One for the plaintiff's class action bar.... Ron Matorana was a class member in a wage and hour class action against Allstate. Under a settlement, he was entitled to $65,000. But he didn't file a claim form. The settlement papers were approved by the court as fair and reasonable. Matorana, though, received nothing. He claimed he was ill during the notice period and was inattentive to the deadlines in the notice of the settlement he received.
So, he sued class counsel for malpractice, as well as Allstate, for failing to remind him adequately to file a claim form. The trial court said no. Court of Appeal? No sale.
Allstate owed Matorana no duty to follow up at all, so he had no basis for suing Allstate. The malpractice claim against his lawyers was without merit too.
Matorana argued that the notice procedure was inadequate, because it did not contain a provision requiring counsel to check up on class members who did not file claims. That argument was barred because the class procedures were deemed fair and reasonable by the trial court in the class action lawsuit. As such, a challenge to that finding was barred by the doctrine of collateral estoppel.
He also claimed that class counsel had a duty to follow up when he did not submit the form, although not required under the settlement agreement. (Collective "gulp" from the plaintiff's bar).
Not to worry. The court of appeal disagreed. Although class counsel owed Matorana a duty of care, that duty did not include contacting all class members who did not file claim forms. As the court pointed out, if class counsel were required to deal with every class member individually, that would undermine the purpose of a mass-mailed settlement notice approved by the court as fair and consistent with due process. On the other hand, if counsel misrepresented the dates or interfered with filing a claim that conceivably could have given rise to some liability.
The case is Matorana v. Marlin & Saltzman and the opinion is here.
California Supreme Court Rejects Sexual Harassment and Intentional Infliction Claims
The California Supreme Court decided a non-employment case that will have employment law ripple effects.
Suzan Hughes was the divorced widow of Mark Hughes, founder of Herbalife. Mark left a trust of $350 million to his son Alex. Suzan was Alex's guardian. One of the trustees was Christopher Pair, then CEO of Herbalife. The trustees and Suzan had a tumultuous relationship and much litigation. At one point, Pair apparently indicated interest in having a sexual relationship with Hughes. He made some offensive and crude remarks to her regarding his desires. He may have suggested that if she slept with him, he would approve an expenditure of $80,000 for a month's rental on a beach house in Malibu, for Alex (natch).
So, Hughes sued Pair under Civil Code section 51.9, which prohibits sexual harassment outside the employment context by certain vendors / suppliers in various professional business relationships, such as doctors, lawyers, accountants, and trustees.
The lower courts and the Supreme Court agreed that the lewd and crude conduct was not sufficient to constitute "sexual harassment" To get there, the Supreme Court expressly held that harassment under 51.9 is analyzed exactly the same as under the Fair Employment and Housing Act (and Title VII). So, this case is relevant to employment. Of note, because harassment must be "pervasive" or "severe," it will be tough to prove a violation of section 51.9 based on occasional interactions with a covered business' employees. (Normally, one will interact in the workplace more frequently than with a third party.)
The Court also held that Hughes' claim for intentional infliction of emotional distress was barred because the alleged conduct was not sufficient extreme and outrageous, and because Hughes and not proved she suffered "severe" emotional distress.
The opinion is Hughes v. Pair and the opinion is here.
Suzan Hughes was the divorced widow of Mark Hughes, founder of Herbalife. Mark left a trust of $350 million to his son Alex. Suzan was Alex's guardian. One of the trustees was Christopher Pair, then CEO of Herbalife. The trustees and Suzan had a tumultuous relationship and much litigation. At one point, Pair apparently indicated interest in having a sexual relationship with Hughes. He made some offensive and crude remarks to her regarding his desires. He may have suggested that if she slept with him, he would approve an expenditure of $80,000 for a month's rental on a beach house in Malibu, for Alex (natch).
So, Hughes sued Pair under Civil Code section 51.9, which prohibits sexual harassment outside the employment context by certain vendors / suppliers in various professional business relationships, such as doctors, lawyers, accountants, and trustees.
The lower courts and the Supreme Court agreed that the lewd and crude conduct was not sufficient to constitute "sexual harassment" To get there, the Supreme Court expressly held that harassment under 51.9 is analyzed exactly the same as under the Fair Employment and Housing Act (and Title VII). So, this case is relevant to employment. Of note, because harassment must be "pervasive" or "severe," it will be tough to prove a violation of section 51.9 based on occasional interactions with a covered business' employees. (Normally, one will interact in the workplace more frequently than with a third party.)
The Court also held that Hughes' claim for intentional infliction of emotional distress was barred because the alleged conduct was not sufficient extreme and outrageous, and because Hughes and not proved she suffered "severe" emotional distress.
The opinion is Hughes v. Pair and the opinion is here.
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