AT&T Mobility, LLC v. Yeager
2:13-cv-00007
| E.D. Cal. | Oct 3, 2018Background
- This is an interpleader action over jury verdict funds won by General Charles Yeager for unauthorized use of his name; multiple former attorneys claimed portions of the funds.
- Parsons Behle & Latimer (through attorney John Zarian) intervened, claiming unpaid fees; Parker White represented the Yeagers later.
- Days before a scheduled fee-dispute trial, Parsons Behle and White exchanged drafts and filed a joint notice of settlement; the court vacated the trial date based on that notice.
- General Yeager later refused to sign the written settlement, asserting he never authorized it; Parsons Behle moved to enforce the settlement and for disbursement of funds.
- An evidentiary hearing addressed whether White had express authority from General Yeager to bind him; General Yeager did not testify at that hearing and was later appointed a guardian ad litem due to competency concerns.
- The court found the record lacked evidence of express authorization (no written or contemporaneous client communications showing assent), denied Parsons Behle’s motion to enforce, and denied Mrs. Yeager’s premature ex parte disbursement request; remaining fee dispute set for trial.
Issues
| Issue | Plaintiff's Argument (Parsons Behle) | Defendant's Argument (Yeagers / Mrs. Yeager) | Held |
|---|---|---|---|
| Whether White had authority to bind Gen. Yeager to settlement | White’s negotiations and joint notice reflected an agreed settlement; Yeagers’ inaction after trial vacatur implies assent | Gen. Yeager never authorized settlement; neither he nor Mrs. Yeager consented or were notified of material terms | Denied — no evidence of express authorization; settlement unenforceable |
| Whether attorney’s general representation gave implied authority to settle | Implied authority or conduct (vacated trial, lack of objection) supports enforceability | California law requires specific, express client authorization to settle | Denied — implied authority insufficient under California law |
| Whether the settlement included a material release affecting malpractice claims and thus required explicit consent | Settlement terms were agreed among counsel and included release; thus binding | Guardian ad litem and Yeagers say they were never informed of general release that would waive malpractice claims | Court finds material release a significant term not shown to have been explained to or authorized by client; supports unenforceability |
| Whether any portion of interpleaded funds should be disbursed immediately to Mrs. Yeager | Settlement and conduct justify partial disbursement to Parsons Behle; Mrs. Yeager seeks partial distribution to herself | Distribution request is premature; outstanding disputes over entitlement remain and dispositive-motion deadline passed | Denied — premature and procedurally improper; unresolved disputes require trial |
Key Cases Cited
- Callie v. Near, 829 F.2d 888 (9th Cir. 1987) (federal courts may summarily enforce settlement agreements entered in pending litigation under equitable power)
- Levy v. Superior Court, 10 Cal.4th 578 (Cal. 1995) (an attorney must be specifically authorized to settle; settlement is not incidental and requires client knowledge and express consent)
- Blanton v. Womancare, Inc., 38 Cal.3d 396 (Cal. 1985) (no implied or ostensible authority from mere employment to bind client to compromise settlement)