Coppernoll v. Hamcor, Inc.
Filing
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ORDER GRANTING MOTION FOR EQUITABLE TOLLING by Judge William Alsup [granting 51 Motion]. (whasec, COURT STAFF) (Filed on 4/27/2017)
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IN THE UNITED STATES DISTRICT COURT
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FOR THE NORTHERN DISTRICT OF CALIFORNIA
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WYATT COPPERNOLL,
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For the Northern District of California
United States District Court
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Plaintiff,
No. C 16-05936 WHA
v.
HAMCOR, INC.,
ORDER GRANTING MOTION
FOR EQUITABLE TOLLING
Defendant.
/
INTRODUCTION
In this putative wage-and-hour class action, plaintiff moves for equitable tolling of his
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putative Fair Labor Standards Act collective claims that were stayed by a previous order.
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For the reasons stated below, plaintiff’s motion is GRANTED.
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STATEMENT
In October 2016, Plaintiff Wyatt Coppernoll filed this putative wage-and-hour class
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action asserting claims under the Fair Labor Standards Act, the California Labor Code, and the
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California Business and Professions Code.
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Defendant Hamcor, Inc., moved to stay the action and compel arbitration pursuant to the
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arbitration sections of Coppernoll’s job application agreement and employment agreement with
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Hamcor. A January 2017 order denied that motion, finding both parties agreed the arbitration
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terms were unenforceable under Morris v. Ernst & Young, 834 F.3d 975 (9th Cir. 2016), and the
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fact that our Supreme Court granted a writ of certiorari did not change the law of our court of
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appeals for the time being (Dkt. No. 41). The order limited the parties, however, to individual
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discovery as to Coppernoll’s claims, rather than the putative class, pending the upcoming
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review of Morris.
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In February 2017, the parties stipulated request to stay all class and collective claims in
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the action was granted. The order staying the claims required the parties to update the
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undersigned on Morris by August 16, or when briefing was completed, whichever came sooner.
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Coppernoll now requests equitable tolling of the FLSA claims as of the order staying
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class discovery, January 12, 2017, and until the stay is lifted (Dkt. No. 56 at 2). Such an order
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would preserve claims of putative class members whose claims would otherwise be
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For the Northern District of California
United States District Court
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extinguished by the FLSA statute of limitations while the stay is in place.
This order follows full briefing and oral argument.
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ANALYSIS
For purposes of calculating the timeliness of a FLSA claim, the statute of limitations is
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tolled for each putative class member individually upon filing a written consent to become a
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party plaintiff. 29 U.S.C. 256(b). This opt-in standard differs from the opt-out standard in a
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Rule 23 class action, where the statute of limitations is tolled for all putative class members
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when the complaint is filed. Thus, without equitable tolling, the statute of limitations on a
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putative class member’s FLSA claim continues to run in the time between the filing of the
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collective action complaint and the filing of their written consent opting-in. See 29 U.S.C.
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256; Woodard v. FedEx Freight East, Inc., 250 F.R.D. 178, 194 (M.D. Pa. Feb. 19, 2008)
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(Judge Thomas Vanaskie).
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The legal issue presented is whether a court-issued stay pending our Supreme Court’s
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review of controlling precedent justifies equitably tolling the statute of limitations on FLSA
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collective action claims. Our court of appeals has not addressed the issue squarely, but it has
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provided guidance on equitably tolling FLSA claims generally.*
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* As noted in a previous order, both parties agree that Morris is controlling here (Dkt. No. 32).
Neither that order, nor this one, rules on the merits of that issue.
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The FLSA statute of limitations is a procedural limitation that may be tolled when
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equity warrants. See Partlow v. Jewish Orphan’s Home of Southern California, Inc., 645 F.2d
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757, 761 (9th Cir. 1981) (abrogated on other grounds). “Equitable tolling applies when the
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plaintiff is prevented from asserting a claim by wrongful conduct on the part of the defendant,
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or when extraordinary circumstances beyond the plaintiff’s control ma[ke] it impossible to file a
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claim on time.” Stoll v. Runyon, 165 F.3d 1238, 1242 (9th Cir. 1999).
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Coppernoll does not make this motion under the first standard, expressly disclaiming
not outright acknowledge the second standard — that an extraordinary circumstance beyond
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putative plaintiffs’ control prevents them from making a timely claim. Rather, he bases this
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For the Northern District of California
making this motion based on wrongful conduct by Hamcor (Dkt. No. 56 at 2). Coppernoll does
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United States District Court
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motion on the stay of FLSA proceedings in this action pending our Supreme Court’s disposition
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of Morris and provides similar district court decisions that equitably tolled FLSA claims
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pending California Supreme Court review of relevant decisions. See Castle v. Wells Fargo
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Financial, Inc., 2007 WL 1105118, at *2 (N.D. Cal. Apr. 10, 2007) (Judge Susan Illston);
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and Lew v. Countrywide Financial Corp., 2009 WL 1384975, at *3 (N.D. Cal. Feb. 24, 2009)
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(Judge Samuel Conti).
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Our court of appeals, however, has provided further guidance on the extraordinary
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circumstances route to equitable tolling. The rule from Stoll traces back to Forti v.
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Suarez-Mason, 672 F. Supp. 1531, 1549 (N.D. Cal. Oct. 6, 1987) (Judge D. Lowell Jensen),
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and its adoption by our court of appeals in Seattle Audubon Society v. Robertson, 931 F.2d 590,
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596 (9th Cir. 1991). In Seattle Audubon Society, plaintiffs’ claims were equitably tolled when
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they were prevented from pursuing their claims due to an unconstitutional statutory enactment
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and the district court’s enforcement of such. Ibid. The decision relied on the following
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explanation in Osbourne v. United States, 164 F.2d 767, 769 (2d Cir. 1947):
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All statutes of limitations are based on the assumption that one
with a good cause of action will not delay in bringing it for an
unreasonable period of time; but, when a plaintiff has been denied
access to the courts, the basis of the assumption has been
destroyed.
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Seattle Audubon Society, 931 F.2d at 596. The decision further recognized that “[e]ven when
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physical access to a functioning court is possible, equitable tolling may nevertheless be proper
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if there is no real possibility of gaining relief in court.” Ibid.
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Here, there is a stay in place on Coppernoll’s collective action claims preventing him
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from engaging in class discovery, filing a motion for class certification, or receiving approval
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to notice this action to putative class members. As such, putative members of the class are
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unlikely to receive notice of the pendency of this collective action until class proceedings
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resume — at which point, their claims may be extinguished. Moreover, these putative class
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members are presumably subject to the same or similar employment agreement Coppernoll
signed. As explained in a previous order, the collective action waiver in Coppernoll’s
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For the Northern District of California
United States District Court
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employment agreement forced all claims to arbitration, at which point they were only permitted
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to proceed individually (Dkt. No. 41). Under Morris, our court of appeals holds similar waivers
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unenforceable (ibid.). While Morris awaits review, however, the enforceability of Hamcor’s
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collective action waiver will not be ruled on, and the waiver may impede or dissuade potential
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claimants from seeking relief in court. Equity thus urges the tolling of the statute of limitations.
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Hamcor’s attempt to distinguish Castle and Lew goes no further than highlighting the
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fact that the decisions are not precedential and the precedent of our court of appeals allegedly
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provides reason for denying Coppernoll’s motion. Hamcor relies on a recitation of the Seattle
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Audubon Society standards in Alvarez-Machain v. United States, 107 F.3d 696, 701 (9th Cir.
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1996) (overruled on other grounds), and cites to three decisions denying equitable tolling based
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on those standards. See Bonilla v. Las Vegas Cigar Co., 61 F. Supp. 2d 1129, 1140 (D. Nev.
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Aug 18, 1999) (Judge Philip Pro); Veliz v. Cintas Corp, 2007 WL 841776, at *4 (N.D. Cal.
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Mar. 20, 2007) (Judge Saundra Armstrong); and Fichtner v. American Family Mutual Insurance
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Company, 2004 WL 3106753, at *10 (D. Or. Mar. 1, 2004) (Judge Michael Hogan). Each is
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distinguishable.
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Bonilla found that plaintiffs’ scattered locations around the country and inability to
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speak English did not constitute an extraordinary circumstance justifying tolling. The Veliz
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plaintiffs relied on the defendant’s wrongful conduct and presented no extraordinary
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circumstances in their attempt to justify tolling. Fichtner found that the defendant’s refusal to
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provide information on other employees was not the sort of exceptional circumstance justifying
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equitable tolling and further indicated that the asserted discovery violation lacked merit because
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plaintiff failed to file a motion to compel. None of these decisions present a situation where an
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unenforceable contract and a court-ordered stay effectively shut putative class members out of
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court.
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Alvarez-Machain did find equitable tolling justified. There, Alvarez-Machain’s “life
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was at stake, and his case involved numerous, complex issues of first impression — several
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of which were ultimately decided by the United States Supreme Court.” Alvarez-Machain,
107 F.3d at 701. The decision further noted that “had he filed an administrative claim prior to
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For the Northern District of California
United States District Court
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obtaining an acquittal, many of his claims would have been dismissed because they necessarily
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implicated the validity of his criminal charges.” Ibid. Similar to the instant order, our court of
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appeals justified equitable tolling based on considerations of our Supreme Court’s review and
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the futility of filing claims in the meantime.
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Next, Hamcor spent a portion of its brief arguing it did not engage in wrongful conduct
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that would justify equitable tolling. As noted above, Coppernoll did not claim as much.
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Nevertheless, Hamcor asserts that it should not be penalized for trying to protect its interests,
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citing Owens v. Bethlehem Mines Corp., 630 F. Supp. 309, 312 (S.D. W.Va. 1986)
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(Judge Charles Haden). In the event any damages do result from the stay, they will be minor,
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as review of Morris is slated for our Supreme Court’s October 2017 term and a decision is
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likely to be rendered by December.
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Hamcor also argues there is no requirement in the FLSA that a defendant provide
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contact information for potential plaintiffs until after a collective action is certified and thus,
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Coppernoll could be prevented from obtaining class discovery regardless. This proposition is
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supported by Adedapoidle-Tyehinba v. Crunch LLC, 2013 WL 4082137, at *7 (N.D. Cal. Aug.
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9, 2013) (Judge William Orrick); Gilberd v. Citigroup, Inc., 2009 WL 424320, at *5 (N.D. Cal.
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Feb. 18, 2009) (Judge Samuel Conti); and Prentice v. Fund for Public Interest Res– Inc., 2007
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WL 2729187, at *3 (N.D. Cal. Sep. 18, 2007) (Judge Samuel Conti). Prentice recognized that
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this is not a settled proposition. Gilberd and Adedapoidle-Tyehinba rely on Prentice. As this
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order does not rely on any such argument, it will not wade further into the issue.
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Hamcor additionally argues Coppernoll cannot represent a putative class member’s
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interests until the putative class member files a valid consent, asserting an individual employee
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cannot become a party to an action under the FLSA unless he or she does so. In support,
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Hamcor cites State of Nevada Employees’ Association v. Bryan, 916 F.2d 1384, 1391
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(9th Cir. 1990). SNEA is inapplicable here — the decision has nothing to do with equitable
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tolling. Rather, SNEA concerns whether an organization may bring FLSA claims on behalf
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of its members. Our court of appeals held the plaintiff did not have standing under the FLSA,
even if its members alleged personal injuries. Ibid.
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For the Northern District of California
United States District Court
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In the same vein, Hamcor argues there is no Article III power to prospectively suspend
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the statute of limitations for putative collective action members. Presumably because it could
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not find support in decisions of our court of appeals, Hamcor turns to United States v. Cook,
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795 F.2d 987, 994 (Fed. Cir. 1986). As Coppernoll points out, our court of appeals has never
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applied Hamcor’s proposed rule that FLSA claims cannot be prospectively tolled. The clear
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weight of decisions on the issue from courts in our circuit is in favor of prospectively tolling
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the statute of limitations for putative class members as equity demands. Koval v. Pacific Bell
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Telephone Co., 2012 WL 3283428, at *7 (N.D. Cal. Aug. 10, 2012) (Judge Claudia Wilken).
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See also Beaupherty v. 24 Hour Fitness USA, Inc., 2007 WL 707475, at *8 (N.D. Cal. Mar. 6,
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2007) (Judge Samuel Conti); and Helton v. Factor 5, Inc., 2011 WL 5925078, at *2 (N.D. Cal.
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Nov. 28, 2011) (Judge Saundra Armstrong).
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Here, absent tolling, putative class members with claims on the verge of being
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extinguished may have no other option but to give up their day in court and arbitrate
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individually instead. It is imprudent to encourage this result. It is also impractical to encourage
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the filing of numerous individual claims destined to be drawn through the same motion practice
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as Coppernoll, only to be stayed, as well, while we wait for a decision on Morris. This order,
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instead, GRANTS Coppernoll’s motion and equitably tolls the FLSA collective claims until the
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stay is lifted.
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It bears stating hat the Court would never have granted the stay requested by Hamcor
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if it had realized Hamcor would then use the stay to run out the statute of limitations as to
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potential opt-ins. This maneuver is too slick and too unfair.
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CONCLUSION
For the reasons stated above, Coppernoll’s motion for equitable tolling is GRANTED.
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The FLSA collective claims are tolled as of FEBRUARY 16, pursuant to the order granting their
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stay. Upon lifting the stay, the statue of limitations will resume.
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IT IS SO ORDERED.
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For the Northern District of California
United States District Court
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Dated: April 27, 2017.
WILLIAM ALSUP
UNITED STATES DISTRICT JUDGE
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