Employment Class Action Blog

Employment Class Action Blog

Information and Commentary on Class Action Cases Affecting Employers

Supreme Court Continues Sanctions Litigation Against the EEOC

Posted in EEOC

A slap in the face, maybe, after 11 years

Back in 2005, a prospective driver for a trucking company filed a charge with the EEOC contending that two trainers sexually harassed her during an over-the-road trip. That charge triggered a lawsuit in which the EEOC went on to claim that over 250 other women had been harassed, and that the company had a “pattern and practice” of such harassment. Serious allegations but, it turns out, ones that for the most part lacked evidence. Further much of the case was dismissed either because of the Commission’s own conduct in discharging its obligation to conciliate or occurrences such as the refusal of at least 100 of the alleged victims to appear for depositions. These matters resulted in the dismissal of virtually all of the claims and sanctions against the Commission of over $4 million. We’ve blogged aspects of this case at least three times (3/21/2012, 4/20/2011, and 10/7/2013). The Eighth Circuit ultimately reversed those sanctions because many of the claims were dismissed on procedural grounds rather than specifically on the merits. This created a conflict among the circuits and the Supreme Court accepted certiorari last year. Continue Reading

Standing Together to a Point: Spokeo Holding Reflects Broad Supreme Court Agreement on Standing Rules in Actions Raising Statutory Violations

Posted in FCRA

supreme court iStock_000000865139_LargeAmid the meteoric rise of statutory damage class action filings, the Supreme Court laid out ground rules on Monday for when a case meets both components of the injury-in-fact requirements of Article III.

In a 6-2 opinion in Spokeo, Inc. v. Robins, No. 13-1339, written by Justice Samuel Alito, the Court held that a named plaintiff in a federal class action complaint cannot establish Article III standing solely by alleging a statutory violation that carries with it a statutory damage provision. None of the justices, including the two dissenters, disagreed with that. Those types of allegations have become commonplace recently in federal courts by way of Telephone Consumer Protection Act (“TCPA”) and Fair Credit Reporting Act (“FCRA”) class actions. Both statutes carry statutory damage provisions without requiring proof of actual damages. After the Ninth Circuit held that standing was properly established based on an alleged FCRA violation, the Spokeo certiorari petition was essentially a challenge to such a class action procedure. Although the Supreme Court clearly delineated the standing requirements for statutory damage plaintiffs, the effect of its holding is unlikely to drastically curtail the statutory damage class action trend.

In remanding Spokeo to the Ninth Circuit, the Court held that the appellate court correctly determined that the Spokeo plaintiff, Thomas Robins, alleged a particularized injury to satisfy the injury component of Article III standing. But the Court held a particularized injury alone is not sufficient. Importantly, the Court noted in a footnote that a class action “adds nothing to the question of standing, for even named plaintiffs who represent a class ‘must allege and show that they personally have been injured, not that injury has been suffered by other, unidentified members of the class to which they belong.’” Op. at 6-7, n. 6 citing Simon v. Eastern Ky. Welfare Rights Organization, 426 U.S. 26, 40 n. 20 (1976). Rather, the injury must be concrete and particularized. And it noted that a concrete injury can include intangible harm that did not exist prior to its Congressional creation by way of a statute such as the FCRA or TCPA. Because the Ninth Circuit did not address whether Robins’ injury was sufficiently concrete, that is, “‘real’ and not ‘abstract,’” remand was necessary to consider “both aspects of the injury-in-fact requirement.” Continue Reading

Balancing Transparency and Secrecy in Class Action Settlements

Posted in Class Action Fairness Act

Companies have the right to protect their trade secrets against public disclosure, while class action members (and the judges who must determine the fairness and adequacy of proposed class action settlements) have the right to know the potential value of their claims. At times, as seems to be the case with respect to the proposed $100 million class action settlement between Uber Technologies, Inc. and its drivers in California and Massachusetts in O’Connor v. Uber Technologies, Inc., 13 CV-03826 (N.D. Cal.), these respective rights can clash.

On the one hand, before he approves the proposed class action settlement, the United States District Court Judge in the O’Connor case is required by Rule 23(e) of the Federal Rules of Civil Procedure to determine whether the settlement is fair and adequate; information that appears to be relevant to this determination in the O’Connor case are such things as the most recent valuation of Uber as a company, as well as data on the number of miles logged by drivers, gross fares, and service fees on fares. Not surprisingly, on the other hand, and although Uber is keen to see the proposed class action settlement approved, Uber contends that all of this is trade secret information/data and should be shielded from public disclosure by means of sealed court records.

Interestingly, class counsel for the plaintiffs in the O’Connor case took no position on whether what Uber contends is trade secret information should be sealed. The District Court Judge, though, is not yet convinced of the propriety of sealing records containing such information and has ordered the parties’ counsel to “explain why the potential value of the claims should not be publicly disclosed given the importance of this information in the court’s determination of the fairness and adequacy of a proposed class action settlement.” Continue Reading

California Supreme Court Tells Employers to Sit a Spell While Courts Review Individual Factors for Suitable Seating

Posted in Class Certification

“Shut the door. Have a seat.” The phrase immediately conjures emotions from the recipient. Most likely, life-changing (typically bad) news is about to be imparted. For Mad Men fans, it harkens to the third-season finale when the partners decide to split and start their own firm (and when Betty finally tells Don to take a hike). For the employees of California forced to stand to perform their jobs, however, the California Supreme Court has given “have a seat” a refreshing new meaning.

Two separate lawsuits comprise the pillars of the decision handed down in Kilby v. CVS Pharmacy, Inc., 63 Cal. 4th 1 (Cal. 2016). Nykeya Kilby worked as a clerk and cashier for CVS Pharmacy, Inc. During her shift, she moved around the store stocking shelves, assisting customers, gathering carts, arranging display cases, cleaning, and removing trash. Despite these tasks, however, she spent most of her time running the register. She was required to stand to do so. Continue Reading

Collado v. J & G Transport, Inc. – When a Waived Right to Arbitrate is Revived

Posted in Arbitration, FLSA

Some may have thought that once waived, the right to arbitrate is gone forever. No so! The Eleventh Circuit decision in Collado v. J & G Transport, Inc., No. 15-14635 (11th Cir. April 21, 2016) is but the latest example.

In that case, Enrique Callado initially filed a collective action under the Fair Labor Standards Act (FLSA) alleging that J & G Transport, Inc. failed to pay its drivers for working overtime. In June 2014 Collado filed an amended complaint alleging that as a truck driver for J & G he worked approximately 85 hours a week hauling garbage, debris, and mulch. Collado claimed that J & G made its drivers sign an independent contractor agreement in an attempt to circumvent the FLSA’s overtime requirements. He sought compensatory and liquidated damages for himself and similarly situated employees who did not receive overtime pay.  Continue Reading

Statistics in Wage and Hour Class Actions: Has Anything Really Changed?

Posted in FLSA, Wage and Hour

The probability is “not really”

Statistics are kind of a holy grail of class action litigation. Everyone seems to know that they exist, but their understanding is shadowy and the quest to find valid statistical models often proves elusive. Last month’s Supreme Court decision in Tyson Foods, Inc. v. Bouaphakeo, Case No. 14-1146 (Mar. 22, 2016), certainly addressed the topic, and while it will likely increase the number of attempts to use statistical data, their actual use will likely remain limited.

The Tyson Foods case (which is much easier to say than “Bouaphakeo”) was one of many donning and doffing cases brought over the past several years in the slaughterhouse industry. In this particular case, the claim was that the employer failed to compensate employees for the time they spent donning and doffing various pieces of protective gear. The type of gear varies among the types of work actually being done. In addition, the actual amount of time worked by the employees (such as whether they worked any overtime with or without the doffing time) also varied. The district court ultimately certified classes under the FLSA and Iowa state law, and the case proceeded to trial. Continue Reading

Sixth Circuit Adopts Bright Line Test for CAFA Removals

Posted in Class Action Fairness Act

Eyeglass case provides focus for employment class action removals

Congress enacted the Class Action Fairness Act, better known as “CAFA,” to address some of the well-documented abuses of class action litigation. Among CAFA’s important provisions is one permitting defendants to remove class actions to federal court when there are over 100 potential class members and the amount in controversy exceeds $5 million. 28 U.S.C. section 1332(d). A case must be removed under CAFA within 30 days after the defendant receives a document from which it can ascertain that the amount in controversy requirement has been met. 28 U.S.C. section 1446(b)(3).

From the time of CAFA’s inception, plaintiffs’ counsel have often looked for ways to prevent removal by, for example, failing to identify the amount in controversy or trying to stipulate that the amount of controversy is actually less than the $5 million removal threshold. Some myopic courts similarly sought to impose a high standard for removal or to require the submission of evidentiary materials to establish that the dispute did, indeed, involve more than $5 million. Fortunately, the Supreme Court put an end to several of these tactics in Standard Fire Insurance Co. v. Knowles, 133 S. Ct. 1345 (2013) and Dart Cherokee Basin Operating Co., LLC v. Owens, 135 S. Ct. 547 (2014). We blogged about those decisions here. The upshot is that to remove under CAFA, the defendant does not need to attach evidence (it need only allege the basic facts in the removal notice) and its submission in the notice of removal need only demonstrate the amount in controversy by a preponderance of the evidence. Continue Reading

New York District Court Grants Summary Judgment for Employer in Gawker Intern Case

Posted in Class Certification, FLSA

Litigation Over Interns Dries Up Internship Opportunities

The natural and probable consequence of litigation over unpaid internships was that such opportunities would disappear because the risk of litigation for even a legitimate program would outweigh the likely benefit. The result of the much-touted Gawker intern litigation underscores that reality.

We’ve blogged about the Gawker intern litigation (Mark v. Gawker Media LLC, Case No. 13-cv-4347 (AJN) (S.D. N.Y.) at least twice before. The lawsuit was originally brought in 2013 by two individuals who had had unpaid internships for Gawker Media, a company that runs blogs like Gawker, Jezebel, and io9. The crux of the claim, like that of most of the recent spate of internship cases, was that the interns were actually employees and entitled to the minimum wage and overtime under the FLSA and state law. The court conditionally certified a class under section 16(b) of the FLSA on August 15, 2014. We discussed that decision here. Later, issues arose regarding the means of providing notice to the class through the broad use of social media, which the court significantly limited. We blogged the court’s decision on those issues here. In addition to the two original plaintiffs, 17 former interns opted in. The parties then filed various cross-summary judgment motions, and the plaintiffs sought certification of a New York state law class under Rule 23. Continue Reading

Tyson Foods, Inc. v. Bouaphakeo: The Supreme Court Produces a Narrow Holding Involving FLSA Precedent and Rule 23 Principles

Posted in FLSA, Rule 23

paycheckiStock_000018636518_LargeEmployees have been bringing wage-and-hour collective actions since long before class procedures were officially integrated into the Federal Rules of Civil Procedures in 1966. Section 16(b) of the Fair Labor Standards Act (FLSA) permitted collective actions when it was passed in 1938. In 1946, the Supreme Court in Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680 (1946), amplified that power by holding that employees, after establishing class-wide liability, were entitled to a reasonable inference based upon representative sampling to compute class member damages. Section 16(b) was amended in 1947 to establish more rigorous requirements for collective actions, including the opt-in requirement. See Hoffman-LaRoche Inc., 493 U.S. 165, 173 (1989).

As FLSA collective action litigation bubbled over in the past decade, citations to Mt. Clemens followed. But the rule remained that the plaintiffs first had to establish the existence of class-wide liability, and only then did Mt. Clemens permit a just and reasonable inference regarding damages.

That long-standing rule received a contemporary update this week when the Supreme Court issued its opinion in Tyson Foods, Inc. v. Bouaphakeo, 577 U.S. __ (2016). For the first time, the Court condoned relying on Mt. Clemens’ reasonable inference to use statistical sampling to establish liability as well as damages in an FLSA collective action. Continue Reading

The Fifth Circuit Addresses an Issue That Refuses to Die: Who Determines Whether Class or Collective Arbitration Is Available?

Posted in Arbitration, FLSA

We opined on several occasions that cases dealing with a party’s entitlement to class or collective arbitration were a dying breed because of the increased use of class action waivers. And we have been proven wrong by several subsequent decisions. (See our November 11, 2013, March 12, 2015 and September 9, 2015 blog articles dealing with “gateway issues” and class arbitration.) Recently, the Fifth Circuit was confronted with the question in Neffertiti Robinson v. J&K Administrative Management Services, Incorporated, Case No. 15-10360 (5th Cir. Mar. 17, 2016), a case alleging unpaid overtime wages under the Fair Labor Standards Act (FLSA).

Based on the breadth of the contract language, the appellate court concluded there was “unambiguous evidence” of the parties’ intention to submit arbitrability disputes – including disputes over whether class or collective arbitration is available – to the arbitrator. Continue Reading