Dept. CX102 Civil
Civil Complex Center
Tentative Rulings
Department CX102
Judge Peter Wilson
(657-622-5302)
October 6, 2022
These are the Court’s tentative rulings. They may become orders if the parties do not appear at the hearing. The Court also might make a different order at the hearing. (Lewis v. Fletcher Jones Motor Cars, Inc. (2012) 205 Cal.App.4th 436, 442, fn. 1.)
If the parties agree to submit on the Court’s tentative ruling, please call the Court Clerk to inform the Court that all parties submit on the Court’s tentative ruling.
Appearances, whether remote or in person, must be in compliance with Code of Civil Procedure §367.75, Rule 3.672 of the California Rules of Court, and Superior Court of California, County of Orange, Appearance Procedure and Information, Civil Unlimited and Complex.
Information, instructions and procedures to appear remotely are also available here.
Unless the court orders otherwise, remote appearances will be conducted via Zoom through the court’s online check-in process. Once online check-in is completed, counsel and self-represented parties will be prompted to join the courtroom’s Zoom hearing session. Participants will initially be directed to a virtual waiting room while the clerk provides access to the video hearing.
The public may attend hearings by coming to court or via remote access as described above.
Parties preferring to be heard in person, instead of remotely, should provide notice of their intent to appear in person to the court and to all other parties at least five days before the hearing.
Requests for fee waivers may be submitted to CivilSRL@occourts.org or the drop box outside the Central Justice Center courthouse.
COURT REPORTERS: Official court reporters (i.e. court reporters employed by the Court) are NOT typically provided for law and motion matters in this department. If a party desires a record of a law and motion proceeding, it will be the party’s responsibility to provide a court reporter. Parties must comply with the Court’s policy on the use of privately retained court reporters which can be found at:
·Civil Court Reporter Pooling; and
·For additional information, please see the court’s website at Court Reporter Interpreter Services for additional information regarding the availability of court reporters.
Note: Procedural Guidelines for Class Action and PAGA Settlement appear after the Tentative Rulings.
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Case Name |
Tentative Ruling |
1. |
Gutierrez vs. Adecco USA, Inc. 2020-01123754 |
Defendant Adecco USA, Inc. (Adecco) seeks to compel Plaintiff Gilberto Gutierrez to binding arbitration of his individual PAGA claim and to dismiss this action, including the representative PAGA claim, without prejudice pursuant to Viking River Cruises, Inc. v. Moriana (2022) 142 S. Ct. 1906 (Viking River Cruises). Defendants Blue Diamond Growers, Blue Diamond Growers Service, and Blue Diamond Almond Growers (collectively, Blue Diamond Defendants) join Adecco’s Motion on the ground they are a third-party beneficiary of the arbitration agreement between Adecco and Plaintiff. For the reasons set forth below, the Motion to Compel Arbitration is GRANTED. The motion to dismiss is DENIED. The Court DENIES Plaintiff’s request for judicial notice (ROA 157) as Plaintiff failed to attach any of the orders for which he sought judicial notice. There Is a Valid Arbitration Agreement. To compel arbitration under either the CAA or FAA, there must be a valid arbitration agreement between the parties. (Code Civ. Proc., § 1281.2; Chiron Corp. v. Ortho Diagnostic Sys., Inc. (9th Cir. 2000) 207 F.3d 1126, 1130.) Moving party bears the burden of proving the existence of an arbitration agreement by a preponderance of the evidence. (Rosenthal v. Great Western Fin. Securities Corp. (1996) 14 Cal.4th 394, 413; Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 972.) It is undisputed that Plaintiff electronically signed and entered into the “Voluntary Dispute Resolution and Arbitration Agreement for Consultants/Associates” (Arbitration Agreement) between him and Adecco. See ROA 131, Prentiss Decl., ¶¶4-18 and Exs. A and B. It is also undisputed that the Blue Diamond Defendants are third-party beneficiaries of the Arbitration Agreement. See ROA 131, Prentiss Decl., Ex. B, ¶10; ROA 142, Watkins Decl., ¶¶1-2, 4; ROA 2, Complaint, ¶¶2, 6. Further, it is undisputed that the FAA applies to the Arbitration Agreement. See ROA 131, Prentis Decl., ¶1 and Ex. B, §1; ROA 142, Watkins Decl., ¶¶3-4. Plaintiff Has Not Met His Burden of Establishing Any Defense to Arbitration. The party opposing arbitration bears the burden of proving, by a preponderance of the evidence, any fact necessary to its defense. (Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 903, 971.) Plaintiff argues the Arbitration Agreement is procedurally and substantively unconscionable.
California law applies to the unconscionability analysis. (Nielsen Contracting, Inc. v. Applied Underwriters, Inc. (2018) 22 Cal.App.5th 1096, 1107 [“[U]nder the FAA’s savings clause, an arbitration agreement is not enforceable if a party establishes a state law contract defense, such as fraud, duress, unconscionability, or illegality.”]; see also AT&T Mobility LLC v. Concepcion (2011) 563 U.S. 333, 339 [The FAA’s “saving clause permits agreements to arbitrate to be invalidated by ‘generally applicable contract defenses, such as fraud, duress, or unconscionability ….’”].) Unconscionability has a procedural and a substantive component, requiring both to be present though not in the same degree. (Serafin v. Balco Properties Ltd., LLC (2015) 235 Cal.App.4th 165, 177.) “A sliding scale is applied so that ‘the more substantively oppressive the contract term, the less evidence of procedural unconscionability is required to come to the conclusion that the term is unenforceable, and vice versa.’ ” (Id. at 178.) Plaintiff Has Not Demonstrated Any Procedural Unconscionability. In OTO, L.L.C. v. Kho (2019) 8 Cal.5th 111, the California Supreme Court explained that the procedural unconscionability analysis begins with an inquiry into whether the contract is one of adhesion. (Id. at 126.) “An adhesive contract is standardized, generally on a preprinted form, and offered by the party with superior bargaining power on a take-it-or-leave-it basis. (Baltazar v. Forever 21, Inc. (2016) 62 Cal.4th 1237, 1245.) Arbitration contracts imposed as a condition of employment are typically adhesive (Armendariz v. Foundational Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 114-115; Serpa v. California Surety Investigations, Inc. (2013) 215 Cal.App.4th 695, 704.) But the fact that an agreement is adhesive is not, alone, sufficient to render it unconscionable. (Malone v. Superior Court (2014) 226 Cal.App.4th 1551, 1561.) The court also considers whether circumstances of the contract’s formation created such oppression or surprise that closer scrutiny of its overall fairness is required. (OTO, L.L.C., supra, 8 Cal.5th at 126-127.) “The circumstances relevant to establishing oppression include, but are not limited to (1) the amount of time the party is given to consider the proposed contract; (2) the amount and type of pressure exerted on the party to sign the proposed contract; (3) the length of the proposed contract and the length and complexity of the challenged provision; (4) the education and experience of the party; and (5) whether the party's review of the proposed contract was aided by an attorney.” (Id.) Plaintiff argues there is procedural unconscionability because he was required to fill out 44 onboarding documents without supervision or assistance, without sufficient time or consideration, and was forced to accept the Arbitration Agreement on a take-it-or-leave-it basis in order to complete his onboarding paperwork and begin working. ROA 161, Omnibus Opp., pp. 10-11. Contrary to Plaintiff’s characterization, the Arbitration Agreement was not presented on a take-it-or-leave-it-basis. The Arbitration Agreement contains an opt out clause that permitted Plaintiff 30 days to opt out. ROA 131, Prentiss Decl., Ex. B, ¶9. Additionally, the Arbitration Agreement states that Plaintiff has the right to consult with an attorney and has read the Arbitration Agreement “carefully” and “fully understands the meaning of its terms and is signing it knowingly and voluntarily.” ROA 161, Prentiss Decl., Ex. B, ¶11. Importantly, Plaintiff has not submitted any evidence, including his own declaration, attesting to any surprise, that he was not given sufficient instructions or time to review the materials, that he was misled, or that he was pressured in any way to sign the Arbitration Agreement and not opt out. The Arbitration Agreement is not hidden in some other document, but is a separate, stand-alone document that clearly states at the top of the first page in bold letters it is a “Voluntary Dispute Resolution and Arbitration Agreement”. ROA 161, Prentiss Decl., Ex. B, p. 1. Plaintiff Has Not Demonstrated Substantive Unconscionability. Substantive unconscionability occurs when a contract, particularly, contracts of adhesion, impose terms “that have been variously described as overly harsh, unduly oppressive, so one-sided as to shock the conscience, or unfairly one-sided. All of these formulations point to the central idea that the unconscionability doctrine is concerned not with a simple old-fashioned bad bargain, but with terms that are unreasonably favorable to the more powerful party. Unconscionable terms impair the integrity of the bargaining process or otherwise contravene the public interest or public policy or attempt to impermissibly alter fundamental legal duties.” (OTO, L.L.C. v. Kho, supra, 8 Cal. 5th at 129–30, internal quotations and citations omitted.) A contract term is not substantively unconscionable when it merely gives one side a greater benefit; rather, the term must be so one-sided as to shock the conscience. (Lane v. Francis Capital Management LLC (2014) 224 Cal.App.4th 676, 692, citing inter alia, 24 Hour Fitness, Inc. v. Superior Court (1998) 66 Cal.App.4th 1199, 1213.) Such unconscionability turns not only on a one-sided result, but also on an absence of justification for it. (Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal. 4th 83, 117-118.) Plaintiff argues the Arbitration Agreement is substantively unconscionable because it fails to comply with any of the requirements set forth in Armendariz v. Foundation Health Psychcare Services, Inc. Those elements of essential fairness are (1) a neutral arbitrator; (2) adequate discovery; (3) all types of relief otherwise available in court; (4) a written arbitration award that permits limited judicial review; and (5) limits on arbitration costs and fees (in arbitration of FEHA claims, employer must pay all costs unique to arbitration). (24 Cal. 4th at 102, 118; Pearson Dental Supplies, Inc. v. Sup.Ct. (Turcios) (2010) 48 Cal. 4th 665, 677; see also Craig v. Brown & Root, Inc. (2000) 84 Cal. App. 4th 416, 422 [$50 arbitration cost to employee acceptable].) Plaintiff contends that because the Arbitration Agreement incorporates by reference the AAA Employment Rules to govern arbitration but does not attach them, and does not otherwise discuss the Armendariz requirements, it is substantively unconscionable. ROA 161, Omnibus Opp., pp. 11-12. Plaintiff’s argument is not persuasive. The Arbitration Agreement expressly provides that the AAA Employment Rules will govern and provides link to obtain those rules as well as instructions that the AAA Employment Rules may be obtained from HR. ROA 131, Prentiss Decl., Ex. B, ¶1. Referencing the AAA rules without attaching them is acceptable and does not render the agreement procedurally unconscionable since the AAA Rules are available on the internet. (See Lane v. Francis Capital Management LLC (2014) 224 Cal.App.4th 676, 691-692 [failure to attach a copy of the AAA rules “did not render the agreement procedurally unconscionable” because they “were available on the Internet”].) Further, the California Supreme Court explained in Baltazar v. Forever 21, Inc. (2016) 62 Cal.4th 1237 that the failure to provide the AAA rules generally raises procedural unconscionability concerns only if there is substantively unconscionable provision in the AAA rules. (Id. at 1236; Cisneros Alvarez v. Altamed Health Services Corporation (2021) 60 Cal.App.5th 572, 590.) Plaintiff does not argue that any specific AAA Employment Rule is unconscionable. It appears that Plaintiff does not dispute that the AAA Employment Rules satisfy the Armendariz requirements since he notes that the AAA Employment Rules “outline the Armendariz minimum requirements” and does not identify any specific provisions that violate the Armendariz requirements or otherwise take issue with any specific provision. ROA 161, Omnibus Opp., p. 12:17-18. Plaintiff Must Arbitrate His Individual PAGA Claim. Pursuant Viking River, “the FAA preempts the rule of Iskanian insofar as it precludes division of PAGA actions into individual and non-individual claims through an agreement to arbitrate.” (142 S.Ct. at 1925.) Thus, a plaintiff may be compelled to arbitrate his or her individual PAGA claim even if the arbitration agreement has a wholesale PAGA waiver as long as there is a severability clause. (Id.) This is the situation here. See ROA 131, Prentiss Decl., Ex. B, ¶8 [“BY SIGNING THIS AGREEMENT, THE PARTIES AGREE THAT EACH MAY BRING CLAIMS AGAINST THE OTHER ONLY IN THEIR INDIVIDUAL CAPACITIES AND NOT IN ANY REPRESENTATIVE PROCEEDING UNDER ANY PRIVATE ATTORNEY GENERAL STATUTE (“PAGA CLAIM”), UNLESS APPLICABLE LAW REQUIRES OTHERWISE. (Bold and capitalization in original.)”] and ¶13 [severability clause]. Based on the foregoing reasons, the Motion and Joinder are GRANTED. Plaintiff is ordered to binding arbitration of his individual PAGA claim with Defendants. The Representative PAGA Claim Should Be Stayed. In Viking River, the majority of the U.S. Supreme Court explained that under its view of California law, plaintiffs who are ordered to arbitrate their individual PAGA claims lose standing to prosecute representative PAGA claims: “But as we see it, PAGA provides no mechanism to enable a court to adjudicate non-individual PAGA claims once an individual claim has been committed to a separate proceeding. Under PAGA’s standing requirement, a plaintiff can maintain non-individual PAGA claims in an action only by virtue of also maintaining an individual claim in that action.” (142 S. Ct. at 1925.) But, as Plaintiff correctly points out, “construction of a state statute by a federal court does not preclude a state court from later rejecting the federal court’s conclusion.” (16 Cal.Jur.3d (2022) Courts, § 324. See also, East Quincy Services Dist. v. General Accident Ins. Co. of America (2001) 88 Cal.App.4th 239, 246 (“As we repeatedly remind litigants, on questions of state law even U.S. Supreme Court decisions are not controlling.”).) As two concurrences in Viking River pointed out, the majority may well be incorrect about PAGA standing. Justice Sotomayor wrote, “Of course, if this Court’s understanding of state law is wrong, California courts, in an appropriate case, will have the last word.” (Viking River, supra, 142 S.Ct. at 1926 [conc. opn. of Sotomayor, J.].) And three justices noted the majority’s conclusion “addresses disputed state-law questions” and “is unnecessary to the result.” (Ibid. [conc. opn. of Barrett, J.].) The California Supreme Court recently granted review in Adolph v. Uber Technologies, S274671, to answer this exact question. Per an order dated August 1, 2022, “The issue to be briefed and argued is limited to the following: Whether an aggrieved employee who has been compelled to arbitrate claims under the Private Attorneys General Act (PAGA) that are ‘premised on Labor Code violations actually sustained by’ the aggrieved employee [citation] maintains statutory standing to pursue ‘PAGA claims arising out of events involving other employees’ [citation] in court or in any other forum the parties agree is suitable.” Were the Court to dismiss the representative PAGA claims only for Adolph to reach a different conclusion than Viking River, both judicial economy and the parties’ resources would be taxed by attempts to unwind the dismissal. The Court accordingly DENIES the request to dismiss the representative claims without prejudice to Defendants raising the issue again when the arbitration on Plaintiff’s individual claims concludes. The Court orders that this matter is STAYED pending completion of the arbitration. (Code Civ. Proc. § 1281.4.) A status conference is scheduled for April 7, 2023 at 9:00 a.m., and the parties are ordered to file a joint status report not later than March 30, 2023. Defendant Adecco is ordered to give notice. |
2.
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Itkoff vs. ABC Phones of North Carolina 2017-00947398 |
Defendant ABC Phones of North Carolina, Inc. dba A Wireless seeks to compel Plaintiff Dylan Itkoff to arbitrate his individual PAGA claim, dismiss the representative PAGA claims and stay this action pending arbitration. The Motion to Compel Arbitration is GRANTED. Plaintiff concedes he is required to arbitrate his individual PAGA claims. ROA 184, Opp., pp. 2:19-20 [“Plaintiff concedes that Viking River Cruises requires arbitration of Plaintiff’s individual PAGA claims”], 5:1-2 [“Accordingly, Plaintiff concedes compelling arbitration of her (sic) individual claims”], 14:9-12 [For the foregoing reasons, and because the matter was already settled in writing, Defendant’s motion to compel arbitration of Plaintiff’s individual PAGA claims should be granted, but their motion to dismiss Plaintiff’s representative action under PAGA on behalf of the state and similarly aggrieved employees should be denied”]. Therefore, the parties are ordered to arbitrate Plaintiff’s individual PAGA claims. Under the FAA, 9 U.S.C. §3, and CAA, CCP §1281.4, this case must be STAYED until completion of Plaintiff’s arbitration. In Viking River, the majority of the U.S. Supreme Court explained that under its view of California law, plaintiffs who are ordered to arbitrate their individual PAGA claims lose standing to prosecute representative PAGA claims: “But as we see it, PAGA provides no mechanism to enable a court to adjudicate non-individual PAGA claims once an individual claim has been committed to a separate proceeding. Under PAGA’s standing requirement, a plaintiff can maintain non-individual PAGA claims in an action only by virtue of also maintaining an individual claim in that action.” (142 S. Ct. at 1925.) But “construction of a state statute by a federal court does not preclude a state court from later rejecting the federal court’s conclusion.” (16 Cal.Jur.3d (2022) Courts, § 324. See also, East Quincy Services Dist. v. General Accident Ins. Co. of America (2001) 88 Cal.App.4th 239, 246 (“As we repeatedly remind litigants, on questions of state law even U.S. Supreme Court decisions are not controlling.”).) As two concurrences in Viking River pointed out, the majority may well be incorrect about PAGA standing. Justice Sotomayor wrote, “Of course, if this Court’s understanding of state law is wrong, California courts, in an appropriate case, will have the last word.” (Viking River, supra, 142 S.Ct. at 1926 [conc. opn. of Sotomayor, J.].) And three justices noted the majority’s conclusion “addresses disputed state-law questions” and “is unnecessary to the result.” (Ibid. [conc. opn. of Barrett, J.].) The California Supreme Court recently granted review in Adolph v. Uber Technologies, S274671, to answer this exact question. Per an order dated August 1, 2022, “The issue to be briefed and argued is limited to the following: Whether an aggrieved employee who has been compelled to arbitrate claims under the Private Attorneys General Act (PAGA) that are ‘premised on Labor Code violations actually sustained by’ the aggrieved employee [citation] maintains statutory standing to pursue ‘PAGA claims arising out of events involving other employees’ [citation] in court or in any other forum the parties agree is suitable.” Were the Court to dismiss the representative PAGA claims only for Adolph to reach a different conclusion than Viking River, both judicial economy and the parties’ resources would be taxed by attempts to unwind the dismissal. The Court accordingly DENIES the request to dismiss the representative claims without prejudice to Defendant raising the issue again when the arbitration on Plaintiff’s individual PAGA claims concludes. The Court orders that this matter is STAYED pending completion of the arbitration. (Code Civ. Proc. § 1281.4.) The Court SUSTAINS Defendant’s objections (ROA 190) to the Singer Decl. and Ex. A attached thereto. A status conference is scheduled for April 7, 2023 at 9:00 a.m., and the parties are ordered to file a joint status report not later than March 30, 2023. Defendant is ordered to give notice. |
3. |
Loera vs. Hirsch Pipe & Supply Co., Inc. 2020-01136571 |
The Verified Application for Non-Resident Attorney Taylor Jones to appear pro hac vice for Plaintiff is GRANTED. Moving counsel’s Application satisfies the requirements of CRC Rule 9.40. Moving counsel is also ordered to give notice, including to the State Bar of California, and file proof of service within 5 days. |
4. |
Puglisi vs. Storm Water Inspection & Maintenance Services, Inc. 2020-01175159 |
Having considered the papers, including all supplemental papers filed, in connection with the Motion for Preliminary Approval of $500,000 Class and PAGA Action Settlement, the Court has identified following additional issues: 1. The bid from Atticus Administration, LLC is $10,800 (ROA 70, Ex. C), and there is no explanation why the preliminary approved amount should be any greater than the bid. 2. In the Class Notice, the court’s website has been provided but instructions on how to access the documents from the website have not been provided. Amendment, ¶18, p. 8. 3. The Request for Exclusion should contain language explaining what submitting the exclusion means, i.e. that the Class Member will not receive any portion of the class settlement, is not releasing any of the class claims and will retain the right to sue Defendant on his or her own behalf, and that the exclusion does not apply to the PAGA settlement, which is effective whether or not the individual cashes the check for the individual PAGA payment. 4. In paragraph 1 of the proposed Order, the first sentence should be revised to state: “The Court preliminarily approves the Settlement memorialized in the Parties’ Stipulation of Class Action and PAGA Settlement and Release, as modified by the Amendment to the Stipulation, which together, are attached here as Exhibit A.” 5. In paragraph 7 of the proposed Order, insert “(not to exceed)” between “$166,667” and “subject”. 6. In paragraph 8 of the proposed Order, insert “(not to exceed)” between “$20,000” and “subject”. 7. In paragraph 9 of the proposed Order, insert “(not to exceed)” between “$10,000” and “subject”. 8. In paragraph 10 of the proposed Order, insert “(not to exceed)” between $12,000” and “to be paid”. Plaintiff is ordered to submit a redlined revised Class Notice and redlined proposed Order addressing the issues above, along with clean versions and exhibits to the proposed Order within 5 days. If these issues are resolved to the Court’s satisfaction, the Court will GRANT the Motion subject to the following: $ 10,000.00 for Plaintiff’s enhancement (not to exceed); $ 166,667.00 for attorney’s fees (not to exceed); $ 20,000.00 for litigation costs (not to exceed); $ 10,800.00 for settlement administrator’s fees and costs (not to exceed); $ 18,750.00 for the LWDA share of PAGA penalties ($25,000 total for PAGA penalties). Plaintiff is ordered to give notice, including to the LWDA, and to file a proof of service. |
5. |
Ramirez vs. Cal Closets Retail, Inc. 2021-01184589 |
Having reviewed the papers, including all supplemental papers, filed in connection with the Motion for Preliminary Approval of $1,250,000 Class and PAGA Action Settlement, the Court GRANTS the Motion subject to the following: $15,000.00 for Plaintiffs’ enhancement (not to exceed $7,500 each); $ 416,666.67 for attorney’s fees (not to exceed 1/3 of the gross settlement amount); $ 20,000.00 for litigation costs (not to exceed); $ 30,000.00 for settlement administrator’s fees and costs (not to exceed); $ 75,000.00 for the LWDA share of the total $100,000 for PAGA penalties. Plaintiffs are ordered to give notice, including to the LWDA, and to file a proof of service. |
6. |
Ruiz vs. Priority Building Services, LLC 2021-01234179 |
Tentative pending. |
7. |
Salvation Investment, LLC vs. MO Murrayfield, LLC 2019-01050162 |
Tentative pending. |
8. |
Villani vs. Artech Information Systems LLC 2021-01187712 |
The hearing on Defendant’s Motion for an order striking the class and PAGA representative claims alleged in Plaintiff’s Complaint is CONTINUED to November 3, 2022 at 2:00 p.m. Based on the Court’s records, it does not appear that the proposed Order Granting The Phelps Law Group’s Motion to be Relieved as Counsel (ROA 163) was signed, filed and served on Plaintiff. Therefore, although The Phelps Law Group filed proof of service of the Court’s 7/14/2022 Minute Order granting The Phelps Law Group’s Motion to be Relieved as Counsel on Plaintiff on August 29, 2022 (ROA 208), the order is not effective until the filing of the proof of service of the signed Order (ROA 163) is served on Plaintiff. The Court has signed the Order (ROA 163). Defendant is ordered to give notice. |
9. |
Xiong vs. Jeunesse Global, LLC 2019-01095448 |
Plaintiff Helen Xiong moves for partial reconsideration of the Court’s June 23, 2022 Order and, by separate motion, for leave to file the “renewed second amended complaint”, i.e. the third amended complaint. For the reasons set forth below, the Court rules as follows: 1. The motion for partial reconsideration is DENIED. 2. In light of the ruling above, the motion for leave to file the “renewed second amended complaint” is DENIED as MOOT. Motions for reconsideration are governed by CCP § 1008 which reads, in pertinent part: “(a) When an application for an order has been made to a judge, or to a court, and refused in whole or in part, or granted, or granted conditionally, or on terms, any party affected by the order may, within 10 days after service upon the party of written notice of entry of the order and based upon new or different facts, circumstances, or law, make application to the same judge or court that made the order, to reconsider the matter and modify, amend, or revoke the prior order. The party making the application shall state by affidavit what application was made before, when and to what judge, what order or decisions were made, and what new or different facts, circumstances, or law are claimed to be shown. … (e) This section specifies the court’s jurisdiction with regard to applications for reconsideration of its orders and renewals of previous motions, and applies to all applications to reconsider any order of a judge or court, or for the renewal of a previous motion, whether the order deciding the previous matter or motion is interim or final. No application to reconsider any order or for the renewal of a previous motion may be considered by any judge or court unless made according to this section.” The requirement of new or different facts, circumstances or law is not procedural, it is jurisdictional. (Gilberd v. AC Transit (1995) 32 Cal.App.4th 1494, 1500 [motions for reconsideration are restricted to circumstances where a party offers fact or circumstance not previously considered and a valid reason for not offering it earlier].) Accordingly, “a court acts in excess of jurisdiction when it grants a motion to reconsider that is not based upon ‘new or different facts, circumstances, or law’”. (Id.) Here, Plaintiff asserts the motion is based on CCP § 1008, but the memorandum fails to identify any “new or different facts, circumstances or law” that provide the Court jurisdiction. Specifically, the declaration offered in support is deficient. It not only fails to identify any new or different facts, circumstances or law to support jurisdiction, it does not purport to provide any basis at all. (ROA 351; CCP § 1008(a) [“The party making the application shall state by affidavit…what new or different facts, circumstances, or law are claimed to be shown.”].) While not expressly arguing it, Plaintiff appears to assert that the new or different fact or law is the Court’s June 23, 2022 order sustaining the demurrer. In other words, the argument is that the Court misinterpreted the law. However, that basis does not support reconsideration and has been rejected as “specious.” (Gilberd, 32 Cal.App.4th at 1500 [“What respondent essentially argues is that section 1008 does not apply when the litigant disagrees with the trial court's ruling. Since in almost all instances, the losing party will believe that the trial court's ‘different’ interpretation of the law or facts was erroneous, to interpret [CCP 1008] as the respondent urges would be contrary to the clear legislative intent to restrict motions to reconsider to circumstances where a party offers the court some fact or authority that was not previously considered by it.”].) To the extent Plaintiff is inviting the Court to reconsider its prior ruling to correct an “error,” there is no basis to do so. The Court permitted extensive supplemental briefing and all of Plaintiff’s arguments and authorities presented here were considered prior to the Court’s June 23, 2022 ruling. Nothing Plaintiff has argued or cited disturbs the conclusion there is no support for Plaintiff’s “cure” argument, which has been rejected in other contexts requiring administrative exhaustion. (See, e.g., Miller v. United Airlines, Inc. (1985) 174 Cal.App.3d 878, 890 [The failure to exhaust administrative remedies pursuant to the FEHA requires judgment of dismissal, not abatement of the action as premature.]; see also Drink Tank Ventures LLC v. Real Soda in Real Bottles, Ltd. (2021) 71 Cal.App.5th 528, 541 [collecting cases].) Plaintiff’s Request for Judicial Notice Pursuant to Evid. Code §§ 452 and 453, Plaintiff requests judicial notice of the Register of Actions in Adolph v. Uber Technologies, Cal. Supreme Court. No. S274671. (ROA 380.) The Court declines to rule on the request as the document was immaterial to its ruling. Plaintiff’s Objections to Evidence Plaintiff objects to the Declarations of (1) Debbie Kurley and (2) Jeffrey S. Jacobson in their entirety based on (a) relevance, (b) improper opinion, and (c) content of a writing. Based on the Court’s ruling on the motion for leave to amend, the objections are MOOT. Plaintiff to give notice. |
Procedural Guidelines for Preliminary Approval of Class Action Settlements
Parties submitting class action settlements for preliminary approval should be certain that the following procedures are followed and that all of the following issues are addressed. Failure to do so may result in unnecessary delay of approval. It is also strongly suggested that these guidelines be considered during settlement negotiations and the drafting of settlement agreements.
1) NOTICED MOTION - Pursuant to California Rule of Court ("CRC") 3.769(c), preliminary approval of a class action settlement must be obtained by way of regularly noticed motion.
2) CLAIMS MADE VS. CHECKS-MAILED SETTLEMENT/CY PRES – The court typically finds that settlement distribution procedures that do not require the submission of claim forms, but rather provide for settlement checks to be automatically mailed to qualified recipients, result in greater benefit to the members of most settlement classes. If a claims-made procedure is proposed, the settling parties must be prepared to explain why that form is superior to a checks-mailed approach. If the settlement results in “unpaid residue or unclaimed or abandoned class member funds,” the agreement must comply with Code of Civil Procedure § 384.
3) REASONABLENESS OF SETTLEMENT AMOUNT – Admissible evidence, typically in the form of declaration(s) of plaintiffs’ counsel, must be presented to address the potential value of each claim that is being settled, as well the value of other forms of relief, such as interest, penalties and injunctive relief. Counsel must break out the potential recovery by claims, injuries, and recoverable costs and attorneys' fees so the court can discern the potential cash value of the claims and how much the case was discounted for settlement purposes. (See Kullar v. Foot Locker Retail, Inc. (2008) 168 Cal.App.4th 116.) Where the operative complaint seeks injunctive relief, the value of prospective injunctive relief, if any, should be included in the Kullar analysis. The court generally requires that this analysis be fully developed and supported at the preliminary approval stage. The analysis must state the number of anticipated class members (broken down by subclasses if applicable), and the final approval hearing papers must similarly state the number of class members (again by subclass, if applicable).
This analysis must also include a description of the expected low, average, and high payments to class members, and the expected amount to be received by the Plaintiff(s) (excluding any enhancement award).
4) ALLOCATION – In employment cases, if the settlement payments are divided between taxable and non-taxable amounts, a rationale should be provided consistent with counsel's Kullar analysis. The agreement and notice should clearly indicate whether there will be withholdings from the distribution checks, and who is paying the employer’s share of any payroll tax. The court is unlikely to approve imposing the employer’s share of payroll taxes on class members. If the operative complaint and the settlement include penalties under the Labor Code Private Attorneys General Act of 2004 ("PAGA"), proof of submission to the LWDA must be provided. (Labor Code §2999(l)(1).)
5) RELEASE - The release should be fairly tailored to the claims that were or could be asserted in the lawsuit based upon the facts alleged in the complaint. Releases that are overbroad will not be approved. Furthermore, while the court has no problem, conceptually, with the waiver by the named Plaintiff of the protection of Civil Code §1542, a 1542 waiver by the absent class members is generally inappropriate in the class settlement context. A comprehensive description of released claims as those arising out of the allegations of the operative complaint generally provides an adequate level of protection against future claims. A 1542 waiver, which by its own terms is not necessarily circumscribed by any definition of "Released Claims," goes too far. Also, although the court will not necessarily withhold approval on this basis, it generally considers a plain language summary of the release to be better than a verbatim rendition in the proposed class notice.
6) SETTLEMENT ADMINISTRATION - The proposed Settlement Administrator must be identified, including basic information regarding its level of experience. Where calculation of an individual’s award is subject to possible dispute, a dispute resolution process should be specified. The court will not approve the amount of the costs award to the Settlement Administrator until the final approval hearing, at which time admissible evidence to support the request must be provided. The court also generally prefers to see a settlement term that funds allocated but not paid to the Settlement Administrator will be distributed to the class pro rata.
The settlement should typically provide that the settlement administrator will conduct a skip trace not only on returned mail, but also on returned checks.
7) NOTICE PROCEDURE - The procedure of notice by first-class mail followed by re-sending any returned mail after a skip trace is usually acceptable. A 60-day notice period is usually adequate.
8) NOTICE CONTENT - The court understands that there can be a trade-off between precise and comprehensive disclosures and easily understandable disclosures and is willing to err on the side of making the disclosures understandable. By way of illustration, parties should either follow, or at least become familiar with the formatting and content of The Federal Judicial Center's "Illustrative" Forms of Class Action Notices at http://www.fjc.gov/, which conveys important information to class members in a manner that complies with the standards in the S.E.C.'s plain English rules. (17 C.F.R. § 230.421.)
Notices should always provide: (1) contact information for class counsel to answer questions; (2) an URL to a web site, maintained by the claims administrator or plaintiffs' counsel, that has links to the notice and the most important documents in the case; and (3) for persons who wish to review the court's docket in the case, the URL for the court: : https://ocapps.occourts.org/civilwebShoppingNS/Search.do
The motion should address whether translation(s) of the Notice and all attachments thereto should be provided to class members.
9) CLAIM FORM - If a claim form is used, it should not repeat voluminous information from the notice, such as the entire release. It should only contain that which is necessary to elicit the information necessary to administer the settlement.
10) EXCLUSION AND OBJECTION- The court prefers that the Notice be accompanied by a Form to be completed by the class member seeking to be excluded, and a separate Form to be completed by the class member wishing to object.
The notice need only instruct class members who wish to exclude themselves to send a letter to the settlement administrator setting forth their name and a statement that they request exclusion from the class and do not wish to participate in the settlement. It should not include or solicit extraneous information not needed to effect an exclusion. The same applies to the contents of the Form, if used.
Objections should also be sent to the settlement administrator (not filed with the court nor served on counsel). Thereafter counsel should file a single packet of all objections with the court. The court will not approve blanket statements that objections will be waived or not considered if not timely or otherwise compliant—rather, any such statements must be preceded by a statement that “Absent good cause found by the court….”
11) INCENTIVE AWARDS - The court will not decide the amount of any incentive award until final approval hearing, at which time evidence regarding the nature of the plaintiff's participation in the action, including specifics of actions taken, time committed and risks faced, if any, must be presented. (Clark v. American Residential Services LLC (2009) 175 Cal.App.4th 785, 804-807.)
12) ATTORNEY FEES - The court will not approve the amount of attorneys' fees until final approval hearing, at which time sufficient evidence must be presented for a lodestar analysis. Parties are reminded that the court will not award attorneys’ fees without reviewing information about counsel's hourly rate and the time spent on the case, even if the parties have agreed to the fees. (Laffitte v. Robert Half International, Inc. (2016) 1 Cal. 5th 480, 573-575.) Further information regarding fee approval is set forth in the court's Procedural Guidelines for Final Approval of Class Action Settlements (below).
At the final approval hearing, Plaintiff’s counsel must disclose whether they have any fee-splitting arrangement with any other counsel or confirm none exists. (Barnes, Crosby, Fitzgerald & Zeman, LLP v. Ringler (2012) 212 Cal.App.4th 172, 184; California Rules of Court, rule 3.769(b).)
13) CONCURRENT PENDING CASES – The declaration(s) filed in support of the motion must inform the court as to whether the parties, after making reasonable inquiry, are aware of any class, representative or other collective action in any other court that asserts claims similar to those asserted in the action being settled. If any such actions are known to exist, the declaration shall also state the name and case number of any such case and the procedural status of that case. (Trotsky vs. Los Angeles Fed. Sav. & Loan Assn. (1975) 48 Cal. App. 3d 134, 148; Effect of failure to inform court of another pending case on same or similar issues.)
14) PROPOSED ORDER GRANTING PRELIMINARY APPROVAL – All proposed orders should include the requisite "recital," "finding," and "order" language, including adequate information to provide clear instruction to the settlement administrator. The proposed order should also attach the proposed notice and any associated forms as exhibits. The proposed order must contain proposed dates for all future events contemplated therein.
Procedural Guidelines for Final Approval of Class Action Settlements
Parties submitting class action settlements for final approval should be certain that the following procedures are followed, and that all of the following issues are addressed. Failure to do so may result in unnecessary delay of final approval.
1) Since the date and place of final approval hearings are set by the preliminary approval order, notice of which is typically included in the notice to class members of the settlement itself (California Rules of Court [“CRC”] 3.769(e) & (f)), the final approval hearing is outside the scope of Code of Civil Procedure §1005. Nevertheless, settling parties should caption their papers submitted in support of final approval as a “Motion for Final Approval,” and set the matter for hearing on the reserved date.
2) With rare exceptions, the court will expect all issues related to final approval to be heard at the same time, including, without limitation, (a) final approval of the settlement itself, (b) approval of any attorney’s fees request, (c) approval of incentive awards to class representatives, and (d) approval of expense reimbursements and costs of administration. If the settling parties elect to file separate motions for any of these categories, the motions must be set on the same day.
3) All requests for approval of attorney’s fees awards, whether included in a Motion for Final Approval or made by way of a separate motion, must include detailed lodestar information, even if the requested amount is based on a percentage of the settlement fund. The court generally finds the declarations of class counsel as to hours spent on various categories of activities related to the action, together with hourly billing-rate information, to be sufficient, provided it is adequately detailed. It is generally not necessary to submit copies of billing records themselves with the moving papers, but counsel should be prepared to submit such records at the court’s request.
Plaintiff’s counsel must disclose whether they have any fee-splitting arrangement with any other counsel or confirm none exists. (Barnes, Crosby, Fitzgerald & Zeman, LLP v. Ringler (2012) 212 Cal.App.4th 172, 184; California Rules of Court, rule 3.769(b).)
4) Requests for approval of enhancement/incentive payments to class representatives must include evidentiary support consistent with the parameters outlined in Clark v. American Residential Services LLC (2009) 175 Cal.App.4th 785, 804-807.
5) For all settlements that include a distribution to settlement class members, a final compliance hearing must be set, which requires the submission and approval of a final compliance status report after completion of the distribution process. The compliance hearing will be set when final approval is granted, so the moving papers should include a suggested range of dates for this purpose. The compliance status report must be filed at least 5 court days prior to the compliance hearing.
6) In light of the requirements of CRC 3.769(h), all final approvals must result in the entry of judgment, and the words “dismissal” and “dismissed” should be avoided not only in proposed orders and judgments, but also in settlement agreements.
7) To ensure appropriate handling by the court clerk, the court prefers the use of a combined “order and judgment,” clearly captioned as such (e.g. “Order of Final Approval and Judgment” or “Order and Judgment of Final Approval”). The body of the proposed order and judgment must also incorporate the appropriate “judgment is hereby entered” language, and otherwise fully comply with California Rule of Court (“CRC”) 3.769(h), including express reference to that rule as the authority for the court’s continuing jurisdiction. The proposed order and judgment should also include the compliance hearing provision (with suggested date and time) discussed above.
8) If the actions that are being settled are included in a Judicial Council Coordinated Proceedings (“JCCP”), termination of each included action by entry of judgment is subject to CRC 3.545(b) & (c), and proposed orders and judgments must so reflect. Language must also be included to the effect that compliance with CRC 3.545(b)(1 & 2) shall be undertaken by class counsel, and that a declaration shall be filed confirming such compliance.
9) All proposed orders and judgments should include all the requisite “recital,” “finding,” “order” and “judgment” language in a manner that clarifies the distinctions between these elements, and care must be taken that all terms that require definition are either defined in the proposed order and judgment itself or that definitions found elsewhere in the record are clearly incorporated by reference. No proposed order and judgment should be submitted until after review by counsel for each settling party.
Procedural Guidelines for PAGA Settlements
(Private Attorney General Act of 2004, Labor Code sections 2698 et seq.)
Pursuant to Labor Code section 2699(1)(2): “The superior court shall review and approve any settlement of any civil action filed pursuant to this part.”
While the court will review every such motion for approval on its own merits, the court requires that at a minimum the settlement and/or any order or judgment requested from the court in connection with it must contain at least the following.
1. A comprehensive definition of the group of allegedly aggrieved employees represented by plaintiff in the action.
2. A definition of the PAGA claims encompassed by the settlement, premised on the allegations of the operative complaint.
3. The total consideration being provided by defendant(s) for the settlement (“gross settlement amount”), and a description of each allocation of the consideration, such that all of the total consideration is accounted for. This description must include:
a. A description of all consideration being received by plaintiff, including for plaintiff's individual claims and PAGA claims
b. A description of all consideration being received by aggrieved employees including, as applicable, civil penalties and/or unpaid wages.
c. A statement of the amount of consideration that will be subject to the 75%/25% allocation required by section 2699(i)
d. The amounts sought for attorney’s fees, attorney costs, and costs of administration.
e. Any amount sought as a plaintiff’s enhancement.
f. A description of any other amount(s) being deducted from the gross settlement amount.
4. An explanation as to how the amount payable to each purported aggrieved employee is to be calculated.
5. An explanation as to why the attorneys’ fees and costs sought are reasonable within the meaning of Labor Code section 2699 (g) (1).
6. A description of the tax treatment for any of the payments to plaintiff and/or aggrieved employees.
7. A provision setting forth the disposition of unclaimed funds, i.e., checks uncashed within a stated period of time after being sent to aggrieved employees.
8. A provision that the proposed settlement be submitted to the Labor and Workforce Development Agency at the same time that it is submitted to the court. (Labor Code section 2699(l)(2))
9. A provision that the Court will retain jurisdiction to enforce the settlement pursuant to CCP section 664.6.
10. A notice to aggrieved employees that will accompany the payment to them. A copy of such notice is to be provided to the court for approval along with the motion seeking approval of the settlement. The notice must inform the recipient as to the scope of the released claims, and as to the recipient’s responsibility for any taxes payable on the amount received.
11. Releases that do not include Civil Code section 1542 releases for aggrieved employees other than plaintiff.
12. Releases that release, for aggrieved employees other than plaintiff, no more than the civil penalties available under PAGA by reason of the facts alleged in the operative complaint.
Counsel’s declaration(s) in support of the motion must state whether the parties (Plaintiff(s) and Defendant(s)) know of any other cases that may be impacted by the settlement.
The moving papers must include a copy of all written notices to the LWDA pursuant to Labor Code section 2699.3(a)(1)(A).