Source: http://thecomplexlitigator.com/?offset=1482438185453&category=Class+Actions%3A++New+Opinions
Timestamp: 2019-04-24 12:11:49+00:00

Document:
Very briefly, I direct your attention to Veera v. Banana Repulic, LLC (December 15, 2016), decided by the California Court of Appeal (Second Appellate District, Division Four). In Veera, the Court examined the evidence necessary to create a triable issue of fact as to whether an advertisement of a sale resulted in an actionable economic injury caused by an unfair business practice.
The plaintiffs alleged that signs in Banana Republic store windows advertising a 40 percent off sale were false or misleading because they did not state that the discount applied only to certain items. The plaintiffs introduced evidence indicating that, in reliance on the allegedly false advertising, they were induced to shop at certain Banana Republic stores and selected various items for purchase at the advertised discount. However, as the items were being rung up at the cash register, they were told for the first time that the advertised discount did not apply to their chosen merchandise. The plaintiffs claimed that, after waiting in line to purchase the selected items, and due to frustration and embarrassment, they just bought some of the items they chose even though the discount did not apply. Applying Kwikset, the Court of Appeal concluded that this evidence was sufficient to create a triable issue and defeat summary judgment.
One Justice dissented in the result. The dissent raises the interesting question of whether lost opportunity costs and time are sufficient to create injury under the UCL and/or the FAL.
Appellants were represented by Jones, Bell, Abbott, Fleming & Fitzgerald, William M. Turner, Asha Dhillon; Grignon Law Firm, Anne M. Grignon and Margaret M. Grignon.
Appellants Nivida Lubin, Sylvia M. Maresca, and Kevin Denton (together plaintiffs) filed this action on behalf of themselves and similarly situated persons, alleging defendant and respondent The Wackenhut Corporation (Wackenhut) violated California labor laws by failing to provide employees with off-duty meal and rest breaks and by providing inadequate wage statements. The trial court initially granted plaintiffs’ motion for class certification. However, as the case approached trial, the United States Supreme Court reversed a grant of class certification in Wal-Mart Stores, Inc. v. Dukes (2011) 564 U.S. 338 (Wal-Mart). Relying on Wal-Mart, Wackenhut moved for decertification. The trial court granted the motion.
I don't have time to try and summarize this monster opinion at the moment, but it is a must read. The Court spends a lot of time explaining why Wal-Mart is not applicable to wage and hour certification questions, notes that the Supreme Court, which decided Wal-Mart, held this year in Tyson Foods, Inc. v. Bouaphakeo, ___ U.S. ___, ___, 136 S.Ct. 1036, 1048 (2016) that statistical evidence is appropriately used in class actions, spends a substantial amount of time applying Brinker and the cases that followed to explain that variations in rates of missed meal and rest breaks, when certified based on an unlawful policy or procedure, is a damages issue, not a predominance question, and lots, lots, more!
Weinberg, Roger & Rosenfeld, Emily P. Rich, Theodore Franklin, Manuel A. Boigues; Posner & Rosen, Howard Z. Rosen, Jason C. Marsili, Brianna M. Primozic; James R. Hawkings, James R. Hawkings, and Gregory E. Mauro, represented the successful Plaintiffs and Appellants on appeal.
Sep 21 2016: Consent to the filing of amicus curiae briefs, in support of either party or of neither party, received from counsel for petitioners.
Oct 3 2016: Brief amici curiae of National Association of Manufacturers, et al. filed. VIDED.
Oct 3 2016: Brief amicus curiae of Chamber of Commerce of the United States filed.
Oct 6 2016: Order extending time to file response to petition to and including November 14, 2016.
Oct 7 2016: Brief amicus curiae of International Association of Defense Counsel filed.
Oct 10 2016: Brief amicus curiae of Atlantic Legal Foundation filed.
Oct 11 2016: Brief amicus curiae of The Employers Group filed.
Oct 11 2016: Brief amicus curiae of The Retail Litigation Center, Inc. filed.
Oct 11 2016: Brief amicus curiae of The Business Roundtable filed.
Oct 11 2016: Brief amicus curiae of New England Legal Foundation filed.
Nov 15 2016: Order further extending time to file response to petition to and including November 21, 2016.
Nov 21 2016: Brief of respondents Stephen Morris, et al. in opposition filed.
Just look at those busy amicus filers. I bet all those employers are telling the Supreme Court that the world would end in fire and death if they couldn't block class actions for wage and hour violations with arbitration agreements that employees have to sign to work.
Ninth Circuit begins to define scope of Mazza in Ruiz Torres v. Mercer Canyons Inc.
In Mazza v. Am. Honda Motor Co., 666 F.3d 581 (9th Cir. 2012), the Ninth Circuit Rule 23 predominance was defeated where many (or even most) class members “were never exposed to the allegedly misleading advertisements” (666 F.3d at 597) because the defendant subjected only a small segment of an expansive class of car buyers to misleading material as part of a “very limited” advertising campaign (id. at 595). This decision raised questions about how federal courts in the Ninth Circuit would actually evaluate UCL claims when faced with reconciling In re Tobacco II and Mazza. In Ruiz Torres v. Mercer Canyons Inc. (9th Cir. Aug. 31, 2016), a wage & hour suit in which the District Court certified a class, the Ninth Circuit analyzed Mazza in a manner demonstrating that it may be constrained in its application moving forward.
The Ninth Circuit, by virtue of geography, periodically has to rule on claims based upon California's consumer protection laws. In Ebner v. Fresh, Inc. (Sept. 27, 2016), the Ninth Circuit reviewed a District Court's dismissal with prejudice of a putative class action alleging that the defendant deceived consumers about the quantity of lip balm in the defendant's product line.
Law is driven as much by unforeseen consequences as it is by any rational planning. The Labor Code Private Attorneys General Act of 2004 (PAGA) is exhibit one. Over the last five or so years, inexorable advance of the Federal Arbitration Act looked as if it would cut a fatal swath through many class actions. But, somewhat unexpectedly, PAGA has served as a counterpoint in the wage & hour sector. In Perez v. U-Haul Co. of California (Sept. 16, 2016), the Second Appellate District, Division Seven, affirmed the trial Court's ruling that U-Haul could not assert an arbitration agreement to compel the plaintiffs to individually arbitrate whether they qualified as “aggrieved employee[s],” to determine in arbitration whether they had standing to pursue a PAGA claim.
The Court agreed with Williams v. Superior Court, 237 Cal. App. 4th 642 (2015), which also held that California law prohibits the enforcement of an employment agreement provision that requires an employee to individually arbitrate whether he or she qualifies as an “aggrieved employee” under PAGA, and then (if successful) to litigate the remainder of the “representative action in the superior court.” Slip op., at 11-12. The Court concluded by dismissively rejecting the notion that the FAA can apply to claim belonging to a governmental entity or its designated proxy.
Gregg A. Farley, of the Law Offices of Gregg A. Farley, and Sahag Majarian, of the Law Offices of Sahag Majarian, represented Plaintiff and Respondent Sergio Lennin Perez; Larry W. Lee and Nicolas Rosenthal. of the Diversity Law Group, and Sherry Jung, of the Law Offices of Sherry Jung, represented Plaintiff and Respondent Erick Veliz.
Ninth Circuit examines arbitration and PAGA claims in Mohamed v. Uber Technologies, Inc.
The Ninth Circuit tackles a complicated set of arbitration issues in Mohamed v. Uber Technologies, Inc. (9th Cir. Sept. 7, 2016). Among other things, the panel held that the District Court erred when it decided the question of arbitrability, since the question of arbitrability was delegated under the agreement to an arbitrator. But the panel agreed that the defendants could not compel arbitration of the PAGA claim asserted in the case, severing that claim for further proceedings in before the trial court. Finally, the panel agreed that a separate defendant not party to the arbitration agreement could not assert a right to enforce the agreement as an agent of Uber.
Allstate tests new method for mooting class claims; falls short in Chen v. Allstate Ins. Co.
Normal people see laws as barriers. Lawyers see laws as an agility course. After Pitts v. Terrible Herbst, Inc., 653 F.3d 1081 (9th Cir. 2011) and Gomez v. Campbell-Ewald Co., 768 F.3d 871 (9th Cir. 2014), aff’d, 136 S. Ct. 663 (2016), you'd have to forgive ordinary citizens for thinking that the question of whether you can moot a class action by offering up full individual relief to the putative class representative was pretty well settled. But where some see finality, Allstate insurance saw...opportunity. Specifically, Allstate looked to Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663 (2016) for the secret to mooting class representative claims. In Chen v. Allstate Inc. Co. (9th Cir. Apr. 12, 2016), the Ninth Circuit sent the wily insurance coyote back to the drawing board.
The plaintiffs filed a class action complaint against Allstate, alleging he received unsolicited automated telephone calls to his cellphone, in violation of the Telephone Consumer Protection Act (TCPA). Before a motion for class certification had been made, Allstate made an offer of judgment to the plaintiffs under Rule 68 of the F.R.C.P., depositing $20,000 in full settlement of individual monetary claims in an escrow account “pending entry of a final District Court order or judgment directing the escrow agent to pay the tendered funds to Pacleb, requiring Allstate to stop sending non-emergency telephone calls and short message service messages to Pacleb in the future and dismissing this action as moot.” Slip op. at 4, 7. Allstate extended the Rule 68 offer beyond 14 days and then moved for entry of judgment and dismissal. One plaintiff accepted the offer while the motion was pending.
The district court denied the motion, holding that, under Pitts v. Terrible Herbst, Inc., 653 F.3d 1081 (9th Cir. 2011), the plaintiff's class allegations presented a justiciable controversy and rejected the notion that Pitts was no longer good law. The district court later certified the issue for interlocutory appeal.
On appeal, Allstate asked the Court to take up the hypothetical issue raised in Campbell-Ewald, which was whether the deposit of the full amount of a plaintiff's individual claim in an account payable to the plaintiff, followed by entry of judgment for the plaintiff in that amount, is sufficient to moot the case. Allstate argued that the judgment it consented to would offer complete relief, the district should be compelled to enter judgment on those terms, mooting the plaintiff's individual claims, and the remaining class allegations would then be insufficient to preserve a live controversy. While the Court agreed with the first contention, it rejected the second and third contentions.
The Court began by reviewing the relief that Allstate had consented to in the district court. Considering both the monetary and injunctive aspects of that relief, the Court found that complete individual relief was offered. Slip op., at 12-14.
In Gomez, 768 F.3d at 875–76, however, we squarely rejected that very argument. Because Genesis Healthcare concerned collective actions brought under the Fair Labor Standards Act (FLSA) rather than class actions under Federal Rule of Civil Procedure 23, Gomez held Pitts was not clearly irreconcilable with Genesis Healthcare. See id. Although Genesis Healthcare “undermined some of the reasoning employed in Pitts . . . , courts have universally concluded that the Genesis discussion does not apply to class actions.” Id. at 875. “In fact, Genesis itself emphasizes that ‘Rule 23 [class] actions are fundamentally different from collective actions under the FLSA.’” Id. at 875–76 (alteration in original) (quoting Genesis Healthcare, 133 S. Ct. at 1529).
Slip op., at 16. The Court then held that it was bound by Gomez, which was decided en banc.
Next, the Court went further, holding that even if Pitts were not controlling, the Court would reject an attempt to moot the action prior to a fair opportunity to move for class certification. The Court noted that placing funds in an escrow account was not the same as the actual receipt of all relief by a plaintiff. This will likely just bait the next enterprising defendant into actually tendering the funds into an account in the name of the plaintiff to see if the outcome is any different (remember, there are no obstacles, only new paths).
Even if that is true, however, Campbell-Ewald clearly suggests it would be inappropriate to enter judgment under these circumstances. As Campbell-Ewald explained, “[w]hile a class lacks independent status until certified, a would-be class representative with a live claim of her own must be accorded a fair opportunity to show that certification is warranted.” Campbell-Ewald, 136 S. Ct. at 672 (emphasis added) (citation omitted) (citing Sosna, 419 U.S. at 399). Accordingly, when a defendant consents to judgment affording complete relief on a named plaintiff’s individual claims before certification, but fails to offer complete relief on the plaintiff’s class claims, a court should not enter judgment on the individual claims, over the plaintiff’s objection, before the plaintiff has had a fair opportunity to move for class certification.
Slip op., at 22-23. The Court noted the long-recognized principle that class relief is the only feasible relief in many circumstances and concluded that "a district court should decline to enter a judgment affording complete relief on a named plaintiff’s individual claims, over the plaintiff’s objection, before the plaintiff has had a fair opportunity to move for class certification." Slip op., at 26.
The Court affirmed the district court.
If you anticipate that the Supreme Court will take up the first case to test its Genesis Healthcare hypothetical, don't hold your breath. If anything, the Supreme Court would want to see more than one Circuit tackle the issue and see if a significant split develops before wading back into these waters. That doesn't mean that enterprising defendants won't look for another way to moot class claims before certification.
I can still remember when the first suitable seating cases were filed. I reckon' it happened right about the time that the wage & hour landscape became unsettled in the meal period and rest break areas, class certification decisions were all over the place prior to Brinker, and PAGA claims were getting a long look as an alternative and supplemental approach to class claims. The suitable seating cases went through an initial wave of appellate court analysis, but, without California Supreme Court guidance on the issue, federal courts were left to speculate about what the California Supreme Court would say on the matter. The Ninth Circuit addressed that lack of clarity by certifying questions to the California Supreme Court. In Kilby v. CVS Pharmacy, Inc. (April 4, 2016), the California Supreme Court answered those questions.
(1) Does the phrase “nature of the work” refer to individual tasks performed throughout the workday, or to the entire range of an employee’s duties performed during a given day or shift?
(2) When determining whether the nature of the work “reasonably permits” use of a seat, what factors should courts consider? Specifically, are an employer’s business judgment, the physical layout of the workplace, and the characteristics of a specific employee relevant factors?
(3) If an employer has not provided any seat, must a plaintiff prove a suitable seat is available in order to show the employer has violated the seating provision?
(1) The “nature of the work” refers to an employee’s tasks performed at a given location for which a right to a suitable seat is claimed, rather than a “holistic” consideration of the entire range of an employee’s duties anywhere on the jobsite during a complete shift. If the tasks being performed at a given location reasonably permit sitting, and provision of a seat would not interfere with performance of any other tasks that may require standing, a seat is called for.
(2) Whether the nature of the work reasonably permits sitting is a question to be determined objectively based on the totality of the circumstances. An employer’s business judgment and the physical layout of the workplace are relevant but not dispositive factors. The inquiry focuses on the nature of the work, not an individual employee’s characteristics.
(3) The nature of the work aside, if an employer argues there is no suitable seat available, the burden is on the employer to prove unavailability.
Slip op., at 2. Before looking at any of the more interesting parts of the Court's discussion, we now know with certainty that suitable seating is a task-based, not a position-based, requirement. And I immediately concluded after reading this opinion that I wanted to start a business that specializes in making narrow and light barstool-style swivel chairs for cashiers in the retail and grocery sectors. That's where the real money is going to be found.
Defendants’ argument sweeps too broadly and is inconsistent with the purpose of the seating requirement. As discussed, the IWC’s wage orders were promulgated to provide a minimum level of protection for workers. The requirement’s history reflects a determination by the IWC that “humane consideration for the welfare of employees requires that they be allowed to sit at their work or between operations when it is feasible for them to do so.” (IWC, Statement of Findings by the Industrial Welfare Commission of the State of Cal. in Connection with the Revision in 1976 of its Orders Regulating Wages, Hours, and Working Conditions (Aug. 13, 1976) p. 15.) Defendants’ proposed consideration of all tasks included in an employee’s job description ignores the duration of those tasks, as well as where, and how often, they are performed. This all-or-nothing approach could deprive an employee of a seat because most of his job duties are classified as “standing” tasks, even though the duration, frequency, and location of the employee’s most common tasks would make seated work feasible while performing them. There is no principled reason for denying an employee a seat when he spends a substantial part of his workday at a single location performing tasks that could reasonably be done while seated, merely because his job duties include other tasks that must be done standing.
Slip op., at 14. The Court expressed concern that the all-or-nothing approach could result in a situation where two employees performing the same task could have different seating rights, based on the overall classification of their job. Yet, the Court also found the plaintiffs' position too narrow, focusing on a single task to determine if that one task could be performed seated. The Court found that focusing on the work done and the tasks performed in a location alleviated the problems created by both the defendants' approach and the plaintiffs' approach.
The Court then examined the "reasonably permits" portion of the seating requirements. The Court found that the employer's assessment of overall job performance (its business judgment) was a factor that could be considered, as was the physical layout of the workplace . These factors, however, must be considered "in light of the overall aims of the regulatory scheme, which has always been employee protection." The Court disagreed that differences between employees was a factor, since the regulation focused on the "work," and not the "worker."
Finally, the Court swiftly rejected the idea that a plaintiff must prove that a suitable seat is available, after showing that the nature of the work would reasonably permit the use of a seat.
The Court concluded by saying, "Sit on that." No, not really. But the Court was unanimous.

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