Jose Mayorga v. Evans Food Group LTD

Filing 29

ORDER by Judge Dale S. Fischer DENYING Mayorga's Motion for Remand and Request for Attorneys' Fees (Dkt. 12 ). Evans has established by a preponderance of the evidence that the amount in controversy exceeds $5 million. Plaintiff's Motion to Remand and Request for Attorneys Fees is DENIED. (jp)

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

JOSE MAYORGA, on behalf of
himself and others similarly
situated,
Plaintiff,

No. 2:24-cv-05584-DSF-MAA
Order DENYING Mayorga’s
Motion for Remand and Request
for Attorneys’ Fees (Dkt. 12)

v.
EVANS FOOD GROUP LTD; and
DOES 1 to 100, inclusive,
Defendants.

Defendant Evans Food Group LTD removed this action under the
Class Action Fairness Act (CAFA), 28 U.S.C. § 1332(d)(2). Dkt. 1
(NOR) ¶ 8. Plaintiff Jose Mayorga moves for remand. The Court
deems this matter appropriate for decision without oral argument. See
Fed. R. Civ. P. 78; Local Rule 7-15. For the reasons stated below, the
motion is DENIED.
I. Background
Mayorga filed this putative class action in California Superior
Court, County of Los Angeles. Dkt. 20-1 (Liao Decl., Ex. A) (FAC).
Mayorga brings claims for (1) unpaid minimum wage; (2) unpaid
overtime wages; (3) unpaid meal period premiums; (4) unpaid rest
period premiums; (5) unreimbursed business expenses; (6) failure to
provide accurate wage statements; (7) failure to timely pay final wages
upon termination; and (8) unlawful business acts and practices.

II. Legal Standard
CAFA gives federal courts jurisdiction over class actions
involving at least 100 class members where there is minimal diversity
and at least $5 million in controversy. 28 U.S.C. § 1332(d). “Congress
designed the terms of CAFA specifically to permit a defendant to
remove certain class or mass actions into federal court . . . [and]
intended CAFA to be interpreted expansively.” Ibarra v. Manheim
Invs., Inc., 775 F.3d 1193, 1197 (9th Cir. 2015). In a notice of removal,
the defendant need only plausibly allege that the prerequisites are met.
Dart Cherokee Basin Operating Co. v. Owens, 574 U.S. 81, 89 (2014).
Once confronted with a motion to remand, however, the defendant
bears the burden of establishing jurisdiction by a preponderance of the
evidence. Id. at 88. Both “parties may submit evidence outside the
complaint, including affidavits or declarations, or other summaryjudgment-type evidence relevant to the amount in controversy at the
time of removal.” Ibarra, 775 F.3d at 1197 (cleaned up). There is no
presumption against removal under CAFA. Dart Cherokee, 574 U.S. at
89 (“no antiremoval presumption attends cases invoking CAFA, which
Congress enacted to facilitate adjudication of certain class actions in
federal court”).
III. Discussion
The parties dispute the amount in controversy element of CAFA
jurisdiction. Dkt. 12 (Mot.) at 8. Evans contends the amount in
controversy is $7,252,457.89, broken down as follows:
Claim
Meal and Rest Period Premiums
Waiting Time Penalties
Wage Statement Penalties
Unpaid Overtime
Unpaid Minimum Wage
Unreimbursed Business Expenses
Sub-Total
Attorneys’ Fees (25% of Sub-Total)
Total

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Amount in Controversy
$4,070,407.60
$246,780
$324,000
$610,561.14
$327,547.57
$222,670
$5,801,966.31
$1,450,491.58
$7,252,457.89

Dkt. 20 (Opp’n) at 20. Mayorga argues that Evans has not sufficiently
established these amounts.
A.

Meal and Rest Period Premiums

California Labor Code § 226.7(b) provides that “[a]n employer
shall not require an employee to work during a meal or rest or recovery
period[.]” An employer who fails to provide an employee with a meal or
rest or recovery period required by state law must pay the employee
“one additional hour of pay at the employee’s regular rate of
compensation for each workday that the meal or rest or recovery period
is not provided.” Cal. Labor Code § 226.7(c). Employers are required
by law to provide an employee a meal period of not less than 30
minutes for a work period of more than five hours, and a second meal
period of not less than 30 minutes for a work period of more than ten
hours. Cal. Labor Code § 512(a). Further, employers must “authorize
and permit all employees to take rest periods” at the rate of ten
minutes for every four hours—or major fraction thereof—worked.
Wage Order 4 § 12. Mayorga seeks to recover unpaid premium wages
for failure to provide legally required meal and rest periods over a
period of four years. FAC ¶¶ 48, 79, 88.
Evans calculated the meal break premium amount in controversy
by first determining that the company had “approximately 156 nonexempt employees in California within the putative class who worked
approximately 22,267 work weeks during” the statutory period. NOR
¶ 38 (citing Dkt. 1-5 (Altman Decl.) ¶ 9). Evans then used company
payroll and human resources data to determine that the average shift
length for those employees was 8.59 hours per day, and that those
employees worked an average of 5 days per week. Opp’n at 14 (citing
Dkt. 20-2 (Altman Supp. Decl.) ¶ 4). Using the average hourly rate of

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pay for those employees ($18.28)1 and assuming that putative class
members missed 5 meal periods per workweek, Evans calculated the
amount placed in controversy by Mayorga’s meal period claims as being
$2,035,203.80 ($18.28 x 5 meal periods x 22,267 work weeks). NOR
¶ 37; Opp’n at 15. For the rest period premium amount, Evans applied
the same methodology ($18.28 x 5 rest periods x 22,267 work weeks) to
calculate an amount in controversy of $4,070,407.68 for both claims.
Id.
Mayorga argues that it is unreasonable for Evans to assume,
without evidence, a 100% violation rate. Mot. at 16-17. But Mayorga
alleges that Evans employed “policies, practices, and/or procedures”
that required Mayorga and the putative class to “remain on-duty”
during meal and rest periods due to the company’s requirement” that
they keep a company “cell phone on them and monitored at all times
during their shift including during off the clock meal breaks so they can
[ ] take calls from management and coworkers while off the clock
during meal breaks.” FAC ¶ 28. Mayorga further alleges that Evans
“employed policies and procedures that ensured that employees did not
receive any meal period premium wages to compensate them for
workdays in which they did not receive all legally required and
compliant meal periods.” Id. ¶ 29. And while Mayorga notes that there
may have been “occasions” when Evans paid premium wages, Mayorga
still contends that those payments were insufficient. Id. ¶ 30. Mayorga
alleges that these same policies, practices, and procedures were
adopted as to rest periods. See id. ¶¶ 34-36.
These allegations describe a uniform practice of meal and rest
period violations, and courts in this district have concluded that
assuming a 100% violation rate is reasonable based on similar
allegations. Alvarez v. Off. Depot, Inc., No. 2:17-CV-07220-PSG-AFM,
2017 WL 5952181, at *3 (C.D. Cal. Nov. 30, 2017) (“Given Plaintiff’s

Evans used company payroll and human resources data to determine that
“the average non-exempt employee working in California [ ] earned an
average of $18.28 per hour” during the statutory period. Altman Decl. ¶ 9.

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allegation that he and his fellow class members never received
compliant meal or rest periods because they were ‘on-call’ at all times, a
100 percent violation rate can be reasonably assumed.”) (collecting
cases).
Moreover, Mayorga “fails to assert any different rate of violation
or to submit any evidence indicating a contrary rate of violation.”
Unutoa v. Interstate Hotels & Resorts, Inc., No. 2:14-CV-09809-SVWPJW, 2015 WL 898512, at *3 (C.D. Cal. Mar. 3, 2015). Instead,
Mayorga contends that without “evidence that every single one of
Defendant’s employees missed every single one of their meal and rest
breaks, there is no basis for Defendant’s” assumed violation rate. Mot.
at 16. The Court does not agree. While it is true that “the burden of
demonstrating the reasonableness of the assumptions on which the
calculation of the amount in controversy was based remain[s] at all
times with” the defendant, in doing so “a defendant may rely on
reasonable assumptions . . . [and] need not make the plaintiff’s case for
it or prove the amount in controversy beyond a legal certainty.” Harris
v. KM Indus., Inc., 980 F.3d 694, 701 (9th Cir. 2020) (cleaned up).
Indeed, “a CAFA defendant’s amount in controversy assumptions in
support of removal will always be just that: assumptions.” Jauregui v.
Roadrunner Transportation Servs., Inc., 28 F.4th 989, 993 (9th Cir.
2022) (emphasis in original). Because assumptions are “inescapable at
this early stage of the litigation, the removing party must be able to
rely on a chain of reasoning that includes assumptions to satisfy its
burden[,] . . . as long as the reasoning and underlying assumptions are
reasonable.” Id. (cleaned up).
Considering the evidence submitted by Evans and Mayorga’s
broad allegations and failure to provide any rebutting evidence or
contrary violation rate, an assumed violation rate of five missed meal
periods and five missed rest periods per work week is reasonable. The
Court finds Evans has proven by a preponderance of the evidence that
the meal and rest period premium claims place $4,070,407.60 in
controversy.

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B.

Waiting Time Penalties

An employer’s failure to timely pay wages owed pursuant to
sections 201 or 202 of the Labor Code results in a penalty in the
amount of the employee’s wages for every day that payment is late, up
to a maximum of thirty days’ wages. Cal. Labor Code § 203. Evans
adopts the thirty-day maximum for its waiting time penalties
calculation. NOR ¶ 49; Opp’n at 16-17. The statute of limitations for a
waiting time penalties claim under sections 201 and 202 is three years.
See Pineda v. Bank of Am., N.A., 50 Cal. 4th 1389, 1401 (2010); Cal.
Civ. Proc. Code § 338(a). Evans calculates the amount in controversy
by multiplying the average hourly rate ($18.28), average hours worked
per day rounded to the nearest hour (9.0), total terminated employees
within the limitation period (50), and the maximum penalty period (30)
to arrive at $246,780 in controversy. NOR ¶ 49; Opp’n at 16-17.
Mayorga again disputes the reasonableness of Evans’ assumed
100% violation rate, arguing that there is no evidence to support such a
rate. Mot. at 17-19. But, considering the analysis in Jauregui v.
Roadrunner Transportation Services, 28 F.4th at 993-94, an
assumption may be reasonable even without supporting evidence. In
Jauregui, the circuit held that “the district court erred in its amount in
controversy analysis by assigning a $0 valuation to several claims[.]”
Id. at 991. As an example of its “inappropriate demand of certitude
from [the defendant] over its assumptions used in calculating the
amount in controversy[,]” id. at 993, the circuit pointed to the district
court’s analysis of the waiting time penalty claims:
As one example, the court rejected Roadrunner’s
assumption that each terminated employee would have
been entitled to the maximum 30-day waiting time penalty
because Roadrunner “provides no evidence” supporting that
fact. But it was not unreasonable for Roadrunner to
assume that the vast majority (if not all) of the alleged
violations over the four years at issue in this case would
have happened more than 30 days before the suit was filed,
which would entitle the employees to the 30-day penalty.

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The fact that a very small percentage of employees might
possibly not be entitled to the maximum penalty is not an
appropriate reason to dismiss altogether Defendant’s
estimate for this claim.
Id. at 993-94. Although Evans perhaps overstates the holding of
Jauregui, the Court finds the above reasoning controlling.
Mayorga broadly alleges that Evans failed to pay all meal and
rest period premiums, overtime wages, and minimum wage for all
hours worked. FAC ¶ 151. If Mayorga were to prove these claims, it
would logically follow that Evans failed to pay all wages owed, and it
“was not unreasonable for [Evans] to assume that the vast majority (if
not all) of the alleged violations . . . would have happened more than 30
days before the suit was filed[.]” Jauregui, 28 F. 4th at 994.
The Court finds that the waiting time penalty claim places
$246,780 in controversy.
C.

Wage Statement Penalties

“An employee suffering injury as a result of a knowing and
intentional failure by an employer” to provide accurate wage
statements under Labor Code § 226(a) “is entitled to recover the
greater of all actual damages or fifty dollars ($50) for the initial pay
period in which a violation occurs and one hundred dollars ($100) per
employee for each violation in a subsequent pay period, not to exceed
an aggregate penalty of four thousand dollars ($4,000)[.]” Cal. Labor
Code § 226(e)(1). The statute of limitations for penalties under section
226(e)(1) is one year.
Evans calculated the wage statement penalty amount in
controversy by applying the $4,000 maximum statutory penalty to the
approximately 81 non-exempt employees employed in California during
the entire statutory period for a total of $324,000. NOR ¶ 43-44; Opp’n
at 15.
Mayorga argues that there is no basis to support Evans’
assumption that all “81 non-exempt employees who received wage
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statements received inaccurate ones.” Mot. at 17. But in assessing the
amount in controversy, a court “accepts the allegations contained in the
complaint as true and assumes the jury will return a verdict in the
plaintiff’s favor on every claim.” Henry v. Cent. Freight Lines, Inc., 692
F. App’x 806, 807 (9th Cir. 2017). If Mayorga’s broad allegations of
failure to pay all wages—whether through unpaid meal and rest period
premiums, overtime, or minimum wage—are true, FAC ¶¶ 150-53, then
Evans also would have failed to issue accurate wage statements
showing all hours worked. Having been presented with no evidence
that would suggest a narrower reading of the allegations, the Court
finds Evans was justified in its use of a 100% violation rate. And
because Mayorga and the putative class were paid weekly, Opp’n at 15,
it was reasonable to calculate the amount in controversy using the
maximum penalty.
The Court finds that the wage statement penalty claim places
$324,000 in controversy.
D.

Unpaid Overtime

Labor Code § 510(a) provides that “[a]ny work in excess of eight
hours in one workday and any work in excess of 40 hours in any one
workweek . . . shall be compensated at the rate of no less than one and
one-half times the regular rate of pay for an employee.” Mayorga seeks
to recover unpaid overtime wages for failure to provide legally required
meal and rest periods over a period of four years. FAC ¶¶ 48, 70.
Evans calculated the unpaid overtime amount in controversy by
assuming one hour of unpaid overtime per week for each of the 156
non-exempt California employees in the putative class. NOR ¶ 31-32;
Opp’n at 13. Using the average hourly rate of those employees and
counting approximately 22,267 total work weeks within the statutory
period, Evans determined the amount in controversy for Mayorga’s
unpaid overtime claim to be more than $610,561.14 ($18.28 x 1.5
overtime rate x 1 unpaid hour x 22,267 work weeks). Id.
Mayorga argues that there is no basis to assume one hour of
unpaid overtime per employee per week because he “does not allege—

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and there is no evidence—that every single one of [Evans’] non-exempt
employees earned ‘shift differential pay.’” Mot. at 15-16. But this line
of argument fails to consider many of Mayorga’s allegations and does
not contend with the evidence Evans submitted regarding the length of
an average shift and an average workweek.
Mayorga does not merely base his unpaid overtime claims on his
allegations regarding shift differential pay. He also alleges that Evans,
by policy, practice, and procedure, required the putative class to
“remain on-duty during their off-the-clock meal breaks . . . [and] to take
calls from management and coworkers while off the clock after clocking
out for the end of their shift.” FAC ¶ 64. And Mayorga broadly
contends that himself and the putative class “were not paid for this
time” and that, where that unpaid time resulted in overtime hours,
Evans “failed to pay them at their overtime rate of pay for all the
overtime hours they worked.” Id. ¶¶ 65-66.
Evans submitted additional evidence based on company payroll,
timekeeping, and human resources data, which demonstrated, based on
a large sample of the timekeeping records during the statutory period
of 71 non-exempt California employees, that employees worked an
average of 8.59 hours per day, an average of 5 days per week, and an
average of 42.44 hours per week. Altman Supp. Decl. ¶ 4. By declining
to file a reply, Mayorga has failed to dispute the accuracy of this data.
The assumption of one hour of unpaid overtime per employee per
week is reasonable considering the undisputed timekeeping data and in
light of Mayorga’s broad allegations. The Court finds that the unpaid
overtime claim places $610,561.14 in controversy.
E.

Unpaid Minimum Wage

Any employee who receives less than the legal minimum wage is
entitled to recover any unpaid minimum wage pursuant to Labor Code
§ 1194(a). Mayorga seeks to recover unpaid minimum wage for a
period of four years, alleging that Evans failed to pay all wages earned
at the applicable minimum wage for all hours worked due to the
company’s policies, practices, and procedures, which included requiring

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the putative class to “remain on-duty during their off-the-clock meal
breaks . . . [and] to take calls from management and coworkers while
off the clock after clocking out for the end of their shift.” FAC ¶¶ 15,
48.
Evans calculates the amount in controversy of this claim by
determining the average minimum wage during the statutory period
($14.71) and assuming one hour of unpaid minimum wage per
employee per week (22,267), resulting in a total of $327,547.57. Opp’n
at 18. Mayorga does not dispute Evans’ calculation.2 The Court finds
Evans’ estimate appropriate.
F.

Unreimbursed Business Expenses

Labor Code § 2802(a) requires an employer to “indemnify his or
her employee for all necessary expenditures or losses incurred by the
employee in direct consequence of the discharge of his or her duties[.]”
Mayorga alleges that Evans “employ[ed] policies, practices, and/or
procedures of impermissibly passing business-related expenses” on to
Mayorga and the putative class, including through requiring them to
use their personal cell phone for work purposes without
reimbursement. FAC ¶ 91. Mayorga seeks to recover full
indemnification for these expenditures for a period of four years. Id.
¶¶ 48, 96.
Evans calculates the amount in controversy of this claim by
approximating $10 in improper cell phone expenses per pay period,
placing $222,670 in controversy. Opp’n at 19. Mayorga does not
dispute Evans’ calculation. The Court finds Evans’ estimate
appropriate.

In the Notice of Removal, Evans’ calculation of the amount in controversy
did not include Mayorga’s claims for unpaid overtime or unpaid business
expenses. NOR ¶ 53. Because Mayorga declined to file a reply, he has failed
to dispute Evans’ calculations for those claims.
2

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G.

Attorneys’ Fees

Mayorga claims that he is entitled to recover attorneys’ fees on
his first, second, fifth, sixth, and eighth causes of action. FAC ¶¶ 57,
70, 96, 157, 171. It is well-established that attorneys’ fees are properly
included in a calculation of the amount in controversy for diversity
jurisdiction purposes. Fritsch v. Swift Transportation Co. of Arizona,
LLC, 899 F.3d 785, 794 (9th Cir. 2018) (“We have long held . . . that
attorneys’ fees awarded under fee-shifting statutes or contracts are
included in the amount in controversy.”).
Because Evans has demonstrated by a preponderance of the
evidence that the amount in controversy without attorneys’ fees
exceeds $5 million, the Court need not decide whether it agrees with
Evans’ approach to the calculation of those fees. It suffices to note that
a reasonable amount of fees based on the damages amount calculated
above brings the amount in controversy comfortably over the threshold
required by CAFA.
IV. Conclusion
Evans has established by a preponderance of the evidence that
the amount in controversy exceeds $5 million. Plaintiff’s Motion to
Remand and Request for Attorneys’ Fees is DENIED.

IT IS SO ORDERED.

___________________________
Dale S. Fischer
United States District Judge

Date: August 30,2024

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