Sunday, May 18, 2014

Fourth District Concludes Decertification of Suitable Seating Class Was Error, As Trial Court Was Not Permitted To Rule On The Viability of the Plaintiff’s Legal Theory Under the Wage Order: Hall v. Rite Aid Corp.

On May 16, 2014, 2014, the Fourth District (Division 1) ordered publication of its opinion in Hall v. Rite Aid Corp., __ Cal. App. 4th __ (2014) [2014 Cal. App. LEXIS 426], which concluded the trial court erred by decertifying the plaintiff’s suitable seating claim “based on an assessment of the merits of [the plaintiff’s] theory rather than on whether the theory was amenable to class treatment.”  See Slip Opinion, at 2-3.  At issue was whether the trial court acted properly by rendering a legal ruling on the plaintiff’s theory of liability – which involved a disputed interpretation of section 14 of the Wage Order – within the confines of a motion for certification.

Specifically, the plaintiff’s theory of liability – which had previously been certified by the trial court – “was that the work performed by Cashier/Clerks when stationed at the check-out registers reasonably permits the use of seats and therefore the failure to provide seats violated section 14 ….” See Slip Opinion, at 4.  Rite Aid sought decertification by proffering a completely different interpretation of the Wage Order, which it claimed rendered the liability question individualized.  Id., at 6-7 (asserting (1) that “under section 14 [of the Wage Order], the ‘nature of the work’ inquiry requires examination of the job ‘as a whole,’ rather than whether some discrete subpart of the employee's duties was amenable to being performed while seated” [cite], and (2) that “the variations among class members as to their job as a whole, including the amount of time they spend at the check-out counter compared with other duties, … made class treatment improper because … [it] required individualized inquiries for each class member….”).  Yet, despite the plaintiff’s assertion that such grounds were immaterial to the theory of liability she put forward [id., at 7-8], the trial court adopted Rite Aid’s interpretation of the Wage Order and decertified the class.  Id., at 8.

Importantly, the Court of Appeal held that this was error because, by basing decertification on a substantive interpretation of the Wage Order, the trial court’s order impermissibly rested upon the “merits” of the plaintiff’s proffered theory rather than on whether the theory itself would be amenable to common proof:
It does not appear that any aspect central to Hall's theory of recovery (i.e. what is Rite Aid's policy, and whether the nature of the work involved in performing check-out functions would reasonably permit the use of seats) would not be amenable to common proof. Indeed, the trial court's decertification order did not make a contrary determination (i.e., those inquiries would not be amenable to common proof), but was instead based on its conclusion that Hall's theory of liability was unmeritorious. Specifically, it concluded, contrary to Hall's postulated theory, that section 14 does not mandate the provision of suitable seats when the nature of a substantial task within an employee's range of duties would reasonably permit the use of seats, but instead mandates the provision of suitable seats only when the nature of an employee's work as a whole would reasonably permit the use of seats. Based on that construction of section 14, the trial court concluded decertification was proper because individual issues as to each class member's "job as a whole" would predominate over common questions. However, under Brinker as construed by Bradley, Benton and Faulkinbury, the trial court's decertification order was based on improper criteria and/or erroneous legal assumptions and must be reversed because it based its ruling on the merits of Hall's theory rather than on whether the theory itself would be amenable to common evidentiary proof.
See Slip Opinion, at 19.

Significantly, the Court rejected Rite Aid's contention that it is appropriate to resolve statutory interpretation issues at the certification stage to prevent a plaintiff from “inventing a class action by proposing an incorrect rule of law”, asserting this process conflicts with Brinker.  Id., 20 (“We read Brinker to hold that, at the class certification stage, as long as the plaintiff's posited theory of liability is amenable to resolution on a class-wide basis, the court should certify the action for class treatment even if the plaintiff's theory is ultimately incorrect at its substantive level, because such an approach relieves the defendant of the jeopardy of serial class actions …”).  As explained by the Court, Brinker makes clear that the ultimate legal question posed by a theory of liability cannot be resolved in the context of certification, as the propriety of certification does not depend on the court determining such legal matters:
Rite Aid, seizing on Brinker's observation that "[t]o the extent the propriety of certification depends upon disputed threshold legal or factual questions, a court may, and indeed must, resolve them" (Brinker, supra, 53 Cal.4th at p. 1025, italics added), argues the court properly evaluated the merits of Hall's legal theory as a predicate to ruling on the decertification motion. However, Brinker repeatedly cautioned that "[s]uch inquiries are closely circumscribed" (id. at p. 1024) and ordinarily should not be addressed as part of the certification evaluation. (Id. at p. 1023 ["resolution of disputes over the merits of a case generally must be postponed until after class certification has been decided [citation] with the court assuming for purposes of the certification motion that any claims have merit"].) We interpret the highlighted language in the passage from Brinker cited by Rite Aid to mean, by negative implication, that to the extent the propriety of certification does not depend on determining threshold legal matters, such determinations should be deferred.n7 Here, the propriety of certification does not depend on whether Hall's interpretation of section 14 is correct because, "assuming for purposes of the certification motion [Hall's] claims have merit," the certification question must focus on whether common questions relevant to proving Hall's theory would predominate over individual issues. Certainly, whether Rite Aid had a policy requiring Cashier/Clerks to stand while working at the register is subject to common proof. Moreover, the other factual question central to Hall's theory of recovery--whether the nature of the work involved in performing check-out functions would reasonably permit the use of seats--appears equally amenable to common proof. Thus, regardless of whether Hall's or Rite Aid's interpretation of section 14's mandate is correct, class certification for Hall's claim would be proper,n8 and resolution of disputes over the merits of Hall's theory of recovery must be deferred until after the class certification has been decided.
See Slip Opinion, at 21-22.

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