Ochoa v. McDonald's Corp.

133 F. Supp. 3d 1228, 25 Wage & Hour Cas.2d (BNA) 756, 2015 U.S. Dist. LEXIS 129539, 2015 WL 5654853
CourtDistrict Court, N.D. California
DecidedSeptember 25, 2015
DocketCase No. 14-cv-02098-JD
StatusPublished
Cited by24 cases

This text of 133 F. Supp. 3d 1228 (Ochoa v. McDonald's Corp.) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ochoa v. McDonald's Corp., 133 F. Supp. 3d 1228, 25 Wage & Hour Cas.2d (BNA) 756, 2015 U.S. Dist. LEXIS 129539, 2015 WL 5654853 (N.D. Cal. 2015).

Opinion

ORDER RE SUMMARY JUDGMENT

JAMES DONATO, United States District Judge

This ease is a putative class action for labor violations under California state law. Named plaintiffs Stephanie Ochoa, Ernes-tina Sandoval, Yadira Rodriguez, and Jasmine Hedgepeth have sued defendants The Edward J. Smith and Valerie S. Smith Family Limited Partnership and three McDonald’s entities — McDonald’s USA, McDonald’s Corporation, and McDonald’s California. Edward Smith and Valerie Smith, joined recently by their son Michael Smith, are franchisees of McDonald’s USA, and run five restaurants in Oakland and Richmond, California.1 All three of the McDonald’s defendants2 have moved for summary judgment that they are not joint employers of the plaintiffs and the putative class of current and former employees at the Smith restaurants, and that they are not liable on plaintiffs’ negligence claim. Plaintiffs agree that McDonald’s California should not be in the case, but oppose the McDonald’s motion in all other respects.

The Court grants and denies the motion in part. Even when viewed in the light most favorable to plaintiffs, the record before the Court compels the finding that the McDonald’s defendants do not directly employ the plaintiffs or the putative class, and are entitled to summary judgment on that issue. The McDonald’s defendants are also entitled to summary judgment against plaintiffs on negligence. But material fact disputes preclude summary judgment on the issue of whether the McDonald’s defendants are liable as a joint employer under an ostensible agency theory.

BACKGROUND

The four named plaintiffs are past and present employees of the Smith restau[1231]*1231rants. See First Amended Complaint (“FAC”) ¶¶ 8-11, Dkt. No. 40. They allege thirteen causes of action, most of which are California Labor Code claims against both Smith and the McDonald’s defendants. The second claim for relief — failure to pay overtime under California Labor Code §§ 510, 1194, 1194.5, and 1198 — is básed on allegations that the In-Store Processor (“ISP”) software Smith uses is programmed to assign all hours worked pn a shift to the day on which the shift starts, even if it continues into the next day. See FAC ¶¶ 160-68; Motion for Class Certification (“Mot. for Class Cert.”) at 5:12-6:1, Dkt. No. 100-5. The third claim for relief, for failure to pay minimum wages under California Labor Code §§ 1182.2, 1194, 1194.2, 1194.5, 1197, and 1198, is based on allegations that franchisee Valerie Smith, in the course of manually inputting each employee’s hours to send to a third-party vendor for payroll processing, incorrectly converted time reported in the “hour:minute” format to time recorded in an “hour:hundredths of an hour” format. See FAC ¶¶ 169-75; Mot. for Class Cert, at 4:18-5:11. The fourth and fifth claims, brought under California Labor Code §§ 226.7, 512, 1194.5, and 1198, allege that the plaintiffs were not provided the meal and rest breaks required by law. See FAC ¶¶ 176-91; Mot. for Class Cert. 6:2-9:17. The eighth claim for relief, under California Labor Code §§ 204 and 226, alleges that plaintiffs were given legally inadequate earnings statements. See FAC ¶¶ 206-13, Mot. for Class Cert. 10:3-7. The ninth claim for relief, brought under California Labor Code §§ 221, 450, 1198, 2802, and 1194.5, alleges that plaintiffs were not reimbursed for the time required to maintain their uniforms. See FAC ¶¶ 214-20; Mot. for Class Cert. 9:18-10:2.

Plaintiffs also allege negligence against the McDonald’s defendants as a tenth claim for relief. See FAC ¶¶ 221-25. The basis for the negligence claim is that the McDonald’s defendants injured the plaintiffs by “1) setting up the ISP to assign hours to the date the shift started, and failing to inform Smith about this, causing a failure to identify and pay daily overtime; 2) failing to train Smith appropriately on the ISP timekeeping and payroll systems, contributing to the miscalculated wages violations; 3) setting up the ISP to create schedules that do not take into account time needed for legally required rest breaks, pressuring Smith to cut labor costs, programming the ISP to not identify untimely rest breaks as rest break violations (and not notifying Smith), and failing to provide a mechanism in the ISP and payroll systems for the payment of an hour’s wages to a crew member who has a missed, late, or short break; 4) requiring crew members to wear clean and neat McDonald’s uniforms; and 5) causing Smith not to list McDonald’s as an employer on wage statements.” Plaintiffs Opposition at 29:18-26, Dkt. No. 196-4.

DISCUSSION

Summary judgment is appropriate when the pleadings, discovery and affidavits show that there is “no genuine dispute as to any material fact and [that] the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). Material facts are facts that may affect the outcome of the case. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A dispute over a material fact is genuine if there is sufficient evidence for a reasonable jury to return a verdict for the nonmoving party. Id.

The moving party for summary judgment bears the initial burden of identifying the portions of the pleadings, discovery and affidavits that demonstrate the absence of a genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Where the moving party will have the [1232]*1232burden of proof on an issue at trial, it must affirmatively demonstrate that no reasonable trier of fact could find other than for the moving party. On an issue for which the opposing party will have the burden of proof at trial, however, the moving party need only point out “that there is an absence of evidence to support the nonmov-ing party’s case.” Id. at 325, 106 S.Ct. 2548.

Once the moving party meets its initial burden, the nonmoving party must go beyond the pleadings and, by its own affidavits or discovery, set forth specific facts showing that there is a genuine issue for trial. Fed. R. Civ. P. 56. The Court is concerned only with disputes over material facts and “factual disputes that are irrelevant or unnecessary will not be counted.” Anderson, 477 U.S. at 248, 106 S.Ct. 2505. It is not the task of the district court to scour the record in search of a genuine issue of triable fact. Keenan v. Allan, 91 F.3d 1275, 1279 (9th Cir.1996). The non-moving party has the burden of identifying with reasonable particularity the evidence that precludes summary judgment. Id. If the nonmoving party fails to make this showing, “[t]he moving party is ‘entitled to a judgment as a matter of law.’ ” Celotex, 477 U.S. at 323, 106 S.Ct. 2548.

The current version of Rule 56 changed the federal summary judgment process by authorizing the Court to grant what is sometimes called partial summary judgment to dispose of less than the entire case and even just portions of a claim or defense. See Fed. R. Civ. P.

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Bluebook (online)
133 F. Supp. 3d 1228, 25 Wage & Hour Cas.2d (BNA) 756, 2015 U.S. Dist. LEXIS 129539, 2015 WL 5654853, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ochoa-v-mcdonalds-corp-cand-2015.