1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 MONIQUE TIRADO, on behalf of herself Case No. 1:21-cv-00636-JLT-SKO and the Class members, 12 ORDER DENYING DEFENDANTS’ Plaintiff, MOTION TO DISMISS WITHOUT 13 v. PREJUDICE AND GRANTING DEFENDANTS’ ALTERNATIVE MOTION 14 VICTORIA’S SECRET STORES, LLC; L TO STAY ALL PROCEEDINGS BRANDS, INC., 15 (Doc. 10) Defendants. 16 17 On March 15, 2021, Monique Tirado initiated this action, on behalf of herself and 18 similarly situated employees, against her former employers, Victoria’s Secret Stores, LLC and L 19 Brands, Inc. (Doc. 1.) Tirado’s claims raise various violations of California’s Labor Code, 20 resulting from Victoria’s Secret’s failure to fully compensate employees for the time spent 21 undergoing temperature screenings prior to their shifts. (Id.) On June 16, 2021, Victoria’s Secret 22 filed a motion to dismiss or to stay all proceedings as duplicative of four previously filed class 23 actions against Victoria’s Secret which assert similar causes of action. (Doc. 10.) For the reasons 24 set forth below, the Court DENIES WITHOUT PREJUDICE Victoria’s Secret’s motion to 25 dismiss but GRANTS the motion to stay the action. 26 I. BACKGROUND 27 Tirado’s claims arise from the imposition of required temperature checks, a policy which 28 Victoria’s Secret began in response to the COVID-19 pandemic. (Doc. 1 at 2, ¶ 1.) Tirado claims 1 that the policy required employees to spend approximately five minutes before each shift 2 undergoing temperature screenings while off-the-clock and without compensation. (Id. at 4, ¶ 17.) 3 Tirado alleges that Victoria’s Secret implemented the temperature screening protocol on 4 approximately March 4, 2020, across all its facilities in California. (Id. at 4-5, ¶¶ 17-19.) The 5 complaint sets forth five causes of action each premised on Victoria’s Secret’s temperature 6 screening protocol: (1) failure to pay for all hours worked under California Labor Code § 204; (2) 7 failure to pay minimum wage and liquidated damages under Labor Code §§ 1182.11, 1182.12, 8 1194, 1197, and 1197.1; (3) waiting time penalties under Labor Code §§ 201-203; (4) failure to 9 provide timely and accurate itemized wage statements under Labor Code §§ 201-203; and (5) 10 unlawful business practices under California Business and Professions Code §§ 17200. (Id. at 1.) 11 Tirado seeks to represent a proposed class defined as: “All current and former hourly, non-exempt 12 workers employed at any Victoria’s Secret store throughout California during the time period 13 starting March 4, 2020 until resolution of this action.” (Id. at 6, ¶ 31.) In its motion to dismiss, 14 Victoria’s Secret contends that Tirado’s claims duplicate four putative class actions previously 15 filed in California. 16 A. Previously Filed Putative Class Actions 17 1. The Ochoa Action 18 On March 14, 2017, Elizabeth Ochoa, a former employee of Victoria’s Secret, filed a first 19 amended complaint in the Superior Court of California, Alameda County. (Doc. 11 at 106.) Her 20 claims include: (1) failure to pay wages for all time worked at minimum wage in violation of 21 Labor Code §§ 1194 and 1197; (2) failure to pay proper overtime under Labor Code §§ 510, 22 1194, and 1198; (3) failure to authorize or permit meal periods in violation of Labor Code §§ 512 23 and 226.7; (4) failure to authorize or permit rest periods in violation of Labor Code § 226.7; (5) 24 failure to provide complete and accurate wage statements in violation of Labor Code § 226; (6) 25 failure to timely pay all earned wages and final paychecks in violation of Labor Code §§ 201, 26 202, and 203; (7) unfair business practices in violation of Business and Professions Code 27 § 17200, et seq.; (8) civil penalties pursuant to PAGA, Labor Code § 2698, et seq. (Id. at 106-07.) 28 Ochoa’s claims for failure to compensate employees at minimum wage for all time 1 worked arise from Victoria’s Secret’s policy of that required employees to arrive approximately 2 fifteen minutes prior to the start of their shift to “arrange the stores before they opened to the 3 public.” (Doc. 11 at 112.) The complaint separately defines subclasses for each claim. (Id. at 4 118.) For the minimum wage class, the proposed class includes all current and former non- 5 exempt California employees of Victoria’s Secret within “within the four years prior to the filing 6 of the initial complaint in this action and through the date notice is mailed to a certified class” 7 who did not receive full minimum wage compensation. (Id.) 8 The Ochoa action was stayed pending the outcome of another class actions suit filed 9 against Victoria’s Secret (Mayra Casas v. Victoria’s Secret Stores, LLC, No. 14-cv-6412- 10 GW(VBXx) (C.D. Cal.)). (Doc. 10 at 11.) The parties reached a settlement in Casas that resolved 11 most of the claims in Ochoa. (Doc. 11 at 207.) In Casa, the claims included “failure to pay 12 reporting time on regularly schedule shifts”; “failure to pay reporting time on ‘call-in’ shifts”; and 13 “failure to pay for all time worked.” (Id. at 11.) At the time Victoria’s Secret filed its motion to 14 dismiss Tirado’s claims, it had reached a settlement in principle with the remaining claims in 15 Ochoa. (Doc. 10 at 12.) On September 13, 2022, the superior court issued a preliminary approval 16 of the settlement agreement. See Joint Status Report at 3, Lee v. Victoria’s Secret Stores LLC, 17 8:19-cv-01625-DOC (KESx) (C.D. Cal. Dec. 22, 2022), ECF No. 27. 18 2. The Lee Action 19 On May 28, 2019, Shauntese Lee initiated a putative class action against Victoria’s Secret 20 in the Superior Court of California, Orange County. (Doc. 11 at 251.) Victoria’s Secret removed 21 the action to the Central District of California. (Id. at 273.) Lee’s complaint included a claim for 22 failure to pay wages, including overtime, under Labor Code §§ 510 and 1194. (Id. at 251.) Lee 23 asserted claims for unpaid wages because store managers required employees to start their shifts 24 early due to high customer volume or short staff periods; Victoria’s Secret used an unlawful 25 rounding policy; and it failed to pay the required extra hour worked for interrupted rest periods. 26 (Id. at 258-60.) Lee’s proposed class included all non-exempt employees in California within four 27 years prior to filing the complaint until resolution of the action. (Id. at 254.) The parties stipulated 28 to stay the action pending conclusion of the Ochoa action. (Id. at 282-83.) 1 3. The Cortes Action 2 On September 27, 2019, Elia Cortes initiated a putative class action against Victoria’s 3 Secret raising similar causes of action as in Ochoa and Lee. (Doc. 11 at 321.) Victoria’s Secret 4 removed the case to federal court. Notice of Removal, Cortes v. Victoria Secret Stores, LLC, 5 5:19-cv-07639-EJD (N.D. Cal. Nov. 20, 2019), ECF No. 1. Cortes alleged that Victoria’s Secret 6 required employees to work during their rest breaks and to undergo a bag check before leaving, 7 resulting in unpaid wages. (Doc. 11 at 325-26.) Cortes’s proposed class includes all California 8 non-exempt employees, who suffered the asserted labor code violations, within four years prior to 9 filing of the complaint until judgment is entered. (Id. at 323.) Over Cortes’s objections, the 10 Central District of California entered a stay pending the final disposition of the Lee action. Cortes 11 v. Victoria Secret Stores, LLC, 2020 WL 1139657 (N.D. Cal. Mar. 9, 2020). 12 4. The Velazquez Action 13 On February 24, 2020, Monica Velazquez and Crystal Fregoso initiated a putative class 14 action in the Superior Court of California, Los Angeles County. (Doc. 11 at 342.) Asserting 15 similar claims as in Ochoa, Lee, and Cortes, the plaintiffs alleged that Victoria’s Secret subjected 16 employees to bag checks and security screenings after they clocked out and required employees 17 to wait after their shift for all employees to leave and set store alarms. (Doc. 11 at 343.) The 18 proposed class included all California non-exempt employees from August 12, 2017 through the 19 filing of the certified class notice. (Id. at 355-56.) Victoria’s Secret removed the case to federal 20 court and moved to stay the action. Notice of Removal, Velazquez v. L Brands, Inc., 2:20-cv- 21 03521-DOC-KES (C.D. Cal. Apr. 16, 2020), ECF No. 1. The court granted the stay, over 22 plaintiffs’ objections. (Doc. 11 at 413-21.) On January 20, 2023, the parties filed a stipulation to 23 dismiss. Stipulated Dismissal, Velazquez, 2:20-cv-03521-DOC-KES, ECF No. 26. 24 B. Status Update 25 Because the Ochoa action reached preliminary approval of the class settlement since 26 Tirado and Victoria’s Secret filed their briefing for this motion, the Court requested the parties 27 provide a status update regarding the Ochoa settlement and whether it covers the class claims 28 asserted by Tirado. (Doc. 32.) Tirado alleges that the Ochoa court required the parties to amend 1 the settlement agreement “so that the release of class claims would specify that it is limited to 2 claims based on facts alleged in the operative complaint.” (Doc. 34 at 3-4 (emphasis omitted).) 3 Victoria’s Secret alleges the Ochoa settlement releases class claims from January 3, 2013 through 4 May 26, 2021. (Id. at 2.) Although the parties did not submit the precise settlement class 5 definition or proposed agreement, they agree the scope of the Ochoa release includes only claims 6 that were asserted or that could have been asserted in the operative second amended complaint. 7 (Id. at 2-4.) Tirado and the named plaintiff in the Lee action opted out of the Ochoa settlement. 8 (Id. at 2-5.) With respect to whether the settlement covers Tirado’s class claims, the parties 9 generally maintain the same arguments asserted in their original briefing. (Id.) 10 II. EVIDENTIARY ISSUES 11 With its motion to dismiss or stay, Victoria’s Secret filed a request for judicial notice of 12 fifteen court filings from the Casas, Ochoa, Lee, Cortes, and Velazquez lawsuits. (Doc. 11.) 13 Tirado did not oppose the request for judicial notice. In general, courts “may not consider any 14 material beyond the pleadings in ruling on a Rule 12(b)(6) motion.” Lee v. City of Los Angeles, 15 250 F.3d 668, 688 (9th Cir. 2001). Parties may introduce evidence outside the pleadings under 16 two exceptions: “the incorporation-by-reference doctrine and judicial notice under Federal Rule 17 of Evidence 201.” Khoja v. Orexigen Therapeutics, Inc., 899 F.3d 988, 998 (9th Cir. 2018). 18 Under Rule 201, a court may take judicial notice of “a fact that is not subject to reasonable 19 dispute” because it is generally known or “can be accurately and readily determined” from 20 indisputably reliable sources. Fed. R. Evid. 201. “Courts have consistently held that courts may 21 take judicial notice of documents filed in other court proceedings.” NuCal Foods, Inc. v. Quality 22 Egg LLC, 887 F. Supp. 2d 977, 984-85 (E.D. Cal. 2012) (taking judicial notice of documents filed 23 in related Iowa state court proceedings); see Schulze v. FBI, 2010 WL 2902518, at *1 (E.D. Cal. 24 July 22, 2010) (quoting United States v. Black, 482 F.3d 1035, 1041 (9th Cir.2007) (“A federal 25 court may ‘take notice of proceedings in other courts, both within and without the federal judicial 26 system, if those proceedings have a direct relation to matters at issue.’”). Though the Court does 27 not accept the representations stated within the court filings as true, it may take notice of the fact 28 those representations were made. Accordingly, the request for judicial notice is GRANTED. 1 III. DISCUSSION 2 Victoria’s Secret seeks a motion to dismiss or stay Tirado’s claims based upon the first-to- 3 file rule, the Colorado River doctrine, and the Court’s inherent authority to control the cases on 4 its docket. (Doc. 10 at 9-10.) The Court addresses each in turn. 5 C. First-to-File Rule 6 Victoria’s Secret argues Tirado’s claims should be dismissed or stayed under the first-to- 7 file rule in light of the previously filed Lee, Cortes, and Velasquez actions. (Doc. 10 at 16.) The 8 first-to-file rule allows a district court to stay proceedings or dismiss a case “if a similar case with 9 substantially similar issues and parties was previously filed in another district court.” Kohn L. 10 Grp., Inc. v. Auto Parts Mfg. Miss., Inc., 787 F.3d 1237, 1239 (9th Cir. 2015); Pacesetter Sys., 11 Inc. v. Medtronic, Inc., 678 F.2d 93, 94-95 (9th Cir. 1982). The first-to-file rule “serve[s] the 12 purpose of promoting efficiency well and should not be disregarded lightly.” Alltrade, Inc. v. 13 Uniweld Prods., Inc., 946 F.2d 622, 625 (9th Cir. 1991). “The doctrine is designed to avoid 14 placing an unnecessary burden on the federal judiciary, and to avoid the embarrassment of 15 conflicting judgments.” Church of Scientology of Cali. v. U.S. Dep’t. of the Army, 611 F.2d 738, 16 750 (9th Cir. 1980). Though the rule is not applied mechanically, courts typically analyze three 17 factors: chronology of the lawsuits, similarity of the parties, and similarity of the issues. Kohn, 18 787 F.3d at 1240. 19 “The most basic aspect of the first-to-file rule is that it is discretionary; ‘an ample degree 20 of discretion, appropriate for disciplined and experienced judges, must be left to the lower 21 courts.’” Alltade, 946 F.2d at 628 ((quoting Kerotest Mfg. Co. v. C-O-Two Fire Equip. Co., 342 22 U.S. 180, 183-84 (1952)). When a court finds the rule to be applicable, the court has the power to 23 transfer, stay, or dismiss the case. Id. at 623. However, the court has discretion to disregard the 24 rule in the interests of equity. Id. at 628. 25 1. Chronology of the Actions 26 The parties do not dispute that the Lee, Cortes, and Velazquez actions were filed before 27 Tirado filed her complaint. The first factor, therefore, weighs in favor of application of the rule. 28 See De La Cruz v. Target Corp., 2018 WL 3817950, at *2 (S.D. Cal. Aug. 8, 2018) (“The first 1 factor, chronology of the lawsuits, simply requires that the case in question was filed later in 2 time.” (internal quotations omitted)). 3 2. Similarity of the Parties 4 The second element of the first-to-file rule evaluates the similarity of the parties. In the 5 context of class actions, courts typically examine the similarity among the proposed classes rather 6 than the named plaintiffs. Adoma v. Univ. of Phoenix, Inc., 711 F. Supp. 2d 1142, 1148 (E.D. Cal. 7 2010); see also Red v. Unilever U.S., Inc., 2010 WL 11515197, at *4 (C.D. Cal. Jan. 25, 2010) 8 (collecting cases). When the scope of the proposed classes includes “at least some of the same 9 individuals,” courts often find this element satisfied. Wallerstein v. Dole Fresh Vegetables, Inc., 10 967 F. Supp. 2d 1289, 1296 (N.D. Cal. 2013); Riffel v. Regents of the Univ. of Cal., 2019 WL 11 5978784, at *4 (C.D. Cal. Nov. 12, 2019) (finding sufficiently similar parties where “some of the 12 members of the proposed class in Riffel . . . would fall within the proposed [first-filed] class”). 13 The named plaintiff’s ability to opt in to the first-filed class further demonstrates the similarity of 14 the two classes. See Adoma, 711 F. Supp. 2d at 1148. 15 Victoria’s Secret argues that Tirado’s proposed class is “entirely subsumed within the 16 prior-filed cases.” (Doc. 16 at 6.) The prior actions have a similarly defined class because they 17 seek to represent all non-exempt employees of Victoria’s Secret in California. (Doc. 11 at 118, 18 254, 323, 355-56.) Tirado’s proposed class likewise includes “[a]ll current and former hourly, 19 non-exempt workers employed at any Victoria’s Secret store throughout California.” (Doc. 1 at 6, 20 ¶ 31.) Despite the similarities, Tirado argues the prior actions’ classes are not substantially similar 21 because none of plaintiffs in the prior actions can represent Tirado and her claims. (Doc. 15 at 18- 22 19.) Because Tirado’s claims arise from a policy instituted to combat the COVID-19 pandemic, 23 which started after each of the prior actions were filed, she contends the prior plaintiffs lack 24 standing to bring Tirado’s claims because they left Victoria’s Secret prior to the institution of this 25 policy. (Id. at 15-16); see also In re First Capital Holdings Corp. Fin. Prods. Sec. Litig., 33 F.3d 26 29, 30 (9th Cir. 1994) (holding only “an aggrieved class member” has standing). 27 Under the similarity of the parties, the inclusion of least some members of Tirado’s class 28 in the prior proposed classes sufficiently satisfies the rule. Tirado’s proposed class includes 1 former and current non-exempt employees starting on March 4, 2020 until the resolution of this 2 action.1 (Doc. 1 at 6, ¶ 31.) Tirado does not limit the definition of her class to those employees 3 who underwent temperature screenings. (Id.) Therefore, the proposed class in Lee contains at 4 least some cross over of putative class members. The Lee class includes former and current non- 5 exempt employees within four years prior to filing the complaint until the resolution of the action. 6 (Doc. 11 at 254.) Because the Lee action has not yet resolved, at least some overlap exists among 7 the non-exempt California employees that may recover from Lee’s claims with the employees 8 that may recover from Tirado’s claims. The proposed class in Cortes likewise has an overlapping 9 timeline with Tirado’s proposed class.2 (Doc. 11 at 254, 323.) Accordingly, the Court finds this 10 factor also weighs in favor of application of the rule. 11 3. Similarity of the Issues 12 Victoria’s Secret maintains that the prior actions, Lee, Cortes, and Velazquez, involve 13 substantially similar issues as Tirado’s case because they contain the same causes of action under 14 the California Labor Code and the Business and Professions Code. (Doc. 10 at 17-18.) Tirado, on 15 the other hand, argues that the factual basis giving rise to each of the causes of action differs, 16 rendering the issues not substantially similar. (Doc. 15 at 19-20.) The parties’ dispute turns on the 17 degree of similarity required by the first-to-file rule. The rule does not require the issues to be 18 identical, but the issues must be “substantially similar” and must have “substantial overlap” 19 between the suits. Kohn, 787 F.3d at 1240-41. A substantial overlap exists where the cases 20 involve the same “central questions.” Pacesetter, 678 F.2d at 95. 21 In Victoria’s Secret’s view, the comparison occurs at the cause of action level. (Doc. 10 at 22 18.) Victoria’s Secret argues that the prior actions similarly question whether Victoria’s Secret 23 failed to fully compensate employees for time spent working prior to their shifts. (Doc. 16 at 7-8.) 24 Victoria’s Secret relies upon Morrison v. CRST Van Expedited Inc., to show that overlap in 25 causes of action suffices and an additional claim does not necessarily negate substantial similarity 26 27 1 Although the Court agrees with Tirado that a lack of standing may have precluded the prior plaintiffs from asserting Tirado’s claims, this argument relates more to the similarity of issues factor. 28 2 The Court does not evaluate the Velazquez action’s proposed class or the similarity of its issues because the parties 1 of the issues. 2010 WL 11519596, at *3 (C.D. Cal Aug. 5, 2010); (Doc. 10 at 17-18.) However, to 2 reach its conclusion that substantial overlap existed, the Morrison court did not merely compare 3 the causes of action asserted but also considered whether the second plaintiff’s theories of 4 liability “rest[ed] upon the same factual allegations.” Morrison, 2010 WL 11519596, at *3 5 (emphasis added). Substantial similarity of the issues requires more than simply a comparison of 6 the causes of action; rather the cases must share similar factual underpinnings of those claims. See 7 e.g., Espineli v. Toyotal Motor Sales U.S.A., Inc., 2018 WL 1569570, at **1-2 (E.D. Cal. Mar. 30, 8 2018) (finding insufficient overlap where both cases alleged design defect due to use of soy-based 9 wiring but the first case alleged problems with the wiring more broadly and did not specifically 10 allege problems in the engine control wiring harness); see also Peak v. Green Tree Fin. Servicing 11 Corp., 2000 WL 973685, at *2 (N.D. Cal. July 7, 2000) (finding substantial similarity of the 12 issues where the both sets of claims arose from the same “allegedly offending conduct”). 13 To support its interpretation of the issue similarity factor, Victoria’s Secret also relies on 14 the Cortes court’s decision to stay the case pending the resolution in the Lee and Ochoa actions. 15 (Doc. 10 at 18.) It contends that Cortes reached its decision because of the similarity in claims 16 asserted and remedies sought. (Id.; Doc. 16 at 5.) However, the Cortes court not only considered 17 the similarity in the causes of action, but also evaluated the factual basis of the claims. Cortes, 18 2020 WL 1139657, at *4. In Cortes, the plaintiff asserts a claim for unpaid rest periods because 19 employees had to keep their walkie-talkies on during breaks. Id. The Lee complaint states a claim 20 under the same labor code violation, based on the same walkie-talkie policy. Id. The court 21 concluded substantial overlap existed in the unpaid rest period claims. Id. However, the court also 22 recognized that Cortes raised a separate, distinct issue by claiming unpaid wages for the time 23 employees spent undergoing security bag checks. (Id.) Given the substantial factual overlap of 24 Cortes’s and Lee’s other claims, the Court determined a stay under the first-to-file rule was 25 appropriate but refused to dismiss the case because “the bag check claim is not likely to be 26 resolved in the Lee action.”3 (Id.) 27
28 3 Likewise in Velazquez, the court evaluated the factual basis giving rise to the labor code violations. (Doc. 11 at 1 Similarly, Tirado’s unpaid wages claims assert a different factual theory for liability not 2 alleged in the prior actions. Tirado’s claims arise from the temperature screening policy 3 Victoria’s Secret implemented in response to the COVID-19 pandemic. (Doc. 1 at 2, ¶ 1.) Each of 4 the prior actions against Victoria’s Secret were initiated before the pandemic began, and 5 therefore, the complaints do not include claims for unpaid wages relating to the temperature 6 screening policy. On the other hand, because it is likely that security bag checks would have 7 occurred at the same time as the temperature checks, this case poses a likelihood of significant 8 overlap with the Cortes case. Melendras v. Arpaio, 784 F.3d 1254, 1262 (9th Cir. 2015) 9 (“[W]hether [representative parties] may be allowed to present claims on behalf of others who 10 have similar, but not identical, interests depends not on standing, but on an assessment of 11 typicality and adequacy of representation.”); see also McGhee v. Tesoro Refining & Mktg. Co. 12 LLC, 440 F. Supp. 3d 1062, 1072 (N.D. Cal. 2020) (dismissing named plaintiff’s waiting time 13 penalties claim “to the extent that is relies on an injury that he did not himself suffer”). Because 14 resolution of the prior actions against Victoria’s Secret would likely resolve Tirado’s claims, the 15 issues present substantial overlap. See Swangler v. Cherne Contracting Corp., 2021 WL 16 6332532, at *3 (N.D. Cal. Jan. 22, 2021) (finding substantial overlap of issues where both 17 plaintiffs brought unpaid wages claims to recover time spent “to complete a check-in process that 18 was ‘off-the-clock’ and unpaid and to be at their place of work at the beginning of their shift”). 19 Victoria’s Secret raises an additional argument to demonstrate substantial similarity of the 20 issues.4 It argues that Tirado’s claims under Labor Code § 226 for inaccurate wage statements and 21 § 203 for payment of all wages at termination overlap with Lee, Cortes, and Velazquez and this 22 duplication mandates application of the first-to-file rule. (Doc. 16 at 8.) The penalties stemming 23 from § 226 accrue per paid period in which a violation occurs, not for each error in wages 24 25 off-the-clock security checks and closing procedures. Id. Velazquez’s claims for unpaid overtime and failure to 26 provide meal and rest periods rested on the same security bag check policy. Id. 4 Arguably, the Court should disregard Victoria’s Secret’s argument because it waited to raise this until its reply. 27 United States v. Gianelli, 543 F.3d 1178, 1184 n.6 (9th Cir. 2008) (“[A]rguments raised for the first time in a reply brief are generally considered waived.”). Though arguments raised for the first time in the reply brief deprive the 28 non-movant of the opportunity to respond, Victoria’s Secret’s argument does not, standing alone, form the basis of 1 miscalculated on the statement. Cal. Lab. Code § 226(e)(1). Because the period of Tirado’s 2 proposed class shares at least some overlap with those proposed in Lee and Cortes, resolution of 3 the § 226 claims for overlapping pay periods would likely bar subsequent recovery by employees 4 for those pay periods as to prevent double recovery. With respect to the § 203 claims, settlements 5 in the earlier actions will likely include a release of those claims for unpaid wages at termination, 6 independent of the unpaid wages due to off-the-clock temperature screenings. See Dmuchowsky v. 7 Sky Chefs, Inc., 2018 WL 5886529 (N.D. Cal. Nov. 9, 2018) (finding payment to plaintiff from a 8 prior class settlement barred subsequent recover of his § 203 recovery, but not his separate unpaid 9 overtime claim). Even still, the Court finds the first-to-file rule does not warrant dismissal at this 10 time. There exists some, though slight, possibility that the facts will demonstrate that the Cortes 11 matter will not fully address the class Tirado seeks to represent. See Nat’l Public Radio, Inc. v. 12 U.S. Central Command, 570 F. Supp. 3d 866, 872 (S.D. Cal. 2021) (finding first-to-file rule does 13 not apply where the plaintiff in the second action “may not be fully remedied if the case is 14 dismissed or stayed due to the existence” of differences in the first action’s claims). Thus, the 15 totality of these factors and in the interest of equity and efficiency, as discussed below, weighs in 16 favor of staying these proceedings. 17 4. Equity and Efficiency 18 “The most basic aspect of the first-to-file rule is that it is discretionary.” Alltrade, 946 19 F.2d at 628. In Alltrade, the Ninth Circuit recognized the district court has “an ample degree of 20 discretion” and may “dispense with the first-filed principle for reasons of equity.” Id. (internal 21 quotations omitted); Adoma v. Univ. of Phoenix, Inc., 711 F. Supp. 2d 1142, 1149 (E.D. Cal. 22 2010) (“Even assuming the three requirements of the first-to-file rule are satisfied here, it does 23 not follow that application of the rule is appropriate.”). The primary purpose of the rule is to 24 promote comity, to preserve unnecessary waste of judicial resources, and to avoid conflicting 25 judgments. Church of Scientology of Cal. v. U.S. Dep’t of Army, 611 F.2d 738, 749-50 (9th Cir. 26 1979) overruled on other grounds by Animal Legal Def. Fund v. U.S. Food & Drug Admin., 836 27 F.3d 987 (9th Cir. 2016). 28 Granting a stay of Tirado’s claims promotes comity, efficiency, or equity. First, the risk of 1 some duplicative recovery by class members exists given the overlap among the prior actions’ 2 § 226 and § 203 claims and the off-the-clock claims. Tirado’s case has effectively been stayed for 3 approximately a year and half pending an outcome of this motion because of this District’s 4 considerable backlog. In that time, the Ochoa action reached the preliminary approval stage for 5 its class action settlement. Joint Status Report at 3, Lee, 8:19-cv-01625-DOC (KESx), ECF No. 6 27. However, the parties’ status report regarding Ochoa’s settlement provided little to no 7 additional details as to the scope of claims included in the settlement such that the Court can 8 discern what, if any, portion of Tirado’s class claims might have been released. (See Doc. 34.) 9 Moreover, the Lee and Cortes actions remain stayed pending final resolution of the Ochoa action. 10 (Id. at 4.) Once these actions reach a final resolution, the parties will be in a better position to 11 determine more precisely which of the alleged injuries have not yet been redressed. Accordingly, 12 the Court, in its discretion, finds the first-to-file rule warrants a stay of Tirado’s claims until 13 resolution of the Lee and Cortes actions. 14 D. Colorado River Doctrine 15 Victoria’s Secret also seeks dismissal under the Colorado River doctrine given the 16 pending Ochoa case in state court. (Doc. 10 at 18-23.) Although not an “abstention” doctrine, the 17 Colorado River doctrine functions similarly and allows a district court to stay or dismiss an action 18 in deference to parallel state proceedings. Nakash v. Marciano, 882 F.2d 1411, 1415 (9th Cir. 19 1989). The Colorado River doctrine applies only in “rare cases” and “only the clearest of 20 justifications will warrant dismissal.” United States v. State Water Res. Control Bd., 988 F.3d 21 1194, 1202 (9th Cir. 2021) (citing Colo. River Water Conservation Dist. v. United States, 424 22 U.S. 800, 819 (1976)). The court’s “task in [such] cases ... is not to find some substantial reason 23 for the exercise of federal jurisdiction by the district court; rather, the task is to ascertain whether 24 there exist ‘exceptional’ circumstances, the ‘clearest of justifications,’ that can suffice under 25 Colorado River to justify the surrender of that jurisdiction.” Moses H. Cone Mem’l Hosp. v. 26 Mercury Constr. Corp., 460 U.S. 1, 25-26 (1983) (emphasis in original). If “substantial doubt” 27 exists about whether the parallel state proceeding “will be an adequate vehicle for complete and 28 prompt resolution of the issues between the parties,” courts may not dismiss the case. Id. at 28. 1 The Ninth Circuit articulated eight factors to determine whether the Colorado River 2 doctrine applies: 3 (1) which court first assumed jurisdiction over any property at stake; (2) the inconvenience of the federal forum; (3) the desire to avoid piecemeal litigation; (4) 4 the order in which the forums obtained jurisdiction; (5) whether federal law or state law provides the rule of decision on the merits; (6) whether the state court 5 proceedings can adequately protect the rights of the federal litigants; (7) the desire to avoid forum shopping; and (8) whether the state court proceedings will resolve 6 all issues before the federal court. 7 R.R. St. & Co. v. Transp. Ins. Co., 656 F.3d 966, 978-79 (9th Cir. 2011). The factors do not 8 operate mechanically, and the weight given to each factor varies from case to case. State Water 9 Res., 988 F.3d at 1203. The eighth factor is considered a “preliminary matter.” R.R. St., 656 F.3d 10 at 979 n.9. The Ninth Circuit has “repeatedly emphasized that a Colorado River stay is 11 inappropriate when the state court proceedings will not resolve the entire case before the federal 12 court.” State Water Res., 988 F.3d at 1204 (emphasis added). 13 The eighth factor does not require “exact parallelism” between the issues but “substantial 14 similarity of claims is necessary.” Seneca Ins. Co. v. Strange Land, Inc., 862 F.3d 835, 845 (9th 15 Cir. 2017). As similarly discussed regarding similarity of the issues in the Lee and Cortes actions, 16 the Ochoa action does not have substantially similar claims because it will likely not resolve 17 Tirado’s unpaid wages claim arising from off-the-clock time spent undergoing temperature 18 checks. The Ochoa claims for unpaid wages arise from the failure to pay employees who worked 19 arranging stores prior to their shifts. (Doc. 11 at 112.) Ochoa, who left Victoria’s Secret in 20 February 2016, cannot serve as an adequate representative for atypical class claims based on 21 policies initiated after her employment ended. (Id. at 109.) Therefore, the Ochoa settlement, 22 which includes only claims asserted and those that could have been asserted, likely does not 23 resolve the temperature screening claims. The factual distinctions underlying the claims preclude 24 application of the Colorado River doctrine. Because the Court lacks “full confidence that the 25 parallel state proceeding will end the litigation,” it would be an abuse of discretion to dismiss 26 Tirado’s claims. See Intel Corp. v. Advanced Micro Devices, Inc., 12 F.3d 908, 913 (9th Cir. 27 1993). 28 /// 1 Victoria’s Secret’s arguments to the contrary are unpersuasive. First, Victoria’s Secret 2 argues that the Ochoa action will resolve the “vast majority” of issues in Tirado’s case. (Doc. 10 3 at 22.) Claim comparison in the Colorado River doctrine focuses on factual similarity rather than 4 similarity in the causes of action. For example, in Nakash v. Marciano, the Ninth Circuit held 5 substantial claim similarity existed because the disputes in both actions concerned the same 6 factual issues about the interactions between the parties, despite the prior case asserting state law 7 claims and the second case asserting federal law claims. 882 F.2d at 1416-17; see also Waterbury 8 v. Safeway Inc., 2006 WL 3147687, at *4 (N.D. Cal. Oct. 31, 2006) (finding substantial similarity 9 in the underlying issue in both actions which concerned whether Safeway misclassified its 10 employees, thus entitling them to overtime pay, even though causes of action were different). 11 Therefore, Victoria’s Secret’s arguments regarding the overlap in causes of action, without 12 explaining how the factual circumstances are similar, fail. 13 Second, Victoria’s Secret argues the eighth factor is met because res judicata will bar 14 Tirado’s claims after the Ochoa action reaches a settlement for the class claims. Under the 15 California res judicata doctrine,5 a final judgment on the merits bars a subsequent action by the 16 same parties, or parties in privity, “on the same cause of action.” Amin v. Khazindar, 112 Cal. 17 App. 4th 582, 589-90 (2003). “A ‘cause of action’ is defined by the ‘primary right’ theory.” Id. 18 The same primary right exists in both actions only “[i]f the matter was within the scope of the 19 action, related to the subject matter and relevant to the issues, so that it could have been raised, 20 the judgment is conclusive on it.” Id. (emphasis in original); Panos v. Great W. Packing Co., 21 21 Cal. 2d 636, 637 (1943) (“The doctrine of res judicata rests upon the ground that the party to be 22 affected, or some other with whom he is in privity, has litigated, or had an opportunity to litigate 23 the same matter in a former action in a court of competent jurisdiction.”). The Ochoa settlement 24 includes all claims that could have been raised in the operative complaint, mirroring the res 25 judicata standard. (See Doc. 34 at 2.) However, as previously explained, Ochoa may or may not 26 serve as an adequate representative of the temperature check claims because they do not share 27
28 5 When res judicata or claim preclusion is based on a state court judgment, state claim preclusion law governs. 1 typicality or commonality with Ochoa’s claims. See Melendres, 784 F.3d at 1262. Although both 2 Ochoa’s injuries and Tirado’s injuries generally arise from unpaid wages for work performed off- 3 the-clock, they may not share substantial similarity in the underlying employment practice and 4 policies that created those claims. Accordingly, distinct legal questions may exist about whether 5 the different policies each violate the California Labor Code. See Woodard v. Labrada, 2021 WL 6 4499184, at *32 (C.D. Cal. Aug. 31, 2021) (“Differences in applicable law among putative class 7 members can impede the generation of common answers.” (internal quotations and alterations 8 omitted)). Indeed, Victoria Secret maintains that Tirado’s claims lack merit because “it is an open 9 question as to whether government-mandated screenings would even be compensable.” (Doc. 34 10 at 3 n.1.) Thus, Tirado’s temperature screening claims likely could not have been raised in the 11 Ochoa complaint, demonstrating that the two cases assert different causes of action under the 12 primary right theory. 13 Victoria’s Secret’s arguments regarding the preference to avoid piecemeal litigation fail 14 for similar reasons. It argues that a stay will avoid piecemeal litigation because Tirado’s claims 15 “are a subset of the claims at issue in the Ochoa action.” (Doc. 10 at 20.) As explained above, 16 Tirado’s claims rest on a unique factual basis not presented in the Ochoa action. A determination 17 about whether the temperature screening protocol violates the California Labor Code’s 18 requirement to compensate employees for all time worked does not necessarily conflict with a 19 potentially contrary determination of the Ochoa claims challenging Victoria’s Secret’s policy of 20 requiring workers to arrange stores before their shifts begin. Travelers Indem. Co. v. Madonna, 21 914 F.2d 1364, 1369 (9th Cir. 1990) (“Piecemeal litigation occurs when different tribunals 22 consider the same issue, thereby duplicating efforts and possibly reaching different results.”). 23 Given that the Ochoa action may not resolve all of Tirado’s claims, the remaining factors 24 receive little weight. Victoria’s Secret’s arguments regarding the first to jurisdiction, choice of 25 law, inconvenience of federal forum, and adequacy of state court to protect federal rights6 cannot 26
27 6 Victoria’s Secret’s arguments about the adequacy of state court further fail because “[t]his factor, like choice of law, is more important when it weighs in favor of federal jurisdiction.” Travelers Indem., 914 F.2d at 1370 (internal 28 quotations omitted) (“In addition, it appears that this Circuit has not applied this factor against the exercise of federal 1 | justify application of the Colorado River doctrine where the eight factor is not met. State Water 2 | Res., 988 F.3d at 1208 (“[T]he eight factor is ‘dispositive’ in concluding that a stay of the entire 3 || case is not appropriate.” (citing Intel Corp., 12 F.3d at 913)). Accordingly, the Court finds the 4 | Colorado River doctrine does not warrant dismissal. Because the Court has already determined 5 | the first-to-file rule warrants a stay pending the Lee and Cortes actions, which are themselves 6 | stayed pending the Ochoa resolution, the Court need not address whether the Colorado River 7 | doctrine or the Court’s inherent authority provides an independent basis to issue a stay. 8 IV. ORDER 9 For the reasons set forth above, the Court ORDERS: 10 1. Victoria’s Secret’s request for judicial notice (Doc. 11) is GRANTED. 11 2. Victoria’s Secret’s motion to dismiss (Doc. 10) is DENIED WITHOUT 12 PREJUDICE. 13 3. Victoria’s Secret’s alternative motion to stay (Doc. 10) is GRANTED. 14 4. This action is administratively STAYED pending the resolution of Lee and Cortes. 15 The parties SHALL filed a joint status report every six months, starting September 16 1, 2023, or within thirty days of entry of judgment in both the Lee and Cortes 17 actions, whichever is sooner. 18 19 IT IS SO ORDERED. 29 | Dated: _March 9, 2023 Charis [Tourn TED STATES DISTRICT JUDGE 21 22 23 24 25 26 27 28 16