Have you recently received a Sacramento Municipal Utility District (“SMUD”) bill for substantially more than you usually owe? If SMUD is alleging that you owe them many thousands of dollars out of the blue, this may be the beginning of a serious legal matter.

I have seen clients with SMUD bills in excess of $100,000 without any explanation. In these cases, we ultimately discovered that SMUD was alleging that the customer was stealing power from SMUD. Not only does this result in a massive electricity bill, but criminal charges can be brought against the customer as well.

Believe it or not, power theft is a prevalent issue nation-wide. According to industry research, it is estimated that up to $6 billion of electricity is pirated in the US every year.

What to do if you receive a massive SMUD bill

If SMUD is alleging you are guilty of power theft, they will send you a bill for the amount of power they believe was misappropriated. Many times this is the first notice that a SMUD customer receives that they are under investigation for power theft.

You need to keep this in mind: the initial bill that SMUD provides is just an estimate. SMUD doesn’t actually know how much power is used by a particular location unless the electricity meter tells them.

Instead, SMUD assesses what was plugged in, how long service was on, and other factors that are difficult to measure. Again, these numbers are just estimates.

Because of this, the estimates are often materially incorrect. Another problem is that SMUD does not differentiate between actual power theft and technical problems with power service. SMUD leaves it up to the customer to prove their innocence.

The Problem with SMUD Power Theft Allegations

SMUD will often target people who are not actually responsible for power theft. SMUD will go after anyone they can, including folkds that are merely associated with the SMUD account or the property.

In all cases we’ve seen, the individual who is being targeted is completely unaware of any wrongdoing on their property, nor were they responsible for the power theft.

However, there are laws and court cases that hold that account holders and property owners can still be on the hook for power theft even if they weren’t personally responsible.

If you believe that SMUD is accusing you of illegally accessing power, contact an attorney immediately. These allegations are serious, and may be grounds to commence a criminal investigation. SMUD also has the ability to seek treble damages for power theft, meaning that SMUD will file a lawsuit seeking triple the amount of the alleged power theft.

Labor Code section 1198.5 is an important law that Plaintiff’s attorneys often use prior to a lawsuit. In most cases, an employer receiving one of these demand letters is going to be soon on the receiving end of a lawsuit. Read on for more information.

What is a Labor Code 1198.5 Inspection Demand?

Labor Code section 1198.5 starts off in a manner that is completely easy to understand:

(a) Every current and former employee, or his or her representative, has the right to inspect and receive a copy of the personnel records that the employer maintains relating to the employee’s performance or to any grievance concerning the employee.

With a few exceptions, employees have an absolute right to inspect and receive a copy of anything in their personnel file.

How Long Must I Maintain Personnel Records?

Section 1198.5(c) provides that:

(1) With regard to all employees, maintain a copy of each employee’s personnel records for a period of not less than three years after termination of employment.

The answer is three years… from the date after termination of employment.

As an aside, I could write a whole book about record keeping requirements under the Labor Code. For example, Section 1174 requires an employer to maintain payroll records for three years (from the payroll period).

Deadline to Respond

Section 1198.5 requires compliance with an inspection demand within 30 calendar days from the date the employer “receives a written request.”

Thus, you should take care to note the date upon which you received the 1198.5 demand. Don’t just work off of the date that appears on the letter itself.

If you are responding without the assistance of an attorney, you may want to send your response via certified mail or UPS. This will allow you to establish a paper trial should the Plaintiff allege that you failed to respond.

Penalty for Non-Response

Don’t want to respond to the former employee’s inspection demand? Do so at your own peril.

The penalty for non-response are a few: a $750 civil penalty; a civil injunction ordering compliance; and of course attorney’s fees to the plaintiff that must bring a lawsuit to enforce the law.

Violating this law can also result in criminal prosecution!


A 1198.5 inspection demand needs to be taken very seriously. Please call my office at (916) 333-2222 if you have received a 1198.5 demand and need help responding.

Let’s face it — not all business transactions turn out the way the parties originally intended. Most disputes can be resolved amicably by thoughtful communication and deliberation. However, some disputes just can’t be solved amongst the parties. This is where the courts step in.

The state and federal courts are where many business issues end up being resolved. The power of the courts can be wielded by an aggrieved party to obtain justice against a wrongdoer. On the other hand, not all entities that file lawsuits have the best of intentions.

A lawsuit is started by filing a “complaint” with the court. The complaint contains general allegations about the alleged wrongs the plaintiff has suffered. Complaints don’t need to be very specific, but they are required to contain certain elements. A defendant can object to a legally deficient complaint, which sometimes results in the lawsuit being tossed out of court.

Once the complaint is accepted by the court, the court will issue a “summons.” A summons is a legal document signed and stamped by the court itself. The summons informs the defendants of the pending lawsuit and provides general directions on their time to respond. A defendant that ignores a summons will risk the court taking their “default.” This means that the defendant automatically loses the lawsuit because they failed to participate.

A defendant has a certain amount of time to file an “answer” to the complaint. The answer is a formal legal pleading that admits or denies the allegations contained in the complaint. As stated above, it is very important to file the answer by the deadline contained in the summons.

Once the defendant has appeared in court to file the answer, the parties begin the “discovery” process. Discovery is where both sides to a lawsuit trade information and documents about their respective cases. The law requires frank disclosure of information, both good and bad. This process is intended to show the parties the relative strengths and weaknesses of their cases. Discovery is an important litigation tool that can make or break a case. It is also one of the most time-consuming and expensive aspects of litigation.

The courts generally aren’t invovled much in the discovery process — unless there is a dispute over the discovery rules that needs to be resolved by the court. During this process, most California courts will require the parties to pick a trial date and set deadlines for the case.

In some cases, it may be appropriate for one or both sides to file a “motion for summary judgement.” This is document that allows the court to rule on the merits of all or part of the lawsuit without the need for a formal trial. Some lawyers refer to this as a “paper trial” because there are no witnesses — just legal pleadings and documents being presented to the court. Motions for summary judgement are not appropriate in every case, but used appropriately, they can save significant amounts of resources that would otherwise be used for trial.

If settlement negotiations aren’t successful and the case isn’t resolved by motion work, the parties will ultimately bring their dispute to a formal trial before the court. Some lawsuits are presented to a jury, while some are “bench trials” where only the judge determines the outcome. In either case, trial preparation and trial itself are incredibly intense endeavors that require a great amount of preparation. A strong case can be easily lost by the lack of adequate preparation.


This is just a brief overview of a typical civil lawsuit in Sacramento. If you are contemplating filing a lawsuit, or have been served with a summons and complaint, please contact my office at (916) 333-2222.

Has someone broken a promise that was made to you? That’s another way of saying that someone has breached their contractural obligations. If the broken promise is serious enough, you can sue the other side for damages. This is called “breach of contract.”

Contracts are essentially lists of mutual promises. Enforceable contracts can be made orally, or more typically, in writing. Written contracts are easier to litigate because the terms are easier to prove to the court. The terms of an oral contract are often a matter of “he said, she said.” Nonetheless, lawsuits over oral agreements can be just as successful as litigation over written contracts.

There can be substantial harm if a promise is broken. This what we can “damages” in the legal profession. If the damages are large enough and the other side is not willing to make things right, an aggrieved party can file a lawsuit to seek the recovery of their damages.

There are several important things to consider before a person makes a decision to file a breach of contract lawsuit.

Timing

A breach of contract lawsuit must be filed with the court within a certain amount of time after the breach occurred. Waiting too long means that you lose your rights to seek damages in court.

Damages

A litigant pursuing a breach of contract lawsuit must prove his or her damages to the court. A litigant just doesn’t get to make up a number. I often deal with potential clients that have clearly been wronged by a breach of contract, but have a difficult time proving their specific damages. If you are going to go through the expensive process of litigation, it makes sense to nail down your recoverable damages before filing the lawsuit.

The Defendant

Does the defendant or defendants have assets or insurance coverage? If they don’t, you might be chasing an empty judgement. The ultimate goal in litigation isn’t necessarily to be deemed in the “right,” but to obtain a recovery of money to compensate you for your damages. Chasing a broke defendant for years can be disastrous in the end.

Plaintiff’s Actions

Not everybody involved in litigation is squeaky-clean themselves. Did you do something that may have excused the other side’s performance of their contractual obligations? You can bet that the defendant to a contract lawsuit is going to drag the you through the mud to try to excuse their own actions. This isn’t always successful, but it is important that you are candid with your attorney regarding your own actions to get ahead of any potential issues.


My law practice accepts breach of contract cases for defendants and select plaintiff’s cases. Please contact me directly at (916) 333-2222 to discuss your specific contract legal issues.

I’ve written recently about judgement liens and on how to collect on civil judgements. But what happens if the person that owes you money declares bankruptcy?

I know quite a lot about this because a large part of my legal practice is based around consumer and small business bankruptcy. One of the top reasons an individual declares bankruptcy is because of aggressive collection activity related to a civil judgement. As a judgement creditor, you have to consider this reality when pursuing an individual or business for money owed. If you’re too aggressive, your debt might end up in bankruptcy. If you’re not aggressive enough, you might miss out on an opportunity to collect the money that you are owed. It really is a fine line.

If a consumer or business ends up declaring bankruptcy and you have collection activity pending against that person or business, you must do one thing immediately: stop everything! Bankruptcy law strongly protects a debtor that has declared bankruptcy. Flouting these protections can result in steep penalties from the bankruptcy court.

With that being said, the bankruptcy code was actually written from the standpoint of protecting creditor rights. The bankruptcy code is intended to provide for the orderly liquidation or reorganization of a debtor’s financial affairs, and the court is empowered to ensure that all creditors are treated equally.

Once you receive notice of your debtor’s bankruptcy case, you should carefully consider your next move. Next steps will depend on whether the debtor has filed under Chapter 7, 11 or 13 of the bankruptcy code. Another consideration is whether a Chapter 7 bankruptcy has been declared an “asset case” by the court.

If your judgement is sizable and you end up in bankruptcy court, I strongly recommend that you retain the services of an attorney. An experienced bankruptcy attorney can help you navigate the complex world of bankruptcy and can advise you whether it makes financial sense to intervene in a bankruptcy case (often times the answer is no, but there are many exceptions).


Need help with collecting a judgement / legal debt in the Sacramento area? Please call my office at (916) 333-2222.

Congratulations! You have obtained a civil judgement in California. How exactly do you get your money? This is a common question that clients ask me. Here are some tips.

1. Obtaining the judgement is just the first step

Money judgements are just pieces of paper. For the most part, the court system leaves it up to you to actually collect on the debt that you are owed. Not all debtors, whether individuals or businesses, will voluntarily make good on their debt.

Inaction on your behalf can impact your rights down the road, so I strongly recommend you act aggressively to collect on your judgement as soon as it issued by the court.

2. Judgements are good for 10 years in California

In most cases, your judgement for money damages will only be valid for ten years in California. This means that you need to collect on your judgement in that timeframe.

California law does allow you to renew your judgement prior to the 10-year expiration. Failure to renew the judgement means that it is forever void. Therefore, the first thing you should do when you win a judgement is calendar your 10-year deadline so that you don’t forget about it.

Isn’t ten years a long time? Yes, but you never know when a debtor may come into assets, purchase a home, or increase their salary.

3. You have various tools to collect on your judgement

If your judgement debtor won’t voluntarily make good on their debt, you have some tools to collect on your judgement.

Wage garnishments, bank levies, property liens and till taps are some of the common collection tools that you can utilize as a judgement creditor. Each collection tool is best suited for a particular type of judgement debtor and in most cases you will need to know some basic information about the debtor in order to proceed.

4. A debtor’s examination might be necessary

If you want to garnish wages, you need to know where the debtor works. If you want to levy bank accounts, you need to know where the debtor banks. You might not know these details about the debtor, or the debtor may be taking steps to make collection difficult. A debtor’s examination will help.

A debtor’s examination is a court-ordered examination where you will be given the opportunity to ask the debtor questions about his or her financial affairs. The debtor must answer your questions under oath and under penalty of perjury. You can also subpoena certain financial documents from the debtor.

Proceeding with collection will likely be much easier once you have asked the right questions and obtained the appropriate paperwork directly from the person or entity that owes you money.

What if the debtor doesn’t appear at the examination? The court can issue a bench warrant for the debtor’s arrest. As you can see, the debtor’s examination is a very powerful tool.

5. An attorney might be a good alternative

Chasing a debtor around and around can be tiring and expensive if not done correctly. Some judgement creditors seek out the assistance of an experienced attorney to help speed the process along. Some attorneys will charge a flat rate or some may help collect your debt on a contingency (where the attorney takes a percentage of funds recovered on your behalf).


Are you having trouble collection on a money judgement in California? Please call my office at (916) 333-2222 to discuss how I can assist you collect the money that you are owed.

Civil lawsuits in Sacramento can take years from start to finish. On the other hand, a default judgement (where the defendant doesn’t appear to defend the action) can occur in just a few months. In either case, a prevailing party in a lawsuit is granted a judgement.

What next?

Judgements are just paper

After winning a lawsuit, you must actually collect on your judgement. While a judgement is an order that says that the defendant owes you money, many defendants don’t voluntarily make good on their debt. That leaves the prevailing plaintiff to pursue collection efforts.

One strong tool that a judgement creditor can take advantage of is a “judgement lien.” Any judgement creditor can record their abstract of judgement with the county recorder. This acts as a lien against all real property owned by the judgement debtor in that county at the time the lien is recorded. Interestingly, if the debtor acquires real property in that county after the abstract is recorded, the judgement lien will attach to that property by operation of law.

Liens on real property are very strong collection tools. Once recorded, a judgement lien can only be removed by satisfying the debt or through certain types of bankruptcy proceedings. As a prevailing plaintiff, I strongly recommend that you immediately record your judgement in the relevant county in order to preserve your right to collect down the road.

While a judgement lien recorded against real property might not result in money coming into your pocket immediately, it does give you a secured interest in real property that exists. This security lets you pursue other collection activity such as garnishments or levies.

What about personal property?

Recording abstracts of judgment only creates secured interests in real property. You can do the same for personal property, such as boats, airplanes or other assets by going through a similar process with the Secretary of State.

Take action quickly

I strongly recommend that a judgement creditor take fast action to collect on their recently-acquired judgement, even if collection activity doesn’t seem immediately likely to result in a recovery. You never know what can happen in life. The defendant may be out of business or insolvent today, but could hit the lottery or come into a large inheritance tomorrow.

Don’t leave any of your collection tools on the table. Judgement liens will preserve your right to be paid and are especially powerful collection tools when the defendant owns real property in the state.


If you have questions about California civil judgements, please call my office at (916) 333-2222.

Filing a lawsuit in a Sacramento court isn’t free. There is almost always a filing fee associated with starting a new lawsuit. The filing fee will depend on the court in which you are filing and the type of lawsuit involved.

Sacramento Superior Court

The Sacramento Superior Court classifies lawsuits based upon the amount of money in controversy. “Unlimited Civil” cases are lawsuit where there is more than $25,000 at stake. The filing fee for an unlimited case is currently $435.

For civil lawsuits that demand less than $25,000, the filing fee is tiered based upon the monetary demand. From $10,000 to $25,000, the complaint fee is $370. Lawsuits for less than $10,000 will incur a fee of $225.

This fee does not only apply to plaintiffs. A defendant filing an answer or other responsive pleading (the court just calls them “first papers”) must pay the same fee to participate in the lawsuit.

These fees were updated by the court on April 1, 2015. The fees do change time to time, so it is best to check with the court for the updated fee list.

Federal District Court

Not all lawsuits in Sacramento should be filed with the Superior Court. Some types of lawsuits are better off being filed in a United States District Court. The federal court that covers Sacramento is called the Eastern District of California.

The federal court does not make a distinction amongst ciivl cases of varying dollar amounts. All civil cases there have a $400 filing fee.

Unlike in Superior Court, a defendant does not have to pay a fee to file his or her answer with the court. This is a big advantage for defendants being sued in federal court.

Again, the court changes its fee schedule from time to time. Here is a link to their most current list of civil fees.


Have questions about civil litigation in the Sacramento area? Don’t hesitate to call my office to schedule a consultation. The office phone number is (916) 333-2222.

Sacramento – In an important ruling, the U.S. District Court for the Eastern District of California ruled against serial ADA attorney Jason Singleton and his client.

Mr. Singleton, infamous in Northern California for his relentless pursuit of small businesses like the iconic Squeeze Inn burger restaurant in Drive-by lawsuits, filed a lawsuit under a federal immigration contract (known as a I-864) against Sacramento resident Gary Lee.

Despite the obscurity and rarity of Mr. Singleton’s lawsuit, he attempted to bully Mr. Lee. When Mr. Lee refused to back off, Mr. Singleton continued his lawsuit against Mr. Lee.

“After several failed attempts to convince Mr. Singleton of his flawed lawsuit against me, I decided that Mr. Singleton was not going to back down,” commented defendant Gary Lee. That’s when I contacted Sacramento attorney Rick Morin to deal with Mr. Singleton for me.

Attorney Rick Morin, on behalf of Mr. Lee, successfully asked the Court to dismiss the case brought by Mr. Singleton.

“Gary Lee bravely stood up for his legal rights and refused to settle. This judgment is a testament to the power of the individual and the idea that law-abiding citizens can live without the fear of frivolous lawsuits filed against them,” said Rick Morin.

In Yaguil vs. Lee, the plaintiff filed a complaint asking the Court to force Mr. Lee to pay monetary support in the I-864 lawsuit. In deciding the case in favor of Mr. Lee, the Court stated that the plaintiff raised the same issue in state court and lost. Because the case had already been litigated, the Court found that the Plaintiff was barred from filing the same type of claim in a Federal District Court.

Yaguil v. Lee is case number 14-CV-00110.


Please contact Rick Morin if you have any questions about Yaguil v. Lee or I-864 lawsuits. Rick’s office can be reached at (916) 333-2222.

Last month I wrote about the first step in a Labor Commissioner case: the Notice of Claim and Conference.

Assuming that you are not able to resolve the claim informally at the conference, the Labor Commissioner will then set the matter for a formal hearing.

Here in Sacramento, hearings are being set between six and ten months after the date of the conference. As you can see, the Labor Commissioner in Sacramento is very impacted.

Between the end of the Conference and the date of the formal hearing, the defendant has the right and the opportunity to try to settle the matter. The defendant can propose a settlement directly to the plaintiff (if you know how to contact him or her) or through the Deputy Labor Commissioner that is assigned to your case.

The delay between conference and hearing can be in your favor. If you want to propose a settlement, a plaintiff may prefer to have a settlement check cut soon. The alternative for them is to wait up to ten months for a hearing that may or may not go the way that they want.

If the plaintiff’s claim truly has no merit, then you may decide to not settle the matter. If the matter is not resolved prior to the hearing, the hearing will occur as scheduled.

Sometimes the plaintiff does not appear at the hearing. If that is the case, the defendant wins automatically. The reverse is not true. If the defendant does not appear at the hearing, the plaintiff still must present his or her case before the hearing officer can award damages.

The hearings are very informal. The Hearing Officer will swear the witnesses in. Typically the Hearing Officer will briefly summarize his or her understanding of the issues. The Plaintiff is then allowed to present his or her case.

The Plaintiff may have received some assistance or coaching by staff at the Labor Commissioner’s office before the hearing. During the hearing itself, they are on their own.

Once the Plaintiff has presented his or her case, the Defendant is allowed to present a rebuttal. The Defendant can also ask questions of any of the plaintiff’s witnesses.

A Defendant is allowed to be represented by an attorney at the hearing. Witness testimony can be presented by bringing witnesses to the hearing or by providing sworn declarations. If you plan to bring sworn declarations to the hearing, you should have them notarized.

It is my experience that the Hearing Officers in Sacramento are very interactive. They tend to ask questions of both the attorneys and the witnesses.

After both sides have presented their case, the Hearing Officer will end the hearing. The Hearing Officer will not make a ruling on the spot. They will provide a written order, decision or award if they find for the Plaintiff.


I represent Sacramento employers and business owners in Labor Commissioner hearings. If you have any questions about Labor Commissioner hearings in Sacramento, please call my office. I can be reached at (916) 333-2222.