Will You Lose Your "Purchase Money" Antideficiency Protection If You Refinance Your Home Mortgage? The Answer May Soon Change

By Professor Dan Schechter

Under California law, homeowners who borrow money to buy a house are protected from "deficiency liability" under Cal. Code Civ. Proc. §580b. Unfortunately, that protection is lost when the mortgage is refinanced, since the debt is no longer a "purchase money" obligation. Several years ago, the Insolvency Law Committee of the California State Bar began to work on a legislative proposal to extend purchase money protection to refinancing transactions; as a member of that committee, I have been closely involved in drafting the proposal and in attempting to shepherd it through the legislative process.

Following a long series of discussions among the State Bar, the lending industry and other relevant players, Sen. Ellen Corbett (D-San Leandro) offered to sponsor the bill (now labeled SB 1069). It has been amended during its journey through the Legislature and, as of mid-March, 2012, it is now before the Senate Committee on the Judiciary; although some peripheral issues have been cut from the current draft of the bill, the essence of our original proposal is still intact. Further hearings are expected before the bill comes before the full Senate later this year. If this bill passes in its present form and is signed by the governor, it will apply to transactions occurring after January 1, 2013.

Similar legislation proposed by the California Association of Realtors was passed during the last year of Gov. Schwarzenegger's administration. That proposal would have applied retroactively to all refinancing transactions, regardless of when they were funded. Our committee did not endorse that proposal because we had doubts about its constitutionality; we felt that it could violate the Contracts Clause because it would have altered the rights of parties to existing contracts. The governor's veto message specifically mentioned retroactivity as the reason for his veto of that bill.

Apple Fights for iPad Trademark Rights

By Professor Jeffery Atik

Apple's lawyers woke up last month to discover that its China-based iPad trademark litigation with Proview had spilled over to California's courts. On February 17, Proview sued Apple in state court in Santa Clara county, asserting that Apple had defrauded Proview of its IPAD trademarks registered in Europe and in key Asian markets. The California iPad litigation is not a trademark infringement case (Apple's U.S. rights to the iPad mark are not challenged) -- rather Proview disputes Apple's ownerships of the various foreign IPAD marks registered by Proview. Proview urges that its assignment of these marks to Apple be rescinded, due to what it considers to be Apple's fraud. With that said, the California litigation forms part of the larger conflict between the two firms -- which has occupied courts in Hong Kong and Shenzen, China -- and so reflects Proview's grand strategy to cloud Apple's claims to the iPad marks, either by resort to law or by subjecting Apple to public embarrassment. And here lies a tale of Apple's over-cleverness, in approaching Proview in the guise of IP Application Development Limited, a stealth UK company whose name's initials conveniently spell out "IPAD."

The iPad has developed into one of Apple's most important products, now accounting for 26 percent of Apple's gargantuan sales and defining a new category of computing device. The iPad trademark is thus one of Apple's most valuable assets. And so it seems difficult to recall that leading up to Steve Jobs's January 2010 introduction of the device, there was much fascination -- and much mystery -- as to what it would be called. When Steve asked his fans to welcome a "truly magical and revolutionary product," few could conceive how commonplace the term iPad would shortly become in our everyday vocabularies.

Recent litigation -- starting in China but now clouding Apple's claim to the iPad trademark in other Asian markets and Europe as well -- reveals that Apple took elaborate steps in the five months prior to the January 2010 launch to secure the iPad mark. Apple knew exactly where to look: back in 2005 it had a spat of litigation with a Chinese firm, Proview, over Apple's rights to the iPod trademark. Proview had a product line with a similar name: its IPAD. That dispute ended with a non-disclosed settlement and some lingering bad blood between the firms.

The First Faculty Series Downtown

By Associate Dean Michael Waterstone

We're proud of our new Loyola Law School Downtown Public Interest Law Center at 800 South Figueroa Street in the heart of downtown Los Angeles. The Center houses our Disability Rights Legal Center and the Center for Conflict Resolution. Last week, we hosted the first of our "Loyola Faculty Downtown" series at the Center. Professor Laurie Levenson spoke to an audience of alumni about cutting-edge issues in Criminal Law. We look forward to hosting at least one session a semester for our alumni in the Los Angeles area. If you have any ideas or faculty you would like to hear from, please let me know!

SOFAs (status of forces agreements) in spotlight in wake of Aghan shootings

By Professor David Glazier

The U.S. government's decision to move Staff Sergeant Robert Bales, accused of killing 17 Afghan civilians during an unauthorized nighttime foray, out of Afghanistan raises questions about criminal jurisdiction over American military personnel abroad. While popular Afghan demands for his local trial are understandable, the U.S. military's actions seem consistent with its legal obligations.

Historically military forces abroad enjoyed complete sovereign immunity and were subject to local criminal or civil liability only with the consent of their government. Traditional concepts of sovereign immunity started to break down in the twentieth century, however, and during a time of expansion of permanent overseas bases, nations began negotiating "status of forces agreements" (SOFAs) to clarify legal jurisdiction over their military personnel in foreign territory.

The North Atlantic Treaty Organization (NATO) SOFA, negotiated between the alliance states in 1951, is representative of typical modern treaty provisions. It recognizes exclusive jurisdiction on the part of the parent nation (sending state) for offenses which are service-unique, such as desertion or disobedience of orders, as well as for conduct which is only a crime under the law of the sending state. Conversely, it recognizes exclusive jurisdiction of the host nation (receiving state) over offenses which violate its laws, but not the law of the sending state. There is concurrent jurisdiction over all other offences. The SOFA addresses this overlapping authority by assigning primary jurisdiction to the sending state in cases involving offences against its security, property, or its own nationals; as well as offences arising out of acts "done in the performance of official duty." The receiving state is given the primary right to exercise jurisdiction in all other cases, although it is not uncommon for foreign countries to agree to U.S. military trials even where the SOFA gives them primary jurisdiction.

Coleman and the Perils of New Federalism

By Associate Dean Michael Waterstone

Waterstone is guest blogging this month at PrawfsBlawg, on which this piece first appeared.

The Supreme Court announced its decision today in Coleman v. Court of Appeals of Maryland. For reasons I will explain below, I disagree with the plurality decision and think it is one of a growing trend of harmful and indefensible "new federalism" decisions. Spoiler alert: I think Justice Scalia makes a fine point about this jurisprudence in his concurring opinion.

First, the facts: Plaintiff had sued his state employer for damages, alleging that it violated the "self-care" part of the Family Medical Leave Act (FMLA), which entitles an employee to take up to 12 weeks unpaid leave per year for the employee's own serious health condition. In Nevada v. Hibbs, the Court had upheld the constitutionality of suits for damages against states for FMLA's "family care" provisions, which guarantee unpaid leave for the care of a newborn child, adoption or foster care placement of a child, or care of a spouse, son, daughter, or parent with a serious medical condition. But in Coleman, the Court held that Congress had exceeded its constitutional authority with the "self-care" provision. Accordingly, the state is entitled to Eleventh Amendment immunity and the plaintiff's suit for damages is dismissed on sovereign immunity grounds.

In Coleman, the Court held that unlike the family care provision, the self-care provision failed the apparently now sacrosanct City of Boerne congruence and proportionality standard. Under this standard, the Court will assess the evil or wrong Congress attempted to remedy and the means Congress adopted to address that evil. Legislation enacted under Section 5 of the Fourteenth Amendment must be targeted at conduct transgressing the Fourteenth Amendment's substantive provisions and the Court must find that there is congruence and proportionality between the injury to be prevented or remedied and the means adopted to achieve that end.

Professor Maureen Pacheco to Testify Before the California State Senate

California State Sen. Carol Liu has asked Professor Maureen Pacheco, assistant director of Loyola's Center for Juvenile Law and Policy, to testify before the California State Senate Public Safety Committee on pending bill SB 988, which Pacheco helped draft. The proposed bill specifies that any person younger than 18 years of age who is represented by counsel as a ward of the court is entitled to competent counsel. The bill would require mandatory training for attorneys who represent minors in wardship.

Fast Track Litigation? Rebuttable Presumption in Your Favor? Not Interested...

By Associate Dean Michael Waterstone

Waterstone is guest blogging this month at PrawfsBlawg, on which this piece first appeared.

Here in California, for some time there has been a fairly fierce debate raging between one segment of the plaintiff's bar and the business community relating to disability access litigation. Title III of the Americans with Disabilities Act, a federal law, requires privately owned places of public accommodation (restaurants, movie theaters, bowling alleys, etc.) to be accessible to people with disabilities. The reach of the statute is broad, but the remedies are pretty weak - only injunctions are available. Given the Court's decision in Buckhannon combined with the lack of a damage remedy, often times these are not profitable cases for private attorneys to take, even if they are potentially meritorious.

But under California state law (which offers more protection for people with disabilities than federal law), plaintiffs can get damages for inaccessible privately owned places of public accommodation. Enter a segment of the plaintiff's bar, which brings large number of these cases, often times going after small businesses, and in some instances using questionable demand methods. The business community claims they are being extorted for small "ticky tack" violations which drive their cost of business through the roof (and point to unethical behavior by at least some attorneys/clients who have claimed multiple injuries in multiple places at the same time). Some segments of the disability rights community counter that a violation, no matter how small, can and does have exclusionary and harmful effects on people with disabilities; and that these laws are not new and are not optional. A balanced discussion of the issue can be found here.

In California, one legislative reaction to this situation was SB 1608, which, amongst other things, limited damages and created the California Commission on Disability Access to further study the situation. But I'd like to focus on one other aspect of the SB 1608: it created a program encouraging businesses to hire "certified access specialists" to inspect their businesses for compliance before any litigation. If a business is inspected, they receive an automatic 90-day stay of any lawsuit and may go directly to an early evaluation conference run by the court.

California's Addiction to Direct Democracy Continues

By Associate Clinical Professor Jessica Levinson

Suit up. It is almost time for another election in California. We all know what that means: more ballot initiatives. (Insert sighs, grumbles and other sounds of disappointment here).

In June we will be asked to vote on a proposed cigarette tax. Opponents of the measure -- big tobacco companies, including Philip Morris and R.J. Reynolds Tobacco -- have raised almost $15 million to defeat the measure. But if you're looking for ads from them, it will be much easier for you to look for the committee they have funded, Californians Against Out-of-Control Taxes and Spending. (Note to California legislators, time to improve disclosure and transparency for ballot measure spending).

Proponents of the measure have raised almost $3.2 million. The committee receiving those funds is called Californians for a Cure.

These costly electoral campaigns hardly capture the public's imagination. If anything, they perpetuate the feeling that our government doesn't function well and instead every election we must endure endless battles over the fate of ballot initiatives. For the many who may not differentiate between legislatively-initiated ballot measures and citizen-initiated ballot measures, it just feels like another expensive political campaign.

Here is an idea that will never happen. Let's treat these ballot initiative campaigns like lawsuits. Instead of duking it out and either failing to pass an initiative only to bring it back in the next election, or passing an initiative which will end up being litigated well past the next election, let's try settling. In the case of the cigarette tax, both sides would donate the amount they are prepared to spend supporting or opposing the initiative to the end goal of the initiative. Of course this won't always work (or let's be honest, mostly it won't even be feasible). But in this particular case, this would mean $18 million for cancer research 3 months before the election. There is no doubt that number will rise.

The real solution is a simpler one, but also unlikely to succeed: We should severely limit the initiative process. It is difficult to say that with the importance of cancer research, but in a representative democracy this law should be passed through the legislative process (Why? A third of ballot props are so badly written that they end up in litigation, some initiatives fund particular groups instead of a wide array of industry interests and initiatives further retrain our legislators from easily balancing the budget.) If our representatives are not up to the task, we should toss them out, not try to do their jobs for them, and in the process make their jobs increasingly difficult.

Jessica A. Levinson is a visiting associate clinical professor at Loyola Law School. She studies governance issues, including campaign finance, ethics, ballot initiatives, redistricting, term limits, and state budgets.
[This post also appeared on kcet.org.]

Prof. NeJaime reviews Constitutional Redemption: Political Faith in an Unjust World

In a new essay, Constitutional Change, Courts, and Social Movements, to be published in the Michigan Law Review, Professor Doug NeJaime reviews Jack Balkin's influential new book, Constitutional Redemption: Political Faith in an Unjust World (Harvard University Press 2011). Balkin is the Knight Professor of Constitutional Law at Yale Law School and is one of the most influential constitutional scholars in the country. In the review, NeJaime argues that by situating courts as important actors in the process of constitutional and social change, Balkin's analysis redeems courts in a field - constitutional theory - that has largely turned away from courts as undemocratic, incapable, and inherently conservative. Ultimately, NeJaime takes his work on law and social movements to Balkin's account of constitutional change, arguing that attention to the way in which social movement lawyers deploy court-based tactics suggests that Balkin's account of courts is more realistic than the pessimistic accounts that have dominated constitutional scholarship recently. While Balkin focuses on social movements' relationship to courts, he does not borrow explicitly from the extensive literature on social movements in sociology. Accordingly, NeJaime suggests a research agenda that uses the theoretical frameworks and empirical insights from social movement theory to develop a more dynamic, context-specific, and contingent account of courts in the process of social change. In the end, NeJaime argues, social movement theory would help constitutional scholars specify both the possibilities and limitations of courts and court-centered tactics.

The (In)Decision of Douglas v. ILC: The Relevance of CMS Approval in Challenges to Medicaid Payment Cuts

By Professor Brietta Clark

Recently, the U.S. Supreme Court issued an odd decision in the case of Douglas v. Independent Living Center. Douglas is the consolidation of three suits challenging cuts in California's Medicaid (Medi-Cal) reimbursement for a wide range of health care services. The Ninth Circuit affirmed lower court decisions halting the cuts because they were found to violate a provision of the Medicaid Act that requires rates be sufficient to ensure equal access to quality care. This provision, 42 USC 1396a(a)(30(A), is commonly known as the "Equal Access" or "30A" Requirement. The Supreme Court did not take up the issue of whether the cuts actually violated this requirement.

Read the complete piece on Professor Brietta Clark's Health Care Justice Blog.