July 2010

Definition of "Son or Daughter" in FMLA Expanded by Department of Labor Opinion Letter

July 6, 2010, by Meyers Nave

The U.S. Department of Labor issued an Opinion Letter clarifying that an employee who has day-to-day responsibilities to either care for or financially support a child qualifies for leave under the Family and Medical Leave Act (FMLA), even if the employee has no biological or legal relationship with the child. Furthermore, leave may be granted to an employee who stands in place of a parent even where a child has one biological parent in the home, or has both a mother and father.

This interpretation of the FMLA comports with Congress' legislative intent for a liberal construction of "son or daughter," which was meant to cover employees from families other than those where two biological or legal parents primarily care for a child. Employees from these so-called "non-traditional families" may now take FMLA leave to care for a child as their "son or daughter" so long as they can provide reasonable documentation or a statement of the family relationship at the employer's request. The employee's statement need only assert that the requisite family relationship exists.

While all "non-traditional families" stand to benefit, this Opinion Letter has the most significance for employees from the lesbian, gay, bisexual, and transgender community, which the Secretary of Labor identified as disproportionately impacted by the FMLA's earlier ambiguity in this particular area of the law.

Go here to read the full analysis of the Department of Labor's Opinion Letter.

Public Agencies Must Usually Seek Relief From PERB And Not The Courts When A Threatened Strike Will Endanger Public Welfare

July 7, 2010, by Meyers Nave

Last week, in City of San Jose v. Operating Engineers Local Union No. 3, the California Supreme Court held that a public employer must generally first seek relief from the Public Employment Relations Board (PERB) before asking a superior court for injunctive relief when the employer believes that a threatened strike may endanger the public welfare. The Court noted that the Legislature expressly vested initial jurisdiction over claims of unfair labor practices arising under the Meyers-Milias-Brown Act (MMBA) with PERB. Because the Court felt that a public entity's claim that a threatened employee strike is illegal will generally constitute an unfair labor practice claim, PERB would have initial jurisdiction.

The Court explained that PERB has initial jurisdiction over a claim by a public entity that a strike by its employees is illegal, and thus the public entity must exhaust its administrative remedies with PERB prior to seeking judicial relief unless one of the recognized exceptions to the exhaustion doctrine applied. The Court set forth some of these exceptions, including inadequate remedy, too slow an administrative procedure to be effective, irreparable harm would result by requiring exhaustion and pursuing administrative remedies would be futile. The Court held that none of these exceptions applied in this particular case.

The California Supreme Court concluded that labor disputes asserting unfair labor practices under the MMBA should, whenever possible, be submitted first to PERB rather than to a court. And, if an agency claims an exception to the doctrine of exhaustion of remedies in connection with a public employee strike, the trial court should afford due deference to PERB and issue injunctive relief only when it is clearly shown that PERB's remedy would be inadequate.

Go here to read the full analysis of City of San Jose v. Operating Engineers Local Union No. 3.

Home on the Range: Ninth Circuit Affirms U.S. Fish and Wildlife Service’s Significant Discretion in Designating Critical Habitat for Endangered Species

July 8, 2010, by Dawn McIntosh

The U.S. Fish and Wildlife Service ("Service") is often beset with litigation when it designates critical habitat for a species listed as endangered or threatened under the Endangered Species Act (“ESA”)--by environmentalists who feel the designation is insufficient, and by industry representatives who argue that it is too broad. In Arizona Cattle Growers' Association v. Salazar, the Ninth Circuit not only affirmed a ruling upholding a particular designation by the Service but, more importantly, clarified for all future cases that, when the Service uses its expertise to make a scientific determination--as it does when designating critical habitat--a reviewing court "must generally be at its most deferential."

Arizona Cattle Growers' Assn. sued the Service to challenge the critical habitat designation for the Mexican Spotted Owl, claiming that the Service 1) treated areas where no owls were found as "occupied" and 2) incorrectly applied the "baseline" approach in assessing the economic impacts of its designation. That approach only considers the economic impacts of the critical habitat designation and does not take into consideration the economic impacts of listing the species as endangered or threatened in the first place.

The Court found the term "occupied" to be ambiguous, but determined that the Service's interpretation was reasonable--particularly in light of its mandate to make conservative decisions for the protection of listed species The Court also found that substantial information in the record supported the Service's interpretation. Turning to the “baseline” argument, the Court found the Service's economic analysis appropriate, rejecting a 2001 opinion by the Tenth Circuit that found the same “baseline” approach impermissible under the ESA. (Follow link to N.M. Cattle Growers Ass’n v. U.S. Fish and Wildlife Service.) The Ninth Circuit had previously rejected the Tenth Circuit’s reasoning, the current panel explained, in a 2004 decision, Gifford Pinchot Task Force v. U.S. Fish and Wildlife Service. The Court also found the baseline approach logical and consistent with Congressional intent. The ESA directs the Service to consider the economic impacts of critical habitat designations, but not of listing determinations.

The Service has rarely found economic impacts from critical habitat designations that could not be attributed to the original listing, The distinction is important, however, because the Service may exclude an area from a critical habitat designation if the economic impacts of including the area in the designation outweigh the benefits to the species. Given that recent court decisions have found that adverse modification of critical habitat is a different standard than jeopardizing the species, it remains to be seen if the Service will adjust its economic analysis of critical habitat designations to tease apart the economic impacts attributable solely to that determination.

New Stormwater Construction Permit Requirements Went Into Effect Last Week

July 8, 2010, by Meyers Nave

The California State Water Resources Control Board substantially revised the statewide General Permit for Discharges of Storm Waters Associated with Construction Sites that regulates water quality at construction sites ("Construction General Permit") (See Order No. 2009-009 DWQ.) The new requirements, which take effect July 1, 2010, will significantly impact the planning and management of projects that are more than one acre in size.

The new Construction General Permit applies to any construction or demolition activity that results in a land disturbance of one acre or more, or of land disturbances of less than one acre, if the construction is part of a larger common plan of development, or the sale of one or more acres of disturbed land surface. The new Construction General Permit also applies to construction activities associated with Linear Underground/Overhead Projects ("LUPs"); discharges of sediment from construction activities associated with oil and gas exploration, production/processing/treatment operations, or transmission facilities; and storm water discharges from dredge spoil placement that occur outside the jurisdiction of the U.S. Army Corps of Engineers.

Previously, the regulation of storm water discharges from construction sites consisted primarily of the development of a Storm Water Pollution Prevention Plan ("SWPPP") and the implementation of Best Management Practices ("BMPs"). The new Construction General Permit, however, mandates several new monitoring and reporting requirements that are each individually enforceable.

In order to obtain coverage under the new Construction General Permit, the following five documents and appropriate fee must be filed electronically with the State Water Resources Control Board: notice of intent to comply, site map, site risk assessment, SWPPP, and signed certification statement. 

FPPC Eyes Amendments to the Political Reform Act

July 9, 2010, by Meyers Nave

The Sacramento Bee is reporting that the Fair Political Practices Commission (FPPC) will create a task force to recommend amendments to the Political Reform Act. According to the Bee, the task force will focus its attention on aspects of the Act governing campaign activities, including disclosure requirements for independent campaign expenditures and regulations related to issue advocacy.

The Political Reform Act is the primary source of statutory law in California regarding conflicts of interest for governmental officials. The Act also regulates the reporting and disclosure of economic interests, gift and honoraria limits, and campaign contributions. The FPPC is the state agency charged with the enforcement of the Political Reform Act and the adoption of regulations implementing the Act.

The Sacramento Bee's full report can be found here.

Public Works Contractors Need Not Show Fraudulent Intent to Recover Damages Caused by Incorrect Plans and Specifications

July 16, 2010, by Meyers Nave

In Los Angeles Unified School District v. Great American Insurance Co. S165113, a decision filed July 12, 2010, the California Supreme Court decided whether a contractor on a public works project may recover in a contract action for extra work or expenses necessitated by a public entity's failure to disclose information that materially affects the cost of performance. The decision eliminated a long-standing split in the Courts of Appeal as to whether a contractor needs to show fraudulent intent on the part of the public entity in order to recover for extra work or expenses. Read more here.

Déjà Re-Vu: L.A.-based Court of Appeal Rejects City’s Anti-SLAPP Motion; Cal. Supreme Court Declines to Review

July 22, 2010, by Meyers Nave

Last week, the Court declined to review—and so left standing as good law—an opinion by the Second District Court of Appeal setting out a narrow view of when public entities can use the anti-SLAPP statute. That statute authorizes quick dismissal of meritless suits if they are based on a defendant’s speech or petitioning. It’s the second time this year that the L.A.-based Second District has published an opinion rejecting a city’s anti-SLAPP motion, and the Supreme Court has denied review. Those denials do not mean that the Court has approved the analyses in USA Waste of Cal., Inc. v. City Of Irwindale (2010) 184 Cal. App. 4th 53, or Graffiti Protective Coatings, Inc. v. City of Pico Rivera (2010) 181 Cal.App.4th 1207 (GPC). But they do leave the opinions on the books. That makes the opinions binding on trial courts—though not on other courts of appeal.

In USA Waste, a city adopted guidelines for back-fill projects, applied them to an ongoing project of USA Waste’s, and issued a Notice of Violation (NOV). USA Waste believed that a pre-existing Reclamation Plan and contract barred the City from applying the new guidelines to it. It asserted various claims, and the City replied with an anti-SLAPP motion. The claims, the City argued, were based on its speech—to wit, the NOV.

No, they weren't, said the court of appeal: the root of the claims was the underlying dispute over whether the guidelines apply, not the act of issuing an NOV. Suits "to enforce, interpret or invalidate ... laws," it said, are "generally not subject to being stricken under the anti-SLAPP statute." Otherwise, "efforts to challenge governmental action would be burdened."

For that idea, USA Waste cites GPC. GPC, a terminated contractor, sued to nullify its successor’s contract, claiming that the City had ignored com- petitive bidding laws. In rejecting the City's anti-SLAPP motion, the court held that the suit wasn't based on the City's speech in dealing with the rival contractors, but on its act of awarding a contract without first taking bids.

While the Supreme Court's denials of review leave USA Waste and GPC on the books, and binding on trial courts, they still leave other courts of appeal with room to disagree. The Court affirmed just last year that cities can file anti-SLAPP motions in proper cases. (Vargas v. City of Salinas (2009) 46 Cal.4th 1, 17.) Even in USA Waste, one Justice wrote separately that he found the case much closer than his colleagues. But the L.A.-based court of appeal as a whole seems to be charting a narrow course for public entities’ anti-SLAPP motions.

Court of Appeal Postpones Ruling on the Validity of City of Anaheim's Ordinance Bannning Medical Marijuana Dispensaries

July 23, 2010, by Meyers Nave

July 19, 2010 has come and gone and there has been no sign of the much anticipated decision in Qualified Patients Association v. City of Anaheim, Case No. G040077. The California Court of Appeal, Fourth District, Division Three, vacated the submission of the parties and re-submitted the matter for an additional 30 days (i.e. August 18, 2010).

At issue in this case is the validity of City of Anaheim's ("Anaheim") ordinance banning medical marijuana dispensaries. The appeal arises out of the trial court's ruling sustaining Anaheim's demurrer and holding that the ordinance is not preempted by California's Compassionate Use Act and Medical Marijuana Program. A more detailed discussion of the issues can be found in this Qualified Patients Association v. City of Anaheim case discussion.

Affordable Housing Regulations Survive Another Challenge

July 26, 2010, by Dawn McIntosh

The City of Cotati has defeated the Pacific Legal Foundation ("PLF") in a challenge to the City’s affordable housing regulations and protections for the endangered California Tiger Salamander. (Click link to read the opinion in Mead v. City of Cotati, Ninth Circuit Case No. 09-15005.) In 2008, PLF sued the City and state and federal wildlife agencies on behalf of a housing developer alleging various constitutional claims resulting from two conditions included in the Cotati Planning Commission’s decision to issue a permit for his project – comply with the City’s affordable housing regulations and comply with guidance issued by the wildlife agencies for the protection of the endangered California Tiger Salamander ("CTS"). On PLF’s website they announced that the lawsuit against the City was ground zero in their national campaign to eradicate affordable housing regulations and to change takings law in favor of property owners. On July 22, in an unpublished opinion, the Ninth Circuit affirmed the dismissal of the case by the District Court for failure to state a viable claim and rejected PLF’s entreaties to soften the takings standards for property owners. Not surprisingly, this case no longer appears as the poster child on PLF's website.

Court Finds Statutes Favoring Speech Related To Labor Disputes Unconstitutional

July 28, 2010, by Meyers Nave

Given the California appellate court's recent ruling in Ralphs Grocery Company v. United Food and Commercial Workers Union Local 8 (January 19, 2010) 2010 DJDAR 11199, police departments may now receive increased requests to remove peaceful picketers in labor disputes from private property. While this case may provide authority for police officers to remove such picketers from private property, cities should seek individualized legal advice on this issue when altering current policies and procedures. The California appellate court specifically found that a Ralphs-owned grocery store was a private forum not subject to heightened First Amendment scrutiny, concluding that labor union picketers were trespassing on private property when they violated Ralphs's protest restrictions. In reaching this decision, the appellate court ruled that statutes that protect or favor labor union speech over other forms of speech violated the First and Fourteenth Amendments of the Constitution.

The Court started with a public forum evaluation under Pruneyard and later case law. Even though the Ralphs-owned store is part of a larger shopping center, the entrance and apron were not "designed and presented to the public as public meeting places," nor did these areas "act as the functional equivalent of a traditional public forum." The court found that the setting of the store within a shopping center with a number of other retailers and restaurants, some of which provide outdoor seating, was similar to other appellate court decisions holding that the entrance areas and aprons to stand-alone stores in shopping centers are private fora. Significantly, the court also explained that as a private forum, Ralphs could limit or prohibit certain speech even if they selectively allowed other groups to collect signatures or donations for other causes.

The trial court's refusal to grant injunctive relief was grounded in the Moscone Act (Code of Civil Procedure § 527.3) and Labor Code § 1138.1, which limits a court's ability to grant injunctive relief in cases involving labor disputes. Sacramento police officers were unwilling to remove the peaceful picketers from Ralph's private property presumably because of the Moscone Act and Labor Code § 1138.1. Relying on Supreme Court precedent that found preferential treatment of speech regarding labor disputes to be unconstitutional content-based discrimination under the First and Fourteenth Amendments, the appellate court declared both the Moscone Act and Labor Code § 1138.1 unconstitutional.

This case highlights the fact specific inquiry required to determine whether retailers within a private shopping center qualify as a public forum. The case notably explains that if the forum is private, the private entity may selectively enforce its no solicitation policies. Additionally, and quite significantly, the case holds that parties seeking injunctive or other equitable relief from labor union demonstrations will no longer be required to meet the heightened requirements of the Moscone Act and Labor Code § 1138.1. The impact of this ruling is likely to be that police departments will receive more frequent calls to remove peaceful picketers in labor disputes from private property. Given, however, the many nuances of First Amendment jurisprudence and that this decision is an appellate court decision, (subject to being disagreed with by a different appellate court on the same issue in a different case or subject to being overruled by the California Supreme Court ) police departments would be wise to seek specific legal advice on this issue before changing current policies regarding the removal of peaceful picketers in labor disputes from private property.

Ninth Circuit Clarifies Scope of Owner/Operator Liability Under CERCLA

July 30, 2010, by Meyers Nave

On July 22, 2010, in State of California Department of Toxic Substances Control v. Hearthside Residential Corporation, the Ninth Circuit held that owner liability under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) is measured from the date cleanup costs are incurred rather than the date the lawsuit seeking reimbursement for cleanup costs is filed.

In this case, Hearthside Residential Corporation (Hearthside) purchased an undeveloped tract of wetlands in 1999 that it knew was contaminated with polychlorinated biphenyls (PCBs). Two years later, Hearthside entered into a consent order with the State of California Department of Toxic Substances Control (DTSC) under which it agreed to remediate its property. Hearthside, however, refused to remediate adjacent residential parcels that DTSC believed had been contaminated by the PCBs on Hearthside’s property. As a result, DTSC contracted to clean up the adjacent parcels itself and incurred cleanup costs between July 2002 and October 2003.

Hearthside completed the remediation of its property in December 2005, and then sold it to the California State Lands Commission that same month. In 2006, DTSC filed a lawsuit against Hearthside under CERCLA seeking reimbursement for the cleanup costs DTSC had incurred to remediate the adjacent parcels. DTSC alleged that Hearthside was liable as an “owner” under CERCLA because Hearthside’s former property was the source of the contamination and Hearthside owned the source property at the time DTSC incurred cleanup costs. Hearthside denied liability, arguing that it was not an “owner” under CERCLA because ownership status is determined at the time the lawsuit is filed, and Hearthside was not the owner of the source property at the time DTSC filed its complaint.

CERCLA is silent as to the date from which ownership is measured. Therefore, the Ninth Circuit looked to CERCLA’s statute of limitations and purpose to determine how ownership should be measured . The Ninth Circuit concluded that measuring ownership at the time cleanup costs are incurred is most consistent with CERCLA’s statute of limitations, which accrues from the time a removal action is completed or a remedial action is initiated on a site, and with CERCLA’s purposes of encouraging responsible parties to clean up property quickly and to achieve an early settlement with environmental regulators.

Since 2001, former property owners were deemed responsible parties under CERCLA only if they owned the property at the time the contamination occurred. Now, under the Ninth Circuit’s holding, former property owners may also be responsible parties if they owned the property at the time cleanup costs were incurred.