Lawson v. Grubhub, Inc.

Background

Raef Lawson’s operative complaint asserted five types of claims: expense reimbursement, minimum wage, overtime, violation of California’s Unfair Competition Law, and civil penalties under California’s Private Attorneys General Act (PAGA). The parties agreed to divide the case into phases. The first phase addressed Lawson’s individual claims and whether he was an employee who could pursue PAGA penalties. The second phase would address the amount of any PAGA penalties claim.

After an earlier judgment for Grubhub on the expense-reimbursement, minimum-wage, and overtime claims, the Ninth Circuit vacated that judgment and sent the case back for further proceedings. On remand, this court determined that the Borello standard governed the expense-reimbursement claim and that Lawson was not an employee for that claim. For the minimum-wage and overtime claims, the court applied California’s ABC test and determined that Lawson was an employee. The court entered judgment for Lawson on the minimum-wage claim, with damages of $65.11, and for Grubhub on the overtime claim. The PAGA penalties claim remained unresolved.

Grubhub’s Motion for Entry of Judgment

Grubhub moved under Federal Rule of Civil Procedure 54(b) for separate judgment on Lawson’s individual expense-reimbursement, minimum-wage, and overtime claims. Rule 54(b) can permit a court to enter final judgment on fewer than all claims, but only when the resolved claims are sufficiently separate from the remaining claims and there is no just reason to delay judgment.

The court concluded that Grubhub did not satisfy either requirement. Although the court had resolved Lawson’s individual claims, those claims were not sufficiently separate from the PAGA penalties claim. The claims involved overlapping questions about whether workers were employees, whether an exemption applied, and whether certain time was compensable. They also involved overlapping facts concerning Grubhub’s policies, business model, and operations. Entering judgment and allowing an immediate appeal could therefore lead to repeated review of much of the same factual and legal material.

The court also found reasons to wait until the case was more fully resolved. It noted that the case had been pending since 2015 and had already been appealed and sent back once. Further delay could cause memories to fade and evidence to become stale, and separate proceedings could duplicate the court’s work.

Request for Interlocutory Appeal

In the alternative, Grubhub asked the court to certify its prior orders for an immediate appeal under 28 U.S.C. § 1292(b). That procedure requires a controlling question of law, substantial disagreement about that legal question, and a finding that an immediate appeal could materially advance the end of the litigation.

The court found that Grubhub did not meet the first requirement. One proposed issue—whether mileage expenses could be included in Lawson’s effective hourly rate—was a legal question, but it was not controlling because Lawson would recover some minimum-wage damages even without including mileage expenses. Grubhub’s other proposed issues concerned whether Lawson’s non-delivery time was compensable and whether his work was outside Grubhub’s usual business. The court characterized those issues as applications of established law to the facts, rather than controlling legal questions suitable for immediate appeal.

Disposition

The court denied Grubhub’s motion. The order also vacated the June 8, 2023 hearing and stated that the case management conference would take place by Zoom at 1:30 p.m. rather than in person at 10:00 a.m. The order disposed of Docket No. 317.