Salazar v. Driver Provider Phoenix LLC ( 2023 )

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 Kelli Salazar, et al., No. CV-19-05760-PHX-SMB 10 Plaintiffs, ORDER 11 v. 12 Driver Provider Phoenix LLC, et al., 13 Defendants. 14 15 Before the Court is Plaintiffs’ Renewed Motion for Rule 23 Certification of Claims 16 Under the Arizona Wage Act. (Doc. 456.) Defendants filed a Response (Doc. 464), and 17 Plaintiffs filed a Reply (Doc. 476). Oral argument was held on November 13, 2023. After 18 reviewing the parties’ arguments and the relevant law, the Court will deny Plaintiffs’ 19 Motion for the reasons set forth below. 20 I. BACKGROUND 21 Plaintiffs’ Motion seeks class certification on Count II of the Fifth Amended 22 Complaint—violation of the Arizona Wage Act (“AWA”), A.R.S. § 23-350, et seq. 23 Previously the Court certified claims for violations of the Arizona Minimum Wage Act as 24 follows: 25 All current and former employees of The Driver Provider who performed chauffeur services in Arizona at any time from December 6, 2016 to the 26 present. Excluded from the class are all owners, managers, supervisors, 27 dispatchers, or other employees whose primary job responsibilities were not the provision of chauffeur services. 28 (Doc. 427 at 14.) Plaintiffs’ now seek to add the AWA straight time claims to the 1 previously certified class. 2 II. LEGAL STANDARD 3 “Parties seeking class certification bear the burden of demonstrating that they have 4 met each of the four requirements of Federal Rule of Civil Procedure 23(a) and at least one 5 of the requirements of Rule 23(b).” Ellis v. Costco Wholesale Corp., 657 F.3d 970, 979– 6 80 (9th Cir. 2011) (citing Zinser v. Accufix Rsch. Inst., Inc., 253 F.3d 1180, 1186 (9th Cir. 7 2001)). Rule 23(a)–(b) read as follows: 8 (a) Prerequisites. One or more members of a class may sue or be sued as representative parties on behalf of all members only if: 9 (1) the class is so numerous that joinder of all members is 10 impracticable; (2) there are questions of law or fact common to the class; 11 (3) the claims or defenses of the representative parties are typical of 12 the claims or defenses of the class; and (4) the representative parties will fairly and adequately protect the 13 interests of the class. 14 (b) Types of Class Actions. A class action may be maintained if Rule 23(a) is satisfied and if: 15 (1) prosecuting separate actions by or against individual class 16 members would create a risk of: (A) inconsistent or varying adjudications with respect to 17 individual class members that would establish incompatible 18 standards of conduct for the party opposing the class; or (B) adjudications with respect to individual class members 19 that, as a practical matter, would be dispositive of the interests 20 of the other members not parties to the individual adjudications or would substantially impair or impede their ability to protect 21 their interests; (2) the party opposing the class has acted or refused to act on grounds 22 that apply generally to the class, so that final injunctive relief or 23 corresponding declaratory relief is appropriate respecting the class as a whole; or 24 (3) the court finds that the questions of law or fact common to class 25 members predominate over any questions affecting only individual members, and that a class action is superior to other available methods 26 for fairly and efficiently adjudicating the controversy. The matters 27 pertinent to these findings include: (A) the class members’ interests in individually controlling the 28 prosecution or defense of separate actions; 1 (B) the extent and nature of any litigation concerning the controversy already begun by or against class members; 2 (C) the desirability or undesirability of concentrating the 3 litigation of the claims in the particular forum; and (D) the likely difficulties in managing a class action. 4 A plaintiff seeking class certification must “affirmatively demonstrate his 5 compliance with the Rule—that is, he must be prepared to prove that there are in fact 6 sufficiently numerous parties, common questions of law or fact, etc.” Wal-Mart Stores, 7 Inc. v. Dukes, 564 U.S. 338, 350 (2011). Likewise, when considering class certification 8 courts must engage in “a rigorous analysis.” Id. at 350–51 (quoting Gen. Tel. Co. of Sw. v. 9 Falcon, 457 U.S. 147, 161 (1982)). The Rule 23 analysis may “entail some overlap with 10 the merits of the plaintiff’s underlying claim,” id. at 351, but it “grants courts no license to 11 engage in free-ranging merits inquiries at the certification stage.” Amgen Inc. v. Conn. Ret. 12 Plans & Tr. Funds, 568 U.S. 455, 466 (2013). “Merits questions may be considered to the 13 extent—but only to the extent—that they are relevant to determining whether the Rule 23 14 prerequisites for class certification are satisfied.” Id.; see also United Steel, Paper & 15 Forestry, Rubber, Mfg. Energy, Allied Indus. & Serv. Workers Int’l Union, AFL-CIO v. 16 ConocoPhillips Co., 593 F.3d 802, 808 (9th Cir. 2010) (“Although certification inquiries 17 such as commonality, typicality, and predominance might properly call for some 18 substantive inquiry, the court may not go so far . . . as to judge the validity of these claims.” 19 (cleaned up)). In fact, “[n]either the possibility that a plaintiff will be unable to prove his 20 allegations, nor the possibility that the later course of the suit might unforeseeably prove 21 the original decision to certify the class wrong, is a basis for declining to certify a class 22 which apparently satisfies [Rule 23].” United Steel, 593 F.3d at 809 (quoting Blackie v. 23 Barrack, 524 F.2d 891, 901 (9th Cir. 1975)). 24 Nevertheless, “plaintiffs must prove the facts necessary to carry the burden of 25 establishing that the prerequisites of Rule 23 are satisfied by a preponderance of the 26 evidence.” Olean Wholesale Grocery Coop., Inc., v. Bumble Bee Foods LLC, 31 F.4th 27 651, 665 (9th Cir. 2022). “Failure to meet any one of the requirements set forth in Rule 23 28 1 precludes class certification.” Miller v. Am. Standard Ins. Co. of Wis., 759 F. Supp. 2d 2 1144, 1146 (D. Ariz. 2010). 3 III. DISCUSSION 4 A. Rule 23(a) 5 1. Numerosity 6 Plaintiffs argue numerosity is met, and Defendants do not object. Under the 7 numerosity requirement, a proposed class of at least 40 members is typically satisfactory. 8 See Horton v. USAA Cas. Ins. Co., 266 F.R.D. 360, 365 (D. Ariz. 2009). Here, there are 9 475 Drivers included in the class and 399 of them worked for Defendants within the one- 10 year statute of limitations. (Doc. 457 at 2.) The Court finds the numerosity requirement 11 satisfied. See Vega v. All My Sons Bus. Dev. LLC, 583 F. Supp. 3d 1244, 1264 (D. Ariz. 12 2022) (finding the numerosity requirement satisfied for an Arizona unpaid wages class of 13 potentially 200 members); see also Juvera v. Salcido, 294 F.R.D. 516, 521 (D. Ariz. 2013) 14 (finding numerosity satisfied with AMWA class of “approximately 200” members). 15 2. Commonality 16 Plaintiffs next argue commonality is met, and Defendants do object. To prove 17 commonality, there must be a “common contention” that is “of such a nature that it is 18 capable of classwide resolution—which means that determination of its truth or falsity will 19 resolve an issue that is central to the validity of each one of the claims in one stroke.” Wal- 20 Mart, 564 U.S. at 350. A plaintiff need only present “a single common question of law or 21 fact that resolves a central issue.” Castillo v. Bank of Am., NA, 980 F.3d 723, 728 (9th Cir. 22 2020). To satisfy the requirement, not every issue of law and fact need to be common. 23 Juvera, 294 F.R.D. at 521. “The existence of shared legal issues with divergent factual 24 predicates is sufficient, as is a common core of salient facts coupled with disparate legal 25 remedies within the class. Id. (quoting Meyer v. Portfolio Recovery Assocs., LLC, 707 F.3d 26 1036, 1041 (9th Cir. 2012)). “However, [i]f there is no evidence that the entire class was 27 subject to the same allegedly [illegal] practice, there is no question common to the class.” 28 Vega, 583 F. Supp. 3d at 1261 (quoting Ellis, 657 F.3d at 983) (internal quotation marks 1 omitted). Yet, “[a] common contention need not be one that ‘will be answered, on the 2 merits, in favor of the class.’” Alcantar v. Hobart Serv., 800 F.3d 1047, 1053 (9th Cir. 3 2015) (quoting Amgen, 568 U.S. at 459). 4 Here, Plaintiffs are seeking damages related to pre- and post-trip work which they 5 claim was not paid. Plaintiffs note that all full-time Drivers are required to arrive at least 6 one hour ahead of their first scheduled pickup and must perform pre- and post-trip work 7 each time they operate a Driver Provider vehicle. These duties are more specifically 8 detailed in Plaintiffs’ Motion for Partial Summary Judgment (Doc. 497) and their 9 Statement of Facts (Doc. 498). It is undisputed that this time was not tracked. Defendants 10 estimate work time using SantaCruz trip records. This tracks time for individual trips but 11 is not a typical time keeping system that records the start and end of each shift. It is 12 Defendants position that the pre- and post-trip work is compensated by the commissions 13 paid to Drivers. 14 A.R.S. § 23-355(A) states: “[E]xcept as provided in subsection B of this section, if 15 an employer, in violation of this chapter, fails to pay wages due any employee, the 16 employee may recover in a civil action against an employer or former employer an amount 17 that is treble the amount of the unpaid wages.” “Wages” are defined as “nondiscretionary 18 compensation due an employee in return for labor or services rendered by an employee for 19 which the employee has a reasonable expectation to be paid whether determined by a time, 20 task, piece, commission or other method of calculation.” A.R.S. § 23-350(7) (emphasis 21 added). 22 A “reasonable expectation” may be defined contractually either (1) expressly, (2) 23 by an “implied contract between the parties based upon their past dealings,” Zavaleta v. 24 OTB Acquisition LLC, No. CV-19-04729-PHX-JAT, 2021 WL 824419, at *5 (D. Ariz. 25 Mar. 4, 2021) or (3) by an employer's “policy or practice [to pay] such compensation.” 26 Morgan v. Freightliner of Ariz., LLC, No. CIV 16-498-TUC-CKJ, 2017 WL 2423491, at 27 *7 (D. Ariz. June 2, 2017). Additionally, the Ninth Circuit permits courts to look to the 28 understanding of the parties to determine the scope of pay policies—such as pre- and post- 1 trip work. See Ayala v. U.S. Xpress Enters., Inc., 851 F. App’x 53 (9th Cir. 2021) (mem.). 2 The plaintiff in Ayala alleged that a motor carrier’s mileage-based compensation 3 system paid for driving time only, and that “non-driving tasks” like fueling, pre-trip and 4 post-trip inspections, and waiting at customer sites and terminals were unpaid. Ayala v. 5 U.S. Xpress Enters., Inc., No. EDCV 16-137-GW-KKx, 2020 WL 3071707, at *1 (C.D. 6 Cal. June 9, 2020). The district court granted summary judgment to the employer, finding 7 that “the driver’s pay does not depend on the actual number of miles driven” and the 8 employer’s “compensation in effect pays a fixed-fee per trip.” Id. at *8. Therefore, the 9 court held that the plaintiff overlooked “the fact that [the defendant] pays a fixed sum to 10 its drivers for each trip—an amount the drivers are informed of in advance. The mileage, 11 X, associated with a trip, is merely used as an intermediate step in arriving at the final 12 fixed-fee amount.” Id. at *11. The district court also rejected the plaintiff’s position that 13 “any system denominated in miles requires supplemental pay for non-driving tasks” and 14 found that the argument “attach[es] too much importance to form over substance.” Id. at 15 *10–*11. The Ninth Circuit affirmed, holding that wage laws exist “to ensure that workers 16 receive adequate and fair pay, not to dictate employers and employees what pay formulas 17 they may, or may not, agree to adopt as a means to that end” and approved of the district 18 court looking to the understanding of the parties to determine the pay policy. 851 F. App’x 19 at 54 (quoting Oman v. Delta Air Lines, 466 P.3d 325, 341 (Cal. Ct. App. 2020)). 20 In this case, there is a dispute as to whether there was a contract that applied to all 21 Drivers. Defendants have consistently maintained that all Drivers are paid pursuant to the 22 commission plan. (See, e.g., Doc. 506 at 27.) Plaintiffs, on the other hand, have said in 23 this litigation that the Drivers did not know how they were paid and most did not sign or 24 receive the “commission plan.” (Doc. 533 at 6–8.) It appears that Plaintiffs are arguing 25 the failure to pay wages based on an implied contract, but the current motion is not clear 26 on this point. Plaintiffs have also argued that some Drivers relied on job ads that offered 27 specific hourly rates or hourly rate equivalents and expected to be paid that hourly rate. 28 (Doc. 476 at 12; Doc. 533 at 3–4.) As such, Plaintiffs’ proposed class includes some ! Drivers covered by the commission plan with no expectation of additional pay, some 2 Drivers covered by the commission plan with an expectation of additional pay, and some Drivers that allege they are paid hourly based on the advertisement. Each of these 4 constitute a different “reasonable expectation” between each Driver and Driver Provider 5 based on the understanding of the parties. However, when asked about this issue at oral 6 argument, Plaintiffs attempted to cast pay as a common question, stating “[W]hether the drivers reasonably expected to be compensated for the pre- and post-trip work that 8 defendants directed them to perform, and agree, the defendants agree here that the drivers 9 should be paid for that work, that’s going to be answered the same way across the class for 10 everybody.” This statement is overbroad and overlooks the controlling law. i Here, the Drivers did in fact have differing expectations of how they would be paid. 12 Therefore, there is no common question as to whether Drivers should be compensated for 13 the pre- and post-shift work. Instead, the question requires individual analysis of each \4 Driver’s reasonable expectation and individual analysis of what implied contract existed between each Driver and Driver Provider. Accordingly, Plaintiffs have not met their 16 burden to show commonality. Because the Court finds that commonality is not met, the Court will not address 18 typicality or adequacy. In conclusion, Plaintiffs have failed to satisfy Rule 23(a). 19 V. CONCLUSION 20 Accordingly, 71 IT IS ORDERED that Plaintiffs’ Renewed Motion for Rule 23 Certification of 22 Claims Under the Arizona Wage Act is denied. (Doc. 456.) 23 IT IS FURTHER ODERED affirming the collective action for minimum wage 24 violations (which require no analysis of various methods of payment but just hours worked) 25 and overtime violations based on minimum wage. 26 Dated this 18th day of December, 2023. 27 8 ose Aionorable Susan M. Brnovich □□ , United States District Judge