Safeway, Inc. v. Superior Court

• Decision Date: 22 July 2015
• Docket Number: B255216
• Citation: 238 Cal.App.4th 1138,190 Cal.Rptr.3d 131
• Court: California Court of Appeals Court of Appeals
• Parties: SAFEWAY, INC. et al., Petitioners, v. The SUPERIOR COURT OF LOS ANGELES COUNTY, Respondent; Enrique Esparza et al., Real Parties in Interest.

238 Cal.App.4th 1138

190 Cal.Rptr.3d 131

SAFEWAY, INC. et al., Petitioners,

v. The SUPERIOR COURT OF LOS ANGELES COUNTY, Respondent;Enrique Esparza et al., Real Parties in Interest.

B255216

Court of Appeal, Second District, Division 4, California.

Filed July 22, 2015

Payne & Fears, Irvine, James L. Payne, Eric C. Sohlgren, Jeffrey K. Brown and Andrew K. Haeffele for Petitioners.

Arias Ozzello & Gignac, Mike Arias, Makael H. Stahle and Alfredo Torrijos, Granada Hills, for Real Parties In Interest.

MANELLA, J.

In the underlying action, real parties in interest asserted putative class claims against petitioners Safeway Inc. (Safeway) and The Vons Companies (Vons) for violations of the Labor Code and the unfair competition law (UCL) ( Bus. & Prof. Code, § 17200 et seq. ). The trial court certified a class for purposes of the UCL claim based on the theory that petitioners had a practice of never paying premium wages for missed meal breaks when required ( Lab. Code, § 226.7 ). Petitioners seek a writ of mandate directing the trial court to vacate the grant of certification and to enter a new order denying certification. We deny the petition for writ of mandate.

RELEVANT FACTUAL AND PROCEDURAL BACKGROUND

In 2007, the initial class action complaint was filed in the underlying action. In February 2009, real parties in interest Enrique Esparza, Cathy Burns, Sylvia Vezaldenos, and Levon Thaxton II filed their second amended complaint, asserting claims for failure to provide meal and rest breaks ( Lab. Code, §§ 226.7, 512 ), failure to provide itemized pay statements ( Lab. Code, § 226 ), unfair business practices under the UCL, and penalties under the Labor Code Private Attorneys General Act of 2004 (PAGA) ( Lab. Code, § 2698 et seq. ). The complaint alleged that petitioners failed to provide meal and rest breaks, and failed to pay compensation for those missed breaks.

In January 2013, real parties in interest filed a motion for class certification of their claims for failure to provide meal and rest breaks, unfair business practices, and PAGA penalties. They proposed two classes, namely, the "[m]eal [b]reak [c]lass," composed of over 200,000 employees who worked for petitioners between December 28, 2001 and June 17, 2007, and the "[r]eceiver [r]est [b]reak [s]ubclass," composed of all such employees who worked as receivers after December 28, 2001. In connection with the meal break class, real parties in interest sought class certification of the UCL claim, arguing that prior to June 17, 2007, petitioners had a policy of never paying the meal break premium wages set forth in Labor Code section 226.7 "under any circumstances," and that the policy constituted an unlawful or unfair business practice under the UCL.

On February 6, 2014, the trial court granted the motion with respect to the meal break class, and otherwise denied the motion. On March 28, 2014, petitioners filed their petition for writ of mandate. We issued an order to show cause on February 26, 2015.

DISCUSSION

Petitioners contend the trial court erred in granting class certification with respect to the meal break class. For the reasons discussed below, we disagree.¹

A. Standard of Review

" Code of Civil Procedure section 382 authorizes class action suits in California ‘when the question is one of a common or general interest, of many persons, or when the parties are numerous, and it is impracticable to bring them all before the court....’ The party seeking certification as a class representative must establish the existence of an ascertainable class and a well-defined community of interest among the class members. [Citation.] The community of interest requirement embodies three factors: (1) predominant common questions of law or fact; (2) class representatives with claims or defenses typical of the class; and (3) class representatives who can adequately represent the class. [Citation.]" ( Richmond v. Dart Industries, Inc. (1981) 29 Cal.3d 462, 470, 174 Cal.Rptr. 515, 629 P.2d 23.)

When "[p]resented with a class certification motion, a trial court must examine the plaintiff's theory of recovery, assess the nature of the legal and factual disputes likely to be presented, and decide whether individual or common issues predominate. To the extent the propriety of certification depends upon disputed threshold legal or factual questions, a court may, and indeed must, resolve them.... [H]owever, a court generally should eschew resolution of such issues unless necessary. [Citations.] Consequently, a trial court does not abuse its discretion if it certifies (or denies certification of) a class without deciding one or more issues affecting the nature of a given element if resolution of such issues would not affect the ultimate certification decision." ( Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004, 1025, 139 Cal.Rptr.3d 315, 273 P.3d 513 ( Brinker ).)

"On review of a class certification order, an appellate court's inquiry is narrowly circumscribed. ‘The decision to certify a class rests squarely within the discretion of the trial court, and we afford that decision great deference on appeal, reversing only for a manifest abuse of discretion.... A certification order generally will not be disturbed unless (1) it is unsupported by substantial evidence, (2) it rests on improper criteria, or (3) it rests on erroneous legal assumptions. [Citations.]’ [Citations.] Predominance is a factual question; accordingly, the trial court's finding that common issues predominate generally is reviewed for substantial evidence. [Citation.]" ( Brinker, supra, 53 Cal.4th at p. 1022, 139 Cal.Rptr.3d 315, 273 P.3d 513, quoting Fireside Bank v. Superior Court (2007) 40 Cal.4th 1069, 1089, 56 Cal.Rptr.3d 861, 155 P.3d 268.)

Petitioners challenge the class certification on several grounds, including the legal viability of real parties in interest's theory of recovery under the UCL. However, because certification is not "conditioned upon a showing that class claims for relief are likely to prevail," an inquiry into the merits of a claim is ordinarily appropriate only when that question is "enmeshed with class action requirements, such as whether substantially similar questions are common to the class and predominate over individual questions or whether the claims or defenses of the representative plaintiffs are typical of class claims or defenses." ( Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 443, 97 Cal.Rptr.2d 179, 2 P.3d 27.) Thus, defendants are generally not entitled to a merits determination in the context of a ruling on class certification. ( Ibid . ) Nonetheless, that determination may be proper when the defendants cannot attack the claim by demurrer or summary judgment following certification, or the parties jointly request a merits determination. ( Id . at p. 443, 97 Cal.Rptr.2d 179, 2 P.3d 27.)

Here, petitioners did not establish those special circumstances before the trial court, which made no merits determination. In this writ proceeding, real parties in interest have responded to petitioners' challenges to their theory of recovery under the UCL, but have not requested a merits determination. We therefore limit our examination of the merits of real parties in interest's theory of recovery to those issues related to class action requirements.

B. Governing Principles

We begin by discussing the principles applicable to real parties in interest's theory of recovery under the UCL. Generally, the UCL defines "unfair competition" broadly to include "any unlawful, unfair or fraudulent business act or practice." ( Bus. & Prof. Code, § 17200.) "By proscribing ‘any unlawful’ business practice, ‘[the UCL] "borrows" violations of other laws and treats them as unlawful practices’ that the unfair competition law makes independently actionable. [¶] However, the law does more than just borrow. The statutory language referring to "any unlawful, unfair or fraudulent" practice (italics added) makes clear that a practice may be deemed unfair even if not specifically proscribed by some other law." ( Cel–Tech Communications, Inc. v. Los Angeles Cellular Telephone Co . (1999) 20 Cal.4th 163, 180, 83 Cal.Rptr.2d 548, 973 P.2d 527 ( Cel–Tech ).) Under the UCL, damages cannot be recovered, and plaintiffs are generally limited to restitution and injunctive relief. ( Clark v. Superior Court (2010) 50 Cal.4th 605, 610, 112 Cal.Rptr.3d 876, 235 P.3d 171.)

Real parties in interest's theory of recovery under the UCL focuses on the additional compensation afforded employees under the Labor Code for failure to provide meal breaks.² Section 512 obliges employers to provide 30–minute meal periods within a work break at specified intervals absent special circumstances, that is, unless the employee waives or agrees to modify that requirement, or an exception to the requirement is set forth in an applicable wage order issued by the Industrial Welfare Commission (IWC). ( § 512, subds.(a), (b).) Under section 512, "an employer's obligation is to provide a first meal period after no more than five hours of work and a second meal period after no more than 10 hours of work." ( Brinker, supra, 53 Cal.4th at p. 1049, 139 Cal.Rptr.3d 315, 273 P.3d 513.) That obligation reflects the requirements generally stated in the IWC wage orders. ( Brinker, supra, at pp. 1046–1049, 139 Cal.Rptr.3d 315, 273 P.3d 513.)

As explained in Brinker, to comply with the obligation, the employer must afford an "off-duty" meal break, absent an employee waiver or agreement. ( Brinker, supra, 53 Cal.4th at p. 1039, 139 Cal.Rptr.3d 315, 273 P.3d 513.) The employer properly provides an off-duty break "if it relieves its employees of all duty, relinquishes control over their activities and permits them a reasonable opportunity to take an uninterrupted 30–minute break, and does not impede or discourage them from doing so." ( Id . at p. 1040, 139 Cal.Rptr.3d 315, 273 P.3d 513.) Thus, the employer "may not undermine a formal policy of...