Judge: Monica Bachner, Case: 21STCV11337, Date: 2023-01-31 Tentative Ruling

Case Number: 21STCV11337    Hearing Date: January 31, 2023    Dept: 71

Superior Court of California

County of Los Angeles

DEPARTMENT 71

TENTATIVE RULING

Defendants Designed Metal Connections, Inc.’s and Precision Castparts Corp.’s motion to strike is moot as to the 1st, 4th, and 5th causes of action and granted as to the 2nd, 3rd, and 6th causes of action without leave to amend.

Defendants Designed Metal Connections, Inc. (“DMC”) and Precision Castparts Corp. (“PCC”) (collectively, “Defendants”) move to strike from Plaintiffs Reina Guevara’s (“Guevara”) and Angelina Turner’s (“Turner”) second amended complaint (“Guevara SAC”), and Maria Lara’s (“Lara”) complaint (“Lara Complaint”) (1) the second cause of action for civil penalties pursuant to PAGA due to Defendants’ alleged failure to provide meal periods; and (2) the third cause of action for civil penalties pursuant to PAGA due to Defendants’ alleged failure to provide rest periods.[1]  (Notice of Motion, pg. 1; C.C.P §§128, 187; C.R.C., Rule 3.400.)  Defendant DMC further moves to strike from Plaintiff Lara’s Complaint the following: (3) the sixth cause of action for civil penalties pursuant to PAGA due to Defendant DMC’s alleged failure to indemnify for expenditures or losses in discharge of their duties.  (Notice of Motion, pg. 1; C.C.P §§128, 187; C.R.C., Rule 3.400.)  Defendants bring this motion on the grounds that Plaintiffs’ PAGA claims cannot be manageably tried.  (Notice of Motion, pg. 1.)

Procedural Background

On March 24, 2021, Plaintiff Guevara filed her initial complaint against Defendants in Case No. 21STCV11337 (“Guevara Complaint”).  On May 28, 2023, Plaintiff Guevara filed her first amended complaint (“Guevara FAC”) against Defendants.  On July 8, 2021, Plaintiff Lara filed her operative complaint (“Lara Complaint”) against Defendant DMC only, in Case No. 21STCV25089 for six causes of action for violations of PAGA: (1) recovery of unpaid wages and overtime; (2) failure to provide meal periods; (3) failure to provide rest periods; (4) failure to provide accurate itemized wage statements; (5) failure to pay wages due upon termination of employment; and (6) failure to indemnify for expenditures or losses in discharge of duties.  On July 9, 2021, Plaintiff Turner filed her complaint (“Turner Complaint”) against Defendants in Case No. 21TRCV00498 for five causes of action for violation of PAGA: (1) recovery of unpaid wages and overtime; (2) failure to provide meal periods; (3) failure to provide rest periods; (4) failure to provide accurate itemized wage statements; and (5) failure to pay wages due upon termination of employment.  On September 10, 2021, Plaintiff Guevara filed her operative second amended complaint (“Guevara SAC”) naming Plaintiff Turner as a named plaintiff with the same five causes of action as the Turner Complaint.  On May 4, 2022, this Court ordered Plaintiffs’ cases consolidated in Case No. 21STCV11337, Guevara v. Designed Metal Connections, Inc., et al.  (5/4/22 Minute Order.)  On May 4, 2022, Plaintiff Turner filed a request to dismiss her separately filed case, Case No. 21TRCV00498, without prejudice.  For the purposes of this motion, the operative complaints are the Lara Complaint and the Guevara SAC. 

On July 15, 2022, Defendants filed the instant motion. On January 18, 2023, Plaintiffs filed their opposition.  Defendants filed their reply on January 24, 2023.

Summary of Allegations

          Plaintiffs Guevara and Turner seek to recover PAGA penalties on behalf of all of Defendants’ non-exempt employees who were employed within one year of the filing of the initial Guevara Complaint until the present.  (Guevara SAC ¶¶1, 8, 15).  Plaintiff Lara seeks to recover PAGA penalties on behalf of Defendant DMC’s non-exempt employees who were employed within one year and sixty-five days of filing the Lara Complaint.  (Lara Complaint ¶¶1, 11, 14.)  Plaintiffs Guevara and Turner allege they were employees of Defendants from June 2004 through July 10, 2020, and April 2014 through July 10, 2020, respectively, in non-exempt hourly positions. (Guevara SAC ¶¶8, 9, 18.)  Plaintiff Lara alleges she was an employee of Defendant DMC from around November 1988 through May 13, 2020.  (Lara Complaint ¶6.)  Plaintiffs Guevara and Turner allege on November 9, 2020, and December 2, 2020, they gave written notice by certified mail to the Labor and Workforce Development Agency (“LWDA”) and to Defendants of the specified provisions that were alleged to be violated.  (Guevara SAC ¶19.)   Plaintiff Lara alleges on April 30, 2021, she gave written notice to the LWDA and Defendants of the specified provisions that were alleged to be violated.  (Lara Complaint ¶13.) 

Motion to Strike

Legal Standard

C.R.C., Rule 3.400 recognizes that a complex case “requires exceptional judicial management to avoid placing unnecessary burdens on the court or the litigants and to expedite the case, keep costs reasonable, and promote effective decision making by the court, the parties, and counsel.”  (C.R.C., Rule 3.400(a).)

C.C.P. §128(a)(8) provides that “every court shall have the power to . . . amend and control its process and orders so as to make them conform to law and justice.”  (C.C.P. §128(a)(8).)

C.C.P. §187 provides, “[w]hen jurisdiction is . . . conferred on a Court or judicial officer, all the means necessary to carry it into effect are also given; and in the exercise of this jurisdiction, . . . any suitable process or mode of proceeding may be adopted which may appear most conformable to the spirit of this Code.”  (C.C.P. §187.)  “[C]ourts have inherent equity, supervisory and administrative powers as well as inherent power to control litigation before them.”  (Cottle v. Superior Court (1992) 3 Cal.App.4th 1367, 1377-1379, citations omitted).

          Trial Manageability

In the PAGA context, the California Supreme Court recognized that manageability was a key component to establishing liability at trial, suggesting that “a plaintiff might seek to render trial of [a PAGA] action manageable” by establishing the existence of a uniform policy applicable to all employees.  (Williams v. Superior Court (2017) 3 Cal.5th 531, 559.)  Where highly individualized assessments would be necessary to establish liability, a plaintiff cannot meet their burden to prove manageability.  (Wesson v. Staples the Office Superstore, LLC (2021) 68 Cal.App.5th 746, 765 [“[W]e conclude that courts have inherent authority to ensure that PAGA claims can be fairly and efficiently tried and, if necessary, may strike a claim that cannot be rendered manageable.”], reh’g denied (Sept. 27, 2021), review denied (Dec. 22, 2021).)

There is a split in authority on whether trial courts have an inherent authority to strike PAGA claims as unmanageable.  Plaintiffs argue in opposition that this Court should follow Estrada v. Royalty Carpet Mills, Inc., which held that “a court cannot dismiss a PAGA claim based on manageability.”  (Estrada v. Royalty Carpet Mills, Inc. (2022) 76 Cal.App.5th 685, 710, reviewed granted  (June 22, 2022).)  This conclusion is based on the analysis that the ability to control litigation, including the power to strike or limit claims, is a special class action power.  (Id. at pg. 711-12.)  The Court respectfully choses to follow the Wesson analysis. 

Further, Estrada ignores precedent such as Williams that acknowledges trial courts could foreclose a subsequent trial if the plaintiff did not establish that the claim was otherwise “manageable,” whereas Wesson uses Williams to support its conclusion.  (Wesson, 68 Cal.App.5th at pg. 766.)  Wesson relies on a line of cases, such as South Bay Chevrolet v. General Motors Acceptance Corp., which held that a plaintiff could not pursue a “private attorney general” claim under the UCL on a non-class, representative basis because of “the need for ‘mini-trials’” to evaluate the merits of the claims and the claims “were not sufficiently uniform to allow representative treatment.”  (South Bay Chevrolet v. General Motors Acceptance Corp. (1999) 72 Cal.App.4th 861, 891, 897.)  Thus, this Court chooses to follow Wesson rather than Estrada.

Failure to Provide Meal Breaks (2nd COA)

California’s meal break law generally requires employers to provide employees with a 30-minute meal period if they work more than five hours in the workday.  (Lab. Code §512(a).)  If employees will not work more than six hours, they can waive the meal period.  (Id.)  If employees work more than 10 hours in a workday, then they are entitled to a second 30-minute meal break.  (Id.)  If employees will not work more than ten hours, they can waive the second meal period if the first meal period was not waived.  (Id.)  If an employer fails to provide an employee with a meal break, then the employer must pay the employee one additional hour of pay at the employee’s regular rate of compensation for each workday that a meal break was not provided.  (Lab. Code §226.7(c).)

Plaintiffs allege Defendants did not schedule employees in a manner to

permit for timely meal breaks; the “nature of their work” prevented them from taking meal breaks; and there is a presumption of a meal break violation if a timely 30-minute meal break is not recorded.  (Guevara SAC ¶¶31-32, 49, 53-54, 55; Lara Complaint ¶¶20, 42.)

          Defendants argue Plaintiff’s theories relating to the work schedule being too rigorous and the nature of the work precluding meal breaks are inherently individualized.  (Amiri v. Cox Communications California, LLC (C.D. Cal. 2017) 272 F.Supp.3d 1187, 1190.)  In Amiri, the court dismissed the off-the-clock PAGA claim as unmanageable because the plaintiff’s claim relied on personal anecdotes of off-the clock work; the plaintiff provided no evidence that could demonstrate all aggrieved employees engaged in off-the-clock work and their supervisors knew or should have known about it; and the defendant provided declarations of other employees who never worked off-the-clock.  (Id. at pg. 1197.)

          Plaintiffs argue in opposition that their proposed trial plan would review all non-exempt hourly employees’ time and pay records and use a representative survey and/or deposition sampling methodology to gather relevant information not ascertainable from the timekeeping and payroll records, including reasons for taking late, short or no meal periods and could include an inquiry about meal period waivers and attestation forms.  (Opposition, pg. 9; Donohue v. AMN Services, LLC (2021) 11 Cal.5th 58.)

          Here, Plaintiffs’ claim based on their “off-the-clock” theory is unmanageable even with modifications based on Plaintiff’s proposed trial plan because time records alone would not provide the reason why a meal period was missed or taken late, and Plaintiffs do not provide an explanation as to how Defendants can assert their defense that any purported meal period violations were caused by the employee, rather than Defendants, without Defendants being permitted to question each employee at trial or deposition with respect to every potential meal period violation.  Further, non-exempt employees have declared they did not work off-the-clock during meal breaks or at the end of their shifts.  (CCE 1.)  This discrepancy establishes there are significant issues with respect to Plaintiffs’ theories of liability and the need to try Plaintiffs’ claims by taking the individual testimonies of more than 500 employees. Thus, the meal period claim is not manageable. 

Failure to Provide Rest Breaks (3rd COA)

California’s rest break law requires employers to authorize and permit employees to take rest periods at the rate of 10 minutes for every four hours worked or major fraction thereof.  (Industrial Welfare Commission (“IWC”) Wage Order 1-2001, Cal. Code Regs. tit. 8, §11010.)

          Plaintiffs allege Defendants failed to implement a “relief system” to

enable Plaintiffs to take rest breaks; (2) Defendants interrupted rest breaks; and (3) the “nature of their work” prevented them from taking rest breaks.  (Guevara SAC ¶62; Lara Complaint ¶20.)

Plaintiffs argue their rest break claim can be manageably tried because Defendants are not entitled to litigate their defenses as to each individual employee.  (Opposition, pg. 11; Duran v. U.S. Bank National Association (2014) 59 Cal.4th 1, 38.)  Plaintiffs’ assertion is incorrect: PAGA penalties are assessed on a per employee, per pay period, basis.  Defendants would be denied their right to due process if they were not permitted to challenge every instance where Plaintiffs contend that a penalty should be assessed.  (Id. at pg. 33.)  Further, rest breaks are not recorded, which compounds the manageability of trying Plaintiff’s claim.  (Cicairos v. Summit Logistics, Inc. (2005) 133 Cal.App.4th 949, 963.)

Similar to Plaintiffs’ meal break claim, to preserve Defendants’ due process rights, Plaintiff’s rest break claims can only be tried by gathering the testimony of each aggrieved employee regarding their rest break experiences every pay period and providing Defendants the opportunity for cross-examination regarding same. Thus, Plaintiffs’ rest break claim is not manageable.

Failure to Reimburse for Business Expense (6th COA)

Employers are required to reimburse their employees for all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties.  (Lab. Code, § 2802.)  However, Plaintiffs must establish that Defendants knew that expenses were incurred and willfully refused to reimburse them.  (Hammitt v. Lumber Liquidators, Inc. (S.D. Cal. 2014) 19 F.Supp.3d 989, 1000-1001 [“Absent evidence Defendant knew or had reason to

know that Plaintiff had incurred business-related expenses, Defendant is not liable for failure to reimburse Plaintiff for those expenses as a matter of law.”]; Nelson v. Dollar Tree Stores, Inc. (E.D. Cal. Aug. 15, 2011, No. 2:11-CV-01334 JAM) 2011 WL 3568498, at *3.)

          Plaintiff Lara alleges Defendant DMC failed to reimburse employees for using their cellular phones for work purposes.  (Lara Complaint ¶¶24, 81).

          Plaintiffs argue a survey and/or deposition methodology offers a viable approach for adjudicating the reimbursement claim and Plaintiff Lara will use a survey or deposition sample to gather information about frequency of using their personal cell phone and whether or not employees were reimbursed a reasonable percentage of their cell phone bill.  (Opposition, pg. 13.)  Plaintiffs’ reimbursement claim, like the meal and rest break claims, requires individual testimony of aggrieved employees to demonstrate Defendants knew that expenses were incurred as to each employee and willfully refused to reimburse them, and the opportunity for cross-examination.  Thus, Plaintiffs’ reimbursement claim is not manageable.

Based on the foregoing, Defendant’s motion to strike is denied as moot as to the 1st, 4th, and 5th causes of action and granted as to the 2nd, 3rd, and 6th causes of action without leave to amend.

Dated:  January _____, 2023

Hon. Monica Bachner

Judge of the Superior Court