Cochran v. Schwan's Home Service, Inc.
228 Cal. App. 4th 1137
Cal. Ct. App.2014Background
- Plaintiff Colin Cochran filed a putative class action on behalf of ~1,500 Schwan’s customer service managers alleging failure to reimburse work-related personal cell‑phone expenses in violation of Labor Code § 2802 and related claims.
- Cochran sought class certification; the trial court initially found the class ascertainable and typical but reserved on superiority.
- Defendant Schwan’s opposed certification, arguing individualized inquiries into each class member’s cellphone plan and payments would predominate (e.g., unlimited plans, third‑party payments, plan changes for work).
- Cochran offered statistical and survey-based methods (expert Dr. G. Michael Phillips) to establish liability and damages for the class, including a draft survey and an alternative $2/day damages assumption.
- The trial court denied certification, reasoning liability under § 2802 required individualized proof that each class member actually incurred extra expense and that survey sampling could not prove liability; Cochran appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 2802 requires reimbursement when employees must use personal cell phones for work | Cochran: employer must reimburse where employee was required to use personal cell and was not reimbursed; sampling can establish liability/damages | Schwan’s: liability requires individualized proof that employee incurred an extra expense (e.g., limited minutes, payment by third party, plan changes) | Reversed trial court: § 2802 requires reimbursement when use is required; liability proven by showing required use and lack of reimbursement; plan details and third‑party payment are irrelevant to liability |
| Whether individual plan details (unlimited plans, plan type) preclude class treatment | Cochran: plan details go to damages, not to liability; common issues predominate | Schwan’s: plan variability means individualized inquiries will predominate and overwhelm class adjudication | Court: plan specifics affect damages but not liability; class certification denial based on plan variability was legal error; remand to reconsider certification |
| Whether third‑party payment of phone bill defeats a § 2802 claim | Cochran: irrelevant — requirement to use personal phone creates expense regardless who pays | Schwan’s: third‑party payment means employee did not incur expense, so no liability | Court: third‑party payment does not negate that an employee incurred an expense for § 2802 purposes; employer cannot shift operating costs to employees |
| Use of statistical sampling/surveys to prove liability or damages at certification | Cochran: surveys and sampling can establish classwide liability/damages; offered expert plan | Schwan’s: sampling cannot prove liability because there is no uniform pattern/practice; individualized proofs required | Court: sampling may be appropriate; trial court must apply Duran principles and assess the proposed statistical plan on remand; cautioned sampling for liability must be used with care |
Key Cases Cited
- Duran v. U.S. Bank Nat’l Assn., 59 Cal.4th 1 (discussion of when statistical sampling/surveys may be used at class certification)
- Gattuso v. Harte‑Hanks Shoppers, Inc., 42 Cal.4th 554 (purpose of § 2802 to prevent employers shifting operating costs to employees)
- Brinker Restaurant Corp. v. Superior Court, 53 Cal.4th 1004 (class certification principles where common liability questions may permit class despite individualized damages)
- Knapp v. AT&T Wireless Servs., Inc., 195 Cal.App.4th 932 (standard for appellate review of class certification denials)