Rubalcaba v. R&L Carriers Shared Services, L.L.C.

Background

Joseph Rubalcaba originally filed this proposed class action in Santa Clara County Superior Court on October 6, 2023. R&L Carriers Shared Services, L.L.C. removed the case to federal court under the Class Action Fairness Act, a federal law that permits federal jurisdiction over certain class actions. Rubalcaba then filed an amended complaint and moved to remand the case to state court. R&L moved to dismiss the amended complaint and requested judicial notice of two filings from an earlier class-action settlement involving R&L.

The amended complaint asserted ten California-law claims involving overtime pay, meal-period premiums, rest-period premiums, minimum wages, wages due at the end of employment, timely wage payments during employment, wage statements, payroll records, business expenses, and unfair competition. Rubalcaba also sought to represent a class of current and former hourly-paid or non-exempt employees who worked for the defendants in California during the specified period.

Motion to Remand

The court denied Rubalcaba’s motion to remand. It held that R&L adequately established jurisdiction under the Class Action Fairness Act, which requires more than $5 million in controversy, minimal diversity of citizenship, and at least 100 class members.

For minimal diversity, the court accepted the parties’ agreement that Rubalcaba and the proposed class members were California citizens. The court found that R&L’s principal place of business, or “nerve center,” was in Ohio based on the removal filings and Daniel J. Brake’s declaration. The declaration stated that R&L’s administrative functions, highest-level executives, and most corporate officers operated primarily from Wilmington, Ohio. The court noted that Rubalcaba could raise the citizenship argument again if later factual development cast doubt on the finding.

The court also found that the amount in controversy exceeded $5 million. R&L estimated that the meal- and rest-break claims alone placed $6,100,742.42 at stake, based on employee and workweek estimates and an assumed 20 percent violation rate. The court found the supporting declarations sufficiently reliable and concluded that the assumption had a reasonable basis in the allegations of a pattern and practice of wage violations. Because those two claims alone exceeded the jurisdictional threshold, the court did not need to resolve the parties’ dispute about the amount of attorneys’ fees.

Judicial Notice

The court granted R&L’s request for judicial notice of an order approving a class-action settlement and a related joint settlement stipulation from an earlier case involving R&L. The court took notice of the existence and contents of those public filings but did not adopt the legal conclusions R&L argued followed from them.

Motion to Dismiss

The court granted R&L’s motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), which allows dismissal when a complaint does not state a legally sufficient claim. The court held that the amended complaint lacked enough specific facts to make the claims plausible rather than merely possible or conclusory.

The court dismissed the first and fourth causes of action, concerning overtime and minimum wages, because Rubalcaba did not identify a specific workweek, the length and frequency of unpaid work, his role or roles, or specific instances of incorrectly calculated wages.

The court dismissed the second and third causes of action, concerning meal and rest periods, because the complaint did not describe a specific missed meal or rest break or a specific policy that prohibited appropriate breaks. Repeating the statutory requirements was not enough.

The court dismissed the fifth cause of action, concerning wages due at termination, because it depended on the dismissed overtime, minimum-wage, and break claims. The court also found that Rubalcaba did not allege specific facts about his final paycheck or the wages allegedly left unpaid.

The court dismissed the sixth cause of action, concerning timely wage payments during employment, because the complaint did not allege facts showing when payments were made or how they violated California’s wage-payment schedule.

The court dismissed the seventh cause of action, concerning accurate wage statements. Although the court found that the complaint adequately alleged injury and a knowing and intentional failure at the pleading stage, it concluded that Rubalcaba did not identify a specific deficient wage statement or provide facts distinguishing the claim from a general restatement of statutory language.

The court dismissed the eighth cause of action, concerning payroll records, because the allegations provided no factual details about the records and merely recited the statute’s requirements.

The court dismissed the ninth cause of action, concerning reimbursement of business expenses, because the complaint did not say what expenses were incurred, when they were incurred, why they were necessary, or how R&L was notified. Alleging the use of personal phones for business purposes was insufficient by itself.

The court dismissed the tenth cause of action under California’s Unfair Competition Law because it depended on the other alleged legal violations, which the court had dismissed.

The court also dismissed Rubalcaba’s class allegations. It found that the complaint did not explain how his experiences related to those of other employees and did not allege his job title or responsibilities. The court concluded that the proposed class allegations were too conclusory to justify class discovery. The court did not decide whether the proposed class included time-barred claims or claims released in the earlier settlement.

Disposition

The court denied the motion to remand, granted R&L’s motion to dismiss, and granted R&L’s request for judicial notice. The dismissal was without prejudice because the court could not conclude that amendment would be futile. Any amended complaint was due within 21 days of the order. The court also set a telephonic case-management conference for June 11, 2024.