Rest break and wage statement claims denied certification; Court appears to confuse PAGA requirements with other civil claims

United States District Court Judge Susan Illston (Northern District of California) denied certification in a suit by security guards alleging, among other things, failure to provide adequate rest breaks and failure to provide adequate wage statements.  Temple v. Guardsmark LLC, 2011 WL 723611 (N.D.Cal. Feb 22, 2011).  The rest break analysis was not particularly controversial.  The Order suggests that the defendant had a facially lawful policy and a large number of declarants supporting its practices.  The Court also agreed with defendant's observation that "even if plaintiffs have isolated one general question of whether the narrow California-specific policy displaced the general, national always-on-duty [policy], that question does not have a common answer."  Slip op., at 6.

The problematic portion of the Opinion concerns the wage statement claim.  There is no mention anywhere that the wage statement claim is purely derivative of a PAGA claim.  But the Court seems to impose an administrative exhaustion claim on Labor Code section 226:

California Labor Code Section 226(a) requires wage statements to show “all applicable hourly rates in effect during the pay period and the corresponding number of hours worked at each hourly rate by the employee.” California law also requires that employees be paid double their regular rate of pay for every hour worked over twelve hours in a single day. Cal. Labor Code § 510. Finally, California requires that an “aggrieved employee or representative ... give written notice by certified mail to the Labor and Workforce Development Agency and the employer of the specific provisions of this code alleged to have been violated, including the facts and theories to support the alleged violation,” before bringing a civil action based on violation of Section 226(a) of the Labor Code.  Cal. Labor Code §§ 2699.3, 2699.5.

Slip op., at 7.  It is settled law in California that PAGA did not displace any civil actions that could have been brought prior to its passage.  And there is no reason to conclude that PAGA requires LWDA exhaustion for anything other than PAGA claims.  It is unclear from the Order why this issue is discussed in this way.  It may be that the plaintiff attempted to circumvent a statute of limitations issue by claiming that a PAGA claim for other violations gave sufficient notice of the wage statement claim to permit relation back to the filing of an earlier complaint.  Whatever the case, the Order is dangerously unclear and incorrectly suggests an exhaustion requirement under 226 that does not exist.

Reasonable lodestar hourly rates in the Northern District of California

For those keeping track of such things, United States District Court Judge Marilyn Hall Patel (Northern District of California) found "reasonable attorneys fees based on rates of $650 for partner services, $500 for associate attorney services and $150 for paralegal services. See Suzuki v. Hitachi, 2010 WL 956896 *3 (N.D.Cal. March 12, 2010)."  Faigman v. AT&T Mobility LLC, 2011 WL 672648 (N.D.Cal. Feb 16, 2011).  The opinion also noted that counsel requesting a higher rate should provide information supporting the departure from those presumptively reasonable hourly rates.

In re Baycol Cases I and II provides more guidance on operation of "death knell" doctrine in class action appeals

In California, the right to appeal is generally governed by the “one final judgment” rule, under which most interlocutory orders are not appealable.  (See Code Civ. Proc., § 904.1.)1  But Daar v. Yellow Cab Co.,  67 Cal.2d 695 (1967) concluded that an exception was necessary because orders dismissing all class action claims might in some instances escape review.  The Supreme Court created what is now referred to as the “death knell” doctrine, allowing a party to appeal such class action claim dismissal orders immediately, even though they are not final.  In re Baycol Cases I and II (February 28, 2011) marks the the Supreme Court's return to that docrine.

In 2007, after consolidation with other actions in a Judicial Council Coordinated Proceeding, Plaintiff filed a first amended complaint, adding to the UCL and unjust enrichment claims a claim under the Consumers Legal Remedies Act (Civ. Code, § 1750 et seq.). Bayer demurred to both the class allegations and each substantive claim. On April 27, 2007, the trial court sustained the demurrer in its entirety without leave to amend. It thereafter denied Shaw's motion for reconsideration on both class and individual claims and entered a judgment of dismissal. Bayer served a notice of entry of judgment on October 29, 2007, and Shaw filed his notice of appeal on December 20, 2007. The Court of Appeal reversed dismissal of Shaw's individual UCL claim, concluding he should have been granted leave to amend. However, it declined to consider on the merits the appeal of the class claims dismissal and instead dismissed that portion of the appeal. Relying on cases that have held death knell orders terminating class claims are immediately appealable, the Court of Appeal reasoned that, upon entry of the April 27, 2007, order sustaining Bayer's demurrer, the class claims dismissal, unlike the individual claims dismissal, was appealable. Consequently, the December 20, 2007, notice of appeal was, as to the class claims, untimely. (See Cal. Rules of Court, rules 8.104, 8.108(e).)

The Supreme Court reversed, concluding that the preservation of individual claims is an essential prerequisite to application of the death knell doctrine. The doctrine renders appealable only those orders that effectively terminate class claims but permit individual claims to continue. When an order terminates both class and individual claims, there is no need to apply any special exception to the usual one final judgment rule to ensure appellate review of class claims. Instead, routine application of that rule suffices to ensure review while also avoiding a multiplicity of appeals.

Windows Phone 7: What's the deal?

"Murder will out, certain, it will not fail." –Geoffrey Chaucer

Sorry to have been remiss in my posts recently, but a move to a new home has been far longer and far more painful than anticipated.  That doesn't mean that I'm not paying attention to current events; I just haven't had time to write about them.

One current event that has been on my radar involves Microsoft's new mobile phone operating system, creatively called Windows Phone 7.  I was very excited by the previews I saw.  I dumped my iPhone for one of these phones on release day.  The operating system is, in my opinion, much more elegant than the iPhone OS.  I still like it.  One problem: the phone updates that Microsoft promised to release before the end of 2010 still aren't here.  Whose to blame?  Microsoft?  The various carriers?  Handset manufacturers?  The truth will out, as they say.

Microsoft was painfully silent about what was happening.  It didn't say anything about what was happening or where the blame who  Then the Interwebs began to pound away (e.g., this post on the Windows Team Blog and this AT&T discussion thread on Facebook, and, yes, I gave both of them a hard time).  Then Microsoft announced that all was well with the "NoDo" update and announced its release.  Problem is, nobody was receiving updates...at least on AT&T.  Then some industrious snooper found a  page on microsoft.com that clears things up a bit - the Where's My Phone Update page.  Notice (if you care) how the AT&T phones are all in the "testing" phase, while other phones have update delivery scheduled.  I call horse hockey on AT&T.  It isn't "testing" this update.  The update was done in December.  I believe that I am officially being jerked around.

Very poor form, AT&T.  You deserve all the contempt you receive on this issue.  So do you, Microsoft, for being such wimps about a project that you can't afford to let flop out the gate.  One might even say that I might not have purchased the phone or would have paid less for it had I known the truth about how updates would (or would not) work to add missing features in a timely manner and fix bugs. I feel like I am the target of unfair competition...

Update on 2011-03-24 23:21 by The Complex Litigator

Ars Technica has some excellent coverage of the silent goliaths in a post from earlier today.

Oral argument scheduled in Sullivan et al. v. Oracle Corporation et al.

On Wednesday, April 6, 2011, the California Supreme Court will hear argument in the matter of Sullivan, et al. v. Oracle Corporation, et al.  On February 17, 2009, the matter was certfied to the California Supreme Court by the Ninth Circuit.  Justice Roger Boren, from the Second Appellate District, Division Two, was assigne as justice pro tempore.  The questions certified to the California Supreme Court are:

First, does the California Labor Code apply to overtime work performed in California for a California-based employer by out-of-state plaintiffs in the circumstances of this case, such that overtime pay is required for work in excess of eight hours per day or in excess of forty hours per week?

Second, does § 17200 apply to the overtime work described in question one?

Third, does § 17200 apply to overtime work performed outside California for a California-based employer by out-of-state plaintiffs in the circumstances of this case if the employer failed to comply with the overtime provisions of the FLSA?

As a side note, the argument calendar also shows that Brinker is not on the April agenda.  Do I hear May anyone?  And by "May," you all know I mean May 2012, right?

Seymore v. Metson Marine, Inc. offers guidance on 7th day overtime, on call work

Plaintiffs worked consecutive 14-day “hitches” on Metson's ships, providing emergency clean up of oil spills and other hazardous chemical spills off the California coast.  This arrangement gave rise to questions about how Metson calculated pay for the seventh consecutive workday in a week and compensation for employees when on call.  In Seymore v. Metson Marine, Inc. (February 28, 2011), the Court of Appeal (First Appellate District, Division Three) reversed an order granting summary judgment in favor of Metson.

On the seventh day of overtime issue, Metson set the start time of the workweek so that employees only worked one "workweek" of seven consecutive days in the 14-day hitch.  On an issue of first impression, the Court rejected that manipulation:

Metson's attempt to evade the requirements of sections 500 and 510 is no different from the method struck down in the Wal-Mart case. Under the plain language of section 510, plaintiffs are entitled to premium pay “on the seventh day of work in any one workweek” and according to section 500, a workweek is defined to mean “any seven consecutive days, starting with the same calendar day each week.” The clear intent of this statute is to provide premium pay for employees who are required to work a seventh consecutive day in a “fixed and regularly” occurring workweek. Metson's attempt to circumvent this requirement cannot be condoned. (Huntington Memorial Hospital v. Superior Court (2005) 131 Cal.App.4th 893, 910 [“The bottom line is this: An employer may not engage in a subterfuge or artifice designed to evade the overtime laws”].)

Slip op., at 5.  The Court found a DLSE memorandum on the issue to be in potential conflict with the statutory language and disregarded it.

Turning to whether Metson's control was sufficient to establish an obligation to pay for on-call time, the Court reviewed the evidence de novo, finding one fact in particular to be the key determinant, the obligation to sleep on Metson's premises:

Metson cites a number of cases in which courts have concluded that on-call employees able to engage in such personal activities and subject to even shorter response time requirements were not entitled to compensation. (See Gomez, supra, 173 Cal.App.4th 508 [30-minute telephone response time]; Dinges v. Sacred Heart St. Mary’s Hosps. (7th Cir. 1999) 164 F.3d 1056 [7-minute response time]; Bright v. Houston Northwest Medical Center Survivor, Inc. (5th Cir. 1991) 934 F.2d 671 [20-minute response time].) However, there is one critical difference between each of those cases and the present situation —in none of those cases was the employee required to sleep at the employer's premises. In Bright, the court observed that the situation there was “wholly different” from cases in which employees were required to serve their on-call time at the employer's premises because “Bright did not have to remain on or about his employer's place of business, or some location designated by his employer, but was free to be at his home or at any place or places he chose, without advising his employer, subject only to the restrictions that he be reachable by beeper, not be intoxicated, and be able to arrive at the hospital in 'approximately' twenty minutes.” (934 F.2d at p. 676.)

Slip op., at 10.  (As an aside, I find it amusing that two cases I handled, one on the prevailing side and one on the losing side, factored into the Court's discussion of this on-call issue.  Glad I didn't completely screw it up for the plaintiffs here.)  In any event, after an extended discussion of how California parallels but does not exactly follow FLSA precedent surrounding this issue, the Court then spent a moment discussing the fact that, in California, an employer may agree with an employee to designate eight sleeping hours as uncompensated time when an employee works a 24-hour shift.  The Court concluded by suggesting that Metson's arguments about the need for revised exceptions to current wage orders (or a new wage order) were worthy of consideration but did not provide a basis for the Court to disregard existing law.