ARTICLE
26 July 2022

Why You May Not Want To Be A "Guiding Spirit"

AM
Allen Matkins Leck Gamble Mallory & Natsis

Contributor

Allen Matkins, founded in 1977, is a California-based law firm with more than 200 attorneys in four major metropolitan areas of California: Los Angeles, Orange County, San Diego, and San Francisco. The firm's areas of focus include real estate, construction, land use, environmental and natural resources, corporate and securities, real estate and commercial finance, bankruptcy, restructurings and creditors' rights, joint ventures, and tax; labor and employment, and trials, litigation, risk management, and alternative dispute resolution in all of these areas. For more information about Allen Matkins please visit www.allenmatkins.com.
Last week, I wrote about California Labor Code § 558.1 which provides that an owner, director, officer, or managing agent of an employer (a "person acting on behalf of an employer") may be liable "as the employer" for violating,...
United States Employment and HR
Allen Matkins Leck Gamble Mallory & Natsis are most popular:
  • within Finance and Banking, Government, Public Sector and Energy and Natural Resources topic(s)
  • in United States
  • with readers working within the Technology industries

Last week, I wrote about California Labor Code § 558.1 which provides that an owner, director, officer, or managing agent of an employer (a "person acting on behalf of an employer") may be liable "as the employer" for violating, or causing to be violated, any provision regulating minimum wages or hours and days of work in any order of the Industrial Welfare Commission, or violating, or causing to be violated, Sections 203, 226, 226.7, 1193.6, 1194, or 2802 of the Labor Code.

Presumably, these violations must relate to employment in California. But what if the owner, director, officer, or managing agent of the employer is not in California? According to U.S. District Court Judge Dolly M. Gee, "just because an individual's job title may open him up to potential liability under a California statute in the abstract does not mean that, without any minimum contacts, he is subject to California courts' personal jurisdiction". Duong v. Groundhog Enterprises, Inc., No. 2020 WL 2046397, at *3 (C.D. Cal. Feb. 7, 2020). According to Judge Gee, "Courts may have personal jurisdiction over corporate officers arising out of their duties as officers only when the officers are 'the guiding spirit behind the wrongful conduct, or the central figure in the challenged corporate activity.' " Id. [In re Boon Glob. Ltd., 923 F.3d 643 (9th Cir. 2019)] at 651 (citing Facebook, Inc. v. Power Ventures, Inc., 844 F.3d 1058, 1069 (9th Cir. 2016))." Judge Otis D. Wright, II has also applied a "guiding spirit" test for personal jurisdiction in a case seeking to impose liability under Section 558.1. Green v. Hepta Run, Inc., 2020 WL 1638273, at *3 (C.D. Cal. Apr. 2, 2020).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

[View Source]

Mondaq uses cookies on this website. By using our website you agree to our use of cookies as set out in our Privacy Policy.

Learn More