Judge: William D. Claster, Case: JCCP5231, Date: 2023-08-25 Tentative Ruling

Plaintiff Josue Uribe's Notice of Motion and Renewed Motion for Preliminary Approval of Class Action Settlement ROA 57

The Court has reviewed the supplemental briefing filed in response to the prior minute order. The motion for preliminary approval of the class action settlement between Uribe and Crown is DENIED because the cell phone reimbursement claims included in the PAGA release do not relate back to Uribe’s original LWDA letter.

I.            BACKGROUND

As discussed in Uribe v. Crown Building Maintenance Co. (2021) 70 Cal.App.5th 986, Uribe’s 2016 pre-filing letter to the LWDA did not exhaust administrative remedies regarding cell phone reimbursement. As a result, the Court of Appeal overturned Judge Sanders’ approval of the parties’ PAGA settlement, which had the effect of nullifying the entire settlement agreement.

Uribe filed an amended letter with the LWDA on June 24, 2022. (Alizadeh Decl., Ex. 17.) This letter included a description of the factual basis for the cell phone reimbursement claim. (Id., at p. 3.)

Intervenor Garibay contends the statute of limitations has long since run on Uribe’s ability to bring a PAGA claim based on unreimbursed cell phone use. Uribe’s employment ended in March 2015. (Alizadeh Decl., ¶ 18.) Thus, to bring a PAGA claim based on unreimbursed cell phone use, he had to exhaust administrative remedies by March 2016. (See Brown v. Ralphs Grocery Co. (2018) 28 Cal.App.5th 824, 839 [“because plaintiff's employment terminated in December 2009, to timely pursue PAGA claims for alleged violations occurring during her employment or upon her discharge, plaintiff had until December 2010 to file her PAGA notice.”].) Relying on Brown, Garibay argues the June 2022 LWDA letter was untimely, and Uribe’s cell phone claim is barred. (See ibid. [2016 letter alleging new predicate Labor Code violations untimely when employment ended in 2009].) Uribe replies that his 2022 letter relates back to his 2016 letter.

II.          PAGA—Relation Back

A.               Norgart

The Court previously sought further briefing on several topics, including relation back. Specifically, the Court asked whether the cell phone reimbursement claims raised in Uribe’s amended LWDA letter related back to his original letter under Norgart v. Upjohn Co. (1999) 21 Cal.4th 383 or Soldinger v. Northwest Airlines, Inc. (1996) 51 Cal.App.4th 345, two cases cited in Brown v. Ralphs Grocery Co. (2018) 28 Cal.App.5th 824.

To the extent Norgart and Soldinger state different standards for determining relation back, the Court finds Norgart is the standard applicable in the context of PAGA claims and amended LWDA letters. In addition to Brown, the Court of Appeal in Esparza v. Safeway, Inc. (2019) 36 Cal.App.4th 42 cites Brown to apply Norgart’s formulation in a PAGA case. (See id., at p. 60.) With two cases applying Norgart, the Court believes this is the better course.

Under Norgart, “The relation-back doctrine requires that the amended complaint must (1) rest on the same general set of facts, (2) involve the same injury, and (3) refer to the same instrumentality, as the original one.” (Norgart, supra, 21 Cal.4th at pp. 408-409 [emphasis original].) The cell phone claims in Uribe’s amended letter fail the first and third prongs of Norgart.

First, the claims do not arise from the same general set of facts. Uribe’s argument that both uniform issues and cell phone issues generally involve a failure to reimburse collapses the first and second prongs—same facts and same injury—into one. Perhaps the facts would support a “general failure to reimburse” if Uribe’s original letter had said something like “Crown has a practice of failing to reimburse its employees in violation of § 2802. As one example, and without limitation, it fails to reimburse employees for uniform expenses.”

Here, however, “Uribe’s PAGA notice stated the alleged Labor Code violations were ‘based on the theory that Employee was entitled to reimbursement of expenses incurred for maintaining his uniform and purchasing his own slip resistant shoe[s] that he had no other use or need for other than to perform his job.’ Uribe described the factual basis of the section 2802 reimbursement claim as follows: ‘failing to reimburse Employee for Expenses incurred for purchasing slip resistant shoes and maintaining his uniform.’” (Uribe v. Crown Building Maintenance Co. (2021) 70 Cal.App.5th 986, 992 [hereafter Uribe v. Crown].) This doesn’t describe a general practice of non-reimbursement, but specific non-reimbursement for uniform expenses. And, as the Court of Appeal noted, the letter had “no ‘facts’ whatsoever” about cell phone reimbursement. (Id., at p. 1005.)

Second, the claims do not involve the same instrumentality. Uribe identifies no cases that explain what it means to be the “same instrumentality.” Garibay cites an unpublished case, in violation of the Rules of Court, which the Court has not considered. The Court’s own research uncovered Coronet Manufacturing Co. v. Superior Court (1979) 90 Cal.App.3d 342, an instructive case. In Coronet, the plaintiffs’ minor daughter was electrocuted in her bathroom. The original complaint alleged a hair dryer caused the electrocution, and the named defendants were parts suppliers for the hair dryer. An amended complaint filed well outside the statute of limitations named a new company, Coronet, as a former Doe defendant. It further alleged that Coronet had manufactured a table lamp, and the table lamp caused the electrocution. (Id., at p. 344.)

The Court of Appeal explained that the amended complaint did not relate back as pled: “[A]lthough there was just the single electrocution, the first complaint pleaded that the offending instrumentality was the hair dryer and the ‘accident’ was the use of that hair dryer. The amended complaint alleges that the instrumentality was a table lamp and the ‘accident’ was the use of the lamp.” (Id., at p. 347.)

The same analysis holds here. A failure to reimburse is a failure to reimburse, just as an electrocution is an electrocution. But a failure to reimburse for uniform expenses isn’t a failure to reimburse for cell phone expenses, just as an electrocution by hair dryer isn’t the same as an electrocution by lamp. Under Norgart, Uribe’s cell phone claims do not relate back.

B.               Soldinger

Even if Soldinger is the proper test, Uribe’s claims do not relate back. Under that case, “Incidents not included in a DFEH charge can be included in the subsequently filed lawsuit if they would necessarily have been discovered by investigation of the charged incidents, i.e., if the allegations in the civil complaint were ‘like or related’ to those specified in the DFEH charge.” (51 Cal.App.4th at p. 381.)

Again, the original letter mentions only a practice of not reimbursing for uniform expenses. It doesn’t suggest a general non-reimbursement practice, of which uniform expenses are just one example. The Court doubts the LWDA would necessarily uncover evidence of cell phone issues in its investigation of the letter’s allegations because, from the terms of the letter, the LWDA could limit its investigation to uniform expenses.

And as Garibay points out, the history of this case suggests the LWDA wouldn’t necessarily have uncovered cell phone issues in its own investigation. As the Court of Appeal explained, Uribe’s original letter, complaint and FAC mentioned only uniform expenses. It was Crown, not Uribe, that first brought up cell phone expenses, when Crown told Uribe it considered Garibay’s case related. (Uribe v. Crown, 70 Cal.App.5th at p. 993.) Only when settlement talks stalled did Uribe begin to consider adding the cell phone claim, at which point Crown proposed a new mediation and turned over about 100 relevant individual documents (plus “thousands” of cell phone records) informally, without an official discovery request from Uribe. (Id., at pp. 993-94.)

Contrary to Uribe’s claim at page 2 of his supplemental brief, his own investigation doesn’t appear to have uncovered the cell phone claims. Crown itself brought cell phone issues to Uribe’s attention. Then Crown proposed mediation and handed Uribe relevant documents voluntarily, without a discovery request. This is consistent with a defendant facing multiple potentially overlapping class or PAGA claims trying to reverse auction a settlement. (The Court is not finding a reverse auction happened here, only noting that Crown’s behavior is consistent with a reverse auction.) In contrast, in the context of a formal investigation of uniform claims by the LWDA, the Court very seriously doubts Crown would voluntarily bring up cell phone claims. Therefore, the Court concludes the LWDA’s investigation of uniform claims would not necessarily have discovered anything about unreimbursed cell phone use.

III.       Conclusion

Because the PAGA claims based on unreimbursed cell phone use do not relate back to Uribe’s original LWDA letter, and because the settlement includes a release of PAGA claims based on unreimbursed cell phone use, the Court denies approval of the settlement as currently written.

Paragraph 100 of the settlement agreement provides: “In the event that . . . the Court does not finally approve the Settlement as provided herein . . . this Settlement Agreement, and any documents generated to bring it into effect, will be null and void.” In Uribe v. Crown, the Court of Appeal interpreted identical language to mean the settlement was null and void for lack of approval of the PAGA release. (See Uribe v. Crown, 70 Cal.App.5th at p. 1006.) The Court therefore assumes the current settlement is null and void. At the hearing, Uribe and Crown should be prepared to discuss how they intend to proceed.