Aaron Feao v UFP Riverside LLC, 2017 WL 2836207 (C.D. Cal. June 29, 2017).

In this action, while denying Plaintiff Aaron Feao’s (“Plaintiff”) Motion to Remand, the United States District Court, Central District of California (the “District Court”), found the ultimate inquiry is what amount is put ‘in controversy’ by Plaintiff’s complaint or other papers, not what the defendant will actually owe for the actual number of violations that occurred.

Plaintiff brought a putative class action in the Superior Court for the County of Los Angeles alleging Defendant UFP Riverside, LLC (“Defendant”) engaged in a uniform policy and systematic scheme of wage abuse against their hourly-paid or non-exempt employees. Plaintiff asserted Defendant failed to pay overtime wages, provide meal and rest periods, pay the minimum wage, and pay wages owed at termination, among other violations.

Defendant removed the action to the District Court pursuant to the Class Action Fairness Act (“CAFA”). Thereafter, Plaintiff moved to remand, which the District Court denied.

Defendant contended the amount in controversy exceeded $5,000,000 based on the damage calculations. Defendant also submitted the declaration of its Director of Compensation and HR Systems, Jody Perrien (“Perrien”), who provided statistics gleaned from its records, such as the number of putative class members, the putative class members’ weighted average hourly wage, and the number of putative class members terminated during the relevant time period.  Defendant calculated, based on Plaintiff’s allegations and Perrien’s declaration that the amount in controversy, excluding attorneys’ fees, for Plaintiff’s claims amounted to $5,119,566.  Defendant’s calculation of the amount in controversy assumed there were 218 people in the putative class, and that the people worked approximately 22,218 work weeks and earned roughly $16.26 per hour in the relevant time period.

Plaintiff asserted Defendant’s assumptions were arbitrary and designed solely to allow it to claim the $5,000,000 amount in controversy required for CAFA jurisdiction. The District Court, however, found Defendant’s assumptions were supported by the wide-ranging allegations in the complaint, and courts have approved even more generous assumptions based on allegations nearly identical to those presented in the complaint.

The District Court found Plaintiff alleged Defendant engaged in a uniform policy and systematic scheme of wage abuse against their hourly-paid or non-exempt employees within the State of California, and at all material times Defendant failed to pay overtime wages, failed to provide uninterrupted meal and rest periods, failed to pay minimum wages, failed to pay wages owed at discharge or resignation, delayed in paying wages, and failed to provide and keep accurate wage statements and payroll records. The District Court further found Plaintiff’s allegations contained no qualifying words such as “often” or “sometimes” to suggest less than uniform violation that would preclude a 100 percent violation rate.  To the contrary, the District Court found Plaintiff used language, such as “at all material times,” that supported an assumption of universal violations.

The District Court also noted that although the language in the complaint would support a 100 percent violation rate for all claims, Defendant assumed each class member worked only one unpaid hour of overtime and missed only one hour of minimum wage work per work week, and Defendant only factored in a 60 percent violation rate for Plaintiff’s meal and rest period claims. The District Court thus found Defendant’s assumptions were sufficiently supported.

The District Court concluded Defendant had proven the amount in controversy by a preponderance of the evidence, thereby satisfying the requirements for federal jurisdiction under CAFA, and accordingly, denied Plaintiff’s Motion to Remand.

Yaron Shaham