Workplace Investigations: When, Who, and How

Workplace investigations occur for several reasons. Some workplace investigations result from an employee complaint of discrimination, harassment claims, or wrongful termination. Others are mandated by regulatory procedures. Others, still, are instituted to improve workplace performance.

Regardless of the purpose of the investigation, how the investigation proceeds and what it entails shapes an employer’s response and can help reduce exposure to legal claims.

While the exact procedures differ based on the company, employees, the alleged conduct involved, and the investigator, there are certain overriding principles common in most investigations. If the investigation is faulty, any response to the complaint may suffer the same defects.


Investigations should occur promptly, to ensure the employer adequately responds to a complaint and to provide the best opportunity to obtain relevant information and preserve potential evidence. Employers must take all complaints seriously, and evaluate the appropriate scope of the investigation so it can take prompt action.  At a minimum, the investigator should interview the complainant, the accused, and all witnesses

In some instances, an employer is obligated to conduct an investigation even in the absence of an employee complaint. For example, if the employer “knows or should have known” of conduct that requires investigation, the employer can be held liable for failing to conduct an investigation.

When contemplating an investigation, the employer must also consider whether to take some form of interim relief pending the results of the investigation. This could include separating the complainant and the alleged perpetrator, suspending the alleged perpetrator, temporarily modifying reporting structures or other appropriate action.  The purpose of interim relief is to ensure no further misconduct occurs before the company has an opportunity to investigate and resolve the situation.


Several years ago, the California legislature passed a law restricting who could conduct a workplace investigation.  The purpose was to ensure the investigators were properly trained in how to conduct an effective investigation, and to protect employees lodging complaints in the workplace.  If the investigation is conducted by a person who is not employed by the company, the investigator must be a private investigator or a licensed attorney.  Internal investigations (i.e., conducted by an employee of the organization) do have to be conducted by private investigators or attorneys, but the person conducting the investigation should have the necessary skills and objectivity necessary to conduct an effective investigation.

When choosing who will conduct the investigation, start with someone who is objective, skilled, experienced, and with sufficient authority to be credible. Line managers are usually not sufficiently skilled to conduct a thorough investigation.  Additionally, if ultimate decision maker is influenced by others who had retaliatory motives, the investigation is not “independent”.  Many human resources personnel are qualified to conduct an investigation, but a human resources title does not guarantee the person has the training, skill and expertise necessary to do the job right.

A common question is whether an attorney should conduct the investigation.  Sometimes it is a good idea. Other times it is not. Attorneys are often trained in interviewing witnesses and testing credibility.  An attorney with litigation experience will have a better idea of the types of evidence that might be examined if a matter went to trial.  However, have the company’s corporate attorney conduct an investigation can also create a conflict of interests. The investigator will oftentimes be a witness if a matter proceeds to litigation, this could result in an unintentional waiver of the attorney-client privilege. As general rule, including lawyers in an internal investigation does not automatically insulate an investigation from disclosure.


Confidentiality and discretion are cornerstones of an effective investigation. Confidentiality is essential to protect the investigation and to help the participants feel comfortable disclosing information. Investigation records should be kept separate from other corporate or personnel records.

Investigation should be limited to a “need to know” basis. Only individuals who need to be involved in the investigation or in deciding the outcome should be kept apprised of the investigation’s progress.

Investigators cannot promise absolute confidentiality when interviewing witnesses or the complaining employee.  A thorough investigation will necessarily require revealing certain information.  Promising complete confidentiality can hurt the investigator’s ability to conduct an effective investigation.  Instead, the investigator should tell the complainant, the alleged perpetrator and any witnesses that the investigator will keep the information confidential to the extent possible, but will have to disclose certain information in order to conduct a thorough investigation.

If possible, the investigator should avoid using names of the accused and the complainant. Open-ended questions such as, “Have you seen anyone at work touch other employees in a way that made the employee feel uncomfortable?” is a good way to start.  As the interview proceeds, the investigator may get more specific.

Investigators must assume that everything that is said or written in an investigation will be discoverable.  Maintaining accurate notes is essential.

Investigators must also be aware that certain laws protect employees from over-intrusive investigations. The Employee Polygraph Protection Act – The Federal Employee Polygraph Protection Act (“EPPA”), 29 U.S.C.A. 2001 et seq., The Omnibus Crime Control and Safe Streets Act of 1968, 18 U.S.C. §§ 2510-2520 and the Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq., are just a few examples.

Investigators must also be cognizant of different tort claims that can arise from an improper investigation.  Claims such as defamation, false imprisonment, invasion of privacy or even intentional infliction of emotional distress must be considered.


Investigations typically have 5 phases:

  1. The intake
  2. Creating the investigation pan
  3. Interviews and document review
  4. Evaluating the information
  5. Closing the loop

The intake is usually beginning of any investigation.  It’s where the investigator learns about the complaint or other impetus for the investigation, who the primary participants in the investigation may be, and the scope of the investigation.  It is the foundation of the investigation, and the building blocks for the following stages.

The investigator should then create an investigation plan detailing the likely witnesses to be interviewed and documents to be reviewed. The investigator may have suggestions for interim remedies necessary to preserve the investigation’s integrity or for employee protection.  The investigator must consider who to interview first, where the interviews will take place, and the possible scope of documents to be reviewed.

After an investigation plan is drafted, the investigator will begin interviewing witnesses and reviewing documents. There is no magic formula as to whom should be investigated first and in what order, but most investigators start with the person making the complaint.  The investigator may receive information that reveals other potential witnesses.  Depending on the circumstances, the investigator may want to speak with independent witnesses before interviewing the alleged perpetrator.  In some instances, such as when documents or video evidence reveals the exact nature of the alleged misconduct, additional interviews may be limited. In other circumstances, the number of witnesses may be very high.

After the investigator interviews the witnesses and reviews the relevant documents, the investigator has to evaluate the information.  Investigators should evaluate the credibility of each witness, which may include underlying motivations.  Depending on the scope of the investigation, the investigator may be called asked to render an opinion regarding the conclusions to be drawn from the information obtained. In other circumstances, the investigator presents only the facts and the employer reaches its own conclusions.

Closing the loop is usually the final step an effective investigation.  This is where the investigator, or the employer, reveals the results of the investigation and takes appropriate remedial steps.  The complainant is not necessarily entitled to a full report of each piece of information obtained, but someone should reach out to the complainant and the alleged perpetrator to discuss the end results of the investigation.  This provides finality to investigation process, and enables the parties to determine how to proceed.

Each investigation is unique.  Although there are general underlying principles that apply in most investigations, sometimes an investigation must deviate from the norm.  What is required in any particular instance will be determined by the specific facts and circumstances leading to the investigation.


Original article by Robert E. Nuddleman of Nuddleman Law Firm, P.C.

Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law, but we cannot answer questions about specific situations or provide legal advice. If you desire legal advice, you should contact an attorney.

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The attorneys of Nuddleman Law Firm, P.C. represent employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Pleasanton, Oakland, San Ramon, Hayward, Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.

Hours Worked for Calculating Worker Pay

What are the “Hours Worked” for Purposes of Calculating Employee Pay?

Employers must pay employees for all “hours worked.”  But does an employer have to pay an employee when the employee is not actually rendering services on behalf of the employer?  The answer may surprise you.

Definition of Hours Worked

The Industrial Welfare Commission, the agency charged with promulgating California regulations regarding the terms and conditions of employment, typically define “hours worked” as ” the time during which an employee is subject to the control of an employer, and includes all the time the employee is suffered or permitted to work, whether or not required to do so.”  This includes any time the employee is required to be in a specific location, and any time the employee actually performs work, even if the work is not previously approved.

Wage Order 5 regarding the Public Housekeeping Industry, adds a special definition “in the case of employee required to reside on the employment premises.” For employees required to reside on the premises (such as residential care facilities and apartment managers) “hours worked” is the “time spent carrying out assigned duties.”  This special definition only applies to persons employed in the Public Housekeeping Industry, which includes “any industry, business, or establishment which provides meals, housing, or maintenance services whether operated as a primary business or when incidental to other operations in an establishment not covered by an industry order of the Commission.”

Employees working in the health care industry also have a special definition of “hours worked: “the time during which an employee is suffered or permitted to work for the employer, whether or not required to do so, as interpreted in accordance with the provisions of the Fair Labor Standards Act.”

These differing definitions lead to confusion and potentially costly mistakes.  Employees and employers need to understand which hours are counted as hours worked so that employees can be properly compensated.

Sleep Time

Recent California Supreme court decisions make it clear that, unless the employee is covered by Wage Order 5, employees that are required to remain on the premises are entitled to compensation, even if the employee spends some of that time sleeping.   There are a few exceptions, such as ambulance drivers, but for the most part employers are required to compensate employees for all hours worked.

On-Call Time

Some employers need employees to be available to answer cell phone calls and/or email messages.  Depending on several factors, the time spent waiting for the phone to ring or for the email to come may be compensable or not.  Is the employee “waiting to be engaged?” or “engaged to wait?”  State and federal law define compensable on-call or stand-by time differently.  Although technology has made it easier for employees to work away from the job site, that same technology also creates new liabilities for employers.

Meals and Rest Breaks

All employees are entitled to take regular meal and rest breaks.  Failure to provide required rest breaks to non-exempt employees can carry significant penalties.  Employers are required to maintain accurate records of the hours worked, including meal breaks taken.  Employers that do not maintain accurate records of meal breaks have a difficult time defending meal and rest break violation claims.  Courts and the Labor Commissioner continue to struggle with how much control an employer can exercise over an employee during the required breaks, and how far an employer has to go to ensure the employee is afforded the opportunity take all required breaks.

Despite the media attention given to this topic, many employers still fail to adequately relieve employees, and large and small companies routinely face litigation involving meal and rest break claims.  Employers are much more likely to violate wage and hour laws than anti-discrimination laws, and employees are much more likely to pursue wage claims.

Understanding the employer and employee rights and obligations is the first step in resolving any potential issues.  Robert Nuddleman has advised and litigated unpaid wage claims on behalf of hundreds of clients. Because he represents employees and employers, he understands the motivating factors behind the dispute, and how to avoid issues before they become problems, and how to resolve problems when they occur.

Recent Employment Cases Effecting California Workplaces

The following is a compilation of recent employment cases effective California workplaces.

California and federal courts and administrative decisions alter the landscape and refine the relationship between companies and their employees.  The Nuddleman Law Firm stays abreast of recent developments so we can better serve our clients.

December 2015

Santa Monica College Faculty Association v. Santa Monica Community College District

Labor And Employment/Labor Law/Collective Bargaining Agreements/Education Law

College’s authority to revoke faculty member’s annual reappointment right was governed by terms of collective bargaining agreement

Cruz v. Sun World International, LLC

Labor And Employment/Civil Procedure/Class Actions

Conflicting evidence supported denial of class certification in agricultural workers’ hours and wages suit

Mitchell v. Superior Court (Johnson)

Civil Procedure/Pre-Trial Procedure/Torts/Personal Injury

Interrogatory request for names of witnesses to “incident” did not compel disclosure of witnesses other than percipient witnesses

Caldecott v. Superior Court (Newport-Mesa Unified School District)

Labor And Employment/Hiring/Firing

Petitioner’s possession of documents he was seeking did not render California Public Records Act request moot

Kerkeles v. City of San Jose

Civil Procedure/Civil Rights

Trial court failed to explain drastically reduced fee award

Flowers v. Los Angeles County Metropolitan Transportation Authority

Labor And Employment

Wage order rest-period requirements did not apply to county’s public transit operators

Sturgeon v. County of Los Angeles

Labor And Employment/Wages And Hours

Recent legislation did not vest counties with undue discretion as to compensation of county judges

Holloway v. Quetel

Civil Procedure/Judgments/Landlord/Tenant Law

Trial court failed its duty to provide neutral guidance to pro se plaintiff as to default-judgment requirements

Prue v. Brady Company/San Diego, Inc.

Labor And Employment/Hiring/Firing

Employee alleged adequate factual basis for claim for wrongful termination in violation of public policy

Javorsky v. Western Athletic Clubs, Inc.

Civil Rights

Health club did not unlawfully discriminate on basis of age by providing discounted membership to individuals aged 18 to 29

Rosenfield v. GlobalTranz Enterprises, Inc.

Labor And Employment/Hiring/Firing

Human resources manager’s repeated complaints to employer regarding non-compliance with Fair Labor Standards Act constituted “complaints” for purposes of Act’s anti-retaliation clause

DIRECTV, Inc. v. Imburgia

Civil Procedure/Alternative Dispute Resolution/Arbitration (ADR)

California court of appeal erred in concluding that California law relating to service agreement barring mass arbitration was not preempted by Federal Arbitration Act

Crawford v. JPMorgan Chase Bank, N.A.

Legal Profession/Civil Procedure

Counsel’s contemptuous behavior and threats of violence warranted terminating sanctions

Palacio v. Jan and Gail’s Care Homes, Inc.

Labor And Employment/Wages And Hours

Employee of 24-hour residential care facility may legally be required to work on-duty meal periods

Catalina Island Yacht Club v. Superior Court (Beatty)

Civil Procedure/Discovery

Inadequate privilege log not grounds for compelled disclosure of purportedly privileged communications

November 2015

Richtek USA, Inc. v. uPI Semiconductor Corporation

Civil Procedure/Evidence/Intellectual Property/Trade Secrets

Trial court erred in taking judicial notice of foreign documents to resolve fact issues on demurrer

Sabato v. Brooks

Civil Procedure/Evidence/Jurisdiction And Service Of Process

Party’s failure to comply with procedures for filing motion to quash resulted in waiver of issue of personal jurisdiction

Ramos v. Westlake Services LLC

Consumer Protection/Alternative Dispute Resolution/Arbitration (Adr)/Contracts/Insurance Law/Automotive

Merchant’s omission of arbitration agreement from Spanish-language translation of sales contract rendered that agreement void

Ramirez v. County of San Bernardino

Civil Procedure/Pre-Trial Procedure

Plaintiff could file second amended complaint as matter of course after first amended complaint was filed with opposing party’s consent

Brinkley v. Monterey Financial Services, Inc.

Alternative Dispute Resolution/Contractual Clauses/Arbitration (ADR)

Arbitration clause was substantively unconscionable in requiring award of all fees and costs to prevailing party

California Department of Justice v. Board of Administration of California Public Employees’ Retirement System (Resendez)

Labor And Employment

California Department of Justice had mandatory duty to reinstate peace officer who no longer suffered condition that led to disability retirement

Cooper v. Bettinger

Civil Procedure

Trial court had discretion whether to renew civil harassment restraining order after protected party’s timely application

National Labor Relations Board ex. rel. United Food and Commercial Workers International Union v. Fresh and Easy Neighborhood Market, Inc.

Labor And Employment/Labor Law

Employer suffered no prejudice where union failed to serve copy of subpoena on employer’s counsel in administrative proceeding

Jumaane v. City of Los Angeles

Labor And Employment/Discrimination/Race Discrimination/Civil Procedure/Statute Of Limitations

City had viable statute of limitations defense to firefighter’s continuing-violation race discrimination claims

Roos v. Honeywell International, Inc.

Civil Procedure/Class Actions

Class settlement fee award was appropriate where attorney fee cap resulted in lower award than authorized under lodestar method

Performance Team Freight Systems, Inc. v. Aleman

Labor And Employment/Wages And Hours/Alternative Dispute Resolution/Contractual Clauses

Arbitration agreement signed by truck drivers as independent contractors applied to cover their statutory wage claims

Brown-Hunter v. Colvin

Social Services Law/Social Security Compensation

Administrative law judge erred by failing to identify parts of Social Security claimant’s testimony deemed not credible

October 2015

Batten v. Workers’ Compensation Appeals Board

Labor And Employment/Social Services Law/Workers’ Compensation/Evidence/Admissibility

Privately retained expert’s evaluation of injured employee not admissible as evidence before Workers’ Compensation Appeals Board

Stevens v. Workers’ Compensation Appeals Board

Labor And Employment/Social Services Law/Workers’ Compensation/Constitutional Law

Workers’ compensation independent medical review process comports with state and federal constitutional due process requirements

Nunez v. Pennisi

Civil Procedure/Torts

Party’s knowingly false allegations sufficed to show opposing party’s probability of prevailing in malicious prosecution action

Dhawan v. Biring

Civil Procedure/Judgments

Default judgment void where entered on complaint that failed to specify amount of damages sought

Garrido v. Air Liquide Industrial U.S. LP

Labor And Employment/Alternative Dispute Resolution/Civil Procedure/Class Actions/Wages And Hours/Arbitration (Adr)

Gentry remained valid as to arbitration agreement not governed by FAA

Equal Employment Opportunity Commission v. McLane Company, Inc.

Labor And Employment/Discrimination/Sex Discrimination

EEOC did not overreach in seeking identifying information for employees potentially affected by employer’s alleged sex discrimination

SingerLewak LLP v. Gantman

Alternative Dispute Resolution/Arbitration (Adr)

Alleged error in arbitrator’s resolution of claim not subject to judicial review

In re ChinaCast Education Corporation Securities Litigation

Securities And Federal Corporate Law/Shareholder Derivative Suits/Securities Fraud

Adverse interest exception does not apply to corporate officer acting within actual or apparent authority

Hajro v. United States Citizenship and Immigration Services

Immigration Law

Attorney could potentially establish personal harm suffered as result of agency’s alleged pattern or practice of violating his clients’ FOIA requests

Dorsey v. Superior Court (Crosier)


Statutory cap on attorney fee award in small claims appeal overrode attorney fee provision in parties’ contract

United States v. Eyraud

Criminal Law

Employee convicted of embezzling employer’s funds was properly ordered to pay restitution that included victim’s attorney fee

Sheridan v. Touchstone Television Productions, LLC

Labor And Employment/Hiring/Firing

Plaintiff not required to exhaust administrative remedies prior to suing employer for retaliation

Alberts v. Aurora Behavioral Health Care

Civil Procedure/Class Actions/Labor And Employment/Wages And Hours

Class certification did not require plaintiffs to demonstrate universal policy of denying meal and rest breaks

CVS Pharmacy, Inc. v. Superior Court (Deluca)

Civil Procedure/Class Actions/Labor And Employment/Hiring/Firing

Non-class-member plaintiff not eligible to seek precertification discovery in headless class action absent any evidence she had a good-faith belief she had standing

Valencia v. SCIS Air Security Corporation

Labor And Employment/Wages And Hours

Airline Deregulation Act did not preempt airline security company worker’s wages and hours claims

Miranda v. Anderson Enterprises, Inc.

Civil Procedure/Class Actions/Labor And Employment/Wages And Hours/Labor Law/Alternative Dispute Resolution/Arbitration (Adr)

Order dismissing Private Attorneys General Act claim and compelling arbitration of individual claims was immediately appealable under “death knell” doctrine

Sharif v. Mehusa, Inc.

Labor And Employment

Single action involving multiple claims governed by different fee shifting provisions can result in fee awards to both parties as prevailing parties

Mobile Medical Services for Physicians and Advanced Practice Nurses, Inc. v. Rajaram

Torts/Intentional Torts/Defamation/Civil Procedure

SLAPP plaintiff not entitled to leave to redraft complaint to avoid reference to protected conduct

Behm v. Clear View Technologies

Civil Procedure/Judgments

Notice of punitive damages filed after trial court ruling granting default was untimely

Cardenas v. M. Fanaian, D.D.S., Inc.

Labor And Employment/Hiring/Firing

Claim of retaliation in violation of Labor Code need not be premised on report of employer’s unlawful business activity

New York Knickerbockers v. Workers’ Compensation Appeals Board

Labor And Employment/Social Services Law/Workers’ Compensation

Basketball player’s cumulative injury brought New York team within jurisdiction of California workers’ compensation law

Tellez v. Rich Voss Trucking, Inc.

Appellate Law – Civil/Labor And Employment/Wages And Hours/Civil Procedure/Class Actions

Order denying class certification subject to mandatory reversal in absence of any explanation for trial court’s ruling

Danser v. California Public Employees Retirement System

Labor And Employment/Employee Benefits/Pensions And Other Retirement Benefits

Reduction of former superior court judge’s felony conviction to misdemeanor did not entitle him to reinstatement of retirement benefits

September 2015

Conservatorship of Moore

Trusts And Estates

Retained counsel for elderly person with dementia charged client unreasonable fees and costs that did not benefit client

Negron v. Los Angeles County Civil Service Commission (County of Los Angeles)

Labor And Employment/Hiring/Firing

Sheriff’s department had authority to discharge deputy for misconduct while on unpaid relieved-of-duty status

O’Bannon v. National Collegiate Athletic Association

Antitrust/Antitrust And Intellectual Property/Education Law/Labor And Employment

NCAA’s amateurism rules are subject to antitrust review under Rule of Reason

Vita Planning and Landscape Architecture, Inc. v. HKS Architects, Inc.

Civil Procedure/Choice Of Law/Contracts

Public policy barred enforcement of forum-selection clause requiring California subcontractor to litigate dispute in Texas

Sakkab v. Luxottica Retail North America, Inc.

Labor And Employment/Labor Law/Alternative Dispute Resolution/Arbitration (Adr)

Federal Arbitration Act does not preempt California’s judicial bar against waiver of Private Attorneys General Act representative claims

Contra Costa County v. Workers Compensation Appeals Board and Doreen DAHL

Labor And Employment/Social Services Law/Workers’ Compensation

Diminished future earning capacity no basis to deviate from prescribed workers’ compensation permanent disability rating

International Franchise Association, Inc. v. City of Seattle

Civil Procedure/Provisional Remedies/Labor And Employment/Wages And Hours/Constitutional Law

International Franchise Association not entitled to preliminary injunction against enforcement of Seattle minimum wage ordinance

San Diegans for Open Government v. Har Construction, Inc.

Civil Procedure/Statute Of Limitations

Anti-SLAPP motion untimely and also barred by public interest exemption to SLAPP statute

Melendrez v. Ameron International Corporation

Torts/Toxic Torts/Social Services Law/Workers’ Compensation

Worker’s alleged exposure to asbestos in employer’s products outside workplace did not render workers’ compensation exclusivity rule inapplicable

Sierra Managed Asset Plan, LLC. v. Hale


Company employee’s testimony regarding documents created by company’s predecessor-in-interest insufficient to lay foundation needed for business records exception to hearsay rule

Jeff Tracy, Inc. v. City of Pico Rivera

Civil Procedure/Trial

Contractor entitled to jury trial on issue of whether it held valid contractor’s license during performance of public works project

Idaho Building and Construction Trades Council, AFL-CIO v. Inland Pacific Chapter of Associated Builders and Contractors, Inc.

Labor And Employment/Labor Law

National Labor Relations Act preempted Idaho’s statutory ban on construction unions’ “job targeting” programs

Simonelli v. City of Carmel-By-The-Sea

Civil Procedure/Statute Of Limitations

Trial court applied wrong limitations period when it denied leave to amend for failure to join indispensable party

AP-Colton LLC v. Ohaeri

Landlord/Tenant Law

Party was judicially estopped from challenging reclassification of case as unlimited civil action

Wabakken v. California Department of Corrections and Rehabilitation

Labor And Employment

State personnel decision did not collaterally estop employee from maintaining judicial action

Lenz v. Universal Music Corp.

Intellectual Property/Copyrights/Infringement (Copyright)

Digital Millennium Copyright Act requires copyright holder to consider fair use before sending takedown notification

21st Century Insurance Company v. Superior Court (Tapia)

Insurance Law/Civil Procedure/Judgments

Insurer was not bound by stipulated judgment agreed to by insured without consent of insurer

Warren v. Warren

Civil Procedure/Judgments

Defendant in accounting action was entitled to notice of potential liability prior to entry of default

Pasadena Police Officers Association v. Superior Court (City of Pasadena)

Labor And Employment

Records pertaining to criminal investigation of police officers’ fatal shooting of civilian were not exempt from disclosure under Public Records Act

Barker v. Fox and Associates

Torts/Intentional Torts/Defamation

Defamation claim defective for failure to provide details of alleged defamatory statements

Resilient Floor Covering Pension Trust Fund Board of Trustees v. Michaels Floor Covering, Inc.

Labor And Employment/Employee Benefits

Construction industry successor employer may bear Multiemployer Pension Plan Amendments Act withdrawal liability

Kahn v. Dewey Group

Civil Procedure/Settlement/Evidence/Expert Witnesses/Torts/Toxic Torts

After multiple defendants jointly made Section 998 offer, whether offer exceeded judgment could not be determined by comparing it to judgments entered against some but not all offering defendants

Oregon Teamster Employers Trust v. Hillsboro Garbage Disposal, Inc.

Labor And Employment/Employee Benefits

Employer health and benefit plan’s breach of contract claims against subscribing employer were preempted by ERISA

Watson v. City of San Jose

Civil Rights/Constitutional Law

Retrial in Section 1983 civil rights case was justified by first jury’s flawed compensatory damages award

IATSE Local 720 v. InSync Show Productions, Inc.

Appellate Law – Civil/Labor And Employment/Labor Law/Alternative Dispute Resolution/Arbitration (Adr)

Order granting arbitration terminated litigation for purposes of appellate jurisdiction

Balestrieri v. Menlo Park Fire Protection District

Labor And Employment/Wages And Hours

Firefighters not entitled to overtime pay for taking gear to temporary duty stations

Alcantar v. Hobart Service

Civil Procedure/Class Actions/Labor And Employment/Wages And Hours

Ambiguity in employer’s policies regarding company vehicles barred grant of summary judgment on employees’ claim of entitlement to compensation for having to commute using company vehicles

In re Acknowledgment Cases

Labor And Employment/Employment Contracts

City could not require police officers to reimburse department-mandated training costs upon leaving to work elsewhere

August 2015

Hewlett-Packard Company v. Oracle Corporation

Civil Procedure/Trial

Anti-SLAPP motion filed 632 days after complaint and on eve of second phase of trial was properly dismissed as untimely.

Royal Pacific Funding Corporation v. Arneson

Appellate Law – Civil/Labor And Employment

Employee was entitled to legal fees incurred in defending against employer’s aborted appeal of Labor Commission award.

James L. Harris Painting and Decorating, Inc. v. West Bay Builders, Inc.

Civil Procedure/Judgments

No error in trial court’s determination that no party prevailed at trial for purposes of attorney fee award.

Poole v. Orange County Fire Authority

Labor And Employment

Supervisor’s log of firefighter’s daily activities was not part of firefighter’s personnel file for purposes of Firefighters Procedural Bill of Rights Act.

Diamond v. Reshko

Civil Procedure/Settlement/Evidence/Torts/Motor Vehicles

Pretrial settlement with testifying party defendant should have been disclosed to jury

Universal Protection Service, LP v. Superior Court (Parnow)

Alternative Dispute Resolution/Arbitration (ADR)/Labor And Employment/Labor Law

Arbitration agreement’s reference to American Arbitration Association’s National Rules bound parties to those rules.

Carlson v. Home Team Pest Defense, Inc.

Labor And Employment/Labor Law/Alternative Dispute Resolution/Arbitration (ADR)/Employment Contracts

Employer’s contractual arbitration agreement was unenforceable as procedurally and substantively unconscionable.

Connor v. First Student, Inc.

Labor And Employment/Constitutional Law

Investigative Consumer Reporting Agencies Act not unconstitutionally vague as applied to background checks relating to both character and creditworthiness

Brennan v. Opus Bank

Alternative Dispute Resolution/Arbitration (Adr)/Labor And Employment/Labor Law

Corporate officer’s wrongful-termination claim was arbitrable where parties’ agreement incorporated AAA rules.

Sanchez v. Valencia Holding Company, LLC

Consumer Protection/Civil Procedure/Class Actions/Alternative Dispute Resolution

Arbitration provisions in car purchase agreement did not render it unconscionable.

France v. Johnson

Labor And Employment/Discrimination/Age Discrimination

Employee’s showing that supervisor considered age pertinent to promotion decision raised triable issue of fact under Age Discrimination in Employment Act.

July 2015

Garcia v. Seacon Logix


Truck drivers entitled to reimbursement under Labor Code section 2802 for paycheck deductions, when misclassified as independent contractors instead of employees.

Yocupicio v. PAE Group, LLC

Civil Procedure/Class Actions/Jurisdiction And Service Of Process/Labor And Employment/Wages And Hours

Representative claim filed under California Labor Code Private Attorney General Act could not be deemed class claim for purposes of federal jurisdiction under Class Action Fairness Act of 2005

Bos v. Board of Trustees

Bankruptcy/Creditors’ And Debtors’ Rights/Labor And Employment/Employee Benefits/Pensions And Other Retirement Benefits

Employer’s contractual obligation to contribute to employee-benefit trust funds did not make employer fiduciary of unpaid contributions

Mayo v. PCC Structurals, Inc.

Labor And Employment/Discrimination/Disability Discrimination/Civil Rights

Employee who threatened to kill specific co-workers was not “qualified individual” under Oregon disability law

Safeway, Inc. v. Superior Court (Esparza)

Civil Procedure/Class Actions/Labor And Employment/Wages And Hours

Evidence supported class certification of claim that employers violated unfair competition law by never paying premium wages for missed meal breaks

Ranza v. Nike

Dismissal of claims under the doctrine of forum non conveniens because the Netherlands provided a more convenient forum than Oregon, and the Dutch Equal Treatment Commission was an adequate alternative forum.

Williams v. National Union Fire Insurance Company of Pittsburgh, P.A.

Insurance Law/Labor And Employment/Employee Benefits

Employee’s death from deep vein thrombosis following several air flights did not result from “accident” for purposes of accidental death policy

Arce v. Douglas

Education Law/Civil Rights/Constitutional Law

Arizona infringed students’ First Amendment rights by barring courses designed primarily for pupils of particular ethnic group

Pinela v. Neiman Marcus Group, Inc.

Labor And Employment/Employment Contracts/Alternative Dispute Resolution/Arbitration

Arbitration agreement’s choice of law provision rendered delegation of issue of enforceability to arbitrator unconscionable and unenforceable

Munoz v. Chipotle Mexican Grill, Inc.

Civil Procedure/Class Actions/Appellate Law – Civil/Labor And Employment/Wages And Hours

Trial court order denying plaintiffs’ class certification motion and granting employer’s motion to deny class certification was not appealable

June 2015

Benko v. Quality Loan Service Corporation

Civil Procedure/Class Actions

District court lacked jurisdiction where Class Action Fairness Act’s “local controversy exception” required remand to state court.

Marsh v. Colvin

Social Services Law

Administrative law judge erred in denying application for disability benefits with no mention of doctor’s report concluding that applicant was disabled.

Universal Protection Service v. Super. Ct.

Class/Representative Arbitration

The petition for review is granted. Further action in this matter is deferred pending consideration and disposition of a related issue in Sandquist v. Lebo Automotive, S220812 (see Cal. Rules of Court, rule 8.512(d)(2)) [Does the trial court or the arbitrator decide whether an arbitration agreement provides for class arbitration if the agreement itself is silent on the issue?], or pending further order of the court. Submission of additional briefing, pursuant to California Rules of Court, rule 8.520, is deferred pending further order of the court.  Review granted/briefing deferred.

Khalatian v. Prime Time Shuttle

Misclassification/FAA Arbitration Applies

Defendants Prime Time Shuttle, Inc. (Prime Time), Rideshare Airport Management, LLC, formerly known as Rideshare Port Management, LLC, and Rattan Joea appeal a trial court order denying their motion to compel arbitration of claims based on the alleged misclassification of plaintiff Valo Khalatian as an independent contractor rather than an employee.  We find the Federal Arbitration Act (FAA; 9 U.S.C. § 1 et seq.) applies to the parties’ arbitration agreement, and all of plaintiff’s claims are arbitrable.  We also conclude defendants did not waive their right to arbitration even though they waited 14 months after the complaint was filed to move to compel arbitration.  Plaintiff cannot demonstrate prejudice from the delay, which is determinative.  (Saint Agnes Medical Center v. PacifiCare of California (2003) 31 Cal.4th 1187, 1203.)  We reverse the trial court’s order denying the petition to compel arbitration and remand the case to the trial court with instructions to enter an order compelling arbitration of all of plaintiff’s claims.

Williams v. Super. Ct.

Single Cause of Action under PAGA Claim Cannot be Split into Arbitrable Individual and Non-arbitrable Representative Claims

Petitioner Andre Williams filed a single-count representative action pursuant to the Private Attorney General Act, Labor Code section 2699 et seq. (PAGA), alleging that real party in interest Pinkerton Governmental Services, Inc. (Pinkerton) violated various provisions of the Labor Code.  In response, Pinkerton moved to enforce petitioner’s waiver of his right to assert a representative PAGA claim, or alternatively, for an order staying the PAGA claim, but sending the “individual claim” that petitioner had been subjected to Labor Code violations to arbitration pursuant to a written agreement.  The trial court denied the motion to enforce the waiver, but granted the alternative relief.  Williams petitioned this court for a writ reversing the trial court’s order, arguing that it violated Iskanian v. CLS Transportation Los Angeles, LLC (2014) 59 Cal.4th 348, 384 (Iskanian).  We agree with the trial court that under Iskanian, the waiver of a right to assert a representative PAGA claim in any forum is unenforceable.  However, we conclude that petitioner’s single cause of action under PAGA cannot be split into an arbitrable “individual claim” and a nonarbitrable representative claim.  Accordingly, we grant the petition.

International Brotherhood of Teamsters, Airlines Division v. Allegiant Air, LLC

Labor And Employment/Labor Law/Union Representation

Federal courts have jurisdiction to determine whether entity that previously negotiated on behalf of employees qualified as employees’ Railway Labor Act representative.

Noe v. Super. Ct.

Joint Employers and Misclassification

Anschutz Entertainment Group (AEG) contracted with Levy Premium Foods to manage the food and beverage services at several entertainment venues located in southern California.  Levy contracted with Canvas Corporation to provide laborers who sold food and beverages at AEG venues.  In 2013, several vendors filed a wage and hour class action against AEG, Levy and Canvas for failure to pay minimum wage and willfully misclassifying them as independent contractors in violation of Labor Code section 226.8.

AEG and Levy filed motions for summary judgment arguing in part that they were entitled to summary adjudication of plaintiffs’ section 226.8 claim because the undisputed evidence showed Canvas was the entity that had classified the vendors as independent contractors.  Although the trial court denied the motions for summary judgment, it agreed that plaintiffs could not pursue a section 226.8 claim against AEG or Levy because neither entity had made the alleged misclassification decision.

Plaintiffs filed a petition for writ of mandate and we issued an order to show cause.  In their return to the writ, AEG and Levy argued for the first time that even if the trial court erred in interpreting section 226.8, we should deny the writ because the statute does not provide a private right of action.  We now deny plaintiffs’ petition.  We conclude that, contrary to the trial court’s interpretation, section 226.8 is not limited to employers who make the misclassification decision, but also extends to any employer who is aware that a co-employer has willfully misclassified their joint employees and fails to remedy the misclassification.  However, we further conclude that section 226.8 cannot be enforced through a direct private action and deny the plaintiffs’ writ on that basis.

Oregel v. PacPizza


Seventeen months and more than 1,300 attorney hours after plaintiff Julio Oregel (Oregel) filed a class action against his former employer, defendant PacPizza, LLC (PacPizza), PacPizza petitioned to compel arbitration of Oregel’s claims.  The trial court denied the petition, finding PacPizza waived its right to enforce a purported arbitration agreement between the two parties.  PacPizza appeals, primarily contending the court erred in denying the petition, and also asserting two other claimed errors.  We conclude the petition was properly denied, a conclusion that moots PacPizza’s remaining arguments.  We thus affirm.

Gerard v. Orange Coast Memorial Medical Center

Partial Invalidity of Wage Order/Second Meal Break Waiver

Petition for review after the Court of Appeal reversed the judgment in a civil action. This case presents the following issues: (1) Is the health care industry meal period waiver provision in section 11(D) of Industrial Wage Commission Order No. 5-2001 invalid under Labor Code section 512, subdivision (a)? (2) Should the decision of the Court of Appeal partially invalidating the Wage Order be applied retroactively?

Equal Employment Opportunity Commission v. Abercrombie and Fitch Stores, Inc.

Constitutional Law/Labor And Employment/Hiring/Firing

U.S. Supreme Court: Disparate-treatment claimant need show only that his or her need for accommodation was motivating factor in employer’s decision, not that employer had knowledge of that need.

May 2015

Verdugo v. Alliantgroup, L.P.

Labor And Employment/Employment Contracts/Civil Procedure/Choice Of Law

Forum selection clause in employment agreement not enforceable absent showing that enforcement would not impair employee’s statutory rights under Labor Code.

LeGras v. AETNA Life Insurance Company

Labor And Employment/Employee Benefits/Pensions And Other Retirement Benefits

9th Circuit: Employee’s internal appeal of ERISA claim mailed on Monday following Saturday on which appeal period expired was timely.

Higgins-Williams v. Sutter Medical Foundation (CA3 C073677 5/26/15)

Inability to Work under Particular Supervisor not FEHA Disability Claim

In this action for disability discrimination and wrongful termination, we affirm a summary judgment in favor of the defendant employer.  We do so largely because the plaintiff employee’s alleged disability—an inability to work under a particular supervisor because of anxiety and stress related to the supervisor’s standard oversight of job performance—is not a disability recognized in California’s Fair Employment and Housing Act (FEHA; Gov. Code, § 12900 et seq.).

Vector Resources, Inc. v. Baker

DIR Prevailing Wage Notice & Stamp Not Underground Regulations

This action arises out of a determination by the Department of Industrial Relations (the Department) that plaintiff Vector Resources, Inc. (Vector) failed to pay the appropriate prevailing wages to its workers on a public works project for the San Diego Unified School District.  Specifically, the Director of Industrial Relations (the Director) issued a decision in which she found that Vector underpaid its employees by failing to pay a higher “shift differential” rate for work performed during shifts commencing after 12:00 noon.  The director’s decision was based on regulatory language in a document entitled “Important Notice To Awarding Bodies And Other Interested Parties Regarding Shift Differential Pay In The Director’s General Prevailing Wage Determinations” (the Important Notice), which was posted on the Department’s Web site.  The Important Notice addresses shift differential pay for various crafts used on public works projects, and is augmented by additional regulatory language in a “Note” that the Department places on the cover page of prevailing wage shift provisions.  The parties refer to this Note as “the Stamp.”

Vector filed a declaratory relief action against the Department, seeking a declaration that the Important Notice and Stamp are invalid and unenforceable as “underground regulations” because they were not promulgated in compliance with the notice and hearing requirements of the Administrative Procedure Act (APA).  (Gov. Code, § 11340 et seq.)  Vector and the Department filed cross-motions for summary judgment, based largely on stipulated facts.  The court granted the Department’s motion on the ground that under Government Code section 11340.9, subdivision (g), the Important Notice and the Stamp are exempt from the notice and hearing requirements of the APA because they are part of an overall prevailing wage determination process that constitutes “rate setting.”

Harris v. Amgen, Inc. (9th Cir. 10-56014 ord. & amend. opn. 5/26/15)

ERISA Class Action 

The panel filed (1) an order amending and replacing its prior opinion and denying, on behalf of the court, a petition for rehearing en banc, and (2) an amended opinion.

In the amended opinion, on remand from the United States Supreme Court for reconsideration in light of Fifth Third Bancorp v. Dudenhoeffer, 134 S. Ct. 2459 (2014), the panel reversed the district court’s dismissal of a class action brought by current and former employees of Amgen, Inc., and an Amgen subsidiary under the Employee Retirement Income Security Act, alleging breach of fiduciary duties regarding two employer-sponsored pension plans.

The plans were employee stock ownership plans that qualified as “eligible individual account plans,” or “EIAPs.” All of the plaintiffs’ EIAPs including holdings in the Amgen Common Stock Fund, which held only Amgen common stock.

The Supreme Court held in Fifth Third that there is no presumption of prudence for employee stock ownership plan fiduciaries beyond the statutory exemption from the otherwise applicable duty to diversify. The panel held, therefore, that the plaintiffs were not required to satisfy the criteria of Quan v. Computer Sci. Corp., 623 F.3d 870 (9th Cir. 2010), in order to show that no presumption of prudence applied.

The panel held that the plaintiffs stated a claim that the defendants acted imprudently, and thereby violated their duty of care, by continuing to provide Amgen common stock as an investment alternative when they knew or should have known that the stock was being sold at an artificially inflated price. The panel concluded that there was no contradiction between defendants’ duty under the federal securities laws and ERISA.

The panel held that the plaintiffs sufficiently alleged that the defendants violated their duty of loyalty and care by failing to provide material information to plan participants about investment in the Amgen Common Stock Fund. Agreeing with the Sixth Circuit, the panel held that the defendants’ preparation and distribution of summary plan descriptions, including their incorporation of Amgen’s SEC filings by reference, were acts performed in their fiduciary duty.

The panel also reversed the dismissal of derivative claims, as well as a claim that the defendants caused the plans directly or indirectly to sell or exchange property with a party-in interest. Because the Amgen Plan contained no clear delegation of executive authority, the panel reversed the district court’s dismissal of Amgen from the case as a nonfiduciary. The panel remanded the case for further proceedings consistent with its opinion.

Concurring in the denial of rehearing en banc, Judge W. Fletcher wrote that, contrary to the dissent from the denial of rehearing en banc, the panel’s opinion did not hold that as a general matter, when previously concealed material information about a company is eventually revealed, the stock price will inevitably decline by more than the amount it would have declined as a result of merely withdrawing the fund as an investment option. The opinion also did not impose on fiduciaries an obligation to act when they only suspect that there has been a violation of the federal securities laws. Finally, the opinion did not impose on ERISA fiduciaries greater disclosure obligations than those imposed under the federal securities laws.

Dissenting from the denial of rehearing en banc, Judge Kozinski, joined by Judges O’Scannlain, Callahan, and Bea, wrote that the opinion failed to give effect to the creation in Fifth Third of stringent new requirements for plaintiffs who sue fiduciaries under ERISA for imprudent investment in an employer’s stock. Judge Kozinski wrote that the opinion created almost unbounded liability for ERISA fiduciaries and subjected corporations to novel, judicially-fashioned disclosure requirements that conflict with those of the securities laws.

Kellogg Brown and Root Services, Inc. v. United States ex rel. Carter

Civil Procedure/Statute Of Limitations

U.S. Supreme Court: Statute permitting extension of time to file qui tam actions against government contractor during time of war applies only to criminal charges, not to civil claims.

Tibble v. Edison International

Labor And Employment/Employee Benefits/Pensions And Other Retirement Benefits/Civil Procedure/Statute Of Limitations

U.S. Supreme Court: Time limits on breach of fiduciary claim against 401(k) plan administrators not violated so long as claim alleging continuing breach of prudence occurs within six years of suit.

Garcia v. Google, Inc.

Intellectual Property/Copyrights/Infringement (Copyright)/Civil Procedure/Provisional Remedies

9th Circuit: Video actress not entitled to mandatory preliminary takedown injunction absent protectable copyright interest in brief film performance.

Garcia v. Super. Ct.

Wage & Hour Arbitration and Preemption

Petitioners Eduardo Garcia, Garcia Transportation GP, and Luis Torres-Garzon seek relief from the April 25, 2014 order of respondent court (Michael P. Vicencia, Judge) granting the motion of real party in interest Southern Counties Express, Inc. to compel arbitration of Petitioners’ wage and hour complaints to the Labor Commissioner.  We grant the requested relief in part and remand to the trial court with directions.

Williams V. Super. Ct.

PAGA/Employees’ Privacy Interest Trumps Discovery Need

Beginning in January 2012, plaintiff Michael Williams was an employee at a retail store operated by Marshalls of CA (Marshalls) in Costa Mesa, California.  On March 22, 2013, after a little more than one year of employment, he brought a representative action against Marshalls under the Labor Code Private Attorneys General Act of 2004 (PAGA) (Lab. Code, §§ 2698-2699.5), alleging Marshalls failed to provide its employees with meal and rest breaks or premium pay in lieu thereof (Lab. Code, §§ 226.7 & 512),[1] to provide accurate wage statements (§ 226, subd. (a)), to reimburse employees for necessary business-related expenses (§§ 2800 & 2802), and to pay all earned wages during employment (§ 204).

Plaintiff served special interrogatories seeking production of the names and contact information of all nonexempt Marshalls employees in California who had worked for the company beginning on March 22, 2012.  Marshalls objected to the discovery on the ground it was irrelevant, overbroad, unduly burdensome, and implicated the privacy rights of its employees.  Plaintiff met and conferred with Marshalls, offering to address its privacy concerns with a “Belaire-West notice,”[2] but Marshalls rejected the offer.

Plaintiff moved to compel the discovery, arguing the contact information was routinely discoverable in representative employee actions and vital to the prosecution of his PAGA claims.  The trial court granted plaintiff’s motion in part, compelling Marshalls to produce contact information for the employees only at its Costa Mesa store and denying production of the contact information of employees at Marshalls other 128 stores statewide.  The court ordered that plaintiff could renew his motion to compel the remaining information after he had been deposed “for at least six productive hours.”  The court also ruled that in opposition to any such motion, Marshalls could attempt to show plaintiff’s substantive claims had no factual merit.

In these writ proceedings, plaintiff seeks a writ of mandate compelling the superior court to vacate its discovery order and enter a new order granting plaintiff’s motion to compel production a list of all nonexempt employees who worked for Marshalls beginning on March 22, 2012.

Gerawan Farming, Inc. v. Agricultural Labor Relations Board (United Farm Workers of America)

Labor And Employment/Labor Law/Union Representation

Employer may raise union ‘ s abandonment of employees as defense to union ‘ s request for mandatory mediation and conciliation.

Tri-Fanucchi Farms v. Agricultural Labor Relations Board (United Farm Workers of America)

Labor And Employment/Labor Law/Union Representation

Employer may not assert union’s abandonment as defense to bargaining request.

Lozano v. Workers Compensation Appeals Board and State Compensation Insurance Fund

Social Services Law/Workers Compensation

Procedural amendment to Labor Code extended cancer presumption to firefighter who died before law took effect.

Ashbey v. Archstone Prop. Mgmt. (9th Cir. 12-55912 5/12/15)


The panel held that employee Michael Ashbey knowingly waived his right to a judicial forum for his Title VII claim and equivalent state-law claims, reversed the district court’s order denying Archstone Property Management, Inc.’s motion to compel arbitration, and remanded for entry of an order granting Archstone’s motion.

The scope of the Federal Arbitration Act is narrowed by federal statutes, such as Title VII of the Civil Rights Act of 1964, which limits “the enforcement of arbitration agreements with regard to claims arising under” the statute. Kummetz v. Tech Mold, Inc., 152 F.3d 1153, 1155 (9th Cir. 1998).

The panel held that the case was distinguishable from Kummetz and Nelson v. Cyprus Bagdad Copper Corp., 119 F.3d 756 (9th Cir. 1997), because Archstone presented its employee the “express” choice lacking in Kummetz and Nelson where the employee signed an acknowledgment that explicitly notified him that Archstone’s Company Policy Manual contained a Dispute Resolution Policy section explaining Archstone’s arbitration policy, and the employee expressly agreed to adhere to the policy. The panel

concluded that the arbitration provision was enforceable.

Diaz v. Kubler Corporation

Consumer Protection/Torts/Damages

9th Circuit: Neither Fair Debt Collection Practices Act nor California ‘ s Rosenthal Act precluded debt collector ‘ s letter seeking ten percent interest on debt.

Kimco Staffing Services, Inc. v. State of California

Constitutional Law/Labor And Employment/Discrimination

Decision to exclude temporary staffing agencies from workers ‘ compensation self-insurance program had rational basis.

Marzec v. California Public Employees Retirement System

Labor And Employment/Employee Benefits/Pensions And Other Retirement Benefits

Purchase of additional service credits did not entitle police officers or firefighters to supplemental benefits after they took disability retirement.

Hirst v. City of Oceanside (CA4/1 D064549 5/8/15)

FEHA/Contractor Recovery

Kimberli Hirst, an employee of American Forensic Nurses, Inc. (AFN), brought a Fair Employment and Housing Act (FEHA) claim against the City of Oceanside (City), alleging she was sexually harassed by an Oceanside police officer, Gilbert Garcia, while she was providing phlebotomist services on behalf of the Oceanside Police Department.  The jury found Hirst proved her claim and awarded her $1.5 million in damages against the City.  After reducing the amount for which Garcia was found responsible, the court entered judgment in Hirst’s favor for $1.125 million.

The City moved for a new trial and for a judgment notwithstanding the verdict (JNOV).  In the new trial motion, the City contended the damages award was unsupported by the evidence.  In the JNOV motion, the City argued Hirst was not entitled to recover under the FEHA because she was not a City employee, special employee, or a “person providing services pursuant to a contract” under Government Code section 12940, subdivision (j)(1).

The court denied the JNOV motion, but granted the new trial motion finding the damage award was excessive.  The court ordered a new trial on both liability and damages because “the issues are so interrelated that damages cannot be separated from the facts underlying liability.”

Hirst did not appeal from the new trial order, but the City appealed from the denial of its JNOV motion, contending Hirst had no standing to recover damages on her FEHA claim against the City.  We determine the evidence supports that Hirst was a “person providing services pursuant to a contract” and therefore she was entitled to recover against the City for its employee’s sexual harassment.  (§ 12940, subd. (j)(1).)  Based on this conclusion, we do not reach the additional asserted ground for standing (whether Hirst was a “special employee” of the City).  We affirm the court order denying the JNOV motion and remand for further proceedings under the court’s new trial order.

Baez v. California Public Employees Retirement System

Civil Rights/Constitutional Law

Plaintiff who alleged disparate treatment as Latino failed to state claim under California Constitution ‘ s anti-affirmative action provision.

Rodriguez v. Cho

Default Judgment Exceeding Pled Damages is Void 

Nam Min Cho appeals from an order denying his motion to set aside the default judgment in this [wage and hour, PAGA, wrongful termination, and retaliation] action.  Cho raises two main contentions, one relating to purportedly improper or fraudulent service of the summons and complaint, and the second relating to the amount of damages awarded in the default judgment.  We find the first contention lacks merit but the second does not.  We hold the default judgment is void because it exceeded the amount of damages stated in the complaint.  Accordingly, we reverse and remand with directions.

DOL in the News

This month the United States Department of Labor reported that from 2011 to 2014 it recovered more than $6.8 million in overtime and unpaid minimum wages for more than 1300 employees in Bay Area nursing homes and residential care facilities.

Robles v. Employment Development Dept. (CA1/4  A139774 5/4/15)

Unemployment Compensation Benefits

This controversy—which involves the wrongful denial of unemployment compensation benefits—began in January 2010 because of a pair of shoes.  More than five years later, appellant Employment Development Department (EDD or the Department) continues to refuse to award Jose Robles (Robles) the benefits to which he would have been entitled absent the Department’s error, this despite being ordered to do so twice by the trial court and once by this court.  (See Robles v. Employment Development Dept. (2012) 207 Cal.App.4th 1029 (Robles I).)  Most recently, in response to Robles’s motion to enforce writ of administrative mandate, the trial court in August 2013 ordered EDD “to pay withheld federal extension benefits, costs and interest in the amount of $45,560.39, within 30 days.”  Instead, the Department appeals, arguing that Robles is not entitled to benefits for weeks in which he did not certify that he was able, available, and actively looking for work in accordance with EDD’s current regulatory scheme.  Thus, EDD asserts, the trial court’s order is at odds with both federal and state law.  The Department, unfortunately, has shown itself repeatedly unable to see the forest in this matter, instead focusing doggedly on the bureaucratic trees.  Having reviewed in some detail EDD’s response to the directives of both courts involved in this matter, we see no error in the trial court’s order and therefore affirm.

Williams v. Chino Valley Independent Fire Dist. (SC S213100 en banc 5/4/15)

FEHA Governs Costs for Prevailing Party/Discretionary under Christiansburg 

Plaintiff Loring Winn Williams sued defendant Chino Valley Independent Fire District (the District) for employment discrimination in violation of the California Fair Employment and Housing Act.  (FEHA; Gov. Code, § 12900 et seq.)  The trial court granted summary judgment for the District and, in a separate order, awarded the District its court costs.  Williams appealed from the latter order, contending that in the absence of a finding his action was frivolous, unreasonable or groundless, defendant should not have been awarded its costs.

The issues presented are these:  Is a defendant prevailing in a FEHA action entitled to its ordinary court costs as a matter of right pursuant to Code of Civil Procedure section 1032, or only in the discretion of the trial court pursuant to Government Code section 12965, a provision of FEHA itself?  And, if the trial court does have discretion, must that discretion be exercised according to the rule applicable to attorney fee awards in certain federal civil rights actions under Christiansburg Garment Co. v. EEOC (1978) 434 U.S. 412 (Christiansburg), according to which a prevailing defendant receives its attorney fees only if the plaintiff’s action was objectively groundless?

We conclude Government Code section 12965, subdivision (b), governs cost awards in FEHA actions, allowing trial courts discretion in awards of both attorney fees and costs to prevailing FEHA parties.  We further conclude that in awarding attorney fees and costs, the trial court’s discretion is bounded by the rule of Christiansburg; an unsuccessful FEHA plaintiff should not be ordered to pay the defendant’s fees or costs unless the plaintiff brought or continued litigating the action without an objective basis for believing it had potential merit.

Augustus v. ABM Security Services, Inc. (2014) 233 Cal.App.4th 1065

Duty During Rest Breaks

Petition for review after the Court of Appeal reversed the judgment in a civil action. This case presents the following issues: (1) Do Labor Code, § 226.7, and Industrial Welfare Commission wage order No. 4-2001 require that employees be relieved of all duties during rest breaks? (2) Are security guards who remain on call during rest breaks performing work during that time under the analysis of Mendiola v. CPS Security Solutions, Inc. (2015) 60 Cal.4th 833? Review granted/brief due.

April 2015

Mach Mining, LLC v. EEOC

EEOC’s Conciliation Efforts Reviewable

Courts have authority to review whether the EEOC has fulfilled its Title VII duty to attempt conciliation. This Court has recognized a “strong presumption” that Congress means to allow judicial review of administrative action. Bowen v. Michigan Academy of Family Physicians, 476 U. S. 667, 670. That presumption is rebuttable when a statute’s language or structure demonstrates that Congress intended an agency to police itself. Block v. Community Nutrition Institute, 467 U. S. 340, 349, 351. But nothing rebuts that presumption here.

In order to comply with that provision, the EEOC must inform the employer about the specific discrimination allegation. Such notice must describe what the employer has done and which employees (or class of employees) have suffered. And the EEOC must try to engage the employer in a discussion in order to give the employer a chance to remedy the allegedly discriminatory practice. A sworn affidavit from the EEOC stating that it has performed these obligations should suffice to show that it has met the conciliation requirement. Should the employer present concrete evidence that the EEOC did not provide the requisite information about the charge or attempt to engage in a discussion about conciliating the claim, a court must conduct the fact finding necessary to resolve that limited dispute. Should it find for the employer, the appropriate remedy is to order the EEOC to undertake the mandated conciliation efforts.

Monsivaiz v. Los Angeles County Civil Service Commission (County of Los Angeles Department of Agricultural Commissioner/Weights and Measures)

Labor And Employment/Hiring/Firing/Civil Procedure/Jurisdiction And Service Of Process

Civil service commission did not err in dismissing writ proceeding following petitioner ‘s death.

Anderson v. Geist

Civil Rights/Constitutional Law

Peace officer ‘ s execution of warrant was not protected activity under anti-SLAPP statute.

Agam v. Gavra

Residential And Commercial Real Estate/Contracts/Breach

Defendants in contract dispute were properly charged with proving that plaintiff would have incurred claimed reliance damages even in absence of their breach.

In re County of Orange

Civil Procedure/Choice Of Law/Contracts

California law governed enforceability of pre-dispute jury trial waiver where federal law offered less protection of right to jury.

County of Los Angeles Board of Supervisors v. Superior Court (ACLU of Southern California)

Civil Procedure/Discovery

Billing statements sent from counsel to client were privileged communications exempt from disclosure under California Public Records Act.

Nigro v. Sears Roebuck & Co. (9th Cir. 12-57262 amended opn. 4/10/15)

FEHA Disability Discrimination/Admissibility of Self-Serving Declarations

The panel withdrew the opinion filed on February 25, 2015, and replaced it with an amended opinion, and reversed the district court’s summary judgment in favor of Sears, Roebuck and Co. in a former employee’s diversity action alleging disability discrimination claims under California’s Fair Employment and Housing Act.

The panel held that the employee presented triable claims under FEHA: (1) that Sears discriminated against the employee because of his disability; (2) that Sears declined to accommodate the employee’s disability; and (3) that Sears did not engage in an interactive process to determine possible accommodation for the employee’s disability. The panel noted that it was beside the point that some of the employee’s evidence was self-serving because such testimony was admissible, though absent corroboration, it may have limited weight by the trier of fact at trial. The panel further noted that a district court could disregard a self-serving declaration that stated only conclusions and not facts that would be admissible evidence. The panel remanded for further proceedings.

Golden v. California Emergency Physicians


The panel reversed the district court’s order that a settlement agreement be enforced in an employment discrimination action filed by a physician.  The agreement included a provision that the physician waive his rights to employment with the defendant or at any facility that the defendant may own or with which it may contract in the future.

The panel held that the parties’ private party contract dispute regarding whether the no-employment provision voided the settlement agreement was ripe for review under the traditional ripeness standard.

The panel held that the district court abused its discretion in holding that Cal. Bus. & Prof. Code § 16600, which provides that a contract is void if it restrains anyone from engaging in a lawful profession, did not apply solely because the no-employment provision in the settlement agreement did not constitute a covenant not to compete. The panel remanded the case to the district court for further proceedings.

Dissenting, Judge Kozinski wrote that the settlement agreement was not void because the no-employment provision did not limit the physician’s current ability to practice his profession.

Reyes v. Dollar Tree Stores, Inc.

Class Action Fairness Act/Meal & Rest Breaks 

The panel reversed the district court’s order remanding the case to state court, and remanded with instructions for the district court to exercise federal jurisdiction under the Class Action Fairness Act.

Defendant Dollar Tree Stores removed the case from state to federal court in 2012 invoking jurisdiction under CAFA, and the district court granted plaintiff Richard Reyes’ request to remand back to state court because the CAFA $5 million amount-in-controversy requirement was not satisfied. In May 2014, a California superior court certified a broader class and the amount-in-controversy for the class actually certified exceeded $5 million. Dollar Tree again removed to federal court, and the district court found removal untimely because the order was based on the same complaint that was the subject of the first removal.

The panel held that the state court’s class certification order created a new occasion for removal, and the second removal was permissible. The panel also held that the second removal was timely because Dollar Tree removed within thirty days of the class certification order. The panel concluded that because the jurisdictional requirements of CAFA were met, the district court had subject matter jurisdiction.

Jordan v. Nationstar Mortgage LLC

Civil Procedure/Class Actions/Creditors’ And Debtors’ Rights

Defendant timely removed state-court class action under Class Action Fairness Act.

March 2015

Protect Our Benefits v. City and County of San Francisco

Labor And Employment/Employee Benefits/Pensions And Other Retirement Benefits

Amendment of city retirees ‘ right to cost of living increase illegally impaired vested pension rights.

Cline v. Homuth

Torts/Motor Vehicles/Personal Injury

Broad release of claims encompassed negligent supervision claim against adult supervisor of juvenile tortfeasor.

Gallup v. Super. Ct.

Retaliation/Labor Code section 1102.5 

Defendant Superior Court of Nevada County (SCNC) appeals a jury verdict in favor of plaintiff and former employee Emily Gallup.  Gallup brought this action alleging, in part, that SCNC retaliated against her in violation of Labor Code section 1102.5, subdivision (b) for engaging in protected activity when she complained to her supervisor, other court management, and the Administrative Office of the Courts (AOC) that the Family Court Services Department (FCS) was not providing services in compliance with the law, rules, regulations, and policies.  SCNC demurred to this cause of action on the ground Gallup had failed to exhaust her administrative remedies under section 98.7.

The trial court overruled the demurrer, relying on Lloyd v. County of Los Angeles (2009) 172 Cal.App.4th 320.  The case was tried before the jury on the section 1102.5, subdivision (b) cause of action alone, as all Gallup’s other causes of action were disposed of by demurrer or summary judgment.  The jury found in Gallup’s favor, awarding her past economic loss in the amount of $168,206, future economic loss in the amount of $105,000, and past noneconomic loss in the amount of $40,000, for a total of $313,206.

SCNC appeals from the judgment, raising as the only issue the trial court order overruling the demurrer.  We shall conclude that Campbell v. Regents of University of California (2005) 35 Cal.4th 311 (Campbell), is the controlling authority, and shall reverse the judgment.

BNSF Railway Company v. Superior Court (Kralovetz)

Civil Procedure/Jurisdiction And Service Of Process

Texas-based enterprise with no more than eight percent of operations in California was not subject to general personal jurisdiction in California.

Simplon Ballpark, LLC v. Scull

Civil Procedure/Jurisdiction And Service Of Process

Party forfeited reliance on presumption of invalidity of service by failing to properly raise it in trial court.

Young v. United Parcel Service, Inc.

Pregnancy Discrimination Act/Disparate Treatment/Reasonable Accommodation 

An individual pregnant worker who seeks to show disparate treatment through indirect evidence may do so through application of the McDonnell Douglas framework by showing that she belongs to the protected class, that she sought accommodation, that the employer did not accommodate her, and that the employer did accommodate others “similar in their ability or inability to work.” The employer may then seek to justify its refusal to accommodate the plaintiff by relying on “legitimate, nondiscriminatory” reasons for denying accommodation. That reason normally cannot consist simply of a claim that it is more expensive or less convenient to add pregnant women to the category of those whom the employer accommodates. If the employer offers a “legitimate, nondiscriminatory” reason, the plaintiff may show that it is in fact pretextual. The plaintiff may reach a jury on this issue by providing sufficient evidence that the employer’s policies impose a significant burden on pregnant workers, and that the employer’s “legitimate, nondiscriminatory” reasons are not sufficiently strong to justify the burden, but rather—when considered along with the burden imposed—give rise to an inference of intentional discrimination. The plaintiff can create a genuine issue of material fact as to whether a significant burden exists by providing evidence that the employer accommodates a large percentage of nonpregnant workers while failing to accommodate a large percentage of pregnant workers. This approach is consistent with the longstanding rule that a plaintiff can use circumstantial proof to rebut an employer’s apparently legitimate, nondiscriminatory reasons, see Burdine, supra, at 255, n. 10, and with Congress’ intent to overrule Gilbert.

Under this interpretation of the Act, the Fourth Circuit’s judgment must be vacated. Summary judgment is appropriate when there is “no genuine dispute as to any material fact.” Fed. Rule Civ. Proc. 56(a). The record here shows that Young created a genuine dispute as to whether UPS provided more favorable treatment to at least some employees whose situation cannot reasonably be distinguished from hers. It is left to the Fourth Circuit to determine on remand whether Young also created a genuine issue of material fact as to whether UPS’ reasons for having treated Young less favorably than these other nonpregnant employees were pretextual.

Omnicare, Inc. v. Laborers District Council Construction Industry Pension Fund

Securities And Federal Corporate Law/Securities Fraud

U.S. Supreme Court: A company ‘s statement of opinion prior to issuance of stock is not actionable as an “untrue statement of … fact ” simply because the stated opinion later proves to be incorrect, so long as no material facts were omitted regarding the issuer ‘s inquiry into, or knowledge concerning, that statement.

Kohler v. Bed Bath and Beyond of California, LLC

Civil Rights/Administrative Law

9th Circuit: Federal disability law did not require retail store to provide wheelchair user enough room to pull restroom door open.

Navarro v. Encino Motorcars, LLC

Labor And Employment/Wages And Hours/Insurance Law/Automotive

9th Circuit: Car dealership “service advisors ” were not exempt from overtime pay requirements of Fair Labor Standards Act.

Hyundai Motor America v. Superior Court (Rosen)

Consumer Protection/Civil Procedure/Judgments/Insurance Law/Automotive

Minute order awarding attorney fees not “final judgment ” subject to postjudgment interest.

Kohler v. Presidio International, Inc.

Civil Rights/Administrative Law

9th Circuit: Americans with Disabilities Act plaintiff not required to offer expert evidence to establish store counter ‘s height.

Ali v. Rogers

Civil Rights/Admiralty/Labor And Employment/Discrimination/National Origin Discrimination

9th Circuit: Civil rights claims of two Yemeni-born Muslim seamen against private company that operated U.S.-owned ship should have been brought against U.S. government in admiralty.

Amis v. Greenberg Traurig LLP

Alternative Dispute Resolution/Mediation/Legal Profession/Attorney Malpractice

Mediation confidentiality statutes barred client from suing attorneys for malpractice based on their advice to him during mediation.

I-CA Enterprises, Inc. v. Palram Americas, Inc.

Torts/Intentional Torts/Tortious Interference With Contract

No basis for joint and several liability as to two defendants that committed independent tortious acts resulting in plaintiff ‘s loss of profit.

Baker v. Castaldi

Civil Procedure/Judgments/Appellate Law – Civil/Finality

Purported “judgment ” filed by trial court was not final and could not be appealed.

Serafin v. Balco Properties Ltd., LLC (CA1/4  A141358 3/16/15)


Madeline Serafin (Serafin) sued her former employer Balco Properties Ltd., LLC and related individuals and entities[1] (collectively Balco) alleging claims arising from her employment, including wrongful termination, harassment, and defamation.  The trial court granted Balco’s motion to stay the litigation until the completion of binding arbitration based upon an arbitration agreement Serafin signed when she was hired by Balco.  The arbitrator ultimately found in Balco’s favor on all issues, and the trial court granted Balco’s petition to confirm the arbitration award, entering judgment in Balco’s favor.

On appeal, Serafin argues the trial court erred in concluding her claims against Balco were subject to arbitration, contending she never entered into a binding agreement to arbitrate her employment-related claims.  Alternatively, assuming the parties formed an agreement to arbitrate, Serafin contends the arbitration agreement was unenforceable because it was procedurally and substantively unconscionable.  We disagree, and affirm the judgment in Balco’s favor.

Lanquist v. Ventura County Employees’ Retirement (CA2/6  B2511793/16/15)

Retirement Service Credit 

Ventura County Employees’ Retirement Association (VCERA) permits employees to purchase retirement service credit for time spent in military service.  It excludes time spent as a midshipman at the United States Naval Academy (Academy).  Our interpretation of a Ventura County Board of Supervisors’ resolution, adopting the County Employees Retirement Law (CERL), leads us to the opposite conclusion.  “Military service” includes service as a midshipman.  (Gov. Code, § 31450 et seq.)[2]

Ventura County employees Timothy S. Lanquist and Thomas W. Temple appeal a judgment denying their petition for a writ of mandamus to compel VCERA to grant their requests to purchase retirement service credit for military service as midshipmen at the Academy.  We reverse the judgment and direct the trial court to issue a writ of mandamus requiring VCERA to grant their requests.

Alborzian v. JPMorgan Chase Bank

Residential And Commercial Real Estate/Consumer Protection

Junior lienholder’s attempts to collect on unenforceable debt may be actionable if they misrepresent debt’s enforceability.

DeCambre v. Rady Children’s Hospital (CA4/1 D063462 3/11/15)


Marvalyn DeCambre, M.D., appeals a judgment entered after the trial court granted special motions to strike pursuant to Code of Civil Procedure section 425.16 brought by defendants Rady Children’s Hospital-San Diego (RCHSD), Children’s Specialist San Diego (CSSD) and the Regents of the University of California (Regents) (collectively, defendants), and also sustained defendants’ demurrers to certain causes of action in DeCambre’s complaint.  DeCambre, a physician specializing in pediatric urology, filed an action against RCHSD, CSSD and the Regents alleging retaliation, harassment, racial discrimination, failure to prevent discrimination and wrongful termination under the California Fair Employment and Housing Act (FEHA) (Gov. Code, § 12900 et seq.).  DeCambre also brought claims against all defendants for intentional infliction of emotional distress (IIED), defamation, and violations of the Unfair Competition Law (UCL) (Bus. & Prof. Code, § 17200 et seq.) and the Cartwright Act (Bus. & Prof. Code, § 16700 et seq.).  The theme of DeCambre’s complaint is that throughout her tenure at RCHSD, defendants discriminated against her because of her race and gender.

Each defendant filed a special motion to strike DeCambre’s complaint.  The trial court granted the motions in full on the ground that all of DeCambre’s causes of action arose from RCHSD’s decision not to renew its contract for DeCambre’s services, which was the culmination of a peer review process that is protected as an official proceeding authorized by law under section 425.16, subdivision (e).  The court also sustained defendants’ demurrers to DeCambre’s claims for IIED, defamation, unfair competition and violation of the Cartwright Act and denied DeCambre’s request for leave to amend.

On appeal, DeCambre contends that the trial court erred in granting the special motions to strike because the defendants’ peer review process was not entitled to protection under the anti-SLAPP statute and even it was, her claims did not arise from that process.  DeCambre also challenges the resulting attorney fee awards and the trial court’s order sustaining defendants’ demurrers.  We conclude that the trial court erred in granting the defendants’ anti-SLAPP motions as to DeCambre’s claims for harassment and IIED.  These claims do not arise from protected activity under section 425.16 and we reject the defendants’ attempt to cloak them in the protections afforded to peer review proceedings under the anti-SLAPP statute.  Because we reverse this portion of the anti-SLAPP ruling, we also reverse and remand the attorney fee awards.  In addition, we remand with directions that the court determine whether DeCambre should be afforded leave to amend her claim for defamation.

Taylor v. Yee

Civil Rights/Constitutional Law

9th Circuit: Plaintiffs failed to state due process claim in action challenging California State Controller ‘s application of Unclaimed Property Law.

Telish v. California State Personnel Board (California Department of Justice)

Labor And Employment/Hiring/Firing

Conversations recorded at direction of law enforcement were admissible in hearing on employee ‘s termination.

York v. Strong

Civil Procedure/Judgments

Code Civ. Proc. Section 685.040 authorizes post-judgment attorney fees incurred in enforcing judgment for fees awarded for successful defense of SLAPP suit.

Aircraft Service International, Inc. v. International Brotherhood of Teamsters, AFL-CIO, Local 117

Labor And Employment/Labor Law/Strikes

9th Circuit: Employer had to satisfy Norris-Laguardia Act ‘s “clean hands ” provision before seeking anti-strike injunction under Railway Labor Act.

Alterra Excess and Surplus Insurance Company v. Estate of Buckminster Fuller

Insurance Law/Intellectual Property/Trademarks/Infringement (Trademark)

Intellectual property policy exclusion was applicable to unfair competition claims based on unauthorized use of name or likeness.

People v. Superior Court (Cahuenga’s The Spot)

Civil Procedure

Summary judgment may be entered on enforcement actions for violations of state and local laws without immediate determination of penalty issues.

Bean v. Pacific Coast Elevator Corporation

Civil Procedure

Prejudgment interest may not be awarded on costs.

Perez v. Mortgage Bankers Assn.  (US 13–1041 3/9/15)

Administrative Procedure Act Rulemaking/DOL Wage & Hour Division Administrative Exemption 

The Administrative Procedure Act (APA) establishes the procedures  federal administrative agencies use for “rule making,” defined as the process of “formulating, amending, or repealing a rule.” 5 U. S. C. §551(5). The APA distinguishes between two types of rules: So-called “legislative rules” are issued through notice-and-comment rulemaking, see §§553(b), (c), and have the “force and effect of law,” Chrysler Corp. v. Brown, 441 U. S. 281, 302–303. “Interpretive rules,” by contrast, are “issued . . . to advise the public of the agency’s construction of the statutes and rules which it administers,” Shalala v. Guernsey Memorial Hospital, 514 U. S. 87, 99, do not require notice-and?-comment rulemaking, and “do not have the force and effect of law,” ibid.

In 1999 and 2001, the Department of Labor’s Wage and Hour Division issued letters opining that mortgage-loan officers do not qualify for the administrative exemption to overtime pay requirements under the Fair Labor Standards Act of 1938. In 2004, the Department issued new regulations regarding the exemption. Respondent Mortgage Bankers Association (MBA) requested a new interpretation of the revised regulations as they applied to mortgage-loan officers, and in 2006, the Wage and Hour Division issued an opinion letter finding that mortgage-loan officers fell within the administrative exemption under the 2004 regulations. In 2010, the Department again alter edits interpretation of the administrative exemption. Without notice or an opportunity for comment, the Department withdrew the 2006 opinion letter and issued an Administrator’s Interpretation concluding that mortgage-loan officers do not qualify for the administrative exemption.

MBA filed suit contending, as relevant here, that the Administrator’s Interpretation was procedurally invalid under the D. C. Circuit’s decision in Paralyzed Veterans of Am. v. D. C. Arena L. P., 117 F. 3d 579. The Paralyzed Veterans doctrine holds that an agency must use the APA’s notice-and-comment procedures when it wishes to issue a new interpretation of a regulation that deviates significantly from a previously adopted interpretation. The District Court granted summary judgment to the Department, but the D. C. Circuit applied Paralyzed Veterans and reversed.

Held: The Paralyzed Veterans doctrine is contrary to the clear text of the APA’s rulemaking provisions and improperly imposes on agencies an obligation beyond the APA’s maximum procedural requirements.

(a) The APA’s categorical exemption of interpretive rules from the notice-and-comment process is fatal to the Paralyzed Veterans doctrine. The D. C. Circuit’s reading of the APA conflates the differing purposes of §§1 and 4 of the Act. Section 1 requires agencies to use the same procedures when they amend or repeal a rule as they used to issue the rule, see 5 U. S. C. §551(5), but it does not say what procedures an agency must use when it engages in rulemaking. That is the purpose of §4. And §4 specifically exempts interpretive rules from notice-and-comment requirements. Because an agency is not required to use notice-and-comment procedures to issue an initial interpretive rule, it is also not required to use those procedures to amend or repeal that rule.

(b) This straightforward reading of the APA harmonizes with longstanding principles of this Court’s administrative law jurisprudence, which has consistently held that the APA “sets forth the full extent of judicial authority to review executive agency action for procedural correctness,” FCC v. Fox Television Stations, Inc., 556 U. S. 502, 513. The APA’s rulemaking provisions are no exception: §4 establishes “the maximum procedural requirements” that courts may impose upon agencies engaged in rulemaking. Vermont Yankee Nuclear Power Corp. v. Natural Resources Defense Council, Inc., 435 U. S. 519, 524. By mandating notice-and-comment procedures when an agency changes its interpretation of one of the regulations it enforces, Paralyzed Veterans creates a judge-made procedural right that is inconsistent with Congress’ standards.

(c) MBA’s reasons for upholding the Paralyzed Veterans doctrine are unpersuasive.

(1) MBA asserts that an agency interpretation of a regulation that significantly alters the agency’s prior interpretation effectively amends the underlying regulation. That assertion conflicts with the ordinary meaning of the words “amend” and “interpret,” and it is impossible to reconcile with the longstanding recognition that interpretive rules do not have the force and effect of law. MBA’s theory is particularly odd in light of the limitations of the Paralyzed Veterans doctrine, which applies only when an agency has previously adopted an interpretation of its regulation. MBA fails to explain why its argument regarding revised interpretations should not also extend to the agency’s first interpretation. Christensen v. Harris County, 529 U. S. 576, and Shalala v. Guernsey Memorial Hospital, 514 U. S. 87, distinguished.

(2) MBA also contends that the Paralyzed Veterans doctrine reinforces the APA’s goal of procedural fairness. But the APA already provides recourse to regulated entities from agency decisions that skirt notice-and-comment provisions by placing a variety of constraints on agency decision-making, e.g., the arbitrary and capricious standard. In addition, Congress may include safe-harbor provisions in legislation to shelter regulated entities from liability when they rely on previous agency interpretations. See, e.g., 29 U. S. C. §§259(a), (b)(1).

(3) MBA has waived its argument that the 2010 Administrator’s Interpretation should be classified as a legislative rule. From the beginning, this suit has been litigated on the understanding that the Administrator’s Interpretation is an interpretive rule. Neither the District Court nor the Court of Appeals addressed this argument below, and MBA did not raise it here in opposing certiorari.

Chapman v. Pier 1 Imports (U.S.) Inc., DBA Pier 1 Imports #1132

Civil Rights/Constitutional Law

9th Circuit: Retailer ‘ s failure to maintain wheelchair-navigable aisles violated customer ‘ s accessibility rights under Americans with Disabilities Act.

Rush v. Sport Chalet, Inc.

Civil Rights/Landlord/Tenant Law/Civil Procedure/Parties

9th Circuit: Landlord properly joined in Americans with Disabilities Act complaint against retailer.

Plott Nursing Home v. Burwell

Health Law

9th Circuit: Nursing home was entitled to review or dismissal of all cited quality of care violations.

Trabert v. Consumer Portfolio Services, Inc.

Consumer Protection/Alternative Dispute Resolution/Contractual Clauses/Insurance Law/Automotive

Unconscionable arbitration provisions in auto purchase agreement were severable.

Weiland v. American Airlines, Inc.

Labor And Employment/Hiring/Firing

9th Circuit: Pilot who turned 60 only six days before agency rule that required retirement at sixty was abrogated by legislation did not qualify for exception to non-retroactivity.

Acacia Patent Acquisition, LLC v. Superior Court (Reddy)

Legal Profession/Attorney Fee Recovery

Law firm that represented attorney in fee dispute against former client was disqualified from representing third party in similar fee dispute against same client.

Securitas Security Services v. Super. Ct. (CA4/1  D066873 2/27/15)

PAGA Arbitration/Post-Iskanian 

Securitas Security Services USA, Inc. (Securitas) petitions for a writ of mandate and/or prohibition challenging the superior court’s order granting its amended motion to compel arbitration in which the court ordered the parties to arbitrate all of real party in interest Denise Edwards’s claims, including her class action and representative claims under the Private Attorneys General Act of 2004 (PAGA) (Lab. Code, §§ 2698 et seq.).  Securitas contends the court impermissibly rewrote the parties’ written dispute resolution agreement, which contained an express waiver of class, collective or representative claims; it argues the parties did not mutually agree to arbitrate class and/or representative claims and the agreement should have been deemed silent on arbitration of any class or representative action.  It further contends the court erred by refusing to enforce the lawful class action waiver, as well as the PAGA waiver, because as to the latter, Edwards’s waiver was voluntary, rendering the circumstances unlike those in Iskanian v. CLS Transportation (2014) 59 Cal.4th 348 (Iskanian), certiorari denied sub nom. CLS Transportation Los Angeles v. Iskanian (Jan. 20, 2015, No. 14-341) 2015 WL 231976.  Securitas argues that because Iskanian does not apply, the parties’ arbitration agreement should be enforced in its entirety as to Edwards’s individual claims.

We conclude the trial court correctly ruled that Iskanian rendered the PAGA waiver within the parties’ dispute resolution agreement unenforceable.  However, the court then erred by invalidating and severing the waiver provision, including an enforceable class action waiver, from the agreement and sending Edwards’s entire complaint, including her class action and PAGA claims, to arbitration.  Under the plain language of the parties’ agreement, in the event Edwards sought to arbitrate a PAGA claim, her PAGA waiver (or any other waiver of the right to bring a dispute as a class or collectively) was not severable from the remainder of the agreement, thus rendering the entire dispute resolution agreement unenforceable and precluding the court from requiring the parties to arbitrate their disputes.  Though we grant Securitas’s petition to the extent it seeks to set aside the order compelling Edwards’s class and PAGA claims to arbitration, we deny the remainder of its requested relief, and based on our de novo interpretation of the parties’ agreement, direct the trial court to enter a new order denying Securitas’s amended motion to compel arbitration.

Universal Protection Services v. Super. Ct. (CA4/1 D066919 2/27/15) Class/Representative Arbitration

Petitioner Universal Protection Service, L.P. (Universal) petitions for a writ of mandate and/or prohibition challenging the superior court’s order granting real party in interest Floridalma Franco’s demand to arbitrate her employment-related disputes with Universal and ruling the arbitrator would decide the arbitrability of Franco’s class action claims.  Universal contends the court legally erred in its ruling because the parties’ arbitration agreement did not clearly and unmistakably submit arbitrability questions to the arbitrator, and thus it was for the superior court to decide whether the agreement authorized class and/or representative arbitration.

We conclude the court erred by granting Franco’s petition in reliance on Green Tree Financial Corp. v. Bazzle (2003) 539 U.S. 444 (Bazzle).  Nevertheless, we agree with Franco that the parties’ reference to American Arbitration Association (AAA) rules, which unambiguously state that the arbitrator is to decide whether the parties’ arbitration agreement permits class arbitration, constitutes clear and unmistakable evidence of their intent that the arbitrator decide this issue, which is a threshold question of arbitrability.  Because the trial court reached the correct conclusion, we deny the petition.

February 2015

Franco v. Arakelian Enterprises (CA2/1 B232583A 2/26/15)

Arbitration of PAGA Claim Post-Iskanian 

Following the rule announced in Iskanian, we reverse and remand with directions the trial court’s order denying the petition of defendant Arakelian Enterprises, Inc. (Arakelian) to compel arbitration of the plaintiff’s claims for individual and class action relief, and for representative relief under the Labor Code Private Attorneys General Act of 2004 (Lab. Code, §§ 2698-2699.5) (PAGA).

Mies v. Sephora U.S.A. (CA1/1 A139410, filed 2/2/15, pub. Order 2/26/15) Misclassification/Class Certification

Eva Mies seeks to bring a class action against her former employer, Sephora U.S.A., Inc. (Sephora), on behalf of employees who, like her, worked as Specialists in Sephora’s California retail stores.  Mies claims Sephora misclassified Specialists as exempt from certain provisions of California labor law and, as a result, failed to pay overtime wages and failed to compensate them for missed meal periods.  However, after crediting evidence that all Specialists do not engage in the same tasks to the same extent, the trial court denied class certification, concluding individualized issues, not common ones, would predominate the determination of liability.  We conclude the trial court used proper legal criteria in assessing class certification and substantial evidence supports the trial court’s findings.  We therefore also conclude the court did not abuse its discretion in denying class certification.

State of California v. Superior Court (Alvarado)

Torts/Labor And Employment

California Supreme Court: Freeway Service Patrol Act contract did not make California Highway Patrol special employer of contracted tow truck driver.

Mies v. Sephora U.S.A., Inc.

Civil Procedure/Class Actions/Labor And Employment/Wages And Hours

Trial court did not err in denying class certification where evidence supported conclusion that allegedly underpaid workers did not engage in same tasks to same extent.

Lydig Construction, Inc. v. Martinez Steel Corporation

Civil Procedure/Provisional Remedies

Subcontractor’s cross-complaint did not preclude trial court’s grant of general contractor’s application for writ of attachment.

Nigro v. Sears, Roebuck and Co. (9th Cir. 12-57262 2/25/15)

FEHA Disability Discrimination/Self-Serving Declarations Admissible to Oppose Summary Judgment 

The panel reversed the district court’s summary judgment in favor of Sears, Roebuck and Co. in a former employee’s diversity action alleging disability discrimination claims under California’s Fair Employment and Housing Act.

The panel held that the employee presented triable claims under FEHA: (1) that Sears discriminated against the employee because of his disability; (2) that Sears declined to accommodate the employee’s disability; and (3) that Sears did not engage in an interactive process to determine possible accommodation for the employee’s disability. The panel noted that it was beside the point that some of the employee’s evidence was self-serving because such testimony was admissible, though absent corroboration, it may have limited weight by the trier of fact at trial. The panel remanded for further proceedings.

Roy Allan Slurry Seal, Inc. v. Amer. Asphalt So., Inc. (CA2/8 B255558 2/20/15)

Prevailing Wage Violations Resulting in Low Bid for Winning Public Works Contract Not Applicable to Interference with Prospective Economic Advantage Action 

May the second-place bidder on a public works contract state a cause of action for intentional interference with prospective economic advantage against the winning bidder if the winner was only able to obtain lowest bidder status by illegally paying its workers less than the prevailing wage?  We hold that the answer is yes if the plaintiff alleges it was the second lowest bidder and therefore would have otherwise been awarded the contract, because that fact gives rise to a relationship with the public agency that made plaintiff’s award of the contract reasonably probable.

Nothing in the [Public Contract Code] or legislative history suggests the law applies to interference claims based on prevailing wage violations.

Calvo Fisher & Jacob LLP v. Lujan

Contracts/Performance/Legal Profession/Attorney Fee Recovery

Engagement letter supported award of attorney fees incurred in collecting unpaid legal fees.

Grebing v. 24 Hour Fitness USA, Inc.

Torts/Affirmative Defenses/Assumption Of Risk

Health club’s release of liability was applicable to injury resulting from exercise machine failure.

Kohler v. Bed Bath & Beyond Of California, LLC

Civil Rights

9th Circuit: Plaintiff failed to show restroom door was not in compliance with Americans with Disabilities Act Accessibility Guidelines.

Horne v. District Council 16 (CA1/4 A135470A dec. on rem. 2/18/15)

Post-Salas After-Acquired Evidence Doctrine/FEHA Not Preempted by LMRDA

The genesis of this dispute is an employment discrimination action filed by appellant Raymond E. Horne (Horne) in which the trial court granted summary judgment in favor of respondent District Council 16 International Union of Painters and Allied Trades (District Council 16).  In particular, the trial court held that—because Horne was unable to establish that he was qualified for the union organizer position he unsuccessfully sought—he had failed to state a prima facie case of racial discrimination in violation of the California Fair Employment and Housing Act (FEHA).  (Gov. Code, § 12900 et seq.)  On appeal, Horne contends that the trial court improperly considered after-acquired evidence of a prior narcotics conviction in determining that he was ineligible for the organizer job.  Horne also claims that, even if the after-acquired evidence was admissible, the trial court erred in concluding that the conviction disqualified Horne from employment as a union organizer.  District Council 16, for its part, disagrees with Horne’s assertions, argues that his discrimination claim is preempted by the federal Labor-Management Reporting and Disclosure Act (LMRDA), and seeks sanctions from Horne for filing a frivolous appeal.  Upon due consideration, and in light of the holding and rationale in Salas, we reverse the judgment of the trial court.  We also deny District Council 16’s request for sanctions.

Aghaian v. Minassian

Civil Procedure/Venue

Bias against women and non-Muslims rendered Iran unsuitable alternative forum for resolving property dispute.

Assn. for L.A. Deputy Sheriffs v. County of L.A. (CA2/5 B254982 2/17/15)


Cross-defendant and appellant the County of Los Angeles, by and through its Sheriff’s Department and Lee Baca (County), sought to compel individual arbitrations of grievances by certain union employees employed by the Los Angeles County Sheriff’s Department (LASD) and the now defunct Office of Public Safety (OPS) and represented by cross-complainants and respondents the Los Angeles County Professional Peace Officers Association (LAPPOA) and the Associations for Los Angeles Deputy Sheriffs (ALADS) (collectively Unions).  The trial court refused to compel such arbitrations, ruling that Code of Civil Procedure section 1281.2 (section 1281.2) gave it discretion, in the interest of judicial economy, to stay the arbitration of arbitral issues between the parties while it resolved issues between the parties that were not subject to arbitration, which resolution might make arbitrations unnecessary.  Because we hold that all of the issues between the parties were subject to individual arbitrations and therefore the part of section 1281.2 upon which the trial court relied was inapplicable, we reverse.

Belasco v. Wells

Residential And Commercial Real Estate

Homebuyer released and waived all future claims when he settled construction defect dispute with builder.

Nealy v. City of Santa Monica

Labor And Employment/Discrimination/Disability Discrimination

Injured city worker was properly found to be unable to perform the essential functions of his job.

Gerard v. Orange Coast Mem. Medical Center (CA4/3 G048039 2/10/15)

Partial Invalidity of Wage Order/Second Meal Break Waiver 

Three health care workers sued their hospital employer in this putative class and private attorney general enforcement action for alleged Labor Code violations and related claims.  In this appeal, their primary complaint is a hospital policy illegally let health care employees waive their second meal periods on shifts longer than 12 hours.

A statute requires two meal periods for shifts longer than 12 hours.  But an order of the Industrial Welfare Commission (IWC) authorizes employees in the health care industry to waive one of those two required meal periods on shifts longer than 8 hours.  The principal issue before us concerns the validity of the IWC order.

We conclude the IWC order is partially invalid to the extent it authorizes second meal break waivers on shifts longer than 12 hours.  However, with one exception, the retroactive application of our conclusion must be litigated on remand.  We also determine the court incorrectly granted summary judgment and denied class certification.

Baral v. Schnitt

Civil Procedure/Motion Practice/Pre-Trial Procedure

Defendant could not assert anti-SLAPP motion as means to excise allegations from plaintiff’s mixed causes of action.

Marenco v. DirecTV (CA2/4 B238421 2/5/15)

Arbitration/Class Action Waiver

In this putative class action, plaintiff Francisco Marenco contends that defendant DirecTV LLC violated state wage and unfair competition laws.  (Lab. Code, § 212; Bus. & Prof. Code, § 17200 (UCL).)  DirecTV moved to compel arbitration as the successor to an arbitration agreement between Marenco and his previous employer, 180 Connect, Inc., which was acquired by DirecTV.  The trial court granted the motion over Marenco’s objections that DirecTV is not a signatory to the agreement, and that the agreement’s class action waiver is unconscionable under state law.

In this appeal from the judgment (order) staying the class claims and compelling arbitration of the individual claims, we conclude that DirecTV has standing to enforce the agreement, that the agreement’s class action waiver is enforceable under AT&T Mobility LLC v. Concepcion (2011) 563 U.S. ___, 131 S.Ct. 1740 (Concepcion), and that the California Supreme Court’s recent decision in Iskanian v. CLS Transportation Los Angeles LLC (2014) 59 Cal.4th 348 (Iskanian), which was issued while this appeal was pending, is controlling.

Wright v. St. of CA (CA1/2 A139034 1/30/15)

Employee Living on Employer’s Property (workers’ compensation case applicable to employment claims)

Plaintiff Monnie Wright was a correctional officer at San Quentin State Prison (San Quentin), who lived on the San Quentin premises, in a unit he rented from his employer, defendant State of California (State).  Wright was injured when he fell in the course of his lengthy walk from his home to his actual place of work.  Following his injury, Wright sought workers’ compensation, and received it.  He thereafter filed suit against the State, which moved for summary judgment on the ground that workers’ compensation was Wright’s exclusive remedy, an argument based on the “premises line” rule, which provides that the employment relationship commences once the employee enters the employer’s premises.  The trial court agreed and granted the motion.

We reverse, concluding that it was error to hold Wright’s tort claim barred solely because he was on his employer’s premises at the time of his fall, particularly where Wright lived on those very premises.

Anten v. Superior Court (Weintraub Tobin Chediak Coleman Grodin, Law Corporation)

Legal Profession/Attorney Malpractice/Civil Procedure/Discovery

One of three clients who jointly retained attorneys and later singly sued them for malpractice could discover communications between non-suing clients and attorneys

Velasquez v. Centrome, Inc. (CA2/8 B247080 1/30/15)

Jury Instruction re Undocumented Status (torts case applicable to employment claims)

Plaintiff and appellant Wilfredo Velasquez appeals from a judgment after jury trial of his product-related personal injury action.  Velasquez alleged his lung disease was caused by workplace exposure to a chemical compound, diacetyl, that was distributed by defendant and respondent Centrome, Inc. dba Advanced Biotech (Advanced).  The trial court entered judgment on the jury’s special verdict which included findings, as to multiple causes of action, that Advanced’s acts were not a substantial factor in causing harm to Velasquez.

After finding the issue relevant to Velasquez’s ability to receive a lung transplant, the trial judge advised the prospective jurors during jury selection that Velasquez is an undocumented immigrant.  Velasquez claims the jurors who decided his case were incapable of being fair given their knowledge of his immigration status.  We find the trial court erred when it disclosed Velasquez’s undocumented immigrant status to the venire of prospective jurors, and in denying a motion for mistrial.  We find the denial of Velasquez’s motion for mistrial requires that the judgment be reversed.

January 2015

Augustus v. ABM Security Services CA2/1  B243788, filed 12/31/14, pub. ord. 1/29/15)

Duty During Rest Breaks

Plaintiff Jennifer Augustus and others, formerly security guards employed by defendant ABM Security Services, Inc. (hereafter ABM), allege on behalf of themselves and a class of similarly situated individuals that ABM failed to provide rest periods required by California law in that it failed to relieve security guards of all duties during rest breaks, instead requiring its guards to remain on call during breaks.  The trial court certified a class and granted plaintiffs’ motion for summary adjudication, concluding an employer must relieve its employees of all duties during rest breaks, including the obligation to remain on call.  Plaintiffs then moved for summary judgment on the issue of damages, seeking unpaid wages, interest, penalties, attorney fees and an injunction.  Finding no triable issue as to whether ABM was subject to approximately $90 million in statutory damages, interest, penalties, and attorney fees, the court granted the motion.

The summary adjudication and summary judgment orders rest on the premise that California law requires employers to relieve their workers of all duty during rest breaks.  We conclude the premise is false, and therefore reverse the orders.  We affirm the certification order.

Ogden Entertainment Services v. Workers Compensation Appeals Board

Social Services Law/Workers’ Compensation

Denial of employer’s right to cross-examine injured employee at workers’ compensation hearing violated due process.

Richey v. Autonation, Inc.

Labor And Employment/Labor Law/Alternative Dispute Resolution/Arbitration (Adr)/Hiring/Firing

Employee’s violation of employer’s written policy justified arbitration award in employer’s favor.

Cobb v. Ironwood Country Club

Alternative Dispute Resolution/Contractual Clauses

Amendment of club bylaws providing for arbitration after club members filed action against club was ineffective.

Becker v. Mays-Williams

Civil Procedure/Trial/Statute Of Limitations

9th Circuit: Employee-benefit plans’ beneficiary-designation forms were not ERISA “plan documents.”

Maroney v. Iacobsohn

Labor And Employment/Employee Benefits/Pensions And Other Retirement Benefits

Service of notice of entry of judgment by party who later moved for new trial did not trigger jurisdictional deadlines for that motion.

Gray1 CPB, LLC v. SCC Acquisitions, Inc.

Creditors’ And Debtors’ Rights/Civil Procedure/Judgments

Acceptance of payment in full barred creditor from seeking attorney fees incurred in collection efforts.

In re Sussex

Civil Procedure/Judgments/Provisional Remedies/Alternative Dispute Resolution/Arbitration (Adr)

9th Circuit: Clear error for district court to intervene in pending arbitration based on court’s prediction that any award would likely be vacated due to arbitrator’s “evident partiality” under Federal Arbitration Act.

Landers v. Quality Communications (9th Cir. 12-15890 1/26/15)

Fair Labor Standards Act

The panel affirmed the dismissal, pursuant to Rule 8 of the Federal Rules of Civil Procedure, of an action under the Fair Labor Standards Act, alleging failure to pay minimum wages and overtime wages.

The panel held that under Bell Atlantic Corp. v. Twombly,550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009), it is not enough for a complaint under the FLSA merely to allege that the employer failed to pay the employee minimum wages or overtime wages. Rather, the allegations in the complaint must plausibly state a claim that the employer failed to pay minimum wages or overtime wages. Agreeing with the First, Second, and Third Circuits, the panel held that detailed factual allegations regarding the number of overtime hours worked are not required, but conclusory allegations that merely recite the statutory language are not adequate. A plaintiff asserting a claim to overtime payments must allege that she worked more than forty hours in a given workweek without being compensated for the hours worked in excess of forty during that week.

The panel held that the complaint in this case did not state a plausible claim because it did not allege facts showing that there was a specific week in which the plaintiff was entitled to but denied minimum wages or overtime wages.

M&G Polymers USA, LLC v. Tackett

Labor And Employment/Labor Law/Contracts/Collective Bargaining Agreements/Employee Benefits/Pensions And Other Retirement Benefits

U.S. Supreme Court: Sixth Circuit’s reliance on supposition as to intentions of parties to collective bargaining agreement violated ordinary principles of contract law.

Ferguson v. Yaspan

Contracts/Trusts And Estates/Rescission/Formation

Fairness of contract properly determined by looking at contract as whole and not at unfavorable provisions only.

Department of Homeland Security v. MacLean

Labor And Employment/Hiring/Firing

U.S. Supreme Court: Federal air marshall’s disclosure to media that Transportation Security Administration was reducing overnight missions in order to cut costs was not “specifically prohibited by law” under Homeland Security Act.

Bertoli v. City of Sebastopol

Torts/Personal Injury

Trial court applied erroneous standard in deeming pre-litigation California Public Records Act requests to be “clearly frivolous.”

Cruise v. Kroger Co.

Labor And Employment/Labor Law/Alternative Dispute Resolution/Arbitration (Adr)/Contractual Clauses

Employment application’s arbitration clause was itself sufficient to establish that employee and employer agreed to arbitrate employment-related disputes.

Stockton Mortgage, Inc. v. Tope

Residential And Commercial Real Estate/Contracts/Breach

Breach of contract action could not be based on alleged breach of preliminary title report.

Murray & Murray v. Raissi Real Estate Development, LLC

Civil Procedure/Jurisdiction And Service Of Process

Mailing address was not “unknown” to plaintiff merely because personal service could not be effected at that address.

Gonsalves v. Li

Civil Procedure/Discovery

Party could not be compelled to testify regarding responses to pretrial requests for admission.

Mendiola v. CPS Security Solutions (SC S212704 En Banc 1/8/15)

On-Call Time Includes Sleep Time for Hours Worked

Here we hold that, under the California wage order covering security guards, these plaintiffs are entitled to compensation for all on-call hours spent at their assigned worksites under their employer’s control.

We affirm the Court of Appeal’s conclusion that plaintiffs’ on-call time constituted hours worked within the meaning of Wage Order 4 and was subject to the wage order’s minimum wage and overtime provisions.  We reverse the court’s conclusion that state and federal regulations permitted CPS to exclude sleep time from plaintiffs’ 24-hour shifts.

LaCross v. Knight Transportation (9th Cir. 14-56780 1/8/15)

Misclassification/Class Action Fairness Act/Amount in Controversy

The panel reversed the district court’s judgment remanding the putative class action to state court, and held that the defendants Knight Transportation, Inc., and Knight Truck and Trailer Sales had shown that they were entitled under the Class Action Fairness Act to proceed in federal court because they had established the requisite $5 million amount in controversy.

The plaintiff putative class of truck drivers alleged that Knight misclassified them as independent contractors and asserted other labor law violations, and filed their action in California state court. Knight removed the case to federal court and estimated the amount in controversy for reimbursing the drivers’ lease-related and fuel costs to be at least $44 million In Ibarra v. Manheim Investments, Inc., __ F.3d __. No. 14-56779 (9th Cir. Jan. 8, 2015), filed simultaneously with this opinion, the panel held that when a defendant relies on a chain of reasoning that includes assumptions to satisfy its burden to prove by a preponderance of the evidence that the amount in controversy exceeded $5 million, the chain of reasoning and its underlying assumptions must be reasonable.

The panel applied the framework of analysis in Ibarra to defendants’ proof, and concluded that defendants had met their burden of proof because defendants relied on a reasonable chain of logic and presented sufficient evidence to establish that the amount in controversy exceeded $5 million.

Ibarra v. Manheim Investments (9th Cir. 14-56779 1/8/15)

Misclassification/Class Action Fairness Act/Amount in Controversy

The panel vacated the district court’s order remanding the putative class action to state court, and remanded to the district court to allow both parties the opportunity to submit evidence and arguments whether the $5 million amount in controversy requirement under the Class Action Fairness Act had been satisfied where the complaint did not include a facially apparent amount in controversy or may have understated the true amount in controversy.

The plaintiff putative class of employees sued in state court alleging violations of California’s Labor Code, and explicitly alleging that damages did not exceed $5 million. Defendant Manheim Investments, Inc. removed the case to federal court under the Class Action Fairness Act, asserting more than $5 million was at stake based on a “pattern and practice” of labor law violations.

The panel held that because the complaint did not allege that Manheim universally, on each and every shift, violated labor laws by not giving rest and meal breaks, Manheim bore the burden to show that its estimated amount in controversy relied on reasonable assumptions. The panel also held that a remand to the district court was necessary to allow both sides to submit evidence – direct or circumstantial – related to the contested amount in controversy. The panel further held that if the damages assessment included assumptions, the chain of reasoning and the assumptions needed some reasonable ground underlying them. The panel concluded that Manheim relied on an assumption about the rate of its alleged labor law violations that was not grounded in real evidence, and remanded on an open record for both sides to submit proof related to the disputed amount in controversy.

Bower v. Inter-Con Security Systems (CA1/3  A135940 12/31/14)

Wage & Hour Arbitration/Waiver of Class Claims

Defendant Inter-Con Security Systems, Inc. (Inter-Con) appeals from an order denying its petition to compel arbitration of a putative wage and hour class action filed by plaintiff Brian Bower.  Inter-Con contends the trial court erred in finding that it waived its right to compel arbitration by engaging in litigation conduct inconsistent with the right to demand arbitration.  Inter-Con further argues that Bower’s claims should be arbitrated and that the arbitration should be limited in scope to Bower’s individual claims in light of a waiver of class claims contained in the parties’ arbitration agreement.  Because we conclude there was substantial evidence to support the trial court’s finding of waiver, we affirm the order denying the petition to compel.

J.B.B. Investment Partners, Ltd. v. Fair

Internet Law/E-Commerce

Name appended to email not shown to be electronic signature for purposes of Uniform Electronic Transactions Act.

Koval v. Pacific Bell (CA1/1 A139570 12/31/14)

Wage & Hour/Class Certification/Common Questions

Plaintiffs Frank Koval, Mike Williams, Vanmark Strickland, and Donald Washington filed this consolidated class action lawsuit against their employer, defendant Pacific Bell Telephone Company (d.b.a. AT&T California) (Pacific Bell).  They alleged Pacific Bell violated California law by failing to relinquish control over their activities during meal and rest break periods, and moved for class certification.  Relying, in part, on Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004 (Brinker), the trial court concluded plaintiffs failed to show Pacific Bell’s allegedly restrictive policies had been consistently applied to the putative class members.  The court denied class certification on the ground that common questions do not predominate over individual questions, making the class action procedure an inappropriate method for resolving this dispute.  We affirm.

Pierce v. San Mateo County Sheriff’s Department

Civil Rights

County sheriff’s department not “person” for purposes of civil rights claim for damages under 42 U.S.C. section 1983.

Satyadi v. West Contra Costa Healthcare Dist. (CA1/5 A138948 12/31/14)

Retaliation under Labor Code section 1102.5/Exhaustion of Administrative Remedies

After respondent Doctor’s Medical Center (DMC) terminated Carolyn Satyadi’s employment, Satyadi sued DMC, its owner the West Contra Costa Healthcare District (the District), and various DMC officials.  Satyadi claimed she had been fired in retaliation for reporting and refusing to participate in her employer’s allegedly illegal activities.  Her complaint alleged causes of action under Labor Code section 1102.5.

Respondents filed a demurrer, arguing Satyadi had not filed a complaint with the Labor Commissioner under section 98.7 before bringing her action, and thus her suit was barred by her failure to exhaust administrative remedies.  The trial court agreed with respondents, ruling that Campbell v. Regents of University of California (2005) 35 Cal.4th 311 (Campbell) required Satyadi first to seek relief from the Labor Commissioner before filing suit in court.  It therefore entered a judgment dismissing Satyadi’s action, and Satyadi appealed to this court.

While her appeal was pending, the Legislature amended the Labor Code to specify that employees such as Satyadi need not exhaust administrative remedies prior to filing suit for violations of the Labor Code, unless the provision under which suit is brought expressly requires exhaustion.  We asked the parties to brief whether these amendments apply to this appeal.  We conclude they do, and we therefore reverse the judgment and remand the matter for further proceedings on Satyadi’s complaint.

Pregnancy-Related Leave of Absence

FAQ’s Regarding Pregnancy Related Leave of Absence

California’s Pregnancy Disability Leave Act (PDLA) affords pregnant employees the opportunity to take a pregnancy related leave of absence for pregnancy-related disability leaves.  California law protects employees against discrimination or harassment because of an employee’s pregnancy, childbirth or any related medical condition (referred to below as “because of pregnancy”). California also law prohibits employers from denying or interfering with an employee’s pregnancy-related employment rights.

With few exceptions, employers must guarantee the employee’s position for up to 4 months while the employee is disabled as a result of pregnancy.  If the employer has 50 or more employees within a 75-mile radius of the employee, the employer may be required to grant the employee an additional 12 weeks of unpaid time off to bond with the newborn child.  Although pregnancy disability leave is usually unpaid, employees may be eligible for state disability benefits.  Employees may also be eligible for up to 6 weeks of state disability benefits while the employee bonds with the child under California’s Paid Family Leave.

Employers and employees do not always understand their pregnancy leave rights and obligations.  The following answers some of the most common questions employees and employers have regarding California’s pregnancy disability leave law.

Does every employer have to provide pregnancy disability leave?

California’s PDLA is part of the Fair Employment and Housing Act.  Therefore, any business with 5 or more employees is required to comply with the PDLA and provide pregnancy disability leave.

Does the company have to publish or post its PDLA policy?

The PDLA requires employers to publish its PDLA policy in the employee handbook if the employer has a handbook. The PDLA also requires employers to post its PDLA policies in a place where employees can view the poster. The DFEH has created a sample poster employers can use.  There are two versions of the standard DFEH poster, depending on whether the employer has more than 50 employees working within a 75-mile radius.  The poster is typically included with the multi-law poster employers purchase.

The poster, and any PDLA policies, should explain the employee’s leave entitlement rights and obligations, when an employee is entitled to PDLA leave, and what happens to an employee’s benefits while on PDLA leave.

Once an employee notifies the employer that the employee requires time off work due to a pregnancy-related disability, the employer must guarantee in writing that the employee can return to work in the employee’s same position if the employee requests a written guarantee.

What happens to an employee’s health insurance benefits while the employee is on PDLA leave?

Employers are required to continue employee group health coverage during your PDL at the level and under the conditions that coverage would have been provided if the employee had continued in employment continuously for the duration of the PDLA leave.  If an employer normally pays 100% of the medical insurance coverage, then the employer must continue to pay 100% of the medical insurance coverage while the employee is on PDLA leave.  If the employee is responsible for a portion of the medical insurance premiums, then the employee will need to make arrangements to continue to pay her portion of the medical insurance premiums while on the PDLA leave.  If an employee fails to pay her portion of the health insurance premiums while on PDLA, the employer may cease making its payments and offer the employee the opportunity to continue coverage through COBRA.

How much leave is an employee entitled to take under the PDLA?

Employees may take “up to” 4 months of unpaid time off while the employee is disabled as a result of pregnancy.  Once the employee is no longer disabled as a result of pregnancy, the employee must return to work even if the employee has not exhausted the full 4 months of leave.

What if the has exhausted her leave before her doctor releases her to return to work?

Although the PDLA only requires the employer to provide up to 4 months of unpaid leave under the PDLA, if the employee’s medical condition qualifies as a “disability” under state or federal disability discrimination laws the employer may be required to provide additional time off work as a reasonable accommodation for the disability.  For example, some courts have held that post-partum depression is a disability, and employers may be required to provide additional time off work as an accommodation for the disability.

Does PDLA leave have to be taken all at once?

No.  PDLA leave may be taken on an as-needed basis as required by your health care provider, including intermittent leave or a reduced work schedule, all of which counts against your four month entitlement to leave.

What if the employee does not need to take time off work, but requires other accommodations?

The PDLA requires employers to reasonably accommodate medical needs related to pregnancy, childbirth or related conditions.  Some common accommodations include temporarily modifying work duties, providing a stool or chair, allowing more frequent breaks, transferring the employee to a less strenuous or hazardous position (where one is available).  The accommodations are required if medically needed because of the pregnancy, and should be supported by a note from the employee’s health care professional.

Does the PDLA allow an employee to take time off work to bond with the newborn?

No.  Although California employees may be eligible for up to 6 weeks of Paid Family Leave, PFL is not a protected leave.  If the employer has more than 50 employees within a 75-mile radius of the employee, the California Family Rights Act requires the employer to provide up to 12 weeks of unpaid family bonding leave.  So, if the CFRA applies, the employee could take 4 months of unpaid leave under the PDLA while she is disabled as a result of pregnancy, and then take an additional 12 weeks of unpaid family bonding leave under the CFRA.  Depending on whether the employee has any other disabilities, the employer may be required to provide additional time off determined on a case-by-case basis.

What kind of notice should an employee provide prior to taking PDLA leave?

When the need for the leave is foreseeable, the employee should provide at least 30 days’ notice prior to taking the leave.  When the need for the leave is not foreseeable, the employee should notify the employer of the need for the leave as soon as the need becomes known.

What kind of medical documentation is necessary in order to substantiate a pregnancy-related disability leave of absence?

Except in the case of a medical emergency, employers may require written medical certification from a health care provider substantiating the need for the leave before approving the leave.  The medical documentation only needs to provide sufficient information for the employer to determine that the leave of absence is for a pregnancy-related disability, and they type or amount of leave required (e.g., intermittent, estimated length of time, etc.).   The employer must provide at least 15 days for the employee to submit the medical certification.   The employer may also require a certification that you are able to return to work, with or without reasonable accommodations, after you are no longer disabled as a result of the pregnancy.

Are fathers entitled to time off under the PDLA?

No.  The PDLA only applies to employees who are disabled as a result of pregnancy.  Depending on the size of the employer, fathers may be entitled to time off under either the federal Family Medical Leave Act or the California Family Rights Act to help care for the mother of their child or to bond with the child.

Are employers required to provide any accommodations after the child is born?

Yes.  Employers are required to provide a reasonable amount of break time and use of a room or other location in close proximity to the employee’s work area to express breast milk in private.

Can the employer require an employee to use accrued paid sick leave for PDLA leave?

Yes.  An employer can require an employee to use accrued paid sick leave.  The employee can choose to use accrued vacation or other paid time off.

The company is about to go through a layoff.  If the employee takes PDLA leave, can the employer still proceed with the layoff?

Yes.  An employee on PDLA is entitled to the same rights and benefits the employee would have received had the employee not taken the leave of absence.  If the employer can establish that the employee would have been laid off regardless of the PDLA leave, there is no violation of the law.

Hiring the Right Attorney

FAQ’s on Hiring the Right Lawyer

When you are considering taking legal action, it’s important to hire the right attorney for you.  It is important to have an attorney you trust, and one that can provide you the services you need.  The following are some answers to common questions my clients have when hiring a lawyer.

How do I find an attorney?

Searching online for an attorney is one method of finding the right attorney, but choosing an attorney solely on the basis of an advertisement is not always the best idea. Talk to friends, family members, colleagues and your network contacts. They oftentimes have positive or negative experience with specific attorneys that can help refine your search or point you in the right direction. Check online reviews (such as, but be aware that one person’s experience does not guarantee a similar experience.

What things should I be looking for when I hire an attorney?

Consider your needs. You likely want an attorney with experience area of law in your case.  While you may be able to save some money by hiring a less experienced attorney, it may cost you in the end because the less experienced attorney may take more time to do the work, or may make potentially costly mistakes.

Also consider what you are trying to accomplish.  Do you just want advice, or are you already involved in a lawsuit?  Do you want your attorney to be aggressive, or use other tools to resolve your matter? Do you need someone to take the case on a contingency basis or can you afford to pay legal fees? Being clear about what you want will help you find the right lawyer for you.

How many attorneys should I talk to before I make a decision?

That’s going to depend on what you are looking for, and how quickly it takes for you to find the right attorney for you.  You may have a good feeling about the first attorney you meet, or you may need to continue searching for an attorney that fits the qualifications you are looking for.  If you meet with an attorney, even if it’s not one you are going to hire, ask for referrals to other attorneys.  A responsible lawyer will want you to find the right attorney, even if that’s not the attorney you are currently talking to.

Will I have to give my name and the name of the other side? 

Yes.  Attorneys represent a number of clients, and are required to maintain a list of everyone they have represented so they can make sure there is no conflict of interest.  It’s better to find out if there is a conflict of interest early, and the only way to do that is to provide the attorney with the names of any interested parties.

Can I just prepare a written summary and email that to a bunch of attorneys to see who is interested in my case?

I recommend against it.  Although it may be quicker to send out a mass email to several attorneys at once, you don’t know whether the attorney you are sending your summary to will have a conflict.  What would happen if you send the email to an attorney that represents the other side?

While drafting up a summary of what happened and gathering the relevant documents is a good thing to do, I would not send that to a prospective attorney unless the attorney has asked for it.  If a firm’s website gives you the ability to send the attorney an email, keep the description short.  Rather than describing your case in detail, let the attorney know you’d like to talk with someone about a wrongful termination, or your unpaid wages, or whatever short description fits your situation.  A reputable firm will usually try to respond within one business day.

Why do some attorneys charge for the initial consultation and others don’t?

Attorneys have a variety of ways of handling initial consultations.  Some, like our firm, use the initial consultation to understand your case, analyze your legal and practical issues, and advise you regarding the various options available to you.  We focus on educating our clients so they can make informed decisions about how to proceed. To do it right, this takes time.  An attorney’s skill is reviewing your matter and analyzing your situation based on the law, and creating a solution to your problems.  Much like a doctor will charge you to examine the mole on the back of your neck to determine how to treat it, an attorney may want to charge you for providing the tools of his/her trade.

Is there anything I should do to prepare for the initial consultation?

Prepare a list of questions and, if practical, a short summary of the information you want the attorney to consider.  Even before you contact the attorney, make a list of questions you want answered. That way the attorney can be sure to answer any questions you might have.

It is also important to be extremely candid with the attorney.  Every case has good facts and bad facts.  Some clients don’t want to tell the attorney all the facts, because they are concerned the attorney will be less interested in the case. If you only tell the attorney the good facts, then the attorney cannot do his/her job.  Imagine asking a doctor to give you advice about your child’s cold, but deciding not to tell the doctor that the child has been vomiting and has a fever of 103. Like your doctor, an attorney can better assist you if you tell the attorney everything.

Remember, everything you tell the attorney is confidential.

How does the attorney get paid?

That depends on your agreement with the attorney.  Attorneys will typically work on an hourly basis, a contingency basis or a flat fee basis.  There are other fee alternatives, but those are the most common.  It’s a good idea to ask the attorney up front about the fees.  Even if an attorney charges for the initial consultation, he/she may be willing to represent you on a contingency or other fee basis.

Once you’ve agreed on a fee structure, get it in writing.  Most attorneys have standard fee agreements they use, although the fee agreements will differ from firm to firm.  Read the entire fee agreement, and ask questions about anything you don’t understand.  It’s the attorney’s job to help you understand your legal questions.  Starting the relationship with questions about how the attorney will be compensated could lead to problems down the road.

Do I Need to Hire an Attorney for Labor Commissioner Claims?

Do I Need an Attorney at the Labor Commissioner’s Office?

Employees that believe they are owed unpaid wages or expenses can file a claim with the Division of Labor Standards Enforcement—aka the Labor Commissioner.  The Berman Hearing process, as it is called, is set up so the parties can represent themselves.  Oftentimes, however, parties will be represented.

Why Would Someone Want to Hire an Attorney for Labor Commissioner Claims?

There are many reasons participants hire an attorney for Labor Commissioner claims:

  • Although the process is fairly straightforward, having an advocate familiar with the Labor Commissioner process will help you identify the important facts and documents that you will enable you to prevail at the hearing.
  • Having an experienced wage and hour attorney advise you regarding your options and likely outcome will help you make better decisions regarding what to do in your particular situation.
  • Knowing someone is in your corner giving you the best chance to succeed will enable you to focus on the facts that really matter.
  • When the other side is represented, having your own attorney fighting for you can help balance the scales and help you avoid costly mistakes.
  • A qualified attorney will meet with you before the hearing and explain the process so you can be adequately prepared.
  • Hiring an experienced attorney to represent you at the Labor Commissioner will enable the attorney to better advise you should one side appeal the Labor Commissioner, because the attorney will be familiar with the facts and evidence and be able to advise you regarding the likely outcomes during the appeal.

Robert Nuddleman has been representing employers and employees before the Labor Commissioner since he was in law school.  He has represented hundreds of clients in a wide variety of Labor Commissioner claims, including claims alleging unpaid minimum wage, unpaid overtime, missed meal and rest breaks, unpaid commissions and bonuses, unpaid expenses, vacation pay, liquidated damages under Labor Code section 1194.2, waiting time penalties under Labor Code section 203.

Although you may be able to represent yourself at the Labor Commissioner’s office, hiring an attorney familiar with the wage and hour laws and the Labor Commissioner process will increase your chance of success.  Whether you need to hire an attorney to represent you at the informal conference or the hearing, or if you just need an attorney to review your matter and advise you regarding your options and the best way to improve your chance of success, Robert Nuddleman can help you succeed.