Case 3:18-cv-01190-JO-JLB Document 312 Filed 07/05/22 PageID.16368 Page 1 of 17
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`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF CALIFORNIA
`
` Case No.: 18cv1190-JO-JLB
`
`ORDER GRANTING PLAINTIFFS’
`MOTION FOR CLASS
`CERTIFICATION
`
`DANIEL LUDLOW, individually and on
`behalf of others similarly situated; and
`WILLIAM LANCASTER, individually
`and on behalf of others similarly situated,
`Plaintiffs,
`
`v.
`FLOWERS FOODS, INC., a Georgia
`corporation; FLOWERS BAKERIES,
`LLC, a Georgia limited liability company;
`and FLOWERS FINANCE, LLC, a
`limited liability company,
`
`Defendants.
`
`
`Plaintiffs are current and former delivery drivers alleging they were misclassified by
`Defendants as independent contractors instead of employees. Plaintiffs bring a wage and
`hour action arising from the alleged misclassification, asserting claims under the California
`Labor Code and related wage orders for failure to pay overtime, unlawful deductions from
`wages, failure to indemnify for necessary expenditures, and failure to provide proper wage
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`Case 3:18-cv-01190-JO-JLB Document 312 Filed 07/05/22 PageID.16369 Page 2 of 17
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`statements. Dkt. 56 (FAC).1 Plaintiffs have filed a motion for class certification of these
`claims. Dkt. 213. The Court held oral argument on March 30, 2022. For the reasons
`discussed below, Plaintiffs’ motion is GRANTED.
`I.
`BACKGROUND
`
`A. Defendants’ Business
`Defendant Flowers Foods, Inc. (“Flowers Foods”) is a national bakery company
`behind popular brands such as Wonder Bread, Nature’s Own, and Dave’s Killer Bread.
`FAC ¶ 21. Flowers Foods operates as the sole parent company of Defendant Flowers
`Bakeries, LLC (“Flowers Bakeries”), 2 which in turn operates as the sole parent company
`of multiple operating subsidiaries located throughout California and the United States. Id.
`¶¶ 17, 18. According to Flowers Foods’ investor materials, Flowers Foods is “America’s
`premier baker” that “produces and markets bakery products” in the “retail and food
`service” market. Dkt. 213-5 (Declaration of Alex Tomasevic in support of Plaintiffs’
`Motion for Class Certification, “Tomasevic Decl.”), Ex. 1. Flowers Foods claims in its
`SEC filings that it is the “second largest producer and marketer of packaged bakery foods
`in the US” and “operate[s] in the highly competitive fresh bakery market.” Id., Ex. 2 at 11.
`Flowers Foods’ customers are retail and foodservice locations such as Walmart and Costco.
`FAC ¶ 29. With sales of $3.9 billion in 2017, Flowers Foods generates revenue from sales
`of the bakery products to its retail and foodservice customers. Tomasevic Decl., Ex. 1 at
`4; Ex. 2 at 5–6.
`According to Flowers Foods, its key business functions include distribution and
`delivery of these packaged bakery goods to its customers. Tomasevic Decl., Ex. 1. Flowers
`
`
`1 This Court also presides over two other misclassification lawsuits filed against Defendants and
`its subsidiaries: (1) Goro et al v. Flowers Foods, Inc. et al, 3:17-cv-2580-JO-JLB, which is a related case
`brought by individual plaintiffs; and (2) Maciel et al. v. Flowers Foods, Inc. et al, 3:20-cv-02059-JO-JLB,
`a class action that was transferred from the Northern District of California and consolidated with this
`action.
`
`2 Flowers Bakeries, jointly referred to with Flowers Foods as “Flowers” in the parties’ briefing, is
`in charge of “sales related activities,” such as negotiations with the customers on price, shelf space, and
`distributor service requirements that are then communicated to the operating subsidiaries. FAC ¶ 17.
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`Case 3:18-cv-01190-JO-JLB Document 312 Filed 07/05/22 PageID.16370 Page 3 of 17
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`Foods’ business model relies on a system of delivery drivers such as Plaintiffs to deliver
`the bakery products to the retail and foodservice locations. Tomasevic Decl., Ex. 19.
`Flowers Foods refers to these delivery drivers as “distributors.” Each distributor enters
`into a standard and substantially identical distributor agreement with a local operating
`subsidiary of Flowers Foods and Flowers Bakeries that governs the distributor relationship.
`Id., Ex. 6.
`B.
`Plaintiffs’ Role and Responsibilities
`The Distributor Agreement (“DA”) signed by the delivery drivers sets forth the
`working relationship between the distributor and Defendants. Tomasevic Decl., Ex. 6. The
`DA labels the delivery drivers as “independent contractors.” Id. at § 16.1. As a prospective
`distributor, the delivery driver purchases the “right” to deliver Flowers Foods’ bakery
`products in a specific geographic territory.3 Id. at § 2.4. The territory dictates which
`specific bakery products are delivered to the customer locations in the given territory. Id.
`at §§ 2.2–2.3. The distributor can purchase and own more than one territory or resell his
`or her territory to another person for a profit. Id. § 15.1. Distributors may hire helpers to
`service their territory while they hold other full-time jobs (so-called “absentee”
`distributors). Id. § 16.2.
`The DA also describes how the distributor purportedly earns money with these
`territory rights. Under the DA, the distributor “purchases” bakery products from Flowers
`Foods and then “re-sells” those products to the retail and foodservice customers within
`their given territory. Tomasevic Decl., Ex. 6 at §§ 4.1, 8.6. The distributor earns money
`based on the standard margin—that is, the difference between the purchase price and the
`sale price—which is set by Flowers Foods based on its negotiations with the customers on
`the product price. The DA prohibits the distributor from selling stale products to the
`customers, and so Flowers Foods will “repurchase” a percentage of the distributor’s stale
`products. Id. at §§ 12.2, 12.3. Flowers Foods “repurchases” the stale products by charging
`
`3 Financing for this purchase is offered to distributors by Defendant Flowers Finance, LLC, another
`subsidiary of Flowers Foods. FAC ¶ 19.
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`Case 3:18-cv-01190-JO-JLB Document 312 Filed 07/05/22 PageID.16371 Page 4 of 17
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`the distributors a fee. FAC ¶ 102. Flowers Foods also provides the distributors with
`advertising and branded material to increase sales. Tomasevic Decl., Ex. 6 at §§ 13.1, 13.2.
`Some distributors use the marketing materials and displays to promote their sales, while
`others do not. Dkt. 237-1 (Declaration of Frank L. Tobin in support of Defendants’
`Opposition to Plaintiffs’ Motion for Class Certification, “Tobin Decl.”), Ex. 21.
`The DA further describes the quality standards that distributors must meet as part of
`their job requirements. For example, the DA requires the distributor to perform his or her
`services in accordance with “the standards that have developed and are generally accepted
`and followed in the baking industry,” including maintaining an adequate and fresh supply
`of products in the stores, actively soliciting stores not being serviced, properly rotating the
`products, promptly removing stale products, maintaining proper service per the store’s
`requirements, and maintaining equipment in sanitary and safe conditions. Tomasevic
`Decl., Ex. 6 at § 2.6. The DA also requires the distributor to obtain his or her own delivery
`vehicle and insurance, and to keep the delivery vehicle clean, professional, and safe. Id. at
`§ 9.1. The DA further requires the distributor to use Flowers Foods’ “proprietary
`administrative services” to collect sales data or prepare sales tickets. Id. at § 10.1. Flowers
`Foods charges the distributor a fee unilaterally established by Flowers Foods to use these
`services. Id. at § 10.2. The DA does not require a standard outfit or uniform, but some
`distributors wear a polo shirt or branded shirt based on the recommendation of Defendants.
`Tobin Decl., Ex. 23.
`As set forth in the DA, the relationship between the distributor and Defendants is
`one of indefinite duration. Under the DA’s terms, the distributor relationship continues
`unless the distributor sells the territory, Flowers Foods ceases to use distributors in a
`territory for “business reasons,” or Flowers Foods terminates as a result of the distributor
`engaging in certain enumerated activities deemed non-curable or repeated curable
`breaches. Tomasevic Decl., Ex. 6 at §§ 3.1, 17.1.
`///
`///
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`
`II. CLASS CERTIFICATION STANDARDS
`Class certification is governed by Federal Rule of Civil Procedure 23 (“Rule 23”).
`To obtain certification, a plaintiff bears the burden of proving that the class meets all four
`requirements of Rule 23(a) and at least one of the requirements of Rule 23(b). Wal-Mart
`Stores, Inc. v. Dukes, 564 U.S. 338, 350–51 (2011); Zinser v. Accufix Research Inst., Inc.,
`253 F.3d 1180, 1186 (9th Cir. 2001). Rule 23(a) sets out four prerequisites: (1) numerosity,
`(2) commonality, (3) typicality, and (4) adequacy. Ellis v. Costco Wholesale Corp., 657
`F.3d 970, 979–80 (9th Cir. 2011). If these four prerequisites are met under Rule 23(a), the
`court must then decide whether the class action is maintainable under Rule 23(b). Under
`Rule 23(b)(3), a class may be certified if the court finds that “the questions of law or fact
`common to class members predominate over any questions affecting only individual
`members, and that a class action is superior to other available methods for fairly and
`efficiently adjudicating the controversy.” Vinole v. Countrywide Home Loans, Inc., 571
`F.3d 935, 944 (9th Cir. 2009) (quoting Fed. R. Civ. P. 23(b)(3)).
`At the class certification stage, the court must take the substantive allegations of the
`complaint as true, but it “also is required to consider the nature and range of proof necessary
`to establish those allegations.” In re Coordinated Pretrial Proceedings in Petroleum
`Prods. Antitrust Litig., 691 F.2d 1335, 1342 (9th Cir. 1982). The court must engage in a
`“rigorous analysis” of each Rule 23(a) factor, which often “will entail some overlap with
`the merits of the plaintiff’s underlying claim.” Dukes, 564 U.S. at 351. If the court
`concludes that the moving party has carried its burden, then the court is afforded “broad
`discretion” to certify the class. Zinser, 253 F.3d at 1186.
`III. STANDARDS FOR MISCLASSIFICATION CLAIMS
`Prior to considering whether Plaintiffs’ claims satisfy Rule 23, the Court first
`addresses Defendants’ argument regarding the applicable legal framework to evaluate the
`putative class members’ central claim that they were misclassified as independent
`contractors instead of employees. Plaintiffs argue that the ABC Test articulated in
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`Dynamex Operations W. v. Superior Court, 4 Cal. 5th 903 (2018),4 governs this inquiry.
`The ABC Test provides that a hiring entity is an employer if any one of the following three
`prongs is not met:
`
`(A) that the worker is free from the control and direction of the
`hiring entity in connection with the performance of the work,
`both under the contract for the performance of the work and in
`fact; and (B) that the worker performs work that is outside the
`usual course of the hiring entity’s business; and (C) that the
`worker is customarily engaged in an independently established
`trade, occupation, or business of the same nature as the work
`performed. Dynamex, 4 Cal. 5th at 957 (emphasis in original).
`Because the ABC Test requires all three prongs to be met before a worker can be
`deemed an independent contractor, a class need only establish that a hiring entity failed
`one prong in order to prove its misclassification claim. Id. at 963–64. Defendants argue
`that before the ABC Test can be applied to Plaintiffs’ claims, the Court must first conduct
`individualized determinations of whether Flowers Foods and Flowers Bakeries, as parent
`companies of the subsidiaries that directly contract with Plaintiffs, constitute “hiring
`entities.” The Court disagrees with Defendants.
`Contrary to Defendants’ argument, the law does not require any threshold “hiring
`entity” analysis before the Dynamex ABC Test is applied to determine whether a worker
`is an employee or independent contractor. Mejia et al. v. Roussos Construction, Inc., 76
`Cal. App. 5th 811, 819 (2022) (finding that a threshold hiring entity test was not intended
`by Dynamex court and would “run counter to the intent of California wage and hour laws”);
`People v. Uber Technologies, Inc., 56 Cal. App. 5th 266, 288 (2020) (concluding that
`Dynamex did not intend for additional threshold step in the ABC Test and rejecting hiring
`entity test). The California Supreme Court in Dynamex affirmed that any entity that
`“suffer[s] or permit[s]” an individual “to work” for the entity’s benefit is an employer if
`the ABC Test is met. See Martinez v. Combs, 49 Cal. 4th 35, 65 (2010). The “to suffer or
`
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`4 The ABC Test in Dynamex was subsequently codified by Cal. Lab. Code § 2775(b)(1).
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`Case 3:18-cv-01190-JO-JLB Document 312 Filed 07/05/22 PageID.16374 Page 7 of 17
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`permit to work” standard looks to whether the putative employer had “knowledge of and
`failure to prevent the work from occurring.” Id. at 70. The Ninth Circuit has made clear
`that this standard applies to entities even when they do not directly contract with the worker
`or directly receive the services of the worker: so long as “the putative employee was
`providing a service to the hiring entity even indirectly, the hiring entity can fail the ABC
`test and be treated as an employer.” Vazquez v. Jan-Pro Franchising Int’l, Inc., 986 F.3d
`1106, 1124 (9th Cir. 2021) (emphasis in original) (finding that defendant “could be
`Plaintiffs’ employer under the ABC Test even though it is not a party to any contract with
`Plaintiffs”).
`Here, like the plaintiffs in Vazquez, the distributors provided delivery services that
`benefited Flowers Foods and Flowers Bakeries, with the full knowledge of those entities.
`Specifically, distributors were tasked with delivering the parent companies’ bakery
`products to their customers located within delivery routes, which were owned, financed,
`and sold by Flowers Foods. Tomasevic Decl., Ex. 2 at 5–6; FAC ¶ 19. Flowers Foods, the
`ultimate parent company, generated revenue from the sales of the bakery products
`delivered by distributors. Flowers Bakeries, an intermediate parent company, negotiated
`with the customers on the pricing of the delivered bakery products and the specific
`customer service requirements and quality standards for the delivery drivers to follow.
`FAC ¶ 17. Even though Flowers Foods and Flowers Bakeries did not directly contract with
`the delivery drivers through the DAs, Plaintiffs provided both entities a delivery service
`that they both knew about and permitted. Vazquez, 986 F.3d at 1124. Therefore, Flowers
`Foods and Flowers Bakeries are subject to the ABC Test without the need for a threshold
`“hiring entity” test.
`
`IV. CLASS CERTIFICATION
`Having determined that the ABC Test is the applicable legal framework for
`Plaintiffs’ misclassification claims, the Court now turns to the class certification analysis.
`Plaintiffs seek to certify the Misclassification Class, which they define as “All persons who
`worked in California pursuant to a ‘Distributor Agreement’ or similar arrangement with
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`Flowers Food, Inc., or one of its subsidiaries, that were classified as ‘independent
`contractors’ during the period commencing four years prior to the commencement of this
`action through judgment. ‘Absentee’ distributors are not part of this class definition.” Dkt.
`213 at 18. The two named Plaintiffs are proposed class representatives.
`The Court first examines whether the four prerequisites of Rule 23(a) are satisfied
`with regard to the proposed class, then turns to whether common questions of law or fact
`predominate, and finally to whether a class action is the superior method for resolving the
`controversy.
`A.
`Plaintiffs Have Satisfied Rule 23(a)
`1.
`The Class is Sufficiently Numerous
`First, the Court finds that the proposed class of distributors is sufficiently numerous.
`To establish numerosity, a plaintiff must show that the represented class is “so numerous
`that joinder of all members is impracticable.” Fed. R. Civ. P. 23(a)(1). Although the
`numerosity requirement is not tied to a strict numerical threshold, trial courts have
`generally found classes of at least 40 members to satisfy the requirement. Rannis v.
`Recchia, 380 Fed. Appx. 646, 651 (9th Cir. 2010). Here, Plaintiffs allege that there are at
`least 172 distributors contracting with Flowers Modesto and 258 distributors contracting
`with Flowers Henderson. A class consisting of at least 430 members renders joinder
`impracticable and far exceeds the threshold of 40 class members that other trial courts have
`identified as sufficiently numerous. Plaintiffs have therefore satisfied the numerosity
`requirement.
`2.
`The Named Plaintiffs are Typical
`Second, the Court finds that the named plaintiffs are typical of the class. The Court’s
`typicality inquiry looks to whether “the claims or defenses of the representative parties are
`typical of the claims or defenses of the class.” Fed. R. Civ. P. 23(a)(3). This inquiry, which
`focuses on the relationship between the class and its representatives, considers “whether
`other members have the same or similar injury, whether the action is based on conduct
`which is not unique to the named plaintiffs, and whether other class members have been
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`injured by the same course of conduct.” Evon v. Law Offices of Sidney Mickell, 688 F.3d
`1015, 1030 (9th Cir. 2012). Courts examine the nature of the claim, rather than the specific
`facts of each violation, in conducting this inquiry. Hanon v. Dataprods. Corp., 976 F.2d
`497, 508 (9th Cir. 1992). Here, Defendants classified the named plaintiffs and the class
`members as independent contractors instead of employees. This course of conduct—that
`is, the alleged misclassification—affected the named plaintiffs and the other class members
`in the same manner and gives rise to identical claims for violations of the California Labor
`Code and related wage orders. Although the amount of damages allegedly owed to each
`class member and the named plaintiffs may vary, the claims and injury of the named
`plaintiffs are the same as those of the other distributors in the class.
`Defendants argue that the typicality requirement is not satisfied because the named
`plaintiffs do not have arbitration agreements, whereas some members of the putative class
`do. This concern is moot because the Court has since found that the arbitration agreements
`of distributors in this action are not enforceable. See Dkt. 307 (order denying Defendants’
`motion to compel arbitration on waiver grounds). Even if enforceable arbitration
`agreements were binding on members of the putative class, that factor alone does not
`necessarily result in atypicality. Courts have noted atypicality concerns when the named
`plaintiff, as opposed to one of the class members, “is subject to unique defenses which
`threaten to become the focus of the litigation,” Hanon, 976 F.2d at 508, but that concern is
`not present here. Accordingly, the Court finds that the typicality requirement is satisfied.
`3.
`The Named Plaintiffs are Adequate
`Third, the Court finds that the named Plaintiffs and class counsel are adequate.
`Defendants argue that class counsel are inadequate due to conflicts of interest arising from
`their representation of other class and individual plaintiffs in similar lawsuits against the
`same defendants. The Court is not persuaded.
`In determining adequacy of class counsel, courts consider whether “the
`representative parties will fairly and adequately protect the interests of the class.” Fed. R.
`Civ. P. 23(a)(4). The Court’s inquiry focuses on two questions: (1) whether “the
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`representative plaintiffs and their counsel have any conflicts with other class members,”
`and (2) whether “the representative plaintiffs and their counsel prosecute the action
`vigorously on behalf of the class.” Staton v. Boeing Co., 327 F.3d 938, 957 (9th Cir. 2003).
`Courts have found counsel to be inadequate where they represent multiple groups of
`plaintiffs with inherently conflicting claims, such as those with present or future claims in
`a global settlement fund, against the same defendant. Ortiz v. Fibreboard Corp., 527 U.S.
`815, 856 (1999). However, trial courts have not found class counsel inadequate “merely
`for representing another class against the same defendants when, for instance, the purported
`conflicts are illusory and speculative…and there are procedural safeguards protecting the
`class’s interests, such as requiring disclosure of the potential conflict to class members and
`requiring court approval for settlements.” Sandoval v. M1 Auto Collisions Centers, 309
`F.R.D. 549, 569 (N.D. Cal. 2015).
`Here, the Court finds no factors suggesting that class counsel will provide inadequate
`representation due to their concurrent representation of other plaintiffs in similar lawsuits
`against the same defendants. Plaintiffs’ counsel is also counsel for other Flowers Foods
`distributor plaintiffs
`in
`individual and class action
`lawsuits asserting similar
`misclassification claims and resulting wage violations against Defendants and their
`subsidiaries. See Goro et al v. Flowers Foods, Inc. et al, 3:17-cv-2580-JO-JLB; Maciel et
`al. v. Flowers Foods, Inc. et al, 3:20-cv-02059-JO-JLB. Defendants have not identified
`any inherent or potential conflicts of interest that would arise from the representation of
`similarly situated individuals and class members with similar claims.
`Unlike in Ortiz v. Fibreboard Corp., 527 U.S. 815 (1999), to which Defendants point
`in arguing inadequacy, this case presents no inherent conflict of interest. In Ortiz, class
`counsel represented plaintiffs with both existing and future injuries in a global asbestos
`settlement against the same defendant. 527 U.S. at 856. The court concluded that separate
`counsel was required to eliminate inherent conflicts of interest where the currently injured
`plaintiffs were interested in large immediate payments whereas the not-yet-injured
`plaintiffs were interested in inflation-protected funds for the future. Id. Here, unlike in
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`Ortiz, class counsel’s representation of both the class in this action and individual and class
`plaintiffs in similar actions does not present an inherent conflict of interest because no
`substantive law or limited settlement fund restricts the potential recovery for the plaintiffs.
`On this record, the Court concludes that any concern about conflicts of interest or adequate
`representation is speculative. Moreover, the Court notes that its oversight of potential class
`settlements provides a procedural safeguard that further protects the interests of the class.
`Sandoval, 309 F.R.D. at 569.
`4.
`There are Questions of Law and Fact Common to the Class
`Finally, the Court finds that the commonality requirement for class certification is
`satisfied. Commonality requires a plaintiff to show that “there are questions of law or fact
`common to the class.” Fed. R. Civ. P. 23(a)(2). A question of law or fact is common to
`the class if “the determination of its truth or falsity will resolve an issue that is central to
`the validity of each one of the claims in one stroke.” Dukes, 564 U.S. at 350. Thus, what
`matters is not the “raising of common ‘questions’ . . . but rather, the capacity of a class-
`wide proceeding to generate common answers apt to drive the resolution of the litigation.”
`Id. at 350 (emphasis in original). To demonstrate that class claims would produce a
`common answer, the party seeking certification must present “significant proof” that an
`employer operated under a “general policy” or practice. Wang v. Chinese Daily News, Inc.,
`737 F.3d 538, 543 (9th Cir. 2013) (citing Dukes, 564 U.S. 338 at 351–53). If there is no
`evidence that the entire class was subject to the same allegedly unlawful policy or practice,
`then there is no question common to the class. Kilbourne v. Coca-Cola Co., 2015 WL
`5117080, at *8 (S.D. Cal. July 29, 2015) (citing Ellis, 657 F.3d at 983).
`Here, the Court faces a common question at the heart of the action—whether
`Defendants misclassified its distributors as independent contractors instead of employees.
`And this common question can largely be determined by common evidence of Defendants’
`overarching business structure and business practices regarding their distributors. In
`arguing that commonality exists, Plaintiffs focus on Prong B of the ABC Test set forth
`above, which looks to whether the worker “performs work that is outside the usual course
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`of the hiring entity’s business.” Dynamex, 4 Cal. 5th at 957. As one of the three prongs of
`the ABC Test, Prong B comprises a significant portion of the misclassification analysis
`and, because the ABC Test is conjunctive, proof that Defendants failed this prong alone
`will be sufficient to establish Plaintiffs’ misclassification claim. Id. at 963–64. Here,
`whether the distributors’ delivery services is central to Defendants’ course of business will
`be determined in large part by common evidence across the class. For example,
`Defendants’ corporate filings regarding
`their business operations and financial
`performance will provide evidence of the nature of their business and what their usual
`course of business entails. See, e.g., Tomasevic Decl., Ex. 1; Ex. 2 at 11. Corporate
`representative testimony that describes the operational realities of the business also serves
`as common evidence of class-wide practices to prove the nature of Defendants’ course of
`business and the distributors’ role in that business. See, e.g., Tomasevic Decl., Ex. 14; Ex.
`23. Moreover, the standard DA signed by every distributor details the workers’ specific
`job requirements and responsibilities. These class-wide work requirements and practices
`can be used to determine whether the distributor is “necessary” or “merely incidental” to
`Defendants’ usual course of business. Vazquez, 986 F.3d at 1125–26. Because the above
`evidence about the distributors’ role in Defendants’ overall business structure will provide
`common, class-wide answers regarding the centrality of the distributors’ work to
`Defendants’ business, the Court thus concludes that Plaintiffs have satisfied the
`commonality requirement.
`Moreover, the Court also notes that the common evidence discussed above—
`namely, Defendants’ corporate practices and policies with regard to its distributors and the
`DA describing the nature of distributors’ responsibilities and working relationship with the
`company—also serves to provide common proof of whether Defendants satisfy Prong A
`of the ABC Test, which focuses on a putative employer’s control over the worker.
`Dynamex, 4 Cal. 5th at 957.
`///
`///
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`B.
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`Plaintiffs Have Satisfied Rule 23(b)
`Having concluded that Plaintiffs have met Rule 23(a) requirements, the Court now
`examines whether common questions will predominate over individual ones in deciding
`the threshold misclassification issue, and then, if necessary, the substantive Labor Code
`claims of the class members. The Rule 23(b)(3) inquiry looks to whether the putative class
`is “sufficiently cohesive to warrant adjudication by representation.” Fed. R. Civ. P.
`23(b)(3); Amchem Products, Inc. v. Windsor, 521 U.S. 591, 623 (1997). The court
`considers whether “members of a proposed class will need to present evidence that varies
`from member to member” or if “the same evidence will suffice for each member to make
`a prima facie showing or the issue is susceptible to generalized, class-wide proof.” Tyson
`Foods, Inc. v. Bouaphakeo, 577 U.S. 422, 453 (2016). When “one or more of the central
`issues in the action are common to the class and can be said to predominate, the action may
`be considered proper under Rule 23(b)(3) even though other important matters will have
`to be tried separately, such as damages or some affirmative defenses peculiar to some
`individual class members.” Id. (citing C. Wright, A. Miller, & M. Kane, Federal Practice
`and Procedure § 1778, pp. 123–124 (3d ed. 2005)).
`Here, as discussed above, the misclassification claim central to this proposed class
`will be susceptible to common, class-wide proof regarding the distributors’ role in
`Defendants’ overall business structure and Defendants’ level of control over the
`distributors. If Plaintiffs prove their threshold misclassification claim, the factfinder will
`then need to determine substantive wage claims for failure to pay overtime, unlawful
`deductions from wages, failure to indemnify for necessary expenditures, and failure to
`provide proper wage statements. The Court therefore examines the extent to which
`common questions are presented in Plaintiffs’ substantive wage claims.
`1.
`Failure to Pay Overtime
`First, Plaintiffs bring a claim for failure to pay overtime under Cal. Lab. Code § 510
`and the related wage orders, which require the payment of overtime compensation to non-
`exempt employees for over eight hours worked in a day, over forty hours worked in a week,
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`and the first eight hours worked on the seventh consecutive day of the work week. See
`Cal. Lab. Code § 510. Plaintiffs allege that the distributors in the putative class “regularly
`worked and continue to work” overtime hours without overtime pay “in accord with
`[Flowers Foods’] mandated schedule.” FAC ¶ 96. Defendants had a general practice of
`not paying distributors overtime regardless of the number of hours worked: the standard
`DA set out their policy on not providing these benefits to their distributors. Tomasevic
`Decl., Ex. 6 at § 16.1. Although the number of overtime hours worked by each class
`member is an individual question, the legality of Defendants’ class-wide policy of not
`paying overtime to all distributors, regardless of hours worked, is an issue subject to
`common proof.
`2.
`Unlawful Deductions from Wages
`Second, Plaintiffs bring a claim for unlawful deductions from wages under Cal. Lab.
`Code § 221 and the related wage orders, which prohibit employers from taking back wages
`that have been earned. See Cal. Lab. Code § 221. Plaintiffs allege that Flowers Foods
`withholds payments for certain administrative expenses and “charges [distributors] for
`stale product returned from retail locations that exceeds a certain percentage of sales.”
`FAC ¶ 102. As set forth in the standard DA, Defendants had a general practice requiring
`distributors to pay