Justia California Court of Appeals Opinion Summaries

In this case, plaintiffs Brandi Stiles and Abel Gorgita purchased a 2011 Kia Optima in April 2013. The car, manufactured and distributed by Kia Motors America, Inc., was sold with express warranties still in effect from the original sale. However, the car had serious defects, including issues with the transmission, electrical system, brakes, engine, suspension, and steering. Despite multiple attempts, Kia was unable to repair these defects. The plaintiffs argued that Kia failed to replace the car or make restitution as required under the Song-Beverly Consumer Warranty Act.The trial court sustained Kia's demurrer, arguing that the remedies sought by the plaintiffs under the Song-Beverly Act only apply to new motor vehicles. The court relied on a previous case, Rodriguez v. FCA US, LLC, which held that a used motor vehicle with an unexpired warranty is not a "new motor vehicle" under the Song-Beverly Act. The court rejected another case, Jensen v. BMW of North America, Inc., which held that a previously owned motor vehicle with an unexpired warranty qualifies as a "new motor vehicle" under the Song-Beverly Act.The Court of Appeal of the State of California Second Appellate District Division Six reversed the trial court's decision. The court held that a previously owned motor vehicle purchased with the manufacturer’s new car warranty still in effect is a “new motor vehicle” as defined by section 1793.22, subdivision (e)(2) of the Song-Beverly Act. Thus, the replace or refund remedy of section 1793.2, subdivision (d)(2) applies. The court rejected Kia's arguments and affirmed the interpretation of the Song-Beverly Act in Jensen v. BMW of North America, Inc. The court also modified the opinion to clarify the interpretation of the implied warranty provisions. View "Stiles v. Kia Motors America, Inc." on Justia Law

Five diabetic patients, Henry J. Hebert, Traci Moore, Aliya Campbell Pierre, Tiffanie Tsakiris, and Brenda Bottiglier, were prescribed the Dexcom G6 Continuous Glucose Monitoring System (Dexcom G6) to manage their diabetes. The device allegedly malfunctioned, failing to alert them of dangerous glucose levels, resulting in serious injuries and, in Hebert's case, death. The patients and Hebert's daughters filed separate product liability actions against Dexcom, Inc., the manufacturer. Dexcom moved to compel arbitration, arguing that each patient had agreed to arbitrate disputes when they installed the G6 App on their devices and clicked "I agree to Terms of Use."The trial court granted Dexcom's motions to compel arbitration in all five cases. The plaintiffs petitioned the appellate court for a writ of mandate directing the trial court to vacate its orders compelling them to arbitrate. The appellate court consolidated the cases and issued an order directing Dexcom to show cause why the relief sought should not be granted.The appellate court concluded that the trial court erred. Although a clickwrap agreement, where an internet user accepts a website’s terms of use by clicking an “I agree” or “I accept” button, is generally enforceable, Dexcom’s G6 App clickwrap agreement was not. The court found that Dexcom undid whatever notice it might have provided of the contractual terms by explicitly telling the user that clicking the box constituted authorization for Dexcom to collect and store the user’s sensitive, personal health information. For this reason, Dexcom could not meet its burden of demonstrating that the same click constituted unambiguous acceptance of the Terms of Use, including the arbitration provision. Consequently, arbitration agreements were not formed with any of the plaintiffs. The court granted the petitions and directed the trial court to vacate its orders granting Dexcom’s motions to compel arbitration and to enter new orders denying the motions. View "Herzog v. Superior Court" on Justia Law

In April 2013, Brandi Stiles and Abel Gorgita purchased a 2011 Kia Optima, which was manufactured and distributed by Kia Motors America, Inc. At the time of purchase, some of Kia's original warranties were still in effect, including the basic and drivetrain warranties. The car developed serious defects covered by the warranties, including issues with the transmission, electrical system, brakes, engine, suspension, and steering. Despite multiple attempts, Kia was unable to repair the defects. Stiles and Gorgita alleged that Kia failed to replace the car or make restitution as required under the Song-Beverly Consumer Warranty Act.Kia demurred to the first amended complaint, arguing that the remedies sought under the Song-Beverly Act apply only to new motor vehicles, and the car purchased by Stiles and Gorgita was not a "new motor vehicle" as defined in the Act. The trial court sustained Kia's demurrer, relying on a previous case, Rodriguez v. FCA US, LLC, which held that a used motor vehicle with an unexpired warranty is not a "new motor vehicle" under the Song-Beverly Act.The Court of Appeal of the State of California Second Appellate District Division Six reversed the trial court's decision. The court held that a previously owned motor vehicle purchased with the manufacturer’s new car warranty still in effect is a “new motor vehicle” as defined by the Song-Beverly Act. Therefore, the replace or refund remedy of the Act applies. The court rejected Kia's argument that the Act's definition of a "new motor vehicle" should be limited to vehicles that have never been previously sold to a consumer and come with full express warranties. The court also rejected Kia's argument that Stiles and Gorgita's interpretation of the Act conflicts with its implied warranty provisions. View "Stiles v. Kia Motors America, Inc." on Justia Law

This case involves Stewart Johnston who was the defendant, cross-complainant, and appellant, against BTHHM Berkeley, LLC, PNG Berkeley, LLC, Michail Family 2004 Living Trust, Bianca Blesching, Scot Hawkins (collectively, BTHHM), and Holda Novelo and Landmark Real Estate Management, Inc. (collectively, Landmark). Johnston owned a property which he was to lease to BTHHM for a cannabis dispensary once permits were granted by the City of Berkeley. However, after the city approved the permit, Johnston refused to deliver possession of the property to BTHHM, leading to a lawsuit by BTHHM against Johnston.Following mediation, a two-page term sheet titled “Settlement Term Sheet Agreement” was signed by all parties. Johnston later wished to withdraw from the agreement. BTHHM and Landmark moved to enforce the term sheet pursuant to section 664.6 of the Code of Civil Procedure, which the court granted. Johnston failed to make the payments required by the enforcement orders. The court granted BTHHM's motion for entry of judgment, awarded prejudgment interest to BTHHM, entered judgment against Johnston, and dismissed his cross-complaint with prejudice.The Court of Appeal of the State of California First Appellate District Division Four reversed the trial court’s award of prejudgment interest but otherwise affirmed the decision. The court held that substantial evidence supported the trial court’s finding that the term sheet’s language evinces the parties’ mutual agreement to settle the case according to its terms. However, the court concluded that the award of prejudgment interest was unauthorized as it differed materially from the terms of the parties’ agreement. View "BTHHM Berkeley, LLC v. Johnston" on Justia Law

In this case, Damien T. Davis and Johnetta H. Lane ("the plaintiffs") filed suit against Nissan North America, Inc. and Nissan of San Bernardino ("Nissan") after they allegedly bought a faulty Nissan vehicle with a defective transmission. Nissan attempted to compel arbitration as per the arbitration clause in the sale contract between plaintiffs and the dealership. However, the trial court denied the motion, ruling that Nissan, not being a party to the contract, could not invoke the clause based on the doctrine of equitable estoppel.Nissan appealed the decision, arguing that the trial court erred by refusing to compel arbitration based on equitable estoppel. However, the Court of Appeal, Fourth Appellate District Division One, State of California, agreed with the trial court's ruling reasoning that Nissan's reliance on the doctrine of equitable estoppel was misplaced. It explained that equitable estoppel applies when a party's claims against a non-signatory are dependent upon the underlying contractual obligations. Here, the plaintiffs' claims were not founded on the sale contract's terms, but rather on Nissan's statutory obligations under the Song-Beverly Act relating to manufacturer warranties. The court concluded that the plaintiffs are pursuing their statutory and tort claims in court, and there was no inequity in allowing them to do so.Therefore, Nissan's motion to compel arbitration was denied, and the trial court's order was affirmed. View "Davis v. Nissan North America, Inc." on Justia Law

The case involves Applied Medical Distribution Corporation (Applied) suing its former employee, Stephen Jarrells, for misappropriation of trade secrets, breach of a contract governing Applied’s proprietary information, and breach of fiduciary duty. The trial court granted Applied’s posttrial motion for a permanent injunction and awarded Applied partial attorney fees, costs, and expenses.On appeal, the Court of Appeal of the State of California affirmed in part, reversed in part, and remanded for further proceedings. The court concluded that Applied was the prevailing party on the misappropriation cause of action and was entitled to a permanent injunction to recover its trade secrets and prevent further misappropriation. The court also found that Applied was entitled to an award of the reasonable attorney fees, costs, and expenses it incurred to obtain injunctive relief.However, the court disagreed with the trial court's decision to mechanically award only 25 percent of the incurred attorney fees and costs because Applied prevailed on only one of four claims it asserted. The court found that the trial court erred in how it determined the amount awarded by failing to address the extent to which the facts underlying the other claims were inextricably intertwined with or dependent upon the allegations that formed the basis of the one claim on which Applied prevailed. The court also found that the trial court erred in excluding certain expert witness fees from the damages calculation presented to the jury.Finally, the court concluded that the trial court erred by granting a nonsuit on whether Jarrells’s misappropriation was willful and malicious, and remanded for a jury trial on this issue. If the jury finds the misappropriation was willful and malicious, the court shall decide whether attorney fees and costs should be awarded to Applied and, if so, in what amount. View "Applied Medical Distribution Corp. v. Jarrells" on Justia Law

In California, VFLA Eventco, LLC (VFLA), a music festival organizer, sued Starry US Touring, Inc., Kali Uchis Touring, Inc., Big Grrrl Big Touring, Inc., and William Morris Endeavor Entertainment, LLC (WME) over the return of deposits paid to secure the performances of Ellie Goulding, Kali Uchis, and Lizzo at VFLA’s music festival scheduled for June 2020. Due to the COVID-19 pandemic and government restrictions, VFLA cancelled the festival and demanded the return of the deposits from WME, who negotiated the performance contracts and held the deposits as the artists’ agent. VFLA claimed its right to the deposits under the force majeure provision in the parties’ performance contracts. The artists refused VFLA’s demand, claiming VFLA bore the risk of a cancellation due to the pandemic. The trial court granted summary judgment in favor of the artists and WME.The Court of Appeal of the State of California Second Appellate District affirmed the judgment, holding that the trial court properly granted summary judgment in favor of the artists and WME. The court interpreted the force majeure provision as not reasonably susceptible to VFLA’s interpretation, and favoring the artists. The court also held that the artists’ interpretation did not work an invalid forfeiture or make the performance contracts unlawful. View "VFLA Eventco, LLC v. William Morris Endeavor Entertainment, LLC" on Justia Law

In the case, a group of students from the University of San Francisco (USF) sued the university for breach of contract, alleging that the university did not deliver on its promise to provide in-person instruction and should refund a portion of their tuition fees due to the transition to remote learning during the COVID-19 pandemic. The Court of Appeal of the State of California, First Appellate District, Division Three affirmed the trial court's decision, which granted USF's motion for summary adjudication, concluding that the students failed to raise a triable issue of fact regarding whether USF promised to provide exclusively in-person instruction.The court determined that there was an implied-in-fact contract between USF and the student appellants, established through matriculation and the payment of tuition. However, the court found that the contract did not explicitly promise exclusively in-person instruction. The court also distinguished between general expectations of in-person classes and enforceable contractual promises for exclusively in-person instruction. The court held that the students failed to establish a breach of contract based on the transition to remote learning during the COVID-19 pandemic.The court further held that the students could not pursue quasi-contract claims, as a valid and enforceable contract existed between the students and USF. The students' promissory estoppel claim also failed, as they did not establish any clear and unequivocal promises from USF for in-person instruction. The court stated that the record did not reflect any such promise.The court dismissed the students' claims relating to the Fall 2020 and Spring 2021 semesters, as they were aware these semesters would be conducted either entirely remotely or in a hybrid format prior to enrolling or paying tuition for those semesters. Thus, the students could not reasonably have believed USF contractually promised to provide in-person education for these semesters. View "Berlanga v. University of San Francisco" on Justia Law

In the case of Maryann Jones v. Solgen Construction, LLC and GoodLeap, LLC, the Court of Appeal of the State of California Fifth Appellate District affirmed the trial court's decision not to compel arbitration. The case concerned a business relationship involving the installation of home solar panels. The appellants, Solgen Construction and GoodLeap, had appealed the trial court's denial of their separate motions to compel arbitration, arguing that the court had erred in several ways, including by concluding that no valid agreement to arbitrate existed.Jones, the respondent, had filed a lawsuit alleging fraudulent misrepresentation, fraudulent concealment, negligence, and violations of various consumer protection laws. She contended that she had been misled into believing she was signing up for a free government program to lower her energy costs, not entering into a 25-year loan agreement for solar panels. The appellants argued that Jones had signed contracts containing arbitration clauses, but the court found that the appellants had failed to meet their burden of demonstrating the existence of a valid arbitration agreement. The court also held that the contract was unenforceable due to being unconscionable.The appellate court affirmed the trial court's decision, rejecting the appellants' arguments that an evidentiary hearing should have been held and that the court had erred in its interpretation of the evidence and the law. It found that the trial court had not abused its discretion and that its finding that the appellants failed to meet their burden of proof was not erroneous as a matter of law. View "Jones v. Solgen Construction" on Justia Law

The plaintiff, SanJuana Andrade, filed a lawsuit against the Western Riverside Council of Governments (Council) on the basis that she had been fraudulently enrolled in a Property Assessed Clean Energy (PACE) program. She claimed that her signature was forged on the PACE loan agreements, resulting in a lien on her home and increased property tax assessments that she had not agreed to. Following an investigation by the state Department of Financial Protection and Innovation, which confirmed the contractors’ fraud, the Council released its assessment and the lien on Andrade’s home. In January 2022, Andrade filed a motion for attorney’s fees and costs under Civil Code section 1717, which provides for attorney’s fees in any action on a contract where the contract specifically provides for such fees. The trial court denied Andrade’s motion, concluding that the contractual fee provisions were limited in scope and did not entitle Andrade to attorney’s fees because they concerned fees for “a judicial foreclosure action.”On appeal, the California Court of Appeal, Fourth Appellate District, Division One, reversed the trial court's decision. It held that under section 1717, a fee provision must be construed as applying to the entire contract unless each party was represented by counsel in the negotiation and execution of the contract, and the fact of that representation is specified in the contract. The Court found that limiting the fee provisions to foreclosure proceedings would be the precise kind of lopsided arrangement that section 1717 prohibits. The Court remanded the case back to the trial court to determine whether Andrade is “the party prevailing on the contract” and therefore entitled to attorney's fees. View "Andrade v. Western Riverside Council of Governments" on Justia Law