Failure To Mention PAGA Fee Entitlement, Much Less Segregate Fees, Resulted In Overturn.
This next post is an ouch!
In Makabi v. Gedalia, Case No. B261005 (2d Dist., Div. 1 Mar. 2, 2016) (unpublished), plaintiff employees sued two defendant employers for a host of Labor Code wage/hour violations and four plaintiffs sued two individual defendants (who owned employers) for PAGA claims. In the end, the trial judge found in favor of the seven plaintiffs, by and large, but did not award PAGA civil penalties (but did find PAGA liability against the individual defendants). Plaintiffs sought fee recovery under Labor Code sections 226 and 1194 (itemization/wage-hour provisions), but not expressly under Labor Code section 2699 (PAGA fee-shifting provision). The lower court nevertheless awarded $456,522.20 against all defendants (including the individual defendants), jointly and severally, out of a requested $570,653.13 in fees.
The individual defendants appealed, and it was a good thing they did. They gained a reversal of the fees. The reason was they were not named in the Labor Code claims involving itemization and wage-hour claims, which would have led to fee recovery. Instead, they were only sued under the PAGA claim, and here is the kicker—plaintiffs never sought fee entitlement in the notice of motion and motion under the PAGA fee-shifting provision much less attempted to segregate fee recovery against individual defendants solely against the PAGA claim. That meant the fee recovery had to be deleted as to the individual defendants. Ouch, again.
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