Scripta Ad Astra Staff, Author at Ad Astra Law Group, LLP

Ninth Circuit Finds That FedEx Drivers Are Employees and Not Independent Contractors

Author: Scripta Ad Astra Staff

An interesting opinion in Alexander v. FedEx came out of the Ninth Circuit on Wednesday holding that FedEx drivers and delivery people were improperly classified as independent contractors instead of employees because of the level of control that FedEx maintains over those drivers. I find the opinion “interesting” because I never would have thought the people driving in the FedEx branded trucks, FedEx branded uniforms, using FedEx technology, delivering packages to FedEx customers in areas designated by FedEx, on FedEx’s schedule, would have been classified as anything other than an employee.

Federal Judge Rules Against NCAA In Antitrust Lawsuit

Author: Wendy Hillger & Scripta Ad Astra Staff

It has been a little over a week since U.S. District Judge Claudia Wilken of the Northern District of California issued her August 8, 2014 landmark ruling against the National Collegiate Athletic Association (“NCAA”) in O’Bannon v. NCAA. While it is too early to know the ramifications of the ruling (the NCAA has already stated it will appeal), the opinion has roundly been seen as favorable for collegiate athletes.

How The Challenge Started
The road to get to this ruling did not start with the lead plaintiff, former UCLA basketball star, Ed O’Bannon, simply filing suit. Rather, Mr. O’Bannon stood on the accomplishments of an evolution in public opinion and challenges that chipped away at the NCAA’s “defense of amateurism”.

The challenge to NCAA’s reign was, in part, started by the very man who helped commercialize college sports, Sonny Vaccaro. After spending decades building endorsement relationships between shoe companies such as Nike, Adidas, and Reebok, with universities all over the country, Mr. Vaccaro eventually soured on what he saw as colleges taking advantage of athletes. While universities and the NCAA were making money hand-over-fist from merchandising, television rights, and other endorsement deals, they were withholding those revenues from the athletes (called “student-athletes” by the NCAA for the purposes of avoiding paying workers compensation insurance), suggesting that these athletes were playing as students and amateurs, not professionals, and thus not entitled to that money.

S.D.N.Y. Affirms Order To Microsoft To Hand Over Data Stored Overseas Pursuant To A Stored Communications Act Warrant

Author: Scripta Ad Astra Staff

On Thursday, July 31, 2014, Microsoft lost a challenge to an April 25, 2014 order denying its motion to quash a subpoena issued by the federal government pursuant to the Stored Communications Act (“SCA”) for email communications located on Microsoft servers in the Ireland. Issuing her ruling from the bench, U.S. District Judge Loretta Preska stated that “Congress intended in this statute for ISPs to produce information under their control, albeit stored abroad, to law enforcement in the United States … As [Magistrate Judge James Francis IV] found, it is a question of control, not a question of the location of that information.”

Luckily for Microsoft, Judge Preska stayed the implementation of her ruling so that Microsoft could appeal to the Second Circuit. While we wait for that to occur, it might be worthwhile to go back and examine what Judge Francis’ April 25, 2014 Order said.

NSF Funds New UCLA Cybersecurity Research Center and Other News

Author: Scripta Ad Astra Staff

NSF Funds New UCLA Cybersecurity Research Center
In news not necessarily related to the law, UCLA just announced that it is starting a cybersecurity research center, thanks to a grant by the National Science Foundation. The Center for Encrypted Functionalities opened on Thursday, July 31, 2014, and is funded by a five-year, $5 million grant from theNSF’s Secure and Trustworthy Cyberspace program. The center is a collaboration among researchers at UCLA, Stanford University, Columbia University, the University of Texas at Austin and Johns Hopkins University. As a proud alumnus, I am happy to hear that UCLA is taking a leading role in developing cybersecurity solutions.

Congressman Darrell Issa Not Happy With The Federal Trade Commission Taking Action Against LabMD For Data Security Breaches

Author: Scripta Ad Astra Staff

On Thursday, July 24, 2014, Congressman Darrell Issa (R- CA 49), Chairman of the House Oversight Committee, held a hearing on the Federal Trade Commission’s prosecution of LabMD for alleged data security breaches leading to the release of its customer’s personal data. Needless to say, Congressman Issa was not happy with the FTC.

Background of FTC v. LabMD
On August 28, 2013, the FTC filed an administrative complaint against LabMD alleging a variety of data security breaches that lead to the release of consumer information. LabMD conducts clinical laboratory tests on specimen samples from consumers and reporting test results to consumers’ health care providers.
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Will the new proportionality rule in federal discovery help plaintiffs or defendants? O’Connor v. Uber may be the first test.

Author: Michael S. Dorsi

Effective December 1, 2015, new amendments to Federal Rule of Civil Procedure 26 took effect. Notably, Rule 26(b)(1) now requires that discovery be “proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, . . . and whether the burden or expense of the proposed discovery outweighs its likely benefit.”

Initial published responses viewed this rule as pro-defendant.[1] Some suggested that this was a rule designed to address large company versus company disputes not appropriate for other types of cases.[2] Plaintiff-side employment lawyers were particularly concerned because their cases often require defendants to disclose far more in discovery than their clients disclose.

However, it seems that the first high profile test of this new rule came out in favor of employment class action plaintiffs—at least at the magistrate judge level. In O’Connor v. Uber Technologies, Inc. (N.D. Cal. Case No. 13-cv-03826-EMC (DMR)), Uber propounded an interrogatory and five requests for production of documents concerning all communications with over 1,700 of the putative class members.[3]

Invoking the new proportionality requirement in Rule 26(b), Magistrate Judge Donna Ryu held that “ Uber’s wildly overbroad discovery requests fail Rule 26(b)’s proportionality requirements.”[4] Judge Ryu continued, “While Uber may be entitled to conduct discovery that is probative of the Borello factors, it may do so through appropriately targeted means, rather than calling for information about every class member contact with class counsel. Again, Uber fails to meet Rule 26(b)’s proportionality test.”[5]

Concerned employee-side plaintiffs lawyers should of course remain vigilant, but there is a lesson from O’Connor v. Uber concerning discovery. Deep-pocketed defendants will often try to outspend a plaintiff. The new proportionality requirement in Rule 26 can help individuals and less deep-pocketed litigants fight back.

[1] See, e.g., Henry J. Kelston, FRCP Discovery Amendments Prove Highly Controversial, Law360.com, available at www.law360.com/articles/512821/frcp-discovery-amendments-prove-highly-controversial (discussing comments by Prof’s Paul Carrington and Arthur Miller)

[2] See, e.g., id. (“To the extent that excessive discovery costs are a problem, the problem exists in a very small percentage of high-stakes and, often, highly contentious cases.”)

[3] See O’Connor v. Uber Technologies, Inc. (N.D. Cal. Case No. 13-cv-03826-EMC (DMR)) (Dkt. No. 458.),

[4] Id. at p. 6:10–11.

[5] Id. at p. 7:8–11.

A Fact Investigation Conducted by Outside Counsel in response to an Employee’s claim of Harassment and Discrimination is Privileged

Author: Wendy Hillger

The California Court of Appeal recently held that outside counsel’s fact investigation of an employee’s harassment and discrimination claims conducted prior to litigation was protected by the attorney-client privilege and work product doctrine.

It has long been California law that when there is a claim of discrimination, harassment or retaliation, the employer must investigate. This investigation must be thorough, objective and complete. To help assist with these requirements, some companies have hired outside legal counsel. This ruling resolves the issue about whether outside legal counsel’s work and communications were privileged. Companies now should not hesitate to investigate an employee claim with outside counsel.

The Court also ruled that assertion of the “avoidable consequences” defense (the employer took reasonable steps to prevent and correct harassment, but the employee failed to use those measures) in the subsequent lawsuit did not waive the privilege as to a post-employment investigation.

[City of Petaluma v. Superior Court (Andrea Waters), Case No. A145437]

Not Exactly A Midsummer Night’s Dream for Some

Author: David Nied

The Ninth Circuit has handed down two significant decisions under the Computer Fraud and Abuse Act in the past week. In the first decision, United States v. Nosal, the court affirmed the CFAA conviction of David Nosal, a former Korn/Ferry employee who left to start his own competing business with several co-workers. After Nosal and his co-workers left, Korn/Ferry revoked their computer access credentials. Nevertheless, the departed employees used the computer access credentials of Mr. Nosal’s executive assistant—who remained at Korn/Ferry—to obtain access to the company’s proprietary database. The court held that “without authorization” under the CFAA was unambiguous and means “accessing a protected computer without permission.” Nosal argued that since his former executive assistant was authorized to access the company’s computers, he had not violated the statute. Not so, said the court: “once authorization to access a computer has been affirmatively revoked, the user cannot sidestep the statute by going through the back door and accessing the computer through a third party. Unequivocal revocation of computer access closes both the front door and the back door.” Ad Astra’s David Nied and Michael Dorsi, and former associate, Keenan Ng, submitted an amicus brief on behalf of a former client and in support of the United States in which they discussed the importance of the remedies under the CFAA to small, entrepreneurial businesses in the Bay Area. You can read The Recorder’s summary of the decision here. The Recorder quoted Mr. Nied’s observation that the decision “confirms that [small businesses] have a tool available to them under the CFAA to protect their business, their intellectual property, and their trade secrets from former employees.”

In the second decision, Facebook v. Vachani, the court concluded that a social-media aggregator, Power.com, and its principal, Steven Vachani, had violated the CFAA by continuing to use Facebook users’ accounts to send spam email and messages to other Facebook users to promote Power.com after Facebook had sent them a cease and desist notice. Like Mr. Nosal, the defendants argued that they had not violated the CFAA because they had the consent of the Facebook users to send out the emails and messages. The Ninth Circuit, however, concluded that the cease and desist notice revoked any permission the defendants had to use Facebook’s computers and that the defendants used Facebook’s computers “without authorization” after that point in time. The court returned the case to the trial court to re-calculate Facebook’s damages from the date of the cease and desist notice. The takeaway for small business owners is to send out a cease and desist notice the moment you become aware that a third party may be accessing your computers or cloud-based accounts without permission. You can read more about the decision in The Recorder.

What is CCP 170.6, and How do Attorneys Use It?

Author: Brian M. Worthington
The situation involving embattled Santa Clara County Court Judge Aaron Persky took a new turn this week when the Santa Clara District Attorney’s Office used California Code of Civil Procedure Section 170.6 to disqualify Judge Persky from an upcoming case. Some of our readers may be wondering, What is CCP 170.6?; When is it used?; and How do attorneys use it? We are here to answer those questions.

CCP 170.6 allows a party to a case (or the attorney representing that party) a one-time opportunity to disqualify a judge who is prejudiced against a party or the party’s cause. It applies equally to criminal and civil cases and has varying time restrictions depending on the type of calendaring system used in the County in which the case is being heard. A party can use CCP 170.6 to disqualify a judge assigned for all purposes, a judge assigned for a trial, or even a judge assigned for a specific motion.

The disqualification must be done in writing or orally under oath. The legal basis for a 170.6 disqualification (sometimes called “papering” a judge) is the bias against a party or cause. But in practice CCP 170.6 has almost unlimited applications—we have seen situations where a judge is disqualified due to personal conflicts with a particular attorney; where a judge has a blind spot toward a particular legal issue; or where a judge is perceived to have a habit of punishing too harshly or too leniently in particular criminal matters.

The ability to exercise a CCP 170.6 disqualification is a major tactical weapon for an attorney. For instance, if an attorney is handling a case where police misconduct is a major element of the defense, the attorney will want to avoid judges with strong law-enforcement ties or history of disregarding police misconduct. CCP 170.6 allows the attorney to do that. But an attorney must exercise great care in making the decision because the attorney can only choose which judge to disqualify, not the new judge assigned. On some occasions, the newly assigned judge may be just as bad on the particular issue as the original judge, or may even be worse on other issues that can come into play. Even using a disqualification and getting a great new judge is not always a cure-all for the client because if the new assigned judge is too favorable, the opposing party can turn around and disqualify the new judge. This leads to an interesting tête-à-tête between the opposing attorneys.

We hope this brief entry helps explain what CCP 170.6 is and how attorneys use to try help their clients. Thank you for reading.

What to Expect When You are Going Through a Divorce

Author: Regina Franco

Divorce takes time.

Once you decide to file for divorce, the next thing you want to do is quickly move on to the next chapter of your life, but divorce doesn’t happen that quickly. There is a mandatory waiting period required by California law and no judgment of divorce can be entered sooner than 6 months from the date the Petition for Dissolution was served onto the Respondent.

While 6 months may feel like a long time, there is a lot of paperwork that needs to be done and taking the proper time to work through your case will oftentimes prove to be time well spent. Divorce can be complicated. A divorce is essentially creating two new families out of one. This requires careful thought in order to make sound decisions about support, property division, and custody.

Divorce is not easy and over the course of at least 6 months, divorce will consume you. It is important that you choose your attorney wisely as the right relationship will make a positive impact on you as you transition into your new life.