Bryan et al v. Wal-Mart Stores Inc. et al

Filing 82

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT'S MOTION TO DISMISS 74 (Illston, Susan) (Filed on 6/26/2013)

1
2
3
4
5
IN THE UNITED STATES DISTRICT COURT
6
FOR THE NORTHERN DISTRICT OF CALIFORNIA

7
8
9
United States District Court
For the Northern District of California

12
13

ORDER GRANTING IN PART AND
DENYING IN PART DEFENDANT’S
MOTION TO DISMISS

Plaintiffs,

10
11

No. C 08-05221 SI

DONALD BRYAN, et al.,

v.
WAL-MART STORES, INC., et al.,
Defendants.

/

14
15

Currently before the Court is defendant Wal-Mart’s motion to dismiss plaintiffs’ fourth amended

16

complaint. Pursuant to Civil Local Rule 7-1(b), the Court finds this matter suitable for disposition

17

without oral argument and therefore VACATES the hearing currently scheduled for June 28, 2013.

18

Having carefully considered the papers submitted, the Court GRANTS in part and DENIES in part

19

defendant’s motion to dismiss, for the reasons set forth below.

20
21

BACKGROUND

22

Plaintiffs are truck drivers (“Drivers”) in California previously employed by defendant Wal-Mart

23

for some period of time between 1993 and the present, who allege they were neither paid all earned

24

wages nor were they paid timely. Fourth Am. Compl. (“4AC”) 3-6. Plaintiffs allege Wal-Mart violated

25

a number of California laws by failing to pay plaintiffs’ timely wages or provide meal and rest breaks,

26

requiring that employees work “off-the-clock,” and failing to provide accurate wage statements.

27

Plaintiffs assert the following causes of action: (1) failure to provide meal breaks; (2) failure to provide

28

rest breaks; (3) failure to timely pay wages due; (4) violation of California’s Unfair Competition Law

1

(Cal. Bus. & Profs. Code § 17200); (6) failure to provide an accurate wage statement; and (7) failure

2

to pay minimum wage. Plaintiffs no longer assert their fifth cause of action.
In the Court’s April 18, 2013 Order, plaintiffs’ first and second causes of actions were dismissed

4

for failure to state a valid claim for violations of California’s meal and rest break provisions. See

5

Docket No. 72 (“Order”) at 7. The claims were insufficient because plaintiffs failed to describe any

6

facts about how Wal-Mart “‘pressured, incentivized or discouraged’” the Drivers from taking breaks.

7

Id. (quoting Third Am. Compl. (“TAC”) ¶ 49). The third, fourth, and fifth causes of action were

8

dismissed in part as derivative to the meal and rest break claims, and in part as insufficient. Id. at 8-12.

9

The sixth cause of action was dismissed for insufficiency. Id. at 12. The seventh cause of action, for

10
United States District Court
For the Northern District of California

3

minimum wage violations, was the only claim that survived defendant’s motion to dismiss the third

11

amended complaint. Id. at 10. Subsequently, plaintiffs filed a fourth amended complaint, seeking to

12

address the deficiencies identified by the Court. Wal-Mart moves to dismiss the new complaint.

13
14

LEGAL STANDARD

15

Under Federal Rule of Civil Procedure 12(b)(6), a district court must dismiss a complaint if it

16

fails to state a claim upon which relief can be granted. To survive a Rule 12(b)(6) motion to dismiss,

17

the plaintiff must allege “enough facts to state a claim to relief that is plausible on its face.” Bell Atl.

18

Corp. v. Twombly, 550 U.S. 544, 570 (2007). This “facial plausibility” standard requires plaintiffs to

19

allege facts that amount to “more than a sheer possibility that a defendant has acted unlawfully.”

20

Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). While courts do not require “heightened fact pleading of

21

specifics,” a plaintiff must provide “more than labels and conclusions, and a formulaic recitation of the

22

elements of a cause of action will not do.” Twombly, 550 U.S. at 544-55.

23

In deciding whether the plaintiff has stated a claim upon which relief can be granted, the Court

24

must assume the plaintiffs’ allegations are true and must draw all reasonable inferences in the plaintiffs’

25

favor. See Usher v. City of Los Angeles, 828 F.2d 556, 561 (9th Cir. 1987). However, the Court is not

26

required to accept as true “allegations that are merely conclusory, unwarranted deductions of fact, or

27

unreasonable inferences.” St. Clare v. Gilead Scis., Inc. (In re Gilead Scis. Sec. Litig.), 536 F.3d 1049,

28

1055 (9th Cir. 2008). The Ninth Circuit has distilled the following principles from Iqbal and Twombly:
2

1

First, to be entitled to the presumption of truth, allegations in a complaint or counterclaim may not simply recite the elements of a cause of action, but must contain sufficient
allegations of underlying facts to give fair notice and to enable the opposing party to
defend itself effectively. Second, the factual allegations that are taken as true must
plausibly suggest an entitlement to relief, such that it is not unfair to require the opposing
party to be subjected to the expense of discovery and continued litigation.

2
3
4

Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011).
5
If the Court dismisses a complaint, it must decide whether to grant leave to amend. The Ninth
6
Circuit has “repeatedly held that a district court should grant leave to amend even if no request to amend
7
the pleading was made, unless it determines that the pleading could not possibly be cured by the
8
allegation of other facts.” Lopez v. Smith, 203 F.3d 1122, 1130 (9th Cir. 2000) (citations and internal
9
quotation marks omitted).
United States District Court
For the Northern District of California

10
11
DISCUSSION
12
I.

Claims Relating to Meal and Rest Break Violations (1st and 2nd Causes of Action)

13
A.

Adequacy of the Pleadings

14
Plaintiffs’ first and second causes of action are based on alleged violations of California Labor
15
Code sections 226.7 and 512. The laws provide that an employer may not require an employee to work
16
during meal or rest periods without providing an additional hour of pay, and further, that no employee
17
can be required to work over five hours without a meal/rest period of at least thirty minutes. Cal. Lab.
18
Code §§ 226.7, 512 (2001).
19
Plaintiffs, in their fourth amended complaint, include new facts describing how Wal-Mart
20
“incentivized, pressured and discouraged” the Drivers from taking breaks. Plaintiffs allege that Wal21
Mart pressured employees to avoid breaks by limiting the time per day that they could drive, yet
22
granting commendations/bonuses for miles driven and efficiency. 4AC ¶ 49. Plaintiffs also allege that
23
Wal-Mart discouraged the Drivers from taking breaks because they did not pay their employees for time
24
spent washing their trucks, waiting to get dispatched, or waiting at stores. Id. Plaintiffs claim all these
25
facts led to a reasonable and foreseeable pressure on Drivers to forego their meal or rest breaks.
26
As a pleading matter, the Court finds that these facts are sufficient to “raise a right to relief above
27
the speculative level,” and to “permit the court to infer more than the mere possibility of misconduct.”
28
3

1
B.

3

Second, Wal-Mart argues that the first and second causes of action should be dismissed because

4

of federal preemption. The Court has already heard and decided the issue of whether the Federal

5

Aviation Administration Authorization Act of 1994 (“FAAA”) preempts California meal and rest break

6

laws. Order 3-6. The Court held that California’s meal and rest break laws do not “relate to” motor

7

carriers’ rates, routes or services and are not preempted by the FAAA Act. Id. at 6. Wal-Mart now

8

contends the Court was incorrect in its conclusion that California meal and rest break laws are flexible

9

enough to avoid binding motor carriers to a particular route or service. Def.’s Mot. 13. Because the

10
United States District Court
For the Northern District of California

2

Federal Preemption

Court has already decided this issue, it would first have to grant a motion to reconsider in order to again

11

address the federal preemption question.

12

“Reconsideration is appropriate if the district court (1) is presented with newly discovered

13

evidence, (2) committed clear error or the initial decision was manifestly unjust, or (3) if there is an

14

intervening change in controlling law.” School Dist. No. 1J v. ACandS, Inc., 5 F.3d 1255, 1263 (9th Cir.

15

1993). Reconsideration should be used conservatively, because it is an “extraordinary remedy, to be

16

used sparingly in the interests of finality and conservation of judicial resources.” Carroll v. Nakatani,

17

342 F.3d 934, 945 (9th Cir. 2003). A motion for reconsideration may not be used to present arguments

18

that were presented initially or “reasonably could have been raised” during the initial motion. Id. The

19

district court has discretion to deny a motion for reconsideration. Kona Enterprises, Inc. v. Estate of

20

Bishop, 229 F.3d 877, 883 (9th Cir. 2000). Further, in the Northern District of California, any party

21

seeking to file a Motion for Reconsideration may only do so after obtaining leave from the Court. See

22

Civil Local Rule 7-9(a).

23

According to Wal-Mart, the Mendez v. R+L Carriers Inc., No. C 11–2478, 2012 WL 5868973

24

(N.D. Cal. Nov. 19, 2012), decision, which the Court relied on in its Order, is incorrect because it

25

presumes a flexibility that the California break and meal laws do not actually afford. Def’s Mot. 13.

26

Although Wal-Mart’s contentions are emphatic, they are not novel, and the Court has already rejected

27

these same arguments. The Court held that the California laws are not preempted, and Wal-Mart has

28

presented no new law or evidence to contradict this holding. Furthermore, Wal-Mart did not obtain
4

1

leave from the Court for reconsideration. Thus, the Court does not find there is sufficient basis for it

2

to reconsider its holding that plaintiffs’ claims are not preempted by the FAAA.

3
4

Accordingly, the Court DENIES Wal-Mart’s motion to dismiss plaintiffs’ first and second causes
of action.

5
6

II.

Unpaid Wages (3rd Cause of Action)
Plaintiffs’ third cause of action alleging violations of California Labor Code §§ 201-203 is based

8

on plaintiffs’ meal and rest break allegations. 4AC ¶¶ 61-68. The Court previously dismissed the claim

9

because it was derivative of the first two causes of action, which it found were insufficiently pled. Order

10
United States District Court
For the Northern District of California

7

8. Because the Court has found that plaintiffs’ fourth amended complaint has sufficiently provided facts

11

to support their allegation that Wal-Mart failed to pay earned wages, the Court also finds that this

12

derivative claim is sufficiently pled. Accordingly, the Court DENIES defendant’s motion to dismiss

13

the third cause of action.

14
15

III.

Wage Statement Claims (6th Cause of Action)

16

The Court previously dismissed plaintiffs’ sixth cause of action for failing to allege an essential

17

element required to sustain a violation of California Labor Code § 226. Order 11. Section 226(e)(1)

18

requires injury “as a result of a knowing and intentional failure by an employer to comply with

19

subdivision (a),” which requires employers to provide accurate, itemized wage statements. Cal. Lab.

20

Code § 226(a), (e)(1). In their third amended complaint, plaintiffs presented only conclusory allegations

21

that Wal-Mart “knowingly and intentionally” violated the law, but did not provide factual support.

22

Plaintiffs now add the facts that Wal-Mart had all documents necessary to provide check stubs

23

with a breakdown of the piece-rate pay earned, as required by section 226(a), yet did not provide this

24

information on employees’ wage statements. 4AC ¶ 84. Plaintiffs allege that documents stating the

25

total number of hours worked and all the activities performed by the Drivers enabled Wal-Mart to

26

determine the information required by the Labor Code, yet Wal-Mart still chose to provide only a gross

27

statement for “regular earning.” Id. Plaintiffs allege that this failure to break down the piece rate system

28
5

1

in their wage statements was done on a systematic basis, and was thus a knowing and intentional failure

2

to comply with the Labor Code. Id.

3

This information provides factual support to the allegations that Wal-Mart failed to provide

4

accurate wage statements as required by the Labor Code. See Cal. Lab. Code § 226(e)(1). Plaintiffs

5

therefore provide sufficient facts to support a valid section 226 violation claim, and the Court DENIES

6

defendant’s motion to dismiss the sixth amended complaint.

7
8

IV.

Minimum Wage Claims (7th Cause of Action)
The Court previously denied Wal-Mart’s motion to dismiss plaintiffs’ minimum wage claims.

10
United States District Court
For the Northern District of California

9

Order 11. It found plaintiffs’ factual allegations that the Drivers were not being paid for activities such

11

as “time required to drop their trailer for fueling . . . time spent moving trailers . . . [and] time spent

12

clearing a dock to drop a trailer,” were sufficient to state a valid claim for violation of California’s

13

minimum wage laws. Id.

14

Wal-Mart now argues the minimum wage claims should be dismissed as a matter of law because

15

plaintiffs have not adequately alleged that any Driver worked off the clock. Def.’s Mot. 18-19.

16

However, this Court has already held that the plaintiffs’ allegations are sufficient, and Wal-Mart has

17

presented no new law or facts that would justify reconsideration of its previous holding. See supra,

18

section I.B (discussing the requirements for a motion for reconsideration).

19
20

Accordingly, the Court DENIES defendant’s motion to dismiss plaintiffs’ seventh cause of
action.

21
22

V.

California’s Unfair Competition Law Violations (4th Cause of Action)

23

California’s Unfair Competition Law (“UCL”), California Business and Professions Code §§

24

17200 et seq., has a broad scope that allows for “violations of other laws to be treated as unfair

25

competition that is independently actionable” while also “sweep[ing] within its scope acts and practices

26

not specifically proscribed by any other law.” Kasky v. Nike, Inc., 27 Cal.4th 939, 949 (2002). Here,

27

plaintiffs’ fourth cause of action alleges that Wal-Mart violated the UCL by failing to pay plaintiffs

28

minimum wage, preventing plaintiffs from taking rest and meal breaks, failing to comply with Labor
6

1

Code section 226, and misrepresenting their statutory duty to provide meal periods. 4AC ¶ 69. Thus,

2

its UCL claim is derivative of plaintiffs’ other causes of action.

3
4

Because the Court finds that plaintiffs have sufficiently pled a claim for those causes of action,
plaintiffs’ UCL cause of action similarly sufficiently states a claim.

5

Accordingly, the Court DENIES defendant’s motion to dismiss plaintiffs’ fourth cause of action.

6
7

VI.

Punitive Damages
The Court has previously ordered that all portions of the complaint requesting punitive damages

9

be stricken. Plaintiffs have withdrawn all of their punitive damages requests, but have neglected to

10
United States District Court
For the Northern District of California

8

withdraw the request from paragraph three of the Prayer. 4AC Prayer, ¶ 3. Plaintiffs concede that this

11

request should also be stricken. Pls.’ Opp’n 23.

12
13

Accordingly, the Court GRANTS defendant’s motion to strike the portions of the Prayer that
seek punitive damages.

14
15

CONCLUSION

16

For the foregoing reasons, the Court DENIES defendant’s motion to dismiss plaintiffs’ 1st, 2nd,

17

3rd, 4th, 6th, and 7th causes of action, and GRANTS defendant’s motion to strike the Prayer’s request

18

for punitive damages. This resolves Docket No. 74.

19
20

IT IS SO ORDERED.

21
22

SUSAN ILLSTON
United States District Judge

Dated: June 26, 2013

23
24
25
26
27
28
7