Jorge Quezada v. Con-Way Inc.

Filing 194

ORDER DENYING 171 Motion to Decertify Class. Signed by Judge Jeffrey S. White on January 16, 2014. (jswlc3, COURT STAFF) (Filed on 1/16/2014)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA
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JORGE R. QUEZADA,

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Plaintiff,

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For the Northern District of California

United States District Court

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No. C 09-03670 JSW

v.
CON-WAY FREIGHT, INC.,

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ORDER REGARDING
DEFENDANT’S MOTION FOR
DECERTIFICATION

Defendant.
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Now before the Court is the motion to decertify the class filed by defendant Con-Way

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Freight, Inc. (“Defendant”). The Court has considered the parties’ papers, relevant legal

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authority, and it finds this matter suitable for disposition without oral argument. See N.D. Civ.

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L.R. 7-1(b). Accordingly, the hearing set for January 17, 2014 is VACATED. Having carefully

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reviewed the parties’ papers, considered their arguments and the relevant legal authority, the

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Court hereby denies Defendant’s motion.

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As the parties are familiar with the facts and procedural history of this case, there is no
need to recite them here, except where useful in reaching the disposition.
ANALYSIS

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A.

Legal Standard on Motion to Decertify.
Pursuant to Federal Rule of Civil Procedure 23(c)(1)(C), an order certifying a class

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“may be altered or amended before final judgment.” In considering a motion to decertify, “a

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court must reevaluate whether the class continues to meet the requirements of Rule 23.” Bruno

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v. Eckhart Corp., 280 F.R.D. 540, 544 (C.D. Cal. 2012). Plaintiff bear the burden of showing

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that class certification is still warranted. Marlo v. United Parcel Service, Inc., 639 F.3d 942,

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947 (9th Cir. 2011).

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B.

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Defendant’s Motion.
Defendant moves to decertify on the grounds that individual issues predominate. First,

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Defendant argues that individual issues predominate because the Court must make a

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determination for each hour worked by every linehaul driver in the class as to whether it is

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liable for failing to pay its employees less than minimum wage. According to Defendant, this

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may be considered a liability issue, an affirmative defense issue, or a damages issue.

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In the order granting Plaintiff’s motion for class certification, the Court noted that it was
troubled by Defendant’s late-shifting position at that stage in the litigation in an apparent

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For the Northern District of California

United States District Court

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attempt to evade the impact of the Court’s summary judgment ruling. Defendant is trying, yet

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again, to avoid the impact of the Court’s summary judgment ruling. The Court previously held

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on cross-motions for summary judgment that Defendant’s compensation scheme – purporting to

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include payment for certain tasks, such as waiting time, conducting inspections, and doing

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paperwork, in its piece rate compensation for driving – violates California law.

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Without moving for leave to file a motion for reconsideration of the Court’s

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determination of liability, Defendant argues that it is not liable for failing to compensate for

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certain tasks, so long as within an hour, an employee earns sufficient wages that amount to

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minimum wage through some task that is compensable. The first problem with Defendant’s

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argument is that it failed to properly move for leave to file a motion for reconsideration.

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Pursuant to Northern District Civil Local Rule 7-9, a party must seek leave to file of court

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before filing a motion for reconsideration. N.D. Civ. L.R. 7-9(a).

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Moreover, even if Defendant had moved for leave, it does not make any showing that

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leave would be warranted. A motion for reconsideration may be made on one of three grounds:

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(1) a material difference in fact or law exists from that which was presented to the Court, which,

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in the exercise of reasonable diligence, the party applying for reconsideration did not know at

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the time of the order; (2) the emergence of new material facts or a change of law; or (3) a

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manifest failure by the Court to consider material facts or dispositive legal arguments presented
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before entry of judgment. N.D. Civ. L.R. 7-9(b)(1)-(3). The moving party may not reargue any

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written or oral argument previously asserted to the Court. Id., 7-9(c). Defendant has not made

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a showing on any of these grounds.

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Finally, even if the Court were to grant leave to file a motion for reconsideration,

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Defendant has not demonstrated that the Court’s determination that Defendant’s pay scheme

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violates California law was incorrect. At most, Defendant cites to an unpublished district court

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case that does not analyze the case law on this topic. See Cole v. CRST, Inc., 2012 WL

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4479237, *7 (C.D. Cal. Sept. 27, 2012). Notably, the court in Cole fails to address the impact

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of California Labor Code sections 221, 222, and 223 on the determination of liability.
As the court addressed in Armenta v. Osmose, Inc., 135 Cal. App. 4th 314, 320 (2005),

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For the Northern District of California

United States District Court

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and as discussed in a persuasive DLSE opinion letter, California Labor Code sections 221, 222,

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and 223 require courts to consider whether an employee earns at least minimum wage for every

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hour (or part of every hour) in isolation as opposed to on average. Those statutory provisions

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“clearly prohibit an employer from receiving from the employee, withholding from the

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employee, or secretly paying to the employee, some amount less than the employee’s actual

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agreed wages for work performed by the employee. Id. California Labor Code sections 221,

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222, and 223 preclude an employer “from using any part of the wage payments that are required

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under [a collective bargaining agreement (“CBA”)] or other contract for activities that are

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compensated in an amount that equals or exceeds the minimum wage, as a credit for satisfying

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minimum wage obligations for those activities that are compensated at less than the minimum

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wage under the CBA or contract. ...” Id. (quoting the DLSE opinion letter dated January 29,

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2002).

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Defendant cites to language taken out of context from Armenta and in Gonzalez v.

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Downtown LA Motors, LP, 215 Cal. App. 4th 36, 46-47 (2013) to support its argument that so

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long as an employee receives at least minimum wage within every hour from compensable

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tasks, there is no violation of California law. (Mot. at 14 (quoting Armenta, 135 Cal. App. 4th

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at 324 (“[t]he minimum wage standard applies to each hour worked”) and Gonzalez, 215 Cal.

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App. 4th at 46-47 (same).) However, neither Armenta nor Gonzales held that an employer does
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not violate California law by failing to pay at least minimum wage for certain tasks, so long as

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an employee receives at least minimum wage from other tasks within an hour. In fact, as

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discussed above, the reasoning of both Armenta and Gonzales supports the opposite conclusion.

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See Armenta, 135 Cal. App. 4th at 323 (California Labor Code “Sections 221, 222, and 223

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articulate the principal that all hours must be paid at the statutory or agreed rate and no part of

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this rate may be used as a credit against a minimum wage obligation.”); Gonzalez, 215 Cal.

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App. 4th at 47-48.

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violates California law was not incorrectly decided. Based on the order on cross-motions for
summary judgment, Defendant’s liability has been established.

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For the Northern District of California

United States District Court

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Therefore, the Court finds that the determination that Defendant’s compensation scheme

Defendant further argues that the Supreme Court’s recent opinion in Comcast Corp. v.

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Behrend, --- U.S. ---, 133 S.Ct. 1426, 1433 (2013), supports decertification where “[q]uestions

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of individual damage calculations will inevitably overwhelm questions common to the class.”

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However, the Ninth Circuit clarified in Leyva v. Medline Industries, Inc., 716 F.3d 510 (9th Cir.

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2013), that Comcast reversed an order granting class certification because the plaintiffs in that

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case used a damages model that “did not isolate damages resulting from any one theory of

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antitrust impact.” Id. at 514 (quoting Comcast, 133 S.Ct. at 1431). Therefore, the plaintiffs

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failed to show that their damages stemmed from the defendant’s actions that created the legal

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liability. Id. In contrast, in Leyva, a wage-and-hour case, if the putative class members

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demonstrate the employer’s liability, then “damages will be calculated based on the wages each

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employee lost due to [the employer’s] unlawful practices.” Id.; see also In re: High-Tech

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Employee Antitrust Litig., --- F. Supp. 2d ---, 2013 WL 5770992, *13 (N.D. Cal. Oct. 24. 2013)

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(Comcast does not pose a barrier to class certification so long as “damages will be calculated

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based on the wages each employee lost due to [defendant]’s unlawful practices.”) (quoting

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Leyva, 716 F.3d at 513-14).

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The Ninth Circuit confirmed in Leyva that “[i]n this circuit, ... damage calculations alone

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cannot defeat certification.” Leyva, 716 F.3d at 513 (quoting Yokoyama v. Midland Nat’l Life

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Ins. Co., 594 F.3d 1087, 1094 (9th Cir. 2010). The court noted that “damages determinations
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are individual in nearly all wage-and-hour class actions.” Id. Here, as in Leyva, this is a wage-

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and-hour case. The damages that are owed to class members are owed due to Defendant’s

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unlawful practices. The fact that individualized determinations regarding the amount of

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damages owed to each class member may need to be made is insufficient, standing alone, to

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defeat certification. Id. Accordingly, the Court denies Defendant’s motion for decertification.

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CONCLUSION
For the reasons set forth above, the Court DENIES Defendant’s motion for
decertification.
IT IS SO ORDERED.

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For the Northern District of California

United States District Court

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Dated: January 16, 2014
JEFFREY S. WHITE
UNITED STATES DISTRICT JUDGE

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