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S.D.Fla.: Defendant May Not Seek SJ Against Individual Plaintiffs Where Case Remains Certified At Stage 2
Hernandez v. Starbucks Coffee Co.
In this case plaintiffs, “store managers” at Starbucks claimed they had been uniformly misclassified as exempt employees and wrongly denied overtime as a result. The case was before the court on defendant’s motion for summary judgment regarding 4 individual plaintiffs in the (certified) class—on the ground that these Plaintiffs offered generally consistent testimony that compels the conclusion that they are exempt “executive” employees as a matter of law. Significantly, prior to defendant filing its motion for summary judgment, the court had denied defendant’s motion to decertify the class. The court denied defendant’s motion, largely on the ground that it is inappropriate for a defendant to attempt to target individual plaintiffs for summary judgment, where the class is proceeding as a whole and liability will therefore be determined on a classwide rather than individual basis.
The court explained:
“Before reaching the merits of this argument, the Court must first consider whether it is even proper for Defendant to move for summary judgment as to selected individual Plaintiffs when the Court is presented with a collective action. Relying upon Hogan v. Allstate Ins. Co., 361 F.3d 621, 623 (11th Cir.2004), Defendant argues that where a “FLSA collective action has been conditionally certified but no ruling has been made as to whether the case will proceed to trial as a collective action, the district court may entertain summary judgment motions as to individual plaintiffs.” [DE–241, pg. 12]; see also Lindsley v. Bellsouth Telecomm., Inc., Case No. 07–6569, 2009 WL 322144, at *2 (E.D.La. Feb.9, 2009) (denying motion to strike motion for summary judgment against an individual, named plaintiff, finding it “appropriate to choose [the individual plaintiff] as a test plaintiff to resolve the issue of employee versus independent-contractor status.”).
In response, Plaintiffs argue that the Court should reject Defendant’s attempt to have its motion treated as one directed to only certain individuals, as opposed to the class as a whole, pointing to Judge Marra’s conclusion in Pendlebury v. Starbucks Coffee Company, Case No. 04–80521–CIV–KAM, DE–495 (S.D. Fla. filed Jan. 8, 2008). Plaintiffs point out that unlike Hogan, 361 F.3d at 623, neither this Court nor Plaintiffs have consented to a “test plaintiff” procedure, and Defendant cannot randomly select certain individual Plaintiffs and at the same time seek to prohibit Plaintiffs from using testimony from other Plaintiffs in order to oppose the entry of summary judgment. Defendant attempts to refute this argument by contending that Rule 56(a) permits it to seek summary judgment as to a claim or defense, or part of a claim or defense, and reiterates the holding in Hogan. Defendant also argues that Plaintiffs have not cited to any authority prohibiting the Court from considering such a motion where as here the Court has not yet conducted a stringent review of the propriety of collective treatment.
Importantly, subsequent to Defendant filing the instant motion for summary judgment, on June 28, 2011, this Court denied Defendant’s motion for decertification [DE–300], concluding that Plaintiffs are similarly situated and can proceed as a class. As such, the Court has now conducted a stringent review of the propriety of collective treatment and found collective treatment to be appropriate. Defendant’s reliance on Hogan as its basis for moving for summary judgment as to only four (4) individual Plaintiffs is misplaced. Defendant similarly attempted to raise this argument and rely on Hogan in filing its motion for partial summary judgment in Pendlebury. The Pendlebury court rejected Defendant’s argument, pointing out that in Hogan the court had specifically authorized the selection of test plaintiffs for purposes of discovery and motions for summary judgment. Case No. 04–80521–CIV–KAM, DE–495 at pg. 3. The court concluded that “allowing Defendant to move for summary judgment against particular individuals who are indistinguishable from other members of the class defeats the entire purpose of a collective action.” Id. at 5. Instead, the court held that since the action was certified as a collective action, the court would “only address dispositive motions that resolve common issues of law or fact as to the entire class or an identifiable subclass.” Id.
Similarly here, the Court has already concluded that collective treatment is appropriate and has not authorized the use of “test” plaintiffs. Instead it appears that Defendant unilaterally selected individuals as its “test” plaintiffs. Notably, Defendant does not argue that these Plaintiffs somehow represent a “subclass” or otherwise address the Pendlebury court’s ruling on this issue in any manner. Consequently, the Court finds that it is not proper for Defendant to move for summary judgment as to individual Plaintiffs given the Court’s recent conclusion that Plaintiffs shall proceed as a class.”
W.D.Va.: Parties May File FLSA Settlement Agreement Under Seal For Limited Time; Good Cause Demonstrated By 800 Similar Cases Pending
Murphy v. Dolgencorp, Inc.
This case is one of many such individual plaintiff cases pending against Dolgencorp (Dollar General), following the decertification of a nationwide collective action pertaining to its alleged misclassification of its “Store Manager” position. The case was before the court on the parties second motion seeking approval of settlements of these related cases under the Fair Labor Standards Act (FLSA). The court had previously denied approval because of the parties’ insistence on the confidentiality of the settlement terms without showing good cause. Murphy v. Dolgencorp, Inc., No. 1:09CV00007, 2010 WL 3766946 (W.D.Va. Sept. 21, 2010).
Permitting the parties to file the settlement under seal for a limited time, the court discussed its basis for doing so, under the limited and somewhat unique circumstances of the case:
“I continue to find that I cannot approve the settlements without knowing the terms thereof, although the parties continue to ask me to do so on that basis. As an alternative, they ask me to consider the written terms either secretly, in camera, or by having them stated orally in an open, but hopefully empty, courtroom.
As I earlier elaborated, these procedures preferred by the parties do not, in my opinion, conform to my responsibilities under the FLSA or under the law generally. See id., 2010 WL 3766946, at *1.
The parties suggest another alterative, which I eluded to in my earlier opinion, which is to file and seal the settlement agreements for a limited period of time. As good cause for such a procedure, they represent that there are approximately 800 similar cases pending against the defendant in this and other federal courts around the nation, in which all of the plaintiffs are represented by the same counsel. They contend that keeping the terms of other settlements from each of these plaintiffs is beneficial in order to allow negotiations to concentrate on the specific merits of each individual case. They represent that plaintiffs’ counsel have agreed that they will not divulge the terms of another settlement to any of their individual clients.
It is true, as the parties assert, that the individual facts of each case are significant. Indeed, I have so ruled in denying summary judgment for the defendant in Teresa Hale’s case. Hale v. Dolgencorp, Inc., No. 1:09CV00014, 2010 WL 2595313, at *2-3 (W.D.Va. June 23, 2010) (holding that to determine if an individual store employee is exempt from overtime under the FLSA’s executive exemption requires a fact-intensive inquiry, unique to each store’s situation). The issue in each of these cases is whether the employee’s primary duty is management, which requires an analysis of various factors, including the amount of time spent by the employee in managerial duties. Id. Among the many stores operated by the defendant, those factors vary based on the circumstances of each store, as well as the preferences and circumstances of the various district managers. Id. at 4.
Under these circumstances, I find that good cause has been shown to seal the settlement agreements for a limited period of time. While the parties suggest three years, I find that two years ought to allow the parties the opportunity to negotiate settlement in most cases, and adequately balances the needs of the parties with the presumptive right of the public to access court records.
Accordingly, it is ORDERED as follows:
1. In connection with the requested approval of the settlements of these two cases, the parties must file under seal copies of the settlement agreements, together with (a) the amount of the plaintiffs’ overtime and liquidated damages claims, and (b) the amount of attorneys’ fees and expenses paid from the settlements, together with the basis for the calculation of the attorneys’ fees; and
2. The materials described above will be filed under seal, not to be unsealed earlier than two years after filing.”
U.S. Supreme Court Will Not Hear Family Dollar Appeal Of $35 Million Verdict; Dow Jones Reports
Dow Jones is reporting that the, “The U.S. Supreme Court on Monday rejected Family Dollar Stores Inc.’s (FDO) appeal of a $35 million verdict in favor of store managers who said the company wrongly denied them overtime pay.
Family Dollar argued the managers were salaried employees who were not eligible for overtime pay under the [Fair Labor Standards Act (“FLSA”)]. The discount retailer also objected to letting the store managers bring their cases in one collective lawsuit.
More than 1,400 Family Dollar employees joined the case as plaintiffs. They argued that they were eligible for overtime pay because they performed few managerial duties and spent most of their time doing the same work as their hourly-wage subordinates.
An Alabama jury ruled for the workers in 2006 and the trial court entered a $ 35.6 million judgment against the company. A federal appeals court upheld the judgment last year. The Supreme Court rejected Family Dollar’s appeal without comment.”
Click here to read the original report.
N.D.Cal.: Dollar Tree Store Manager “SM” Rule 23 Class Certified For California SMs
Cruz v. Dollar Tree Stores, Inc.
Pursuant to Federal Rule of Civil Procedure 23, Plaintiffs move for an order certifying the following class: “All persons who were employed by Dollar Tree Stores, Inc. as California retail Store Managers at any time on or after December 12, 2004.” Starting the class period from December 12, 2004, ensures that any eventual awards to Dollar Tree Store Managers (“SMs”) in this case will not overlap with the awards that resulted from a previous settlement. Plaintiffs alleged the class consists of at least 655 members. Defendant contended that the number is likely to be less, and that there are currently 273 SMs in California.
Of note, was the Court’s analysis of the Predominance and Superiority requirements under Rule 23. The Court stated:
“Because all of Dollar Tree’s California SMs are required to perform a common set of tasks, Dollar Tree’s reliance on Sepulveda v. Wal-Mart Stores, Inc., is misplaced. 237 F.R.D. 229 (C.D.Cal.2006) rev’d in part, aff’d in part, 275 Fed. Appx. 672 (9th Cir.2008). In that case, the court found that individual questions predominate over common issues because of the “voluminous evidence that there actually was a great deal of variance in AM [Assistant Manager] duties … AM duties varied based on the characteristics of the store, its workforce, and the surrounding community.” Sepulveda, 237 F.R.D. at 249. Here, by contrast, Dollar Tree requires its SMs to certify every week that they spend most of their time performing a finite number of duties. Also, the class size in this case is considerably smaller than in Sepulveda, where there were approximately 2750 putative class members. Id. at 242.
Dollar Tree presents evidence suggesting variations in how SMs go about performing those tasks. For example, Dollar Tree submits a detailed comparison of twenty-five California stores showing they vary considerably in size, number of different products available for SMs to order, sales, and average monthly payroll hours. Dollar Tree filed a document showing the differing roles and experiences of California SMs. Dollar Tree submitted twenty SM declarations to show that SMs have substantially different day-to-day experiences and duties. Dollar Tree contrasts the deposition testimony of the Plaintiffs with the testimony of other SMs to show they perform their jobs in different ways. Dollar Tree also submits deposition testimony of SMs to show they have considerable autonomy and discretion in fulfilling their tasks and responsibilities.
Despite this evidence of variation, Dollar Tree does not, and cannot, deny that all California SMs are required to spend a majority of their time performing a set of seventeen tasks. See Tierno v. Rite Aid Corp., No. 05-2520, 2006 WL 2535056, at *9 (N.D.Cal. Aug. 31, 2006) (noting that Rite Aid’s self-audits and study, which were designed to show variations in how store managers performed specified tasks, also counted as concession “that a single set of tasks is applicable to all Store Managers”). For example, while one SM declares that he spent only thirty minutes per week preparing employee schedules, and another SM declares he spent four hours per week preparing employee schedules, this comparison also shows that both SMs spent time every week engaged in one of the common duties on the Payroll Certification, namely, “[ s] chedul[ ing] and assign[ ing] work to store personnel.” While one SM declares that he spent five hours per week hiring new employees, and another SM spent only thirty minutes per week on hiring, hiring is also one of the common duties on the Payroll Certification. This Court can resolve the question of whether SMs who spend most of their time performing these seventeen duties are exempt from California’s overtime laws. This question is a common one for all California SMs. There is therefore a clear justification for handling this dispute on a representative rather than an individual basis.
The Court notes the irony of relying on Dollar Tree’s certification process to find that the case is suitable for class-wide treatment, when Dollar Tree implemented that process after its earlier settlement, and precisely in order to ensure that its SMs were properly classified. Those certifications certainly support Dollar Tree’s contention that it is not liable for improperly classifying SMs. SMs will have to explain why they consistently certified “yes” on the Payroll Certifications if in fact they were spending most of their time stocking shelves and cashiering. However, that liability question is not presently before the Court, and a class certification motion is not an occasion to “advance [to] a decision on the merits.” See Moore v. Hughes Helicopters, Inc., 708 F.2d 475, 480 (9th Cir.1983). Here, the question is whether common issues predominate, and the fact that all California SMs share the same job description, which requires them to spend most of their time performing tasks on a list consisting of seventeen duties, supports the conclusion that they do.
Plaintiffs’ evidence of Dollar Tree’s standardized practices and procedures provides further evidence in support of the contention that common issues predominate. Dollar Tree’s training program for SMs is standardized throughout California. Dollar Tree’s SM training program for new hires lasts eight weeks, and its SM training program for assistant managers who are being promoted lasts four weeks. The corporate office in Virginia develops the written materials for the training program. Dollar Tree does not formally retrain SMs when they are transferred to other stores. SMs are given the same training, irrespective of which store they might be assigned to down the road.
SMs use common tools in performing their duties at Dollar Tree. SMs have online access to “plan-o-guides” which recommend, but do not require, that a certain kind of merchandise be displayed in a particular location. SMs can also access information and bulletins online via “Dollar Tree Central.” Using Dollar Tree Central, SMs can access newsletters, merchandising suggestions, forms, policies, and information relating to benefits. All store managers in California use a computer application called “COMPASS” to create schedules for their staff. Dollar Tree maintains an auto replenishment system which automatically generates orders for some products. Store managers are also encouraged to use a playbook, which provides information on ordering, scheduling, and basic general information about Dollar Tree.
Dollar Tree relies on Jimenez v. Domino’s Pizza, 238 F.R.D. 241 (C.D.Cal.2006), but the Court finds that the case is distinguishable. In Jimenez, the Court was not confronted with evidence of standardized policies and practices. 238 at 251-53. Where, as here, there is evidence that the duties of the job are defined by standardized procedures and policies, district courts have routinely certified classes of employees challenging their classification as exempt, despite arguments about individualized differences in job performance. See, e.g., Krzesniak v. Cendant Corp., No. 05-05156, 2007 WL 1795703, at *3 (N.D.Cal. Jun. 20, 2007) (branch managers at car rental chain); Alba v. Papa John’s USA, Inc., No. 05-7487, 2007 WL 953849, at *1 (C.D.Cal. Feb. 7, 2007) (store managers at pizza delivery chain); Whiteway v. FedEx Kinko’s Office and Print Services, Inc., No. 05-2320, 2006 WL 2642528, at *1 (N.D.Cal. Sep. 14, 2006) (managers at shipping and print services retail chain); Tierno, 2006 WL 2535056, at *5-10 (N.D.Cal. Aug. 31, 2006) (store managers at drug store chain). The Court finds that Plaintiffs have satisfied the prerequisite of predominance.”
Overtime Law Blog 