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Johnson v. Serenity Transportation, Inc.

United States District Court, N.D. California

April 14, 2017

CURTIS JOHNSON, et al., Plaintiffs,
v.
SERENITY TRANSPORTATION, INC., et al., Defendants.

          ORDER RE: MOTIONS FOR SUMMARY JUDGMENT Re Dkt. Nos. 124, 126, 153

          JACQUELINE SCOTT CORLEY United States Magistrate Judge

         Plaintiffs, removal technicians, allege that they and other Serenity Transportation, Inc. removal technicians were misclassified by Serenity as independent contractors instead of employees and thus denied the benefits of California and federal wage-and-hour laws. Apparently believing that Serenity may not be able to satisfy a judgment, they have also sued three entities for whom the Serenity removal technicians performed services on the theory that they are the removal technicians' joint employers and thus jointly and severally liable for Serenity's wage and hour violations. (Dkt. No. 121.[1]) Now pending before the Court are these entities' motions for partial summary judgment on whether they are subject to liability as Plaintiffs' joint employers along with Serenity. (Dkt. Nos. 124, 126.) Plaintiffs have also filed an administrative motion to file under seal certain documents submitted in support of their opposition to Defendants' motions. (Dkt. No. 153.) Having considered the parties' submissions, and having had the benefit of oral argument on January 19, 2016, the Court GRANTS IN PART SCI's motion, GRANTS the County's motion, and GRANTS Plaintiffs' sealing request.

         BACKGROUND

         I. Factual Summary

         A. Serenity Transportation

         Plaintiffs Curt Johnson and Gary Johnson are removal technicians, also known as mortuary drivers, who are responsible for picking up and transporting dead bodies from the place of death-including residences, hospitals, convalescent homes, or accident and crime scenes-to designated locations-typically the morgue, a mortuary, or a funeral home storage facility. Generally, their responsibilities include remaining on call to receive assignments, wrapping the bodies in plastic sheets, transporting the bodies, and positioning the bodies at the destination. (Dkt. No. 154-2 ¶ 3; Dkt. No. 154-3 ¶ 3; Dkt. No. 154-4 ¶ 3.)

         Plaintiffs worked as removal technicians for Serenity, a California mortuary transportation service owned by David Friedel. Serenity refers to itself as a “referral service” that connects its clients with removal technicians. Curt Johnson worked for Serenity from January 2012 to August 2013. Gary Johnson worked for Serenity from February 2015 until April 2016. The contracts between Serenity and its technicians are all substantially similar, and classify the removal technicians as “independent contractors.” Removal technicians lease their vehicles and gurneys from Serenity and complete four to eight removals per day for various clients. Serenity removal technicians may attend a removal as either the lead-the primary removal technician-or the assist, who does not usually accompany the decedent into the client's facility. Removal technicians serve as lead instead of assist, and vice versa, on about half of their calls. They are paid on a flat fee basis per delivery with expense reimbursement for trips over 30 miles and additional reimbursement for excessive wait times. Serenity removal technicians are assigned removal calls through Serenity's dispatch.

         B. SCI

         SCI and its affiliates own and operate funeral homes, cemeteries, crematories, and facilities known as “Personal Care Centers” (“Care Centers”) where remains are prepared for final disposition, and holding facilities where remains are stored temporarily.[2] At its Care Centers and holding facilities SCI employs staff who-among other duties-drive and perform removal services. However, SCI has contracted with Serenity for removal technicians since 2011 because it “wanted to have an option if [they] were unable to do the removal services with [their] own staff.” (Dkt. No. 156-9 at 9.) Serenity picked up decedents outside of business hours when SCI's rotating after-hours on-call employees are unavailable or do not want to take the after-hours assignment, or during regular business hours when SCI's employees are otherwise too busy. Unlike SCI's staff, Serenity removal technicians only perform removal services and no other tasks.

         SCI has contracted with Serenity to provide removal services as needed since 2011. The contracts are non-exclusive-i.e., SCI can use other third-party vendors to find removal technicians-and designated the Serenity removal technicians independent contractors; however, some SCI affiliates use only Serenity and no other third party vendors. Serenity performs the removal services in exchange for a flat fee.

         Summaries of removal technicians' call sheets reflect that SCI calls accounted for less than 20% of the removals plaintiff Curt Johnson and Gary Johnson performed for Serenity in 2015 and 2016.

         C. The County

         The County, through the Office of the Medical Examiner Coroner (“Coroner”), is responsible for determining the cause and manner of death for certain decedents in the County. A police department or hospital typically notifies the Coroner of a decedent, and the Coroner assigns an investigator to the case who determines whether the Coroner must determine the cause and manner of death pursuant to state statute. After the investigator obtains evidence at the scene of the death, he arranges for transportation to the Coroner's office. Unlike SCI, the County “does not have employees whose job duty it is to transport decedents to the Coroner's office.” (Dkt. No. 131 ¶ 3.) Instead, the County contracts with Serenity to transport decedents to the Coroner's Office. Sometimes, however, County investigators assist removal technicians with removals. The County has contracted with Serenity to provide removal services since 2011. While the contract is non-exclusive, Serenity has been the County's exclusive removal services provider since 2011. Serenity performs removal services in exchange for a flat fee that varies according to job type and location.

         Of the 1059 deliveries that Curt Johnson completed for Serenity in 2012, 299-28%- were for the County. During Gary Johnson's entire tenure with Serenity, he completed only one delivery for the County.

         II. Procedural History

         The Court's prior orders have extensively detailed the procedural history of this case, which the Court will not reiterate here. (See Dkt. Nos. 57, 69.) But the Court's order denying Defendants' motion to dismiss the Fourth Amended Complaint is relevant here and bears repeating. (Dkt. No. 69.) There, the Court concluded that the Fourth Amended Complaint adequately stated a claim against the SCI entities for Section 2810.3 liability. (Id. at 16.) The Court also held that Plaintiffs had “allege[d] just enough to eke out a plausible inference of joint employment for the SCI entities and the County” under federal law (Dkt. No. 69 at 25), and adequately alleged a plausible basis for the SCI entities' joint employer liability under California law (id. at 31). Plaintiffs then filed the now-operative Fifth Amended Complaint, which did not add any substantive allegations but substituted Gary as a named plaintiff and proposed class representative for Anthony Aranda. (See Dkt. No. 119 at 3; Dkt. No. 121.) Both SCI and the County now move for summary judgment on the grounds that they are not the removal technicians' joint employers under federal law or-with respect to SCI only-under California law or for purposes of Section 2810.3 liability. (Dkt. Nos. 124, 126.)

         DISCUSSION

         I. Evidentiary Objections

         Both Plaintiffs and Defendants have objected to evidence submitted in connection with briefing the motions for partial summary judgment. (See Dkt. Nos. 161, 167, 168, 169.)

         SCI objects to the Court's consideration of the Serenity removal technicians' statements about the number of calls they completed per day on the grounds that their testimony “is directly contradicted by the evidence”; namely, the call sheets. (See Dkt. No. 161 at 9-11; see also Dkt. No. 166 ¶¶ 9-15.) Defendants cite no evidentiary rule to exclude the testimony. The Court will consider the removal technicians' declarations over Defendants' objection.

         SCI objects to Paragraph 3 of the declaration of Serenity removal technician Mario Almanza (Dkt. No. 156-65 ¶ 3) on the grounds that Almanza's statements about what Friedel told him-namely, that one of Serenity's mortuary clients was upset that he had fallen asleep on the job-are inadmissible hearsay. (Dkt. No. 161 at 10.) The Court overrules the objection, as Friedel's out-of-court statement is not hearsay but rather a statement of a party opponent under Federal Rule of Evidence 801(d)(2).

         SCI objects to the Court's consideration of Paragraph 11 of the declaration of John Lundholm and Paragraph 15 of the declaration of Jeremy Jukich on the grounds that their statement that Friedel instructed them to pass out business cards on SCI calls are inadmissible hearsay. (Dkt. No. 161 at 10; Dkt. No. 167 at 8.) The Court will consider Paragraph 11, as Friedel's out-of-court statement is not hearsay under Rule 801(d)(2) but rather a statement by a party opponent.

         SCI objects to the removal technicians' statements about what paperwork Serenity's other mortuary clients require for lack of foundation and lack of personal knowledge. (Dkt. No. 161 at 10.) There is evidence in the record that SCI was just one of Serenity's mortuary clients for which the technicians performed removal work, which is enough to demonstrate their familiarity with other mortuaries' practices. The Court therefore considers the removal technicians' statements over Defendants' objection.

         SCI also objects to Paragraph 17 of Curt's declaration on the grounds that his statements are “not specific to the SCI Defendants or the joint employer issue.” (Dkt. No. 161 at 10.) In Paragraph 17, Curt describes taking direction and instructions directly from County investigators while performing removals. (Dkt. No. 156-7 ¶ 17.) The County's control and supervision over removal technicians is relevant to the joint employer issue, so the Court considers the statement only with respect to the County, not SCI.

         The County objects to Paragraph 12 of Gary Johnson's declaration on the grounds that it is improper in form, lacks foundation and personal knowledge, and is inadmissible hearsay. (Dkt. No. 167 at 7.) The Court relies on Paragraph 12 solely for purposes of acknowledging Gary's statement that he remembered performing a removal for the County on one occasion. The County's objections are without merit as to this statement.

         The County objects to Paragraph 3 of the declaration of Tony Goulart-in which he describes an incident where he was disciplined by the County for handing out personal business cards-on the grounds that he does not recall the name of the captain, the date, or any other details about the incident. (Dkt. No. 167 at 7.) The date and name of the officer are irrelevant; the salient point is the discipline itself. The County also objects to this paragraph as inadmissible hearsay. (Id.) The Court sustains the objection as to Mr. Goulart's explanation of what the officer told him at the meeting, but overrules the objection as to Mr. Goulart's overall explanation of the event- i.e., that the meeting occurred, the reason for the meeting (his handing out business cards), and the ultimate result (his suspension from County and Serenity calls).

         Plaintiffs object to Paragraph 3 of the declaration of Jeffrey Hubins submitted in support of the County's reply (Dkt. No. 167-1), which describes an administrative case against one Serenity removal technician, on the grounds that it contains improper argument and conclusions, hearsay, violates the best evidence rule, lacks foundation, contains improper opinion testimony, is irrelevant, and is more prejudicial than probative. (Dkt. No. 168.) The Court sustains the objection.

         Plaintiffs object to Paragraph 3 of the declaration of David Friedel submitted in support of SCI's reply (Dkt. No. 164) on the grounds that it lacks foundation, constitutes improper opinion testimony, and is speculative and not based on personal knowledge. (Dkt. No. 169 ¶ 1.) The Court sustains the objection to the extent that Friedel's explanation of the meaning of its SCI contracts is improper legal opinion.

         Plaintiffs also object to Paragraphs 7 and 8 of the declaration of Candace Shirley submitted in support of SCI's reply (Dkt. No. 166) on the grounds that it lacks foundation and is not based on personal knowledge, constitutes improper opinion testimony, and is speculative. (Dkt. No. 169 ¶ 2.) The Court does not consider this evidence so the objection is moot. Plaintiffs further object to Paragraphs 6 and 9 through 16-both Paragraphs 16, as there are two-on the grounds that the testimony contains improper argument and conclusions and hearsay, violates the best evidence rule, lacks foundation, and contains improper opinion testimony. (Id.) The Court agrees and sustains the objection.

         The Court overrules the remaining objections.

         II. Joint Employer Status

         The joint employer doctrine recognizes that “even where business entities are separate, if they share control of the terms of conditions of an individual's employment, both companies can qualify as employers.” Guitierrez v. Carter Bros. Sec. Servs., LLC, No. 2:14-cv-00351-MCE-CKD, 2014 WL 5487793, at *3 (E.D. Cal. Oct. 29, 2014) (citing Real v. Driscoll Strawberry Assocs., Inc., 603 F.2d 748, 769-60 (9th Cir. 1979)). Defendants seek partial summary judgment that they are not the removal technicians' joint employers under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 206, and California law.

         A. Joint Employer under the FLSA

         1. Legal Standard

         A defendant must be an “employer” of the plaintiff to be liable under the FLSA. Bonnette v. Cal. Health & Welfare Agency, 704 F.2d 1465, 1470 (9th Cir. 1983), abrogated on other grounds by Garcia v. San Antonio Metro. Transit Auth., 469 U.S. 528 (1985). Two or more employers may be ‘joint employers' for the purposes of the FLSA. Maddock v. KB Homes, Inc., 631 F.Supp.2d 1226, 1232 (C.D. Cal. 2007) (citation omitted). “All joint employers are individually responsible for compliance with the FLSA.” Bonnette, 704 F.2d at 1469 (citation omitted); see also 29 C.F.R. § 791.2(a). Whether an entity is a “joint employer” under the FLSA is a question of law. Torres-Lopez v. May, 111 F.3d 633, 638 (9th Cir. 1997) (citing Bonnette, 704 F.2d at 1469).

         The “economic reality” of an employment situation determines whether an employer-employee relationship exists under the FLSA. Goldberg v. Whitaker House Coop., 366 U.S. 28, 33 (1961). The Ninth Circuit has adopted a four-part “economic reality” test to determine when the employer-employee relationship exists. See Bonnette, 704 F.2d at 1470. These factors include whether the employer: “(1) had the power to hire and fire the employees, (2) supervised and controlled employee work schedules or conditions of employment, (3) determined the rate and method of payment, and (4) maintained employment records.” Id. (citation omitted); see also Moreau v. Air France, 356 F.3d 942, 946-47 (9th Cir. 2004) (confirming applicability of the Bonnette factors for the economic reality test). In Torres-Lopez v. May, 111 F.3d 633 (9th Cir. 1997), the Ninth Circuit added to this analysis eight secondary “non-regulatory” factors that support joint employer status, including whether:

(1) the work done by the employee was analogous to a specialty job on the production line; (2) the responsibility under the contract was standard for the industry and could be passed from one contractor to another without material change and little negotiation; (3) the purported joint employer owns or has an interest in the premises and equipment used for the work; (4) the employees did not have a business organization that could shift as a unit from one worksite to another; (5) the services rendered were piecework and did not require special skill, initiative or foresight; (6) the employee did not have an opportunity for profit or loss depending upon the employee's managerial skill; (7) there was permanence in the working relationship and (8) the service rendered was an integral part of the alleged joint employer's business.[3]

Id. at 640 (citation omitted); Moreau, 356 F.3d at 947-48.

         All of these factors are meant to guide a court's analysis, but the ultimate determination must be based “upon the circumstances of the whole activity.” Rutherford Food Corp. v. McComb, 331 U.S. 722, 730 (1947); Bonnette, 704 F.2d at 1470 (“The [ ] factors . . . provide a useful framework for analysis . . . but they are not etched in stone and will not be blindly applied.”). As a result, summary judgment may be proper even when some factors favor joint employment and others do not. See Moreau, 356 F.3d at 952.

         2. SCI

         a. Bonnette Factors

         i. power to hire and fire

         The first Bonnette factor, whether the alleged joint employer has the power to hire and fire the purported employees, weighs against joint employment. It is undisputed that SCI does not post available Serenity removal technician jobs, review resumes or applications, or interview candidates, and it is not involved in drafting, approving, or executing contracts between Serenity and the removal technicians. Instead, Serenity alone, largely via Friedel, takes responsibility for all of these actions. That “SCI's agreements with Serenity are non-exclusive; [and] SCI can choose to assign work to its own personnel, Serenity removal technicians, or non-Serenity removal technicians[, ]” (Dkt. No. 156 at 19) does not create a genuine dispute as to whether SCI has the power to hire Serenity removal technicians. This evidence addresses whether a Serenity removal technicians will perform work for SCI, not whether the individual will be hired as a Serenity removal technician in the first instance. Thus, it is undisputed that Serenity alone hires the removal technicians. See Montoya v. 3PD, Inc., No. CV-13-8068-PCT-SMM, 2014 WL 3385116, at *3 (D. Ariz. July 10, 2014) (finding no power to hire where the alleged joint employer did not meet the worker until after he was hired and did not review application materials, even if it did require the worker to pass a background check); cf. Guifu Li v. A Perfect Day Franchise, Inc., 281 F.R.D. 373, 400 (N.D. Cal. 2012) (finding power to hire where the alleged joint employer interviewed several massage therapists before they were hired, and told several massage therapists that before they would be hired they would have to complete certain training by the employer).

         Plaintiffs nonetheless insist that a trier of fact could find that SCI has the power to fire Serenity removal technicians. While it is undisputed that the SCI-Serenity contracts do not grant SCI authority to terminate a removal technician from Serenity altogether or to bar a technician from performing any removals for SCI, the record supports a finding that SCI has the authority to remove a Serenity removal technicians from the SCI rotation; indeed, Friedel testified that several SCI mortuaries made such requests. (Dkt. No. 156-8 at 15-16; Dkt. No. 156-50.) This evidence, however, does not support a reasonable inference that SCI has the power to fire Serenity removal technicians. An entity's right to remove particular workers from its rotation is not the same as power to fire a worker from the labor contractor itself. See, e.g., Montoya, 2014 WL 3385116, at *4 (“Although Home Depot may have requested that 3PD remove Montoya as a delivery driver of Home Depot goods, it remained 3PD's decision whether to continue its relationship with Montoya. Even if Home Depot indirectly contributed to the termination of 3PD's relationship with Montoya, it is not enough to suggest that as a matter of law Home Depot had the power to . . . fire Montoya.”); Adams v. U.S. Airways, Inc., No. CIV 10-1088-PHX-DKD, 2013 WL 1345509, at *3 (D. Ariz. Mar. 29, 2013) (defendant's request that a worker stop providing services to its customer did not constitute ability to fire); Valdez v. Cox Commc'ns Las Vegas, Inc., No. 2:09-CV-01797-PMP-RJJ, 2012 WL 1203726, at *2-3 (D. Nev. Apr. 11, 2012) (finding the defendant was not a joint employer where the worker did not establish that the defendant “ordered a contractor to terminate any particular employee or that a contractor did so in response to such a command”).

         Plaintiffs' attempt to distinguish these cases on the grounds that Friedel's emails support a finding that Friedel terminated Serenity workers at SCI's request is unavailing. At oral argument Plaintiffs identified Exhibit 53 to their opposition as an example. That email and others demonstrate that Serenity terminated a removal technician for violating an SCI policy by having two bodies in the vehicle at one time and consequently placing the wrong identification band on one of the deceased. Friedel warned that the removal technicians had been instructed to place the identification bands on at the time of removal and he threatened termination from Serenity if removal technicians fail to follow this policy. (See Dkt. Nos. 156-53, 156-54, 156-55.) But nothing in any of the emails indicates that SCI required Serenity to terminate the technician from Serenity, or retained authority to require Serenity to do so, or even asked that Serenity do so. And given the seriousness of the error, that Serenity terminated the removal technicians does not support an inference that SCI dictated such a consequence. Serenity's termination of a removal technicians who fell asleep on the job during an SCI call (Dkt. No. 156-65 ¶ 3), also does not support a reasonable inference that SCI directed Serenity to fire that employee or even asked that Serenity do so.

         Trying a different tack, Plaintiffs contend that SCI's role as one of Serenity's largest customers coupled with SCI's ability to remove removal technicians from its rotation is enough to establish a genuine dispute about SCI's power to fire Serenity technicians. An alleged joint employer's right to remove workers from a jobsite may be tantamount to the right to fire where the alleged joint employer's jobs constitute all or the vast majority of the contractor's work. See, e.g., Perez, 2015 WL 3451268, at *6 (where workers performed all work for alleged joint employer pursuant to an exclusivity contract between the labor contractor and alleged joint employer, removal from the joint employer was equivalent to firing) (citation omitted); Valdez, 2012 WL 1203726, at *2 (finding that if defendant decided that a worker could not work on its assignments, that meant termination from the contractor because the contractor obtained 100% of its work for defendant); Lemus v. Timberland Apts., LLC, No. 3:10-CV-01071-PK, 2011 WL 7069078, at *10 (D. Or. Dec. 21, 2011), report & recommendation adopted, 2012 WL 174787 (D. Or. Jan. 20, 2012) (concluding that plaintiff had stated a claim for power to fire based on allegations that the defendant had the right to remove a worker from its worksite and the contractor performed a majority of its work for the defendant). Here, however, while SCI may be one of Serenity's largest customers, there is no evidence that SCI calls constituted all or even a majority of Serenity's removals. Instead, in 2015 SCI removals constituted less than 15 percent of all Serenity removals, and between 2012 and 2016 SCI removals accounted for between 8.6 and 13.8% of Serenity's total gross revenue. (Dkt. No. 124-8 ¶ 34.) In light of this evidence, coupled with the lack of any evidence that Serenity actually fired any removal technicians because SCI asked that they not perform Serenity removals for SCI, even drawing all inferences in Plaintiffs' favor, a Serenity removal technician's removal from SCI's rotation is not tantamount to termination from Serenity; such removal technician would still be able to respond to 85% of Serenity's calls and the vast majority of its revenue-generating calls.[4]

         Plaintiffs' reliance on Carrillo v. Schneider Logistics Trans-Loading & Distribution, Inc. (“Carrillo/SLTD”), No. 2:11-CV-8557-CAS, 2014 WL 183965 (C.D. Cal. Jan. 14, 2014), is unpersuasive. There the evidence supported a finding that the contract between the alleged joint employer and contractor gave the joint employer the authority to remove the contractor's employees from the joint employer's warehouse and from their assignment with the joint employer; that the joint employer exercised this authority on multiple occasions; and that the contractor thereafter terminated the employment of at least some of the removed employees following the joint employer's request that the employees be removed from the warehouse. Id. at *4. But unlike Carrillo/SLTD, here there is no evidence that Serenity fired a removal technician because SCI asked that the removal technician be removed from SCI's rotation; instead there is only evidence that Serenity heeded SCI's request to remove a removal technician from SCI's rotation temporarily (Dkt. No. 156-8 at 15-16; Dkt. No. 156-50; Dkt. No. 164 ¶ 4) and that, on other occasions, Friedel independently decided to terminate Serenity removal technicians based on mistakes made during SCI calls (Dkt. No. 156-51; Dkt. No. 156-52; Dkt. No. 156-54; Dkt. No. 156-65 ¶ 3.) This does not create a genuine dispute of material fact about SCI's power to fire Serenity removal technicians.

         ii. control over the employees' work schedules or conditions

         The second Bonnette factor is whether the alleged joint employer has control over the employees' work schedules or conditions. The evidence does not support a finding that SCI has control over the removal technicians' overall work schedules. While SCI requires Serenity to provide a certain number of removal technicians on a 24-hour basis, only Serenity, through Friedel, sets the removal technicians' schedules by determining which four or five days per week the removal technicians will be on 24-hour call and grants or denies removal technicians' requests for time off. Put another way, while SCI requires 24-hour coverage, Serenity can staff its removal technicians however it sees fit. At oral argument, Plaintiffs conceded that they could not cite a case that holds that requiring a certain number of workers or requiring coverage for a certain amount of time indicates control. Moreover, when removal technicians are on call, Serenity also retains exclusive authority to decide which removal technician to assign to which call and to determine which removal technician will serve as lead versus assist, if the call requires two people. While there is evidence that SCI requested particular removal technicians on occasion, the record does not support a finding that any removal technicians ever responded to a call without an instruction from Serenity's dispatch, which indicates that SCI has no authority to assign removal technicians to calls. In sum, there is no evidence that suggests SCI had any control over which removal technicians would be on call, when, or for how long. Thus, SCI does not have control over removal technicians' work schedules.

         However, the evidence supports a finding that SCI imposes a number of rules regarding the removal technicians' work conditions and daily job functions when they respond to SCI calls. SCI promulgated policies for the removal technicians' work that detailed requirements for timing in responding to calls, including making certain representations to the decedent's family, a specific way of placing identification bands on the decedent, requiring the removal technicians to ensure there is a non-employee witness to the removal, limiting removal technicians to delivering only one decedent at a time, completing certain paperwork about the removal and the decedent's personal property, and depositing the body at the SCI Care Center in a particular way. SCI reviews the removal technicians' paperwork and requires them to fix any errors that it finds. There is also evidence that SCI's work rules were more extensive than the requirements other mortuaries imposed on Serenity removal technicians. Although SCI did not invite or require removal technicians' attendance, Serenity technicians' attended live training sessions at SCI on several occasions, and SCI gave Serenity a training DVD to show the removal technicians. SCI also provided Serenity a monthly performance review where it highlighted incidents of technician misconduct.

         The question then is whether the paperwork requirements and supervision that SCI imposes are sufficient to find “control” for the purposes of this Bonnette factor. Most of the procedures relate to identification of decedents, which SCI identified as the most important part of its business; the contracts between SCI and Serenity required Serenity to follow the procedures. SCI concedes that these are the same rules its own employees must follow when they perform removals. Nevertheless, SCI maintains that they are not evidence of control, relying on Moreau. There, the court noted that defendant Air France was “very specific about how it wanted its work performed, and it checked to ensure that its standards were met and that the service provider's overall performance adhered to Air France's specifications.” 356 F.3d at 951. The Ninth Circuit acknowledged that “[t]his type of activity can, in some situations, constitute ‘indirect' supervision of the employees' performance” but concluded that such was not the case there, where “much of the indirect supervision or control [it exercised] over the ground handling employees was purportedly to ensure compliance with various safety and security regulations, such as ensuring that food equipment was properly stowed or that the plane's load was adequately balanced.” Id. Following Moreau, courts have recognized that “compliance with legal requirements is not indicative of control for purposes of establishing an employer-employee relationship.” Taylor v. Waddell & Reed Inc., No. 09CV2909 DMS (WVG), 2010 WL 3212136, at *3 (S.D. Cal. Aug. 12, 2010). However, courts have applied the Moreau principle “in a narrow and limited way”-that is, only when the regulation sets forth a particular method of action and the entity complies with that method. See Waddell, 2010 WL 3212136, at *3 (citations omitted); see, e.g., Zhao v. Bebe Stores, Inc., 247 F.Supp.2d 1154, 1160-61 (C.D. Cal. 2003) (clothing store's use of a compliance monitor to ensure garment manufacturer's compliance with labor laws that the Department of Labor requires did not indicate control for determining joint employer relationship). In ...


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