Contracts

Defendant, a Delaware corporation with headquarters in California, had a federal forum provision in its articles of incorporation which provided that any claims against it under the federal Securities Act of 1933 had to be brought in federal, not state, court.  This decision affirms an order dismissing without prejudice a Securities Act suit that one of the corporation's shareholders brought… Read More

As a Juul employee, Grove obtained stock options which he exercised to buy shares of Juul stock.  Grove sued Juul in California asserting a claim for the right to inspect Juul's books and records and also class and derivative claims against Juul's officers and directors.  The California court first stayed the inspection claim based on the forum selection clause in… Read More

Dameron required emergency room patients to sign a "conditions of admission" agreement, which assigned to the hospital the patients' rights under their auto insurance policies' uninsured or underinsurance motorist coverages and under the medical payments coverage.  This decision holds that assignment of un-or underinsured motorist coverage is contrary to public policy and unenforceable because it is merely a way to… Read More

Under Public Contracts Code 20104.50, a government entity that pays a contractor more than 30 days after receipt of an undisputed payment request must pay the contractor 10% interest on the delayed payment.  However, this decision holds that payment more than 30 days after receipt is not a breach of the construction contract if that contract only incorporates the Public… Read More

Defendant residential care facility's arbitration clause was procedurally unconscionable as (i) it was a contract of adhesion, (ii) it incorporated the AAA rules but no copy of them was provided, and (iii) the facility required a patient undergoing an acute psychotic incident, who could not concentrate for more than 10-20 seconds to sign the clause.  The clause was substantively unconscionable… Read More

Following Ajamian v. CantorCO2e, LP (2012) 203 Cal.App.4th 771, this decision holds that an arbitration clause calling for the arbitration of "any dispute" arising in connection with a contract does not "clearly and unmistakably" call for the arbitrator rather than a court to decide issues of arbitrability.  A provision calling for arbitration in accordance with AAA rules which themselves grant… Read More

Employer's arbitration clause was unenforceable because it was unconscionable.  The clause was a mandatory, non-negotiable requirement of employment.  It was procedurally unconscionable because it was given to plaintiff only in English, which he cannot read, and without a schedule of the arbitration fees he could be charged.  It was substantively unconscionable because it allowed the arbitrator to shift attorney fees… Read More

Defendant's website didn't adequately disclose the nature of the terms of service, and didn't point out either the arbitration clause or the hyperlink to the agreement.  As a form of sign-in wrap, the website failed adequately to show agreement to the defendant's terms when the customer simply hit the "continue" button. Read More

The Airline Deregulation Act of 1978 (49 USC 41713) preempted plaintiff's tort claims arising from defendant's decision not to use plaintiff's software that offered certain in flight deals to airline passengers.  Refusing to follow the Ninth Circuit's minority view (Charas v. Trans World Airlines, Inc. (9th Cir. 1998) 160 F.3d 1259), this decision holds that in flight deals are part… Read More

The trial court did not abuse its discretion in ordering a new trial in this case where the writers for the series Columbo sued the studio that produced those shows.  The trial court correctly concluded--only after the jury ruled--that it was for the court to interpret the contract between the parties and that the crucial term "photoplay" included each TV… Read More

A written waiver or release of future negligence claims or assumption of the risk in order to participate in recreational activities is enforceable.  Here, a high school required its football team players to sign such a release.  It barred plaintiff's claim for negligence in failing to diagnose the concussion he suffered playing football which led to serious brain damage.  Plaintiff… Read More

Following but distinguishing Sellers v. JustAnswer LLC (2021) 73 Cal.App.5th 543, this decision holds that Blizzard employed a form of sign-in wrap to show consent to its agreement for use of its website and games.  In the context of a continuing relationship to play Blizzard's games, its sign-in wrap adequately informed users that they had to agree to its terms… Read More

This decision holds that Lab. Code 925 is enforceable in federal court.  A California employee who was  not represented by counsel when he signed an employment agreement may void clauses in the contract that choose another state as the forum or another state's law as applicable law.  Having done so, the employee may enforce the contract in federal court, cleansed… Read More

The trial court properly denied a residential care facility's motion to compel arbitration.  The facility's arbitration agreement was signed by the admitted resident's son, not the resident.  The resident was not mentally incompetent at the time of admission, and he had not designated his son his attorney in fact, or agent.  The resident didn't ratify the arbitration agreement by not… Read More

Lab Code 925 prohibits employment contracts from containing provisions requiring an employee to litigate or arbitrate a claim in another state if the claim arises in California or depriving the employee of the substantive protection of California law in a suit arising in California.  A provision that violates the section is voidable by the employee, after which the matter shall… Read More

An employee did not agree to the employer's arbitration policy that was stated only in an employee handbook which the employee acknowledged receiving but did not sign anything agreeing to the employer's policies, particularly as the acknowledgement of receipt of the handbook didn't reference arbitration and the handbook itself said it was not an agreement.  The fact that the handbook… Read More

By failing to raise, in its opening memo on the motion to compel arbitration, the fact that the arbitration agreement contained a delegation clause that provided for the arbitrator to decide arbitrability issues, the defendant waived its right to rely on the delegation clause, and the court properly decided the arbitrability issues.  Waiting to raise delegation until the reply memo… Read More

Following Ahlstrom v. DHI Mortgage, Inc. (9th Cir. 2021) 21 F.4th 631, this decision holds that the court must always decide whether the party opposing arbitration entered into the agreement containing the arbitration clause.  That issue cannot be delegated to the arbitrator because the delegation clause itself is invalid if the opposing party didn't enter into the agreement containing it. Read More

A hospital cannot recover more for its emergency care of patients injured in car accidents than the amounts it has agreed with the patients' medical insurers to charge for those services.  Here, the hospital tried to collect more by requiring the patients to sign conditions of admissions that contained assignments of the patients' underinsured motorist coverage and medical benefits coverage… Read More

The parties' arbitration provision said that "except for claims seeking injunctive or other equitable relief," the parties agreed to arbitrate any dispute between them.  Plaintiff filed suit including among others claims for specific performance, rescission, and violation of the UCL.  This decision holds that all of those claims are equitable or seek equitable relief and thus are not arbitrable under… Read More