Derek Penn v. Team Industrial Services, Inc.

CASE NO: 25STCV26875 [TENTATIVE] ORDER RE: DEFENDANT TEAM INDUSTRIAL SERVICES, INC.'S MOTION TO STAY PROCEEDINGS Dept. 731 September 3, 2026 8:30 a.m. Matter No. 18 | Moving Party: Defendant, Team Industrial Services, Inc. Opposing Party: Plaintiff, Derek Penn Notice: OK

Background Facts Pleadings Plaintiff Derek Penn brings a Private Attorneys General Act ("PAGA") enforcement action against Team Industrial Services, Inc. and related Doe defendants, alleging numerous violations of the California Labor Code on behalf of himself and other aggrieved hourly, non - exempt employees.

Plaintiff asserts that Defendants failed to pay minimum, straight - time, and overtime wages; failed to provide compliant meal and rest periods; failed to pay all wages during employment and upon separation; failed to issue accurate itemized wage statements; failed to maintain proper payroll records; and failed to reimburse necessary business expenses. Plaintiff seeks civil penalties, injunctive relief, and attorneys' fees under PAGA for these alleged statutory violations.

Removal and Remand On December 17, 2025, Defendant filed a notice of removal of proceedings to federal court. On March 18, 2026, Plaintiff filed notice of a federal court order remanding proceedings to the state court based on Defendant's inability to show an amount in controversy meeting the minimum required for federal diversity jurisdiction. On March 23, 2026, the Clerk of the Central District of California served notice of the remand order to the Superior Court. On May 27, 2026, at a hearing attended by the parties regarding removal, counsel for Defendant advised the Court of Defendant's intent to file a motion to stay this action.

Motion Before the Court That same day, Defendant filed a motion to stay proceedings based on the pendency of a class action lawsuit, premised on the same wage-and-hour actionable conduct, as between the same Plaintiff and Defendant here, which Plaintiff filed in this Superior Court in July 2025 as LASC No. 25STCV20312--notably, before this PAGA action was filed on September 12, 2025--with Defendant removing the class action lawsuit to federal court in August 2025, where the case remains pending. Defendant's motion is opposed by Plaintiff, who filed an opposition on August 21, 2026. Defendant filed a reply on August 27, 2026. Defendant's motion is now before the Court.

Motion for Stay of Proceedings a. Request for Judicial Notice The Court takes judicial notice of the Complaint for the federal class action lawsuit referenced above, entitled Derek Penn, individually, and on behalf of other similarly situated employees v. TEAM Industrial Services, Inc., et al., filed by Plaintiff Derek Penn on July 8, 2025, in this Superior Court, LASC No. 25STCV20312, and removed to the United States District Court for the Central District of California on August 15, 2025, there assigned Case No. 2:25-cv-07652-SPG-RAO. (Motion, RJN, p. 1, Ex. A.)

However, the Court declines to consider extraneous rulings made by judicial officers other than the present officer, in different legal actions, neither involving the same plaintiff nor the same defendant here. (Motion, RJN, pp. 1-2, Exs. B-G.) "There is [...] a precondition to the taking of judicial notice in either its mandatory or permissive form--any matter to be judicially noticed must be relevant to a material issue." (People ex rel. Lockyer v. Shamrock Foods Co. (2000) 24 Cal.4th 415, 422 fn. 2.) Such relevance does not exist in the extraneous orders advanced for notice by Defendant.

b.

Legal Standard

When the two actions are pending in California--one in state court and the other in federal court--both courts "have acquired jurisdiction but neither acquires exclusive authority and each may proceed at its own pace until one or the other reaches final judgment and becomes res judicata on the issue." (Fowler v. Ross (1983) 142 Cal.App.3d 472, 477.) Absent extraordinary circumstances, state and federal courts do not interfere with or restrain each other's proceedings. (Id. at p. 476.) Extraordinary circumstances exist, of course, when federal law preempts the area and precludes further state proceedings as, e.g., when a defendant files bankruptcy. (See 11 U.S.C.A., Sec. 362.)

When a federal action has been filed covering the same subject matter involved in an action in California state courts, the California state court has the discretion but not the obligation to stay the state court action. (Benitez v. Williams (2013) 219 Cal.App.4th 270, 276, citing to Caiafa Prof. Law Corp. v. State Farm Fire & Cas. Co. (1993) 15 Cal.App.4th 800, 804 (Caiafa), citations omitted.) When a California resident seeks to litigate California state law claims against California residents in California state court, the superior court should give the plaintiff's choice of forum great deference. (Benitez, supra, at p. 277.)

For purposes of determining whether to stay state court action in favor of federal action, the court should consider (1) the importance of discouraging multiple litigation designed solely to harass an adverse party, (2) the importance of avoiding unseemly conflicts with courts of other jurisdictions, and (3) whether federal action is pending in the same state as the state court action. (Mave Enterprises, Inc. v. Travelers Indemnity Co. (2013) 219 Cal.App.4th 1408, 1424 (Mave Enterprises), as modified Oct. 23, 2013, citing to Caiafa, supra, 15 Cal.App.4th at p. 804, citations omitted.)

Pendency in federal court of an action that will not affect the right of recovery in a subsequent action in a state court does not authorize a stay of proceedings in the latter action, particularly where the parties are not identical between the state and federal actions. (See Farmland Irr. Co. v. Dopplmaier (1957) 48 Cal.2d 208, 214-16 [motion by defendant for stay of proceedings pending final judgment in an Oregon federal court action was properly denied, where the parties were not identical, plaintiff had not brought the present action to harass defendant with multiple litigations, and all the issues involved in the state action were not involved in the Oregon action].) Most authorities supporting the issuance of a stay involve two related lawsuits between the same or substantially identical parties. (Gregg v. Superior Court (1987) 194 Cal.App.3d 134, 137.)

Discussion

After review, the Court finds in favor of Defendant. Critically, here we have (1) the same plaintiff across this PAGA action and in the federal class action, (2) the same Defendant in Team Industrial Services, Inc., (3) identical factual underpinnings for the PAGA claims in this action and for the violations alleged in the federal class action case (wage and hour violations). (Compare, e.g., Complaint, P.P. 2, 19 [allegations generally], 40-42 [off-the-clock work; rounding], 43-47 [overtime], 48-58 [meal periods], 59-63 [meal period premiums], 64-67 [rest breaks], 68-72 [rest break premiums], 73-76 [timely payment of wages during employment], 77-82 [waiting time penalties], 83-85 [wage statement violations], 86-89 [payroll records], 90-93 [expense reimbursements], with Motion, RJN, Ex.

A, P.P. 2, 21, 34-36 [off-the-clock work; rounding], 40-46 [overtime], 49-58 [meal periods], 58-60 [meal period premiums], 61-70 [rest breaks], 69-70 [rest break premiums], 71-76 [timely payment of wages during employment], 77-82 [wage statement violations, including, at P. 81, allegations re: reconstruction of time records, i.e., a lack of maintenance of time records], 83-87 [waiting time penalties], 88-91 [expense reimbursements].)

The pleadings in the two actions also show an overlap in the time period of violations. (Complaint, P.P. 1 [one-year PAGA period], 18 [Plaintiff employed since March 2024], 26-28 [PAGA notice fixing July 7, 2025, anchor for statutory period], with Motion, RJN, Ex. A, P.P. 1 [class begins four years prior to July 8, 2025], 20 [Plaintiff employed since March 2024], 24-25 [class definitions covering same period].)

The primary differences between the actions are: (1) the statement of a Business and Professions Code claim in the federal class action (Motion, RJN, Ex. A, P.P. 92-97), which is absent from the pleadings in this PAGA action; and (2) the type of remedy sought between the actions, i.e., civil penalties in this PAGA action as opposed to damages in the class restitution and damages in the federal class action (compare, e.g., Complaint, Prayer for Relief, P.P. 1-4 [civil penalties, injunctive relief, statutory attorneys' fees, other proper relief], with Motion, RJN, Ex. A, P.P. 1-3, 92-97 [Business and Professions claim], Prayer for Relief, P.P. 1-50 [generally, seeking mix of equitable relief and money damages].)

Defendant's moving papers note these similarities and distinctions in support of relief (Motion, pp. 1-4; see also Motion, pp. 6-7), which the Court finds support an order for stay of proceedings under the elements set forth in Mave Enterprises and Caiafa. The overlap in actionable conduct (wage and hour violations) and the secondary nature of the distinctions (Business and Professions Code claim and type of relief being derivative or following after establishment of actionable conduct) supports findings that: (1) even if there is no harassment, there is a need here to discourage multiple litigations across different actions and fora, covering the same actionable conduct, where no clear reason exists to limit proceedings of liability in federal court, i.e., the first-filed case, before addressing relief, the primary distinct in favor of the PAGA action; and (2) there is significant importance in avoiding unseemly conflicts with the Central District of California, where, for example, a jury or judicial officer may reach an inconsistent ruling or judgment than this Court as to the same allegedly actionable conduct.

Separately, (3) the federal class action is pending in the Central District of California, i.e., in the same state as the state court action. (See Opposition, 4:24-5:7 [arguing factors as disfavoring relief].) Relief is merited under these circumstances.

In opposition, Plaintiff relies on the differences in relief sought to support a denial of relief, while otherwise arguing that the factors in favor of stay do not exist here. (See, e.g., Opposition, 3-6.) The Court disagrees with both positions based on the above reasoning. To the extent that Plaintiff argues that stays of indefinite duration cannot be upheld (Opposition 6:5-12), the Court notes that Order to Show Cause hearings will remedy any prejudice as to duration of stay, with the Court to consider merits of lifting the stay at those hearings.

Plaintiff also argues that a stay is not appropriate because the parties have agreed to mediate, because the interests of the State and PAGA aggrieved employees would be prejudiced, and because concurrent jurisdiction does not require stay. (Opposition, pp. 6-9.) The Court finds none of these positions availing. The question of mediation does not appear material to the factors discussed above, where, instead, mediation may be aided by stay of these PAGA proceedings for sheer availability of greater resources. Prejudice is not clear where Plaintiff can equally prosecute claims in the federal class actions, with res judicata as to findings of fact down the road. And while it is true that relief here is discretionary, the Court is opting to grant relief.

The Court declines to further comment on other actions cited in the moving papers and not related to this PAGA action or the federal class action, which share the same plaintiff and defendant. (See Request for Judicial Notice discussion supra.)

d.

Conclusion

Defendant Team Industrial Services, Inc.'s motion for stay of proceedings is GRANTED. This action is ORDERED STAYED. The Court SETS an Order to Show Cause re: Status of Federal Class Action for 08:30 AM on December 17, 2026. The parties are ORDERED to appear at the Order to Show Cause hearing. No later than five court days prior to the Order to Show Cause hearing, the parties SHALL separately serve and file with the Court a short, no more than two-page declaration providing an update on the status of the federal class action proceedings, mediation, and other matters the parties wish to bring before the Court in relation to this PAGA action. Defendant Team Industrial Services, Inc. is ordered to give notice.

Parties who intend to submit on this tentative must send an email to the court at [email protected] indicating intention to submit on the tentative as directed by the instructions provided on the court website at www.lacourt.org. If the department does not receive an email indicating the parties are submitting on the tentative and there are no appearances at the hearing, the motion may be placed off calendar. If a party submits on the tentative, the party's email must include the case number and must identify the party submitting on the tentative. If the parties do not submit on the tentative, they should arrange to appear remotely.

DATED: September 3, 2026 _____________________________________ MARK C. KIM Judge of the Superior Court Case Number: 25STCV33331 Hearing Date: September 3, 2026 Dept: 731 SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF LOS ANGELES - CENTRAL DISTRICT RAJDEV SINGH, Plaintiff, vs. GENERAL MOTORS, LLC; AND DOES 1- 100, INCLUSIVE, Defendants. |))))))))))) |