2015-00176993-CU-OE

Robert Turner vs. Ampac Fine Chemicals, LLC

Nature of Proceeding: Motion to Deny Paga Represtative Status

Filed By: Silva, Aaron B.

The Court rules upon the Motion to Deny PAGA representative status as follows.

In this wage and hour class action, Plaintiffs Robert turner, Sarah Abdallah and Nicholas Dindio (collectively, “Plaintiffs”)allege that Defendant AMPAC Fine Chemicals LLC has violated various labor laws in the misclassification of the Associate Chemists in its employ. The operative Second Amended Complaint, filed December 19, 2017, asserts seven causes of action: (1) unfair competition in violation of California Business & Professions Code section 17200et seq.;(2) failure to pay overtime compensation in violation of California Labor Code section 510, 1194 and 1198; (3) failure to provide accurate itemized statements in violation of Labor Code section 226;

(4) failure to provide wages when due, in violation of Labor Code sections 201, 202 and 203; and, (5) violation of the Private Attorney General Act (Labor Code section 2698).

On December 4, 2017, this Court denied Plaintiffs’ motion for class certification as to the first, second, third and fourth causes of action, concluding that Plaintiffs did not demonstrate that common questions of law or fact would predominate over individual questions as to whether the employees were improperly classified, and whether the members of the proposed class had been subject to the violations alleged.

On January 12, 2018, Defendant filed this motion to deny representative status of Plaintiffs’ PAGA claim. Defendant argues that Plaintiffs’ representative PAGA claim is unmanageable for the same reasons discussed in the Court’s order denying class certification. Defendant further argues that the Court has “inherent equity, supervisory and administrative powers and well as inherent power to control [its] litigation.” (Cottle v. Superior Court(1992) 3 Cal.App.4th1367, 1377.) Plaintiffs argue at length that manageability is not, or at least should not be, a concern for the Court with regard to the PAGA claim because PAGA claims are not subject to the same criteria as determining the certification of class action, as enumerated in Code of Civil Procedure section 382.

The Court agrees that PAGA claims arenotsubject to the same criteria that are applicable to class actions. Class certification requirements “need not be met when an employee’s representative action against an employer is seeking civil penalties under the Labor Code Private Attorneys General Act of 2004.” (Arias v. Superior Court (2009) 46 Cal.4th969, 975.) Under PAGA, an “aggrieved employee” may bring a civil action personally and on behalf of other current or former employees to recover civil penalties for Labor Code violations. (Labor Code § 2699(a).) “A PAGA representative action is … a type of qui tam action.” (Iskanian v. CLS Transportation Los Angeles, LLC (2014) 59 Cal.4th 348, 382.) As the California Supreme Court has explained, a plaintiff asserting a PAGA claim stands in the shoes of the Labor and Workforce Development Agency, whereas a plaintiff in a class action against an employer acts as a representative of other similarly situated employees. (SeeArias v. Superior Court (2009) 46 Cal.4th 969, 980-983 [distinguishing class actions under the Unfair Competition Law from representative actions under PAGA].) While the PAGA statute does not expressly contain a provision or criteria of manageability, PAGAdoesrequire that each Plaintiff must establish that Defendant violated the Labor Code. (Arias, 46 Cal.4th at 987.)

The Parties both cite various cases addressing the issue of manageability of PAGA claims, mostly arising out of California’s federal district courts. Many district courts have stricken or dismissed representative PAGA claims “where the evidence shows that numerous individualized determinations would be necessary to determine whether any class member has been injured. (See, e.g.,Ortiz v. CVS Caremark Corp.(N.D.
Cal. 2014) 2014 U.S. Dist. LEXIS 36833, 2014 WL 1117614, at *4;Amey v. Cinemark USA Inc.(N.D. Cal. 2015) 2015 U.S. Dist. LEXIS 63524, 2015 WL 2251504, at *16; Brown v. Am. Airlines, Inc.(C.D. Cal. 2015) 2015 U.S. Dist. LEXIS 150672, 2015 WL 6735217, at *1;Bowers v. First Student, Inc.(C.D. Cal. 2015) 2015 U.S. Dist. LEXIS 54238, 2015 WL 1862914, at *4;Litty v. Merrill Lynch & Co., Inc.(C.D. Cal. 2014) 2014 U.S. Dist. LEXIS 160448, 2014 WL 5904904, at *3;Fields v. QSP, Inc.(C.D. Cal. 2012) 2012 U.S. Dist. LEXIS 78001, 2012 WL 2049528, at *5.) Though not binding authority on this Court, these federal cases nevertheless are informative and persuasive since there is no published California authority squarely and specifically addressing this issue. (SeeMorris v. Superior Court(2017) 17 Cal.App.5th636, 652-653.)

On the other hand, the Court acknowledgesother federal authority, again not binding, that holds that imposing a manageability requirement “found nowhere in PAGA itself and apparently not imposed upon the government, would ‘obliterate the purpose’ of representative PAGA actions.” (SeePatel v. Nike Retail Servs.(N.D. Cal. 2016) 2016 U.S. Dist. LXIS 172257;Zackaria v. Wal-Mart Stores, Inc.(C.D.Cal. 2015) 142

F.Supp.3d 949, 950.) InZackaria, the court declined to dismiss a representative PAGA action as unmanageable because it believed that doing so “would impose a barrier on such actions that the state law enforcement agency does not face when it litigates those cases itself.” (142 F.Supp.3d at 959.) It noted that “[s]eeking civil penalties on behalf of aggrieved employees may make plaintiff’s case difficult to prove, and may require evidence regarding a significant number of individual employees,” but nevertheless ruled that “the fact that proving his claim may be difficult or even somewhat burdensome for himself and for defendant does not mean that he cannot bring it at all.” (Id.)

In the Court’s view, manageability of a case is not only part of the Court’s inherent power and authority to manage its docket and calendar, but also mirrors the method utilized by state courts with respect to representative Unfair Competition Law claims prior to the passage of Proposition 64. Proposition 64 required representative UCL actions to comply with procedural requirements applicable to class actions suit. Prior to Proposition 64, the California Supreme Court held that a court could decline to entertain a UCL action as a “representative suit.” (Kraus v. Trinity Management Serv. Inc.(2000) 23 Cal.4th 116.) Contrary to Plaintiffs’ assertion, the Court does not find these cases to be irrelevant. The Court acknowledges that some courts have distinguished these pre-Proposition 64 cases on the grounds that “unlike claims under the UCL, which require an individualized determination of the particular restitution due to each plaintiff, PAGA claims require only a showing that a Labor Code violation has occurred.” (Alcantar v. Hobart Serv.(C.D. Cal. 2013) 2013 U.S. Dist. LEXIS 5443, 2013 WL 146323.) In this specific instance, however, where Plaintiffs must first establish whether each Plaintiff is an exempt or non-exempt employee before proceeding with the purported claims of Labor Code violations, the underlying claims necessarily demand multiple and multi-level individualized determinations.

Similar to its opposition to the motion for class certification, Defendant here has made a strong showing that the violations that Plaintiffs allege rely on unique characteristics of the experience of each Plaintiff – and, indeed, each employee – rather than on policies or practices common to “aggrieved employees.” Defendant’s arguments and supporting evidence establish that the Plaintiff group has varying jobs and varying job duties across and among six identified different groups of employees. Plaintiffs have made no attempt to refute the factual allegations Defendants provide to support its argument in this regard, nor have they made any offer to submit any sort of trial plan to assuage the Court’s concerns. It is clear to the Court that there simply is no “standard” means by which determining liability as to one of the named Plaintiffs is representative of all the persons that Plaintiffs purport to represent and that individual inquiries regarding liability once again predominate common questions of fact and law. Of necessity, and to comport with due process considerations, a trial in this case would devolve into a series of dozens of mini-trials to initially determine exempt/non-exempt status, and then any violations of the Labor Code, and the resulting penalty. Such circumstance is indeed unmanageable, at least as it has been presented to the Court in the context of this motion. “In reaching this decision, the Court does not conclude that PAGA claims are unmanageable in general,” nor that PAGA claims must be easily manageable, but only that, based on the facts and arguments presented to date, “the circumstances of this case make the PAGA claim here unmanageable because a multiple of individualized assessments would be necessary.” (Ortiz, supra,2014 U.S. Dist. LEXIS 36833 at *4.)

Accordingly, exercising its inherent authority to manage its own docket, the Court

GRANTS Defendant’s motion in part. While the Court does not believe that, based on the arguments and evidence provided, it can properly grant PAGA representative status to Plaintiffs, the Court nevertheless concludes that Plaintiffs should be permitted to present a proposed means by which the PAGA claims, and Plaintiffs as PAGA representatives, could be efficiently managed going forward. Accordingly, Defendant’s alternative request that Plaintiffs submit a proposed trial plan is GRANTED. Plaintiffs shall provide a proposed trial plan to Defendant and the Court no later than May 18, 2018. Opposition to the proposed trial plan shall be filed no later than June 1, 2018. No reply shall be filed. This hearing shall be continued to June 15, 2018, at which time the Court shall rule on the PAGA representative status.