Thomas v. Aetna Health of Cal. Inc.
| Decision Date | 02 June 2011 |
| Docket Number | CASE NO. 1:10-cv-01906-AWI-SKO |
| Parties | DORRENDA THOMAS, individually, and on behalf of other members of the general public similarly situated, and as an aggrieved employee pursuant to the Private Attorneys General Act, Plaintiff, v. AETNA HEALTH OF CALIFORNIA, INC., et al., Defendants. |
| Court | U.S. District Court — Eastern District of California |
Before the Court is Plaintiff Dorrenda Thomas' motion for remand in Thomas v. Aetna Health of California, et al. ("Thomas"), No. 1:10-cv-01906-AWI-SKO. Plaintiff seeks an award of civil penalties under the California Private Attorneys General Act of 2004 ("PAGA"), codified at Cal. Lab. Code § 2699 (2010), against Defendants Aetna Health of California ("AHC"), Aetna Life Insurance Company ("ALIC"), and Aetna, Inc. ("Aetna") for various Labor Code violations.
The Thomas action is related to Gong-Chun v. Aetna Life Insurance Co., et al. ("Gong-Chun"), 1:09-cv-01995-AWI-SKO, an earlier filed wage and hour class action brought on behalf of non-exempt current and former employees of ALIC. (See Thomas, No. 1:10-cv-01906-AWI-SKO, Doc. 27.) As Aetna and ALIC were both named as defendants in the Gong-Chun and Thomas actions and both cases involved the same or similar groups of plaintiffs, the two matters were relatedby order of the Court.
For the reasons set forth below, the Court recommends that Plaintiff's claim for PAGA penalties asserted against AHC be DISMISSED and Plaintiff's motion for remand be DENIED.
In light of the relationship between Gong-Chun and Thomas, the procedural background of each case is summarized below.
On September 17, 2009, Plaintiff Michael Gong-Chun filed a class action complaint against ALIC and Aetna claiming substantive Labor Code violations for (1) unpaid meal breaks under Labor Code sections 226.7 and 512(a); (2) wages not paid upon termination under Labor Code sections 201 and 202; (3) wages not timely paid during employment under Labor Code section 204; and (4) violation of the California Business & Professions Code § 17200. ALIC and Aetna removed Gong Chun to this Court on November 12, 2009. The Gong Chun class action does not state a claim for PAGA civil penalties. While Plaintiff Dorenda Thomas is not the class representative in the Gong Chun action, she is a putative class member.
On April 2, 2010, ALIC filed a motion to stay all further proceedings pending the outcome of the California Supreme Court's review of Brinker Restaurant Corp. v Superior Court, 80 Cal. Rptr. 3d 781 (2008), petition for review granted, 85 Cal. Rptr. 3d 688. ALIC's motion was granted on May 17, 2010. (See 1:09-cv-01995-AWI-SKO, Doc. 23.) Although Brinker Rest. Corp. v. Sup. Ct. was fully briefed as of May 17, 2010, several other meal break cases have been granted review by the California Supreme Court, including Brinkley v. Pub. Storage, 167 Cal. App. 4th 1278, review granted on January 14, 2009; Bradley v. Networkers Int'l LLC, No. D052365, 2009 WL 265531 (Cal. Ct. App. Feb. 5, 2009), review granted on May 13, 2009; Faulkinbury v. Boyd & Assocs. Inc., 185 Cal. App. 4th 1363 (2010), review granted on October 13, 2010; Brookler v. Radioshack Corp., No. B212893, 2010 WL 3341816 (Cal. Ct. App. Aug. 26, 2010), review granted on November 17, 2010; and Hernandez v. Chipotle Mexican Grill Inc., 189 Cal. App. 4th 751 (2010), review granted on January 26, 2011. The Supreme Court has ordered that the briefing in these cases be held pending Brinker; however, oral argument in Brinker has not yet been scheduled.
On September 2, 2010, Plaintiff Dorrenda Thomas filed a complaint for violation of Labor Code §§ 2698 et seq. pursuant to the California Labor Code Private Attorneys General Act of 2004 ("PAGA") in Fresno County Superior Court against Defendants AHC, Aetna, and ALIC. The action was filed by Plaintiff individually and on behalf of other members of the general public similarly situated, and as an aggrieved employee pursuant to the PAGA.1
According to the complaint, Defendants employed Plaintiff as a "Small Group Sales Support Broker Liaison/Renewal Consultant," a non-exempt (hourly) paid position at Defendants' Fresno County business location. (Doc. 1-1 (Complaint), ¶ 19.) Plaintiff contends that Defendants violated various California Labor Code provisions by failing to (1) pay overtime wages, (2) provide meal periods, (3) provide rest periods, (4) pay minimum wage, (5) timely pay wages upon termination, (6) timely pay wages during employment, and (6) provide complete and accurate wage statements. (Doc. 1-1, ¶¶ 41-47.) 2
On October 12, 2010, Defendants filed a notice of removal, claiming diversity of citizenship pursuant to 28 U.S.C. § 1332(a) as the jurisdictional predicate. Defendants ALIC and Aetna are citizens of the state of Connecticut while AHC is a citizen of California.3 Plaintiff is also a citizen of California. Defendants argue, however, that AHC never employed Plaintiff, is a sham/fraudulentdefendant, and AHC's citizenship must be disregarded for purposes of diversity and jurisdiction. Defendants also assert that more than $75,000 is placed into controversy by virtue of Plaintiff's complaint for PAGA penalties, and thus removal jurisdiction is properly asserted.
On November 10, 2010, Plaintiff filed a motion for remand asserting that AHC is not a fraudulent/sham defendant, and AHC's presence in the litigation destroys diversity. Plaintiff also asserts that her individual stake in the PAGA penalties is not more than $75,000, which she specifically pled in her complaint, and Defendants have not proven to a legal certainty that her portion of the PAGA penalties exceeds the jurisdictional threshold.
The motion for remand was initially scheduled for hearing before District Judge Wanger on January 31, 2011. Judge Wanger determined that reassignment to Chief District Judge Ishii and Magistrate Judge Oberto was appropriate because of the similarity of the instant action with the Gong-Chun class action currently assigned to Chief Judge Ishii. (Doc. 27.) On February 7, 2011, the motion to remand was referred to Magistrate Judge Oberto. On February 16, 2011, Defendants filed a motion to consolidate this matter with the Gong-Chun action, asserting the following:
The Court determined that the motion to consolidate could be potentially rendered moot by the Court's decision regarding the motion for remand. Therefore, the Court vacated the March 16, 2011, hearing date with regard to Defendants' motion to consolidate and currently holds it in abeyance until a final decision is issued with regard to Plaintiff's motion for remand. (Doc. 34.) On April 27, 2011, a hearing was held with regard to Plaintiff's motion for remand. (Doc. 36.) LeslieAbbott, Esq. and Philippe Lebel, Esq. appeared on behalf of Defendants. Netta Roshanian, Esq. appeared on behalf of Plaintiff.4
Plaintiff Michael Gong-Chun is represented by Miriam Schimmel, Payan Shahian, Sang J. Park, and Orlando J. Arellano, of Initiative Legal Group, LLP ("ILG"). ILG also represented Plaintiff Dorrenda Thomas at the time her complaint was filed in Fresno County Superior Court. Thomas is now represented by the Law Offices of Mark Yablonovich. Mr. Yablonovich was once employed by ILG, but he has since started his own practice, and his firm now represents Ms. Thomas. (See Doc. 16; Doc. 32-1, ¶ 9.)
"A defendant may remove an action to federal court based on federal question jurisdiction or diversity jurisdiction." Hunter v. Philip Morris USA, 582 F.3d 1039, 1042 (9th Cir. 2009) (citing 28 U.S.C. § 1441). It is presumed, however, "that a cause lies outside [the] limited jurisdiction [of the federal courts] and the burden of establishing the contrary rests upon the party asserting jurisdiction." Id. (internal quotation marks omitted).
"Federal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance." Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (per curiam). The removing party always bears the burden of establishing that removal is proper, and the court "resolves all ambiguity in favor of remand." Hunter, 582 F.3d at 1042.
The propriety of removal requires the consideration of whether the district court has original jurisdiction of the action, i.e., whether the case could have originally been filed in federal court based on a federal question, diversity of citizenship, or another statutory grant of jurisdiction. See Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987). If the case is within the original jurisdictionof the district...
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