Carag v. Barnes & Noble, Inc. et al

Filing 11

ORDER signed by Judge John A. Mendez on 5/30/2014 GRANTING plaintiff's 3 Motion to Remand. Plaintiff's 4 Motion to Strike portions of defendants' Answer is DENIED without prejudice. [cc: Sacramento County Superior Court / case # 34-2013-00155179] (Marciel, M)

1
2
3
4
5
6

UNITED STATES DISTRICT COURT

7

EASTERN DISTRICT OF CALIFORNIA

8
9
10

CASSANDRA CARAG, individually
and on behalf of other
members of the general public
similarly situated,

11
Plaintiff,
12

No.

2:14-cv-00481-JAM-DAD

ORDER GRANTING PLAINTIFF’S
MOTION TO REMAND AND DENYING
PLAINTIFF’S MOTION TO STRIKE

v.
13
14
15
16

BARNES & NOBLE, INC., a
Delaware corporation; BARNES
& NOBLE BOOKSELLERS, INC., a
Delaware corporation; and
DOES 1 through 100,
inclusive,

17

Defendants.

18
This matter is before the Court on Plaintiff Cassandra

19
20

Carag’s (“Plaintiff”) Motion to Remand (Doc. #3) and Motion to

21

Strike (Doc. #4) portions of Defendants Barnes & Noble, Inc.

22

(“Barnes & Noble”) and Barnes & Noble Booksellers, Inc.’s

23

(collectively “Defendants”) Answer (Doc. #1-1). 1

24

opposed the motions (Doc. ##6, 5 respectively).

25

replies (Doc. #7, 8).

Defendants
Plaintiff filed

26
27
28

1

This motion was determined to be suitable for decision without
oral argument. E.D. Cal. L.R. 230(g). The hearing was scheduled
for April 23, 2014.
1

1

I.

2

FACTUAL ALLEGATIONS AND PROCEDURAL BACKGROUND

The class action Complaint (Doc. #1-1) was filed in the

3

Sacramento County Superior Court on November 27, 2013.

4

brought the following claims against Defendants on her own

5

behalf, as well as that of other members of the general public

6

similarly situated:

7

§§ 510 and 1198 (unpaid overtime); (2) Violation of §§ 226.7 and

8

512(a) (Unpaid Meal Period Premiums); (3) Violation of § 226.7

9

(Unpaid Rest Period Premiums); (4) Violation of §§ 1194, 1197,

10

and 1197.1 (Unpaid Minimum Wages); (5) Violation of §§ 201 and

11

202 (Final Wages Not Timely Paid); (6) Violation of § 204 (Wages

12

Not Timely Paid During Employment); (7) Violation of § 226(a)

13

(Non-Compliant Wage Statements); (8) Violation of § 1174(d)

14

(Failure to Keep Requisite Payroll Records); and (9) Violation of

15

California Business & Professions Code §§ 17200, et seq. (Unfair

16

Competition/Unfair Business Practices).

17

Plaintiff

(1) Violation of California Labor Code 2

According to the Complaint, Defendants are a national book

18

retailer operating a chain of bookstores.

19

hourly-paid, non-exempt employee of Defendants from approximately

20

May 2002 through April 2012.

21

“all current and former California-based . . . hourly-paid or

22

non-exempt individuals employed by any of the Defendants at a

23

‘Barnes & Noble’ store located within the State of California at

24

any time during the period from four years preceding the filing

25

of this Complaint to final judgment.”

26

recover the unpaid overtime compensation, compensation for missed

Plaintiff was an

The proposed class is defined as

The Complaint seeks to

27
2

28

All further statutory references are to the California Labor
Code unless otherwise specified.
2

1

meal and rest periods, payment and penalties for unpaid minimum

2

wages, penalties for untimely payment of wages during employment

3

and final wages, damages for improper wage statements and payroll

4

records, and attorneys’ fees.

5

On February 13, 2014, Defendants removed the action to this

6

Court (Doc. #1) pursuant to 28 U.S.C. § 1332(d), the Class Action

7

Fairness Act of 2005 (“CAFA”).

8

Notice of Removal that the alleged aggregate amount in

9

controversy in this class action exceeds $5,000,000, exclusive of

Defendants asserted in their

10

interest and costs, thus satisfying the amount in controversy

11

requirement of 28 U.S.C. § 1332(d)(2) and supplying this Court

12

with jurisdiction over the matter.

13

Defendants submitted the declaration of Barnes & Noble’s Director

14

of Human Resources Administration (Doc. #1-3), Patricia Woloshin-

15

Williams (“Woloshin-Williams”), in which she states that based on

16

a search of the relevant records she discovered that at least

17

3,666 individuals worked as hourly or non-exempt employees at

18

Barnes & Noble in California since November 2013.

To support their contention,

19
20

II.

OPINION

21

A.

Request for Judicial Notice

22

Defendants request the Court judicially notice (Doc. #6-1)

23

three documents pursuant to Rule 201 of the Federal Rules of

24

Evidence.

25

a fact that is not subject to reasonable dispute because it is

26

generally known within the trial court's territorial

27

jurisdiction; or can be accurately and readily determined from

28

sources whose accuracy cannot reasonably be questioned.

Rule 201 provides that the Court may judicially notice

3

1

The first two documents in Defendants’ request are the

2

Complaint and the notice of removal in this action.

3

clearly documents the Court will rely on in ruling on the

4

motions, and as such, the request is granted as to them.

5

These are

The final document is a complaint filed in another action in

6

the Los Angeles County Superior Court.

Although the Court can

7

judicially notice complaints filed in other courts for the fact

8

that they were therein filed, the Court does not find this

9

document to be materially relevant to the matter before it.

10

Accordingly, Defendants’ request as to this other complaint is

11

denied.

12

B.

13
14

Motion to Remand
1.

Applicable Standard

In her Motion to Remand, Plaintiff contends the Court should

15

remand the matter because Defendants have failed to prove that

16

the amount in controversy exceeds $5,000,000, as required for

17

federal jurisdiction under CAFA.

18

Defendants’ calculations rely on speculation and unsubstantiated

19

assumptions, and thus Defendants have failed to meet their burden

20

for removing this action.

21

MTR at p. 2.

She argues

CAFA gives the district courts original jurisdiction in any

22

civil action where: (1) “the matter in controversy exceeds the

23

sum or value of $5,000,000, exclusive of interest and costs,”

24

(2) the action is pled as a class action involving more than 100

25

putative class members, and (3) “any member of a class of

26

plaintiffs is a citizen of a State different from any defendant.”

27

28 U.S.C. § 1332(d).

28

challenged by Plaintiff here.

The first requirement is the only one

4

1

Where a state court complaint does not specify an amount of

2

damages to demonstrate federal jurisdiction, “[a] defendant

3

seeking removal of a putative class action must demonstrate, by a

4

preponderance of evidence, that the aggregate amount in

5

controversy exceeds the jurisdictional minimum.”

6

& T Mobility Services LLC, 728 F.3d 975, 976 (9th Cir. 2013); see

7

also Emmons v. Quest Diagnostics Clinical Labs., Inc., 1:13-CV-

8

0474 AWI-BAM, 2014 WL 584393, at *3-4 (E.D. Cal. 2014).

9

district court may not find a defendant has met the preponderance

Rodriguez v. AT

“[A]

10

of the evidence standard based on defendant's mere speculation

11

and conjecture.

12

2:13-CV-01648-KJM, 2014 WL 791546, at *7 (E.D. Cal. 2014) (citing

13

Garibay v. Archstone Communities LLC, 539 F. App'x 763, 764 (9th

14

Cir. 2013)).

15

Calloway v. Affiliated Computer Servs., Inc.,

To determine whether Defendants have met their burden here,

16

the Court must review “the reliability of the variables

17

[D]efendants use to calculate the amount in controversy as

18

exceeding $5 million.”

19

removal statutes against removal jurisdiction; federal

20

jurisdiction “‘must be rejected if there is any doubt as to the

21

right of removal in the first instance.’”

22

799 F. Supp. 2d 1107, 1115 (C.D. Cal. 2010) (quoting Gaus v.

23

Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992)).

24
25

2.

Id.

The Ninth Circuit strictly construes

Roth v. Comerica Bank,

Notice of Removal Damages Calculation

In their Notice of Removal, Defendants’ primary damage

26

calculation is based on Plaintiff’s § 226 claim.

27

contended that based on Woloshin-Williams’ calculation of 3,666

28

employees belonging to the class, this claim alone would amount
5

Defendants

1

to $14,664,000.

2

member of the class would be entitled to the maximum statutory

3

penalty of $4000.

4

This figure assumes however that every single

§ 226(e)(1).

The Ninth Circuit dealt with similar supporting evidence for

5

removal in Garibay.

539 F. App'x at 764.

There the court

6

observed that the only support for the defendants’ calculation of

7

the amount in controversy was “a declaration by their supervisor

8

of payroll, which set[] forth only the number of employees during

9

the relevant period, the number of pay periods, and general

10

information about hourly employee wages.”

11

the district court properly concluded the evidence “was

12

insufficient to support removal jurisdiction under CAFA,”

13

reasoning that beyond the declaration, “the defendants rely on

14

speculative and self-serving assumptions about key unknown

15

variables.”

16

of Removal is equally insufficient to support removal in the

17

instant case.

18
19

3.

Id.

Id.

The court found

The evidence submitted in support of the Notice

Defendants’ Opposition to Remand Motion

In their Opposition and the supplemental declaration from

20

Woloshin-Williams (Doc. #6-4), Defendants provide further

21

explanation of their calculations to support their claim that the

22

amount in controversy meets the jurisdictional minimum for

23

removal.

24

examined records for the period from November 27, 2009 through

25

March 1, 2014, and that she determined Barnes & Noble had 2,804

26

current and 7,666 former non-exempt California employees,

27

totaling 10,470.

28

wage for the class members was $8 per hour, the average amount of

Opp. at pp. 5-11.

Woloshin-Williams states that she

She further asserts that the lowest starting

6

1

overtime paid to all California hourly employees during the

2

period was 1.35 hours and Plaintiff worked an average of 1.06

3

overtime hours in the 100 weeks from November 27, 2009 to

4

present.

5

of “100 weeks” as there has been well over 100 weeks from

6

November 27, 2009 to the present.)

7

describes certain payment procedures used by Defendants.

(Defendants have provided no explanation for their use

8
9

a.

The declaration also

Waiting Time Penalties

Defendants contend the putative waiting time penalties under

10

§ 203 alone amount to over $14 million.

11

203 provides for a maximum of thirty days of wages for an

12

employee not properly paid.

13

contend that because Plaintiff has alleged the class members have

14

not been properly paid the full thirty days may be used for “each

15

of the putative class members.”

16

similarly assumed that each employee would be entitled to the

17

maximum statutory penalty.

18

rejected the assertion because it was not supported by any

19

evidence.

20

for their assumption of a maximum penalty.

21

in this district have accepted tenuous assumptions in the past,

22

“the Ninth Circuit and Courts in this district have recently

23

rejected Defendants' assumption of the maximum wage penalty (30

24

days) for waiting time violations as unsupported by the proper

25

evidence.”

26

539 F. App'x at 764; Weston v. Helmerich & Payne Inter. Drilling

27

Co., 1:13-CV-01092-LJO, 2013 WL 5274283, at *3-6 (E.D. Cal.

28

2013).

Id.

Opp. at p. 9.

Section

In their calculation, Defendants

The defendants in Garibay

539 F. App'x at 764.

The court

The Defendants here also fail to provide support
Although some courts

Emmons, 2014 WL 584393, at *7-8; see also Garibay,

7

1
2

b.

Meal and Rest Break/Minimum Wage Damages

Defendants offer similar contentions regarding Plaintiff’s

3

meal and rest break and minimum wage claims.

However, Defendants

4

again “rely on speculative and self-serving assumptions about key

5

unknown variables.”

6

in their meal and rest break putative damages calculations,

7

Defendants rely on each class member missing fifteen meal breaks

8

per year and suffering three violations of the minimum wage laws

9

per year.

Garibay, 539 F. App'x at 764.

Opp. at p. 10.

For example,

However, Defendants fail to provide

10

any substantive evidence in support of their assumptions

11

including why fifteen meal breaks or three minimum wage

12

violations should be presumed.

13
14

c.

Overtime Claim Damages

With respect to Plaintiff’s overtime claim, Defendants rely

15

on Ms. Woloshin-Williams’ declaration that: “Plaintiff . . .

16

worked an average of 1.06 hours of overtime in the 100 weeks from

17

November 27, 2009 to present.

18

paid to all California hourly employees during the claim period

19

is 1.35 hours.”

20

opposition, Defendants contend they have calculated the “overtime

21

pay in controversy based on 106 hours of overtime per putative

22

class member (based on the average of 1.06 hours of overtime

23

Plaintiff worked in the 100 weeks of the statutory period).”

24

at p. 14.

25

The average amount of overtime

Woloshin Williams’ Decl. ¶ 8.

In their

Opp

As pointed out by Plaintiff, Defendants’ use of 100 weeks is

26

confusing given that neither her employment nor the relevant

27

statutory period was 100 weeks.

28

basis for using the number of overtime hours paid by Defendants

In addition, there is no logical

8

1

to calculate the amount of unpaid overtime in controversy here.

2

As such, Defendants have failed to provide sufficient evidence to

3

meet the preponderance standard for their overtime claim damages.

4

d.

5

Attorneys’ Fees

Finally, Defendants contend the Court should consider the

6

likely attorneys’ fees in determining the amount in controversy.

7

Opp. at pp. 10-11.

8

to establish the amount in controversy upon which attorneys’ fees

9

would be based “is at least $4 million,” (Opp. at p. 11),

However, since there is insufficient evidence

10

Plaintiff’s contention is unpersuasive.

11

Corp., 150 F.3d 1011, 1029 (9th Cir. 1998) (Twenty-five percent

12

recovery is the “benchmark” level for reasonable attorney's fees

13

in class action cases).

14

e.

15

See Hanlon v. Chrysler

Garibay and Marentes

Defendants attempt to distinguish Garibay by pointing out

16

that the declarations describe the methodology used, use a

17

minimum wage rather than an average wage, and provide “actual

18

evidence of Plaintiff’s own overtime based on her employment

19

records.”

20

evidence standard to California Labor Code claims, many

21

California district courts have refused to credit damage

22

calculations based on variables not clearly suggested by the

23

complaint or supported by evidence, concluding that the

24

calculations are mere conjecture.”

25

1127.

26

at their figures for the amount in controversy, the Court finds

27

that the amounts are simply not supported by the evidence before

28

the Court.

Opp. at p. 8. “When applying the preponderance of the

Roth, 799 F. Supp. 2d at

Despite Defendants’ attempts to explain how they arrived

Therefore, based on the principles established in
9

1

Garibay, the Court refuses to rely on Defendants’ damages

2

calculations here.

3

Defendants’ arguments herein depend, in part, on an isolated

4

section of Marentes v. Key Energy Servs. California, Inc., 1:13-

5

CV-02067-LJO JLT, 2014 WL 814652, at *8-9 (E.D. Cal. 2014).

6

Specifically, Defendants point to the court’s statement that the

7

question in cases such as these is not what will ultimately be

8

proven in the course of the litigation but whether the damages

9

relied on by the removing party have been placed at issue by the

10

plaintiff's complaint.

11

defendant’s use of the 30-day maximum waiting time penalty for

12

all class members was proper.

13

that a removing defendant must set forth the underlying facts

14

supporting its figures, the court relied on the defendant’s

15

assessment of plaintiff’s complaint to accept its calculations.

16

The Marentes court cited to the allegations in the complaint

17

where the plaintiff claimed the defendant “failed to pay the

18

employees ‘their wages, earned and unpaid, within seventy-two

19

(72) hours’ of the end of their employment.”

Id.

The Marentes Court found the

After restating the requirement

Id.

20

Defendants rely on a similar allegation in the Complaint

21

where Plaintiff alleges Defendants “failed to pay the other class

22

members who are no longer employed by Defendants their wages,

23

earned and unpaid, within seventy-two (72) hours of their leaving

24

Defendants’ employ.”

25

Marentes, that the Court can assume each and every class member

26

is owed the maximum statutory amount.

27

Marentes court found such allegations sufficient to support the

28

assumption that maximum penalties are warranted in such a

Comp. ¶ 83.

10

Defendants contend, based on

However, although the

1

situation, this is in direct conflict with other court’s

2

findings.

3

2010 WL 3069333, at *2-3 (N.D. Cal. 2010), the court dealt with a

4

nearly identical situation.

5

defendant’s use of maximum penalties for all class members:

In Ruby v. State Farm Gen. Ins. Co., C 10-02252 SI,

However, the Ruby court rejected the

6

Had plaintiff's allegation been that the terminated

7

employees were never paid, or that they were all paid

8

at least thirty days late, then defendant's estimate

9

might be supportable. However, the allegation in the

10

complaint is simply that defendant “failed to pay

11

Plaintiff and class members who are no longer employed

12

by Defendants their wages . . . within seventy-two (72)

13

hours of their leaving Defendants' employ.”

14

Reading this allegation on its face, there may well be

15

some class members who would only be entitled to

16

recover penalties for a single day, or in event for

17

less than the thirty-day maximum.

18

nothing indicating that the penalties should be

19

assessed for the full thirty days for every employee

20

who may assert this claim, and its attempt to inflate

21

the amount in controversy by calculating the maximum

22

penalty for every terminated employee is improper.

FAC ¶ 70.

Defendant points to

23

Ruby, at *2-3; see also Pereira v. Gate Gourmet, Inc., No. 08–

24

07469 MMM(PJWX), 2009 WL 1212802, at *2–3 (C.D. Cal. 2009).

25

This Court finds the Ruby court’s reasoning to be more in

26

line with the principles established by the Ninth Circuit and is

27

not persuaded by Defendants’ Marentes’ argument.

28

//
11

1
2

f.

Conclusion

Defendants have failed to provide a reasonable calculation

3

of the amount in controversy that is based on competent evidence.

4

The estimated damage calculations provided by Defendants are

5

unsupported by the Complaint or Woloshin-Williams’s declarations

6

and are thus speculative and self-serving.

7

no basis at this time for the Court to find that removal is

8

warranted.

9

Remand.

10

Accordingly, there is

Accordingly, the Court grants Plaintiff’s Motion to

As the matter is now remanded back to the Sacramento County

11

Superior Court, Plaintiff’s Motion to Strike is more

12

appropriately addressed by that court.

13

WITHOUT PREJUDICE here.

Accordingly, it is DENIED

14
15
16

III.

ORDER

For the reasons set forth above, the Court GRANTS the

17

Plaintiff’s Motion to Remand.

18

the Sacramento County Superior Court, Plaintiff’s Motion to

19

Strike portions of Defendants’ answer is DENIED WITHOUT

20

PREJUDICE.

21
22

As the case is remanded back to

IT IS SO ORDERED.
Dated: May 30, 2014

23
24
25
26
27
28
12