Posts from June 2023.
Ninth Circuit Clarifies Standard for “Client Employer” Liability

On June 1, 2023, a panel of judges for the United States Court of Appeals for the Ninth Circuit held that berry distributors were not liable as “client-employers” of agricultural workers. The plaintiff agricultural workers had been hired by strawberry growers to pick fruit that was then turned over to defendants Red Blossom Sales, Inc. and Better Produce, Inc. for distribution.

In 2018, the strawberry growers stopped paying the plaintiff agricultural workers and filed for bankruptcy. The plaintiffs then sued the distributor defendants as joint employers and client ...

Posted in Legal Bites
Ninth Circuit Deals Another Blow to Restaurants in COVID-19 Insurance Coverage Case

On June 26, 2023, a panel of judges for the United States Court of Appeals for the Ninth Circuit affirmed an insurance company’s win over a restaurant group seeking insurance coverage for pandemic-related claims in Team 44 Restaurants, LLC v. American Insurance Company, No. 22-15403.

Plaintiffs owned various individual restaurants, who sought insurance coverage under business insurance policies. The defendant insurance companies denied coverage for COVID-19 losses under government shutdowns, on the basis that there was no direct physical loss to the restaurants.

The ...

Posted in Legal Bites
USDA to Increase Substantiation Requirements for Animal-Raising Claims

On June 14, 2023, the U.S. Department of Agriculture (“USDA”) announced that it was implementing a multi-step effort to strengthen the substantiation of animal-raising claims. Animal-raising claims are voluntary marketing claims that highlight aspects of how the source animals used for meat and poultry are raised. These claims include “grass-fed,” “free-range,” or “raised without antibiotics.”

Currently, these claims must be approved by USDA’s Food Safety and Inspection Service (“FSIS”) before they can be included on labels sold to consumers.  ...

Insurance Coverage for Email Scams

A genuine looking email is sent to a company’s accounts payable department with instructions from its president to pay money to a certain account. The “To” and “From” headers and the signature block look identical to hundreds of emails previously received by the department from the company’s president. In reliance on the email, money is wired to the designated account. It later turns out the email was fake and the company’s money was wired to a fraudster’s account.

In another scenario, the company’s accounts payable department receives an email purportedly from a ...

Can a Receiver Be Liable for Failure to Turnover Property When a Bankruptcy Is Filed?

Q: I was appointed receiver for some major assets owned by a corporation. I just learned the corporation has filed bankruptcy. I know I have to eventually turnover the assets I have. Can I wait to see if the bankruptcy sticks or if a trustee is appointed? Can I demand the corporation pay for the cost of my turning over the assets?

A: No and no (although you may have a claim for the cost). As most receivers know, if a bankruptcy is filed that involves an entity or assets in receivership, the receiver must turnover any property of the debtor in the receiver’s possession to the debtor or, if one is ...

Employer Alert: Local Minimum Wage Increases on July 1, 2023

On July 1, 2023, a number of local municipalities and the County of Los Angeles will be raising their hourly minimum wage, based on changes to the consumer price index, and as required by local minimum wage ordinances. Beginning July 1, 2023, the following increases will apply to employers in the designated areas:

In addition, on July 1, 2023, all businesses in the City of West Hollywood, including smaller businesses and hotel employers, will be required to raise the hourly minimum wage to $19.08.  In the past several years, the City of West Hollywood’s minimum wage and corresponding ...


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