Leeper v. Shipt, Inc.

Pending. The Second District, Division One, held that every PAGA action necessarily includes both an individual and a representative claim as a matter of statutory text — Labor Code § 2699(a)Lab. Code § 2699Operative text of § 2699(a)(a) Notwithstanding any other provision of law, any provision of this code that provides for a civil penalty to be assessed and collected by the Labor and Workforce Development Agency or any of its departments, divisions, commissions, boards, agencies, or employees, for a violation of this code, may, as an alternative, be recovered through a civil action brought by an aggrieved employee on behalf of the employee and other current or former employees …Fetched from leginfo 2026-08-02 authorizes an action 'on behalf of the employee and other current or former employees,' and 'and' is conjunctive — so a complaint styled as representative-only still contains an individual claim that can be compelled to arbitration, with the representative portion stayed. (Leeper v. Shipt, Inc. (2024) 107 Cal.App.5th 1001, review granted April 16, 2025, S289305.)

Review arrived on the court's own initiative: neither party petitioned; the court extended its own-motion window in February 2025, then on April 16, 2025 denied depublication and ordered review itself, limiting briefing to two questions — whether every PAGA action necessarily includes both individual and non-individual claims regardless of what the complaint specifically alleges, and whether a plaintiff can choose to bring only a non-individual PAGA action. The answers will determine whether the post-Viking River arbitration architecture can be pleaded around.

The headless PAGA action is the plaintiffs' bar's answer to Viking River and Adolph. If a complaint contains an individual PAGA claim, the employer with an arbitration agreement can compel that claim to arbitration, stay the representative case under Code of Civil Procedure § 1281.4Code Civ. Proc. § 1281.4Operative text of § 1281.41281.4. If a court of competent jurisdiction, whether in this State or not, has ordered arbitration of a controversy which is an issue involved in an action or proceeding pending before a court of this State, the court in which such action or proceeding is pending shall, upon motion of a party to such action or proceeding, stay the action or proceeding until an arbitration is had in accordance with the order to arbitrate or until such earlier time as the …Fetched from leginfo 2026-08-02, and litigate the plaintiff's aggrieved-employee status in a forum whose finding — once confirmed — binds the court. Every one of those levers depends on the individual claim existing. So plaintiffs began drafting it out: complaints brought 'on a representative, non-individual basis,' captions rewritten to read 'in a Representative Capacity only,' individual penalties expressly renounced — sometimes with the pleading itself announcing that there is nothing to compel.

The design has three payoffs. No individual claim means no arbitration; no arbitration means no stay and no delay; and no arbitral forum means no risk that an arbitrator finds the plaintiff suffered no violation and thereby destroys standing for the entire action. Whether the statute permits that design at all is the question the Supreme Court took Leeper to answer.

Christina Leeper signed an independent contractor agreement — incorporating an FAA-governed arbitration agreement reaching 'any and all disputes, claims, or controversies of any kind and nature,' with a delegation clause — to work as a Shipt shopper. In March 2024 she sued Shipt and its parent Target on a misclassification theory, seeking only 'non-individual' civil penalties and non-individual injunctive and declaratory relief. The complaint was candid about its purpose: because only non-individual PAGA claims were alleged, it asserted, Shipt could not compel them to arbitration.

The trial court denied the motion on that exact ground — a solely representative suit offers no individual cause of action to compel. The Court of Appeal reversed with directions to compel the individual PAGA claim to arbitration and stay the representative portion — no amount of artful pleading can remove a component the statute builds into every PAGA action.

The Leeper court's reasoning is compact: § 2699(a) describes a PAGA action as one brought 'on behalf of the employee and other current or former employees,' and the ordinary meaning of 'and' is conjunctive. An action on behalf of the employee is the individual claim; an action on behalf of others is the representative claim; the statute joins them. Reading 'and' to mean 'and/or' — or excising 'on behalf of the employee' — would rewrite the text. Drafting history reinforced the point: the original bill said 'or,' and an 'author's technical amendment' substituted 'and' — a change the Legislature accepted without opposition.

The court rejected Leeper's two counter-readings. The phrase 'as an alternative' in § 2699(a) refers to PAGA recovery as an alternative to enforcement by the LWDA itself, not to an election between individual and representative components. And § 2699(k)(1), which preserves an employee's right to pursue 'other remedies,' speaks to non-PAGA claims, not to a right to amputate part of a PAGA action. The court acknowledged the consequence candidly — the individual claim may be compelled wherever the FAA applies, with issue preclusion shaping what remains — and went further than Adolph on sequencing: the § 1281.4 stay is mandatory once arbitration is ordered, the statute's 'shall' leaving only its duration to discretion.

Four other published decisions frame the conflict. Balderas v. Fresh Start Harvesting, Inc. (2024) 101 Cal.App.5th 533 reversed an order striking a representative-only complaint, holding that under Adolph a plaintiff who alleges she was employed and suffered violations has standing even without seeking individual relief. Williams v. Alacrity Solutions Group, LLC (2025) 110 Cal.App.5th 932, review granted July 9, 2025 (S291199), took the Leeper side and extended it: a PAGA plaintiff must seek penalties on his own behalf, and that individual claim must be timely — so a worker whose one-year window had lapsed could not maintain a headless action at all.

Rodriguez v. Packers Sanitation Services Ltd., LLC (2025) 109 Cal.App.5th 69 declined to follow Leeper from a different angle: on a motion to compel, the only question is what the complaint actually pleads, and a complaint drafted to exclude individual relief presents nothing to compel — though the court locked the plaintiff into his disclaimer through judicial estoppel, charted a Code of Civil Procedure § 436(b)Code Civ. Proc. § 436Operative text of § 436(b)(b) Strike out all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court. (Amended by Stats. 1983, Ch. 1167, Sec. 4.)Fetched from leginfo 2026-08-02 challenge as the proper response, and left open whether such a complaint is properly pleaded. CRST Expedited, Inc. v. Superior Court (2025) 112 Cal.App.5th 872 met Leeper head-on: 'and' in the pre-reform statute is ambiguous, PAGA's enforcement purpose favors reading it as an inclusive 'and/or,' and headless actions were among the choices allowed the state's proxies — a holding expressly confined to pre-reform filings.

The Supreme Court has converted the conflict into a queue. Review was granted and held in Rodriguez on May 14, 2025 (S290182), in Williams on July 9, 2025 (S291199), and in CRST Expedited on September 17, 2025 (S292005, depublication denied), and conference minutes through May 2026 keep adding grant-and-holds behind the lead case. Balderas is the only decision in the group still standing as citable published authority. The conflict is complete — text against purpose, with the remedial question contested even within the Leeper camp.

The docket shows a court determined to answer. The same day review was granted, the superior court dismissed the underlying action at Leeper's request — and the Supreme Court proceeded regardless, keeping its vehicle. Merits briefing opened in July 2025 and closed into a January 2026 amicus wave: an Impact Fund-led coalition of worker advocacy organizations behind Leeper; business coalitions fronted by the U.S. Chamber of Commerce, the National Federation of Independent Business, and the Restaurant Law Center behind Shipt. Neither the LWDA nor the Attorney General appears among the amici — the state's own view of headless enforcement remains unstated.

As of late July 2026 the case is fully briefed and awaiting argument. The published 2026 calendar seats no July or August session — the remaining sittings are September, a special October outreach session, November, and December — so no decision can arrive before fall, and the 90-day submission clock starts only at argument. For employers holding stayed headless cases the planning horizon is year-end 2026, with a second wave of grant-and-hold dispositions immediately behind the opinion.

If the Supreme Court affirms Leeper's reasoning, every PAGA complaint contains an individual claim as a matter of law, the Viking River lever works in every case with an enforceable agreement, and the headless strategy dies — subject to the follow-on question Williams answered and Rodriguez reserved: whether the consequence of the individual component is compelled arbitration, a pleading defect, or a limitations bar. If the court reverses, representative-only pleading becomes the standard plaintiff template in arbitration-bound workforces, and defense strategy shifts entirely to Adolph-era containment — standing challenges, scope limitation under Estrada, and penalty discipline.

The 2024 reform hovers over the case without controlling it. Leeper was filed in March 2024, so the pre-amendment statute governs — as it does for the pending pre-reform inventory — although Leeper itself quoted the amended § 2699(a), a wrinkle Rodriguez flagged. For post-June 19, 2024 filings, amended § 2699(c)(1) requires that the plaintiff have 'personally suffered each of the violations alleged,' language that tightens the standing side of the equation but does not by its terms answer whether an individual claim for relief must be pleaded. Whatever the court holds, expect immediate litigation over how much reasoning carries forward to the amended text — a question CRST expressly reserved.

Leeper is the most consequential pending case in California wage and hour law because it decides whether the arbitration infrastructure employers spent a decade building still has a point of entry. The headless complaint is now the default plaintiff response to a known arbitration agreement; in its shadow, motions to compel are being granted, denied, and deferred on identical facts depending on the district. Until the decision lands, every case management decision in a headless case — compel now, demur, stay, or answer — is a bet on the outcome.

The decision will also allocate the value of arbitration agreements themselves. An affirmance restores the full Adolph sequence — compel, stay, litigate aggrieved status in arbitration — and makes agreement coverage and enforceability the most valuable compliance asset an employer holds. A reversal converts those agreements into individual-claim insurance only, and shifts defense economics to the tools that operate inside the representative case.