Case Name: Alivia Stricklin v. Security Industry Specialists, Inc., et al.
Case No.: 18-CV-323870

This putative wage and hour class action was dismissed without prejudice on January 9, 2019. Defendant Security Industry Specialists, Inc. (“SIS”) filed a memorandum of costs on February 15. Before the Court is plaintiff’s motion to tax costs, which defendant opposes.

I. Factual and Procedural Background

Plaintiff worked for defendant as an hourly, non-exempt security guard from May to July of 2017. (Complaint, ¶ 8.) She alleged that SIS failed to compensate her and other putative class members for time spent cleaning and maintaining their uniforms and associated expenses, and issued their final wages in the form of an ATM card that triggered fees upon use, was not fully cashable, and could not be used at all financial institutions. (Id. at ¶ 18.)

Based on these allegations, plaintiff brought claims for (1) violation of Labor Code section 226 by failing to provide accurate itemized wage statements; (2) violation of Labor Code sections 558, 1194, 1197, and 1197.1 by failing to pay minimum wages; (3) violation of Labor Code sections 510, 558, 1194, and 1197.1 by failing to pay overtime wages; (4) violation of Labor Code section 2802 by failing to reimburse business expenses; (5) violation of Labor Code sections 201-203 by failing to pay wages due at termination; and (6) violations of Business & Professions code section 17200 et seq.

Defendant filed a motion to compel arbitration on June 18, 2018. On July 2, 2018, plaintiff filed a second action against SIS, asserting a single claim under the Private Attorneys General Act (“PAGA”) based on the same facts set forth above. That case, Stricklin v. Security Industry Specialists, Inc. (Super. Ct. Santa Clara County, No. 18-CV-330523) is also pending in this Department. In an order issued on September 24, 2018, the Court granted defendant’s motion to compel arbitration and stayed this action, including the putative class claims, pending the completion of arbitration. Plaintiff subsequently dismissed the action without prejudice.

II. Legal Standard

“Except as otherwise expressly provided by statute, a prevailing party is entitled as a matter of right to recover costs in any action or proceeding.” (Code Civ. Proc., § 1032, subd. (b).) Items explicitly allowed as costs are set forth in Code of Civil Procedure section 1033.5, subdivision (a). Items expressly disallowed as costs are set forth in section 1033.5, subdivision (b). Other costs may be allowed or denied in the court’s discretion. (Code Civ. Proc., § 1033.5, subd. (c)(4).) “Any award of costs shall be subject to the following: [¶] (1) Costs are allowable if incurred, whether or not paid. [¶] (2) Allowable costs shall be reasonably necessary to the conduct of the litigation rather than merely convenient or beneficial to its preparation. [¶] (3) Allowable costs shall be reasonable in amount.” (Code Civ. Proc., § 1033.5, subd. (c)(1)-(3).)

A party seeking costs need only submit a memorandum of costs with a statement by the attorney verifying that, to the best of his or her knowledge, the costs claimed are correct and were necessarily incurred in the case. (See Cal. Rules of Court, rule 3.1700(a)(1).) The party need not attach copies of bills, invoices, and so forth. (See Jones v. Dumrichob (1998) 63 Cal.App.4th 1258, 1267.) “[T]he verified memorandum of costs is prima facie evidence of their propriety, and the burden is on the party seeking to tax costs to show they were not reasonable or necessary.” (Id. at p. 1266.)

[T]he mere filing of a motion to tax costs may be a proper objection to an item, the necessity of which appears doubtful, or which does not appear to be proper on its face. However, [i]f the items appear to be proper charges the verified memorandum is prima facie evidence that the costs, expenses and services therein listed were necessarily incurred by the defendant, and the burden of showing that an item is not properly chargeable or is unreasonable is upon the [objecting party].

The court’s first determination, therefore, is whether the statute expressly allows the particular item, and whether it appears proper on its face. If so, the burden is on the objecting party to show them to be unnecessary or unreasonable.

(Nelson v. Anderson (1999) 72 Cal.App.4th 111, 131, internal citations and quotations omitted.)

III. Analysis

Plaintiff moves to strike all of the costs requested by SIS on the ground that costs are not recoverable by an employer under Labor Code section 1194. (See Lab. Code, § 1194, subd. (a) [“any employee receiving less than the legal minimum wage or the legal overtime compensation applicable to the employee is entitled to recover in a civil action the unpaid balance of the full amount of this minimum wage or overtime compensation, including interest thereon, reasonable attorney’s fees, and costs of suit”]; Ling v. P.F. Chang’s China Bistro, Inc. (2016) 245 Cal.App.4th 1242, 1253 [“Because section 1194 provides only for a successful plaintiff to recover attorney fees and costs, it is a one-way fee shifting statute precluding an employer from collecting fees and costs even if the employer prevails on a minimum wage or overtime claim.”].) She notes that her own request for costs in her complaint was made under Labor Code sections 1194 and 2802 (addressing indemnification of employees’ business expenses) only, although she does not explain how this impacts defendant’s request for costs.

Defendant responds that plaintiff did not limit her complaint to a claim under Labor Code section 1194, and notes that while some of her additional claims were derivative of the section 1194 claim, others were based on a different theory arising from SIS’s alleged payment of wages using an ATM card. It cites Ramos v. Garcia (2016) 248 Cal.App.4th 778 for the proposition that the mere inclusion of a section 1194 claim does not mean that fees and costs associated with other claims asserted in the same action are unrecoverable. Ramos expressly did not address an award of costs, although it suggested they were available to a prevailing defendant in a wage and hour action including a claim under section 1194. (See id. at p. 793 [“nothing we say here regarding the unavailability of statutory attorney fees is intended to preclude Respondent from the recovery of ordinary costs of suit (not attorney fees), pursuant to Code of Civil Procedure section 1032”].)

While cited by neither party, Plancich v. United Parcel Service, Inc. (2011) 198 Cal.App.4th 308 directly addressed the issue presented here and held that a prevailing employer may recover costs, as opposed to attorney fees, in an action asserting claims under section 1194 and other statutes. Plancich explained:

[T]he plain language of the statutes is unambiguous—Code of Civil Procedure section 1032, subdivision (b) requires express statutory language exempting a prevailing party from recovering his costs, and section 1194 does not contain language barring a prevailing employer from collecting his costs.

(Plancich v. United Parcel Service, Inc., supra, 198 Cal.App.4th at p. 314.)

Plancich is consistent with discussion in Ling v. P.F. Chang’s China Bistro, Inc., supra, 245 Cal.App.4th 1242, which notes that “[i]n the absence of a specific Labor Code provision, costs are awarded in employment dispute matters under Code of Civil Procedure section 1032,” and “[t]he opposing party is not entitled to an offset” as to costs. (At pp. 1253-1254.) While Ling also states that section 1194 “preclude[s] an employer from collecting fees and costs even if the employer prevails on a minimum wage or overtime claim” (at p. 1253, italics added), this statement is inconsistent with the language of the statute, which does not “preclude” any party from recovering fees or costs, but rather authorizes employees to recover those items. The analysis in Ling focuses on attorney fee awards under section 1194, and it is not clear that the issue of costs as distinguished from fees was raised by the defendant on appeal. Finally, Ling does not address Plancich even though that case was decided several years before Ling. For these reasons, the Court will follow the clear and well-reasoned holding of Plancich rather than the unsupported statement in Ling, which appears to be dictum.

The Court thus finds that defendant is entitled to recover its costs under section 1032. There can be no dispute that SIS is the prevailing party under this statute. (See Code Civ. Proc., § 1032, subd. (a)(4) [“a defendant in whose favor a dismissal is entered” is a prevailing party].) As plaintiff does not challenge the propriety of any specific item of costs requested by defendant, her motion will be denied in its entirety.

IV. Conclusion and Order

Plaintiff’s motion to tax costs is DENIED. SIS shall recover the costs claimed in its memorandum of costs filed on February 15, 2019.

The Court will prepare the order.