This newsletter summarizes two recent court cases: 1) The Ninth Circuit affirmed class certification in a gender discrimination case against Walmart brought by 1.5 million current and former female employees. 2) A California appellate court ruled that an in-house counsel for a company could be relieved of a $4 million default judgment against the company under a provision allowing relief for attorney mistake or neglect.

1. newsletter
May 2010 By Anthony J. Oncidi
Vol. 9, No. 3
Anthony J. Oncidi Ninth Circuit Affirms Certification Of Class In Wal-Mart Gender
is a partner in and the Discrimination Case
Chair of the Labor and
Employment Dukes v. Wal-Mart Stores, 2010 WL 1644259 (9th Cir. 2010) (en banc)
Department of The district court certified a class encompassing all women employed by Wal-Mart at any time
Proskauer Rose LLP in after December 26, 1998 who claimed gender discrimination under Title VII and who sought
Los Angeles, where he injunctive and declaratory relief, back pay and, in a separate opt-out class, punitive damages.
exclusively represents Among other things, plaintiffs claim they received lower pay and fewer and slower promotions
employers and than did their male counterparts. In this en banc decision, the Ninth Circuit affirmed the
management in all district court in a narrow 6-5 ruling. The class includes as many as 1.5 million women who
areas of employment worked at over 3,400 stores throughout the United States. The Court affirmed certification
and labor law. His under Fed. R. Civ. P. 23(b)(2), which imposes less stringent requirements for class
telephone number is certification and applies to cases in which the injunctive relief sought predominates over the
310.284.5690 and his monetary relief sought. See also Porter v. Winter, 2010 WL 1780864 (9th Cir. 2010) (federal
e-mail address is c ut h v s b c matrui ii o e c i bo g t o lt rc v r t re ’fe
o r a e u j t t j s co v r lms ru h s ly o e o e at n y e s
s e e rd tn a e o s
aoncidi@proskauer.com incurred in Title VII administrative proceedings); United Steel, Paper & Forestry, etc. v. Shell
Oil Co., 2010 WL 1571190 (9th Cir. 2010) (denial of Rule 23 class certification in removed
action does not divest district court of jurisdiction).
Company Whose General Counsel Was Responsible For
$4 Million Default Judgment Was Relieved Under CCP § 473
Gutierrez v. G&M Oil Co., 2010 WL 1818904 (Cal. Ct. App. 2010)
Maria Gutierrez filed a wage-and-hour class action lawsuit against G&M Oil Company, an
o eao o ac a o g s tt n tru h u C l ri Mi a l ry a G M’v e
p rtr f h i f a s i s ho g o t af n . c e G a w s & s i
n ao i a
o h c
president and general counsel and its registered agent for service of process. Gray agreed to
a c p s ri o tec mp i f m G t r z atre a dd c e t h n l ted fn e
ce t ev e fh o ln r
c a t o ui r ’ t n y n e i d o a d h ee s
ees o d e
of the case himself. Gray did not send a copy of the pleadings to anyone else at G&M and
kept the existence of the lawsuit to himself. Over the course of the next 12 months, there
were no fewer than three separate requests for default, based on a lack of response to the
operative complaint. Finally, a default judgment of $4 million was obtained against G&M.
After Gray was removed from his position and outside counsel was retained to defend G&M,
the company filed a motion to vacate the default judgment, relying upon Code Civ. Proc. §
4 3( lv gap r f m ad fu b s du o a atre ’“ s k , a v r n e
7 ri i
ee n at r
yo ea l a e p n n t n y mia e i d et c ,
t o s t n e
s rr eo n g c ) T eta c ut rne G M’moi t v c t ted fu , o i ta
upi r e l t. h r lo rga td & s t n o a ae h ea l h ln h t
s e” i o t dg
Section 473 applies to in-house counsel such as Gray as well as outside counsel. The Court
o A p a afme e e to g G a w s o o lG M’g n rlo n e b t l o eo i
f p e lf i d v n h u h ry a n t n & s e ea c u s l u a o n f s
r y s t
corporate officers.

2. Start-Up Company Owned Source Code That Was Developed
By Employee
JustMed, Inc. v. Byce, 600 F.3d 1118 (9th Cir. 2010)
Michael Byce developed the source code used in the software of a digital audio larynx device
that JustMed owned. JustMed contended that Byce was its employee when he developed the
code and that the code, therefore, belonged to JustMed under the work-for-hire doctrine of the
federal Copyright Act. Byce, however, contended he was an independent contractor and that
he expected to receive shares in JustMed upon transferring ownership of the source code to
JustMed. The district court found that Byce was an employee of JustMed when he wrote the
software and that JustMed owned the copyright to the software under the work-for-hire
d c i .T ed tc c ut l fu dB c lb fr s p rpi i o J s d t d
o tnr e h ir t o ra o o n ye i l o mi po r t n f u t ’ r e
si s ae a ao Me s a
s ces T eNnhCru afme ted tc c ut j g n rg ri v l i o te
e rt h i
. t i ifc t i d h ir t o rsu me te ad g ia o fh
r si ’ d n o tn
C p r h A tn t gta a h u h“u t d[s s ru c mp n ] i n t o lwt
o yi t c oi h t l o g J s
g , n t Me a a t t p o a y d o c mp i
a- d y h
fd rl n s t e l me t ra l s terme y o te efi g ls o wt d n i
e ea a d t e mp y n o txa … h e d frh s ai si n t i e y g
a o w ln e h n
tefm i i ee ta po et b t i e fri terl a t w . H w v rteC ut
h i t n lc l rp r u wt noc g h e v n l s o e e,h o r
r s tl u y h n e a ”
rv re tej g n i oa a ted tc c ut a d tr n dB c h dv l e Ia o
e es d h u me t s fr s h ir t o rh d eemi
d n si e ye a ia d d h ’
ot s
v ri o teU i r Ta eS ces c b c u eB c h dn i e “s d n rd c s d
es n fh n om rd e rt A t e a s ye a e h ru e ” o “i l e ”
o f t so
J s d t d s ces T eNnhCru rma d dtec s frh d tc c uto
u t ’ r e e rt h i
Me s a . t i i e n e h a e o te ir t o rt
ct si
determine whether and in what amount JustMed could recover damages on its conversion
and breach of fiduciary duty claims and whether an injunction to prevent further
misappropriation was warranted. See also Thomas Weisel Partners LLC v. BNP Paribas,
2 1 WL1 6 7 4( .. a 2 1 )c mp n ’d e tr ra h df u i y uy y a iai
00 2 7 4 ND C l 0 0 (o a y i c be c e i c r d t b fci t g
. s r o d a l n
t
en masse defection of 26 employees to competitor).
E ly n S re igB sn s H dRg t oR p bihMe a ’
mpo me t ce nn u ie s a ih T e u ls g ns
Law Information
Mendoza v. ADP Screening & Selection Servs., Inc., 182 Cal. App. 4th 1644 (2010)
Wia Me d z s e A PS re i a dS l t nS ri s Ic ( A S)o v l i s f
lm
l
i n o a u d D ce n g n e co ev e ,n .“ S ”fr ia o o
n ei c S o tn
Penal Code §§ 290.4 and 290.46, the Investigative Consumer Reporting Agencies Act and
d c rtr rlf a e u o S S ’a p rn d c s r t apo p cv e l e o
e l aoy ee b s d p n A Ss p ae t i l ue o rs e te mp y r f
a i so i o
information uncovered during a background check conducted on Mendoza, indicating his
s ts s rg trds x f n e ltdo teMe a ’L ww b i .( n o a c mp i
t u a a e iee e of d rie n h
a s e s g n a e se Me d z ’ o ln
s t s at
i ldte efc b t i n t f mai lae ete )I rs o s t Me d z ’
mpe h s a t u d o af te lg h m. n e p n e o n o a
i s d i vy l
r s
c mp i , A Sf das e i moi t s i p ru n t C l ris ni L P s tt.
o ln S S i
at le p c l t n o tk us a to af n ’a tS A P t ue
a o re i a
o - a
T eta c ut rne S S ’moi t s i tec mp i atr o c d gtec n u t
h r lo rga td A Ss t n o tk h o ln f c n l i h o d c
i o re at e un
ae e b Me d z ao ei fr ea c o S S ’Frt me d n r hs f o
lg d y n o a rs n ut rn e f A Ss i A n me ti t o c mmec l
l h s g ria
speech on a matter of public interest and that Mendoza could not establish a probability that
h w u pe a o temei.T eta c ut d c i a oi l e ama d tr a ado
e o l rv i n h
d l rs h r lo rs e io l n u d
t i ’ sn s cd n aoy w r f
atre ’fe i tea u t f 4 ,9 .5i favor of SASS. The Court of Appeal affirmed,
t n y e sn h mo n o $ 25 37 n
o s
holding that the anti-SLAPP statute is available to SASS even though it is a commercial
e trr ea dta po in e l e sre i rp r ia“rtc da ti” n e
nepi n h t rv i mp y e ce n g e ot s poe t cvy u d r
s dg o n s e it
the statute.
Fih E gn e’ Whslbo e Cam Wa N t re tdB
l t n ie r
g s it lw r li
e s o P e mpe y
Federal Law
Ventress v. Japan Airlines, 2010 WL 1729705 (9th Cir. 2010)
Mat V nrs, f h e g e ro J p nAr e ( A ” ae e h e l me t a
rn e t s a l t n i e fr a a in s “ L) lg d i mp y n w s
i e i
g n l
i J ,l s o
terminated in violation of the California whistleblower statute (Labor Code § 1102.5(b)) for
allegedly reporting safety violations six months after they occurred. JAL moved for judgment
on the pleadings, asserting complete federal preemption by the Federal Airline Deregulation
Act of 1978, as amended by the Whistleblower Protection Program. The Ninth Circuit held
California Employment Law Notes 2

3. ta b c u eV nrs d n t tr p “ev e (e,tepi s sh d l , r i a d
h t e a s e t s i o i er ts ri ”i .“
e d n u c . h r e , c e u s oin n
c e gs
d sn t n o tep i - -o trn p r t no p se g r, ag o ma” h c i w s
e t ai s fh o top i t s ot i f a s n es c ro r i , i lm a
i o nt n a ao l s a
)
not preempted by federal law. Compare Wise v. Verizon Communications Inc., 600 F.3d
1180 (9th Cr2 1 )e l e ’c i ain f m d n l f i bi b n f w r
i 0 0 (mp y e lms r i r
. o s a s g o e i o d a iy e ei ee
a s l t ts
preempted by ERISA).
P rc eD ae Ma O e“ id r F e T S ls es n
os h e lr y w Fn e’ e ” o ae p ro
s
Wald v. Truspeed, 2010 WL 1744893 (Cal. Ct. App. 2010)
Ae Wa , h ii teb s e s ff d g b y ga dte s l ga a u e P rc e ,
l x l w o sn h u i s o “n i , u i n h n ei g i s d osh s
d n i n n ln n ”
found 11 Porsches for Truspeed (a car dealer), which Truspeed sold without paying Wald the
f d r fe I rs o s t Wa ’l s i g i t rs e dae i be c o c nrc
i e’ e . n e p n e o lsa u a a s Tu p e lg g ra h f o t t
n s d w t n l n a,
u j t ni me t n f u , rs e da s r dta Wa l k dad a r le s a da
n s e r h n a d r d Tu p e set h t l a e
u c a e d c e l ’ i ne n
es c
s l p ro ’le s a d teeoe h w s ardf m rc v r ga a s Tu p e .Wa
a s es n i n e n ,h rfr, e a b r r e o ei g i t rs e d
e sc e o n n l d
argued that he was really a salesperson and not a dealer and that he should be able to
rc v r g i t rs e d T eta c ut u ti dTu p e ’d murr i o t a et
e o e a a s Tu p e . h r lo rs s n
n i a e rs e d e r wt u l v o
s e h e
a n , u teC ut f p e le es d h ln ta Wa w s i s b tn eas l p ro ”
me d b th o ro A p a rv re , o i h t l a “ u s c
dg d n a a s es n
e
fr rs e d A frh fc ta Wa a ol k das l p ro ’le s ,h C ut e
o Tu p e . s o te a th t l l a e d s c a s es n i n e te o rh l
e sc d
that the licensing requirement exists to protect the public from unscrupulous dealers and not
dealers from their own salespeople. The Court also held that Wald could proceed with his
fraud claim.
Trial Court Properly Denied Class Certification To Restaurant Managers
Arenas v. El Torito Restaurants, Inc., 183 Cal. App. 4th 723 (2010)
The plaintiffs in this case are salaried managers at El Torito, El Torito Grill and
G a a H r ’rs ua t i C l ri f m Ma 2 0 t tepe e t Pa t s lg dte
u d l ar s e t rnsn af n r
a y a i a o
o y 0 2 o h rs n. lni ae e h y if l
f
were misclassified as employees exempt from overtime because they routinely spent more
than half of their working hours performing duties delegated to non-exempt employees such
as operating and closing cash registers, preparing food products, cooking, preparing drinks,
tending bar, etc. In support of their motion to certify the class, plaintiffs alleged common
questions of law and fact, including that all managers share the same or similar employment
duties and activities, are automatically classified as exempt, and are denied the benefits and
protections of the employment laws and regulations in the same manner. Plaintiffs moved for
certification of three subclasses of employees: kitchen managers, department managers and
general managers. The trial court denied class certification after determining that resolution of
the common issues would require mini-trials concerning the circumstances of each
i id aso d t s T eC ut f p e l f me , ge i wt teta c ut c n l i
n v u l j ui . h o ro A p a af d a re g i h r lo rs o c s n
di ’ b e i
r n h i ’ uo
ta “ n g r, a e s ly nte j d sr t n , eea arl mi l si w s o
h tma a es b s d o lo h i o e ci i s w r s u
e rb po e s a i d a nt
csf e
a n b t c mmo po f See also Weigele v. FedEx Ground Package Sys., 2010 WL
me a l o o
e n ro. ”
1 3 0 1(.. a 2 1 )ga t gF d x moi t d c rf c s o fr r n g r)
3 7 3 SD C l 0 0 (rni e E ’ t n o e et l s fome ma a es.
. n s o i a
y
Police Officers Were Properly Denied Compensation For Donning And
Doffing Uniforms
Bamonte v. City of Mesa, 598 F.3d 1217 (9th Cir. 2010)
The plaintiffs in this case are employed as police officers for the City of Mesa, Arizona. They
c ne d dta tecy iae teF iL b r tn ad A t“L A) y ai t
o tn e h th i v l d h a a o Sa d rs c ( S ”b fi g o
t ot r F ln
compensate them for the time spent donning and doffing their uniforms and accompanying
gear. The district court dismissed the lawsuit on summary judgment, and the Ninth Circuit
afme , o i ta b c u e“ ] rq i me t f w rl tee l e, rh n tr o
fi d h ln h t e a s [ o e u e n o l ,u ,h mp y ro te aue f
r dg n r a e o
tew r ma d ts o n ga dd f ga tee l e’pe s s rte ta a h me te
h ok n ae d n i n of th mp y r rmi ”ah rh n t o ,h
n i
n o s e
time spent doing so was not compensable under the FLSA.
California Employment Law Notes 3

4. Miitr l x e t nB r dS miain ’ li F r n adO et
nsei E c pi ar e n r s Cams o U p i v rme
a o e a i
Rosas v. The Corporation of the Catholic Archbishop of Seattle, 598 F.3d 668
(9th Cir. 2010)
Cesar Rosas and Jesus Alcazar were Catholic seminarians who sued the Corporation of the
Catholic Archbishop for, among other things, failure to pay them overtime wages under
Washington state law. Based on the ministerial exception, the district court dismissed the
case on the pleadings. The Ninth Circuit affirmed, holding that the Religion Clauses of the
Frt me d n rq i a“ n tr l xe t n t e l me t tttsfh s tt’
i A n me te u e mis i e c pi ”o mp y n s ue i e t ue
s r ie a o o a t a s
a pc t nw u i efr wt arli sn t t n e l me t e io s o c ri
p lai o l n r e i
i o d t e h eg u i i i ’ mp y n d c i c n en g
io st o s
u o sn n
its ministers.
Trainee/Interns Of Non-Profit Organization Are Exempt From Minimum
Wage Law
The California Division of Labor Standards Enforcement opined that an intensive educational
and training program designed for young urban adults (18-24 years old) that places these
individuals in internships with non-profit and for-profit businesses is exempt from the minimum
wage law (interns receive a stipend but not a salary or wages). DLSE Opinion Letter
(Apr. 7, 2010), available at http://www.dir.ca.gov/dlse/OpinionLetters-byDate.htm.
Po k u r n al2 0L b r n E l me t w es a a de s h mo t o l a dc ae g gl o a d
rsa e’ e r 0 a o a d mp y n l y r c n d rs te s c mp x n h ln i a r n
s y o a e l n b
employment law issues faced by employers.
The following Los Angeles attorneys welcome any questions you might have.
Contacts
Harold M. Brody, Partner
3 02 45 2 –h rd @po k u r o
1 .8 .6 5 bo y rsa e. m c
Anthony J. Oncidi, Partner
3 02 45 9 –a n i@po k u r o
1 .8 .6 0 o c i rsa e. m
d c
Mark Theodore, Partner
3 02 45 4 –mte d r@po k u r o
1 .8 .6 0 h o oe rsa e. m
c

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California Employment Law Notes 4