Justia California Court of Appeals Opinion Summaries

Isabel Garibay appealed a trial court's confirmation of a class action settlement reached between Josue Uribe and Crown Building Maintenance Company (Crown). Uribe sued Crown as an individual regarding alleged Labor Code violations for failure to reimburse him for the cost of uniform cleaning and required footwear as a day porter doing janitorial-type work. Uribe’s suit also included a cause of action in a representative capacity for civil penalties and injunctive relief under the Labor Code Private Attorneys General Act of 2004 (PAGA). The parties reached a settlement conditioned on Uribe filing an amended complaint converting his lawsuit into a class action on his Labor Code claims and including unreimbursed employee cell phone usage costs as an additional basis for both his Labor Code and PAGA causes of action. Garibay, an unnamed member of the class once it was formed, had earlier filed in the Alameda County Superior Court a putative class action asserting Labor Code claims for unreimbursed cell phone use by Crown employees, together with a representative PAGA cause of action on that basis. When Uribe and Crown sought preliminary approval of their agreement to settle Uribe’s lawsuit on a class-wide basis, the trial court authorized Garibay to intervene as a named party in the lawsuit to oppose the settlement. The trial court later granted Uribe’s motion for preliminary approval of the settlement, and then Crown and Uribe’s joint motion for final approval. Meanwhile, the Judicial Council had referred Crown’s petition to coordinate Uribe’s and Garibay’s lawsuits to the presiding judge of the Alameda court to appoint a judge to hear the petition; that appointment remained pending at the time the judgment in Orange County was entered. After the parties advised the Alameda court no stay had been entered in the coordination proceedings, the court subsequently entered judgment. Garibay challenged the settlement after the trial court declined to rule on both Crown’s motion to dismiss Garibay’s complaint in intervention and Garibay’s motion to vacate the judgment. The Court of Appeal found Uribe's PAGA notice did not encompass a claim for unreimbursed cell phone expenses, making the notice was inadequate to support Uribe’s PAGA cause of action on that theory in his lawsuit. And because Uribe and Crown’s agreement did not allow for severance of nonviable settlement terms, judicial approval of a settlement that included Uribe’s PAGA cause of action could not survive review. The Court therefore reversed the judgment. View "Uribe v. Crown Building Maintenance Co." on Justia Law

Lacy filed a retaliation complaint against her former employer, Crestwood Behavioral Health, with the California Labor Commissioner, under Labor Code section 98.7(a). After the Commissioner notified Crestwood of its investigation of Lacy’s complaint, Crestwood filed a petition to compel arbitration against Lacy but did not include the Commissioner as a party. In granting the petition, the trial court compelled Lacy to arbitrate her retaliation complaint and stayed the Commissioner’s investigation pending the completion of that arbitration. Approximately 100 days after Crestwood alerted her to the trial court’s ruling, the Labor Commissioner moved to intervene so she could vacate the order. The trial court denied the motion to intervene as untimely and because the order staying the Commissioner’s investigation did not impair or impede her ability to protect her interest in Lacy’s retaliation complaint.The court of appeal reversed. The motion to intervene was timely; neither party was prejudiced by the delay. The arbitration order prevents the Commissioner from exercising this authority indefinitely; it necessarily impairs the ability of the Commissioner to protect the public interest “in protecting the rights of individual employees and job applicants who could not otherwise afford to protect themselves.” View "Crestwood Behavioral Health v. Lacy" on Justia Law

Defendant RGIS, LLC (RGIS) appealed a trial court’s order denying its petition to compel arbitration of representative claims under the Private Attorney General Act of 2004 (PAGA). In denying the petition, the trial court followed the California Supreme Court’s decision in Iskanian v. CLS Transportation Los Angeles, LLC, 59 Cal.4th 348 (2014), which held that individual employees cannot contractually waive their right to bring a representative action under the PAGA, and this state law rule was not preempted by the Federal Arbitration Act (FAA). RGIS argued that the Supreme Court’s holding in Iskanian was subsequently abrogated by the United States Supreme Court’s decision in Epic Systems Corporation v. Lewis, __ U.S. __ [138 S.Ct. 1612] (2018). The Court of Appeal found, however, that Epic Systems did not consider the same issue concerning the nonwaivable nature of PAGA claims decided by Iskanian. Accordingly, and along with every published appellate decision that has decided this issue, the Court rejected the argument and followed Iskanian. Although it agreed with the multitude of reported cases addressing this issue, the Court published this opinion because this was an issue of first impression for this district. View "Williams v. RGIS, LLC" on Justia Law

Morales accepted a full-time position at Factor, a flooring store, in 2016. His duties included cleaning the warehouse, accepting shipments, making deliveries to job site locations, picking up tile from distributors, and assisting customers in the selection of tile. Morales’s regular hours were Monday through Friday from 8:00 a.m. to 6:00 p.m. and Saturdays from 9:00 a.m. to 5:00 p.m. Beginning March 9, 2018, Morales no longer worked every Saturday. After asking Factor to be compensated for overtime hours, Morales was terminated.Morales sued, seeking unpaid overtime wages, meal and rest break compensation, statutory penalties for inaccurate wage statements, and alleging retaliation and wrongful termination in violation of public policy. The trial court entered a $99,394.16 judgment in favor of Morales, which included $42,792.00 in unpaid overtime wages. The court of appeal affirmed, rejecting an argument that the trial court erred in calculating Morales’s regular rate of pay for purposes of determining the amounts owed to Morales for unpaid overtime. The court calculated Morales’s regular rate of pay by dividing his weekly paychecks by 40, the number of non-overtime hours Morales worked per week. If the employer has failed to keep records required by statute, the consequences for such failure should fall on the employer. View "Morales v. Factor Surfaces LLC" on Justia Law

Janitors worked for VPM providing janitorial services at a residential complex (the Site). VPM and the Union executed an agreement, providing that, if VPM terminated its janitorial contract with the Site, VPM would offer a severance package to employees who executed an agreement stating they were voluntarily resigning and releasing all claims against VPM. The Termination Agreement stated: “[N]either the Union nor any bargaining unit employee waives any rights under the Displaced Janitors Opportunity Act to require any successor employer to offer employment to existing employees ” VPM terminated its janitorial contract with the Site. Janitors signed Separation Agreements stating the employee was voluntarily resigning, providing lump-sum payments, and releasing all claims against VPM. Days later, Successor began providing janitorial services at the Site; Janitors appeared at the Site and asserted their right to retention. Successor did not retain any of the Janitors.Plaintiffs sued Successor under the Displaced Janitor Opportunity Act (Lab. Code 1060–1065; DJOA), and the Displaced Worker Protection Act. The court of appeal affirmed an award of summary judgment and attorney fees in favor of the Union and Janitors. The court rejected arguments concerning the “voluntary resignations” and that VPM stopped providing services a few days before the nominal end of the contract and, therefore, had no employees “at the time of contract termination.” View "SEIU-USWW v. Preferred Building Services, Inc." on Justia Law

Plaintiff-appellant Jenaro Carrasco worked as a parole agent for real party in interest Department of Corrections and Rehabilitation (department) for five years. He was promoted to the position of special agent and was subject to a 12-month probationary period. The department served Carrasco with a notice of rejection before the end of the probationary period and stated six reasons for the rejection. Carrasco challenged his rejection before defendant-respondent the State Personnel Board (the board) and, when the board upheld his rejection, he petitioned the superior court for a writ of administrative mandamus. At the conclusion of the administrative and superior court proceedings, only two of the reasons given for Carrasco’s rejection were found to have been supported by substantial evidence. However, both the board and the superior court concluded Government Code section 19175 did not mandate reinstatement if less than all the reasons given for the rejection were upheld. In addition, the board and the superior court concluded the department had not acted in bad faith when it rejected Carrasco. Therefore, the superior court denied Carrasco’s petition. After review, the Court of Appeal concurred with the board and superior court, and affirmed the superior court's judgment. View "Carrasco v. State Personnel Bd." on Justia Law

Three drivers for the rideshare company, Lyft, each filed separate representative actions against Lyft under the Private Attorneys General Act of 2004 (PAGA) (Lab. Code 2698), alleging that Lyft misclassified its California drivers as independent contractors rather than employees, thereby violating multiple provisions of the Labor Code. Following mediation in 2019, one driver, Turrieta, and Lyft reached a settlement. After Turrieta moved for court approval of the settlement, the other drivers sought to intervene and object to the settlement, arguing that Lyft had engaged in a “reverse auction” by settling with Turrieta for an unreasonably low amount and that the settlement contained other provisions that were unlawful and inconsistent with PAGA’s purpose. The trial court found that they lacked standing and approved the settlement.The court of appeal affirmed. The status of the other drivers as PAGA plaintiffs in separate actions does not confer standing to move to vacate the judgment or challenge the judgment on appeal. While they may appeal from the court’s implicit order denying them intervention, there was no error in that denial. View "Turrieta v. Lyft, Inc." on Justia Law

In 2004-2010, all the carriers signed a contract with The Fresno Bee to provide newspaper home delivery services, titled, “Independent Contractor Home Delivery Distribution Agreement.” In a class action alleging violation of the unfair competition law (UCL) (Bus. & Prof. Code 17200), the trial court determined the carriers were independent contractors and entered judgment in favor of The Bee.The court of appeal reversed. Whether the carriers are employees or independent contractors must be determined under the Borello test; the trial court erred in deferring to the Employment Development Department regulations, which are inapplicable. The trial court failed to properly analyze the factors required by Borello. There were disputed issues of fact concerning the newspaper’s right to control necessary operations, as well as secondary factors. The court declined to resolve whether the carriers are employees or independent contractors, and instead remanded for the trial court to address the issue. View "Becerra v. McClatchy Co." on Justia Law

Plaintiff Irean Amaro filed this wage and hour class action and Private Attorneys General Act (PAGA) lawsuit against defendant Anaheim Arena Management (AAM) in 2017. At the time, there were already two existing class actions asserting the same claims: one in 2014, and the other in 2016. About a month after filing her lawsuit, Amaro and AAM reached a global settlement that covered the claims asserted in the two prior class actions. The plaintiffs from the prior actions, which included intervener Rhiannon Aller, were not involved in those settlement discussions. Aller intervened in this lawsuit and objected to the settlement. Initially, the trial court denied preliminary approval of the settlement on grounds Amaro had not given the court enough information to determine the adequacy of the settlement. Amaro then engaged in extensive informal discovery and entered into an amended settlement with AAM. The court approved the amended settlement over Aller’s objections and entered judgment per the settlement’s terms. Aller appealed, claiming the court’s approval of the settlement was erroneous for two reasons: (1) the class members’ release in the settlement was improper because it extended to claims outside the scope of Amaro’s complaint, waived class members’ (from all class actions) claims under the Fair Labor Standards Act (FLSA) without obtaining their written consent, and released PAGA claims beyond the limitations period of Amaro’s own PAGA claim; and (2) the court abused its discretion in finding the settlement was not the product of a collusive reverse auction. The Court of Appeal agreed the release was overbroad, but there was nothing inherently wrong with AAM's bypassing the other class action plaintiffs and undercutting their claims by negotiating a settlement with Amaro that extinguished the other suits. Though the Court rejected most of Aller’s arguments, it reversed the judgment and remanded with directions due to the overbreadth of the release. View "Amaro v. Anaheim Arena Management" on Justia Law

The Department filed suit against M&N, alleging numerous causes of action stemming from defendants' operation of a business that purchased retail installment sales contracts from used car dealerships where defendants used a formula that considered the gender of the car purchaser in deciding how much to pay for the contracts. The trial court entered judgment in favor of the Department on the first and second causes of action, which alleged violations of the Unruh Civil Rights Act (Civ. Code, 51) and Civil Code section 51.5, and assessed over $6 million in statutory damages pursuant to Civil Code section 52, subdivision (a). The trial court dismissed the fifth, sixth, and seventh causes of action, which alleged violations of Government Code section 12940, subdivisions (i) and (k) of the Fair Employment and Housing Act (FEHA).In the published portion of the opinion, the Court of Appeal held that the trial court erred in dismissing the fifth cause of action and otherwise affirmed the trial court's judgment. In the fifth cause of action, the Department alleged that M&N "knowingly compelled and coerced its employees to engage in practices that violated" FEHA and Civil Code sections 51 and 51.5, in violation of section 12940, subdivision (i). The court held that employees who are coerced by their employer to violate Civil Code sections 51 and 51.5 are "aggrieved" within the meaning of section 12965, subdivision (a) and have standing to sue their employer pursuant to section 12940, subdivision (i). Therefore, the employees of M&N who were coerced by M&N into violating Civil Code sections 51 and 51.5 could be individually liable for sex discrimination. The court explained that these employees would necessarily be "aggrieved" by their employer's unlawful employment practice as their personal interests would be affected by their employer's misconduct. Therefore, the Department was authorized to file a civil action on behalf of these employees and the trial court erred by dismissing the fifth cause of action. View "Department of Fair Employment and Housing v. M&N Financing Corp." on Justia Law