2017-00222269-CU-WT

Thurston Bershell vs. Dignity Health Methodist Hospital

Nature of Proceeding: Hearing on Demurrer

Filed By: McQueen, Daniel J.

Defendant Dignity Health’s demurrer to Plaintiff Thurston Bershell’s second amended complaint (“SAC”) is ruled upon as follows.

This matter was continued from December 4, 2018 to allow Defendant to comply with CCP § 430.41. It has now done so.

In this employment action Plaintiff alleges numerous causes of action including individual FEHA related causes of action and Labor Code causes of action and also class claims including the tenth and eleventh causes of action for waiting time penalties and wage statement violations under the Labor Code. Defendant demurs only to the tenth and eleventh causes of action.

Tenth Cause of Action (Waiting Time Penalties [Labor Code §§ 201-203])

Defendant’s demurrer is sustained without leave to amend for failure to state facts sufficient to constitute a cause of action.

Plaintiff’s cause of action is premised on the allegation that he and similarly situated employees missed meal and rest periods during their employment and that Defendant failed to pay the employees meal and rest period premiums when their employment ended. (SAC ¶ 82.) Plaintiff contends that the putative class is owed waiting time penalties under Labor Code § 203 as a result.

Labor Code section 226.7, subdivision (c), states:

If an employer fails to provide an employee a meal or rest .

. . period in accordance with a state law . . . the employer shall pay the employee one additional hour of pay at the employee’s regular rate of compensation for each workday that the meal or rest or recovery period is not provided.

(emphasis added).

Labor Code § 226.7 thus sets forth an employer’s requirements with respect to meal and rest periods and provides that the employer shall pay the employee one additional hour of pay for each workday that the meal or rest period is not provided. (Labor Code

§ 226.7(c).) Labor Code § 203 allows for recovery of waiting time penalties by an employee who has separated without being paid and provides for suit to be filed “for these penalties at any time before the expiration of the statute of limitations on an action for the wages from which the penalties arise.” (Labor Code § 203(b).) The California Supreme Court has held that “a section 226.7 action is brought for the nonprovision of meal and rest periods, not for the ‘nonpayment of wages.’” (Kirby v. Immoos Fire Protection, Inc. (2012) 53 Cal.4th 1244, 1255 [emphasis in original].) Following Kirby, the Sixth District Court of Appeal concluded that “section 226.7 cannot support a section 203 penalty because section 203, subdivision (b) tethers the waiting time penalty to a separate action for wages. Because a section 203 claim is purely derivative of ‘an action for wages from which the penalties arise,’ it cannot be the basis of a fee award when the underlying claim is not an action for wages.” (Ling v. P.F. Chang’s China Bistro, Inc. (2016) 245 Cal.App.4th 1245, 1261.)

Plaintiff’s opposition argues that the law on this point is uncertain. However, in making that argument, Plaintiff cites solely to a series of unpublished non-binding federal district court cases. These cases may show that there is a split of authority in the federal district courts as to whether meal and rest break premiums may support a derivative claim under Labor Code § 203. However, Ling, supra, 245 Cal.App.4th 1245 which is controlling and binding on this Court unequivocally held that such a claim “cannot support a section 203 penalty.”

Plaintiff also cites to a Ninth Circuit case that was certified to the California Supreme Court in an attempt to demonstrate that the law is unsettled. (Stewart v. San Luis Ambulance, Inc. (9th Cir. 2017) 878 F.3d 883.) Stewart cites to the California Supreme Court’s opinion in Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094 in which the Supreme Court held that extra hours paid for meal period violations constituted a “premium wage” not a penalty and the Supreme Court’s later opinion in Kirby, supra, 53 Cal.4th 1244 which as stated above held that a meal-period violation is not tied to nonpayment of wages. (Stewart, 878 F.3d at 887-888.) Stewart then indicates that courts have been inconsistent in rulings on this point but only cites to unpublished federal court decisions. Stewart, demonstrates that there is a dispute among the federal district courts though as already stated above, these unpublished decisions are not binding on this Court. Stewart does not mention Ling and does not point to any dispute among California state appellate courts. The Court also notes that in Kirby, the Supreme Court addressed its ruling in Murphy where it held that extra hours paid for meal period violations constituted a “premium wage” and not a penalty. In Kirby the Supreme Court noted that in Murphy it stated that the “additional hour of pay” remedy in Labor Code § 226.7 is a “liability created by statute” which liability is characterized as a wage not a penalty. Kirby stated that its holding that “a section 226.7 action is brought for the nonprovision of meal and rest periods, not for the ‘nonpayment of wages’” was not inconsistent with its holding in Murphy because “[t]o say that a section 226.7 remedy is a wage, however, is not to that the legal violation triggering the remedy is nonpayment of wages. As explained above, the legal violation is nonprovision of meal or rest breaks, and the object that follows the phrase ‘action brought for’ in section 218.5 is the alleged legal violation, not the desired remedy.” ( Kirby, supra, 53 Cal.4th at 1257.) Yet again, following Kirby, Ling, supra, 245 Cal. App.4th 1245, 1261 held that a claim for meal and rest period premiums “cannot support a section 203 penalty.” The Court does not perceive the law to be unsettled in California state courts.

The instant cause of action is defective as a matter of law.

Plaintiff did not request leave to amend and none is given as the Court fails to see any reasonable possibility that this cause of action could be amended. Indeed, Plaintiff does not even suggest that this cause of action could be based on anything other than the failure to provide meal and rest periods. The Court is guided by the principle that Plaintiff must show in what manner he can amend his complaint and how that amendment will change the legal effect of his pleading. [Citation.]’ [Citation.]” ( Goodman v. Kennedy (1976) 18 Cal.3d 335, 349. The Court perceives no reasonable possibility that the plaintiff can state a good cause of action. “[L]eave to amend should not be granted where . . . amendment would be futile.” (Vaillette v. Fireman’s Fund Ins. Co. (1993) 18 Cal.App.4th 680, 685; see generally Caliber Bodyworks, Inc. v. Superior Court (2005) 134 Cal.App.4th 365, 373-374. Indeed, leave to amend a defective complaint should be denied where no liability exists under substantive law. Rotolo v San Jose Sports & Entertainment, LLC (2007) 151 Cal.App.4th 307, 321.

Eleventh Cause of Action (Wage Statement Violations [Labor Code § 226].)

Defendant’s demurrer is sustained without leave to amend for failure to state facts sufficient to constitute a cause of action.

Plaintiff alleges that employee wage statements failed to include meal and rest period premiums that were owed but not paid. (SAC ¶ 86.) He also alleges that Defendants

failed to list the name and address of the legal entity that is the employer on wage statements as required by Labor Code § 226(a). (Id.) Plaintiff seeks penalties pursuant to Labor Code § 226.

Here, to the extent the cause of action is premised on meal and rest period premiums, it is deficient. A claim for inaccurate wage statements is derivative of the claim for the failure to provide meal and rest periods claim because, whenever meal and rest periods should have been paid, but were not paid, the wage statement is inaccurate. The claim is deficient for the reasons stated above in connection with the tenth cause of action.

To the extent that the eleventh cause of action is premised on the failure to include the name and address of the employer, it is deficient to the extent that it is asserted on behalf of the putative class, other than Plaintiff himself as it is barred by the statute of limitations. To that end Labor Code § 226 provides for a penalty against employers who fail to provide itemized Labor Code compliant wage statements. (Murphy, supra, 40 Cal.4th 1094, 1108-1109.) CCP § 340(a) provides a one year statute of limitations for an “action upon a statute for a penalty.” As seen from the SAC, Plaintiff was terminated on July 10, 2017. (SAC ¶ 22.) The SAC even concedes that a one year statute of limitations applies to the class wage statement claim. (SAC ¶ 13.) Defendant argues that this cause of action must have been filed no later than July 10, 2018.

As correctly argued by Defendant, the class wage statement claim does not relate back to the July 17, 2017 date the complaint was filed. Relation-back applies when the amended pleading: (1) rests on the same general set of facts; (2) involves the same injury; and (3) rests on the same instrumentality. (Norgart v. Upjohn Co. (1999) 21 Cal.4th 383, 408-409. “In determining whether the amended complaint alleges facts that are sufficiently similar to those alleged in the original complaint, the critical inquiry is whether the defendant had adequate notice of the claim based on the original pleading.” (Pointe San Diego Residential Community, L.P. v. Procopio, Cory, Hargreaves & Savitch, LLP (2011) 195 Cal.App.4th 265, 277.) A court must determine “whether the original complaint gave the defendant enough notice and scope of the plaintiff’s claim that [the defendant] shouldn’t have been surprised by the amplification of the allegations of the original complaint in the amended one.” (Id. at 279.)

Plaintiff’s original complaint only alleged causes of action for discrimination, retaliation, and a wage statement claim related to his employment only. Further the wage statement claim was only premised on Defendant’s alleged failure to include its address on Plaintiff’s wage statement. There were no class allegations in the original complaint and the SAC therefore cannot be said to relate back to the date of the original complaint. Plaintiff argues in opposition that he alleged the facts underlying the legal theory in this cause of action in his original complaint and first amended complaint and this claim in the SAC relates back because it is based on the same facts (lack of name and address in the wage statement) and the same injury and incident (deficient wage statement). Plaintiff cites to Grudt v. City of Los Angeles (1970) 2 Cal.3d 575.) That case does not assist Plaintiff. In that case the wife of a man killed in a police shooting sought to add the City of Los Angeles as a defendant on a respondeat superior theory and a claim that the City was negligent in retaining dangerous police officers. (Id. at 538-584.) The Court of Appeal found that the new claims related back to the original complaint because the new allegations were based on the shooting death and thus based on the same set of general facts in the

complaint. Plaintiff also cites Smeltzley v. Nicholson Mfg. Co. (1977) 18 Cal.3d 932 which found that in a case where the plaintiff’s leg was amputated as a result of operating a machine, an amended complaint adding the machine manufacturer did relate back, as it referred to the same accident and injuries referred to in the complaint which only named the plaintiff’s employer. By contrast here, in the SAC Plaintiff now seeks to add a claim for a statewide class of employees who were not referred to or named in the complaint, based on class theories that were not set forth in the complaint (e.g. meal and rest period violations and address deficiencies on behalf of the class). Again, the complaint contained no class allegations and only alleged that Defendant failed to include its address on his wage statement. Indeed, “an amended pleading that adds a new plaintiff will not relate back to the filing of the original complaint if the new party seeks to enforce an independent right or to impose greater liability against the defendants.” (San Diego Gas & Electric Co. v. Superior Court (2007) 146 Cal.App.4th 1545, 1550.) A claim regarding a new putative class of plaintiffs not identified in the complaint, regarding theories that were not set forth in the complaint, does not relate back to the complaint. This cannot be said to involve the same set of general facts. As a result, the eleventh cause of action, to the extent it is based on class claims, is barred by the one year statute of limitations in CCP § 340(a) as it was not filed within one year of the date Plaintiff was terminated.

The demurrer is sustained without leave to amend as to the class claim set forth in the eleventh cause of action. This ruling only applies to the class claims set forth in the eleventh cause of action. Plaintiff’s individual claim for a violation of Labor Code § 226 based on Defendant’s failure to include its name and address on the wage statement is not affected. This claim was set forth in the original complaint and is not affected by the analysis regarding meal and rest periods or the statute of limitations.

In short, the demurrer is sustained without leave to amend as to the tenth cause of action and the class claims in the eleventh cause of action.

The notice of demurrer does not provide notice of the Court’s tentative ruling system as required by Local Rule 1.06(D). Defendant’s counsel is ordered to notify Plaintiff’s counsel immediately of the tentative ruling system and to be available at the hearing, in person or by telephone, in the event Plaintiff’s counsel appears without following the procedures set forth in Local Rule 1.06(B).

This minute order is effective immediately. No formal order pursuant to CRC rule 3.1312 or other notice is required.

Item 14 2017-00222269-CU-WT

Thurston Bershell vs. Dignity Health Methodist Hospital

Nature of Proceeding: Motion to Strike

Filed By: McQueen, Daniel J.

Defendant Dignity Health’s motion to strike portions of Plaintiff Thurston Bershell’s second amended complaint (“SAC”) is ruled upon as follows.

This matter was continued from December 4, 2018 to allow Defendant to comply with CCP § 435.5. It has now done so.

Defendant moves to strike certain class allegations in Plaintiff’s complaint on the basis that the proposed class period is improper because the class claims do not relate back to the filing date of the original Complaint. The Court notes that the demurrer attacks only the tenth and eleventh causes of action. The SAC asserts other causes of action on behalf of the class (e.g., eighth and ninth) which were not challenged on demurrer.

As set forth in the Court’s ruling on the demurrer, the SAC does not relate back to the filing of the original complaint again because neither the complaint nor the FAC contained any class actions. Thus, the currently phrased class definition which is linked to the date the original complaint was filed and extends back four years is improper. Rather the class definition must be linked to the date the SAC was filed (September 18, 2018.)

Plaintiff’s opposition argues that his proposed class period is proper and that Defendant’s request is too broad and the proper scope of the class should be determined by way of a motion for class certification. Plaintiff argues that Defendant only seeks to clarify the beginning date of the class periods in the class definitions and he should be allowed to amend the SAC to clarify the beginning date of the class period. In reply, Defendant states that it does not contest Plaintiff’s argument that he should be allowed to amend to add the proper date for the proposed class period and that this is exactly the point of the motion. Given the fact that it is clear that the SAC does not relate back to the complaint, the allegations in the class definition that key the class definition to “four (4) years prior to the filing of this Action until the date this class is certified” is improper and thus is the proper subject of a motion to strike under CCP

§ 436(a)-(b). Plaintiff provides no authority that this issue must wait until a class certification motion. The motion to strike the overbroad class period is granted. The motion is granted with leave to amend to allow Plaintiff to insert the proper date for the class period (September 18, 2018). It appears that the parties have agreed to this amendment as a result of the Court ordered meet and confer process.

Defendant’s motion to strike Plaintiff’s request for “[a]ttorney’s fees and costs and interest pursuant to California Code of Civil Procedure section 1021.5” is denied. Citing to Kirby v. Immoos Fire Protection. Inc. (2012) 53 Cal.4th 1244, Defendant argues that attorneys’ fees cannot be recovered on a meal and rest period claim.

However, that argument is incomplete. Rather Kirby held that “neither section 1194 nor section 218.5 [of the Labor Code] authorizes an award of attorney’s fees to a party that prevails on a section 226.7 claim. (Id., at 1248.) Kirby only addressed whether fees were available under the specific Labor Code statutes and said nothing with respect to whether fees would be available under CCP § 1021.5 the statute pursuant to which Plaintiffs seek fees in connection with the Labor Code meal and rest period claims. Plaintiff cites to non-binding unpublished federal district court opinions indicating that fees may be available under CCP § 1021.5 in connection with meal and rest period claims. The Court need not rest its decision on those non-binding cases.

A “prevailing plaintiff may seek attorney fees as a private attorney general under Code of Civil Procedure section 1021.5.” (Zhang v. Superior Court (2013) 57 Cal.4th 364, 371, fn.4.) Regardless of the merits of Plaintiff’s claims, the Court declines to strike the request for fees pursuant to CCP § 1021.5. CCP § 1021.5, which provides for an award of fees under the private attorney general doctrine states that fees may be awarded upon motion “to a successful party against one or more opposing parties in any action which has resulted in the enforcement of an important public right affecting

the public interest.” (CCP § 1021.5.) While Defendant’s reply brief argues that Plaintiff’s claims will not meet CCP § 1021.5’s standards, whether or not a particular action has resulted in the enforcement of an important public right is not properly determined until the litigation has concluded. The Court will not make that determination on the motion to strike.

Further, while not raised by either party, the Court would note that there is no requirement that a request for attorneys’ fee under CCP § 1021.5 be plead with any specificity much less be pled at all. “There is no requirement that the intent to seek attorney fees under section 1021.5 must be pleaded in the underlying action…Such fees are not part of the underlying cause of action, but are incidents to the cause and are properly awarded after entry of a…judgment…” (Snatchko v. Westfield, LLC (2010) 187 Cal.App.4th 469, 497 [citations omitted] [emphasis in original].) Thus it is error for a trial court to strike a prayer for attorney fees based on a failure to adequately plead their basis. (Id.) Granting Defendant’s motion would be erroneous.

As a result, the motion to strike is granted with leave to amend as to Plaintiff’s class definition allegations. Plaintiff is given leave to amend to insert the proper date for the class period (September 18, 2018). The motion to strike is denied as to the request for fees pursuant to CCP § 1021.5.

Where leave was given, Plaintiff may file and serve an amended complaint no later than January 24, 2019. Defendant shall file and serve its response within 30 days thereafter, 35 days if the amended complaint is served by mail as modified by the CCP § 430.41 extension as necessary.

The notice of motion does not provide notice of the Court’s tentative ruling system as required by Local Rule 1.06(D). Defendant’s counsel is ordered to notify Plaintiff’s counsel immediately of the tentative ruling system and to be available at the hearing, in person or by telephone, in the event Plaintiff’s counsel appears without following the procedures set forth in Local Rule 1.06(B).

The minute order is effective immediately. No formal order pursuant to CRC rule 3.1312 or other notice is required.