Ahlstrom v. DHI Mortgage Company, LTD., L.P.

Filing 57

ORDER GRANTING [48, 50] MOTION TO SUBSTITUTE PARTY. Signed by Judge Beth Labson Freeman on 1/18/2023. (blflc2, COURT STAFF) (Filed on 1/18/2023)

Case 5:19-cv-03435-BLF Document 57 Filed 01/18/23 Page 1 of 4

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

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ROBERT W. AHLSTROM,
Plaintiff,

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Case No. 19-cv-03435-BLF
ORDER GRANTING PLAINTIFF’S
MOTION TO SUBSTITUTE

v.
DHI MORTGAGE COMPANY, LTD.,
L.P.,

[Re: ECF No. 50]

United States District Court
Northern District of California

Defendant.
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Plaintiff Robert W. Ahlstrom brought suit on behalf of himself and a putative class of

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others similarly situated against Defendants DHI Mortgage Company, Ltd. L.P. (“DHIM Ltd.”)

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and DOES 1 to 50 (collectively, “Defendants”) for state law wage and hour and contract

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violations. See generally ECF 1-1 (“Compl.”). On November 3, 2022, Plaintiff, through counsel,

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filed a motion notifying the Court that Named Plaintiff Robert W. Ahlstrom passed away and

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requesting to substitute the Estate of Robert W. Ahlstrom as Named Plaintiff. ECF No. 50, Ex. A

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(“Mot.”); see also ECF No. 54 (“Reply”). Defendant DHIM Ltd. (“Defendant”) opposes the

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motion. ECF No. 51 (“Opp.”). The Court finds the matter suitable for submission without oral

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argument and thus VACATES the hearing set for March 23, 2022 at 9:00 a.m. See Civ. L.R. 7-

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1(b). For the reasons explained below, the Court GRANTS the motion.

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Rule 25 addresses the death of a party: “If a party dies and the claim is not extinguished,

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the court may order substitution of the proper party. A motion for substitution may be made by

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any party or by the decedent's successor or representative. If the motion is not made within 90

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days after service of a statement noting the death, the action by or against the decedent must be

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dismissed.” Fed. R. Civ. P. 25(a)(1). “In deciding a motion to substitute under Rule 25(a)(1), a

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court must consider whether: (1) the motion is timely, (2) the claims pled are extinguished; and (3)

Case 5:19-cv-03435-BLF Document 57 Filed 01/18/23 Page 2 of 4

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the person being substituted is a proper party.” Veliz v. Cinta Corp., No. C 03-1180 RS, 2008 WL

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2811171, at *1 (N.D. Cal. July 17, 2008) (footnote omitted). “If Rule 25(a)(1) is met, ‘[t]he

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substituted party steps into the same position as [the] original party.’” Id. (quoting Hilao v. Estate

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of Marcos, 103 F.3d 762, 766 (9th Cir. 1996)).

United States District Court
Northern District of California

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Here, the Court finds that the motion satisfies the requirements of Rule 25(a). First, the

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motion is timely, as Plaintiff’s attorney filed a Suggestion of Death on October 13, 2022, and the

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motion to substitute was filed on November 3, 2022. See ECF No. 47; Mot. Second, the claims

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are not extinguished. “The question of whether an action survives the death of a party must be

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determined by looking towards the law, state or federal, under which the cause of action arose.”

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Stribling v. Lucero, No. 2:16-cv-01438-TLN-JDP, 2021 WL 516849, at *1 (E.D. Cal. Feb. 11,

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2021) (quoting Cont’l Assurance Co. v. Am. Bankshares Corp., 483 F. Supp. 175, 177 (E.D. Wis.

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1980)). “The test for survivorship hinges on whether the statutory provision is primarily penal in

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nature or remedial in nature.” Id. (citing Bracken v. Harris & Zide, L.L.P., 219 F.R.D. 481, 483

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(N.D. Cal. 2004)). Plaintiff brings five claims under the California Labor Code, one claim under

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California’s Unfair Competition Law, one claim under the Federal Labor Standards Act, and two

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California common law claims. See generally Compl. As argued by Plaintiff, these claims are all

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remedial in nature. The Court finds they are not extinguished. See Cal. Code Civ. Proc. §

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377.20(a) (“Except as otherwise provided by statute, a cause of action for or against a person is

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not lost by reason of the person’s death, but survives subject to the applicable limitations

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period.”); Veliz, 2008 WL 2811171, at *1 n.2 (stating there is “ample case law” that FLSA claims

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are not extinguished upon the plaintiff’s death). Defendant does not argue otherwise. See Opp.

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Third, the Estate is a proper party. “The rule defines the ‘proper party’ for substitution as

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either ‘the decedent's successor or representative.’” Gilmore v. Lockard, No. 1:12-cv-00925-

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NONE-SAB (PC), 2020 WL 3288417, at *2 (E.D. Cal. June 18, 2020). The Court must look to

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California law to determine a “proper party” for purposes of Rule 25(a)(1). See Chalfant v. United

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of Omaha Life Ins. Co., No. 15-cv-03577-HSG, 2016 WL 4539453, at *1 (N.D. Cal. Aug. 31,

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2016). California law defines “personal representative” as an “executor, administrator, . . .

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successor personal representative . . . or a person who performs substantially the same function
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United States District Court
Northern District of California

Case 5:19-cv-03435-BLF Document 57 Filed 01/18/23 Page 3 of 4

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under the law of another jurisdiction governing the person’s status.” Cal. Prob. Code § 58(a).

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California law defines “decedent’s successor in interest” as “the beneficiary of the decedent's

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estate or other successor in interest who succeeds to a cause of action or to a particular item of the

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property that is the subject of a cause of action.” Cal. Code Civ. Proc. § 377.11. And the term

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“beneficiary of the decedent’s estate” means a beneficiary named in a will or a beneficiary under

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California intestacy rules. Cal. Code Civ. Proc. § 377.10. Mr. Ahlstrom died without a will and

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was never married, and his surviving daughter, Kianna L. Ahlstrom, is the sole beneficiary of his

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estate. Declaration of Kianna L. Ahlstrom, ECF No. 48-1 ¶ 3. She is therefore the proper party

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for substitution. See Martinez v. Animal Health Int’l, No. 1:21-CV-00965-JLT-SKO, 2022 WL

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2791171, at *2 (E.D. Cal. July 15, 2022) (substituting surviving children under California law

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when decedent died intestate).

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Defendant’s main argument in opposition is that the Estate cannot be the representative for

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a class or collective action. See Opp. at 7-13. But these arguments are being made under Rule 23

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and, as noted by Plaintiff, are properly addressed on a motion for class certification. See Reply at

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1-4. Defendant next argues that it will be prejudiced by the substitution because it did not have

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the opportunity to conduct discovery as to Mr. Ahlstrom. See Opp. at 13-14. But in the case

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Defendant points to in support of its prejudice argument, the court granted the motion to substitute

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even though seven years had passed since the decedent’s death. See Gilmore, 2020 WL 3288417,

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at *3. The Court finds Defendant has not shown prejudice here. And finally, Defendant argues

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that the motion should be denied because there is no Estate and Ms. Ahlstrom has not been

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appointed personal representative. See Opp. at 14. But, for the reasons discussed above, Ms.

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Ahlstrom is the proper party for substitution under California law.

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Case 5:19-cv-03435-BLF Document 57 Filed 01/18/23 Page 4 of 4

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For the foregoing reasons, IT IS HEREBY ORDERED that Plaintiff’s motion to substitute

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the Estate of Robert W. Ahlstrom through Kianna Ahlstrom for Robert W. Ahlstrom is

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GRANTED. The Clerk SHALL substitute the Estate of Robert W. Ahlstrom through Kianna

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Ahlstrom as Plaintiff and class representative in place of Robert W. Ahlstrom.

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Dated: January 18, 2023
______________________________________
BETH LABSON FREEMAN
United States District Judge

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United States District Court
Northern District of California

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