NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS MAR 22 2018
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
MICHAEL CHAVEZ, No. 16-56067
Plaintiff-Appellant, D.C. No.
2:12-cv-05291-RGK-RZ
v.
TIME WARNER CABLE, LLC; TIME MEMORANDUM*
WARNER ENTERTAINMENT
COMPANY, LP; TIME WARNER CABLE
SHARED SERVICES; DOES, 1 to 100,
inclusive,
Defendants-Appellees.
Appeal from the United States District Court
for the Central District of California
R. Gary Klausner, District Judge, Presiding
Submitted March 7, 2018**
Pasadena, California
Before: GOULD and MURGUIA, Circuit Judges, and CHRISTENSEN,*** Chief
District Judge.
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
***
The Honorable Dana L. Christensen, Chief United States District
Judge for the District of Montana, sitting by designation.
Plaintiff-Appellant Michael Chavez appeals the district court’s grant of
summary judgment to Time Warner Cable, LLC, Time Warner Entertainment
Company, LP, and Time Warner Cable Shared Service (collectively “Defendants”)
in this dispute over alleged violations of California’s Labor Code. Chavez’s
arguments fall in two categories. First, he argues that the district court improperly
exercised diversity jurisdiction in this case. Second, he argues the district court
erred in granting Defendants’ summary judgment motion on the substance of his
overtime, late wage payments, and inaccurate wage statements claims. We have
jurisdiction under 28 U.S.C. § 1291 and we affirm.
1. This court reviews the existence of subject matter jurisdiction de
novo. See Campbell v. Aerospace Corp., 123 F.3d 1308, 1311 (9th Cir. 1997) (per
curiam). Chavez’s argument that the district court could not exercise diversity
jurisdiction in this case fails. First, California’s presence as a real party in interest
to Chavez’s Private Attorney General Act of 2004 (“PAGA”) claim does not
destroy the diversity between the parties. See Urbino v. Orkin Servs. of Cal., Inc.,
726 F.3d 1118, 1123 (9th Cir. 2013) (“The state, as the real party in interest, is not
a ‘citizen’ for diversity purposes.”) (citation omitted).
Second, the record does not compel holding that the district court clearly
erred in finding that Chavez’s asserted damages of $53,250, in addition to the
attorney’s fees Chavez sought, which were permitted by statute and Defendants
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estimated to be $30,000, exceeded the $75,000 amount in controversy requirement.
28 U.S.C. § 1332(a); see Valdez v. Allstate Ins. Co., 372 F.3d 1115, 1117 (9th Cir.
2004) (noting that it is defendant’s burden to establish that the amount in
controversy has been met); Tucson Airport Auth. v. General Dynamics Corp., 136
F.3d 641, 644 (9th Cir. 1998) (stating that this court reviews the district court’s
findings of fact relevant to subject matter jurisdiction for clear error); Galt G/S v.
JSS Scandinavia, 142 F.3d 1150, 1155 (9th Cir. 1998) (holding that attorney’s fees
can be counted toward the amount in controversy requirement when a statute
allows such fees).
Finally, even though Defendants removed the case just over a year after
Chavez commenced this lawsuit in state court, Defendants timely removed the case
to federal court. 28 U.S.C. § 1446(c)(1). Chavez’s argument that an interrogatory
response he provided Defendants put Defendants on notice that they had to remove
the case to federal court fails because, on its face, the interrogatory response did
not clearly state that the amount in controversy exceeded $75,000. 28 U.S.C.
§ 1446(b)(3); see Harris v. Bankers Life and Cas. Co., 425 F.3d 689, 694 (9th Cir.
2005). Further, the district court did not clearly err in determining that Chavez’s
counsel acted in bad faith by waiting over a year to file the statutorily required
notice with California’s Labor and Workforce Development Agency (“LWDA”),
which is a prerequisite to filing suit under PAGA. 28 U.S.C. § 1446(c)(1); see also
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Tedford v. Warner-Lambert, 327 F.3d 423 (5th Cir. 2003); Tucson Airport Auth.,
136 F.3d at 644 (stating that this court reviews the district court’s findings of fact
relevant to subject matter jurisdiction for clear error). Therefore, the district court
did not err in making a finding of bad faith and tolling the time for Defendants to
remove the case to federal district court. 28 U.S.C. § 1446(c)(1).
2. Chavez’s arguments related to the district court’s grant of Defendants’
motion for summary judgment also fail. The record supports the finding that
Chavez was an “outside salesperson” because he spent more than fifty percent of
his time on sales activities, which means he was exempt from California’s
overtime laws. See Ramirez v. Yosemite Water Co., Inc., 20 Cal. 4th 785, 789
(1999) (“Labor Code section 1171 expressly excludes from the overtime laws
employees who are ‘outside salespersons,’ and the California Industrial Welfare
Commission (IWC), the agency charged with implementing section 1171, defined
the term ‘outside salesperson’ in Wage Order No. 7-80, as someone who ‘regularly
works more than half the working time’ engaged in sales activities outside the
workplace.”). His overtime claim therefore fails.
As to Chavez’s claim that Defendants violated Cal. Lab. Code § 204 by
paying his non-salary compensation on a monthly basis, this argument fails
because the record reflects that Chavez’s non-salary compensation based on his
performance was determined on a monthly basis pursuant to Defendants’ Multiple
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Dwelling Unit (“MDU”) Concierge Sales Representative Compensation Plan. Such
agreements are permitted under California law and do not offend § 204. See
Peabody v. Time Warner Cable, Inc., 328 P.3d 1028, 1032 (Cal. 2014); see also
Koehl v. Verio, Inc., 142 Cal.App.4th 1313, 1335 (2006).
Lastly, Chavez’s inaccurate wage statement claim under Cal. Lab. Code
§ 226(a) also fails because § 226(a) does not apply to him as an “outside
salesperson.” Cal. Lab. Code § 226(j)(2)(B); see Peabody v. Time Warner Cable,
Inc. 689 F.3d 1134, 1136 (9th Cir. 2012).
AFFIRMED.
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