United States District Court, D. Nebraska
EZEQUIEL OLIVARES ABARCA, ALFREDO ALESNA JR., DAVID CAGLE, STEPHEN L. DAVIS, FRANK EADS, and KENNETH J. SURMAN, individually and on behalf of all those similarly situated, Plaintiffs,
WERNER ENTERPRISES, INC., DRIVERS MANAGEMENT, LLC, and DOES 1-100, inclusive, Defendants. WILLIAM SMITH, on behalf of himself and all others similarly situated, and on behalf of the general public, Plaintiff,
WERNER ENTERPRISES, INC., d/b/a C.L. WERNER, INC., a corporation, and DOES 1-100, inclusive, Defendants.
FINDINGS AND RECOMMENDATION AND ORDER
MICHAEL D. NELSON UNITED STATES MAGISTRATE JUDGE.
matter is before the Court on Plaintiffs' Renewed Motion
for Class Certification (Filing No. 166 in Case No.
8:14cv319; Filing No. 71 in Case No. 8:15cv287), and
Defendants' Motion to Strike Plaintiffs' Exhibits
Offered in Support of Plaintiffs' Renewed Motion for
Class Certification (Filing No. 175 in Case No.
8:14cv319; Filing No. 80 in Case No.
detailed by prior court orders, these putative class actions
arise out of Plaintiffs' allegations that Werner
Enterprises, Inc. (“Werner”) and its wholly owned
subsidiary, Drivers Management, LLC (“Drivers
Management”) have uniform policies and practices that
violate various wage and hour laws of California and
Nebraska. (Filing No. 119; Filing No. 150).
Plaintiffs' allege that Defendants have a
uniform policy and practice . . . of not paying all wages
owed, not paying for all time worked, including compensable
rest periods and compensable on-duty non-driving time, not
paying premium hours for missed meal/rest periods (for the
California Class), making improper deductions from pay for
work performed, not providing properly itemized pay
statements that accurately reflect hours worked, applicable
hourly rates and (for the California Class) premium hours for
missed meal/rest periods, and . . . not maintaining records
that accurately reflect hours worked and applicable hourly
(Filing No. 160 at p. 6).
4, 2014, Antonia Russell (“Russell”) filed a
putative class action against Werner in California state
court for violations of California wage and hour laws.
(Filing No. 1-1). On August 25, 2014, Werner removed
the case to the Northern District of California. (Filing
No. 1). On October 6, 2014, the case was transferred to
this district under 28 U.S.C. § 1404(a).
(Filing No. 23). On March 30, 2015, an amended complaint
was filed by Russell, Ezequiel Olivares Abarca
(“Abarca”), Alfredo Alesna Jr.
(“Alesna”), David Cagle (“Cagle”),
Stephen L. Davis (“Davis”), Frank Eads
(“Eads”) and Kenneth J. Surman
(“Surman”) against Werner and Drivers Management.
(Filing No. 52). By joint stipulation of the
parties, Russell was dismissed as a party on April 24, 2015,
(Filing No. 55), and on September 17, 2015,
Plaintiffs filed a third amended complaint adding claims
under Nebraska wage and hour laws. (Filing No. 80).
12, 2015, William Smith (“Smith”) filed a
putative class action against Werner in California state
court for violations of California wage and hour laws.
(Filing No. 1-1 in Case No. 8:15cv287). On June 26,
2015, Werner removed the case to the Northern District of
California. (Filing No. 1 in Case No. 8:15cv287). On
July 31, 2015, the case was transferred to this district
under 28 U.S.C. § 1404(a). (Filing No. 17 in
Case No. 8:15cv287).
November 19, 2015, the above captioned cases were
consolidated for all purposes, including trial, (Filing
No. 119), and Case No. 8:14cv319 was deemed the Lead
Case. (Filing No. 131).
court set March 1, 2016, as the deadline to complete
discovery limited to class certification and April 1, 2016,
as the deadline for Plaintiffs to file a motion to certify a
class. (Filing No. 125). On April 1, 2016,
Plaintiffs filed a motion to certify two classes: a Nebraska
Class and a California Class. (Filing No. 135). The
operative pleading at that time was Plaintiffs' third
amended complaint, which defined the California Class as
“all truck drivers who worked or work in California for
Werner after the completion of training at any time since
four years before the filing of this legal action until such
time as there is a final disposition of this
lawsuit[.]” (Filing No. 80 at p. 4).
October 28, 2016, Senior District Judge Lyle E. Strom entered
a Memorandum and Order denying Plaintiffs' motion for
class certification. (Filing No. 150). Judge Strom
found that the proposed “California Class” was
“not adequately defined and/or clearly ascertainable,
” and therefore Plaintiffs failed to establish
numerosity, commonality, typicality, and adequacy of the
proposed California Class, as required under Rule 23(a) of
the Federal Rules of Civil Procedure. (Filing No. 150 at
pp. 7-14). Judge Strom abstained from addressing
Plaintiffs' motion to certify the “Nebraska Class,
” and granted Plaintiffs leave to file a fourth amended
complaint to “attempt to provide the Court with an
adequately defined and clearly ascertainable definition for
the California Class.” (Filing No. 150 at p.
15). Judge Strom prohibited Plaintiffs from
substantively altering the complaint in any other way
“including, but not limited to, adding additional
claims, parties, classes, and/or causes of action.”
November 9, 2016, Plaintiffs filed a fourth amended
complaint. (Filing No. 151). On December 29, 2016,
Judge Strom sustained Defendants' motion to strike
portions of Plaintiffs' fourth amended complaint,
including an attached exhibit, as it contained new
allegations not limited to redefining Plaintiffs'
proposed California Class, in violation of the court's
previous order. (Filing No. 159).
re-filed their fourth amended complaint on January 6, 2017.
(Filing No. 160). Plaintiffs' fourth amended
complaint purports to bring claims individually and “on
behalf of similarly situated current and former truck drivers
whom Werner employed to work in California after the
completion of training, ” and defines the California
all truck drivers who, while working for Werner, picked up
and/or dropped off a load in the state of California after
the completion of training at any time since four years
before the filing of this legal action until such time as
there is a final disposition of this lawsuit[.]
(Filing No. 160 at p. 4).
respect to the Nebraska Class, Plaintiffs purport to bring
claims individually and “on behalf of similarly
situated current and former truck drivers whom Werner
employed to work anywhere after the completion of
training.” Plaintiffs allege violations of Nebraska
law, which “Werner has expressly agreed would apply to
truck driver employment” and define the Nebraska Class
as follows: “all truck drivers who worked or work
anywhere for Werner after the completion of training at any
time since four years before the filing of this legal action
until such time as there is a final disposition of this
lawsuit[.]” (Filing No. 160 at p. 4).
California Class plaintiffs allege Defendants' policies
violate the California Labor Code, California Industrial
Commission Wage Orders, and the California Unfair Competition
Law by: (1) failing to provide duty free meal/rest periods
(Claim One); (2) failing to pay for off-the-clock work (Claim
Two); (3) making improper deductions from paychecks for
income earned (Claim Three); (4) failing to provide itemized
pay statements as required under California law (Claim Four);
and (5) engaging in unlawful business acts and unfair
competition for the misconduct alleged in (1)-(4) (Claim
Five). (Filing No. 160 at pp. 9-16). Claim Six seeks
recovery under the Private Attorneys General Act of 2004
(“PAGA”) to the extent recovery for the preceding
claims is not obtained. (Filing No. 160 at p. 17).
Nebraska Class plaintiffs allege Defendants violated the
Nebraska Wage and Hour Act (“NWHA”) by paying less
than the minimum wage (Claim Seven) and the Nebraska Wage
Payment and Collection Act
(“NWPCA”) by failing to timely pay earned wages,
failing to provide accurate itemized pay statements, and
making improper wage deductions (Claim Eight). (Id.
at pp. 18-21).
California Class requests a declaratory judgment that: (1)
Defendants violated the California Labor Code, California
Welfare Commission wage orders, and California Unfair
Business Practices Act/Unfair Competition Law; (2) the time
during which the California Class members are on duty in
California constitutes compensable hours of employment for
purposes of the California Labor Code and California
Industrial Welfare Commission Wage Orders; (3) California
Class members are entitled to an award for the unpaid wages,
wages for absence of duty free meal/rest periods, recovery of
improper deductions from pay earned in California, waiting
time penalties, penalties for absence of properly itemized
wage statements/record maintenance, and any other applicable
statutory penalties; (4) Defendants must make restitution and
disgorgement of all ill-gotten gains; (5) equitable
distribution be made of unpaid residue of any recovery
pursuant to California Code of Civil Procedure §
384; (6) injunctive relief is appropriate to prohibit
future violations; and (7) penalties should be awarded under
PAGA. (Filing No. 160 at pp. 21-23).
Nebraska Class requests a declaratory judgment that: (1)
Defendants violated the NWHA and NWPCA, (2) the time during
which the Nebraska Class members are working anywhere
constitutes compensable hours of employment for purposes of
Nebraska law; (3) Nebraska Class members are entitled to an
award for the unpaid wages, recovery of improper deductions,
and any applicable statutory penalties; (4) and Defendants
must pay an additional amount to the State Treasurer pursuant
to Neb. Rev. Stat. § 48-1232. (Filing No.
160 at p. 23).
raise numerous affirmative defenses, including: (1)
Plaintiffs consented in writing that their employment with
Werner was Nebraska-based and subject to Nebraska law; (2)
Plaintiffs' claims are barred in whole or in part because
there is a conflict of laws prohibiting the extra-territorial
application of California law; Plaintiffs' claims are
barred by (3) ratification and the (4) statute of
limitations; (5) Plaintiffs' claims are preempted by the
Dormant Commerce Clause and the Federal Aviation
Administration Authorization Act; (6) Defendants acted in
good faith; (7) Plaintiffs consented in writing to alleged
paycheck deductions; (8) Plaintiffs failed to exhaust
administrative remedies; (9) Plaintiffs' claims are
unconstitutional; (10) Plaintiffs are equitably estopped by
the doctrines of waiver, estoppel, laches, and/or unclean
hands; (11) Plaintiffs' damages are de minimis; (12)
penalties under PAGA would be unjust, arbitrary, oppressive,
and confiscatory; (13) Plaintiffs' claims and civil
penalties awarded under PAGA, if any, must be limited to
those penalties applicable to an initial violation; (14)
Defendants substantially complied with all statutory
obligations; (15) Plaintiffs lack standing; (16)
Defendants' compensation practices are lawful; and (17)
no agreement existed for Defendants to pay the wages claimed
by Plaintiffs under the NWPCA. (Filing No. 161 at pp.
26, 2017, Plaintiffs filed the instant renewed motion to
certify a California Class and Nebraska Class. (Filing No.
166). Plaintiffs seek to certify the California and
Nebraska classes as defined by their fourth amended
complaint. Plaintiffs state in their brief that the proposed
California Class asserts claims “for work performed in
California” regardless of a driver's residency.
(Filing No. 167 at p. 2). Plaintiffs also
alternatively suggest that the Court certify a more narrowly
defined California Class “limited to Werner drivers who
were California residents.” (Filing No. 167 at p.
2). Plaintiffs further request that the Court appoint
the individually named Plaintiffs in Case No. 8:14cv319 as
the class representatives and to appoint class counsel.
support of their renewed motion, Plaintiffs filed the
Supplemental Declaration of Justin Swidler (Filing No.
168), and the Declaration of Jacqueline Thompson
(Filing No. 169) with six attached
exhibits. Defendants have filed a Motion to Strike
(Filing No. 175) Exhibit A (marked as Exhibit 1)
attached to Swidler's Declaration (Filing No. 168 at
pp. 5-25), and Exhibits 3, 4, and 5, attached to
Thompson's Declaration (Filing No. 169 at pp.
321-334). Exhibit A is a copy of an excerpt of pickup
and delivery records for Plaintiff Eads, which was produced
by Werner in discovery in a separate wage-and-hour class
action this court, Baouch v. Werner Enterprises,
Inc., Case No. 8:12cv408. Exhibit A is the same exhibit
that was stricken from Plaintiffs' stricken-fourth
amended complaint. (Filing No. 151; Filing No.
168 at pp. 5-25). Exhibits 3, 4, and 5 are pages printed
from websites. Exhibit 3 is a copy of Werner's online
advertisements regarding truck sales out of its Fontana
terminal from Werner's website, Exhibit 4 is a copy of
Werner's Zip Recruiter advertisement for California-based
drivers, and Exhibit 5 is a copy of an online advertisement
for on Indeed.com. (Filing No. 169 at p. 2).
opposition to the renewed motion to certify, Defendants filed
a brief (Filing No. 178) and Index of Evidence and
attached exhibits (Filing No. 179; Filing No.
179-1 through 179-6). Defendants also state they
incorporate their Index of Evidence and attached exhibits
(Filing No. 142) previously offered in opposition to
Plaintiffs' first motion to certify, as well as the
Declaration of Mary Kaye Howe (Filing No. 15-1)
previously filed in support of Defendants' motion to
is a Nebraska corporation headquartered in Omaha Nebraska,
engaged in the hauling and delivery of freight across the
United States. (Filing No. 179-5 at p. 2 -
Declaration of Jaime Maus ¶ 3). Werner's corporate
policies, payroll policies and records, drivers'
employment records, and all drivers' paychecks are
created, maintained, calculated, and distributed from
Werner's headquarters in Nebraska. (Filing No. 179-6
at p. 2 - Declaration of Steven Tisinger ¶¶
maintains terminals across the country, including one
terminal in Fontana, California. (Filing No. 142-5 at p.
3 - Jaime Maus Deposition 15:3-11). The Fontana terminal
is staffed with a terminal manager, an equipment manager, a
parts manager, and a lead safety specialist. It does not have
general managers, fleet managers, or dispatchers. (Filing
No. 179-5 at pp. 2-3 - Maus Decl. ¶¶ 5-6).
These managers manage safety personnel and do not manage
drivers, and no over-the-road drivers are assigned to the
Fontana terminal. (Id.). Drivers can attend
orientation at the Fontana terminal. (Filing No. 142-5 at
p. 3 - Maus Depo. 15:3-11). The Fontana terminal also
has a company store (Filing No. 169 at p. 112 -
WRN-RUSSELL00000022), a full service shop (Id. at p.
113 - WRN-RUSSELL00000023), and provides liaisons for student
drivers without trainers (Id. at p. 300 -
WRN-RUSSELL00000210) and student coordinators (Id.
at p. 107 - WRN-RUSSELL00000017). A copy of California Wage
Order 9-2001, which includes information about
California's meal and rest break requirements, is posted
in the vending machine room of the Fontana terminal.
(Filing No. 179-5 at pp. 2-3 - Maus Decl.
¶ 8). As of June 26, 2017, Werner represents it was
advertising for approximately thirty driver positions in
California. (Filing No. 179-6 at p. 4 - Maus Decl.
employs drivers who are residents of all fifty states, the
District of Columbia, and Canada. (Filing No. 15-1 at p.
3 - Declaration of Mary Kaye Howe ¶ 5). The named
Plaintiffs are all residents of California and are current or
former Werner drivers. (Filing No. 160 at p. 2;
Filing No. 1-1 in Case. No. 8:15cv287). Between June
4, 2010, and July 31, 2014, more than 14, 000 Werner truck
drivers drove and/or traveled miles in California, excluding
training miles. (Filing No. 15-1 at p. 2 - Howe
Decl. ¶ 4). Payroll taxes reflect that approximately 22%
of those 14, 000 drivers reside in California. (Id.
at ¶ 5). Between June 4, 2010, and July 31, 2014, Werner
drivers traveled a total of 1, 700, 000, 000 miles across the
United States and Canada, approximately 167, 000, 000 of
which were traveled in California (i.e., less than 10%).
(Id. at ¶ 4). This mileage was calculated using
Werner's mileage records maintained for the purpose of
complying with state fuel taxes, which are reported pursuant
to the International Fuel Tax Agreement (hereinafter,
“IFTA”). (Id.). According to Werner,
IFTA mileage is tracked using GPS, which pings based on the
nearest GPS location as opposed to the driver's actual
location, and is approximately 12% higher than the mileage
Werner uses to calculate driver pay. (Id.). Werner
uses a separate system to calculate individual drivers'
mileage, the Shortest Route Guide software published by Rand
McNally. (Filing No. 142-4 at p. 6 - Tisinger Depo.
20:9-21:22). Qualcomm units (now called Omnitracs) installed
on each truck track the truck's approximate position by
pinging a satellite approximately every 15 minutes.
(Filing No. 142-5 at p. 9 - Maus Depo. 56:10-57:24;
Filing No. 142-6 at pp. 3 - Mary Kaye Howe
Deposition 24:14-25:11, 31:14-32-9, 36:9-37:11).
drivers for Werner sign an “Acknowledgement of
Employment in Nebraska and Consent to State of Nebraska
Workers' Compensation” form, which provides that
the driver acknowledges that “regardless of where
he/she signs this application, all [Drivers Management]
decisions to hire employees and contracts for hire are made
only in Omaha, Neb., and an employee/employer relationship
between the driver and [Driver's Management] can be
entered into only in Omaha, Neb.” (Filing No.
142-15 - Plaintiffs' Acknowledgements of
Employment). The driver also acknowledges he or she
“will be a state of Nebraska-based employee, and all
employees of [Drivers Management] regardless of where
employees claim residence, are subject to Nebraska's
workers' compensation jurisdiction and laws and
Nebraska's labor and employment laws.” Id.
are paid for point to point mileage per assigned trip as
calculated using the Rand McNally software. (Filing No.
142-4 at p. 6 - Tisinger Depo. 20:9-21:22). According to
Werner, the mileage rate “takes into consideration
everything from origin to destination, ” including rest
breaks. (Id. at p. 45 - Tisinger Depo. 177:6-18).
Pay rates vary based on a driver's division or solo/team
status, driving experience, safety, on-time delivery
performance, among other factors. (Filing No. 142-14 at
p. 7 - WRN-RUSSELL00000075; Filing No. 179-3 -
WRN-RUSSELL00004209-04211, WRN-RUSSELL00007794; Filing
No. 179-4 - WRN-RUSSELL0000829,
WRN-RUSSELL00004469-04471). In addition to “piece
rate” mileage pay, Werner also may pay drivers
supplemental pay and/or discretionary pay for things such as
loading/unloading, layovers, lumpers, motels, miscellaneous
pay items, network optimization, shag pay, stop pay, safety
pay, among other things. (Filing No. 142-4 at pp.
33-35, 49 - Tisinger Depo. 126:3-1288:13, 132:10-133:25,
135:21-137:24, 189:25-190:5; Filing No. 142-14 at p.
5 -WRN-RUSSELL00000068-0069; Filing No. 142-16
- WRN-RUSSELL00001870; Filing No. 179-2 -
WRN-RUSSELL00000067, WRN-RUSSELL00000293-0294, WRN-
RUSSELL00035904). Discretionary pay is “computed in any
manner deemed appropriate by the driver's fleet
manager[.]” (Filing No. 179-6 at pp. 3-4 -
Tisinger Decl. ¶¶ 8-9).
taxes are withheld from drivers' paychecks based on their
state of residence. (See, e.g., Filing No. 142-14 at p.
1 - Abarca Statement of Earnings). Drivers' pay
statements include gross earnings, reimbursements,
deductions, trip details (including point of origin and
destination, stops, deadhead, rate of pay), and other notes.
(Filing 142-14 at p. 14 - WRN-RUSSELL00000302). Beginning on
January 9, 2013, drivers who attended orientation in
California, or who have California residences for payroll and
taxes purpose, or have a California CDL, additionally have
their “on-duty” hours listed on their pay
statements. Werner also “true[s] up” these
drivers' wages to California's minimum wage.
(Filing No. 142-4 at pp. 7-8, 26-27 - Tisinger Depo.
25:5-27:6, 101:15-102:10; Filing No. 179-6 at p. 5 -
Tisinger Decl. ¶ 12).
orientation, each driver is provided a copy of the Werner
Driver Handbook (“Handbook”). (Filing No.
142-5 at p. 4 - Maus Depo. 18:8-12). From June 2010,
through April 2016, Werner issued five different Handbooks,
as it was updated and reissued in 2008, June 2013, September
2014, April 2015, and June 2015. (Filing No. 142-2 at p.
2 - Declaration of Jaime Maus ¶ 5).
Handbook outlines the Federal Motor Carrier Hours of Service
(“HOS”) Duty Status Definitions. Line 1 items are
“Off Duty” and includes “rest breaks taken
outside of the sleeper berth including meal breaks.”
Line 2 is for time in the sleeper berth. Line 3 is for
“Driving” and includes all time operating at the
driving controls and time when the computer log detects
motion. Line 4 is for logging “On Duty-Not
Driving” time. This category includes all time
“[f]rom the time you begin to work or are required to
be ready to work until the time you are relieved from
work.” It includes pre-trip and other inspections,
physically loading and unloading the trailer, paperwork and
receipts at a customer, time spent providing a breath sample
or urine specimen, quarterly safety training, among others.
It does not include rest time in a parked vehicle or up to
two hours in the passenger seat of a moving vehicle
immediately before or after an 8-hour consecutive break in
the sleeper berth. (Filing No. 142-14 at p. 10 -
WRN-RUSSELL00000165). Drivers are responsible for logging
their own activities. (Filing No. 142-2 - Maus Decl.
Handbook outlines HOS regulations regarding breaks, including
the 11-Hour, 14Hour, and 70-Hour rules. (Filing No.
142-14 at p. 11 - WRN-RUSSELL00000166). The Handbook
notes that Werner “recommends drivers take at least a
30-minute break after driving four to six hours.”
(Id.). Werner trains drivers that they are
“the captain of their ship” and “to take
breaks when they see they need them, ” but drivers are
not specifically ...