Filed 1/19/22

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION SEVEN

GUILLERMO ESPINOZA,

Plaintiff and Respondent,

v.

HEPTA RUN, INC., et al.,

Defendants and 

Appellants.

 B306292

 (Los Angeles County

 Super. Ct. No. NC061371)

APPEAL from an order and judgment of the Superior Court 

of Los Angeles County, Mark C. Kim, Judge. Affirmed in part, 

reversed in part with directions.

Booth, Hillary Arrow Booth and Allan P. Bareng for 

Defendants and Appellants Hepta Run, Inc. and Ed Tseng.

Law Offices of Stephen Glick and M. Anthony Jenkins for 

Plaintiff and Respondent.

___________________________________
2

Guillermo Espinoza sued his former employer, Hepta Run, 

Inc., and its owner, Ed Tseng, asserting causes of action for Labor 

Code wage and hour violations, unfair business practices in 

violation of California’s unfair competition law (Bus. & Prof. 

Code, § 17200 et seq.) and representative claims for penalties

under the Labor Code Private Attorneys General Act of 2004 

(PAGA) (Lab. Code, § 2698 et seq.).

1

 Following a bench trial the 

court entered judgment in favor of Espinoza for $84,117.73. 

Hepta Run and Tseng appeal the judgment, as well as the trial 

court’s earlier order denying their motion for summary 

adjudication based on federal preemption of Espinoza’s meal and 

rest period claims. We agree the trial court erred in denying the 

motion for summary adjudication, reverse the judgment to that 

extent, otherwise affirm, and remand with directions for the trial 

court to redetermine the appropriate damage award and modify 

the judgment accordingly. 

FACTUAL AND PROCEDURAL BACKGROUND

1. Espinoza’s Claims and the Motion for Summary 

Adjudication

On September 11, 2017 Espinoza filed a complaint, and on 

June 21, 2019 the operative fourth amended complaint, against 

Hepta Run, Tseng and Tawny Hart, who Espinoza believed to be 

the general manager of Hepta Run,2 alleging causes of action for 

1 Statutory references are to this code unless otherwise 

stated.

2 At the conclusion of Espinoza’s case-in-chief, the trial court 

granted Hart’s motion for a directed verdict; and judgment was 

entered in her favor on January 23, 2020. Hart is not a party to 

this appeal. 
3

failure to reimburse for work expenses (§ 2802) (first cause of 

action), failure to pay minimum wage for nonproductive time

(§ 1194) (second cause of action), failure to compensate for rest 

periods (§ 226.2) (third and fourth causes of action), failure to 

provide meal and rest periods (§ 226.7) (fifth and sixth causes of 

action), waiting time penalties (§ 203) (seventh cause of action), 

failure to furnish itemized wage statements (§ 226) (eighth cause 

of action), unfair business practices (ninth cause of action), and 

representative claims for civil penalties under PAGA (tenth and 

eleventh causes of action). Espinoza further alleged Tseng and 

Hart were personally liable for damages accrued after January 1, 

2016 for the first, second, and fifth through eighth causes of 

action pursuant to section 558.1.

In April 2019 Hepta Run, Tseng and Hart moved for 

summary adjudication on the fifth and sixth causes of action, 

arguing the California statutes governing meal and rest periods

were preempted by federal regulations concerning commercial 

motor vehicle safety. The motion was denied on July 30, 2019.

2. The Bench Trial

The three-day bench trial commenced on November 18,

2019. Espinoza testified he began working as a truck driver for 

HRT Trucking, Inc. in December 2015. At some point HRT 

changed its name to Hepta Run.3 Espinoza continued to drive a 

truck for the company until November 2016. 

3 HRT was also named as a defendant in this action. The 

operative complaint alleged HRT had surrendered its right to do 

business in California, and the record does not indicate HRT 

made an appearance in the case. The exact timing of the change 

from HRT to Hepta Run and the legal mechanism by which it

was accomplished are unclear from the record. Regardless, Tseng 
4

Espinoza testified he worked approximately nine to 

12 hours per day, five days a week. At the beginning of each shift 

Espinoza went to HRT or Hepta Run’s truck yard to pick up a 

truck. He spent approximately 10 minutes doing a pre-trip 

inspection, then drove to the Port of Long Beach to pick up a 

shipping container. Once he had loaded the container onto the 

truck, which could involve waiting two or three hours for the 

container, Espinoza drove to the customer’s location to deliver the 

container. Espinoza often had to wait two or three hours at the 

customer’s location. He also regularly spent time washing and 

putting gasoline in the truck. Espinoza was instructed to watch 

the truck at all times such that he could not take a meal or rest 

break away from the truck. At the end of each shift Espinoza 

returned the truck to HRT or Hepta Run’s truck yard and left the 

keys there. He typically drove the truck a total of approximately 

60 miles each day.

Espinoza was compensated per completed trip without any 

additional or separate payment for time spent waiting, loading 

and unloading cargo or maintaining and inspecting the truck; nor 

was he compensated for any rest periods. Espinoza was paid 

weekly, and his paycheck included deductions for fuel and 

insurance. The paychecks did not list the hours worked during 

the pay period.

Tseng did not testify at trial, but portions of his deposition 

testimony were received in evidence. Although the owner and 

president of both HRT and Hepta Run, Tseng testified he was not 

testified he was the sole owner of both companies, and Hepta Run 

has not disputed the trial court’s finding it was Espinoza’s 

employer during the entirety of his employment with both 

entities.
5

involved in the companies’ daily operations and did not know 

whether they transported cargo from the Port of Long Beach. 

Tseng explained, because he had no knowledge of the trucking 

industry, he had hired a professional manager to advise him on 

establishing a business model. The manager proposed operating 

in California and paying drivers per trip. Tseng approved the 

business model. 

At the conclusion of Espinoza’s case-in-chief Tseng moved 

for nonsuit, arguing Espinoza had failed to prove his liability

under section 558.1, which provides a person acting on behalf of 

an employer who causes a Labor Code wage and hour violation is 

liable for the violation. Tseng argued he did not know anything 

about the trucking business and had merely approved the 

recommendations of the professional manager, which he asserted

was insufficient to impose personal liability under the statute. 

The court denied the motion.

After presenting their evidence Hepta Run and Tseng 

moved for a directed verdict, in part based on a lack of evidence 

Tseng could be personally liable under section 558.1. The court 

denied the motion, finding Tseng’s testimony he did not know 

anything about HRT and Hepta Run’s business was not credible. 

The court stated, “He was the sole owner of HRT, Hepta Run. He 

was the sole president of HRT and Hepta Run. He operated his 

business, including his operation in California, by hiring so-called 

professional managers. Professional managers presented him 

with a model. He approved it.” 
6

3. The Statement of Decision and Judgment

After hearing closing arguments the court found Hepta Run 

and Tseng were liable to Espinoza for Labor Code violations and 

requested additional briefing on damages.

4

Espinoza’s damages brief requested total damages on the 

first through eighth causes of action of approximately $68,000, 

plus interest. No monetary recovery was requested on the unfair 

business practices claim. Hepta Run and Tseng filed a response 

in which they argued Espinoza had not established liability for 

Labor Code violations and Tseng was not personally liable under 

section 558.1. They also disputed the methodology used to 

calculate the damages, as well as the amounts requested. 

At the outset of the hearing on damages Hepta Run and 

Tseng’s counsel informed the trial court they would stipulate to 

the damages amount. Hepta Run and Tseng requested a 

statement of decision. At the court’s request Espinoza filed a 

proposed statement of decision to which Hepta Run and Tseng 

objected.

On March 25, 2020 the trial court overruled the objections 

to the statement of decision (other than two minor changes) and 

adopted the proposed statement of decision as its final decision. 

The statement of decision explained the court’s reasoning for

finding Espinoza was an employee rather than an independent 

contractor and finding Tseng was individually liable pursuant to 

section 558.1. The court found Hepta Run and Tseng had 

deducted business expenses from Espinoza’s compensation 

4 The trial court found Espinoza was an employee of Hepta 

Run and HRT, not an independent contractor. The court also 

found Espinoza failed to establish a representative claim under 

PAGA. Neither finding has been appealed.
7

without reimbursing him, did not compensate him for rest 

periods and nonproductive time and did not provide him with 

required meal and rest periods. 

Judgment was entered on May 22, 2020. Espinoza was 

awarded $62,710.81, plus interest of $15,901.53, against Hepta 

Run and Tseng jointly and severally. In addition, Espinoza was 

awarded an additional $3,975.28, plus interest of $1,530.11, 

against Hepta Run only.

5

 

DISCUSSION

1. Standard of Review

On appeal from a judgment based on a statement of 

decision following a bench trial, we review the trial court’s legal 

interpretation of the governing statutes de novo and the court’s 

factual findings for substantial evidence. (See Ghirardo v. 

Antonioli (1994) 8 Cal.4th 791, 801; Veiseh v. Stapp (2019) 

35 Cal.App.5th 1099, 1104.) 

Substantial evidence review requires that we “‘“‘consider all 

of the evidence in the light most favorable to the prevailing party, 

giving it the benefit of every reasonable inference, and resolving 

conflicts in support of the [findings]. [Citations.]’ [Citation.] We 

may not reweigh the evidence and are bound by the trial court’s 

credibility determinations. [Citations.] Moreover, findings of fact 

are liberally construed to support the judgment.”’” (Tribeca 

Companies, LLC v. First American Title Ins. Co. (2015) 

5 Because the statute providing for personal liability of an 

employer or its representative (§ 558.1) did not go into effect until 

January 1, 2016, Espinoza sought damages from Tseng as of that 

date. Damages incurred in 2015 were sought from Hepta Run 

only.
8

239 Cal.App.4th 1088, 1102; accord, Sav-On Drug Stores, Inc. v. 

Superior Court (2004) 34 Cal.4th 319, 334 [“‘questions as to the 

weight and sufficiency of the evidence, the construction to be put 

upon it, the inferences to be drawn therefrom, the credibility of 

witnesses . . . and the determination of [any] conflicts and 

inconsistencies in their testimony are matters for the trial court 

to resolve’”]; Western States Petroleum Assn. v. Superior Court

(1995) 9 Cal.4th 559, 571 [“‘[w]hen two or more inferences can be 

reasonably deduced from the facts, the reviewing court is without 

power to substitute its deductions for those of the trial court’”].)

2. The Trial Court Erred by Denying the Motion for 

Summary Adjudication

a. Relevant procedural background

Hepta Run and Tseng moved for summary adjudication on

Espinoza’s fifth (meal periods) and sixth (rest periods) causes of 

action, arguing California laws and industry regulations 

providing for meal and rest periods were preempted by federal 

regulations governing truck drivers. In opposition Espinoza 

argued the federal regulations did not apply to short haul truck

drivers like him. The trial court agreed with Espinoza and 

denied the motion for summary adjudication.6

6 Generally, the denial of a motion for summary adjudication 

is deemed to be “harmless error after a full trial covering the 

same issues.” (Legendary Investors Group No. 1, LLC v. Niemann

(2014) 224 Cal.App.4th 1407, 1410-1411.) However, “denial of 

the motion may constitute prejudicial error if the motion is 

denied on a legal ground not presented at trial.” (Id. at p. 1411; 

see also Federal Deposit Ins. Corp. v. Dintino (2008) 

167 Cal.App.4th 333, 343.) Because the summary adjudication 

motion here did not involve disputed issues of fact and the 
9

b. General principles of preemption

The United States Supreme Court has traditionally 

recognized preemption of state law by federal enactments 

pursuant to the supremacy clause (U.S. Const., art. VI, cl. 2) in 

three circumstances: (1) express preemption; (2) implied (or field) 

preemption; and (3) conflict preemption. (English v. General 

Electric Co. (1990) 496 U.S. 72, 78-79 [110 S.Ct. 2270].) Express 

preemption, which is pertinent here, exists when Congress 

defines the extent to which its enactments will displace state law.

(Id. at p. 78; accord, Pacific Gas & Elec. Co. v. State Energy Res. 

Conservation & Dev. Com. (1983) 461 U.S. 190, 203-204 [103 

S.Ct. 1713] [“[i]t is well established that within constitutional 

limits Congress may pre-empt state authority by so stating in 

express terms”]; Valencia v. SCIS Air Security Corp. (2015) 

241 Cal.App.4th 377, 383 [“Congress has the power to enact 

federal laws that trump or ‘preempt’ conflicting state laws and 

may exercise that power by enacting an express preemption 

provision”].) “If a federal law contains an express pre-emption 

clause, it does not immediately end the inquiry because the 

question of the substance and scope of Congress’ displacement of 

state law still remains.” (Altria Group, Inc. v. Good (2008) 

555 U.S. 70, 76 [129 S.Ct. 538].)

“Federal regulations may preempt state law just as fully as 

federal statutes. [Citation.] An agency may preempt state law 

through regulations that are within the scope of its statutory 

authority and that are not arbitrary.” (Washington Mutual Bank 

v. Superior Court (2002) 95 Cal.App.4th 606, 612; accord, 

argument was not raised at trial, we review the court’s order 

denying the motion for summary adjudication.
10

Louisiana Public Service Com. v. FCC (1986) 476 U.S. 355, 369 

[106 S.Ct. 1890] [“Pre-emption may result not only from action 

taken by Congress itself; a federal agency acting within the scope 

of its congressionally delegated authority may pre-empt state 

regulation”].) A federal agency’s preemption determination based 

on interpretations of its own regulations and of the statutory 

scheme it administers should be accorded substantial deference. 

(Kisor v. Wilkie (2019) __ U.S. __ [139 S.Ct. 2400, 2415] [courts 

should defer to agency’s reasonable reading of “genuinely 

ambiguous” regulations]; Chevron, U.S.A., Inc. v. Natural Res. 

Def. Council (1984) 467 U.S. 837, 844 [104 S.Ct. 2778] 

[“considerable weight should be accorded to an executive 

department’s construction of a statutory scheme it is entrusted to 

administer”]; Washington Mutual Bank, at p. 620, fn. 5 [“[a]n 

agency’s construction of its own regulations is entitled to 

substantial deference”]; see also Zubarau v. City of Palmdale

(2011) 192 Cal.App.4th 289, 306 [“[a]n agency declaration of 

preemption can preempt unless the authorizing statute or 

legislative history of the statute is to the contrary”].)

c. California meal and rest break rules

California law provides every nonexempt employee in the 

transportation industry must be provided with a 30-minute meal 

period for every five hours worked and a 10-minute rest period 

for every four hours worked. (Cal. Code Regs., tit. 8, § 11090, 

subds. 11 & 12; see also § 226.7, subd. (c).) “If an employer fails 

to provide an employee a meal or rest or recovery period[

7

] in 

accordance with a state law, including, but not limited to, an 

7 A “‘recovery period’ means a cooldown period afforded an 

employee to prevent heat illness.” (§ 226.7, subd. (a).)
11

applicable statute or applicable regulation, . . . the employer shall 

pay the employee one additional hour of pay at the employee’s 

regular rate of compensation for each workday that the meal or 

rest or recovery period is not provided.” (§ 226.7, subd. (c); Cal.

Code Regs., tit. 8, § 11090, subds. 11(D) [meal periods] & 12(B) 

[rest periods].)

d. Applicable federal regulations 

The Motor Carrier Safety Act of 1984 empowers the 

Secretary of Transportation to “prescribe regulations on 

commercial motor vehicle safety,” including regulations ensuring 

“the responsibilities imposed on operators of commercial motor 

vehicles do not impair their ability to operate the vehicles safely.” 

(49 U.S.C. § 31136(a).) One such set of regulations, often referred 

to as the hours of service regulations or HOS, imposes limits on 

driving time and on duty time for commercial truck drivers. (See 

49 C.F.R. § 395.3 (2020).)

Pursuant to the HOS regulations property-carrying 

commercial truck drivers are subject to daily and weekly limits 

on driving time and on-duty time and are mandated to have 

10 consecutive hours off duty between shifts. (49 C.F.R. § 395.3

(2020).) In addition, long haul truck drivers are required to take 

a 30-minute rest break for every eight hours worked; short haul 

drivers are exempted from the 30-minute rest break requirement. 

(49 C.F.R. § 395.3(a)(ii).)8

8 During the relevant time period, a property-carrying short 

haul driver was defined as a driver who “operates within a 100 

air-mile radius of the normal work reporting location”; “returns to 

the work reporting location and is released from work within 

12 consecutive hours”; and “has at least 10 consecutive hours off-
12

e. The Federal Motor Carrier Safety Administration’s 

preemption determination

The Motor Carrier Safety Act of 1984 gives the Secretary of 

Transportation the authority to preempt state law if certain 

criteria are met. (49 U.S.C. § 31141(a) [“[a] State may not 

enforce a State law or regulation on commercial motor vehicle 

safety that the Secretary of Transportation decides under this 

section may not be enforced”].) To declare a state law preempted 

the Secretary must first find the state law is either less stringent, 

additional to or more stringent than the federal regulation; and, 

if the state law is additional to or more stringent, the Secretary 

must find the state law has no safety benefit, is incompatible 

with the federal regulation, or enforcement of the state law would 

cause an unreasonable burden on interstate commerce. 

(49 U.S.C. § 31141(c).) The Secretary has delegated this 

preemption analysis and determination to the Administrator for 

the Federal Motor Carrier Safety Administration (FMCSA). 

(49 C.F.R. § 1.87(f) (2020).)

In 2018, in response to petitions from two industry groups, 

the FMCSA issued an order stating the California meal and rest 

break rules (§ 226.7) were preempted by the federal hours of 

service regulations. (See California’s Meal and Rest Break Rules 

for Commercial Motor Vehicle Drivers, 83 Fed.Reg. 67470-67480

(Dec. 28, 2018).) The FMCSA undertook the preemption analysis 

mandated by Congress, finding California’s laws were additional 

to or more stringent than the federal regulations, had no safety 

benefit beyond those provided by the federal regulations, were 

duty separating each 12 hours on duty.” (49 C.F.R. § 395.1(e)(1) 

(2016).)
13

incompatible with the federal regulations and would cause an 

unreasonable burden on interstate commerce. Accordingly, the 

FMCSA concluded, “California may no longer enforce the [Meal 

and Rest Break] Rules with respect to drivers of propertycarrying [commercial motor vehicles] subject to FMCSA’s HOS 

rules.” (83 Fed.Reg. 67480.) Recently, the Ninth Circuit upheld 

the FMCSA’s determination, finding the agency’s “decision 

reflects a permissible interpretation of the Motor Carrier Safety 

Act of 1984 and is not arbitrary or capricious.” (International 

Brotherhood of Teamsters, Local 2785 v. Federal Motor Carrier 

Safety Administration (9th Cir. 2021) 986 F.3d 841, 846.)

f. The FMCSA’s preemption determination applies to 

short haul drivers

Espinoza does not challenge the findings of the FMCSA or 

its ultimate determination, where applicable, that California 

meal and rest period requirements are preempted by the federal 

hours of service regulations. Rather, Espinoza argues the 

preemption determination does not apply to short haul drivers. 

Citing the language of the FMCSA’s preemption order stating it 

applies to drivers “subject to FMCSA’s HOS rules” (83 Fed.Reg. 

67480), Espinoza argues this means “that it applies to drivers 

subject to the HOS rules, not that the Order applies to drivers 

who are subject to some of the HOS rules.” His position, in other 

words, is, because short haul drivers are exempted from one of 

the HOS rules (the 30-minute rest break rule), the preemption 

order does not apply to them.

We decline to adopt such a strained and cramped

interpretation of the FMCSA’s preemption order. It is 

undisputed that certain hours of service rules apply to short haul 

drivers, such as the daily limits on driving time and the daily and 
14

weekly limits on on-duty time. Thus, the HOS rules, as a general

matter, apply to short haul drivers. The fact that those drivers 

are exempted from one rule does not remove them from the 

universe of drivers subject to the hours of service rules, and it is 

not reasonable to read the language of the order to suggest they 

are. 

This common sense interpretation of the preemption order 

is reinforced by the fact that the FMCSA, had it intended to 

exclude short haul drivers from its preemption determination, 

could have easily, and explicitly, done so. In fact, one of the 

petitions prompting the FMCSA’s opinion requested a declaration 

that California’s meal and rest break laws “‘are preempted from 

being applied to drivers subject to the HOS regulations on rest 

breaks.’” (83 Fed.Reg. 67472.) The FMCSA, however, did not use 

this limiting language, instead repeatedly stating its decision 

applied to drivers subject to the federal HOS regulations

generally. (See 83 Fed.Reg. 67470 [“FMCSA grants the petitions 

insofar as the provisions at issue apply to drivers of propertycarrying [commercial motor vehicles] subject to the FMCSA’s 

hours of service regulations”], 67474 [California rules were 

subject to preemption review because they concern motor vehicle 

safety “as applied to property-carrying [commercial motor 

vehicle] drivers that are within the Agency’s HOS jurisdiction”], 

67477 [“the Agency determines that [California’s meal and rest 

break rules] are incompatible with the Federal HOS 

regulations”].)

Furthermore, the FMCSA’s reasoning for its preemption

decision does not support Espinoza’s interpretation of the 

opinion. For example, in determining California’s rules were 

incompatible with federal regulations, the FMCSA stated that 
15

California’s rules “are more stringent than the Federal HOS 

regulations . . . . Not only do the [California meal and rest break 

rules] require employers to provide [commercial motor vehicle] 

drivers with more rest breaks than the Federal HOS regulations, 

the timing requirements for rest periods under the [California 

meal and rest break rules] provide less flexibility than the 

Federal HOS regulations. . . . [The California requirements] . . . 

significantly reduce[ ] the flexibilities the Agency built into the 

Federal HOS regulations, and they graft onto the Federal HOS 

rules additional required rest breaks that the Agency did not see 

fit to include.” (83 Fed. Reg. 67478.) Given that short haul 

drivers are not required to take any specified rest breaks under 

the federal rules, the Agency’s concern over California’s 

additional rest break requirement would be heightened for short 

haul drivers, not diminished. Accordingly, the FMCSA’s 

reasoning supports applying preemption to short haul drivers 

rather than excluding them.9 The motion for summary 

9 The few federal court decisions that have considered the 

question whether the FMCSA’s preemption order applies to short 

haul drivers have likewise found it does, albeit without any 

explanation for their conclusion. (See Salter v. Quality Carriers, 

Inc. (C.D.Cal. Oct. 27, 2021, No. CV 20-479-JFW (JPRx)) 2021 

U.S.Dist. Lexis 213111, at p. *28 [“Plaintiff has failed to 

demonstrate that the FMCSA’s Order does not apply [to] short 

haul drivers”]; Robinson v. Chefs’ Warehouse, Inc. (N.D.Cal. 

Sept. 10, 2019, No. 15-cv-05421-RX) 2019 U.S.Dist. Lexis 154383, 

at p. *12 [“Plaintiffs have not shown, however, that the Order 

excludes short haul drivers”]; but see Arrellano v. XPO Port 

Service Inc. (C.D.Cal. Mar. 30, 2021, No. 2:18-CV-08220-RGK(E)) 

2021 U.S.Dist. Lexis 193382, at pp. *7-8 [noting employer “does 

not dispute that the FMCSA order does not preempt meal and 

rest break claims that are brought by short-haul drivers” but 
16

adjudication on Espinoza’s fifth and sixth causes of action should 

have been granted.

3. The Trial Court Did Not Err in Finding Tseng 

Personally Liable Pursuant to Section 558.1

a. Governing law

Effective January 1, 2016, section 558.1 provides: “(a) Any 

employer or other person acting on behalf of an employer, who 

violates, or causes to be violated, any provision regulating 

minimum wages or hours and days of work in any order of the 

Industrial Welfare Commission, or violates, or causes to be 

violated, Sections 203, 226, 226.7, 1193.6, 1194, or 2802, may be 

held liable as the employer for such violation. [¶] (b) For 

purposes of this section, the term ‘other person acting on behalf of 

an employer’ is limited to a natural person who is an owner, 

director, officer, or managing agent of the employer, and the term 

‘managing agent’ has the same meaning as in subdivision (b) of 

Section 3294 of the Civil Code.”

10

finding plaintiff had failed to plead that all class members were 

short haul drivers].)

10 Section 3294, subdivision (b), of the Civil Code provides an 

employer shall not be liable for punitive damages based on acts of 

an employee unless there has been “advance knowledge and 

conscious disregard, authorization, ratification or act of 

oppression, fraud, or malice” on the part of “an officer, director, or 

managing agent of the corporation.” Courts have defined a 

“managing agent” pursuant to this statute to be an employee who 

“exercises substantial discretionary authority over decisions that 

ultimately determine corporate policy.” (White v. Ultramar, Inc.

(1999) 21 Cal.4th 563, 573.)
17

Prior to the enactment of section 558.1 an employee could 

generally not recover damages for wage and hour violations from 

an individual owner or officer of the employer unless the 

employee could prove some other legal basis for liability such as 

alter ego liability. (See Voris v. Lampert (2019) 7 Cal.5th 1141, 

1159 [recognizing limited remedies for employees to recover 

against individual officers prior to section 558.1].) As a result, 

even when an employee obtained a judgment against a corporate 

employer, “the process of collecting the award [was] often difficult 

and ineffective. Irresponsible employers may have hidden their 

cash assets, declared bankruptcy, or otherwise become judgmentproof.” (Assem. Com. on Judiciary, Analysis of Sen. Bill No. 588 

(2015-2016 Reg. Sess.) as amended July 1, 2015, p. 4; accord, Sen. 

Com. on Labor & Industrial Relations, Analysis of Sen. Bill 

No. 588 (2015-2016 Reg. Sess.) Apr. 29, 2015, pp. 5-6 [“the vast 

majority of wage theft victims received nothing, and those that 

received anything received little of what they were legally due”].) 

In response to this problem, section 558.1 was intended by 

the Legislature to expand liability for wage and hour violations 

and “discourage business owners from rolling up their operations 

and walking away from their debts to workers and starting a new 

company.” (Sen. Com. on Judiciary, Analysis of Sen. Bill No. 588 

(2015-2016 Reg. Sess.) Apr. 20, 2015, p. 12; see also Voris v. 

Lampert, supra, 7 Cal.5th at p. 1161 [section 558.1 “targets 

individual officers who are involved in the failure to pay wages”].)

b. Substantial evidence supports the finding Tseng 

caused the Labor Code violations

Tseng contends he cannot be held liable pursuant to 

section 558.1 because he was uninvolved in both the daily 

operation of Hepta Run and the creation of the policies governing 
18

its operation and argues the trial court improperly found him 

liable “solely by virtue of his status as the sole owner” of HRT 

and Hepta Run. Tseng’s challenge to the trial court’s liability 

finding is belied by the record. As discussed, the trial court 

explicitly found Tseng’s testimony that he lacked knowledge of 

the business’s daily operations not credible. Further, the court 

stated it based its finding of personal liability not merely on 

Tseng’s status as owner and officer but also on the undisputed

testimony he had approved the policy establishing the method of

driver compensation. We agree with the trial court an owner’s or 

officer’s approval of a corporate policy that violates the Labor 

Code is sufficient to find that individual caused the Labor Code 

violation within the meaning of section 558.1. 

Only one published California case has addressed what acts 

are sufficient for a finding of personal liability under 

section 558.1. In Usher v. White (2021) 64 Cal.App.5th 883, our 

colleagues in Division One of the Fourth District considered 

whether personal liability could be imposed on a corporate officer 

who assisted with administrative and banking tasks but had no 

role in day-to-day operations or employment policies. After 

reviewing recent federal district court decisions, which generally 

had found an individual could not be liable under section 558.1 

simply by virtue of his or her status as an owner, director or 

officer but must have been “‘personally involved’ in the alleged 

violations” or “engaged in ‘individual wrongdoing’” (Usher, at 

pp. 895-896),

11 the Usher court concluded, “[T]o be held liable 

11 Cases discussed by the Usher court included Rios v. Linn 

Star Transfer, Inc. (N.D.Cal. Apr. 6, 2020, Nos. 19-cv-07009-JSC

et al.) 2020 U.S.Dist. Lexis 60270, at pages *14-15 and Plaksin v. 
19

under section 558.1, an ‘owner’ . . . must either have been 

personally involved in the purported violation of one or more of 

the enumerated provisions; or, absent such personal involvement, 

had sufficient participation in the activities of the employer, 

including, for example, over those responsible for the alleged 

wage and hour violations, such that the ‘owner’ may be deemed to 

have contributed to, and thus for purposes of this statute, 

‘cause[d]’ a violation.” (Id. at pp. 896-897.) The court further 

cautioned that whether an individual could be liable under 

section 558.1 “cannot be determined by any bright-line rule, as 

this inquiry requires an examination of the particular facts in 

light of the conduct, or lack thereof, attributable to the 

[individual].” (Id. at p. 897.) Turning to the case before it, the 

court held the individual defendant was not liable because the 

undisputed facts showed she had not participated in the relevant 

employment decisions. (Ibid. [“Shirley was never consulted 

about, or provided any guidance regarding, the classification of 

service technicians; played no role in the hiring of technicians; 

did not create, draft or contribute to the content of any of the 

independent contractor agreements utilized by White 

Communications; and did not sign any such agreements on behalf 

of the company”].)

We agree generally with Usher and the federal cases it

cited that, in order to “cause” a violation of the Labor Code, an 

individual must have engaged in some affirmative action beyond 

his or her status as an owner, officer or director of the 

corporation. However, that does not necessarily mean the 

Newsight Reality (C.D.Cal. Apr. 30, 2019, No. 2:19-cv-00458-

RGK-SS) 2019 U.S.Dist. Lexis 168063, at page *13.
20

individual must have had involvement in the day-to-day 

operations of the company, nor is it required the individual 

authored the challenged employment policies or specifically 

approved their implementation. But to be held personally liable 

he or she must have had some oversight of the company’s 

operations or some influence on corporate policy that resulted in 

Labor Code violations. 

The record in the present case amply supported the trial 

court’s finding Tseng “caused” the Labor Code violations within 

the meaning of section 558.1. It was undisputed Tseng was the 

sole owner and president of both HRT and Hepta Run, and he 

admitted he had approved the policy regarding payment of truck 

drivers that violated various provisions of the Labor Code. 

Although he testified he had no involvement in or knowledge of 

the business’s operations the trial court did not credit that 

testimony, justifying the conclusion Tseng knew how his drivers 

were paid (and not paid).

4. Hepta Run and Tseng’s Arguments Challenging the 

Sufficiency of the Evidence Have Been Forfeited

In their opening brief Hepta Run and Tseng present a 

convoluted, two-page argument that, while briefly suggesting 

error in the statement of decision and rearguing the federal 

preemption issue, appears to challenge the trial court’s judgment 

on substantial evidence grounds. However, despite pointing out 

that each of Espinoza’s 11 causes of action “has required 

elements that need to be established by a preponderance of the 

evidence,” in their opening brief Hepta Run and Tseng fail to

identify those elements or provide any legal argument explaining
21

how the evidence at trial was insufficient to support a finding 

those elements had been met.

12

 

Hepta Run and Tseng’s challenge to the sufficiency of the 

evidence to support the court’s ruling has been forfeited. (See 

Mansell v. Board of Administration (1994) 30 Cal.App.4th 539, 

545-546 [“‘an appellate brief “should contain a legal argument 

with citation of authorities on the points made. If none is 

furnished on a particular point, the court may treat it as waived, 

and pass it without consideration”’”].) They have failed to make 

even a minimum showing warranting consideration. (See 

Del Real v. City of Riverside (2002) 95 Cal.App.4th 761, 768 [“it is 

counsel’s duty to point out portions of the record that support the 

position taken on appeal”; “[t]he appellate court is not required to 

search the record on its own seeking error”]; Mansell, at pp. 545-

546 [it is not the proper function of court of appeal to search the 

record on behalf of appellants or to serve as “backup appellate 

counsel”].)

5. Hepta Run and Tseng’s Arguments Challenging the 

Amount of Damages Have Been Forfeited

Hepta Run and Tseng argue Espinoza’s damages 

calculations relied on inadmissible evidence and improper 

methodologies. However, Hepta Run and Tseng consented to the 

amount of damages awarded.

At the outset of the hearing on damages, Hepta Run and 

Tseng’s counsel requested a recess to discuss the damage 

amounts with Espinoza’s counsel. After the recess Espinoza’s 

counsel informed the court the parties had agreed to a small 

reduction in the amount requested and would stipulate to 

12 Hepta Run and Tseng did not file a reply brief.
22

damages of $62,710.81, plus interest of $15,901.53, for which 

Hepta Run and Tseng would be jointly liable and an additional 

$3,973.28, plus interest of $1,530.11, for which Hepta Run was 

separately liable. The trial court asked Hepta Run and Tseng’s 

counsel, “So based on stipulation, you’re still contesting liability. 

Assuming liability is upheld, you’re stipulating to the numbers in 

terms of damages, correct?” Counsel replied, “That’s correct, your 

honor.” The court then read the amounts and asked counsel 

again if he stipulated to those amounts. Counsel replied that he 

did. Judgment was later entered in the amount stated on the 

record. Appellants’ opening brief fails to address the stipulation, 

and they declined to file a reply brief.

Having stipulated to the amount of damages, Hepta Run 

and Tseng have forfeited their claim of error. (See People v. 

Seumanu (2015) 61 Cal.4th 1293, 1328 [“‘when a party enters 

into a voluntary stipulation, he generally is precluded from 

taking an appeal claiming defects in the stipulation’”]; People v. 

Gurule (2002) 28 Cal.4th 557, 623 [same]; In re Marriage of 

Freeman (1996) 45 Cal.App.4th 1437, 1452 [same].)

DISPOSITION

We reverse the judgment as to the fifth and sixth causes of 

action and reverse the order denying summary adjudication on 

those causes of action. In all other respects, we affirm. On 

remand, the trial court is directed to grant the motion for 

summary adjudication, redetermine the proper damage award on 
23

the remaining causes of action on which Espinoza prevailed and 

enter a modified judgment in accordance with this opinion. The 

parties are to bear their own costs on appeal.

PERLUSS, P. J.

We concur:

SEGAL, J.

FEUER, J.