This next case highlights the difficulty of successfully eliminating a wage and hour class action in California at the demurrer stage. After 3 bites at the apple, the trial judge in Gutierrez v. California Commerce Club, Inc., 2010 WL 2991875 (Cal. Ct. App. 2d Dist. August 02, 2010) (not reported) sustained without leave to amend the defendant California Commerce Club, Inc.’s (“Club”) demurrer to plaintiff’s third amended complaint on the ground the plaintiffs had failed to show the existence of a class, and dismissed the action as to all representative claims. In a 3-0 opinion, Justice Jeffrey J. Johnson, writing for the Second District Court of Appeal, reversed the trial court’s order.
Putative class representatives Sergio Gutierrez and Hector Salazar filed the operative third amended class action complaint against the Club, alleging, among other things, that they and other similarly situated members of the putative class were injured by the Club’s unlawful policy and practice of denying meal and rest breaks to certain hourly, non-union employees.
The Court of Appeal held that “In this action, as in the vast majority of wage and hour disputes, class suitability should not be determined on demurrer.”
Plaintiffs alleged that, pursuant to a Club policy or practice, they and similarly situated hourly, non-union employees have been denied meal and rest breaks to which they are legally entitled, or compensation therefor. The Court reasoned that “[o]n these allegations, it is clear that the Club liability, if any, to the class as a whole, can be determined by reviewing a single or set of facts common to all.” Id. *6. The Court wrote:
We return again to and rely upon the well-established principle, that “only in mass tort actions (or other actions equally unsuited to class action treatment) [should] class suitability … be determined at the pleading stage. In other cases, particularly those involving wage and hour claims, [such as the instant action,] class suitability should not be determined by demurrer.” ( Prince, supra, 118 Cal.App.4th at p. 1325, italics added; see also Tarkington, supra, 172 Cal.App.4th at p. 1512.). Id.
We will reverse the order dismissing the action following the sustaining without leave to amend of the demurrer to the TAC based on the trial court’s finding that the pleading failed “to allege facts sufficient to show the existence of a class.” It was premature for the trial court to make determinations pertaining to class suitability on demurrer. The allegations of the operative complaint are sufficient to move the action beyond the pleading stage.
The appeal was taken from an order of Judge Aurelio Munoz of the Superior Court of Los Angeles County. (Judge Munoz is a retired judge of the L.A. Sup. Ct. assigned by the Chief Justice pursuant to art. VI, § 6 of the Cal. Const.). Matthew J. Matern and Thomas S. Campbell appeared for Plaintiffs and Appellants. Anna Segobia Master and Jennifer Rappoport appeared for Defendant and Respondent.
By CHARLES H. JUNG