Court Opinion

ID: 2732409
Source: CourtListenerOpinion
Date Created: 2014-09-11 21:00:31.552152+00
Date Added: 2024-06-11T12:39:54.969540
License: Public Domain

NOT FOR PUBLICATION

                    UNITED STATES COURT OF APPEALS                               FILED
                            FOR THE NINTH CIRCUIT                                SEP 11 2014

                                                                           MOLLY C. DWYER, CLERK
                                                                            U.S. COURT OF APPEALS

MARSHALL FIELD, individually and on              No. 12-16311
behalf of all others similarly situated,
                                                 D.C. No. 3:09-cv-05972-EMC
              Plaintiff - Appellant,

  v.                                             MEMORANDUM*

AMERICAN MORTGAGE EXPRESS
CORPORATION; GEVITY HR, INC.,

              Defendants - Appellees.

                    Appeal from the United States District Court
                      for the Northern District of California
                    Edward M. Chen, District Judge, Presiding

                      Argued and Submitted August 14, 2014
                            San Francisco, California

Before: TASHIMA, McKEOWN, and CLIFTON, Circuit Judges.

       Cherie Johnson and Maria Ignacio appeal the district court’s final judgment

following the denial of their motion to substitute as new plaintiffs and class

representatives in this putative class action. On appeal, Johnson and Ignacio

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
challenge the district court’s determination that their claims were barred by the

doctrine of res judicata. We have jurisdiction under 28 U.S.C. § 1291, and we

affirm.1

      As a threshold matter, we conclude that the district court neither disregarded

California res judicata law nor supplanted it with the federal common law.

Consistent with 28 U.S.C. § 1738 and our precedent, the district court

appropriately applied California res judicata principles, including the requirement

that there be a “final judgment on the merits.”

      In applying California’s res judicata law, the district court correctly

determined that Johnson’s and Ignacio’s respective claims were precluded. First,

Johnson’s state agency proceedings before the California Labor Commissioner

resulted in a final judgment on the merits and involved the same parties and claims

in this federal action. See MHC Fin. Ltd. P’ship v. City of San Rafael, 714 F.3d
1118, 1125 (9th Cir. 2013). Based on the evidence and testimony in the record, the

hearing officer in Johnson’s state agency proceedings determined that she was not

employed by Gevity and therefore eliminated Gevity as a party. Because none of

the parties appealed the hearing officer’s decision, the California Superior Court

      1
        We grant Johnson and Ignacio’s unopposed request for judicial notice.
See, e.g., Terenkian v. Republic of Iraq, 694 F.3d 1122, 1137 n.8 (9th Cir. 2012).

                                         -2-
entered judgment pursuant to California Labor Code § 98.2. That judgment “has

the same force and effect as . . . a judgment in a civil action,” and is therefore

entitled to res judicata effect. Cal. Lab. Code § 98.2(e); see also Post v.

Palo/Haklar & Assocs., 23 Cal. 4th 942, 947 (2000) (“If no party takes an appeal,

the commissioner’s decision will be deemed a judgment, final immediately and

enforceable as a judgment in a civil action.”).

       Ignacio’s state agency proceedings also resulted in a final judgment on the

merits and involved the same parties and claims in this federal action. See MHC

Fin. Ltd. P’ship, 714 F.3d at 1125. Ignacio admitted during her administrative

hearing that she lacked any factual or legal basis to hold Gevity liable for her

unpaid wages and “opted to withdraw her complaint against Gevity.” The hearing

officer therefore dismissed Gevity from the suit. Contrary to Ignacio’s contention,

this dismissal was not without prejudice because Ignacio knowingly and

affirmatively abandoned her claims against Gevity during her administrative

hearing. See Gagnon Co. v. Nev. Desert Inn, Inc., 45 Cal. 2d 448, 455 (1955)

(“[A] dismissal entered in open court pursuant to stipulation . . . is ordinarily

effective as a retraxit.”); Eulenberg v. Torley’s Inc., 56 Cal. App. 2d 653, 657

(1943) (“[W]here it affirmatively appears that the plaintiff intended to abandon the

action, . . . it is treated as a retraxit.”). As in Johnson’s case, none of the parties in

                                            -3-
Ignacio’s state agency proceedings appealed the hearing officer’s decision, and the

California Superior Court entered a judgment entitled to res judicata effect. See

Cal. Lab. Code § 98.2(e). We reject Ignacio’s post hoc attempts to retract her

express abandonment of her claims against Gevity and to unwind the state court’s

final judgment. Permitting Ignacio to do so under these circumstances would

encourage duplicative litigation, waste judicial resources, nullify the administrative

scheme established by California labor law, and run counter to the California

legislature’s purpose of “avoid[ing] recourse to costly and time-consuming judicial

proceedings.” Arias v. Kardoulias, 207 Cal. App. 4th 1429, 1434 (2012).

      AFFIRMED.

                                         -4-