LOS ANGELES—Today, the final signatures were affixed to the settlement agreed upon between plaintiff Vivid Entertainment Group, defendant County of Los Angeles, and intervenors AIDS Healthcare Foundation (AHF) and various of its employees, and perhaps its most attractive feature is that the parties have agreed that Measure B will not be enforced in Los Angeles County for three years from the date the settlement takes effect.
"Intervenors [AHF and employees] expressly agree that they will not file any lawsuit, claims, causes of action or administrative complaints or actions regarding the enforcement of Measure B for a period of three (3) years from the date the Action is dismissed by Plaintiffs with prejudice," Section II-4 of the settlement agreement states. "Notwithstanding this paragraph, Intervenors do not waive their right to file a notice of a dispute, lawsuit, claim, causes of action or adminsitrative action related to any congtroversy or claim arising out of or relating to this Agreement or the validity, inducement or breach thereof, pursuant to Section II-5 and IV-9 below."
Section II-5, titled "Dispute Resolution," refers to controversies or claims arising out of any breach of the settlement agreement, and does not apply to an adult production company shooting within the county without using condoms and other barriers. Section IV-9, however, titled "Choice of Law and Venue," states that "This agreement shall be interpreted according to the laws of the State of California. The Parties agree that any controversy among the Parties involving or relating to the meaning, application and/or interpretation of this Agreement or any breach or claimed breach of this Agreement shall be filed in the United States District Court for the Central District of California or the Los Angeles Superior Court."It also notes that any such disputes must first be referred to mediation by "an attorney who has at least ten (10) years of experience with a law firm or corporate law department with demonstrated expertise in the areas of dispute or who was a judge of a court of general jurisdiction."
But while AHF may be barred from filing any complaint regarding non-compliance with Measure B, the possibility exists that Cal/OSHA, which is not bound by this agreement, may begin targeting productions on its own since the "laws of California" include the California Health Code, Section 5193, which has been interpreted by Cal/OSHA as requiring not only condoms but other "barrier protections."
That said, the settlement agreement also provides that "All Parties agree that Measure B shall be considered by the Parties to be in effect and enforced but permanently enjoined as enumerated by the District Court's Order dated August 16, 2013, wherein Judge Pregerson partially granted and partially denied Intervenors' Motion to Dismiss, partially granted and partially denied Plaintiffs' Motion for Preliminary Injunction, and vacated Plalintiffs' Motion for Judgment on the Pleadings, and as upheld by the Ninth Circuit, unless subsequently amended, revised or repealed, or unless further enjoined by subsequent court order." [Emphasis in original] While that clause may appear to contradict the agreement that Measure B will not be enforced for three years, this paragraph apparently will only apply after the end of that three-year moratorium.
The settlement also includes a clause wherein the Plaintiffs and Intervenors (but, oddly, not the Defendant County of Los Angeles) agree to waive any rights those parties may have under California Civil Code Section 1542, which clause states in part, "Plaintiffs and Intervenors acknowledge that they are aware that facts may hereafter be discovered in addition to or different from those now known or believed to be true with respect to this release, but that it is the intention of the Plaintiffs and Intervenors to hereby fully, finally and forever release and discharge each other, and thus this release shall remain in effect as a full and complete release notwithstanding the later discovery or existence of any such additional or different facts."
In other words, even if AHF and its employees missed some violation of Measure B committed by Vivid or other producers, such violations are deemed included in this settlement and will not form the basis of any future legal action begun by either Vivid or AHF.
One has to wonder, though, whether the legality of the massive expenditures by AHF to, first, get Measure B on the ballot, and later, to promote its passage in the County, which may very well be in violation of the expenditure limits allowed for a non-profit entity of AHF's size, may still be investigated by the state revenue department as well as the IRS. Nothing in the settlement agreement appears to bar such investigations.
Also of interest: Although the current lawsuit has been settled between the parties "with prejudice," meaning that Vivid is barred from refiling this or a similar lawsuit against the County in the future, the agreement does not (and in fact cannot) bar some other adult content producer from filing a similar lawsuit against the County, and thanks to the U.S. Supreme Court's decision in Hollingsworth v. Perry (the same-sex marriage case), AIDS Healthcare Foundation and anyone else not directly affected by Measure B's provisions would be barred from intervening in such a suit.
In short, the settlement of Vivid Entertainment, LLC et al v. County of Los Angeles, et al, with AHF and its employees as Intervenors, appears to be one that is favorable to the adult industry, at least in the short run.
