Trial | CALIFORNIA CLASS ACTION LAW

September 30, 2010

Ninth Circuit Affirms in All Respects Trial Court’s Entry of Judgment and Award of Attorneys Fees After Jury and Bench Trial of California Labor Code Class Action and FLSA Collective Action Claims

: Image by swanksalot via Flickr

On Monday, the U.S. Court of Appeals for the Ninth Circuit affirmed in “all respects” the trial court’s grant of partial summary judgment to plaintiffs, a judgment after jury and bench trials, and an award of attorney’s fees to plaintiffs. Wang v. Chinese Daily News, Inc., Nos. 08-55483, 08-56740, — F.3d —-, 2010 WL 3733568 (9th Cir. Sept. 27, 2010). Among other things, the Ninth Circuit held that plaintiff newspaper reporters were non-exempt. (Thank you to Randy Renick for bringing this case to my attention.)

Background

Employees of Chinese Daily News, Inc. (“CDN”), a Chinese-language newspaper, filed suit against CDN on behalf of current, former, and future CDN employees based in CDN’s San Francisco and Monterey Park (Los Angeles), California locations. Id. *1. Plaintiffs claimed violations of the FLSA, California’s Labor Code, and California’s Unfair Competition Law, Cal. Bus. & Prof. Code § 17200, alleging that employees were made to work in excess of eight hours per day and forty hours per week. Id. They further alleged that they were wrongfully denied overtime compensation, meal and rest breaks, accurate and itemized wage statements, and penalties for wages due but not promptly paid at termination. Id. The district court certified the FLSA claim as a collective action, and it certified the state-law claims as a class action under Rule 23(b)(2) and, alternatively, under Rule 23(b)(3). Id. Read the rest of this entry »

September 28, 2010

Second District Reverses Judgment in a Class Action of $99,000 and Attorneys Fees of $881,715

: Image via Wikipedia

The Second District reversed a trial court’s judgment in favor of employees in a class action trial. Pearline Zalewa v. Tempo Research Corporation, B210429, 2010 WL 3735240 (Cal. Ct. App. 2d Dist. Sept. 27, 2010). Defendant fiber-optic equipment manufacturer was sued in a class action by its former employees who claimed that the manufacturer breached an obligation to pay them annual bonuses, an obligation that allegedly continued for years after they were laid off from work during a business downturn. Id. The court concluded that the employees are not entitled to any recovery: “All but two of the employees relinquished their right to sue when they were laid off, in return for compensation that exceeded their earned severance pay. In any event, there was no promise made to pay bonuses to the employees after they were laid off.” Id.

The Trial Court’s Judgment

The trial court conducted a bench trial in January 2008, finding that plaintiffs were entitled to recover a direct bonus under theories of breach of contract, promissory estoppel, accounting, and unfair business practices. Id. The court deemed the bonus payments to be “wages” under the Labor Code. Id. And because the bonus payments are wages, plaintiffs were awarded prejudgment interest and attorney fees under the Labor Code. Id. The court enumerated the amount of the award for each employee, less offsets for monies already paid by defendants, plus interest. Id. The total amount of the award, including interest, was approximately $99,000, and plaintiffs’ counsel was awarded attorney fees of $881,715. Id. Read the rest of this entry »

August 13, 2010

District Judge William Alsup Issues Order in Gutierrez v. Wells Fargo Bank Class Action After 2 Week Bench Trial

: Image by Getty Images via @daylife

District Judge William Alsup issued an order in Gutierrez, et al. v. Wells Fargo Bank, N.A., — F.Supp.2d —-, 2010 WL 3155934 (N.D. Cal. Aug. 10, 2010), a certified consumer class action challenging hundreds of millions of dollars in overdraft fees imposed on depositors of Wells Fargo Bank, N.A. through allegedly unfair and fraudulent business practices.

Judge Alsup issued his decision following a two-week bench trial.

The essence of the case is that Wells Fargo has devised a bookkeeping device to turn what would ordinarily be one overdraft into as many as ten overdrafts, thereby dramatically multiplying the number of fees the bank can extract from a single mistake. The draconian impact of this bookkeeping device has then been exacerbated through closely allied practices specifically “engineered”–as the bank put it–to multiply the adverse impact of this bookkeeping device. These neat tricks generated colossal sums per year in additional overdraft fees, just as the internal bank memos had predicted. The bank went to considerable effort to hide these manipulations while constructing a facade of phony disclosure.

Judge Alsup held that these “manipulations were and continue to be unfair and deceptive in violation of Section 17200 of the California Business and Professions Code.” The Court ordered restitution enjoined the bookkeeping device under Cal. Bus. & Prof. Code section 17203.

By CHARLES H. JUNG

Category: Trial