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Williams v. Superior Court (Marshalls of Ca, LLC)

Supreme Court of California

July 13, 2017


         Court: Superior County No. BC503806: Los Angeles William F. Highberger Judge.

          Capstone Law, Glenn A. Danas, Ryan Wu, Robert Drexler, Stan Karas and Liana Carter for Petitioner.

          Cohelan Khoury & Singer and Michael D. Singer for California Employment Lawyers Association as Amicus Curiae on behalf of Petitioner.

          Cynthia Rice for California Rural Legal Assistance, Inc., California Rural Legal Assistance Foundation, Legal Aid Society-Employment Law Center and National Employment Law Project as Amici Curiae on behalf of Petitioner.

          The Turley Law Firm, William Turley, David T. Mara and Jamie Serb for Consumer Attorneys of California as Amicus Curiae on behalf of Petitioner.

          Littler Mendelson, Robert G. Hulteng, Amy Todd-Gher, Kyle W. Nageotte, Joshua J. Cliffe, Emily E. O'Connor and Scott D. Helsinger for Real Party in Interest.

          Shook, Hardy & Bacon, Phil Goldberg, Christopher E. Appel and Patrick Gregory for National Association of Manufacturers, American Coatings Association and NFIB Small Business Legal Center as Amici Curiae on behalf of Real Party in Interest.

          Call & Jensen, Julie R. Trotter, Jamin S. Soderstrom and Delavan J. Dickson for Retail Litigation Center, Inc., California Retailers Association and California Grocers Association as Amici Curiae on behalf of Real Party in Interest.

          Jackson Lewis, Lisa Barnett Sween, Natalja M. Fulton, Dylan B. Carp and Douglas G.A. Johnston for Prometheus Real Estate Group, Inc., as Amicus Curiae on behalf of Real Party in Interest.

          Pahl & McCay, Stephen D. Pahl, Karen Kubala McCay and Julie Bonnel-Rogers for California Apartment Association as Amicus Curiae on behalf of Real Party in Interest.

          O'Melveny & Myers, Apalla U. Chopra, Adam J. Karr, Ryan W. Rutledge, Andrew Lichtenstein and Christina N. Pacudan for The Employers Group as Amicus Curiae on behalf of Real Party in Interest.

          Haynes and Boone, Mary-Christine Sungaila and Martin M. Ellison for International Association of Defense Counsel as Amici Curiae on behalf of Real Party in Interest.

          Werdegar, J.

         This is a representative action seeking civil penalties on behalf of the State of California and aggrieved employees statewide for alleged wage and hour violations. (See Lab. Code, § 2698 et seq., the Labor Code Private Attorneys General Act of 2004, hereafter PAGA.) In the course of discovery, plaintiff Michael Williams sought contact information for fellow California employees. When the defendant employer, Marshalls of CA, LLC, resisted, Williams filed a motion to compel. The trial court granted the motion as to the store where Williams worked, but denied it as to every other California store, conditioning any renewed motion for discovery on Williams sitting for a deposition and showing some merit to the underlying action. Williams petitioned the Court of Appeal to compel the trial court to vacate its discovery order. The Court of Appeal denied the writ, and we granted review to consider the scope of discovery available in PAGA actions.

         In the absence of privilege, the right to discovery in this state is a broad one, to be construed liberally so that parties may ascertain the strength of their case and at trial the truth may be determined. Our prior decisions and those of the Courts of Appeal firmly establish that in non-PAGA class actions, the contact information of those a plaintiff purports to represent is routinely discoverable as an essential prerequisite to effectively seeking group relief, without any requirement that the plaintiff first show good cause. Nothing in the characteristics of a PAGA suit, essentially a qui tam action filed on behalf of the state to assist it with labor law enforcement, affords a basis for restricting discovery more narrowly. Nor, on this record, do other objections interposed in the trial court support the trial court's order. We reverse.

         Factual and Procedural Background

         Marshalls of CA (Marshalls) is a retail chain with stores throughout California. Williams worked for Marshalls at its Costa Mesa store beginning in January 2012. In 2013, Williams sued Marshalls under PAGA. The operative complaint alleges Marshalls failed to provide Williams and other aggrieved employees meal and rest periods or compensation in lieu of the required breaks. (Lab. Code, §§ 226.7, 512, subd. (a).) According to the complaint, on a companywide basis, Marshalls understaffed stores, required employees to work during meal periods without compensation, and directed managers to erase meal period violations from its time records. Marshalls also adopted a “systematic, company[]wide policy” to pay no premiums for missed breaks. Relatedly, Marshalls failed to provide Williams and other aggrieved employees timely wage payment or complete and accurate wage statements. (Lab. Code, §§ 204, 226, subd. (a).) Finally, Marshalls adopted a policy and practice of requiring Williams and other aggrieved employees to carry out company business, such as bank runs and travel for training sessions, without reimbursement. (Lab. Code, §§ 2800, 2802.)

         PAGA authorizes an employee who has been the subject of particular Labor Code violations to file a representative action on behalf of himself or herself and other aggrieved employees. (Lab. Code, § 2699.) Pursuant to PAGA, Williams's complaint seeks declaratory relief and civil penalties, to be shared between Williams, other aggrieved employees, and the State of California. (Lab. Code, § 2699, subd. (i).)

         Early in discovery, Williams issued two special interrogatories asking Marshalls to supply the name, address, telephone number, and company employment history of each nonexempt California employee in the period March 2012 through February 2014, as well as the total number of such employees. Marshalls responded that there were approximately 16, 500 employees, but refused to provide their information. It contended the request for contact and employment information statewide was overbroad because it extended beyond Williams's particular store and job classification; unduly burdensome because Williams sought private information without first demonstrating he was aggrieved or that others were aggrieved; and an invasion of the privacy of third parties under California Constitution, article I, section 1. Williams moved to compel responses.

         After a hearing, the trial court granted in part and denied in part Williams's motion. The court ordered Marshalls to provide employee contact information, but only for the Costa Mesa store where Williams worked, subject to a Belaire-West[1] notice designed to ensure protection of third party privacy rights and an equal sharing of costs by the parties. For the company's other approximately 130 stores, Williams was willing to accept information from a representative sample of 10 to 20 percent of employees, but the court denied the motion to compel. The court left open the door to a renewed motion for discovery but required as a condition of any motion that Williams “appear for at least six productive hours of deposition.” Finally, the court specified that in opposing a renewed motion for discovery, Marshalls could rely on any portion of the deposition that it believed showed the complaint was substantively meritless. Recognizing the discovery motion forced it to render a decision in an uncharted area of law, the trial court certified its order for immediate review and requested appellate guidance. (See Code Civ. Proc., § 166.1.)

         Williams sought writ relief from the denial of access to employee contact information for all but one store. The Court of Appeal denied relief. It held that, as the party seeking to compel discovery, Williams must “set forth specific facts showing good cause justifying the discovery sought” (Code Civ. Proc., § 2031.310, subd. (b)(1)) but had failed to do so. In the alternative, the Court of Appeal concluded that because third party privacy interests were implicated, Williams “ ‘must demonstrate a compelling need for discovery' ” by showing “the discovery sought is directly relevant and essential to the fair resolution of the underlying lawsuit.”

         We granted review to resolve issues of first impression concerning the appropriate scope of discovery in a PAGA action.


         I. Standard of Review

         We review the trial court's grant or denial of a motion to compel discovery for an abuse of discretion. (John B. v. Superior Court (2006) 38 Cal.4th 1177, 1186.) The statutory scheme vests trial courts with “ ‘wide discretion' ” to allow or prohibit discovery. (Emerson Electric Co. v. Superior Court (1997) 16 Cal.4th 1101, 1107, quoting Greyhound Corp. v. Superior Court (1961) 56 Cal.2d 355, 378.) A circumspect approach to appellate review of discovery orders ensures an appropriate degree of trial court latitude in the exercise of that discretion.

         That deference comes with two related caveats. First, “ ‘[t]he scope of discretion always resides in the particular law being applied, i.e., in the “legal principles governing the subject of [the] action....” Action that transgresses the confines of the applicable principles of law is outside the scope of discretion and we call such action an “abuse” of discretion.' ” (Sargon Enterprises, Inc. v. University of Southern California (2012) 55 Cal.4th 747, 773.) An order that implicitly or explicitly rests on an erroneous reading of the law necessarily is an abuse of discretion. (See Haraguchi v. Superior Court (2008) 43 Cal.4th 706, 711-712 & fn. 4.)

         Second, trial courts issuing discovery orders and appellate courts reviewing those orders should do so with the prodiscovery policies of the statutory scheme firmly in mind. A trial court must be mindful of the Legislature's preference for discovery over trial by surprise, must construe the facts before it liberally in favor of discovery, may not use its discretion to extend the limits on discovery beyond those authorized by the Legislature, and should prefer partial to outright denials of discovery. (Greyhound Corp. v. Superior Court, supra, 56 Cal.2d at p. 383.) A reviewing court may not use the abuse of discretion standard to shield discovery orders that fall short: “Any record which indicates a failure to give adequate consideration to these concepts is subject to the attack of abuse of discretion, regardless of the fact that the order shows no such abuse on its face.” (Id. at p. 384; see Pacific Tel. & Tel. Co. v. Superior Court (1970) 61');">2 Cal.3d 161, 171.)

         II. The Movant's Burden When Seeking to Compel Responses to Interrogatories

         In the absence of contrary court order, a civil litigant's right to discovery is broad. “[A]ny party may obtain discovery regarding any matter, not privileged, that is relevant to the subject matter involved in the pending action... if the matter either is itself admissible in evidence or appears reasonably calculated to lead to the discovery of admissible evidence.” (Code Civ. Proc., § 2017.010; see Davies v. Superior Court (1984) 36 Cal.3d 291, 301 [“discovery is not limited to admissible evidence”].)[2] This right includes an entitlement to learn “the identity and location of persons having knowledge of any discoverable matter.” (§ 2017.010) Section 2017.010 and other statutes governing discovery “must be construed liberally in favor of disclosure unless the request is clearly improper by virtue of well-established causes for denial.” (Greyhound Corp. v. Superior Court, supra, 56 Cal.2d at p. 377.) This means that “disclosure is a matter of right unless statutory or public policy considerations clearly prohibit it.” (Id. at p. 378.)

         A party may use interrogatories to request the identity and location of those with knowledge of discoverable matters. (Code Civ. Proc., § 2030.010.) To show an interrogatory seeks relevant, discoverable information “is not the burden of [the party propounding interrogatories]. As a litigant, it is entitled to demand answers to its interrogatories, as a matter of right, and without a prior showing, unless the party on whom those interrogatories are served objects and shows cause why the questions are not within the purview of the code section.” (West Pico Furniture Co. v. Superior Court (1961) 56 Cal.2d 407, 422; see Greyhound Corp. v. Superior Court, supra, 56 Cal.2d at p. 388.) While the party propounding interrogatories may have the burden of filing a motion to compel if it finds the ...

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