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Ramirez-Duenas v. VF Outdoor, LLC

United States District Court, E.D. California

April 24, 2017

HUGO RAMIREZ-DUENAS, as an individual and on behalf of all others similarly situated, Plaintiff,
v.
VF OUTDOOR, LLC, a Delaware limited liability company; and DOES 1 through 100, Defendant.

          ORDER REQUIRING DEFENDANT TO EITHER SUBMIT ADDITIONAL BRIEFING AND EVIDENCE OR TO DECLINE TO DO SO. (DOC. 8).

         I. Introduction

         Plaintiff Hugo Ramirez-Duenas (“Plaintiff”) brings this putative class action on behalf of himself and fellow employees alleging various violations of the California Labor Code by their employer, Defendant VF Outdoor, LLC (“Defendant”). This action was originally filed in the Tulare County Superior Court on December 7, 2016. Doc. 1-1, Complaint (“Compl.”) at 3. Defendant removed the action on February 2, 2017, contending that this Court has jurisdiction pursuant to the Class Action Fairness Act, 28 U.S.C. § 1332(d) (“CAFA”), because (1) it involves 100 or more putative class members, (2) minimal diversity exits between the parties, and (3) the amount in controversy exceeds $5 million. Plaintiff moves to remand, arguing only that the amount in controversy does not exceed $5 million.

         For the following reasons, resolution of Plaintiff's motion to remand will be delayed pending Defendant's submission of notice of intent to submit supplemental briefing and evidence or notice of intent not to do so.

         II. Background

         Plaintiff and the putative class are a group[1] California non-exempt employees who worked in Defendant's warehouse between December 7, 2012 to present. Plaintiff's claims arise from three factual allegations: (1) Defendant “incorrectly listed many rates of pay as ‘0.00'” in wage statements, (2) Plaintiff and class members often worked more than 40 hours per week and were not correctly paid overtime wages, and (3) Plaintiff and class members “for at least a portion of the liability period” were paid “meal period premium payments in increments of one-half one hour” rather than one additional hour of pay as required by California Labor Code section 226.7. Compl. at ¶¶ 10-12. As a result of those underlying factual allegations, Plaintiff has alleged five causes of action: wage statement violations, failure to pay all overtime wages, meal period violations, waiting time penalties, and violations of California's unfair competition law (“UCL”).

         Based on those allegations, Plaintiff sets out four subclasses: a wage statement subclass, an overtime subclass, a meal period subclass, and a waiting time subclass. Defendant estimated the amount in controversy at issue for each subclass and the likely recoverable about of attorney fees:

Claim

Amount in Controversy

Wage Statement Violations

$560, 500

Failure to Pay All Overtime Wages

$1, 176, 140

Failure to Pay All Meal Period Premium Pay

$1, 852, 420

Waiting Time Penalties

$1, 010, 520

Attorneys' Fees

$1, 149, 895

Total

$5, 749, 475

         Plaintiff takes issue with the calculation of the meal period premium pay.[2] Defendant calculated the amount in controversy regarding the meal period subclass as follows: Defendant noted that Plaintiff alleged that he was “paid meal period premium pay in only half of an hour increments [rather than] a full hour of pay as required by [California] Labor Code section 226.7.” Doc. 1 at 9. Accordingly, Defendant set out to calculate the remainder due under Labor Code section 226.7 by calculating using half of the present minimum wage, to wit, $5.25 per hour. Defendant went on to “assume … that each putative class member failed to be provided with a compliant meal period at least three times per week.” Id. Next, Defendant calculated that the class period lasted 217 weeks. Finally, because Defendant employed an average of approximately 542 workers (although the actual number seems to have varied greatly) it used that number in the calculation. In sum, Defendant's calculation was $5.25 per hour * three occurrences per week * 217 weeks *542 employees, for an amount in controversy for this claim of $1, 852, 420.

         III. Legal Standard

         Federal courts are courts of limited jurisdiction. See Gunn v. Minton, ___U.S.___, 133 S.Ct. 1059, 1064 (2013). An action may only be removed to federal court if the court has original jurisdiction over the action. 28 U.S.C. § 1441. CAFA confers original federal diversity jurisdiction over putative class actions where (1) the amount in controversy exceeds $5, 000, 000, (2) the number of putative class member is not less than 100, and (3) any class member is a citizen of a different state as any defendant. 28 U.S.C. § 1332(d)(2), (5)(B); Dart Cherokee Basin Operating Co., LLC v. Owens, ___U.S. ___, 135 S.Ct. 547, 551 (2014).

         “To remove a case from state court to federal court, a defendant must file in the federal forum a notice of removal ‘containing a short and plain statement of the grounds for removal.'” Dart, 135 S.Ct. at 551 (quoting 28 U.S.C. § 1446(a)). As with any other removal, “under CAFA[, ] the burden of establishing removal jurisdiction remains … on the proponent of federal jurisdiction.” Abrego Abrego v. The Dow Chem. Co., 443 F.3d 676, 685 (9th Cir.2006) (per curiam); accord Washington v. Chimei Innolux Corp, 659 F.3d 842 (9th Cir. 2011). “A defendant's amount-in-controversy allegation should be accepted when not contested by the plaintiff or questioned by the court.” Dart, 135 S.Ct. at 553. The notice of removal may rely on the allegations of the complaint and need not be accompanied by any extrinsic evidence. Id.; Ibarra v. Manheim Investments, LLC¸ 775 F.3d 1193, 1197 (9th Cir. 2015).

         However, if a plaintiff challenges a defendant's CAFA-premised removal, “both sides submit proof and the court decides, by a preponderance of the evidence, whether the amount-in-controversy requirement has been satisfied.” Dart, 135 S.Ct. at 551; Ibarra, 775 F.3d at 1197 (“The parties may submit evidence outside the complaint, including affidavits or declarations, or other ‘summary-judgment-type evidence relevant to the amount in controversy at the time of removal.'”) If the proponent of federal jurisdiction cannot show by a preponderance of the evidence that the amount-in-controversy exceeds the $5, 000, 000 threshold, the court is without CAFA jurisdiction. 28 U.S.C. § 1332(d)(2). “If at any time before final judgment it appears that the district court lacks subject matter jurisdiction” the court must remand the action. 28 U.S.C. § 1447(c).

         IV. Discussion

         Plaintiff takes issue with three portions of Defendant's meal period claim calculation: (1) Defendant assumed a violation rate without any evidence to support its assumption, (2) Defendant's amount in controversy calculation was premised upon the total number of possible meal period violations (based on the assumed violation rate) rather than the number of unpaid meal period premiums owed, and (3) Defendant based its ...


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