Ramirez v. Southern California Pizza Co.

1

ALEJANDRO RAMIREZ et al., Plaintiffs and Appellants, v. SOUTHERN CALIFORNIA PIZZA COMPANY, LLC, Defendant and Respondent.

G062245

California Court of Appeals, Fourth District, Third Division

November 22, 2024

NOT TO BE PUBLISHED

Appeal from a judgment of the Superior Court of Orange County, No JCCP 4725 William D. Claster, Judge. Affirmed in part reversed in part, and remanded; appeal from order granting motion to compel arbitration dismissed.

Capstone Law, Ryan H. Wu, Melissa Grant and Tyler Anderson for Plaintiffs and Appellants.

Keller Grover, Eric A. Grover; Finkelstein, Blankinship Frei-Pearson &Garber, Jeremiah Frei-Pearson and Bradley F. Silverman for Plaintiff and Appellant Carolina Huerta.

Law Offices of Ramin R. Younessi, Ramin R. Younessi and Jason J. Buccat for Plaintiff and Appellant Rene Najarro.

Matern Law Group, Matthew Matern and Matthew Gordon for Plaintiff and Appellant Elena Cassiano Falero.

Bitton & Associates and Ophir Bitton for Plaintiff and Appellant Kevin Deanda.

Barrera & Associates, Patricio T.D. Barrera; Davenport Law and Ashley Davenport for Plaintiff and Appellant Morgan Gregory.

Seyfarth Shaw, Jon D. Meer, Leo Q. Li and Justin J. Jackson for Defendant and Respondent.

OPINION

GOODING, J.

Multiple lawsuits in different counties were filed against Southern California Pizza Company, LLC (SoCal Pizza) by its employees for various wage and hour claims. The Judicial Council ordered many of the cases coordinated and assigned the proceedings to the trial court. This appeal challenges the court's rulings in the coordinated proceeding (1) denying class certification of a claim that SoCal Pizza's drivers were not fully reimbursed for their expenses when they used their own vehicles to deliver pizzas, (2) denying class certification of a claim that SoCal Pizza improperly calculated overtime pay, therefore undercompensating employees, (3) limiting the period for which a class of employees could recover for rest break violations and dismissing the related waiting time penalty claim, and (4) ordering to arbitration the individual claim of the new class representative of a Fair Labor Standards Act (FLSA) claim.

For the reasons detailed below, we affirm with two exceptions. First, when the trial court limited the time period for the rest break cause of action, it also dismissed a cause of action for a waiting time claim on the ground that claim was "entirely derivative of the rest break claim." The California Supreme Court subsequently rejected that premise. We therefore reverse the order dismissing the waiting time claim but express no opinion as to whether it has merit or is time-barred, in whole or in part. Second, we conclude the court's order granting the motion to compel arbitration is not appealable, and the appeal of that order must therefore be dismissed.

FACTUAL AND PROCEDURAL BACKGROUND^[1]

I. THE PARTIES

Defendant SoCal Pizza is a franchisee of Pizza Hut of America and operates more than 200 stores in Southern California. Plaintiffs are employees of SoCal Pizza. The following cases are part of the coordinated proceeding:

1. Alejandro Ramirez v. Southern California Pizza Company, LLC, case No. BC470642 (Ramirez Action), originally filed by plaintiff Demetrio Hernandez in Los Angeles County Superior Court on September 30, 2011; Ramirez was substituted in as the lead plaintiff on January 16, 2014;

2. Carolina Huerta v. Southern California Pizza Company, LLC, case No. BC516989, filed August 1, 2013 in Los Angeles County Superior Court; 3. Uriel Hernandez v. Southern California Pizza Company, LLC, case No. BC544871 (Hernandez Action), filed May 7, 2014 in Los Angeles County Superior Court;

4. Ibrahim Tascic v. Southern California Pizza Company, LLC, case No. RIC 1406622, filed July 3, 2014 in Riverside County Superior Court;

5. Morgan Gregory v. Southern California Pizza Company, LLC, case No. BC557320, filed September 11, 2014 in Los Angeles County Superior Court;

6. Lourdes Banas, Dong Nguyen, and Sarkis Everekyan v. Southern California Pizza Company, LLC, case No. BC563801, filed November 14, 2014, in Los Angeles County Superior Court;

7. Rene Najarro v. Southern California Pizza Company, LLC, case No. BC634946, filed September 22, 2016 in Los Angeles County Superior Court;

8. Elena Cassiano Falero v. Southern California Pizza Company, LLC, case No. BC657077 (Falero Action), filed April 10, 2017 in Los Angeles County Superior Court; and

9. Kevin Deanda v. Southern California Pizza Company, LLC, case No. BC672995, filed August 18, 2017 in Los Angeles County Superior Court.^[2] Plaintiffs filed a consolidated complaint in the coordinated proceeding on May 8, 2018. The consolidated complaint was amended twice; the second amended consolidated complaint is the operative complaint.

II. TRIAL COURT DENIES PLAINTIFFS' MOTION FOR CLASS CERTIFICATION FOR DELIVERY DRIVERS BASED ON PER DELIVERY REIMBURSEMENT FEE

In March 2016, plaintiffs in the Ramirez Action moved to certify a class of pizza delivery drivers, arguing the use of a flat, per delivery reimbursement policy had under-reimbursed the drivers. The trial court denied that motion based on lack of commonality, the predominance of individual issues, and the lack of a uniform policy. In December 2020 (after consolidation), plaintiffs again moved for class certification on the delivery driver reimbursement claim. The trial court found collateral estoppel did not bar a new motion for class certification, but it again denied the motion "[b]ecause liability would turn on a series of individualized inquiries."

III. TRIAL COURT DENIES PLAINTIFFS' MOTION FOR CLASS CERTIFICATION AS TO OVERTIME WAGES

In August 2020, plaintiffs filed a motion to certify classes of employees who were not properly paid overtime wages and meal and rest period premiums. Plaintiffs alleged SoCal Pizza had undercalculated overtime pay and premium pay for employees who worked different positions at different hourly pay rates during the same workweek. In March 2021, the trial court denied the motion as to the rate classes because it found issues of individualized proof made the claim unsuited to class treatment.

IV. TRIAL COURT GRANTS CLASS CERTIFICATION AS TO REST BREAK CLAIMS AND WAITING TIME PENALTY CLAIMS, BUT LATER GRANTS JUDGMENT ON THE PLEADINGS AS TO CLAIMS ARISING BEFORE MAY 7, 2010 DUE TO FOUR-YEAR STATUTE OF LIMITATIONS AND DISMISSES THE WAITING TIME PENALTY CLAIMS

Plaintiffs filed a class certification motion based on the denial of the right to leave the premises for rest breaks, with plaintiff Falero to be appointed as the class representative. Plaintiffs alleged SoCal Pizza had a written policy, in violation of California law, that employees could not leave the premises during rest breaks without obtaining permission to do so from their supervisor. Plaintiffs also sought certification of a class based on derivative waiting time penalty claims. The trial court granted the motion.

In May 2021, SoCal Pizza moved for judgment on the pleadings of the rest break claim. SoCal Pizza argued the statute of limitations barred any claims that had accrued before May 7, 2010. Although the Ramirez Action contained a rest break claim and was filed September 30, 2011, that claim was summarily adjudicated against Ramirez in June 2015, before the consolidated complaint was filed. The earliest filed case with a rest break claim that was not summarily adjudicated was the Hernandez Action, filed May 7, 2014. The Falero Action was not filed until almost three years later, in April 2017. The trial court found neither the relation back doctrine nor principles of tolling applied and granted the motion for judgment on the pleadings.

In the same order, the trial court found the waiting time penalty claim was "entirely derivative of the rest break claim" and dismissed that claim. The court based its order on the appellate court decisions in Naranjo v. Spectrum Security Services, Inc. (2019) 40 Cal.App.5th 444, reversed in part and remanded, Naranjo v. Spectrum Security Services, Inc., 13 Cal.5th 93, and Betancourt v. OS Restaurant Services, LLC (2020) 49 Cal.App.5th 240 (nonpub. opn.), transferred with directions to vacate and reconsider, S262866, June 29, 2022, 2022 Cal. Lexis 3536.^[3]

V. TRIAL COURT ORDERS NEWLY-NAMED CLASS REPRESENTATIVE ON WAGE STATEMENT CLAIMS TO ARBITRATION

The parties reached a settlement of some, but not all, of the FLSA wage statement claims asserted in the Ramirez Action.^[4] Stanford Midling was part of the class of plaintiffs whose claims were resolved by the partial settlement. The trial court granted preliminary approval of the partial settlement in June 2018, after which class notice was sent out. In March 2019, the trial court granted final approval of the partial FLSA class settlement.^[5]

The FLSA wage statement claims not resolved by the settlement were included in the first amended consolidated complaint, filed November 30, 2018; Claudio Raigoza was the named plaintiff for those claims. Raigoza had agreed to arbitration as part of her employment agreement, and SoCal Pizza moved to compel Raigoza's individual claims to arbitration on December 19, 2018. The court did not order arbitration at that time "pending the resolution or determination of such issues which may make arbitration unnecessary."

On October 25, 2019, plaintiffs filed a second amended consolidated complaint substituting Midling for Raigoza as the named plaintiff on the remaining FLSA wage statement claims. Three days later, SoCal Pizza filed a motion to compel arbitration of Midling's individual FLSA claims. The trial court granted the motion to compel arbitration finding that because Midling was not a named plaintiff before ...