CA Appellate Court Certifies Class in Safeway Meal Break Case

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California Appellate Court Certifies Class Based on Employer’s Practice of Never Paying Premium Wages For Missed Meal Breaks

On Wednesday, the California Court of Appeal (Second District) upheld an order certifying a class of Safeway employees alleging violation of California’s unfair competition law (Bus. & Prof. Code, § 17200 et seq.) based on the theory that Safeway had a practice of never paying the premium wages required for missed meal breaks outlined in Labor Code § 226.7.

Alleging violations of the unfair completion law in conjunction with violations of the Labor Code is not itself a novel theory, and the Court of Appeal in this case had no trouble concluding “that a UCL claim may be predicated on a practice of not paying premium wages for missed, shortened, or delayed meal breaks attributable to the employer’s instructions or undue pressure, and unaccompanied by a suitable employee waiver or agreement.”

Under such a theory, even technical compliance with the Labor Code and California law with respect to meal breaks (e.g., providing employees with a reasonable opportunity to take full rest breaks, free from all work duties) may not be sufficient to avoid a class claim under the UCL if a plaintiff can sufficiently allege a practice of never paying premium wages when required.  Employers are advised to diligently review their practices and policies on a regular basis to ensure full compliance with all applicable laws and regulations and provide adequate protections against potential claims for meal and rest break violations.

The case is Safeway, Inc. v. Superior Court (Esparza), and the full opinion can be found here.

For more information contact:
David M. Prager, Esq.
Gibbs Giden Locher Turner Senet & Wittbrodt LLP
1880 Century Park East, 12th Floor
Los Angeles, California 90067
Phone: (310) 552-3400
email: dprager@gibbsgiden.com

The content contained herein is published online by Gibbs Giden Locher Turner Senet & Wittbrodt LLP (“Gibbs Giden”) for informational purposes only, may not reflect the most current legal developments, verdicts or settlements, and does not constitute legal advice. Do not act on the information contained herein without seeking the advice of licensed counsel.

Copyright 2015 Gibbs Giden Locher Turner Senet & Wittbrodt LLP ©

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Los Angeles County Supervisors: $15 Minimum Wage by 2020

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On Tuesday, the Los Angeles County Board of Supervisors voted to raise the minimum wage in unincorporated areas of Los Angeles County over the next five years.  The minimum wage is set to reach $15 per hour by 2020 for business with more than 26 employees.  For businesses with fewer than 26 employees, the wage increases will be delayed one year.

The minimum wage is set to incrementally increase over the next five years:  increasing to $10.50 on July 1, 2016; $12 on July 1, 2017; $13.25 on July 1, 2018; $14.25 on July 1, 2019; and $15.00 on July 1, 2020.   The increase for unincorporated areas mirrors the increase recently approved by the Los Angeles City Council in May and signed into law by Los Angeles Mayor Eric Garcetti on June 13.

The increase comes on the heels of minimum wage ordinances in various cities in California, including San Francisco and San Diego.

With the federal minimum wage set at $7.25 an hour, California’s statewide hourly minimum set at $9.00 (and increasing to $10.00 on January 1, 2016), and the patchwork of local ordinances governing minimum wages developing across the state, California employers must be diligent in complying with the myriad of minimum wage laws.

Read more about the minimum wage increase in Los Angeles County here.

For more information contact:
David M. Prager, Esq.
Gibbs Giden Locher Turner Senet & Wittbrodt LLP
1880 Century Park East, 12th Floor
Los Angeles, California 90067
Phone: (310) 552-3400
email: dprager@gibbsgiden.com

The content contained herein is published online by Gibbs Giden Locher Turner Senet & Wittbrodt LLP (“Gibbs Giden”) for informational purposes only, may not reflect the most current legal developments, verdicts or settlements, and does not constitute legal advice. Do not act on the information contained herein without seeking the advice of licensed counsel.

Copyright 2015 Gibbs Giden Locher Turner Senet & Wittbrodt LLP ©

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Online Advertising: Disclose, Disclose, Disclose

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If you or your business engage in online advertising (including through websites, blogs, mobile applications, Facebook, Twitter, Instagram and Tumblr), be sure you are familiar and comply with the Federal Trade Commission (FTC) disclosure guidelines commonly known as the “.com Disclosures

The FTC is stepping up enforcement actions that require businesses make clear and conspicuous disclosures, regardless of the platform, so as not to engage in “deceptive or unfair” advertising.  A couple of months ago, the FTC entered its Decision and Order in connection with its complaint against Amerifreight, Inc. for failing to properly disclose that it had paid consumers for online reviews. The action against Amerifreight came on the heels of the FTC’s action against Legacy Learning Systems for $250,000 in damages for a violation of blogger endorsement rules.

Similarly, Lock & Taylor may have recently violated the FTC’s disclosure guidelines when the retailer gave 50 bloggers a dress from its 2015 Design Lab fashion line and paid the bloggers an undisclosed amount of money to post a photo of themselves wearing the dress on Instagram with the hashtag #DesignLab.  While the advertising campaign was undoubtedly successful (the dress quickly sold out), none of the bloggers mentioned that they were paid by Lord & Taylor to post their photos on Instagram.

According to the FTC’s disclosure guidelines, “Bloggers receiving free products or other perks with the understanding that they’ll promote the advertiser’s products in their blogs [or social media accounts] would be covered [by the guidelines].” Such disclosures must be “accessible on all platforms used” and “clear and conspicuous.” The FTC suggests using “#Ad”, “Ad:” or “Sponsored” in tweets to be clear that a tweet or link within a tweet includes compensated content, and also placing clear disclosures near the beginning of your posts.

The FTC guidelines make it clear that when in doubt, it’s best to conspicuously disclose when a post or review is an ad or a sponsored message. Required disclosures “should not be relegated to ‘terms of use’ and similar contractual agreements” (i.e., Terms of Use, Privacy Policy, etc.) per the FTC Guidelines.

For a recent summary and expansion on the FTC’s .com Disclosures, see this article by Christine Buzan.   As the author points out, even though .com Disclosures are helpful and includes more than a dozen examples where disclosure may be required, its direction on how to comply (i.e., issues of disclosure size, placement and location) with the FTC’s guidelines are frustratingly vague– “There is no set formula for a clear and conspicuous disclosure; it depends on the information that must be provided and the nature of the advertisement.”

For more information contact:
Christopher E. Ng, Esq.
Gibbs Giden Locher Turner Senet & Wittbrodt LLP
1880 Century Park East, 12th Floor
Los Angeles, California 90067
Phone: (310) 552-3400
email: cng@gibbsgiden.com

twitter@bizlawprof360

The content contained herein is published online by Gibbs Giden Locher Turner Senet & Wittbrodt LLP (“Gibbs Giden”) for informational purposes only, may not reflect the most current legal developments, verdicts or settlements, and does not constitute legal advice. Do not act on the information contained herein without seeking the advice of licensed counsel.

Copyright 2015 Gibbs Giden Locher Turner Senet & Wittbrodt LLP ©

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YELP Asks a Federal Court for HELP!

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A Florida attorney’s wage and hour lawsuit against Yelp made its way this week to a federal court in the Northern District of California.  The potential class action allegation?  That Yelp’s failure to pay its employees proper wages amounts to a’21st century galley slave ship.’   Sounds both colorful and very serious.

What makes this employment case more interesting than most is that the plaintiff contends that the millions of consumers that post reviews on Yelp are the aforementioned slaves.  Specifically, the plaintiff claims that reviewers should be classified as employees and that failing to pay them for their feedback and content (without which Yelp “could not exist”) is actionable.

Although Yelp has been battling plaintiff’s claim for almost two years, Yelp filed a motion to dismiss which will likely be set for hearing by the federal court once a judge is assigned.   With 132 million monthly visitors and 57 million reviews, shockwaves will be sent through cyberspace if the court denies the motion and Yelp is faced with the reality that it may have suddenly hired millions of employees. No doubt lawyers for companies like Amazon, Angie’s List, TripAdvisor and eBay are watching this alleged “slave ship” closely.

For more about this case, check out the article at therecorder.com here:http://www.therecorder.com/id=1202727067078/Yelp-Stuck-Battling-Reviewer-Suit

For more information contact:
Christopher E. Ng, Esq.
Gibbs Giden Locher Turner Senet & Wittbrodt LLP
1880 Century Park East, 12th Floor
Los Angeles, California 90067
Phone: (310) 552-3400
email: cng@gibbsgiden.com

twitter@bizlawprof360

The content contained herein is published online by Gibbs Giden Locher Turner Senet & Wittbrodt LLP (“Gibbs Giden”) for informational purposes only, may not reflect the most current legal developments, verdicts or settlements, and does not constitute legal advice. Do not act on the information contained herein without seeking the advice of licensed counsel.

Copyright 2015 Gibbs Giden Locher Turner Senet & Wittbrodt LLP ©

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$1.4 Billion Not Enough to Establish General Jurisdiction

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In Daimler AG v. Bauman (2014) 134 S. Ct. 746, the United States Supreme Court rewrote civil procedure textbooks around the country. In last year’s momentous decision, the Supreme Court held that “the place of incorporation and principal place of business are paradig[m]…bases for general jurisdiction,” and that only in “exceptional cases” should a court exercise general jurisdiction over a corporation domiciled in another state.

Just weeks ago, a California appellate court was asked to review a trial court decision finding the existence of general jurisdiction over BNSF Railway Company in a wrongful death action. Specifically, the family of a former BNSF employee filed suit in a Los Angeles Superior Court last year, alleging that the decedent’s death from mesothelioma was the result of his having worked with asbestos at a facility located in Wichita, Kansas. BNSF, incorporated in Delaware with its principal place of business in Texas, filed a motion to quash arguing that the California court lacked jurisdiction because the lawsuit did not arise from any of BNSF’s California activities (i.e., no specific jurisdiction) and because its activities within the State of California were a “minor” component of its overall operation. BNSF claimed that only six percent of its sales revenue came from California, and a similarly small percentage of its infrastructure and workforce are located in California, whereas the largest share of its workforce, sales, and infrastructure came from BNSF’s home state of Texas.

A Los Angeles County Superior Court judge denied BNSF‘s motion to quash. CitingDaimler, the court said that general jurisdiction was present because BNSF has a “continuous and systematic” relationship with California that made the company “essentially at home” here.

The Court of Appeal, however, reversed the trial court decision, reiterating that while a defendant may be sued in a state where it is neither incorporated nor headquartered, it requires an “exceptional case.” Also relying on Daimler, the Court asserted that although California was an important market for BNSF’s products, its activities in California were comparatively small compared to its national business. The uniqueness of asbestos litigation “does not make every asbestos suit ‘exceptional,’” said the Court. Although sympathetic to the plight of the plaintiff, the Court opined that allowing the plaintiff to sue BNSF either where it was incorporated or where its principal place of business was located, preserves the constitutional rights of of both parties. To permit BNSF to be sued in a multitude of states would violate the due process rights of BNSF for the reasons set forth in Daimler:

[T]he due process rights of defendants cannot vary with the types of injury alleged by plaintiffs.  Our analysis must focus on ‘the relationship among the defendant, the forum, and the litigation’…and that relationship here is simply not enough to render petitioner ‘at home’ in California such that the exercise of general jurisdiction over actions unrelated to petitioner’s forum activities is warranted.”

Despite the fact that $1.4 billion in revenue generated in California seems to be an “exceptional” drop in the bucket, it is clear Daimler and appellate cases like BNSF are establishing a high threshold for the “exceptional case.”  National and global companies like BNSF have reason to celebrate. To read the appellate opinion, click here.

The content contained herein is published online by Gibbs Giden Locher Turner Senet & Wittbrodt LLP (“Gibbs Giden”) for informational purposes only, may not reflect the most current legal developments, verdicts or settlements, and does not constitute legal advice. Do not act on the information contained herein without seeking the advice of licensed counsel.

For more information contact:
Christopher E. Ng, Esq.
Gibbs Giden Locher Turner Senet & Wittbrodt LLP
1880 Century Park East, 12th Floor
Los Angeles, California 90067
Phone: (310) 552-3400
email: cng@gibbsgiden.com

Copyright 2015 Gibbs Giden Locher Turner Senet & Wittbrodt LLP ©

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Are You Using Updated Notary Acknowledgment and Jurat Forms?

Although many businesses have updated their forms to reflect the new Notary language required for Certificates of Acknowledgment and Jurats, we still see many obsolete forms floating around.  Documents with outdated Notary Acknowledgments or Jurats are being rejected by County Recorder offices throughout the State of California.

For those of you not already aware, the California Legislature recently passed a law to make it clear that the Notary’s seal and signature do not authenticate or endorse the contents of a document.  The purpose of the law was to make sure that consumers unfamiliar with a Notary’s duties would not be more inclined to trust a fraudulent document simply because it was notarized.

The law, effective January 1, 2015, requires the following new language to appear word-for-word at the top of the notary certificate in a box:

“A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.”

If you haven’t already done so, it is important to update all of your forms that require a Notary Acknowledgment, Jurat or Proof of Execution Certificate.  Links to updated  PDF forms can be found below:

Notary Acknowledgment (Effective January 1, 2015):

http://notary.cdn.sos.ca.gov/forms/notary-ack.pdf

Jurat (Effective January 1, 2015)

http://notary.cdn.sos.ca.gov/forms/notary-jurat.pdf

For more information contact:
Christopher E. Ng, Esq.
Gibbs Giden Locher Turner Senet & Wittbrodt LLP
1880 Century Park East, 12th Floor
Los Angeles, California 90067
Phone: (310) 552-3400
email: cng@gibbsgiden.com

The content contained herein is for informational purposes only, may not reflect the most current legal developments and does not constitute legal advice. The transmission of information in this post (or any transmission or exchange of information over the Internet), or by any of the included links, is not intended to create and does not constitute an attorney-client relationship. The opinions expressed in this post are the opinions of the author only and may not reflect the opinions of the author’s law firm. No representations are made as to the completeness, accuracy or validity of any information contained in this post.

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Copyright 2015 Gibbs Giden ©

When an E-Mail Signature is an Electronic Signature is a Settlement Signature

An e-mail signature can be a thoughtful closing to a mundane correspondence, or a mindless addendum to an otherwise critical message. Some are automatically placed at the foot of every message we send, while others are customized for a particular recipient. Does an e-mail signature constitute a legally binding signature? And if so, is this e-mail signature sufficient to bind parties to a settlement agreement?
The California State Court of Appeal addressed the issue of when an e-mail signature amounts to an electronic signature, and when an electronic signature is sufficient to enforce a settlement agreement in J.B.B. Investment Partners, Ltd., et al., v. R. Thomas Fair, et al. No. A140232, 2014 WL 6852097 (Cal. Ct. App. Dec. 5, 2014). The case concerned a series of e-mails and text messages, a voicemail, a round of golf, and a week-long communication delay – a perfect recipe for a dispute concerning when, how and where a contract was made. Ultimately, the Court found that merely signing one’s name at the bottom of an e-mail is far from sufficient to bind that person in contract, let alone to a settlement agreement. Under California’s Uniform Electronic Transactions Act (“UETA”), the party looking to enforce the e-mail as an electronic signature must show that 1) the parties agreed to conduct an electronic transaction and 2) the signing party wrote his or her name on the email with the intent to formalize an electronic transaction.

Background

This case involved a dispute between two real estate investors on the one hand, and the owner of two apartment units on the other. After Plaintiffs had invested $250,000 in Defendant Hand’s apartments, they allegedly discovered several fraudulent misstatements and omissions made by the Defendant. Before commencing the litigation, the parties engaged in settlement discussions, and on July 4, 2013, Plaintiffs’ counsel sent Hand an e-mail (“July 4 Offer”) laying out the terms of the proposed $350,000 settlement, included in which were the following statements:

• “All litigation would be stayed pending full payments”
• “The Settlement paperwork would be drafted in parallel with your full disclosure of all documents and all information…”
• We require a YES or NO on this proposal; you need to say I ACCEPT … Anything less shifts all focus to the litigation and to the Court Orders we will seek…”
• “Let me know your decision.”

The July 4 Offer did not contain a signature line or signature block, nor was the e-mail signed by any of the Plaintiffs.

The following day, Fair responded to the offer with a seemingly ambiguous e-mail from his cell phone (“July 5 Response”) at 10:17 a.m., which read:
“[Plaintiffs’ counsel], the facts will not in any way support the theory in your e-mail. I believe in [the apartment complex]. So I agree. Tom fair[.]”

Counsel for the Plaintiffs responded soon thereafter, asking Hand to clarify his response. Before receiving such response, Plaintiffs filed the instant lawsuit, which complaint was then sent to Defendant at 12:25 p.m. During the next two hours, Fair sent three text messages and left one voicemail, in which he apologized for being on a golf course that prohibited cell phone use, reiterating his acceptance of the terms presented in the July 4 Offer. At 1:53, Plaintiffs’ counsel sent a confirmatory e-mail acknowledging receipt of Fair’s acceptance, and noting that “I will work on the formal settlement paperwork” and “will seek to get that settlement paperwork to you for review by Monday.”

On July 11, 2013, the written settlement agreement, complete with signature blocks for all parties and a clause explicitly permitting the document to be electronically signed, was sent to Defendant. Defendant did not sign that written settlement offer, and the parties proceeded to trial. Upon a motion to enforce the settlement agreement pursuant to California Code of Civil Procedure § 664.6, the trial court ruled that the central issue was whether the two parties had a meeting of the minds as to the terms of the settlement, and that the July 4 Offer was accepted by Fair’s July 5 Response. This conclusion was supported by the court’s interpretation of the surrounding circumstances and communications. The trial court entered judgment for the Plaintiffs and Defendants timely appealed.

Discussion

On appeal, the Court found that, as a preliminary matter, in order to determine whether the settlement agreement could be enforced under CCP § 664.6, there must first be a determination of whether the settlement was signed as required by the statute. Where the alleged signature is electronic in form, party seeking enforcement of the signature must show that A) the parties agree to conduct a transaction by electronic means pursuant to UETA § 1633.5(b), and that B)it amounts to an electronic signature under UETA §1633.2(h). Neither of these conditions was address by the trial court, yet they were determinative on appeal.

A) Parties agree to conduct electronic transaction

The question of whether the parties agreed to conduct a transaction by electronic means is determined by examining the context and surrounding circumstances of the transaction. While an explicit agreement to allow electronic signatures is not required, it is a relevant factor. Furthermore, evidence that a signature was requested or permitted in electronic form in past or future agreements will be relevant.

Here, there was no signature requested in the July 4 Offer, nor did the offer invite a signature with a signature block. Instead, the offer merely requested a “YES,” “NO,” or “I ACCEPT” in return. Furthermore, the July 11 written proposal included signature blocks, as well as explicit language permitting electronic signatures. And Plaintiffs’ counsel wrote a follow-up e-mail on July 19 to Fair stating, “It’s a good thing we have a settlement, then; let’s put pen to paper and close it…We are not going to stay anything until we have a signed deal.” All these communications would indicate that both parties agreed that any settlement would only be enforceable as a written, signed document.

B) Electronic Signature

In order to fulfill the requirement of § 1633.2(h), a party must show more than merely proof that the signature in question was made by the person against whom enforcement of the contract is sought, and that the signature was electronic. The party must also show that the signature was “executed or adopted by a person with the intent to sign the electronic record.” Id. Furthermore, the court may value evidence of whether both sides intended for a document or signature to be binding as an electronic signature.

Here, the Court found that there was substantial evidence to support Defendant’s argument that Fair did not intend for his signature to formalize an electronic transaction. First, Defendant’s July 5 voicemail and text messages did not indicate that he intended his prior e-mail signature to act as a binding legal signature, but merely that he agreed with the negotiated terms. Second, the July 4 Offer indicated that further paperwork would be prepared, which paperwork would serve as the final settlement agreement. Third, Plaintiffs’ July 5 filing of this instant complaint – which by the terms of the July 4 Offer would seem to terminate the offer prior to acceptance – and subsequent drafting a written settlement agreement negate any argument that the Plaintiff believed the July 5 Response to be a binding signature.

Conclusion

The rules governing electronic transactions and signatures under the UETA are well established and informative: it must be clear that both parties agreed to conduct an electronic transaction, and that the signing party intends for that electronic signature to act as a binding signature. However, the J.B.B. Court seemed to add even heightened scrutiny to this analysis when a part seeks to enforce a settlement agreement with an electronic signature. Agreements of such legal import and consequence should be unequivocal in their terms, and the parties forthright in their intent.

For more information contact:
Sumner D. Widdoes, Esq.
Gibbs Giden Locher Turner Senet & Wittbrodt LLP
1880 Century Park East, 12th Floor
Los Angeles, California 90067
Phone: (310) 552-3400
email: swiddoes@gibbsgiden.com

The content contained herein is for informational purposes only, may not reflect the most current legal developments and does not constitute legal advice. The transmission of information in this post (or any transmission or exchange of information over the Internet), or by any of the included links, is not intended to create and does not constitute an attorney-client relationship. The opinions expressed in this post are the opinions of the author only and may not reflect the opinions of the author’s law firm. No representations are made as to the completeness, accuracy or validity of any information contained in this post.

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Copyright 2014 Gibbs Giden ©