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Residential building requirements are very strict in California. There are numerous laws, definitions and regulations in place to ensure dwellings are safe and free from defects. It is, therefore, no surprise that claims for construction defects are one of the most common disputes that arise in the construction industry. Identifying construction defects can be a challenge, but it is crucial to know what these deficiencies look like in order to understand the legal options in front of you. For instance, in this post, we will look at some examples of actionable defects, which are deficiencies for which a contractor, subcontractor and/or supplier could be held liable. Water-related defects Water intrusion through doors, windows, and roofs; Foundation systems that do not prevent water or vapor from damaging other building components; Faulty drainage systems; Leaking plumbing or sewer systems; Showers or baths that allow water into the flooring or walls. Foundation-related defects Cracked foundations or slabs; Unlevel structures; Structures that do not meet standards for wind load resistance and earthquakes. Defects in other areas Chimneys and fireplaces that present a risk of fire outside the enclosure; Substandard electrical systems; Significantly cracked exterior walls or hardscape. What to do if you suspect a construction defect If you are a contractor, architect or homeowner who has concerns about these and other construction defects, you should consult a construction lawyer. It is one thing to see these problems, but it is another to navigate the complexities of a construction defect case. At Baker & Associates, we have extensive experience and an established network of experts to help our clients identify whether true defects exist, what caused the defects and who is responsible to remediate them, how much it should cost to remediate the defects, and whether insurance exists to cover the expense and how to force the insurance carriers to meaningfully participate in the process. Call us now at 310-904-6724 to discuss any concerns you may have.

In a recent post (read in full here), we discussed proposed Federal legislation that would affect California commercial transportation companies by extending the deadline to comply with an electronic logging device (“ELD”) mandate. The amendment to delay compliance until 2018 was rejected in a House vote last week. In other words, instead of having until September 2018 to comply with the mandate, trucking companies will still be required to do so by December 18, 2017. Unless you are exempt from this mandate, you need to be sure that you understand and comply with the requirements under the ELD mandate. This means that the vehicles in your fleet should be equipped with certified, registered ELD’s. You should have user accounts set up, and your drivers should understand the types of supporting documents they need to keep. If these and the other elements required under the ELD mandate are not in place yet, you need to take swift action so that you meet the December 18 deadline. The ELD mandate was put in place to address concerns that drivers were on the road too long and subjected to harassment or job termination if they took necessary breaks. The mandate is an attempt to make the roads safer for everyone. However, as discussed in our previous post which can be read in full here, compliance will be costly, particular carriers with large fleets. Considering how much money is on the line and the consequences of non-compliance, carriers would be wise to avoid any missteps by consulting an attorney who understands industry regulations and has experience navigating the legal system on behalf of transportation and logistics companies.

Staying competitive in the marketplace typically requires business owners to be aggressive in the creation of new ideas, services, and products. However, unless business owners are just as aggressive when it comes to protecting these things, they could find themselves without the competitive edge they need to be successful. This is especially true for business owners in California, where technology, design, and innovation are at a premium. In order to protect your business and its intellectual property – including images, inventions, literary works, symbols, designs, and names – you will want to take steps to shield it from misuse and unauthorized access from the following three parties. Former employees: When an employee leaves your company, you do not want him or her take confidential information or trade secrets. Prevent this by requesting that employees with access to sensitive information sign confidentiality agreements. Competitors: To prevent other parties, including competitors, from using creative works developed by your company, secure necessary patents, trademarks and/or copyrights. This allows you to not only establish ownership of the work but also to take action against any party who uses it without permission. Trolls and scammers: Conversely, if you are unfairly accused of violating intellectual property rights by someone who launches baseless lawsuits for monetary gain, then you could be the target of a scammer or patent troll. In these situations, it is crucial to consult an attorney to advise you and protect your rights. Each of these parties has the potential to cause great damage to your business and future success. To prevent this from happening, or to take action if it has already happened, discuss intellectual property protection laws in California with a reputable attorney.

In some cases, these factors cannot legally be used as a reason to hire or not hire someone; in other cases, they can. For instance, as discussed in this article, hiring a person because he or she is attractive falls into something of a legal gray area. When hiring good-looking employees may be lawful Certain industries recognize appearance standards, especially in the entertainment industry here in California. Fashion, TV, film, advertising and similar industries often consider attractiveness as much of a qualification for a job as anything else when it is necessary for the role. In theory, it makes sense that a person can be hired based on physical attractiveness. When hiring good-looking employees may be unlawful This issue can get more complicated when putting it into practice. This is because an employer’s opinion of attractiveness could be discriminatory. Hiring someone based on their skin color, body type, age, gender or other elements of attraction can quickly cross the line into race, disability, age or gender discrimination. Talk to an attorney to know the difference Hiring and firing decisions can come under scrutiny when they are unpopular, unusual or seemingly unfair, which can lead to administrative agency complaints and lawsuits. Because of this, it can be critical for employers to consult an attorney experienced in counseling both small and large businesses in employment matters prior to making any potentially controversial or even illegal employment decisions – especially in California where workers’ rights are particularly protected and the damages and penalties to California employers can be extreme.

California trucking companies are wrestling with the impending “electronic logging device” mandate. On Dec. 18, 2017, compliance with the ELD mandate will be required for all truck driving companies, and for carriers with large fleets compliance will be prohibitively expensive. The Federal Motor Carrier Motor Safety Administration (“FMCSA”) issued this mandate in 2015. The devices are intended to electronically log the hours that the trucks are driven to prevent drivers from falsifying their logbooks. The FMCSA says that this will reduce accidents by keeping fatigued drivers off the road, and claims this will save the industry $1.6 billion per year in record-keeping costs. Trucking companies have argued that the mandate will severely increase the costs of compliance. The devices are estimated to cost between $199 and $2,200 per truck, plus monthly service fees of $20 to $60 per truck. For large carriers that have 10,000 trucks, for example, the cost will be in the tens of millions of dollars. Even independent operators are arguing against the mandate because they are unable to receive financing for the devices and already operate with thin profit margins. National carriers with large fleets may face annual compliance costs ranging from $2.4 million to $7.2 million not counting the initial installation cost of the devices in each truck. Companies might benefit by getting advice from business litigation lawyers about regulatory compliance issues. Attorneys might help their clients with understanding how to comply with the requirements, and they might litigate issues on their behalf in court. If the companies are cited for violating regulatory requirements, the attorneys may defend them in court and before regulatory agencies. The ELD mandate is likely to be a big headache for carriers nationwide, and experienced lawyers may help their clients with making smoother transitions with the installation of the devices.

Members of the construction industry are held to a high-standard of care when working on a project. This is true whether they are constructing a new project or remodeling an old one. These standards may cause the general contractor, subcontractors, architects, engineers, suppliers and the developer to be the subject of a construction defect claim. A construction defect lawsuit can carry severe damages, cause issues with the Contractors State License Board and your bonding company, and may even jeopardize your professional license. When faced with construction defect allegations, construction professionals need to take immediate action to protect themselves. Construction defect disputes can arise for a number of different reasons. Some common defect allegations that may lead to litigation include: Water intrusion Lack of structural integrity Mechanical and electrical issues If you’re facing allegations of a construction defect, there are several options that can be used to resolve the dispute. These dispute resolution solutions may occur within or outside of a courtroom. Mediation Resolving construction defect disputes can be a time-consuming process. One procedure that can accelerate the dispute resolution process is mediation. Mediation allows both parties to talk directly with each other. A mediator is present to facilitate the conversation and help both sides find areas of common ground. Arbitration Some contracts may specify that disputes need to be resolved via arbitration. Arbitration functions similarly to a court of law. An arbitrator will hear arguments and review evidence presented from both parties. The arbitrator will then render a decision. This decision is typically final and usually cannot be appealed. Litigation It is usually preferable to have a defect dispute settled out of court, but that is not always an option. If the dispute needs to be litigated, it is important to work with a lawyer who understands the contract and each party’s role in the agreement, as well as the law that applies. No matter how diligently contractors and developers work, there’s always the potential of a looming construction defect lawsuit. Taking the right approach to resolving a dispute can help professionals in the construction industry achieve a more favorable outcome.

Here at Baker & Associates in Beverly Hills, we represent construction-industry clients like contractors and developers in a wide range of business issues, including construction contracts. Construction contracts are extremely complex with provisions about project specifications, deliverable dates, delays, insurance, materials, financing and more. In addition, we draft and review construction contracts for compliance with applicable state and federal laws, and to insure our clients are maximally protected. Contract drafting We negotiate and draft tight construction contracts to protect our clients from future disputes. However, an unforeseen event may lead to a breach of contract allegation. For a construction-industry client, we help negotiate settlement of such a dispute, but if we cannot reach reasonable agreement, we will either file a breach of contract lawsuit or vigorously defend one in court. Pending lawsuit A recent San Francisco lawsuit illustrates the kinds of issues that can arise in a construction project. In Alten Construction Inc. v. Fast Wrap Reno One LLC, a California contractor sued a Nevada subcontractor that had been contracted to provide a “weatherproof containment barrier” over a building to protect the construction site from the elements during the contractor’s high school modernization construction project. The amended complaint alleges the subcontractor improperly installed the barrier and as a result the building was damaged by water during storms, requiring the contractor to provide additional repairs and maintenance. The plaintiff also alleged the defendant did not defend or indemnify the contractor or provide required insurance. Legal claims The contractor brought multiple causes of action, seeking damages to cover money it had paid because of the allegedly faulty cover: Breach of contract Breach of express and implied warranty Express and equitable indemnity Negligence Misrepresentation, intentional or negligent Contribution to liabilities incurred by plaintiff from the damage Declaratory relief for a statement of rights and obligations from the court Disgorgement of payments for violation of consumer protection law requiring proper contractor licensing Attorney’s fees This is an example of the many and complicated kinds of legal issues that can arise in a construction project. Contractors, subcontractors, architects, designers, developers and others in the industry should develop a relationship with legal counsel who can help protect you with fair contracts, skillfully resolve disputes and aggressively fight for your rights or defend against claims in court or arbitration when necessary.

Californians are no strangers to wine. Whether you drink it or not, you know wine is a massive industry that continues to grow. This growth may satiate wine lovers across the U.S. who thirst for more options, but it creates a problem for wineries who are finding it tougher and tougher to distinguish themselves in the marketplace. This is especially evident when it comes to the naming and labeling of wines. This is illustrated by a current case involving Bogle Vineyards and Next Wine LLC, — competing California wine makers who are locked in a dispute regarding use of the word “essential” on their labels. Although Bogle had been branding their wines for many years with the phrase “Essential Red” wine, they never applied for or obtained a trademark for the phrase. In 2013, Next Wine secured a trademark on the phrase “My Essential Red.” Shortly after, Bogle applied for a trademark on “Essential Red” wine, but the U.S. Patent and Trademark Office denied the request citing a likelihood of confusion. Although the labels look nothing alike, and the use and location of the “essential” element are very different between the brands, the parties attempted to work out an agreement that allowed them to coexist. Reaching an agreement was problematic, though, as Bogle demanded that Next Wine secure preapproval from Bogle regarding any future label designs. Considering that Next Wine holds the trademark and is in a much stronger legal and bargaining position, it is not surprising it turned down Bogle’s demand. Next Wine filed a lawsuit against Bogle calling its behavior, among other things, bullying, so they’re battling it out in court. Despite being in the early stages of litigation, the case is instructive that securing a trademark as early as practicable to protect intellectual property is important, especially in rapidly growing industries; otherwise, like a bad bottle of wine you may be left with a bitter taste in your mouth. Any business owner or executive with questions or concerns about trademarks or other means of protecting your company’s intellectual property would be wise to seek legal counsel to consider your options. There can be a lot on the line in these cases, from money to your company’s branding which may determine the success of your business.

When you hire a new employee, you have them sign a non-compete agreement to protect your company’s trade secrets from competitors. But one of your former employees just resigned and started immediately working for your leading competitor. What legal action can you take against your past-employee for breaking their agreement? Recommended legal advisement California’s business laws are complex, and misunderstanding the laws can greatly compromise your business. Before you make any decisions based on legal principles, contact an attorney who can inform you of your rights and ensure that you are acting within the law. California and non-compete agreements Along with a handful of other states, California does not enforce non-compete agreements. You cannot lawfully prevent your employees from working any job after they leave your employment. Even if your company is headquartered in a state that recognizes non-compete agreements, you cannot enforce agreements with your California employees. This may seem incredibly unfair. After all, you trained your employees in the industry, and shared company secrets with them. But California is protecting the employee’s best interest, not yours. They want to keep California residents gainfully employed. Unfortunately, this allows your employees to learn all they can from you and immediately turn to your competitors, or start a competing business of their own. Significant exemptions California’s non-compete ban applies to almost all situations, but there are a few notable exceptions: 1) The non-compete ban does not extend to current employees. You are able to prevent current employees from taking a second job within the industry or with a competitor. 2) Once a business owner sells his ownership to a new owner, they cannot compete with the business in a way that would harm its value. 3) Business partners and members of a LLC can mutually agree that they will not compete after they leave their business. Remember, California’s courts will almost always side with past employees in regards to non-compete agreements. Speak with your attorney to learn your rights as an employer, and work with them to determine the best ways to protect your company’s property and privacy.