Court Opinion

ID: 9927789
Source: CourtListenerOpinion
Date Created: 2024-01-29 23:02:08.416136+00
Date Added: 2024-06-11T09:25:17.021786
License: Public Domain

Filed 1/29/24 Wang v. McKeirnan CA2/3
   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions
not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                         SECOND APPELLATE DISTRICT

                                      DIVISION THREE

 JIMMY WANG,                                                    B324442

           Plaintiff and Appellant,                             Los Angeles County
                                                                Super. Ct. No. 21STCP03084
           v.

 ROBERT McKEIRNAN,

           Defendant and Respondent.

     APPEAL from a judgment of the Superior Court of
Los Angeles County, Robert S. Draper, Judge. Affirmed.

      Law Office of Michael DesJardins and Michael DesJardins
for Plaintiff and Appellant.

     Cepkinian-Cinar Law and Jibit Cinar for Defendant
and Respondent.
                 _________________________
      The Labor Commissioner awarded Robert McKeirnan
$41,013.47 against Jimmy Wang, the Chief Financial Officer
(CFO) of McKeirnan’s former employer. Wang appealed the
decision to the superior court. After conducting a trial de novo,
the court found Wang refused to pay McKeirnan’s wages using
the proceeds from the sale of a company asset that McKeirnan
had arranged. Based on that finding, the court concluded Wang
was personally liable for McKeirnan’s unpaid wages under Labor
Code section 558.1, and it affirmed the Labor Commissioner’s
award. On appeal, Wang contends the court’s decision is not
supported by substantial evidence. We disagree and affirm
the judgment.
       FACTUAL AND PROCEDURAL BACKGROUND
1.    The Labor Commissioner’s decision
      McKeirnan filed a complaint with the Labor Commissioner
against his former employer and its CFO, Jimmy Wang. The
Labor Commissioner held a hearing and awarded McKeirnan
$169,982.80. Of that amount, the Labor Commissioner
determined Wang was personally liable for $41,013.47. The
award against Wang consisted of $12,408 in unpaid wages under
Labor Code section 1194, $26,538.60 in waiting time penalties
under Labor Code section 203, and $2,066.87 in interest under
Labor Code section 98.1.
2.    Wang appeals to the superior court
      Wang appealed the Labor Commissioner’s decision to the
superior court. The court held a two-day trial de novo, at which
McKeirnan presented evidence showing the following:
      McKeirnan’s former employer, HK Battery Technology, Inc.
(HK Battery), was a subsidiary of Hybrid Kinetic Group, LTD
(HK Group). HK Group was in the business of designing,

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manufacturing, and selling cars. Benjamin Yeung was the
largest shareholder of HK Group and the chairman of its board.
He also was the CEO of American Compass, Inc. (American
Compass), another subsidiary of HK Group. Benjamin’s son,
Carter Yeung, was the CEO of a different subsidiary and acted
as a “conduit” for his father throughout the various HK Group
companies.1
       Wang was the CFO of HK Battery and American Compass.
As HK Battery’s CFO, he was involved in the day-to-day
financial operations of the company. Among other things,
he was responsible for processing payroll, paying invoices, and
reimbursing business expenses. To cover payroll expenses, Wang
would transfer funds from American Compass to HK Battery.
He would then instruct a third-party payroll company to issue
paychecks to HK Battery employees. Wang also had access
to HK Battery’s bank accounts and had the authority to write
checks on its behalf for up to $100,000.
       HK Battery hired McKeirnan to lead an engineering
team in its micro-turbine unit. While working in that position,
McKeirnan arranged the purchase of a research vehicle—called
the Blackbird—for his team to use to develop an extended-range
electric vehicle. American Compass—or possibly a different
HK Group subsidiary—bought the Blackbird from Richard
Hillman for $70,000. As a condition of the sale, Hillman had the
right to repurchase the car if it was put up for sale in the future.
After the sale, the car was registered to American Compass.
       HK Battery and American Compass ran into financial
troubles in early 2019 and stopped paying their employees.

1     We occasionally refer to Benjamin Yeung and Carter Yeung
by their first names to avoid confusion.

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HK Battery’s CEO, Jason Xu, told McKeirnan the company
was seeking new investors, and he assured McKeirnan a new
source of funding was imminent. In the meantime, HK Group’s
chairman, Benjamin Yeung, decided to use company cars to help
cover payroll expenses. Employees with company cars were given
the option to keep or sell their cars, with the value being credited
against any unpaid wages.
       Around this time, McKeirnan came up with a plan to
sell the Blackbird to help cover payroll for himself and his team.
McKeirnan shared the plan with Brandon Keenan. Keenan
worked for a different subsidiary of HK Group, and he was
Carter Yeung’s assistant, best friend, and roommate.
       Keenan and Carter Yeung discussed McKeirnan’s plan
over text messages. In one message, Carter said his father,
Benjamin Yeung, had “given the ok” and wanted Keenan to talk
to Wang about the plan. Carter clarified the plan was to “[s]ell
the car and distribute funds to team for time being.” Keenan
could not recall whether he had that conversation with Wang,
but he said it was likely because he would not disobey a direction
from Carter.
       According to Wang, Keenan asked him for the title to the
Blackbird so McKeirnan could sell it. Wang “felt [McKeirnan’s]
project did not [need] to use” the Blackbird anymore, so he gave
the title to Keenan. Wang said he personally made the decision
to sign over the title to Keenan; no one had instructed him to
do so.
       McKeirnan apparently spoke to Hillman, who agreed to
repurchase the Blackbird on the condition that the funds be
used to cover HK Battery’s payroll expenses. Hillman wrote

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a $70,000 check made out to American Compass, which he gave
to McKeirnan.
       At some point, Wang asked Keenan for Hillman’s check.
Keenan said McKeirnan had the check and wanted the proceeds
to go to his team. Wang responded that it was “not a good idea”
because it would be unfair and illegal to distribute the funds only
to McKeirnan’s team. Keenan told Wang it was “out of my hands
on what to use [the check] for.”
       Around this time, Keenan sent McKeirnan a text message
relaying a conversation he had with Carter Yeung. Kennan
said Yeung had “told me to call Jimmy [Wang] today to talk
to him about the check as it’s already been communicated to him
per the chairman.” Keenan could not recall whether he ended up
having that conversation with Wang, but he noted he had no
reason to disobey Carter’s instruction.
       In October 2019, McKeirnan and Keenan drafted a
document called the “Blackbird Terms of Resale,” which the court
entered into evidence without objection. McKeirnan and Keenan
created the document so HK Battery’s executive team could
confirm and validate the terms of the sale to Hillman. They also
wanted to document the reason the funds had not been used
for payroll.
       The document states, “Approval was received to sell the
[Blackbird] and it was agreed that the proceeds would be applied
to aid the team’s payroll compensation.” Hillman “agreed he
would purchase the [Blackbird] under the condition that all of
the funds from the sale were to be used to aid the team’s payroll.”
However, “[t]he funds, per the instruction of Jimmy Wang (CFO),
cannot be used legally to selectively compensate individual
team members as per the payroll structure of HK [Battery].”

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To resolve this issue, the document proposed that McKeirnan’s
team receive discretionary bonuses totaling the sale price. The
document offered to relinquish the funds from the sale if someone
with the requisite authority agreed to use the funds in that
manner.
      Keenan gave the document to Carter Yeung, who
reportedly gave it to Wang. According to Keenan, Wang could
have signed the agreement.
      At some point, McKeirnan gave Hillman’s check to Keenan.
Keenan testified that McKeirnan would have given Wang the
check if Wang had agreed to give the funds to McKeirnan’s team.
However, Wang apparently never agreed, so Keenan and
McKeirnan never turned over the check.
3.    The court affirms the Labor Commissioner’s award
      The court issued a statement of decision affirming the
Labor Commissioner’s award. The court found Wang was
the CFO of HK Battery and actively involved in its day-to-day
financial operations. It also found Wang was aware Benjamin
Yeung and Carter Yeung had approved the plan to use the
Blackbird funds to pay McKeirnan’s wages. The court noted that
if Wang had doubts about the approvals, he could have contacted
Benjamin Yeung and Carter Yeung for verification. Instead,
Wang unilaterally decided the funds could not be used for payroll.
The court concluded Wang’s decision caused a violation of the
Labor Code, for which he is personally liable to McKeirnan
under Labor Code section 558.1. Accordingly, the court denied
Wang’s appeal and entered judgment for McKeirnan.
      Wang timely appealed.

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                           DISCUSSION
       Wang’s sole argument on appeal is that there is insufficient
evidentiary support for the trial court’s determination that he
is liable under Labor Code section 558.1.
       We review a trial court’s factual findings in its statement
of decision—both express and implied—for substantial evidence.
(SFPP v. Burlington Northern & Santa Fe Ry. Co. (2004) 121
Cal.App.4th 452, 462.) “Where [the] statement of decision sets
forth the factual and legal basis for the decision, any conflict in
the evidence or reasonable inferences to be drawn from the facts
will be resolved in support of the determination of the trial court
decision.” (In re Marriage of Hoffmeister (1987) 191 Cal.App.3d
351, 358; Estate of Young (2008) 160 Cal.App.4th 62, 75–76.)
We must “ ‘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.” (Estate of Young, at p. 76.)
       Under Labor Code section 558.1, “[a]ny 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.” (Lab. Code, § 558.1, subd. (a).)
For purposes of section 558.1, persons “ ‘acting on behalf of
an employer’ ” are limited to owners, directors, officers, and
managing agents of the employer. (Id., subd. (b).) Absent

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personal involvement in a Labor Code violation, to be liable
under section 558.1, a person must have “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 [person] may be deemed
to have contributed to, and thus for purposes of this statute,
‘cause[d]’ a violation.” (Usher v. White (2021) 64 Cal.App.5th
883, 896–897.)
       Here, the trial court determined Wang is personally
liable under Labor Code section 558.1 because, as the CFO
of HK Battery, he unilaterally prevented the proceeds from
the sale of the Blackbird from being used to pay McKeirnan’s
wages. Wang does not meaningfully challenge the theory of
liability underlying the court’s decision. To the contrary, he
seems to concede he would be personally liable to McKeirnan
under Labor Code section 558.1 had he prevented McKeirnan
from receiving the proceeds from the sale of the Blackbird.
Nor does Wang challenge the Labor Commissioner’s
determination—which the trial court implicitly adopted—
that McKeirnan is entitled to unpaid wages, penalties, and
interest under Labor Code sections 98.1, 203, and 1194.
       Nevertheless, Wang contends the trial court erred because
there is no evidence that one of his superiors—such as Carter
Yeung or Benjamin Yeung—instructed him to pay McKeirnan’s
wages using the funds from the Blackbird sale. The trial court
rejected Wang’s contention, and rightly so. McKeirnan submitted
a text message in which Carter Yeung explicitly instructed
Keenan to talk to Wang about McKeirnan’s plan to sell the
Blackbird. Keenan asked Yeung to clarify what he should say
to Wang, and Yeung told him plainly: “Sell the car and distribute

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funds to [McKeirnan’s] team for [the] time being.” Although
Keenan could not recall whether he had that conversation
with Wang, he believed he likely did because he would not
“directly disobey something that Carter told me to do.”
       The record also contains evidence indicating Wang
discussed McKeirnan’s plan with Benjamin Yeung, who was
the chairman of HK Group and the CEO of American Compass,
which owned the Blackbird. McKeirnan introduced a text
message in which Keenan said he had been instructed to “call
[Wang] today to talk to him about the check [from the sale of
the Blackbird] as it’s already been communicated to him per
the chairman.” It is reasonable to interpret this to mean that,
at the time Keenan sent the message, Wang and Benjamin Yeung
had already discussed McKeirnan’s plan to use the proceeds
from the sale of the Blackbird for payroll. Wang did not object
to this evidence on hearsay grounds, so the trial court was free
to consider it for the truth of the matters asserted.
       Even if the text messages were inadmissible hearsay
or otherwise insufficient, Wang acknowledged discussing the
Blackbird sale with Keenan, including the fact that McKeirnan
wanted the proceeds to be used for payroll. Given Keenan was
Carter’s assistant, it is reasonable to infer he told Wang that
Carter had approved the plan. Moreover, because Carter was
known as the “conduit” for his father throughout HK Group and
its subsidiaries, it is reasonable to infer Wang understood that
Benjamin Yeung had approved the plan as well. To the extent
Wang remained uncertain, as the trial court aptly noted, he
easily could have contacted Carter Yeung or Benjamin Yeung
to verify that they had authorized the plan. Viewing this
evidence in the light most favorable to the judgment, the

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trial court reasonably could have found Wang had been
instructed to use the proceeds from the sale of the Blackbird
to pay McKeirnan’s wages, but he unilaterally refused to do so.
       Wang alternatively contends that, even if he had been
instructed to use the funds to pay McKeirnan’s wages, he
is not personally liable because he never received the check
from the sale. Once again, we disagree. Although McKeirnan
conceded he did not give Wang the check from the sale, the trial
court reasonably could have found that fact was not dispositive.
Wang does not dispute that McKeirnan received the requisite
approval to use the sale proceeds to pay his wages. Moreover,
Keenan testified that McKeirnan would have given the check
to Wang had he agreed to use the funds for payroll. Wang
refused, so McKeirnan declined to give up the check. Under
these circumstances, the court reasonably could have found
McKeirnan was justified in conditionally refusing to turn over
the check.
       Finally, Wang contends he is not personally liable
for McKeirnan’s unpaid wages because there is no evidence
he had authority over HK Battery’s employment decisions,
possessed the power to raise funds for the company, or persuaded
McKeirnan to work without pay. While all that may be true, it
is beside the point, as the trial court did not base its decision on
any of those issues. Instead, the court found Wang is personally
liable because he refused to use the proceeds from the Blackbird
sale to pay McKeirnan’s wages. For the reasons already
discussed, substantial evidence supports that finding.

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                        DISPOSITION
      We affirm the judgment. Robert McKeirnan is awarded his
costs on appeal.

     NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

                                    EGERTON, J.

We concur:

             LAVIN, Acting P. J.

             ADAMS, J.

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