Miller v. Icon Clinical Research LLC

• Decision Date: 20 August 2020
• Docket Number: CASE NO. 20-cv-04117-YGR
• Court: U.S. District Court — Northern District of California
• Parties: CHRYSTAL L. MILLER, Plaintiff, v. ICON CLINICAL RESEARCH LLC, ET AL., Defendants.

CHRYSTAL L. MILLER, Plaintiff, v. ICON CLINICAL RESEARCH LLC, ET AL., Defendants.

CASE NO. 20-cv-04117-YGR

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA

August 20, 2020

ORDER DENYING MOTION FOR REMAND

Re: Dkt. Nos. 9, 13

Plaintiff Chrystal Miller brings this wage-and-hour putative class action against defendants ICON plc ("ICON"); ICON Clinical Research, LLC ("ICON Clinical"); DOCS Global Inc.; and Lynda Holcroft. The complaint alleges that ICON employed plaintiff as a Clinical Research Associate ("CRA") from approximately October 9, 2017 through March 19, 2019, during which time defendants misclassified her and other CRAs as exempt employees. Plaintiff asserts five causes of action on behalf of herself and the putative class: (1) failure to pay overtime wages; (2) failure to provide meal and rest periods; (3) failure to provide accurate, itemized wage statements; (4) failure to pay all final wages in a timely manner; and (5) unlawful and unfair business practices. Plaintiff defines the putative class as "[a]ll persons employed in the State of California by Defendant ICON plc as a Clinical Research Associate in any position . . . at any time commencing on the date four (4) years prior to the filing of this Complaint and through the date of trial ('Class Period')."

On June 22, 2020, ICON Clinical Research LLC ("ICON Clinical") removed this action on the basis that federal subject matter jurisdiction exists pursuant to the Class Action Fairness Act ("CAFA"), 28 U.S.C. sections 1332(d) and 1453. Plaintiff now seeks to remand the case on the ground that this action falls within the local controversy exception to CAFA, set forth in 28 U.S.C. section 1332(d)(4)(A). Under this exception, a district court must decline to exercise jurisdiction:

(i) over a class action in which—

(I) greater than two-thirds of the members of all proposed plaintiff classes in the aggregate are citizens of the State in which the action was originally filed; (II) at least 1 defendant is a defendant—

(aa) from whom significant relief is sought by members of the plaintiff class;

(bb) whose alleged conduct forms a significant basis for the claims asserted by the proposed plaintiff class; and

(cc) who is a citizen of the State in which the action was originally filed; and

(III) principal injuries resulting from the alleged conduct or any related conduct of each defendant were incurred in the State in which the action was originally filed; and

(ii) during the 3-year period preceding the filing of that class action, no other class action has been filed asserting the same or similar factual allegations against any of the defendants on behalf of the same or other persons[.]

28 U.S.C. § 1332(d)(4)(A). While defendants bear the burden of proving that removal is appropriate, plaintiff bears the burden of showing an exception applies. Serrano v. 180 Connect, Inc., 478 F.3d 1018, 1024 (9th Cir. 2007).

There appears to be no dispute that (i) the principal injuries resulting from the alleged conduct were incurred in California and (ii) in the three years prior to filing of the complaint, no other class action has been filed asserting the same or similar allegations against the defendants on behalf of the same proposed class. Thus, the Court proceeds to consider whether plaintiff has demonstrated that (i) greater than two-thirds of the putative class are California citizens and (ii) at least one defendant from whom significant relief is sought and whose conduct forms a significant basis for the claims is a California citizen.¹

I. Plaintiff Has Not Shown that Greater Than Two-Thirds of the Proposed Class Are Citizens of California

To qualify for the local controversy exception, plaintiff must show that greater than two-thirds of the proposed class members are California citizens. 28 U.S.C. § 1332(d)(4)(A)(i)(I). Citizenship is determined "as of the date the case became removable[.]" Mondragon v. Capital One Auto Fin., 736 F.3d 880, 883 (9th Cir. 2013). The individual factors of a party's citizenship are "essentially factual." Lew v. Moss, 797 F.2d 747, 750 (9th Cir. 1986). Plaintiff must establish the required facts by a preponderance of evidence. Mondragon, 736 F.3d at 884.

With respect to plaintiff herself, the complaint alleges that she is a California citizen, was "employed" "in the state of California" during the class period, and "perform[ed] her duties as a Clinical Research Associate remotely from her California residence or by traveling from her California residence." Defendant calls into question plaintiff's citizenship, noting that she was issued a Georgia driver's license in October 2018. Plaintiff, however, submits evidence that she possesses a current California driver's license and has resided in California continuously since 2017. "[A] person's old domicile is not lost until a new one is acquired." Lew, 797 F.2d at 750. Defendant's proffered evidence of a Georgia driver's license, particularly when weighed against plaintiff's declaration and the allegations in the complaint, does not suffice to demonstrate plaintiff is not a California citizen.

With respect to the citizenship of the putative class, plaintiff points to evidence that ICON Clinical employed at least 110 CRAs in California during the putative class period of October 9, 2017 through March 19, 2019, and issued wage statements to approximately 78 CRAs in California from April 26, 2019 through June 5, 2020. Plaintiff avers that because wage statements were sent to 78 out of 110 CRAs (i.e., approximately 71 percent of the putative class) in California, plaintiff has established their residency and place of employment in California, which in turn is evidence of citizenship. Plaintiff's conclusion, however, does not follow from the evidence. That ICON Clinical paid 78 CRAs in California during a period spanning both before and after the case became removable does not establish how many of the approximately 110 putative class members were California citizens at the time the case became removable. Indeed, ICON Clinical proffers evidence that from April 20, 2016 through June 16, 2020, approximately 48 of the 110 CRAs separated from their employment with ICON Clinical, making it likely some of those 78 CRAs paid in California subsequently left the company and moved out of the state. Finally, ICON Clinical proffers that it employed "at least" 110 CRAs in California during the class period. If that number is just slightly greater (i.e., 117 or more), without a corresponding rise in California citizens, plaintiff would not satisfy the two-thirds threshold.

The Ninth Circuit has found similar flaws sufficient to defeat remand motions. For example, in Mondragon, the putative class consisted of consumers who had purchased andregistered cars in California. 736 F.3d at 882-83. The Ninth Circuit held that there was "simply no evidence in the record to support a finding of two-thirds citizenship." Id. at 884. It noted "[t]hat a purchaser may have a residential address in California does not mean that person is a citizen of California." Id. Rather, cars might have been purchased and registered in California by out-of-state students, owners of second homes, or other temporary residents. Id. Further, the proposed class covered purchases made years before the case became removable, during which time putative class members may have left the state. Id.

In King v. Great American Chicken Corp., the Ninth Circuit reaffirmed its holding in Mondragon in the context of a putative wage and hour class action. 903 F.3d 875, 880 (9th Cir. 2018). The Ninth Circuit in King overturned the district court's remand order, finding that despite a stipulation that at least two-thirds of the putative class had last-known addresses in California, the "narrow cushion provided by the stipulation, the likelihood that some putative class members were legally domiciled in or subsequently relocated to another state, and the probability that some class members were not United States citizens," meant the court could not conclude that there was sufficient evidence to meet the two-thirds requirement. Id. at 879-80.²

Here, as in King, plaintiff fails to provide sufficient facts to carry her burden of showing that two-thirds of proposed class members are California citizens. This factor is not satisfied.³

II. Plaintiff Has Alleged that One Defendant from Whom Significant Relief Is Sought and Whose Conduct Forms a Significant Basis for the Claims is a California Citizen

Although the Court's finding with respect to the two-thirds requirement precludes remand at this juncture, the Court nevertheless addresses the second factor at issue in the briefing. Toqualify for the local controversy exception, plaintiff also must show at least one defendant from whom "significant relief" is sought and whose alleged conduct forms a "significant basis" for the claims asserted is a California citizen. 28 U.S.C. § 1332(d)(4)(A)(i)(II). Plaintiff points to Holcroft, who the complaint alleges is a citizen of California. Plaintiff also has submitted evidence in support of the motion showing that Holcroft is a citizen of California, as she is a current resident of the state and has resided here continuously since 1991. Thus, the question before the Court is whether plaintiff has satisfied the "significant basis" and "significant relief" requirements as they relate to Holcroft. In determining whether these requirements are met, this Court must look to the allegations in the complaint and may not consider extrinsic evidence. Coleman v. Estes Express Lines, Inc., 631 F.3d 1010, 1019 (9th Cir. 2011).

A. "Significant Basis"

The complaint alleges all causes of action against all defendants. Paragraph 7 of the complaint addresses Holcroft specifically. Plaintiff alleges that Holcroft is a "director" of ICON and "oversaw the work" of CRAs "by providing guidance and oversight to the clinical trial monitoring employees ensuring adherence to project scope, SOPs,...