United States District Court, N.D. California, San Jose Division
LILIANA CANELA, individually and on behalf of all others similarly situated, Plaintiff,
COSTCO WHOLESALE CORPORATION, and DOES 1 through 10, inclusive, Defendants.
DENYING DEFENDANT'S MOTION FOR PARTIAL SUMMARY
JUDGMENT [Re: ECF 44]
LABSON FREEMAN UNITED STATES DISTRICT JUDGE.
Liliana Canela brings this action against Defendant Costco
Wholesale Corporation (“Costco”) for allegedly
failing to provide suitable seats to employees in violation
of Labor Code § 1198 pursuant to California's
Private Attorneys General Act (“PAGA”). Compl.
¶¶ 9-10, ECF 1. Before the Court is Costco's
motion for partial summary judgment. Mot., ECF 44. Costco
essentially requests the Court to issue a ruling that Canela
“may proceed only on her own individual claim” as
opposed to a “representative action.”
Id. at 24-25. Having considered the briefing and
oral argument of the parties, as well as the governing law,
the Court DENIES Costco's motion for partial summary
Costco and Its Employees
is a membership-club retailer that sells merchandise and
services out of warehouses. Mot. 2. Costco's warehouses
have an entrance door and an exit door where one or more
employees are stationed. Id. Employees who are
classified as a “Member Service Assistant” work
at the entrance and exit doors. See Ex. 3 to Schroeder Decl.
(“Parks Dep.”) 9:5- 13, ECF 44-2. Member Service
Assistants provide service to Costco's members (i.e.,
customers), including directing members to product and
service locations, assisting loading and shipping, and
keeping the area clean. Mot. 4. Although Member Service
Assistants are the employees whose job description specifies
work at the entrance and exit doors, other employees have
performed the function of Member Service Assistants from time
to time. Ex. 8 to Schroeder Decl. (“Hernandez
Decl.”) ¶ 3, ECF 44-2; Ex. 4 to Schroeder Decl.
(“Alexander Decl.”) ¶ 2, ECF 44-2; Ex. 12 to
Schroeder Decl. (“Richards Decl.”) ¶ 3, ECF
44-2. Costco does not systematically record which employees
work at which door on any given day or at any given time. See
Parks Dep. 22:8-25; Ex. 5 to Schroeder Decl. (“Castro
Decl.”) ¶ 3, ECF 44-2; Richards Decl. ¶ 3;
Ex. 10 to Schroeder Decl. (“Marmon Decl.”) ¶
2, ECF 44-2.
worked at Costco's Santa Clara warehouse from 2002 to
2017 and then transferred to the Great Oaks
warehouse. Ex. 1 to Schroeder Decl. (“Canela
Dep.”) 14:1-15:3, ECF 44-2. During her employment,
Canela was classified as a Member Service Assistant for a
couple of months in 2013. Id. at 13:17-25, 56:3-8,
59:20-60:2, 60:18-21. She held that position as an
accommodation for an injury. Id. At that time,
Canela worked only at the entrance door. Id. at
59:20-60:2. After the two-month accommodation period in 2013,
Canela worked about three to four times a month at the
entrance or exit door to cover for other employees.
Id. at 60:22-62:10.
Costco maintains job descriptions which detail the duties
assigned to Member Service Assistants, it appears that there
is a variation in the manner in which the job is actually
performed. To demonstrate this variation, Costco submitted
several declarations. For example, Bill Walker worked as a
Member Service Assistant at the Oxnard warehouse for 28
years. Ex. 15 to Schroeder Decl. (“Walker Decl.”)
¶ 2, ECF 44-2. He has almost exclusively worked at the
entrance door. Id. ¶ 3. On the other hand, some
employees may choose to work only at the exit door.
See Hernandez Decl. ¶ 3. As another example,
Francisco Fruto, a Member Service Assistant at the Chino
Hills warehouse, performs floor walks for most of his time
instead of staying at the doors. See Ex. 6 to
Schroeder Decl. (“Fruto Decl.”) ¶¶ 2-7,
ECF 44-2. Another Member Service Assistant at the Chino Hills
warehouse, Gary Gomez, uses a wheelchair and performs jobs
including picking trash, pushing carts to members, and
rolling electric carts to plug them in. Ex. 7 to Schroeder
(“Gomez Decl.”) ¶¶ 2, 6-7, ECF 44-2.
Some employees who are not classified as a Member Service
Assistant have filled in at the doors. See Castro
Decl. ¶ 3; Marmon Decl. ¶ 2; Richards Decl. ¶
filed this action on July 1, 2013. Her complaint asserts only
one cause of action: violation of California Labor Code
§ 1198. Compl. ¶ 9. According to the
complaint, § 1198 does not permit an employer to employ
a worker “under conditions of labor that are prohibited
by [an] applicable wage order.” Id. The
applicable wage order at issue is Wage Order 7-2001
(“Seating Wage Order”). Section 14 of that order
(A) All working employees shall be provided with suitable
seats when the nature of the work reasonably permits the
use of seats.
(B) When employees are not engaged in the active duties of
their employment and the nature of the work requires
standing, an adequate number of suitable seats shall be
placed in reasonable proximity to the work area and
employees shall be permitted to use such seats when it does
not interfere with the performance of their duties.
Cal. Code Regs. tit. 8, § 11070; see Compl.
¶ 9. The complaint alleges the one cause of action as a
PAGA claim under a class action. Compl. ¶¶ 8-17.
Specifically, Canela initially sought to represent
“[a]ll employees of Costco who at any time, within the
applicable period of limitations, have been designated as [a]
member service [assistant] and have, within California, been
assigned to work either as a greeter or as an exit checker,
and were not provided with a seat.” Id. ¶
15. On August 2, 2013, Costco removed the action to this
District under the Class Action Fairness Act
(“CAFA”). Notice of Removal, ECF 1. Thereafter,
the action was stayed for over two years pending the
California Supreme Court's issuance of an order answering
suitable seating questions certified by the Ninth Circuit in
Kilby v. CVS Pharmacy (12-56130) and Henderson
v. JPMorgan Chase (13-56095). See ECF 26. The
stay was lifted on May 5, 2016. Id.
September 20, 2017, the parties filed a joint status report.
ECF 34. Canela reported that she would not seek class
certification and suggested that this Court lacks subject
matter jurisdiction for that reason. Id. The Court
ordered the parties to brief whether this Court retained
jurisdiction. ECF 35. After reviewing the parties'
briefs, the Court concluded that subject matter jurisdiction
exists because Canela's representation that she would not
seek class certification does not divest this Court's
jurisdiction over this action that was properly removed under
CAFA. ECF 41. Based on Canela's failure to seek class
certification, Costco filed its motion for partial summary
2003, California enacted PAGA to permit “aggrieved
employees, acting as private attorneys general, ” to
bring lawsuits against employers for Labor Code violations.
Arias v. Superior Court, 46 Cal.4th 969, 980 (2009).
The goal was to foster compliance with state labor laws.
Id. Thus, PAGA provides that an “aggrieved
employee” may bring an action “on behalf of
himself or herself and other current or former
employees” to recover civil penalties for violations of
the Labor Code. Cal. Lab. Code § 2699. Where the Labor
Code does not set forth its own penalty, PAGA sets forth a
civil penalty of 100 dollars for each aggrieved employee per
pay period for the initial violation and 200 dollars for each
aggrieved employee per pay period for each subsequent
violation. Id. § 2699(f)(2). “Of the
civil penalties recovered, 75 percent goes to the Labor and
Workforce Development Agency [(“LWDA”)], leaving
the remaining 25 percent for the ‘aggrieved
employees.'” Arias, 46 Cal.4th at 980-81.
An employee suing under PAGA “does so as [a] proxy or
agent of the state's labor law enforcement
agencies.” Id. at 986.
Rule of Civil Procedure 56 governs motions for summary
judgment. Summary judgment is appropriate “if the
pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any,
show that there is no genuine issue as to any material fact
and that the moving party is entitled to a judgment as a
matter of law.” Celotex Corp. v. Catrett, 477
U.S. 317, 322 (1986). “Partial summary judgment that
falls short of a final determination, even of a single claim,
is authorized by Rule 56 in order to limit the issues to be
tried.” State Farm Fire & Cas. Co. v.
Geary, 699 F.Supp. 756, 759 (N.D. Cal. 1987).
moving party “bears the burden of showing there is no
material factual dispute, ” Hill v. R Carriers,
Inc., 690 F.Supp.2d 1001, 1004 (N.D. Cal. 2010), by
“identifying for the court the portions of the
materials on file that it believes demonstrate the absence of
any genuine issue of material fact.” T.W. Elec.
Serv. Inc. v. Pac. Elec. Contractors Ass'n, 809 F.2d
626, 630 (9th Cir. 1987). In judging evidence at the summary
judgment stage, the Court “does not assess credibility
or weigh the evidence, but simply determines whether there is
a genuine factual issue for trial.” House v.
Bell, 547 U.S. 518, 559-60 (2006). A fact is
“material” if it “might affect the outcome
of the suit under the governing law, ” and a dispute as
to a material fact is “genuine” if there is
sufficient evidence for a reasonable trier of fact to decide
in favor of the nonmoving party. Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 248 (1986).
the moving party will have the burden of proof on an issue at
trial, it must affirmatively demonstrate that no reasonable
trier of fact could find other than for the moving party.
Celotex, 477 U.S. at 325; Soremekun v. Thrifty
Payless, Inc., 509 F.3d 978, 984 (9th Cir. 2007). Once
the moving party meets its initial burden, the nonmoving
party must set forth, by affidavit or as otherwise provided
in Rule 56, “specific facts showing that there is a
genuine issue for trial.” Liberty Lobby, 477
U.S. at 250 (internal quotation marks omitted). If the
nonmoving party's “evidence is merely colorable, or
is not significantly probative, summary judgment may be
granted.” Id. at 249-50 (internal citations
omitted). Mere conclusory, speculative testimony in
affidavits and moving papers is also insufficient to raise
genuine issues of fact and defeat summary judgment. See
Thornhill Publ'g Co. v. GTE Corp., 594 F.2d 730, 738
(9th Cir.1979). For a court to find that a genuine dispute of
material fact exists, “there must be enough doubt for a
reasonable trier of fact to find for the [non-moving
party].” Corales v. Bennett, 567 F.3d 554, 562
(9th Cir. 2009).
Court may generally consider matters properly subject to
judicial notice. See Tellabs, Inc. v. Makor Issues &
Rights, Ltd., 551 U.S. 308, 322 (2007). In her
opposition, Canela requests that the Court take judicial
notice of the tentative order dated February 1, 2018 in
Hall v Rite Aid Corporation, San Diego
Superior Court No. 37-2009-00087938-CU-OE-CTL, which became
the final order (Ex. 7 to Decl. of McInerney, ECF 45-2).
Opp'n 17, ECF 45. Canela's request to take judicial
notice is GRANTED, as the document is a matter of public
record and Costco does not dispute its authenticity.
Fed.R.Evid. 201; Reyn's Pasta Bella, LLC v. Visa USA,
Inc., 442 F.3d 741, 746 n.6 (9th Cir. 2006). While the
document is accepted as what it represents, any specific fact
findings and legal conclusions set forth in that document may
not bind this Court.
moves for partial summary judgment that: (1) Canela lacks
standing in federal court under Article III of the U.S.
Constitution to represent unnamed third parties; (2) Canela
cannot represent unnamed third parties in federal court
without Rule 23 certification; and (3) Canela cannot
represent unnamed third parties at trial because her
representative claims in this action are unmanageable. Mot.
2-3; Proposed Order, ECF 44-3. The first two issues are legal
issues and do not depend on a material dispute of fact.
Partial summary adjudication may be granted on a purely legal
issue. Fed.R.Civ.P. 56 (“The court shall grant summary
judgment if the movant shows that there is no genuine dispute
as to any material fact and the movant is entitled to
judgment as a matter of law.”). For the reasons stated
below, the Court DENIES Costco's motion.
Article III Standing
argues that Canela lacks Article III standing to represent
unnamed third parties in this action. Mot. 10. As mentioned,
Canela asserts a representative PAGA claim and seeks to
represent “[a]ll employees of Costco who at any time,
within the applicable period of limitations, have been
designated as [a] member service [assistant] and have, within
California, been assigned to work either as a greeter or as
an exit checker, and were not provided with a seat.”
Compl. ¶ 15. Costco contends that Canela cannot do so
because she failed to obtain Rule 23 class certification.
Mot. 11-13. According to Costco, allowing Canela to assert a
representative PAGA claim (as opposed to advancing only her
individual PAGA claim) would violate Article III standing
requirements-unless she had relied on the class action
exception-because she was not injured by Costco's ...