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Civil Case No.

BC 406900

CALIFORNIA COURT OF APPEAL

FOR THE SECOND APPELLATE DISTRICT

DIVISION FOUR

ALAN ROSENBERG, ANNE-MARIE JOHNSON,


KENT MCCORD AND DIANE LADD,

Plaintiffs!Appellants.

SCREEN ACTORS GUILD,

Defendant/Respondent.

From the Superior Court for Los Angeles County


Honorable Judge James C. Chalfant
Los Angeles Superior Court Case No. BC406900

RESPONDENT'S BRIEF

Bingham McCutchen LLP


Daniel Alberstone (SBN 105275)
Roland Tellis (SBN 186269)
Sara Jasper Epstein (SBN 240577)
Fourth Floor, North Tower
1620 26th Street
Santa Monica, CA 90404-4060
Telephone: 310.907.1000
Facsimile: 310.907.2000

Attorneys for Respondent Screen Actors Guild

A173023949.5
TABLE OF CONTENTS

1. INTRODUCTION I
II. STATEMENT OF RELEVANT FACTS 4
A. Events Leading up to Appellants' Filing ofthe Action 4
B. The January 26, 2009 Written Assent... 5
C. Appellants Unsuccessfully Attempt to Enjoin SAG
from Acting Pursuant to the Written Assent... 7
D. SAG Holds a Special Meeting to Reaffirn1 the Acts
Passed by the January 26, 2009 Written Assent.. 8
E. Appellants Unsuccessfully Seek Expedited
"Extraordinary" Writ Review in This Court... 10
F. SAG's Membership Overwhelmingly Votes to Ratify a
New Contract with the AMPTP II
III. THE TRIAL COURT DID NOT ABUSE ITS DISCRETION
IN DENYING APPELLANTS' EX PARTE APPLICATION
FOR A TEMPORARY RESTRAINING ORDER II
A. The Trial Court's Order Did Not "Exceed the Bounds
of Reason" II
B. California Law Authorizes SAG's Enactment of
Bylaws that Govern Voting Procedures 12
C. SAG's Majority-Vote Written Assent Procedure Does
Not Conflict With Section 7211(b) 16
D. The Tasks Accomplished by the Majority-Vote
Written Assent Do Not Conflict With SAG's Bylaws 19
E. Public Policy Weighs Heavily Against Court
Involvement in Internecine Issues 21
F. Appellants' Requested Temporary Restraining Order
Was Flawed 24
IV. THE APPEAL SHOULD BE DISMISSED AS MOOT 25
V. CONCLUSION 31

AI7J023949.5
TABLE OF AUTHORITIES

FEDERAL CASES

Motion Picture & Videotape Editors Guild Local 776, IATSE v. Int'!
Sound Technicians Local 695
800 F.2d 973 (9th Cir. 1986) 22

CALIFORNIA CASES

Allen v. Hotel & Restaurant Employees' Int'I Alliance &


Bartenders' Int'I League
97 Cal. App. 2d 343 (1950) 24

Archdale v. Am. Int'I Specialty Lines Ins. Co.


154 Cal. App. 4th 449 (2007) 30

Association for Los Angeles Deputy Sheriffs v. County of Los


Angeles
166 Cal. App. 4th 1625 (Cal. App. 2d Dist. 2008) 11

Blank v. Kirwan
39 Cal. 3d 311 (1985) 12

Braude v. Havenner
38 Cal. App. 3d 526 (1974) 21, 28

Calif. Trial Lawyers Ass'n v. Superior Court


187 Cal. App. 3d 575 (1986) 22

California Dental Ass'n v. Am. Dental Ass'n


23 Cal. 3d 346 (1979) 21, 22

Californians for Fair Representation-No on 77 v. Superior Court


138 Cal. App. 4th 15 (2006) 28

Chantiles v. Lake Forest II Master Homeowners Ass'n


37 Cal. App. 4th 914 (1995) 28

Chernett v. Jacques
202 Cal. App. 3d 69 (1988) 25

Colburn Biological Inst. v. Shaffer


12 Cal. 2d 168 (1938) 15
TABLE OF AUTHORITIES
(continued)

Conservatorship of Wendland
26 Cal. 4th 519 (2001) 28

Con!'1 Baking Co. v. Katz


68 Cal. 2d 512 (1968) 24

Daily Journal Com. v. County of Los Angeles


172 Cal. App. 4th 1550 (Cal. App. 2d Dist. 2009) 25,27

Dominguez v. Superior Court


139 Cal. App. 3d 692 (1983) 30

Downtown Palo Alto Com. for Fair Assessment v. City Council


180 Cal. App. 3d 384 (1986) 25

Envtl. Charter High School v. Centine1a Valley Union High School


Dist.
122 Cal. App. 4th 139 (Cal. App. 2d Dist. 2004) 28

Giles v. Horn
100 Cal. App. 4th 206 (2002) 27,29

Haynes v. Annandale Golf Club


4 Cal. 2d 28 (1935) 21

Jennings v. Strathmore Public Util. Dist.


102 Cal. App. 2d 548 (1951) 27

Kurz v. Fed. of Petanque U.S.A.


146 Cal. App. 4th 136 (2006) 22

Marriage of Varner
55 Cal. App. 4th 128 (1997) 12

MHC Operating Ltd. P'ship v. City of San Jose.


106 Cal. App. 4th 204 (2003) 29

Oakland Raiders v. Nat'! Football League


131 Cal. App. 4th 621 (2005) 22

People v. Garde1ey
14 Cal. 4th 605 (1996) 19

111

A!73023949.5
TABLE OF AUTHORITIES
(continued)

People v. Travis
139 Cal. App. 4th 1271 (2006) 28

Robbins v. Superior Court


38 Cal. 3d 199 (1985) 12

Salazar v. Eastin
9 Cal. 4th 836 (1995) 12

Stewart v. Superior Court of San Diego County


100 Cal. 543 (1893) 24

Walker v. Superior Court


53 Cal. 3d 257 (1991) 12

White v. Davis
30 Cal. 4th 528 (2003) 28

Williams v. Inglewood Bd. of Realtors. Inc.


219 Cal. App. 2d479 (1963) 15, 21

CALIFORNIA STATUTES

Business & Professions Code § Inoo 7, 8

Civil Code § 2313 29, 30

Corporations Code § 307 17, 18

Corporations Code § 307(b) 18

Corporations Code § 7150 13,14

Corporations Code § 7150(c) 13

Corporations Code § 7151 13, 16

Corporations Code § nIl 17

Corporations Code § nIl (a)(8) 18, 26

Corporations Code § nll(b) passim

Corporations Code § n20 13, 14

IV

A173023949.5
TABLE OF AUTHORITIES
(continued)

Corporations Code § 7224 13

Corporations Code § 7512 13

Corporations Code § 7613 13

Corporations Code § 7615 13

OTHER AUTHORITIES

13 Cal. Law Revision Comm'n Reports, Recommendations and


Studies 2201, 2228 (1976) 18

3-19 Ballantine and Sterling California Corporation Laws (2008) §


405.02[1] 14, 15

3-19 Ballantine and Sterling California Corporation Laws §


404.04[1] 21

Notes of Decisions No.2, Deering's Ann. Cal. Corps. Code. § 7151


(2008) 15

v
A173023949.5
I. INTRODUCTION

Appellants ask this Court to do as they say, but not as they do.

Respondent Screen Actors Guild ("SAG") and its members are governed by

SAG's duly-enacted Constitution and Bylaws. For decades, that

Constitution and Bylaws have permitted the use of a "written assent"

procedure allowing SAG's governing Board of Directors to take action

without a meeting, so long as the Board action was supported by a majority

vote. Indeed, during the presidency oflead Appellant Alan Rosenberg and

the vice-presidency ofAppellant Ann-Marie Johnson, SAG's Board has

utilized, without objection, the majority-vote "written assent" procedure on

numerous occasions. So what changed? In a nutshell, Appellants found

themselves on the losing side of a majority-vote. Their candidate for

SAG's leadership was not supported by the majority of SAG's Board, and

they refused to accept defeat. Appellants filibustered a Board meeting vote,

and so SAG utilized its long-standing, majority-vote written assent

procedure. Appellants now claim on appeal that the lack of a Board

meeting renders SAG's majority-vote "written assent" election process

invalid. In doing so, Appellants urge this Court to disregard a decades-

long, accepted practice explicitly permitted by SAG's governing

documents, and would require SAG to adopt inapplicable provisions of the

California Corporations Code. Moreover, Appellants apparently choose to

ignore the fact that the identical acts passed by the contested written assent

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were subsequently reaffirmed and readopted by a majority of SAG's Board

at a duly held meeting, at which every member of the Board was

represented. Settled Califomia law and public policy weigh heavily against

this Court's involvement in this intemecine feud.

Appellants contend that California law prohibits SAG from acting by

majority written assent in accordance with its longstanding Bylaws and

Constitution (see Appellants' Opening Brief ["AOB"], at p. 2)-even

though Appellants themselves have utilized the exact same procedure on

numerous occasions. Appellants further contend that this appeal presents

"a critical question of first impression in the courts of the state" that will

"provide guidance ... for all California corporations and for all future cases

involving such corporations." (AOB, at p. 21.) Appellants are wrong on

both counts.

First, SAG's Board consists of71 members, who reside in different

states and who collectively represent the diverse interests of SAG's

approximately 120,000 members. Appellants' proposed interpretation of

California Corporations Code Section 7211 (b) would prevent the Board

from taking any action in the absence of a formal meeting unless all 71

members of the Board reached unanimous agreement. Appellants' position

is not only contrary to a straightforward reading of Section 7211 (b) and its

greater statutory scheme but would effectively paralyze SAG's goveming

body and cripple its ability to efficiently make decisions, given the unique

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size and structure of its Board. Indeed, it was SAG's choice to avoid the

unanimous written consent procedure suggested by Section 7211 (b) by

instituting a majority-vote provision in its Bylaws and Constitution that

would better suit its needs.

Appellants' proposed rigid interpretation of Section 7211 (b) finds no

support in California law or public policy. Not only has our Legislature

made clear that strong principles of corporate self-determination lay at the

heart of the Califomia Corporations Code, but our Courts have similarly

been loath to interfere in the corporate sphere.

Second, contrary to Appellants' elevated rhetoric, this appeal does

not present a "critical" or unsettled issue that requires this Court's

inm1ediate attention. Rather, these proceedings are little more than a

pretext for Appellants' attempt to end-run a months-old decision made by a

majority of SAG's governing Board. Appellants were neither "prejudiced"

nor "disempowered" by the acts passed by a majority of the Board on

January 26, 2009-they were simply outvoted. Indeed, there is very good

reason why this Court has never before felt the need to comment on Section

7211(b). With few exceptions, the minutiae ofa corporation's self-

governance decisions are best left in the boardroom, /lot the courtroom.

The lower court exercised sound discretion when it correctly found

that the California Legislature has sanctioned a company's use of bylaws to

regulate the conduct of its affairs, and that SAG's enactment of bylaws that

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provide for a majority-vote "written assent" procedure is authorized by, and

does not conflict with, settled California law.

Respondent SAG respectfully requests that the Court deny this

appeal and affirm the trial court's February 5, 2009 order denying

Appellants' ex parte application for a temporary restraining order.

II. STATEMENT OF RELEVANT FACTS

A. Events Leading up to Appellants' Filing of the Action

Beginning in April 2008, SAG began negotiations with the Alliance

of Motion Picture and Television Producers ("AMPTP") regarding the

tenns of SAG's collective bargaining agreement. (AOB, at p. 5.) SAG's

Chief Negotiator and National Executive Director ("NED") at that time was

Douglas Allen ("Allen"). (Id.) The most controversial subject of the

SAG/AMPTP negotiations was the manner in which SAG members would

receive residual payments from content presented in "new media"

electronic formats-such as from DVDs and the Internet. (Id. at p. 7.)

By January 2009, the SAG/AMPTP negotiations were at a standstill

after many months of bargaining, and a deep rift had fornled among SAG's

members regarding the manner in which SAG should approach the

negotiation process. Fueled by concerns about the state of the economy,

many members of SAG's governing Board believed that a change in SAG's

leadership would revive the contract negotiations and avoid further job

losses.

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AJ73023949.5
On January 12 and 13,2009, SAG's Board of Directors (the

"Board") held a 28-hour "marathon" meeting. (Respondent's Request for

Judicial Notice ["RRJN"], Ex. 2, pp.034-35, Declaration of Michelle

Bennett ["Bennett Decl."], at ~ 8.) Appellant Alan Rosenberg

("Rosenberg"), SAG's President, presided over the meeting as its

chairperson. At the meeting, various members of SAG's Board expressed

displeasure with Allen's negotiation tactics, and proposed a motion to

remove Allen as NED. (AOB, at p. 9.) However, Appellants and their

allies on the Board employed a variety of filibustering tactics in order to

prevent the Board from voting on the motion. (See RRJN, Ex. 2, pp. 034-

35, Bennett Decl., at ~ 8.)

B. The January 26, 2009 Written Assent

On or about January 26, 2009, SAG Board members holding 52.52%

of the votes signed a "written assent," which was circulated by email and

fax, and delivered it to SAG (the "Written Assent"). (RRJN, Ex. 2, pp. 035

& 039-40, Bennett Decl., at ~ 9; AOB, at pp. 10-11; see also Appellants'

Appendix ["AA"], Vol. 1, Ex. 5, pp. 00231-233.) Among other things, the

Written Assent terminated Allen as NED and Chief Negotiator and installed

David White ("White") as interim NED and Jolm T. McGuire ("McGuire")

as interim Chief Negotiator. (rd.)

Polls taken by email and/or fax are the commonly used fonn of

written assent provided for by Article V, Section 1(J)(4) of SAG's

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Constitution and By-Laws, and have been considered valid acts of SAG's

Board for many years. (RRJN, Ex. 2, p. 031, Bennett Dec!., at ~ 3.)

Pursuant to that provision of the Constitution and By-Laws, the written

assent of a majority of the votes of the Board is required for action to be

taken by written assent. (Id.)

Since June of 2004, SAG has conducted ten separate email/fax polls

of the Board, resulting in decisions on thirteen different questions

submitted to the Board. (RRJN, Ex. 2, pp. 031-32, Bennett Dec!., at'l14.)

The types of issues considered by the Board by email/fax poll range from

relatively minor to those of major importance, including the delegation of

authority to hire senior executive staff, approval of the tem1ination of the

offering of certain collective bargaining agreements, appointment of

candidates to outside boards or trusteeships, approval of the creation of

taskforces and appointment of their members, and delegation of the

authority to call a strike of the membership. (Id. at ~'114-5.)

Appellants themselves concede that SAG has employed the "written

assent" procedure, without objection, in order to allow the Board to validly

act by majority vote without a meeting. (AA, Vo!. 1, Ex. 5, p. 00196,

McCord Dec!., '1117.) And, as recently as April 2009, Appellant Anne-

Marie Jolmson, SAG's First Vice President, has employed the "written

assent" procedure to approve the appointment of a Hollywood Division Co-

Chair of SAG's Interactive Negotiating Committee. (RRJN, Ex. 2, p. 032,

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Belmett Decl., at 'If 5.) None of the written assents by email/fax poll

approved since June 2004 have ever been unanimously approved by all

Board members. (Id. at pp. 031-32, Bennett Decl., 'If 4.)

C. Appellants Unsuccessfully Attempt to Enjoin SAG from


Acting Pursuant to the Written Assent

On February 3, 2009, Appellants filed a Complaint against SAG and

several of its individual board members for Breach of Fiduciary Duty and

Violation of California Business & Professional Code § 17200. 1 (AA, Vol.

1, Ex. 1, pp. 00001-20.) Appellants alleged that the January 26, 2009

Written Assent wrongftilly "dispensed with the need for prior notice or

actual Board meeting, discharged Mr. Allen from his position, and

disbanded the TV/Theatrical Committee." (Id. at 'If 59, pp. 00009:27-10:1.)

Contemporaneous with the filing of their Complaint, Appellants also

filed an Ex Parte Application for a temporary restraining order ("TRO") to

seek to enjoin SAG, its Board, and its newly-appointed interim NED, Chief

Negotiator and Negotiation Taskforce from taking any action under the

January 26,2009 Written Assent. (AOB, at p. 15; AA, Vol. 1, Ex. 2, pp.

00021-00 I32.) The relief sought by Appellants' TRO application included

a request that the tenllS of the Written Assent be "lawfully presented to and

approved by a binding vote of the full SAG Board at a properly noticed and

lawful Board meeting ...." (AA, Vol. 1, Ex. 2, p. 00022, II. 6-12; AA,

I Appellants recently dismissed the individual board members.

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Vol. 2, Ex. 6, pp. 00322:20-00323:8.) The Court denied Appellants' Ex

Parte Application on procedural grounds. (AOB, at p. 15.)

On February 5, 2009, Appellants filed a First Amended Complaint

for Declaratory Relief and Violation of Business & Professions Code §§

17200 et seq., again challenging the January 26, 2009 Written Assent, and

renewed their Ex Parte Application for a TRO. (AOB, at p. 16; AA, Vols.

1-2, Exs. 3-6, pp. 00133-320.) A lengthy hearing ensued, at which the

merits of Appellants' Ex Parte Application were argued extensively. (AA,

Vol. 2, Ex. 9, pp. 404-437.) The trial court denied the TRO Application,

ruling, among other things, that Appellants had failed to establish a

probability of success on the merits. (AOB, at pp. 16-17; AA, Vol. 2, Ex.

9, p. 00436, II. 14-15, 19-23 & Ex. 11, pp. 00444-447.)

D. SAG Holds a Special Meeting to Reaffirm the Acts Passed


by the January 26, 2009 Written Assent

On February 3, 2009, the same day that Appellants first filed their

Complaint below, White, as SAG's NED, noticed a special meeting of

SAG's Board for February 8, 2009, pursuant to the requirements of the

SAG's Constitution and By-Laws, including Article V, Section I(J)(3).

(RRJN, Ex. 2, pp. 035-36, Bennett Decl., at '1110; AA, Vol. I, Ex. 5, p.

00245.)

On February 5, 2009, a notice was sent to all members and alternates

of the Board by SAG's standard notification process, advising them that the

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agenda for the meeting of February 8, 2009, had been posted to the secure

section of the SAG website designated for Board members and alternates,

and that each attending member would receive a hard copy of the agenda in

advance of the meeting, either by ovemight mail or in person. (RRJN, Ex.

2, p. 36, Bennett Dec!., at ~ II.) Item 2 on the meeting agenda was the

"Adoption and Reaffirmation of Written Assent of January 26, 2009." (Id.

at pp. 36,41; Appellants' Request for Judicial Notice ["ARJN"], Ex. C, pp.

00460-461, 00464, Declaration of Alan Rosenberg, at ~ 16.)

On February 8, 2009, SAG's Board of Directors convened at a duly-

noticed meeting. (See RRJN, Ex. 2, pp. 035-37, Bennett Dec!., ~~ 10-12.)

Each and every member of the Board was represented. (Id. at ~ 12.)

Appellant Rosenberg presided over the meeting for nearly its entire

duration. (Id.) Rosenberg began the February 8, 2009 Meeting by adopting

the agenda circulated to the members at White's direction. (Id. at pp. 037,

046, Bennett Dec!., ~ 13.)

At no time prior to the vote adopting the agenda did any Board

member Appellants included make a point of order regarding the

validity of the manner in which the meeting was noticed. (RRJN, Ex. 2, p.

37, Bennett Dec!., ~ 13.) And, at no time during the twelve-hour meeting

did Rosenberg relinquish his chair to debate. (See Id. at pp. 036-37,

Bennett Dec!., ~ 12.)

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At the meeting, a majority of SAG's Board dealt a fatal blow to the

instant Appeal by affirming and readopting the acts previously passed by

the Written Assent. (See RRJN, Ex. 2, pp. 037-38, Bennett Dec!., ~ 14.)

The matter was debated for approximately one hour. (Id.) By a resounding

59.02% majority -larger than the 52.52% majority that originally passed

the written assent - the Board voted to reaffirm and readopt the acts

previously passed by written assent. (RRJN, Ex. 2, pp. 054-55.)

Appellants made and seconded a motion to reconsider the vote, and

a point of order was immediately raised, asserting that the motion for

reconsideration was out of order. (RRJN, Ex. 2, pp. 038 & 055-56, Bennett

Dec!., ~ IS.) Although Rosenberg, as the meeting's chair, ruled that the

motion for reconsideration was in order, he was ovemJied by a majority of

the Board, who deemed Appellants' motion to reconsider to be out of order.

(RRJN, Ex. 2, p. 038, Belmett Dec!., ~ IS.)

E. Appellants Unsuccessfully Seek Expedited


"Extraordinary" Writ Review in This Court

On or about February II, 2009, Appellants filed a Petition for Writ

of Mandate ("Writ Petition") in this Court, by which they requested

expedited review of the lower Court's denial of their temporary restraining

order. (ARIN, Ex. A.) Appellants' Writ Petition was summarily denied on

February 13,2009.

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F. SAG's Membership Overwhelmingly Votes to Ratify a
New Contract with the AMPTP

On June 9, 2009, SAG's members voted to approve a two-year

TV/Theatrical contract with the AMPTP, by a vote of78 percent to 22

percent, with more than 30,000 members voting in favor. (RRJN, Exs. 4, 5,

pp. 101, 105.) This is the same contract that was the subject of the

negotiations that led to SAG's passage and subsequent reaffirmation of the

January 26, 2009 Written Assent. Among other things, the Written Assent

removed a committee that had been involved in the negotiation of the same

TV/Theatrical contract that was ratified on June 9, 2009. (AOB, at p. 11.)

SAG's new two-year agreement covers film and digital television

programs, motion pictures and new media productions, and expires on June

30,2011. (RRJN, Ex. 4, at p. 101.)

III. THE TRIAL COURT DID NOT ABUSE ITS DISCRETION IN


DENYING APPELLANTS' EX PARTE APPLICATION FOR
A TEMPORARY RESTRAINING ORDER

A. The Trial Court's Order Did Not "Exceed the Bounds of


Reason"

In view of the discretion vested in the trial court in addressing an

application for temporary restraining order or motion for a preliminary

injunction, appellate review of a trial court's ruling in such a proceeding is

extremely deferential. Ass'n for Los Angeles Deputy Sheriffs v. County of

Los Angeles, 166 Cal. App. 4th 1625, 1634 (Cal. App. 2d Dist. 2008)

(affirming denial of motion for preliminary injunction). As Appellants

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concede (see AOB, at p. 23), a reviewing court shall not disturb a trial

court's decision to grant or deny a motion for a preliminary or temporary

injunction absent a showing that the h'ial court abused its discretion.

Salazar v. Eastin, 9 Cal. 4th 836, 849-50 (1995); see also Robbins v.

Superior Court, 38 Cal. 3d 199,205 (1985). The test for abuse of discretion

is whether the trial court "exceeded the bounds of reason." Walker v.

Superior Court, 53 Cal. 3d 257, 272 (1991); see also Blank v. Kirwan, 39

Cal. 3d 311, 331 (1985) ("unless a clear case of abuse is shown and unless

there has been a miscarriage ofjustice a reviewing court will not substitute

its opinion and thereby divest the trial court of its discretionary power.");

Marriage of Varner, 55 Cal. App. 4th 128, 138 (1997) ("[t]he showing on

appeal is wholly insufficient ifit presents a state of facts ... which ...

merely affords an opportunity for a difference of opinion. An appellate

tribunal is neither authorized nor warranted in substituting its judgment for

the judgment of the trial judge.") (internal quotation marks omitted). The

hefty burden of establishing an abuse of discretion lies squarely on

Appellants. See Blank, at 331.

B. California Law Authorizes SAG's Enactment of Bylaws


that Govern Voting Procedures.

Appellants concede that SAG's bylaws authorize a majority-vote

"written assent" procedure without a meeting. (AOB, at p. 21.)

Specifically, Article V, § 1 (J) (4) of SAG's bylaws provides:

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Except as provided otherwise in this

Constitution, any acts shall be validfor all

purposes with or without a meeting if approved

by the written assent ofa majority ofthe votes

ofthe Board ofDirectors, or such higher

percentage of the Board votes as may be

required by this Constitution.

(See AA, Vol. 1, Ex. 5, p. 00245 [emphasis added].)

Appellants do not - because they cannot - dispute that SAG has

utilized and implemented such majority-vote written assent procedures on

numerous occasions in the past. (See AA, Vol. 1, Ex. 5, p. 00196,

Declaration of Kent McCord, ~ 17 [describing SAG's use of the majority-

mle written assent procedure].) Indeed, such practice was utilized multiple

times under the Presidency of Plaintiff Alan Rosenberg and First Vice

President Anne-Marie Johnson, respectively. (See RRJN, Ex. 2, pp. 031-

32, Bennett Decl., ~~ 3-5.)

Section 7150 of the Corporations Code provides that a non-profit

may adopt bylaws "[e]xcept as provided in subdivision (c) and Sections

7151,7220,7224,7512,7613 and 7615." Corp. Code § 7150. Section

7211 (b) of the Corporations Code, on which Appellants rely, is not

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included in the list of statutes that are not subject to variation by bylaws. 2

SAG's ability to regulate its affairs through bylaws is unremarkable

and, indeed, the preferred practice. A leading corporate treatise in

California explains that the Nonprofit Mutual Benefit Corporation Law,

under which SAG was organized, "provide[s] relatively detailed statutory

rules respecting the conduct of directors' meetings, but with relatively few

exceptions these can be changed by the articles or bylaws." See 3-19

Ballantine and Sterling California Corporation Laws (2008) § 405.02[1]

(emphasis added). Therefore, when drafting bylaws, "consideration should

be given at that stage to the need or desirability of altering the statuto I)!

scheme infavor ofone exactly tailored to a cOlporation 's needs." Id.

(emphasis added). (AA, Vol. 2, Ex. 8, p. 00400.)

The treatise further explains that "[t]he bylaws of a nonprofit

corporation, like those of a business corporation, mainly regulate the

internal affairs of the corporation. However, to the extent that they specifY

membership rights (as they frequently do), the bylaws ofa nonprofit

cOlporation serve a more important jililction than those ofa business

cOlporation, the rights of whose shareholders must appear in the articles."

2 By way of example, Section 7220, which is expressly named in Section


7150 as a statute that cannot be varied by a corporation's bylaws, provides:
"[n} 0 amendment ofthe articles or bylaws may extend the term oj a
director beyond that for which the dIrector was elected, nor may any bylaw
provision increasing the terms of directors be adopted without approval of
the members...." Corps. Code § 7220(a) (emphasis added). No such
prohibitory language appears in Section 7211 (b).

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Id. at § 404.04[1] (emphasis added). (AA, Vol. 2, Ex. 8, p. 00399.)

Our Supreme Court has upheld and enforced corporate bylaws

providing for a majority vote of the corporation's goveming members

without a meeting. Colbum Biological Inst. v. Shaffer, 12 Cal. 2d 168, 169

(1938) (holding that where bylaws of corporation provided for a three-

fourths (3/4) majority of trustees to make decisions on behalf of the

organization by a written resolution without a meeting, the vote of three

trustees over the objection of a fourth was valid and binding on the

corporation); see also Notes of Decisions No.2, Deering's Ann. Cal. Corps.

Code. § 7151 (2008). The Colbum decision is entirely consistent with the

lower court's ruling in this case, that the "written assent" procedure

provided in Article 5 § I (J)(4) of SAG's bylaws does not violate - and if

anything, is harmonious with - longstanding Califomia law. Courts should

abstain from wholesale interference in a corporation's chosen manner of

self-govemance. Williams v. Inglewood Bd. of Realtors, Inc., 219 Cal.

App. 2d 479, 488 (1963) ("In general the by-laws of associations organized

for social, charitable, moral, or religious purposes will not be scrutinized

closely by the courts, nor will they be interfered with unless there has been

an abuse of discretion and a clear, unreasonable and arbitraly invasion of

private rights.").

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C. SAG's Majority-Vote Written Assent Procedure Does Not
Conflict With Section 7211(b).

Appellants argue, for the first time, that SAG's majority-vote written

assent procedure violates Section 7151 of the Corporations Code, which

provides that "[t]he bylaws may contain any provision ...not in conflict with

law...." Corps. Code § 7151. According to Appellants, because SAG's

majority-vote, written assent procedure "conflicts" with Section 7211(b)'s

unanimous-vote, written consent procedure, SAG's bylaws violate Section

7151. Not so.

First, Section 7211(b) provides that "[a]n action required or

permitted to be taken by the board may be taken without a meeting, if all

members of the board shall individually or collectively consent in writing

to that action." Corps. Code § 7211(b) (emphasis added). By its terms,

Section 7211 (b) applies only to acts for which a board meeting is required.

Here, however, SAG's majority vote, written assent procedure is

an act for which a board meeting is not required. 3 Bylaws, Art. V § I

(J)(4). (AA, Vol. I, Ex. 5, p. 00245.) Aside from the plain language of

SAG's written assent bylaw, multiple provisions governing the voting and

3 SAG's bylaws specify the particular types of board actions that require a
meeting. See, e.g., Art. V § 1 (J)(2)(a)(b) [vote to extend length ofa board
meeting] (AA, Vol. I, Ex. 5, p. 00245); Art. V § 3 (H) (1)-(2) [nomination
and election of individual to fill vacancies in offices of President and
Secretary-Treasurer] (AA, Vol. I, Ex. 5, pp. 00250-51); Art. XVIII § I(a)
[amendment, adoption or repeal of ConstItution or By-laws] (AA, Vol. I,
Ex. 5, p. 00269); Art. XI § 3(A), incorporating by reference Appendix I, §
(I)(C) [voting at Joint Board of Directors' meetings of the American
Federation of Television and Radio Artists ("AFTRA") and SAG] (AA,
Vol. I, Ex. 5, pp. 00264 & 00275).

16
A173023949.5
quorum procedures attendant to meetings of SAG's Board of Directors

expressly affirm the Board's right to act without a meeting by the written

assent of a majority of votes of its members. See Art. V § I (J)(5)(f)

[governing the counting of votes at SAG board meetings less than two

directors are present from each division of the organization] ("Nothing in

this Section shall be construed so as to limit the authority of the Board of

Directors to act by written assent as provided by Section 4 of this Article.")

(AA, Vol. I, Ex. 5, p. 00246); Art. V. § I (J)(6) [requiring that all voting at

board meetings be done in person or by telephone or videoconference]

(" ... this shall not preclude the right of the Board of Directors to act by

written assent of a majority of votes of its members, or such higher

percentage of the Board votes as may be required by this Constitution.")

(AA, Vol. I, Ex. 5, p. 00247).

Accordingly, where SAG's bylaws clearly authorize the Board to act

by majority assent without a meeting, imposition of Section nil (b)'s

onerous unanimity requirement - which applies to board acts that require a

board meeting - would impose a far greater burden on SAG's decision-

making procedures than SAG's founding documents contemplate.

Second, Section nil (b) can only be construed as a "default" statute

that is subject to variation by bylaws adopted by a non-profit corporation

for its own self-governance. An examination of the Legislative history of

Section 1211's sister statute - Corporation Code Section 307 - is

17
A173023949.5
instructive in this regard. Section 307(b) is identical to Section 7211(b),

but it applies to for-profit corporations. See 13 Cal. Law Revision Comm'n

Reports, Recommendations and Studies 220 I, 2228 (1976) (stating that, in

recommending the provisions of the Corporations Code that presently

govern nonprofit corporations, the provisions of the new non-profit chapter

generally follow the substance of the General Corporation Law). (AA, Vol.

2, Ex. 8, p. 00403.) The legislative comments contained in the annotations

to Section 307 expressly state that it may be amended by bylaws, as

follows: "This section contains technical mles relating to the calling,

noticing and functioning of board meetings ... all ofthese provisions are

subject to alteration in the articles (including any 'super-majority' vote

requirement) or bylaws." Legis. Com. com., Deering's Ann. Cal. Corps.

Code § 307 (2008) (emphasis added). (AA, Vol. 2, Ex. 8, p. 00384.) It

would be anomalous to treat Section 7211 (b), which parallels Section

307(b) verbatim, any differently.

Finally, it is important to note that in enacting the Corporations

Code, the California legislature made it a point to note when its provisions

cannot be varied by a company's bylaws. For example, Section 7211(a)(8)

provides "[t]he articles or bylaws may not provide that a lesser vote than a

majority of the directors present at a meeting is the act of the board."

Corps. Code § 7211(a)(8) (emphasis added). No such prohibitory language

appears in Section 7211 (b). And, as Appellants aptly note in their Opening

18
A173023949.5
Brief, no such prohibitOlY language should be implied where the

Legislature has intentionally excluded it. (See AOB, at p. 25, citing People

v. Gardeley, 14 Cal. 4th 605, 621-22 (1996) ["When the Legislature has

used a tenn or phrase in one part of a statute but excluded it from another,

courts do not imply the missing term or phrase in the part of the statute

from which the Legislature has excluded it."].)

D. The Tasks Accomplished by the Majority-Vote Written


Assent Do Not Conflict With SAG's Bylaws

Appellants erroneously contend that one of the acts accomplished by

the majority-vote written assent - disbanding the TV/Theatrical Committee

and fonning a "Negotiation Taskforce" in its stead - violated Article VI,

Section 7(A) of SAG's bylaws, which requires a two-thirds vote of the

Board to "remove any conmlittee member, alternate or co-chair." (AOB, at

pp. 31-32; AA, Vol. I, Ex. 5, p. 00254.) In support of their contention,

however, Appellants repeat the same erroneous arguments that the Court

below already considered and rejected.

Appellants mischaracterize the written assent's wholesale

disbanding of the TV/Theatrical Committee as the effective "removal" of

12 "committee members," in an attempt to bring the Board's action within

the purview of the two-thirds requirement of Article VI, Section 7(A).

(AOB, at p. 34.) However, no committee members were removed from a

committee, and Appellants simply apply the wrong bylaw provision to the

19
A173023949.5
Board's conduct.

Critically, SAG's bylaws permit the Board to establish committees

"which shall serve at its pleasure." See Article V, Section 1(I)(3). (AA,

Vo!. 1, Ex. 5, p. 00244.) Additionally, SAG's Article V, Section 1(I)(4),

provides that "the Board of Directors may, from time to time, delegate any

of its powers and duties to any committees, which delegation shall be

revocable by the Board ofDirectors at any time." (1d. [emphasis added].)

This is precisely what SAG's Board accomplished by the written assent. It

exercised its right to disband the TV/Theatrical Committee in its entirety,

and did not "remove" any of its individual conmlittee members.

Appellants improperly conflate the concepts of a "COlmnittee" and a

"Taskforce," which are accorded disparate and distinct roles under SAG's

longstanding rules of govemance. (RRJN, Ex. 2, pp.033-34, Bennett Dec!.,

at ~ 7.) Appellants lament that the Taskforce created by the Written Assent

is actually the "TV/Theatrical Committee in disguise." (AOB, at p. 33.)

Appellants are misguided. While SAG's National Board has the power

under Article V, Section 1(1)(4) to delegate its authority to a committee,

there is no authority for the Board to delegate its authority to a "taskforce."

(AA, Vo!. 1, Ex. 5, p. 00244.) Thus, unlike the TV/Theatrical Committee,

the Taskforce has no authority to act on the Board's behalf, but can only

make recommendations on which the Board has discretion to act. (RRJN,

Ex. 2, pp. 033-34, Bennett Dec!., at ~ 7.)

20
A!73023949.5
E. Public Policy Weighs Heavily Against Court Involvement
in Internecine Issues

SAG has the authority to adopt, amend, or repeal bylaws, but that

power is subject to limitations contained in its articles of incorporation, in

the Nonprofit Mutual Benefit Corporation Law, and in the bylaws

themselves once adopted. Within these limits, SAG has a "free hand" in

regulating its affairs, "the only other test of the validity of bylaws being

whether they operate reasonably and equally as to all members." See 3-19

Ballantine and Sterling California Corporation Laws § 404.04[1] (AA, Vol.

2, Ex. 8, p. 00399); accord Braude v. Havenner, 38 Cal. App. 3d 526, 533

(1974); Haynes v. Annandale Golf Club, 4 Cal. 2d 28,30 (1935). Courts

must guard against unduly interfering with an organization's autonomy by

substituting judicial judgment for that of the organization in an area where

the competence of the court does not equal that of the organization. See

California Dental Ass'n v. Am. Dental Ass'n, 23 Cal. 3d 346, 353-354

(1979). "The practical and reasonable construction of the constitution and

bylaws of a voluntary organization by its governing body is binding on the

membership and will be recognized by the courts." Williams, supra, 219

Cal. App. 2d at 486.

Below, Appellants did not challenge SAG's enactment of its bylaws.

Instead, they asked the trial court, and now this Court, to substitute its

judgment for that of SAG's Board of Directors on questions such as the

21
AI7J023949.5
proper interpretation of SAG's governing documents and the proper

management of SAG. Such relief would plunge this Court into the "dismal

swamp" of an internal union dispute. Kurz v. Fed. ofPetangue U.S.A., 146

Cal. App. 4th 136, 149-50 (2006). California public policy weighs heavily

against judicial intervention in the internal disputes of unions and other

organizations. See, e.g., Kurz, at 149-50; Oakland Raiders v. Narl Football

League, 131 Cal. App. 4th 621, 644-45 (2005); Calif. Trial Lawyers Ass'n

v. Superior Court, 187 Cal. App. 3d 575, 580 (1986); Motion Picture &

Videotape Editors Guild, Local 776, etc. v. Inri Sound Technicians, etc.,

Local 695, 800 F.2d 973, 975 (9th Cir. 1986). Judicial "reluctance to

intervene in internecine controversies ... is premised on the principle that

the judiciary should generally accede to any interpretation by an

independent voluntary organization of its own rules which is not

unreasonable or arbitrary." Calif. Trial Lawyers, 187 Cal. App. 3d at 580.

Courts may also decline to exercise jurisdiction over intemal organizational

disputes if "the resulting burdens on the judiciary outweigh the interests of

the paliies at stake." Calif. Dental Ass'n, 23 Cal. 3d at 353.

Appellants half-heartedly argue - without any factual or legal

support - that "public policy" considerations mandate reversal of the lower

Court's order and require that a corporation's "written assent must be

unanimous." (AOB, at pp. 29-31.) Indeed, Appellants' cited authorities-

most of which are either unpublished or hail from other jurisdictions - are

22
A173023949.5
inapposite. And, Appellants' assertion that "there was no exchanging of

views and no deliberate consideration of any issue" is belied by the facts.

In reality, Appellants and the other opponents ofthe Written Assent had a

full and fair opportunity - and did - debate its merits on at least two

occasions. The issues encompassed by the challenged Written Assent were

first debated at a 28-hour-long Board meeting that took place on January 12

and 13,2009, at which Appellants and their allies opted to filibuster at the

28-hour January meeting instead of allowing the Board to vote. (See

RRJN, Ex. 1, p. 009 & Ex. 2, pp. 034-35, Bennett Dec!., at ~ 8). Upon

Appellants' insistence that SAG convene a formal Board meeting, the

identical issues were debated yet again for approximately one hour at the

February 8, 2009 Board meeting, at which a majority of SAG's Board of

Directors voted to reaffiml and readopt the acts previously passed by the

Written Assent. (RRJN, Ex. 1, pp. 023-24 & Ex. 2, pp. 036-38, Bennett

Dec!., at ~~ 12-14.) By all accounts, the issues passed by the January 26,

2009 Written Assent - and subsequently re-affirmed at a duly-held Board

meeting - were deliberately vetted and considered by SAG's Board of

Directors. The notion of "negotiated consensus" upon which Appellants

dwell is purely aspirational and has no practical application here. All that

is required by California law - and by SAG's governing documents - is

that a majority of SAG's Board reach a reasoned decision in order to bind

the corporation.

23
A173023949,5
It is ironic that Appellants purport to base this appeal on principals

of democratic self-govemance, yet complain that SAG's actions contravene

"public policy" when they find themselves on the losing side of a

democratically-administered vote.

F. Appellants' Requested Temporary Restraining Order


Was Flawed

A temporary restraining order or preliminary injunction is not

designed to restore the parties to the status they occupied prior to the acts

complained of. See Cont'l Baking Co. v. Katz, 68 Cal. 2d 512, 528 (1968)

("The general purpose of [a preliminary] injunction is the preservation of

the status quo until a final determination of the merits of the action.");

Stewart v. Superior Court of San Diego County, 100 Cal. 543, 546 (1893)

("The office of a writ of injunction, as its name imports, is peculiarly a

preventive and not a remedial one; it is to restrain the wrongdoer, not to

punish him after the wrong has been done or to compel him to undo it.");

see also Allen v. Hotel & Restaurant Employees' Int'l Alliance &

Bartenders' Int'I League, 97 Cal. App. 2d 343, 348 (1950). Here, however,

Appellants' requested temporary restraining order did not seek to preserve

the status quo - it sought to radically alter it. In essence, Appellants asked

the Court below, under the guise of a temporary restraining order, to sua

sponte revise SAG's bylaws, and restore SAG's former leadership. That is

not the function of a temporary restraining order, and the trial Court acted

24
A!73023949.5
correctly in denying Appellants' request. Accordingly, the very relief that

Appellants seek on this appeal- for this Court to "undo" the events of the

past six months and to restore the parties to the positions they occupied

before January 26, 2009 - is not only impracticable, but is contrary to law.

IV. THE APPEAL SHOULD BE DISMISSED AS MOOT

SAG's previously filed motion to dismiss this appeal as legally moot

was denied by this Court on June 9, 2009. Since then, additional events

have transpired that - in themselves - moot important aspects of this

appeal, including, inter alia, Appellants' efforts to restore a negotiating

conmlittee whose primary charge was to negotiate the same TV/Theatrical

Agreement ratified by SAG's membership on June 9, 2009. SAG

respectfully renews its challenge to this appeal as moot. See Chernett v.

Jacques, 202 Cal. App. 3d 69, 71 (1988) (court may consider merits of

dismissability issue following initial denial of motion to dismiss appeal).

"It is well settled that an appellate court will decide only actual

controversies and that a live appeal may be rendered moot by events

occurring after the notice of appeal was filed." Daily Journal Corp. v.

County of Los Angeles, 172 Cal. App. 4th 1550, 1557 (Cal. App. 2d Dist.

2009); accord Downtown Palo Alto Com. for Fair Assessment v. City

Council, 180 Cal. App. 3d 384,391 (1986) ("[A]n appeal presenting only

abstract or academic questions is subject to dismissal as moot."). On

February 8, 2009, following the Respondent Court's denial of Appellants'

25
A173023949.5
Ex Parte Application for a temporary restraining order, SAG's Board of

Directors convened at a duly-noticed meeting. (See RRJN, Ex. 2, pp. 035-

37, Bennett Dec!., "iI"iI 10-12.) At the meeting, a majority of SAG's Board

removed any doubt as to the legitimacy of its actions by affirming and

readopting the acts previously passed by written asset. Based on this fact

alone, the entire Appeal should be dismissed as moot.

As an initial matter, Appellants mischaracterize the Board's

February 8, 2009 vote as an affirmance of an illegal act. (AOB, at pp. 36-

37; RRJN, Ex. 3, p. 70, Opp. to Motion to Dismiss.) However, the Board's

majority decision to affirm and readopt the acts passed by the January 26,

2009 Written Assent was not a vote to "retroactively validate" the Written

Assent. To the contrary, the February 8, 2009 vote - which took place at a

duly held meeting at which every Board member was represented -

constituted an independent and presumptively valid act of the Board. See

Corps. Code § 7211(a)(8). (See also RRJN, Ex. I, pp. 018-024.) That act

superseded the January 26, 2009 Written Assent and rendered the instant

appeal moot. Indeed, much to Appellants' chagrin, the Board's February 8,

2009 vote reaffinned the same acts passed by the January 26, 2009 Written

Assent by an even larger majority. (RRJN, Ex. 2, pp. 037-38, Bennett

Dec!., '1 14.) Appellants' purported attack on the procedures applied at the

Board's February 8, 2009 meeting is nothing more than a transparent, "Hail

Mary" attempt to reverse the majority's decision.

26
A173023949,5
Yet another subsequent event moots at least part of this appeal. On

June 9, 2009, an overwhelming majority of SAG's membership ratified a

new TV/Theatrical contract with the AMPTP. (RRJN, Exs. 4, 5, pp. 101,

105). The instant appeal, however, predominantly concerns Appellants'

challenge to SAG's January 26, 2009 Written Assent, which, among other

things, disbanded a TV/Theatrical Negotiating Conunittee whose primary

charge was to negotiate the Vel)1 same contract with the AMPTP that has

now been ratified. (See AOB, at p. 11; RRJN, Ex. 2, p. 039.) Clearly, this

Court can no longer restore a conunittee for the purpose of negotiating the

TV/Theatrical agreement-because those contract negotiations have

already concluded. See, ~ Daily Journal Corp., 172 Cal. App. 4th at

1557 (appeal that sought to unwind and declare invalid a contract that had

already expired by its own tenns was moot); Giles v. Hom, 100 Cal. App.

4th 206, 219 (2002) (appeal in action to enjoin county's expenditure of

public funds to hire private contractors dismissed as moot where contracts

expired and were fully perfonned pending appeal); Jennings v. Strathmore

Public Util. Dist., 102 Cal. App. 2d 548, 549 (1951) (dismissing appeal as

moot where plaintiff appealed trial court's denial of injunction to declare a

public utility district contract invalid, after the contract had been awarded

and work under the contract fully completed).

In their opposition to Respondents' Motion to Dismiss Appeal as

Moot, Appellants correctly identified two well-established discretionary

27
A173023949.5
exceptions to the rules regarding mootness: (l) when the case presents an

issue of broad public interest that is likely to recur; (2) or when there may

be a recurrence of the controversy between the parties. See Envtl. Charter

High School v. Centinela Valley Union High School Dist., 122 Cal. App.

4th 139, 144 (Cal. App. 2d Dist. 2004). (RRJN, Ex. 3, pp. 093-94.)

However, neither of those exceptions applies here.

First, this case - which involves a challenge by a highly litigious

minority faction of an entertainment guild to the Board's decision to

replace members of the union's leadership - does not present an issue of

"substantial and continuing public interest." California's appellate courts

have historically invoked the "public interest" exception to the mootness

doctrine only in cases that either affect a large subset of California's

population,4 or present issues of widespread constitutional or fiscal impact. 5

4 See, e.g., Chantiles v. Lake Forest II Master Homeowners Ass'n, 37 Cal.


App. 4th 914,922 (1995) (analogizing homeowners associations to "mini-
governments" that affect "a large number" of California citizens); Braude v.
Havenner, 38 Cal. App. 3d 526, 529-30 (1974) (considering proxy voting
procedures within the one-million-member Automobile Club of Southern
California).
5 See, e.g., White v. Davis, 30 Cal. 4th 528, 536-37 (2003) (deeming a
taxpayer action to enjoin California controller's disbursement of funds
without the enactment of an emergency appropriation bill an issue of
"profound public significance"); Conservatorship of Wendland, 26 Cal. 4th
519, 524, fn. I (2001) (considering limitations on conservators' power to
withhold life-sustaining treatment to a conscious conservatee); People v.
Travis, 139 Cal. App; 4th 1271, 1279-80 (2006) (considering whether
mandatory collection of DNA samples violates fourth amendment's
prohibition against nonconsensual searches and seizures); Californians for
Fair Representation - No on 77 v. Superior Court, 138 Cal. App. 4th 15,22
(2006) (finding that "[t]he purity of elections and the full disclosure of all
contributions and expenditures are matters of public interest.").

28
A173023949.5
Notwithstanding Appellants' lofty rhetoric, the instant appeal simply does

not rise to the level of "profound public significance" necessary to warrant

consideration on its merits.

Second, the issue is not likely to recur between the parties. Indeed,

SAG's decades-old bylaw providing for majority written assent has never

before been challenged by members of its board. This appeal involves a

specific "Written Assent" that took place on January 26, 2009 under very

specific factual circumstances that involved the negotiation of a new

TV/Theatrical contract. Such fact-dependent questions are more properly

decided on a case-by-case basis. See MHC Operating Ltd. P'ship v. City of

San Jose, 106 Cal. App. 4th 204, 215 (2003); Giles, 100 Cal. App. 4th at

228 ("Because plaintiff s claim is a particularly factual determination that

must be resolved on a case-by-case basis, dependent upon the specific facts

of a given situation, it is not one on which we would exercise our discretion

to address on the merits, despite the fact that it is moot.,,).6

In addition, Appellants erroneously contend, based on a

misapplication of Civil Code section 2313, that the corporate acts taken by

a majority of SAG's Board of Directors at the Febmary 8, 2009 Board

meeting are "unenforceable." (RRJN, Ex. 3, pp. 086-87.) However,

6 Appellants are not without a remedy, should they continue to dispute


SAG's longstanding majority written assent procedure. Pursuant to Article
XVIII, Section 1 of SAG's Bylaws, Appellants may institute proceedings to
amend the contested bylaw. (See AA, Vol. 1, Ex. 5, p. 00269.)

29
A17302J949.5
Section 2313 of the Civil Code has no application here, for a whole host of

reasons. That statute - which applies to the narrow situation in which a

principal ratifies an unauthorized act by an agent - is irrelevant to this case,

which involves a corporate body's reaffinnance of its own prior act. 7

Moreover, Appellants' contention that they "would be prejudiced if the

February 8 Motion was deemed to ratify the January 26 written assent" is

unintelligible. (RRJN, Ex. 3, pp. 086-87.) Appellants - each of whom is a

member of SAG's Board of Directors - are decidedly not third parties to

the acts of SAG's Board. And, being on the losing side of a

democratically-administered majority vote does not constitute the kind of

"prejudice of third persons" contemplated in Section 2313. Even if Civil

Code Section 2313 were somehow deemed to apply to this case, it would

still be irrelevant here because Appellants effectively gave their "consent"

to the February 8, 2009 board meeting's procedure and agenda. The

agenda - which Appellant Rosenberg himself adopted - prominently

featured the very action item that Appellants now purport to challenge-the

"Adoption and Reaffinnation of Written Assent of January 26, 2009."

(RRJN, Ex. 2, pp. 036-37 & 041, Bennett Decl., ~~ II, 13.)

7 As such, the Archdale and Dominguez decisions cited by Appellants -


which considered the unrelated issue of whether a defendant, as a third
party to the plaintiffs attorney-client relationship, would be prejudiced if
the plaintiffs post-filing ratification of its complaint were to preclude the
defendant from asserting a statute of limitations defense - are inapplicable.
See Archdale v. Am. Int'! Specialty Lines Ins. Co., 154 Cal. App. 4th 449,
480 (2007); Dominguez v. Superior Court, 139 Cal. App. 3d 692,695
(1983).

30
A173023949.5
SAG's Board has met and voted in favor of the acts previously

passed by written assent. This Appeal is legally moot.

V. CONCLUSION

The relief requested by Appellants is not only unwaITanted, but this

Court is not capable of providing any effective relief, in light of SAG's

Board's affinnance and readoption of the acts passed by the disputed

Written Assent. The Court should not interject itself into this internal union

matter, and, in any event, the trial court acted properly and within its

discretion, and certainly did not "exceed the bounds of reason." SAG's

enactment of bylaws that provide for a majority-vote written assent

procedure is authorized by California law. Nor do such bylaws conflict

with Section 7211(b) or any other provision oflaw. The appeal should be

denied and the lower court's ruling affirnled. Alternatively, the Court

should dismiss the appeal as moot.

DATED: July 1,2009 Bingham McCutchen LLP

By:'--_~L- _
Roland Tellis
Attorneys for Respondent
Screen Actors Guild

31
A173023949.5
CERTIFICATE OF WORD COUNT

I certify that this Motion to Dismiss contains 7,509 words, as

counted by the Microsoft Word 2003 software used to generate it.

. =) 2-
DATED: July 1,2009 Bingham McCutchen LLP
L~/
By:
=------'-----------
Roland Tellis
Attomeys for Respondent
Screen Actors Guild

32
AI7J023949.5
PROOF OF SERVICE
I am over eighteen years of age, not a party in this action, and employed in

Los Angeles County, California at The Water Garden, Fourth Floor, North Tower, 1620

26th Street, Santa Monica, California 90404-4060. I am readily familiar with the

practice of this office for collection and processing of con-espondence for mail/fax/hand

delivery/next business day delivery, and they are deposited that same day in the ordinary

course of business.

On July 1,2009, I served the attached:

RESPONDENT'S BRIEF

!&I (BY MAIL) by causing a true and correct copy of the above to be placed in the
United States Mail at Santa Monica, California in sealed envelope(s) with postage
prepaid, addressed as set forth below. I am readily familiar with this law firm's
practice for collection and processing of cOlTespondence for mailing with the
United States Postal Service. Correspondence is deposited with the United States
Postal Service the same day it is left for collection and processing in the ordinary
course of business.

See Attached Service List

I declare under penalty ofpeljury under the laws of the State of California

that the foregoing is true and con-ect and that this declaration was executed on

July 1,2009, at Santa Monica, California.

N73080632.1/300981 0-0000337304
SERVICE LIST

Eric M. George Los Angeles Superior Court


Sonia Y. Lee Dept. 85 - Judge James C. Chalfant
BROWNE WOODS GEORGE LLP 111 North Hill Street
2121 Avenue of the Stars, 24th Floor Los Angeles CA 90012
Los Angeles CA 90067 Los Angeles Superior Court
Tel: 310.274.7100 Dept. 19 - Judge Judith Chirlin
Fax: 310.275.5697 111 N. Hill Street
egeorge@bwgfirm.com Los Angeles CA 90012
slee@bwgfirm.com (courtesy copy)

Supreme Court of California


Vincent F. Pitta
350 McAllister Street
Barry N. Saltzman San Francisco CA 94102-7303
Pitta & Giblin LLP (4 copies)
120 Broadway
New York NY 10271
Tel: 212.652.3890
Fax: 212.652.3891

N73080632.1/300981 0·000033 7304