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Horton v. NeoStrata Co. Inc.

United States District Court, S.D. California

March 8, 2017

CANDLE HORTON, KIMBERLEE WINSTON, and JEANETTE ZDANEK, individually and on behalf of themselves and others similarly situated, Plaintiffs,
NEOSTRATA COMPANY INC., a Delaware corporation; 24 SEVEN INC., a New York Corporation; 24 SEVEN EMPLOYMENT INC., a New York corporation, ET. AL., Defendants.


          Hon. Anthony J. Battaglia United States District Judge.

         Presently before the Court is Defendant NeoStrata Company Inc.'s (“Defendant NeoStrata”) motion to dismiss Candle Horton, Kimberlee Winston, and Jeanette Zdanek's (collectively referred to as “Plaintiffs”) second amended complaint (“SAC”) or strike portions thereof. (Doc. No. 38.) On January 11, 2017, Plaintiffs filed an opposition, (Doc. No. 43), and on January 18, 2017, Defendant NeoStrata replied. (Doc. No. 44.) Having reviewed the parties' arguments and controlling legal authority and pursuant to Civil Local Rule 7.1.d.1, the Court finds the matter suitable for decision on the papers and without oral argument. Accordingly, the motion hearing set for February 16, 2017, is hereby vacated. For the reasons set forth below, the Court GRANTS Defendant NeoStrata's motion to dismiss Plaintiffs' SAC.


         The following facts are taken from the SAC and construed as true for the limited purpose of resolving the instant motion. See Brown v. Elec. Arts, Inc., 724 F.3d 1235, 1247 (9th Cir. 2013).

         Plaintiffs, on behalf of themselves and all class members, brought a suit against Defendant NeoStrata and 24 Seven Defendants. (Doc. No. 36.) Six Defendants comprise “24 Seven Defendants”: 24 Seven LLC, 24 Seven Employment Inc., 24 Seven Staffing LLC, 24 Seven Talent California LLC DBA 24 Seven Creative Solutions, 24 Seven Recruiting LLC, and Celeste Gudas. (Id. ¶ 26.) Defendant 24 Seven LLC provides temporary labor to Defendant NeoStrata. (Id. ¶ 3.) Defendant NeoStrata “employ[s] thousands of nonexempt employees, including the named Plaintiffs, in California to sell its skincare products.” (Id. ¶ 4.) The specific roles of the other parties included in “24 SEVEN Defendants” are unclear. (See Id. ¶¶ 18-29.)

         On or about October 1, 2015, Tim Dunn, the San Diego Account Executive for “Exuviance Skincare, ” a product owned and sold by Defendant NeoStrata, asked Plaintiff Horton to join his sales team. (Id. ¶¶ 47-49.) Plaintiff Horton was asked to sell Exuviance products as a non-exempt Freelance Beauty Advisor and be paid $25 an hour regardless of her sales. (Id. ¶¶ 49, 50.) Mr. Dunn also informed Plaintiff Horton that she would report to him for work assignments, be required to travel using her personal vehicle, and have to sell Exuviance products exclusively. (Id. ¶ 51.) Plaintiff Horton accepted the job and worked selling Exuviance until she was let go on December 18, 2015. (Id. ¶¶ 53, 66.) Similarly, Plaintiff Winston sold Exuviance products for Defendant NeoStrata starting on October 17, 2015, until she was terminated on April 13, 2016, and Plaintiff Zdanek started work with Defendant NeoStrata on November 1, 2015, till January 30, 2016, when she was likewise terminated. (Id. ¶¶ 54, 58, 67, 68.)

         Plaintiffs contend that Defendant NeoStrata and 24 Seven Defendants required Plaintiffs, and other similarly aggrieved employees, to travel to more than one work site in the same day in their personal vehicles without compensation for their travel time, parking, or mileage. (Id. ¶¶ 76, 80, 88, 90, 106.) Additionally, Plaintiffs claim that Defendant NeoStrata and 24 Seven Defendants required Plaintiffs to attend weekly 30-minute phone calls, work from home, and use their personal computers, cellphones, and home internet, all without compensation. (Id. ¶¶ 99, 104-106.) Lastly, Plaintiffs attest that upon their termination, Defendant NeoStrata and 24 Seven Defendants failed to pay Plaintiffs their final paycheck in a timely manner. (Id. ¶ 123.)

         On July 20, 2016, Plaintiff Horton first filed a complaint in the Superior Court of California, San Diego County. (Doc. No. 1-2.) On August 29, 2016, 24 Seven Defendants removed Plaintiff Horton's Complaint to this Court. (Doc. No. 1 at 1.)[1] On September 2, 2016, Defendant NeoStrata filed a motion to dismiss or strike portions of Plaintiff Horton's Complaint. (Doc. No. 8.) On September 15, 2016, Plaintiff Horton filed her first amended complaint (“FAC”). (Doc. No. 15.) On September 29, 2016, Defendant NeoStrata filed its second motion to dismiss, (Doc. No. 19), which was granted on November 22, 2016. (Doc. No. 30.)

         On December 12, 2016, Plaintiff Horton, along with added Plaintiffs Winston and Zdanek, filed their SAC. (Doc. No. 36.) Plaintiffs' SAC alleges causes of action for: (1) Failure to Pay State Overtime Wages; (2) Failure to Pay State Minimum/Regular Wages; (3) Failure to Make Payments Within the Required Time; (4) Violation of Labor Code § 226; (5) Failure to Maintain Required Records in Violation of California Labor Code § 1174; (6) Failure to Indemnify/Reimburse Business Expenses in Violation of California Labor Code § 2802; (7) Remedies Under Private Attorney General Act (PAGA California Labor Code §§ 2698, 2699); and (8) Unfair Business Practices in Violation of California Business and Professional Code §§ 1700 and 17200.[2] (See generally Doc. No. 36.) On December 20, 2016, Defendant NeoStrata filed the present motion to dismiss. (Doc. No. 38.)


         A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of a plaintiff's complaint. See Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). “[A] court may dismiss a complaint as a matter of law for (1) lack of cognizable legal theory or (2) insufficient facts under a cognizable legal claim.” SmileCare Dental Grp. v. Delta Dental Plan of Cal., 88 F.3d 780, 783 (9th Cir. 1996) (citation omitted). However, a complaint will survive a motion to dismiss if it contains “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). In making this determination, a court reviews the contents of the complaint, accepting all factual allegations as true and drawing all reasonable inferences in favor of the nonmoving party. See Cedars-Sinai Med. Ctr. v. Nat'l League of Postmasters of U.S., 497 F.3d 972, 975 (9th Cir. 2007).

         Notwithstanding this deference, the reviewing court need not accept legal conclusions as true. See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). It is also improper for a court to assume “the [plaintiff] can prove facts that [he or she] has not alleged.” Assoc. Gen. Contractors of Cal., Inc. v. Cal. State Council of Carpenters, 459 U.S. 519, 526 (1983). However, “[w]hen there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief.” Iqbal, 556 U.S. at 664.


         Defendant NeoStrata argues that Plaintiffs' SAC should be dismissed in its entirety because Plaintiffs fail to plead plausible facts beyond the mere conclusory and impermissibly lumps Defendant NeoStrata and 24 Seven Defendants together. (Doc. No. 38-1 at 9.) Defendant NeoStrata also contends that Plaintiffs have not set forth any new factual allegations in the SAC that would plausibly plead that Defendant NeoStrata is liable with 24 Seven Defendants under theories of alter ego, agency, integrated enterprise, or joint venture. (Id. at 22.)

         In direct contrast, Plaintiffs assert that the written agreement[3], and the emails sent between Defendant NeoStrata's management and Plaintiffs, all clearly demonstrate that Defendant NeoStrata is a joint employer as established by California Labor Code § 2810.3. (Doc. No. 43 at 12-13.) However, Plaintiffs' Opposition is devoid of any arguments to contest Defendant NeoStrata's assertions that no liability exists under theories of agency, joint venture, alter ego, or integrated enterprise. (See generally Doc. No. 43.) For the reasons set forth more fully below, the Court GRANTS Defendant NeoStrata's motion to dismiss Plaintiffs' SAC.

         A. Plaintiffs Addition of Two New Plaintiffs and a New Theory of Liability Complied with ...

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