Opinion
Putative class representative Obaidul H. Pirjada filed a complaint on behalf of himself and a proposed class of all security guards who had been employed in California by Pacific National Security, Inc. (Pacific National), during the immediately preceding four years, asserting causes of action for failure to provide meal and rest periods and various other wage-and-hour claims, as well as a claim for unfair business practices. After Pirjada settled his individual claim through direct negotiations with Pacific National’s chief executive officer, respondent superior court granted Pirjada’s counsel leave to amend the complaint to name a new class representative but denied his motion to compel precertification discovery to identify a suitable class representative. Counsel for Pirjada, purportedly on behalf of his client, has petitioned for a writ of mandate challenging the order denying discovery. We deny the petition and vacate the previously ordered stay of the order to show cause regarding dismissal, which may proceed pursuant to the requirements of La Sala v. American Sav. & Loan Assn. (1971)
FACTUAL AND PROCEDURAL BACKGROUND
On December 13, 2010 Pirjada filed a complaint, and on January 10, 2011 a first amended complaint, against Pacific National for failure to provide meal and rest periods (Lab. Code, §§226.7, 512), failure to pay overtime and straight time wages (Lab. Code, §§510, 1194), collecting or receiving employee wages (Lab. Code, § 221), failure to timely pay wages (Lab. Code, § 203), failure to maintain and provide accurate itemized pay statements (Lab.
Pacific National answered the first amended complaint on February 24, 2011. On March 10, 2011 Piijada served by United States mail on counsel for Pacific National a request for production of documents, set one, containing 29 numbered requests, including request No. 27—“all documents and electronic records which set forth the names and the last known addresses for security guards [employed by you at any time during the four-year period prior to December 13, 2010] whose employment with you terminated”—and request No. 29—“all documents and electronic records which set forth the names and last known addresses for security guards employed by you [at any time during the four-year period prior to December 13, 2010].” Pacific National did not object or otherwise respond to the document request within 30 days as required by Code of Civil Procedure section 2031.260, did not seek an extension of time to respond and did not move for a protective order.
In March 2011 N. Joe Ramirez, chief executive officer of Pacific National, negotiated a settlement of Pirjada’s claims directly with Pirjada. According to Ramirez’s declarations submitted in. subsequent proceedings in the superior court, Pirjada approached him at a hearing for unemployment benefits in January 2011, said he was no longer interested in maintaining the class action lawsuit against Pacific National and asked Ramirez to contact his attorney about a settlement. Ramirez explained he negotiated directly with Pirjada only after his efforts to pursue settlement with Pirjada’s lawyers at Westrup Klick LLP were unsuccessful. On March 15, 2011 Pirjada signed and sent to Westrup Klick a letter stating, “I have resolved the above case [(Pirjada v. Pacific National Security, BC451138)]. Please immediately dismiss my claims in the above Lawsuit with prejudice. Enclosed, please find my settlement agreement and a check for your services.”
Pirjada’s counsel did not dismiss the lawsuit. Instead, on May 2, 2011, relying primarily on Best Buy Stores, L.P. v. Superior Court (2006)
Pacific National opposed the motion and separately filed its own motion to dismiss Pirjada’s complaint with prejudice pursuant to Rule 3.770 based on the parties’ settlement. In its tentative ruling for the hearing on May 26, 2011, the superior court characterized the two motions as, in effect, “cross motions seeking alternative relief in light of a settlement reached by the named plaintiff and the defendant, independently of counsel.”
As to the motion to dismiss, the court’s tentative ruling noted, although Pirjada had joined in Pacific National’s request to dismiss the action, Rule 3.770(a) requires trial court approval before a class action may be dismissed. The court then explained, “The fact that a named plaintiff individually settles his claims does not divest him or his counsel of their [fiduciary] obligations to the putative class members. If the trial court concludes that the named plaintiff can no longer represent the claim, ‘It should at least afford plaintiffs the opportunity to amend their complaint, to redefine the class, or to add new individual plaintiffs, or both, in order to establish a suitable representative,’ ” citing La Sala, supra,
With respect to the motion for class notice, the court distinguished Best Buy, as well as CashCall, Inc. v. Superior Court (2008)
At the hearing on the motion Pirjada’s counsel stated he intended to move to compel responses to the previously served discovery requests that sought contact information for members of the proposed class. Counsel for Pacific
On June 9, 2011 Pirjada’s counsel moved for an order compelling responses to requests Nos. 27 and 29 in the first set of requests for production of documents (security guard contact information), with a hearing date of July 21, 2011.
Pacific National opposed the motion to compel, principally arguing (1) Pirjada had settled all his claims before the responses to discovery were due; therefore, it had no duty to respond to the discovery requests. (2) Pirjada’s counsel had no right and no standing to seek to compel responses because the discovery had been served by Pirjada. (3) The motion was, in effect, an impermissible motion for reconsideration of the earlier, unsuccessful motion to compel notice to potential class members.
The court first noted the parties had essentially reargued the motions considered on May 21, 2011, although Piijada’s counsel now asked for the class identifying information to be provided directly to him, rather than to a third party administrator. The court then denied the motion, concluding, because Pirjada had settled his claims, “his 3/11/11 discovery is moot.” The court also stated it would not reconsider its earlier, May 2011 ruling, explaining, “By noting in the ruling that Plaintiffs counsel is free to communicate with Defendant’s employees, the Court did not mean to suggest that counsel is entitled to engage in discovery. The court simply meant that
On August 1, 2011 Westrup Klick, purportedly acting on behalf of Pirjada,
DISCUSSION
1. Governing Law
“California courts recognize and preserve the rights of absent class members, even before the issue of certification has been determined.” (Shapell Industries, Inc. v. Superior Court (2005)
a. Precertification communications and court-ordered discovery to identify potential class members
In Parris, supra,
Several years after Parris the Supreme Court confirmed that “[contact information regarding the identity of potential class members is generally discoverable, so that the lead plaintiff may learn the names of other persons who might assist in prosecuting the case.” (Pioneer Electronics (USA), Inc. v. Superior Court (2007)
Even a lead plaintiff who for some reason is unqualified to serve as a class representative “may, in a proper case, move for precertification discovery for the purpose of identifying a new class representative.” (Safeco Ins. Co. of
b. Court approval, an opportunity to amend and notice to potential class members before dismissal of a headless class action
In La Sala, supra, 5 Cal.3d 864 the named plaintiffs filed a putative class action lawsuit against American Savings & Loan Association alleging a provision in its form trust deed permitting it to accelerate a loan if the borrower executed a junior encumbrance on the secured property constituted an invalid restraint upon alienation. The lender offered to waive enforcement of that provision for the named plaintiffs. The trial court ruled the named plaintiffs no longer represented the class as a result of this waiver and dismissed the action. (Id. at p. 868.) The Supreme Court reversed, holding, “Although the named plaintiffs are not members of the class that they purport to represent as the complaint now stands, this fact cannot justify a dismissal of the action without affording plaintiffs an opportunity to amend their pleading.” (Ibid.) The court explained permissible amendments could either “redefine the class or . . . add additional representatives.” (Id. at p. 874.) The La Sala court also held, “[Wjhenever the dismissal of a class action stems from a defendant’s grant of benefits to the representative plaintiffs, which are not provided to the class as a whole, the court may not dismiss the action without notice to the class . . . .” (Id. at p. 868; see also id. at p. 874 [“if the amendment fails to establish a suitable representative, the court should not dismiss the action on this ground without undertaking such measures as it may direct to notify the members of the class”].)
In Kagan, supra,
Rule 3.770 addresses La Sola's and Kagan's concern for the protection of absent class members when the named representative’s claims have been resolved, either voluntarily, as here, or by unilateral action of the defendant. The rule requires court approval for requests to dismiss any party or cause of action, as well as to dismiss an entire class action. (Rule 3.770(a).) “Requests for dismissal must be accompanied by a declaration setting forth the facts on which the party relies. The declaration must clearly state whether consideration, direct or indirect, is being given for the dismissal and must describe the consideration in detail.” (Ibid.) In addition, if a class has not yet been certified and notice of the pendency of the action has not previously been provided to absent class members, notice of the proposed dismissal must be given “in the manner and to those class members specified by the court,” unless the court finds that dismissal without notice will not prejudice the absent class members. (Rule 3.770(c).)
2. Standard of Review
A discovery order is normally reviewed under the deferential abuse of discretion standard. (John B. v. Superior Court (2006)
3. The Superior Court Did Not Abuse Its Discretion in Denying the Motion to Compel Discovery Responses
Westrup Klick/Pirjada advances two distinct arguments in support of the petition for a writ of mandate directing the superior court to grant the motion to compel disclosure of potential class members’ names and contact information. First, as a matter of discovery law, because Pacific National failed to respond to Piijada’s document requests, it waived any objection to those requests under Code of Civil Procedure section 2031.300. Absent a finding that Pacific National’s failure was the result of mistake, inadvertence or excusable neglect, Westrup Klick/Pirjada contends, it was an abuse of discretion to deny the motion to compel. Second, as a matter of the procedural law governing class actions, described above, the court abused its discretion in declining to authorize notice to potential class members that Pirjada, the lead plaintiff, now lacks standing to represent the class because of his individual settlement with Pacific National and that a replacement class representative needs to be substituted. The first contention is incorrect; the second premature.
a. The discovery argument
Outside the context of representative and class actions it may well be, as Pacific National observes, “a matter of common knowledge and common sense” that once a plaintiff settles his or her case any discovery responses not yet due no longer need to be served. Because the lawsuit against Pacific National was filed as a class action, however, and the individual settlement with Pirjada was made without the participation or consent of his lawyer, the experienced employment law attorneys representing Pacific National should have either objected to the still-outstanding discovery as moot, moved for a protective order or taken steps to ensure that the settlement agreement between their client and Pirjada included a provision withdrawing any remaining discovery requests.
As Pacific National’s counsel surely knew, Pirjada’s agreement to request his lawyer dismiss the case with prejudice was not self-executing and,
Nonetheless, the decision to deny the motion to compel was also within the broad discretion of the court: By the time the motion was filed, the court had already chosen other means to protect the absent class members—it gave Westrup Klick leave to amend the complaint after using informal means to identify potential replacement class representatives and deferred any determination whether the entire case should be dismissed and, if so, how to comply with the notice requirements of Rule 3.770(c), to a later date. Although the court’s decision to deny Westrup Klick’s motion for notice to the class was based largely on a distinction between consumer and employee class actions, a distinction we implicitly rejected in Belaire-West Landscape, Inc. v. Superior Court, supra,
b. The class action procedure argument
Westrup Klick/Pirjada’s second argument is, in essence, that the superior court is required under La Sala and Rule 3.770(c) to provide notice to absent class members before dismissing the action. Therefore, it was an abuse of discretion not to facilitate that notice by directing Pacific National to provide the names and contact information of its former and current employees that will be needed. This contention improperly conflates distinct aspects of class action procedure.
As we have discussed, precertification discovery may be allowed in appropriate circumstances to identify a substitute class representative in place of one who is not able to serve in that capacity, as well as to assist the lead plaintiff in learning the names of other individuals who might assist in prosecuting the action. But the obligation to notify absent class members before dismissing the case rests with the superior court, not the lead plaintiff or class counsel. The nature and extent of that notice must be decided by the court itself. (See La Sala, supra,
Whether or not the superior court’s initial decision not to notify potential class members that Pirjada now lacks standing to represent the class was correct, the court will necessarily revisit that question when it hears its order to show cause regarding dismissal. Counsel’s declaration in support of the petition for writ of mandate indicates a new class representative cannot be identified by the informal means authorized in Parris, supra,
The petition for writ of mandate is denied. The stay of proceedings in respondent court previously imposed is vacated. The parties are to bear their own costs in this writ proceeding.
Zelon, J., and Jackson, J., concurred.
Notes
At the May 26, 2011 hearing on the motions to compel class notice and to dismiss, the court had advised counsel motions were then being set for hearing in mid-July.
The court denied both parties’ requests for sanctions.
Pirjada is identified throughout the filing as the petitioner; paragraph 2 of the petition itself avers “Petitioner OBAIDUL H. PIRJADA (‘Plaintiff’) is the plaintiff in an action now pending in respondent superior court entitled Pirjada v. Pacific National Security, Inc., LASC No. BC317955 (the ‘Action’).” In its unverified return to the order to show cause, Pacific National denied this allegation, asserting, “[FJormer Plaintiff Obaidul Pirjada is not the petitioner here. Rather, his former counsel is, since Pirjada settled his claims in good faith with Defendant and real party in interest, Pacific.” (But see Cal. Rules of Court, rule 8.487(b)(1) [authorizing return to order to show cause “by demurrer, verified answer, or both”]; Shaffer v. Superior Court (1995)
We noted, when engaging in precertification communications, a member of the State Bar of California must comply with the requirements of the State Bar Rules of Professional Conduct and abide by its prohibitions on false, misleading and deceptive messages or face possible disciplinary action. (Parris, supra,