Case Name:   Arturo Hernandez vs. General Electric Company.

Case No.:       1-13-CV-243623

 

This is a putative class action by plaintiff Arturo Hernandez (“Plaintiff”), individually and on behalf of similarly-situated persons employed as “Service Technicians” of defendant General Electric Company (“Defendant”) in California within the applicable class period.  Plaintiff sues for unpaid wages, unpaid overtime compensation, deficient wage statement penalties, and unpaid compensation for meal and rest period violations.

 

Plaintiff alleges that Defendant operates an appliance division called GE Appliances (“GEA”), and within GEA is a business segment called GE Consumer Home Service, which employs Service Technicians to service and repair GEO appliances in residential customer homes.[1]  Service Technicians allegedly receive a list of service calls each morning through company-provided computers and drive a company-owned van from their houses to their service calls, but because Service Technicians’ paid work day begins upon arrival at their first service call and ends when they leave their last service call, they are not paid for any work performed before their first service call or after their last service call such as checking the computer to receive a list of service calls for the day, maintaining inventory in their vans, or processing paperwork, and they are not paid for the time spent driving from home to their first call or driving home after the last call.[2]  Plaintiff alleges that Service Technicians are under Defendant’s control during their drive time, as they cannot use the van for personal errands or have non-coworker passengers in the van.[3]  Plaintiff further alleges that Defendant requires putative class members to work through their meal and rest periods and to remain on-duty throughout their shift.[4]

 

The operative Class Action Complaint (“CAC”), filed March 26, 2013, asserts eight causes of action for: (1) failure to pay overtime (violation of California Wage Orders and Cal. Lab. Code §§ 510, 1194, and 1198); (2) failure to provide meal periods (Cal. Lab. Code, §§ 226.7 and 512); (3) failure to provide rest periods (Cal. Lab. Code, §§ 226.7 and 512); (4) failure to pay wages on termination (Cal. Lab. Code, § 203); (5) failure to provide accurate itemized wage statements (Cal. Lab. Code, §§ 226 and 1174); (6) violation of Labor Code section 558; (7) unfair business practices under the Unfair Competition Law (“UCL”) (Cal. Bus. & Prof. Code, §§ 17200-17208); and (8) recovery under the Private Attorneys General Act (“PAGA”) (Cal. Lab. Code, § 2698 et seq.).

 

Plaintiff now moves for class certification.

 

Plaintiff proposes certification of the following class:  “All current and former ‘Service Technicians’ who worked for General Electric Company in the State of California from March 26, 2009 to final judgment.”  Alternatively, Plaintiff proposes certification of three subclasses:  (1) Off-the-Clock Drive Time Subclass:  “All current and former ‘Service Technicians’ who worked any uncompensated time off-the-clock while driving to their first appointment or home from their last appointment of the day, for General Electric Company in the State of California at any time from March 26, 2009 to final judgment.”  (2) Meal and Rest Break Subclass:  “All current and former ‘Service Technicians’ that were denied meal and/or rest breaks while employed by General Electric Company in the State of California at any time from March 26, 2009 to final judgment.”  (3) Ten Hour Shift Subclass:  “All current and former ‘Service Technicians’ who worked shifts lasting ten hours or more while employed by General Electric Company in the State of California at any time from March 26, 2009 to final judgment.”

 

Parties’ Arguments

 

Plaintiff submits that the proposed class of at least 100 members is sufficiently numerous and is ascertainable from Defendant’s employment records.  Plaintiff argues that common issues of law and will predominate because Defendant’s liability is based on uniform policies that were consistently applied to members of the putative class such as Defendant’s policies regarding the use of company-issued vehicles, policies requiring putative class members to check their company-issued laptops for scheduled work assignments, and common policies regarding time-keeping and compensation for commute time.   Plaintiff argues that common questions of law on the meal and rest break claims will predominate because Defendant’s liability is based on its close regulation of all putative class members’ activities, which interfered with their ability to take meal and rest breaks.  Plaintiff submits that the common evidence of Defendant’s liability includes its uniform failure to schedule meal or rest breaks for Service Technicians, the Service Technicians’ inability to tell dispatch when they were going on meal or rest breaks, and Defendant’s time-keeping and compensation policies (e.g., failure to track the start and end times of meals).  Plaintiff argues that his claims are typical of the putative class, as they are based on the same conduct and theories, and he is an adequate class representative because he has no conflicts with the putative class and has a strong interest in establishing liability against Defendant.  Plaintiff argues that his counsel is experienced in wage and hour class litigation.  Finally, Plaintiff argues that a class action is the superior method of deciding the claims of the putative class because it provides an efficient and inexpensive means for employees to recover modest damages.

 

Defendant argues that its meal and rest break policies are in compliance with California law because it tracks meal periods, and the testimony of other Service Technicians show that they are aware of and take off-duty, uninterrupted meal periods by adjusting their schedules.  Defendant argues that Plaintiff has no standing to represent the class regarding his overtime claims because his membership of a union governed by a collective bargaining agreement makes him an “exempt employee” under Labor Code section 514.  Defendant further argues that its overtime policies are in compliance with California law because it pays employees for all hours worked, and de minimis time (e.g., checking daily assignments, calling customers before arrival) and commute time are generally not compensable.  Finally, Defendant argues that Plaintiff is not typical of the class he seeks to represent because he was only one of 20% of Service Technicians who chose to receive his inventory parts at home, he was paid three times more overtime than anyone in his area, and he is a union member with no standing on at least one of the claims in this lawsuit.  Finally, Defendant argues that Plaintiff is not an adequate representative because he lacks credibility (e.g., he was terminated from his previous job for falsifying time records), and he admits to having no familiarity with any practices or policies applicable to Southern California Service Technicians.

 

Judicial Notice

 

Plaintiff requests judicial notice of the civil minutes/Order Certifying Class in a case entitled Campbell v. Best Buy Stores, L.P., et al., U.S. District Court, Central District of California, Case No. LA CV12-07794 JAK (SHx).  “Judicial notice shall be taken of…[t]he decisional…law of this state and of the United States[.]”  (Cal. Evid. Code, § 452, subd. (a).)  The request is GRANTED.

 

Defendant requests judicial notice of a screenshot from the State of California Department of Industrial Relations’ website on the “History of California Minimum Wage,” available at http://www.dir.ca.gov/iwc/minimumwagehistory.htm.[5]  The Court may take judicial notice of the existence of the Department of Industrial Relations’ website posting as an “official act” of the state executive branch.  (See Evid. Code, § 452, subd. (c).)  The request is GRANTED.

 

Legal Standards

 

California Code of Civil Procedure section 382 authorizes class actions “when the question is one of a common or general interest, of many persons, or when the parties are numerous, and it is impracticable to bring them all before the court, one or more may sue or defend for the benefit of all.”

 

“The party seeking certification has the burden to establish the existence of both an ascertainable class and a well-defined community of interest among class members.  [Citations.]  The ‘community of interest’ requirement embodies three factors: (1) predominant common questions of law or fact; (2) class representatives with claims or defenses typical of the class; and (3) class representatives who can adequately represent the class.  [Citation.]  [¶]  The certification question is ‘essentially a procedural one that does not ask whether an action is legally or factually meritorious.’  [Citation.]  A trial court ruling on a certification motion determines ‘whether … the issues which may be jointly tried, when compared with those requiring separate adjudication, are so numerous or substantial that the maintenance of a class action would be advantageous to the judicial process and to the litigants.’  [Citations.]”  (Sav-On, Inc. v. Superior Court (2004) 34 Cal.4th 319, 326.)

 

Discussion

 

“Adequacy of representation depends on whether the plaintiff’s attorney is qualified to conduct the proposed litigation and the plaintiff’s interests are not antagonistic to the interests of the class.  [Citations.]”  (McGhee v. Bank of America (1976) 60 Cal.App.3d 442, 450-451.)  This requirement, along with the other community of interest requirements, “means each member must not be required to individually litigate numerous and substantial questions to determine his [or her] right to recover following the class judgment; and the issues which may be jointly tried, when compared with those requiring separate adjudication, must be sufficiently numerous and substantial to make the class action advantageous to the judicial process and to the litigants.”  (Mora v. Big Lots Stores, Inc. (2011) 194 Cal.App.4th 496, 506 [internal citations and quotation marks omitted].)

 

Defendant argues that Plaintiff is not an adequate class representative due to credibility problems.  Defendant submits that Plaintiff previously worked as a Service Technician for Best Buy where his overtime draw (the highest in his area) prompted an internal investigation and audits that found inaccurate time and record reporting.[6]  After Best Buy gave Plaintiff a performance warning, it was later discovered that Plaintiff again falsified his time records, he admitted as much, and was terminated shortly thereafter.[7]  Plaintiff testified that he could not remember why he was terminated from his employment with Best Buy.[8]  Defendant further submits that throughout Plaintiff’s employment with Defendant, Plaintiff was a poor performer while maintaining an overtime rate of three times his zone average, and was terminated on January 29, 2013 for poor performance.[9]

 

In his reply brief, Plaintiff argues that the evidence provided in support of these allegations is inadmissible character evidence, evidence of a settlement negotiation, and hearsay, and his prior employer’s internal investigation has no actual bearing on his adequacy as a class representative.

 

Lack of credibility may render a class representative inadequate.  (See Jaimez v. Daiohs USA, Inc. (2010) 181 Cal.App.4th 1286, 1307-1308 [plaintiff was not adequate class representative “because he has credibility issues”].)  However, trivial attacks on credibility should not defeat a class representative’s adequacy.  (See CE Design Ltd. v. King Architectural Metals, Inc. (7th Cir. 2011) 637 F.3d 721, 728.)  “For an assault on the class representative’s credibility to succeed, the party mounting the assault must demonstrate that there exists admissible evidence so severely undermining plaintiff’s credibility that a fact finder might reasonably focus on plaintiff’s credibility, to the detriment of the absent class members’ claims.”  (Ibid.)

 

Here, the attacks on Plaintiff’s credibility are not trivial as they relate to Plaintiff’s integrity and honesty in his time-keeping practices.  In a lawsuit based on Defendant’s overtime and meal/rest break practices as demonstrated through its time-keeping policies, any evidence of dishonesty by Plaintiff in his time-keeping practices would distract from the other issues in the case to the detriment of the putative class.  The next issue, then, is whether Plaintiff’s objections on the grounds of character evidence, settlement negotiation, and hearsay are valid.

 

“Evidence of traits of his character other than honesty or veracity, or their opposites, is inadmissible to attack or support the credibility of a witness.”  (Cal. Evid. Code, § 786, italics added.)  Here, the evidence of Plaintiff’s time-keeping practices in his previous employment goes to Plaintiff’s honesty and veracity, and therefore it is not inadmissible under section 786.

 

Under Evidence Code section 1152 subdivision (a), “[e]vidence that a person has, in compromise or from humanitarian motives, furnished or offered or promised to furnish money or any other thing, act or service to another who has sustained or will sustain or claims that he or she has sustained or will sustain loss or damage, as well as any conduct or statements made in negotiation thereof, is inadmissible to prove his or her liability for the loss or damage or any part of it.”  Here, Defendant submits a written statement by Plaintiff from his prior employment in which he states, “I had a conversation today with Lisa Kelleher about daily tracker (time keeping) procedures.  She showed me copies of my daily tracker inaccuracies and how it affects the company’s bottom line.  I made her a promise to be accurate on my time keeping procedures going forward.  I also requested to Lisa to set up a time for a ride along with my lead tech so I can improve on my time keeping procedures. . . . Lisa also pointed out the estimated cost to the company to be $1647.00 in the last six months.”[10]  Defendant also submits a Restitution Agreement in which Plaintiff agreed “to make restitution in the amount of $411.90 pursuant to the terms stated within this agreement.”[11]  Evidence Code section 1152 subdivision (a) would only make such evidence inadmissible “to prove [Plaintiff’s] liability for the loss or damage or any part of it”, which would bar Best Buy from establishing Plaintiff’s liability for the alleged loss.  It would not, however, render the evidence inadmissible on Plaintiff’s credibility in this action.  The evidence of Plaintiff’s admission to inaccuracies in his timekeeping records goes to his credibility and adequacy as a class representative in a wage and hour action.

 

The hearsay objection is well-taken as to the business records attached to the Tobey declaration.  Mr. Tobey refers to and attaches a number of performance documents and Plaintiff’s termination letter, and to the extent he submits these documents for the truth of the matters asserted therein (e.g., that Plaintiff’s overtime draw was disproportionately high and his performance scores were low), it is hearsay.  Under the business records exception to the hearsay rule, a business record is admissible to prove the occurrence or existence of the act, condition or event recorded if: (1) the writing was made in the regular course of business; (2) the writing was made at or near the time of the act, condition or event; (3) the custodian or other qualified witness testifies to its identity and the mode of its preparation; and (4) the sources of information and method of time and preparation were such as to indicate its trustworthiness.  (Cal. Evid. Code, § 1271.)  Mr. Tobey attempts to invoke the business records exception by stating that he “reviewed the file of Plaintiff…which record the contents of which was kept contemporaneously and in the normal course of business.”[12]  However, even if Mr. Tobey was a qualified witness to attest to the identity of these documents, and the documents themselves were sufficiently trustworthy, Mr. Tobey does not discuss the mode of preparation or indicate that the writings were made at or near the time of the acts, conditions or events.

 

As for the Best Buy records, Defendant submits that the records were obtained from a subpoena issued to Best Buy,[13] and Defendant provides an affidavit from Best Buy’s custodian of records satisfying the criteria of the business records exception.[14]  The Best Buy records are sufficient to demonstrate Plaintiff’s credibility issues and render him an inadequate representative.  Plaintiff’s testimony in this action that he could not remember the reasons for his termination from Best Buy is not credible and further undermines his credibility and adequacy.

 

Because admissible evidence seriously undermines Plaintiff’s credibility, the Court finds that Plaintiff is not an adequate class representative, and his motion for class certification is DENIED WITHOUT PREJUDICE.  The Court does not express any opinion on the other requirements for class certification at this time.

 

[1] Class Action Compl. (“CAC”) ¶ 5.

[2] Ibid.

[3] Ibid.

[4] CAC ¶¶ 46, 50.

[5] See Exh. A to Def’s RJN.

[6] Email, Exh. D to Decl. Emily E. Barker ISO Def’s Opp. to Pltf’s Mot. for Class Cert.

[7] Performance Counseling Record, Barker Exh. E; Written Statement and Restitution Agreement, Barker Exh. F.

[8] Depo. Hernandez at p. 19:19-20, Barker Exh. A.

[9] Decl. Christopher Tobey ISO Def’s Opp. to Pltf’s Mot. for Class Cert. ¶¶ 2-5, Exhs. A (Probationary Period Progress Report), B (Probationary Period Progress Report) and C (termination letter).

[10] Barker Exh. F.

[11] Ibid.

[12] Decl. Tobey ¶ 2.

[13] See Decl. Barker ¶ 4 and Barker Exh. B.

[14] Barker Exh. C.