Minding Your Business

Proskauer’s perspective on developments and trends in commercial litigation.

Recent Decisions Clarify (Un)Enforceability of Class Action Waivers in Employment Agreements

Companies looking to waive class action rights of employees may instead be waving goodbye to provisions in their employment contracts. Two recent decisions in California—one administrative and one in the 9th Circuit—recently found that class action waivers in employment contracts were unenforceable as a matter of law and public policy, resulting in the removal of entire or partial contractual provisions. A similar issue will soon be heard by the Supreme Court. Continue Reading

Too Late To Ask the Court to Retain Jurisdiction to Enforce a Settlement Agreement?

Imagine this scenario: after years of litigation in federal court, your client reaches a settlement agreement with the opposing party. The lawsuit is dismissed pursuant to the settlement agreement and Federal Rule of Civil Procedure 41(a)(1). When the opposing party breaches the settlement agreement, you promptly file a motion to compel enforcement – only to have your motion denied for lack of jurisdiction. Continue Reading

Sealing the Case: Controversy Surrounds New York Commercial Division Proposed New Rule

In late 2016, the Commercial Division Advisory Council proffered a proposed rule, Proposed Rule 11-h, which would amend Rule 216.1(a) of the Uniform Rules for Trial Courts in New York to define the “good cause” under which court records could be sealed. “Good cause” to seal court records, as defined by the proposed rule, “may include the protection of proprietary or commercially sensitive information, including without limitation, (i) trade secrets, (ii) current or future business strategies, or (iii) other information that, if disclosed, is likely to cause economic injury or would otherwise be detrimental to the business of a party or third-party.” The Advisory Council has explained that the revised rule is designed to “clarify and highlight” that “the protection of proprietary sensitive business information in commercial disputes is an appropriate goal of, and ‘good cause’ for, sealing of selected documents or portions of documents filed in the course of litigation.” This is in keeping with a principal goal of the Advisory Council: to further enhance the reputation of the Commercial Division as a business friendly court. Continue Reading

California High Court Questions Privileged Nature of Attorney Invoices

In Disney’s The Lion King, the wise lion Mufasa sits atop a rock crag with his heir, the cub Simba, looking down on the Serengeti below. “Everything the light touches,” Mufasa instructs, “is our kingdom.” A similar scene plays out in countless law firms each year, when newly admitted attorneys are trained on the boundaries of the attorney-client privilege, a realm of communication protected from disclosure to outsiders. The California Supreme Court recently cast a shadow over this privilege, however, calling into question the extent to which it applies to one of the most common forms of attorney-client communication: an attorney’s bill. Continue Reading

3-Day-Rule Eliminated for E-Service and Other E-Filing Rules Amendments

The New Year brought with it many new rule changes for federal and California courts, including in the area of electronic service and filing. A few key rules regarding requirements for electronic paperwork and service are summarized below. Continue Reading

NY Court of Appeals Clarifies What May Constitute a Binding Agreement in the Sale of Syndicated Loans

A unanimous New York Court of Appeals recently held that the acceptance of an auction bid for the sale of a syndicated loan may constitute a final and binding trade, even if there is language indicating that the agreement is “subject to” the execution of a mutually acceptable, written agreement. The ruling overturns a New York Appellate Court decision that would have permitted parties to change their minds after agreeing to trades during a competitive online auction. The holding of New York’s highest court establishes that oral and electronic agreements in the debt and equity market can be sufficient under certain circumstances to form final and binding agreements. Continue Reading

Case Halted: California Court Denies Class Certification in Ford Defective Steering Case

On December 22, 2016, a federal District Court Judge in the Northern District of California denied certification of three proposed classes of statewide consumers who purchased or leased certain Ford Fusion or Ford Focus vehicles. The plaintiffs allege that their vehicles contain defective Electronic Power Assisted Steering (“EPAS”) systems prone to sudden and premature failure during normal driving situations. The plaintiffs claim that Ford knew as early as 2007 that the EPAS system was defective, and Ford fraudulently concealed this defect. The plaintiffs also contend they paid more for their cars than they would have if Ford had disclosed the defect. The plaintiffs brought causes of action for (1) common law fraudulent concealment; (2) violation of California’s Consumer Legal Remedies Act (“CLRA”); (3) implied warranty under California’s Song-Beverly Act; and (4) implied warranty under the federal Magnuson-Moss Act. Continue Reading

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