Good morning, welcome to my latest edition of Monday Morning Briefing.   I gave you all a break last week, and from what I can tell, some of you were still reeling from the last few of these I sent out, so perhaps it was a good thing.

But the sun is shining, the sky is blue, it is May, and all is back to normal.  Which means that employees are still suing, the legislature and courts are trying to find new ways to make like more difficult for employers; it’s a typical Monday in California.  So let’s jump right in, shall we?

ORAL ARGUMENT SET IN ADOLPH V UBER – BEFORE THE CALIFORNIA SUPREMES TOMORROW 9AM

Tomorrow, I will be up with my team and my backyard full of animals listening to the oral argument on the long awaited Adolph v Uber case taking place before the California Supreme Court.  The case will finally decide the issue that was left open after the US Supreme Court handed what employers initially thought was a pretty clean victory in the Viking Rivers Cruises case last year.   Unfortunately, the Plaintiffs’ bar quickly picked up on an issue left open by a concurring opinion authored by Justice Sotomayor, which threw a monkey’s wrench into the outcome of the original SOCTUS decision, allowing this final play by the California Supreme Court.

A brief recap of how we got here – in 2014, the California Supreme Court ruled in the case of  Iskanian v CLS Transportation that arbitration agreements, and class action waivers in particular, were not binding on cases involving the Private Attorney General Act  (PAGA) cases, and not governed by the Federal Arbitration Act (FAA), essentially because the State of California was a party to the PAGA action. 

The Iskanian rule remained in play for several years, until the US Supreme Court was asked to take a look at the decision by way of the case of Viking River Cruises adv Moriana.   And indeed, in June, 2022, SCOTUS issued a decision, with Justice Alito writing for the majority and delivering what we all thought was a knock out punch, essentially overturning the eight year decision in Iskanian and reaffirming the strong preemptive powers of the FAA.  It proclaimed that indeed, the FAA did have the power to enforce class action waivers and order  an individual into arbitration to adjudicate his or her own individual Labor Code and PAGA claims. 

The majority opinion went on to conclude that once the individual went into arbitration, the remaining “non-individual” PAGA claims cannot proceed in court if the individual claims had been compelled to arbitration.  However, this is where things get tricky.  Justice Sotomayor wrote a concurring opinion; she agreed with the majority that the FAA should apply, but suggested that what happens with the remaining non-individual claims should not be decided by them.  It really should be decided by California law, either the courts or the legislature.  Which left this big, gaping hole.

California can’t wait to get even.   So let me paint this picture.  It’s 2022, and the United States Supreme Court, the same US Supreme Court that has just destroyed  Roe v Wade, has just messed with a pretty well known California Supreme Court case.  California is NOT happy with the SCOTUS.  (I mean, let’s face it, except for Viking River Cruises, I am not much of a fan of what SCOTUS has done lately either, let’s be real).  And Justice Sotomayor has thrown this soft lob back to California to take back its law and straighten things out.

And what’s coming up before the California Supreme Court, right on cue?  A pretty important case, one that the California Supremes want to hear anyway, involving Uber.  Their favorite company.   So this seems like the perfect opportunity to look at this issue, and here it is, just MONTHS after it is handed to California on a platter.  So back it comes for California to interpret.  And here is the question:

When the individual is ordered to arbitration, what happens to all the other non-individual claims?   Do they (a) get dismissed, like Justice Alito assumed happened, or (b) wait for the outcome of the individual arbitration, to make sure that at least the original plaintiff was harmed or wronged in some way, or (c) do the non-individual claims get to proceed in court anyway, regardless of the outcome of the individual arbitration?  In other words, even if the original plaintiff suffered, NO HARM, the group PAGA claims can continue.    And if this latter result is the outcome, which is what we suspect will be the result, it is actually the worst of all worlds, because now we would be paying for an induvial arbitration that has no bearing on the rest of the case.  So why bother?

But, we will still have to wait to officially find out the results of the case.  Stay tuned.

Next week, by the way, I will talk to you about what the Ninth Circuit says about AB 5 – the independent Contractor law, and how California is battling that.   That is another federal court v State of California story.  SO MUCH FUN!

TIPS FROM LITIGATORS – SAVE YOUR ENVELOPES, TEXTS, VIDEOS AND EMAILS!

I’m somewhat combining two different topics in the above title, but they emanate from a discussion held in our latest department meeting last week, and I promised I would do a shout out on these issues to you all this week.  Let me break it down for you.

Responding to demand letters for wage statements and personnel files.  First, with increasing frequency, we have been receiving demand letters from attorneys asking for copies of wage statements and personnel files for former employees.  The law changed a few years ago, making these annoying letters easier for attorneys to send.  One thing to know, first of all, these attorneys cannot do this without including an authorization from the employee.  More often than not, they fail to include it. 

But the other important thing to note, these attorneys OFTEN back date these letters.  And the fines and fees they seek  for being late run from your receipt of the letters.  Of course, we cannot prove when you receive the letters, UNLESS YOU SAVE YOUR ENVELOPES.  So please, SAVE YOUR ENVELOPES.  Often, by the time you get us these letters, the envelopes are long gone.  So, my attorneys, paralegals and assistants are asking me to ask you NOW.  Tell your staff, now. If you have not gotten one of these letters, you will.  We are getting them nearly daily from our clients.

Please do not destroy evidence or potential evidence.  Another reminder from my litigation team – once you are in litigation, or if there is a threat of litigation (that is, a demand letter, administrative claim, or anything of that nature), you must preserve all relevant texts, emails, documents, that may be relevant to that matter.  That means, even if you normally destroy documents due to normal document destruction protocols, don’t.  And on a personal level, if you are getting a new phone, for example, make sure you have backed up all your texts.  The safest protocol is to give everything to us and have us image all relevant documents at the start of a case, just to be safe.  The same would go for any key managers who we know to be witnesses, on any major case.   Then there can be no accusation that evidence was destroyed. 

This is especially true for things like videos, that can be recorded over quickly if we do not know they are relevant immediately.   Make SURE to save any video that is even questionably important. 

We normally send out what we call “litigation hold” letters in major litigation, but sometimes the letters do not go out until a lawsuit is filed, and information becomes “evidence” long before that, say, a demand letter stage.  It usually helps us to have key evidence, so take steps to preserve it there is a hint it may be important later, for example, if you are conducting any kind of investigation.  IF IN DOUBT, save everything. 

Finally, if you don’t get enough of me here, my dear friend Jason Berkowitz (who MANY of you already know), decided he wanted to put a voice to some of these articles, so he has asked me to join him on his podcast: LA Hospitality News To Go.  He even made me go get a REAL MIC!  (It’s so much fun!!)  Anyway, it’s available on all podcast platforms, or you can check out this website:

https://www.lahospitalitynewstogo.com/

And I hope you all have been taking a little time for your selves, to put on your own oxygen masks, as I say.  We took a group from my firm up to the Hollywood Sign to enjoy the beautiful weekend yesterday, and I plan to take the day Sunday with my daughter for Mother’s Day.  To my fellow mamas out there, I see you and support you as well, and hope you either get time with your family or away from them, which ever gives you more pleasure these days (no judgment here, I understand where you are!)

#StandWithUkraine