Tag Archives: 29 U.S.C. § 216(b)

D.Nev.: Statute of Limitations Tolled for Employees Who Opted Into First-Filed Case Where Conditional Certification Was Denied (and Their Consents Were Dismissed)

Orduna v. Champion Drywall, Inc.

This case was before the court on multiple motions, including plaintiff’s motion for tolling the statute of limitations. As discussed here, the precise issue before the court was what effect, if any, a plaintiff’s consent to join—filed in a prior lawsuit where conditional certification was ultimately denied, and such consent was dismissed—has on such opt-in’s statute of limitations. Electing to treat the motion as one for equitable tolling, the court held that such circumstances amounted to “extraordinary circumstances” such that equitable tolling was warranted. However, the court tolling the statute of limitations only for such time that the consent to join was filed with the court in the prior case, prior to dismissal.

The court reasoned, in part:

Plaintiffs assert that because they filed their consents to sue in a timely manner in Champion I, the statute of limitations for those claims should be equitably tolled to the date on which each plaintiff filed his or her consent. Defendants argue that plaintiffs’ motion should be denied or, in the alternative, tolling should only apply from the date that each plaintiff filed his or her consent until the date of the court’s denial of certification in Champion I on March 27, 2012. The court agrees with defendants’ latter position…

Upon decertification of the collective [action], therefore, it is critical to preserve opt-in plaintiffs’ ability to timely file individual actions.” Sliger v. Prospect Mortgage, LLC, 2012 WL 6005711 (E.D.Cal. Nov.30, 2012).

The Ninth Circuit has recognized the doctrine of equitable tolling of an FLSA claim. Partlow v. Lewis Orphans’ Home, Inc., 645 F.2d 757, 760 (9th Cir.1981), abrogated on other grounds, Hoffman–La Roche Inc. v. Sperling, 493 U.S. 165, 110 S.Ct. 482, 107 L.Ed.2d 480 (1989). Such tolling “applies when the plaintiff is prevented from asserting a claim by wrongful conduct on the part of the defendant, or when extraordinary circumstances beyond the plaintiff’s control made it impossible to file a claim on time.” Id. at 60. The doctrine of equitable tolling preserves a plaintiff’s claims when strict application of the statue of limitations would be inequitable. See United States v. Patterson, 211 F.3d 927, 930 (5th Cir.2000). Equitable tolling applies only in “rare and exceptional circumstances,” Teemac v. Henderson, 298 F.3d 452, 457 (5th Cir.2002), and should be applied sparingly. Steed v. Head, 219 F.3d 1298, 1300 (11th Cir.2000).

Applying this reasoning, the court granted the plaintiffs’ motion.  However, it limited tolling to the period of time in during which the opt-ins’ consents had been filed in the prior case:

Here, plaintiffs have not shown that the statute of limitations should be equitably tolled past the court’s denial of certification in Champion I. Plaintiffs claim that they did not know that the court would not grant the collective certification in that case, and that to preserve their rights, each plaintiff in a collective action would have to file individual actions at the same time they filed their consents to sue. The failure to predict the outcome of a motion for collective certification is experienced by each FLSA collective action litigant, and the possibility that diligence would be required in the filing of an individual claim if a collective action was denied or de-certified neither amounts to extraordinary circumstances nor a situation out of a plaintiff’s control.

Click Orduna v. Champion Drywall, Inc. to read the entire Opinion.

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N.D.Ala.: Arbitration Agreements Obtained By Defendant in Required Meetings After Putative Collective Commenced Unenforceable

Billingsley v. Citi Trends, Inc.

This case was before the court following the court’s order prohibiting enforcement of arbitration agreements that the defendant obtained from opt-ins (prior to the time they opted in to the case). The court previously had ruled that such arbitration agreements were unenforceable, because of the manner in which they were obtained from current employees, following an evidentiary hearing regarding same. This case is particularly important because it addresses the common situation in which a defendant-employer, at least arguably, crosses the line from attempting to mount a defense to a potential collective/class action, and begins to improperly exercise its unequal power over its current employees/putative class members. Denying the defendant’s motion for reconsideration, the court expanded on the reasoning of its prior order.

As the court explained:

This Fair Labor Standards Act case presents the court with a dilemma: enforce arbitration agreements against Defendant Citi Trends Store Managers, who are potential opt-in Plaintiffs in this collective action that were obtained during the conditional certification stage of this case and gut the collective action mechanism Congress provided for the protection of employees or refuse to enforce the arbitration agreements and run afoul of the federal policy favoring their enforcement. Because of the particular events surrounding the roll-out of the arbitration agreement in this case, as specifically discussed below, the court finds it cannot approve employer conduct like that involved in this case specifically targeting only potential class members during a critical juncture in this case with the definite goal of undercutting the Congressional intent behind the collective action process. The court will DENY the Defendant’s motion to compel arbitration and preserve the viability of the collective action mechanism.

Summarizing the parties’ respective contentions, the court explained:

Defendant Citi Trends, Inc. argues that this court’s ruling at the January 2013 hearing that it could not seek to compel arbitration against those opt-in Plaintiffs who signed mandatory arbitration agreements was an error of law. The Plaintiffs argue that the court’s ruling was appropriate and necessary to correct Citi Trends’s wrongful action—intimidating its employees into waiving their rights to join this lawsuit by signing mandatory arbitration agreements. On April 19, 2013, the court granted the motion to reconsider its ruling and set an evidentiary hearing to hear evidence surrounding presentment of the arbitration agreements to determine if any coercion, duress, or intimidation occurred.

While the court had previously denied the plaintiff’s motion for protective order and/or to strike declarations obtained from current employees, that was not the end of its inquiry as to whether the arbitration agreements should be enforced. Rather, the court held an evidentiary hearing because the

high standard had not been met on the parties’ submission alone, and thus, the court decided it needed to hold a hearing to determine if any coercion, duress, intimidation, or other abusive conduct occurred at the time SMs were required to sign the Agreement. The question of enforcement of or invalidation of the Agreement invokes a different standard than did the motion to strike or to enter a protective order, which was the requested relief before the court previously.

The court summarized the evidence received at the hearing as follows:

At the evidentiary hearing on May 14 and 15, 2013, the court heard testimony from opt-in Plaintiffs Roilisa Prevo and Katina Alfred, former Citi Trends SMs; Ivy Council, Executive Vice President of Human Resources for Citi Trends; Rashad Luckett, Human Resources Coordinator for Citi Trends; Vanessa Davis, Director of Human Resources for Citi Trends; and LaKesha Wilkins, an “independent third party witness” hired by Citi Trends to sit in SM meetings with Ms. Davis. The court will briefly summarize that testimony here but will also reference it as needed in the discussion below.

Citi Trends devised and implemented its new ADR policy in the late spring and early summer of 2012—shortly after it was served with the complaint on February 27, 2012 (doc. 6), and after the court on May 16, 2012, set a scheduling conference for May 31, 2012. (Doc. 17). On May 31, 2012, this court issued a Scheduling Order requiring the Plaintiffs to file their motion for conditional certification of the class on or before July 31, 2012 with briefing to be completed by September 10, 2012. (Doc. 18). Just a couple weeks after the Order, in mid-June, Citi Trends began the process of rolling out its new Alternative Dispute Resolution (“ADR”) plan, including the mandatory Agreement. Ms. Davis testified that as of mid-June she had virtually completed the new employee handbook she was working on, which did not include an ADR policy; she learned for the first time in mid-June that the updated handbook would include the new ADR policy. Citi Trends, under the direction of Ms. Council, sent Ms. Davis, Mr. Luckett, and other HR representatives to have two-on-one private meetings with SMs across the country as early as June 30, 2012 to roll out the new ADR policy. The HR representatives met with all SMs individually throughout the summer.

District Managers (“DMs”) told the SMs that they must attend the meetings that concerned the issuance of a new employee handbook. DMs were only asked to sign the Agreement if the HR Representatives happened to see them at the SM meetings, but Citi Trends distributed the Agreement to DMs, other corporate employees, and store associates at a later date.

When the SMs arrived at the meetings, they were greeted by an HR Representative and another individual, who Ms. Prevo claimed was never introduced to her and whom Ms. Alfred identified as another Citi Trends corporate employee. The HR Representatives gave the SMs four documents: the SM Disclosure, the Agreement, the SM Declaration, and a photocopied version of a new employee handbook. The two-on-one private meetings took place in small, back rooms in Citi Trends retail stores, the same places where interrogations or investigations of employees occurred. The HR Representatives who met with the SMs played an advisory role in the employment decisions of Citi Trends employees, and both Ms. Prevo and Ms. Alfred testified that they believed the HR representatives conducting the meetings had authority to make employment decisions about them, such as hiring and firing.

Ms. Alfred and Ms. Prevo testified that they signed the documents but came away from those meetings having felt intimidated by the HR Representatives and pressured to sign the Agreement or lose their jobs. The SMs were not given copies of the documents they signed at the meeting or at anytime afterward, even if they specifically requested copies.

After finding the agreements at issue to be both procedurally and substantively unconscionable, the court weighed the related public policy concerns as well:

The biggest public policy concern that the court has to consider about actions of Citi Trends, however, is the effect of the Defendant’s efforts on the purpose of an FLSA collective action. The court’s decision on this issue is bigger than this one case, and that concern is what has plagued the court about this situation from the first mention of the Agreement. The purposes of the FLSA and its collective action procedure factor into the court’s decision on this motion.

Congress passed the FLSA during the Great Depression to protect workers from overbearing practices of employers with greatly unequal bargaining power over them. See Roland Elec. Co. v. Walling, 326 U.S. 657, 668 n. 5 (1946) ( “The Bill was introduced May 24, 1937, [and] … accompanied by a Presidential message by Franklin D. Roosevelt …. ‘to protect the fundamental interests of free labor and a free people we propose that only goods which have been produced under conditions which meet the minimum standards of free labor shall be admitted to interstate commerce. Goods produced under conditions which do not meet rudimentary standards of decency should be contraband and ought not to be allowed to pollute the channels of interstate trade.’ “) (quoting 81 Cong. Rec. 4960, 4961). To further that purpose, § 216(b) of the FLSA authorizes an employee to file suit for and on behalf of himself and others similarly situated. See 29 U.S.C. § 216(b). Those employees who wish to join the lawsuit must give written consent or opt-in to the lawsuit, but they only know that they can do so once court-approved notice has been sent to them. See id…

In this case, the court finds that such goals are defeated if the court approves actions taken by defendants, such as those taken by Citi Trends in this case, that are designed and used to prevent employees from vindicating their rights in an FLSA collective action. The court wishes to make clear that it is not addressing a pre-lawsuit or pre-employment arbitration agreement between an employer and employee that would preclude participation in a collective action. Instead, this ruling only addresses the Agreement in this case that was presented to the specifically-targeted potential class of employees in the specific manner that gave those potential opt-in Plaintiffs no meaningful choice or known opportunity to refuse to sign without the fear of termination in a setting that was ripe for and calculated to produce perceived intimidation or coercion and when its very purpose and effect was to preclude participation in this lawsuit.

For these reasons, the court finds that the Agreement at issue in this case reeks of both procedural and substantive unconscionability in the context in which it was presented and obtained. The Agreement cannot and will not be enforced against Ms. Prevo, Ms. Alfred, or Ms. Cunningham, and the court will DENY Citi Trends’s motion to compel arbitration against them. In making this decision, the court notes that it found the testimony presented by the Defendant, specifically that from Ms. Council and Ms. Davis, particularly enlightening. In addition to the language of the documents themselves, the court finds that the concurrent timing of the ADR roll-out and the Plaintiffs’ preparation of the motion for conditional certification and court approved notice, and the manner in which the Agreement was presented weigh in favor of invalidating the Agreement as it relates to the SMs who were presented the Agreement during its initial roll-out in the summer of 2012.

The court truly believes it would be a derogation of the court’s responsibility if it were to approve employer conduct like that in this case that specifically undercuts the Congressional intent behind creating the FLSA collective action process for aggrieved employees, and the court does not take such action lightly.

In light of this reasoning, the court denied the defendant’s motion for reconsideration and held that the arbitration agreements, obtained from current employees were unenforceable.

Click Billingsley v. Citi Trends, Inc. to read the entire Memorandum Opinion.

A review of the docket shows that the defendant has filed an appeal to the Eleventh Circuit.  Thus, this issue will likely get further review.  Stay tuned for further developments….

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U.S.S.C.: Where Named Plaintiff Acknowledged That Unaccepted OJ Mooted Her Claim, Collective Action Mooted and May Not Proceed

Genesis Healthcare Corp. v. Symczyk

What effect, if any, does an unaccepted “full relief” offer of judgment have on the ability of a named plaintiff to continue with his or her putative collective action claims under the FLSA? This was the question FLSA practitioners had eagerly awaited the answer of from the Supreme Court, ever since the Court accepted certiorti of the Symczyk v. Genesis Healthcare Corp. However, in a decision of almost no real world value, the Court elected to dodge this question and instead answer its own hypothetical question/issue, so limited in scope, that Justice Kagan (in her dissent) points out, it has absolutely no value in practical application. For this reason, at least one practitioner surveyed regarding the opinion stated, “I don’t care about this decision at all.  Really pretty meaningless.”  In order to understand why such a seemingly important opinion actually means so little we must examine exactly what the Court decided and on what facts it made its decision.

As stated by the Court, its actual holding was that:

a collective action brought by single employee on behalf of herself and all similarly situated employees for employer’s alleged violation of the Fair Labor Standards Act (FLSA) was no longer justiciable when, as conceded by plaintiff-employee, her individual claim became moot as result of offer of judgment by employer in amount sufficient to make her whole.

Describing the relevant facts the Court explained:

In 2009, respondent, who was formerly employed by petitioners as a registered nurse at Pennypack Center in Philadelphia, Pennsylvania, filed a complaint on behalf of herself and “all other persons similarly situated.” App. 115–116. Respondent alleged that petitioners violated the FLSA by automatically deducting 30 minutes of time worked per shift for meal breaks for certain employees, even when the employees performed compensable work during those breaks. Respondent, who remained the sole plaintiff throughout these proceedings, sought statutory damages for the alleged violations.

When petitioners answered the complaint, they simultaneously served upon respondent an offer of judgment under Federal Rule of Civil Procedure 68. The offer included $7,500 for alleged unpaid wages, in addition to “such reasonable attorneys’ fees, costs, and expenses … as the Court may determine.” Id., at 77. Petitioners stipulated that if respondent did not accept the offer within 10 days after service, the offer would be deemed withdrawn.

After respondent failed to respond in the allotted time period, petitioners filed a motion to dismiss for lack of subject-matter jurisdiction. Petitioners argued that because they offered respondent complete relief on her individual damages claim, she no longer possessed a personal stake in the outcome of the suit, rendering the action moot. Respondent objected, arguing that petitioners were inappropriately attempting to “pick off” the named plaintiff before the collective-action process could unfold. Id., at 91.

The District Court found that it was undisputed that no other individuals had joined respondent’s suit and that the Rule 68 offer of judgment fully satisfied her individual claim. It concluded that petitioners’ Rule 68 offer of judgment mooted respondent’s suit, which it dismissed for lack of subject-matter jurisdiction.

Although discussed in detail by Justice Kagan in her dissent, the Court’s majority opinion, penned by Justice Thomas ignored the fact that the plaintiff actually received no money, no judgment and no settlement as a result of the unaccepted offer of judgment. Nonetheless, the Court reasoned, because the plaintiff had ostensibly stipulated at the district court that her claim was mooted by the unaccepted offer of judgment, and she had failed to cross-appeal to the Supreme Court (a decision which was entirely in her favor), the Court refused to entertain the plaintiff’s argument that the unaccepted OJ could not have mooted the case in the first place. Instead, charging ahead, under the false pretense that the unaccepted OJ had in fact mooted the plaintiff’s individual claim, the Court went on to hold that under such (imagined) circumstances, a defendant could “pick off” an FLSA collective action, where the plaintiff has not sought conditional certification of a collective action at the time he or she receives an offer of judgment that he or she acknowledges moots his or her individual claim.

While the Court’s majority went to great length to distinguish the collective action mechanism of 216(b) from the Rule 23 class action mechanism on which the reasoning of Circuit Courts have relied in reaching the opposite conclusion, the Court failed to acknowledge it was deciding an issue that was really not even before it, and in practicality unlikely to ever appear before any court ever again.

In a stinging must-read dissent Justice Kagan pointed this out and ridiculed the conservative majority for essentially wasting everyone’s time with a meaningless opinion. The Court ultimately failed to answer the real issue of interest- what effect does an unaccepted “full relief” offer of judgment have on the ability of a named-plaintiff to pursue a collective action.  As Justice Kagan noted, the text of Rule 68 dictates it should have no effect at all.  Pointing out that the plaintiff had actually received no recovery in the case, because the offer of judgment at issue was not accepted, Kagan went reasoned, the majority’s opinion had virtually no application outside of the contrived facts on which it was based. Kagan began:

The Court today resolves an imaginary question, based on a mistake the courts below made about this case and others like it. The issue here, the majority tells us, is whether a ” ‘ collective action’ ” brought under the Fair Labor Standards Act of 1938 (FLSA), 29 U.S.C. § 201 et seq., “is justiciable when the lone plaintiff’s individual claim becomes moot.” Ante, at ––––. Embedded within that question is a crucial premise: that the individual claim has become moot, as the lower courts held and the majority assumes without deciding. But what if that premise is bogus? What if the plaintiff’s individual claim here never became moot? And what if, in addition, no similar claim for damages will ever become moot? In that event, the majority’s decision—founded as it is on an unfounded assumption—would have no real-world meaning or application. The decision would turn out to be the most one-off of one-offs, explaining only what (the majority thinks) should happen to a proposed collective FLSA action when something that in fact never happens to an individual FLSA claim is errantly thought to have done so. That is the case here, for reasons I’ll describe. Feel free to relegate the majority’s decision to the furthest reaches of your mind: The situation it addresses should never again arise.

Although this was a case watched most by FLSA practitioners for obvious reasons, it is a case which further highlights the absurd pro-big business mentality employed by today’s conservative majority on the court. In fact, as an aside Kagan took another parting shot at the similarly limited opinion just issued by the court in the Comcast case. (In footnote 2 to her dissent, she notes, “[f]or similarly questionable deployment of this Court’s adjudicatory authority, see Comcast Corp. v. Behrend, 569 U.S. ––––, ––––, 133 S.Ct. 1426, 1437, ––– L.Ed.2d –––– (2013) (joint opinion of GINSBURG and BREYER, JJ.) (observing in dissent that “[t]he Court’s ruling is good for this day and case only”).”).

In sum, this decision will leave practitioners scratching their heads. It is unclear what, if any, actual effect it will have on future cases. For this reason, one has to wonder- why did the Court take up the case in the first place.  It would seem that absent a stipulation by a plaintiff that his or her case is mooted by a Rule 68 offer of judgment (which in fact is an impossibility) or an acceptance of such an offer of judgment, a defendant still may not moot a putative collective action with an offer of judgment.

Click Genesis Healthcare Corp. v. Symczyk to read the Court’s entire opinion and Justice Kagan’s dissent.

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E.D.N.Y.: Named-Plaintiff’s Failure to File Consent to Join Not Fatal to Collective Action, Where Defendants Acknowledged Intent to Proceed as Collective Action in Answer and Plaintiff Filed Sworn Affidavit

Ahmed v. T.J. Maxx Corp.

This case was before the court on the plaintiff’s motion to conditionally authorize a collective action, pursuant to Section 216 of the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 201 et seq. As discussed here, the court held that the plaintiff had “commenced” his FLSA case for the purposes of serving as the representative plaintiff in a collective action, notwithstanding his initial failure to file a formal consent to join, as required by 216(b), by virtue of the defendant’s admissions regarding same in their answer and the fact that plaintiff filed an sworn (signed) affidavit in support of his motion.

Discussing the issue, the court explained:

Defendants maintain, as an initial matter, that Ahmed’s case cannot proceed as a collective action because Ahmed himself has not filed a consent form as required by section 216(b) of the FLSA. (Defendant’s Memorandum of Law in Opposition to Plaintiff’s Motion for Conditional Certification, hereinafter “Def. Mem. of Law in Opp’n”, at 19.) It is defendant’s position that the FLSA requires a plaintiff—even a named plaintiff—to opt-in to his or her own action in order to proceed as a collective action. (Id.)

Although the cases upon which defendants rely provide that all plaintiffs must affirmatively opt in to a suit in order to proceed as part of a collective action, see, e.g. Gonzalez v. El Acajutla Restaurant, Inc., No. 04 Civ. 1513, 2007 U.S. Dist. LEXIS 19690, at *14–15 (E.D.N.Y. Mar. 20, 2007), courts in this Circuit have held that the FLSA itself does not require such written consent in order for a plaintiff to file a motion for conditional certification, see, e.g. Aros v. United Rentals, Inc., 269 F.R.D. 176, 181 (D.Conn.2010) (“The court concludes that denying the Motion for Conditional Certification … would undermine the FLSA’s broad remedial purpose”). Moreover, “[t]he purpose of this consent requirement … is to put the Defendants on notice, which many courts have noted is somewhat redundant with regard to named plaintiffs,” particularly when the named plaintiff has submitted sworn affidavits to the court, participated in depositions, and otherwise taken necessary action to pursue his claims and demonstrate that he “intends to participate in the lawsuit.” D’Antuono v. C & G of Groton, Inc., No. 11 Civ. 33, 2012 U.S. Dist. LEXIS 49788, at *6–7, 10–11 (D.Conn. Apr. 9, 2012).

Given that defendants expressly acknowledged, in their answer, that Ahmed purports to bring this action “pursuant to FLSA, 20 U.S.C.s. 216(b), on behalf of ‘Assistant Mangers’ employed in T.J. Maxx stores” (see Answer at ¶ 8), it cannot be said that defendants lacked notice of Ahmed’s consent, nor can it be said that defendants were unaware of Ahmed’s intent to pursue his claims as part of a collective action, particularly as Ahmed has already participated in a deposition and has submitted an affidavit in support of the instant motion. Consequently, while the form of Ahmed’s consent may not have strictly adhered to the preferred standard in FLSA collective actions, the substance of Ahmed’s complaint and his conduct throughout the discovery process was sufficient to satisfy the purpose of the written consent requirement. Furthermore, since defendants first raised this issue, Ahmed has filed a formal written consent with the Court. At this point, Ahmed is in compliance with not only the spirit, but also the letter of the written consent requirement. Thus, this Court finds that defendants had sufficient notice of Ahmed’s intent to proceed with a collective action, and this Court will therefore consider Ahmed’s request for conditional certification as a collective action on its merits.

Click Ahmed v. T.J. Maxx Corp. to read the entire Memorandum Opinion and Order.

While this case is certainly helpful to practitioners in the situation where the named-plaintiff has not filed a consent to join, as a practical matter (especially in courts outside of the Second Circuit), the best practice is to file a consent to join on behalf of all plaintiffs and opt-in plaintiffs, including the named-plaintiffs, to avoid the necessity of even addressing this issue.  Further, it should be noted that even in this case, the named-plaintiff ultimately did file a consent to join, after the issue had been raised by the defendants in their opposition to his motion for conditional certification.

EDITOR’S NOTE:  Within days of the Ahmed decision, another court- this one in the Eleventh Circuit- was faced with a similar issue.  In that case the plaintiff had actually styled his complaint as an individual claim, excluding language that he sought to proceed on a collective action basis.  Nonetheless, the court held that the defendants had adequate notice of plaintiff’s intent to proceed as a collective action, and ultimately granted plaintiff’s motion for conditional certification.  See  Hogan v. Allstate Beverage Co., Inc., 2012 WL 6027748, at *5 (M.D. Ala. Dec. 4, 2012).

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M.D.Tenn.: Defendants’ Request to Have Putative Class Opt Into Specific Claims, As Opposed to the Case as a Whole Rejected

Ware v. T-Mobile USA

This case was before the court following an order that conditionally certified the case as a collective action. The plaintiffs alleged that they performed uncompensated work prior to the commencement of their shifts and during their unpaid meal breaks. They also alleged that the defendant underpaid employees by failing to include certain required payments in the regular rate of pay when it calculated overtime. The plaintiffs claim that, by failing to compensate employees for pre-shift work and work performed during unpaid meal breaks and by miscalculating the regular rate of pay, the defendant violated the Fair Labor Standards Act (“FLSA”). In the Memorandum Opinion in which it conditionally certified the case, the court also ordered the parties to confer and attempt to submit agreed-upon-notice and consent forms.  Whereas the plaintiffs proposed a relatively basic consent to join form, the defendant took the position that each opt-in plaintiff should be required to specifically opt-in to one or both of the specific claims alleged by the plaintiffs. Rejecting the defendant’s proposed approach and adopting that of the plaintiffs- whereby opt-ins could simply opt into the case as a whole- the court explained:

T–Mobile urges the court to adopt its proposed consent form. It asserts that the form merely attempts to obtain otherwise discoverable information from the opt-in plaintiffs concerning the specific claims they intend to assert. (Docket No. 108, at 2–3.) T–Mobile adds that gaining this information from the consent form will reduce the costs of written discovery. (Id. at 3.)

The plaintiffs raise numerous objections to T–Mobile’s proposed consent form. Chief among them is that the form is contrary to the plain language of the FLSA. (Docket No. 111, at 2.) The remaining objections raised by the plaintiffs include that T–Mobile: (1) is attempting to re-litigate the issue of conditional certification through the questions contained in its proposed consent form; (2) seeks information from opt-in plaintiffs lacking the benefit of counsel that is properly obtainable through discovery; and (3) urges the approval of a consent form that will confuse opt-in plaintiffs. (Docket No. 111, at 5–6, 8–13.) The plaintiffs thus request that the court adopt their proposed consent form, as they contend that it is clear, concise, and lacks any misleading information. (Docket No. 111, at 7–8.)

Having considered the parties’ contentions, the court finds that the text of the FLSA’s statutory provisions settles the instant dispute. The relevant provision provides, in pertinent part, that:

An action to recover the liability prescribed in either of the preceding sentences may be maintained against any employer … in any Federal or State court of competent jurisdiction by any one or more employees for and in behalf of himself or themselves and other employees similarly situated. No employee shall be a party plaintiff to any such action unless he gives his consent in writing to become such a party and such consent is filed in the court in which such action is brought. 29 U.S.C. § 216(b) (emphasis added). The plain language of this statutory text expressly provides that, in filing a written consent form, an opt-in plaintiff joins an action to redress his or employer’s statutory liability. Indeed, Section 216(b) lacks any requirement that opt-in plaintiffs consent to join specific claims within the broader action.

In Prickett v. Dekalb County, 349 F.3d 1294, 1297 (11th Cir.2003), the Eleventh Circuit Court of Appeals interpreted the aforementioned statutory text in the same manner. The issue before the court in that case concerned whether opt-in plaintiffs were required to submit new consent forms after the named plaintiffs added a claim to the original complaint. Prickett, 349 F.3d at 1296. In concluding that the filing of new consent forms was not required, the Eleventh Circuit commenced its analysis by examining the text of 29 U.S.C. § 216(b). Id. at 1296–97. It noted that the plain language of Section 216(b) “indicates that plaintiffs do not opt-in or consent to join an action as to specific claims, but as to the action as a whole.” Id. at 1297 (emphasis added). The Eleventh Circuit added that, by referring to opt-in plaintiffs as “party plaintiffs,” “Congress indicated that opt-in plaintiffs should have the same status in relation to the claims of the lawsuit as do the named plaintiffs.” Id. See also Fengler v. Crouse Health Sys., Inc., 634 F.Supp.2d 257, 262–63 (N.D.N.Y.2009) (citing Prickett for this proposition and vacating a Magistrate Judge’s decision to include a paragraph in the consent form that limited the opt-in plaintiffs’ claims to only one of two asserted in the complaint).

After rejecting the defendant’s attempt o distinguish Prickett and Fengler, the court reasoned:

In the instant case, T–Mobile’s proposed consent form compels opt-in plaintiffs to make a decision that the FLSA does not mandate, that is, it requires them to select the specific claims they wish to assert. T–Mobile can readily obtain information concerning such claims after the opt-in plaintiffs have joined this action by using any one of the discovery devices contained in the Federal Rules of Civil Procedure. Indeed, in correspondence exchanged between the parties’ counsel prior to the filing of the proposed consent forms, counsel for T–Mobile acknowledged the availability of targeted interrogatories as a means of ascertaining the specific claims each opt-in plaintiff plans to assert in this lawsuit. (Docket No. 115, Ex. E.) In any event, because T–Mobile’s proposed consent form fails to comply with the FLSA’s express requirements, the court declines to approve it for delivery to members of the nationwide conditional class.

Click Ware v. T-Mobile USA to read the entire Memorandum and Order.

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C.D.Cal.: Motion for Corrective Action Granted Where Defendant Provided Insufficient Info to Putative Class Members When Obtaining Releases

Gonzalez v. Preferred Freezer Services LBF, LLC

This case was before the court on the plaintiff’s motion for corrective action, under Federal Rules of Civil Procedure 23, on grounds that the defendant had improperly contacted potential plaintiffs to this putative class action in efforts ‘to obtain releases from its employees concerning the claims pled by [Gonzalez] in this action.’ The plaintiff sought an order requiring the defendant to release the names and contact information of individuals from whom the defendant had attempted to extract releases. The court granted the plaintiff’s motion, applying Rule 23’s protections to an FLSA case.

The court described the relevant facts/procedural history as follows:

Gonzalez brought a collective action on behalf of himself and other of Preferred Freezer’s employees for unpaid overtime pay under California law and the Fair Labor Standards Act, 29 U.S.C. § 216(b). (Mot.2.) In August 2012, Preferred Freezer unilaterally drafted a “Release Agreement” that it provided to its employees, who are potential plaintiffs to this putative class action. (Mot.6–7.) The Agreement explained that in exchange for a settlement payment “in full satisfaction of all claims that Employee has, had or could have had arising out of the lawsuit or in any way related thereto,” the employee waived any and all claims arising out of a “former employee[‘s]” wage-and-hour lawsuit or in any way related to the lawsuit. (Mot.7.) But the Release Agreement did not state when this unnamed lawsuit was filed, the name of the former employee, the names of the employee’s attorneys, the attorneys’ contact information, or the period of time covered by the release. (Id.)

The court explained that the plaintiff learned of the defendant’s actions that were the subject of the motion, when a putative class member who had been approached by the defendant contacted plaintiff’s counsel. After discussing the general concept that settlements are favored, the court explained how the manner in which the defendant obtained the general releases here was misleading:

The waiver Preferred Freezer tendered its employees was misleading in many ways. It did not include any information regarding this class action, except that a former employee had brought a lawsuit against Preferred Freezer. (Sinay Decl. Exs. A, B.) The waiver did not attach the Complaint, any information on when the case was filed, nor any information regarding the essence of the case. (Mot.7.) Preferred Freezer also did not include Gonzalez’s counsel’s contact information. (See Gamez Decl. Ex. 1.) Even when Preferred Freezer’s agents spoke to the potential plaintiffs, the agents never provided them with the name of the case. (Gamez Decl. ¶ 6.) Furthermore, Preferred Freezer’s counsel never contacted Gonzalez’s counsel to confer over possible communication to Preferred Freezer’s employees regarding the potential settlement. (Mot.6.) Thus, the waiver misleadingly failed to provide the potential plaintiffs with adequate notice of this case in order to make an informed decision regarding waiver of their rights.

While the facts surrounding the manner in which the defendant had obtained the releases were uncontested, the defendant argued that corrective action was inappropriate and that: (1) defendant’s first amendment right to communicate with the putative class should not be hindered; (2) putative class members of a 216(b) collective actions are not entitled to the same protections as those in a Rule 23 class action; (3) the DOL supervised the settlements at issue; and (4) they did provide enough information to the settling class members, so as to alleviate concerns that the releases were obtained based on misleading information.

Noting that the plaintiff was not seeking to invalidate the releases at this juncture, and was not seeking to stop the defendant from communicating with putative class members, the court granted the plaintiff’s motion. The court granted the plaintiff’s motion as follows:

In response to Preferred Freezer’s misleading contact with putative class members in this action, Gonzalez asks that the Court orders Preferred Freezer to provide names, addresses, and telephone numbers for each and every person contacted by Preferred Freezer regarding the waiver. (Mot.25.) Gonzalez also requests that any communication to potential plaintiffs should include all the important information relating to Gonzalez’s case. (Mot.24.) For the reasons discussed above, the Court finds this request reasonable and therefore GRANTS Gonzalez’s motion.

Preferred Freezer is therefore ORDERED to provide Gonzalez with the contact information of all of those prospective plaintiffs in this case with whom Preferred Freezer has had contact regarding settlement. Furthermore, any communication that either party has with putative plaintiffs must include the following information: (1) the name of this case; (2) the case number; (3) a summary of the basis of Gonzalez’s claims; (4) the name of Gonzalez’s attorneys and their contact information; and (5) a statement concerning the effect of executing Preferred Freezer’s released documents will have on its employees’ ability to participate in this lawsuit.

Click Gonzalez v. Preferred Freezer Services LBF, LLC to read the entire Order Granting Plaintiff’s Motion for an Order for Corrective Action.

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D.Md.: Compensatory Damages for Emotional Distress Are Available Under §§ 215 and 216(b) for Retaliation Claims

Randolph v. ADT Sec. Services, Inc.

This case was before the court on several pretrial motions of the parties. As discussed here, among the issues briefed before the court was whether compensatory damages are available to a plaintiff-employee pursuing a claim of retaliation under the FLSA. The court answered this question in the affirmative, noting the issue was one of first impression within the Fourth Circuit.

Restating the parties’ respective positions, the court explained:

ADT maintains that, as a matter of law, Plaintiffs are precluded from seeking emotional distress damages because such damages are unavailable under “the very similar damages provision of the ADEA.” (ECF No. 101, at 18). Plaintiffs disagree, pointing to several circuit court opinions upholding such awards. On this issue, Plaintiffs have the better end of the argument.

The court noted that the issue presented was one of first impression in the Fourth Circuit and then examined case law from other circuit and district level courts:

Neither the Fourth Circuit nor any district court within this circuit has previously determined whether a plaintiff may recover compensatory damages from emotional distress in an FLSA action. Four circuit courts of appeal—the Sixth, Seventh, Eighth, and Ninth Circuits—have, however, either directly or indirectly addressed the issue, and all have permitted the recovery of emotional distress damages. Moore v. Freeman, 355 F.3d 558, 563–64 (6th Cir.2004) (explaining that “consensus on the issue of compensatory damages for mental and emotional distress [in FLSA cases] seems to be developing”); Broadus v. O.K. Indus., Inc., 238 F.3d 990, 992 (8th Cir.2001) (upholding a compensatory award that may have included damages for emotional distress); Lambert v. Ackerley, 180 F.3d 997, 1011 (9th Cir.1999) (affirming an award of emotional distress damages in an FLSA action); Avitia v. Metro. Club of Chi., Inc., 49 F.3d 1219, 1226–30 (7th Cir.1995) (reducing an award for emotional distress damages after finding the award excessive, but noting that such damages are available under the FLSA (citing Travis, 921 F.2d at 111–12)).

The compensatory nature of the remedies in § 216(b) supports the outcome in these cases. “The [FLSA’s] statutory scheme contemplates compensation in full for any retaliation employees suffer from reporting grievances.” Moore, 355 F.3d at 563 (citing Snapp, 208 F.3d at 934; Lanza, 97 F.Supp.2d at 740); Republic Franklin Ins. Co. v. Albemarle Cnty. Sch. Bd., 670 F.3d 563, 568 (4th Cir.2012) (citing Snapp and Lanza for the proposition that the relief provided in § 216(b) “is compensatory in nature”). The text of § 216(b) expressly provides for “such legal or equitable relief as may be appropriate to effectuate” this compensatory purpose, employing the broad phrase “without limitation” to indicate that the enumerated remedies within that section are not exhaustive. 29 U.S.C. § 216(b). “[L]ike the forms of relief mentioned [therein], damages for mental anguish are intended to compensate the injured party for harm suffered.”   Moore, 355 F.3d at 564.

Certainly, an argument could be made that the availability of liquidated damages [under § 216(b) ] would be sufficient to fully compensate a plaintiff with proof of actual economic damages but only minor, subjective mental anguish occasioned by an employer’s violation of the [FLSA]. However, in a case involving only nominal economic losses but proved retaliation consisting of concerted, directed harassment, resulting in grave emotional distress, such nominal economic damages or the available doubling of those damages would be insufficient to make the plaintiff whole. Damages for mental anguish would be the necessary compensatory legal relief “appropriate to effectuate the purposes of [the anti-retaliation provision].” Bogacki v. Buccaneers Ltd. P’ship, 370 F.Supp.2d 1201, 1203 (M.D.Fla.2005) (quoting 29 U.S.C. § 216(b)); cf. Snapp, 208 F.3d at 937 (reasoning that “district courts may have to exercise some creativity in awarding relief in retaliation cases” beyond those forms set forth in the statutory text).

The court then rejected the contrary holdings of courts that had held ADEA cases to be persuasive based upon the fact that the ADEA was patterned after the FLSA, noting that such reasoning:

fails to consider that the relief authorized under both statutes must be determined ‘not in isolation, but in conjunction with the other provisions of the Act[s], the policies they further, and the enforcement framework[s] they envision.’ Dean, 559 F.2d at 1038.” The court further distinguished the ADEA legislative framework by pointing out that “[t]he ADEA includes an administrative conciliation process that is critical to its enforcement framework… [and] [l]ooking to this process, circuit courts have repeatedly held that emotional distress damages are unavailable in ADEA actions because they would impede mediation and conciliation by discouraging early resolution of ADEA claims.

Thus, the court concluded:

Because “full compensation is the evident purpose and paramount policy” in an FLSA retaliation action, “the more reasoned approach” would permit a plaintiff who makes a proper showing to recover damages for emotional distress. Id.; Moore, 355 F.3d at 563–64. Neither party here has addressed the strength or weakness of Plaintiffs’ evidence of alleged emotional distress. Until the parties do so at trial, the court cannot conclude—as a matter of law—”that damages for mental anguish should be disallowed.” Id. at 1205–06.  Plaintiffs will be permitted to seek emotional distress damages through a jury trial, and their motion on this issue will, therefore, be granted.

In light of the continuing disagreement of courts regarding this issue, this might be one to watch for further appellate level developments in the future.

Click Randolph v. ADT Sec. Services, Inc. to read the entire Memorandum Opinion.

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