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Safe, NOTHING is safe, when you advertise telling those who come to your website that your business, activity, or land is safe, you will be writing checks for anything pain, blood, illness or injury that can occur.

Website for park stated it was a safe place for visitors. Plaintiff went to the park because of that statement and when she fell on a rock protruding above the boardwalk, she sued. Is a rock sticking through a boardwalk a risk, normal or at least “not safe.”

The plaintiff was able to claim negligent misrepresentation because the park represented itself as safe. Safe is a Bad work.

Kendall v. The Society for the Protection of New Hampshire Forests and White Mountains Recreation Association, Inc. d/b/a White Mountain Attractions Association, 2017 DNH 126; 2017 U.S. Dist. LEXIS 95362

State: New Hampshire: United States District Court for the District of New Hampshire

Plaintiff: Misha Kendall

Defendant: The Society for the Protection of New Hampshire Forests and White Mountains Recreation Association, Inc. d/b/a White Mountain Attractions Association

Plaintiff Claims: Negligence, Gross Negligence and Negligent Misrepresentation

Defendant Defenses:

Holding: for the plaintiff

Year: 2017

Summary

The website promoting the private park stated the park was safe. The plaintiff went, paid her fee and got hurt. Therefore, the park was not safe. The plaintiff was able to argue the statements made on the website about safety were negligent misrepresentation; Negligent statements made to induce the plaintiff to come to the park.

The second issue was a gap between a recently passed statute and decisions of the New Hampshire Supreme Court which effectively nullified the two immunity statutes by the legislature to protect the park.

Facts

There is always an issue of “when.” When did the plaintiff actually learn or see, but in this case, the court stated the following facts.

The land is owned by a nonprofit corporation, and is operated by a third party.

The Society for the Protection of New Hampshire Forests (the “Society”) is a nonprofit corporation which owns the Lost River Gorge and Boulder Caves (“Lost River”). White Mountain Attractions Association (“White Mountain”) operates Lost River. White Mountain manages Lost River’s website, and the Society contributes to and approves the website’s content.

The land is protected from lawsuits by a specific statute that was enacted in 1917.

Section 1. The Society for the Protection of New Hampshire Forests, being a corporation organized under the laws of this state for the purpose of encouraging the protection and preservation of forests and other natural resources of this state for the public benefit, and having in pursuance of its corporate purposes acquired several properties, including those known as Sunapee, Monadnock and Lost River’s reservations, which it has made accessible for use by the public by the building of paths, trails, bridges, and other structures, is hereby exempted from all civil liability in any suit or action by or on behalf of any person injured or claiming to have been injured through the negligent act or omission of said society or of any officer, agent, or employee thereof in constructing or maintaining such paths, trails, bridges, or other structures upon any property now held or hereafter acquired by it for such purposes.

So, the relationship with the state is, it is not a state park, but it is protected like one to a major extent.

The plaintiff alleges that was looking for an outdoor activity that would be safe for herself and her two six-year-old children. She went to the website of for the park to look for a “safe way” to view rock formations.

She took herself and her two children to the park, paid the entrance fee and proceeded to a boardwalk. The boardwalk was four feet wide and crowded. The boardwalk turned sharply after a bridge on the say to the Sun Altar cave. The plaintiff’s view was blocked after the turn because of the crowd, a sign and a large tree.

Just after the turn a boulder protruded up through the boardwalk about a foot.

Just after the turn, a large boulder extended through the middle of the boardwalk to a height of about a foot. The boardwalk was constructed around this boulder. There were no signs to warn of the boulder in the boardwalk. Kendall did not see the boulder in her path, tripped over it, and fell, shattering her elbow. Her digital camera was destroyed, and her clothing had to be cut off of her at the hospital. She has permanent damage to her elbow that has resulted in disability.

The plaintiff sued for her injuries.

Analysis: making sense of the law based on these facts.

The defendant raised four defenses to the gross negligence and negligent misrepresentation claims of the plaintiff.

Defendants contend that Kendall’s claims for gross negligence and negligent misrepresentation are futile for the following reasons: (a) defendants are immune from liability for both claims under the 1917 Law; (b) no claim for gross negligence exists under New Hampshire law; (c) the statement about the boardwalks being safe is not a misrepresentation of fact but merely an opinion; and (d) Kendall does not allege damages that can be recovered for negligent misrepresentation.

The court first started with the immunity statutes. Besides the specific immunity statute enacted in 1917, there was a more recent statute, RSA 508.14, II.

508:14. Landowner Liability Limited.

II. Any individual, corporation, or other nonprofit legal entity, or any individual who performs services for a nonprofit entity, that constructs, maintains, or improves trails for public recreational use shall not be liable for personal injury or property damage in the absence of gross negligence or willful or wanton misconduct.

Emphasize added

What never enters the discussion is the fact the plaintiff paid to be on the land, so the recreational use statute, RSA 508.14 should not apply.

The court first decided if the new statute canceled out the old statute and made the termination that it did not. It then examined both statutes stating that the statutes should be strictly construed and viewed as being consistent with each other. Reading the first statute that one, the court found the first statute stopped claims for negligence, but not gross negligence.

The issue though is the New Hampshire Supreme court ruled that New Hampshire does not recognize gross negligence. There is only one form of negligence in New Hampshire, simple negligence.

However, because the statute in question stated that the defendant could be liable for gross negligence or willful or wanton misconduct, the court held the legislature wanted the plaintiff to be able to sue for gross negligence.

Therefore, the plaintiff’s allegations of gross negligence were outside of the immunity afforded by both statutes.

Gross negligence was defined by the court as:

…”very great negligence, or the absence of slight diligence, or the want of even scant care” and willful misconduct has been interpreted as intentional conduct or recklessness that “carries a great chance of causing harm to another.”

Based on that definition the court was able to find the boulder built in the middle of the boardwalk was gross negligence.

…Kendall alleges that defendants built the boardwalk around an obstruction, a boulder that protrudes into the boardwalk approximately one foot higher than the boardwalk. She also alleges that the boulder is in a dangerous location, just around a turn, and is obscured by a sign, a tree, and crowds of people using the boardwalk. She alleges that defendants placed no warnings about the boulder for the tourists to see before walking on the boardwalk. The proposed amended complaint alleges that the obstructed boardwalk constitutes an obvious danger, and that defendants acted with gross negligence in failing to remove or warn of the boulder.

The court tackled the negligent misrepresentation claim next. Negligent misrepresentation is “a negligent misrepresentation of a material fact by the defendant and justifiable reliance by the plaintiff.” The website stated the place was safe and the plaintiff, in her opinion, found it wasn’t.

The court was not sold on the plaintiff’s allegations, however.

At this early stage, the court cannot determine whether defendants’ alleged statement that there were boardwalks at Lost River that provided a “safe way” to view rock formations is an actionable misrepresentation.

Whether the statement on the website was actionable would be based upon several factors: whether or not it was puffing, slight exaggerations to close the sale that everyone knows are not true, the specificity of the statement, the knowledge of the person making the statement and the knowledge of both parties in relation to each other.

The plaintiff argued “that on their website, defendants represented that there were boardwalks at Lost River that provided a “safe way” to view rock formations despite obvious dangers.”

The allegations made by the plaintiff were enough for the court not to dismiss them.

Consequently, the plaintiff will be allowed to amend her complaint to add additional claims, which would make the defendants motion to dismiss the original complaint moot.

So Now What?

Marketing makes promises that Risk Management has to Pay For. The marketing promised a safe place to recreate, and the plaintiff received in an injury there; therefore, the place was not safe.

Combine the statements made on the website with the gap between decisions of the New Hampshire Supreme Court and recent statutes in New Hampshire and the plaintiff was effective in keeping her claim alive.

What do you think? Leave a comment.

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Kendall v. The Society for the Protection of New Hampshire Forests and White Mountains Recreation Association, Inc. d/b/a White Mountain Attractions Association, 2017 DNH 126; 2017 U.S. Dist. LEXIS 95362

Kendall v. The Society for the Protection of New Hampshire Forests and White Mountains Recreation Association, Inc. d/b/a White Mountain Attractions Association, 2017 DNH 126; 2017 U.S. Dist. LEXIS 95362

Misha Kendall v. The Society for the Protection of New Hampshire Forests and White Mountains Recreation Association, Inc. d/b/a White Mountain Attractions Association

Civil No. 16-cv-428-LM

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE

2017 DNH 126; 2017 U.S. Dist. LEXIS 95362

June 21, 2017, Decided

June 21, 2017, Filed

CORE TERMS: gross negligence, boardwalk, negligent misrepresentation, immunity, river, boulder, leave to amend, futile, willful, citation omitted, immunity statutes, misrepresentation, nonprofit, website, bridge, repeal, trails, safe, common law right, misrepresentation claim, misconduct, construe, forest, entity, wanton, amend, path, internal quotation marks, formations, futility

COUNSEL: [*1] For Misha Kendall, Plaintiff: Benjamin T. King, LEAD ATTORNEY, Megan E. Douglass, Douglas Leonard & Garvey PC, Concord, NH.

For The Society for the Protection of NH Forests, White Mountains Attractions Association, Defendants: Robert E. Murphy, Jr., Wadleigh Starr & Peters PLLC, Manchester, NH.

JUDGES: Landya McCafferty, United States District Judge.

OPINION BY: Landya McCafferty

OPINION

ORDER

Misha Kendall brings suit against The Society for the Protection of New Hampshire Forests and White Mountain Recreation Association, Inc. alleging claims for negligence and gross negligence arising from her injuries and property damage sustained when she fell on a boardwalk at Lost River Gorge and Boulder Caves in Woodstock, New Hampshire. Defendants move to dismiss the complaint (doc. no. 13).

In response, Kendall objects and moves for leave to amend her complaint (doc. no. 20) to add factual allegations, remove her claim for negligence, and add a claim for negligent misrepresentation based on defendants’ statement on their website. Defendants object to the motion to amend.

The court first addresses Kendall’s motion for leave to amend her complaint, and then turns to defendants’ motion to dismiss.

I. Motion to Amend

In her proposed [*2] amended complaint, Kendall alleges claims for gross negligence and negligent misrepresentation. Defendants argue that the proposed amendment would be futile because they are immune from liability for both claims under 1917 New Hampshire Laws Chapter 19, § 1 (“1917 Law”) and because the proposed amended complaint fails to state a plausible claim for relief. Defendants also argue that the motion to amend is untimely.

Under Federal Rule of Civil Procedure 15(a)(2), the court will grant leave to amend a complaint “when justice so requires.” Despite the broad standard, a “court may deny leave to amend for a variety of reasons, including futility, bad faith, undue delay, or a dilatory motive on the movant’s part.” In re Curran, 855 F.3d 19, 27-28 (1st Cir. 2017) (internal quotation marks and citation omitted).

A. Timeliness

Defendants argue that Kendall’s motion should be denied because of undue delay, based on the time between when Kendall filed the original complaint and when she filed the motion for leave to amend.

Kendall brought suit as a pro se party, filing her complaint in state court on August 8, 2016. After defendants removed the case to this court, counsel entered an appearance on Kendall’s behalf on November 4, 2016. On December 7, 2016, defendant filed a motion to dismiss. [*3] Counsel responded to defendants’ motion to dismiss and then moved to amend on January 19, 2017. As such, the timing does not show undue delay, and defendants have not shown unfair prejudice that would result from allowing the amended complaint.

B. Futility

In the proposed amended complaint, Kendall alleges claims for gross negligence and negligent misrepresentation.1 Defendants contend that the proposed claims are futile.

1 Kendall also substitutes White Mountains Recreation Association, Inc. as the correct legal name for White Mountains Attraction Association.

1. Standard of Review

In assessing, before discovery, whether the claims in a proposed amended complaint are futile, the court uses the same standard that applies to motions to dismiss under Federal Rule of Civil Procedure 12(b)(6). Curran, 855 F.3d at 28; Adorno v. Crowley Towing & Transp. Co., 443 F.3d 122, 126 (1st Cir. 2006). The court takes the factual allegations in the proposed amended complaint as true and draws all reasonable inferences in favor of the plaintiff. Morgan v. Town of Lexington, 823 F.3d 737, 742 (1st Cir. 2016). Then, based on that view of the proposed amended complaint, the court determines whether the plaintiff has stated a plausible claim for relief. Curran, 855 F.3d at 28.

2. Background

The Society for the Protection of New Hampshire Forests (the “Society”) is a nonprofit corporation which owns the Lost River Gorge and Boulder Caves (“Lost River”). White Mountain Attractions Association (“White Mountain”) operates Lost River. White Mountain manages Lost River’s [*4] website, and the Society contributes to and approves the website’s content.

In her proposed amended complaint, Kendall alleges that she was looking for an outdoor activity that would be safe for her and her two six-year-old children. Kendall read about Lost River on its website and noted the descriptions and information provided. In particular, Kendall read that there were boardwalks at Lost River that provided “a ‘safe way’ to view rock formations.” Doc. no. 20-1 at ¶ 9.

On August 8, 2013, Kendall decided to go to Lost River with her children. She was an experienced hiker and dressed accordingly. When she and her children arrived, she paid the entrance fee, and they entered Lost River.

After walking down a sandy path through the forest, Kendall and the children came to a boardwalk and a bridge over a river. The boardwalk was crowded and no more than four feet wide. The boardwalk turned sharply after the bridge on the way to the “Sun Altar” cave. Because of the turn, the crowd, a sign giving information about the cave, and a large tree, Kendall could not see ahead on the boardwalk after the bridge.

Just after the turn, a large boulder extended through the middle of the boardwalk to a height [*5] of about a foot. The boardwalk was constructed around this boulder. There were no signs to warn of the boulder in the boardwalk. Kendall did not see the boulder in her path, tripped over it, and fell, shattering her elbow. Her digital camera was destroyed, and her clothing had to be cut off of her at the hospital. She has permanent damage to her elbow that has resulted in disability.

3. Discussion

Defendants contend that Kendall’s claims for gross negligence and negligent misrepresentation are futile for the following reasons: (a) defendants are immune from liability for both claims under the 1917 Law; (b) no claim for gross negligence exists under New Hampshire law; (c) the statement about the boardwalks being safe is not a misrepresentation of fact but merely an opinion; and (d) Kendall does not allege damages that can be recovered for negligent misrepresentation. Kendall responded to the futility arguments in her reply.

a. Immunity

There are two immunity statutes at issue in this case, and the parties dispute which one applies to the claims in Kendall’s proposed amended complaint.

In 1917, the New Hampshire legislature provided the Society with immunity from liability for any negligence [*6] in constructing or maintaining paths, trails, and bridges. The 1917 Law states:

Section 1. The Society for the Protection of New Hampshire Forests, being a corporation organized under the laws of this state for the purpose of encouraging the protection and preservation of forests and other natural resources of this state for the public benefit, and having in pursuance of its corporate purposes acquired several properties, including those known as Sunapee, Monadnock and Lost River reservations, which it has made accessible for use by the public by the building of paths, trails, bridges, and other structures, is hereby exempted from all civil liability in any suit or action by or on behalf of any person injured or claiming to have been injured through the negligent act or omission of said society or of any officer, agent, or employee thereof in constructing or maintaining such paths, trails, bridges, or other structures upon any property now held or hereafter acquired by it for such purposes.

(emphasis added).

A more recent statute, RSA 508:14, II, provides immunity to any nonprofit entity, such as the Society, “that constructs, maintains, or improves trails for public recreational use,” from liability “for [*7] personal injury or property damage.” This more recent immunity statute, however, provides an exception for “gross negligence or willful or wanton misconduct.” RSA 508:14, II states:

Any individual, corporation, or other nonprofit legal entity, or any individual who performs services for a nonprofit entity, that constructs, maintains, or improves trails for public recreational use shall not be liable for personal injury or property damage in the absence of gross negligence or willful or wanton misconduct.

(emphasis added).

Defendants contend that Kendall’s claims are futile because the 1917 Law gives them immunity from any claim involving negligence, which they contend includes claims for gross negligence and negligent misrepresentation. Defendants argue that because the 1917 Law is more specific, as it applies directly to the Society rather than to all nonprofit entities, it controls over the more general immunity provision in RSA 508:14, II. Not surprisingly, Kendall argues that RSA 508:14, II, and not the 1917 Law, applies to the claims in her proposed amended complaint. Because RSA 508:14, II provides an exception for claims based on allegations of gross negligence, such as the claims she alleges in her proposed amended [*8] complaint, Kendall asserts that defendants are not entitled to immunity.

At first glance, one might conclude that in enacting RSA 508:14, II, the New Hampshire legislature repealed the 1917 Law by implication. That is, the more recent immunity statute applies to a far broader spectrum of landowners, which would include the Society. The doctrine of “repeal by implication” is generally disfavored, however, especially where, as here, the more recent statute contains no expression of a legislative intent to repeal the 1917 Law. See generally Branch v. Smith, 538 U.S. 254, 273, 123 S. Ct. 1429, 155 L. Ed. 2d 407 (2003) (holding that “repeals by implication are not favored” unless there is “a clearly expressed congressional intention” (internal quotation marks and citation omitted)); Diaz-Ramos v. Hyundai Motor Co., 501 F.3d 12, 16-17 (1st Cir. 2007) (“A general law does not repeal a special law unless such repeal is expressly stated or clearly arises from the legislative intent.”) (internal quotation marks and citation omitted).

Moreover, a court should avoid applying the disfavored “repeal by implication” doctrine where it is possible to read two laws as consistent with one another. Indeed, the New Hampshire Supreme Court directs that where “reasonably possible, statutes should be construed as consistent with each other.” EnergyNorth Nat. Gas, Inc. v. City of Concord, 164 N.H. 14, 16, 48 A.3d 960 (2012) (quoting In re Union Tel. Co., 160 N.H. 309, 319, 999 A.2d 336 (2010)) (internal [*9] quotation marks omitted). Therefore, if possible, the court should construe the 1917 Law and RSA 508:14, II “so that they do not contradict each other, and so that they will lead to reasonable results and effectuate the legislative purpose of the statutes.” Soraghan v. Mt. Cranmore Ski Resort, Inc., 152 N.H. 399, 405, 881 A.2d 693 (2005) (internal citation omitted).

Another rule of statutory construction at play here calls for the court to narrowly construe immunity statutes. See, e.g., Estate of Gordon-Couture v. Brown, 152 N.H. 265, 267, 876 A.2d 196 (2005). Specifically, the rule requires the court to give a narrow construction to the term “negligent” in the 1917 Law because the Law restricts the common law right to recover for injuries caused by another’s negligence. Id. As the New Hampshire Supreme Court explained, a court must:

strictly interpret statutes that are in derogation of the common law. While a statute may abolish a common law right, there is a presumption that the legislature has no such purpose. If such a right is to be taken away, it must be expressed clearly by the legislature. Accordingly, immunity provisions barring the common law right to recover are strictly construed.

Cecere v. Loon Mountain Recreation Corp., 155 N.H. 289, 291, 923 A.2d 198 (2007) (internal citations omitted); see also Dolbeare v. City of Laconia, 168 N.H. 52, 54, 120 A.3d 146 (2015) (immunity statutes “in derogation of the common law right to recover, are strictly construed”).

In short, there are [*10] two rules of statutory construction that govern this dispute: courts should strictly construe immunity statutes and, where reasonably possible, courts should construe statutes as consistent with one another. Applying these principles, the court narrowly interprets the 1917 Law’s use of the term “negligent” to exclude gross negligence and wanton or willful conduct. Such a construction renders the scope of the immunity provided in 1917 Law consistent with the scope of immunity provided in RSA 508:14, II.

Defendants contend that New Hampshire law does not recognize a cause of action for gross negligence and, therefore, the term “negligent” in the 1917 Law necessarily includes gross negligence. In support of that assertion, they rely on Barnes v. N.H. Karting Ass’n, Inc., 128 N.H. 102, 509 A.2d 151 (1986), and the New Hampshire Supreme Court’s statement that “New Hampshire law does not distinguish causes of action based on ordinary and gross negligence.” Id. at 108.

By way of RSA 508:14, II, however, the New Hampshire legislature has included just such a distinction. In the context of nonprofit entities that maintain public trails for recreational use, the legislature has defined the scope of immunity by distinguishing between derivative degrees of negligence. Although the 1917 Law predates [*11] RSA 508:14, II, the court is not inclined to ignore the legislature’s unmistakably clear language exempting gross negligence from the scope of immunity in its more recent statute. Cf. Lee v. Chamberlain, 84 N.H. 182, 188, 148 A. 466 (1929) (“[W]here such doctrine is made the basis of a legislative rule, enforceable here, it cannot be treated as meaningless.”). Thus, the court finds that in the specific context at issue here, New Hampshire law does distinguish between ordinary and gross negligence.

For the reasons explained above, the court can–and therefore must–reasonably construe the 1917 Law and RSA 508:14, II as consistent with one another. As a practical matter, such a construction means that while both statutes provide immunity to defendants for claims based on allegations of negligence, neither provides immunity for claims based on allegations of gross negligence. The court therefore concludes that defendants are not entitled to immunity from Kendall’s claims to the extent they are based on allegations of gross negligence.

b. Merits of the Claims

Defendants contend that even if they are not immune from claims based on allegations of gross negligence or wanton or willful misconduct, the proposed amended complaint does not contain allegations that rise to that [*12] level. They also assert that the proposed amended complaint does not adequately allege a claim for negligent misrepresentation.

i. Gross Negligence

Gross negligence has been interpreted to mean “very great negligence, or the absence of slight diligence, or the want of even scant care” and willful misconduct has been interpreted as intentional conduct or recklessness that “carries a great chance of causing harm to another.” Beane v. Beane, 856 F. Supp. 2d 280, 307 (D.N.H. 2012) (internal quotation marks and citation omitted); see also Colston v. Boston & Me. R.R., 78 N.H. 284, 99 A. 649, 649 (1916) (noting “gross” in gross negligence means great and “willful” means with conscious knowledge).

In the proposed amended complaint, Kendall alleges that defendants built the boardwalk around an obstruction, a boulder that protrudes into the boardwalk approximately one foot higher than the boardwalk. She also alleges that the boulder is in a dangerous location, just around a turn, and is obscured by a sign, a tree, and crowds of people using the boardwalk. She alleges that defendants placed no warnings about the boulder for the tourists to see before walking on the boardwalk. The proposed amended complaint alleges that the obstructed boardwalk constitutes an obvious danger, and that defendants acted with gross [*13] negligence in failing to remove or warn of the boulder.

Drawing all reasonable inferences in Kendall’s favor, the proposed amended complaint sufficiently alleges gross negligence. Accordingly, the doctrine of futility does not bar Kendall’s request for leave to amend her complaint to allege a claim based on gross negligence.

ii. Negligent Misrepresentation

Defendants also contend that the proposed amended complaint does not adequately allege a claim for negligent misrepresentation. Kendall’s negligent misrepresentation claim is based on defendants’ statement on their website that there were boardwalks at Lost River that provided a “safe way” to view rock formations.

To state a claim for negligent misrepresentation, a plaintiff must allege facts that show “a negligent misrepresentation of a material fact by the defendant and justifiable reliance by the plaintiff.” Wyle v. Lees, 162 N.H. 406, 413, 33 A.3d 1187 (2011). Defendants contend that the alleged misrepresentation identified in the proposed amended complaint is merely an opinion, not a statement of fact, and, therefore, cannot be the basis of a negligent misrepresentation claim.

Although statements of opinion do not generally provide a proper basis for a claim for misrepresentation, [*14] under “certain circumstances, an opinion may constitute the basis of fraud or misrepresentation.” DePalantino v. DePalantino, 139 N.H. 522, 524, 658 A.2d 1207 (1995) (citing cases); see also Isaacs v. Dartmouth-Hitchcock Med. Ctr., No. 12-cv-040-LM, 2014 U.S. Dist. LEXIS 54183, 2014 WL 1572559, at *16 (D.N.H. Apr. 18, 2014). At this early stage, the court cannot determine whether defendants’ alleged statement that there were boardwalks at Lost River that provided a “safe way” to view rock formations is an actionable misrepresentation. See, e.g., Morris v. Princess Cruises, Inc., 236 F.3d 1061, 1067 (9th Cir. 2001) (“Whether a statement is an actionable statement of ‘fact’ or mere ‘puffing’ depends upon a number of factors, including the statement’s specificity, the speaker’s knowledge, the comparative levels of the speaker’s and the hearer’s knowledge, and whether the statement relates to the present or the future.”).2

2 Defendants also assert that the negligent misrepresentation claim is not based on allegations of gross negligence or willful or wanton misconduct and, therefore, they are immune from liability under both the 1917 Law and RSA 508:14, II. Viewed generously, however, the proposed amended complaint alleges that on their website, defendants represented that there were boardwalks at Lost River that provided a “safe way” to view rock formations despite obvious dangers. Whether defendants made the alleged misrepresentation with gross negligence requires factual development and cannot be determined at this stage of the litigation.

Defendants also contend that Kendall has not alleged damages that may be recovered for negligent misrepresentation. A plaintiff is entitled to her economic losses caused by a defendant’s negligent misrepresentation but is not entitled to damages for emotional distress. Crowley v. Global Realty, Inc., 124 N.H. 814, 817-18, 474 A.2d 1056 (1984).

Kendall makes no demand for damages in her proposed amended complaint that is specific to her negligent misrepresentation claim. Instead, at the conclusion of the proposed amended complaint, Kendall requests damages [*15] for medical expenses, lost wages and employment benefits, destroyed property, emotional distress and inconvenience, and loss of the enjoyment of life. Although she cannot recover for emotional distress and loss of the enjoyment of life under her claim for negligent misrepresentation, Kendall alleges other damages that are recoverable. Therefore, Kendall’s proposed negligent misrepresentation claim is not futile.

C. Result

The circumstances support allowing Kendall to amend her complaint. Defendants have not shown, at this stage of the case, that Kendall’s claims would be futile. Therefore, Kendall is granted leave to file her amended complaint.

II. Motion to Dismiss

Defendants moved to dismiss Kendall’s original complaint. When the amended complaint is filed, it will supersede the original complaint, making the motion to dismiss moot. Brait Builders Corp. v. Mass. Div. of Capital Asset Mgmt., 644 F.3d 5, 9 (1st Cir. 2011). For that reason, the motion to dismiss is denied as moot.

CONCLUSION

For the foregoing reasons, plaintiff’s motion for leave to amend (doc. no. 20) is granted. Plaintiff shall file the proposed amended complaint attached to document no. 20 as the amended complaint on or before June 23, 2017. Defendants’ motion to dismiss (doc. no. 13) is denied as moot.

[*16] SO ORDERED.

/s/ Landya McCafferty

Landya McCafferty

United States District Judge

June 21, 2017


Hiett v. Lake Barcroft Community Association, Inc., et al., 244 Va. 191; 418 S.E.2d 894; 1992 Va. LEXIS 69; 8 Va. Law Rep. 3381

Hiett v. Lake Barcroft Community Association, Inc., et al., 244 Va. 191; 418 S.E.2d 894; 1992 Va. LEXIS 69; 8 Va. Law Rep. 3381

Robert David Hiett v. Lake Barcroft Community Association, Inc., et al.

Record No. 911395

Supreme Court of Virginia

244 Va. 191; 418 S.E.2d 894; 1992 Va. LEXIS 69; 8 Va. Law Rep. 3381

June 5, 1992

COUNSEL: Bernard S. Cohen (Sandra M. Rohrstaff; Cohen, Dunn & Sinclair, on brief), for appellant.

Joseph D. Roberts (Slenker, Brandt, Jennings & Johnson, on brief), for appellees.

JUDGES: Justice Keenan delivered the opinion of the Court.

OPINION BY: KEENAN

OPINION

[*192]   [**894]  The primary issue in this appeal is whether a pre-injury release from liability for negligence is void as being against public policy.

Robert D. Hiett sustained an injury which rendered him a quadriplegic while participating in the “Teflon Man Triathlon” (the triathlon) sponsored by the Lake Barcroft  [**895]  Community Association, Inc. (LABARCA).  The injury occurred at the start of the swimming event when Hiett waded into Lake Barcroft to a point where the water reachedhis [***2]  thighs, dove into the water, and struck his head on either the lake bottom or an object beneath the water surface.

Thomas M. Penland, Jr., a resident of Lake Barcroft, organized and directed the triathlon. He drafted the entry form which all participants were required to sign.  The first sentence of the form provided:

In consideration of this entry being accept[ed] to participate in the Lake Barcroft Teflon Man Triathlon I hereby, for myself, my heirs, and executors waive, release and forever discharge any and all rights and claims for damages which I may have or  [*193]  m[a]y hereafter accrue to me against the organizers and sponsors and their representatives, successors, and assigns, for any and all injuries suffered by me in said event.

Evelyn Novins, a homeowner in the Lake Barcroft subdivision, asked Hiett to participate in the swimming portion of the triathlon. She and Hiett were both teachers at a school for learning-disabled children.  Novins invited Hiett to participate as a member of one of two teams of fellow teachers she was organizing.  During a break between classes, Novins presented Hiett with the entry form and he signed it.

Hiett alleged inhis [***3]  third amended motion for judgment that LABARCA, Penland, and Novins had failed to ensure that the lake was reasonably safe, properly supervise the swimming event, advise the participants of the risk of injury, and train them how to avoid such injuries.  Hiett also alleged that Penland and Novins were agents of LABARCA and that Novins’s failure to direct his attention to the release clause in the entry form constituted constructive fraud and misrepresentation.

In a preliminary ruling, the trial court held that, absent fraud, misrepresentation, duress, illiteracy, or the denial of an opportunity to read the form, the entry form was a valid contract and that the pre-injury release language in the contract released the defendants from liability for negligence.  The trial court also ruled that such a release was prohibited as a matter of public policy only when it was included: (1) in a common carrier’s contract of carriage; (2) in the contract of a public utility under a duty to furnish telephone service; or (3) as a condition of employment set forth in an employment contract.

Pursuant to an agreement between the parties, the trial court conducted an evidentiary hearing in whichit determined [***4]  that there was sufficient evidence to present to a jury on the issue of constructive fraud and misrepresentation. Additionally, the trial court ruled that as a matter of law Novins was not an agent of LABARCA, and it dismissed her from the case.

The remaining parties proceeded to trial solely on the issue whether there was constructive fraud and misrepresentation by the defendants such as would invalidate the waiver-release language in the entry form.  After Hiett had rested his case, the trial court granted the defendants’ motion to strike the evidence.  This appeal followed.

[*194]  Hiett first argues that the trial court erred in ruling that the pre-injury release provision in the entry form did not violate public policy. He contends that since the decision of this Court in Johnson’s Adm’x v. Richmond and Danville R.R. Co., 86 Va. 975, 11 S.E. 829 (1890), the law in Virginia has been settled that an agreement entered into prior to any injury, releasing a tortfeasor from liability for negligence resulting in personal injury, is void because it violates public policy. Hiett asserts that the later cases of this Court have addressed only therelease of liability [***5]  from property damage or indemnification against liability to third parties. Thus, he contends that the holding in Johnson remains unchanged.  In response, LABARCA and Novins argue that the decisions of this Court since Johnson have established  [**896]  that pre-injury release agreements such as the one before us do not violate public policy. We disagree with LABARCA and Novins.

The case law in this Commonwealth over the past one hundred years has not altered the holding in Johnson.  In Johnson, this Court addressed the validity of a pre-injury release of liability for future negligent acts.  There, the decedent was a member of a firm of quarry workers which had entered into an agreement with a railroad company to remove a granite bluff located on the company’s right of way.  The agreement specified that the railroad would not be liable for any injuries or death sustained by any members of the firm, or its employees, occurring from any cause whatsoever.

The decedent was killed while attempting to warn one of his employees of a fast-approaching train. The evidence showed that the train was moving at a speed of not less than 25 miles per hour, notwithstanding the [***6]  railroad company’s agreement that all trains would pass by the work site at speeds not exceeding six miles per hour.

[1] In holding that the release language was invalid because it violated public policy, this Court stated:

[T]o hold that it was competent for one party to put the other parties to the contract at the mercy of its own misconduct . . . can never be lawfully done where an enlightened system of jurisprudence prevails.  Public policy forbids it, and contracts against public policy are void.

 [*195]  86 Va. at 978, 11 S.E. at 829. This Court emphasized that its holding was not based on the fact that the railroad company was a common carrier.  Rather, this Court found that such  [HN1] provisions for release from liability for personal injury which may be caused by future acts of negligence are prohibited “universally.” 86 Va. at 978, 11 S.E. at 830.

[2] As noted by Hiett, the cases following Johnson have not eroded this principle.  Instead, this Court’s decisions after Johnson have been limited to upholding theright to contract for the release of liability for property damage, as well as indemnification from liability to [***7]  third parties for such damage.

[3] In C. & O. Ry. Co. v. Telephone Co., 216 Va. 858, 224 S.E.2d 317 (1976), this Court upheld a provision in an agreement entered into by the parties to allow the telephone company to place underground cables under a certain railway overpass.  In the agreement, the telephone company agreed to release the C & O Railway Company from any damage to the wire line crossing and appurtenances.  In upholding this property damage stipulation, this Court found that public policy considerations were not implicated.  216 Va. at 865-66, 224 S.E. at 322.

This Court upheld another property damage release provision in Nido v. Ocean Owners’ Council, 237 Va. 664, 378 S.E.2d 837 (1989). There, a condominium unit owner filed suit against the owners’ council of the condominium for property damage to his unit resulting from a defect in the common area of the condominium. This Court held that, under the applicable condominium by-laws, each unit owner had voluntarily waived his right to bring an action againstthe owners’ council for such property damage. 237 Va. at 667, 378 S.E.2d at 838. 1

1 Although the by-law at issue attempted to release the owners’ council for injury to both persons and property, the issue before the Court involved only the property damage portion of the clause.

 [***8]  [4] Other cases decided by this Court since Johnson have upheld provisions for indemnification against future property damage claims.  In none of these cases, however, did the Court address the issue whether an indemnification provision would be valid against a claim for personal injury.

In Richardson – Wayland v. VEPCO, 219 Va. 198, 247 S.E.2d 465 (1978), the disputed claim involved property damage only, although  [**897]  the contract provided that VEPCO would be indemnified against both property damage and personal injury claims.  This  [*196]  Court held that the provision for indemnification against property damage did not violate public policy. In so holding, this Court emphasizedthe fact that the contract was not between VEPCO and a consumer but, rather, that it was a contract made by VEPCO with a private company for certain repairs to its premises.  219 Va. at 202-03, 247 S.E.2d at 468.

This Court also addressed an indemnification clause covering liability for both personal injury and property damage in Appalachian Power Co. v. Sanders, 232 Va. 189, 349 S.E.2d 101 (1986). However, this Court was not required [***9]  to rule on the validity of the clause with respect to a claim for personal injury, based on its holding that the party asserting indemnification was not guilty of actionable negligence.  232 Va. at 196, 349 S.E. at 106.

Finally, in Kitchin v. Gary Steel Corp., 196 Va. 259, 83 S.E.2d 348 (1954), this Court found that an indemnification agreement between a prime contractor and its subcontractor was not predicated on negligence.  For this reason, this Court held that there was no merit in the subcontractor’s claim that the agreement violated public policy as set forth in Johnson.  196 Va. at 265, 83 S.E.2d at 351.

[5] We agree with Hiett that the above cases have notmodified or altered the holding in Johnson.  Therefore, we conclude here, based on Johnson, that the pre-injury release provision signed by Hiett is prohibited by public policy and, thus, it is void. Johnson, 86 Va. at 978, 11 S.E. at 829.

[6] Since we have held that the pre-injury release agreement signed by Hiett is void, the issue whether Novins acted as LABARCA’s agent in procuring Hiett’s signature will not be before the trial court in [***10]  the retrial of this case.  Nevertheless, Hiett argues that, irrespective of any agency relationship, Novins had a common law duty to warn Hiett of the dangerous condition of the uneven lake bottom. We disagree.

[7] The record before us shows that Lake Barcroft is owned by Barcroft Beach, Incorporated, and it is operated and controlled by Barcroft Lake Management Association, Incorporated.  Further, it is undisputed that the individual landowners in the Lake Barcroft subdivision have no ownership interest in the Lake. Since Novins had no ownership interest in or control over the operation of Lake Barcroft, she had no duty to warn Hiett of any dangerous condition therein.  See Busch v. Gaglio, 207 Va. 343, 348, 150 S.E.2d 110, 114 (1966).Therefore, Hiett’s assertion that Novins had a duty to warn him of the condition of the lake bottom, fails as a matter of  [*197]  law, and we conclude that the trial court did not err in dismissing Novins from the case.

Accordingly, we will affirm in part and reverse in part the judgment of the trial court, and we will remand this case for further proceedings consistent with the principles expressed in this opinion. 2

2 Based on our decision here, we do not reach the questions raised by the remaining assignments of error.

[***11]  Affirmed in part, reversed in part, and remanded.

 


Allegations of fraud inducing a non-English speaking client to sign a release are enough to void the release in California.

Second issue, intentionally increasing the risk to the plaintiff after the release has been signed is also enough to void a release.

Jimenez et al., v. 24 Hour Fitness USA, Inc., 237 Cal. App. 4th 546; 188 Cal. Rptr. 3d 228; 2015 Cal. App. LEXIS 494

State: California

Plaintiff: Etelvina Jimenez et al.

Defendant: 24 Hour Fitness USA, Inc.

Plaintiff Claims: 1) the liability release is not enforceable against plaintiffs’ claim of gross negligence; (2) the release was obtained by fraud and misrepresentation; and (3) the release only encompasses reasonably foreseeable risks and Etelvina’s injury was not reasonably foreseeable at the time she signed the release.

Defendant Defenses: Release

Holding: for the plaintiff

Year: 2015

This is a fitness center case that has two very important issues in the appellate court decision. The first is proof of a product liability claim against the defendant fitness facility for failing to follow the manufacturer’s recommendations. The second is the release may be void because the plaintiff did not read or understand English, and she was fraudulent induced to sign the release.

The plaintiff went to the defendant fitness facility to join. At the time, she did not read or speak English. The plaintiff was directed to the membership manager. During their interaction, he used gestures and pointed to the monthly price on a computer monitor.

On the day she joined, she was directed to the membership manager, Justin Wilbourn. She was then required to sign a membership agreement. However, Etelvina could not read or speak English, and Wilbourn did not speak Spanish. Wilbourn knew Etelvina did not read or speak English. Nevertheless, he did not call a Spanish-speaking employee to help him translate. Instead, he pointed to his computer screen to a figure, $24.99, indicating the membership fee, and made pumping motions with his arms like he were exercising. Etelvina understood the numbers, which are identical in Spanish, and she understood Wilbourn’s physical gestures to mean that if she paid that amount, she could use the facility. She could not read anything else. Wilbourn then pointed to the lines in the agreement for Etelvina to sign.

The plaintiff signed the release and had been a member for two years when the incident occurred.

The plaintiff was injured when she fell off a treadmill. She does not remember the incident. Expert witnesses for the plaintiff established she fell and suffered a head injury when she struck an exposed steel foot of a leg exercise machine. The exposed foot was 3’ 10” behind the treadmill she was on. The owner’s manual of the treadmill and an expert witness hired by the plaintiff stated the safety area behind the treadmill should be 6’ x 3’.

However, the treadmill manufacturer’s owner’s manual instructed in a section titled “Treadmill Safety Features”: “[I]t is important to keep the area around the treadmill open and free from encumbrances such as other equipment. The minimum space requirement needed for user safety and proper maintenance is three feet wide by six feet deep … directly behind the running belt.” The manufacturer’s assembly guide for the treadmill also says to provide a minimum six-foot clearance behind the treadmill for “user safety” and maintenance.

The defendant filed a motion for summary judgment, which was granted and the plaintiff appealed.

Analysis: making sense of the law based on these facts.

The court first laid out when a motion for summary judgment should be granted by the trial court. The party filling the motion must argue there are not factual issues, only legal issues and the law is on the side of the party filing. The responding party then to stop the granting of the motion must argue there are factual issues still at issue. When looking at the motions any decision that must be decided must be done so in favor of the party opposing the motion.

A trial court properly grants summary judgment where no triable issue of material fact exists and the moving party is entitled to judgment as a matter of law.” “[G]enerally, from commencement to conclusion, the party moving for summary judgment bears the burden of persuasion that there is no triable issue of material fact fact, that he is entitled to judgment as a matter of law.” If a defendant shows that one or more elements of a cause of action cannot be established or that there is a complete defense to that cause of action, the burden shifts to the plaintiff to show that a triable issue exists as to one or more material facts. If the trial court finds that no triable issue of fact exists, it then has the duty to determine the issue of law.

The court then looked at the definition of ordinary negligence and gross negligence under California law.

“‘Ordinary negligence’–an unintentional tort–consists of a failure to exercise the degree of care in a given situation that a reasonable person under similar circumstances would employ to protect others from harm.’Gross negligence’ long has been defined in California and other jurisdictions as either a ‘”‘want of even scant care'”‘ or ‘”‘an extreme departure from the ordinary standard of conduct.’

The court then examined the arguments concerning the product liability claims. The defendant argued that there was no industry standard of care for a safety zone around the treadmill. However, the court did not buy the argument because the manufacturer’s manual described a safety zone that should be observed.

24 Hour contends that there was no industry standard regarding a treadmill safety zone. They offer no cases or examples of any industry standard that violates a manufacturer’s safety directions. Indeed, it could be reasonably inferred that it is unlikely an industry would develop a standard that violates the express safety directions of the manufacturer.

The plaintiff’s pointed to three different requirements for a safety zone. The manufacturer’s owner’s manual, the manufacturer’s assembly instructions and the testimony of an expert witness of the plaintiff.

(1) the treadmill manufacturer’s owner’s manual instructed in its “Treadmill Safety Features” section that “[t]he minimum space requirement needed for user safety and proper maintenance is three feet wide by six feet deep”; (2) the manufacturer’s assembly guide for the treadmill also instructs that the treadmill requires a minimum six-foot-deep clearance behind it “for user safety and proper maintenance” (italics added); and (3) plaintiffs’ expert, Waldon, declared that “[f]or the safety of the users and in order to minimize injury, it is important that a safety zone behind the treadmill be kept clear of other machines and obstacles so that users falling off or pushed off the rear of the treadmill do not strike such objects,” and he opined that 24 Hour’s act of placing other exercise equipment inside the safety zone “greatly increased the risk of injury to [Etelvina].”

The evidence presented by the plaintiff the court found could be viewed as an industry standard.

In our view, based on the evidence plaintiffs presented, a jury could reasonably find that (1) it is standard practice in the industry to provide a minimum six-foot safety zone behind treadmills, based on the owner’s manual, assembly guide, and Waldon’s declaration as an expert; (2) 24 Hour did not provide this minimum six-foot safety zone, as declared by Neuman; and (3) the failure to provide the minimum safety zone was an extreme departure from the ordinary standard of conduct, as implied in Waldon’s declaration.

Later in reinforcing its statement the court found the only reason to place so many pieces of equipment so close together would be to make more money. “It can be inferred that 24 Hour did so for the purpose of placing more machines into its facility to accommodate more members to make more money.”

The next issue was the issue that the release was obtained by fraud and misrepresentation.

Plaintiffs contend that there are triable issues of fact as to whether 24 Hour obtained Etelvina’s sig-nature on the liability release through fraud and misrepresentation, which would invalidate the release as to all of plaintiffs’ theories of recovery.

The court looked at what a release is and when it can be voided.

A release may negate the duty element of a negligence action.” As we have noted, in order to absolve itself of responsibility for any ordinary negligence, it was 24 Hour’s burden to establish the validity of the release “as applied to the case at hand.”

Generally, a person who signs an instrument may not avoid the impact of its terms on the ground that she failed to read it before signing. However, a release is invalid when it is procured by misrepresentation, overreaching, deception, or fraud. “It has often been held that if the releaser was under a misapprehension, not due to his own neglect, as to the nature or scope of the release, and if this misapprehension was induced by the misconduct of the releasee, then the release, regardless of how comprehensively worded, is binding only to the extent actually intended by the releaser.”

The defendant argued there was no evidence that the employee made affirmative representations that the plaintiff to believe she was signing anything other than what was in front of her, the release.

Another significant issue the court found was the failure of the defendant employee to follow his own policy in this case and find a Spanish-speaking employee to translate. The defendant argued it had no duty to translate the release to the plaintiff.

However, the court stated it does not require a strong showing of misconduct to go to a jury on fraud and misrepresentation, only a slight showing. “A strong showing of misconduct” by the plaintiff is not necessary to demonstrate the existence of a triable issue of fact here; only a “‘slight showing'” is required.

Here, if a jury were to be persuaded that Wilbourn made misrepresentations to Etelvina about the contents of the agreement by making nonverbal gestures indicating that what she was signing related only to being allowed to exercise if she paid the price on the computer screen, it would be entitled to find that Etelvina’s signature on the release was produced by misrepresentation and that the release is not enforceable against her.

Looking at all the facts and inferences construed in the favor of the plaintiff the court found the evidence could be interpreted by a jury to be fraud.

The last issue and the one that should be a clear warning to all, is the change in the risk by the defendant after the plaintiff signed the release. The person signing the release assumes the standard safety precautions are being undertaken by the defendant at the time the release is signed. If those precautions are changed, meaning increased by the defendant after the release is signed, the release may be unenforceable.

On appeal, plaintiffs also contend that the release is unenforceable because a release only encompasses risks that are foreseeable at the time it is signed, and it was not reasonably foreseeable that 24 Hour would intentionally increase the risk of danger to its treadmill users.

However, the plaintiff’s did not raise this argument at the trial court so the court did not rule on it. However, the court clearly thought it would be sufficient to void the release in this case.

So Now What?

There are two clear issues here that everyone should be aware of. The first is if the manufacturer of a product says this is how the product should be used; this can be interpreted as the standard of care and how you MUST use the product. That use of the product includes any safety information the product describes.

The second is any act that could be interpreted as fraudulent can be used to void a release. The release was not voided because the plaintiff could not read or understand it. The release was sent back to determine if the actions of the defendant were fraudulent in inducing the plaintiff to sign the release.

The final issue is the change of the risk after the release is signed. The court seems to say that at the time the release is signed the risk can be assumed by the plaintiff to be the normal risks associated with the activity or sport. If at any time after the release is signed, the actions of the defendant change or increase those risks, the release maybe void by the plaintiff.

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Jimenez et al., v. 24 Hour Fitness USA, Inc., 237 Cal. App. 4th 546; 188 Cal. Rptr. 3d 228; 2015 Cal. App. LEXIS 494

Jimenez et al., v. 24 Hour Fitness USA, Inc., 237 Cal. App. 4th 546; 188 Cal. Rptr. 3d 228; 2015 Cal. App. LEXIS 494

Etelvina Jimenez et al., Plaintiffs and Appellants, v. 24 Hour Fitness USA, Inc., Defendant and Respondent.

C071959

COURT OF APPEAL OF CALIFORNIA, THIRD APPELLATE DISTRICT

237 Cal. App. 4th 546; 188 Cal. Rptr. 3d 228; 2015 Cal. App. LEXIS 494

June 9, 2015, Opinion Filed

SUBSEQUENT HISTORY: Time for Granting or Denying Review Extended Jimenez v. 24 Hour Fitness USA, Inc., 2015 Cal. LEXIS 8476 (Cal., Aug. 10, 2015)

Review denied by, Request denied by Jimenez v. 24 Hour Fitness United States, 2015 Cal. LEXIS 9252 (Cal., Sept. 23, 2015)

PRIOR HISTORY: [***1] APPEAL from a judgment of the Superior Court of Sacramento County, No. 34201100096852-CUPOGDS, David I. Brown, Judge.

DISPOSITION: Reversed.

COUNSEL: Moseley Collins III and Thomas G. Minder for Plaintiffs and Appellants.

Bruce L. Davis and Jack C. Nick for Defendant and Respondent.

JUDGES: Opinion by Murray, J., with Blease, Acting P. J., and Hull, J., concurring.

OPINION BY: Murray, J.

OPINION

[**230] MURRAY, J.–Plaintiffs Etelvina and Pedro Jimenez appeal from summary judgment in favor of defendant 24 Hour Fitness USA, Inc. (24 Hour), in plaintiffs’ negligence action stemming from a catastrophic injury sustained by Etelvina while using a treadmill at 24 Hour. Plaintiffs asserted that 24 Hour was grossly negligent in setting up the treadmill in a manner that violated the manufacturer’s safety instructions. 24 Hour moved for summary judgment, contending that it was not liable as a matter of law because Etelvina signed a liability release when she joined the gym. The trial court agreed and granted summary judgment.

On appeal, plaintiffs contend that the trial court erred in granting summary judgment in 24 Hour’s favor because (1) the liability release is not enforceable against plaintiffs’ claim of gross negligence; (2) the release was obtained [***2] by fraud and misrepresentation; and (3) the release only encompasses reasonably foreseeable risks and Etelvina’s injury was not reasonably foreseeable at the time she signed the release.

The third contention is forfeited for purposes of this appeal, but we agree with the first two contentions. Accordingly, we reverse. [*549]

FACTUAL AND PROCEDURAL BACKGROUND

Undisputed Facts1

1 The facts are taken from plaintiffs’ and 24 Hour’s separate statements of fact. The only fact that was specifically disputed was 24 Hour’s claim that plaintiffs did not identify “any statutory violation committed by 24 Hour.” Plaintiffs disputed this assertion, responding that Civil Code section 1668 precludes releases obtained through fraud. 24 Hour did not dispute any of plaintiffs’ facts but did object to most of them on various evidentiary grounds, and the trial court overruled these objections. The court’s ruling on defendant’s objections is not challenged on appeal. Accordingly, plaintiffs’ separate statement of facts is undisputed for purposes of our review on appeal. (See Guz v. Bechtel National, Inc. (2000) 24 Cal.4th 317, 334 [100 Cal. Rptr. 2d 352, 8 P.3d 1089] [“On [HN1] appeal after a motion for summary judgment has been granted, we review the record de novo, considering all the evidence set forth in the moving and opposition papers [***3] except that to which objections have been made and sustained.”].)

Plaintiffs filed a complaint against 24 Hour stating causes of action for premises [**231] liability, general negligence, and loss of consortium. The action arose out of injuries Etelvina sustained on January 16, 2011, while exercising at a 24 Hour facility in Sacramento, California. Etelvina’s expert opined that she fell backwards off of a moving treadmill and sustained severe head injuries when she hit her head on the exposed steel foot of a leg exercise machine that 24 Hour placed approximately three feet 10 inches behind the treadmill.

24 Hour filed an answer to the complaint generally denying the allegations and claiming several affirmative defenses, including the defense that plaintiffs’ claims were barred by a liability release.

At the time of her injuries, Etelvina was a member of 24 Hour. She joined 24 Hour approximately two years before the day she sustained her injury, and thereafter, she used the facilities regularly several times per week. On the day she joined, she was directed to the membership manager, Justin Wilbourn. She was then required to sign a membership agreement. However, Etelvina could not read or speak [***4] English, and Wilbourn did not speak Spanish. Wilbourn knew Etelvina did not read or speak English. Nevertheless, he did not call a Spanish-speaking employee to help him translate. Instead, he pointed to his computer screen to a figure, $24.99, indicating the membership fee, and made pumping motions with his arms like he was exercising. Etelvina understood the numbers, which are identical in Spanish, and she understood Wilbourn’s physical gestures to mean that if she paid that amount, she could use the facility. She could not read anything else. Wilbourn then pointed to the lines in the agreement for Etelvina to sign.

The membership agreement contained a liability release provision, which provided: “Using the 24 Hour USA, Inc. (24 Hour) facilities involves the risk [*550] of injury to you or your guest, whether you or someone else causes it. Specific risks vary from one activity to another and the risks range from minor injuries to major injuries, such as catastrophic injuries including death. In consideration of your participation in the activities offered by 24 Hour, you understand and voluntarily accept this risk and agree that 24 Hour, its officers, directors, employees, volunteers, agents [***5] and independent contractors will not be liable for any injury, including, without limitation, personal, bodily, or mental injury, economic loss or any damage to you, your spouse, guests, unborn child, or relatives resulting from the negligence of 24 Hour or anyone on 24 Hour’s behalf or anyone using the facilities whether related to exercise or not. … By signing below, you acknowledge and agree that you have read the foregoing and know of the nature of the activities at 24 Hour and you agree to all the terms on pages 1 through 4 of this agreement and acknowledge that you have received a copy of it and the membership policies.”

Wilbourn did not point out the release to Etelvina or make any other indications about the scope of the agreement aside from his gestures mimicking exercise and the fee. Etelvina believed she signed an agreement only to pay the monthly fee of [**232] $24.99. In her declaration supporting plaintiffs’ separate statement, Etelvina declared that “Wilbourn misrepresented the agreement and deceived [her]. He hid from [her] that she was also signing a release of liability.” Etelvina also declared that Wilbourn “misled” and “defrauded” her, and she relied on Wilbourn’s “indication [***6] of the meaning of the contract.”2

2 Plaintiffs also submitted a declaration by Etelvina’s sister, Emelia Villaseñor, who declared that she went through the same process at 24 Hour and was similarly misled as to the contents of the membership agreement.

Etelvina has no memory of the incident leading to her injuries. However, Laurence H. Neuman, an expert on civil engineering and accident reconstruction, investigated the incident. In the course of his investigation, Neuman determined that the 24 Hour location in question had 21 treadmill machines. In the area where Etelvina fell, “the distance directly behind the running belt of the treadmill to the closest piece of equipment was 3 feet 10 inches.” Neuman determined that other treadmills in the gym were placed with an even shorter distance between the running belts and other gym equipment, approximately three feet. These measurements reflect the same conditions present at the time of Etelvina’s injuries.

However, the treadmill manufacturer’s owner’s manual instructed in a section titled “Treadmill Safety Features”: “[I]t is important to keep the area around the treadmill open and free from encumbrances such as other equipment. The minimum space [***7] requirement needed for user safety and proper [*551] maintenance is three feet wide by six feet deep … directly behind the running belt.” (Italics added.) The manufacturer’s assembly guide for the treadmill also says to provide a minimum six-foot clearance behind the treadmill for “user safety” and maintenance. Neuman determined that none of the 21 treadmills at this 24 Hour location had a six-foot safety clearance. Neuman concluded that 24 Hour’s act of placing other exercise equipment within the six-foot safety zone increased the risk of injury to persons using the treadmills.

Dr. James P. Dickens assessed Etelvina’s injuries, her medical records, and Neuman’s findings, and he determined that Etelvina fell backward while using the treadmill and “struck her head, fracturing the right occipital bone and right temporal bone.” Dr. Dickens noted that while the gym floor is covered with shock-absorbing material, there was a leg exercise machine with an exposed steel foot that was approximately three feet 10 inches behind the treadmill’s moving belt. Dr. Dickens opined that it was unlikely that Etelvina would have suffered the skull fractures had her head landed on the shock-absorbing floor [***8] coverings behind the treadmill and she likely hit her head on the leg machine. Additionally, Barton Waldon, a certified personal fitness trainer, opined that it is foreseeable that treadmill users occasionally trip, stumble, or fall off treadmills. Waldon declared that “[f]or the safety of the users and in order to minimize injury, it is important that a safety zone behind the treadmill be kept clear of other machines and obstacles so that users falling off or pushed off the rear of the treadmill do not strike such objects.” Accordingly, Waldon opined that 24 Hour’s act of placing exercise equipment inside the safety zone “greatly increased the risk of injury to [Etelvina].”

In his deposition, Wilbourn, the membership manager for 24 Hour, said that he did not remember meeting Etelvina, although he identified himself as the employee [**233] who assisted her based on his signature on her membership agreement. Wilbourn testified that typically, when he encountered a potential customer who only spoke Spanish, his habit and custom was to have a Spanish-speaking employee handle the signup for that potential customer.

Motion for Summary Judgment

24 Hour filed a motion for summary judgment, or in the alternative, [***9] summary adjudication, asserting that plaintiffs’ claims were barred by the release. As for the loss of consortium cause of action, 24 Hour argued the claim was barred because it was derivative of plaintiffs’ negligence and premises liability causes of action. Plaintiffs opposed the motion, contending that the release was invalid because 24 Hour was grossly negligent and because 24 Hour obtained the release through fraud. However, plaintiffs did not specifically raise the argument that the release did not encompass [*552] Etelvina’s injury because it was not reasonably foreseeable to her at the time she signed the release that 24 Hour would intentionally increase her risk of injury.

Plaintiffs argued that due to 24 Hour’s fraud in obtaining Etelvina’s signature on the release, the release was ineffective. Plaintiffs further argued that the holding in Randas v. YMCA of Metropolitan Los Angeles (1993) 17 Cal.App.4th 158, 163 [21 Cal. Rptr. 2d 245] (Randas), does not apply here, because in this case, unlike in Randas, there was overreaching and fraud. The court inquired how Etelvina could know that Wilbourn misrepresented the nature of the release if she could not understand English. Plaintiffs’ counsel replied that Wilbourn communicated with her about the purported contents of the membership [***10] agreement through gesturing and pointing at the numbers on the computer screen. The court then inquired about the gross negligence exception to enforcing releases, pointing out that plaintiffs did not specifically allege a cause of action for gross negligence in their complaint. Plaintiffs responded that under California law, there is not a distinct cause of action for gross negligence and alleging general negligence suffices.3 Plaintiffs also contended that the question of gross negligence is a question of fact to be resolved by the jury rather than a matter of law to be resolved on summary judgment. The court questioned whether there was an industry standard on the appropriate safety clearance behind treadmills. Plaintiffs contended that the industry standard is evidenced in the manufacturer’s directions and Waldon’s declaration. The court expressed concern that Waldon’s “assumption is predicated upon the fact that she was on the treadmill. If you assume she was not on the treadmill, and we don’t have any tissue or hair or blood on a piece of equipment that would allow us to pinpoint where it is, we can’t really know what was happening at the time of the accident.” The court indicated [***11] that while that circumstance did not necessarily mean defendant should prevail, it was something for the court to consider. Plaintiffs’ counsel responded that the court identified a factual dispute in the case for a jury to decide.

3 24 Hour does not make a contrary argument on appeal. We agree with plaintiffs that [HN2] California does not recognize a distinct common law cause of action for gross negligence apart from negligence. (City of Santa Barbara v. Superior Court (2007) 41 Cal.4th 747, 779-780 [62 Cal. Rptr. 3d 527, 161 P.3d 1095] (Santa Barbara); Continental Ins. Co. v. American Protection Industries (1987) 197 Cal.App.3d 322, 329-330 [242 Cal. Rptr. 784].) As a degree of negligence, “[g]ross negligence is pleaded by alleging the traditional elements of negligence: duty, breach, causation, and damages.” (Rosencrans v. Dover Images, Ltd. (2011) 192 Cal.App.4th 1072, 1082 [122 Cal. Rptr. 3d 22] (Rosencrans).)

[**234] During oral argument in the trial court, 24 Hour focused on the question of whether there was evidence of gross negligence, claiming it was impossible to detect the cause of plaintiffs’ injuries because she could not remember what happened. The trial court observed that this might be “a question of [*553] proof at trial.” The court then asked defense counsel why Etelvina’s testimony that Wilbourn misrepresented the content of the release would not create a factual issue for trial. Defense counsel responded that there was no evidence of “an affirmative act to deceive.” The court took the matter [***12] under submission.

The trial court granted 24 Hour’s motion. In its ruling, the court wrote that plaintiffs failed to present any evidence that Wilbourn “made any affirmative representations that led [Etelvina] to believe she was signing something other than what the agreement, on its face, purported to be.” The court further wrote that “[t]he fact that [Etelvina] elected to sign the agreement without understanding all of its terms cannot be considered the fault of [24 Hour].” With respect to the gross negligence argument, the court was persuaded by 24 Hour’s argument that, as a matter of law, a space of three to four feet as opposed to the recommended six-foot safety zone cannot constitute gross negligence, because “it does not reflect an ‘extreme departure from the ordinary standard of conduct.'” The court reasoned that 24 Hour’s “placement of the treadmill constitutes at most, ordinary negligence.” Consequently, the court ruled that plaintiffs “failed to demonstrate a triable issue of material fact with regard to the enforceability of the release.”

DISCUSSION

I. Standards of Review

[HN3] “A trial court properly grants summary judgment where no triable issue of material fact exists and the moving [***13] party is entitled to judgment as a matter of law.” (Merrill v. Navegar, Inc. (2001) 26 Cal.4th 465, 476 [110 Cal. Rptr. 2d 370, 28 P.3d 116] (Merrill), citing Code Civ. Proc., § 437c, subd. (c).) “[G]enerally, from commencement to conclusion, the party moving for summary judgment bears the burden of persuasion that there is no triable issue of material fact and that he is entitled to judgment as a matter of law.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850 [107 Cal. Rptr. 2d 841, 24 P.3d 493], fn. omitted (Aguilar).) If a defendant shows that one or more elements of a cause of action cannot be established or that there is a complete defense to that cause of action, the burden shifts to the plaintiff to show that a triable issue exists as to one or more material facts. (Doe v. California Lutheran High School Assn. (2009) 170 Cal.App.4th 828, 834 [88 Cal. Rptr. 3d 475], citing Aguilar, supra, 25 Cal.4th at p. 849.) If the trial court finds that no triable issue of fact exists, it then has the duty to determine the issue of law. (California School of Culinary Arts v. Lujan (2003) 112 Cal.App.4th 16, 22 [4 Cal. Rptr. 3d 785].)

[HN4] On appeal, we review the trial court’s decision de novo. (Merrill, supra, 26 Cal.4th at p. 476.) We independently review the papers supporting and [*554] opposing the motion, considering all the evidence offered in connection with the motion and any inferences that the evidence reasonably supports, applying the same rules and standards as the trial court. (Ibid.) We view the evidence in the light most favorable to plaintiffs as the losing parties. (Saelzler v. Advanced Group 400 (2001) 25 Cal.4th 763, 768-769 [107 Cal. Rptr. 2d 617, 23 P.3d 1143].) In liberally construing the evidence [**235] in favor of the party opposing the motion, we resolve [***14] all doubts concerning the evidence in favor of the opponent. (Miller v. Department of Corrections (2005) 36 Cal.4th 446, 460 [30 Cal. Rptr. 3d 797, 115 P.3d 77].)

II. Gross Negligence

A. The Parties’ Contentions

24 Hour contends it met its burden of showing that plaintiffs could not establish the duty element of their negligence cause of action by producing a valid release and the burden thus shifted to plaintiffs to show a triable issue of material fact. (Cf. Aguilar, supra, 25 Cal.4th at p. 849.) 24 Hour contends that plaintiffs failed to meet this burden and, accordingly, summary judgment was appropriate. Conversely, plaintiffs contend that there are triable issues of fact regarding the question of whether 24 Hour’s conduct constituted gross negligence, which would preclude 24 Hour’s reliance on the release to absolve it from liability. 24 Hour responds that the question of gross negligence was properly decided as a matter of law because plaintiffs’ allegation of gross negligence was unsupported in their summary judgment pleadings. Viewing the evidence in a light most favorable to plaintiffs, liberally construing that evidence and resolving all doubts in their favor, we disagree with 24 Hour.

B. Analysis

(1) ” [HN5] While often referred to as a defense, a release of future liability is more appropriately characterized as an express [***15] assumption of the risk that negates the defendant’s duty of care, an element of the plaintiff’s case. ‘”… The result is that the defendant is relieved of legal duty to the plaintiff; and being under no duty, he cannot be charged with negligence.” [Citation.]'” (Eriksson v. Nunnink (2015) 233 Cal.App.4th 708, 719 [183 Cal. Rptr. 3d 234] (Eriksson II).) In a summary judgment motion, the defendant bears the burden of establishing the validity of a release “as applied to the case at hand.” (Santa Barbara, supra, 41 Cal.4th at p. 780, fn. 58; see Eriksson v. Nunnink (2011) 191 Cal.App.4th 826, 856 [120 Cal. Rptr. 3d 90] (Eriksson I).)

[HN6] A release cannot absolve a party from liability for gross negligence. (Santa Barbara, supra, 41 Cal.4th at pp. 750-751, 776-777.) In Santa Barbara, our [*555] high court reasoned that “the distinction between ‘ordinary and gross negligence’ reflects ‘a rule of policy’ that harsher legal consequences should flow when negligence is aggravated instead of merely ordinary.” (Id. at p. 776, quoting Donnelly v. Southern Pacific Co. (1941) 18 Cal.2d 863, 871 [118 P.2d 465].) A liability release, “to the extent it purports to release liability for future gross negligence, violates public policy and is unenforceable.” (Santa Barbara, at p. 751.)

(2) The issue we must determine here is whether, with all facts and inferences construed in plaintiffs’ favor, the conduct shown by plaintiffs’ evidence could be found to constitute gross negligence. If so, then it is a question of fact for the jury to determine whether the [***16] release in this case was unenforceable for that reason. As our high court has noted, [HN7] whether conduct constitutes gross negligence is generally a question of fact, depending on the nature of the act and the surrounding circumstances shown by the evidence. (Santa Barbara, supra, 41 Cal.4th at pp. 767, 781 [reasoning that whether the evidence showed lack of care sufficient to constitute gross negligence was a triable issue of fact [**236] in that case].) The Courts of Appeal have followed suit, holding that generally, [HN8] it is a triable issue of fact whether a defendant’s lack of care constitutes gross negligence. (Decker v. City of Imperial Beach (1989) 209 Cal.App.3d 349, 358 [257 Cal. Rptr. 356] (Decker).) And when reviewing summary judgment based on the absence of a triable issue of fact as to gross negligence, we must resolve every reasonable doubt in favor of the plaintiffs. (Rosencrans, supra, 192 Cal.App.4th at p. 1088.)

“‘Ordinary negligence’–an unintentional tort–consists of a failure to exercise the degree of care in a given situation that a reasonable person under similar circumstances would employ to protect others from harm. [Citation.] [¶] [HN9] ‘Gross negligence’ long has been defined in California and other jurisdictions as either a ‘”‘want of even scant care'”‘ or ‘”‘an extreme departure from the ordinary standard of conduct.'”‘” (Santa Barbara, supra, 41 Cal.4th at pp. 753-754; see Eastburn v. Regional Fire Protection Authority (2003) 31 Cal.4th 1175, 1185-1186 [7 Cal. Rptr. 3d 552, 80 P.3d 656] (Eastburn).)

In [***17] Santa Barbara, a developmentally disabled child attended a special summer camp for disabled children run by the city. (Santa Barbara, supra, 41 Cal.4th at pp. 750-753.) Because she had frequent seizures, the child was assigned a counselor to monitor her closely. (Id. at p. 752.) However, when her counselor momentarily turned her attention away from the child, who was at that time swimming toward the side of the pool, the child suffered a seizure and drowned. (Id. at p. 753.) The city contended that a release signed by the child’s mother had absolved the city of liability for any negligence. (Id. at pp. 750, 753.) On appeal, our high court held that the family’s gross [*556] negligence claim was not barred by the release because an agreement purporting to protect the releasee from liability for conduct rising to the level of gross negligence is against public policy. (Id. at pp. 770-777.)

In Rosencrans, where the court concluded there was a question of fact regarding gross negligence, the showing was similar to the showing in the instant case. In that case, a motorcyclist was injured during motocross practice.4 (Rosencrans, supra, 192 Cal.App.4th at pp. 1077, 1083.) The plaintiffs presented two pieces of evidence in opposition to the defendant’s summary judgment motion, indicating that there was an industry standard to provide caution flaggers [***18] on motocross tracks: (1) the “‘Brett Downey Safety Foundation Instructional Manual for Caution Flaggers,'” which provided that caution flaggers should be at their stations at all times while motorcyclists are on the course (id. at p. 1086) and (2) a motocross safety expert’s declaration that “the common practice for motocross tracks is to have caution flaggers at their assigned posts at all times …” (ibid.). The court held that because “it is standard practice in the industry to have caution flaggers on their platforms at all times … ,” the defendant’s failure to provide a caution flagger raised a triable issue of material fact on the question of gross negligence. (Id. at pp. 1081, 1086-1087.)

4 “Motocross is a sport in which people ride motorcycles and perform jumps off of ramps, while in a setting filled with dust and other people on motorcycles.” (Rosencrans, supra, 192 Cal.App.4th at p. 1083.)

[**237] 24 Hour contends that there was no industry standard regarding a treadmill safety zone. They offer no cases or examples of any industry standard that violates a manufacturer’s safety directions. Indeed, it could be reasonably inferred that it is unlikely an industry would develop a standard that violates the express safety directions of the manufacturer. Plaintiffs, on the other [***19] hand, presented three pieces of evidence indicating a possible industry standard on treadmill safety zones: (1) the treadmill manufacturer’s owner’s manual instructed in its “Treadmill Safety Features” section that “[t]he minimum space requirement needed for user safety and proper maintenance is three feet wide by six feet deep” (italics added); (2) the manufacturer’s assembly guide for the treadmill also instructs that the treadmill requires a minimum six-foot-deep clearance behind it “for user safety and proper maintenance” (italics added); and (3) plaintiffs’ expert, Waldon, declared that “[f]or the safety of the users and in order to minimize injury, it is important that a safety zone behind the treadmill be kept clear of other machines and obstacles so that users falling off or pushed off the rear of the treadmill do not strike such objects,” and he opined that 24 Hour’s act of placing other exercise equipment inside the safety zone “greatly increased the risk of injury to [Etelvina].” This evidence is similar to the evidence presented in Rosencrans. While Waldon did not expressly use the words “common practice” or [*557] “industry standard,” such is an inference that his declaration reasonably [***20] supports, particularly when viewed in tandem with the manufacturer’s safety directions.

(3) In our view, based on the evidence plaintiffs presented, a jury could reasonably find that (1) it is standard practice in the industry to provide a minimum six-foot safety zone behind treadmills, based on the owner’s manual, assembly guide, and Waldon’s declaration as an expert; (2) 24 Hour did not provide this minimum six-foot safety zone, as declared by Neuman; and (3) the failure to provide the minimum safety zone was an extreme departure from the ordinary standard of conduct, as implied in Waldon’s declaration. Accordingly, plaintiffs created a triable issue of fact as to whether the failure to provide the minimum six-foot safety zone constituted an extreme departure from the ordinary standard of conduct.

While the issue of whether there has been gross negligence is generally a triable issue of fact, we recognize that such is not always the case. (See Decker, supra, 209 Cal.App.3d at p. 358.) For example, in a recent case involving 24 Hour, the Court of Appeal affirmed summary judgment grounded in part on the trial court’s determination that there was no triable issue of fact as to gross negligence. (Grebing v. 24 Hour Fitness USA, Inc. (2015) 234 Cal.App.4th 631, 639 [184 Cal. Rptr. 3d 155] (Grebing).) The contrast to our [***21] case supports our conclusion that, looking at the evidence in a light most favorable to plaintiffs, there is a triable issue of fact as to gross negligence in this case.

In Grebing, the plaintiff, who had twice signed 24 Hour’s release, was injured using a low row machine, when a clip failed causing a handlebar to break free from the cable and strike him in the forehead. (Grebing, supra, 234 Cal.App.4th at p. 634.) The evidence disclosed that the clip was the wrong clip, broken, or not working for the machine on which the plaintiff was exercising. (Id. at p. 635.) Some machines in the facility were missing clips and apparently members moved clips to other machines. Fifteen minutes before the plaintiff’s injury, another member reported [**238] that a different machine had a crooked clip. (Ibid.) The court held that to the extent the plaintiff was claiming 24 Hour should have inspected and replaced broken or improper clips on all machines within the 15 minutes after the other member’s complaint, that claim was insufficient to raise a triable issue of gross negligence. (Id. at p. 639.) Further, the court noted that “it is undisputed that 24 Hour took several measures to ensure that its exercise equipment and facility were well maintained. For example, it hired [***22] a facilities technician whose job was to conduct a daily inspection of the facility and perform preventative maintenance. If the facilities technician was unavailable, 24 Hour had a practice of requiring other staff members to conduct the inspection and perform any required maintenance.” (Ibid.) The Grebing court [*558] concluded, “In view of these measures, 24 Hour’s conduct cannot reasonably be regarded as demonstrating a want of even scant care or an extreme departure from the ordinary standard of conduct.” (Ibid.)

Here, unlike in Grebing where there was no notice, 24 Hour knew it was violating the manufacturer’s express safety directions when it deliberately arranged the gym equipment without providing a six-foot safety zone for the treadmills. It can be inferred that 24 Hour did so for the purpose of placing more machines into its facility to accommodate more members to make more money. And unlike in Grebing, where 24 Hour acted reasonably by conducting daily equipment inspections, there were no mitigation measures that would have prevented the injury plaintiffs alleged occurred here. We are not persuaded by 24 Hour’s argument that because it provided shock-absorbing flooring materials, [***23] it exhibited “some care” and a jury would be precluded from finding gross negligence. A shock-absorbing floor makes little difference when it is covered with gym equipment upon which members could fall and severely injure themselves. Thus, we cannot agree that this purported mitigation measure precludes a jury finding of gross negligence.

In reaching our conclusion, we also reject 24 Hour’s argument, as adopted by the trial court, that “the provision of three to four feet of space as opposed to the recommended six feet cannot, as a matter of law, constitute gross negligence as it does not reflect ‘an extreme departure from the ordinary standard of conduct.'” The misdirected focus on the two-to-three-foot difference between 24 Hour’s spacing and the recommended minimum spacing impliedly suggests that such difference was negligible and not “an extreme departure.” However, when one thinks of the minimum safety zone recommended by the treadmill manufacturer in terms of the height of adult human beings and the high likelihood of a person falling off a treadmill impacting nearby equipment as close as three feet, it seems clear that the reduced zone established by 24 Hour here can hardly be [***24] considered a “safety” zone at all. Accordingly, it strikes us that a departure of two to three feet from the recommended minimum six-foot safety zone makes a great difference under these circumstances. Without any expert testimony indicating otherwise and in light of plaintiffs’ expert’s declaration corroborating the manufacturer’s directions and the financial motivation that can be inferred from the evidence, we cannot agree that as a matter of law, the spacing of the machines demonstrates at least scant care and is not an extreme departure from the ordinary standard of conduct.

24 Hour contends that if the facts in several cases it cites do not amount to gross negligence, then the facts in this case certainly do not. In our view, 24 Hour’s cited cases are distinguishable. [*559] [**239]

24 Hour cites Decker as a comparable case on gross negligence. In Decker, a surfer became entangled in the tether of a submerged lobster trap and drowned after the city pursued an antiquated surf rescue method, the “lifeline rescue method.” (Decker, supra, 209 Cal.App.3d at pp. 352-353, 360.) There was evidence that the rescue personnel arrived promptly and made diligent efforts to attempt to rescue the surfer both with the sheriff’s dive team and with a helicopter, [***25] but the dive team used a rescue method disfavored for surf rescues. (Id. at pp. 360-361, 363.) The court reasoned that this evidence “could support a finding that use of the lifeline rescue method is a disfavored surf rescue method and would not be used by an experienced, trained surf rescuer but it does not support a finding the sheriff’s dive team was grossly negligent for having used this method given their lack of training or experience in surf rescue.” (Id. at p. 360, italics added.) The Decker court also noted that the plaintiff did not contest the validity of the sheriff’s first rescue attempt with the helicopter, which also failed. (Id. at pp. 360-361.) The failure to train for and use a specialized rescue method during an otherwise diligent rescue effort that included another undisputed rescue method is very different from 24 Hour’s failure to follow the treadmill manufacturer’s explicit directions to maintain a minimum six-foot safety zone. The conduct in Decker was, at best, passive negligence by people who did not know any better and did not create or even increase the risk of injury whereas in our case defendant’s conduct actively created or increased the risk of injury to treadmill users by deliberately setting up the [***26] equipment in a dangerous manner.

In DeVito v. State of California (1988) 202 Cal.App.3d 264 [248 Cal. Rptr. 330] (DeVito), another case upon which 24 Hour relies, a hiker swung from a firehose hung over a tree limb in a mountain canyon on public land, lost her grip, and fell down a steep slope, sustaining injuries. The appellate court affirmed dismissal of her complaint against the state on demurrer, primarily focusing on a statute, Government Code section 831.7, which provides “a public entity is not liable to ‘any person who participates in a hazardous recreational activity … for any … injury … arising out of that … activity.'” (DeVito, at pp. 267, 270.) The court noted that under the statute, “‘tree rope swinging'” is listed as one such hazardous recreational activity, and the primary issue on appeal was one of interpreting this statute. (Ibid.) The court, in a single, short paragraph, only briefly discussed the plaintiff’s secondary argument that the state engaged in gross negligence, concluding in summary fashion that no facts alleged in the complaint supported the allegation of gross negligence. (Id. at p. 272.)

DeVito is distinguishable on several bases. First, in this case, plaintiffs here did allege facts in their summary judgment opposition which support a finding of gross negligence, as discussed [***27] ante. Second, as in Decker, the plaintiff in DeVito did not allege facts indicating that the defendant actively [*560] created or increased the risk of harm. Instead, the plaintiff alleged that the state failed to “‘guard or warn of [a] known dangerous condition,'” which would not ordinarily rise to the level of gross negligence. (DeVito, supra, 202 Cal.App.3d at pp. 267, 272.) Third, and significantly, the court’s opinion in DeVito focused on the plaintiff’s failure “to guard or warn” argument because the gross negligence argument was barely raised and not supported in the plaintiff’s argument on appeal. (See id. at p. 272.) [**240] The court noted, “We could, but choose not to, ignore this contention since it is set forth in a single sentence of appellant’s opening brief, unsupported by either argument or authority.” (Id. at fn. 7.) Accordingly, DeVito provides little analysis of the gross negligence exception to liability releases and equally little support to 24 Hour’s position.

A third case cited by 24 Hour is even less helpful. Eastburn, supra, 31 Cal.4th 1175, involved a claim of gross negligence based on a 911 operator putting the plaintiff on hold. An injured child and her parents sued, contending that the child suffered injuries because of the failure to provide prompt emergency response to [***28] the 911 call. (Id. at p. 1179.) Our high court affirmed the trial court’s finding that the plaintiffs would be unable to allege gross negligence to amend their defective complaint. (Id. at pp. 1179, 1185-1186.) On this point, the court wrote: “Plaintiffs’ briefs before the Court of Appeal made the additional allegation that the 911 dispatcher put them ‘on hold’ during their telephone conversation, but such conduct would hardly amount to gross negligence or bad faith. The case law has defined gross negligence as ‘”the want of even scant care or an extreme departure from the ordinary standard of conduct.”‘ [Citations.] Nothing in plaintiffs’ pleadings or appellate briefs points to such extreme conduct. Accordingly, the trial court properly sustained the demurrer without leave to amend.” (Id. at pp. 1185-1186.) Eastburn provides no factual analogue suitable for comparison to our case.

At oral argument, in addition to Grebing, supra, 234 Cal.App.4th 631, 24 Hour cited two other recent cases, which we also find distinguishable. In Honeycutt v. Meridian Sports Club, LLC (2014) 231 Cal.App.4th 251 [179 Cal. Rptr. 3d 473], the plaintiff sued a sports club for a knee injury she sustained while attempting a kicking maneuver in a kickboxing class taught by a personal trainer. (Id. at pp. 254-255.) The trainer attempted to correct the plaintiff’s form by holding her kicking leg while he instructed [***29] her how to pivot her planted leg. (Ibid.) To support her claim that the defendant was grossly negligent, the plaintiff presented an expert declaration asserting that “an instructor should not touch the student, and instead should demonstrate and verbalize the maneuver and regress to an easier maneuver if the kick was too difficult for the student’s skills.” (Id. at p. 259.) On appeal from summary judgment in the defendant’s favor, the Court of Appeal reasoned that there was no triable issue of fact as to gross negligence because “[a] mere [*561] difference of opinion as to how a student should be instructed does not constitute evidence of gross negligence.” (Id. at p. 260.) This strikes us as a quintessential case of, at most, ordinary negligence. Unlike our case, there was no evidence that the defendant violated something like an industry standard, or manufacturer’s safety directions or otherwise made an extreme departure from the ordinary standard of conduct.

Defendant also cited Eriksson II, supra, 233 Cal.App.4th 708 at oral argument and ignored Eriksson I. In Eriksson I, the plaintiffs’ daughter was killed in an equestrian mishap. The Court of Appeal reviewed the trial court’s ruling granting summary judgment. Looking at the evidence [***30] in a light most favorable to the plaintiffs, the court concluded that the plaintiffs produced evidence sufficient to support a jury finding [**241] that a riding coach was grossly negligent in persuading the mother to allow her daughter to compete in an equestrian competition on a recently injured and unfit horse. (Eriksson I, supra, 191 Cal.App.4th at p. 857.) Following a remand for trial, the trial court entered judgment after the plaintiffs’ case-in-chief. The trial court found, based on the trial evidence, that the defendant’s conduct did not rise to the level of gross negligence. (Eriksson II, at p. 718.) On review, the Court of Appeal reasoned that because the defendant “established the validity of the release in the sense that it was binding and enforceable against [the plaintiffs],” the plaintiffs then had the burden of establishing that the defendant was grossly negligent in their case-in-chief at trial. (Id. at pp. 733-734.) Based on this procedural posture, the Eriksson II court applied a deferential standard of review (as opposed to the de novo review of the summary judgment in Eriksson I). The court “review[ed] the record to determine whether the evidence establishe[d], as a matter of law” that the defendant was grossly negligent. (Id. at p. 734, italics added.) The court determined [***31] that the plaintiffs failed to meet this burden at trial; however, it did not publish the portion of the opinion analyzing why the trial evidence failed to establish that the defendant was grossly negligent as a matter of law. (Ibid.) Accordingly, the case is of little utility to 24 Hour. In any event, due to the vastly different procedural posture and deferential standard of review, Eriksson II is distinguishable from our case. Indeed, the court in Eriksson I, citing Santa Barbara, noted that in the context of a summary judgment motion, the defendant bears the burden of establishing the validity of a release “as applied to the case at hand.” (Eriksson I, at p. 856, italics omitted, quoting Santa Barbara, supra, 41 Cal.4th at p. 780, fn. 58.) And as we have noted, our high court held that [HN10] a release from liability for gross negligence is invalid and unenforceable. (Santa Barbara, at pp. 750-751.) Thus, the opinion in Eriksson I is far more instructive where the Court of Appeal reversed the summary judgment in the defendant’s favor, reasoning that the plaintiffs showed there were material issues of fact as to whether the defendant was grossly negligent. (Eriksson I, at p. 857.) [*562]

In the trial court, 24 Hour did not explicitly dispute plaintiffs’ separate statement of facts in [***32] its moving papers; instead it opted to object to most of plaintiffs’ facts instead. On appeal, 24 Hour repeatedly disputed plaintiffs’ factual allegations in its brief. Specifically, defendant makes much of the fact that Etelvina cannot remember her fall, contending there is no “evidence that she actually fell backwards off of a moving treadmill.” However, this argument ignores plaintiffs’ expert declarations opining what likely happened to Etelvina based on her injuries, the location of her fall, and accident reconstruction. Although 24 Hour’s factual presentation in its briefing does not view the facts in the light most favorable to plaintiffs, we must do so. And while the experts’ opinions may or may not be credible at trial, this is an inherently factual issue for a jury to decide.5

5 24 Hour notes its objections to plaintiffs’ evidence and contends that these expert opinions are inadmissible. However, the trial court overruled 24 Hour’s evidentiary objections, and 24 Hour does not challenge this ruling on appeal. Accordingly, this argument is forfeited. (Salehi v. Surfside III Condominium Owners Assn. (2011) 200 Cal.App.4th 1146, 1161-1162 [132 Cal. Rptr. 3d 886].)

[**242] We emphasize that “we are not passing judgment upon the merits of plaintiffs’ allegations; rather, we are viewing the allegations [***33] in the light most favorable to plaintiffs, as required by the law.” (Rosencrans, supra, 192 Cal.App.4th at p. 1089.) A jury may very well conclude that Etelvina was not injured in the manner alleged, that there was no industry standard on treadmill safety clearances, and that 24 Hour’s conduct did not rise to the level of gross negligence, but we are unwilling to reach these conclusions as a matter of law based on the record before us. In a case involving disputes of fact such as how and where Etelvina fell and whether there is an industry standard on treadmill safety zones, summary judgment is a “drastic remedy.” (Mateel Environmental Justice Foundation v. Edmund A. Gray Co. (2003) 115 Cal.App.4th 8, 17 [9 Cal. Rptr. 3d 486].) Accordingly, we conclude that the trial court erred in ruling that plaintiffs did not present a triable issue of fact regarding whether 24 Hour engaged in gross negligence.

III. Fraud and Misrepresentation

A. The Parties’ Contentions

Plaintiffs contend that there are triable issues of fact as to whether 24 Hour obtained Etelvina’s signature on the liability release through fraud and misrepresentation, which would invalidate the release as to all of plaintiffs’ theories of recovery. In the trial court, plaintiffs presented the declarations of Etelvina and her sister, another 24 Hour member, testifying that before they [***34] signed their respective releases, the 24 Hour employees misrepresented and concealed the contents of the agreements. Specifically, Etelvina declared that [*563] Wilbourn gestured and pointed to represent that the agreement was to pay a certain amount of money per month for the gym membership and that she relied on that representation when she signed the release. However, the trial court ruled that plaintiffs presented “no evidence that Mr. Wilbourn made any affirmative representations that led [Etelvina] to believe she was signing something other than what the agreement, on its face, purported to be.”

On appeal, plaintiffs argue that 24 Hour failed to conclusively establish the enforceability of the release because they produced evidence that Wilbourn did not act in good faith and made affirmative misrepresentations to Etelvina through nonverbal gestures and by pointing to the monthly payment amount on his computer screen. Additionally, plaintiffs point out Wilbourn violated his own policy as the membership manager of referring Spanish-speaking customers to sign up with Spanish-speaking employees.6 24 Hour responds that it owed no duty to translate or explain the agreement to Etelvina, and [***35] the material facts alleged by plaintiffs do not raise a triable issue of whether Wilbourn misrepresented the contents of the agreement.

6 Plaintiffs repeatedly refer to this as a 24 Hour policy, but citations to Wilbourn’s deposition reveal that the questions directed toward him and his answers related to what he did and his habit and custom.

B. Analysis

(4) ” [HN11] A release may negate the duty element of a negligence action.” (Benedek v. PLC Santa Monica (2002) 104 Cal.App.4th 1351, 1356 [129 Cal. Rptr. 2d 197].) As we have noted, in order to absolve itself of responsibility for any ordinary negligence, it was 24 Hour’s burden to establish the validity of the release “as [**243] applied to the case at hand.” (Santa Barbara, supra, 41 Cal.4th at p. 780, fn. 58; see Eriksson I, supra, 191 Cal.App.4th at p. 856.)

Generally, a person who signs an instrument may not avoid the impact of its terms on the ground that she failed to read it before signing. (Randas, supra, 17 Cal.App.4th at p. 163.) However, a release is invalid when it is procured by misrepresentation, overreaching, deception, or fraud. (Ibid.) “It has often been held that if the releaser was under a misapprehension, not due to his own neglect, as to the nature or scope of the release, and if this misapprehension was induced by the misconduct of the releasee, then the release, regardless of how comprehensively worded, is binding only to the extent actually [***36] intended by the releaser.” (Casey v. Proctor (1963) 59 Cal.2d 97, 103 [28 Cal. Rptr. 307, 378 P.2d 579], fn. omitted.) “In cases providing the opportunity for overreaching, the releasee has a duty to act in good faith and the releaser must have a full understanding of his legal rights. [Citations.] Furthermore, it is the province of the jury to determine whether the circumstances afforded the opportunity for overreaching, whether the releasee [*564] engaged in overreaching and whether the releaser was misled. [Citation.]” (Frusetta v. Hauben (1990) 217 Cal.App.3d 551, 558 [266 Cal. Rptr. 62] (Frusetta).) A “strong showing of misconduct” by the plaintiff is not necessary to demonstrate the existence of a triable issue of fact here; only a “‘slight showing'” is required. (Id. at pp. 559-560.)

(5) Here, if a jury were to be persuaded that Wilbourn made misrepresentations to Etelvina about the contents of the agreement by making nonverbal gestures indicating that what she was signing related only to being allowed to exercise if she paid the price on the computer screen, it would be entitled to find that Etelvina’s signature on the release was produced by misrepresentation and that the release is not enforceable against her. (See Seeger v. Odell (1941) 18 Cal.2d 409, 414 [115 P.2d 977] [one [HN12] who has been induced by fraudulent misrepresentations to sign agreement is entitled to have agreement set aside]; Blankenheim v. E. F. Hutton & Co. (1990) 217 Cal.App.3d 1463, 1474 [266 Cal. Rptr. 593] [same]; see [***37] also American T. Co. v. California etc. Ins. Co. (1940) 15 Cal.2d 42, 65 [98 P.2d 497] [“Regardless of whether one is under a duty to speak or disclose facts, one who does speak must speak the whole truth, and not by partial suppression or concealment make the utterance untruthful and misleading.”].) Thus, we must determine whether, with all facts and inferences construed in plaintiffs’ favor, the conduct shown by plaintiffs’ evidence could be found to constitute fraud. If so, then it is a question of fact for the jury to determine whether the release in this case was ineffective.

In Frusetta, a personal injury case, the plaintiff asserted that an insurance adjuster who worked for Twentieth Century Insurance Company told her that a preprinted check was to be a partial payment for injuries she suffered in a car accident, and the adjuster represented to her that another payment would be forthcoming. (Frusetta, supra, 217 Cal.App.3d at p. 554.) The check included the words, “‘Bodily injury in full and final settlement.'” (Ibid.) The reverse of the check stated that if “‘”Full and Final Settlement” is printed on the front of the draft, endorsement of the draft constitutes a full Release of all claims known or unanticipated which the under-signed has or may hereafter have against the Payor … .'” (Ibid.) The plaintiff endorsed [***38] and cashed the check, and Twentieth [**244] Century claimed that by doing so, she released it from any further liability. (Id. at pp. 554-555.) The Frusetta court reasoned, “it is clearly possible that a jury might find the circumstances demonstrated fraud or overreaching on the part of Twentieth Century. If a jury accepted [the plaintiff’s] testimony a Twentieth Century adjuster stated to her the check was a partial settlement and the rest would be paid later, then it might be found Twentieth Century violated its duty to act in good faith.” (Id. at p. 558.) Accordingly, the court held there was a triable issue of fact as to whether “a [*565] fraud or misrepresentation … induced a party’s signing of a release ‘[where] it substantially contribute[d] to his decision to manifest his assent.'” (Id. at pp. 556-557.)

A recent Ninth Circuit case applying California law, Doe v. Gangland Productions, Inc. (9th Cir. 2013) 730 F.3d 946 (Gangland), is also instructive. There, the plaintiff sued two production companies for broadcasting a television documentary without concealing his identity. (Id. at pp. 951-952.) In an anti-SLAPP motion to strike the complaint, among other arguments, the defendants contended that the plaintiff’s claims were barred because he signed a release consenting to disclosure of his real identity in the broadcast [***39] and waiving all claims for liability. (Id. at pp. 957-958.) In order to overcome the anti-SLAPP motion, the plaintiff had to demonstrate a probability of prevailing on the merits of his claims. (Id. at p. 957.) In a declaration, the plaintiff stated that he was dyslexic, illiterate, and that he informed the Gangland producer who asked him to sign the release that he had “‘extreme difficulty reading.'” (Id. at p. 952.) The plaintiff also stated that “when he was provided the alleged release, [the producer] told him it was ‘just a receipt’ for his $300 payment for the interview. Because of these representations, [the plaintiff] did not ask his girlfriend to read out loud the document before he signed it.” (Id. at p. 958.) The court reasoned that the plaintiff “made a sufficient showing of fraud in the execution of the release, which, if true, would render the release void.” (Ibid.)

In reaching its conclusion, the court in Gangland cited Mairo v. Yellow Cab Co. (1929) 208 Cal. 350 [281 P. 66]. In Mairo, the California Supreme Court reviewed a directed verdict in the defendant’s favor, where the trial court concluded that the plaintiff had waived his rights by executing several releases. (Id. at pp. 351-352.) The plaintiff was an illiterate Russian immigrant who understood little spoken English. (Id. [***40] at p. 351.) He was injured after being hit by the defendant’s taxicab and during the course of his medical treatment, the defendant had him sign several releases in exchange for the payment of his medical treatment. (Id. at pp. 351-352.) The plaintiff asserted that the defendant misrepresented the true contents of the releases and that he believed they were merely a permit to operate on him and receipts. (Id. at p. 352.) The court held that if the true nature of the releases was “misrepresented to [the plaintiff] so that he did not know what he was really signing, they are, of course, void. But under the conflicting evidence here it is impossible to tell whether such was the fact. This also was an issue which should have gone to the jury and it was, therefore, erroneous for the trial court to direct said verdict for defendant.” (Ibid.; see Meyer v. Haas (1899) 126 Cal. 560, 562 [58 P. 1042] [holding that a release was void where the releaser could not read English and understood little spoken English, and the releasee “did not convey full information as to [the release’s] contents”].) [*566]

[**245] Defendant dismisses the application of Frusetta and other cases where there was “affirmative misrepresentation or fraud” regarding the nature or character of the document in question, [***41] because here there was no verbal misrepresentation. However, in our view, this is a distinction without a difference. 24 Hour contends that these nonverbal communications cannot, as a matter of law, amount to affirmative misrepresentations because Etelvina “could not reasonably have relied upon anything Mr. Wilbourn said” since he spoke a different language. 24 Hour’s argument implies that nonverbal communications cannot be misrepresentative or induce reasonable reliance. We reject this argument. While it may be less reasonable for a plaintiff to rely on nonverbal communications in a case where the parties speak the same language, in this case, gesturing was virtually the only form of communication between Wilbourn and Etelvina. It is undisputed that Etelvina did not speak English and Wilbourn did not speak Spanish. Further, Wilbourn knew Etelvina did not speak or read English. And he knew that Etelvina did not read the contract, including the terms setting forth the release, even though, as the membership manager, he must have known that the release says, “By signing below, you acknowledge and agree that you have read the foregoing …” provisions of the release. (Italics added.) Under [***42] these circumstances, already ripe for misrepresentation and overreaching, Wilbourn’s gestures and pointing may very well have misrepresented the nature of the document Etelvina signed. This is an inherently factual question for a jury to decide. (See Jordan v. Guerra (1943) 23 Cal.2d 469, 475 [144 P.2d 349] [“[I]t [HN13] is for the trier of the facts to determine what the plaintiff understood was covered by the writing and whether his understanding different from the writing was induced by the defendant.”].)

24 Hour relies heavily on Randas, supra, 17 Cal.App.4th 158, arguing that under Randas, a case involving a release signed by a person who did not speak English, it had no duty to translate or explain the membership agreement to Etelvina and that Etelvina had no one to blame but herself. Randas does not help 24 Hour because there was no claim of fraud or overreaching in that case and the releasee had no reason to think the releaser could not read the release. Indeed, the Randas court made a point of those circumstances, specifically noting, “Appellant made no claim of respondent’s fraud or overreaching. Nor did appellant claim that respondent had reason to suspect she did not or could not read the release she had signed and which in full captions above and below her signature stated: [***43] ‘I Have Read This Release.'” (Id. at p. 163.) Here, plaintiffs’ theory is fraud and overreaching. And it is clear that Wilbourn knew Etelvina could not and did not read the release.

Accordingly, we reverse the trial court’s ruling on this basis as well. [*567]

IV. Foreseeability That 24 Hour Would Intentionally Increase the Risk of Danger

On appeal, plaintiffs also contend that the release is unenforceable because a release only encompasses risks that are foreseeable at the time it is signed, and it was not reasonably foreseeable that 24 Hour would intentionally increase the risk of danger to its treadmill users. However, plaintiffs did not pursue this argument below in either their opposition to the summary judgment motion or during oral argument on the motion. Additionally, plaintiffs did not allege that 24 Hour engaged in intentional conduct in their complaint or raise undisputed facts pertaining [**246] to this foreseeability theory in their separate statement of facts. Accordingly, we decline to consider this argument for the first time on appeal. (See Greenwich S.F., LLC v. Wong (2010) 190 Cal.App.4th 739, 767 [118 Cal. Rptr. 3d 531] [reasoning that [HN14] generally, theories not raised in the trial court cannot be asserted for the first time on appeal, particularly where it is unclear whether [***44] the theory raises a pure question of law].)

DISPOSITION

The judgment is reversed. 24 Hour shall pay plaintiffs’ costs on appeal. (See Cal. Rules of Court, rule 8.278(a)(1) & (5).)

Blease, Acting P. J., and Hull, J., concurred.


Do you have contracts with all of your athletes? Manufacturers who provide more than swag to athletes may be sued without a written agreement.

In this case the manufacturer one because the damages were not able to be proven, however, this is just the tip of the iceberg on what could happen. What if the rider was injured, and you were their largest contributor to their income?

Rogatkin v. Raleigh America Inc., 69 F. Supp. 3d 294; 2014 U.S. Dist. LEXIS 164154

State: Massachusetts, UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MAS-SACHUSETTS

Plaintiff: Nicholi Rogatkin, Minor by His Father and Next Friend, Vladmir Rogatkin

Defendant: Raleigh America Inc./Diamondback BMX, and John Does 1-8

Plaintiff Claims: : unauthorized use of name and portrait or picture in violation of Mass. Gen. Laws ch. 214 § 3A (Count I); unfair and/or deceptive business practices in violation of Mass. Gen. Laws ch. 93A, §§ 2 & 11 (Count II); defamation (Count III); negligent misrepresentation (Count IV); unjust enrichment (Count V); promissory estoppel (Count VI); and intentional misrepresentation (Count VII).

Defendant Defenses: No evidence and No damages

Holding: for the defendant

Year: 2014

The plaintiff was a very talented BMX rider starting at a very early age. The defendant started sponsoring him at age 11 in 2007. That sponsorship continued for five years until 2012 when the plaintiff moved on to another sponsorship. During that time, the sponsorship started as a bike and other equipment and grew to a monthly income and travel expenses. During that time the plaintiff wore the defendant’s logos and sent photographs and videos to the defendant to be used on their website.

The plaintiff one year flew out to the defendants, at the defendant’s expense to be photographed for the defendant’s catalog. The defendant started asking for in 2010 and was told that he had a great career ahead of him.

Prior to receiving income, the plaintiff and defendant did not have any contract between them. Once the defendant started receiving a monthly income the plaintiff signed a Team Rider Sponsorship Agreement. The agreement was signed by the plaintiff’s father on behalf of the plaintiff. The agreement provided the plaintiff with a monthly payment, and the defendant got unlimited promotional use of the plaintiff’s name and likeness.

At no time, was the plaintiff restricted from receiving sponsorship from other manufacturers. Eventually, the plaintiff was picked up by other manufacturers, including other bike manufacturers. Eventually, he went to one of the manufacturers as a high-paid rider and left the defendant. Soon thereafter the plaintiff, by and through his father, sued the defendant. The claims total seven counts.

unauthorized use of name and portrait or picture in violation of Mass. Gen. Laws ch. 214 § 3A (Count I);

unfair and/or deceptive business practices in violation of Mass. Gen. Laws ch. 93A, §§ 2 & 11 (Count II);

defamation (Count III);

negligent misrepresentation (Count IV);

unjust enrichment (Count V);

promissory estoppel (Count VI);

and intentional misrepresentation (Count VII).

Basically, the plaintiff sued to get more money believing that he was not compensated enough by the defendant for his work prior to leaving. He did not win any of these arguments. The judge granted the defendants motion for summary judgment.

Analysis: making sense of the law based on these facts.

The decisions starts with an analysis of the defamation claim. To prove defamation on Massachusetts law the plaintiff must prove:

…the defendant was at fault for the publication of a false statement regarding the plaintiff, capable of damaging the plaintiff’s reputation in the community, which either caused economic loss or is actionable without proof of economic loss.

The plaintiff based his claims on the theory that the defendant did not change the photos on its website fast enough to match the growth of the plaintiff and his riding larger bikes. For a year or so after he had advanced from a 16” (wheel size) bike to 18” then 20” bikes he was pictured on the website riding 16” bikes.

Although Rogatkin admits that the accused material was accurate and non-defamatory when published, he contends that as he grew in age and skill, his static portrayal by Raleigh took on a defamatory undertone.

Because the information was valid at the time it was posted, and the plaintiff’s date of birth was on the site, the court found no major issue with not changing photographs as quickly as the plaintiff wanted. The court even had fun with this argument.

Although Raleigh did not update Rogatkin’s biography with the march of time (the court knows of no duty the law imposes to do as much), it published Rogatkin’s accurate date of birth on the same page — a reasonable assurance that the public would never confuse Rogatkin with, say, Peter Pan or Benjamin Button.

More importantly the plaintiff could not offer any evidence showing that by failing to change the photographs, he had suffered an injury.

A false statement is defamatory if it “would tend to hold the plaintiff up to scorn, hatred, ridicule or contempt, in the minds of any considerable and respectable segment in the community

The court then had fun and brought in Shirley Temple in its analysis of the negative publicity claimed by the plaintiff.

The publication of Rogatkin’s age (12) and characterizing him as a “kid” in a biography is no more susceptible to a defamatory meaning than biographical references to Ambassador Shirley Temple as a child actor or as “America’s Little Darling.

A biography, like a photograph, is a faithful snapshot of a person taken at a particular time in his or her life.

The court also looked at the argument made by the plaintiff as one of not suffering injury from not showing him riding larger bikes, but of failing to post more images of him on larger bikes, which could not be actionable.

Rogatkin alleges that Raleigh’s continued publication of images of him as a 16-inch bike rider led to ridicule and scorn because he was not shown riding a larger bike. This is not an objection to the publications, but to the lack of publication of photos showing Rogatkin riding larger bikes. Rogatkin has not identified any support for the novel proposition that the absence of publication may form the basis of a defamation claim.

The court then looked at the first count, unauthorized use of the name and image of the plaintiff.

The statute at issue allows a private right of action when an image had been used for commercial advertising without the consent of the person. The defendant argued that the emails between them showed consent to use the images. The court agreed.

…Rogatkin does not disagree that he condoned Raleigh’s use of his name and images for purposes of advertising at the time of publication, or that he attended the various photo shoots (such as the one in Seattle in 2008) with any expectation other than that his name and image would be used by Raleigh to promote sales of its bikes.

The court also brought up the fact the emails from the plaintiff complained they were not posting enough photographs of him on the defendant’s website. Again, the plaintiff could not show any damages from the posting of his images. Just because Raleigh made money from using his injuries is not damages for injury upon the plaintiff. “Because Rogatkin has adduced no material evidence of damages attributable to the use of his name and image, Raleigh is entitled to summary judgment on Count I.”

Next the court took on claims IV, VI and VII, Intentional/Negligent Misrepresentation, and Promissory Estoppel.

Under Massachusetts’s law to win a claim of misrepresentation, the plaintiff had to show false statement that induced him to do something.

To sustain a claim of misrepresentation, a plaintiff must show a false statement of material fact made to induce the plaintiff to act, together with reliance on the false statement by the plaintiff to the plaintiff’s detriment. . . . The speaker need not know ‘that the statement is false if the truth is reasonably susceptible of actual knowledge, or otherwise expressed, if, through a modicum of diligence, accurate facts are available to the speaker.’

However, even if the defendant had made a false representation, the plaintiff had to prove he was worse off based on the false representation.

…a plaintiff must allege that (1) a promisor makes a promise which he should reasonably expect to induce action or forbearance of a definite and substantial character on the part of the promisee, (2) the promise does induce such action or forbearance, and (3) injustice can be avoided only by enforcement of the promise.

The plaintiff could have rejected the sponsorship from the defendant, and the plaintiff was free to contract with other manufacturers for sponsorship.

On top of that, the plaintiff could not prove a promissory estoppel claim because he could not prove any terms or elements to create a legal claim.

Under Massachusetts law, “as with a claim for breach of contract, [i]n order to establish the existence of an enforceable promise under promissory estoppel, the plaintiff must show that the defendants’ promise included enough essential terms so that a contract including them would be capable of being enforced.”

Count V, unjust enrichment was reviewed by the court next.

The plaintiff claimed that the defendant unfairly profited from his work and photographs by paying him minimally. To prove an unjust enrichment claim the plaintiff must show:

(1) a benefit conferred upon the defendant by the plaintiff;

(2) an appreciation or knowledge of the benefit by the defendant; and

(3) the acceptance or retention of the benefit by the defendant under circumstances which make such acceptance or retention inequitable.

Damages from an unjust enrichment claim are the disgorgement of the property unjustly appropriated.

Because unjust enrichment is a theory of equitable recovery, and not a separate cause of action, a court may not order restitution as a form of damages; it may only require a party to disgorge property that has been wrongfully appropriated from the rightful possession of the other party.

First because the relationship between the parties was voluntary there were no fraud or “unjust” actions by the defendant. On top of that, the plaintiff benefited from the relationship just as the defendants did.

He also benefited materially from the relationship in terms of equipment, gear, and travel expenses. If Rogatkin found the terms of his association with Raleigh unsatisfactory, he was free to renegotiate, or leave to pursue other opportunities (both of which he eventually did). Because Raleigh did not unfairly retain any benefit conferred by Rogatkin,….

Here again, the plaintiff could show no damages nor could he even show injury in this case.

The court looked at Count II then, Unfair and/or Deceptive Business Practices under Chapter 93A, a Massachusetts statute.

Here again, the plaintiff did not successfully argue this claim because he could not prove that the defendant was unethical, unscrupulous and a fraud.

Rogatkin has not shown that Raleigh’s actions fell within “the penumbra of some common-law, statutory, or other established concept of unfairness . . . or [was] immoral, unethical, oppressive or unscrupulous . . . [or] cause[d] substantial injury to consumers (or competitors or other businessmen).

These arguments were all based in fraud or contract. In all cases, the damages cannot be what the defendant got from third parties but what it cost the plaintiff in dealing with the defendant. Here the plaintiff could not show any damages that qualified, in fact, the court found the plaintiff had benefited from the relationship and at worse was a bad negotiator.

So Now What?

Once you put someone’s image on your website or your give something, specifically to someone based upon their relationship with your product you better have that relationship in writing.

Once you hand product to someone to sue in an effort to promote your product and create a long-term relationship with that person that is not defined by other facts, such as product testers, writers, reviewers, etc., you might look at immortalizing that relationship in writing.

Most states have laws concerning the unauthorized use of someone’s likeness without their permission. That is an easy reason to see why you should have an agreement.

The facts here are another reason. A written contract outlining the relationship from the beginning would have eliminated this lawsuit.

However, this can get worse.

The IRS wants to know what your relationship is. Without an agreement, the IRS is free to determine that relationship on its own with little help. (Although a contract is not persuasive, it helps when dealing with the IRS.) If the sponsored athlete is only sponsored by you and uses your equipment and does not pay taxes, the IRS can look to you for failing to pay withholding for the “employee.” The IRS wants it money and will work hard to get it from anyone who can write a check easily.

Another group that wants money is the athlete’s health insurance carrier or the unpaid hospital and doctors if the athlete does not have any insurance. The health insurance carrier through its subrogation clause can look to anyone it believes is legally responsible for the damages it paid out for the injured athlete’s medical bills. The insurer may see the action as the same way the IRS does; the injured athlete was an employee and should have been covered under your worker’s compensation insurance. A successful lawsuit on this issue will not only cost you money in paying the health insurance company, but double more for penalties to your worker’s comp carrier for not listing the athlete.

The health insurance carrier could also come after you if it believes the bike or another product was defective. Again, a contract with the athlete would eliminate both arguments.

Unpaid medical bills can also trigger claims based on either an employee theory or on the legal theory that you were legally responsible for encouraging the athlete.

It is easy to get these contracts written. You need to specify general issues like medical coverage, health insurance, taxes and the legal definition of the parties and that relationship. More importantly you need to define what you are going to do and all limits to that relationship so that no matter who or what, they cannot exceed the limits placed in the agreement.

You want to get your product out there, and you want to help up-and-coming athletes. However, taking the time to establish legally the relationship will make everyone’s life easier from the start.

Who knows, fifty years from now, that signature on an athlete’s first contract might have value in itself.

What do you think? Leave a comment.

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Is your local race a fund-raiser for a charity or an event for an out of state corporation? This lawsuit might decide

Lawsuit claims that race organizer; make money from volunteers and volunteers should be paid. Entire US race and event “business” could change or disappear.

Most events that we love to participate in, attend or watch are owned by for-profit corporations. They make money for a business. Those events are dependent upon hundreds if not thousands of volunteers. Many state or imply a charity, whose name is in the title of the event is the reason for the event, and thus the volunteers are working for the charity.

This lawsuit says that is not quite so. In fact, this lawsuit says most of what I believed and probably a lot of what you believe about these events are not true.

The lawsuit on its face says that the volunteers at these events were misled and should have been paid. On its face, it’s hard to ask for money when you sign up as a volunteer. You agree to volunteer and you are a volunteer, and you don’t get paid.

However, that is not the bottom line here. Based on the article:

·         The entire operation is fraudulent.

·         The volunteers were recruited to provide community service when, in fact, they were not, they were working for a for-profit corporation, not a charity.

·         Charities pay to have their name attached to the event.

·         The more a charity pays, the more the charity is recognized by the event.

·         Teams that raise money for these events Charites, the base money goes to the event, and only the money raised over the minimum goes to the charity.

·         The event then uses the charities name to recruit volunteers for the event.

Is the plaintiff going to win the lawsuit? I have no idea, but allegations of fraud change litigation, throw out the normal defenses and generally create a different courtroom drama. It is never good to be defending someone who looks bad.

However, the major impact may have already occurred. Will people volunteer to sign up for these events as volunteers? Will charities continue to associate with these events and will those charities be linked with the fraud or for the good they do?

Without the thousands of volunteers, these events won’t happen. Entry fees will either skyrocket or go away. Charities may no longer be associated with any of these events because they are simply bad news.

However, I think this lawsuit may have a chance; the plaintiff is an associate professor at the Saint Louis University School of Law.

The damage is already done. Those races and events that have been upfront from the beginning are not going to be affected except by a few volunteers who are not paying attention or confused. However, the big events which rely on thousands of volunteers are either going to change, evolve or go away.

See Lawsuit alleges CGI exploited race volunteers and This Marathon Lawsuit May Shake Up the Running World

What do you think? Leave a comment.

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