Judge: Teresa A. Beaudet, Case: 24STCV12787, Date: 2025-02-07 Tentative Ruling

Case Number: 24STCV12787    Hearing Date: February 7, 2025    Dept: 50

Superior Court of California

County of Los Angeles

Department 50

Background

Plaintiff Nicholas Rosen (“Plaintiff”) filed this action on May 21, 2024 against Defendant Stockwell Harris Woolverton & Fox (“Defendant”).

Plaintiff filed the operative First Amended Complaint (“FAC”) on July 16, 2024, alleging causes of action for (1) failure to timely pay earned wages during employment, (2) waiting-time penalty for nonpayment of wages, and (3) unfair business practices.

In the FAC, Plaintiff alleges, inter alia, that “[o]n or around September 19, 2022, Plaintiff began his employment as an Associate Attorney.” (FAC, ¶ 8.) Plaintiff alleges that “[p]ayment was due from [Defendant] bi-monthly, on the 10th and the 26th of the month. On some occasions, payment was due on the 11th and the 27^th.” (FAC, ¶ 12.) Plaintiff alleges that Defendant “post marked payments for the correct date, but in fact, did not mail the payments until several days later, resulting in 20 late payments of Plaintiff’s wages.” (FAC, ¶ 14.) Plaintiff further alleges that he “was terminated from [Defendant] on July 27, 2023,” and that he “did not receive his final paycheck until January 10, 2024.” (FAC, ¶¶ 17-18.)

Defendant now moves for an order reclassifying this case as a limited jurisdiction matter. Plaintiff opposes.

Discussion

A “limited civil case” includes, inter alia, a “case at law if the demand, exclusive of interest, or the value of the property in controversy amounts to thirty-five thousand dollars ($35,000) or less.” (Code Civ. Proc., § 86, subd. (a)(1).) “A civil action or proceeding other than a limited civil case may be referred to as an unlimited civil case.” (Code Civ. Proc., § 88.)

 Pursuant to Code of Civil Procedure section 403.040, subdivision (a), “[t]he plaintiff, cross-complainant, or petitioner may file a motion for reclassification within the time allowed for that party to amend the initial pleading. The defendant or cross-defendant may file a motion for reclassification within the time allowed for that party to respond to the initial pleading. The court, on its own motion, may reclassify a case at any time. A motion for reclassification does not extend the moving party’s time to amend or answer or otherwise respond. The court shall grant the motion and enter an order for reclassification, regardless of any fault or lack of fault, if the case has been classified in an incorrect jurisdictional classification.”

Pursuant to Code of Civil Procedure section 403.040, subdivision (b), “[i]f a party files a motion for reclassification after the time for that party to amend that party’s initial pleading or to respond to a complaint, cross-complaint, or other initial pleading, the court shall grant the motion and enter an order for reclassification only if both of the following conditions are satisfied: (1) The case is incorrectly classified. (2) The moving party shows good cause for not seeking reclassification earlier.”

In Walker v. Superior Court (1991) 53 Cal.3d 257, 261, cited by the parties, the California Supreme Court “granted review to resolve a conflict in the Courts of Appeal concerning interpretation of Code of Civil Procedure section 396, which governs the transfer of cases from the superior court to the municipal court when an action fails to meet the superior court’s jurisdictional requirement of an amount in controversy exceeding $25,000.” The Walker Court “construe[d] section 396 as requiring transfer when (i) the absence of jurisdiction is apparent before trial from the complaint, petition, or related documents, or (ii) during the course of pretrial litigation, it becomes clear that the matter will ‘necessarily’ result in a verdict below the superior court jurisdictional amount, and the court affords the parties an opportunity to contest transfer.” (Id. at p. 262 [emphasis in original].)

In the motion, Defendant first asserts that “in reviewing the FAC and, specifically paragraph 16 of the FAC, the absence of jurisdiction in the unlimited jurisdiction court is apparent.” (Mot. at p. 5:1-2.) In paragraph 16 of the FAC, Plaintiff alleges that “[o]n 20 separate occasions, [Defendant] was late in providing payment to Plaintiff.” (FAC, ¶ 16.) Paragraph 16 of the FAC lists twenty penalties that are allegedly due, which appear to total $27,589.40. (FAC, ¶ 16.) Defendant argues that “[a]ssuming arguendo Plaintiff’s allegations are proven to be true, at most, Plaintiff would be entitled to $27,598.43, approximately, $7,401.57 under the jurisdictional threshold of $35,000.” (Mot. at p. 4:11-13.)

But the penalties alleged in paragraph 16 of the FAC appear to only pertain to Plaintiff’s first cause of action for “failure to timely pay earned wages during employment.” In such cause of action, Plaintiff alleges that “Defendants’ failure to timely pay wages due under Labor Code § 204 violated the requirements of that statute, and these violations were willful or intentional, thereby subjecting Defendants to civil penalties under Labor Code § 210.” (FAC, ¶ 24.) Labor Code section 210 provides, inter alia, that “[i]n addition to, and entirely independent and apart from, any other penalty provided in this article, every person who fails to pay the wages of each employee as provided in Sections 201.3, 204, 204b, 204.1, 204.2, 204.11, 205, 205.5, and 1197.5, shall be subject to a penalty as follows: (1) For any initial violation, one hundred dollars ($100) for each failure to pay each employee. (2) For each subsequent violation, or any willful or intentional violation, two hundred dollars ($200) for each failure to pay each employee, plus 25 percent of the amount unlawfully withheld.” (Lab. Code, § 210, subd. (a).)[1]

Plaintiff also alleges a cause of action for “waiting-time penalty for nonpayment of wages.” This cause of action alleges, inter alia, that “Plaintiff was terminated from his employment with the Company on July 27, 2023,” and that “Plaintiff did not receive his final paycheck until January 10, 2024.” (FAC, ¶¶ 29-20.) Plaintiff alleges that “[p]ursuant to California Labor Code § 203, Plaintiff is entitled to recover damages for the nonpayment of wages in the form of waiting time penalties…” (FAC, ¶ 31.) Labor Code section 203, subdivision (a) provides in pertinent part that “[i]f an employer willfully fails to pay, without abatement or reduction, in accordance with Sections 201, 201.3, 201.5, 201.6, 201.8, 201.9, 202, and 205.5, any wages of an employee who is discharged or who quits, the wages of the employee shall continue as a penalty from the due date thereof at the same rate until paid or until an action therefor is commenced; but the wages shall not continue for more than 30 days.”

In the FAC, Plaintiff alleges that he “was paid an annual salary of $195,000.00 plus 5% of profit shares of billings for business he brought to the firm.” (FAC, ¶ 11.) Plaintiff asserts that his “daily rate of pay was roughly $812.50,” and that accordingly, “pursuant to Labor Code § 203, Plaintiff would be entitled to a penalty of $812.50 x 30 days= $24,375.00.” (Opp’n at p. 6:18-21.) As noted by Plaintiff, Defendant does not account for the alleged waiting time penalties in its motion.

In the motion, Defendant also asserts that “Plaintiff has no documentary proof that his payments were actually received late.” (Mot. at p. 6:5-6.) Defendant’s counsel states that “[o]n November 26, 2024, [Defendant] propounded its first set of Requests for Production of Documents,” and that “[t]he requests asked for Plaintiff to provide,” inter alia, the “mailed envelope(s) [Plaintiff] received from [Defendant]” on certain specified dates. (Gershfeld Decl., ¶¶ 6-7, Ex. C.) Defendant’s counsel states that “[i]n response to each request asking for the mailed envelopes, Plaintiff provided the following response – ‘A diligent search and reasonable inquiry has been made with regard to this Request. As such, this responding party in unable to comply with this Request as she is not in possession of the requested documents. Plaintiff reserves the right to supplement and/or amend his response. Discovery is continuing.’” (Gershfeld Decl., ¶ 8.)[2]

But the Court does not find that Defendant has shown that “the lack of envelopes means Plaintiff has no probability of proving his case.” (Opp’n at p. 8:15.) In Walker, the California Supreme Court noted that “the second paragraph of section 396 provides for transfer if it appears that the action…will necessarily involve the determination of questions not within the jurisdiction of the court…This standard requires a high level of certainty that a damage award will not exceed $25,000 and is not satisfied by a finding that such an award is merely unlikely or not reasonably probable.” (Walker v. Superior Court, supra, 53 Cal.3d at p. 269 [internal quotations omitted, emphasis in original].) The Court does not find that Defendant has shown with a high level of certainty that a damage award will not exceed $35,000 in this case.

In light of the foregoing, the Court does not find that Defendant has demonstrated that the instant case is incorrectly classified.

Conclusion

Based on the foregoing, Defendant’s motion to reclassify is denied.   

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Plaintiff is ordered to provide notice of this order.

DATED:  February 7, 2025                                                                           

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Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court