated in numerous prior decisions of this court, we conclude Proposition 8 constitutes a constitutional amendment rather than a constitutional revision. As a quantitative matter, petitioners concede that Proposition 8 — which adds but a single, simple section to the Constitution — does not constitute a revision. As a qualitative matter, the act of limiting access to the designation of marriage to opposite-sex couples does not have a substantial or, indeed, even a minimal effect on the governmental plan or framework of California that existed prior to the amendment. Contrary to petitioners’ claim in this regard, the measure does not transform or undermine the judicial function; this court will continue to exercise its traditional responsibility to faithfully enforce all of the provisions of the California Constitution, which now include the new section added through the voters’ approval of Proposition 8. Furthermore, the judiciary’s authority in applying the state Constitution always has been limited by the content of the provisions set forth in our Constitution, and that limitation remains unchanged.

(Slip op., at pp. 6-8.)  Although it is small consolation to the proponents of gay marriage, my reading of this Opinion is that the California Supreme Court construes the Constitutional amendment effectuated by Proposition 8 as having reserved the word "marriage" for state-recognized unions between men and women, while preserving the Marriage Cases holding that gay couples are entitled to "choose one’s life partner and enter with that person into a committed, officially recognized, and protected family relationship that enjoys all of the constitutionally based incidents of marriage."  (Marriage Cases, supra, 43 Cal.4th at p. 829).  They just can't call it a marriage.  In other words, everybody is going to be unhappy with this decision.

While there is likely to be much commentary about what should happen in our society after this Opinion, I think that, in a difficult circumstance, the California Supreme Court correctly discharged its limited role in our government.  The Court doesn't deserve to be pilloried here, and I hope that it is not.

Petition for Review denied in Cristler v. Express Messenger Systems, Inc.

The California Supreme Court has denied the Petition for Review in Cristler v. Express Messenger Systems, Inc. (2009) 171 Cal. App. 4th 72.  My prior post on the case can be found here.  The denial is unfortunate, as the case is likely to be misconstrued as a decision about the independent contractor/employee distinction, rather than the jury instruction and standard of review opinion that it is.

The Complex Litigator is now available for Kindle e-books

If you happen to be Kindle user, you can subscribe to The Complex Litigator at Amazon.com.  Two comments come to mind.  First, I'm mildly amazed that it is so easy to provide this blog in that way.  I'd be "very" amazed, but that would be disingenuous after configuring my own DNS settings with a new registrar, putting Windows 7 RC1 on a netbook, and so on.  Second, I had nothing to do with setting the $1.99 subscription price.  That is Amazon.com's business.

In Clark v. Superior Court, the Court of Appeal tackles a major, but novel question about the interplay between the UCL and statutory penalty provision protecting seniors

The California Court of Appeal, Second Appellate District, Division Seven, has been in the thick of many a difficult class action or class-related question.  Why should today be any different?  After all, I spent an hour and half driving about 8 miles to work, so everything seems to be functioning as intended in our fine City and State.  But I digress.  Today, the Division Seven, in Clark v. Superior Court (May 21, 2009) was asked to reconcile statutes with similar purposes (consumer protection) but very different means of implementing those purposes.  The question presented to the Court makes the challenge clear:

Civil Code section 3345 (section 3345) authorizes the award of an enhanced remedy—up to three times greater than the amount of a fine, civil penalty "or any other remedy the purpose or effect of which is to punish or deter" that would otherwise be awarded—in actions by or on behalf of senior citizens or disabled persons seeking to "redress unfair or deceptive acts or practices or unfair methods of competition." Is this enhanced remedy available in a private action by senior citizens seeking restitution under California’s unfair competition law (Bus. & Prof. Code, § 17200 et seq.)?

(Slip op., at p. 2.)  Can the protected classification of senior citizens receive triple UCL restitution?  That's quite a question.  What might be more suprising at first blush is that the Court of Appeal said, "Yes."

Procedurally, after a class was certified, defendant National Western filed a motion for judgment on the pleadings, asserting section 3345’s enhanced, "treble damages" remedy was inapplicable to a private action under the unfair competition law.  The trial court granted the motion.  Plaintiffs filed a petition for a writ, and the Court of Appeal granted the petition, issuing the writ.  By necessity, the Court of Appeal reviewed the two laws:

Since 1977 the unfair competition law has prohibited unlawful, unfair or fraudulent business practices or unfair, deceptive, untrue or misleading advertising (Bus. & Prof. Code, § 17200) and subjected violators in actions prosecuted by public prosecutors to civil penalties not exceeding $2,500 for each violation (Bus. & Prof. Code, § 17206), as well as to injunctions and restitution orders (Bus. & Prof. Code, § 17203). Private plaintiffs may also prosecute actions under the unfair competition law, but their remedies are limited to orders for injunctions and restitution. (Bus. & Prof. Code, § 17203.) Damages and penalties, whether compensatory or punitive, are prohibited. (Korea Supply, supra, 29 Cal.4th at p. 1148 [only monetary relief available to private plaintiffs under unfair competition law is restitution; compensatory and punitive damages are not authorized]; Kasky v. Nike, Inc. (2002) 27 Cal.4th 939, 950 ["[i]n a suit under [unfair competition law], a public prosecutor may collect civil penalties, but a private plaintiff’s remedies are ‘generally limited to injunctive relief and restitution’"]; Cel-Tech, supra, 20 Cal.4th at p. 179 [under unfair competition law "[p]laintiffs may not receive damages, much less treble damages, or attorney fees"].)

(Slip op., at pp. 5-6.)  Many years later, the legislature determined that senior citizens were regular targets of unfair competition schemes and required additional protection.  A variety of potential statutes and amendments to existing laws were considered, including revisions to the UCL and the CLRA.  (Slip op., at pp. 6-10.)  Sweeping legislation was finally passed.

As finally enacted the legislation effected three major changes to California’s consumer protection laws relating to senior citizens and disabled persons. First, it amended the unfair competition law by adding Business and Professions Code section 17206.1,8 which authorizes the Attorney General and prosecutors in civil enforcement proceedings to recover an added civil penalty up to $2,500 (in addition to the $2,500 civil penalty available under Business and Professions Code section 17206) when the unfair practice is perpetrated against a senior citizen or disabled person. (See Bus. & Prof. Code, § 17206.1; Stats. 1988, ch. 823, § 1, pp. 2665-2666.)

Second, it amended the CLRA to authorize private litigants to recover, in addition to other remedies available under the act, including compensatory and punitive damages, an additional monetary award—up to $5,000—when the unfair practice prohibited by the act is perpetrated against a senior citizen or disabled person. (Civ. Code, § 1780, subd. (b)(1)(A)-(C); Stats. 1988, ch. 823, § 3, pp. 2667-2668.)

Third, it added section 3345 to the Civil Code, authorizing an enhanced remedy in actions brought by or on behalf of senior citizens seeking redress for "unfair or deceptive acts or practices or unfair methods of competition." (§ 3345, subd. (a).) Section 3345, subdivision (a), limits the new provision to actions "brought by, or on behalf of, or for the benefit of senior citizens or disabled persons, as those terms are defined in subdivisions (f) and (g) of [Civil Code] Section 1761[10] to redress unfair or deceptive acts or practices or unfair methods of competition." Section 3345, subdivision (b), provides the enhanced remedy: "Whenever a trier of fact is authorized by a statute to impose either a fine, or a civil penalty or other penalty, or any other remedy the purpose or effect of which is to punish or deter, and the amount of the fine, penalty, or other remedy is subject to the trier of fact’s discretion, the trier of fact shall consider all of the following factors, in addition to other appropriate factors, in determining the amount of fine, civil penalty or other penalty, or other remedy to impose. Whenever the trier of fact makes an affirmative finding in regard to one or more of the following factors, it may impose a fine, civil penalty or other penalty, or other remedy in an amount up to three times greater than authorized by the statute, or, where the statute does not authorize a specific amount, up to three times greater than the amount the trier of fact would impose in the absence of that affirmative finding."

(Slip op., at pp. 12-13.)  The Court then turned to the question:

Under the plain language of section 3345 two prerequisites must be satisfied before its enhanced remedy may apply: (1) The action must be brought by or on behalf of senior citizens or disabled persons seeking redress for "unfair or deceptive acts or practices or unfair methods of competition"—plainly satisfied here; and (2) the action must be one in which the trier of fact is authorized by a statute to impose a fine, civil penalty or any other penalty the purpose or effect of which is to punish or deter.

(Slip op., at p. 14.)  The Court then concluded that the enhanced restitution remedy was available:

Unlike Korea Supply and Cel-Tech, in this case the plaintiffs do not seek to justify monetary relief other than restitution under the unfair competition law: The enhanced remedy is sought under section 3345, a separate statute, which specifically authorizes such an enhanced remedy in unfair competition actions brought by senior citizens. We simply must presume the Legislature meant what it said when it provided section 3345 applied in unfair competition actions involving a fine, civil penalty or "any other remedy" the purpose of which is to punish or deter. (See People v. Toney (2004) 32 Cal.4th 228, 232 ["[i]f the statutory language is unambiguous, ‘we presume the Legislature meant what it said, and the plain meaning of the statute governs’"]; accord, Genlyte Group, LLC v. Workers’ Comp. Appeals Bd. (2008) 158 Cal.App.4th 705, 714; see also Hood v. Hartford Life & Accident Insurance Co. (E.D. Cal. 2008) 567 F.Supp.2d 1221, 1227 ["[t]he text of the statute clearly indicates that section 3345 applies to the UCA [unfair competition law] and the CLRA, as both Acts prohibit ‘unfair practices’"].)

(Slip op., at p. 16-17.)  I can't imagine that this ruling won't at least generate a Petition for Review.

Update on 2009-05-22 04:52 by The Complex Litigator

UPDATE:  The Court of Appeal issued a modification to the opinion, adding a footnote with no change in the judgment.

Tobacco II Opinion generates widespread media coverage and commentary

Monday's Tobacco II Cases Opinion has generated extensive media coverage and commentary.  Here's a sample of the reactions:

• Courthouse News Service said, in a brief commentary, "Plaintiffs in a class-action lawsuit against the tobacco industry are not required to show that every member has relied on the tobacco industry's claims about cigarettes, the California Supreme Court ruled."
• In a press release issued through PRWeb's emediawire.com, commentary included: "This new ruling will clarify a number of legal issues, and will reject the idea that in a class action, each and every class member will have to show "reliance" on a fraudulent act to win a class action. This will mean that the hundreds of thousands of California residents who have been harmed by tobacco companies may seek relief in court."
• LegalNewsline primarily focused its coverage on the Tobacco II Cases, "The California Supreme Court, in a 4-3 vote Monday, has reinstated a class action lawsuit against tobacco companies accused of misleading advertising."
• Jon Hood, at consumeraffairs.com, discussed the significant implications for consumer class actions, "Justice Carlos Moreno, writing for the majority, said that the law was only intended to stop 'shakedown' lawsuits against businesses, and was passed in response to the practice of small business paying lawyers off to make threatened suits go away. Moreno said that the Court of Appeals' view 'would effectively eliminate the class action lawsuit as a vehicle for vindication of (consumer) rights.' Moreno also pointed out that Prop 64's sponsors explicitly provided in ballot arguments that they did not intend to weaken consumer protection laws."
• Metnews.com also focused on the facts of the case itself, but delved further into the rationale of the majority opinion, "Proposition 64, Moreno elaborated, amended the UCL by requiring a showing that the plaintiff has suffered injury 'as a result of' an unfair, unlawful, or fraudulent act or practice. The initiative does not, he said, make 'any reference to altering class action procedures to impose upon all absent class members the standing requirement imposed upon the class representative.'"
• The UCL Practitioner collected blog and news commentary in posts here and here.  I find it particularly amusing that Will Stern, an architect of Proposition 64, seems surprised that the ballot measure promise that the amendment was not intended to weaken consumer protections should come back as a basis for the Supreme Court's Tobacco II Cases Opinion.

Despite all this coverage, one comment that I find particulary significant has received little in the way of analysis:

Moreover, Proposition 64 left intact provisions of the UCL that support the conclusion that the initiative was not intended to have any effect on absent class members. Specifically, Proposition 64 did not amend the remedies provision of section 17203. This is significant because under section 17203, the primary form of relief available under the UCL to protect consumers from unfair business practices is an injunction, along with ancillary relief in the form of such restitution “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.” (§ 17203.)

(Slip op., at p. 21)  Over the last several years, I have contended in many class certification motions that UCL classes could be certified under the less stringent Fed. R. Civ. P. 23(b)(2) class (recognized by California Courts) because the essence of a UCL claim is injunctive relief, including any Order of restitution.  I contend that this is particularly valid where a minimum amount of restitution can be identified.  Under the policy that unjust enrichment cannot be tolerated under the UCL, an equitable order directing disgorgement in that circumstance is primarily injunctive in nature.  Circumstances have conspired to deprive me of a trial court ruling on the issue.  Perhaps I shall have a further opportunity to pursue this theory in the near future.

COMPLEX TECH: Install Windows 7 RC1 on a netbook

Considering the price of a netbook ($300 - $450), the price of Windows 7 RC1 (free to download and try until June), and how easy it is to put Windows 7 RC1 on a netbook, there is no reason not to try out this new operating system on a secondary system.  I put Windows 7 RC1 on an Acer netbook over the weekend, and the process was amazingly smooth.  You will need an external DVD burner to make this really easy to do (around $100), since netbooks don't come with optical drives.  Also, it will be easier to do this with a netbook that includes a hard drive, rather than a solid state drive.  The solid state drives in many netbooks are just too small.  Finally, follow these instructions on ZDNet.

The operating system looks beautiful and seems to be faster than XP was on that same netbook.  The screen looks better under Windows 7 than it did on XP.  IE 8 seems to open and load faster.  It handles wireless settings much better than XP.  Pending further study, I will buy a copy of the OS for that netbook when it comes out later this year.

BREAKING NEWS: Tobacco II Cases Opinion is available and does not impose classwide reliance showing under the UCL

In re Tobacco II Cases is available for viewing now.  The summary of the case is best that I can provide for now:

On review, we address two questions: First, who in a UCL class action must comply with Proposition 64’s standing requirements, the class representatives or all unnamed class members, in order for the class action to proceed? We conclude that standing requirements are applicable only to the class representatives, and not all absent class members. Second, what is the causation requirement for purposes of establishing standing under the UCL, and in particular what is the meaning of the phrase "as a result of" in section 17204? We conclude that a class representative proceeding on a claim of misrepresentation as the basis of his or her UCL action must demonstrate actual reliance on the allegedly deceptive or misleading statements, in accordance with well-settled principles regarding the element of reliance in ordinary fraud actions. Those same principles, however, do not require the class representative to plead or prove an unrealistic degree of specificity that the plaintiff relied on particular advertisements or statements when the unfair practice is a fraudulent advertising campaign. Accordingly, we reverse the order of decertification to the extent it was based upon the conclusion that all class members were required to demonstrate Proposition 64 standing, and remand for further proceedings regarding whether the class representatives in this case have, or can demonstrate, standing.

(Slip op., at pp. 2-3.)  There should be some very interesting adjustments to positions in consumer class actions alleging UCL claims for deceptive or misleading statements.

Domain mapping change may cause temporary access issues on this site

I am about to flip the switch and direct the domain of www.thecomplexlitigator.com to this SquareSpace blog.  Changes to DNS settings can take 24-48 hours to finish propagating throughout the internet's DNS servers.  I you are using a major ISP, it is likely that the change will take effect for you in hours rather than days.

Please excuse the temporary disruption.

Update on 2009-05-16 18:20 by The Complex Litigator

UPDATE:  I have to extend my compliments to GoDaddy and SquareSpace for making this entire process so easy.