Bell v. Home Depot U.S.A.

1

SANDY BELL and MARTIN GAMA, individually and on behalf of other members of the general public similarly situated, and as aggrieved employees pursuant to the Private Attorneys General Act “PAGA”, Plaintiffs, v. HOME DEPOT U.S.A., INC., a Delaware corporation; JOHN BROOKS, an individual; and DOES 1 through 10, inclusive, Defendants.

No. 2:12-cv-02499-DJC-CKD

United States District Court, E.D. California

June 10, 2024

ORDER GRANTING MOTION FOR RECONSIDERATION OF PRIOR ORDER GRANTING DEFENDANTS' PARTIAL MOTION FOR SUMMARY JUDGMENT BUT GRANTING DEFENDANTS' PARTIAL MOTION FOR SUMMARY JUDGMENT

HON DANIEL J. CALABRETTA UNITED STATES DISTRICT JUDGE

This Court previously granted the Motion for Partial Summary Judgment brought by Defendants Home Depot U.S.A., Inc. (“Home Depot”) and John Brooks (“Brooks”) (together, “Defendants”) which sought to dismiss Plaintiffs' claim for violations of California Labor Code section 203 because Home Depot had a “goodfaith dispute” whether any wages were due arguing that “Home Depot defined its workday in the 1980s and has never changed the definition.” (ECF No. 146 at 2 (emphasis in original).) Defendants supported this argument, which the Court accepted, using the testimony and declaration of Home Depot's Director of Human Resources Operations, Christine Barnaby (“Barnaby”), who Defendants and Barnaby declared had personal knowledge of Home Depot's policies and practices related to the establishment of its work-day schedule. Not so. As it turns out, Barnaby had imperfect or incomplete knowledge and provided “mistaken testimony.” As a result, Plaintiffs now move for reconsideration of this Court's prior Order granting Defendants' Motion for Partial Summary Judgment (ECF No. 158). For the reasons set forth below, the Court GRANTS Plaintiffs' Motion for Reconsideration Regarding the September 7, 2017 Order Granting Partial Summary Judgment (ECF No. 214).

However, despite the Court concluding that there is sufficient new evidence to reconsider its prior grant of partial summary judgment, upon reconsideration, the Court concludes that Plaintiffs have still failed to put forth any facts suggesting that Home Depot changed its workday definition to avoid California's overtime rules. Indeed, there was no daily overtime rule at the time that Home Depot made the change, and Plaintiffs have not alleged that Home Depot made this workday definition change in 1998 to avoid any other overtime rules or California Labor Code requirements. As a result, the Court again GRANTS Defendants' Motion for Partial Summary Judgment (ECF No. 158).

BACKGROUND

I. Factual Background

Plaintiffs Sandy Bell and Martin Gama are California residents who are or were employed by Home Depot. (See Class Action Compl. (ECF No. 1) ¶¶ 8-9 (“Complaint” or “Compl.”).) John Brooks was the regional manager while Plaintiffs worked for Home Depot and was responsible for managing them. (See id. ¶ 11.) Defendants employed Plaintiffs as non-exempt, hourly paid supervisors. (See id. ¶¶ 25-26.)

Plaintiffs bring this lawsuit on behalf of themselves and others similarly situated, alleging that Defendants violated California's Labor Code. Specifically, Plaintiffs allege that Home Depot failed to provide overtime pay, failed to pay the minimum wage, failed to reimburse expenses, failed to provide compliant wage statements, and failed to provide timely payments. (See Compl. ¶¶ 29-38.) Plaintiffs seek damages and injunctive relief for these violations. (See Id. ¶¶ 5-39 of the prayer for relief.)

II. Procedural Background

Plaintiffs filed the Complaint in Sacramento County Superior Court on July 18, 2012 (Compl. at 26) and the action was removed to this Court on October 4, 2012. (See ECF No. 1.) After litigation over the propriety of removal, discovery eventually ensued, and Plaintiffs moved to certify their proposed classes on October 9, 2015. (See ECF No. 67.) Defendants then brought the first motion for partial summary judgment. (See ECF No. 72.) Both motions were granted in part and denied in part in June 2016. (See ECF Nos. 110, 113.) The Court certified only one proposed class, consisting of:

All persons who worked for Defendant Home Depot U.S.A., Inc. in California as a non-exempt, hourly paid supervisor at any time from August 14, 2009 until [May 27, 2016] who worked at least one overnight shift that crossed midnight of more than eight hours, andwho, as a result, was not paid overtime for the hours worked over eight hours during such overnight shift.

(ECF No. 110 at 1.) Similarly, the Court dismissed Plaintiffs' claims related to Home Depot requiring employees to remain on premises during rest breaks and Home Deport failing to include “Success Sharing” bonuses in the calculation of meal period and rest break premiums and in the calculation of the “regular rate of pay.” (ECF No. 113 at 2.)

Defendants later brought another motion for partial summary judgment on May 2, 2017, which is the motion at issue in this case. (See ECF No. 146.) Defendants moved to dismiss Plaintiffs' claims for penalties under California Labor Code sections 203 and 226, arguing that Defendants had a “good faith dispute” regarding whether Plaintiffs were entitled to any of the alleged overtime pay due. (See ECF No. 146 at 1.) The Court granted the motion on September 7, 2017. (See ECF No. 158.)

Addressing the second partial summary judgment motion, the Court held that there was “a good faith dispute warranting summary judgment on the section 203 and 226 derivative claims.” (ECF No. 158 at 5.) The Court found that "[t]he evidence . . . supports the conclusion that Home Depot, at minimum, has a good faith factual defense to the overtime wage claim[,]" and that "[i]n contrast, Plaintiffs have failed to show that this defense is unsupported, unreasonable, or presented in bad faith.” (Id. at 5-6.) The Court found that, though “Home Depot has not submitted direct evidence of a bona fide business purpose for its initial workday designation, Home Depot has presented circumstantial evidence tending to show [that] the company did not design the workday for the purpose of evading overtime wages.” (Id. at 6.) The Court first acknowledged Barnaby's declaration and testimony and noted that the history she proclaimed regarding Home Depot's consistent and unchanged definition of its workday since the 1980s was “relevant because it shows Home Depot defined the workday before it was subject to daily overtime laws in California and maintains the same workday in places that do not regulate overtime.” (Id.) The Court also credited statements from Barnaby indicating that “Home Depot had not analyzed the impact of the workday definition on overtime savings or payments[, which] further indicate[d] a lack of purposeful design.” The Court finally noted that “Home Depot's workday line[d] up with the default workday in the California [Department of Labor Standards Enforcement ("DLSE")] Manual (§ 48.1.3.1), which also suggest[ed] neutrality.” (Id. at 6-7.) “These facts constitute[d] substantial evidence in support of Home Depot's defense that the company did not define the workday for the purpose of evading its daily overtime obligations.” (Id. at 7.)

On July 21, 2023, Defendants filed a Request for Status Conference and Notice of Intent to Move to Strike Mistaken Testimony. (See ECF No. 207.) In that motion, Defendants notified the Court that Defendants had “recently learned that certain statements in the Declaration of Christine Barnaby . . . were mistaken, specifically, the statements that Home Depot's California workday has always been defined as the calendar day and has never changed.” (ECF No. 207 at 2.) Defendants claimed that “[t]he testimony and pleadings at issue were provided in good faith and, as stated in her Declaration, based on the information known to Ms. Barnaby at the time she provided the Declaration.” (Id.) Newly discovered information has revealed, however, that the workday definition for California was defined as 4:00 a.m. to 3:59 a.m. for an approximately six-year period in the 1990s. (Id.) In a subsequent Joint Status Report, Defendants provided their position, asserting that:

Determining events from 30 years prior is obviously challenging. . . . The period of time when the workday differed from the calendar day was over 25 years ago. Home Depot learned of the changed to the workday in the 1990s in the course of its further efforts to locate trial witnesses from the earliest years of the Company's history, and promptly disclosed this fact to the Court and Plaintiff's counsel.

(ECF No. 210 at 4.)

Plaintiffs brought the instant Motion on January 25, 2024. (See Not. of and Mot. for Reconsideration Regarding September 7, 2017 Order; Mem. of P. and A. (ECF No. 214) (“Motion” or “MFR”).) Defendants filed an Opposition and Plaintiffs filed a Reply. (See Defs.' Opp'n to Pls.' MFR (ECF No. 215) (“Opposition” or “Opp'n”); Pls.' Reply in Supp. of MFR (ECF No. 216) (“Reply”).) The Court heard oral arguments on March 28, 2024, where Attorney Melissa Grant appeared for Plaintiffs and Attorney Barbara Miller appeared for Defendants. (See ECF No. 223.) At the hearing, the Court gave the parties the chance to file supplemental briefing “limited to citations and parentheticals, providing supplemental authority addressing whether the failure to change a workday definition or the failure to add a new workday for a new shift is a basis for liability . . . .” (ECF No. 223.) Both parties filed their supplemental briefing on April 4, 2024. (See ECF Nos. 225-26.) The matter is now fully briefed.

DISCUSSION

III. Plaintiffs Present A Sufficient Ground for Reconsideration

Generally speaking, “As long as a district court has jurisdiction over the case, then it possesses the inherent...