Hargrove v. Legacy Healthcare, Inc.

• Decision Date: 09 June 2022
• Docket Number: E076240
• Citation: 80 Cal.App.5th 782,295 Cal.Rptr.3d 819
• Parties: Stephanie HARGROVE, Plaintiff, v. LEGACY HEALTHCARE, INC., et al., Defendants and Respondents; Makiya Cornell, Movant and Appellant.
• Court: California Court of Appeals Court of Appeals

80 Cal.App.5th 782

295 Cal.Rptr.3d 819

Stephanie HARGROVE, Plaintiff,

v. LEGACY HEALTHCARE, INC., et al., Defendants and Respondents;Makiya Cornell, Movant and Appellant.

E076240

Court of Appeal, Fourth District, Division 2, California.

Filed June 9, 2022

Capstone Law, Ryan H. Wu, Liana Carter and Bevin Allen Pike, Los Angeles, for Movant and Appellant.

Klinedinst, Greg A. Garbacz, Nadia P. Bermudez and Robert M. Shaughnessy, San Diego, for Defendants and Respondents.

No appearance for Plaintiff Stephanie Hargrove.

OPINION

McKINSTER, Acting P. J.

In 2016, plaintiff Stephanie Hargrove initiated this action against defendants and respondents San Bernardino Convalescent Operations, Inc., dba Legacy Post-Acute Rehabilitation Center (Hargrove's former employer; SBCO), Indio Nursing & Rehabilitation Center, Inc. (another skilled nursing facility where Hargrove was never employed; INRC), and Legacy Healthcare, Inc. (managerial and support services corp.; Legacy) under the Labor Code Private Attorneys General Act of 2004 ( Lab. Code,¹ § 2698 et seq. ; PAGA).² Approximately four years later, in 2020, Hargrove died. Her attorneys requested leave to file an amended pleading to substitute movant and appellant Makiya Cornell in place of Hargrove to prosecute the PAGA claims; however, on October 6, 2020, the trial court denied the request, dismissed the action, and stated that Cornell "is free to file her own claim and her own causes of action."

On appeal, Cornell contends that she has standing to appeal the trial court's order denying her request to substitute herself in place of Hargrove as an order effectively denying a motion to intervene. Alternatively, Cornell argues that this court may treat her appeal as a petition for writ of mandate. Assuming we conclude that Cornell has standing to appeal, she contends the trial court abused its discretion in refusing to permit her to amend Hargrove's complaint to substitute Cornell as the representative plaintiff such that her PAGA claim relates back to the original complaint.

We conclude that, strictly speaking, Cornell does not have standing to appeal the judgment; however, we treat the order denying the motion to amend as an order denying an implicit motion to intervene, and conclude the trial court did not abuse its discretion in denying the motion. Thus, we affirm.

I. PROCEDURAL BACKGROUND AND FACTS

From approximately August 2014 to August 2015, Hargrove worked at SBCO as a nonexempt, hourly paid restorative nursing assistant (RNA)/certified nursing assistant (CNA). On August 3, 2016, her counsel provided written notice to the California Labor and Workforce Development Agency (LWDA) that her employer, Legacy, allegedly failed to: (1) pay all, and at the correct rate, overtime wages; (2) provide adequate break coverage; (3) provide uninterrupted meal periods; (4) keep and provide true, accurate, and complete employment records, time records, and wage statements; (5) reimburse for the costs of uniforms; and (6) provide basic information material to employees' employment relationship. Hargrove sought remedies for these Labor Code violations for herself, the State of California, and all other aggrieved employees, and she wished to proceed with PAGA claims as authorized by " Labor Code sections 2699(a), 2699.3(a) and 2699.3(c), 2699.5, and 558."

Hargrove initiated this PAGA action in October 2016 against Legacy. She later amended her complaint in March 2017 to identify doe defendant SBCO, and again in August 2018 to identify doe defendant INRC. During the discovery phase, she passed away on February 27, 2020. Upon hearing of her death, the trial court ordered briefing on how it would impact the action going forward and scheduled an order to show cause hearing (OSC) as to why the case should not be dismissed.

In response to the OSC, Hargrove's counsel identified Cornell as a new PAGA representative who was willing to replace Hargrove as the named plaintiff after complying with her own notice and exhaustion requirements. Cornell had worked at SBCO as a nonexempt, hourly paid licensed vocational nurse (LVN) from approximately May 2019 to August 2019. On May 13, 2020, she sent PAGA letters to both LWDA and defendants.

A hearing on the OSC was held on August 21, 2020; the trial court expressed concern regarding the request to substitute Cornell in place of Hargrove because it "would result in a different time period for the PAGA claim, which would date off of [Cornell's] notice." Following a brief discussion, the court decided that instead of dismissing the action, it would allow the parties to fully brief the legal issues by way of a motion for leave to file a second amended complaint adding Cornell as the new plaintiff/representative. Hargrove's counsel filed such motion on September 15, 2020. Defendants opposed the motion on the grounds a PAGA action may not be assigned, Cornell's employment with defendants was four years after Hargrove was no longer employed, there is no deputized, authorized person to pursue the PAGA claim concerning the events from 2014 to 2018, and the relation-back doctrine does not apply. On October 6, 2020, the trial court agreed with defendants, denied the motion to amend, and dismissed the entire action. On October 14, Cornell initiated her own PAGA action against defendants.³ Judgment was entered on October 29, 2020. Hargrove's counsel filed a notice of appeal on behalf of "Proposed Plaintiff Makiya Cornell."

II. DISCUSSION

"The Legislature enacted [PAGA] for the ‘sole purpose’ of increasing the limited capability of the State of California to enforce violations of the Labor Code. [Citation.] The statute authorizes ‘aggrieved employees’ to file lawsuits on behalf of the state seeking civil penalties for violations of the Labor Code, and allocates 75 percent of the civil penalties recovered to the [LWDA] and the remaining 25 percent to all employees affected by the violation. [Citations.] PAGA requires that before filing suit, the so-called PAGA plaintiff must submit notice of the alleged violations to the LWDA and to the employer." ( Hutcheson v. Superior Court (2022) 74 Cal.App.5th 932, 935, 290 Cal.Rptr.3d 60 ( Hutcheson ).)

A. Cornell's Standing to Appeal.

Defendants argue Cornell lacks standing to appeal the judgment because she was never a party to the case nor has she been aggrieved by the dismissal of Hargrove's PAGA claim since she is currently pursuing her own PAGA claim.

" ‘An appeal may be taken only by a party who has standing to appeal. [Citation.] This rule is jurisdictional. [Citation.] Only a party who is aggrieved has standing to appeal.’ [Citation.] Thus, to have standing to appeal an order, the appellant ‘must be a party of record and aggrieved by the challenged ... order.’ [Citation.] ‘One is considered "aggrieved" whose rights or interests are injuriously affected by the [order]. [Citations.] [Such] interest " ‘must be immediate, pecuniary, and substantial and not nominal or a remote consequence of the [order].’ " ’ " ( Dow v. Lassen Irrigation Co. (2022) 75 Cal.App.5th 482, 487-488, 290 Cal.Rptr.3d 553 ; see Code Civ. Proc., § 902 ["Any party aggrieved may appeal" a judgment.].) However, when one has been denied the right to intervene in an action, he or she may appeal from the order denying intervention. ( Hernandez v. Restoration Hardware, Inc. (2018) 4 Cal.5th 260, 263, 228 Cal.Rptr.3d 106, 409 P.3d 281 ( Hernandez ); see Roos v. Honeywell Internat., Inc. (2015) 241 Cal.App.4th 1472, 1484, 194 Cal.Rptr.3d 735 [A party may appeal the denial of a motion to intervene when "it constitutes a final determination of the party's entitlement to participate in the action."], disapproved of on other grounds by Hernandez , at p. 269, fn. 2, 228 Cal.Rptr.3d 106, 409 P.3d 281.)

"In Hernandez the Supreme Court reaffirmed its long-standing precedent that unnamed class members do not become parties of record under [Code of Civil Procedure] section 902 with the right to appeal the class settlement, judgment or attorney fee award unless they (1) move to intervene in the action before the action is final, or (2) move under [Code of Civil Procedure] section 663a to vacate the judgment. [Citations.] Then, if either motion is unsuccessful, the unnamed class member may appeal from the order denying intervention and/or the motion to vacate." ( Eck v. City of Los Angeles (2019) 41 Cal.App.5th 141, 145, 253 Cal.Rptr.3d 883.)

In this case, as a nonparty to this action, Cornell lacks standing to appeal the order dismissing the case. However, this court may treat the unsuccessful motion to amend Hargrove's complaint to add Cornell as the new representative plaintiff as an unsuccessful motion to intervene from which Cornell may appeal. ( Hernandez, supra , 4 Cal.5th at p. 263, 228 Cal.Rptr.3d 106, 409 P.3d 281.) Erring on the side of caution, we will treat the motion to amend as a motion to intervene and consider the merits of Cornell's challenge. The standard of review for denying permissive intervention under Code of Civil Procedure section 387, subdivision (a), is an abuse of discretion. ( Turrieta v. Lyft, Inc. (2021) 69 Cal.App.5th 955, 976, 284 Cal.Rptr.3d 767, review granted Jan. 5, 2022, S271721.)

B. Denial of the Motion to Amend.

Cornell argues that the trial court abused its discretion in denying the motion to amend Hargrove's complaint because (1) PAGA's text and purpose are consistent with allowing the substitution of a PAGA plaintiff (an assignment of Hargrove's PAGA claim), (2) PAGA plaintiffs should be afforded the same rights and protections afforded to class action plaintiffs, and (3) the relation-back doctrine applies. While we agree that a PAGA complaint may be amended to provide for the substitution of another person as the representative plaintiff in the action, we do not agree that it may be done in this case. Thus, the court's decision to deny amendment of Hargrove's complaint to add Cornell as the new representative plaintiff does not constitute...