Payne & Fears LLP offers a full range of business and litigation services to its clients in three primary practice groups: Labor and Employment, Business Litigation, and Insurance Coverage. Across these practice areas, we represent all types of clients, from multi-national corporations to emerging tech startups to individual insurance policyholders.
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Payne & Fears Secures Victory for Client - Court Rejects Common PAGA Abuses
On August 13, 2020, Payne & Fears attorneys secured a victory on behalf of Southern Counties Oil Co. in a published opinion from the California Court of Appeal, First District in the case, Robinson v. Southern Counties Oil Company.
Background
Richard Robinson worked as a truck driver for Southern Counties Oil Co. from February 4, 2015 through June 14, 2017. In August 2018, Robinson filed a complaint under the California Labor Code Private Attorneys General Act of 2004 (PAGA) § 2698 et seq., seeking penalties based on the allegation that Southern Counties Oil Co. denied meal and rest breaks to him and other aggrieved employees. Robinson did not allege individual claims.
In February 2019, the San Diego County Superior Court approved a settlement in a class action, Gutierrez v. Southern Counties Oil Co. (Gutierrez), that sought individual damages as well as civil penalties under PAGA for the same alleged Labor Code violations. Robinson and three other employees opted out of the Gutierrez settlement.
Following a demurrer, Robinson amended the complaint seeking to represent the three employees who opted out of the settlement in Gutierrez and persons who were employed by Southern Counties from January 27, 2018 to the present.
The court sustained without leave to amend a demurrer to the amended complaint, holding that Robinson is barred from bringing a PAGA action asserting the same claims that were settled in Gutierrez and that he lacks standing to bring a representative action on behalf of employees employed during the time period when he was no longer employed by Southern Counties Oil Co. Robinson appealed. The First Appellate District, Division Four, upheld the dismissal.
Significance for Employers
This week, the Court of Appeal made two significant holdings. First, the court held that under the claim preclusion doctrine, a plaintiff cannot bring a second PAGA action after the defendant resolves an identical PAGA action in another matter. The court reached this holding by recognizing this basic point: the Labor and Workforce Development Agency (LWDA) is always the real party in interest in a PAGA claim.
Second, the court held that a plaintiff does not have standing to serve as a PAGA representative for a time period during which he or she was not employed. “The preclusion of Robinson’s claims for the period during which he was employed by Southern County deprives him of standing to assert claims arising exclusively after he was so employed.” (Opinion, 7)
“This case may have a significant impact on future PAGA litigation because it addresses a common PAGA abuse head-on,” said Amy Patton, lead attorney for Southern Counties Oil Co. “Companies that see multiple PAGA claims covering the same time period may use this case to attack later-filed PAGA claims at the pleading stage. This would significantly reduce the settlement value of these lawsuits.”
The Southern Counties Oil Co. team consisted of Amy Patton, Raymond Nhan, and Sean O’Brien with significant contribution at the trial court from Matthew Lewis.
The case is A158791 in the Court of Appeal for the State of California First Appellate District, Division Four.
Labor and Employment Litigation
Amy R. Patton, Matthew C. Lewis, Raymond J. Nhan, Sean A. O’Brien
After a lengthy and contentious 2 ½-year court battle, Payne & Fears secured for its client a payment of $10,000 from a Plaintiff as part of a judgment in a case involving severe allegations of sexual harassment and retaliation. In the complaint, the Plaintiff alleged multiple instances of sexual harassment by a coworker over an eight-year period, and subsequent retaliation by the client’s human resources department. Throughout the case, however, the client consistently maintained that the coworker and the Plaintiff had been involved in a consensual 8-year relationship. Over the course of the heavily-litigated discovery phase, Payne & Fears obtained love letters, greeting cards, gifts, and corroborating testimony supporting the client’s version of the case. Payne & Fears also secured an expert analysis of the parties’ personal cell phones, which resulted in the recovery of several deleted text messages from Plaintiff confirming the existence of a consensual relationship, as well as unlawful surreptitious recordings of conversations that Plaintiff had made at work. After filing a cross-complaint for common law and statutory privacy violations based on the secret recordings, Payne & Fears won summary judgment on those claims, and secured a judgment for its client of $10,000 against Plaintiff.
Jeffrey K. Brown and Alejandro G. Ruiz were the attorneys on the case.
