Mariter Roldan et al v. Fresenius Medical Care North America Limited Partnership et al

NOTICE OF MOTION AND MOTION to Dismiss Case for Failure to State a Claim Upon Which Relief Can Be Granted

C.D. Cal.June 19, 2017

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) DAVID H. STERN (SBN 196408) ALEX E. SPJUTE (SBN: 229796) CAROLIN SAHIMI (SBN 260312) HUGHES HUBBARD & REED LLP 350 South Grand Avenue, 36th Floor Los Angeles, CA 90071-3442 Telephone: (213) 613-2800 Facsimile: (213) 613-2950 Email: david.stern@hugheshubbard.com Email: alex.spjute@hugheshubbard.com Email: carolin.sahimi@hugheshubbard.com Attorneys for Defendants FRESENIUS MEDICAL CARE NORTH AMERICA HOLDINGS LIMITED PARTNERSHIP, BIO-MEDICAL APPLICATIONS OF CALIFORNIA, INC., RENAL ADVANTAGE INC., FRESENIUS MEDICAL CARE - EUCALYPTUS, LLC, FRESENIUS MEDICAL CARE GOLDENWEST, LLC UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA MARITER ROLDAN, on behalf of herself and all others similarly situated, Plaintiffs, v. FRESENIUS MEDICAL CARE NORTH AMERICA LIMITED PARTNERSHIP, a Delaware limited partnership; BIO-MEDICAL APPLICATIONS OF CALIFORNIA, INC., a Delaware corporation; RENAL ADVANTAGE INC., a Delaware corporation; FRESENIUS MEDICAL CARE - EUCALYPTUS, LLC, a Delaware limited liability company; FRESENIUS MEDICAL CARE GOLDENWEST, LLC, a Delaware limited liability company; and DOES 1through 100, inclusive, Defendants. CASE NO. 2:17-CV-04341 JVS (Ex) Assigned for All Purposes to: Honorable James V. Selna DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM UPON WHICH RELIEF CAN BE GRANTED (FRCP 12(b)(6)), OR, IN THE ALTERNATIVE, TO DISMISS OR STAY THIS ACTION UNDER THE COLORADO RIVER DOCTRINE (FRCP 12(b)(1)); MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF Complaint Filed: April 27, 2017 Hearing: July 24, 2017 Time: 1:30 p.m. Courtroom: 10C Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 1 of 29 Page ID #:112 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 1 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD: PLEASE TAKE NOTICE that at the date, time, and courtroom noted above, located at Santa Ana Federal Courthouse, 411 West 4th Street, Santa Ana, California 92701-4516, Defendants Fresenius Medical Care North America Holdings Limited Partnership (“Fresenius Holdings LP”), wrongfully named in this action as Fresenius Medical Care North America Limited Partnership, Bio-Medical Applications of California, Inc. (“Bio-Medical Applications”), Renal Advantage Inc. (“Renal Advantage”), Fresenius Medical Care - Eucalyptus, LLC (“Eucalyptus”), and Fresenius Medical Care Goldenwest, LLC (“Goldenwest”) (all collectively, “Defendants”), will and hereby move the Court to dismiss the action pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure because Plaintiff’s Complaint fails to state a claim upon which relief can be granted, or, in the alternative, to dismiss or stay this action under the Colorado River doctrine pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure. This Motion is made on the grounds that Plaintiff’s Complaint (1) fails to state any facts in support of its California wage and hour claims, relying instead on improper conclusory allegations, and (2) fails to sufficiently state an alter ego or agency claim against Fresenius Holdings LP. In the alternative, Defendants request the Court dismiss or stay this action under the Colorado River doctrine in light of a previously filed class action, currently pending in California Superior Court for the County of San Diego, captioned Yolanda Gonzales et al. v. Fresenius Medical Care Holdings et al., Case No. 37-2013-00072469-CU-OE-CTL (the “San Diego Action”), that is substantially identical to this action. This motion will be based upon this Notice of Motion and Motion, the Memorandum of Points and Authorities, Request for Judicial Notice, and Declaration of David Stern concurrently filed herewith, the papers and pleadings filed in this action, and such other papers as may be filed with the Court. Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 2 of 29 Page ID #:113 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 2 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) This Motion is made following the conference of counsel pursuant to L.R. 7- 3 which took place on June 12, 2017. Dated: June 19, 2017 HUGHES HUBBARD & REED LLP By: /s/ David H. Stern David H. Stern Attorneys for Defendants Fresenius Medical Care North America Holdings Limited Partnership (wrongfully named as Fresenius Medical Care North America Limited Partnership), Bio-Medical Applications of California, Inc., Renal Advantage Inc., Fresenius Medical Care - Eucalyptus, LLC, Fresenius Medical Care Goldenwest, LLC E-mail: david.stern@hugheshubbard.com Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 3 of 29 Page ID #:114 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 i 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) TABLE OF CONTENTS Page I. PRELIMINARY STATEMENT ...................................................................... 1 II. BACKGROUND .............................................................................................. 2 III. ARGUMENT ................................................................................................... 3 A. Plaintiff’s Conclusory Complaint Fails Under Rule 12(b)(6). .............. 4 1. Dismissal Standard under Rule 12(b)(6). .................................... 4 2. Plaintiff Inadequately Pleads Liability. ....................................... 5 a. Plaintiff’s “Direct” Causes of Action are Pleaded in Conclusory Fashion. .......................................................... 5 b. Plaintiff’s “Derivative” Claims Also Fail. ........................ 7 3. Plaintiff Fails To Allege Any Facts To Support Her Conclusory Allegations of Agency and Alter Ego Liability. ....................................................................................... 8 a. Plaintiff Does Not Allege Facts Sufficient To Show That Fresenius Holdings LP - Or The Other Named Defendants - Are Her Employers Under California Labor Law. ....................................................... 9 b. Plaintiff Does Not Sufficiently Allege That Fresenius Holdings LP Is Liable Under An Alter Ego Theory. ..................................................................... 11 B. This Action Should Be Dismissed or Stayed Under the Colorado River Doctrine Pursuant to Rule 12(b)(1) to Further the Interests of Wise Judicial Administration. ......................................................... 12 1. The Class Claims in the San Diego Action Are Sufficiently Similar to the Class Claims in this Action to Justify Dismissing or Staying this Action. ................................ 13 2. The Colorado River Factors Weigh in Favor of Dismissing or Staying this Action. ............................................ 15 IV. CONCLUSION .............................................................................................. 20 Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 4 of 29 Page ID #:115 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 ii 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) TABLE OF AUTHORITIES Page(s) Am. Int’l Underwriters (Philippines), Inc. v. Continental Ins. Co., 843 F.2d 1253 (9th Cir. 1988) ....................................................................... 18, 19 Ashcroft v. Iqbal, 556 U.S. 662 (2009) .......................................................................................... 4, 6 Baker v. Chin & Hensolt, Inc., No. C-09-4168 MMC, 2010 WL 1222783 (N.D. Cal. Mar. 24, 2010) .................................................................................................................... 10 Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) ...................................................................................... 4, 5, 7 Bowes v. Christian Record Services, No. CV 11-799-CAS (DTBx), 2011 WL 3682766 (C.D. Cal. Aug. 22, 2011) ................................................................................................................ 9 Briosos v. Wells Fargo Bank, 737 F. Supp. 2d 1018 (N.D. Cal. 2010) ................................................................. 8 Canopus Biopharma, Inc. v. Supportive Therapeutics, LLC, No.CV15-9439 PSG, 2016 WL 7438795 (C.D. Cal. Mar. 25, 2016) ........... 17, 19 Cerit v. Cerit, 188 F. Supp. 2d 1239 (D. Haw. 2002) ................................................................ 19 Clarke v. First Transit, Inc., Case No. CV 07-6476 GAF, 2008 WL 11281125 (C.D. Cal. Feb. 7, 2008) .................................................................................................................... 17 Colorado River Water Conservation Dist. v. United States, 424 U.S. 800 (1976) ..................................................................................... passim In re Countrywide Fin. Corp. Derivative Litig., 542 F. Supp. 2d 1160 (C.D. Cal. 2008) ......................................................... 14, 16 Doe v. Wal-Mart Stores, Inc., 572 F.3d 677 (9th Cir. 2009) ......................................................................... 10, 11 Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 5 of 29 Page ID #:116 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 iii 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) El Centro Foods, Inc. v. Nazarian, No. CV09-06395 ODW, 2010 WL 1710286 (C.D. Cal. Apr. 21, 2010) ........................................................................................................ 14, 17, 18 Enfission, Inc. v. Leaver, 408 F. Supp. 2d 1093 (W.D. Wash. 2005) .......................................................... 14 Equity Lifestyle Properties, Inc. v. Cnty. of San Luis Obispo, 548 F.3d 1184 (9th Cir. 2008) ............................................................................. 13 In re Gilead Scis. Sec. Litig., 536 F.3d 1049 (9th Cir. 2008) ........................................................................... 5, 6 Gutierrez v. Aaron’s Inc., No. 2:10-cv-02417-MCE-EFB, 2010 WL 4968142 (E.D. Cal. Dec. 1, 2010) ......................................................................................................... 8 Hokama v. E.F. Hutton & Co., Inc., 566 F. Supp. 636 (C.D. Cal. 1983) ...................................................................... 12 Holder v. Holder, 305 F.3d 854 (9th Cir. 2002) ......................................................................... 16, 17 Johns v. Rozet, 770 F. Supp. 11 (D.D.C. 1991) ........................................................................... 19 Krantz v. Bt Visual Images, 89 Cal. App. 4th 164 (2001) .................................................................................. 8 Krieger v. Atheros Communications, Inc., 776 F. Supp. 2d 1053 (N.D. Cal. 2011) ......................................................... 13, 18 Leek v. Cooper, 194 Cal. App. 4th 399 (2011) .............................................................................. 12 Lovesy v. Armed Forces Ben. Ass’n, No. C 07-2745 SBA, 2008 WL 696991 (N.D. Cal. Mar. 13, 2008) ............. 12, 13 Martinez v. Combs, 49 Cal. 4th 35 (2010) ............................................................................................. 9 Melt Franchising, LLC v. PMI Enterprises, Inc., No. CV 08-4148 PSG, 2008 WL 4811097 (C.D. Cal. Oct. 27, 2008) ................ 15 Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 6 of 29 Page ID #:117 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 iv 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) Mesler v. Bragg Management Co., 39 Cal. 3d 290 (1985) .......................................................................................... 12 Morisada Corp. v. Beidas, 939 F. Supp. 732 (D. Haw. 1995) ....................................................................... 19 Moses H. Cone Mem. Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (1983) ................................................................................................ 16 Nakash v. Marciano, 882 F.2d 1411 (9th Cir. 1989) ....................................................................... 14, 15 Neilson v. Union Bank of California, NA, 290 F. Supp. 2d 1101 (C.D. Cal. 2003) ............................................................... 12 R.R. Street & Co. v. Transport Ins. Co., 656 F.3d 966 (9th Cir. 2011) ............................................................................... 18 Revolon Monterey Energy LLC v. Peak Operator LLC, No. 13-7048 PSG (MRW), 2013 WL 12123689 (C.D. Cal. Dec. 27. 2013) ................................................................................................................ 3, 13 Reynolds v. Bement, 36 Cal. 4th 1075 (2005) ....................................................................................... 10 U.S. ex rel Robinson Rancheria Citizens Council v. Borneo, Inc., 971 F.2d 244 (9th Cir. 1992) ................................................................................. 3 Romine v. Compuserve Corp., 160 F.3d 337 (6th Cir. 1998) ............................................................................... 16 Rubin v. Wal-Mart Stores, Inc., 599 F. Supp. 2d 1176 (N.D. Cal. 2009) ................................................................. 8 ScripsAmerica, Inc. v. Ironridge Global, LLC, 56 F. Supp. 3d 1121 (C.D. Cal. 2014) ................................................................... 3 Sea Prestigo, LLC v. M/Y Triton, 787 F. Supp. 2d 1116 (S.D. Cal. 2011) ......................................................... 17, 19 Sonora Diamond Corp. v. Super. Ct., 83 Cal. App. 4th 523 (2000) ................................................................................ 12 Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 7 of 29 Page ID #:118 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 v 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) Travelers Indem. Co. v. Madonna, 914 F.2d 1364 (9th Cir. 1990) ....................................................................... 17, 19 United States v. Bestfoods, 524 U.S. 51 (1998) .............................................................................................. 11 Vernon v. State, 116 Cal. App. 4th 114 (2004) .............................................................................. 10 Warren v. Fox Family Worldwide, Inc., 328 F.3d 1136 (9th Cir. 2003) ............................................................................... 3 Wehlage v. EmpRes Healthcare, Inc., 791 F. Supp. 2d 774 (N.D. Cal. 2011) ................................................................. 12 Yahoo! Inc. v. La Zigue Contre Le Racisme et L’An, 379 F.3d 1120 (9th Cir. 2004) ............................................................................. 14 STATUTES AND RULES Cal. Bus. & Prof. Code § 17200 et seq. ............................................................ passim Cal. Code Regs., Title 8, § 11040 ......................................................................... 9, 10 Cal. Lab. Code § 201 ............................................................................................ 7, 15 Cal. Lab. Code § 201(a) ............................................................................................ 10 Cal. Lab. Code § 202 ............................................................................................ 7, 15 Cal. Lab. Code § 226 ........................................................................................ 7, 8, 15 Cal. Lab. Code § 226.7 ................................................................................... 9, 14, 15 Cal. Lab. Code § 510 .......................................................................................... 14, 15 Cal. Lab. Code § 512 ................................................................................................ 14 Cal. Lab. Code § 1174 .............................................................................................. 15 Cal. Lab. Code § 1175 .............................................................................................. 15 Cal. Lab. Code § 1194 .......................................................................................... 9, 14 Cal. Lab. Code § 1198 .............................................................................................. 14 Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 8 of 29 Page ID #:119 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 vi 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) Fed. R. Civ. P. 8(a) ..................................................................................................... 4 Fed. R. Civ. P. 12(b)(1) ................................................................................ 1, 3, 4, 13 Fed. R. Civ. P. 12(b)(6) ...................................................................................... 1, 4, 6 Fed. R. Ev. Rule 201 ................................................................................................... 3 Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 9 of 29 Page ID #:120 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 1 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) MEMORANDUM OF POINTS AND AUTHORITIES Defendants Fresenius Medical Care North America Holdings Limited Partnership (“Fresenius Holdings LP”), wrongfully named in this action as Fresenius Medical Care North America Limited Partnership, Bio-Medical Applications of California, Inc. (“Bio-Medical Applications”), Renal Advantage Inc. (“Renal Advantage”), Fresenius Medical Care - Eucalyptus, LLC (“Eucalyptus”), and Fresenius Medical Care Goldenwest, LLC (“Goldenwest”) (all collectively, “Defendants”), respectfully request an order dismissing Plaintiff Mariter Roldan (“Plaintiff”)’s Complaint1 for failure to state a claim upon which relief may be granted pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, or, in the alternative, to dismiss or stay these proceedings in light of a previously filed, substantially similar class action pending in California Superior Court in the County of San Diego, captioned Yolanda Gonzales et al. v. Fresenius Medical Care Holdings et al., Case No. 37-2013-00072469-CU-OE-CTL (the “San Diego Action”), under the Colorado River doctrine pursuant to Rule 12(b)(1). I. PRELIMINARY STATEMENT Through a text-book example of conclusory pleading, Plaintiff seeks to hold Defendants liable for various putative violations of California wage and hour laws. But Plaintiff’s Complaint is defective on its face, offering only a rote recitation of the elements of Plaintiff’s seven causes of action without pleading any actual facts. It is because the Complaint lacks any factual allegations that it fails to state a claim upon which relief may be granted, and should be dismissed. In the alternative, this action should be dismissed or stayed under the Colorado River doctrine in deference to the parallel San Diego Action. 1 Pursuant to this Court’s January 1, 2010 Initial Order Following Filing of Complaint Assigned to Judge Selna, a copy of Plaintiff’s Complaint is attached hereto as Exhibit A. Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 10 of 29 Page ID #:121 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 2 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) II. BACKGROUND On April 27, 2017, Plaintiff filed the above-captioned putative class action, alleging violations of California wage and hour laws related to Defendants’ purported overtime, meal and rest break, and payroll policies and practices, in California Superior Court in the County of Los Angeles. (Docket Entry (“DE”) 1-1 (Compl.); see also Exhibit A attached hereto.) Defendants timely removed this action to federal district court on June 12, 2017. (DE 1 (Notice of Removal).) In her Complaint, Plaintiff asserts she has been and currently is employed by Defendants - collectively - since at least May 2013 as a non-exempt employee, although she never establishes in the Complaint which of the Defendants actually employed her and when, or which of the Defendants operated and controlled the three locations - Tustin, Inglewood, and Westminster - she alleges having worked at. (DE 1-1 (Compl.) ¶ 10.) In describing each of the Defendants, Plaintiff alleges that Defendants Bio- Medical Applications, Renal Advantage, Eucalyptus, and Goldenwest are the agents and alter egos of Fresenius Holdings LP, and that, because of this agency and alter ego relationship, all Defendants constitute a joint enterprise and were and are Plaintiff’s joint employers. (DE 1-1 (Compl.) ¶¶ 17-22.) The Complaint, however, provides no factual allegations or examples of how the Defendants, and each of them, act as agents or alter egos of Fresenius Holdings LP or one another. (Id.) Plaintiff further alleges that, during her time period of employment, she “routinely work[ed] over eight (8) hours per day or forty (40) hours per week.” (Id. ¶ 25.) Plaintiff now contends that she was not properly compensated for work performed during her period of employment. (Id. ¶¶ 25-31.) In the Complaint, Plaintiff asserts seven causes of action, all premised on various theories of liability stemming from alleged violations of California wage and hour laws: (1) failure to pay overtime wages; (2) failure to provide meal Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 11 of 29 Page ID #:122 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 3 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) periods; (3) failure to provide rest periods; (4) failure to pay all wages due upon ending of employment; (5) failure to provide accurate itemized wage statements; (6) failure to indemnify employees for all necessary expenditures, including mileage on their personal vehicles; and (7) unfair business practices in violation of Cal. Bus. & Prof. Code § 17200. (DE 1-1 (Compl.) ¶¶ 42-91.) Almost four years before Plaintiff filed her Complaint, a similar class action was filed in San Diego Superior Court alleging nearly identical violations of California wage and hour laws against Fresenius-affiliated vascular and dialysis entities in California, captioned Yolanda Gonzales et al. v. Fresenius Medical Care Holdings et al., Case No. 37-2013-00072469-CU-OE-CTL. (Request for Judicial Notice (“RJN”) Ex. 1 (San Diego Action Docket).)2 After undergoing much motion practice, which included multiple challenges to and amendments of the complaint, adding an additional named plaintiff, the entering of a protective order, and removal and remand of the action, the San Diego Action is in the midst of class discovery. (RJN Ex. 1 (San Diego Action Docket), Ex. 2 (San Diego Action Operative Complaint (Second Am. Compl.)), Ex. 3 (Aug. 1, 2014 Minute Order re: Motion for Protective Order), Ex. 4 (Notice of Remand to State Court & Denial of Defs.’ Pet. for Appeal); Declaration of David Stern (“Stern Decl.”) ¶¶ 2-7.)3 III. ARGUMENT This Action should be dismissed for failure to state a cognizable claim under Rule 12(b)(6) or, in the alternative, dismissed or stayed in deference to the San Diego Action under the Colorado River doctrine pursuant to Rule 12(b)(1). 2 A court may properly take judicial notice of court filings in concurrent state courts when determining whether to stay proceedings under the Colorado River doctrine. See, e.g., U.S. ex rel Robinson Rancheria Citizens Council v. Borneo, Inc.¸971 F.2d 244, 248 (9th Cir. 1992); ScripsAmerica, Inc. v. Ironridge Global, LLC, 56 F. Supp. 3d 1121, 1135-36 (C.D. Cal. 2014); see also Fed. R. Ev. Rule 201. 3 When “ruling on a 12(b)(1) jurisdictional challenge, a court may look beyond the complaint and consider extrinsic evidence.” Warren v. Fox Family Worldwide, Inc., 328 F.3d 1136, 1141 n.5 (9th Cir. 2003); Revolon Monterey Energy LLC, 2013 WL 12123689 at *1. The Stern Declaration may therefore be relied upon when determining to dismiss or stay under Colorado River pursuant to Rule 12(b)(1). Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 12 of 29 Page ID #:123 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 4 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) A. Plaintiff’s Conclusory Complaint Fails Under Rule 12(b)(6). Plaintiff offers this Court a form Complaint, heavy on conclusory assertions but devoid of factual allegations. Indeed, the Complaint is nearly bereft of any factual allegations specific to either Plaintiff or Defendants, relying instead on a formulaic recitation of causes of action and legal conclusions in an effort to cover the waterfront of California wage and hour claims. Such rote pleading is insufficient and fails as a matter of law under the pleading standard established in Ashcroft v. Iqbal, 556 U.S. 662, 683 (2009). Plaintiff offers only conclusory allegations of non-compliance with California labor laws while inadequately invoking joint employer liability against Defendants based on conclusory agency and alter ego allegations. 1. Dismissal Standard under Rule 12(b)(6). When determining the sufficiency of a complaint under Rule 8(a), the court must determine whether or not the factual allegations in the complaint suffice to move the claims “across the line from conceivable to plausible.” Iqbal, 556 U.S. at 683. Merely asserting facts consistent with a defendant’s liability or a “formulaic recitation of the elements of a cause of action” is patently insufficient. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007); see Iqbal, 556 U.S. at 678 (“[T]he pleading standard Rule 8 announces . . . demands more than an unadorned, the- defendant-unlawfully-harmed-me accusation.”). “Nor does a complaint suffice if it tenders ‘naked assertions’ devoid of ‘factual enhancement.’” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557). Instead, the complaint must state “enough fact[s] to raise a reasonable expectation that discovery will reveal evidence of [the misconduct alleged].” Twombly, 550 U.S. at 556; see Iqbal, 556 U.S. at 678-79 (“Rule 8 . . . does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions.”). A court need not accept as true “allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences.” In re Gilead Scis. Sec. Litig., 536 F.3d 1049, 1055 (9th Cir. 2008). Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 13 of 29 Page ID #:124 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 5 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) Where, as here, “the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged - but it has not ‘shown’ - ‘that the pleader is entitled to relief.”’ Iqbal, 556 U.S. at 679 (quoting Fed. R. Civ. Pro. 8(a)(2)); see Twombly, 550 U.S. at 555. 2. Plaintiff Inadequately Pleads Liability. The Complaint presents seven causes of action without ever articulating any factual theory of liability beyond the mere recitation of the very statutes allegedly violated. These include causes of action based on direct violation of California labor laws, including (1) the failure to pay overtime wages; (2) the failure to provide meal periods; (3) the failure to provide rest periods; and (4) the failure to indemnify employees for all necessary expenditures, including mileage on their personal vehicles, as well as “derivative” causes of action stemming from these direct liability claims, including (5) the failure to pay all wages due upon ending of employment; (6) the failure to provide accurate itemized wage statements; and (7) unfair business practices in violation of Cal. Bus. & Prof. Code § 17200. (DE 1-1 (Compl.) ¶¶ 42-91.) But because the Complaint only provides a “formulaic recitation of the elements of [each] cause of action”, both the “direct” and “derivative” causes of action are subject to dismissal. Twombly, 550 U.S. at 555. a. Plaintiff’s “Direct” Causes of Action are Pleaded in Conclusory Fashion. For Plaintiff’s “direct” causes of action for (1) failure to pay overtime, (2) failure to provide meal periods, (3) failure to provide rest period, and (4) failure to indemnify employees for mileage, the Complaint never offers any factual support to the conclusory allegations of liability. Indeed, the absence of the requisite factual hook on which to hang the inferred liability renders the Complaint insufficient under Rule 12(b)(6). See Iqbal, 556 U.S. at 678; In re Gilead Scis. Sec. Litig., 536 F.3d at 1055. Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 14 of 29 Page ID #:125 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 6 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) For example, the Complaint alleges - in conclusory fashion - that Defendants have a “consistent policy of failing to pay overtime wages . . . in violation of California state wage and hour laws as a result of . . . employees routinely working over eight (8) hours per day or forty (40) hours per week due to . . . failing to include all forms of remuneration to calculate the regular rate of pay for overtime purposes.” (DE 1-1 (Compl.) ¶ 25.) But nowhere does the Complaint offer any factual allegations in support of this recitation of the elements of the cause of action for failing to provide overtime pay; nowhere are facts pleaded setting out a theory of what acts or omissions perpetrated by Defendants constituted the policy and practice that lead to the alleged failure to pay overtime wages. Rather, the cause of action itself is a rehash of these same conclusory allegations, merely parroting the elements of the cause of action. (Compare id. ¶ 25 with id. ¶¶ 43-45.) Similarly, the Complaint offers no facts in support of its allegations that meal and rest periods were not provided. Other than the conclusory assertion that Defendants “had a consistent policy or procedure” of failing to provide compliant meal and rest periods, the Complaint never articulates any facts describing the alleged policy or procedure that led to the alleged violations, let alone in what form the violations were manifested (i.e., were meal or rest periods not provided at all, were the meal or rest periods improperly interrupted, were the meal or rest periods improperly short, etc.). (See id. ¶¶ 26-28, 48-51, 55-58.) It is patently inadequate to allege that meal and rest periods were not provided in violation of the law, but then fail to include a factual theory for how the violation occurred. Iqbal, 556 U.S. at 678 (“Nor does a complaint suffice if it tenders ‘naked assertions’ devoid of ‘factual enhancement.’”) (quoting Twombly, 550 U.S. at 557). Plaintiff’s allegation about failing to be reimbursed for mileage fairs no better, as it, too, is pleaded without sufficient facts to move the claim from supporting only an inference of “the mere possibility of misconduct” to having “shown that the pleader is entitled to relief.” Iqbal, 556 U.S. at 679 (quoting Fed. Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 15 of 29 Page ID #:126 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 7 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) R. Civ. Pro. 8(a)(2)); see Twombly, 550 U.S. at 555; (DE 1-1 (Compl.) ¶¶ 31, 81- 85). b. Plaintiff’s “Derivative” Claims Also Fail. Given the fatally conclusory nature of Plaintiff’s “direct” claims, Plaintiff’s “derivative” claims for waiting time penalties, failure to provide accurate wage statements, and violations of California Business & Professions Code §17200 et seq. (“UCL”), fail as well. Plaintiff’s claim for waiting time violations pursuant to Cal. Labor Code §§ 201, 202, and 203 hinges on Defendants’ purported failure to pay adequate wages pursuant to Plaintiff’s first three causes of action. (See DE 1-1 (Compl.) ¶ 64 (“[A]t all relevant times within the applicable limitations period, Defendants had a practice of not paying upon termination or resignation, the wages owed . . . as a consequence of, among other things, overtime hours worked.”).) Because the legal theories for liability for the first three causes of action are patently insufficient to state a proper claim, this derivative claim must also be dismissed. Similarly, to the extent Plaintiff’s claim for inaccurate wage statements pursuant to Cal. Labor Code § 226 is premised on inaccurate wage information due to Defendants’ purported overtime and meal and rest break violations (see DE 1-1 (Compl.) ¶ 75 (“Defendants maintained and continue to maintain a policy and practice of issuing wage statements that do not show, among other things, pay due and owing for all hours worked, including overtime hours worked, pay due and owing for meal and rest break law violations, and all applicable hourly rates in effect during the pay periods.”)), this claim is derivative of, and must be dismissed with, Plaintiff’s predicate overtime and meal and rest break violation claims. Moreover, Plaintiff fails to offer any factual allegations to support her inaccurate wage statement claim, once again providing only a rote recitation of the law and Defendants alleged “policy and practice” of non-compliance. (See id. ¶¶ 73-75.) Such “conclusory statements are not sufficient to state a cause of action upon which Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 16 of 29 Page ID #:127 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 8 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) relief may be granted” under Section 226. Gutierrez v. Aaron’s Inc., No. 2:10-cv- 02417-MCE-EFB, 2010 WL 4968142, at *3 (E.D. Cal. Dec. 1, 2010) (dismissing Section 226 claim where plaintiff merely “provide[d] a recitation of the applicable law followed by a legal conclusion referencing Defendant”). Plaintiff’s claim for unfair competition also fails because it, too, is entirely derivative of her other claims for violation of the California Labor Code. (See DE 1-1 (Compl.) ¶ 88 (“The unlawful conduct of Defendants alleged herein constitutes unfair competition within the meaning of Business and Professions Code section 17200.”).) Because Plaintiff's claims for the underlying violations fail as explained supra, she cannot state a claim under Section 17200. See Briosos v. Wells Fargo Bank, 737 F. Supp. 2d 1018, 1033 (N.D. Cal. 2010) (“Because Plaintiff has failed to state claims for any underlying violation of state or federal law, he cannot proceed on his unfair competition law claim under § 17200.”); see also Rubin v. Wal-Mart Stores, Inc., 599 F. Supp. 2d 1176, 1179 (N.D. Cal. 2009) (holding employee’s UCL claim against employer was derivative of erroneous claims for violations of California labor law provisions governing overtime pay, precluding UCL cause of action); Krantz v. Bt Visual Images, 89 Cal. App. 4th 164, 178 (2001) (where a UCL claim is entirely derivative of another cause of action, it stands or falls with the underlying claim). 3. Plaintiff Fails To Allege Any Facts To Support Her Conclusory Allegations of Agency and Alter Ego Liability. Plaintiff fails to plead any facts establishing Fresenius Holdings LP - a parent entity far removed from the other Defendants (see DE 3 (Notice of Interested Parties) - as a viable defendant for her California wage and hour-based causes of action. Indeed, the conclusory nature of the Complaint omits any specific factual allegations sufficient to establish liability by Fresenius Holdings LP - or the other named Defendants - as either (a) direct California employers of Plaintiff or (b) alter egos of each other. Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 17 of 29 Page ID #:128 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 9 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) a. Plaintiff Does Not Allege Facts Sufficient To Show That Fresenius Holdings LP - Or The Other Named Defendants - Are Her Employers Under California Labor Law. Each of Plaintiff’s causes of action against Fresenius Holdings LP - and the other named Defendants - is predicated on showing a California employer- employee relationship between Plaintiff and each of the Defendants. See, e.g., Cal. Lab. Code § 226.7 (only an “employer” is liable for failing to provide an employee with meal or rest periods); Cal. Lab. Code § 1194 (only an “employee” may bring an action to recover unpaid overtime compensation). In Martinez v. Combs, 49 Cal. 4th 35 (2010), the California Supreme Court held that, when determining whether an entity is an employer subject to Labor Code § 1194 and various other Labor Code provisions, one must look to the language of the applicable Industrial Welfare Commission (IWC) Wage Order. Id. at 63-65. Here, the relevant Wage Order defines “employer” as one “who directly or indirectly, or through an agent or any other person, employs or exercises control over the wages, hours, or working conditions of any person.” Cal. Code Regs., tit. 8, § 11040 (“Professional, Technical, Clerical, Mechanical and Similar Occupations”), subd. (2)(H). Accordingly, Plaintiff has the burden at the pleading stage to establish, through facts and not legal conclusions, that each of the named Defendants, including Fresenius Holdings LP, was her employer - i.e., that they “employ[ed] or exercise[ed] control over [her] wages, hours, or working conditions,” see id. - during each period for which she alleges Labor Code violations by Defendants. See, e.g., Reynolds v. Bement, 36 Cal. 4th 1075, 1087-88 (2005) (sustaining demurrer where plaintiff failed to allege facts sufficient to establish an employee- employer relationship under the relevant definition) (overruled on other grounds by Martinez, 49 Cal. 4th 35); see also Bowes v. Christian Record Services, No. CV 11- 799-CAS (DTBx), 2011 WL 3682766, at *3 (C.D. Cal. Aug. 22, 2011) (dismissing Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 18 of 29 Page ID #:129 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 10 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) California wage and hour claims based on conclusory allegations of an employment relationship that were belied by the face of the complaint); Baker v. Chin & Hensolt, Inc., No. C-09-4168 MMC, 2010 WL 1222783, at *4 (N.D. Cal. Mar. 24, 2010) (dismissing claim for waiting time violations under California Labor Code because plaintiff failed to sufficiently allege facts to support a finding that defendant was plaintiff’s “employer”) (citing Cal. Lab. Code § 201(a)). Any valid claim based on California wage and hour laws against a putative employer-defendant must therefore assert facts on which to draw the inference of control over the putative employee-plaintiff. See Vernon v. State, 116 Cal. App. 4th 114, 132 (2004). But a plaintiff’s “general statement that [a defendant] exercised control over their day-to-day employment is a conclusion, not a factual allegation stated with any such specificity,” and the Court “need not accept [this] unwarranted conclusion in reviewing a motion to dismiss.” Doe v. Wal-Mart Stores, Inc., 572 F.3d 677, 683 (9th Cir. 2009) (emphasis added). Here, Plaintiff merely alleges that “[a]t all relevant times herein, Plaintiff is informed and believes, and based thereon alleges that Defendants employed her as a non-exempt employee” and that Fresenius Holdings LP “dominated and controlled” all of the other Defendants, who were and are mere “alter egos” of Fresenius Holdings LP. (DE 1-1 (Compl.) ¶¶ 17-22.) Her Complaint rests on pure legal conclusions and lacks any facts that would establish true day-to-day control by Fresenius Holdings LP - or the other named Defendants - over “the manner and method in which the work is performed.” Doe, 572 F.3d at 682. Nor does the Complaint assert any facts establishing Fresenius Holdings LP’s role in California as Plaintiff’s employer, or that Plaintiff, who is an alleged resident of California, was actually employed in California by Fresenius Holdings LP. Rather, the Complaint offers only the conclusory and vague allegations that “Defendants employed [Plaintiff] as a non-exempt employee - namely, a registered nurse - since at least May of 2013 through the present, during which Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 19 of 29 Page ID #:130 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 11 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) she worked, at among other locations, their Tustin, Inglewood and Westminster locations.” (DE 1-1 (Compl.) ¶ 10.) Nowhere does the Complaint set forth any facts connecting which of the Defendants employed Plaintiff at which location, instead relying on a conclusory allegation that Plaintiff worked for all of the identified Defendants, apparently simultaneously, at all three identified locations. Such factually hollow allegations are patently insufficient under Iqbal/Twombley. b. Plaintiff Does Not Sufficiently Allege That Fresenius Holdings LP Is Liable Under An Alter Ego Theory. Not only does Plaintiff not establish Fresenius Holdings LP (or the other named Defendants) as California employers of Plaintiff, Plaintiff never establishes a factual basis on which to hold Fresenius Holdings LP liable, even under an alter ego theory as a non-employer. It is hornbook law that a parent corporation or owner is not liable for the acts of its subsidiaries. United States v. Bestfoods, 524 U.S. 51, 61 (1998). Under California law, corporate entities are presumed to have separate existences, and the corporate form should only be disregarded when the ends of justice so require. Mesler v. Bragg Management Co., 39 Cal. 3d 290, 300 (1985); Leek v. Cooper, 194 Cal. App. 4th 399, 411 (2011). While the corporate veil may be pierced when the corporation is the alter ego of a controlling shareholder, alter ego liability requires (1) “a unity of interest and ownership between the corporation and its equitable owner that the separate personalities of the corporation and the shareholder do not in reality exist” and (2) “an inequitable result if the acts in question are treated as those of the corporation alone.” Sonora Diamond Corp. v. Super. Ct., 83 Cal. App. 4th 523, 538 (2000). To pursue this theory of liability, Plaintiff must allege facts sufficient to establish the elements of the alter ego doctrine; conclusory allegations are insufficient. Hokama v. E.F. Hutton & Co., Inc., 566 F. Supp. 636, 647 (C.D. Cal. 1983); see also Neilson v. Union Bank of California, NA, 290 F. Supp. 2d 1101, Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 20 of 29 Page ID #:131 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 12 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) 1116 (C.D. Cal. 2003) (“Conclusory allegations of ‘alter ego’ status are insufficient to state a claim. Rather, a plaintiff must allege specifically both of the elements of alter ego liability, as well as facts supporting each.”) (emphasis added); Lovesy v. Armed Forces Ben. Ass’n, No. C 07-2745 SBA, 2008 WL 696991, at *4 (N.D. Cal. Mar. 13, 2008) (“At a minimum,” a plaintiff “must set forth sufficiently specific factual allegations to support an alter ego claim in order to overcome a motion to dismiss.”) (internal quotations omitted); Wehlage v. EmpRes Healthcare, Inc., 791 F. Supp. 2d 774, 782-83 (N.D. Cal. 2011) (dismissing claims based on alter ego liability because the broad allegations were “not sufficient to show a unity of interest and ownership”). Nowhere in the Complaint does Plaintiff allege facts supportive of the elements of the alter ego doctrine. Indeed, Plaintiff merely recites the elements of alter ego and then alleges - in conclusory fashion - that Fresenius Holdings LP meets each of these elements and is therefore the alter ego of the other named Defendants. (DE 1-1 (Compl.) ¶ 20(a)-(e).) But such boilerplate allegations are insufficient to withstand a motion to dismiss. See Lovesy, 2008 WL 696991, at *4 (holding similar “conclusory recitation” that certain defendants were the “agent, servant, employee, successor, assign, or alter ego” of other defendants to be insufficient to plead alter ego liability). Rather, “[i]n order to withstand a motion to dismiss, [Plaintiff] must, at a minimum, set forth some examples of alleged domination” by the alleged alter ego entity. Id. (internal quotations omitted) (emphasis added). Plaintiff fails to do so, and therefore has failed to plead facts implicating Fresenius Holdings LP as a viable defendant as an alter ego employer. B. This Action Should Be Dismissed or Stayed Under the Colorado River Doctrine Pursuant to Rule 12(b)(1) to Further the Interests of Wise Judicial Administration. “Under the Colorado River doctrine, a federal court may abstain from exercising its jurisdiction in favor of parallel state proceedings where doing so Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 21 of 29 Page ID #:132 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 13 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) would serve the interests of ‘wise judicial administration, giving regard to the conservation of judicial resources and comprehensive disposition of litigation.’” Krieger v. Atheros Communications, Inc., 776 F. Supp. 2d 1053, 1057 (N.D. Cal. 2011) (quoting Colorado River Water Conservation Dist. v. United States, 424 U.S. 800, 818 (1976)). A motion to dismiss or stay under the Colorado River doctrine may properly be brought pursuant to Rule 12(b)(1). Revolon Monterey Energy LLC v. Peak Operator LLC, No. 13-7048 PSG (MRW), 2013 WL 12123689, at *1 (C.D. Cal. Dec. 27. 2013) (“Rule 12(b)(1) . . . allows a defendant to move for a stay or dismissal of an action pursuant to the . . . Colorado River abstention doctrine[].”); see Equity Lifestyle Properties, Inc. v. Cnty. of San Luis Obispo, 548 F.3d 1184, 1188 (9th Cir. 2008). Where two concurrent cases are deemed sufficiently “parallel,” a district court may weigh seven different Colorado River factors to determine if dismissing or staying the federal action is appropriate. Each is addressed in turn. 1. The Class Claims in the San Diego Action Are Sufficiently Similar to the Class Claims in this Action to Justify Dismissing or Staying this Action. “As a threshold matter to the Colorado River test, the Court must determine whether the federal and state actions are sufficiently ‘parallel’-i.e. whether substantially the same parties are contemporaneously litigating the same issues in different forums.” In re Countrywide Fin. Corp. Derivative Litig., 542 F. Supp. 2d 1160, 1170 (C.D. Cal. 2008) (internal quotes and citations omitted); see also Yahoo! Inc. v. La Zigue Contre Le Racisme et L’An, 379 F.3d 1120, 1138 (9th Cir. 2004); El Centro Foods, Inc. v. Nazarian, No. CV09-06395 ODW, 2010 WL 1710286, at *2 (C.D. Cal. Apr. 21, 2010); Enfission, Inc. v. Leaver, 408 F. Supp. 2d 1093, 1096 (W.D. Wash. 2005). “Exact parallelism” is not required; rather the two Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 22 of 29 Page ID #:133 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 14 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) proceedings need only be shown to be “substantially similar.” Nakash v. Marciano, 882 F.2d 1411, 1416 (9th Cir. 1989). Here, it is beyond doubt that resolving the state court proceedings in the San Diego Action will substantially, if not completely, resolve this litigation because both actions cover substantially the same California wage and hour claims by Fresenius-affiliated California dialysis centers’ non-exempt employees. (Compare DE 1-1 (Compl.) with RJN Ex. 2 (San Diego Action Operative Complaint).) The San Diego Action asserts class claims on behalf of all California non-exempt employees and former employees of Fresenius-affiliated dialysis clinics, allegedly from October 12, 2008 through the present, for, inter alia, (1) failure to pay all wages and overtime wages (Cal. Labor Code §§ 510, 1194, 1198); (2) failure to provide meal periods (Cal. Labor Code §§ 226.7, 512); (3) failure to pay accurate itemized wage statements (Cal. Labor Code §§ 226, 1174, 1175); (5) failure to pay all wages due upon ending of employment (Cal. Labor Code §§ 201-203); and (6) unfair business practices (Cal. Bus. & Prof. Code §17200). (RJN Ex. 2 (San Diego Action Operative Complaint).) The class claims asserted in the current action are nearly identical, although covering a shorter class period. (See DE 1-1 (Compl.) ¶¶ 42-91 (asserting class claims for, inter alia, (1) failure to pay overtime wages (Cal. Labor Code §510); (2) failure to provide meal periods (Cal. Labor Code § 226.7); (3) failure to provide rest periods (Cal. Labor Code § 226.7); (4) failure to pay all wages due upon ending of employment (Cal. Labor Code §§ 201-203); (5) failure to provide accurate itemized wage statements (Cal. Labor Code § 226); and (6) unfair business practices (Cal. Bus. & Prof. Code § 17200)).) The only potential non-identical claim is Plaintiff’s claim for mileage reimbursement (DE 1-1 (Compl.) ¶¶ 80-86), but this one claim is not sufficient to destroy the “parallel” nature of both actions nor the fact that all of Plaintiff’s other class claims are completely subsumed by the class claims pending in the San Diego Action. See Nakash, 882 F.2d at 1416; Melt Franchising, LLC v. PMI Enterprises, Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 23 of 29 Page ID #:134 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 15 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) Inc., No. CV 08-4148 PSG (MANx), 2008 WL 4811097, at *2 (C.D. Cal. Oct. 27, 2008) (even where claims are not completely overlapping, actions may be deemed “substantially similar” such that “the state court litigation provides an adequate vehicle for resolution of . . . claims”). In addition, the San Diego Action Complaint specifically identifies the very dialysis clinics identified in Plaintiff’s Complaint - Eucalyptus and Goldenwest - as clinics that fall within the San Diego Action’s class claims. (See RJN Ex. 2 (San Diego Action Operative Complaint) at 6:16, 7:8.) Plaintiff is therefore already a member of the putative class represented in the San Diego Action, demonstrating the “parallel” nature of both proceedings. Nor does the fact that different named plaintiffs appear in this and the San Diego Action alter the analysis because the members of the class are substantially the same, and that is sufficient. See In re Countrywide, 542 F. Supp. 2d at 1170 (“Though the named plaintiffs are different, ‘where . . . congruence of both interests and allegations exists in duplicative class actions, the nonidentity of the named class representatives should in no way undermine a court’s determination that the suits in question are otherwise parallel.’”) (quoting Romine v. Compuserve Corp., 160 F.3d 337, 340 (6th Cir. 1998)). 2. The Colorado River Factors Weigh in Favor of Dismissing or Staying this Action. While the Colorado River doctrine is a “narrow exception” that applies only where “exceptional circumstances” are present, Holder v. Holder, 305 F.3d 854, 867 (9th Cir. 2002), Colorado River and its progeny establish seven non-exclusive factors relevant to whether or not a case should be dismissed or stayed under the doctrine once the “parallel” nature of the concurrent action is sufficiently established: (1) whether the state court first assumed jurisdiction over property; (2) inconvenience of the federal forum; (3) the desirability of avoiding piecemeal litigation; (4) the order in which jurisdiction was obtained by the concurrent Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 24 of 29 Page ID #:135 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 16 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) forums; (5) whether federal law or state law provides the rule of decision on the merits; (6) whether the state court proceedings are inadequate to protect the federal litigant’s rights; and (7) whether exercising jurisdiction would promote forum shopping. See Colorado River, 424 U.S. at 818; Moses H. Cone Mem. Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 15-16 (1983) (superseded by statute on other grounds); Holder, 305 F.3d at 870. “The weight to be given any one factor may vary greatly from case to case,” but the balance is “heavily weighted in favor of the exercise of jurisdiction.” Cone, 460 U.S. at 16. Here, the relevant4 Colorado River factors weigh in favor of dismissing or staying this action in deference to the San Diego Action. First, the threat of piecemeal litigation favors dismissal or a stay when “different tribunals consider the same issue, thereby duplicating efforts and possibly reaching different results.” Travelers Indem. Co. v. Madonna, 914 F.2d 1364, 1369 (9th Cir. 1990). Here, the duplication of efforts by this Court and the state court in the San Diego Action, coupled with the risk of differing results, weighs strongly in favor of granting a stay. See, e.g., Canopus Biopharma, Inc. v. Supportive Therapeutics, LLC, No.CV15-9439 PSG (DTBx), 2016 WL 7438795, at *3 (C.D. Cal. Mar. 25, 2016) (the desirability of avoiding piecemeal litigation factor “weighs heavily in favor of granting the stay because resolution of both the [state court] action and this case depend on a determination of the same questions”); El Centro Foods, Inc., 2010 WL 1710286 at *3 (staying federal action to prevent duplication of efforts and risk of inconsistent outcomes, as well as respecting federal-state comity). Moreover, “to allow this case to proceed alongside the [San Diego Action] would not only promote piecemeal litigation, it could also result in debilitating confusion if, for example, putative class members were to receive two different 4 “The factors relevant to a given case are subjected to a flexible balancing test, in which one factor may be accorded substantially more weight than another depending on the circumstances of the case . . . .” Holder, 305 F.3d at 870. Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 25 of 29 Page ID #:136 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 17 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) notices, from two different courts, covering the same claims.” Clarke v. First Transit, Inc., Case No. CV 07-6476 GAF (MANx), 2008 WL 11281125, *4-5 (C.D. Cal. Feb. 7, 2008) (granting stay where second-filed action asserted near-identical California wage and hour class claims as earlier filed state court action); see also Sea Prestigo, LLC v. M/Y Triton, 787 F. Supp. 2d 1116, 1119 (S.D. Cal. 2011) (“staying the case would eliminate the possibility of the state and federal courts both deciding, and possibly reaching inconsistent conclusions”); Canopus Biopharma, Inc., 2016 WL 7438795 at*3 (“the risk of inconsistent and redundant litigation weighs in favor of granting a stay here”). Second, the San Diego Action preceded this action by, and has been pending for, nearly five years. (RJN Ex. 1 (San Diego Action Docket); Stern Decl. ¶¶ 2-3.) “It is settled that the court first assuming jurisdiction over a matter ‘may exercise that jurisdiction to the exclusion of other courts.’” El Centro Foods, Inc., 2010 WL 1710286 at *3 (quoting Colorado River, 424 U.S. at 418). In addition, where the first-filed action has made substantial progress, as is the case here with the San Diego Action, this factor also weighs heavily in favor of granting dismissal or a stay. See, e.g., R.R. Street & Co. v. Transport Ins. Co., 656 F.3d 966, 980 (9th Cir. 2011) (concluding state court’s “significant progress” toward resolution of dispute weighed against exercise of jurisdiction); Am. Int’l Underwriters (Philippines), Inc. v. Continental Ins. Co., 843 F.2d 1253, 1258 (9th Cir. 1988) (state court proceedings had made substantive progress, including deciding several motions, and the parties had conducted some discovery, in contrast to the federal action, which had not yet progressed); Krieger, 776 F. Supp. 2d at 1062 (factors weighing in favor of staying federal court action included that state court action was filed first and had progressed by entering protective order and completion of an initial round of discovery). Indeed, the court in the San Diego Action has already resolved multiple challenges to the pleadings, issued a protective order resolving class discovery disputes, the case has been removed and Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 26 of 29 Page ID #:137 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 18 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) remanded, the parties are engaged in class discovery, and have been negotiating the scope and breadth of a Belaire-West notice to the nearly 6,000 putative class members. (See Stern Decl. ¶¶ 4-7; RJN Exs. 1-4.) Third, the merits of the overlapping class claims in both this action and the San Diego Action will be determined by the application of California law, not federal law. While the fact that state law controls diminishes the importance of this factor, the factor nonetheless supports dismissal or issuing a stay. See Cerit v. Cerit, 188 F. Supp. 2d 1239, 1250 (D. Haw. 2002) (“[W]here state law issues predominate, the source of law is of diminished importance.”) (citing Johns v. Rozet, 770 F. Supp. 11, 16 (D.D.C. 1991)); but see Canopus Biopharma, Inc., 2016 WL 7438795 at*4 (“Where state law issues predominate, ‘granting the stay is consistent with the federal court’s discretion to decline to exercise jurisdiction out of consideration for federal-state comity.’”) (quoting Sea Prestigo, LLC, 787 F. Supp. 2d at 1119). Fourth, there is no doubt that the state court proceedings in the San Diego Action are sufficient to protect Plaintiff’s rights, especially where the rights being litigated are based on California law. While this factor garners little weight when, like here, there are no federal rights at issue, it, too, weighs in favor of dismissal or a stay. See Travelers Indem. Co., 914 F.2d at 1370 (“This factor, like choice of law, is more important when it weighs in favor of federal jurisdiction.”); see also Am. Int’l Underwriters, 843 F.2d at 1258 (parallel state court proceedings adequate and weigh in favor of stay). The other Colorado River factors - whether the state court first assumed jurisdiction over property, the inconvenience of the federal forum, and whether exercising jurisdiction would promote forum shopping - are irrelevant to the current situation and do not alter the analysis. See, e.g., Travelers Indem. Co., 914 F.2d at 1371 (absent evidence of forum shopping behavior, this factor is not relevant); Am. Int’l Underwriters, 843 F.2d at 1257-58 (factor of whether the state Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 27 of 29 Page ID #:138 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 19 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) court first assumed jurisdiction over property is not relevant where only money damages, and not tangible property, is at issue); Morisada Corp. v. Beidas, 939 F. Supp. 732, 737 (D. Haw. 1995) (inconvenience of federal forum not relevant where the state forum was geographically close to the federal forum); but see Canopus Biopharma, Inc., 2016 WL 7438795 at*5 (“However, the inconvenience of litigating in both forums simultaneously somewhat favors granting a stay pending resolution of one action.”). Dismissing or staying this case will conserve the resources of the parties, reduce the risk of piecemeal litigation and tedious coordination between judicial forums, and ensure “wise judicial administration” in accord with the Colorado River doctrine. With all of the relevant Colorado River factors weighing in favor of abstention, this Court should either dismiss or stay this action in deference to the San Diego Action. /// /// /// /// /// /// /// /// /// /// /// /// /// /// Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 28 of 29 Page ID #:139 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78478336_1 20 2:17-CV-04341 JVS (Ex) DEFENDANTS’ NOTICE OF MOTION AND MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM (FRCP 12(B)(6)) OR DISMISS OR STAY UNDER COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) IV. CONCLUSION For the reasons set forth herein, Defendants respectfully request the Court (1) dismiss this action for failing to state a claim or, in the alternative, (2) dismiss or stay this action under the Colorado River doctrine in deference to the San Diego Action, a parallel class action currently pending in San Diego Superior Court. Dated: June 19, 2017 HUGHES HUBBARD & REED LLP By: /s/ David H. Stern David H. Stern Attorneys for Defendants Fresenius Medical Care North America Holdings Limited Partnership (wrongfully named as Fresenius Medical Care North America Limited Partnership), Bio-Medical Applications of California, Inc., Renal Advantage Inc., Fresenius Medical Care - Eucalyptus, LLC, Fresenius Medical Care Goldenwest, LLC E-mail: david.stern@hugheshubbard.com Case 2:17-cv-04341-JVS-E Document 13 Filed 06/19/17 Page 29 of 29 Page ID #:140 EXHIBIT A Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 1 of 22 Page ID #:141 EXHIBIT A, Page 21 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 2 of 22 Page ID #:142 EXHIBIT A, Page 22 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 3 of 22 Page ID #:143 EXHIBIT A, Page 23 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 4 of 22 Page ID #:144 EXHIBIT A, Page 24 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 5 of 22 Page ID #:145 EXHIBIT A, Page 25 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 6 of 22 Page ID #:146 EXHIBIT A, Page 26 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 7 of 22 Page ID #:147 EXHIBIT A, Page 27 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 8 of 22 Page ID #:148 EXHIBIT A, Page 28 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 9 of 22 Page ID #:149 EXHIBIT A, Page 29 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 10 of 22 Page ID #:150 EXHIBIT A, Page 30 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 11 of 22 Page ID #:151 EXHIBIT A, Page 31 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 12 of 22 Page ID #:152 EXHIBIT A, Page 32 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 13 of 22 Page ID #:153 EXHIBIT A, Page 33 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 14 of 22 Page ID #:154 EXHIBIT A, Page 34 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 15 of 22 Page ID #:155 EXHIBIT A, Page 35 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 16 of 22 Page ID #:156 EXHIBIT A, Page 36 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 17 of 22 Page ID #:157 EXHIBIT A, Page 37 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 18 of 22 Page ID #:158 EXHIBIT A, Page 38 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 19 of 22 Page ID #:159 EXHIBIT A, Page 39 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 20 of 22 Page ID #:160 EXHIBIT A, Page 40 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 21 of 22 Page ID #:161 EXHIBIT A, Page 41 Case 2:17-cv-04341-JVS-E Document 13-1 Filed 06/19/17 Page 22 of 22 Page ID #:162 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78372537_1 2:17-CV-04341 JVS (Ex) DECLARATION OF DAVID H. STERN IN SUPPORT OF MOTION TO DISMISS OR STAY DAVID H. STERN (SBN 196408) ALEX E. SPJUTE (SBN: 229796) CAROLIN SAHIMI (SBN 260312) HUGHES HUBBARD & REED LLP 350 South Grand Avenue, 36th Floor Los Angeles, CA 90071-3442 Telephone: (213) 613-2800 Facsimile: (213) 613-2950 Email: david.stern@hugheshubbard.com Email: alex.spjute@hugheshubbard.com Email: carolin.sahimi@hugheshubbard.com Attorneys for Defendants FRESENIUS MEDICAL CARE NORTH AMERICA HOLDINGS LIMITED PARTNERSHIP, BIO-MEDICAL APPLICATIONS OF CALIFORNIA, INC., RENAL ADVANTAGE INC., FRESENIUS MEDICAL CARE - EUCALYPTUS, LLC, FRESENIUS MEDICAL CARE GOLDENWEST, LLC UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA MARITER ROLDAN, on behalf of herself and all others similarly situated, Plaintiffs, v. FRESENIUS MEDICAL CARE NORTH AMERICA LIMITED PARTNERSHIP, a Delaware limited partnership; BIO-MEDICAL APPLICATIONS OF CALIFORNIA, INC., a Delaware corporation; RENAL ADVANTAGE INC., a Delaware corporation; FRESENIUS MEDICAL CARE - EUCALYPTUS, LLC, a Delaware limited liability company; FRESENIUS MEDICAL CARE GOLDENWEST, LLC, a Delaware limited liability company; and DOES 1through 100, inclusive, Defendants. CASE NO. 2:17-CV-04341 JVS (Ex) Assigned for All Purposes to: Honorable James V. Selna DECLARATION OF DAVID H. STERN IN SUPPORT OF DEFENDANTS’ MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM UPON WHICH RELIEF CAN BE GRANTED (FRCP 12(B)(6)), OR, IN THE ALTERNATIVE, TO DISMISS OR STAY THIS ACTION UNDER THE COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) Complaint Filed: April 27, 2017 Hearing: July 24, 2017 Time: 1:30 p.m. Courtroom: 10C Case 2:17-cv-04341-JVS-E Document 13-2 Filed 06/19/17 Page 1 of 4 Page ID #:163 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78372537_1 1 2:17-CV-04341 JVS (Ex) DECLARATION OF DAVID H. STERN IN SUPPORT OF MOTION TO DISMISS OR STAY DECLARATION OF DAVID H. STERN I, David H. Stern, state as follows: 1. I am an attorney admitted to practice in California. I am a partner with the firm of Hughes Hubbard & Reed LLP, counsel of record for Defendants Fresenius Medical Care North America Holdings Limited Partnership, wrongfully named in this action as Fresenius Medical Care North America Limited Partnership, Bio-Medical Applications of California, Inc., Renal Advantage Inc., Fresenius Medical Care - Eucalyptus, LLC, and Fresenius Medical Care Goldenwest, LLC (all collectively, “Defendants”). I have personal knowledge of the facts set forth below and if called as a witness, could and would testify competently thereto, under oath. 2. I am counsel of record for defendants in Yolanda Gonzales, individually and on behalf of all others similarly situated v. Fresenius Medical Care Holdings, et al., filed in the Superior Court of California for the County of San Diego, Case No. 37-2013-00072469-CU-OE-CTL, on October 21, 2013 (the “San Diego Action”). The defendants in the San Diego Action are Fresenius Medical Care Holdings Inc. d/b/a Fresenius Medical Care North America (“FMCNA”); Fresenius Vascular Care, Inc.; American Access Care of San Diego, LLC; and American Access Care of Southern California, LLC (all collectively, “Fresenius”). The latter three entities are indirect subsidiaries of FMCNA. 3. The San Diego Action asserts class claims on behalf of all California non-exempt employees and former employees of Fresenius-affiliated dialysis clinics and vascular centers, allegedly from October 12, 2008 through the present, for, inter alia, (1) failure to pay all wages and overtime wages (Cal. Labor Code §§ 510, 1194, 1198); (2) failure to provide meal periods (Cal. Labor Code §§ 226.7, 512); (3) failure to pay accurate itemized wage statements (Cal. Labor Code §§ 226, 1174, 1175); (5) failure to pay all wages due upon ending of employment (Cal. Case 2:17-cv-04341-JVS-E Document 13-2 Filed 06/19/17 Page 2 of 4 Page ID #:164 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78372537_1 2 2:17-CV-04341 JVS (Ex) DECLARATION OF DAVID H. STERN IN SUPPORT OF MOTION TO DISMISS OR STAY Labor Code §§ 201-203); and (6) unfair business practices (Cal. Bus. & Prof. Code §17200). 4. Fresenius challenged the pleadings in the San Diego Action, demurring and moving to strike portions of the operative complaints in 2014. The court in the San Diego Action ruled on these motions in 2014. 5. Discovery also began in the San Diego Action in February 2014, where Plaintiff Gonzales propounded numerous discovery requests on Fresenius, seeking wide-ranging class discovery regarding all Fresenius-affiliated non-exempt employees in California. Fresenius responded to the discovery requests, met and conferred extensively with Plaintiff’s counsel, and subsequently moved for a protective order on the grounds that the discovery requests, which asked that Fresenius produce information regarding thousands of non-exempt affiliate employees across hundreds of different facilities in California, including manufacturing facilities, laboratories, and dialysis clinics were oppressive, burdensome, and premature. On August 1, 2014, the court in the San Diego Action granted the protective order with respect to documents concerning non-party affiliates of FMCNA. The parties to the San Diego Action subsequently met and conferred regarding a Belaire-West class notice within the parameters of the protective order, and Fresenius produced putative class discovery including time entries and wage statement information. 6. On March 4, 2015, Plaintiffs in the San Diego Action were given leave to file a Second Amended Complaint, adding a new named Plaintiff, Alberto Munguia, a former Fresenius-affiliated dialysis employee, and expanding their allegations against the Fresenius-affiliated dialysis centers in California. Based on the expanded allegations in the Second Amended Complaint, Defendants removed the San Diego Action under CAFA on April 3, 2015, S.D. Cal. Case No. 3:15-cv- 00735-L-BGS. The San Diego Action remained pending in federal court until September 19, 2016, when it was remanded back to the state court. On January 19, Case 2:17-cv-04341-JVS-E Document 13-2 Filed 06/19/17 Page 3 of 4 Page ID #:165 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78372537_1 3 2:17-CV-04341 JVS (Ex) DECLARATION OF DAVID H. STERN IN SUPPORT OF MOTION TO DISMISS OR STAY 2017, Plaintiffs filed with the state court a notice of remand and denial of Defendants’ petition for permission to appeal. 7. Since the San Diego Action was remanded to the state court, the parties have continued to engage in class discovery. In January 2017, Plaintiffs propounded additional written discovery requests, seeking comprehensive class- wide discovery, and in March 2017, Fresenius responded to the same. The parties have met and conferred extensively regarding the scope of putative class discovery, including negotiating a broadened Belaire-West notice, and a 10% sample size for production purposes of the nearly 6000 putative class members. Fresenius is currently in the process of preparing the responsive employee data and other responsive documents. I declare under the penalty of perjury that the foregoing is true and correct. Executed on June 19, 2017. /s/ David H. Stern David H. Stern Case 2:17-cv-04341-JVS-E Document 13-2 Filed 06/19/17 Page 4 of 4 Page ID #:166 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78495942_1 2:17-CV-04341 JVS (Ex) [PROPOSED] ORDER DAVID H. STERN (SBN 196408) ALEX E. SPJUTE (SBN: 229796) CAROLIN SAHIMI (SBN 260312) HUGHES HUBBARD & REED LLP 350 South Grand Avenue, 36th Floor Los Angeles, CA 90071-3442 Telephone: (213) 613-2800 Facsimile: (213) 613-2950 Email: david.stern@hugheshubbard.com Email: alex.spjute@hugheshubbard.com Email: carolin.sahimi@hugheshubbard.com Attorneys for Defendants FRESENIUS MEDICAL CARE NORTH AMERICA HOLDINGS LIMITED PARTNERSHIP, BIO-MEDICAL APPLICATIONS OF CALIFORNIA, INC., RENAL ADVANTAGE INC., FRESENIUS MEDICAL CARE - EUCALYPTUS, LLC, FRESENIUS MEDICAL CARE GOLDENWEST, LLC UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA MARITER ROLDAN, on behalf of herself and all others similarly situated, Plaintiffs, v. FRESENIUS MEDICAL CARE NORTH AMERICA LIMITED PARTNERSHIP, a Delaware limited partnership; BIO-MEDICAL APPLICATIONS OF CALIFORNIA, INC., a Delaware corporation; RENAL ADVANTAGE INC., a Delaware corporation; FRESENIUS MEDICAL CARE - EUCALYPTUS, LLC, a Delaware limited liability company; FRESENIUS MEDICAL CARE GOLDENWEST, LLC, a Delaware limited liability company; and DOES 1through 100, inclusive, Defendants. CASE NO. 2:17-CV-04341 JVS (Ex) Assigned for All Purposes to: Honorable James V. Selna [PROPOSED] ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CLAIM UPON WHICH RELIEF CAN BE GRANTED (FRCP 12(B)(6)), OR, IN THE ALTERNATIVE, TO DISMISS OR STAY THIS ACTION UNDER THE COLORADO RIVER DOCTRINE (FRCP 12(B)(1)) Complaint Filed: April 27, 2017 Hearing: July 24, 2017 Time: 1:30 p.m. Courtroom: 10C Case 2:17-cv-04341-JVS-E Document 13-3 Filed 06/19/17 Page 1 of 2 Page ID #:167 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 78495942_1 2:17-CV-04341 JVS (Ex) [PROPOSED] ORDER Having read and considered Defendants Fresenius Medical Care North America Holdings Limited Partnership (“Fresenius Holdings LP”), wrongfully named in this action as Fresenius Medical Care North America Limited Partnership, Bio-Medical Applications of California, Inc. (“Bio-Medical Applications”), Renal Advantage Inc. (“Renal Advantage”), Fresenius Medical Care - Eucalyptus, LLC (“Eucalyptus”), and Fresenius Medical Care Goldenwest, LLC’s (“Goldenwest”) (all collectively, “Defendants”) Motion to Dismiss The Complaint For Failure To State A Claim Upon Which Relief Can Be Granted (FRCP 12(b)(6)), Or, In The Alternative, To Dismiss Or Stay This Action Under The Colorado River Doctrine (FRCP 12(b)(1)) (the “Motion”), the papers filed in support and opposition, having heard the arguments of counsel, and good cause appearing therefore, IT IS HEREBY ORDERED THAT the Defendants’ Motion is granted; IT IS FURTHER ORDERED THAT the Complaint is dismissed in its entirety because it fails to state a claim upon which relief can be granted. In the alternative, IT IS HEREBY ORDERED THAT this action is dismissed [or stayed] under the Colorado River doctrine pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure. IT IS SO ORDERED. Dated: ________________, 2017 ______________________________ The Honorable James V. Selna Case 2:17-cv-04341-JVS-E Document 13-3 Filed 06/19/17 Page 2 of 2 Page ID #:168