Betty Luu – Class Action Defense

By Gerald L. Maatman, Jr., Jennifer A. Riley, Betty Luu, and Ryan T. Garippo

Duane Morris Takeaways: On April 22, 2026, in Ayers, v. GKN Driveline North America, Inc., No. 23-CV-00581, 2026 U.S. Dist. LEXIS 89819 (M.D.N.C. Apr. 22, 2026), Chief Judge Catherine Eagles of the U.S. District Court for the Middle District of North Carolina denied several motions to certify various claims as class and collective actions under the Fair Labor Standards Act (the “FLSA”) and the North Carolina Wage And Hour Act (the “NCWHA”). This decision underscores the responsibility of plaintiffs’ counsel to manage a case and present the court with a viable plan to bring their clients’ claims through trial. Otherwise, plaintiffs’ counsel runs the risk that the court will not certify these claims at all.

Case Background

This decision emerges in the context of a series of seven-year-long lawsuits against GKN Driveline North America, Inc. (“GKN”), the supplier of all-wheel-drive and other automotive components, for several major automotive manufactures. Plaintiffs James Ayers, John Carson, and Tameka Ferges (collectively, “Plaintiffs”) brought three separate wage-and-hour lawsuits, asserting claims under the FLSA and the NCWHA. Plaintiffs alleged that GKN required them to perform work off the clock, including before and after shifts, and during unpaid meal breaks.

In 2018, Plaintiffs filed an earlier case against GKN. In that case, Plaintiffs alleged GKN had two policies that resulted in underpayment of their wages: (1) a “time rounding” policy; and (2) an “automatic deduction” policy for meal breaks. The Court originally conditionally certified an FLSA collective action and a Rule 23 class action under both of those theories. But the court ultimately decertified both the FLSA collective and the Rule 23 class, finding that “individual issues would swamp any attempt to resolve the claims on the class or collective basis.” Id. at *5

After that decision, Plaintiffs – represented by the same counsel – refiled three similar lawsuits, which split the claims based on GKN’s plant locations, but otherwise left the theories mostly intact. Plaintiffs then filed renewed motions for class and collective certification in each of the three actions and again asked the Court to allow them to proceed on a representative basis. The Court’s opinion, for all three cases, followed.

The Court’s Decision

In her 28-page opinion, Chief Judge Eagles of the U.S. District Court for the Middle District of North Carolina denied Plaintiffs’ motions based largely on manageability grounds.

Chief Judge Eagles explained that “manageability principles are explicit in the requirements for a proposed Rule 23(b)(3) class” and that “wider case management concerns remain relevant in the collective context.” Id. at 13. Thus, it is generally a plaintiff’s attorney’s responsibility to present the court with an “organized presentation of claims, organized discovery and motions practice, and organized submission of evidence.” Id. But here, Plaintiff’s counsel failed to present a manageable class or collective in at least four different ways.

First, and perhaps most fundamentally, Chief Judge Eagles found that “plaintiffs propose no efficient method of resolving class-wide liability and individual damages across three different subclasses.” Id. at *18. Although Plaintiffs’ theory was premised on the notion that GKN had a “de facto off-the-clock” policy, Plaintiffs did not explain how they planned to “efficiently prove that each and every nonexempt employee was subject to that de facto policy and, even more crucially, how each class member was injured by this policy.” Id. at *18-19. Chief Judge Eagles found this omission troubling given that “plaintiffs have had years to think about these problems” and could not present the court with a manageable solution. Id. at *19. But Chief Judge Eagles did not stop there.

Second, having dispensed with the omissions in Plaintiffs’ theory of case manageability, Chief Judge Eagles turned to Plaintiffs’ counsel who she reasoned has “not demonstrated the organization, diligence, and mindset required to prosecute a complex case.” Id. at *21. Chief Judge Eagles explained that because she often had to prompt Plaintiffs’ counsel to prosecute the case, via supplemental briefing and discovery, she had lost confidence in their ability to manage the docket. This problem was compounded by Plaintiffs’ counsel’s filing of “several ‘emergency’ motions and amended ‘emergency motions’” which underscored their inability to “handle ordinary litigation problems.” Id. at *21-22.

Third, Chief Judge Eagles characterized Plaintiffs’ counsel’s Rule 23 analysis as the product of an unreliable “narrator of the record.” Id. at *22-23. She described Plaintiffs’ counsel’s submissions as “inaccurate at best and misrepresentations at worst.” Id. at *23. Similarly, for the FLSA claims, Chief Judge Eagles held that the “factual representations about the evidence in the plaintiffs’ briefing on an FLSA collective do not always hold up to scrutiny.” Id. at *31-32. These inaccuracies did not give her confidence that Plaintiffs’ counsel would be able to present a manageable case through trial.

Fourth, as to the FLSA claims, Chief Judge Eagles concluded by finding that “the plaintiffs have not proposed any plan, much less a workable plan, for the aggregation of all these claims.” Id. at *31. For example, Chief Judge Eagles highlighted that plaintiffs “have not explained how they will manage presenting evidence on all the different work activities at issue and [across] three different plants.” Id. She noted that – although it is often possible for plaintiffs’ counsel to create such theories — “[i]f they are unable to make the required showing after over seven years of litigation, there is no reason to think they will be able to do so by the time these cases are called for trial.” Id. at *33.

In short, Chief Judge Eagles explained that she “has certified several dozen class actions over the past fifteen years and is familiar with how to deal with disagreements between parties about managing and trying common and individual issues.” Id. at *26. “The problem here is not that management might be hard” but rather “that the plaintiffs proffer no plan for management . . . [a]nd the Court has no confidence that counsel will devise a workable plan.” Id. Thus, the motions were denied in their entirety.

Implications For Employers

Ayers presents two key lessons for corporate counsel grappling with how to manage these complex cases.

The first lesson is that the value of class and collective claims often can hinge on the identity and competency of opposing counsel. Where plaintiffs’ counsel is savvy, competent, and organized, the value of otherwise weaker claims can go up. In these cases, competent plaintiffs’ counsel can often be the difference in whether a class is certified, which is often the difference between millions of dollars of potential of exposure and not. Thus, corporate counsel should weigh the competency of his or her adversaries when assessing the risk that a putative class or collective action poses.

The second lesson is that hiring experienced defense counsel and developing an aggressive litigation strategy are critical for success in such cases. In Ayers, Chief Judge Eagles observed defense counsel’s strategy and explained “it has been clear for years that GKN intended to hold the plaintiffs to their burden of proof at every stage on every issue, as is their right.” Id. at *22, n.13. As a result, any delay by GKN ultimately did not negate the deficiencies by Plaintiffs’ counsel. It takes experienced counsel to toe this line and keep the focus on a plaintiff’s conduct. Corporate counsel should consider such experience when deciding who is best to represent their organizations.

By Gerald L. Maatman, Jr., Rebecca S. Bjork, and Betty Luu

Duane Morris Takeaways: On July 1, 2025, the U.S. Court of Appeals for the Ninth Circuit issued a decision in a case with major ramifications for employers facing wage and hour claims under the Fair Labor Standards Act. In Harrington v. Cracker Barrel Old Country Store, Inc., Nos. 23-15650, 24-1979 (9th Cir. July 1, 2025), a unanimous panel joined three other Circuits and held that the U.S. Supreme Court’s Decision in Bristol-Myers Squibb Co. v. Superior Court of Cal., 582 U.S. 255 (2017), applies to actions under the FLSA brought in federal court. This means that to achieve nationwide issuance of notice of a collective action under Section 216(b), each opt-in plaintiff must show a sufficient connection to the forum state. The impact will likely be fewer nationwide collective actions, which ultimately may reduce litigation pressure on employers who operate in states within the Ninth Circuit.

Background

Plaintiffs, former and current employes of Cracker Barrel, filed a class action lawsuit in the U.S. District Court for the District of Arizona against Cracker Barrel alleging violations of the Fair Labor and Standards Act (“FLSA”). Id. at 7. Plaintiffs moved for court authorization to send notice of a collective action under the FLSA to “all servers who worked for Cracker Barrel in states where it attempts to take a tip credit . . . over the last three years.” Id. at 7. Cracker Barrel objected on various grounds, including that the district court did not have personal jurisdiction over any of its employees outside of Arizona. Id. at 7. The district court granted the plaintiffs’ motion and ordered the issuance of nationwide notice because “the participation of one Arizona-based plaintiff was all that was needed to secure personal jurisdiction over Cracker Barrel for the collective action.” Id. at 7. Cracker Barrel appealed the district court’s decision to the Ninth Circuit.

The Ninth Circuit Joins The Third, Sixth and Eighth In Requiring Non-Resident Plaintiffs In FLSA Collective Actions To Establish Specific Personal Jurisdiction

The three-judge panel in Harrington unanimously held that where the basis for personal jurisdiction in an FLSA collective action is specific personal jurisdiction, the district court must assess whether each opt-in plaintiff’s claim bears a sufficient connection to the defendant’s activities in the forum state. In the case before them, they concluded that the district court authorized nationwide notice on the mistaken assumption that it would not need to assess specific personal jurisdiction on a claim-by-claim basis. As a result, it vacated and remanded for further proceedings.

In so doing, the Ninth Circuit held that the Supreme Court’s requirement outlined in Bristol-Myers — that non-resident plaintiffs in a mass tort action must establish their own basis for personal jurisdiction — applies in FLSA collective actions.

It therefore adopted the view of three other Circuits (the Third, Sixth, and Eighth) that non-resident plaintiffs must establish their own basis for specific personal jurisdiction in the context of an FLSA collective action. Thus, within the Ninth Circuit, a district court now must determine whether each opt-in plaintiff’s claim bears a sufficient connection to the defendant’s activities in the forum state.

Implications Of The Decision

Harrington v. Cracker Barrel means that in states encompassed within the Ninth Circuit, employers facing wage and hour collective actions will be far less likely to need to worry about the possibility of multi-state or nationwide issuance of notice under Section 216(b) of the FLSA.

This decision has enormously important implications for such employers. If nothing else, the vast geographic territory and population encompassed by the jurisdiction of the Ninth Circuit means that employers now have a powerful pre-certification defense argument to deploy to defend against putative nationwide collective actions, which tend to arise where large populations of potential opt-in plaintiffs are employed. We will follow the case on remand and keep our blog readers apprised as to how plaintiffs’ counsel proceeds in the district court.