Vedachalam v. Tata America International Corporation et al

Filing 277

ORDER GRANTING IN PART PLAINTIFFS #185 MOTION FOR CLASS CERTIFICATION, GRANTING PLAINTIFFS #181 MOTION TO APPOINT CLASS COUNSEL AND GRANTING DEFENDANTS #272 MOTION FOR LEAVE TO FILE A SECOND SUR-REPLY. Case Management Statement due by 4/18/2012. Case Management Conference set for 4/25/2012 02:00 PM. Signed by Judge Claudia Wilken on 4/2/2012. (ndr, COURT STAFF) (Filed on 4/2/2012)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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GOPI VEDACHALAM and KANGANA BERI,
on behalf of themselves and all
others similarly situated,

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United States District Court
For the Northern District of California

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No. C 06-0963 CW
ORDER GRANTING IN
PART PLAINTIFFS’
MOTION FOR CLASS
CERTIFICATION,
GRANTING
PLAINTIFFS’ MOTION
TO APPOINT CLASS
COUNSEL AND
GRANTING
DEFENDANTS’ MOTION
FOR LEAVE TO FILE
A SECOND SUR-REPLY
(Docket Nos. 181,
185 and 272)

Plaintiffs,
v.
TATA CONSULTANCY SERVICES, LTD,
an Indian Corporation; and TATA
SONS, LTD, an Indian Corporation,
Defendants.
________________________________/

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Plaintiffs Gopi Vedachalam and Kangana Beri charge Defendants
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Tata Consultancy Services, Ltd. (TCS) and Tata Sons, Ltd., with
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breach of contract and violations of California’s Labor Code and
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Unfair Competition Law (UCL).

Plaintiffs now move for class

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certification and appointment of class counsel.

Defendants oppose

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the motion for class certification, but do not oppose the motion
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for appointment of class counsel.

Having considered the papers

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filed by the parties and their oral arguments at the hearing, the
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Court GRANTS in part Plaintiffs’ motion for class certification,
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GRANTS Plaintiffs’ motion for appointment of class counsel, and
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GRANTS Defendants’ motion for leave to file a second sur-reply.
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BACKGROUND
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Tata Sons and TCS, a division of Tata Sons, are Indian
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corporations headquartered in Mumbai, India.

TCS offers

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information technology services to clients located worldwide.
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To serve its clients, TCS deploys its employees to client

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sites worldwide on temporary assignments, known as “deputations.”

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Before an employee departs on a deputation, TCS and the employee

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undertake several steps.

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States non-immigrant visa on behalf of the employee; in this visa

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petition, TCS provides a sworn statement to the United States

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government stating the amount of compensation to be paid to the

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employee in the United States.

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TCS’s policy that TCS and the employee enter into a deputation

TCS first files a petition for a United

After a visa is obtained, it is

United States District Court
For the Northern District of California

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agreement (DA) and deputation terms agreement (DTA).

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Defendants, TCS has a “standard guideline” DTA, which they

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describe as a form with blanks that TCS was supposed to complete

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and have each deputed employee sign.

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Ex. B, Tr. of Deposition of Ashok Mukherjee, at 143:8-144:12,

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146:6-24.

According to

See Hutchinson Decl. ¶ 4,

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The standard DTA states in part,

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(B) Salary and Benefits in India. As stated in the
Deputation Agreement, you will continue to receive your
salary and benefits in India during the period of the
Deputation, subject to any tax requirements of the
United States and its states.
(C) Compensation in the United States. In addition to
the compensation and benefits you currently receive and
will continue to receive in India while on Deputation,
you shall receive additional compensation in the United
States in the gross amount of $________, less deductions
required by law or otherwise voluntarily authorized by
you. This compensation shall be for living and other
expenses in the United States.
(D) Total Gross Compensation. Amounts of salary paid by
TCS in India (under Paragraph 4 (b) above) and the
additional compensation in the United States (under
Paragraph 4(c) above) shall be aggregated and thus shall
be treated as your total gross compensation for purposes
of U.S. law with respect to your employment in the
United States.

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According to Defendants, the blank space in section C was

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completed in one of four different manners: (1) $______;

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(2) $50,000; (3) $_______ ($50,000); or (4) $45,000 ($50,000).

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Some deputed employees also signed another form referred to

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as the Authorization for Payroll Deductions (APDs).

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contains an overall gross wage, as well as wages to be paid in

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India and in the United States.

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deductions that the deputed employees authorized from their United

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States wages.

United States District Court
For the Northern District of California

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The APD

The APD also states certain

For example, one APD executed within the class

period states in part,

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I confirm that my rate of gross pay will be U.S.$ 41718
per year during my deputation in the United States. The
composition of my gross pay is indicated below.
I hereby authorize TCS to deduct all applicable U.S.
Federal and State income and employment taxes from my
gross pay. In addition, I authorize TCS to deduct, in
monthly installments, the amounts listed below under
Voluntary Deductions from my net pay for matters for my
benefit. I understand that the deductions are not
conditions of employment and will not exceed 25% of my
disposable earnings in any work period.

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I.

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1.

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2.
II.
1.
2.
3.
4.
5.
6.
7.

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III.
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IV.

Gross Wages:
$ 41718
Wages paid in India
$ 6234
(Indian wages to be paid in Rupees)
Wages paid in the United States (I-I.1=I.2) $ 35484
Deductions from US Component of Gross Wages:
Federal Income Tax
State Income Tax
Local Income Tax
SUI/SDI
Social security Tax
Medicare Tax
Total deductions from U.S. component of gross
wages:
$ 8665
Net pay in the United States (I.2 minus II.7=III) :
$ 26819
Voluntary deductions from Net pay in the U.S.
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1. Medical insurance premium :
$ 336
2. Car loan payment :
$
3. Other deductions :
$ 419
(Specify :
Total Deductions
$ 755
V.
Net Take Home pay in the U.S. (III. minus IV.4 = V)
$ 26064

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Smith Decl., Ex. BW.1

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did deputed employees authorize TCS to deduct their Indian wages

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from their United States wages or to keep over-withheld tax

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deductions.

United States District Court
For the Northern District of California

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In none of the APDs provided by Defendants

See Smith Decl., Exs. AJ, BH, BI, BT, BU, BV, BW, BX,

BY.
Various policies and procedures governed deputations, several

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of which changed in July 2005.

Before July 2005, TCS handled

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employees’ federal and state income tax obligations, including

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setting the number of tax withholding exemptions claimed by

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employees and filing tax returns on employees’ behalf.

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of tax withholding exemptions changed periodically for some

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employees.

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employee, TCS placed a stamp on the back of the check that read,

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“Pay to the order of Tata Consultancy Services, Limited,” and sent

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the check to the employee with an “urgent memo” directing the

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employee to endorse it and return it to TCS.

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changed its handling of employees’ income taxes.

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its employees to file their own federal and state tax returns.

The number

When TCS received a tax refund check for a deputed

In July 2005, TCS
It now requires

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1

Defendants have submitted two APDs for deputed employees
that fall within the proposed class period, see Smith Decl., Exs.
AJ, BW, and six APDs that are dated prior to the proposed class
period, see Smith Decl., Exs. BH, BI, BT, BU, BV, BX, BY.
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1

Before July 2005, TCS compensated deputed employees in the

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United States both by depositing funds into their accounts in

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India and by issuing them paychecks in the United States.

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issuing paychecks in the United States, TCS deducted the amount of

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the deputed employees’ Indian wages from their United States

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wages.

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employees now earn only a gross salary, paid in the United States.

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Plaintiffs initiated this lawsuit on February 14, 2006.

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TCS changed this compensation scheme in July 2005.

When

TCS

On

April 25, 2011, Plaintiffs filed this motion for class

United States District Court
For the Northern District of California

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certification, in which they sought certification of two classes

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and one subclass.

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Plaintiffs sought to certify under Rule 23(b)(3) a national class

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defined as, “All non-U.S. citizens who were employed by Tata in

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the United States at any time from February 14, 2002 through June

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30, 2005.”

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the national class definition to include only those “who were

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deputed to the United States after January 1, 2002.”

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To prosecute their claims under California law alleging improper

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recoupment of wages, waiting time penalties, and inaccurate wage

To prosecute their breach of contract claim,

Mot. at 2.

In their reply, Plaintiffs further limit

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Reply, at 3.

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statements,2 Plaintiffs sought to certify under Rule 23(b)(3) a

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California class defined as, “All non-U.S. citizens who were

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employed by Tata in California at any time from February 14, 2002

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through the date of judgment.”

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Id.3

On July 13, 2011, this Court granted in part and denied in
part Defendants’ motion for partial summary judgment.

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held, inter alia, that Plaintiffs had not alleged in their

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complaint that Defendants’ deduction of deputed employees’ Indian

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salaries from their American salaries violated California Labor

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United States District Court
For the Northern District of California

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Code section 221 and dismissed that claim to the extent that it

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was premised on Indian salary deductions.

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Plaintiffs leave to amend their complaint to seek relief on their

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section 221 claims on these grounds.

The Court

The Court granted

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Plaintiffs previously asserted a claim against Defendants
for failure to pay terminated employees for vested but unused
vacation time at the time of discharge in violation of California
Labor Code § 227.3. First Amended Compl. (1AC) ¶¶ 128-37. They
initially sought certification of the California class to pursue
this claim as well. Mot. at 1, n.1. After Plaintiffs filed their
motion for class certification, this Court granted summary
judgment in favor of Defendants on Plaintiff Beri’s individual
claim for unpaid accrued vacation pay. Order Granting in Part and
Denying in Part Defs.’ Mot. for Partial Summ. J., Docket No. 215,
19-22. Plaintiffs subsequently removed this cause of action from
their Second Amended Complaint (2AC) and clarified at the hearing
that they no longer seek certification to pursue this claim.
3

To prosecute their claims seeking injunctive and
declaratory relief for their claim under California law regarding
inaccurate wage statements, Plaintiffs also initially sought to
certify under Rule 23(b)(2) a California current employee subclass
defined as, “All non-U.S. citizens who were employed by Tata in
California on or after February 14, 2006 through the date of
judgment.” Mot. at 2. At the hearing on November 17, 2011,
Plaintiffs clarified that they were no longer seeking
certification of a Rule 23(b)(2) class.
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1
2

On September 16, 2011, Defendants filed their opposition to
Plaintiffs’ motion for class certification.

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On September 20, 2011, Plaintiffs filed a second amended

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complaint (2AC).

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as to their section 221 claim based on the deduction of Indian

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salary.

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In the 2AC, Plaintiffs remedied the deficiency

On November 3, 2011, Plaintiffs filed a revised reply.

In

their reply, Plaintiffs make clear that they are seeking

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certification to prosecute on a class-wide basis their claim that

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United States District Court
For the Northern District of California

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Defendants’ deduction of deputed employees’ Indian salaries from

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their American salaries violated California Labor Code section

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221.

See Reply, at 20.

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DISCUSSION
I.

Motion for Leave to File a Second Sur-reply

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On December 2, 2011, Defendants filed a motion for leave to

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file a second sur-reply to address certification of the class to

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prosecute Plaintiffs’ section 221 claim for deducting class

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members’ Indian salary from their United States compensation.

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With their motion, Defendants submitted a proposed eight-page sur-

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reply.

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The Court GRANTS Defendants’ motion for leave to file a

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sur-reply.

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in the proposed sur-reply that address certification of the

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California class to prosecute Plaintiffs’ section 221 claim based

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on the deduction of Indian salary and that Defendants could not

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have previously made in opposition to certification of the

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national class to prosecute Plaintiffs’ breach of contract claim

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based on the deduction of Indian salary.

However, the Court will consider only those arguments

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1

II.

Defendants’ Evidentiary Objections

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Defendants seek to strike the declarations Plaintiffs

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submitted from putative class members, on the grounds that they

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are “cookie cutter” declarations made without the declarants’

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personal knowledge, that they contradict the declarants’

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deposition testimony, and that eight declarants were not produced

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for depositions.

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“On a motion for class certification, the Court makes no
findings of fact and announces no ultimate conclusions on

United States District Court
For the Northern District of California

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Plaintiffs’ claims” and therefore “the Court may consider evidence

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that may not be admissible at trial.”

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Prods., Inc., 268 F.R.D. 330, 337 n.3 (N.D. Cal. 2010).

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Defendants do not include specific evidentiary objections in their

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opposition, as required by Local Rule 7-3, and instead make

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general and conclusory objections to all of Plaintiffs’

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declarations.

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declarations contradict the subsequent deposition testimony, the

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discrepancies that they point out in their opposition appear

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primarily because Defendants rely on excerpts of lengthy

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depositions.

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diminished when placed in the context of additional deposition

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testimony.

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those at issue in Evans v. IAC/Interactive Corp., 244 F.R.D. 568

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(C.D. Cal. 2007), which contained statements that were “admittedly

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false,” were clearly “simply made up by the declarant,” or “for

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which the declarants lacked actual knowledge.” Id. at 578.

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in that case, the court declined to strike the declarations at

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issue, but instead considered these factors when determining how

Keiholtz v. Lennox Hearth

While Defendants argue that some of the

The apparent contradictions are resolved or greatly

This distinguishes the declarations at issue from

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Even

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much weight to give them.

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specific facts or persuasive arguments that any of the

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declarations were made without the declarants’ personal knowledge.

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Defendants also seek to strike eight specific declarations on

Id. at 571.

Defendants offer no

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the basis that Plaintiffs did not make the declarants available

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for depositions.

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cite Rojas v. Zaninovich, Inc., 2011 WL 2636071 (E.D. Cal.), in

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which, in response to a motion to compel, the court directed the

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plaintiffs to make “all good faith efforts” to produce a subset of

In support of their argument, Defendants only

United States District Court
For the Northern District of California

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class members who had submitted declarations in support of class

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certification.

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produce all absent class members who had done so, and warned the

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plaintiffs that the declarations of class members who willfully

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failed to appear for depositions would be struck.

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Defendants failed to subpoena six of these declarants, Shaver

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Reply Decl. ¶ 48, and did not file a motion to compel the

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depositions of any of them.

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20

The court did not require the plaintiffs to

Here, however,

Accordingly, Defendants’ request to strike is DENIED.
III. Plaintiffs’ Evidentiary Objections
Plaintiffs object to the report and supplemental report of

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Defendants’ expert witness Bernard Siskin and to Defendants’ 2006

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internal audit examining DTAs executed between 2000 and 2005.

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Defendants have addressed Plaintiffs’ objections in their first

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sur-reply.

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Plaintiffs object to Dr. Siskin’s initial report on the basis

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that it required no expert skill and contains errors and legal

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conclusions unhelpful to the Court and which the expert is not

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qualified to make.

Defendants respond that Dr. Siskin’s report
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contains statistical analysis for which he is qualified and that

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his statistical summary is helpful to the Court.

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Dr. Siskin reviews a sample of DTAs that Defendants provided to

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Plaintiffs and provides an opinion that the typed $50,000 figure

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was a “sample figure” and there was “no common, consistent or

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reliable information about what U.S. compensation was promised to

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a TCS employee.”

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displays how frequently the blanks in DTAs were completed in

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various ways and how the compensation amount compares to the

United States District Court
For the Northern District of California

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In his report,

The report also has data tables where Dr. Siskin

amount of compensation stated in visa applications.
The Court SUSTAINS in part and OVERRULES in part Plaintiffs’

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objections to Dr. Siskin’s report.

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data summaries that Dr. Siskin created, and will take into account

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the purported mistakes that Plaintiffs point out in determining

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how much weight to accord them, and in comparing them to the

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corresponding data summaries prepared by Plaintiffs.

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Court excludes Dr. Siskin’s opinions.

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does not explain the basis for his opinions.

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demonstrate that he is an expert in contract interpretation or

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determining whether a particular contract term was a sample or

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intended term.

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factors: that the figure is “in parentheses,” see Siskin Decl. ¶

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16; that $50,000 is typed more frequently than it is handwritten

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and that other figures are more frequently handwritten, see id. at

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¶ 17; that $50,000 rarely appears on visa petitions, see id. at ¶

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18; and that only one of the DTAs with the figure $50,000 had a

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“corresponding” visa petition with a compensation amount close to

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$50,000, id.

The Court will consider the

However, the

In his report, Dr. Siskin
He does not

He appears to base his opinions on several

Dr. Siskin does not offer evidence of any scientific
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1

methodology at all, let alone a reliable and valid methodology,

2

that would allow a statistician to determine that a compensation

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amount entered on a contract did not accurately reflect what was

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promised in that contract, even though it appeared there.

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Defendants’ assertions, Dr. Siskin does not refer to correlations

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or any other types of statistical tests that he used to compare

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the figures on an objective basis; instead, he only presents the

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data in descriptive terms and does not explain how he derives his

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opinions from these descriptions.

United States District Court
For the Northern District of California

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Despite

Plaintiffs also object to Dr. Siskin’s supplemental report,

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filed on October 26, 2011, two days before Plaintiffs’ reply

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deadline.

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of his data summaries with those created by Plaintiffs, using an

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Excel document that Plaintiffs provided to him on October 17,

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2011.

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supplemental report to the extent Dr. Siskin puts forward the same

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opinions as in his original report and DENIES Plaintiffs’

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objection to the extent it pertains to the data summaries

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themselves.

In this report, Dr. Siskin attempts to reconcile some

The Court SUSTAINS Plaintiffs’ objection to the

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Plaintiffs also object to the 2006 Internal Audit of DTAs and

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other documents, on which Defendants rely to argue that many class

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members did not enter into DTAs.

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cannot locate seventy-five percent of the DTAs that were examined

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in the audit and, thus, Plaintiffs cannot verify or challenge its

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findings.

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concealed and withheld the audit from discovery for years,” by

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disclosing it for the first time with their opposition and not

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turning it over in initial or revised disclosures or in response

Plaintiffs state that Defendants

Plaintiffs also assert that Defendants have “improperly

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1

to document requests and Court orders.

2

Plaintiffs’ objection to the 2006 Internal Audit but will consider

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Plaintiffs’ arguments in determining the amount of weight to

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accord this evidence.

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IV.

The Court DENIES

Motion for Class Certification

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A. Legal Standard

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Plaintiffs seeking to represent a class must satisfy the

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threshold requirements of Rule 23(a) as well as the requirements

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for certification under one of the subsections of Rule 23(b).

United States District Court
For the Northern District of California

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Rule 23(a) provides that a case is appropriate for certification

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as a class action if
(1) the class is so numerous that joinder of all
members is impracticable;
(2) there are questions of law or fact common to the
class;
(3) the claims or defenses of the representative
parties are typical of the claims or defenses of the
class; and
(4) the representative parties will fairly and
adequately protect the interests of the class.

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Fed. R. Civ. P. 23(a).

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may be certified as a class action only if one of the following is

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true:

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Rule 23(b) further provides that a case

(1) prosecuting separate actions by or against
individual class members would create a risk of:
(A) inconsistent or varying adjudications with
respect to individual class members that would
establish incompatible standards of conduct for the
party opposing the class; or
(B) adjudications with respect to individual class
members that, as a practical matter, would be
dispositive of the interests of the other members
not parties to the individual adjudications or
would substantially impair or impede their ability
to protect their interests;
(2) the party opposing the class has acted or refused to
act on grounds that apply generally to the class, so
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United States District Court
For the Northern District of California

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that final injunctive relief or corresponding
declaratory relief is appropriate respecting the class
as a whole; or
(3) the court finds that the questions of law or fact
common to class members predominate over any questions
affecting only individual members, and that a class
action is superior to other available methods for fairly
and efficiently adjudicating the controversy. The
matters pertinent to these findings include:
(A) the class members’ interests in individually
controlling the prosecution or defense of separate
actions;
(B) the extent and nature of any litigation
concerning the controversy already begun by or
against class members;
(C) the desirability or undesirability of
concentrating the litigation of the claims in the
particular forum; and
(D) the likely difficulties in managing a class
action.

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Fed. R. Civ. P. 23(b).

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California classes qualify for certification under subdivision

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(b)(3).

Plaintiffs assert that the national and

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Plaintiffs seeking class certification bear the burden of

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demonstrating that each element of Rule 23 is satisfied, and a

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district court may certify a class only if it determines that the

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plaintiffs have borne their burden.

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Falcon, 457 U.S. 147, 158-61 (1982); Doninger v. Pac. Nw. Bell,

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Inc., 564 F.2d 1304, 1308 (9th Cir. 1977).

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a “‘rigorous analysis,’” which may require it “‘to probe behind

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the pleadings before coming to rest on the certification

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question.’”

24

(2011) (quoting Falcon, 457 U.S. at 160-61).

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‘rigorous analysis’ will entail some overlap with the merits of

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the plaintiff’s underlying claim.

27

131 S. Ct. at 2551.

Gen. Tel. Co. of Sw. v.

The court must conduct

Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2551
“Frequently that

That cannot be helped.”

Dukes,

To satisfy itself that class certification is

28
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1

proper, the court may consider material beyond the pleadings and

2

require supplemental evidentiary submissions by the parties.

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Blackie v. Barrack, 524 F.2d 891, 901 n.17 (9th Cir. 1975).

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Ultimately, it is in the district court’s discretion whether a

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class should be certified.

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(9th Cir. 2003); Burkhalter Travel Agency v. MacFarms Int’l, Inc.,

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141 F.R.D. 144, 152 (N.D. Cal. 1991).

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B. Rule 23(a) Requirements

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1.

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United States District Court
For the Northern District of California

Molski v. Gleich, 318 F.3d 937, 946

Numerosity

Defendants concede that they deputed 13,121 employees to the

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United States between February 14, 2002 and June 30, 2005.

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at 2.

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6,244 California class members as of March 2010.

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¶ 77, Ex. 19, 5.

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and California classes meet the numerosity requirement.

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Accordingly, the Court finds that Plaintiffs have satisfied this

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requirement.

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Plaintiffs have submitted evidence that there were at least

2.

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Opp.

Hutchinson Decl.

Defendants do not dispute that both the national

Commonality

Rule 23 contains two related commonality provisions.

Rule

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23(a)(2) requires that there be “questions of law or fact common

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to the class.”

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requires that such common questions predominate over individual

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ones.

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Fed. R. Civ. P. 23(a)(2).

Rule 23(b)(3), in turn,

The Ninth Circuit has explained that Rule 23(a)(2) does not

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preclude class certification if fewer than all questions of law or

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fact are common to the class:

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The commonality preconditions of Rule 23(a)(2) are less
rigorous than the companion requirements of Rule
23(b)(3). Indeed, Rule 23(a)(2) has been construed
14

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2
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permissively. All questions of fact and law need not be
common to satisfy the rule. The existence of shared
legal issues with divergent factual predicates is
sufficient, as is a common core of salient facts coupled
with disparate legal remedies within the class.
Hanlon v. Chrysler Corp., 150 F.3d 1011, 1019 (9th Cir. 1998).

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Plaintiffs contend that there are numerous common questions
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of fact and law concerning Defendants’ alleged illegal employment
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practices, including the interpretation of the standard
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compensation clauses in the form DTA entered into by all class
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members, whether Defendants had a policy or practice of requiring
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deputed employees to sign over their tax refund checks to
10
United States District Court
For the Northern District of California

Defendants, and whether Defendants had a policy or practice of
11
deducting the Indian salary of deputed employees from their
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American salaries, rather than paying deputed employees both
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salaries.

Plaintiffs cite a number of cases involving form

14
contracts, in which courts have found that the commonality
15
requirement was met.
16
Plaintiffs present evidence that, in all of the earnings
17
statements Defendants produced for the class period, Defendants
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deducted the Indian salary from the American salary, Shaver Decl.
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¶ 8, and Defendants do not argue that they did not have a policy
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and practice of deducting class members’ Indian salary from their
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United States salary.

Instead, Defendants assert that this case

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does not meet Rule 23(b)(3)’s commonality provision, because no
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form contract exists, there is no policy or practice of requiring
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class members to sign over their tax refund checks, and there is
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no policy or practice of providing inaccurate wage statements.
26
Defendants also argue that there is no common interpretation of
27
the purportedly ambiguous contract language.
28
15

Because Defendants

1

repeat many of their arguments in disputing that the predominance

2

requirement is met, the Court will address those arguments in its

3

discussion of predominance.

4

Defendants argue that, even though their own policies

5

required that Defendants enter into a DTA with each employee prior

6

to a deputation, many putative members of the national class did

7

not enter into any “form contract” and, thus, they do not share

8

common questions as to whether such a contract was breached.

9

Defendants point to several sources to support their contention

United States District Court
For the Northern District of California

10

that some class members did not enter into the form DTA contracts.

11

First, Defendants point to a 2006 internal audit, which they

12

say demonstrates that they did not consistently use DTAs, because

13

between 2000 and 2006, only “62% of TCS employees deputed to the

14

United States entered into complete DTAs.”

15

The Court finds that this audit does not provide persuasive

16

evidence that Defendants did not consistently use DTAs during the

17

class period.

18

before and after the class period for the national class, and

19

Defendants provide no evidence which would support that the

20

thirty-eight percent of TCS employees without “complete DTAs” were

21

deputed within the class period.

22

evidence that, of the small fraction of files that Defendants can

23

now locate from the audit, over forty percent were from 2006,

24

after the end of the national class period.

25

time period in the audit before the start of the class period,

26

which was approximately one-third of the time covered by the audit

27

in total, Defendants did not yet use DTAs for deputed employees.

28

Further, the audit summary does not state that the thirty-eight

Mukherjee Decl. ¶ 9.

The audit encompasses substantial time periods both

Instead, Plaintiffs offer

16

Furthermore, for the

1

percent of deputed employees without complete DTAs did not enter

2

into a DTA with Defendants at all; instead, it indicates that

3

thirty-eight percent of the deputed employees entered into a DTA

4

that was not in “total compliance.”

5

This included, for example, a DTA missing the date or the employee

6

number.

Mukherjee Decl. ¶ 9, Ex. A.

Id.

7

Defendants also assert that documentary evidence proves that

8

many of the putative class members who submitted declarations did

9

not have DTAs.

They state that, “out of the 35 declarants made

United States District Court
For the Northern District of California

10

available by Plaintiffs for deposition, only 12 of them had DTAs”

11

that can now be located, even though Defendants acknowledge that

12

additional declarants testified that they had signed DTAs.

13

at 16.

14

DTAs that they were able to locate in their own records, excluding

15

those of the two named Plaintiffs.

16

(providing copies of the DTAs of twelve deponents).

17

are unpersuasive; Defendants do not provide evidence that they

18

were able to locate all DTAs that ever existed, and there is

19

evidence that they could not: in response to Plaintiffs’ request

20

for the DTAs underlying the 2006 audit, Defendants have thus far

21

only located about 24.9% of the DTAs that were known to have

22

existed and were examined in the audit.

23

also Siskin Decl. ¶ 4 (of 466 randomly selected employees from

24

within the class period, Defendants were only able to produce 200

25

complete files).

26

documents does not mean that they did not exist at some point.

Opp.

Defendants appear to base their arguments on the number of

See Smith Decl. ¶¶ 42-54
These numbers

Reply, at 3 and n.5.

See

Thus, the fact that Defendants do not have these

27

Finally, Defendants assert that the deposition testimony of

28

six declarants establishes that they did not sign DTAs and imply
17

1

that the testimony contradicts information in some of their

2

declarations.

3

testimony establishes that the putative class member declarants

4

did not sign DTAs during the class period.4

5

testimony to which Defendants point only shows either that the

6

declarants did not sign a DTA prior to the start of the class

7

period or that the declarants signed various contracts with

8

Defendants during the class period and could not remember

9

specifically what each agreement was called.

United States District Court
For the Northern District of California

10

The Court is not persuaded that the deposition

The deposition

Defendants also argue that the DTA was not a form contract

11

because of variation in how the blank was completed in the section

12

of the DTA entitled, “Compensation in the United States,” quoted

13

above, and because the interpretation of the agreement could

14

require consideration of extrinsic evidence.

15

a form contract drafted by Defendants and the executed DTAs are

16

identical in regards to almost every material term, including the

17

provision stating that the employees would be paid a United States

18

salary “in addition to” the amount they are paid in India and the

19

reference to “gross compensation.”

20

“Check Loan” Contract Litigation, 274 F.R.D. 286, 291-92 (N.D.

21

Cal. 2011) (where terms of agreements were “materially similar,”

22

even though there was variation in the specific text, and “the

However, the DTA is

See In re Chase Bank USA, N.A.

23
24
25
26
27
28

4

Plaintiffs state that, after submitting the declaration of
Sridhar Venkateswaran, they learned that he was in fact not a
putative class member, because he was not employed by Defendants
and was instead employed only by a separate entity, Tata Infotech,
which is not a party to this case. Because Venkateswaran is not a
putative class member, whether or not he signed a DTA during the
class period is irrelevant here.
18

amount of damages incurred by any particular class member may

2

differ,” the differences do not defeat certification under the

3

commonality prong, “even where individualized evidence may be

4

necessary for purposes of a damages calculation”).

5

Defendants could establish some ambiguity with extrinsic evidence,

6

the ambiguous contract terms would interpreted against them, as

7

the drafters of the form contract.

8

Contracts § 206 (“In choosing among the reasonable meanings of a

9

promise or agreement or a term thereof, that meaning is generally

10
United States District Court
For the Northern District of California

1

preferred which operates against the party who supplies the words

11

or from whom a writing otherwise proceeds.”); Cal. Civ. Code

12

§ 1654 (“In cases of uncertainty not removed by the preceding

13

rules, the language of a contract should be interpreted most

14

strongly against the party who caused the uncertainty to exist.");

15

Tahoe National Bank v. Phillips, 4 Cal. 3d 11, 20 (1971) (“Since

16

the alleged ambiguities appear in a standardized contract, drafted

17

and selected by the bank, which occupies the superior bargaining

18

position, those ambiguities must be interpreted against the

19

bank.”).

20

issue, as there is here, “the agreement ‘is interpreted wherever

21

reasonable as treating alike all those similarly situated, without

22

regard to their knowledge or understanding of the standard terms

23

of the writing.’”

24

(N.D. Cal.) (quoting Restatement (Second) of Contracts § 211(2)).

25

“‘[C]ourts in construing and applying a standardized contract seek

26

to effectuate the reasonable expectations of the average member of

27

the public who accepts it.’”

28

Contracts § 211(2), at Comment e) (formatting in original).

Even if

See Restatement (Second) of

Further, when there is a form contract of adhesion at

Ewert v. eBay, Inc., 2010 WL 4269259, at *7

Id. (quoting Restatement (Second) of

19

1

Accordingly, in construing the form contract between Defendants

2

and class members, the Court need not delve into the actual

3

knowledge of individual class members.

4

dispute that there are at least some identical material contract

5

provisions, their arguments about the amounts in the compensation

6

blank go more properly to whether individual questions

7

predominate.

8
9

Because Defendants do not

Defendants rely heavily on Wal-Mart Stores, Inc. v. Dukes,
131 S. Ct. 2541 (2011), to argue that commonality cannot be found

United States District Court
For the Northern District of California

10

here.

11

certification had not provided evidence sufficient to find that

12

there was a company-wide discriminatory pay and promotion policy.

13

Id. at 2555-57.

14

persuasive evidence that Defendants had a policy of requiring

15

deputed employees to sign form DTAs, which materially varied only

16

in the amount of additional compensation, and Defendants have not

17

produced convincing evidence to disprove this.

18

undisputed policy that Defendants deducted Indian salary from

19

deputed employees’ American paychecks during the class period.

20

There was an undisputed policy that Defendants sent income tax

21

refund checks to deputed employees, stamped to pay to the order of

22

Defendants.

23

generate common answers regarding whether Defendants engaged in

24

practices that violated the parties’ agreements and California

25

law.

26
27

In Dukes, the Supreme Court found that the party seeking

However, here, Plaintiffs have provided

There was an

Accordingly, here, a class-wide proceeding will

Thus, the Court finds that Plaintiffs have satisfied their
burden to meet the commonality requirement.

28
20

1
2

3.

Typicality

Rule 23(a)(3)’s typicality requirement provides that a “class
representative must be part of the class and possess the same

4

interest and suffer the same injury as the class members.”

5

Falcon, 457 U.S. at 156 (quoting E. Tex. Motor Freight Sys., Inc.

6

v. Rodriguez, 431 U.S. 395, 403 (1977)) (internal quotation marks

7

omitted).

8

interest of the named representative aligns with the interests of

9

the class.”

Hanon v. Dataproducts Corp., 976 F.2d 497, 508 (9th

10
United States District Court
For the Northern District of California

3

Cir. 1992).

Rule 23(a)(3) is satisfied where the named plaintiffs

11

suffered the same or similar injury as the unnamed class members,

12

the action is based on conduct which is not unique to the named

13

plaintiffs, and other class members have been injured by the same

14

course of conduct.

15

however, “where a putative class representative is subject to

16

unique defenses which threaten to become the focus of the

17

litigation.”

18

Lynch, Pierce, Fenner & Smith, Inc., 903 F.2d 176, 180 (2d Cir.

19

1990).

The purpose of the requirement is “to assure that the

Id.

Class certification is inappropriate,

Id. (quoting Gary Plastic Packaging Corp. v. Merrill

20

Defendants’ arguments against typicality overlap

21

substantially with their arguments against commonality and

22

predominance.

23

same way toward Plaintiffs and the other putative class members or

24

that Defendants applied common policies to both.

25

argue that named Plaintiffs and the DTAs that they signed are not

26

typical of the class because there are no form contracts shared by

27

all class members.

28

discussing the commonality and predominance requirements.

Defendants do not dispute that they acted in the

Instead, they

The Court addresses this argument in

21

1

Defendants also argue that Plaintiff Beri is not typical of

2

the class, because Defendants may be able to develop a mutual

3

mistake affirmative defense against her regarding the amount of

4

compensation proven.

5

First, the availability of this defense is speculative at this

6

point; Defendants do not assert that they have any evidence in

7

support of this defense, but rather state that they will develop

8

the defense through additional discovery.

9

Beri maintains that she herself was not mistaken about the

However, this does not defeat typicality.

Opp. at 21.

Plaintiff

United States District Court
For the Northern District of California

10

additional compensation amount.

11

they will be able to prove a unilateral mistake defense.

12

defense would not be unique to Plaintiff Beri; Defendants claim

13

that they will assert the mutual mistake defense against other

14

class members, though again they make this claim in a speculative

15

way.

16

term ambiguous, Defendants drafted the contract, so the ambiguous

17

term would be construed in favor of Plaintiff Beri and the other

18

class members.

19

Defendants have not argued that
This

Further, even if mutual mistake rendered the compensation

Thus, the Court finds that the interests of the named

20

Plaintiffs are reasonably co-extensive with the absent class

21

members and that the typicality requirement has been met.

22

4.

Adequacy

23

Rule 23(a)(4) establishes as a prerequisite for class

24

certification that “the representative parties will fairly and

25

adequately protect the interests of the class.”

26

23(a)(4).

27

they satisfy the adequacy requirement, and the Court finds that

28

Plaintiffs have met their burden on this prong.

Fed. R. Civ. P.

Defendants do not dispute Plaintiffs’ assertion that

22

1

C. Rule 23(b)(3) requirements

2

1.

Predominance

3

“The predominance inquiry of Rule 23(b)(3) asks whether

4

proposed classes are sufficiently cohesive to warrant adjudication

5

by representation.

6

common and individual issues.”

7

Overtime Pay Litig., 571 F.3d 953, 957 (9th Cir. 2009) (internal

8

quotation marks and citations omitted).

9

present a significant aspect of the case and they can be resolved

The focus is on the relationship between the
In re Wells Fargo Home Mortgage

“‘When common questions

United States District Court
For the Northern District of California

10

for all members of the class in a single adjudication, there is

11

clear justification for handling the dispute on a representative

12

rather than on an individual basis.’”

13

(quoting 7A Charles Alan Wright, Arthur R. Miller & Mary Kay Kane,

14

Federal Practice & Procedure § 1777 (2d ed. 1986)).

15

make “some prediction as to how specific issues will play out in

16

order to determine whether common or individual issues predominate

17

. . . .”

18

Litig., 522 F.3d 6, 20 (1st Cir. 2008) (citation and internal

19

quotation marks omitted).

Hanlon, 150 F.3d at 1022

A court must

In re New Motor Vehicles Canadian Export Antitrust

20

a. Breach of Contract (National Class)

21

To assert a cause of action for breach of contract, a

22

plaintiff must plead: (1) the existence of a contract; (2) the

23

plaintiff’s performance or excuse for non-performance; (3) the

24

defendant’s breach; and (4) damages to the plaintiff as a result

25

of the breach.

26

Co., 116 Cal. App. 4th 1375, 1391 n.6 (2004).

27
28

Armstrong Petrol. Corp. v. Tri-Valley Oil & Gas

Plaintiffs argue that common issues will predominate, because
the issue central to this claim is the interpretation of specific
23

1

provisions in a form contract applicable to all class members.

2

Plaintiffs’ breach of contract claim is premised on three separate

3

types of violations: (1) that Defendants deducted class members’

4

Indian salaries from their American salaries, even though the

5

contract stated that the American salary would be “in addition to”

6

the Indian salary; (2) that Defendants required class members to

7

sign over their tax refunds; and (3) that Defendants did not pay

8

class members the specific amount of additional United States

9

compensation that they were contractually obliged to pay.

United States District Court
For the Northern District of California

10

Defendants argue that individual issues would predominate in

11

determining their liability under the first type of violation,

12

because some class members authorized Defendants to deduct their

13

Indian wage from their gross wage.

14

deductions not otherwise authorized by state or federal law must

15

be “expressly authorized in writing by the employee.”

16

Code § 224.

17

such a deduction.

18

APDs in which they authorized the deduction of their Indian

19

salaries from their United States wages.

20

not demonstrate that individual issues will predominate for

21

several reasons.

22

formatting of the forms differ, the APDs are uniform in their

23

material terms and, thus, the determination of whether class

24

members who signed the APDs authorized the deduction of their

25

Indian salary from their United States salary can be made on a

26

class-wide basis.

Under California law, any

Cal. Lab.

Thus, Defendants must have written authorization of
Defendants argue that some class members signed

However, these APDs do

First, while the specific monetary amounts and

27

Second, contrary to Defendants’ contentions, neither the two

28

APDs produced by Defendants from within the class period, nor the
24

1

APDs from outside the class period that they proffered,

2

demonstrate that class members authorized this deduction.

3

Defendants argue that, because the APDs show that wages paid in

4

the United States are calculated by subtracting the Indian salary

5

from the deputed employee’s “Gross Wages,” the employees

6

authorized the deduction of their Indian salary from their United

7

States compensation amount.

8

However, Defendants’ conclusion conflates the total gross wages

9

and the gross wages paid in the United States and ignores that the

See, e.g., Defs.’ Suppl. Brief, at 6.

United States District Court
For the Northern District of California

10

contracts that they drafted use the word “gross” in multiple

11

contexts.

12

employee’s “Gross Wages” is the total of the “Wages paid in India”

13

and “Wages paid in the United States.”

14

the language in the form DTAs.

15

employees will receive, “in addition to the compensation and

16

benefits you currently receive and will continue to receive in

17

India,” an “additional compensation in the United States in the

18

gross amount of $ [blank], less deductions required by law or

19

otherwise voluntarily authorized by you.”

20

“Total Gross Compensation” is the aggregate of the “amounts of

21

salary paid by TCS in India” and “the additional compensation in

22

the United States.”

23

Indian salary from the total gross compensation in order to

24

calculate the United States compensation--just as the employees

25

authorized in the DTA--but do not authorize subtraction of the

26

Indian salary from the United States compensation, which is what

27

Plaintiffs allege that Defendants did.

28

Defendants may have contracted to pay class members a net salary

The APDs put in evidence show that the deputed

This is consistent with

The DTAs state that deputed

They also state that

The APDs thus authorize subtraction of the

25

Further, the fact that

1

that was calculated after specific mandatory and voluntary

2

deductions were withheld from the contracted-for gross salary does

3

not mean that Defendants could make additional deductions from the

4

gross salary beyond those which were specifically authorized, as

5

Defendants appear to argue.

6

Defendants also argue that individual issues predominate as

7

to the second type of violation, because “there is no uniform

8

policy or practice regarding tax refunds.”

9

Defendants claim that the Court would have to hold mini-trials to

Opp. at 24-25.

United States District Court
For the Northern District of California

10

determine whether each individual employee signed a tax refund

11

check over to Defendants in a given year.

12

Rule 30(b)(6) witness, Ramakrishnan Venkataraman, testified that,

13

during the class period, Defendants’ policy and practice was that

14

“when the tax refunds are received, they have been sent to the

15

employee with a request that the tax refunds are signed and sent

16

back to the company.”

17

He also agreed that Defendants’ “practice” was to mark “the back

18

of deputed employees’ tax refund checks with a stamp that read,

19

“Pay to the order of [Defendants].”

20

Defendants also do not dispute Plaintiffs’ evidence that one

21

hundred percent of the tax refund checks that Defendants produced

22

from the period relevant to the class, with a copy of the back of

23

the check, were stamped in this way.

24

Summ. J. Order, at 16 (noting that Defendants presented evidence

25

that their “Overseas Deputation Manual stated that employees on

26

deputation were required to sign over their income tax refund

27

checks to Defendants”).

28

“misconstrue” their policy, they do not explain how.

However, Defendants’

Hutchinson Decl. ¶ 7, Ex. E, Tr. 223:9-12.

Id. at 223:23-224:1.

Shaver Decl. ¶ 9.

See also

Although Defendants state that Plaintiffs

26

Instead,

1

Defendants argue that this policy was not always uniformly

2

applied, because, for example, some class members did not comply

3

with the policy--did not return the signed tax refund--or

4

sometimes Defendants did not receive a refund check for a class

5

member.

6

existence of their own acknowledged policy by asserting that

7

isolated employees failed to comply with it.

8

Buy Co., 2007 U.S. Dist. LEXIS 64224, at 29-30 (N.D. Cal.) (“Where

9

a plaintiff challenges a well-established company policy, a

Opp. at 25.

However, Defendants cannot disprove the

See Kurihara v. Best

United States District Court
For the Northern District of California

10

defendant cannot cite poor management to defend against class

11

certification.”).

12

the amount of damages, which “is invariably an individual question

13

and does not defeat class action treatment.”

14

524 F.2d 891, 905 (9th Cir. 1975) (citations omitted).

15

Further, these arguments primarily relate to

Blackie v. Barrack,

Defendants argue that individual issues will predominate as

16

to the third type of violation, because there is no form contract

17

in that there were variations in how the blank in the

18

“Compensation in the United States” section was or was not filled

19

in.

20

mean that individual inquiries will need to be conducted to

21

ascertain how much additional compensation Defendants had promised

22

to each class member in order to determine if Defendants breached

23

this obligation.

24

Defendants argue that these variations create ambiguity and

Defendants rely primarily on Sacred Heart Health Sys., Inc.

25

v. Humana Mil. Healthcare Serv., Inc., 601 F.3d 1159 (11th Cir.

26

2010).

27

in multiple contract clauses that were material to the dispute,

28

including at least thirty-three material variations of the payment

However, in that case, there were significant variations

27

1

clauses, which could not be adequately addressed through

2

sub-classes.

3

variation only in one material contract term.

4

term--the specific amount of additional compensation promised--

5

there is much less variation here than in Sacred Heart.

6

above, Defendants identify several variations in how this blank is

7

completed.

8

the DTAs were unambiguous and included a “reliable, intended, and

9

agreed compensation amount.”

Id. at 1171-76.

In contrast, here there is
Even for that

As stated

Defendants concede that a substantial percentage of

Opp. at 18.5

For these DTAs,

United States District Court
For the Northern District of California

10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

5

Defendants state at several points in their opposition that
fifty-nine percent of sample DTAs examined had ambiguous terms and
that forty-one percent had unambiguous terms, citing the
declaration of Dr. Siskin, which contains a summary of a sample of
194 DTAs executed between 2002 and 2005 that they produced to
Plaintiffs following a court order. In his summary, Dr. Siskin
created eight categories of DTAs, based on how the compensation
field was completed, and assigned each DTA to a category. Siskin
Decl. ¶ 14, Chart A; Siskin Suppl. Decl. Chart A. To calculate
the number of DTAs that Defendants concede have unambiguous
compensation terms, Dr. Siskin appears to have added up the number
of DTAs in four of his categories in which there was a figure in
the blank other than a typed $50,000, including three DTAs in
which $50,000 was written in by hand. Id. Dr. Siskin included in
this figure DTAs in which the number in the blank was followed by
a typed $50,000 in parentheses--($50,000)--which he describes as a
sample instruction on how to complete the field. Id. This
totaled eighty-two DTAs. Id.
In his supplemental declaration, Dr. Siskin corrected the
percentage obtained by dividing eighty-two by 194 from fifty-nine
percent to fifty-eight percent. Siskin Suppl. Decl. ¶ 3. He also
reassigned two DTAs to a different category and assigned eleven
DTAs to categories, which he stated he had previously been unable
to do. Id. at ¶¶ 5-8. He also stated that, if he limited his
analysis to the 143 DTAs he found to be executed within the class
period, he would characterize approximately twenty-nine percent of
the DTAs as unambiguous. Id. at ¶ 5.
28

1

extrinsic evidence of intent would be inadmissible, and thus gross

2

wages could be determined on a common basis, supporting a finding

3

of predominance.

4

For the remaining DTAs, Defendants argue that there is

5

ambiguity in the amount of compensation promised, which would

6

necessitate individualized inquiries into the intent of the

7

parties to ascertain the intended amount.

8

compensation fields completed in the following three manners:

9

(1) ______;6 (2) $50,000; (3) ______ ($50,000).

These DTAs have

Defendants also

United States District Court
For the Northern District of California

10

assert that this term is ambiguous for class members for whom DTAs

11

cannot be located.

12

with ambiguous compensation terms, individual extrinsic evidence

13

will be required to determine the parties’ intent and thus

14

individual issues would predominate.

15

Defendants contend that, for the class members

Extrinsic evidence is only admissible if contract terms are

16

ambiguous.

17

involves a two-step process.

18

App. 4th 1343, 1351 (2004).

Under California law, the interpretation of a contract
Wolf v. Superior Court, 114 Cal.
First, the court provisionally

19
20
21

In their analysis of the same sample, Plaintiffs calculated
that thirty-three percent of the 172 DTAs executed within the
class period had a compensation term other than $50,000 in the
relevant blank. Shaver Decl. ¶ 11.

22
23
24
25
26
27
28

Thus, the parties agree that approximately a third or more of
the DTAs contain an unambiguous additional compensation amount.
6

Dr. Siskin separates DTAs in which the fields are completed
in the following two ways: ______ and ______(______). See Siskin
Decl. ¶ 14, Chart A; Siskin Suppl. Decl. Chart A. In their
opposition brief, Defendants do not draw an analytical distinction
between these categories, and the Court finds none. Accordingly,
the Court considers these variations to be the same for the
purposes of its analysis.
29

1

receives all credible evidence concerning the parties’ intentions

2

to determine if there is an ambiguity.

3

v. G.W. Drayage & Rigging Co., Inc., 69 Cal. 2d 33, 39-40 (1968).

4

Thus, the court will examine the proffered evidence concerning the

5

parties’ intentions in order to determine whether the disputed

6

terms are ambiguous.

7

court determines the language of the contract is ambiguous, the

8

extrinsic evidence is admitted to aid in the second step:

9

interpreting the contract.

Id.; Pac. Gas & Elec. Co.

If, in light of the extrinsic evidence, the

Id.

However, as previously noted,

United States District Court
For the Northern District of California

10

where a form contract of adhesion is at issue, the court will,

11

wherever reasonable, interpret the agreement “as treating alike

12

all those similarly situated, without regard to their knowledge or

13

understanding of the standard terms of the writing” in order to

14

“effectuate the reasonable expectations of the average member of

15

the public who accepts it.”

16

at *7 (N.D. Cal.) (quoting Restatement (Second) of Contracts

17

§ 211(2) & Comment e).

Ewert v. eBay, Inc., 2010 WL 4269259,

18

Defendants argue that all contracts that fall into the second

19

and third category (approximately forty-two percent of the sampled

20

DTAs) are ambiguous, because the typed $50,000 is a sample amount,

21

not the amount that the parties intended as compensation.

22

Defendants do not proffer persuasive evidence that $50,000, when

23

typed, is a sample amount.

24

conclusory declaration.

25

Siskin demonstrate that he is an expert in contract interpretation

26

or in determining whether a particular contract term was a sample

27

or intended term.

28

methodology at all, let alone a reliable and valid one, that would

Defendants cite only Dr. Siskin’s

However, neither Defendants nor Dr.

Neither has offered evidence of any scientific

30

1

allow a statistician to determine that a compensation amount

2

entered on a contract did not accurately reflect what was promised

3

in that contract, even though it appeared there.

4

substantially reduced any persuasive force that his declaration

5

may have had by testifying in his deposition that, for a

6

particular DTA with which he was presented, he did not believe

7

$50,000 was a sample amount.

8

Tr. 103:3-9.

Dr. Siskin also

See Hutchinson Reply Decl., Ex. A,

Defendants also argue that some unknown fraction of contracts

10
United States District Court
For the Northern District of California

9

in the second and third category may be rendered ambiguous because

11

they may present evidence that class members signed other

12

documents stating a different compensation amount.

13

documents that Defendants allude to are APDs.

14

do not present evidence that the compensation amounts in the APDs

15

ever differed from those in the corresponding DTAs.

16

also argue that they may present evidence that some class members

17

did not believe that $50,000 was the correct amount of their

18

additional compensation, even though this was the only figure

19

shown in the DTA.

20

members’ visa petitions had a different compensation amount than

21

that on their DTAs and that certain class members testified that

22

they thought they would be compensated the amount in their visa

23

petitions.

24

individual issues will predominate for a variety of reasons.

25

First, Defendants do not offer credible evidence that the terms in

The only such

However, Defendants

Defendants

In support, Defendants assert that some class

However, this argument does not demonstrate that

26
27
28
31

1

the deponents’ visa petitions differed from those in their DTAs.7

2

Further, even if they did, the visa petitions were not contracts

3

between deputed employees and Defendants, but instead were sworn

4

petitions prepared and submitted by Defendants to the United

5

States government without the participation of the deputed

6

employee.

7

was a form adhesion contract, the understanding of the individual

8

class members of its terms is not relevant.

9

will effectuate the reasonable expectations that an employee would

United States District Court
For the Northern District of California

10
11

Additionally, as previously stated, given that the DTA

Instead, the Court

have of the meaning of the contract.
Further, as previously recognized, the Court will construe

12

ambiguous terms against Defendants, as the drafting parties.

13

Thus, if there were evidence of ambiguity in the DTAs in the

14

second and third categories, the Court must take into account that

15

Defendants drafted all the documents signed by the class members,

16

introduced any ambiguity into the documents, and were in a

17

superior bargaining position to the class members at the time that

18

the documents were signed.

19

Plaintiffs concede that there is ambiguity as to the

20

compensation term for the class members with DTAs that are

21

completely missing a number--less than fifteen percent of the

22
23
24
25
26
27
28

7

The Court accords little or no weight to Dr. Siskin’s
testimony comparing salaries on the visa petitions in a sample of
employment records to salaries on the DTAs in those records. Dr.
Siskin “matches” DTAs and visa petitions to one another based on
which of these documents is “closest in date,” as long they are
dated less than a year apart. Siskin Decl. ¶ 10. However, he
also acknowledges in his declaration that “the dates on the visa
petitions and DTAs are rarely the same,” and that many employees
have multiple visa petitions and DTAs. Id.
32

1

sample of DTAs produced, according to the data summaries prepared

2

by both parties--and for class members without an DTA that can be

3

currently located.

4

putative class falls into the latter category.

5

only to two specific sources of extrinsic proof, both documents

6

that contain some figure for the amount of gross salary: an APD,

7

which some class members signed, and the visa petitions, which

8

Defendants filed on behalf of each deputed employee.

9

23-24.8

It is not clear what percentage of the
Defendants point

Opp. at 9,

These are standard forms that are susceptible to proof on

United States District Court
For the Northern District of California

10

a class-wide basis as well.

11

2009 U.S. Dist. LEXIS 108768, at *37 (C.D. Cal.) (where the

12

extrinsic evidence relevant to interpreting an ambiguous contract

13

can be established on a class-wide basis, “it cannot be said that

14

individual issues predominate” as to the breach of contract

15

claim).

16

See Menagerie Prods. v. Citysearch,

Accordingly, the Court finds that Plaintiffs have met their

17

burden to demonstrate that issues for the breach of contract claim

18

common to the national class predominate over issues affecting

19

only individual members.
b. Wrongful Collection of Wages (Cal. Labor Code
§ 221) (California Class)

20
21

California Labor Code section 221 provides, “It shall be

22

unlawful for any employer to collect or receive from an employee

23

any part of wages theretofore paid by said employer to said

24
25
26
27
28

8

While Defendants point to deposition testimony as well,
they do so only to support that visa petitions may be an extrinsic
source of information about the intended amount of compensation.
Opp. at 24.
33

1

employee.”

2

labor performed by employees of every description, whether the

3

amount is fixed or ascertained by the standard of time, task,

4

piece, commission basis, or other method of calculation.’”

5

Prachasaisoradej v. Ralphs Grocery Co., Inc., 42 Cal. 4th 217, 226

6

(2007) (quoting Cal. Lab. Code § 200(a)).

7

adopted to prevent the use of secret deductions or ‘kickbacks’ to

8

make it appear the employer is paying a required or promised wage,

9

when in fact it is paying less.”

“‘Wages’ for this purpose ‘includes all amounts for

Section 221 “was

Prachasaisoradej, 42 Cal. 4th at

United States District Court
For the Northern District of California

10

231 (citing Kerr’s Catering Serv. v. Dep’t of Indus. Relations, 57

11

Cal. 2d 319, 328 (1962)).

12

violated section 221 in two ways: (1) by deducting their Indian

13

salary from their United States compensation and (2) by requiring

14

them to sign over their tax refund checks to Defendants.

15

Defendants’ arguments against predominance for Plaintiffs’ section

16

221 claim are already addressed above regarding breach of

17

contract.

18

Plaintiffs contend that Defendants

Many of

Defendants argue that Plaintiffs cannot prove the intended

19

compensation amount on a class-wide basis.

20

total compensation is not relevant to this claim, which simply

21

requires proof that Defendants deducted their Indian salary from

22

their United States salary, that Defendants required class members

23

to sign over their tax refund checks and that class members did

24

not give express authorization for these deductions.

25

Lab. Code § 224 (deductions not otherwise authorized by state or

26

federal law must be “expressly authorized in writing by the

27

employee”).

28
34

However, proof of

See Cal.

1

Defendants contend that some declarants signed APDs in which

2

they gave Defendants express authorization to take deductions from

3

their wages.

4

declarants did not expressly authorize Defendants to keep the

5

over-withheld tax deductions or to deduct their Indian salary from

6

their United States salary.

7

that individual issues will predominate.

8
9

United States District Court
For the Northern District of California

10
11
12

Opp. at 28.

While this may be true, these

Thus, the APDs do not provide proof

Accordingly, Plaintiffs have met the predominance requirement
for their section 221 claim predicated on unlawful collection of
tax refunds and deduction of Indian salary.
c. Failure to Provide Accurate Itemized Wage
Statements (Cal. Labor Code § 226(a))
(California Class)

13

California Labor Code section 226(a) mandates, in pertinent

14

part, “Every employer shall furnish each of his or her employees

15

. . . an accurate itemized statement in writing showing (1) gross

16

wages earned, . . . (4) all deductions, provided that all

17

deductions made on written orders of the employee may be

18

aggregated and shown as one item, (5) net wages earned . . . .”

19

Section 226(e) provides, “An employee suffering injury as a result

20

of a knowing and intentional failure by an employer to comply with

21

subdivision (a)” is entitled to certain statutory compensation for

22

each pay period in which the violation occurred and an award of

23

costs and attorneys’ fees.

24

Plaintiffs argue that Defendants violated section 226 by

25

(1) inaccurately reporting the number of tax exemptions for class

26

members; and (2) inaccurately reporting the gross and net incomes

27

of class members by failing to disclose class members’ payments to

28
35

1

the company in tax refund checks and the money that Defendants

2

deducted for class members’ Indian salary.9

3

Defendants contend that section 226 does not require them to

4

list tax exemptions on the wage statements.

5

reply, Plaintiffs do not contend that section 226 requires that

6

exemptions be accurately reported on wage statements, and instead

7

argue that “inaccurately reporting tax exemptions . . . resulted

8

in inaccurate deductions of Class members’ salary for federal and

9

state taxes,” which is a violation of section 226.

Opp. at 29.

In their

Reply, at 23.

United States District Court
For the Northern District of California

10

However, while Plaintiffs have alleged that Defendants commonly

11

changed class members’ exemptions, Plaintiffs have not submitted

12

proof that these changes were incorrect or resulted in inaccurate

13

withholding that was common to the California class.

14

primarily rely on the declaration of Anne Shaver, in which she

15

summarizes changes in exemptions found in a small number of sets

16

of earnings statements produced by Defendants.10

17

asserts that over half of the sets of earnings statements examined

18

show that there was a change of two or more in the number of

19

exemptions from month-to-month or year-to-year; however, Ms.

20

Shaver acknowledges that there is no evidence as to why these

21
22
23
24
25
26
27

Plaintiffs

Ms. Shaver

9

At the hearing, Plaintiffs’ counsel stated that this claim
was also premised on the failure to pay the full amount of
additional salary promised; however, this was not alleged in the
complaint or argued in the motion for class certification.
Accordingly, the Court does not reach this argument.
10

While Defendants produced 197 sets of monthly earning
statements, only thirty-three listed the number of exemptions and
thus Ms. Shaver’s summary is based on only those thirty-three sets
of earning statements. Shaver Decl. ¶ 10.

28
36

1

changes were made, that they were inaccurate, or that they were

2

made without authorization.

3

the class member declarations that Plaintiffs submit show that the

4

number of exemptions changed for only some class members, that it

5

changed in different ways, and that the change was sometimes

6

accurate and sometimes inaccurate.

7

plan also recognizes that these changes may have been proper in

8

individual cases.

9

Court finds that Plaintiffs have not established that common

Shaver Decl. ¶ 10 & n.2.

Further,

Plaintiffs’ proposed trial

Pls.’ Proposed Trial Plan, at 6.

Thus, the

United States District Court
For the Northern District of California

10

issues would predominate as to their section 226 claim based on

11

inaccurate reporting of the number of tax exemptions for class

12

members.

13

However, to the extent that Plaintiffs’ section 226 claim is

14

predicated on Defendants’ failure accurately to report gross and

15

net wages and deductions, by failing to reflect class members’

16

payments to the company in tax refund checks and the money that

17

Defendants deducted for Indian salaries, the predominance

18

requirement has been met.

19

through the same common proof as the breach of contract and

20

section 221 claims, addressed above.

21

wage statements accurately show the net pay to the class members;

22

however, the fact that wage statements showed the amount on the

23

pay checks is irrelevant to Plaintiffs’ arguments that Defendants

24

paid deputed employees an incorrect amount.

25

that Plaintiffs cannot show the proper gross compensation through

26

common proof; this is also irrelevant, because if Plaintiffs prove

27

that deputed employees were improperly required to pay Defendants

28

back their wages, the wage shown on the statements would be

Plaintiffs argue that this can be shown

37

Defendants respond that the

Defendants also argue

1

inaccurate regardless of amount.

2

Starbucks Corp., 192 Cal. App. 4th 1136, 1142-43 (2011),

3

Defendants argue that Plaintiffs “fail to demonstrate any injury

4

suffered by putative class members due to the allegedly inaccurate

5

wage statements.”

6

California Court of Appeal held that the mere omission of one of

7

the required terms, without an allegation that the information was

8

inaccurate, was insufficient to allege injury.

9

distinguished cases where the plaintiffs had “to engage in

Finally, relying on Price v.

However, Price is inapplicable; there, the

The court

United States District Court
For the Northern District of California

10

discovery and mathematical computations . . . to determine if they

11

were correctly paid.”

12

already rejected this argument.

13

(rejecting Defendants’ argument that “plaintiffs fail to allege

14

injury suffered as a result of defendants’ violation of section

15

226,” because “failure to provide accurate wage statements alone

16

has been held to be an injury to employees”).

17

Id. at 1143.

Further, the Court has

See Order on Mot. to Dismiss, 12

Accordingly, the Court finds that Plaintiffs have met their

18

burden to establish predominance for their section 226 claim

19

predicated on Defendants’ failure to account for class members’

20

payments to the company in tax refund checks or the Indian salary

21

deduction, but not for Defendants’ inaccurate reporting of the

22

number of tax exemptions.

23

d. Waiting Period Penalties (Cal. Labor Code
§§ 201-203) (California Class)

24

California Labor Code section 201(a) provides, “If an

25

employer discharges an employee, the wages earned and unpaid at

26

the time of discharge are due and payable immediately.”

27

California Labor Code section 203 provides that employees “not

28
38

1

having a written contract for a definite period of time” who quit

2

employment are entitled to payment of wages either at time of

3

quitting if they have given seventy-two hours previous notice or

4

within seventy-two hours thereafter if they have not given such

5

notice.

6

fails to pay . . . in accordance with Sections 201, 201.5, 202,

7

and 205.5, any wages of an employee who is discharged or quits,

8

the wages of the employee shall continue as a penalty from the due

9

date thereof at the same rate until paid or until an action

Section 203 further provides, “If an employer willfully

United States District Court
For the Northern District of California

10

therefor is commenced; but the wages shall not continue for more

11

than 30 days.”

12

Plaintiffs allege that Defendants have violated Labor Code

13

sections 201 through 203 by failing properly to compensate deputed

14

employees at the time of discharge for: (1) the Indian wages that

15

Defendants deducted from their United States wages; (2) the wages

16

that Defendants required deputed employees to sign over to them

17

through the tax refund checks; and (3) the amount of unpaid

18

additional compensation promised in the DTAs.

19

violations are predicated on the breach of contract and section

20

221 claims, Plaintiffs assert that common questions predominate

21

over individual questions for the same reasons.

22

Because these

In response, Defendants again argue that Plaintiffs cannot

23

establish the amount of compensation that class members were

24

promised through common proof.

25

not relevant to all of the theories of liability.

26

argue that common questions do not predominate, because Defendants

27

may be able to file counter-claims against some class members who

This is addressed above, and is

28
39

Defendants also

1

“absconded from TCS and did not fulfill their post-deputation

2

obligations.”

3

Opp. at 30.

However, “the existence of counterclaims . . . will not

4

usually bar a finding of predominance of common issues.”

5

Newberg § 4:26.

6

have not identified any actual putative class members who have

7

absconded and have not provided an estimate of how many class

8

members may have done so.

9

against most class members would be barred by the four year

2

Defendants have not filed any counter-claims,

As Plaintiffs point out, counter-claims

United States District Court
For the Northern District of California

10

statute of limitations.

11

support the proposition that mere speculation about possible

12

counter-claims will bar certification.

Defendants have not cited any cases to

13

Thus, Plaintiffs have satisfied their burden as to

14

predominance of common issues in their waiting period penalties

15

claim to the same extent as with the underlying violations.

16
17

e. UCL Claim (California Class)
California’s Unfair Competition Law (UCL) prohibits any

18

unlawful, unfair or fraudulent business act or practice.”

19

Bus. & Prof. Code § 17200.

20

treats violations of those laws as unlawful business practices

21

independently actionable under state law.

22

Omaha Life Ins. Co., 225 F.3d 1042, 1048 (9th Cir. 2000).

23

Violation of almost any federal, state or local law may serve as

24

the basis for a UCL claim.

25

App. 4th 832, 838-39 (1994).

26

Defendants’ alleged violations of California Labor Code § 221.

27

Thus, the predominance of common questions for this claim mirrors

28

that of the section 221 claim.

Cal.

The UCL incorporates other laws and

Chabner v. United of

Saunders v. Superior Court, 27 Cal.
Plaintiffs’ UCL claim is premised on

40

1
2

2.

Superiority

Defendants’ only argument that class action treatment is not

3

superior is that class members “who were deputed to the U.S. in

4

multiple years” would likely have claims worth “tens of thousands

5

of dollars” and, thus, class members have sufficient monetary

6

incentive to bring individual suits.

7

Defendants do not argue that all putative class members would have

8

what they characterize as “large” claims.

9

the record that some class members were deputed to the United

Opp. at 31.

Notably,

There is evidence in

United States District Court
For the Northern District of California

10

States for less than a year during the class period.

11

Gunalan Decl. ¶ 3 (deputed for less than a year of the class

12

period); Karmakar Decl. ¶¶ 3-4 (deputed for less than six months

13

of the class period); Malnedi Decl. ¶¶ 3 (deputed, over the course

14

of two deputations to the United States, for less than a year of

15

the class period).

16

Inst., Inc., 253 F.3d 1180 (9th Cir. 2001), found that the

17

superiority factor weighed against class certification when

18

damages suffered by each class member were large, in that case,

19

the court found that the damages for each class member exceeded

20

$50,000.

21

of the named Plaintiffs seeks under $25,000 in damages.

22

Smith v. Cardinal Logistics Mgmt. Corp., 2008 U.S. Dist. LEXIS

23

117047, at *32 (N.D. Cal.) (where “full recovery would result in

24

an average amount of damages of $25,000-$30,000 per year of work

25

for each class member” and “not all of the putative class members

26

worked for the entire class period of approximately five years,

27

the Court cannot conclude that the damages sought are large enough

28

to weigh against a class action”).

See, e.g.,

While the court in Zinser v. Accufix Research

Id. at 1190-91.

Here, Defendants acknowledge that one

41

See also

1

Further, Plaintiffs have argued that many class members fear

2

retaliation from Defendants if they file individual suits and that

3

many class members currently reside in India, which would pose

4

substantial barriers to bringing individual actions.

5

have not disputed these arguments.

6

Defendants

Thus, the Court finds that Plaintiffs have demonstrated that

7

class treatment is superior to litigating individual cases.

8

V.

9

United States District Court
For the Northern District of California

10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

Appointment of Class Counsel
Rule 23(g)(1) of the Federal Rules of Civil Procedure

provides in part:
Unless a statute provides otherwise, a court that certifies a
class must appoint class counsel. In appointing class
counsel, the court:
(A) must consider:
(i) the work counsel has done in identifying or
investigating potential claims in the action;
(ii) counsel’s experience in handling class
actions, other complex litigation, and the types of
claims asserted in the action;
(iii) counsel’s knowledge of the applicable law;
and
(iv) the resources that counsel will commit to
representing the class;
(B) may consider any other matter pertinent to counsel’s
ability to fairly and adequately represent the interests
of the class;
(C) may order potential class counsel to provide
information on any subject pertinent to the appointment
and to propose terms for attorney’s fees and nontaxable
costs;
(D) may include in the appointing order provisions about
the award of attorney’s fees or nontaxable costs under
Rule 23(h); and
(E) may make further orders in connection with the
appointment.
Fed. R. Civ. P. 23(g)(1).
Plaintiffs represent that their counsel, the law firms of
Rukin, Hyland, Doria & Tindall, LLP (RHDT) and Lieff, Cabraser,
42

1

Heimann & Bernstein, LLP (LCHB), have invested significant time

2

and resources to investigating and developing the legal claims in

3

this case thus far, that they are seasoned and experienced in

4

handling class actions of this nature, that they are knowledgeable

5

of the relevant law, and that they will continue to commit ample

6

resources to representing the class.

7

declarations and other evidence in support thereof.

8

Decl. ¶¶ 1-20 (describing his and RHDT’s experience litigating

9

class action employment matters, the efforts of Plaintiffs’

Plaintiffs have submitted
See Tindall

United States District Court
For the Northern District of California

10

counsel on behalf of the class thus far and their commitment to

11

continue to represent the class vigorously in the future); Dermody

12

Decl. ¶¶ 1-5 (describing her experience litigating class action

13

employment matters and providing a firm resume for LCHB).

14

Defendants do not oppose the appointment of their attorneys as

15

class counsel.

16
17

Accordingly, the Court GRANTS Plaintiffs’ motion for
appointment of their counsel as class counsel.

18

CONCLUSION

19

For the foregoing reasons, Plaintiffs’ motion for class

20

certification (Docket No. 185) is GRANTED IN PART and DENIED IN

21

PART.

22

“all non-U.S. citizens who were employed by Tata in the United

23

States at any time from February 14, 2002 through June 30, 2005

24

and who were deputed to the United States after January 1, 2002.”

25

This class may prosecute Plaintiffs’ breach of contract claims.

26

The Court certifies a California class, defined as “all non-U.S.

27

citizens who were employed by Tata in California at any time from

28

February 14, 2002 through June 30, 2005 and who were deputed to

The Court certifies a national class, defined as

43

1

California after January 1, 2002.”11

2

Plaintiffs’ claims for wrongful collection of wages, failure to

3

provide accurate itemized wage statements, waiting period

4

penalties and violation of the UCL, except to the extent that

5

Plaintiffs’ section 226 claim is based on the inaccurate reporting

6

of the number of tax exemptions.

7

of Lieff, Cabraser, Heimann & Bernstein, LLP and Rukin Hyland

8

Doria & Tindall LLP as class counsel.

This class may prosecute

The Court APPOINTS the law firms

The parties shall appear for a case management conference to

10
United States District Court
For the Northern District of California

9

set future deadlines in this case on Wednesday, April 25, 2012 at

11

2:00 p.m.

12

statement by April 18, 2012.

13

IT IS SO ORDERED.

The parties shall submit a joint case management

14
15

Dated: 4/2/2012

16

CLAUDIA WILKEN
United States District Judge

17
18
19
20
21
22
11

23
24
25
26
27
28

Plaintiffs have requested that the California class include
individuals employed by Tata through the date of judgment.
Because Defendants changed their policies regarding income tax
returns and deduction of the Indian salary from the United States
salary in July 2005, the Court limits the California class to
include only individuals who were employed by Tata through June
30, 2005. However, the class may pursue claims for waiting time
penalties that accrued after June 30, 2005 for failure to pay
wages that were earned before that date or that were improperly
deducted before that date.
44