Last week, the California Supreme Court issued a decision in the matter of Williams v. Marshalls of CA, LLC (SC227228 7/13/17) which clarifies the scope of discovery permissible in PAGA actions.  Williams is a statewide representative action seeking penalties for alleged meal and rest break violations.  During the scope of discovery, plaintiff sought contact information for fellow California employees.  When the defendant employer, Marshalls of CA, LLC objected, a motion to compel ensued.  The trial court granted the motion as to the particular store where plaintiff worked, but denied it as to all other stores in California.  The trial court conditioned any further production of contact information on a showing of merit to the underlying action.  The Supreme Court reversed, and made significant holdings concerning the scope of discovery available in PAGA actions.  Although the case deals specifically with production of contact information of individuals a plaintiff seeks to represent in a representative action, the holdings are relevant to PAGA discovery generally.  Here are the key points:

The Scope of Discovery is Broad and to be Construed Liberally, Including in PAGA Actions

The Supreme Court reaffirmed that the scope of discovery is broad, and that nothing in the characteristics of a PAGA action serves as a basis for restricting discovery.  Thus, the decisions of the Supreme Court and the Courts of Appeal which establish what is discoverable in non-PAGA class actions are equally applicable in the PAGA context.

In reaching this conclusion, the Supreme Court specifically rejected the view that PAGA requires an aggrieved employee seeking to pursue civil penalties on behalf of other current or former employees to have some modicum of substantial proof before proceeding with discovery.  Instead, the Court confirmed that the general principle of Code of Civil Procedure section 2017.010 is that discovery is itself the means by which proof of allegations is developed.  

The Court held that the Code of Civil Procedure does not authorize a trial court to interpose a proof of the merits requirement before ordering responses to interrogatories in the absence of any evidence of the burden responding would entail.  The Court further held that trial courts lack discretion to augment the limitations on discovery established by the Legislature.

Additionally, the Court specifically rejected the argument that either PAGA’s notice requirement (affording the Labor and Workforce Development Agency the opportunity to decide whether to allocate scare resources to an investigation and the employer the opportunity to respond to the Agency) translates into a requirement that an employee’s allegations must already be backed by “some particular quantum of admissible proof.”  Inserting such a requirement into PAGA would undercut the legislative purpose of PAGA by requiring “deputized aggrieved employees to satisfy a PAGA-specific heightened proof standard at the threshold, before discovery.”

Despite the Procedural Differences Between Class and PAGA Actions, the Discovery Rights Recognized in Class Actions Are Equally Applicable to PAGA Actions

The Supreme Court rejected Marshall’s argument that the nature of a PAGA action, which is distinguishable from an action brought pursuant to a formalized class action, should differentiate the discovery rights recognized in wage and hour class actions from PAGA actions.  Instead, the Court held that nothing in Pioneer Electronics (USA), Inc. v. Superior Court (2007) 40 Cal.4th 360 or its progeny depends on the features of a class action to justify the discovery permitted.  The Court emphasized the similarities between a class action and a PAGA action to demonstrate why production of contact information should be permitted in both: in both types of cases fellow class members and fellow aggrieved employees are potential percipient witnesses, in both types of cases absent class members and absent aggrieved employees are bound by the outcome of their respective actions, and in both types of cases overlapping policy considerations are aligned.

Thus, as with putative class actions, “[t]hat the eventual proper scope of a putative representative action is as yet uncertain is no obstacle to discovery; a party may proceed with interrogatories and other discovery methods precisely in order to ascertain that scope.”

As in Class Actions, the Identity of Other California Employees Is Clearly Within the Scope of Permitted Discovery in PAGA Actions

Based on these principles, the Supreme Court—consistent with its prior decision in Pioneer and numerous Courts of Appeal decisions in the class action context—found that an interrogatory seeking to identify Marshall’s other California employees, inferentially as a first step to identifying other aggrieved employees and obtaining admissible evidence of the violations and policies alleged in the complaint, is permissible in the PAGA context.  Thus, the Court held that, “…in a particular case there may be a special reason to limit or postpone a representative plaintiff’s access to contact information for those he or she seeks to represent, but the default position is that such information is within the proper scope of discovery, an essential first step to prosecution of any representative action.” 

As in Class Actions, Privacy Concerns Are Adequately Protected By the Standards Set Forth in Hill and Belaire-West

The Supreme Court additionally rejected the view that production of statewide employee contact information should be restricted in order to protect the employees’ privacy interests.  The Court held that the well-established procedures widely used in class actions under Hill v. National Collegiate Athletic Assn. (1994) 7 Cal.4th 1, 35-40 and Belaire-West Landscape, Inc. v. Superior Court (2007) 149 Cal.App.4th 554 are adequate to protect the Constitutionally protected rights of privacy of Californians.