Ali v. Auto Nation CA4/1

Filed 7/14/21 Ali v. Auto Nation CA4/1
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.

COURT OF APPEAL, FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

GHANDI ALI, D077323
Plaintiff and Respondent,

v.
(Super. Ct. No. 37-2018-00037616-
CU-OE-CTL)
AUTO NATION, INC. et al.,
Defendants and Respondents;

DEVONTE MITCHEM et al.,
Movants and Appellants.

APPEAL from an order and judgment of the Superior Court of San
Diego County, Ronald F. Frazier, Judge. Affirmed.
Matern Law Group, Matthew J. Matern, Launa Adolph, Debra J.
Tauger and Kayvon Sabourian, for Movants and Appellants.
Ackermann & Tilajef, Craig J. Ackerman, Sam Vahedi; Winston Law
Group, David S. Winston; Melmed Law Group and Jonathan Melmed, for
Plaintiff and Respondent.
 Fisher & Phillips, Christopher C. Hoffman and Megan E. Walker, for
Defendants and Respondents.
INTRODUCTION
Devonte Mitchem and Niki Phuong Ngo filed a representative action
against their employer Auto Nation, Inc. (Auto Nation) in April 2018. In July
2018, Ghandi Ali filed a separate, representative action against the
defendants, identifying many of the same labor law violations. Ali and the
defendants proceeded to mediation and reached a settlement. When they
filed their joint motion for court approval of the settlement, Mitchem and Ngo
moved to intervene in the matter as a right and, in the alternative, they
sought permissive intervention. Mitchem and Ngo also objected to the
settlement, arguing it was not fair. The court denied their requests to
intervene, but it considered their objections before approving the PAGA
settlement. Before the time elapsed for Mitchem and Ngo to appeal the
denial of their requests to intervene, the settlement funds were distributed to
the state and to the aggrieved employees.
Mitchem and Ngo appeal the denial of their requests to intervene, as
well as the entry of judgment, arguing the settlement was improper and
unfair. Ali and Auto Nation contend the court properly denied the requests
to intervene, challenge Mitchem and Ngo’s standing to appeal the judgment,
question whether the appeal is moot in light of the distribution of settlement
funds, and maintain that the court properly concluded the settlement was
fair. We agree with Ali and Auto Nation that the court properly denied the
requests to intervene. We question whether the parties to the settlement can
avoid appellate review based on the distribution of settlement funds and
whether Mitchem and Ngo have standing to appeal the judgment, but even

2
assuming Mitchem and Ngo have standing to challenge the judgment, we
affirm because the court’s approval of the settlement did not abuse its
discretion.
BACKGROUND AND PROCEDURAL FACTS
On July 24, 2018, Ali filed a representative action pursuant to the
Private Attorney General Act (PAGA) (Labor Code, § 2698 et seq.) against
Auto Nation and several other related entities (the Ali matter). His
complaint was brought on behalf of nine groups of allegedly aggrieved
employees, including those who were paid on a commission basis, those who
earned less than half their compensation from commissions, and those who
had resigned or had been discharged. It alleged a variety of violations of the
Labor Code and two wage orders, and it sought civil penalties.
Defendants filed their answer September 26, 2018. Defendants also
filed a notice of related cases, identifying five other PAGA actions brought by
different plaintiffs in state and federal court, three of which were pending.
One of the pending cases had been filed on April 26, 2018 by Appellants
Devonte Mitchem and Niki Phuong Ngo (collectively referred to as Mitchem
hereafter).
On December 28, 2018, the court stayed the Ali matter for 60 days so
that the parties could participate in mediation. In their February 21, 2019
joint case management statement, the parties indicated that a mediation
session was scheduled for March 26, 2019. On March 29, 2019, Ali filed an
amended notice letter with the Labor Workforce Development Agency
(LWDA).
The parties in the Ali matter filed a joint case management statement
April 25, 2019 in which they reported that they were in the process of

3
finalizing a settlement, which would be submitted for the court’s review and
approval in June 2019.
On June 6, 2019, the parties stipulated to allow Ali to file a first
amended complaint, which Ali filed June 11, 2019. The first amended
complaint named a number of Doe defendants and added Labor Code
violations. It was brought as a representative action under PAGA on behalf
of five groups of aggrieved current and former employees dating back to
February 20, 2017: current nonexempt employees, current nonexempt
employees paid on a commission-only basis, current employees who worked in
shifts of more than four hours or a fraction thereof and who were paid on a
commission draw basis and/or a commission only basis; current employees
who worked during pay periods in which the pay did not exceed one and a
half times minimum wage and/or employees who earned less than half their
compensation from commissions and worked overtime; and employees who
had been terminated or had resigned.
The parties filed a joint motion for approval of the representative
PAGA settlement on July 1, 2019. The motion explained the parties had
participated in an adversarial mediation process before an experienced
mediator whose services were necessary to reach a settlement. It detailed
the penalties they considered and discounted, explained that the settlement
was dependent on post-mediation discovery, which had been completed, and
it identified the risks of pursuing litigation in light of the strength of the
claims and the use of a separate entity defense, which had been recently used
successfully by the defendants in another case.
On August 22, 2019, Arnold Alix, a plaintiff in a different PAGA action
against the defendants, filed an ex parte application for an order shortening
time to hear his motion to intervene and to stay the action. In Alix’s

4
memorandum, he noted that he had filed a class action and PAGA
representative action on December 29, 2017 alleging similar violations.
On August 23, 2019, Mitchem filed an ex parte application to intervene
or, in the alternative, for an order shortening time to hear the motion to
intervene. In the memorandum of points and authorities, Mitchem argued he
had previously filed a PAGA action and was entitled to intervene as a matter

of right under Code of Civil Procedure1 section 387, subdivision (b) as an
aggrieved employee and designated proxy for the state, given that he had
filed suit April 26, 2018. Mitchem argued in the alternative that
discretionary intervention was proper.
Counsel for Mitchem explained he had discussed cooperating on the
pending litigation with Ali’s attorneys, but Ali’s attorneys did not follow up.
Mitchem had also scheduled mediation on a statewide basis for June 10, 2019
and stayed formal discovery pending that mediation. Auto Nation took the
mediation off calendar on May 7, 2019, after it filed the joint case
management statement indicating it was finalizing a PAGA settlement with
Ali. Auto Nation rescheduled mediation with Mitchem for October 28, 2019.
Mitchem learned of the proposed settlement on August 13, 2019 from Alix’s
attorney.
Concurrent with the motion to intervene, Mitchem filed objections to
the proposed PAGA settlement. The objections argued the proposed
settlement did not provide “ ‘genuine and meaningful relief’ ” because it
amounted to approximately $2.50 per pay period in exchange for a release of
claims, which Mitchem contended was not significant enough to deter
violations. Mitchem maintained that Ali focused on the value of claims for

1 Further unspecified section references are to the Code of Civil
Procedure.
5
commission-eligible employees but then reduced their value and did not
calculate a maximum value for all individually-identified claims being
released. He further contended that Ali’s legal representation was
inadequate because he did not analyze time or payroll records, did not
attribute any value to claims that were added to the first amended complaint,
and failed to consider the value of the separate entity defense.
The objections argued the settlement released claims dating back to
February 20, 2017, which was not a date corresponding to Ali’s initial PAGA
Notice, and the release was overly broad because it extended the tolling
period and released claims not raised in the original complaint. Finally, the
objections contended that the parties to the settlement had concealed the
negotiations while extinguishing claims raised by would-be intervenors and
asked the court to scrutinize the settlement as a potential reverse auction.
Ali opposed the requests to intervene on both factual and legal grounds.
Ali’s counsel reported proposing a joint prosecution to Mitchem’s counsel, and
he reported that Mitchem’s attorney failed to accept the offer, instead
scheduling separate mediation. Ali also argued Mitchem’s motion to
intervene lacked merit because it was untimely, and he had no personal or
individual interests in the PAGA action, and because Mitchem did not have
the right to object.
The court heard from the parties, and on August 28, 2019, it denied the
request for an order shortening time on the motions to intervene.
After hearing arguments about the proposed settlement, including ones
raised at the hearing by Mitchem, on September 20, 2019, the court took the
matter under submission.
On October 17, 2019, Mitchem filed a motion for leave to intervene in
the matter. The corresponding memorandum argued he was entitled to

6
intervene as a matter of right, and in the alternative, he met the
requirements for permissive intervention. Ali and the defendants opposed
the motion.
On October 24, 2019, the court granted the motion to approve the
PAGA settlement. In its order, the court noted that several nonparty
aggrieved employees filed objections to the settlement; it noted they were not
entitled to be heard, but it nonetheless considered their objections and found
them to lack merit. The court explained the settlement complied with Labor
Code requirements and was fair because it complied with the purpose of
PAGA to enforce labor laws and collect penalties on behalf of the state.
The court heard oral arguments on Mitchem’s motion to intervene on
November 8, 2019 and took the matter under submission before denying it
November 12. The court explained it had already considered the substance of
the nonparties’ objections and concluded they lacked merit. It also concluded
that Ali had adequately represented the state as its proxy under PAGA and
that Mitchem did not demonstrate entitlement to mandatory intervention or
meet the requirements for permissive intervention.
The court entered judgment approving the proposed PAGA settlement
and retaining jurisdiction over the action to effectuate and enforce its terms.
On December 20, 2019, Mitchem moved to set aside and vacate the
judgment. The court denied the motion.
On December 23, 2019, Mitchem appealed the order denying the ex
parte application for an order shortening time on the motion to intervene, the
order approving the PAGA settlement, the order denying the motion to
intervene, and the judgment.

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 Ali filed a motion to dismiss the appeal as moot, arguing the settlement
terms had already been satisfied and the funds had been distributed in
December 2019. Mitchem opposed the motion.
DISCUSSION
I
PRIVATE ATTORNEY GENERAL ACT (PAGA)
We begin with a brief discussion of the law. Before the Legislature
enacted PAGA, only the state could sue for civil penalties. (Kim v. Reins
International California, Inc. (2020) 9 Cal.5th 73, 80 (Kim).) Government
enforcement was problematic because prosecutors devoted their time to other
priorities. (Id. at p. 81.) So, in 2003, the Legislature enacted PAGA and
“declared that adequate financing of labor law enforcement was necessary to
achieve maximum compliance with state labor laws, that staffing levels for
labor law enforcement agencies had declined and were unlikely to keep pace
with the future growth of the labor market, and that it was therefore in the
public interest to allow aggrieved employees, acting as private attorneys
general, to recover civil penalties for Labor Code violations, with the
understanding that labor law enforcement agencies were to retain primacy
over private enforcement efforts.” (Arias v. Superior Court (2009) 46 Cal.4th
969, 980 (Arias).)
PAGA deputizes employees who have suffered a Labor Code violation
or violations of Industrial Welfare Commission (IWC) wage order provisions,
permitting them to bring a representative lawsuit on behalf of the state to
enforce labor laws. (Kim, supra, 9 Cal.5th at p. 81; Iskanian v. CLS
Transportation Los Angeles, LLC (2014) 59 Cal.4th 348, 386 (Iskanian).)
Although an aggrieved employee is the named plaintiff in a PAGA action,
PAGA disputes are between the state and the employer, not between the

8
employee and the employer. (Iskanian, at p. 386; Arias, supra, 46 Cal.4th at
p. 986 [plaintiff represents same legal rights and interests as state labor law
enforcement agencies].)
Before filing a PAGA lawsuit, an aggrieved employee must file a notice
with the LWDA and notify the employer of the specific violations and theories
to support the claims. (Labor Code, § 2699.3, subd. (a)(1)(A).) This gives the
LWDA the opportunity to investigate the alleged violations if it so chooses.
(Kim, supra, 9 Cal.5th at p. 81.) Once the procedural prerequisites are met,
the aggrieved employee can bring a PAGA action. (See Labor Code, § 2699.3,
subd. (a)(1); Caliber Bodyworks, Inc. v. Superior Court (2005) 134
Cal.App.4th 365, 375.)
If successful, the PAGA penalties are distributed with 75 percent to the
LWDA and 25 percent to the aggrieved employees. (Labor Code, § 2699,
subd. (i); Arias, supra, 46 Cal.4th at pp. 980-981.)
Overlapping PAGA actions may be brought by different employees who
allege the same violations and use the same theories. (Julian v. Glenair, Inc.
(2017) 17 Cal.App.5th 853, 866-867.) However, once the claims have been
resolved by any of the PAGA plaintiffs and judgment has been entered, the
government and all nonparty aggrieved employees are bound by the
judgment. (Ibid; see Iskanian, supra, 59 Cal.4th at p. 386 [aggrieved
employees bound by judgment in PAGA action]; Arias, supra, 46 Cal.4th at
p. 986.)
II
MOTIONS TO INTERVENE
We next turn to the orders denying Mitchem’s requests to intervene
because those are the foundation upon which the remaining challenges to the
judgment are built. Section 387 allows for either mandatory intervention,

9
governed by subdivision (d)(1), or permissive intervention, governed by
subdivision (d)(2). The appropriate standard of review for the denial of a
mandatory intervention is subject to dispute; several appellate courts have
implicitly applied the de novo standard of review, but at least one has
reviewed for abuse of discretion. (Siena Court Homeowners Assn. v. Green
Valley Corp. (2008) 164 Cal.App.4th 1416, 1425 (Siena Court).) We review
the denial of permissive intervention for an abuse of discretion. (Reliance
Insurance Co. v. Superior Court (2000) 84 Cal.App.4th 383, 386 (Reliance);
Truck Ins. Exchange v. Superior Court (1997) 60 Cal.App.4th 342, 345.)
Under this standard of review, we do not disturb the trial court’s exercise of
discretion unless it has led to a miscarriage of justice. (City and County of
San Francisco v. State of California (2005) 128 Cal.App.4th 1030, 1036 (City
and County of San Francisco).) The appellant bears the burden of
establishing that the court “exceed[ed] the bounds of reason, all of the
circumstances before it being considered.” (Id. at p. 1037)
A. Timeliness
Both mandatory and permissive intervention require a motion to
intervene to be made “upon timely application.” (§ 387, subds. (d)(1), (2);
Edwards v. Heartland Payment Systems, Inc. (2018) 29 Cal.App.5th 725, 736
(Edwards).)
Mitchem argues that the date for determining the timeliness is when
the third party knew or should have known his interests were not being
adequately represented, not when he first became aware of the competing or
overlapping suit. (Ziani Homeowners Assn. v. Brookfield Ziani LLC (2015)
243 Cal.App.4th 274, 281.) He contends his application was timely because
he did not know his interests were not being adequately represented until Ali
and the defendants filed their allegedly collusive joint motion to approve the

10
PAGA settlement because the PAGA settlement released a claim under a
code section not identified in Ali’s original PAGA notice and complaint. He
implies that he could not have known Ali would release those claims before
Ali filed the motion to approve the settlement.
The court did not make an express finding regarding timeliness.
Independent review leads us to conclude the motion was not timely under the
circumstances before the court, and the court’s denial was therefore proper
under either the de novo or abuse of discretion standards of review.
Mitchem acknowledges that he could have coordinated or collaborated
with Ali early in the case, when it was immediately clear from Ali’s original
complaint that Labor Code section 2802 was not included in the violations for
which Ali was seeking penalties. Mitchem’s attorneys also could have
assessed the scope of alleged violations during the discussions with Ali’s
attorneys about coordinating their actions. Mitchem implies that he did not
have an opportunity to consolidate or coordinate the actions because,
although his attorneys were agreeable to working with Ali’s attorneys and
never communicated an unwillingness to do so, Ali’s attorneys did not follow
up. But Mitchem does not go so far as to say that he offered to consolidate or
that his attorneys followed up with Ali’s to pursue coordinating the actions.
In other words, it appears that Mitchem’s attorneys did not inform Ali’s
attorneys that they were willing to cooperate on the PAGA litigation.
As a PAGA plaintiff himself, Mitchem knows that an aggrieved
employee can seek civil penalties for violations the employee does not
personally experience. (Kim, supra, 9 Cal.5th at p. 85.) Thus, Mitchem
should have known earlier than the parties’ request for approval of their
settlement that Ali’s activities could bind Mitchem even as to a Labor Code

11
violation not expressly listed in the initial complaint if Ali reached a
settlement agreement first and amended the complaint and PAGA notice.
If Mitchem were concerned that Ali would not represent his interests as
an aggrieved employee or member of the public after the initial
communication with Ali’s attorneys, he could have intervened at that point in
the litigation instead of more than a year later, only after settlement had
been reached. And the changed scope of Labor Code violations, as well as
how far back they were related, was evident in June 2019, when Ali filed a
first amended complaint.
Another reason Mitchem offers for the timing of his request to
intervene is his suggestion that Ali behaved secretly and collusively by
negotiating with the defendants without informing Mitchem of his plans.
But Mitchem cites no authority that requires parties to a PAGA action to
inform parties to related cases of their plans to negotiate a settlement. And
Mitchem similarly planned to negotiate with Auto Nation in mediation on a
statewide basis in his own, separate action. It appears that Mitchem’s failure
to intervene earlier was less about lack of information and more about

strategy.2
Mitchem’s request to intervene was not made upon timely application;
thus, the denial was proper. But even were the request timely, as we next
explain, the court did not err because Mitchem did not meet the other
requirements for either mandatory or permissive intervention.

2 The judgment awarded attorney fees to Ali’s attorneys in the amount of
$283,666.67. Had Mitchem reached statewide settlement with the
defendants, his attorneys would have been entitled to attorney fees. (See
Labor Code, § 2699, subd. (g).)
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 B. Mandatory Intervention
Section 387 subdivision (d)(1) provides that upon a timely application,
the trial court shall permit a nonparty to intervene if there is a legal
provision that confers an unconditional right to intervene or “[t]he person
seeking intervention claims an interest relating to the property or
transaction that is the subject of the action and that person is so situated
that the disposition of the action may impair or impede that person’s ability
to protect that interest, unless that person’s interest is adequately
represented by one or more of the existing parties.” (§ 387, subds. (d)(1)(A) &
(B).) In evaluating whether mandatory intervention applies, courts do not
consider whether intervention would expand the issues in the case, create
delay, or adversely affect the original parties. (California Physicians’
Service v. Superior Court (1980) 102 Cal.App.3d 91, 96.) “The threshold
question is whether the person seeking intervention has ‘an interest relating
to the property [or] transaction which is the subject of the action.’ ” (Siena
Court, supra, 164 Cal.App.4th at pp. 1423-1424.)
1. Interest Relating to Subject Property or Transaction
In a PAGA action, the employee acts as a proxy or agent for the state
labor law enforcement agencies and represents the legal rights and interest
of those agencies to benefit the public, not to benefit any private parties.
(Amalgamated Transit Union, Local 1756, CIO v. Superior Court (2009) 46
Cal.4th 993, 1003 (Amalgamated).) Thus, even though PAGA plaintiffs are
eligible to receive part of the recovery as compensation (Labor Code, § 2699,
subd. (i) [25 percent of recovered penalties distributed to aggrieved
employees]), the employee does not act as an agent for other employees

13
(Huff v. Securitas Security Services USA, Inc. (2018) 23 Cal.App.5th 745, 753
(Huff)), and PAGA “does not create any property rights or any other
substantive rights” (Amalgamated, at p. 1003).
Mitchem sought to intervene in the Ali matter as an aggrieved
employee, as a designated proxy in a different lawsuit, and as a named
plaintiff in a separate PAGA action. But none of these roles gives him the
right to intervene because the real party in interest in a PAGA action is the
state (Iskanian, supra, 59 Cal.4th at p. 380), and even though an aggrieved
employee can file suit on behalf of the government, doing so does not make
the employee a real party in interest (Amalgamated, supra, 46 Cal.4th at
p. 1003; Arias, supra, 46 Cal.4th at p. 986; Huff, supra, 23 Cal.App.5th at
p. 757).
Mitchem also contends he has an interest in the underlying litigation
because he has an interest in defendants’ employment practices, which
constitute transactions. And he argues that approval of the settlement would
impair those interests because it would preclude him from pursuing PAGA
claims on behalf of the state and other aggrieved employees. His position is
that as an overlapping or alternative proxy for state agencies, he is entitled
to intervene. But he does not detail why his interest in doing so supersedes
the interests of the proxy in the current matter, and he cites no law that
supports this position.
Because Ali was already acting as a proxy for the state and adequately

representing the state’s interests,3 Mitchem’s role as an alternative proxy for
the state or as a proxy in a different case does not demonstrate any direct
interest in the settlement, as that role is already filled by Ali. The state
could not intervene in the action because it was already a party.

3 We address the adequacy of Ali’s representation post.
14
 Mitchem next argues he has an interest in the transaction underlying
the litigation between Ali and Auto Nation because he has an interest in the
defendants’ employment practices. This interest derives from his roles as an
aggrieved employee and a member of the public, neither of which gives
Mitchem a specific interest in a PAGA matter. And Mitchem’s individual or
personal interest in enforcing those employment practices is not at stake in
the Ali matter because Mitchem’s personal claims are not impacted by a
PAGA settlement. (See Kim, supra, 9 Cal.5th at p. 87 [PAGA claims have no
individual component]; Amalgamated, supra, 46 Cal.4th at p. 1003 [PAGA
actions are not for benefit of private parties]; Lopez v. Friant & Associates,
LLC (2017) 15 Cal.App.5th 773, 780 (Lopez) [civil penalties under PAGA do
not include statutory damages recoverable by individual plaintiffs].) Because
the settlement did not reach the personal claims of nonparties and only
addressed the state’s enforcement of labor laws, Mitchem’s personal interests
were not impeded or impaired.
Finally, Mitchem contends that the court incorrectly considered
whether his rights outside of PAGA would be implicated rather than asking if
he would be prejudiced by his inability to seek penalties as a proxy under
PAGA. Mitchem cannot be prejudiced personally for being unable to collect
civil penalties because he has no personal right to them. (Amalgamated,
supra, 46 Cal.4th at p. 1003 [PAGA plaintiff stands in for the government to
collect the penalties on behalf of the state]; Huff, supra, 23 Cal.App.5th at
p. 757 [same].) The penalties distributed to a PAGA plaintiff are offered to
incentivize the employee bringing a suit (id. at p. 760), not to create any right
personal employee to recovery. And because the state’s interests were
represented, he was not prejudiced as a proxy.

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 2. Adequacy of Representation
In addition to failing to demonstrate any interest relating to the
underlying transactions beyond the potentially duplicative or overlapping
role as a state proxy, Mitchem failed to demonstrate Ali inadequately
represented the interests of the state in pursuing the penalties.
“ ‘[W]here an applicant for intervention and an existing party “have the
same ultimate objective, a presumption of adequacy of representation
arises.” ’ [Citation.]” (League of United Latin Am. Citizens v. Wilson (9th Cir.

1997) 131 F.3d 1297, 1305.)4 When a proposed intervenor disagrees with
litigation strategy or legal tactics, and not with any substance, courts are
reluctant to give the intervenor equal status. (League of United Latin Am.
Citizens, at p. 1306.) Thus, the question is not whether Mitchem would do a
better job than Ali in representing the interests of the state; the statute
requires only adequate representation. (§ 387, subd. (d)(1)(B).)
As we have noted, because Mitchem and Ali each represent the interest
of the state labor agencies to ensure compliance with labor law, their
interests are identical. Mitchem claims that were he permitted to intervene,
he would retain an expert to review payroll and timekeeping records to assess
the underlying claims’ value, consistent with how class actions have been

handled, and that this would lead to a higher settlement amount.5 But he

4 Federal Rule of Civil Procedure 24 is the substantive counterpart to
California’s intervention rule, and California takes guidance from federal law
in assessing the requirements of intervention. (Edwards, supra, 29
Cal.App.5th at pp. 730, 732).

5 Mitchem cites two federal district court cases to argue that Ali was
inadequate because “a statistically significant sampling of time and payroll
records” along with the “analysis of those records. . . . is necessary ‘to
prosecute this action, which seeks to enforce California’s labor laws.’ (Hill v.
16
provides no authority that a PAGA plaintiff must follow class action
strategies and approaches to adequately represent the state’s interests or
that this is an appropriate comparison for determining adequacy of
representation. These contentions do not demonstrate inadequate
representation. Aside from this, Mitchem does not point to any conduct that
demonstrates that Ali’s representation was not adequate.
Mitchem appears to argue that Ali’s representation was inadequate
because the settlement was unfair. But as we detail post, the court did not
abuse its discretion in approving the settlement, which was genuine and
meaningful, and consistent with the goal of benefitting the public by
enforcing labor laws. (See O’Connor v. Uber Techs., Inc. (N.D.Cal. 2016)
201 F.Supp.3d 1110, 1133 (O’Connor).)
C. Permissive Intervention
Mitchem does not fare better in his bid for permissive intervention.
Permissive intervention is available when a would-be intervenor meets four
criteria: “(1) the proper procedures have been followed; (2) the nonparty has
a direct and immediate interest in the action; (3) the intervention will not

Eddie Bauer (C.D.Cal. [2007]) 242 F.R.D. 556, 563.)” The Minnesota district
court case, UnitedHealth Group v. Columbia Casualty Company (D. Minn.
2010) 2010 WL 11537514, at p.*25, does not state that such a sampling is
required; it says that one way to demonstrate a class action settlement’s
reasonableness is through such a sampling. And in Hill, the court was
addressing a motion to compel discovery of 51 requests for production of
documents. (Hill, at pp. 559-560.) The district court compelled documents
pertaining to hours, wages, business-related expenses, repayment of wages to
employer, termination of wages, meal breaks and rest breaks because they
were necessary for class certification as well as to enforce the labor laws. (Id.
at p. 563.) Although Mitchem implies this means time and payroll records
are always necessary to pursue civil penalties, the court did not so hold. It
simply concluded those documents were necessary for one or both purposes
for which that particular lawsuit was brought. (See id. at p. 563.)
17
enlarge the issues of the litigation; and (4) the reasons for the intervention
outweigh any opposition by the parties presently in the action.” (Reliance,
supra, 84 Cal.App.4th at p. 386.) “The permissive intervention statute
balances the interests of others who will be affected by the judgment against
the interests of the original parties in pursuing their litigation unburdened
by others.” (City and County of San Francisco, supra, 128 Cal.App.4th at
p. 1036.)
1. Proper Procedures & Interest in the Action
Setting aside the issue of timeliness, which we addressed ante, the
parties do not dispute that Mitchem complied with the remaining procedural
requirements for permissive intervention. The court concluded, however,
that Mitchem had no direct and immediate interest in this action and lacked
standing as a representative of the state, presumably because the state’s
interests were already represented by Ali. And the trial court noted that
Mitchem did not have any substantive rights under PAGA as an aggrieved
employee. We agree.
As we have explained, only the state holds an interest in the
enforcement of penalties under PAGA; aggrieved employees have no
individual substantive or property rights in a PAGA action. (Amalgamated,
supra, 46 Cal.4th at p. 1003 [PAGA is purely procedural].) While a PAGA
judgment may result in financial benefit to employees who receive a portion
of the recovery in a PAGA action (Labor Code, § 2699, subd. (i) [25 percent of
recovery is paid to aggrieved employees]), this is a result of enforcing the law,
not a direct benefit to private parties. (See Arias, supra, 46 Cal.4th at
p. 986.) Mitchem argues that there is an immediate interest here because
approving the PAGA settlement would prevent him from pursuing the same
claims on behalf of the aggrieved employees under the doctrine of res

18
judicata. Although the judgment here binds the state on behalf of the
aggrieved employees (Arias, at p. 986 [judgment under PAGA binds employee
and state labor law enforcement agencies]; Iskanian, supra, 59 Cal.4th at
p. 381 [a nonparty represented by the agency is bound by the judgment]),
employees’ interests are already represented in this action by the state’s
proxy, Ali. Thus, Mitchem fails to meet this element of permissive
intervention.
2. Enlarged Issues and Reasons for Intervention as Compared to Opposition
None of the parties addresses the third element in any detail. The
defendants claim that if the intervention results in undoing the settlement,
that would be an enlargement of the issues. But we fail to see how an
intervention for the purpose of challenging the fairness of a PAGA settlement
agreement before the trial court, which has a gatekeeping function of
approving the settlement, enlarges the issues. This already exists as part of
the court’s tasks.
The court concluded that Mitchem did not meet the fourth element,
whether Mitchem’s desire to protect the state’s rights outweighed the
opposition of the parties already involved in the action. Because Mitchem
and Ali represented the same interests, the state’s interests in enforcing
labor laws, Mitchem’s desire to be the individual responsible for protecting
those rights does not outweigh the opposition raised by those already tasked
with doing so. Given the work the parties had already put into mediating the
settlement and the adversarial nature of the settlement negotiations, the
court’s conclusion on this point was not arbitrary or capricious. (See City and
County of San Francisco, supra, 128 Cal.App.4th at p. 1036.) Accordingly,
even without considering timeliness, the court did not abuse its discretion in
denying the request to intervene under the permissive intervention statute.

19
 Finally, even had the court improperly denied Mitchem’s request to
intervene, because it considered the substance of his objections before
approving the settlement, neither Mitchem nor the state as the real party in
interest was harmed by the court denying his requests to intervene.
III
SETTLEMENT FAIRNESS
A. Standing
The parties to this appeal do not dispute that Mitchem had standing to
challenge the denial of his requests to intervene. And Mitchem acknowledges
that no California Court of Appeal has determined who has standing to
appeal a PAGA settlement. But he argues we should consider him an
aggrieved party for purposes of section 902 because he meets the definition of
“aggrieved employee.”
Labor Code section 2699, subdivision (a) provides that any “aggrieved
employee” has standing to pursue a PAGA action as a proxy for the state. It
is a term of art used in the PAGA statute to describe “any person who was
employed by the alleged violator and against whom one or more of the alleged
violations was committed.” (Labor Code, § 2699, subd. (c); Kim, supra,
9 Cal.5th at p. 87.) Mitchem contends that in Kim the Supreme Court “put to
rest” “[t]he issue of whether an employee has standing to challenge a PAGA
settlement.” But Kim does not hold that any aggrieved employee can
challenge a PAGA settlement; it holds that an employee does not lose
standing as a PAGA plaintiff after settling individual claims. (Kim, at p. 93.)
Neither Kim nor the PAGA statute addresses whether an aggrieved employee
has the right to challenge the fairness of a PAGA settlement on appeal.
Under section 902, any “party aggrieved” may appeal a judgment, and
in the context of this statute, “ ‘one who is denied the right to intervene in an

20
action ordinarily may not appeal from a judgment subsequently entered in
the case. [Citations.] Instead, he may appeal from the order denying
intervention.’ [Citation.]” (Hernandez v. Restoration Hardware, Inc. (2018) 4
Cal.5th 260, 263.) Hernandez held that unnamed class members could not
appeal a class judgment, settlement, or attorney fees award unless they had
intervened in the action, (ibid) but it did not address PAGA. Although
Mitchem appears to be an “aggrieved employee,” it is not clear that he is an
“aggrieved party” with respect to judgment.
We decline to wade into this issue because, even assuming Mitchem
has standing to challenge the PAGA settlement as a third party non-
intervenor member of the public, we conclude the court did not abuse its
discretion approving it.
B. Mootness
Ali and Auto Nation each contend this appeal is moot because there is
no actual or legal remedy available, as the funds have been distributed to
thousands of individuals and the real party in interest, the state, accepted

the benefits of the settlement.6

6 Mitchem submitted four requests for judicial notice: Request for
Judicial Notice in support of the appeal, filed October 26, 2000 (RJN 1);
Supplemental Request for Judicial Notice in Support of Appeal, filed
November 6, 2000 (SRJN); Request for Judicial Notice in Opposition to
Motion to Dismiss, filed November 6, 2000 (RJN 2), and Second
Supplemental Request for Judicial Notice in Support of Appeal, filed April 23,
2021 (SSRJN). RJN 2 and SRJN ask us to take judicial notice of four
documents related to the depublication of Starks v. Vortex Industries, Inc.
(2020) 53 Cal.App.5th 1113, depublication granted (2020) 2020
Cal.Lexis 8676, and those parties’ requests for review by the Supreme Court.
The fifth exhibit attached to SRJN is a declaration from a representative of
the entity that managed the settlement funds in the Ali matter. It details the
postsettlement distribution of funds and confirms the number of aggrieved
employees who were issued settlement checks. The fifth item listed in RJN 2
21
 We question whether the LWDA’s acceptance of its share of the
judgment proceeds is sufficient to moot the appeal in light of Mitchem’s
challenge to the court’s ruling on intervention and request to vacate the
judgment approving the settlement. We note that the real party in interest,
the LWDA, agreed to the terms of the settlement before depositing or
distributing the judgment funds, and the challenge here is by a party
claiming the same rights and status as the LWDA. But we also recognize the
formal requirement that administrative agencies deposit funds within five
working days of receipt (Cal. Dept. of General Services, State Admin. Manual
(2015) § 8032.1 [accumulated money will not remain undeposited for more
than five working days]), and that a party does not lose its right to appeal a
judgment through conduct arising under compulsion or risk of forfeiture
(Lee v. Brown (1976) 18 Cal.3d 110, 116). And we find Mitchem’s argument
that parties to a settlement could always avoid appellate review by
disbursing funds before the appellate court could review the challenges
thereto persuasive, particularly where, as here, the settlement agreement
required distribution of funds before the period of time to appeal lapsed.
Because the challenge to the settlement’s fairness here is so tightly tied to
the denial of the right to intervene, we treat Mitchem as having standing to
appeal both the intervention and, consequently, the court’s approval of the

is the alleged number of PAGA notices filed in the year 2019 and between
January 1, 2020 and October 31, 2020. We do not rely on Starks in reaching
our decision, and we deny RJN 2 and SRJN as irrelevant or unnecessary to
our ultimate conclusions. (Deveny v. Entropin, Inc. (2006) 139 Cal.App.4th
408, 418 (Deveny) [“[A] litigant must demonstrate that the matter as to which
judicial notice is sought is both relevant to and helpful toward resolving the
matters before this court”].) Mitchem’s SSRJN, which seeks notice of
documents and briefs filed by individuals and entities in other cases to show
“that this appeal is not moot” and to detail the positions taken in other cases
addressing similar issues, is denied for the same reasons. (See ibid.)
22
settlement he sought to challenge through that intervention. We decline to
dismiss the matter as moot, instead affirming the court’s judgment, as we
next discuss.
C. Settlement Fairness
Labor Code section 2699, subdivision (l)(2) requires the trial court to
review and approve a PAGA settlement, and the Supreme Court has
commented that in doing so, the court “ensur[es] that any negotiated
resolution is fair to those affected.” (Williams v. Superior Court (2017) 3
Cal.5th 531, 549.) There is no published California authority that has
identified the standard a trial court should employ in evaluating PAGA
settlements. (See Flores v. Starwood Hotels & Resorts Worldwide (C.D.Cal.
2017) 253 F.Supp.3d 1074, 1075 (Flores).) The federal district court in
O’Connor considered whether the relief provided by a PAGA settlement’s
terms is “genuine and meaningful, consistent with the underlying purpose of

the [PAGA] statute to benefit the public.”7 (O’Connor, supra, 201 F.Supp.3d
at p. 1133.) There is also no authority stating the appellate standard of
review for evaluating the approval of a PAGA settlement.
Although the purposes of and requirements for reviewing class action
and PAGA settlements differ, as we explain more fully post, we will review
the trial court’s approval of the PAGA settlement and corresponding entry of

7 Among other things, Mitchem proposes a standard that requires the
court to “weigh the full monetary value of relevant penalties” in evaluating a
PAGA settlement. The proposed standard is taken from an amicus brief filed
by the Labor Commissioner in Price v. Uber Technologies, Inc. (L.A. Sup. Ct.,
No. BC554512), which Mitchem asks us to take judicial notice of in RJN 1.
We decline because the brief was filed in an unrelated matter and would not
be helpful to our decision here. (See Deveny, supra, 139 Cal.App.4th at
p. 418.) The proposed requirement has not been adopted by the Legislature
or any published case law.
23
judgment here for an abuse of discretion. We apply this standard because the
statute does not detail specific requirements for a trial court’s review, leaving
the court to exercise its judgment and discretion to assess whether the
settlement achieves the goals of PAGA (see Fasuyi v. Permatex, Inc. (2008)
167 Cal.App.4th 681, 695 [explaining this standard is based on an impartial
discretion guided by fixed legal principles]; Huff, supra, 23 Cal.App.5th at
p. 756 [PAGA goal is to enforce labor laws]), and because the task at hand
asks us to consider the propriety of that discretionary decision.
In the class action context, trial courts consider whether a settlement is
fair, adequate, and reasonable. (Cellphone Termination Fee Cases (2009) 180
Cal.App.4th 1110, 1118.) They consider the substance of the proposed
settlement to avoid fraud, collusion, or unfairness to the class. (Id. at
p. 1117.) Trial courts have broad discretion, and their determination is
reviewed for abuse of discretion. (Id. at p. 1118.) “ ‘To merit reversal, both
an abuse of discretion by the trial court must be “clear” and the
demonstration of it on appeal must be “strong.” ’ ” (Cho v. Seagate
Technology Holdings, Inc. (2009) 177 Cal.App.4th 734, 743.)
However, the court’s gatekeeping function in the class action context
differs from its role in reviewing PAGA cases. In class actions, courts have a
fiduciary duty to protect the interests of absent class members, whose
individual claims for wrongfulness will be discharged. (Kullar v. Foot Locker
Retail, Inc. (2008) 168 Cal.App.4th 116, 129 [court acts as guardian of rights
of absentee class members].) In this role, courts conduct an “independent
assessment of the adequacy of the settlement terms,” which requires them to
have sufficient data and information about the amount in controversy and
the realistic range of outcomes. (Id. at p. 132.) Courts consider a variety of
factors in conducting this analysis, including whether the settlement is

24
negotiated at an arm’s length, whether there is sufficient discovery and
information to permit parties and the court to act intelligently, whether the
attorneys have experience with the type of issues, and whether the number of
objectors is small. (Dunk v. Ford Motor Co. (1996) 48 Cal.App.4th 1794,
1800-1801.)
But a PAGA representative action is “not akin to a class action”; it “is a
species of qui tam action.” (Flores, supra, 253 F.Supp.3d at p. 1076.) When
reviewing a PAGA-only settlement, courts do not consider the value of
individuals’ claims for damages because a PAGA settlement does not release
those claims. (Kim, supra, 9 Cal.5th at p. 87 [PAGA claims have no
individual component]; ZB, N.A. v. Superior Court (2019) 8 Cal.5th 175, 197-
198 [PAGA damages limited to civil penalties].) “The state’s interest in such
an action is to enforce its laws, not to recover damages on behalf of a
particular individual.” (Huff, supra, 23 Cal.App.5th at p. 760.) Instead of
focusing on fair recovery for individual claims, the goal of PAGA enforcement
is to achieve “maximum compliance with state labor laws.” (Huff, at p. 756.)
To the extent that a court is tasked with evaluating whether the PAGA
settlement is genuine and meaningful, there are no specific factors the court
must use.
Mitchem identifies three alleged deficiencies in the settlement, which
he contends demonstrate the agreement is not genuine and meaningful,
consistent with the underlying purposes of PAGA. We address each in turn.
1. Sufficiency of Available Information
Mitchem contends that the trial court did not have sufficient
information from which it could evaluate the quality of the settlement.
Although there is no published authority that requires independent

25
evaluation of the fairness of a PAGA settlement to the parties affected,8 the
parties to the Ali matter provided the trial court with sufficient information
for it to conclude that the settlement was genuine and meaningful.
Prior to mediation, the defendants provided Ali with the number of
nonexempt employees and the number of pay periods for commissioned and
noncommissioned employees, as well as itemized wage statements and
employment policies. This information was a starting point to evaluate the
possible penalties, which are based on pay period and class of aggrieved
employees. (Labor Code, § 2699, subd. (f).)
The parties participated in an adversarial mediation that required the
guidance of an experienced mediator to reach agreement. During mediation,
they considered penalties covering a possible 200,935 pay periods during the
relevant time period. They focused on the value of claims for the commission-

8 Mitchem points to O’Connor to argue the trial court erred because it
did not weigh the full monetary value of the relevant penalties to determine
if the proposed penalties would effectively minimize any economic advantage
to the employer. Although we will conclude the court had sufficient
information to draw conclusions about the recovery deterring labor law
violations, we separately note here that in O’Connor the court was not tasked
with simply considering the likely impact of the PAGA penalties on employer
behavior because the parties there negotiated a class settlement as well. The
court’s concern in O’Connor was that there could be “temptation to include a
PAGA claim in a lawsuit to be used merely as a bargaining chip,” so that the
rights of nonclass members could be essentially “waived for little additional
consideration in order to induce the employer to agree to a settlement with
the class.” (O’Conner, supra, 201 F.Supp.3d at p. 1134.) Notably, the LWDA
opposed the PAGA settlement there, arguing that there was no rational basis
for the PAGA settlement amount, which was set at 0.1 percent of the
potential verdict value. (Id. at p. 1135.) The court concluded the parties had
“treat[ed] the PAGA claim simply as a bargaining chip,” even though it was
worth more than half the full verdict value. (Ibid.)
26
eligible employees and calculated it, without stacking penalties,9 to equal
$1,186,200. They focused on this group of aggrieved employees because they
agreed that defendants would likely have prevailed on the noncommissioned
employee claims during the pay periods at issue based on a review of the
documentation, which indicated the defendants had complied with the law.
This resulted in dismissing from penalty consideration claims for 6,500
noncommissioned employees, though they were included in the complaint as
aggrieved employees. The parties thus considered the total number of pay
periods likely to show liability was 5,931. At $100 per pay period, the
maximum value of the claims was between $593,100 (for the 5,931 identified
employees) and $1,186,200 (for all commission-eligible employees, without
regard to likely liability). After accounting for the likely number of pay
periods in which violations occurred and negotiating at an arm’s length, the
parties agreed on a net PAGA penalty payment totaling $519,800.62,
primarily relying on the claims of identified employees. This also took into
consideration the discretionary nature of the civil penalties and the fact that
defendants had changed their commission payment plans shortly before Ali

9 “Stacking” penalties occurs when a civil penalty is recovered for each
violation within a single pay period. Ali’s attorney noted that no appellate
court had ruled on the issuing of stacking and argued to the trial court that
the availability of stacking, particularly in a PAGA settlement, is unclear
because Labor Code section 2699, subdivision (f) references “a” penalty for “a”
violation, while subdivision (g) references “the” civil penalty on behalf of
employees against whom “one or more of the alleged violations.”

27
sent the LWDA a PAGA notice, reducing possible liability for that group.10
The settlement provided for one credit for each period worked for all
aggrieved employees plus four pay period credits for those who were
commission-only employees, based on the comparative strength of those
claims, demonstrating the parties evaluated the strengths and weaknesses of
claims. And the mediated settlement agreement was subject to confirmatory
discovery, which the parties completed before seeking approval.
The parties also presented to the court information about the potential
strengths and weaknesses of the PAGA civil penalties claims by explaining
the risk factors that could preclude any recovery of penalties, including a
separate entity defense, which defendants had successfully litigated to
summary judgment in another case. They noted the complexities, expenses,
and duration of continued litigation and provided the court with their
analysis and reasoning. Given the information provided to the court, we
cannot say it lacked sufficient information to draw its conclusion, thereby
abusing its discretion.
2. Scope of Release
Mitchem next contends the scope of the release was unduly broad, so it
was improper for the court to approve its terms. Mitchem’s contention is
based on two concerns he raised in his objections, and which the trial court
considered before reaching its conclusion. First, he argues the release
impermissibly extended beyond the time period for which Ali was authorized
by the state to seek PAGA penalties because it covered violations dating back

10 RJN 1 is denied. The first two items are documents in the record, so
granting judicial notice would be duplicative and unnecessary. The fifth
through seventh items are documents from Mitchem’s suit against the
defendants and are not helpful to our resolution of the issues before us. (See
Deveny, supra, 139 Cal.App.4th at p. 418.)
28
to February 20, 2017 when the PAGA notice only allowed for Ali to make
claims dating back to May 25, 2017. Second, Mitchem contends the release is
overbroad because it includes predicate Labor Code violations not included in
the original PAGA notice or the original complaint.
A PAGA notice is required to provide reasonably detailed facts and
theories and to identify aggrieved employees, but plaintiffs are not expected
to know every potential fact, future theory, or even group of aggrieved
employees at the time they file this notice; this information will become more

complete through discovery.11 (Cardenas v. McLane Foodservices, Inc.
(C.D.Cal. 2011) 796 F.Supp.2d 1246, 1261.) The reason for including the
information in the PAGA notice is so that the LWDA has a sufficient basis to
investigate the aggrieved employees’ allegations. (Kim, supra, 9 Cal.5th at
p. 81.) Regardless, the administrative requirements were met here by virtue
of Ali’s amendment to his PAGA claim notice and submission of the first
amended complaint, which addresses both the timing and scope of violations
that Mitchem questions.
Additionally, statute of limitations and administrative exhaustion
requirements are affirmative defenses subject to forfeiture or waiver by a
defendant. (See Moor v. City of Los Angeles (2007) 156 Cal.App.4th 373, 382-
383 [statute of limitations defense is waived if not timely asserted]; Kim v.
Konad USA Distribution, Inc. (2014) 226 Cal.App.4th 1336, 1347-1348
[waiver of failure to exhaust administrative remedies]; People ex rel.
DuFauchard v. U.S. Financial Management, Inc. (2009) 169 Cal.App.4th
1502, 1512 [exhaustion requirements not raised in trial court deemed

11 We deny Ali’s request for judicial notice, raised in footnote 2 of his
respondent’s brief, citing to the Department of Industrial Relation’s PAGA
webpage, which includes instructions for supplementing a PAGA notice.
29
forfeited on appeal].) And there is no prohibition on extending the release
period to cover concurrent claims. (See Edwards, supra, 29 Cal.App.5th at
p. 730 [denying intervention when PAGA suit was amended to extend time to
cover concurrent claims].) Here, defendants agreed to the terms of
settlement, and the LWDA received notice and did not seek to object or

otherwise comment regarding the concerns raised here.12
Mitchem contends the added claims must be closely scrutinized to
verify adequate representation of affected employees. But this argument
misses the mark; no employees’ rights are affected because they do not
release their personal employment claims in a PAGA settlement agreement.
(Kim, supra, 9 Cal.5th at p. 87 [no individual component to PAGA]; Lopez,
supra, 15 Cal.App.5th at p. 780 [PAGA penalties do not include individual
plaintiffs’ damages].)
Finally, Mitchem implies that the parties did not adequately explore
and evaluate the additional predicate violations, suggesting that Ali was not
sufficiently adversarial in representing the state on these additional claims.
But Mitchem offers no evidence that shows Ali inadequately represented
those specific claims, and the evidence indicates the negotiations were
adversarial. The court did not abuse its discretion in approving the
settlement based on the scope of the release or the time period it covers.
3. Reverse Auction
Although Mitchem accuses the defendants of secretly negotiating their
settlement without first notifying Mitchem of their plans, he provides no
evidentiary basis for his claim that this settlement should be viewed as a

12 Mitchem’s reply brief argument that he has standing to assert this
defense is not persuasive because Mitchem’s proxy standing in a different
matter is not co-equal with Ali’s proxy standing in this case, as we have
discussed ante.
30
reverse auction. Mitchem also argues that Auto Nation’s act of rescheduling
its mediation with Mitchem for a date after the hearing on the settlement
approval lacked candor and is evidence of reverse auction. But Mitchem was
aware of the pending litigation between Ali and the defendants and opted not
to seek consolidation or coordination of the actions. And Mitchem, like Ali,
prepared to enter into a statewide litigation with the defendants, presumably
without informing Ali of his plans. This does not make the activity collusion.
Further, the record does not reflect clandestine activities by the parties
to the settlement. In their February 21, 2019 joint case management
statement, the parties indicated they were planning a mediation session on
March 26. The following month, April 25, 2019, their joint case management
statement reported they were finalizing a settlement and anticipated
submittal of it for court approval in June. This occurred before Auto Nation
took the June 10 mediation in the Mitchem action off calendar. The fact of
their mediation was public record, as was their intention to settle. Their first
amended complaint, filed June 11, 2019, added defendants and Labor Code
violations and set the date back to February 20, 2017, which made it clear
that the claims being settled subsumed those in other, related PAGA actions
like Mitchem’s. Then the following month, the parties filed a joint motion for
approval on July 1. Mitchem did not ask to intervene until August 23, 2019,
more than four months after the parties indicated they had reached a
tentative settlement agreement. The parties did not act in secret or conceal
the settlement; they simply did not give notice to Mitchem.

31
 DISPOSITION
The judgment is affirmed. Parties to bear their own costs on appeal.

HUFFMAN, Acting P. J.

WE CONCUR:

O'ROURKE, J.

IRION, J.

32