California Supreme Court Determines PAGA Cases May Not be Dismissed Due to Issues of Manageability

Long-time blog readers and CEN watchers will recall that for the last several years, we have been watching several cases discussing whether Private Attorneys General Act (“PAGA”) claims may be stricken as unmanageable. First, in the Fall of 2021, an appellate court determined that trial courts have inherent authority to strike or limit PAGA claims that could not otherwise be made manageable in order to “preserve judicial resources [and to] prevent trials from becoming excessively complex and time-consuming.” (See Wesson v. Staples the Office Superstore, LLC (2021) 68 Cal.App.5th 746).  Just a few months later, a different appellate court disagreed, concluding that while a court may limit the presentation of evidence to ensure a manageable trial, courts had no authority to strike or limit PAGA claims due to unmanageability. (See Estrada v. Royalty Carpet Mills, Inc. (2022) 76 Cal. App. 5th 685.)

The California Supreme Court has now weighed in, and not in the way many employers had hoped. On January 18, 2024, the California Supreme Court issued its decision in Estrada v. Royalty Carpet Mills, concluding that Private Attorneys General Act (“PAGA”) claims may not be stricken as unmanageable. The court noted that California case law does not routinely permit trial courts to dismiss or narrow claims, except under limited circumstances, none of which are inherently found within PAGA claims. 

This is not to say there are no silver linings. The Court was careful to note that while trial courts do not have the authority to dismiss cases for being unmanageable, trial courts have other options available where appropriate. First, the Court explored the possibility that a PAGA claim might be stricken to protect a defendant’s due process rights under certain circumstances. The Court also explored numerous other case management tools available to that parties in order to ensure that PAGA cases are tried “efficiently, fairly, and effectively.” The Court specifically considered the following “case management” tools available to parties:

  • The use of “[r]epresentative testimony, surveys, and statistical analysis” to aid in the presentation of evidence;
  • The limitation of witness testimony and evidence a plaintiff may present to a jury;
  • The limitation the scope of the PAGA claims where appropriate; and
  • The use of substantive and dispositive rulings where it is determined a plaintiff is unable to meet their burden of proof.

To be sure, this decision is not the decision California employers hoped for. It is important that California employers consult with legal counsel when facing a PAGA claim to best determine whether there are grounds by which to seek its dismissal, including a constitutional basis worth attacking.