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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

CHARLES RIDGEWAY, et al.,

Plaintiffs,

v.

WAL-MART STORES, INC.,

Defendant.

Case No. 08-cv-05221-SI 

ORDER:

-- GRANTING IN PART AND DENYING 

IN PART DEFENDANT’S MOTION TO 

DISMISS;

-- DENYING DEFENDANT’S MOTION 

FOR SUMMARY JUDGMENT AND 

GRANTING PLAINTIFFS’ MOTION 

FOR SUMMARY JUDGMENT;

--DENYING DEFENDANT’S MOTION 

TO DECERTIFY THE CLASS; AND

--GRANTING DEFENDANT’S MOTION 

TO SEAL

Re: Dkt. Nos. 321, 324, 325, 346

Defendant Wal-Mart Stores, Inc. (“Wal-Mart”) has filed a motion to dismiss, a motion for 

summary judgment, and a motion to decertify the class. Dkt. Nos. 321, 324, 325. This matter 

came on for hearing on August 12, 2016. For the reasons set forth below, the Court rules as 

follows.

BACKGROUND

Plaintiffs are truck drivers in California previously employed by defendant Wal-Mart for 

some period of time between 1993 and the present. Dkt. No. 72, Fourth Am. Compl. ¶¶ 3-6. 

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Plaintiffs allege Wal-Mart violated California law by failing to pay plaintiffs at least the minimum 

wage for each hour worked. 

The facts and procedural history of this case are summarized in numerous prior orders of 

the Court. See, e.g., Dkt. No. 211. In September 2014, the Court granted in part and denied in 

part plaintiffs’ motion for class certification. Dkt. No. 158. On May 28, 2015, the Court granted 

plaintiffs’ motion for summary judgment on their seventh cause of action (minimum wage claims 

pursuant to the Industrial Welfare Commission (“IWC”) orders). Dkt. Nos. 181, 211. The Court 

denied plaintiffs’ motion as to Wal-Mart’s eighth affirmative defense. On April 25, 2016, the 

Court granted plaintiffs’ motion for partial summary judgment on their fourth cause of action, 

violation of the Unfair Competition Law (“UCL”), California Business and Professions Code 

sections 17200 et seq. Dkt. Nos. 255, 286. 

In June 2016, the Court denied Wal-Mart’s motion to stay the case pending the appeal of 

Ortega v. J.B. Hunt Transport, Inc., No. 14-56034 (9th Cir.). Dkt. No. 313. Shortly thereafter, 

the parties informed the Court that Wal-Mart had recently identified forty-two additional class 

members who were inadvertently not included in the previous class list. Upon plaintiffs’ motion, 

the Court issued an order directing issuance of supplemental class notice and making schedule 

adjustments. Dkt. No. 320. The dispositive motion deadline of July 8, 2016, remained in place. 

Id. at 3. 

On July 8, 2016, Wal-Mart filed the following motions: (1) a motion to dismiss the claims 

of named plaintiffs Nino Pagtama and Michael Krohn and the claims of class members Steve 

Williams, Mark Taylor, Vance Eason, and Kevin Putnam, Dkt. No. 321 (“Mot. to Dismiss”); (2) a 

motion for summary judgment, Dkt. No. 324 (“Def.’s Mot. for Summ. J.”); and (3) a motion to 

decertify the class, Dkt. No. 325 (“Mot. to Decert.”). Trial is currently set for October 5, 2016. 

DISCUSSION

I. Motion to Dismiss

A. Named Plaintiffs Pagtama and Krohn

Defendant moves to dismiss named plaintiffs Nino Pagtama and Michael Krohn based on 

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Federal Rules of Civil Procedure 37(b) and 41(b). Mot. to Dismiss at 4. According to defendant, 

Pagtama and Krohn have each twice failed to appear for scheduled depositions, have not provided 

verified responses to written discovery or initial disclosures, and did not join in plaintiffs’ motions 

for summary judgment or class certification. Id. 

1. Legal Standard

The Ninth Circuit has set forth the test for analyzing whether to dismiss a claim for failure 

to prosecute: 

[T]he Court must weigh the following factors: (1) the public's interest in 

expeditious resolution of litigation; (2) the court's need to manage its docket; (3) 

the risk of prejudice to defendants/respondents; (4) the availability of less drastic 

alternatives; and (5) the public policy favoring disposition of cases on their merits.

Pagtalunan v. Galaza, 291 F.3d 639, 642 (9th Cir. 2002) (citing Ferdik v. Bonzelet, 963 F.2d 

1258, 1260-61 (9th Cir. 1992)). The Ninth Circuit reasoned, “[t]he first two of these factors favor 

the imposition of sanctions in most cases, while the fourth cuts against a default or dismissal 

sanction. Thus the key factors are prejudice and availability of lesser sanctions.” Wanderer v. 

Johnston, 910 F.2d 652, 656 (9th Cir. 1990).

The court must consider alternatives to dismissal. Malone v. U.S. Postal Serv., 833 F.2d 

128, 131-32 (9th Cir. 1987) (citing United States v. Nat’l Med. Enters., Inc., 792 F.2d 906, 912 

(9th Cir. 1986)). In determining whether the court has considered alternatives, the following 

factors are relevant:

(1) Did the court explicitly discuss the feasibility of less drastic sanctions and 

explain why alternative sanctions would be inadequate? (2) Did the court 

implement alternative methods of sanctioning or curing the malfeasance before 

ordering dismissal? (3) Did the court warn the plaintiff of the possibility of 

dismissal before actually ordering dismissal? 

Id. at 132. 

2. Named Plaintiff Krohn

Defendant asserts that Krohn failed to prosecute his claims and did not comply with 

discovery obligations, including twice failing to appear for scheduled deposition. Mot. to Dismiss 

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at 4. According to counsel for defendant, the day before Krohn’s deposition, plaintiffs’ counsel 

“informed our firm that Mr. Krohn would not be appearing for his deposition.” Dkt. No. 322, 

Cripps Decl. ¶ 4. After rescheduling the deposition for the following week, plaintiffs’ counsel 

informed defendant’s counsel the day before the deposition “that they had made repeated attempts 

to contact Mr. Krohn about his deposition but he had not returned any of the phone calls . . . .” Id. 

Defendant further states that plaintiffs’ counsel “stated that counsel for Plaintiffs would not 

oppose dismissal of Mr. Krohn from this action.” Id. 

In their opposition, plaintiffs dispute this last assertion. Counsel for plaintiffs states, “I 

told defense counsel, Jesse Cripps, that Plaintiffs would stipulate to have named class 

representatives, Nino Pagtama and Michael Krohn, dismissed as class representatives but to 

remain as class members.” Dkt. No. 337-1, Wagner Decl. ¶ 4. Plaintiffs argue that defendant has 

not shown sufficient evidence that it would be prejudiced by keeping Krohn on as a class member. 

Plaintiffs assert, “Were [he] not [a] class representative[], [he] would not have been noticed for 

depositions so there is no prejudice . . . .” Dkt. No. 337 (“Pls.’ Opp’n to Mot. to Dismiss”) at 4. 

The Court disagrees with plaintiffs that there is no prejudice, when defendant has been 

unable to depose a named plaintiff before the discovery deadline of July 7, 2016. See Dkt. No. 

242 at 1. Plaintiffs’ counsel filed a declaration stating that counsel had contacted Krohn and he 

stated that “he did not attend his deposition because he has a PTSD disability and is unable to 

withstand the deposition process.” Dkt. No. 337-1, Wagner Decl. ¶ 6. However, counsel has filed 

nothing from Krohn directly. When questioned at the hearing about whether there was some way 

to make Krohn available for deposition while accommodating his disability, the parties agreed to 

meet and confer regarding this matter. The Court has heard nothing further.

Even if Krohn were to continue as a class member rather than as a named plaintiff, it 

would still be within Wal-Mart’s rights to seek his deposition. At this time, the Court will not 

grant Wal-Mart’s motion to dismiss Krohn from the lawsuit, but Wal-Mart may again move for 

his dismissal if he continues to fail to meet his discovery obligations. The parties are ORDERED 

to meet and confer regarding Krohn’s deposition and to file an update with the Court no later 

than September 2, 2016. If Krohn’s deposition will proceed, plaintiffs are ORDERED to provide 

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Krohn’s disclosures under Rule 26 and his responses to the written discovery that has been served, 

see Mot. to Dismiss at 2, no later than one week in advance of the deposition. 

3. Named Plaintiff Pagtama

In addition to the above reasons for requesting dismissal of named plaintiff Krohn, 

defendant states that “[d]ismissal of Pagtama is particularly appropriate because he has 

affirmatively and expressly made clear his intent to exclude himself from the class.” Mot. to 

Dismiss at 6. Defendant attaches an exclusion postcard signed by Pagtama and postmarked

February 23, 2015. Dkt. No. 322-1, Cripps Decl. Ex. A. The postcard notes, “To be effective, this 

postcard must be postmarked on or before February 27, 2015.” Id. Plaintiffs’ opposition is silent 

on Pagtama’s opt-out.

Because Pagtama affirmatively opted to exclude himself from the class prior to the 

exclusion deadline, the Court GRANTS defendant’s motion to dismiss Pagtama from the case.

B. Class Members Williams, Taylor, and Eason

Defendant next asks the Court to dismiss the claims of class members Steve Williams, 

Mark Taylor, and Vance Eason because each stated on the record during his deposition that he did

not wish to remain in the lawsuit. Mot. to Dismiss at 4. In its motion, Wal-Mart does not cite 

specific authority for its request for dismissal, but in the opposition and the reply both parties 

construe the request as one for a late opt-out under Rules 6(b)(2), 60(b)(1), and 23. See Pls.’ 

Opp’n to Mot. to Dismiss at 5-6; Dkt. No. 358 (“Def.’s Reply re: Mot. to Dismiss”) at 4.

1. Legal Standard

Under Federal Rules of Civil Procedure 6(b) and 60(b), courts have discretion to allow 

class members to opt out of proceedings after the agreed upon opt-out date. Rule 6(b) states that 

“[w]hen an act may or must be done within a specified time, the court may, for good cause, extend 

the time . . . on motion made after the time has expired if the party failed to act because of 

excusable neglect.” Fed. R. Civ. P. 6(b). Additionally, Rule 60(b) provides that “[o]n motion and 

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just terms, the court may relieve a party . . . . from a final judgment, order, or proceeding for the 

following reasons: (1) mistake, inadvertence, surprise, or excusable neglect, . . . or (6) any other 

reason that justifies relief.” Fed. R. Civ. P. 60(b).

The Supreme Court set forth the standard for determining whether neglect is “excusable” 

under Rule 60(b). Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd. P’Ship, 507 U.S. 380, 395 

(1993). “[T]he determination of whether neglect is excusable is an equitable one that depends on 

at least four factors: (1) the danger of prejudice to the opposing party; (2) the length of the delay 

and its potential impact on the proceedings; (3) the reason for the delay; and (4) whether the 

movant acted in good faith.” Bateman v. U.S. Postal Serv., 231 F.3d 1220, 1223-24 (9th Cir. 

2009) (citing Pioneer, 507 U.S. at 395). 

2. Class Members Williams and Taylor

On June 23, 2016, when asked at his deposition if he had had an opportunity to opt out of 

the lawsuit, Williams testified, “Actually, I didn’t read any of the mail that came . . . . I just pretty 

much trashed it, to be honest with you. So I didn’t realize there was an opt out or what have you.” 

Dkt. No. 322-2, Cripps Decl. Ex. B, Williams Dep. at 10:7-15. When asked, “And do you want to 

be in the lawsuit now?” Williams answered, “I really don’t care to be in the lawsuit.” Id. at 10:16-

18.

That same day, Taylor testified similarly at his deposition that he “just started getting 

things in the mail asking if [he] wanted to be a part of [the lawsuit]. And basically [he] just 

ignored them.” Dkt. No. 322-3, Cripps Decl. Ex. C, Taylor Dep. at 8:2-5. When asked, “Do you 

still wish to be a part of the lawsuit?” Taylor replied, “I never wanted to be a part of the lawsuit. I 

just kind of thought it would go away, knowing that I feel good about who I work for and am real 

happy with who I work for.” Id. at 8:8-15. 

Plaintiffs oppose the motion to dismiss Williams and Taylor, arguing that there is no 

authority for defendants to seek this late opt-out. Pls.’ Opp’n to Mot. to Dismiss at 5. The cases 

that plaintiffs cite, however, do not stand for the proposition that courts may not permit late optouts prior to settlement or trial. Officers for Justice v. Civil Serv. Comm’n of City & Cty. Of San 

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Francisco, 688 F.2d 615, 635 (9th Cir. 1982), for instance, involved a named plaintiff seeking to 

opt out of a class after the case had settled. Unlike the plaintiff in Officers for Justice, however, 

class members Williams and Taylor are not attempting to opt out after the deadline in order to 

avoid an unsatisfactory settlement agreement. See id. Although the Ninth Circuit in that case

found that due process does not “require[] that members of a Rule 23(B)(3) class be given a 

second chance to opt out,” nor did the appellate court hold that class members may never belatedly 

opt out of a class. See id. (emphasis added). Indeed, the opinion does not address the application 

of Rules 6(b) and 60(b) to late opt-outs. 

The second case cited by plaintiffs states the opposite of what plaintiffs assert. While 

plaintiffs suggest that “no authority” exists to support giving class members a second chance to 

opt out, plaintiffs also write that the Ninth Circuit in Silber concluded, “appellant also had the 

option . . . of seeking discretionary relief from the district court’s opt-out deadline.” Pls.’ Opp’n 

to Mot. to Dismiss at 6 (citing Silber v. Mabon, 957 F.2d 697, 702 (9th Cir. 1992)). Silber

therefore acknowledges that “discretionary relief from missed opt-out deadlines is available under 

Fed. R. Civ. P. 6(b)(2) and 60(b)(1) as well as generally under Rule 23.” 957 F.2d at 700 

(citations and internal quotation marks omitted).

Likewise, plaintiffs rely on a case out of the Second Circuit, Manhattan-Ward, Inc. v. 

Grinnell Corp., 490 F.2d 1183, 1186 (2d Cir. 1974) (per curiam). Citing Rules 6(b)(2) and 

60(b)(1), the court there found that “whether neglect in a particular case is excusable rests within 

the sound discretion of the district judge . . . .” Manhattan-Ward, 490 F.2d at 1186. Plaintiffs 

thus fail to cite authority which suggests that this Court may not utilize its discretion under Rules 

6(b), 60(b), and 23 to grant defendant’s motion to dismiss Williams and Taylor.

The Court finds that the Pioneer factors weigh in favor of allowing Williams and Taylor to 

opt out at this stage due to excusable neglect. There would be little danger of prejudice to 

plaintiffs, as they would be in the same position as if these two class members had timely opted 

out. See Pioneer, 507 U.S. at 395. There is no prejudice to defendant, as Wal-Mart is the party 

that is facilitating the late opt-out. Williams and Taylor’s neglect has not caused significant delay 

in the proceedings and there is no evidence that they engaged in bad faith by ignoring their mail.

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Accordingly, the Court GRANTS defendant’s motion to dismiss the claims of class 

members Williams and Taylor based on their requests to be excluded from this action.

3. Class Member Eason

During his deposition on February 25, 2016, class member Vance Eason testified that he 

wanted to opt out of this litigation. See Dkt. No. 322-4, Cripps Decl. Ex. D, Eason Dep. at 6:22-

7:5 (“Q. . . . you want to opt-out of being a class member in this litigation. A. Correct. Q. Is that 

correct? A. Correct. Q. Okay. And that if we represent to the court on your behalf that that’s 

what you want to do, that’s agreeable with you? A. Yes.”). The transcript shows that during the 

deposition both parties planned to stipulate to the Court that Eason would be withdrawn as a class 

member. Id. at 9:14-18. The Court did not receive any such stipulation.

Alongside their opposition, plaintiffs now attach a declaration from Eason, stating that he 

does not wish to opt out of the lawsuit but rather wishes to remain a class member. Dkt. No. 337-

2, Eason Decl. ¶ 3. Eason explains in his declaration, “I made statements in my deposition about 

what I thought about the case and I gave some personal opinions about the case. However, I did 

not know all the facts of the case and did not understand how the law pertained to those facts.” Id.

¶ 4. 

Given Eason’s declaration, the Court finds there is no reason under Federal Rule of Civil 

Procedure 6(b) or 60(b) to allow a late opt-out here. At the hearing, the parties represented that a 

new deposition for Eason has been set. The Court therefore DENIES defendant’s motion to 

dismiss Eason as a class member from the present litigation.

C. Class Member Putnam

Wal-Mart moves to dismiss class member Kevin Putman based on a previous lawsuit by 

Putman against Wal-Mart in an unrelated case. Mot. to Dismiss at 7-8. That case was resolved by 

a settlement that included a general release of all claims against Wal-Mart. Wal-Mart has moved 

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to file the document under seal, citing confidentiality concerns.1 Dkt. No. 346. At the hearing, 

plaintiffs’ counsel agreed that the settlement released Putnam’s claims, including the claims raised 

in this lawsuit. Following the hearing, plaintiffs filed a declaration from Putnam agreeing that the 

settlement is confidential and objecting to its being filed publicly. Dkt. No. 398. The Court 

therefore GRANTS defendant’s motion to seal Exhibit F to the declaration of Jesse Cripps. See

Dkt. Nos. 322-6, 346. The Court also GRANTS Wal-Mart’s motion to dismiss class member 

Putnam from this lawsuit. 

II. Motion for Summary Judgment

Wal-Mart has moved for summary judgment on two grounds. First, it argues that the 

Federal Aviation Administration Authorization Act (“FAAAA”) preempts California’s minimum 

wage laws. Def.’s Mot. for Summ. J. at 1. Second, it argues that even if California minimum 

wage law applies, “that law imposes on each plaintiff the burden of proving ‘[t]he amount of 

wages owed’ to him” and that the named plaintiffs have failed to present evidence of their actual 

damages. Id. Plaintiffs have filed an opposition, styled also as a cross-motion for summary 

judgment, seeking an affirmative order from the Court that the FAAAA does not preempt 

California minimum wage law. Dkt. No. 345 (“Pls.’ Opp’n to Def.’s Mot. for Summ J.”) at 1.

A. Preemption under the FAAAA

This is not the first time the Court has examined FAAAA preemption in this case. In 

February 2013, Wal-Mart moved to dismiss plaintiffs’ Third Amended Complaint in part based on 

preemption of California’s meal and rest break laws. Dkt. No. 65 at 1. In April 2013, the Court 

denied Wal-Mart’s motion as to FAAAA preemption, finding that the meal and rest break laws 

“do not ‘relate to’ motor carrier rates, routes, or services . . . .” Dkt. No. 72 at 6. Wal-Mart then 

renewed its argument in its motion to dismiss plaintiffs’ Fourth Amended Complaint. Dkt. No. 74 

 

1 Defendant previously filed a fully redacted version of the settlement agreement. Dkt. No. 

323. After the Court denied the motion to seal that document, finding the redactions to be 

overbroad, defendant re-filed a less redacted version. See Dkt. Nos. 335, 346.

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at 2, 12. The Court denied the motion as to preemption, finding that Wal-Mart had not properly 

sought leave for reconsideration. Dkt. No. 82 at 4-5.

For reasons similar to those stated in the Court’s prior orders on the motions to dismiss, 

and based on Supreme Court and Ninth Circuit case law, the Court finds that the FAAAA does not 

preempt California minimum wage law.

The FAAAA provides, in part, that “a State . . . may not enact or enforce a law, regulation, 

or other provision having the force and effect of law related to a price, route, or service of any 

motor carrier . . . with respect to the transportation of property.” 49 U.S.C. § 14501(c)(1). 

“Preemption analysis begins with the assumption that Congress does not intend to supplant state 

law. Although Congress clearly intended FAAAA to preempt some state regulations of motor 

carriers who transport property, the scope of the preemption must be tempered by the presumption 

against the pre-emption of state police power regulations.” Dilts v. Penske Logistics, LLC, 769 

F.3d 637, 642-43 (9th Cir. 2014) (quoting Tillison v. Gregoire, 424 F.3d 1093, 1098 (9th Cir. 

2005)). Preemption may occur if a state law’s effect on rates, routes, and services is indirect, but 

such effect must be more than “tenuous” or “remote.” Californians for Safe Dump Truck Transp. 

v. Mendonca, 152 F.3d 1184 (9th Cir. 1998) (“a state law dealing with matters traditionally within 

its police powers, and having no more than an indirect, remote, and tenuous effect on motor 

carriers, are not preempted.”). “Wage and hour laws constitute areas of traditional state regulation 

. . . .” Id. at 643 (citing Cal. Div. of Labor Standards Enforcement v. Dillingham Constr., N.A., 

519 U.S. 316, 330-34 (1997)).

Wal-Mart argues that the Court’s prior rulings, finding that Wal-Mart’s Driver Pay 

Manuals violate California minimum wage law by failing to pay drivers at least minimum wage 

for all of the time they worked, have forced Wal-Mart to move away from its prior “activitybased” pay system for its California truck drivers. In October 2015, Wal-Mart moved to a system 

in which it “pay[s] drivers a flat hourly rate at the applicable minimum wage for all hours on duty, 

a flat rate for rest breaks, a flat rate for meal breaks, and additional productivity pay based on their 

mileage, stops, and other activities incidental to delivering the load.” Def.’s Mot. for Summ. J. at 

7 (citing Parrish Decl. ¶ 6). It argues that this new system “decreases efficiency[] and limits driver 

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productivity . . . .” Dkt. No. 324, Notice of Mot. at 2. Because of this, Wal-Mart says, 

California’s minimum wage laws are “related to” its pricing, routes, and services and are therefore 

preempted by the FAAAA. Id. Wal-Mart states, among other things, that it had to hire at least 

five new employees to manage the new payment system it put into place in October 2015. Dkt. 

No. 324-1, Parrish Decl. ¶ 8. 

The Ninth Circuit has evaluated FAAAA preemption and its interaction with California 

wage and hour law on several occasions. In Mendonca, based on the text of the FAAAA, its 

legislative history, and Supreme Court cases interpreting the “related to” language, the Ninth 

Circuit held that the FAAAA did not preempt California’s prevailing wage law. 152 F.3d at 1189. 

Thus, a motor carrier association’s members were not exempt from complying with California law 

requiring that they pay their workers “not less than the general prevailing rate . . . for work of a 

similar character in the locality in which the public work is performed.” Id. at 1186 (quoting Cal. 

Lab. Code § 1771). 

Roughly sixteen years later, the Ninth Circuit revisited the preemption question as it 

applies to California’s meal and rest break laws in Dilts. There, the Ninth Circuit reversed a grant 

of summary judgment on FAAAA preemption grounds where a certified class of truck drivers 

sued their trucking company employer based on alleged violations of California’s meal and rest 

break laws. 769 F.3d at 640. Again, the appeals court looked to legislative history, as well as to 

Supreme Court decisions issued since the Ninth Circuit decided Mendonca and to case law 

involving the analogous Airline Deregulation Act. Having thoroughly examined the state of the 

law, the Ninth Circuit concluded that the FAAAA does not preempt California’s meal and rest 

break laws. The appeals court reasoned, in part: 

Although we have in the past confronted close cases that have required us to 

struggle with the “related to” test, and refine our principles of FAAAA preemption, 

we do not think that this is one of them. In light of the FAAAA preemption 

principles outlined above, California's meal and rest break laws plainly are not the 

sorts of laws “related to” prices, routes, or services that Congress intended to 

preempt. They do not set prices, mandate or prohibit certain routes, or tell motor 

carriers what services they may or may not provide, either directly or indirectly. 

They are “broad law[s] applying to hundreds of different industries” with no other 

“forbidden connection with prices[, routes,] and services.” Air Transp. Ass'n, 266 

F.3d at 1072. They are normal background rules for almost all employers doing 

business in the state of California. And while motor carriers may have to take into 

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account the meal and rest break requirements when allocating resources and 

scheduling routes—just as they must take into account state wage laws, Mendonca,

152 F.3d at 1189, or speed limits and weight restrictions, 49 U.S.C. 

§ 14501(c)(2)—the laws do not “bind” motor carriers to specific prices, routes, or 

services, Am. Trucking, 660 F.3d at 397. Nor do they “freeze into place” prices, 

routes, or services or “determin[e] (to a significant degree) the [prices, routes, or] 

services that motor carriers will provide,” Rowe, 552 U.S. at 372, 128 S.Ct. 989.

Dilts, 769 F.3d at 647.

Wal-Mart fails to meaningfully distinguish the Ninth Circuit’s decisions in Mendonca and 

Dilts. It argues that the minimum wage law in this case is distinct from the prevailing wage and 

meal and rest break laws that the Ninth Circuit previously considered because compliance with 

minimum wage law “requires Wal-Mart not just to brook increased costs, but to either risk 

significant liability or otherwise abandon entire pay systems that undisputedly foster productivity 

and efficiency . . . .” Dkt. No. 363 (“Reply in Support of Def.’s Mot. for Summ. J.”) at 1. 

However, the Ninth Circuit already considered and rejected similar arguments. See Dilts, 769 

F.3d at 646-47 (“Such laws are not preempted even if they raise the overall cost of doing business 

or require a carrier to re-direct or reroute some equipment. . . . Nor does a state law meet the 

‘related to’ test for FAAAA preemption just because it shifts incentives and makes it more costly 

for motor carriers to choose some routes or services relative to others . . . .”). As Justice Scalia 

observed in Dillingham, “everything is related to everything else.” 519 U.S. at 335 (Scalia, J., 

concurring). But to be “related to” for purposes of FAAAA preemption, a state law must rise to 

the level of having “more than an indirect, remote, and tenuous effect on motor carriers.” 

Mendonca, 152 F.3d at 1185. 

For that reason, the Court declines Wal-Mart’s invitation to follow the Central District of 

California’s lead in Ortega v. J.B. Hunt Transp., Inc., No. 07-cv-8336-BRO, 2014 WL 2884560 

(C.D. Cal. June 4, 2014). As this Court previously observed, that decision was issued before that 

court had the benefit of the Ninth Circuit’s guidance in Dilts. See Dkt. No. 313 at 1-2. Since 

Dilts, the same judge who previously found FAAAA preemption in Ortega has ruled in another 

case that the FAAAA did not preempt the plaintiff truck drivers’ claims under the California 

Labor Code, including minimum wage claims, in light of Dilts. See Taylor v. Shippers Transp. 

Exp., Inc., No. 13-cv-2092-BRO, 2014 WL 7499046, at *2, 8-9 (C.D. Cal. Sept. 30, 2014).

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Wal-Mart is correct that the defendants in Dilts presented little evidence in support of their 

preemption argument. Wal-Mart, by contrast, has presented declarations and expert reports to 

support its argument that changing its payment practices to comport with California minimum 

wage law would increase its costs. However, the majority of Wal-Mart’s evidence and arguments 

are premised on the assumption that Wal-Mart must abandon using an activity pay-based system, 

which is something this Court has never held. Nor is it clear from what Wal-Mart has presented 

that the new pay system it implemented in October 2015 is the only way to comply with California 

minimum wage law. It is not persuasive that Wal-Mart had to hire five new employees based on 

the new compensation system it has chosen to put into place, see Parrish Decl. ¶ 8, as the Ninth 

Circuit found a similar argument unpersuasive in Dilts. See 769 F.3d at 648 (“Motor carriers may 

have to hire additional drivers or reallocate resources in order to maintain a particular service 

level, but they remain free to provide as many (or as few) services as they wish.”). 

Wal-Mart also cites to the declaration of Billy Deatherage and the report of its expert Dr. 

Robert Topel. Def.’s Reply in Support of Mot. for Summ. J. at 3. Wal-Mart cites the declaration 

of Deatherage, a Wal-Mart Senior Strategy Manager for Fleet Optimization, as support for its 

assertion that the lost productivity from switching from an activity-based pay system “translates 

into losses of millions of dollars across Wal-Mart’s California distribution centers.” Id. (citing 

Dkt. No. 324-2, Deatherage Decl. ¶¶ 17, 19). However, Deatherage’s declaration addresses the 

impact of complying with California meal break laws and the financial impact it has had on the 

company since 2006. See Deatherage Decl. ¶¶ 16-19. Meal breaks are not at issue in the present 

motion, and the declaration is silent as to any concrete dollar impact of Wal-Mart’s post-October 

2015 pay system. Likewise, Dr. Topel’s report does not outright assert that Wal-Mart has incurred 

a 9 to 22% productivity loss from implementing a new pay system, as Wal-Mart appears to argue.

2

 

 

2

The portions of its expert report that Wal-Mart cites in its papers, to support its argument 

that a new pay system would decrease productivity and increase costs, also rely on hypothetical 

scenarios or scenarios that will not necessarily come to pass under a pay system that comports 

with California minimum wage law. See, e.g, Def.’s Mot. for Summ. J. at 15 (“Shifting to a less 

efficient system that does not foster productivity ‘might also cause [Wal-Mart] to raise the rates . . 

.’”; “Forcing Wal-Mart to forgo industry-standard compensation methods inhibits its ability to 

compete against companies with distribution centers outside of California, which, as Plaintiffs’ 

own purported expert, Dr. Belzer[,] agreed, ‘could send drivers into California to make deliveries’ 

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See Reply in Support of Def.’s Mot. for Summ. J. at 3 (citing Dkt. No. 330-22, Cripps Decl. Ex. 

82, “Topel Rep.” at 14-15). Rather, Topel cites to various studies showing the impact on 

productivity in switching away from a purely activity-based pay system to “other payment 

systems” (without saying what those other systems might be).3 See Topel Rep. at 14-15. Even if 

Topel’s report did assert a 9 to 22% productivity loss for Wal-Mart, in Mendonca, the Ninth 

Circuit rejected the trucking association’s argument that the prevailing wage claim was “related 

to” its prices, routes, and services because compliance with the law “increases its prices by 25% . . 

. .” See 152 F.3d at 1189.

Complying with State minimum wage law may impose a cost on businesses and have the 

effect of increasing a business’s costs which, necessarily, may be reflected in the prices that it 

charges to customers. This does not mean that State minimum wage laws are sufficiently “related 

to a price, route, or service of any motor carrier . . . with respect to the transportation of property.” 

See 49 U.S.C. § 14501(c)(1) (emphasis added). Complying with meal and rest break laws also 

imposes a cost on businesses, as Wal-Mart has attempted to show with the Declaration of Billy 

Deatherage, see Dkt. No. 324-2, Deatherage Decl. ¶ 17, but this does not mean that those laws are 

preempted. See Dilts, 769 F.3d at 647. Likewise, state safety regulations could be expected to 

have an impact on a carrier’s prices, but again the Ninth Circuit has said that “[t]he FAAAA 

expressly does not regulate a state’s authority to” enact such regulations. Dilts, 769 F.3d at 644. 

At the hearing, Wal-Mart emphasized that California minimum wage law differs from 

meal and rest break laws because the latter are “laws of general applicability.” Wal-Mart argued 

that California minimum wage laws are not generally applicable because they target trucking 

companies in a unique way, given that trucking companies traditionally use activity-based pay 

systems and must account for driver layovers. The Court is not persuaded. California minimum 

wage laws are no less generally applicable than meal and rest break laws. “They are normal 

 

without complying with California law”) (emphases added).

3

Plaintiffs have countered with deposition testimony from Dr. Topel that drivers are doing 

the same work in the pre- and post- October 2015 pay systems and that the inefficiency lies in 

increased administrative costs related to HR and payroll. Dkt. No. 339-1, Artenian Decl. Ex. A 

(“Topel Dep.”) at 67:8-68:23.

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background rules for almost all employers doing business in the state of California.” See Dilts, 

769 F.3d at 647. And arguably, the prevailing wage laws that were found not to be preempted in 

Mendonca were less generally applicable than minimum wage law because they applied

specifically to contractors awarded public works contracts. See 152 F.3d at 1186. The bottom line 

of Wal-Mart’s argument is that complying with California minimum wage law imposes extra costs 

on trucking companies, and the Ninth Circuit has found that preemption does not always follow 

where a state law imposes costs on a trucking company. As explained in Dilts, “even if state laws 

increase or change a motor carrier’s operating costs, ‘broad law[s] applying to hundreds of 

different industries’ with no other ‘forbidden connection with prices[, routes,] and services’—that 

is, those that do not directly or indirectly mandate, prohibit, or otherwise regulate certain prices, 

routes, or services—are not preempted by the FAAAA.” 769 F.3d at 647 (quoting Air Transp. 

Ass’n of America v. City & Cnty. of San Francisco, 266 F.3d 1064, 1072 (9th Cir. 2001)). 

California’s minimum wage law is such a law.

Finding the Ninth Circuit’s reasoning in Mendonca and Dilts to apply with equal force 

here, the Court finds that the FAAAA does not preempt California minimum wage law. As such, 

defendant’s motion for summary judgment on the issue of preemption is DENIED and plaintiffs’ 

cross-motion for summary judgment is GRANTED.

B. Named Plaintiffs’ Individual Damages

Wal-Mart has also moved for summary judgment based on its argument that each named 

plaintiff has failed to offer evidence to prove “‘[t]he amount of wages owed’ to him, which,” WalMart argues, “is an essential element of a minimum wage claim under California law.” Def.’s 

Mot. for Summ. J. at 20 (citing Judicial Council of Cal. Civil Jury Instructions, CACI No. 2701 

(2014 ed.)). Plaintiffs oppose, arguing that Wal-Mart fails to cite any authority making it a 

requirement that class representatives must prove their individual damages, and that in any event 

plaintiffs’ economic expert has produced the necessary information. Pls.’ Opp’n to Def.’s Mot. 

for Summ J. at 22.

Upon closer examination, Wal-Mart’s motion is more properly construed not as a motion 

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for summary judgment but rather as a motion for sanctions under Rule 37. See Def.’s Reply in 

Support of Mot. for Summ. J. at 14. Defendant argues in its motion that plaintiffs’ expert 

disclosures, due on May 13, 2016, see Dkt. No. 242, do not state the amount of actual damages 

that the named plaintiffs seek and that plaintiffs’ experts have not offered any opinions regarding 

the named plaintiffs’ actual damages. Def.’s Mot for Summ. J. at 20. In their opposition, 

plaintiffs state that their expert Dr. G. Michael Phillips filed “extensive reports and calculations of 

damages made on a classwide basis, derived from individual damage computations for all class 

members.” Pls.’ Opp’n to Def.’s Mot. for Summ J. at 23. Further, plaintiffs note that on July 12, 

2016, Dr. Phillips filed a supplemental report containing individual damage calculations at 

Appendix K. Id. at 25 (citing Dkt. No. 338, Phillips Decl. ¶¶ 16-18). In its reply, Wal-Mart’s 

argument shifts slightly. Rather than disputing that plaintiffs have provided the individual 

damages calculations that Wal-Mart seeks, it now argues that, because Dr. Phillips did not offer 

the individual damages calculations in his initial report filed in May, that evidence is now 

inadmissible. Reply in Support of Def.’s Mot. for Summ. J. at 14-15.

Federal Rule of Civil Procedure 26(a)(2) states, in part, that a party’s expert report must 

contain “a complete statement of all opinions the witness will express and the basis and reasons 

for them . . . .” Fed. R. Civ. P. 26(a)(2)(B)(i). As explained in one of the cases cited by 

defendant, “[t]he requirement of a detailed report [under Fed. R. Civ. P. 26(a)(2)] serves several 

functions. It helps the opposing party to meaningfully depose the expert; it helps the opposing 

party to determine its own expert needs; and it prevents the expert from ‘lying in wait’ with new, 

last-minute opinions.” Harrelson v. Dupnik, Case No. 11-cv-0411-TUC-FRZ (BPV), 2014 WL 

2510530, at *4 (D. Ariz. Mar. 12, 2014), report and recommendation adopted as modified by 2014 

WL 2510569 (D. Ariz. June 4, 2014). 

“Rule 37(c)(1) gives teeth to these requirements by forbidding the use at trial of any 

information required to be disclosed by Rule 26(a) that is not properly disclosed.” Yeti by Molly, 

Ltd. v. Deckers Outdoor Corp., 259 F.3d 1101, 1106 (9th Cir. 2001). However, information that is 

not disclosed under Rule 26(a)(2) may still be introduced at trial “if the parties’ failure to disclose 

the required information is substantially justified or harmless.” Id. (citing Fed. R. Civ. P. 

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37(c)(1)); see also Lanard Toys Ltd. v. Novelty, Inc., 375 Fed. App’x 705, 713 (9th Cir. 2010) 

(“Rule 37(c)(1) did not . . . strip the district courts of discretion to allow expert testimony in 

appropriate circumstances . . . .”). In determining whether a discovery deadline violation is 

justified or harmless, the district court may consider: “(1) prejudice or surprise to the party against 

whom the evidence is offered; (2) the ability of that party to cure the prejudice; (3) the likelihood 

of disruption of the trial; and (4) bad faith or willfulness involved in not timely disclosing the 

evidence.” Lanard Toys, 375 Fed. App’x at 713 (citing David v. Caterpillar, Inc., 324 F.3d 851, 

857 (7th Cir. 2003)). The party facing sanctions bears the burden of proving justification or 

harmlessness. Yeti, 259 F.3d at 1107. 

A number of the cases that Wal-Mart cites in support involved motions in limine, where 

the district court faced the question of whether information that was completely absent from an 

expert report could be the subject of testimony at trial. See U.S. Fidelity & Guaranty Co., 641 

F.3d 1126, 1138 (9th Cir. 2011); Harrelson, 2014 WL 2510530, at *4 (limiting scope of expert 

testimony to exclude opinions not contained in expert report where the “testimony goes to much 

more than merely supplementing, elaborating upon, and explaining his report”); Therasense, Inc. 

v. Becton, Dickinson & Co., No. 04-cv-2123-WHA, 2008 WL 2037732, at *4 (N.D. Cal. May 12, 

2008) (experts’ testimony on direct examination to be limited “to the four corners of their report,” 

with trial roughly two weeks away). Other cases, involving late disclosed information, presented 

more extreme situations than what the Court has before it here. See Yeti, 259 F.3d at 1105-07 (not 

abuse of discretion to exclude initial expert report that was not disclosed until almost two years 

after close of discovery and just twenty-eight days before trial); Churchill v. U.S., No. 09-cv-1846-

LJO-JLT, 2011 WL 444849 (E.D. Cal. Feb. 8, 2011) (granting in part motion to strike where party 

failed to file anything by the expert disclosure deadline and filed the report forty days late, eight 

days after the deadline for supplemental expert reports).

Here, even if plaintiffs should have disclosed the individual damages awards in the initial 

expert report, the Court finds that the failure to do so was harmless. The parties agree that Dr. 

Phillips filed an initial report by the disclosure deadline of May 13, 2016. That report contained 

aggregate damages figures and stated that the report may be amended as additional data became 

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available. Dkt. No. 341, Phillips Decl. Ex. A. Dr. Phillips has filed a declaration stating that he 

received production of “a large quantity of ‘GasBoy’ data” as well as final deposition transcripts

on June 21, 2016, and that he “received further production of DOT/CHP paper records” on July 6, 

2016. Phillips Decl. ¶¶ 5, 6, 9. In June, Wal-Mart disclosed that it had discovered forty-two 

previously unidentified class members, and the parties approached the Court regarding 

supplementing expert reports and making schedule adjustments. The Court agreed to allow 

supplemental expert reports, with plaintiffs’ supplemental report due July 12, 2016, and 

defendant’s due July 19, 2016. Dkt. No. 320. The Court also agreed, over plaintiffs’ objections, 

to move the trial date back by several weeks. See id. Dr. Phillips produced his supplemental 

report on the deadline of July 12, 2016. See Phillips Decl. ¶ 10. This report contained an 

“Appendix K – Detailed Calculations,” which broke down the damages estimates by individual 

driver. Phillips Decl. Ex. B. Defendant then sought, and received, an extension of time for its 

own expert to rebut the supplemental report of Dr. Phillips; the Court agreed to move the deadline 

for defendant’s supplemental report from July 19, 2016, to July 29, 2016. Dkt. No. 334. 

Therefore, defendant’s expert had over two weeks to review and respond to the supplemental 

report of Dr. Phillips. Dr. Phillips’s deposition was scheduled for August 5, 2016, and the papers 

filed since then indicate that the deposition went forward. 

From what the Court can see, no harm has fallen to defendant by the supplemental report 

filed on July 12, 2016. Defendant has not been deprived of its ability to meaningfully depose Dr. 

Phillips as to the individual damages claims set forth in his supplemental report. And defendants 

sought and received an extension of time for their expert to file a supplemental rebuttal report. 

Therefore, the Court will not order the sanction of excluding Dr. Phillips’s testimony.4 5 The 

 

4

Plaintiffs also apparently argue that the late filed supplemental report was substantially 

justified because Dr. Phillips received additional data from defendant after the filing of the initial 

report. Having found that the late supplementation of the report under the circumstances 

described above was harmless, the Court makes no finding as to whether it was also substantially 

justified.

5

The Court notes that Wal-Mart has filed five motions to strike the reports and opinions of 

plaintiffs’ experts, including the supplemental report of Dr. Phillips. Dkt. Nos. 336, 360, 361, 

365, 372. These motions are set to be heard on September 9, 2016.

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Court DENIES defendant’s motion for summary judgment on this point.

III. Motion to Decertify the Class

Finally, defendant has moved to decertify the class. On September 10, 2014, the Court, 

pursuant to Federal Rule of Civil Procedure 23(b)(3), granted in part and denied in part plaintiffs’ 

motion for class certification. Dkt. No. 158. As to the plaintiffs’ minimum wage claims, the 

Court certified a class consisting of: “all persons employed in California by defendant in the 

position of Private Fleet Driver at any time between October 10, 2004 and the date of trial.”6 7 

Mot. to Decert. at 6, 21. In its class certification order, the Court stated that “if it later becomes 

clear that there are major variations in the time class-members spent completing tasks like 

paperwork or fueling, defendant may move to decertify the class.” Dkt. No. 158 at 14. 

Defendant now does so, arguing that discovery has uncovered wide variation among the 

class members in time spent on the various tasks that are the subject of plaintiffs’ minimum wage 

claims. Defendant largely attacks the commonality prong of Rule 23(a) and the predominance 

prong of Rule 23(b)(3). Defendant also argues that plaintiffs have not presented a viable plan for 

trying this case in a manageable fashion.

A. Legal Standard

The decision as to whether to certify a class is committed to the discretion of the district 

court within the guidelines of Federal Rule of Civil Procedure 23. See Cummings v. Connell, 316 

F.3d 886, 895 (9th Cir. 2003). A court may certify a class if a plaintiff demonstrates that all of the 

prerequisites of Federal Rule of Civil Procedure 23(a) have been met, and that at least one of the 

requirements of Rule 23(b) have been met. See Valentino v. Carter-Wallace, Inc., 97 F.3d 1227, 

 

6

The Court also certified a sub-class of drivers who had left their employment with 

defendant and who sought waiting-time penalties. The sub-class is not the focus of the present 

motion.

7 At the hearing, the parties indicated that they would be meeting and conferring to prepare 

a stipulation that the cut-off date for the class be October 15, 2015, the date on which Wal-Mart 

implemented certain changes to its policies. The parties filed this stipulation on August 29, 2016. 

Dkt. No. 404.

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1234 (9th Cir. 1996). 

Rule 23(a) provides four prerequisites that must be satisfied for class certification: (1) the 

class must be so numerous that joinder of all members is impracticable, (2) questions of law or 

fact exist that are common to the class, (3) the claims or defenses of the representative parties are 

typical of the claims or defenses of the class, and (4) the representative parties will fairly and 

adequately protect the interests of the class. Fed. R. Civ. Proc. 23(a).

A plaintiff must also satisfy at least one of the three requirements listed in Rule 23(b): (1) 

there is a risk of substantial prejudice from separate actions, (2) that declaratory or injunctive relief 

benefitting the class as a whole would be appropriate, or (3) that common questions of law or fact 

predominate and the class action is superior to other available methods of adjudication. Fed. R. 

Civ. Proc. 23(b). The plaintiffs “must actually prove – not simply plead – that their proposed class 

satisfies each requirement of Rule 23, including (if applicable) the predominance requirement of 

Rule 23(b)(3).” Halliburton Co. v. Erica P. John Fund, Inc., 134 S. Ct. 2398, 2412 (2014) (citing 

Comcast Corp v. Behrend, 133 S. Ct. 1426, 1431-32 (2013); Wal-Mart Stores, Inc. v. Dukes, 564 

U.S. 338, 350-51 (2011)). 

Pursuant to Federal Rule of Civil Procedure 23(c)(1), an order certifying a class “may be 

altered or amended before final judgment.” In considering the appropriateness of decertification, 

the standard of review is the same as a motion for class certification: whether the Rule 23 

requirements are met. See O’Connor v. Boeing N. Am., Inc., 197 F.R.D. 404, 410 (C.D. Cal. 

2000). “Although certification decisions are not to focus on the merits of a plaintiff’s claim, a 

district court reevaluating the basis for certification may consider its previous substantive rulings 

in the context of the history of the case, and may consider the nature and range of proof necessary 

to establish the class-wide allegations.” Marlo v. UPS, 251 F.R.D. 476, 479 (N.D. Cal. 2008) 

(internal citations omitted). While the defendant has the burden of proof on the merits of its 

affirmative defenses, plaintiffs have the burden of proof in regard to satisfying Rule 23. Marlo v. 

UPS, 639 F.3d 942, 947 (9th Cir. 2011) (in motion for decertification, although employer has the 

burden of proof regarding applicability of wage and hour exemption, the plaintiff “bears the 

burden of demonstrating that the requirements of Rules 23(a) and (b) are met”) (citation omitted). 

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B. Commonality

Rule 23(a)(2) requires that there be “questions of law or fact common to the class.” Fed. 

R. Civ. P. 23(a)(2). “Commonality requires the plaintiff to demonstrate that the class members 

have suffered the same injury,” not “merely that they have all suffered a violation of the same 

provision of law.” Wal-Mart, 131 S. Ct. at 2551 (quoting Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 

147, 157 (1982) (internal quotation mark omitted)). Plaintiffs’ claims “must depend on a common 

contention,” and that common contention “must be of such a nature that it is capable of classwide 

resolution—which means that determination of its truth or falsity will resolve an issue that is 

central to the validity of each one of the claims in one stroke.” Id.

Wal-Mart argues that variation among class members here means that there is no common 

answer to the questions that the Court previously found were capable of being answered on a 

class-wide basis. Def.’s Mot. to Decert. at 13. Wal-Mart cites to discovery conducted since class 

certification in support of its assertion that there is wide variability among the class members. At 

the hearing, the parties indicated that forty-eight class members, including named plaintiffs, have 

been deposed at this point. From that information, Wal-Mart has identified variations in the time 

spent completing paperwork, weighing the truck, performing inspections, fueling, washing the 

truck, waiting, and taking rest breaks. Def.’s Mot. to Decert. at 4-6. For instance, Wal-Mart 

points to discovery suggesting that the time drivers spent performing pre-trip and post-trip 

inspections could vary from five minutes to thirty minutes. Id. at 5 (citing Cripps Decl. Ex. 77,8

Steele Survey; Ex. 68, Laurye Survey; Ex. 76, Trevino Survey; Ex. 62 Batham Survey). Estimates 

of time spent fueling ranged from five to sixty minutes. Id. (citing Cripps Decl. Ex. 10, Benavidez 

Dep. 69:2-18; Ex. 27, Garcia Dep. 102:18-23; Ex. 74, Steele Survey; Ex. 73, Rivero Survey; Ex. 

3, Alumbaugh Dep. 49:2-9). Other tasks, such as weighing the truck, were random, varying from 

weeks without weighing to weighing several times in one week. Id. at 4 (citing Cripps Decl., Ex. 

3, Alumbaugh Dep. 64:2-6; Ex. 10, Benavidez Dep. 62:8-25; Ex. 67, Johnston Dep. 28:15-25). 

Some plaintiffs stated that they never performed some activities at all, such as taking rest breaks. 

 

8

This should be cited as Exhibit 74.

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See id. at 6 (citing Ex. 48, Opitz Dep. 78:10-18; Ex. 21, Day Dep. 97:3-5

9

).

Wal-Mart relies heavily on the recent decision denying class certification in Burnell v. 

Swift Transp. Co. of Ariz., LLC, No. 10-809-VAP, 2016 WL 2621616 (C.D. Cal. May 4, 2016). 

There, California drivers sought to pursue minimum wage claims as a class. The court in that case 

denied class certification based in part on a lack of commonality, stating: 

In Wal–Mart, the Supreme Court provided guidance on how a court must approach 

the issue of commonality for purposes of class certification. A plaintiff must show 

“significant proof that [an employer] operated under a general policy . . . .” Wal–

Mart, 131 S.Ct. at 2553. In other words, Plaintiffs must show that Swift had a 

general policy of not paying minimum wage to its drivers. Plaintiffs do not make 

this showing.

Burnell, 2016 WL 2621616, at *2. 

That is not the case here, however, where the Court previously found that Wal-Mart’s 

arguments did “not negate plaintiffs’ assertion that there is a general default policy, defined in the 

driver reference and pay manuals, against paying drivers for certain tasks.” Dkt. No. 158 at 9. 

Since class certification, the Court has granted two of plaintiffs’ motions for partial summary 

judgment on the grounds that Wal-Mart’s pay policies, as detailed in Wal-Mart’s 2001, 2006, and 

2008 Driver Pay Manuals, “violate California wage law by failing to pay drivers at least minimum 

wage for all of the time they work . . . .” Dkt. Nos. 211 at 15, 286.

The Court previously certified the driver class after finding the following common 

questions of law or fact: “whether Wal-Mart’s piece-rate pay plan violates California’s minimum 

wage laws, whether Wal-Mart’s drivers are entitled to payment of at least minimum wages for all 

hours worked, and whether drivers are entitled to damages for these claims.” Dkt. No. 158 at 9. 

In its opposition to the class certification motion, Wal-mart raised the same concerns that it raises 

here, arguing that variation among whether class members performed certain activities, and for 

how long, and whether they were paid for them, precluded certification. Dkt. No. 130 at 9-13.

The Court found otherwise: “Plaintiffs have alleged a specific set of practices for not paying 

drivers for certain tasks that are applicable to all drivers in the proposed class.” Dkt. No. 158 at 9. 

 

9

This should be cited as Ex. 21, Day Dep. 98:15-24.

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As previously explained, “[d]efendant’s arguments pertain to the calculation of each individual’s 

damages and thus do not prevent certification on the common questions concerning Wal-Mart’s 

liability.” Dkt. No. 158 at 18. The Court finds that this remains true today.

Wal-Mart also argues that the class lacks commonality “because discovery has confirmed 

that the class contains members who were not injured and accordingly lack Article III standing.” 

Def.’s Mot. to Decert. at 14. The Court agrees that class members may not recover for harm they 

did not suffer. The Court has not previously required that plaintiffs present a plan for addressing 

any uninjured class members. In their papers, plaintiffs argue for a broader view of Article III 

standing in this case, stating that Wal-Mart has failed to identify “a single driver who was not 

subjected to its piece-rate pay plan or who was never paid less than minimum wage . . . .” Citing 

Tyson Foods, Inc. v. Bouaphakeo, 136 S. Ct. 1036, 1049-50 (2016), plaintiffs imply that WalMart’s concern can be addressed later “in a challenge to a proposed method of allocation after 

judgment.” Pls.’ Opp’n to Mot. to Decert. at 22. A review of Tyson Foods indicates that the 

Supreme Court determined that the question of how to ensure that uninjured class members “do 

not contribute to the size of any damage award and . . . cannot recover such damages” was an 

important one. See Tyson Foods, 136 S. Ct. at 1049. Nevertheless, it was a premature question, 

where “the damages award has not yet been disbursed” and in the absence of a “record indicat[ing]

how it will be disbursed.” Id. at 1050. Accordingly, the Court agrees with plaintiffs that the 

presence of uninjured class members should not serve as a basis for decertifying the class. 

However, plaintiffs should be prepared to address this question and propose a solution as the case 

proceeds towards trial.

C. Predominance and Manageability

Wal-Mart frames its attack on the predominance requirement of Rule 23(b)(3) as an issue 

of manageability. In addition to the prerequisites of Rule 23(a), “Rule 23(b) also requires that 

class resolution must be ‘superior to other available methods for the fair and efficient adjudication 

of the controversy.” Hanlon, 150 F.3d at 1023 (quoting Fed. R. Civ. P. 23(b)(3)). Among the 

factors that courts must consider are the difficulties likely to be encountered in the management of 

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a class action. Zinser v. Accufix Research Inst., Inc., 253 F.3d 1180, 1190-92 (9th Cir. 2001).

Wal-Mart argues that plaintiffs “have not delivered on their promise of a classwide method 

of trying this case to judgment.” Def.’s Mot. to Decert. at 15. In its class certification order, the 

Court did not require that plaintiffs present a trial plan. The Court also was and is mindful of the 

Ninth Circuit’s direction that “damages determinations are individual in nearly all wage-and-hour 

class actions” and that “damages calculations alone cannot defeat certification.” See Leyva v. 

Medline Industries Inc., 716 F.3d 510, 513 (9th Cir. 2013). In Leyva, the Ninth Circuit reversed a 

district court’s denial of class certification where “[t]he only individualized factor that the district 

court identified was the amount of pay owed.” Id. The Ninth Circuit recently reiterated that a 

“district court [does] not abuse its discretion in holding that different damages calculations do not 

defeat predominance” in a wage and hour case. Vaquero v. Ashley Furniture, Indus., Inc., 824 

F.3d 1150, 1155 (9th Cir. 2016). Likewise here, the variability that Wal-Mart points to that it 

gathered in discovery is in the amount of time that drivers spent on various activities—in other 

words, “the amount of pay owed.” See id. 

After briefing was complete and oral argument held, Wal-Mart filed a notice of 

supplemental authority regarding its motion to decertify. Dkt. No. 391. The first case to which it 

draws the Court’s attention is Harnish v. Widener University School of Law, --- F.3d ----, No. 15-

3888, 2016 WL 4363133 (3d Cir. Aug. 16, 2016), which Wal-Mart says “discusses a trial court’s 

obligation to separately analyze the ‘fact of damage’ in deciding whether a claim can proceed on a 

class basis.” Id. It is unclear why Wal-Mart filed this out-of-circuit case, which does not appear

to establish a new rule of law and does not factually resemble the case at hand. Nevertheless, the 

Court notes that if it were to follow the Third Circuit’s guidance to look for “the fact of damage –

‘ascertainable loss’ and a ‘causal relationship’ – class wide[,]” the result would be no different. 

See Harnish, 2016 WL 4363133, at *4. The Court has previously addressed the ascertainability of 

loss in its motion certifying the class, and re-addresses that question below. See Dkt. No. 158 at 

20. And the question of a “causal relationship” between the conduct and harm alleged is clear in 

this case, as opposed to in Harnish, where a group of former law students sued their school for 

allegedly inflating tuition based on false employment figures. See Harnish, 2016 WL 4363133, at 

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*9 (stating that New Jersey state courts do not recognize “price inflation as a cause of 

ascertainable loss”) (internal quotation marks omitted); see also Vaquero, 824 F.3d at 1155 (“In a 

wage and hour case . . . the employer-defendant’s actions necessarily caused the class members’ 

injury.”).

The second case to which Wal-Mart points in its recently filed notice is a decision by 

Judge Breyer of this district granting a motion to decertify a California rest break class. See In re: 

Autozone, Inc., No. 10-md-2159-CRB, 2016 WL 4208200 (N.D. Cal. Aug. 10, 2016). Judge 

Breyer did this because “two facts stand out as substantially different than the Court understood 

them to be at class certification.” Id. at *9. First, contrary to that court’s prior understanding, “the 

policy with the unlawful language about rest breaks was not in place throughout the class period.” 

Id. The class period ran from July 2005, and the unlawful language upon which Judge Breyer had 

certified the class was not in place until 2008. Id. “Second, contrary to Plaintiffs' counsel's 

representations at the class certification hearing, there are no audit records or any other time 

records of when class members took rest breaks.” Id. Such significant changes in facts since class 

certification are simply not present here. See also O’Connor, 197 F.R.D. at 409-10 (class 

certification will typically not be revisited except that “[s]ometimes . . . developments in the 

litigation, such as the discovery of new facts or changes in the parties or in the substantive or 

procedural law[] will necessitate reconsideration . . . .”) Further, much of Judge Breyer’s 

reasoning rests on comparing and contrasting cases in which a uniform policy applied throughout 

the class period. See Autozone, 2016 WL 4208200, at *12-13. The Court has already ruled on the 

relevant uniform policies in place at Wal-Mart from the beginning of the class period, and the 

parties have agreed that the class period here will be cut off in October 2015, when Wal-Mart 

changed its policies. Thus, one of the major rationales for Judge Breyer decertifying the Autozone

class is absent here.10

 

10 To the extent that Wal-Mart flags the Autozone opinion because of its analysis of class 

member survey data and its suitability under Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 

U.S. 579 (1993), the Court again notes that there are five pending Daubert motions set for hearing 

shortly. See n.5, supra. Should the Court’s ruling on those Daubert motions affect today’s ruling 

on the motion to decertify, the Court will revisit this Order and modify it accordingly.

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With trial less than two months away, however, the Court agrees with Wal-Mart that 

plaintiffs need to present a plan for manageably trying this case. The plan currently before the 

Court, as discerned from plaintiffs’ opposition papers, appears to mirror the plan presented at the 

class certification stage. At that point, plaintiffs presented declarations from two experts who 

created a methodology for calculating damages using Wal-Mart’s pay records and, where the 

records lacked certain information, results of a class member survey. Dkt. No. 158 at 19-20. 

Now, plaintiffs have submitted reports from Dr. Phillips that similarly rely on Wal-Mart’s records, 

deposition testimony, and a questionnaire administered to certain class members, among other 

information. Phillips Decl., Ex. A at 4-6. 

At the hearing, plaintiffs explained the trial plan as follows. For certain activities, 

plaintiffs will use hard data from Wal-Mart’s records. For instance, Wal-Mart tracked which 

drivers received a $42 stipend for taking a layover, so plaintiffs can calculate how much allegedly 

remains owed for layovers taken in the tractor cab. See Pls.’ Opp’n to Mot. to Decert.at 16-17. 

Plaintiffs propose calculating pre- and post-trip inspections using Wal-Mart data showing how 

many days a worker worked. Because at least one pre-trip inspection must be completed at the 

beginning of the workday and one post-trip inspection at the end, plaintiffs propose calculating 

these at one and one per work day. Rest breaks will be determined from data showing the number 

of days a driver drove and the length of the shift, with plaintiffs assuming two rest breaks per day. 

Other calculations will not come from “hard data” because Wal-Mart does not track this 

information. These include: the length of the pre-trip inspection, which plaintiffs propose 

calculating based on 30(b)(6) deposition testimony, Wal-Mart’s training video, testimony from a 

trucking expert, and other deposition testimony; the length of rest breaks, which plaintiffs intend 

to cap at ten minutes, per California law; the time spent washing the truck; and the time spent 

weighing the truck. Plaintiffs have also clarified their paperwork theory. For paperwork 

completion, plaintiffs state in their opposition brief that their “paperwork claim is limited to the 

time drivers spend meeting with driver coordinators at the beginning and end of each trip.” Pls.’ 

Opp’n to Mot. to Decert. at 5. 

Wal-Mart attacks plaintiffs’ proposed use of representative testimony and argues that the 

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situation here is distinguishable from the method of calculating damages that the Supreme Court 

recently approved in Tyson Foods. In that case, workers sued for overtime wages they alleged 

were owed for uncompensated time spent donning and doffing protective gear as part of their jobs. 

The Supreme Court affirmed the decision to certify the class, agreeing that class issues 

predominated over individual ones. 

The Court also found that, in the absence of employer records on the amount of time spent 

donning and doffing, representative sampling could be used to show classwide liability. Tyson 

Foods, 136 S. Ct. at 1046. There, plaintiffs proposed to use a combination of “employee 

testimony, video recordings of donning and doffing at the plant, and, most important, a study 

performed by an industrial relations expert” who conducted 744 videotaped observations to 

produce an average time for donning and doffing. Id. at 1043. This does not substantially differ 

from some of the proposed methods that plaintiffs have forwarded here. For instance, plaintiffs’

method for calculating the average time for pre- and post-trip inspections seeks to use employee 

testimony, a Wal-Mart training video, testimony from plaintiffs’ expert, and testimony from WalMart’s 30(b)(6) deponent. The types of sampling that plaintiffs seek to admit “would have been 

appropriate for an individual class member to use in an individual action because an employee 

cannot travel back in time and record how long it took to [conduct a certain task] each day . . . .” 

See Autozone, 2016 WL 4208200, at *15 (citing Tyson Foods and distinguishing Dukes, where 

plaintiffs “sought to establish that a small number of employees had experienced sex 

discrimination, and then to extrapolate those results to the class as a whole”). 

Part of the Supreme Court’s rationale for approving the use of representative sampling

rested on the fact that “[i]n many cases, a representative sample is ‘the only practicable means to 

collect and present relevant data’ establishing a defendant’s liability.” Id. at 1046. In Tyson 

Foods, the defendant never recorded the time spent donning and doffing. Id. at 1042. The 

Supreme Court noted, “As a result of Tyson's failure to keep records of donning and doffing time, 

however, the employees were forced to rely on what the parties describe as ‘representative 

evidence.’” Id. at 1043. 

The Supreme Court reiterated that in Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680 

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(1946), it held that employees should not be punished by the denial of recovery based on the 

grounds that the employer has not kept records of “the precise extent of uncompensated work.” 

Id. at 1047 (citing Mt. Clemens, 328 U.S. at 687. Where an employer lacks accurate or adequate 

records: 

an employee has carried out his burden if he proves that he has in fact performed 

work for which he was improperly compensated and if he produces sufficient 

evidence to show the amount and extent of that work as a matter of just and 

reasonable inference. The burden then shifts to the employer to come forward with 

evidence of the precise amount of work performed or with evidence to negative the 

reasonableness of the inference to be drawn from the employee's evidence.

Mt. Clemens, 328 U.S. at 687-88. Although Mt. Clemens involved the statutory duty to keep 

records under the Fair Labor Standards Act, the Court finds the policy rationales of the Mt. 

Clemens decision to be informative. Plaintiffs in this case should not be punished by Wal-Mart’s 

lack of records regarding time spent on activities such as pre- and post-trip inspections, time spent 

fueling, time on paperwork, etc. See also Hernandez v. Mendoza, 199 Cal. App. 3d 721, 727 

(where employer failed to keep accurate time records, “the consequences for such failure should 

fall on the employer, not the employee”) (citing Mt. Clemens, 328 U.S. at 687; Cal. Code Regs., 

tit. 8, § 11070, subd. 7(A)(3)).

Plaintiffs have presented a plan for proving damages using a combination of hard data 

from Wal-Mart and, where Wal-Mart did not collect or keep such data, representative sampling. 

With that evidence before the jury, it will be within Wal-Mart’s rights to bring in individuals, 

whether its own experts or individual class members, in an attempt to disprove the damages model 

that plaintiffs put forward or, as the Supreme Court has described it, “to negative the 

reasonableness of the inference to be drawn from the employee’s evidence.” See Mt. Clemens, 

328 U.S. at 688. The Court finds that utilizing such a process continues to make the class action 

vehicle in this case “superior to other available methods for fairly and efficiently adjudicating the 

controversy.” See Fed. R. Civ. P. 23(b)(3). 

Finally, Wal-Mart argues that it cannot be liable for certain class members’ claims because 

some of the drivers were not California-based drivers during the class period and thus are not 

subject to California minimum wage law. Def.’s Mot. to Decert. at 20-21. Wal-Mart has made 

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this argument before, and the Court remains unpersuaded. See Dkt. No. 158 at 12. For one, it 

strikes the Court that accurate information where its truck drivers work is most likely to be in the 

hands of Wal-Mart. More importantly, the Court has certified a class of “all persons employed in 

California by defendant in the position of Private Fleet Driver . . . .” See Dkt. No. 158 at 6 

(emphasis added). Thus, drivers who were not based in California are simply not part of the class 

and are not entitled to relief.11 To the extent that Wal-Mart is concerned that non-California

drivers may somehow sneak into the class to obtain relief, this concern can be addressed 

appropriately through claims forms, should a jury ultimately award monetary relief to plaintiffs.

///

///

 

11 Relying on California Supreme Court case law, the Court has explained that this means: 

“If an employee resides in California, receives pay in California, and works exclusively, or 

principally, in California, then that employee is a ‘wage earner of California’ and presumptively 

enjoys the protection of IWC regulations.” Dkt. No. 158 at 12 (quoting Tidewater Marine 

Western, Inc. v. Bradshaw, 14 Cal. 4th 557, 578 (1996)). In its motion to decertify, Wal-Mart 

selectively quotes from Sullivan v. Oracle Corp., 51 Cal. 4th 1191, 1199 (2011). See Mot. to 

Decert. at 20. The full quote lends further support to the idea that the truck drivers in this case 

may be entitled to relief: “California law, we suggested [in Tidewater], might follow California 

resident employees of California employers who leave the state ‘temporarily . . . during the course 

of the normal workday . . . .’” Sullivan, 51 Cal. 4th at 1199.

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CONCLUSION

For the foregoing reasons, the Court GRANTS defendant’s motion to dismiss named 

plaintiff Pagtama from the case, GRANTS defendant’s motion to dismiss class members 

Williams, Taylor, and Putnam, and DENIES defendant’s motion to dismiss class member Eason. 

The parties are ORDERED to meet and confer regarding the status of proceeding with named 

plaintiff Krohn’s deposition and to file an update with the Court no later than September 2, 

2016. The Court DENIES defendant’s motion for summary judgment and GRANTS plaintiffs’ 

cross-motion for summary judgment. The Court DENIES defendant’s motion to decertify the 

class.

IT IS SO ORDERED.

Dated: August 30, 2016 ______________________________________

SUSAN ILLSTON

United States District Judge

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