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“Death Knell” Doctrine Applies to PAGA Representative Actions.

Miranda v. Anderson Enterprises, Inc. (October 15, 2015) 241 Cal.App.4th 196

As a condition of his employment, Plaintiff signed an arbitration agreement with a class and collective action waiver. Plaintiff brought a wage and hour class action, including a claim under the Labor Code Private Attorneys General Act of 2004 (PAGA). The trial court, ruling before the California Supreme Court decided Iskanian v. CLS Transp. Los Angeles, LLC (2014) 59 Cal.4th 348, granted Defendant’s petition to dismiss Plaintiff’s class and representative claims and compel his individual claims to arbitration. Iskanian, of course, held that PAGA claims could not be compelled to arbitration. In Miranda, the court of appeal held that the “death knell” doctrine, which provides an exception to the one final judgment rule where a court orders a plaintiff to dismiss class claims and pursue individual claims only, applies to PAGA representative actions, as well. In so doing, the appellate court was able to rule on the arbitration order, which generally is not appealable.[i]

The court of appeal relied on the analysis in Muñoz v. Chipotle Mexican Grill, Inc., (2015) 238 Cal.App.4th 29 to bolster its conclusion that substantively there is no difference in applying the rationale of the death knell doctrine – that without the prospect of a significant recovery, there is little incentive to see an individual action through to the end and then appeal denial of a court order – to PAGA representative actions.

[i] Nelson v. Legacy Partners Residential, Inc. (2012) 207 Cal.App.4th 1115, 1121; but see Aleman v. Airtouch Cellular (2012) 209 Cal.App.4th 556, 585; and Franco v. Athens Disposal Co., Inc. (2009) 171 Cal.App.4th 1277, 1288.