Posts belonging to Category Certification Rulings

In what appears to be the first class certification ruling to expressly invoke the California Supreme Court’s recent Brinker decision, Central District judge Anthony J. Battaglia has certified meal period, rest break, expense reimbursement, wage statement, untimely final paycheck, and off-the-clock claims. See Schulz v. QualxServ LLC, No. 09-CV-17-AJB (C.D. Cal. Apr. 26, 2012) (order granting motion for class certification), available here. Thus, although Brinker only addressed meal period, rest break, and off-the clock claims, the decision is also a strong endorsement of class action procedures to adjudicate wage-and-hour claims in general.

As to the often-pivotal commonality requirement, Judge Battaglia found it satisfied, citing the same authorities relied on in Brinker:

The Court finds that there are sufficient common questions under this standard because Plaintiffs’ challenge the Defendants’ common corporate policy of failing to relieve the technicians of all work during the rest and meal breaks. Adoma, 270 F.R.D. at 552-53 (noting unsettled California law but finding class issues predominate on meal periods); Dilts, 267 F.R.D. at 634-39 (certifying class of off-site truck drivers who worked through meal and rest breaks based on company-wide, common practice); Ortega, 258 F.R.D. at 366-70 (common questions predominate because focus on employer’s “compensation system, which applies in the same manner to all potential class members on all work days,” regardless of California Supreme Court’s decision on meaning of duty to “provide” rest and meal breaks); Cervantez, 253 F.R.D. at 576 (certifying class on common corporate policy concerning rest and meal breaks); see Jaimez v. DAIOHS USA, Inc., 181 Cal. App. 4th 1286, 1305 (2010) (certifying class under California rules).

Order at 11-12.

This action alleges that the class of field technicians, whose duties included driving to clients’ homes and businesses to repair and service computers, were paid only a flat rate for making repair calls and were not relieved of duty during meal and rest breaks (which were also not properly recorded). See id. at 2-4, 11-12. Defendants countered that, due to the nature of the job, the technicians were fully in control of their own breaks. See id. at 6. While Brinker struck a note for worker autonomy, Schulz suggests the limits of such autonomy, particularly where an employer cedes virtually all responsibility for supervising and administering breaks to workers.

In a recent ruling, U.S. District Court Judge John G. Koeltl granted conditional certification per FLSA Section 216(b) of a nationwide class of “personal bankers” who alleged that Citibank failed to pay them overtime.  See Winfield v. Citibank, No. 10 Civ. 7304, 2012 U.S. Dist. LEXIS 16449 (S.D. N.Y. Jan. 27, 2012) (available here).

The Winfield decision augments the growing body of law rejecting the application of Dukes v. Wal-Mart to motions for conditional certification under the FLSA.  Whereas Dukes was decided under Rule 23, which requires the predominance of common questions of law or fact, FLSA Section 216(b) requires only that all employees be “similarly situated.”  In Dukes, the Supreme Court took issue with the allegations of a single employee who sought to represent a nationwide class of employees against whom Wal-Mart had allegedly discriminated, holding that a plaintiff must establish that her class claims can be proven by reference to a common policy.  By contrast, in Winfield, the plaintiffs offered testimony that regional management resisted paying overtime wages, while also enforcing sales quotas that resulted in overtime hours.  This established that the plaintiffs were subject to a “common policy or plan that violated the law” for the purposes of 216(b).  Winfield v. Citibank, 2012 U.S. Dist. LEXIS 16449 at *19-22.

In opposing conditional certification, Citibank argued that “the plaintiffs are not similarly situated to one another and to other potential opt-in plaintiffs because their testimony reveals inconsistencies regarding the plaintiffs’ motives for working overtime; how much overtime, if any, they were paid; and what job duties they performed, among other purported discrepancies.”  Id. at *16-17.  However, Judge Koeltl found that Citibank was effectively posing the wrong question, as “the relevant ‘issue . . . is not whether Plaintiffs and [potential opt-in plaintiffs] were identical in all respects, but rather whether they were subjected to a common policy to deprive them of overtime pay when they worked more than 40 hours per week.’”  Id. at *16 (citing Raniere v. Citigroup, No. 11 Civ. 2448, 2011 U.S. Dist. LEXIS 135393, at *16 (S.D.N.Y. Nov. 22, 2011)).

The decision concludes that the plaintiffs met “their minimal burden of showing that they are similarly situated to one another and to potential opt-in plaintiffs.”  Id. at *17.

In an opinion authored by Judge Richard Posner, the Seventh Circuit has reversed a trial court’s order denying certification of Title VII race discrimination claims.  See McReynolds v. Merrill Lynch, No. 11-3639, (7th Cir. Feb. 24, 2012) (order reversing denial of certification) (available here).

In McReynolds, Merrill Lynch brokers alleged that their employer’s compensation policies had a discriminatory effect on African Americans.  Slip op. at 2.  Merrill Lynch argued that individualized circumstances predominated across the 700 class members, thereby precluding certification per Dukes v. Wal-Mart.  Slip op. at 17.

The plaintiffs had originally moved for class certification in 2010.  The district court denied that motion.  Slip op. at 3.  Then, in a seemingly counter-intuitive move, the plaintiffs renewed their motion based on the Supreme Court’s Dukes decision.  Slip op. at 11.  Again, the district court denied certification.  Slip op. at 11.  However, the district court also suggested that the plaintiffs appeal the ruling to determine how Dukes should affect the certification issue.  Slip op. at 11-12.  The Seventh Circuit accepted the Rule 23(f) appeal.

Writing for the Seventh Circuit, Judge Posner acknowledged that Dukes “may seem a perverse basis for a renewed motion for class certification, since the Supreme Court reversed a grant of certification in what the defendant in our case insists is just like this one.”  Slip op. at 11.  However, in contrast to Dukes, where “there was no company-wide policy to challenge,” Merrill Lynch’s policies were alleged to be company-wide and therefore better suited to a class action treatment.   Slip op. at 12-14.  The McReynolds panel rejected the defendant’s argument that any discrimination would result from the “local, highly-individualized implementation of policies rather than the policies themselves.”  Slip op. at 17.  Even assuming that the defendant’s policies were not intended to discriminate against African American employees, “[t]he incremental causal effect . . . of those company-wide policies—which is the alleged disparate impact—could be most efficiently determined on a class-wide basis.”  Slip op. at 17-18.

Should the plaintiffs succeed in their challenge, each of the class members may have to prove their compensation was adversely affected by the corporate policies in separate, individual actions.  Slip op. at 20-21.  Even so, the Seventh Circuit reasoned that judicial efficiency favored certification:

Obviously a single proceeding, while it might result in an injunction, could not resolve class members’ claims . . . . So should the claim of disparate impact prevail in the class-wide proceeding, hundreds of separate trials may be necessary. . . . But at least it wouldn’t be necessary in each of those trials to determine whether the challenged practices were unlawful.

Slip op. at 18-19. 

In addition to a significant holding that surprised many by reversing the denial of certification, the McReynolds decision also shows an unexpected side of Seventh Circuit Judge Richard Posner, owing to Judge Posner’s reputation as a “conservative.”  However, this opinion, together with Posner’s other judicial opinions, scholarship, and public pronouncements, indicates that he is perhaps more of an iconoclast than a conservative.  

The McReynolds opinion leaves open the prospect of class certification, where it might have otherwise been barred by Dukes, and as such may be influential beyond the Seventh Circuit.

The U.S. District Court for California’s Southern District has issued yet another certification ruling that limits the holding of Dukes v. Wal-Mart and contributes to the growing body of post-Dukes commonality jurisprudence.  See Johns v. Bayer Corp., 09-cv-1935, 2012 U.S. Dist. LEXIS 13410 (S.D. Cal. Feb. 3, 2012) (order granting class certification motion) (available here).  Additionally, the Johns decision confirms the prevalent view that, in consumer class actions, reliance need not be established for each class member on an individual basis.  Rather, classwide reliance can be presumed where a reasonable consumer would be deceived by the at-issue misrepresentations.  Id.

Southern District Court Judge Anthony Battaglia granted certification of a class of California consumers who allegedly paid a higher price for Bayer’s “Men’s 50+ Advantage” and “Men’s Health Formula” vitamins in reliance on Bayer’s claim that the products “support prostate health.”  Id at *2-4.  The Johns plaintiffs allege that “in truth, the vitamins did not provide any prostate health benefits.  In fact, according to Plaintiffs, recent clinical studies have shown that for some men, increased selenium consumption may increase their prostate cancer risk.”  Id. at *3.

Bayer opposed class certification, principally by focusing on the heightened commonality requirement set forth in Dukes.  Id. at *6-14.  Specifically, Bayer argued that the commonality requirement could not be satisfied because there were individualized questions regarding the plaintiffs’ actual reliance on Bayer’s purported misrepresentations, the materiality and timing of Bayer’s health claims, and the amount of damages suffered.  Id.

However, the Johns court rejected Bayer’s arguments, invoking Ninth Circuit authority for the proposition that California consumer laws “take an objective approach of the reasonable consumer, not the particular consumer.”  Id. at *12-13 (citing Williams v. Gerber Prods. Co., 552 F.3d 934, 938 (9th Cir. 2008)) (emphasis in original).  Thus, the key question is whether a reasonable consumer would have been misled by Bayer’s packaging, not whether each individual purchaser was misled.  Id. at *12-13.  In adopting the “reasonable consumer” standard and the presumption of classwide reliance, Johns is consistent with the emerging consensus among California’s federal courts.  See Wolph v. Acer, 272 F.R.D. 477 (N.D. Cal. Mar. 25, 2011) (class-wide reliance presumed from showing that misrepresentation is material to reasonable consumer).   

The Johns decision also addressed Dukes’ “due process” analysis and rejected Bayer’s argument that certification would deprive Bayer of the opportunity to raise defenses to individuals’ claims.  Echoing a similar decision against Bayer by an Ohio district court, the Johns court held that certification would not prevent Bayer from trying individualized defenses, and therefore Dukes did not bar certification.  Id. at *23 (discussing Godec v. Bayer Corp., 2011 LEXIS 131198, *7 (N.D. Ohio Nov. 11, 2011)).