Jorge Luis Estrada vs. Royalty Carpet Mills, Inc.

Opposition

Cal. Super. - 4th Dist.December 13, 2013

B A K E R & H O S T E T L E R LL P A T T O R N E Y S AT L A W C L E V E L A N D © I A N hn A Oo 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 SABRINA L. SHADI, Bar No. 205405 VARTAN S. MADOYAN, Bar No. 279015 BAKER & HOSTETLER LLP 11601 Wilshire Boulevard, Suite 1400 Los Angeles, CA 90025-0509 Telephone: 310.820.8800 Facsimile: ~~ 310.820.8859 Emails: sshadi@bakerlaw.com vmadoyan@bakerlaw.com JOSEPH L. CHAIREZ, Bar No. 98698 MARCUS McCUTCHEON, Bar No. 281444 BAKER & HOSTETLER LLP 600 Anton Boulevard, Suite 900 Costa Mesa, CA 92626-7221 Telephone: 714.754.6600 Facsimile: 714.754.6611 Emails: jchairez@bakerlaw.com mmccutcheon@bakerlaw.com Attorneys for ROYALTY CARPET MILLS, INC. SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF ORANGE JORGE LUIS ESTRADA and PAULINA Case No.: 30-2013-00692890-CU-OE-CJC NAVA MEDINA, on behalf of themselves and all employees similarly situated, [Honorable Kim G. Dunning, Department CX104] Plaintiff, DEFENDANT ROYALTY CARPET Vv. MILLS, INC.’S OPPOSITION TO PLAINTIFFS JORGE LUIS ESTRADA ROYALTY CARPET MILLS, INC., and AND PAULINA NAVA MEDINA'’S, DOES 1 through 30, inclusive, MOTION FOR LEAVE TO FILE THIRD AMENDED COMPLAINT Defendants. Action Filed: December 13, 2013 SAC Filed: October 22, 2014 Defendant Royalty Carpet Mills, Inc. (“Defendant”), by and through its attorneys of record, hereby files its opposition to plaintiffs Jorge Luis Estrada (“Estrada”) and Paulina Nava Medina’s (“Medina”) (together, “Plaintiffs”) Motion for Leave to file a Third Amended Complaint (the “Motion”). 1 DEFENDANT ROYALTY CARPET MILLS, INC.’S OPPOSITION TO PLAINTIFFS JORGE LUIS ESTRADA PAULINA NAVA MEDINA’S MOTION FOR LEAVE TO FILE THIRD AMENDED COMPLAINT B A K E R & H O S T E T L E R LL P A T T O R N E Y S AT L A W C L E V E L A N D SN N N Oa 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 IL INTRODUCTION Plaintiffs seek to amend their complaint now, for the third time, as we approach year three of this action. The parties already have engaged in significant litigation and discovery over the course of the nearly three years this action has been pending, but with nothing to show for it except substantial attorneys’ fees and litigation costs. The case has dragged along for nearly three years as Plaintiffs have been engaged in an unfocused fishing expedition. Plaintiffs now further seek to delay this matter by expanding their search after nearly three years, to the prejudice of Defendants. This must come to an end. Plaintiffs seek leave to amend their complaint yet again, this time to add four new named plaintiffs, significantly expand the putative class definition by including individuals Defendant temporarily utilized through various temporary staffing agencies (which also would require the joinder of multiple additional defendants), and add new claims and theories of liability. However, contrary to Plaintiffs’ claim, the relevant information is nothing new. Plaintiffs have had the contact information of the four individuals for well over a year, have known since at least September 2015 (nearly a year) that Defendant utilized temporary staffing agencies, and has long known about the new alleged claims and theories of liability. Yet Plaintiffs have delayed without justification and have not adequately explained their delay in seeking to amend the complaint now. Plaintiffs also cannot reasonably oppose Defendant’s position that further amendment would result in prejudice. Moreover, Plaintiffs’ delay has even taken them well past the two-year discretionary dismissal time period. It is clear that Plaintiffs are engaged in dilatory tactics which must come to an end. Respectfully, Plaintiffs’ Motion should be denied for three main reasons: (1) Plaintiffs’ inexcusable and unwarranted delay in seeking leave; (2) the inevitable prejudice to Defendant; and (3) the futility of the proposed amendments to the complaint. 2 DEFENDANT ROYALTY CARPET MILLS, INC.’S OPPOSITION TO PLAINTIFFS JORGE LUIS ESTRADA PAULINA NAVA MEDINA’S MOTION FOR LEAVE TO FILE THIRD AMENDED COMPLAINT B A K E R & H O S T E T L E R LL P A T T O R N E Y S AT L A W C L E V E L A N D © oo a9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 11. FACTUAL BACKGROUND This action was originally filed on December 13, 2013, nearly three years ago, and the complaint has already been amended twice. First, on January 21, 2014, Estrada amended the complaint to add a new a cause of action. Then, on October 9, 2014, Estrada amended the complaint again to, among other things, add Medina as a party to the action. (Declaration of Sabrina L. Shadi (“Shadi Decl.”) § 2.) As a result of Plaintiffs’ unfocused efforts to prepare their case, the parties have spent considerable time and expense engaged in extensive and unending written discovery and depositions. In the nearly three years that the case has been pending, Plaintiffs have not requested that the court set a trial date and have yet to move to certify their purported class. Specifically, Plaintiffs’ unfocused barrage of discovery has included propounding a total of at least 15 sets of written discovery, including over 150 special interrogatories, over 85 inspection demands, as well as form interrogatories, supplemental interrogatories, and supplemental inspection demands. (/d. 93.) The parties have had to meet and confer several times regarding these sets of written discovery, and provide various supplemental responses. (/d.) Defendant has produced nearly 6,000 documents in discovery, to date, in this action. (Id. 94.) Among those documents was a contact list for the putative class members, including the four individuals Plaintiffs seek to add as named plaintiffs in this action, which Defendant produced in June 2015. (Id) Also among the information produced by Defendant in discovery was that Defendant has used multiple temporary staffing agencies to temporarily utilize individuals who could work in various manufacturing departments, which Plaintiff has known about since September 2015, if not earlier. (/d.) The parties went to private mediation in June 2015, but the case did not settle and litigation has been ongoing. (Id. 5.) Plaintiffs have refused Defendant’s offer to mediate unless, among other things, Defendant agrees to toll the statutory five-year mandatory dismissal deadline. (Id) Again, signaling Plaintiffs’ intent to drag this matter out another two years, past the mandatory dismissal deadline. Defendant has not agreed, and will not agree, to toll or waive 3 DEFENDANT ROYALTY CARPET MILLS, INC.’S OBJECTION TO PLAINTIFFS JORGE LUIS ESTRADA AND PAULINA NAVA MEDINA’S MOTION FOR LEAVE TO FILE THIRD AMENDED COMPLAINT B A K E R & H O S T E T L E R LL P A T T O R N E Y S AT L A W C L E V E L A N D 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 23 26 27 28 any dismissal deadlines, including the five-year mandatory dismissal statute. This case has crawled along needlessly for far too long and all to Defendant’s prejudice. III. ARGUMENT A. Legal Standard While a motion to permit an amendment to a pleading is at the discretion of the court, the exercise of this discretion must be sound and reasonable and not arbitrary or capricious. Morgan v. Superior Court of Cal. In & For Los Angeles County, 172 Cal. App. 2d 527, 530 (1959) (citations omitted). Code of Civil Procedure (“CCP”) section 473 permits the trial court in its discretion to allow amendments to pleadings in the furtherance of justice. “[N]evertheless, [] courts are much more critical of proposed amendments [] when offered affer long unexplained delay . . . or where there is a lack of diligence, or there is prejudice to the other party.” Hulsey v. Koehler, 218 Cal. App. 3d 1150, 1159 (1990) (emphasis added). See also Royal Thrift & Loan Co. v. Cnty. Escrow, Inc., 123 Cal. App. 4th 24, 41-42 (2004). Moreover, “the failure of a proposed amendment to state facts sufficient to constitute a cause of action may support an order denying a motion to amend.” La Jolla Vill. Homeowners’ Assn. v. Superior Court, 212 Cal. App. 3d 1131, 1141 (1989). See also California Casualty Gen. Ins. Co. v. Superior Court, 173 Cal. App. 3d 274, 280 (1985). B. Plaintiffs’ Motion Should be Denied As Plaintiffs Have Inexcusably Delayed In Seeking To Amend And Defendant Will Be Prejudice If Leave Is Granted Here, Plaintiffs seek leave to amend the complaint in order to file a third amended complaint, after sitting on information they have had for nearly a year (and in some cases more than a year). If the proposed amendment is allowed, Defendant would be severely prejudiced in that amendment will only increase the burden of discovery, which as detailed above has already been significantly time consuming and expensive, will further delay any class certification motion and trial, and will significantly add to the costs of litigation. The delay is so egregious that, even though we are approaching year three of this action, Plaintiffs still have not filed a motion for class certification or even set a hearing date in anticipation of filing a motion. 4 DEFENDANT ROYALTY CARPET MILLS, INC.’S OBJECTION TO PLAINTIFFS JORGE LUIS ESTRADA AND PAULINA NAVA MEDINA’S MOTION FOR LEAVE TO FILE THIRD AMENDED COMPLAINT B A K E R & H O S T E T L E R LL P A T T O R N E Y S AT L a w C L E V E L A N D Oo 0 3 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 The law is well settled that “a long deferred presentation of the proposed amendment without a showing of excuse for the delay is itself a significant factor to uphold the trial court’s denial of the amendment.” Bedolla v. Logan & Frazer, 52 Cal. App. 3d 118, 136 (1975). So, “even if a good amendment is proposed in proper form, unwarranted delay in presenting it may— of itself—be a valid reason for denial. Thus, appellate courts are less likely to find an abuse of discretion where, for example, the proposed amendment is [] offered after long unexplained delay or where there is a lack of diligence[.]” Melican v. Regents of Univ. of California, 151 Cal. App. 4th 168, 175 (2007) (citations omitted); Fair v. Bakhtiari, 195 Cal. App. 4th 1135, 1147 (2011) (“[A] court may deny a good amendment in proper form where there is unwarranted delay in presenting it.”) (citing Record v. Reason, 73 Cal. App. 4th 472, 486 (1999); accord, Yee v. Mobilehome Park Rental Review Bd., 62 Cal. App. 4th 1409, 1428-1429 (1998); Magpali v. Farmers Group, Inc. 48 Cal. App. 4th 471, 475 (1996)); M & F Fishing, Inc. v. Sea-Pac Ins. Managers, Inc., 202 Cal. App. 4th 1509, 1534 (2012). Here, Plaintiffs have inexcusably delayed seeking their proposed amendments. The complaint was filed almost three years ago. The parties have engaged in extensive discovery. Plaintiffs have had the contact information for the four individuals they seek to add as named plaintiffs for over a year, and have known, at a minimum, since September 2015 that Defendant has utilized temporary staffing agencies during the relevant time period. Yet they seek to add such allegations now, one year later and as we approach the third year of this action. Courts have denied motions seeking leave to amend under similar facts. For example, in Levy v. Skywalker Sound, 108 Cal. App. 4th 753, 770-71 (2003), the court denied plaintiff's request for leave to amend as plaintiff delayed in seeking said relief. Levy v. Skywalker Sound, 108 Cal. App. 4th 753, 770-71 (2003). Specifically, the plaintiff “waited several months after the [relevant document] was produced in discovery to seek leave to amend his complaint.” Id. The document which triggered Levy’s motion for leave to amend was produced approximately three months prior to Levy seeking leave to amend. See id. In addition, the court in Yee v. Mobilehome Park Rental Review Bd. (City of Escondido), denied plaintiff leave to amend in part because “the proposed amendments were offered more than two years after the original complaint 5 DEFENDANT ROYALTY CARPET MILLS, INC.’S OBJECTION TO PLAINTIFFS JORGE LUIS ESTRADA AND PAULINA NAVA MEDINA’S MOTION FOR LEAVE TO FILE THIRD AMENDED COMPLAINT B A K E R & H O S T E T L E R LL P A T T O R N E Y S AT L A W C L E V E L A N D NS Oo 0 9 O N On 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 was filed.” 62 Cal. App. 4th 1409, 1428-29 (1998). “[O]ur review of the record reveals no abuse of discretion in the denial of the request for leave to amend. [The] amendment was proposed [] nearly two years after the complaint was originally filed. [The Yees] did not give an explanation for leaving the claim[s] out of the original complaint or bringing the request to amend so late.” Id ; see also Record v. Reason, 73 Cal. App. 4th 472, 486-87 (1999) (denied leave to amend based on “new” discovery when the plaintiff “had knowledge of the circumstances on which he based the amended complaint” on the day he was injured.”). For similar reasons, the Motion should be denied. Plaintiffs have no explanation for why they are now seeking to amend this complaint after having had the relevant information for a year (much beyond the three-month period discussed in Levy). This is even truer considering that the complaint already has been amended twice in this action. And, as in Yee, this action has been pending for well beyond two years. Plaintiffs inexcusable delay, as established above, is itself sufficient grounds to deny their motion. In addition to that, however, Defendant certainly will be prejudiced if leave is granted. As Plaintiffs discuss in their motion, leave to amend cannot be granted where there is prejudice to the opposing party, such as delay in trial, loss of critical evidence, or added costs of preparation. Solit v. Tokai Bank, Ltd. New York Branch, 68 Cal. App. 4th 1435, 1448 (1999) (citing Hirsa v. Superior Court, 118 Cal. App. 3d 486, 490 (1981)). Prejudice also exists where amendment would increase the burden of discovery. See Magpali v. Farmers’ Group, Inc., 48 Cal. App. 4th 471, 486-488 (1996). Allowing Plaintiffs to amend this late in the game under the apparent facade that they only now learned of the allegations would undoubtedly prejudice Defendant. Defendant has already expended considerable time and resources defending this litigation. Again, this litigation has been ongoing for almost three years with no end in sight, and with needless discovery being propounded by Plaintiffs. (Shadi Decl. §3.) The discovery in this matter is well beyond the scope of this type of case. Defendant alone has produced nearly 6,000 documents, and the parties have already attempted private mediation once, which did not resolve the case. (Id. 4] 3-4.) Moreover, the case is already past the time where Plaintiffs should have moved for class certification, as we are approaching year three of this action. 6 DEFENDANT ROYALTY CARPET MILLS, INC.’S OBJECTION TO PLAINTIFFS JORGE LUIS ESTRADA AND PAULINA NAVA MEDINA’S MOTION FOR LEAVE TO FILE THIRD AMENDED COMPLAINT B A K E R & H O S T E T L E R LL P A T T O R N E Y S AT L a w C L E V E L A N D co 3 Oo n h \O 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Amending the complaint now, for the third time, would severely prejudice Defendant as it would require significantly more written discovery and depositions as it relates to the four named plaintiffs sought to be added to the complaint.” It also would require significantly more written discovery, depositions, and briefing by expanding the putative class definition to include temporary agency employees, who were hired from multiple agencies. In all likelihood, if leave were granted, these agencies would need to be joined as defendants in the action, thereby exponentially increasing the amount of written discovery and depositions needed. Litigation fees and costs would grow substantially, which is of particular concern given the significant time and costs expended thus far. In addition, Plaintiffs seek to add new theories of liability for the first time after nearly three years and extensive written discovery. This too would significantly increase litigations costs. And class certification briefing and trial would no doubt be delayed if leave to amend is granted given that the case would grow exponentially in size. Plaintiffs’ delay in resolving or bringing this matter to trial is so extreme that it has even pushed the matter well past the two-year discretionary dismissal statute.” Code Civ. Proc. § 583.410. Even if this were not enough, Plaintiffs stated in open court that they are not willing to mediate with Defendant unless Defendant agrees to toll or waive the five-year mandatory dismissal statute. Defendants will not agree to toll or waive any dismissal deadlines and thereby encourage Plaintiffs’ further delays. For the reasons detailed above, Plaintiffs should not be allowed to amend their complaint, for a third time, at the prejudice of Defendant, particularly given their inexcusable delay. C. Plaintiffs’ Motion Should Be Denied Because Amendment Would Be Futile While Plaintiffs” Motion should be denied for the reasons discussed above, it also should be denied because Plaintiffs seek to add claims that would be futile. “[Flailure of a proposed amendment to state facts sufficient to constitute a cause of action [] may support an order denying a motion to amend. That rule would find its most appropriate ! Defendant has already taken the depositions of both Estrada and Medina, and now would be required to take four more depositions if the Motion were granted. Defendant would be prejudiced if the Motion were granted given the extensive discovery taken to date over the course of nearly three years. * Defendants will be filing a separate motion to dismiss the current action in its entirety pursuant to the two-year discretionary dismissal statute. 7 DEFENDANT ROYALTY CARPET MILLS, INC.’S OBJECTION TO PLAINTIFFS JORGE LUIS ESTRADA AND PAULINA NAVA MEDINA’S MOTION FOR LEAVE TO FILE THIRD AMENDED COMPLAINT B A K E R & H O S T E T L E R LL P A T T O R N E Y S AT L A W C L E V E L A N D H O L D Oo © 9 OO On 10 11 12 13 14 15 16 17 18 19 20 21 2 23 24 25 26 27 28 application [] in cases in which the insufficiency of the proposed amendment is established by controlling precedent and where the insufficiency could not be cured by further appropriate amendment.” California Cas. Gen. Ins. Co. v. Superior Court, 173 Cal. App. 3d 274, 280-81 (1985); La Jolla Vill. Homeowners' Assn. v. Superior Court, 212 Cal. App. 3d 1131, 1141 (1989) (“While amendments are generally liberally construed, the failure of a proposed amendment to state facts sufficient to constitute a cause of action may support an order denying a motion to amend.”). As put by the court in Armenta ex rel. City of Burbank v. Mueller Co., when an amended complaint fails to properly state a cause of action, “the appropriate remedy would [be] for the court to deny leave to amend from the outset”. 142 Cal. App. 4th 636, 643 (2006), as modified (Sept. 1, 2006); Record v. Reason, 73 Cal. App. 4th 472, 486 (1999) (denying plaintiff’s request to amend the complaint on grounds that the “proposed amendment did not allege a viable claim”). Here, Plaintiffs’ Motion seeks to add new claims and/or theories of liability. For example, Plaintiffs seek to allege that Defendant never, under any circumstances, paid premium wages for failing to provide meal and rest periods, and Plaintiffs seek to allege that Defendant prevented employees at Porterville from leaving the facility to take their meal periods. (See, e.g., Plaintiffs’ Separate Statement In Support of Motion, Proposed Third Amended Complaint (“Proposed TAC”) Paragraphs 43, 47-49, 54, 94.) However, amendment would be futile because: (1) the former allegation is incorrect — Defendant did pay premium wages for certain non-compliant meal and rest periods during the relevant time period; and (2) the latter allegation fails to state a cause of action because it is not unlawful in California to require employees to stay on-site for meal periods if the employer pays them for the time spent on their meal periods, which Defendant does, in fact, do in Porterville but Plaintiffs conveniently choose to ignore. Moreover, Plaintiffs proposed complaint would allege that Defendant failed to timely authorize or permit employees to take their rest periods, and that the offered rest periods were “sometimes taken late . . ..” (See, e.g., Proposed TAC Paragraphs 54-59.) However, California law does not require rest periods to be taken at a specific time; it requires only that, if practicable, a rest period be authorized and 8 DEFENDANT ROYALTY CARPET MILLS, INC.’S OBJECTION TO PLAINTIFFS JORGE LUIS ESTRADA AND PAULINA NAVA MEDINA’S MOTION FOR LEAVE TO FILE THIRD AMENDED COMPLAINT B A K E R & H O S T E T L E R LL P A T T O R N E Y S AT L A W C L E V E L A N D 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 2 26 27 28 permitted in the middle of each work period. Industrial Welfare Commission Order No. 1-2001, Section 12(a). Therefore, given that Plaintiffs’ amendment would be futile here, the Court should deny Plaintiffs’ Motion. IV. CONCLUSION For the reasons set forth above, Plaintiffs’ Motion for Leave to File a Third Amended Complaint should be denied. Dated: August 24, 2016 BAKER & HOSTETLER LLP ww Ph Suh) JOSEPH L. CHAIREZ 7 SABRINA L. SHADI VARTAN S. MADOYAN MARCUS McCUTCHEON Attorneys for Defendant ROYALTY CARPET MILLS, INC. 9 DEFENDANT ROYALTY CARPET MILLS, INC.’S OBJECTION TO PLAINTIFFS JORGE LUIS ESTRADA AND PAULINA NAVA MEDINA’S MOTION FOR LEAVE TO FILE THIRD AMENDED COMPLAINT B A K E R & H O S T E T L E R LL P A T T O R N E Y S AT L A W LO S A N G E L E S 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 PROOF OF SERVICE I am employed in Los Angeles County, California. I am over the ‘age of eighteen years and not a party to the within-entitled action. My business address is 11601 Wilshire Boulevard, Suite 1400, Los Angeles, CA 90025-0509. On August 24, 2016, I served a copy of the within document(s): DEFENDANT ROYALTY CARPET MILLS, INC.’S OPPOSITION TO PLAINTIFFS JORGE LUIS ESTRADA AND PAULINA NAVA MEDINA’S MOTION FOR LEAVE TO FILE THIRD AMENDED COMPLAINT [] by placing the document(s) listed above in a sealed envelope with postage thereon fully prepaid, in the United States mail at Los Angeles, California addressed as set forth below. [] by placing the document(s) listed above in a sealed envelope and affixing a pre-paid air bill, and causing the envelope to be delivered to a FEDERAL EXPRESS agent for delivery. V] by transmitting via electronic mail the document(s) listed above to the e-mail address(es) set forth below on this date. Rudy Ginez, Jt., Esq. Clifton Smith GINEZ, STEINMETZ & ASSOCIATES CE Smith Law Firm 926 North Flower Street 1117 Village Drive Santa Ana, CA 92703 Oceanside, CA 92057 Telephone: (714) 541-2251 Telephone: (760) 754-5472 Facsimile: (714) 541-5807 Facsimile: (714) 541-5807 Email: ginez@sbcglobal.net Email: CESmithEsq@cox.net Attorneys for all Plaintiffs Attorneys for all Plaintiffs I am readily familiar with the firm's practice of collection and processing correspondence for mailing. Under that practice it would be deposited with the U.S. Postal Service on that same day with postage thereon fully prepaid in the ordinary course of business. Iam aware that on motion of the party served, service is presumed invalid if postal cancellation date or postage meter date is more than one day after date of deposit for mailing in affidavit. I declare under penalty of perjury under the laws of the State of California that the above is true and correct. PROOF OF SERVICE