Julia Bernstein v. Virgin America, Inc.

FOR PUBLICATION

UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

JULIA BERNSTEIN; ESTHER GARCIA; Nos. 19-15382
LISA MARIE SMITH, on behalf of 20-15186
themselves and all others similarly
situated, D.C. No.
Plaintiffs-Appellees, 4:15-cv-02277-
JST
v.

VIRGIN AMERICA, INC.; ALASKA OPINION
AIRLINES, INC.,
Defendants-Appellants.

Appeal from the United States District Court
for the Northern District of California
Jon S. Tigar, District Judge, Presiding

Argued and Submitted January 14, 2021
San Francisco, California

Filed February 23, 2021

Before: J. CLIFFORD WALLACE and MILAN D.
SMITH, JR., Circuit Judges, and ROBERT S. LASNIK, *
District Judge.

Opinion by Judge Milan D. Smith, Jr.

*
The Honorable Robert S. Lasnik, United States District Judge for
the Western District of Washington, sitting by designation.
2 BERNSTEIN V. VIRGIN AMERICA

SUMMARY **

California Labor Code

The panel affirmed in part, reversed in part, and vacated
the district court’s judgment in a putative class action,
brought by a plaintiff class of California-based flight
attendants who were employed by Virgin America, Inc.,
alleging that Virgin violated California labor laws.

During the Class Period, approximately 25% of Virgin’s
flights were between California airports. Class members
spent approximately 31.5% of their time working within
California’s borders. The district court certified a Class of
all individuals who worked as California-based Virgin flight
attendants during the period from March 18, 2011; a
California Resident Subclass; and a Waiting Time Penalties
Subclass.

As a threshold matter, the panel held that the dormant
Commerce Clause did not bar applying California law in the
context of this case.

The panel reversed the district court’s summary
judgment to plaintiffs on their claims for minimum wage and
payment for all hours worked. Specifically, the panel held
that Virgin’s compensation scheme based on block time did
not violate California law. The fact that pay was not
specifically attached to each hour of work did not mean that
Virgin violated California law.

**
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
 BERNSTEIN V. VIRGIN AMERICA 3

The panel held that under the circumstances of this case,
Virgin was subject to the overtime strictures of California
Labor Code § 510 as to both the Class and California
Resident Subclass.

The panel affirmed the district court’s summary
judgment to plaintiffs on their rest and meal break claims.
The panel rejected Virgin’s contention that federal law
preempted California’s meal and rest break requirements in
the aviation context because federal law occupied the field.
Specifically, the Federal Aviation Act did not occupy the
field of flight attendant meal and rest breaks. Also, conflict
preemption did not bar application of California’s meal and
rest break requirements. Finally, the meal and rest break
requirements were not preempted under the Airline
Deregulation Act. Extrapolating the principles of Sullivan v.
Oracle Corp., 254 P.3d 237 (Cal. 2011), the panel held that
California’s meal and rest break requirements applied to the
work performed by the Class and California Resident
Subclass.

Applying Ward v. United Airlines, Inc., 466 P.3d 309,
321 (Cal. 2020) (holding that California Labor Code
§ 226(a) applied to workers who do not perform the majority
of their work in any one state, but who are based for work
purposes in California), the panel affirmed the district
court’s summary judgment to plaintiffs on their wage
statement claim.

The panel affirmed the district court’s summary
judgment to plaintiffs on their waiting time penalties claim.
Specifically, the panel held that although there was no
California Supreme Court case specifically interpreting the
reach of the waiting time penalties statute – Cal. Labor Code
§§ 201 and 202 – for interstate employees, the analogy to
4 BERNSTEIN V. VIRGIN AMERICA

Cal. Labor Code 226 was compelling. Because the
California Supreme Court held § 226 to apply under these
circumstances, the panel held that §§ 201 and 202 applied as
well.

The panel affirmed the district court’s decision on class
certification. Specifically, the panel held that the
applicability of California law has been adjudicated on a
class-wide or subclass-wide basis, and thus no individual
choice-of-law analysis was necessary.

The panel reversed the district court’s holding that
Virgin was subject to heightened penalties for subsequent
violations under California’s Private Attorney General Act.
Virgin was not notified by the Labor Commissioner or any
court that it was subject to the California Labor Code until
the district court partially granted plaintiff’s motion for
summary judgment. On this basis, the panel held that Virgin
was not subject to heightened penalties for any labor code
violation that occurred prior to that point.

The panel held that since it reversed in part the district
court’s judgment on the merits, California law required that
the panel vacate the attorneys’ fees and costs award. The
panel remanded the issue to the district court.

COUNSEL

Shay Dvoretzky (argued), Skadden Arps Slate Meagher &
Flom LLP, Washington, D.C.; Douglas W. Hall, and
Anthony J. Dick, Jones Day, Washington, D.C.; David J.
Feder, Jones Day, Los Angeles, California; Robert Jon
Hendricks and Brendan T. Killeen, Morgan Lewis &
 BERNSTEIN V. VIRGIN AMERICA 5

Bockius LLP, San Francisco, California; for Defendants-
Appellants.

Charles J. Cooper (argued), Peter A. Patterson, and John D.
Ohlendorf, Cooper & Kirk PLLC, Washington, D.C.;
Monique Olivier (argued), Olivier Schreiber & Chao LLP,
San Francisco, California; James E. Miller, Shepherd
Finkelman Miller & Shah LLP, Chester, Connecticut; Alison
Kosinski, Kosinski & Thiagaraj LLP, San Francisco,
California; for Plaintiffs-Appellees.

Jennifer L. Utrecht (argued) and Mark B. Stern, Appellate
Staff; Joseph H. Hunt, Assistant Attorney General; Civil
Division, United States Department of Justice, Washington,
D.C.; Steven G. Bradbury, General Counsel; Paul M. Geier,
Assistant General Counsel; Charles E. Enloe, Trial Attorney;
United States Department of Transportation, Washington,
D.C.; Arjun Garg, Chief Counsel; Jonathan W. Cross, Senior
Attorney; Federal Aviation Administration; for Amicus
Curiae United States.

Anton Metlitsky and Kendall Turner, O’Melveny & Myers
LLP, New York, New York; Chris Hollinger and Adam
KohSweeney, O’Melveny & Myers LLP, San Francisco,
California; Patricia N. Vercelli, Airlines for America,
Washington, D.C.; Jeffrey N. Shane, International Air
Transport Association, Geneva, Switzerland; for Amici
Curiae Airlines for America and International Air Transport
Association.

Adam G. Unikowsky, Jenner & Block LLP, Washington,
D.C.; Steven P. Lehotsky and Janet Galeria, U.S. Chamber
Litigation Center, Washington, D.C., for Amicus Curiae
Chamber of Commerce of the United States.
6 BERNSTEIN V. VIRGIN AMERICA

Sarah Pierce Wimberly, Andrew Duncan McClintock, and
Jessica Lynn Asbridge, Ford Harrison LLP, Atlanta,
Georgia, for Amicus Curiae Regional Airline Association.

Robert W. Ferguson, Attorney General; Anastasia
Sandstrom, Senior Counsel; Office of the Attorney General,
Seattle, Washington; Phil Weiser, Attorney General,
Denver, Colorado; William Tong, Attorney General,
Hartford, Connecticut, Kathleen Jennings, Attorney
General, Wilmington, Delaware; Karl A. Racine, Attorney
General, Washington, D.C.; Clare E. Connors, Attorney
General, Honolulu, Hawaii; Kwame Raoul, Attorney
General, Springfield, Illinois; Aaron M. Frey, Attorney
General, Augusta, Maine; Maura Healey, Attorney General,
Boston, Massachusetts; Brian E. Frosh, Attorney General,
Baltimore, Maryland; Keith Ellison, Attorney General, St.
Paul, Minnesota; Jim Hood, Attorney General, Jackson,
Mississippi; Aaron D. Ford, Attorney General, Carson City,
Nevada; Gurbir S. Grewal, Attorney General, Trenton, New
Jersey; Letitia James, Attorney General, New York, New
York; Josh Stein, Attorney General, Raleigh, North
Carolina; Ellen F. Rosenblum, Attorney General, Salem,
Oregon; Josh Shapiro, Attorney General, Philadelphia,
Pennsylvania; Thomas J. Donovan Jr., Attorney General,
Montpelier, Vermont; Mark R. Herring, Attorney General,
Richmond, Virginia; for Amici Curiae Washington,
Colorado, Connecticut, Delaware, District of Columbia,
Hawaii, Illinois, Maine, Massachusetts, Maryland,
Minnesota, Mississippi, Nevada, New Jersey, New York,
North Carolina, Oregon, Pennsylvania, Vermont, and
Virginia.

Xavier Becerra, Attorney General; Satoshi Yanai,
Supervising Deputy Attorney General; Mana Barari, Deputy
 BERNSTEIN V. VIRGIN AMERICA 7

Attorney General; California Department of Justice, Los
Angeles, California; for Amicus Curiae State of California.

Kathleen P. Barnard, Darin M. Dalmat, and Kelly Ann
Skahan, Barnard Iglitzin & Lavitt LLP, Seattle, Washington,
for Amicus Curiae Association of Flight Attendants-
Communication Workers of America, AFL-CIO.

OPINION

M. SMITH, Circuit Judge:

This case requires us to determine whether certain
provisions of the California Labor Code apply to an
interstate transportation company’s relationship with its
employees. Plaintiffs Julia Bernstein, Esther Garcia, and
Lisa Smith sued their employer, Virgin America, Inc.,
alleging that Virgin violated a host of California labor laws.
The district court certified a class of similarly-situated
plaintiffs and granted summary judgment to Plaintiffs on
virtually all of their claims, and Virgin appealed. We affirm
in part, reverse in part, and remand for further proceedings.

FACTUAL AND PROCEDURAL BACKGROUND

Plaintiffs are California-based flight attendants who
were employees of Virgin. During the Class Period,
approximately 25% of Virgin’s flights were between
California airports. Approximately 75% of Virgin’s flights
took off or landed at a non-California airport, but the vast
majority of those flights retained some connection to
California: “From 2011 through 2016, the daily percentage
of Virgin’s flights that arrived in or departed from California
airports was never less than 88%, and during some years
reached 99%.” Class members spent approximately 31.5%
8 BERNSTEIN V. VIRGIN AMERICA

of their time working within California’s borders. There is
no evidence in the record to suggest that class members spent
more than 50% of their time working in any one state, or that
they worked in any other state more than they worked in
California. Virgin’s fleet of aircraft were registered with the
Federal Aviation Administration at Virgin’s headquarters in
Burlingame, California, and the record does not reflect any
other business headquarters.

In their complaint, Plaintiffs alleged that Virgin failed to
pay minimum wage (Cal. Lab. Code §§ 1182.12, 1194,
1194.2), overtime (Cal. Lab. Code §§ 510, 1194), and for
every hour worked (Cal. Lab. Code § 204); failed to provide
required meal periods (Cal. Lab. Code §§ 226.7, 512), rest
breaks (Cal. Lab. Code § 226.7), and accurate wage
statements (Cal. Lab. Code § 226); failed to pay waiting time
penalties 1 (Cal. Lab. Code §§ 201, 202, 203); and violated
the Unfair Competition Law (Cal. Bus. & Prof. Code
§ 17200). Plaintiffs also sought compensation under the
California Labor Code’s Private Attorneys General Act (Cal.
Lab. Code § 2698) (PAGA).

Virgin disputes that it is subject to California law, but
does not contend that any other state’s labor laws ought to
apply to it.

In November 2016, the district court held that Plaintiffs
satisfied the requirements for a class action pursuant to
Federal Rule of Civil Procedure 23(b)(3), and certified the
following classes:

1
Waiting time penalties refer to the California requirement that
employers expeditiously pay all wages due to employees who separate
from employment. If an employer fails to comply, it is liable for
“waiting time penalties” pursuant to the Labor Code.
 BERNSTEIN V. VIRGIN AMERICA 9

Class: All individuals who have worked as
California-based flight attendants of Virgin
America, Inc. at any time during the period
from March 18, 2011 (four years from the
filing of the original Complaint) through the
date established by the Court for notice of
certification of the Class (the “Class Period”).

California Resident Subclass: All
individuals who have worked as California-
based flight attendants of Virgin America,
Inc. while residing in California at any time
during the Class Period.

Waiting Time Penalties Subclass: All
individuals who have worked as California-
based flight attendants of Virgin America,
Inc. and have separated from their
employment at any time since March 18,
2012.

On July 9, 2018, the district court granted Plaintiffs’
Motion for Summary Judgment in large part. The district
court held that the California Labor Code applied to all work
performed in California, and that “the presumption against
extraterritorial application does not apply for the failure to
pay for all hours worked, to pay overtime, to pay waiting
time penalties, and to provide accurate wage statements”
because the conduct underlying those claims took place in
California. The district court also rejected the “job situs” test
Virgin proposed, holding that, under California law, an
employee need not work “exclusively or principally” in
California to benefit from California law.
10 BERNSTEIN V. VIRGIN AMERICA

With respect to the dormant Commerce Clause
arguments, the district court held that application of the
California Labor Code does not violate the dormant
Commerce Clause because the California Labor Code does
not impose a substantial burden on interstate commerce that
is “clearly excessive in relation to the putative local
benefits.” Pike v. Bruce Church, Inc., 397 U.S. 137, 142
(1970). The district court further held that the California
meal and rest break requirements were not preempted by
field, conflict, or express preemption pursuant to the Federal
Aviation Act (FAA) or the Airline Deregulation Act (ADA).
The district court awarded PAGA penalties for initial and
subsequent violations of the Labor Code.

The district court then awarded attorney’s fees and costs
to Plaintiffs’ counsel, excluding 148.1 hours that were not
properly documented, reducing the award for “complaint
and client communications” time by 10%, and imposing a
5% reduction to the remaining hours. The district court then
applied a 2.0 multiplier based on the factors set forth in
Ketchum v. Moses, 17 P.3d 735, 741–42 (Cal. 2001). The
district court awarded the full amount of costs that Plaintiffs’
counsel claimed based on its conclusion that the amounts
claimed were reasonable. Virgin appealed from the district
court’s summary judgment and grant of attorney’s fees, and
the cases were consolidated for oral argument.

STANDARD OF REVIEW

We have jurisdiction pursuant to 28 U.S.C. § 1291. We
review the district court’s grant of summary judgment de
novo. United States v. Phattey, 943 F.3d 1277, 1280 (9th
Cir. 2019). Our task is to “view the evidence in the light
most favorable” to Virgin “and determine whether there are
any genuine issues of material fact and whether the district
 BERNSTEIN V. VIRGIN AMERICA 11

court correctly applied the relevant substantive law.” Id.
(cleaned up).

We review a district court’s decision on a motion for
attorney’s fees for abuse of discretion. Cline v. Indus. Maint.
Eng’g & Contracting Co., 200 F.3d 1223, 1235 (9th Cir.
2000).

ANALYSIS

A.

As a threshold matter, we must consider whether the
dormant Commerce Clause permits application of California
labor law in the context of this case. We hold that the
dormant Commerce Clause does not bar applying California
law.

“Modern dormant Commerce Clause jurisprudence
primarily ‘is driven by concern about economic
protectionism—that is, regulatory measures designed to
benefit in-state economic interests by burdening out-of-state
competitors.’” Nat’l Ass’n of Optometrists & Opticians v.
Harris, 682 F.3d 1144, 1148 (9th Cir. 2012) (quoting Dep’t
of Revenue of Ky. v. Davis, 553 U.S. 328, 337–38 (2008)).
“[A] state regulation does not become vulnerable to
invalidation under the dormant Commerce Clause merely
because it affects interstate commerce. A critical
requirement for proving a violation of the dormant
Commerce Clause is that there must be a substantial burden
on interstate commerce.” Id. (citation omitted). “These
other significant burdens on interstate commerce generally
result from inconsistent regulation of activities that are
inherently national or require a uniform system of
regulation.” Id.
12 BERNSTEIN V. VIRGIN AMERICA

Indeed, only a “small number” of Supreme Court cases
“have invalidated state laws under the dormant Commerce
Clause that appear to have been genuinely
nondiscriminatory . . . where such laws undermined a
compelling need for national uniformity in regulation.” Gen.
Motors Corp. v. Tracy, 519 U.S. 278, 298 n.12 (1997).
Among these are Bibb v. Navajo Freight Lines, Inc.,
359 U.S. 520 (1959), and Southern Pacific Company v.
Arizona, 325 U.S. 761 (1945). Virgin relies on these cases,
but they do not help its legal position.

In Bibb, the Arkansas Commerce Commission required
straight mudflaps on trailers operating on state highways; an
Illinois statute required curved mudflaps. 359 U.S. at 527.
“Thus[,] if a trailer [were] to be operated in both States,
mudguards would have to be interchanged, causing a
significant delay in an operation where prompt movement
may be of the essence.” Id. Moreover, the interchange was
laborious and could be “exceedingly dangerous.” Id. The
Supreme Court struck down the Illinois statute under the
dormant Commerce Clause based on “the rather massive
showing of burden on interstate commerce which [the motor
carriers] made at the hearing.” Id. at 528, 530.

In Southern Pacific, Arizona limited freight trains to
seventy cars and passenger trains to fourteen cars, differing
substantially from nearby states’ length limitations.
325 U.S. at 771, 774. Railroad operations passing through
Arizona were substantially burdened by the obligation to
break up and remake trains at the Arizona state border. Id.
at 772. The Supreme Court held that the facts in the record
showed “[t]he serious impediment to the free flow of
commerce by the local regulation of train lengths and the
practical necessity that such regulation, if any, must be
prescribed by a single body having a nation-wide authority.”
 BERNSTEIN V. VIRGIN AMERICA 13

Id. at 775. These cases stand for the principle that state
regulations can violate the dormant Commerce Clause in the
rare case where an interstate carrier must comply with
different and incompatible state requirements, and where
that compliance is substantially burdensome.

We are not persuaded that California’s labor laws are
similar in character and effect to Illinois’s mudflaps decree
and Arizona’s train-length limitation. Virgin has not
identified any other state labor laws with which it might be
required to comply. Indeed, because California labor law’s
application is based upon the parties’ various contacts with
the state—as explained further below—a claim that a
proliferation of similar state laws would substantially burden
Virgin is dubious. Virgin does not have anything like the
number of contacts with any other state that it has with
California, and it fails to proffer evidence of any burden it
allegedly suffers from doing business in other states with
different regulations. Cf. Valley Bank of Nev. v. Plus Sys.,
Inc., 914 F.2d 1186, 1192 (9th Cir. 1990) (distinguishing
between the facts presented in Bibb and a case where the
defendant merely “speculate[d] that other states will pass
similar but inconsistent legislation,” because “inconsistent
state laws . . . can coexist without conflict as long as each
state regulates only its own [entities]”). We hold that the
dormant Commerce Clause is not implicated in this case.

B.

Virgin challenges application of California law to both
the Class and the California Resident Subclass. But Virgin’s
proposed “job situs” test is a misinterpretation of California
law. According to the California Supreme Court:

The better question is what kinds of
California connections will suffice to trigger
14 BERNSTEIN V. VIRGIN AMERICA

the relevant provisions of California law.
And second, the connections that suffice for
purposes of one statute may not necessarily
suffice for another. There is no single, all-
purpose answer to the question of when state
law will apply to an interstate employment
relationship or set of transactions. As is true
of statutory interpretation generally, each law
must be considered on its own terms.

Ward v. United Airlines, Inc., 466 P.3d 309, 319 (Cal. 2020).
In accordance with Ward, each of Plaintiffs’ claims requires
separate analysis to determine whether the California
Supreme Court would apply California law to the Class and
Subclass under the circumstances of this case. Cf. Pacheco
v. United States, 220 F.3d 1126, 1131 (9th Cir. 2000) (“[W]e
must predict as best we can what the California Supreme
Court would do in these circumstances.”). Where there is no
genuine issue of material fact whether Virgin complied with
California law, we decline to determine whether and how the
California Supreme Court would apply that particular law to
Virgin.

a. Minimum wage and compensation for all hours
worked

California Labor Code § 1182.12(a) prescribes “the
minimum wage for all industries.” Section 204(a) requires
that “[a]ll wages . . . earned by any person in any
employment are due and payable twice during each calendar
month.” Cal. Lab. Code § 204(a). After the district court’s
ruling in this case, the California Supreme Court considered
whether a virtually identical compensation scheme violated
California law for payment of minimum wage and payment
 BERNSTEIN V. VIRGIN AMERICA 15

for all hours worked. The court held that a payment scheme
based on block time does not violate California law where

the scheme, taken as a whole, does not
promise any particular compensation for any
particular hour of work; instead, . . . it offers
a guaranteed level of compensation for each
duty period and each rotation. Because there
are no on-duty hours for which Delta
contractually guarantees certain pay—but
from which compensation must be borrowed
to cover other un- or undercompensated on-
duty hours—the concerns presented by the
compensation scheme in [Armenta v.
Osmose, Inc., 37 Cal. Rptr. 3d 460 (Ct. App.
2005)] and like cases are absent here.

Oman v. Delta Air Lines, Inc., 466 P.3d 325, 339 (Cal. 2020)
(emphases omitted).

Plaintiffs attempt to distinguish their case by noting that,
while Delta promised the Oman plaintiffs payment “by the
rotation rather than by particular hours worked,” Virgin
promised them an hourly wage. However, Plaintiffs’ prior
briefing contradicts this assertion. Instead, Plaintiffs’
answering brief stated that Virgin paid flight attendants
based on “(1) block time worked each day of the pairing;
(2) block time spent deadheading (traveling between airports
to reach an assigned flight . . .); and (3) up to 3.5 hours of
minimum duty if a flight attendant’s block time and
deadheading time in one day did not exceed 3.5 hours in
total.” This does not reflect a promise to pay a particular
hourly wage.

Second, Plaintiffs contend that, unlike Delta’s scheme in
Oman, Virgin’s did not guarantee “that flight attendants are
16 BERNSTEIN V. VIRGIN AMERICA

always paid above the minimum wage for the hours worked
during each rotation.” See Oman, 466 P.3d at 338. Plaintiffs
posit that a Virgin flight attendant could be ordered to report
for duty five hours prior to their scheduled flight, but not be
paid for any of that time. However, Plaintiffs have not
alleged that this ever happened, nor that it would plausibly
happen. Thus, the rule from Oman controls. The fact that
pay is not specifically attached to each hour of work does not
mean that Virgin violated California law. We therefore
reverse the district court’s summary judgment to Plaintiffs
on their claims for minimum wage and payment for all hours
worked.

b. Overtime

Under California law,

Any work in excess of eight hours in one
workday and any work in excess of 40 hours
in any one workweek and the first eight hours
worked on the seventh day of work in any one
workweek shall be compensated at the rate of
no less than one and one-half times the
regular rate of pay for an employee. Any
work in excess of 12 hours in one day shall
be compensated at the rate of no less than
twice the regular rate of pay for an employee.
In addition, any work in excess of eight hours
on any seventh day of a workweek shall be
compensated at the rate of no less than twice
the regular rate of pay of an employee.

Cal. Lab. Code § 510(a).

In Sullivan v. Oracle Corp., 254 P.3d 237 (Cal. 2011),
the California Supreme Court held that the overtime
 BERNSTEIN V. VIRGIN AMERICA 17

provision applied to non-residents performing work in
California for a California-based employer. Id. at 240–41.
This holding compels the conclusion that California’s
overtime provision applies to the Plaintiff Class. Sullivan
did not answer whether the overtime provision would apply
to residents performing work outside California for a
California-based employer, i.e., the Plaintiff California
Resident Subclass. However, the principles set forth in
Sullivan require us to apply California overtime law to
California residents’ out-of-state work. In Sullivan, the court
wrote, “To permit nonresidents to work in California without
the protection of our overtime law would completely
sacrifice, as to those employees, the state’s important public
policy goals of protecting health and safety and preventing
the evils associated with overwork.” Id. at 247. The same
public policy goals would be thwarted by permitting
residents to work outside of California for a California
employer without the protection of its overtime law. Thus,
we hold that under the circumstances of this case, Virgin was
subject to the strictures of California Labor Code § 510 as to
both the Class and Subclass.

Virgin’s opening brief did not dispute that it failed to
comply with § 510. Accordingly, we affirm the district
court’s grant of summary judgment to Plaintiffs on this
claim.

c. Rest and meal breaks

i. Preemption

California Labor Code § 512(a) states:

An employer shall not employ an employee
for a work period of more than five hours per
day without providing the employee with a
18 BERNSTEIN V. VIRGIN AMERICA

meal period of not less than 30 minutes . . . .
An employer shall not employ an employee
for a work period of more than 10 hours per
day without providing the employee with a
second meal period of not less than
30 minutes[.]

IWC Wage Order 9-2001 § 12(A) requires an
“authorized rest period time” that is “based on the total hours
worked daily at the rate of ten (10) minutes net rest time per
four (4) hours or major fraction thereof.” “[I]nsofar as
practicable,” the rest period “shall be in the middle of each
work period.” Id. Virgin contends that federal law preempts
California’s meal and rest break requirements in the aviation
context because federal law occupies the field. We disagree.

Under the field preemption doctrine,

States are precluded from regulating conduct
in a field that Congress, acting within its
proper authority, has determined must be
regulated by its exclusive governance. The
intent to displace state law altogether can be
inferred from a framework of regulation so
pervasive that Congress left no room for the
States to supplement it or where there is a
federal interest so dominant that the federal
system will be assumed to preclude
enforcement of state laws on the same
subject.

Arizona v. United States, 567 U.S. 387, 399 (2012) (cleaned
up). Pursuant to the FAA, federal regulations entitled
“Flight attendant duty period limitations and rest
requirements” were promulgated that prohibit duty periods
 BERNSTEIN V. VIRGIN AMERICA 19

of more than 14 hours, subject to certain exceptions, and
require a 9-hour rest period after release from a duty period
of 14 hours or less. 14 C.F.R. § 121.467(b)(1)–(2).

Although our circuit has not yet addressed the precise
question of FAA preemption of state meal and rest break
requirements, our case law makes clear that field preemption
generally applies to state regulations specifically in the field
of aviation safety. In Montalvo v. Spirit Airlines, 508 F.3d
464, 468 (9th Cir. 2007), we held that Congress intended to
occupy the field of “aviation safety.” This was based on the
dominance of federal interests in regulation of the country’s
airspace, the passage of the FAA “in response to a series of
fatal air crashes between civil and military aircraft operating
under separate flight rules,” and delegation of “full
responsibility and authority for the . . . promulgation and
enforcement of safety regulations” to the agency. Id. at 471–
72 (alteration in original). We noted that the FAA also
directed the Administrator “to regulate any ‘other practices,
methods, and procedure the Administrator finds necessary
for safety in air commerce and national security.’” Id. at 472
(quoting 49 U.S.C. § 44701(a)(5)).

In Ventress v. Japan Airlines, 747 F.3d 716 (9th Cir.
2014), we held that standards for pilots were also pervasively
regulated because the FAA authorized the agency “to issue
airman certificates to individuals who are qualified and
physically able to perform the duties related to the certified
position.” Id. at 721. The plaintiff’s retaliation and
constructive discharge claims arising out of California’s
whistleblowing statute (after the plaintiff raised concerns
about a colleague’s fitness to fly) were therefore preempted.
Id. at 722. Ventress made clear that a congressional interest
in national aviation safety standards served as a basis for our
holding that federal law preempted the state law claim at
20 BERNSTEIN V. VIRGIN AMERICA

issue. Ventress relied on “two reasons: the pervasiveness of
federal safety regulations for pilots and the congressional
goal of a uniform system of aviation safety.” Id. We again
emphasized the congressional interest in national aviation
safety standards when we wrote, “In reaching this
conclusion, we need not, and do not, suggest that the FAA
preempts all retaliation and constructive termination claims
brought under California law . . . . Instead, we hold that
federal law preempts state law claims that encroach upon,
supplement, or alter the federally occupied field of aviation
safety[.]” Id. at 722–23 (emphasis added).

Virgin contends that meal and rest breaks touch on
aviation safety in that the California requirements prohibit
employers from assigning duties to an employee who is on a
meal or rest break. But this connection is far too tenuous to
support field preemption for California’s requirements.
Unlike the state laws at issue in Montalvo and Ventress,
California’s meal and rest break requirements have no direct
bearing on the field of aviation safety.

We recognize that field preemption under the FAA is not
necessarily limited to state laws that regulate aviation safety.
In general, where a federal regulatory scheme is so pervasive
that it evinces an intent to occupy the field, state regulations
in the same field are preempted. Martin v. Midwest Express
Holdings, Inc., 555 F.3d 806, 811 (9th Cir. 2009). However,
14 C.F.R. § 121.467, the federal regulation governing
maximum duty periods for flight attendants, does not
resemble the type of comprehensive regulation or contain the
pervasive language that we consider necessary to discern
congressional intent to occupy the field. See Ventress,
747 F.3d at 721–22 (discussing at least five different
sections under two titles of regulations relating to the
requirement for an airman certificate, the requirement of a
 BERNSTEIN V. VIRGIN AMERICA 21

medical certificate, the delegation of the authority to issue a
certificate to the Federal Air Surgeon, and the promulgation
of standards for mental, neurological, and general medical
conditions for the medical certificate). When a single
regulation has triggered field preemption, our court has
highlighted the regulation’s “exhaustive” level of detail. See
Nat’l Fed’n of the Blind v. United Airlines Inc., 813 F.3d
718, 734–35 (9th Cir. 2016) (holding that 14 C.F.R. § 382.57
occupies the field of airport kiosk accessibility for the blind
in part because it is “unmistakably pervasive in the pertinent
sense, in that it exhaustively regulates the relevant attributes
of accessible kiosks,” including numerous “technical and
design requirements”). While § 121.467 is lengthy, it only
discusses allowed duty period lengths. The regulation does
not compel us to conclude that Congress left no room for
states to prescribe meal periods and ten-minute rest breaks
within the maximum total duty period allowed under federal
law.

Conflict preemption also does not bar application of
California’s meal and rest break requirements. Conflict
preemption only applies “where compliance with both
federal and state regulations is a physical impossibility.”
Ventress, 747 F.3d at 720. It is physically possible to comply
with federal regulations prohibiting a duty period of longer
than fourteen hours and California’s statutes requiring ten-
minute rest breaks and thirty-minute meal periods at specific
intervals. Thus, California’s meal and rest break
requirements also survive under a conflict preemption
analysis.

Finally, California’s meal and rest break requirements
are also not preempted under the ADA. The ADA provides:
“a State . . . may not enact or enforce a law, regulation, or
other provision having the force and effect of law related to
22 BERNSTEIN V. VIRGIN AMERICA

a price, route or service of an air carrier[.]” 49 U.S.C.
§ 41713(b)(1). In discussing an identical provision in the
trucking context, the Supreme Court “identified four
principles” of the law’s preemption:

(1) state enforcement actions having a
connection with, or reference to, carrier rates,
routes, or services are pre-empted; (2) such
pre-emption may occur even if a state law’s
effect on rates, routes or services is only
indirect; (3) it makes no difference whether a
state law is consistent or inconsistent with
federal regulation; and (4) pre-emption
occurs at least where state laws have a
significant impact related to Congress’
deregulatory and pre-emption-related
objectives.

Dilts v. Penske Logistics, LLC, 769 F.3d 637, 645 (9th Cir.
2014) (quoting Rowe v. N.H. Motor Transp. Ass’n, 552 U.S.
364, 370–71 (2008)) (cleaned up). But “background
regulations that are several steps removed from prices,
routes, or services, such as prevailing wage laws or safety
regulations, are not preempted, even if employers must
factor those provisions into their decisions about the prices
that they set, the routes that they use, or the services that they
provide.” Id. at 646. Where a law bears a reference to rates,
routes, or services, the Supreme Court has held that the law
“relates to” those items and is therefore preempted. Morales
v. Trans World Airlines, Inc., 504 U.S. 374, 388–89 (1992)
(prohibition on deceptive advertising of airfare was
preempted). Where a law bears no such reference, “the
proper inquiry is whether the provision, directly or
indirectly, binds the carrier to a particular price, route, or
service and thereby interferes with the competitive market
 BERNSTEIN V. VIRGIN AMERICA 23

forces within the industry.” Dilts, 769 F.3d at 646 (quoting
Am. Trucking Ass’ns, Inc. v. City of L.A., 660 F.3d 384, 397
(9th Cir. 2011)).

In Dilts, we interpreted the preemption clause in the
Federal Aviation Administration Authorization Act of 1994
(FAAA), which provided, “States may not enact or enforce
a law related to a price, route, or service of any motor carrier
with respect to the transportation of property.” 769 F.3d at
643 (quoting 49 U.S.C. § 14501(c)(1) (internal quotation
marks and alterations omitted)). We held that the FAAA did
not preempt California’s meal and rest break requirements
as applied to the interstate trucking industry. In our opinion,
we wrote that “Congress did not intend to preempt generally
applicable state transportation, safety, welfare, or business
rules that do not otherwise regulate prices, routes, or
services.” Id. at 644. Moreover, an increase in cost
associated with compliance was not sufficient to show a
relation to prices, routes, or services. Id. at 646.

The language of the ADA’s preemption clause is
virtually identical to the language of the FAAA’s. The
reasoning of Dilts thus applies with equal force here. Just as
the FAAA did not preempt California’s meal and rest break
requirements as applied to the trucking industry, the ADA
does not preempt those requirements as applied to the airline
industry.

ii. Application

After establishing that California’s meal and rest break
requirements are not preempted, we next address whether
these requirements apply to the work performed by the Class
and Subclass under California law. Extrapolating the
principles of Sullivan, we hold that they do.
24 BERNSTEIN V. VIRGIN AMERICA

In Sullivan, the California Supreme Court emphasized
the California Legislature’s public policy goals in the
context of California’s overtime statute. Among these goals
was “protecting employees in a relatively weak bargaining
position from the evils associated with overwork[.]”
254 P.3d at 241. Based on this state policy, and others, the
California Supreme Court held that “[t]o exclude
nonresidents from the overtime laws’ protection would tend
to defeat their purpose by encouraging employers to import
unprotected workers from other states,” and that “[n]othing
in the language or history of the relevant statutes suggests
the Legislature ever contemplated such a result.” Id. at 242.
The California Supreme Court concluded that application of
the overtime statute to nonresidents, as well as residents, was
the only feasible way “to reconcile with the Legislature’s
express declaration that ‘all protections, rights, and remedies
available under state law are available to all individuals who
are or who have been employed, in this state.’” Id. (quoting
Cal. Lab. Code § 1171.5(a) (alterations omitted)).

We hold that policy similarly dictates application of
California’s meal and rest break requirements to both the
Class and Subclass. Like overtime pay, meal and rest break
requirements are designed to prevent “the evils associated
with overwork,” mandating that employers treat employees
humanely even when employees have been unable to bargain
for that contractual right. Thus, like overtime pay, meal and
rest break requirements applied to Virgin’s relationship with
both the Class and Subclass. Virgin’s opening brief does not
contend that it complied with California’s meal and rest
break requirements. We thus affirm the district court’s
summary judgment to Plaintiffs on these claims.
 BERNSTEIN V. VIRGIN AMERICA 25

d. Wage statements

California Labor Code § 226(a) states:

An employer, semimonthly or at the time of
each payment of wages, shall furnish to his or
her employee . . . an accurate itemized
statement in writing showing (1) gross wages
earned, (2) total hours worked by the
employee . . . , (3) the number of piece-rate
units earned and any applicable piece rate if
the employee is paid on a piece-rate basis,
(4) all deductions, . . . (5) net wages earned,
(6) the inclusive dates of the period for which
the employee is paid, (7) the name of the
employee and only the last four digits of his
or her social security number or an employee
identification number . . . , (8) the name and
address of the legal entity that is the employer
. . . , and (9) all applicable hourly rates in
effect during the pay period and the
corresponding number of hours worked at
each hourly rate by the employee[.]

The California Supreme Court has determined that § 226
applies to workers who “perform the majority of their work
in California; but if they do not perform the majority of their
work in any one state, they will be covered if they are based
for work purposes in California.” Ward, 466 P.3d at 321.

Ward controls here. According to Virgin’s expert, “class
members collectively worked only 31.5% of their time in
California.” There is, however, no evidence that the class
members performed “the majority of their work in any one
state,” and, indeed, the record compels the inference that if
26 BERNSTEIN V. VIRGIN AMERICA

Plaintiffs did not work in California for a majority of their
time, they did not do so in any state.

Furthermore, Virgin itself classified all Plaintiffs in this
action as being California-based. Virgin somewhat
speciously contends that when it classified Plaintiffs as
California-based, it meant that term in a different sense than
the Ward court used it. This argument is unavailing. The
court in Ward wrote, “the Legislature intended for section
226 to apply to workers whose work is not performed
predominantly in any one state, provided that California is
the state that has the most significant relationship to the
work.” Id. Thus, the California Supreme Court
“conclude[d] this principle will be satisfied if the worker
performs some work here and is based in California,
meaning that California serves as the physical location
where the worker presents himself or herself to begin work.”
Id. Virgin’s argument hinges on the final sentence—it
asserts that many plaintiffs did not “present” themselves to
“begin work” in California because Plaintiffs’ pairings
began and ended outside the state.

Virgin’s argument fails for two reasons. First, Ward
makes clear that presentation in California to begin work is
one way in which a plaintiff might be based in California; it
is not the only way. Id. (holding that the principle behind
§ 226 “will be satisfied if” it applies to the class of workers
who present themselves to begin work in California, not that
it cannot apply under other circumstances). Second, a
plaintiff whose pairings begin and end in New York, but
include flights that depart from California, would
presumably still “present” herself mid-pairing to “begin
work” in California when she arrived at the airport for that
flight. Thus, under Ward, § 226 applies to Virgin. Virgin’s
opening brief does not contend that it complied with § 226.
 BERNSTEIN V. VIRGIN AMERICA 27

We therefore affirm the district court’s summary judgment
to Plaintiffs on their wage statement claim.

e. Waiting time penalties

California Labor Code § 201(a) states, “If an employer
discharges an employee, the wages earned and unpaid at the
time of discharge are due and payable immediately.”
Section 202(a) further provides, “If an employee not having
a written contract for a definite period quits his or her
employment, his or her wages shall become due and payable
not later than 72 hours thereafter, unless the employee has
given 72 hours previous notice of his or her intention to quit,
in which case the employee is entitled to his or her wages at
the time of quitting.” Section 203 sets forth penalties for
failure to comply with §§ 201 and 202.

Although there is no California Supreme Court case
specifically interpreting the reach of the waiting time
penalties statute for interstate employers, we find an analogy
to § 226 compelling. Both the waiting time penalties and the
wage statement requirements pertain to a tangible object that
the employer must give to the employee. Both requirements
are technical in nature: section 226 specifies the information
a wage statement must contain, and the waiting time
penalties specify the time in which an employer must remit
an employee’s wages after separation from employment.
Thus, using Ward’s language, the “kinds of California
connections” that “will suffice to trigger the” two provisions
are the same. See Ward, 466 P.3d at 319. Because the
California Supreme Court held § 226 to apply under these
circumstances, we hold that §§ 201 and 202 apply as well.
Virgin’s opening brief does not dispute that it failed to
comply with §§ 201 and 202. Consequently, we affirm the
district court’s summary judgment to Plaintiffs on their
waiting time penalties claim.
28 BERNSTEIN V. VIRGIN AMERICA

C.

Pursuant to Federal Rule of Civil Procedure 23, a class
may be certified if “the class is so numerous that joinder of
all members is impracticable”; “there are questions of law or
fact common to the class”; “the claims or defenses” of the
named plaintiffs are typical of those of the class; and the
named plaintiffs “will fairly and adequately protect the
interests of the class.” Fed. R. Civ. P. 23(a)(1)–(4).
Additionally, Plaintiffs must show that “questions of law or
fact common to class members predominate” over individual
questions, “and that a class action is superior to other
available methods for fairly and efficiently adjudicating the
controversy.” Fed. R. Civ. P. 23(b)(3). Of these
requirements, Virgin challenges only the last: that class
adjudication is the superior method. Virgin claims that class
adjudication is inappropriate because choice-of-law analyses
will be required for each plaintiff. Pursuant to our analysis,
the applicability of California law has been adjudicated on a
class-wide or subclass-wide basis, and thus no individual
choice-of-law analysis is necessary. We affirm the district
court’s decision on class certification.

D.

Finally, we consider whether the district court correctly
held that Virgin was subject to heightened penalties for
subsequent violations under PAGA. PAGA permits
individuals to sue their employers to recover penalties to
which they are entitled under the Labor Code. Cal. Lab.
Code § 2699(a). Where the section violated does not
indicate the amount of the penalty for its violation, PAGA
fixes the penalty at $100 “for each aggrieved employee per
pay period for the initial violation,” and $200 “for each
aggrieved employee per pay period for each subsequent
violation.” Id. § 2699(f)(2).
 BERNSTEIN V. VIRGIN AMERICA 29

Under California law, “[a] good faith dispute” that an
employer is required to comply with a particular law “will
preclude imposition” of heightened penalties. Amaral v.
Cintas Corp. No. 2, 78 Cal. Rptr. 3d 572, 607 (Ct. App.
2008). “A ‘good faith dispute’ . . . occurs when an employer
presents a defense, based in law or fact which, if successful,
would preclude any recover[y] on the part of the employee.”
Id. “Until the employer has been notified that it is violating
a Labor Code provision (whether or not the [Labor]
Commissioner or court chooses to impose penalties), the
employer cannot be presumed to be aware that its continuing
underpayment of employees is a ‘violation’ subject to
penalties.” Id. at 614.

Virgin was not notified by the Labor Commissioner or
any court that it was subject to the California Labor Code
until the district court partially granted Plaintiffs’ motion for
summary judgment. On this basis, we reverse the district
court’s holding that Virgin is subject to heightened penalties
for any labor code violation that occurred prior to that point.

E.

Since we reverse in part the district court’s judgment on
the merits, California law requires that we vacate the
attorney’s fees and costs award “because we cannot say with
certainty that the [district] court would exercise its discretion
the same way” had Plaintiffs not prevailed on virtually all of
their claims. Ventas Finance I, LLC v. Franchise Tax Bd.,
81 Cal. Rptr. 3d 823, 844 (Ct. App. 2008). We therefore
vacate the district court’s order awarding fees and costs to
Plaintiffs’ counsel, and we remand the issue of attorney’s
fees and costs to the district court.
30 BERNSTEIN V. VIRGIN AMERICA

CONCLUSION

In sum, we affirm the district court’s summary judgment
to Plaintiffs on their claims for overtime (§ 510); for
violation of meal and rest break requirements (§§ 226.7,
512); for wage statement deficiencies (§ 226); and for
waiting time penalties (§§ 201 and 202). We also affirm the
district court’s decision on class certification. We reverse
the district court’s summary judgment to Plaintiffs on their
claims for minimum wage (§ 1182.12); for payment for each
hour worked (§ 204); and for heightened penalties for
subsequent violations under PAGA. We vacate the district
court’s order granting attorney’s fees and costs to Plaintiffs,
and we remand for further proceedings consistent with this
opinion.

AFFIRMED IN PART, REVERSED IN PART,
VACATED IN PART.