FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

CESAR ANTONIO MORENO, an 

individual,

Plaintiff-Appellant,

v.

UTILIQUEST, LLC, a Georgia Limited 

Liability Company,

Defendant-Appellee.

No. 21-55313

D.C. No.

2:20-cv-03156-

AB-MRW

OPINION

Appeal from the United States District Court

for the Central District of California

Andre Birotte, Jr., District Judge, Presiding

Argued and Submitted January 12, 2022

Pasadena, California

Filed March 18, 2022

Before: A. WALLACE TASHIMA and MILAN D. 

SMITH, JR., Circuit Judges, and STEPHEN J. 

MURPHY, III,* District Judge.

Opinion by Judge Milan D. Smith, Jr.

* The Honorable Stephen Joseph Murphy, III, United States District 

Judge for the Eastern District of Michigan, sitting by designation.
2 MORENO V. UTILIQUEST

SUMMARY**

Labor Law

The panel affirmed the district court’s dismissal, as 

preempted by the National Labor Relations Act (“NLRA”), 

of Cesar Moreno’s wrongful termination lawsuit against his 

former employer, UtiliQuest, LLC.

Although the NLRA does not contain express 

preemption provisions, the Supreme Court held that two 

categories of state action are implicitly preempted: (1) laws 

that regulate conduct that is either protected or prohibited by 

the NLRA (Garmon preemption); and (2) laws that regulate 

in an area Congress intended to leave unregulated or 

controlled by the free play of economic forces (Machinists

preemption). UtiliQuest contends that Garmon preemption 

applied to Moreno’s claims related to his termination.

Moreno brought several California state law claims 

relating to his termination: intentional misrepresentation; 

fraud and deceit; whistleblowing retaliation; and wrongful 

termination in violation of public policy. The panel held that 

all of these claims arguably implicated NLRA sections 7 and 

8, and were subject to Garmon preemption.

The panel considered, and rejected, Moreno’s three 

arguments for why these claims were not subject to Garmon

preemption. First, he argued that even if his terminationbased claims implicated the NLRA, preemption was 

** This summary constitutes no part of the opinion of the court. It 

has been prepared by court staff for the convenience of the reader.
MORENO V. UTILIQUEST 3

inappropriate because of the compelling local interest 

underlying his claims. The panel held that the risk of 

interference with the National Labor Relations Board’s 

jurisdiction was sufficient to outweigh the state’s interest in 

Moreno’s claims, and Garmon preemption was appropriate. 

Second, Moreno argued that his grievances with UtiliQuest 

were personal in nature and lacked any element of 

“concerted activity” necessary to establish an NLRA 

violation. The panel rejected his contention and held that 

when Moreno received a raise and other employees did not, 

the NLRB could consider Moreno’s advocacy for his fellow 

co-workers to be “concerted activity.” Third, Moreno 

argued that he was a statutory supervisor exempt from the 

NLRA. The panel held that the NLRB could arguably 

consider Moreno an employee, rather than a supervisor.

Moreno also asserted wage and hour-related claims 

against UtiliQuest after his termination. The district court 

dismissed the claims for failure to state a claim. On January 

10, 2022, UtiliQuest informed this court of a class action 

settlement in California Superior Court. The class consisted 

of UtiliQuest employees who, like Moreno, used company 

vehicles to commute to and from worksites. As part of the 

settlement, class members released their wage and hour 

claims. Because Moreno did not opt out of the settlement, 

UtiliQuest argued these claims were moot. The panel held 

that the California Superior Court’s settlement judgment was 

entitled to full faith and credit. Applying the principles of 

claim preclusion, the panel affirmed the district court’s 

dismissal of Moreno’s wage and hour claims.
4 MORENO V. UTILIQUEST

COUNSEL

Joshua M. Mohrsaz (argued) and Edwin Pairavi, Pairavi 

Law, P.C., Los Angeles, California, for Plaintiff-Appellant.

Alex Meier (argued) and Jill A. Porcaro, Seyfarth Shaw 

LLP, Los Angeles, California, for Defendant-Appellee.

OPINION

M. SMITH, Circuit Judge:

Plaintiff Cesar Moreno appeals the district court’s 

dismissal of his lawsuit against his former employer, 

Defendant UtiliQuest. Moreno alleges that UtiliQuest 

promised him that if he convinced all of his fellow 

employees to “sign away” their union rights, they would 

each receive a ten percent raise. Once Moreno obtained 

signatures from his co-workers releasing their union rights, 

UtiliQuest gave him a ten percent raise. Moreno soon 

learned, however, that UtiliQuest did not give any other 

employees the promised raise. Moreno contends he was 

terminated after confronting his supervisors about 

UtiliQuest’s breach of its promise.

Moreno brought various claims related to his 

termination, but the district court dismissed them because it 

found that they were preempted by the National Labor 

Relations Act (NLRA), 29 U.S.C. § 151 et seq. Moreno also

appeals the dismissal of his wage and hour claims, but as his 

appeal was pending, the Superior Court of California entered 

judgment on a final settlement precluding these claims. We 

affirm the district court’s dismissal of Moreno’s complaint.
MORENO V. UTILIQUEST 5

FACTUAL AND PROCEDURAL BACKGROUND

Moreno worked for UtiliQuest as a Field Technician 

from 2007 until 2018. At the time he was terminated, 

Moreno was a Lead Field Technician “responsible for

supervising the work of field technicians” on job sites. 

Moreno alleges that in June 2017, UtiliQuest’s management 

asked him to collect signatures from “all other employees” 

to “release their [union] rights” in exchange for a ten percent 

raise “in their hourly pay per year” for all who signed.

Moreno and the other employees each signed “the union 

release” in June 2017. UtiliQuest gave Moreno a ten percent

raise but did not give a raise to his fellow employees. On 

multiple occasions, Moreno complained to his managers

about his co-workers not receiving the promised raises. He 

alleges that UtiliQuest retaliated against him because of his 

advocacy on behalf of the other employees. On February 13, 

2018, Moreno contends that someone in Human Resources

falsely accused him of taking money from other employees 

in exchange for providing them with overtime hours. On 

February 28, 2018, Moreno’s manager fired him without 

explanation.

Moreno brought several state law claims related to his 

termination. Moreno also asserted wage and hour-related 

claims against UtiliQuest after his termination. He contends 

that UtiliQuest did not provide him with compensation for 

travel time between his home and the first and last job sites 

for the day. Moreno also alleges that the nature of his job 

responsibilities, together with UtiliQuest’s policies, 

prevented him from taking an “uninterrupted 30 minute meal 

break.”

The district court held that the NLRA preempted 

Moreno’s termination claims and dismissed them. The 

district court also dismissed Moreno’s wage and hour claims 
6 MORENO V. UTILIQUEST

pursuant to Federal Rule of Civil Procedure 12(b)(6) because 

he failed to state a cause of action. Moreno appealed.

On January 10, 2022—two days before oral argument in 

our court—UtiliQuest informed us of a class action 

settlement in California Superior Court that was finalized on 

November 29, 2021. The California class consisted of 

UtiliQuest employees who, like Moreno, used company 

vehicles to commute to and from worksites. As part of the 

settlement, class members released their wage and hour 

claims. Because Moreno did not opt out of the California 

settlement, UtiliQuest argued that the wage and hour claims 

portion of Moreno’s appeal was moot. We ordered, and have 

now received, supplemental briefing on this issue.

JURISDICTION AND STANDARD OF REVIEW

We have jurisdiction pursuant to 28 U.S.C. § 1291. We 

review de novo the district court’s dismissal pursuant to

Federal Rule of Civil Procedure 12(b)(6) for failure to state 

a claim. Okwu v. McKim, 682 F.3d 841, 844 (9th Cir. 2012) 

(citing AE ex rel. Hernandez v. County of Tulare, 666 F.3d 

631, 636 (9th Cir. 2012)). In reviewing a motion to dismiss, 

we accept as true all factual allegations in the complaint and 

draw all reasonable inferences in favor of the nonmoving 

party. Silvas v. E*Trade Mortg. Corp., 514 F.3d 1001, 1003 

(9th Cir. 2008).

ANALYSIS

I.

The NLRA does not contain express preemption 

provisions, but the Supreme Court held that “two categories 

of state action are implicitly preempted: (1) laws that 

regulate conduct that is either protected or prohibited by the 
MORENO V. UTILIQUEST 7

NLRA (Garmon preemption), and (2) laws that regulate in 

an area Congress intended to leave unregulated or 

‘controlled by the free play of economic forces’ (Machinists

preemption).” Interpipe Contracting, Inc. v. Becerra, 898 

F.3d 879, 887 (9th Cir. 2018) (quoting Chamber of Com. of 

the U.S. v. Brown, 554 U.S. 60, 65 (2008)). UtiliQuest 

contends that Garmon preemption applies to Moreno’s 

claims.

Sections 7 and 8 of the NLRA provide a private cause of 

action for claims “based on the conduct of labor 

organizations or their agents that constitute unfair labor 

practices.” Retail Prop. Tr. v. United Bhd. of Carpenters & 

Joiners of Am., 768 F.3d 938, 950 (9th Cir. 2014). 

Specifically, NLRA Section 7 protects the right of 

employees “to form, join, or assist labor organizations, to 

bargain collectively through representatives of their own 

choosing, and to engage in other concerted activities for the 

purpose of collective bargaining or other mutual aid or 

protection.” 29 U.S.C. § 157. Section 8 bars unfair labor 

practices by employers and labor organizations and also 

makes it illegal “for an employer to interfere with, restrain, 

or coerce employees in the exercise of the rights guaranteed 

in section [7 of the NLRA].” Id. at § 158(a)–(b).

“When an activity is arguably subject to § 7 or § 8 of the 

Act, the States as well as the federal courts must defer to the 

exclusive competence of the National Labor Relations Board

if the danger of state interference with national policy is to 

be averted.” San Diego Bldg. Trades Council v. Garmon, 

359 U.S. 236, 245 (1959). Garmon’s central concern “is the 

potential for conflict with federal policy.” Retail Prop. Tr., 

768 F.3d at 952. The Supreme Court acknowledged that it 

is not always clear whether a particular activity is preempted, 

but “[e]ven when a court is unsure,” it should leave the 
8 MORENO V. UTILIQUEST

determination to the National Labor Relations Board

(NLRB). Bassette v. Stone Container Corp., 25 F.3d 757, 

760 (9th Cir. 1994) (citing Garmon, 359 U.S. at 244–45).

Moreno brought several California state law claims 

relating to his termination: intentional misrepresentation

(Count 7); fraud and deceit (Count 8); whistleblowing 

retaliation (Counts 9 & 10); and wrongful termination in 

violation of public policy (Count 11). In connection with 

Garmon preemption, “[i]t is not the label affixed to the cause 

of action under state law that controls the determination of

the relationship between state and federal jurisdiction.” 

United Ass’n of Journeymen & Apprentices v. Borden, 373 

U.S. 690, 698 (1963). In Borden the Supreme Court held 

that plaintiff’s claims were preempted even though his

complaint “sounded in contract as well as in tort” because

the “facts as alleged in the complaint, and as found by the 

jury,” could arguably support a finding that the conduct 

violated the NLRA. Id. at 694, 698. As the district court 

correctly found here, all of Moreno’s claims arguably 

implicate NLRA Sections 7 and 8 and are subject to Garmon

preemption.

Moreno’s intentional misrepresentation and fraud claims 

are both treated the same under California law. Compare

Lazar v. Superior Court, 909 P.2d 981, 984–85 (Cal. 1996),

with Tenet Healthsystem Desert v. Blue Cross of Cal., 199 

Cal. Rptr. 3d 901, 914–15 (Ct. App. 2016). The elements of 

a fraud or intentional misrepresentation claim are: 

(1) misrepresentation, (2) knowledge of falsity, (3) intent to 

defraud or induce reliance, (4) justifiable reliance, and 

(5) damage. Lazar, 909 P.2d at 984. Moreno’s underlying 

theory for both counts is that UtiliQuest deceived him into 

convincing other employees to sign away their union rights

for a ten percent raise. What Moreno alleges UtiliQuest 
MORENO V. UTILIQUEST 9

did—offering employees a benefit to give up their union 

rights—is a textbook NLRA violation. See 29 U.S.C. 

§§ 157, 158(a)(1).

Moreno’s fraud and misrepresentation claims deal not 

primarily with UtiliQuest’s alleged illegal conduct, but 

rather with the fact that UtiliQuest deceived him. In 

determining whether there is potential for conflict with the 

NLRA, however, we cannot ignore the subject of 

UtiliQuest’s alleged deception. The elements of 

misrepresentation and intent to defraud in the state law 

claims both touch on conduct clearly covered by the NLRA.

For example, a jury would need to determine whether 

UtiliQuest made the misrepresentation, and such a finding 

would strongly suggest an NLRA Section 8 violation.

Holding that Moreno’s fraud and misrepresentation 

claims are preempted reflects a logical extension of our 

holding in Milne Employees Ass’n v. Sun Carriers, Inc., 960 

F.2d 1401 (9th Cir. 1991). In Milne we considered whether 

the NLRA preempted a fraud claim. We concluded that 

because an employer’s alleged misrepresentations did not 

implicate the NLRA, the fraud claim survived Garmon

preemption. Id. at 1414–15. Here, UtiliQuest’s alleged 

misrepresentation would violate the NLRA and thus 

involves national labor policy. The challenged conduct 

could be seen as “an attempt on the part of [the employer] to 

interfere with the collective bargaining process or to 

diminish the union’s representative role.” Id. at 1415–16 

(quoting Wells v. Gen. Motors Corp., 881 F.2d 166, 171 (5th 

Cir. 1989)) (alteration in the original).

Moreno’s whistleblowing retaliation and wrongful 

termination claims are also preempted. Cal. Lab. Code 

§§ 98.6; 1102.5. To establish a prima facie whistleblowing 

case, a plaintiff must show that (1) he engaged in a protected 
10 MORENO V. UTILIQUEST

activity, (2) his employer subjected him to an adverse 

employment action, and (3) there is a causal link between the 

two. See St. Myers v. Dignity Health, 257 Cal. Rptr. 3d 341, 

352 (Ct. App. 2019). A California wrongful termination in 

violation of public policy claim “requires a showing that 

there has been a violation of a fundamental public policy 

embodied in statute.” Merrick v. Hilton Worldwide, Inc., 

867 F.3d 1139, 1150 (9th Cir. 2017).

Moreno’s central theory in his whistleblowing retaliation 

and wrongful termination claims is that he was terminated 

for advocating on behalf of his fellow employees after 

UtiliQuest refused to give them a promised raise. In 

Bassette, we held that an employee’s wrongful termination

claim against her employer was preempted because the 

employer’s alleged conduct arguably violated the NLRA. 

25 F.3d at 761. The same reasoning applies in this case 

because UtiliQuest’s conduct arguably violated the NLRA. 

Thus, there is clear potential for conflict between state law 

and federal policy. 

On appeal, Moreno advances three arguments for why 

his claims are not subject to Garmon preemption. He 

contends that the local interest exception to Garmon 

preemption applies, that his grievances lack the “concerted 

activity” element necessary for an NLRA claim, and that he 

is a statutory supervisor exempt from the NLRA. We 

address, and reject, each in turn.

A.

Moreno argues that even if his termination-based claims 

implicate the NLRA, preemption is inappropriate because of 

the compelling local interest underlying his claims. 

Although Garmon preemption is broad, one well-recognized 

exception is when a regulation “touches on interests so 
MORENO V. UTILIQUEST 11

deeply rooted in local feeling and responsibility that” 

preemption could not be inferred. Loc. 926, Int’l Union of 

Operating Eng’rs v. Jones, 460 U.S. 669, 676 (1983) (citing

Garmon, 359 U.S. at 243–44). State laws “of general 

applicability” can be enforced “even though aspects of the 

challenged conduct” are arguably covered by the NLRA. 

Sears, Roebuck & Co. v. San Diego Cnty. Dist. Council of 

Carpenters, 436 U.S. 180, 194–95 (1978). To determine 

whether this exception applies, courts are required to balance 

the state’s interest in protecting its citizens with the risk of 

interfering with the NLRB’s ability to adjudicate the 

controversy. Id. at 196–97.

In determining whether adjudicating a state claim risks 

interference with the NLRB’s jurisdiction, we inquire 

whether “the controversy presented to the state court is 

identical with that which could be presented to the Board.”

Belknap, Inc. v. Hale, 463 U.S. 491, 510 (1983). When 

controversies are identical, “a state court’s exercise of 

jurisdiction necessarily involves a risk of interference with 

the unfair labor practice jurisdiction of the Board.” Sears, 

Roebuck & Co., 436 U.S. at 197. Importantly, the claims

need not be identical, but rather the focus is on whether the 

“controversy presented” is identical. A finding of Garmon

preemption does not require “that a plaintiff have a certain 

remedy before the Board, or even that the Board will hear 

the claim in the first place.” Bassette, 25 F.3d at 759–60.

When we consider Moreno’s fraud and 

misrepresentation claims, we note that a state has a 

“substantial interest in protecting its citizens from 

misrepresentations that have caused them grievous harm.”

Belknap, 463 U.S. at 511. We also observe that it would be

irrelevant to the NLRB that UtiliQuest’s promise to Moreno 

was false—UtiliQuest’s alleged promise would likely 
12 MORENO V. UTILIQUEST

violate the NLRA regardless of its intent to honor its 

promise. In any event, the underlying controversy is 

substantially identical and the facts as alleged in Moreno’s 

complaint could support a finding that UtiliQuest violated 

the NLRA. See Borden, 373 U.S. at 694. The risk of 

interference with the NLRB’s jurisdiction is sufficient to 

preclude the state’s interest in combatting fraud. Garmon 

preemption is appropriate.

The risk of interference between Moreno’s 

whistleblowing and retaliation claims and NLRA-related 

conduct is even more extensive than with the fraud claims. 

Moreno alleges that UtiliQuest terminated him for 

advocating on behalf of his fellow employees for a promised 

ten percent raise. Such conduct arguably violates the NLRA. 

Of course, the state also has an interest in protecting its 

citizens from employers’ illegal actions, but the 

controversies presented in Moreno’s whistleblowing and 

retaliation claims are substantially identical.

B.

Moreno contends that his grievances with UtiliQuest 

were personal in nature and lacked any element of 

“concerted activity” necessary to establish an NLRA

violation. See NLRB v. City Disposal Sys. Inc., 465 U.S. 

822, 830–31 (1984). The term “concerted activit[y]” in 

Section 7 of the NLRA “embraces the activities of 

employees who have joined together in order to achieve 

common goals,” but can also include actions of a single 

employee. Id. Section 7 requires both “concert” and activity 

for “mutual aid or protection.” E.I. Du Pont De Nemours & 

Co. v. NLRB, 707 F.2d 1076, 1077–78 (9th Cir. 1983). The 

NLRA does not protect an employee acting alone to 

complain about an issue, even if the issue concerns mutual 

aid or protection. “[I]t is the backdrop of other group activity 
MORENO V. UTILIQUEST 13

that transforms it into concerted action.” Id. at 1079. Even 

if “the employees’ conduct constituted merely individual 

activity,” the NLRB would still be entitled to find that 

“individual actions were concerted to the extent they 

involved a ‘logical outgrowth’ of prior concerted activity.” 

NLRB v. Mike Yurosek & Son, Inc., 53 F.3d 261, 265 (9th 

Cir. 1995). This is so because “[t]he lone act of a single 

employee is concerted if it ‘stems from’ or ‘logically grew’ 

out of prior concerted activity.” Id.

The question before us is whether the “activity is 

arguably subject to § 7 or § 8 of the Act.” Garmon, 359 U.S. 

at 245. If conduct is “arguably” protected, the party claiming 

preemption must show that the NLRB could legally decide 

the case in its favor. Int’l Longshoremen’s Ass’n, v. Davis, 

476 U.S. 380, 395 (1986). “This is not a demanding 

standard.” Idaho Bldg. & Const. Trades Council v. Inland 

Pac. Chapter of Associated Builders & Contractors, 801 

F.3d 950, 965 (9th Cir. 2015). UtiliQuest must (1) “advance 

an interpretation of the [NLRA] that is not plainly contrary 

to its language and that has not been ‘authoritatively 

rejected’ by the courts or the [NLRB]” and (2) offer “enough 

evidence to enable the court to find that the [NLRB]

reasonably could uphold a claim based on such an 

interpretation.” Davis, 476 U.S. at 394–95 (quoting Marine 

Eng’rs v. Interlake S.S. Co., 370 U.S. 173, 184 (1962)).

UtiliQuest has met this burden. Although Moreno

contends that he acted on his own volition, the NLRB could 

reasonably find that his “individual actions were concerted 

to the extent they involved a ‘logical outgrowth’ of prior 

concerted activity.” Mike Yurosek & Son, Inc., 53 F.3d at 

265. Moreno convinced other employees to relinquish their 

union rights in exchange for a ten percent raise. When 

Moreno received a raise and other employees did not, the 
14 MORENO V. UTILIQUEST

NLRB could consider Moreno’s advocacy for his fellow coworkers to be “concerted activity.” 

C.

The parties also disagree about whether Moreno was a 

supervisor at the time of his termination. Section 2(3) of the 

NLRA excludes supervisors from the protections of the 

NLRA. 29 U.S.C. § 152(3). Therefore, if Moreno was a 

statutory supervisor, his claims would not be preempted 

because he could not bring them before the NLRB. The 

NLRA defines a supervisor as one who (1) has authority to 

engage in certain supervisory functions defined in the Act,

1

(2) uses independent judgment when exercising this 

authority, and (3) holds this authority in the interest of the 

employer. NLRB v. Ky. River Cmty. Care, Inc., 532 U.S. 

706, 713 (2001). We need not determine whether Moreno 

was a supervisor. Rather, the relevant question is whether 

he “was arguably an employee, rather than a supervisor.”

Davis, 476 U.S. at 394.

Moreno contends that as Lead Field Technician, he was 

a supervisor responsible for “assigning all work to the field 

technicians and managing all of the work orders.” The 

district court rejected Moreno’s supervisor argument 

because it found his allegations in the complaint conclusory. 

Because UtiliQuest had the burden to show that the NLRB 

could legally decide that Moreno was an employee, the 

district court erred in its reasoning. See Chamber of Com. of 

the U.S. v. City of Seattle, 890 F.3d 769, 795 (9th Cir. 2018). 

1 Supervisory functions are defined as the power “to hire, transfer, 

suspend, lay off, recall, promote, discharge, assign, reward, or discipline 

other employees, or responsibility to direct them, or to adjust their 

grievances.” 29 U.S.C. § 152(11).
MORENO V. UTILIQUEST 15

“Nevertheless, we may affirm based on any ground 

supported by the record.” Johnson v. Riverside Healthcare 

Sys., LP, 534 F.3d 1116, 1121 (9th Cir. 2008).

UtiliQuest’s motion to dismiss included notices of 

election from the NLRB, which are public records subject to 

judicial notice. See Santa Monica Food Not Bombs v. City 

of Santa Monica, 450 F.3d 1022, 1025 n.2 (9th Cir. 2006). 

The notices reveal that in two prior California union 

elections involving UtiliQuest’s workforce, the NLRB 

determined that Lead Technicians fall within the collective 

bargaining unit. As UtiliQuest admits, these records are not 

conclusive proof as to what the NLRB would decide in 

Moreno’s case, but readily meet the burden to show that the 

NLRB would “arguably” consider Moreno an employee.

II.

The Full Faith and Credit Act, 28 U.S.C. § 1738, “directs 

all courts to treat a state court judgment with the same 

respect that it would receive in the courts of the rendering 

state.” Matsushita Elec. Indus. Co. v. Epstein, 516 U.S. 367, 

373 (1996). The California Superior Court’s settlement 

judgment is entitled to full faith and credit. Applying the 

principles of claim preclusion, we affirm the district court’s 

dismissal of Moreno’s wage and hour claims.

The Supreme Court’s decision in Matsushita, controls 

the outcome here. Id. In Matsushita, the plaintiffs appealed 

a summary judgment dismissal to our court. Id. at 370. 

While the appeal was pending, a related state court class 

action settlement was finalized. Id. at 370–71. The federal 

appellants had not opted out of the class, and the settlement

explicitly released their federal claims that were on appeal 

before this court. Id. at 371–72. The Supreme Court later 

reversed our court for not applying the Full Faith and Credit 
16 MORENO V. UTILIQUEST

Act as a bar to further prosecution of the federal action. Id.

at 373. The same principle applies here. As Moreno’s 

federal case was pending appeal, the Los Angeles County 

Superior Court entered a final settlement order and judgment 

that bars his wage and hour claims.2

Our court must treat a state court judgment with the same 

respect it would receive in the courts of the rendering state. 

28 U.S.C. § 1738. We apply California law to determine a 

judgment’s preclusive effect. See Manufactured Home 

Cmtys. Inc. v. City of San Jose, 420 F.3d 1022, 1031 (9th 

Cir. 2005). In California, claim preclusion applies when

“(1) the decision in the prior proceeding is final and on the 

merits; (2) the present proceeding is on the same cause of 

action as the prior proceeding; and (3) the parties in the 

present proceeding or parties in privity with them were 

parties to the prior proceeding.” Fed’n of Hillside & Canyon 

Ass’ns v. City of Los Angeles, 24 Cal. Rptr. 3d 543, 557 (Ct. 

App. 2004).

All three elements of claim preclusion are satisfied here. 

On November 29, 2021, the California Superior Court

entered an order granting final settlement approval in 

Garcia-Muniz v. UtiliQuest, LLC. See Order Granting 

Motion for Final Approval of Class Action Settlement, No. 

BC685160 (L.A. Super. Ct. Nov. 29, 2021). The judgment 

was entered on December 1, 2021. Final Judgment, GarciaMuniz v. UtiliQuest, LLC, No. BC685160 (L.A. Super. Ct. 

2 Although preclusion is an affirmative defense, not a jurisdictional 

matter, we are nonetheless bound to recognize the preclusive effects of a 

state court judgment. See Exxon Mobil Corp. v. Saudi Basic Indus. 

Corp., 544 U.S. 280, 293 (2005). This affirmative defense was not—

and could not have been—raised in district court, but we exercise our 

discretion to consider it for the first time on appeal. See United States v. 

Patrin, 575 F.2d 708, 712 (9th Cir. 1978). 
MORENO V. UTILIQUEST 17

Dec. 1, 2021). Under California law, “[a] court-approved 

settlement” constitutes a final judgment on the merits,

Consumer Advoc. Grp., Inc. v. ExxonMobil Corp., 86 Cal. 

Rptr. 3d 39, 54 (Ct. App. 2008), but a judgment is not final 

“if an appeal is pending or could still be taken.” Riverside 

Cnty. Transport. Comm’n v. S. Cal. Gas Co., 268 Cal. Rptr. 

3d 196, 208 (Ct. App. 2020); see also Franklin & Franklin 

v. 7-Eleven Owners for Fair Franchising, 102 Cal. Rptr. 2d 

770, 774 (Ct. App. 2000).

As part of the settlement agreement, the parties in

Garcia-Muniz v. UtiliQuest, LLC, agreed to waive any 

appeals unless the California Superior Court entered an order 

that materially altered the settlement’s terms. The Superior 

Court subsequently entered a final judgment “in accordance 

with terms of the Settlement.” Final Judgment at 1, GarciaMuniz, No. BC685160. Moreover, on January 30, 2022, the 

time to appeal California’s judgment lapsed, and so the 

judgment is final and free from “direct attack.”3 People v. 

Burns, 131 Cal. Rptr. 3d 121, 125 (Ct. App. 2011). Moreno 

does not contest that the settlement releases cover his wage 

and hour claims. Moreno also admits that he received notice 

of the class settlement and did not opt out within the 

timeframe. Accordingly, there is a final judgment on the 

merits involving the same parties and same cause of action. 

Moreno’s wage and hour claims are precluded.

Moreno argues that he implicitly opted out of the state 

settlement by maintaining this federal litigation, and in the

3 As an absent class member, Moreno must have formally intervened 

or filed a motion to vacate the judgment and been denied relief to have 

the right to appeal the Superior Court’s judgment. Hernandez v. 

Restoration Hardware, Inc., 409 P.3d 281, 290 (Cal. 2018). He did 

neither. Nor has Moreno, after two rounds of supplemental briefing on 

this subject, expressed any intent to appeal the California settlement. 
18 MORENO V. UTILIQUEST

alternative, requests permission to file a late opt out. He 

raises these issues in the wrong court. A federal court’s

broad collateral review of a state court class action judgment 

would be inappropriate. Hesse v. Sprint Corp., 598 F.3d 

581, 587 (9th Cir. 2010). Our review is limited to

determining “whether the procedures in the prior litigation 

afforded the party against whom the earlier judgment is 

asserted a ‘full and fair opportunity’ to litigate the claim or 

issue.” Id. (quoting Epstein v. MCA, Inc., 179 F.3d 641, 

648–49 (9th Cir. 1999)). “Normally we will satisfy 

ourselves that the party received the requisite notice, 

opportunity to be heard, and adequate representation by 

referencing the state court’s findings.” Id. at 588. The

Superior Court of California made specific findings that the 

notice given to class members comported with due process 

and that the settlement was fair, adequate, and reasonable.

See Order Granting Motion for Final Approval of Class 

Action Settlement at 9–11, Garcia-Muniz, No. BC685160. 

Accordingly, the district court’s dismissal of Moreno’s wage 

and hour claims is affirmed. 

CONCLUSION

For the foregoing reasons, we affirm the district court’s 

dismissal of Moreno’s complaint and action.

AFFIRMED.