Motion-Secondary: JOHNA PECOT et al VS. SAN FRANCISCO DEPUTY SHERIFF'S ASSOCIATION, A et al

• 
• 
• 
• 
• 
• 
• 
• 

						
                                
Preview
                                1

2 | LAW OFFICES OF PAUL L. KRANZ
PAUL L. KRA ESQ., SBN 114999

3 | 499 14" Street, Suite 300 FILED.
Oakland, CA 94612

4] kranzlawi@sbeglobal.net P ceuney oF ean Prenctscolt

3} Telephone: (510) 839-1200 07/17/2015
Facsimile: (510) 444-6698 BY:RONNIE OTERO

6 Deputy Clerk

5 Attomeys for Named Plaintiffs Johna Pecot, ef al.,

oe

9
10
1 SUPERIOR COURT FOR THE STATE OF CALIFORNIA
D COUNTY OF SAN FRANCISCO
13
14] JOHNA PECOT, et al. Individually and on Behalf of ) CASE NO. CGC-10-501168
_ |, All Others Similarly Situated, )
15 ) PLAINTIFFS? MEMORANDUM
Plaintiffs, } OF POINTS AND AUTHORITIES
16 ) IN OPPOSITION TO MOTION
v. ) TOCONTEST GOOD FAITH OF
7 )  ASETTLEMENT
SAN FRANCISCO DEPUTY SHERIFF'S )
18 | ASSOCIATION, a California Nonprofit ) Date: July 30, 2015
Corporation, ef al. ) Time: 9:30am.
19 ) Dept.: 302
Defendants. )
20
21
- INTRODUCTION
ie The determination of whether a settlement is a “good faith” settlement is based on
7 statute. Primary issues for the court’s determination is whether the settlement is so “out of the
ca ballpark” (the language used in a seminal case for determining “good faith") and whether the
25
a settlement would expose the remaining defendants to a judgment far exceeding their share of the
” liability. Where a non-settling defendant challenges the settlement as not being in good faith.
2g that non-scttling defendants has the burden of proof to demonstrate this. Further, the rights ofa

-1-
stor eauniaassee= A AENFOPOP PTS. & AUTHS. IN OPPOSITION TO MOTION TO CONTEST GOOD FAITH OF A SETTLEMENTstatutory indemnitee or of a contractor indemnitee are not diminished by a setthement to which
the statutory indemnitor or the contract indemnitor is a party.

Defendant Wong's motion charges the SFDSA with “abandoning” Wong by settling with
plaintiffs. However, Wong fails to demonstrate how the settlement exposes Wong to a judgment
far in excess of his liability. Indeed, Wong’s motion does not complain that the subject

settlement increases Wong's liability to plaintiffs. Instead, Wong's complaints about “liability”

6
7
8 | pertain instead to the SFDSA’s obligation to pay his attorney’s fees; this has nothing to do with
9

his liability to plaintiffs. Further, SFDSA’s obligation to pay for his attorney is not aflected by

10 |) the settlement between the SFDSA and plaintifis. The SFDSA’s obligation to pay Wong's

tpstHemetDoarlosds)

attorney's fees is based on both statute and express contract. Under the law, Wong’s rights as a

either a statutory indemnitee or a contractor indemnitee are not diminished by plaintifls’

settlement with the SFDSA, the statutory indemnitor and/or the contract indemnitor.

More than half of Wong's motion otherwise complains about what he characterizes as
|| plaintiffs’ “bad faith” in having brought this action in the first place. Not only is this untrue,
moreover, a plaintiff's initiating an action has nothing to do with the determination of a “good
faith settlement”. ‘There is no statutory authority or case law that supports such an argument and
Wong provides no authority for this novel argument. Further, Wong's insistence that he has no
liability would mean that the settlement could nof increase his liability to plaintiffs, because there
|| would be none to be increased.

Wong's argument with respect to plaintiffs’ “bad faith”and his lack of liability focuses
|| primarily on claims that were long ago dismissed and occupies a substantial portion of his
|| Memorandum of Points and Authorities (*-Memorandum.”) (Memorandum, D (1) - (10).)

With respect to the existing clams, Wong has unsuccessfully argued the position he
argues in his Memorandum in at least four different motions, and to three different judicial
officers of this Court: his first SLAPP motion (to the Honorable Loretta M. Giorgi); his motion
for judgment on the pleadings (to the Honorable James McBride); and his second SLAPP

| motion and his demurrer (to the Honorable Emest H. Goldsmith). He also submitted two

>

oMEMO2OF PTS. & ALITHS. IN OPPOSITION TO MOTION TO CONTEST GOOD FAITH OF A SETTLEMENT2 || improper orders that misrepresented that the Court had dismissed claims against Wong when the

Court had not done so. One order was inadvertently signed by the Court, and the Court had to

Nad

4]] vacate the order. After the Court vacated the order and ordered Wong's attomey to submit a

wa

| corrected order, Wong’s attomey submitted another order which still dismissed Wong. The
6 |) Court then struck then struck the language from the order that dismissed Wong. adding by hand
7 to the order language stating that Wong was not dismissed as an individual defendant. Yet,
8 | Wong contends once again that the law precludes his liability as an individual defendant; Wong

fails to discuss or make any reference to any of the Court’s ruling which have explicitly rejected

oO
—

10 | this contention.

LEGAL ARGUMENT

A. Introduction.

Civil Procedure section 877 provides the basic framework for handling settlements in

14 | multiparty litigation. American Motorcycle Ass'n v. Superior Court (1978) 20 Cal. 3d 578, 604
(extending statute to encompass newly created remedy of comparative indemnity). Under this
statute, a release, a dismissal with or without prejudice, or a covenant not to suc given in good

faith before verdict or judgment to one or more of a number of tortfeasors claimed to be liable
for the same tort, or to one or more other co-obligors. has the following effects: (1) it does not
discharge any nonsettling defendant from liability unless its terms so provide (C.C.P. § 877(ay

(2) the value of the settlement is credited against any judgment entered after trial against the

21 |) nonsettling defendants (C.C.P.§ 877), and (3) the settling defendant is no longer subject to

22 || claims for comparative indemnity from the nonsettling defendants C.C.P. § 877(b).

23 These results depend on a judicial determination that the settlement was entered into in
24 || “good faith" (C.C.P. §§ 877, 877.6). Any party to the action is entitled to a hearing on the issue
25 | of the good faith of a settlement entered into by the plaintiff or other claimant and one or more
26 |) defendants (C.C.P. § 877.6). This language limits the scope of the statute to settlements

27 | involving a plaintiff or other claimant.

bo
we

Thus, Plaintiffs may settle with one of several joint tortfcasors or co-obligors on a

3.
ssthorvetucricstesnst HORFEMOADE PTS. & AUTHS. IN OPPOSITION TO MOTION TO CONTEST GOOD FAITH OF A SETTLEMENT28

contract without releasing the others. Provided it is in “good faith,” the settlement discharges
the settling defendant from liability to the other defendants for equitable contribution or
comparative indemnity. C.C.P. § 877(a), (b). The amount paid by the settling defendant reduces
the claim against the others C.C.P. § 877{a)). But there is still a risk of prejudice to them
because an unreasonably [ow settlement (¢.g.. with the most culpable tortfeasor) would expose
the remaining defendants to a judgment exceeding their fair share of the liability. To avoid this
risk. the court is empowered under C.C.P. § 877.6 to determine the “good faith” of such
“piecemeal” settlements. (Bay Develop. Ltd. v. Sup.Ct. (Home Capital Corp.) (1990) 30 Cal. 3d
1012, 1019-1020.) The above statutes provide a “defensive” procedure by which a joint
tortfeasor may extricate itself from a lawsuit and bar actions for equitable indemnity by the

remaining joint tortfeasors. (Heppler v. IM. Peters Co., Inc. (1999) 73 Cal.App. 4th 1265,

1284.)

B. Wong Makes No Showing That His Liability Is Increased By the Settlement.

Wong makes no showing that his liability to plaintiffs would is somehow increased by
the subject settlement. In fact, Wong insists that he has no actual or potential liability
whatsoever. Having advanced that argument, Wong cannot complain that the subject settlement
increases his exposure, when he has so strenuously argued that he has none. What Wong argues

instead is that the settlement somehow increases the amount of attorney's fees required for his

eee

defense. But that is separate and unrelated to any liability to plaintiffs. Wong would still require
an attorney regardless of the settlement agreement since he continues to be a defendant.
notwithstanding the settlement agreement.

| Significantly, Wong's exposure actually may be reduced as a result of the settlement
because the value of the settlement may be credited against any judgment entered after trial

against him as the nonsettling defendant. (C.C.P.§ 877.) Thus, the settlement can be a benefit to

Wong by potentially reducing his exposure, rather than increasing it. Thus, Wong’s argument

| that the settlement increases his liability makes no sense and his motion challenging the

-4-

Yorileeneioancasipeont |/MENFOrOF PTS. & AUTHS. IN OPPOSITION TO MOT#ON TO CONTEST GOOD FAITH OF A SETTLEMENTmoo
eer SS

settlement should be denied.

Ww

Cc. Wong Has Failed to Meet His Burden of Proof.

Ifa party claims that the settlement was not in good faith, that party has the burden of

we

proof on this issue. (C.C_P. § 877.6(d)). Whether the settlement was within the “good faith

6 || ballpark” is to be evaluated on the basis of information available at the time of settlement.

7 | including:
8 A rough approximation of plaintiffs’ total recovery and the settlor's proportionate

9 liability;
10 + The amount paid in settlement;
i + A recognition that a settlor should pay less in settlement than if found liable after a
12 trial:
3 + The allocation of the settlement proceeds among plaintiffs;
l4 + The setilor’s financial condition and insurance policy limits, if any; and

+ Evidence of any collusion, fraud, or tortious conduct between the settlor and the
plaintifls aimed at making the nonsettling parties pay more than their fair share.
(Tech-Bilt, Inc. v. Woodward-Clyde & Associates, supra, 38 C 3d at 499.)
18 ‘Thus, the nonsettling tortfeasor must demonstrate that the settlement is “so far ‘out of the
19 |) ballpark’ in relation to above Tech-Bilt factors as to be inconsistent with the equitable objectives

20 |) of the statute.” (Tech-Bilt, Ine. v. Woodward-Clyde & Associates (1985) 38 C3d 488, 499-500.)

21 Wong engages in no meaningful application or analysis of the Tech-Bilt factors.
22 | Therefore, he has failed to mect his required burden of proof. Having failed to meet his burden
a3

23 | of proof, Wong's motion challenging the settlement agreement should be denied.

24|) Dp. Wong's Indemnification Claims, Being Based on Statute and/or Express Contract
Are Unaffected by a Good Faith Settlement.

An indemnity claim based on statute survives a good-faith settlement by the statutory

bo
Dn
=<

indemnitor. (Kantor v. Housing Auth. (1992) 8 Cal. App. 4th 424. 430-43 I (indemnity claim

under Gov. Code § 825, which provides for public entity's indemnification of employee or

-5-
sgetvorsiboaciosdtces:t Hs AFERTOEOF PTS. & AUTHS. IN OPPOSITION TO MOTION TO CONTEST GOOD FAITH OF A SETTLEMENT| former employee.) Similarly, if there is a contract that expressly provides for indemnity rights
between co-defendants, a good-faith settlement by the contract indemnitor does not defeat a
nonsettling indemnitee’s right to express contractual indemnity. (Bay Dev.. Ltd. v. Superior
Court (1990) 50 Cal. 3d 1012, 1019, 1032; CL. Peek Contractors vy. Superior Court (1984) 159
Cal. App. 3d 828, 834.)

Wong argues that the SFDSA is obligated to pay for his attorney's fees, based on both

Corporation Code section 2802 (Memorandum, 5:9, 6:2) and on an express contract with the

9} SFDSAto pay his attorney's fees U/d.. 5:7). Therefore. Wong's claim for attorney's fees survive

| a good faith settlement.
CONCLUSION
For the foregoing reasons, this motion should be granted.
Dated: July 17, 2015 Respectfully submitted,
LAW OFFICES OF PAUL L. KRANZ

Paul L. Kranz

| -6- :
RIE MOPOF PTS. & AUTHS. IN OPPOSITION TO MOTOON TO CONTEST GOOD FAITH OF A SETTLEMENT