Opinion
BC 334354
Filed March 5, 2009
OPINION AND ORDER ON PLAINTIFFS' MOTION FOR CLASS CERTIFICATION
Plaintiffs move for class certification, this court having previously denied Defendants' Motion for Summary Judgment. This court has considered all of the briefs, objections and arguments presented on behalf of both Plaintiffs and Defendants. For the reasons stated in the following Opinion and Order, Plaintiffs' Motion for Class Certification is denied.
I. FACTUAL AND PROCEDURAL SUMMARY
Plaintiffs filed the initial Class Action Complaint on June 2, 2005 on behalf of all persons and/or entities that contracted and/or operated as agency operators with Defendants at Avis and Budget rental outlets in California. Plaintiffs seek relief under California's wage and hour laws to remedy Defendants' alleged misclassification of agency operators as independent contractors rather than as employees.
Plaintiffs' Third Amended Complaint ("TAC") was filed on December 8, 2006 and alleges nine causes of action for: (1) declaratory relief; (2) failure to pay overtime compensation (pursuant to Cal. Lab. Code § 1194); (3) failure to indemnify, and illegal wage deductions (Cal. Lab. Code §§ 226, 2802); (4) failure to allow, and pay for, meal and rest breaks (Cal. Lab. Code §§ 200, 226.7, 512); (5) failure to pay compensation upon discharge (Cal. Lab. Code §§ 201-03); (6) failure to provide accurate itemized wage statements; (7) conversion; (8) violation of Cal. Bus. Prof. Code § 17200; and (9) accounting.
Defendants subsequently filed a Motion for Summary Judgment, and as of December 12, 2007, only the second, third, fourth, fifth, sixth, eight, and ninth causes of action remain. Plaintiffs now seek class certification as to those remaining causes of action asserted in the TAC.
II. LEGAL ANALYSIS
A. Class Certification Requirements
Class actions are statutorily authorized "when the question is one of a common or general interest, of many persons, or when the parties are numerous, and it is impracticable to bring them all before the court. . . ." (Cal. Code Civ. Proc. § 382.) "A party seeking to certify a class bears the burden of demonstrating that there exists an ascertainable class and a well-defined community of interest in the questions of law and fact involved affecting the parties to be represented." ( Canon U.S.A., Inc. v. Superior Court (1998) 68 Cal.App.4th 1, 5, citing Brown v. Regents of Univ. of California (1984) 151 Cal.App.3d 982, 988).) "A class action also must be the superior means of resolving the litigation, for both the parties and the court." ( Newell v. State Farm Gen. Ins. Co. (2004) 118 Cal.App.4th 1094, 1101, citing Caro v. Procter Gamble Co. (1993) 18 Cal.App.4th 644, 657-662.)
"The critical inquiry on a motion for class certification is whether `the theory of recovery advanced by the proponents of certification is, as an analytical matter, likely to prove amenable to class treatment.'" ( Sony Electronics Inc. v. Superior Court (2006) 145 Cal.App.4th 1086, 1094, citing Sav-On Drug Stores, Inc. v. Superior Court (2004) 34. Cal.4th 319, 327). The question of whether to certify a class is "essentially a procedural one that does not ask whether an action is legally or factually meritorious." ( Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 439-440). However, in certain situations, "issues affecting the merits of a case may be enmeshed with class action requirements, such as whether substantially similar questions are common to the class and predominate over individual questions or whether the claims or defenses of the representative plaintiffs are typical of class claims or defenses." ( Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 443).
B. Ascertainability
Ascertainability "requires a class definition that is precise, objective and presently ascertainable." ( Sony Electronics Inc., supra, 145 Cal.App.4th at 1094). "Whether a class is ascertainable is determined by examining (1) the class definition, (2) the size of the class, and (3) the means available for identifying class members." ( Reyes v. Board of Supervisors (1987) 196 Cal.App.3d 1263, 1271, citing Vasquez v. Superior Court (1971) 4 Cal.3d 800, 821-822; see Sony Electronics Inc., supra, 145 Cal.App.4th at 1094.)
In the present matter, Plaintiffs' proposed class definition is ascertainable. During discovery, Plaintiffs received a class list which contained the names and last known address of each agency operator that has been employed by Defendants since the beginning of the class period. (Ex. 4 to Declaration of Stanley Saltzman.) The records produced clearly identify all potential class members.
C. Community of Interest
"The community of interest requirement embodies three factors: (1) predominant common questions of law or fact; (2) class representatives with claims or defenses typical of the class; and (3) class representatives who can adequately represent the class." ( Richmond v. Dart Industries, Inc. (1981) 29 Cal.3d, 462, 470; accord, Newell, supra, 118 Cal.App.4th at 1100.) "[A] class action is not inappropriate simply because each member of the class may at some point be required to make an individual showing as to his or her eligibility for recovery or as to the amount of his or her damages." ( In re Cipro Cases I II (2004) 121 Cal. App. 4th 402, 414 ( citing Employment Development Dept. v. Superior Court (1981) 30 Cal.3d 256, 266.)) However, where the fact issues underlying liability for each plaintiff are different, such that each member must litigate numerous and substantial questions to determine her right to recover, the advantages of a class action to the judicial process cannot be realized. ( See Lockheed Martin Corp. v. Superior Court (2003) 29 Cal.4th 1096, 1108.)
a. Common Questions of Law or Fact
Plaintiffs correctly argue that this case "is focused around one pivotal `gateway' issue, through which each and every legal and factual issue must flow, that being the question as to whether the class members are employees or independent contractors." (Plaintiffs' Memorandum of Points and Authorities in Support of Motion for Class Certification at 1.) In the Opinion and Order on Defendants' Motion for Summary Judgment dated December 17, 2007 ("MSJ Opinion"), this court analyzed the law bearing on the merits of whether Plaintiffs in this case should be considered employees or independent contractors.
In their Motion for Summary Judgment, Defendants argued that the Independent Operator Agreement governing the businesses operated by all class members definitively and correctly identifies the class here as independent contractors. This court, however, adopted Plaintiffs' argument, holding that the label used by the parties is not dispositive and that the "actual conduct" of the parties must be considered. (MSJ Opinion at 12-13, quoting Estrada v. FedEx Ground Package System, Inc. (2007) 154 Cal.App.4th 1, 10-11.)
This court held that the "control of details" analysis is the primary test that should be applied to determine whether the named Plaintiffs or other class members are employees or rather independent contractors. ( Id. at 12.) This court also held that the "economic reality test," based on factors enumerated in S. G. Borello Sons, Inc. v. Dep't of Indus. Relations (1989) 48 Cal.3d 341, 354-355, should be considered, especially because here the purported employees assist in performing functions that are part of the employer's business. (MSJ Opinion at 12, 16-17.)
In order for a class to be certified, therefore, Plaintiffs must demonstrate that common issues of fact predominate with respect to application of the multi-factor "control of details" and "economic reality" tests to individual class members. Certainly, some variation of factual detail is permissible as among class members. The mere presence of individual liability issues does not mean that the case cannot be litigated on a class basis. ( Dunbar v. Albertson's Inc. (2006)141 Cal.App.4th 1422, 1431.) However, there is an insufficient community of interest if all class members are required to litigate numerous and substantial individual questions in order to determine each class member's right to recover. ( Id. at 1431-1432, quoting Frieman v. San Rafael Rock Quarry, Inc. (2004) 116 Cal.App.4th 29, 40.)
1. "Control of Details" Test
With respect to the "control of details" test (discussed in the MSJ Opinion at pages 13-14), there undoubtedly are a significant number of common facts, in that the Independent Operator Agreement sets up a "turnkey operation" for the agency operators. Avis provides a leased premises (with utilities and furnishings), business license, signage, marketing material, car rental forms, uniforms, business cards and stationery. Avis provides computer terminals, the "Wizard Software platform," telephone system and manuals. Avis sets minimum business hours for the agency operator locations. Avis audits location appearance and marketing and business development. Avis audits compliance with Avis procedures for counter transactions. All of this is common ground.
However, other facts bearing on the "control of details" test vary from class member to class member. Plaintiff Duke, in opposing Defendants' Motion for Summary Judgment, presented evidence that Avis determines rental pricing for vehicles and that Duke only could set rental prices for "walk-up" business, which was a minimal amount of his business. ( See MSJ Opinion at 5, 14; see also Duke Decl. (filed in support of Motion for Class Certification) ¶¶ 7-8.) The evidence submitted by Defendants in opposing this Motion for Class Certification, however, demonstrates significant variation in the extent to which class members were able to control the details of pricing for vehicles rented from their respective agencies.
For example, Pastor Enrique Largaespada testified that whenever he thought his rates were not competitive with the market rate, he told Budget, which responded by changing the rates to his requested amount. (Largaespada Decl. ¶ 15 (Ex. T to Solish Decl.); Largaespada Depo. 109 (Ex. J to Supplemental Appendix in Support of Opposition).) Moreover, Mr. Largaespada indicated that he would manually lower his rates when he felt that he had an excess amount of cars in his fleet and his competitors had lower rates. (Largaespada Decl. ¶ 14; Largaespada Depo. 76.)
Similarly, Dwayne Mitchell indicated that Avis is "very good" about implementing his recommendations for rate changes. There were instances when he thought the rates needed to be increased, and Avis followed his suggestion. (Mitchell Decl. ¶ 16 (Ex. V to Solish Decl); Mitchell Depo. 202 (Ex. L to Supplemental Appendix in Support of Opposition).)
Likewise, Georgia Jozsa investigated her competitors' rates on a weekly basis and then recommended rates for her location, which Avis generally followed. (Jozsa Decl. ¶ 11 (Ex. R to Solish Decl.); Jozsa Depo. 105 (Ex. H to Supplemental Appendix in Support of Opposition).) Ziad Kabban testified that he worked out special rates with clients, subject to a minimum, and that Avis followed his recommendations about changing rates, although he would have liked more freedom to set a new rate without first recommending it. (Kabban Decl. ¶¶ 7-8 (Ex. S to Solish Decl.); Kabban Depo. at 43-44, 45 (Ex. I to Supplemental Appendix in Support of Opposition).)
Addressing the "control of details" test in the context of the summary judgment proceeding, Plaintiff Duke presented evidence that Avis determined which automobiles would be available for rent from his agency location. (MSJ Opinion at 5, 14.) Similarly, in this proceeding, Plaintiff Duke testified that he had no power to "control the inventory of cars at [his] location." (Duke Decl. ¶ 7.) Again, however, the evidence submitted by Defendants in opposing this Motion for Class Certification demonstrates significant variation with respect to class members' ability to control the details of the business with respect to obtaining vehicles for rent from their locations.
Various class members have testified that, although certain classes of vehicles are blocked at certain times, generally they have no trouble obtaining the vehicles that they need. Mr. Largaespada declared that he has "never really had problems with getting enough rental cars." (Largaespada Decl. ¶ 13.) Further, he believes that problems with fleet availability "can be avoided with good customer service and adequate preparation for the next day." ( Id.)
Ziad Kabban attested that generally he does "not have problems obtaining cars to rent," and when he does have a problem, he calls "distribution directly." When Avis "closes out" a particular kind of vehicle, he tries to work creatively to solve the problem. (Kabban Decl. ¶ 10.)
Sherry Moore, who was an agency operator for two locations, testified that she is "usually able to get the cars that [she] need[s] from Avis." She shuttles cars between her two locations, and she works with "Fleet Distribution and typically get[s] what [she] need[s]," although she understands "that all the locations have to share the same cars and there are only so many cars to go around." (Moore Decl. ¶ 7 (Ex. W to Solish Decl.).) Similarly, Umesh Pudaisini testified that he "usually [does] not have any problems getting a car [he] need[s]," although as to some specialty cars "there are only so many . . . to go around." (Pudaisini Decl. ¶ 15 (Ex. X to Solish Decl.).) 2. "Economic Reality" Test
The importance of these factual variations is magnified when consideration is given to the "economic reality" test for distinguishing between independent contractors and employees. As stated in this court's MSJ Opinion, the "economic reality" test "may be more appropriately applied in a situation where the service provider assists in performing functions that are part of the principal's business." (MSJ Opinion at 16-17.) "The `economic realities' test considers the degree of control exercised by the principal over the service provider by focusing on the relationship in the context of whether the service provider has an opportunity to create benefit for himself other than as a wage-earner." ( Id at 17.) As to two key prongs of the "economic reality" test, (1) the worker's opportunity for profit or loss depending on his managerial skill, and (2) the worker's investment in equipment or materials and his employment of helpers, there is substantial variation among class members.
(a) Worker's Opportunity for Profit or Loss Depending on Managerial Skill. Drawing all inferences in favor of Plaintiff Duke, this court determined in the MSJ Opinion that Duke has "limited opportunity to cut costs, other than by adjusting wages and hours of particular workers at the Brentwood location, and has limited opportunity to increase revenues, other than by increasing customers through sales contacts and selling more fuel and options." ( Id. at 17.) In drawing this conclusion, this court relied on Plaintiff Duke's evidence that he "is limited to offering specific models and kinds of cars at prices set by Avis, except for walk-in trade, which constitutes a relatively small part of his business." ( Id.)
As discussed above, however, other class members have testified that they had significant control over both the rental prices charged and the nature of the inventory available for rent. Pricing, product and supply are fundamental factors affecting a business' profit or loss. For class members who have substantial control over these factors, exercise of their managerial skill does provide significantly greater opportunities for determining profit or loss than the opportunities available according to Plaintiff Duke's testimony.
Plaintiff Duke also testified that he had minimal opportunity to affect the demand for Avis vehicles rented through his location. Duke testified that his approach to marketing was to pick up "business cards at each place so [he] could prove [he] went there." (Duke Depo. 106 (Ex. D to Supplemental Appendix in Support of Opposition).) Similarly, named Plaintiff Sharon DeYoung testified that she did only limited marketing on three or four occasions and always in the company of a Budget representative. (DeYoung Depo. 106-107 (Ex. C to Solish Decl.).)
In contrast, other class members testified to their opportunities for obtaining business for their specific agency locations and to marketing efforts that were within their individual control. Mr. Mitchell testified that he spends a substantial amount of time each week on marketing (although Plaintiffs question whether his estimated number of hours is credible in light of his other activities). (Mitchell Decl. ¶ 17 (Ex. V to Solish Decl.).) He considers marketing the "bread and butter" of his operation and uses signs and brochures of his own creation. ( Id.) Through his efforts he has been able to generate some corporate accounts leasing on a month-to-month basis. (Mitchell Depo. at 166-167 (Ex. L to Supplemental Appendix in Support of Opposition).)
Jean Ndjongo testified that he marketed using pens, wall calendars, local print advertising and local school team sponsorship, even using a unique slogan he thought of and cleared with Avis. (Ndjongo Depo. 33-40 (Ex. H to Solish Declar.).) He testified that these efforts increased his business. ( Id. at 36-37, 39-40.) Mr. Ndjongo explained that although the previous two operators had not been able to do well at the location, he "took the initiative to spend the money to make the business grow" and his business increased due to his efforts. ( Id. at 25.)
Umesh Pudaisini's practice of giving away items such as Starbucks gift cards, candy and pens and running coupons in the MLS listings has resulted in the acquisition of 40 percent of his competitor's business. (Pudaisini Decl. ¶ 11 (Ex. X to Solish Decl.).) Angel Maria Borg increased her marketing efforts by organizing a grand opening pool party for her Budget Santa Ana location. She also testified that she purchased coffee for hotel employees and others that she thought might refer business. (Borg Depo. 172-175, 240-241 (Ex. B to Solish Decl.).)
Bassem Elasmer structures his marketing efforts in recognition of the fact that his agency location is in a residential area. He makes fliers and coupons, uses the Penny Saver advertising circular and visits (and revisits) new businesses. (Elasmer Decl. ¶ 8 (Ex. N to Solish Decl.).) He adjusts rates for customers who give him referrals ( id. ¶ 16) and gives special rates to repeat customers ( id ¶ 20). Because of his "customer service skills," he has many repeat customers. ( Id. ¶ 20.)
In sum, the marketing efforts of putative class members vary significantly and some putative class members are able to develop better profit opportunities by exercising managerial skills appropriate to their individual business circumstances. Thus, there is significant variation among class members with respect to facts bearing on whether an agency operator has an opportunity for profit or loss depending on individual managerial skill.
(b) The Worker's Investment in Equipment or Materials and his Employment of Helpers.
There is little variation among class members with respect to investment in equipment or materials other than with respect to marketing, as described above. However, individual agency operators' approaches to employment of helpers vary significantly.
In the proceedings on Defendants' Motion for Summary Judgment, Plaintiff Duke testified that it was not economically feasible for agency operators to hire a manager to work the location, rather than personally working at their agency locations. ( See MSJ Opinion at 3-4.) However, other class members had different views and business models.
Some operators ran more than one Avis location, although Avis, as a matter of policy, discourages and limits second store opportunities. Sherry Moore became an agency operator at Lancaster in January 2002 and opened a second location in Palmdale in December 2007. (Moore Decl. ¶¶ 4-5 (Ex. W to Solish Decl.).) Bassem Elasmer became an agency operator in 2005 and opened a second location in May 2008. (Elasmer Decl. ¶¶ 2-3 (Ex. N to Solish Decl.).) Umesh Pudaisini was offered a second location after he was successful in running his first location, although he later made plans to close the second store. (Pudaisini Decl. ¶ 2 (Ex. X to Solish Decl.); Pudaisini Depo. at 19 (Ex. J to Humphrey Decl.).) These operators obviously had to use employees in their businesses because they could not be in two places at one time. For example, Mr. Pudaisini testified that he split his time, 30 percent at one location and 70 percent at another location, and that he personally did not have "any set schedule" at either location. (Pudaisini Decl. ¶ 6.)
Other members of the putative class ran other types of businesses while also running their Avis locations. For instance, Bassem Elasmer testified that during one period of time he only spent a couple of hours each day at his location, as he spent the majority of his time running his tobacco-manufacturing business. (Elasmer Depo. 65-66 (Ex. G to Supplemental Appendix in Support of Opposition).) Similarly, Jean Ndjongo sold real estate through Century 21 and did electrical engineering consulting work while operating an Avis location. (Ndjongo Depo. 15-17 (Ex. H to Declaration of Jonathan Solish).) Karl Lindinger hired a manager for his Avis agency location so that he could devote time to getting a Jackson Hewitt tax service franchise started. (Lindinger Depo. 163-164 (Ex. F to Solish Decl.).)
Putative class member Dan Curry used a manager at his location as a way of attempting to improve his business. He has employed between three and five workers, one of whom is a manager, and this allows him to go out and talk to potential clients every day. (Curry Decl. ¶¶ 11, 19 (Ex. L to Solish Decl.); Curry Depo. 57-58 (Ex. 5A to Plaintiffs' Amended Appx. of Putative Class Member Testimony).)
Conversely, some class members have attempted to minimize the hiring of additional help at their locations. Ziad Kabban testified that he worked by himself for five to six months upon opening his location and continued working a 55-hour work week thereafter because he desired to "run a lean operation so that [he could] make as much money as possible." (Kabban Decl. ¶ 12 (Ex. S to Solish Decl.); Kabban Depo. 81, 83 (Ex. I to Supplemental Appendix in Support of Opposition).) Angel Maria Borg at some times ran her agency with the labor only of herself and her nephew, who is her business partner. (Borg Depo. 14, 67, 227 (Ex. B to Supplemental Appendix in Support of Opposition; Ex. B to Solish Decl.).)
As stated in this court's MSJ Opinion, "the fact the service provider may employ others does not automatically make him an independent contractor." (MSJ Opinion at 17-18.) But a putative class member's decision to run his location substantially using the labor of others shifts the "economic reality" test more strongly in Defendants' favor. Again, there is significant variation among class members with respect to this factor.
3. Factual Variation Requires Individualized Proof and Analysis
In sum, there are substantial variations among class members in the facts relevant to both the "control of details" and the "economic reality" tests for determining whether a class member is an employee or independent contractor. Despite the factual commonality with respect to many aspects of the agency operator arrangement, the variations are sufficiently substantial, and the variations pertain to sufficiently important aspects of the employee vs. independent contractor dichotomy, that a jury could find that some class members are independent operators and others are employees.
Class certification is not defeated merely because some class members may prevail while others may not. However, the proof in this case inevitably will focus on the non-common aspects of the multi-factor test for determining if a corporate agent is an employee or an independent contractor. The nature of the factual variation is such that Defendants must be permitted to defend against putative class members' claims by offering evidence of facts individual to particular class members.
The claims of class members do not have to be identical in order for a class to be certified, but plaintiffs have not suggested any innovative management tool by which class members can be assigned to groups, or some other case management mechanism to avoid the need to present facts relevant to each individual class member's claims. ( Cf., Dunbar, supra, 141 Cal.App.4th at 1432.) Therefore, this court finds that common issues of fact do not predominate with respect to the liability claims asserted in this case.
b. Typicality of the Proposed Class Representative's Claims or Defenses
Under the "community of interest" requirement, Plaintiff Duke's claims must also be "typical" of those of the proposed class members. "[T]he purpose of the [typicality requirement] `is to assure that the interest of the named representative aligns with the interests of the class'" ( Seastrom v. Neways, Inc. (2007) 149 Cal.App.4th 1496, 1502, quoting Hanon vs. Dataproducts Corp. (9th Cir. 1992) 976 F.2d 497, 508.) If there is a conflict that goes to the "very subject matter of the litigation" it "will defeat a party's claim of representative status." ( Richmond v. Dart Industries, Inc. (1981) 29 Cal.3d 462, 470.)
In this case, the named Plaintiffs challenge the legality of written contracts existing between individual members of the putative class and Defendants. It is true, as the named Plaintiffs argue, that they seek damages by way of overtime and reimbursement of expenses, and that, in and of themselves, these damages would benefit all class members. However, the named Plaintiffs also acknowledge that, if they succeed in this case, Defendants will be required to treat putative class members as employees, and that the Independent Operator Agreements necessarily would be unenforceable.
"Once this Court has ruled, as plaintiffs hope it will, that the claims asserted are correct, and that the operators should have been treated as `employees' during the class period based on the proof offered, it will be up to the defendants to then restructure its business model to conform to California law." (Plaintiffs' Reply Brief at 23.)
There is a conflict among members of the putative class with respect to the theory of recovery pursued by the named Plaintiffs and the consequences sought in this lawsuit. Jean Ndjongo has brought suit against Avis in San Bernardino County Superior Court seeking to enforce the Independent Operator Agreement he signed and challenging Avis' termination of him as an agency operator. (Ex. B to Avis' Request for Judicial Notice in Opposition to Class Certification.) At least four other members of the putative class have brought suit contending that the Independent Operator Agreement is subject to California's laws governing franchises. (Decl. of Kerry Morris in Support of Avis' Opposition to Class Certification ¶¶ 5-6.) As Defendants point out, the protections of California franchise law are not waivable. (Cal. Bus. Prof. Code § 20010.)
Other class members take the position that they are better off as independent contractors under the Independent Operator Agreement than as employees. For instance, John Edwards indicated that he "would never consider obtaining employment as an Avis employee because [he] can make a lot more money as an agency operator." (Edwards Decl. ¶ 9 (Ex. M to Solish Decl.).) Similarly, Dwayne Mitchell stated that he "enjoy[s] being an agency operator because [he] does not want to be anyone's employee," and that he views the agency operator system as "an excellent program and a great opportunity to own your own business" (Mitchell Decl. ¶¶ 18-19 (Ex. V to Solish Decl.); see Mitchell Depo. at 42 (Ex. L to Supplemental Appendix in Support of Opposition).) Sherry Moore also enjoys the freedom and flexibility associated with being an independent contractor, and she stated that "[b]eing an agency operator allows [her] the flexibility that [she] need[s] with the income that [she] want[s]" and that she "would not want to be an employee. . . ." (Moore Decl. ¶ 17 (Ex. W to Solish Decl.); see Moore Depo. 89-90 (Ex. M to Supplemental Appendix in Support of Opposition).) Georgia Jozsa also testified that she enjoys the time flexibility and the money she makes and that she would never change the basic operator system." (Jozsa Decl. ¶ 21 (Ex. R to Solish Decl.); see Jozsa Depo. at 72-73 (Ex. H to Supplemental Appendix in Support of Opposition).)
The named Plaintiffs offer arguments as to why these agency operators would be better off being treated as employees. (Reply Brief at 7-8, 13.) But the named Plaintiffs are expressing their own views from their own perspective. This is not a situation, like that presented in Richmond v. Dart Industries (1981) 29 Cal.3d 462, 477, in which "[b]oth the named plaintiffs and the absent class members seek the benefit of the bargain they made with the defendants." Rather, in this case, the named Plaintiffs seek to avoid the contractual relationship they entered into with Defendants, but absent class members assert that they benefit from the same contractual relationship and seek to preserve it. Making the class even less cohesive, still other absent class members seek to regulate their relationship with Defendants in accordance with California's franchise laws, a position that is incompatible with the claims asserted by the named Plaintiffs here.
The "very subject matter of [this] litigation" is inconsistent with the asserted interests of absent class members. ( See id. at 470.) Thus the claims asserted here are not typical of those of the class. The named Plaintiffs do not suggest that defining subclasses or some other procedural mechanism could satisfy the due process difficulties presented, and this court does not believe that subclasses could cure the underlying problem.
D. Superiority
"A class action also must be the superior means of resolving the litigation, for both the parties and the court." ( Newell v. State Farm Gen. Ins. Co. (2004) 118 Cal.App.4th 1094, 1101, citing Caro v. Procter Gamble Co. (1993) 18 Cal.App.4th 644, 657-662.) Relief on a class basis is particularly appropriate when numerous parties suffer harm that is insufficient to warrant individual lawsuits and thus the unavailability of class relief would unjustly enrich the wrongdoer. ( Id.)
In Sav-On Drug Stores, Inc. v. Superior Court (2004) 34 Cal.4th 319, 340, the California Supreme Court recognized that considerations of sound public policy support allowing claims under California's wage and overtime laws to be resolved on a class basis, especially when such claims are too small to justify individual litigation. Here, however, the claims of each class member are sufficiently sizable that litigation of individual claims is viable. As discussed above, the class members' claims asserted here would require individual treatment under California's multi-factor balancing test. This court concludes that the interests of the parties and judicial economy would not be served by class litigation. If multiple individual claims are filed, case management techniques exist for combining pretrial proceedings to reduce transaction costs for all parties. A class action is not the superior method for resolving this litigation.
ORDER
For all of the reasons set forth above, Plaintiffs' Motion for Class Certification is denied.