Loskot v. The Dog House et al

Filing 31

ORDER by Magistrate Judge Jacqueline Scott Corley granting 24 Motion for Settlement (ahm, COURT STAFF) (Filed on 1/23/2013)

Download PDF
1 2 3 4 5 6 7 IN THE UNITED STATES DISTRICT COURT 8 FOR THE NORTHERN DISTRICT OF CALIFORNIA 9 10 Northern District of California United States District Court 11 12 13 MARSHALL LOSKOT, Plaintiff, 14 15 v. 16 17 18 Case No.: C-11-04867 JSC ORDER GRANTING DEFENDANT FRANCES GIRAUDO’S APPLICATION FOR DETERMINATION OF GOOD FAITH SETTLEMENT THE DOG HOUSE, et al., Defendants. 19 20 In this disability access case, Plaintiff brings claims against Defendant Frances Giraudo, the 21 landlord of the subject property, and Giraudo’s tenants, Defendants London Fish ‘n Chips, En-Sheng 22 Mao, and Glen H. Mao. (Dkt. No. 1.) Specifically, Plaintiff’s Complaint alleges the following four 23 causes of action against each Defendant: 1) denial of access by public accommodation in violation of 24 the Americans with Disabilities Act; 2) denial of full and equal access in violation of California Civil 25 Code §§ 54, 54.1, 54.3; 3) denial of accessible sanitary facilities in violation of California Health & 26 Safety Code § 19955, et seq.; 4) denial of access to full and equal accommodations in violation of 27 California Civil Code § 51, et seq. (Id.) Now pending before the Court is Giraudo’s Notice of 28 Settlement and Application for Good Faith Settlement (“Application”) pursuant to California Code 1 of Civil Procedure Section 877. (Dkt. No. 21.) No party has objected to the Application. After 2 carefully considering the filings in this case, the Court GRANTS the Application. The Court further 3 VACATES the hearing on Application scheduled for January 24, 2013. 4 LEGAL STANDARD 5 California Code of Civil Procedure Section 877.6 permits a court to approve a settlement if it 6 determines that the settlement was made in good faith. See Cal. Code Civ. P. § 877.6; Fed. Sav. & 7 Loan Ins. Corp. v. Butler, 904 F.2d 505, 511 (9th Cir. 1990) (holding that while the “section 877.6 8 procedures do not govern a federal action . . . the substantive provisions . . . are applicable”). A 9 finding of good faith settlement between a plaintiff and “one or more of a number of tortfeasors Northern District of California claimed to be liable for the same tort, or to one or more other co-obligors mutually subject to 11 United States District Court 10 contribution rights,” releases the settling defendant “from all liability for any contribution to any 12 other parties.” Cal. Civ. Code § 877(b). While the settlement does not discharge any other party 13 from liability, unless its terms so provide, “it shall reduce the claims against the others in the amount 14 stipulated by the release, the dismissal or the covenant, or in the amount of the consideration paid for 15 it, whichever is the greater.” Id. at § 877(a). Section 877.6(a)(1) further provides that a 16 determination of good faith settlement within the meaning of the statute applies only to “any party to 17 an action in which it is alleged that two or more parties are joint tortfeasors or co-obligors on a 18 contract debt.” See Forman v. Government Employees Ins. Co., 920 F. Supp. 1065, 1066 (N.D. Cal. 19 1996). 20 Section 877.6 reflects “two major goals”: “the equitable sharing of costs among the parties at 21 fault and the encouragement of settlements.” Abbott Ford, Inc. v. Superior Court, 43 Cal. 3d 858, 872 22 (1987). A good faith examination enables the court “to inquire, among other things, whether the 23 amount of the settlement is within the reasonable range of the settling tortfeasor’s proportional share 24 of comparative liability for the plaintiff’s injuries.” Tech–Bilt, Inc. v. Woodward–Clyde & Assoc., 38 25 Cal. 3d 488, 499 (1985). When making a determination that a settlement was made in good faith 26 under section 877.6(a)(1), “the intent and policies underlying section 877.6 require that a number of 27 factors be taken into account:” (1) a rough approximation of the plaintiff’s total recovery and the 28 settlor’s proportional liability; (2) the amount paid in settlement; (3) the allocation of settlement 2 1 proceeds among plaintiffs; (4) the recognition that a settlor should pay less in settlement than he 2 would if he were found liable after trial; (5) the financial conditions and insurance policy limits of the 3 settling tortfeasor; and (6) the existence of collusion, fraud or tortious conduct intended to injure the 4 interests of the non-settling parties. See id. “Practical considerations” require that the evaluation “be 5 made on the basis of the information available at the time of settlement[,] and a defendant’s settlement 6 figure must not be grossly disproportionate to what a reasonable person, at the time of the settlement, 7 would estimate the settling defendant’s liability to be.” Id. (internal citation omitted). 8 9 DISCUSSION As an initial matter, the Court finds that Section 877 applies to this action because Plaintiff’s Northern District of California Complaint alleges that Defendants are “jointly and severally” liable for the access violations. (Dkt. 11 United States District Court 10 No. 1 ¶ 9.) Landlords and tenants are jointly and severally liable for ADA violations where both the 12 landlord and the tenant are persons who “own[], lease[] (or lease[] to), or operate[] a place of public 13 accommodation.” See 42 U.S.C. § 12181(a); see also Botosan v. McNally Realty, 216 F.3d 827, 14 832-33 (9th Cir. 2000) (finding that while a landlord and a tenant can allocate responsibility for 15 ADA compliance in their lease, a lease cannot operate to eliminate a landlord’s liability because 16 allocation is effective only “as between the parties” and “has no effect on the rights of third 17 parties”); but see Kohler v. Bed Bath & Beyond of Cal., LLC, 2012 WL 3018320 *3 (C.D. Cal. July 18 23, 2012) (distinguishing Botosan, and finding in favor of tenant on summary judgment, because the 19 plaintiff did not show that tenant owned, leased, or operated the parking lot, which remained the 20 landlord’s responsibility). 21 Here, Plaintiff alleges that tenant-Defendants are liable for all architectural barriers, 22 including those present in the parking lot. (See Dkt. No. 1 ¶¶ 32, 33.) Although the tenant- 23 Defendants may not ultimately be responsible for the access barriers in the shared parking lot, for 24 purposes of Section 877, it is enough that Plaintiff has alleged they are so responsible. See Cal. Civ. 25 Code § 877.6(a)(1) (providing that “any party to an action in which it is alleged that two or more 26 parties are joint tortfeasors”) (emphasis added). Moreover, Plaintiff’s allegation that Defendants are 27 jointly and severally liable for all of the access violations satisfies the “joint tortfeasor” requirement, 28 which is construed broadly. See Topa Ins. Co. v. Fireman’s Fund Ins. Cos., 39 Cal. App. 4th 1331, 3 1 1341 (1995) (“In many cases courts have construed the term joint tortfeasor, as used in Code of Civil 2 Procedure sections 877 and 877.6, quite broadly to apply not only to those who act in concert in 3 causing an injury but generally to joint, concurrent and successive tortfeasors, and even more 4 generally to all tortfeasors joined in a single action whose acts or omissions concurred to produce the 5 sum total of the injuries to the plaintiff.”) (internal quotation marks and citations omitted); see also 6 Bob Parrett Const., Inc. v. Superior Court, 140 Cal. App. 4th 1180, 1188 n.5 (2006) (applying 7 Section 877 to federal False Claims Act and Anti-Kickback Act claims where both statutes “may 8 give rise to joint and several liability”). 9 Turning to the terms of the settlement and the application of the Tech-Bilt factors, the Court Northern District of California finds that those factors favor approval of the settlement agreement. The terms of the settlement 11 United States District Court 10 agreement are: a mutual release and waiver under California Civil Code Section 1542, dismissal of 12 Plaintiff’s Complaint as to Giraudo with prejudice, payment of $25,000 from Giraudo to Plaintiff, 13 and assignment to Plaintiff of any all rights Giraudo “may have in contract or equity against the 14 other defendants and tenants related to this litigation.” (Dkt. No. 24, Declaration of Brendan J. 15 Dooley in Support of Application, ¶ 4.) 1 16 Giraudo’s payment of $25,000 is consistent with a rough approximation of Plaintiff’s total 17 recovery and Giraudo’s proportional liability. The Application states that Plaintiff made a “global 18 demand” of $52,100, of which $20,050 could generously be allocated to Giraudo. 2 (Id. ¶ 14.) 19 Giraudo contends that this is a fair approximation of her proportional liability because the lease 20 between she and her tenants place liability for maintaining accessibility on the premises with the 21 tenant. Although the Court makes no definitive reading of the lease, it can be read to require the 22 tenants to indemnify Giraudo for liability she incurs as a result of the tenants’ accessibility violations 23 on the premises. (See Dkt. No. 24, Ex. A, Lease Agreement between Giraudo and Barry Van Otten, 24 § 5.5); see also Bay Development, Ltd. v. Superior Court, 50 Cal. 3d 1012, 1034 (1990) (“In 25 Because the parties have not provided the Court with a copy of the settlement agreement, the Court’s examination of the settlement, and its conclusion that the settlement is made in good faith, is accordingly limited to those terms provided in the Dooley Declaration. 2 The Application also states that Plaintiff demanded from Giraudo $10,800, which was based on “her individual responsibility for the repair of common area items (signage and parking).” (Id. ¶ 8.) 1 26 27 28 4 1 evaluating the settling defendant’s potential proportionate liability for purposes of this determination 2 of good faith, the trial court must take into account any contractual relationship between the settling 3 and nonsettling defendants, and must consider how each party’s performance of its contractual 4 obligations relates to its share of liability.”). At the same time, Giraudo appears individually 5 responsible for maintenance of, among other things, the parking lot, and ensuring that it complies 6 with “all municipal requirements.” (Id. § 9.) Although the tenant is provided “with the non- 7 exclusive right to use the parking lot for Lessee’s customer parking,” the parking lot does not appear 8 to constitute part of the “premises.” (Id. § 1.) Therefore, by restricting Giraudo’s liability to just the 9 parking lot, her payment of $25,000 to Plaintiff is not “grossly disproportionate” to what a Northern District of California reasonable person would estimate her proportional liability to be. Indeed, even if Guraudo is 100% 11 United States District Court 10 responsible for Plaintiff’s injury, the payment of almost half of Plaintiff’s total settlement demand 12 would not be “grossly disproportionate.” This Tech-Bilt factor is accordingly satisfied. 13 The Court further finds that none of the other Tech-Bilt factors weigh against finding a good 14 faith settlement. There is no evidence of collusion, fraud or tortious conduct between Plaintiff and 15 Giraudo. 16 CONCLUSION 17 For the reasons stated, the Court GRANTS the unopposed Application for Good Faith 18 Settlement. 19 20 IT IS SO ORDERED. 21 22 Dated: January 23, 2013 _________________________________ JACQUELINE SCOTT CORLEY UNITED STATES MAGISTRATE JUDGE 23 24 25 26 27 28 5

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?