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Early Sullivan Prevails in the Second Appellate District of California
Category: News, Results | Tuesday, April 9th, 2019 | Comments Off on Early Sullivan Prevails in the Second Appellate District of California
Scott Gizer, Diane Luczon, and Zachary Gidding successfully prevailed in Charles Johnson v. Sun West Mortgage Company Inc. et al. The Court of Appeal affirmed the lower court’s ruling on Early Sullivan’s motion for summary judgment in favor of Sun West Mortgage Company, finding that the trial court properly excluded an expert witness declaration in its entirety when granting the motion and finding that Sun West had no liability to Plaintiff. This was a putative class action matter wherein the Plaintiff asserted that Early Sullivan client, Sun West Mortgage Company, had engaged in an illegal kickback scheme with its insurance broker whereby Sun West received below market services in exchange for securing a commission for the broker from the Sun West’s forced placed flood insurer.
The Court of Appeal examined the expert declaration and report, and found that the trial court properly exercised its discretion in granting Sun West’s objection to exclude the witness’s declaration, which had been the basis for arguments that the defendants supposedly had “vastly” overcharged the plaintiff and others for forced placed insurance. In examining the subject declaration, the trial court found it to be “unreliable,” with some parts “simply arbitrary, unverifiable, and unfalsifiable.” The Court of Appeal further affirmed the trial court’s decision that Sun West had not engaged in any improper conduct.
Click “Download PDF” to read the full decision.
Early Sullivan Knocks Out Entire Case on Demurrer
Category: News, Results | Wednesday, April 3rd, 2019 | Comments Off on Early Sullivan Knocks Out Entire Case on Demurrer
In Pak v. First American Title Insurance Company, Los Angeles Superior Court Case No. 18STCV04840, William Wright obtained a judgment of dismissal for the Firm’s client, First American Title Insurance Company. The case concerned claims for breach of title policy and bad faith relating to a commercial property in Los Angeles. The Court sustained First American’s demurrers without leave to amend, agreeing with Mr. Wright that First American had no duty of defense or indemnification in light of the individual plaintiffs’ prior conveyance of the property to their LLC, which conveyance terminated coverage as a matter of law pursuant to Condition 2 of the policy.
Early Sullivan Prevails in 10th Circuit Published Opinion
Category: News, Press, Results | Wednesday, February 27th, 2019 | Comments Off on Early Sullivan Prevails in 10th Circuit Published Opinion
Scott Gizer and Sophia Lau successfully prevailed in Banner Bank v. First American. In the attached published opinion (click “Download PDF”), the 10th Circuit reversed the district court’s ruling on summary judgment with instructions to enter judgment in favor of Early Sullivan client First American finding that one of the nations’s largest title companies had no duty to defend or indemnify its insured, Banner Bank, in an action that alleged that the Bank’s deed of trust was the subject of a fraudulent transfer.
The district court has previously held that First American had a duty to defend and indemnify Banner, breached the implied covenant of good faith and fair dealing, and was responsible for attorneys’ fees by focusing on a single allegation in the complaint against the Bank stating that the Bank’s deed of trust was invalid. This resulted in an award of damages ($675,000) plus attorneys’ fees in an underlying lawsuit ($159,288), and consequential damages of attorneys’ fees in this case ($130,411.50).
The 10th Circuit reversed finding that the district court erred by reading this single allegation in isolation, instead of reading the complaint as a whole as required when determining the duty to defend. When the complaint was read as a whole, the 10th Circuit noted that First American reached the correct legal conclusion that it did not owe a duty to defend or indemnify; it reached this conclusion after complying with its duty to “diligently investigate the facts to enable it to determine whether a claim is valid,” “fairly evaluate the claim,” and “act promptly and reasonably in rejecting or settling the claim.” Prince v. Bear River Mut. Ins. Co., 56 P.3d 524, 533 (Utah 2002).
Bryan Sullivan Settles Lawsuit for Client Terry Crews
Category: News, Press, Results | Friday, September 7th, 2018 | Comments Off on Bryan Sullivan Settles Lawsuit for Client Terry Crews
Several publications, including Vanity Fair and The Hollywood Reporter covered Bryan Sullivan’s representation of actor Terry Crews in his #MeToo case against behemoth agency WME and agent Adam Venit. Bryan filed the civil lawsuit last year against WME and Venit following allegations that he groped Crews at an industry party in 2016. WME admitted that Venit had exhibited a pattern of this type of behavior. As part of the settlement, Venit will be retiring from WME and the agency will institute a new, landmark policy to address workplace conduct of this nature.
Additionally, Bryan authored an exclusive Forbes article about his experience representing Crews in his lawsuit.
Early Sullivan’s Demurrer Victory Upheld on Appeal
Category: News, Results | Tuesday, August 7th, 2018 | Comments Off on Early Sullivan’s Demurrer Victory Upheld on Appeal
The California Court of Appeal has affirmed, in its entirety, the judgment of dismissal that Partner William Wright obtained for the Firm’s client First American Title Insurance Company, in the case entitled Jaisinghani v. U.S. Bank National Association, et al.. The Court of Appeal agreed with Mr. Wright on all five causes of action that were asserted against First American in the various amended complaints filed in Santa Monica Superior Court by Jaisinghani (including causes of action for negligent undertaking, negligent supervision/selection of agent, breach of title insurance policy, breach of agency agreement and unjust enrichment/restitution).
Click here to read the full Court of Appeal ruling.
Early Sullivan Prevails at Trial in Breach of Loan Agreement Case
Category: News, Results | Tuesday, March 6th, 2018 | Comments Off on Early Sullivan Prevails at Trial in Breach of Loan Agreement Case
Scott Gizer, Diane Luczon and Zachary Gidding secured a decision in favor of their client Mazakoda, Inc. for breach of a loan agreement following a bench trial in Los Angeles County Superior Court. Plaintiff Mazakoda, Inc. had alleged that it provided a loan to defendants J&J Oil, Shawn Melamed, Edmond Melamed, Jenous Tootian and Rozita Safaeipour for $500,000, which the defendants failed to pay back. However, the promissory note was lost and only an unsigned copy of the promissory note could be found. Defendants attempted to argue that they never signed the promissory note and that the money they received was not a loan, but a settlement payment to resolve a dispute between the parties. Following a bench trial before the Honorable Daniel Murphy, the Court ruled in favor of Early Sullivan’s client, Mazakoda, finding the preponderance of the evidence supported Mazakoda’s case and that the defendants were not credible witnesses. Mazakoda was awarded its full loan balance of over $900,000 plus attorney’s fees and costs incurred and issued an order permitting Mazakoda to judicially foreclose on the Defendants’ property.
Click “Download PDF” for the court’s decision.
Early Sullivan Obtains Defense Verdict in Favor of Sun West for Alleged RESPA Violations
Category: News, Press, Results | Monday, March 5th, 2018 | Comments Off on Early Sullivan Obtains Defense Verdict in Favor of Sun West for Alleged RESPA Violations
Scott Gizer, along with Diane Luczon, recently achieved an outstanding result on behalf of the firm’s client, defendant Sun West Mortgage Company, Inc., in lawsuit where the plaintiff had alleged that Sun West had violated certain RESPA provisions when it force-placed flood insurance on plaintiff’s behalf. Specifically, the plaintiff had alleged that Sun West failed to follow the requirements of the Florida Insurance Code when procuring the force-placed insurance, which in turn violated Section 2605 of RESPA. Following a Bench Trial in the United States District Court, Southern District of Florida, Judge Robin Rosenberg found in favor of Sun West holding that the plaintiff could not use section 2605 of RESPA to assert of violation of the Florida Insurance Code when the Florida legislature had not provided for a private right action. The decision, which was covered in RESPA News, was of critical importance to lenders because it limits the ability of plaintiffs to use RESPA to assert violations of State statutes that a plaintiff would not be able to sue directly under.
The full article from RESPA News is below.
Florida court rules on extent of RESPA private right of action
In a case involving a reverse mortgage which fell into foreclosure proceedings, a lender purchased forced-placed insurance on the property. After the borrower brought her account current through a Florida government program and the foreclosure complaint was dismissed, she sued the lender and the insurance intermediary for RESPA violations.
The borrower alleged to a Florida district court that the force-placed rates charged were not bona fide and reasonable under RESPA because the procedure for obtaining the rates violated state regulations.
The district judge ruled that RESPA contains only three private rights of action, and the borrower could not “bootstrap” the state regulations through another cause of action.
The case is Michelina Iaffaldano v. Sun West Mortgage Co. and Proctor Financial (U.S. District Court, Southern District of Florida, 17-cv-14222).
Scott Gizer, the lead attorney for Sun West on the case and a partner at Early Sullivan Wright Gizer & McRae LLP, told RESPA News the ruling was significant.
“If plaintiff’s argument was accepted, plaintiffs could use section 2605 of RESPA to assert claims far beyond those three areas,” he said. “The judge’s decision is important because it prevents plaintiffs from using state statutes to create new causes of action where no private right of action was intended.”
In the ruling, District Judge Robin Rosenberg described the three private rights of action in RESPA under established law:
Payment of a kickback and unearned fees for real estate settlement services;
Requiring a buyer to use a title insurer selected by the seller; and
The failure of a loan servicer to provide proper notice about the transfer of loan servicing rights or to respond to a qualified written request for loan information under Section 2605(e).
None of those acts were alleged by Iaffaldano, though, with the court saying the allegations were that Sun West failed to advance insurance premiums on her behalf through an escrow account in violation of 12 C.F.R. § 1024.17 and that the force-placed rates charged were not bona fide and reasonable because the procedure for obtaining those rates violated Florida Insurance Code Section 626.916.
“However, it has been expressly held that 12 C.F.R. § 1024.17, governing escrow accounts, does not create a private right of action for alleged negligence with respect to the administration and maintenance of an escrow account,” Rosenberg wrote, citing Perron v. JP Morgan Chase Bank, N.A, (S.D. Ind. Mar. 10, 2014). “Likewise, it has been held that 12 C.F.R. § 1024.37 does not create a private right of action. Wing Kei Ho v. Bank of Am., N.A., (S.D. Fla. June 21, 2016).”
That logic, Rosenberg wrote, extended to the allegation of bona fide and reasonable charges, because section 626.916 does not create a private right of action – which Iaffaldano did not dispute in the case.
“A plaintiff may not plead around this bar by trying to bootstrap section 626.916 through another cause of action,” Rosenberg wrote, citing Lemy v. Direct Gen. Fin. Co., (M.D. Fla. 2012). “In Lemy v. Direct General Finance Company, the court held that while certain sections of the Florida insurance code provide for a private remedy, section 626.916 is not one of those sections.”
Rosenberg wrote that the court in Lemy explained that “a plaintiff ‘may not evade the Florida legislature’s decision to withhold a statutory cause of action’ for a violation of the insurance code ‘by asserting common law claims based on such violations.’ ”
The Lemy decision focused on common law claims under Florida law, but Rosenberg ruled the reasoning applied would be applicable to a federal cause of action.
“In other words, the court fails to see how a federal RESPA claim could be premised upon an alleged violation of a Florida regulatory statute which contains no private right of action,” Rosenberg wrote.
In fact, the court asked for guidance to case law where it did, and found none.
“The court expressly asked counsel for Iaffaldano to provide case law for the proposition that her RESPA claim could be premised on a Florida statute which lacked a private right of action, and counsel was unable to provide any authority to the court,” Rosenberg wrote. “For these reasons, Iaffaldano has not established that a private right of action exists for any of the RESPA violations she alleges have occurred.”
Iaffaldano also brought an allegation of tortious interference with a business relationship against Proctor, but Rosenberg ruled the claim failed because “the record evidence shows that Proctor did not intentionally or unjustifiably interfere with Iaffaldano’s relationship with Sun West.”
Early Sullivan Successfully Defends Its Client Against $12.5 Million Claim
Category: News, Results | Tuesday, February 20th, 2018 | Comments Off on Early Sullivan Successfully Defends Its Client Against $12.5 Million Claim
Early Sullivan attorneys Mary Kaufman and Zachary Gidding successfully defended, with Scott Gizer, a quiet title action for Defendant CFIC-2014 NV FI-PSC, LLC (“CFIC”) in the Nevada District Court Case entitled LLV Holdco, LLC v. Atalon Management Group LLC, et al, where they prevailed on summary judgment.
CFIC purchased vacant lots of land in 2014 for $12.5 million from other defendants, who the Plaintiffs alleged fraudulently induced the Plaintiffs to waive their right of first refusal to purchase those lots in 2012. Plaintiffs sought to quiet title to the subject property against CFIC.
CFIC defended the claim on the ground it was a bona fide purchaser with no knowledge of the purported fraudulent conduct of one of the other defendants, and further argued that even if CFIC was under a duty of inquiry regarding the waiver that Plaintiffs signed in 2012, CFIC should still prevail because, based on key testimony obtained by Early Sullivan, Plaintiffs’ board members admitted that if CFIC had approached the Plaintiffs about the waiver, the Plaintiffs would have confirmed its validity.
The Court agreed with Early Sullivan’s client CFIC and granted its motion for summary judgment.
Ninth Circuit Rejects En Banc Review Bid in Risinger v. SOC
Category: News, Press, Results | Wednesday, October 18th, 2017 | Comments Off on Ninth Circuit Rejects En Banc Review Bid in Risinger v. SOC
9th Circ. Won’t Rethink Class Cert. For Private Iraq Guards
By Vin Gurrieri
Law360, New York (October 17, 2017, 9:15 PM EDT)
The full Ninth Circuit on Tuesday let stand its decision that thousands of armed guards at U.S. military bases in Iraq can collectively pursue claims that the private security contractor they worked for forced them to work far in excess of the hourly limits imposed by the federal government.
A three judge panel issued a one page order rejecting a bid by SOC LLC and its parent company Day & Zimmermann Inc. for an en banc review of a September decision that upheld a ruling by U.S. District Judge Miranda M. Du to certify a class of armed guards represented by plaintiff Karl Risinger.
Judge Du had held that the guards could collectively pursue claims that SOC uniformly misrepresented the amount of time they were required to work at no more than six days per week and up to 12 hours per day — a ruling the Ninth Circuit affirmed in its September decision.
But in a Sept. 15 petition for en banc review, SOC said the Ninth Circuit essentially used an approach to class certification that existed before the U.S. Supreme Court’s landmark Dukes decision in 2011 that decertified 1.5 million female Walmart employees. The decision was widely perceived as raising the bar for plaintiffs bringing classwide discrimination claims.
Plaintiffs’ counsel Scott E. Gizer of Early Sullivan Wright Gizer & McRae LLP told Law360 Tuesday that “we are pleased the Ninth Circuit correctly and unanimously denied SOC’s petition, moving us one step closer to justice for these brave plaintiffs.”
Representatives for SOC were not immediately available for comment Tuesday.
The dispute stems from a $485 million contract awarded to SOC in 2009 by the U.S. Department of Defense. Under the terms of that deal, SOC had to staff 16 military bases in Iraq and had to limit guards at 72 hours per week, according to court filings by the plaintiffs. Those parameters were communicated to potential employees by SOC recruiters, who used call scripts, and outlined in the workers’ employment contracts, according to court documents.
Risinger, a U.S. Army veteran who worked for SOC in Iraq for a period, alleged in a 2012 lawsuit that the company intentionally understaffed bases and that those manpower shortages meant that guards at the 16 bases in Iraq were forced in practical terms to work seven days a week for more than 14 hours per day, with some going months before having a day off.
The lawsuit, which sought to represent all individuals employed as armed guards by SOC in Iraq from 2006 through 2012, included allegations of promissory fraud, negligent misrepresentation, and breach of contract related to the company’s alleged misrepresentation of guards’ anticipated work schedule before they went to Iraq and breach of its employment contract after they arrived. The class could potentially include in excess of 4,000 people, according to court filings.
In appealing the class certification ruling, SOC had challenged Judge Du’s conclusion that the guards met the predominance prong for certification, which requires that questions of law or fact that are common to class members predominate over any questions that affect only individual class members.
But the Ninth Circuit in its September ruling said that Judge Du had “permissibly found” that SOC recruiters made nearly identical representations concerning guards’ anticipated work schedule in scripts used by recruiters.
Additionally, SOC employees and several recruits described a similar understanding of the work schedule limits, according to the Ninth Circuit ruling.
“Because the district court’s finding renders the misrepresentation element of Risinger’s fraud claims amenable to classwide proof, the district court did not abuse its discretion by concluding that common issues would predominate,” the panel said, adding that the lower court also correctly decided that a common question of contract interpretation predominates for Risinger’s breach of contract claim.
Day & Zimmermann is also named as a defendant.
Circuit Judges Susan P. Graber and Mary H. Murguia as well as U.S. District Judge Edward Davila sat on the panel for the Ninth Circuit.
Risinger is represented by Scott E. Gizer and Devin A. McRae of Early Sullivan Wright Gizer & McRae LLP.
SOC is represented by Theodore J. Boutrous, Theane Evangelis and Bradley J. Hamburger of Gibson Dunn & Crutcher LLP, and Kimberly J. Gost, Matthew J. Hank and Rick D. Roskelley of Littler Mendelson PC.
The case is Karl Risinger v. SOC LLC, case number 1615120 in the U.S. Court of Appeals for the Ninth Circuit.
–Editing by Kelly Duncan.
Scott Gizer and Mary Kaufman Obtain Summary Judgment on Behalf of Sun West
Category: News, Results | Tuesday, August 15th, 2017 | Comments Off on Scott Gizer and Mary Kaufman Obtain Summary Judgment on Behalf of Sun West
Scott Gizer and Mary Kaufman obtained summary judgment on behalf of client Sun West Mortgage Company in Causey v. Sun West Mortgage Company Inc. The MSJ victory came on Willie J. Causey Jr.’s complaint for declaratory relief and violations of the Truth in Lending Act (“TILA”). Sun West denied claims that the company had violated TILA, moving for summary judgment on the grounds that any purported failure to disclose was either not required by law or fell within the safe harbor tolerances of TILA, and that because no TILA violation occurred, Causey’s rescission demands were properly rejected. The Court agreed with Sun West and granted Sun West’s motion in its entirety. The ruling was significant in that the Court clarified that the safe harbor provisions of TILA and Regulation Z apply to both the finance charge and the amount financed, which has been an area of dispute.