Avery v. TEKsystems, Inc.

Summary

The United States District Court for the Northern District of California grants Plaintiffs’ motion to sever and remand their California Unfair Competition Law claim to state court. The court concludes that Plaintiffs have an adequate legal remedy through their Labor Code claims and therefore lack equitable jurisdiction over the UCL restitution claim; Plaintiffs also disavow injunctive relief. The court amends the certified class definition to begin on January 28, 2019, and orders supplemental notice to Recruiters excluded from the amended class.

Holdings

1. A federal court lacks equitable jurisdiction over a UCL restitution claim when the plaintiff has an adequate legal remedy for the same harm through Labor Code claims, even if the legal claims have a shorter limitations period.
2. When a removed case lacks equitable jurisdiction and the defendant does not seek dismissal, the district court may sever and remand the equitable claim to state court.
3. The court may amend the certified class definition to begin on January 28, 2019, excluding members who can obtain relief only under the remanded UCL claim, when the change does not alter the reasoning underlying the certification order.

Questions Presented

1. Whether the federal court had equitable jurisdiction over Plaintiffs' UCL restitution claim when Plaintiffs had an adequate remedy at law through their California Labor Code claims.
2. Whether the UCL claim should be severed and remanded to state court rather than dismissed.
3. Whether the certified class definition should be amended to remove Recruiters whose employment ended before January 28, 2019 and who therefore relied on the UCL's longer limitations period.

Disposition

remanded