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Okura v. Kaiser Foundation Health Plan Inc.

California Court of Appeals, Second District, First Division
Jul 29, 2008
No. B196372 (Cal. Ct. App. Jul. 29, 2008)

Opinion

NOT TO BE PUBLISHED

APPEAL from a judgment of the Superior Court of Los Angeles County Los Angeles County Super. Ct. No. BC337100, Peter D. Lichtman, Judge.

Law Offices of James B. Kropff, James B. Kropff; Ball, Ghaleb & Hulbert and Stephen C. Ball for Plaintiff and Appellant.

Law Offices of Douglas D. Schaffer and Douglas D. Schaffer for Pharmacists Planning Service Inc. and Pharmacy Defense Fund, Inc., as Amici Curiae on behalf of Plaintiff and Appellant.

Seyfarth Shaw, Thomas R. Kaufman and Mary E. Ahrens for Defendant and Respondent.


NEIDORF, J.

Retired Judge of the Los Angeles Superior Court assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.

In this case a managing pharmacist of an outpatient pharmacy sued his former employer for unpaid overtime wages on his own behalf and on behalf of other similarly situated pharmacists. The trial court granted summary judgment in favor of the employer, finding the pharmacist was an exempt executive employee and thus was not entitled to overtime pay. The key dispute in this appeal centers on whether the pharmacist’s supervisory act of “checking” the work of others in the pharmacy before releasing a prescription to a patient was an exempt managerial task or a nonexempt production task required of all pharmacists as part of their professional responsibilities. We conclude we need not reach the broader question whether a pharmacist’s statutory duty of “checking” the work of unlicensed personnel is supervision and thus per se an exempt executive act. We conclude the record in this case affirmatively establishes that the manner, method and purpose of this particular pharmacist’s “checking” prescriptions was as a management tool—qualitatively different in purpose and effect from the mandated duty imposed on line pharmacists in the production of filling prescriptions. We accordingly affirm the judgment.

BACKGROUND

We accept as true the following facts and reasonable inferences supported by the parties’ undisputed evidence on the motion for summary judgment. (See Raghavan v. Boeing Co. (2005) 133 Cal.App.4th 1120, 1125.)

Appellant John C. Okura is a licensed pharmacist. Okura began working for respondent Kaiser Foundation Health Plan, Inc. (Kaiser) in 1984. In 2000 Okura became the outpatient pharmacy manager for the Kaiser pharmacy in Glendale. Kaiser classified the manager position at the Glendale pharmacy at level two of three because the Glendale pharmacy was a medium to large pharmacy which filled between 425 to 850 prescriptions per day. The job profile for a level two outpatient pharmacist manager stated it was a nonunion, exempt position.

Okura applied for the outpatient pharmacy manager position because as a manager he could “effect changes in the pharmacy” and because the manager job presented a “challenge.” On the other hand, Okura found the management position “scary,” because a manager is “responsible for everything.” Okura knew that by becoming a manager his pay would no longer be based on the numbers of hours he worked.

Okura was the highest ranking and the only managerial employee at the Glendale pharmacy. All the other employees in the pharmacy, including the pharmacists, were unionized, hourly employees. When Okura began working at the Glendale pharmacy, the staff consisted of himself, one full-time line pharmacist, one part-time line pharmacist, one full-time pharmacy tech, two part-time pharmacy techs, five pharmacy assistants and one pharmacy intern.

In the pharmacy business, employees refer to the process of filling prescriptions as working “on the line,” or “working on the case,” meaning the production work of filling prescriptions. Typically an intake assistant is the first person to deal with a patient. The assistant collects the patient’s prescription and Kaiser membership card. The assistant time-stamps the prescription and places it into a carrying box for the typist. The typist types up the prescription and when the label comes out of the printer the typist places the label and prescription on the counter. A pharmacy tech matches the prescription with the label and retrieves the medication from inventory. Pharmacy techs are authorized to “fill” prescriptions, meaning they may count out medications, put the medication in bottles, and prepare and affix labels to the bottles. If a pharmacy tech “fills” a prescription in this manner then a pharmacist is required by law to “check” the prescription by verifying it has been filled accurately and appropriately. The line pharmacist in the production performs this quality control “check” by verifying the medication is correct, that the quantity of the medication is accurate, that the refill dates are properly reflected, that regulatory numbers when necessary appear on the label and that all these items match the patient’s prescription. Once the pharmacist “checks” a filled prescription in this manner the pharmacist places his or her initials on the label of the prescription medication. The prescription is then permitted to be released to the patient.

Labor Code section 4115 governs pharmacy technicians. Subdivision (a) states: “Notwithstanding any other provision of law, a pharmacy technician may perform packaging, manipulative, repetitive, or other nondiscretionary tasks, only while assisting, and while under the direct supervision and control of, a pharmacist.” (Italics added.)

A pharmacy intern may also fill prescriptions in the same manner as a pharmacy tech. However, unlike pharmacy techs, pharmacy interns are authorized to perform patient consultations.

Labor Code section 4114 concerns intern pharmacists and specifies: “An intern pharmacist may perform any activities pertaining to the practice of pharmacy as the board may determine by regulation. Whenever in this chapter the performance of an act is restricted to a pharmacist, the act may be performed by an intern pharmacist under the supervision of a pharmacist. The pharmacist shall not supervise more than one intern pharmacist at any one time.” (Italics added.)

If the pharmacy is exceptionally busy a line pharmacist or pharmacy manager will occasionally perform the work of a pharmacy tech by retrieving the medication, placing the medication in a container, and so forth. In this situation the pharmacist’s work does not need to be checked by another licensed pharmacist.

Okura testified he often worked between 50 and 60 hours a week managing the Glendale pharmacy. Of these hours, Okura testified he spent between 10 to 15 hours a week on strictly management tasks such as preparing work schedules, payroll and performance reviews for his employees. Okura was responsible for hiring, firing and disciplining pharmacy employees. Okura conducted periodic staff meetings to inform pharmacy employees of recent changes in Kaiser’s policies, industry regulations or with regard to certain drugs. Okura was responsible for monitoring inventory to detect overstocked drugs and expired medications and the adequacy of supplies. Okura was similarly responsible for monitoring a variety of matters including sales, cash receipts, quality assurance, compliance with federal and state regulations, sales and pricing of over-the-counter medications, and record keeping for narcotic and other controlled substances. Okura was also responsible for handling customer complaints and patient consultation compliance.

Kaiser dictated the pharmacy’s target budget, but as the manager Okura had discretion to decide how best to apply allocated funds. Okura similarly had the discretion to exceed his target budget when necessary, provided he compensated for excess expenditures in subsequent months.

In addition to the time he spent on managerial tasks, Okura testified he devoted on average seven hours a day, or 35 hours a week, to “checking.” Okura stated his “checking” was different from the mandated checking performed by the line pharmacists. Okura testified he would check to ensure the line pharmacist had signed off on the prescription. Okura monitored the time it took to fill prescriptions to ensure compliance with Kaiser’s policy of requiring no more than 15 minutes to fill a prescription. In the event prescriptions took longer than 15 minutes to fill, Okura stated he would determine the source of the problem and correct it to speed up the process. Okura also double checked to make sure the drugs matched the prescription label and checked for possible drug interactions. Okura similarly checked to make sure the National Drug Control numbers on the prescription matched, and made sure a request for a prescription refill was not premature. Several of these “checking” tasks were the same sorts of issues all pharmacy personnel were supposed to look for but Okura said his added checking, or “rechecking,” helped to detect the occasional oversight.

As part of his rechecking process Okura would not need to initial the prescription label. His initials were unnecessary in the vast majority of prescriptions filled at the Glendale pharmacy because a line pharmacist had “already checked it” and initialed the label. Okura only acted as a filling line pharmacist or as a statutory checker in the event the pharmacy techs and line pharmacists were all then busy with other matters in the pharmacy. Okura did not specify precisely how often this occurred, or quantify how much time he spent on average filling in for line pharmacists.

Okura testified he did not have an employee sufficiently responsible to take over his rechecking and he “always felt the responsibility would have to go to the manager.” Okura believed Kaiser preferred its outpatient pharmacy managers to perform this “rechecking” process. Okura explained a manager has more invested in the company and typically would be more concerned about complying with Kaiser’s 15-minute time limit for filling prescriptions. However, Okura declared Kaiser never told him “checking” would be a task expected of him as an outpatient pharmacy manager. Okura said “checking” was not listed as a requirement in the job description for the outpatient pharmacy manager position. Nor, Okura pointed out, was “checking” analyzed as an area of interest in a comprehensive survey Kaiser performed concerning work typically performed by outpatient pharmacy managers.

In November 2004 Kaiser placed Okura on administrative leave. Okura’s employment with Kaiser ended in December 2004. Okura’s ending annual salary was $116,740.

In July 2005 Okura filed suit against Kaiser seeking unpaid overtime on his own behalf and as a class representative of similarly situated Kaiser employees (Lab. Code, §§ 218, 1194, subd. (a)). Kaiser moved for summary judgment claiming Okura’s sworn deposition testimony explaining his functions as manager of the outpatient Kaiser pharmacy conclusively demonstrated Okura satisfied all the criteria for the executive exemption from overtime under the applicable Industrial Welfare Commission Wage Orders.

Okura’s complaint also alleged a derivative claim for unfair competition for failing to pay overtime wages to its pharmacy managers. (Bus. & Prof. Code, § 17200.)

Okura had also named Kaiser Foundation Hospitals as defendant. Kaiser Foundation Hospitals separately moved for summary judgment on the ground it was never Okura’s employer. Okura did not oppose its motion and the propriety of the resulting judgment against him is not the subject of this appeal.

The trial court permitted supplemental briefing and heard extensive oral argument on multiple court days before it issued its ruling. The parties agreed Okura met five of the six elements for the executive exemption from overtime. The disputed element was whether the time Okura spent “checking” was an exempt managerial activity or whether his “checking” was nonexempt production work required of all licensed pharmacists and thus just part of the usual business of pharmacy. Okura argued that even if “checking” as part of his professional duty could be considered a form of supervision, it was not managerial supervision such that it would render it an exempt duty for purposes of the executive exemption. Kaiser, in contrast, argued supervision of pharmacy subordinates is per se an exempt task.

The trial court found the nature of Okura’s “checking” was primarily geared toward ensuring compliance with company policy and was thus an exempt managerial task for purposes of the executive exemption. Accordingly, the trial court entered a summary judgment in favor of Kaiser.

DISCUSSION

I. Standard of Review

A motion for summary judgment must be granted if all the papers submitted show there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law. (Code Civ. Proc., § 437c, subd. (c).) “A defendant . . . has met his or her burden of showing that a cause of action has no merit if that party has shown that one or more elements of the cause of action, . . ., cannot be established, or that there is a complete defense to that cause of action. Once the defendant . . . has met that burden, the burden shifts to the plaintiff . . . to show that a triable issue of one or more material facts exists as to that cause of action or a defense thereto.” (Code Civ. Proc., § 437c, subd. (p)(2); Raghavan v. Boeing Co., supra, 133 Cal.App.4th at p. 1132.) We review the trial court’s grant of summary judgment de novo and decide independently whether the parties have met their respective burdens and whether facts not subject to triable dispute warrant judgment for the moving party as a matter of law. (Intel Corp. v. Hamidi (2003) 30 Cal.4th 1342, 1348; Guz v. Bechtel National, Inc. (2000) 24 Cal.4th 317, 334; Code Civ. Proc., § 437c, subd. (c).)

II. Overview of the California Regulations Governing the Executive Exemption

The Industrial Welfare Commission (IWC) “‘is the state agency empowered to formulate regulations (known as wage orders) governing employment in the State of California.” (Tidewater [Marine Western, Inc. v. Bradshaw (1996) 14 Cal.4th 557] at p. 561, citing Lab. Code, §§ 1173, 1178.3, 1182.)” (Morillion v. Royal Packing Co. (2000) 22 Cal.4th 575, 581.) The IWC has promulgated different “wage orders” to apply to distinct groups of employees. (See Cal. Code Regs., tit. 8, §§ 11010-11170.)

The parties in this case agree the executive exemption in either Wage Order 4-2001 or Wage Order 7-2001 controls this case. Wage Order 7-2001 regulates wages, hours and working conditions in the mercantile industry. The “mercantile industry” is defined as “any industry, business, or establishment operated for the purpose of purchasing, selling, or distributing goods or commodities at wholesale or retail; or for the purpose of renting goods or commodities.” (Cal. Code Regs., tit. 8, § 11070, subd. 2(H).) Wage Order 7-2001 applies to all persons in the mercantile industry, however paid, except “persons employed in administrative, executive, or professional capacities.” (Cal. Code Regs., tit. 8, § 11070, subd. 1(A).)

Wage Order 4-2001 applies to the wages, hours and working conditions in professional, technical, clerical, mechanical, and similar occupations. (Cal. Code Regs., tit. 8, § 11040, 1.) The definition of “professional, technical, clerical, mechanical, and similar occupations” neither expressly includes nor expressly excludes pharmacists. (Cal. Code Regs., tit. 8, § 11040, subd. 2(O).) Wage Order 4-2001 applies to these types of workers, however paid, except for “persons employed in administrative, executive, or professional capacities.” (Cal. Code Regs., tit. 8, § 11040, subd. 1(A).)

This case concerns only the executive exemption because pharmacists are statutorily excluded from the professional exemption, (Lab. Code, § 1186) and the parties have raised no issue regarding the administrative exemption. It is thus immaterial which wage order actually applies to pharmacists because both Wage Order 4-2001 and Wage Order 7-2001 contain identical criteria for determining whether an employee qualifies as an exempt executive. These wage orders direct, “[t]he following requirements shall apply in determining whether an employee’s duties meet the test to qualify for an exemption from those sections [regulating wages, hours and working conditions].

Labor Code section 1186 states: “A person employed in the practice of pharmacy is not exempt from coverage under any provision of the orders of the Industrial Welfare Commission unless he or she individually meets the criteria established for exemption as executive or administrative employees. No person employed in the practice of pharmacy may be subject to any exemption from coverage under the orders of the Industrial Welfare Commission established for professional employees.” (Italics added.)

“(1) Executive Exemption. A person employed in an executive capacity means any employee:

“(a) Whose duties and responsibilities involve the management of the enterprise in which he/she is employed or of a customarily recognized department or subdivision thereof; and

“(b) Who customarily and regularly directs the work of two or more other employees therein; and

“(c) Who has the authority to hire or fire other employees or whose suggestions and recommendations as to the hiring or firing and as to the advancement and promotion or any other change of status of other employees will be given particular weight; and

“(d) Who customarily and regularly exercises discretion and independent judgment; and

“(e) Who is primarily engaged in duties which meet the test of the exemption. The activities constituting exempt work and non-exempt work shall be construed in the same manner as such items are construed in the following regulations under the Fair Labor Standards Act effective as of the date of this order: 29 C.F.R. Sections 541.102, 541.104-111, and 541.115-116. Exempt work shall include, for example, all work that is directly and closely related to exempt work and work which is properly viewed as a means for carrying out exempt functions. The work actually performed by the employee during the course of the workweek must, first and foremost, be examined and the amount of time the employee spends on such work, together with the employer’s realistic expectations and the realistic requirements of the job, shall be considered in determining whether the employee satisfies this requirement.

“(f) Such an employee must also earn a monthly salary equivalent to no less than two (2) times the state minimum wage for full-time employment. Full-time employment is defined in Labor Code Section 515(c) as 40 hours per week.” (Cal. Code Regs., tit. 8, § 11070, subd. 1(A)(1), § 11040, subd. 1(A)(1).)

Labor Code section 515 states that for an exemption to apply the employee must be “primarily engaged” in exempt duties, defined as exempt duties consuming “more than one-half of the employee’s worktime.” (Lab. Code, § 515, subds. (a) and (e); see also, Cal. Code Regs., tit. 8, § 11040, subd. 2(N) and § 11070, subd. 2(K).)

III. Individualized Assessment of the Executive Exemption Requirements

Labor Code section 1186 expressly excludes pharmacists from the professional exemption and further states a pharmacist is nonexempt “unless he or she individually meets the criteria established for exemption as executive or administrative employees.” (Italics added.) This section thus requires an individualized assessment of Okura’s actual job functions as they relate to each of the criteria for the executive exemption.

The undisputed facts concerning the specific circumstances of Okura’s employment as outpatient manager of the Glendale pharmacy indisputably show he satisfied five of the six requirements to qualify for the executive exemption. Okura makes no argument to the contrary:

(1) Okura regularly directed the work of two or more other employees.

(2) Okura had the authority to hire and fire other employees.

(3) Okura had to regularly exercise discretion and independent judgment.

(4) Okura’s duties and responsibilities involved management of the pharmacy.

(5) Okura’s salary exceeded the statutory minimum of twice the minimum wage for full-time employment.

The remaining question is whether Okura spent more than one-half of his work time on exempt duties to qualify for the executive exemption. (Lab. Code, § 515, subd. (e).) Okura stated he spent on average 35 hours a week on the line “checking.” This quantity of hours suggests he was “primarily engaged in” “checking.” (Lab Code, § 515, subd. (a).) These facts thus require us to determine whether his “checking” is nonexempt production work, as distinct from exempt managerial work, or directly and closely related to exempt work, to qualify for the executive exemption. (Cal. Code Regs., tit. 8, § 11070, subd. 1(A)(1)(e), § 11040, subd. 1(A)(1)(e).)

The IWC has promulgated no regulations specially applying to pharmacists. (IWC “Statement as to the Basis” regarding wage orders adopted in 2000, § 1 Applicability of Order [“The IWC does not have the power to repeal Labor Code § . . . 1186, which explicitly require[s] that . . . pharmacists individually meet the administrative or executive criteria in order to qualify for an exemption. Accordingly, the IWC chose not to address regulations relating to . . . pharmacists”].) Nor has any decision of which we are aware discussed the executive exemption as it may apply to pharmacists.

De Jesus-Rentas v. Baxter Pharmacy Services Corp. (1st Cir. 2005) 400 F.3d 72, 75, held pharmacists were exempt professionals because they routinely exercised discretion and judgment in evaluating the safety and propriety of prescriptions for particular patients and because they supervised the work of pharmacy assistants. This decision does not assist us because, although professionals, in California pharmacists are expressly excluded from the professional exemption by statute. (Lab. Code, § 1186.)

Kaiser urges this court to accept a rule of universal application that the act of verifying the accuracy of pharmacy subordinates’ work in filling prescriptions, or “checking,” is supervisory and thus per se an exempt management task.

Decisions Kaiser offers in support of such a rule are not directly on point. They were decided under a federal regulation (29 C.F.R. § 541.103) construing and applying the federal “primary duty” test. (See, e.g., Sturm v. TOC Retail, Inc. (M.D. Ga. 1994) 864 F.Supp. 1346, 1352-1354 [husband and wife team who managed a small market were exempt executives because, although they performed the same tasks as nonexempt employees, their primary duty, meaning the duty most important to the employer, was supervision to ensure company policies were being carried out]; Baldwin v. Trailer Inns, Inc. (9th Cir. 2001) 266 F.3d 1104, 1113-1117 [managers of trailer park were exempt executives because they exercised judgment and discretion and oversaw the work of two other persons, even though they spent more than 50 percent of their time on nonexempt duties also performed by assistant managers]; compare, Donovan v. Burger King Corp. (1st Cir. 1982) 672 F.2d 221, 227 [some assistant managers did not qualify for the executive exemption because they spent the vast majority of their time on menial tasks while the employees they supervised performed the same menial tasks].)

Okura and amici curiae argue for an equally broad rule. They contend that even if “checking” is a form of supervision, it can never be an exempt task in the business of pharmacy because “checking” cannot be considered simultaneously a nonexempt professional act and an exempt executive act. They further assert the broad interpretation Kaiser urges that supervision is per se exempt managerial work would automatically subject all pharmacists to the executive exemption simply because pharmacists are required by law to supervise the work of unlicensed pharmacy personnel. Such a rule, they claim, would have the effect of interfering with, if not wholly negating, the Legislature’s clear intent to exclude pharmacists from the professional exemption. (Lab. Code, § 1186.)

The trial court took judicial notice of the legislative history of former Labor Code section 4008.5, now 4115, which for the first time authorized the use of pharmacy techs in California. This court similarly granted the parties’ requests for judicial notice of these and additional legislative materials concerning the adoption of Labor Code section 1186 and revisions to IWC Wage Order 5-2000. (Evid. Code §§ 452, 459.) We agree with the trial court, this legislative background is of little if any assistance where, as here, the case does not turn on the proper interpretation of the statutes or wage order. (See Kaufman & Broad Communities, Inc. v. Performance Plastering, Inc. (2005) 133 Cal.App.4th 26, 29, 42 [resort to legislative history is appropriate only where statutory language is ambiguous; thus even where a motion for judicial notice is granted the panel deciding the case may ultimately find the reports uninstructive].)

Whether a pharmacist’s act of performing mandated “checking” of unlicensed personnel’s work in the production of filling a prescription—in the abstract—constitutes nonexempt production work or exempt supervisory management work is a close and intriguing question. However, there is no need to reach the broader question in this case. This is because Okura’s own testimony demonstrates the nature and quality of his “checking” was qualitatively different in purpose and effect from the statutorily mandated “checking” required of pharmacists in general.

When undertaking the required individualized assessment of Okura’s actual “checking” activities, the record establishes Okura spent the vast majority of his “checking” time overseeing the work of pharmacists who had already performed the statutorily mandated checking. In other words, Okura spent most of his time “checking the checkers” for management purposes. This second layer of scrutiny was not required by statute. Nor is there anything in the record to show double checking was a routine duty required of all pharmacists, or even of Kaiser’s managing pharmacists. As a conscientious pharmacy manager Okura undertook the extra burden of “rechecking,” or of “checking the checkers,” to make sure his pharmacy was operating efficiently and within the 15-minute guideline mandated—not by statute—but apparently by Kaiser policy.

Okura declared Kaiser never told him “checking” would be one of his tasks as an outpatient pharmacy manager. He also pointed out “checking” was not listed as a job requirement in the job description for the outpatient pharmacy manager position. Nor, he claimed, was “checking” an area of interest or concern in a comprehensive survey Kaiser performed concerning work typically performed by outpatient pharmacy managers. It is possible “checking” for as many hours a day as Okura did, as a manager of a medium to large pharmacy of the size Okura managed, may not have been within Kaiser’s realistic expectations of a manager of a medium to large outpatient Kaiser pharmacy.

Okura’s “checking” was primarily geared toward ensuring everyone on the line had performed his or her job properly—including the line pharmacists who performed most of the statutorily required “checking.” (See 29 C.F.R. § 541.108(e) [“a supervisor who spot checks and examines the work of his subordinates to determine whether they are performing their duties properly, and whether the product is satisfactory, is performing work which is directly and closely related to his managerial and supervisory functions”].) Okura testified that when he completed his “checking” he usually did not place his initials on the prescription label. He explained it was unnecessary to do so because a line pharmacist had already performed the statutorily mandated “checking” of unlicensed personnel’s work and had already placed his or her initials on the prescription label. Okura’s own statements showed he was usually not involved in performing the mandated “checking” of a line pharmacist in the production of filling prescriptions except on the rare occasion when all line pharmacists were otherwise occupied in consulting activities and the like. Okura did not quantify in minutes precisely how much time he spent on average per day filling in for pharmacy techs or line pharmacists.

Nor was Okura’s “checking” limited to reviewing the accuracy of the prescriptions filled by unlicensed pharmacy personnel. Okura used his “checking” as a management tool. He reviewed to make sure all prescriptions complied with Kaiser’s policy of being filled within 15 minutes. In the event it took longer than 15 minutes to fill a prescription, Okura stated he figured out what had caused the problem and made corrections to speed up the process. By monitoring the time it took to fill prescriptions he was engaging in management work by implementing Kaiser’s 15-minute policy. In addition, because he reviewed everyone’s work by double checking and overseeing the entire operation on the line, he learned which employees were making mistakes, the nature of those mistakes, and the measures he would have to take to correct them. He used a form on which he wrote the employee’s name, the particular error he or she made, and kept these records to “keep everyone on their toes.” The information he gleaned from his “rechecking” on the line helped Okura to carry out his management duty of preparing employee evaluations. (See 29 C.F.R. § 541.108(a) [regarding work “directly and closely related” to exempt management functions].) These particular tasks Okura performed related directly to the management of the pharmacy, distinct from the mandated checking done by all pharmacists of unlicensed pharmacy personnel in the production of filling prescriptions.

Our conclusion that Okura was “primarily engaged in” (Lab Code, § 515, subd. (a)) management tasks when “rechecking” only applies to Okura. What might occur in a different, or smaller, Kaiser pharmacy is not at issue in this case and we assess only Okura’s job duties.

IV. Adequacy of Kaiser’s Separate Statement of Undisputed Fact

Okura attempts to avoid the conclusion he was primarily engaged in exempt management tasks. He asserts even if the record facts are not reasonably in dispute they may not be relied on to affirm the judgment because Kaiser did not separately list each of these facts in its separate statement of undisputed fact. We disagree.

The failure to include all material undisputed facts in the separate statement “may in the court’s discretion constitute a sufficient ground for denial of the motion.” (Code Civ. Proc., § 437c, subd. (b)(1).) The statute is permissive, not mandatory. What this means is facts stated elsewhere than in the separate statement need not be considered by the court. However, the decision “[w]hether to consider evidence not referenced in the moving party’s separate statement rests with the sound discretion of the trial court, . . . ” (San Diego Watercrafts, Inc. v. Wells Fargo Bank, N.A. (2002) 102 Cal.App.4th 308, 316; accord, Zimmerman, Rosenfeld, Gersh & Leeds LLP v. Larson (2005) 131 Cal.App.4th 1466, 1478; compare, Kulesa v. Castleberry (1996) 47 Cal.App.4th 103, 113 [trial court must consider all of the evidence set forth in the papers].)

The trial court acted well within its discretion in considering facts presented through Okura’s own sworn testimony although each fact did not appear in Kaiser’s separate statement of undisputed fact. Notably, the parties briefed the factual issues in the trial court. In addition, the facts omitted from Kaiser’s separate statement pertained to crucial, dispositive matters. Furthermore, because the source of the omitted facts was Okura himself they were not reasonably subject to dispute. (See Crawford v. Alioto (1951) 105 Cal.App.2d 45, 50 [“A declaration by a litigant contrary to his position in the lawsuit is . . . positive evidence, that is to say, it is evidence which tends to prove the truth of the matter admitted.”]; see also, Evid. Code, § 1220 [party admissions].) Okura explained the nature and purpose of his “rechecking” through sworn deposition testimony and a declaration signed under penalty of perjury. In these circumstances, we find no abuse of discretion. (San Diego Watercrafts, Inc. v. Wells Fargo Bank, N.A., supra, 102 Cal.App.4th at p. 316 [“we review the decision to consider or not consider this evidence for an abuse of discretion”].)

DISPOSITION

The judgment is affirmed. Kaiser is awarded its costs on appeal.

We concur: MALLANO, P. J. ROTHSCHILD, J.

The federal “primary duty” test, found in title 29 of the Code of Federal Regulations, section 541.103, is not a part of the executive exemption in California. The IWC wage orders instead require that to be exempt the employee must not only have as his or her “primary duty” exempt tasks, but must also spend more than 50 percent of his or her worktime on exempt tasks. Under title 29 Code of Federal Regulations, section 541.103, an employee could still have management as his or her “primary duty” even though he or she spent less than 50 percent of his or her workday on management functions. Thus, cases applying and construing this federal regulation are of little if any assistance in construing California wage orders providing employees greater protection. (See Morillion v. Royal Packing Co., supra, 22 Cal.4th at p. 592 [warning against relying on federal regulations which provide employees less protection than under California law]; Ramirez v. Yosemite Water Co., Inc. (1999) 20 Cal.4th 785, 794-795 [noting states are entitled to adopt labor laws more protective of employees than the federal regulations].)


Summaries of

Okura v. Kaiser Foundation Health Plan Inc.

California Court of Appeals, Second District, First Division
Jul 29, 2008
No. B196372 (Cal. Ct. App. Jul. 29, 2008)
Case details for

Okura v. Kaiser Foundation Health Plan Inc.

Case Details

Full title:JOHN OKURA, Plaintiff and Appellant, v. KAISER FOUNDATION HEALTH PLAN…

Court:California Court of Appeals, Second District, First Division

Date published: Jul 29, 2008

Citations

No. B196372 (Cal. Ct. App. Jul. 29, 2008)