Cortez v. Doty Bros. Equip. Co., No. B275255 (D2d7 Sept. 1, 2017)
This case presents but doesn’t resolve some pretty complicated questions about appealability and the death knell doctrine.
Showing posts with label death knell. Show all posts
Showing posts with label death knell. Show all posts
Thursday, September 28, 2017
Wednesday, June 21, 2017
Stretching to Compel Third Party Arb
Garcia v. Pexco, LLC, No. G052872 (D4d3 May 16, 2017)
Temp works for Temp Service. He brings a wage-and-hour class action against Temp Service and a Company where he was assigned to work. The employment contract between Temp and Temp Service has an arbitration clause with a class action waiver. Company isn’t a party, but joins Temp Service’s motion to compel, which the trial court grants.
Temp works for Temp Service. He brings a wage-and-hour class action against Temp Service and a Company where he was assigned to work. The employment contract between Temp and Temp Service has an arbitration clause with a class action waiver. Company isn’t a party, but joins Temp Service’s motion to compel, which the trial court grants.
Friday, November 11, 2016
The Death Knell Still Rings Naught!
Nguyen v. Applied Med. Res. Corp., No. G052207 (D4d3 Oct. 14, 2016)
Denials of class cert motions and grants of motions to compel arbitration of claims subject to class action waivers are usually appealable under the “death knell” doctrine. The gist is that what’s left of the case is usually not economically viable to try or arbitrate, so refusing the permit the plaintiff on proceed on a class basis is the “death knell” for the litigation more generally, and thus provides a justification for an interlocutory appeal.
Denials of class cert motions and grants of motions to compel arbitration of claims subject to class action waivers are usually appealable under the “death knell” doctrine. The gist is that what’s left of the case is usually not economically viable to try or arbitrate, so refusing the permit the plaintiff on proceed on a class basis is the “death knell” for the litigation more generally, and thus provides a justification for an interlocutory appeal.
Wednesday, October 28, 2015
Death Knell Permits Appeal of Denial of PAGA Representaive Status
Miranda v. Anderson Enters., No. A140328 (D1d5 Oct. 15, 2015)
Since the Supreme Court’s Iskanian decision permitted claims under the Labor Code Private Attorney General Act to skirt the class action waiver arbitration clauses that are otherwise decimating employment class action practice, PAGA has been at the forefront of employment litigation in California. In this case, the trial court, in a pre-Iskanian order, held that Plaintiff’s representative PAGA claims were subject to a class action waiver in her employment contract. There’s little question that the order won’t hold up under Iskanian. But can it be raised in an immediate interlocutory appeal?
Under the “death knell” doctrine, some orders denying class treatment of claims are immediately appealable, notwithstanding the fact that plaintiff could still pursue her own claims on an individual basis. In many cases, denying class treatment transforms the incentive structure for a case in ways that make it highly unlikely if not impossible to pursue individual claims to judgment. If that happens, a denial of class cert would effectively be shielded from review. Thus, since denying cert will practically terminate the whole case, courts often permit a direct appeal of that decision, notwithstanding the absence of a final judgment.
It’s an open question as to whether the death knell doctrine applies denial of representative treatment for PAGA claims. But the court here holds it does. There are various procedural differences between PAGA representative actions and class actions. Indeed, some of those distinctions—in particular, that the plaintiff is acting in a quasi qui tam capacity on the State’s behalf—are the basis of Iskanian. But there are also similarities. And when it comes to the death knell doctrine, the similarities matter more than the differences. In particular, the denial of representative status for PAGA claims alters the incentives to pursue small cases in more or less same way as denial of class cert does. So just like a decision denying cert or sending a case to non-class arbitration, a denial of the right to proceed with PAGA claims on a representative basis effectively rings the death knell on those claims too.
Reversed.
Since the Supreme Court’s Iskanian decision permitted claims under the Labor Code Private Attorney General Act to skirt the class action waiver arbitration clauses that are otherwise decimating employment class action practice, PAGA has been at the forefront of employment litigation in California. In this case, the trial court, in a pre-Iskanian order, held that Plaintiff’s representative PAGA claims were subject to a class action waiver in her employment contract. There’s little question that the order won’t hold up under Iskanian. But can it be raised in an immediate interlocutory appeal?
Under the “death knell” doctrine, some orders denying class treatment of claims are immediately appealable, notwithstanding the fact that plaintiff could still pursue her own claims on an individual basis. In many cases, denying class treatment transforms the incentive structure for a case in ways that make it highly unlikely if not impossible to pursue individual claims to judgment. If that happens, a denial of class cert would effectively be shielded from review. Thus, since denying cert will practically terminate the whole case, courts often permit a direct appeal of that decision, notwithstanding the absence of a final judgment.
It’s an open question as to whether the death knell doctrine applies denial of representative treatment for PAGA claims. But the court here holds it does. There are various procedural differences between PAGA representative actions and class actions. Indeed, some of those distinctions—in particular, that the plaintiff is acting in a quasi qui tam capacity on the State’s behalf—are the basis of Iskanian. But there are also similarities. And when it comes to the death knell doctrine, the similarities matter more than the differences. In particular, the denial of representative status for PAGA claims alters the incentives to pursue small cases in more or less same way as denial of class cert does. So just like a decision denying cert or sending a case to non-class arbitration, a denial of the right to proceed with PAGA claims on a representative basis effectively rings the death knell on those claims too.
Reversed.
Tuesday, July 28, 2015
For Whom the Death Knell Tolls Not
Munoz v. Chipotle Mexican Grill, No. 249505 (D2d1 Jun. 30, 2015).
Second Munoz case decided on the same day, but different Munozes.
This Munoz filed a class action alleging a slew of wage and hour claims, claims that expenses for work clothing were improperly deducted from pay, and claims under the Labor Code Private Attorney General Act. The court largely denied class cert because individual issues predominated. But the PAGA claims—which don’t require cert because they are brought, effectively, on behalf of the state in an enforcement capacity—were unaffected. Munoz appealed.
Generally, a plaintiff can appeal an outright denial of class cert under the “death knell” doctrine. The rationale is that, with class treatment off the table, it often becomes economically unviable for an individual plaintiff to pay his attorney to continue to pursue the case to judgment. So, as a matter of policy, an interlocutory appeal is permitted. But the doctrine doesn’t permit an appeal when class cert is partially denied. So long as there’s enough of a claim to profitably prosecute, the plaintiff maintains an incentive to continue. The policy against piecemeal appeals trumps the policy supporting immediate review.
Here, class cert was denied in full. But Munoz still has his PAGA claims. He asserts them on behalf of 26,000 employees. And the PAGA penalties are $100 per employee, per pay period in which a violation continues, 25 percent of which go to the plaintiff. So there’s still plenty of economic incentive for him to forge on, even without the class. The death knell hath not tolled!
Appeal dismissed.
Second Munoz case decided on the same day, but different Munozes.
This Munoz filed a class action alleging a slew of wage and hour claims, claims that expenses for work clothing were improperly deducted from pay, and claims under the Labor Code Private Attorney General Act. The court largely denied class cert because individual issues predominated. But the PAGA claims—which don’t require cert because they are brought, effectively, on behalf of the state in an enforcement capacity—were unaffected. Munoz appealed.
Generally, a plaintiff can appeal an outright denial of class cert under the “death knell” doctrine. The rationale is that, with class treatment off the table, it often becomes economically unviable for an individual plaintiff to pay his attorney to continue to pursue the case to judgment. So, as a matter of policy, an interlocutory appeal is permitted. But the doctrine doesn’t permit an appeal when class cert is partially denied. So long as there’s enough of a claim to profitably prosecute, the plaintiff maintains an incentive to continue. The policy against piecemeal appeals trumps the policy supporting immediate review.
Here, class cert was denied in full. But Munoz still has his PAGA claims. He asserts them on behalf of 26,000 employees. And the PAGA penalties are $100 per employee, per pay period in which a violation continues, 25 percent of which go to the plaintiff. So there’s still plenty of economic incentive for him to forge on, even without the class. The death knell hath not tolled!
Appeal dismissed.
Wednesday, August 6, 2014
Death Knell on Class Claims
Sandquist v. Lebo Automotive, No. B244412 (D2d7 July 22, 2014)
In this putative employment class action, the trial court in this case granted defendant’s motion to compel arbitration. In the process of doing so, it also struck plaintiff’s class allegations without prejudice because a class action waiver provision in the employment agreement ostensibly precluded litigation on a classwide basis. In a later order, the court dismissed the class claims with prejudice.
The court first holds that, although an order compelling arbitration is generally not appealable, the second order here is. Under the “death knell doctrine,” an order that is tantamount to a dismissal of the claims of the absent class members can be appealed. The trial court’s order striking plaintiffs’ class allegations did not meet that test—claims dismissed without prejudice are not effectively terminated. But the later order did. And even though plaintiff’s notice of appeal cited only the first order, the court construes the notice liberally to find that plaintiff was effectively appealing both orders.
As to the merits, the trial court should not have struck the class allegations. That issue, which required the court to interpret the agreement, should have been reserved for the arbitrator to decide. Although the precedent is split on the issue, the majority rule is that whether class-wide arbitration is barred is a procedural issue that falls within the arbitrator’s purview, as opposed to a more fundamental question of whether the parties actually agreed to arbitrate, which is reserved for the court to decide. The court here follows that rule.
reversed.
**Note: The Supreme Court granted review on November 12, 2014. Given the similar grant in Network Capital Funding, it would seem that the court will resolve the split referenced above.
In this putative employment class action, the trial court in this case granted defendant’s motion to compel arbitration. In the process of doing so, it also struck plaintiff’s class allegations without prejudice because a class action waiver provision in the employment agreement ostensibly precluded litigation on a classwide basis. In a later order, the court dismissed the class claims with prejudice.
The court first holds that, although an order compelling arbitration is generally not appealable, the second order here is. Under the “death knell doctrine,” an order that is tantamount to a dismissal of the claims of the absent class members can be appealed. The trial court’s order striking plaintiffs’ class allegations did not meet that test—claims dismissed without prejudice are not effectively terminated. But the later order did. And even though plaintiff’s notice of appeal cited only the first order, the court construes the notice liberally to find that plaintiff was effectively appealing both orders.
As to the merits, the trial court should not have struck the class allegations. That issue, which required the court to interpret the agreement, should have been reserved for the arbitrator to decide. Although the precedent is split on the issue, the majority rule is that whether class-wide arbitration is barred is a procedural issue that falls within the arbitrator’s purview, as opposed to a more fundamental question of whether the parties actually agreed to arbitrate, which is reserved for the court to decide. The court here follows that rule.
reversed.
**Note: The Supreme Court granted review on November 12, 2014. Given the similar grant in Network Capital Funding, it would seem that the court will resolve the split referenced above.
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