Carter v. Entercom Sacramento, LLC
161 Cal. Rptr. 3d 782
Cal. Ct. App.2013Background
- Carter sought indemnity under Labor Code §2802 for fees after Vigilant appointed counsel for him in the Strange action.
- Carter refused Vigilant-appointed counsel and hired his own attorney, contending he was entitled to indemnity for those fees.
- Trial court found only fees incurred before February 22, 2007 were indemnifiable; post-February 22, 2007 fees were not necessary expenditures.
- Vigilant’s defense of the civil action and potential punitive damages did not create a mandatory conflict requiring independent counsel; no evidence connected the later fees to criminal prosecution.
- Court ultimately affirmed judgment denying indemnity for post-February 22, 2007 fees and rejected quantum meruit.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Carter had an absolute right to counsel of his choosing at employer’s expense. | Carter argues absolute right under §2802 and Civil Code §2778. | Entercom may provide counsel; indemnity not automatic for chosen attorney. | Not absolute; no automatic indemnity for chosen counsel. |
| Whether post-February 22, 2007 expenditures were 'necessary expenditures' under §2802. | Expenditures were necessary due to concerns of punitive exposure and conflicts. | Post-tender expenditures not necessary given Vigilant’s representation. | No substantial evidence of necessity; post-date expenditures not indemnifiable. |
| Whether punitive damages or criminal investigations create a per se right to independent counsel. | Presence of punitive damages/criminal risk justifies independent counsel. | Foremost Ins. Co. v. Wilks shows no automatic conflict; no duty to provide independent counsel. | No per se right; insurer not required to provide independent counsel for punitive or criminal concerns. |
| Whether the trial court erred in denying amendment to add quantum meruit claim. | Fees conferred a direct benefit on Entercom; unjust enrichment. | No statutory duty to indemnify beyond §2802; amendment improper. | Amendment properly denied; no quantum meruit recovery. |
Key Cases Cited
- Grissom v. Vons Cos., Inc., 1 Cal.App.4th 52 (1991) (indemnity may cover independent counsel; necessity is factual and context-driven)
- Foremost Ins. Co. v. Wilks, 206 Cal.App.3d 251 (1988) (no automatic duty to provide independent counsel for punitive-damages claims)
- Cassady v. Morgan, Lewis & Bockius LLP, 145 Cal.App.4th 220 (2006) (indemnity rights are statutory, not contractual; §2802 governs)
- Douglas v. Los Angeles Herald-Examiner, 50 Cal.App.3d 449 (1975) (employer may defend, but indemnity depends on necessity of expenditures)
- Maxwell v. Superior Court, 30 Cal.3d 606 (1982) (right to counsel context; not controlling for indemnity under §2802)