In MSY Trading Inc., et al. v. Saleen Automotive, Inc., the California Court of Appeal recently ruled on a question of first impression: whether a postjudgment, independent action to establish alter ego liability for a judgment on a contract is subject to an award of attorney fees (pursuant to the contract) for a prevailing party, even if the prevailing party had not signed that contract. The Court of Appeal affirmed that any prevailing party, having prevailed in an action based on the contract, could properly seek attorney fees as allowed by the contract. The Court of Appeal also noted that had such alter ego allegations been made in the prior breach of contract action, the prevailing party would most certainly have been entitled to recover its attorney’s fees — therefore, the postjudgment, independent action to establish alter ego liability on that judgment must be considered an action based on the contract.
On April 23, 2020, the United States Supreme Court ruled that a trademark holder need not prove that the infringement of its trademark was willful in order to recover an award of the infringer’s profits. The Court’s decision in Romag Fasteners, Inc. v. Fossil, Inc. resolves a longstanding circuit split and may make it easier for trademark holders in many jurisdictions, including the Ninth Circuit, to recover damages in trademark infringement cases.
On March 23, 2020, the Supreme Court unanimously held in Allen v. Cooper that, absent consent, states cannot be sued for copyright infringement and are shielded from such actions under the doctrine of sovereign immunity. The Court found that the Copyright Remedy Clarification Act of 1990 (CRCA), which expressly provided that states “shall not be immune” under any doctrine of sovereign immunity for copyright infringement, was an unconstitutional abrogation of state sovereign immunity. However, the Court also noted that its decision would “not prevent Congress from passing a valid copyright abrogation law in the future” that is more tailored to pass constitutional muster.
Owners conducting business through a legal entity often do so to limit personal liability and to protect assets unrelated to the business from commercial risks. However, once formed, owners sometimes jeopardize those exposure limiting objectives by filing away their incorporation documents and neglecting corporate formalities. That approach may work fine until, of course, an adverse party argues that the business entity should be disregarded as an ‘alter ego’ of the owners.
In Techno Lite, Inc. v. Emcod, LLC, the California Court of Appeal recently affirmed the finding that an employee can be liable for fraud when said employee violates his promise not to compete with his employer while still employed. Though public policy in California places strict limitations on non-compete agreements after an employee has left employment, this shield was never meant to become a sword by which an employee could undermine his employer with impunity even before his employment ends.
In Magic Carpet Ride LLC, et al. v. Rugger Investment Group, LLC, the California Court of Appeal recently reversed a trial court’s decision to grant summary adjudication on a breach of contract claim where the defendant was eight days late in depositing a required lien release. Even though the contract stated that “time is of the essence” and the late deposit violated the strict terms of the contract, the Court of Appeal clarified that it could be considered substantial performance, creating a triable issue of material fact which made summary adjudication improper.
October marks the opening of the new Supreme Court 2019-2020 term and there is one case in particular that trademark practitioners are anxiously awaiting for the Court to weigh in on to resolve a longstanding circuit split and definitively answer the question whether willful infringement is a prerequisite for an award of an infringer’s profits in an action for trademark infringement.
On March 4, 2019, the United States Supreme Court issued a significant copyright decision that resolved a longstanding circuit split and changes how—and when—copyright owners can file an infringement action in federal court to enforce their copyrights.
A presumption of irreparable harm in trademark cases may be retired, but evidence of likelihood of confusion can still support an inference of irreparable harm.
Many employers outsource some or all of their payroll and related tax duties to third party payroll service providers. These related tax duties may include withholding, reporting, and paying over certain employment (i.e. FICA, Medicare, SDI) and income taxes to the Internal Revenue Service (IRS) and California Employment Development Department (EDD).
Other AALRR Blogs
- Privacy Law Update: New California Privacy Rights Act Further Expands California’s Privacy Law Amid the Evolving Privacy Landscape
- Employment Arbitration Agreements & PAGA — Choose Your Words Carefully
- Ninth Circuit’s Ruling In Frlekin v. Apple, Inc. Is A Cautionary Tale For Employers
- Further Developments Under COVID-19 and Its Continued Impact On Commercial Lease Payment Obligations
- A Postjudgment, Independent Action To Enforce Alter Ego Liability On A Contract Is Considered An Action On The Contract
- Part 5: Data Privacy in California: Responding to Consumer Requests and Enforcement by the Attorney General Begins
- The Appellate Court Takes a Bite Out of Meal and Rest Break Claims
- Los Angeles County Obtains Approval to Move Further into Stage 2; Restaurants May Resume In-Person Dining and Hair Salons and Barbershops May Reopen
- Better Luck Next Time—Supreme Court Unanimously Rejects Defense Preclusion in Lucky Brand Trademark Row
- Leading Ride Share Servicers Sued by the State of California for Continued Misclassification of Drivers as Independent Contractors
- Christopher S. Andre
- Cindy Strom Arellano
- Dan J. Bulfer
- Eduardo A. Carvajal
- Danielle C. Cepeda
- Michele L. Collender
- Scott K. Dauscher
- Evan J. Gautier
- Carol A. Gefis
- Amber S. Healy
- Edward C. Ho
- John E. James
- Jonathan Judge
- David Kang
- Joseph K. Lee
- Lana Milojevic, CIPP/US
- Michael J. Morphew
- Shawn M. Ogle
- Jon M. Setoguchi
- Brian M. Wheeler
- Lisa C. Zaradich