Steele v. Assurance IQ, LLC et al

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF CALIFORNIA
MARK STEELE, individually, and on
behalf of all other similarly situated and
aggrieved employees,
Plaintiff,
v.
ASSURANCE IQ, LLC, et al.,
Defendants.
Case No.: 25-cv-1614-RSH-AHG
ORDER GRANTING IN PART
MOTION TO STAY
[ECF No. 23]
Before the Court is a motion to stay, or in the alternative, to dismiss filed by
defendants 	Assurance 	IQ, 	LLC 	(“Assurance”) 	and 	Prudential 	Financial, 	Inc.
(“Prudential”). ECF No. 23. Pursuant to Local Civil Rule 7.1(d)(1), the Court finds the
motion presented appropriate for resolution without oral argument. For the reasons
below, the Court grants in part Defendants’ motion.
I. 	BACKGROUND
The instant case is a putative wage and hour class action and California Private
Attorneys General Act (“PAGA”), Cal. Lab. Code § 2699 et seq., representative action
filed against defendants Assurance IQ and Prudential on June 24, 2025. ECF No. 1.
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A. 	Plaintiff’s Allegations
Plaintiff’s Amended Complaint alleges as follows. Plaintiff worked for Defendants
from July 2023 to April 2024 as an insurance sales agent. ECF No. 5 ¶¶ 5, 19, 23.
Plaintiff alleges that during that time, he and other putative class members were
misclassified as independent contractors. Id. ¶¶ 18, 20.
The Amended Complaint asserts claims under the California Labor Code, the
federal Worker Adjustment and Retraining Notification Act, 29 U.S.C. § 2101 et seq., the
California Worker Adjustment and Retraining Notification Act, California Labor Code §
1400, et seq., and the California Business & Professions Code. Id. ¶¶ 39–134. Plaintiff
seeks to represent a class defined as:
All of Defendants’ California-based sales agents who were classified
as independent contractors on or before April 30, 2024, and whose
relationship with Defendants was terminated as part of a mass layoff
or plant closing involving Assurance IQ on or about April 30, 2024.
Id. ¶ 26.
B. 	Superior Court Lawsuit (Chung)
On November 13, 2025, Defendants moved to stay this action pending the
resolution of an earlier filed putative wage and hour class and representative PAGA state
court action, Chung v. Assurance IQ, LLC (“Chung”), Case No. 34-2023-00337274,
currently pending in Sacramento County Superior Court. ECF No. 23 at 2. Plaintiff
opposed the motion, and Defendants filed a reply. ECF Nos. 25, 26. At the Court’s
direction, the Parties subsequently filed reports as to the status of the Chung case. ECF
Nos. 28, 29.
The Chung case was filed in San Diego Superior Court on April 3, 2023.1 ECF No.
24-1. As alleged in the Second Amended Complaint, the plaintiff in Chung worked for
1 The Court grants the Parties’ respective requests for the Court to take judicial
notice of court records filed in Chung. See Harris v. Cty. of Orange, 682 F.3d 1126, 1132
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defendant Assurance from April 2022 to June 2022 as an insurance agent. ECF No. 24-4
¶ 8. Similar to the instant action, Mr. Chung alleges that he and other class members were
misclassified as independent contractors and asserts claims under the California Labor
Code and California Business & Professions Code. Id. at ¶¶ 16, 	31–103. He seeks to
represent a class defined as:
All persons who worked for any Defendant in California as insurance
agents that were classified as independent contractors at any time
during the period beginning October 30, 2020 and ending when notice
to the Class is sent.
Id. ¶ 24.
On January 16, 2026, the parties in Chung filed a notice of settlement indicating
that the action had “been settled on a class and representative basis” with respect to “the
claims alleged in the Second Amended Complaint,” that the parties had “fully executed a
longform settlement agreement,” and that the plaintiff anticipated filing a motion for
preliminary approval with the state court within the next seven to fourteen days. ECF No.
28 at 7.
II. 	ANALYSIS
In the instant Motion, Defendants seek a discretionary stay of this case under
Landis v. North American Co., 299 U.S. 248 (1936). ECF No. 23 at 16–20. Plaintiff
contends Defendants have not carried their burden of establishing that a Landis stay is
warranted. ECF No. 25 at 4–10.
A “district court possesses inherent authority to stay federal proceedings pursuant
to its docket management powers.” Pub. Emps. Ret. Ass’n of N.M. v. Earley (In re PG&E
Corp. Sec. Litig.), 100 F.4th 1076, 1085 (9th Cir. 2024) (internal quotation marks
omitted). “[T]he power to stay proceedings is incidental to the power inherent in every
(9th 	Cir. 	2012) 	(“We 	may 	take 	judicial 	notice 	of 	undisputed 	matters 	of 	public
record, including documents on file in federal or state courts.”) (internal citation omitted).
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court to control the disposition of the causes on its docket with economy of time and
effort for itself, for counsel, and for litigants.” Landis, 299 U.S. at 254. “The decision to
stay proceedings ‘calls for the exercise of judgment, which must weigh competing
interests and maintain an even balance.’” In re PG&E Corp. Sec. Litig., 100 F.4th at 1085
(quoting Landis, 299 U.S. at 254–55).
The Ninth Circuit has identified three non-exclusive factors courts weigh when
deciding whether to issue a Landis stay: (1) “the possible damage which may result from
the granting of a stay”; (2) “the hardship or inequity which a party may suffer in being
required to go forward”; and (3) “the orderly course of justice measured in terms of the
simplifying or complicating of issues, proof, and questions of law which could be
expected to result from a stay.” Lockyer v. Mirant Corp., 398 F.3d 1098, 1110 (9th Cir.
2005); see In re PG&E Corp. Sec. Litig., 100 F.4th at 1085. “The proponent of a stay
bears the burden of establishing its need.” Clinton v. Jones, 520 U.S. 681, 708 (1997).
Here, the orderly course of justice favors granting a limited stay. Both the instant
action and the Chung are putative wage-and-hour and representative PAGA actions
brought 	on 	behalf 	of 	insurance 	agents 	in 	California 	against 	defendant 	Assurance.
Compare ECF No. 5 ¶¶ 25–26, 125–134 with ECF No. 24-4 ¶¶ 22–24, 96–103. Both
actions are predicated on the same core allegation—that plaintiffs and other putative class
members were misclassified as independent contractors. Compare ECF No. 5 ¶ 18 (“[O]n
information and belief, DEFENDANTS employed approximately 1700 insurance sales
agents nationwide, including several hundred 	in the State of California, including
PLAINTIFF, all of which were misclassified as independent contractors, as alleged
herein.”) with 24-4 ¶ 16 (“Plaintiff and the Class were misclassified as independent
contractors, 	when 	in-fact 	Plaintiff 	and 	the 	Class 	should 	have 	been 	classified 	as
employees.”). Based on the current class definitions, Plaintiff is a member of the putative
class in Chung, and the putative class here is a subset of the putative class in Chung.
Compare ECF No. 5 ¶ 26 with ECF No. 24-4 ¶ 24.
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Although the instant action asserts some additional claims, “[w]here a stay is
considered pending the resolution of another action, the court need not find that two cases
possess identical issues, only that the issues are substantially similar.” Jackson v. Marten
Transp., Ltd., No. 5:24-CV-02368-AH-(DTBX), 2025 WL 342083, at *2 (C.D. Cal. Jan.
30, 2025). Notably, the instant action is in its initial stages—while the Chung action has
been pending for over two years and is substantially further along, with the Parties
indicating that they have reached a proposed settlement on a class and representative
basis. ECF No. 28 at 6–7. For these reasons, a limited stay in light of the proposed
settlement in Chung would likely simplify the claims in this case, significantly narrow
their scope, or potentially resolve or release them altogether. See Franklin v. Scripps
Health, No. 22-CV-367-MMA (MDD), 2022 WL 4389691, at *5 (S.D. Cal. Sept. 21,
2022) (staying class action in light of parallel state court proceedings where action was
“largely duplicative” of pending state court actions and “it would be inefficient for the
Court and the parties to proceed with this case in the wake of the [state court actions]”);
Lapa v. Massage Envy Franchising, LLC, No. 19-CV-02694-MMC, 2019 WL 3891523,
at *2 (N.D. Cal. Aug. 19, 2019) (staying case in light of overlapping class action as final
approval of settlement “would not only simplify the issues, proof, and questions of law
. . . but would fully resolve them”); Meints v. Regis Corp., No. 09CV2061 WQH (CAB),
2010 WL 625338, at *3 (S.D. Cal. Feb. 16, 2010) (“Allowing Plaintiff to proceed to class
discovery in this case when a settlement potentially barring her class action is pending
would waste judicial resources[.]”); Clardy v. Pinnacle Foods Grp., LLC, No. 16-CV-
04385-JST, 2017 WL 57310, at *4 (N.D. Cal. Jan. 5, 2017) (holding that “potential
efficiency gains” resulting from a stay “are particularly heightened where, as here, the
class actions involve overlapping claims and class periods”).
The remaining Landis factors also weigh in favor of a limited stay. Requiring
Defendants to proceed simultaneously in two overlapping class action cases may result in
unnecessary hardship here, where one action has already progressed to settlement. See
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Paredas v. Garda CL W., Inc., No. 1:25-CV-00781-EPG, 2025 WL 3718812, at *3 (E.D.
Cal. Dec. 23, 2025) (“[H]aving to litigate potentially duplicative claims, which may be
resolved soon, would impose a burden on Defendant and the Court, resulting in a
needless use of resources.”); Lapa, 2019 WL 3891523, at *2 (staying case in light of
overlapping class action as otherwise defendant would “be required to expend resources
to defend a class action that, although pending court approval, it already has settled”).
Although Plaintiff contends he will suffer prejudice because staying this action
while Chung proceeds will delay resolution of his claims, “it is hardly surprising or unfair
that [Plaintiff’s] case will have to wait in line for an earlier-filed class action brought by a
substantially similar putative class asserting substantially similar claims.” Murillo v.
Target Corp., No. LACV2303033JGBMRW, 2023 WL 4553597, at *12 (C.D. Cal. July
14, 	2023). 	Likewise, 	Plaintiff’s 	concerns 	about 	delaying 	discovery—including 	the
possibility of lost evidence or fading witness memories—are speculative. See In re Bank
of Am. California Unemployment Benefits Litig., No. 21MD2992-GPC(MSB), 2024 WL
4219987, at *5 (S.D. Cal. Sept. 17, 2024) (noting defendant’s “concerns about delaying
discovery 	due 	to 	the 	risk 	of 	witnesses’ 	memories 	fading, 	witnesses 	relocating 	or
becoming unavailable, and evidence becoming stale or dissipating are speculative and no
evidence has been provided that such risks exist”).
Finally, any damage to Plaintiff would be mitigated here as the stay the Court
contemplates is limited. The settlement notice in Chung indicates that the plaintiff in that
case 	anticipates 	filing 	a 	motion 	for 	preliminary 	approval 	shortly. 	Under 	these
circumstances, while Defendants request a stay until Chung is fully resolved, the Court
finds that a more limited, time-bound stay is appropriate and will revisit the length of stay
as necessary.
III. 	CONCLUSION
For the foregoing reasons, Defendants’ motion for stay is GRANTED IN PART.
The action is STAYED pending the earlier of: (1) the grant or denial of a motion for
preliminary approval of class action settlement in Chung; or (2) six months from the date
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of this Order. The Parties shall file a joint status report with this Court within seven days
of the occurrence of either event. In any case, the Parties shall file a joint status report no
later than April 27, 2026.
IT IS SO ORDERED.
Dated: January 27, 2026
____________________
Hon. Robert S. Huie
United States District Judge
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