CALIFORNIA CLASS ACTION LAW

Category: 23(b)(2) Class

Northern District Denies Certification of Wage & Hour Class Action

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The Northern District of California denied class certification of a meal and rest break class action in Washington v. Joe’s Crab Shack, No. C 08-5551 PJH, 2010 WL 5396041 (N.D. Cal Dec. 23, 2010.) (slip op.).  Plaintiff Drew Garrett Washington asserted that defendant Crab Addison, Inc. (“Crab Addison”), a company that operates a number of Joe’s Crab Shack restaurants, failed to provide employees with meal and rest breaks, allowed its restaurant managers to manipulate employee time records to deprive employees of pay for all hours worked (including overtime and missed meal break pay), required employees to perform work “off the clock”; and required employees to pay for their own employer-mandated uniforms.  Id. *1.

Class Definition

Plaintiff moved pursuant to Federal Rule of Civil Procedure 23, to certify a plaintiff class consisting of “all non-exempt restaurant employees employed by Crab Addison at Joe’s Crab Shack restaurants in California from January 1, 2007, through the present.”

Discussion

The court denied the certification motion.  Id. *11.  “Plaintiff’s position is that common questions predominate because the main issue is whether—notwithstanding Crab Addison’s written policies—Joe’s Crab Shack restaurants in California followed a common unwritten policy of denying meal and rest breaks, failing to pay employees who did not take breaks, failing to pay for overtime, requiring employees to purchase their own uniforms, and so forth.” Id. Plaintiff contended that the existence of a policy or practice that in effect contradicts Crab Addison’s written policies can be ascertained by an analysis of the data in Crab Addison’s computer systems.  Id. “But since plaintiff has failed to adequately explain how that analysis works and exactly what the data shows, he has failed to adequately establish the existence of such a policy or practice.” Id. Read the rest of this entry »

Northern District Denies Class Certification, After Sustaining Objections to a Declaration Designed to Evade a Local Rule on Page Limits

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The United States District Court for the Northern District of California denied a motion for class certification for evading the page limit on briefing by relying on 11 pages of argument crammed into a supporting declaration.  Juarez v. Jani-King Of California, Inc., No. 09-3495 SC, 2010 WL 3766649 (N.D. Cal. Sept. 24, 2010).  Plaintiffs brought a putative class action arising out of the sale of franchises by Defendants Jani-King of California, Inc., Jani-King, Inc., and Jani-King International, Inc.  Id. *1.  Plaintiffs petitioned the Court for leave to file a brief exceeding Northern District of California’s Civil Local Rule 7-4(b)’s twenty-five-page limit, but the court denied the request. Id.

Plaintiffs filed their Motion to Certify, as well as sixty exhibits totaling more than four thousand pages in support of the Motion.  Id. Defendants filed objections to an eleven-page section of a declaration that Plaintiffs filed in support of their Motion.  Id.

The Statement of Facts in Plaintiffs’ motion cited almost exclusively to seventy-six paragraphs in this declaration.  Id. And in turn, these paragraphs cited to the evidence supporting the Motion.  The court gave the following example from the motion and declaration: Read the rest of this entry »

Ninth Circuit Affirms in All Respects Trial Court’s Entry of Judgment and Award of Attorneys Fees After Jury and Bench Trial of California Labor Code Class Action and FLSA Collective Action Claims

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On Monday, the U.S. Court of Appeals for the Ninth Circuit affirmed in “all respects” the trial court’s grant of partial summary judgment to plaintiffs, a judgment after jury and bench trials, and an award of attorney’s fees to plaintiffs.  Wang v. Chinese Daily News, Inc., Nos. 08-55483, 08-56740, — F.3d —-, 2010 WL 3733568 (9th Cir. Sept. 27, 2010).  Among other things, the Ninth Circuit held that plaintiff newspaper reporters were non-exempt. (Thank you to Randy Renick for bringing this case to my attention.)

Background

Employees of Chinese Daily News, Inc. (“CDN”), a Chinese-language newspaper, filed suit against CDN on behalf of current, former, and future CDN employees based in CDN’s San Francisco and Monterey Park (Los Angeles), California locations.  Id. *1.  Plaintiffs claimed violations of the FLSA, California’s Labor Code, and California’s Unfair Competition Law, Cal. Bus. & Prof. Code § 17200, alleging that employees were made to work in excess of eight hours per day and forty hours per week. Id. They further alleged that they were wrongfully denied overtime compensation, meal and rest breaks, accurate and itemized wage statements, and penalties for wages due but not promptly paid at termination. Id. The district court certified the FLSA claim as a collective action, and it certified the state-law claims as a class action under Rule 23(b)(2) and, alternatively, under Rule 23(b)(3). Id. Read the rest of this entry »

Wal-Mart Files Its Cert Petition in Dukes v. Wal-Mart

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Wal-Mart filed its cert petition last week of Dukes v. Wal-Mart Stores, Inc., 603 F.3d 571 (9th Cir. Apr. 26, 2010).  Sitting en banc, Ninth Circuit affirmed District Judge Martin J. Jenkins’ order certifying a Fed. R. Civ. P. 23(b)(2) class of current employees with respect to their claims for inclutive relief, declaratory relief, and back pay.  The petition presents 2 questions:

I. Whether claims for monetary relief can be certified under Federal Rule of Civil Procedure 23(b)(2)—which by its terms is limited to injunctive or corresponding declaratory relief—and, if so, under what circumstances. Read the rest of this entry »

Northern District of Illinois Denies Class Certification to Proposed Class of African American Financial Advisors at Merrill Lynch

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Judge Robert W. Gettleman denied class certification this week in McReynolds et al. v. Merrill Lynch, Pierce,  Fenner & Smith Inc., (N.D. Ill. Aug. 9, 2010), No. 05-06583, a case brought by 17 African American financial advisors who accused Bank of America Corp’s Merrill Lynch & Co. unit of racial discrimination in violation of Title VII of the Civil Rights Act of 1964 as amended, 42 U.S.C. § 2000(e) et seq. (Count I), and 42 U.S.C. § 1981 (Count II). Plaintiffs moved pursuant to Fed. R. Civ. P. 23 to certify a class, defined as:

African-American financial advisors (“FAs”) and FA Trainees (“Trainees”) who are or were employed in the retail brokerage unit, referred to as Global Private Client (“GPC”) of defendant Merrill Lynch, Pierce, Fenner & Smith, Inc., from January 2001 to the present.   cannot have their cases tried together.

The Court found a lack of commonality because the “individuals worked in different offices, had different supervisors, and allegedly experienced vastly different forms of discrimination.”  The Court found also found a lack of typicality becuase the claims of the named plaintiffs and the declarations of putative class members showed variations which would “necessitate individual inquires to determine whether the individual suffered racial discrimination.”  Additionally, the Court found that that defendant would be able to present varying defenses to the plaintiffs’ claims.

Plaintiffs sought certification under a hybrid of Rule 23(b)(2) and 23(b)(3), but the Court concluded that the proposed class failed under both Rules.  With respect to 23(b)(2), the Court found that “the individual putative class members’ financial interests are too high to be considered incidental to the requested equitable relief. Consequently, opt out rights must be extended to the members, and certification under Rule 23(b)(2) is inappropriate.”

With respect to certification under Rule 23(b)(3), the court found predominance lacking “[b]ecause plaintiffs’ statistical evidence alone is insufficient to establish company-wide discrimination in a manner that affects each class member in the same way, each individual putative class members’ claim for liability and damages will have to be tried to a jury. These inquiries would involve different witnesses and proofs for each member to determine, among other things, the motivation of each supervisor who made the individual allegedly discriminatory decision.”

The Court also found inappropriate a “divided certification, with certification of a 23(b)(2) class for the equitable issues and certification of a 23(b)(3) class for the damages issues . . . .”  “There is no predominance of common issues to certify a 23(b)(3) class for any issue, and even if there were, because of the right to a jury trial the damages cases would all have to be tried first, eliminating any advantage to certifying the instant case as a class action.”

Finally, the Court rejected “certification under Rule 23(b)(2) for all issues, combined with notice and an opportunity to opt out as though certified under Rule 23(b)(3) . . . .”  The Court noted that “certification under this approach is advantageous to plaintiffs, because it avoids Rule 23(b)(3)’s requirement that common issues predominate and that a class action be the superior method of resolving the dispute.”  “This court agrees with Judge Kennelly, however, that the Seventh Circuit’s suggestion of this approach in Lemon and Jefferson was not intended to permit plaintiffs in a case involving significant damage claims to avoid consideration of whether a class action would be a manageable way to resolve the case.”  Citing Adams v. R.R. Donnelley & Sons, 2001 WL 336830 at *16 (N.D. Ill. 2001).

The court distinguished this case from one where individual issues were limited to damages.  In such a case, “there likely would be a proper way to structure a trial or trials with a minimum of inefficiency without doing violence to the parties’ Seventh Amendment rights.”

Here, however, the court concluded that there were “several separate layers of individual issues, including the variation in personnel practices among the various branch offices, and how various office managers and complex managers handle individualized personnel decisions. These extra layers of individualized issues lead the court to conclude that common issues do not predominate over individual issues, and that trial of the claims as a class action would be unmanageable.”  Accordingly, the court denied plaintiffs’ motion for class certification is denied.

Defendants were represented by Jared R. Friedman of Weil, Gotshal & Manges LLP,

Jeffrey Scott Piell of Lupel Weininger LLP and Stephen Michael Shapiro and Timothy Simon Bishop of Mayer Brown LLP.

By CHARLES H. JUNG