Category: Class Action Weekly Wire

Duane Morris Takeaway: This week’s episode features Duane Morris partners Jerry Maatman and Jennifer Riley with their analysis of class certification data in the first six months of 2026 and their prognostications for trends shaping the remainder of the year.

Read our full mid-year settlement review here and class certification data here.

Check out today’s episode and subscribe to our show from your preferred podcast platform: Spotify, Amazon Music, Apple Podcasts, Podcast Index, Tune In, Listen Notes, iHeartRadio, Deezer, and YouTube.

Episode Transcript

Jerry Maatman: Hello, everyone, and welcome to the next episode of the Class Action Weekly Wire. I’m Jerry Maatman, and with me today for a special mid-year review of class certification numbers is Jen Riley. Jen, welcome back to the show.

Jennifer Riley: Thanks, Jerry, it’s great to be here, especially with so much going on in the class action space this year.

Jerry: Well, here we are, halfway through 2026. Let’s start with the big picture. Courts ruled on more than 155 class certification motions in just the first half of the year, and plaintiffs were successful in 63% of those situations. That’s quite a difference from the year before, isn’t it?

Jennifer: It is. Last year, the success rate was 68%, so we’re seeing a notable downtick. An even bigger change that we saw in 2024, 2023, and 2022, when certification success rates hit 69%, 72%, and 74%, respectively. So, the trajectory so far this year suggests that plaintiffs might not be as successful as they have been in the past.

Jerry: Seems to me what’s interesting, behind the numbers is the downturn isn’t across the board, it really depends on the subject matter area at issue in the class action.

Jennifer: Exactly. So, certification rates are all over the place. FCRA, TCPA, RICO, and WARN class certification decisions have all been small in number, with only one or two rulings in each of those areas, but all of them have been granted. So, 80% of class certification motions and securities fraud cases have been granted. Then on the flip side, less than half of certification motions and privacy were granted, and the one ruling on a class certification and products liability was denied.

Jerry: That really does run the gamut, and its very statute-oriented or subject matter oriented. Let’s talk about wage and hour or Fair Labor Standards Act conditional certification. Does that continue to be the most active area litigation in this space?

Jennifer: It does. From January through June, courts issued 69 rulings in FLSA matters. 67 of those were first stage motions for conditional certification, and plaintiffs won 39. So, that’s a success rate of only 58%, which is way down from the 76% in 2025 and the 79% we saw in 2024.

Jerry: When I look at those numbers and look at the locations, it’s striking how those rulings are congregated in certain geographic areas. A large chunk came from the Second and Ninth Circuits – places like New York City and San Francisco and Los Angeles, which tend to be more favorable to the plaintiffs’ bar.

Jennifer: That’s absolutely right. And at the decertification stage, the usual trend where defendants succeed more often hasn’t really been playing out this year. We’ve seen only two decertification rulings so far, and plaintiffs won one of those. So, it’s 50-50 so far this year.

Jerry: One of the key takeaways for me from this mid-year data analytics analysis is how much locations impact where cases get filed. We’re seeing very few rulings, for instance, from the Fifth, Sixth, and Seventh Circuits: only five in total. Any thoughts on why this is going on?

Jennifer: Great question. So, I think it’s likely a strategic move by the plaintiffs. Those circuits have adopted stricter standards for conditional certification, really making them less appealing venues. So, plaintiffs may be shifting, shifting their filings toward more lenient circuits to give them a better chance of success.

Jerry: If more circuits would follow the lead of the Fifth, Sixth, and Seventh Circuits, and start abandoning the traditional two-step certification process established in the Lusardi case out of New Jersey in 1987, that could have a big impact on where cases are brought and how they’re treated by the courts.

Jennifer: Absolutely. The mid-year numbers show us that venue selection, subject matter, and timing are all very critical in class action strategy. And with the FLSA continuing to dominate, we’ll be watching closely to see how courts respond in the second half of the year.

Jerry: Well, we’ll have the final data and full analysis in the Duane Morris Class Action Review for 2027 coming out in the first week of January of next year, so stay tuned. We’ll be back with more insights then. Jen, thanks as always for being here and for giving us your analysis of these trends on class certification.

Jennifer: Thank you, Jerry, and thanks to our listeners for tuning in.

Duane Morris Takeaway: This week’s episode features Duane Morris partners Jerry Maatman and Jennifer Riley with their analysis of class action settlement data in the first six months of 2026 and their prognostications for trends shaping the remainder of the year.

Read the full mid-year settlement review in our previous blog post.

Check out today’s episode and subscribe to our show from your preferred podcast platform: Spotify, Amazon Music, Apple Podcasts, Podcast Index, Tune In, Listen Notes, iHeartRadio, Deezer, and YouTube.

Episode Transcript

Jerry Maatman: Hello, everyone, and welcome to the next episode of the Class Action Weekly Wire. I’m Jerry Maatman, and with me today for the special mid-year review of class action settlements is Jen Riley. Jen, welcome back. Here we are halfway through 2026. What’s the big picture look like in the class action settlement space?

Jennifer Riley: Thanks, Jerry. Well, it’s been quite a ride. The data confirms essentially what we’ve been tracking since 2022. We are in a new era for class action litigation. Corporate defendants have been facing unprecedented settlement exposures. The total value of class action in government enforcement settlements hit $79 billion in 2025 that follows $66 billion in 2022, $51.4 billion in 2023, and $42 billion in 2024. As of mid-2026, we have already reached over $53 billion.

Jerry: That’s an enormous number. So, what we’re talking about is over $200 billion in just the last few years.

Jennifer: That’s exactly right. It is the largest multi-year span of settlements in U.S. legal history, and if current trends hold up, 2027 may end up ahead of the prior four years.

Jerry: Where are we seeing the biggest dollar amounts generated in these class action settlements?

Jennifer: Well, antitrust has historically had high settlements, and it is leading the charge this year with over $34 billion in settlements. Products liability and mass torts also have had big settlements this year, and has been no different in that area either, with almost $9 billion so far. Securities fraud settlements are also on track with last year’s numbers, and they’ve reached almost $2 billion so far.

Jerry: I know you track this space on a daily basis, 24-7. Any standout billion-dollar settlement cases come to mind?

Jennifer: So, there have been a few major ones. I would say the In Re College Athlete NIL Litigation is a big one. That one hit $2.78 billion alone. It finally gave athletes retroactive compensation for missed name, image, and likeness opportunities. So, that’s a historic shift in the landscape there. Also, worth noting that Purdue Pharma’s $7.4 billion opioid-related settlement. Just last week, Purdue announced that it is preparing to send an updated bankruptcy plan and proposed settlement to a vote following broad sign-on by all U.S. states and territories.

Jerry: These seem to be landmark figures. Are we seeing any high numbers of billion-dollar cases in and of themselves?

Jennifer: We are. So, there have been three billion-dollar settlements so far in 2026. That brings us to 45 total settlements over a billion dollars since 2022. That is the most in any four-and-a-half-year period ever.

Jerry: By your examination and analysis, are there any particular industries or sectors that are showing either surprising or emerging exposures in this area?

Jennifer: Great question. Data breach and privacy settlements have become increasingly prominent. Apple agreed to a $250 million settlement in a class action to resolve claims alleging that it misled millions of iPhone buyers by falsely touting AI capabilities for its Siri Voice Assistant 2024. Also, government enforcement settlements are on the rise. One of the billion-dollar settlements so far this year is an agreement with the New Jersey Department of Environmental Protection and EI DuPont to resolve the state’s claims over contamination caused by the manufacture and discharge of forever chemicals.

Jerry: Let’s talk antitrust. You referred to that before. What’s the headline here?

Jennifer: So, the antitrust sector is very active, with notable cases against the NCAA, as I mentioned earlier, as well as Visa, MasterCard, and RealPage. There is a sustained focus on wage suppression and market manipulation. Those have been key areas of concern for regulators, as well as for plaintiffs.

Jerry: Are you seeing the same sort of similar energy from the Planum sparred compared to past years?

Jennifer: Absolutely. In fact, the size and pace of these settlements suggests that plaintiffs’ attorneys are pushing harder than ever, likely encouraged by that sheer size of recent wins.

Jerry: When you look at the trends and the data analytics, do you see any areas that are cooling off in 2026?

Jennifer: Great question. So, civil rights settlements have been fairly low this year. We’re also seeing some slowdown in TCPA-related cases, although final settlement approval for $28 million was granted in a case against SiriusXM Radio to resolve claims alleging that it made telephone calls to people on the Do Not Call Registry, or Sirius’ internal Do Not Call Registry. But overall, most sectors are either holding steady or are growing.

Jerry: Any closing thoughts to what should be uppermost on the mind of corporate counsel in this area?

Jennifer: Yeah, so I would say the bottom line is that corporate defendants are operating in a legal environment where large-scale class actions, whether driven by consumers, employees, investors, or regulars, are pretty much a constant and a very costly risk. We’re in a high-stakes phase of class action litigation, and there’s really no indication that it’s slowing down or going to slow down in the foreseeable future.

Jerry: Well, Jen, thanks as always for your insights, and thanks to our listeners for tuning in. We will be sure to keep you updated with new developments on these settlement numbers. It sounds like for the upcoming Duane Morris Class Action Review – 2027 edition, is going to be a must-read.

Jennifer: I think it definitely will be. Thanks, Jerry, and thank you to our listeners.

Duane Morris Takeaway: This week’s episode features Duane Morris partner Jerry Maatman and associates Christian Palacios and Andrew Quay with their discussion of key ruling issued by the Ninth Circuit reversing a California federal judge’s order denying a motion to compel arbitration.

Check out today’s episode and subscribe to our show from your preferred podcast platform: Spotify, Amazon Music, Apple Podcasts, Podcast Index, Tune In, Listen Notes, iHeartRadio, Deezer, and YouTube.

Episode Transcript

Jerry Maatman: Hello, everyone, and thank you for being here again for the next episode of the Class Action Weekly Wire. I’m Jerry Maatman, a partner at Duane Morris, and joining me today are my colleagues, Christian and Andrew. Thank you both for being on our podcast.

Christian Palacios: Glad to be here, Jerry.

Andrew Quay: Thanks for having me, Jerry.

Jerry: Today, we’ll be discussing a very significant ruling by the Ninth Circuit that California employers, and really any employer using arbitration agreements, should be paying attention to. It’s the case of Cocom v. ABM Aviation. Christian, let’s start with the basics. What happened in this case?

Christian: So, this case involved a former airport janitor who filed a California wage and hour class action against his employer, ABM Aviation. Like many employers, ABM required employees to sign an arbitration agreement at the beginning of their employment. When the lawsuit was filed, ABM moved to compel arbitration. The district court denied the motion, finding the arbitration agreement procedurally and substantively unconscionable under California law, relying heavily on a 2024 California Court of Appeals decision called Cook v. University of Southern California. ABM appealed, and the Ninth Circuit reversed.

Jerry: So, this wasn’t about whether the arbitration agreement itself is enforceable under the Federal Arbitration Act. The question here was whether this particular agreement was so unfair under California law, that it couldn’t be enforced. Andrew, why did the district court think the agreement was unconscionable and therefore unenforceable?

Andrew: That’s right, Jerry. The district court focused on several provisions. First, it believed the agreement covered essentially every conceivable dispute between the employee and the company, and not just employment claims. Second, because it interpreted the agreement that broadly, it concluded the agreement lasted indefinitely. Third, it thought the agreement unfairly favored the employer because numerous affiliated entities and employees could invoke arbitration against the employee, while the employee supposedly had fewer reciprocal rights. Finally, the court concluded the agreement improperly waived certain forms of public injunctive relief; and looking at all those provisions together, the district court found the agreement was permeated with illegality and declined to even sever the problematic parts of it.

Jerry: Christian, the Ninth Circuit saw things differently. What was the outcome there?

Christian: It really did see things differently. The central issue was one of contract interpretation. The district court essentially read the phrase, including but not limited to, as making the arbitration agreement unlimited in scope. The Ninth Circuit disagreed, saying that’s not how California contract interpretation works. Instead, the Ninth Circuit applied the doctrine of Ejusdem generis, a long-standing principle that says when general language is followed by a list of specific examples, the general language is interpreted in light of those examples. Here, every specific example in the arbitration agreement involved employment-related disputes, wage claims, discrimination, retaliation, wrongful termination, labor code claims, and similar employment issues. Because of that, the court held the agreement should be interpreted as covering employment disputes, not unrelated personal disputes years after the employment ended.

Jerry: Andrew, that sure seems like a pretty important distinction from Cook. Could you explain that for our listeners?

Andrew: Probably the biggest takeaway here. So, in Cook, the arbitration agreement expressly stated that covered claims, “whether or not arising out of employment.” It also specifically listed non-employment tort claims. So, the California Court of Appeals imagines scenarios like a former employee needing to arbitrate a medical malpractice claim at a university hospital or a defamation claim years after employment ended. The Ninth Circuit said that’s simply not what ABM’s agreement did. ABM’s agreement focused exclusively on employment-related claims, and that distinction changed almost every aspect of the unconscionability analysis.

Jerry: It also addressed durational issues, too, didn’t it?

Christian: That’s right. Once the court concluded the agreement only applied to employment-related claims, the duration issue largely disappeared. Employment claims naturally stop accruing when employment ends, and applicable statutes of limitations eventually cut off any remaining claims. So, unlike the agreement in Cook, this agreement wasn’t truly perpetual.

Jerry: What about the concept of mutuality? That’s a concept employers hear about frequently in this space.

Andrew: Mutuality basically asks whether both sides are giving up similar rights. The employee argued that affiliates, officers, directors, employees, vendors, and clients could enforce the arbitration agreement against him, but he couldn’t as easily enforce it against them. Again, the Ninth Circuit said context matters here. Because the agreement only covered employment-related disputes, any claim involving those third parties would still have to arise out of the employment relationship. The Ninth Circuit explained that this is very different from forcing employees to arbitrate completely unrelated personal disputes with company affiliates years later.

Jerry: The Ninth Curcuit opinion also discusses PAGA waivers and the concept of public injunctive relief. What did the court do there?

Christian: Interestingly, the Ninth Circuit didn’t actually decide whether those provisions were enforceable. Instead, it assumed that even if those provisions were invalid under California law, they could simply be severed because of the agreement’s severability clause. That represents a fairly employer-friendly approach because courts sometimes refuse to enforce arbitration agreements if they believe illegal provisions infect the entire contract. Here, the Ninth Circuit concluded that wasn’t the case.

Jerry: Let’s turn to the practical side of this Ninth Circuit decision. If you’re advising employers in the wake of Cocom, what lessons should they take away from this ruling?

Andrew: The biggest lesson here is careful drafting. Employers should avoid language suggesting that arbitration extends to every conceivable dispute between the parties. The safest approach is to expressly limit covered claims to those arising out of employment or the employment relationship. That helps avoid the problems that doomed the agreements in Cook and similar California cases.

Christian: I’d add that employers should also revisit older arbitration agreements. Many agreements drafted years ago contain broad, any and all claims language that may have seemed harmless at the time but now creates litigation risk under California’s unconscionability doctrine. It’s worth reviewing those agreements to make sure the scope is appropriately limited and definitely include a well-written severability clause.

Jerry: Well, great insights from both of you, Andrew and Christian. The ABM decision by the Ninth Circuit is a great reminder to companies to review their arbitration agreements to ensure that they’re clearly limited to employment-related disputes and to update agreements to reflect evolving notions of California law, rather than relying upon forms drafted years ago. So, thanks so much for being here today with us, Christian and Andrew, and thank you to our listeners for tuning in.

Andrew: Thanks for having me, Jerry, and thank you, listeners.

Christian: Thanks, everyone, for listening.

Duane Morris Takeaway: This week’s episode features Duane Morris partner Jerry Maatman, special counsel Adam Brown, and associate Elizabeth Underwood with their discussion of key ruling issued in the ongoing Mobley v. Workday litigation challenging the use of AI tools in employment practices.

Check out today’s episode and subscribe to our show from your preferred podcast platform: Spotify, Amazon Music, Apple Podcasts, Podcast Index, Tune In, Listen Notes, iHeartRadio, Deezer, and YouTube.

Episode Transcript

Jerry Maatman: Hello, everyone, and thank you for being here again on the next episode of the Class Action Weekly Wire. I’m Jerry Maatman, a partner at Duane Morris, and joining me today are my colleagues, Adam Brown and Elizabeth Underwood. Thanks so much for being on the podcast today.

Elizabeth Underwood: Glad to be here, Jerry.

Adam Brown: Thanks for having me, Jerry.

Jerry: Today, we’re discussing a significant decision in a rapidly evolving area of artificial intelligence and employment law. The case is Mobley v. Workday, and it involves a June 2026 decision from the Northern District of California. The plaintiffs in this lawsuit allege that Workday’s AI-driven applicant screening tools disproportionately screen out applicants based on race, age, disability, and other protected categories. While this isn’t a final ruling on the merits, the court’s decision on Workday’s motion to dismiss contains several important takeaways for employers, especially those using artificial intelligence in recruiting and hiring. With that background, Adam, can you start by giving our listeners a quick overview of the case?

Adam: Absolutely, Jerry. The plaintiffs in this case are a group of job applicants who allege that they applied for positions through employers. They used Workday’s applicant screening platform. According to the complaint, Workday’s AI and machine learning tools evaluated, ranked, and in some cases automatically rejected applicants. The plaintiffs claimed those tools had a disparate impact on protected groups, including older workers, individuals with disabilities, and certain racial groups. This latest ruling focused primarily on procedural issues. Workday asked the court to dismiss portions of the third amended complaint, arguing that the plaintiff still hadn’t adequately connected their claims to California, and that several new allegations exceeded the scope of what the Court previously allowed them to amend. The court granted some portions of Workday’s motion but denied most of it.

Jerry: Well, there are rulings, there are cases, and then there are cases, and I would say this is one of the most closely watched employment discrimination class action cases in the United States. Elizabeth, what do you see as the important takeaways from the ruling?

Elizabeth: The biggest takeaway is that the court allowed the plaintiffs’ California Fair Employment and Housing Act, or FEHA, claims to proceed. That’s significant because many of the plaintiffs are not California residents and applied for jobs located outside California. Workday argued that California employment law shouldn’t apply to those circumstances. The company essentially said there wasn’t a sufficient nexus between the alleged discrimination and California. The court disagreed.

Jerry: Adam, why would the court disagree with respect to that, what many would call an extraterritorial, type of argument?

Adam: Well, the plaintiffs had revised their complaint to allege that Workday’s AI screening systems were designed, developed, maintained, trained, and operated from Workday’s California headquarters. The court stated that the plaintiffs weren’t simply alleging that Workday happened to be headquartered in California. Instead, they alleged that the actual screening, scoring, and rejection decisions generated by the AI tools originated from California-based operations. At the pleading stage, the court found those allegations sufficient. What’s particularly notable is that the court viewed Workday as potentially being directly responsible for discriminatory conduct, rather than merely acting as a passive software vendor.

Jerry: That seems like a very major point of the decision. What did the court say about Workday’s role here?

Elizabeth: So, Workday argued that if an employer customer wouldn’t be liable under FEHA, then Workday shouldn’t be liable either. The court rejected that argument and explained that under California law, an entity acting as an employer’s agent can be directly liable for its own discriminatory conduct when performing employment-related functions on behalf of employers. In other words, the court treated Workday not merely as a software provider, but as a company that allegedly participated in employment decision-making through its screening technology. That distinction could have implications well beyond this case.

Jerry: Let’s talk about the practical implications of a ruling like that. What are the takeaways that employers should note from this ruling?

Adam: There are a couple of important takeaways from this. First, employers should recognize that courts are increasingly willing to scrutinize AI tools used in hiring. Historically, employers might have viewed applicant screening software as a neutral technology solution, but courts are now looking much more closely at whether those systems could create disparate impact on protected groups. Second, employers cannot assume that liability concerns end with the vendor. Even though Workday is the defendant here, the allegations highlight the risks associated with relying on automated screening tools without understanding how they function or whether they create adverse impacts.

Jerry: Elizabeth, to me, another important and interesting aspect of the decision involved its discussion of disability discrimination. Could you give our listeners some insights on that?

Elizabeth: Sure, so one plaintiff alleged discrimination based on physical disabilities, specifically asthma and cancer survivorship. The complaint alleged that AI hiring tools may identify proxy indicators associated with health conditions, things like employment gaps, medical leave history, or patterns that suggest treatment and recovery. The plaintiffs contended that the algorithm can infer disability-related characteristics from those proxies, even when disability information isn’t directly provided. Importantly, Workday did not challenge the sufficiency of those allegations in this motion. Instead, it argued that the plaintiff wasn’t permitted to add those theories. The court rejected that procedural argument and allowed the disability claim to proceed. For employers, that’s another reminder that AI systems can potentially create risk, even when they don’t explicitly ask about protected characteristics.

Jerry: Well, bottom line is, the court didn’t deny the motion in its entirety. What claims, indeed, were thrown out?

Adam: Yeah, that’s correct. One of the plaintiffs attempted to add a new race-based disparate impact claim that was focused on alleged discrimination against Asian American applicants, but the court found that theory had not been properly asserted in earlier versions of the complaint, and so it exceeded the scope of the amendment the Court had authorized, and as a result, that claim was dismissed.

Adam: The court also just struck allegations suggesting that Workday should be liable as an employer based on its own hiring practices. Concluding that that theory had not previously been pleaded and wasn’t authorized by the amendment order. So, while the plaintiffs won most of the major issues, Workday did succeed in narrowing the case in several respects.

Jerry: Well, as we wrap up this episode of the Class Action Weekly Wire, what are some of the broader lessons you think employers should take, both from this case and from this ruling?

Adam: I see at least three major lessons. First, AI governance is becoming a core employment law issue. Second, employers need visibility into how automated screening systems operate. Including what data they use, how candidates are ranked, and whether outcomes are regularly audited for disparate impact. Third, contractual protections with vendors are becoming increasingly important. Employers should review representations, warranties, indemnification provisions, audit rights, and compliance obligations relating to AI-enabled employment tools.

Elizabeth: I would add one more point. This decision reflects a growing judicial willingness to treat AI-driven employment decisions as employment practices subject to traditional discrimination laws. The technology may be new, but courts are applying familiar legal principles, including disparate impact, agency liability, and anti-discrimination statutes to evaluate these systems. Employers should expect continued scrutiny from courts, regulators, and plaintiffs’ attorneys in this area.

Jerry: Well, great insights from both of you, Elizabeth and Adam. The Mobley vs. Workday case is certainly another reminder that while artificial intelligence may streamline recruiting and employment-related decisions. It certainly doesn’t eliminate legal risk. In some respects, it may create new legal risks that employers need to manage and mitigate. So, we’ll continue monitoring developments in this case and the broader landscape of AI-related employment litigation in the class action space. Well, thanks so much for being with me today, Adam and Elizabeth, and thanks to our listeners for tuning in.

Adam: Thank you, Jerry, for having me.

Elizabeth: Thanks, everyone, have a great week.

Duane Morris Takeaway: This week’s episode features Duane Morris partner Jerry Maatman and special counsel Eden Anderson and Rebecca Bjork with their discussion of significant arbitration developments in class actions.

Check out today’s episode and subscribe to our show from your preferred podcast platform: Spotify, Amazon Music, Apple Podcasts, Podcast Index, Tune In, Listen Notes, iHeartRadio, Deezer, and YouTube.

Episode Transcript

Jerry Maatman: Thank you, loyal blog readers and podcast listeners for joining us for our next episode of our weekly series and podcast called The Class Action Weekly Wire. I’m Jerry Maatman of Duane Morris, and joining me today are my colleagues, Eden Anderson and Rebecca Bjork. Thank you so much for being here today on the podcast.

Eden Anderson: Great to be here, Jerry.

Rebecca Bjork: Thanks for having me, Jerry.

Jerry: Today, we wanted to discuss and explore trends and important rulings in the area of arbitration and class action litigation. Arbitration has been one of the areas where each year seems to bring new rulings and new gloss to the Federal Arbitration Act. We saw significant Supreme Court decisions this past year, and California courts also continue to reshape the relationship between arbitration and representative actions brought under the PAGA. Eden, when you look at the last 18 months, what stands out to you?

Eden: Yeah, Jerry, two things stand out. First, the Supreme Court continues to refine the scope of the Federal Arbitration Act’s transportation worker exemption. And second, California courts are still trying to answer some fundamental questions about how arbitration affects representative PAGA claims.

Jerry: Let’s start with the U.S. Supreme Court. The biggest arbitration decision so far this year is probably Flowers Foods vs. Brock. Rebecca, what was that case all about?

Rebecca: That case involved delivery drivers who distributed bakery products for a company named Flowers Foods, and the drivers argued that they fell within the transportation worker exemption in Section 1 of the Federal Arbitration Act and therefore could not be compelled to arbitrate under that act. The company argued that the drivers were making local deliveries only, and were not the kind of interstate transportation workers Congress had in mind when it created that exemption.

Jerry: And how did the Supreme Court come out on that question?

Rebecca: Oh, the Supreme Court disagreed. The court focused on the role that the workers played in the movement of goods through interstate commerce, and the key takeaway is that a worker doesn’t necessarily have to cross state lines personally to qualify for the exemption. If the worker is participating in a continuous interstate flow of goods, the exemption may apply even when the worker’s own deliveries occur entirely within one state.

Eden: And that is what makes the decision important. A lot of businesses have assumed that local delivery drivers were safely within the FAA’s scope. Flowers Foods suggests the analysis is more nuanced than that. Employers with delivery networks, logistic operations, warehouse-to-consumer distribution systems, or similar models should be evaluating whether portions of their workforce might now fit within the transportation worker exemption.

Rebecca: And what’s interesting is that this case, Flowers Foods isn’t really an outlier. It’s part of a broader trend at the Supreme Court. Over the last several years, the court has repeatedly focused on the actual work being performed, rather than formal job titles or industry labels, and Flowers Foods continues that trajectory.

Jerry: So, if that’s the federal story at the Supreme Court level, what about California in terms of the state law story and the significant litigation that occurs within the Golden State?

Eden: Well, as our listeners know, under the U.S. Supreme Court’s decision in Viking River, out in California, individual PAGA claims can be separated from a PAGA action and compelled to arbitration. But after Viking River, plaintiffs here began trying to disclaim their individual PAGA claims, trying to avoid arbitration. And courts out here have been grappling with whether that’s a permissible tactic and whether if an individual PAGA claim is found to be meritless or non-viable, whether the plaintiff can still pursue representative PAGA claims on behalf of other employees.

Jerry: One of the most significant cases from California in 2025 surely is the CRST Expedited v. Superior Court case, where the employee voluntarily dismissed the individual PAGA claim and sought to continue litigating only in a representative capacity. The employer argued that once the individual claim was gone, the representative claim also had to go as well, but the Court of Appeal disagreed.

Eden: That’s right, Jerry. Faced with supposed ambiguity in the statute, the Court of Appeal interpreted PAGA very broadly, and concluded that plaintiffs can abandon their individual PAGA claims, sidestep arbitration altogether, and pursue only representative PAGA claims in court.

Jerry: So, the bottom line is the CRST decision effectively gave support to the notion that a plaintiff’s lawyer can litigate a headless PAGA theory successfully in court.

Rebecca: It was a significant victory for the plaintiffs’ bar, yes, because it suggested that representative claims might survive even after an individual claim is dismissed.

Rebecca: But that’s actually not the end of the story, because just two days later, another California appellate court reached the opposite conclusion. And that case was Williams v. Alacrity Solutions Group, and the court held that a plaintiff needed a viable and timely individual claim in order to pursue representative PAGA penalties. And because the plaintiff’s own claim was time-barred, that court concluded he could not proceed with the representative action.

Eden: Yeah, and we saw a similar approach in Leeper vs. Shipt. The plaintiff there also tried to avoid arbitration by disclaiming individual relief, and the Court of Appeal there held that all PAGA actions necessarily must include an individual claim. In the court’s view, you can’t simply disclaim an individual PAGA claim and proceed only in court on behalf of others: your individual PAGA claim has to be asserted and is subject to arbitration.

Jerry: Well, it sure seems like these issues and principles are on a collision course for the California Supreme Court at this point.

Rebecca: That’s exactly right, and that’s why the California Supreme Court’s upcoming review is so important. The Court has agreed to address two fundamental questions: first, does every PAGA action necessarily contain both an individual and a representative component? And second, can a plaintiff choose to pursue only the representative portion of a PAGA claim?

Jerry: Well, these sound like technical parsings of the statute, but my sense is there are enormous practical consequences that can stem from the outcome of this question.

Eden: That’s correct, Jerry. If the California Supreme Court approves headless PAGA actions, plaintiffs who signed arbitration agreements, will be able to bypass arbitration and proceed, directly with representative claims in court. It could also occur, though it seems contrary to the statute, that the court could find that a plaintiff who lacks a viable PAGA claim may nonetheless still pursue representative PAGA claims on behalf of others. On the other hand, if the court rejects a ‘headless’ PAGA theory, then individual PAGA claims will continue to be arbitrated, and if a plaintiff loses, then their case should be over. Oral argument in Leeper was supposed to occur in May, but the parties had a conflict, and the California Supreme Court doesn’t hear arguments all summer long, so even if argument occurs in September, we may not see a decision on this issue until year’s end. So, we have a ways to go before we will know the outcome.

Jerry: The bottom line, then, it isn’t just whether or not an employer has an enforceable arbitration agreement, it’s whether, under the pertinent case law, a plaintiffs’ lawyer can structure PAGA claims in such a way to avoid or bypass arbitration altogether. Well, before we wrap up, what are the practical takeaways in your advice for employers, given this mosaic of rulings?

Rebecca: Well, first, review your arbitration agreements, and especially if your workforce includes drivers, delivery personnel, others involved in moving goods through interstate commerce, because Flowers Foods may affect assumptions that you have had in place for many, many years regarding your arbitration program.

Eden: And second, continue viewing arbitration as an important tool, but not necessarily one that can be used in all PAGA cases.

Rebecca: And third, stay current in the law. This is a fast-moving area, and it’s an area where a single appellate decision can material change litigation strategy.

Jerry: Well, that’s a great summary from both of you. Eden and Rebecca, thanks so much for joining us today on The Class Action Weekly Wire, and thanks to all our loyal listeners for tuning in. We’ll continue to track developments on the arbitration front and it’ll culminate in Chapter 4 of the Duane Morris Class Action Review for 2027 to be published during the first week of January next year. Well, thanks so much for being here, and looking forward to being with you next time.

Eden: Thanks, Jerry, and thanks to the listeners.

Rebecca: Thanks for having us!

Duane Morris Takeaway: This week’s episode features Duane Morris partners Jerry Maatman, Jennifer Riley, Katherine Brodie, and Tony Guida with their discussion of Duane Morris’ Higher Education Class Action Review, highlighting several trends and developments shaping class action litigation in this sector.

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Episode Transcript

Jerry Maatman: Welcome to our listeners. Thank you for being here today for our podcast, the Class Action Weekly Wire. I’m Jerry Maatman, a partner at Duane Morris, and today is a very, very special edition of the show. We are celebrating episode number 150 of our podcast series. We appreciate the support of our listeners and guest speakers that have tuned in and joined us every week since 2023.

Joining me today is my co-host and colleague, Jennifer Riley, a partner and vice chair of the Class Action Defense Team, and our special guests today are two team leads from the Duane Morris Education Industry Group, which this morning was recognized by Chambers as one of the top practices in that space throughout the United States. We’re very proud of our industry group lawyers. Katherine Brodie, a partner in our Washington, D.C. office, and Tony Guida, a partner in our San Diego and Los Angeles offices, are joining us today. Thanks so much, everyone, for being here.

Jennifer Riley: It’s great to be here for our 150th episode, Jerry. Thanks for having me.

Katherine Brodie: It’s great to be here, thanks for having me.

Tony Guida: Yeah, thanks, Jerry. Thanks for having us.

Jerry: Today on the podcast, we’re discussing our newly released Higher Education Class Action Review, which is available on our Duane Morris Class Action Defense Blog. Jen, can you tell our listeners a bit about this new offering?

Jennifer: Absolutely, Jerry. So, this is the final e-book in our series of industry-focused class action references that we debuted earlier in 2026. This publication analyzes the key class action rulings and developments in 2025 throughout the higher education sector. It provides an outlook on trends impacting this particular industry for 2026 and beyond. So, we really hope that higher education institutions will benefit this resource in their efforts to comply with these ever-evolving laws and legal standards.

Jerry: Let’s start with the big picture and the value-add attributes of this publication. Why focus our reference on class actions in higher education?

Katherine: Thanks, Jerry. Well, we’ve been really looking forward to this publication because class actions in higher education are highly relevant. Basically, as you know well, class actions are a tool, a very influential procedural tool in the American legal system. And that really changed the stakes of litigation dramatically – they changed the cost, the risk analysis, damages can increase exponentially. Once a class action is formed and asserted, it drives litigation strategies, settlement pressures, institutional decision making. So, I think this is going to be an incredible resource for general counsel offices, so they can understand trends and identify, you know, where there might be risk exposure for them.

Jerry: So, the bottom line is simply the possibility of class action, exposure, and litigation changes the environment in which educational institutes operate.

Katherine: Absolutely. It’s already happening. There have been some, you know, major class action attempts on different theories against institutions of higher education. There’s been an uptick in lawsuit filings. And there’s been some successful class actions where large settlements have, you know, cost a lot of money to institutions, and I think they need to pay attention. So, this, again, is going to be an incredible resource for general counsels and their staff.

Jerry: When one drills down into the analytics, what sorts of cases or varieties of class actions are schools and universities dealing with these days?

Tony: The scope is incredibly broad now. Earlier generations of higher education litigation tended to focus on isolated cases like student claims for failure to deliver promised educational services, admissions misrepresentations claims, or employment discrimination claims. As you described in the e-book, today institutions face a myriad of class actions involving tuition and fee refunds both partial and full, antitrust allegations, Title IX compliance, financial aid practices, disability accommodations, labor and employment disputes, consumer protection laws, student privacy concerns, data breaches, and even litigation connected with emerging educational technologies.

Jerry: And certainly, I would think the COVID pandemic and its impact on the educational system really accelerated the pace of plaintiff’s lawyers focusing on institutions of higher education as targets in the class action space.

Tony: Yeah, absolutely. The pandemic created an unprecedented wave of litigation. Courts suddenly had to examine questions about remote learning and how that impacted their contractual obligations of institutions, student tuition refunds, the fiduciary duties of the governing boards, and overall institutional decision-making during a global emergency. Universities were forced into legal territory that, in many respects, had never been tested at that scale before.

Jennifer: And I would like to add, one thing that our publication highlights is that this isn’t just about more lawsuits, it’s also about a changing relationship between universities and their stakeholders.

Katherine: Yeah, and I’m really glad that you picked up on that point and that trend because we’re seeing it not just with class action lawsuits, but in higher education in general. I think, you know, traditionally, folks, the public didn’t really see students as customers, per se, right, of institutions of higher education, but there’s a lot of questions being asked now about the value of higher education, and the product being delivered, so to speak, the services being delivered to students. So, it’s created a situation where I think plaintiffs’ attorneys see institutions as uniquely situated for class action litigation. Universities have large populations, expansive data sets, lots of assets in some cases, policies that cover thousands or millions of people potentially, and they’re a perfect environment for class claims, and I think that the relationship has changed, and it’s now very much in the sights of consumer advocates.

Jennifer: Right, right, absolutely. And as you know, universities aren’t typical corporations.

Katherine: Right, we deal with that every single day. Higher education is very diverse. You’ve got nonprofits, you’ve got public institutions, you’ve got for-profits, you’ve got, you know, public institutions with their constitutional obligations, you’ve got nonprofit missions, and courts have to parse that out, right? These are unique institutions in our system, the American system. There’s, you know, oversight and, that is very unique. So, courts have struggled to reconcile, sort of, the obligations unique institutions have with modern consumer protection theories, and you’ve seen that play out in some of the COVID litigation. But they’re becoming more astute at it, and I think trying to parse their way through the expectations consumers should have versus the obligations and independence that institutions should have.

Jennifer: Can you give our listeners some additional examples of how that complexity plays out?

Katherine: Right. So, in a commercial litigation situation, the contract dispute is going to be the four corners of the contract and pretty clear, right? In higher education, there’s not necessarily a contract per se, so courts have looked to what is the contract, what is the promise, and the promise being made by the institution, so they’ve looked at statements in student handbooks, whether catalogs create enforceable promises, there may be enrollment agreements involved, there may be public statements on website, we saw that during COVID about the expectation of the institution being open. So, and then there’s academic judgment issues, like when does academic judgment cross into actionable negligence or misconduct? And then damages becomes very complicated, because how does a court assess the value of education itself? And that’s really tripped up a lot of courts in the past.

Jerry: Those are fascinating issues, because it sounds like class actions against educational institutions sit at the intersection of law and policy and institutional identity.

Tony: That’s exactly right, Jerry. And as you know, our practice is unique, in that we, in addition to being lawyers, have a policy team, and we actively lobby at the federal level. So, we follow these issues, and it’s really the purpose of the Higher Education Class Action Review, as well. That publication looks at aggregate litigation involving colleges and universities and school districts from both the analytical and practical perspectives.

Jerry: I know that the publication is downloadable on phones, and it comes out as an e-book. What can readers expect from this desk reference?

Jennifer: Well, the review examines the procedural frameworks governing class certification, as well as the substantive legal theories that are most commonly asserted against educational institutions, the strategic considerations that shape litigation outcomes, and all of those things. The goal really is to give readers an analysis and some practical insights into how these cases are evolving.

Tony: And it’s really intended for, you know, general counsel at colleges and universities, administrators, litigators, risk professionals, academics, really anybody trying to understand where higher education litigation is headed, and how class action exposure is reshaping institutional decision making and risk.

Jerry: As we wrap up, what do you think is the biggest takeaway for readers that you want them to walk away from in terms of having the publication on their bookshelf?

Tony: I think that higher education litigation is no longer niche or episodic. It’s becoming a defining operation on a strategic issue for institutions nationwide. Understanding class actions now is essential for anyone involved in higher education leadership or compliance. The consequences of these cases vary significantly depending on the institution’s size, resources, and risk profile. Some institutions may face threats that go to the core of their operations. Well, larger institutions may be better positioned to defend the claims but face heightened reputational and stakeholder risks.

Jerry: Well, well said, and great summary. Jen, Tony, and Katherine, thanks so much for joining us on our 150th podcast, and for discussing the Duane Morris Higher Education Class Action Review – 2026.

Jennifer: Listeners, remember to bookmark or download your free copy from the Class Action Defense Blog. Thanks, everybody, for tuning in.

Katherine: Thanks, and congratulations!

Tony: Yes, and thank you, listeners.

Duane Morris Takeaway: This week’s episode features Duane Morris partners Jerry Maatman and Brad Thompson with their discussion of Duane Morris’ Energy, Oil, & Gas Class Action Review, highlighting several trends and developments shaping class action litigation in this industry.

Check out today’s episode and subscribe to our show from your preferred podcast platform: Spotify, Amazon Music, Apple Podcasts, Podcast Index, Tune In, Listen Notes, iHeartRadio, Deezer, and YouTube.

Episode Transcript

Jerry Maatman: Welcome to our listeners! Thank you for being here for our weekly podcast, the Class Action Weekly Wire. I’m Jerry Maatman, a partner at Duane Morris, and I’m pleased that joining me today is my colleague and partner, Brad Thompson, who is a head of the Duane Morris Energy Industry Group. Welcome to our podcast today, Brad.

Brad Thompson: Thanks, Jerry. Happy to be here.

Jerry: Today on the podcast, we’re discussing the publication of a new desk reference in our brand-new e-book, The Duane Morris Energy, Oil, & Gas Class Action Review. Listeners can find the e-book on our blog, the Duane Morris Class Action Defense Blog. Brad, can you tell our listeners a bit about the review?

Brad: Sure thing, Jerry. So, Duane Morris has now released the fifth in a series of industry-focused class action publications, and this particular publication analyzes key-related rulings and developments from 2025 and significant legal decisions and trends that are impacting the class action space in the energy industry for 2026. We hope that companies and employers will benefit from this resource in compliance with these ever-evolving laws and standards.

Jerry: It seems the global energy landscape in 2025 underwent a significant transformation. Oil and gas companies, of course, continue to play a foundational role in industrial development and economic growth, but they’re ever increasingly coming under scrutiny from regulators, investors, consumers, and plaintiffs’ lawyers. How do you see, Brad, the tide turning in the class action space in this industry?

Brad: Yeah, Jerry, we certainly live in interesting times, to put it mildly, and this is an especially important topic right now. The litigation environment around energy companies has changed dramatically over the last several years, both in terms of its scope and complexity, and I think one thing that stands out today is that these lawsuits are no longer limited to what were traditional disputes over, maybe, contracts, like supply agreements or perhaps kind of isolated contamination events, or explosions, and those sorts of lawsuits.

And I think, Jerry, as demand for energy generally continues to rise globally, and those commodity prices continue to climb, I think we should expect that energy companies will find their earnings increasingly subject to class action attention and attacks, and so these cases are becoming broader, more ambitious, and historically, many energy-related lawsuits that focused on, again, those more localized environmental issues, or perhaps royalty disputes or commercial disagreements are expanding.

What we saw in 2025 is that plaintiffs are advancing claims that are tied to more long-term environmental impacts, these alleged failures to disclose climate-related risks. Of course, these just broader theories about corporate responsibility in general, and in many respects, I think these suits are attempting to address issues that more traditionally were viewed more as policy questions, particularly within the energy policy discussion and debate, rather than purely litigation questions as we’re seeing now.

Jerry: In my practice of defending companies and class actions for over four decades, what I’m seeing is a migration of very talented plaintiffs’ lawyers that follow the money, and the cases increase in size, they’re worth more, and what I saw in 2025 was a migration of these talented lawyers into the energy space, such that, we’re seeing kind of new theories, new lawyers in the space, and much bigger cases. What is your sense in terms of your dealing with your clients in the industry space in terms of that phenomenon?

Brad: Yeah, I think we should expect that migration, to use your term, will continue, and judges are increasingly confronting questions that are extraordinarily complex, both from a legal perspective, but also from a scientific perspective. You know, by way of example, how should liability be apportioned for something like environmental effects that may have developed over many decades involved a very complicated chain of title, countless entities and numerous individuals. In those scenarios, what type of climate risk disclosure is legally sufficient? To what extent can private litigation be used as some kind of mechanism to potentially drive systemic or policy change in such a global industry? These are certainly not easy questions, and courts across jurisdictions are certainly approaching them differently.

Jerry: In terms of the analytics that we study, we saw in 2025 as compared to 2024, a growth by about 10-15% in the filings of class actions nationwide. Is it your sense in the oil and gas industry that we’re going to see an increase in the activity in terms of the filing of class action lawsuits that challenge the industry?

Brad: Yeah, going back to your earlier point, Jerry, about kind of following the money, I think, again, you know, we live in interesting global times, and these energy industry issues will continue to be at the forefront of geopolitical focus. And so, first of all, there’s going to be kind of inherently a heightened public awareness surrounding climate and environmental issues – so oil and gas companies will certainly be at the center of that focus. And moreover, investors, regulators are increasingly demanding more transparency regarding sustainability practices, things like climate-related risk, exposure. Plaintiff firms are becoming increasingly sophisticated in identifying large-scale theories that can support class treatment, or at least class theories with increasingly larger damage model theories, so at the same time, scientific modeling and data analytics have become much more advanced – which plaintiffs often use to support their causation theories and damages models. So, you know, whether these new and emerging theories ultimately succeed, certainly another question, but they are shaping litigation strategy in 2026.

Jerry: Talking about the defense side of the V in these cases, given that the stakes are so enormous, what do you see in terms of selection of defense and how defenses are crafted and engineered in the industry?

Brad: Sure. The outcome of a class action can be significant, potentially devastating for a company – not only financially, but reputationally, operationally. And that’s why corporate defendants have to approach these cases from a broader vantage point, not just in a litigation vacuum. A successful defense strategy today has to be thoughtful, multifaceted. It’s probably no longer enough to just narrowly focus on a single procedural issue or an isolated factual dispute, and companies to have coordinated strategies that involve not just litigation defense, but also regulatory compliance, internal governance, public disclosures, there’s insurance considerations, and sometimes crisis management response type considerations as well, so I think early case assessment is critical, because that key class certification decision can dramatically alter the trajectory of these cases.

Jerry: I’ve always thought the M.O. of the plaintiffs’ bar was to find the client, file the lawsuit, certify it, and then monetize it. And that class certification, obviously, is the holy grail when it comes to class actions, and that once a case is certified, it has weight, the plaintiffs’ attorney has leverage. So, in terms of the oil and gas and energy industry, what are your thoughts with respect to the importance of class certification?

Brad: Oh, extremely important. These energy-related cases, as you know, Jerry, often involve highly individualized facts. There’s a variety of regulatory frameworks, both at the state and the federal level, and multifaceted, complicated causation-type questions and issues. And so those issues can create significant hurdles for plaintiffs that are trying to establish those key factors, like commonality and predominance under those class action standards.

Jerry: It sounds like, then, from a holistic defense perspective, that these sorts of complexities certainly require careful planning, engagement of experts to assist very early on in the litigation, and that these lawsuits are basically shaping the future of energy law more broadly.

Brad: Yeah, Jerry, I think that’s exactly what’s happening, and these cases are going to influence, and are already influencing, how energy companies think about things like risk management, environmental disclosures, governance structures, and their long-term business planning. And we’re also seeing litigation become a part of just this broader energy transition conversation globally. And as our world moves towards more energy from all sources, which of course includes alternative or renewable energy sources, traditional energy companies are also navigating these enormous legal and commercial pressures simultaneously.

Jerry: Well, that brings us back conveniently to close the loop in terms of the purpose behind this resource, and why it’s so timely for clients in the energy space.

Brad: Yeah, exactly. I mean, the goal here was to create a practical and comprehensive desk reference guide for corporate counsel, energy industry professionals that are facing these increasingly complex challenges, and we wanted to provide a clear understanding of the various legal theories that are driving the current litigation and class action climate, and the broader implications for the future of energy law.

Jerry: Well, I concur. The field is rapidly evolving, so companies can be helped by a resource like this from both a strategic and practical sense. Listeners, of course, can download a copy for free of the e-book on the Class Action Defense Blog. Well, thank you, Brad, for being here today, and thank you, loyal listeners, for tuning in.

Brad: Thanks so much for having me, Jerry. It was great to be here. Really appreciate it.