Posts belonging to Category Law Firms & Lawyers

Niche Firm Rebuffed by Ninth Circuit for Attempt to Circumvent Trial Court

In rejecting the attempts of two defendants in three cases to get entries of summary judgment after having been denied by federal district courts, the Ninth Circuit has tasked the defendants’ law firm, Littler Mendelson PC, with convincing the appellate panel that the procedural gambits that it deemed to be “frivolous and wholly without merit” don’t warrant monetary sanctions against the firm and six of its lawyers. See In re: Con-way Freight, Inc., No. 13-71160 (9th Cir. June 27, 2013); see also In re: Nordstrom, Inc., No. 13-71162 (9th Cir. June 27, 2013) (“Nordstrom I”); In re: Nordstrom, Inc., No. 13-71163 (9th Cir. June 27, 2013) (“Nordstrom II”).

In the two putative class actions against Nordstrom, the plaintiffs alleged that the department store violated wage-and-hour law by imputing commission payments into periods of time in which commissioned employees were incapable of making sales or earning sales commissions. See Nordstrom I at 1; Nordstrom II at 1. Similarly, in the class action filed against transportation company Con-Way on behalf of “piece rate” workers, plaintiffs alleged that the defendant paid employees at a rate below the minimum wage. See Con-Way at 1.  The three cases share roughly the same procedural circumstances, which apparently caused the Littler firm to pitch an innovative strategy to the affected clients.

In substantially identical writs of mandamus on behalf of its clients, Littler asked the Ninth Circuit to intervene and reverse the district courts’ denial of summary judgment, which under the mandamus standard requires that a party have exhausted all relief in the district court and have no other means to avoid irreparable harm. While substantive issues of California law are frequently decided in federal court without extensive state-court authority interpreting California’s wage-and-hour statutes, mandamus should only be sought where new and important issue of law of first impression are implicated.

The Ninth Circuit’s curt and candidly negative response to Littler strongly suggested that the firm had overreached. (In each instance, Littler – not its clients – was ordered to show cause why sanctions shouldn’t be imposed against it pursuant to Ninth Circuit Rule 46-2 (d), which governs attorney misconduct and discipline.) Indeed, while the firm has filed a 50-page brief accompanied by exhibit appendices of nearly 1,000 pages purporting to respond to the Ninth Circuit, rather than establishing the extraordinary circumstances that would justify mandamus, Littler appears to have demonstrated little more than the usual uncertainty and dispute around any issue of statutory interpretation, and has fallen even shorter of establishing the requisite irreparable harm. See, e.g., Response to Order to Show Cause, Nordstrom II (July 19, 2013).

Seemingly adopting a more contrite position as to the greater public, and perhaps recognizing that the mandamus approach may be regarded as more foolish than innovative, the Littler firm has issued the following statement: “We have great respect for the United States Court of Appeals for the Ninth Circuit and are preparing a response to its order. We look forward to having this matter resolved conclusively in the near future.”

Reactions to Amex III

Last week’s U.S. Supreme Court decision in American Express Co. v. Italian Colors Restaurant, 570 U. S. ___ (2013) has occasioned diverse responses, ranging from the usual “nothing to see here” from more Pollyanic plaintiffs’ advocates, to the defense bar proclaiming that Amex III is apocalypse, again, for class actions, after having predicted roughly the same thing following the Supreme Court’s Dukes, Concepcion, and Comcast decisions.

The always thoughtful Paul Bland, of Trial Lawyers for Public Justice, has titled his piece on Amex IIIWorst Supreme Court Arbitration Decision Ever,” and focuses on the Amex III majority’s candid embrace of class arbitration waivers as de facto exculpatory clauses: “You see, until now, the Supreme Court has said that courts should only enforce arbitration clauses where a party could ‘effectively vindicate its statutory rights.’ Today, in a sleight of hand, the five conservative justices said that this means that arbitration clauses should be enforced even when they make it impossible for parties to actually vindicate their statutory rights, so long as they have a theoretical ‘right’ to pursue that remedy.” 

Kimberly Kraweloc’s respected and much-watched UCL Practitioner also accentuated the negative, noting that “the Court held 5-3 that the arbitration clause was enforceable even though an arbitration proceeding would provide no effective means to vindicate the plaintiffs’ statutory rights under the federal antitrust laws.”

However, recalling the extreme predictions that immediately followed earlier decisions concerning similar subject matter, Paul Karlsgrodt is more measured in his ultimate assessment, asking “Will Amex III finally be the case to end class actions as we know them?” and responding: “Concepcion hasn’t, so I doubt Amex III will either.”

Blogger Michael Fox described the most likely practical consequence of Amex III for employers as follows: “a large number of employers who have not implemented arbitration plans will be re-thinking the decision.” With the Supreme Court also having recently endorsed class-wide arbitration in Oxford Health Plans LLC v. Sutter, employers will likely seek to provide for a waiver of class actions along with mandatory arbitration clauses.

Finally, the ever-florid Cato Institute proclaimed that Amex III “is a victory for freedom of contract, a boost for arbitration as an alternative to litigation, and a step forward in the Court’s ongoing recognition that the class action is just one legal vehicle among many, not some priority express train to be favored over other traffic.”

One wonders, though, whether the Scalia-led arbitration crusade even views class actions as “just one legal vehicle,” or aims to consign class actions to something even less significant. And while prior legislative responses have stalled, efforts such as the Arbitration Fairness Act of 2013, which would among other things prohibit arbitration agreements and class action waivers as a condition of employment, are drafted and ready to be acted on should the Supreme Court overreach.

Both Sides Rebuffed in Netflix Closed Captioning Fee Dispute

Donald Cullen, a deaf college student, filed suit against Netflix over alleged violations of the Americans with Disabilities Act (ADA) and California’s Disabled Persons and Unruh Civil Rights Acts, claiming that Netflix failed to provide adequate closed captioning and made misleading statements about the availability of closed captioning in Netflix’s streaming movies and TV shows. While Cullen’s suit was pending, the National Association of the Deaf (NAD) filed and settled a similar action against Netflix, which resulted in a consent decree requiring that Netflix provide closed captioning in all streaming video by September of 2014. As a result, Cullen opted to dismiss his ADA claims.

Although Cullen’s suit did not directly generate the settlement resulting in the consent decree, it was likely among the constellation of forces — a “catalyst” under pertinent doctrine — that compelled Netflix to agree to precisely the relief that Cullen sought in his earlier-filed case. As such, Cullen’s attorneys sought fees of $250,000 based on that theory, noting that Cullen effectively prevailed in his litigation aims (insofar as his claims were virtually identical to those in the NAD lawsuit) and that in the course of litigating the case, Cullen and his counsel contributed to negotiations and decisions that ultimately led to the settlement with the NAD. However, Netflix’s counsel, San Francisco-based Morrison & Forster, not only opposed the attempt by Cullen’s counsel to recover fees, but argued that Netflix should be awarded $165,000 to pay Morrison & Forster for efforts spent defending against Cullen’s suit.

On May 1st, U.S. District Court Judge Edward J. Davila issued a decision denying both fee motions. Cullen v. Netflix, No. 11-1199 (N.D. Cal. May 1, 2013) (order denying plaintiff’s and defendant’s motions for attorneys’ fees, available here). Judge Davila held that Cullen had not successfully argued for application of the catalyst theory, finding that he failed to establish the requisite causal connection between his suit and the NAD-negotiated consent decree. Order at 4-5. In rejecting the Netflix fee motion, Judge Davila found that Netflix fell well short of establishing the criteria for a prevailing party entitled to fees, and hinted that the Cullen fee decision was a close call, since Cullen filed his claims “not only to rectify an alleged harm on his own behalf, but also to serve a greater purpose in the form of establishing certain civil rights standards and thresholds on behalf of a class of disabled individuals.” Order at 7.

Ultimately, that greater purpose will be served by the consent decree that will eventually provide for full closed captioning of Netflix streaming videos. Whether Cullen’s fee motion might have been granted in the absence of Netflix having filed its own fee motion cannot be known.

Law School, LLP: Law Schools Open Firms, Improve Job Placement Stats

The New York Times reports that law schools are starting law firms, ostensibly to provide real-world training to law students and provide legal aid to underserved populations, but with the additional benefits of providing a soft landing for graduates unable to get a job and boosting law-school employment statistics.

The Times article focuses on the non-profit firm, Alumni Law Group, established by Arizona State University, and includes a photo of two Arizona State students working on an unemployment benefits case (presumably for outside clients, not themselves). Arizona State and other schools that have launched similar programs cast these organizations in visionary terms, pointing to the school-affiliated firms as providing affordable legal services to those who might otherwise be unable to retain representation.

While the Times article reaches to portray the trend as one being adopted by more elite schools — comparing it to the business school certificate at the University of Pennsylvania and credit-for-work program at the University of Virginia — for now Arizona State is in the company of perennial US News & World Report rankings laggards Thomas Jefferson Law School in California and Pace Law School in New York. There is no word yet whether these newly-created firms will be ranked by Vault and other prominent sources of law firm rankings.