Magadia v. Wal-Mart Assocs., Inc.

• Decision Date: 11 May 2018
• Docket Number: Case No. 17-CV-00062-LHK
• Citation: 319 F.Supp.3d 1180
• Parties: Roderick MAGADIA, et al., Plaintiff, v. WAL-MART ASSOCIATES, INC., et al., Defendants.
• Court: U.S. District Court — Northern District of California

319 F.Supp.3d 1180

Roderick MAGADIA, et al., Plaintiff,

v.WAL-MART ASSOCIATES, INC., et al., Defendants.

Case No. 17-CV-00062-LHK

United States District Court, N.D. California, San Jose Division.

Signed May 11, 2018

Dennis Sangwon Hyun, Hyun Legal APC, Larry W Lee, Nicholas Rosenthal, Diversity Law Group, P.C., Los Angeles, CA, William Lucas Marder, Polaris Law Group, LLP, Hollister, CA, for Plaintiff.

Aaron Thomas Winn, Duane Morris LLP, San Diego, CA, Matthew Gordon Ball, K & L Gates LLP, San Francisco, CA, Patrick Michael Madden, Pro Hac Vice, K & L Gates LLP, Seattle, WA, Roman David Hernandez, Troutman Sanders LLP, Portland, OR, for Defendant.

ORDER GRANTING MOTION FOR PARTIAL SUMMARY JUDGMENT

Re: Dkt. No. 67

LUCY H. KOH, United States District Judge

Plaintiff Roderick Magadia ("Plaintiff") brings the instant suit on behalf of himself and others similarly situated against Defendants Wal-Mart Stores, Inc. and Wal-Mart Associates, Inc. (collectively, "Wal-Mart"). Before the Court is Plaintiff's motion for partial summary judgment. Having considered the submissions of the parties, the relevant law, and the record in this case, the Court GRANTS Plaintiff's motion for partial summary judgment.

I. BACKGROUND

A. Factual Background

Wal-Mart is a national retailer with locations throughout the United States. ECF No. 84. Plaintiff worked as a non-exempt employee in Wal-Mart's store in San Jose, California from June 17, 2008 to September 16, 2016. Id.

When one of Wal-Mart's non-exempt California employees works overtime during a given pay period and earns "non-discretionary remuneration in the same pay period," Wal-Mart pays an employee an "additional overtime wage" that appears as "OVERTIME/INCT" on the employee's wage statement. ECF No. 67 ("Mot.") at 19; see ECF No. 67-1, Ex. C, Deposition of Todd Stokes ("Stokes Dep.") at 66–68, 69, 76–77. INCT is an abbreviation for incentive. See Stokes Dep. at 67. This ensures Wal-Mart is in compliance with California Labor Code § 510(a), which requires employers to factor in an employee's non-discretionary remuneration when calculating that employee's overtime pay. See Marin v. Costco Wholesale Corp. , 169 Cal. App. 4th 804, 807, 87 Cal.Rptr.3d 161 (2008) ("Because the nondiscretionary bonus at issue here increases the regular rate of pay, employees who worked overtime during the bonus period and were paid at 1.5 times their hourly rate (unaugmented by the bonus) during that time are entitled to additional overtime pay once the bonus is awarded."). The OVERTIME/INCT item is a lump sum and does not list an hourly rate or specify hours worked. ECF No. 67-1 at 35 (one of Plaintiff's wage statements).

Wal-Mart employees like Plaintiff are paid biweekly. ECF No. 67-1, Ex. 1, Declaration of Todd Stokes ("Stokes Decl.") ¶ 9. Wal-Mart provides employees with biweekly wage statements that correspond to the particular pay period. Id. These wage statements list the start and end dates of the pay period. ECF No. 67-1 at 34 (one of Plaintiff's wage statements). When an employee is terminated, they receive a "Statement of Final Pay" that lists all wages being paid to the employee at the end of employment. Stokes Dep. at 82; Stokes Decl. ¶ 9. According to Todd Stokes, Wal-Mart's "Regional HR Director," as a matter of Wal-Mart's policy and practice, none of Wal-Mart's Statements of Final Pay from December 2015 onwards included pay period start or end dates. Stokes Dep. at 89–91. However, Wal-Mart also generates a final on-cycle wage statement and informs employees how to access it online during their exit interview. Stokes Decl. ¶ 9.

B. Procedural History

Plaintiff filed this putative class action in the Superior Court for the County of Santa Clara on December 2, 2016. See Compl. Plaintiff's complaint alleges causes of action for (1) violation of California Labor Code §§ 226.7 and 512 ; (2) violation of California Labor Code § 226(a) ; (3) violation of the Private Attorney Generals Act, Cal. Lab. Code § 2698, et seq. ; and (4) violation of California's Unfair Competition Law, Cal. Bus. & Prof. Code § 17200, et seq. Id. On January 5, 2017, Wal-Mart removed the action to this Court alleging jurisdiction under the Class Action Fairness Act, 28 U.S.C. § 1332(d)(2). See ECF No. 1. On February 2, 2017, Wal-Mart filed an answer to Plaintiff's complaint. ECF No. 19.

On May 31, 2017, this Court "order[ed] the parties to prepare a neutral notice for putative class members to opt-out of having their names and contact information provided to Plaintiff's counsel. A third party administrator shall distribute the notice and accept opt-outs from the putative class at Plaintiff's expense." ECF No. 27, at 1. Then, on June 5, 2017, Plaintiff filed an "Administrative Motion Regarding Belaire-West Opt-Out Notice Procedure" requesting this Court to (1) order "that the putative class members be given 30 days to opt-out of having their contact information provided to Plaintiff's counsel"; and (2) order Wal-Mart to "provide all known email addresses and cell phones to the administrator in connection with the opt-out process and upon the expiration of the opt-out period, that this information be provided to Plaintiff's counsel." ECF No. 31 at 3.

On June 21, 2017, this Court granted Plaintiff's first request and denied Plaintiff's second request. ECF No. 33. Accordingly, the Court ordered Wal-Mart to "provide the third-party administrator the known mailing addresses and last known home telephone numbers of all putative class members as defined by Plaintiff." Id. at 3. The Court also ordered the notices to be "mailed out within ten (10) days of the third-party administrator's receipt of the putative class members' mailing addresses and last known home phone numbers," and noted that putative class members "will have 30 calendar days from the date of mailing" of the notices to opt-out. Id. at 4.

On January 9, 2018, the Court granted Plaintiff's motion for class certification. ECF No. 84. The Court certified three classes:

Meal Period Regular Rate Class: All current and former California non-exempt retail store employees of Wal-Mart who received non-discretionary remuneration, including "MYSHARE INCT," and was paid any meal period premium payments in the same period that the non-discretionary remuneration was earned, at any time between December 2, 2012, through the present.

OVERTIME/INCT Wage Statement Class: All current and former California non-exempt employees of Wal-Mart who received "OVERTIME/INCT," at any time between December 2, 2015, through the present.

Final Wage Statement Class : All former non-exempt employees who worked for Wal-Mart in the State of California and whose employment terminated (whether voluntarily or involuntarily) at any time from December 2, 2015 to the present.

Id. at 22.

On October 30, 2017, Plaintiff moved for partial summary judgment on Plaintiff's claim under California's he Private Attorneys General Act ("PAGA"). ECF No. 67. Plaintiff's motion for partial summary judgment was filed after Plaintiff moved for class certification, but before the Court issued its order granting class certification. On January 16, 2018, Wal-Mart filed its opposition. ECF No. 86 ("Opp."). On February 5, 2018, Plaintiff filed his reply. ECF No. 91 ("Reply").

On February 5, 2018, the Court denied Wal-Mart's motion to stay and struck disputed language from the class notice. ECF No. 92.

On March 12, 2018, the Court ordered Plaintiff to file a class notice update. ECF No. 97. Plaintiff filed the class notice update on March 14, 2018. ECF No. 98. On March 30, 2018, the Court ordered Plaintiff to file a second class notice update. ECF No. 106. On April 2, 2018, Plaintiff filed a second class notice update. ECF No. 107.

II. LEGAL STANDARD

Summary judgment is proper where the pleadings, discovery, and affidavits show that there is "no genuine dispute as to any material fact and [that] the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). Material facts are those which may affect the outcome of the case. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A dispute as to a material fact is genuine if there is sufficient evidence for a reasonable jury to return a verdict for the nonmoving party. See id.

The party moving for summary judgment bears the initial burden of identifying those portions of the pleadings, discovery and affidavits which demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett , 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Once the moving party meets its initial burden, the nonmoving party must go beyond the pleadings and, by its own affidavits or discovery, "set forth specific facts showing that there is a genuine issue for trial." Fed. R. Civ. P. 56(e). If the nonmoving party fails to make this showing, "the moving party is entitled to judgment as a matter of law." Celotex Corp. , 477 U.S. at 323, 106 S.Ct. 2548.

At the summary judgment stage, the Court must view the evidence in the light most favorable to the nonmoving party: if evidence produced by the moving party conflicts with evidence produced by the nonmoving party, the judge must assume the truth of the evidence set forth by the nonmoving party with respect to that fact. See Leslie v. Grupo ICA , 198 F.3d 1152, 1158 (9th Cir. 1999).

III. DISCUSSION

Plaintiff moves for summary judgment on Plaintiff's PAGA claim, and argues that Wal-Mart has violated California Labor Code § 226(a)(6) and § 226(a)(9). Wal-Mart contests the underlying § 226(a)(6) and § 226(a)(9) violations. Wal-Mart also advances the threshold arguments that Plaintiff's summary judgment motion is barred by the one-way intervention rule, that Plaintiff can only claim limited damages under California Labor Code § 226(e), and that Plaintiff failed to administratively exhaust his PAGA claim before filing this action. The Court first addresses Wal-Mart's threshold arguments, and then turns to...