N O T FO R PUB L ICAT IO N UNITED STATES C OUR T OF APPEALS FOR THE NINTH C IR C UIT
ANGELA C R

UZ; e t a l., Pla i ntiffs-Appe lla

nts,
v. M M 879, INC ., a

c orporation, De fe nda n t,
and THE SER VIC EM A STER C O M PANY, LLC ; e t a l., De fe nda

n ts-Appe lle e s. No. 21-15974 D.C . No. 1:15-c v-01563-TLN-EPG
M EM O R ANDUM *

Appe a l from

the Unite d

Stat e s Distric t C ourt for the Ea ste rn Distric t of C a lifornia Troy L. Nunle y , Distric t Judge , Pre siding Argue d a nd Subm itte d M ay

12, 2022 San Fran c isc o , C a lifornia B e fore : WALLAC E , W . FLETC HER , a nd SANC HEZ, C irc uit Judge s. 

# FIL ED JUN 2 2022 M OLLY C. DW Y E R, CLERK U. S. CO URT O F APPEALS

* This disposition is not a ppropria te for public at ion a

nd is not pre c e de nt e xc e pt a s provide d

by Ninth C irc uit R

ule 36-3.Ange la C ruz , M aria

M a driga l , Lourde s B a iz , a nd C hristie Goodm an (c olle c tive ly , “ Pla intiffs” ) a ppe a l from

the distric t c ourt’ s orde rs gra nting sum m ary judgm e nt to two se ts of de fe nda nts: (1) thegroup c o nsisting of The Se rvic e M a ste r C om pa ny , LLC ; M e rry

M a ids, LP; a

nd M M M a ids, LLC (c olle c t ive ly , “ M e rry M a i ds De fe nda

nts” ); a nd (2) B arre tt B usine ss Se rvic e s, Inc . (“ B B SI” ). Pla intiffs we re form e rly

e m ploy e d a s hom e c le ane rs by M M 879, Inc . (“ M M 879” ). Ac c ording to the

M e rry M a ids De fe nda

nts’ undispute d

sta t e m e nt of fa c ts, M M 879 is “ an inde pe nde ntly owne d . . . M e rry

M a ids fra

n c hise e ba se d in Fre sno
and Lodi, C a l ifornia

pursua nt to a writte n Franc hise Agre e m e nt with M e rry M a i ds[,] LP.” M M 879 c ontra c te d with B B SI, “ a profe ssiona l e m

ploy m e nt orga niz ation,” to m ana ge its e m ploy e e s’ pa

yroll, be ne fits, hum an

re sourc e s, a

nd
m ore . In a

puta tive c la ss a c tion suit, Pla

intiffs a lle ge d tha

t M M 879’ s wa ge and hour pra c tic e s viola

te d C a lifornia

la w. Pla intiffs a lso a lle ge d tha t the y we re jointly
e m ploy e d by both theM e rry

M a ids De fe nda

nts a nd B B SI, a s we ll a s by M M 879. The distric t c ourt first gra nte d sum m ary judgm e nt to theM e rry

M a ids De fe nda

nts. It de nie d Pla intiffs’ m otion for re c onside ra tion of tha t orde r. In a subse que nt orde r, the distric t c ourt the n gra nte d sum m ary judgm e nt to B B SI. The distric t
c ourt he ld tha

t the re wa s no tria

ble issue of fa c t a s to whe the r e ithe r the M e rry

2M a i ds De fe nda nts or B B SI wa s a

joint e m ploy e r of Pla i ntiffs. Furthe r, the distric t
c ourt he ld a s a m atte r of la w tha t the oste nsible a ge n c y

the ory did not a p ply to C a lifornia W a ge Orde r 5-2001. W e have jurisdic tion pursua nt to 28 U.S.C . § 1291. “ W e re vie w a grant of
sum m ary judgm e nt de novo.” Gre nning v . Mille r-Stout , 739 F.3d 1235, 1238 (9th C ir. 2014). W e a ffirm

the distric t c ourt’ s grant of sum m ary judgm e nt to theM e rry M a i ds De fe nda

nts, but we re v e rse the distric t c ourt’ s gra nt of sum m ary judgm e nt to B B SI. W e re m and for furthe r proc e e dings. 1. Unde r C a lifornia

la w, a de fe nda nt is a joint e m ploy e r if it “ (a ) . . .
e xe rc ise [s] c ontrol ove r the wa g e s, hours[,] or working c onditions [of em ploy e e s;]
or (b) . . . suffe r[s] or pe rm it[s e m ploy e e s ] to work[;] or

(c ) . . . e nga ge [s] [e m ploy e e s] , the re by

c re at ing a

c om m on la w e m ploy m e nt re l ationship.” Martine z
v . C ombs , 231 P.3d 259, 278 (C a l. 2010). Pla i ntiffs ha ve not e sta

blishe d a ge nuine disputeof m ate ria l fa c t whe t he r the M e rry

M a ids De fe nda

nts qua lifie d a s a

n
e m ploy e r unde r any

of the se t hre e prongs of Martine

z v . C ombs , 231 P.3d 259. The re is no ge n

uine disputea

bout whe the r the M e rry

M a ids De fe nda

nts
e xe rc ise d, or ha d the right to e xe rc ise , c ontrol ove r Pla intiffs’ wa ge s, hours, or working c onditions. Tha t the Franc hise Agre e m e nt dire c te d M M 879 to c onduc t its busine ss in a c c orda

nc e with writte n m ate ria l s provide d by the M e rry

M a ids
3De fe nda

nts is insuffic ie nt to c re ate suc h a dispute . Furthe r, M M 879's c o-owne r te stifie d tha

t he wa s sole ly

re s ponsiblefor im

ple m e nting M M 879's wa ge and hour pra c tic e s, a

nd tha t he wa s not re quire d

to c om ply with theM e rry M a ids De fe nda nts’ sugge ste d proc e dure s. Sim ila rly , the M e rry

M a ids De fe nda

nts did not
e sta blish a c om

m on la w e m ploy m e nt re lat ionship with Pla intiffs. As fra

nc hisors, the y did not sa

tisfy the “ princ ipa l te st of a n e m ploy m e nt re lationship”unde r the
c om m on la w: “ whe t he r the pe rson to whom

se rvic e is re nde re d

ha s the right to
c ontrol them anne r and m e ans of a c c om plishing the

re sult de s ire d.” S.G. Bore llo & Sons, Inc . v . De

p’t of Indus. Re ls. , 769 P.2d 399, 404 (C a l. 1989). 2. The distric t c ourt e rre d in c onc luding a s a m atte r of la

w tha t B B SI is not a joint e m ploy e r unde r Martine

z . To e va luate the third Martine z te st for joint
e m ploy m e nt— whe t he r a c om m on la w e m ploy m e nt re lationship wa s
e sta blishe d— we a pply the C a lifornia

Supre m e C ourt’ s a

n a ly sis in A

y a la v

. Ante lopeValle

y N e w s pape rs , 327 P.3d 165 (C a l. 2014). 1 Tha t C ourt wrote :

“ Pe rha ps the stronge s t e v ide nc e of the right to c ontrol is whe the r the hire r c an

1 The distric t c ourt c onc lude d tha t Ay ala is irre le va

n t to theinsta

nt c a se be c a use “ Ay ala involve d

a disputeove r whe the r ne wspa pe r c arrie rs we re inde pe nde nt c ontra c tors or e m ploy e e s” and “ did not discuss joint em p loy m e nt or the M artine z te st.” Se e Ay ala , 327 P.3d a t 170–71. B ut M

artine z inc orporate d the c om m on la w e m ploy m e nt re lationship a s one of the te sts for whe t he r a de fe nda nt is a joint e m ploy e r. Martine

z , 231 P.3d a

t 278. B e c a

use Ay ala e xpla ins the princ ipa l te st of a

n e m ploy m e nt re lationship unde

r c o m m on la w , it is c le arly re le va nt to theissue he re . Se e 327 P.3d a t 171. 4disc ha

rge the worke r without c a use , be c a use ‘ [t] h e powe r of the princ ipa l to te rm inate the se rvic e s of the a ge nt give s him the m e ans of c ontrolling the a ge nt’ s
a c tivitie s.’ ” Id. at 171 (a lte ra tion in origina l ) (quoting Malloy

v . Fong , 232 P.3d 241, 249 (C a l. 1951)). “ [W ] hat m atte rs unde r the c om m o n la w is not how m

uc h
c ontrol a hire r e x e rc ise s , but how m

uc h c ontrol the hire r re ta i ns the r ight to
e xe rc ise .” Id. at 172. Othe r fa c tors, inc luding those re c ite d in Futre ll v . Pay day C alifornia, Inc

. , 119 C a l. R ptr. 3d 513, 526 (C a l. C t. App 2010), upon whic h the distric t c o urt re lie d, a

re “ se c onda

ry indic ia .” Ay ala , 327 P.3d a t 171. Pla intiffs ha

ve pre se nte d e vide nc e tha t B B SI re t a ine d the right to te rm inate M M 879 e m

p loy e e s with or without c a u s e , e v e n if it did not exe rc ise that right. For e xam ple , the Applic ation for C o-Em ploy m e n t for M M 879 e m

ploy e e s sta

te d:

“ Em ploy m e nt a t y our W orksite Em

ploy e r and B arre tt B usine ss Se rvic e s, Inc
. (B B SI) is ‘ A T-W ILL.’ The e m ploy m e nt re lationship may

be te rm i nate d for any
re a s on with or without c a u se or notic e at a

ny tim e by y o u or e i the r

C ompany .” (Em pha s is a dde d.) Furthe r, B B SI’ s Pe rson M ost Knowle d ge a ble te stifie d tha

t B B SI re ta ine d “ the right . . . to term inate the e m ploy m e nt, with or without c a

use , of a worke r for a

M e rry M a ids fra

nc hise in C a lifornia .” Sim ila rly , the Agre e m e nt for Em ploy e r and Sta ffing Se rvic e s be twe e n B B SI and M M 879 sta te d tha t B B SI

“ sha ll ha ve the right to hire , disc ipline , an d te rm inate [e ] m ploy e e s.” The

5Applic at ion for C o-Em ploy m e n t de sc ribe d se v e ra l offe nse s tha t c ould m e rit disc ipline or te rm ination by B B SI. Fina lly , in the Em ploy e e Ha

ndbook for M M 879 e m ploy e e s, B B SI is una

m b iguously c h ara c te riz e d a s a

joint e m ploy e r. Suc h
c ha ra c te riz ation, sta

nding a lone , is not ne c e ssa rily e nough to c re at e an e m

ploy m e nt
re lationship, but it is e

vide nc e o f suc h a

re l ationship. Unde r Ay ala , the distric t c ourt the re fore e rre d in c onc luding a s a m atte r of la w tha t B B SI did not e s ta

blish a c om m o n la w e m ploy m e nt re lationship with Pla i ntiffs. W e re ve rse the distric t c ourt’ s gra nt of sum m ary judgm e nt to B B SI. 3. W e de c l ine to c e rtify

to the C a lifornia

Supre m e C ourt the que stion whe the r the oste n sible a g e nc y the ory a p plie s to thede finition of e m ploy e r in C a lifornia W a ge Orde r 5-2001. AFFIRM E D in par t, RE V E RSE D in par t, and RE M ANDE D.

6