Seyfarth Shaw LLP | www.seyfarth.com Litigating CA Wage & Hour Class and PAGA Actions (24th Edition) 111 explained that the party in a PAGA action is the aggrieved employee, and thus rejected the plaintiff’s argument that the State of California is the real party in interest in a PAGA action. In Robinson v. Southern Counties Oil Co.,562 the Court of Appeal extended this principle to hold that a plaintiff who had previously opted out of prior PAGA/class settlement could not bring a separate PAGA action.563 These arguments were also raised in (not uncommon) circumstances where an employer is faced with multiple PAGA actions and reaches a settlement in one case that would resolve the claims for the other cases too. In such instances, the plaintiff(s) who were not part of the settlement might object and attempt to intervene in the case that was settled. In August 2024, the California Supreme Court affirmed the decisions of the trial court and court of appeal and held that that PAGA plaintiffs do not have standing to intervene in other PAGA actions.564 Separate from the res judicata argument, however, an employer may seek to argue that when the class release provides that class members are releasing any PAGA claims that could be based on the same underlying facts as the Labor Code claims, the doctrine of release precludes any class member from pursuing PAGA relief. In other words, even if there is no sort of res judicata bar, basic contract principles of release would prevent someone who agreed to the release from suing on the released claim. This argument was approved in a federal decision, Waisbein v. UBS Financial Services Inc.,565 which is not binding on California courts but is persuasive authority.566 In 2020, the California Supreme Court eliminated the ability of employers to attack a PAGA action on the basis that the named plaintiff already settled his underlying Labor Code claims. In Kim v. Reins International, the plaintiff filed a class action alleging that he and other managers were misclassified. The complaint also included a representative claim under PAGA. Reins successfully compelled arbitration of the plaintiff’s individual claims and the trial court stayed the PAGA claim while the individual claims were litigated. Eventually, the plaintiff agreed to settle his individual claims in arbitration and the settlement agreement included a carve out for his pending PAGA claims. The employer then successfully moved for summary judgment on the basis that the plaintiff had been “completely redressed” and was no longer an “aggrieved employee” so, consequently, could not proceed with the PAGA claim. The Court of Appeal agreed with the employer’s reasoning.567 But the California Supreme Court came to a different conclusion. Reins held that a PAGA plaintiff can proceed even if his own individual injury has been resolved. The PAGA plaintiff maintains his “aggrieved” status and possesses standing to sue as long as he has claim. The Ninth Circuit reasoned that the fact that both actions used California Labor Code section 1198 and PAGA as the legal mechanisms to assert the claims “sa[id] nothing about the factual predicate for each case” and that any similarity between the actions was “superficial” and thus insufficient to justify the release of the suitable seating claims by the settlement agreement. Id. at 619-20. 562 Robinson v. Southern Counties Oil Co., 53 Cal. App. 5th 476 (2020). 563 Robinson also held that the plaintiff lacked standing to pursue PAGA claims for period not covered by settlement, as he was no longer employed by the defendant at that time. Id. 564 Turrieta v. Lyft, Inc., 16 Cal. 5th 664, 705 (2024) 565 Waisbein v. UBS Financial Services Inc., 2007 WL 4287334, at *8-9 (N.D. Cal. Dec. 5, 2007) (“[T]he question is whether the Bowman class members voluntarily entered into an agreement in which they accepted a monetary benefit from UBS in exchange for not pursuing their claims under PAGA. The indisputable answer to that question is ‘yes.’”). 566 Harris v. Investor’s Bus. Daily, Inc., 138 Cal. App. 4th 28, 34 (2006) (“even unpublished federal opinions have persuasive value in [the superior] court”). 567 Kim v. Reins Int'l California, Inc., 18 Cal. App. 5th 1052, 1056 (2017).
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