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1 TIMOTHY J. LONG (STATEBARNO. 137591)
tjlong(^orrick.com
2 NICHOLAS J. HORTON (STATE BAR NO. 289417)
3
nhorton(gorrick.coin
AVALON JOHNSON FITZGERALD (STATE BAR NO. 288167) FlLED/ENDORSE
afitzgerald@orrick.com
4 ORRICK. HERRINGTON & SUTCLIFFE LLP JAN 3 0 2019_
-400 6yr4uiMall, Suite .^SOO - ' - L—.
—
5 Sacramento, CA 95814-4497 J, Carrisosa
Telephone: +1916 447 8299 By;
6 Facsimile: +1 916 329 4900
7 Attomeys for Defendant
HEALTH NET OF CALIFORNIA, INC.
SUPERIOR COURT OF THE STATE OF CALIFORNIA
9
COUNTY OF SACRAMENTO
10
11 ANDREA SPEARS, an individual, on behalf of Case No. 34-2017-00210560-CU-OE-GDS
herself and on behalf of all persons similarly
12 situated, REPLY SEPARATE STATEMENT OF
UNDISPUTED MATERIAL FACTS IN
13 Plaintiff, SUPPORT OF DEFENDANT HEALTH
NET OF CALIFORNIA, INC.'S
14 RENEWED MOTION FOR SUMMARY
V.
ADJUDICATION
15 HEALTH NET OF CALIFORNIA, INC., a
California Corporation; and Does I through 50, Date: February 4. 2019
16 inclusive. Time: 9:00 a.m.
Dept.: 54
17 Defendants.
18 Reservation No.: 2380178
19 Complaint Filed: April 5.2017
FAC Filed: June 29, 2017
20 Consolidated Complaint Filed: Dec. 2, 2017
21 TOMAS R. ARANA, on behalf of himself, all Complaint Filed: August 1,2017
others similarly situated,
22
Plaintiff
23
V.
24
HEALTH NET OF CALIFORNIA, INC., a
25
California corporation; and DOES 1-50,
26 inclusive,
27 Defendant.
28
REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S
RENEWED MOTION FOR SUMMARY ADJUDICATION
1 Defendant Health Net of California, Inc. ("HNCA") submits the following Reply to
2 Plaintiff Andrea Spears' ("Spears") Responsive.Separate Statement of Undisputed Material Facts
3 in Opposition to HNCA's Renewed Motion for Summary Adjudication. Spears has failed to
1 submit evidence sufficient to dispute the material facts set forth in HNCA's..Separate Statement.
5 Accordingly, HNCA is entitled to summary adjudication.
6 Spears' Responsive Separate Statement is largely non-responsive. It is replete with
7 statements unrelated to the particular Undisputed Fact at issue, deliberate mischaracterizations of
8 facts and evidence, and relies upon speculation, guesswork, and mere possibilities. Such
9 "evidence" is insufficient to controvert HNCA's evidence. See Doe v. Salesian Sac, 159 Cal.
10 App. 4th 474, 481 (2008). Moreover, Spears includes additional facts in her responses to
11 HNCA's Undisputed Facts. This is wholly improper. Spears was obligated to "set forth plainly
12 and concisely any other material facts [she] contends are disputed," rather than include these
13 purported additional facts in her response to unrelated Undisputed Facts set forth by HNCA. Cal.
14 Civ. Code. § 437c(b)(3); see also Cal. Rules of Court, Rule 3.1350(f)(3).
15 For the Court's convenience, HNCA endeavors to respond as succinctly as possible to
16 Spears' voluminous and redundant, yet mischaracterized and inadequate, evidence.
17 SEPARATE STATEMENT OF UNDISPUTED FACTS AND EVIDENCE
18 1. THIRD CAUSE OF ACTION FOR FAILURE TO PAY HOURLY WAGES AND
FAILURE TO PAY OVERTIME WAGES
19
Issue 1: Plaintiffs' Failure to Pay Overtime Wages claim premised on HNCA's alleged
20 failure to include cash benefits received pursuant to a bona fide benefits Plan
in Plaintiff Spears' regular rate of pay fails because cash benefits were
21 properly excluded from her regular rate calculation under the Benefit-Plan
Contributions Exception and Plaintiff Arana never received the cash benefit.
22
23 i Undisputed : " • Pl^ihtifrs Response and Supporting Defendant's Reply to
; M Evidence: Plaintiffs Response
24 : and Supporting
? Evidence:
25 1. Plaintiff Spears 1. Undisputed 1. Undisputed.
worked as a
26 non-exempt
HNCA
27 Customer
Service
28
REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S
RENEWED MOTION FOR SUMMARY ADJUDICATION
1 Undisputed^if^ Plaintifrs Response and Supporting Defendant's Reply to
Material Facts '' Evidence: '. .^i^sc;?"? .- Plaintifrs Response
2 and Supporting
Evidence:
3 Representative
from September
4 2014'to October
3--
2016 in Rancho
5 Cordova.
6 Declaration of
Diane C. Rodes
7 (hereinafter "Rodes
Dec") ^4.
8 2. Plaintiff Arana Undisputed. 2. Undisputed.
began working
9 out of the
Rancho
10 Cordova call
center in 2008
11 and continues
to work there
12 now. He
started as a
13 non-exempt
Customer
14 Service
Representative
15 for HNCA until
his promotion
16 on or about
November 14,
17 2015 to Contact
Center Analyst,
18 an exempt
position. Since
19 June 2017,
Plaintiff Arana
20 has been
working as a
21 Call Center
Systems
22 Analyst 1, also
an exempt
23 position.
24
Rodes Dec, H 6.
25 3. Between 3. Disputed as incomplete. 3. Undisputed.
January 1, 2001 Plaintiff provides no
26 and December evidence to dispute this
31,2016, HNI fact.
27 sponsored a
28
-2-
REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S
RENEWED MOTION FOR SUMMARY ADJUDICATION
Undisputed PlaintitTs Response and Supporting Defendant's Reply to
Material Facts Evidence: «Plaintiffs Response
2 and Supporting
Evidence:
•3
cafeteria plan - Defendant's Plan provided medical benefits, but HNCA did not pay any
a written health Defendant also provided cash payments directly cash benefits directly to
,4 and welfare " tq employees who'waived their right to medical Spea£s because she
plan-'called benefits and tHFplan was not ado'pted not just authorizedTTNI, not
5 the "Health "for the benefit of its employees" but rather was HNCA to deposit money
Net, Inc. part of Defendant's effort "to provide associates directly into her bank
6 Associates with a competitive benefits program that is part account.
Benefit of our total remuneration plan."
7 Program" (the (Reply Declaration of
"Plan"). (See Exhibit 3. 2011 -2015 Summary Plan Diane Rodes ("Rodes
8
Description at p. 1; Exhibit 4 2016 Summary Reply Dec"), Ex. A.)
9 Declaration of Plan Description at p. 1.)
Debbie Colia HNCA does not dispute
10 ("Colia Dec"), (See also Exhibit 3 at HNCA000921; Exhibit 4 that the Plan provided for
Tl 2-3, Exhs. A-I. at HNCA000764 ["To help you pay for the cost medical benefits and
11 of your benefits under the Health Net, Inc. cash benefits; however
Associate Benefits Program, your Employer neither this "facf nor the
12 provides you with 'Flex Dollars' that you can cited evidence
use to pay for the cost of your optional benefits. contradicts UF 3.
13 In most cases, if you use these Flex Dollars to Instead this fact supports
pay for before-tax benefits, these Flex Dollars a finding that the Plan
14 will be tax free to you. ... If you waive coverage was a cafeteria style
or you have Flex Dollars left over after you pay plan.
-1>5- the cost ofall of the optional benefits you elect,-,
you will receive a portion of your Flex Dollars Cafeteria benefit plans
16 as cash in your paycheck and you will be taxed must offer benefit
on this amount."].) options for its
17 Participants to choose
(See also Exhibit 3 at HNCA000916; Exhibit 4 from, one of which must
18 at HNCA000755 [describing the term be a taxable cash benefit.
"employer" in the Health Plan as the party that See IRS Code, section
19 pays the cash for waived medical benefits as 125. As such, the
Defendant says: "You will see the terms 'Health offering of a cash benefit
20 Net' and 'the Company' used throughout this cannot be used as a basis
SPD to refer to Health Net, Inc. and all to dispute whether the
21 participating companies. The term 'Employer' benefits plan was a
is used in this SPD to refer to the company cafeteria plan. Further,
22 which is your direct employer."].) Plaintiff does not dispute
that IRS Code, section
23 (See also Exhibit 3 at HNCA000916; Exhibit 4 125 governs the Plan.
at page HNCA000755 [describing the plan as See UF 6.
24 resulting from Defendant's effort to "provide
associates with a competitive benefits program
25 that is part of [Defendant's] total remuneration
plan."].)
26
27 (See also Exhibit 6. PMK Deposition at 61:10-
18 [cash payments for waiving benefits are
28 directiy deposited into Plaintiffs bank account
-3 -
REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S
RENEWED MOTION FOR SUMMARY ADJUDICATION
Undisputed Plaintifrs Response and Supporting : Defendant's Reply to:>
Material FactS; } Evidence: ;„/.;;•.:•;''•',••'• Plaintiffs Response ;^
2 and Supporting
Evidence':-'v-l v'
3 in wage statement of taxed wages by Defendant
directly to Plaintiff].)
4
Cash payments for waiving benefits were only Neitlier this.fact nor the ~ .
5 provided when the actual medical or dental cited evidence
benefits were waived and the employee did not contradicts UF 3, but
6 receive medical or dental coverage through the instead supports a
Plan. finding that the Plan was
7 a cafeteria style plan.
(Exhibit 5. Colia Depo.. 96:2-8. 137:10-161
8 4. As the Plan 4. Disputed and objection as vague and 4. Undisputed.
sponsor, HNI ambiguous as to the terms "sponsor" and Plaintiff provides no
9 administered "administered the plan." evidence to dispute this
the Plan. fact.
10
Colia Dec, TI 2.
11
Defendant paid cash payments for employees The Plan was the only
12 who opted out of receiving medical benefits. mechanism by which
To the extent Defendant refers to "administered Flex Dollars could have
13 the plan" as including paying cash in lieu of been paid to Spears,
benefit payments, then the fact is DISPUTED including the portion of
14 because the plan documents do not say that the Flex Dollars she received
cash is paid by a third party and, to the contrary, as cash for waiving
15 the plan documents say that Pefendant as the medical coverage..
employer is a first party not a third party who is Further, nothing in the
16 making the payments directly to Plaintiff. Plan documents
contradicts the
17 (See Exhibit 3 at HNCA000916; Exhibit 4 at undisputed testimony
HNCA000755 ["You will see the terms 'Health that HNCA irrevocably
Net' and 'the Company' used throughout this contributed the total cost
18 of benefits, including the
SPD to refer to Health Net, Inc. and all
participating companies. The term 'Employer' cash benefits at issue in
19 this motion, to the Plan
is used in this SPD to refer to the company
which is your direct employer."].) as set forth in UF 20.
20
21 (See Exhibit 3 at HNCA000921; Exhibit 4 at ITNCA was not
page HNCA000764 ["To help you pay for the authorized to directly
22 cost of your benefits under the Health Net, Inc. deposit cash benefits into
Associate Benefits Program, your Employer Spears' bank account.
23 provides you with 'Flex Dollars' that you can
use to pay for the cost of your optional bene Rodes Reply Dec, Ex.
24 fits. In most cases, if you use these Flex Dollars A.
to pay for before-tax benefits, these Flex
25 Dollars will be tax free to you. ... If you waive
coverage or you have Flex Dollars left over
26 after you pay the cost of all of the optional
benefits you elect, you will receive a portion of
27 your Flex Dollars as cash in your paycheck
and you will be taxed on this amount."].)
28
REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S
RENEWED MOTION FOR SUMMARY ADJUDICATION
1 Undisputed Plaintifrs F^esponse arid^^ Defendant's Reply/to
Material Facts ^ . ' '• - . •„..^.Evidence:-• Plaintiffs Response
2 and Supporting
Evidence:
3 HNCA is not a third party because HNI had Neither these "facts" nor
complete access to view HNCA's monetary the evidence are
-4 accounts. HNI is also not a third party because sufficient to contradict
"Sll of HNCA's monetary accoiints were under" the fact thffHNCA and ~
5 HNl's Finance and Account Department. HNI treated each other as
third parties for purposes
6 of the Plan as set forth in
(Exhibit 5, Colia Depo., 34:5-12, 84:18-85:6).
UF 13.
7
8 Moreover, while FfNI
administered and
9 sponsored the Plan, the
Plan was a separate legal
10 entity.
11 Horton Reply Deck, Ex.
B, Colia Depo, 150:24-
12 153:).
13 HNCA was not a third party as Defendant Neither these "facts" nor
suggests because, according to Ms. Colia, the the evidence are
14 financial accounts for both ITNCA and HNI sufficient to contradict
were under HNI's Finance.and Accounting the fact that HNCA and
15 Departmeht which controlled-fu'nds for both FTNl treated each other as
HNCA and HNI. HNCA was also not a third third parties for purposes
16 party as Defendant suggests because, as Ms. of the Plan as set forth in
Colia testified, funds between HNCA and HNI UF 13.
17 are not "moving" but the Finance and
Accounting Department was merely "tracking" Moreover, while HNI
18 the fimds between HNCA and FfNI. administered and
(See Exhibit 5, Colia Depo., at 34:5-12 sponsored the Plan, the
19 ("Through the Finance and Accounting Plan was a separate legal
Department the funds would move from entity.
20 accounts between [HNI and FINCA].", 48:15-24
("I think about financial accounting and Horton Reply Deck, Ex.
21 tracking money. And, yes, it's correct that B, Colia Depo, 150:24-
Finance and Accounting [Department] would 153:8.
22 track the funds associated with the plans
[between HNCA and HNI].")
23 Additionally, if Defendant is referring to the It is UNDISPUTED that
term "contributions" as those payments for the Plan is governed by
24 employees who waived medical benefits and IRS Code, section 125
elected to receive the taxed, cash "MedFlx (UF 6) which requires
25 Wave" or "DenFlx Wave" payments, then the one of the benefits to be
"fact" is DISPUTED as vague and ambiguous a taxable cash benefit.
26 and as contradictory to the Plan documents on Further, the amount of
the basis that the Plan documents do not at any Flex Dollars available to
27 point state that the cash provided to employees associates each year,
28 including Flex Dollars
REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S
RENEWED MOTION FOR SUMMARY ADJUDICATION
1 Undisputed Plaintiffs Response and Supporting Defendant's Reply to
Material Facts Evidence-' . V Plaintiff s Response
2 and Supporting
Evidence:
3 in exchange for not receiving medical or dental for waiving optional
benefits are actually health and welfare benefits. coverage, were
^4 -determined.by HNI "in
(See Exhibit "A" to the CoiTa Declaration filed Tts sole disci^tion""
5
with the Renewed MSJ; see also Exhibit 5, through the Benefits
Colia Depo., at 129:9-131:25 [the declarant, Committee.
6
after reviewing the entirety of the Advantages
7 Plan document, confirms that there is no See Colia Dec, Ex. A
mention of the cash payment for waiver of (HNCA00I021, §4.1).
8 benefits even though the Plan does address the
payment of Flex Dollars which may occur in
9 circumstances where benefits are elected]).
Cash payments for waiving benefits were only Undisputed that Plan
10 provided when the actual medical or dental Participants who had
benefits were waived and the employee did not coverage elsewhere
11 receive medical or dental coverage through the could waive medical or
Plan. dental coverage and
12 receive a cash benefit.
(Exhibit 5, Colia Depo., 96:2-8, 137:10-16).
13 The Plan did not categorize cash provided to Cash provided to Plan
employees who waived coverage as a benefit. Participants who waived
14 medical or dental
(See Exhibit 3 at HNCA000920-I outlining all coverage was
15 cbi^e and optional benefits available under the categorized as Flex - -
Plan; see also Exhibit 5, Colia Depo., 138:11- Dollars which was
16 139:5). defined in the Plan and
considered a benefit
17 pursuant to IRS Code,
section 125.
18
See Colia Dec, Ex. A
19 (HNCAOO 1021, §4.1).
20 Ms. Colia, during her deposition, did not know Neither these "facts" nor
whether HNI provided employee handbooks for the evidence are
21 HNCA employees, did not know whether sufficient to contradict
HNCA had separate human resources the fact that HNCA and
22 employees who were not employees of FTNI and FTNI treated each other as
did not know the location of HNCA's third parties for purposes
23 headquarters, confirming that Ms. Colia's of the Plan.
declaration statements regarding whether
24 ITNCA and FTNI were third parties lacks Moreover, while HNI
foundation. administered and
25 sponsored the Plan, the
(See Exhibit 5, Colia Depo., at 20:19-23:1). Plan was a separate legal
26 entity.
27 Horton Reply Deck, Ex.
B, Colia Depo, 150:24-
28 153:8.
-6
REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S
RENEWED MOTION FOR SUMMARY ADJUDICATION
Undisputed Plaintiff s Response and Supporting Defendant's Reply to,
Material Facts Evidence: , Plaintiffs Response
2 and Supporting
V Evidence:!
3 To the extent Defendant's "facf is intending to Pursuant to the terms of
claim that HNCA paid the actual costs of the Plan, FfNI, through
4 benefits with respect to the cash payments to .. the Benefits Committee,
empidyees'wno opted out oiTeceiving medical^ had "sole discretion" to
5 benefits, that "facf is DISPUTED. The cash determine the "amount
payments for waiving benefits are not actual of Flex Dollars to be
6 costs of benefits. The Compensation and available on behalf of
Benefits Committee, in determining the costs of each Eligible Associate"
7 benefits, approved coverage and premium rates each year. Ms. Colia's
based on a number of factors including tiers of testimony does not
8 coverage and plan type which were provided to contradict the Plan.
the employees during the open enrollment Instead, she confirmed
9 process to select benefits and coverages. the Benefits Committee
Conversely, the amounts provided to employees approved the actual
10 as cash payments for waiving benefits was amount of Flex Dollars
unrelated to the Compensation and Benefits that were made available
11 Committee's determination of costs of benefits. to Plan Participants for
The amounts provided to employees as cash waiving optional
12 payments for waiving benefits were uniform coverage.
and were determined by the EO benefits
13 department based on a collection of market data See HNCA001021 (The
and a review of "what other competitive and Plan, § 4.1); Colia Depo.
14 peer reviewed companies were doing in the 144:23-146:4.)
form of a waive credit for opting out of medical
15 arid dental plans...."
Furthermore, Ms. Colia
16 was not asked how Flex
(See Exhibit 5, Colia Depo., 42:22-43:19, Dollars for electing
17 46:14-47:2; 144:23-146:4). coverage were
determined. Instead, her
18 testimony related to the
tiered rates of optional
19 medical coverage offered
under the Plan. As
20 Plaintiff Arana's wage
statements reflect, the
21 Flex Dollars made
available to Plan
22 Participants who elected
medical coverage was
23 based on HNCA
contributing 80% of the
24 cost of that coverage to
the Plan.
25
See Rodes Dec, Ex. C
26 (Arana's elected medical
coverage Year To Date
27 cost was $ 16,570.12 and
he received 80% of that
28
7-
REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S
RENEWED MOTION FOR SUMMARY ADJUDICATION
'"''''Uhdisputed-''l'Kj Plajntiff s Responsefahd Supporting; Defehflant's Reply to
Material Facts Evidence: Plaintiffs Response
2 and Supporting^;
Evidence:l!4;K|,'
3 amount in Flex Dollars
($13,255.99).
4
Jurther DISPUTED on the ba^s that the Plaintiff mischaracterizes,
5 statement lacks foundation because the the testimony. Ms. Colia
declarant lacks knowledge regarding the confirmed that Flex
6 structure, mechanics, and processes associated Dollars for waiving
with monetary accounts for both HNI and medical or dental
7 HNCA and, therefore, has no basis to claim coverage were
ITNCA is a third party. maintained in an account
8 administered by the
(See Exhibit 5, Colia Depo at 98:2-9 ["Yeah, I Benefits Committee,
. 9 don't know the structure of the accounting used for Plan purposes
centersTor the various components of the only, and paid out in
10 Advantages plan."], 97:13-24 [declarant accordance with the
confirming her lack of familiarity with the Plan.
11 account structure related waive payments to be
distributed to the Class Members], 34:21-35:1 Horton Reply Deck, Ex.
12 ["I don't know the sequencing of the accounting B, Colia Depo, 72:3-8;
process...."], 35:2-15 [The declarant does not 155:11-156:21.
13 know whether accounting was on an individual
basis or benefits plan basis. The declarant
14 "believe[s]" she knows but does not know with
certainty how the accounts were organized]).
.15 5.- HNCA adopted 5. • Disputed and objection as vague and • '5. Undisputed.
the Plan for the ambiguous as to the phrase "for the benefit of Plaintiff provides no
16 benefit of its its employees. evidence to dispute this
employees. fact.
17
18 Declaration of Plaintiff DISPUTES Defendant's attempt to It is undisputed that the
Debbie Colia characterize cash in lieu of benefit payments as Plan is governed by IRS
19 ("Colia Dec"), H 2, a benefit itself Cash payments for waiving Code, section 125 (UF 6)
20 Exhs. A-I. benefits were only provided when the actual which requires one of the
medical or dental benefits were waived and the benefits offered under a
21 employee did not receive medical or dental cafeteria plan to be a
coverage through the Plan. (Exhibit 5. Colia taxable cash benefit.
22 Depo., 96:2-8, 137:10-16).
The Plan did not categorize cash provided to Cash provided to Plan
23 employees who waived coverage as a benefit. Participants who waived
(See Exhibit 3 at HNCA000920-1 outlining all medical or dental
24 core and optional benefits available under the coverage was
Plan; .^ee also Exhibit 5. Colia Depo., 138:11- categorized as Flex
25 139:5). Dollars which was
defined in the Plan and
26 considered a benefit
pursuant to IRS Code,
27 section 125.
28
REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S
RENEWED MOTION FOR SUMMARY ADJUDICATION
1 5 Uiidispiited Piaintiff svResiJonse and Siupportihgv Defen(lant's Reply'to
Material Facts Evidence: , Plaintiff s Response
2.. and Supporting
••4
Evidence:
3 See Colia Dec, Ex. A
(HNCAOO1021, §4.1).
,4
Plaintiff incorporates by reference herein the. "ITNCA incorporates by 1.
5 responses and supporting arguments outlined reference herein its reply
hereinaboe regarding disputed fact number 4. to Plaintiffs response to
6 UF4.
7 6. The Plan was Undisputed. 6. Undisputed.
governed by
8 Section 125 of
the Internal
9 _ Revenue Code.
10 Colia Dec, H 4.
11 7. The Plan was Undisputed. 7. Undisputed.
subject to the
12 Employee
Retirement
13 Income
Security Act.
14
Colia Dec, 114.
-15 8. The Plan was 8. Disputed as vague as to "overseen," - 8. Undisputed.
overseen by a compound, immaterial to whether cash in lieu Plaintiff provides no
16 Benefits of bonus payments should be included in the evidence to dispute this
Committee. regular rate, and as calling for a legal fact.
17 conclusion.
Colia Dec, 114. See Code Civ. Proc §
18 437c; Cal.Rules of
Court, Rule 3.1350(f)(2);
19 Reid V. State Farm Mut.
Auto Ins. Co., 173 Cal.
20 App. 3d 557, 572 (1985).
21 9. The HNI 9. Disputed and objection as vague and 9. Undisputed.
Benefits ambiguous as to the phrase "administering the Plaintiff provides no
22 Committee had Plan." evidence to dispute this
fiduciary duties fact, which is a direct
23 and quote from the Plan
responsibilities document.
24 requiring the
Committee Defendant paid cash payments for employees The Plan was the only
25 members to who opted out of receiving medical benefits. mechanism by which
"discharge their To the extent Defendant refers to Flex Dollars could have
26 duties with "administering the plan" as including paying been paid to Spears,
respect to the cash in lieu of benefit payments, then the fact is including the portion of
27 Plan (i) solely DISPUTED because the plan documents do not Flex Dollars she received
in the interest say that the cash is paid by a third party and, to as cash for waiving
28 ofthe the contrary, the plan documents say that medical coverage.
REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S
RENEWED MOTION FOR SUMMARY ADJUDICATION
- 'lUmjisputed V'' Plaintiff s Response an Defendarit's Reply to
Material Facts ' ' Eviderice^"''>' I"-- - - Plaintiff sResppnseT
2 and Supporting
Evidence:
3 Associates, (ii) Defendant as the employer is a first party not a Further, nothing in the
for the third party who is making the payments directly Plan documents
_.4 - - exclusive to Plaintiff. ' - _ - - / _ ' "contradicts the;; ...
""purpose of undisputedl'estimony
5 providing that HNCA irrevocably
(See Exhibit 3 at HNCA000916; Exhibit 4 at
benefits to HNCA000755 ["You will see the terms 'Health contributed the total cost
6 Associates and of benefits, including the
Net' and 'the Company' used throughout this
of defraying SPD to refer to Health Net, Inc and all cash benefits at issue in
7 reasonable this motion, to the Plan
participating companies. The term 'Employer'
expenses of is used in this SPD to refer to the company as set forth in UF 20.
8 administering which is your direct employer."].)
the Plan and HNCA was not
9 (iii) with the
(See Exhibit 3 at HNCA000921; Exhibit 4 at authorized to directly
care, skill,
10 prudence, and HNCA000764 ["To help you pay for the cost of deposit cash benefits into
your benefits under the Health Net, Inc. Spears' bank account.
diligence under
11 the Associate Benefits Program, your Employer
provides you with 'Flex Dollars' that you can Rodes Reply Dec, Ex.
circumstances use to pay for the cost of your optional benefits. A.
12 then prevailing In most cases, if you use these Flex Dollars to
that a prudent pay for before-tax benefits, these Flex Dollars
13 person acting in will be tax free to you. ... If you waive coverage
a like capacity or you have Flex Dollars left over after you pay
14 and familiar the cost ofall of the optional benefits you elect,
with such you will receive a portion of your Flex Dollars .
-15 matters would as cash in your paycheck and you will be
use in the taxed on this amount."].)
16 conduct ofan
enterprise of a
17 like character
and with like
18 aims, to the
extent the
19 Committee's
duties are
20 subject to
ERISA."
21
22 Colia Dec, 114,
Exh. A, § 7.1(e)
23 Disputed as incomplete as the HNI Benefits The stated "fact" is
Committee also served as the benefits unsupported by the
24 committee for HNCA. testimony. Ms. Colia
never testified that HNI'
25 (See Exhibit 5. Colia Depo., 14:25-15:7 benefits committee
[confirming that HNCA did not have a separate serves as the benefits
26 compensation and benefits committee apart committee for FINCA.
from HNI]).
27
10. HNI as the plan 10. Disputed and objection as vague and 10. Undisputed.
28 sponsor and ambiguous as to the terms "sponsor," Plaintiff provides no
10-
REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S
RENEWED MOTION FOR SUMMARY ADJUDICATION
Undisputed Plaintiff s Respohse and Supporting Defendant's Reply to
Ma teriaf Facts Evidence: Plaintiff s Response
2 ;and Supporting
Evidence:
3 administrator "administrator" and "contributions" evidence to dispute this
ensured that fact.
4 ..HNCA's
"Srnployer Defendant paid cash payirienls'for employees— The Plan"w,as the only
5 contributions to who opted out of receiving medical benefits. mechanism by which
the Plan were To the extent Defendant refers to Flex Dollars could have
6 tracked. been paid to Spears,
"administrator" as a role that included paying including the portion of
7 cash in lieu of benefit payments, then the fact is Flex Dollars she received
Colia Dec, H 4. DISPUTED because the plan documents do not as cash for waiving
8 say that the cash is paid by a third party and, to medical coverage.
the contrary, the plan documents say that Further, nothing in the
9 Defendant as the employer is a first party not a Plan documents
third party who is making the payments directly contradicts the
10 undisputed testimony
to Plainfiff. that HNCA irrevocably
11 contributed the total cost
(See Exhibit 3 at HNCA000916; Exhibit 4 at of benefits, including the
12 HNCA000755 ["You will see the terms 'Health cash benefits at issue in
Net' and 'the Company' used throughout this this motion, to the Plan
13 as set forth in UF 20.
SPD to refer to Health Net, Inc. and all
14 participating companies. The term 'Employer'
is used in this SPD to refer to the company HNCA was not
authorized to directly .
15 which is your direct employer."].) .- deposit cash benefits into •
Spears' bank account.
16
Rodes Reply Dec, Ex.
17
A.
18 Further, if Defendant is referring to the term The Plan was the only
"contributions" as those payments for mechanism by which
19 employees who waived medical benefits and Flex Dollars could have
been paid to Spears,
elected to receive the laxed, cash "MedFlx including the portion of
20
Wave" or "DenFlx Wave" payments, then the Flex Dollars she received
21 "fact" is DISPUTED as vague and ambiguous as cash for waiving
on the basis that Defendant also paid cash medical coverage.
22 directly to Plaintiff and she could spend this Further, nothing in the -
wage on anything she wanted as opposed to Plan documents
23 only on "health and welfare benefits" and these contradicts the
undisputed testimony
cash payments were part of a total remuneration that FINCA irrevocably
24
package from Defendant to employees. contributed the total cost
25
Preview
Piled 1 TIMOTHY J. LONG (STATEBARNO. 137591) tjlong(^orrick.com 2 NICHOLAS J. HORTON (STATE BAR NO. 289417) 3 nhorton(gorrick.coin AVALON JOHNSON FITZGERALD (STATE BAR NO. 288167) FlLED/ENDORSE afitzgerald@orrick.com 4 ORRICK. HERRINGTON & SUTCLIFFE LLP JAN 3 0 2019_ -400 6yr4uiMall, Suite .^SOO - ' - L—. — 5 Sacramento, CA 95814-4497 J, Carrisosa Telephone: +1916 447 8299 By; 6 Facsimile: +1 916 329 4900 7 Attomeys for Defendant HEALTH NET OF CALIFORNIA, INC. SUPERIOR COURT OF THE STATE OF CALIFORNIA 9 COUNTY OF SACRAMENTO 10 11 ANDREA SPEARS, an individual, on behalf of Case No. 34-2017-00210560-CU-OE-GDS herself and on behalf of all persons similarly 12 situated, REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN 13 Plaintiff, SUPPORT OF DEFENDANT HEALTH NET OF CALIFORNIA, INC.'S 14 RENEWED MOTION FOR SUMMARY V. ADJUDICATION 15 HEALTH NET OF CALIFORNIA, INC., a California Corporation; and Does I through 50, Date: February 4. 2019 16 inclusive. Time: 9:00 a.m. Dept.: 54 17 Defendants. 18 Reservation No.: 2380178 19 Complaint Filed: April 5.2017 FAC Filed: June 29, 2017 20 Consolidated Complaint Filed: Dec. 2, 2017 21 TOMAS R. ARANA, on behalf of himself, all Complaint Filed: August 1,2017 others similarly situated, 22 Plaintiff 23 V. 24 HEALTH NET OF CALIFORNIA, INC., a 25 California corporation; and DOES 1-50, 26 inclusive, 27 Defendant. 28 REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S RENEWED MOTION FOR SUMMARY ADJUDICATION 1 Defendant Health Net of California, Inc. ("HNCA") submits the following Reply to 2 Plaintiff Andrea Spears' ("Spears") Responsive.Separate Statement of Undisputed Material Facts 3 in Opposition to HNCA's Renewed Motion for Summary Adjudication. Spears has failed to 1 submit evidence sufficient to dispute the material facts set forth in HNCA's..Separate Statement. 5 Accordingly, HNCA is entitled to summary adjudication. 6 Spears' Responsive Separate Statement is largely non-responsive. It is replete with 7 statements unrelated to the particular Undisputed Fact at issue, deliberate mischaracterizations of 8 facts and evidence, and relies upon speculation, guesswork, and mere possibilities. Such 9 "evidence" is insufficient to controvert HNCA's evidence. See Doe v. Salesian Sac, 159 Cal. 10 App. 4th 474, 481 (2008). Moreover, Spears includes additional facts in her responses to 11 HNCA's Undisputed Facts. This is wholly improper. Spears was obligated to "set forth plainly 12 and concisely any other material facts [she] contends are disputed," rather than include these 13 purported additional facts in her response to unrelated Undisputed Facts set forth by HNCA. Cal. 14 Civ. Code. § 437c(b)(3); see also Cal. Rules of Court, Rule 3.1350(f)(3). 15 For the Court's convenience, HNCA endeavors to respond as succinctly as possible to 16 Spears' voluminous and redundant, yet mischaracterized and inadequate, evidence. 17 SEPARATE STATEMENT OF UNDISPUTED FACTS AND EVIDENCE 18 1. THIRD CAUSE OF ACTION FOR FAILURE TO PAY HOURLY WAGES AND FAILURE TO PAY OVERTIME WAGES 19 Issue 1: Plaintiffs' Failure to Pay Overtime Wages claim premised on HNCA's alleged 20 failure to include cash benefits received pursuant to a bona fide benefits Plan in Plaintiff Spears' regular rate of pay fails because cash benefits were 21 properly excluded from her regular rate calculation under the Benefit-Plan Contributions Exception and Plaintiff Arana never received the cash benefit. 22 23 i Undisputed : " • Pl^ihtifrs Response and Supporting Defendant's Reply to ; M Evidence: Plaintiffs Response 24 : and Supporting ? Evidence: 25 1. Plaintiff Spears 1. Undisputed 1. Undisputed. worked as a 26 non-exempt HNCA 27 Customer Service 28 REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S RENEWED MOTION FOR SUMMARY ADJUDICATION 1 Undisputed^if^ Plaintifrs Response and Supporting Defendant's Reply to Material Facts '' Evidence: '. .^i^sc;?"? .- Plaintifrs Response 2 and Supporting Evidence: 3 Representative from September 4 2014'to October 3-- 2016 in Rancho 5 Cordova. 6 Declaration of Diane C. Rodes 7 (hereinafter "Rodes Dec") ^4. 8 2. Plaintiff Arana Undisputed. 2. Undisputed. began working 9 out of the Rancho 10 Cordova call center in 2008 11 and continues to work there 12 now. He started as a 13 non-exempt Customer 14 Service Representative 15 for HNCA until his promotion 16 on or about November 14, 17 2015 to Contact Center Analyst, 18 an exempt position. Since 19 June 2017, Plaintiff Arana 20 has been working as a 21 Call Center Systems 22 Analyst 1, also an exempt 23 position. 24 Rodes Dec, H 6. 25 3. Between 3. Disputed as incomplete. 3. Undisputed. January 1, 2001 Plaintiff provides no 26 and December evidence to dispute this 31,2016, HNI fact. 27 sponsored a 28 -2- REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S RENEWED MOTION FOR SUMMARY ADJUDICATION Undisputed PlaintitTs Response and Supporting Defendant's Reply to Material Facts Evidence: «Plaintiffs Response 2 and Supporting Evidence: •3 cafeteria plan - Defendant's Plan provided medical benefits, but HNCA did not pay any a written health Defendant also provided cash payments directly cash benefits directly to ,4 and welfare " tq employees who'waived their right to medical Spea£s because she plan-'called benefits and tHFplan was not ado'pted not just authorizedTTNI, not 5 the "Health "for the benefit of its employees" but rather was HNCA to deposit money Net, Inc. part of Defendant's effort "to provide associates directly into her bank 6 Associates with a competitive benefits program that is part account. Benefit of our total remuneration plan." 7 Program" (the (Reply Declaration of "Plan"). (See Exhibit 3. 2011 -2015 Summary Plan Diane Rodes ("Rodes 8 Description at p. 1; Exhibit 4 2016 Summary Reply Dec"), Ex. A.) 9 Declaration of Plan Description at p. 1.) Debbie Colia HNCA does not dispute 10 ("Colia Dec"), (See also Exhibit 3 at HNCA000921; Exhibit 4 that the Plan provided for Tl 2-3, Exhs. A-I. at HNCA000764 ["To help you pay for the cost medical benefits and 11 of your benefits under the Health Net, Inc. cash benefits; however Associate Benefits Program, your Employer neither this "facf nor the 12 provides you with 'Flex Dollars' that you can cited evidence use to pay for the cost of your optional benefits. contradicts UF 3. 13 In most cases, if you use these Flex Dollars to Instead this fact supports pay for before-tax benefits, these Flex Dollars a finding that the Plan 14 will be tax free to you. ... If you waive coverage was a cafeteria style or you have Flex Dollars left over after you pay plan. -1>5- the cost ofall of the optional benefits you elect,-, you will receive a portion of your Flex Dollars Cafeteria benefit plans 16 as cash in your paycheck and you will be taxed must offer benefit on this amount."].) options for its 17 Participants to choose (See also Exhibit 3 at HNCA000916; Exhibit 4 from, one of which must 18 at HNCA000755 [describing the term be a taxable cash benefit. "employer" in the Health Plan as the party that See IRS Code, section 19 pays the cash for waived medical benefits as 125. As such, the Defendant says: "You will see the terms 'Health offering of a cash benefit 20 Net' and 'the Company' used throughout this cannot be used as a basis SPD to refer to Health Net, Inc. and all to dispute whether the 21 participating companies. The term 'Employer' benefits plan was a is used in this SPD to refer to the company cafeteria plan. Further, 22 which is your direct employer."].) Plaintiff does not dispute that IRS Code, section 23 (See also Exhibit 3 at HNCA000916; Exhibit 4 125 governs the Plan. at page HNCA000755 [describing the plan as See UF 6. 24 resulting from Defendant's effort to "provide associates with a competitive benefits program 25 that is part of [Defendant's] total remuneration plan."].) 26 27 (See also Exhibit 6. PMK Deposition at 61:10- 18 [cash payments for waiving benefits are 28 directiy deposited into Plaintiffs bank account -3 - REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S RENEWED MOTION FOR SUMMARY ADJUDICATION Undisputed Plaintifrs Response and Supporting : Defendant's Reply to:> Material FactS; } Evidence: ;„/.;;•.:•;''•',••'• Plaintiffs Response ;^ 2 and Supporting Evidence':-'v-l v' 3 in wage statement of taxed wages by Defendant directly to Plaintiff].) 4 Cash payments for waiving benefits were only Neitlier this.fact nor the ~ . 5 provided when the actual medical or dental cited evidence benefits were waived and the employee did not contradicts UF 3, but 6 receive medical or dental coverage through the instead supports a Plan. finding that the Plan was 7 a cafeteria style plan. (Exhibit 5. Colia Depo.. 96:2-8. 137:10-161 8 4. As the Plan 4. Disputed and objection as vague and 4. Undisputed. sponsor, HNI ambiguous as to the terms "sponsor" and Plaintiff provides no 9 administered "administered the plan." evidence to dispute this the Plan. fact. 10 Colia Dec, TI 2. 11 Defendant paid cash payments for employees The Plan was the only 12 who opted out of receiving medical benefits. mechanism by which To the extent Defendant refers to "administered Flex Dollars could have 13 the plan" as including paying cash in lieu of been paid to Spears, benefit payments, then the fact is DISPUTED including the portion of 14 because the plan documents do not say that the Flex Dollars she received cash is paid by a third party and, to the contrary, as cash for waiving 15 the plan documents say that Pefendant as the medical coverage.. employer is a first party not a third party who is Further, nothing in the 16 making the payments directly to Plaintiff. Plan documents contradicts the 17 (See Exhibit 3 at HNCA000916; Exhibit 4 at undisputed testimony HNCA000755 ["You will see the terms 'Health that HNCA irrevocably Net' and 'the Company' used throughout this contributed the total cost 18 of benefits, including the SPD to refer to Health Net, Inc. and all participating companies. The term 'Employer' cash benefits at issue in 19 this motion, to the Plan is used in this SPD to refer to the company which is your direct employer."].) as set forth in UF 20. 20 21 (See Exhibit 3 at HNCA000921; Exhibit 4 at ITNCA was not page HNCA000764 ["To help you pay for the authorized to directly 22 cost of your benefits under the Health Net, Inc. deposit cash benefits into Associate Benefits Program, your Employer Spears' bank account. 23 provides you with 'Flex Dollars' that you can use to pay for the cost of your optional bene Rodes Reply Dec, Ex. 24 fits. In most cases, if you use these Flex Dollars A. to pay for before-tax benefits, these Flex 25 Dollars will be tax free to you. ... If you waive coverage or you have Flex Dollars left over 26 after you pay the cost of all of the optional benefits you elect, you will receive a portion of 27 your Flex Dollars as cash in your paycheck and you will be taxed on this amount."].) 28 REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S RENEWED MOTION FOR SUMMARY ADJUDICATION 1 Undisputed Plaintifrs F^esponse arid^^ Defendant's Reply/to Material Facts ^ . ' '• - . •„..^.Evidence:-• Plaintiffs Response 2 and Supporting Evidence: 3 HNCA is not a third party because HNI had Neither these "facts" nor complete access to view HNCA's monetary the evidence are -4 accounts. HNI is also not a third party because sufficient to contradict "Sll of HNCA's monetary accoiints were under" the fact thffHNCA and ~ 5 HNl's Finance and Account Department. HNI treated each other as third parties for purposes 6 of the Plan as set forth in (Exhibit 5, Colia Depo., 34:5-12, 84:18-85:6). UF 13. 7 8 Moreover, while FfNI administered and 9 sponsored the Plan, the Plan was a separate legal 10 entity. 11 Horton Reply Deck, Ex. B, Colia Depo, 150:24- 12 153:). 13 HNCA was not a third party as Defendant Neither these "facts" nor suggests because, according to Ms. Colia, the the evidence are 14 financial accounts for both ITNCA and HNI sufficient to contradict were under HNI's Finance.and Accounting the fact that HNCA and 15 Departmeht which controlled-fu'nds for both FTNl treated each other as HNCA and HNI. HNCA was also not a third third parties for purposes 16 party as Defendant suggests because, as Ms. of the Plan as set forth in Colia testified, funds between HNCA and HNI UF 13. 17 are not "moving" but the Finance and Accounting Department was merely "tracking" Moreover, while HNI 18 the fimds between HNCA and FfNI. administered and (See Exhibit 5, Colia Depo., at 34:5-12 sponsored the Plan, the 19 ("Through the Finance and Accounting Plan was a separate legal Department the funds would move from entity. 20 accounts between [HNI and FINCA].", 48:15-24 ("I think about financial accounting and Horton Reply Deck, Ex. 21 tracking money. And, yes, it's correct that B, Colia Depo, 150:24- Finance and Accounting [Department] would 153:8. 22 track the funds associated with the plans [between HNCA and HNI].") 23 Additionally, if Defendant is referring to the It is UNDISPUTED that term "contributions" as those payments for the Plan is governed by 24 employees who waived medical benefits and IRS Code, section 125 elected to receive the taxed, cash "MedFlx (UF 6) which requires 25 Wave" or "DenFlx Wave" payments, then the one of the benefits to be "fact" is DISPUTED as vague and ambiguous a taxable cash benefit. 26 and as contradictory to the Plan documents on Further, the amount of the basis that the Plan documents do not at any Flex Dollars available to 27 point state that the cash provided to employees associates each year, 28 including Flex Dollars REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S RENEWED MOTION FOR SUMMARY ADJUDICATION 1 Undisputed Plaintiffs Response and Supporting Defendant's Reply to Material Facts Evidence-' . V Plaintiff s Response 2 and Supporting Evidence: 3 in exchange for not receiving medical or dental for waiving optional benefits are actually health and welfare benefits. coverage, were ^4 -determined.by HNI "in (See Exhibit "A" to the CoiTa Declaration filed Tts sole disci^tion"" 5 with the Renewed MSJ; see also Exhibit 5, through the Benefits Colia Depo., at 129:9-131:25 [the declarant, Committee. 6 after reviewing the entirety of the Advantages 7 Plan document, confirms that there is no See Colia Dec, Ex. A mention of the cash payment for waiver of (HNCA00I021, §4.1). 8 benefits even though the Plan does address the payment of Flex Dollars which may occur in 9 circumstances where benefits are elected]). Cash payments for waiving benefits were only Undisputed that Plan 10 provided when the actual medical or dental Participants who had benefits were waived and the employee did not coverage elsewhere 11 receive medical or dental coverage through the could waive medical or Plan. dental coverage and 12 receive a cash benefit. (Exhibit 5, Colia Depo., 96:2-8, 137:10-16). 13 The Plan did not categorize cash provided to Cash provided to Plan employees who waived coverage as a benefit. Participants who waived 14 medical or dental (See Exhibit 3 at HNCA000920-I outlining all coverage was 15 cbi^e and optional benefits available under the categorized as Flex - - Plan; see also Exhibit 5, Colia Depo., 138:11- Dollars which was 16 139:5). defined in the Plan and considered a benefit 17 pursuant to IRS Code, section 125. 18 See Colia Dec, Ex. A 19 (HNCAOO 1021, §4.1). 20 Ms. Colia, during her deposition, did not know Neither these "facts" nor whether HNI provided employee handbooks for the evidence are 21 HNCA employees, did not know whether sufficient to contradict HNCA had separate human resources the fact that HNCA and 22 employees who were not employees of FTNI and FTNI treated each other as did not know the location of HNCA's third parties for purposes 23 headquarters, confirming that Ms. Colia's of the Plan. declaration statements regarding whether 24 ITNCA and FTNI were third parties lacks Moreover, while HNI foundation. administered and 25 sponsored the Plan, the (See Exhibit 5, Colia Depo., at 20:19-23:1). Plan was a separate legal 26 entity. 27 Horton Reply Deck, Ex. B, Colia Depo, 150:24- 28 153:8. -6 REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S RENEWED MOTION FOR SUMMARY ADJUDICATION Undisputed Plaintiff s Response and Supporting Defendant's Reply to, Material Facts Evidence: , Plaintiffs Response 2 and Supporting V Evidence:! 3 To the extent Defendant's "facf is intending to Pursuant to the terms of claim that HNCA paid the actual costs of the Plan, FfNI, through 4 benefits with respect to the cash payments to .. the Benefits Committee, empidyees'wno opted out oiTeceiving medical^ had "sole discretion" to 5 benefits, that "facf is DISPUTED. The cash determine the "amount payments for waiving benefits are not actual of Flex Dollars to be 6 costs of benefits. The Compensation and available on behalf of Benefits Committee, in determining the costs of each Eligible Associate" 7 benefits, approved coverage and premium rates each year. Ms. Colia's based on a number of factors including tiers of testimony does not 8 coverage and plan type which were provided to contradict the Plan. the employees during the open enrollment Instead, she confirmed 9 process to select benefits and coverages. the Benefits Committee Conversely, the amounts provided to employees approved the actual 10 as cash payments for waiving benefits was amount of Flex Dollars unrelated to the Compensation and Benefits that were made available 11 Committee's determination of costs of benefits. to Plan Participants for The amounts provided to employees as cash waiving optional 12 payments for waiving benefits were uniform coverage. and were determined by the EO benefits 13 department based on a collection of market data See HNCA001021 (The and a review of "what other competitive and Plan, § 4.1); Colia Depo. 14 peer reviewed companies were doing in the 144:23-146:4.) form of a waive credit for opting out of medical 15 arid dental plans...." Furthermore, Ms. Colia 16 was not asked how Flex (See Exhibit 5, Colia Depo., 42:22-43:19, Dollars for electing 17 46:14-47:2; 144:23-146:4). coverage were determined. Instead, her 18 testimony related to the tiered rates of optional 19 medical coverage offered under the Plan. As 20 Plaintiff Arana's wage statements reflect, the 21 Flex Dollars made available to Plan 22 Participants who elected medical coverage was 23 based on HNCA contributing 80% of the 24 cost of that coverage to the Plan. 25 See Rodes Dec, Ex. C 26 (Arana's elected medical coverage Year To Date 27 cost was $ 16,570.12 and he received 80% of that 28 7- REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S RENEWED MOTION FOR SUMMARY ADJUDICATION '"''''Uhdisputed-''l'Kj Plajntiff s Responsefahd Supporting; Defehflant's Reply to Material Facts Evidence: Plaintiffs Response 2 and Supporting^; Evidence:l!4;K|,' 3 amount in Flex Dollars ($13,255.99). 4 Jurther DISPUTED on the ba^s that the Plaintiff mischaracterizes, 5 statement lacks foundation because the the testimony. Ms. Colia declarant lacks knowledge regarding the confirmed that Flex 6 structure, mechanics, and processes associated Dollars for waiving with monetary accounts for both HNI and medical or dental 7 HNCA and, therefore, has no basis to claim coverage were ITNCA is a third party. maintained in an account 8 administered by the (See Exhibit 5, Colia Depo at 98:2-9 ["Yeah, I Benefits Committee, . 9 don't know the structure of the accounting used for Plan purposes centersTor the various components of the only, and paid out in 10 Advantages plan."], 97:13-24 [declarant accordance with the confirming her lack of familiarity with the Plan. 11 account structure related waive payments to be distributed to the Class Members], 34:21-35:1 Horton Reply Deck, Ex. 12 ["I don't know the sequencing of the accounting B, Colia Depo, 72:3-8; process...."], 35:2-15 [The declarant does not 155:11-156:21. 13 know whether accounting was on an individual basis or benefits plan basis. The declarant 14 "believe[s]" she knows but does not know with certainty how the accounts were organized]). .15 5.- HNCA adopted 5. • Disputed and objection as vague and • '5. Undisputed. the Plan for the ambiguous as to the phrase "for the benefit of Plaintiff provides no 16 benefit of its its employees. evidence to dispute this employees. fact. 17 18 Declaration of Plaintiff DISPUTES Defendant's attempt to It is undisputed that the Debbie Colia characterize cash in lieu of benefit payments as Plan is governed by IRS 19 ("Colia Dec"), H 2, a benefit itself Cash payments for waiving Code, section 125 (UF 6) 20 Exhs. A-I. benefits were only provided when the actual which requires one of the medical or dental benefits were waived and the benefits offered under a 21 employee did not receive medical or dental cafeteria plan to be a coverage through the Plan. (Exhibit 5. Colia taxable cash benefit. 22 Depo., 96:2-8, 137:10-16). The Plan did not categorize cash provided to Cash provided to Plan 23 employees who waived coverage as a benefit. Participants who waived (See Exhibit 3 at HNCA000920-1 outlining all medical or dental 24 core and optional benefits available under the coverage was Plan; .^ee also Exhibit 5. Colia Depo., 138:11- categorized as Flex 25 139:5). Dollars which was defined in the Plan and 26 considered a benefit pursuant to IRS Code, 27 section 125. 28 REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S RENEWED MOTION FOR SUMMARY ADJUDICATION 1 5 Uiidispiited Piaintiff svResiJonse and Siupportihgv Defen(lant's Reply'to Material Facts Evidence: , Plaintiff s Response 2.. and Supporting ••4 Evidence: 3 See Colia Dec, Ex. A (HNCAOO1021, §4.1). ,4 Plaintiff incorporates by reference herein the. "ITNCA incorporates by 1. 5 responses and supporting arguments outlined reference herein its reply hereinaboe regarding disputed fact number 4. to Plaintiffs response to 6 UF4. 7 6. The Plan was Undisputed. 6. Undisputed. governed by 8 Section 125 of the Internal 9 _ Revenue Code. 10 Colia Dec, H 4. 11 7. The Plan was Undisputed. 7. Undisputed. subject to the 12 Employee Retirement 13 Income Security Act. 14 Colia Dec, 114. -15 8. The Plan was 8. Disputed as vague as to "overseen," - 8. Undisputed. overseen by a compound, immaterial to whether cash in lieu Plaintiff provides no 16 Benefits of bonus payments should be included in the evidence to dispute this Committee. regular rate, and as calling for a legal fact. 17 conclusion. Colia Dec, 114. See Code Civ. Proc § 18 437c; Cal.Rules of Court, Rule 3.1350(f)(2); 19 Reid V. State Farm Mut. Auto Ins. Co., 173 Cal. 20 App. 3d 557, 572 (1985). 21 9. The HNI 9. Disputed and objection as vague and 9. Undisputed. Benefits ambiguous as to the phrase "administering the Plaintiff provides no 22 Committee had Plan." evidence to dispute this fiduciary duties fact, which is a direct 23 and quote from the Plan responsibilities document. 24 requiring the Committee Defendant paid cash payments for employees The Plan was the only 25 members to who opted out of receiving medical benefits. mechanism by which "discharge their To the extent Defendant refers to Flex Dollars could have 26 duties with "administering the plan" as including paying been paid to Spears, respect to the cash in lieu of benefit payments, then the fact is including the portion of 27 Plan (i) solely DISPUTED because the plan documents do not Flex Dollars she received in the interest say that the cash is paid by a third party and, to as cash for waiving 28 ofthe the contrary, the plan documents say that medical coverage. REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S RENEWED MOTION FOR SUMMARY ADJUDICATION - 'lUmjisputed V'' Plaintiff s Response an Defendarit's Reply to Material Facts ' ' Eviderice^"''>' I"-- - - Plaintiff sResppnseT 2 and Supporting Evidence: 3 Associates, (ii) Defendant as the employer is a first party not a Further, nothing in the for the third party who is making the payments directly Plan documents _.4 - - exclusive to Plaintiff. ' - _ - - / _ ' "contradicts the;; ... ""purpose of undisputedl'estimony 5 providing that HNCA irrevocably (See Exhibit 3 at HNCA000916; Exhibit 4 at benefits to HNCA000755 ["You will see the terms 'Health contributed the total cost 6 Associates and of benefits, including the Net' and 'the Company' used throughout this of defraying SPD to refer to Health Net, Inc and all cash benefits at issue in 7 reasonable this motion, to the Plan participating companies. The term 'Employer' expenses of is used in this SPD to refer to the company as set forth in UF 20. 8 administering which is your direct employer."].) the Plan and HNCA was not 9 (iii) with the (See Exhibit 3 at HNCA000921; Exhibit 4 at authorized to directly care, skill, 10 prudence, and HNCA000764 ["To help you pay for the cost of deposit cash benefits into your benefits under the Health Net, Inc. Spears' bank account. diligence under 11 the Associate Benefits Program, your Employer provides you with 'Flex Dollars' that you can Rodes Reply Dec, Ex. circumstances use to pay for the cost of your optional benefits. A. 12 then prevailing In most cases, if you use these Flex Dollars to that a prudent pay for before-tax benefits, these Flex Dollars 13 person acting in will be tax free to you. ... If you waive coverage a like capacity or you have Flex Dollars left over after you pay 14 and familiar the cost ofall of the optional benefits you elect, with such you will receive a portion of your Flex Dollars . -15 matters would as cash in your paycheck and you will be use in the taxed on this amount."].) 16 conduct ofan enterprise of a 17 like character and with like 18 aims, to the extent the 19 Committee's duties are 20 subject to ERISA." 21 22 Colia Dec, 114, Exh. A, § 7.1(e) 23 Disputed as incomplete as the HNI Benefits The stated "fact" is Committee also served as the benefits unsupported by the 24 committee for HNCA. testimony. Ms. Colia never testified that HNI' 25 (See Exhibit 5. Colia Depo., 14:25-15:7 benefits committee [confirming that HNCA did not have a separate serves as the benefits 26 compensation and benefits committee apart committee for FINCA. from HNI]). 27 10. HNI as the plan 10. Disputed and objection as vague and 10. Undisputed. 28 sponsor and ambiguous as to the terms "sponsor," Plaintiff provides no 10- REPLY SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF DEFENDANT'S RENEWED MOTION FOR SUMMARY ADJUDICATION Undisputed Plaintiff s Respohse and Supporting Defendant's Reply to Ma teriaf Facts Evidence: Plaintiff s Response 2 ;and Supporting Evidence: 3 administrator "administrator" and "contributions" evidence to dispute this ensured that fact. 4 ..HNCA's "Srnployer Defendant paid cash payirienls'for employees— The Plan"w,as the only 5 contributions to who opted out of receiving medical benefits. mechanism by which the Plan were To the extent Defendant refers to Flex Dollars could have 6 tracked. been paid to Spears, "administrator" as a role that included paying including the portion of 7 cash in lieu of benefit payments, then the fact is Flex Dollars she received Colia Dec, H 4. DISPUTED because the plan documents do not as cash for waiving 8 say that the cash is paid by a third party and, to medical coverage. the contrary, the plan documents say that Further, nothing in the 9 Defendant as the employer is a first party not a Plan documents third party who is making the payments directly contradicts the 10 undisputed testimony to Plainfiff. that HNCA irrevocably 11 contributed the total cost (See Exhibit 3 at HNCA000916; Exhibit 4 at of benefits, including the 12 HNCA000755 ["You will see the terms 'Health cash benefits at issue in Net' and 'the Company' used throughout this this motion, to the Plan 13 as set forth in UF 20. SPD to refer to Health Net, Inc. and all 14 participating companies. The term 'Employer' is used in this SPD to refer to the company HNCA was not authorized to directly . 15 which is your direct employer."].) .- deposit cash benefits into • Spears' bank account. 16 Rodes Reply Dec, Ex. 17 A. 18 Further, if Defendant is referring to the term The Plan was the only "contributions" as those payments for mechanism by which 19 employees who waived medical benefits and Flex Dollars could have been paid to Spears, elected to receive the laxed, cash "MedFlx including the portion of 20 Wave" or "DenFlx Wave" payments, then the Flex Dollars she received 21 "fact" is DISPUTED as vague and ambiguous as cash for waiving on the basis that Defendant also paid cash medical coverage. 22 directly to Plaintiff and she could spend this Further, nothing in the - wage on anything she wanted as opposed to Plan documents 23 only on "health and welfare benefits" and these contradicts the undisputed testimony cash payments were part of a total remuneration that FINCA irrevocably 24 package from Defendant to employees. contributed the total cost 25