Attorney disqualification is improper remedy for failure to produce documents and respond to subpoena

The Second District, Division Seven, has ruled that while an attorney who fails to produce documents and/or produce a privilege log may be subject to sanctions, or perhaps even referral to the State Bar, a trial court erred when it instead disqualified said counsel from representing one of the parties. (Sunholm v. Hollywood Press Association (February 27, 2024) B324842.)  This is true even though the document withheld may have contained the other party's privileged information and, further, the to-be disqualified counsel was less than forthright about whether he currently possessed privileged material.

In Sundholdm privileged documents were accidentally filed and served upon counsel for plaintiff, who had sued the Holywood Foreign Press Association after he was expelled.  HFPA mistakenly attached a draft copy of its by-laws to its complaint notwithstanding that these by-laws were marked as attorney-client privileged material.  HFPA made an ex parte application to strike these by-laws from the record, which request was granted.  An amended complaint was then filed with the final version of the by-laws attached, as these did not contain any privileged material.  

Counsel Quinto of One LLP, attorney for plaintiff Sundholm, was then the subject of a motion to disqualify brought by the HFPA after it was alleged that he had, inter alia, 1) kept a copy of the privileged material, and 2) failed to respond to a deposition subpoena to produce documents including the privileged material.  This motion to disqualify of HFPA was made alongside its motion to compel production of the document which Quinto possessed and coyly said might be privileged.  Sundholm then sought to dismiss the remainder of his complaint against HFPA to avoid either motion being granted.  

Wendy W. Y. Chang, Judge presiding of the Superior Court of Los Angeles County, found the court lacked jurisdiction to consider the motion to compel due to the dismissal of the remainder of the complaint. The trial court nonetheless held it could rule upon the motion to disqualify and granted said motion.

The appellate court overturned the trial court’s grant of the motion to disqualify, not because it endorsed Quinto’s conduct, but because such was not the proper remedy for Quinto’s action.  In an opinion written by Justice Feuer, the court held:

We agree with the trial court that Quinto improperly refused to produce documents in response to a subpoena from HFPA seeking HFPA documents in Quinto’s possession that were privileged or to provide a privilege log. But disqualification of an attorney affects a party’s right to counsel of choice, and it should not be used to punish an attorney for improper conduct. Quinto’s conduct could have been addressed by an award of sanctions or, if appropriate, reporting the conduct to the State Bar of California. The drastic remedy of disqualification of counsel is appropriate only where the attorney improperly or inadvertently received information protected by the opposing party’s attorney-client privilege, the information is material to the proceeding, and its use would prejudice the opposing party in the proceeding. Here, there was no showing the HFPA documents would prejudice HFPA in the proceeding. We reverse. (Id., p. 2.)

Key to the court’s finding the trial court erred was the drastic nature of the remedy of disqualification of counsel.  The Second District explained disqualification is appropriate only where the following test is met: 1) opposing counsel improperly or inadvertently receives information protected by the opposing party’s attorney-client privilege, 2) the information is material to the proceeding itself, and 3) use of such by opposing party would result in actual prejudice of party seeking disqualification.  HFPA, however, could not establish it suffered prejudice from the retention of the privileged material given the suit against it was dismissed.

Analysis: mistakes — whether inadvertent or intentional — were made by counsel for both parties

Counsel for HFPA — Robert Ellison— admitted that a draft copy of the by-laws which included attorney-client privileged information was filed with the Court and served on opposing counsel.  Though swiftly corrected, this was a potential breach of the duty of due care owed to the client, necessitating the ex parte application to strike this matter.

At the same time, counsel for Quinto failed to either produce the privileged document or produce a privilege log detailing what document was being withheld.

Unresolved ethical issues, including “back ups” of information which should be "returned"

The Court of Appeal found that because HFPA could not establish prejudice from the retention of the privileged information, it did not need to consider whether Quinto acted unethically.  However, as the Court of Appeal explained at footnote six, the scenario in Sundholm implicates the ethical duty of counsel to disclose and possibly return inadvertently-disclosed privileged material:   

              

Pursuant to State Fund, supra, 70 Cal.App.4th at pages 656 to 657, “When a lawyer who receives materials that obviously appear to be subject to an attorney-client privilege or otherwise clearly appear to be confidential and privileged and where it is reasonably apparent that the materials were provided or made available through inadvertence, the lawyer receiving such materials should refrain from examining the materials any more than is essential to ascertain if the materials are privileged, and shall immediately notify the sender that he or she possesses material that appears to be privileged. The parties may then proceed to resolve the situation by agreement or may resort to the court for guidance with the benefit of protective orders and other judicial intervention as may be justified. We do, however, hold that whenever a lawyer ascertains that he or she may have privileged attorney-client material that was inadvertently provided by another, that lawyer must notify the party entitled to the privilege of that fact.” (See Rico v. Mitsubishi Motors Corp. (2007) 42 Cal.4th 807, 817-818 [adopting the State Fund holding and extending it to material protected by the work product doctrine].) 

The opinion therefore does not provide sufficient guidance to say with certainty whether or not Quinto acted unethically, instead merely hinting that he may have.  The appellate court also did not discuss the issue of what is to occur after a party notifies the other party it has inadvertently received privileged material.  

In the analog era, of course, the answer was often that the party “returns” the privileged material to the party who inadvertently disclosed such. As California Rules of Professional Responsibility, Rule 4.4, comment [1] states:

[1] If a lawyer determines this rule applies to a transmitted writing,* the lawyer should return the writing* to the sender, seek to reach agreement with the sender regarding the disposition of the writing,* or seek guidance from a tribunal.* (See Rico v. Mitsubishi (2007) 42 Cal.4th 907. . . .

But what does this mean in the digital era?  

Even if a document is “returned” to its sender, it most likely has already been scanned.  Moreover, even if it has ostensibly been “deleted,” a copy of the privileged material may be saved on a local or remote backup server.

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Short take-away -- "friends with benefits" may not may not qualify as a "dating relationship" under California law

A "friends with benefits" relationship may or may not qualify as a "dating relationship" under California law for purposes of application of domestic violence law. (M.A. v. B. F. (February 5, 2024) G061598.)  The Fourth District Division Three summarized the issue and its holding as follows:

We are asked here to determine whether a relationship characterized in modern parlance — and by the plaintiff in this case — as “friends with benefits” constitutes a dating relationship under Family Code section 6210, so as to support a tort claim for domestic violence. Whether such a dating relationship exists is inherently a fact-intensive inquiry, not susceptible to resolution based on shorthand labels or descriptors. We therefore do not hold a “friends with benefits” relationship is necessarily a dating relationship or that it can never be one. We simply conclude, on the specific record before us, substantial evidence supports the trial court’s finding that the relationship between plaintiff M.A. and defendant B.F. was not a dating relationship within the meaning of the relevant statutes. We affirm. (Id., pp. 1-2.)

This issue arises because California's Civil Code section 1708.6(a) provides the tort of "domestic violence" requires a "relationship."  Further, Penal Code section 13700 defines domestic violence to include "dating or engagement relationship" and Family Code section 6210 has a similar definition.

The majority in M.A. affirmed the trial court's judgment in favor of B.A. under a "substantial evidence" standard of review, showing deference to its review of the evidence.  It therefore found the trial court had the discretion to find, or, in the case here, to not find, a "friends with benefits" situation involved a "relationship," noting "different inferences" could be drawn from the facts. (Id., p. 13.)  The majority also noted section 6210 uses the phrase "frequent, intimate associations” but does not define such.

Justice Sanchez dissented from the majority opinion written by Justice Gooding.  The dissent concluded that under the facts here plaintiff M.A. fell under "the category of victims the law was meant to protect" no matter the on-and-off nature of the encounters between her and defendant. (Id., p. 6.)

What the opinion does not explain

It is unclear from the record here why the plaintiff did not also bring a tort claim for assault and battery or other related torts, which claims do not require she prove the parties were in a "relationship."  It is, for example, unclear from the opinion whether such a claim would be time-barred.  Footnote seven only states that:

We note M.A. had remedies available to her under the law to seek redress for her injuries, including tort claims against B.F. for assault and battery. 

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Court, not arbitrator, decides whether minor may disaffirm contract including arbitration provision

 

Class action suit by minors alleging deceptive practices in "in app" purchases may proceed despite the fact the videogame license came with arbitration provision

A minor, of course, may affirm or disaffirm a contract once they reach the age of majority. (Family Law Code sections 6700 and 6710.)  This is to protect minors from "their lack of judgment and experience. . . ." (Sparks v. Sparks (1950) 101 Cal. App. 2d 129, at 137.)  

California's Second District, Division Six, has upheld the role of a trial court in determining whether a minor has disaffirmed a contract made by said minor. (J.D. v. Electronic Arts (January 17, 2024) E080414.)  The appellate court summarized the complaint and challenges to such as follows:

On February 14, 2022, J.R. II filed a putative class action against EA, alleging causes of action for unlawful and unfair business practices in violation of the Unfair Competition Law (Bus. & Prof. Code, § 17200 et seq.), violation of the Consumer Legal Remedies Act (Civ. Code, § 1750 et seq.), and unjust enrichment.  J.R. alleged that EA deceptively induced players of Apex Legends, “especially impressionable minors,” to purchase digital game-specific currency in order “to purchase cosmetic items, characters, lootboxes, and other items within the Apex Legends virtual world.”
EA moved to stay the action and to compel arbitration under Code of Civil Procedure sections 1281.2 and 1281.4, arguing that J.R. II’s claims are covered by an arbitration agreement contained within EA’s user agreement, which J.R. II agreed to in order to play Apex Legends. (Id., p. 1.)

Finding it had the authority to decide whether J.R. disaffirmed the contract with EA, the trial court found he had done so according to the declaration he had submitted in opposition to the motion.  The Hon. Craig Riemer, Judge Presiding of the Riverside County Superior Court, thus denied EA's motion to compel contractual arbitration under the rules of the American Arbitration Association; therefore permitted the class action to proceed.

EA appealed and argued that because the contract provided arbitration should proceed according to the rules of the AAA, the arbitrator must decide the issue of whether J.R. disaffirmed all or part of the agreement to arbitrate.  J.R. argued that he had disaffirmed the entire user agreement, including the "delegation clause" regarding arbitration, and argued the trial court had the authority to decide this issue.

In an opinion written by Justice Menetrez, the Second District found J.R.'s declaration provided that he had in fact disaffirmed the entire contract, including the delegation provision.  The court also explained the delegation provision was severable from the remainder of the contract and that the disaffirmance of this provision was valid no matter whether defenses to other parts of the agreement were valid.    

Analysis

This opinion continues the California trend of the increasing role of trial courts supervising private arbitration and, indeed, in deciding major legal issues related to what can or cannot be arbitrated.  Put another way, the time in which a trial court was more likely to have the arbitrator decide all issues related to contractual arbitration appears to be long passed. 

This suit also illustrates the dangers inherent in the apparently lucrative business of encouraging minors to make in-app purchases without the permission of their parents.

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One-year MICRA Statute of Limitations Applies to Claim Against Ambulance Driver Who Read-Ended Another Motorist (Gutierrez v. Tostado)

 

The one-year Statute of Limitations in California's MICRA regime bars untimely claim against driver of ambulance who rear-ended third-party motorist while transporting another patient

Plaintiff Gutierrez was driving on the I-280 when he was rear-ended by an ambulance driven by defendant Tostado.  The driver and ambulance operator brought a motion for summary judgment based on the statute of limitations found in California's Medical Injury Compensation Reform Act (MICRA).  This statute was passed by the voters in 1975 and limits the amounts recoverable due to alleged negligence in providing medical services.  

The Hon. Christopher J. Rudy of the Santa Clara County Superior Court granted the motion.  On appeal, the Sixth Appellate District upheld the grant of summary judgment over the dissent of one Justice. (Gutierrez v. Tostado (December 1, 2023) H049983.)

Upon appeal, the issue was whether the one-year MICRA statute of limitations found in Code of Civil Procedure section 340.5, as opposed to the general two-year statute of limitations for tort actions, applied.  In other words, did MICRA's provisions apply where the negligence of medical providers was directed at a non-patient such as fellow motorist Gutierrez, who just happened to be driving in front of defendants' ambulance?

 

Justice Greenwood, joined by Justice Grover, wrote for the majority and found that because Tostado was driving the ambulance he was providing "professional [medical] services" at the time of the accident.  Therefore, the time limitations found in MICRA applied.  This is important because under case law such as Flores v. Presbyterian Intercommunity Hospital (2016) 63 Cal. 4th 75, at 88, only actions “alleging injury suffered as a result of . . . the provision of medical care to patients” are subject to MICRA. (Gutierrez, p. 3; italics added.)

The majority answered this question affirmatively and cited to Canister v. Emergency Ambulance Service, Inc. (2008) 160 Cal. App. 4th 388, at 407, where the MICRA one-year limit applied to injury to someone injured while riding in an ambulance who was not a patient.  As Gutierrez explained at pages five to six, the MICRA time limit applied to someone not receiving medical service but who was nonetheless still injured as a result of negligence in providing such services:

 

In Canister, a police officer accompanying an arrestee in the back of an ambulance was injured when the ambulance hit a curb. At the time of the accident, the ambulance was being driven by one EMT while another attended to the arrestee in the rear of the ambulance. The officer sued for negligence. (Canister, supra, 160 Cal.App.4th at p. 392.) After finding that an EMT was a health care provider and that transporting a patient constituted professional services within the meaning of MICRA, the Canister court held that MICRA extends to “ ‘any foreseeable injured party, including patients, business invitees, staff members or visitors, provided the injuries alleged arose out of professional negligence.’ [Citation.]” (Id. at pp. 407-408.) The court concluded that it was foreseeable as a matter of law that a police officer accompanying an arrestee in an ambulance might be injured in the operation of the ambulance. (Id. at p. 408.)

 

Justice Bromberg dissented and wrote that neither the plaintiff nor the defendants could have anticipated that MICRA would apply in this situation, i.e., "a run-of-the-mill traffic accident involving an ambulance that happened to be transporting a patient on a non-emergency matter, presumably with its siren off." (Gutierrez dissent, p. 2.)  The dissent also noted the plaintiff's lawyers were unlikely to know that MICRA applied to his claim because in 1982 the MICRA provisions specifically related to paramedics were removed. (Gutierrez dissent, p. 4.)  Moreover, at the time MICRA was enacted the general statute of limitations for tort claims was one-year, meaning MICRA was not intended to shorten the time to bring claims. Rather, its purpose was to reduce the amount of monetary awards for medical malpractice to prevent a reduction in affordable and available medical care to the public.

Further review of Gutierrez

This case may ultimately be headed to the California Supreme Court, given that the case law cited by the majority and dissent lacks harmony as to when MICRA does or does not apply.

It should also be noted that earlier this year MICRA was amended by the California legislature.  The original $250,000 "cap" on claims for professional medical negligence was increased.  Wrongful death claims from medical malpractice are now "capped" at $500,000 and this amount will increase by $50,000 each January until the maximum is $1,000,000.  For other claims, the "cap" is $350,000, with yearly increases of $40,000 until the new limit reaches $750,000.

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Update - California Appellate Trends for 2023

Two words come to mind in summing up trends in appellate law for the past year: stability and continuity.  Neither the California Supreme Court nor the six District Courts of Appeal veered off in a totally surprising direction.  Indeed, the Supreme Court issued a relatively modest 55 total majority opinions - this being modest in total number but not necessarily in terms of the breadth of the opinions - for the legal year 2022-2023.

Despite the trend toward stability and continuity, we do have a new Supreme Court Chief Justice, the Hon. Justice Patricia Guerrero.  She was nominated by Governor Newsome as Chief Justice and was elected by the people on November 8, 2023. Justice Guerrero replaces the well-regarded Justice Tani G. Cantil-Sakauye, who served as a Chief Justice for 12 years.  The former Chief Justice spent the last few years navigating the pandemic and the resulting closing and re-opening of our courts and the resulting modifications of California judicial procedure.  

Some relatively straightforward trends continued this year, including strictly holding arbitrators to the relevant standards related to disclosure, bias, misconduct, etc.  The days when trial courts might "rubber stamp" an arbitration award and fail to seriously consider allegations against the arbitrator and the parties would then expect an appellate court to defer to the trial court's confirmation of the arbitration award are largely gone. (See, e.g,., FCM v. Grove Phan, holding an adverse credibility determination based largely upon the need for a translator constituted "bias" by the arbitrator)

California courts are also working through a host of issues related to COVID-19 and coverage.  For example, Endeavor v. HDI Global held that a standard liability policy did not cover losses from the pandemic because there was no "direct" physical loss or damage.

Indeed, this very issue is now pending before the California Supreme Court in Another Planet Entertainment, L.L.C. v. Vigilent Insurance Co., wherein the Ninth Circuit Court of Appeal certified the following question:

Can the actual or potential presence of the COVID-19 virus on an insured’s premises constitute ‘direct physical loss or damage to property’ for purposes of coverage under a commercial property insurance policy?

For a preview of the next term of the California Supreme Court, please see the court's summary of pending cases.

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Post-trial civil procedure - Defense May Have to Pay Cost of Proof Sanctions for Failing to Stipulate to Medical Records as "Business Records" (Vargas v. Gallizzi)

 

Post-trial civil procedure - defense failure to stipulate to the authenticity of medical records as "business records" entitles plaintiffs to claim the cost of having to prove their admissibility

Division Seven of the Second Appellate District of California has upheld and reversed post-trial orders by the Hon. Graciela L. Freixes of the Los Angeles County Superior Court. (Vargas v. Gallizzi (October 13, 2023) B317540.)  Following a prior appellate opinion remanding for a new trial to consider both loss of use and future non-economic damages, plaintiffs prevailed in the second trial and the parties wrangled over who should pay what after trial.  Justice Perluss and his colleagues on the Second District panel affirmed the trial court’s award of costs to the defense based on a successful pre-trial offer to compromise, but reversed the trial court's denial of any of the requested "cost of proof" sanctions to plaintiffs, finding they were entitled to claim the reasonable cost of having to prove matters unreasonably denied by the defense.  The final result is that the defense will owe the plaintiffs $15,125 in damages, plus a to-be-determined amount relating to attorneys fees and costs, while the plaintiffs will owe the defense its allowable costs of suit, or $28,547.66, including $12,000 for a particular expert’s fees for testifying.

What are sometimes called "cost of proof" sanctions may be awarded for the pre-trial costs of proving a matter the other party will not admit 

Vargas explained California's procedure for claiming attorney fees and costs related to factual matters the other party will not admit:

During pretrial discovery a party may serve a written request that another party “admit the genuineness of specified documents, or the truth of specified matters of fact, opinion relating to fact, or application of law to fact.” (§ 2033.010.) Such requests “‘are primarily aimed at setting at rest a triable issue so that it will not have to be tried. Thus, such requests, in a most definite manner, are aimed at expediting the trial. For this reason, the fact that the request is for the admission of a controversial matter, or one involving complex facts, or calls for an opinion, is of no moment. If the litigant is able to make the admission, the time for making it is during discovery procedures, and not at the trial.’” (Id., p. 9; emphasis added but citation omitted.)

Counsel for plaintiffs made multiple attempts to have defense counsel stipulate to the admissibility of medical records, to no avail.  Indeed, defense counsel refused to stipulate that such records were "business records" under Evidence Code section 1271 and therefore twice denied requests for admissions to this effect.  The trial court ultimately settled this contested issue pre-trial by ruling most of the records were in fact "business records:" 

. . . [T]he court heard argument regarding the parties’ motions in limine. . . [and] it appears the admissibility of medical records was argued because the minute order for July 30, 2021 states, “The Court rules that any sealed subpoena records received will be considered as business records. The admissibility of said records is deferred to the time of trial.” 

 

The issue was revisited during trial when Vargas and Garcia’s counsel indicated he would use some of the medical records to refresh Vargas’s recollection during her testimony. Gallizzi’s counsel objected that Vargas could not authenticate the documents and the records contained hearsay. The court responded, “I’ve deemed them not hearsay with regards to authentication and foundation because they were provided . . . as part of the subpoenaed records.” Ultimately the medical records proffered by Garcia and Vargas were admitted into evidence at trial except for approximately 10 pages the court ruled contained hearsay within hearsay. (Id., pp. 5-6.)

After trial plaintiffs brought a motion requesting a staggering $350,000 in attorney fees and costs related to defendant's supposedly “unreasonable” denial of the requests for admissions.  The trial court denied this motion, explaining, inter alia, that the issue of the authenticity of the medical records had been decided before trial and there was therefore no need to expend attorney effort to "prove" such during the actual trial.

The Second District reversed, remanding the matter for reconsideration as to the amount of the attorney fees and costs to be awarded related to the denial of the requests for admissions.  As the appellate court explained, Code of Civil Procedure section 2033.420 does not limit its scope to what is proven "at trial," providing a post-trial award to the party who "thereafter proves the genuineness of that document or the truth of that matter.”  Consequently, a post-trial award may include attorney fees and costs incurred "pre-trial" as part of the "proof" referenced in the statute, including, as was the case in Vargas, efforts in bringing pre-trial motions.

The Vargas court explained that plaintiffs had "proven" the records were business records during the pre-trial hearing and, more to the point, the denial by the defense was not “reasonable:"

. . . [A] defendant ‘cannot be forced to admit [a] fact prior to trial despite its obvious truth. [Citation.]’ [Citation.] But the failure to do so comes with consequences, exposure to a costs of proof award.”  Gallizzi had no reasonably held good faith belief she could prevail on the merits of the business records issue. Her denial rested solely on the potential for opposing counsel’s procedural error. Accordingly, Vargas and Garcia were entitled to recover the reasonable expenses incurred in proving the medical records were business records. (Id., p. 15.)

However, the plaintiffs were not permitted to claim the cost of proving causation at trial

Predictably, counsel also did not permit defendant to admit that she caused "some injury" to either plaintiff.   However, during opening statements defense counsel stated "I believe these ladies were injured."  Nonetheless, plantiffs’ post-trial motion asked for attorney fees and costs related to having prove causation at trial.  The appellate court found the trial court and properly denied this request for “cost of proof” sanctions as the plaintiffs would have had to have proved the amount and severity of their damages no matter what the defenses admitted.

The appellate court also affirmed the award of costs to the defendant

The appellate court also affirmed, with no modifications, the substantial award of costs to the defense.  Plaintiffs rejected an offer to compromise from the defendant made pursuant to Code of Civil Procedure section 998 and apparently "beat" this offer as the verdict at the second trial was less than this offer.

Plaintiffs quibbled with these costs, arguing the fact the defense expert designation stated the cost of testimony would be $6,000 for up to four hours indicated the claimed $12,000 should be reduced; however, as the court noted, the expert at issue testified over two separate days and thus charged a $6,000 minimum each day.  The appellate court also rejected the claim the trial court abused its discretion in awarding the defense the cost of real-time court reporter transcription, explaining "[plaintiffs] have not cited any authority for the proposition that real-time transcription fees are not allowable when deemed appropriate by the trial court." (Id., p. 19.)

Tips for practitioners

This suit illustrates the effect of post-trial motions for sanctions and/or costs of suit in California, including that:

• In addition to any actual damages awarded, parties may recover from the other costs and/or sanctions and each party may therefore have a resulting award against the other; and,
• The result is that the "net" award may be to the defendant, and not the plaintiff, depending on amounts awarded by way of post-trial motion.  

This second point is illustrated in Vargas by the judgment for damages of$15,125 to plaintiffs versus the costs awarded to the defense of $28,547.66.  If the "cost of proof" sanctions are less than this amount, it appears likely the plaintiffs will owe the defendant money following this second trial.  

Practitioners should therefore treat requests for admissions, particularly those related to the introduction of evidence at trial, very seriously.  Matters that are routinely admitted, such as the authenticity and admissibility of documents, should be admitted if it would be unreasonable to deny them.  At the same time, counsel whose clients reject section 998 offers to compromise should be aware of the increasing cost of litigation, including the charges of medical experts, and should take a "ballpark" estimation of these costs, including the cost of any and all experts called by opposing parties, into account when considering whether to reject or accept a statutory offer.

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Short take-away - Website is not a public "place" subject to the ADA and the Unruh Act (Martin v. Thi E-Commerce)

Short take-away - A website with no physical location cannot be sued for failure to fully implement screen reading for blind visitors

Plaintiffs admittedly seek out websites that are not fully accessible to the disabled and therefore sued a website unrelated to the entrance to any physical location, i.e., a "stand alone" e-commerce website.  They alleged the website was not fully compatible with screen-reading technology to assist blind visitors, resulting in a violation of California's Unruh Act barring discrimination based on disability.  More specifically they argued the website is a place of "public accommodation" under the Federal Americans with Disabilities Act ("ADA") and compatibility with screen reading technology was therefore required.

Acknowledging that both Federal and California courts were split as to how to apply the statutory language "place" to a website, the Fourth Appellate District, Division Three, held that a site that exists purely in cyberspace was not a "place" as fined by the ADA. (Martin v. THI Commerce (September 13, 2023) G061234.) 

Acting Presiding Justice Sanchez wrote for the majority and interpreted the phrase "place of public accommodation," as defined in the Americans with Disabilities Act, as excluding websites that have no relation to any physical location.  Therefore, a website not required for entrance to a physical location (in contrast to a website used to make entrance reservations) is not subject to the provisions of the ADA as "the ADA unambiguously requires a physical location." (Martin, p. 2.)  The demurrer sustained by the Hon. Theodore R. Howard of the Orange County Superior Court as to the entire complaint was therefore upheld by the Fourth District.

Justice Delaney dissented, noting that Mirriam Webster's Collegiate Dictionary (2003) provides that "'Place’ includes. . . ‘an indefinite region or expanse.'"  The dissent argued the intent of the ADA was to be applied broadly and the examples given as to places of public accommodation in the statute were meant to be examples only and should not limit its application to future technology. 

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Notwithstanding Federal admiralty law, California worker’s compensation Law applies to Injury at yacht club (Ranger v. Alamitos Bay)

State courts have concurrent tort jurisdiction under admiralty and maritime law but plaintiff is limited to worker’s compensation recovery 

Plaintiff Ranger fell at the Alamitos Bay Yacht Club in Long Beach, California, while lowering a boat into the water.  He sued in state court but his tort claims were dismissed as worker's compensation was determined to be his exclusive remedy. (Ranger v. Alamitos Bay Yacht Club (September 6, 2023) B315302.)  Specifically, the Hon. Mark C. Kim of the Los Angeles County Superior Court sustained, without leave to amend, a demurer on the grounds that plaintiff Ranger could not state a tort claim in California Superior Court.  The Second District, Division Eight, affirmed the trial court but held it did not need to decide the issue of whether or not admiralty jurisdiction applied.

As set forth in both the Constitution and maritime statutes [1], Federal courts have exclusive jurisdiction over certain claims.  At the same time, state courts may adjudicate in personam “maritime claims” as they have “concurrent jurisdiction” over such suits. (Id., p. 2.)  

As the Ranger court explained, this means the issue of whether admiralty jurisdiction applies is “supernumerary,” or excess, to deciding whether California worker’s compensation is the exclusive remedy for a worker such as Ranger injured at a Yacht Club. (Id.)

This is because Ranger was an "employee" excluded from "maritime jurisdiction" under 1984 amendments to the Longshoremen’s and Harbor Worker's Act (“Longshore Act”) found at 33 U.S.C. section 902(3) and (3)(b).  This act established Federal worker’s compensation for what Ranger termed “maritime employment.” (Ranger, p. 3, citing 33 U.S.C. sections 902 and 905.)  More specifically, workers at a “club” are defined as such “employees,” as discussed in more detail below. 

In terms of interpreting this statute vis a vis common law precedent, Ranger explained that while what it called “admiralty courts” [2] are ostensibly “common law” courts, they look primarily to legislative enactments for guidance. (Ranger, p. 3; emphasis deleted.)  At page three, Ranger therefore summarized what it called “admiralty law" including "general maritime law:"

To set out our analysis in more detail, we begin by defining admiralty law. The Constitution implicitly directed courts sitting in admiralty to proceed as common law courts. Where Congress has not prescribed specific rules, these courts developed an amalgam of traditional, modified, and new common law rules. That amalgam is the general maritime law, which is no longer the exclusive province of federal judges. Congress and the states legislate extensively in these areas. When exercising their common law authority, admiralty courts look primarily to legislative enactments for policy guidance. (Citations omitted.)

Key to deciding Ranger were the 1984 amendments to the Longshore Act.  This act excluded many persons defined as an “employee” from Federal worker’s compensation, expressly providing the employee of a “club” is such an excluded employee:

In 1984, Congress responded by introducing a degree of clarity: Congress sharpened the Longshore Act’s focus to exclude employees who, although they happened to work on or next to navigable waters, lacked a sufficient nexus to maritime navigation and commerce. In response to the experiences of many witnesses, Congress adopted what it called a “case-specific approach.”

We now quote the textual result: the pertinent provision— subsection three of section 902 of the Longshore Act—as it stands after the 1984 amendments. Our italics highlight key words.

“The term ‘employee’ means any person engaged in maritime employment, including any longshoreman or other person engaged in longshoring operations, . . . but such term does not include—

. . . 

 “(B) individuals employed by a club, camp, recreational operation, restaurant, museum, or retail outlet. . .  (Ranger, p. 4-5; original emphasis.)

The Second District therefore disregarded oft-cited Federal common-law precedent that did not adequately address the 1984 language quoted above even though such cases have not been expressly overruled by Federal courts.  These included Green v. Vermilion Corp. (5th Cir. 1998) 144 F. 3d 332, and Southern Pacific Co. v. Jensen (1917) 244 U.S. 205, the Ranger court noting the later featured a “celebrated” dissent by Justice Oliver Wendell Holmes.

Justice Wiley, writing for the Ranger court, succinctly summed up the court’s holding that, pursuant to California’s Labor Code sections 3351 and 3600, Ranger’s remedy was limited to a worker’s compensation claim:  

 . . . California’s workers’ compensation law is Ranger’s exclusive remedy. Congress in 1984 decreed this state law aptly covers his situation. A core part of the state workers’ compensation bargain is that injured workers get speedy and predictable relief irrespective of fault. In return, workers are barred from suing their employers in tort. The trial court correctly dismissed Ranger’s tort suit against his employer. (Ranger, p. 13.)

Tips for practitioners

Those prosecuting or defending tort claims should remember the concurrent jurisdiction of state courts in regard to a personal injury involving “navigable waters” which may fall under Federal Maritime Law.  They should likewise note that despite what their law school professors may have stressed as to the supremacy of Federal law, the modern — though by no means recent — trend is to recognize “concurrent” state court jurisdiction as to personal injuries even if the claim would otherwise fall under admiralty law.  

At the same time, Ranger reminds us that tort claims that otherwise fall under this “concurrent” jurisdiction and might otherwise be decided by a state court may be pre-empted by worker’s compensation exclusivity.  Counsel on both sides should therefore look to the Longshore Act, as amended in 1984, and their state law to determine if such a tort claim is instead within the exclusive purview of the worker’s compensation scheme in their state.

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1 — Article Three, Section Two of the United States Constitution states in part:

The judicial power shall extend to all cases, in law and equity, arising under this Constitution, the laws of the United States, and treaties made, or which shall be made, under their authority;--to all cases affecting ambassadors, other public ministers and consuls;--to all cases of admiralty and maritime jurisdiction;--to controversies to which the United States shall be a party;--to controversies between two or more states;—between a state and citizens of another state;--between citizens of different states;--between citizens of the same state claiming lands under grants of different states, and between a state, or the citizens thereof, and foreign states, citizens or subjects. (Emphasis added.)

By virtue of the Judiciary Act of 1989, Federal Courts have exclusive jurisdiction over admiralty and maritime Law claims but state courts retain their own jurisdiction over common law claims:

The district courts shall have original jurisdiction, exclusive of the courts of the States, of . . . [a]ny civil case of admiralty or maritime jurisdiction, saving to suitors in all cases all other remedies to which they are otherwise entitled. (28 U.S.C. section 1333(1); emphasis added.)

2 — While the terms “admiralty” and “maritime” are often used interchangeably, the Constitution expressly gives Federal courts jurisdiction over admiralty "and" maritime law. (See note one.)  "Maritime law" may be said to have global application and encompasses international waters, while "admiralty law" encompasses commercial maritime activities and therefore includes disputes involving coastal areas and inland waterways which may be defined as “navigable waters.”

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