Case Name: Joe Phebus v. San Jose, LLC, et al.
Case No.: 17-CV-314199

This is a putative class action alleging wage statement violations by defendants San Jose, LLC dba Regional Medical Center of San Jose and HCA Healthcare. Before the Court is defendants’ demurrer to the complaint on the ground that the action should be abated in favor of a related lawsuit. Plaintiff opposes defendants’ demurrer.

I. Factual and Procedural Background

Plaintiff filed this action on August 8, 2017, alleging wage statement violations arising from defendants’ failure to identify the accurate rates of overtime pay and total hours worked on wage statements for employees who worked overtime. (Complaint, ¶ 19.) Plaintiff’s complaint asserts claims for (1) violation of Labor Code section 226 and (2) penalties under the Private Attorneys General Act (“PAGA”).

Before this action was filed, another plaintiff filed and served a class action against defendants alleging (1) failure to pay minimum wages; (2) failure to pay overtime; (3) failure to pay seventh day overtime; (4) day of rest violations; (5) failure to provide meal periods; (6) failure to provide rest breaks; (7) a derivative claim for failure to provide accurate itemized wage statements; (8) an independent claim for failure to provide accurate itemized wage statements, alleging failure to identify the name and address of the legal entity that employs the plaintiffs; (9) failure to pay all wages due at termination; (10) PAGA penalties; (11) unfair business practices; and (12) declaratory relief. That action, Gerardo Segura v. San Jose, LLC, et al. (Super. Ct. Santa Clara County, No. 17-CV-304860) (hereinafter, “Segura”), has also been assigned to this Department. According to a case management conference statement in that case, the Segura plaintiff has served initial written discovery requests and the parties are engaged in meet and confer efforts regarding the Belaire-West process. No motion to certify the class has been filed.

In the present demurrer, defendants contend that this action should be abated in favor of Segura pursuant to the statutory plea in abatement and the rule of exclusive concurrent jurisdiction. The parties met and conferred regarding these issues at a case management conference before the Court, but were unable to agree to a resolution.

II. Requests for Judicial Notice

Defendants’ request for judicial notice of the complaint in Segura is GRANTED. (Evid. Code, § 452, subd. (d).)

Plaintiff’s request for judicial notice of his PAGA letter in this action is DENIED. (See Ross v. Creel Printing & Publishing Co., Inc. (2002) 100 Cal.App.4th 736, 744 [declining to take judicial notice of District Attorney’s letter that did not fall into any of the categories for mandatory or permissive judicial notice under section 451 or 452]; California School Boards Ass’n v. State Bd. of Educ. (2010) 186 Cal.App.4th 1298, 1327, fn.20 [content of correspondence not a proper subject of judicial notice].) In any event, the content of plaintiff’s PAGA letter is not material to the Court’s ruling.

III. Legal Standard

“The pendency of another earlier action growing out of the same transaction and between the same parties is a ground for abatement of the second action.” (Leadford v. Leadford (1992) 6 Cal.App.4th 571, 574.) A defendant may assert the pending action as a bar either by demurrer, or where fact issues must be resolved, by answer and subsequent motion pursuant to Code of Civil Procedure section 597. (Ibid.) In either case, if the court determines a pending action raises substantially the same issues between the same parties, it must enter the interlocutory judgment specified in Code of Civil Procedure section 597. (Ibid.) “In determining whether the causes of action are the same for purposes of pleas in abatement, the rule is that such a plea may be maintained only where a judgment in the first action would be a complete bar to the second action.” (Plant Insulation Co. v. Fibreboard Corp. (1990) 224 Cal.App.3d 781, 787-788.)

Related to the statutory plea in abatement is the rule of exclusive concurrent jurisdiction, which “has been interpreted and applied more expansively, and therefore may apply where the narrow grounds required for a statutory plea of abatement do not exist.” (Plant Insulation Co. v. Fibreboard Corp., supra, 224 Cal.App.3d at p. 788.) “Unlike the statutory plea of abatement, the rule of exclusive concurrent jurisdiction does not require absolute identity of parties, causes of action or remedies.” (Ibid.) “If the court exercising original jurisdiction has the power to bring before it all the necessary parties … [and] to litigate all the issues and grant all the relief to which any of the parties might be entitled under the pleadings,” the court should stay the second action pending resolution of the first. (Ibid.) Nevertheless, while complete identity between the parties and remedies sought is not required, “the issues in the two proceedings must be substantially the same and the individual suits must have the potential to result in conflicting judgments” for the rule to apply. (County of Siskiyou v. Superior Court (Environmental Law Foundation) (2013) 217 Cal.App.4th 83, 91.)

Under either doctrine, “[a]n order of abatement issues as a matter of right[,] not as a matter of discretion[,] where the conditions for its issuance exist.” (Lawyers Title Ins. Corp. v. Superior Court (Harrigfeld) (1984) 151 Cal.App.3d 455, 460.)

IV. Analysis

Both Segura and the instant action are putative class actions in which class certification has not yet been granted or denied. The parties do not cite, and the Court is not aware of, any authority addressing a plea in abatement or the rule of exclusive concurrent jurisdiction under these circumstances.

However, since neither the Segura plaintiff nor the plaintiff herein has sought or obtained authorization to represent other putative class members, the “absolute identity of parties” required to support a statutory plea in abatement is lacking in these cases. (See Plant Insulation Co. v. Fibreboard Corp., supra, 224 Cal.App.3d at p. 788.) This is true of the PAGA claims in these actions as well, since “nothing in the PAGA statutory scheme forecloses separate but similar actions by different employees against the same employer.” (Julian v. Glenair, Inc. (2017) 17 Cal.App.5th 853, 866-867 [noting that collateral estoppel protects the employer under these circumstances].) Relatedly, “[i]n determining whether the causes of action are the same for purposes of pleas in abatement, the rule is that such a plea may be maintained only where a judgment in the first action would be a complete bar to the second action.” (Plant Insulation Co. v. Fibreboard Corp., supra, 224 Cal.App.3d at pp. 787-788.) Courts have held that pre-certification rulings in class actions do not have this effect on putative class members. (See Bridgeford v. Pacific Health Corp. (2012) 202 Cal.App.4th 1034, 1043 [order denying class certification does not have collateral estoppel effect; “if no class was certified by the court in the prior proceeding, the interests of absent putative class members were not represented”]; Bufil v. Dollar Financial Group, Inc. (2008) 162 Cal.App.4th 1193, 1204 [new class representative’s proposal of “a class that on its face attempts to correct flaws identified in [a prior putative class action] resulting in denial of certification” was not subject to issue preclusion]; but see Alvarez v. May Dept. Stores Co. (2006) 143 Cal.App.4th 1223 [order denying class certification does have collateral estoppel effect].) Consequently, at least prior to certification of either class, the complete identity of parties and claims required to support a plea in abatement is not present here.

A closer question is whether exclusive concurrent jurisdiction applies. “Unlike the statutory plea of abatement, the rule of exclusive concurrent jurisdiction does not require absolute identity of parties, causes of action or remedies.” (Plant Insulation Co. v. Fibreboard Corp., supra, 224 Cal.App.3d at p. 788.) Still, “the issues in the two proceedings must be substantially the same and the individual suits must have the potential to result in conflicting judgments” for the rule to apply. (County of Siskiyou v. Superior Court, supra, 217 Cal.App.4th at p. 91.) Here, while both actions allege wage statement violations by the same defendants, the alleged violation in this action is a failure to identify the accurate rates of overtime pay and total hours worked for employees who worked overtime, notwithstanding whether these employees were adequately compensated. Segura alleges a failure to identify the correct employer’s name and address and a failure to present accurate information resulting from the non-payment of wages owed due to various wage and hour violations. Thus, the issues presented by the two lawsuits are distinct. Further, the Court expects that conflicting judgments can be avoided here, since the actions have been related and assigned to the same department in the same court. Parallel class actions like these are routinely resolved in a manner that excludes the claims pending in the other action, and the Court presumes such a resolution may be achieved here as well.

Under these circumstances, neither the statutory plea in abatement nor the rule of exclusive concurrent jurisdiction applies.

V. Conclusion and Order

Defendants’ demurrer is OVERRULED.

The Court will prepare the order.