Judge David S. Cunningham, Case 22STCV30393 2023-05-02 Tentative Ruling

Judge: David S. Cunningham, Case: 22STCV30393, Date: 2023-05-02 Tentative Ruling

Moving Party: Ecology Control Industries, Inc. (“Defendant” or “Ecology Control”)

Defendant moves to bifurcate discovery, law and motion, and trial as to three issues:

[1] whether Plaintiff was exempt from overtime because he was a driver under the California Code of Regulations (“CCR”) and/or exempt from overtime under the CCR because he drove a truck that transported hazardous materials; [2] whether his meal and rest break claims are preempted by the Federal Motor Carrier Safety Administration and/or the Pipeline and Hazardous Materials Safety Administration; and [3] whether he has standing to bring any remaining claims or derivative claims.

(Notice of Motion, p. 2.) The goal of the motion is to establish a first phase of litigation that focuses on Plaintiff’s individual claims. Defendant contends limiting the first phase to “the issues of exemption, preemption and standing as to Plaintiff only” will advance justice and efficiency, prevent inconvenience and burden, and facilitate meaningful settlement discussions. (Motion, p. 9, emphasis in original; see also id. at pp. 6-8 [arguing that (1) “avoidance of crushing discovery costs is an important reason courts give for doing away with class action claims early in litigation, when procedurally reasonable[,]” (2) if Plaintiff loses in the first phase, “discovery as to [the] putative class on their respective hours of service, overtime and meal and rest will be exceedingly demanding on the Court’s and parties’ resources, and in the end the discovery, evidence or testimony on these subjects” will be “unnecessary[,]” and (3) for Plaintiff’s PAGA representative claim, the Court should sequence discovery and should determine Plaintiff’s standing before litigating liability issues].)

* Defendant relies on distinguishable authorities and fails to meet its burden to show that “bifurcation will promote judicial economy and avoid inconvenience or prejudice to the parties[.]” (Opposition, p. 3; see also id. at pp. 4-6.)

* Class-wide discovery is needed to assess Defendant’s overtime policy. (See id. at p. 8.)

* The preemption issues apply to all putative class members and cannot be resolved by a bifurcated trial on Plaintiff’s individual circumstances. (See id. at pp. 8-10.)

* Plaintiff does not need to “prove that he has the requisite standing as an aggrieved employee before proceeding with a PAGA representative action.” (Id. at p. 11.)

* “[F]orcing an aggrieved employee to prove his/her case, even just in part, before being allowed to step into the state's shoes frustrates the purposes of PAGA.” (Id. at p. 13.)

* “California courts have . . . repeatedly rejected the proposition that the ‘aggrieved employee’ determination can be bifurcated before a court considers the aggrieved employee’s representative PAGA claim[.]” (Id. at p. 14.)

* Defendant fails to show that PAGA discovery “will be burdensome” if bifurcation is denied. (Id. at p. 15.)

* Defendant’s authorities are persuasive, and Plaintiff fails to distinguish them. (See Reply, pp. 3-4.)

* Plaintiff’s arguments concerning PAGA do “nothing to counter the reasons why this case is well suited for bifurcation[.]” (Id. at p. 4 [asserting that bifurcation should be granted because: “[1] The applicable exemptions and preemption topics are discrete and severable issues that could narrowly tailor the class certification process. [2] Discovery and trial in the first phase will be straightforward and easily managed. If Defendant prevails on the first phase, the time, effort, and expense regarding class discovery regarding meal period waivers, on-duty meal period agreements, meal period and rest break premiums, regular rate calculations, and expert analysis regarding the same would not be necessary. This leads to a lower chance of discovery disputes for the Court to resolve. [3] It is likely to facilitate more meaningful settlement discussions between the parties than would be possible otherwise. [4] Time would be spared because Defendant would not be forced to litigate the same applicable defenses as to all drivers.”].)

* The opposition brief’s discussion of the merits of Plaintiff’s claims is irrelevant at this stage. (See id. at pp. 6-7.)

The Court finds that the motion should be denied. Any merits determination made against Plaintiff’s individual claims pre-certification would not be binding on the putative class. (See, e.g., Edmon & Karnow, supra, at ¶ 14:94 [instructing that (1) “[a]bsent ‘compelling justification,’ the court should not decide ‘substantial issues relating to liability’ before the class has been certified and members of the class given the opportunity to opt out[,]” and (2) “[p]ostponing merits rulings until all parties are bound avoids so-called ‘one-way intervention’ whereby not-yet-bound absent plaintiffs may elect to satay in a class after favorable merits rulings but opt out after unfavorable ones”]; see also Fireside Bank v. Superior Court (2007) 40 Cal.4^th 1069, 1080 [“[T]he vice in the procedure followed by the trial court is that it allows so-called ‘one-way intervention,’ a procedure under which potential members of the class can reserve their decision to become part of the class until the validity of the cause asserted by the named plaintiffs on behalf of the class has been determined. While one-way intervention has obvious attractions for members of the class on whose behalf an action has been brought in that it creates for them a no-lose situation, for a defendant it holds the terrors of an open-ended lawsuit that cannot be defeated, cannot be settled, and cannot be adjudicated. To him it presents a classic no-win option.”].) If, for example, the Court found that Plaintiff is exempt from overtime, it would not dispose of the overtime class claim. The same is true of the preemption and standing issues. Instead of dismissing the case, the Court would be obligated to give Plaintiff a chance to name a new putative class representative, and the litigation, in effect, would restart at the beginning. (See, e.g., Jones v. Farmers Ins. Exchange (2013) 221 Cal.App.4^th 986, 999.) Accordingly, bifurcation will not benefit the interests of justice and judicial economy.[1]

* In Rees v. Souza’s Milk Transportation Co. (E.D. Cal. Jan. 30, 2008, No. 1:05-cv-00297-LJO-SMS) 2008 WL 276574, following a ruling on a motion for summary adjudication, the district judge found that “the applicability of the motor carrier safety exemption” should be decided prior to damages issues. (Rees, supra, 2008 WL 276574, at *1.) It is unclear whether the bifurcation ruling occurred pre-certification or post-certification, but, regardless, it was unopposed. (See ibid.)

* In Morales v. 22^nd District Agricultural Assn. (2016) 1 Cal.App.5^th 504, the bifurcation took place “[a]fter the trial court conditionally certified the case as a collective action” and after “177 individuals joined the action as additional plaintiffs.” (Morales, supra, 1 Cal.App.5^th at 513, 514.) There is no indication that any party opposed bifurcation.

* Pellegrino v. Robert Half International, Inc. (2010) 182 Cal.App.4^th 278 appears to have been a non-class action. Also, the trial court bifurcated the equitable claims post-summary judgment, just before trial. (See Pellegrino, supra, 182 Cal.App.4^th at 285.)

[1] The “one-way intervention” rule is typically viewed as a rule to protect defendants. While Defendant does not mention or rely on the rule in its briefs, the Court raises it to emphasize the impact of pre-certification merits rulings. They are nonbinding, so it is inefficient to bifurcate to decide pre-certification merits issues.

Nevertheless, Defendant is free to bring an early motion for summary adjudication against Plaintiff if it wants to. Defendant should be aware, though, that the class claims will remain and that the certification process will still go forward.