Appellate — continued from Previous Page
included. These were a requirement that the plaintiff was required to prove that any disclosures were made in good faith and for the public good, and not for per- sonal reasons; that debatable differences of opinion concerning policy matters are not protected disclosures; and that infor- mation passed along to a supervisor in the normal course of duties is not a pro- tected disclosure. Each of these restric- tions was either erroneous under both California and federal law; or was appli- cable solely to the federal statute, but not to its California counterpart.
Arbitration; enforceability of
arbitration clauses in employment applications: Wisdom v. Accentcare, Inc. (2012) __ Cal.App.4th __ (3rd Dist.) Plaintiffs were employed by
Accentcare as on-call staffing coordina- tors. They filed a lawsuit claiming they were not paid overtime. The defendant moved to compel arbitration. The trial court denied the petition. Affirmed. The court held that the element of procedural unconscionability was present. The con- tract was one of adhesion, and was given to plaintiffs when they applied for employment. The bargaining power is inherently unequal. The agreement itself implied that there was no opportunity to negotiate its terms. Rather, it required
the applicant to “acknowledge your understanding of the following state- ments and agreements” including that disputes would be arbitrated under the rules of the American Arbitration Association. The failure to attach the rules was also evidence of procedural unconscionability. The element of sur- prise was also present, because the arbi- tration agreement was one of several forms presented to the plaintiffs when applying for employment and was not explained to the applicants. The court also found substantive unconscionability because the agreement to arbitrate was not mutual. The only party called on to agree to arbitration under the agreement was the employee applicant. The court contrasted the form supplied to plaintiffs with post-hire arbi- tration form used by Accentcare, which clearly stated that “both Accentcare and I agree to forego any right we each may have had to a jury trial” and to resolve the dispute through binding arbitration. The court rejected the defendant’s
reliance on Roman v. Superior Court (2009) 172 Cal.App.4th 1462, which held that a virtually identical form was enforceable, created only limited proce- dural unconscionability, and was bilater- al. The court held that Roman had failed to explain its conclusions and was not
persuasive, and that to the extent that it held that a one-sided arbitration agree- ment was not unconscionable, was simply wrong.
Special verdicts; interpretation:
Othopedic Systems, Inc. v. Schlein (2012) __ Cal.App.4th __ (First Dist. Div. 4.) Schlein, an orthopedic surgeon, cre-
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ated a medical device that bore his name. Defendant Othorpedic Systems, Inc. (“OSI”) marketed it for years, and paid him royalties. OSI stopped paying royal- ties, but continued to market a device bearing Schlein’s name. Schlein asserted claims for breach of contract, and com- mercial misappropriation of his name, among other claims. The jury awarded Schlein $616,043 in damages on his con- tract claim, and found on its verdict form that OSI earned $1,220,000 in profits attributable to the use of Schlein’s name – but on the portion of the form titled, “total amount awarded” the jury included only the $616,043 plus the $750 in statu- tory damages. On appeal, Schlein argued that the award should have included the profits that OSI made by using his name. The Court of Appeal agreed, and amend- ed the judgment to include this amount. The court found that, taken as a whole, and in light of the parties’ claims, the special verdict form showed that the jury intended to award the profits earned by OSI. The real issue was not the interpre- tation of the verdict form, but rather the legal issue of whether a plaintiff whose name is misappropriated by another may recover the defendant’s profits. On this issue, the court concluded that California permits such a recovery.
Jeffrey Isaac Ehrlich is the principal of
the Ehrlich Law Firm in Encino. His prac- tice emphasizes insurance bad-faith and appellate litigation. A Harvard Law gradu- ate, he is certified by the State Bar of California as an appellate specialist. He has twice been selected as Appellate Lawyer of the Year by the Consumer Attorneys Association of Los Angeles.
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