Declarations and Exclusions

Marc Randazza: The Mark of Excellence

You will recall, perhaps, that I am a defendant in The Litigation Commonly Known as Rakofsky v. Internet. I have not posted updates on the case since last October, principally because the case was subject to a stay order. With the stay in place, there weren't much of nuthin' happening in the case. The stay expired on March 9 and, like maple sap in spring, the motion filings have started to flow again. The updates will start flowing again soon as well.

Today, as play resumes in Rakofsky, I want to take the opportunity to acknowledge the lawyer leading my defense, and the defense of more than thirty other defendants, most of them blawgers, in the Rakofsky litigation: Marc Randazza.

I had heard of Marc Randazza prior to being named as a Rakofsky defendant, but I had never had any contact with him. His presence and reputation were known to me through his blog, The Legal Satyricon, and through the blogging of others, such as Scott Greenfield or Ken-at-Popehat who know him firsthand.

Marc Randazza is a zealot, but a zealot of the best kind. His zealotry finds its focus in the First Amendment, and particularly the portions of that Amendment protecting freedom of speech and expression. Speech, without regard to its couth, its coarseness, its wisdom, its dunderheadedness, its cultural value, its tendency to discomfit or offend, is embraced by the First Amendment, and Marc Randazza has devoted his career to its preservation. Like Horatius at the bridge, Marc Randazza stands beside the Sluice of Speech to defend it and to see that its flow stays as wide and as free and as indiscriminate as possible.

What do we burn, apart from witches? More witches! What must we defend, apart from speech? More Speech!

Marc Randazza sees the Rakofsky suit, and far too many like it, as an attempt to pervert the power of law to the cause of stifling speech. He leapt, almost unbidden, to the defense of the Rakofsky blawgers in need of representation. With able assistance from Jay DeVoy of Randazza Legal Group and of our ace local counsel in New York, Eric Turkewitz, Marc Randazza is doing what is needful for me and for all of his other clients.

Marc Randazza has my back, and my back joins the rest of me in being grateful for it.

He is the man.

Thanks, man.

Let's Get Small

Mainstream legal reporting has its moments of accuracy, but also tends to be liberally larded through with misstatement, omission and dollops of authentic nonsense, especially when the report claims to have uncovered a burgeoning "trend." The Los Angeles Times succumbs to the hazards of the course today—on Page One, no less—as it ventures into the mysterious realms of the Small Claims Court and consumer class action law in a garbled story that seems to be about the former but that is really more concerned with the latter.

The Times pegs its report to a dispute between "angry consumer" Heather Peters and Honda Motor Company:

The Los Angeles resident is miffed that her 2006 Honda Civic hybrid doesn't get its claimed fuel economy. And she isn't satisfied with a proposed class-action lawsuit settlement that would give trial lawyers $8.5 million while Civic owners would get as little as $100 and rebate coupons for the purchase of a new vehicle.

But Peters believes that she found a venue where she can win justice and where Honda can't spend a single dollar on legal help.

On Jan. 3 she'll take her case to Small Claims Court in Torrance, where California law prohibits Honda from bringing an attorney. She's asking for the maximum of $10,000 to compensate her for spending much more on gasoline than expected. Honda said the Civic would get about 50 miles per gallon, but because of technical problems the car gets closer to 30 mpg.

By way of background: in California, the Small Claims Court exists as a division within the larger Superior Court. (Other jurisdictions, of course, have equivalent institutions, but California is the focus of the Times story, and of this blog.) The purpose of Small Claims Court is to take disputes involving relatively small amounts of money out of the more formal judicial system, in the hope that the claims can be resolved more quickly and at less expense than in a full-scale court case. A Small Claims case can often be concluded within weeks of filing, rather than the months or years entailed in a "real" lawsuit. Hearings are somewhat informal, and rules of evidence such as the hearsay rule are more loosely applied.  Typically, Small Claims cases are not heard by an actual judge. The hearing officer will most likely be a local volunteer attorney sitting as a temporary judge on the Court’s behalf.  The hearing officer is expected to apply the law as any other court would, but the relative informality of the Small Claims process inevitably leaves open the potential for some to go Solomonic and to do "what seems fair" regardless of legal niceties.

So then, to return to the Times report:

One point that the story alludes to but never states plainly—"burying the lede" as the journobloggers like to say—is that the jurisdictional limit on California Small Claims cases will be increasing as of January 1, 2012. Ms. Peters will be permitted to claim as much as $10,000 only because her hearing is scheduled for the first court day of the new year. If the case were heard today, the maximum award would be only $7,500.

• The increased jurisdictional limit has some oddities of its own. First, the $10,000 maximum only applies to claims asserted by actual human plaintiffs. Corporate plaintiffs are now, and will remain, able to seek relief in Small Claims Court only up to $5,000. For reasons that are not at all plain, the existing $7,500 limitation will remain in place even after January 1 for claims of "bodily injuries resulting from an automobile accident," in cases in which the allegedly negligent defendant "is covered by an automobile insurance policy that includes a duty to defend."

The claim by the Times that "Honda can't spend a single dollar on legal help" is bunk. The only thing Honda cannot do is send a lawyer to appear at the Small Claims hearing itself. Up to the courthouse door, Honda can (and presumably will) spend whatever it wants to obtain advice and assistance from its attorneys in preparing to put on a defense. Honda can be represented at the hearing by any employee it designates, so long as that employee is a non-lawyer whose primary job is something other than appearing for the company in Small Claims court. Whoever that employee may be, it is near to inconceivable that he or she will not have been fully briefed and prepared, armed with all necessary evidence, and likely supplied with a written legal brief, drafted behind the scenes by counsel, for the "guidance and assistance" of the hearing officer. To the extent that insurance coverage applies, Honda's liability insurer may well be paying for the necessary legal consultation.

Also not mentioned by the Times: if Ms. Peters claim results in a judgment against Honda, Honda has the option of appealing that judgment. In California practice Small Claims defendants have a right of appeal, but Small Claims plaintiffs do not. A small claims appeal goes before an actual Superior Court judge and is heard de novo: that is, it is an entirely new hearing, as if the original Small Claims proceeding had not happened.  More pertinent to the unreliable theme of the Times story: in Small Claims appeals, the parties are entitled to be represented by an attorney at the hearing, as Honda surely would be. 

Having glossed over the extent to which attorneys can and will involve themselves in Small Claims litigation, the Times sets its controls for the heart of hyperbole and and runs straight on into trend-spotting cliché:

If she's successful in getting others to follow her example, Peters could inspire a whole new litigation strategy in the auto industry and other businesses. Working together but filing lawsuits independently, consumers could force companies to go mano a mano with individual plaintiffs in far-flung courtrooms nationwide.

Call it a small-claims flash mob.

"This could create a lot of problems in the industry," said Aaron Jacoby, the Los Angeles defense attorney who heads the automotive industry group at the Arent Fox law firm.

Dewy-eyed invocations of "social networking and the Internet" follow, leading to the inevitable "to be sure" caveat and the equally inevitable exception to the caveat. Small Claimants have to "prepare arguments" and take time from work to show up in court, don't you know? It can be "daunting," adds attorney Jacoby, who almost certainly had more potent things to say than the 16 words the Times elected to quote. But...

there also could be some benefits, beginning with 'cutting the attorneys out of the equation in these cases,' said Richard Cupp Jr., who teaches product liability law at Pepperdine University.

Why might "cutting the attorneys out" be an unalloyed Good? In a further exercise in lede-burying the Times pivots its attention from defense counsel to plaintiffs' attorneys and strikes up what appears to have been the intended true theme of the story: the well known, often painful disconnect between the remedies that are obtained for individual class action plaintiffs—in the Honda cases, $100 to $200 cash and a potential discount of between $500 and $1000 on future Honda purchases—and the rather larger remedies obtained by the much smaller class of lawyers representing them—here, reportedly a share of $8.5 million in fees. One such lawyer is quoted expressing his pride in what he and his compatriots have wrought in crafting the settlement; his personal stake in the payout goes unquantified.

In the concluding segment of the story, we return to Peters and learn that this angry consumer may not be nearly so angry with Honda and its lawyers as she is with class counsel:

If successful, Peters, a state employee, could win damages many times the payment she would derive from the settlement. It helps that she's a former attorney herself (she let her license expire a decade ago), and thus has an easier time navigating the legal system than a typical consumer.

Although Peters hopes that others might also pursue their claims in Small Claims Court, she said if she wins a significant award, the figure could be used to scuttle the proposed class-action settlement in favor of one that would exact more money from the automaker.

'I am just trying to give people a tool kit that shows they have options besides capitulating for $100 or going out and hiring an expensive attorney,' Peters said.

Savvy State-employed recovering lawyer that she is, Heather Peters' decision to proceed in Small Claims Court suggests a calculated assessment on her part that whatever actual damages she or other individual Honda buyers may have sustained amount to something more than a few hundred dollars, but something less than $10,000 apiece. If that is the case, then she is likely right to think that proceeding by a class action offers no real advantage to her in terms of time and resources invested or the size her ultimate recovery. Going that route will not, however, eliminate Honda's attorneys entirely from the mix, much as the Times might wish it.

~~~

Update [1300 PST]: Portland, Oregon-based class action attorney David Sugerman adds a few insights on his blog, including links to Heather Peters' website opposing the class settlement and to her Twitter feed. Interestingly, at this writing, Ms. Peters herself has not linked to the Los Angeles Times story.

Here's a question I am at least somewhat curious about: Who is responsible for this story coming to the Times' attention in the first place, and for building this into a front page story in a fading-but-still-relatively-major metropolitan newspaper? Is Ms. Peters handling her own PR?

~~~

Photo: Tiny World Courthouse, Chambersburg, PA, via Ed South's Wonderful World of Blog. Post title lifted from Steve Martin, ca. 1977.

"You Can't Fool Me: There Ain't No Sanity Clause"

At this season of kindness, calmness, sweetness and good cheer, let us wish for a world in which every  legal negotiation could be as simple as this one:

Marx Brothers - Sanity Clause

Chico is mistaken, of course, although the gentleman in question prefers to go by the name Saint NicholEsq.

Decs&Excs wishes a Happy Christmas to lawyers everywhere, and wishes it tenfold for those who tolerate or even love us.  Ladies and gentlemen of the Bar, let us strive always give them good cause to do so.

~~~

"Santa, Esq." illustration via Harrisburg, PA, violinist/broadcaster John Clare's Classically Hip. 

[Do click through to see what a mess the Legal Department has made in retitling Christmas carols.  "Vertically Challenged Adolescent Percussionist"?  Humbug!]

Put the Picture in the Box: Advice on Instructing Juries in Insurance Litigation

On his Insurance Scrawl weblog, Marc Mayerson offers up a lengthy, detailed and, yes, instructive post on "Jury Instructions in Insurance-Coverage and Insurance Bad-Faith Cases."  Marc provides plenty of practical advice for practitioners on either side of an insurance law dispute, and valuable reading for claims professionals or claimants who want to understand just What Their Lawyers Are Up To in trial preparation. 

Jury instructions can be compared to the wire armature underneath a clay sculpture: whichever side of the case he or she is on, counsel wants to be able to point to that armature and impress the jury with how well his or her side has fleshed it out with evidence.  ("My case hangs on those bones much more persuasively than my opponent's, ladies and gentlemen.")  The practical value of this bit of advice, in particular, cannot be overstated:

One mistake that lead counsel often makes in my view is not to personally take ownership of the jury instructions and instead delegates their preparation to the junior member of the team.  Ultimately, it is the jury instructions that determine the case – and the appeal.  Thus, it should be the responsibility of lead trial counsel to be intimately familiar with the drafting, submission, and argument over instructions to the jurors.

A highly recommended post.

I, The Jury

Judge:    How does the jury find?
Foreman:  We find the defendants incredibly guilty.
        -- The Producers (1968)

Today, I will be putting in an appearance at the Clara Shortridge Foltz Criminal Justice Center -- Los Angeles County's central criminal courthouse, renamed in recent years in honor of California's, and America's, First Practicing Female Lawyer -- to answer the call of jury service.  The odds of my actually being impaneled as a juror are slim, given my status as a practicing attorney.  Usually the question isn't whether I will be peremptorily challenged, but which side will do it first.

In the unlikely event of my actually serving as a juror, I resolve not to emulate these jurors or these.  Unless, of course, such a result is warranted by the operative facts and law.

~~~

Update [11/1/05 1733 PST]:  Don't let anyone tell you that they never keep a lawyer on a jury panel.... Beyond that, I can say no more at this time.

Veterinarians: Dogged by Lawyers

Ted Frank at Overlawyered points to a USA Today article recapping the state of play in malpractice suits against veterinarians.  Using the death of a dog (the ironically named  "Lucky") following a dental procedure as its starting point, the article describes what it claims is a growing trend toward expansive veterinary liability:

Barry Silver, the attorney for Lucky's owners, says that when the case goes to trial this year in Broward County, Fla., he intends to ask jurors to award hundreds of thousands of dollars to the dog's owners, Adam Riff and his mother, Ellen.

If Silver is successful, Lucky's case would join a series of recent court decisions that essentially have treated animals as human under the law. In a reflection of the special place that pets have come to hold in Americans' hearts, U.S. courts are bucking centuries of legal decisions that have defined animals as property.

In recent years, courts in New York, Maryland and Texas have resolved custody disputes involving pets by deciding what's best for the pet. Judges in 25 states have administered financial trusts set up in pets' names.

And as Lucky's case indicates, there has been another turn in animal law: Courts have begun to take claims of veterinary malpractice seriously.

As usual in these stories, there are several references to the case of Marc Bluestone, whose $39,000 judgment in Orange County last year is generally described as the largest veterinary malpractice award to date.   Decs & Excs commented on the Bluestone case, in which our firm played a minor part prior to trial, in a December 6, 2004, item, here. 

The Bluestone verdict has been appealed by the defendant veterinarians, with a cross-appeal by Mr. Bluestone (who apparently contends that he is entitled to an even larger award).  The matter is before Division 3 of the Fourth District Court of Appeal, which has one of the more congested appellate dockets in the state: written briefing is just now getting started, and it is probable that it will be at least another year before the appeal is actually argued and ruled upon.  Interested readers can follow the progress of the case via the Court's on-line docket.

Of related interest: A wide-ranging trove of resources on the law and its relation to animals can be accessed through the Animal Legal & Historical Center, a service of the College of Law of Michigan State University.

What a Relief!

The story (not available online to non-subscribers) actually turns out to be about the California Supreme Court's reversal of convictions that were based on a prosecutor's having argued inconsistent theories to two different juries in trials arising from the same crime, but insurers and claims professionals will surely take heart from this headline on the front page of today's edition of the Los Angeles Daily Journal:

Justices Toss Death Sentences for Bad Faith

Now if we can just get rid of those pesky punitive damages . . . .

Other Voices, Other Rooms - Week 2

• The Southern California Law Blog reports that a U.S. District Court Judge in Fresno was so put out by what he perceived to be misstatements, frivolous objections, and willful delay of proceedings that he has ordered an entire law firm to receive ethics training. 

• I am reminded of something my bar review instructor said when I was preparing to take the Professional Responsibility Exam:  "This test can determine whether you know the difference between right and wrong.  Whether you will actually do the right thing is another matter . . . ."

• Shapes of Risks to Come?: L.A. Observed points to a story in the Los Angeles Times reporting that under new owner Frank McCourt the Los Angeles Dodgers "have halted seismic improvements to Dodger Stadium that began under News Corp. ownership, saying the project was unnecessary and the 43-year-old ballpark is safe."

• It is too much to hope that Los Angeles will remain free of major earthquakes, but the Dodgers' insurers and lawyers should certainly hope that the next one doesn't happen during a crowded ballgame, in light of management's calculated (and publicly acknowledged) decision to forego additional seismic precautions.  The Ford Pinto was "safe" without moving that gas tank, too, right?

• In Other News:  From the "If What Thine Eye Sees Offends Thee" Dept., take a look at this:

Man Blinded Four Times in Same Eye Sees Way to Plead Guilty to Insurance Fraud

. . . But They Can't Hide

An intriguing bit of phrasing in this Insurance Journal headline:

Farmers Survey: Red Light Running Among Top Causes of Crashes;
Men More than Women Feel Need to Run.

No word yet on whether the study puts the blame on Bruce Springsteen.

Landslides and Litigators

Within the comparatively small area that it has affected, the landslide north of Los Angeles at La Conchita  -- with at least ten dead, several others still missing and more left homeless -- is nearly as devastating as the Asian tsunami.   It is something of a cliché to suggest that "Where There's a Tragedy, There's a Lawsuit," but La Conchita may yet provide a fresh example.

Although no one died, the town of La Conchita sustained significant property damage in 1995 when the same hillside collapsed.  That slide did produce litigation, directed against the avocado grower at the top of the hill.  As the Sacramento Bee reports:

La Conchita residents tried to blame irrigation at the La Conchita Ranch Co. atop the hill for the 1995 slide. One group of residents settled a lawsuit before trial, and another case ended with the judge ruling irrigation hadn't caused the slide. The ranch has continued to irrigate the crops at the top of the hill.

The Los Angeles Daily Journal, our local legal newspaper, had a more extensive report yesterday on the prior litigation and the prospects for more.  [No link; the DJ does not make its stories available online to non-subscribers.]  Representative excerpts from that story:

Robert Brace, a partner at Santa Barbara's Hollister & Brace, who lost a friend in Monday's tragic slide, represented more than a 100 residents in a negligence suit against La Conchita Ranch Co. after a 600,000-ton slab of earth slid into the town in March 1995, leveling nine homes but sparing lives.

Brace argued the overirrigation of citrus and avocado crops atop the bluff contributed to instability within the hill, while the heavy rains brought on by El Nino that year were simply 'the straw that broke the camel's back.'

* * *

Ranch lawyer Frank Sabaitis of Los Angeles' Sabaitis O'Callaghan said Brace's claim that overirrigation had reactivated ancient landslides didn't hold water, and Ventura Superior Court Judge Henry Walsh ruled the ranch could not be held liable for future slides based on that premise.

* * *

Brace said he wasn't yet sure if liability suits, which could easily top eight figures due to the fatalities and community destruction, would be filed against the county.  But while he conceded that residents deserved at least some blame for sticking around after the first slide, Brace said the activities atop the hill should not be forgotten.

'That town should never have been there in the first place. It's a dangerous spot to be,' he said.  'But once you have those facts, you don't want to water the landslide [area].  If there was any question that irrigation may cause a landslide, then you shouldn't irrigate.

'It was crazy for the people to continue to live there, but crazier for the ranch to keep irrigating that hill.'

The potential target for new litigation is the County of Ventura, which installed motion sensors and a retaining wall -- as well as warning signs throughout the community -- after the 1995 slide.  The sensors reportedly did not sound an alert in advance of Monday's collapse, and the retaining wall came down with the rest of the slope. 

In the DJ story, an unnamed county official is quoted asking rhetorically: "[W]hen you get a year's worth of rain in a week, how do you defend against that?"  To which one can only counter: What are the odds that at least one expert witness out there is preparing even now to provide an answer to that question in court?