California Case Law - The FindLaw California Supreme Court and Courts of Appeal Opinion Summaries Blog

Recently in Bankruptcy Law Category

News of Pacific Gas and Electric declaring bankruptcy has left many of their California gas and electric customers wondering what's going to happen with their service, or the company they've grown to begrudgingly pay every month.

Notably, PG&E has stated that the bankruptcy will not lead to service interruptions for any customers. However, if layoffs or budget restrictions occur as part of the bankruptcy, there could be delays for service calls. Additionally, while liquidation isn't ordinarily part of a Chapter 11, according to local news reports, the company has explored selling off its natural gas division, or other assets.

Filing a Materialman's Lien? Don't Forget the 20-Day Notice

We’re going to take a page from Fight Club today.

The first rule of a materialman's lien is that you must serve a preliminary, 20-day notice to foreclose on the lien.

The second rule of a materialman’s lien — you guessed it — is that you must serve a preliminary, 20-day notice to foreclosure on the lien.

Decisions in Criminal, Tax, Copyright, and Cyberspace Law Matters

Sharp v. Superior Court, B222025, concerned a defendant's petition for a writ of mandate seeking to compel the superior court to vacate its order granting the People's motion for a mental examination by a prosecution-retained expert.

Das v. Bank of Am. N.A., B221002, concerned a challenge to the trial court's dismissal of the complaint in a daughter's suit for elder abuse against Bank of America, claiming that the bank failed to report financial abuse involving her father and engaged in other misconduct, including predatory lending.  In affirming the dismissal, the court held that as section 15610.30(b)'s 2008 amendments to the statutory scheme were substantive, rather than procedural, and the Legislature did not state that the amendments were retroactive in effect, they are inapplicable to plaintiff's claims.  The court also held that plaintiff's allegations regarding defendant's failure to comply with the statutory reporting duty state no claim against defendant, that the demurrers to plaintiff's remaining claims were properly sustained, and that there is no basis for finding the trial court abused its discretion when it sustained the demurrer without leave to amend.

Bank of Am. N.A. v. Stonehaven Manor, LLC, C060089, concerned a challenge to the trial court's order of attachment against the property of each of the guarantors for the alleged debt balance of about $90 million in a lender's suit against the two guarantors on the guaranty for the borrower's default.  In affirming, the court held that the property of a guarantor of a debt -- a debt which is secured by the real property of the principal debtor and also that of a joint and several co-guarantor -- is subject to  attachment where the guarantor has contractually waived the benefit of that security.

Los Angeles Unified Sch. Dis. v. Great Am. Ins. Co., S165113, concerned a challenge to the court of appeal's reversal of a trial court's judgment in favor of school district in a contract dispute between the school district and a contractor, arising from a contract to complete construction of an elementary school and to correct defects caused by an original contractor.  In affirming, the court held that a contractor on a public works contract may be entitled to relief for a public entity's nondisclosure of information that materially affected the cost of performance in the limited circumstances where: 1) the contractor submitted its bid or undertook to perform without material information that affected performance costs; 2) the public entity was in possession of the information and was aware the contractor had no knowledge of, nor any reason to obtain, such information; 3) any contract specifications or other information furnished by the public entity to the contractor misled the contractor or did not put it on notice to inquire; and 4) the public entity failed to provide the relevant information.

Clayworth v. Pfizer, Inc., S166435, concerned an antitrust suit brought by retail pharmacies under section 1 of the Cartwright Act and unfair competition law, claiming that manufacturers of pharmaceutical products had unlawfully conspired to fix the prices of their brand-name pharmaceuticals in the U.S. market at levels of 50 to 400 percent higher than for the same drugs sold outside the U.S.  In reversing the court of appeal's affirmance of trial court's grant of defendants' motion for summary judgment, the court held that for state antitrust purposes, the Hanover Shoe rule should apply even as indirect purchasers are allowed to sue, and as such, under the Cartwright Act, a no pass-on defense generally may not be asserted.  The court also held that plaintiffs have standing under the UCL and the right to seek injunctive relief under section 17203 is not dependent on the right to seek restitution.

Related Resources:

Jasmine Networks, Inc. v. Sup. Ct., No. H034441

In plaintiff's action under the California Uniform Trade Secrets Act claiming that the defendants misappropriated certain trade secrets belonging to plaintiff, trial court's dismissal of the complaint on the ground that plaintiff had forfeited its standing to maintain an action for misappropriation when it had gone through bankruptcy proceedings shortly after filing the complaint is reversed where: 1) a current ownership requirement is not supported by general principles of property or tort law; 2) existing authority imposes no "current ownership requirement" on trade secret plaintiffs; 3) adoption of a current ownership requirement in trade secrets cases is not warranted by analogy to trademark, patent, or copyright law; and 4) no policy concern preponderates in favor of current ownership requirement. 

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Appellate Information

Filed December 29, 2009


Opinion by Judge Rushing

For Appellant:   Trepel Law Firm, Anthony J. Trepel, McGrane Greenfield, William McGrane, Christopher Sullivan, Maureen Harrington, Greines, Martin, Stein & Richland, Robin Meadow, Marc J. Poster, Alana H. Rotter.

For Appellee:   Latham & Watkins, Steven M. Bauer, Charles Crompton, James K. Lynch, Cooke Kobrick & Wu, Steven S. Wu, Christopher C. Cooke, Jeffrey W. Kobrick

Imperial Merchant Services, Inc. v. Hunt, No. S163577

In a bankruptcy action decided on request of the United States Court of Appeals for the Ninth Circuit, the Supreme Court of California concludes that the statutory damages prescribed in Civil Code sec. 1719 are exclusive in the sense that a debt collector who recovers a service charge on a dishonored check pursuant to Civil Code sec. 1719 may not also recover prejudgment interest on damages under Civil Code sec. 3287. 

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Appellate Information
On Certification from the Ninth Circuit Court of Appeals.
Filed August 10, 2009

Opinion by  CHIN, J.

For Plaintiff: Law Offices of Clark Garen and Clark Garen.

For Defendant: Paul Arons; The Berg Law Group, Irving L. Berg; Horwitz, Horwitz & Associates and O. Randolph Bragg III.