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AMALGAMATED TRANSIT UNION v. LAIDLAW TRANSIT SERVICES

November 18, 2005.

AMALGAMATED TRANSIT UNION, LOCAL 1209, AFL-CIO, et. al., Plaintiffs,
v.
LAIDLAW TRANSIT SERVICES, INC, et. al., Defendants.



The opinion of the court was delivered by: IRMA GONZALEZ, District Judge

ORDER GRANTING IN PART AND DENYING IN PART FIRST TRANSIT'S MOTION TO STRIKE
Presently before the Court is First Transit, Inc.'s ("defendant") motion to strike pursuant to Fed.R.Civ.P. 12(f) portions of Amalgamated Transit Local 1309, AFL-CIO, Selma Shackelford, Gregory Passmore, Ronald G. Duncan, Timothy Thurmann, Samuel J. Frank, Alexander Bradley, Michele L. Boswell, John A. Taylor, Terrence Sandidge, Kuniyuki Kashiuagi, Gwenaida Cole, Lela Shipman, Sharon K. Harris, Fabis Horton III and Philip Bingman's ("plaintiffs") complaint.*fn1 For the reasons discussed below, the Court denies defendant's motion to strike plaintiffs' Labor Code § 226.7 claims for money damages stemming from defendant's alleged failure to provide meal and rest periods prior to April 12, 2004. Court also denies defendant's motion to strike plaintiffs' claims brought under Business and Professions Code Sections 17200 et seq. The Court grants defendant's motion to strike allegations under sections 1194 and 1194.2 and defendant's motion to strike claims for attorney's fees brought under the Private Attorneys General Act of 2004.

BACKGROUND

  A. Factual

  Defendant had a contract with the San Diego Metropolitan Transit Systems (SDMTS) to provide transportation services in the San Diego and El Cajon areas that terminated on September 30, 2001. (Memo. ISO Motion, 2.) In their complaint, plaintiffs allege that defendant failed to provide meal and/or rest break periods to its employees.

  B. Procedural

  Plaintiffs filed the present action in state court on April 12, 2005. On June 9, 2005, defendant filed for removal to this Court pursuant to 28 U.S.C. 1441 and the Class Action Fairness Act of 2005. Plaintiffs seek recovery for "one hour of pay" for each day that defendant did not provide a meal period and "one hour of pay" for each day that defendant did not provide a rest period under Labor Code § 226.7. (Compl. ¶ 25.) Plaintiffs seek restitution for unpaid "wages," attorney's fees and costs of suit under Labor Code § 1194 and 1194.2 and make parallel claims under Labor Code § 218.5 and 218.6 "in the event" that sections 1194 and 1194.2 are found inapplicable. (Id. ¶ 26, 28.) Under Labor Code § 558, plaintiffs claim additional civil penalties in the amount of $50 for each initial violation of the meal and rest period requirements and $100 for each subsequent violation. (Id. ¶ 31.) Plaintiffs' second cause of action restates the foregoing claims under California's Unfair Competition Law, Business & Professions Code § 17200, et seq. (Id. ¶ 34-36.) Finally, plaintiffs seek reasonable attorney's fees under the Private Attorneys General Act of 2004 (PAGA). (Id. ¶ 32.)

  Defendant moves to strike much of this complaint. Defendant first argues that the recovery mandated by section 226.7 is a "penalty" subject to California Code of Civil Procedure § 340's one year statute of limitation and moves to strike plaintiffs' untimely claims for damages. (Notice of Motion.) Next, defendant argues that section 17200 is unavailable because plaintiffs lack standing. (Id.) Defendant moves to strike references to sections 1194, 1194.2 as inapplicable to the facts plead by plaintiffs. (Notice of Motion.) Finally, defendant seeks to strike plaintiffs' request for attorney's fees under section 2699 because PAGA was not effective until after defendant's contract with SDMTS had expired. (Memo. ISO Motion, 6.)

  DISCUSSION

  A. Legal Standard

  Rule 12(f) provides that a court "may order stricken from any pleading . . . any redundant, immaterial, impertinent, or scandalous matter." Fed.R.Civ.P. 12(f). The Ninth Circuit has stated that "[t]he function of a 12(f) motion to strike is to avoid the expenditure of time and money that must arise from litigating spurious issues by dispensing with those issues prior to trial." Fantasy Inc. v. Fogerty, 984 F.2d 1524, 1527, rev'd on other grounds, 510 U.S. 517 (1994). For example, "immaterial" matter is that which "has no essential or important relationship to the claim for relief or the defenses being pleaded." Id. (citing 5 Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure § 1382, at 706-07 (1990)). Additionally, "impertinent" matter includes "statements that do not pertain, and are not necessary, to the issues in question." Id. "Motions to strike are generally viewed with disfavor and are not frequently granted . . . unless it is clear that the matter to be stricken could have no possible bearing on the subject matter of the litigation." Bassiri v. Xerox Corp., 292 F.Supp.2d 1212, 1219-20 (C.D. Cal. 2003) (internal quotations and citations omitted).

  B. Section 226.7 Provides for the Recovery of Wages, not "Penalties"

  California Labor Code § 226.7 provides:
(a) No employer shall require any employee to work during any meal or rest period mandated by an applicable order of the Industrial Welfare Commission.
(b) If an employer fails to provide an employee a meal period or rest period in accordance with an applicable order of the Industrial Welfare Commission, the employer shall pay the employee on additional hour of pay at the employee's regular rate of compensation for each work day that the meal or rest period is not provided.
  Plaintiffs complain that defendant has violated Wage Order 9 of the Industrial Welfare Commission and seek to recover the corresponding "additional hour of pay" for each day that defendant allegedly violated the Wage Order. (Compl. ¶ 25.) Pointing to text, case law, legislative history*fn2 and a recent proposed regulation by the Division of Labor Standards Enforcement, defendant argues that section 226.7 provides for recovery of a penalty rather than a wage and, therefore, is subject to California Code of Civil Procedure § 340's one-year statute of limitations. Plaintiffs contest each of defendant's points, arguing that section 226.7 provides for the recovery of a legislatively determined wage for employees' break or meal period akin to overtime. For the following reasons, the Court finds that section 226.7 provides for the recovery of a wage.

  In California, a "penalty" includes any law compelling a defendant to pay a plaintiff other than what is necessary to compensate him for a legal damage done him by the former. Miller v. Municipal Court of City of Los Angeles, 22 Cal.2d 818, 837 (Cal. 1943); People ex rel. Dept. of Conservation v. Triplett, 48 Cal. App.4th 233, 252 (Cal.Ct.App. 1996).

  Defendant argues that section 226.7 meets the definition for a penalty because it forces employers who do not provide meal or rest periods to pay an hour of pay in addition to the wage paid employees for time worked. (Memo. ISO Motion, 4.) For example, an employee who works through a thirty minute meal period ...


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