Judge Theresa M. Traber, Case 21STCV30347 2022-08-04 Tentative Ruling

Judge: Theresa M. Traber, Case: 21STCV30347, Date: 2022-08-04 Tentative Ruling

Case Number: 21STCV30347 Hearing Date: August 4, 2022 Dept: 47

Tentative Ruling

Judge Theresa M. Traber, Department 47

HEARING DATE: August 4, 2022 TRIAL DATE: July 31, 2023

CASE: Enrique Chavero v. Secure Guard Security Services, Inc.

CASE NO.: 21STCV30347

MOTION FOR LEAVE TO FILE THIRD AMENDED COMPLAINT

MOVING PARTY: Plaintiff Enrique Chavero

RESPONDING PARTY(S): Defendants Secure Guard Security Services, Inc., and Ahmad Zaki Hamidi

CASE HISTORY:

· 08/17/21: Complaint filed.

· 09/20/21: First Amended Complaint Filed.

· 12/22/21: Second Amended Complaint Filed.

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

This is a wrongful termination, wage and hour violation, and PAGA action. Plaintiff alleges that his employer committed various Labor Code and wage and hour violations against both himself and other employees. Plaintiff further alleges that Defendants retaliated against him for complaining internally regarding these violations, ultimately terminating his employment.

Plaintiff seeks leave to file a third amended complaint to remove unsupported allegations and amend the eighth cause of action under the Private Attorneys General Act of 2004 to include a violation of Labor Code section 2802.

TENTATIVE RULING:

Plaintiff’s motion for leave to file a third amended complaint is GRANTED. Plaintiff is ordered to file his Third Amended Complaint as a standalone document within five days of this order.

DISCUSSION:

Motion for Leave to File Second Amended Complaint

The Court may, “at any time before or after commencement of trial, in the furtherance of justice, and upon such terms as may be proper, . . . allow the amendment of any pleading.” (Code Civ. Proc. § 576.) A motion to amend a pleading before trial must meet the following requirements:

(a) Contents of motion

A motion to amend a pleading before trial must:

(1) Include a copy of the proposed amendment or amended pleading, which must be serially numbered to differentiate it from previous pleadings or amendments;

(2) State what allegations in the previous pleading are proposed to be deleted, if any, and where, by page, paragraph, and line number, the deleted allegations are located; and

(3) State what allegations are proposed to be added to the previous pleading, if any, and where, by page, paragraph, and line number, the additional allegations are located.

(b) Supporting declaration

A separate declaration must accompany the motion and must specify:

(1) The effect of the amendment;

(2) Why the amendment is necessary and proper;

(3) When the facts giving rise to the amended allegations were discovered; and

(4) The reasons why the request for amendment was not made earlier.

(CRC 3.1324.)

Contents of Motion

Plaintiff attached a copy of the proposed third amended complaint to the Declaration of Kelly Y. Chen filed with this motion. Plaintiff has complied with California Rule of Court 3.1324(a)(1).

Plaintiff has also indicated which allegations are proposed to be added or deleted by page, paragraph, and line number, as required by California Rule of Court 3.1324(a)(2) and (a)(3). (Notice of Motion, at p. 2.)

Thus, the Court finds that Plaintiff has complied with the requirements for the motion itself.

Supporting Declaration

The Declaration of Attorney Kelly Y. Chen accompanying the motion states that the effect of the proposed amendments is to remove allegations regarding unpaid wage claims and rest break claims and to add allegations regarding violation of Labor Code section 2802 to the eighth cause of action. (Chen Decl. ¶ 2.) The Declaration complies with Rule 3.1324(b)(1) by stating the effect of the proposed amendments.

The Declaration states the amendments are necessary and proper because they are in furtherance of justice by clarifying the nature and scope of Plaintiff’s claims, thereby minimizing any confusion during discovery or trial. (Chen Decl. ¶ 7.) The Declaration complies with Rule 3.1324(b)(2) by stating why the amendments are necessary and proper.

Defendants contend that the Declaration does not explain when the facts giving rise to the amended allegations were discovered, as required by California Rule of Court 3.1324(b)(3), or why amendment was not sought earlier, as required by Rule 3.1324(b)(4). Counsel for Plaintiff states that she discovered that the Second Amended Complaint included “erroneous factual allegations related to unpaid wage and rest break violations,” attributing them to typographical errors caused by her office’s inadvertence and mistake when drafting the original complaint. (Chen Decl. ¶ 4.) This statement is plainly insufficient to satisfy the requirements of the rule, as it is ambiguous as to time and characterizes substantive revisions to the Complaint as mere “typographical errors.”

However, in the Supplemental Declaration of Attorney Chen filed in support of Plaintiff’s reply papers, Plaintiff’s Counsel states that, in May of 2022, Counsel for Plaintiff discovered that the operative complaint contained erroneous factual allegations relating to unpaid wage and rest break violations while Plaintiff was preparing responses to Defendants’ March 1, 2022 discovery requests. (Chen Supp. Decl. ¶ 10.) Plaintiff’s counsel also states that, between April and May of 2022, she learned that Defendants had violated Labor Code section 2802 by failing to reimburse Plaintiff for all business expenditures. (Chen Supp. Decl. ¶ 12.) Plaintiff’s counsel states that she met and conferred with Defendants’ counsel in mid-June of 2022 regarding amendment to the Complaint. (Chen Dec. ¶ 5.) The motion was filed on June 23, 2022. Taking into account the supplemental declaration filed by Attorney Chen, and in light of the liberal standard for permitting leave to amend, (see, e.g., Kittredge Sports Co. v. Superior Court (1989) 213 Cal.App.3d 1045, 1047), the Court concludes that Plaintiff has substantially complied with the requirements of Rule 3.1324(b)(3)

and (4).

Defendants’ Opposition

Defendants oppose Plaintiff’s motion for leave to file the TAC on the grounds that the motion is untimely amounting to inexcusable delay, prejudicial to Defendant, and fails to state facts sufficient to support a cause of action for violation of Labor Code section 2802.

1. Delay

Inexcusable delay in filing a motion to amend is a basis to deny leave to amend. (Roemer v. Retail Credit Co. (1975) 44 Cal.App.3d 926, 939-40.) The Court may deny leave to amend when a party has knowledge of facts that might justify amendment but does not act promptly. (See, e.g., P&D Consultants Inc. v. City of Carlsbad (2010) 190 Cal.App.4th 1332, 1345.)

Defendants contend that Plaintiff waited a year and filed three versions of the Complaint without seeking a claim for reimbursement of business-related expenses under Labor Code section 2802 or removing erroneous allegations. Defendants contend that Plaintiff has failed to explain how these allegations were not discovered previously. In reply, Plaintiff contends that the facts supporting the amendments were only discovered after receiving substantive responses to Plaintiff’s discovery requests, following several months of discovery disputes, including multiple sets of discovery propounded by Plaintiff (Chen Supp. Decl. ¶¶ 6, 9, 14) and an informal discovery conference, (Id. ¶ 13), with some discovery responses still outstanding (Id. ¶ 15.) In light of the liberal standard for permitting leave to amend, the Court finds that Defendants have not satisfactorily demonstrated why the Court should deny leave to amend on this basis.

2. Statute of Limitations

The Court’s discretion to allow amendments to the pleadings “should be exercised liberally in favor of amendments, for judicial policy favors resolution of all disputed matters in the same lawsuit.” (Kittredge Sports Co. v. Superior Court (1989) 213 Cal.App.3d 1045, 1047.) Ordinarily, the court will not consider the validity of the proposed amended pleading in ruling on a motion for leave since grounds for a demurrer or motion to strike are premature. The court, however, does have discretion to deny leave to amend where a proposed amendment fails to state a valid cause of action as a matter of law and the defect cannot be cured by further amendment. (See California Casualty General Ins. Co. v. Superior Court (1985) 173 Cal.App.3d 274, 281 (overruled on other grounds by Kransco v. American Empire Surplus Lines Ins. Co. (2000) 23 Cal.4th 390).)

Defendants contend that the new claim for violation of Labor Code section 2802 is time-barred by the one-year statute of limitations. PAGA actions are subject to a one-year statute of limitations. (Brown v. Ralphs Grocery Co. (2018) 28 Cal.App.5th 824, 839, citing Code Civ. Proc. § 340(a).) Defendants also contend that this claim is barred because Plaintiff did not file notice with the LWDA within the applicable statute of limitations period. (See Esparza v. Safeway Inc. (2019) 36 Cal.App.5th 42, 59.)

Defendants contend that Plaintiff alleges that he was terminated on September 30, 2020. (SAC ¶¶14, 16.) According to Defendants, Plaintiff’s initial notice to the LWDA, dated July 7, 2021, did not allege a failure to reimburse for business related expenses. (Declaration of Nathan M. Robinson ISO Opp. ¶ 2, Exh. A.) However, the May 10, 2022 notice does contain those allegations. (Id. ¶ 3, Exh. B.) Defendants contend that the May 10, 2022 notice is untimely.

In reply, Plaintiff contends that the relation-back doctrine applies to the new claims. Defendants asserted in the opposition, in anticipation of this argument, that the relation-back doctrine does not apply when a party fails to comply with the administrative requirements of PAGA to give notice with the LWDA, relying on Brown v. Ralphs Grocery Company in support of their position. (Brown, supra, 28 Cal.App.5th at 841.) However, as Plaintiff correctly observes, Brown held that the relation-back doctrine does apply if any of the later-alleged claims relate back to adequately-noticed claims for violations. (Id. at 841-42.) Plaintiff contends in reply that the claims relate back to the original 2021 notice, the adequacy of which is not challenged. Plaintiff contends that the original notice alleged that Defendants required employees to stay on-duty during rest periods and meal periods. (Robinson Decl. Exh. A pp. 2-3.) Plaintiff contends that one type of unlawful on-duty break practice is requiring employees to monitor their cell phones. (See Augustus v. ABM Security Services Inc. (2016) 2 Cal.5th 257.) The original notice does not specifically allege that employees were required to monitor their cell phones. (Robinson Decl. Exh. A.) However, Plaintiff contends that if the LWDA or Defendants investigated the allegations in the original notice, they would have investigated whether employees were required to have or monitor a cell phone during the alleged on-duty rest periods and therefore would have discovered the failure to reimburse for cell phone expenses that is alleged in the new notice.

In light of the liberal standard to permit leave to amend and the presumption against considering the validity of a proposed amendment in ruling on a motion for leave, the Court cannot conclude as a matter of law that leave to amend should be denied on this basis. Even if the proposed claim is barred by the statute of limitations, that would not be sufficient to deny leave to amend for failure to state a cause of action, as Plaintiff asserts multiple bases for the eighth cause of action that can independently support a PAGA claim for relief.

3. Prejudice

Defendant contends that Plaintiff should not be granted leave to amend as doing so would cause substantial unfair prejudice to Defendant.

Leave to amend should be denied when the proposed amendment will unfairly prejudice the defendant. (Magpali v. Farmers Group, Inc. (1996) 48 Cal.App.4th 471, 487.) Prejudice exists where the amendment would result in loss of critical evidence, added costs of preparation, increased burden of discovery, etc. (Ibid. at pp. 486-488.) Courts have consistently refused to allow an amendment when it would require a defendant to conduct new discovery and would shift the tenor of the case. (Ibid. at pp. 486-487 [finding that prejudice justified denial of leave to amend when it would require the deposition of new witnesses and “would have changed the tenor and complexity of the complaint and its original focus”]; Gamble v. General Foods Corp. (1991) 229 Cal.App.3d 893, 897 [denying leave to amend where “amendment of the pleadings would necessitate new discovery”].)

Defendants contend that they would be substantially prejudiced by the new claims because the new legal theories and allegations would require new discovery. In reply, Plaintiff contends that the proposed amendments will partially offset this burden by relieving Defendants of having to defend against erroneous allegations. Plaintiff also contends that the allegations arise from the same set of illegal wage and hour practices that give rise to the PAGA cause of action as a whole. Finally, Plaintiff contends that trial remains a year away, and thus discovery remains open without necessitating a continuance of the trial.

Here, the Court cannot conclude that the proposed amendment will unfairly prejudice Defendants. Although the proposed amendments, asserting new legal theories, will certainly require new discovery, the proposed amendments also eliminate purportedly erroneous allegations to offset the burden on Defendants. Further, the length of time between this motion and trial provides Defendants with sufficient opportunity to conduct any necessary discovery and motion practice regarding the new allegations. Additionally, Plaintiff has shown that the timing of these amendments and the new allegations stems from the lengthy discovery dispute between the parties in this case. Defendants cannot claim that they are unfairly prejudiced when they have directly contributed to their own current circumstances through their conduct in this matter.

CONCLUSION:

Accordingly, Plaintiff’s motion for leave to file a third amended complaint is GRANTED. Plaintiff is ordered to file his Third Amended Complaint within five days of this Order.

Moving Party to give notice.

IT IS SO ORDERED.

Dated: August 4, 2022 ___________________________________

Theresa M. Traber

Judge of the Superior Court

Any party may submit on the tentative ruling by contacting the courtroom via email at Smcdept47@lacourt.org by no later than 4:00 p.m. the day before the hearing. All interested parties must be copied on the email. It should be noted that if you submit on a tentative ruling the court will still conduct a hearing if any party appears. By submitting on the tentative you have, in essence, waived your right to be present at the hearing, and you should be aware that the court may not adopt the tentative, and may issue an order which modifies the tentative ruling in whole or in part.