Bernstein v. Virgin America, Inc.
227 F. Supp. 3d 1049
N.D. Cal.2017Background
- Plaintiffs are current or former California‑based Virgin America flight attendants who allege unpaid wages for pre/post‑flight and turn time, training, reserve, drug testing, and incident‑report time; they also assert missed meal/rest breaks, overtime, inaccurate wage statements, waiting‑time penalties, and related UCL/PAGA claims.
- Virgin is headquartered in Burlingame, California; it trains attendants in California, received state subsidies for training, and a very high percentage of its daily flights arrive/depart California airports.
- Virgin pays under a credit system that awards block‑time credit, deadhead credit, minimum duty credits in limited circumstances, and flat credits for some nonflight activities (drug testing, some training, reserve); non‑block duty and incident‑report time often are not separately paid and wage statements do not show duty or block hours.
- The Court previously certified a California‑based class and sub‑classes; the Class claims are limited to time worked within California, while two subclasses seek recovery for time inside and outside California.
- Virgin moved for summary judgment arguing (1) California law does not apply extraterritorially or to airspace work, (2) Dormant Commerce Clause and federal preemption (FAA/ADA) bar Plaintiffs’ break claims, and (3) Virgin’s pay system and wage statements comply with California law.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Applicability of California law (job situs/extraterritorial) | California law applies because plaintiffs are California residents paid in CA, Virgin is CA‑headquartered, policies/decisions made in CA, and wrongful conduct occurred in CA | Job‑situs (must work exclusively/principally in CA) or presumption against extraterritoriality bars CA law for out‑of‑state work | Rejected job‑situs as dispositive; CA law applies to work and wrongful conduct in CA; extraterritorial presumption does not bar claims based on policies devised/implemented in CA; out‑of‑state break violations remain subject to presumption if challenged |
| Dormant Commerce Clause | Applying CA law is permissible given Virgin’s substantial ties to CA and no proven substantial burden on interstate commerce | Application would force compliance with myriad state laws and unduly burden national airline operations | Rejected; Virgin failed to show a clearly excessive burden; Sullivan/precedent support even‑handed state regulation supplementing FLSA |
| Federal preemption of meal/rest break claims (FAA and ADA) | State break laws regulate employment, not airway safety or routes; can be accommodated (e.g., additional staffing) | FAA occupies aviation safety field and conflicts with CA breaks; ADA preempts laws "related to" prices/routes/services | FAA: no field or conflict preemption (federal regs not sufficiently dense; compatibility feasible). ADA: preemption rejected under Dilts line—CA break laws not preempted |
| Compliance with CA wage law (compensation for hours worked & wage statements) | Virgin’s credit system fails to compensate all hours worked (non‑block duty, incident reports); wage statements omit required info and reflect a centralized policy | Credit system and flat credits satisfy pay obligations; wage‑statement format reflects system and is made in good faith | Denied as to compensation for non‑block duty time and incident reports; summary judgment granted for pay claims where credit system expressly covers activity (drug tests, training, reserve); denied as to wage‑statement claims (knowing/intentionally deficient) |
| Overtime and break eligibility (time in air/airspace) | CA law can apply to work performed in or departing/arriving to CA; Plaintiffs have instances of qualifying days within CA | Time in federal airspace isn’t CA; law cannot apply while working in the air | Rejected: CA law can apply to work while in airspace when wrongful conduct/policies originate in CA and plaintiffs have triable instances of qualifying workdays in CA |
| San Francisco Minimum Wage Ordinance coverage | Plaintiffs worked at/near SFO and thus covered | Plaintiffs’ work and training locations (SFO, training facility) lie outside SF city limits; ordinance requires work within city geographic boundaries | Granted for Virgin: Plaintiffs failed to show they performed the requisite two hours per week within the City, so SFMWO claims dismissed |
Key Cases Cited
- Tidewater Marine W., Inc. v. Bradshaw, 14 Cal.4th 557 (Cal. 1996) (articulates residency/pay/job‑situs factors but does not make job situs solely dispositive)
- Sullivan v. Oracle Corp., 51 Cal.4th 1191 (Cal. 2011) (endorses multifactor approach; CA law applies to work performed in California even for nonresidents)
- Dilts v. Penske Logistics, LLC, 769 F.3d 637 (9th Cir. 2014) (limits preemption under "related to" language; meal/rest laws not preempted)
- Nat'l Fed'n of the Blind v. United Airlines Inc., 813 F.3d 718 (9th Cir. 2016) (field‑preemption analysis requires specific delimitation of the regulatory field)
- Ventress v. Japan Airlines, 747 F.3d 716 (9th Cir. 2014) (conflict preemption framework; compliance with both state and federal rules required for preemption)
- Pike v. Bruce Church, Inc., 397 U.S. 137 (U.S. 1970) (Dormant Commerce Clause balancing test for even‑handed regulations)
- Bibb v. Navajo Freight Lines, Inc., 359 U.S. 520 (U.S. 1959) (invalidated state regulation that directly conflicted with another state's requirement and impeded interstate transport)
- Pacific Merch. Shipping Ass'n v. Aubry, 918 F.2d 1409 (9th Cir. 1990) (FLSA savings clause permits states to supplement federal minimums; supports coexistence of federal and state wage laws)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (U.S. 1986) (summary judgment standard on genuine dispute of material fact)
- Celotex Corp. v. Catrett, 477 U.S. 317 (U.S. 1986) (movant's initial burden at summary judgment)