Hutchinson v. Fry's Electronics CA4/1 (2015) · DecisionDepot
Hutchinson v. Fry's Electronics CA4/1
California Court of Appeal Jan 15, 2015 No. D063219Unpublished
Filed 1/15/15 Hutchinson v. Fry’s Electronics CA4/1 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
CHARLES HUTCHINSON, D063219
Plaintiff and Appellant,
v. (Super. Ct. No. 37-2012-00054281- CU-OE-NC) FRY'S ELECTRONICS, INC.,
Defendant and Respondent.
APPEAL from a judgment of the Superior Court of San Diego County, Timothy
M. Casserly, Judge. Reversed.
Marcus Jackson; Arbogast Law and David M. Arbogast for Plaintiff and
Appellant.
Sheppard, Mullin, Richter & Hampton, Richard J. Simmons, Matthew M. Sonne
and Jonathan P. Barker for Defendant and Respondent.
In this case, our Supreme Court's recent opinion in Iskanian v. CLS Transportation
Los Angeles, LLC (2014) 59 Cal.4th 348, 382-389 (Iskanian) compels us to reverse the
trial court's order dismissing representative claims plaintiff and appellant Charles
Hutchinson brought under the Labor Code Private Attorneys General Act of 2004
(PAGA) (Lab. Code, § 2698 et seq.) against his employer, an electronics retailer,
defendant and respondent Fry's Electronics, Inc. (Fry's). In Iskanian, the court held that
representative PAGA claims are claims brought on behalf of the state and may not,
As we have seen, the court in Iskanian has made it clear that an employee is acting
as an agent of the state when he or she brings a PAGA representative action and that the
state is the real party in interest. (Iskanian, supra, 59 Cal.4th at pp. 386-387.) As the
court stated, a representative PAGA claim is: "a dispute between an employer and the
state, which alleges directly or through its agents—either the [Labor and Workforce
Development] Agency or aggrieved employees—that the employer has violated the
Labor Code. Through his PAGA claim, [plaintiff] is seeking to recover civil penalties,
9
75 percent of which will go to the state's coffers. We emphasized in Arias that 'an action
to recover civil penalties "is fundamentally a law enforcement action designed to protect
the public and not to benefit private parties"'; that '[i]n a lawsuit brought under the
[PAGA], the employee plaintiff represents the same legal right and interest as state labor
law enforcement agencies'; and that 'an aggrieved employee's action under the [PAGA]
functions as a substitute for an action brought by the government itself.' [Citation.] The
fact that any judgment in a PAGA action is binding on the government confirms that the
state is the real party in interest. [Citation.] It is true that 'a person may not bring a
PAGA action unless he or she is "an aggrieved employee" [citation]' [citation], but that
does not change the character of the litigant or the dispute. As Justice Chin correctly
observes, 'every PAGA action, whether seeking penalties for Labor Code violations as to
only one aggrieved employee—the plaintiff bringing the action—or as to other
employees as well, is a representative action on behalf of the state.' [Citation.]"
(Iskanian, supra, 59 Cal.4th at pp. 386-387.)
In light of the fact that in asserting his representative PAGA claims Hutchinson is
acting as an agent of the state and the state is the real party in interest on that claim,
Hutchinson's appeal falls within the well-established doctrine that "[w]hen a party brings
an action in multiple capacities, a judgment determining that party's rights in one capacity
may be final even though the action is still pending on a claim brought in a different
capacity." (First Security Bank of Cal. v. Paquet (2002) 98 Cal.App.4th 468, 474; see
Dominguez v. City of Alhambra (1981) 118 Cal.App.3d 237, 241.) Accordingly, we deny
Fry's motion to dismiss the appeal.
10
III
Turning to the merits of Hutchinson's claim, in light of Iskanian it is clear that we
must reverse that portion of the trial court's order dismissing Hutchinson's representative
PAGA claim. As the court in Iskanian held, notwithstanding any arbitration agreement
to the contrary, an employer such as Fry's must answer an employee's "representative
PAGA claims in some forum." (Iskanian, supra, 59 Cal.4th at p. 391.) Contrary to Fry's
contention, Hutchinson's representative PAGA claims cannot be distinguished from those
asserted in Iskanian on the grounds that unlike the agreement discussed in Iskanian, the
Fry's employment agreement does not expressly waive the right to assert representative
claims. Here, at Fry's behest, the trial court effectively implied such a waiver by finding
that the arbitration agreement only permitted the pursuit of individual PAGA claims in
arbitration and that, as result, Hutchinson could not separately pursue a representative
claim. The holding in Iskanian makes it clear that the trial court erred in this regard:
Hutchinson may, on behalf of the state, pursue a representative PAGA claim. (Ibid.)
Although Fry's asks that we stay Hutchinson's appeal until any possible
proceedings in the United States Supreme Court in Iskanian are final or, in the
alternative, that we direct the trial court to stay litigation of Hutchinson's PAGA claim
until arbitration is complete, we decline these requests. Under Auto Equity Sales, Inc. v.
Superior Court (1962) 57 Cal.2d 450, 455, we are bound by our Supreme Court's
decision in Iskanian and any stay of Hutchinson's appeal would be predicated on wholly
inappropriate speculation that there is some defect in that decision. With respect to the
request that we direct the trial court to stay the PAGA claims until resolution of
Hutchinson's arbitrable claims is complete, this is a request that should in the first
11
instance be made in the trial court, which, in resolving that question, will now have the
benefit of the court's decision in Iskanian. We express no opinion with respect to how
the trial court should resolve the question of any stay.1
DISPOSITION
The trial court's order dismissing Hutchinson's PAGA claims is reversed and
remanded for further proceedings consistent with the views we have expressed.
BENKE, Acting P. J.
WE CONCUR:
NARES, J.
IRION, J.
1 We recognize that in his opening brief Hutchinson argued that rather than dismissing his representative PAGA claims, the trial court should have, at most, stayed them. Hutchinson's opening brief was evidently prepared without the benefit of the Supreme Court's opinion in Iskanian. Hutchinson's reply brief suggests that he no longer believes a stay of his PAGA claim would be appropriate. Plainly, Hutchinson can make his desires with respect to a stay clear on remand. In this regard, we note that the court in Iskanian found that PAGA claims were not preempted by the FAA because they are disputes between employers and the state. (Iskanian, supra, 59 Cal.4th at pp. 386-387.) We also recognize that Fry's arbitration agreement is silent with respect to whether class or representative claims are arbitrable and that courts have interpreted this silence as meaning that representative and class claims are not arbitrable. (See Stolt-Nielsen S.A. v. AnimalFeeds International Corp. (2010) 559 U.S. 662, 684-687.) 12
AI Brief
AI-generated · verify before citing
Holding. Representative claims brought under the Labor Code Private Attorneys General Act (PAGA) cannot be waived by an employee and are not preempted by the Federal Arbitration Act. Consequently, an employer must answer such representative claims in either an arbitral or judicial forum.
Issues
Whether an employee's representative PAGA claims can be waived by an arbitration agreement.
Whether the Federal Arbitration Act preempts an employee's right to pursue representative PAGA claims.
Whether an order dismissing a representative PAGA claim is appealable when individual claims are ordered to arbitration.
Disposition. reversed
Quotations verified verbatim against the opinion
“representative PAGA claims are claims brought on behalf of the state and may not, therefore, be waived by an employee”
“an employee's right to pursue representative PAGA claims are not preempted by the Federal Arbitration Act”
“where, as here, an employment agreement compels the waiver of representative claims under the PAGA, it is contrary to public policy and unenforceable as a matter of state law.”