Can a San Diego Business Litigation Attorney Help if Your Company is Sued?

A San Diego business litigation attorney can provide legal representation to companies involved in a variety of disputes. Businesses can be sued for many different reasons, whether the lawsuit arises from an alleged breach of contract, a personal injury or allegations made by a disgruntled employee.

While there are myriad possible causes of action that can result in a business being forced to defend itself, the goals of most civil cases are the same: plaintiffs want to obtain a monetary remedy from the company or plaintiffs wish to obtain some other type of remedy, such as the court ordering a defendant to refrain from or engage in a particular type of behavior like following through on contractual obligations or re-hiring an employee who was wrongfully terminated. A San Diego business litigation attorney will work with businesses to develop the right legal strategy, whether that involves settling or defending a case in court.

How a Business Litigation Attorney Helps Your Company Settle Lawsuits

According to the New York Times, anywhere from 80 to 92 percent of civil cases settle. Cases settle for a reason: it is often more costly and risky for a company to go to court. In 24 percent of cases, defendants made the wrong choice about whether to proceed to trial and ended up paying more than they could have paid to settle the case. When defendants were wrong about going to trial and had to pay plaintiffs more than they could have settled for, the difference was substantial. Defendants who went to trial when they shouldn’t have paid around $1.1 million more than settling expenses would have cost.

Whether to settle or not will depend upon factors including the amount a company can afford, the damage to the company’s reputation that can come from a prolonged trial and the strength of the plaintiff’s case.

Determining whether settling is likely to permit your business to keep more money can be highly subjective and requires years of experience to predict. Factors that can impact whether to settle include the likelihood of a plaintiff’s victory, the strength of the plaintiff’s evidence, the availability and feasibility of affirmative defenses, potential legal remedies that a plaintiff is seeking, and possible damage to your company’s reputation if a trial is publicized. Because many considerations require knowledge of precedent and an understanding of the statutes under which a plaintiff’s claims arise, companies named as defendants in a lawsuit can benefit tremendously by retaining a litigation attorney before deciding how to proceed.

How a Business Litigation Attorney Helps Your Company Fight in Court

When your company is sued, fighting in court is sometimes the best course of action, such as in the case of  frivolous lawsuit. It may be, in appropriate instances, worth the added expense and time of going to trial to vigorously defend a frivolous lawsuit and prevail at trial. This can establish a precedent that you will not reward parties for filing frivolous lawsuits, preventing such suits from being filed against your business down the road. Frivolous lawsuits are a serious problem within the legal system. A recent article in theWall Street Journal indicates every family in the U.S. loses as much as $3,520 annually due to costs associated with frivolous lawsuits. You can avoid making your business an easy target for such suits by not backing down if your business is the target of frivolous claims.

A defendant who wishes to defend against a case in court will need to introduce doubt as to their liability or breach of legal duty, or will need to raise affirmative defenses justifying their conduct. Juries don’t have to be 100 percent convinced of a defendant’s liability to find for a plaintiff. There is a lower burden of proof in civil cases than criminal ones, so plaintiffs must only show liability by a preponderance of the evidence. This lower standard of proof makes it easier, but not easy, for plaintiffs to win and vital for defendants to be able to introduce significant doubt in the plaintiff’s evidence.

Affirmative defenses such as a plaintiff’s misuse of a product in an injury claim, a bona-fide job-related reason for an employer’s actions in an employment dispute, or an intervening act as justification for breach of contract will need to be proved if these defenses are to allow a defendant to avoid an adverse ruling.  A litigation attorney can provide assistance in introducing doubt or proving affirmative defenses.

Getting Help from A San Diego Business Litigation Attorney

The business litigation attorneys at Gehres Law Group have a long track record of representing companies in San Diego and surrounding areas when those businesses have been sued. We understand the financial and reputational damage that can result from legal action and our firm helps you to resolve the claims against you as quickly and cost-effectively as possible.

To find out more about the ways in which a San Diego business litigation attorney at our firm can help you with the development of a legal strategy and with the execution of that strategy to get the best possible outcome in your case, give us a call at 858-964-2314 or contact us online today.

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How a Business Lawyer Helps Your Company Avoid a Lawsuit

A San Diego business attorney provides assistance to your company in taking proactive steps to avoid litigation. Gehres Law Group will work closely with you to identify potential areas of conflict that could result in litigation and will help you reduce the potential that your company will become a defendant in a civil case.

How a San Diego Business Attorney Helps Avoid Contract Litigation

Many companies enter into myriad different contracts, from a lease for the premises from which they will operate, to financing agreement, licensing deals, or contracts with suppliers to purchase materials or goods. While the Uniform Commercial Code aims to resolve problems that commonly arise in business contracts, including issues that are caused by companies using different forms for the same transaction, contracts still must involve an offer, an acceptance, and a meeting of the minds to be enforceable.

Contracts that are too vague, that do not include clauses protecting your interests, or that contain terms that are against public policy could result in your company facing a lawsuit or result in your company being forced to initiate a lawsuit. By appropriately drafting contracts with the help of an attorney, and including necessary clauses to protect your interests, your company can reduce the chances of a conflict with a customer or supplier that results in litigation.

You may wish, for example, to include arbitration clauses in customer contracts so customers will be required to resolve issues in arbitration rather than in a costlier lawsuit that could result in a larger plaintiff’s verdict. Recent Supreme Court decisions, including AT&T Mobility v. Concepcion, have provided companies with more power to use arbitration clauses to prevent costly class actions. While the Consumer Financial Protection Bureau (CFPB) has taken steps to curtail these clauses in certain industries, it is still possible for many businesses to use contracts in strategic ways to reduce litigation risks- with the help of a qualified lawyer who can provide advice on acting within the bounds of the law.

How a San Diego Business Attorney Helps Avoid Employment Litigation

Businesses may be sued by employees for wrongful termination or discrimination. Employees could also potentially make wage-and-hour claims if you do not comply with minimum wage laws, overtime laws, and other regulations associated with worker payment. If an employee gets hurt at work, the employee typically cannot sue but may file a workers’ compensation claim, which could also cost your company more money in premium costs – and the injury could also prompt an investigation by the Occupational Safety and Health Administration.

California law is very protective of workers and both state and federal law provide broad protection from discrimination including disparate impact discrimination and hostile work environment discrimination.

For example, hostile work environment claims may be successfully brought against your company based on alleged discriminatory conduct if co-workers create an unpleasant work environment based on a protected classification, unless there was a procedure in place for reporting harassment which was properly communicated to employees and the company takes prompt action in response to a complaint by an employee. If the employee did not make a report, or if your business took appropriate action in response to one, you could avoid liability by raising affirmative defenses. Disparate impact discrimination, on the other hand, occurs if a job requirement has the “effect” of disqualifying people of a protected class. Your company could defend against a claim of disparate impact discrimination if you ensure you impose qualification requirements only if they have a “bona fide” relationship to the job each candidate being hired to perform. It is best to get legal advice on how to be proactive in avoiding a lawsuit through instituting proper workplace policies and procedures.

How a San Diego Business Attorney Helps Avoid Injury Litigation

Your company is at risk of being sued if someone gets hurt using your products or gets hurt on your premises. Avoiding litigation necessitates understand the legal duty you owe to customers and visitors. For example, if you invite people onto your premises for commercial purposes, you must routinely inspect the property for hazards that could cause injury. You must correct problems with the property that create the injury risk and/or must provide warning to visitors of risk that cannot be reasonably mitigated.

Getting Help from A San Diego Business Attorney

In addition to assisting you in taking proactive steps to reduce the chances of being sued, our legal team can also help you to respond when a claim is made against you. We are skilled and experienced litigators who have successfully helped many companies prevail in court or to quickly and effectively resolve claims. To find out more about the assistance a San Diego business attorney at our firm can provide to you, give us a call at 858-964-2314 or contact us online today.

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5 Ways Business Lawyers Help Startups

Startups in San Diego should reach out to the business lawyers at Gehres Law Group to help get their company off to a solid start as they begin operations. Only around 1/3 of new businesses that open up will make it past their 10th anniversary, according to The Motley Fool, but your business can maximize the chances of becoming one of them by making the right choices from day one. 

Business lawyers can help new companies in many different ways to protect their competitive advantage, to minimize risk and to develop a plan for the future. Attorneys also assist those who are starting companies in finding ways to protect their personal wealth from losses if something goes wrong with the business.

Gehres Law Group will tailor the services our firm provides to your new company’s needs. To give you an idea of what business lawyers do, consider five of the most common services business law attorneys provide to startups.

Choosing the Right Business Entity

Many new business owners run their business as a sole proprietorship or partnership either by default (because they fail to choose another business structure) or because they don’t have a full understanding of other options. Unfortunately, both sole proprietors and partners face significant personal risk of liability because the proprietor or partner is viewed as the same legal entity as the company. A judgement against the business, lawsuits and business bankruptcy can put personal wealth in jeopardy.

Other business structures including Limited Liability Companies, Limited Partnerships, S-corporations and C-corporations provide liability protection and, in many cases, also offer enhanced tax flexibility and other benefits. For example, if you form an S-corporation, you can choose to characterize some of your income from your business as a distribution rather than wage income, allowing you to avoid paying FICA taxes on that income. This is legal and allowable, as long as you pay yourself a reasonable compensation for services rendered to the business.

Being Smart About Contracts You Sign

Startups may have to sign contracts with investors; with suppliers; with a landlord they are leasing from; and with a host of other individuals and business entities. Disadvantageous contracts could make it difficult or impossible to achieve business success. In fact, many businesses have declared bankruptcy under Chapter 11 because their companies needed to re-negotiate contracts that were making profitability impossible. By negotiating contracts to protect business interests, and having contracts reviewed by an attorney to ensure they contain appropriate protective clauses, you can reduce the likelihood that an agreement adverse to your interests will render your company unprofitable.

Hiring Employees While Protecting Your Organization

Many startups must hire employees to help their companies operate and grow. Hiring employees unfortunately makes your business vulnerable to wrongful termination lawsuits, unemployment claims, workers’ compensation claims, and OSHA citations if a worker gets hurt on-the-job. Employees could also potentially share trade secrets, go to work for competitors, or steal clients and go into direct competition with your business.

California has some of the strictest anti-discrimination laws in the country under the state’s Fair Employmnt and Housing Act. Califronia also has more stringent worker protection laws than many other states, including laws such as the California Family Rights Act, which requires employers who have 50 or more employees to provide job-protected leave upon the birth or adoption of a child or if the employee or a family member develops a serious health condition.

There are options to protect yourself from the risks that employees present. Non-disclosure agreements are one way to protect secrets. Knowing the laws on workplace safety and discrimination will also help your company avoid inadvertent and costly mistakes.

Reviewing Financing Options

You may be taking out a loan or seeking investors or partners. There are pros and cons to each option. Loans put all the risk on you – but you get the possibility of all the rewards.

As one entrepeneur explained in Forbes, making the decision to raise outside capital is difficult, but company growth was limited due to insufficient funding so ultimately it was better for his business to accept outside funding in order to accelerate development.

While each business owner must weigh trade-offs of funding options independently, it is critical to understand the terms of financing or investment agreements in order to make informed choices regarding the best approach to securing funding for startups.

Protecting Your Intellectual Property

Your company may have a unique process to get work done, a creative design the company wants to sell, and a brand identity you are trying to cultivate. You want your logos, work processes and creative ideas to actually belong to your organization. Intangible property has value – often a significant one – and you need to find a way to protect your intellectual property.

Patents, trademarks and copyrights can protect logos, inventions, processes, creative product, and your company’s brand identity. Obtaining intellectual property protection will require submitting applications to the US Patent & Trademark Office or the U.S. Copyright Office. You will be eligible for protection only if your ideas are original ones and you can prove you meet the relevant criteria. If you wish to obtain a patent, for example, your invention must meet certain requirements: it must be new, useful, and non-obvious..

Getting Help from San Diego Business Lawyers

Whether your company is a startup or is an established business in San Diego or surrounding areas, business lawyers at Gehres Law Group can provide you with personalized legal advice to protect the business and to protect your investment within it. To find out more about how our firm can help you, give us a call at 858-964-2314 or contact us online today.

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CALIFORNIA LABOR CODE §925: Limitations on Employer’s Choice of Law and Forum Selection Provisions

It is no secret that California labor laws are some of the most employee friendly in the nation. Because of this, many out-of-state employers with employees who work in California have attempted to prevent these employees from: a) pursuing legal action against the employers in California; and/or, b) asserting claims based on the California Labor Code. This has been accomplished by inserting choice of law and forum selection clauses in employment agreements, which require employees to litigate or arbitrate in a state other than California, and/or require that the trier of fact apply another state’s laws.

For example, few states have abolished employment-related non-compete agreements as has occurred in California. Therefore, to prevent a California employee from competing with the employer following termination of his/her employment, a Texas based employer may include non-compete language and require that Texas law be applied in any legal proceedings concerning the employee’s employment (where non-competition language is generally enforceable, with some limitations), and require that any disputes be heard by a Texas court or arbitrator.

California Labor Code §925 is a direct attack on such practices.

Legislative Policy and Purpose of §925

In a previous version of the bill that became §925, the stated legislative policy and purpose was to “ensure that all persons have the full benefit of the rights, penalties, remedies, forums, and procedures established in the Labor Code, and that individuals not be deprived of those rights, penalties, remedies, forums, or procedures through the use of involuntary or coerced waivers;” and to “ensure that a contract to waive any of the rights, penalties, remedies, forums, or procedures under the Labor Code…is a matter of voluntary consent, not coercion.”[Emphasis added]. Click here for text. Although this language did not make it into the adopted version of the Labor Code, litigants involved in a dispute concerning the prohibitions of §*925 can anticipate that this new law will be construed broadly by California Courts for the purpose of safeguarding rights provided under California’s Labor Code, as indicated by these statements.

To this end, the adopted version of §925 expressly states that employers may not require, as a “condition of employment,” an employee to adjudicate their claims outside of California for claims “arising in California.” Furthermore, any agreement which violates §925 is “voidable by the employee” and if so voided, “the matter shall be adjudicated in California and California law shall govern the dispute.”  If an employer nonetheless pushes a matter to trial, this new law also provides Courts with the ability to award reasonable attorney’s fees to employees who assert their rights pursuant to this Section. Therefore, employers who wish to insert forum selection and choice of law provisions electing a forum other than California or application of laws other than California run a real risk of seeing such language voided and attorney’s fees being assessed against them.

Applicability of §925

This new law expressly applies to employment-related agreements which are entered into, modified or extended on or after January 1, 2017. Therefore, agreements which predate this effective date are not affected, although there is case law to support the invalidity of the offending provisions in certain circumstances already. In addition, subsection 2(e) states that §925 is inapplicable to an employee “who is in fact individually represented by legal counsel in negotiating the terms of an agreement to designate either the venue or forum in which a controversy arising from the employment contract may be adjudicated or the choice of law to be applied.” And, if an employee works in multiple states, but not primarily in California, the prohibitions of §925 are also inapplicable. One might also anticipate that California Courts may conclude that severance agreements, which are by definition not a condition of employment, fall outside the ambit of §925.

Apart from these exceptions, employers can expect that these stated prohibitions will be applied to all employment-related contracts and materials, including employee handbooks or manuals, at-will agreements, confidentiality and nondisclosure agreements, arbitration agreements, and invention and assignment agreements.

Conclusions

While California Courts have yet to interpret §925, it is clear that out-of-state employers who wish to insert choice of law and forum selection clauses which are contrary to this Section into their employment-related agreements for their California based employees, should, at a minimum, consider the following:

1. Ensure that such agreements do not include language indicating that the terms of the agreement, or at least the prohibited clauses, are a condition of employment. It’s also likely best to affirmatively state that such clauses are not mandatory or a condition of employment (which could potentially leave the clauses open for attack on other grounds);
2. Include express language indicating that the agreement was entered into knowingly and voluntarily by the employee (best to make such language conspicuous) and that the employee did not execute the agreement under duress or as a result of coercion;
3. Most importantly, require that the employee retain California counsel to assist in negotiating the terms of the agreement and include language in the contract indicating that the employee has been represented by counsel during the negotiation process.

For out-of-state employers who do not wish to take these steps, removing the offending choice of law and forum selection provisions from their agreement will likely be necessary, or they may choose to include an addendum to their employment agreements with California based employees indicating that such provisions are stricken from the contract.

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The award-winning and AV-rated attorneys at Gehres Law Group, P.C. handle a variety of employment law matters, including drafting employment-related documents and representing parties in employment-related negotiations, mediation, arbitration and litigation. Contact us at (858) 964-2314 or by e-mail at info@gehreslaw.com for a complementary evaluation (for new clients).

© 2017 Gehres Law Group, P.C. We hope you found this article helpful and appreciate any comments or suggestions you may have. It is for general information only and should not be construed to constitute formal legal advice nor the formation of a lawyer/client relationship.

 

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TOP 7 EXCEPTIONS TO THE HEARSAY RULE

Hearsay is defined as an out-of-court statement introduced to prove the truth of its contents. In a prior article, we discussed out-of-court statements which did not constitute hearsay and, therefore, are admissible in evidence.

As an example, an offer made by a seller to sell his car to a prospective buyer for $5000, and the prospective buyer’s statement that he accepted that offer, would not constitute hearsay, because such statements would not be offered into evidence to prove that the seller would in fact sell his car to the buyer or that the buyer would in fact pay $5000 for the seller’s car. Rather, the statements of offer and acceptance may be introduced to simply prove that they were made, because the very words of “offer” and “acceptance” have “independent legal significance,” in that they constituted the execution of a contract between the buyer and seller.

In this article, we discuss seven of the most common exceptions to the hearsay rule. They permit in evidence out-of-court statements, either oral or in writing, which are in fact used to prove the truth of the contents (“hearsay”), but which for various policy reasons, the legislatures and courts have permitted in evidence.

1. Admissions of a Party. A “party” is a plaintiff or a defendant in a matter litigated in court, or a claimant (or petitioner) or a respondent in a non-court proceeding, such as an arbitration or administrative proceeding. The law permits in evidence a statement made by such a party, regardless of the fact it is introduced to prove the truth of its contents. The policy for admitting a statement of a party is that the party is present and can testify about the statement he/she allegedly made, and can deny it was made, or explain what he/she meant by it.

Admissions of a party include what are known as “adoptive admissions.” California Evidence Code §1221 provides:

“Evidence of a statement offered against a party is not made inadmissible by the hearsay rule if the statement is one of which the party, with knowledge of the content thereof, has by words or other conduct manifested his adoption or his belief in its truth.”

An “adoptive admission” is one which the party has not expressed in words, and is typically a statement made by someone else, which the party has, in effect, adopted as his own statement based on his conduct. For instance, if A says to B in reference to C, who is present at that time, “This is my new partner,” and C does not deny it, his failure to deny it is an adoptive admission by him that he is in fact A’s partner.

2. Declarations against Interest. A declaration of a non-party, which is against the interest of the person making the statement, although introduced to prove the truth of its contents, is admissible. The theory behind this exception is that one would not speak falsely or mistakenly when saying something detrimental or prejudicial to himself. A declaration is against one’s interest if it is “so far contrary to the declarant’s pecuniary or proprietary interest, or so far subjects him to the risk of civil and criminal liability, or so far tends to render invalid a claim by him against another, or creates such a risk of making him an object of hatred, ridicule, or social disgrace in the community, that a reasonable man in his position would not have made the statement unless he believed it to be true.”  California Evidence Code §1230.

However, in California state courts, for this exception to apply, the person making the statement must be “unavailable as a witness.”  Id.  If the witness who made the statement can be brought into court, such as by way of a subpoena served on him, the party seeking to introduce the statement must bring the witness into court, so that he may be questioned directly about the statement, and cross-examined by the party opposing statement.

3. Spontaneous Statements, or “Excited Utterances.” Statements made by a person without deliberation or reflection are permitted in evidence, regardless of the fact they are introduced to prove the truth of their content, on the theory that the statements are most likely true and trustworthy under such circumstances. A typical example would be a statement blurted out by the speaker immediately after and in response to a startling incident. For instance, a witness’s statement, “Oh my God, he just went through a red light,” right after a serious auto accident, would qualify for admission under this exception. See California Evidence Code §1240.
4. Dying Declarations. California Evidence Code §1242 permits proof of “a statement made by a dying person respecting the cause and circumstances of his death,” if it was made “upon his personal knowledge and under a sense of immediately impending death.” The policy permitting one who heard such a statement to testify that the statement was made is the fact that, because of the solemnity of the circumstances, one on his deathbed would not be expected to speak falsely.
5. Statements of Physical or Mental State. California Evidence Code §1250 provides that, “A statement of the declarant’s then existing state of mind, emotion, or physical sensation (including a statement of intent, plan, motive, design, mental feeling, pain, or bodily health)” is admissible when the evidence is offered to prove the declarant’s state of mind, emotion or physical sensation at any time when it is itself an issue, or to prove or explain the acts of the person making the statement.

A typical example would be a statement of intent. If, for instance, A told B that he would be traveling from California to Colorado on Monday of the following week, B would be permitted to testify that A told him that. The theory for permitting B to so testify is that it is likely that one will do that which he states he intends to do. In other words, the statement is considered reliable and the purpose for the hearsay rule would not be served by denying its admission in evidence.

6. Business records. Not all out-of-court statements are oral. Some are written. Business records are a prime example. Most businesses keep records of their transactions, and the law permits their admission in evidence, even for the purpose of proving the truth of the contents of the records, so long as the following conditions are met:

(1)  The writing or record must have been made in the regular course of the business;

(2) It must have been made at or near the time of the act, condition, or event it records;

(3)  The custodian or other qualified witness testifies to its identity and the way in which it was prepared; and

(4) The sources of information and the method and time of preparation of the record are such as to indicate its trustworthiness. See California Evidence Code §1271.

7. Official Records and Writings. Official records and writings are admissible if they are statements of a public official, so long as it is shown that the official was under a duty to make the statement, and that the statement was based on facts within the official’s personal knowledge. The policy consideration behind this exception is the fact that public functions could not be conveniently performed if government officials were always required to appear in court and testify to their acts. See California Evidence Code §1280.

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The attorneys at Gehres Law Group, P.C. handle all types of civil litigation matters, and deal with evidentiary matters, such as the hearsay rule and its exceptions, with regularity. Contact the award-winning and AV-rated trial lawyers at Gehres Law Group, P.C. at (858) 964-2314 or by e-mail at info@gehreslaw.com. We are pleased to offer complementary evaluations to new clients.

© 2017 Gehres Law Group, P.C. We hope you found this article helpful and appreciate any comments or suggestions you may have. It is for general information only and should not be construed to constitute formal legal advice nor the formation of a lawyer/client relationship.

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Want to Make a Federal Case of it?

It amuses me when I find myself resorting to one of the many “sayings” or “expressions” I learned early in my childhood, and have always understood, but the derivation of which I did not bother to investigate or learn until much later. Just now, for example, remembering how my mother would say “I don’t want to hear about it… go tell Yehudi!,”, I realize I have no idea who Yehudi might have been. I just googled it, and read that Yehudi was the name of a famous violinist of my parents’ time…and is a common Jewish name, and is sometimes used as an endonym for “jew”. (I’ll let you google “endonym”.)

Some expressions were obvious, like when my father instructed “use your noodle!”, as he often did when he thought we weren’t thinking things through. He meant “think about it”, and “noodle” meant “brain”. And I understood the aphorism, which my parents used to rebuke us for lack of discipline or character, “the road to hell is paved with good intentions.”

But frequently the references were like make-believe. If something was imagined in a far away and exotic place, most likely that would be “Timbuktu”. It failed to occur to me that Timbuktu was a real place that I could find on a map (FYI, it’s in the African nation of Mali). Nor did I have any idea who “Rube Goldberg” was, though he was usually mentioned when my parents complained of some poorly calculated solution or defective device. (I later learned he was a cartoonist who specialized in drawing fictional, complicated mechanical contraptions.)

“DON’T MAKE A FEDERAL CASE OF IT!”

Similarly, when my father thought someone was making too big a deal about some problem or dispute, and needed to “chill”, in today’s parlance,  he would often say, “you don’t need to make a Federal Case out of it!” And just as I rarely considered the literal meaning of my parents’ short-hand expressions, I never thought about what a “Federal case” was, or how it might be something more substantial than an ordinary “case”, i.e. not federal.

But that was before I was even out of grammar school, and long before I became a lawyer and learned that there actually IS such a thing as a “Federal Case”–and it DOES have significant characteristics that distinguish it from other “cases”–like “State cases.”

WHAT IS A FEDERAL CASE?

A Federal case, most literally, is a lawsuit that is filed in a Federal Court, which usually means one of the 94 “District Courts” that Congress has established throughout the United States, one or more in each of the 50 states and the District of Columbia, and a few outside of the United States (in Guam, Puerto Rico, the Mariana Islands). District Courts are courts of “original jurisdiction”, as opposed to the Federal Courts of Appeal, which are courts of
“appellate jurisdiction”. In other words, District Courts are where Federal Cases are first brought for trial in Federal Court.

WHY DID MY DAD THINK A “FEDERAL CASE” WAS SUCH A BIG DEAL?!!

I’m not sure how much my dad knew about the law. He was a smart man, but he had no training in law and never was involved in a lawsuit, as far as I know. I imagine he figured that a “Federal Case” must involve “Federal Law”, which is kind of a big deal since Federal laws apply across the county, and not just in one State–and that’s true. In most situations, Federal laws must be enforced in Federal Court.

But it’s also true that State Courts handle some very “big” and important cases, with no limit on the amount of money damages that might be awarded. This is referred to as “unlimited jurisdiction”, meaning that the amount of money damages that might be awarded is “unlimited.”  However, State Courts DO have limits regarding their jurisdiction over persons and businesses and events outside of their territory, and involving the interpretation and enforcement of Federal Law, which may require that a particular case be brought or removed to Federal Court.

SOME CASES CAN BE FILED IN EITHER STATE OR FEDERAL COURT

The question of whether a particular lawsuit can be filed in only State Court, or only in Federal Court, or either in State or Federal Court, is a bit too complicated to explain here. However, it is a question every lawyer must ask…and answer…him or herself, when devising initial litigation strategy. There are potential significant advantages and disadvantages depending on the particular facts and laws involved.

SOMETIMES IT HELPS TO MAKE A FEDERAL CASE OUT OF IT!

In our law firm’s practice, where our trial lawyers primarily represent small and medium businesses and individuals in commercial, property and professional disputes, most cases must be filed in State Court. That said, however, Federal Court jurisdiction is by no means uncommon even in these sorts of cases. Where it is available, the benefits can be significant. Many Federal Courts, including San Diego’s Federal Courts, typically have greater resources to manage and facilitate prompt resolution of disputes, prominently including their system for “early neutral evaluation” by a Magistrate Judge. The Federal Courthouses and courtrooms are also typically more formal and solemn, and the results of any given dispute can be more predictable in Federal Court. Another advantage of Federal Courts is that the time to trial is often faster than our litigation attorneys see in State Courts.

CONCLUSION

Whenever I interview a new client with a dispute likely to result in litigation, I always remember by father’s phrase when I ask myself: Do I want to make a Federal Case of this?!!!!”

Free Consultations by Experienced Attorneys at Gehres Law Group, P.C.

The experienced business litigation lawyers at Gehres Law Group understand the importance of analyzing the appropriate jurisdiction and venue where a case should be brought at the outset of a case, and advising the client and planning the case accordingly. We encourage you to take advantage of our knowledge and decades of experience successfully representing clients in litigation.

© 2017 Gehres Law Group, P.C. We hope you found this article helpful and appreciate any comments or suggestions you may have. It is for general information only and should not be construed to constitute formal legal advice nor the formation of a lawyer/client relationship.

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THE “DAY OF REST” REQUIREMENT OF LABOR CODE SECTIONS 551 AND 552

Earlier this month, the California Supreme Court issued rulings on three previously-unanswered questions relating to the “Day of Rest” requirement of Labor Code Sections 551 and 552. In Mendoza v. Nordstrom, Inc., decided May 8, 2017, the Court first addressed the meaning of §551 (“[E]very person employed in any occupation of labor is entitled to one day’s rest therefrom in seven”) and §552 (“[N]o employer shall cause his employees to work more than six days in seven.”)

“SEVEN DAYS” MEANS A REGULAR WORK WEEK

Plaintiff Mendoza, an employee of Defendant Nordstrom, asserted that these Code sections required that in any period of seven consecutive days, the employer is required to provide the employee one day of rest. Nordstrom argued that the reference to “seven” in both sections was to a regular work week (e.g., Sunday to Saturday, Monday to Sunday, etc.) — in other words, the regular work week established by the employer.

Based on an analysis of legislative history and other related Labor Code sections, the Supreme Court ruled that the “day of rest” protection provided to employees applied on a week-to-week basis, and not on a “rolling basis” as asserted by employee Mendoza. Thus, an employer could theoretically require an employee to work 12 straight days without providing the employee a day of rest. For example, the employer could require an employee to work Monday through Saturday in week 1, and Sunday through Friday in week 2, without violating Sections 551 and 552. By providing the employee with a rest day in both weeks (Sunday in week 1 and Saturday in Week 2), the employer would be complying with the mandates of these Sections of the Labor Code.

THE “SIX HOURS IN ANY ONE DAY EXEMPTION”

The second question the Court addressed was how the six-hour day exemption in §554 should be applied. Section 554 provides that “Sections 551 and 552 shall not apply to any employer or employee when the total hours of employment do not exceed 30 hours in any week or six hours in any one day thereof.” Does “six hours in any one day” mean that the exemption from the “rest day” requirement means that, so long as any one day in the seven-day work week is six hours or less, the exemption applies? Or, does it mean that the exemption applies only if every day within the seven-day work week is six hours or less. The Court ruled that every day within the week must be a workday of six hours or less for the exemption to apply. The Court further ruled that the 30 hours per week and six hours per day were in the conjunctive — meaning, the “rest day” exemption applies only if the employee works no more than 30 hours in a work week and no more than six hours in any day of the work week.

WHAT DOES IT MEAN TO “CAUSE” AN EMPLOYEE TO WORK A SEVENTH DAY?

The third and final question addressed and answered by the Court was the meaning of the proscription in §552 that an employer not “cause his employees to work more than six days in seven.” [Emphasis added]. Employee Mendoza contended that whenever an employer allows, suffers or permits an employee to work a seventh day, it has “caused” the employee to work. Nordstrom, on the other hand, argued that unless the employer requires, forces or coerces an employee to work a seventh day, it has not “caused” the employee to work on the seventh day.

The Supreme Court concluded that neither the employee nor the employer was correct. Rather, said the Court, “An employer’s obligation is to apprise employees of their entitlement to a day of rest and thereafter to maintain absolute neutrality as to the exercise of that right. An employer may not encourage its employees to forego rest or conceal entitlement to rest, but is not liable simply because an employee chooses to work a seventh day.”

In so ruling, the court noted that “[F]or a century employers have been liable for wages for passively suffering or permitting work (citations omitted), but the Legislature chose not to write the obligation to afford of day arrest so broadly (e.g., “An employer shall not suffer or permit an employee to work more than six days in seven”), and forbade only causing an employee to forego rest.” In conclusion, the court ruled: “An employer cannot affirmatively seek to motivate an employee’s forsaking rest, but neither need it act to prevent such forsaking.”

These interpretations of the Labor Code by our state Supreme Court provide much needed clarification for employers and the lawyers who represent them. For further information on this and other Labor Code issues, contact the award-winning and AV-rated employment law attorneys at Gehres Law Group, P.C. at (858) 964-2314 or by e-mail at info@gehreslaw.com. Our attorneys are pleased to offer complementary evaluations to new clients.

© 2017 Gehres Law Group, P.C. We hope you found this article helpful and appreciate any comments or suggestions you may have. It is for general information only and should not be construed to constitute formal legal advice nor the formation of a lawyer/client relationship.

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