All posts tagged litigation

Not All Conflicts of Interest Can Be Waived!

At the James T. King Bankruptcy Inn of Court, we discussed whether certain fact patterns resulted in actual conflicts. The issues became “as clear as mud” when an attorney cited California Rules of Professional Conduct Rule 3-310.

Rule 3-310 states, in pertinent part:

(C) A member shall not, without the informed written consent of each client:

(2) Accept or continue representation of more than one client in a matter in which the interests of the clients actually conflict; or

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Most Commercial Speech is Not Activity Protected by California’s Anti-SLAPP Statute.

On August 20, 2015, the Los Angeles Division District Court was presented with the issue of whether false advertising on the internet was subject to anti-SLAPP protection. The case is In L.A. Taxi Cooperative, Inc. v. The Independent Taxi Owners Association of Los Angeles and a copy can be found here.

Apparently rival cab companies are purchasing pay per click advertisements on leading search engines which purport to be the rival company but really redirect customers to their own websites and numbers. An example is:

Kia Tehrany, director of operations for Yellow Cab, stated that he conducted a search using the terms “‘Yellow Cab Los Angeles.’” The results included the following:

Yellow Cab Los Angeles – Call 800-521-8294 or Book Online!
www.lataxi.com
Our Cabs get you there Fast & Safe.

Tehrany stated that neither the listed telephone number nor the website was owned or controlled by Yellow Cab. Instead, the website contained information related solely to taxi services provided by ITOA.

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Pop Quiz! How Long After Entry Of Order Confirming A Plan Can The Order Be Revoked? Hint: It’s Not What You Thought!

If an order confirming a Plan of Reorganization is procured by fraud, how many days from entry of order does one have to ask the court to revoke the order?

The answer depends on which chapter of the Bankruptcy Code we’re talking about! In a Chapter 12 or Chapter 13 case, one would have up to the 180th day after the date the order was entered to seek revocation of the discharge. In a Chapter 11 case, one would have up to the 179th day after the date the order was entered to seek revocation. That is a pretty tough lesson to learn the hard way.

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A Surprising Twist on the Parol Evidence Rule!

The following is borrowed from Judge Carroll’s recent August 27, 2015 unpublished opinion on a claims objection which can be found here.

In law school, we learned that if a written instrument is valid, complete and unambiguous, extrinsic evidence is not admissible to vary, add to, or contradict the terms of the instrument. This is called the parol evidence rule. The exception to this rule is if there is an allegation of fraud, accident or mistake.

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How Does the Sham Guarantor Defense Work?

Under California law, a lender may not pursue a deficiency judgment against a borrower where the sale of property securing a debt produces proceeds insufficient to cover the amount of the debt. Lenders may pursue deficiency judgments against guarantors, but only true guarantors. Where the borrower and the guarantor are the same, however, the guaranty is considered an unenforceable sham.

The first set of antideficiency laws were enacted during the Great Depression. They prohibited lenders from obtaining personal judgments against borrowers where the lender’s sale of real property security produces proceeds insufficient to cover the amount of the debt. These laws were expanded beginning on January 1, 2013 in response to the bursting of the housing market bubble.

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