The Equalizer

New Supreme Court Ruling in Corporate Law

Recently the U.S. Supreme Court narrowed rules on where injury lawsuits may be filed in the country, which will favorably help corporations in the future. The recent ruling will put an end to the Legislature’s constant debate over tort reform, and will curb plaintiffs’ ability to “shop” for courts in states with laws helpful to such injury lawsuits.

For example, in the past St. Louis has been condemned for filing mass tort cases because juries are inclined to grant high damage awards and laws permit lawyers to combine multiple plaintiffs, sometimes from different states, as long as they include a local plaintiff to establish jurisdiction. Just recently plaintiffs were awarded more than $300 million in four recent jury verdicts against New Jersey-based Johnson & Johnson. This will now be a thing of the past.

Read full story here.

Combating Paparazzi Intrusiveness

Whether you like it or not, our society is heavily influenced by celebrities, as our country is driven by fame, glamour, social media and image more and more every year. Most celebrities have a love/hate relationship with the paparazzi, and with good reason. Some live by the motto that, “any publicity is good publicity,” while others consider the unwanted attention as intrusive, stifling, and even dangerous. The lengths that some paparazzi go through for a picture are unprecedented, such as engaging in high-speed chases on California freeway’s, putting the general public at risk.

On September 30, 2014 Governor Brown signed two bills into law to help combat paparazzi intrusiveness:

California Assembly Bill 1256 (AB 1256) – Privacy and Buffer Zones:

AB 1256 amends the California Privacy Law to include within the definition of “personal and familial activity” activities of children occurring at private and public schools, activities occurring at various medical facilities, and activities occurring where a reasonable expectation of privacy exists at other locations.” It also creates a new section in entertainment law that creates buffer zones around entrances and exits at specified facilities, including schools and medical facilities, to prevent barriers and obstructions from impeding ingress and egress to and from such facilities, and to prevent the interruption of important and vital functions of such facilities.

California Assembly Bill 1356 (AB 1356) – Stalking Reform:

AB 1356 amends the California Civil Stalking Law to include as actionable placing someone “under surveillance” in a way that causes “substantial emotional distress,” if all other elements of the law are proved. Licensed private investigators, law enforcement agencies and some other organizations and purposes for surveillance are exempt.

Until our society stops feeling the need to live vicariously through others, there will always be a paparazzi hovering around in the bushes somewhere.

The Case for a Will, Starring the Estate of Jimi Hendrix

Jimi Hendrix is considered by many the best guitarist that has ever lived, and although the legendary icon has been dead for over 40 years, his music, and unfortunately lawsuits, has kept his spirit alive. The Hendrix estate is one of the most-litigated in the history of entertainment litigation, which include copyrights and royalty rights. When he unexpectedly passed away at the age of 27 on September 18, 1970, he did not have a will. His father Al Hendrix inherited his $80 million dollar estate, becoming the protector of his legacy.

Jimi Hendrix’s family members had all separately set up a dozen beneficiaries of trusts and companies using their late family member’s likeness over the years, which was a source of constant strife.

Here is a chronological list of the most significant lawsuits pertaining to Jimi Hendrix’s estate:

1993: Al Hendrix sued his lawyer who was involved in shady dealings to win back his son’s image and music rights, that stating that he did not give his consent for such a transaction.
1995: Al Hendrix won court case against ex lawyer and advisor and formed Experience Hendrix LLC, the family-owned company that presides over all things Hendrix to this day.
2002: Al Hendrix died, leaving the full estate in his will to his daughter Janie. Her brother Leon sued to have their father’s will overturned and remove his sister Janie as the personal representative. He lost the suit.
2009: Janie Hendrix, controller of Experience Hendrix LLC, filed suit in the United States District Court against her brother Leon and his partner, alleging they were committing trademark infringement.
2014: Five years later, 9th Circuit Court of Appeals ruled in favor of Experience Hendrix LLC, leading to a settlement and one unknown settlement amount for the associated sale of merchandise (T-shirts, posters, etc.) that capitalized on Hendrix’s fame. In addition, the ruling also handed them the ability to crack down on any vendors selling unauthorized products bearing the Hendrix name or likeness.
2015: Now the estate of Jimi Hendrix is suing an Arizona guitar shop owner for the return of a guitar once owned by the rocker that was sold to him for $80,000 in 2014. The lawsuit claims the guitar was stolen by a sometime singer and guitarist for Earth, Wind & Fire, who is also a former member of The Commodores. The guitar is now allegedly worth near $1,000,000.
2016: Experience Hendrix sued for trademark infringement and dilution against Tiger Paw Beverage Company and Leon Hendrix who partnered in selling an alcoholic beverage named “Purple Haze Liqueur” inspired by the musician’s famous song. A Savannah court has now ruled that the Purple Haze Liqueur is “not similar” to any of the plaintiff’s registered trademarks and that there are no similarities in the way their products are sold, as the plaintiff uses online platforms and the defendant uses retail outlets. So the Hendrix estate doesn’t win them all.

The moral of the story, make a trust, make a will, make it solid and leave your family in peace.

Intentional Interference with Expectancy of Inheritance – Beckwith v. Dale

In 2012 California became the 26th state to recognize the tort of Intentional Interference with Expected Inheritance (IIEI) in the case of Beckwith v. Dahl, 205 Cal.App.4th 1039 (2012).  The tort provided a remedy in civil courts for anyone who lost all or part of an inheritance because of the tortious acts of another, and for which there was no adequate probate remedy.

Since Beckwith was decided, there have not been any other decisions in California that expand or restrict the holding.  While Beckwith has been cited by a handful of appellate cases, none of them has actually addressed the holding of Beckwith.  A recent review of appellate cases pending before the California Supreme Court indicates that not one Beckwith related matter is up for review.  A litigant is left to interpret the scope of Beckwith’s landmark decision.

Decisional authority establishing the scope and application of Beckwith will be important because a claim for IIEI differs greatly from a will contest in probate.

For example, traditionally, a testator’s intent is determined by a will contest in probate court.  If successful, the will is set aside in favor of an older version of the will or trust, or if there is no older version, then the estate’s assets pass via rules of intestacy.  Under IIEI, a successful claim will result in a judgment for money damages against the defendant, in the amount of the lost inheritance.

One very important difference is that an IIEI action in civil court comes with the right to a jury trial.  There is no similar right in probate court.  Recognizing this distinct advantage, the jurisdiction of the probate courts, and the potential for abuse if a claimant were to file one lawsuit in probate court, and one in civil court, Beckwith added a gatekeeper element – any IIEI claimant must have an “inadequate probate remedy.”  Basically, if you can bring your claim in probate court, you don’t have any right to bring the same claim in civil court for another bite at the apple.

The court in Beckwith wanted to protect the legislative intent in the Probate Code to allow probate courts to generally address inheritance disputes.  To do so, Beckwith essentially viewed an inadequate remedy in probate as synonymous with a lack of standing to pursue a will contest—an action only available in probate.

There is a seeming and potentially confusing similarity between the two types of claims between a will or trust contest and an IIEI claim.  An IIEI claim focuses upon how a third-party has prevented the testator from exercising his or her true intent, in ways similar to the focus of the probate court in “undue influence” cases, that is, cases where a testator has been so influenced, that his or her free will has been replaced by the will of another.

The differences and similarities raise issues as to how California courts will deal with Beckwith claims.

Consider this hypothetical:

Mother decides to split her estate 50/50 between her only son, Rick, and her best friend, Emily.   She tells both of them about her plans.  Mother signs a will to that effect, and stores it at her home.  Mother has no other potential heirs.  Subsequently, in the hospital with a terminal condition, she asks Rick to find the will.  Rick finds the will and destroys it.  He tells Mother that he was unable to find the will.  Mother instructs Rick to have a new will prepared for her signature.  Rick promises to prepare a new will, but stalls knowing that his Mother is terminal—he never intended to prepare a new will for Mother’s signature.  Eventually, Mother dies without having signed the new will, and the estate goes entirely to Rick as the only surviving heir of a deceased without a will.  Emily gets nothing because she is not related to Mother who died without a will.  In this scenario, Emily has a claim against Rick for IIEI.

Destruction of a will or trust document is an easy case.

Rick’s wrongful conduct aimed at Mother, the testator, caused the absence of a will splitting Mother’s assets 50/50 between Rick and Emily as Mother intended, and deprived Emily of her expected inheritance.

However, if you reverse the roles of Rick and Emily, and adjust the hypothetical, you can understand the distinction better between a tort claim in civil court and an adequate remedy in probate court which would restrict an IIEI claim.

Suppose Emily was asked by Mother to find her will.  Emily says that she can’t find the original will, and prepares a new will adjusting the percentages so that she takes 75% of Mother’s Estate.  Mother signs the will with Emily’s representation that the will splits her assets 50/50 between Rick and Emily.  Emily’s actions would satisfy each of the elements of an IIEI claim, but Rick will nevertheless be unable to bring a claim for IIEI because he has an “adequate probate remedy”—as his Mother’s son, he can contest the will in probate court—something Emily could not do.

There are sure to be many fact scenarios that will inevitably push the boundaries of Beckwith v. Dahl, especially they relate to whether there is an “adequate remedy in probate.”  Since this is an area where courts in other states have struggled, a review of cases from other states may be instructive in predicting how California courts will likely review the “adequacy of” probate remedies in the future.

Adequate remedies in probate:

1)         An Indiana Court has held that intestacy is an adequate remedy.  In Keith v. Dooley, 802 N.E.2d 54, 58 (Ind. Ct. App. 2004), the court determined that nephews and nieces’ will contest, if successful, would result in the bulk of the estate going to them.  The court determined that they had an adequate probate remedy because the remedies in the two actions were “substantially the same,” and dismissed the IIEI claim.

2)         According to the holding of one older California case, a “no contest clause” does not make probate remedy inadequate.  In Munn v. Briggs, 185 Cal.App.4th 578 (2010), decided prior to Beckwith, the petitioner asserted an inadequate remedy in probate as the basis for an IIEI claim because a no contest clause “suppressed any challenge to the Codicil in the probate action.”  In other words, the petitioner was concerned that any action in probate filed by him would prevent him from inheriting anything, and on that basis, was an inadequate probate remedy.  However, the Munn court determined that the potential results of a will contest was not a sufficient basis to establish an inadequate probate remedy: “[N]o beneficiary would ever risk ‘forfeiture’ based on an unsuccessful challenge in probate to a will or testament containing a no contest clause if that beneficiary instead could sue in tort and recover his or her expected inheritance without regard to, and the associated risk of a no contest clause.”

3)         Other courts have held that the availability of punitive damages in a tort action but not in probate, does not make probate remedy “inadequate”.  In Minton v. Sackett, 671 N.E. 2d 160 (Ind. 1996), the Petitioner argued that the lack of punitive damages in probate court made it an inadequate probate remedy.  The court found that the adequacy of a probate remedy is based upon whether there is an opportunity to pursue the remedy, not the actual remedy itself.  Courts “have consistently rejected the notion that punitive damages are a valid expectation for the purposes of determining the adequacy of relief in a will contest.”

 

Inadequate remedies in probate:

1)         It is difficult to reconcile all of the decisions on this subject, as fraudulent conduct has been held to be the basis for a finding of “inadequate remedy.”  In Schilling v. Herrera, 952 So. 2d 1231 (Fla. 2007), the defendant, a hired nurse, convinced the testator to change a will that left the entire estate to plaintiff, to a new will that left the entire estate to the defendant nurse.  When the testator died, defendant did not inform plaintiff, and completed the probate of the will without an opportunity for plaintiff to contest.  The court denied defendant’s argument that plaintiff had an adequate probate remedy because such a remedy would include a “fair opportunity to pursue it.”

2)         Statutes of limitation in probate are not applicable to civil actions.  In Estate of Ellis, 923 N.E. 2d 237 (Ill. 2009), the testator executed a will in 1964 in favor of plaintiff—plaintiff was unaware of the will.  In 1999, the testator executed a new will in favor of defendant, the pastor of testator’s church.  When the testator died, the 1999 will was admitted to probate.  Plaintiff did not discover the 1964 will until three years later, and filed both a will contest and a claim for IIEI.  The trial court barred both claims as untimely based on a statute that required a will contest within 6 months after the will was admitted to probate.  The Supreme Court held that applying the probate statute to a tort claim “contradicts the clear and unambiguous language of the statute and confuses the tort with a will contest.”

3)         Depleted estates.  In Peralta v. Peralta, 131 P. 3d 81 (N.M. Ct. App. 2005), the testator left her estate equally to three children.  Two of the children caused the testator to transfer the major assets of the estate to them as payable-on-death beneficiaries, and virtually depleted the entire estate by the time the testator had died.  The trial court dismissed plaintiff’s IIEI claim because an adequate probate remedy existed.  However, the appellate court concluded that where an estate is virtually depleted prior to death, there is no adequate remedy in probate.

How California courts will deal with these issues, in fashioning remedies for wrongful conduct and in respecting the probate courts’ administration of trusts and estates, remains to be seen – as IIEI cases wind their way through the judicial system to the Appellate Courts.  Stay tuned.

The Boesch Law Group prosecutes and defends some of the most complex IIEI cases in the country.

What You Can and Can’t Do With a Phone While Driving

Update:

Assembly Bill 1785 is a groundbreaking new law that takes effect January 1, 2017. It states “holding and operating a handheld wireless telephone or an electronic wireless communications device unless the wireless telephone or electronic wireless communications device is specifically designed and configured to allow voice-operated and hands-free operation, and it is used in that manner while driving.” It prohibits motorists from holding their phone while driving, and drivers may only perform the motion of a single swipe or tap of a device while it is mounted in a vehicle.

Safety officials are hoping AB 1785 will plug a major loophole in the state’s original hands-free cellphone laws. While it is already illegal for drivers to call or text without a hands-free device, the law was silent on features that were not in wide use on cell phones when the original measures were passed by the legislature more than eight years ago. This includes checking and updating their social media profiles, navigation apps, scrolling through music playlists, and taking photos or videos.

“This bill targets the deadliest cause of distracted driving related crashes, the use of an electronic device while driving,” Assembly member Bill Quirk, the author of AB 1785, said of his bill. A California Office of Traffic Safety study this year determined that 1 out of 8 drivers on the road are paying as much attention to his or her smartphone as to the road. State road safety officials estimate that some form of distracted driving is a factor in 80 percent of crashes.

The Boesch Law Group has seen this issue from all sides—defending those accused of distracted driving, and litigating civil claims against cellphone users who cause auto accidents.

People of all ages move from place-to-place looking at smartphones, checking apps, maps, music, email, texting, speaking; it’s a common sight to see people looking at their phones while sitting at red lights. Police officers are trained to check immediately for cellphone use at the scene of accidents as texting has become a common driving distraction; and the dangers from distracted driving are real.

Cars and cellphones: where do you draw the lines? Most Californians know by now: it’s against the law to talk on a handheld phone while driving. It is easy to know that you’re in compliance with the law if you have two hands on the wheel. As technologies become more and more sophisticated, touchscreens on your dashboard access not only radio and sound systems and music libraries, but also internet, text and written and dictated emails. While Siri and other helpers have made it possible to communicate with two hands on the wheel, the violations unfortunately are too frequent, and the consequences too often serious and tragic.

Because people reach for their cellphones while driving, it is important to know the scope and limitations of the rule against cellphone use. We know technology is moving faster than the law—what about touchscreens that operate a cellphone like tuning a radio? What about holding a phone in speaker mode? What can you do and what can you not do?

California Vehicle Code §23123 specifically states that a “person shall not drive a motor vehicle while using a wireless telephone unless that telephone is specifically designed and configured to allow hands-free listening and talking, and is used in that manner while driving.” Exceptions to the “talking while driving” rule provided in this statute include making an emergency call or driving on private property. Other exceptions apply to emergency service professionals using a phone while driving an emergency vehicle.

California Vehicle Code §23123.5 was very specific in prohibiting the use of a cellphone while driving “to write, send, or read a text-based communication, unless the electronic wireless communications device is specifically designed and configured to allow voice-operated and hands-free operation to dictate, send, or listen to a text-based communication…” A “text-based” communication is defined by the statute as “including, but not limited to, communications referred to as a text message, instant message, or electronic mail.” Sending an email or updating your Facebook status is a violation. Dictating a text or email is not.

This statute seemed sufficient when it was enacted in 2006, the bygone era of the RAZR and “flip” phones. Smartphones, however, are mobile, hand-held computers capable of extraordinary interactions, far beyond what legislators were thinking about when they banned speaking through a hand-held phone. We know you cannot text or talk with a phone in your hand, but what about using a GPS application? A music app? Watching a ballgame? Touching a screen that does dozens of things?

In People v. Spriggs (2014), 224 Cal. App. 4th 150, the Court of Appeal reviewed the case of a driver cited for using his phone’s GPS application while in heavy traffic. The DA argued that the driver clearly violated the statute by using a handheld device while driving. The danger of distracted driving, he argued, was as real as looking at a map as holding a phone. The trial court agreed and fined the driver for violating California Vehicle Code §23123. But the Court of Appeal reversed, stating that California Vehicle Code §23123, only prevented drivers from engaging in conversation while driving unless the phone was used in a hands-free manner. The Legislature, the Court held, was not even thinking about maps or navigation aids at the time. So they couldn’t have intended to preclude uses they never imagined.

The key phrase in the statute upon which the Court of Appeal relied, was “hands-free listening and talking.” In response to the District Attorney’s argument that the statutory language prohibits any use of a hand-held phone while driving, the Court of Appeal disagreed and held that the statute did not prohibit any use of the phone. Looking at the display, holding “the phone in one’s hand, even if configured for hands-free listening and talking,” looking at the time or merely moving the phone “for use as a paperweight,” were not prohibited. It was not a violation of the Code to look at a map on one’s phone. These things might be distracted driving, and dangerous, but not by themselves illegal.

Based on the ruling in People v. Spriggs, drivers may check their GPS and talk on the phone while driving, even if the phone is in-hand, so long as the phone is set to “speaker mode.” Since 2006, mobile apps are everywhere—some even to help drivers – Google Maps and Waze to name a few – and unless and until changes are made to the statute, People v. Spriggs will stand for the proposition that all cellphone use, even hand-held, is not prohibited.

Keep your eyes on the road and two hands on the wheel and you should have no problem. Look down with your hands in your lap, and that can be probable cause for a police stop. See People v. Corrales (2013), 213 Cal. App. 4th 696 (even though the officer never saw the cellphone in Defendant’s hands, the officer saw the Defendant repeatedly looking down at his hands and making movements with his hands which the officer reasonably believed were associated with text-messaging).

The takeaway? Violate the law, get into an automobile, truck, or motorcycle accident, and you may not only face criminal prosecution, but possibly civil and perhaps even punitive damages as well. The moral of the story: Keep your phones on speaker and your eyes on the road.

Original Article:

The Boesch Law Group has seen this issue from all sides—defending those accused of distracted driving, and litigating civil claims against cellphone users who cause auto accidents.

People of all ages move from place-to-place looking at smartphones, checking apps, maps, music, email, texting, speaking; it’s a common sight to see people looking at their phones while sitting at red lights. Police officers are trained to check immediately for cellphone use at the scene of accidents as texting has become a common driving distraction; and the dangers from distracted driving are real.

Cars and cellphones: where do you draw the lines? Most Californians know by now: it’s against the law to talk on a handheld phone while driving. It is easy to know that you’re in compliance with the law if you have two hands on the wheel. As technologies become more and more sophisticated, touchscreens on your dashboard access not only radio and sound systems and music libraries, but also internet, text and written and dictated emails. While Siri and other helpers have made it possible to communicate with two hands on the wheel, the violations unfortunately are too frequent, and the consequences too often serious and tragic.

Because people reach for their cellphones while driving, it is important to know the scope and limitations of the rule against cellphone use. We know technology is moving faster than the law—what about touchscreens that operate a cellphone like tuning a radio? What about holding a phone in speaker mode? What can you do and what can you not do?

California Vehicle Code §23123 specifically states that a “person shall not drive a motor vehicle while using a wireless telephone unless that telephone is specifically designed and configured to allow hands-free listening and talking, and is used in that manner while driving.” Exceptions to the “talking while driving” rule provided in this statute include making an emergency call or driving on private property. Other exceptions apply to emergency service professionals using a phone while driving an emergency vehicle.

California Vehicle Code §23123.5 was very specific in prohibiting the use of a cellphone while driving “to write, send, or read a text-based communication, unless the electronic wireless communications device is specifically designed and configured to allow voice-operated and hands-free operation to dictate, send, or listen to a text-based communication…” A “text-based” communication is defined by the statute as “including, but not limited to, communications referred to as a text message, instant message, or electronic mail.” Sending an email or updating your Facebook status is a violation. Dictating a text or email is not.

This statute seemed sufficient when it was enacted in 2006, the bygone era of the RAZR and “flip” phones. Smartphones, however, are mobile, hand-held computers capable of extraordinary interactions, far beyond what legislators were thinking about when they banned speaking through a hand-held phone. We know you cannot text or talk with a phone in your hand, but what about using a GPS application? A music app? Watching a ballgame? Touching a screen that does dozens of things?

In People v. Spriggs (2014), 224 Cal. App. 4th 150, the Court of Appeal reviewed the case of a driver cited for using his phone’s GPS application while in heavy traffic. The DA argued that the driver clearly violated the statute by using a handheld device while driving. The danger of distracted driving, he argued, was as real as looking at a map as holding a phone. The trial court agreed and fined the driver for violating California Vehicle Code §23123. But the Court of Appeal reversed, stating that California Vehicle Code §23123, only prevented drivers from engaging in conversation while driving unless the phone was used in a hands-free manner. The Legislature, the Court held, was not even thinking about maps or navigation aids at the time. So they couldn’t have intended to preclude uses they never imagined.

The key phrase in the statute upon which the Court of Appeal relied, was “hands-free listening and talking.” In response to the District Attorney’s argument that the statutory language prohibits any use of a hand-held phone while driving, the Court of Appeal disagreed and held that the statute did not prohibit any use of the phone. Looking at the display, holding “the phone in one’s hand, even if configured for hands-free listening and talking,” looking at the time or merely moving the phone “for use as a paperweight,” were not prohibited. It was not a violation of the Code to look at a map on one’s phone. These things might be distracted driving, and dangerous, but not by themselves illegal.

Based on the ruling in People v. Spriggs, drivers may check their GPS and talk on the phone while driving, even if the phone is in-hand, so long as the phone is set to “speaker mode.” Since 2006, mobile apps are everywhere—some even to help drivers – Google Maps and Waze to name a few – and unless and until changes are made to the statute, People v. Spriggs will stand for the proposition that all cellphone use, even hand-held, is not prohibited.

Keep your eyes on the road and two hands on the wheel and you should have no problem. Look down with your hands in your lap, and that can be probable cause for a police stop. See People v. Corrales (2013), 213 Cal. App. 4th 696 (even though the officer never saw the cellphone in Defendant’s hands, the officer saw the Defendant repeatedly looking down at his hands and making movements with his hands which the officer reasonably believed were associated with text-messaging).

The takeaway? Violate the law, get into an automobile, truck, or motorcycle accident, and you may not only face criminal prosecution, but possibly civil and perhaps even punitive damages as well. The moral of the story: Keep your phones on speaker and your eyes on the road.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

 

 

The Boesch Law Group Takes on the Judgment Obtained by a Chinese Government-Owned Company

In a case with international implications involving breach of contract and interference with contractual relationships, the Boesch Law Group achieved an important milestone on March 24, 2015, when the Ninth Circuit Court of Appeals issued its opinion in favor of Folex Industries, a California corporation and a client of the Boesch Law Group. The legal question was whether a Chinese court ruling obtained by a Chinese government-owned company should be enforced in the United States.

As U.S. trade and business transactions with Chinese companies have grown dramatically in the last few years, this case was closely watched by international law experts. “It would be unfair to all who do business with China,” Philip Boesch argued to the Ninth Circuit Court of Appeals, “if Chinese government orders and decrees could just take away contracts and rights without due process of law.” Agreeing with Boesch’s arguments, the Ninth Circuit held that the Chinese judgment against Folex was not enforceable, that service of the Chinese lawsuit was improper, and that the Chinese court did not properly assume jurisdiction over Folex. The Ninth Circuit additionally agreed with Mr. Boesch, that even if there had been effective service of the Chinese lawsuit, non-parties to the judgment cannot enforce the Judgment because non-parties in China do not have such rights.

The winning Ninth Circuit argument can be viewed below:

For the complete argument, click here.

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

Defeating Extortion and Abuse of Process in All Their Ugly Disguises

“Pay me or I’m going to the police…” “Pay me or I will tell the press about you…”
Or perhaps someone has filed a lawsuit against you that has an ulterior motive. These actions might or might not be an abuse of process, a tort in the state of California — or worse, the tort (and potential crime) of extortion. Whether you are owed money and frustrated, or are on the receiving end of demands, you may need legal advice.

Extortion is not only a criminal act, but also a tort that may be addressed directly, with or without law enforcement. California’s common law allows for a civil cause of action to recover damages due to extortion – including by the wrongful threat of criminal or civil prosecution. In order to assert a claim for extortion, there must have been a threat of prosecution accompanied by knowledge of the falsity of the claim, and the wronged party must have paid the money demanded. See Fuhrman v. California Satellite Systems (1986), 179 Cal. App. 3d 408, overruled on other grounds, Silberg v. Anderson (1990), 50 Cal. 3d 205.

As distinguished from extortion, abuse of process is the actual filing of a lawsuit or the taking of other legal action, to achieve a purpose unrelated to the substance or merits of the legal action. To prove an abuse of process, a plaintiff must show that the defendant entertained an ulterior motive in using the legal process, and committed a willful act in a wrongful manner. See Coleman v. Gulf Insurance Group (1986) 41 Cal.3d 782, 792. “The gist of the tort is the misuse of the power of the court: It is an act done under the authority of the court for the purpose of perpetrating an injustice, i.e., a perversion of the judicial process to the accomplishment of an improper purpose. Younger v. Solomon (1974), 38 Cal.App.3d 289, 297.

Extortion is defined by California’s Penal Code §518 as the obtaining of property from another, with his or her consent induced by a wrongful use of force or fear. Fear, for purposes of extortion, may be induced by a threat, either to accuse the individual threatened of any crime, or to expose, or impute to the threatened individual any deformity, disgrace, or crime. See Pen. Code, §519.

A threatened action does not have to be illegal for extortion to have occurred. For example, if a person threatens to report an actual crime to the police, the action that is threatened – the reporting of a crime – is not illegal. However, when the threat is coupled with a demand for money, the threat may become illegal and may constitute extortion. “It is the means employed to obtain the property of another which the law denounces, and though the purpose may be to collect a just indebtedness arising from and created by the criminal act for which the threat is to prosecute the wrongdoer, it is nevertheless within the statutory inhibition. The law does not contemplate the use of criminal process as a means of collecting a debt.” Flatley v. Mauro (2006), 39 Cal. 4th 299, 303. In other words, it is the use of fear as a weapon in order to obtain money or property from another which the law condemns, even if the money or property is rightfully owed.

Extortion can occur whether or not the victim is guilty of the crime or indiscretion with which he or she is being threatened. Additionally, the crime or indiscretion does not need to be specific – the accusation need only be such as to put the victim in fear of being accused of some crime. In fact, many extortionists use vague and general accusations in order to magnify the fears of the victim, and in order to protect themselves from prosecution in the event that the attempt fails to extract money.

Threatening criminal prosecution in an effort to gain some advantage in civil litigation can be abuse of process and extortion. For example, in Miguel Mendoza v. Reed Hamzeh (2013) 215 Cal. App. 4th 799, attorney Hamzeh was seeking to recover money owed to his client by Mendoza. He wrote a letter to Mendoza’s attorney stating that, if Mendoza did not pay the money owed, Hamzeh would proceed with filing a civil complaint, as well as reporting Mendoza to the Attorney General, the District Attorney, the Internal Revenue Service, and the Better Business Bureau. The attorney was sued for civil extortion. It is irrelevant whether Mr. Mendoza indeed owed the money, or even whether he should indeed have been reported to the Attorney General, District Attorney, IRS, etc… What the attorney did wrong was to use the fear of that reporting to demand money from Mendoza.

Often, people who are guilty of indiscretion or who do owe money, turn the tables on the extortionist – who may quickly be moved from aggrieved plaintiff to a defendant. The lessons of the David Letterman affair are clear. Demand money for anything that even looks like or smells like an offer to “keep quiet,” and you may very well find yourself sued and/or prosecuted.

If you have been the victim of civil extortion or abuse process, or you are trying to assert legitimate rights without being, you should contact an experienced Los Angeles attorney who has dealt extensively with these issues. The Boesch Law Group can help you recognize and protect your rights in this area. To speak with a member of our Southern California legal team, please call (310) 578-7880.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

 

 

Cases Can Often Begin and End With a Competent Evaluation of Lost Profits

No matter what type of claim you may be facing, whether you are the plaintiff or the defendant, an evaluation of damages is the first step toward determining how to proceed. Understanding lost profits is often a crucial part of that evaluation, and our professionals at the Boesch Law Group are both experienced and adept in making solid calculations which are accepted by the courts.

In many cases, the exact amount of damages is impossible to establish, and estimates based on the best factual evidence available, frequently bolstered by expert testimony, are the best that can be presented. Courts understand this reality, especially where it is the opposing party’s conduct that has made a precise damages calculation impossible, and have ruled that the offending party “cannot complain if the probable profits are of necessity estimated.” See Sanchez-Corea v. Bank of America (1985), 38 Cal. 3d 892, 908. In fact, the Restatement (Second) of Torts acknowledges that, while it is desirable “that there be definiteness of proof of the amount of damages as far as is reasonably possible,” nevertheless, it “is even more desirable… that an injured person not be deprived of substantial compensation merely because he cannot prove with complete certainty the extent of harm he has suffered.” This is particularly true in situations involving “anticipated profits.” See Rest.2d Torts, § 912, com. a, p. 479.

While it is true that difficulty in ascertaining the amount of damages will not preclude recovery, estimates and approximations based on solid factual evidence are tried, true and accepted by the courts – but speculation is not. The law requires a “reasonable basis of computation of damages… even if the result reached is an approximation.” See GHK Associates v. Mayer Group, Inc. (1990), 224 Cal.App.3d at 856, 873-874 (emphasis added).

In business cases, damages typically are calculated based on the company’s past net profits, not its gross revenue. Damage for lost profits from an established business are more easily calculated and awarded by the court when the company has enough operating experience to allow a reasonable estimate both of its probable future income and its anticipated future expenses. See Piscitelli v. Friedenberg (2001), 87 Cal.App.4th 953, 989. These estimates should be based on complete and accurate historical data, and the “occurrence and extent of lost profits may be determined with reasonable certainty from the working experience of the business, from its past volume and from other data reflecting probable future volume.” See Guntert v. City of Stockton (1976), 55 Cal.App.3d 131, 143.

When there is a new business with no track record of performance or income, the lost anticipated profits arising from conduct which prevents or interrupts the business activities are more difficult to recover, because the profits are “uncertain, contingent and speculative.” However, they may still be recovered if there is sufficient evidence on which to base a reasonable argument for their future occurrence and the extent – “absolute certainty as to the amount is not required; reasonable certainty is sufficient.” See Kids’ Universe, (2002) 95 Cal. App. 4th 870, 883. In such cases, “expert testimony, economic and financial data, market surveys and analyses, business records of similar enterprises, and the like” can be relied upon to provide the “reasonable certainty” required by the court to award damages for lost profits. Id. at 884. Courts will also look at evidence such as business plans, investment analyses, and profit projections, as long as they were prepared prior to the litigation.

Lost profits calculations can also be difficult when the business revolves around the good will of its owner(s). When a company’s profits rely largely upon the reputation and performance of one or a few individuals, the lost profits that will be suffered because of damage to that reputation and performance must be carefully calculated based upon the best available evidence, which may include an analysis of the company’s past earnings, competitors’ earnings, market performance, and expert testimony. The general rule for lost profits remains – the courts will allow a plaintiff to show with reasonable certainty that he or she has suffered damages, and once the cause and existence of the damages have been established, the courts will not deny recovery because the damages are difficult to ascertain. As long as the best evidence available is given, the defendant will not be allowed to complain that the amount of damages has not been determined with mathematical precision. See e.g. Stott v. Johnston (1951), 36 Cal.2d 864, 875, 876.

Many times, complex issues of proof and evidence arise and require the most competent representation and preparation, particularly when economic damages arise from many factors, and not just from the allegedly wrongful conduct. In fact, a defendant’s conduct need not be the sole proximate cause of damage in order for there to still be an award of damages. When that is the case, the defendant must prove that the damages can be reduced proportionately by other causes. If the defendant cannot clearly show the limited extent of his or her contribution to the damage, the defendant will be held liable for the entire loss. See Haft v. Lone Palm Hotel (1970) 3 Cal. 3d 756, 744.

The lesson here is that full recovery of damages for lost profits that are due, or the best defenses against speculative and exaggerated claims, require the most able analysis and competent representation. Don’t be subject to such a painful lesson. Call a Los Angeles-based expert attorneys at the Boesch Law Group today: (310) 578-7880.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

Are Non-Compete Agreements Enforceable?

Many business contracts—whether partnership agreements, distribution agreements, operating agreements, or employment agreements—include non-competition clauses. When two parties are doing business together, important and sometimes confidential information and trade secrets are passed or learned; and so it is natural for businesses to protect themselves with contract clauses designed to prevent contract associates or partners from taking their clients or customers. But because public policy favors “free and open competition,” clauses restraining competition are narrowly construed, limited and sometimes plainly prohibited. Knowing the rules, what works and what doesn’t, is essential business practice—and at the Boesch Law Group, our professionals have negotiated, drafted and litigated all types of competition clauses.

When business partners split, or executives decide to leave a company, when business contracts end, questions inevitably arise about what happens next.

Non-compete agreements are governed in California by California Business & Professions Code §16600. The statute provides that “every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void.” However, there are exceptions to this rule, and it does not apply in certain situations, for example, when a business is bought or sold.

California courts consistently interpret the non-competition statute in favor of open competition and employee mobility. The law protects California workers and ensures that every citizen shall retain the right to pursue any lawful employment and enterprise of their choice. It protects the important legal right of persons to engage in businesses and occupations of their choosing. In finding that a non-competition agreement was invalid because it restrained an employee’s ability to practice his accounting profession, the California Supreme Court in Edwards v. Arthur Andersen LLP (2008), 44 Cal. 4th 937, stated plainly that it “generally condemns non-competition agreements.” This condemnation arises out of the theory that the interests of the employee in his own mobility and betterment are deemed paramount to the competitive business interests of the employers. See Dowell v. Biosense Webster, Inc. (2009), 179 Cal. App. 4th 564, 575.

Non-compete agreements are regularly invalidated in cases where the departing employee is a professional with a specific set of skills. For instance, in Hill Med. Corp. v. Wycoff (2001), 86 Cal. App. 4th 895, a radiologist’s professional practice consisted solely of providing radiology services, so the non-competition agreement would effectively prevent him from practicing his trade. Therefore, the court ruled that the agreement was void.

Many businesses argue that non-compete agreements are necessary in order to protect trade secrets. Indeed, where narrow restraints prohibit employees from using confidential information taken from the former employer, the courts occasionally have held such provisions to be lawful. If, however, there is an outright prohibition on competition, the agreement will be void. See Hair Club for Men, LLC v. Elite Solutions Hair Alternatives, Inc. (2007), U.S. Dist. LEXIS 30167.

Furthermore, in fairly recent cases, the courts have even questioned whether the protection of trade secrets is a valid exception to the rule against non-compete agreements. For example, in Dowell v. Biosense Webster, Inc. (2009), 179 Cal. App. 4th 564, 577, the court stated, that “…we doubt the continued viability of the common law trade secret exception to covenants not to compete”. In Richmond Techs, Inc. v. Aumtech Bus Solutions (2011), U.S. Dist. LEXIS 71269, 60-61, the court ruled that non-solicitation and non-interference provisions in a non-disclosure agreement would likely be unenforceable under California law, considering that “[o]ther cases suggest that case law protecting trade secrets does not actually create an exception to Section 16600, but instead enables courts to enjoin the misuse of trade secrets as an independent wrong, either as a tort or a violation of the Unfair Competition Law.” The court ultimately ruled that the provisions would have the effect of restraining defendants from pursuing their chosen business and professions if enforced.

Despite broad judicial condemnation of non-compete clauses, it is clear that the statute does not apply to clauses included with the sale of businesses, whether corporations, partnerships, and LLCs. The exception serves an important commercial purpose by protecting the value of the business acquired by the buyer. In the case of the sale of the goodwill of a business, the reasoning goes, it is unfair for the seller to then engage in competition with his old business, which will diminish the value of the asset that he sold. The exception permits a business purchaser to protect itself against competition from the seller which would reduce the value of the acquired business. In such cases, the non-compete agreement often is a material part of the purchase and sale of the business and is intended to protect the business’ goodwill, for which the seller received compensation as part of the transaction. The limitations applied by these exceptions must still not circumvent California’s deeply-rooted public policy favoring open competition. The non-compete portion of the sales contract must clearly state that it falls within the limited exception, and the practical effect of the transaction and the economic realities must be considered.

The Boesch Law Group has considerable experience dealing with non-compete agreements, both in pre-litigation negotiation, mediation and in litigation. Whether you are drafting, negotiating, enforcing or attacking a non-competition clause, you should consult with an experienced non-solicitation attorney who can advise you as to the latest developments in the law and how they may apply to your situation. Our Los Angeles-based business attorneys at the Boesch Law Group are highly skilled in this area and can advise you of your rights.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

Article by Philip W. Boesch, Jr. for Realty 411 Guide

America’s TOP ATTORNEY on Combating Realty Fraud

Real estate fraud is alive and kicking. Many industry experts anticipate real estate scams and legal issues to escalate in tandem with the new housing boom in the U.S.

So how can investors at all levels enjoy sustainable investing, fend off risks of fraud, and better fulfill their goals of solving the issues they care about the most?

THE EMERGING FRAUD BOOM

Median existing home prices rose 11.5% last year, according to the latest data from the National Association of Realtors. NAR forecasts the median price of a new home will hit $289,700 by 2915. Based upon global, historical housing cycles, the new U.S. housing boom phase should last another seven to fifteen years. As the momentum grows during these periods, more and more Realtors get their licenses lenders have to work harder to complete for business, and an increasing number of individuals scale up their investments in real estate. Unfortunately, this often goes hand-in-hand with opportunists seeking to take advantage of the market, resulting in the rise of real estate and mortgage fraud. Sadly, barely a day seems to go by without another real estate mogul or industry worker being indicted or sentenced for their part in these scams.

Hop onto the most popular online real estate investment forums and a festering pool of potential fraud can be found. Here new investors looking for shortcuts are often misled by poor information, and others boast about how they fooled the banks and got away with it. At the same time, the surge in new real estate crowdfunding portals is set to make navigating the investment industry even more complex.

So how can real estate investors avoid being victimized by scammers, become unwittingly involved in fraudulent practices, and prevent temptation? What should they do if they feel something isn’t right?

LEDGERS, LAWYERS & LIQUIDITY

Who better to ask about legal protections from real estate fraud than America’s top legal eagle? The Boesch Law Group in Los Angeles, CA has been ranked one of the top 2% of law firms in the nation. The Boesch Law Group, and founder, Philip W. Boesch Jr. have been involved in landmark cases including the Michael Jackson wrongful death case. He won the “Number One Judgment in the Nation”, in the Anna Nicole Smith case, and he and his firm have achieved unmatched success in business and commercial litigation. The firm has successfully handled many challenging and complex real estate problems.

In an exclusive interview, Philip Boesch pointed to “under-performing assets” as the number one underlying issue in many of the legal cases being brought to the firm.

Boesch explained further that “under-performing assets, combined with poor liquidity and poor expectations” are frequently the root cause of cases where fraud is alleged. When expectations aren’t met, and promises aren’t delivered on, many pursue unsustainable shortcuts. These shortcuts put many on the fast track to nowhere but the courtroom.

When asked what the single best defense to avoid the temptation of committing fraud or becoming victim to it was, Philip pointed out the value of “an experienced team for vetting plans and reviewing prospectuses, up front”.

This goes beyond just an experienced real estate and business attorney, to include tax advisers, financial planners and wealth managers or business consultants too. Having multiple sets of veteran eyes review and evaluate the strengths of a business plan or financial projections can help identify and avoid potential cash flow challenges and alert individuals to options which could increase the potential of success.

On the most important first steps to take for those believing they may be victims of fraud, Philip Boesch recommends exercising rights to “review books and records” including the “general ledger and any available accounting software downloads such as from Quickbooks.”

Many real estate project and investment opportunity promoters and organizers may not want this information on public display. It is wise for any investor to lean towards opportunities which offer the most transparency and to pay attention to information access in initial agreements.

MAINTAINING PROPERTY VALUES & PIONEERING CHANGE

Real estate, as distinguished from publicly-traded REITS or funds, is typically an illiquid if not long-term investment. To realize maximum value, as Boesch notes, investors are often advised that the property must be held for some period of time, during which the market can fluctuate up or down. Whenever investors are involved in a partnership, or a limited liability company, or a corporation, and are required to hold the investment for some period of time, it is inevitable that partners or members can grow apart in their expectations. Family issues, divorce, death, personality clashes, life changes, job changes, often can lead to changing needs and expectations. And “change brought about by these every day human events,” Boesch says, “can lead to differences, over when and how, to cash out of an investment.”

Ups and downs in real estate can be subjected to other legal challenges that impact value. Boesch cites hanging shorelines from climate change, neighbors or public entities clashing with private property rights to exercise control over development, and environmental challenges, as just a few of the current events that are affecting real estate investments. Environmental issues in particular have attracted the Boesch Law Group’s attention as Philip Boesch has developed the reputation as one of the leading legal minds and protectors of the environment.

During his tenure as President of Heal the Bay, the organization achieved the adoption of rigorous new standards to reduce coastal pollution, the completion of a multi-billion dollar sewage treatment facility, and successful litigation against the EPA to enforce protection laws. Presently active on the Board of Directors of TreePeople, the leading environmental group promoting sustainable solutions for our urban environment, he is not only passionate about dealing with water and climate change issues, but about green solutions, sustainable self-sufficient development, and organic construction materials. All of these items should be on the radar of real estate investors and developers.

THE FUTURE OF REAL ESTATE FOR SOPHISTICATED INVESTORS

Anticipating future challenges as shorelines are altered by climate change, and as pollution and regulations evolve into new legal battles, Boesch encourages real estate investors to pay attention to how these changes will affect property values. Coastline erosion and waterway pollutants, for example, could dynamically shift demand and value to properties several blocks inland, but increase disputes over walkways and views.

Those with the foresight to recognize these trends and optimize their investment strategies appropriately will be those that are most successful.

EMPOWERING YOUR LEGACY

“Being a good neighbor and working with local governments doesn’t mean surrendering your private property rights,” Boesch says. He directs those passionate about sustaining the value of their real property investments to TreePeople’s mission, as a strong example of how to preserve wealth by sustainable, environmentally sound management.

Several years before the real estate crash of 2007, people would ask me, “Is there a real estate bubble?” I had to emphatically tell them that we were already deep into a bubble with some areas having already “popped”. One of the reasons they would ask was because they wanted to know if a particular area was going to appreciate in value.

Here is the lesson that so many investors had to learn the hard way – including myself‘

Don’t buy real estate with the idea that you are going to make your money through appreciation. It’s a huge mistake and an easy trap to fall into.

It’s hard to predict the future, especially years in advance. Back during the boom, everybody was looking back in hindsight and saying, “Boy, what if I’d invested in that city and got the 30% annual increase in value on the house I bought – that would have been great!” But hindsight doesn’t do us much good. It’s like gambling and is usually based on luck.

“Investing” based on appreciation is called speculation, but what I’m talking about is a much more conservative approach to building wealth with a real estate portfolio.

Build it so you know there will be cash-flow and equity growth when you’re ready to retire. If you’re going to speculate then you’ve got to be prepared to lose all of the cash you spent to acquire the property and potentially more.

Continued success!

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DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

To Be or Not to Be, in Probate Court

 

In general, causes of action provided for in the Probate Code require filing petitions and responses.

If a cause of action is not expressly authorized by the Probate Code, matters of pleading and procedure are governed by the Code of Civil Procedure. This is also true of Probate Code matters except to the extent the Probate Code provides otherwise. (Prob Code §1000).

In planning to initiate a “hybrid” action, where a trust litigation matter involves both probate matters and civil matters in a single case, practitioners must confront the realities of the confusing state of California law regarding the consequences of whether a cause of action is “probate” or “civil.” In particular, the practitioner must take into account the controversy over whether filing a cause of action using the wrong pleading (a complaint rather than a petition or vice versa) is an error having jurisdictional, rather than merely procedural ramifications.

The source of this controversy is a combination of history, combined with the practical consequences of having two sets of procedures.

• The Probate Court was abolished as a separate court in California in 1879. 18 Cal L Revision Comm’n Reports 1281 (1986). The Probate Court had been a court of limited jurisdiction.

• Following abolition of the Probate Court as a separate court, the California courts managed to retain limited jurisdiction concepts for probate matters by creation of the concept of the “Superior Court sitting in probate.” This resulted in decades of litigation regarding the parameters of the power of the Superior Court sitting in probate, particularly with respect to jurisdiction to decide cases involving “third parties” and powers to grant equitable remedies.

• Until 1971, testamentary trust matters were probate matters, but inter disputes involving revocable vivos or living trusts were treated as civil matters. At that juncture, some matters concerning inter vivos trusts became probate matters. Stats 1970, ch 849, enacting former Probate Code §§1138-1138.13.

• This state of affairs led to a situation in which cautious practitioners for prudent plaintiffs would “double file” cases which even vaguely appeared to involve a combination of “probate” and “civil” matters. A petition would be filed with a probate case number. A complaint would be filed with a regular case number. The various notice and service of process requirements would be satisfied for both cases. One or more parties might then make a motion for consolidation of the two cases in one court.

• In 1986, the new California Trust Law was enacted. New Probate Code §17000 made clear that the Superior Court had jurisdiction over the internal affairs of trusts, and Probate Code §17001 made clear that the court was a “full power court” when exercising that jurisdiction. The latter provision presumably made clear that the Superior Court could exercise all of its powers, including equitable powers, when exercising jurisdiction over trusts. (A similar provision in Probate Code §7050(b) applies to decedent estates, but there is no such provision applicable to guardianships or conservatorships.)

• Many practitioners thought Probate Code §§17000-17001 had the effect of eliminating any jurisdictional distinctions between the Superior Court acting in exercise of its trust jurisdiction and the Superior Court operating in exercise of its general jurisdiction. This view was not shared by the Court in Estate of Mullins (1988), 206 Cal. App. 3d 924, 930. The probate “petition” in that case claimed that the deceased settlor of a living trust was contractually obligated to leave half of her estate to specified persons. It sought a declaration that the trustee of the decedent’s revocable trust held half of the trust estate as a constructive trustee for the benefit of petitioners. The Superior Court sitting in probate dismissed the case on the grounds of lack of jurisdiction and the appellate court affirmed.

• Loud protests quickly followed Mullins, contending, in effect, that there is no such thing as a “probate court” in California and that it was therefore impossible for a department of the Superior Court to lack Superior Court jurisdiction. The CLRC promptly sponsored legislation amending Prob Code §17001. Stats 1990, ch 710, §44. The Law Revision Commission Comment for the amendment stated in part: “This amendment is needed to reject dicta in recent cases as to limitations on the power and jurisdiction of the court in proceedings properly commenced under this division. See Estate of Mullins.

• Then came Saks v. Damon Raike & Co. (1992), 7 Cal. App. 4th 419, an action filed in Superior Court by beneficiaries of a trust against an attorney for the trust and a real estate broker, arising out of the sale of real property owned by the trust and the purchase of other property. The trial Superior Court sustained defendants’ demurrers without leave to amend to plaintiffs’ second amended complaint and dismissed the action.

The Court of Appeal affirmed. The court held that because of the nature of their claims and the particular jurisdictional and procedural requirements of the law, the beneficiate lacked standing to bring their claims in the Superior Court. Under both the common law and the provisions of the Probate Code governing the administration of trusts (Prob. Code, §§16000 et seq., 17000 et seq.), the beneficiaries’ only proper course was to proceed against the trustee in the probate department of the Superior Court, seeking either to compel it to proceed against the attorney and the broker, or to remove the trustee and to appoint a trustee ad litem to sue the third parties. The court further held that Civil Code, §1559, providing that a contract made expressly for the benefit of a third person may be enforced by him or her at any time before the parties thereto rescind it, has no application to a case in which a trust has been created in favor of such third person.

Given the confusion arising out of these hybrid cases, some lawyers are still proponents of double filing and then consolidating cases involving both “probate” and “civil” matters. This will require extra filing fees, and the expense of making and appearing at the motion for consolidation. This requires extra filing fees, and can create waste confusion and the expense of making and appearing at the motion for consolidation. Nevertheless, the procedure does sometimes avoid problems with court personnel and can avoid claims that the court does not have jurisdiction to hear a particular cause of action. The procedure may also mean that issues pertaining to availability of jury trials and the availability of certain remedies (notably punitive damages) are treated as being dependent on the substantive cause of action pled and remedy demanded, rather than the room number of the particular department in which the case is heard.

If the double filing approach is not used, or counsel otherwise ends up defending a claim that a cause of action is filed in the “wrong” court or using the wrong procedure, other help is available. Code of Civil Procedure §396 provides that a case filed in a court without jurisdiction is to be transferred to a court having jurisdiction. Objections to use of a petition rather than a complaint or vice versa can be addressed by asking the court to treat the filed document as the other form of pleading. ”The nature of an action and the issues involved are to be determined, not from the appellation given the pleading, but from the facts alleged and the relief that they support.” Bloniarz v Roloson (1969) 70 C2d 143, 149; Estate of Linnick (1985), 171 Cal. App. 3d 752.

Whether the Superior Court is sitting in probate, or handling all civil matters, budget cutbacks have reduced court personnel, and the time and patience that can be devoted to processing cases. When your situation deserves the best counsel you can afford, contact the Boesch Law Group probate litigation lawyers for a consultation. Here at the Boesch Law Group, we have handled testamentary probate and trust disputes from the largest, most public and most complex in the nation (See Marshall v. Marshall for Anna Nicole Smith), to important matters for private people caught up in serious disputes and issues beyond their control.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

Jury Awards Six Billion Dollars in Punitive Damages Against Japan’s Largest Drugmaker

In one of the largest punitive damage awards in history – greater even than that awarded against Exxon Mobile Corp. for the Exxon Valdez Oil Spill – a Louisiana Federal Court jury awarded $6 billion in punitive damages against Takeda Pharmaceutical Co. Ltd., and $3 billion against Eli Lilly and Co., Takeda’s Indiana-based co-defendant. (In re: Actos Products Liability Litigation, Case No. 6:11-md-2299 (W.D. Louisiana))

After deliberating for less than two hours, the jury found that Takeda, Japan’s largest pharmaceutical company, had concealed cancer risks associated with its diabetes medication, Actos, and in addition to its punitive damages award, awarded the plaintiffs $1.475 million dollars in compensatory damages.

The Actos case consists of approximately 2,700 lawsuits that were consolidated into one multi-district litigation matter. The plaintiffs alleged that, prior to the drug’s release in 1999, executives at Takeda knew that Actos caused increased bladder cancer in laboratory animals, but withheld this information from regulators. When directed by the FDA to perform a post-marketing study on the safety and effectiveness of the drug, Takeda delayed the tests until 2003 and then designed them as a ten year trial. However, other interim studies showed a marked increase in bladder cancer among patients who took Actos. In 2011, Germany and France suspended use of the drug, and in the United States, the FDA issued a safety alert warning patients that taking the drug for more than a year could increase the risk of bladder cancer. Canada issued a similar warning in 2012. Nevertheless, Actos’ warning label still reads, “There are too few events of bladder cancer to establish causality.”

Following the jury’s verdict, Takeda’s general counsel stated that, “Takeda respectfully disagrees with the verdict and we intend to vigorously challenge this outcome through all available legal means, including possible post-trial motions and an appeal.” He went on to say that, “We also believe we demonstrated that Takeda acted responsibility with regard to Actos.”

While it is likely that the punitive damages award against Takeda will eventually be reduced , the message to drug manufacturers is clear. Pharmaceutical companies, as well as other product manufacturers, have a duty to ensure the safety of their products, and to warn of potential harms associated with them. When manufacturers fail to comply with their obligations to the general public, they may be found liable not only for compensatory damages, but for punitive damages as well.

Product liability cases present many challenges and should only be handled by attorneys who have experience in investigating, litigating, and obtaining justice for those harmed by negligent product manufacturers and distributors. The attorneys at the Boesch Law Group have successfully litigated hundreds of product liability cases, including against some of the largest product manufacturers in the world. For a free consultation with one of our Los Angeles-based products liability attorneys, call us today at (310) 578-7880.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

General Motors Seeks to Avoid Products Liability

General Motors has asked the Bankruptcy Court to confirm that it has immunity from products liability claims brought in a class-action lawsuit in California Federal Court.

General Motors (GM) went through a taxpayer-financed bankruptcy reorganization in 2009. The new GM that emerged from that process was offered immunity from product liability claims directed against the former GM entity. That immunity could potentially shield GM from responsibility in a San Francisco class action lawsuit, in which a group of owners of recalled GM cars from nine states are claiming that GM knew about its faulty ignition switch, and should compensate the owners for the reduction in car values arising from the defect. In addition to the class action suit, GM faces liability for thirteen deaths and thirty-two crashes throughout the United States as a result of the defective switch.

While GM has claimed bankruptcy protection from the beginning, some legal analysts believed that GM could not avoid liability if top officials knew about the potential for the class action products liability suit, but hid it from the bankruptcy court in 2009. GM claims that it only learned late last year that the ignition switches could be accidentally moved out of position, thereby disabling the air bags during a crash. The claimants argue, on the other hand, that GM knew it had a problem with the defective switches as early as 2001. Meanwhile, many GM dealerships still do not have the replacement parts, and Senator Richard Blumenthal (D-Conn) has pressured GM to provide “clear and accurate information” on when the new parts would be available to all dealers. Blumenthal has further called on GM to establish a victim’s compensation fund for those injured or whose family members were killed in crashes involving the recalled vehicles. He has also urged owners of the defective vehicles to refrain from driving them until they have been repaired.

The experienced products liability attorneys at the Boesch Law Group have assisted clients in obtaining compensation from major car companies for injuries sustained because of a product defect. If you or someone you know has been injured because of a manufacturing defect or a design defect – whether or not a recall has been issued – it is imperative that you speak with an attorney who has experience going up against the largest automobile manufacturers in the world. Call today for a free consultation with one of our preeminent Los Angeles-based products liability attorneys: (310) 578-7880.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

Michael Jackson’s Estate, Lloyd’s of London Settle Insurance Dispute Out of Court

michael-jackson

After three years of litigation between Lloyd’s of London, the insurers of Jackson’s “This Is It” tour, and Jackson’s estate, attorneys for the estate advised the court on January 15th  that they have settled with the insurer over a $17.5 million insurance policy. The case was scheduled to begin trial in February.

The terms of the settlement were not disclosed. Jackson estate attorney, said in a statement, “The estate and Lloyd’s of London are glad this matter got resolved.”

Lloyd’s had filed a lawsuit claiming it did not have to honor the policy it had issued to cover losses from the ill-fated “This Is It” tour, alleging it had been deceived because no one ever disclosed to the insurer that Jackson had a drug problem. On that basis, the insurer had asked the judge presiding over the case to nullify the policy.

Jackson died in 2009 from an overdose of propofol while preparing for his series of comeback concerts. The insurance policy was taken out to cover the cancellation or postponement of the London concerts in the case of the death, accident or illness of Jackson.

The possibility of the case heading to trial could have once again brought in testimony about Jackson’s private life and final days months after it was put on display in a wrongful death suit filed by Jackson’s family against the concerts’ promoter, AEG Live.

In 2011, the Boesch Law Group obtained a dismissal of star witness, Kenny Ortega as a defendant in the Michael Jackson wrongful death case. Then, in September 2013, a jury found in favor of defendant AEG Live, and against the Jackson plaintiffs in that portion of the wrongful death case that went to trial.

When asked what was the most important evidence in the case, said the jury foreman, “the testimony of Kenny Ortega,” Jackson’s friend, the director of “This Is It,” and the Boesch Law Group client who appeared twice as a witness before the jury.

As Entertainment Litigators, the Boesch Law Group employs a successful and extraordinary team approach to developing legal and business solutions for our clients. We are problem solvers and work closely with entertainment transactional attorneys, personal managers, and accountants. We specialize in litigation avoidance, and act as first responders to problems of all types that confront entertainment, media, and technology companies.

We handle a wide variety of legal matters in all areas of entertainment and interactive media for talent and production companies, for agencies and managers and their clients, from entrepreneurs through pre-production, post-production, distribution and creative negotiations and lawsuits. Our Entertainment Litigators’ negotiations explore creative paths to acquire, preserve, and exploit intellectual property, copyrights, ideas and creative work product, then protect and defend them on behalf of our clients.

We prosecute and defend cases for a select clientele of companies, actors, directors, producers, screenwriters, composers, recording artists, authors, publishers, producers, financiers, and distributors in all areas of the entertainment industry, from digital media to television, film, cable, music and literary publishing.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

The Developing Law on No Contest Clauses in Estate Litigation

Effective January 1, 2010 and applicable to all cases where the will or trust was executed after January 1, 2001, the California statutes governing No Contest Clauses have been repealed and re-written. For anyone considering challenging a will or trust that contains a No Contest Clause, it is of the utmost importance to understand the new laws pertaining to challenges and to seek the advice of legal counsel who is experienced in estate litigation.

Many estate documents contain a provision known as a No Contest Clause. This clause provides that, if any person challenges – or contests – the terms of the document, that person will be disinherited or otherwise removed as a beneficiary. These are serious consequences and should be carefully considered when deciding whether to proceed with estate litigation. Often, estate planners recommend providing for greatly reduced bequests to potential challengers to make sure they face the risk of a financial loss in the event of a contest.

Prior to 2010, the Probate Code differentiated between direct contests and indirect contests. Direct contests are challenges to a will or trust based on forgery; lack of due execution; lack of capacity; menace, duress, fraud, or undue influence; revocation; and/or disqualification of a beneficiary in a fiduciary relationship to the testator/trustor. Indirect contests challenged the validity of a will or trust on grounds other than those provided by statute. In 2010, the legislature did away with indirect contests, and changed the standard for direct contests from “reasonable cause” to “probable cause.” In enacting the new laws, the Law Review Commission stated that “because forfeiture is such a harsh penalty, it is disfavored as a matter of policy. Accordingly, a no contest clause should be applied conservatively, so as not to extend the scope of application beyond what was intended.”

The result is that a No Contest Clause will only be enforced against a “direct contest” that is brought without probable cause. Probable cause exists “if, at the time of filing a contest, the facts known to the contestant would cause a reasonable person to believe that there is a reasonable likelihood that the requested relief will be granted after an opportunity for further investigation or discovery.” (California Probate Code §21311(b)) In discussing the change in the standard from “reasonable” to “probable” cause, the Law Revision Commission stated that that, in order to avoid enforcement of a No Contest Clause, the contestant must not only have proof of his or her factual contentions but must also have a “legally sufficient ground for the requested relief.” There must be a “reasonable likelihood” that the requested relief will be granted, and that term has been interpreted to mean “more than merely possible, but less than ‘more probable than not.’”

They may also be enforced in the event of a challenge against a transfer of property on the grounds that it was not the transferor’s property at the time of transfer, or a contest against the filing of a creditor’s claim. (Cal. Probate C. §21311)

The other substantial change resulting from the new laws is the repeal of Probate Code §21320, which had allowed parties to request an advance ruling from the court to determine whether or not the no contest cause will be triggered by a proposed pleading.

If you are concerned that your loved one’s will or trust was a forgery, was subsequently revoked, was the result of fraud, duress, undue influence, or is otherwise invalid, it is imperative that you seek competent legal counsel to avoid unwittingly triggering a No Contest Clause. The Boesch Law Group regularly handles estate litigation involving No Contest Clauses and can advise you of your options. Please contact one of our Los Angeles-based attorneys today at (310) 578-7880.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

Will Seeking to Remove a Fiduciary Violate a No Contest Clause?

When a beneficiary of a trust is concerned that the trustee, or “fiduciary,” is breaching his or her fiduciary duty by failing to act in the beneficiary’s best interests or is otherwise abusing his position, the beneficiary can seek to have the fiduciary removed. However, the beneficiary may be concerned about triggering a No Contest Clause in the trust. No Contest Clauses generally provide that, if a beneficiary contests the terms of the trust, he or she will be disinherited or otherwise removed as a beneficiary. These are serious consequences and should be always carefully considered when taking any action to modify the terms of a trust.

Fortunately, the California Legislature has declared that any petition to remove a fiduciary will never constitute a “contest” so as to trigger the No Contest Clause – no matter what the trust document itself may state. (California Probate Code §21305) The courts have commented on the rule, stating, “a beneficiary should be able to question the actions of a faithless fiduciary without being subject to the restrictions of [a no contest] clause.” See Bradley v. Gilbert (2009) 172 Cal. App. 4th 1058. According to the Bradley Court, “a beneficiary who believes a fiduciary is engaged in misconduct should be able to bring the alleged misconduct to the court’s attention without fear of being disinherited.” Id. at 1071; see also, Estate of Ferber (1998) 66 Cal. App. 4th 244.

If you are a trust beneficiary and are concerned that the fiduciary trustee is breaching his or her duty, is improperly managing trust assets, or is otherwise acting improperly, you should seek the advice of an attorney who is experienced in trust disputes and estate litigation. The Boesch Law Group estate, trust, and probate litigation attorneys regularly represents trust beneficiaries and can provide you with the quality representation you deserve. For more information, please contact one of our Los Angeles-based estate attorneys today at (310) 578-7880.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

Duty to Disclose Dangerous Condition of Property Runs to Real Estate Agents

In Hall v. Aurora Loan Services, LLC (2013) 215 Cal.App 4th 1134, the California court of appeals recently held that real estate agents who are showing a property to prospective buyers, or their agents, have a duty to disclose dangerous conditions of which the seller’s agent has actual or constructive knowledge. In the above-stated matter, while being shown the property by the seller’s agent, the potential buyer’s agent was injured when she fell from an attic staircase. The buyer’s agent, the plaintiff, contended that she was injured due to a concealed dangerous condition of the property which was actually known or constructively known by the owner of the property and the listing agent because the dangerous condition had been previously disclosed to them pursuant to a property inspection report.

Noting that Civil Code Section 1714 provided that all people owe a duty of ordinary care to prevent injury to others, the appeals court found that a real estate agent for a property seller has a duty to notify any visitor to the subject property of any concealed dangerous condition of which the agent has knowledge or constructive knowledge. The appeals court further found that an agent’s actual or constructive knowledge is imputed to the property owner—an owner shares liability with an agent for damages proximately caused by the agent’s breach of duty.

Any real estate agent who knows (or should know) of a concealed dangerous condition on the property being shown, must inform any visitor, agent, or potential purchaser of that condition else the agent could be liable, along with the property owner, for any damages that are a result of the concealed condition.

The Boesch Law Group has a proven track record of success in real estate law and litigation matters. Should you have any questions, or need help with any real estate matter, please contact the Boesch Law Group for a free consultation.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

What Artist and Talent Managers Should Know About California’s Talent Agency Act: Part Two – Handling Disputes

In “What Artists and Talent Managers Should Know About California’s Talent Agency Act: Part One,” we discussed the differences between talent agents and managers and the ways that Talent Agency Act disputes can be avoided. Here we will discuss the potential results that come from a Talent Agency Act violation, as well as one exception to the act’s strict regulations.

Consequences of a Talent Agency Act Violation

If the Labor Commissioner or arbitrator finds that there has been a violation of the Talent Agency Act, he or she has three options. First, the decision-maker can completely void the parties’ contract. If the central purpose of the contract is found to be illegal, then the contract as a whole cannot be enforced. Voidance of the contract is not mandatory, but if the entire contract revolves around the solicitation and procurement of employment by the talent manager, then voidance is very likely. (Note that in many instances, even where the contract is voided, the arbitration clause – if there is one – requiring that the dispute be decided privately by an arbitrator, is not void and survives.)

If the contract merely contains an illegal provision, and the illegality is collateral to the main purpose of the contract, then the commissioner or arbitrator can order that the illegal provision be stricken from the contract. For example, in Marathon Entertainment, Inc. v. Rosa Blasi (2008) 42 Cal. 4th 974, in declining to void the parties’ contract, the court ruled that a personal manager who spends 99 percent of his time engaged in counseling a client and organizing the client’s affairs is not insulated from the act’s requirements if he spends one percent of his time procuring or soliciting; conversely, however, the 1 percent of the time he spends soliciting and procuring does not thereby render illegal the ninety-nine percent of the time spent in conduct that requires no license. See id. at 997. The court concluded, for the personal manager who truly acts as a personal manager, “an isolated instance of procurement does not automatically bar recovery for services that could lawfully be provided without a license.” Id. at 998.

Separately or in addition to voidance or severance, the commissioner can order the talent manager to disgorge the profits that he or she gained from the violation. In other words, if a talent manager solicits a television role for a client and accepts a ten percent commission on the amount the client makes per episode, he or she may be forced to return those commissions. As one can imagine, this can be disastrous to a talent manager who isn’t well-advised.

The “Safe Harbor Exception”

In 1982, the California Legislature amended the Talent Agency Act to impose a one-year statute of limitations, eliminate criminal sanctions for violations of the act, and establish a “safe harbor” for managers to procure employment if they do so in conjunction with a licensed talent agent. However, the exception has been interpreted very narrowly by the courts, and will “only apply if the unlicensed person is acting ‘in conjunction with and at the request of the licensed talent agency,’ and the only covered activity that such unlicensed person may engage in consists of ‘the negotiation of any employment contract.’” Massey v. Landis, TAC 42-03 (emphasis supplied). The safe harbor exception “does not extend to nor encompass activities which consist of approaching third parties and soliciting them to offer engagements to an artist.” Todd v. Meagher, TAC 13418.

Navigating the Talent Agency Act and responding to Talent Agency Act disputes requires the services of an experienced and knowledgeable attorney who is intimately familiar with entertainment law. The Boesch Law Group has extensive entertainment litigation experience, experience in advising clients how best to avoid Talent Agency Act disputes, and experience in dealing with such disputes as they arise – on behalf of managers, on behalf of talent, and as the decision-maker in a number of cases, including the leading case on the subject, Preston v. Ferrer (2008) 522 U.S. 340, where Mr. Boesch was retained by entertainment litigators on both sides of the dispute to arbitrate and decide the case. To speak to a Los Angeles-based attorney who can help guide you through the legal process, please call us today at (310) 578-7880 or email your inquiry.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

What Artist and Talent Managers Should Know About California’s Talent Agency Act: Part One – Avoiding Disputes

California law makes a significant distinction between talent managers and talent agents, oftentimes with dire consequences for those who, wittingly or unwittingly, blur the line between the two roles. California’s Talent Agency Act requires anyone who solicits or procures artistic employment or engagements for artists to obtain a talent agency license. Labor Code §1700.4, 1700.5. Talent managers who have “solicited” or “procured” work for their clients may find their contracts voided by the Labor Commissioner, and may even be required to return some or all of their earned payments.

“Artists” that fall under the act include, but are not limited to, actors and actresses, radio artists, musical artists, directors, producers, writers, cinematographers, composers, lyricists, arrangers, models, and “other artists and persons rendering professional services in motion picture, theatrical, radio, television and other entertainment enterprises.” See Labor Code §1700.4(b). “Other entertainment enterprises” may seem to be an extremely broad category.

A talent agent is “a person or corporation who engages in the occupation of procuring, offering, promising, or attempting to procure employment or engagements for an artist or artists.” Marathon Entertainment, Inc. v. Rosa Blasi (2008) 42 Cal. 4th 974, 983, 986, citing Labor Code §1700.4(a). “In Hollywood, talent agents act as intermediaries between the buyers and sellers of talent… Generally speaking, an agent’s focus is on the deal: on negotiating numerous short-term, project-specific engagements between buyers and sellers.” Id. at 983.

Talent managers, on the other hand, focus “on advising and counseling each artist with an eye to making the artist as marketable and attractive to talent buyers as possible, as well as managing the artist’s personal and professional life in a way that allows the artist to focus on creative productivity. ‘Personal managers primarily advise, counsel, direct, and coordinate the development of the artist’s career. They advise in both business and personal matters, frequently lend money to young artists, and serve as spokespersons for the artists.’” Id. at 984.

Frequently, however, it is expected that “the development of the artist’s career” involves introducing them to greater and better opportunities. Talent managers find themselves helping their clients by reaching out to their entertainment contacts in the industry about opportunities for their clients, exploring terms, negotiating contracts, and potentially engaging in activities for the benefit of their clients which entertainment litigators might one day claim are technical violations of the Talent Agency Act.

Many of the cases that find their way to the Labor Board involve an artist who, for one reason or another, no longer wants to pay his or her talent manager, and so complains that the manager has violated the Talent Agency Act. Any dispute involving the act must be first heard by the Labor Commissioner and cannot be brought in a court of law unless the commissioner has issued its ruling. It is not a forum friendly to the manager. According to a recent study by Forbes Magazine, ninety percent of the cases that have been referred to the Labor Commissioner in the last twenty years have been decided in favor of the artist. See “Walking on the California Talent Agency Act’s Thin Ice: Personal Managers Beware!”, by Richard Busch, Forbes March 25, 2013.

One way managers address what may seem to be an uneven playing field is to insert an arbitration clause in the management contract, requiring that any and all disputes be referred to arbitration. In the case of Preston v. Ferrer (2008) 522 U.S. 340, the United States Supreme Court upheld such an arbitration clause, even though by doing so it took away the Labor Board’s “exclusive jurisdiction.” Mr. Boesch of the Boesch Law Group was the arbitrator selected by the entertainment lawyers for both sides in the case, who upheld the arbitration clause and whose ruling was affirmed by the Supreme Court.

If you are a talent manager, talent agent, artist, or are otherwise involved in entertainment litigation and need to know more about the laws surrounding California’s Talent Agency Act, avoid disputes by speaking to a Los Angeles entertainment litigator who knows the rules and exceptions, who is respected by reputation, and who will fight to get you a fair and just result. To speak to a Los Angeles-based attorney who can help guide you through the legal process, please call us today at (310) 578-7880.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

Silicon Beach Fest 2016

SILICON BEACH FEST 2013Entrepreneurs, start-ups, content creators, social media mavens and masters of the digital world – mark your calendars!  Silicon Beach Fest returns August 23-27 in Los Angeles! Silicon Beach Fest is a biannual event celebrating LA’s flourishing digital media community. Spread over the course of four days, Silicon Beach Fest is an educational, creative and social community event to look forward to. Panelists include VCs, digital marketing strategists, entrepreneurs, and tech company CEO’s. A Digital Film Fest, workshops, and networking events populate the schedule.

With extensive and diverse expertise in entertainment disputes, digital media and contracts, the attorneys at the Boesch Law Group develop innovative and creative approaches to litigation, bringing to their clients, and to the Silicon Beach Fest, an in-depth understanding of the business and culture surrounding creative talent, pioneering business and technology.

Our entertainment litigation attorneys have won for plaintiffs and defendants numerous judgments and settlements in all areas of business and entertainment litigation. Located in the heart of Silicon Beach, our lawyers build business and assist business owners and general counsel with legal support, contracts and business advice. We position our clients to succeed in all aspects of a growing digital world. As entertainment litigators, we are problem-solvers who work closely with entertainment transactional lawyers, personal managers, talent agents, business managers, and accountants, in an extraordinary and successful team approach to the handling of entertainment lawsuits. The Boesch Law Group specializes in litigation avoidance, and act as first responders to problems of all types that confront entertainment, media and technology companies.

 

DISCLAIMER: The materials on this website are for general information purposes only and should not be construed as legal advice, legal opinion or any other advice on any specific facts or circumstances. Readers should not act or refrain from acting upon this information without seeking professional advice.

Transmission of information on or by use of this website is not intended to create, and receipt does not constitute, a lawyer-client relationship between the sender and receiver. Such communications will not be treated as confidential. Photographs and other graphics may be for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.


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