Kastler v. Oh My Green, Inc.

Background

Anne Kastler filed a proposed wage-and-hour class action in San Mateo County Superior Court. She alleged that Oh My Green, Inc. failed to pay overtime and minimum wages, provide or pay for meal and rest periods, timely pay final wages, provide accurate wage statements, reimburse business expenses, and comply with California’s Unfair Competition Law. Kastler worked for Oh My Green as an hourly, non-exempt employee in California from approximately November 2016 to February 2017.

Oh My Green removed the case to federal court under the Class Action Fairness Act (CAFA). Kastler moved to remand, meaning she asked the federal court to return the case to state court. Oh My Green separately moved to dismiss Count Six of the first amended complaint, which alleged violations of California Labor Code section 226(a) based on inaccurate wage statements.

Motion to Remand

The court denied Kastler’s motion to remand. CAFA provides federal jurisdiction over a class action when the amount in controversy exceeds $5 million, there is minimal diversity between the parties, and the proposed class has at least 100 members. Kastler did not dispute that the proposed class exceeded 100 members, but challenged minimal diversity and the amount in controversy. She also argued that CAFA’s local-controversy and home-state-controversy exceptions required remand.

The court found minimal diversity because Oh My Green acknowledged that its headquarters were in San Mateo, California, while the company identified six current or former California employees who worked in California but later lived outside California. The court also relied on the original complaint’s class definition, which did not limit the proposed class to California residents. The court stated that it had to evaluate the complaint as it existed when the case became removable, rather than a later amendment intended to eliminate federal jurisdiction.

The court found that the amount in controversy exceeded $5 million. It accepted several of Oh My Green’s assumptions about the proposed class, including 476 class members, 296 full-time hourly employees, approximately 26 workweeks, and an average hourly wage of $16.50. It rejected the company’s use of a 100% violation rate for meal and rest breaks because the complaint did not allege that every break was missed. The court instead used a 20% violation rate and reduced the meal-and-rest-break estimate to $408,408. It also deducted $510,510 to avoid counting the same losses again as restitution under the Unfair Competition Law. After including estimated overtime, minimum-wage, waiting-time, wage-statement, and attorney-fee amounts, the court calculated a total amount in controversy of $5,457,353.

The court also rejected Kastler’s argument that the local-controversy and home-state-controversy exceptions applied. The original complaint did not limit the class to California citizens, and Kastler provided no evidence showing that at least two-thirds of the proposed class members were California citizens. The court therefore concluded that removal was proper under CAFA and denied the motion to remand.

Motion to Dismiss Count Six

The court denied Oh My Green’s motion to dismiss Count Six. Under Rule 12(b)(6), a court may dismiss a claim that does not allege enough facts to support a legally recognized claim. California Labor Code section 226(a) requires employers to provide wage statements containing specified information, including the employee’s total hours worked.

Kastler alleged that Oh My Green automatically deducted 30 minutes from shifts exceeding six hours and five minutes. She alleged that this policy made it impossible for employees to determine their total hours worked, the compensation they were owed, and whether they had been paid correctly. The court held that these allegations sufficiently stated a claim and adequately alleged the required injury. The court found Oh My Green’s argument that the claim sought an improper double recovery unpersuasive.

Conclusion

Judge Gilliam denied both Kastler’s motion to remand and Oh My Green’s motion to dismiss Count Six. The court found that Oh My Green had shown that removal was proper under CAFA and that Kastler had alleged sufficient facts to support the wage-statement claim. The parties were directed to meet and confer and submit a proposed scheduling order by November 7, 2019.