$90,000 Lesson Regarding Rejecting Offers

Aleksei Sviridov learned a harsh lesson after rejecting offers from the defendant in his lawsuit. Aleksei sued his former employer, the City of San Diego and the San Diego Police Department, for discrimination and other claims. Defendants made several CCP Section 998 offers, which Aleksei rejected. When Aleksei lost his claims on summary judgment, the defendants asked the court to award their costs. The trial and appellate courts award defendants over $90,000.00 in costs.

Normally, in a discrimination case, the employee is only responsible for the employer’s costs and fees if the claims are frivolous. The same rule applies to claims under the Public Safety Officers Procedural Bill of Rights Act. There was no finding that Aleksei’s claims were frivolous. So how come the court awarded defendants $90,000? Here’s the lesson regarding rejecting offers.

Lesson Regarding Rejecting Offers

CCP Section 998 is a cost-shifting statute. Used wisely, it can require the plaintiff to pay the defendant’s costs if the plaintiff fails to obtain a more favorable judgment. Section 998 encourages settlement by forcing parties to seriously consider reasonable offers.

A plaintiff who refuses a reasonable pretrial settlement offer and subsequently fails to obtain a “more favorable judgment” is penalized by a loss of prevailing party costs and an award of costs in the defendant’s favor.’ ” (Guerrero v. Rodan Termite Control, Inc. (2008) 163 Cal.App.4th 1435, 1440.)

Rejecting offers after a 998 offer can be quite costly. Just ask Aleksei.

When California’s discrimination laws adopted the “frivolous” standard for awarding the employer’s costs, many assumed employees would not have to worry about excessive fees or costs. Under Sviridov v. City of San Diego, section 998 offers trump the FEHA statute. This is definitely a situation where bad cases make bad law. Apparently Aleksei did not respond substantively to the City’s argument that FEHA does not trump section 998.

Rather, he asserted, with no analysis or citation to legal authority, “just as [Williams, supra, 61 Cal.4th 97], precludes a prevailing defendant from recovering costs under section 1032, subd[ivision] (b),” then “so does Williams preclude a … successful defendant from recovering as a prevailing party under … section 998.” We deem the failure to support this statement with reasoned argument a forfeiture.

In other words, Aleksei provided no authority or substantive analysis upon which the court could rule in Aleksei’s favor. This not only hurt Aleksei’s case, it also made it more difficult for future employees.

I expect we’ll see more 998 offers in discrimination cases, and plaintiffs will once again need to carefully consider whether they can do better than the offer before rejecting offers out of hand.

Original article by Robert E. Nuddleman of Nuddleman Law Firm, P.C.

Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law. We cannot answer questions about specific situations or provide legal advice over the Internet. If you desire legal advice, you should contact an attorney.

Using this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. Using the Internet or this blog to communicate with the firm does not establish an attorney-client relationship. Do not post confidential or time-sensitive information in this blog. The Nuddleman Law Firm, P.C. cannot guarantee the confidentiality of anything posted to this blog.

The Nuddleman Law Firm, P.C. represents employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Pleasanton, Oakland, San Ramon, Hayward, Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.

New San Francisco Employment Laws

San Francisco tends to be on the forefront of passing new employment laws to protect San Francisco workers. The following are two new San Francisco Employment Laws that companies and workers in San Francisco need to consider.

New San Francisco Employment Laws No. 1:

Mayor Lee signed the “Lactation in the Workplace Ordinance” on July 30, 2017.  This “first of its kind in the country” ordinance establishes new standards to ensure employers accommodate lactation.

The ordinance amends the Police Code to require employers to provide employees lactation breaks and a location for lactation. Employers must have a policy regarding lactation in the workplace that specifies a process “by which an employee will make a request for accommodation.” The ordinance defines minimum standards for lactation accommodation spaces and requires that tenant improvements or renovated in buildings designated for certain uses include lactation rooms. The ordinance also outlines lactation accommodation best practices.

The ordinance becomes operative on January 1, 2018. 

You can review the full ordinance here.

New San Francisco Employment Laws No. 2:

On July 14, 2017, Mayor Lee signed the “Employer Consideration of Applicant’s Salary History Ordinance,” also known as the “Consideration of Salary History Ordinance“.  This ordinance (which also becomes operative on July 1, 2018, applies to employers in San Francisco and to the City and County of San Francisco’s contractors and subcontractors. The intention is to “ensure that an individual’s prior earnings, which may reflect widespread, longstanding, gender-based wage disparities in the labor market, do not continue to weigh down a woman’s salary throughout her career.”

The ordinance amends the Police and Administrative Codes and ban employers from considering current or past salary of an applicant in determining whether to hire an applicant or what salary to offer the applicant. The ordinance prohibits employers from asking applicants about their current or past salary. Employers cannot disclose employee salary history without that authorization (unless the salary history is publicly available).

You can review the full ordinance here.

You can review some of my prior articles about some of the San Francisco Employment Laws passed over the years:

Original article by Robert E. Nuddleman of Nuddleman Law Firm, P.C.

Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law, but we cannot answer questions about specific situations or provide legal advice. If you desire legal advice, you should contact an attorney.

Your use of this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. The use of the Internet or this blog for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be posted in this blog and Nuddleman Law Firm, P.C. cannot guarantee the confidentiality of anything posted to this blog.

The Nuddleman Law Firm, P.C. represents employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Pleasanton, Oakland, San Ramon, Hayward, Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.