Horton v. Neostrata Company Inc. et al

Filing 88

ORDER granting in part and denying in part 54 Motion to Dismiss for Failure to State a Claim; denying 62 Motion to Remand; granting in part and denying in part 74 Motion to Strike. The Court will permit 24 Seven Defendants twenty-one (21) days to amend its answer to cure the pleading defects pursuant to Federal Rule of Civil Procedure 15(a)(2) and in accordance with the remainder of this order. Signed by Judge Anthony J. Battaglia on 6/22/2017. (acc)

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1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA 8 9 10 11 12 13 CANDLE HORTON, KIMBERLEE WINSTON, and JEANETTE ZDANEK, individually and on behalf of themselves and others similarly situated, 16 17 18 19 ORDER: (1) DENYING PLAINTIFFS’ MOTION TO REMAND; (Doc. No. 62) Plaintiffs, 14 15 Case No.: 3:16-CV-02189-AJB-JLB v. (2) GRANTING IN PART AND DENYING IN PART DEFENDANT NEOSTRATA’S MOTION TO DISMISS OR ALTERNATIVELY TO STRIKE PORTIONS OF PLAINTIFFS’ THIRD AMENDED COMPLAINT; AND (Doc. No. 54) NEOSTRATA COMPANY INC., a Delaware corporation; 24 SEVEN EMPLOYMENT INC., a New York corporation, et. al., Defendants. 20 21 (3) GRANTING IN PART AND DENYING IN PART PLAINTIFFS’ MOTION TO STRIKE (Doc. No. 74) 22 23 24 25 26 27 28 Presently before the Court is Plaintiffs Candle Horton, Kimberlee Winston, and Jeanette Zdanek’s (collectively referred to as “Plaintiffs”) motion to remand and motion to 1 3:16-CV-02189-AJB-JLB 1 strike, and Defendant NeoStrata Company Inc.’s (“Defendant NeoStrata”) motion to 2 dismiss. Having reviewed the parties’ arguments and controlling legal authority, and 3 pursuant to Local Civil Rule 7.1.d.1, the Court finds the matters suitable for decision on 4 the papers and without oral argument. For the reasons set forth below, the Court DENIES 5 Plaintiffs’ motion to remand, (Doc. No. 62), GRANTS IN PART AND DENIES IN 6 PART Defendant NeoStrata’s motion to dismiss or alternatively, to strike portions of 7 Plaintiffs’ third amended complaint (“TAC”), (Doc. No. 54), and GRANTS IN PART 8 AND DENIES IN PART Plaintiffs’ motion to strike. (Doc. No. 74.) BACKGROUND1 9 10 As the Court is already well-versed as to the alleged facts in this case, for the sake 11 of brevity, the Court will only provide a brief summary of the events leading up to the 12 institution of this action. 13 Plaintiffs, on behalf of themselves and all class members, brings this suit against 14 Defendant NeoStrata and 24 Seven Defendants. (See generally Doc. No. 49.) 24 Seven 15 Defendants2 serves as a labor contractor for Defendant Neostrata and various other 16 companies.3 (Id. ¶ 36.) As a labor contractor, 24 Seven Defendants hired Plaintiffs and 17 other class members to sell Defendant Neostrata’s products at various retail locations in 18 California. (Id.) Defendant Neostrata’s main line of work is being the exclusive provider 19 20 21 22 23 24 25 26 27 28 1 The following facts are taken from the TAC and construed as true for the limited purpose of resolving the instant motion. See Brown v. Elec. Arts, Inc., 724 F.3d 1235, 1247 (9th Cir. 2013). 2 24 Seven Defendants includes 24 Seven LLC (24 Seven Inc.’s successor), 24 Seven Staffing LLC (24 Seven Staffing Inc.’s successor), 24 Seven Talent California LLC DBA 24 Seven Creative Solutions (24 Seven Talent California Inc.’s successor), 24 Seven Recruiting LLC (24 Seven Recruiting Inc.’s successor), and their President and CEO Gudas. (Doc. No. 49 ¶ 35.) Plaintiffs contend that they are considered one company for liability purposes based on a Notice and Acknowledgement of Pay Rate and Payday form that lists the foregoing 24 Seven Companies together as the employer of Plaintiff Winston. (Id.) 3 The Court notes that Plaintiffs also allege in their TAC that 24 Seven Defendants and Defendant Neostrata are partners and in a partnership agreement. (Id. ¶¶ 47–50.) 2 3:16-CV-02189-AJB-JLB 1 of “Exuviance” skin products. (Id. ¶ 45.) 2 In October of 2015, Plaintiff Horton received an unsolicited phone call, where she 3 was asked and accepted to join a sales team to sell “Exuviance” products as a Freelance 4 Beauty Advisor. (Id. ¶¶ 100–02.) Once hired, Plaintiff Horton was required to report to Mr. 5 Tim Dunn and Ms. Megan Banister.4 (Id. ¶ 105.) Plaintiff Horton’s responsibilities 6 included working at retail stores, malls, outlets, or boutique stores selling products. (Id. ¶¶ 7 93–94.) Plaintiff was informed that she would be paid $25.00 an hour regardless of the 8 number of sales made. (Id. ¶ 103.) 9 Similarly, in October of 2015, Plaintiff Winston began working for 24 Seven 10 Defendants before her employment with Defendant Neostrata began on May 16, 2014. (Id. 11 ¶¶ 107–08.) In November of 2015, Defendant Neostrata and 24 Seven Defendants 12 (collectively referred to as “Defendants”) also hired Plaintiff Zdanek. (Id. ¶ 111.) Similar 13 to Plaintiff Horton, both Plaintiffs Winston and Zdanek were paid hourly, reported directly 14 to Mr. Dunn or Ms. Bannister, and had duties identical to the other named Plaintiffs. (Id. 15 ¶¶ 109, 112–13.) As to all of the Plaintiffs, Defendant Neostrata via its managers, told 16 Plaintiffs where to report for work, when to report to work, how much they were going to 17 be paid per hour, and how long they were going to work. (Id. ¶ 122.) 18 Notably, Defendants also required Plaintiffs to regularly travel in their personal 19 vehicles to more than one establishment in the same workday without compensation for 20 their travel time. (Id. ¶ 137.) Plaintiffs allegedly questioned Defendants’ management 21 personnel if they would be reimbursed for their mileage or travel time, to which 22 management responded in the negative.5 (Id. ¶ 138.) 23 24 25 26 27 28 4 Tim Dunn is the key account manager for Defendant Neostrata, and Megan Bannister is the Skincare Specialist for Exuviance Skincare. (Doc. No. 49 at 113, 115.) 5 The Court notes that emails attached to Plaintiffs’ TAC demonstrates the opposite. For example, an email from Tim Dunn to Plaintiff Winston states that she was to invoice him for the three hours of travel she accrued. (Id. at 80.) Additionally, in a separate email, another employee asks Plaintiff Winston to clock an extra hour on her time sheet to cover her gas expenses. (Id. at 84.) 3 3:16-CV-02189-AJB-JLB 1 In sum, Plaintiffs allege that (1) they were required to work more than forty hours a 2 week; (2) Defendants failed to pay them for their intraday travel; (3) Defendants required 3 Plaintiffs to not accurately record their time worked; (4) 24 Seven Defendants required 4 Plaintiffs to work out of their home, use their personal computers, cell phones, and home 5 internet without reimbursement; (5) Defendants failed to permit Plaintiffs from taking all 6 meal and rest breaks required by law; and (6) 24 Seven Defendants failed to comply with 7 California Sick Pay laws by failing to indicate on their paystubs or in a separate writing the 8 number of sick pay hours Plaintiffs had accrued from the inception of their employment. 9 (Id. ¶¶ 140–41, 165–66, 172, 186.) 10 PROCEDURAL BACKGROUND 11 Plaintiff Horton first instituted this action in the Superior Court of California, San 12 Diego County on July 20, 2016. (Doc. No. 1-2 at 3.) The case was subsequently removed 13 to this Court on August 29, 2016. (Doc. No. 1.)6 On September 2, 2016, Defendant 14 Neostrata filed a motion to dismiss or strike portions of Plaintiff Horton’s complaint. (Doc. 15 No. 8.) On September 15, 2016, Plaintiff Horton filed her FAC. (Doc. No. 15.) On 16 September 29, 2016, Defendant NeoStrata filed a motion to dismiss or strike portions of 17 Plaintiff Horton’s FAC, (Doc. No. 19), which was granted on November 22, 2016. (Doc. 18 No. 30.) On December 12, 2016, Plaintiffs filed their second amended complaint. (Doc. 19 No. 36.) On December 20, 2016, Defendant Neostrata filed its second motion to dismiss, 20 (Doc. No. 38), which was granted on March 8, 2017. (Doc. No. 46.) 21 On March 30, 2017, Plaintiffs filed their TAC. (Doc. No. 49.) In their TAC, Plaintiffs 22 allege violations of (1) failure to pay state overtime wages; (2) failure to pay state 23 minimum/regular wages; (3) failure to make payments within the required time; (4) 24 violations of Labor Code § 201.3; (5) meal and rest break violations; (6) violation of Labor 25 Code § 226; (7) failure to maintain required records in violation of California Labor Code 26 27 28 6 Page numbers are in reference to the automatically generated CM/ECF page numbers and not the numbers listed on the original document. 4 3:16-CV-02189-AJB-JLB 1 §§ 1174; (8) failure to indemnify/ reimburse business expenses in violation of California 2 Labor Code § 2802; (9) remedies under the Private Attorney General Act (“PAGA”) 3 California Labor Code §§ 2698, 2699, et seq.; and (10) unfair business practices in 4 violation of California Business & Professional Code §§ 17000 and 17200 et seq. (Id.) In 5 response, Defendant Neostrata filed the present motion its motion to dismiss or 6 alternatively, to strike portions of Plaintiffs’ TAC on April 13, 2017. (Doc. No. 54.) 7 Subsequently, on May 2, 2017, Plaintiffs filed a motion to remand. (Doc. No. 62.) 8 On May 11, 2017, 24 Seven Defendants filed their amended answer to Plaintiffs’ TAC. 9 (Doc. No. 68.) In response, Plaintiffs filed a motion to strike 24 Seven Defendants’ 10 amended answer on May 31, 2017. (Doc. No. 74.) LEGAL STANDARD 11 12 A. 13 A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of a plaintiff’s 14 complaint. See Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). “[A] court may dismiss 15 a complaint as a matter of law for (1) lack of a cognizable legal theory or (2) insufficient 16 facts under a cognizable legal claim.” SmileCare Dental Grp. v. Delta Dental Plan of Cal., 17 88 F.3d 780, 783 (9th Cir. 1996) (internal quotation marks and citation omitted). However, 18 a complaint will survive a motion to dismiss if it contains “enough facts to state a claim to 19 relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). 20 In making this determination, a court reviews the contents of the complaint, accepting all 21 factual allegations as true, and drawing all reasonable inferences in favor of the nonmoving 22 party. See Cedars-Sinai Med. Ctr. v. Nat’l League of Postmasters of U.S., 497 F.3d 972, 23 975 (9th Cir. 2007). Motion to Dismiss 24 Notwithstanding this deference, the reviewing court need not accept legal 25 conclusions as true. See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). It is also improper for 26 a court to assume “the [plaintiff] can prove facts that [he or she] has not alleged.” 27 Associated Gen. Contractors of Cal., Inc. v. Cal. State Council of Carpenters, 459 U.S. 28 519, 526 (1983). However, “[w]hen there are well-pleaded factual allegations, a court 5 3:16-CV-02189-AJB-JLB 1 should assume their veracity and then determine whether they plausibly give rise to an 2 entitlement to relief.” Iqbal, 556 U.S. at 679. 3 B. 4 Under 28 U.S.C. § 1441, a defendant may remove a civil action from state court to 5 federal court as long as original jurisdiction would lie in the court to which the action is 6 removed. 28 U.S.C. § 1441(a); City of Chicago v. Int’l Coll. of Surgeons, 522 U.S. 156, 7 163 (1997). According to the ninth circuit, courts should “strictly construe the removal 8 statute against removal jurisdiction.” Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). 9 Any doubt as to the removability of an action should be resolved in favor of remanding the 10 Motion to Remand case to the state court. Id. 11 C. 12 Under Federal Rule of Civil Procedure 12(f), on its own or by motion, the Court 13 “may strike from a pleading an insufficient defense or any redundant, immaterial, 14 impertinent, or scandalous matter.” Fed. R. Civ. P. 12(f). The purpose of Rule 12(f) is to 15 “avoid the expenditure of time and money that must arise from litigating spurious issues 16 by dispensing with those issues prior to trial . . . .” Sidney–Vinstein v. A.H. Robins Co., 697 17 F.2d 880, 885 (9th Cir. 1983). The Court must view the pleadings in the light most 18 favorable to the non-moving party . . . .” Cal. Dept. of Toxic Substances Control v. Alco 19 Pac. Inc., 217 F. Supp. 2d 1028, 1033 (C.D. Cal. 2002). “Any doubt concerning the import 20 of the allegations to be stricken weighs in favor of denying the motion to strike.” In re Wal- 21 Mart Stores, Inc. Wage & Hour Litig., 505 F. Supp. 2d 609, 614 (N.D. Cal. 2007) (citation 22 omitted). Motion to Strike 23 DISCUSSION 24 A. 25 In the interests of judicial economy, the Court will first turn to Plaintiffs’ motion to 26 remand. Plaintiffs argue that 24 Seven Defendants have failed to meet their burden to show 27 that this case is subject to federal jurisdiction pursuant to the Class Action Fairness Act 28 (“CAFA”). (Doc. No. 62-1 at 2.) Specifically, Plaintiffs argue that 24 Seven Defendants Motion to Remand 6 3:16-CV-02189-AJB-JLB 1 have failed to make a strong showing that the number of class members exceeds 100 and 2 that the amount in controversy exceeds $5,000,000. (Id.) In opposition, Defendants argue 3 that Plaintiffs’ motion to remand fails as Plaintiffs offer no evidence to support their 4 challenge to 24 Seven Defendants’ amount in controversy. (Doc. No. 69 at 17–19; Doc. 5 No. 70 at 28–30.) 6 i. Plaintiffs’ Failure to Provide Evidence Challenging Jurisdiction 7 First, the Court will turn to both parties’ contentions that Plaintiffs have failed to 8 submit proof illustrating whether the amount in controversy has been satisfied. (Doc. No. 9 69 at 17–19; Doc. No. 70 at 28–30.) Plaintiffs retort that the Ninth Circuit has long held 10 that the burden in showing whether the amount in controversy requirement is met in CAFA 11 is on the removing defendant. (Doc. No. 62-1 at 7; Doc. No. 71 at 7.) 12 Case law leaves little doubt that Plaintiffs are wholeheartedly mistaken in arguing 13 that they have no burden at this juncture. Plaintiffs are correct that the Ninth Circuit in 14 Ibarra v. Manheim Inv., Inc., 775 F.3d 1193 (9th Cir. 2015), held that “the defendant 15 seeking removal bears the burden to show by a preponderance of the evidence that the 16 aggregate amount in controversy exceeds $5 million when federal jurisdiction is 17 challenged.” Id. at 1197. However, the Ninth Circuit in Ibarra also stated that if the 18 “defendant’s assertion of the amount in controversy is challenged by plaintiffs in a motion 19 to remand, the Supreme Court has said that both sides submit proof and the court then 20 decides where the preponderance lies.” Id. at 1198 (emphasis added). See e.g., Dart 21 Cherokee v. Basin Operating Co., LLC v. Owens, 135 S. Ct. 547, 554 (2014) (same). 22 Based on the foregoing, the Court finds that Plaintiffs have failed to satisfy their 23 burden. The only proof Plaintiffs have provided to the Court is contained in their reply 24 brief, which succinctly states in two sentences that nowhere in their complaint do they 25 allege that the total damages for the entire case exceeds $5,000,000. (Doc. No. 71 at 7.) 26 This brief analysis fails to present a competing calculation or analysis of their potential 27 28 7 3:16-CV-02189-AJB-JLB 1 damages. Accordingly, as Plaintiffs have failed to satisfy their burden, their motion to 2 remand is DENIED. 7 Defendant Neostrata’s Motion to Dismiss or in the Alternative to Strike 3 B. 4 Defendant Neostrata requests that this Court either dismiss or strike portions of 5 Plaintiffs’ TAC. (See generally Doc. No. 54.) Specifically, Defendant Neostrata moves the 6 Court to strike (1) references to section 2810.3 from Plaintiffs’ fifth cause of action; (2) 7 paragraph 260 of the TAC; (3) references to Labor Code section 223 and 225.5; (4) 8 references to alleged meal and rest period violations from Plaintiffs’ UCL claim; and (5) 9 Plaintiffs’ class allegations. (Doc. No. 54-1 at 18–28.) Additionally, Defendant Neostrata 10 moves to dismiss Plaintiffs’ meal and rest period claims. (Id. at 19–21.) 11 i. Judicial Notice 12 As an initial matter, Defendant Neostrata requests in its reply brief that the Court 13 take judicial notice of Horton v. Socket Payment Services, a class action complaint filed in 14 California Superior Court by Plaintiff Horton, its subsequent first and second amended 15 class complaints, and a copy of the civil minutes for the Order re: Defendant Rite Aid 16 Corporation’s Motion for Partial Judgment on the Pleadings and Motion to Exclude Claim 17 for Waiting Time Penalties from the Pre-Trial Order in Marine Bargas v. Rite Aide Corp. 18 (Doc. No. 67-1 at 1–2.) Defendant Neostrata contends that the documents they request 19 judicial notice of confirm that it is Plaintiff Horton and her counsel’s operation to file wage- 20 hour class action complaints. (Doc. No. 67 at 6.) 21 22 23 24 25 26 27 28 Based on Plaintiffs’ failure to satisfy their burden, the Court will not analyze 24 Seven Defendants’ additional contentions that Plaintiffs’ complaint concedes the numerosity requirement, that the removal declaration and 24 Seven Defendant’s answer do not destroy CAFA jurisdiction, and that 24 Seven Defendants have established the CAFA requirements, (Doc. No. 69 at 11–23,) or Defendant Neostrata’s assertions that Plaintiffs are judicially estopped from challenging jurisdiction, and that 24 Seven Defendants have provided evidence demonstrating that the amount in controversy far exceeds $5,000,000. (Doc. No. 70 at 14–31.) 7 8 3:16-CV-02189-AJB-JLB 1 Despite the fact that courts “may take notice of proceedings in other courts . . . if 2 those proceedings have a direct relation to the matters at issue,” U.S. ex rel. Robinson 3 Rancheria Citizens Council v. Borneo, Inc., 971 F.2d 244, 248 (9th Cir. 1992), the Court 4 notes that this request for judicial notice was presented for the first time in Defendant 5 Neostrata’s reply brief. Thus, Plaintiffs were not granted the chance to reply in writing. 6 Accordingly, as the Court finds it unfair for Defendant Neostrata to save this request until 7 its reply brief, the Court DENIES Defendant Neostrata’s request for judicial notice. Hsu 8 v. Puma Biotechnology, Inc., 213 F. Supp. 3d 1275, 1284 (C.D. Cal. 2016). 9 ii. Leave to Add Meal or Rest Period Claims 10 Next, the Court turns to a procedural matter. Defendant Neostrata contends that 11 Plaintiffs’ TAC, which asserts new meal and rest period claims, should be dismissed for 12 failure to comply with the Court’s orders. (Doc. No. 54-1 at 17.) For the following reasons, 13 the Court concludes that these amendments are proper. 14 Federal Rule of Civil Procedure (“FRCP”) 15(a) states that a party may amend a 15 pleading once as a matter of course. Fed. R. Civ. P. 15(a). Rule 15(a) further provides that 16 the Court should “freely give leave when justice so requires.” Id. at (a)(2). This policy 17 regarding leave to amend is to be applied with “extreme liberality.” Morongo Band of 18 Mission Indians v. Rose, 893 F.2d 1074, 1079 (9th Cir. 1990). 19 Here, the Court granted Plaintiffs leave to file a third amended complaint “curing 20 the deficiencies herein.” (Doc. No. 46 at 12.) Thus, Plaintiffs were granted leave to amend 21 their pleading by leave of court. Furthermore, while the Court did specify that Plaintiffs 22 were to address the deficiencies in their second amended complaint, the Court did not place 23 any limitations on the types of amendments that could be made. Additionally, FRCP 18(a) 24 allows a party to assert “as many claims as it has against an opposing party.” Fed. R. Civ. 25 P. 18(a). Accordingly, the addition of Plaintiffs’ new meal and rest period claims are 26 proper. See Grier v. Brown, 230 F. Supp. 2d 1108, 1111–12 (N.D. Cal 2002) (holding that 27 the addition of two new defendants and a new state law cause of action was consistent with 28 9 3:16-CV-02189-AJB-JLB 1 the FRCP and Rule 15(a) as the court placed “no limitations” on the types of amendments 2 to be made). 3 4 iii. Motion to Dismiss a. Meal Period Claims against Neostrata 5 Defendant Neostrata makes two arguments in support of its motion to dismiss 6 Plaintiffs’ meal period claims. First, it asserts that it is not a joint employer with 24 Seven 7 Defendants under the common law. (Doc. No. 54-1 at 19.) Second, it contends that even if 8 it is a joint employer that Plaintiffs have failed to set forth separate factual allegations as 9 to each of the Defendants. (Id. at 19–20.) Plaintiffs retort that their TAC clearly puts 10 Defendant Neostrata on notice that it was the employer that gave Plaintiffs strict 11 assignment schedules about which they now complain. (Doc. No. 58 at 8.) 12 “[T]he standards to determine whether [d]efendants are directly liable [as joint 13 employers] are set out in Martinez v. Combs, 49 Cal. 4th 35 (2010), where the California 14 Supreme Court held that the definition of ‘employer’ for minimum wage purposes is 15 provided in the orders of California’s Industrial Welfare Commission (“IWC”).” Johnson 16 v. Serenity Transp., Inc., 141 F. Supp. 3d 974, 994 (N.D. Cal. 2015). The IWC Wage Order 17 provides three alternative definitions for the term “to employ.” Id. It means (1) to exercise 18 control over the wages, hours, or working conditions, or (2) to suffer or permit to work, or 19 (3) to engage, thereby creating a common law employment relationship. Id. 20 Taking Plaintiffs’ allegations as true, the Court finds that Plaintiffs have alleged 21 sufficient facts to contend that Defendant Neostrata is a joint employer with 24 Seven 22 Defendants under the common law. Plaintiffs plead that both Defendants recruit and 23 supervise Plaintiffs, that they implemented several different policies regarding conditions 24 of employment, they both paid Plaintiffs under a compensation plan and policy, and that 25 they retained and exercised the right to terminate Plaintiffs and the putative class members. 26 (Doc. No. 49 ¶¶ 62–67, 95–96.) Based on the foregoing, Plaintiffs’ allegations establishes 27 the plausibility that Defendant Neostrata is a joint employer with 24 Seven Defendants. 28 See Hibbs-Rines v. Seagate Techs., LLC, No. C 08-05430 SI, 2009 WL 513496, at *5 (N.D. 10 3:16-CV-02189-AJB-JLB 1 Cal. Mar. 2, 2009) (“While [the] plaintiff is not required to conclusively establish that 2 defendants were her joint employers at the pleading stage, [the] plaintiff must at least allege 3 some facts in support of this legal conclusion.” (citation omitted)). 4 Next, as currently pled, the Court finds that Plaintiffs have adequately alleged 5 specific facts that explain how each Defendant violated Plaintiffs’ meal period claims. 6 Defendant Neostrata contends that Plaintiffs’ allegation that Plaintiff Winston “had just 7 enough travel time allocated to her to allow her to report to the next assignments, which 8 precluded her from taking an uninterrupted 30-minute meal break,” (Doc. No. 49 ¶ 175), 9 fails to specify which Defendants imposed such strict work assignments. However, the 10 Court finds that though this sentence does not specifically identify one of the Defendants, 11 the Court need only look to the preceding paragraphs in the TAC to see that Plaintiffs plead 12 that both Defendant Neostrata and 24 Seven Defendants implemented and enforced 13 policies that failed to permit Plaintiffs from taking all of their off-duty breaks. (Id. ¶ 172.) 14 Logically, as these sentences are all placed under the same section titled “Meal and Rest 15 Break Violations,” the Court finds that Plaintiffs’ TAC is sufficient to put each Defendant 16 on notice that their alleged procedures failed to consider the rights of Plaintiffs to enjoy an 17 uninterrupted meal break. Based on the foregoing, Defendant Neostrata’s motion to dismiss 18 this claim is DENIED. 19 b. Rest Period Claims 8 20 Defendant Neostrata claims that Plaintiffs have failed to identify a single day when 21 it did not authorize or permit Plaintiffs to take a rest period. (Doc. No. 54-1 at 21.) Plaintiffs 22 retort that the allegations as pled in the TAC, read together, present a plausible claim for 23 rest break violations. (Doc. No. 58 at 10–12.) 24 25 26 27 28 Section 226.7 states that “[a]n employer shall not require an employee to work during a meal or rest or recovery period mandated pursuant to an applicable statute, or applicable regulation, standard, or order of the Industrial Welfare commission . . . .” Cal. Lab. Code § 226.7(b). 8 11 3:16-CV-02189-AJB-JLB 1 Plaintiffs’ rest break claim turns largely on Defendants’ policies. (Doc. No. 49 ¶ 2 173.) For example, Plaintiffs suggest that Defendants required them to be available by 3 phone for calls, texts, or email, and requested that Plaintiffs keep such devices on even 4 during rest periods. (Id. ¶ 177.) Due to this, Plaintiffs contend that they were prevented 5 from taking all of their uninterrupted rest breaks. (Id.) Moreover, Plaintiffs allege that as 6 they often worked alone, taking a meal or rest break was at times impracticable as they had 7 products on display that they could not leave unattended. (Id. ¶ 178.) 8 Based on these allegations, the Court finds that Plaintiffs have adequately pled why 9 and how they were scheduled in a way that prevented them from taking proper rest breaks. 10 Accordingly, Defendant Neostrata’s motion to dismiss Plaintiffs’ rest claim is DENIED. 11 See Varsam v. Laboratory Corp of Am., 120 F. Supp. 3d 1173, 1178 (S.D. Cal. 2015) 12 (“[C]ourts have held that if an employer makes it difficult for employees to take a break or 13 undermines a formal policy of providing meal and rest periods, there are sufficient grounds 14 to find a violation of the California Labor Code.”). 15 iv. Defendant Neostrata’s Motions to Strike 16 As stated supra p. 6, a court may grant a motion to strike if the contested language 17 constitutes an “insufficient defense or any redundant, immaterial, impertinent, or 18 scandalous matter.” Fed. R. Civ. P. 12(f). Additionally, the Court notes that “[w]hile a Rule 19 12(f) motion provides the means to excise improper materials from pleadings, such motions 20 are generally disfavored because the motions may be used as delaying tactics and because 21 of the strong policy favoring resolution on the merits.” Barnes v. AT&T Pension Benefit 22 Plan-Nonbargained Program, 718 F. Supp. 2d 1167, 1170 (N.D. Cal. 2010). Keeping this 23 policy in mind, the Court now turns to Defendant Neostrata’s motions to strike portions of 24 Plaintiffs’ TAC. 25 26 a. Labor Code § 2810.3 Does not Support Meal and Rest Period Claims 27 Defendant Neostrata asserts that as the labor contractor statute limits a client 28 employer to only sharing civil liability for the payment of wages, that Plaintiff cannot use 12 3:16-CV-02189-AJB-JLB 1 section 2810.3 for meal and period claims.9 (Doc. No. 54-1 at 18.) Plaintiffs retort that 2 Defendant Neostrata has failed to satisfy the three elements in order to strike under Rule 3 12(f) and has not shown that the TAC’s language alleging meal and rest period claims are 4 “prejudicial.” (Doc. No. 58 at 7.) 5 Under Labor Code § 2810.3, “[a] client employer shall share with a labor contractor 6 all civil legal responsibility and civil liability for all workers supplied by that labor 7 contractor for . . . the payment of wages.” Cal. Lab. Code § 2810.3(b)(1) (emphasis added). 8 Importantly, the Court first notes that it rejects the Rule 12(f) standard Plaintiffs use 9 in their opposition brief. Plaintiffs contend that for Defendant Neostrata to successfully 10 argue its motion to strike under Rule 12(f) that it needs to demonstrate that (1) no evidence 11 in support of the contested allegations would be admissible at trial; (2) the allegations have 12 no bearing on the relevant issues in the case; and (3) denying the motion to strike would 13 prejudice the moving party. (Doc. No. 58 at 7.) The Court finds that neither the FRCP nor 14 applicable case law support this standard. Moreover the cases Plaintiffs cite to support this 15 argument fail to set forth such a test with those three elements. 16 Second, it is clear that section 2810.3 cannot support meal and rest period claims. 17 Section 2810.3 specifically states that it is a claim for payment of wages. Cal. Lab. Code § 18 2810.3(b)(1) (emphasis added). In comparison “a section 226.7 claim is not an action 19 brought for nonpayment of wages; it is an action brought for nonprovision of meal or rest 20 breaks.” Kirby v. Immoos Fire Protection, Inc., 53 Cal. 4th 1244, 1257 (2012) (emphasis 21 added). Moreover, Plaintiffs readily concede in their opposition that Defendant Neostrata 22 “correctly notes that Plaintiffs’ Labor Code § 2810.3 allegations in Plaintiffs’ meal and rest 23 period claims are not directly relevant to their meal and rest period claims because such 24 claims are not for the recovery of ‘wages’ under Labor Code § 2810.3.” (Doc. No. 58 at 25 7.) Thus, finding section 2810.3 “immaterial” in that is has “no essential” relationship to 26 27 28 9 Plaintiffs bring their meal period claim under Labor Code section 226.7. (Doc. No. 54-1 at 18.) 13 3:16-CV-02189-AJB-JLB 1 the meal and rest period claims, and concluding that Defendant Neostrata would be 2 prejudiced from having to litigate a meritless cause of action, the Court GRANTS 3 Defendant Neostrata’s motion to strike from Plaintiffs’ fifth cause of action any references 4 to section 2810.3. Whittlestone, Inc. v. Handi-Craft Co., 618 F.3d 970, 974 (9th Cir. 2010) 5 (citation omitted). 6 b. Waiting Time Penalties Based Upon Alleged Meal and Rest Violations 7 Defendant Neostrata asserts that Plaintiffs cannot bring a claim for waiting time 8 penalties based upon alleged meal and rest period violations under section 226.7. (Doc. 9 No. 54-1 at 22.) In opposition, Plaintiffs contend that Defendant Neostrata has 10 misconstrued Plaintiffs’ TAC and that they are not bringing waiting time penalty claims 11 for meal and rest break violations. (Doc. No. 58 at 12.) 12 As currently pled, the Court agrees with Plaintiffs. Defendant Neostrata chooses to 13 direct its focus on Plaintiffs’ statement that they “incorporate by reference the foregoing 14 allegations.” (Doc. No. 54-1 at 22.) However, looking to the third cause of action for 15 waiting time penalties, the Court finds that the paragraphs following paragraph 260 clearly 16 state that Plaintiffs are alleging failure to pay timely earned wages during employment and 17 upon separation of employment in violation of California Labor Code §§ 201, 202, 203, 18 218.5, and 218.6. (Id. at 47.) Furthermore, paragraph 260 through 274 makes no reference 19 to section 226.7. The Court notes that it is cognizant of Defendant Neostrata’s argument 20 that the “incorporate by reference” sentence may be confusing as it incorporates the 21 preceding paragraphs that include meal and rest period allegations in paragraphs 172 22 through 178. (Doc. No. 67 at 9.) However, Defendant Neostrata fails to read the third cause 23 of action as a whole. Based on the foregoing, Defendant Neostrata’s motion to strike 24 paragraph 260 is DENIED. 25 /// 26 /// 27 /// 28 /// 14 3:16-CV-02189-AJB-JLB 1 c. Labor Code Sections 223 and 225.5 2 Defendant Neostrata requests that Labor Code sections 223 and 225.5 be stricken10 3 as Plaintiffs have failed to allege facts that Defendant Neostrata “secretly” paid lower 4 wages. (Doc. No. 54-1 at 23.) Plaintiffs contend that their TAC adequately pleads a section 5 223 and 225.5 claim. (Doc. No. 58 at 12–15.) 6 Section 223 states that “[w]here any statute or contract requires an employer to 7 maintain the designated wage scale, it shall be unlawful to secretly pay a lower wage scale 8 while purporting to pay the wage designated by statute or by contract.” Cal. Lab. Code § 9 223 (emphasis added). Section 223 was “enacted to address the problem of employers 10 taking secret deductions or ‘kickbacks’ from their employees.” Amaral v. Cintas Corp. No. 11 2, 163 Cal. App. 4th 1157, 1205 (2008) (citation omitted). Thus, in cases where a section 12 223 claim is properly pled, the “employer nominally pays employees the wage required by 13 a statute or collective bargaining agreement but then secretly deducts amounts or requires 14 employees to pay back a portion of the wages . . . .” Id. See, e.g., Sublett v. Henry’s Turk 15 and Taylor Lunch, 21 Cal. 2d 273, 274 (1942) (holding that plaintiff’s obligation to return 16 part of their compensation to their employer was a “kickback” scheme to defeat payment 17 of union wages); Shalz v. Union School Dist., 58 Cal. App. 2d 599, 601–02 (1943) (finding 18 violation of section 223 by contractor that agreed to pay prevailing wages but took large 19 deductions, ostensibly for employees’ lodging). 20 Plaintiffs cite to Johnson v. Q.E.D. Envtl. Sys. Inc., Case No. 16-cv-01454-WHO, 21 2016 WL 4658963, at *4 (N.D. Cal. Sep. 7, 2016), to contend that required off-the-clock 22 work is sufficient to state a claim under section 223. (Doc. No. 58 at 14.) The Court finds 23 24 25 26 27 28 10 Plaintiffs allege that this motion to strike is untimely as references to section 223 were made in their second amended complaint. (Doc. No. 58 at 12–13.) Thus, Plaintiffs request the Court, within its discretion, deny Defendant Neostrata’s late-filed motion to strike. (Id.) In the interests of judicial economy, and finding that the case cited by Plaintiffs does not support this proposition, the Court disagrees with Plaintiffs and will analyze Defendant Neostrata’s motion to strike this claim. 15 3:16-CV-02189-AJB-JLB 1 Johnson inapposite to the present matter. In Johnson, the court held that plaintiff’s claims 2 that defendants’ policy of “automatically deducting one half hour from employees’ 3 timecards for every work day for a meal period, even on those occasions that a full 30 4 minute break was not taken . . .” was sufficient to plead a section 223 claim. Id (emphasis 5 added). Here, Plaintiffs’ TAC is lacking any allegations to suggest that Defendants 6 automatically deducted amounts from their wages. Moreover, Plaintiffs do not plead that 7 Defendants took back previously paid wages or maintained a secret wage scale. In sum, 8 finding Plaintiffs’ section 223 claim inadequately pled, the Court chooses to DISMISS 9 instead of strike Plaintiffs’ section 223 claim.11 See Colaprico v. Sun Microsystems, Inc., 10 758 F. Supp. 1335, 1339 (N.D. Cal. 1991) (“[M]otions to strike should not be granted 11 unless it is clear that the matter to be stricken could have no possible bearing on the subject 12 matter of the litigation.”). 13 Moreover, as Plaintiffs’ section 225.5 claim makes available penalties for persons 14 who violate section 212, 216, 221, 222, or 223, this claim is also inadequately pled as 15 Plaintiffs do not allege violation of sections 212, 216, 221, or 222. Accordingly, Plaintiffs’ 16 section 225.5 claim is also DISMISSED. 17 d. Meal and Rest Period Violations Within Plaintiffs’ UCL Claim 18 Defendant Neostrata argues that Plaintiffs’ UCL claim should be stricken as a UCL 19 claim cannot be based on alleged meal and rest period violations. (Doc. No. 54-1 at 24– 20 27.) Plaintiffs assert that there is no clear answer from the Ninth Circuit or the California 21 Supreme Court as to whether Plaintiffs can recover section 226.7 premium pay as “wages” 22 under the UCL. (Doc. No. 58 at 15.) Both parties have cited district court cases that support 23 their respective positions. 24 25 26 27 28 11 Plaintiffs request leave to amend their section 223 claims as they contend that this is the first time it has been pled. (Doc. No. 58 at 14.) However, the Court notes that Plaintiffs clearly state in their opposition brief that references to Labor Code section 223 were made in Plaintiffs’ second amended complaint. (Id. at 12.) Thus, this request for leave to amend is meritless. 16 3:16-CV-02189-AJB-JLB 1 Despite the split in circuit authority, the Court will follow the holding of several 2 central district of California cases,12 as well as a case from this district and find that an 3 award under Section 226.7 is restitutionary and may be recovered under the UCL. The 4 Court finds this holding consistent with the Labor Code’s definition of “wages,” which is 5 “all amounts for labor performed by employees . . . .” Cal. Labor Code § 200(a). Under 6 section 226.7, the employee is paid an amount equal to one hour of regular pay for labor 7 performed during his meal break or rest period. Moreover, though “section 226.7 payment 8 . . . compensates the employee for events other than time spent working,” the payments 9 remain compensatory. Murphy v. Kenneth Cole Prods., Inc., 40 Cal. 4th 1094, 1113 (2007). 10 As such, they are properly characterized as restitutionary. Pena v. Taylor Farms Pac., Inc., 11 No. 2:13-CV-01282-KJM-AC, 2014 WL 1665231, at *10 (E.D. Cal. Apr. 23, 2104). 12 Accordingly, Plaintiffs may pursue their meal and rest period violations within their UCL 13 claim and Defendant Neostrata’s motion to strike is DENIED. Dittmar v. Costco 14 Wholesale Corp., CASE No. 14cv1156-LAB (JLB), 2016 WL 3387464, at *3 (S.D. Cal. 15 June 20, 2016) (holding that plaintiff’s UCL claim based on defendant’s failure to provide 16 timely meal breaks could proceed). 17 e. Plaintiffs’ Proposed Class 18 Defendant Neostrata contends that Plaintiffs’ proposed class should be dismissed or 19 stricken for having an unascertainable definition. (Doc. No. 54-1 at 27.) Plaintiffs retort 20 that Defendant Neostrata’s motion to strike their class claims is premature. (Doc. No. 58 21 at 18–19.) 22 While the Court appreciates the ample briefing provided by both parties on this issue, 23 the Court agrees with Plaintiffs and finds Defendant Neostrata’s motion to strike Plaintiffs’ 24 25 26 27 28 12 In Tomlinson v. Indymac Bank, F.S.B., 359 F. Supp. 2d 891 (C.D. Cal. 2005), the court held that while the matter is not clearly settled, that meal and rest break pay is recoverable under section 17200 as “payments under Section 226.7 are restitutionary because they are akin to payment of overtime wages to an employee: [B]oth are ‘earned wages’ and thus recoverable under the UCL.” Id. at 896 17 3:16-CV-02189-AJB-JLB 1 class allegation to be premature. Generally, courts review class allegations through a 2 motion for class certification. See Moreno v. Baca, No. CV007149ABCCWX, 2000 WL 3 33356835, at *2 (C.D. Cal. Oct. 13, 2000) (finding defendants’ motion to strike the class 4 allegation as premature because no motion for class certification was before the court); see 5 also In re NVIDIA GPU Litig., No. C 08-04312 JW, 2009 WL 4020104, at *13 (N.D. Cal. 6 Nov. 19, 2009) (“A determination of the ascertainability and manageability of the putative 7 class in light of the class allegations is best addressed at the class certification stage of 8 litigation.”). Accordingly, at this point in the litigation, the Court is not prepared to rule on 9 the propriety of Plaintiffs’ class allegations. Consequently, Defendant Neostrata’s motion 10 to strike or in the alternative motion to dismiss the class allegations is DENIED, but 11 WITHOUT PREJUDICE as to Defendant Neostrata’s ability to move to strike or dismiss 12 the class allegations if and when class certification is sought.13 Plaintiffs’ Motion to Strike 13 C. 14 Plaintiffs move to strike all twenty-two of Defendant Neostrata’s affirmative 15 defenses. (Doc. No. 74-1.) In opposition, 24 Seven Defendants contend that Plaintiffs have 16 failed to satisfy the high burden that accompanies motions to strike. (Doc. No. 83 at 6.) 17 i. Striking of “Insufficient” Affirmative Defenses 18 Plaintiffs assert that all twenty-two of the affirmative defenses that 24 Seven 19 Defendants have pled in its answer to the TAC are insufficient as they fail to give Plaintiffs 20 fair notice and/or because they fail as a matter of law. (Doc. No. 74-1 at 6.) 21 An affirmative defense may be insufficient as a matter of pleading or as a matter of 22 law. Sec. People, Inc. v. Classic Woodworking, LLC, No. C-04-3133 MMC, 2005 WL 23 645592, at *2 (N.D. Cal. Mar. 4, 2005). “The key to determining the sufficiency of pleading 24 25 26 27 28 Based on the foregoing, the Court will not address Defendant Neostrata’s arguments that Plaintiffs’ PAGA representative action is based on fail-safe definitions and should thus be dismissed. (Doc. No. 54-1 at 29 (see Kamar v. RadioShack Corp., 375 Fed. App’x 734, 735 (9th Cir. 2010) (where the defendant asserted a “fail-safe” argument after the court had already certified the class)).) 13 18 3:16-CV-02189-AJB-JLB 1 an affirmative defense is whether it gives the plaintiff fair notice of the defense.” Wyshak 2 v. City Nat’l Bank, 607 F.2d 824, 827 (9th Cir. 1979). Fair notice generally requires that 3 the defendant articulate the affirmative defense clearly enough that the plaintiff is “not a 4 victim of unfair surprise.” Bd. Of Trustees of San Diego Elec. Pension Trust v. Bigley Elec., 5 Inc., No. 07-cv-634-IEG (LSP), 2007 WL 2070355, at *2 (S.D. Cal. July 12, 2007) (citation 6 omitted). On a final note, despite district courts being split over the issue of what standard 7 to evaluate affirmative defenses, this Court will follow the Ninth Circuit and review the 8 sufficiency of 24 Seven Defendants’ affirmative defenses under the “fair notice” pleading 9 standard. Roe v. City of San Diego, 289 F.R.D. 604, 609 (S.D. Mar. 5, 2013). 10 Here, 24 Seven Defendants have not alleged sufficient facts to provide notice to 11 Plaintiffs as to the nature of its second, fourth, ninth, twelfth, thirteenth, fourteenth, and 12 fifteenth affirmative defenses. Specifically, in none of these seven affirmative defenses 13 does 24 Seven Defendants point to the existence of some identifiable fact that if applicable 14 to Plaintiffs or another class member would make the affirmative defense plausible on its 15 face. Instead, 24 Seven Defendants “simply lists a series of conclusory statements asserting 16 the existence of an affirmative defense without stating a reason why that affirmative 17 defense might exist.” Barnes, 718 F. Supp. 2d at 1172. 18 Accordingly, the Court GRANTS Plaintiffs’ motion to strike 24 Seven Defendants’ 19 second (statute of limitations), fourth (waiver), ninth (offset), twelfth (accord and 20 satisfaction/release), thirteenth (privilege/legitimate business reasons), fourteenth (no 21 knowledge, authorization, or ratification), and fifteenth (Labor Code § 2856) affirmative 22 defenses. 23 ii. Affirmative Defenses Adequately Pled 24 As to 24 Seven Defendants’ third (estoppel), fifth (laches), tenth (ratification), 25 eleventh (de minimis), and seventeenth (avoidable consequences) affirmative defenses, the 26 Court finds them adequately pled as they give Plaintiffs fair notice of the defense and they 27 are all supported by a valid factual basis. Specifically, 24 Seven Defendants state the nature 28 and grounds for the affirmative defense in such a way that it gives Plaintiffs fair notice of 19 3:16-CV-02189-AJB-JLB 1 what the defense may entail. Accordingly, based on this, as well taking into account the 2 disfavored status of motions to strike, the Court DENIES Plaintiffs’ motions to strike the 3 foregoing affirmative defenses. Barnes, 718 F. Supp. 2d at 1170 (“While a Rule 12(f) 4 motion provides the means to excise improper materials from pleadings, such motions are 5 generally disfavored because the motions may be used as delaying tactics and because of 6 the strong policy favoring resolution on the merits.”). 7 iii. Striking of Non-Affirmative Defenses 8 Though Plaintiffs do not argue this contention, the Court finds it appropriate to strike 9 several other affirmative defenses pled by 24 Seven Defendants finding that they are non- 10 affirmative defenses. Accordingly, the Court GRANTS Plaintiffs’ motion to strike 24 11 Seven Defendants’ seventh affirmative defense (no standing), see ABC Distributing, Inc. 12 v. Living Essentials LLC, Case No. 15-cv-02064 NC, 2016 WL 8114206, at *2 (N.D. Cal. 13 Apr. 26, 2016) (holding that lack of standing is not an affirmative defense), eighth 14 affirmative defense (excessive penalties unconstitutional), see J&J Sports Prods., Inc. v. 15 Ramirez Bernal, No. 1:12-cv-01512-AWI-SMS, 2014 WL 2042120, at *6 (E.D. Cal. May 16 16, 2014) (granting motion to strike affirmative defense of excessive damages because it 17 merely countered the allegations in the complaint regarding damages, and thus needed to 18 be pled in the “relevant section of the answer”), sixteenth affirmative defense (res judicata 19 and collateral estoppel), see Vargas v. Cnty. of Yolo, No. 2:15-CV-02537-TLN-CKD, 2016 20 WL 3916329, at *9 (E.D. Cal. July 20, 2016) (striking the affirmative defenses for 21 collateral estoppel and res judicata as the related case had not yet reached a final 22 judgment),14 and twentieth affirmative defense (good faith dispute), see Gomez v. J. Jacobo 23 Farm Labor Contractor, Inc., 188 F. Supp. 3d 986, 1001 (E.D. Cal. 2016) (“There is no 24 good faith mistake of law defense under the California Labor Code.”). 25 26 27 28 14 The Court notes that 24 Seven Defendants do not plead that there is any prior or present legal proceeding that will affect Plaintiffs’ claims in the present matter. (Doc. No. 68 at 57.) 20 3:16-CV-02189-AJB-JLB 1 iv. Defenses that Do Not Need Further Factual Support at this Juncture 2 As to 24 Seven Defendants’ sixth (unclean hands), eighteenth (failure to mitigate), 3 nineteenth (contribution by Plaintiffs’ own acts), and twenty-first (willfulness) affirmative 4 defenses, the Court finds that these defenses can survive the motion to strike as 24 Seven 5 Defendants do not need to plead substantial supporting facts to support the defenses at this 6 time. For example, several courts have held that “where discovery has barely begun, the 7 failure to mitigate defense is sufficiently pled without additional facts.” Ganley v. Cnty. of 8 San Mateo, No. C06-3923 THE, 2007 WL 902551, at *6 (N.D. Cal. Mar. 22, 2007) 9 (citation omitted). The Court finds that this same analysis applies to the sixth, nineteenth, 10 and twenty-first affirmative defenses. Thus, as the discovery cut-off date is set for February 11 6, 2018, (Doc. No. 85 at 2), the Court cannot say at this juncture that other facts may not 12 come to light later down the road. Thus, Plaintiffs’ motion to strike 24 Seven Defendants’ 13 sixth, eighteenth, nineteenth, and twenty-first affirmative defenses is DENIED. 14 iv. First Affirmative Defense: No Employment Relationship 15 24 Seven Defendants’ first affirmative defense alleges that they did not employ 16 Plaintiffs. (Doc. No. 68 at 53.) Plaintiffs allege that this affirmative defense contradicts 24 17 Seven Defendants’ removal papers that stated that it was Plaintiffs’ employers. (Doc. No. 18 74-1 at 7.) Thus, under the doctrine of judicial estoppel, Plaintiffs contend that 24 Seven 19 Defendants are precluded from changing their position through submission of an 20 inconsistent and contradictory pleading. (Id.) 21 The Court finds that “there is nothing in the Federal Rules of Civil Procedure to 22 prevent a party from filing successive pleadings that make inconsistent or even 23 contradictory allegations. Unless there is a showing that the party acted in bad faith . . . 24 inconsistent allegations are simply not a basis for striking the pleading.” See PAE Gov’t 25 Servs., Inc. v. MPRI, Inc., 514 F.3d 856, 860 (9th Cir. 2007). Accordingly, finding no bad 26 faith on the part of 24 Seven Defendants, the Court DENIES Plaintiffs’ motion to strike 27 24 Seven Defendants’ first affirmative defense. 28 /// 21 3:16-CV-02189-AJB-JLB 1 v. Twenty-Second Affirmative Defense: Pending Discovery 2 Plaintiffs contend that “pending discovery” is not an affirmative defense. (Doc. No. 3 74-1 at 18.) In their opposition brief, 24 Seven Defendants withdrew this defense as they 4 agreed that it is not a valid affirmative defense. (Doc. No. 83 at 15.) Accordingly, Plaintiffs’ 5 motion to strike 24 Seven Defendants’ twenty-second affirmative defense is DENIED as 6 MOOT. CONCLUSION 7 8 For the reasons set forth above, the Court ORDERS as follows: 9 (1) Plaintiffs’ motion to remand is DENIED; 10 (2) Defendant Neostrata’s motion to dismiss Plaintiffs’ meal and rest period claims 11 is DENIED; 12 (3) Any references to section 2810.3 in Plaintiffs’ fifth cause of action is 13 STRICKEN; 14 (4) Defendant Neostrata’s motion to strike paragraph 260 and references to alleged 15 meal and rest period violations in Plaintiffs’ UCL claim is DENIED; 16 (5) Plaintiffs’ section 223 and 225.5 claims are DISMISSED; 17 (6) Defendant Neostrata’s motion to dismiss Plaintiffs’ class allegations is 18 DENIED WITHOUT PREJUDICE; 19 20 21 22 23 24 (7) Plaintiffs’ motion to strike 24 Seven Defendants’ second (statute of limitations), fourth (waiver), seventh (no standing), eighth (excessive penalties unconstitutional), ninth (offset), twelfth (accord and satisfaction/release), thirteenth (privilege/legitimate business reasons), fourteenth (no knowledge, authorization, or ratification), fifteenth (Labor Code § 2856), sixteenth (res judicata & collateral estoppel), and twentieth (good faith dispute) affirmative defenses is GRANTED; and 25 (8) Plaintiffs’ motion to strike 24 Seven Defendants’ first (no employment 26 relationship), third (estoppel), fifth (laches), sixth (unclean hands), tenth 27 (ratification), eleventh (de minimis), seventeenth (avoidable consequences), 28 eighteenth (failure to mitigate), nineteenth (contribution by Plaintiffs’ own acts), 22 3:16-CV-02189-AJB-JLB 1 twenty-first (willfulness), and twenty-second (pending discovery) affirmative 2 defenses is DENIED. 3 The Court will permit 24 Seven Defendants twenty-one (21) days to amend its answer to 4 cure the pleading defects pursuant to Federal Rule of Civil Procedure 15(a)(2) and in 5 accordance with the remainder of this order. 6 On a final note, Plaintiffs request that this Court allow them one additional chance 7 to amend their complaint. However, finding that this is Plaintiffs’ third amended complaint, 8 the Court within its discretion finds it unsuitable for Plaintiffs to file a fourth amended 9 complaint. See Ascon Prop., Inc. v. Mobil Oil Co., 866 F.2d 1149, 1160 (9th Cir. 1989) 10 (“The district court’s discretion to deny leave to amend is particularly broad where plaintiff 11 12 13 14 15 16 has previously amended the complaint.”). Moreover, the Court notes that the scheduling order set by Magistrate Judge Jill Burkhardt states that the deadline to file any motion to amend the pleadings is set for June 30, 2017. (Doc. No. 85 at 1.) Accordingly, the Court DENIES Plaintiffs’ request for leave to file a fourth amended complaint. See Dutciuc v. Meritage Homes of Arizona, Inc., 462 Fed. App’x 658, 660 (9th Cir. 2011) (finding that the district court acted within its discretion in dismissing plaintiff’s TAC without leave to amend). 17 18 IT IS SO ORDERED. 19 Dated: June 22, 2017 20 21 22 23 24 25 26 27 28 23 3:16-CV-02189-AJB-JLB

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