Case Summaries

Commercial Law

[03/04] New York v. Golden Feather Smoke Shop, Inc.
In defendants' appeal from a preliminary injunction prohibiting the sale of untaxed cigarettes other than to members of the Unkechauge Nation for their personal use, the Second Circuit certifies the following questions to the New York Court of Appeals: 1) Does N.Y. Tax Law section 471-e, either by itself or in combination with the provisions of section 471, impose a tax on cigarettes sold on Native American reservations when some or all of those cigarettes may be sold to persons other than members of the reservation's nation or tribe?; 2) If the answer to Question 1 is "no," does N.Y. Tax Law section 471 alone impose a tax on cigarettes sold on Native American reservations when some or all of those cigarettes may be sold to persons other than members of the reservation's nation or tribe?

[03/02] Mac's Shell Serv., Inc. v. Shell Oil Prods. Co.
In an action under the Petroleum Marketing Practices Act (Act) by service station franchisees, alleging that a petroleum franchisor, Shell, and its assignee had constructively terminated their franchises and constructively failed to renew their franchise relationships by substantially changing the rental terms that the dealers had enjoyed for years, increasing costs for many of them, a circuit court's order partially affirming judgment for plaintiffs is affirmed in part where a franchisee who signs and operates under a renewal agreement with a franchisor may not maintain a constructive nonrenewal claim under the Act. However, the court of appeals' order is reversed in part where a franchisee cannot recover for constructive termination under the Act if the franchisor's allegedly wrongful conduct did not compel the franchisee to abandon its franchise.

[03/02] Pfizer v. Sup. Ct.
In plaintiffs' action against Pfizer, the manufacturer of Listerine mouthwash, pursuant to the Unfair Competition Law (UCL) and False Advertising Law claiming that Pfizer marketed the mouthwash in a misleading manner by representing that the use of it can replace the use of dental floss in reducing plaque and gingivitis, defendant's petition for writ of mandate seeking to overturn an order certifying the class action is granted as the ruling certifying a class consisting of all persons who purchased Listerine in California during a six-month period is overbroad, and In re Tobacco II Cases, 46 Cal.4th 298 (2009), does not require a different disposition in this case.

[03/02] Ad Hoc Shrimp Trade Action Comm. v. US
In plaintiff's action with the Court of International Trade challenging a determination that the multinational corporation provision, 19 U.S.C. section 1677b(d) (MNC Provision) did not apply to a company with affiliates in China and Vietnam, the court's decision is affirmed as the Department of Commerce acted in accordance with law in concluding that the MNC provision is not applicable when the non-exporting country is a nonmarket economy and normal value is based on a factors-of-production methodology.

[03/02] Ma v. Merrill Lynch, Pierce, Fenner & Smith, Inc.
In an action against Merrill Lynch based on unauthorized transfers from plaintiff's investment account, summary judgment for defendant is affirmed where New York U.C.C. Section 4-A-505, which imposes a one-year statute of repose on certain claims based on electronic funds transfers, bars plaintiffs' common law claims, which had longer limitations periods.

[03/01] Powershare, Inc. v. Syntel, Inc.
In parties' action for breach of a business agreement, a district court's denial of defendant's motion to stay litigation pending arbitration is reversed where: 1) the agreement contains a mandatory arbitration provision; and 2) the standard of review to be employed by a district judge when reviewing a magistrate judge's order on a motion to stay litigation pending the resolution of a parallel arbitration proceeding is under the "clearly erroneous or contrary to law" standard elucidated in Rule 72(a).

[02/26] Resolute Natural Resources Co. v. FERC
In a petition for review of certain orders of the Federal Energy Regulatory Commission (FERC) declining to investigate allegedly anticompetitive conduct by a refining company involving oil pipelines in New Mexico, the petition is dismissed where FERC decisions not to investigate were not subject to review.

[02/24] McAdams v. Monier, Inc.
In plaintiffs' action under the Consumer Legal Remedies Act and the Unfair Competition Law, claiming that defendant failed to disclose that the color composition of its roof tiles would erode away well before the end of the tiles' represented 50-year lifetime, trial court's order denying certification of the proposed CLRA and UCL classes are reversed where: 1) as to the elements of liability and reliance, plaintiffs' CLR cause of action, based on the alleged failure to disclose is suitable for class treatment; and 2) trial court used improper criteria and made erroneous legal assumptions in denying certification of the proposed UCL class, and on remand, court is instructed to determine if the representative plaintiff meets the UCL standing requirements set forth in Tobacco II.

[02/24] Drum v. San Fernando Valley Bar Ass'n
In plaintiff's action against a bar association, trial court's grant of defendant's dismissal is affirmed as a voluntary bar association did not engage in an unfair business practice when, allegedly, it unilaterally refused to sell its membership mailing list to a person who intended to offer low-priced mediation services in competition with higher-priced mediation offered by some of the association's members.

[02/23] Cumbie v. Woody Woo, Inc.
In a Fair Labor Standards Act (FLSA) action claiming unpaid wages, the dismissal of the complaint is affirmed where a restaurant did not violate the FLSA when, despite paying a cash wage greater than the minimum wage, it required its wait staff to participate in a "tip pool" that redistributed some of their tips to the kitchen staff.

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Dispute Resolution & Arbitration

[03/04] Pac. Bell Tel. Co. v. Cal. Pub. Utils. Comm.
In a telecommunications company's appeal from (1) the district court's confirmation of an arbitral order affirming the California Public Utilities Commission's (CPUC) requirement that plaintiff lease entrance facilities to competitor local exchange carriers (LECs) at Total Element Long Run Incremental Cost (TELRIC) rates for the purpose of interconnection; and (2) the district court's order vacating the arbitrator's affirmance of CPUC's conclusion that 47 C.F.R. section 51.319(e)(2)(ii)(B) applied only on routes where competitive LECs were not "impaired" as to DS3 transport circuits, the orders are affirmed where: 1) FCC regulations authorized state public utilities commissions to order incumbent LECs to lease entrance facilities to competitive LECs at regulated rates for the purpose of interconnection; and 2) the plain language of the governing regulation, 47 C.F.R. section 51.319(e (2)(ii)(B), limited a competitive LEC to a maximum of ten DS1 circuits along any route regardless of whether the competitive LEC was impaired as to DS3 lines.

[03/01] Powershare, Inc. v. Syntel, Inc.
In parties' action for breach of a business agreement, a district court's denial of defendant's motion to stay litigation pending arbitration is reversed where: 1) the agreement contains a mandatory arbitration provision; and 2) the standard of review to be employed by a district judge when reviewing a magistrate judge's order on a motion to stay litigation pending the resolution of a parallel arbitration proceeding is under the "clearly erroneous or contrary to law" standard elucidated in Rule 72(a).

[02/26] Gravillis v. Coldwell Banker Residential Brokerage Co.
In plaintiff's action against his brokers for failing to disclose the structural damage of his home, trial court's decision affirming the arbitrator's award of damages in favor of the plaintiff is affirmed as the arbitration agreement does not explicitly and unambiguously provide for an expanded scope of review.

[02/24] Drum v. San Fernando Valley Bar Ass'n
In plaintiff's action against a bar association, trial court's grant of defendant's dismissal is affirmed as a voluntary bar association did not engage in an unfair business practice when, allegedly, it unilaterally refused to sell its membership mailing list to a person who intended to offer low-priced mediation services in competition with higher-priced mediation offered by some of the association's members.

[02/22] Oaktree Capital Mgmt., LP. v. Bernard
Trial court's judgment confirming an arbitration award against defendant-investor for breach of fiduciary duty, arising from his failure to disclose an investment opportunity to his real estate investment hedge fund is affirmed as the arbitration agreement here barred judicial review, as it stated that the arbitrator's award will be "binding" and that "all decisions of the arbitrator...shall not be subject to appeal."

[02/22] Raymond James Fin. Servs. Inc. v. Bishop
A decision vacating an arbitration panel's award of compensatory damages in favor of three financial advisors arising from their claims of wrongful discharge, pursuant to the rules of the National Association of Securities Dealers (NASD), is affirmed where: 1) the district court did not abuse its discretion in remanding the award to the arbitration panel for clarification of the bases of the award; 2) the arbitration panel committed no mere error of law, rather, by rendering an award whose underlying legal basis exceeded the bounds of arbitrable employment-related disputes cognizable under NASD Rule 10101 as interpreted in Zandford v. Prudential-Bache Secs., Inc., 112 F.3d 723 (4th Cir. 1997), the panel exceeded its powers under 9 U.S.C. section 10(a)(4).

[02/18] In the Matter of N.Y. City Transit Auth.
In a CPLR article 75 proceeding to vacate a labor arbitration award which modified a New York Transit Authority employee's penalty (for allegedly assaulting a member of the public) from termination to reinstatement without back pay, confirmation of the award is affirmed where the arbitrator did not exceed his power under the collective bargaining agreement by modifying the disciplinary sanction imposed on an employee by a transit authority.

[02/18] Suh v. Sup. Ct.
Plaintiff-anesthesiologists' petition for a writ of mandate, arising from two anesthesiology contracts with a hospital, is granted where: 1) plaintiffs did not agree to arbitrate disputes relating to one of the contracts; and 2) the terms of the arbitration clause in the other contract are, because of the applicable rules limiting damage remedies, unconscionable, rendering the agreement to arbitrate unenforceable.

[02/17] Ragone v. Atlantic Video
In a sexual harassment action, dismissal of the complaint and a grant of defendant's motion to compel arbitration are affirmed where: 1) the fact that plaintiff was offered the arbitration agreement on a "take it or leave it" basis did not render it unenforceable; and 2) defendant agreed to waive any potentially unconscionable terms of the agreement.

[02/16] Rite Aid of Pennsylvania, Inc. v. United Food & Commercial Workers Union Local 1776
In an action by a union against a drugstore chain (Rite Aid), claiming that Rite Aid denied entry when union representatives attempted to enter six of the newly acquired stores, district court's judgment that the union's grievances were not arbitrable is affirmed where: 1) the district court correctly concluded that the recognition clause is not susceptible of an interpretation which would yield such a right; 2) the union's store-access grievance does not require interpretation of section 5.1, the observation clause, and arbitration is not properly invoked by reliance on this provision; 3) the union's store access grievance does not fall within the scope of the CBA's arbitration clause because it does not require the interpretation of any of the CBA's provisions; and 4) the union's argument that the district court impermissibly considered the merits of its grievance in making its arbitrability determination is rejected as decisions of the Supreme Court and Courts of Appeals have made clear that where the merits and arbitrability questions are inextricably intertwined, a court's arbitrability decision may, of necessity, touch incidentally on the merits.

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Property Law & Real Estate

[03/09] Martinez v. Wells Fargo Home Mortgage, Inc.
In an action under Section 8(b) of the Real Estate Settlement Procedures Act (RESPA), and California's Unfair Competition Law (UCL), claiming that a mortgage lender charged plaintiffs an illegal underwriting fee, dismissal of the complaint is affirmed where: 1) the clear and unambiguous language of RESPA Section 8(b) did not reach the practice of "overcharging"; and 2) the UCL claims alleging "unfair" and "fraudulent" conduct were preempted by the National Bank Act, and the allegations of "illegal" conduct failed to state a claim.

[03/09] Hoopa Valley Tribe v. US
In an action against the United States for breach of fiduciary duty brought by the Hoopa Valley Tribe, arising from the distribution of the remainder in a Settlement Fund established under the Hoopa-Yurok Settlement Act only to the Yurok Tribe, summary judgment in favor of the government is vacated and remanded where: 1) the Hoopa Valley Tribe lacks standing because it cannot show an injury in fact; but 2) the matter should have been dismissed without prejudice

[03/03] Galbiso v. Orosi Pub. Util. Dist.
In plaintiff's action against a public utility district seeking a preliminary injunction to prevent the utility district from conducting a "tax sale" of plaintiff's parcels for the collection of sewer assessments and a petition for a writ of mandate to correct the utility district's alleged abuse of discretion, judgment sustaining defendant's demurrer is affirmed where: 1) the trial court correctly sustained a general demurrer to complaint for injunctive relief on all causes of action; 2) trial court correctly sustained the general demurrer to the writ of mandate petition; and 3) the trial court did not abuse its discretion in denying leave to amend.

[03/03] Fed. Ins. Co. v. Commerce Ins. Co.
In plaintiff-insurance company's subrogation claim, district court's grant of summary judgment in favor of defendants in concluding that the implied coinsured doctrine controlled the outcome in this case and precluded the plaintiff from pursuing a subrogation claim is affirmed as plaintiff has not met its burden of proving that the "Responsibility for Damages" provision of a Residence and Care Agreement (RCA) overcomes the presumption that the landlord's insurance is held for the mutual benefit of both parties.

[03/01] Jimenez v. Rodriguez-Pagan
In plaintiffs' action for the share of her deceased husband's interest in an apartment complex development, district court's dismissal is vacated and remanded as the narrow conditions for Colorado River abstention are met here, and thus, the parallel action in federal court is ordered to stay pending the outcome of the Commonwealth court case.

[03/01] Res. Conservation Group, LLC v. US
In plaintiff's action against the United States under the Administrative Dispute Resolution Act, for refusing to consider its bid for the lease of the Naval Academy's dairy farm, decision of the US Court of Federal Claims dismissing the action for lack of subject matter jurisdiction is affirmed in part, reversed in part and remanded where: 1) the Court of Federal Claims correctly held that plaintiff's claim does not fall within the jurisdiction conferred by 28 U.S.C. section 1491(b)(1) as relief is unavailable outside the procurement context; and 2) implied-in-fact contract jurisdiction under section 1491(a)(1) that existed prior to 1996 survived the enactment of the ADRA as to claims where the new statute does not provide a remedy.

[02/26] Gravillis v. Coldwell Banker Residential Brokerage Co.
In plaintiff's action against his brokers for failing to disclose the structural damage of his home, trial court's decision affirming the arbitrator's award of damages in favor of the plaintiff is affirmed as the arbitration agreement does not explicitly and unambiguously provide for an expanded scope of review.

[02/26] Clear Lake Riviera Cmty. Ass'n. v. Cramer
In an action against defendants to abate their violation of an approved height for their home, trial court's judgment is affirmed where: 1) the association's height guideline was validly adopted; 2) mere participation of a non-appointed person in the business of the committee, under these circumstances, would not invalidate the committee's official actions; and 3) trial court did not abuse its discretion in ordering defendants to tear down their house in order to comply with the guidelines rather than award money damages.

[02/26] Rumber v. Dist. of Colum.
In an action to prevent the District of Columbia from acquiring a shopping center by eminent domain, dismissal of the complaint is affirmed where the district court properly abstained from hearing the case because only four of the plaintiffs owned or leased properties in the shopping center, and those four were already litigating the matter in the District of Columbia's court system.

[02/25] Thompson v. Lynch
In an action to partition a parcel of land, the chancery court's partition order is affirmed where: 1) the chancery court correctly held that appellants were judicially estopped from contradicting their previous position that the court had jurisdiction to hear the matter; and 2) the record supported the special master's factual findings.

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Landlord Tenant

[03/03] Fed. Ins. Co. v. Commerce Ins. Co.
In plaintiff-insurance company's subrogation claim, district court's grant of summary judgment in favor of defendants in concluding that the implied coinsured doctrine controlled the outcome in this case and precluded the plaintiff from pursuing a subrogation claim is affirmed as plaintiff has not met its burden of proving that the "Responsibility for Damages" provision of a Residence and Care Agreement (RCA) overcomes the presumption that the landlord's insurance is held for the mutual benefit of both parties.

[02/09] Chacon v. Litke
In a wrongful eviction action, judgment in favor of plaintiffs-tenants concluding that defendants violated the San Francisco Rent Stabilization and Arbitration Ordinance is affirmed where: 1) defendants' interpretation of the Ordinance as conditioning a tenant's right to reoccupy the unit upon compliance with a 60-day notice is rejected; 2) substantial evidence supports the trial court's finding that the stipulation gave defendants temporary possession of the apartment for up to three months to make repairs and the plaintiffs retained their rights under the Ordinance to reoccupy the premises; 3) the litigation privilege did not apply to defendant's conduct in refusing to allow the plaintiffs to reoccupy the apartment; 4) trial court did not err in granting judgment on the pleadings on the affirmative defenses; and 5) trial court did not abuse its discretion in awarding plaintiffs' attorney's fees.

[02/01] Woodlands Park Mgmt., LLC. v. City of E. Palo Alto Rent Stabilization Bd.
Trial court's holding that the Rent Stabilization and Eviction for Good Cause Ordinance (RSO), adopted by the citizens of the City of East Palo Alto, permitted recovery of attorney fees by a landlord in successful litigation against the city is reversed as the intent of the electorate was that section 15.A.5 of the RSO authorize the recovery of attorney fees only in civil proceedings between landlords and tenants to enforce their respective rights under the RSO, and no other provision of the RSO provides for an award of fees against the city.

[12/02] Tarrant Bell Prop., LLC v. Sup. Ct.
In a case brought by residents of a mobile home park against the park owners for failing to properly maintain common areas and facilities and for being subjected to substandard living conditions, denial of defendant's motion to compel judicial reference is affirmed as a trial court has the discretion to refuse to enforce a reference agreement under the circumstances in the case or related considerations of judicial economy, and the court did not abuse that discretion.

[11/13] Bloch v. Frischholz
In plaintiffs' Fair Housing Act (FHA) suit against their condo association for being required to remove a mezuzah from their doorpost under a new rule requiring that common hallways and outside of the doors be kept free of any objects, summary judgment in favor the condo association and its president is reversed for the most part where: 1) the judgment of the district court with respect to plaintiffs' claims under sections 3604(b), 3617 and 1982 is reversed as a trier of fact could conclude that the condo association's reinterpretation of the hallway rule and clearing of all objects from doorposts was intended to target only groups of residents for which the prohibited practice was religiously required; 2) plaintiffs can therefore proceed on an intentional discrimination theory under sections 3604(b), 3617 and 1982; and 3) district court's judgment granting summary judgment against the plaintiffs on their section 3604(a) claim is affirmed.

[10/28] 311 S. Spring St. Co. v. Dep't. of Gen. Serv.
In plaintiff's case against the state for breach of a lease, trial court's postjudgment order denying defendant's request to vacate that portion of a judgment awarding postjudgment interest against state at a rate of 10 percent is reversed and remanded as it gives effect to that portion of a judgment awarding postjudgment interest which is claimed to be void. Furthermore, the award in excess of 7 percent interest is void and thus subject to collateral attack because it constitutes relief which the court had no power to grant.

[10/23] Roberts v. Tishman Speyer Props., L.P.
In an action by tenants claiming that their landlords were not entitled to take advantage of the luxury decontrol provisions of the Rent Stabilization Law (RSL) while simultaneously receiving tax incentive benefits under the City of New York's J-51 program, the Appellate Division's order reversing dismissal of the complaint is affirmed where the RSL did not permit defendants to receive both types of benefits.

[10/09] Barrientos v. 1801-1825 Morton LLC
In an action under the Housing and Community Development Act challenging eviction notices issued by defendant-landlord, summary judgment for plaintiffs is affirmed where the Department of Housing and Urban Development's "good cause" regulation did not preempt the operation of the City of Los Angeles's eviction control ordinance.

[09/18] Delois v. Barrett Block Partners
In a landlord-tenant dispute, trial court's grant of defendants' SLAPP motion in striking plaintiff's six of ten causes of action is reversed where defendants' section 425.16 motion in the trial court did not, on the facts and pleadings of the case, satisfy the first prong of the statute and therefore, the trial court erred in granting it as to any of the causes of action in plaintiff's complaint.

[08/20] Fincher v. S. Bend Hous. Auth.
In a case involving alleged violations under the United States Housing Act and the Fair Housing Act, defendant's motion for dismissal of the appeal is granted where an order remanding a case to the state court from which it was removed is not reviewable on appeal or otherwise, as remands based on the Rooker-Feldman doctrine are jurisdictional, and thus subject to the prohibition of the appellate review in section 1447(d).

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