Filed 6/26/20 Linehan-Clodfelter v. Vivint CA1/5

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION FIVE

EZRA LINEHAN-CLODFELTER,

Plaintiff and Appellant,

v.

VIVINT, INC.,

Defendant and Respondent.

A157661

(Alameda County

Super. Ct. No. RG18902225)

The trial court dismissed Ezra Linehan-Clodfelter’s (plaintiff) lawsuit

against his former employer, Vivint, Inc. (Vivint), concluding he lacked standing to pursue a claim for penalties under the Private Attorney General Act of 2004 (PAGA) (Lab. Code, § 2698, et seq.). Relying on our high court’s opinion in Kim v. Reins Internat. California, Inc. (2020) 9 Cal.5th 73 (Kim), we reverse.

FACTUAL AND PROCEDURAL BACKGROUND

Vivint is a residential automation and security company. Plaintiff worked for Vivint as an installation technician. After his employment ended, he filed a putative class action complaint against Vivint. The operative first amended complaint alleged violations of the Labor Code—including failure to pay wages and overtime and failure to provide meal and rest breaks—and an unfair competition cause of action (collectively, individual and class claims). The complaint also alleged a PAGA claim.

Vivint moved to compel arbitration of all claims except the PAGA claim. The court granted the petition and stayed the PAGA claim pending completion of arbitration. Not long after, plaintiff moved to dismiss the individual and class claims without prejudice. In a supporting declaration, plaintiff averred he wished to dismiss the individual and class claims so he could “continue in [his] role as a representative in the currently stayed PAGA claim.” He requested a dismissal without prejudice because he thought a dismissal with prejudice “might prevent [him] from pursuing [his] PAGA claim on behalf of aggrieved employees.” Plaintiff, however, had “no intention of pursuing any of the individual or class claims now or anytime in the future.” He claimed his goal in filing the lawsuit was to help his coworkers, and he intended to do that by litigating the PAGA cause of action.

The court granted the motion, dismissed the individual and class claims without prejudice, and lifted the stay on the PAGA claim. With the stay lifted, Vivint demurred to the PAGA claim. According to Vivint, by abandoning his individual claims, plaintiff was no longer an “aggrieved employee” within the meaning of PAGA. Vivint’s logic was that without an underlying Labor Code claim, plaintiff lacked standing to pursue PAGA penalties on behalf of other employees.

The court agreed and sustained the demurrer without leave to amend. It determined the legislative history demonstrated PAGA “ ‘was not intended to allow an action to be prosecuted by any person who did not have a grievance against his . . . employer for Labor Code violations.’ ” The court reasoned that without an individual or class claim, plaintiff was not an “ ‘aggrieved employee’ ” within the meaning of PAGA. It explained a “litigant cannot assert individual labor claims, then dismiss them without prejudice while disclaiming any future intent to assert them, but still continue to maintain standing as an aggrieved party under PAGA.” The court dismissed the operative complaint with prejudice and entered judgment for Vivint.

DISCUSSION

We review the trial court’s order sustaining the demurrer, including its standing determination, de novo. (Martin v. Bridgeport Community Assn., Inc. (2009) 173 Cal.App.4th 1024, 1031.)

Our high court’s decision in Kim, supra, 9 Cal.5th 73, provides guidance on PAGA standing. There, an employee brought a putative class action lawsuit against his former employer alleging Labor Code violations and a PAGA claim. (Kim, at pp. 82–83.) The trial court ordered the individual claims to arbitration, stayed the PAGA claim, and dismissed the class claims. (Kim, at p. 82.) Later, the employee settled and dismissed the individual claims, “leaving only the PAGA claim for resolution.” (Ibid.) With the stay lifted, the employer “successfully moved for summary adjudication” on the PAGA claim, contending the dismissal of the employee’s individual claims meant he was no longer an “ ‘aggrieved employee’ ” with PAGA standing. (Kim, at pp. 82–83.)

The California Supreme Court reversed. It concluded an employee who settles and dismisses individual Labor Code claims does not lose standing to pursue a PAGA claim. (Kim, supra, 9 Cal.5th at p. 84.) The court noted the plain language of section 2699, subdivision (c) has two requirements for standing: the plaintiff “must be an aggrieved employee, that is, someone ‘who was employed by the alleged violator’ and ‘against whom one or more of the alleged violations was committed.’ ” (Kim, at pp. 83–84.) Kim held the employee satisfied those requirements because he was employed by the alleged violator and because he personally suffered at least one Labor Code violation on which the PAGA claim was based. (Kim, at pp. 82, 84.)

The Kim court rejected the notion that a plaintiff loses standing by settling individual Labor Code claims and accepting “compensation for his injury.” (Kim, supra, 9 Cal.5th at p. 84.) As it explained, the “Legislature defined PAGA standing in terms of violations, not injury,” and the employee became “aggrieved” when “one or more Labor Code violations were committed against him. [Citation.] Settlement did not nullify these violations.” (Ibid.) The court also observed PAGA standing is not “inextricably linked to the plaintiff’s own injury. Employees who were subject to at least one unlawful practice have standing to serve as PAGA representatives even if they did not personally experience each and every violation.” (Kim, at p. 85.)

Kim held PAGA standing does not depend on maintaining an individual Labor Code claim. (Kim, supra, 9 Cal.5th at p. 88.) Our high court found support for this conclusion in section 2699, subdivision (g)(1), which authorizes “stand-alone PAGA claims,” and in various Labor Code statutes imposing “civil penalties without affording a private right of action.” (Kim, at pp. 88, 89.) Finally, the court observed “[n]othing in the legislative history suggests the Legislature intended to make PAGA standing dependent on the existence of an unredressed injury, or the maintenance of a separate, unresolved claim.” (Id. at pp. 90–91.)

Kim compels reversal here. Under Kim, we conclude plaintiff is an “aggrieved employee” with standing to pursue his PAGA claim. Plaintiff alleged he was employed by Vivint, and that he personally suffered at least one Labor Code violation on which the PAGA claim is based. (Kim, supra, 9 Cal.5th at pp. 82, 84; § 2699, subd. (c).) Plaintiff’s dismissal of his individual and class claims did not nullify these alleged Labor Code violations, nor strip plaintiff of his standing to pursue PAGA remedies.

(Kim, at pp. 80, 84.) Dismissing these claims to pursue a stand-alone PAGA claim is—as Kim observes—authorized by section 2699, subdivision (g)(1).

Vivint’s attempt to distinguish Kim is not persuasive. For example, Vivint contends plaintiff did not settle his individual claims as in Kim, but rather “waived,” “forfeited,” or “abandoned” them. Premised on semantics, this argument misses the point. The rule from Kim is an “aggrieved employee” has standing to pursue a PAGA claim, irrespective of whether that employee maintains a separate Labor Code claim. And as discussed above, plaintiff alleged he was an aggrieved employee. Under Kim, this allegation is sufficient, at this stage, to establish standing. To the extent Vivint argues Kim applies only when a plaintiff settles the underlying Labor Code claims, we disagree.

Vivint’s reliance on federal district court cases, including Cabrera v. CVS Rx Servs. (N.D.Cal. Sept. 25, 2018, No. C 17-05803 WHA) 2018 U.S.Dist. Lexis 164625), does not persuade us plaintiff lacks standing to pursue a PAGA claim. The holding in Cabrera—that a plaintiff without underlying Labor Code claims lacks standing to pursue a PAGA claim—has been rejected by our high court in Kim. We are bound by the California Supreme Court’s decision. (Auto Equity Sales, Inc. v. Superior Court (1962) 57 Cal.2d 450, 455.)

Because plaintiff was an “aggrieved employee,” he had standing to pursue a PAGA claim notwithstanding the dismissal of his individual and class claims. The court erred by sustaining Vivint’s demurrer without leave to amend on the basis that plaintiff lacked standing. Reversal is required.

DISPOSITION

The order sustaining the demurrer without leave to amend and the judgment of dismissal are reversed. On remand, the court must vacate the order and judgment, and enter a new order overruling the demurrer. Plaintiff is entitled to costs on appeal. (Cal. Rules of Court, rule 8.278(a)(2).)

 

_________________________

Jones, P. J.

WE CONCUR:

_________________________

Needham, J.

_________________________

Burns, J.

A157661