Graham v. Stryker Corp.

• Court: District Court, E.D. California
• Decided: February 4, 2025
• Docket: 2:24-cv-01411
• Status: Unknown

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 JONATHAN GRAHAM, on behalf of No. 2:24-cv-1411-DJC-JDP 11 himself and all others similarly 12 situated and as a representative for the State of California, 13 ORDER DENYING MOTION TO REMAND Plaintiff, 14 15 v. 16 STRYKER CORPORATION; STRYKER EMPLOYMENT COMPANY, LLC; 17 STRYKER MEDICAL AND SURGICAL CORPORATION; and DOES 1 through 18 50, inclusive, 19 Defendants. 20 21 22 Plaintiff seeks remand of this case to state court arguing that there is not 23 complete diversity and that the minimum amount in controversy has not been met. 24 The Court disagrees, finding that there is complete diversity of citizenship and that the 25 amount in controversy exceeds $75,000. Accordingly, for the reasons set forth below, 26 the Court will DENY remand. 27 //// 28 //// 1 BACKGROUND 2 Plaintiff Jonathan Graham is a former employee of Defendants Stryker 3 Corporation, Stryker Medical and Surgical Equipment Corporation, and Stryker 4 Employment Company, LLC (“Stryker Employment”). (Removal Not., Ex. A (“Compl.”) 5 (ECF No. 1-1) ¶ 8.) Plaintiff, who worked from home as an account manager, 6 contacted customers, traveled to customers’ locations to service those customers and 7 sell Defendant’s equipment/products, attended meetings, and completed 8 administrative requirements related to customer purchases of Defendants’ 9 services/products. (Id.) Plaintiff was paid on a commission basis. (Id. ¶ 9.) 10 In order to perform these job duties, Defendants required Plaintiff to use his 11 personal cell phone, vehicle, and electronic equipment to contact customers and sell 12 equipment. (Id. ¶¶ 8, 11.) However, instead of reimbursing Plaintiff for these and 13 other work-related expenses, “Defendants devised a system whereby account 14 managers not only front[ed] the work-related costs incurred, but in actuality [paid] for 15 their own expenses.” (Id. ¶ 11.) Initially, Defendants withheld 1% from each account 16 managers’ commission wages “and, when account managers such as Plaintiff 17 submitted expense reimbursement requests, Defendants deducted the expense 18 reimbursement amounts from the 1% deducted from the account managers’ 19 commission wages and paid this amount back to the account managers.” (Id. ¶ 12.) 20 Hence, Plaintiff alleges “Defendants never reimbursed account managers for any 21 work-related expenses incurred.” (Id.) “Rather, account managers such as Plaintiff 22 paid for all of the work-related expenses they incurred out of their own commission 23 wages.” (Id.) 24 “Under this system, if account managers did not submit sufficient 25 reimbursement requests to total the 1% withheld from account managers’ commission 26 wages,” then Defendants would pay out any amount not used for reimbursements to 27 the account managers on a quarterly basis, a process called a “true-up.” (Id. ¶¶ 14– 28 15.) However, Plaintiff alleges this true-up “did not always occur on the schedule that 1 Defendants promised.” (Id. ¶ 15.) Further, Plaintiff alleges this true-up was referred to 2 as a “quarterly expense management bonus,” but was not a bonus at all as it was 3 merely the remaining commission wages from the 1% withheld. (Id.) 4 At some point, Defendants modified their system to deduct $2,000 a month 5 from each account managers’ commissions instead of 1%. (Id. ¶ 16.) Otherwise, the 6 system worked the same, as Defendants continued to reimburse account managers 7 for their work expenses from the amount withheld. (Id.) Defendants also continued to 8 state they would conduct a quarterly true-up, and, if the reimbursements were less 9 than the amount withheld, that they would pay the remaining commission to account 10 managers as a “quarterly expense management bonus.” (Id.) However, Plaintiff 11 alleges Defendants have failed to conduct a true-up since mid-2023. (Id.) 12 As a result of this reimbursement system, Plaintiff alleges that Defendants have 13 “failed to pay the account managers for all earned wages[,]” improperly taken 14 deductions, failed to pay “account managers all of their commission wages when they 15 are due[,]” “failed to provide account managers with a signed commission plan setting 16 forth how it calculated commissions owed[,]” and “failed to furnish accurate wage 17 statements.” (Id. ¶¶ 17–21.) In addition, Defendants “fail[ed] to actually furnish the 18 wage statements to its employees[,]” as “Defendants only make the wage statements 19 available on-line.” (Id. ¶ 21.) 20 Plaintiff brought this putative class action for (1) failure to pay wages when due 21 under California Labor Code sections 201–204, (2) wage statement violations under 22 Labor Code section 226, (3) reimbursement violations under Labor Code section 23 2802, (4) unauthorized deductions under Labor Code section 221, (5) unfair 24 competition under California Business & Professions Code section 17200, et seq., and 25 (6) Private Attorneys General Act (“PAGA”) penalties under Labor Code section 2698, 26 et seq., on April 11, 2024, in Sacramento County Superior Court. (Id. ¶¶ 30–63.) 27 Defendants removed the matter to federal court based on diversity jurisdiction on 28 May 17, 2024. (See Removal Not. (ECF No. 1).) Plaintiff moved to remand on June 13, 1 2024. (Mot. Remand (ECF No. 10).) The matter is fully briefed and was submitted 2 without oral argument pursuant to Local Rule 230(g). (ECF No. 16.) 3 LEGAL STANDARD 4 A case may be removed to federal court if that court would have jurisdiction 5 over the matter. See 28 U.S.C. § 1441; Hunter v. Philip Morris USA, 582 F.3d 1039, 6 1042 (9th Cir. 2009). Subject-matter jurisdiction exists in civil cases involving a federal 7 question or diversity of citizenship. 28 U.S.C. §§ 1331, 1332. Diversity jurisdiction 8 exists for all suits, including class-action suits, where “the matter in controversy 9 exceeds the sum or value of $75,000, exclusive of interest and costs,” and is between 10 parties with diverse citizenship. 28 U.S.C. § 1332(a). 11 “A motion to remand is the proper procedure for challenging removal.” Moore- 12 Thomas v. Alaska Airlines, Inc., 553 F.3d 1241, 1244 (9th Cir. 2009) (citing 28 U.S.C. 13 § 1447(c)). Removal statutes are “strictly construed, and any doubt about the right of 14 removal requires resolution in favor of remand.” Id. (citing Gaus v. Miles, Inc., 980 15 F.2d 564, 566 (9th Cir. 1992)). This “’strong presumption’ against removal jurisdiction 16 means that the defendant always has the burden of establishing that removal is 17 proper.” Gaus, 980 F.2d at 566. 18 The Ninth Circuit has explained that a plaintiff’s motion to remand is “the 19 functional equivalent of a defendant’s motion to dismiss for lack of subject matter 20 jurisdiction under Rule 12(b)(1).” Leite v. Crane Co., 749 F.3d 1117, 1122 (9th Cir. 21 2014). As such, a motion to remand may be based on either a facial attack or a factual 22 attack on the defendant’s jurisdictional allegations. See id. In a facial attack, the 23 challenger takes the allegations in the complaint as true but challenges whether those 24 allegations are sufficient to invoke jurisdiction. Safe Air for Everyone v. Meyer, 373 25 F.3d 1035, 1039 (9th Cir. 2004). By contrast, in a factual attack, the challenger 26 disputes the truth of the allegations that, by themselves, would otherwise invoke 27 federal jurisdiction. Id. A factual attack typically introduces evidence outside the 28 pleadings, and the party asserting federal jurisdiction must then “support [their] 1 jurisdictional allegations with ‘competent proof,’ . . . under the same evidentiary 2 standard that governs in the summary judgment context,” and must establish federal 3 jurisdiction by a preponderance of the evidence. Leite, 749 F.3d at 1121 (citations 4 omitted). “[I]f the existence of jurisdiction turns on disputed factual issues, the district 5 court may resolve those factual disputes itself.” Id. (citations omitted). 6 DISCUSSION 7 I. Plaintiff’s Evidentiary Objections 8 Plaintiff mounts several objections to the declarations relied on by Defendants 9 in their briefings to support their allegations that the Parties are diverse and the 10 amount in controversy is met. First, Plaintiff objects to the declaration of Aliyya Rizley, 11 Senior Director at Workplace Practices Americas, attached to Defendants’ Notice of 12 Removal on the basis that it “is speculative and self-serving, fails to establish that Ms. 13 Rizley has personal knowledge of the matters to which she attests, and contains 14 inadmissible hearsay.” (Mot. Remand at 13–14; see also ECF No. 10-1 (objecting to 15 Rizley Decl. (ECF No. 1-4).) In response, Defendants provide two new declarations in 16 support of removal: (1) the declaration of defense counsel Michele J. Beilke (“Beilke 17 Declaration”); and (2) the declaration of Michael Puca, Vice President at Workplace 18 Practices America (“Puca Declaration”). (See Puca Decl. (ECF No. 12-4); Beilke Decl. 19 (ECF No. 12-6).) Plaintiff objects to the Puca Declaration as relying on “inadmissible 20 hearsay” (see Reply (ECF No. 14) at 13), and to the Puca and Beilke Declarations 21 based on a lack of foundation, lack of personal knowledge, and/or failing to provide 22 the best evidence (see generally ECF No. 14-1). 23 The Court finds these objections lack merit. Plaintiff’s hearsay objections to the 24 Puca Declaration are overruled because the factual information underlying the 25 hearsay could be admitted at trial. See Pfingston v. Ronan Eng’g Co., 284 F.3d 999, 26 1004 (9th Cir. 2002). Similarly, Plaintiff’s lack of foundation objections are overruled 27 because such problems are nonfatal if “the substance could conceivably be made 28 admissible at trial.” Portnoy v. City of Davis, 663 F. Supp. 2d 949, 953 (E.D. Cal. 2009) 1 (quotation marks omitted). Finally, Plaintiff’s objections based on the best evidence 2 rule are overruled for the same reason,1 as all of the documentary and factual material 3 produced in the declarations could be introduced at trial by Defendants’ Person Most 4 Knowledgeable and custodians of record. (See ECF No. 12-3 at 2 and n.1 (explaining 5 that Workplace Practices America is not a separate company from Defendants);) see 6 also Hughes v. United States, 953 F.2d 531, 543 (9th Cir. 1992) (holding an affidavit 7 could be considered on summary judgment despite hearsay and best evidence rule 8 objections because the facts underlying the affidavit were of the type that would be 9 admissible evidence even though the affidavit itself might not be admissible). 10 Plaintiff also argues that the Puca Declaration lacks personal knowledge. (See 11 ECF No. 14-1 at 2–12.) However, the Puca Declaration states that it is based on 12 personal knowledge (see Puca Decl. ¶ 1), and on a “review of the[ ] corporate 13 records”2 (id. ¶ 2; see id. ¶ 6). That is sufficient at this stage because Defendants have 14 clarified that Workplace Practices America, where Mr. Puca works, is not a separate 15 company from Defendants. (ECF No. 12-3 at 2 and n.1.) 16 Therefore, Plaintiff’s evidentiary objections are overruled. 17 II. Defendants Have Established Complete Diversity 18 The party seeking to invoke a district court’s diversity jurisdiction bears the 19 burden of both pleading and proving that jurisdiction. NewGen, LLC v. Safe Cig, LLC, 20 840 F.3d 606, 613–14 (9th Cir. 2016). For the purposes of diversity, courts look to a 21

22 1 To the extent Plaintiff objects to the Puca Declaration because it confirms any negatives, i.e., that “there is no legal entity known as ‘Stryker Medical and Surgical Equipment Corporation[,]’” that “Stryker 23 Corporation’s most recent Form 10-K does not list ‘Stryker Medical and Surgical Equipment Corporation’ as a subsidiary[,]”and that “Stryker Employment did not make any additional payments to 24 Plaintiff between the last day of his employment and 30 days thereafter[,]” (Puca Decl. ¶¶ 6, 10.e), that evidence is not subject to the best evidence rule. See Fed. R. Evid. 1002, Advisory Committee Notes 25 1972 Proposed Notes (“Nor does the rule apply to testimony that books or records have been examined and found not to contain any reference to a designated matter.”). Thus, those objections are 26 overruled. 27 2 Mr. Puca explains that he is employed by Stryker Employment as Vice President at Workplace Practices and that, in that role, he is familiar with Defendants’ corporate structure and has access to 28 Defendants’ corporate and personnel records. (Puca Decl. ¶¶ 1–2, 7.) 1 party’s citizenship at the time the lawsuit was filed. Lew v. Moss, 797 F.2d 747, 750 2 (9th Cir. 1986). A person is a citizen of the state in which they are domiciled, and they 3 are domiciled where they reside and intend to remain indefinitely, or to where they 4 intend to return. Kanter v. Warner-Lambert Co., 265 F.3d 853, 857 (9th Cir. 2001). A 5 corporation is a citizen of every state and foreign state where it is incorporated and 6 has a principal place of business or “nerve center.” 28 U.S.C. § 1332(c)(1); Hertz v. 7 Friend, 559 U.S. 77, 92–93 (2010). The never center is normally “the place where the 8 corporation maintains its headquarters — provided that the headquarters is the actual 9 center of direction, control and coordination . . . and not simply an office where the 10 corporation holds its board meetings . . . .” Hertz, 559 U.S. at 93. A limited liability 11 company or partnership is a citizen of all of the states of which its partners are citizens. 12 See Johnson v. Columbia Props. Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006). 13 Here, the Court concludes that Defendants have established by a 14 preponderance of the evidence that there is complete diversity of citizenship. Plaintiff 15 alleges he is a citizen of California. (Compl. ¶ 24.) The sole Defendants are Stryker 16 Corporation and Stryker Employment.3 Plaintiff does not allege the residency of the 17 Defendants in the Complaint. Defendants, however, allege that Stryker Corporation is 18 a Michigan corporation with its principal place of business in Michigan. (See Removal 19 Not. ¶ 9.) Defendants also allege that Stryker Employment is an LLC with only one 20 member, Howmedica Osteonics Corp., a New Jersey corporation with its principal 21 place of business there. (See id. ¶ 10.) As evidence of these assertions, Defendants 22 offer the Puca Declaration, as well as corporate Statements of Information from the 23 California Secretary of State for Stryker Corporation and Stryker Employment. (See 24 Opp’n (ECF No. 12) at 5–6; Req. Judicial Not., Exs. 1–2 (ECF No. 12-2); Puca Decl. 25 ¶¶ 2–5.4) These materials establish by a preponderance of the evidence that Stryker

26 3 As the Puca Declaration establishes, “there is no legal entity known as ‘Stryker Medical and Surgical 27 Equipment Corporation.’” (Puca Decl. ¶ 6.) 28 4 Defendants asked that the Court take judicial notice of Exhibits 1 and 2, containing the Statements of 1 Corporation is a citizen of Michigan, that Stryker Employment is a citizen of New 2 Jersey, and that neither is a citizen of California. 3 Plaintiff complains that “there are other unmentioned executive leaders, who 4 may not be based outside of Michigan and who may be primarily responsible for the 5 direction, control, and coordination of [Stryker Corporation], in which event its nerve 6 center would be where they are located, not in Michigan.” (Reply at 4.) But 7 Defendants’ submitted materials indicate that many of these functions and officers are 8 in Michigan, which is enough at this stage to establish Michigan as Stryker 9 Corporation’s “nerve center.” See, e.g., Breitman v. May Co. Cal., 37 F.3d 562, 564 10 (9th Cir. 1994) (“May Company's corporate headquarters are located in Missouri, and 11 its executive and administrative functions are performed in that state. Therefore, the 12 district court properly found that May Company was a citizen of Missouri . . . .”). 13 Therefore, Stryker Corporation is a citizen of Michigan. 14 Because Defendants have established that Plaintiff is a citizen of California, 15 Stryker Corporation is a citizen of Michigan, and Stryker Employment is a citizen of 16 New Jersey, Defendants have established complete diversity of citizenship at this 17 stage. See Industrial Tectonics, Inc. v. Aero Alloy, 912 F.2d 1090, 1092 (9th Cir. 1990). 18 III. Defendants Have Established the Amount in Controversy 19 Where it is not facially evident from the complaint that more than $75,000 is in 20 controversy, the removing party must prove, by a preponderance of the evidence, that 21 the amount in controversy meets the jurisdictional threshold. Matheson v. Progressive 22 Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir. 2003) (per curiam). Here, the 23 Complaint alleges on information and belief that the amount in controversy “do[es] 24 not exceed $74,999.99.” (Compl. ¶ 5.) Defendants’ Removal Notice challenges this 25

26 Court takes judicial notice of these exhibits as public documents. See, e.g., Fair Hous. Council of Riverside Cnty., Inc. v. Grp. XIII Properties LP, No. EDCV 21-941 JGB (KKx), 2023 WL 4680764, at *4–5 27 (C.D. Cal. Apr. 27, 2023). However, the Court only takes judicial notice of the fact the documents exist, their authenticity, any undisputed facts, and any facts capable of easily being verified by the 28 documents. 1 assertion, alleging that the amount in controversy is at least “$108,063.” (Removal 2 Not. ¶ 24.) To reach this total, Defendants calculate the amount in controversy as 3 follows: $30,600 for the first cause of action, failing to pay wages at termination under 4 Labor Code section 203; $1,850 for the second cause of action, inaccurate wage 5 statements under Labor Code section 226; and $54,000 for the third cause of action, 6 failing to reimburse business expenses under Labor Code section 2802. (See 7 Removal Not. ¶¶ 16–21 and nn.1–3.) Defendants also calculate attorney’s fees based 8 on a 25% benchmark rate at $21,612.50. (See id. ¶¶ 23–24 and n.5.) 9 Defendants amend these calculations in their Opposition, calculating 10 $30,619.20 for the first cause of action; $1,950 for the second cause of action; and 11 $63,360.15 for the third cause of action. (See Opp’n at 12–14.) Defendants also 12 supplement the amount in controversy by calculating an additional $7,000 for the first 13 cause of action, failing to pay wages during employment under Labor Code section 14 204, and $7,000 for the fourth cause of action, unauthorized deductions under Labor 15 Code section 221.5 (See id. at 11, 15.) Defendants calculate attorney’s fees at 16 $27,482.34 based on a 25% contingency-fee benchmark, or $75,000 based on a 17 lodestar calculation assuming that Plaintiff’s counsel would be paid at a rate of at least 18 $750 per hour for at least 100 hours based on prior cases counsel litigated and other 19 wage and hour cases. (See id. at 15–17.) Accordingly, Defendants contend the 20 21

22 5 Plaintiff objects to the addition of these new damages in Defendants’ Opposition. (See Reply at 9–10.) However, Plaintiff concedes that he brings a factual attack against Defendants’ jurisdictional allegations. 23 (See Reply at 5–9.) Because Plaintiff brings a factual attack, the Court may consider the new arguments raised in Defendants’ Opposition as a constructive amendment of the Removal Notice. See Cohn v. 24 Petsmart, Inc., 281 F.3d 837, 840 n.1 (9th Cir. 2002) (citing Willingham v. Morgan, 395 U.S. 402, 407 n.3 (1969)). The Court can permit such amendment because Defendants’ new arguments and allegations 25 pertain to its theory of jurisdiction first raised in the Removal Notice, so the relevant allegations in the Removal Notice are “defective in form but not so lacking in substance as to prevent their amendment.” 26 Barrow Dev. Co. v. Fulton Ins. Co., 418 F.2d 316, 318 (9th Cir. 1969); see, e.g., Wang v. Asset Acceptance, LLC, 680 F. Supp. 2d 1122, 1125 (N.D. Cal. 2010). However, as demonstrated below, the 27 Court need not consider these new damages in order to reach the amount in controversy requirement for diversity jurisdiction. Thus, the Court declines to address Plaintiff’s objections that Defendants’ 28 calculations for these new damages are incorrect. (See Reply at 10–11.) 1 amount in controversy is satisfied as, assuming $75,000 in attorney’s fees, the total 2 amount in controversy would be $184,929.35. (Id. at 17.) 3 Plaintiff disputes these calculations for three reasons. First, Plaintiff challenges 4 Defendants’ method of calculating waiting time penalties for Plaintiff’s first claim for 5 failure to pay wages at termination “based on an average hourly rate of pay derived 6 from the commissions he earned during the last three months of his employment” and 7 the assumption that he “uniformly worked 40 hours per week and eight hours per 8 day,” arguing this method is unreasonable and unsupported by the Complaint. (Reply 9 at 7, 11.) Second, Plaintiff challenges Defendants’ assumption of a 100% violation rate 10 in calculating the damages recoverable on his first claim for failure to timely pay 11 wages at termination, second claim for failure to furnish accurate wage statements, 12 and third claim for unreimbursed business expenses. (Id. at 8, 13.) Finally, Plaintiff 13 challenges Defendants’ calculation of $63,360.15 for his third claim of unreimbursed 14 business expenses on the grounds that it is unsupported by admissible proof. (Id.) 15 For the reasons set forth below, the Court finds Plaintiff’s challenges to 16 Defendants’ calculations lack merit. Thus, Defendants have satisfied the amount in 17 controversy requirement. 18 A. The Waiting Time Penalties for Plaintiff’s First Cause of Action are 19 Reasonable and Supported by the Record 20 Under California Labor Code section 203, an employer who willfully fails to 21 timely pay all wages due at termination is subject to a statutory penalty of up to 30 22 days’ wages. Here, Plaintiff alleges he was not paid all commission wages owed at the 23 time of his termination. (Compl. ¶¶ 10, 19.) During Plaintiff’s last three months of 24 employment, Plaintiff earned $66,343.78 in commission wages, equaling a daily pay 25 rate of $1,020.67 assuming Plaintiff worked 8 hours per day and 40 hours a week. 26 (Opp’n at 13 n.9.) Thus, Defendants calculated Plaintiff’s claim for waiting penalties at 27 $30,619.20, or $1,020.67 per day x 30 days. (Id.) 28 //// 1 Plaintiff argues the Court should reject Defendants’ method of calculating the 2 waiting time penalties “based on the aggregate commissions plaintiff earned in the 3 final three-month period of his employment” because this is a hypothetical method for 4 calculating wages suggested by the State of California’s Department of Industrial 5 Relations (“DIR”). (See Reply at 11.) Plaintiff’s sole critique is that this method of 6 calculation is “not remotely binding on this Court” because DIR’s interpretation of a 7 statute is not binding. (Id. (citing Murphy v. Kenneth Cole Prods., Inc., 40 Cal. 4th 8 1094, 1105 n.7 (2007)).) The Court does not follow Plaintiff’s logic. Even if DIR’s 9 method is not binding, that does not mean the method is incorrect. DIR’s construction 10 of California’s Labor Code is at least “entitled to consideration and respect[.]” Murphy, 11 40 Cal. 4th at 1105 n.7. Moreover, Plaintiff offers no alternative, more reasonable 12 method for calculating his pay. As the Ninth Circuit has explained, when analyzing 13 amount in controversy calculations, “if a defendant provide[s] no evidence or clearly 14 inadequate evidence supporting its valuation for a claim, then it might be appropriate 15 for a district court to assign that claim a $0 value . . . [but] merely preferring an 16 alternative assumption is not an appropriate basis to zero-out a claim; at most, it only 17 justifies reducing the claim to the amount resulting from the alternative assumption.” 18 See Jauregui v. Roadrunner Transportation Servs., Inc., 28 F.4th 989, 994 (9th Cir. 19 2022). Thus, the Court finds that calculating Plaintiff’s pay rate based on his last three 20 months of commission wages is reasonable. 21 Plaintiff also argues that “[t]here is no factual basis, in the Puca Dec[laration] or 22 any record evidence, for assuming [that] Plaintiff worked 40 hours per week, five days 23 per week.” (Reply at 11.) However, the Puca Declaration states that the “Account 24 Manager position is a full-time position[,]” and that Stryker Employment assumes that 25 a full-time employee “works at least 40 hours per week (five days per week).” (Puca 26 Decl. ¶ 8.) That is sufficient at this stage. Accordingly, the Court finds Defendants’ 27 assumptions as to Plaintiff’s days and hours worked are reasonable. 28 //// 1 Finally, Plaintiff challenges Defendants’ assumption he is entitled to the 2 maximum penalty of 30 days’ wages. (See Reply at 12.) However, Plaintiff specifically 3 alleges that “Defendants did not pay Plaintiff and these proposed class members all 4 wages due either immediately upon termination or within seventy-two hours of 5 resignation, and failed to pay those sums for up to thirty days thereafter, in violation of 6 California Labor Code sections 201–202.” (Compl. ¶ 10.) The Puca Declaration also 7 establishes that “Stryker Employment did not make any additional payments to 8 Plaintiff between the last day of his employment and 30 days thereafter.” (Puca Decl. 9 ¶ 10.e.) Finally, Plaintiff was discharged around January 27, 2024 (see id. ¶ 8), but the 10 Complaint was not filed until April 11, 2024, more than 30 days after the fact. Thus, 11 Defendants have established by competent proof at this stage that Plaintiff is entitled 12 to waiting time penalties for the 30-day maximum. See Jauregui, 28 F.4th at 994 13 (finding assumption that class members were entitled to full 30-days of waiting time 14 penalties reasonable given that the members were terminated more than 30 days 15 before the filing of the complaint). 16 Because Defendants’ proposed method for calculating the waiting time 17 penalties is reasonable, the Court will include $30,619.20 in waiting time penalties 18 when totaling the amount in controversy. 19 B. The Wage Statement Penalties for Plaintiff’s Second Cause of Action 20 are Reasonable and Supported by the Record 21 Labor Code section 226 requires employers to furnish accurate itemized wage 22 statements. Here, Plaintiff alleges that, because Defendants retained a portion of his 23 commission wages and thus did not pay him all wages owed, the “wage statements 24 d[id] not reflect all gross and net wages owed account managers during the stated 25 pay periods.” (Compl. ¶ 21.) Pursuant to section 226(e)(1), a qualifying employee 26 may recover a statutory penalty of $50 for “the initial pay period in which a violation 27 occurs” and $100 “for each violation in a subsequent pay period.” Plaintiff received 20 28 wage statements (corresponding to 20 pay periods) from April 11, 2023, through his 1 termination. (Puca Decl. ¶ 10.) Thus, Defendants calculated a $50 penalty for the first 2 pay period and a $100 penalty for each subsequent pay period, totaling $1,950. 3 (Opp’n at 14.) 4 Plaintiff argues that Defendants incorrectly assume a 100% violation rate for his 5 wage statement claim because Defendants’ assumption “that the alleged violations 6 ‘would have been present in every single wage statement’ is unsupported by the 7 evidence, and contrary to the Compl.’s allegations” as “Paragraph 37 of the Compl. 8 states only that ‘during the relevant time period,’ Defendants failed to furnish wage 9 statements containing the information required by section 226(a) . . . .” (Reply at 12.) 10 Plaintiff argues that “Defendants offer no authority to refute the multiple decisions in 11 the Eastern District concluding that ‘at all relevant times’ and ‘during the relevant time 12 period’ do not refer to a violation rate or ‘necessarily mean that a violation always 13 occurred.’” (Reply at 12 (quoting Castillo v. Trinity Servs. Grp., Inc., No. 1:19-cv-01013- 14 DAD-EPG, 2020 WL 3819415, at *6 (E.D. Cal. July 8, 2020)).) 15 However, Plaintiff alleges that Defendants withheld first 1%, then $2,000 a 16 month, from his commission wages, and that because of these deductions, his wage 17 statements did not “reflect all gross and net wages owed . . . during the stated pay 18 periods.” (Id. ¶ 12–16, 21.) Thus, Plaintiff credibly alleges he received an inaccurate 19 wage statement every time he was paid, supporting a 100% violation rate.6 See 20 21

22 6 Plaintiff also alleges that Defendants never “actually furnish the wage statements to its employees[ ]” because “Defendants do not provide wage statements in hard copy, or give its employees the option of 23 obtaining their wage statements in hard copy[,]” but “only makes the wage statements available on- line.” (Compl. ¶ 21.) Although employers may provide wage statements online and not violate 24 California Labor Code section 226, that is only if the wage statements can be easily accessed and converted into hard copies, which Defendants do not do by failing to “give its employees the option of 25 obtaining their wage statements in hard copy.” (Compl. ¶ 21.) These allegations could also independently support a 100% violation rate. Cf., e.g., Apodaca v. Costco Wholesale Corp., No. CV 12- 26 5664 DSF (Ex), 2012 WL 12336225, at *2 (C.D. Cal. Oct. 29, 2012) (citing Opinion Letter from Robert A. Jones, Acting State Labor Commission and Chief Counsel, Division of Labor Standards Enforcement, to 27 Colette Wolf (July 6, 2006) (available at https://www.dir.ca.gov/dlse/opinions/2006-07-06.pdf), aff’d on other grounds, 675 F. App’x 663 (9th Cir. 2017); Patton v. Dollar Tree Stores, Inc., No. CV-15-03813- 28 MWF (PJWx), 2017 WL 8233880, at *3 (C.D. Cal. June 15, 2017). 1 Serrieh v. Jill Acquisition LLC, 707 F. Supp. 3d 968, 978 (E.D. Cal. 2023) (collecting 2 cases). 3 Thus, the Court will include $1,950 in wage statement penalties when totaling 4 the amount in controversy. 5 C. The Unreimbursed Business-Related Expenses for Plaintiff’s Third 6 Cause of Action are Reasonable and Supported by the Record 7 Finally, under Labor Code section 2802(a), "an employer shall indemnify his or 8 her employee for all necessary expenditures or losses incurred by the employee in 9 direct consequence of the discharge of his or her duties, or of his or her obedience to 10 the directions of the employer.” However, Plaintiff alleges that Defendants never 11 indemnified him or other account managers for their business-related expenses. 12 (Compl. ¶ 12.) Rather, Plaintiff alleges that Defendants withheld first 1%, then $2,000 13 a month, from his commission wages, and reimbursed his claimed business expenses 14 from those withheld wages, thereby making Plaintiff pay for his own expenses. (See 15 id. ¶¶ 12–17.) However, as Plaintiff argues, section 2802 does not allow “Defendants 16 to set up a system whereby employees, such as Plaintiff and the other similarly 17 situated account managers, pay for their own expenses.” (Id. ¶ 44.) Thus, Plaintiff 18 seeks reimbursement for the business-related expenses he incurred, which 19 Defendants calculate at $63,360.15 based on their records of all Plaintiff’s claimed 20 expenses. (Opp’n at 14.) 21 Plaintiff challenges this amount, arguing that Defendants’ assumption he should 22 recover on all of his claimed expenses is unreasonable because “the Compl. does not 23 allege that, during the three-year limitations period applicable to [P]laintiff’s 24 reimbursement violations claim, Defendants never reimbursed plaintiff for any 25 business expenses.” (Reply at 13.) However, Plaintiff plainly alleges that, because 26 Defendants reimbursed his business expenses out of improperly withheld portions of 27 his commission wages, he “never received reimbursements for [his] work-related 28 expenses” from Defendants. (Compl. ¶¶ 31, 42–47.) Therefore, the Complaint 1 supports Defendants’ assumption that none of Plaintiff’s business-related expenses 2 were properly reimbursed. 3 Plaintiff also challenges “Defendants’ assumption that the amount of his 4 unreimbursed business-related expenses is $63,360.15 on the grounds [that] it is 5 unsupported by any admissible proof.” (Reply at 8, 13.) However, Defendants 6 support this calculation with Exhibit A to the Puca Declaration, which details Plaintiff’s 7 claimed business expenses based on a search of Defendants’ records. (See Puca 8 Decl. ¶ 9 (explaining Mr. Puca’s search of Defendants’ records); Puca Decl., Ex. A (ECF 9 No. 12-5) (spreadsheet detailing reimbursement requests).) As discussed in Section I 10 supra, the Court may properly consider the factual material underlying Exhibit A, 11 whose contents could be admitted at trial. 12 Thus, the Court will include $63,360.15 in unreimbursed business expenses 13 when totaling the amount in controversy. 14 D. The Challenge to the Attorney’s Fees Calculation Are Moot 15 The amount in controversy is easily satisfied based on Plaintiff’s first through 16 third claims, which total $95,929.35.7 As a result, the Court need not consider 17 Defendants’ attorney’s fees calculations. Cf., e.g., Alvarez v. Off. Depot, Inc., No. CV 18 17-7220 PSG (AFMx), 2017 WL 5952181, at *4 (C.D. Cal. Nov. 30, 2017); Ibarra v. 19 Manheim Invs., Inc., 775 F.3d 1193, 1198 n.2 (9th Cir. 2015). 20 //// 21 //// 22 //// 23 //// 24 //// 25 //// 26 //// 27

28 7 ($30,619.20) + ($1,950) + ($63,360.15) = $95,929.35. (See Opp’n at 17.) 1 CONCLUSION 2 For the reasons set forth above, the Court finds the requirements for diversity 3 | jurisdiction are met as the Parties are diverse and the amount in controversy is over 4 | $75,000. Accordingly, the Court DENIES Plaintiff's Motion to Remand. (ECF No. 10.) 5 Defendants are ORDERED to file their answers or other responsive pleadings 6 | within twenty-one (21) days of this Order. 7 8 | Dated: February 3, 2025 “Daneel J Cob brat 9 THE HONOR E DANIEL J. CALABRETTA UNITED STATES DISTRICT JUDGE 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28