Greer v. Dick's Sporting Goods, Inc.

Filing 64

ORDER signed by District Judge Kimberly J. Mueller on 1/9/2018 DENYING without prejudice 54 Motion to Stay. (York, M)

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 12 JIMMY GREER, individually, and on behalf of others similarly situated, Plaintiff, 13 16 ORDER v. 14 15 No. 2:15-cv-01063-KJM-CKD DICK’S SPORTING GOODS, INC., a Delaware corporation; and DOES 1 through 100, inclusive, Defendants. 17 18 19 Defendant Dick’s Sporting Goods, Inc.’s motion to stay this certified class action, 20 pending the California Supreme Court’s answers to two questions certified by the Ninth Circuit, 21 is before the court.1 For reasons explained below, defendant’s motion is DENIED without 22 prejudice. 23 ///// 24 1 25 26 27 28 On November 27, 2017, defendant filed a notice of plaintiff’s failure to timely respond to defendant’s motion to stay and requested the court consider the motion as unopposed. ECF No. 57. That day, plaintiff filed his opposition, ECF No. 58, and filed a declaration explaining the reasons for his untimely filing, ECF No. 59-1. Defendant subsequently responded to plaintiff’s opposition on the merits without addressing the timeliness of the filing. ECF No. 61. Preferring to reach the merits and construing defendant’s reply as an effective withdrawal of any objection to the timeliness issue, the court declines to consider the motion as unopposed. 1 1 I. BACKGROUND 2 The court previously addressed the factual and procedural background of this case 3 in detail in its order granting plaintiff’s motion for class certification. Class Cert. Order, ECF No. 4 45 (April 13, 2017). The court provides a brief summary here. 5 Plaintiff Jimmy Greer (“plaintiff”) filed a class action complaint on March 19, 6 2015, in the Superior Court of the State of California for the County of Sacramento, alleging 7 defendant Dick’s Sporting Goods, Inc. (“defendant” or “DSG”) violated several provisions of the 8 California Labor Code and California Business and Professions Code § 17200, et seq. Compl., 9 ECF No. 1-1. DSG removed the action to this court on May 15, 2015. Removal Not., ECF 10 No. 1. On October 1, 2015, plaintiff filed the operative first amended complaint. First Am. 11 Comp. (“FAC”), ECF No. 14. On April 13, 2017, the court granted plaintiff’s motion to certify 12 two subclasses: (1) a “Security Check Class” arising from plaintiff’s claim that DSG employees 13 were required to wait, while off the clock, for inspection of their personal belongings before 14 exiting the store, and (2) a “Business Reimbursement Class,” arising from plaintiff’s claim that 15 DSG employees were required to purchase apparel but were not reimbursed for their purchases. 16 Class Cert. Order at 1-4. 17 DSG now seeks to stay this action pending the California Supreme Court’s 18 decisions in two cases. In the first case, Troester v. Starbucks Corp., Case No. S234969 19 (“Troester”), the state Court agreed to decide the following question certified to it by the Ninth 20 Circuit: 21 Does the federal Fair Labor Standards Act’s de minimis doctrine, as stated in Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 692, 66 S. Ct. 1187, 90 L. Ed. 1515 (1946) and Lindow v. United States, 738 F.2d 1057, 1063 (9th Cir. 1984), apply to claims for unpaid wages under the California Labor Code sections 510, 1194, and 1197? 22 23 24 25 Troester v. Starbucks Corp., 680 F. App’x 511, 512 (9th Cir. 2016). This court, in its 26 certification order, noted the law is unclear as to whether the federal de minimis doctrine applies 27 to California labor cases, and cited the question certified in Troester. The court found that even if 28 ///// 2 1 the doctrine applies, there would be common questions regarding whether the class satisfied the 2 doctrine’s requirements. Class Cert. Order at 12-13. 3 4 In the second case, Frlekin v. Apple, Case No. S243805 (“Frlekin”), the state Court agreed to decide the Ninth Circuit’s certified question: 5 Is time spent on the employer’s premises waiting for, and undergoing, required exit searches of packages or bags voluntarily brought to work purely for personal convenience by employees compensable as “hours worked” within the meaning of California Industrial Welfare Commission Wage Order No. 7? 6 7 8 Frlekin v. Apple, Inc., 870 F.3d 867, 869 (9th Cir. 2017). 9 DSG argues the decisions to be rendered in Troester and Frlekin will be 10 “potentially dispositive” with respect to plaintiff’s Security Check Class claims, and thus urges 11 the court to stay this action until those cases are decided. Stay Mem., ECF No. 54-1 at 5.2 12 Plaintiff opposes. Stay Opp’n, ECF No. 58. DSG filed a reply. Stay Reply, ECF No. 61. The 13 court submitted the motion without hearing and resolves it here. See Dec. 1, 2017 Min. Order, 14 ECF No. 62. 15 II. 16 LEGAL STANDARD “A district court has inherent power to control the disposition of the causes on its 17 docket in a manner to promote economy of time and effort for itself, for counsel, and for 18 litigants.” CMAX, Inc. v. Hall, 300 F.2d 265, 268 (9th Cir. 1962). “A trial court may, with 19 propriety, find it is efficient for its own docket and the fairest course for the parties to enter a stay 20 of an action before it, pending resolution of independent proceedings that bear upon the case.” 21 Leyva v. Certified Grocers of Cal., Ltd., 593 F.2d 857, 863 (9th Cir. 1979). The court’s inherent 22 power is discretionary. CMAX, 300 F.2d at 268 (9th Cir. 1962). 23 In determining whether a stay is warranted, the court must weigh the competing 24 interests resulting from granting or declining a motion to stay. Id. Among the competing 25 interests are (1) the possible damage that may result from granting a stay, (2) the hardship or 26 inequity a party may suffer in being required to go forward, and (3) the orderly course of justice 27 28 2 All citations to the parties’ briefs refer to ECF page numbers, not the briefs’ internal pagination. 3 1 measured in terms of the simplifying or complicating of issues, proof, and questions of law 2 expected to result from a stay. Id. (citing Landis v. N. Am. Co., 299 U.S. 248, 254-255 (1936)). 3 “[I]f there is even a fair possibility that the stay for which he prays will work damage to some one 4 else,” the moving party “must make out a clear case of hardship or inequity in being required to 5 go forward.” Landis, 299 U.S. at 255 (verbatim quote). Furthermore, “a stay should not be 6 granted unless it appears likely the other proceedings will be concluded within a reasonable 7 time.” Leyva, 593 F.2d at 864; see Dependable Highway Exp., Inc. v. Navigators Ins. Co., 498 8 F.3d 1059, 1066 (9th Cir. 2007). “The proponent of a stay bears the burden of establishing its 9 need.” Clinton v. Jones, 520 U.S. 681, 708 (1997) (citing Landis, 299 U.S. at 255). The court 10 weighs the competing interests in this case below. 11 III. 12 ANALYSIS A. Possible Damage 13 There is “a fair possibility that the stay . . . will work damage to [plaintiff and the 14 class]” in at least three significant ways. See Landis, 299 U.S. at 255; see also Lockyer v. Mirant 15 Corp., 398 F.3d 1098, 1112 (9th. Cir. 2005) (determining party faced a “‘fair possibility’ of harm 16 . . . .”). First, plaintiff notes that Troester and Frlekin are of no import to plaintiff’s Business 17 Reimbursement Class claims, yet DSG seeks to stay those claims as well as the Security Check 18 Class claims. Stay Opp’n at 4-5. DSG acknowledges the Business Reimbursement Class claims 19 will not be affected by the California Supreme Court’s decisions. Stay Reply at 13 n.7. 20 Nonetheless, rather than seeking to stay only the Security subclass claims, DSG seeks to stay the 21 entire action, arguing a partial stay “would likely cause the very hardship the stay was intended to 22 avoid.” Id. Because staying the Business Reimbursement Class claims would not serve the 23 purpose of awaiting “resolution of independent proceedings that bear upon the case,” see Leyva, 24 593 F.2d at 863–64, delaying adjudication of those claims presents a fair possibility of harm. 25 Second, as to the Security subclass claims, plaintiff argues and DSG concedes that 26 the parties necessarily will conduct “discovery on the amounts of times [class members] spent on 27 security checks” even if the Troester Court determines the de minimis doctrine does not apply to 28 California Labor Code claims. Stay Opp’n at 6; Stay Reply at 10. Because such discovery is 4 1 necessary regardless of the outcome in Troester, plaintiff argues “the longer this case is stayed, 2 the harder evidence becomes to collect as witnesses’ memories fade and documents disappear or 3 get destroyed.” Stay Opp’n at 7. DSG contends that plaintiff overstates the risk of harm 4 presented by a stay because “significant discovery has already taken place in this matter, both 5 parties will remain under an obligation to preserve relevant evidence, and Plaintiff has been in 6 possession of the contact information of more than 2,000 class members for years.” Stay Mot. at 7 9-10; Stay Reply at 12. Plaintiff’s concern class members’ memories may fade is well taken, 8 particularly in light of the open-ended nature of DSG’s proposed stay and the need for discovery 9 that “depend[s] on the memories of class member[s] . . . as to lengths of time spent undergoing 10 security checks.” See Stay Opp’n at 7; see also Mendez v. Optio Sols., LLC, 239 F. Supp. 3d 11 1229, 1235 (S.D. Cal. 2017) (finding “the potential of prejudice to Plaintiff in delaying discovery 12 is likely and severe”). 13 Third, there is no assurance Troester and Frlekin will be decided in the near, or 14 reasonably near, future. Nor has DSG suggested a specific timeframe for its requested stay. See, 15 e.g., Robledo v. Randstad US, L.P., No. 17-CV-01003-BLF, 2017 WL 4934205, at *3 (N.D. Cal. 16 Nov. 1, 2017) (granting motion to stay because case pending before U.S. Supreme Court was 17 fully briefed and argued and stay would therefore “likely last no more than a few months while 18 the Supreme Court writes its opinion . . . .”). The California Supreme Court schedules oral 19 argument “[a]fter the justices conclude that they have had sufficient time to consider the matter 20 and that it is ready to be heard,” which “typically occurs several months to a year after all briefs 21 on the merits have been filed.” See Supreme Court Practices & Procedures, The Judicial Branch 22 of California (online resource last reviewed Jan. 8, 2018).3 The Court then files its written 23 opinion within 90 days of oral argument. Id.; see Lincoln Gen. Ins. Co. v. Ryan Mercaldo LLP, 24 No. 13-CV-2192 W (DHB), 2015 WL 12672145, at *4 (S.D. Cal. Sept. 14, 2015) (noting 25 informal review of cases filed since 2009 indicated the California Supreme Court took between 26 27 28 3 Unless a permanent electronic link is available, the court declines to adopt a citation convention requiring reference to a lengthy URL. Instead, the court describes the source with detail that it believes will be sufficient to permit independent location of the source. 5 1 nine to twenty-six months to answer certified questions). The California Supreme Court’s 2 website indicates Troester has been fully briefed, but oral argument has not been scheduled. See 3 Appellate Courts Case Information, The Judicial Branch of California, Troester v. Starbucks 4 Corp, S234969, Case Summary and Docket (online database last reviewed Jan. 8, 2018). 5 Furthermore, briefing in Frlekin has just begun, as the opening brief was filed on December 19, 6 2017 and respondent recently requested a 60-day extension to file an answer. See id., Frlekin v. 7 Apple, S243805, Case Summary and Docket (online database last reviewed Jan. 8, 2018). In 8 effect, therefore, DSG seeks an open-ended stay for upwards of two years to allow resolution of 9 the question in Frlekin. This too risks possible prejudice to class members whose day in court 10 11 12 would be placed on an indefinite hold. B. Hardship or Inequity Because there is a fair possibility class members would be harmed by a stay, the 13 court considers whether defendants have presented “a clear case of hardship or inequity in being 14 required to go forward.” See Landis, 299 U.S. at 255. When weighing the relevant interests, the 15 court is mindful that “[o]nly in rare circumstances will a litigant in one cause be compelled to step 16 aside while a litigant in another settles the rule of law that will define the rights of both.” Id. 17 DSG argues a stay is necessary to spare both parties the hardship of proceeding 18 with discovery and dispositive motions under uncertain legal standards, which “may well result in 19 the need to re-depose witnesses, revisit discovery responses, reconsider rulings on dispositive 20 motions, or pursue appeals that could have been avoided” should the California Supreme Court’s 21 decisions change the applicable law. Stay Mem. at 11. For example, if the Troester Court 22 determines that the de minimis doctrine does not apply to California labor law claims, DSG 23 argues the parties will have engaged in needless discovery on two out of three elements of that 24 doctrine: (1) the practical administrative difficulty of recording additional time spent in security 25 checks and (2) the regularity of the additional work. Stay Reply at 10 (acknowledging discovery 26 on amount of time class members spent undergoing security inspections will be necessary, 27 regardless of outcome in Troester); see Lindow v. United States, 738 F.2d 1057, 1063-64 (9th Cir. 28 1984) (reciting three elements of federal de minimis defense). Likewise, DSG argues the Frlekin 6 1 Court may determine that security inspections constitute “hours worked” regardless of whether 2 such inspections are voluntary, rendering irrelevant the parties’ anticipated discovery and motion 3 practice on the voluntariness issue. Stay Mem. at 12. 4 At this juncture, the court is not persuaded DSG has shown a clear case of 5 hardship that outweighs the risk of harm posed by a stay. Rather, it is well established that “being 6 required to defend a suit, without more, does not constitute a ‘clear case of hardship or inequity’ 7 within the meaning of Landis.” Lockyer, 398 F.3d at 1112. Thus, DSG’s anticipated defense 8 expenses do not necessarily tip the Landis balance in favor of a stay. See, e.g., Mendez, 9 239 F. Supp. 3d at 1234 (finding party requesting stay did “not demonstrate a hardship in moving 10 forward with inevitable discovery and motion practice”). Moreover, to the extent unnecessary 11 discovery and motion practice may pose a hardship to DSG, DSG has not met its burden in 12 articulating that hardship with sufficient particularity. 13 DSG provides no indication whatsoever of the expected magnitude or cost of 14 anticipated discovery on issues that may be narrowed or mooted by the California Supreme 15 Court’s decisions in Troester and Frlekin. Instead, DSG simply argues its discovery expenses 16 may be for naught and notes that “moving for summary judgment involves extensive depositions, 17 expert studies and reports, all at great cost to the parties . . . .” Stay Reply at 6. These broad 18 representations do not convince the court that DSG faces a clear risk of hardship. For example, 19 because DSG concedes it will inevitably conduct discovery on the time class members spent 20 undergoing security checks, see Stay Reply at 10, it is not obvious to the court that discovery on 21 the remaining de minimis factors is significant enough to warrant a stay. Furthermore, although 22 DSG argues “the next proceeding” in this matter will be DSG’s motion for summary judgment, 23 DSG provides no basis from which the court can infer such a motion is immediately forthcoming, 24 or even that it will be filed before the California Supreme Court issues its decisions in Troester 25 and Frlekin. See Stay Mem. at 11-12. The next proceeding showing on the court’s docket is 26 plaintiffs’ motion for approval of a class notice and plan, see ECF No. 55, and no dispositive 27 motion cutoff has yet been set. Moreover, if a motion for summary judgment were imminent, it is 28 unclear why a stay is necessary to prevent potentially unnecessary discovery. If DSG plans to file 7 1 a motion for summary judgment that turns on the de minimis doctrine or the voluntariness issue, 2 DSG may renew its motion to stay with more supporting detail than currently provided. 3 C. 4 Simplification of the Issues, Proof, and Questions of Law Finally, DSG argues a stay would simplify the issues, proof and questions of law 5 by renewing proceedings only after the California Supreme Court has determined the 6 applicability of the de minimis doctrine and the voluntariness issue. Id. at 12-13. 7 The court agrees that the California Supreme Court’s decisions may bear on the 8 Security Check Class claims and could potentially limit the scope of discovery and issues of law 9 to be adjudicated in this case. Accordingly, this factor weighs in favor of a stay but does not 10 outweigh the other factors for which DSG has failed to meet its burden. 11 III. 12 CONCLUSION DSG has not shown a stay is warranted here. See Clinton, 520 U.S. at 708. 13 Accordingly, the motion to stay is DENIED without prejudice. The parties should be prepared to 14 discuss future scheduling at the conclusion of the motion hearing on January 12, 2018, including 15 whether discovery and dispositive motion practice might be timed to achieve efficiencies in light 16 of Troester and Frlekin. 17 18 IT IS SO ORDERED. DATED: January 9, 2018. 19 20 UNITED STATES DISTRICT JUDGE 21 22 23 24 25 26 27 28 8

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