Employers of 26 or more employees need to update their handbooks and revise their HR policies. They need to provide wage increases to their minimum wage employees effective July 1, 2016, adopting both minimum wage rules and paid sick leave benefits applicable to all employees who perform at least two hours of work in a particular week within the boundaries of the City of Los Angeles.
The Defend Trade Secrets Act of 2016 (“DTSA”), enacted on May 11, 2016, represents the significant trade secret reform legislation in years. The DTSA amends the Economic Espionage Act of 1996, providing for federal criminal penalties for foreign economic espionage and trade secret theft and adds new federal civil trade secret protections. The Act creates a new cause of action which became effective immediately – for trade secret misappropriation. The Federal Courts take jurisdiction and provide remedies. The plaintiff has a choice of Federal or State remedies. There is whistleblower protection and employment contracts require disclosure about the whistleblower protection and immunity provisions in employee contract “that governs the use of a trade secret or other confidential information” that is “entered into or updated after” May 11, 2016. The failure to provide notice will bar exemplary damages or attorney fees against an employee who did not receive notice.
California law provides that for every four hours of work, an employee must be allowed a ten minute rest break. The employer is not obligated to ensure one is taken, and the employee may opt to not take a rest break. An employer also may require an employee to remain on work premises during a rest period.
It is unclear when the rest period should be taken. It is not required by law that a rest period be taken after a four hour work period, only that a rest period is permitted for every four hours worked.
In 2012, the California Supreme Court decided an important meal and rest break case, Brinker Restaurant Corp. v. Superior Court. The question of whether employers must ensure breaks are taken or must simply provide breaks has been a source of significant litigation in both federal and state courts. The California Supreme Court ruled in Brinker’s favor on the most critical part of the decision – holding that employers do not have to ensure employees take their meal breaks. Once the meal period is provided, there is no duty to police meal breaks to ensure no work is being done. This case has been, in an usual act by the court, “depublished” pending subsequent filings. Although depublished, California courts have followed the decision and cited to the Brinker decision.
Class certification is most often defeated where there is no “community of interest”, and most often for failure of commonality, or “predominance” grounds, rather than on the grounds of typicality, adequacy, ascertainability, and numerosity.
The ‘community of interest’ requirement embodies three factors: (1) predominant common questions of law or fact; (2) class representatives with claims or defenses typical of the class; and (3) class representatives who can adequately represent the class.
In opposing class certification defense has to show plaintiff would not be able to establish liability on the merits, i.e., there is no substance to the allegations complained of. Thus there is no commonality or predominance of class issues. There may be individualized issues but the common issues do not predominate.
Following is a synopsis of California law as it pertains to class certification:
In 2011, the United States Supreme Court raised the bar for plaintiffs seeking class certification by requiring lower courts to conduct a “rigorous analysis” to determine whether the prerequisites for certification are met. Wal-Mart, 131 S. Ct. at 2551 (reversing the grant of class certification due to a lack of commonality under Fed. R. Civ. P. 23(a)(2)). This “rigorous analysis,” the Court explained, often will “entail some overlap with the merits of the plaintiff’s underlying claim.” Id. In the words of the Court, a merits-entwined inquiry for purposes of class certification “cannot be helped.” Id. at 2551-52 (collecting cases).
Two years later, the Supreme Court doubled-down on its “rigorous analysis” requirement for class certification, applying the teachings of Wal-Mart to prospective Rule 23(b)(3) classes as well. See Comcast Corp. v. Behrend, 133 S. Ct. 1426, 1432 (2013) (reversing the grant of class certification due to a lack of predominance under Fed. R. Civ. P. 23(b)(3)). In Comcast, the Court criticized the lower court’s “refus[al] to entertain arguments against respondents’ damages model that bore on the propriety of class certification, simply because those arguments would also be pertinent to the merits determination.” Id. at 1432-33. Rather, the Court’s precedents “flatly” require a determination that Rule 23 is satisfied, “even when that requires inquiry into the merits of the claim.” Id. at 1433.
The third installment in the Supreme Court’s class-action trilogy came in 2014 in Halliburton Co. v. Erica P. John Fund, Inc., 134 S. Ct. 2398 (2014). There, the Supreme Court opened the door even further to merits-based defenses at the class-certification stage—this time in the context of securities class actions. In Halliburton, the Court held that securities defendants can rebut the presumption of reliance under a fraud-on-the-market theory not only during the merits phase but also during class certification. Id. at 2414-15. Securities defendants, moreover, can rebut this presumption through the use of direct and indirect evidence alike. Id. at 2417.
The Wal-Mart/Comcast/Halliburton triumvirate marked big wins for class-action defendants, enabling them to raise merits-based defenses that might otherwise never be presented to a court. That is so because many class cases are settled following certification, given the high stakes of merit-stage proceedings. Now, those merits issues are ripe for consideration at the class stage, to the extent they inform the certification analysis.
Other courts have also followed these decisions discussed above. To the extent the propriety of certification depends upon disputed threshold legal or factual questions, a court may, and indeed must, resolve them”); Bartold v. Glendale Fed. Bank, 81 Cal. App. 4th 816, 829 (2000) (“when the merits of the claim are enmeshed with class action requirements, the trial court must consider evidence bearing on the factual elements necessary to determine whether to certify the class”). Wal-mart Stores, Inc. v. Dukes , 131 S. Ct. 2541, 2551-52 (2011) (citing Gen. Telephone Co. of S.W. v. Falcon, 457 U.S. 147, 102 S. Ct. 2364, 72 L. Ed. 2d 740 (1982)); see also Ellis v. Costco Wholesale Corp., 657 F.3d 970, 984 (9th Cir. 2011) (holding the district court erred by failing to conduct a “rigorous analysis” of the merits to determine whether the plaintiffs had established commonality under Rule 23); In re Hydrogen Peroxide Antitrust Litig., 552 F.3d 305, 318 (3d Cir. 2008) (class certification requires “thorough examination” of factual and legal allegations; “rigorous analysis may include a preliminary inquiry into the merits” and consideration of “the substantive elements of the plaintiffs’ case in chief).
To be fair however, many courts in California are reluctant to quickly dismiss a class certification effort. The abuse of class action lawsuits however, has caused many California courts to direct more attention to the actual facts underlying Plaintiffs’ claims in a class action, to determine whether Plaintiff can produce any substantive claim, prior to a lengthy and costly class action lawsuit.
“Food additives (direct, secondary, indirect) are essentially chemically derived, do not have a history of use in foods, and there is no general agreement among the scientific community with regard to their safety for the use that is proposed. Direct food additives are added to food for a technical purpose and have a lasting effect in the food (e.g., the antioxidants BHA/BHT). Secondary direct additives are added for a momentary technical effect and have no lasting effect in the food (e.g., antimicrobial agents, ozone, acidified sodium chlorite). Indirect food additives have the potential to become part of a food through processing or packaging but are not intended to be added to food for an intended technical effect (e.g., coatings and adhesives.)
“A GRAS substance is distinguished from a food additive on the basis of the common knowledge about the safety of the substance for its intended use.” As FDA discussed in a proposed rule to establish a voluntary notification program for GRAS substances (62 Fed. Reg. 18938; April 17, 1997), the data and information relied on to establish the safety of the use of a GRAS substance must be generally available (e.g., through publication in the scientific literature) and there must be a basis to conclude that there is consensus among qualified experts about the safety of the substance for its intended use. Thus, the difference between use of a food additive and use of a GRAS substance relates to the widespread awareness of the data and information about the substance, i.e., who has access to the data and information and who has reviewed those data and information.
1. For a food additive, privately held data and information about the use of the substance are sent by the sponsor to FDA and FDA evaluates those data and information to determine whether they establish that the substance is safe under the conditions of its intended use (21 CFR 171.1).
2. For a GRAS substance, generally available data and information about the use of the substance are known and accepted widely by qualified experts, and there is a basis to conclude that there is consensus among qualified experts that those data and information establish that the substance is safe under the conditions of its intended use. (proposed .170.36 (c)(4)(i)(C)).12