This case was last updated from Santa Clara County Superior Courts on 08/09/2019 at 03:05:23 (UTC).

Thomas v. RMH III Inc.

Case Summary

On 06/19/2018 Thomas filed a Labor - Other Labor lawsuit against RMH III Inc. This case was filed in Santa Clara County Superior Courts, Downtown Superior Court located in Santa Clara, California. The Judge overseeing this case is Walsh, Brian C. The case status is Disposed - Dismissed.

Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    ******0245

  • Filing Date:

    06/19/2018

  • Case Status:

    Disposed - Dismissed

  • Case Type:

    Labor - Other Labor

  • Court:

    Santa Clara County Superior Courts

  • Courthouse:

    Downtown Superior Court

  • County, State:

    Santa Clara, California

Judge Details

Judge

Walsh, Brian C

 

Party Details

Plaintiff

Thomas, Carlos

Defendants

Fairfield Imports, LLC

Vallejo Imports, LLC

Maverick Auto Group 2, LLC

Fairfield Imports Two, LLC

Fairfield CJD, LP

Fairfield Imports Three, LLC

RMH III Inc.

Not Classified By Court

Superior Court of California

Attorney/Law Firm Details

Plaintiff Attorney

Miller, Sebastian Lamar

Defendant Attorneys

Schaedel, John Peter

Scali, Christian Joseph

Not Classified By Court Attorney

Superior Court of CA, County of Santa Clara

 

Court Documents

Proof of Service: Summons DLR (Civil)

Proof of Service of Summons Complaint: Comment: Proof of Service of Summons/Complaint

Proof of Service: Summons DLR (Civil)

Proof of Service of Summons Complaint: Comment: Proof of Service of Summons/Complaint

Proof of Service: Summons DLR (Civil)

Proof of Service of Summons Complaint: Comment: Proof of Service of Summons/Complaint

Proof of Service: Summons DLR (Civil)

Proof of Service of Summons Complaint: Comment: Proof of Service of Summons/Complaint

Proof of Service: Summons DLR (Civil)

Proof of Service of Summons Complaint: Comment: Proof of Service of Summons/Complaint

Notice

Notice CMC reset from 10-5-18 to 10-26-18: Comment: CMC reset from 10/5/18 to 10/26/18

Notice: Related Cases

Notice of Related Case: Comment: Anthony Baker v. Vallejo CJD, LLC, Superior Court of California, County of TULARE, Case No. VCU273830; complaint filed 5/7/18; assigned to Hon. David C. Mathias; PENDING.

Proof of Service: Summons DLR (Civil)

Proof of Service: Comment: Proof of Service

Order: Deeming Case Complex

Order Deeming Case Complex and Staying Discovery and Responsive Pleading Deadline: Comment: Order Deeming Case Complex and Staying Discovery and Responsive Pleading Deadline signed/BCW

Summons: Issued/Filed

Summons to RMH III Inc.: Comment: Summons to RMH III Inc.

Summons: Issued/Filed

Summons to Maverick Auto Group 2, LLC: Comment: Summons to Maverick Auto Group 2, LLC

Summons: Issued/Filed

Summons to Fairfield Imports Three, LLC: Comment: Summons to Fairfield Imports Three, LLC

Summons: Issued/Filed

Summons to Fairfield Imports Two, LLC: Comment: Summons to Fairfield Imports Two, LLC

Summons: Issued/Filed

Summons to Fairfield Imports, LLC: Comment: Summons to Fairfield Imports, LLC

Summons: Issued/Filed

Summons to Fairfield CJD, LP: Comment: Summons to Fairfield CJD, LP

Complaint (Unlimited) (Fee Applies)

Complaint (Unlimited) (Fee Applies): Comment: Complaint

Civil Case Cover Sheet

Civil Case Cover Sheet: Comment: Civil Case Cover Sheet

Proof of Service: Summons DLR (Civil)

Proof of Service of Summons Complaint: Comment: Proof of Service of Summons/Complaint

21 More Documents Available

 

Docket Entries

  • 02/01/2019
  • View Court Documents
  • Conference: Case Management - Dismissal With Prejudice of Causes of Action 1-4 in First Amended Complaint (non-PAGA claims): Order Denying Stipulation Approving Settlement of Plaintiff's Individual PAGA Claim: Judicial Officer: Walsh, Brian C; Hearing Time: 10:00 AM; Cancel Reason: Vacated; Comment: (3rd CMC) PAGA. Discovery and responsive pleading deadline stayed, as of 7/17/18, when the case was deemed complex. First Amended Complaint filed 9/12/18. Related Case: Anthony Baker v. Vallejo CJD, LLC, Superior Court of California, County of TULARE, Case No. VCU273830; complaint filed 5/7/18; assigned to Hon. David C. Mathias; PENDING.

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  • 01/24/2019
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  • Dismissal - Entire Action - Dismissal - Entire Action - With Prejudice: Comment: Dismissal With Prejudice of Entire Action (including PAGA claim)

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  • 01/24/2019
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  • Order - Order Denying Stipulation Approving Settlement of Plaintiff's Individual PAGA Claim: Comment: Order Denying Stipulation Approving Settlement of Plaintiff's Individual PAGA Claim - signed/BCW

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  • 01/18/2019
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  • Dismissal - Dismissal With Prejudice of Causes of Action 1-4 in First Amended Complaint (non-PAGA claims): Comment: Dismissal With Prejudice of Causes of Action 1-4 in the First Amended Complaint (non-PAGA claims)

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  • 01/10/2019
  • Stipulation and Order - Comment: Stipulation and Proposed Order

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  • 12/05/2018
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  • Notice - Notice CMC reset from 1-11-19 to 2-1-19: Comment: CMC reset from 1/11/19 to 2/1/19

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  • 12/04/2018
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  • Notice - Notice CMC 1-11-19 at 10am in D1: Comment: CMC set for 1/11/19 at 10am in D1

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  • 11/30/2018
  • Conference: Case Management - Judicial Officer: Walsh, Brian C; Hearing Time: 10:00 AM; Result: Held; Comment: (2nd CMC)

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  • 11/30/2018
  • Minute Order

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  • 11/28/2018
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  • Statement: Case Management Conference - Joint CMC Statement: Comment: Joint Status Conference Statement

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19 More Docket Entries
  • 07/13/2018
  • View Court Documents
  • Civil Lawsuit Notice - Civil Lawsuit Notice: Comment: 1st CMC set for 10/5/18 at 10am in D1; assigned to Hon. Brian C. Walsh

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  • 06/19/2018
  • View Court Documents
  • Summons: Issued/Filed - Summons to Vallejo Imports LLC: Comment: Summons to Vallejo Imports LLC

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  • 06/19/2018
  • View Court Documents
  • Summons: Issued/Filed - Summons to RMH III Inc.: Comment: Summons to RMH III Inc.

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  • 06/19/2018
  • View Court Documents
  • Summons: Issued/Filed - Summons to Maverick Auto Group 2, LLC: Comment: Summons to Maverick Auto Group 2, LLC

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  • 06/19/2018
  • View Court Documents
  • Summons: Issued/Filed - Summons to Fairfield Imports Three, LLC: Comment: Summons to Fairfield Imports Three, LLC

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  • 06/19/2018
  • View Court Documents
  • Summons: Issued/Filed - Summons to Fairfield Imports Two, LLC: Comment: Summons to Fairfield Imports Two, LLC

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  • 06/19/2018
  • View Court Documents
  • Summons: Issued/Filed - Summons to Fairfield Imports, LLC: Comment: Summons to Fairfield Imports, LLC

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  • 06/19/2018
  • View Court Documents
  • Summons: Issued/Filed - Summons to Fairfield CJD, LP: Comment: Summons to Fairfield CJD, LP

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  • 06/19/2018
  • View Court Documents
  • Complaint (Unlimited) (Fee Applies) - Complaint (Unlimited) (Fee Applies): Comment: Complaint

    Read MoreRead Less
  • 06/19/2018
  • View Court Documents
  • Civil Case Cover Sheet - Civil Case Cover Sheet: Comment: Civil Case Cover Sheet

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Complaint Information

18CV 330245

Santa Clara - Civil

Electronically Filed

Sebastian L. Miller (SBN 265793) by Superior Court of CA, sebastian@ sebastianmillerlaw.com County of Santa Clara, SEBASTIAN MILLER LAW, P.C. on 9/12/2018 8:16 AM 3785 Via Nona Marie, Suite 203-E Reviewed By: R. Walker Carmel, CA 93923

Telephone: 408.348.1728 Case A o Facsimile: 408.716.3149 pe:

Attorneys for Plaintiff

CARLOS THOMAS, in his individual capacity and as a representative of the LWDA

SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA

CARLOS THOMAS, in his individual capacity Case No. 18CV 330245 and as a representative of the LWDA,

FIRST AMENDED COMPLAINT

Plaintiff,

PAGA REPRESENTATIVE ACTION

Failure To Provide Paid Rest Breaks Failure To Pay Minimum W ages Failure To Provide Premium Pay For Meal Periods

Civil Penalties Under The Labor Code PA GA — Penalties Under Labor Code § 2699(a)

PA GA — Penalties Under Labor Code § 2699(f)

V.

RMH III, INC.,

Defendant.

S

BASIS FOR AMENDING COMPLAINT

1. On May 16, 2018, Plaintiff Carlos Thomas (“Plaintiff’) gave notice to Defendant RMH III, Inc. (“Momentum Chevrolet”) and the California Labor and W orkforce Development Agency (“LWDA”) of his contention that Defendant had violated various sections of the California Labor Code. The notice stated that Plaintiff expected to bring an action under the California Private Attorneys General Act of 2004 (“PAGA”) and that Plaintiff’s PAGA action would seek civil penalties related to the Labor Code violations described in the notice. A copy of Plaintiff’s notice

was attached to Plaintiff’s initial complaint and is re-attached at Exhibit A hereto (the “Noltice”). 2. Plaintiff filed his initial complaint in this matter on June 19, 2018. The initial complaint noted it was likely that Plaintiff would file an amended complaint once 65 days had passed following his submission of the Notice to the LWDA. The 65-day deadline appears in Labor Code § 2699.3(a)(2)(B). Itis part of the administrative exhaustion requirement stated in Labor Code § 2699.3(a). Administrative exhaustion before the LWDA is a requirement to bring a claim under PAGA forviolation of any of the statutes set forth in Labor Code § 2699.5.

3. Plaintiff’s initial complaint also noted it was likely that the LWDA would choose not to investigate his claims and, also, that it was likely the LWDA would not provide Plaintiff with any response whatsoever to the Notice. 65 days have now passed since Plaintiff provided the Notice to the LWDA and to Momentum Chevrolet. As expected, the LWDA did not inform Plaintiff that it intended to investigate the allegations in the Notice.

4, A ccordingly, Plaintiff has satisfied the administrative exhaustion requirements set forth in both Labor Code § 2699.3(a) and Labor Code § 2699.3(c) and may bring a cause of action under PAGA that seeks penalties related to violations of the statutory provisions set forth in Labor Code § 2699.5. Plaintiff files this First Amended Complaint to bring such claims.

5. The statutory authority to file an amended complaint appears in Labor Code § 2699.3(a)(2)(C), which states that a party may, as a matter of right, amend an existing complaint to add claims that are subject to the exhaustion requirements set forth in Labor Code § 2699.3(a).

0. In addition, no answer, demurrer, or motion to strike Plaintiff’s initial complaint has been filed. So, amendment is also proper under Cal. Code Civ. Proc. § 472(a).

STATEMENT REGARDING RELATED CASE AND PLAINTIFE’S DESIRECLASSACTION SETTLEMENT

7. On or about July 18, 2018, Plaintiff received a notice of related case from the Scali Rasmussen law firm. The related case is captioned Baker v. Vallejo CJD, LLC, et al., Case No. VCU273830 (Tulare County Superior Court) (the “Baker Case”). Plaintiff understands that the

Baker Case is a wage and hour action that alleges similar claims against the same car dealerships that were defendants in his initial complaint, specifically: (i) Fairfield CJD, LP; (ii) Fairfield Imports, LLC; (ii1) Fairfield Imports Two, LLC; (iv) Fairfield Imports Three, LLC; (v) Maverick A uto Group 2, LLC; (vi) RMH III Inc.; and (vii) Vallejo Imports, LLC (together, the “Momentum D ealerships™).

8. Plaintiff understands that the Baker Case was filed in May 2018 and that counsel for Mr. Baker and the putative class filed a motion for preliminary approval of a class action settlement on July 11, 2018—roughly two months after Plaintiff filed his Notice with the LWDA (the “Pending Baker Settlement”). That settlement has not been approved and counsel for both Mr. Baker and the Momentum D ealerships have not been willing to provide Plaintiff with a copy of the Baker Settlement. However, Plaintiff understands that if the Pending Baker Settlement is approved then it would release claims on behalf of the LWDA and the putative “A ggrieved Employees” described in his initial complaint.

9. Plaintiff does not wish to participate in the Pending Baker Settlement and, if the settlement is approved, he intendspursue his individual claims against his former employer RMH III Inc., which does business as Momentum Chevrolet (hereafter “Momentum Chevrolet”).

10. But, in light of the Pending Baker Settlement, Plaintiff has narrowed the scope of this action. Plaintiff’s his initial complaint was a PAGA action brought against all the Momentum Dealerships on behalf of a large group of aggrieved employees. The sole defendant in this First Amended Complaint is Momentum Chevrolet and Plaintiff now brings his claims solely in an individual capacity and, with respect to the PAGA claims, on his own behalf and on behalf of the LWDA. Thus, it may be appropriate to re-designate this case as non-complex.

PARTIES

11. Plaintiff Carlos Thomas is a resident of San Jose, CA. From January 2016 through February 2018, Plaintiff was employed by RMH III, Inc. as a Sales Consultant and as an A ssistant Sales Manager. Plaintiff separated from employment for a few months in 2016 and 2017. Plaintiff

worked exclusively at the Momentum Chevrolet car dealership in San Jose. 12. Defendant RMH III Inc. is a Delaware corporation that owns Momentum Chevrolet. Momentum Chevrolet is based in San Jose, California.

SUMMARY OF PLAINTIFE’S FIRST AMENDED COMPLAINT

13. Plaintiff brings individual claims against Momentum Chevrolet. Specifically, during his employment Plaintiff was paid solely via commission payments and recoverable draws. The recoverable draws are advances against future commission payments and, therefore, also constitute “commissions” under Labor Code § 204.1.

14. The practice of paying Plaintiff solely via commissions caused Momentum Chevrolet to violate many sections of the California Labor Code.

15. First, Momentum Chevrolet did not provide Plaintiff with paid rest breaks or premium pay in lieu thereof. This violated Labor Code §§ 226.7 and 516 as well as Section 12 of Wage Order No. 7-2001 of the Industrial Welfare Commission (“Wage Order 7). See, Vaquero v. Stoneledge Furniture, LLC (2017) 9 Cal. App. 5th 98, 114-118 (collecting cases) (an employer that compensates “inside sales” employees solely via commissions fails to provide those employees with paid rest breaks because they cannot make a sale during a rest break and therefore cannot earn compensation during the rest break and, therefore, the rest break is unpaid).

16. The violations of Labor Code §§ 226.7, 516 and Section 12 of Wage Order 7 resulted in non-payment of wages to Plaintiff in every single pay period during the time that Plaintiff was employed. Plaintiff seeks to recover one hour of unpaid premium pay under Labor Code § 226.7 and Wage Order 7 for each day that he did not receive a paid rest break.

17. The failure to provide all premium pay due to Plaintiff upon his termination was a willful failure to pay wages. Therefore, Plaintiff seeks to recover waiting time penalties under Labor Code § 203.

18. Finally, the non-payment of premium pay also violated Labor Code §§ 203, 204, 226.7/Wage Order 7, 558, 1197.1, 1198, and 1199. Plaintiff seeks to recover penalties for those violations under Labor Code § 2699(a) and Labor Code § 2699(f)(2), as applicable. 19. Second, Momentum Chevrolet sometimes did not make available to Plaintiff an uninterrupted, meal period of thirty minutes in length. On the days that this occurred, the Plaintiff was never provided with premium pay. This violated Labor Code §§ 226.7 and 512 as well as Section 11 of Wage Order 7. Plaintiff seeks to recover one hour of unpaid premium pay under the applicable statute for each day that he did not receive an uninterrupted meal period.

20. The failure to provide all premium pay due to Plaintiff upon his termination was a willful failure to pay wages. Therefore, Plaintiff seeks to recover waiting time penalties under Labor Code § 203.

21. Finally, the non-payment of premium pay related to meal periods also violated Labor Code §§ 203, 204, 226.7/Wage Order 7, 558, 1197.1, 1198, and 1199. Plaintiff seeks to recover penalties for those violations under Labor Code § 2699(a) and Labor Code § 2699(f)(2), as applicable

22. Third, Momentum Chevrolet did not compensate Plaintiff for all hours worked. Specifically, it required Plaintiff to spend many hours per week attending meetings, opening and closing the dealerships, and performing other work that could not lead to the sale of a car (the “Non- Selling A ctivities”). But, Momentum Chevrolet did not provide Plaintiff with any separate compensation for Non-Selling A ctivities.

23. The failure to provide separate compensation for activities that could not result in the payment of a commission violated Section 4 of Wage Order 7. See, Villalpando v. Exel Direct Inc. (N.D. Cal. 2016) 161 F. Supp. 3d 873, 888-89 (collecting cases) (employees who are paid solely via commissions or via piece rate compensation must receive separate wages equivalent to at least the minimum wage for activities that cannot result in payment of commissions or piece compensation, even if the activities in question are somewhat related to practices that could result in a commission or piece rate pay).

24. Momentum Chevrolet’s conduct in failing to compensate for Non-Selling A ctivities resulted in the non-payment of wages. Plaintiff seeks to recover unpaid minimum wages under Labor

Code § 510 and Labor Code § 1194 as well as liquidated damages under Labor Code § 1194.2. 25. The failure to provide all minimum wages due to Plaintiff upon his termination was a willful failure to pay wages. Therefore, Plaintiff seeks to recover waiting time penalties under Labor Code § 203.

26. The non-payment of minimum wages also violated Labor Code §§ 203, 204, 558, 1194, 1197.1, 1198, 1199 and Section 20 of Wage Order 7. Plaintiff seeks to recover penalties for those violations under Labor Code § 2699(a) and Labor Code § 2699(f)(2), as applicable

27. Fourth, Momentum Chevrolet violated Labor Code § 226(a)(2) by failing to provide Plaintiff with pay stubs that specified the number of hours he worked during a given pay period (the “Non-Compliant Pay Stubs”). Plaintiff was injured as a result of the Non-Compliant Pay Stubs because he was not able to confirm that he was paid for all hours worked and was not able to confirm his total compensation exceeded the applicable minimum wage. The provision of Non-Compliant Pay Stubs gives rise to civil penalties under Labor Code § 226(e)(1) and Labor Code § 226.3. Plaintiff also seeks to recover those civil penalties under Labor Code § 2699(a).

28. Plaintiff additionally alleges by failing to pay him minimum wages for Non-Selling A ctivities, failing to provide paid rest breaks and failing to provide premium pay for missed meal and rest breaks, Momentum Chevrolet willfully failed to pay wages that were due. Its conduct was willful because Momentum Chevrolet violated law that was clearly established at the time the violation occurred. Specifically, the Vaquero and Villalpando cases, as well as their precursors, have been settled precedent for over a year. Therefore, Momentum Chevrolet violated Labor Code § 203 each time Plaintiff separated from employment without receiving those wages and premium pay. Based on the violation of Labor Code § 203, Plaintiff seeks to recover civil penalties under Labor Code § 203 directly and, derivatively under PAGA, pursuant to Labor Code § 2699(a).

ADMINISTRATIVE EXHUASTION

29. A claim under PA GA that seeks to recover penalties is subject to the pre-suit

administrative procedures described in Labor Code § 2699.3(a) and Labor Code § 2699.3(c).

30. Those procedures include the following requirements: the employee must provide written notice of the alleged violations to the LWDA and the employer, the employee mustLWDA, the employee must give the employer an opportunity to cure some of the alleged violations within thirty-three days of the date the notice is sent to it, and the LWDA has sixty days to decide whether to investigate an alleged violation of any of the statutes set forth in Labor Code § 2699.5.

31. Exhibit A to this complaint is a copy of the Notice that Plaintiff submitted to the LWDA on May 16, 2018. The Notice was filed online and sent to the Momentum Dealerships via certified mail. Plaintiff sent the $75 filing fee to the LWDA and the LWDA cashed the check.

32. Sixty-five days have passed since the postmark date of the Notice. The LWDA has not contacted Plaintiff and neither have the Momentum D ealerships.

33. Plaintiff has not been informed that Momentum Chevrolet has corrected its violations of Labor Code § 558 as allowed by Labor Code § 2699(c)(2)(A).

34. Thus, Plaintiff has exhausted all pre-suit procedures required under Labor Code § 26099.3(a) and Labor Code § 2699.3(c).

VENUE

35. Plaintiff seeks to recover statutory penalties from Momentum Chevrolet under Labor Code §§ 203, 226, 226.3, 558, 1197.1, 2699(a), and 2699(f)(2). The acts and omissions by Momentum Chevrolet that Plaintiff alleges to give rise to the penalties that are owed to Plaintiff all occurred in Santa Clara County, California, where Plaintiff was employed by Momentum Chevrolet. A ccordingly, under Code Civ. Proc. § 393(a), which governs venue for actions that seek the imposition of penalties, The Superior Court of Santa Clara County is a proper venue to recover penalties under the Labor Code generally and PAGA, specifically.

36. Venue is also proper under Code Civ. Proc. § 395 because RMH III, Inc. resides in Santa Clara County.

37. Venueis also proper under Code Civ. Proc. § 395.5 because the obligations Momentum Chevrolet owed to Plaintiff all arose in Santa Clara County and because RMH III, Inc. has its principal place of business in San Jose.

PLAINTIFE’S ROLE WITH MOMENTUM CHEVROLET

38. Between February 2016 and February 2018, Plaintiff was employed at RMH III, Inc. (Momentum Chevrolet) in San Jose, California. Plaintiff’s job titles were: (1) “Sales Consultant” (roughly: January 2016-April 2016; September 2016-October 2016; March 2017-March 2018); and (ii) “Assistant Sales Manager” (roughly: November 2016-February 2017).

39. Asa Sales Consultant Plaintiff primarily sold cars to customers. As an A ssistant Sales Manager, Plaintiff primarily closed customers—meaning he oversaw a group of Sales Consultants and was called in when customers were ready to sign a deal to purchase a car.

40. Plaintiff routinely worked overtime. He believes that he always worked over fifty hours per week and that he often worked substantially more hours than that. Time entry and swipe records that are maintained by Momentum Chevrolet will confirm the accuracy of Plaintiff’s estimate.

41. Plaintiff spent at least four hours per week on the Non-Selling A ctivities. Those activities included taking rest breaks, closing or opening a car dealership, attending team and group meetings, attending meetings with managers and other operational employees at the dealership.

42. Momentum Chevrolet had a written policy that required employees to take two rest breaks and one meal period every day. In practice, Plaintiff sometimes took rest breaks and sometimes took meal periods. However, the press of business frequently caused him to work through daily rest breaks and meal periods. On busy days, Plaintiff’s managers were not able to authorize and provide for all required meal periods and rest breaks. When this happened, Plaintiff did not receive premium pay for missed meal periods and rest breaks as required by Sections 11 and 12 of Wage Order 7,

43. During Plaintiff’s tenure he was paid exclusively via the following commissions: a recoverable draw of between $2,500-$4,000 per month as well as additional compensation above this

amount based on the sales of cars and achievement of other objectives related to bringing in revenue and profits for Momentum Chevrolet. Plaintiff’s average quarterly commissions from Momentum Chevrolet were approximately $15,000. Plaintiff received no wages from Momentum Chevrolet other than these commissions.

44, When Plaintiff did take a rest break, he never received any separate compensation for this rest break, which constitutes a Non-Selling A ctivity. In addition, he never received premium pay in the event he was unable to take a rest break or meal period. Finally, he never received any separate compensation for the other Non-Selling A ctivities besides rest breaks.

PLAINTIFF WAS NOT EXEMPT FROM THE REQUIREMENTS OF PAID REST

BREAKS, MINIMUM WAGE, AND UNPAID MEAL PERIODS

45. To the extent that any exemption from Wage Order 7’s requirements applied to Plaintiff, that exemption was set forth in section 3.D of Wage Order 7. This is known as the “commission sales” exemption and it applies to “any employee whose earnings exceed one and one- half (1.5) times the minimum wage if more than half of that employee’s compensation represents commissions.” See, Cal. Code Regs., tit. 8 § 11070, subs. 3.D.

46. Anemployee to whom the commission sales exemption applies need not be paid overtime wages, as otherwise required by sub-section 3.A of Wage Order 7. But, the commission sales exemption does not eliminate the requirements of minimum wages, meal periods, and rest breaks that are set forth, respectively, in Sections 4, 11 and 12 of Wage Order 7 as well as throughout the California Labor Code (including sections 226.7, 512 and 516).

47. Thus, Momentum Chevrolet was also required to pay Plaintiff minimum wages for all hours worked as required by Section 4 of Wage Order 7.

43. Momentum Chevrolet was also required to provide unpaid meal periods of at least thirty minutes in length each time Plaintiff employee worked five hourssecond break if Plaintiff worked more than ten hours. Plaintiff often worked more than ten hours in a day. If a meal period was not provided, then one hour of pay at Plaintiff’s regular rate of compensation was

owed for each workday that the meal period was not provided. This one hour of pay is commonly referred to as “premium pay” and it constitutes a wage. See, Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094, 1114,

49. Momentum Chevrolet was required to provide Plaintiff with a paid rest break of at least ten minutes in length for every four hours of work that the employee performed. If Momentum Chevrolet did not provide such a rest break, then Plaintiff was owed one hour of pay at his reqular rate of compensation was owed for each workday that the rest break was not provided. Under Murphy, this one hour of premium pay constitutes a wage.

FIRST CAUSE OF ACTION

Willful Failure To Provide Paid Rest Breaks (Labor Code §§ 226.7 and 516; Wage Order 7)

Plaintiff hereby incorporates by reference Paragraphs 1 through 49 of this First Amended Complaint as if fully set forth herein and alleges the following cause of action.

50. Plaintiff was employed by Defendant RMH III, Inc. (Momentum Chevrolet). Since Plaintiff was paid solely on a commission basis, he could not earn any compensation during a rest break. Rather, the only compensation he earned was via a commission generated by selling a car. During a rest break, one cannot sell a car. Thus, when rest breaks were provided to Plaintiff, those rest breaks were unpaid. This policy violates California law because Plaintiff was not exempt from the rest break requirements that are set forth in Section 12 of Wage Order 7 as well as throughout the California Labor Code (including sections 226.7, 512 and 516). The case law that requires employers to provide commissioned employees with separate compensation for rest breaks (or premium pay for those unpaid rest breaks) is clearly established. See, Vaquero v. Stoneledge Furniture, LLC (2017) 9 Cal. App. 5th 98, 114-118; Bluford v. Safeway Stores, Inc. (2013) 216 Cal.App.4th 864, 871-72; Armenta v. Osmose, Inc. (2005) 135 Cal.App.4th 314, 323. Momentum Chevrolet uniformly violated these statutes and orders when compensating Plaintiff because it never provided him with separate compensation for rest breaks and never provided him with premium pay for missed rest breaks.

Under Labor Code §§ 226.7 and Wage Order 7, Plaintiff is owed one hour’s pay at his regular rate of compensation for each day that he worked for Momentum Chevrolet. Plaintiff’s regular rate of compensation was approximately $40. In addition, Plaintiff is owed prejudgment interest under Labor Code § 218.6 at the rate stated in Civil Code § 3289(b). He is also owed attorney’s fees under Code of Civil Procedure § 1021.5 because his action spurred the Momentum D ealerships to enter into the Pending Baker Settlement and to reform their compensation practices.

SECOND CAUSE OF ACTION

Willful Failure To Pay Minimum W ages (Labor Code §§ 510, 1194 and 1194.2; Wage Order 7)

Plaintiff hereby incorporates by reference Paragraphs 1 through 50 of this First Amended Complaint as if fully set forth herein and alleges the following cause of action.

51. Momentum Chevrolet engaged in a separate form of wage theft when it required Plaintiff to engage in Non-Selling A ctivities without providing him with any additional compensation for doing so. Since Plaintiff was paid exclusively on commissions, any time that he spent working on a task that could not lead to the sale of a car was effectively unpaid time. This constitutes a failure to pay wages that violates Labor Code § 510, 558, 1194, 1194.2, 1197, 1197.1, 1198 and Section 4 of Wage Order 7. See, Villalpando v. Exel Direct Inc. (N.D. Cal. 2016) 161 F. Supp. 3d 873, 838-89 (collecting cases). Momentum Chevrolet violated these laws by requiring Plaintiff to engage in Non- Selling Activities (the “Non-Selling Time Requirements”). The Non-Selling Time Requirements resulted in underpaid wages in violation of Labor Code §§ 510 and 1194 as well as Section 4 of Wage Order 7. Existing law clearly prohibited the Non-Selling Time Requirements and, therefore, Momentum Chevrolet willfully failed to pay minimum wages in violation of Labor Code § 1194.2. Plaintiff is owed at least $5,000 in minimum wages. In addition, Plaintiff is owed prejudgment interest under Labor Code § 218.6 at the rate stated in Civil Code § 3289(b). He is also owed attorney’s fees under Labor Code § 1194.

THIRD CAUSE OF ACTION

Willful Failure To Pay Premium Pay For Missed Meal Periods (Labor Code §§ 226.7 and 516; Wage Order 7)

Plaintiff hereby incorporates by reference Paragraphs 1 through 51 of this First Amended Complaint as if fully set forth herein and alleges the following cause of action.

52. The press of business at D efendant frequently caused Plaintiff to forego statutory first meal periods and second meal periods, which are required after five and ten hours of work, respectively. Plaintiff never received premium pay when he was forced to work through a meal period, as required by Labor Code §§ 226.7 and Section 11 of Wage Order 7. Plaintiff is owed one hour’s pay at his regular rate of compensation for nearly each day that he worked for Momentum Chevrolet. In addition, Plaintiff is owed prejudgment interest under Labor Code § 218.6 at the rate stated in Civil Code § 3289(b). He is also owed attorney’s fees under Code of Civil Procedure § 1021.5 because his action spurred the Momentum Dealerships to enter into the Pending Baker Settlement and reform their compensation practices.

FOURTH CAUSE OF ACTION

Civil Penalties (Labor Code §§ 203, 226, 226.3, 558, 1197.1)

Plaintiff hereby incorporates by reference Paragraphs 1 through 52 of this First Amended Complaint as if fully set forth herein and alleges the following cause of action.

53. By failing to pay minimum wages, failing to provide paid rest breaks, and failing to provide premium pay for missed meal periods, Defendant willfully failed to pay Plaintiff all wages that were due to him. Plaintiff separated from employment twice and, therefore, is owed two sets of waiting time penalties under Labor Code § 203. Plaintiff estimates that each penalty is $10,000— roughly $333.33 per day for thirty days. In addition, Defendant did not provide Plaintiff with pay stubs that showed the number of hours worked by Plaintiff in a given pay period. These non-

compliant pay stubs violated Labor Code § 226(a)(2). Plaintiff injured as a result of the non- compliant pay stubs because he was not able to confirm that he was paid for all hours worked and was not able to confirm his total compensation exceeded the applicable minimum wage. The provision of non-compliant pay stubs gives rise to civil penalties under Labor Code § 226(e)(1) and Labor Code § 226.3. Further, Defendant’s failure to pay wages also violated Labor Code §§ 558 and 1197.1. Plaintiff seeks to recover penalties for violations of each of those statutes. Plaintiff is owed attorney’s fees under Labor Code § 226(¢)(1).

FIFTH CAUSE OF ACTION

PA GA Action Seeking Penalties Under Labor Code § 2699(a) (Civil Penalties For Violations Of Labor Code §§ 203, 226, 226.3, 558, 1197.1, 1199)

Plaintiff hereby incorporates by reference Paragraphs 1 through 53 of this First Amended Complaint as if fully set forth herein and alleges the following cause of action.

54. Asdescribed in the Notice and this First Amended Complaint, Defendant violated Labor Code §§ 203, 226, 226.3, 558, 1197.1 and 1199/Wage Order 7. Plaintiff seeks, on his own behalf and acting in a representative capacity on behalf of the State of California, the applicable civil penalties set forth in Labor Code §§ 203, 226, 226.3, 558, 1197.1 and Wage Order 7. Plaintiff also seeks his reasonable attorney’s fees and costs under Labor Code § 2699(g)(1) and Cal. Civ. Code § 1021.5. For the avoidance of doubt, the civil penalties at issue are as follows.

a. Labor Code § 203: Defendant’s willful failure to pay minimum wages, willful failure to provide premium pay for missed and unpaid rest breaks, and willful failure to provide premium pay for missed meal periods give rise to a civil penalty under Labor Code § 203. The penalty is equal to thirty days’ pay for each of the two times that Plaintiff separated from employment.

b. Labor Code § 226(e)(1): Plaintiff was harmed by the Non-Compliant Pay Stubs. Labor Code § 226(e)(1) sets forth a civil penalty of $50 for the first pay period during which the Plaintiff received a Non-Compliant Pay Stub and $100 for each subsequent pay period that the Plaintiff received a Non-Compliant Pay Stub.

c. Labor Code § 226.3: Defendant provided Non-Compliant Pay Stubs in violation of Labor Code § 226. This violation is actionable under Labor Code § 226.3, which provides a civil penalty of $250 per violation of Labor Code § 226.

d. Labor Code § 558 (unpaid wages): Defendant’s failure to provide paid rest breaks violated Labor Code § 516 and Wage Order 7. Defendant’s failure to provide premium pay for missed meal periods violated Labor Code § 512 and Wage Order 7. Defendant’s failure to pay minimum wages violated Labor Code § 510 and Wage Order 7. Plaintiff is owed unpaid wages and those wages are recoverable as a civil penalty under Labor Code § 558(a)(1)(2).

e. Labor Code § 558 ($50/$100): In addition to unpaid wages, the civil penalty set forth in Labor Code § 558(a)(1)-(2) also provides for $50 for the first pay period for which Plaintiff was underpaid and $100 for each subsequent pay period.

f. Labor Code § 1197.1 (wages, liquidated damages, and penalties): Defendant’s willful failure to pay minimum wages for Non-Selling A ctivities violated Labor Code §§ 203, 1194 and 1194.2 and Wage Order 7. Defendant owes Plaintiff wages, liquidated damages and waiting time penalties. Those unpaid wages, liquidated damages and waiting time penalties are recoverable as a civil penalty under Labor Code § 1197.1(a)(1)-(2).

g. LaborCode § 1197.1 ($100/$250): The civil penalty set forth in Labor Code § 1197.1(a)(1)-(2) also provides for $100 for the first pay period for which Plaintiff was underpaid and $250 for each underpaid employee for each subsequent pay period.

SIXTH CAUSE OF ACTION

PAGA Action Seeking Penalties Under Labor Code § 2699(f)(2)

(Civil Penalties For Violations Of Labor Code §§ 204, 226.7, 510, 1194, 1197, 1198)

Plaintiff hereby incorporates by reference Paragraphs 1 through 54 of this First A mended Complaint as if fully set forth herein and alleges the following cause of action:

55. Asdescribed in the Notice and this First Amended Complaint, Defendant violated Labor Code §§ 204, 226.7, 510, 1194, 1197 and 1198. Plaintiff seeks, on his own behalf and acting in a representative capacity on behalf of the State of California, the applicable civil penalties set forth in Labor Code §§ 204, 226.7, 510, 1194, 1197 and 1198. Plaintiff also seeks his reasonable attorney’s fees and costs under Labor Code § 2699(g)(1) and Cal. Civ. Code § 1021.5. Forthe avoidance of doubt, the civil penalties at issue are those set forth in Labor Code § 2699(f)(2) based on the Momentum Dealerships’ violation of the sections of the Labor Code described below. Plaintiff seeks the civil penalty set forth in Labor Code § 2699(f)(2), which is $100 for the first pay period that a given Labor Code section was violated and $200 for each subsequent pay period that a given Labor Code section was violated.

a. Labor Code § 204: Labor Code § 204 requires that wages be paid within certain intervals and generally within a few weeks after an employee performs labor for an employer. Defendant did not comply with Labor Code § 204 when it failed to timely pay minimum wages for Non-Selling A ctivities, failed to timely pay premium pay for missed meal periods, and failed to timely pay premium pay for unpaid rest breaks.

b. Labor Code § 226.7: Labor Code § 226.7 requires that employees receive paid rest breaks and unpaid meal periods (or premium pay in lieu thereof). Defendant did not comply with Labor Code § 226.7 when it failed to timely pay premium pay for missed meal periods and unpaid rest breaks.

c. Labor Code § 510: Defendant violated Labor Code § 510 when it failed to pay

minimum wages for the Non-Selling A ctivities. d. Labor Code § 1194: Labor Code § 1194 requires that all employees be paid minimum wages for any work they perform for an employer. Defendant did not comply with Labor Code § 1194 when it failed to timely pay minimum wages for Non-Selling A ctivities.

e. Labor Code § 1194.2: Defendant violated Labor Code § 1194.2 when it willfully failed to pay minimum wages for the Non-Selling A ctivities.

f. Labor Code § 1197: Defendant violated Labor Code § 1197 when it failed to pay minimum wages for the Non-Selling A ctivities.

g. Labor Code § 1198: Defendant violated Labor Code § 1198 when it violated Wage Order 7 as described above.

PRAYERS FOR RELIEF

WHEREFORE, Plaintiff prays that the Court enter judgment against D efendant as follows.

1. On Plaintiff’s First Cause Of Action: That Defendant pay Plaintiff at least $16,000 for violations of Labor Code §§ 226.7 and 516 and Section 12 of Wage Order 7. Plaintiff arrives at this amount based on an estimated number of 400 days of work for Defendant and an estimated “regular rate of compensation” of $40/hour.

2. On Plaintiff’s Second Cause Of Action: That Defendant pay Plaintiff at least $5,000 forviolations of Labor Code §§ 510, 1194, and 1194.2. Plaintiff arrives at this amount based on an estimate of 4 hours of work per week when he engaged in Non-Selling A ctivities, 70 weeks of work, and an average minimum wage of $10 per hour.

3. On Plaintiff’s Third Cause Of Action: That Defendant pay Plaintiff at least $16,000 for violations of Labor Code §§ 226.7 and 512 and Section 11 of Wage Order 7. Plaintiff arrives at this amount based on an estimated number of 400 days when he is owed premium pay for a missed meal period and an estimated “regular rate of compensation” of $40/hour.

4, On Plaintiff’s Fourth Cause Of Action: That Defendant pay Plaintiff at least $30,000. Plaintiff arrives at that amount based on: (a) two separate penalties under Labor Code § 203, each in

the amount of $10,000; (b) penalties under Labor Code §§ 226, 226.3, 558 and 1197.1 in the combined amount of $10,000 (or more).

d. On Plaintiff’s Fifth Cause Of Action: That Defendant pay Plaintiff and the LWDA civil penalties under PA GA—Labor Code § 2699(a)—in the total amount of $10,000 (or more) for violations of the following sections of the Labor Code: Labor Code §§ 203, 226(e)(1), 226.3, 558, 1197.1, 1199 (actionable under Section 20 of Wage Order 7). These penalties are split 75% to the LWDA and 25% to Plaintiff.

0. On Plaintiff’s Sixth Cause Of Action: That Defendant pay Plaintiff and the LWDA civil penalties under PA GA—Labor Code § 2699(f)(2)—in the total amount of $10,000 (or more) for violations of the following sections of the Labor Code: Labor Code §§ 204, 226.7, 510, 1194, 1194.2, 1197, 1198. These penalties are split 75% to the LWDA and 25% to Plaintiff.

7. That the Court award at least $5,000 of prejudgment interest as follows: (a) interest under Labor Code § 218.6 on all unpaid wages at the rate stated in Civil Code § 3289(b); (b) interest under Civil Code § 3287(a) on all amounts of unpaid premium pay for rest breaks that were not provided; and (c) the Court, in its discretion, award prejudgment interest under Civil Code § 3287(b) on all claims based on contract in this First Amended Complaint.

8. An award of reasonable attorney’s fees and costs under Labor Code §§ 226(e)(1), 1194, 2699(g)(1), and Civil Code § 1021.5, in the amount of $65,000 as of the date of this First Amended Complaint ($2,000 in costs and 125 hours of attorney time), with those fees and costs continuing to accrue from the date of this First Amended Complaint.

9. Pursuant to Code of Civil Procedure § 425.10(b), Plaintiff hereby prays that the Court enter judgment in the total amount of $155,000, sub-divided as follows: (a) $70,000 payable to Plaintiff as damages and interest as described above; (b) $65,000 of attorney’s fees and costs under Labor Code §§ 226(e)(1), 1194, 2699(g)(1), and Civil Code § 1021.5, and (c) $20,000 as civil penalty under PAGA that is payable 75% to the LWDA and 25% to Plaintiff.

10. Foran award to Plaintiff of such other and further legal and equitable relief as the

Court deems just and proper. Dated: September 12, 2018 SEBASTIAN MILLER LAWw, P.C.

By: /s/ Sebastian L. Miller Sebastian L. Miller Attorneys for Plaintiff CARLOS THOMAS, in his individual capacity and as a representative of the LWDApage 18 can't be parsed

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