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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1 2 3 4 IN THE UNITED STATES DISTRICT COURT 5 FOR THE NORTHERN DISTRICT OF CALIFORNIA 6 7 ALEJANDRO JUAREZ, et al., Plaintiffs, 8 10 For the Northern District of California United States District Court 9 11 v. JANI-KING OF CALIFORNIA, INC., et al., Defendants. 12 13 ) ) ) ) ) ) ) ) ) ) ) ) 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 14 15 Plaintiffs Alejandro Juarez, Maria Juarez, and Maria Portillo 16 (collectively, "Plaintiffs") purchased cleaning service franchises 17 from Defendant Jani-King of California, Inc., Jani-King, Inc., and 18 Jani-King International, Inc. (collectively, "Defendants"). 19 cleaning service franchises turned out to be unprofitable, and 20 Plaintiffs subsequently brought this action against Defendants. 21 Among other things, Plaintiffs asserted claims under the California 22 Labor Code, alleging that they were misclassified as franchisees 23 because Defendants exercised such control over them so as to create 24 an employer-employee relationship. The 25 On January 23, 2012, the Court dismissed Plaintiffs' Labor 26 Code claims when it granted in part and denied in part Defendants' 27 motion for summary judgment. 28 Decision). ECF No. 168 (Summary Judgment The Court, relying on the California Court of Appeal's 1 decision in Cislaw v. Southland Corporation, 4 Cal. App. 4th 1284 2 (Cal. Ct. App. 1992), held that "[a] franchisee must show that the 3 franchisor exercised 'control beyond that necessary to protect and 4 maintain its interest in its trademark, trade name, and good will' 5 to establish a prima facie case of an employer-employee 6 relationship." 7 Cal. App. 4th at 1296). 8 that it should apply the test enunciated by the Ninth Circuit in 9 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 10 the Narayan test was inapposite in the franchise context. 11 9 n.2. 12 Id. at Plaintiffs now move the Court to certify for interlocutory 13 appeal that portion of the Court's Summary Judgment Decision 14 dismissing Plaintiffs' Labor Code claims and to stay further 15 proceedings pending that appeal. 16 have filed an opposition and Plaintiffs have filed a reply. 17 No. 179 ("Opp'n"), 180 ("Reply"). 18 1(b), the Court finds the Motion suitable for determination without 19 oral argument. 20 ECF No. 176 ("Mot."). Defendants ECF Pursuant to Civil Local Rule 7- A district court may certify for appellate review any order 21 that, in the court's opinion, "[1] involves a controlling question 22 of law [2] as to which there is substantial ground for difference 23 of opinion and [3] [where] an immediate appeal from the order may 24 materially advance the ultimate termination of the litigation." 25 28 U.S.C. § 1292(b). 26 to decide whether to grant a motion for certification. 27 Title Ins. Antitrust Litig., No. 08-01341 JSW, 2010 U.S. Dist. 28 LEXIS 28923, at *7 (N.D. Cal. Mar. 3, 2010). District courts have substantial discretion 2 In re Cal. 1 The parties agree that the Court's Summary Judgment Decision 2 regarding Plaintiffs' Labor Code claims involves a controlling 3 question of law and that an immediate appeal may materially 4 advance the ultimate termination of the litigation. 5 2-3, Opp'n at 1. 6 order for a question to be 'controlling' is that resolution of the 7 issue on appeal could materially affect the outcome of the 8 litigation in the district court." 9 673 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 10 Court's decision to apply the Cislaw "right-to-control" analysis 11 in the employment classification context is a controlling question 12 of law because it could affect the outcome of the summary decision 13 on Plaintiffs' Labor Code claims. 14 from the Court's Summary Judgment Decision would "materially 15 advance the ultimate termination of the litigation." 16 Circuit reverses and holds that Plaintiffs' Labor Code claims 17 raise triable issues of fact, the Court can hold a single trial to 18 address all claims at once. 19 Further, an immediate appeal If the Ninth The parties disagree about whether there is substantial ground 20 for difference of opinion regarding the question of law at issue. 21 Having reviewed the papers, the Court finds that there is 22 substantial ground for difference of opinion regarding the 23 application of Cislaw to Plaintiffs' Labor Code claims. 24 Court acknowledged in its order denying class certification, the 25 controlling authority on this issue "is not entirely clear." 26 130 at 22-23. 27 conclusions as to what test should apply to employment 28 classification claims brought in the franchise context. As the ECF Courts in other states have reached different 3 See Hayes 1 v. Enmon Enters., LLC, 10-CV-00382-CWR-LRA, 2011 U.S. Dist. LEXIS 2 66736 (S.D. Miss. June 22, 2011); Awuah v. Coverall N. Am. Inc., 3 707 F. Supp. 2d 80 (D. Mass. 2010); Coverall N. Am., Inc. v. 4 Division of Unemployment Assistance, 447 Mass. 852 (2006). 5 Further, the Ninth Circuit very recently issued an opinion in Ruiz 6 v. Affinity Logistics Corp., -- F.3d --, 2012 U.S. App. LEXIS 7 2450, at *9 (9th Cir. Feb. 8, 2012), which may have some bearing 8 on this dispute. United States District Court For the foregoing reasons, the Court, in its discretion, 10 For the Northern District of California 9 GRANTS Plaintiffs' motion for certification pursuant to 28 U.S.C. 11 § 1292(b) and STAYS this matter pending resolution of the 12 interlocutory appeal before the Ninth Circuit. 13 update the Court by joint submission within five court days of 14 resolution of the appeal, or every 120 days, whichever is sooner. The parties shall 15 16 IT IS SO ORDERED. 17 18 19 Dated: February 16, 2012 UNITED STATES DISTRICT JUDGE 20 21 22 23 24 25 26 27 28 4

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