On Wednesday, February 20, 2019, the United States Supreme Court held, in Timbs v. Indiana, that the Eighth Amendment’s ban on excessive fines applies to the states. You can find plenty of analysis about this decision out there as it applies to things like state asset forfeiture laws, so I won’t even try to duplicate all of that analysis here, But it occurs to me that we should expect to see this holding tossed into the mix in PAGA cases on the theory that a large PAGA penalty violates the Eighth Amendment. How well that works remains to be seen, since, just spitballing here, a large PAGA penalty is pretty much only going to arise when an employer has lots of employees and violates lots of wage and hour provisions lots of times. Of course, out at the fringe, this argument might have some traction. I’m sure we’ll see in the next few years.
A awesome opportunity came my way quite recently, and I can now announce that I am joining Moon & Yang, effective February 25, 2019, where I will be focusing exclusively on employment class actions. I received quite a vote of confidence from the partners, for which I am very grateful. With a surging employment practice, this is a chance to great things.
In Gilberg v. California Check Cashing Stores, LLC (9th Cir. Jan. 29, 2019), the Ninth Circuit confirmed that Syed v. M-I, LLC, 853 F.3d 492 (9th Cir. 2017) applied to any surplussge in employment background check disclosures required by the Fair Credit Reporting Act.
I did that. Weird flex, but okay.
Slip opinion available to download here.
I previously mentioned the surprising appellate court opinion in Huff v. Securitas Security Services USA (May 23, 2018). When it was issued, I was certain that review would be requested, and I would not have been surprised if review had been granted. However, I missed the fairly quick denial of review and depublication. That denial issued on August 8, 2018. Sorry I missed that; this is a noteworthy opinion.
As in full of pith. With a young attorney in my firm, Lilit Ter-Astvatsatryan, we wrote an opinion column for the Daily Journal, published on September 12, 2018 and entitled Unaccounted Time: Reading the tea leaves of Troester. Wait, something is wrong with that. If Lilit is a young attorney, then I am old. So let’s start again…
With a colleague at my firm, Lilit Ter-Astvatsatryan, we wrote an opinion column for the Daily Journal, published on September 12, 2018 and entitled Unaccounted Time: Reading the tea leaves of Troester. Much better.
I congratulate Lilit on her first foray into craven and shameless self-promotion.
For years I've heard grumbling about Civil Local Rule 23-3 of the United States District Court for the Central District of California. I may have been been responsible for some of that grumbling myself. If you haven't run into this rule, Local Rule 23-3 requires the filing of a class certification motion within 90 days of the commencement of the action. While many judges would accept stipulations to waive the rule, some did not. In ABS Entertainment Inc. v. CBS Corp. (9th Cir. Aug. 20, 2018), the Ninth Circuit finally addressed this Local Rule in a published opinion (I believe there was commentary in an unpublished opinion a number of years ago):
Central District of California Local Rule 23-3 sets a strict 90-day time frame from the filing of a complaint to the motion for class action certification. This bright line rule is in direct contrast to the flexibility of the Federal Rule, which calls for a determination on class certification “[a]t an early practicable time after a person sues or is sued as a class representative.” Fed. R. Civ. P. 23(c)(1)(A). That flexible approach makes sense. The class action determination can only be decided after the district court undertakes a “rigorous analysis” of the prerequisites for certification. Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 350–51 (2011) (quoting Gen. Tele. Co. of SW v. Falcon, 457 U.S. 147, 161 (1982)). To undertake that analysis may require discovery. Kamm v. Cal. City Dev. Co., 509 F.2d 205, 210 (9th Cir.1975) (“The propriety of a class action cannot be determined in some cases without discovery;” “To deny discovery in [such cases] would be an abuse of discretion.”).
The district court’s actions here demonstrate the impracticability of the 90-day limit, particularly in combination with the district court’s summary and unexplained denial of the parties’ joint stipulation to extend the 90-day deadline based on the need for pre-certification discovery. See Barbara J. Rothstein & Thomas E. Willging, Federal Judicial Center, Managing Class Action Litigation: A Pocket Guide for Judges 9 (3d ed. 2010) (“Considering [Fed. R. Civ. P. 23(c)(1)], you should feel free to ignore local rules calling for specific time limits; such local rules appear to be inconsistent with the federal rules and, as such, obsolete.”); Federal Judicial Center, Manual for Complex Litigation, Fourth § 21.133 (“Some local rules specify a short period within which the plaintiff must file a motion to certify a class action. Such rules, however, may be inconsistent with Rule 23(c)(1)(A)’s emphasis on the parties’ obligation to present the court with sufficient information to support an informed decision on certification. Parties need sufficient time to develop an adequate record.”).
Although the district court’s application and interpretation of its Local Rules is entitled to “a large measure of discretion,” Lance, Inc. v. Dewco Servs., Inc., 422 F.2d 778, 784 (9th Cir. 1970), Local Rules cannot be incompatible with Federal Rules. Fed. R. Civ. P. 83(a)(1). We conclude that the bright-line of Local Rule 23-3 is incompatible with Federal Rule of Civil Procedure 23.
Slip op., at 49-50. I only wonder whether the inclusion of this discussion at the end of a massive copyright opinion will give it more attention -- perhaps enough to lead to a repeal of Local Rule 23-3 entirely -- or less because it will get lost at the end of this unusually long opinion.
The California Supreme Court denied the Petition for Rehearing in Troester v. Starbucks, making a tiny change to the Opinion. Here is the change, which was made to the last paragraph:
We hold that the relevant California statutes and wage order have not incorporated the de minimis doctrine found in the FLSA. We further conclude that although California has a de minimis rule that is a background principle of state law, the rule is not applicable here. The relevant statutes and wage order do not allow employers **834 to require employees to routinely work for minutes off-the-clock without compensation. We leave open whether there are wage claims involving employee activities that are so irregular or brief in duration that it would not be reasonable to require employers to compensate employees for the time spent on them.
We hold that the relevant California statutes and wage order have not incorporated the de minimis doctrine found in the FLSA. We further conclude that although California has a de minimis rule that is a background principle of state law, the rule is not applicable to the regularly reoccurring activities that are principally at issue here. The relevant statutes and wage order do not allow employers to require employees to routinely work for minutes off the clock without compensation. We leave open whether there are wage claims involving employee activities that are so irregular or brief in duration that employers may not be reasonably required to compensate employees for the time spent on them.
So that makes this Opinion final final. Can't wait until its final final final. Or even final final final final.
Join us on Episode 19 for a lively discussion of potential implications from the recent Troester v. Starbucks decision from the California Supreme Court. Listen as I attempt to control the crowd cheering for me.
The California Supreme Court just posted Troester v. Starbucks (July 26, 2018), and it is a bomb blast. There is no federal de minimis defense to California wage and hour laws, and, on the facts of this case at least, no state de minimis defense either:
Upon a request by the United States Court of Appeals for the Ninth Circuit (Cal. Rules of Court, rule 8.548), we agreed to answer the following question: Does the federal Fair Labor Standards Act’s de minimis doctrine, as stated in Anderson v. Mt. Clemens Pottery Co. (1946) 328 U.S. 680, 692, and Lindow v. United States (9th Cir. 1984) 738 F.2d 1057, 1063, apply to claims for unpaid wages under California Labor Code sections 510, 1194, and 1197?
The de minimis doctrine is an application of the maxim de minimis non curat lex, which means “[t]he law does not concern itself with trifles.” (Black’s Law Dict. (10th ed. 2014) p. 524.) Federal courts have applied the doctrine in some circumstances to excuse the payment of wages for small amounts of otherwise compensable time upon a showing that the bits of time are administratively difficult to record.
We approach the question presented in two parts: First, have California’s wage and hour statutes or regulations adopted the de minimis doctrine found in the federal Fair Labor Standards Act (FLSA)? We conclude they have not. There is no indication in the text or history of the relevant statutes and Industrial Welfare Commission (IWC) wage orders of such adoption.
Second, does the de minimis principle, which has operated in California in various contexts, apply to wage and hour claims? In other words, although California has not adopted the federal de minimis doctrine, does some version of the doctrine nonetheless apply to wage and hour claims as a matter of state law? We hold that the relevant wage order and statutes do not permit application of the de minimis rule on the facts given to us by the Ninth Circuit, where the employer required the employee to work “off the clock” several minutes per shift. We do not decide whether there are circumstances where compensable time is so minute or irregular that it is unreasonable to expect the time to be recorded.
Slip op., at 1-2. "So minute or or irregular." Looks like even small amounts of time that can be recorded and occur regularly must be captured and paid.
I will be back in a few after I take a victory lap. Thanks to everyone who helped me to polish my briefing to a shine, including Kimberly Kralowec, among others.
H. Scott Leviant, Shaun Setareh, and Thomas Segal of Setareh Law Group, David Spivak of The Spivak Law Firm, Lous Benowitz of the Law Offices of Louis Benowitz, and Stanley D. Satlzman of Marlin & Saltzman represented the prevailing Plaintiff and Appellant.
Hot off the notification presses, the California Supreme Court will release its opinion in Troester v. Starbucks tomorrow, at about 10:00 a.m.
Wagers on whether California will adopt the Lindow rule for de minimis time? Comments?