As many large employers in California have experienced, it is all too common to have separate employees file duplicative PAGA actions in separate courts covering the same alleged claims on behalf of the same group of employees.  PAGA, of course, refers to the Private Attorneys General Act—a unique California law that allows an employee to essentially stand in the shoes of the State of California and file a lawsuit seeking penalties (that otherwise could be collected by the State) on behalf of all aggrieved employees of the employer for a variety of wage and hour violations.  In this way, a PAGA plaintiff sues in his or her own name but as a proxy for the State.  When a PAGA case settles, the attorney representing the employee plaintiff generally gets to keep 1/3 of the total settlement amount, which usually is a big chunk of money.  The remainder of the settlement is split roughly 75% payable to the State and only 25% payable to the allegedly aggrieved employees.  [In short, PAGA is a cash cow for plaintiffs’ attorneys and the State, not so much for the actual employees who are the supposed victims of the wage and hour violations alleged in the case.] 

Although most PAGA cases are resolved by way of settlement, complications can arise where more than one PAGA case has been filed against the employer by different individual plaintiffs who purport to represent the same “class” of employees.  Typically, the employer will reach a settlement with the plaintiff in one of the cases while the other cases remain pending.  The settlement is subject to court approval but once it is approved, it is binding on all employees covered by the settlement.  This effectively moots the remaining duplicative PAGA cases.  To avoid this result, some plaintiffs’ attorneys (not wanting to lose out on getting an attorney fee payday in their cases) have begun trying to intervene in the settled PAGA action in order to object to the settlement and try to gain a seat at the table and some chance of recovering attorney fees (which, of course, is the primary driver behind these lawsuits). 

Prior to today, there was a split among California courts as to whether intervention was permissible for this purpose.  Today, the California Supreme Court resolved this split by holding, in Turrieta v. Lyft, Inc., that a PAGA plaintiff does not have a cognizable interest on behalf of the State of California to intervene in a separate PAGA action (also brought on behalf of the State of California) in order to challenge a settlement.  This is a rare but welcome, employer-friendly ruling from the California Supreme Court.

In rejecting the right to intervene to challenge a PAGA settlement, the Court reasoned that there is no need to allow separate employee-plaintiffs to intervene to ensure the fairness of a settlement because PAGA settlements are already subject to court approval with the court thereby already having the duty to ensure the settlement is fair.  By contrast, if intervention were permissible, it would undermine the ability of parties to settle PAGA actions.

Although this is a favorable decision, the Court unfortunately left the door open for plaintiffs’ attorneys to make slightly different intervention arguments in PAGA cases.  The Court was careful in stating that there is no State interest to intervene in a duplicative PAGA case and that the State’s interest was the only interest asserted in the case before it.  The Court emphasized that the would-be intervenor had not sought to intervene to protect his own personal interest in the case as distinguished from the representative/State interest in the case.  Although the Court did not express any opinion on whether an individual interest would be sufficient to justify intervention, this issue no doubt will be the subject of future litigation.  For now, this is a welcome development for employers battling abusive PAGA litigation in California.