Vasserman v. Henry Mayo Newhall Memorial Hospital
65 F. Supp. 3d 932
C.D. Cal.2014Background
- Plaintiff Tanya Vasserman, a former hourly non-exempt nurse, filed a putative class action in Los Angeles Superior Court alleging state wage-and-hour violations (overtime, meal periods, wage statements, rounding, waiting-time penalties, UCL, and PAGA).
- Defendant Henry Mayo Newhall Memorial Hospital removed to federal court asserting (1) federal-question jurisdiction under LMRA § 301 preemption and (2) CAFA diversity jurisdiction (minimal diversity + > $5,000,000 amount in controversy).
- Defendant submitted HR declarations (class size, paychecks, average wage, two former employees domiciled out-of-state) and copies of collective bargaining agreements (CBAs) that contain overtime schemes and grievance/arbitration provisions.
- Plaintiff moved to remand for lack of subject-matter jurisdiction; defendant moved to dismiss for failure to arbitrate/grieve.
- The district court considered (a) whether LMRA § 301 completely preempted plaintiff’s state-law claims and (b) whether CAFA’s numerosity, minimal diversity, and amount-in-controversy requirements were satisfied. The court also ruled on evidentiary objections to removal declarations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 301 LMRA completely preempts Vasserman’s state-law wage-and-hour claims | Vasserman’s claims arise from nonwaivable California statutes (Labor Code, IWC Wage Orders) and do not require interpretation of CBAs | Newhall Memorial contends plaintiff’s claims are actually dependent on CBA terms (and statutory exemptions like Cal. Lab. Code § 514), so § 301 preemption creates federal-question jurisdiction | Not preempted: court held claims rest on independent state-law rights; any CBA reliance would be defensive and not sufficient to invoke §301 preemption (overtime and meal claims not substantially dependent on CBA interpretation) |
| Whether CBA grievance/arbitration clauses require dismissal/mandate arbitration (or convert claims to federal) | Vasserman argues the CBA grievance procedures do not clearly and unmistakably waive judicial remedies for statutory rights | Newhall argues mandatory grievance/arbitration provisions cover the asserted claims | Court held the grievance provisions do not clearly and unmistakably waive statutory rights; defensive reliance on CBAs does not create §301 preemption or automatically require arbitration |
| Whether CAFA numerosity and minimal diversity are satisfied | Vasserman contends defendant failed to show class composition/citizenship and that named declarants are in the class definitions | Newhall proffered HR records for ~2,530 potential class members and two former employees domiciled in other states to establish minimal diversity | Numerosity and minimal diversity satisfied: class size >100 and two declarants qualify as putative class members domiciled outside California, so CAFA minimal diversity exists |
| Whether CAFA amount-in-controversy (> $5,000,000) is met | Plaintiff argues defendant’s damage estimates rest on speculative, unsupported assumptions (100% violation rates, assumed overtime hours, full 30-day waiting penalties) and therefore fail the preponderance standard | Defendant provided aggregate damage calculations for unpaid overtime, meal breaks, wage-statement penalties, waiting-time penalties, and PAGA, relying on payroll averages and assumed violation rates | Amount in controversy not established: court discounted speculative assumptions and found defendant failed to prove by a preponderance that CAFA’s $5M threshold was met; remand granted |
Key Cases Cited
- Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1 (1983) (§301 preemption can convert state contract-dispute claims into federal law claims)
- Caterpillar Inc. v. Williams, 482 U.S. 386 (1987) (well-pleaded complaint rule: federal jurisdiction depends on plaintiff’s properly pleaded claims)
- Allis-Chalmers Corp. v. Lueck, 471 U.S. 202 (1985) (state-law claims are preempted when resolution requires interpretation of CBA terms)
- Burnside v. Kiewit Pacific Corp., 491 F.3d 1053 (9th Cir. 2007) (two-step LMRA preemption test: (1) is right created by state law or CBA, and (2) if state-law, is claim substantially dependent on CBA analysis)
- Cramer v. Consolidated Freightways, 255 F.3d 683 (9th Cir. 2001) (preemption only when resolution necessarily requires interpretation of an existing CBA provision)
- Abrego Abrego v. The Dow Chemical Co., 443 F.3d 676 (9th Cir. 2006) (burden on removing defendant to establish CAFA jurisdiction)
- Lowdermilk v. U.S. Bank National Ass'n, 479 F.3d 994 (9th Cir. 2007) (where complaint omits specific damages, defendant must prove amount in controversy by preponderance)