Thanks to inter-alia.net for the mention

Inter-alia.net is a blog dedicated to furthering online legal research. The Complex Litigator was chosen as a Blawg of the Day last week. Thanks to Tom Mighell for the kind mention.  It's a rich resource for uncovering new sources in the ever-changing and expanding world of legal blogs and websites.

E-mail is "personal identification information," and CAN-SPAM does not pre-empt the Song-Beverly prohibition on requests for such information

Technology, which is forward looking, and law, which is backwards...looking, frequently bang heads.  In Powers v. Pottery Barn, Inc. (September 21, 2009), the Court of Appeal (Fourth Appellate District, Division One) examined whether the federal law "Controlling the Assault of Non-Solicited Pornography And Marketing Act of 2003" (tit. 15, U.S.C, § 7701 et seq.) (CAN-SPAM) pre-empted provisions of the Song-Beverly Credit Card Act of 1971 in a lawsuit challenging a merchant's practice of requesting consumer e-mail addresses at the time the consumer makes a credit card purchase.  The Court easily found that, because CAN-SPAM does not pre-empt state laws that "are not specific to electronic mail," it did not pre-empt the Song-Beverly prohibition on collecting personal identification information.  Slip op., at 2.

Regarding the purpose of Song-Beverly, the Court said:

Song-Beverly was enacted in 1971. "The act 'imposes fair business practices for the protection of the consumers. "Such a law is remedial in nature and in the public interest [and] is to be liberally construed to the end of fostering its objectives." ' [Citations.]" (Florez v. Linens 'N Things, Inc. (2003) 108 Cal.App.4th 447, 450.)

Slip op., at 4.  And the Court explained pre-emption by CAN-SPAM, and the limits on that pre-emption:

Congress expressly provided that CAN-SPAM pre-empts state anti-SPAM laws: "This chapter supersedes any statute, regulation, or rule of a State or political subdivision of a State that expressly regulates the use of electronic mail to send commercial messages, except to the extent that any such statute, regulation, or rule prohibits falsity or deception in any portion of a commercial electronic mail message or information attached thereto." (Tit. 15, U.S.C., § 7707(b)(1).) Importantly, Congress also expressly limited the pre-emptive impact of CAN-SPAM: "This chapter shall not be construed to preempt the applicability of—(A) State laws that are not specific to electronic mail, including State trespass, contract, or tort law; or (B) other State laws to the extent that those laws relate to acts of fraud or computer crime." (Tit. 15, U.S.C., § 7707 (b)(2).)

Slip op., at 7.  Applying both, the Court concluded that Song-Beverly was not pre-empted:

CAN-SPAM cannot be interpreted as pre-empting application of Song-Beverly to Pottery Barn's collection of e-mail from its credit card customers.  Song-Beverly does not expressly regulate any Internet activity, let alone use of "electronic mail to send commercial messages." (See Tit. 15, U.S.C § 7701(b)(1).) Rather, as we have discussed, Song-Beverly only governs the information businesses may collect in the course of transacting business with credit card users. Thus Song-Beverly does not fall within the scope of CAN-SPAM's express pre-emption provisions. Importantly, CAN-SPAM does not permit us to find any implied pre-emption here. CAN-SPAM not only has a carefully limited express pre-emption provision, but it also expressly excludes pre-emption of any state laws, such as Song-Beverly, which "are not specific to electronic mail."

Slip op., at 8.  So there you have it.  Collecting an e-mail address has now been recognized as collecting personal identification information, at least under Song-Beverly.

NOTE:  Sections V and VI of the opinion are not published.  However, the Court's Opinion inadvertently left out the Section V heading.  I believe that it should appear after the first two sentences of page 12, but that's just a best guess until they correct the opinion.

Update on 2009-09-21 22:50 by The Complex Litigator

The Court has issued a corrected opinion that inserts the missing roman numeral heading on page 12.  I commend their speedy correction.

The choice between amending a complaint and appealing a demurrer can be challenging

There have been instances in litigation where my confidence in a legal position has tempted me to eschew the filing of an amended complaint in favor of appealing an order sustaining a demurrer.  Thus far, I haven't chosen to bypass an occasion to amend, but I've been very close.  Today, the Court of Appeal (Second Appellate District, Division Three) offers a reminder that such a choice can have substantial consequences, holding, in Las Lomas Land Company, LLC v. City of Los Angeles (September 18, 2009), that "having expressly declined an opportunity to amend its pleading in the trial court, Las Lomas cannot seek leave to amend for the first time on appeal."  Slip op. at 2.

As an aside, the subject matter of this case, a dispute over a rejected land development project, doesn't necessarily have much to do with this blog, aside from the fact that a multi-million dollar dispute over a land development project is decidedly more "complex" than your average civil lawsuit.  But the issue presented at the end of the opinion, the waiver of the right to amend, can surface anywhere, and procedural wrinkles like this interest me.

The Court summarized the law governing when a right to amend is not waived:

The sustaining of a demurrer without leave to amend is an abuse of discretion if there is a reasonable possibility that the defect could be cured by amendment. (Schifando v. City of Los Angeles, supra, 31 Cal.4th at p. 1081.) The burden is on the plaintiff to show in what manner the pleading could be amended and how the amendment would change the legal effect of the pleading. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 349.) The failure to request leave to amend in the trial court ordinarily does not prevent a plaintiff from making such a request for the first time on appeal. (Code Civ. Proc., § 472c, subd. (a); Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1386.)

Slip op., at 30-31, fn. omitted.  But it doesn't work that way when a potential amendment is possible:

The general rule allowing a plaintiff to request leave to amend for the first time on appeal does not apply, however, if the trial court sustains a demurrer with leave to amend and the plaintiff elects not to amend the pleading. (Reynolds v. Bement (2005) 36 Cal.4th 1075, 1091.) In those circumstances, " 'it must be presumed that the plaintiff has stated as strong a case as he can.' " (Ibid.)  The trial court here did not enter an order sustaining the demurrer with leave to amend, but instead asked whether Las Lomas was requesting leave to amend.  By answering "No," counsel for Las Lomas expressly declined an opportunity to amend the pleading just as surely as if the court had granted leave to amend and Las Lomas had elected not to do so.  In our view, the result should be the same. We therefore conclude that Las Lomas forfeited its claim of error based on the denial of leave to amend and deny the motion for leave to amend its petition and complaint.

Slip op., at 31, fn. omitted.  Now, it may very well be the case that you want to frame an issue for appellate review in a specific way and decline an opportunity to amend for that very purpose.  Just be sure you intend the consequences if you pass on a chance to amend a complaint.

CAOC Board elections open online until September 18, 2009

If you are a member of the Consumer Attorneys of California (CAOC), and you haven't yet voted for the Board of Governors, you stil have a chance to do so.  Voting is open online until September 18, 2009 (note the conveniently included hyperlink).  If you are eligible to be a member of CAOC but aren't, get cracking and join CAOC.  More members means a louder, unified voice speaking on behalf of consumers and employees (you know, the down-trodden masses, the grist for the corporate mills).

It also happens that I am running again for the Board of Governors.  Remember that a vote for me is like a vote to feed hungry orphans, but slightly different.

In Cho v. Seagate Technology Holdings, Inc. (Klausner, Objector), Court holds that allegations of collusion, without evidentiary support, are insufficient to overturn settlement or allow discovery to objector

In Kullar v. Foot Locker Retail, Inc., 168 Cal. App. 4th 116 (2008), the Court of Appeal (First Appellate District, Division Three) set aside a settlement and permitted an objector to obtain discovery to assess whether the settlement was "fair, reasonable and adequate."  See blog post.  However, the objector in Cho v. Seagate Technology Holdings, Inc. (Klausner, Objector) (September 15, 2009) did not achieve similar results, despite appealing to the very same First Appellate District, Divsion Three.

Cho alleged that Seagate overstated the size of its hard drives (its an ego thing, really) by using the decimal definition of “gigabyte” (equal to 1 billion bytes) which differed from the binary definition (equal to approximately 1.073 billion bytes) that was used by computer operating systems.  Slip op., at 2.  Eventually the matter settled, on the following terms:

For disc drives purchased before January 1, 2006, class members could choose either a cash payment equal to 5 percent of the net purchase price, or the Seagate Software Suite (the Software) that would allow users to perform enhanced computer and disc management functions. The estimated average cash benefit payable per hard drive was $7, and the Software had an estimated retail value of approximately $40. For disc drives purchased after January 1, 2006, when the packaging included more precise disclosures added by Seagate, class members were entitled to receive the Software.

Slip op., at 3.  One objection was filed.  The objector contended that "the notices of settlement were insufficient and inconsistent with the agreement.  He claimed it was not possible to determine 'whether someone who purchased a Seagate Hard Drive (‘Drive’) from a retailer that is not a Seagate authorized retailer, but that retailer purchased the Drive from an authorized distributor, is a class member under the
settlement agreement.'"  Slip op., at 4.  In response to the objection, Cho and Seagate agreed that "'the words "authorized retailer or distributor" in the settlement agreement--which are not defined terms--are meant to include drives purchased either directly or indirectly from the Authorized Retailers or
Authorized Distributors listed on the website, meaning that they include retailers who are not themselves listed on the website, but who purchased from one of the entities that are listed on the website. The only excluded resellers are those whose drive sales are of fake, grey market, used, or stolen drives.'"  Slip op. at 4-5.  The tiral court did not find the objector's concerns persuasive:

The trial court overruled Klausner’s objections. The order approving settlement states: “Mr. Klausner’s objection to the term authorized retailers or distributors, the limitation of claims to purchases from authorized retailers or distributors, and his related claims that the class is impermissibly narrowed, that plaintiff’s counsel have not adequately represented the class and the plaintiff is an inadequate class representative are overruled. The court finds that it is appropriate to limit the class to purchasers from authorized retailers or distributors. . . . The Court received no information that any class member, other than Mr. Klausner, was confused by the term authorized retailer or distributor. In that regard, neither the Agreement nor the form of notice caused any prejudice to the Plaintiff Settlement Class.” Klausner was granted leave to file his additional objections, which were overruled, but his request to undertake discovery was denied.

Slip op., at 6.  After discussing the current authority governing the review of class action settlements, the Court of Appeal concluded that mere inferences of collusion, with nothing more than accusations to support them, would not be considered:

There is no evidence that the parties to the settlement were intentionally deceptive or that they tried to mislead the court in seeking approval. We will not indulge Klausner’s suggestion that approval be reversed on the basis of misconduct by counsel.

Slip op., at 10.  On the other hand, the Court of Appeal was concerned about ambiguity in the Notice to the class:

A class definition that is ambiguous presents a problem of class ascertainability that “ ‘goes to the heart of the question of class certification, which requires a class definition that is “precise, objective and presently ascertainable.” ’ ” (Global Minerals & Metals Corp. v. Superior Court (2003) 113 Cal.App.4th 836, 858.) In the absence of an ascertainable class, “ ‘it is not possible to give adequate notice to class members or to determine after the litigation has concluded who is barred from relitigating.’ ” (Ibid.) The goal in defining the class is to use terminology that will convey sufficient meaning to enable persons hearing it to determine whether they are members of the class plaintiff wishes to represent.

Slip op., at 12.  Applied to the facts of the case before it, the Court of Appeal said:

We have no disagreement with the parties’ objective and no quarrel with the trial court’s finding that exclusion of “those who purchased outside of Seagate’s authorized retail channels” is “rationally based on legitimate considerations.”  The problem is that a fair reading of the class definition and the notice has the potential to lead some of those who purchased within Seagate’s authorized retail channels to conclude they are not members of the class.

Slip op., at 13.  The Court of Appeal then clarified that the defect in the Notice was not fatal to the settlement and vacated the trial court's Order approving the settlement so that a revised Notice could issue to the class.

The final issue, Klausner's request for discovery, was quickly rejected by the Court of Appeal.  The Court noted that objectors are not entitled to discovery unless some evidence of collusion existed.  Because Klausner presented no evidence to the trial court, the Court of Appeal affirmed the trial court's decision to deny discovery rights to the objector.

In Cartwright, et al., v. Viking Industries, Inc., District Court certifies consumer class action claims under UCL, CLRA, fraudulent concealment and unjust enrichment theories

On September 11, 2009, the United States District Court, Eastern District of California, issued a substantial class certification opinion in Cartwright, et al. v. Viking Industries, Inc. Cartwright is a consumer class action alleging that certain Viking windows are defective, allowing water and air intrusion into homes. The suit alleged claims for Strict Products Liability, Negligence, Breach of Express Warranty, Breach of Implied Warranty, Violation of the Consumer Legal Remedies Act (“CLRA”), Violation of California’s Unfair Competition Law (“UCL”), Fraudulent Concealment, and Restitution.

The District Court ultimately certified a class for the following claims: CLRA, UCL, fraudulent concealment and unjust enrichment. The District Court denied certification of strict liability and negligence claims. In a thorough opinion that emphasizes a number of pro-consumer certification decisions, the Court certified fraudulent concealment claims by allowing a presumption of reliance. The Court's analysis is as interesting for what it does not cite as for what it does cite. Tobacco II is not mentioned. But the Court does cite Mazza v. Am. Honda Motor Co., 254 F.R.D. 610 (C.D. Cal. 2008), which is currently on appeal to the Ninth Circuit following a 23(f) Petition for Permission to Appeal, and Chamberlan v. Ford Motor Corp., 223 F.R.D. 524, 526-27 (N.D. Cal. 2004).

The Opinion also cites to some principles of federal certification that may be surprising to practitioners that rarely venture outside of California's Superior Court. For instance, the Court notes that evidence inadmissible at trial, and, in particular, expert testimony, may be considered as part of a certification decision. "'On a motion for class certification, the court may consider evidence that may not be admissible at trial.'" Order, citing Mazza, 254 F.R.D. at 616 (citing, in turn, Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 178 (1974)). "'[R]obust gatekeeping of expert evidence is not required; rather, the court should ask only if expert evidence is "useful in evaluating whether class certification requirements have been met."' Ellis v. Costco Wholesale Corp., 240 F.R.D. 627, 635 (N.D. Cal. 2007)."

Now let's see if the acrobat.com embed object will display here:

If you don't see the flash object above, you can directly download the Order. Thanks to Mark Moore for the tip.

Every now and then the question "Where are the bodies buried?" turns out to be legitimate discovery

If you dig deep enough in litigation, you may get down to the real dirt.  But if your class action alleges desecration of human remains, you don't have to dig too deep to uncover the grave truth.  In Sands v. Service Corporation International, a putative class action filed September 10, 2009 in Los Angeles County Superior Court, it is alleged that Defendants:

1. Secretly broke and opened interment vaults;
2. Secretly dumped and desecrated human remains, including but not limited to skulls, from interment vaults that were improperly broken or opened, in order to cover up their wrongful acts;
3. Secretly interred humans remains in locations other than the plot in which the remains were to be properly interred;
4. Secretly plotted and sold interment plots on top of already scattered human remains, and thereafter secretly interred the recently deceased on top of those scattered human remains;
5. Secretly “lost” the human remains of individuals without disclosing to family members or others that the deceased was not in fact interred in his or her designated plot;
6. Secretly interred individuals in the wrong plots;
7. Intentionally, recklessly, and/or negligently misinformed family members of the deceased as to the state and condition of interment plots, vaults, interments, and human remains; and
8. Intentionally, recklessly, and/or negligently published, disseminated, circulated and/or placed before the public, either directly or indirectly, statements that were untrue, deceptive and/or misleading regarding the business patterns and practices at Eden Memorial Park.

Complaint.  But it gets better (or worse).  According to Fox News Los Angeles, a former cemetery worker has come forward with allegations that body parts from overcrowded gravesites were routinely discarded.  Isn't nice to see how we all pull together in tough economic times and place family at the center of our priorities?

The first class actions I ever worked on were cemetery class actions.  No other type of misconduct seems to hurt more people in a more personal way than when they learn that the remains of their loved ones were discarded with the trash.  Things like this shouldn't still be happening.

Brinker gets a little bit closer to the finish line

So Brinker Restaurant v. Superior Court (Hohnbaum) moves a bit closer to the light at the end of the tunnel.  After extensions were granted, the Petitioner and the Real Parties in Interest will both file their consolidated answers to amicus briefs on October 8, 2009.  But that's no small task; by my quick count, there are 22 amicus briefs filed in Brinker (view the docket).  That's twenty-two, give or take, in case you thought I double-clutched on the keyboard.  I'd say good cause exists for an extension to file consolidated answers.  Now, without having seen the amicus briefs, what do think the odds are that most of those amicus briefs (1) do nothing but repeat arguments that were in the 100+ page briefs by the parties, and/or (2) repeat other amicus briefs?  My bet is that about 90% of the amicus briefing from both sides could be run through a shredder with no loss of any argument.

Turning back to the timetable for resolution, imagine that you are a research attorney at the Supreme Court.  Imagine you have cases to review aside from Brinker.  Imagine you receive a couple of briefs in the 125-page range and around 22 amicus briefs.  Imagine they fall on you and crush your spine.  How long do you think it would take you to work up a draft opinion with a Justice?  Factor in the holidays, and I now think that my estimate of oral argument in March 2010 is a very optimistic.  I'm officially adjusting The Complex Litigator's Brinker Opinion Release Date from June 2010 to August 2010.  I should work up a graphic for this, like "Stormwatch Winter 2009" or "Firestorm!"  It will need shading and some sort of 3-D effect.

Update on 2009-09-15 07:18 by The Complex Litigator

And we have a logo.  Look for this striking image as a clue to breaking news about Brinker.  I know I promised something with a strange 3-D effect, but the American flag motif captures the spirit of this epic struggle.

SquareSpace releases its iPhone application

And this is my first post with that new application. SquareSpace iPhone application, where have you been all my life?

Update on 2009-09-11 18:37 by The Complex Litigator

Just make sure you watch out for those helpful auto-correct actions on your iPhone or you may not post the post you intended to post (writing "it's" instead of "its" in a headline).

Update on 2009-09-11 23:41 by The Complex Litigator

The version I have is a beta accidentally released by Apple. SquareSpace is working with Apple to get the correct version up in the iTunes App Store.