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Miranda v. O'Reilly Automotive Stores, Inc.

United States District Court, D. Nevada

August 26, 2014

ANGELICA MIRANDA, Plaintiff,
v.
O'REILLY AUTOMOTIVE STORES, INC. et al., Defendants.

ORDER

ROBERT C. JONES, District Judge.

This case arises out of an employer's alleged failure to pay its employees overtime. Pending before the Court is Defendants' Motion to Dismiss (ECF No. 7) the third through fifth claims. For the reasons given herein, the Court denies the motion without prejudice and stays the case.

I. FACTS AND PROCEDURAL HISTORY

Plaintiff Angelica Miranda worked for Defendant O'Reilly Automotive Stores, Inc. ("O'Reilly") in Las Vegas, Nevada as a store manager from January 2013 until April 15, 2014. (Compl. ¶¶ 4, 12-14, ECF No. 1). Miranda and others similarly situated were required to work at least five ten-hour shifts per week and were not paid hourly wages or overtime, despite earning less than $455 per week. ( Id. ). Plaintiff has brought the present Rule 23 class action, accusing O'Reilly, O'Reilly Auto Enterprises, LLC, and CSK Auto, Inc. of violations of the following federal and state statutes: (1) 29 U.S.C. § 201; (2) 29 U.S.C. § 207; (3) NRS section 608.016; (4) NRS section 608.018; and (5) NRS section 608.020-.050. Defendants have moved to dismiss the third, fourth, and fifth claims for failure to state a claim.

II. LEGAL STANDARDS

Federal Rule of Civil Procedure 8(a)(2) requires only "a short and plain statement of the claim showing that the pleader is entitled to relief" in order to "give the defendant fair notice of what the... claim is and the grounds upon which it rests." Conley v. Gibson , 355 U.S. 41, 47 (1957). Federal Rule of Civil Procedure 12(b)(6) mandates that a court dismiss a cause of action that fails to state a claim upon which relief can be granted. A motion to dismiss under Rule 12(b)(6) tests the complaint's sufficiency. See N. Star Int'l v. Ariz. Corp. Comm'n, 720 F.2d 578, 581 (9th Cir. 1983). When considering a motion to dismiss under Rule 12(b)(6) for failure to state a claim, dismissal is appropriate only when the complaint does not give the defendant fair notice of a legally cognizable claim and the grounds on which it rests. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). In considering whether the complaint is sufficient to state a claim, the court will take all material allegations as true and construe them in the light most favorable to the plaintiff. See NL Indus., Inc. v. Kaplan , 792 F.2d 896, 898 (9th Cir. 1986). The court, however, is not required to accept as true allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences. See Sprewell v. Golden State Warriors , 266 F.3d 979, 988 (9th Cir. 2001). A formulaic recitation of a cause of action with conclusory allegations is not sufficient; a plaintiff must plead facts pertaining to his own case making a violation plausible, not just possible. Ashcroft v. Iqbal, 556 U.S. 662, 677-79 (2009) (citing Twombly , 550 U.S. at 556) ("A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged."). In other words, under the modern interpretation of Rule 8(a), a plaintiff must not only specify or imply a cognizable legal theory ( Conley review), but also must plead the facts of his own case so that the court can determine whether the plaintiff has any plausible basis for relief under the legal theory he has specified or implied, assuming the facts are as he alleges ( Twombly-Iqbal review).

"Generally, a district court may not consider any material beyond the pleadings in ruling on a Rule 12(b)(6) motion. However, material which is properly submitted as part of the complaint may be considered on a motion to dismiss." Hal Roach Studios, Inc. v. Richard Feiner & Co. , 896 F.2d 1542, 1555 n.19 (9th Cir. 1990) (citation omitted). Similarly, "documents whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the pleading, may be considered in ruling on a Rule 12(b)(6) motion to dismiss" without converting the motion to dismiss into a motion for summary judgment. Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir. 1994). Moreover, under Federal Rule of Evidence 201, a court may take judicial notice of "matters of public record." Mack v. S. Bay Beer Distribs., Inc., 798 F.2d 1279, 1282 (9th Cir. 1986). Otherwise, if the district court considers materials outside of the pleadings, the motion to dismiss is converted into a motion for summary judgment. See Arpin v. Santa Clara Valley Transp. Agency, 261 F.3d 912, 925 (9th Cir. 2001).

III. ANALYSIS

The Court has previously ruled that there is no private right of action under NRS sections 608.100 or 608.018. The Court will reiterate its reasoning here. The Nevada Supreme Court has explicitly ruled there is no private right of action to enforce section 608.100. See Baldanado v. Wynn Las Vegas, LLC, 194 P.3d 96, 100-05 (Nev. 2008) (finding no private right of action under section 608.100 and two other sections of Chapter 608); see also Lucas v. Bell Trans, No. 2:08cv-01792, 2009 WL 2424557 at *2-5 (D. Nev. June 24, 2009) (Jones, J.) (citing id. ). Another court of this District has ruled that there is a private right of action for violations of section 608.018 pursuant to section 608.140. See Buenaventura v. Champion Drywall, Inc., 803 F.Supp.2d 1215, 1218-19 (D. Nev. 2011). Although the Nevada Supreme Court has not directly addressed the question, the Buenaventura court reasoned that because section 608.018 governs payment of overtime wages, and because there is a private right of action to recover unpaid wages under section 608.140, an employee may sue to recover wages owed under the standards of section 608.018 via a section 608.140 action. See id. at 1218.

The Court disagrees, however, and rules that section 608.140 does not imply a private right of action to sue under the labor code, but only to sue in contract. Section 608.140 clearly presumes the availability of some kind of private right of action to recover wages, because it governs attorney's fees and costs in such actions. See Nev. Rev. Stat. § 608.140 ("Whenever a mechanic, artisan, miner, laborer, servant or employee shall have cause to bring suit for wages earned and due according to the terms of his or her employment...."). However, section 608.140 only implies a private right of action to recover wages " earned and due according to the terms of his or her employment, " and therefore appears to govern fees and costs only in common law contractual suits. Id. (emphasis added). The statute does not imply a private remedy to enforce the labor statutes, which impose external standards for wages and hours. The Baldanado Court was emphatic that "the absence of an express provision providing for a private cause of action to enforce a statutory right strongly suggests that the Legislature did not intend to create a privately enforceable judicial remedy." Baldanado, 194 P.3d at 101. In ruling that there was no private right of action under sections 608.100, 608.160, and 613.120, the Baldanado Court indicated that the Labor Commissioner's authority covered sections 608.005 to 608.195 and that "when an administrative official is expressly charged with enforcing a section of laws, a private cause of action generally cannot be implied." Id. at 102. In light of Baldanado 's broad language and warning against lightly implying private causes of action, the Court believes that sections 608.016, 608.018, and 608.020-.050 are within the Labor Commissioner's exclusive jurisdiction, just as section 608.100 is. The statutes provide a comprehensive remedial scheme whereby review of the Commissioner's decisions is available in the courts. See Nev. Rev. Stat. § 607.215.

That remedial scheme is not, as Plaintiff argues, "nonsensical" because it prevents class actions. It may be frustrating to labor law attorneys that there is no private right of action directly in the courts permitting them to take advantage of the lucrative Rule 23 procedure in cases where the remedy must go through the Commissioner on a case-by-case basis, but that does not render the remedial system adopted by the Nevada State Legislature "nonsensical." Nevada's general policy favoring class actions does not trump a comprehensive remedial scheme particularly chosen by the Legislature. Nor is the result "absurd" because Plaintiff also wishes to bring claims under the Fair Labor Standards Act ("FLSA"), which claims may of course be brought in court. Plaintiff may press her state law claims with the Commissioner while pressing her FLSA claims here.

Footnote 33 of Baldanado notes, "a private cause of action to recover unpaid wages is entirely consistent with the express authority under NRS 608.140 to bring private actions for wages unpaid and due." See 194 P.3d at 104 n.33. But the Baldanado Court did not directly address the question of whether section 608.140 authorized a private suit or, more importantly, what kinds of suits it implied. Rather, it made the comment in footnote 33 to contrast those sections of the labor code under which there was no language possibly implying any kind of private right of action at all.

Section 608.140 implies only a cause of action to recover wages unpaid and due "according to the terms of his or her employment, " which strongly implies a contractual remedy, not a remedy to enforce the labor laws. The phrase "according to the terms of... employment" means "according to the contractual terms of... employment, " as opposed to something like "according to the laws concerning... employment." This result depends on whether "terms" under section 608.140 more reasonably means "contractual terms, " "regulatory standards, " or both. The Court finds that it means something more like "contractual terms." A contemporary dictionary defines the word "term" (along with irrelevant definitions) as "[c]ondition; arrangement." Webster's New Standard Dictionary of the English Language 379 (Laird & Lee, 1920). Another, more comprehensive, contemporary dictionary defines "term" (along with irrelevant definitions) as "[o]bligations imposed by authority or assumed by contract; conditions offered, or offered and accepted; as, the terms of sale; I cannot accept your terms. " Funk & Wagnalls New Standard Dictionary of the English Language 2486 (1913). In the broadest sense, "condition" could refer to statutory restrictions, as in "it is a condition of your freedom that you not burglarize another's home, " but this would be an awkward usage. Such an improbable interpretation should not be made where surrounding text in the definition does not require it. Next, "imposed by authority" indicates that "terms" can apply to not only purely private relationships but also to relationships with the government. But the phrase does not refer to any and all relationships of authority. These parts of the definitions invoke situations such as criminal probation, civil licenses, and other authoritative contexts concerning particularized relationships between an authority and an individual, as opposed to general regulatory commands. One speaks of "terms of probation" or "terms of a license, " but one does not speak of statutory prohibitions or commands inversely as "terms of lawful behavior, " which usage, again, although grammatically possible, would be odd. So although "terms" may refer to arrangements between a government and a citizen, it fairly does so only in contexts where those two parties have a particularized relationship, not in the general sense that a citizen is subject to the terms of a statute. Furthermore, the statute speaks of "terms of... employment, " not "terms of the law, " indicating that the statute means terms "assumed by contract, " not those "imposed by authority." See id. The word "arrangement" used in Webster's and the contractual examples given in Funk & Wagnalls clarify the meaning of "terms" when the respective definitions are considered as a whole. Employers and employees do not arrange the labor statutes; they arrange their contractual relationships. In summary, the word "terms" indicates negotiated terms, as per a contract, not externally imposed standards, as per a statute.

The respective dates of passage of sections 608.140 and 608.018 also support this conclusion. Section 608.140 (implying a right of action to recover unpaid wages) predates section 608.018 (overtime standards) by half a century. Section 608.140 was adopted in 1925. See 1925 Nev. Stat. 226-27. That pre-New Deal statute not only predates Nevada's overtime laws by fifty years, see 1975 Nev. Stat. 1583, it also predates federal wage and overtime laws by over a decade, see Fair Labor Standards Act of 1938, Pub. L. No. 75-718, 52 Stat. 1060 (1938). Section 608.140 cannot have meant to the People of Nevada in1925 that there was a private right of action under state wage and overtime laws not to be enacted until 1975. Taking into consideration the "according to ...


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