In re Ardagh Glass

• Court: District Court, N.D. California
• Decided: February 13, 2024
• Docket: 4:23-cv-03547
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 ALEX CASTANEDA, Case No. 23-cv-03547-HSG

8 Plaintiff, ORDER DENYING MOTION TO REMAND AND GRANTING MOTION 9 v. TO DISMISS

10 ARDAGH GLASS INC., Re: Dkt. Nos. 18, 19 11 Defendant.

12 Before the Court is Plaintiff’s motion to remand and Defendant’s partial motion to dismiss. 13 Dkt. Nos. 18, 19. The Court finds these matters appropriate for disposition without oral argument 14 and the matters are deemed submitted. See Civil L.R. 7-1(b). For the reasons discussed below, 15 the Court DENIES Plaintiff’s motion to remand and GRANTS Defendant’s motion to dismiss.1 16 I. BACKGROUND 17 Plaintiff Alex Castaneda was employed by Defendant Aradgh Glass. Compl. ¶ 10. 18 Plaintiff alleges that Defendant failed to provide him and other similarly situated employees “all 19 overtime and double-time and the proper regular rate of pay,” “uninterrupted, off-duty meal 20 periods,” nor “uninterrupted, on-the-clock rest period[s].” Id. at ¶ 28–37. Plaintiff filed a putative 21 class action complaint in Alameda Superior Court against Defendant. Dkt. No. 1. Plaintiff alleges 22 the following causes of action: (1) failure to pay minimum wages (violation of California Labor 23 1 Defendant submitted a request for judicial notice of several CBAs. See Dkt. No. 20. The Court 24 finds that the CBAs are “not subject to reasonable dispute” because they contain facts that can be “accurately and readily determined from sources whose accuracy cannot reasonably be 25 questioned.” Fed. R. Evid. 201(b)(2). The Court thus takes judicial notice of the content of the CBAs. 26

Defendant also requests judicial notice of a United States Bureau of Labor Statistics online 27 publication which provides consumer expenditure information. See Dkt. No. 22. The Court takes 1 Code §§ 1194, 1193.2l and 1197); (2) failure to pay overtime wages (violation of California Labor 2 Code §§ 510, 1194, and 1198); (3) failure to provide meal periods (violation of California Labor 3 Code §§ 226.7 and 512); (4) failure to permit rest breaks (violation of California Labor Code § 4 226.7); (5) failure to provide accurate itemized wage statements (violation of California Labor 5 Code § 226); (6) failure to reimburse business expenses (violation of California Labor Code §§ 6 2800 and 2802); and (7) Violation of California Business and Professions Code (California Labor 7 Code § 17200). Compl. ¶¶ 38–89. 8 Defendant removed the case to this Court. Dkt. No. 1. Plaintiff filed a motion to remand, 9 Dkt. No. 18, and Defendant filed a partial motion to dismiss, Dkt. No. 19. 10 II. MOTION TO REMAND 11 A. Legal Standard for Section 301 Preemption 12 “Except as otherwise expressly provided by Act of Congress, any civil action brought in a 13 State court of which the district courts of the United States have original jurisdiction, may be 14 removed” to federal court. 28 U.S.C. § 1441(a). Under § 301 of the Labor Management Relations 15 Act (LMRA), “[s]uits for violation of contracts between an employer and a labor organization . . . 16 may be brought in any district court of the United States.” 29 U.S.C. § 185(a). As explained by 17 the Ninth Circuit, the Supreme Court has interpreted the LMRA to authorize federal courts “to 18 create a uniform body of federal common law to adjudicate disputes that arise out of labor 19 contracts.” Curtis v. Irwin Indus., Inc., 913 F.3d 1146, 1155 (9th Cir. 2019) (citations omitted). 20 “A state rule that purports to define the meaning or scope of a term in a contract suit therefore is 21 pre-empted by federal labor law.” Id. at 1152 (quoting Allis-Chalmers Corp. v. Lueck, 471 U.S. 22 202, 210 (1985)). Although federal preemption is a defense that does not generally authorize 23 removal to federal court, the Supreme Court has held that § 301 has such “extraordinary pre- 24 emptive power” that it “converts an ordinary state common law complaint into one stating a 25 federal claim for purposes of the well-pleaded complaint rule.” Metro. Life Ins. v. Taylor, 481 26 U.S. 58, 65 (1987). 27 However, § 301 “cannot be read broadly to pre-empt nonnegotiable rights conferred on 1 Bradshaw, 512 U.S. 107, 123 (1994)). Further, “not every dispute concerning employment, or 2 tangentially involving a provision of a collective-bargaining agreement, is preempted by § 301 or 3 other provisions of federal labor law.” McCray v. Marriott Hotel Servs., Inc., 902 F.3d 1005, 4 1009 (9th Cir. 2018) (quoting Lueck, 471 U.S. at 211). Claims which have no relationship to a 5 collective-bargaining agreement “beyond the fact that they are asserted by an individual covered 6 by such an agreement are simply not pre-empted by § 301.” Id. (citation and quotations omitted). 7 The Ninth Circuit has employed a two-step test to ensure that § 301 preemption “extends 8 only as far as necessary to protect the role of labor arbitration in resolving CBA disputes.” Curtis, 9 913 F.3d at 1153 (citation and quotations omitted). First, the court asks whether the asserted cause 10 of action involves a “right [that] exists solely as a result of the CBA.” Burnside v. Kiewit Pac. 11 Corp., 491 F.3d 1053, 1059 (9th Cir. 2007). “If the right exists solely as a result of the CBA, then 12 the claim is preempted, and our analysis ends there.” Id. (citing Lueck, 471 U.S. at 210). If not, 13 the court proceeds to the second step and asks “‘whether a plaintiff's state law right is substantially 14 dependent on analysis of [the CBA],’ which turns on whether the claim cannot be resolved by 15 simply ‘look[ing] to’ versus ‘interpreting’ the CBA.” Curtis, 913 F.3d at 1153 (citations and 16 quotations omitted and alterations in original). “Interpretation” is construed narrowly in this 17 context. Id. If claims are dependent on interpretation of the CBA, then the claim is preempted by 18 § 301; if not, the claim may proceed under state law. Burnside, 491 F.3d at 1059–60. 19 B. Discussion 20 Plaintiff argues that this case should be remanded because Defendant has failed to establish 21 federal subject matter jurisdiction or diversity jurisdiction. In response, Defendant argues that (1) 22 the Court has subject matter jurisdiction because Plaintiff’s claims are preempted by the LMRA; 23 and (2) Defendant has established diversity jurisdiction under CAFA because the amount in 24 controversy exceeds $5 million. 25 i. LMRA Preemption 26 Defendant contends that Plaintiff’s Second, Fifth, and Seventh causes of action – for 27 failure to pay overtime wages under California law – “are premised on a California Labor Code 1 California Labor Code section 514 (“Section 514”) are met.” Opp. at 7. Defendant argues that 2 “Plaintiff’s claim for overtime only exists because of the terms of the applicable CBAs and not 3 state law, which renders his claim preempted by Section 301 of the LMRA.” Id. (quoting Curtis, 4 913 F.3d at 1154). In response, Plaintiff argues that Curtis is inapplicable because in that case, 5 plaintiff “conceded the applicability of the CBAs,” while here “Plaintiff disputes that any CBA 6 applies to his overtime claims, which are alleged solely under state law and [] are pled without any 7 implication of, or reliance on, the CBA.” Reply at 3–4. Further, Plaintiff contends that no 8 alternative workweek schedule exists under any of the CBAs, such that Section 514 does not 9 apply. Finally, Plaintiff argues that his overtime claims are not only alleged under Labor Code § 10 510, but also §§ 1194 and 1198, which provide a separate private right of action for overtime 11 violations that is not exempted by Labor Code § 514. 12 California Labor Code Section § 510(a) requires an employer to pay the following 13 overtime rates: (a) Eight hours of labor constitutes a day's work. Any work in excess 14 of eight hours in one workday and any work in excess of 40 hours in any one workweek and the first eight hours worked on the seventh 15 day of work in any one workweek shall be compensated at the rate of no less than one and one-half times the regular rate of pay for an 16 employee. Any work in excess of 12 hours in one day shall be compensated at the rate of no less than twice the regular rate of pay 17 for an employee. In addition, any work in excess of eight hours on any seventh day of a workweek shall be compensated at the rate of no 18 less than twice the regular rate of pay of an employee. Nothing in this section requires an employer to combine more than one rate of 19 overtime compensation in order to calculate the amount to be paid to an employee for any hour of overtime work. The requirements of this 20 section do not apply to the payment of overtime compensation to an employee working pursuant to any of the following: 21 (1) An alternative workweek schedule adopted pursuant to Section 22 511. (2) An alternative workweek schedule adopted pursuant to a 23 collective bargaining agreement pursuant to Section 514. (3) An alternative workweek schedule to which this chapter is 24 inapplicable pursuant to 25 Cal. Lab. Code § 510(a). Concurrently, Section 514 precludes application of Section 510 if a 26 CBA “expressly provides for the wages, hours of work, and working conditions of the employees, 27 and if the agreement provides premium wage rates for all overtime hours worked and a regular 1 wage.” Labor Code § 514. 2 Curtis controls the resolution of the parties’ dispute on this point. In Curtis, the Ninth 3 Circuit held that overtime claims under California Labor Code § 510 are controlled by the CBA if 4 the CBA satisfies the requirements of California Labor Code § 514. Curtis, 913 F.3d at 1155. 5 Based on the language in §§ 510 and 514, the Ninth Circuit held that where a CBA meets the 6 requirements of § 514, a plaintiff’s § 510 claim for overtime is “controlled” by the CBA and 7 therefore preempted by § 301 of the LMRA. Id. 8 Under Curtis, the Court must determine whether the applicable CBAs satisfy the 9 requirements of § 514. The applicable CBAs are: (1) the April 1, 2022 CBA for mold making 10 workers, Evans Decl., Ex. 1; (2) the April 1, 2022 CBA for automatic machine workers, Evans 11 Decl., Ex. 2; (3) the September 1, 2022 CBA for mold making workers, Evans Decl., Ex. 3; (4) the 12 April 1, 2019 CBA for production and maintenance workers, Evans Decl., Ex. 4; (5) the April 1, 13 2019 CBA for automatic machine workers, Evans Decl., Ex. 5; (6) the September 1, 2019 CBA 14 for mold making workers, Evans Decl., Ex. 6; (7) the April 1, 2016 CBA for production and 15 maintenance workers, Evans Decl., Ex. 7; (8) the April 1, 2016 CBA for automatic machine 16 Workers, Evans Decl., Ex. 8; and (9) the September 1, 2016 CBA for mold making workers, 17 Evans Decl., Ex. 9. Evans Decl. ¶¶ 4–12. 18 Having reviewed the CBAs and Defendant’s declarations, the Court finds that the CBAs 19 satisfy the requirements of § 514. First, the CBAs provide for wages, hours of work, and working 20 conditions. See Ex. 4 (Article 6 specifying the conditions of employment, including, hiring, 21 releasing, quitting, and discharging and discipline; Article 11 specifying that forty hours shall 22 constitute a normal work week and that eight hours shall constitute a normal workday, and 23 delineating the scope and definition of overtime hours; Article 31 specifying health and safety 24 conditions; Article 43 specifying wage rate increases). The CBAs also provide for premium rates 25 for overtime work. See id. at Article 11 (specifying that premium rates will apply to overtime 26 work, in that “[t]ime and one-half shall be paid after eight (8) hours in any day or forty (40) hours 27 in any one (1) week” and [d]ouble time will also be paid for all hours worked over twelve (12) 1 of pay of at least 30 percent higher than California’s minimum wage. See id. at Schedule A 2 (setting pay ray rates no lower than $21.60); see California Labor Code § 1182.12 (setting a 3 minimum wage of $10 per hour on or after January 1, 2016, and scheduled annual increases up to 4 $15 per hour on or after January 1, 2023). 5 Plaintiff does not challenge the substance of the CBAs, but instead argues that Curtis is 6 distinguishable because he “disputes that any CBA applies to his overtime claims, which are 7 alleged solely under state law and [] are pled ‘without any implication of, or reliance on, the 8 CBA.’” Reply at 3–4. But Plaintiff does not (and apparently cannot) offer any factual basis to 9 contest that his employment is governed by the CBAs, so the absence of an express concession is 10 of no consequence. See Franco v. E-3 Sys., No. 19-cv-01453-HSG, 2019 WL 6358947, at *4 11 (N.D. Cal. Nov. 8, 2019). Accordingly, the Court finds that Defendant has met its burden of 12 proving that the CBAs here satisfy the requirements of Section 514. 13 Plaintiff also argues that Section 514 does not apply here because he did not work an 14 alternative workweek schedule. Reply at 4. To support this proposition, Plaintiff argues that the 15 Curtis court found the plaintiff’s overtime claims preempted because the CBA there contained an 16 alternative workweek schedule, and contends that because no such schedule exists here, his claims 17 are not preempted. The Court disagrees. The Curtis court did not condition the applicability of 18 Section 514 to overtime claims on the inclusion of an alternative workweek provision. Instead, 19 Curtis straightforwardly held that “if a CBA satisfies the requirements of section 514, the 20 requirements of section 510(a) ‘do not apply.’” Curtis, 913 F.3d at 1154. The great majority of 21 district courts in this circuit have held that Section 514’s exemption operates independently from 22 the alternative work week exemption in Section 510(a)(2), and this Court agrees. See Johnson v. 23 San Francisco Health Care and Rehab Inc., No. 22-cv-01982-JSC, 2022 WL 2789809, at *3 24 (N.D. Cal. July 15, 2022) (“Section 514 ’s exemption operates independently from the exemption 25 in § 510(a)(2)”); Loaiza v. Kinkisharyo Int’l, LLC, No. LA CV19-07662JAK, 2020 WL 5913282, 26 at *4 (C.D. Cal. Oct. 6, 2020) (finding that there is no alternative workweek schedule requirement 27 for preemption); Cathcart v. Sara Lee Corp., 2011 WL 5981849, at *7 (N.D. Cal. Nov. 30, 2011) 1 the exemption set forth in § 514”).2 2 Finally, Plaintiff argues that his overtime claims are alleged not only under Labor Code § 3 510, but also under §§ 1194 and 1198, which provide a separate private right of action for 4 overtime violations that is not exempted by Labor Code § 514. However, the Court concludes that 5 a CBA that fulfills the requirements of § 514 also preempts overtime claims based on §§ 510, 6 1194 and 1198. See Jimenez v. Young’s Market Co., LLC, No. 21-cv-02410-EMC, 2021 WL 7 5999082, at *10 (N.D. Cal. December 20, 2021) (collecting cases finding preemption of overtime 8 claims under the LMRA because § 514 also applies to claims based on §§ 1194 and 1198). 9 Because Section 514 applies, Plaintiff’s overtime claims are preempted by Section 301 of 10 the LMRA.3 11 ii. Supplemental Jurisdiction 12 Plaintiff’s remaining claims under California law arise from the same working 13 conditions and relationship with Defendant during the same period as Plaintiff’s overtime 14 claim. See Compl. ¶¶ 38–89 (failure to pay minimum wages, failure to provide meal and rest 15 breaks, and failure to reimburse all business expenses.). Therefore, the Court finds that the 16 claims derive from a “common nucleus of operative fact” and asserts supplemental jurisdiction 17 over the remaining claims. Kuba v. 1-A Agr. Ass’n, 387 F.3d 850, 855 (9th Cir. 18 2004) (“Nonfederal claims are part of the same ‘case’ as federal claims when they derive from 19 a common nucleus of operative fact and are such that a plaintiff would ordinarily be expected 20 to try them in one judicial proceeding.” (citation and quotations omitted)). 21

22 2 Plaintiff relies on Flournoy v. Watts Healthcare Corp., No. 2:20-CV-06607-RGK-SK, 2020 WL 5960686 (C.D. Cal. Oct. 6, 2020), the only case that this Court has found that supports his 23 argument. The Court respectfully disagrees with Flournoy’s holding and agrees with those courts that have found no “alternative workweek” limitation. 24

3 Plaintiff also argues that remand is proper because Defendant has failed to meet the minimum 25 amount in controversy requirement for Class Action Fairness Act (CAFA) jurisdiction. See Mot. at 12. The Court does not reach this issue because subject matter jurisdiction exists under the 26 LMRA. Cf. Morand-Doxzon v. Delaware N. Comp. Sportservice, Inc., No.20-cv-1258-DMS, 2020 WL 6391194, at *1 & n.1 (S.D. Cal. November 2, 2020) (“The Court need not address the 27 parties’ argument as to whether there is federal question jurisdiction pursuant to Section 301 of the 1 Accordingly, Plaintiff’s motion to remand is DENIED. 2 III. MOTION TO DISMISS 3 Defendant moves to dismiss Plaintiff’s Second, Fifth, and Seventh Causes of Action. 4 A. Legal Standard 5 Federal Rule of Civil Procedure 8(a) requires that a complaint contain “a short and plain 6 statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). A 7 defendant may move to dismiss a complaint for failing to state a claim upon which relief can be 8 granted under Rule 12(b)(6). “Dismissal under Rule 12(b)(6) is appropriate only where the 9 complaint lacks a cognizable legal theory or sufficient facts to support a cognizable legal 10 theory.” Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008). To 11 survive a Rule 12(b)(6) motion, a plaintiff must plead “enough facts to state a claim to relief that is 12 plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim is facially 13 plausible when a plaintiff pleads “factual content that allows the court to draw the reasonable 14 inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 15 678 (2009). In reviewing the plausibility of a complaint, courts “accept factual allegations in the 16 complaint as true and construe the pleadings in the light most favorable to the nonmoving 17 party.” Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). 18 Nonetheless, courts do not “accept as true allegations that are merely conclusory, unwarranted 19 deductions of fact, or unreasonable inferences.” In re Gilead Scis. Secs. Litig., 536 F.3d 1049, 20 1055 (9th Cir. 2008). 21 B. Discussion 22 Defendant contends that Plaintiff’s Second, Fifth, and Seventh Causes of Actions are 23 preempted by Section 301 of the LMRA. This argument largely tracks Defendant’s argument in 24 its opposition to Plaintiff’s motion to remand. 25 As discussed at length above, Defendant is correct that Plaintiff’s overtime claims are 26 preempted by Section 301 of the LMRA, notwithstanding Plaintiff’s insistence that he only asserts 27 “state law claims.” And given the Court’s conclusion that the overtime claims are preempted by 1 law claim is substantially dependent upon analysis of the terms of an agreement made between the 2 parties in a labor contract, that claim must either be treated as a § 301 claim, or dismissed as 3 preempted by federal labor contract law.”); Granite Rock Co. v. Int’l Brotherhood of Teamsters, 4 CV. No. 10-3718-JW, 2010 WL 11703352, at *5 (N.D. Cal. November 3, 2010) (denying 5 plaintiff’s motion to remand because state law claim was preempted by the LMRA and granting 6 defendant’s motion to dismiss that claim because it was “completely preempted by Section 301 7 and hence subject to dismissal”).4 Accordingly, Plaintiff’s overtime claims are DISMISSED. 8 IV. CONCLUSION 9 The Court DENIES Plaintiff’s motion to remand. See Dkt. No.18. The Court GRANTS 10 Defendant’s motion to dismiss. See Dkt. No. 19. Because amendment would be futile, Plaintiff’s 11 Second Cause of Action is DISMISSED in its entirety without leave to amend. See Lopez v. 12 Smith, 203 F.3d 1122, 1127 (9th Cir. 2000) (en banc). Plaintiff’s Fifth and Seventh Causes of 13 Action are DISMISSED to the extent those claims are derivative of the Second Cause of Action. 14 The Court SETS a telephonic case management conference for February 27, 2024 at 15 2:00pm. The Court further DIRECTS the parties to submit a joint case management statement by 16 February 20, 2024. All counsel shall use the following dial-in information to access the call: 17 Dial-in: 888-808-6929 18 Passcode: 6064255 19 For call clarity, parties shall NOT use speaker phone or earpieces for these calls, and where at all 20 possible, parties shall use landlines. All attorneys appearing for a telephonic case management 21 4 Defendant argues that Plaintiff’s Fifth Cause of Action for failure to provide accurate itemized 22 wage statements and Seventh Cause of Action for violations of California Business and Professions Code § 17200, et seq., are derivative of the alleged failure to pay overtime asserted in 23 Plaintiff’s Second Cause of Action. Dkt. 19 at 17. In the Fifth Cause of Action, among other things, Plaintiff alleges that Defendant “confusingly broke out overtime and double time,” thus 24 causing injury, and in the Seventh Cause of Action alleges Defendant’s “fail[ure] to pay all overtime wages” was a violation of 17200. Both causes of action, at least in part, derive from 25 Plaintiff’s Second Cause of Action for failure to pay overtime wages. Accordingly, to the extent the Fifth and Seventh Causes of action are derivative of the preempted overtime claim, those 26 claims too are preempted. See Giles v. Canus Corp., 2022 WL 3370793, at *6 (N.D. Cal. Aug. 16, 2022) (“As discussed above, Giles’s minimum wage, overtime, and meal period claims are 27 preempted by the LMRA; consequently, to the extent his wage statement, waiting time, wrongful 1 conference are required to dial in at least 15 minutes before the hearing to check in with the CRD. 2 IT IS SO ORDERED. 3 |) Dated: 2/13/2024 4 ° mind S. GILLIAM, JR. / 5 United States District Judge 6 7 8 9 10 11 a 12

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