Turrieta v. Lyft, Inc.

323 Cal.Rptr.3d 625

552 P.3d 835

Tina TURRIETA, Plaintiff and Respondent,

v.LYFT, INC., Defendant and Respondent;

Million Seifu et al., Movants and Appellants.

S271721

Supreme Court of California.

August 1, 2024

Second Appellate District, Division Four, B304701, Los Angeles County Superior Court, BC714153, Dennis J. Landin, Judge

Lichten & Liss-Riordan, Shannon E. Liss-Riordan and Anne Kramer for Movant and Appellant Million Seifu.

Outten & Golden, Jahan C. Sagafi, Laura Iris Mattes, Adam Koshkin, San Francisco; Olivier Schreiber & Chao, Olivier & Schreiber, Monique Olivier, San Francisco, Christian Schreiber, Emeryville, and Rachel Bien, San Francisco, for Movant and Appellant Brandon Olson.

Teukolsky Law and Laren Teukolsky for California Employment Lawyers Asso- ciation as Amicus Curiae on behalf of Movant and Appellant Brandon Olson.

Michael L, Smith and Alec Segarich for Department of Industrial Relations, Division of Labor Standards Enforcement, as Amicus Curiae on behalf of Movants and Appellants.

The Graves Firm, Allen Graves, Pasadena, Jacqueline Treu and Adrian Hernandez for Plaintiff and Respondent.

Horvitz & Levy, Christopher D. Hu, San Francisco, Peder K. Batalden, Felix Shafir, Burbank; Keker, Van Nest & Peters, R. James Slaughter, Erin E. Meyer, Ian Kanig, San Francisco, and Morgan E. Sharma for Defendant and Respondent.

Paul, Plevin, Sullivan & Connaughton, George S. Howard, Jr., and Jeffrey P. Michalowski, San Diego, for Employers Group and The California Employment Law Council as Amici Curiae on behalf of Plaintiff and Respondent and Defendants and Respondents.

Opinion of the Court by Jenkins, J.

The California Labor and Workforce Development Agency (LWDA) has statutory authority to collect civil penalties from employers that violate certain provisions of the Labor Code. The Labor Code Private Attorneys General Act of 2004 (PAGA) (Lab. Code, § 2698 et seq.)¹ authorizes "aggrieved" employees (§ 2699, subd. (a)) — defined in part as "any person who was employed by the alleged violator and against whom one or more of the alleged violations was committed" (§ 2699, subd. (c)(1)) — to bring an action to recover the civil penalties on the state’s behalf after the LWDA, having been notified of the alleged violations, declines to pursue them (id., subd. (a); § 2699.3). In such actions, the LWDA generally receives the majority of any recovered penalties and "the aggrieved employees" receive the remaining amount.

This case involves what has become a common scenario in PAGA litigation: multiple persons claiming to be an "aggrieved employee" within the meaning of PAGA file separate and independent lawsuits seeking recovery of civil penalties from the same employer for the same alleged Labor Code violations. Tina Turrieta, Brandon Olson, and Million Seifu each worked as a driver for Lyft, Inc. (Lyft) and each filed a separate action seeking civil penalties under PAGA for Lyft’s alleged failure to pay minimum wages, overtime premiums, and business expense reimbursements. In early December 2019, Turrieta and Lyft signed an agreement settling Turrieta’s action and scheduled a settlement approval hearing for January 2, 2020. Before that hearing, Olson and Seifu filed separate motions to intervene in Turrieta’s action and submitted objections to the settlement. The trial court denied the motions, approved the settlement, and later denied the motions of Olson and Seifu to vacate the judgment.

Olson and Seifu appealed, challenging both the settlement and the denials of their various motions. The Court of Appeal affirmed, finding that the trial court had properly denied the intervention motions and that Olson and Seifu lacked standing to move in the trial court to vacate the judgment or to challenge the judgment on appeal. Olson petitioned for our review of the appellate court’s decision, asserting that as a deputized agent of the state under PAGA, he has the right, on behalf of the state, to intervene in Turrieta’s action, to move to vacate the judgment in that action, and to have the court consider his objections to the proposed settlement of that action.

We agree with the Court of Appeal. PAGA provides that an aggrieved employee, after complying with specified procedural prerequisites, may "commence a civil action" to recover civil penalties that the LWDA may assess and collect. (§ 2699.3, subd. (a)(2)(A).) Although a PAGA plaintiff may use the ordinary tools of civil litigation that are consistent with the statutory authorization to commence an action, such as taking discovery, filing motions, and attending trial, we conclude for reasons explained below that the authority Olson seeks in this case — to intervene in the ongoing PAGA action of another plaintiff asserting overlapping claims, to require a court to consider objections to a proposed settlement in that overlapping action, and to move to vacate the judgment in that action — would be inconsistent with the scheme the Legislature enacted. This conclusion best comports with the relevant provisions of PAGA as read in their statutory context, in light of PAGA’s legislative history, and in consideration of the consequences that would follow from adopting Olson’s contrary interpretation. We therefore affirm the Court of Appeal’s judgment.

FACTUAL AND PROCEDURAL BACKGROUND

On May 8, 2018, Turrieta sent notice to the LWDA of "representative claims" she wanted to bring under PAGA based on Lyft’s alleged violation of several "provisions of the Labor Code." Accompanying the notice was a draft complaint identifying Turrieta as a Lyft driver and seeking, "as a Private Attorney General on behalf of the State of California with regard to current and former Lyft Drivers," "relief recoverable under" PAGA based on Lyft’s alleged "willful misclassification of its Driver Employees as independent contractors." In separate causes of action, the draft complaint alleged the following violations of the Labor Code: (1) willfully misclassifying drivers as independent contractors; (2) intentionally failing to pay overtime premiums; (3) failing to timely pay wages; (4) failing to pay wages due upon termination; (5) failing to provide itemized wage statements; and (6) failing to provide equipment or reimburse business expenses. On July 13, 2018, Turrieta filed the complaint in the Los Angeles Superior Court.

In late May 2018, Olson filed a class action complaint against Lyft in the San Francisco Superior Court. About the same time, he sent notice to the LWDA of PAGA claims he wanted to pursue against Lyft. Almost two months later, in August 2018, he added those PAGA claims to his pending class action by filing an amended complaint seeking penalties under PAGA based on his status as a Lyft driver and alleging that Lyft had misclassified drivers as independent contractors and had failed to reimburse business expenses, to pay overtime, to pay minimum wages, to provide adequate wage statements, and to provide required meal and rest breaks.

In April 2019, Olson filed in the San Francisco Superior Court a petition under Code of Civil Procedure section 404.1 to coordinate his action with Turrieta’s action and with three others asserting misclassification claims against Lyft, including one filed by Seifu in Los Angeles Superior Court on July 5, 2018. In June 2019, the court denied the petition "without prejudice," reasoning that coordination would not " ‘promote the ends of justice’ " given that four of the actions in question — including Turrieta’s, Olson’s, and Seifu’s — had been "stayed for all purposes." Olson could have challenged the denial order by petitioning for a writ of mandate (Code Civ. Proc., § 404.6), but he did not do so.

Nor at that time did he seek to intervene in Turrieta’s action.

In September 2019, Turrieta and Lyft attended a mediation. When they failed to reach agreement, the mediator made a settlement proposal based on his valuation of the case, and the parties accepted the proposal. Among other things, the settlement agreement provided as follows: "[T]he Parties agree that they will cooperate in the sending of an amended PAGA letter to the LWDA … and in the drafting and filing of an amended complaint that covers all PAGA claims that could have been brought against Lyft so that PAGA Settlement Group Member Release covers all potential PAGA claims described in this paragraph. Specifically, the amended complaint shall add the following causes of action: Labor Code sections 226.7, 353, 510, 512, 554, 1174, 1174.5, 1182.12, 1194, 1194.2, 1197, 1197.1, 1198, 1199, 2802, 2810.5, and Paragraphs 4, 7, and 10–12 of Wage Order #9-2001. Plaintiff shall provide notice of the settlement to the LWDA after the long-form settlement agreement is executed and the motion for approval is filed."

On December 9, 2019, Turrieta filed a motion for court approval of the settlement, with a hearing set for January 2, 2020. Along with the motion, Turrieta submitted a proposed amended complaint reflecting the terms of the settlement agreement and a request for approval of the amended complaint’s filing. The same day, she sent to the LWDA copies of the proposed settlement agreement, the approval motion, and related filings, including the proposed amended complaint.

The LWDA did not file an opposition or objection to the proposed settlement. However, on December 24, 2019, Olson filed a pleading in Turrieta’s action seeking a court order: (1) granting leave to file a complaint in intervention and to intervene; and (2) denying approval of the proposed settlement or continuing the January 2 approval hearing "until such time as [his intervention] motion [could] be heard." Olson simultaneously submitted a proposed complaint in intervention alleging the same Labor Code violations he had previously alleged in his separate PAGA action. In the proposed complaint’s Prayer for Relief, Olson requested, among other things, "Designation of [his] counsel of record as Lead Counsel for the Aggrieved Employees," ...