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Horvitz & Levy successfully represented defendant E-Commerce Exchange, Inc. in the California Supreme Court in this putative class action. The plaintiff did not bring her action to trial within five years of filing her complaint. As a result, E-Commerce and other defendants moved to dismiss her action under California’s mandatory dismissal statute, which requires dismissal of cases not brought to trial within five years. The trial court granted the motion. A divided Court of Appeal reversed, holding that the trial court erred in dismissing the action in part because the mandatory dismissal statute contains an exception for periods when “prosecution or trial of the action was stayed or enjoined.” The Court of Appeal ruled that “a partial stay of an action,” such as a stay of discovery only or a limited stay for the purpose of actively managing a complex action, is a stay of prosecution within the meaning of the statute and thus tolls the five-year period.

The California Supreme Court granted review and reversed. Agreeing with Horvitz & Levy’s briefing, the Supreme Court held that only complete stays—those that bar all activity in a case—are “stays of prosecution” within the meaning of the mandatory dismissal statute. The Court remanded to the Court of Appeal for a determination of whether the trial court abused its discretion in concluding that, under a different subdivision of the mandatory dismissal statute, the partial stays at issue did not render it “impossible, impracticable or futile” to bring the action to trial within five years.