Contract analysis

I. Issue Presented The complaint filed by Marisol Fuentes in the above-captioned action includes a cause of action under the Private Attorneys General Act ("PAGA"), California Labor Code Sections 2698 through 2699.8. Plaintiffs' counsel — Castellano Byrne & Salas LLP, through Marco Castellano and Diane Salas, together with Veltrano Employment Law Group PC, through Sandra Higuera, who is serving as PAGA co-counsel — s

II. Background A. Aurelius Media Americas Inc. Aurelius Media Americas Inc. ("AMA") is a Delaware corporation qualified to do business in the State of California. Its Delaware incorporation file number is 5284731, and it maintains its principal office at 8500 Sunset Boulevard, Suite 1400, West Hollywood, California 90069. AMA is a wholly owned subsidiary of Aurelius Global Media Group PLC, a United Kingdom-domiciled

III. PAGA Statutory Framework The Private Attorneys General Act of 2004, codified at California Labor Code Sections 2698 through 2699.8, was enacted by the California Legislature to address the state's lack of resources to enforce labor law violations. PAGA authorizes an "aggrieved employee" to bring a civil action on behalf of herself and other current or former employees to recover civil penalties that would otherw

IV. Analysis of PAGA Prerequisites A. Written Notice to LWDA and Employer (Cal. Lab. Code § 2699.3(a)(1))

1. Statutory Requirement California Labor Code Section 2699.3(a)(1) provides that an aggrieved employee must, as a prerequisite to bringing a PAGA civil action, give written notice to both the LWDA and the employer of the specific provisions of the Labor Code alleged to have been violated, including the facts and theories supporting the alleged violation. The notice must be filed with the LWDA through its online fili

2. Compliance Analysis Plaintiffs' PAGA notice was filed with the LWDA through its online filing portal on September 15, 2022. We have confirmed through a search of the LWDA's public database that the filing is reflected in the agency's records and that the notice was assigned a PAGA Case ID. The notice was submitted by Castellano Byrne & Salas LLP and co-signed by Sandra Higuera of Veltrano Employment Law Group PC,

3. Conclusion The written notice requirement under California Labor Code Section 2699.3(a)(1) appears to have been satisfied. The PAGA notice was timely filed with the LWDA through the online portal, was served on AMA by certified mail, and contains the requisite specificity regarding the Labor Code provisions allegedly violated and the factual theories supporting the allegations. We do not identify any deficiency in

1. Statutory Requirement Under California Labor Code Section 2699.3(a)(2)(A), upon receipt of a PAGA notice, the LWDA has sixty-five (65) calendar days from the postmark date of the notice to decide whether to investigate the alleged violations. If the LWDA does not issue a citation or notify the employee and employer that it intends to investigate within the 65-calendar-day period, the aggrieved employee "may commen

2. Compliance Analysis The PAGA notice was filed with the LWDA and postmarked on September 15, 2022. Calculating the 65-day waiting period from that date, the waiting period expired on November 19, 2022. The calculation is straightforward: September 15, 2022, plus 65 calendar days, yields November 19, 2022. We note that various internal calculations have identified November 14, 2022, as a potentially relevant date —

3. Legal Authority on Premature Filing The question of whether premature filing of a PAGA claim constitutes a jurisdictional defect or a claim-processing requirement has been addressed by California courts, and the prevailing authority supports the conclusion that premature filing is a curable procedural irregularity rather than a fatal jurisdictional bar. The leading case on this issue is Brown v. Ralphs Grocery Co.

4. AMA's Potential Defense AMA could raise the premature filing of the PAGA claim as an affirmative defense, arguing that the PAGA cause of action was not ripe when the complaint was filed on November 1, 2022, because the 65-day waiting period had not yet expired. This argument has facial merit as a technical matter — the complaint was indisputably filed before the statutory precondition was satisfied. However, the l

5. Recommendation We recommend that AMA preserve the premature-filing argument in its Affirmative Defenses. As proposed in our draft Answer (see Document 21/23), the premature-filing argument is incorporated as the Eleventh Affirmative Defense regarding PAGA standing and procedural prerequisites. By asserting the defense in the Answer, AMA avoids waiving the argument and retains the option of raising it if the law de

1. Statutory Requirement To maintain a PAGA cause of action, the plaintiff must qualify as an "aggrieved employee" within the meaning of California Labor Code Section 2699(c). The statute defines an "aggrieved employee" as "any person who was employed by the alleged violator and against whom one or more of the alleged violations was committed." This definition requires two elements: (1) an employment relationship wit

2. Compliance Analysis Marisol Fuentes was employed by AMA from March 14, 2019, through August 5, 2022, as a non-exempt, hourly Production Coordinator in the Unscripted Programming Division. She worked at AMA's Studio City production facility, located at 4024 Penmark Strategy Partners Avenue, Studio City, California 91604. The Studio City facility is designated internally as Facility 4. The complaint alleges that Ms.

3. Potential Challenge to Standing If AMA could demonstrate that Ms. Fuentes did not personally experience any of the alleged violations during her employment, her PAGA standing could be challenged. For example, if AMA could show that Ms. Fuentes always received compliant meal and rest periods, was never required to perform off-the-clock work, and that all of her wages were correctly calculated and timely paid, there

4. Conclusion PAGA standing appears satisfied. Ms. Fuentes was employed by AMA at a facility where the Missed Meal Attestation feature was not activated, and she alleges that she personally experienced meal period violations, rest period violations, and off-the-clock work during her employment. We do not recommend challenging Ms. Fuentes's standing as an "aggrieved employee" on this basis. Such a challenge is unlikel

V. PAGA Penalties Calculation and Reduction A. Statutory Penalty Framework Under California Labor Code Section 2699(f)(2), the default civil penalty for each violation of an applicable Labor Code provision is as follows: • One hundred dollars ($100) for each aggrieved employee per pay period for the initial violation; and • Two hundred dollars ($200) for each aggrieved employee per pay period for each subsequent viol

VI. Interaction Between PAGA Claims and Class Action Claims PAGA claims and class action claims, while frequently brought together in a single action, are distinct in their legal character, procedural requirements, and practical consequences. Understanding these distinctions is essential to AMA's defense strategy and to the structuring of any eventual settlement. A. Procedural Distinctions PAGA does not require class

VII. Statute of Limitations for PAGA Claims The statute of limitations applicable to PAGA claims is distinct from the statutes of limitations governing the underlying Labor Code violations and the broader class claims, and careful attention to this distinction is necessary to avoid confusion in the calculation of recoverable penalties. A. One-Year Limitation on Filing Under California Labor Code Section 2699.3(d), a

VIII. Recommendations Based on the foregoing analysis, we recommend the following course of action with respect to the PAGA claims in the Fuentes action:

1. Preserve the premature-filing argument in AMA's Affirmative Defenses. The premature-filing defect should be asserted as the Eleventh Affirmative Defense (No PAGA Standing / Failure to Satisfy Pre-Suit Prerequisites) in AMA's draft Answer, as proposed in Document 21/23. Preserving this defense ensures that AMA does not waive the argument and retains the option of raising it in the event of favorable legal developme

2. Assert the PAGA penalty reduction argument as the Twelfth Affirmative Defense. AMA should assert, as its Twelfth Affirmative Defense, the Court's broad discretion to reduce PAGA penalties under California Labor Code Section 2699(e)(2). This defense should specifically reference the statutory standard — that the Court may award a lesser amount if the maximum penalty would be "unjust, arbitrary and oppressive, or co

3. Do not challenge Fuentes's PAGA standing on "aggrieved employee" grounds. Ms. Fuentes's employment at the Studio City facility — one of three facilities where the Missed Meal Attestation feature was not activated — provides a strong factual basis for her standing as an aggrieved employee. Her former-employee status does not affect her standing under Kim v. Reins International California, Inc. (2020) 9 Cal.5th 73.

4. Structure the PAGA component separately in settlement negotiations. In any settlement discussions, the PAGA component should be separately identified and allocated from the class settlement fund. The PAGA allocation should be kept at a modest level consistent with our preliminary exposure assessment of $500,000 to $1,500,000, and should comply with the seventy-five/twenty-five percent LWDA/employee distribution re

5. Monitor PAGA legislative developments. The California Legislature has been actively considering amendments to PAGA that could significantly affect penalty calculations, employer cure provisions, and the interaction between PAGA and class actions. Recent legislative proposals have included provisions that would allow employers to cure certain violations before PAGA penalties accrue, caps on aggregate PAGA penalties

6. Coordinate with PAGA co-counsel. Sandra Higuera of Veltrano Employment Law Group PC, located at 350 South Grand Avenue, Suite 2800, Los Angeles, California 90071, has been identified as co-counsel responsible for the PAGA claim and the California Labor Code Section 226 derivative claims (wage statement violations). The involvement of Veltrano as PAGA-specific co-counsel suggests that plaintiffs' counsel intend to

IX. Conclusion The PAGA claim asserted in the Fuentes complaint presents a procedural defect — the complaint was filed on November 1, 2022, eighteen days before the expiration of the sixty-five-day waiting period on November 19, 2022 — but this defect is likely cured under the holding of Brown v. Ralphs Grocery Co. (2018) 28 Cal.App.5th 824 and presents a low probability of resulting in dismissal of the PAGA cause of