Tuesday, March 13, 2007
Appeals Court Reinstates Lawsuit Over Rock Band’s Breakup
Panel Says Superior Court Judge Misapplied Rule on ‘Conditional’ Settlements
By KENNETH OFGANG, Staff Writer
A Los Angeles Superior Court judge misapplied a court rule in dismissing a suit because the parties could not adequately explain their inability to finalize the settlement in principle that they had previously announced, this district’s Court of Appeal ruled yesterday.
Div. Eight reinstated a suit by guitarist/songwriter Jeff Levitz against his former group, the Los Angeles-based psychedelic rock group The Warlocks. He claims that in 2002, two years after he joined the group, the other members kicked him out of the band and refused to pay what they owed him.
In early May 2005, Levitz’s attorney notified the court that the parties had “agreed in principle to a settlement of this action in its entirety.” Judge Rolf Treu then set an order to show cause hearing for 45 days in the future, in anticipation of a dismissal once the parties finalized the deal.
The hearing was later postponed for 30 days at the parties’ request, with the judge ordering that “no further continuances” be granted and that a dismissal or “detailed declarations” explaining the reasons for any further delay be filed five days before the hearing.
On that deadline date, attorneys for the band filed a declaration explaining that “finer points could not be agreed upon” despite mediation and that the case should be set for trial. Plaintiffs agreed that the matter would have to be tried.
At the hearing, however, Treu found that the declarations were inadequately detailed, and questioned whether “we didn’t reach a settlement after all” constituted good cause to avoid dismissal. Levitz attorney explained that the parties were unable to agreed on payment for future publishing rights.
Treu responded that “[t]he court’s calendar will not be handled in that fashion” and that:
“When the court says ‘detailed declaration’, that’s exactly what the court means. Everything that’s in your declaration is a conclusion.”
The judge dismissed the case under what was Rule 225(c) of the California Rules of Court, now Rule 3.1385(c).
Not ‘Conditional Settlement’
The rule requires that when a case is completely settled, notice of settlement be filed by the plaintiff’s counsel, and that when the settlement is subject to conditions that will not necessarily occur within 45 days, the plaintiff must file a “notice of conditional settlement” specifying the date by which the settlement will become final. If a notice of dismissal is not filed within 45 days of that date, “the court must dismiss the entire case unless good cause is shown why the case should not be dismissed.”
Justice Laurence Rubin of the Court of Appeal said that the agreement between Levitz and the band was not a “conditional settlement,” so the rule did not apply.
“A settlement with open material terms is not a ‘conditional settlement.’ To the contrary, it is not a settlement at all because, like all contracts, it is not binding until the settling parties agree on all its material terms....Indeed, respondents note that no settlement truly existed in this case. A ‘conditional settlement,’ in contrast, involves a complete meeting of the minds but with some portion of it requiring more than 45 days for its performance.”
Nor, Rubin went on to say, was dismissal in this case a proper exercise of the court’s inherent authority over the calendar.
It was uncontradicted, the justice explained, that when the parties attempted to reduce their agreement to writing, they realized that they in fact had no agreement because the plaintiff thought he had rights that the defendants did not intend him to have.
Assuming that the judge was correct in characterizing the declarations, and the subsequent explanations in court, as inadequate, dismissal was still improper, the justice said, it was wrong for the judge to penalize the plaintiff, rather than his lawyers.
If neither party adequately explained the failure to settle, Rubin added, “we do not understand how dismissing appellant’s complaint is a suitable sanction” for the defendants’ violation.
The case is Levitz v. The Warlocks, B186707.
Copyright 2007, Metropolitan News Company