Turrieta v. Lyft, Inc. ( 2021 )

Filed 9/30/21
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION FOUR
TINA TURRIETA, B304701
Plaintiff and Respondent, (Los Angeles County
Super. Ct. No. BC714153)
v.
LYFT, INC.,
Defendant and Respondent;
MILLION SEIFU et al.,
Movants and Appellants.
APPEAL from a judgment of the Superior Court of
Los Angeles County, Dennis J. Landin, Judge. Affirmed.
Lichten & Liss-Riordan, Shannon E. Liss-Riordan, Anne
Kramer for Appellant Million Seifu.
Outten & Golden, Jahan C. Sagafi, Laura Iris Mattes and
Adam Koshkin; Olivier Schreiber & Chao, Monique Olivier,
Christian Schreiber and Rachel Bien for Appellant Brandon
Olson.
Michael L. Smith as Amicus Curiae on behalf of Appellants.
The Graves Firm, Allen Graves and Jacqueline Treu for
Plaintiff and Respondent.
Horvitz & Levy, Christopher D. Hu, Peder K. Batalden, and
Felix Shafir; Keker, Van Nest & Peters, R. James Slaughter, Erin
E. Meyer, Ian Kanig and Morgan E. Sharma for Defendant and
Respondent.
Appellants Brandon Olson and Million Seifu and
respondent Tina Turrieta worked as drivers for a rideshare
company, respondent Lyft, Inc. In 2018, Olson, Seifu, and
Turrieta each filed separate representative actions against Lyft
under the Private Attorneys General Act of 2004 (PAGA) (Lab.
Code, § 2698 et seq.),1 alleging that Lyft misclassified its
California drivers as independent contractors rather than
employees, thereby violating multiple provisions of the Labor
Code. Following a mediation in 2019, Turrieta and Lyft reached
a settlement.
After Turrieta moved for court approval of the settlement,
appellants sought to intervene in the matter and object to the
settlement. Appellants argued that Lyft had engaged in a
“reverse auction” by settling with Turrieta for an unreasonably
low amount, and that the settlement contained other provisions
that were unlawful and inconsistent with PAGA’s purpose. The
trial court rejected appellants’ requests to intervene, finding that
appellants lacked standing. The court found the settlement to be
fair and adequate, and approved it. The court also denied the
1All further statutory references are to the Labor Code
unless otherwise indicated.
2
subsequent motions by appellants to vacate the judgment under
Code of Civil Procedure section 663.
On appeal, appellants contend the trial court erred in
approving the settlement, and in denying their motions to
intervene and to vacate the judgment. Respondents argue that,
as nonparties, appellants lack standing to seek any relief in this
case, and further, that the settlement was proper. We agree with
respondents and the trial court that appellants’ status as PAGA
plaintiffs in separate actions does not confer standing to move to
vacate the judgment or challenge the judgment on appeal.
Moreover, while appellants may appeal from the court’s implicit
order denying them intervention, we find no error in that denial.
We therefore affirm.
FACTUAL AND PROCEDURAL HISTORY
I. Initiation of PAGA Lawsuits by Drivers
Olson, Seifu, and Turrieta each worked as drivers for Lyft.
As alleged by Turrieta, Lyft is a transportation company that
employs drivers to transport customers by automobile. Lyft uses
a cell phone application to connect its drivers with riders seeking
transportation. During the relevant period, Lyft “maintained a
uniform policy of classifying all Drivers as independent
contractors rather than employees.”
On May 24, 2018, Olson filed his lawsuit, Olson v. Lyft, Inc.
(Super. Ct. San Francisco County, No. CGC-18-566788) (Olson),
alleging PAGA claims on behalf of the State of California and
other similarly situated individuals who worked as drivers for
Lyft in California. He alleged that Lyft willfully misclassified its
drivers as independent contractors resulting in numerous Labor
Code violations, and sought recovery of civil penalties under
PAGA. Seifu filed his lawsuit on July 5, 2018, captioned Seifu v.
3
Lyft, Inc. (Super. Ct. Los Angeles County, No. BC712959) (Seifu),
also alleging PAGA claims based on driver misclassification.2
Turrieta filed the instant case on July 13, 2018 (Turrieta).
Turrieta’s complaint alleged six claims under PAGA for willful
misclassification, failure to pay overtime wages, failure to timely
pay wages, failure to pay wages upon termination, failure to
provide accurate itemized paystubs, and failure to reimburse
business expenses.
In April 2019, Olson filed a petition to coordinate five
actions against Lyft pending in San Francisco and Los Angeles
Superior Courts, including Olson, Seifu, and Turrieta. Lyft
opposed the petition, as did Seifu and several other plaintiffs.
The Olson court denied the petition without prejudice, noting
that four of the five cases were currently stayed—Seifu and Olson
pending resolution of appeals and Turrieta pending resolution of
Seifu.3
II. Settlement in Turrieta
In September 2019, Turrieta and Lyft reached a settlement
of her case following a mediation. Turrieta and Lyft signed the
settlement agreement on December 4, 2019. The proposed
settlement covered all individuals who provided at least one ride
as a driver on Lyft’s platform from April 30, 2017 to December
31, 2019. Lyft estimated the group to include a maximum of
565,000 individuals. The settlement required Lyft to pay $15
2 During oral argument, counsel for Seifu and Olson
clarified that Olson added his PAGA claims to his existing
complaint in July 2018, after Seifu had filed his PAGA complaint.
Thus, Seifu was the first of these three plaintiffs to file the PAGA
claims at issue here.
3 We granted Olson’s request for judicial notice of the
petition and court’s order regarding coordination in Olson.
4
million in total, including a $14,000 enhancement payment to
Turrieta, $5,048,087.34 in attorney fees and costs to Turrieta’s
counsel, $6,071,978.17 to be paid to PAGA group members,4 and
$3,215,934.50 in penalties paid to the state. Turrieta estimated
that group members would receive an average payment of $12.
Under the settlement, the parties agreed to file a first
amended complaint in Turrieta that “covers all PAGA claims that
could have been brought against Lyft” for the relevant time
period, so that those claims would be released by the settlement.
In the proposed first amended complaint, Turrieta alleged four
additional claims for failure to provide breaks, failure to store
records, failure to pay minimum wage, and failure to provide
hiring notice. The settlement expressly exempted from release
any claims for damages (as opposed to penalties) and direct
claims by group members other than Turrieta. On December 9,
2019, Turrieta gave notice of the settlement to the state through
the California Labor and Workforce Development Agency
(LWDA), including a copy of the settlement agreement and the
proposed first amended complaint. The LWDA did not respond.5
On December 9, 2019, Turrieta filed a motion for approval
of the settlement, with a hearing date of January 2, 2020. She
4 The amount allocated to PAGA group members represents
a $5 million payment for “underpaid wages” pursuant to section
558, subdivision (a)(3), and the balance of over $1 million as 25
percent of the recovered penalties paid to employees pursuant to
section 2699, subdivision (i).
5Although the LWDA did not respond or object to the
proposed settlement below, it did file a brief, through the Division
of Labor Standards Enforcement, as amicus curiae on appeal,
urging us to reverse the trial court’s order approving the
settlement. Turrieta filed a response to the amicus brief.
5
argued that the court should approve the settlement, as it was
“almost twice the amount of a similar settlement in the rideshare
industry that was approved in 2018,” citing Price v. Uber
Technologies, Inc. (Super. Ct. Los Angeles County, 2018, No.
BC554512). Turrieta stated that she and Lyft engaged in
“extensive informal pre-mediation discovery,” including provision
by Lyft of the number of pay periods at issue, the number of
unique drivers on Lyft’s platform each week during the liability
period, and detailed data for a sample of 10,000 drivers. Based
on that data, Turrieta’s counsel “completed an extensive and
detailed calculation of the value of the claims in the case” and
estimated the maximum liability to be over $30 billion.
Turrieta acknowledged that the Supreme Court’s recent
decision in Dynamex Operations West, Inc. v. Superior Court
(2018) 4 Cal.5th 903 (Dynamex) established a new test that
“poses a higher hurdle for employers” to prove that a worker was
an independent contractor rather than an employee. However,
she argued that “the uncertainty as to retroactivity of this ruling,
as well as disputes as to which claims were subject to Dynamex,
rendered the impact of Dynamex uncertain.” Turrieta also
informed the court that the parties had attended a full day of
mediation in September 2019 with “noted mediator” Antonio
Piazza, but were unable to reach an agreement. However, the
mediator later “made a settlement proposal representing his own
independent valuation of the case, which the parties accepted.”
III. Motions by Olson and Seifu and Approval of Settlement
On December 24, 2019, Olson filed a motion to intervene in
Turrieta and raised objections to the settlement. He stated that
he had not been notified by Turrieta’s counsel of the proposed
settlement and only learned of it on December 20, 2019. Olson
6
argued that he was entitled to intervene as a matter of right
under Code of Civil Procedure section 387, subdivision (d)(1)
because he “(1) claims an interest in the property or transaction
that is the subject of the litigation; (2) is so situated that the
disposition of the action may impair or impede his ability to
protect that interest; and (3) will not be adequately represented
by the existing party.” Alternatively, Olson sought permissive
intervention under Code of Civil Procedure section 387,
subdivision (d)(2). Olson objected to the proposed settlement as
unfair, unreasonable, and inadequate in light of the purposes of
PAGA, arguing, among other reasons, that the amount of the
penalties paid to the state was “grossly inadequate” given the
strength of the claims. In addition, Olson asserted the settlement
was secured through a reverse auction, it was obtained by
“deliberately excluding” Olson and his counsel from the
negotiation, and it included an unjustified amount in attorney
fees.
Because the hearing on Olson’s motion was set for April
2020, he also filed an ex parte application to continue the
January 2020 settlement approval hearing until after his motion
to intervene could be heard. The court denied the application on
December 26, 2019.6
On December 31, 2019, Seifu also filed a motion for leave to
intervene in Turrieta and an objection to the proposed
settlement. Like Olson, he sought to intervene as a matter of
6 There is no transcript in the record from the hearing on
the ex parte application. In its subsequent order on January 2,
2020 approving the settlement, the court stated that it had
denied the application “after finding that there were no exigent
circumstances warranting relief.”
7
right, arguing that he had an interest in the action as a member
of the PAGA settlement group and as the PAGA representative
with the “first-filed” action. He also asked the court to postpone
the settlement approval hearing and argued that the settlement
was not fair, adequate, or reasonable.
The court held the settlement approval hearing in Turrieta
on January 2, 2020. Counsel for Turrieta argued that appellants
lacked standing to intervene or object to the settlement because
“this case belongs exclusively to the State.” He also contended
that the settlement would be “one of the largest payments” ever
received by the state, “so they of course have not objected, they
would like to be paid.” Lyft’s counsel agreed with Turrieta’s
position.
Counsel for appellants appeared at the hearing and the
court allowed them to argue. Seifu’s counsel argued that Seifu’s
case was “the first-filed case” and Lyft had engaged in a reverse
auction by settling with Turrieta after it failed to reach an
agreement with Seifu. She also argued that Seifu had moved for
an injunction in his case, which was stayed pending Lyft’s appeal,
but that Lyft was attempting to avoid the effect of potential
injunctive relief by settling a “copycat” case for monetary
penalties. She argued in the alternative that Seifu should be
allowed to opt out of the Turrieta settlement, so that “he can
continue his pursuit of his injunction claim.” Olson’s counsel
contended that the small amount of the settlement compared to
the amount of possible liability “does not represent any kind of
deterrent or punitive result for a company such as Lyft which is
currently employing hundreds of thousands of workers in
California and has billions of dollars in revenue each year.” He
also argued that other drivers should have standing to intervene
8
and appeal as they would in class actions.
In response to Seifu’s arguments, counsel for Lyft
contended that injunctive relief was not available under PAGA,
and that there was no such motion pending because Seifu was
stayed. In addition, even if injunctive relief was permitted, the
settlement would not preclude injunctive relief. He also disputed
the suggestion of gamesmanship in the settlement.
Turrieta’s counsel disputed appellants’ assertion of
standing, arguing that if the court allowed notice to or
intervention by another PAGA plaintiff, “you’d be undoing a basic
structural element of PAGA” that was distinct from class action
procedure. He also reiterated that the amount of the settlement
was reasonable compared to past settlements, and rejected the
suggestion that the state did not review the proposed settlement,
considering it was “their biggest recovery of the year.” He
emphasized that the settlement was made at arm’s length, and
was proposed by an experienced, neutral mediator. At the
conclusion of the hearing, the court took the matter under
submission.
The court issued an order later that day, January 2, 2020.
The court overruled Seifu’s objection to the settlement, finding
that “[a]part from the fact that it was filed on the eve of the
hearing, the Court does not believe that he (like Olson) has
standing to be heard on this matter.” The court held that the real
party in interest was the state, citing Amalgamated Transit
Union, Local 1756, AFL-CIO v. Superior Court (2009) 46 Cal.4th
993 (Amalgamated). The court also denied Seifu’s request to “opt
out” of the settlement, finding he had no legal basis to do so, and
was not precluded by the settlement from pursuing a preliminary
injunction.
9
The court further found that the settlement was “fair,
adequate, and reasonable in light of the time period that is
encompassed by it and the amount that will eventually be paid to
the State of California and to the hundreds of thousands of Lyft
drivers.” The court noted it had considered another settlement
approved in January 2018 for $7.75 million for a “period three
times as long.” The court also found that “although it is possible
that monetary penalties could be up to $100 billion,[7] given that
the claims in this case would likely be considered under pre-
Dynamex law, it is also possible that the penalties could be zero
dollars.” The court rejected appellants’ assertion that “Lyft
engaged in gamesmanship such that plaintiffs in other cases (as
well as the State) could be shortchanged. In this regard, the
court notes that after the parties engaged in mediation before a
very experienced mediator, they were still not able to arrive at a
resolution. Instead, they ultimately accepted the mediator’s
proposal.” In addition, the court concluded that it would “not
assume that the State of California [h]as not read and seriously
considered the proposed settlement. As mentioned above, it is
the real party in interest and by not filing an opposition to the
settlement, the Court assumes that it agrees that the settlement
is appropriate.”
The court signed the proposed order submitted by Turrieta,
approving the settlement agreement and finding the settlement
7Turrieta subsequently filed a request for clarification,
noting that the record supported a value of “over $10 billion.”
During the settlement approval hearing, Seifu’s counsel argued
that the maximum liability totaled over $2 billion, while Olson’s
counsel estimated it at over $12 billion. Ultimately, this factual
dispute is irrelevant to resolution of this appeal.
10
“is in all respects fair, reasonable and adequate, and complies
with the policy goals of the PAGA. There was no collusion in
connection with the Settlement. The Settlement was the product
of informed and arm’s-length negotiations among competent
counsel and the record is sufficiently developed to have enabled
Plaintiff and Defendant to adequately evaluate and consider their
respective positions.” The court further found that the
settlement agreement was “reasonable as it provides substantial
payment for the State of California and will provide the PAGA
Settlement Group Members with substantial recovery from a
non-reversionary common fund.” The court retained jurisdiction
to enforce the settlement agreement, vacated all other hearing
dates, and ordered the matter dismissed with prejudice. The
court entered judgment on January 6, 2020.
On January 14, 2020, Olson filed a motion to vacate the
Turrieta judgment pursuant to Code of Civil Procedure section
663. He again argued that the court erred in approving the
settlement for several reasons, including: (1) the provision paying
$5 million to drivers as underpaid wages pursuant to section 558
was barred by the recent Supreme Court decision in ZB, N.A. v.
Superior Court (2019) 8 Cal.5th 175; (2) the amount paid in
penalties to the state was unreasonable given the strength of the
claims, which the court erroneously found would not be
considered under Dynamex; (3) the court “ignored the undisputed
facts suggesting that Lyft reverse-auctioned the State’s claims”;
and (4) the court erred in finding that Olson lacked standing to
intervene. Seifu also moved to vacate the judgment on January
21, 2020.8 Lyft and Turrieta both opposed the motions.
Seifu’s motion to vacate the judgment, supporting
8
documents, and reply are not included in the record on appeal.
11
The court held a hearing on the motions to vacate the
judgment on February 28, 2020. Following argument by counsel
for appellants and respondents, the court reiterated its finding
that the settlement “is in the best interest of the workers and in
the best interest of the state of California.” Then, the court found
that appellants did not have standing to object to the settlement
or to bring a motion to set aside the judgment. The court
subsequently issued a minute order denying the motions. Olson
and Seifu timely appealed.
Respondents moved to dismiss the appeals, arguing that
appellants lacked standing. We issued an order summarily
denying the motions to dismiss without prejudice to the parties
raising the issue again in their briefing.9 The parties submitted
their briefs and appellate record. After full consideration of the
record and relevant legal authorities, we conclude that appellants
lack standing to appeal the judgment. Although they have
standing to appeal the trial court’s implicit denial of their
motions to intervene, we find no error and therefore affirm.
After filing his opening brief, he moved to augment the record
with these documents and then requested that we take judicial
notice of them. We denied both requests.
9 A summary denial of a motion to dismiss an appeal does
not “preclude later full consideration of the issue, accompanied by
a written opinion, following review of the entire record. . . .”
(Kowis v. Howard (1992) 3 Cal.4th 888, 900, overruling the
contrary holding in Pigeon Point Ranch, Inc. v. Perot (1963) 59
Cal.2d 227, 230–231; accord, Dakota Payphone, LLC v. Alcaraz
(2011) 192 Cal.App.4th 493, 509, fn. 6 [reversing prior order and
dismissing appeal upon “review of a complete record and further
analysis of the law”].)
12
DISCUSSION
I. PAGA Overview
“California’s Labor Code contains a number of provisions
designed to protect the health, safety, and compensation of
workers. Employers who violate these statutes may be sued by
employees for damages or statutory penalties. [Citations.]
Statutory penalties, including double or treble damages, provide
recovery to the plaintiff beyond actual losses incurred. [Citation.]
Several Labor Code statutes provide for additional civil penalties,
generally paid to the state unless otherwise provided. [Citation.]
Before PAGA’s enactment, only the state could sue for civil
penalties.” (Kim v. Reins International California, Inc. (2020) 9
Cal.5th 73, 80 (Kim), citing Iskanian v. CLS Transportation Los
Angeles, LLC (2014) 59 Cal.4th 348, 378 (Iskanian).) The
Legislature enacted PAGA in 2003 to allow aggrieved employees
to act as private attorneys general and recover civil penalties for
Labor Code violations. (Arias v. Superior Court (2009) 46 Cal.4th
969, 980-981 (Arias); Villacres v. ABM Industries Inc. (2010) 189
Cal.App.4th 562, 578.) The Legislature’s declared purpose in
enacting PAGA was “to supplement enforcement actions by
public agencies, which lack adequate resources to bring all such
actions themselves.” (Arias, supra, 46 Cal.4th at p. 986.)
PAGA deputizes “aggrieved” employees to bring a
representative lawsuit on behalf of the state to enforce labor
laws. (Kim, supra, 9 Cal.5th at p. 81; Iskanian, supra, 59 Cal.4th
at p. 386.) An “aggrieved employee” for purposes of bringing a
PAGA claim is defined under the statute as “any person who was
employed by the alleged violator and against whom one or more
of the alleged violations was committed.” (§ 2699, subd. (c); see
also Kim, supra, 9 Cal.5th at p. 82.) Although an aggrieved
13
employee is the named plaintiff in a PAGA action, PAGA
disputes are between the state and the employer, not between the
employee and the employer. (Iskanian, supra, 59 Cal.4th at p.
386; Arias, supra, 46 Cal.4th at p. 986 [plaintiff represents same
legal rights and interests as state labor law enforcement
agencies].) Thus, an employee suing under PAGA “does so as the
proxy or agent of the state’s labor law enforcement agencies. . . .
In a lawsuit brought under the act, the employee plaintiff
represents the same legal right and interest as state labor law
enforcement agencies—namely, recovery of civil penalties that
otherwise would have been assessed and collected by the
[LWDA].” (Arias, supra, 46 Cal.4th at p. 986; accord, Iskanian,
supra, 59 Cal.4th at p. 380.)
Before filing a PAGA lawsuit, an employee must provide
written notice to the LWDA and the employer of the specific
Labor Code violations alleged and facts and theories to support
the claims. (§ 2699.3, subd. (a)(1)(A).) “If the [LWDA] elects not
to investigate, or investigates without issuing a citation, the
employee may then bring a PAGA action.” (Williams v. Superior
Court (2017) 3 Cal.5th 531, 545 (Williams); see § 2699.3, subd.
(a)(2)(A); Julian v. Glenair, Inc. (2017) 17 Cal.App.5th 853, 866
(Julian).) The notice requirement allows the relevant state
agency to decide “whether to allocate scarce resources to an
investigation.” (Williams, supra, 3 Cal.5th at p. 546.) The LWDA
receives 75 percent of the civil penalties recovered in an action
brought by an aggrieved employee; the remaining 25 percent of
the penalties is distributed to the “aggrieved employees.”
(§ 2699, subd. (i); Arias, supra, 46 Cal.4th at pp. 980-981.)
Overlapping PAGA actions may be brought by different
employees who allege the same violations and use the same
14
theories. (Julian, supra, 17 Cal.App.5th at pp. 866-867.)
However, because an employee who brings an action under PAGA
does so as the “proxy or agent” of the state, a judgment in an
employee’s action under PAGA “binds all those, including
nonparty aggrieved employees, who would be bound by a
judgment in an action brought by the government.” (Arias,
supra, 46 Cal.4th at p. 986.) As our Supreme Court has
explained, when an employee plaintiff prevails in a PAGA action,
“[n]onparty employees may then, by invoking collateral estoppel,
use the judgment against the employer to obtain remedies other
than civil penalties for the same Labor Code violation[s].” (Id. at
p. 987.) “If the employer had prevailed, however, the nonparty
employees, because they were not given notice of the action or
afforded any opportunity to be heard, would not be bound by the
judgment as to remedies other than civil penalties.” (Ibid.; see
also Williams, supra, 3 Cal.5th at p. 547, fn. 4 [employees “do not
own a personal claim for PAGA civil penalties”].)
If the parties settle a PAGA claim, section 2699,
subdivision (l)(2) requires the plaintiff employee to
simultaneously submit the proposed settlement to the LWDA and
the court, and further requires that the court “review and
approve” the settlement. As such, the court must “ensur[e] that
any negotiated resolution is fair to those affected.” (Williams,
supra, 3 Cal.5th at p. 549.)
II. Analysis
This appeal presents overlapping challenges to two
separate orders. First, appellants seek to appeal from the
judgment on the ground that the trial court should not have
approved the settlement. They contend that they have standing
to do so because they moved to vacate the judgment under Code
15
of Civil Procedure section 663. Respondents counter that
appellants, as nonparties, lacked standing to move to vacate the
judgment and therefore cannot use those motions as a basis for
appeal. We agree with respondents and the trial court that due
to the unique nature of PAGA, in which the state is the real party
in interest, appellants had no personal interest in Turrieta and
therefore are not “aggrieved parties” who may appeal from the
judgment.
Second, appellants challenge the trial court’s denial of their
motions to intervene in Turrieta. Again, they argue that they
had a personal interest in the Turrieta proceedings and proposed
settlement because they were deputized to prosecute PAGA
claims on behalf of the state. Respondents assert that this issue
is outside the scope of the appeal and, additionally, that
appellants are not entitled to intervene. Although we agree with
appellants that they may raise this issue on appeal, we conclude
that the trial court did not err in denying them intervention.
A. Motion to vacate judgment
Respondents contend that appellants lacked standing below
to bring a motion to set aside the judgment pursuant to Code of
Civil Procedure section 663, and lack standing to appeal from the
judgment for the same reasons. We agree.
Code of Civil Procedure section 902 allows “‘[a]ny party
aggrieved’” to appeal from a judgment. Thus, “[t]he test is
twofold—one must be both a party of record to the action and
aggrieved to have standing to appeal.” (Shaw v. Hughes Aircraft
Co. (2000) 83 Cal.App.4th 1336, 1342; see also Hernandez v.
Restoration Hardware, Inc. (2018) 4 Cal.5th 260, 263
(Hernandez).) However, a nonparty that is aggrieved by a
judgment or order may become a party of record and obtain the
16
right to appeal by moving to vacate the judgment pursuant to
Code of Civil Procedure section 663. (Hernandez, supra, 4
Cal.5th at p. 267, citing Eggert v. Pac. States S. & L. Co. (1942)
20 Cal.2d 199, 201; County of Alameda v. Carleson (1971) 5
Cal.3d 730, 736, 738 (Carleson) [one who is legally “aggrieved” by
judgment may become “party of record” with the right to appeal
by moving to vacate judgment for “incorrect legal conclusion” or
“erroneous judgment upon the facts”].) Similarly, pursuant to
Code of Civil Procedure section 663, a “party aggrieved” may
move for a judgment “to be set aside and vacated . . . and another
and different judgment entered, . . . materially affecting the
substantial rights of the party and entitling the party to a
different judgment.” Thus, in order for appellants to have
standing to bring a motion to vacate the judgment or to appeal
from that judgment, they must have been “aggrieved” by the
judgment.
A party is aggrieved “only if its ‘rights or interests are
injuriously affected by the judgment.’” (Sabi v. Sterling (2010)
183 Cal.App.4th 916, 947, quoting Carleson, supra, 5 Cal.3d at p.
737.) The aggrieved party’s interest “must be immediate,
pecuniary, and substantial and not nominal or a remote
consequence of the judgment.” (Carleson, supra, 5 Cal.3d at p.
737; see also Howard Contracting, Inc. v. G.A. MacDonald
Construction Co., Inc. (1998) 71 Cal.App.4th 38, 58.)10
10 We note that whether someone is an “aggrieved
employee” as defined by section 2699, subdivision (c) and thus
able to bring a lawsuit under PAGA is a distinct inquiry from
whether a nonparty may become an aggrieved party because of a
personal interest in a different lawsuit and thereby obtain
standing to challenge the judgment. None of the parties here
17
Appellants contend they are “aggrieved” parties because of
their status as designated proxies for the state. Olson argues
that the settlement has an “‘immediate, pecuniary, and
substantial’ effect on the State (and Olson as the State’s proxy):
it extinguishes the claims Olson was deputized to pursue for less
than pennies on the dollar.” Similarly, Seifu contends that he
has “an interest in representing the State’s interest” in
“achieving the maximum recovery possible for Lyft’s misdeeds,”
and deterring future violations.
We are not persuaded that appellants’ role as PAGA
plaintiffs confers upon them a personal interest in the settlement
of another PAGA claim. As our Supreme Court recently
explained: “A PAGA claim is legally and conceptually different
from an employee’s own suit for damages and statutory penalties.
An employee suing under PAGA ‘does so as the proxy or agent of
the state’s labor law enforcement agencies.’” (Kim, supra, 9
Cal.5th at p. 81, quoting Arias, supra, 46 Cal.4th at p. 986.) As
such, “[e]very PAGA claim is ‘a dispute between an employer and
the state.’ [Citations.] . . . . Relief under PAGA is designed
primarily to benefit the general public, not the party bringing the
action.” (Ibid.; see also Iskanian, supra, 59 Cal.4th at p. 386;
Arias, supra, 46 Cal.4th at p. 986.) “‘A PAGA representative
action is therefore a type of qui tam action,’” and the “government
entity on whose behalf the plaintiff files suit is always the real
party in interest.” (Ibid., quoting Iskanian, supra, 59 Cal.4th at
p. 382.)11
have claimed otherwise.
11 As such, Seifu’s contention that he “supplanted the State
as the real party in interest” is meritless.
18
In Amalgamated, supra, 46 Cal.4th at p. 1003, the court
rejected an attempt by a labor union to bring a PAGA claim as
the assignee of the employees who had suffered injury. The court
reasoned that the claim could not be assigned because PAGA
“does not create property rights or any other substantive rights.
Nor does it impose any legal obligations. It is simply a
procedural statute allowing an aggrieved employee to recover
civil penalties—for Labor Code violations—that otherwise would
be sought by state labor law enforcement agencies.” (Ibid.) Thus,
the court held that an aggrieved employee could not assign a
PAGA claim for “statutory penalties because the employee does
not own an assignable interest.” (Ibid.)
Consequently, appellants’ ability to file PAGA claims on
behalf of the state does not convert the state’s interest into their
own or render them real parties in interest. (Amalgamated,
supra, 46 Cal.4th at p. 1003; Arias, supra, 46 Cal.4th at p. 986.)
Appellants were deputized under PAGA to prosecute their
employer’s Labor Code violations on behalf of the state; they fail
to point to any authority allowing them to act on the state’s
behalf for all purposes. Because it is the state’s rights, and not
appellants’, that are affected by a parallel PAGA settlement,
appellants are not aggrieved parties with standing to seek to
vacate the judgment or appeal.12 Nor can appellants claim a
pecuniary interest in the penalties at issue, as the “civil penalties
recovered on the state’s behalf are intended to ‘remediate present
violations and deter future ones,’ not to redress employees’
12To the extent Seifu additionally contends that his
purported status as the “first-filed” PAGA plaintiff creates a
personal interest in the settlement of a later-filed PAGA action,
he cites no authority supporting that contention.
19
injuries.” (Kim, supra, 9 Cal.5th 73, 86, quoting Williams, supra,
3 Cal.5th at p. 546; see also Iskanian, supra, at p. 381.)
We disagree with Olson’s prediction that denying him
status as an aggrieved party will “have the dangerous effect of
insulating all PAGA settlement approval orders from objection at
the trial court level and subsequent appellate review,” allowing a
plaintiff to “settle PAGA claims on patently unreasonable terms.”
PAGA expressly requires notice of a proposed settlement to both
the LWDA and the trial court, and directs the court to review the
settlement prior to approval. (§ 2699, subd. (l)(2); see also
Williams, supra, 3 Cal.5th at p. 549 [court must “ensur[e] that
any negotiated resolution is fair to those affected”].) These
procedures were followed here.13 Moreover, as evidenced by
several of the cases cited by appellants, the LWDA may provide
the trial court with comments on or objections to a proposed
settlement, and has done so in the past. (See O'Connor v. Uber
Technologies, Inc. (N.D. Cal. 2016) 201 F.Supp.3d 1110, 1113
[noting that the court “invited and considered the comments” of
the LWDA before rejecting the proposed settlement of class and
PAGA claims].) Here, the LWDA did not raise objections to the
settlement until it submitted an amicus brief on appeal, but that
does not invalidate the protections provided by PAGA’s notice
and review requirements.14
13 We also note that, while it did not allow appellants to
intervene, the trial court did allow appellants to submit
objections, and to present argument at two hearings, and it
addressed those objections (albeit briefly) in its order approving
the settlement.
14 The LWDA raises several objections to the settlement in
its amicus brief; in particular, it contends that the settlement
released claims (newly added to the FAC) that Turrieta was not
20
Appellants also argue that they are aggrieved as nonparty
employees who would be bound by the judgment. But the
settlement of Turrieta’s PAGA claims is only binding with respect
to the state’s assertion of the same PAGA claims and recovery of
the same civil penalties—not any personal claims appellants may
have against Lyft. (See Julian, supra, 17 Cal.App.5th at p. 867
[“under the doctrine of collateral estoppel, a [PAGA] judgment . . .
binds the government, as well as all aggrieved nonparty
employees potentially entitled to assert a PAGA action”].) As the
Williams court explained: “absent employees do not own a
personal claim for PAGA civil penalties (see Amalgamated[,
supra,] 46 Cal.4th [at p.] 1003), and whatever personal claims the
absent employees might have for relief are not at stake (Iskanian
deputized to pursue because she never gave the requisite 65-day
notice to the state under section 2699.3, subdivision (a). This
argument should have been addressed to the trial court below. If
the LWDA had asserted its objections before the trial court (or at
a minimum, requested more time to consider the proposal), it
could have provided the court with potentially useful information
in considering the fairness of the settlement. Instead, it did so
only belatedly and in its limited role as amicus on appeal.
Moreover, regardless of the standing issue, neither appellant
timely raised the argument that adding causes of action in the
FAC required a new notice to the state—Seifu did not raise it at
all and Olson did so only in a single paragraph at the very end of
his reply in support of his motion to vacate. This issue is
therefore forfeited and we would not consider it, even if
appellants had standing to raise it. (See St. Mary v. Superior
Court (2014) 223 Cal.App.4th 762, 783 [“points raised in a reply
brief for the first time will not be considered unless good cause is
shown for the failure to present them before”]; Balboa Ins. Co. v.
Aguirre (1983) 149 Cal.App.3d 1002, 1010.)
21
[ ], supra, 59 Cal.4th at p. 381 [“The civil penalties recovered on
behalf of the state under the PAGA are distinct from the
statutory damages to which employees may be entitled in their
individual capacities”]).” (Williams, supra, 3 Cal.5th at p. 547, fn.
4; see also Sakkab v. Luxottica Retail North America, Inc. (9th
Cir. 2015) 803 F.3d 425, 436.) Thus, the settlement forecloses
only the state’s ability to seek the same civil penalties; it does not
bar any claims owned by appellants and therefore does not injure
their personal interests.
The unique nature of a PAGA claim is further underscored
by the distinction between a PAGA claim and a class action. “In a
class action, the ‘representative plaintiff still possesses only a
single claim for relief—the plaintiff's own,’” and the class action
is used as a procedural device to aggregate numerous individual
claims. (Kim, supra, 9 Cal.5th at pp. 86-87, quoting Watkins v.
Wachovia Corp. (2009) 172 Cal.App.4th 1576, 1589.) “‘But a
representative action under PAGA is not a class action.’
[Citation.] There is no individual component to a PAGA action
because ‘every PAGA action . . . is a representative action on
behalf of the state.’” (Ibid., quoting Iskanian, supra, 59 Cal.4th
at p. 387.) As a result, unlike a class action, PAGA has no notice
requirements for unnamed aggrieved employees, nor may such
employees opt out of a PAGA action. (See Sakkab v. Luxottica
Retail North America, Inc., supra, 803 F.3d at p. 436; see also
Arias, supra, 46 Cal.4th at p. 987 [“the nonparty employees,
because they were not given notice of the action or afforded any
opportunity to be heard, would not be bound by the judgment as
to remedies other than civil penalties”].)15 Here, appellants have
15Although appellants complained to the trial court and on
appeal that they were not notified of the settlement, they cite no
22
no individual claims that would be affected by the settlement and
are therefore not “aggrieved” for the purposes of standing to move
to vacate or appeal from that judgment.
B. Motion to intervene
1. Scope of appeal
We next turn to appellants’ challenge to the court’s denial
of their motions for intervention pursuant to Code of Civil
Procedure section 387. As an initial matter, respondents contend
that appellants have not properly raised this issue on appeal
because the trial court never denied the motions and appellants
did not appeal from any such denial.
From the record before us, it appears that the court did not
issue an order specifically denying appellants’ motions to
intervene. However, Olson argues that the court effectively
denied his motion when it vacated the scheduled hearing and
denied his motion to vacate the judgment.16 We find that the
record supports the conclusion that the trial court denied
appellants’ motions for intervention.17 In its January 2, 2020
authority entitling them to such notice. Similarly, appellants
devoted much of their briefing and most of their time during oral
argument on appeal to policy arguments (despite the panel‘s
inquiries on the standing issue). The policy issues appellants
raise are best addressed to the Legislature.
16 Despite its length, Seifu’s reply brief is largely silent as to
respondents’ challenges to intervention. In his opening brief, he
commingles the discussion regarding the motion to vacate and
intervention.
17 Respondents do not dispute that an order denying
intervention would be appealable. (See Carleson, supra, 5 Cal.3d
at p. 736 [“[O]ne who is denied the right to intervene in an action
ordinarily may not appeal from a judgment subsequently entered
in the case. [Citations.] Instead, he may appeal from the order
23
order, the court addressed the issues raised by the parties
regarding intervention, expressly finding that Seifu and Olson
did not have standing to be heard, because the state was the real
party in interest. The court also vacated the scheduled hearing
on the motions to intervene. As such, the trial court’s January 2,
2020 order effectively denied appellants’ motions for intervention.
Respondents also contend that appellants appealed only
from the denial of their motions to vacate, not from any order
denying intervention. “[I]t is and has been the law of this state
that notices of appeal are to be liberally construed so as to protect
the right of appeal if it is reasonably clear what appellant was
trying to appeal from, and where the respondent could not
possibly have been misled or prejudiced.” (Etheridge v. Reins
Internat. California, Inc. (2009) 172 Cal.App.4th 908, 913,
quoting Luz v. Lopes (1960) 55 Cal.2d 54, 59; Cal. Rules of Court,
rule 8.100(a)(2).) In Seifu’s notice of appeal, he expressly
appealed from both the January 2 and February 28, 2020 orders.
Olson’s notice of appeal lists only the February 28, 2020 order
denying the motion to vacate; however, in his description of the
issues to be raised on appeal, he included the court’s refusal to
hear his motion to intervene. Moreover, all the parties addressed
the issue of intervention in their briefs on appeal. As such, we
construe appellants’ notices of appeal as taken from both the
order denying their motions to vacate the judgment and the
implicit order denying intervention.
denying intervention.”]; see also Hodge v. Kirkpatrick
Development, Inc. (2005) 130 Cal.App.4th 540, 547 (Hodge) [an
order denying a motion to intervene is appealable “because it
finally and adversely determines the moving party’s right to
proceed in the action”].)
24
2. Code of Civil Procedure section 387
Code of Civil Procedure section 387 allows either
mandatory or permissive intervention. A nonparty has a right to
mandatory intervention where “[t]he person seeking intervention
claims an interest relating to the property or transaction that is
the subject of the action and that person is so situated that the
disposition of the action may impair or impede that person's
ability to protect that interest, unless that person’s interest is
adequately represented by one or more of the existing parties.”
(Code Civ. Proc., § 387, subd. (d)(1).) Thus, “the threshold
question is whether the person seeking intervention has ‘an
interest relating to the property or transaction which is the
subject of the action.’” (Siena Court Homeowners Assn. v. Green
Valley Corp. (2008) 164 Cal.App.4th 1416, 1423, quotation
omitted; Mylan Laboratories, Inc. v. Soon–Shiong (1999) 76
Cal.App.4th 71, 78 (Mylan).)
Permissive or discretionary intervention under Code of
Civil Procedure section 387, subdivision (d)(2) also requires a
showing that “the nonparty has a direct and immediate interest
in the action,” among other criteria. (Reliance Insurance Co. v.
Superior Court (2000) 84 Cal.App.4th 383, 386.) “The
requirement of a direct and immediate interest means that the
interest must be of such a direct and immediate nature that the
moving party ‘“will either gain or lose by the direct legal
operation and effect of the judgment.”’” (City and County of San
Francisco v. State of California (2005) 128 Cal.App.4th 1030,
1036.) “Conversely, ‘[a]n interest is . . . insufficient for
intervention when the action in which intervention is sought does
not directly affect it although the results of the action may
indirectly benefit or harm its owner.’” (Ibid.)
25
3. Standard of review
The parties dispute the appropriate standard of review.
Several appellate courts have implicitly applied the de novo
standard of review to an order denying mandatory intervention.
(See, e.g., Hodge, supra, 130 Cal.App.4th at pp. 548–550; Mylan,
supra, 76 Cal.App.4th at pp. 78–80.) Turrieta, on the other hand,
argues that the applicable standard is abuse of discretion, citing
Reliance Insurance Co. v. Superior Court, supra, 84 Cal.App.4th
at p. 386. We conclude that the denial of mandatory intervention
was proper under either standard. We review the denial of
permissive intervention for an abuse of discretion. (See id. at p.
386; Truck Ins. Exchange v. Superior Court (1997) 60 Cal.App.4th
342, 345.)
4. Denial of Intervention
Appellants contend the trial court should have granted
their motions based on either mandatory or permissive
intervention. Both mandatory and permissive intervention
require a motion to intervene to be made “upon timely
application.” (Code Civ. Proc. § 387, subds. (d)(1), (2).)
Respondents argue that neither appellant’s motion was timely, as
they knew about the Turrieta action for many months but did not
seek to intervene, even after the court in Olson denied Olson’s
motion to coordinate the cases. Appellants counter that
timeliness is measured from the date the intervenors “knew or
should have known their interests were not being adequately
represented.” (Lofton v. Wells Fargo Home Mortgage, Inc. (2018)
27 Cal.App.5th 1001, 1013.) According to appellants, they had no
reason to believe their interests were not being protected by
Turrieta as another proxy until they became aware of the terms
of the settlement.
26
Although the trial court noted that Seifu’s motion to
intervene was filed on the eve of the settlement approval hearing,
it is not apparent from the record that the court made a finding of
untimeliness as a basis to deny intervention. We need not
resolve this issue. Even if we found that appellants’ motions
were timely, we nevertheless would conclude that they failed to
establish a right to intervention.
Appellants cannot meet the threshold showing that they
had a direct and immediate interest in the settlement, which
would establish their entitlement to mandatory or permissive
intervention. Appellants’ claim that they had a qualifying
interest fails for the same reason they could not establish they
were “aggrieved” for the purposes of standing. As we explained
in our discussion of standing above, appellants’ position as PAGA
plaintiffs in different PAGA actions does not create a direct
interest in Turrieta, in which they are not real parties in interest.
Appellants’ interest in pursuing enforcement of PAGA claims on
behalf of the state cannot supersede the same interest held by
Turrieta in her own PAGA case. As with standing, appellants
have no personal interest in the PAGA claims and any individual
rights they have would not be precluded under the PAGA
settlement. (Amalgamated, supra, 46 Cal.4th at p. 1003; Arias,
supra, 46 Cal.4th at p. 986.) Thus, the trial court did not err in
denying appellants’ motions to intervene.
27
DISPOSITION
The judgment is affirmed. Respondents are awarded their
costs on appeal.
CERTIFIED FOR PUBLICATION
COLLINS, J.
We concur:
MANELLA, P. J.
CURREY, J.
28