When dealing with a forged check claim, banks typically have two defenses: (1) the customer’s delay in notifying the bank and/or filing a lawsuit, and (2) contributory negligence. In enacting California Code of Civil Procedure Section 340, the legislature sought to bring uniformity to claims involving forged or unauthorized endorsements. This section provides a one-year statute of limitations, triggered from the date that a routine monthly account statement reporting the unauthorized check becomes available to the customer, and acts to bar stale claims regardless of whether or not the bank was negligent in paying the check.

In addition to expanding the time frame in which a plaintiff may file a civil lawsuit, the amended law also allows a plaintiff to recover triple the amount of actual damages against a defendant that “covered up” the sexual assault of a minor. (Cal. Code Civ. Proc. § 340, subd. (b)(1) [as amended].) “Cover up” is statutorily defined as “a concerted effort to hide evidence relating to childhood sexual assault.”

This means that false statements posted to the Internet will be subject to a clear and definite statute of limitations period triggered by the initial publication. Given the short statute of limitation period for defamation actions in many states (e.g., California’s one year period under Cal. Code. Civ. Proc. § 340(c)), Internet content providers need not be concerned with potential liability unexpectedly arising from old publications. Moreover, this case demonstrates that when dealing with a public figure, First Amendment protections are alive and well.

Krupnick v. Duke Energy Morro Bay, 115 Cal. App. 4th 1026 (2004)John Krupnick filed this personal injury action against Duke Energy Morro Bay on January 8, 2003 for injuries allegedly sustained on January 26, 2001. Duke filed a demurrer on the ground that the action was barred by the one-year statute of limitations of former California Code of Civil Procedure Section 340(3). Krupnick argued in response that the applicable statute of limitations was two years rather than one, based upon California Code of Civil Procedure Section 335.1, which was enacted in 2002 and became effective on January 1, 2003.