Juarez et al v. Jani-King of California, Inc. et al

Filing 181

ORDER by Judge Samuel Conti granting 176 Motion for Certificate of Appealability (sclc1, COURT STAFF) (Filed on 2/16/2012)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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ALEJANDRO JUAREZ, et al.,
Plaintiffs,

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For the Northern District of California

United States District Court

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v.
JANI-KING OF CALIFORNIA, INC., et
al.,
Defendants.

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Case No. 09-03495 SC
ORDER GRANTING PLAINTIFFS'
MOTION FOR CERTIFICATION
PURSUANT TO 28 U.S.C §
1292(b) AND STAYING FURTHER
PROCEEDINGS PENDING APPEAL

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Plaintiffs Alejandro Juarez, Maria Juarez, and Maria Portillo

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(collectively, "Plaintiffs") purchased cleaning service franchises

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from Defendant Jani-King of California, Inc., Jani-King, Inc., and

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Jani-King International, Inc. (collectively, "Defendants").

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cleaning service franchises turned out to be unprofitable, and

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Plaintiffs subsequently brought this action against Defendants.

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Among other things, Plaintiffs asserted claims under the California

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Labor Code, alleging that they were misclassified as franchisees

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because Defendants exercised such control over them so as to create

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an employer-employee relationship.

The

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On January 23, 2012, the Court dismissed Plaintiffs' Labor

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Code claims when it granted in part and denied in part Defendants'

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motion for summary judgment.

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Decision).

ECF No. 168 (Summary Judgment

The Court, relying on the California Court of Appeal's

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decision in Cislaw v. Southland Corporation, 4 Cal. App. 4th 1284

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(Cal. Ct. App. 1992), held that "[a] franchisee must show that the

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franchisor exercised 'control beyond that necessary to protect and

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maintain its interest in its trademark, trade name, and good will'

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to establish a prima facie case of an employer-employee

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relationship."

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Cal. App. 4th at 1296).

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that it should apply the test enunciated by the Ninth Circuit in

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Narayan v. EGL, Inc., 616 F.3d 895, 900 (9th Cir. 2010), reasoning

Summary Judgment Decision at 8 (quoting Cislaw, 4
The Court rejected Plaintiffs' argument

United States District Court

For the Northern District of California

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the Narayan test was inapposite in the franchise context.

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9 n.2.

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Id. at

Plaintiffs now move the Court to certify for interlocutory

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appeal that portion of the Court's Summary Judgment Decision

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dismissing Plaintiffs' Labor Code claims and to stay further

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proceedings pending that appeal.

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have filed an opposition and Plaintiffs have filed a reply.

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No. 179 ("Opp'n"), 180 ("Reply").

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1(b), the Court finds the Motion suitable for determination without

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oral argument.

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ECF No. 176 ("Mot.").

Defendants
ECF

Pursuant to Civil Local Rule 7-

A district court may certify for appellate review any order

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that, in the court's opinion, "[1] involves a controlling question

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of law [2] as to which there is substantial ground for difference

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of opinion and [3] [where] an immediate appeal from the order may

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materially advance the ultimate termination of the litigation."

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28 U.S.C. § 1292(b).

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to decide whether to grant a motion for certification.

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Title Ins. Antitrust Litig., No. 08-01341 JSW, 2010 U.S. Dist.

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LEXIS 28923, at *7 (N.D. Cal. Mar. 3, 2010).

District courts have substantial discretion

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In re Cal.

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The parties agree that the Court's Summary Judgment Decision

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regarding Plaintiffs' Labor Code claims involves a controlling

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question of law and that an immediate appeal may materially

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advance the ultimate termination of the litigation.

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2-3, Opp'n at 1.

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order for a question to be 'controlling' is that resolution of the

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issue on appeal could materially affect the outcome of the

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litigation in the district court."

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673 F.2d 1020, 1026 (9th Cir. 1982).

The Court concurs.

See Mot. at

"[A]ll that must be shown in

In re Cement Antitrust Litig.,
In the instant action, the

United States District Court

For the Northern District of California

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Court's decision to apply the Cislaw "right-to-control" analysis

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in the employment classification context is a controlling question

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of law because it could affect the outcome of the summary decision

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on Plaintiffs' Labor Code claims.

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from the Court's Summary Judgment Decision would "materially

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advance the ultimate termination of the litigation."

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Circuit reverses and holds that Plaintiffs' Labor Code claims

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raise triable issues of fact, the Court can hold a single trial to

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address all claims at once.

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Further, an immediate appeal

If the Ninth

The parties disagree about whether there is substantial ground

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for difference of opinion regarding the question of law at issue.

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Having reviewed the papers, the Court finds that there is

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substantial ground for difference of opinion regarding the

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application of Cislaw to Plaintiffs' Labor Code claims.

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Court acknowledged in its order denying class certification, the

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controlling authority on this issue "is not entirely clear."

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130 at 22-23.

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conclusions as to what test should apply to employment

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classification claims brought in the franchise context.

As the

ECF

Courts in other states have reached different

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See Hayes

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v. Enmon Enters., LLC, 10-CV-00382-CWR-LRA, 2011 U.S. Dist. LEXIS

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66736 (S.D. Miss. June 22, 2011); Awuah v. Coverall N. Am. Inc.,

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707 F. Supp. 2d 80 (D. Mass. 2010); Coverall N. Am., Inc. v.

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Division of Unemployment Assistance, 447 Mass. 852 (2006).

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Further, the Ninth Circuit very recently issued an opinion in Ruiz

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v. Affinity Logistics Corp., -- F.3d --, 2012 U.S. App. LEXIS

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2450, at *9 (9th Cir. Feb. 8, 2012), which may have some bearing

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on this dispute.

United States District Court

For the foregoing reasons, the Court, in its discretion,

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For the Northern District of California

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GRANTS Plaintiffs' motion for certification pursuant to 28 U.S.C.

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§ 1292(b) and STAYS this matter pending resolution of the

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interlocutory appeal before the Ninth Circuit.

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update the Court by joint submission within five court days of

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resolution of the appeal, or every 120 days, whichever is sooner.

The parties shall

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IT IS SO ORDERED.

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Dated:

February 16, 2012
UNITED STATES DISTRICT JUDGE

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