McElroy v. Vitalant

Background

Kim McElroy sued her former employer, Vitalant, on behalf of herself and a proposed class of similarly situated individuals. She asserted eleven claims under California wage-and-hour laws and the California Business and Professions Code. Vitalant removed the case from state court under the Class Action Fairness Act.

The court had previously granted Vitalant’s motion for judgment on the pleadings because McElroy’s First Amended Complaint did not include enough facts to make the alleged violations plausible. The court allowed her to amend. McElroy filed a Second Amended Complaint three days after the court-ordered deadline. The court rejected Vitalant’s argument that the late filing required dismissal, finding that the delay was minor and that Vitalant did not appear to have been prejudiced.

Motion to dismiss

Vitalant moved to dismiss the Second Amended Complaint under Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint states a legally sufficient claim. The court held that most of McElroy’s claims remained inadequately pleaded.

The court dismissed the meal-break and rest-break claims, claims one and two, with leave to amend. McElroy alleged that COVID-related tasks before clocking in caused her workday to begin earlier, but she did not identify a specific instance when those tasks were required, explain how often they occurred, or identify who required them. The court gave her another opportunity to provide those details.

The court dismissed the minimum-wage and overtime claims, claim three, with leave to amend. McElroy identified a mandatory vaccination on October 10, 2022, and alleged that she worked more than 40 hours during the relevant pay period. The court found that she did not provide enough information about her work schedule, the duration of the vaccination, or her wages to make it plausible that she worked more than 40 hours in a particular week or was owed additional wages.

The court dismissed the claims for failure to pay reporting time, failure to pay vacation wages, and failure to reimburse business expenses, claims four, five, and eight, without leave to amend. McElroy did not amend those claims and continued to allege generally that Vitalant had unlawful policies without identifying facts supporting the policies’ existence or application to her.

For claim nine, McElroy alleged that Vitalant paid employees through pay cards that charged a fee to access wages. The court dismissed her individual or class claim under California Labor Code section 212(a) without leave to amend because that statute does not provide a private right to sue for damages. But the court held that she could pursue the alleged violation through the California Private Attorneys General Act, known as PAGA, which permits an aggrieved employee to seek certain civil penalties on behalf of the state and other affected employees. The PAGA version of claim nine was sufficiently pleaded because the complaint alleged that the pay card could not be used without a fee. The dismissal motion was denied as to that PAGA claim.

The court dismissed the unfair-competition claim, claim ten, without leave to amend. It held that McElroy could not seek equitable restitution because she had an adequate remedy through damages claims. It also held that, as a former employee, she lacked standing to seek an injunction against future violations because she did not face a future injury from Vitalant’s alleged conduct.

The derivative claims for inaccurate wage statements and untimely final wages, claims six and seven, were dismissed with leave to amend because they depended on claim three, which might be revived in a further amended complaint. The representative PAGA claim, claim eleven, was dismissed without leave to amend to the extent it depended on claims dismissed without leave to amend. It was dismissed with leave to amend to the extent it depended on claims one, two, three, six, or seven, for which amendment was allowed.

Motion to strike class allegations

Vitalant also moved under Rule 12(f) to strike McElroy’s class allegations as too conclusory. The court acknowledged that the allegations were very thin, but denied the motion. It held that striking class allegations at the pleading stage is generally disfavored and that the adequacy of the proposed class should ordinarily be addressed during the class-certification process. Vitalant may renew its arguments in opposition to class certification if discovery does not produce facts supporting the requirements for a class action.

Disposition

The court granted Vitalant’s motion to dismiss in part and denied it in part. The motion was denied only as to claim nine insofar as McElroy intends to pursue it through PAGA. Claims one, two, and three were dismissed with leave to amend. Claims four, five, eight, claim nine insofar as asserted individually or on a class basis, and claim ten were dismissed without leave to amend. Claims six, seven, and eleven may be revived to the extent they depend on claims for which amendment was allowed. The court denied Vitalant’s motion to strike. Any final amended complaint had to be filed within 21 days of the order.