Ruelas v. County of Alameda

• Court: District Court, N.D. California
• Decided: February 20, 2025
• Docket: 4:19-cv-07637
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 ARMIDA RUELAS, et al., Case No. 19-cv-07637-JST

8 Plaintiffs, ORDER GRANTING IN PART AND 9 v. DENYING IN PART DEFENDANTS’ MOTIONS TO DISMISS 10 COUNTY OF ALAMEDA, et al., Re: ECF Nos. 161, 162 Defendants. 11

12 13 Before the Court is Defendants County of Alameda and Sheriff Yesenia Sanchez’s 14 (County Defendants) motion to dismiss, ECF No. 161, and Defendant Aramark Correctional 15 Services, LLC’s motion to dismiss, ECF No. 162. The Court will grant the County Defendants’ 16 motion and deny Aramark’s motion. 17 I. BACKGROUND 18 A. Factual History 19 For the purpose of deciding this motion, the Court accepts as true the following factual 20 allegations from Plaintiffs’ operative complaint, ECF No. 160. Knievel v. ESPN, 393 F.3d 1068, 21 1072 (9th Cir. 2005). Plaintiffs are or were “pre-trial detainees, detainees facing deportation, 22 [and] federal detainees” confined in Alameda County’s Santa Rita Jail. ECF No. 160 ¶ 1. Starting 23 as early as July 2015, Plaintiffs performed “industrial food preparation services and cleaning” for 24 Aramark, pursuant to a contract between Aramark and the County. Id. ¶¶ 1, 21. “Aramark is a 25 private, for-profit company that sells food prepared by prisoners to third parties” outside of 26 Alameda County. Id. 27 Aramark’s contract with Alameda County allows Aramark “to employ persons imprisoned 1 Santa Rita’s kitchen “and clean and sanitize the kitchen” after preparation. Id. ¶ 22. “Aramark 2 employees manage the kitchen operation and observe the Sheriff’s deputies’ supervision of the 3 prisoner-employees.” Id. Employees of Aramark “supervise the quality and amount of work that 4 prisoners accomplish” and “supervise prisoner-employee conduct and report misconduct to the 5 deputies for discipline.” Id. ¶ 23. Further, Aramark “establishes quotas for prisoners that dictate 6 how much work prisoners must complete before their shift ends” and “determines from its quotas 7 how many prisoner-employees are required to work and how many shifts are required.” Id. ¶ 24. 8 Plaintiffs allege that County Defendants may “remove [prisoner-employees’] eligibility to 9 work in the jail and subject them to disciplinary action” if Sheriff’s deputies are “displeased with 10 the quality or quantity of the work performed or the conduct of a prisoner-employee.” Id. ¶ 25. 11 “If Aramark is displeased with a prisoner-employee, it can tell the County that the prisoner- 12 employee may not return to work for Aramark.” Id. County Defendants and Aramark “arranged 13 to divide the workday so that male prisoners are assigned to longer, daytime shifts, and female 14 prisoners are assigned to shorter, nighttime shifts.” Id. ¶ 26. County Defendants “determine 15 which prisoners are eligible to work and place them in worker housing units,” and Aramark 16 “assigns prisoner-employees to their specific tasks.” Id. ¶ 27. “Sheriff’s deputies threaten 17 plaintiffs and other prisoner-employees of Aramark that if they refuse to work, they will receive 18 lengthier jail sentences or be sent to solitary confinement, where they would be confined to a small 19 cell for 22 to 24 hours a day.” Id. ¶ 30. The deputies “also threaten to terminate prisoners’ 20 employment if they need to take a sick day or are injured.” Id. Such threats are sometimes made 21 “in the presence of Aramark employees,” id. ¶ 31, and Aramark employees threaten “to report 22 [prisoner-employees] to the Sheriff’s deputies for punishment if they attempt to leave work early 23 due to illness or injury,” id. ¶ 32. 24 In late October 2019, male prisoner workers, including those working for Aramark, staged 25 a worker strike at Santa Rita “to advocate for improved conditions at the jail.” Id. ¶ 36. Plaintiffs 26 allege that, in response, Sheriff’s deputies forced female prisoners, including Plaintiffs Ruelas and 27 Mason, to cover the men’s shifts “so that Aramark could meet their quotas.” Id. Deputies 1 Id. 2 B. Procedural History 3 Plaintiffs filed the original complaint, ECF No. 1, on November 20, 2019, on behalf of 4 themselves and a class of individuals incarcerated in Santa Rita Jail who perform or performed 5 services for Aramark. Id. ¶ 41. Plaintiffs originally brought ten claims, including claims under 6 the Thirteenth Amendment, the Trafficking Victims Protection Act (“TVPA”), the Fourteenth 7 Amendment, the California Labor Code, California’s Unfair Competition Law (“UCL”), and 8 California’s Bane Act. Id. ¶¶ 67–108. 9 County Defendants and Aramark moved to dismiss. ECF Nos. 13, 23. On June 26, 2020, 10 this Court granted in part and denied in part those motions to dismiss. ECF No. 46. The Court 11 dismissed Plaintiffs’ (1) TVPA claim against Aramark; (2) Labor Code claim for failure to pay 12 wages, but only as it pertained to convicted plaintiffs; (3) Labor Code claims against County 13 Defendants for failure to pay minimum wage and overtime, but only as they pertained to convicted 14 Plaintiffs; (4) Labor Code claims against Aramark for failure to pay minimum wage and overtime; 15 (5) Equal Pay Act claim; (6) Bane Act claim, but only against Aramark; and (7) Plaintiffs 16 Mebrahtu, Mason, and Nunez-Romero’s Labor Code and Bane Act claims against County 17 Defendants. Id. at 25. All dismissals were with leave to amend except for the Labor Code claim 18 for failure to pay convicted Plaintiffs wages as well as Mebrahtu, Mason, and Nunez-Romero’s 19 claims. Id. 20 On July 10, 2020, Plaintiffs filed an amended complaint. ECF No. 48. Plaintiffs added 21 new plaintiffs, id. ¶¶ 1, 51, and reasserted nine of the ten claims from the original complaint, see 22 id. ¶¶ 74–110. County Defendants and Aramark again moved to dismiss. ECF Nos. 51, 52. On 23 June 24, 2021, the Court dismissed certain of Plaintiffs’ Labor Code claims but denied the motions 24 to dismiss with respect to Plaintiffs’ other claims. ECF No. 88. 25 On July 7, 2021, Defendants appealed to the Ninth Circuit, challenging this Court’s denial 26 of motions to dismiss the Labor Code claims for minimum and overtime wages. ECF Nos. 92, 27 145. The Ninth Circuit certified to the Supreme Court of California the question of whether 1 performing services in county jails for a for-profit company to supply meals within the county to 2 bring claims for minimum and overtime wages. See Ruelas v. County of Alameda, 15 Cal. 5th 968 3 (2024). The California Supreme Court concluded that Section 1194 did not authorize such claims, 4 id. at 563, and the Ninth Circuit accordingly reversed that part of this Court’s order on motions to 5 dismiss. ECF No. 152. 6 Plaintiffs filed the operative second amended complaint (“SAC”) on November 8, 2024. 7 ECF No. 160. The SAC reasserts claims under: (1) the Thirteenth Amendment; (2) the 8 Trafficking Victims Protection Act, 18 U.S.C. § 1589 (TVPA); (3) the equal protection clause of 9 the Fourteenth Amendment; (4) the due process clause of the Fourteenth Amendment; (5) 10 California’s Unfair Competition Law, Cal. Bus. & Prof. Code § 17200, et seq. (“UCL”); and (6) 11 California’s Bane Act, Cal. Civ. Code § 52.1. Id. ¶¶ 62–87. 12 The County Defendants now move to dismiss the Fourteenth Amendment claim, ECF No. 13 161, and Aramark moves to dismiss the UCL claim, ECF No. 162. Plaintiffs oppose both 14 motions, ECF Nos. 165, 166, and County Defendants and Aramark filed replies, ECF Nos. 167, 15 168. The Court held a hearing on February 20, 2025. 16 II. JURISDICTION 17 The Court has jurisdiction under 28 U.S.C. §§ 1331, 1367. 18 III. LEGAL STANDARD 19 To survive a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), a 20 complaint must contain “a short and plain statement of the claim showing that the pleader is 21 entitled to relief.” Fed. R. Civ. P. 8(a)(2). Dismissal “is appropriate only where the complaint 22 lacks a cognizable legal theory or sufficient facts to support a cognizable legal theory.” 23 Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008). “[A] complaint 24 must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible 25 on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 26 550 U.S. 544, 570 (2007)). Factual allegations need not be detailed, but the facts must be “enough 27 to raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555. 1 court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” 2 Ashcroft, 556 U.S. at 678. While this standard is not “akin to a ‘probability requirement’ . . . it 3 asks for more than a sheer possibility that a defendant has acted unlawfully.” Id. (quoting 4 Twombly, 550 U.S. at 556). “Where a complaint pleads facts that are ‘merely consistent with’ a 5 defendant’s liability, it ‘stops short of the line between possibility and plausibility of entitlement to 6 relief.’” Id. (quoting Twombly, 550 U.S. at 557). 7 In determining whether a plaintiff has met the plausibility requirement, a court must 8 “accept all factual allegations in the complaint as true and construe the pleadings in the light most 9 favorable” to the plaintiff. Knievel v. ESPN, 393 F.3d at 1072. In so doing, “a court may not look 10 beyond the complaint to a plaintiff’s moving papers, such as a memorandum in opposition to a 11 defendant’s motion to dismiss.” Schneider v. California Dep’t of Corr., 151 F.3d 1194, 1197 n.1 12 (9th Cir. 1998) (emphasis omitted). 13 IV. DISCUSSION 14 A. Fourteenth Amendment Due Process Claim 15 County Defendants move to dismiss the Fourteenth Amendment due process claim, 16 contending that the SAC fails to state a claim for due process violations in light of the California 17 Supreme Court’s holding in Ruelas v. County of Alameda, 15 Cal. 5th 968 (2024). The Court 18 agrees. 19 This Court denied Defendants’ last motion to dismiss Plaintiffs’ due process claim, holding 20 that non-convicted, incarcerated individuals had a property right to compensation under the 21 California Labor Code and that Plaintiffs sufficiently alleged that County Defendants denied 22 Plaintiffs due process of law by denying them pay without providing an opportunity to be heard. 23 ECF No. 88 at 29–30. But the California Supreme Court subsequently held that California Penal 24 Code section 4019.3, which sets a specific wage cap, applies to “all county inmates, including 25 pretrial detainees, working in the county jail.” Ruelas, 15 Cal. 5th at 974 (quoting Cal. Penal 26 Code § 4019.3). Thus, the Penal Code controls, and the Labor Code’s provisions regarding 27 minimum wage and overtime do not apply to non-convicted detainees. Ruelas at 979–81. 1 Recognizing this, Plaintiffs now argue that they hold an inherent property interest in their 2 labor, rather than a statutory property interest in wages owed. See ECF No. 165 at 4. This 3 argument fails for two reasons. As an initial matter, “[i]n determining the propriety of a Rule 4 12(b)(6) dismissal, a court may not look beyond the complaint to a plaintiff’s moving papers, such 5 as a memorandum in opposition to a defendant’s motion to dismiss.” Broam v. Bogan, 320 F.3d 6 1023, 1026 n.2 (9th Cir. 2003) (quoting Schneider v. Cal. Dep’t of Corr., 151 F.3d 1194, 1197 n.1 7 (9th Cir. 1998)) (emphasis in original). Plaintiffs’ SAC pleads a Fourteenth Amendment due 8 process claim premised only on a purported statutory right to wages. See ECF No. 160 ¶¶ 74–75 9 (“California, by statute, established the rights of all prisoners to receive compensation for work 10 performed for the benefit of a for profit company. In doing so, California established a property 11 right in the payment of wages that cannot be denied without due process of law.”) (emphasis 12 added). This is the same purported statutory right that the California Supreme Court considered— 13 and rejected—in Ruelas, 15 Cal. 5th at 971. The SAC does not plead a Fourteenth Amendment 14 due process claim grounded in a property right to labor established by “[e]xisting rules and 15 understandings, background principles of property, and state [criminal and tort] law,” as Plaintiffs 16 argue for the first time in their opposition. ECF No. 165 at 5–6. For this reason alone, the Court 17 need not consider Plaintiffs’ new argument. See Broam, 320 F.3d at 1026 n.2. 18 But even considering the argument on the merits, the Court cannot conclude that Plaintiffs 19 have a property interest in their labor in the absence of a statute establishing that interest. Indeed, 20 the Ninth Circuit has held the opposite. See Serra v. Lappin, 600 F.3d 1191 (9th Cir. 2010) (“The 21 Constitution does not provide prisoners any substantive entitlement to compensation for their 22 labor. . . . Plaintiffs have no constitutionally protected property interest because they lack a 23 statutory or otherwise established right to the . . . wages they demand.”) (internal citations 24 omitted). 25 Plaintiffs acknowledge that property interests “are created and their dimensions are defined 26 by existing rules or understandings that stem from an independent source such as state law.” ECF 27 No. 165 at 4 (quoting Board of Regents of State Colleges v. Roth, 408 U.S. 564, 577 (1972)). But 1 “[l]abor is property,” ECF No. 165 at 5 (quoting Slaughter-House Cases, 83 U.S. 36, 58 (1872)), 2 or that address entitlement to wages in inapposite situations. ECF No. 165 at 5–6 (citing Falk v. 3 Children’s Hosp. L.A., 237 Cal. App. 4th 1454, 1458–59 (2015) (hospital employee’s suit for 4 timely payment of wages); Dunlap v. Superior Ct., 142 Cal. App. 4th 330, 333 (2006) (bank 5 employees’ claim for unpaid wages)). But none of these authorities establish a property interest in 6 labor performed by individuals who are incarcerated or detained pretrial. Nor do Plaintiffs address 7 or attempt to distinguish Serra, which the Court sees as controlling authority regarding an 8 incarcerated individual’s right to a due process claim regarding compensation for labor. Because 9 the Due Process Clause protects only against deprivation of existing interests in life, liberty, or 10 property, and Plaintiffs “lack a statutory or otherwise established right to the [] wages they 11 demand,” the law compels the Court to hold that Plaintiffs have no valid due process claim. 12 Serra, 600 F.3d at 1195. Accordingly, it will dismiss that claim. Because amendment would be 13 futile, dismissal is without leave to amend. See Salameh v. Tarsadia Hotel, 726 F.3d 1124, 1133 14 (9th Cir. 2013). 15 B. UCL Claim 16 Aramark moves to dismiss Plaintiffs’ UCL claim, arguing that (1) the safe harbor doctrine 17 bars the claim, (2) Plaintiffs do not plausibly allege “unlawful” conduct, and (3) Plaintiffs do not 18 plausibly allege “unfair” conduct. The Court considers each argument in turn. 19 1. Safe Harbor Doctrine 20 The safe harbor doctrine “precludes plaintiffs from bringing claims based on ‘actions the 21 Legislature permits’” because “[i]f the Legislature has permitted certain conduct or considered a 22 situation and concluded no action should lie, courts may not override that determination.” Ebner 23 v. Fresh, Inc., 838 F.3d 958, 963 (9th Cir. 2016) (quoting Cel-Tech Commc’ns, Inc. v. L.A. 24 Cellular Tel. Co., 20 Cal. 4th 163, 184 (1999)). “Under the safe harbor doctrine, ‘[t]o forestall an 25 action under the unfair competition law, another provision must actually ‘bar’ the action or clearly 26 permit the conduct.’” Davis v. HSBC Bank Nev., N.A., 691 F.3d 1152, 1164 (9th Cir. 2012) (citing 27 Cel-Tech, 20 Cal. 4th at 183). “There is a difference between (1) not making an activity unlawful, 1 Aramark argues that the California Penal Code, which sets a cap on compensation for non- 2 convicted detainees in county jails, Cal. Penal Code § 4019.3, and does not provide minimum and 3 overtime wage protections to such detainees, reflects the Legislature’s “determination” that “no 4 action should lie” for claims regarding insufficient wages for labor performed by detainees. ECF 5 No. 162 at 9–10 (quoting Cel-Tech, 20 Cal. 4th at 182). Plaintiffs respond that although the Penal 6 Code may not prohibit Aramark’s failure to pay wages to non-convicted detainees, it does not act 7 to make the conduct lawful. ECF No. 166 at 8 (citing Cel-Tech, 20 Cal. 4th at 183 (“Penal Code 8 section 211, which defines robbery, does not make murder unlawful. Most assuredly, however, 9 that section does not also make murder lawful.”)). Moreover, Plaintiffs argue that their UCL 10 claim is based not only on Aramark’s failure to pay wages but also on its “coercive tactics on 11 prisoners to compel their uncompensated labor.” ECF No. 166 at 9. 12 The Court agrees with Plaintiffs. Aramark construes Plaintiffs’ UCL claim too narrowly. 13 The SAC alleges that non-convicted detainees “are coerced to work,” ECF No. 160 ¶ 30, that 14 Aramark employees “threaten[] to report them to the Sheriff’s deputies for punishment if they 15 attempt to leave work early due to illness or injury,” id. ¶ 32, and that such reports may result in 16 “lengthier jail sentences” or “solitary confinement” for detainees. Id. ¶ 30. Plaintiff’s UCL claim 17 incorporates by reference these allegations and alleges Aramark’s continuing “exploit[ation of] 18 incarcerated employees to gain market share.” Id. ¶ 83. Even if the California Penal Code 19 operated to “make lawful” the nonpayment of compensation to non-convicted detainees (a 20 conclusion the Court need not and does not make), the Penal Code does not make lawful the 21 threats, coercion, and exploitation that the SAC alleges. This is akin to the facts in McKay v. 22 Sazerac Co., No. 23-cv-00522-EMC, 2023 WL 3549515 (N.D. Cal. May 17, 2023), where the 23 plaintiff’s claims did “not turn solely on” elements of a product label that complied with federal 24 regulations but also on “the combination of the labeling and appearance” of the product, which 25 “create[d] confusion.” Id. at *4. So too here: the California Penal Code’s provision regarding 26 compensation to non-convicted detainees does not “clearly permit” Aramark’s failure to provide 27 compensation coupled with the threatening and coercive conduct alleged in the SAC. 1 UCL claim. 2 2. “Unlawful” Prong 3 Aramark next argues that Plaintiffs fail to plead a claim under the UCL’s “unlawful” prong 4 because the California Supreme Court held that Aramark’s failure to pay wages is not a violation 5 of the California Labor Code. ECF No. 162 at 10. Plaintiffs respond that its “unlawful” UCL 6 claim rests not only on its now-dismissed Labor Code claim but also on alleged violations of the 7 Trafficking Victims Protection Act, 18 U.S.C. § 1589 (“TVPA”), and the Bane Act, Cal. Civ. 8 Code § 52.1. ECF No. 166 at 10–11. 9 In its order on a previous round of motions to dismiss, the Court held that the TVPA claim 10 formed a sufficient predicate violation to state a UCL claim. ECF No. 88 at 31. The California 11 Supreme Court’s and Ninth Circuit’s subsequent rulings on the Labor Code claim do not disturb 12 the viability of Plaintiffs’ TVPA claim or its sufficiency as a predicate violation for Plaintiffs’ 13 UCL claim. For that reason, the Court declines to dismiss the “unlawful” prong of Plaintiffs’ 14 UCL claim. 15 3. “Unfair” Prong 16 Finally, Aramark argues that Plaintiffs fail to plead a claim under the UCL’s “unfair” 17 prong because “Plaintiffs offer no basis for the allegation that the ‘failure to pay wages’ is 18 ‘immoral, unethical, oppressive, unscrupulous, and substantially injurious.’” ECF No. 162 at 11 19 (quoting ECF No. 160 ¶ 85). 20 Again, Aramark’s cramped reading of the UCL claim is unpersuasive. As explained 21 above, Plaintiffs base their claims not only on the nonpayment of wages but also on forced labor 22 and coercive and threatening conduct. That alleged conduct “offends established public policy” as 23 reflected in the TVPA and Bane Act. See Rezner v. Bayerishe Hypo-Und Vereinsbank AG, No. C 24 06-02064 JW, 2011 WL 6329854, at *6 (N.D. Cal. Nov. 8, 2011) (finding that plaintiff 25 “adequately pleaded an unfair business practice under the UCL” where he “alleged numerous 26 instances of conduct by Defendants that . . . offend public policy, insofar as they were outright 27 unlawful”) (internal quotations omitted)). 1 3d 1016 (N.D. Cal. 2016), the court concluded that while “the labor practices” allegedly used to 2 || produce defendant’s chocolate bars “are immoral, there remains an important distinction between 3 || them and the actual harm for which [the plaintiff] seeks to recover, namely his purchase of Mars’s 4 || chocolate products absent any disclosure.” Jd. at *1027. Here, there is no such “distinction,” 5 because Plaintiffs seek to recover for the harm caused directly by the alleged labor practices 6 || themselves. 7 Accordingly, the Court will not dismiss the “unfair” prong of Plaintiffs’ UCL claim. 8 CONCLUSION 9 For the foregoing reasons, the Court grants County Defendants’ motion and dismisses 10 || Plaintiffs’ Fourteenth Amendment due process claim without leave to amend. The Court denies 11 Aramark’s motion to dismiss Plaintiffs’ UCL claim. a 12 IT IS SO ORDERED. % 13 || Dated: February 20, 2025 a

JON S. TIGA 15 nited States District Judge 16

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