DAILY APPELLATE REPORT BRIEFLY

CIVIL LAW

Attorneys: Attorney fees awards are pay-able to litigant and are therefore subject to offset to satisfy litigants’ debts to Govern-ment. Astrue v. Ratliff, U.S. Supreme Court, DAR p. 8875

Civil Procedure: Plaintiff has right to amend complaint where question exists as to choice of law governing foreign company practices. Kruss v. Booth, C.A. 4th/3, DAR p. 8824

Civil Procedure: Landlord must serve notice to address provided by tenant under lease to fi le unlawful detainer suit. Culver Center Partners East #1 L.P. v. Baja Fresh Westlake Village Inc., C.A. 2nd/7, DAR p. 8862

Constitutional Law: School board’s vote to remove member from vice-president position is not retaliatory action in violation of First Amendment. Blair v. Bethel School District, U.S.C.A. 9th, DAR p. 8896

Insurance: Insurer’s umbrella coverage is considered primary coverage, thereby creating duty for insurer to defend against

insured’s lawsuit. Legacy Vulcan Corp. v. Superior Court (Transport Insurance Co.), C.A. 2nd/3, DAR p. 8816

Real Property: Disputed issue of fact exists as to whether company engages in real estate broker business by raising fi nancing for another company. GreenLake Capital LLC v. Bingo Investments LLC, C.A. 2nd/7, DAR p. 8891

Real Property: Quitclaim deed transferring property to trustee in anticipation of trust’s creation is valid although trust did not exist when deed was executed. Luna v. Brownell, C.A. 2nd/3, DAR p. 8811

CRIMINAL LAW

Criminal Law and Procedure: Solicitations of others to donate to candidate in own names violates federal campaign fi nance law prohibiting contribution in name of another. U.S. v. O’Donnell, U.S.C.A. 9th, DAR p. 8903

Criminal Law and Procedure: Trial court has discretion to reopen prosecution’s case so he may establish usable amount of

marijuana. People v. Riley, C.A. 4th/1, DAR p. 8909

Criminal Law and Procedure: Court missing deadline under Mandatory Victims Restitu-tion Act maintains power to order restitution where only amount was left open before deadline expired. Dolan v. United States, U.S. Supreme Court, DAR p. 8853

Criminal Law and Procedure: Death penalty appeal statute of limitations may be subject to equitable tolling where petitioner’s attorney’s conduct is egregiously unprofes-sional. Holland v. Florida, U.S. Supreme Court, DAR p. 8838

Immigration: Simple drug possession not charged as enhanced offense is not ‘aggravated felony’ under Immigration and Nationality Act. Carachuri-Rosendo v. Holder, U.S. Supreme Court, DAR p. 8882

Immigration: California Penal Code convic-tion of making criminal threats is crime of violence for which alien defendant is subject to sentence enhancement. U.S. v. Villavicen-cio-Burruel, U.S.C.A. 9th, DAR p. 8899

Lawyers for screenwriters who won a settlement with the Writers Guild of America West over unpaid foreign levies fi led an opposition Monday to the fees requested by attorneys for three objectors to the settlement. Solo practitioners Jeffrey Winikow and Steve Kaplan became involved in the fi ve-year lawsuit last October to object to a preliminary settlement agreement, later fi ling a fee request for $193,800 after the settlement was fi nalized. The plaintiffs’ lawyers, who are seeking $1.03 million in fees, wrote in their opposition that while the objectors’ attorneys did help improve the settlement, their request is “wholly disproportionate and excessive.”

‘Enter the Law’

Yolo County Superior Court Judge Paul K. Richardson is a fan of the old west who doesn’t shoot from the hip in court. PAGE 2

DIGITAL CHOICE

The Daily Journal is available through the Web in a digital edition, identical to the paper edition. For more information, go to www.dailyjournal.com.

MORE NEWS

By Erwin Chemerinsky

In Berguis v. Thompkins, 2010 DJDAR 8047, the Supreme Court took a major step to lessening the Constitution’s protection against self-incrimination.The Supreme Court held that a criminal suspect’s silence, even for a period of hours, is not enough to invoke the right to remain silent. Even a single word after hours of silence is enough to waive this right.

In Miranda v. Arizona, 384 U.S. 436 (1966), the Su-preme Court described the inherently coercive nature of in-custodial interrogation and held that to lessen this coercion, suspects must be informed of their rights. Even children can recite the famous Miranda

warnings, which include informing a suspect of his or her right to remain silent.

Van Chester Thompkins was arrested by Michigan police on suspicion of having committed murder. He was given his Miranda warnings and asked to sign a statement that he understood them. He refused. There is a factual dispute as to whether he orally indicated his understanding.

Police offi cers questioned Thompkins for two hours and 45 minutes. Thompkins remained almost entirely silent during this time. Occasionally he’d answer a question with a single word or a nod. Almost three hours into the interrogation, the police offi cer asked Thompkins, “Do you believe in God.” Thompkins said, “yes.” The offi cer then asked Thompkins whether he

prays to God and once more he said, “yes.” The offi cer then asked, “Do you pray to God for shooting that boy down.” Thompkins again said, “yes.”

This statement was admitted against Thompkins at trial and was crucial evidence in gaining his convic-tion. The issue before the Supreme Court was whether this violated the privilege against self-incrimination. In a 5-4 decision, the Court ruled against Thompkins and found that there was no infringement of his Fifth Amendment rights. Justice Anthony M. Kennedy wrote for the majority, joined by Chief Justice John G. Roberts Jr. and Justices Antonin Scalia, Clarence Thomas, and Samuel A. Alito Jr.

The Court concluded that a suspect’s silence is not

By Laura ErndeDaily Journal Staff Writer

A federal appeals court reinstated felony charges Monday against prominent Los An-geles trial lawyer Pierce O’Donnell, who is accused of illegally funneling political con-tributions through his law fi rm employees and family members.

O’Donnell allegedly arranged for 13 dif-ferent people to donate a total of $26,000 of his money to John Edwards’ 2004 presiden-tial campaign.

U.S. District Judge S. James Otero threw out the indictment against O’Donnell a year ago, fi nding the law does not explicitly bar a person from fi nancing such “straw donor” contributions and only applies to the person who made the contribution.

But a three-judge panel of the 9th U.S. Circuit Court of Appeals reversed Otero on Monday, saying his interpretation of the law is inconsistent with its purpose.

“It is implausible that Congress, in seek-ing to promote transparency, would have understood the relevant contributor to be the intermediary who merely transmitted the campaign gift,” Circuit Judge Raymond C. Fisher wrote. U.S. v. O’Donnell, 2010 DJDAR 8903.

O’Donnell is considering an appeal to the U.S. Supreme Court.

“We are reviewing today’s decision and considering our next steps,” O’Donnell’s lawyer, George J. Terwilliger III of White & Case in Washington, D.C., said in a pre-pared statement. “One option is to ask the U.S. Supreme Court to reverse the 9th Cir-cuit. We will be looking at that possibility.”

Prosecutors said the ruling is consistent with the way they have been applying the law, which was part of the 1971 Federal Election Campaign Act.

“Since the early 1970s, the statute has been read to prohibit conduit contributions like those charged in this case, and there

have been numerous such prosecutions brought nationwide,” said Assistant U.S. Attorney Michael J. Raphael, chief of the criminal appeals section. “The opinion af-fi rms that long-standing interpretation.”

The Federal Election Commission and nonprofi t groups that favor campaign fi -nance regulations fi led friend-of-the-court briefs in support of the government.

Melanie Sloan, executive director of Citizens for Responsibility and Ethics in Washington, said Monday’s ruling ensures that elections are not bought and sold by the wealthy.

“Mr. O’Donnell’s scheme was a brazen violation of election law and CREW praises the Ninth Circuit for recognizing this fact,” she said.

The American Civil Rights Union, an Al-exandria, Va.-based conservative nonprofi t, backed O’Donnell, arguing that “stretching criminal statutes beyond their plain terms to railroad defendants into prison terms based on policy arguments would violate the basic rule of law and threaten the basic liberty of American citizens, as in authori-tarian regimes.”

At issue was Title 2 U.S. Code Sec. 441f , which says that, “No person shall make a contribution in the name of another per-son.”

O’Donnell argued that means that only the person submitting the donation is liable, and only if they use a fake name.

But the 9th Circuit said the language ap-plies to people who used fake names as well as people like O’Donnell who used interme-diaries to make donations.

If O’Donnell is convicted of a felony, he faces prison time, a fi ne and the loss of his law license.

O’Donnell resolved a state prosecution for similar charges under favorable terms. In 2006, he pleaded no contest in Los Ange-les County Superior Court to misdemeanor charges of making conduit contributions to

Jim Hahn’s successful 2001 mayoral cam-paign. O’Donnell was fi ned $155,200, placed on three years’ probation and banned from political fundraising for three years.

O’Donnell is best known for representing clients such as the late writer Art Buchwald in his successful lawsuit against Paramount Pictures over the 1988 Eddie Murphy fi lm “Coming to America.” O’Donnell also represents Hurricane Katrina victims who won a recent court decision that, if upheld, could hold the U.S. government liable for billions of dollars in damages from the

2005 storm. Last year, O’Donnell had the top plaintiffs

verdict in the state when a jury awarded $300 million in compensatory damages and $50 million in punitive damages to venture capital fi rm Auerbach Acquisition Associ-ates Inc. The fi rm claimed that Nashville entrepreneur Greg Daily reneged on a deal to let it in on the ground fl oor of iPayment, a company that provides Internet credit card transaction processing services.

laura_ernde@dailyjournal.com

Law Prohibits Campaign Donors From Making Contributions Through Conduits, Court Says

Daily Journal

Los Angeles trial lawyer Pierce O’Donnell is accused of illegally funneling political contributions through his law fi rm employees and family members.

High Court To Hear California Prison LawsuitBy Lawrence HurleyDaily Journal Staff Writer

WASHINGTON — Wading into the hotly contested fi ght over California prison over-crowding, the U.S. Supreme Court Monday said it would take up the issue of whether a specially convened court had jurisdiction to order the release of up to 46,000 prisoners.

The principal legal question is whether the three-judge U.S. district court panel could issue a prisoner release order under the 1996 Prison Litigation Reform Act. Schwarzenegger v. Plata, 09-1233.

The act allows for such a ruling only as a last resort if “no other relief” is available. The case was one of four petitions the court decided to hear Monday, including two out of the 9th U.S. Circuit Court of Appeals.

In January, the Supreme Court declined to intervene in the prison case at an earlier stage because the district court had not yet issued its fi nal order, but did not rule out taking up the issue at a later date.

The judges on the panel are Northern District of California judges Thelton E. Henderson and Lawrence K. Karlton and 9th Circuit judge Stephen R. Reinhardt. The case is a direct appeal from the panel, meaning the 9th Circuit was not involved. The justices will also consider the separate question of whether the Supreme Court has jurisdiction to rule on whether the panel

Court Reinstates Felony Charges Against L.A. Lawyer

Gay Marriage Trial Marks End, Or a Beginning? By Laura ErndeDaily Journal Staff Writer

SAN FRANCISCO — As Chief Judge Vaughn Walker wraps up an unusual and historic trial about same-sex marriage Wednesday, some legal minds are asking if this is the end or just the beginning.

“Maybe this is kind of opening people’s eyes to whether the crucible of the trial is a better way to hash out some of these larger disputes,” said constitutional law professor Vik Amar of UC Davis School of Law. “That might be one of the enduring legacies of this case, is that it causes people to not only focus on this issue of same-sex marriage

but what are the value of trials in constitu-tional disputes.”

Initially, the challenge to Proposition 8 — which voters approved in November 2008 defi ning marriage in California as between a man and a woman — focused on the legal arguments that could be made on paper.

But Walker insisted that only a full-blown trial with expert witnesses who could be cross-examined under oath would create the kind of detailed record that would be helpful to the 9th U.S. Circuit Court of Ap-peals and — if it gets to that point — the U.S. Supreme Court.

In Berguis v. Thompkins, the Supreme Court has taken a major step to lessening the Constitution’s protection against self-incrimination, writes Erwin Chemerinksy of UCI Law School.

See Page 4 — HIGH

See Page 7 — SILENCINGSee Page 4 — GAY

GUEST COLUMN

CRIMINAL

President Barack Obama’s war on fraud in the defense industry is gaining momentum, and this won’t be slowing down any time soon, says Thomas Gallagher of Pepper Hamilton. PAGE 6

BOOK EXCERPT

In his new book, Mark Goulston explores the concept of dissonance and how this impacts your connection with others. PAGE 6

PROBATE

Jeffrey Galvin and Laura Brown of Downey Brand say trust and estate disputes involving mental capacity issues are increasing as dementia becomes more prevalent. PAGE 8

www.dailyjournal.com

VOL. 123 NO. 114 TUESDAY, JUNE 15, 2010 © 2010 Daily Journal Corporation. All Rights Reserved

LOS ANGELES

By John A. Taylor Jr. and Jeremy B. Rosen

Almost two decades ago, in Moncharsh v. Heily & Blase, 3 Cal. 4th 1 (1992), the California Supreme Court held that under the California Arbitration Act (CAA), a court is not permitted to vacate an arbitration award based on errors of law by the arbitrator (with certain narrow statutory excep-

tions). That holding was considered virtually inviolable until two years ago, when one member of the Court observed that “it is arguably the case that [in Moncharsh] the [C]ourt went too far in emphasizing arbitral fi nality at the expense of obtaining a just and reasonable result.” Cable Connection Inc. v. DIRECTV Inc., 44 Cal. 4th 1334, 1374 (2008). The majority in Cable Connection found an exception to Moncharsh and held that judicial review of arbitration awards based on legal error is permissible where the arbitration agreement itself provides for such review.

Recently, in Pearson Dental Supplies Inc. v. Superior Court, 48 Cal. 4th 665, 669 (2010), the Supreme Court created yet another exception to Moncharsh, this time permitting judicial review of an arbitration award that would deprive an employee of a hearing on the merits of “an unwaiv-able statutory claim.”

In Pearson Dental, the plaintiff sued his employer, alleging age dis-crimination in violation of California’s Fair Employment and Housing Act (FEHA). Pearson Dental successfully moved to compel arbitration based on an arbitration agreement it had discovered in the plaintiff’s personnel fi le.

Pearson Dental then asked the arbitrator to grant summary judgment based on an arbitration agreement provision requiring any dispute to be submitted to binding arbitration within one year after it arose. The arbitrator granted the motion, but the trial court subsequently vacated the arbitration award, ruling that the arbitrator had made a clear error of law in failing to apply the tolling provisions of California Code of Civil Procedure Section 1281.12.

The Court of Appeal reversed, reinstating the arbitration award. Although agreeing that the arbitrator had misapplied the tolling period provided by Section 1281.12, the court held that the arbitrator’s deci-sion “’is insulated from judicial review’” and that legal error “’is not a proper basis upon which either to deny confi rmation of the arbitration award or to vacate the award.’” The appellate court also rejected the argument that the one-year limitation period in the arbitration agreement was unconscionable.

The California Supreme Court granted review. In his 4-3 majority opin-ion, Justice Carlos R. Moreno quickly dispatched the question whether the arbitrator had committed a clear error of law, fi nding he had misap-plied the tolling provisions of Section 1281.12. The Court then turned to whether that legal error provided a basis for the trial court to vacate the award.

Reexamining Moncharsh, the Supreme Court cited language recogniz-ing “’that there may be some limited and exceptional circumstances justifying judicial review of an arbitrator’s decision’ such as when ‘grant-ing fi nality to an arbitrator’s decision would be inconsistent with the protection of a party’s statutory rights.’” The Court also noted that in a later case, Armendariz v. Foundation Health Psychcare Services Inc., 24 Cal. 4th 83 (2000), involving a FEHA claim, it had held that arbitration agreements in the employment context “‘cannot be made to serve as a vehicle for the waiver of statutory rights created by the FEHA’” and “that a party to such an arbitration agreement must be able to fully vindicate his or her statutory cause of action in the arbitral forum.” To ensure such vindication, Armendariz held that, among other things, there must be a written arbitration decision and judicial review that is suffi cient to ensure the arbitrators have complied with the requirements of the FEHA.

Turning to the facts before it in Pearson Dental, the Supreme Court rejected the argument that “all Armendariz requires is a written arbitral award.” Instead, the Court held that as a result of the arbitrator’s clear legal error, the plaintiff was unable to receive a hearing on the merits of his FEHA claim in any forum,

which “’would be inconsistent with the protection of a party’s statutory rights.’” The Court concluded that where an arbitration award’s legal error deprives an employee of a hearing on the merits of his FEHA claims (or other claims based on unwaivable statutory rights), a trial court may vacate the award on the basis of that legal error.

Interestingly, the Supreme Court had held in Moncharsh that judicial review of arbitration awards for legal error could not be based on the rationale that an arbitrator has exceeded his or her powers within the meaning of Section 1286.2(a)(4) of the Code of Civil Procedure when the legal error appears on the face of the award, since “[i]t is well settled that ‘arbitrators do not exceed their powers merely because they assign an erroneous reason for their decision.’” But at the end of its analysis in Pearson Dental, that is precisely the statutory provision cited by the Court for permitting judicial review of arbitration awards in the FEHA context: “[A]n arbitrator whose legal error has barred an employee subject to a mandatory arbitration agreement from obtaining a hearing on the merits of a claim based on such right has exceeded his or her powers within the meaning of Code of Civil Procedure Section 1286.2, subdivision (a)(4), and the arbitrator’s award may properly be vacated.”

The Supreme Court also held that the language in the arbitration agreement requiring the plaintiff to submit his claims to binding arbitra-tion and limiting resort to an administrative forum did not render the arbitration agreement unconscionable or unenforceable.

Three justices, in a concurring and dissenting opinion authored by Jus-tice Marvin R. Baxter, joined the majority in holding that the arbitration agreement itself was not unconscionable or unenforceable. However, they questioned the remainder of the majority’s decision on a variety of grounds, including that it appears to provide only a one-way street for ju-dicial review of arbitration awards, allowing employees to seek review of adverse arbitration decisions on the basis of legal error, but not allowing any similar exception to Moncharsh’s general rule of non-reviewability as

to arbitration awards that wrongly favor employees.

So what are the implications of Pearson Dental for the arbitration of disputes, particularly in the employment context? First, Pearson Dental makes clear that arbitration agreements can be used by California employers to re-quire employees to submit FEHA (and similar) claims to binding arbitration rather than for adjudication by an administrative entity such as the Labor Commissioner or through a damages action in court.

Second, Pearson Dental refl ects a growing divide be-tween the CAA and the Federal Arbitration Act (FAA). As held in Cable Connection, parties to an arbitration agreement governed by the CAA may provide for judicial review based on legal error in the agreement, whereas the U.S. Supreme Court has reached a contrary conclusion regarding agreements governed by the FAA. See Hall Street Assocs. L.L.C. v. Mattel Inc., 552 U.S. 576 (2008). Parties drafting arbitration agreements will want to think carefully about the advantages and disadvantages of judicial review in determining whether the agreement should be governed by the CAA or the FAA.

Finally, despite Justice Baxter’s pessimism on the subject, employer defendants in future cases should continue to exam-ine whether the principles explored in Armendariz and Pearson Dental provide employers with the same latitude as employ-ees to seek judicial review of adverse arbitration decisions under FEHA. The majority opinion did not directly address this question, and much of the rationale used to justify the holding for an employee could arguably be used in lower courts to support similar arguments for employers. Like-wise, the rationale for affi rming review to protect FEHA claims could be used where other important statutes are implicated, either within or outside the employ-ment context.

Another Exception for Judicial Review of Arbitration Awards

John A. Taylor Jr. is a partner with the civil appellate law fi rm of Horvitz & Levy in Encino.

TUESDAY, JUNE 15, 2010 7Los Angeles

suffi cient to invoke the right to remain silent. Rather the Court said that there must be an “unambiguous” invocation of this right. Earlier, in Davis v. United States, 512 U.S. 452 (1994), the Supreme Court held that an invocation of the right to counsel under Miranda must be done in a clear and unambiguous manner. The Court ruled that the same is true of the right to remain silent.

The Court then found that Thompkins had validly waived his right to remain silent. The Court said that the waiver of this right need not be ex-plicit; that “[a]n implicit waiver of the ‘right to remain silent’ is suffi cient to admit a suspect’s statement into evidence.” The Court thus upheld Thompkins’ conviction.

Justice Sonia Sotomayor wrote a vehement dissent joined by Justices John Paul Stevens, Ruth Bader Ginsburg, and Stephen G. Breyer. She ac-cused the majority of turning Miranda on its head and lamented the irony that silence is not suffi cient to invoke the right to remain silent.

It is impossible to reconcile the Supreme Court’s decision in Berguis v. Thompkins with Miranda v. Arizona. This is yet another example, and there have been many, of the Roberts Court’s lack of concern with prece-dent and stare decisis. In Miranda, the Court said that “[i]f [an] interro-gation continues without the presence of an attorney and a statement is taken, a heavy burden rests on the government to demonstrate that the defendant knowingly and intelligently waived his privilege against self-in-crimination.” But in Thompkins, the Court said that the government need not show a knowing and intelligent waiver in order to fi nd a suspect’s statements admissible.

In Miranda, the Court said: “Whatever the testimony of the authorities as to waiver of rights by an accused, the fact of lengthy interrogation or incommunicado incarceration before a statement is made is strong evi-dence that the accused did not waive his rights. In these circumstances the fact that the individual eventually made a statement is consistent with the conclusion that the compelling infl uence of the interrogation fi nally forced him to do so. It is inconsistent with any notion of a volun-tary relinquishment of the privilege.” Under this analysis, Thompkins’ incriminating statements should have been excluded.

Nor is it consistent with the right to remain silent to hold that silence is insuffi cient and that a defendant must specifi cally say that he or she is invoking the privilege against self-incrimination. Few suspects realisti-

cally will have the knowledge to recite these magic words. After Thomp-kins, police can keep questioning a silent suspect for hours and hours until they fi nally obtain an incriminating answer.

Miranda created a strong presumption that confessions are inadmis-sible if obtained after questioning unless there has been an explicit waiver of the Fifth Amendment privilege against self-incrimination. In sharp contrast, Thompkins creates a strong presumption that confes-sions are admissible if obtained after questioning unless there has been an explicit invocation of the right to remain silent. This really does turn Miranda on its head.

Ultimately, the underlying issue is whether Miranda matters. Miranda was based on great concern about the inherent coercion when suspects are subjected to in-custody police interrogation. The Supreme Court has explained that Miranda refl ects our society’s “preference for an accusa-torial rather than an inquisitorial system of criminal justice” and a “fear that self-incriminating statements will be elicited by inhumane treat-ments and abuses.” It is based on a realization that while the “privilege is sometimes a shelter to the guilty, [it] is often a protection of the innocent.” Withrow v. Williams, 507 U.S. 680 (1983).

In 2000, in Dickerson v. United States, 530 U.S. 428 (2000), the Court, in a 7-2 decision, reaffi rmed Miranda v. Arizona. But the Court’s decision in Berguis v. Thompkins shows the hollowness of that commit-ment. As Justice Sotomayor observed in her dissent, “Today’s decision bodes poorly for the fundamental principles that Miranda protects.”

Silencing Miranda

Erwin Chemerinsky is Dean and Distinguished Professor of Law at the University of California, Irvine, School of Law.

Continued from page 1

Jeremy B. Rosen is a partner with the civil appellate law fi rm of Horvitz & Levy in Encino.