Grande v. Eisenhower Med. Ctr., 44 Cal. App. 5th 1147 (2020)

Lynn Grande was assigned through a temporary staffing agency (FlexCare) to work as a nurse at Eisenhower Medical Center. Grande was a named plaintiff in a class action prosecuted against FlexCare in which she alleged she had not received her required meal and rest breaks, wages for certain periods she had worked and overtime wages. A year after FlexCare settled with the class (including Grande), Grande brought a second class action alleging the same violations against Eisenhower, which was not a party to the original class action. The trial court held a trial limited to the questions of whether Eisenhower was a released party as a result of the settlement agreement and/or whether Eisenhower and FlexCare were in privity such that Grande’s claims against Eisenhower were barred by the prior action against FlexCare. The trial court ruled in Grande’s favor, and the Court of Appeal affirmed, holding that because the release did not include words such as “clients, joint employers, joint obligors” of FlexCare or reference to “any client of FlexCare as to whom any class member may have provided services through FlexCare,” Eisenhower was not among the “Released Parties.” The Court further held that FlexCare and Eisenhower were not in privity with one another because joint employers are generally not liable for each other’s Labor Code violations (following Serrano v. Aerotek, Inc., 21 Cal. App. 5th 773 (2018) from the Fourth Appellate District and refusing to follow Castillo v. Glenair, Inc., 23 Cal. App. 5th 262 (2018) from the Second Appellate District). (Note that the second holding drew a dissent from Presiding Justice Ramirez.)