Rodriguez v. Lawrence Equipment CA2/3 ( 2024 )

Filed 10/10/24 Rodriguez v. Lawrence Equipment CA2/3
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION THREE
JULIAN RODRIGUEZ, B325261
Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. BC605692)
v.
LAWRENCE EQUIPMENT,
INC.,
Defendant and Respondent.
APPEAL from a judgment of the Superior Court of Los
Angeles County, Elihu M. Berle, Judge. Affirmed.
Lavi & Ebrahimian, Joseph Lavi, and Jordan D. Bello, for
Plaintiff and Appellant.
Lewis Brisbois Bisgaard & Smith, Jeffry A. Miller, Daniel
R. Velladao, and Steven G. Gatley, for Defendant and
Respondent.
‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗‗
INTRODUCTION
Plaintiff and appellant Julian Rodriguez sued defendant
and respondent Lawrence Equipment, Inc. (Lawrence) for wage-
and-hour violations; he also sought civil penalties and wages
pursuant to the Private Attorneys General Act of 2004 (Lab.
Code, § 2698 et seq.)1 (PAGA). The trial court ordered arbitration
of Rodriguez’s wage and hour claims, and stayed Rodriguez’s
single PAGA cause of action. The arbitrator then found in favor
of Lawrence and against Rodriguez on the alleged wage and hour
Labor Code violations. After the trial court entered judgment on
the arbitration award, Lawrence brought a motion for judgment
on the pleadings asserting that the remaining PAGA cause of
action was barred by issue preclusion since Rodriguez’s standing
as an aggrieved employee was predicated on the disproven wage
and hour violations. The trial court granted the motion and
dismissed Rodriguez’s case. Rodriguez appeals, contending for
the elements of issue preclusion have not been satisfied. We
affirm.
FACTS AND PROCEDURAL BACKGROUND
I. Rodriguez’s Employment
In April 1999, Rodriguez began working as an hourly
machine operator for Lawrence, a manufacturer of flat bread
machinery, and later became a computer numerical control
operator. In July 2014, Rodriguez executed an arbitration
agreement with Lawrence. The agreement required Rodriguez
and Lawrence to submit any dispute related to Rodriguez’s
1 All undesignated statutory references are to the Labor
Code.
2
employment to binding arbitration. Lawrence terminated
Rodriguez’s employment in October 2015.
II. Rodriguez’s Lawsuit
In December 2015, Rodriguez filed a class action against
Lawrence, alleging wage-and-hour violations. The operative first
amended complaint (FAC) alleged that Lawrence committed the
following Labor Code violations: (1) failed to pay wages for all
hours worked at the minimum wage or agreed upon rate (§§
1194, 1197); (2) failed to pay wages for all hours worked at the
overtime rate of pay (§§ 510, 1194, 1198); (3) failed to pay wages
to compensate for workdays and failed to provide adequate meal
periods (§§ 226.7, 512); (4) failed to provide adequate rest breaks
(§ 226.7); (5) provided inaccurate and incomplete wage
statements (§ 226) (fifth cause of action);2 and (6) failed to pay
wages due at the time the employment ended (§§ 201, 202, 203)
(sixth cause of action).3 The FAC also asserted Lawrence
2 As alleged in the FAC, the inaccuracies in the wage
statements for the fifth cause of action were in part derivative of
the first four causes of action alleging failure to account or
compensate for all hours worked, overtime wages, or meal and
rest period “premium wages.” Rodriguez also averred that
Lawrence “failed to accurately state the address of the legal
entity that was the employer, failed to state the inclusive dates of
the pay period, and failed to state the applicable hourly rates of
pay and corresponding number of hours worked at each hourly
rate.”
3 As alleged in the FAC, the focus of the section 201 and 202
violations was on the inadequacy, as opposed to untimeliness, of
the final wages. Rodriguez alleged that upon “separation of
employment,” Lawrence failed to pay hourly employees “unpaid
3
engaged in unfair and unlawful business practices through its
wage-and-hour violations (Bus. & Prof. Code, § 17200 et seq.).
In addition to the aforementioned claims, the FAC included
an eighth cause of action for civil penalties and wages for
Rodriguez and other aggrieved employees pursuant to PAGA.
The PAGA claim was premised on Lawrence’s alleged wage-and-
hour violations of sections 201, 202, 203,4 226, 226.7, 510, 512,
1194, 1197, and 1198, i.e., the Labor Code violations alleged in
the first six causes of action.
Lawrence moved to compel arbitration of Rodriguez’s
claims. The trial court granted Lawrence’s motion, ordered
Rodriguez to arbitrate his “non-PAGA claims” and stayed
Rodriguez’s PAGA claim, pending completion of the arbitration.5
wages at minimum wage, agreed rate, or applicable overtime rate
and unpaid meal and rest period premiums.” As such, the sixth
cause of action was solely derivative of the first four causes of
action. This interrelation is underscored in the FAC’s prefatory
language: “[b]ecause [Lawrence] failed to pay Plaintiff and other
similarly situated employees all their earned wages (including
unpaid hours worked at minimum wage, agreed rate or overtime
and unpaid meal and rest period premium wages) during their
employment or any time after their employment ended,
Defendants failed to pay those employees timely after each
employee’s termination and/or resignation.”
4 Section 202 provides for the payment of wages within 72
hours when an employee resigns, as opposed to being terminated,
and section 203 imposes penalties for an employer’s failure to
comply with sections 201 or 202.
5 In October 2016, the court dismissed the class allegations
after Rodriguez confirmed his inability to locate a substitute class
representative.
4
III. The Arbitration Proceedings
At the two-day arbitration hearing in February 2018,
Rodriguez argued that Lawrence violated the Labor Code and a
wage order from the Industrial Welfare Commission6 by failing
to: (1) pay Rodriguez for all regular and overtime hours worked;
(2) provide legally compliant meal and rest breaks; (3) provide
accurate and complete wage statements;7 and (4) timely pay all
6 According to its official website, the Industrial Welfare
Commission (IWC) “was established to regulate wages, hours and
working conditions in California,” though it is “currently not in
operation.” Instead, “[t]he Division of Labor Standards
Enforcement . . . continues to enforce the provisions of the wage
orders.” (State of California Department of Industrial Relations
website, “Industrial Welfare Commission (IWC)”
<https://www.dir.ca.gov/iwc/iwc.html> [as of Sept. 17, 2024],
archived at <https://perma.cc/LBZ4-7WC5>.) Since the particular
IWC wage order is not at issue on appeal, we do not discuss it.
Notably, Rodriguez did not allege violations of any IWC orders in
the fifth and sixth causes of action, which are the focus of this
appeal, in either his arbitration brief or in the FAC.
7 In his arbitration brief, Rodriguez ascribed the inaccurate
wage statement violations under section 226 solely to Lawrence’s
“fail[ure] to credit Mr. Rodriguez for all of the hours worked [and
as such] . . . his wage statements failed to accurately identify all
hours worked, all net wages, and all gross wages.” Whereas the
FAC referred to all nine categories of information required to be
included in a wage statement under section 226, Rodriguez’s
arbitration brief omitted any specific reference to sections 226,
subdivision (a)(6) through (8), which mandate, among other
things, the inclusion of the “dates of the period for which the
employee is paid” and “the name and address of the legal entity
that is the employer.”
5
earned and unpaid wages at the time of his termination.8 These
claims were based on three basic theories asserted by Rodriguez:
(1) he arrived at work each day five minutes early as required by
his employer and, as such, he should have been paid overtime for
working “off the clock” each day; (2) he was entitled to additional
compensation because Lawrence provided him a late meal break,
which was scheduled beyond his fifth hour of work every day; and
(3) he was entitled to additional compensation because on a daily
basis, he was denied his second 10 minute rest break.
Rodriguez’s arbitration brief also maintained that Lawrence’s
alleged Labor Code violations constituted unfair and unlawful
business practices.
In February 2018, the arbitrator issued an award in favor
of Lawrence and against Rodriguez. While acknowledging that
Rodriguez’s complaint “alleged that he had not been provided
with proper meal and rest periods . . . that he had not been
provided with accurate wage statements . . . [and] had not been
paid all earned and final wages,” the arbitrator stated Rodriguez
only presented evidence related to Lawrence’s alleged
nonpayment of hours worked and noncompliant meal and rest
breaks. The arbitrator found that Rodriguez had “failed to
sustain his burden of proof as to whether he was actually
required . . . to be at his work site five minutes” early, and “[e]ven
8 Rodriguez’s allegations regarding the untimeliness in
paying all earned and final wages as alleged in the arbitration
brief were premised solely upon and derivative of the related
allegations of Lawerence’s failure to compensate Rodriguez for
coming to work five minutes early and for Lawrence’s failure to
provide proper meal and rest breaks. As with the FAC, his
theory was one of the overall inadequacies of, as opposed to any
asserted untimeliness in providing, final wages.
6
if he had sustained his burden on this issue,” his timesheets
failed to show he was actually there before the work shift started.
The arbitrator also found that Rodriguez “received a total of
thirty minutes of rest breaks each day and a thirty minute meal
break,” and thus failed to sustain his burden that he was entitled
to additional pay for any alleged failure to provide proper meal
and rest breaks. The arbitration award stated that Rodriguez
shall take nothing by way of his complaint.
In June 2018, the trial court entered an order confirming
the arbitration award and denying Rodriguez’s motion to vacate
the award. The court entered judgment in Lawrence’s favor and
against Rodriguez as to the first through seventh causes of
action.
Rodriguez appealed the judgment confirming the
arbitration award. Another panel of this court affirmed the
judgment in an unpublished opinion, Rodriguez v. Lawrence
Equipment, Inc. (Feb. 26, 2020, B291180).
IV. Motions for Judgment on the Pleadings
Following the issuance of the remittitur, Lawrence moved
for judgment on the pleadings as to Rodriguez’s PAGA claim.
Lawrence argued in the motion that because the arbitrator found
Rodriguez failed to prove any Labor Code violations, Rodriguez
was precluded from pursuing his PAGA claim, standing for which
was predicated on those Labor Code violations.
The trial court denied Lawrence’s motion in May 2021. In
August 2022, Lawrence renewed its motion for judgment on the
pleadings, citing the United States Supreme Court’s recently
issued opinion in Viking River Cruises, Inc. v. Moriana (2022) 596
7
U.S. 639 (Viking River).9 Lawrence argued that Viking River
barred Rodriguez from maintaining his PAGA claim because he
lacked standing as his individual claims had been compelled to
arbitration.
In September 2022, the trial court granted Lawrence’s
renewed motion, stating: “This Court finds that Plaintiff cannot
state a cause of action under PAGA because Plaintiff does not
have standing as an aggrieved employee following the arbitrator’s
final ruling that Plaintiff failed to establish that he suffered any
violations under the California Labor Code.” The order further
stated, “[i]n accordance with Viking River, because Plaintiff lacks
statutory standing to continue to maintain his representative
(i.e., non-individual) claims in this Court, Plaintiff’s
representative PAGA claim is dismissed.”
9 In Viking River, the United States Supreme Court held
that the Federal Arbitration Act pre-empted an earlier ruling by
the California Supreme Court in Iskanian v. CLS Transportation
Los Angeles, LLC (2014) 59 Cal. 4th 348, which had precluded the
division of individual and non-individual claims through an
agreement to arbitrate. (Viking River, supra, 596 U.S. at p. 662.)
The Viking River court also posited that once a party’s individual
PAGA claims “ ‘ha[d] been committed to a separate proceeding[]’
. . . [the party would] lack[] ‘statutory standing’ . . . to [maintain]
her ‘non-individual’ [PAGA] claims separately in . . . court.”
(Ibid.) However, a year after the Viking River decision, the
California Supreme Court held that “where a plaintiff has filed a
PAGA action comprised of individual and non-individual claims,
an order compelling arbitration of individual claims does not
strip the plaintiff of standing to litigate non-individual claims in
court.” (Adolph v. Uber Technologies, Inc. (2023) 14 Cal. 5th
1104, 1123 (Adolph).) Our Supreme Court explained that the
representative PAGA claims may be stayed while the individual
claims are arbitrated. (Id. at p. 1124.)
8
The trial court entered a judgment of dismissal in October
2022. Rodriguez then filed a motion for a new trial to set aside
the order granting Lawrence’s renewed motion for judgment on
the pleadings, which the trial court denied.
Rodriguez timely appealed.
DISCUSSION
Rodriguez contends the trial court erred by entering
judgment dismissing his PAGA claim because the arbitrator’s
award adjudicating his non-PAGA Labor Code causes of action
had no preclusive effect on his PAGA claim. As we explain below,
Rodriguez’s PAGA standing as an aggrieved employee was
predicated on the Labor Code violations he failed to prove in
arbitration. The trial court thus properly found that the
arbitration award and resulting judgment preclude Rodriguez
from relitigating the Labor Code violations to prove standing to
maintain the PAGA cause of action.
I. Applicable Law
a. Standard of Review
“ ‘ “A motion for judgment on the pleadings is equivalent to
a demurrer and is governed by the same de novo standard of
review.” ’ ” (Travelers Property Casualty Co. of America v. Engel
Insulation, Inc. (2018) 29 Cal.App.5th 830, 834.) “Thus, ‘we are
not bound by the determination of the trial court, but are
required to render our independent judgment on whether a cause
of action has been stated.’ ” (Mendoza v. Continental Sales Co.
(2006) 140 Cal.App.4th 1395, 1401.) “All properly pleaded,
material facts are deemed true, but not contentions, deductions,
or conclusions of fact or law; judicially noticeable matters may be
considered.” (Kapsimallis v. Allstate Ins. Co. (2002) 104
9
Cal.App.4th 667, 672.) Judgment is properly “granted when the
pleadings fail to state facts sufficient to constitute a cause of
action. (Code Civ. Proc., § 430.10, subd. (e).)” (Washington v.
County of Contra Costa (1995) 38 Cal.App.4th 890, 895.) We
affirm where any one of the several grounds for the motion is well
taken. (Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th 962,
967.)
b. Issue Preclusion
Courts “have frequently used ‘res judicata’ as an umbrella
term encompassing both claim preclusion and issue preclusion,
which [have been] described as two separate ‘aspects’ of an
overarching doctrine. [Citations.] Claim preclusion . . . acts to
bar claims that were, or should have been, advanced in a
previous suit involving the same parties. [Citation.] Issue
preclusion, . . . historically called collateral estoppel, describes
the bar on relitigating issues that were argued and decided in the
first suit.” (DKN Holdings LLC v. Faerber (2015) 61 Cal.4th 813,
823–824 (DKN Holdings).) We follow our Supreme Court in
referring “to ‘claim preclusion’ rather than ‘res judicata’
[citation], and use ‘issue preclusion’ in place of ‘direct or collateral
estoppel.’ ” (Samara v. Matar (2018) 5 Cal.5th 322, 326
(Samara); see also Grande v. Eisenhower Medical Center (2022)
13 Cal.5th 313, 323; DKN Holdings, at p. 824.)
Issue preclusion “prevents ‘relitigation of previously
decided issues,’ rather than causes of action as a whole.
[Citation.] It applies only ‘(1) after final adjudication (2) of an
identical issue (3) actually litigated and necessarily decided in
the first suit and (4) asserted against one who was a party in the
first suit or one in privity with that party.’ [Citation.]” (Samara,
supra, 5 Cal.5th at p. 327.) The “ ‘fact that different forms of
10
relief are sought in the two lawsuits is irrelevant.’ ” (Villacres v.
ABM Industries Inc. (2010) 189 Cal.App.4th 562, 576.) “ ‘ “When
an issue is properly raised, by the pleadings or otherwise, and is
submitted for determination, and is determined, the issue is
actually litigated,” ’ ” and “[w]hether an issue was ‘ “necessarily
decided . . . ” has been interpreted to mean that the issue was not
“ ‘entirely unnecessary’ ” to the judgment in the prior
proceeding.’ ” (Murphy v. Murphy (2008) 164 Cal.App.4th 376,
400.) The proceedings and their objectives do not have to be
similar for issue preclusion to apply. (Villacres, at p. 576.) Issue
preclusion “has the dual purpose of protecting litigants from the
burden of relitigating an identical issue with the same party or
his privy and of promoting judicial economy by preventing
needless litigation.” (Parklane Hosiery Co. v. Shore (1979) 439
U.S. 322, 326.)
c. PAGA Standing Principles
To provide context for our discussion below, we also explain
PAGA’s standing requirement. “ ‘The plain language of section
2699[, subdivision] (c) has only two requirements for PAGA
standing.’ ” (Nickson v. Shemran, Inc. (2023) 90 Cal.App.5th 121,
134.) “First, the plaintiff must be an ‘aggrieved employee,’ which
the statute defines as someone ‘ “who was employed by the
alleged violator.” ’ [Citation.] Second, plaintiff must be a person
‘ “against whom one or more of the alleged violations [of the
Labor Code] was committed.” ’ ” (Ibid.) Thus, to have standing to
maintain a PAGA cause of action, the employee plaintiff must be
able to allege he personally suffered a Labor Code violation
against the defendant employer.
11
II. Issue Preclusion Bars Rodriguez from Establishing
PAGA Standing
At issue on appeal is whether an arbitrator’s previous
adjudication of Labor Code violations in favor of Lawrence
precludes Rodriguez from asserting a PAGA cause of action based
on those same Labor Code violations.
a. We Adopt the Approach Taken in Rocha v. U-
Haul Co. of California
In Rocha v. U-Haul Co. of California (2023) 88 Cal.App.5th
65, 77 (Rocha), Division One of the Second District Court of
Appeal addressed this very issue. The Rocha court considered
whether an arbitrator’s finding that the employer did not violate
section 1102.5, rendered in the context of the employees’ personal
claims for damages, precluded those employees from alleging in a
subsequent complaint that they had standing under PAGA to
seek civil penalties based on the same purported violation.
(Rocha, at pp. 76–78.) Applying general principles of issue
preclusion, the appellate court held the employees could not rely
on the employer’s alleged section 1102.5 violation to establish
PAGA standing. (Rocha, at p. 79.)
The Rocha court explained that the issue of whether the
brothers are “aggrieved employees” based on the alleged section
1102.5 violation was “actually litigated in the arbitration, and
was necessary to resolution of the claims in arbitration.” (Rocha,
supra, 88 Cal.App.5th at p. 79.) The arbitrator’s finding was final
and binding on the employees, who were parties to the
arbitration. (Ibid.) The court concluded that “determining
whether a plaintiff suffered a Labor Code violation is no different
in the context of an individual Labor Code claim [for damages]
12
than it is in the context of determining an employee’s standing to
bring a PAGA claim. Therefore, in these two scenarios, the
plaintiff ‘ “is in fact litigating the same right.” ’ ” (Id. at p. 82.)
The court explained that this “approach is necessary in order to
avoid inconsistent adjudications as to whether a particular Labor
Code violation occurred.” (Id. at p. 78.)
The Rocha court expressly disagreed with Gavriiloglou v.
Prime Healthcare Management, Inc. (2022) 83 Cal.App.5th 595(Gavriiloglou), which Rodriguez cites in support of reversal. In
Gavriiloglou, Division Two of the Fourth District concluded the
arbitrator’s finding that plaintiff had not suffered a Labor Code
violation did not preclude that same plaintiff from qualifying as
an “aggrieved employee” under the PAGA based on the same
alleged Labor Code violations. (Id. at pp. 601–603.) Citing the
Restatement Second of Judgments, Code of Civil Procedure
section 1908, and several California cases about claim preclusion
(not issue preclusion), the Gavriiloglou court stated there was a
general rule that “ ‘a party appearing in successive actions . . . is
not precluded where the capacities in which he participated are
different.’ ” (Gavriiloglou, at p. 602, citing Holman v. County of
Santa Cruz (1949) 91 Cal.App.2d 502, 513; Meldrim v. Board of
Supervisors (1976) 57 Cal.App.3d 341, 346; Travis Glass Co. v.
Ibbetson (1921) 186 Cal. 724, 729–730; Code Civ. Proc., § 1908,
subd. (a)(2) [judgment is conclusive between the parties when
“ ‘litigating … in the same capacity’ ”].) The Gavriiloglou court
identified one exception to this rule: “ ‘ “[w]here a party though
appearing in two suits in different capacities is in fact litigating
the same right, the judgment in one estops him in the other.”
[Citations.]’ ” (Gavriiloglou, at p. 603.)
13
Applying this purported same capacity rule, the
Gavriiloglou court reasoned that “in the arbitration, Gavriiloglou
was litigating her own individual right to damages for Labor
Code violations, whereas in the present PAGA action, she is
litigating the state’s right to statutory penalties for Labor Code
violations. It follows that the arbitrator’s findings cannot have
preclusive effect.” (Gavriiloglou, supra, 83 Cal.App.5th at p.
603.) The Gavriiloglou court also stated the “same right”
exception did not apply because “ ‘[individual] employees do not
own a personal claim for PAGA civil penalties [citation], and
whatever personal claims [individual] employees might have for
relief are not at stake.’ ” (Ibid.)
Rocha found Gavriiloglou’s reasoning unpersuasive
because the supposed different capacity rule was not backed by
any citation to relevant law. The Rocha court explained that
none of the cases cited by Gavriiloglou in support of the same
capacity rule “applied a broad rule that issue preclusion requires
the precluded party to have been acting in the same capacity in
both proceedings at issue—indeed, none of them even involves
issue preclusion at all. Rather, these cases—and the cited Code
of Civil Procedure section—on which Gavriiloglou relies all
involve claim preclusion,” which prevents relitigation of the same
cause of action (not the same issue) in a second suit. (Rocha,
supra, 88 Cal.App.5th at p. 80.)
Rocha held that even if there was a same capacity rule in
the context of issue preclusion, the same right exception applied:
“The same right is at issue in (1) the arbitrator’s assessment of
whether [the employer]’s treatment of [employees] on a particular
occasion or occasions violated a particular Labor Code section
(made in the context of adjudicating an individual [Labor] Code
14
claim) and (2) the court’s assessment of whether that same
conduct constituted a violation of that same Labor Code section
(made in the context of a PAGA standing analysis). The two
assessments depend on exactly the same law and exactly the
same conduct. Regardless of the context in which this question is
asked, the employer either violated the employee’s rights or it did
not; this determination ‘derive[s] from readily ascertainable facts’
that are the same in both contexts. [Citation.] Thus, differences
in the capacity in which the [employees] are appearing in
connection with these two assessments—as individuals seeking
damages for harm suffered in one, and as proxies for the state
seeking statutory penalties in the other—have no effect on either
assessment, the conduct considered, or the applicable law.”
(Rocha, supra, 88 Cal.App.5th at pp. 81–82.)
We find persuasive Rocha’s analysis of issue preclusion and
thus decline to follow Gavriiloglou. We also note that Adolph,
supra, 14 Cal.5th 1104, supports our approach. In Adolph, the
Supreme Court stated, “If the arbitrator determines that [a
plaintiff] is not an aggrieved employee and the court confirms
that determination and reduces it to a final judgment, the court
would give effect to that finding, and [the plaintiff] could no
longer prosecute his non-individual claims due to lack of
standing.” (Id. at p. 1124.) The clear implication of Adolph’s
analysis is that arbitral findings have a preclusive effect on
standing in a stayed PAGA claim.
b. The Elements of Issue Preclusion Have Been
Satisfied
In light of Rocha and Adolph, we address whether the
elements of issue preclusion have been satisfied in the case at
bar.
15
Final Adjudication. “[I]ssue preclusion requires a final
adjudication of an issue.” (Parkford Owners for a Better
Community v. Windeshausen (2022) 81 Cal.App.5th 216, 227.)
For purposes of issue preclusion, a final adjudication includes
“ ‘any prior adjudication of an issue in another action that is
determined to be sufficiently firm to be accorded conclusive
effect.’ ” (Meridian Financial Services, Inc. v. Phan (2021) 67
Cal.App.5th 657, 688.) “ ‘[T]hat the parties were fully heard, that
the court supported its decision with a reasoned opinion, that the
decision was subject to appeal or was in fact reviewed on appeal,
are factors supporting the conclusion that the decision is final for
the purpose of preclusion.’ ” (Id. at pp. 688–689.) “ ‘ “ ‘Finality’ in
the context here relevant may mean little more than that the
litigation of a particular issue has reached such a stage that a
court sees no really good reason for permitting it to be litigated
again.” ’ ” (Id. at p. 689.)
Here, Rodriguez’s Labor Code wage-and-hour violations
were arbitrated and the trial court entered judgment confirming
the arbitration award. Rodriguez appealed the judgment, which
was affirmed by another panel of this court in an unpublished
opinion (Rodriguez v. Lawrence Equipment, Inc., supra,
B291180). Based on the foregoing, we conclude there was a final
adjudication of the wage and hour violations compelled to
arbitration.
Identical Issues. “ ‘ “The ‘identical issue’ requirement
addresses whether ‘identical factual allegations’ are at stake in
the two proceedings, not whether the ultimate issues or
dispositions are the same. [Citation.]” ’ ” (Textron Inc. v.
Travelers Casualty & Surety Co. (2020) 45 Cal.App.5th 733, 747.)
“An issue decided in a prior proceeding establishes [issue
16
preclusion] even if some factual matters or legal theories that
could have been presented with respect to that issue were not
presented.” (Bridgeford v. Pacific Health Corp. (2012) 202
Cal.App.4th 1034, 1042.)
Whether Rodriguez is an “aggrieved employee” for the
purposes of PAGA standing is based on Rodriguez’s ability to
allege Lawrence committed a Labor Code violation. As explained
in Rocha, to the extent a plaintiff’s PAGA standing is dependent
on the same Labor Code violations that he has adjudicated in
arbitration, the standing and the underlying violation are
considered identical issues.
Here, Rodriguez does not dispute that most of his alleged
Labor Code violations were adjudicated via arbitration. Rather,
he contends that his “non-PAGA Labor Code section 226 and
Labor Code section 201 claims [in the fifth and sixth causes of
action] do not address identical conduct or contain the same
elements as the PAGA Labor Code section[s] 226 and . . . 201
claims.” Specifically, Rodriguez argues the issues were not
identical because the fifth and sixth causes of action required him
to prove additional elements like scienter and injury, whereas the
PAGA cause of action merely required him to prove a violation of
the statute, e.g. failure to include the pay period on the wage
statement.
Nonetheless, that the non-PAGA claims have additional
elements does not alter our analysis. It is sufficient that a single,
dispositive element is identical and shared between different
claims. (See DKN Holdings, supra, 61 Cal.4th at p. 824 [issue
preclusion “prohibits the relitigation of issues argued and
decided . . . even if the second suit raises different causes of
action”], italics added.) Both PAGA and individual Labor Code
17
claims require a preliminary showing that a violation of the
Labor Code occurred to succeed. The arbitration award
conclusively established that there was no Labor Code violation.
Rodriguez also asserts that unlike the sixth cause of action
for violation of section 226, the PAGA cause of action additionally
sought to prove that the wage statements failed to contain
statutorily-required information. Yet, our review of the record
reveals otherwise. Both the fifth cause of action (non-PAGA) and
the eighth cause of action for the PAGA violation expressly
asserted that the wage statements did not contain the necessary
information, i.e. the employer’s legal address, inclusive dates for
the pay period, hourly rates, and number of hours worked at the
rates. Likewise, both the sixth cause of action (non-PAGA) and
the eighth cause of action for violation of PAGA alleged Lawrence
violated section 201 by not timely paying employees after each
employee’s termination or resignation. Based on the foregoing,
we conclude the issue of Rodriguez’s PAGA standing was
identical to the Labor Code violation causes of action ordered into
arbitration.
Actually Litigated and Necessarily Decided. “ ‘An
issue is actually litigated [for purposes of issue preclusion]
“[w]hen [it] is properly raised, by the pleadings or otherwise, and
is submitted for determination, and is determined . . . .” ’ ” (Ayala
v. Dawson (2017) 13 Cal.App.5th 1319, 1330.) “Courts have
understood the ‘ “necessarily decided” ’ prong to ‘require[ ] only
that the issue not have been “entirely unnecessary” to the
judgment in the initial proceeding.’ ” (Samara, supra, 5 Cal.5th
at p. 327.)
“[A]rbitrating parties are obliged . . . to place before their
arbitrator all matters within the scope of the arbitration, related
18
to the subject matter, and relevant to the issues . . . .”
(Thibodeau v. Crum (1992) 4 Cal.App.4th 749, 755 (Thibodeau)
citing Straus v. North Hollywood Hosp., Inc. (1957) 150
Cal.App.2d 306, 310 [presumption that, when parties submit
dispute to arbitration, they intend all matters in dispute to be
decided].) “A party cannot by negligence or design withhold
issues and litigate them in consecutive actions.” (Thibodeau, at
p. 755). “Case after case has held that an issue can be actually
litigated, notwithstanding one party’s failure to contest it.”
(People v. Bratton (2023) 95 Cal.App.5th 1100, 1120; Murray v.
Alaska Airlines, Inc. (2010) 50 Cal.4th 860, 869 [“ ‘[i]t is the
opportunity to litigate that is important . . . not whether the
litigant availed himself or herself of the opportunity.’ ”].) As
such, “ ‘ “[a] determination may be based on a failure of . . .
proof.” ’ ” (Bratton, at p. 1120; Murray, at p. 872.)
Here, Rodriguez was obliged to submit his section 226 and
201 allegations, as alleged in the fifth and sixth causes of action,
to the arbitrator. As mentioned in our discussion of identical
issues, the fifth and sixth causes of action echoed the PAGA
cause of action’s section 226 and 201 allegations. Furthermore,
Rodriguez’s arbitration briefing reflects that he actually argued
these Labor Code violations at arbitration. In his arbitration
brief, Rodriguez asserted that Lawrence violated section 226,
subdivision (a), by failing to provide accurate and complete wage
statements. His arbitration brief also contended that Lawrence
violated section 201 by failing to timely pay all earned and final
wages. In the arbitration award, the arbitrator acknowledged
that these issues were within the scope of the arbitration, stating
Rodriguez “alleged in his complaint that he had not been
provided with accurate wage statements, [and] had not been paid
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all earned and final wages and that respondent Lawrence
Equipment had engaged in unfair business practices.” These
issues were thus raised and submitted for the arbitrator’s
decision.
Rodriguez argues the issues were not litigated or decided
because the arbitrator never considered or made findings about
his allegations that Lawrence failed to furnish accurate and
complete wage statements in violation of section 226, subdivision
(a), or that Lawrence did not pay final wages in violation of
sections 226, subdivision (a), and 201. Yet, it “is presumed that
all issues submitted for decision [by the arbitrator] have been
passed on and resolved, and the burden of proving otherwise is
upon the party challenging the award.” (Rodrigues v. Keller
(1980) 113 Cal.App.3d 838, 842.) In finding that Rodriguez “shall
take nothing by way of his complaint,” the arbitrator necessarily
decided all of the wage and hour claims, including the sections
226, subdivision (a), and 201 claims. The arbitrator need not
make an express finding of fact regarding each wage-and-hour
claim because “arbitrators are not obliged to find facts or give
reasons for their award [citation].” (Rodrigues, at p. 843.) A
simple statement regarding the recovery amount the claimant
was entitled to from the opposing party was sufficient to resolve
all matters embraced by the arbitration. (Id. at pp. 842–843.)
We also note that Rodriguez presented no evidence at
arbitration to support his sections 226, subdivision (a), and 201
contentions. The arbitration award observed: “The evidence
presented at the arbitration hearing dealt solely with the issues
of alleged non-payment for all hours worked and the allegation of
legally non-compliant meal and rest breaks.” In other words,
Rodriguez chose not to present evidence on these claims at
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arbitration and now seeks to justify litigation of these claims
based on that choice. This is precisely the type of gamesmanship
that issue preclusion aims to prevent. (See Meridian Financial
Services, Inc. v. Phan (2021) 67 Cal.App.5th 657, 686–687 [The
public policies behind issue preclusion include: “ ‘conserving
judicial resources and promoting judicial economy by minimizing
repetitive litigation, preventing inconsistent judgments which
undermine the integrity of the judicial system, and avoiding the
harassment of parties through repeated litigation.’ ”].) (Italics
added.)
We therefore conclude all of Rodriguez’s wage and hour
violations, including those related to sections 226, subdivision (a),
and 201, were actually litigated and necessarily decided in the
arbitration proceedings.
Asserted Against the Same Party. “ ‘In accordance with
due process, [issue preclusion] can be asserted only against a
party to the first lawsuit, or one in privity with a party.’ ” (Cal
Sierra Development, Inc. v. George Reed, Inc. (2017) 14
Cal.App.5th 663, 672.) “The bar is asserted against a party who
had a full and fair opportunity to litigate the issue in the first
case but lost.” (DKN Holdings, supra, 61 Cal.4th at pp. 826–827.)
It is undisputed here that Rodriguez was a party to and fully
participated in the arbitration proceedings.
Conclusion. As all of the elements of issue preclusion are
satisfied, Rodriguez is precluded from relitigating the Labor Code
violations in an attempt to establish he is an aggrieved employee.
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Rodriguez thus lacks standing to pursue the PAGA cause of
action.10
DISPOSITION
We affirm the October 3, 2022 judgment of dismissal.
Defendant and respondent Lawrence Equipment, Inc. is awarded
its costs on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
BERSHON, J.*
We concur:
EDMON, P. J.
EGERTON, J.
10 We do not address Rodriguez’s argument that the trial
court erred by granting judgment on the pleadings based on the
U.S. Supreme Court’s decision in Viking River because we affirm
based on issue preclusion.
* Judge of the Los Angeles Superior Court, assigned by the
Chief Justice pursuant to article VI, section 6 of the California
Constitution.
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