Protecting Both Business Finances And Futures

Breaking News: BKCG Gets Big Win For Ralphs In COVID-19 Class Action Lawsuit!

In a case in which the plaintiffs sought and received local and national media attention, the Los Angeles Superior Court agreed with BKCG lawyers and dismissed class action claims of employees of Ralphs’s Compton distribution center, a major cog in the Southern California food supply. As an essential services business, the distribution center has remained open during the pandemic and received and implemented guidance from the CDC, Cal/OSHA and the Los Angeles Department of Public Health on preventing the spread of COVID-19 at the workplace.

Ralphs implemented protective measures and conducted contact tracing as guidance from the expert agencies evolved, but the agency guidance for Ralphs’s business was not released until after almost 100 of the approximately 800 distribution center employees had already tested positive for COVID-19. Ralphs’s protective measures and contact tracing quickly gained traction, and there were only a handful of new positive tests in June. The rate of positive tests has slowed to a trickle, as only two employees have tested positive for COVID-19 since the beginning of August.

The facts did not stop a group of opportunistic employees – some of whom, ironically, are repeat violators of the social distancing and protective measures Ralphs adopted and posted in signs throughout its facility – from seeking a windfall disguised in a plea for justice and immediate action. In July, these employees sued Ralphs and sought injunctive relief under theories of public nuisance, declaratory relief, and unfair competition.

Before BKCG could challenge the lawsuit on Ralphs’s behalf, the plaintiffs made an ex parte application for a temporary restraining order which asked the Court to be a watchdog over Ralphs’s protective measures and safeguards. The Court denied their request based upon overwhelming evidence, assembled by a team of BKCG attorneys and Ralphs representatives on short notice, that Ralphs’ safeguards were preventing the spread of COVID-19 at the distribution center. The plaintiffs subsequently abandoned their efforts to obtain pre-trial injunctive relief.

After the plaintiffs filed an amended complaint, BKCG filed a demurrer asking the Court to dismiss the claims seeking injunctive relief under the theory of judicial abstention, which states that a court may refuse to take a case that seeks equitable relief if granted that relief would require the court to assume, or interfere with, the functions of an administrative agency. The trial court agreed with BKCG and held that it would be required “to determine and then to impose a certain standard for, say, the number of masks that must be provided to each employee, when a ‘high touch’ surface has been adequately disinfected, or when an employer has provided ‘proper postings.’”

The court recognized that it “would likely be called upon to create guidelines for how a distribution center should be properly run during a global pandemic” and that its efforts could “improperly interfere with the functions of administrative agencies like Cal/OSHA and the Los Angeles Department of Public Health.” The trial court also took judicial notice of communications between Ralphs and these public agencies which demonstrated that the agencies had exercised their jurisdictional authority to investigate the conditions at the distribution center. Notably, none of the agencies cited Ralphs for violation of any prevailing guidance or instruction, and Cal/OSHA issued a “Notice of No Violation After Inspection” on July 2, 2020.

After the Court’s ruling, the lawsuit that remains looks nothing like the one that plaintiffs rushed to court with in July amidst a media blitz and a flurry of press releases. With all of their equitable claims for injunctive relief having been dismissed without leave to amend, plaintiffs have only the alleged compensatory damages of the girlfriend of one of the former plaintiff employees, who claims that she contracted COVID-19 from him and can only recover under a tenuous public nuisance theory, and a vaguely alleged claim that Ralphs’s attendance policy gives employees the “feeling” that they have to report to work even if they felt sick, even though the policy and literally dozens of signs throughout the distribution center expressly state the opposite. These claims are subject to further challenges at the pleadings stage, and BKCG will continue to push for their elimination. Regardless of their eventual outcome, the plaintiffs’ effort to strong-arm Ralphs with the threatened closure of this critical distribution center was, itself, shut down by the court.

Please contact Daniel Kessler or Michael Oberbeck at [email protected] and [email protected] or call (949) 975-7500 if you have any questions regarding COVID related claims against your business.