Judge: Kevin C. Brazile, Case: 21STCV21496, Date: 2023-02-08 Tentative Ruling

Hearing Date: February 8, 2023

Case Name: Digital Dolphin Supplies, LLC v. Cotton, et al.

Case No.: 21STCV00223

Matter: Motion to Certify Class

Moving Party: Defendant Justin Cotton 

Responding Party: Plaintiff Digital Dolphin Products, LLC

Notice: OK

Ruling: The Motion is granted.  

Moving party to give notice.

If counsel do not submit on the tentative, they are strongly 

encouraged to appear by LACourtConnect rather than in person due to the COVID-19 pandemic. 

On January 5, 2021, Plaintiff Digital Dolphin Products, LLC filed the operative Complaint against Defendants Justin Cotton and Quire Office Products LLC for (1) breach of fiduciary duty, (2) misappropriation of trade secrets, (3) breach of contract, (4) interference with contractual relations, and (5) interference with prospective economic advantage.  Plaintiff alleges that Defendants stole Plaintiff’s trade secrets and created a competing business while still employed by Plaintiff. 

On April 15, 2022, Justin Cotton and Quire Office Products LLC, individually and on behalf of others similarly situated, filed a Second Amended Cross-Complaint (“SACC”) against Digital Dolphin Products, LLC, a California LLC, and Digital Dolphin Products, LLC, a Nevada LLC, for (1) violation of Bus. & Prof. Code § 17200, (2) declaratory relief, (3) breach of contract, (4) violation of Penal Code § 496, (5) fraud, (6) fraudulent concealment, and (7) nonpayment of wages.  Among other things, Cross-Complainants allege that the Digital Dolphin entities fraudulently underpaid commissions on sales of personal protective equipment (“PPE”).  

Defendant Justin Cotton now seeks “an order certifying the following classes for the third, fourth, fifth, sixth, and seventh causes of action in the Second Amended Cross-Complaint: 

• Class 1 (PPE Class): all Digital Dolphin (California) employees who made any sales of PPE (where the commission was underpaid due to Digital Dolphin’s paying based on a unit cost number that was higher than its actual cost), DDS warehouse, or CleanzGuard products on or after January 1, 2020; 

• Class 2 (Loan Class): all Digital Dolphin (California) employees who were loaned or advanced any money under Digital Dolphin (California)’s Magic Number and Bank commission advancement or loan policy; and 

• Class 3 (Toner Class): all Digital Dolphin (California) employees who made any sales of toner (at any point from September 22, 2017, to the present) that Digital Dolphin (California) bought from Aster Graphics, Ninestar, Royal Imaging, or Supplies Wholesalers.

Mr. Cotton also seeks an order appointing him as the representative of, and Warren Terzian LLP as the counsel of, all three classes.”

Plaintiff opposes the Motion, primarily contending that Cotton is conflicted due to the claims against him.  

Class certification is appropriate when “the question is one of a common or general interest, of many persons, or when parties are numerous and it is impracticable to bring them all before the court.”  (Code Civ. Proc. § 382.) “The party advocating class treatment must demonstrate [1] the existence of an ascertainable and sufficiently numerous class, [2] a well-defined community of interest, and [3] substantial benefits from certification that render proceeding as a class superior to the alternatives.”  (Brinker Rest. Corp. v. Superior Court (2012) 53 Cal. 4th 1004, 1021.)  Trial courts are afforded great discretion in granting or denying certification, and “[a]ny valid pertinent reason stated will be sufficient to uphold the order.”  (Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 435-36.)

As to the issue of a sufficiently ascertainable and numerous class, courts examine the class definition, the size of the class, and the means of identifying class members.  (Miller v. Woods (1983) 148 Cal.App.3d 862, 873.)  “Class members are ‘ascertainable’ where they may be readily identified without unreasonable expense or time by reference to official records.”  (Rose v. City of Haywood (1981) 126 Cal.App.3d 926, 932.)  

Here, the putative class is sufficiently ascertainable in that their identities can apparently be determined by reviewing employment records.  (See 8 CCR § 11050(7)(A); see also Exhibit B.)  Further, the class definition is sufficiently narrow so as to allow an individual to reasonably determine whether they are a member of the putative class.  There are approximately [redacted] class members; this is sufficiently numerous so as to warrant class treatment.  (See 1 Newberg on Class Actions (2011) § 3:12.)

Next, the “community of interest” component “embodies three factors: (1) predominant common questions of law or fact; (2) class representatives with claims or defenses typical of the class; and (3) class representatives who can adequately represent the class.”  (Sav-On Drug Stores, Inc. v. Superior Court (2004) 34 Cal.4th 319, 326.)  “The ‘ultimate question’ for predominance is whether ‘the issues which may be jointly tried, when compared with those requiring separate adjudication, are so numerous or substantial that the maintenance of a class action would be advantageous to the judicial process and to the litigants.’ ”  (Duran v. U.S. Bank Nat'l Assn. (2014) 59 Cal. 4th 1, 28.)  “As a general rule if the defendant's liability can be determined by facts common to all members of the class, a class will be certified even if the members must individually prove their damages.”  (Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004, 1021–1022.)  However, class treatment is not appropriate “if every member of the alleged class would be required to litigate numerous and substantial questions determining his individual right to recover following the ‘class judgment’ ” on common issues.  (City of San Jose v. Superior Court (1974) 12 Cal.3d 447, 459.)  

Here, the evidence sufficiently demonstrates that (1) the claims at issue pertain to consistent, uniform practices applicable to all employees, and (2) such claims are adequately pursued by class representative, Justin Cotton, who has no apparent conflicts.  (See Cotton Decl. ¶¶ 11-15.)  Plaintiff has failed to show that the claims against Cotton create an actual conflict of interest relative to his claims as class representative.  (See, e.g., Fireside Bank v. Superior Ct. (2007) 40 Cal.4th 1069.)

There being numerosity, ascertainability, and a community of interest, the Motion is granted.

Moving party to give notice.

If counsel do not submit on the tentative, they are strongly encouraged to appear by LACourtConnect rather than in person due to the COVID-19 pandemic.