Recent Wins: Kent L. Richland
In a published opinion, the Second District Court of Appeal, Division 4 reversed a $1.7 million judgment against GMSR’s client J-M Manufacturing Co., Inc.
January 29, 2016
In a unanimous published opinion reversing the $1.7 million judgment against GMSR’s client J-M Manufacturing Co., Inc., the Second District Court of Appeal, Division 4, held in Sheppard, Mullin v. J-M Manufacturing (2d Civ. No. B256314) that when a client engages an attorney for representation, a broad, non-specific waiver of all present and future conflicts of interest in the engagement agreement is not valid—only a fully-informed waiver is effective. The Court also held because such a purported waiver is contrary to California public policy as embodied in the California Rules of Professional Conduct, an arbitration award that refuses to invalidate the waiver cannot be enforced in court and must be vacated.
Read the Court's published opinion here.
GMSR wins publicity rights dispute for Bing Crosby’s heirs; Court of Appeal’s decision helps delineate publicity rights of celebrities and their heirs, brings stability to settlements by reaffirming the breadth of releases of claims
January 28, 2014
Bing Crosby v. HLC Properties, Ltd. (2014) 223 Cal.App.4th 597 (California Court of Appeal, Second Appellate District, Division Three) [published]. In an important decision for the entertainment industry, the Court of Appeal resolved a publicity rights dispute in favor of GMSR’s clients, famous crooner Bing Crosby’s second family. The decision also has more widespread ramifications, as it brings stability to settlements by reaffirming the effectiveness of broad releases of claims.
Crosby’s two families settled internecine disputes over the division and distribution of “interest, dividends, royalties and other income derived from the community property of” Bing and his first wife in 1996; the agreement did not specifically address Bing’s statutory right of publicity. Although the settlement included broad release language that encompassed unknown and unsuspected claims, nonetheless, in 2010, the descendants of the first wife sued Bing’s widow and the family management company asserting that the global settlement did not encompass Bing’s statutory right of publicity. They contended that although the “deceased personality” publicity statute (Civil Code section 3344.1) was on the books in 1996 it did not apply to Bing prior to an amendment in 2008, so that his publicity right was nonexistent until then and fell outside the settlement. The superior court agreed, but the Court of Appeal reversed, holding that the 2008 amendment was a mere clarification of existing law and that, accordingly, the publicity right existed in 1996 and the settlement agreement encompassed a waiver of any interest the first family might have had in that right.
More about the case here.
Bing Crosby v. HLC Properties, Ltd. (2014) 223 Cal.App.4th 597
GMSR obtains $66 million reduction of judgment and reversal of alter ego determination
June 27, 2013
Corona Summit v. SPUS05 Corona Summit (2013) 2013 Cal.App. Unpub. LEXIS 4633 (California Court of Appeal, Second Appellate District, Division Four) [unpublished]. GMSR’s client, CB Richard Ellis Strategic Partners US Opportunity 5 LP (Fund V), had formed a single purpose entity (SPE) to purchase office buildings. The SPE deposited $13 million as security for its performance—its entire net worth. When the 2008 recession hit, the value of the property plummeted, and the SPE elected not to purchase. Although the purchase agreement contained a liquidated damages clause stating that retention of the $13 million security deposit was the seller’s “sole and exclusive remedy” in the event of buyer breach, the trial court held that the clause was trumped by a “specific performance” provision in a contemporaneous contract and, when the SPE failed to perform, entered a $79 million award. Adding insult to injury, the trial court also found that GMSR’s client was the SPE’s alter ego and therefore liable for the entire judgment. GMSR persuaded the Court of Appeal that, as a matter of law, the liquidated damages clause limited the seller’s damages to the $13 million deposit, resulting in a reversal of the judgment of specific performance. This included a reduction of the $79 million damages award to $13 million, the amount for which the client conceded it would be liable if the court found a breach. The court also reversed the alter ego determination and a very substantial attorney fee award.
More about the case here.
Corona Summit v. SPUS05 Corona Summit (2013) 2013 Cal.App. Unpub. LEXIS 4633
Court of Appeal adopts GMSR’s interpretation of Court’s earlier decision in favor of GMSR's client
February 22, 2012
Bioquest Venture Leasing Co. v. VivoRx Autoimmune, Inc. (2012) 2012 Cal.App. Unpub. LEXIS 1293 (California Court of Appeal, Second Appellate District, Division Seven) [unpublished]. This is GMSR’s second appellate victory in this case. In the first appeal, GMSR successfully argued for the reversal of a $2.5 million judgment on the basis of a statute of limitations defense. However, each side read the court of appeal's disposition of the case differently, and moved for entry of judgment in its favor. Bioquest argued a theory regarding the accrual date of the statute of limitations that it had not argued in the original trial or in its prior appellate briefing---a theory that it claimed entitled it to collect the entire original judgment. GMSR’s clients argued, inter alia, that the appellate court intended the trial court to enter judgment for them and, in any event, that Bioquest could not raise its new theory at this late stage. The trial court adopted the arguments advanced by GMSR's clients. Bioquest appealed. On the second appeal, the Court of Appeal held that the trial court had correctly interpreted the court’s prior decision regarding the limited scope of remand and that Bioquest had forfeited its newly-minted theory. The Court of Appeal also affirmed an award of attorneys' fees for GMSR's clients.
Bioquest Venture Leasing Co. v. VivoRx Autoimmune, Inc. (2012) 2012 Cal.App. Unpub. LEXIS 1293
GMSR achieves substantial reduction in damages in STD transmission case
March 8, 2011
A jury found that GMSR’s client transmitted herpes to the plaintiff, and it awarded $6,753,000 in compensatory and punitive damages. The compensatory damages included $2,500,000 for future medical expenses. On appeal, GMSR demonstrated that there was no substantial evidence of future medical expenses beyond the cost of Valtrex, a drug shown to control the symptoms of herpes that cost $200 per month, or about $72,000 for the plaintiff’s life expectancy. The Court of Appeal agreed, and reduced the award for future medical costs to that amount.
US Supreme Court unanimously rules in favor of GMSR's clients in workplace privacy case
June 17, 2010
City of Ontario v. Quon (2010), __U.S.___, 130 S.Ct. 2619, 177 L.Ed.2d 216 (United States Supreme Court). For the third time in four years, the Supreme Court of the United States has issued a unanimous ruling in favor of GMSR. In City of Ontario v. Quon, U.S. Sup. Ct. No. 08-1332, the Court ruled that the Ontario Police Department’s review of text messages sent and received by a SWAT team officer on his department-issued pager did not violate the Fourth Amendment’s prohibition of unreasonable searches and seizures. This is the first case in more than two decades in which the Court has considered how the Fourth Amendment applies in a government workplace. GMSR lawyers Kent Richland (who argued the case in April 2010) and Kent Bullard represented the Department, the City of Ontario, and the Chief of Police. GMSR previously achieved unanimous victories for its clients in Marshall v. Marshall, 547 U.S. 293 (2006) and Van de Kamp v. Goldstein, 555 U.S. ___ (2009).
City of Ontario v. Quon (2010) __U.S.___, 130 S.Ct. 2619, 177 L.Ed.2d 216
Court of Appeal reverses multi-million dollar judgment against GMSR clients on ground that California, not Massachusetts law, determines the applicable statute of limitations
November 5, 2009
Bioquest Venture Leasing Company-A, N.V. v. VivoRx Autoimmune, Inc. (2009) 2009 Cal.App. Unpub. LEXIS 8833 (California Court of Appeal, Second Appellate District, Division Seven) [unpublished]. Plaintiff sued GMSR's client VivoRx for breach of a biotechnology license agreement that was silent on choice of law. VivoRx argued that California law applied, and that it barred plaintiff's claims as untimely, while plaintiff insisted that Massachusetts law governed the lawsuit, and that its claims were timely under Massachusetts' longer statute of limitations. The trial court applied Massachusetts law, and entered a multi-million dollar judgment against VivoRx. The Court of Appeal reversed the judgment, adopting GMSR's arguments on two grounds. First, that plaintiff's contract with VivoRx did not incorporate by reference an earlier agreement between plaintiff and a third party that contained a Massachusetts choice of law clause, even though VivoRx had agreed to assume all of the third party's obligations under that earlier agreement. And second, that under both governmental interest analysis and Civil Code section 1646, it was California's shorter statutes of limitations that determined the timeliness of plaintiff's claims.
Bioquest Venture Leasing Company-A, N.V. v. VivoRx Autoimmune, Inc. (2009) 2009 Cal.App. Unpub. LEXIS 8833
Court of Appeal reverses $30 million malpractice and breach of fiduciary duty judgment
February 20, 2009
Blanks v. Seyfarth Shaw LLP (2009) 171 Cal.App.4th 336 (California Court of Appeal, Second Appellate District, Division Three). In a suit charging attorney malpractice and related intentional torts, a celebrity plaintiff claimed that GMSR’s client, a major law firm, had deprived him of an automatic $10 million recovery from his former business manager/agent under the Talent Agencies Act. The jury awarded the plaintiff over $30 million, including $15 million punitive damages. In a published decision, the Court of Appeal reversed the judgment in its entirety and remanded the case for retrial, finding prejudicial instructional and other errors and with specific directions for the trial court to consider a potentially dispositive defense it had previously rejected.
Blanks v. Seyfarth Shaw LLP (2009) 171 Cal.App.4th 336
Court of Appeal reverses defense judgment in artist royalty case
May 16, 2008
HLC Properties v. MCA Records (2008) 2008 Cal.App. Unpub. LEXIS 3993 (California Court of Appeal, Second Appellate District, Division Five) [unpublished]. GMSR’s clients, the heirs of legendary performer Bing Crosby, sued MCA Records for unpaid royalties. Because it concluded that the claims were equitable in nature, the trial court held a bench trial, the result of which was a complete defense verdict. GMSR challenged the judgment on the basis that the Crosby heirs had been denied their constitutional right to a jury trial of claims that were actually contractual at nature. The Court of Appeal agreed and reversed, ordering a new trial for GMSR’s clients.
HLC Properties v. MCA Records (2008) 2008 Cal.App. Unpub. LEXIS 3993
Court of Appeal reverses judgment in first impression workers’ compensation exclusivity case and a second appeal regarding attorneys' fees
December 6, 2007
Perrillo v. Picco & Presley (2007) 157 Cal.App.4th 914 (California Second District Court of Appeal, Division One). [published]. In 1996, several individuals filed both workers’ compensation claims against their employer and a related civil suit against a third party for injuries allegedly sustained through toxic contamination of their workplace. They hired a physician to serve as an expert, agreeing that he would hold both workers’ compensation liens and a lien on any recovery in the civil case. The expert submitted his reports to the Workers’ Compensation Appeals Board and received payment on some of the workers’ compensation cases. When the workers’ attorneys informed the expert that workers’ compensation was his exclusive remedy, the expert withdrew his pending workers’ compensation liens and insisted on being paid from the civil settlement. Ultimately, the expert sued the workers’ attorneys for breach of the civil lien contracts, claiming that workers’ compensation was not his exclusive remedy because he was hired for the civil case. The trial court agreed. Representing the workers’ attorneys on appeal, GMSR attorneys Kent Richland and Jeffrey Raskin and former GMSR attorney Laura Boudreau argued, as a matter of first impression, that workers’ compensation is an expert’s exclusive remedy for medical-legal services that overlap workers’ compensation and civil cases, and that the expert’s civil liens were therefore unenforceable.
Perrillo v. Picco & Presley (2007) 2007 Cal.App. Unpub. LEXIS 9860 (California Second District Court of Appeal, Division One). [unpublished]. In a separate but related appeal regarding the portions of the judgment everyone agreed survived workers' compensation exclusivity, GMSR attorneys argued that the expert was not entitled to the more than half million dollars in attorneys' fees awarded by the trial court, while the expert's attorneys sought even greater fees. The Court of Appeal reversed the judgment on both counts, authoring a published decision eliminating all damages for workers' compensation-related services and an unpublished decision eliminating all attorneys' fees.
In case of first impression, Court of Appeal construes “health care providers” in MICRA statute to apply to optometry intern
July 20, 2007
Chosak v. Alameda County Medical Center (2007) 153 Cal.App.4th 549 (California Court of Appeal, First District, Division One) [published]. Plaintiff had sued an optometry intern for injuries to her foot during an eye examination, alleging that the intern improperly operated the examination chair. GMSR’s hospital client demurred on the ground that the action was time-barred under Code of Civil Procedure section 340.5, which governs actions for medical negligence against health care providers. Plaintiff argued that the intern was not a “health care provider” within the meaning of the statute, because she was not licensed to practice optometry pursuant to any of the licensing provisions set forth in section 340.5. The trial court rejected this position, and the court of appeal affirmed that decision, holding in a case of first impression that a medical student who is expressly exempt from the licensing requirements and, therefore, legally practicing without a license, is a “health care provider” for purposes of the MICRA statute of limitations provisions. While agreeing with the plaintiff that the statute could be strictly read to include only “licensed” professionals, the court ultimately sided with the position advocated by GMSR lawyers Carolyn Oill and Kent Richland that to exclude exempt providers from the coverage of MICRA “would work at cross-purposes to the Legislature’s objective” in enacting the MICRA statutes, which was to reduce insurance premiums for health care providers.
Attorney disqualification order reversed in first-impression case
September 20, 2006
Fremont Indemnity Co. v. Fremont General Corp. (2006) 143 Cal.App.4th 50 (California Court of Appeal, Second District, Division Three (Los Angeles)) [published]. Marc Poster and Kent Richland secured this victory. The Court of Appeal held that the trial court had erred in disqualifying GMSR's client law firm from representing Fremont General in an action brought by the Insurance Commissioner on behalf of Fremont General's former subsidiary, Fremont Indemnity, now in liquidation. Deciding an issue of first impression, the Court concluded that the client law firm's simultaneous representation of Fremont General and Fremont Indemnity in unrelated actions while those two entities were adverse in a third unrelated action did not constitute a conflict of interest requiring disqualification.