In Kizer v. Tristar Risk Management, ___ Cal.App.5th ___ (Jun. 26, 2017; pub. ord. Jul. 26, 2017), the Court of Appeal (Fourth Appellate District, Division Three) affirmed an order denying class certification of Labor Code claims arising out of the defendant's alleged misclassification of its claims examiners, and of the UCL "unlawful" prong claim stemming from that.
Basically, the Court of Appeal reasoned that misclassification, standing alone, is not unlawful; instead, a violation occurs only when the misclassified employees are denied overtime pay (or other statutory protections afforded to non-exempt employees). Slip op. at 12-20. Even if the elements relevant to assessing the applicability of the administrative exemption might be amenable to common proof, this was not sufficient for class certification, because the plaintiffs had failed to offer any proof of a uniform policy policy or practice to deny overtime pay to the claims examiners. See id.
For similar reasons, the Court of Appeal affirmed the ruling as to the UCL claim. Id. at 20-23. The plaintiffs relied on Tobacco II, arguing that individualized proof of causation and injury are not elements of a UCL claim. Id. at 21-22. But the Court of Appeal found a more basic problem in the plaintiffs' failure to introduce any common proof of an unlawful practice (i.e., denying overtime pay to claims examiners):
As explained above, and contrary to Plaintiffs’ contention, the trial court did not deny Plaintiffs’ class certification motion based on their failure to present individualized proof of injury by each potential class member. Rather, the court denied the motion because Plaintiffs failed to satisfy the commonality requirement by presenting evidence to show they could establish through common proof that Tristar required claims examiners to work overtime. Substantial evidence supports that finding and it is consistent with the governing legal standards.
Id. at 23.
The Kizer opinion is one for the list of post-Tobacco II class certification decisions. (See my prior series of posts: "Nine post-Tobacco II decisions," "A tenth post-Tobacco II opinion," "New UCL class certification decision," and "A thirteenth post-Tobacco II opinion.")
Although the opinion cites Cohen v. DIRECTV, Inc., 178 Cal.App.4th 966 (2009) and Davis‑Miller v. Automobile Club of Southern California, 201 Cal.App.4th 106 (2011) (discussed in these blog posts), I would still put in on the plaintiffs' side of the ledger. Unlike those cases, Kizer did not hold that certification could be properly denied due to predominance of non-common questions as to reliance or injury (which are not even elements of a UCL claim). Rather, Kizer focused on whether the unlawful conduct itself could be established through common proof. In so holding, Kizer also relied heavily on Steroid Hormone Product Cases, 181 Cal.App.4th 145 (2010) (discussed in this blog post), which illustrates the proper focus of the class certification inquiry in a UCL "unlawful" prong case.
Comments