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Perez v. DNC Parks & Resorts At Asilomar, Inc.

United States District Court, E.D. California

October 30, 2019

DAVID PEREZ, individually, and on behalf of others similarly situated, Plaintiff,
v.
DNC PARKS & RESORTS AT ASILOMAR, INC., a California Corporation, et al., Defendants.

          ORDER GRANTING DEFENDANTS' MOTION FOR JUDGMENT ON THE PLEADINGS, DENYING PLAINTIFF'S MOTION FOR LEAVE TO FILE THE PROPOSED FIRST AMENDED COMPLAINT, AND GRANTING PLAINTIFF LEAVE TO AMEND (DOCS. NO. 17, 27)

         This matter is before the court on a motion for judgment on the pleadings filed on behalf of defendants DNC Parks & Resorts at Asilomar, Inc. (“Asilomar”), DNC Parks & Resorts at Sequoia, Inc. (“Sequoia”), DNC Parks & Resorts at Yosemite, Inc. (“Yosemite”), Delaware North Companies, Inc. (“DNCI”), DNC Parks & Resorts at Kings Canyon, Inc. (“Kings Canyon”), DNC Parks & Resorts at Tenaya Inc. (“Tenaya”), and Delaware North Companies Parks & Resorts, Inc. (“DNCPRI”) (collectively, “defendants”) and plaintiff David Perez's motion for leave to file a first amended complaint. (Doc. Nos. 17, 27.) On September 17, 2019, those motions came before the court for hearing. Attorneys Irina Kirnosova and Mikael Stahle appeared telephonically on behalf of plaintiff. Attorneys Jonathan L. Brophy and Lauren R. Leibovitch appeared telephonically on behalf of defendants. Having considered the parties' briefing and arguments, defendants' motion for judgment on the pleadings is granted and plaintiff's motion for leave to file the proposed first amended complaint is denied. Plaintiff, however, will be granted leave to amend.

         BACKGROUND

         Plaintiff's action was originally filed on February 28, 2019, in Tulare County Superior Court as a class action, alleging violations of California's Labor Code and Unfair Competition Law (“UCL”) and a Private Attorneys General Act (“PAGA”) claim. (Doc. No. 1, Ex. A (“Compl.”) at ¶¶ 18-65.) As alleged in the complaint, plaintiff was a former employee of defendants. (Compl. at ¶ 3.) According to plaintiff:

DEFENDANTS . . . acted pursuant to, and in furtherance of, their policies and practices of not paying PLAINTIFF and CLASS MEMBERS all wages earned and due, through methods and schemes which include, but are not limited to, failing to pay overtime premiums; failing to provide rest and meal periods; failing to properly maintain records; failing to provide accurate itemized statements for each pay period; failing to properly compensate PLAINTIFF and CLASS MEMBERS for necessary expenditures; and requiring, permitting, or suffering the employees to work off the clock . . ..

(Id. at ¶ 3, 15.) The relevant time period alleged by plaintiff is the four years prior to the filing of this action, to continue while this action is pending. (Id. at ¶ 4.)

         Defendants answered plaintiff's complaint on April 10, 2019 (Doc. No. 1-2) and removed the action to this federal court on April 12, 2019 on the basis of federal question jurisdiction and the Class Action Fairness Act (“CAFA”). (Doc. No. 1.) On July 9, 2019, defendants filed the pending motion for judgment on the pleadings and plaintiff subsequently moved for leave to file a first amended complaint on August 19, 2019. (Docs. No. 17, 27.)

         LEGAL STANDARDS

         A. Motion for Judgment on the Pleadings Rule 12(c) of the Federal Rules of Civil Procedure provides that “[a]fter the pleadings are closed-but early enough not to delay trial-a party may move for judgment on the pleadings.” In reviewing a motion brought under Rule 12(c), the court “must accept all factual allegations in the complaint as true and construe them in the light most favorable to the nonmoving party.” Fleming v. Pickard, 581 F.3d 922, 925 (9th Cir. 2009).

         The same legal standard applicable to a Rule 12(b)(6) motion applies to a motion brought pursuant to Rule 12(c). Dworkin v. Hustler Magazine, Inc., 867 F.2d 1188, 1192 (9th Cir. 1989). Accordingly, “judgment on the pleadings is properly granted when, taking all the allegations in the non-moving party's pleadings as true, the moving party is entitled to judgment as a matter of law.” Marshall Naify Revocable Tr. v. United States, 672 F.3d 620, 623 (9th Cir. 2012) (quoting Fajardo v. Cty. of Los Angeles, 179 F.3d 698, 699 (9th Cir. 1999)); see also Fleming, 581 F.3d at 925 (noting that “judgment on the pleadings is properly granted when there is no issue of material fact in dispute, and the moving party is entitled to judgment as a matter of law”). The allegations of the nonmoving party must be accepted as true, while any allegations made by the moving party that have been denied or contradicted are assumed to be false. MacDonald v. Grace Church Seattle, 457 F.3d 1079, 1081 (9th Cir. 2006). The facts are viewed in the light most favorable to the non-moving party and all reasonable inferences are drawn in favor of that party. Living Designs, Inc. v. E.I. DuPont de Nemours & Co., 431 F.3d 353, 360 (9th Cir. 2005).

         Courts have discretion both to grant a motion for judgment on the pleadings with leave to amend or to simply grant dismissal of causes of action rather than grant judgment as to them. Lonberg v. City of Riverside, 300 F.Supp.2d 942, 945 (C.D. Cal. 2004) (citations omitted); see also Pac. W. Grp. v. Real Time Sols., Inc., 321 Fed. App'x 566, 569 (9th Cir. 2008);[1] Woodson v. State of California, No. 2:15-cv-01206-MCE-CKD, 2016 WL 524870, at *2 (E.D. Cal. Feb. 10, 2016). Generally, dismissal without leave to amend is proper only if it is clear that “the complaint could not be saved by any amendment.” Intri-Plex Techs. v. Crest Grp., 499 F.3d 1048, 1056 (9th Cir. 2007) (citing In re Daou Sys., Inc., 411 F.3d 1006, 1013 (9th Cir. 2005)); see also Ascon Props., Inc. v. Mobil Oil Co., 866 F.2d 1149, 1160 (9th Cir. 1989) (noting that “[l]eave need not be granted where the amendment of the complaint . . . constitutes an exercise in futility”).

         B. Motion for Leave to Amend

         Under Rule 15 of the Federal Rules of Civil Procedure, once an answer has been filed, a party may amend a pleading only with leave of court or after obtaining the written consent of the adverse party. See Fed. R. Civ. P. 15(a). A court should grant leave to amend freely when justice so requires. Id. The Supreme Court has instructed lower courts to heed carefully the command of Rule 15. See Foman v. Davis, 371 U.S. 178, 182 (1962). “[R]ule 15's policy of favoring amendments to pleadings should be applied with extreme liberality.” DCD Programs Ltd. v. Leighton, 833 F.2d 183, 186 (9th Cir. 1987) (citations and internal quotations omitted); see also Price v. Kramer, 200 F.3d 1237, 1250 (9th Cir. 2000). As the Supreme Court has articulated:

In the absence of any apparent or declared reason-such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowing the amendment, futility of the amendment, etc.-the leave sought should, as the rules require, be “freely given.”

Foman, 371 U.S. at 182; see also Bowles v. Reade, 198 F.3d 752, 757-58 (9th Cir. 1999). “Not all of the factors merit equal weight. As this circuit and others have held, it is the consideration of prejudice to the opposing party that carries the greatest weight.” Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003); see also Sonoma Cty. Ass'n of Retired Emps. v. Sonoma Cty., 708 F.3d 1109, 1117 (9th Cir. 2013). “Absent prejudice, or a strong showing of any of the remaining Foman factors, there exists a presumption under Rule 15(a) in favor of granting leave to amend.” Eminence Capital, LLC, 316 F.3d at 1052; see also Sonoma Cty. Ass'n of Retired Emps., 708 F.3d at 1117.

         DISCUSSION

         A. Motion for Judgment on the Pleadings

         Defendants move for judgment on the pleadings based primarily on the federal enclave doctrine and for failure to state a claim. The court will address each of defendants' arguments, and plaintiff's responses, if any, below.

         1. The Federal Enclave Doctrine

         Defendants Yosemite, Sequoia, and Kings Canyon argue that the federal enclave doctrine bars plaintiff from asserting against them any causes of action based on state laws that came into force after Yosemite, Sequoia, and Kings Canyon National Parks became federal enclaves. (Doc. No. 17-1 at 13.)

         The federal enclave doctrine applies:

[W]hen the United States acquires with the “consent” of the state legislature land within the borders of that State. . . . [In such cases, ] the jurisdiction of the Federal Government becomes “exclusive.” The power of Congress over federal enclaves that come within the scope of Art. I, § 8, cl. 17 . . . bars state regulation without specific congressional action. This exclusive jurisdiction is “legislative, ” meaning the laws and statutes applied to these locations must be supplied by the federal government, not the states. When Congress legislates with respect to . . . federal enclaves it acts as a state government with all the powers of a state government, and thus Congress acts as a state government with total legislative, executive and judicial power.

Allison v. Boeing Laser Tech. Servs., 689 F.3d 1234, 1236-37 (10th Cir. 2012) (citations and internal quotations omitted).

         However, “when an area in a State becomes a federal enclave . . . the [state] law in effect at the time of the transfer of jurisdiction continues in force. . . . Existing state law typically does not continue in force, however, to the extent it conflicts with ‘federal policy.' And going forward, state law presumptively does not apply to the enclave.” Parker Drilling Mgmt. Servs., Ltd. v. Newton, __U.S.__, 139 S.Ct. 1881, 1890 (2019) (citations and internal quotations omitted); see also Cooper v. S. Cal. Edison Co., 170 Fed.Appx. 496, 497 (9th Cir. 2006), as amended on denial of reh'g and reh'g en banc (May 10, 2006) (“Only federal law applies on a federal enclave, but preexisting state law not inconsistent with federal policy becomes federal law and is applicable as well.”) (citing Paul v. United States, 371 U.S. 245, 263-64 (1963)).[2]

         The following statutes and orders form the basis of plaintiff's complaint in this case: (1) California Labor Code §§ 201-203, 510, 1174, 1194, 1197, 1198, and 2802, enacted in 1937, for the First, Third, Fourth, Fifth, Seventh, and Eighth Causes of Actions; (2) California Labor Code § 226, enacted in 1943, for the Sixth and Seventh Causes of Actions; (3) California Labor Code § 512, enacted in 1999, for the First and Second Causes of Actions; (4) California Labor Code § 226.7, enacted in 2000, for the First and Second Causes of Actions; (5) California Labor Code §§ 2698-2699.5, enacted in 2003 and 2004, for the Tenth Cause of Action; (6) California Business & Professions Code § 17200 et seq., enacted in 1997, for the Ninth Cause of Action; and (7) IWC Wage Order No. 5-2001, issued in 1986, for the First, Second, Third, Fourth, Sixth, and Seventh Causes of Action. (Compl. at ¶¶ 19-65.)

         a. Plaintiff's Claims Against Defendants Yosemite and Sequoia Are Barred by the Federal Enclave Doctrine

         Defendants Yosemite and Sequoia operate in the Yosemite and Sequoia National Parks, which have been federal enclaves since June 2, 1920. 16 U.S.C. § 57 (“Sole and exclusive jurisdiction is assumed by the United States over the territory embraced and included within the Yosemite National Park [and] Sequoia National Park”). As indicated above, all of plaintiff's claims against defendants Yosemite and Sequoia rely solely on state law passed after the Yosemite and Sequoia National Parks became federal enclaves. Thus, plaintiff's claims against defendants Yosemite and Sequoia are presumptively barred. See Parker Drilling Mgmt. Servs., 139 S.Ct. at 1890 (holding that state laws passed after an area becomes a federal enclave “presumptively [do] not apply”).

         In addition, plaintiff fails to respond in his opposition to defendants' argument in this regard, effectively conceding his claims against defendants Yosemite and Sequoia.[3] See Contreras v. Esper, No. 2:14-cv-01282-KJM-KJN, 2018 WL 1503678, at *3 (E.D. Cal. Mar. 27, 2018) (citing Carvalho v. Equifax Info. Servs., LLC, 629 F.3d 876, 888 (9th Cir. 2010) (“A plaintiff who makes a claim . . . in his complaint, but fails to raise the issue in response to a defendant's motion to dismiss . . . has effectively abandoned his claim . . . .”) and Moore v. Apple, Inc., 73 F.Supp.3d 1191, 1205 (N.D. Cal. 2014) (collecting cases and finding that abandonment of a claim warrants dismissal without leave to amend or with prejudice)).

         Accordingly, plaintiff's claims against defendants Yosemite and Sequoia will be dismissed with prejudice.

         b. Plaintiff's Claims Against Defendant Kings Canyon Are Barred in Part by the Federal Enclave Doctrine

         Defendant Kings Canyon operates in Kings Canyon National Park (“KCNP”), which both parties contend became a federal enclave on August 4, 1943.

         Defendants argue that plaintiff's First, Second, Third, Fourth, Sixth, Seventh, Ninth, and Tenth Causes of Action are barred by the federal enclave doctrine as to defendant Kings Canyon because they are based on state laws that came into effect after KCNP became a federal enclave. (Doc. No. 17-1 at 15.) Plaintiff responds that California Labor Code §§ 510, 1174, 1194, 1197, and 1198, the bases for his First, Third, and Fourth Causes of Action, were enacted in 1937, before KCNP was created. (Doc. No. 20 at 20.) However, plaintiff fails to respond to defendants' arguments regarding the IWC Wage Order and the Second, Ninth, and Tenth Causes of Actions, effectively conceding the merit of defendants' motion as to those causes of action. Accordingly, plaintiff's Second, Ninth, and Tenth Causes of Action are dismissed with prejudice as to defendant Kings Canyon. To the extent claims against defendant Kings Canyon are predicated on IWC Wage Order No. 5-2001, they are also dismissed with prejudice.

         Plaintiff also argues that California Labor Code § 226, partly serving as the basis for his Sixth and Seventh Causes of Action, remains in force at KCNP because it went into effect on August 4, 1943, the same day the State of California purportedly ceded jurisdiction over KCNP to the federal government. (Doc. No. 20 at 19-20.) Defendants counter this argument on the grounds that, “[a]lthough Section 226 was enacted on the same day that the federal enclave at Kings Canyon was created, it was not already ‘in existence' at the time the enclave was created” and thus does not apply in KCNP. (Doc. No. 25 at 10.)

         The court concludes that both parties have missed the mark in this regard. What both parties fail to recognize is that KCNP did not became a federal enclave until June 1, 1945. KCNP was proclaimed on March 4, 1940. See 16 U.S.C. § 80 (reserving and withdrawing an area of California land “from settlement, occupancy, or disposal under the laws of the United States [to] dedicate[] and set apart as a public park, to be known as the Kings Canyon National Park”). On August 4, 1943, California passed 1943 Cal. Stat. 801, which provides that “[e]xclusive jurisdiction shall be and the same is hereby ceded to the United States over and within all of the territory . . . set aside and dedicated for park purposes by the United States as ‘Kings Canyon National Park.'” However, that statute specified that “[t]he jurisdiction granted by this section shall not vest until the United States though the proper office notifies the State of California that it assumes police jurisdiction over said park.” Id. That happened when the U.S. Secretary of Interior, in a letter to the Governor of California, accepted on behalf of the United States “exclusive jurisdiction over all lands now included in Kings Canyon National Park” and gave notice that the United States had assumed “police jurisdiction over the said park, ” effective June 1, 1945. Police Jurisdiction Assumed by U.S., 10 Fed. Reg. 6, 041 (Apr. 21, 1945). Thus, federal administration of the park was concurrent with state jurisdiction from March 4, 1940 until the United States accepted exclusive jurisdiction on June 1, 1945.

         Moreover, federal law is clear that a federal enclave is created when the United States assumes exclusive jurisdiction over land within a State. See Allison, 689 F.3d at 1236-37. “[S]tate law existing at the time of the acquisition remains enforceable, not subsequent laws.” Paul, 371 U.S. at 268 (emphasis added); see also Carvajal v. Pride Indus., Inc., No. 10 CV 2319-GPC(MDD), 2013 WL 1728273, at *5 (S.D. Cal. Apr. 22, 2013) (“Under the federal enclave doctrine, state laws have no effect on federal enclaves unless they preexisted the surrender of sovereignty and are not inconsistent with the laws of the United States or with the government use for which the property was acquired.”) (emphasis added); Mersnick v. USProtect Corp., No. C-06-03993 RMW, 2006 WL 3734396, at *6 (N.D. Cal. Dec. 18, 2006) (“[S]tate laws existing at the time the United States accepts jurisdiction remain enforceable unless ...


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