Khan v. Dunn-Edwards Corp.

Filed 1/4/18; Certified for Publication 1/22/18 (order attached)
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION EIGHT
HAMID H. KHAN, B270382
Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. BC477318)
v.
DUNN-EDWARDS
CORPORATION,
Defendant and
Respondent.
APPEAL from a judgment of the Superior Court of Los
Angeles County, Richard L. Fruin, Judge. Affirmed.
Diversity Law Group, Larry W. Lee; Law Offices of Choi &
Associates and Edward W. Choi for Plaintiff and Appellant.
Reed Smith, Michele J. Beilke, Raymond A. Cardozo,
Julia Y. Trankiem and Brian A. Sutherland for Defendant and
Respondent.
******
1
This lawsuit is brought pursuant to Labor Code section
2698, the Labor Code Private Attorneys General Act of 2004
(PAGA). We affirm the summary judgment because plaintiff
Hamid H. Khan failed to provide adequate notice of his claim to
the relevant agency prior to bringing the lawsuit against his
former employer Dunn-Edwards Corporation (Dunn-Edwards).
BACKGROUND
Khan worked at Dunn-Edwards from September 6, 1994, to
September 2, 2011. During normal pay periods, all of Khan’s
wage statements included the pay period start date. Khan never
looked at his wage statements. His payments were deposited
directly into his bank account. Khan received his final paycheck
on September 13, 2011. In contrast to all other wage statements,
Khan’s final wage statement did not include the start date for the
pay period.
1. Initial Complaint
In January 2012, Khan sued Dunn-Edwards for receiving
his pay check 11 days after his termination, allegedly in violation
of Labor Code sections 201 through 203. He purported to sue on
behalf of himself and others similarly situated and alleged that
he could establish the prerequisites for a class action lawsuit.
2. Khan’s PAGA Notice
On February 28, 2012, after the lawsuit was pending, Khan
provided Dunn-Edwards’s counsel and the California Labor and
Workforce Development Agency with the following notice:
“This correspondence shall constitute written notice under
Labor Code § 2699.3 of my claims against my former employer,
Dunn-Edwards Corporation (‘Dunn Edwards’ or ‘Defendant’).
Specifically, I allege that Dunn Edwards:
2
“1. Violated Labor Code § 226(a) by failing to identify all of
the required information on my final paycheck stub/itemized
wage statement that I received, including but not limited to the
pay period begin date, the correct pay date, and the total hours
worked.
“2. Violated Labor Code §§ 201-203 by failing to pay all of
my earned wages immediately upon termination and failure to
pay waiting time penalties as a result thereof.” (Italics added.)
Khan admitted that his notice “makes no mention of any
other Labor Code violations and does not reference any other
current or former employee besides Khan.” (Italics added.)
3. First Amended Complaint
After receiving notice that the Labor and Workforce
Development Agency did not intend to investigate the allegations
in his notice, Khan filed his first amended complaint (FAC) on
April 19, 2012. The FAC included a cause of action under PAGA.
Khan voluntarily dismissed his individual claim described above
after the court concluded that he was compelled to arbitrate it.
In the remaining PAGA cause of action, Khan alleged:
“upon the last date of his employment, DEFENDANTS did not
pay Plaintiff all wages owed immediately on his last date of
employment, or within 72 hours thereof. Rather, as a matter of
corporate policy, practice and procedure, DEFENDANTS paid
Plaintiff his final wages by mail almost 11 days after his
termination. Further, said final wages failed to include all of
Plaintiff’s earned wages. Additionally, the itemized wage
statement provided along with said final wages failed to include
various information as required pursuant to Labor Code § 226(a),
including, but not limited to, the pay period begin date, the
correct pay date, and the total hours worked. Plaintiff alleges
3
that such practice in the payment of final wages by
DEFENDANTS were [sic] done on a company-wide basis that
applied in the same exact manner to all of its former employees
in California as a matter of corporate policy, practice and
procedure.” Based on these allegations, Khan sought civil
penalties.
4. Summary Judgment
The trial court granted Dunn-Edwards’s motion for
summary judgment. Among other reasons, the trial court
concluded that Khan’s notice was insufficient. This appeal
followed.
DISCUSSION
“Summary judgment is appropriate where ‘the action has
no merit or . . . there is no defense to the action or proceeding.’
([Code Civ. Proc.,] § 437c, subd. (a)(1).) A party seeking summary
judgment bears the initial burden of making a prima facie
showing that no triable issue of material fact exists. [Citation.]
If this burden is met, the party opposing the motion bears the
burden of showing the existence of disputed facts. [Citation.] We
independently review the granting of summary judgment to
ascertain whether there is a triable issue of material fact
justifying reinstatement of the action. [Citation.] The trial
court’s ruling to grant a summary judgment should be upheld
only if no triable issue as to any material fact exists, and the
moving party is entitled to judgment as a matter of law.”
(Deutsche Bank National Trust Co. v. Pyle (2017) 13 Cal.App.5th
513, 520.)
1. Legal Principles
“PAGA was enacted in 2003 to improve enforcement of
Labor Code violations. [Citation.] The legislation was a response
4
to two related problems: (1) many Labor Code provisions were
unenforced because they authorized only criminal sanctions and
district attorneys tended to target other priorities, and (2)
understaffed state enforcement agencies often lacked sufficient
resources to pursue available civil sanctions. [Citations.] Citing
the importance of adequate financing of labor law enforcement,
declining staffing levels for labor law enforcement agencies, and a
growing labor market, the Legislature declared it was ‘in the
public interest to allow aggrieved employees, acting as private
attorneys general, to recover civil penalties for Labor Code
violations, with the understanding that labor law enforcement
agencies were to retain primacy over private enforcement
efforts.’ ” (Lopez v. Friant & Associates, LLC (2017) 15
Cal.App.5th 773, 777-778.)
“Under PAGA, an ‘aggrieved employee’ may file a
representative action ‘on behalf of himself or herself and other
current and former employees’ to recover civil penalties for
violations of the Labor Code that otherwise would be assessed
and collected by the Labor and Workforce Development
Agency . . . . [Citations.] For all provisions of the Labor Code for
which a civil penalty is not specified, PAGA creates a default civil
penalty. [Citation.] The civil penalties available under PAGA
are in addition to any other remedies available under state or
federal law. [Citation.] Any civil penalty recovered is paid 75
percent to the [Labor and Workforce Development Agency] and
25 percent to aggrieved employees.” (Lopez v. Friant &
Associates, LLC, supra, 15 Cal.App.5th at p. 778.)
“Before bringing a PAGA claim, a plaintiff must comply
with administrative procedures outlined in section 2699.3,
requiring notice to the [Labor and Workforce Development
5
Agency] and allowing the employer an opportunity to cure
unspecified violations not listed in section 2699.5. (§§ 2699,
subds. (a), (c), (g)(1), 2699.3.)” (Lopez v. Friant & Associates,
supra, 15 Cal.App.5th at p. 785.) Our Supreme Court has
explained that: “[a]s a condition of suit, an aggrieved employee
acting on behalf of the state and other current or former
employees must provide notice to the employer and the
responsible state agency ‘of the specific provisions of [the Labor
Code] alleged to have been violated, including the facts and
theories to support the alleged violation.’ ” (Williams v. Superior
Court (2017) 3 Cal.5th 531, 545.)
“The evident purpose of the notice requirement is to afford
the relevant state agency, the Labor and Workforce Development
Agency, the opportunity to decide whether to allocate scarce
resources to an investigation, a decision better made with
knowledge of the allegations an aggrieved employee is making
and any basis for those allegations. Notice to the employer serves
the purpose of allowing the employer to submit a response to the
agency (see Lab. Code, § 2699.3, subd. (a)(1)(B)), again thereby
promoting an informed agency decision as to whether to allocate
resources toward an investigation.” (Williams v. Superior Court,
supra, 3 Cal.5th at pp. 545-546.)
2. Khan Failed to Comply with Required Administrative
Procedures
The trial court concluded that “[c]ompliance with the pre-
filing notice and exhaustion requirements are mandatory.” The
trial court further concluded that Khan failed to comply. At the
hearing the court stated “unless the group is identified” the
notice does not specify the aggrieved employees.
6
On appeal, Khan challenges the trial court’s conclusion,
arguing that his notice was sufficient even though he limited it to
his claims. Khan argues that his notice did not “need to specify
that it is being sought for aggrieved employees because plaintiff
is a proxy of the state.” (Capitalization and boldface omitted.)
He argues that his notice should be “assumed to being brought on
a representative capacity.”
Khan’s argument lacks merit. Because his notice expressly
applied only to him, it failed to give the Labor and Workforce
Development Agency an adequate opportunity to decide whether
to allocate resources to investigate Khan’s representative action.
Because Khan referred only to himself, the agency may have
determined that no investigation was warranted. Additionally,
the notice failed to provide Dunn-Edwards with an adequate
opportunity to respond to the agency since the notice suggested
only an individual violation.
Khan’s reliance on the unpublished federal district court
cases York v. Starbucks Corp. (C.D.Cal., Nov. 1, 2012, CV-08-
07919 GAF (PJWx)) 2012 WL 10890355 and Gonzalez v. Millard
Mall Services, Inc. (S.D.Cal., Aug. 21, 2012, 09cv2076-
AJB(WVG)) 2012 WL 3629056 is misplaced. In York, the notice
sent to the Labor and Workforce Development Agency referred to
“employees” and employees’ “wage statements.” (York, at p. *4.)
In Gonzalez, the notice specifically identified two aggrieved
employees and also advised the agency that counsel represented
them “ ‘in a potential class action.’ ” (Gonzalez, at p. *3.) Thus in
both cases, the notice sufficiently suggested claims on behalf of
multiple employees. The notices did not, as did Khan’s notice,
affirmatively suggest only an individual claim.
7
Khan cites to Williams v. Superior Court, supra, 3 Cal.5th
531. Williams, however, is inapposite: in relevant part, it
addressed whether the plaintiff had to provide preliminary proof
of alleged PAGA violations before he could engage in broad
discovery related to those allegations, not the sufficiency of his
original PAGA notice. (Id. at pp. 544-549.)
Because Khan failed to give fair notice of the individuals
involved, he failed to comply with the administrative
requirement, and the trial court properly granted summary
judgment.1
DISPOSITION
The judgment is affirmed. Respondent is entitled to costs
on appeal.
SORTINO, J.*
WE CONCUR:
RUBIN, Acting P. J. GRIMES, J.
1 In his reply brief, Khan argues he should be able to pursue
claims on his own behalf. The argument is not persuasive. First,
he dismissed his individual claims. More significantly, as he
concedes, a PAGA action is only a representative action.
“Permitting pursuit of only individual penalties appears
inconsistent with PAGA’s objectives.” (Tanguilig v.
Bloomingdale’s, Inc. (2016) 5 Cal.App.5th 665, 676.)
* Judge of the Los Angeles Superior Court, assigned by the
Chief Justice pursuant to article VI, section 6 of the California
Constitution.
8
Filed 1/22/18
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION EIGHT
HAMID H. KHAN, B270382
Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. BC477318)
v.
ORDER CERTIFYING
DUNN-EDWARDS OPINION FOR
CORPORATION, PUBLICATION
Defendant and NO CHANGE IN
Respondent. JUDGMENT
THE COURT:*
The opinion in the above-entitled matter filed on
January 4, 2018, was not certified for publication in the Official
Reports. For good cause, it now appears that the opinion should
be published in the Official Reports and it is so ordered.
* RUBIN, Acting P. J. GRIMES, J. SORTINO, J.**
** Judge of the Los Angeles Superior Court, assigned by the
Chief Justice pursuant to article VI, section 6 of the California
Constitution.
1