ISAIAS VASQUEZ and LINDA HEFKE, CASE NO. 1:17-cv-00796-AWI-BAM
Plaintiffs, ORDER DENYING DEFENDANTS’ v. MOTION FOR RECONSIDERATION AND PLAINTIFFS’ MOTION FOR LEPRINO FOODS COMPANY and SANCTIONS LEPRINO FOODS DAIRY PRODUCTS COMPANY, (Doc. Nos. 166, 172)
Defendants.
I. Introduction In this lawsuit, two cheese manufacturing companies are being sued by two of their employees for violating California’s wage-and-hour laws. The two employees are Isaias Vasquez and Linda Hefke (collectively “Plaintiffs”). The two cheese manufacturing companies are Leprino Foods Company and Leprino Foods Dairy Products Company (collectively “Defendants” or “Leprino”).1 Plaintiffs moved for class certification pursuant to Rule 23(b)(3) of the Federal Rules of Civil Procedure. The Court granted that motion, in part. See Doc. No. 163 (Court’s certification order). Leprino then moved the Court to reconsider the certification order, arguing that the order is premised on an erroneous factual finding. See Doc. No. 166. Plaintiffs then moved for sanctions against Leprino, arguing that Leprino’s motion for reconsideration is frivolous. See Doc. No. 172. Leprino’s motion for reconsideration and Plaintiffs’ motion for sanctions are now before the Court. For the reasons discussed below, the Court will deny both motions.
1 In their briefing on Plaintiffs’ motion for class certification, the parties, including both defendants, made no distinction between, on one hand, Leprino Foods Company and, on the other hand, Leprino Foods Dairy Products Company. The parties treated both defendants as if they are a single entity, which the parties referred to as “Leprino.” II. Facts A. The Court concluded that Plaintiffs’ meal and rest break claim satisfies the commonality-predominance requirement of Rule 23(b)(3). Plaintiffs claim that Leprino’s policies and practices at the Lemoore West facility effectively placed the facility’s hourly-wage employees on call during meal and rest breaks, which is a violation of California Labor Code §§ 226.7, 512, and California Industrial Welfare Commission (“IWC”) Wage Order No. 8, Cal. Code Regs., tit. 8. The following is a summary of Plaintiffs’ theory for the meal and rest break claim: Based on Brinker [Brinker Rest. Corp. v. Superior Court, 53 Cal. 4th 1004 (2012)], and Augustus [Augustus v. ABM Sec. Servs., Inc., 2 Cal. 5th 257 (2016)], Plaintiffs’ theory for the meal and rest break claim is that although Leprino’s written meal and rest break policies are facially compliant, and although Leprino schedules facially compliant meal and rest breaks for its employees, Leprino nonetheless “requires the production workers at the Lemoore West plant to remain on-call during their breaks,” which is a violation of Wage Order No. 8 and Labor Code § 226.7. Doc. No. 116-1 at 26. Leprino claims that the following facts collectively demonstrate that Leprino’s employees are on call during their breaks: (1) Leprino’s policies stress quality and quotas and pressure employees to avoid production delays, even if that means working during breaks, for example, on machinery; (2) Leprino’s policies stress “over communication,” as illustrated, in part, by the radios, intercoms, and work phones in breakrooms; (3) Leprino’s written policies stress responsiveness and obedience to superiors’ requests and instructions, as illustrated in the employee handbook; (4) Leprino’s unwritten policies and practices require and pressure employees to carry their radios at all times and respond at all times to calls made on the intercom, breakroom phone, and in person, even if those calls are made during breaks; and (5) Leprino does not tell its employees that they need not respond to work-related matters during breaks. Collectively, these facility-wide policies and practices, according to Plaintiffs, demonstrate that the employees are effectively on call at all times, even during their breaks — which in turn means Leprino fails to provide legally compliant breaks. Doc. No. 163 at 24-25 In ruling on Plaintiffs’ motion for class certification, the Court ultimately concluded that Plaintiffs’ meal and rest break claim satisfies the commonality-predominance requirement of Rule 23(b)(3). Specifically, the Court concluded that Plaintiffs’ on-call theory naturally suited itself to the following common question: In light of Leprino’s foregoing class-wide policies and practices, are the class members actually on call during breaks? The Court arrived at this conclusion because the evidence from the parties sufficiently showed “that the class was subjected to Leprino’s foregoing policies and practices.” Id. at 25. The Court further concluded that the common question satisfied the commonality-predominance requirement of Rule 23(b)(3) because the “determination of the question’s truth or falsity will resolve an issue that is central to the validity of each member’s meal and rest break claim in one stroke.” Doc. No. 163 at 25 (citing Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 350 (2011)). By agreeing with Plaintiffs’ position, the Court simultaneously rejected one of Leprino’s arguments against class certification, which is that “the weight of the evidence” submitted by Plaintiffs and Leprino demonstrated that Plaintiffs’ witnesses are either lying or statistical outliers. Doc. No. 120 at 33. In making this argument, Leprino pointed to its own witness declarations from fifty-six Leprino employees, virtually all of whom uniformly declared that they and other employees at the facility were generally freed from employer control during breaks. The Court reviewed and considered Leprino’s witness declarations, just as it did with Plaintiffs’ witness declarations, and then the Court provided the following assessment of Plaintiffs’ and Leprino’s competing witness declarations: [Leprino’s witness] declarations, however, do not outweigh or refute the many witness declarations presented by Plaintiffs . . . , and this is for a fairly simple reason: of Leprino’s fifty-six declarations, no more than five are from employees who are putative members of the class . . . . The other fifty-one declarations come from salaried employees, all but one of whom . . . are either managers or supervisors. With respect to Plaintiffs’ on-call theory, the Court finds the testimony from most of Plaintiffs’ witnesses’ declarations more persuasive than the uniform testimony from Leprino’s salaried managers and supervisors, none of whom are putative members of the class. Doc. No 163 at 26-27. As will be discussed below, Leprino takes issue with the Court’s foregoing statements that “of Leprino’s fifty-six declarations, no more than five are from employees who are putative members of the class,” and none of “Leprino’s salaried managers and supervisors [are] putative members of the class.” Having concluded that Plaintiffs’ meal and rest break claim satisfied the requirements of Rule 23(b)(3), the Court certified the claim for class aggregation2 and defined the class as follows: All non-exempt hourly workers who are currently employed, or formerly have been employed, as non-exempt hourly employees at Leprino’s Lemoore West facilities / / /
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ISAIAS VASQUEZ and LINDA HEFKE, CASE NO. 1:17-cv-00796-AWI-BAM
Plaintiffs, ORDER DENYING DEFENDANTS’ v. MOTION FOR RECONSIDERATION AND PLAINTIFFS’ MOTION FOR LEPRINO FOODS COMPANY and SANCTIONS LEPRINO FOODS DAIRY PRODUCTS COMPANY, (Doc. Nos. 166, 172)
Defendants.
I. Introduction In this lawsuit, two cheese manufacturing companies are being sued by two of their employees for violating California’s wage-and-hour laws. The two employees are Isaias Vasquez and Linda Hefke (collectively “Plaintiffs”). The two cheese manufacturing companies are Leprino Foods Company and Leprino Foods Dairy Products Company (collectively “Defendants” or “Leprino”).1 Plaintiffs moved for class certification pursuant to Rule 23(b)(3) of the Federal Rules of Civil Procedure. The Court granted that motion, in part. See Doc. No. 163 (Court’s certification order). Leprino then moved the Court to reconsider the certification order, arguing that the order is premised on an erroneous factual finding. See Doc. No. 166. Plaintiffs then moved for sanctions against Leprino, arguing that Leprino’s motion for reconsideration is frivolous. See Doc. No. 172. Leprino’s motion for reconsideration and Plaintiffs’ motion for sanctions are now before the Court. For the reasons discussed below, the Court will deny both motions.
1 In their briefing on Plaintiffs’ motion for class certification, the parties, including both defendants, made no distinction between, on one hand, Leprino Foods Company and, on the other hand, Leprino Foods Dairy Products Company. The parties treated both defendants as if they are a single entity, which the parties referred to as “Leprino.” II. Facts A. The Court concluded that Plaintiffs’ meal and rest break claim satisfies the commonality-predominance requirement of Rule 23(b)(3). Plaintiffs claim that Leprino’s policies and practices at the Lemoore West facility effectively placed the facility’s hourly-wage employees on call during meal and rest breaks, which is a violation of California Labor Code §§ 226.7, 512, and California Industrial Welfare Commission (“IWC”) Wage Order No. 8, Cal. Code Regs., tit. 8. The following is a summary of Plaintiffs’ theory for the meal and rest break claim: Based on Brinker [Brinker Rest. Corp. v. Superior Court, 53 Cal. 4th 1004 (2012)], and Augustus [Augustus v. ABM Sec. Servs., Inc., 2 Cal. 5th 257 (2016)], Plaintiffs’ theory for the meal and rest break claim is that although Leprino’s written meal and rest break policies are facially compliant, and although Leprino schedules facially compliant meal and rest breaks for its employees, Leprino nonetheless “requires the production workers at the Lemoore West plant to remain on-call during their breaks,” which is a violation of Wage Order No. 8 and Labor Code § 226.7. Doc. No. 116-1 at 26. Leprino claims that the following facts collectively demonstrate that Leprino’s employees are on call during their breaks: (1) Leprino’s policies stress quality and quotas and pressure employees to avoid production delays, even if that means working during breaks, for example, on machinery; (2) Leprino’s policies stress “over communication,” as illustrated, in part, by the radios, intercoms, and work phones in breakrooms; (3) Leprino’s written policies stress responsiveness and obedience to superiors’ requests and instructions, as illustrated in the employee handbook; (4) Leprino’s unwritten policies and practices require and pressure employees to carry their radios at all times and respond at all times to calls made on the intercom, breakroom phone, and in person, even if those calls are made during breaks; and (5) Leprino does not tell its employees that they need not respond to work-related matters during breaks. Collectively, these facility-wide policies and practices, according to Plaintiffs, demonstrate that the employees are effectively on call at all times, even during their breaks — which in turn means Leprino fails to provide legally compliant breaks. Doc. No. 163 at 24-25 In ruling on Plaintiffs’ motion for class certification, the Court ultimately concluded that Plaintiffs’ meal and rest break claim satisfies the commonality-predominance requirement of Rule 23(b)(3). Specifically, the Court concluded that Plaintiffs’ on-call theory naturally suited itself to the following common question: In light of Leprino’s foregoing class-wide policies and practices, are the class members actually on call during breaks? The Court arrived at this conclusion because the evidence from the parties sufficiently showed “that the class was subjected to Leprino’s foregoing policies and practices.” Id. at 25. The Court further concluded that the common question satisfied the commonality-predominance requirement of Rule 23(b)(3) because the “determination of the question’s truth or falsity will resolve an issue that is central to the validity of each member’s meal and rest break claim in one stroke.” Doc. No. 163 at 25 (citing Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 350 (2011)). By agreeing with Plaintiffs’ position, the Court simultaneously rejected one of Leprino’s arguments against class certification, which is that “the weight of the evidence” submitted by Plaintiffs and Leprino demonstrated that Plaintiffs’ witnesses are either lying or statistical outliers. Doc. No. 120 at 33. In making this argument, Leprino pointed to its own witness declarations from fifty-six Leprino employees, virtually all of whom uniformly declared that they and other employees at the facility were generally freed from employer control during breaks. The Court reviewed and considered Leprino’s witness declarations, just as it did with Plaintiffs’ witness declarations, and then the Court provided the following assessment of Plaintiffs’ and Leprino’s competing witness declarations: [Leprino’s witness] declarations, however, do not outweigh or refute the many witness declarations presented by Plaintiffs . . . , and this is for a fairly simple reason: of Leprino’s fifty-six declarations, no more than five are from employees who are putative members of the class . . . . The other fifty-one declarations come from salaried employees, all but one of whom . . . are either managers or supervisors. With respect to Plaintiffs’ on-call theory, the Court finds the testimony from most of Plaintiffs’ witnesses’ declarations more persuasive than the uniform testimony from Leprino’s salaried managers and supervisors, none of whom are putative members of the class. Doc. No 163 at 26-27. As will be discussed below, Leprino takes issue with the Court’s foregoing statements that “of Leprino’s fifty-six declarations, no more than five are from employees who are putative members of the class,” and none of “Leprino’s salaried managers and supervisors [are] putative members of the class.” Having concluded that Plaintiffs’ meal and rest break claim satisfied the requirements of Rule 23(b)(3), the Court certified the claim for class aggregation2 and defined the class as follows: All non-exempt hourly workers who are currently employed, or formerly have been employed, as non-exempt hourly employees at Leprino’s Lemoore West facilities / / /
2 The Court also certified Plaintiffs’ claims that were derivative of the meal and rest break claim, such as the overtime original complaint until March 31, 2020. Doc. No. 163 at 31. Leprino then moved the Court to reconsider the certification order, arguing that the order was premised on an erroneous factual finding. See Doc. No. 166. Plaintiffs then moved for sanctions against Leprino, arguing that Leprino’s motion for reconsideration is frivolous. See Doc. No. 172. III. Leprino’s Motion for Reconsideration A. Leprino’s arguments. Leprino argues that the Court erred when it concluded that Plaintiffs’ meal and rest break claim satisfies the commonality-predominance requirement of Rule 23(b)(3). According to Leprino, the Court’s conclusion is wrong and should be reversed because it is premised on an erroneous factual finding. That factual finding is, according to Leprino, the Court’s finding that no more than five of Leprino’s fifty-six witness declarations come from employees who are putative members of the class and none of Leprino’s salaried managers and supervisors are putative members of the class. Leprino argues that this factual finding is erroneous because thirty- two of Leprino’s fifty-six witness declarants are putative members of the class, and some of those thirty-two witness declarants are currently salaried managers and supervisors. Leprino further argues that as a result of the Court’s erroneous finding, the Court “disregarded” and “ignored” Leprino’s witness declarations, such as the thirty-two witness declarations that came from putative members of the class. Doc. No. 166 at 6, 7, 14, 17. This was a critical error, argues Leprino, because those witnesses uniformly declared that they and other employees at Leprino were freed from employer control during breaks. Therefore, according to Leprino, if the Court had considered and properly weighed Leprino’s witness declarations, as opposed to ignoring and disregarding the witness declarations, then the Court would have correctly concluded that the commonality-predominance requirement is not satisfied, and this is because Leprino’s witness declarations prove that there is no “common practice or policy requiring that non-exempt employees remain on-call during breaks.” Id. at 6. In other words, Leprino argues that “the conflicting declarations amongst putative class members foreclose any conclusion that non-compliant breaks were the result of some de facto on-call policy.” Id. at 16. B. Legal standard. “The general rule regarding the power of a district court to rescind an interlocutory order is as follows: As long as a district court has jurisdiction over the case, then it possesses the inherent procedural power to reconsider, rescind, or modify an interlocutory order for cause seen by it to be sufficient,” including manifest error. City of Los Angeles, Harbor Div. v. Santa Monica Baykeeper, 254 F.3d 882, 885 (9th Cir. 2001) (citations omitted). “A district court’s power to rescind, reconsider, or modify an interlocutory order is derived from the common law,” not from Rule 59 or Rule 60 of the Federal Rules of Civil Procedure. Toole v. Baxter Healthcare Corp., 235 F.3d 1307, 1315 (11th Cir. 2000) (discussing Rule 59) (cited with approval in Santa Monica Baykeeper, 254 F.3d at 885); Bucy v. Nevada Const. Co., 125 F.2d 213, 217 (9th Cir. 1942) (discussing Rule 60) (cited with approval in Santa Monica Baykeeper, 254 F.3d at 887). C. Discussion. 1. The Court possesses the jurisdiction and inherent authority to reconsider and modify the certification order. The Court’s certification order is an interlocutory order. See Weil v. Inv./Indicators, Research & Mgmt., Inc., 647 F.2d 18, 25 (9th Cir. 1981); McKinsty v. Swift Transportation Co., of Arizona, LLC, 2017 WL 8943524, at *2 (C.D. Cal. Sept. 18, 2017). Because the Ninth Circuit has not granted a party permission to appeal the certification order, the Court retains jurisdiction over the certification order. Santa Monica Baykeeper, 254 F.3d at 886. Because the Court retains jurisdiction over the certification order, the Court possesses the inherent power to reconsider and modify the order for cause seen by the Court to be sufficient. Id. at 885. 2. The weight of the evidence supported the Court’s conclusion that the meal and rest break claim satisfies the commonality-predominance requirement. At the outset, the Court acknowledges that its foregoing statements — namely, that “of Leprino’s fifty-six declarations, no more than five are from employees who are putative members of the class,” and none of “Leprino’s salaried managers and supervisors [are] putative members of the class” — are factually incorrect. More than five of Leprino’s witness declarants are members of the class, and some of Leprino’s salaried managers and supervisors are members of the class. However, even though it is true that several of Leprino’s witness declarants are members of the class, this fact does not change the Court’s conclusion that the evidence from the parties sufficiently showed “that the class was subjected to Leprino’s foregoing policies and practices.” Doc. No. 163 at 25. First, immediately after the Court erroneously stated that vast majority of Leprino’s witness declarations came from individuals who are not members of the class, the Court correctly found that the overwhelming majority of Leprino’s witness declarations (at least fifty-one of the fifty-six declarations) came “from salaried employees, all but one of whom . . . are either managers or supervisors.” Id. at 26. The fact that the overwhelming majority of Leprino’s witness declarants were managers and supervisors at the time they provided their declarations is not disputed by Leprino, and the fact was significant to the Court’s conclusion that Leprino’s witness declarations failed to refute the evidence showing that the class was subjected to the policies and practices. This is to say, even if thirty-two of Leprino’s witness declarants were hourly-wage employees for Leprino at some point in time during the class period, thereby making them members of the class, the more important fact to the Court was that the overwhelming majority of Leprino’s witness declarants were managers and supervisors for Leprino at the time they provided their declarations. These witnesses were the very employees who were responsible for enforcing the allegedly unlawful policies and practices, and these employees had a greater interest in defending Leprino’s policies, practices, and business interests than low-level, hourly-wage employees.3 Consequently, due to their inherent bias, Leprino’s managers and supervisors failed to persuade the Court that Plaintiffs’ many witnesses were either lying or statistical outliers,4 see Ninth Circuit Manual of Model Civil Jury Instructions, Instruction No. 1.14, Credibility
3 Additionally, of Leprino’s five witness declarations that came from non-managers and non-supervisors, two of the declarations came from employees currently working in Leprino’s human resources department. See Decl. Angela Azpiroz; Decl. Casey McMahan. 4 In their opposition to Leprino’s motion for reconsideration, Plaintiffs stated that Leprino had the opportunity to obtain additional witness declarations from current hourly-wage employees, but Leprino instead obtained the overwhelming majority of its witness declarations from managers and supervisors. Plaintiffs further stated, “At the end of the day, Leprino chose to either forego obtaining declarations from current hourly employees, or found them of Witnesses (updated Dec. 2019) (stating that a witness’s credibility may be determined by considering the “witness’s interest in the outcome of the case” and “the witness’s bias or prejudice”), especially in light of the fact that Leprino’s undisputed official policies stressed quality, “over communication,” and responsiveness and obedience to superiors’ requests and instructions. Second, even when Leprino’s witness declarations are taken at face value, portions of the declarations fail to disprove Plaintiffs’ contention that Leprino maintained class-wide policies and practices that infringed on employees’ breaks. For example, many of Leprino’s own witnesses declared that they were occasionally contacted about work-related matters during their breaks, including through the radio, intercom, and breakroom phone. See, e.g., Decl. Salvador Amezcua; Decl. Jacob Avila; Decl. Daniel Barron; Decl. Roger Boling; Decl. Megan Bowen; Decl. Joseph Brown; Decl. Brian Cure; Decl. Jerry Espinoza; Decl. Matthew Garcia; Decl. Valerie Hall; Decl. Oscar Hernandez; Decl. James Jones; Decl. Ronald Vandyke; Decl. Anthony Vasquez. Moreover, many of Leprino’s own witnesses declared that they occasionally contacted other employees about work-related matters during the other employees’ breaks. See, e.g., Decl. Thomas Aquino; Decl. Eric Barber; Decl. Brian Cure; Decl. Brad Dennis; Decl. Matthew Garcia; Decl. Jordan Goodwin; Decl. James Jones; Decl. Jose Zepada. Moreover, when some of Leprino’s own witnesses were deposed, those witnesses testified to facts that support the finding that Leprino maintained class-wide policies and procedures that affected breaks. For example, both Monica Mata and Alejandro Osuna testified that they were contacted during breaks about work-related matters. Depo. Monica Mata; Depo. Alejandro Osuna. Additionally, Ronald Van Dyke testified that he would contact employees during their breaks “a couple times a week.” Depo. Ronald Van Dyke. Additionally, although Van Dyke stated in his declaration that there is “no reason” to interrupt employees when they are on breaks, Van Dyke testified in his deposition that he does not consider it a “break interruption” when an employee responds to a radio call while on break in the breakroom. See Decl. Van Dyke; Depo. Van Dyke. Additionally, both Van Dyke and Osuna testified that they were never instructed by Leprino to turn off their radios during breaks. Depo. Ronald Van Dyke; Depo. Alejandro Osuna. Additionally, Van Dyke
leaving the Court to conclude that Leprino did, in fact, have the opportunity to obtain additional declarations from testified that he does not recall being told by Leprino that he is free to choose if and when he responds to radio calls while he is on break. Depo. Ronald Van Dyke. Additionally, both Van Dyke and Mata testified that they were not given penalty pay for interrupted breaks. Depo. Ronald Van Dyke; Depo. Monica Mata. Finally, Kes Anderson, who has been Leprino’s human resources manager since 2010, testified that he has no reason to dispute an employee’s claim that he or she was contacted about a work-related matter during a break. Depo. Kes Anderson. Thus, for the above reasons, Leprino’s witness declarations do not undermine the Court’s conclusion that “Plaintiffs provided sufficient proof . . . showing for class certification purposes that the alleged policies . . . affected most, if not all, of the class members.” Doc. No. 163 at 26. Accordingly, Leprino’s motion for reconsideration will be denied. IV. Plaintiffs’ Motion for Sanctions A. Plaintiffs’ arguments. Plaintiffs argue that the Court should sanction Leprino for filing the motion for reconsideration because the motion is, first, frivolous and sanctionable under Rule 11 of the Federal Rules of Civil Procedure and, second, designed to delay the resolution of this lawsuit and sanctionable under 28 U.S.C. § 1927. As for Rule 11, Plaintiffs argue that Leprino’s motion is frivolous for two reasons. First, Leprino’s motion is based on the same argument that Leprino advanced in its opposition briefing to Plaintiffs’ motion for class certification. That argument is that Leprino’s witness declarations prove that the alleged policies and practices did not universally affect the class. Although the Court squarely rejected that argument in its certification order, Plaintiffs argue, Leprino nonetheless filed the motion for reconsideration to rehash the argument for a second time. Second, Leprino’s motion for reconsideration blatantly misconstrues the Court’s certification order. Specifically, even though the certification order clearly states and shows that the Court considered and weighed Leprino’s witness declarations, Leprino’s motion for reconsideration falsely accuses the Court of “ignor[ing]” and “disregard[ing]” Leprino’s witness declarations. As for 28 U.S.C. § 1927, Plaintiffs argue that Leprino’s motion for reconsideration is designed to delay the resolution of this lawsuit because the motion simply rehashes Leprino’s argument that Leprino’s witness declarations prove that the alleged policies and practices did not universally affect the class, even though the Court previously and clearly rejected that argument in its certification order. B. Legal standard. Sanctions are an appropriate response to willful disobedience of a court order . . . or when the losing party has acted in bad faith, vexatiously, wantonly, or for oppressive reasons. Aloe Vera of Am., Inc. v. United States, 376 F.3d 960, 965 (9th Cir. 2004); Fink v. Gomez, 239 F.3d 989, 991 (9th Cir. 2001). There are three primary mechanisms through which a court may sanction parties or their lawyers for improper conduct: (1) Rule 11 of the Federal Rule of Civil Procedure, which applies to signed writings filed with the court; (2) 28 U.S.C. § 1927, which is aimed at penalizing conduct that unreasonably and vexatiously multiplies the proceedings; and (3) the court’s inherent power. Fink, 239 F.3d at 991. Each of these mechanisms has its own particular requirements, and it is important that the grounds be separately articulated to assure that the conduct at issue falls within the scope of the sanctions remedy. Christian v. Mattel, Inc., 286 F.3d 1118, 1131 (9th Cir. 2002). 1. Rule 11. Under Rule 11, an award of sanctions is required if a frivolous paper is filed. Price v. State of Hawaii, 939 F.2d 702, 709 (9th Cir. 1991). Frivolous filings are those that are both baseless and made without a reasonable and competent inquiry. Buster v. Greisen, 104 F.3d 1186, 1190 (9th Cir. 1997). Rule 11 states: (b) Representations to Court. By presenting to the court a pleading, written motion, or other paper — whether by signing, filing, submitting, or later advocating it — an attorney or unrepresented party certifies that to the best of the person’s knowledge, information, and belief, formed after an inquiry reasonable under the circumstances:
(1) it is not being presented for any improper purpose, such as to harass, cause unnecessary delay, or needlessly increase the cost of litigation;
(2) the claims, defenses, and other legal contentions are warranted by existing law or by a nonfrivolous argument for extending, modifying, or reversing existing law or for establishing new law;
(3) the factual contentions have evidentiary support or, if specifically so opportunity for further investigation or discovery; and
(4) the denials of factual contentions are warranted on the evidence or, if specifically so identified, are reasonably based on belief or a lack of information.
(c) Sanctions. (1) In General. If, after notice and a reasonable opportunity to respond, the court determines that Rule 11(b) has been violated, the court may impose an appropriate sanction on any attorney, law firm, or party that violated the rule or is responsible for the violation. . . . Fed. R. Civ. P. 11. Rule 11 imposes a duty on attorneys to certify that (1) they have read the pleadings or motions they file and (2) the pleading or motion is grounded in fact, has a colorable basis in law, and is not filed for an improper purpose. See Smith v. Ricks, 31 F.3d 1478, 1488 (9th Cir. 1994). A court considering a request for Rule 11 sanctions should consider whether the position taken was frivolous, legally unreasonable, or without factual foundation, even if not filed in subjective bad faith. Zaldivar v. City of Los Angeles, 780 F.2d 823, 831 (9th Cir. 1986). 2. 28 U.S.C. 1927. 28 U.S.C. § 1927 states: Any attorney or other person admitted to conduct cases in any court of the United States or any Territory thereof who so multiplies the proceedings in any case unreasonably and vexatiously may be required by the court to satisfy personally the excess costs, expenses, and attorneys’ fees reasonably incurred because of such conduct. 28 U.S.C. § 1927. Sanctions are appropriate under § 1927 when there is no obvious violation of the Federal Rules, but where, within the Rules, the proceeding is conducted in bad faith for the purpose of delay or increasing costs. Pickern v. Pier 1 Imps. (U.S.), Inc., 339 F. Supp. 2d 1081, 1091 (E.D. Cal. 2004) (citing In re Yagman, 796 F.2d 1165, 1187 (9th Cir. 1986), as amended by 803 F.2d 1085 (9th Cir. 1986)). Stated differently, sanctions under § 1927 are appropriate when: (1) the attorney multiplied the proceedings; (2) the attorney’s conduct was unreasonable and vexatious; and (3) the conduct resulted in an increase in the cost of the proceedings. B.K.B. v. Maui Police Dep’t, 276 F.3d 1091, 1107 (9th Cir. 2002); Pickern, 339 F. Supp. 2d at 1091. An award of sanctions under § 1927 thus requires a finding of recklessness or bad faith. Ingle v. Circuit City, wOoOw 4:41 UVES DOPAINE MVOC eet POO tere PF 44 VI fe
408 F.3d 592, 596 (9th Cir. 2005); B.K.B., 276 F.3d at 1107. Conduct is vexatious or unreasonable when it is done recklessly, with knowledge. B.K.B., 276 F.3d at 1107; Pickern, 339 F. Supp. 2d at 1091. Discussion. As discussed above, the focus of Leprino’s motion for reconsideration was the factual finding made by the Court that “of Leprino’s fifty-six declarations, no more than five are from employees who are putative members of the class,” and none of “Leprino’s salaried managers and supervisors [are] putative members of the class.” Doc. No. 163 at 26-27. As the Court acknowledged above, this foregoing finding is incorrect. In light of the Court’s incorrect factual finding, the Court does not conclude that it is frivolous or vexatious for Leprino to argue that the Court’s certification ruling should be reconsidered. Leprino construed the Court’s incorrect finding to mean that the Court did not properly weigh Leprino’s witness declarations because, in the Court’s view, the vast majority of the declarants were not members of the putative class. This construction, according to Leprino, is warranted because the Court, in conjunction with stating the incorrect finding, indicated that Leprino’s witness declarations “do not outweigh or refute the many witness declarations presented Plaintiffs.” Id. at 26. Leprino’s position is neither baseless nor unreasonable.> Therefore, Plaintiffs’ motion for sanctions will be denied. Accordingly, IT IS HEREBY ORDERED as follows: 1. Leprino’s motion for reconsideration (Doc. No. 166) is DENIED; and 2. Plaintiffs’ motion for sanctions (Doc. No. 172) is DENIED. IT IS SO ORDERED. Dated: _ August 11, 2020 : : "SENIOR DISTRICT JUDGE > As this order makes clear, however, the Court’s ultimate certification ruling is sound and will not be reversed. 2g | Additionally, Leprino’s statements that the Court “ignored” and “disregarded” Leprino’s witness declarations are incorrect and, in turn, inappropriate. 1]