Duran v U.S. Bank Nat. Assn. 2/6/12 CA1/1

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State: California

Court: 1st District Court of Appeal 1st District Court of Appeal

Docket No: A125557

Case Date: 05/16/2012

Preview:Filed 2/6/12

CERTIFIED FOR PUBLICATION IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA FIRST APPELLATE DISTRICT DIVISION ONE

SAM DURAN et al, Plaintiffs and Respondents, v. U.S. BANK NATIONAL ASSOCIATION, Defendant and Appellant. (Alameda County Super. Ct. No. 2001-035537) A125557 & A126827

Following a bifurcated bench trial, defendant U.S. Bank National Association (USB) has appealed the resulting $15 million judgment in this wage and hour class action brought under Business and Professions Code section 17200 (section 17200). The plaintiffs in the class action are 260 current and former business banking officers (BBO`s) who claimed they were misclassified by USB as outside sales personnel exempt from California`s overtime laws, and were thus unlawfully denied overtime pay. In addition to arguing the case should not have been certified as a class action, USB contends the trial court`s trial management plan deprived it of its constitutional due process rights in that the plan prevented it from defending against the individual claims for over 90 percent of the class. We agree the trial management plan was fatally flawed and reverse the judgment. We also conclude the case must be decertified, and reverse an order awarding certain expert witness fees to plaintiffs.1 We remand the two named plaintiffs` meal and rest break period violation claims for reconsideration in light of the
1

The two consolidated appeals are from the judgment after court trial (A125557) and from an award of expert witness fees with respect to plaintiffs` expert witness Miles Locker (A126827).

California Supreme Court`s ruling in Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25, review granted October 22, 2008 (S166350).2 FACTUAL BACKGROUND In January 2005, when plaintiffs moved to certify this case as a class action, USB reportedly operated over 130 traditional bank branches in California with approximately 40 persons then currently employed as BBO`s. Each BBO was typically assigned to work with one to four bank branches. BBO`s report to sales managers who in turn report to regional managers. Regional managers report to a division manager who then reports to the executive vice president. USB applies a uniform wage exemption to BBO`s, categorizing them as exempt outside salespersons to whom USB is not obligated to pay overtime and related wages.3 The outside salesperson exemption is set forth in Labor Code section 1171, which states: The provisions of this chapter [including Labor Code section 1194][4] shall apply to and include men, women and minors employed in any occupation, trade, or industry, whether compensation is measured by time, piece, or otherwise, but shall not include any individual employed as an outside salesman . . . . California Industrial Wage Commission Wage Order No. 4-2001 (Wage Order No. 4) (codified at Cal. Code Regs., tit. 8,

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