Preview
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‘SAN MATEO COUNTY
1D
DEC 27 2018
e Supefjbr Court
Clerk
By ( DRA
i
SUPERIOR COURT OF THE STATE OF CALIFORNIA
COUNTY OF SAN MATEO
FRANCESCA FAMBROUGH, et al. Civil No. 17CIV05387
CLASS ACTION
Plaintiffs,
Assigned for All Purposes to
VS. Hon. Marie S. Weiner, Dept. 2
REDWOOD CITY, CASE MANAGEMENT ORDER #9
Defendant.
On October 17, 2018, hearing was held on Plaintiffs’ Motion for Class
Certification in Department 2 of this Court before the Honorable Marie S. Weiner. Karen
Frostrom of Thorsnes Bartolotta McGuire LLP appeared on behalf of Plaintiffs; and
Kevin Siegel of Burke Williams & Sorenson LLP appeared on behalf of Defendant.
Upon due consideration of the briefs and evidence presented, and the oral
argument of counsel, and the Court having g taken the matter under submission,
IT IS HEREBY ORDERED as follows
Plaintiffs’ Motion for Class Certification is DENIED
Plaintiff's requests for judicial notice are GRANTED. \3 {7.05387
| tae Management Order
1 ifttnmnay
Leave is GRANTED for any putative class members to file a motion to intervene
to be added as a named Plaintiff to pursue an individual claim for CRAL or inverse
condemnation.
THE COURT FINDS as follows:
Standards for Class Certification
California courts have readily aocepted and utilized the class action procedure to
resolve multiparty controversies. See Richmond v. Dart Industries, Inc. (1981) 29 Cal.3d
462, 469. Under Code of Civil Procedure Section 382, the California class action statute,
there are two basic prerequisites to certification: (1) the existence of an ascertainable
class, and (2) a well-defined community of interest in the questions of law and fact
involved affecting the parties to be represented. Occidental Land, Inc. v. Superior Court
(1976) 18 Cal.3d 355, 360; Daar v. Yellow Cab Company (1967) 67 Cal.2d 695, 704.
Because Section 382 does not establish a procedural framework for class actions,
the California Supreme Court has directed trial courts to utilize the procedures prescribed
by the Consumers Legal Remedies Act (Civil Code §§1750, et seq.) in all class actions.
Civil Service Employees Insurance Company v. Superior Court (1978) 22 Cal.3d 362,
376; Vasquez v. Superior Court (1971) 4 Cal.3d 800, 820. California trial courts have
also been directed to look to Rule 23 of the Federal Rules of Civil Procedure and the ,
cases thereunder for guidance. Id., at p. 821, La Sala v. American S&L Assn. (1971) 5
Cal.3d 864, 872; Howard Gunty Profit Sharing Plan v. Superior Court (2001) 88
Cal.App.4th 572, 580 fn. 8.
Civil Code Section 1781(b) provides:
The court shall permit the suit to be maintained on behalf of all members
of the representative class if all of the following conditions exist:
(1) It is impracticable to bring all members of the class before the court.
(2) The questions of law or fact common to the class are substantially
similar and predominate over the questions affecting the individual
members.
(3) The claims or defenses of the representative plaintiffs are typical of
the claims or defenses of the class.
(4) The representative plaintiff will fairly and adequately protect the
interests of the class.
The merits of plaintiffs' class claims are generally irrelevant for purposes of class
certification. See, Green v. Obledo (1981) 29 Cal.3d 126, 146; Anthony v. General
Motors Corp. (1973) 33 Cal.App.3d 699, 707. “The certification question is ‘essentially
a procedural one that does not ask whether an action is legally or factually meritorious.’
[Citation.]” Sav-On Drug Stores, Inc. v. Superior Court (2004) 34 Cal.4th 319, 326.
In addressing the element of whether it is “impracticable” to bring all members of
the class before the court, the Court should be presented with evidence of the
approximately size of the class. The number of putative class members should be
sufficiently “numerous” to merit use of the class procedure. Numerosity for class
certification might be as low as 30, or be in the hundreds or thousands of people.
Typically, the numerosity requirement is not contested by the defendant.
It is clear under California law that the "ascertainable class" requirement does not
require plaintiff to establish the existence and identity of the individual class members.
Daar, 67 Cal.2d at p. 706; Reyes v. Board of Supervisors (1987) 196 Cal.App.3d 1263,
1274; Stephens v. Montgomery Ward (1987) 193 Cal.App.3d 411, 419. "Whether a class
is ascertainable is determined by examining (1) the class definition, (2) the size of the
class, and (3) the means available for identifying class members." Reyes, at p. 1271.
The second requirement of Civil Code Section 1781(b) is that: "[t]he questions of
law or fact common to the class [be] substantially similar and predominate over questions
affecting the individual members." Section 1781(b) codified the common law
requirement that plaintiff show a well-defined "community of interest" in the questions of
law and fact involved. E.g., Hogya v. Superior Court (1977) 75 Cal.App.3d 122, 136.
For purposes of satisfying
the "community of interest" prerequisite under C.C.P.
Section 382, the plaintiff need only demonstrate that "there are predominate questions of
law or fact common to the class as a whole." Reyes v. Board of Supervisors (1987) 196
Cal.App.3d 1263, 1277. The existence of any individual issues does not preclude class
certification. "[T]he necessity for class members to individually establish eligibility and
damages does not mean individual fact questions predominate." Id., at p. 1278.
Although common issues must predominate for certification of a class, it is not required
that all of the issues be common.
The Court must also contemplate affirmative defenses on class certification. "In
determining whether common issues 'predominate,' courts consider both plaintiff's legal
theories and defendant's affirmative defenses." Weil & Brown, Cal. Prac. Guide: Civ.
Proc. Before Trial (Rutter, Jun. 2017 Update) { 14:15. "Defendant's affirmative defenses
must also be considered because certification may be denied where individual issues
presented by the affirmative defenses predominate over common issues." Id. at J 14:99;
see also, Walsh v. IKON Office Solutions, Inc. (2007) 148 Cal.App.4th 1440, 1450.
For purposes of demonstrating “typicality”, plaintiff must establish a “[t]he claims
or defenses of the representative plaintiffs are typical of the claims or defenses of the
class.” Civ. Code, § 1781(b)(3). California law requires only that the named plaintiff in
the class action and his/her claims are similarly situated to that of the other class
members. See, Richmond, 29 Cal.3d at p. 475; Classen v. Weller (1983) 145 Cal.App.3d
27, 46. "Typical" does ‘not mean "identical". Classen, at p. 46. A plaintiff's claim is
typical if it arises from the same event or practice or course of conduct that gives rise to
the claims of other class members, and if his or her claims are based on the same legal
theory.
California Supreme Court has explained:
[E]vidence that a representative is subject to unique defenses is one factor
to be considered in deciding the propriety of certification. [Citations.] The
specific danger a unique defense presents is that the class “representative
might devote time and effort to the defense at the expense of issues that
are common and controlling for the class.” [Citations.] ... [H]owever,
defendant's raising of unique defenses against a proposed class
representative does not automatically render the proposed representative
atypical. ... The risk posed by such defenses is the possibility they may
distract the class representative from common issues; hence, the relevant
inquiry is whether, and to what extent, the proffered defenses are “likely to
become a major focus of the litigation.” [Citations.]
Fireside Bank v. Superior Court (2007) 40 Cal.4th 1069, 1091.
To maintain a class action, a representative plaintiff must adequately protect the
interests of the class. Civil Code §1781(b)(4). Adequacy of representation has two
requirements: First, the named representative must be represented by counsel competent
and experienced in the kind of litigation to be undertaken. Second, there must be no
disabling conflicts of interest between the class representative and the class. McGhee v.
Bank of America (1976) 60 Cal.App.3d 442, 450.
“To resolve the adequacy question the court will evaluate the seriousness and
extent of conflicts involved compared to the importance of issues uniting the class, the
alternatives to class representation available, the procedures available to limit and prevent
unfairness, and any other facts bearing on the fairness with which the absent class
member is represent.” Martinez v. Joe’s Crab Shack Holdings (2014) 231 Cal.App.4"
362, 375.
If the proposed class representative plaintiff is not “adequate”, but class
certification is otherwise appropriate, the Court may allow plaintiff's counsel to substitute
anew class representation, or conditionally grant class certification subject to
presentation of a new “adequate” class representative. Lazar v. Hertz Corp. (1983) 143
Cal.App.3d 128.
Although Rule 23(b)(3) of the Federal Rules of Civil Procedure requires "that a
class action [be] superior to other available methods for the fair and efficient adjudication
of the controversy", while C.C.P. §382 and Civil Code §1781(b) do not mention such a
requirement, California courts often impose upon plaintiffs seeking class certification a
showing "that substantial benefits both to the litigants and to the court will result." City
of San Jose v. Superior Court (1974) 12 Cal.3d 447, 460. A Court should consider
whether it would be most beneficial and in the interests of judicial economy for the
claims to be adjudicated as a class action, versus adjudication of multiple individual
actions.
'
As the First Appellate District stated in Capitol People First v. State Dept. of
Developmental Services (2007) 155 Cal.App.4" 676, 689:
As well, in assessing the appropriateness of certification trial
courts are charged with carefully weighing the respective benefits and
burdens of class litigation to the end that maintenance of the class action
will only be permitted where substantial benefits accrue to the litigants
and the court. [Citation.] ... Further, the substantial benefits analysis
raises the question whether a class action is superior to individual lawsuits
and other alternative procedures for resolving the controversy. [Citations.]
See also, Soderstedt v. CBIZ Southern California LLC (2011) 197 Cal.App.4" 133, 156-
157. This was more recently referenced by the California Supreme Court in Brink:
Restaurant Corp. v. Superior Court (2012) 53 Cal.4" 1004, 1021, that class certification
includes consideration of whether “substantial benefits from certification that render
proceeding as a class superior to the alternatives.”
Nature and Scope of the Case and the Proposed Clas:
Plaintiffs! Nina Pescheke-Koedt, Emilio Diaz, Dan Slanker, Dawn Slanker and
Brenda Smith seek certification of a plaintiff class defined as follows:
All individuals who were live-aboard residents of Docktown
Marina on December 12, 2016, when the City [of Redwood City] released
the Docktown Plan and whether owner or renter.
1 At the time of filing the motion and the most recent complaint, Plaintiffs also
included Francesca Fambrough and Chris Tavenner, who have since settled and
dismissed their claims, and Thumper Smith who is now deceased.
7
(First Amended Complaint §20.) Plaintiffs have two causes of action (1) failure to
comply with and provide benefits under the California Relocation Assistance Law,
Government Code Sections 7260 et seg., and (2) inverse condemnation. The third cause
of action for Declaration Relief was the subject of demurrer sustained without leave to
amend. (CMC Order #3.) Plaintiffs’ previous motion for preliminary injunction was
denied.
The general nature of the case is as follows: For decades, people have been
allowed to live aboard boats and houseboats at the Docktown Marina in Redwood City.
In 2013, Redwood City took over management of the Docktown Marina. A lawsuit was
filed in 2015 alleging that the waterway at the Marina was subject to the Public Trust,
and sought to terminate all residential use of the Docktown Marina. Pursuant to
settlement of that lawsuit, the Docktown Plan was adopted by Redwood City in 2016,
establishing a plan to displace and remove all residential use of Docktown, including the
requirement that vessels be physically moved (or subject owners to nuisance abatement)
and providing certain benefits if residents cooperated in leaving. As part of this effort,
Redwood City forced residents to enter into a new live aboard lease, then used as the
,
foundation for ejecting residents.
Plaintiffs allege that they are entitled to relocation benefits under the California
Relocation Assistance Law, and are not limited to benefits under the Docktown Plan, and
seek damages for inverse condemnation as Redwood City is forcing them to leave on the
basis of the Public Trust and the new Docktown Plan.
v
Plaintiffs initially asserted that there are four common issues of aw that
predominate and support class certification: (1) whether the residents are entitled to
recover benefits under CRAL. (2) whether the City’s conduct constitutes inverse
condemnation, (3) whether the Docktown Plan was legal, and (4) whether the residential
use at the Docktown Marina is actually a violation of the Public Trust Doctrine. The last
two issues were part of the cause of action for declaratory relief, which was dismissed by
demurrer, and Plaintiffs conceded in their Reply and at oral argument that those two
issues were withdrawn.
Class Certification of the CRAL Claims Is Denied
Typicality and Representativeness
Lack of Typical Claims
Plaintiffs seek to represent a class of approximately 70 people who lived aboard a
vessel at the Docktown Marina, whether owner or renter, and assert claims for violationof
of CRAL and inverse condemnation. The vast majority of those putative class members
signed a “relocation agreement” with Defendant, agreeing to voluntarily move out and
receive benefits under the Docktown Plan. The relocation agreements contain a
release.
All of the named Plaintiffs seeking appointment as Class Representatives did not
sign a relocation agreement. Approximately 10 to 18 people are still living at Docktown
Marina, and the rest have moved out.
None of the Plaintiffs submitted declarations with the motion, and thus presented
no evidence of their adequacy as class representative and no evidence that their claims
are typical of the class claims.
Indeed, the undisputed evidence presented by Plaintiffs and Defendant is that the
claims of the named Plaintiffs are not typical of the claims of the vast majority of the
putative class.
By this lawsuit, Plaintiffs seek benefits under the California Relocation
Assistance Law, Government Code Sections 7260 et seg., and specifically Section 7262
(see First Amended Complaint 29). The primary claim Seeks recovery of money.
Although the Docktown Plan provides for payment of benefits (not under CRAL) before
the tenant moves, the CRAL does not provide for pre-moving payment of benefits.
CRAL benefits are triggered after the displaced person moves out. Kong v. City of
Hawaiian Gardens Redevelopment Agency (2002) 101 Cal.app.4"" 1317, 1326; Bi-Rite
Meat & Provisions Co. v. City of Hawaiian Gardens Redevelopment Agency (2007) 156
Cal.App.4"" 1419, 1431; Albright v. State of California (1979) 101 Cal.App.3d 14, 21;
Govt. Code §7260(c)(1)(A)(i).
Plaintiffs argue that they are typical of the claim that all of the live-aboards at
Docktown are entitled to CRAL benefits, and not limited to Docktown Plan benefits. But
the declaratory relief claim no longer exists. The cause of action is for CRAL benefits,
and thus adjudication of the claim potentially includes liability and damages.
The majority of the Class has moved out, but Plaintiffs have not. The majority of
the Class signed relocation agreements, but Plaintiffs have not.
Based upon the allegations and evidence presented in these related cases and
consideration of the Docktown Plan: Some members are only renters, some were
leaseholders, some were owners — all different property rights. Some lived on
houseboats, some lived on motorboats, some on sailboats — all different property values.
Some could not move their vessel and chose to accept funds from Defendant to have the
vessel removed and dismantled to avoid nuisance expenses. Some sold their vessels to
private parties. Some moved their vessels elsewhere.
10
Some people accepted relocation benefits under the Docktown Plan, some did not.
Some people administratively appealed their benefits determination, some did not. Some
people incurred moving expenses, some did not. Some people no longer live aboard their
vessel, but have entered into a berthing agreement to keep their vessel still docked at
Docktown.
Importantly, the vast majority of the putative Class members are subject to a
written release, which is a primary affirmative defense by Defendant. None of the named
Plaintiffs signed a release, and thus this is not a claim against them.
The Court finds that Plaintiffs failed to make a prima facie showing of typicality
for class certification.
Lack of Representative Adequacy
In their moving papers, plaintiffs seeking class certification are required to file a
declaration by each proposed class representative stating that the plaintiff understands
his/her fiduciary obligations to the class, and that he/she is willing and able to serve as an
adequate class representative. Jones v. farmers Ins. Exchange (2013) 221 Cal.App.4®
986, 998-999. None of the named Plaintiffs presented their own declaration. The
declaration of counsel saying so is insufficient. Id. Plaintiffs did not alternatively
provide any of their depositions testimony so stating, and the Plaintiffs’ deposition
excerpts provided by Defendants do not provide that information either.
As for the adequacy of counsel to serve as class counsel, the evidence presented
show a Jack of class action experience. Of the cases presented by Plaintiffs’ counsel in
their declarations as to their experience, only two cases were class actions (Seiken and De
Anza Cove). When questioned by the Court, Plaintiffs’ counsel indicated that they only
11
= ~
~
presented evidence of cases that went to trial, but presented no actual evidence of other
experience prosecuting cases that were certified as a class action pretrial.
Procedural defects in the motion papers also reflect minimal class certification
experience. For example: no plaintiff declarations; the Notice of Motion fails to state the
class definition, request appointment of specific persons as class representatives, and fails
to request appointment of class counsel; 700 pages of exhibits were attached to the
motion brief and not as exhibits to a declaration; and oath in Bartolotta declaration is
defective.
The Court understands the challenge of Plaintiffs finding counsel willing to
accept representation of this case, and the Court does not find that the inexperience of
counsel as the basis for denial of class certification, but it shows that there is a significant
lack of “counter-balance” weight to adequacy of counsel to offset the complete lack of
evidence as to adequacy of any of the named Plaintiffs as class representatives.
The Court finds that Plaintiffs failed to make a prima facie showing of adequacy
of representation.
Numerosity and Ascertainability
Given the typicality problems set forth above, the numerosity factor in class
certification is also in question. The evidence is unclear/contradictory as to the exact
number of class members and of any potential subclass. According to the declaration of
Margaret Harry, Defendant’s relocation consultant, there are “approximately 70 residents
who lived at Docktown in December 2016”. According to the Docktown Plan, there was
“approximately 65 Households [that] will need to relocate and take residence elsewhere
as a result of the relocation of Live Aboard occupancy at Docktown”.
12
Of those approximate 70 putative class members, according to Harry,
¢
approximately 60 of them has signed an Agreement ot Relocate (which includes a
release). According to her calculation, approximately 10 residents remain who have no
agreed to relocate. According to evidence of unlawful detainer actions brought by
Defendant against Docktown residents, there are approximately 18 marina slips subject to
tenancy.
If the Class was certified for all former and present live-aboard people, there
would be sufficient number of people to justify class certification. But then there is the
huge problem of lack of typicality between the Plaintiffs and that larger putative class.
On the other hand, if the class was only certified as to those persons who did not agree to
relocate by signing an Agreement to Relocate, which would include all of the named
Plaintiffs, there is between 10 and 18 people — likely less given that some of the Plaintiffs
have now withdrawn as Plaintiffs herein — which would not support class certification
rather than proceeding with individual actions/claims.
The Court finds that numerosity is questionable. The Court finds that Plaintiffs
did demonstrate ascertainability, as the identity of class members can be obtained through
the records of Defendant — who has leases, billing, and other documentation of which
slips were subject to live-aboard. That some people have relocated does not mean that
they cannot be identified.
Predominance of Common Issues of Law and Fact
By this lawsuit, Plaintiffs seek benefits under CRAL, which are not triggered until
the person moves. CRAL rights are subject to a separate “claim” requirement not the
general tort claim requirements. Accordingly the argument of Defendant that Plaintiffs
13
must have filed a pre-litigation government claim does not pose a significant or
predominating affirmative defense. On the other hand, it taises the factual issue of
whether each of putative class members who has moved out has complied with making a
“claim” under CRAL. There is also the individualized issue of whether each one is
entitled to CRAL benefits, and which benefits apply to him/her.
There is a predominating issue of the affirmative defense of written release, which
applies to'most of the putative class, but not to all, and not to the named Plaintiffs. The
issue as to the release is not the uniform language of the release itself, but rather the
circumstances under which each person signed the Agreement to Relocate. There can be
no Subclass of the “release” class members, because there is no proposed Class
Representative with that claim.
Although Plaintiffs argue that there is a predominating issue as to whether CRAL
applies, it is overwhelmed by the individual issues presented.
As set forth above, there is a lack of unity of circumstances for each of the live
aboard persons: Tenant versus Owner; Sold vessel, moved vessel, kept vessel berthed;
Actual expenses incurred versus benefits already received under the Docktown Plan and
Agreement to Relocate.
Plaintiffs claim under Government Code Section 7264 and Section 7264.Sthat
they and class members are entitled to affordable income housing to be provided by
Defendant — but there is no showing that the majority of members of the class want such
~ they might prefer to live in their present situs (which is unknown because there is no
evidence of their circumstance) — and might prefer to have the money not the housing.
All of these questions arise from the lack of a prima facie showing of predominance of
common issues of law and fact.
14
The Court finds that individual issues predominate over common issues.
Inverse Condemnation Claims Are Not Appropriate for Class Treatment
For the reasons set forth above, class certification is also not appropriate for the
inverse condemnation claim — indeed, more so.
This is a lawsuit for damages. One of the causes of action is for “inverse
condemnation”, which claim involves adjudication of whether there was a “taking” of
real property by a government entity, and determination of the monetary damages
therefor. .
California law reflects that a cause of action seeking real property damages or
injury to real property tights are generally not appropriate for class treatment, because
real property is unique, even if the cause of damages is the same.
In Knox v. Steatfield (1978) 79 Cal.App.3d 565, plaintiff brought a class action
on behalf of owners of real property located within the Malibu Bay Club, seeking
damages and injunctive relief for violation of the declaration of restrictions. In affirming
the dismissal of class action claims upon demurrer, the Court of Appeal held that
individual issues (not common issues) predominated as to claims for real property
damages for violations of common property restrictions, as real property is “unique”, and :
the basis of liability and calculation of damages depends upon individual circumstances.
While it has been held that a common recovery or a common fund
is not a prerequisite to a class action [citations], or that the damages need
not be the same for each member of the class, it is well settled that when
many issues have to be determined individually, the requirement of
common questions has not been satisfied. [Citations.] That is, one of the
15
purposes for which a class action is allowed, that of the efficient
administration of justice, is not served in that case.
Knox, at pp. 571-572.
In Bozaich v. State of California (1 973) 32 Cal.App.3d 688, the trial court struck
the class action allegations in the complaint, in the lawsuit on behalf of owners and
renters of real property subject to eminent domain. Plaintiffs claimed that they “had been
or were being required to move without any payment or remuneration for moving or
relocation expenses; [the lawsuit] sought reimbursement for such expenses in an
unspecified amount on behalf of the claimants and all other persons. who owned property
within the boundaries of the ‘State Capitol Plan’”. Id., at p. 691. The Court of Appeal, in
upholding the denial of class treatment, found that, even if common questions of law
existed, the individual issues predominated in such real property eminent domain cases:
Even if the common question of law were decided in appellants’
favor, the independent factual issues which would have to be separately
litigated in this case would be so numerous that the maintenance of the
alleged class action could not possibly serve the judicial process or the
parties involved. Following are some examples. Where, when and in
connection with what state project were the properties taken; what was the
nature of the claimant’s ownership in a particular parcel taken; what
relocation and moving expenses were incurred by the claimants; were the
moving and relocation expenses incurred as a direct and proximate
consequence of the taking; were any previous payments made to or
advantageous settlements bestowed upon an individual who is now
included as a member of the class; was the same legal issue litigated in a
16
separate eminent domain proceeding between the state and a member f the
class; could it have been litigated; what affirmative defenses does the state
have against each individual claimant?
Bozaich, at p. 695.
In City of San Jose v. Superior Court (1974) 12 Cal.3d 447, plaintiffs brought a
class action on behalf of real property owners whose property was located within the
flight path of San Jose Municipal Airport. The California Supreme Court held that class
certification must be denied (reversing the trial court’s grant of class treatment) on such
nuisance and inverse condemnation property damage claims, as the facts, liability and
damages were individualized, and thus common issues did not predominate. The idea of
lumping together certain subclasses would not solve the problem:
Second, the scheme is incompatible with the fundamental maxim
that each parcel of land is unique. [Citations.] ...
We decline to alter this rule of substantive law to make class
actions more available. Class actions are provided only as a means to
enforce substantive law. Altering the substantive law to accommodate
procedure would be to confuse the means with the ends — to sacrifice the
goal for the going.
City of San Jose, at pp. 461-462.
See also, Dept. of Fish & Game v. Superior Court (2011) 197 Cal.App.4"" 1323
(reversing trial court’s grant of class certification as to claim for inverse condemnation in
case by local property owners for diminishes property value and property damages
arising from government’s intentional pointing of lake); Eaton v. Ventura Port District
17
(1975) 45 Cal.App.3f 862 (denial of class certification and dismissal of class claims by
boat owners for property damages from the flooding of a marina).
The Court finds that inverse condemnation claims here are not appropriate for
class treatment, at the very least due to predominance of individual issues, and must be
adjudicated on an individual basis.
As for “superiority”, the Court finds that it would not serve judicial economy to
proceed with adjudication of these claims as a class, and the superior method of
adjudication is by individual claims.
Me
DATED: December 27, 2018
HON. MARIE S. WEINER
JUDGE OF THE SUPERIOR COURT
18
Preview
2 ‘SAN MATEO COUNTY 1D DEC 27 2018 e Supefjbr Court Clerk By ( DRA i SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF SAN MATEO FRANCESCA FAMBROUGH, et al. Civil No. 17CIV05387 CLASS ACTION Plaintiffs, Assigned for All Purposes to VS. Hon. Marie S. Weiner, Dept. 2 REDWOOD CITY, CASE MANAGEMENT ORDER #9 Defendant. On October 17, 2018, hearing was held on Plaintiffs’ Motion for Class Certification in Department 2 of this Court before the Honorable Marie S. Weiner. Karen Frostrom of Thorsnes Bartolotta McGuire LLP appeared on behalf of Plaintiffs; and Kevin Siegel of Burke Williams & Sorenson LLP appeared on behalf of Defendant. Upon due consideration of the briefs and evidence presented, and the oral argument of counsel, and the Court having g taken the matter under submission, IT IS HEREBY ORDERED as follows Plaintiffs’ Motion for Class Certification is DENIED Plaintiff's requests for judicial notice are GRANTED. \3 {7.05387 | tae Management Order 1 ifttnmnay Leave is GRANTED for any putative class members to file a motion to intervene to be added as a named Plaintiff to pursue an individual claim for CRAL or inverse condemnation. THE COURT FINDS as follows: Standards for Class Certification California courts have readily aocepted and utilized the class action procedure to resolve multiparty controversies. See Richmond v. Dart Industries, Inc. (1981) 29 Cal.3d 462, 469. Under Code of Civil Procedure Section 382, the California class action statute, there are two basic prerequisites to certification: (1) the existence of an ascertainable class, and (2) a well-defined community of interest in the questions of law and fact involved affecting the parties to be represented. Occidental Land, Inc. v. Superior Court (1976) 18 Cal.3d 355, 360; Daar v. Yellow Cab Company (1967) 67 Cal.2d 695, 704. Because Section 382 does not establish a procedural framework for class actions, the California Supreme Court has directed trial courts to utilize the procedures prescribed by the Consumers Legal Remedies Act (Civil Code §§1750, et seq.) in all class actions. Civil Service Employees Insurance Company v. Superior Court (1978) 22 Cal.3d 362, 376; Vasquez v. Superior Court (1971) 4 Cal.3d 800, 820. California trial courts have also been directed to look to Rule 23 of the Federal Rules of Civil Procedure and the , cases thereunder for guidance. Id., at p. 821, La Sala v. American S&L Assn. (1971) 5 Cal.3d 864, 872; Howard Gunty Profit Sharing Plan v. Superior Court (2001) 88 Cal.App.4th 572, 580 fn. 8. Civil Code Section 1781(b) provides: The court shall permit the suit to be maintained on behalf of all members of the representative class if all of the following conditions exist: (1) It is impracticable to bring all members of the class before the court. (2) The questions of law or fact common to the class are substantially similar and predominate over the questions affecting the individual members. (3) The claims or defenses of the representative plaintiffs are typical of the claims or defenses of the class. (4) The representative plaintiff will fairly and adequately protect the interests of the class. The merits of plaintiffs' class claims are generally irrelevant for purposes of class certification. See, Green v. Obledo (1981) 29 Cal.3d 126, 146; Anthony v. General Motors Corp. (1973) 33 Cal.App.3d 699, 707. “The certification question is ‘essentially a procedural one that does not ask whether an action is legally or factually meritorious.’ [Citation.]” Sav-On Drug Stores, Inc. v. Superior Court (2004) 34 Cal.4th 319, 326. In addressing the element of whether it is “impracticable” to bring all members of the class before the court, the Court should be presented with evidence of the approximately size of the class. The number of putative class members should be sufficiently “numerous” to merit use of the class procedure. Numerosity for class certification might be as low as 30, or be in the hundreds or thousands of people. Typically, the numerosity requirement is not contested by the defendant. It is clear under California law that the "ascertainable class" requirement does not require plaintiff to establish the existence and identity of the individual class members. Daar, 67 Cal.2d at p. 706; Reyes v. Board of Supervisors (1987) 196 Cal.App.3d 1263, 1274; Stephens v. Montgomery Ward (1987) 193 Cal.App.3d 411, 419. "Whether a class is ascertainable is determined by examining (1) the class definition, (2) the size of the class, and (3) the means available for identifying class members." Reyes, at p. 1271. The second requirement of Civil Code Section 1781(b) is that: "[t]he questions of law or fact common to the class [be] substantially similar and predominate over questions affecting the individual members." Section 1781(b) codified the common law requirement that plaintiff show a well-defined "community of interest" in the questions of law and fact involved. E.g., Hogya v. Superior Court (1977) 75 Cal.App.3d 122, 136. For purposes of satisfying the "community of interest" prerequisite under C.C.P. Section 382, the plaintiff need only demonstrate that "there are predominate questions of law or fact common to the class as a whole." Reyes v. Board of Supervisors (1987) 196 Cal.App.3d 1263, 1277. The existence of any individual issues does not preclude class certification. "[T]he necessity for class members to individually establish eligibility and damages does not mean individual fact questions predominate." Id., at p. 1278. Although common issues must predominate for certification of a class, it is not required that all of the issues be common. The Court must also contemplate affirmative defenses on class certification. "In determining whether common issues 'predominate,' courts consider both plaintiff's legal theories and defendant's affirmative defenses." Weil & Brown, Cal. Prac. Guide: Civ. Proc. Before Trial (Rutter, Jun. 2017 Update) { 14:15. "Defendant's affirmative defenses must also be considered because certification may be denied where individual issues presented by the affirmative defenses predominate over common issues." Id. at J 14:99; see also, Walsh v. IKON Office Solutions, Inc. (2007) 148 Cal.App.4th 1440, 1450. For purposes of demonstrating “typicality”, plaintiff must establish a “[t]he claims or defenses of the representative plaintiffs are typical of the claims or defenses of the class.” Civ. Code, § 1781(b)(3). California law requires only that the named plaintiff in the class action and his/her claims are similarly situated to that of the other class members. See, Richmond, 29 Cal.3d at p. 475; Classen v. Weller (1983) 145 Cal.App.3d 27, 46. "Typical" does ‘not mean "identical". Classen, at p. 46. A plaintiff's claim is typical if it arises from the same event or practice or course of conduct that gives rise to the claims of other class members, and if his or her claims are based on the same legal theory. California Supreme Court has explained: [E]vidence that a representative is subject to unique defenses is one factor to be considered in deciding the propriety of certification. [Citations.] The specific danger a unique defense presents is that the class “representative might devote time and effort to the defense at the expense of issues that are common and controlling for the class.” [Citations.] ... [H]owever, defendant's raising of unique defenses against a proposed class representative does not automatically render the proposed representative atypical. ... The risk posed by such defenses is the possibility they may distract the class representative from common issues; hence, the relevant inquiry is whether, and to what extent, the proffered defenses are “likely to become a major focus of the litigation.” [Citations.] Fireside Bank v. Superior Court (2007) 40 Cal.4th 1069, 1091. To maintain a class action, a representative plaintiff must adequately protect the interests of the class. Civil Code §1781(b)(4). Adequacy of representation has two requirements: First, the named representative must be represented by counsel competent and experienced in the kind of litigation to be undertaken. Second, there must be no disabling conflicts of interest between the class representative and the class. McGhee v. Bank of America (1976) 60 Cal.App.3d 442, 450. “To resolve the adequacy question the court will evaluate the seriousness and extent of conflicts involved compared to the importance of issues uniting the class, the alternatives to class representation available, the procedures available to limit and prevent unfairness, and any other facts bearing on the fairness with which the absent class member is represent.” Martinez v. Joe’s Crab Shack Holdings (2014) 231 Cal.App.4" 362, 375. If the proposed class representative plaintiff is not “adequate”, but class certification is otherwise appropriate, the Court may allow plaintiff's counsel to substitute anew class representation, or conditionally grant class certification subject to presentation of a new “adequate” class representative. Lazar v. Hertz Corp. (1983) 143 Cal.App.3d 128. Although Rule 23(b)(3) of the Federal Rules of Civil Procedure requires "that a class action [be] superior to other available methods for the fair and efficient adjudication of the controversy", while C.C.P. §382 and Civil Code §1781(b) do not mention such a requirement, California courts often impose upon plaintiffs seeking class certification a showing "that substantial benefits both to the litigants and to the court will result." City of San Jose v. Superior Court (1974) 12 Cal.3d 447, 460. A Court should consider whether it would be most beneficial and in the interests of judicial economy for the claims to be adjudicated as a class action, versus adjudication of multiple individual actions. ' As the First Appellate District stated in Capitol People First v. State Dept. of Developmental Services (2007) 155 Cal.App.4" 676, 689: As well, in assessing the appropriateness of certification trial courts are charged with carefully weighing the respective benefits and burdens of class litigation to the end that maintenance of the class action will only be permitted where substantial benefits accrue to the litigants and the court. [Citation.] ... Further, the substantial benefits analysis raises the question whether a class action is superior to individual lawsuits and other alternative procedures for resolving the controversy. [Citations.] See also, Soderstedt v. CBIZ Southern California LLC (2011) 197 Cal.App.4" 133, 156- 157. This was more recently referenced by the California Supreme Court in Brink: Restaurant Corp. v. Superior Court (2012) 53 Cal.4" 1004, 1021, that class certification includes consideration of whether “substantial benefits from certification that render proceeding as a class superior to the alternatives.” Nature and Scope of the Case and the Proposed Clas: Plaintiffs! Nina Pescheke-Koedt, Emilio Diaz, Dan Slanker, Dawn Slanker and Brenda Smith seek certification of a plaintiff class defined as follows: All individuals who were live-aboard residents of Docktown Marina on December 12, 2016, when the City [of Redwood City] released the Docktown Plan and whether owner or renter. 1 At the time of filing the motion and the most recent complaint, Plaintiffs also included Francesca Fambrough and Chris Tavenner, who have since settled and dismissed their claims, and Thumper Smith who is now deceased. 7 (First Amended Complaint §20.) Plaintiffs have two causes of action (1) failure to comply with and provide benefits under the California Relocation Assistance Law, Government Code Sections 7260 et seg., and (2) inverse condemnation. The third cause of action for Declaration Relief was the subject of demurrer sustained without leave to amend. (CMC Order #3.) Plaintiffs’ previous motion for preliminary injunction was denied. The general nature of the case is as follows: For decades, people have been allowed to live aboard boats and houseboats at the Docktown Marina in Redwood City. In 2013, Redwood City took over management of the Docktown Marina. A lawsuit was filed in 2015 alleging that the waterway at the Marina was subject to the Public Trust, and sought to terminate all residential use of the Docktown Marina. Pursuant to settlement of that lawsuit, the Docktown Plan was adopted by Redwood City in 2016, establishing a plan to displace and remove all residential use of Docktown, including the requirement that vessels be physically moved (or subject owners to nuisance abatement) and providing certain benefits if residents cooperated in leaving. As part of this effort, Redwood City forced residents to enter into a new live aboard lease, then used as the , foundation for ejecting residents. Plaintiffs allege that they are entitled to relocation benefits under the California Relocation Assistance Law, and are not limited to benefits under the Docktown Plan, and seek damages for inverse condemnation as Redwood City is forcing them to leave on the basis of the Public Trust and the new Docktown Plan. v Plaintiffs initially asserted that there are four common issues of aw that predominate and support class certification: (1) whether the residents are entitled to recover benefits under CRAL. (2) whether the City’s conduct constitutes inverse condemnation, (3) whether the Docktown Plan was legal, and (4) whether the residential use at the Docktown Marina is actually a violation of the Public Trust Doctrine. The last two issues were part of the cause of action for declaratory relief, which was dismissed by demurrer, and Plaintiffs conceded in their Reply and at oral argument that those two issues were withdrawn. Class Certification of the CRAL Claims Is Denied Typicality and Representativeness Lack of Typical Claims Plaintiffs seek to represent a class of approximately 70 people who lived aboard a vessel at the Docktown Marina, whether owner or renter, and assert claims for violationof of CRAL and inverse condemnation. The vast majority of those putative class members signed a “relocation agreement” with Defendant, agreeing to voluntarily move out and receive benefits under the Docktown Plan. The relocation agreements contain a release. All of the named Plaintiffs seeking appointment as Class Representatives did not sign a relocation agreement. Approximately 10 to 18 people are still living at Docktown Marina, and the rest have moved out. None of the Plaintiffs submitted declarations with the motion, and thus presented no evidence of their adequacy as class representative and no evidence that their claims are typical of the class claims. Indeed, the undisputed evidence presented by Plaintiffs and Defendant is that the claims of the named Plaintiffs are not typical of the claims of the vast majority of the putative class. By this lawsuit, Plaintiffs seek benefits under the California Relocation Assistance Law, Government Code Sections 7260 et seg., and specifically Section 7262 (see First Amended Complaint 29). The primary claim Seeks recovery of money. Although the Docktown Plan provides for payment of benefits (not under CRAL) before the tenant moves, the CRAL does not provide for pre-moving payment of benefits. CRAL benefits are triggered after the displaced person moves out. Kong v. City of Hawaiian Gardens Redevelopment Agency (2002) 101 Cal.app.4"" 1317, 1326; Bi-Rite Meat & Provisions Co. v. City of Hawaiian Gardens Redevelopment Agency (2007) 156 Cal.App.4"" 1419, 1431; Albright v. State of California (1979) 101 Cal.App.3d 14, 21; Govt. Code §7260(c)(1)(A)(i). Plaintiffs argue that they are typical of the claim that all of the live-aboards at Docktown are entitled to CRAL benefits, and not limited to Docktown Plan benefits. But the declaratory relief claim no longer exists. The cause of action is for CRAL benefits, and thus adjudication of the claim potentially includes liability and damages. The majority of the Class has moved out, but Plaintiffs have not. The majority of the Class signed relocation agreements, but Plaintiffs have not. Based upon the allegations and evidence presented in these related cases and consideration of the Docktown Plan: Some members are only renters, some were leaseholders, some were owners — all different property rights. Some lived on houseboats, some lived on motorboats, some on sailboats — all different property values. Some could not move their vessel and chose to accept funds from Defendant to have the vessel removed and dismantled to avoid nuisance expenses. Some sold their vessels to private parties. Some moved their vessels elsewhere. 10 Some people accepted relocation benefits under the Docktown Plan, some did not. Some people administratively appealed their benefits determination, some did not. Some people incurred moving expenses, some did not. Some people no longer live aboard their vessel, but have entered into a berthing agreement to keep their vessel still docked at Docktown. Importantly, the vast majority of the putative Class members are subject to a written release, which is a primary affirmative defense by Defendant. None of the named Plaintiffs signed a release, and thus this is not a claim against them. The Court finds that Plaintiffs failed to make a prima facie showing of typicality for class certification. Lack of Representative Adequacy In their moving papers, plaintiffs seeking class certification are required to file a declaration by each proposed class representative stating that the plaintiff understands his/her fiduciary obligations to the class, and that he/she is willing and able to serve as an adequate class representative. Jones v. farmers Ins. Exchange (2013) 221 Cal.App.4® 986, 998-999. None of the named Plaintiffs presented their own declaration. The declaration of counsel saying so is insufficient. Id. Plaintiffs did not alternatively provide any of their depositions testimony so stating, and the Plaintiffs’ deposition excerpts provided by Defendants do not provide that information either. As for the adequacy of counsel to serve as class counsel, the evidence presented show a Jack of class action experience. Of the cases presented by Plaintiffs’ counsel in their declarations as to their experience, only two cases were class actions (Seiken and De Anza Cove). When questioned by the Court, Plaintiffs’ counsel indicated that they only 11 = ~ ~ presented evidence of cases that went to trial, but presented no actual evidence of other experience prosecuting cases that were certified as a class action pretrial. Procedural defects in the motion papers also reflect minimal class certification experience. For example: no plaintiff declarations; the Notice of Motion fails to state the class definition, request appointment of specific persons as class representatives, and fails to request appointment of class counsel; 700 pages of exhibits were attached to the motion brief and not as exhibits to a declaration; and oath in Bartolotta declaration is defective. The Court understands the challenge of Plaintiffs finding counsel willing to accept representation of this case, and the Court does not find that the inexperience of counsel as the basis for denial of class certification, but it shows that there is a significant lack of “counter-balance” weight to adequacy of counsel to offset the complete lack of evidence as to adequacy of any of the named Plaintiffs as class representatives. The Court finds that Plaintiffs failed to make a prima facie showing of adequacy of representation. Numerosity and Ascertainability Given the typicality problems set forth above, the numerosity factor in class certification is also in question. The evidence is unclear/contradictory as to the exact number of class members and of any potential subclass. According to the declaration of Margaret Harry, Defendant’s relocation consultant, there are “approximately 70 residents who lived at Docktown in December 2016”. According to the Docktown Plan, there was “approximately 65 Households [that] will need to relocate and take residence elsewhere as a result of the relocation of Live Aboard occupancy at Docktown”. 12 Of those approximate 70 putative class members, according to Harry, ¢ approximately 60 of them has signed an Agreement ot Relocate (which includes a release). According to her calculation, approximately 10 residents remain who have no agreed to relocate. According to evidence of unlawful detainer actions brought by Defendant against Docktown residents, there are approximately 18 marina slips subject to tenancy. If the Class was certified for all former and present live-aboard people, there would be sufficient number of people to justify class certification. But then there is the huge problem of lack of typicality between the Plaintiffs and that larger putative class. On the other hand, if the class was only certified as to those persons who did not agree to relocate by signing an Agreement to Relocate, which would include all of the named Plaintiffs, there is between 10 and 18 people — likely less given that some of the Plaintiffs have now withdrawn as Plaintiffs herein — which would not support class certification rather than proceeding with individual actions/claims. The Court finds that numerosity is questionable. The Court finds that Plaintiffs did demonstrate ascertainability, as the identity of class members can be obtained through the records of Defendant — who has leases, billing, and other documentation of which slips were subject to live-aboard. That some people have relocated does not mean that they cannot be identified. Predominance of Common Issues of Law and Fact By this lawsuit, Plaintiffs seek benefits under CRAL, which are not triggered until the person moves. CRAL rights are subject to a separate “claim” requirement not the general tort claim requirements. Accordingly the argument of Defendant that Plaintiffs 13 must have filed a pre-litigation government claim does not pose a significant or predominating affirmative defense. On the other hand, it taises the factual issue of whether each of putative class members who has moved out has complied with making a “claim” under CRAL. There is also the individualized issue of whether each one is entitled to CRAL benefits, and which benefits apply to him/her. There is a predominating issue of the affirmative defense of written release, which applies to'most of the putative class, but not to all, and not to the named Plaintiffs. The issue as to the release is not the uniform language of the release itself, but rather the circumstances under which each person signed the Agreement to Relocate. There can be no Subclass of the “release” class members, because there is no proposed Class Representative with that claim. Although Plaintiffs argue that there is a predominating issue as to whether CRAL applies, it is overwhelmed by the individual issues presented. As set forth above, there is a lack of unity of circumstances for each of the live aboard persons: Tenant versus Owner; Sold vessel, moved vessel, kept vessel berthed; Actual expenses incurred versus benefits already received under the Docktown Plan and Agreement to Relocate. Plaintiffs claim under Government Code Section 7264 and Section 7264.Sthat they and class members are entitled to affordable income housing to be provided by Defendant — but there is no showing that the majority of members of the class want such ~ they might prefer to live in their present situs (which is unknown because there is no evidence of their circumstance) — and might prefer to have the money not the housing. All of these questions arise from the lack of a prima facie showing of predominance of common issues of law and fact. 14 The Court finds that individual issues predominate over common issues. Inverse Condemnation Claims Are Not Appropriate for Class Treatment For the reasons set forth above, class certification is also not appropriate for the inverse condemnation claim — indeed, more so. This is a lawsuit for damages. One of the causes of action is for “inverse condemnation”, which claim involves adjudication of whether there was a “taking” of real property by a government entity, and determination of the monetary damages therefor. . California law reflects that a cause of action seeking real property damages or injury to real property tights are generally not appropriate for class treatment, because real property is unique, even if the cause of damages is the same. In Knox v. Steatfield (1978) 79 Cal.App.3d 565, plaintiff brought a class action on behalf of owners of real property located within the Malibu Bay Club, seeking damages and injunctive relief for violation of the declaration of restrictions. In affirming the dismissal of class action claims upon demurrer, the Court of Appeal held that individual issues (not common issues) predominated as to claims for real property damages for violations of common property restrictions, as real property is “unique”, and : the basis of liability and calculation of damages depends upon individual circumstances. While it has been held that a common recovery or a common fund is not a prerequisite to a class action [citations], or that the damages need not be the same for each member of the class, it is well settled that when many issues have to be determined individually, the requirement of common questions has not been satisfied. [Citations.] That is, one of the 15 purposes for which a class action is allowed, that of the efficient administration of justice, is not served in that case. Knox, at pp. 571-572. In Bozaich v. State of California (1 973) 32 Cal.App.3d 688, the trial court struck the class action allegations in the complaint, in the lawsuit on behalf of owners and renters of real property subject to eminent domain. Plaintiffs claimed that they “had been or were being required to move without any payment or remuneration for moving or relocation expenses; [the lawsuit] sought reimbursement for such expenses in an unspecified amount on behalf of the claimants and all other persons. who owned property within the boundaries of the ‘State Capitol Plan’”. Id., at p. 691. The Court of Appeal, in upholding the denial of class treatment, found that, even if common questions of law existed, the individual issues predominated in such real property eminent domain cases: Even if the common question of law were decided in appellants’ favor, the independent factual issues which would have to be separately litigated in this case would be so numerous that the maintenance of the alleged class action could not possibly serve the judicial process or the parties involved. Following are some examples. Where, when and in connection with what state project were the properties taken; what was the nature of the claimant’s ownership in a particular parcel taken; what relocation and moving expenses were incurred by the claimants; were the moving and relocation expenses incurred as a direct and proximate consequence of the taking; were any previous payments made to or advantageous settlements bestowed upon an individual who is now included as a member of the class; was the same legal issue litigated in a 16 separate eminent domain proceeding between the state and a member f the class; could it have been litigated; what affirmative defenses does the state have against each individual claimant? Bozaich, at p. 695. In City of San Jose v. Superior Court (1974) 12 Cal.3d 447, plaintiffs brought a class action on behalf of real property owners whose property was located within the flight path of San Jose Municipal Airport. The California Supreme Court held that class certification must be denied (reversing the trial court’s grant of class treatment) on such nuisance and inverse condemnation property damage claims, as the facts, liability and damages were individualized, and thus common issues did not predominate. The idea of lumping together certain subclasses would not solve the problem: Second, the scheme is incompatible with the fundamental maxim that each parcel of land is unique. [Citations.] ... We decline to alter this rule of substantive law to make class actions more available. Class actions are provided only as a means to enforce substantive law. Altering the substantive law to accommodate procedure would be to confuse the means with the ends — to sacrifice the goal for the going. City of San Jose, at pp. 461-462. See also, Dept. of Fish & Game v. Superior Court (2011) 197 Cal.App.4"" 1323 (reversing trial court’s grant of class certification as to claim for inverse condemnation in case by local property owners for diminishes property value and property damages arising from government’s intentional pointing of lake); Eaton v. Ventura Port District 17 (1975) 45 Cal.App.3f 862 (denial of class certification and dismissal of class claims by boat owners for property damages from the flooding of a marina). The Court finds that inverse condemnation claims here are not appropriate for class treatment, at the very least due to predominance of individual issues, and must be adjudicated on an individual basis. As for “superiority”, the Court finds that it would not serve judicial economy to proceed with adjudication of these claims as a class, and the superior method of adjudication is by individual claims. Me DATED: December 27, 2018 HON. MARIE S. WEINER JUDGE OF THE SUPERIOR COURT 18