Los Angeles Lawyer June 2010 June2010 Issuemaster.Qxp 5/13/10 12:26 PM Page 5

June2010_IssueMaster.qxp 5/13/10 12:25 PM Page c1

2010 Lawyer-to-Lawyer Referral Guide

June 2010 /$4

EARN MCLE CREDIT PLUS Protecting Divorce Web Site Look and Estate and Feel Planning page 40 page 34

Limitations of Privacy Rights page 12 Revoking Family Trusts page 16

The Lilly Ledbetter Fair Pay Act Strength of page 21 Character Los Angeles lawyers Michael D. Schwartz and Phillip R. Maltin explain the effective use of character evidence in civil trials page 26 June2010_IssueMaster.qxp 5/13/10 12:42 PM Page c2

Every Legal Issue. One Legal Source. June2010_IssueMaster.qxp 5/13/10 12:25 PM Page 1

Interim Dean Scott Howe and former Dean John Eastman at the Top 100 celebration.

CHAPMAN UNIVERSITY SCHOOL OF LAW

PROUDLY ANNOUNCES OUR RANKING AMONG THE TOP 100

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FEATURES 26 Strength of Character BY MICHAEL D. SCHWARTZ AND PHILLIP R. MALTIN Stringent rules for the admission of character evidence in civil trials are designed to prevent jurors from deciding a case on the basis of which party is more likeable 34 Parting of the Ways BY HOWARD S. KLEIN Estate planning issues need to be evaluated during every stage of a marital dissolution 40 Screen Grabbing BY KEVIN D. HUGHES AND DAVID E. ROSEN Although proving infringement of a Web site’s look and feel is difficult, claims under trade dress law may prove more fruitful than those under copyright law Plus: Earn MCLE credit. MCLE Test No. 193 appears on page 43.

47 Special Section 2010 Lawyer-to-Lawyer Referral Guide

Los Angeles Lawyer DEPARTMENTS the magazine of the Los Angeles County 10 Barristers Tips 60 Closing Argument Bar Association Performance of due diligence in Healthcare reform should not follow transactions MICRA’s example June 2010 BY ALISON M. PEAR BY HEATHER E. STERN Volume 33, No.4 12 Practice Tips 57 Classiﬁeds COVER PHOTO: TOM KELLER The diminishing power of California’s rights of privacy and publicity 58 Index to Advertisers BY ZAC LOCKE 59 CLE Preview 16 Practice Tips Revocation of a family trust without the knowledge of the cotrustee LOS ANGELES LAWYER (ISSN 0162-2900) is published monthly, BY KIRA MASTELLER except for a combined issue in July/August, by the Los Angeles County Bar Association, 1055 West 7th Street, Suite 2700, Los Angeles, CA 90017 (213) 896-6503. Periodicals postage paid at Los Angeles, CA and additional mailing offices. Annual sub- 21 Practice Tips scription price of $14 included in the Association membership Determining the reach of the Lilly dues. Nonmember subscriptions: $28 annually; single copy price: $4 plus handling. Address changes must be submitted Ledbetter Fair Pay Act six weeks in advance of next issue date. POSTMASTER: Address Service Requested. Send address changes to Los Angeles BY HERNALDO J. BALTODANO AND DAVID MARTINEZ Lawyer, P. O. Box 55020, Los Angeles CA 90055. 06.10 June2010_IssueMaster.qxp 5/13/10 12:26 PM Page 4

VISIT US ON THE INTERNET AT www.lacba.org/lalawyer E-MAIL CAN BE SENT TO [email protected] EDITORIAL BOARD Chair DAVID A. SCHNIDER Articles Coordinator MICHAEL A. GEIBELSON

JERROLD ABELES (PAST CHAIR) DANIEL L. ALEXANDER ETHEL W. BENNETT CAROLINE BUSSIN CYNDIE M. CHANG R. J. COMER (PAST CHAIR) CHAD C. COOMBS (PAST CHAIR) ELIZABETH L. CROOKE ANGELA J. DAVIS (PAST CHAIR) PANKIT J. DOSHI GORDON ENG There is no substitute for experience. HELENE J. FARBER STUART R. FRAENKEL ■ Daily Journal Top Neutral 2008 & 2009 TED HANDEL JEFFREY A. HARTWICK ■ Over 1,400 successful mediations STEVEN HECHT (PAST CHAIR) ■ 16 years as a full-time mediator NAFISÉ NINA T. HODJAT LAWRENCE J. IMEL ■ Director, Pepperdine’s “Mediating the Litigated GREGORY JONES Case” program 2002-2009 MARY E. KELLY JOHN P. LECRONE THANAYI LINDSEY KAREN LUONG LEE JAY BERMAN, Mediator PAUL MARKS AMY MESSIGIAN 213.383.0438 www.LeeJayBerman.com MICHELLE MICHAELS ELIZABETH MUNISOGLU RICHARD H. NAKAMURA JR. (PAST CHAIR) CARMELA PAGAY DENNIS PEREZ ADAM J. POST GARY RASKIN (PAST CHAIR) JACQUELINE M. REAL-SALAS (PAST CHAIR) HEATHER STERN KENNETH W. SWENSON BRUCE TEPPER R. JOSEPH TROJAN THOMAS H. VIDAL JEFFREY D. WOLF KOREN WONG-ERVIN STAFF Publisher and Editor SAMUEL LIPSMAN Senior Editor LAUREN MILICOV Senior Editor ERIC HOWARD Art Director LES SECHLER Director of Design and Production PATRICE HUGHES Advertising Director LINDA LONERO BEKAS Account Executive MERYL WEITZ Sales and Marketing Coordinator AARON J. ESTRADA Advertising Coordinator WILMA TRACY NADEAU Administrative Coordinator MATTY JALLOW BABY Copyright © 2010 by the Los Angeles County Bar Association. All rights reserved. Reproduction in whole or in part without permission is prohibited. Printed by R. R. Donnelley, Liberty, MO. Member Business Publications Audit of Circulation (BPA). The opinions and positions stated in signed material are those of the authors and not by the fact of publication necessarily those of the Association or its members. All manuscripts are carefully considered by the Editorial Board. Letters to the editor are subject to editing.

4 Los Angeles Lawyer June 2010 June2010_IssueMaster.qxp 5/13/10 12:26 PM Page 5

Could you benefit from a wealth specialist who understands the legal landscape? Our Legal Specialty Group is dedicated to advising law firms, partners and associates.

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LOS ANGELES LAWYER IS THE OFFICIAL PUBLICATION OF THE LOS ANGELES COUNTY BAR ASSOCIATION 1055 West 7th Street, Suite 2700, Los Angeles CA 90017-2548 Judge Michael D. Marcus (Ret.) Telephone 213.627.2727 / www.lacba.org Mediator Arbitrator Discovery Referee ASSOCIATION OFFICERS President EXPERIENCED PERSUASIVE EFFECTIVE DON MIKE ANTHONY President-Elect Daily Journal Top 50 Neutral 2009 ALAN K. STEINBRECHER Senior Vice President Daily Journal Top 40 Neutral 2007 ERIC A. WEBBER Vice President • Employment • Legal Malpractice RICHARD J. BURDGE JR. • Business • Real Property Treasurer LINDA L. CURTIS • Personal Injury • Intellectual Property Assistant Vice President PATRICIA EGAN DAEHNKE Century City Downtown Los Angeles Orange County Assistant Vice President tel: 310.201.0010 www.marcusmediation.com Available exclusively at TANJA L. DARROW email: [email protected] Assistant Vice President IRA M. FRIEDMAN Assistant Vice President MARGARET P. STEVENS Immediate Past President DANETTE E. MEYERS Executive Director SALLY SUCHIL Associate Executive Director/Chief Financial Officer BRUCE BERRA Associate Executive Director/General Counsel W. CLARK BROWN BOARD OF TRUSTEES P. PATRICK ASHOURI , CFF GEORGE F. BIRD JR. [email protected] CHRISTOPHER C. CHANEY KIMBERLY H. CLANCY DUNCAN W. CRABTREE-IRELAND ANDREW DHADWAL ANTHONY PAUL DIAZ BEATRIZ D. DIERINGER DANA M. DOUGLAS WILLIAM J. GLUCKSMAN JAMES I. HAM JACQUELINE J. HARDING ANGELA S. HASKINS BRIAN D. HUBEN TAMILA C. JENSEN PAUL R. KIESEL RICHARD A. LEWIS HON. RICHARD C. NEAL (RET.) ELLEN A. PANSKY ANN I. PARK THOMAS H. PETERS American of DAVID K. REINERT MARIA M. ROHAIDY Institute Mediation ALEC S. ROSE JOHN K. RUBINER NANCY A. SHAW World Class Training for the Complete Mediator DAVID W. SWIFT LUCY VARPETIAN NORMA J. WILLIAMS BUILDING A PROFITABLE MEDIATION/COLLABORATIVE PRACTICE ROBIN L. YEAGER with Forrest (Woody) Mosten AFFILIATED BAR ASSOCIATIONS BEVERLY HILLS BAR ASSOCIATION Friday-Saturday • June 4-5 BLACK WOMEN LAWYERS ASSOCIATION OF LOS ANGELES, INC. CENTURY CITY BAR ASSOCIATION CONSUMER ATTORNEYS ASSOCIATION OF LOS ANGELES MEDIATING & NEGOTIATING COMMERCIAL CASES CULVER-MARINA BAR ASSOCIATION EASTERN BAR ASSOCIATION OF LOS ANGELES COUNTY with Lee Jay Berman GLENDALE BAR ASSOCIATION Wednesday-Sunday • June 9-13 IRANIAN AMERICAN LAWYERS ASSOCIATION ITALIAN AMERICAN LAWYERS ASSOCIATION Meets the 40-hour Court Requirement - 30 MCLE Hours JAPANESE AMERICAN BAR ASSOCIATION OF GREATER LOS ANGELES JOHN M. LANGSTON BAR ASSOCIATION JUVENILE COURTS BAR ASSOCIATION MEDIATING DIVORCE AGREEMENT KOREAN AMERICAN BAR ASSOCIATION OF SOUTHERN CALIFORNIA LAWYERS' CLUB OF LOS ANGELES COUNTY with Jim Melamed LESBIAN AND GAY LAWYERS ASSOCIATION OF LOS ANGELES LONG BEACH BAR ASSOCIATION Wednesday-Sunday • July 21-25 MEXICAN AMERICAN BAR ASSOCIATION Meets the 40-hour Court Requirement - 30 MCLE Hours PASADENA BAR ASSOCIATION SAN FERNANDO VALLEY BAR ASSOCIATION SAN GABRIEL VALLEY BAR ASSOCIATION SANTA CLARITA BAR ASSOCIATION See our complete listing of courses and dates at: SANTA MONICA BAR ASSOCIATION SOUTH ASIAN BAR ASSOCIATION OF SOUTHERN CALIFORNIA www.AmericanInstituteofMediation.com SOUTH BAY BAR ASSOCIATION OF LOS ANGELES COUNTY, INC. SOUTHEAST DISTRICT BAR ASSOCIATION 213.383.0454 SOUTHERN CALIFORNIA CHINESE LAWYERS ASSOCIATION WHITTIER BAR ASSOCIATION WOMEN LAWYERS ASSOCIATION OF LOS ANGELES

6 Los Angeles Lawyer June 2010 June2010_IssueMaster.qxp 5/13/10 12:27 PM Page 7 June2010_IssueMaster.qxp 5/13/10 12:27 PM Page 8

JUDGE LAWRENCE W. CRISPO (RET.)

have a dirty little secret. Before I joined the Los Angeles Lawyer Editorial Board, I never really read the magazine. I At the time, I thought a year or two on the board would be a good way to get a few friends published and might add some polish to my resume. Of course, to edit articles, I had

to read some first to see what the magazine was all about. Once I began paying attention to the content of the magazine, I found articles on a regular basis that I actually wanted to read. It was not long before an issue came up in practice that I realized had been covered by Los Angeles Lawyer. Half the research I needed was available in an organized presentation right there in the magazine’s pages. I suspect that those of you bothering to read this From the Chair column already know what I learned—that Los Angeles Lawyer is an incredible resource. One of the goals of the magazine’s Editorial Board is to develop and publish a significant Mediator Arbitrator breadth of content. Our guiding principle is that every subscriber should be able to find at least one article of interest in every issue. Being based in a large metropolis gives us an advantage, because we can draw from a diverse pool of lawyers and practices. As a result, we are able to cover a wide variety of subjects every year. Referee 213.926.6665 Thanks to the hard work of lawyers from our community who volunteer for the www.judgecrispo.com Editorial Board, this magazine not only achieves breadth but also depth. Every article is reviewed first by a lawyer to ensure that the analysis is not superficial and contains salient details that will have value to the readers. When an article addresses an area in which I practice, it is such a high-quality resource that I will save it to a file and refer back to it when giving legal advice. I am not alone in this practice. Los Angeles Lawyer is one of the few bar publications that is actually referred to in published court opinions. The magazine provides a unique venue for members of our legal community to garner exposure for their expertise. Its online archives are a rich store of legal analysis and an excellent first step for any legal research. Its special issues bring attention to topics of particular concern to Southern Californians. Despite those remarkable qualities, Los Angeles Lawyer carries out its mission during trying times for all publications. Newspapers have shrunk as the Internet has eaten into their profits. Scores of magazines have folded or moved solely to online distribution. People’s attitudes and interests are changing. Soccer is even becoming a popular sport in this country! Yet this magazine remains one of the most popular benefits of County Bar membership. The articles we publish every month are an unparalleled resource that con- tinues to provide value to lawyers in their daily practices. I am honored to have been given the opportunity to chair the Editorial Board, whose members work diligently to regularly present practical, cutting-edge articles for our readers. This month’s issue is my last as chair of the Editorial Board. I am thankful for the very small part I have been able to play in helping the bar leadership, the staff of the magazine, the volunteers on our Editorial Board, and, most importantly, the authors who produced this past year’s articles. Next month, Michael Geibelson will take over as the new chair of the Editorial Board. I have known Michael for a number of years and can attest that he will be a very capable and dynamic leader. I wish him luck and look forward to seeing what articles the coming bar year has in store for us. ■

David A. Schnider is general counsel for Leg Avenue, Inc., a distributor of costumes and apparel. He is the 2009-10 chair of the Los Angeles Lawyer Editorial Board.

8 Los Angeles Lawyer June 2010 June2010_IssueMaster.qxp 5/13/10 12:27 PM Page 9

JACK TRIMARCO & ASSOCIATES www.jacktrimarco.com

A proud member of the Los Angeles County Bar Association June2010_IssueMaster.qxp 5/13/10 12:32 PM Page 10

barristers tips BY ALISON M. PEAR

Performance of Due Diligence in Transactions

DUE DILIGENCE IS A PHASE OF EVERY TRANSACTION, from a bank determine how the submitted disclosures relate to the purposes of dili- loan to a corporate merger. It is how the parties determine if and how gence in the particular transaction, if at all. Legal diligence can gen- they should proceed. The process typically involves reviewing a com- erally be described as serving three purposes. pany’s documents and in some instances visiting a company’s facili- First, diligence helps identify what needs to be done. Lawyers need ties or interviewing employees. to inform clients what actions must be taken before the transaction Perhaps because it is time-consuming, due diligence is often unap- can be completed. A common hurdle involves change-in-control pro- preciated, but wrongfully so—no one wants to purchase a company visions in material contracts. If a company is about to undergo a only to discover that it is in substantial debt or about to be sued by merger, its contracts need to be examined for a provision that a a former employee with several well-documented reasons to be dis- merger will be considered a breach of contract. If an important con- gruntled. Despite the critical role of due diligence, it is not always well tract forbids the company from entering into a merger, consent from understood, especially by new associates, who often are the ones assigned primary responsibility. It is therefore crucial that a transac- Despite the critical role of due diligence, it is not always tional attorney understand the purpose of diligence and how it relates to the particular deal. Due diligence generally falls into two over- well understood, especially by new associates, who often lapping categories: business and legal. Business diligence focuses on a company’s financial situation, operations, and prospects. This is often are the ones assigned primary responsibility. handled by the involved businesses themselves or their financial advisers rather than their legal representatives. Diligence should be a cooperative process. It should be undertaken the contract party must be obtained. Other examples include the need by the reviewed entity’s own counsel as well as the counsel for the other for shareholder consent to the transaction or government approval side. Both sides have the same goal of getting the transaction com- to transfer a license. pleted, and they need to work together in order to address any issues Second, lawyers need to know what must be disclosed in a trans- that may come to light. Unfortunately, many companies and their coun- action. Most agreements contain representations and warranties— sel become defensive when subject to due diligence review. statements in which the party represents that certain facts are true. Generally, diligence begins with delivery of a due diligence check- For example, a company will need to represent that it has been duly list, which requests the documents and information that the attorney organized and that it has the power to enter into the proposed trans- needs to review. Diligence lists, modified as appropriate for the transaction. It also may represent that it is in compliance with all relevant action at hand, will often request documents showing corporate environmental laws and has paid its taxes. A company that makes a organization, management, capitalization, financial statements, tax false representation may be in breach of the transactional agree- information, regulatory licensing, intellectual property, employees, and ments and could be subject to future liability. However, if any prob- material contracts. lems with disclosures are identified before the completion of the Diligence requests usually involve several rounds of back and forth transaction, the parties can work together to modify the representa- with requests for additional documentation and clarification as the tions to disclose the pertinent facts and avoid the breach. reviewing party becomes more familiar with the subject company. Third, lawyers need to identify legal issues that may affect a For example, if initial diligence reveals that there are a number of client’s business decisions and advise the client regarding potential res- regulatory licenses involved in a business, that will be an area of focus, olutions to these issues. For example, if diligence reveals an exclusive and more documentation may be required. In other instances, the dis- license agreement that would conflict with the client’s current or closed documentation may be incomplete. For example, an amend- future business plans, the client should be made aware of this issue ment to but not the original agreement may be provided in response and what the options may be. to a request, so another request needs to be sent asking for the Keeping these purposes in mind will help the reviewer focus on original. Other lines of inquiry may be appropriately abandoned. For what is important in the transaction and process the plethora of infor- example, a company may respond to a set of document requests about mation received into something useful that will guide how the trans- real property ownership by indicating it does not own any real action may proceed. ■ property. In most scenarios, diligence requests will result in the disclosure Alison M. Pear is a transactional attorney specializing in securities and merg- of significant amounts of documentation, and the reviewer must ers and acquisitions at TroyGould PC in Century City.

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practice tips BY ZAC LOCKE

The Diminishing Power of California’s Rights of Privacy and Publicity

PAMELA ANDERSON AND CHRISTIAN BALE have at least one thing name or likeness—with the additional requirements of a knowing use in common: they are celebrities whose private moments were recorded and, for commercial uses, a direct connection between use and purpose. and disseminated to the public. Anderson recorded a sex tape for private use, which was later widely distributed to the public without her Most Common Defense consent. Bale made a furious, profanity-laden, and threatening rant The most common defense asserted against claims for right of pub- during filming of Terminator Salvation when the film’s director of pho- licity and invasion of privacy is the “newsworthiness” defense, also tography, Shane Hurlbut, walked across Bale’s sight line during a called the “public affairs” or “public interest” defense.10 This defense scene.1 Soon thereafter, an audio recording of the rant was available is based upon the First Amendment and “the public interest in the dis- on the Internet for everyone to hear.2 semination of news and information consistent with the democratic Unauthorized disseminations of recordings may lead to a lawsuit, processes under the constitutional guaranties of freedom of speech and like the one filed by Anderson,3 or a public apology, such as Bale’s.4 California has a specific statute—Civil Code Section 3344—and existing common law purporting to protect To fall within the newsworthiness exception, the information privacy rights as well as the name, image, voice, likeness, and signature of individuals from unauthorized use. Nevertheless, recent does not have to be “news” in the strict sense of the word. court decisions have curtailed the application of the statute and common law significantly, especially when defendants invoke competing First Amendment of the press.”11 rights. As a result, celebrities and noncelebrities alike are limited in To fall within the newsworthiness exception, the information their efforts to prohibit the unauthorized dissemination of video, pho- does not have to be “news” in the strict sense of the word; indeed, tographs, or audio recordings of their personal lives. “entertainment features receive the same constitutional protection as The two most common causes of action against distributors of factual news reports.”12 Nor does the information require presenta- unauthorized recorded material involve asserting the right of publicity tion in a not-for-profit context to receive First Amendment protec- and protection from invasion of privacy. In rare instances, when tion.13 However, if the use is commercial in nature, a claim can be plaintiffs filing suit to protect their rights are also the creators of the stated under Section 3344 if the nonconsensual use is “directly con- recording at issue, the claims include copyright infringement. nected with the commercial sponsorship.”14 California recognizes both a common law and a statutory right of Courts have held that newsworthy matters encompass almost publicity. U.S. Second Circuit Judge Jerome Frank coined the term “right anything, including “the accomplishments, everyday lives, and roman- of publicity” in 1953 when he found that a claim for invasion of pri- tic involvements of famous people.”15 The only limitations are vacy was not sufficient to cover individuals requiring an exclusive right “‘[w]here the publicity is so offensive as to constitute a morbid and to exploit their likenesses to maintain their economic value.5 California sensational prying into private lives for its own sake,’”16 or when courts proceeded to adopt protections for rights of publicity,6 with the defamatory statements are published “either with knowledge of their California Legislature providing statutory protection in 1971. Civil falsity or with reckless disregard for the truth.”17 These limitations, Code Section 3344 states the elements of a claim as 1) a knowing use however, provide little protection, as it is almost impossible for a plain- 2) of someone’s “name, voice, signature, photograph, or likeness, in tiff to prove that the unwilling dissemination of truthful personal infor- any manner, on or in products, merchandise, goods or services” 3) with- mation meets either standard. out consent, and 4) with resulting injury.7 According to the statute, Pamela Anderson’s case, among others, illustrates how a First the use of a likeness in a commercial medium does not automatically Amendment defense is difficult to overcome. In Michaels v. Internet require consent. Instead, a commercial use gives rise to a question of Entertainment Group, Bret Michaels and Anderson claimed that fact whether the use “was so directly connected with the commercial Internet Entertainment Group (IEG), which distributed a sex tape sponsorship” that it required consent.8 recorded by the two plaintiffs, violated their rights of publicity and Invasion of privacy generally comprises four separate torts: “(1) intru- privacy.18 They also asserted claims against the television program sion upon the plaintiff’s seclusion or solitude, or into his private affairs; Hard Copy and its affiliate companies for reporting that IEG planned (2) public disclosure of embarrassing private facts about the plaintiff; (3) publicity which places the plaintiff in a false light in the public eye; Zac Locke is an attorney in Beverly Hills, where he represents talent, producers, and (4) appropriation, for the defendant’s advantage, of the plaintiff’s and companies in film, music, and other entertainment-related transac- name or likeness.”9 Civil Code Section 3344 is the statutory comple- tions. He thanks Duke Law School graduate Risa Weaver and attorney Natalie ment to the fourth category of invasion of privacy—appropriation of Locke for their assistance with this article.

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to release the videotape on the Internet on a protected, even though the footage was used value. This gives the complaining individual, specific date and for showing excerpts from the not only without the plaintiff’s permission but especially a public one, a steep hill to climb tape on the program. Regarding Anderson’s also over his stated objections.25 The court to prove intrusion into private affairs. right of publicity claim, the court granted the based its decision on the rationale that surf- Even people other than Tiger Woods, with motion for summary judgment filed by Hard ing, as “a lifestyle that has become world- low profiles and high golf handicaps, still Copy and its affiliate companies that was famous and celebrated in popular culture,” may not be protected from wide public dis- based on a First Amendment defense of news- was a newsworthy subject of public interest. tribution of recordings of their private lives. worthiness. According to the court, the report The court also held that the famous surfer In Daly v. Viacom, Inc., the court expressly of the tape’s distribution fit within the scope who had given the interview could not assert held that noncelebrities are treated no dif- of information that is given “to the public for a claim for right of publicity because public ferently than celebrities in the adjudication of purposes of education, amusement or enlight- interest attaches to “people who by their claims for misappropriation of name and enment” and thus was newsworthy.19 The accomplishments or mode of living create a likeness.29 The case also extends the protec- court also ruled that the distribution was not bona fide attention to their activities,” and the tion against misappropriation claims far “commercial sponsorship.” plaintiff had attained that status.26 beyond factual reports to “any expressive In its holding, the Michaels court focused work, whether factual or fictional.”30 on an important nuance to the commercial Expansion of Public Interest In Daly, a relatively unknown female real- sponsorship analysis of the right of publicity. The effect of this case is significant. Although ity TV participant was recorded on video kiss- Previous California decisions provided that if producers of television news and documen- ing a man in the bathroom of a nightclub. a commercial use was connected with com- tary programs usually procure general That recording was played on the show Bands mercial sponsorship, consent of the featured releases from anyone even remotely appear- on the Run and used in advertisements to pro- individual was required.20 However, the court ing in any footage taken during the prepa- mote the program. The plaintiff asserted claims found that Anderson’s consent was not nec- ration of the programs, that practice may be for right of publicity and invasion of privacy essary because no facts were submitted to sug- unnecessary to avoid liability. According to against the show and its corporate parent. In gest that Hard Copy attempted to use its report the Dora holding, if the subject of the pro- ruling on the right of publicity claim, the court to advertise the tape. Although Hard Copy was duction is a matter of public interest, even held that the First Amendment extended to any a commercial endeavor—and its report on the the unauthorized use of the individual’s entertainment program as an “expressive tape, which included the likenesses of Anderson name and likeness will not be actionable. work.”31 Moreover, the court’s analysis of the and Michaels, was intended to attract viewers Further, Michaels and Dora underscore that commercial sponsorship issue took it a step fur- and advertisers—the court held that the “com- California courts are providing an expansive ther by holding that the use of the plaintiff’s mercial purpose of promoting the news outlet definition of “public interest.” Thus it is likeness in promotions of the show was an does not preclude the newsworthiness privi- questionable whether producers must con- adjunct to the protected use itself and, thus, lege.”21 Thus the promotion of Hard Copy was tinue to follow their usual practice of obtain- permitted. The court reasoned that a restric- incidental to the reporting of the news story. ing releases for the use of a person’s name, tion on the use of a likeness in advertisements Similarly, the First Amendment news- image, or likeness in a documentary or news- would restrict the public’s access to the per- worthiness defense barred Anderson’s claim related audiovisual work. mitted speech. Since the permitted speech car- that Hard Copy invaded her privacy by dis- Dora has further implications for film- ried more weight than a person’s right to pro- closing private facts about her. The court makers who desire to dramatize the life of a tect his or her likeness, the advertisement for made this ruling after considering three fac- historic figure, whether famous or not. The the permitted speech also outweighed the tors: “(1) the social value of the facts pub- common practice of filmmakers seeking to asserted personal protections.32 lished; (2) whether the plaintiff voluntarily create these biographical dramas or biopics Thus, the Daly court determined that a became involved in public life; and (3) is to attempt to acquire the rights to the sto- party may use a person’s likeness without whether a substantial relationship or nexus ries either firsthand from the person or estate consent in an advertisement for an expressive exist[ed] between the matters published and or from a secondary source. However, this can work, provided the advertisement does not matters of legitimate public concern.”22 take years and may not bear fruit. Under falsely claim that the person endorses the Although the social value of a report about current California law, acquiring these rights program. Although the court did not elabo- a sex tape may have been limited, the court may not matter since filmmakers may rely on rate on the issue, apparently it believed that found that summary judgment should be the newsworthiness exception.27 While the the public would not think the plaintiff— granted because Michaels and Anderson were best protection for producers remains the recorded in a bathroom stall kissing a bud- voluntary public figures, and the report of dis- acquisition of rights before commencing their ding rock star—endorsed the show. tribution of the tape and the dispute sur- projects, Dora’s application of the news- In ruling on the invasion of privacy claim, rounding its distribution “bore a substantial worthiness protection suggests that in many the court held that because the plaintiff pre- nexus to a matter of public interest.”23 The cases, unauthorized biopics on topics of pub- viously had disclosed publicly that she had court also held that because images of lic interest may survive claims that they vio- kissed the rock star, she did not have a privacy Anderson engaged in sex were already widely late the right of publicity or constitute inva- right regarding a similar event. In addition, available, Hard Copy’s use of brief images of sion of privacy under California law. the court noted that the event in the bathroom Anderson during its report were less intrusive. Dora is also important for its almost cir- stall did not “become[] a private fact merely Another court came to a similar decision cular definition of “social value” as that term by virtue of the location in which such activ- in Dora v. Frontline Video,24 a less scan- applies to invasion of privacy. The court held ity occurs.”33 dalous case that involved the use of a person’s that because surfing was a topic of public This assertion by the Daly court, if applied name and likeness in a surfing documentary. interest, it automatically had social value.28 broadly, may have shocking consequences. In Dora, the California Court of Appeal ruled Because public interest comprises anything in For example, an act performed by non- that use of footage of the plaintiff surfing which the public is interested (unless fantas- celebrities, in private, potentially can become and the use of an audio interview he had tically morbid or offensive), anything in which appropriated for advertising for entertain- given in a documentary was constitutionally the public has interest therefore has social ment purposes irrespective of the person’s

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intentions or desires. A kiss in a restaurant, 3 See, e.g., Michaels v. Internet Entm’t Group, 48 U.S.P.Q. – EXPERT WITNESS – an argument in a backyard, or even extracur- 2d 1891 (C.D. Cal. 1998) (the Pamela Anderson/ ricular activities in a bedroom without shades Bret Michaels sex tape case); Lee v. Internet Entm’t CONSTRUCTION Group, 33 Fed. Appx. 886 (9th Cir. 2002) (the Pamela drawn all appear to be fair game for the Anderson Lee/Tommy Lee sex tape case). 41 YEARS media to use broadly and disseminate widely. 4 See, e.g., Christian Bale’s Apology, http://www.popsugar CONSTRUCTION EXPERIENCE Given the burden of proof that plaintiffs .com/2782685 (last visited Jan. 11, 2010). must meet in California, apparently little 5 Haelan Labs., Inc. v. Topps Chewing Gum, Inc., 202 remains of the rights of privacy and publicity. F. 2d 866 (2d Cir. 1953) (“[M]any prominent persons SPECIALTIES: (especially actors and ball-players), far from having One exception is when the sole use of a per- Lawsuit Preparation/Residential their feelings bruised through public exposure of their Construction, Single and Multi-family, son’s image or likeness is to advertise a com- likenesses, would feel sorely deprived if they no longer Hillside Construction, Foundations, mercial product without any related First received money for authorizing advertisements….”). Vibration Trespass, Concrete, Floors, Tile, Amendment rights. For example, in Downing 6 The elements of a common law right to publicity Stone, Retaining Walls, Waterproofing, v. Abercrombie & Fitch, the defendant used claim are “(1) the defendant’s use of the plaintiff’s Water Damages, Roofing, Sheet Metal, identity; (2) the appropriation of plaintiff’s name or like- Carpentry/Rough Framing, Stairs, photos of the plaintiffs, former professional ness to defendant’s advantage, commercial or otherwise; Materials/Costs, Building Codes, surfers, in one of its quarterly catalogs that (3) lack of consent; and (4) resulting injury.” Michaels, Construction Contracts. used a surfing theme to advertise its clothing. 48 U.S.P.Q. 2d at 1894 (quoting Eastwood v. Superior CIVIL EXPERIENCE: The surfers never gave their permission to Court (Nat’l Enquirer), 149 Cal. App. 3d 409 (1983)). Construction defect cases for insurance 34 7 CIV. CODE §3344(a). appear in the catalog. Although surfing had companies and attorneys since 1992 8 CIV. CODE §3344(e). previously been adjudicated as a matter within 9 Eastwood, 149 Cal. App. 3d 409 (citing Lugosi v. 35 the public interest, the Downing court noted Universal Pictures, 25 Cal. 3d 813 (1979)). the “tenuous relationship between Appellants’ 10 See, e.g., Downing v. Abercrombie & Fitch, 265 F. 3d COOK photograph and the theme presented” and 994, 1001 (2001); Daly v. Viacom, Inc., 238 F. Supp. CONSTRUCTION COMPANY determined that “Abercrombie used Appel- 2d 1118, 1122 (N.D. Cal. 2002); Michaels, 48 U.S.P.Q. STEPHEN M. COOK lants’ photograph essentially as window-dress- 2d at 1895; Gionfriddo v. Major League Baseball, 94 Cal. California Contractors License B431852 App. 4th 400, 409 (2001); Dora v. Frontline Video, Inc., Nevada Contractors License B0070588 ing to advance the catalog’s surf-theme.”36 15 Cal. App. 4th 536, 542-43 (1993). Graduate study in Construction Because the use of the photo did not “con- 11 Gionfriddo, 94 Cal. App. 4th at 409. L.A. Business College, 1972 tribute significantly to a matter of the public 12 Id. at 410. interest,” Abercrombie could not assert a 13 Id. at 411. “Profit, alone, does not render expression Tel: 818-438-4535 Fax: 818-595-0028 First Amendment defense to appropriation.37 ‘commercial’….The term ‘commercial speech’ has a spe- Email: [email protected] cial meaning in the context of the First Amendment. The court held that the photograph was used [T]he core notion of commercial speech is that it does 7131 Owensmouth Avenue, Canoga Park, CA 91303 in an advertisement without any connection no more than propose a commercial transaction.” Id. to First Amendment speech. Based upon cur- at 411-12 (quoting Hoffman v. Capital Cities/ABC, Inc., rent California law, only purely commercial 225 F. 3d 1180, 1184 (9th Cir. 2001)). use falls outside the First Amendment excep- 14 CIV. CODE §3344(e). 15 Michaels, 48 U.S.P.Q. 2d at 1897. tion to the rights of privacy and publicity. 16 Id. (quoting Diaz v. Oakland Tribune, Inc., 139 Although California provides for statutory Cal. App. 3d 118, 126 (1983)). and common law rights and remedies for the 17 Eastwood v. Superior Court (Nat’l Enquirer), 149 unauthorized appropriation of a person’s Cal. App. 3d 409, 424 (1983) (citing New York Times name or likeness, the defense of newswor- Co. v. Sullivan, 376 U.S. 254, 279-80 (1964)). 18 thiness or public interest, grounded in the Michaels, 48 U.S.P.Q. 2d at 1893. Michaels did obtain a “temporary restraining order prohibiting IEG First Amendment, is broad enough to encom- from marketing or distributing the Tape.” Id. The pass almost any truthful use. If a person, case made reference to deals only with IEG’s codefen- even a noncelebrity, performs an act in a dants and their motion for summary judgment. A Team Of Experts public place and that act is filmed, pho- 19 Id. at 1895. 20 At Your Service... tographed, or captured with any technology See, e.g., Midler v. Ford Motor Co., 849 F. 2d 460, 463 (9th Cir. 1988). and later disseminated, the person has little 21 Michaels, 48 U.S.P.Q. 2d at 1896. ______recourse against the distributors. 22 Id. at 1898. Most uses of the material, however dis- 23 Id. Realtors® with experience in seminated, likely will be classified as speech 24 Dora v. Frontline Video, Inc., 15 Cal. App. 4th 536 Divorce within the public interest and protectable by (1993). 25 Id. at 538. the First Amendment. In addition, the use of Trust 26 Id. at 540. Probate the person’s name or likeness in advertising is 27 Id. permitted as long as it is truthful and not 28 Id. at 541. ______solely used for commercial exploitation of a 29 Daly v. Viacom, Inc., 238 F. Supp. 2d 1118, 1123 product. In 2010 and beyond, a successful (N.D. Cal. 2002). 30 Id. Providing complimentary assertion of the rights of publicity and pri- 31 Id. Property evaluations vacy in connection with news and entertain- 32 See Page v. Something Weird Video, 960 F. Supp. Pre-marketing counsel & coordination ment may be as rare as a celebrity without a 1438, 1444 (1996). Nationwide agent referral network scandal. ■ 33 Daly, 238 F. Supp. 2d at 1124. 34 Downing v. Abercrombie & Fitch, 265 F. 3d 994 (9th Cir. 2001). 1 See, e.g., Christian Bale Gets All Gotham on 35 See Dora v. Frontline Video, Inc., 15 Cal. App. 4th ‘Terminator’ Cinematographer, L.A. TIMES, available 536, 543-44 (1993). 310.230.7373 at http://latimesblogs.latimes.com/herocomplex 36 Downing, 265 F. 3d at 1002. DRE# 00902158 /2009/02/christian-bale.html (last visited Jan. 11, 2010). 37 Id. 2 Id.

Los Angeles Lawyer June 2010 15 June2010_IssueMaster.qxp 5/13/10 12:27 PM Page 16

practice tips BY KIRA MASTELLER

Revocation of a Family Trust without the Knowledge of the Cotrustee

MOST OF US REMEMBER EDWARD L. MASRY AS the crotchety criminal and tort lawyer and principal of Masry & Vititoe who, with self- trained legal assistant Erin Brockovich, filed a class action suit in 1993 against Pacific Gas and Electric Company. Along with two large law firms, four years later they won a $333 million settlement on behalf of 648 residents of the town of Hinkley, California. Masry made legal headlines again after his death. In his final days, Masry changed his trust without his wife’s knowledge, thereby pitching one last curve ball to the legal system. Edward and his wife Joette1 had created the Edward and Joette Masry Family Trust, which consisted of the property they acquired during their marriage. Edward and Joette were both the settlors and the trustees. The Masry family trust specifically provided: “[e]ach of the Settlors hereby reserves the right and power to revoke this Trust, in whole or in part, from time to time during their joint lifetimes, by written direction delivered to the other Settlor and to the Trustee.” Not long after the Masry family trust was created and just prior to Edward’s death, Edward executed a notice of revocation of interest in the trust and resigned as trustee. The purpose of the revocation was to transfer Edward’s assets from the Masry family trust to another trust he had created, the Edward L. Masry Trust (Edward Trust), in which two of his children from a prior marriage were the named successor cotrustees. Edward did not deliver the notice of revocation to Joette during his life; instead, it was delivered to her two weeks after his death. Edward’s most substantial asset was his employment agreement with Masry & Vititoe, which provided that if a termination occurred because of Edward’s death, the benefits of the agreement would go cation valid would not be good public policy, because the revocation’s “to the legal representatives of Edward’s estate” if no valid benefi- secrecy allowed one spouse to take advantage of the other. ciary designation were in place. The court found that when Edward The trial court found that under Family Code Section 100 one revoked his interest in the Masry family trust, his community share spouse is permitted to dispose of his or her share of the community of his benefits under the agreement went to the Edward Trust, which without the consent of the other and that to dispose of property is stated that its property included Edward’s interest in the law firm. As only a breach of fiduciary duty when it results in impairment to the trustee of the Masry family trust, Joette would have received all the claimant spouse’s present undivided half interest in the community benefits of the employment agreement. After Edward executed the property under Family Code Section 1101. Most important, the trial revocation of the Masry family trust, however, Joette was no longer court did not agree that the revocation was invalid because it failed a trustee but had become merely a beneficiary of her community inter- under the requirements of the trust. In fact, the trial court found that est in the employment agreement. The Edward Trust and its appointed the trust provisions were not the only way for Edward to revoke his trustees were entitled to Edward’s community interest in the employ- portion of the family trust.2 Later, the appellate court found: 1) the ment agreement. revocation provision of the Masry family trust did not preclude revocation by the statutory method of a writing delivered to a trustee, The Arguments 2) Edward revoked the trust by delivering notice of revocation to him- Joette, not having received notice of the revocation until after self as trustee, 3) his act of revoking the trust did not violate the statute Edward’s death, immediately sought a determination by the court that providing generally that each settlor may revoke as to the portion of the revocation was invalid because it had not been completed as the trust contributed by that settlor, and 4) the provisions of the trust required in the Masry family trust (in that the revocation had not been did not preclude revocation of the trust by the statutory method of delivered to her during Edward’s lifetime). In addition, she sought a a writing delivered by a settlor to a trustee, since the trust did not state determination that Edward had breached his fiduciary duty to his spouse under Family Code Section 1100 because he had not disclosed Kira Masteller is a partner at Michelman & Robinson’s Los Angeles office and

RICHARD EWING the revocation to his spouse. Third, she argued that to ﬁnd the revo- leads the ﬁrm’s Estate Planning and Trust Administration Practice Group.

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that the method of revocation it provided concludes that the distinction was clearly the trustee during the lifetime of the was exclusive. considered when the legislation replaced for- settlor. If the trust instrument explic- Joette relied upon Conservatorship of mer Civil Code Section 2280, and as a result, itly makes the method of revocation Irvine,3 which the appellate court found was implicit exclusivity does not apply under provided in the trust instrument the not persuasive because it relied upon cases Probate Code Section 15401. exclusive method of revocation, the interpreting former Civil Code Section 2280 Probate Code Section 15401(a)(2) repre- trust may not be revoked pursuant to rather than Probate Code Section 15401(a)(2). sented a change in the prior case law rule. The this paragraph. The court went on to observe that Section Masry court held that the change could be (b) Unless otherwise provided in the 15401(a)(2) was at best a clarification of for- presumed to have been made to require a instrument, if a trust is created by mer Civil Code Section 2280, which was statement of explicit exclusivity and thereby more than one settlor, each settlor may unclear with respect to explicitly exclusive lan- avoid the problems of interpretation inherent revoke the trust as to the portion of the guage, as opposed to the implicitly exclusive in determining issues of implicit exclusivity. trust contributed by that settlor, except language in the trust. The court of appeal also found that the as provided in Section 761 of the Louis Masry, trustee of the Edward Trust, method of revocation did not violate Probate Family Code. relied on Huscher v. Wells Fargo Bank,4 Code Section 15401(b), because, pursuant The Masry family trust revocation provi- which the appellate court, citing dicta, called to Family Code Section 761, “Unless the sions did not state that they were exclusive. helpful. Huscher analyzes the history of Civil trust instrument expressly provides other- Even though the trial court “had serious Code Section 2280 before it was replaced by wise, a power to revoke as to community reservations concerning the inherent unfair- Probate Code Section 15401. The Huscher property may be exercised by either spouse ness with the manner Ed Masry chose to court concluded that revocation language in acting alone.” modify his estate plan,” it denied Joette’s a trust document is reasonably subject to an revocation petition and found no explicit analysis under Family Code Section 100 of The Language in the Trust language in the Masry family trust that made whether the language explicitly or implicitly Prior to Masry, legal practitioners generally the revocation provisions exclusive. Thus, makes the method of revocation exclusive. placed language in revocable trust documents Edward could revoke the trust by delivering Both parties relied upon Gardenhire v. that was similar to the language in the Masry the notice of revocation to himself as settlor Superior Court.5 Joette found this case to family trust. In Masry, several specific issues and trustee, because under Section 15401(b), hold that if the language of revocation in the in the standard language were addressed: 1) “[E]ach settlor may revoke the trust as to trust is clear and express, the language is the a revocation must be in writing, signed and the portion of the trust contributed by the exclusive method to revoke. Louis found acknowledged by the settlors and delivered to Settlor, except as provided in Section 761 of Gardenhire to support the argument that the the trustee, 2) either settlor can revoke that the Family Code.” trustor had the choice of using either the lan- portion of the trust that pertains to his or her Family Code Section 761(b) provides: guage in the trust or the method for revoca- community property portion of the trust and “(b) Unless the trust instrument expressly tion stated in the Probate Code, because an to his or her separate property portion of provides otherwise, a power to revoke as to implicit revocation provision is not explicitly the trust, 3) if only one settlor is revoking his community property may be exercised by exclusive language. or her portion of the community trust or his either spouse acting alone.” The Masry fam- The Masry court ultimately found that or her separate trust, a copy of the revocation ily trust language stated, “Each of the Settlors Huscher’s reasoning, even though it was should be delivered to the other settlor, and hereby reserves the right and power to revoke expressed in dicta, led to the conclusion that, 4) the property distributed back to the sett- this Trust, in whole or in part, from time to absent language in the trust that its method lors will retain its community or separate time during their joint lifetimes, by written of revocation is exclusive, the trustor has property character. This language generally direction delivered to the other Settlor and to the option of revoking according to the did not include exclusivity language regard- the Trustee.” This language did not qualify as method provided in Probate Code Section ing the method of revocation. “expressly provides otherwise” under Family 15401(a)(2), under which Edward’s notice These standard provisions made certain Code Section 761. In fact, the Masry family to himself was sufficient as notice to the assumptions that the court in Masry was trust specifically states that either spouse can trustee. That there were two trustees did not forced to address. For example, if both sett- revoke the trust. change the court’s view. lors are the cotrustees, is the revocation Further, Edward’s revocation did not In affirming the trial court’s order, the required to be delivered to both trustees, or can equate to a breach of his fiduciary duties to appellate court in its review of Huscher relied it be delivered to only one trustee? Does deliv- his spouse under Family Code Sections 100 not upon the difference in facts between the ery of the revocation by the revoking settlor or 1100, or Probate Code Section 5020. cases (whether there was one trustor or two, have to be delivered to the other settlor dur- Edward did not attempt to transmute com- or an amendment rather than a revocation) ing the revoking settlor’s lifetime? If the trust munity property; he merely revoked his inter- but the differences between Civil Code Section is not silent about the four points above, is the est in the community property that he had ini- 2280 and its replacement, Probate Code language of the trust controlling, or can the tially placed into the family trust. Section 15401. Huscher makes clear that the revoking settlor choose another method of rule authorizing either implicit or explicit revocation as prescribed in the Probate Code? No Prior Cases exclusivity for revocation in the trust instru- Probate Code Section 15401 provides: Prior to Masry, there was no case on point ment only applies with respect to former A trust that is revocable by the settlor with respect to a revocation method between Civil Code Section 2280. Huscher determines may be revoked in whole or in part by married cotrustors and cotrustees regarding that under the current Section 15401(a)(2), a any of the following methods: their community property. Masry puts a mark trustor may use either the method of revo- (1) By compliance with any method of on the map deciding with certainty the effects cation in the trust instrument or the method revocation provided in the trust instru- of the Probate Code and the lack of exclusive prescribed by the statute unless the trust ment. language in the trust instrument. The Masry instrument explicitly makes exclusive the (2) By a writing (other than a will) family trust was missing specific language procedure provided in the trust. Huscher signed by the settlor and delivered to making exclusive the method of revocation in

Los Angeles Lawyer June 2010 17 June2010_IssueMaster.qxp 5/17/10 1:25 PM Page 18

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the trust. The lack of exclusive language in the trust allows the Probate Code to provide an additional method to revoke a married trust INVESTIGATIONS with respect to that settlor’s interest in the — DISCRETION AND CONFIDENTIALITY — community property or his or her separate property, without providing notice of the revocation to the other spouse. Had the trust Locates contained the exclusivity language, the revo- Asset Investigations cation, not having been delivered to the other settlor during Edward’s life, would have been Rush & Difficult Service of Process invalid. The court ruled that Probate Code Surveillance Section 15401 allows settlors an option with respect to revocation rather than solely rely- ing on a provision in a revocable married trust that may not serve a trustor well in the event the trustor desires to change a testamentary distribution provision as it pertains to his or her spouse. The Family Code certainly allows this flexibility, and the court in Masry confirmed that the legislative change from Civil Code Section 2280 to Probate Code Section 15401 allows spouses this The Power of Knowledge. option. In light of Masry, the method of revoca- 23 Years of Experience tion of an estate should be addressed with 818.344.2193 tel | 818.344.9883 fax | [email protected] married clients. If Joette had been counseled PI 14084 regarding the effect of the provisions for method of revocation and the ability for www.shorelinepi.com either party to revoke the trust without the knowledge of the other, would she have signed the trust instrument as drafted, or would she 800.807.5440 have requested that the language be written to provide that it was the explicitly exclusive method for revocation? The plain language of the trust appears to provide a clear method of revocation that requires notice to the other spouse. A lay person would probably not think that more specific language is necessary. Masry confirms, however, that Joette’s reading of Probate Code Section 15401 is not in accordance with the Family Code. Family Code Sections 100 and 1100 clearly indicate that a spouse can do whatever he or she wishes with his or her interest in community property without breaching his or her spousal fiduciary duty. It may therefore be difficult to explain this issue to clients. In counseling parties with respect to what happens if their marriage ends, for example during a divorce, an attorney should generally discuss 1) what can be done with respect to a trust and other assets prior to filing for dissolution, 2) what can and cannot be done once a petition for dissolution is filed, and 3) what can be done after the judgment for dissolution is entered. In preparing for divorce, clients can be advised to execute new wills, consider severing joint tenancies, and transfer title of property to tenants in common (rather than husband and wife as community property with right of survivorship). Spouses may also decide to remove certain assets from the trust so that if either spouse dies prior to the completion

Los Angeles Lawyer June 2010 19 June2010_IssueMaster.qxp 5/13/10 12:28 PM Page 20

of the trust, the community property is not automatically passed to the surviving spouse but instead passes to a new will. Once a petition for dissolution has been filed, automatic temporary restraining orders may provide: • Either party can revoke his or her portion of a revocable trust, but only with notice filed and served on the other party before a change takes place.6 • Either party can revoke the transfer to the beneficiary of a “nonprobate transfer” with notice filed and served before the changes A. J. Hazarabedian Guillermo A. Frias take effect.7 Glenn L. Block Bernadette M. Duran Artin N. Shaverdian • Either party can eliminate a right of survivorship for property—e.g., joint tenancy or community property with right of survivorship—but notice must be filed and served before the changes take effect.8 It may seem illogical, but when a couple RECEIVERSHIP SPECIALISTS is not in the midst of a dissolution proceed- Court Appointed Receivers and Referees ing, one spouse can revoke his or her trust 19 Years of Serving the Insolvency Community with no notice to the other spouse. And, on the other hand, in the midst of dissolution a spouse must file and serve notice before revoking a trust. Ultimately, however, the effect is the same: one spouse has the right to give “Committed to improving the value of your client’s assets, notice to the other of revocation of commu- at the lowest cost, while disputes are resolved.” nity interest in the trust assets. One spouse also has the right not to give the other notice of revocation, so long as the trust does not have an exclusive method for revocation and the revoking spouse gives notice to him- or herself. Should attorneys counsel individuals not to make the trust revocation language exclusive? After all, spouses cannot anticipate the manner under which they may need to revoke their interest in their trust and should leave themselves the opportunity to choose at the KEVIN SINGER JOHN RACHLIN time. As long as both spouses are aware of the Real Estate & Business Expert Attorney At Law effect of the choice, an attorney may have provided sufficient advice. Masry confirms the consistencies of the Receivership, Referee & Partition Assignments Probate Code and the Family Code, both of Real Estate Management & Sales which indicate that an individual spouse Business Management & Sales retains his or her rights with respect to his or her community property interests in the mar- Family Estate Management & Sales ital assets, whether those assets are in a trust Real Estate & Business Evaluations or not. Unless a spouse specifically opts out, he or she may control his or her interests as desired, without notice to the other spouse unless to do so would impair the other spouse’s interest. ■ SOUTHERN NORTHERN NEVADA ARIZONA CALIFORNIA CALIFORNIA OFFICE OFFICE 1 To avoid confusion, members of the Masry family are OFFICE OFFICE referred to by their first names. 7251 W. Lake Mead Blvd. 40 N. Central Avenue 2 See ROB ODE 11400 W. Olympic Blvd. 795 Folsom Street Suite 300 Suite 1400 P . C §15401(b). Suite 200 1st Floor Las Vegas, NV 89128 Phoenix, AZ 85004 3 Conservatorship of Irvine, 40 Cal. App. 4th 1334, 47 Los Angeles, CA 90064 San Francisco, CA 94107 Cal. Rptr. 2d 587 (1995). Tel 702.562.4230 Tel 602.343.1889 4 Tel 310.552.9064 Tel 415.848.2984 Huscher v. Wells Fargo Bank, 121 Cal. App. 4th 956, 18 Cal. Rptr. 3d 27 (2004). 5 Gardenhire v. Superior Court, 127 Cal. App. 4th 882, 26 Cal. Rptr. 3d 143 (2005). 6 FAM. CODE §2040(b)(2), (d)(1). www.ReceivershipSpecialists.com 7 Id. 8 FAM. CODE §2040 (b)(3), (d)(1).

20 Los Angeles Lawyer June 2010 June2010_IssueMaster.qxp 5/13/10 12:28 PM Page 21

practice tips BY HERNALDO J. BALTODANO AND DAVID MARTINEZ

Determining the Reach of the Lilly Ledbetter Fair Pay Act

IN JANUARY 2009, PRESIDENT OBAMA signed the Lilly Ledbetter Fair ent effect to discriminatory conduct outside of that period….But Pay Act, which extends the time period in which employees may sue current effects alone cannot breathe life into prior, uncharged employers for discriminatory compensation practices. The LLFPA discrimination.3 appears to apply exclusively to discriminatory pay, but recent deci- In her dissent, Justice Ruth Bader Ginsberg challenged the major- sions have construed the legislation more expansively. Several U.S. dis- ity opinion for its disregard of what she characterized as fundamen- trict courts are finding the LLFPA applicable to any employment deci- tal workplace realities: sion that ultimately affects an employee’s pay, such as allegedly The Court’s insistence on immediate contest overlooks com- discriminatory denials of promotions, negative performance evalu- mon characteristics of pay discrimination. Pay disparities often ations, and unfavorable job assignments. According to these cases, occur, as they did in Ledbetter’s case, in small increments; employees may presumably sue and recover two years of back pay cause to suspect that discrimination is at work develops only for discrimination that occurred years or decades before, so long as the discriminatory practice results in the employee experiencing The truth lies somewhere in between the Spector and Mikulski an adverse impact on pay within the two years preceding the filing of an administrative charge of discrimination. arguments. Indeed, the court decisions issued in the wake of the Nevertheless, other district courts have strictly construed the LLFPA. Practitioners await further guidance from the federal appel- passage of the LLFPA fall into contrasting lines of authority. late courts, which have not yet weighed in on the issue of the LLFPA’s breadth. In the mean- time, plaintiffs and their counsel perceive new opportunities to press their claims, while employers and their coun- over time. Comparative pay information, moreover, is often hid- sel face increasing challenges that require new strategies. den from the employee’s view. Employers may keep under Prior to the LLFPA, a claim for a discriminatory nonpromotion wraps the pay differentials maintained among supervisors, that occurred before the charge-filing period—for example, 300 days no less the reasons for those differentials. Small initial dis- for Title VII claims—was time-barred. Now, an employee can sue and crepancies may not be seen as meet for a federal case, partic- recover back pay for a discriminatory nonpromotion if it “affects” ularly when the employee, trying to succeed in a nontraditional pay, and the aggrieved employee received less pay during the two years environment, is averse to making waves.4 preceding the filing of the charge. In response to what she perceived as the “parsimonious reading It is no secret that the LLFPA is a response by Congress to the U.S. of Title VII,” Justice Ginsberg called for Congress to act: “Once again, Supreme Court’s controversial decision in Ledbetter v. Goodyear the ball is in Congress’ court.” Congress did act, declaring that Tire and Rubber Company, Inc.1 In Ledbetter, the Supreme Court held “[t]he Ledbetter decision undermines those statutory protections by that a long-time Goodyear employee, Lilly Ledbetter, could not chal- unduly restricting the time period in which victims of discrimination lenge ongoing pay discrimination that she maintained resulted from can challenge and recover for discriminatory compensation deci- discriminatory performance evaluations received many years ear- sions or other practices, contrary to the intent of Congress.”5 lier. Although she had not filed timely discrimination charges with the Under the provisions of the LLFPA, an act of discriminatory Equal Employment Opportunity Commission challenging those dis- compensation occurs when 1) a discriminatory compensation deci- criminatory performance evaluations, she argued that paychecks sion is adopted, or 2) an individual becomes subject to it or is affected received during the charge-filing period were discriminatory and by its application, “including each time wages, benefits, or other com- thus actionable because her paychecks “would have been larger if she pensation is paid, resulting in whole or in part from such a decision had been evaluated in a nondiscriminatory manner prior to the or other practice.”6 The LLFPA amends Title VII of the Civil Rights EEOC charge period.”2 Act, the American with Disabilities Act, the Age in Discrimination Act, Writing for a divided court, Justice Samuel Alito rejected Ledbetter’s and the Rehabilitation Act. argument: Congressional opponents of the LLFPA argued that the “other prac- Ledbetter, as noted, makes no claim that intentionally discriminatory conduct occurred during the charging period or Hernaldo J. Baltodano is an associate at Sanchez & Amador, LLP, where he rep- that discriminatory decisions that occurred prior to that period resents management in single-plaintiff and class action employment liti- were not communicated to her. Instead, she argues simply gation. David Martinez is a partner at Robins, Kaplan, Miller & Ciresi L.L.P., that Goodyear’s conduct during the charging period gave pres- where he practices business, class action, and intellectual property litigation.

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tice” language could encompass employment might use to supersede all statutes of limita- law the “Lilly Ledbetter Fair Pay Act practices beyond pay decisions. Just days tions in our nation’s various civil rights of 2009.” Thus, while [the defendant]’s before the bill’s passage, the U.S. Senate acts.”13 A finding by the district court in untimeliness argument was valid prior Republican Policy Committee warned that the New Jersey is in accord: “While the Act cer- to last week, with the passage of the text of the LLFPA “essentially eliminates time tainly contains expansive language in super- Act Plaintiffs’ title VII claims are no limitations for claims of employment dis- seding the holding in Ledbetter…it does not longer administratively barred.20 crimination in many cases because non-pay purport to overturn Morgan, and thus does The plaintiffs’ victory was short-lived, discrimination claims (including, for example, not save otherwise untimely claims outside the however, since the court ultimately granted the a wrongful denial of a promotion) often have discriminatory compensation context.”14 Also employer’s motion for summary judgment. some effect on compensation.”7 Fearing that in agreement is a district court in the Eastern The court did so because the plaintiffs failed the LLFPA would open the litigation flood- District of Virginia, which held in Masterson to present a prima facie case of discrimina- gates, Senator Arlen Specter proposed an v. Wyeth Pharmaceuticals15 that promotion tion—that is, they did not prove that they amendment that would have stricken the and job assignment claims based on age and occupied similar jobs to higher-paid white “other practice” language. Senator Barbara gender were time-barred and stated that the employees—and could not rebut the employ- Mikulski, one of the LLFPA’s chief propo- LLFPA “do[es] not affect this analysis” since er’s legitimate nondiscriminatory reasons for nents, rejected Specter’s amendment: “Senator the LLFPA “only pertain[s] to discrimina- the pay disparities.21 Specter has said that his amendment is nec- tion claims respecting unfair compensation, A district court in the Southern District essary because the bill, as drafted, is over- which is not an issue in this case.” of Mississippi also expanded the scope of the broad and could apply to discrete personnel Because of this line of cases, plaintiffs LLFPA in Gentry v. Jackson State Uni- decisions, like promotions and discharges. have tried to circumvent Morgan by charac- versity.22 The case involved a claim for the That’s not true. The bill specifically says that terizing their LLFPA claims as “continuing allegedly discriminatory denial of tenure at it is addressing ‘discrimination in compen- violations” instead of one-time discrete acts a university. The court noted that “the denial sation.’ That limiting language means that it that would trigger the charge-filing period.16 of tenure, which plaintiff has contended neg- already only covers such claims—nothing For example, in Holloway v. Best Buy,17 the atively affected her compensation, qualifies more, nothing else.”8 plaintiffs filed a putative nationwide race and as a ‘compensation decision’ or ‘other prac- The truth lies somewhere in between the gender class action alleging discriminatory hir- tice’ affecting compensation within the Spector and Mikulski arguments. Indeed, the ing, job assignment, promotion, and com- recently-enacted Lilly Ledbetter Fair Pay Act court decisions issued in the wake of the pas- pensation practices. Defendant Best Buy of 2009.”23 sage of the LLFPA fall into contrasting lines moved for judgment on the pleadings on the Other courts have gone even further by of authority. named plaintiffs’ claims for discriminatory ini- effectively inviting plaintiffs to plead that tial job assignments on grounds that none had challenged, otherwise time-barred employ- Strict and Expansive filed timely charges. The plaintiffs opposed the ment actions adversely affect compensation. Several district courts have relied on the motion by arguing that the LLFPA saved For example, in Stewart v. General Mills, LLFPA’s “discrimination in compensation” their claims because initial job assignments Inc.,24 a district court in the Northern District language in limiting the LLFPA to compen- could not be divorced from job assignments of Iowa concluded that the LLFPA did not sation claims—“nothing more, nothing else.” that occurred within the charge-filing period. apply because “[t]his legislation pertains to For example, in Rehman v. State University The court rejected the plaintiffs’ argument, discriminatory compensation, which is not at of New York at Stony Brook,9 the court stating that the “plaintiffs have not established issue in the instant action and does not affect explained, “It is well-settled that certain that the FPA [LLFPA] provides support for the the court’s analysis.” However, the court adverse employment practices such as the proposition that the court should consider any noted in its ruling that the “[p]laintiff has not failure to promote, failure to compensate claims of ‘initial assignments’ that are outside suggested or submitted evidence that her tem- adequately, undesirable work transfers, and the limitations period as actionable under a porary reassignment caused a reduction in denial of preferred job assignments are dis- ‘continuing violations’ theory.”18 salary, benefits or prestige.”25 A district court crete acts.” Therefore, the “plaintiff has no Despite these decisions, other courts have in the Eastern District of Pennsylvania simi- right to recover damages based upon dis- allowed employees to challenge otherwise larly stated that “[t]he Ledbetter Act does not crete acts of discrimination occurring prior to time-barred nonpromotions and job assign- help Plaintiff here because she pressed no June 16, 2006 under Title VII.”10 Other ment decisions under the LLFPA on grounds discriminatory compensation claim with courts have followed suit.11 that these practices “affect” compensation. respect to her failure to promote.”26 Indeed, by following the Supreme Court’s For example, in Bush v. Orange County Some decisions, moreover, suggest that a pre-Ledbetter holding in National Railroad Corrections Department,19 a district court plaintiff need only plead a plausible nexus Passenger Corporation v. Morgan that an in the Middle District of Florida permitted the between the employment decision and an “employment practice” typically refers to plaintiffs to challenge “demotions and pay adverse effect on pay in order to overcome “a discrete act of single ‘occurrence,’”12 sev- reductions that occurred in 1990”—16 years timeliness challenges. In Minnesota, for exam- eral U.S. district courts have applied the before filing their lawsuit. The plaintiffs main- ple, a district court held in Onyiah v. St. LLFPA narrowly. They did so by finding that tained that the alleged discriminatory non- Cloud State University27 that the plaintiff’s claims based on discrete acts, including job promotions were accompanied by pay reduc- claim based on a alleged refusal to hire was assignments and promotions, are time-barred tions. The court held that the challenged time-barred because “the Fair Pay Act applies if they fall outside the limitations period— nonpromotions were “no longer adminis- only to pay discrimination claims” and the even if the acts arguably affected compen- tratively barred” under the LLFPA: plaintiff “failed to provide the essential nexus sation. Under Ledbetter, Plaintiffs’ claims between the alleged refusal to hire and the According to a district court in the would plainly be barred. However, the Plaintiff’s pay discrimination claims.” Northern District of Iowa, “There is no indi- Ledbetter decision prompted a Con- Likewise, a district court in the Southern cation Congress intended the Ledbetter Act gressional response, and just last District of Mississippi held in Johnson v. to serve as a trump card that [plaintiffs]… week…President Obama signed into Watkins28 that the LLFPA did not apply to a

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claim of quid pro quo sexual harassment miss the termination and failure to rehire Paso Corporation,38 a district court in because the plaintiff’s “compensation was claims because they arguably did not affect Colorado initially held that plaintiff not affected.” compensation under the LLFPA, the court Tomlinson’s age discrimination claim was dismissed these on the ground that the plain- time-barred because “the discriminatory act Impact of the Discovery Rule tiff failed to take prompt action by waiting and Mr. Tomlinson’s actual knowledge of Still another series of court decisions have until April 3, 2007, to file his discrimination that act and its alleged disparate effect on focused on whether a claim is barred under the charge—“long after the limitations period older workers occurred more than 300 days “discovery rule”—a creation of case law had run.” Although it did not explicitly ref- before he filed his charge of discrimination.” addressing discrimination claims.29 Under the erence the discovery rule, its imprimatur on The court later reversed course while acknow- rule, claimants must take prompt action to file the court’s reasoning is obvious: ledging that the “policy justifications for a discrimination charge when they know or According to his own testimony, plain- enacting the Ledbetter Act include the diffi- should have known of the alleged wrongdo- tiff knew in late October 2005 that culty of detecting pay discrimination, since ing. The Southern District of New York his employment had been terminated pay-setting decisions are unlikely to be viewed addressed this issue in Vuong v. New York Life and that other faculty members who as discriminatory and information about Insurance Company.30 The plaintiff in Vuong were younger, white, female and non- comparators is generally confidential.” alleged discrimination based on race and Nigerian had been rehired for the national origin in the plaintiff’s January 1998 January 2006 semester, while he had Post-LLFPA World for States and denial of promotion to the position of sole not been. Dr. Olubadewo believed at Defense Counsel managing partner. The denial of promotion that time that he was not being rehired State courts are also beginning to grapple arguably affected the plaintiff’s compensa- because of discrimination…and that with the LLFPA’s impact on state antidis- tion because the plaintiff would have received was why he contacted attorney Luscy crimination statutes. For instance, a New all performance-related compensation typi- for legal counsel.34 York state court held that the plaintiffs’ gen- cally given to managing partners. Unlike other, The court granted the employer’s motion der discrimination claims were time-barred non-Asian managing partners from other for summary judgment, stating that “the lim- because the LLFPA “does not affect this offices in the firm, the plaintiff had to split his itations period would have begun to run in court’s analysis.”39 The plaintiffs alleged performance-based bonus with a comanaging October or early November 2005 when plain- that the employer’s method of assigning jobs partner. The court nevertheless held that tiff knew these facts and believed that he had and favoring less qualified males caused the Vuong’s promotion claim was time-barred suffered discrimination.”35 plaintiffs “to earn significantly less money because “[i]t is clear that New York Life com- The Southern District of Texas also exam- than men in comparable positions.” How- mitted a ‘discrete’ act in January 1998 when ined the plaintiff’s diligence under the dis- ever, a district court in the Middle District of it promoted plaintiff and DeBuono to be co- covery rule in a post-LLFPA environment. In Pennsylvania interpreting Pennsylvania’s Managing Partners of the SFGO, rather than Leach v. Baylor College of Medicine,36 an antidiscrimination law held that the plaintiffs’ promoting plaintiff to be sole Managing African American plaintiff sued his former claims alleging discriminatory paychecks Partner. Of course, plaintiff knew what was employer for discrimination, including “dis- were timely under the LLFPA even though the occurring at that time. This was more than parate job responsibilities.” While acknowl- plaintiffs knew of their salary disparity but 300 days before plaintiff filed with the EEOC edging that it was “unclear from the record” failed to file timely administrative charges: on August 2, 2002, and any claim of wrong- whether the plaintiff “had notice of the dis- “[T]he Court concludes that each paycheck doing at that time is time-barred.”31 parate job responsibilities more than 300 issued pursuant to a discriminatory pay Interestingly, the court allowed Vuong to days before he filed his EEOC discrimination scheme is independently actionable under challenge a February 1998 decision con- charge,” the court side-stepped the timeliness [Pennsylvania’s antidiscrimination law].”40 cerning the allocation of the performance- issue under the LLFPA because the plaintiff Employment law practitioners in Cal- related bonus that left the plaintiff with a could not establish a prima facie case of dis- ifornia who are more likely to litigate dis- smaller percentage of the bonus. The court crimination in any event. Even though it crimination claims under the state Fair stated that the LLFPA “clearly governs the avoided making a decision under the LLFPA, Employment and Housing Act should be compensation claim in the instant case.”32 the court demonstrated a willingness to apply aware that while the LLFPA does not apply Not only does the Vuong decision illustrate principles derived from the discovery rule to FEHA claims, courts may use the LLFPA the application of the discovery rule, it sug- to a claim of discrimination based on dis- to support California’s continuing violations gests that the ability to successfully challenge parate job responsibilities—a claim that, at theory set forth in Richards v. CH2M Hill, an otherwise time-barred employment prac- best, possessed a tenuous connection to com- Inc.41 In Richards, the California Supreme tice affecting pay will depend on how a plain- pensation and was not tethered to any impact Court held that a plaintiff could challenge an tiff frames the connection between the on compensation. According to the Leach allegedly discriminatory employment practice employment practice at issue and its effect on court, “Although the Supreme Court in even if the employee unreasonably failed to compensation. Had Vuong characterized the Ledbetter ‘declined to address whether Title file a timely administrative charge. However, January 1998 denial of promotion differ- VII suits are amenable to a discovery rule,’ the plaintiff could only do so if the alleged dis- ently, the employer may have had to defend the Fifth Circuit has held that ‘the operative crimination had achieved a certain degree of this decision on the merits. date from which the limitations period begins permanence that rendered futile an employ- The Eastern District of Louisiana reached to run is the date of notice of the adverse ee’s conciliation efforts with the employer. A a similar conclusion in Olubadewo v. Xavier action.’”37 district court in the Eastern District of University33 by finding that the plaintiff had Nonetheless, at least one court recently California avoided this issue in Harris v. City failed to take prompt action when he knew applied the LLFPA to claims alleging the dis- of Fresno: of the discrimination. The plaintiff alleged that criminatory accrual of pension benefits and No party has discussed whether to the defendant university terminated and failed deemed them timely even though the plain- and what extent the Lilly Ledbetter to rehire him in October 2005 because of tiff indisputably knew about the alleged dis- Fair Pay Act impacts the statute of his race and national origin. Rather than discrimination years earlier. In Tomlinson v. El limitations issue in this case. Given

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that neither party has raised or briefed this issue, and because the City’s motion can be decided on another Anita Rae Shapiro ground, it is unnecessary to decide SUPERIOR COURT COMMISSIONER, RET. whether the Lilly Ledbetter Fair Pay Act brings the reclassification denials within the statute of limitations.42 PRIVATE DISPUTE RESOLUTION As district courts continue to wrestle PROBATE, CIVIL, FAMILY LAW with the scope of the LLFPA, it seems cer- PROBATE EXPERT WITNESS tain that some district courts will be willing to interpret the LLFPA broadly and thus TEL/FAX: (714) 529-0415 CELL/PAGER: (714) 606-2649 allow plaintiffs to challenge employment E-MAIL: [email protected] practices that occurred years ago so long as http://adr-shapiro.com they affect compensation. This is welcome news for plaintiffs but not for employers, who now face the prospect of defending employment decisions that occurred in the more distant past. However, some key themes emerge from these early decisions that will help employers adapt to their new reality—at least until the federal appellate It’s More Than Just a Referral courts flesh out this emerging body of law to reconcile the competing interests of rem- It’s Your Reputation edying discrimination and providing employers with closure and predictability. Make the Right Choice First, a plaintiff’s ability to challenge an otherwise time-barred employment practice will largely depend on the ability to show a Personal Injury • Products Liability nexus between the alleged discriminatory Medical Malpractice • Insurance Bad Faith practice and compensation as well as sufficient diligence under the discovery rule. Second, the list of employment practices that can arguably Referral Fees per State Bar Rules affect compensation is virtually limitless when left to the creativity of plaintiffs’ attorneys, www.cdrb-law.com who already benefit from antidiscrimination laws and fee-shifting statutes. As a result, 310.277.4857 employers should ensure that their pay decisions are well documented and factually supported in a manner sufficient to provide an The More You Know About Us, effective defense in court should the need The Better Choice You Will Make arise. This is especially critical when the decision maker no longer works for the employer or is otherwise unavailable—or unable—to explain any pay disparities. Employers should also strive to make personnel decisions more transparent, especially those decisions that affect an employee’s compensation, such as performance reviews. They should inform employees whether their decisions will have an impact on pay. Indeed, the recent decision by the Third Circuit Court of Appeals in Mikula v. Allegheny County of Pennsylvania serves as a speed bump for employers. The court held that a “failure to answer a request for a raise qualifies as a compensation decision [under the LLFPA] because the result is the same as if the request had been explicitly denied.”43 The inescapable reality is that businesses and human resources professionals must 10100 Santa Monica Blvd., Suite 2460, Los Angeles, California 90067 always operate with an awareness of the lat- 310.277.4857 office ■ 310.277.5254 fax est developments in employment law. Not www.cdrb-law.com only are they at greater risk of defending personnel decisions that occurred decades

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ago, but they also face increased monetary (S.D. Miss. May 29, 2009). thereby receive benefits in court above and beyond exposure for liability and more costly litiga- 29 See, e.g., Velasquez v. Fibreboard Paper Prods. those of the women who actively sought to remedy dis- Corp., 97 Cal. App. 3d 881, 887-88 (1979) (applying crimination in the workplace for both her benefit and tion. Proactively implementing solid employ- discovery rule to strict liability action). their own.”). ment practices now will help avoid problems 30 Vuong v. New York Life Ins. Co., 2009 U.S. Dist. 38 Tomlinson v. El Paso Corp., 2009 U.S. Dist. LEXIS in the future. Employers and their counsel LEXIS 9320 (S.D. N.Y. Feb. 6, 2009). 77341 (D. Colo. Aug. 28, 2009). need only read the court’s decision in Bush v. 31 Id. at *21. 39 Siri v. Princeton Club of N.Y., 2009 N.Y. slip op. Orange County Corrections Department44 32 Id. at *24. 1357 (N.Y. App. Div. Feb. 24, 2009). 33 40 to get a glimpse of what it is like in the post- Olubadewo v. Xavier Univ., 2009 U.S. Dist. LEXIS Schengrund, 2009 WL 3182490, at *11. 29318 (E.D. La. Apr. 6, 2009). 41 Richards v. CH2M Hill, Inc., 26 Cal. 4th 798 (2001). LLFPA legal landscape to defend and explain 34 Id. at *31. 42 Harris v. City of Fresno, 625 F. Supp. 2d 983, 1000 a nonpromotion that occurred 16 years prior 35 Id. at *31-32. (E.D. Cal. 2009). to the filing of the lawsuit. Fortunately for 36 Leach v. Baylor Coll. of Med., 2009 WL 385450 43 Mikula v. Allegheny County of Pa., 583 F. 3d 181 employers, plaintiffs must still prove their (S.D. Tex. Feb. 17, 2009). (3d Cir. 2009). 37 44 cases to ultimately prevail. Id. at *18; see also Schengrund v. Pennsylvania Bush v. Orange County Corr. Dep’t, 597 F. Supp. 2d State Univ., 2009 WL 3182490, at *9 (M.D. Pa. Sept. 1293 (M.D. Fla. 2009). Bush shows that an employee plaintiff’s 30, 2009) (“[The plaintiff] cannot simply ignore the 45 See Ledbetter v. Goodyear Tire & Rubber Co., Inc., inability to establish a prima facie case of facts of discrimination being uncovered around her and 550 U.S. 618, 619 (2007). pay discrimination or rebut an employer’s proffered legitimate nondiscriminatory reasons for pay disparities will still doom the plaintiff’s claims. Plaintiffs still face a steep climb even as the LLFPA does what Justice Alito claimed “current effects alone” could not do: “breathe life into prior, uncharged discrimination.”45 ■

1 Ledbetter v. Goodyear Tire & Rubber Co., Inc., 550 U.S. 618 (2007). 2 Id. at 624. 3 Id. at 619. 4 Id. at 645. 5 H.R. 11, 111th Cong. (1st Sess. 2009). 6 Lilly Ledbetter Fair Pay Act of 2009, Pub. L. No. 111- 2, §3, 123 Stat.5 (emphasis added). 7 U.S. Senate Republican Policy Committee Legislative Notice, Jan. 14, 2009. 8 See note 6, supra, S. Deb. (Jan.21-22, 2009). 9 Rehman v. State Univ. of N.Y. at Stony Brook, 596 F. Supp. 2d 643 (E.D. N.Y. 2009). 10 Id. at 651. 11 See Leach v. Baylor Coll. of Med., 2009 U.S. Dist. LEXIS 11845 (S.D. Tex. Feb. 17, 2009); Maher v. International Paper Co., 600 F. Supp. 2d 940 (W.D. Mich. 2009); and Schuler v. Pricewaterhouse Coopers, LLP, 595 F. 3d 370 (D.C. Cir. 2010). 12 National R.R. Passenger Corp. v. Morgan, 536 U.S. 101 (2002). 13 EEOC v. CRST Van Expedited, Inc., 2009 U.S. Dist. LEXIS 40251 (N.D. Iowa May 11, 2009). 14 Richards v. Johnson & Johnson Consumer Prods. Cos., 2009 U.S. Dist. LEXIS 46117 (D. N.J. June 2, 2009). 15 Masterson v. Wyeth Pharms., 2009 U.S. Dist. LEXIS 34968 (E.D. Va. Apr. 23, 2009). 16 See, e.g., Holloway v. Best Buy Co., Inc., 2009 U.S. Dist. LEXIS 50994 (N.D. Cal. May 28, 2009). 17 Id. 18 Id. at *24. 19 Bush v. Orange County Corr. Dep’t, 597 F. Supp. 2d 1293 (M.D. Fla. 2009). 20 Id. at 1296. 21 Id. at 1297-98. 22 Gentry v. Jackson State Univ., 610 F. Supp. 2d 564 (S.D. Miss. 2009). 23 Id. at 566. 24 Stewart v. General Mills, Inc., 2009 WL 350639 (N.D. Iowa Feb. 11, 2009). 25 Id. at *13. 26 Rowland v. Certainteed Corp., 2009 U.S. Dist. LEXIS 43706 (E.D. Pa. May 21, 2009). 27 Onyiah v. St. Cloud State Univ., 2009 U.S. Dist. LEXIS 85333 (D. Minn. Aug. 27, 2009). 28 Johnson v. Watkins, 2009 U.S. Dist LEXIS 45080

Los Angeles Lawyer June 2010 25 June2010_IssueMaster.qxp 5/13/1012:29PMPage26 o STRENGTH 26 CHARACTER EVIDENCE propensity ordispositiontoact acertain ing awitness’s credibility. character evidenceforthepurposeofattack- The keyisknowingwhenandhowtouse ability inacivilactiontoimpeachwitness. and complexareaofevidenceisitsavail- how touseit.Oneaspectofthisvariegated acter evidenceis,howtogenerateit,and lawyers lackanunderstandingofwhatchar- few civilmattersreachtrial,many moments inaciviltrial.Perhapsbecauseso evidence cansupplyoneofthemosteffective has toomuch.” appreciable probativevaluebutbecauseit exclude muchofit,“notbecauseithasno of statutesintheEvidenceCode.Civilcourts most complexandmisunderstoodclusters civil trials is subjecttoexacting standards The admissibility ofcharacter evidence in Character evidencerevealsa person’s Los AngelesLawyer f 1 When admitted,character June 2010 by Michael D. Schwartz and Phillip R.Maltin Character is oneofthe the bestpredictorsoffuturebehavior. acter, asevidencedbypastconduct,isoneof what experienceanecdotallyteaches—char- opinions andreputations.Scienceconﬁrms behavior. Thathistory, inturn,generates character, ortraitofcharacter, isahistoryof lying). Behindeveryassessmentofaperson’s of witnessesonthestand(tellingtruthor or failingtodosomething)andtheconduct conduct ofpartiespretrial(doingsomething dictor ofhumanbehaviortodetermine ifa mit ajuryunlimiteduseofthis robust pre- power ofcharacterevidence.Sowhy notper- ward.” inferences fromiteitherforwardorback- or lesspermanentqualityandwemaymake court succinctlystates,“[C]haracterisamore way. Science andexperiencebothrecognizethe 2 Legal actionsareaboutconduct:the 4 3 As one ling science.” beyond therangeofapredictiveorcontrol- gist B.F. Skinner, “[Humanbehavior] maybe ﬁdence. Accordingtoauthorandpsycholo- predictions oftengenerateunwarrantedcon- predictions abouthowapersonwillact,the accurate. Whileitmaypromptcompelling behavior, itcanbemorepersuasivethan past conductisoneofthebestpredictors character? Two reasonscontrol.First,while person’s conductconformedwithhisorher Association’s Trial AdvocacyProject (TAP). are instructors inthe Los Angeles County Bar & Rees LLP, isatriallawyer. Schwartz andMaltin a partnerintheEmploymentLaw Group atGordon ney fortheCity ofLos Angeles. Phillip R. Maltin, Michael D. Schwartz servesasadeputycity attor- Second, thisformofproofoftenspawns 5

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unfair prejudice, surprise, and undue con- understanding the complex rules underpin- limited only to those that involve honesty and sumption of time.6 Jurors may find against a ning the admission of character evidence in veracity pursuant to Evidence Code Section side in a case simply because they do not civil cases. 786.32 With the passage of Proposition 8 in like one of the parties based upon their per- A character witness may testify to his or 1982, the California Constitution—under ception of that person’s character.7 In a legal her opinion of another witness’s trait for Article I, Section 28(f)—abrogated Evidence system that strives for justice and struggles for honesty and veracity. When character wit- Code Sections 786 through 790 for criminal economy, character evidence can invite a jury nesses testify about their opinion of a witness’s cases, allowing for the use of any felony to decide a case based on who the “better” honesty and veracity, they must, as a foun- conviction involving moral turpitude—that person is, not whether someone is legally dational matter, know the witness well enough is, a readiness to do evil.33 In criminal cases, responsible or telling the truth. Even the to deliver an informed opinion of the witness’s any felony conviction that evidences a per- unlikeable deserve justice in court. truthfulness.20 Even experts can deliver this son’s readiness to do evil, whether that felony Therefore, while the law severely restricts type of opinion.21 directly reflects on honesty and veracity or the use of character evidence in civil cases, it Opinion evidence, while often more per- not, can be used to impeach a witness, includ- does not completely prohibit it. Character suasive than reputation evidence, can be ing, for example, felonies such as arson, evidence is admissible in civil cases in three problematic under Evidence Code Section domestic violence, and rape.34 In almost situations: 352. While specific instances of conduct may every civil case, attorneys ask deponents 1) When the existence of a character trait is help to formulate opinions, Section 787 pro- whether they have been convicted of a felony, itself an issue to be determined in the case, hibits the use of “evidence of specific instances because that evidence, if reflecting on honesty character evidence is admissible to prove the of [a witness’s] conduct relevant only as tend- and veracity, can be admissible at trial to trait exists.8 ing to prove a trait of his character…to attack impeach the witness.35 2) When a witness testifies, character evi- or support the credibility of a witness.”22 California’s Discovery Act permits the dence is admissible regarding the witness’s Thus, for instance, a court should prohibit a discovery of admissible evidence as well as any honesty and veracity.9 character witness from testifying that a party type of information reasonably calculated to 3) When the lawsuit involves allegations of sex- to a lawsuit is truthful simply because the lead to the discovery of admissible evidence.36 ual misconduct, character evidence is admis- party does charitable work or volunteers at In fact, it allows inquiry into specific instances sible to prove the conduct of the parties.10 a homeless shelter. of conduct beyond felony convictions reflect- In contrast to the broader evidence per- To present reputation evidence,23 as a ing on honesty and veracity despite their mitted in criminal cases,11 the Evidence Code foundational matter, the impressions of the inadmissibility to prove character. It does permits no other instances of character evi- person’s reputation must have crystallized at this because such instances of conduct may dence in civil trial practice. a time relevant to the lawsuit.24 A party can lead to the discovery of admissible opinion Every time a witness testifies—whether establish reputation evidence only through a and reputation evidence. Witnesses base their in trial before a jury, at a hearing before a witness who knows the reputation25 and not opinions upon, and reputations emerge from, judge, in a deposition, in a declaration, by proof of specific instances of conduct.26 specific instances of a person’s conduct. through verified pleadings, or through veri- Whether the character witness knows the Counsel questioning a witness during a depo- fied responses to written discovery—that per- individual about whom he or she testifies is sition should ask whether the deponent is son’s credibility is at issue, and his or her irrelevant.27 The testimony centers on the aware of instances of another witness’s dis- character traits supporting or negating hon- “estimation in which an individual is held; in honest conduct. esty and veracity are admissible.12 Evidence other words, the character imputed to an Consider, for example, a case in which a of a witness’s propensity and disposition for individual rather than what is actually known female employee alleges that a supervisor telling lies (and in some instances for telling of him either by the witness or others.”28 It discriminated against her. She hopes to admit the truth13) is admissible as circumstantial evi- is “the net balance of so many debits and cred- evidence that the supervisor had discrimi- dence of truthfulness while testifying. its”29 in a person’s life that it evolves with nated against others in virtually the same Evidence of good character is admissible only every new action the person takes. way. With this evidence, the plaintiff-employee after a court has admitted evidence of a wit- tries to show the supervisor’s propensity to ness’s “bad character,”14 which is typically dis- Admissibility of Specific Instances of discriminate. The evidence is inadmissible.37 honesty. Significantly, under no circumstances Conduct A court may, however, permit the evidence for may a party use a witness’s religious belief to Specific instances of conduct are by far the a different reason. It may determine that the support or challenge the witness’s honesty most powerful type of character evidence for evidence tends to reveal the motive or intent or veracity.15 a jury. The first words out the mouths of that prompted the supervisor’s allegedly dis- Character evidence takes three different many jurors after a verdict are typically, “Has criminatory actions against the plaintiff.38 forms—opinion, reputation, and specific [the defendant] done [the alleged wrongdo- Thus, discovery of specific instances of con- instances of conduct.16 Opinion evidence, ing] before?” Nevertheless, in civil cases duct beyond felony convictions reflecting on whether lay or expert, is the specific impres- California excludes specific instances of con- honesty and veracity may lead to other chan- sion of a person’s character by someone who duct as character evidence except for felony nels for admitting probative and relevant evi- knows the person reasonably well, through convictions reflecting honesty and veracity.30 dence in trial, such as evidence of a “bias, direct contact and specific instances of con- Thus the only specific instance of conduct per- interest or other motive to lie”39 or evidence duct.17 Reputation evidence is the collective mitted to be introduced as character evidence of a “crime, civil wrong, or other act” pur- impression of a person’s character, or trait of is a felony conviction for crime in which hon- suant to Evidence Code Section 1101(b).40 it, shared by a group close enough to the esty and veracity play a part, such as grand Almost never heard at a deposition, but person to form reliable conclusions.18 Specific theft, fraud, and perjury.31 permitted, are inquiries into a deponent’s instances of conduct are just that—specific Here is where a difference between the opinion about another witness’s reputation for instances that reflect upon a person’s char- rules in civil and criminal cases is pro- truthfulness.41 Effective use and discovery of acter.19 Understanding how the three work, nounced. In criminal cases, felony convictions opinion and reputation evidence are equally and when they are admissible, is critical to used to impeach a witness’s credibility are not advantageous to the employer in defending

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the claim. The plaintiff-employee, who is cer- often allow this evidence and argument, should tell a story like this: tainly going to testify at trial, puts her char- which is why having and admitting court “A few years ago, a friend told me about acter for honesty and veracity at issue. At trial, records regarding a felony conviction is so an Ann Landers column he read. You remem- defense counsel may call witnesses to testify important. ber Ann Landers, the lady who gave advice to their opinions that the employee is a dis- With the records admitted, opposing coun- on what to do. Apparently, someone had honest person or that she has a reputation for sel can respond that the felon-witness’s “hon- written that she could not find her brooch— being untruthful. These opinions are discov- esty” is nothing more than self-protection. For a one-of-a-kind pin that her family had passed erable pretrial. Defense counsel may not the felon-witness who admitted to stealing down for generations. Shockingly, she found admit at trial specific instances of the employ- money for food, the argument would look like it on a dresser at a friend’s house months ee’s conduct (other than felony convictions this: “Just like [the felon-witness] got caught after it had gone missing. The woman writ- reflecting on honesty and veracity). The stealing money, he got caught here with proof ing for advice remembered that her friend had Discovery Act, however, permits inquiry into that a jury convicted him of a crime. Honesty once commented on how much she liked and instances of dishonest conduct—even though had nothing to do with it then, and honesty wanted to buy it. ‘Dear Ann,’ she asked, they are inadmissible—if they are likely to lead to the discovery of admissible opinions and reputations. Defense counsel may ask other employees in depositions about specific instances in which the plaintiff-employee was less than completely honest. The answers could uncover other admissible, and embarrassing, evidence and may prompt the plaintiff-employee to settle the case. Certainly the Discovery Act does not permit attorneys unfettered inquiry into who a person is and what he or she has done. While the Discovery Act permits pretrial inquiries reasonably calculated to lead to the discovery of admissible evidence, the Evidence Code limits exploration into evidence of a “person’s general reputation” to the “relevant time in the community in which [the witness] then resided.…”42 The relevant time may encompass “a time prior to” the date on which the alleged offense or bad act occurred.43 However, these inquiries, whether probing reputation or opinion, are always subject to the trial court’s review and limitation.44 An effective way to attack character witnesses is to dig into the foundations of their testimony. The inquiry should include how well the character witness knows the other witness, or whether the character witness has any biases against, or a personal relationship with, the witness about whom the character witness is delivering an opinion. Strategically, this type of foundational ques- has nothing to do with it now. The jury ‘Should I confront her?’ Landers wisely wrote tioning should occur in front of the jury. instruction states: ‘You have heard that a back, ‘Don’t bother. If she is willing to steal witness in this trial has been convicted of a it, she is willing to lie about it.’” Felony Convictions at Trial felony. You were told about the conviction Counsel should then explain how what To defuse the impact of a cross-examining only to help you decide whether you should Ann Landers wrote applies to the lawsuit. attorney’s attack, felons testifying in trial believe the witness. You must not consider it “When you think about that witness, con- often admit convictions when opposing coun- for any other purpose.’”46 victed of a felony, ask yourself, ‘should I sel has the evidence to prove the convic- Some attorneys may find arguing the believe him?’ Then, remember what Ann tion.45 On direct examination, the felon-wit- felony conviction offers an irresistible oppor- Landers said. If someone is willing to steal, ness’s attorney will typically ask, in a tunity to extend the use and meaning of that she is also willing to lie. Theft and lying are rehearsed exchange, “Have you been con- conviction to suggest that the jury should acts of a dishonest person. Dishonest people victed of a crime?” The witness will answer not trust the witness because he or she is lie, especially under oath.” with something like, “Yes. I’m embarrassed immoral. The jury instruction, however, con- Some lawyers try to defuse the impending to say that, once when I was living out of my tains an implied warning: counsel should not attack on their felon-witness by asking the car, I stole some money from a liquor store suggest the court admitted the felony con- jury to give the witness credit for admitting so that I could eat.” In closing argument, viction for any purpose other than its impact that he or she had committed the felony. opposing counsel often argue that, by admit- on the witness’s honesty and veracity. They then make the same point in their clos- ting the conviction, the witness demonstrated Counsel should turn to an example that ing argument to the jury. This argument his or her honesty. Despite objection, courts brings the situation alive for jurors. They focuses on an inadmissible, specific instance

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of good conduct.47 Yet the only specific relating to character.54 The questions must during that time, without referring to the instance of conduct admissible to prove a appear in the same form as the evidence pre- fact that his reason for leaving was to live with character trait for honesty or veracity is the sented. Thus the question must seek evidence a minor girl. Similarly, nonsupport of his existence of a felony conviction, not the act of a reputation of bad character about which family during [his] incarceration could have of admitting to one. Opposing counsel should people in the community may speak: “Have been proved without reference to the move to bar this argument regarding good you heard rumors or reports that the defen- deceased’s conviction.…”65 Even if trial coun- conduct by a motion in limine. dant did [something dishonest]?” A lawyer sel is poised to win the opportunity to admit may even ask, “Have you heard [derogatory highly prejudicial evidence, he or she may Opinions and Reputations at Trial information] about the witness?” Advocates wish to consider preserving the case on appeal In trial, on direct examination of a character may not imply that the subject about which by not overreaching. Counsel opposing the witness, an attorney will usually begin by they ask is true,55 and they must ask the admission of character evidence may also asking, “Do you know the defendant?” questions in good faith.56 consider suggesting that the court sanitize Answer: “Yes.” “How long have you known the evidence if the court appears ready to him?” Answer: “[A number of] years.” “Have Excluding or Sanitizing admit the harmful evidence. you spent enough time with him to develop Courts must analyze the proffered evidence Trials are a search for the truth. Knowing an opinion about how truthful he is?” under Evidence Code Section 352 to ensure which witnesses testified truthfully, and which Answer: “Yes.” “Based on your interaction it will not take too much time, mislead the did not, is critical to getting to the truth of the with him, what is your opinion about how jury, or cause undue prejudice or too much matters at issue. Honest people tend to tell the truthful the defendant is?” Answer: “He is a confusion.57 In general, the evidence must truth, and dishonest people tend to lie. very honest guy.”48 be sufficiently recent. It can become “too Knowing when the rules of evidence permit On cross-examination, an attorney may remote [in time] to have any probative value” the discovery, and admission, of character question the character witness about wrong- and thus become irrelevant.58 Recent case evidence gives counsel a great advantage, doing of which the witness may not know. law suggests, however, that a felony convic- both at trial and pretrial. In many ways, The lawyer may ask do-you-know questions tion 17 years prior to the events at issue may character evidence is the sleeping giant of about conduct relating to character. For continue to have probative value as the basis civil litigation. ■ instance, after a character witness testifies for impeachment.59 Counsel may object to the that a party is honest and upstanding, the evidence under Section 352, and the trial 1 Beyda v. City of Los Angeles, 65 Cal. App. 4th 511, opposing lawyer could cross-examine by ask- court must then evaluate the evidence with the 518 (1998) (quoting 1A WIGMORE ON EVIDENCE §58.2, ing whether the witness knows that the party guidance of the Section 352 criteria.60 The at 1212 (Tillers rev. 1983)). 2 People v. McAlpin, 53 Cal. 3d 1289, 1305 (1991). had been arrested for auto theft. Still, the court need not articulate its reasoning on the 3 Megan Kurlychek, Robert Brame & Shawn Bushway, allowable questioning in this instance is lim- record, though the record must reveal that the Scarlet Letters and Recidivism: Does an Old Criminal ited: “It is elementary that the misconduct court weighed the factors in generating its Record Predict Future Offending?, CRIMINOLOGY & inquired of must be inconsistent with the conclusion.61 PUB. POL’Y 5:3:483-504 (2006). character traits attested to on direct.”49 If a court appears disinclined to permit 4 People v. Shoemaker, 135 Cal. App. 3d 442, 446–47 Asking a character witness whether he had character evidence, counsel may wish to san- (1982). 5 B.F. SKINNER, SCIENCE AND HUMAN BEHAVIOR 17 heard that a church had excommunicated itize it, by making the evidence less prejudi- (2005). 62 the party about whom he had testified is “not cial or inflammatory. If the evidence seems 6 See KENNETH S. BROUN, MCCORMICK ON EVIDENCE necessarily inconsistent” with the witness’s tes- “too good” to disregard, it is probably an easy §187 (Update 2006). timony that the defendant has a good repu- target for reversal on appeal. For example, a 7 People v. Willoughby, 164 Cal. App. 3d 1054, 1062 tation for “truth, honesty and integrity.”50 At family sued a telephone company for wrong- (1985). 8 Carr v. Pacific Tel. Co., 26 Cal. App. 3d 537, 544 moments like these, seemingly all of a sudden, ful death, claiming that the tension on tele- (1972); EVID. CODE §1100, Cal. Law Revision the prohibition on evidence of special phone wires flung a large piece of a cut tree Commission cmt. instances of conduct begins to dissolve, per- on to the decedent, who was also the fami- 9 The meanings of “honesty” and “veracity” are sim- mitting the opposing attorney to attack the ly’s financial provider.63 The trial court per- ilar but not identical. Honesty refers to truth telling. opinion for truthfulness with hints about evi- mitted the defendant to try to minimize the Veracity refers to a commitment to truth telling. See http://www.bartleby.com/61/33/T0393300.html; EVID. dence of conduct involving untruthfulness.51 damages it could owe the family by present- CODE §1101(c). Of course, the lawyer must ask the impeach- ing evidence that the decedent had had an 10 EVID. CODE §1106. ing questions in good faith52 and not suggest extramarital affair, and lived with, a 16-year- 11 Rules permitting character evidence are more relaxed evidence of misconduct that did not occur. old girl. He had also been imprisoned for in criminal practice compared to civil practice. See In trial, on direct examination of a char- two years for passing worthless checks. EVID. CODE §1101(c) (Character evidence may be used to impeach a witness.); EVID. CODE §782 (Character evi- acter witness, an attorney will ask, “Do you During these times, the decedent had not dence is admissible to show consent in prosecution for know the defendant?” Answer: “No, but I financially supported the family. The jury sexual misconduct.); EVID. CODE §1102 (A defendant have heard of him. “How long have you found for the defendant, but the court of may present evidence of his or her own good charac- known about him?” Answer: “I have heard appeal reversed the trial court’s judgment ter.); EVID. CODE §1103 (A defendant may attack the people talk about him for about five years.” finding this evidence unfairly prejudicial.64 victim’s character.); and EVID. CODE §1109 (Character “Have you spoken with others about his rep- The reviewing court reasoned that, while evidence is admissible in cases alleging domestic violence, including violence against children, and cases utation for honesty?” Answer: “Yes.” “What the defendant had the right to show that the alleging elder abuse or abuse of a dependent adult.). is your understanding of his reputation for decedent had not provided for the family for 12 EVID. CODE §§785, 786. Even the honesty and verac- honesty?” Answer: “He is a very honest periods of time, the reasons were “poten- ity of hearsay declarants can be at issue and thus guy.”53 Evidence in this form tends to be the tially inflammatory.” It hinted that the trial attacked. EVID. CODE §1202; People v. Jacobs, 78 Cal. least persuasive of the three types of charac- court could have sanitized the evidence: “It App. 4th 1444 (2000). 13 EVID. CODE §790. ter evidence and is easy to attack. would have been simple to establish that the 14 Id. On cross-examination, a lawyer may ask decedent left his wife and children for a 15 EVID. CODE §789. have-you-heard questions about conduct period…and did not provide for their support 16 EVID. CODE §§786–790, 1101(c).

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17 EVID. CODE §§800, 801; People v. Stoll, 49 Cal. 3d 1136, 1152 (1989). 18 People v. McAlpin, 53 Cal. 3d 1289, 1310 (1991). 19 People v. Zambrano, 124 Cal. App. 4th 228 (2004). 20 People v. Smith, 214 Cal. App. 3d 904, 915 (1989). 21 Stoll, 49 Cal. 3d at 1152; EVID. CODE §§800, 801. 22 EVID. CODE §787. 23 People v. McDaniel, 59 Cal. App. 2d 672, 676 (1943). 24 EVID. CODE §1324. 25 Pyper v. Jennings, 47 Cal. App. 623, 630 (1920). 26 EVID. CODE §786; Pyper, 47 Cal. App. at 630. 27 McDaniel, 59 Cal. App. 2d 672. 28 People v. McAlpin, 53 Cal. 3d 1289, 1310–11 (1991). 29 Michelson v. United States, 335 U.S. 469, 482-83 (1948). 30 EVID. CODE §787; Piscitelli v. Salesian Soc’y, 166 Cal. App. 4th 1 (2008). 31 EVID. CODE §788; Robbins v. Wong, 27 Cal. App. 4th 261 (1994); Piscitelli, 166 Cal. App. 4th 1. 32 Robbins, 27 Cal. App. 4th 261. 33 People v. Harris, 47 Cal. 3d 1047 (1989); People v. Castro, 38 Cal. 3d 301, 306 (1985). 34 People v. Miles, 172 Cal. App. 3d 474 (1985); People v. Abilez, 41 Cal. 4th 472 (2007); People v. Rodriguez, 5 Cal. 4th 1398, 1402 (1992); People v. Bonilla, 168 Cal. 3d 201 (1985). 35 EVID. CODE §788. 36 CODE CIV. PROC. §2017.010. 37 EVID. CODE §1101(a), (b). 38 Johnson v. United Cerebral Palsy/Spastic Children’s Found. of L.A., 173 Cal. App. 4th 740, 763-67 (2009). 39 Piscitelli v. Salesian Soc’y, 166 Cal. App. 4th 1, 9 (2008). 40 EVID. CODE §1101(b) (Evidence is admissible if it is “relevant to prove some fact []such as motive, opportunity, intent, preparation, plan, knowledge, identity, absence of mistake or accident.…”). See Phillip R. Maltin & Michael D. Schwartz, Second Acts, LOS ANGELES LAWYER, June 2004, at 31. 41 EVID. CODE §786. 42 EVID. CODE §1324. 43 People v. Fernandez, 222 Cal. App. 2d 760, 766 (1963), disapproved on other grounds, People v. In this case, the grass Wetmore, 22 Cal. 3d 318, 324 (1978). 44 CODE CIV. PROC. §§2017.010, 2025.420(b). 45 The evidence usually takes the form of certified really is greener. records from the clerk of the court. 46 CACI 211. At a time when most companies are cutting back, Northwestern 47 EVID. CODE §787. 48 See 1 MCCORMICK ON EVIDENCE §43 (6th ed.). Mutual has added a record number of Financial Representatives 49 People v. Marsh, 58 Cal. 2d 732, 745 (1962). to its sales force in 2009 and has yet to slow down in 2010. If 50 Id. you have the drive and talent to succeed, contact us. 51 People v. Hurd, 5 Cal. App. 3d 865, 877–81 (1970). 52 People v. Eli, 66 Cal. 2d 63, 79 (1967). Named one of the “Best Places to Launch a Career” 53 See 1 MCCORMICK ON EVIDENCE §43 (6th ed.). -BusinessWeek, September 2009 54 Thornton v. Rhoden, 245 Cal. App. 2d 80, 85 (1966). Ranked one of the “Training Top 125” 55 Marsh, 58 Cal. 2d at 745. -Training magazine, February 2010 56 Eli, 66 Cal. 2d at 79. 57 Robbins v. Wong, 27 Cal. App. 4th 261, 271 (1994); People v. Clair, 2 Cal. 4th 629, 654 (1992); People v. Castro, 38 Cal. 3d 301 (1985). 58 People v. Shoemaker, 135 Cal. App. 3d 442, 448, n.4 (1982). Woodland Hills - Encino 59 Piscitelli v. Salesian Soc’y, 166 Cal. App. 4th 1, 10 (2008). (818) 887 - 9191 60 Robbins, 27 Cal. App. 4th at 274. www.northwesternmutual.com 61 Michail v. Fluor Mining & Metals, Inc., 180 Cal. App. 3d 284, 287 (1986). 62 See Carr v. Paciﬁc Tel., 26 Cal. App. 3d 537, 545 (1972). 05-3008 The Northwestern Mutual Life Insurance Company, Milwaukee, WI (Northwestern Mutual). Mitchell Craig Beer is a General Agent of Northwestern 63 Id. Mutual (life and disability insurance, annuities) and a Registered Representative and Investment Adviser Representative of Northwestern Mutual Investment 64 Services, LLC (securities), a subsidiary of Northwestern Mutual, broker-dealer, registered investment adviser and member FINRA and SIPC. Certified Financial Id. at 545-46. Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNERTM and CFP (with flame logo)®, which it awards to individuals 65 Id. who successfully complete initial and ongoing certification requirements. “Best Places to Launch a Career” September 2009. “Training Top 125” February 2010.

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by Howard S. Klein PARTING OF THE WAYS Clients contemplating divorce need to consider revision of their estate plans

FAMILY LAW attorneys are well versed in looking to protect his or her assets prior to must be adhered to when evaluating changes divorce, and estate planning practitioners in dissolution is in an unusual position. While to the character of marital property. death, but too often, family law attorneys do the constraints of the standard (or automatic) For example, estate planners may trans- not give adequate consideration to estate temporary restraining orders are not applic- fer or recharacterize property though a trans- plans before, during, or after filing for dis- able until dissolution is initiated, his or her mutation, as described by Family Code solution. Similarly, estate planning practi- actions are subject to the interspousal fidu- Section 850 et seq. A transmutation often tioners may not contemplate the consequences ciary duties described under Family Code drafted by estate planners involves changing of a marital dissolution on the estate plans of Section 721.1 Thus, asset protection and one spouse’s separate property to community clients. Attorneys of both specialties must estate planning in the predissolution stage property in order to achieve an increase in prepare for the intersection of family law must adhere to the rules governing fiduciary basis of real property upon the death of either and estate planning. Estate planners need to relationships. spouse2 or to equalize the estate between inform their clients that dissolution of mar- The interspousal fiduciary duties imposed husband and wife. Although this transfer riage often renders a previously prepared under Family Code Section 721 provide that, offers advantages in estate planning, it pre- estate plan ineffective and the marital assets in transactions with each other, a husband and sents a significant disadvantage in divorce to subject to the laws of intestate succession. wife are subject to the general rules govern- the spouse who gave away half of his or her Likewise, family lawyers need to recognize ing fiduciary relationships that control the that protection of a divorcing client’s prop- actions of a person in a confidential rela- Howard S. Klein, a certified specialist in estate erty involves ensuring that the client’s estate tionship. This relationship imposes a duty planning, trust, and probate law, heads the Probate planning needs are met before, during, and of the highest good faith and fair dealing, and Department at Feinberg, Mindel, Brandt & Klein, after the dissolution. neither spouse may take unfair advantage of LLP in West Los Angeles, where he specializes in Marriage or a registered domestic part- the other. Further, the law obliges spouses to probate and family law crossover matters. The nership imposes fiduciary duties on the part- make full and fair disclosure of financial author acknowledges the contributions of his

ners. A spouse or domestic partner who is information to each other. These standards associate, Taylor Bouchard. RON OVERMYER

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separate property. • Postnuptial agreement. A postnuptial other party before the change takes effect In addition, when only one spouse bene- agreement is essentially a different label for (see “Revocation of a Family Trust without fits from an interspousal transaction, the law a transmutation agreement and must there- the Knowledge of the Cotrustee” by Kira presumes that the transaction was the prod- fore comply with the applicable statutes and Masteller, page 16), 3) elimination of a right uct of undue influence. Once that presump- cases. A severability clause may be an impor- of survivorship to property, typically by sev- tion arises, the advantaged party has the bur- tant provision in this type of agreement, so ering joint tenancy, provided that notice of the den to prove that the disadvantaged party was that the entire agreement is not void in the change is filed and served before the change not unduly influenced. In re Marriage of event that a particular provision is deemed takes effect, 4) creation of an unfunded revo- Delaney3 sets forth the elements that the invalid. cable or irrevocable trust, and 5) execution advantaged spouse must establish to prove • Creation of a separate property trust. This and filing of a disclaimer. that no undue influence was used in a trans- trust will enable the settlor of the trust to Pursuant to Section 2040(b)(2), a client mutation. First, the transmutation must have maintain the separate property character of may revoke a nonprobate transfer so long as been freely and voluntarily made by the dis- certain assets free from the common pitfalls it does not affect the disposition of property. advantaged spouse. Second, the disadvan- of commingling or enhancement with com- Otherwise, the revocation would violate the taged spouse must have had full knowledge munity property funds. ATROs. An example of an estate planning of all the facts. Third, the disadvantaged tool that successfully avoids violation of spouse must have had a complete under- During Divorce Proceedings Family Code Section 2040(a)(4)—which pro- standing of the effect of the transmutation. Whether or not new instruments are necessary hibits nonprobate transfers that affect the These rigorous standards of fiduciary duty or appropriate, an estate planner will need to disposition of property, and at the same time, and undue influence leave little room for dis- deal with standard (or automatic) tempo- is within the exemption of Family Code honesty in estate planning before a divorce. rary restraining orders. Commonly known as Section 2040(b)(2)—is naming a new trustee Once clients who are planning divorce have ATROs, they bind the petitioner upon filing or successor trustee. In Estate of Khan,7 the been advised of their fiduciary obligations as the petition for dissolution and issuance of court found the husband’s attempt to revoke spouses, however, they may still benefit from summons, and the respondent upon service.5 a trust while engaged in dissolution litigation a review of their estate plans with an eye not For estate planners, the critical ATRO pro- represented an attempt by him to transmute toward death but divorce, as the example of visions are those that preclude any transfer, community property into separate property transmutation to community property shows. encumbrance, or disposal of community or in violation of an existing restraining order. The end of community property acquisi- separate property without the written consent Specifically, the court held that because the tions is marked by the date of separation, as of the other party or order of court, except trust was created jointly, the husband acting provided for under Family Code Section 771. in the usual course of business or for neces- alone could not revoke it. Normally, under Separation allows for the accumulation of sities of life. Family Code Section 2040(b), a spouse may separate property but does not terminate the Standard provisions also preclude cash- revoke such an instrument, but if the revoca- duty of highest good faith and fair dealing ing, borrowing against, canceling, transfer- tion clauses of the trust agreement utilize lan- owed to one’s spouse. This critical date is ring, or changing the beneficiaries of any guage in the plural (e.g., “us”), the agreement determined by the intent of one spouse to end insurance policy or other coverage. In addi- is controlling, and both spouses must mutually the marriage, coupled with the objective con- tion, they preclude creating a nonprobate agree to the revocation. In contrast, a spouse duct of furthering that intent.4 In Family transfer or modifying a nonprobate transfer may not change the beneficiary of a nonpro- Code Section 2100(a), the California in a manner that affects the disposition of bate transfer because that would affect the Legislature has promulgated its policy to property subject to the transfer without the disposition of property and violate the ATROs. “marshal, preserve, and protect community written consent of the other party or order Subsection 2040(3) allows a party to a dis- and quasi-community assets and liabilities of the court. “Nonprobate transfer” is solution action to eliminate a right of sur- that exist at the date of separation so as to defined by Family Code Section 2040(d)(1) vivorship to property. This subdivision was avoid dissipation of the community estate as an instrument other than a will that trans- the product of a 2001 amendment that sought before distribution.” In line with this policy, fers property on death, including revocable to make the section consistent with the hold- Family Code Section 2102(a) expressly living trusts, payable on death accounts, ing in Estate of Mitchell.8 In Mitchell, a hus- extends a spouse’s fiduciary duties from the Totten trusts, and similar items. band and wife held property as joint ten- date of separation to the date of distribu- Pursuant to Family Code Section 233, ants. When the couple initiated dissolution tion. An estate planner must recognize that, these restraining orders remain in effect until proceedings, the husband recorded declara- while the date of separation triggers the end final judgment of dissolution is entered. A tions of severance pursuant to Civil Code of the accumulation of community property spouse who violates one of the ATROs is in Section 683.2(a)(2) in order to terminate the assets, it does not end a spouse’s fiduciary contempt of court, and the aggrieved spouse joint tenancy and end the right of survivor- duties with regard to all marital assets of is entitled to restitution in the amount that ship. About a month later, while the disso- whatever character. would have been realized had the asset been lution proceeding was still pending, the hus- An estate planner may consider several available at the finalization of dissolution.6 band died. The court held that “when one means of protecting the character of a spouse’s Notwithstanding the ATROs, Family spouse severs a joint tenancy with the other property while maintaining compliance with Code Section 2040(b) expressly reserves the spouse by executing and recording a decla- a spouse’s fiduciary duties: right of a spouse to make certain estate plan- ration of severance, there is neither a trans- • A temporary or conditional will. This instru- ning changes during dissolution proceedings, fer nor a disposition of any property. Such a ment is almost always a sound idea, whether providing these exemptions from the ATROs: severance therefore does not violate an injunc- to change the existing will or, on the other 1) creation, modification, or revocation of a tive order entered pursuant to Family Code hand, to republish the existing will in light of will, 2) revocation of a nonprobate transfer, Section 2040.”9 The code section allows for Probate Code Section 6122(a), which revokes most notably a revocable living trust pur- such a severance with the added requirement existing wills on dissolution unless the will suant to the trust instrument, provided that that notice of the change is filed and served on expressly provides otherwise. notice of the change is filed and served on the the other party before the change takes effect.

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• Marital Dissolution

• Spousal and Child Support Exclusively Family Law

• Custody and Visitation Peter M. Walzer is the founding partner of Walzer & Melcher LLP. He is past President of the Southern California Chapter of the American • Business Academy of Matrimonial Lawyers. He is former chair of the State Bar of California Association of Valuation Certified Family Law Specialists.

• Pension Distributions Christopher C. Melcher earned his law degree at Pepperdine University, and was admitted to the • Tax Issues California bar in 1994. His practice focuses on complex family law litigation and the preparation in Marital of premarital agreements. He is a certified family Dissolutions law specialist and a member of the Family Law Executive Committee of the State Bar of California. He is a regular lecturer on family law • Interstate and issues statewide, and the author of several family law publications. International Family Law Leena S. Hingnikar received a Bachelor of Arts Disputes Degree in 2003 from the University of California, San Diego. She received her Juris Doctor from Whittier Law School in 2007. She presented a • Bankruptcy and program on family law and estate planning issues. Divorce

• Paternity Jennifer L. Musika received a Bachelor of Arts Degree in 2005 from Vanderbilt University. She received her Juris Doctor from Boston University Law School in 2008. She gave a State Bar webinar on preparing initial pleadings in a divorce action.

Los Angeles and Ventura Counties 21700 Oxnard Street, Suite 2080,Woodland Hills, California 91367 Telephone (818) 591-3700 · Fax (818) 591-3774

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The case of Allstate Life Insurance v. because of the ATROs, the execution of the Another option is to create an unfunded Dall10 is an example of the interplay between marital settlement agreement exercised one of trust that serves as a receptacle for property, the ATROs and the estate planning changes the exempt estate planning changes, thereby subject to a pour-over provision in a newly expressly permitted pendente lite. In Allstate, effectuating the change in beneficiary. drafted will.11 The unfunded trust and the a husband purchased a life insurance policy Together, the standard ATROs and the pour-over do not violate the ATROs. during the marriage naming his wife as the permissible actions listed under Family Code However, if the client dies during the pro- primary beneficiary and his sons as equal Section 2040(b) offer guidance when repre- ceedings, his or her will adds to the new trust contingent beneficiaries. Several years later, the senting a client who is in dissolution pro- all assets belonging to the client that were for- wife filed for dissolution, and the filing sub- ceedings. Possible steps to take include a new merly in the revoked trust, together with the jected the parties to the ATROs. On February will that revokes the former will and desig- client’s share of the joint tenancy, payable-on- 21, 2007, the husband and wife signed a nates a different executor and new benefi- death accounts, and similar assets over which marital settlement agreement, with each ciaries. Although the final judgment will he or she acquired the right of testamentary spouse waiving respective rights as benefi- revoke the former spouse’s share of the dece- disposition. While these assets would have ciaries to life insurance policies. The judgment dent’s estate, this automatic revocation does to be administered in the decedent’s probate was not entered until April 20. Before entry not take place until the entry of the judgment. estate, at least they would pass to the client’s of final judgment, Allstate Insurance received So, as a precaution, an estate planner should desired beneficiaries and would be under the husband’s request for a beneficiary change. On advise the client to revoke his or her will as stewardship of the client’s desired fiduciaries. July 5, the husband died. The court found that early as the filing of the petition. The family court is likely to scrutinize the ATROs remained in effect until April 20, Additional steps to take include revoking these transactions for compliance with the when the trial court issued its final order. an existing living trust (after providing the fiduciary duties of Family Code Section 721. Because the husband was enjoined from sub- requisite notice) and then returning the revoked But they are permissible within the language mitting a change of beneficiary form until trust’s assets to the parties; severing any joint of Family Code Section 2040. They do not after April 20, the April 4 request had no legal tenancies (after providing the requisite notice) affect the status quo of the marital assets effect. However, since the wife disclaimed so that the parties hold the subject property as during the pendency of the family court pro- her interest under the marital settlement tenants in common, with each party having tes- ceedings.12 As a protective measure, an attor- agreement, as permitted by Family Code tamentary power over his or her half share; and ney may seek a court order. This is a viable Section 2040(b)(5), the sons, as equal con- terminating payable-on-death accounts (after option under Family Code Section 2040(a)(2). tingent beneficiaries, became the sole benefi- providing the requisite notice) so that the sur- If certain estate planning devices cannot be ciaries of the life insurance policy. So, viving spouse is not the beneficiary of the implemented until final judgment is entered although the husband was unable to change accounts in the event of the other spouse’s and the risk of death before final judgment is the beneficiary designation when he did death during dissolution proceedings. high, court intervention is appropriate. ATROs are boilerplate, one-size-fits-all orders, so they may be appropriate for modification when the unique circumstances of a family so THE LAW OFFICES OF demand. A court has the inherent power to modify an injunction when “the ends of jus- Vincent W. Davis & Associates tice would be served by modification.”13 LITIGATORS: FAMILY LAW, PROBATE, CIVIL, CRIMINAL, After the Dissolution LABOR AND IMMIGRATION The entry of a marital dissolution judgment automatically revokes all testamentary distributions to, and appointments of, the for- TEL 866.893.4529 | 626.446.6442 | FAX 626.446.6454 mer spouse. This automatic revocation may well create an intestacy, and at the very least www.vincentwdavis.com it will leave large holes in the estate plan of the newly divorced spouse. Typically, the 150 NORTH SANTA ANITA AVENUE, SUITE 200, ARCADIA, CALIFORNIA 91006 purpose of the previously created estate plan is frustrated or rendered ineffective as a result of a divorce. The automatic revocation of certain testamentary distributions is effectu- ated through Probate Code Sections 612214 MINA N. SIRKIN, ESQ. and 5600. As to estate plans involving a transfer CERTIFIED SPECIALIST ATTORNEY IN ESTATE PLANNING, PROBATE & TRUST LAW BY THE BOARD OF LEGAL other than by will, Probate Code Section SPECIALIZATION OF THE STATE BAR OF CALIFORNIA 5600(a) provides that “a nonprobate transfer to the transferor’s former spouse, in an instrument executed by the transferor before or Trust & Probate Litigation, Special Needs Trusts & during the marriage, fails, if, at the time of the Structured Settlements transferor’s death, the former spouse is not the tel 818-340-4479 • email [email protected] transferor’s surviving spouse…as a result of the www.SirkinLaw.com dissolution or annulment of the marriage.…” The exceptions to Section 5600(a)’s caus- 21550 OXNARD STREET, THIRD FLOOR, WOODLAND HILLS, CALIFORNIA 91367 ing of a nonprobate transfer to fail are any of the following: 1) the nonprobate transfer is

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not subject to revocation by the transferor at tic partner in the wings, a dissolution is also property stocks pendente lite and used the proceeds to the time of the transferor’s death, 2) there is the time for the client to give serious consid- pay community debt. His wife was awarded 50% interest in lost profits.). clear and convincing evidence that the trans- eration to the preparation of a premarital 7 Estate of Khan, 168 Cal. App. 3d 270 (1985). feror intended to preserve the nonprobate agreement, in order to preserve the separate 8 Estate of Mitchell, 76 Cal. App. 4th 1378 (1999). transfer to the former spouse, or 3) a court character of his or her existing assets, to 9 Id. order that the nonprobate transfer be main- determine the character of new earnings, and 10 Allstate Life Ins. v. Dall, 2009 U.S. Dist. LEXIS tained on behalf of the former spouse is in to handle such matters as spousal support and 100401 (E.D. Cal. Oct. 27, 2009). 11 effect at the time of the transferor’s death.15 succession to property on death. Also, it is This technique is suggested in Estate Planning During Marital Dissolution, 30 CAL. L. REVISION COMM’N Although a client may feel secure in his or important for the client to create a new will REPORTS 603 (2000). her knowledge that the judgment for disso- that sets forth the testator’s intention to pro- 12 See Howard S. Klein, Tales of Two Courts, LOS lution will operate to ensure that the former vide for (or not to provide for) his or her sig- ANGELES LAWYER, Apr. 2005, at 29. spouse receives nothing from the estate, the nificant other.16 While divorce is not as cer- 13 See CODE CIV. PROC. §533, as cited in Estate of judgment simultaneously functions to create tain as death, preparing for the complexities Ronald D. Fuller, 2005 Unpublished LEXIS 3380 (1st Dist. Div. 1 Apr. 18, 2005). gaps in an estate plan, possibly defeating the surrounding the intersection of divorce, death, 14 “Unless the will expressly provides otherwise, if efficiency of the plan and even resulting in an and disposition of property enable an estate after executing a will the testator’s marriage is dissolved intestacy. A client should not rely solely upon plan to remain effective. ■ or annulled, the dissolution or annulment revokes all the statutory revocations and should instead of the following: (1) any disposition or appointment of property made by the will of the former spouse; (2) any work with an estate planner to revise all ben- 1 California law recognizes registered domestic partners provision of the will conferring a general or special eficiary designations in order to ensure that as well as spouses. FAM. CODE §297.5(a). Similarly, the power of appointment on the former spouse; and (3) Probate Code has been amended to provide for domes- the client’s estate plan will meet current needs. any provision of the will nominating the former spouse tic partners or domestic partnerships as a logical ana- Estate planning attorneys should advise a as executor, trustee, conservator or guardian.” PROB. log to statutes mentioning spouses and marriage. See, CODE §6122(a). newly divorced spouse to create appropri- e.g., PROB. CODE. §§6401, 6122.1. 15 PROB. CODE §5600(b). ate estate planning documents, such as a new 2 See I.R.C. §1014(b)(6). 16 If a decedent should elect not to provide for his or her revocable living trust, pour-over will, trust 3 In re Marriage of Delaney, 111 Cal. App. 4th 624 spouse in his or her will or living trust, Probate Code (2003). transfer deeds, assignment of assets, power of §21610 will provide for the omitted spouse in the dece- 4 Marriage of Hardin, 38 Cal. App. 4th 448, 451 attorney, and advance healthcare directive. dent’s estate unless one of three circumstances apply: 1) (1995). the failure to provide was intentional and that intention When that is accomplished, the client will at 5 See FAM. CODE §§2040(a), 231, and 233; Judicial appears from the testamentary instruments, 2) the dece- least have provided for the most important Council Form FL-110. dent provided for the spouse by transfer outside of the persons in his or her life and will have a 6 This restitution remedy is similar to the Family Code estate passing by the testamentary instruments, or 3) the §1101(g) remedy for breach of a spouse’s fiduciary health directive in place. spouse made a valid agreement waiving the right to duty. See Marriage of McTiernan & Dubrow, 133 Cal. If the client has a new spouse or domes- share in the decedent’s estate. PROB. CODE §21611. App. 4th 1090 (2005) (A husband sold community

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MCLE ARTICLE AND SELF-ASSESSMENT TEST By reading this article and answering the accompanying test questions, you can earn one MCLE credit. To apply for credit, please follow the instructions on the test answer sheet on page 43. ScreenG The marketplace, rather than the courthouse, may determine

IN JULY 2008, Facebook brought a knockoffs and preserve hard-earned goodwill. directional layout in a given space, whether trade dress infringement suit in the Northern Businesses will always be able to pro- that space is a sheet of paper or a screen of District of California against a German Web tect the trademarks, trade names, and copy- space meant for information displayed digi- site, StudiVZ, that had allegedly copied rightable text content (images, music, and tally.”10 In its circular “Copyright Registration Facebook’s “look, feel, features and ser- the like) contained on their Web sites. for Online Works,” the Copyright Office vices.”1 On the same day the California suit Nevertheless, as companies invest more time offers advice for those filling out applica- was filed, StudiVZ brought an action in and capital in the layout, user interface, and tions to register Web sites: Germany seeking a declaratory judgment overall appearance of their sites—and as Use terms that clearly refer to copy- that it had not infringed Facebook’s site. consumers increasingly come to associate rightable authorship [such as]…“text,” Various online media outlets branded StudiVZ distinctive Web site design (such as cnn.com “compilation,” “music,” “artwork” a “blatant Facebook clone,” an “exact dupli- and espn.com) with their favorite brands— “photography,” “motion picture/ audio- cate,” and a “direct rip-off.”2 One of the need to protect Web site look and feel visual”…or “sound recording”.…Do StudiVZ’s founders publicly admitted bas- becomes a priority. This protection can be not use terms that refer to elements ing the site on Facebook.3 rooted in either copyright or trademark law. that are not protected by copyright or Facebook’s California complaint howled To be worthy of copyright protection, the may be ambiguous, for example, “web- with outrage at StudiVZ’s “unabashed and look and feel of a Web site must be “original” site,” “interface,” “format,” “layout,” wholesale theft of Facebook’s user interface and possess some “minimal degree of cre- “design,” “look of website,” “letter- and webpage designs” and announced in its ativity.”7 These standards may seem low, but ing,” “game,” or “concept.”11 opening sentence, “This is a case to stop there are only a finite number of ways a Web Left unanswered by the Copyright Office Defendants from running a knockoff of site can be presented and over 200 million circular is whether terms such as “website,” Facebook’s website.”4 Yet, just one year later, Web sites on the Internet.8 As a threshold mat- “interface,” “design,” and “look of website” the world’s second most popular Web site5 ter, a copyright infringement lawsuit cannot are problematic because they are not pro- lost its case in Germany and quietly dismissed proceed unless and until the claimant has tected by copyright or simply because they are its California lawsuit, agreeing to allow applied to the U.S. Copyright Office for reg- ambiguous. StudiVZ to continue operating in exchange istration of the copyright at issue.9 Thus, the for an undisclosed cash settlement.6 Copyright Office is the first arbiter of whether Virtually Identical The story of how mighty Facebook found a Web site’s look and feel is sufficiently orig- Case law on the point is scant but seems to itself unable to shut down a reportedly “bla- inal and creative. However, its pronounce- indicate that the “look” or “design” of a tant” knockoff speaks volumes about the ments on the subject cast some doubt on Web site may qualify for copyright registra- legal and practical challenges faced by those whether Web site look and feel can ever be tion so long as the particular arrangement of seeking to protect a Web site’s “look and copyrightable. Web content is unique and creative. In Darden feel.” Despite those challenges, however, real The Copyright Office has stated that “in v. Peters, an applicant for copyright regis- benefits may arise from look-and-feel litiga- general, formatting of web pages is not copy- tration sought the district court’s review of the tion. The Facebook story demonstrates the rightable” and “[our] longstanding prac- Copyright Office’s denial of registration of the critical role look-and-feel claims can play in tice…is to deny registration of the arrange- “formatting of an Internet web page.”12 The a broader business strategy to defend against ment of elements on the basis of physical or Web site in question, appraisers.com, pre-

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by Kevin D. Hughes and David E. Rosen Grabbing e the ultimate winner in Web site infringement battles

sented a map of the United States highlight- vided that the way in which the site content requires proof that the allegedly infringing ing each state and county. Users could click is arranged is unique and creative. work is “virtually identical.”24 on a particular county to access the list of real If registration is secured for a Web site’s The “virtually identical” standard is as estate appraisers working there. look and feel, the copyright holder not only unforgiving as it sounds. In Crown Awards, The applicant sought a copyright for the may bring suit but also enjoys a rebuttable Inc. v. Trophy Depot, the plaintiff produced “formatting of an Internet web page.” The presumption that the copyright is valid.20 In undisputed evidence that the defendant had Copyright Office found this wording too response, the defendant must prove that the intentionally copied its Web site.25 broad, reasoning that the language could look and feel of the site at issue is neither orig- Nevertheless, the defendant also tweaked the include “unoriginal formatting elements” inal nor creative.21 The design’s originality can look and feel of the knockoff site by chang- and “uncreative layout of those elements.”13 be attacked by presenting evidence that other ing the color scheme from the original and by The Copyright Office acknowledged that the Web sites used aspects of the plaintiff’s design adding text in places where the original Web way in which “speciﬁc textual,…graphic or before the plaintiff did. Web archive services site did not.26 The Web sites were similar pictorial matter” had been “selected, coor- can supply historical screenshots of Web but not identical, and so the plaintiff’s claim dinated and arranged” might be worthy of pages to prove prior use of creative ele- was denied.27 copyright protection, but it refused to grant ments22—and this evidence can be quite effec- Unfortunately, Facebook v. StudiVZ did registration unless a more limited applica- tive in attacking claims of originality. not clarify the issues surrounding copyright tion was submitted.14 However, the appli- To prove infringement, the Web site owner protection for Web site look and feel. cant did not do so, and the issue was left must also prove “copying,” which in the Facebook asserted eight separate causes of unresolved.15 The district court granted sum- Ninth Circuit is generally established by evi- action, but copyright infringement was not mary judgment on the grounds that the dence of 1) the defendant’s access to the copy- among them.28 It is not clear why Facebook Copyright Office’s denial of registration was righted work prior to the creation of the chose this strategy. Maybe Facebook con- not an abuse of its discretion.16 defendant’s work, and 2) substantial simi- cluded that too little of its own design was In Mortgage Market Guide, LLC v. Freed- larity of general ideas and expression between original or that StudiVZ’s tweaks—for exam- man Report, LLC,17 the Copyright Office the copyrighted work and the defendant’s ple, using the color red where Facebook used had granted registration of the plaintiff Web work.23 Given the vast, wide-open nature of blue—meant the sites were no longer virtu- site’s “[c]ompilation [of] text, graphs, charts, the Internet, a defendant is unlikely to dispute ally identical. Still, Facebook might have tables and artwork relating to the mortgage his or her access to a given Web site. However, been expected to at least plead the claim. market.”18 After a 15-day bench trial, the dis- in the context of Web site look and feel, the Perhaps it simply had not registered its look trict court concluded that the plaintiff held a plaintiff will be required to meet a higher and feel with the Copyright Office and was valid copyright in the Web site and that the standard than substantial similarity. When a concerned that an application would be site’s interface “customization options” com- work’s copyright protection is limited to the bined with “the arrangement of dynamic originality and creativity of the particular Kevin D. Hughes is a partner and David E. Rosen is charts and tables” to form a “unique cre- “arrangement” of its elements—as is the case an associate with Tisdale & Nicholson, LLP, in ative expression.”19 Like Darden, this case with a Web site’s look and feel—copyright law Century City. Hughes and Rosen are copyright and acknowledges the potential for copyright reg- requires more than substantial similarity to trademark litigators who focus their practice on istration of a Web site’s look and feel, pro- prove infringement. Instead, the Ninth Circuit entertainment and Internet cases.

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denied. In any event, Facebook’s decision arbitrary embellishment.” acquired secondary meaning.45 A product not to plead copyright infringement speaks Even if individual elements of trade dress design feature acquires secondary meaning volumes about the difficulty of supporting have a functional utility, the arrangement or when its “primary signiﬁcance” in the minds such a claim in a case involving Web site combination of those utilitarian features may of prospective purchasers serves to identify look and feel. be protected as trade dress—but only if they the source or maker of the product.46 reflect arbitrary or nonfunctional “design Examples of trade dress that have acquired Trade Dress decisions” and leave a “multitude of alter- secondary meaning through use and adver- Trademark law could provide another avenue natives” for competing arrangements that tising include the Rubik’s Cube47 and the for those seeking protection for Web site are not confusingly similar.40 In Clicks small red tag stitched on to the back pocket look and feel. More specifically, plaintiffs Billiards, Inc. v. Sixshooters, Inc., the Ninth of Levi jeans.48

may invoke the form of trademark protection Circuit held that while many of the individ- Some of the factors that courts consider known as trade dress, which applies to the ual elements of the plaintiff’s pool hall were when evaluating secondary meaning include: “total image and overall appearance” of a functional (such as lamps to illuminate the • Whether consumers in the relevant market product.29 The theory behind trade dress pool tables and rails for the customers to associate the trade dress with the maker. protection is that a product deserves trade- place their drinks), the plaintiff had offered • The degree and manner of advertising under mark protection if its overall image is suffi- sufficient evidence of the “arbitrariness and the claimed trade dress. ciently distinctive that consumers associate non-functional nature of [the] design decisions • The length and manner of use of the claimed that image with the maker of the product.30 and the availability of alternative designs” to trade dress. Examples include the hourglass shape of the avoid summary judgment.41 The “arbitrary” • Whether use of the claimed trade dress has classic Coca-Cola bottle;31 the cow-spotted elements of the pool hall’s trade dress included been exclusive. boxes of Gateway computers;32 the décor of the “size, placement, and layout of the pool • Evidence of sales, advertising, and promo- the Taco Cabana chain of Mexican restau- tables; the color combination, including the tional activities. rants;33 the size, shape, and graphic design of contrast between the carpet and the dark • Unsolicited media coverage of the product. Reader’s Digest magazine;34 and the charac- wood; the lighting; the neon beer signs…[and] • Attempts to plagiarize the trade dress.49 ters and design features used in the Pac-Man the selection of video games.”42 Those seeking protection for a Web site’s video game.35 Unlike copyright, trade dress To date, only one opinion—and it is look and feel will find that many of these fac- does not require registration, originality, or unpublished—has addressed functionality in tors simply do not apply in that context. creativity.36 Recently, commentators and lit- the context of a Web site’s look and feel. SG Indeed, Web sites generally do not advertise igants, including Facebook, have sought to Services, Inc. v. God’s Girls Inc. involved the their look and feel. Also, the type of long- extend trade dress protection to a Web site’s creator of a so-called alterna-porn Web site, standing use that supports a likelihood of distinctive look and feel.37 suicidegirls.com, which featured news, mes- secondary meaning is typically measured in To sustain a claim for trade dress infringe- sage boards, interviews, and photographs of decades,50 while most Web sites are relatively ment, a Web site owner must prove that: clothed and nude models. The owner of this recent creations—and even established Web 1) Its design is nonfunctional. site sued a rival Web site, godsgirls.com, for sites revamp their look and feel every year or 2) Its design has acquired “secondary mean- trade dress infringement.43 While the court so. Moreover, sales are a poor indicator of ing.” ultimately dismissed the infringement claim brand recognition for the many sites that 3) The knockoff Web site creates a “likelihood on summary judgment, it did conclude that provide content and services for free. Adver- of confusion” in the mind of the consuming the colors of the plaintiff’s site (predomi- tising may ultimately make sense as a sub- public as to the source, sponsor, or maker of nantly pink) and the phrases used on the site stitute for sales, but no court has embraced the allegedly infringing site.38 (“they’re the girl next door” and “so you that approach thus far. A product feature is “functional” if it is wanna be a suicide girl?”) were nonfunc- To date, no court has held that a Web useful or serves a purpose that constitutes tional because they were “merely adornment site’s look and feel has acquired secondary “the actual benefit the consumer wishes to and do not ‘constitute the actual benefit that meaning. In Computer Access Technology purchase” rather than a “mere arbitrary the consumer wishes to purchase’.”44 Thus, Corporation v. Catalyst Enterprises, Inc., the embellishment.”39 For example, the hyper- existing case law leaves open the possibility plaintiff claimed that its computer software text links on cnn.com that allow a user to that a Web site’s look and feel could be ruled graphic user interface—akin to a Web site’s access news stories are “the actual benefit” nonfunctional, but the law is too undeveloped look and feel—was protectable trade dress.51 the user seeks from the site, but the color to draw any further conclusions. The court acknowledged that the plaintiff scheme and particular arrangement of stories, The far more difficult trade dress hurdle had spent $4.9 million on an advertising

KEN CORRAL images, and subjects are arguably “mere is proving that the Web site design has campaign aimed at creating identiﬁcation of

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MCLE Test No. 193 MCLE Answer Sheet #193 SCREEN GRABBING

The Los Angeles County Bar Association certiﬁes that this activity has been approved for Minimum Name Continuing Legal Education credit by the State Bar of California in the amount of 1 hour. Law Firm/Organization

1. The “look and feel” of a Web site must be nonfunc- C. None of the above. Address tional and distinctive to be worthy of copyright pro- D. A and B. tection. 11. A product design feature acquires secondary mean- City True. ing when its secondary significance in the minds of State/Zip False. prospective purchasers serves to identify the source or E-mail The U.S. Copyright Office has stated publicly that the maker of the product. 2. Phone formatting of Web pages generally is not copyrightable. True. True. False. State Bar # False. 12. To prove secondary meaning, a Web site owner 3. Web site owners may not bring a look-and-feel copy- must present evidence that the general public associ- INSTRUCTIONS FOR OBTAINING MCLE CREDITS right infringement suit until they have first applied for ates the look and feel of the site with its owner. 1. Study the MCLE article in this issue. copyright registration. True. 2. Answer the test questions opposite by marking True. False. the appropriate boxes below. Each question False. 13. The Ninth Circuit’s factors for determining likelihood has only one answer. Photocopies of this answer sheet may be submitted; however, this 4. As a practical matter, it is impossible to prove of confusion do not include: form should not be enlarged or reduced. whether the look and feel of one Web site appeared on A. Similarity of the two marks or trade dress. the Internet before the look and feel of another site. B. The defendant’s intent in selecting the mark. 3. Mail the answer sheet and the $15 testing fee ($20 for non-LACBA members) to: True. C. Evidence of actual confusion. False. D. Trademark registration. Los Angeles Lawyer 5. What is the Ninth Circuit’s standard for how similar 14. Likelihood of confusion exists when a reasonable MCLE Test P.O. Box 55020 the look and feel of a knockoff Web site must be to the consumer believes that the defendant’s product is Los Angeles, CA 90055 original in order for the copying to constitute copyright licensed, sponsored, endorsed, or authorized by the Make checks payable to Los Angeles Lawyer. infringement? plaintiff. A. Substantially similar. True. 4. Within six weeks, Los Angeles Lawyer will return your test with the correct answers, a B. Confusingly similar. False. rationale for the correct answers, and a C. Virtually identical. 15. Evidence of actual confusion is the best evidence certificate verifying the MCLE credit you earned D. None of the above. of likelihood of confusion. through this self-assessment activity. 6. Unlike copyright, trade dress need not be regis- True. 5. For future reference, please retain the MCLE tered, nor must it be original or creative. False. test materials returned to you. True. 16. Functionality, secondary meaning, and likelihood False. of confusion are highly fact-specific issues. ANSWERS 7. To sustain a claim for trade dress infringement, a Web True. Mark your answers to the test by checking the site owner must prove that: False. appropriate boxes below. Each question has only one answer. A. Its design is nonfunctional. 17. In trade dress actions, the court has discretion to B. Its design has acquired secondary meaning. award plaintiffs up to four times the amount of their C. The knockoff Web site creates a likelihood of monetary damages. 1. ■ True ■ False confusion in the mind of the consuming public True. 2. ■ True ■ False regarding the source, sponsor, or maker of the False. 3. ■ True ■ False infringing site. 18. In “exceptional” trade dress cases—generally 4. ■ True ■ False D. All of the above. those that involve intentional or deliberate infringe- ■ ■ ■ ■ 8. Which of the following is not an example of pro- ment—the court may award attorney’s fees. 5. A B C D tectable trade dress? True. 6. ■ True ■ False A. The hourglass shape of the classic Coca-Cola False. 7. ■ A ■ B ■ C ■ D bottle. 19. A district court in California required a copycat 8. ■ A ■ B ■ C ■ D B. Gateway’s cow-spotted computer boxes. site to 1) post hypertext links directing users to the ■ ■ C. The characters and design features used in infringed site and 2) forfeit its domain name. 9. True False the Pac-Man video game. True. 10. ■ A ■ B ■ C ■ D D. The words “Levi Jeans.” False. 11. ■ True ■ False In copyright actions, plaintiffs may recover: 9. A product feature is functional if it is useful or serves 20. 12. ■ True ■ False a purpose that is “the actual benefit the consumer A. Monetary damages. ■ ■ ■ ■ wishes to purchase” rather than a “mere arbitrary B. Statutory damages up to $150,000 in lieu of 13. A B C D embellishment.” monetary damages. 14. ■ True ■ False True. C. Attorney’s fees. 15. ■ True ■ False False. D. All of the above. 16. ■ True ■ False 10. In a Web site, what product feature can be char- 17. ■ True ■ False acterized as functional? A. Hypertext links. 18. ■ True ■ False B. Color scheme and particular arrangement of 19. ■ True ■ False text, images, and subject matter. 20. ■ A ■ B ■ C ■ D

Los Angeles Lawyer June 2010 43 June2010_IssueMaster.qxp 5/13/10 12:31 PM Page 44

the user interface and its source but con- so that the two products at issue will ulti- mined that the relevant consumer for the cluded that it still had not established sec- mately compete directly. purposes of discerning likelihood of confusion ondary meaning. Indeed, the court expressed 8) The degree of care that purchasers are was the German consumer.63 The German skepticism that the primary significance in a likely to exercise.58 court concluded that the German consumer consumer’s mind of a feature as inherently If a reasonable consumer believes that the was not likely to confuse the knockoff functional as a user interface could ever be to defendant’s product is licensed, sponsored, (StudiVZ) with the original (Facebook) for the identify the source or manufacturer.52 endorsed, or authorized by the plaintiff or fundamental reason that during the relevant The recent SG Services decision concluded made by the plaintiff and sold by the defen- time frame—before Facebook had introduced that while the Web site at issue was popular, dant under the defendant’s brand name, then a German-language version—the original site there was no evidence that its look and feel a likelihood of confusion exists.59 Knockoff (Facebook) was relatively unknown in had acquired secondary meaning. Although Web sites often employ strategies to lure users Germany.64 This circumstance, unusual as it the Web site owner introduced evidence of the from the original site, such as typo-squat- may seem, would likely present itself when- commercial success and media coverage of its ting (registering the copycat site at a domain ever a knockoff Web site served a foreign site (“the most popular web page on name that is a close misspelling of the origi- market in its native language. MySpace”),53 it still could not prove sec- nal site), tagging the knockoff site with key The German court’s ruling underscores ondary meaning because it presented no evi- words associated with the original to divert the uncertainty in finding trade dress pro- dence that the site’s commercial success had search engine traffic, or placing misleading tection for Web site look and feel when 1) led the public to associate the look and feel click-through advertisements or hyperlinks in practitioners seek to apply existing legal prin- of the site with its owner.54 popular third-party sites. While users may ciples in a new context, and 2) the Internet’s Many of the most popular sites on the realize they are on a different Web site with global nature means that ultimate questions Internet claim millions of daily visitors. It a different domain name, the similarity in of liability may be governed by the law of a seems plausible that users of sites like look and feel may lead them to believe the foreign jurisdiction.65 espn.com or cnn.com could identify these infringing site is somehow licensed or spon- sites by their look and feel even if all trade sored by the original site. However, no Worthwhile Pursuit names, trademarks, and logos were removed. recorded decision to date has addressed these Even if a Web site owner is somehow able to However, until a Web site owner actually issues. prevail on a copyright or trade dress claim, convinces a court that the primary significance Evidence of actual confusion is the best the victory may ultimately be deeply unsat- of its look and feel in the user’s mind is brand evidence of likelihood of confusion. Perhaps isfying. A victory would not result in shutting identification, these claims will face uncertain Web site visitors are posting comments down the Web site. At best, the defendant futures. demonstrating confusion as to whether a would be enjoined from operating a virtually Facebook is the second most-viewed Web knockoff site is affiliated with the original. identical or confusingly similar site. Thus the site in the world, with 175 million visitors While that evidence may be effective, it is knockoff could simply tweak its look and every day.55 Shortly after Facebook filed suit also problematic because of the difficulty in feel and be back in business within a day. against StudiVZ, one commentator quipped, proving its reliability. Web site visitors typi- Moreover, the tweaking itself is far too “While Facebook’s interface is hardly the cally post comments under a fictional screen cheaply accomplished to strike much fear in epitome of creativity, it is in its boringness, a name and may be impossible to locate for pur- a copycat’s heart. Losing a trade dress claim distinctive look associated with Facebook.”56 poses of acquiring a sworn affidavit or oth- involving a tangible product like a child’s The German court hearing the case acknowl- erwise demonstrating that they are not toy could cost the copycat millions in pack- edged that Facebook’s interface was “essen- employed by, or loyal to, the plaintiff.60 aging redesign, withdrawing and destroying tially distinctive” but dismissed Facebook’s In the German Facebook proceeding, the infringing packages, revising promotional claims without making a finding whether the court addressed the likelihood of confusion materials, and retooling factories. By con- interface had acquired secondary meaning. but only to dismiss the issue in cursory fash- trast, losing a Web site trade dress case may ion. The German court recognized that mean little more than asking a junior IT con- Likelihood of Confusion StudiVZ had duplicated elements of sultant to spend a few hours changing the The final trade dress infringement requirement Facebook’s distinctive interface but concluded site’s design and color scheme. involves proof that consumers visiting the that no trade dress infringement had taken If the knockoff Web site is foreign, it only knockoff Web site would likely be confused place because StudiVZ was not using makes the trade dress fight more expensive that the site was owned or sponsored by the Facebook’s look and feel as a trademark. and uncertain. As was the case in the plaintiff.57 The Ninth Circuit has developed Specifically, the court reasoned that StudiVZ Facebook litigation, forum non conveniens eight factors for determining likelihood of was not using Facebook’s look and feel to mis- concerns will likely mean that substantive confusion: lead consumers regarding the origin or owner issues are litigated in the foreign jurisdic- 1) Similarity of the two marks or trade dress. of the site because each Web page contained tion, because the majority of relevant wit- 2) Relatedness of the products or services of a visible StudiVZ logo.61 What the German nesses, documents, computers, and con- the plaintiff and defendant. court ignored was the possibility that users sumers most likely will be located on the 3) The advertising or marketing channels would conclude—visible logo or not—that knockoff’s home turf. In addition, the foreign used by the plaintiff and defendant. StudiVZ was affiliated with Facebook as a tribunal may view the copycat in a sympa- 4) The strength or distinctiveness of the plain- German subsidiary or licensee. thetic light as a local employer and taxpayer tiff’s trade dress. The Facebook case presented an unusual serving a multitude of local consumers. 5) The defendant’s intent in selecting the wrinkle in the analysis of likelihood of con- Indeed, Facebook found itself in the position mark—for example, whether evidence exists fusion. The StudiVZ Web site launched in of asking a German court to shut down a of the defendant’s intent to infringe and cre- Germany before Facebook introduced its social media site owned by a German com- ate confusion. German language version.62 Because the pany, based in Germany, and with 13 million 6) Evidence of actual confusion. knockoff was in German and targeted subscribers, nearly all of whom were German 7) Likelihood of expansion in product lines German consumers, the German court deter- citizens who had invested time and effort in

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establishing profiles and social networks on resolve the matter by acquiring the copycat 499 U.S. 340, 345 (1991). 8 See http://news.netcraft.com (last visited Mar. 2010). 66 the German site. entity. In these cases, the expense of the liti- 9 17 U.S.C. §411(a). Nevertheless, despite the challenges and gation, the uncertainty it creates for the future 10 U.S. COPYRIGHT OFFICE, CIRCULAR 66, COPYRIGHT frustrations, pursuing claims regarding Web of the copycat’s business, and the negative REGISTRATION FOR ONLINE WORKS, at 3 (rev’d May site look and feel may still be worthwhile publicity can combine to reduce the acquisi- 2009), as quoted in Darden v. Peters, 402 F. Supp. 2d for several reasons. While these claims may tion price substantially. 638, 643-44 (E.D. N.C. 2005). 11 CIRCULAR 66, at 3. be extremely difficult to win on the merits, By the time Facebook launched its 12 Darden, 402 F. Supp. 2d 638. they are nearly as difficult to dispose of before German-language version, StudiVZ already 13 Id. at 639-40. trial, because each of the trade dress infringe- had several million German members. 14 Id. ment elements is intensely factual.67 Generally, Facebook entered the German market as an 15 Id. at 644. 16 it is far more economical for a copycat to unknown, looking like it was a knockoff of Id. 17 Mortgage Market Guide, LLC v. Freedman Report, modify the look and feel of its Web site than the market-leading StudiVZ. Prior to bring- LLC, 2008 WL 2991570, at *12 (D. N.J. July 28, litigate fact-intensive claims through discov- ing suit, Facebook had reportedly negoti- 2008). ery and trial. ated for months to buy StudiVZ, but the 18 Id. Furthermore, the wide variety of available asking price was too high.78 The lawsuit 19 Id. at *26. remedies give potency to claims for the pro- generated much publicity and alerted German 20 17 U.S.C. §410(c). 21 Masquerade Novelty, Inc. v. Unique Indus., Inc., 912 tection of a Web site’s look and feel even consumers to the fact that Facebook had F. 2d 663, 668 (3d Cir. 1990). though they are so hard to prove. A victori- been the original site and that StudiVZ was 22 Courts typically will not admit documents obtained ous plaintiff could recover the copycat’s prof- a mere knockoff. Reports on the litigation from Web archive services unless a custodian of the its,68 damages to the plaintiff’s goodwill,69 and naturally compared the two sites and in so archives authenticates the documents. See St. Luke’s the “reasonable royalty” the plaintiff would doing often pointed out that StudiVZ had Cataract & Laser Inst. v. Sanderson, 2006 U.S. Dist. have earned had it licensed its intellectual experienced security and privacy problems.79 LEXIS 28873, at *5-6 (M.D. Fla. May 12, 2006). 23 Apple Computer, Inc. v. Microsoft Corp., 35 F. 3d 70 property to the copycat. In trade dress Thus, due to the litigation, at least some 1435, 1442 (9th Cir. 1994). actions, the court also has discretion to award portion of the German market came to view 24 See id. at 1446; Computer Access Tech. Corp. v. plaintiffs up to three times the amount of the choice of social networking media as Catalyst Enters., Inc., 2001 WL 34118030, at *12 their monetary damages71—and in excep- between the world market leader (Facebook) (N.D. Cal. June 13, 2001). 25 tional cases, generally involving intentional or and a knockoff with security and privacy Crown Awards, Inc. v. Trophy Depot, 2003 WL 22208409, at *12 (E.D. N.Y. Sept. 3, 2003). deliberate infringement, the court can award problems that might soon be shut down alto- 26 Id. 72 attorney’s fees. In copyright matters, if reg- gether by a judge (StudiVZ). This was fairly 27 Id. at *13. istration was secured prior to the infringe- powerful marketing. 28 Complaint, Facebook, Inc. v. StudiVZ Ltd., Case No. ment, the plaintiff may recover its attorney’s Indeed, just two weeks before Facebook 5:08-CV-03468 JF, Docket No. 1, at ¶¶ 75-119 (N.D. fees,73 and if the infringement was “willful,” settled and withdrew its U.S. lawsuit, the Cal., filed July 18, 2008). 29 Blue Bell Bio-Med. v. Cin-Bad, Inc., 864 F. 2d 1253, the plaintiff can opt to recover statutory dam- press reported that in the relatively brief 1256 (5th Cir. 1989). ages of up to $150,000 instead of its mone- period the action was pending, Facebook 30 Brunswick Corp. v. Spinit Reel Co., 832 F. 2d 513, tary damages.74 had managed to overtake StudiVZ as 517 (10th Cir. 1987). In addition to these remedies, courts have Germany’s largest social networking site.80 31 U.S. Trademark Registration No. 1,057,884. discretion to award fairly creative penalties. Facebook may have lost the legal battle, but 32 Gateway, Inc. v. Companion Prods., Inc., 384 F. 3d 503, 506 (8th Cir. 2004). For example, the trial court in the Taco in fighting that battle, it appears to have won 33 ■ Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, Cabana case penalized the defendant restau- the war for the marketplace. 765 (1992). rant chain for its knowing and willful infringe- 34 Reader’s Digest Ass’n v Conservative Digest, Inc., 821 ment by requiring it to post in each of its loca- 1 Complaint, Facebook, Inc. v. StudiVZ Ltd., Case F. 2d 800, 802 (D.C. Cir. 1987). tions a white sign with 1-inch black letters No. 5:08-CV-03468 JF, Docket No. 1 (N.D. Cal., 35 Midway Mfg. Co. v. Dirkschneider, 543 F. Supp. reading: “Notice: Taco Cabana originated a filed July 18, 2008). 466, 485 (D. Neb. 1981). 2 Pete Cashmore, StudiVZ—Massive Controversy 36 Two Pesos, 505 U.S. at 767. restaurant concept which Two Pesos was Surrounds Facebook Rip-Off, Nov. 15, 2006, 37 See Blue Nile, Inc. v. Ice.com, Inc., 478 F. Supp. 2d found to have unfairly copied. A court order http://mashable.com/2006/11/15/studivz-controversy 1240, 1246 (W.D. Wash. 2007) (Diamond retailer requires us to display this sign to inform our -surrounds-facebook-rip-off/; Richard Korman, sought trade dress protection for look and feel of customers of this fact to eliminate the likeli- Facebook Sues German “Clone,” July 21, 2008, Web site.); G. PETER ALBERT, JR., INTELLECTUAL hood of confusion between our restaurant and http://government.zdnet.com/?p=3898; Michael PROPERTY LAW IN CYBERSPACE 198-99 (1999 & supp. StudiVZ Won’t Comment on Facebook 2005) (“One of the next conflicts to arise between the those of Taco Cabana.”75 Courts have Arrington, Lawsuit, But Will Talk Smack in General, July 20, Internet and trademark law is likely to be the ques- imposed similar penalties in the context of 2008, http://www.techcrunch.com/2008/07/20 tion of whether a Web page contains elements pro- Web site infringement, including requiring /studivz-wont-comment-on-facebook-lawsuit-but-will tectable as trade dress.…Trade dress protection of the copycat site to post hypertext links direct- -talk-smack-in-general. Web pages has yet to be the central issue in an ing users to the infringed site.76 Still another 3 Alex Bakst, StudiVZ Takes on Facebook, Nov. 7, infringement claim.”); Complaint, Facebook, Inc. v. StudiVZ Ltd., Case No. 5:08-CV-03468 JF, Docket option is forcing the copycat to forfeit its 2006, http://www.spiegel.de/international/0,1518 ,446353,00.html. No. 1 (N.D. Cal., filed July 18, 2008). 77 domain name. 4 Complaint, Facebook, Case No. 5:08-CV-03468 JF, 38 Two Pesos, 505 U.S. at 770. Finally, plaintiffs will realize significant at ¶1. 39 Vuitton et Fils S.A. v. J. Young Enters., 644 F. 2d 769, publicity benefits from bringing a suit to pro- 5 See www.alexa.com/topsites (last visited Mar. 27, 774 (9th Cir. 1981). tect look and feel. Suing a copycat Web site 2010). 40 See Clicks Billiards, Inc. v. Sixshooters, Inc., 251 F. 6 generates positive attention for the plaintiff’s See Robin Wauters, Facebook and StudiVZ Dispute 3d 1252, 1261 (9th Cir. 2001) (A billiard hall may have Ends with Settlement, Sept. 10, 2009, http://www a total visual appearance that constitutes protectable site—“we’re so good they’re copying us!”— .washingtonpost.com/wp-dyn/content/article/2009 trade dress.). and necessarily draws negative attention to the /09/10/AR2009091000764.html. 41 Id. at 1259. knockoff. Indeed, “knockoff” is a pejorative 7 See 17 U.S.C. §§101 (definition of “compilation”) and 42 Id. at 1261. term that suggests inferior quality. Moreover, 102(a) (copyright protects “original works of author- 43 SG Servs., Inc. v. God’s Girls Inc., 2007 WL 2315437, the infringed site may find it beneficial to ship”); Feist Publ’ns, Inc. v. Rural Tel. Serv. Co., Inc., at *9 (C.D. Cal. May 9, 2007) (unpublished).

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44 Id. (quoting Rachel v. Banana Republic, Inc., 831 F. years). Compare Levi Strauss, 778 F. 2d at 1361 (16 59 First Brands Corp. v. Fred Meyer, Inc., 809 F. 2d 2d 1503, 1506 (9th Cir. 1987)). years not long enough). 1378, 1384 (9th Cir. 1987). 45 Clicks Billiards, 251 F. 3d at 1262. 51 Computer Access Tech. Corp. v. Catalyst Enters., 60 SG Servs., Inc. v. God’s Girls Inc., 2007 WL 2315437, 46 Wal-Mart Stores, Inc. v. Samara Bros., Inc., 529 U.S. Inc., 2001 WL 34118030, at *12 (N.D. Cal. June 13, at *5 (C.D. Cal. May 9, 2007) (unpublished) (Postings 205, 210 (2000). 2001). made by unidentified users were inadmissible to prove 47 Ideal Toy Corp. v. Chinese Arts & Crafts, Inc., 530 52 Id. actual confusion because “[t]here is absolutely no indi- F. Supp. 375, 378 (S.D. N.Y. 1981). 53 SG Servs., Inc. v. God’s Girls Inc., 2007 WL 2315437, cia that the statements…are reliable.”). 48 Levi Strauss & Co. v. Blue Bell, Inc., 632 F. 2d 817, at *9 (C.D. Cal. May 9, 2007) (unpublished). 61 Facebook, Inc. v. StudiVZ Ltd., 33 O 374/08 818 (9th Cir. 1980). 54 Id. at *10. (Cologne State Court, June 16, 2009). English trans- 49 See First Brands Corp. v. Fred Meyer, Inc., 809 F. 55 See www.alexa.com/topsites (last visited Mar. 27, lation at 13 of June 16, 2009, Judgment issued by the 2d 1378, 1383 (9th Cir. 1987). 2010); Michael Arrington, Facebook COO: 175 Million Cologne State Court filed as Exhibit “A” to Elsing 50 Polaris Pool Sys. v. Letro Prods., 886 F. Supp. People Log into Facebook Every Day, Feb. 1, 2010, Declaration in support of Facebook’s Opposition to 1513, 1516 (C.D. Cal. 1995) (trade dress in use for http://techcrunch.com/2010/02/01/facebook-coo-sheryl Defendant’s Administrative Motion Requesting a Stay over 20 years); Vaughan Mfg. Co. v. Brikam Int’l, -sandberg-world-economic-forum-davos/. of Proceedings and a Status Conference (the Cologne Inc., 814 F. 2d 346, 349 (7th Cir. 1987) (over 40 56 Korman, supra note 2. Judgment), Facebook, Inc. v. StudiVZ Ltd., Case No.: years); Contour Chair Lounge Co. v. True-Fit Chair, 57 Clicks Billiards, Inc. v. Sixshooters, Inc., 251 F. 3d 5:08-CV-03468 JF, Docket No. 185-1 (N.D. Cal. filed Inc., 648 F. Supp. 704, 710 (E.D. Mo. 1986) (39 1252, 1265 (9th Cir. 2001). June 22, 2009). years); Rolls-Royce Motors, Ltd. v. A & A Fiberglass, 58 AMF, Inc. v. Sleekcraft Boats, 599 F. 2d 341, 349 62 The Cologne Judgment, at 9-10. Inc., 428 F. Supp. 689, 698 (N.D. Ga. 1977) (66 (9th Cir. 1979). 63 Id. 64 Id. Facebook presented evidence that the English version of Facebook had been available to German consumers since before StudiVZ was introduced, but the German court concluded that Facebook’s presence was still relatively insignificant. 65 Not every jurisdiction protects intellectual property as extensively as the United States. For example, the German Facebook opinion suggested potential differences between German and U.S. law. While a U.S. court would ask whether the infringed design features created a likelihood of confusion among consumers as to the source of the infringing Web site, the German court used the German “doctrine of freedom of imitation” as the point of departure and asked whether the imitation in question caused “avoidable deception” of the consumer regarding the commercial origin of the imitated product. See the Cologne Judgment, at 8-10. It is not clear that the German approach would result in an outcome consistent with American law. 66 Notice of Motion and Motion to Dismiss for Lack of Personal Jurisdiction or, in the Alternative, for Forum Non Conveniens on Behalf of StudiVZ Ltd., Facebook, Case No. 5:08-CV-03468 JF. 67 See Tie Tech, Inc. v. Kinedyne Corp., 296 F. 3d VALUECONOMICS, INC. 778, 783 (9th Cir. 2002) (“[F]unctionality is generally viewed as an intensely factual issue.”); Vision Sports, Jules H. Kamin, B.A.Sc., M.A., M.B.A., Ph.D. Inc. v. Melville Corp., 888 F. 2d 609, 614 (9th Cir. 1989) (Whether trade dress has acquired secondary meaning is a question of fact.); Thane Int’l, Inc. v. Effective Damages Testimony Since 1987 Trek Bicycle Corp., 305 F. 3d 894, 901-02 (9th Cir. 2002) (Likelihood of confusion between two trademarks is a factual determination.). 68 PHONE 323.653.9555 • E-MAIL [email protected] 15 U.S.C. §1117(a); 17 U.S.C. §504(b). www.valu-econ.com 69 Id. 70 Id. 71 15 U.S.C. §1117(a). 6380 WILSHIRE BLVD., SUITE 1102, LOS ANGELES, CA 90048 72 Id.; Armstrong Cork Co. v. Armstrong Plastic Covers Co., 434 F. Supp. 860, 873 (E.D. Mo. 1977). 73 17 U.S.C. §§412, 505. 74 17 U.S.C. §§412, 504(c). 75 Tracey Taylor Woodard, Judge Details Changes in Be an attorney who makes a difference Two Pesos Concept, Jan. 23, 1989, http://findarticles Winner of the volunteer with the LACBA .com/p/articles/mi_m3190/is_n4_v23/ai_6996322/. COMMUNITY SERVICE 76 See Garden of Life, Inc. v. Letzer, 318 F. Supp. 2d Domestic Violence Project AWARD 946, 968 (C.D. Cal. 2004). Criminal Justice Panel of the 77 Id. Los Angeles City Attorney's Office — SAVE THE DATE: Training Seminar • September 29, 2010 — 78 Kevin O’Brien, Facebook and StudiVZ Battle over Germany, N.Y. TIMES, Aug. 7, 2008, http://www We provide one-on-one legal assistance to our clients to enable them to obtain No prior experience is .nytimes.com/2008/08/07/technology/07iht-social.4 temporary (and ultimately permanent) Restraining Orders against their assailants. required. No ongoing representation is required .15091587.html. This is a rewarding opportunity (with a minimal time commitment) to give although volunteers have the 79 Id.; Helen Chernikoff, German Site Sued by Facebook valuable assistance to an underrepresented population of our community who is option of representing their Says Claims Without Merit, July 20, 2008, http: in dire need of help.The Project is located in both the Downtown Los Angeles and clients at the time of their //www.reuters.com/article/idUSN2034220420080720. Pasadena Branches of the Superior Court. hearing. 80 Markus Goebel, Facebook Accelerates Past StudiVZ in Germany, Aug. 25, 2009, http://eu.techcrunch.com For information about the project and upcoming trainings, call Deborah Kelly, Directing Attorney /2009/08/25/facebook-accelerates-past-studivz-in TEL 213.896..6491 • E-MAIL [email protected] -germany/.

46 Los Angeles Lawyer June 2010 June2010_IssueMaster.qxp 5/13/10 12:32 PM Page 47

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Contact Link K. reputation in construction law emphasizing our Schwartz. Full-service divorce, custody, child practice in the area of mechanic’s leins, stop support, child support arrears and enforcement. notice and bond claims; payment and perfor- Prenups, postnups, domestic partners, grandpar- mance bond claims; Contractors’ State License ent rights, complex and simple property division. Board and licensing issues. Disciplinary disputes, defending accusation, citations and complaints; CIVIL RIGHTS LAW contract review, drafting and negotiation, mediation, arbitration, litigation and administrative hear- GLADSTONE MICHEL WEISBERG ings, and much more. WILLNER & SLOANE, ALC 4551 Glencoe Avenue, Suite 300, Marina del Rey, HUNT ORTMANN PALFFY NIEVES LUBKA CA 90292, (310) 821-9000, fax (310) 775-8775, DARLING & MAH, INC. —ATTORNEYS AND e-mail: [email protected]. Web site: COUNSELORS AT LAW www.GladstoneMichel.com. Contact Arthur 301 North Lake Avenue, 7th Floor, Pasadena, CA Willner. Gladstone Michel has a strong track 91101, (626) 440-5200, fax (626) 796-0107, record of success representing individuals and e-mail: [email protected]. Web entities in consumer protection and civil rights site: www.HuntOrtmann.com. Contact Brian cases involving employment discrimination, sexual Robbins, executive director. The cornerstone of harassment, First Amendment rights, racial profil- construction law. Hunt Ortmann is one of the fore- ing, individual rights in higher education, fair hous- most authorities on California construction law, ing, public accommodations, police accountability, contracts, dispute resolution and litigation offering and due process and other constitutional rights additional legal services in the areas of business and protections. and commercial law, employment matters and

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labor law compliance, real estate, insurance, and suretyship.

CRIMINAL DEFENSE LAW HUTTON & WILSON 1055 East Colorado Boulevard, Suite 310, LAW FIRM ISSUES Pasadena, CA 91106, (626) 397-9700, fax (626) 397-9707, e-mail: [email protected]. Web site: www.hutton-wilson.com. Contact Robert J. organization — disputes — advice Wilson. Hutton & Wilson specialize in driving under the inﬂuence, vehicular manslaughter, DUI murder and shaken baby defense. Additionally, we repre- ROLSTON.NET sent drivers before the Department of Motor Vehi- cles regarding driving under the inﬂuence, medical and negligent operator suspensions or revocations.

KAPLAN MARINO, P.C. 9454 Wilshire Boulevard, Suite 500, Beverly Hills, CA 90212, (310) 557-0007, fax (310)275-4651, e-mail: [email protected]. Web site: www.kaplanmarino.com. Contact Nina Marino. Kaplan Marino is a criminal defense law ﬁrm dedicated to the representation of persons and entities accused or suspected of criminal conduct in the state and federal courts. Our clients, businesspeo- ple, professionals, and others—are always guaranteed the highest degree of professionalism and personal attention. The ﬁrm regularly handles white collar cases including all areas of fraud, as well as traditional defense matters such as DUI/DMV hearings, domestic violence, drug cases, and sex crimes.

LAW OFFICES OF LAWRENCE WOLF 10390 Santa Monica Boulevard, Suite 300, Los Angeles, CA 90025, (310) 277-1707, fax (310) 277-1500, e-mail: [email protected]. Web site: www.youareinnocent.com. Contact Lawrence Wolf. By dedicating all resources and energy to getting the best result for our clients, CHARLES PEREYRA-SUAREZ combined with our firm’s 30 years of experience, — ARBITRATOR AND MEDIATOR — we are prepared to handle the most serious offenses with confidence. We defend those that RELEVANT EXPERIENCE: have been accused, or are under investigation for involvement in today’s complex crimes. Our expe- • Trial/Appellate Attorney, U.S. Justice Department Civil Rights Division rience includes cases such as embezzlement, child molestation, fraud, rape, theft, murder, • Federal Prosecutor in Los Angeles drugs, domestic violence, sex crimes, weapons, • Litigation Partner in Two National Law Firms drunk driving, and many others. • Judge Pro Tem, Los Angeles County Superior Court CRIMINAL DEFENSE/WHITE COLLAR • Diverse ADR and Expert Witness Practice NASATIR, HIRSCH, PODBERESKY, KHERO 445 S. FIGUEROA STREET, SUITE 3200, LOS ANGELES CA 90071 & GENEGO Tel 213.623.5923 Fax 213.623.1890 http://www.cpsarbitration.com 2115 Main Street, Santa Monica, CA 90405, (310) 399-3259, fax (310) 392-9029, e-mail: [email protected]. Contact Richard Hirsch. Delivering high quality and professional representation to both individual and corporate clients, INSURANCE BAD FAITH EXPERT our firm specializes in federal and state white collar and non-white collar criminal defense. Members of our firm have served as former state and federal Clinton E. Miller, J.D., BCFE prosecutors, and on faculty at the USC Gould Author: How Insurance Companies Settle Cases School of Law. Members of the firm have received numerous awards for excellence in practice, as well 39 YEARS EXPERIENCE as being named in Best Lawyers of America and Qualified Trial Insurance Expert in Civil & Criminal Cases Nationwide Super Lawyers of Southern California. Coverage Disputes – Customs and Practices in the Insurance Industry – Good Faith/Bad Faith Issues DISPUTE RESOLUTION TEL 408.279.1034 | EMAIL [email protected] | FAX 408.279.3562 HONORABLE LAWRENCE W. CRISPO www.millerjd.qpg.com 501 Glen Court, Pasadena, CA 91105, (213) 926- 6665, fax (626) 744-0363, e-mail: judgecrispo

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Engineering Resolutions for the World’s Most Intractable Disputes @earthlink.net. Web site: www.judgecrispo.com. tion cases, social security disability and personal Contact Lawrence W. Crispo. Mediator-discov- injury. To referring attorneys we pay 20 percent of ery referee/special master arbitrator, early neutral the fees regarding regular issues. Referrals are Reginald A. Holmes, ESQ. evaluation. See display ad on page 24. handled in strict accordance with the State Bar Mediator • Arbitrator • Private Judge Rules. KANTOR & KANTOR LLP Business • Intellectual Property • Franchise Employment • International 19839 Nordhoff Street, Northridge, CA 91324, EMPLOYMENT LAW (818) 886-2525, fax (818) 350-6272, e-mail: GLADSTONE MICHEL WEISBERG WILL- • Superb judicial temperament [email protected]. Web site: www.kantorlaw NER & SLOANE, ALC • Fiercely fair and impartial .net. Contact Glenn Kantor or Alan Kassan. • Orderly party driven process Administrative appeals, litigation, state and federal 4551 Glencoe Avenue, Suite 300, Marina del Rey, • Deep subject matter knowledge court, appellate work, free consultations, and all CA 90292, (310) 821-9000, fax (310) 775-8775, cases are taken on a contingency fee basis. See e-mail: [email protected]. Web site: display ad on this page. www.GladstoneMichel.com. Contact Teresa Tracy. Gladstone Michel represents employers in DUI all aspects of labor and employment law, including wrongful termination, discrimination, harassment, LAW OFFICES OF LAWRENCE WOLF wage and hour, class actions, union organizing, 10390 Santa Monica Boulevard, Suite 300, Los negotiations, and charges of unfair labor practices. Angeles, CA 90025, (310) 277-1707, fax (310) We also advise clients on compliance with the 277-1500, e-mail: [email protected]. Web myriad of state and federal regulations governing site: www.youareinnocent.com. Contact employers such as leave statutes, wage and hour Lawrence Wolf. With over 30 years of experi- requirements, the issuance of employment policies ence, Lawrence Wolf is a recognized expert in and handbooks, the handling of discipline, termina- drunk driving, DUI, drug possession, and addic- tion, the investigation of harassment, and other AAA National Roster of Neutrals • College of Commercial Arbitrators • Association tion-related matters. Our firm has rightfully earned matters. When disputes cannot be avoided, we for International Arbitration • Academy of the respect of judges, prosecutors, and police offi- aggressively represent clients in state and federal Distinguished Neutrals cers as aggressive attorneys who are not afraid to courts and in appellate proceedings. challenge them on tough cases. We have estab- The Holmes Law Firm lished long-term relationships with judges and dis- LAW OFFICE OF ELI M. KANTOR trict attorneys throughout Los Angeles, Orange, 9595 Wilshire Boulevard, Suite 405, Beverly Hills, t f 1.877. FAIR.ADR ( ) • 1.626.432.7223 ( ) Sacramento, and Ventura Counties. CA 90212, (310) 274-8216, fax (310) 273-6016, [email protected] e-mail: [email protected]. Web site: www.beverly- www.theholmeslawfirm.com ELDER FINANCIAL ABUSE hillsemploymentlaw.com. Contact Eli Kantor. We specialize in all aspects of labor and employ- KANTOR & KANTOR LLP ment law, including sexual harassment, wrongful 19839 Nordhoff Street, Northridge, CA 91324, discharge, employment discrimination, wage and (818) 886-2525, fax (818) 350-6272, e-mail: hour, as well as class action litigation. [email protected]. Web site: www.kantorlaw .net. Contact Glenn Kantor or Alan Kassan. ENTERTAINMENT LAW Administrative appeals, litigation, state and federal ERISA court, appellate work, free consultations, and all GLADSTONE MICHEL WEISBERG LAWYERS cases are taken on a contingency fee basis. See WILLNER & SLOANE, ALC display ad on this page. 4551 Glencoe Avenue, Suite 300, Marina del Rey, LONG TERM DISABILITY, LONG CA 90292, (310) 821-9000, fax (310) 775-8775, EMINENT DOMAIN TERM CARE, HEALTH, e-mail: [email protected] and [email protected]. Web site:www EATING DISORDER, AND LIFE CALIFORNIA EMINENT DOMAIN LAW .GladstoneMichel.com. Contacts Leon Glad- INSURANCE CLAIMS GROUP, APC stone and Owen Sloane. Gladstone Michel has 3429 Ocean View Boulevard, Suite L, Glendale, a full-service Entertainment and Media Group ERISA & BAD FAITH CA 91208, (818) 957-0477, fax (818) 957-3477, focusing on music, film, television, radio, publish- MATTERS e-mail: [email protected]. Web site: www ing and theater, as well as entertainment insur- .caledlaw.com. Contact A. J. Hazarabedian. ance matters. Our clients include musicians, The attorneys at California Eminent Domain Law record labels, actors, directors, producers, ✔ California state and federal courts Group—a Martindale-Hubbell AV® Rated law screenwriters, publishers, production companies, ✔ More than 20 years experience firm – are California’s premier eminent domain multimedia companies, promoters, distributors, ✔ Settlements, trials and appeals attorneys, with extensive experience in all facets authors and other entertainment clients, as well as of eminent domain. Our attorneys practice exclu- entertainment insurers, completion guarantors, Referral fees as allowed by sively eminent domain law and have successfully and a host of below-the-line talent. We have State Bar of California handled hundreds of eminent domain cases. We extensive experience drafting and negotiating are committed to obtaining maximum compensa- recording, publishing, finance, development, pro- tion for our property and business owner clients, duction, distribution, touring, merchandising, cor- Kantor & Kantor LLP and are happy to work with other law firms to porate sponsorship, and other agreements. We assist their clients in their eminent domain needs. 818.886.2525 TOLL FREE also advise clients on copyright, intellectual prop- See display ad on page 30-31. erty, and digital media, and offer expert witness 877.783.8686 and litigation consultant services. www.kantorlaw.net EMPLOYEES WORKERS’ COMPENSATION BENEFITS LAW OFFICES OF LINK K. SCHWARTZ GOODCHILD AND DUFFY PLC 1925 Century Park East, Suite 2300, Los Angeles, CA 90067, (310) 553-LINK, fax (310) 553-5430, 16133 Ventura Boulevard, Suite 1250, Encino, CA e-mail: [email protected]. Contact Link K. 91346, (818) 380-1600, fax (818) 380-1616. Web Schwartz. Full-service divorce, custody, child site: www.jackgoodchildlaw.com. Contact support, child support arrears and enforcement. Martha Castillo. We handle workers’ compensa-

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Prenups, postnups, domestic partners, grandpar- LAW OFFICES OF VINCENT W. DAVIS & estates, as well as custody matters, paternity ent rights, complex and simple property division. ASSOCIATES cases, and the negotiation of premarital agree- 150 North Santa Anita Avenue, Suite 200, Arcadia, ments. Our clients include high-profile members of ESTATE PLANNING, TRUST AND PROBATE CA 91006, (626) 446-6442, fax (626) 446-6454, the entertainment, professional athlete, and business communities. Ms. Forman has been selected SIRKIN AND SIRKIN e-mail: [email protected]. Web site: www.vincentwdavis.com. Contact Vincent as top 100 Southern California Super Lawyers and 21550 Oxnard Street, 3rd Floor, Woodland Hills, Davis Esq. Litigators: family law, juvenile depen- Top 50 Women Lawyers in Southern California. CA 91367, (818) 340-4479, fax (818) 340-7952. dency, probate, civil, criminal, labor and immi- The firm is included in Martindale-Hubbell’s Bar Web site: www.sirkinlaw.com. Contact Nina N. gration. Register of Preeminent Lawyers and in Best Sirkin. Estate planning, probate, conservator- Lawyers in America. ships, elder law, and structured settlements. See LAW OFFICES OF JUDITH R. FORMAN, display ad on page 38. P.C. LAW OFFICES OF MICHAEL KELLY 429 Santa Monica Boulevard, Suite 120, Santa ERISA BENEFITS 11355 West Olympic Boulevard, Los Angeles, CA 90064, (310) 444-8840, fax (310) 444-8841, Monica, CA 90401, (310) 393-0236, fax (310) KANTOR & KANTOR LLP e-mail: [email protected]. Web site: 393-4221, e-mail: admin@cfli.com. Web site: www.CFLI.com. Contact Jack M. Bennett, 19839 Nordhoff Street, Northridge, CA 91324, www.familylawcounsel.com. Contact Judith R. Executive Administrator. Over 100 years com- (818) 886-2525, fax (818) 350-6272, e-mail: Forman. Our three attorney law firm focuses on bined family law experience. Practice limited to [email protected]. Web site: www.kantor- marital dissolutions involving complex multi-asset law.net. Contact Glenn Kantor or Alan Kassan. Administrative appeals, litigation, state and federal court, appellate work, free consultations, and all cases are taken on a contingency fee basis. See display ad on page 50. Where can you find eight EXPERT WITNESS OSTROVE, KRANTZ & ASSOCIATES tax attorneys under one roof who have 5757 Wilshire Boulevard, Suite 535, Los Angeles, been named among the CA 90036, (323) 939-3400, fax (323) 939-3500, e-mail: [email protected]. Web site: www “Top Attorneys In Southern California”? .lawyers.com/ok&alaw. Contact David Ostrove. Expert witness for over 47 years. Specializes in lawyer/accountant malpractice, forensic accounting, tax matters, business valuation, value of services, computation of damages, mediator, and arbitrator. Professor of Law Accounting. See dis- AVRAM SALKIN, Principal play ad on page 53. CHARLES P. RETTIG, Principal FAMILY LAW STEVEN R. TOSCHER, Principal BRANDON LAW GROUP DENNIS L. PEREZ, Principal 200 Oceangate, Suite 1500, Long Beach, CA 90802, (562) 901-9800, fax (562) 983-9383. EDWARD M. ROBBINS, JR., Principal Web site: www.brandonlaw.net. Contact Lisa Brandon. Divorce, legal separation, modifications, SHARYN M. FISK, Principal custody disputes, paternity, domestic partnership termination and related civil matters. MICHEL R. STEIN, Principal GOLSAN, ZIFF & ZIFF DAVID ROTH, Of Counsel 5840 Uplander Way, Suite 102, Culver City, CA 90230, (310) 342-2818, fax (310) 342-2825, e-mail: [email protected]. Web site: www HOCHMAN, SALKIN, RETTIG, TOSCHER & PEREZ, P.C. .gzzfamilylaw.com. Contact Ron Ziff, CFLS, Hali Ziff, or Maryanne Golsan, CFLS. A full-ser- 9150 Wilshire Boulevard, Suite 300 vice family law firm providing litigation and media- Beverly Hills, California 90212-3414 tion services in family law, conservatorship/ Telephone: 310.281.3200 guardianship, contested and uncontested. French spoken. Fax: 310.859.1430 www.taxlitigator.com KOLODNY & ANTEAU 9100 Wilshire Boulevard, Ninth Floor-West Tower, Beverly Hills, CA 90212, (310) 271-5533, fax (310) Credibility, dedication and innovation in resolving sensitive 271-3918. Web site: www.kolodny-anteau.com. tax issues for more than 50 years . . . Our firm specializes in sophisticated and complex family law and matrimonial matters arising out of interpersonal relationships both domestically and abroad. Our team of experienced and highly quali- Specializing in federal and state civil and criminal tax litigation, controversies fied family law attorneys offers additional services with federal, state, and local taxing authorities, white-collar crime criminal relating to paternity, palimony, marital and domes- defense, forfeitures, estate and business planning, probate, tax-exempt tic torts, child abuse and child abduction. organizations, and real estate, business and corporate transactions.

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family law. One of California’s oldest and largest LAW OFFICES OF MICHAEL GOCH, APC INSURANCE BAD FAITH EXPERT divorce and family law firms. Complex property liti- 5850 Canoga Avenue, Suite 400, Woodland CHEONG, DENOVE, ROWELL & BENNETT gation. Complex child custody. No charge consul- Hills, CA 91367, (818) 710-7190, fax (818) 710- tation. Eight attorneys and 20 staff. See display 7191, e-mail: [email protected]. Web site: 10100 Santa Monica Boulevard, Suite 2460, Los ad on page 39. MichaelGoch.com. Contact Michael Goch. Angeles, CA 90067, (310) 277-4857, fax (310) 277-5254, e-mail: fi[email protected]. Web site: LAW OFFICES OF LINK K. SCHWARTZ Licensing and related disciplinary proceedings with emphasis on healthcare practitioners, as well www.cdrb-law.com. Contact Lorraine Jackson 1925 Century Park East, Suite 2300, Los Angeles, as Department of Health Services matters and for Jack Denove. Attorneys at Cheong, Denove, CA 90067, (310) 553-LINK, fax (310) 553-5430, related issues, from investigatory stage through Rowell & Bennett have successfully represented e-mail: [email protected]. Contact Link trial and writ proceedings. Degrees/licenses: JD clients for 30 years in all types of insurance bad K. Schwartz. Full-service divorce, custody, child Southwestern University School of Law, Cum faith actions. Senior Partner Jack Denove has support, child support arrears and enforcement. Laude, 1978; Admitted in California since 1978. received numerous awards for his trial successes Prenups, postnups, domestic partners, grandpar- Also admitted in Central, Eastern, Northern, and commitment to representing the rights of the ent rights, complex and simple property division. Southern District and Ninth Circuit. injured, including Trial Lawyer of the Year and Los Angeles Best Lawyer. He is the President of Italian WALZER & MELCHER LLP IMMIGRATION AND NATIONALITY LAW American Lawyers Association; Past President of 21700 Oxnard Street, Suite 2080, Woodland Hills, Consumer Attorneys Association of Los Angeles; CA 91367, (818) 591-3700, fax (818) 591-3774, LAW OFFICE OF ELI M. KANTOR Diplomate of ABOTA; and on the Board of Direc- e-mail: [email protected]. Web site: www 9595 Wilshire Boulevard, Suite 405, Beverly Hills, tors of the Consumer Attorneys of California. See .walzermelcher.com. Contact Arlene Lebet- CA 90212, (310) 274-8216, fax (310) 273-6016, display ad on page 24. samer. Walzer & Melcher represents clients in e-mail: [email protected]. Web site: www KANTOR & KANTOR LLP divorce, custody and paternity matters. We nego- .beverlyhillsimmigrationlaw.com. Contact Eli Kan- tiate and prepare pre- and postmarital agree- tor. Specializes in all aspects of business, enter- 19839 Nordhoff Street, Northridge, CA 91324, ments. tainment, investor, and family immigration law. (818) 886-2525, fax (818) 350-6272, e-mail: [email protected]. Web site: www.kantorlaw FRANCHISE LAW HIRAM W. KWAN, A PROFESSIONAL LAW .net. Contact Glenn Kantor or Alan Kassan. CORPORATION BARRY KURTZ, A PROFESSIONAL Administrative appeals, litigation, state and federal 200 South San Pedro Street, Suite 502, Los CORPORATION court, appellate work, free consultations, and all Angeles, CA 90012, (213) 680-0122, fax (213) cases are taken on a contingency fee basis. See 16000 Ventura Boulevard, Suite 1000, Encino, 680-4210, e-mail: [email protected]. Contact display ad on page 50. CA 91436, (818) 728-9979, fax (818) 986-4474, Hiram W. Kwan. Defense of deportation case, e-mail: [email protected]. Web site: administrative and appellate review, filing of CLINTON E. MILLER, JD, BCFE www.barrykurtzpc.com. Contact Barry Kurtz. employment, family petitions for permanent resi- 502 Park Avenue, San Jose, CA 95110, (408) Regulatory compliance, ownership, structuring dence and temporary residence and visas. 279-1034, fax (408) 279-3562, e-mail: cem- and acquisitions and dispositions of franchisors [email protected]. Contact Clint Miller. Insurance and franchisees, with an emphasis on franchisors INCORPORATION SERVICES expert regarding claims, underwriting, agent and and franchisees in the restaurant business. brokers errors and omissions, coverage disputes, GLOBAL CORPORATE SERVICES, INC. RODNEY R. HATTER & ASSOCIATES customs and practices, and bad faith. See dis- 704 North King Street, Suite 500, Wilmington, DE play ad on page 49. 1301 Dove Street, Suite 900, Newport Beach, 19801, County of New Castle, toll free (800) 219- CA 92660, (949) 376-9977, fax (949) 494-3448, 9359, (561) 968-6611, fax (703) 995-0899, e-mail: JUVENILE DEPENDENCY e-mail: [email protected]. Web site: www [email protected]. Web site: www.global- .californiafranchiseattorney.com. Contact Rod- inter.net. Contact Phyllis Jacobs. Global Corpo- LAW OFFICES OF PAULA S. TESKE ney Hatter. Providing advice and assistance to rate Service offers a turn-key solution when start- 3415 South Sepulveda Boulevard, Suite 660, Los franchisors, franchisees and other businesses ing a new business. As industry leaders we are Angeles, CA 90034, (310) 391-6800, fax (310) regarding issues of franchising and alternative dis- experts in the area of incorporation. Our service is 391-1725, e-mail: [email protected]. tribution programs since 1985. Previously General well established, professional, and reliable. We Web Site: www.teskelaw.com. Contact Paula S. Counsel to California’s largest franchisor. have been filing corporations and have been regis- Teske. Paula S. Teske, Esq., has over 29 years of tered agent in Delaware for over 31 years. Why experience “in the trenches,” vigorously represent- HEALTH AND LIFE INSURANCE CLAIM not give us a call today to discuss your corporate ing parents and relatives in the Los Angeles Juve- KANTOR & KANTOR LLP filing needs. nile Dependency Courts. She specializes in complicated and serious abuse/neglect allegations, is 19839 Nordhoff Street, Northridge, CA 91324, INSURANCE LAW well versed in the complicated Dependency Court (818) 886-2525, fax (818) 350-6272, e-mail: process, is an experienced litigator, and has a GLADSTONE MICHEL WEISBERG WILL- [email protected]. Web site: www.kantorlaw keen awareness of the practical aspects of depen- NER & SLOANE, ALC .net. Contact Glenn Kantor or Alan Kassan. dency cases. Ms. Teske guides her clients toward Administrative appeals, litigation, state and federal 4551 Glencoe Avenue, Suite 300, Marina del Rey, the reunification/placement results they desire. court, appellate work, free consultations, and all CA 90292, (310) 821-9000, fax (310) 775-8775, Please see her Web site www.teskelaw.com for cases are taken on a contingency fee basis. See email: [email protected]. Web more detail. display ad on page 50. site: www.GladstoneMichel.com. Contact Gene Weisberg. Gladstone Michel attorneys have long LAW FIRM ISSUES HEALTHCARE LAW specialized in first and third party insurance cov- BERNE ROLSTON, PC CURTIS & GREEN LLP erage, bad faith litigation, and insurance fraud investigation. We are a highly respected leader in 2245 South Beverly Glen Boulevard, Suite 303, 701 North Brand Boulevard, Suite 200, Glendale, this field and service an increasingly diverse popu- Los Angeles, CA 90064, (424) 208-3820, fax CA 91203, (626) 585-9800, fax (626) 585-4186, lation of insurance carriers, handling precedent- (424) 208-3455, e-mail: [email protected]. Web site: e-mail: [email protected]. Web site: setting, high-exposure cases in state and federal www.rolston.net. Contact Berne Rolston. Ser- www.curtisgreenlaw.com. Contact Tom Curtis. courts, arbitrations and mediations, as well as the vices available: expert advice and guidance regard- Healthcare litigation; representation of physicians, more routine coverage matters. We have defending the organization of law firms, including mergers physician organizations and other licensed profes- ed thousands of claims arising out of catastrophic and acquisitions, and where necessary providing sionals; independent counsel to medical staffs; events such as the state’s wildfires and the 1994 testimony concerning, or assistance in resolving, licensing; disciplinary and peer review proceed- Northridge earthquake. issues or disputes between law firm members or ings; reimbursement issues.

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between present or former law firm member(s) and firm(s). See display ad on page 49. HELPING CLIENTS AND LAWYERS FOR 40 YEARS LEGAL MALPRACTICE GLADSTONE MICHEL WEISBERG WILL- Civil Litigation and Appeals, Intellectual Property, NER & SLOANE, ALC Defamation, Invasion of Privacy, Anti-SLAPP Motions, 4551 Glencoe Avenue, Suite 300, Marina del Rey, Entertainment Disputes, Civil Rights, First Amendment, CA 90292, (310) 821-9000, fax (310) 775-8775, e-mail: [email protected]. Web site: Constitutional, Tenure and Academic Freedom Issues www.GladstoneMichel.com. Contact Allen Michel. Gladstone Michel attorneys have more Experienced at co-counseling and consulting with attorneys than three decades of jury trial and appellate experience representing lawyers and law firms STEPHEN F. ROHDE and other professionals accused of professional ROHDE & VICTOROFF malpractice. Allen Michel, chair of the firm’s Pro- fessional Liability Group, has successfully tried 310.277.1482 • [email protected] major legal malpractice cases arising out of claimed errors ranging from negligence to conflicts of interest, violation of the Rules of Professional Conduct, and other breaches of fiduciary duty. Our REG AVID ERIN - EDIATOR RBITRATOR Professional Liability Group has represented attor- G D D M & A neys in a wide variety of substantive areas, including entertainment law and intellectual property mat- HONESTY • FAIRNESS • COMMITMENT • CREATIVITY • EXCELLENCE ters, real property and mechanics lien law, estate planning and tax issues, bankruptcy matters, and AREAS OF EXPERTISE: corporate advice, as well as in fee disputes, mali- • Entertainment and • Contract and Business Torts cious prosecution cases, anti-SLAPP motions and Intellectual Property • Real Property appeals, and disciplinary proceedings. • Employment • Corporate and Partnership LAW OFFICES OF CHRISTOPHER TM ROLIN “POWER MEDIATOR”, The Hollywood Reporter, ADR SuperLawyer FACULTY, Harvard Negotiation Institute 5707 Corsa Avenue, Suite 106, Westlake Village, CA 91362, (818) 707-7065, fax (818) 735-9992, e-mail: [email protected]. Web site: www 310.552.1062 ■ www.derin.com .chrisrolin.com. Contact Christopher Rolin. 10100 SANTA MONICA BOULEVARD, LOS ANGELES, CALIFORNIA 90067 Christopher Rolin is a highly effective trial attorney with over 42 years of trial activity in civil litigation. His area of emphasis is attorney malpractice, focusing on the applicable community standard of DAVID OSTROVE ■ ATTORNEY–CPA care for practicing attorneys in the litigation and transactional areas. He is now focusing as an Ca. Lawyer and CPA - 50+ years expert witness on trial and standards of care issues. He has been retained as an expert by both • Consultant and Expert Witness plaintiffs and defendants in legal malpractice • Professor of Law and Accounting cases. Also testifies on issues of professional • Author and Lecturer - CEB ethics and fee disputes. • Certified Specialist - Tax • Lawyer & Accountant Malpractice LEGAL MALPRACTICE EXPERT WITNESS • Notary Negligence & Fraud PHILLIP FELDMAN, BS, MBA, JD, • Financial Damage Computation ABPLA, AV 323.939.3400 ■ [email protected] 14401 Sylvan Street, Suite 208, Van Nuys, CA 91401, (818) 986-9890, fax (818) 986-1757, davidostrove.com e-mail: [email protected]. Web site: www .legalmalpracticeexperts.com. Contact Phillip Feldman. Board Certified in legal malpractice (ABPLA, ABA), Former Judge Pro Tem, state bar prosecutor, managing partner plaintiff’s and defense firms. LACBA 42 years, fee dispute arbi- ® trator 32 years, author, and lecturer. Testifies on LawBiz Management Company standard of care or conduct, fiduciary duties, cau- Your Practical Guide to ProfitTM sation/case within a case/underlying case on almost any matter-transactional, litigation, family, commercial, contract, tort, any case-in any state 310.827.5415 Phone or federal court. Also State Bar Defense Counsel 310.578.1769 Fax and preventative law. [email protected] E-mail LEMON LAW

LAW OFFICES OF DELSACK & www.lawbiz.com • www.lawbizblog.com ASSOCIATES, PC 1801 Century Park East, Suite 2400, Los Angeles, 421 HOWLAND CANAL, VENICE, CALIFORNIA 90291-4619 CA 90067, (310) 475-1700, fax (310) 475-1799,

Los Angeles Lawyer June 2010 53 June2010_IssueMaster.qxp 5/13/10 12:32 PM Page 54

e-mail: [email protected]. Web site: www Charles Pereyra-Suarez. Charles Pereyra- ation Roster of Neutrals, the Arbitration Panel of .lemonlawspecialists.com. Contact Kurt Del- Suarez has handled a broad range of civil and the International Film and Television Alliance (IFTA), sack. The Law Offices of Delsack & Associates, criminal matters during three decades of practice. and the WIPO Mediation and Arbitration Panels. P.C., have represented many thousands of Cali- Mr. Pereyra-Suarez’s experience includes com- Named by Los Angeles and Law & Politics maga- fornia consumers throughout the state in “lemon plex business litigation, white-collar criminal zines as a Super Lawyer in ADR, Intellectual Prop- law” cases, including automobiles, trucks, motor- defense, whistle-blower cases, international, gov- erty Litigation and Sports and Entertainment Law cycles, motor homes, and boats. We have ernment contracts, healthcare, environmental, (2006-2010), and by the Hollywood Reporter as a obtained recoveries totaling millions of dollars for antitrust, civil rights and First Amendment repre- “Power Mediator.” Greg concentrates his media- defective and unsafe vehicles. We enjoy a superb sentation. He is active as a mediator and arbitration practice on business, commercial, entertain- success rate and obtain speedy and full recoveries tor of various litigation and business disputes. ment, intellectual property, employment, and real without litigation in nearly all cases. Delsack & See display ad on page 49. estate matters. See display ad on page 53. Associates is known for experience, positive relationships with manufacturers, and speedy and LONG TERM CARE THE HOLMES LAW FIRM satisfactory settlements. 225 South Lake Avenue, Suite 300, Pasadena, CA KANTOR & KANTOR LLP 91101, (626) 432-7222, fax (626) 432-7223, LITIGATION 19839 Nordhoff Street, Northridge, CA 91324, e-mail: [email protected]. Web site: (818) 886-2525, fax (818) 350-6272, e-mail: www.theholmeslawfirm.com. Contact Reginald GLADSTONE MICHEL WEISBERG [email protected]. Web site: www.kantorlaw A. Holmes. Esq. Intellectual property, employ- WILLNER & SLOANE, ALC .net. Contact Glenn Kantor or Alan Kassan. ment and international law. Arbitrator, mediator, 4551 Glencoe Avenue, Suite 300, Marina del Rey, Administrative appeals, litigation, state and federal referee, special master, and private judge in the CA 90292, (310) 821-9000, fax (310) 775-8775, court, appellate work, free consultations, and all resolution of complex business disputes. See dis- e-mail: [email protected]. Web site: cases are taken on a contingency fee basis. See play ad on page 50. www.GladstoneMichel.com. Contact Allen display ad on page 50. Michel. Gladstone Michel attorneys have suc- NONPROFIT LAW cessfully litigated virtually every type of high-stakes LONG TERM DISABILITY complex litigation, from major insurance litigation MARSHALL A. GLICK, APC KANTOR & KANTOR LLP and business disputes to class actions, real estate 6345 Balboa Boulevard, #1-300, Encino, CA disputes, and entertainment and intellectual prop- 19839 Nordhoff Street, Northridge, CA 91324, 91436, (818) 345-2223, fax (818) 345-2263, erty litigation. We work closely with our clients from (818) 886-2525, fax (818) 350-6272, e-mail: e-mail: [email protected]. Web site: www pre-litigation counseling through all appeals to [email protected]. Web site: www.kantorlaw .glicklaw.com. Contact Marshall A. Glick. We achieve our clients’ business objectives. As a .net. Contact Glenn Kantor or Alan Kassan. form and represent public charities and private regional mid-size law firm, we offer the best of both Administrative appeals, litigation, state and federal foundations for your clients all over the country worlds: exceptional legal service at a fair cost. court, appellate work, free consultations, and all and for every religious, charitable, and educational cases are taken on a contingency fee basis. See purpose under heaven. GILCHRIST & RUTTER PROFESSIONAL display ad on page 50. CORPORATION PATENTS, TRADEMARKS & COPYRIGHTS 1299 Ocean Avenue, Suite 900, Santa Monica, MEDIATION DAVID M. KLEIMAN CA 90401, (310) 393-4000, fax (310) 394-4700. THE CALIFORNIA ACADEMY OF 21900 Burbank Boulevard, Third Floor, Woodland Web site: www.gilchristrutter.com. Contact DISTINGUISHED NEUTRALS Frank Gooch. Represent clients as plaintiffs and Hills, CA 91367, (818) 884-0949, fax (818) 884- (310) 341-3879, e-mail: director@californianeutrals defendants at trial and appellate levels in state and 2898, e-mail: [email protected]. Web .org. Web site: www.CaliforniaNeutrals.org. federal courts, as well as mediations/arbitrations. site: www.davidkleiman.com. Contact David M. Contact Darren A. Lee, Executive Director. Practice areas include insurance (e.g., coverage Kleiman. California trail lawyer and registered The California Academy of Distinguished Neutrals disputes, breach of contract, bad faith and puni- U.S. patent attorney David M. Kleiman represents is a professional association of mediators and tive damage actions), business (unfair competition, and advises businesses and individuals on litiga- arbitrators distinguished by their hands-on experi- antitrust, shareholder disputes, entertainment/i tion, transactions, investigations, and opinions pri- ence in the field of conflict resolution and by their ntellectual property litigation), real estate (breach marily in the areas of patents, trademarks, copy- commitment to the practice of alternative dispute of lease and sales agreements, quite title, ease- rights, trade secrets and related areas of business resolution. Membership is limited to neutrals who ment, owner-contractor and landlord-tenant dis- law. See display ad on page 46. have substantial experience in the resolution of putes, environmental clean-up) and securities commercial/civil disputes. Each attorney has (defense against enforcement actions brought by PERSONAL INJURY been recognized for their accomplishments the SEC, NASD and CDC). through the association’s peernomination proce- CHEONG, DENOVE, ROWELL & BENNETT HOLLAND & KNIGHT LLP dure and client interview process. The Academy 10100 Santa Monica Boulevard, Suite 2460, Los Angeles, CA 90067, (310) 277-4857, fax (310) 633 West Fifth Street, 21st Floor, Los Angeles, recognizes over 100 full-time ADR professionals 277-5254, e-mail: fi[email protected]. Web site: CA 90071-2040, (213) 896-2400, fax (213) 896- across the entire state and our Web site provides www.cdrb-law.com. Contact Lorraine Jackson 2450. Web site: www.hklaw.com. Contact Rex a useful resource to firms interested in searching for Jack Denove. Attorneys at Cheong, Denove, Fontenot. Holland & Knight is a global law firm for particular case experience or expertise. See Rowell & Bennett have successfully represented with more than 1,000 lawyers in 17 U.S. offices as display ad on page 30-31. clients for 30 years in medical malpractice, prod- well as Abu Dhabi, Beijing and Mexico City The GREG DAVID DERIN ucts liability, insurance bad faith, and catastrophic firm is among the nation’s largest law firms, pro- 10100 Santa Monica Boulevard, Suite 2300, Los injury and wrongful death actions. Senior Partner viding representation in litigation, business, real Angeles, CA 90067, (310) 552-1062, fax (310) Jack Denove has received numerous awards and estate and government law. Interdisciplinary prac- 552-1068, E-mail: [email protected]. Web site: recognition for his trial successes and commit- tice groups and industry-based teams provide www.derin.com. Contact Greg David Derin. ment to representing the rights of the injured, clients with access to attorneys throughout the Trained at Harvard Law School’s Mediation Work- including Trial Lawyer of the Year and Los Angeles firm, regardless of location. shop, which he has assisted in teaching for the Best Lawyer. He is past president of Consumer LAW OFFICES OF CHARLES PEREYRA- past 6 years, Greg brings more than 30 years of Attorneys Association of Los Angeles, and is a SUAREZ litigation experience to his role as a mediator. member of ABOT (Diplomate) and Consumer 445 South Figueroa Street, Suite 3200, Los Greg is a past Chair of the State Bar ADR Com- Attorneys of California (Board of Directors). See Angeles, CA 90071, (213) 623-5923, fax (213) mittee, a member of the California Academy of display ad on page 24. 623-1890, e-mail: cpereyra@cpslawfirm.com. Distinguished Neutrals, the CPR panel of Distin- Web site: www.cpslawfirm.com. Contact guished Neutrals, the American Arbitration Associ-

54 Los Angeles Lawyer June 2010 June2010_IssueMaster.qxp 5/13/10 12:32 PM Page 55

PRIVATE DISPUTE RESOLUTION COMMISSIONER ANITA RAE SHAPIRO Does LACBA have (RET) “Industry Specialists For Over 23 Years” your current Alternative Dispute Resolution. P.O. Box 1508, tWitkin & Eisinger we specialize in the Non-Judicial Brea, CA 92822-1508, cell (714) 606-2649, AForeclosure of obligations secured by real property e-mail address? phone/fax (714) 529-0415, e-mail: privatejudge or real and personal property (mixed collateral). @adr-shapiro.com. Web site: http://adr-shapiro When your client needs a foreclosure done profession- The Los Angeles County Bar .com. Contact Anita Rae Shapiro. Mediation, ally and at the lowest possible cost, please call us at: Association is your resource arbitration, temporary judge, accounting referee, for information delivered via e-mail discovery referee, in probate (wills, trust, on a number of subjects that conservatorships), family law, and all areas of civil impact your practice. law, including real estate. See display ad on Update your records online at page 24. www.lacba.org/myaccount or REAL ESTATE LAW call Member Services at 213.896.6560. GLADSTONE MICHEL WEISBERG WILLNER & SLOANE, ALC 4551 Glencoe Avenue, Suite 300, Marina del Rey, CA 90292, (310) 821-9000, fax (310) 775-8775, e-mail: [email protected]. Web DAVID L. RAY site:www.GladstoneMichel.com. Contact Arthur Grebow. Gladstone Michel has more than 45 Saltzburg, Ray & Bergman, LLP years combined experience representing real RECEIVERSHIP ACTIONS estate clients in the following areas: manufactured housing law, rent control, failure to maintain, hous- • Partnerships and Corporate Dissolutions ing discrimination, land use, unfair competition, • Government Enforcement Receivership Actions unlawful detainers, insurance claims, employment matters, personal injury defense, construction • Partition Actions/Marital Dissolution defect, mechanic lien enforcement, easements, licenses and boundary disputes, and bankruptcy TEL 310.481.6700 e-mail: [email protected] litigation. www.srblaw.com FAX 310.481.6707 12121 Wilshire Boulevard, Suite 600, Los Angeles CA 90025 REAL PROPERTY FORECLOSURES RICHARD G. WITKIN 530 S. Glenoaks Boulevard, Suite 207, Burbank, CA 91502, (818) 845-4000, fax (818) 845-4015. Contact Richard G. Witkin. Specializing in non- judicial foreclosures for the past 23 years. See display ad on this page. Why do we get most of our work RECEIVER/BANKRUPTCY from other attorneys? RECEIVERSHIP SPECIALISTS At Huron law group, referrals matter to us. We do what it 11400 W. Olympic Boulevard, Suite 200, Los takes to win and never, never give up. Angeles, CA 90064, (310) 552-9064, fax (310) We handle business, real estate and entertainment litigation. 552-9066, e-mail, john@receivershipspecialists .com. Web site: www.receivershipspecialists.com. Your success is our businessSM! Contact John Rachlin. Specialty area of law: H state and federal receivership/referee. Services available: We handle receivership and referee 310.284.3400 www.huronlaw.com Huron Law Group appointments in matters relating to residential real 1875 Century Park East, Suite 1000, Los Angeles, CA 90067 estate, commercial real estate, businesses and corporations, partnership and corporate dissolution construction projects, estate liquidations, portfolio liquidations, enforcements of judgments. See display ad on page 20.

SALTZBURG, RAY & BERGMAN, LLP 12121 Wilshire Boulevard, Suite 600, Los Angeles, CA 90025, (310) 481-6700, fax (310) 481-6707, e-mail: [email protected]. Web site: www.srblaw .com. Contact David L. Ray, Esq. Specializes in handling complex receivership matters, such as partnership and corporate dissolutions, including law ﬁrm dissolutions, and government enforcement receivership actions, including actions brought by the California Department of Corpora- tions, Department of Real Estate, Commodities Future Trading Commission, and Federal Trade Commission. Nationally recognized in both the

Los Angeles Lawyer June 2010 55 June2010_IssueMaster.qxp 5/13/10 12:33 PM Page 56

lender and litigation communities as qualified to TAXATION LAW expert4law–The Legal Marketplace assist in complicated and commercially sophisticated liquidations, reorganizations, and ongoing HOCHMAN, SALKIN, RETTIG, TOSCHER & business operations. See display ad on page 55. PEREZ Target 9150 Wilshire Boulevard, Suite 300, Beverly Hills, SOCIAL SECURITY DISABILITY/SSI CA 90212-3414, (310) 281-3200, fax (310) 859- 1430, e-mail: [email protected]. Web site: LAW OFFICE OF JERRY PERSKY Your Online www.taxlitigator.com. Contact Sharyn Fisk. The 5657 Wilshire Boulevard, Suite 410, Los Angeles, firm specializes in federal and state civil tax and Search CA 90036, (323) 938-4000, fax (323) 938-4068, criminal tax litigation controversies with federal, e-mail: [email protected]. 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Accident Reconstruction Specialists, p. 19 Greg David Derin, p. 46 Northwestern Mutual-The Beer Financial Group, p. 33 Tel. 562-743-7230 www.FieldAndTestEngineering.com Tel. 310-552-1062 www.derin.com Tel. 818-887-9191 www.beerﬁnancialgroup.com

Ahern Insurance Brokerage, p. 2 Guaranteed Subpoena, Inside Back Cover Ostrove, Krantz & Associates, p. 53 Tel. 800-282-9786 x101, [email protected] Tel. 800-PROCESS (776-2377) e-mail: [email protected] Tel. 323-939-3400 e-mail: [email protected]

The American Institute of Mediation, p. 6 Herb Fox, p. 49 Paciﬁc Health & Safety Consulting, Inc., p. 8 Tel. 213-383-0454 www.americaninstituteofmediation.com Tel. 805-899-4777 e-mail: [email protected] Tel. 949-253-4065 www.phsc-web.com

Berne Rolston, p. 49 Hochman Salkin Rettig Toscher and Perez, P.C., p. 51 Charles Pereyra-Suarez, p. 49 Tel. 424-208-3820 www.rolston.net Tel. 310-281-3200 www.taxlitigator.com Tel. 213-623-5923 www.cpslawﬁrm.com

Lee Jay Berman, Mediator, p. 4 The Holmes Law Firm, p. 50 Receivership Specialists, p. 20 Tel. 213-383-0438 e-mail: [email protected] Tel. 626-432-7222 www.theholmeslawﬁrm.com Tel. 310-552-9064 www.receivershipspecialists.com

Biehl, et al., CSR, Inc., p. 33 Huron Law Group, p. 55 Ringler Associates, p. 25 Tel. 800-208-6494 e-mail: [email protected] Tel. 310-284-3400 www.huronlaw.com Tel. 888-734-3910 www.ringlerassociates.com

The California Academy of Distinguished Neutrals, p. 30, 31 Jack Trimarco & Associates Polygraph, Inc., p. 9 Rohde & Victoroff, p. 53 Tel. 310-341-3879 www.CaliforniaNeutrals.org Tel. 310-247-2637 www.jacktrimarco.com Tel. 310-277-1482 www.rohde-victoroff.com

California Eminent Domain Law Group, APC, p. 20 James R. DiFrank, PLC, p. 48 Saltzburg, Ray & Bergman, LLP, p. 55 Tel. 818-957-0477 www.caledlaw.com Tel. 562-789-7734 www.bardefense.net Tel. 310-481-6700 www.srblaw.com

California Western School of Law, p. 57 Kantor & Kantor, LLP, p. 50 Anita Rae Shapiro, p. 24 Tel. 800-255-4252 www.californiawestern.edu Tel. 877-783-8686 www.kantorlaw.net Tel.714-529-0415 www.adr-shapiro.com

Chapman University School of Law, p. 1 Law Office of Michael Kelly, p. 39 Shoreline Investigations, p. 19 Tel. 877-CHAPLAW (877-242-7529) www.chaplaw.edu/law Tel. 310-393-0236 e-mail: admin@cﬂi.com Tel. 800-807-5440, 818-344-2193 www.shorelinepi.com

Cheong, Denove, Rowell & Bennett, p. 24 Law Office of David M. Kleiman, p. 46, Steinwald & Kaufman, CPA’s, p. 6 Tel. 310-277-4857 www.cdrb-law.com Tel. 818-884-0949 www.davidkleiman.com Tel. 310-207-9980 www.steinwaldkaufman.com

Coldwell Banker-Michael Edlen, p. 15 Lawyers’ Mutual Insurance Co., p. 7 Thomson West, Back Cover Tel. 310-230-7373 e-mail: [email protected] Tel. 800-252-2045 www.lawyersmutual.com Tel. 800-762-5272 www.west.thomson.com

Cook Construction, p. 15 Legal Tech, p. 11, Union Bank of California, p. 5 Tel. 818-438-4535 e-mail: [email protected] Tel. 800-537-2128 www.legaltechshow.com Tel. 310-550-6400 (B.H.), 213-236-7736

Lawrence W. Crispo, p. 8 Lexis Publishing, Inside Front Cover, p. 13 ValuEconomics, Inc, p. 46 Tel. 213-926-6665 e-mail: [email protected] www.lexis.com Tel. 323-653-9555 www.valu-econ.com

Law Offices of Vincent W. Davis & Associates, p. 38 MCLE4LAWYERS.COM, p. 4 Walzer & Melcher LLP, p. 37 Tel. 626-446-6442 www.vincentwdavis.com Tel. 310-552-5382 www.MCLEforlawyers.com Tel. 591-3700 www.walzermelcher.com

Dion-Kindem & Crockett, p. 46 Michael Marcus, p. 6 Witkin & Eisinger, LLC, p. 55 Tel. 818-883-4400 www.dkclaw.com Tel. 310-201-0010 www.marcusmediation.com Tel. 818-845-4000

Charles J. Fleishman, p. 48 Mina N. Sirkin, Esq., p. 38 Tel. 818-350-6285 www.erisarights.com Tel. 818-340-4479 www.SirkinLaw.com e-mail:

Steven L. Gleitman, Esq., p. 4 Clinton E. Miller, JD, p. 49 Tel. 310-553-5080 Tel. 408-279-1034 www.millerjd.qpg.com

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Asset Protection in a 3 rd Annual Small Firm and Solo Practitioners Conference Troubled Economy ON FRIDAY, JUNE 18, the Small Firm and Sole Practitioner Division will ON THURSDAY, JULY 1, the Los Angeles host its third annual conference. This year’s conference focuses on County Bar Association and the Small providing strategies and information to transform today’s challenges and Solo Division will host a program into tomorrow’s opportunities. The impressive lineup of speakers will about protecting assets from guide attendees through such topics as opening and running a law firm, plaintiffs and creditors. Speaker Jacob rainmaking for smalls and solos, building a social media strategy, Stein will cover specific planning strategies and solutions, including credit cards and compliance issues, and negotiation tips. The planning with community property, conference will take place at the Pasadena Convention Center, 300 East business entities, and domestic and Green Street in Pasadena. If you are interested in sponsoring or foreign trusts. Special emphasis will exhibiting at the event, please contact Paulette Fontanez at be placed on protecting assets in a [email protected] or 213-215-9416. The registration code number troubled economy, including is 010621. protection from lenders holding $199—CLE+PLUS member personal guarantees. The seminar $225—Small Firm and Sole Practitioner Division member will cover how to protect specific common assets: houses, bank and $350—LACBA member brokerage accounts, rental real $399—all others estate, businesses and professional 1 CLE hour practices, and retirement plans. The program will take place at the Los Angeles County Bar Association, 1055 Windows 7 and the Law Office West 7th Street, 27th floor, Downtown. Parking is available at ON TUESDAY, JUNE 8, the Los Angeles County Bar Association and the 1055 West 7th and nearby parking Small Firm and Sole Practitioner Division will host an online seminar, or lots. On-site registration will be Webinar, on Windows 7 led by Russell Jackman. Many law offices have not available at 4:30 P.M., with the upgraded since installing Windows XP, and lawyers still using it may want program continuing from 5:15 to 8:45 to attend this seminar, which will explain the functional differences P.M. The registration code number is between Windows 7 and Windows XP, what is new or upgraded, and how 010853. This event is also available these new features can benefit a law practice. The registration code as a live Webcast. The prices below number is 010712. Registration will be available from 11:30 to 11:45 A.M., include the meal. $60—CLE+PLUS member with the Webinar continuing from 11:45 A.M. to 12:45 P.M. $75—Small and Solo Division $45—CLE+PLUS member member $75—Small Firm and Sole Practitioner Division member $80—LACBA member $90—LACBA member $100—all others $125—all others 3.25 CLE hours

The Los Angeles County Bar Association is a State Bar of California MCLE approved provider. To register for the programs listed on this page, please call the Member Service Department at (213) 896-6560 or visit the Association Web site at http://calendar.lacba.org/where you will ﬁnd a full listing of this month’s Association programs.

Los Angeles Lawyer June 2010 59 June2010_IssueMaster.qxp 5/13/10 12:35 PM Page 60

closing argument BY HEATHER E. STERN

Healthcare Reform Should Not Follow MICRA’s Example

THIRTY-FIVE YEARS AGO, in response to rising medical malpractice Other examples include the plaintiff in American Bank & Trust,3 premiums, the California Legislature declared the existence of a who had to live with painful physical disfigurement and scars, and healthcare crisis. To address it, the Medical Injury Compensation several women I know who lost a fetus late in pregnancy due to med- Reform Act (MICRA) was created. ical negligence. These are primarily emotional, not economic, injuries, MICRA limits the ability of victims of medical malpractice to but they are injuries nonetheless. Like it or not, we are emotional obtain justice by reducing the damages that victims can recover. The beings, and traumatic memories can be more painful than a broken amount of recovery for noneconomic losses (pain, suffering, incon- leg, even if they cannot be found on an x-ray. venience, impairment, disfigurement, etc.) was capped at $250,000, Moreover, medical providers should not be shielded from the and no adjustment for inflation has been made since. MICRA also consequences of causing injuries any more than any other group. gives doctors the right to introduce evidence of collateral sources of People deserve to experience the consequences of their mistakes, income for victims, such as disability payments or benefits received under group health plans, so that the victims’ recovery amount may be reduced. The act further allows doctors Medical providers should not be shielded from the consequences to make periodic payments to satisfy any judgment that exceeds $50,000, without necessarily requiring the payment of interest. Further, of causing injuries any more than any other group. MICRA authorizes compulsory arbitration agreements in medical service contracts, depriv- ing patients of the right to a jury trial. Finally, in order to reduce the and negligent doctors are not excepted, especially considering the grav- incentive for lawyers to take medical malpractice cases, MICRA ity of the injuries they can cause. By what right did the legislature deter- reduces the amount of the contingency fee that victims can pay. mine that it is more important to have negligent doctors earning a good As a result of MICRA’s provisions, unless a victim of medical living than it is to ensure that there is justice for those they injure? malpractice has very serious economic damages (or, like Dennis Quaid, Tort reform advocates also like to deflect attention from the ready access to the media), it can be hard to find a lawyer and even plight of medical malpractice victims by attacking the victims and their more difficult to convince a doctor’s insurance company to make a rea- lawyers. Personal injury lawyers are demonized as money-grubbing sonable pretrial settlement offer. MICRA stacks the cards in favor of charlatans, and noneconomic damages are treated with derision and doctors and their insurers. It does not give victims any new rights or skepticism. When a jury finds liability, the justice system is called a remedies to level the scales for the rights that it takes away. Justice failure. This caricature is wrong. Personal injury specialists are enti- Stanley Mosk said it best in his dissent in American Bank & Trust tled to be paid for their expertise, just like anyone else, and victims Company v. Community Hospital, one of the cases rejecting a con- would gladly part with a percentage of something rather than get noth- stitutional challenge to MICRA: “This imprudent legislation pro- ing. The bargain between a lawyer and a client deserves as much vides benefits to the wrongdoer at the expense of his victim.”1 respect as any other contract. As for noneconomic damages, they are Only a few years after MICRA was enacted, statistics showed at real. And as for the jury system, medical malpractice cases are no more best a negligible overall effect on healthcare cost containment. complex than many other cases that go to trial. An expert and a lawyer Malpractice premiums declined, but the cost of hospitalization con- should be able to explain medical facts to jurors. If not, shame on the tinued to rise. If MICRA had solved the healthcare crisis that lawyer and expert, not the jurors. California was experiencing in 1975, it would be unlikely that so many Doctors compelled to follow the latest federal healthcare reform Californians would have seen the need for the recent federal health- guidelines will want some form of immunity from suits stemming from care reform. cost-cutting measures. If MICRA is any harbinger of things to come, Whether or not MICRA has significantly reduced healthcare costs the victims of medical negligence will still be bearing the brunt of in California, the last 35 years offer many examples of the heavy price reform in 2045. ■ that has been paid by malpractice victims. Put simply, the law is unjust. For example, James Van Buren’s doctors diagnosed him with a peri- 1 American Bank & Trust Co. v. Community Hosp., 36 Cal. 3d 359 (1984) (Mosk, anal abscess and recommended surgery, during which Van Buren’s doc- J., dissenting). 2 tor negligently severed one of Van Buren’s muscles, causing Van Van Buren v. Evans, No. 146178 (5th Dist. May 20, 2009) (unpublished). 3 American Bank & Trust Co., 36 Cal. 3d 359. Buren to suffer permanent fecal incontinence. At trial, the jury determined his damages for a lifetime of incontinence to be $2.5 million. Following MICRA, the judge reduced the amount to the cap, Heather E. Stern is a partner with Kralik & Jacobs LLP, where she specializes $250,000, a reduction that was later upheld on appeal.2 in real estate and banking litigation

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