Park v. Cytodyne Technologies
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
JASON A. PARK et al.,
Plaintiffs and Respondents,
CYTODYNE TECHNOLOGIES, INC.,
Defendant and Appellant.
APPEAL from a judgment of the Superior Court of San Diego County, Ronald Styn, Judge. Reversed and remanded with directions.
Pending resolution of this appeal, the parties settled the action and filed a Joint Application For Order Transferring Jurisdiction Over Matter to Trial Court to Vacate Judgment. By letter to this Court dated
Code of Civil Procedure section 128, subdivision (a)(8) provides, in part: " An appellate court shall not reverse or vacate a duly entered judgment upon an agreement or stipulation of the parties unless the court finds both of the following:
" (A) There is no reasonable possibility that the interests of nonparties or the public will be adversely affected by the reversal.
" B) The reasons of the parties for requesting reversal outweigh the erosion of public trust that may result from the nullification of a judgment and the risk that the availability of stipulated reversal will reduce the incentive for pretrial settlement."
This Court finds the conditions for a stipulated reversal have been satisfied and we therefore reverse the judgment and remand the matter to the trial court with directions to dismiss the action with prejudice.
This action is an unfair competition (Bus. & Prof. Code, § 17200) and false advertising (Bus. & Prof. Code, § 17500) class action regarding the dietary supplement Xenadrine RFA-1. The class consists of persons in
The settlement agreement covers this appeal and certain bankruptcy proceedings. It provides Nutraquest will pay a maximum of $8 million toward the claims of the class members, who will receive up to $11.88 each; $20,000 to Park; the costs of notice and administration of the settlement; and $4.5 million in attorney fees and costs. The settlement agreement does not include injunctive relief. The agreement also states Nutraquest may apply to the superior court and this court for vacation of the judgment, " conditioned and effective upon consummation of this [s]ettlement and the [reorganization p]lan becoming effective," and Park " agrees to join in [the] application . . . so long as: (i) the application is in substantially the same form as the form of application provided to Park['s c]ounsel prior to execution of this [a]greement; and (ii) the settlement of the NAPA Action, the Markowitz Settlement, and/or an FTC [Settlement] afford protections to California consumers and Park Class Members that are equal to or greater than the protections afforded by the injunctive relief provided in the Park Judgment." 
On October 12, 2006, the district court issued a final order and judgment incorporating and approving the parties' May 22 settlement agreement, certifying the class, stating the district court had exclusive and continuing jurisdiction to enforce the final order and judgment, and stating that if the proposed settlement did not become effective or was voided in accordance with the terms of the settlement agreement, the final order and judgment would be vacated. On November 3, the district court confirmed Nutraquest's third modified reorganization plan.
The parties have advised this court that all conditions to the stipulated request for reversal have been satisfied.
Section 128, subdivision (a)(8) provides, in part: " An appellate court shall not reverse or vacate a duly entered judgment upon an agreement or stipulation of the parties unless the court finds both of the following: [¶] (A) There is no reasonable possibility that the interests of nonparties or the public will be adversely affected by the reversal. [¶] (B) The reasons of the parties for requesting reversal outweigh the erosion of public trust that may result from the nullification of a judgment and the risk that the availability of stipulated reversal will reduce the incentive for pretrial settlement." " The parties must . . . submit memoranda of points and authorities and declarations and other documentary evidence persuasively demonstrating that reversal of the judgment in question will not adversely affect nonparties or the public, erode public trust, or reduce the incentive for pretrial settlement . . . ." (Hardisty v. Hinton & Alfert (2004) 124 Cal.App.4th 999, 1007, as mod.
Here, the parties note the Markowitz settlement was supervised by the district court and provides monetary relief for persons who purchased Xenadrine RFA-1 between
Nutraquest filed its bankruptcy petition after entry of the judgment. The parties observe the settlement agreement " is a part of the District Court's substantial efforts on behalf of a nationwide bankruptcy that resolves creditor claims from all over the country." The district court expressly found the settlement agreement was entered into in good faith and treated class members equitably, and the contributions to the settlement by Nutraquest and on its behalf amounted to more than its net worth. Considering these facts, we conclude " [t]he reasons of the parties for requesting reversal outweigh the erosion of public trust that may result from the nullification of a judgment and the risk that the availability of stipulated reversal will reduce the incentive for pretrial settlement." (§ 128, subd. (a)(8)(B).) " When lawyers responsibly settle litigation, public trust in the courts is advanced. Hence, in exercising discretion on a case-by-case basis in evaluating whether the three factors in section 128, subdivision (a)(8) are present, it is relevant that reversible error occurred but it is not a prerequisite to the judicial acceptance of a stipulated reversal in a case such as this . . . ." (Union Bank of
Based on the stipulation of the parties under section 128, subdivision (a)(8), the judgment is reversed and the case is remanded to the trial court with directions to dismiss the action with prejudice. The remittitur shall issue immediately. Each party shall bear its own costs on appeal.
McDONALD, Acting P. J.
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 All statutory references are to the Code of Civil Procedure unless otherwise specified.
 The money judgment is composed of the following approximate amounts: $12.5 million in principal, $5 million in attorney fees, $155,500 in statutory costs, and $445,000 in nonstatutory costs, all to Jason Park as class representative, and $20,000 to Park individually.
 The district court withdrew its reference to the bankruptcy court.
 The Markowitz settlement refers to Nutraquest's settlement, in the context of the bankruptcy proceedings, of another class action. That class consists, in part, of all persons who purchased Xenadrine RFA-1 in the
The Napa action refers to a stipulated judgment, including injunctive relief against representations about weight-loss products, in an action brought against Nutraquest in
Finally, according to the parties here, a settlement was negotiated between staff of the Federal Trade Commission, representatives of Nutraquest's officers, and an affiliated entity.