Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_07-cv-02328/USCOURTS-cand-3_07-cv-02328-11/pdf.json

Parties Involved:
UBS Financial Services Inc.
Defendant
David Waisbein
Plaintiff

Document Text:

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EXHIBIT A 

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THIRD AMENDED COMPLAINT

CV 07-02328 MMC 

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Mark Yablonovich (SBN 186670) 

MYablonovich@InitiativeLegal.com 

Joseph Cho (SBN 198844) 

JCho@InitiativeLegal.com 

Gregory Yu (SBN 230520) 

GYu@InitiativeLegal.com 

Shawn Westrick (SBN 235313) 

SWestrick@InitiativeLegal.com 

Initiative Legal Group LLP 

1800 Century Park East, 2nd Floor 

Los Angeles, California 90067 

Telephone: (310) 556-5637 

Facsimile: (310) 861-9051 

Attorneys for Plaintiff/Class Members 

UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF CALIFORNIA 

DAVID WAISBEIN, individually, and on 

behalf of other members of the general 

public similarly situated, 

 Plaintiffs, 

vs. 

UBS FINANCIAL SERVICES INC; and 

DOES 1 through 20, inclusive, 

 Defendants. 

Case Number: CV 07-02328 MMC

[Class Action Pursuant to California

Code of Civil Procedure § 382, 

Collective Action under the Fair Labor 

Standards Act, and a representative 

action under the California Private 

Attorneys General Act] 

Third Amended Complaint For: 

(1) Violation of 29 U.S.C. § 207; 

(2) Violation of California Labor Code

§§ 510 and 1194; 

(3) Violation of California Labor Code

§ 226(a); 

(4) Violation of California Labor Code

§ 226.7(a); 

(5) Violation of California Labor Code

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§§ 221, 400-410, 2802 and 8 C.C.R. § 

11040

(6) Violation of California Labor Code

§§ 201 and 202; and 

(7) Violation of California Business & 

Professions Code § 17200, et seq.; 

Jury Trial Demanded

Plaintiff, individually and on behalf of all others similarly situated, and on 

behalf of the general public, alleges as follows: 

JURISDICTION AND VENUE

1. This Court has jurisdiction over this matter pursuant to 29 U.S.C. § 216(b) 

and 28 U.S.C. §§ 1331. 

2. Further, this Court has supplemental jurisdiction under 28 U.S.C. § 1367 

over Plaintiffs’ state law claims because those claims derive from a common nucleus 

of operative facts. 

3. In addition, this Court is empowered to issue a declaratory judgment 

pursuant to 28 U.S.C. §§ 2201 and 2202. 

4. Venue is proper pursuant to 28 U.S.C. § 1391, as a substantial part of the 

acts or omissions giving rise to the claims alleged herein occurred within this judicial 

district, and the Defendants are subject to personal jurisdiction in this district. 

THE PARTIES

5. Plaintiff DAVID WAISBEIN (hereinafter “WAISBEIN” or “Plaintiff”), is 

a United States citizen and resident of San Mateo County, in the state of California. 

6. Defendant UBS FINANCIAL SERVICES GROUP INC (hereinafter 

“Defendant”) was and is, upon information and belief, a corporation doing business 

within the state of California, and at all material times hereinafter mentioned. 

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Defendant is in the business of providing investment banking, securities trading and 

brokerage services. 

7. Plaintiff is unaware of the true names or capacities of the Defendants sued 

herein under the fictitious names DOES 1-20, but prays for leave to amend and serve 

such fictitiously named Defendants pursuant to California Code of Civil Procedure § 

474, once their names and capacities become known. 

8. Plaintiff is informed and believes, and thereon alleges, that Does 1-20 are 

the partners, owners, shareholders or managers of Defendants, and were acting on 

behalf of Defendants. 

9. Plaintiff is informed and believes, and thereon alleges, that each of said 

Defendants are in some manner intentionally, negligently, or otherwise responsible for 

the acts, occurrences and transactions alleged herein. 

10. Plaintiff is informed and believes, and thereon alleges, that each and all of 

the acts and omissions alleged herein were performed by, or are attributable to, all 

Defendants, each acting as the agent for the other, with legal authority to act on the 

other’s behalf. The acts of Defendants were in accordance with, and represent the 

official policy of, Defendants. 

11. At all times herein mentioned, Defendants, and each of them, ratified each 

and every act or omission complained of herein. At all times herein mentioned, the 

Defendants, and each of them, aided and abetted the acts and omissions of each and all 

the other Defendants in proximately causing the damages herein alleged. 

COLLECTIVE/CLASS ACTION ALLEGATIONS

12. Plaintiff brings this suit on behalf of the following similarly situated 

persons:

a. All current and former securities brokers and broker trainees, or 

persons with similar titles and/or similar job duties, including but 

not limited to Unregistered Trainees (job codes 226 and 008226), 

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Brokers (job codes 456 and 008456), and Registered Trainees (job 

codes 457 and 008457) who worked for Defendant outside the State 

of California at any time during the period from three years prior to 

the filing of this action to the date of preliminary approval 

(“Nationwide Collective Class”); 

b. All current and former securities brokers and broker trainees, or 

persons with similar titles and/or similar job duties, including but 

not limited to Unregistered Trainees (job code 226), Brokers (job 

code 456), and Registered Trainees (job code 457) who worked for 

Defendant in the State of California at any time during the period 

from four years prior to the filing of this action to the date of 

preliminary approval (the “California Class”); 

13. Plaintiff brings this action on behalf of the Nationwide Collective Class as 

a collective action pursuant to the Fair Labor Standards Act, section 216(b) and on 

behalf of the California Class as a class action for claims under the California Labor 

Laws pursuant to the Federal Rules of Civil Procedure 23. Collectively, the 

Nationwide Collective Class and the California Class shall hereinafter be referred to as 

“the Classes.” 

14. The claims under the FLSA may be pursued by those who opt-in to this 

case pursuant to 29 U.S.C. § 216(b). The claims under the California Labor Laws may 

be pursued by all similarly-situated persons who choose not to opt-out of the California 

Class, pursuant to the Federal Rules of Civil Procedure 23. 

Allegations Applicable to All Classes

15. The members of each of the Classes are so numerous that joinder of all 

members is impracticable. The exact number of the members of the Classes can be 

determined by reviewing Defendant’s records. Plaintiffs are informed and believe and 

thereon allege that there are hundreds of individuals in each defined class. 

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16. Plaintiff will fairly and adequately protect the interests of the Classes and 

have retained counsel that is experienced and competent in class action and 

employment litigation. Plaintiff has no interests that are contrary to, or in conflict 

with, members of the Classes. 

17. A class action/collective action suit, such as the instant one, is superior to 

other available means for fair and efficient adjudication of this lawsuit. The damages 

suffered by individual members of the Classes may be relatively small when compared 

to the expense and burden of litigation, making it virtually impossible for members of 

the Classes to individually seek redress for the wrongs done to them. 

18. A class and collective action is, therefore, superior to other available 

methods for the fair and efficient adjudication of the controversy. Absent these 

actions, the members of the Classes likely will not obtain redress of their injuries, and 

Defendant will retain the proceeds of their violations of the FLSA and applicable 

California Labor Laws. 

19. Furthermore, even if any member of the Classes could afford individual 

litigation against the Company, it would be unduly burdensome to the judicial system. 

Concentrating this litigation in one forum will promote judicial economy and parity 

among the claims of individual members of the Classes and provide for judicial 

consistency.

20. There is a well-defined community of interest in the questions of law and 

fact affecting the Classes as a whole. The questions of law and fact common to each 

of the Classes predominate over any questions affecting solely individual members of 

the action. Among the common questions of law and fact are: 

a. Whether securities broker, broker trainee or any other job position 

with similar title and/or duties were properly classified as exempt by Defendant from 

overtime compensation; 

b. Whether Defendant lacks a retail concept; 

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c. Whether Plaintiff and members of the Classes were expected to, 

and/or did as a matter of corporate policy and practice, regularly work hours in excess 

of forty (40) per week and/or in excess of eight (8) hours per day; 

d. The manner in which Plaintiff and members of the Classes were 

compensated; and 

e. Whether Plaintiff and the Classes have sustained damages and, if 

so, what is the proper measure of damages. 

Allegations Specific to the Nationwide Collective Class

21. Pursuant to 29 U.S.C. § 207, Plaintiffs seek to prosecute the FLSA claims 

as a collective action on behalf of themselves and the Nationwide Collective Class. 

22. Notice of the pendency and any resolution of this action can be provided 

to the Nationwide Collective Class by mail, print, and/or internet publication. 

Allegations Specific to the California Class

23. CA Plaintiffs bring this action as a California state class action pursuant to 

Rules 23(a) and (b) of the Federal Rules of Civil Procedure on behalf of themselves 

and the California Class. 

24. In addition to the common issues of fact and law described above, the 

California Class Members have numerous common issues of fact, including: 

a. Whether Defendant failed to compensate adequately the members 

of the CA Class for overtime hours worked as required by California Wage Order 4-

2001, 8 C.C.R. § 11040 and California Labor Code § 510; 

b. Whether Defendant failed to provide all required meal and rest 

breaks in violation of California Labor Code § 226.7; 

c. Whether Defendant committed acts of unfair competition under 

California Business & Professions Code § 17200 et seq., by not paying the required 

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overtime pay and/or compensation for missed meal and rest periods as required by 

applicable employment laws; and 

d. Whether Defendant failed to maintain and provide members of the 

CA Class with accurate and detailed records of hours worked and wages earned, 

pursuant to California Labor Code § 226. 

LABOR CODE PRIVATE ATTORNEYS

GENERAL ACTION ALLEGATIONS

25. Plaintiff is informed and believes, and thereon alleges, that during the 

relevant time period, the California Industrial Welfare Commission (“IWC”) Order and 

California Labor Code § 2699 was applicable to Plaintiff’s employment by 

Defendants.

26. Plaintiff is informed and believes, and thereon alleges, that PAGA 

provides that for any provision of law under the California Labor Code that provides 

for a civil penalty to be assessed and collected by the California Labor and Workforce 

Development Agency (“Agency”) for violation of the California Labor Code, may, as 

an alternative, be recovered through a civil action brought by an aggrieved employee 

on behalf of himself and other current or former employees pursuant to procedures 

outlined in California Labor Code § 2699.3. 

27. Pursuant to California Labor Code § 2699, a civil action under PAGA 

may be brought by an “aggrieved employee,” who is any person that was employed by 

the alleged violator and against whom one or more of the alleged violations was 

committed. 

28. Plaintiff was employed by the Defendants and the alleged violations were 

committed against him during his time of employment, and he is therefore, an 

aggrieved employee. 

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29. Plaintiff has satisfied the administrative exhaustion requirements of 

PAGA, pursuant to Cal. Lab. Code § 2699.3, and may allege claims and remedies 

under PAGA. 

FACTUAL ALLEGATIONS

30. At all material times set forth herein, Defendants employed Plaintiff as an 

exempt securities broker in the State of California from October 1994 until January 

2006.

31. At all material times set forth herein, Defendants consistently failed to 

properly pay regular and overtime wages to Plaintiff and all members of the Classes 

and all aggrieved employees.

32. Defendants knew or should have known that Plaintiff and all members of 

the Classes and all aggrieved employees were not receiving proper regular or premium 

overtime wages, because, among other things, Defendants’ agents, officers and 

employees witnessed Plaintiff and all members of the Classes and all aggrieved 

employees working hours entitling Plaintiff and all members of the Classes and all 

aggrieved employees to such wages and Defendants’ own work schedules indicate that 

these hours were worked. 

33. Plaintiff is informed and believes, and thereon alleges that at all material 

times set forth herein, Defendants knew that they had a duty to compensate Plaintiff 

and all members of the Classes and all aggrieved employees and that Defendants had 

the financial ability to pay such compensation, but willfully, knowingly and 

intentionally failed to do so, solely to increase Defendants’ profits.

34. Plaintiff is informed and believes, and thereon alleges that at all material 

times set forth herein, Defendants knew or should have known that Plaintiff and all 

members of the Classes and all aggrieved employees did not receive, but were entitled 

to receive, complete and accurate wage statements in accordance with California law. 

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35. Plaintiff is informed and believes, and thereon alleges that at all material 

times set forth herein, Defendants knew or should have known that Plaintiff and all 

members of the Classes and all aggrieved employees did not receive, but were entitled 

to receive, all meal and rest breaks or payment of one hour of pay when a break was 

missed. 

36. Plaintiff is informed and believes, and thereon alleges that at all material 

times set forth herein, Defendants knew or should have known that Plaintiff and all 

members of the California Class and all aggrieved employees did not receive, but were 

entitled to receive, full reimbursement for all business-related expenses and costs they 

incurred during the course and scope of their employment, and that they did not 

receive full reimbursement of applicable business-related expenses and costs they 

incurred.

37. Plaintiff is informed and believes, and thereon alleges that at all material 

times set forth herein, Defendants knew or should have known that Plaintiff and all 

members of the California Class and all aggrieved employees were entitled to not have 

to pay wages back to their employer. 

38. Plaintiff is informed and believes, and thereon alleges that at all material 

times set forth herein, Defendants knew or should have known that Plaintiff and all 

members of the California Class and all aggrieved employees did not receive, but were 

entitled to receive, all the wages owed to them upon discharge. 

39. California Labor Code § 218 states that nothing in Article 1 of the Labor 

Code shall limit the right of any wage claimant to “sue directly...for any wages or 

penalty due him under this article.” 

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FIRST CAUSE OF ACTION

Violation of 29 U.S.C. § 207 

(Against all Defendants) 

(For Nationwide Collective Class) 

40. Plaintiff incorporates by reference and realleges as if fully stated herein 

the allegations set out in paragraphs 1 through 39 of this Complaint. 

41. The Fair Labor Standards Act, 29 U.S.C. § 207(a)(1) (“FLSA”), provides 

in relevant part, 

 Except as otherwise provided in this section, no employer shall employ 

any of his employees, who in any workweek is employed in an enterprise 

engaged in commerce or in the production of goods for commerce, for a 

workweek longer than forty hours unless such employee receives 

compensation for his employment in excess of the hours above specified 

at a rate not less than one and one-half times the regular rate at which he 

is employed. 

42. At all material times set forth herein, Plaintiff and all members of the 

Nationwide Collective Class did not qualify for “exempt” status under the FLSA 

because, inter alia, Plaintiff and all members of the Nationwide Collective Class were 

not paid on a salary basis; the primary duties of Plaintiff and all members of the 

Nationwide Collective Class did not consist of office or nonmanual work directly 

related to the management or general business operations of Defendants or 

Defendants’ customers; Plaintiff and all members of the Nationwide Collective Class 

did not exercise discretion and independent judgment with respect to matters of 

significance; and Defendants’ businesses did not qualify as either “retail or service 

establishments.”

43. At all material times set forth herein, Plaintiff and all members of the 

Nationwide Collective Class consistently worked in excess of forty hours in a 

workweek; however, the proper overtime compensation was not paid by Defendants. 

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44. At all material times set forth herein, Defendants’ failure to pay Plaintiff 

and all members of the Nationwide Collective Class the unpaid balance of overtime 

compensation, as required by the FLSA, violated the provisions of the FLSA and was 

therefore unlawful. 

45. Pursuant to the FLSA, Plaintiff and all members of the Nationwide 

Collective Class are entitled to recover unpaid overtime compensation as well as 

interest, costs, attorneys’ fees and other remedies available under the FLSA.

46. Defendants have been guilty of oppression, fraud, or malice, and should 

be punished for the sake of example. Therefore, Plaintiff and all members of the 

Nationwide Collective Class are entitled to punitive damages.

SECOND CAUSE OF ACTION

Violation of California Labor Code §§ 510 and 1194 

(Against all Defendants) 

(For the California Class) 

47. Plaintiff incorporates by reference and realleges as if fully stated herein 

the allegations set out in paragraphs 1 through 46 of this Complaint. 

48. California Labor Code § 510(a) provides in relevant part, 

 Eight hours of labor constitutes a day’s work. Any work in excess of 

eight hours in one workday and any work in excess of 40 hours in any one 

workweek and the first eight hours worked on the seventh day of work in 

any one workweek shall be compensated at the rate of no less than one 

and one-half times the regular rate of pay for an employee. Any work in 

excess of 12 hours in one day shall be compensated at the rate of no less 

than twice the regular rate of pay for an employee. In addition, any work 

in excess of eight hours on any seventh day of a workweek shall be 

compensated at the rate of no less than twice the regular rate of pay of an 

employee. 

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49. California Labor Code § 515(a) provides in relevant part, 

 The Industrial Welfare Commission may establish exemptions from the 

requirement than an overtime rate of compensation be paid pursuant to 

Sections 510 and 511 for executive, administrative, and professional 

employees, provided that the employee is primarily engaged in the duties 

that meet the test of the exemption, customarily and regularly exercises 

discretion and independent judgment in performing those duties, and 

earns a monthly salary equivalent to no less than two times the state 

minimum wage for full-time employment. 

50. At all material times set forth herein, Plaintiff and all members of the 

California Class and all aggrieved employees did not qualify for “exempt” status under 

the California Labor Code because, inter alia, Plaintiff and all members of the 

California Class and all aggrieved employees were not primarily engaged in the duties 

that meet any potential exemptions and Plaintiff and all members of the California 

Class and all aggrieved employees did not customarily and regularly exercise 

discretion and independent judgment in performing those duties. 

51. California Labor Code § 515(d) provides in relevant part, 

For the purpose of computing the overtime rate of compensation required 

to be paid to a nonexempt full-time salaried employee, the employee’s 

regular hourly rate shall be 1/40th of the employee’s weekly salary. 

52. California Labor Code § 1194(a) provides, 

Notwithstanding any agreement to work for a lesser wage, any employee 

receiving less than the legal minimum wage or the legal overtime 

compensation applicable to the employee is entitled to recover in a civil 

action the unpaid balance of the full amount of his minimum wage or 

overtime compensation, including interest thereon, reasonable attorney’s 

fees, and costs of suit. 

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53. At all material times set forth herein, Plaintiff and all members of the 

California Class and all aggrieved employees consistently worked in excess of eight 

hours in one workday and/or 40 hours in any one workweek; however, the proper 

overtime compensation was not paid by Defendants. 

54. Therefore, Plaintiff and all members of the California Class are entitled to 

recover unpaid overtime compensation pursuant to California Labor Code § 510(a) at 

the rate specified in California Labor Code § 515(d), plus interest, costs, and attorneys’ 

fees.

55. Pursuant to California Labor Code § 2699(f) and (g), Plaintiff and all 

members of the California Class and all aggrieved employees are further entitled to 

recover civil penalties in the amount of one hundred dollars ($100) for each aggrieved 

employee per pay period for the initial violation and two hundred dollars ($200) for 

each aggrieved employee per pay period for each subsequent violation, plus costs and 

attorney’s fees.

56. Defendants have been guilty of oppression, fraud, or malice, and should 

be punished for the sake of example. Therefore, Plaintiff and all members of the 

California Class and all aggrieved employees are entitled to punitive damages.

THIRD CAUSE OF ACTION

Willful Violation of California Labor Code § 226(a) 

(Against all Defendants) 

(For the California Class) 

57. Plaintiff incorporates by reference and realleges as if fully stated herein 

the allegations set out in paragraphs 1 through 56 of this Complaint. 

58. California Labor Code § 226(a) provides that every employer shall, 

semimonthly or at the time of each payment of wages, furnish each employee, either as 

a detachable part of the check, draft, or voucher paying the employee’s wages, or 

separately when wages are paid by personal check or cash, an accurate itemized 

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statement in writing showing (i) gross wages earned; (ii) total hours worked by the 

employee, except for an employee whose compensation is based solely on a salary and 

who is exempt from the payment of overtime; (iii) the number of piece rate units 

earned and any applicable piece rate if the employee is paid on a piece rate basis; (iv) 

all deductions; (v) net wages earned; (vi) the inclusive dates of the period for which the 

employee is paid; (vii) the name of the employee and his or her social security number; 

(viii) the name and address of the legal entity that is the employer; and (ix) all 

applicable hourly rates in effect during the pay period and the corresponding number 

of hours worked at each hourly rate by the employee. 

59. At all material times set forth herein, Defendants either recklessly or 

intentionally failed to make, keep and preserve true, accurate, and complete records of, 

among other things, the actual number of hours worked each workday and each 

workweek by Plaintiff and all members of the California Class and all aggrieved 

employees. 

60. Plaintiff is informed and believes, and thereon alleges, that Defendants 

systematically and intentionally under-reported the number of hours worked by 

Plaintiff and all members of the California Class and all aggrieved employees, 

resulting in widespread under-compensation for labor performed by Plaintiff and all 

members of the Classes and all aggrieved employees. 

61. Plaintiff is informed and believes, and thereon alleges, that Defendants 

systematically and intentionally caused a wage rate to be represented on the employee 

check stubs that did not correspond with the actual wage rate used to calculate 

employee compensation. 

62. Plaintiff is informed and believes, and thereon alleges, that Defendants 

systematically and intentionally engaged in conduct designed to conceal the underreporting of hours and the incorrect wage reporting from Plaintiff and all members of 

the California Class and all aggrieved employees. 

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63. Defendants’ conduct as alleged herein is in violation of California Labor 

Code § 226(a). 

64. Plaintiff and all members of the California Class are entitled to recover 

from Defendants the greater of their actual monetary damages caused by Defendants’ 

failure to comply with California Labor Code § 226(a), or an aggregate penalty not 

exceeding four thousand dollars ($4,000.00), injunctive relief pursuant to California 

Labor Code § 226(g) and an award of costs and reasonable attorney’s fees pursuant to 

California Labor Code § 226(e) and (g).

65. Pursuant to California Labor Code § 2699(f) and (g), Plaintiff and all 

members of the California Class and all aggrieved employees are further entitled to 

recover civil penalties in the amount of one hundred dollars ($100) for each aggrieved 

employee per pay period for the initial violation and two hundred dollars ($200) for 

each aggrieved employee per pay period for each subsequent violation, plus costs and 

attorney’s fees.

66. Defendants have been guilty of oppression, fraud, or malice, and should 

be punished for the sake of example. Therefore, Plaintiff and all members of the 

California Class and all aggrieved employees are entitled to punitive damages.

FOURTH CAUSE OF ACTION

Violation of California Labor Code §226.7(a) 

(Against all Defendants) 

(For the California Class) 

67. Plaintiff incorporates by reference and realleges as if fully stated herein 

the allegations set out in paragraphs 1 through 66 of this Complaint. 

68. The applicable IWC Wage Order and California Labor Code § 226.7(a) 

provide that employees cannot be required to work in excess of four hours without 

receiving a ten minute rest period, nor can they be required to work in excess of five 

hours without receiving a meal period of not less than 30 minutes. 

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69. At all material times set forth herein, Defendants required Plaintiff and all 

members of the California Class and all aggrieved employees to work in excess of four 

hours without providing a ten minute rest period. 

70. At all material times set forth herein, Defendants required Plaintiff and all 

members of the California Class and all aggrieved employees to work an additional 

four hours without providing a second ten minute rest period. 

71. At all material times set forth herein, Defendants required Plaintiff and all 

members of the California Class and all aggrieved employees to work for periods 

longer than five hours without a meal period of not less than 30 minutes. 

72. At all material times set forth herein, Defendants required Plaintiff and all 

members of the California Class and all aggrieved employees to work during meal 

periods and failed to compensate Plaintiff and all members of the Classes and all 

aggrieved employees for work performed during meal periods. 

73. At all material times set forth herein, Defendants required Plaintiff and all 

members of the California Class and all aggrieved employees to work during rest 

periods and failed to compensate Plaintiff and all members of the Classes and all 

aggrieved employees for work performed during rest periods. 

74. Defendants’ conduct violates the applicable IWC Wage Order, therefore 

violating California Labor Code 226.7(a). 

75. Plaintiff and all members of the California Class are entitled to recover 

from Defendants one hour compensation per missed meal break and/or rest period as 

premium pay, and not as a penalty. 

76. Pursuant to California Labor Code § 2699(f) and (g), Plaintiff and all 

members of the California Class and all aggrieved employees are further entitled to 

recover civil penalties in the amount of one hundred dollars ($100) for each aggrieved 

employee per pay period for the initial violation and two hundred dollars ($200) for 

each aggrieved employee per pay period for each subsequent violation, plus costs and 

attorney’s fees. 

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77. Defendants have been guilty of oppression, fraud, or malice, and should 

be punished for the sake of example. Therefore, Plaintiff and all members of the 

California Class and all aggrieved employees are entitled to punitive damages. 

FIFTH CAUSE OF ACTION

Violation of California Labor Code §§ 221, 400-410, 2802 and 8 C.C.R. § 11040 

 (Against All Defendants) 

(For the California Class) 

78. Plaintiff incorporates by reference and realleges as if fully stated herein 

the material allegations set out in paragraphs 1 through 77 of this Complaint. 

79. California Labor Code § 221 provides that it shall be unlawful for any 

employer to collect or receive from an employee any part of wages previously paid by 

the employer to the employee. 

80. California Labor Code § 2802(a) provides, 

 An employer shall indemnify his or her employee for all necessary 

expenditures or losses incurred by the employee in direct consequence of 

the discharge of his or her duties, or of his or her obedience to the 

directions of the employer, even though unlawful, unless the employee, at 

the time of obeying the directions, believed them to be unlawful. 

81. California Labor Code §§ 400-410 provide that an employer may not 

deduct from or reduce an employee’s wages for the purpose of shifting the employer’s 

ordinary costs of doing business to the employee. 

82. 8 Cal. Code Regs. § 11040(8) provides, 

 No employer shall make any deduction from the wage or require any 

reimbursement from an employee for any cash shortage, breakage, or loss 

of equipment, unless it can be shown that the shortage, breakage, or loss is 

caused by a dishonest or willful act, or by the gross negligence of the 

employee. 

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83. At all material times set forth herein, Defendants required Plaintiff and all 

members of the California Class and all aggrieved employees to contribute to 

Defendants’ costs of doing business, including, but not limited to compensating 

Defendants’ other employees (i.e. Sales Assistants) for the labor necessary to complete 

the work; incurring expenses (including, but not limited to, marketing, travel, 

overhead, office supplies and other expenses that are the employer’s costs of doing 

business) in direct consequence of the discharge of the duties of Plaintiff and all 

members of the California Class and all aggrieved employees, or of their obedience to 

Defendants’ directions, which expenses have not yet been reimbursed by Defendants; 

and being charged back commissions and/or the actual value of the stock losses 

allegedly caused by Plaintiff and all members of the California Class and all aggrieved 

employees as a result of their simple negligence or through no fault of their own. 

84. Thus, at all material times set forth herein, Plaintiff and all members of 

the California Class and all aggrieved employees were forced to contribute to the 

capital and expenses of Defendants’ businesses, which constitutes putting up a cash 

bond and must be refunded by Defendants to Plaintiff and all members of the 

California Class and all aggrieved employees. 

85. California Labor Code § 218.6 provides for interest specified in California 

Civil Code § 3289(b), accruing from the date that the wages were due and payable. 

86. Therefore, Plaintiff demands reimbursement for those chargebacks 

deducted by Defendants against the wages of Plaintiff and all members of the 

California Class; and reimbursement for the expenditures or losses incurred by 

Plaintiff and all members of the California Class in direct consequence of the discharge 

of their duties, or of their obedience to Defendants’ directions; plus return of all cash 

bonds or other coerced investments in Defendants’ businesses, with interest at the 

statutory rate, and attorneys fees. 

87. Pursuant to California Labor Code § 2699(f) and (g), Plaintiff and all 

members of the California Class and all aggrieved employees are further entitled to 

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recover civil penalties in the amount of one hundred dollars ($100) for each aggrieved 

employee per pay period for the initial violation and two hundred dollars ($200) for 

each aggrieved employee per pay period for each subsequent violation, plus costs and 

attorney’s fees. 

88. Defendants have been guilty of oppression, fraud, or malice, and should 

be punished for the sake of example. Therefore, Plaintiff and all members of the 

California Class and all aggrieved employees are entitled to punitive damages. 

SIXTH CAUSE OF ACTION

Violation of California Labor Code §§ 201 and 202 

(Against all Defendants) 

(For the California Class)

89. Plaintiff incorporates by reference and realleges as if fully stated herein 

the allegations set out in paragraphs 1 through 88 of this Complaint. 

90. California Labor Code §§ 201 and 202 provide that if an employer 

discharges an employee, the wages earned and unpaid at the time of discharge are due 

and payable immediately, and if an employee quits his or her employment, his or her 

wages shall become due and payable not later than 72 hours thereafter, unless the 

employee has given 72 hours previous notice of his or her intention to quit, in which 

case the employee is entitled to his or her wages at the time of quitting.

91. After the resignation or discharge of Plaintiff, the members of the 

California Class and the aggrieved employees, Defendants did not pay earned wages 

within the required time frames in the California Labor Code. Indeed, Defendants still 

have not yet paid all earned and unpaid wages of Plaintiff and all members of the 

California Class and all aggrieved employees to this day. 

92. Defendants’ failure to promptly pay wages earned and unpaid at the time 

of discharge or resignation violated California Labor Code §§ 201 or 202. 

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93. California Labor Code § 203 provides that if an employer willfully fails to 

pay, without abatement or reduction, in accordance with sections 201 and 202, any 

wages of the employee shall continue as a penalty from the due date thereof at the 

same rate until paid or until an action therefore is commenced; but the wages shall not 

continue for more than 30 days. 

94. Therefore, Plaintiff and all members of the California Class are entitled to 

recover from Defendants the statutory penalty for each day Plaintiff and all members 

of the California Class and all aggrieved employees were not paid at their regular rate 

of pay up to a 30 day maximum pursuant to California Labor Code § 203. 

95. Pursuant to California Labor Code § 2699(f) and (g), Plaintiff and all 

members of the California Class and all aggrieved employees are further entitled to 

recover civil penalties in the amount of one hundred dollars ($100) for each aggrieved 

employee per pay period for the initial violation and two hundred dollars ($200) for 

each aggrieved employee per pay period for each subsequent violation, plus costs and 

attorney’s fees. 

96. Defendants have been guilty of oppression, fraud, or malice, and should 

be punished for the sake of example. Therefore, Plaintiff and all members of the 

California Class and all aggrieved employees are entitled to punitive damages. 

SEVENTH CAUSE OF ACTION

Violation of California Business & Professions Code § 17200, et seq.

(Against all Defendants) 

(For the California Class) 

97. Plaintiff incorporates by reference and realleges as if fully stated herein 

the material allegations set out in paragraphs 1 through 96 of this Complaint. 

98. At all material times set forth herein, Defendants’ conduct was unfair, 

unlawful, and harmful to Plaintiff and all members of the California Class. 

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99. Pursuant to California Business & Professions Code § 17200, et seq., 

Plaintiff and all members of the California Class are entitled to restitution of the wages 

withheld, deducted and/or retained by Defendants, and, losses and/or expenses 

unreimbursed or charged by Defendants during a period that commences four years 

prior to the filing of this Complaint; a permanent injunction requiring Defendants to 

pay all outstanding monies due to Plaintiff and all members of the California Class; an 

award of attorneys’ fees and costs. 

100. Defendants have been guilty of oppression, fraud, or malice, and should 

be punished for the sake of example. Therefore, Plaintiff and all members of the 

California Classes are entitled to punitive damages. 

REQUEST FOR JURY TRIAL

Plaintiff requests a trial by jury. 

PRAYER FOR RELIEF

 Plaintiff prays for relief and judgment against Defendants, jointly and severally, 

as follows: 

As to the First Cause of Action

1. For general unpaid wages at overtime wage rates;

2. For an additional equal amount as liquidated damages;

3. For additional liquidated damages for unreasonably delayed payment of 

wages;

4. For pre-judgment interest on any unpaid overtime compensation from the 

date such amounts were due; 

5. For reasonable attorney’s fees and for costs of suit incurred herein 

pursuant to 29 U.S.C. § 216(b);

6. For punitive damages; and, 

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7. For such other and further relief as the Court may deem appropriate. 

As to the Second Cause of Action

8. For general unpaid wages at overtime wage rates;

9. For pre-judgment interest on any unpaid overtime compensation from the 

date such amounts were due; 

10. For reasonable attorney’s fees and for costs of suit incurred herein 

pursuant to California Labor Code § 1194(a);

11. For civil penalties, pursuant to California Labor Code § 2699(f) and (g); 

12. For punitive damages; and, 

13. For such other and further relief as the Court may deem appropriate. 

As to the Third Cause of Action

14. For all actual damages, according to proof; 

15. For statutory penalties pursuant to California Labor Code § 226(e); 

16. For injunctive relief pursuant to California Labor Code § 226(g); 

17. For reasonable costs and attorney’s fees pursuant to California Labor 

Code § 226(e);

18. For civil penalties, pursuant to California Labor Code § 2699(f) and (g); 

19. For punitive damages; and, 

20. For such other and further relief as the Court may deem appropriate. 

As to the Fourth Cause of Action

21. For payments pursuant to California Labor Code § 226.7(b); 

22. For reasonable attorney’s fees; 

23. For costs of suit incurred herein; 

24. For civil penalties, pursuant to California Labor Code § 2699(f) and (g); 

25. For punitive damages; and, 

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26. For such other and further relief as the Court may deem appropriate. 

As to the Fifth Cause of Action

27. For unpaid wages;

28. For interest on all due and unpaid wages, accrued from the date that the 

wages were due and payable, at the rate of interest specified in California Civil Code § 

3289(b), pursuant to California Labor Code § 218.6; 

29. For reasonable attorney’s fees; 

30. For costs of suit incurred herein; 

31. For civil penalties, pursuant to California Labor Code § 2699(f) and (g); 

32. For punitive damages; and, 

33. For such other and further relief as the Court may deem appropriate. 

As to the Sixth Cause of Action

34. For statutory penalties pursuant to California Labor Code § 203; 

35. For reasonable attorney’s fees; 

36. For costs of suit incurred herein; 

37. For civil penalties, pursuant to California Labor Code § 2699(f) and (g); 

38. For punitive damages; and, 

39. For such other and further relief as the Court may deem appropriate. 

As to the Seventh Cause of Action

40. For restitution of unpaid wages, wrongful deductions, unreimbursed 

expenses and pre-judgment interest thereon; 

41. For a permanent injunction ordering Defendants to pay required overtime 

rates for overtime hours worked to all securities brokers and broker trainees and 

ordering Defendants to discontinue the practice of passing on the costs of Defendants’ 

doing business to its securities brokers and broker trainees; 

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42. For the appointment of a receiver to receive, manage, and distribute any 

and all funds disgorged from the Defendants determined to have been wrongfully 

acquired by the Defendants as a result of violations of California Business & 

Professions Code § 17200 et seq.;

43. For reasonable attorney’s fees; 

44. For costs of suit incurred herein; 

45. For punitive damages; and, 

46. For such other and further relief as the Court may deem appropriate. 

Dated: , 2008 Initiative Legal Group LLP 

By: ______________________________

Mark Yablonovich 

Marc Primo 

Joseph Cho 

Gregory Yu 

Attorneys for Plaintiff

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