Valenzuela v. Ruby J Farms LLC

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA

9 Robert A Valenzuela, No. CV-21-00442-TUC-JGZ

10 Plaintiff, ORDER AND JUDGMENT

11 v.

12 Ruby J Farms LLC, et al.,

13 Defendants. 14 15 Plaintiff Robert Valenzuela filed this action against Defendants Ruby J Farms LLC 16 (RJF) and Anthony and Norma Comella, alleging wage and overtime violations under the 17 Arizona Wage Act (AWA), Arizona Minimum Wage Act (AMWA), and Fair Labor 18 Standards Act (FLSA). (Doc. 1). RJF filed a counterclaim for conversion against 19 Valenzuela, alleging Valenzuela wrongfully took possession of RJF’s Rolex watch. 20 (Doc. 8 at 6–9.) Prior to trial, the parties stipulated to the Court determining the nature of 21 Valenzuela’s work relationship with Defendants. (Doc. 86-2.) The Court determined that 22 Valenzuela was an employee of RJF under the AWA and an employee of RJF and Anthony 23 Comella under the AMWA and FLSA. (Doc. 107 at 5–6.) 24 This action was tried before a jury from August 21 to 25, 2023. For the AWA claim, 25 the jury determined that RJF failed to pay Valenzuela amounts promised to him in breach 26 of the parties’ contract, the amount RJF failed to pay was $6,953.97, this entire amount 27 was compensation for Valenzuela’s services which Valenzuela had a reasonable 28 expectation to be paid, and RJF did not have a good-faith basis for withholding payment. 1 (Doc. 122.) For the AMWA claim, the jury determined that RJF and Comella failed to pay 2 Valenzuela at least $12.15 per hour for any hours worked after May 31, 2021, and that RJF 3 and Comella owed Valenzuela $6,366.60 in minimum wage. (Doc. 123.) For the FLSA 4 claim, the jury determined that RJF and Comella failed to pay Valenzuela 1.5 times his 5 regular rate for overtime hours worked and owed Valenzuela $2,223.45 in overtime pay. 6 (Doc. 124.) For the conversion counterclaim, the jury determined that RJF owned the Rolex 7 watch, Valenzuela knowingly and intentionally controlled the watch in a manner that 8 seriously interfered with RJF’s right to control it, and RJF suffered damages in the amount 9 of $15,000. (Doc. 125.) 10 The parties stipulated to the Court determining (if Valenzuela prevailed on his wage 11 claims) whether Valenzuela was entitled to treble damages or additional remedies. (Doc. 12 86-2 at 2, 4–5.) The parties also stipulated to the Court resolving post-trial Valenzuela’s 13 equitable defenses to RJF’s conversion counterclaim. (Id. at 5–6.) Pending before the Court 14 are Valenzuela’s Post-Trial Brief for Additional Remedies (Docs. 127, 132, 134) and 15 Valenzuela’s Motion for Additional Findings, Conclusions, and Judgment Regarding 16 Equitable Defenses to the Conversion Counterclaim (Docs. 128, 131, 133). The Court will 17 address each in turn. 18 I. Additional Remedies for Valenzuela’s Wage Claims 19 In his post-trial brief, Valenzuela requests the Court award treble damages and pre- 20 and post-judgment interest for the AWA and AMWA claims, and liquidated damages and 21 post-judgment interest for the FLSA claim. (Doc. 134 at 8–9.) Defendants raise two issues 22 with respect to Valenzuela’s requests: (1) whether the damages the jury awarded under the 23 AMWA and FLSA duplicated the damages awarded under the AWA; and (2) whether 24 Valenzuela is entitled to treble damages on $24,050 in compensation RJF paid to 25 Valenzuela during the litigation. (Doc. 132 at 1–2, 4–5, 7.) For the following reasons, the 26 Court will grant Valenzuela his requested relief and rule in his favor as to both issues. 27 // 28 // 1 A. Duplication of Damages 2 The jury plays a vital role in our civil justice system. Soto v. Sacco, 398 P.3d 90, 93 3 (Ariz. 2017). A trial court must neither substitute its judgment for the jury’s, id., nor 4 reweigh the evidence because the court feels other results are more reasonable, Tennant v. 5 Peoria & Pekin Union Ry. Co., 321 U.S. 29, 35 (1944). If a jury’s verdict is “within the 6 limits of the evidence,” the trial court should not reduce it. See In re Est. of Hanscome, 254 7 P.3d 397, 401 (Ariz. Ct. App. 2011); see also Kaffaga v. Est. of Steinbeck, 938 F.3d 1006, 8 1013 (9th Cir. 2019) (“We must avoid reversing a jury verdict for lack of evidence or 9 alleged double recovery if the verdict is capable of a ‘correct interpretation’ that is not 10 illegal, and if the verdict is not ‘hopelessly ambiguous.’”). 11 Defendants argue the Court should not enter judgment for the damages the jury 12 awarded under the AMWA and FLSA because those damages duplicate the damages the 13 jury awarded under the AWA. (Doc. 132 at 2.) Defendants argue that Jury Verdict Form 14 1, for the AWA claim, required the jury to state the “total amount of unpaid wages due 15 Valenzuela.” (Id. at 3.) The damages awarded by the jury for the AWA claim, argue 16 Defendants, represent all wages owed to Valenzuela under the parties’ commission 17 agreement, including any Yuma commissions, minimum wages, and overtime pay. (Id.) 18 Defendants thus contend the Court should not aggregate the damages awarded by the jury 19 for the AWA, AMWA, and FLSA claims. (Id. at 4.) Instead, Defendants ask the Court to 20 enter judgment in the amount of the highest single award and calculate liquidated damages 21 based only on that award. (See id.) 22 The jury’s damages award for Valenzuela’s AWA claim need not encompass the 23 damages for his other claims. This dispute turns on whether the jury included any 24 compensation for the Yuma project when calculating damages for the AWA claim— 25 compensation that would naturally offset any minimum wage owed to Valenzuela for his 26 work in Yuma. (Docs. 132 at 2; 134 at 4.) For example, in theory, the jury’s award of 27 $6,953.97 for the AWA claim could have consisted of only unpaid Yuma commissions. If 28 so, the damages for the AWA claim would encompass the $6,366.60 in minimum wage 1 damages, which the jury awarded Valenzuela for the summer he worked in Yuma. 2 Awarding both amounts, in this example, would result in a double recovery for Valenzuela. 3 But there is no conclusive evidence to establish which commissions from which projects 4 or time periods the jury included when calculating damages under the AWA. The parties’ 5 stipulated verdict forms did not request this finding and, accordingly, the jury did not 6 provide it. 7 Even so, the parties’ closing arguments and the jury’s findings suggest that the jury 8 did not include the Yuma commissions in the damages it awarded under the AWA. During 9 closing argument, Valenzuela argued that the jury should calculate minimum wage owed 10 based on his hours worked in Yuma and a minimum wage rate of $12.15 per hour, less any 11 compensation Defendants paid him for his work during the summer. The jury appeared to 12 agree and awarded Valenzuela minimum wage for the summer of 2021.1 The jury’s 13 decision to compensate Valenzuela $12.15 per hour for the entire summer in Yuma 14 suggests the jury could have determined that Defendants did not pay Valenzuela for any of 15 his work in Yuma and that the $30,000 Defendants did pay him during the summer was 16 actually compensation owed for past work. 17 Further, Valenzuela argued at closing that if the jury determined there was no 18 promise of compensation for the Yuma project, then it should use the minimum wage rate 19 as the regular rate for the purpose of calculating overtime pay. The jury apparently agreed 20 and found that Defendants owed Valenzuela overtime wages based on a time-and-a-half 21 multiplier of $12.15 per hour.2 The jury’s use of the minimum wage rate as Valenzuela’s 22 regular rate suggests the jury determined there was no promise as to compensation for the 23 Yuma project. The AWA verdict form, however, asked the jury to determine the amount 24 RJF promised to Valenzuela but failed to pay him. (See Doc. 122 at 2.) Taken together, it 25

26 1 The jury awarded Valenzuela $6,366.60 in minimum wage. (Doc. 123.) This amount, divided by $12.15, equals 524 hours worked, or roughly 40 hours a week for the 13-week 27 summer in Yuma.

28 2 The jury awarded Valenzuela overtime pay in the amount of $2,223.45, (Doc. 124), which equals $12.15 multiplied by 1.5 (an $18.225 overtime rate) multiplied by 122 hours. 1 is possible the jury reasonably determined there were no promised wages or commissions 2 for the Yuma project and thus excluded the Yuma project when calculating damages under 3 the AWA. If the jury excluded the Yuma project, then neither the minimum wage damages 4 nor the overtime damages duplicate the damages the jury awarded for the AWA claim.3 5 The cases Defendants cite are inapposite. In Esser, the plaintiff alleged wage claims 6 based on the defendants’ failure to pay wages for a discrete three-week period. Valenzuela 7 v. Esser, No. CV 22-01180-PHX-CDB, 2023 WL 2815548, at *7 (D. Ariz. Mar. 14, 2023), 8 report and recommendation adopted, No. CV 22-01180-PHX-CDB, 2023 WL 2814078 9 (D. Ariz. Apr. 6, 2023). Similarly, in Grabda and Sao, the plaintiffs alleged unpaid wages 10 from discrete, one-week periods. Grabda v. IMS Acquisition LLC, No. CV 20-00117-TUC- 11 MSA, 2020 WL 5544366, at *3 (D. Ariz. Sept. 16, 2020); Sao v. Pro-Tech Prod. Inc., No. 12 CV 19-05261-PHX-JJT, 2019 WL 6909566, at *1 (D. Ariz. Dec. 19, 2019). Unlike the 13 discrete work periods in Esser, Grabda, and Sao, Valenzuela had no single work period 14 relevant to all of his wage claims. The verdict forms for the AWA and FLSA claims did 15 not limit the jury’s damages calculations to any timeframe, (Docs. 122, 124), while the 16 verdict form for the AMWA claim limited the jury’s damages calculation to “hours worked 17 after May 21, 2021,” (Doc. 123). Valenzuela’s wage claims spanned nearly a year and the 18 relevant time periods for his work projects could—but did not need to—overlap. 19 For these reasons, no conclusive evidence demonstrates that the jury’s damages 20 awards provided Valenzuela with a double recovery. To be sure, the parties’ verdict forms 21 leave some uncertainty. Yet, if Defendants were concerned about the risk of double 22 recovery, they could have requested more detailed verdict forms and jury instructions. See 23 Maxwell v. Aetna Life Ins. Co., 143 Ariz. 205, 217, 693 P.2d 348, 360 (Ariz. Ct. App. 1984) 24 (“If [defendant] desired to minimize the risk of double recovery it could have requested the 25 judge to properly and clearly instruct the jury on what basis it could award damages.”). The 26 jury’s verdicts on each of Valenzuela’s wage claims were reasonable and “within the limits 27 3 If the jury excluded minimum wage damages from the summer in Yuma when calculating 28 the damages for the AWA claim, then it likely excluded any overtime wages based on hours Valenzuela worked at minimum wage. 1 of the evidence,” and thus should not be disturbed. See In re Est. of Hanscome, 254 P.3d 2 at 401. 3 B. Treble Damages for Compensation Paid During Litigation 4 On or about September 1, 2021, Valenzuela left his employment with RJF. (Cf. Doc. 5 107 at 4 (finding that RJF’s Yuma project ended around September 1, 2021).) On October 6 29, 2021, Valenzuela filed this action. (Doc. 1.) In May 2022, RJF made a payment to 7 Valenzuela in the amount of $24,050. (Docs. 127 at 4; 132 at 5–6.) At trial in August 2023, 8 the jury found that RJF owed Valenzuela an additional $6,953.97 in unpaid wages under 9 the AWA. (Doc. 122.) In his Motion, Valenzuela requests the Court award treble damages 10 on both the $24,050 RJF paid seven months into litigation and the $6,953.97 the jury 11 awarded at trial. (Doc. 127 at 4.) Arizona law provides, “If an employer, in violation of 12 [the AWA], fails to pay wages due any employee, the employee may recover in a civil 13 action against an employer or former employer an amount that is treble the amount of the 14 unpaid wages.” Ariz. Rev. Stat. § 23-355(A). The legislature included the treble damages 15 provision in the AWA to punish employers who force their employees to resort to the courts 16 in an unreasonable wage dispute. Wood v. Nw. Hosp., LLC, 473 P.3d 729, 739 (Ariz. Ct. 17 App. 2020). 18 RJF argues the Court should exercise its discretion by not awarding treble damages 19 because such an award “creates a perverse incentive to avoid attempts to resolve claims.” 20 (Doc. 132 at 5.) That is, RJF implies that an award of treble damages would penalize it for 21 attempting to settle this matter during litigation. In taking this position, RJF suggests that 22 it had only two choices: pay $24,050 in an attempt to resolve the parties’ dispute mid- 23 litigation or offer nothing and proceed with trial. The jury, however, determined that RJF 24 had no good-faith basis to withhold wages. (Doc. 122.) Therefore, each of RJF’s proposed 25 options involve an unreasonable delay in RJF’s payment of wages. RJF did not pay the 26 $24,050 until nearly seven months into litigation and the jury’s verdict arrived almost two 27 years after Valenzuela’s separation from RJF. 28 RJF did not have to choose between paying wages seven months late and two years 1 late. RJF had a third option: timely pay Valenzuela the wages it owed him. Had it selected 2 this option, there would have been no delay or cause for treble damages. Indeed, 3 Valenzuela and Comella testified at trial that Valenzuela agreed to resolve this dispute for 4 $20,000 when he left RJF on September 1, 2021. But RJF rejected his offer and chose to 5 withhold those wages from him for over seven months, compelling him to resort to 6 litigation. The Court will therefore award Valenzuela treble damages for the $24,050 7 payment and the $6,953.97 which the jury awarded at trial. See Wood, 473 P.3d at 739. 8 II. Equitable Defenses to the Conversion Counterclaim 9 At trial, the jury determined that RJF owned the Rolex watch and Valenzuela 10 knowingly and intentionally controlled the watch in a manner that seriously interfered with 11 RJF’s right to control it, causing RJF to suffer $15,000 in damages. (Doc. 125.) Valenzuela 12 requests, under Rule 52 or, alternatively, Rule 59(e) of the Federal Rules of Civil 13 Procedure, that the Court enter additional findings, conclusions, and judgment in his favor 14 as to RJF’s conversion counterclaim. (Doc. 128 at 3.) In support, Valenzuela advances two 15 equitable defenses: estoppel and waiver. (Id. at 3–4.) 16 For issues tried before the Court, the Court must find the facts and state its 17 conclusions of law separately. Fed. R. Civ. P. 52(a)(1). A party may also file a motion to 18 alter or amend a judgment no later than 28 days after the entry of judgment. Fed. R. Civ. 19 P. 59(e). This Order sets forth the Court’s findings of fact and conclusions of law. The 20 Court designates its findings of fact as “Findings” and its conclusions of law as 21 “Conclusions.” The Court bases its decision on all of the testimony and exhibits admitted 22 during trial and the Court’s evaluation of the witnesses’ credibility. For the following 23 reasons, the Court concludes that Valenzuela has not established the defenses of equitable 24 estoppel and waiver. The Court will therefore deny Valenzuela’s Motion for Judgment 25 under Rule 52 and Motion to Alter or Amend Judgment under Rule 59. 26 A. Findings 27 In January 2021, RJF allowed Valenzuela to possess its Rolex watch. In March 28 2021, Valenzuela made a $200 purchase for additional links for the watch wristband. In 1 October 2021, Comella asked Valenzuela to return RJF’s watch. At trial, the jury found 2 that RJF owned the watch and Valenzuela knowingly and intentionally controlled it in a 3 manner that seriously interfered with RJF’s right to control it.4 (Doc. 125.) 4 B. Conclusions 5 There are three elements of equitable estoppel: 6 (1) affirmative acts inconsistent with a claim afterwards relied upon; 7 (2) action by a party relying on such conduct; and 8 (3) injury to the party resulting from a repudiation of such conduct. 9 Tucson Elec. Power Co. v. Ariz. Dep’t of Revenue, 851 P.2d 132, 141 (Ariz. Ct. App. 1992). 10 Valenzuela argues that RJF committed affirmative acts inconsistent with its conversion 11 counterclaim and that he relied upon RJF’s acts to his own detriment. (Doc. 128 at 3.) More 12 specifically, Valenzuela argues that Comella gave him the watch without telling him it was 13 not a gift but a loan and did not ask for the watch back for nine months. (Id.) Valenzuela 14 also argues he relied on these actions and purchased $200 in additional links for the watch. 15 (Id.) In light of the factual findings, Valenzuela’s arguments are unpersuasive 16 Comella’s decision to wait nine months to request the return of the watch is not 17 inconsistent with his testimony that the watch was a loan. An owner of expensive 18 property—like a Rolex watch—does not necessarily forfeit his rights to the property by 19 waiting nine months to request its return. And given the value of the watch, which the jury 20 marked at $15,000, (Doc. 125), Valenzuela’s purchase of $200 links does not render this 21 decision inequitable. Valenzuela’s reliance on Comella’s actions and subsequent purchase 22 of links worth about 1% of the watch did not significantly and detrimentally change his 23 position. Similarly, to establish waiver, a party must present evidence of acts inconsistent 24 with an intent to assert its rights. Jones v. Cochise Cnty., 187 P.3d 97, 104 (Ariz. Ct. App. 25 26 4 To the extent Valenzuela asks the Court to alter or amend the jury’s finding on this factual 27 issue, the Court declines to do so because the jury’s factual determination was “within the limits of the evidence,” see In re Est. of Hanscome, 254 P.3d at 401, and the Court should 28 not reweigh evidence even if it feels other results are more reasonable, Tennant, 321 U.S. at 35. 1 2008). Valenzuela’s possession of the watch for nine months, as discussed above, is not 2 inconsistent with RJF’s asserted right to the watch. Valenzuela has thus not proven his 3 equitable defenses of estoppel or waiver. 4 III. Conclusion 5 Accordingly, 6 IT IS ORDERED that Valenzuela’s Request for Additional Remedies (Doc. 127) 7 is granted, consistent with this Order. Valenzuela’s Motion for Additional Findings, 8 Conclusions, and Judgment Regarding Equitable Defenses to Conversion Counterclaim 9 (Doc. 128) is denied, consistent with this Order. 10 IT IS FURTHER ORDERED entering judgment in favor of Valenzuela against 11 Defendants as stated below: 12 1. On his Arizona Wage Act Claim, Valenzuela shall take judgment against 13 Ruby J. Farms, LLC as follows: 14 a. $6,953.97 in unpaid commissions remaining due; 15 b. an additional $13,907.94 as treble damages on the 16 unpaid commissions remaining due; 17 c. an additional $48,100.00 as treble damages on the 18 $24,050 in commissions withheld in bad faith until May 19 2022; 20 d. pre-judgment interest of 10% per annum on the unpaid 21 commissions remaining due from September 20, 2021 22 to the date of entry of final judgment; and 23 e. post-judgment interest on all amounts awarded. 24 2. On his Minimum Wage Claim, Valenzuela shall take judgment against Ruby 25 J. Farms, LLC and Anthony and Norma Comella, husband and wife, as follows: 26 a. $6,366.60 in minimum wages due; 27 b. an additional $12,733.20 as treble damages; 28 c. pre-judgment interest of 10% per annum on the unpaid 1 minimum wages from September 20, 2021 to the date 2 of entry of final judgment; and 3 d. post-judgment interest on all amounts awarded. 4 3. On his Fair Labor Standards Act Claim, Valenzuela shall take judgment 5 against Ruby J. Farms, LLC and Anthony and Norma Comella, husband and wife, as 6 follows: 7 a. $2,223.45 in overtime compensation due; 8 b. an additional $2,223.45 as liquidated damages; and 9 c. post-judgment interest on all amounts awarded. 10 IT IS FURTHER ORDERED entering judgment in favor of Ruby J. Farms, LLC 11 against Robert Valenzuela on Ruby J. Farms, LLC’s conversion counterclaim in the 12 amount of $15,000.00. This amount is to be offset by Robert Valenzuela’s judgment 13 against Ruby J. Farms, LLC for his Arizona Wage Act claim.5 14 IT IS FURTHER ORDERED that any motion for an award of attorneys’ fees shall 15 be accompanied by an electronic spreadsheet, to be e-mailed to the Court and opposing 16 counsel, containing an itemized statement of legal services with all information required 17 by Local Rule 54.2(e)(1). This spreadsheet shall be organized with rows and columns and 18 shall automatically total the amount of fees requested so as to enable the Court to efficiently 19 review and recompute, if needed, the total amount of any award after disallowing any 20 individual billing entries. This spreadsheet does not relieve the moving party of its burden 21 under Local Rule 54.2(d) to attach all necessary supporting documentation to its 22 memorandum of points and authorities filed in support of its motion. A party opposing a 23 motion for attorneys’ fees shall e-mail the Court and opposing counsel a copy of the 24 moving party’s spreadsheet adding any objections to each contested billing entry (next to 25 each row, in an additional column) so as to enable the Court to efficiently review the 26 objections and recompute the total amount of any award after disallowing any individual 27 5 The parties shall request any changes or additions to the entry of judgment as stated in 28 this Order by October 20, 2023, after which the Clerk will enter judgment based on this Order. billing entries. This spreadsheet does not relieve the non-moving party of the requirements 2|| of Local Rule 54.2(f) concerning its responsive memorandum. 3 Dated this 4th day of October, 2023. 4 5 . 6 /, Jennifer G. Zi 7 j United States District Judge 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

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