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Alison Rose, On Behalf of Herself and All Others Similarly Situated v. Wildflower Bread Company

January 20, 2011

ALISON ROSE, ON BEHALF OF HERSELF AND ALL OTHERS SIMILARLY SITUATED, PLAINTIFF,
v.
WILDFLOWER BREAD COMPANY, DEFENDANT.



ORDER

The Court granted Defendant's Partial Motion for Judgment on the Pleadings (Doc. #33) as to Count II only on May 4, 2010 (Doc. 85). Plaintiff has moved the Court to reconsider that ruling based on the Ninth Circuit Court of Appeals decision in Wang v. Chinese Daily News, Inc., 623 F.3d 734 (9th Cir. 2010), which was decided after the Court's May 4, 2010 Order. (Doc. 109.) After reviewing the Motion for Reconsideration, the Response thereto, and the Reply in support, the Court will grant the Motion for Reconsideration and order the Plaintiff to re-file a motion for class certification pursuant to Federal Rule of Civil Procedure 23.

I. BACKGROUND

Defendant Wildflower Bread Company operates multiple restaurants in Arizona. Plaintiff Alison Rose worked for Defendant as an Assistant Manager. Defendant classifies all its Assistant Managers as exempt from the overtime pay provisions of the Fair Labor 1 Standards Act (the "FLSA").*fn1 Defendant therefore does not pay its Assistant Managers time 2 and a half for any hours worked over forty in a work week.

3 Plaintiff brings this case on her own behalf and on behalf of all those similarly 4 situated. She claims that she and the other Wildflower Assistant Managers regularly 5 perform(ed) non-exempt physical or manual work. Plaintiff argues that Assistant Managers 6 do not fall under the "executive exemption" to the FLSA set out in 29 C.F.R. §541.100 7 because the duties of Assistant Managers consist mainly of manual work. Plaintiff therefore 8 seeks the remedies provided in 29 U.S.C. §216(b) for a violation of the overtime provision 9 of 29 U.S.C. §207(a).

Plaintiff further claims that Defendant's failure to pay overtime to its Assistant Managers, as required by the FLSA, violates the Arizona Wage Act. The Arizona Wage Act does not contain a provision requiring payment of overtime for hours in excess of forty, but the Act does require that employees receive their "wages" in a timely fashion. A.R.S. §§23-351 et seq. If Defendant owed Plaintiff overtime wages under the FLSA, then she did not receive those "wages" in the time required by the Arizona Wage Act. The Arizona Wage Act provides for treble damages, A.R.S. §23-355, while the FLSA allows double damages, 29 U.S.C. §216(b).

Plaintiff sought collective action treatment of her FLSA claims pursuant to 29 U.S.C. §216. (Doc. #34.) She also moved for class certification under Federal Rule of Civil Procedure 23 for her state law Arizona Wage Act claim. (Id.) In its May 4, 2010 Order, the Court conditionally certified a representative collective action pursuant to the FLSA "on behalf of all current and former Wildflower Assistant Mangers employed at anytime on or after three years prior to the filing of the Complaint." (Doc. 85, p.21.) In that same Order, 1 the Court denied Plaintiff's Rule 23 Motion for Class Action Certification as moot because 2 the Court granted judgment on the pleadings to Defendant on Plaintiff's only state law claim. 3 (Id., p.17.) 4 The Court granted judgment on the pleadings to Defendant on Plaintiff's Arizona 5 Wage Act claim because the Court found, based on obstacle preemption, that the FLSA 6 preempted the state law claim. The Court held that the FLSA preempts a state law claim if 7 the state law claim "wholly depends upon a violation of the FLSA . . .." (Id., pp.12-13.) 8 The Court determined that permitting Plaintiff to file a claim under that Arizona Wage 9 Act that depends completely on the FLSA for its viability would allow her to circumvent the comprehensive remedial scheme set out in the FLSA. (Id., p.13.) Ultimately, the Court found that allowing Plaintiff to proceed on her dependent state law claim would frustrate the "accomplishment and execution of the full purposes and objectives of Congress" in enacting the FLSA's comprehensive remedial scheme and the Portal-to-Portal amendments' opt-in provisions.*fn2 (Id., pp.13-15.) In reaching its decision, the Court relied on dicta in Williamson v. Gen. Dynamics, 208 F.3d 1144, 1154 (9th Cir. 2000)("Fraud claims by employees do not conflict with the FLSA any more than claims for wrongful death, assault, or murder. Claims that are directly covered by the FLSA (such as overtime and retaliation disputes) must be brought under the FLSA.") and the reasoning of Anderson v. Sara Lee, 508 F.3d 181 (4th Cir. 2007).

II. ANALYSIS AND CONCLUSION

Plaintiff moves pursuant to Local Rule of Civil Procedure 7.2 for reconsideration of 3 the Court's Order finding that the FLSA preempts her Arizona Wage Act claim. The Court 4 ordinarily will deny a motion for reconsideration absent a showing of manifest error or a 5 showing of new facts or legal authority that could not have been brought to the Court's 6 attention earlier with reasonable diligence. L.R.Civ.P. 7.2(g). 7 Plaintiff bases her Motion for Reconsideration on Wang. The Court entered its Order 8 on May 4, 2010. The Ninth Circuit Court of Appeals filed the decision in Wang on 9 September 27, 2010. Plaintiff filed her Motion for Reconsideration on October 7, 2010. Plaintiff therefore did not delay in bringing the Wang decision to the Court's attention.

The plaintiffs in Wang worked for a Chinese-language newspaper. 623 F.3d at 748. They alleged that their employer made employees work more than eight hours a day and forty hours a week, denied employees overtime compensation, and denied employees meal and rest breaks, accurate and itemized wage statements, and penalties for wages due, but not promptly paid, at termination. Id. at 749. The plaintiffs brought suit under the FLSA, California's Labor Code, and California's Unfair Competition Law, Cal Bus. & Prof.Code §17200. Id.

The California district court certified the plaintiffs' FLSA claims as a collective action and certified the state-law claims as a class action under Federal Rule of Civil Procedure 23(b)(2) and, alternatively, subsection (b)(3). Id. The district court granted summary judgment to the employees on the FLSA's creative professionals exemption issue, finding the employees were non-exempt. Id. at 750. The district court held a 16-day jury trial, which resulted in a special verdict for plaintiffs, and conducted a bench trial on the remaining issues of injunctive relief, penalties, prejudgment interest, and restitution. Id.

On appeal, employer argued, among other things, that the district court erred: (1) in finding that a cause of action alleging violations of FLSA under California Business and 1 Professions Code §17200 is not preempted by FLSA*fn3 and (2) in choosing to exercise 2 supplemental jurisdiction over the state-law claims. Id. at 759. Section 17200 "borrows" 3 violations of other laws and treats those violations, when committed pursuant to business 4 activity, as unlawful practices independently actionable under section 17200. Id. at 758 5 (internal citations omitted). The Wang plaintiffs' §17200 claim "borrowed" FLSA as the 6 substantive violation. Id. at 759. The state-law claim therefore wholly depended on the FLSA.

8 The Ninth Circuit began its preemption analysis by stating that it had never expressly 9 held that the FLSA preempts a state-law claim. Id. In discussing Williamson, the Ninth Circuit acknowledged that the Williamson opinion did contain "somewhat contradictory statements," including dicta that "claims that are directly covered by the FLSA (such as overtime and retaliation disputes) must be brought under the FLSA." Id.

The Ninth Circuit noted that the only category of preemption that might apply to the plaintiffs' state law claim was conflict preemption. Id. at 760. "Conflict preemption applies where it is impossible to comply with both state and federal requirements or where state law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress." Id. (internal citations omitted).

In analyzing whether conflict preemption applied to the plaintiffs' §17200 claim, the panel stated that where, as in the case of §17200, "the state and federal requirements are the same, it is obviously possible to comply with both laws simultaneously." Id. The panel also recounted its holding in Williamson that the purpose of the FLSA was not to protect employers as well as employees, but that the central purpose of the FLSA was to enact minimum wage and maximum hour provisions to protect employees. Id. (citing Williamson, 208 F.3d at 1153-54). The court found that allowing the employees to pursue the §17200 1 claim would further the FLSA's purpose of protecting employees. Wang, 623 F.3d at 760. 2 The panel ultimately held that the FLSA does not preempt a state-law §17200 claim 3 that borrows its substantive standard from the FLSA. Id. In reaching that conclusion, the 4 panel specifically refused to follow Anderson v. Sara Lee Corp., 508 F.3d 181, 194-95 (4th 5 Cir. 2007), id. at 760, which this Court relied on in granting Defendant's Motion for Partial 6 Judgment on the Pleadings. 7 Although not necessarily pertinent to this Court's earlier ruling, the panel went on to 8 hold that the district court did not err ...


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