section 17200 “borrows violations of other laws 1 and treats them as unlawful practices that the unfair competition 2 law makes independently actionable”
How later courts described this case
- section 17200 “borrows violations of other laws 1 and treats them as unlawful practices that the unfair competition 2 law makes independently actionable”
Written by the judges who cited it.
The opinion
1
2
3
4
5
6
7
8 UNITED STATES DISTRICT COURT
9 EASTERN DISTRICT OF CALIFORNIA
10 ----oo0oo----
11
12 JESSIE LOPEZ, on behalf of No. 2:23-cv-02734 WBS DB
himself and all others similarly
13 situated, and the general
public,
14 MEMORANDUM AND ORDER RE:
Plaintiff, DEFENDANT’S MOTION TO DISMISS
15
v.
16
WEST COAST ARBORISTS, INC., a
17 California corporation; and DOES
1 through 50, inclusive,
18
Defendants.
19
20
----oo0oo----
21
Plaintiff Jessie Lopez brought this putative labor
22
class action against his employer West Coast Arborists, Inc., a
23
tree and landscape maintenance company, in Sacramento Superior
24
Court. Defendant removed to federal court. Plaintiff alleges
25
multiple violations of the California Labor Code, including (1)
26
failure to provide meal periods, Cal. Lab. Code §§ 226.7, 512;
27
(2) failure to provide rest periods, id. § 226.7; (3) failure to
28
1 pay hourly wages and overtime, id. §§ 223, 510; (4) failure to
2 provide accurate written wage statements, id. § 226; (5) failure
3 to timely pay all final wages, id. §§ 201-03; (6) failure to
4 indemnify, id. § 2802; and (7) unfair competition, Cal. Bus. &
5 Prof. Code § 17200. (Compl. (Docket No. 1 at 13-35).)
6 Defendant moves to dismiss the action in its entirety.
7 (Docket No. 6.) A hearing on the motion was held on January 22,
8 2024. At that hearing, the court and the parties discussed the
9 submission of additional briefs. Upon further reflection, the
10 court concludes that it would not be assisted by any additional
11 briefing on the issues raised by the motion, nor does the court
12 choose to consider any issues not raised by the parties (Docket
13 Nos. 6, 10, 14-16). Because defense counsel emphasized at oral
14 argument that defendants are seeking neither to compel
15 arbitration nor to dismiss the action based on the collective
16 bargaining agreement’s waiver of a judicial forum, and explicitly
17 represented that the only issue to be decided on this motion is
18 LMRA preemption, the court will decide the motion solely on that
19 ground. The motion is accordingly taken under submission without
20 further need for oral argument.
21 I. Judicial Notice
22 Though a court generally may not consider material
23 outside the complaint on a motion to dismiss, the court may look
24 beyond the pleadings at “matters of which a court may take
25 judicial notice.” Tellabs, Inc. v. Makor Issues & Rights, Ltd.,
26 551 U.S. 308, 322 (2007). Under Federal Rule of Evidence 201, a
27 court may take judicial notice of an adjudicative fact that is
28 “not subject to reasonable dispute because it: (1) is generally
1 known within the trial court’s territorial jurisdiction; or (2)
2 can be accurately and readily determined from sources whose
3 accuracy cannot reasonably be questioned.” Fed. R. Evid. 201(b).
4 Defendant requests that the court take judicial notice
5 of the collective-bargaining agreement (“CBA”) applicable to
6 plaintiff. Along with its notice of removal, defendant provided
7 a declaration stating that plaintiff was subject to the CBA,
8 along with multiple documents specifically referencing
9 plaintiff’s union membership. (See Docket No. 1-2.) Plaintiff
10 argues that defendant has failed to make an initial showing that
11 the CBA applies to plaintiff. However, plaintiff does not
12 dispute the veracity of defendant’s declaration or supporting
13 documentation, does not allege that plaintiff was not subject to
14 the CBA, and does not dispute the accuracy of the copy of the CBA
15 provided by defendant.
16 “It is often necessary to consider the contents of a
17 CBA to decide a motion to dismiss based on an argument of
18 complete preemption, which is considered an ‘independent
19 corollary to the well-pleaded complaint rule.’” Patrick v. Nat’l
20 Football League, No. 23-cv-1069 DMG SHK, 2023 WL 6162672, at *3
21 (C.D. Cal. Sept. 21, 2023) (quoting Caterpillar Inc. v. Williams,
22 482 U.S. 386, 393 (1987)). See also Hall v. Live Nation
23 Worldwide, Inc., 146 F. Supp. 3d 1187, 1192–93 (C.D. Cal. 2015)
24 (quoting Parrino v. FFIP, Inc., 146 F.3d 699, 704 (9th Cir.
25 1998)) (taking judicial notice of CBA “‘because complete
26 preemption often applies to complaints drawn to evade federal
27 jurisdiction,’” and therefore “‘the court may look beyond the
28 face of the complaint to determine whether the claims alleged as
1 state law causes of action in fact are necessarily federal
2 claims’”) (alterations adopted).
3 The court therefore takes judicial notice of Exhibit 2
4 to defendant’s Request for Judicial Notice (Docket No. 6-2 at 29-
5 54) (“CBA”)) and Exhibits 3-5 concerning subsequent wage
6 increases under the CBA (Docket No. 6-2 at 55-65 (“Wage Increase
7 Documents”)).
8 The court also takes judicial notice of the State of
9 California Department of Industrial Relations information page
10 concerning the California minimum wage, located at
11 https://www.dir.ca.gov/dlse/faq_minimumwage.htm (“Minimum Wage
12 Webpage”). This document was retrieved from a State of
13 California official website and is therefore a matter of public
14 record not subject to reasonable dispute. See Khoja v. Orexigen
15 Therapeutics, Inc., 899 F.3d 988, 999 (9th Cir. 2018); Gerritsen
16 v. Warner Bros. Ent. Inc., 112 F. Supp. 3d 1011, 1033 (C.D. Cal.
17 2015).1
18 II. Discussion
19 Section 301 of the LMRA provides federal question
20 jurisdiction over “suits for violation of contracts between an
21 employer and a labor organization.” 29 U.S.C. § 185(a). “[T]he
22 Supreme Court has interpreted [section 301] to compel the
23 complete preemption of state law claims brought to enforce
24 collective bargaining agreements.” Valles v. Ivy Hill Corp., 410
25 F.3d 1071, 1075 (9th Cir. 2005) (citing Avco Corp. v. Aero Lodge
26
27 1 Notice of California minimum wage rates is necessary
for resolution of the motion. Defendant referenced the minimum
28 wage rates but did not formally request judicial notice of them.
1 No. 735, Int’l Ass’n of Machinists & Aerospace Workers, 390 U.S.
2 557, 560 (1968)).
3 Whether a claim is preempted by the LMRA is a two-step
4 inquiry. First, a court must determine whether the asserted
5 claim involves a right which “exists solely as a result of the
6 CBA” or “by virtue of state law.” Kobold v. Good Samaritan Reg’l
7 Med. Ctr., 832 F.3d 1024, 1032 (9th Cir. 2016) (internal
8 quotation marks omitted). If the right exists solely because of
9 the CBA, then the state law claim is preempted. Id. If the
10 right exists independently of the CBA, then the court must move
11 to the second step, “asking whether the right is nevertheless
12 substantially dependent on analysis of a [CBA].” Id. (internal
13 quotation marks omitted). If it is, then the state law claim is
14 preempted.
15 “[T]he conclusion that § 301 precludes adjudication of
16 a state law claim in whole or part does not automatically require
17 dismissal of a union-represented employee’s challenge of an
18 employer’s actions.” Kobold, 832 F.3d at 1036. However,
19 “[p]rior to bringing suit, an employee seeking to vindicate
20 personal rights under a collective bargaining agreement must
21 first attempt to exhaust any mandatory or exclusive grievance
22 procedures provided in the agreement.” Soremekun v. Thrifty
23 Payless, Inc., 509 F.3d 978, 985–86 (9th Cir. 2007). Therefore,
24 once a state law claim has been found preempted, “that claim must
25 either be [1] treated as a § 301 claim, or [2] dismissed” if the
26 employee failed to exhaust the CBA’s “mandatory grievance
27 procedure” and there is no applicable exception to the exhaustion
28 requirement. See Kobold, 832 F.3d at 1034, 1036, 1041.
1 The court will first address whether each claim is
2 preempted, then consider whether the exhaustion requirement is
3 satisfied. If a claim is preempted and has not been exhausted,
4 it will be dismissed unless plaintiff demonstrates that he is
5 excused from exhausting the CBA’s remedies. See id.
6 A. Third Claim2
7 Plaintiff’s third claim alleges that defendant failed
8 to pay overtime wages in violation of California Labor Code § 510
9 and minimum wages in violation of California Labor Code § 223.
10 Defendant argues that the overtime claim, but not the minimum
11 wage claim, is preempted. (See Reply (Docket No. 14) at 4
12 (“Defendant does not contend that the claim for unpaid minimum
13 wages is preempted by the LMRA.”).
14 Section 510 provides that the “requirements of this
15 section do not apply to the payment of overtime compensation to
16 an employee working pursuant to . . . [a]n alternative workweek
17 schedule adopted pursuant to a collective bargaining agreement
18 pursuant to Section 514.” Cal. Lab. Code § 510(a)(2). Section
19 514 states that “[s]ections 510 and 511 do not apply to an
20 employee covered by a valid collective bargaining agreement if
21 the agreement expressly provides for the wages, hours of work,
22 and working conditions of the employees, and if the agreement
23 provides premium wage rates for all overtime hours worked and a
24 regular hourly rate of pay for those employees of not less than
25 30 percent more than the state minimum wage.” Id. § 514. “By
26
27 2 The court begins with the third claim because it
involves discussion of the Curtis case, which provides a helpful
28 foundation for analysis of the other claims.
1 its terms, therefore . . . section 510 does not apply to an
2 employee who is subject to a qualifying CBA.” Curtis v. Irwin
3 Indus., Inc., 913 F.3d 1146, 1153-54 (9th Cir. 2019).
4 As explained by the Ninth Circuit in Curtis, if the
5 applicable CBA “meet[s] the requirements of section 514, [the
6 employee’s] right to overtime exists solely as a result of the
7 CBA, and therefore is preempted under § 301.” Id. at 1154
8 (internal quotation marks omitted). The CBA here plainly meets
9 these requirements, which plaintiff does not appear to dispute.
10 (See CBA Art. 12-16 (providing wage and hour policies,
11 descriptions of job duties and various working conditions,
12 overtime premiums for all employees, and a 2019 starting minimum
13 wage rate ranging from $17.10 to $25.10); Wage Increase Documents
14 (providing for annual wage increases of $0.80 or more); Minimum
15 Wage Webpage (stating that California’s minimum wage for
16 employers with 26 employees or more was $12 in 2019 and increased
17 to $15.50 by 2023).)
18 Accordingly, the court concludes that plaintiff’s third
19 claim, only insofar as it is brought under § 510, is completely
20 preempted by the LMRA. See Curtis, 913 F.3d at 1154. The court
21 does not address whether the third claim as brought under § 223
22 is preempted, as defendant does not argue that it is.
23 B. First Claim
24 Plaintiff’s first claim alleges that defendant failed
25 to provide meal periods in violation of California Labor Code §§
26 512 and 226.7.
27 Section 512’s protections do not extend to certain
28 employees, including those in construction occupations, who are
1 covered by a valid collective bargaining agreement that
2 “expressly provides for the wages, hours of work, and working
3 conditions of employees, and expressly provides for meal periods
4 for those employees, final and binding arbitration of disputes
5 concerning application of its meal period provisions, premium
6 wage rates for all overtime hours worked, and a regular hourly
7 rate of pay of not less than 30 percent more than the state
8 minimum wage rate.” See Cal. Lab. Code § 512(e)-(f).
9 Defendant states that plaintiff was engaged in a
10 construction occupation, which plaintiff does not appear to
11 dispute. See Cal. Bus. & Prof. Code § 7026.1(a)(4) (an
12 individual who “performs tree removal, tree pruning, stump
13 removal, or engages in tree or limb cabling or guying” qualifies
14 as a construction contractor). The CBA here plainly meets the
15 requirements to qualify for section 512’s exception, which
16 plaintiff also does not appear to dispute. (See CBA Art. 12-16
17 (providing wage and hour policies, descriptions of job duties and
18 various working conditions, overtime premiums for all employees,
19 meal periods for all employees, final and binding arbitration of
20 disputes concerning application of meal period provisions, and a
21 2019 starting minimum wage rate ranging from $17.10 to $25.10);
22 Wage Increase Documents (providing for annual wage increases of
23 $0.80 or more); Minimum Wage Webpage (stating that California’s
24 minimum wage for employers with 26 employees or more was $12 in
25 2019 and increased to $15.50 by 2023).) Plaintiff is therefore
26 exempt from section 512. See Cal. Lab. Code § 512(e)-(f).
27 As discussed above, the Ninth Circuit in Curtis held
28 that because section 514 excludes employees who are subject to a
1 qualifying CBA from the protections of section 510, claims under
2 section 510 are completely preempted when there is a qualifying
3 CBA. See 913 F.3d 1154. Curtis did not address whether claims
4 subject to section 512’s CBA exception are completely preempted.
5 However, “both sections 512 and 514 have nearly identical
6 exemptions that make the rights they confer negotiable.”
7 Radcliff v. San Diego Gas & Elec. Co., 519 F. Supp. 3d 743, 751–
8 52 (S.D. Cal. 2021). The court therefore “sees no reason why
9 Curtis should not be extended to preempt meal period claims made
10 by an employee who falls within the exemption set forth in
11 section 512(e).” See id.
12 In line with this conclusion, the Ninth Circuit has
13 extended Curtis’s logic to section 512’s CBA exemption in an
14 unpublished memorandum decision. See Marquez v. Toll Glob.
15 Forwarding, 804 F. App’x 679, 680 (9th Cir. 2020). Multiple
16 district courts have similarly applied Curtis to section 512.
17 See, e.g., Radcliff, 519 F. Supp. 3d at 751-52; Rodriguez v. USF
18 Reddaway Inc., No. 2:22-cv-00210 TLN DB, 2022 WL 18012518, at *4
19 (E.D. Cal. Dec. 30, 2022); Jimenez v. Young’s Mkt. Co., LLC, No.
20 21-cv-02410 EMC, 2021 WL 5999082, at *11 (N.D. Cal. Dec. 20,
21 2021); Schwanke v. Minim Prods., Inc., No. 2:21-cv-00111 SVW JPR,
22 2021 WL 4924772, at *2 (C.D. Cal. May 24, 2021); Blackwell v.
23 Com. Refrigeration Specialists, Inc., No. 2:20-cv-01968 KJM CKD,
24 2021 WL 2634501, at *5 (E.D. Cal. June 25, 2021); Parker v.
25 Cherne Contracting Corp., No. 18-CV-01912-HSG, 2019 WL 359989, at
26 *4 (N.D. Cal. Jan. 29, 2019). The court agrees with this line of
27 cases and therefore concludes that plaintiff’s first claim as
28 brought under section 512 is completely preempted by the LMRA.
1 Plaintiff also asserts his meal period claim under
2 section 226.7, which “shall not apply to an employee who is
3 exempt from meal or rest or recovery period requirements pursuant
4 to other state laws, including, but not limited to, a statute or
5 regulation, standard, or order of the Industrial Welfare
6 Commission.” See Cal. Lab. Code § 226.7(e). Because the
7 underlying statute providing for meal periods, section 512, does
8 not apply to plaintiff, section 226.7 likewise does not apply.
9 See id. Thus, for the same reasons provided in Curtis, and as
10 several district courts have similarly concluded, the claim as
11 brought under section 226.7 is completely preempted as well.
12 See, e.g., Plagakis v. Outsource Util. Contractor Corp., No.
13 1:23-cv-00798 CDB, 2023 WL 8602161, at *5 (E.D. Cal. Dec. 12,
14 2023) (“[e]xemptions under Labor Code § 512(e)(2) and § 226.7
15 operate in a similar manner to section 514 as discussed in
16 Curtis” in that “where the exclusions operate, any right an
17 employee . . . may have to the associated benefits would arise
18 under the CBA, and, thus, fail the first prong of the
19 [preemption] test”); Giles v. Canus Corp., No. 22-cv-03097-MMC,
20 2022 WL 3370793, at *5 (N.D. Cal. Aug. 16, 2022) (“where an
21 employee is exempt under section 512, such employee likewise is
22 exempt under section 226.7,” and their claim under section 226.7
23 is therefore preempted); Jones v. Sysco Ventura Inc., No. 2:21-
24 cv-04116 SVW AGR, 2021 WL 6104193, at *8 n.9 (C.D. Cal. Sept. 1,
25 2021) (§ 226.7 “does not apply to employees who are exempt from
26 meal period requirements under other state laws, which would
27 include the § 512(e) exemption,” and therefore plaintiff’s claim
28 under § 226.7 is preempted due to the applicability of the §
1 512(e) exemption); Jimenez, 2021 WL 5999082, at *11; Schwanke,
2 2021 WL 4924772, at *6.
3 The court therefore concludes that plaintiff’s first
4 claim for meal periods is completely preempted by the LMRA.
5 C. Second Claim
6 Plaintiff’s second claim alleges that defendant failed
7 to provide rest periods in violation of California Labor Code §
8 226.7, which provides that “[a]n employer shall not require an
9 employee to work during a meal or rest or recovery period
10 mandated pursuant to an applicable statute, or applicable
11 regulation, standard, or order of the Industrial Welfare
12 Commission . . . .” Cal. Lab. Code § 226.7(b) (emphasis added).
13 As stated above, this section “shall not apply to an employee who
14 is exempt from meal or rest or recovery period requirements
15 pursuant to other state laws, including . . . [an] order of the
16 Industrial Welfare Commission.” See id. § 226.7(e).
17 Defendant states that California Industrial Welfare
18 Commission Wage Order 16-2001, which covers construction
19 occupations, applies to plaintiff because he was engaged in a
20 construction occupation. Plaintiff does not appear to dispute
21 that he was in a construction occupation or that this Wage Order
22 applies.
23 The Wage Order provides, in relevant part, that “rest
24 periods shall be in employer designated areas and shall be ten
25 (10) minutes per every four (4) hours or a major fraction
26 thereof.” 8 Cal. Code Regs. § 11160.11(A). “If an employer
27 fails to provide an employee a rest period in accordance with the
28 applicable provisions of this Order, the employer shall pay the
1 employee one (1) hour of pay at the employee’s regular rate of
2 compensation for each work day that the rest period was not
3 provided.” Id. § 11160.11(D).
4 The rest provisions of the Wage Order “shall not apply
5 to any employee covered by a valid collective bargaining
6 agreement if the collective bargaining agreement provides
7 equivalent protection.” Id. § 11160(11)(E).
8 The CBA here provides equivalent protection to the Wage
9 Order. (See CBA Art. 12(D)(1) (providing rest periods of ten
10 minutes per every four hours); id. Art. 12(D)(4) (providing for
11 one hour’s worth of pay when an employer fails to provide a rest
12 period as required by the CBA).) Plaintiff is therefore exempt
13 from the applicable Wage Order. See 8 Cal. Code Regs. §
14 11160.11(E).
15 Because the underlying Wage Order providing for rest
16 periods does not apply to plaintiff, section 226.7 likewise does
17 not apply. See Cal. Lab. Code § 226.7(e). Thus, for the same
18 reasons provided in Curtis, and as several district courts have
19 similarly concluded, plaintiff’s second claim for rest periods
20 under section 226.7 is completely preempted by the LMRA due to
21 the applicability of the Wage Order’s CBA exemption. See, e.g.,
22 Rodriguez v. Gonsalves & Santucci, Inc., No. 21-cv-07874-LB, 2022
23 WL 161892, at *4 (N.D. Cal. Jan. 18, 2022) (“The wage provisions
24 in the CBA are nearly identical to those in [Wage Order 16].
25 Thus, the plaintiff’s right to rest periods is conveyed solely by
26 the CBA.”); Parker, 2019 WL 359989, at *4 (where CBA satisfied
27 the conditions of Wage Order 16, claim under section 226.7 based
28 on Wage Order was preempted); cf. Mendoza v. W. Water Features,
1 Inc., No. 2:23-cv-01923 KJM JDP, 2023 WL 8477962, at *4 (E.D.
2 Cal. Dec. 7, 2023) (because CBA did not provide equivalent
3 protections to Wage Order 16, the Wage Order applied to plaintiff
4 and therefore the claim under section 226.7 relying upon the Wage
5 Order was not preempted); Sykes v. F.D. Thomas, Inc., No. 20-cv-
6 03616-VC, 2021 WL 343960, at *2 (N.D. Cal. Feb. 2, 2021) (same).
7 The court therefore concludes that plaintiff’s second
8 claim for rest periods is completely preempted by the LMRA.
9 D. Sixth Claim
10 Plaintiff’s sixth claim alleges that defendant failed
11 to indemnify the expenses associated with employee uniforms, in
12 violation of California Labor Code § 2802.
13 The court first examines whether the claim involves a
14 right which “exists solely as a result of the CBA” or “by virtue
15 of state law.” See Kobold, 832 F.3d at 1032. For the first step
16 of the preemption inquiry, “a court must focus its inquiry on the
17 legal character of a claim . . . and not whether a grievance
18 [under the CBA] arising from precisely the same set of facts
19 could be pursued.” Id. at 1033 (quoting Caterpillar, 482 U.S. at
20 394) (emphasis in original). “Only if the claim is ‘founded
21 directly on rights created by a collective-bargaining agreement’
22 does § 301 preempt it.” Id. (quoting Livadas v. Bradshaw, 512
23 U.S. 107, 123 (1994)).
24 The sixth claim is based on plaintiff’s rights under
25 the California Labor Code. Specifically, the sixth claim alleges
26 that defendant failed to indemnify expenses in violation of
27 California Labor Code § 216. This claim clearly does not arise
28 directly from the CBA, but rather from the California Labor Code.
1 And “‘the mere existence of a CBA does not compel preemption of
2 plaintiff’s state law . . . claims.’” See McGinty v. Holt of
3 Cal., No. 2:22-cv-00865 WBS AC, 2022 WL 3226130, at *2 (E.D. Cal.
4 Aug. 10, 2022) (quoting Miller v. Bimbo Bakeries USA, Inc., No.
5 11-cv-00378 WHA, 2011 WL 1362171, at *3 (N.D. Cal. Apr. 11,
6 2011)) (alterations adopted). The court therefore turns to the
7 second step of the inquiry.
8 “[T]o determine whether a state [statutory claim] is
9 ‘substantially dependent’ on the terms of a CBA” under the second
10 step of the test, a court must “decide whether the claim can be
11 resolved by looking to versus interpreting the CBA.” Burnside v.
12 Kiewit Pac. Corp., 491 F.3d 1053, 1060 (9th Cir. 2007). A state
13 statutory claim that requires “interpreting” a CBA is said to be
14 “substantially dependent” on the CBA, and thus preempted by LMRA
15 section 301. Id. A state statutory claim that merely requires
16 “looking to” a CBA, on the other hand, is said not to be
17 “substantially dependent” on the CBA, and thus is not preempted
18 by the LMRA. Id. “At this second step of the analysis, claims
19 are only preempted to the extent there is an active dispute over
20 the meaning of contract terms.” Curtis, 913 F.3d at 1153
21 (internal quotation marks omitted).
22 Defendant does not detail what interpretation of --
23 rather than mere reference to -– the CBA would be required to
24 resolve the sixth claim. Rather, defendant merely points out
25 that the CBA has a provision requiring it to pay for employee
26 uniforms. There is no indication that there are any “questions
27 about the scope, meaning, or application of” any contract term.
28 See Livadas, 512 U.S. at 125.
1 The court therefore concludes that plaintiff’s sixth
2 claim is not preempted by the LMRA. See Corral-Bey v. Fluor
3 Flatiron Balfour Beatty Dragados DBJV, No. 2:22-cv-06903 MEM
4 FPVC, 2023 WL 6129480, at *5–8 (C.D. Cal. Sept. 18, 2023) (claim
5 under § 2802 not preempted where defendant did not show that the
6 claim required interpreting, rather than merely looking to, terms
7 of CBA).
8 E. Fourth, Fifth, & Seventh Claims
9 The fourth claim for inaccurate wage statements under
10 California Labor Code § 226 and the fifth claim for failure to
11 timely pay all final wages under California Labor Code §§ 201-203
12 are derivative of, inter alia, the third claim for failure to
13 provide minimum wages. (See Compl. ¶ 84.) Because the court
14 does not find that the third claim for minimum wages is
15 preempted, the derivative fourth and fifth claims are likewise
16 not preempted insofar as they are founded upon that violation.
17 See Plagakis, 2023 WL 8602161, at *7 (“where a court finds a
18 claim preempted by section 301 of the LMRA . . . derivative state
19 law claims likewise would be . . . preempted to the same extent
20 for the same reason”).
21 The seventh claim for unfair competition under
22 California Business & Professions Code § 17200 is derivative of,
23 inter alia, the third and sixth claims. (See Compl. ¶ 107.)
24 Because the third claim for minimum wages and sixth claim for
25 failure to indemnify are not preempted, the seventh claim is not
26 preempted insofar as it is founded upon those violations. See
27 Cel-Tech Commc’ns, Inc. v. Los Angeles Cellular Tel. Co., 20 Cal.
28 4th 163 (1999) (section 17200 “borrows violations of other laws
1 and treats them as unlawful practices that the unfair competition
2 law makes independently actionable”); Plagakis, 2023 WL 8602161,
3 at *7.
4 F. Exhaustion Requirement
5 As stated above, a claim preempted by section 301 of
6 the LMRA should be dismissed if brought by an employee who failed
7 to exhaust the applicable CBA’s mandatory grievance procedure,
8 unless the employee can show that they are excused from
9 exhausting the CBA’s remedies. See Kobold, 832 F.3d at 1034,
10 1036, 1041.
11 Here, the CBA provides for mandatory arbitration of all
12 claims under the CBA. (See CBA Art. 7(A)-(B) (“The grievance and
13 arbitration procedures set forth in this Agreement shall be the
14 exclusive means for the disposition of all grievances . . .
15 concerning the interpretation, application or violation of any
16 provision of this Agreement.”).)
17 Article 7 of the CBA requires that grievances
18 “concerning the interpretation, application or violation” of the
19 CBA be filed within fifteen days. (CBA Art. 7(B)-(C).)
20 Plaintiff argues that this limitation is unconscionable and
21 unenforceable because it “effectively shorten[s] the statute [of]
22 limitations from three years to 15 days,” and is therefore
23 unconscionable under California law. (Opp’n at 7.) However, “it
24 is firmly established that federal substantive law[, not
25 California law,] governs the validity and enforcement of
26 contracts under the LMRA,” including “arbitration provisions.”
27 See Dryer v. Los Angeles Rams, 40 Cal. 3d 406, 411 (1985)
28 (declining to undertake unconscionability analysis under
1 California law with respect to the “fairness of the arbitration
2 machinery”); see also Cramer v. Consol. Freightways Inc., 255
3 F.3d 683, 689 (9th Cir. 2001), as amended (Aug. 27, 2001)
4 (“federal common law preempts the use of state contract law in
5 CBA interpretation and enforcement”). Courts analyzing the
6 fairness of arbitration provisions in CBAs “may look to state law
7 for guidance, but only if it effectuates the policies underlying
8 federal labor legislation.” Dryer, 40 Cal. 3d at 411.
9 Even assuming arguendo that state law contract defenses
10 are applicable here, California law requires that both
11 “procedural” and “substantive” unconscionability be established
12 in order to find a contract provision unconscionable. See
13 Armendariz v. Found. Health Psychcare Servs., 24 Cal. 4th 83, 114
14 (2000). “A procedural unconscionability analysis begins with an
15 inquiry into whether the contract is one of adhesion.” Id. at
16 126. “A substantive unconscionability analysis examines the
17 fairness of a contract’s terms.” Id. at 129. Plaintiff’s
18 argument addresses the substantive fairness of the CBA. However,
19 plaintiff made no argument and provides no allegations concerning
20 the agreement’s procedural unfairness. To the contrary, the
21 Ninth Circuit has held that in the context of CBAs, “[w]hen the
22 parties have agreed upon a particular method of dispute
23 resolution, it should generally be presumed fair,” see Sheet
24 Metal Workers Int’l Ass’n, Loc. No. 162 v. Jason Mfg., Inc., 900
25 F.2d 1392, 1398 (9th Cir. 1990), because “parties to a collective
26 bargaining agreement are conclusively presumed to have equal
27 bargaining strength,” Waggoner v. Dallaire, 649 F.2d 1362, 1367
28 (9th Cir. 1981). Plaintiff’s failure to address procedural
ene ne I I NE IE OS OE IEE OSI ID eae
1 unconscionability alone warrants rejection of his argument that
2 the grievance procedures are unconscionable.
3 There are several established exceptions to the LMRA’s
4 exhaustion requirement. See Glover v. St. Louis-San Francisco
5 Ry. Co., 393 U.S. 324, 330 (1969). However, plaintiff has not
6 raised any of them here.
7 Because plaintiff has not pled that he exhausted the
8 CBA’s grievance procedures, the court will dismiss the first and
9 second claims in their entirety, and the third claim only insofar
10 as it seeks overtime wages under § 510, which are completely
11 preempted by the LMRA. The court will not dismiss plaintiff’s
12 other claims, which are not preempted.
13 IT IS THEREFORE ORDERED that defendant’s motion to
14 dismiss (Docket No. 6) be, and the same hereby is, GRANTED IN
15 PART as to plaintiff’s first claim for meal periods pursuant to
16 Cal. Lab. Code §§ 226.7, 512; second claim for rest periods
17 pursuant to Cal. Lab. Code § 226.7; and third claim only insofar
18 as it seeks overtime wages pursuant to Cal. Lab. Code § 510,
19 which are hereby DISMISSED. The motion is DENIED in all other
20 respects.
21 Plaintiff is given twenty days from the date of this
22 Order to file an amended complaint if he can do so consistent
23 | with this Order. Jed ie 2
24 | Dated: February 1, 2024 eh a Vi (hn
55 UNITED STATES DISTRICT JUDGE
26
27
28
18