Articles Posted in California Courts of Appeal

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Google agreed with competitors, such as Apple, not to initiate contact to recruit each others' employees. In 2010, the Department of Justice filed a civil antitrust action, alleging that the agreements illegally diminished competition for tech employees, denying them job opportunities and suppressing wages. On the same day, the companies entered into a stipulated judgment, admitting no liability but agreeing to an injunction prohibiting the "no cold call" arrangements. Google posted a statement online announcing the settlement and denying any wrongdoing, with a link to a Department of Justice press release, describing the settlement terms. There was widespread media coverage. In 2011, class action lawsuits were filed against the companies by employees who alleged that the cold calling restrictions had caused them wage losses. A consolidated action sought over $3 billion in damages on behalf of more than 100,000 employees. A derivative suit, filed by shareholders in 2014, claimed that the company suffered financial losses resulting from the antitrust and class action suits and that the agreements harmed the company’s reputation and stifled innovation. Based on a three-year statute of limitations, the trial court dismissed. The court of appeal affirmed, finding the suit untimely because plaintiffs should have been aware of the facts giving rise to their claims by at least the time of the Department of Justice antitrust action in 2010. View "Police Retirement System of St. Louis v. Page" on Justia Law

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Plaintiff filed a putative class action against TAXI and its CEO, alleging that TAXI operated a talent listing service without procuring the bond California's Fee-Related Talent Services Law (FTSL) requires. The Court of Appeal affirmed the trial court's grant of summary judgment for defendants, holding that plaintiff's FTSL claim amounted to no more than an assertion that he was injured by TAXI's noncompliance with the FTSL. However, mere noncompliance was not an injury caused "by a violation" of the FTSL. The court also held that plaintiff's evidence also failed to raise a triable issue of material fact as to whether he suffered an economic injury caused by TAXI's alleged violations of the FTSL, which he must have to establish standing to sue under California's Unfair Competition Law. View "Demeter v. Taxi Computer Services" on Justia Law

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Aerotek provided temporary employees to Bay Bread. The temporary employees worked “under [Bay Bread’s] management and supervision.” Bread agreed to comply with federal, state, and local laws. Aerotek’s meal break policies were contained in an employee handbook, which stated that any problems should be discussed with supervisors. Bread set the temporary employees' schedules; they took their meal breaks to “ensur[e] that everyone got an uninterrupted meal break by the time five hours of their shift elapsed” based on “when things needed to come in and out of the oven.” Aerotek’s on-site account manager, Scott, visited the production facility twice daily but did not look for meal break issues. Aerotek hired Serrano as a temporary Bread employee; she acknowledged receipt of Aerotek’s employee handbook and signed forms waiving a meal period on days she worked no more than six hours. When she worked more than six hours, she sometimes took her meal breaks more than five hours after beginning work or did not take them. She never discussed the issue with Scott. Serrano filed a putative class action for failure to provide meal periods (Labor Code 226.7, 512), failure to pay wages upon termination, unfair competition, and Private Attorneys General Act penalties. The court of appeal affirmed a judgment for Aerotek. Proof that an employer had knowledge of employees working through meal periods will not alone subject the employer to liability; an employer is not required to “police” meal breaks. View "Serrano v. Aerotek, Inc." on Justia Law

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Aerotek provided temporary employees to Bay Bread. The temporary employees worked “under [Bay Bread’s] management and supervision.” Bread agreed to comply with federal, state, and local laws. Aerotek’s meal break policies were contained in an employee handbook, which stated that any problems should be discussed with supervisors. Bread set the temporary employees' schedules; they took their meal breaks to “ensur[e] that everyone got an uninterrupted meal break by the time five hours of their shift elapsed” based on “when things needed to come in and out of the oven.” Aerotek’s on-site account manager, Scott, visited the production facility twice daily but did not look for meal break issues. Aerotek hired Serrano as a temporary Bread employee; she acknowledged receipt of Aerotek’s employee handbook and signed forms waiving a meal period on days she worked no more than six hours. When she worked more than six hours, she sometimes took her meal breaks more than five hours after beginning work or did not take them. She never discussed the issue with Scott. Serrano filed a putative class action for failure to provide meal periods (Labor Code 226.7, 512), failure to pay wages upon termination, unfair competition, and Private Attorneys General Act penalties. The court of appeal affirmed a judgment for Aerotek. Proof that an employer had knowledge of employees working through meal periods will not alone subject the employer to liability; an employer is not required to “police” meal breaks. View "Serrano v. Aerotek, Inc." on Justia Law

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Plaintiff Franklin Eng appealed a judgment in favor of defendants Michael Patrick Brown and Gerald Levy following a jury trial. Eng claimed that Brown and Levy breached their fiduciary duties to him as purported partners or joint venturers in the ownership and operation of the Tin Fish Gaslamp, a seafood restaurant in San Diego. The jury found that Eng, Brown, and Levy entered into a partnership or joint venture, but it was terminated when they formed a corporation, B.L.E. Fish, Inc. to purchase and operate the restaurant. Eng's claim for breach of fiduciary duty based on a partnership or joint venture was therefore unsupportable. Eng argued on appeal that, among other things:(1) the trial court erred by denying his request, in a motion in limine, that the court find that the parties created a partnership as a matter of law; (2) the court erred by denying his motion in limine seeking to exclude any evidence or argument that B.L.E. Fish merged with or superseded the partnership; (3) the court erred by granting Brown and Levy's motion to amend their answer to assert an affirmative defense based on merger or supersession; (4) the court erred by denying Eng's motion for directed verdict; (5) the court committed instructional error (and a related error in the special verdict) regarding merger and supersession; (6) the court erred in its response to a juror question during deliberations; (7) the court erred by denying Eng's motion to amend his complaint to add a claim for breach of fiduciary duties based on the parties' corporate relationship; (8) the court erred by denying Eng's motion to strike the testimony of a defense expert witness; and (9) the court erred by denying Eng's ex parte application for the release of juror contact information. Finding no reversible errors, the Court of Appeal affirmed. View "Eng v. Brown" on Justia Law

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GMRI, Inc. a restaurant operator, appealed a judgment entered in favor of the State Board of Equalization (the Board) after the trial court granted the Board’s summary judgment motion. Between 2002 and 2004 (period in dispute), GMRI operated Olive Garden and Red Lobster restaurants in California. Customers of these restaurants were notified on their menus that an “optional” gratuity of either 15 or 18 percent (depending on which restaurant and time period within the period in dispute) “will be added to parties of 8 or more.” When it was added, a manager was required to swipe his or her manager’s card through the restaurant’s point- of-sale (POS) system and then manually add the gratuity to the bill. The bill generated and presented to the customer would then contain the total cost of the meal, the applicable tax, the amount of the large party gratuity added by the manager, and the sum of these amounts as the total amount to be paid. In line with the word “optional,” the Company’s policy was that its restaurant managers would always remove a large party gratuity if asked by the customer to do so. However, unless such a request was made, the large party gratuity would remain on the bill as a portion of the total amount. And where that customer paid with a credit card, the credit card slip would contain the amount of the meal plus tax, the amount of the large party gratuity, the total amount, and then a blank line designated, “Add’l Tip,” followed by another blank line designated, “Final Total.” The trial court concluded a 15 or 18 percent gratuity restaurant managers automatically added to parties of eight or more without first conferring with the customer amounted to a “mandatory payment designated as a tip, gratuity, or service charge” under California Code of Regulations, title 18, section 1603 (g), and therefore part of the Company’s taxable gross receipts, in one circumstance: where the large party gratuity was added and neither removed nor modified by the customer. Finding no error in affirming the Board's decision, the Court of Appeal affirmed the trial court. View "GMRI, Inc. v. CA Dept. of Tax & Fee Admin." on Justia Law

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The 2016 amendment to Corporations Code section 17707.06 applied to a certificate of cancellation filed by plaintiff in 2014. The Court of Appeal held that plaintiff concealed the certificate of cancellation and then unsuccessfully challenged its authenticity, prolonging the proceedings into 2016 when the changes to section 17707.06 took effect. The court reasoned that, had plaintiff been forthcoming, the case would have been dismissed under the prior law. In this case, it would be unfair to reward plaintiff's delay by allowing it to take advantage of the 2016 law. View "DD Hair Lounge v. St. Farm General Insurance Co." on Justia Law

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The Court of Appeal reversed the judgment of dismissal entered after the trial court sustained without leave to amend the demurrer of Trader Joe's to plaintiff's first amended complaint. The court held that plaintiff adequately stated a cause of action for intentional interference with contractual relations. The court reasoned that one, like Trader Joe's here, who was not a party to the contract or an agent of a party to the contract was a "stranger" for purpose of the tort of intentional interference with contract, and plaintiff need not allege an independently wrongful act to state his cause of action for interference with contract. The court held that plaintiff adequately stated causes of action for intentional and negligent interference with prospective economic advantage. View "Redfearn v. Trader Joe's Company" on Justia Law

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The Court of Appeal reversed the judgment of dismissal entered after the trial court sustained without leave to amend the demurrer of Trader Joe's to plaintiff's first amended complaint. The court held that plaintiff adequately stated a cause of action for intentional interference with contractual relations. The court reasoned that one, like Trader Joe's here, who was not a party to the contract or an agent of a party to the contract was a "stranger" for purpose of the tort of intentional interference with contract, and plaintiff need not allege an independently wrongful act to state his cause of action for interference with contract. The court held that plaintiff adequately stated causes of action for intentional and negligent interference with prospective economic advantage. View "Redfearn v. Trader Joe's Company" on Justia Law

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Petitioner Apple, Inc. (Apple) is the defendant in a putative class action filed by plaintiffs and real parties in interest Anthony Shamrell and Daryl Rysdyk. In their operative complaint, plaintiffs alleged that Apple's iPhone 4, 4S, and 5 smartphones were sold with a defective power button that began to work intermittently or fail entirely during the life of the phones. Plaintiffs alleged Apple knew of the power button defects based on prerelease testing and postrelease field failure analyses, yet Apple began selling the phones and continued to sell the phones notwithstanding the defect. The trial court granted plaintiffs' motion for class certification but expressly refused to apply Sargon Enterprises, Inc. v. University of Southern California, 55 Cal.4th 747 (2012) to the declarations submitted by plaintiffs' experts. The trial court believed it was not required to assess the soundness of the experts' materials and methodologies at this stage of the litigation. The Court of Appeals determined that belief was in error, and a prejudicial error. “Sargon applies to expert opinion evidence submitted in connection with a motion for class certification. A trial court may consider only admissible expert opinion evidence on class certification, and there is only one standard for admissibility of expert opinion evidence in California. Sargon describes that standard.” The Court of Appeal directed the trial court to vacate its order granting plaintiffs' motion for class certification and reconsider the motion under the governing legal standards, including Sargon. View "Apple Inc. v. Superior Court" on Justia Law