By Gerald L. Maatman, Jr., Jennifer A. Riley, and Ryan Garippo
Duane Morris Takeaway: The Telephone Consumer Protection Act (TCPA), 47 U.S.C. § 227, et seq., has long been a focus of class action litigation. Since the TCPA was enacted 30 years ago, the methods and technology that businesses use to engage and interact with customers has evolved and changed. The trend of states enacting or amending their own mini-TCPAs shows no signs of slowing down, making this subject area a likely continued focus for the plaintiffs’ class action bar in years to come.
To that end, the class action team at Duane Morris is pleased to present the 2025 edition of the TCPA Class Action Review. We hope it will demystify some of the complexities of TCPA class action litigation and keep corporate counsel updated on the ever-evolving nuances of these issues. We hope this book – manifesting the collective experience and expertise of our class action defense group – will assist our clients by identifying developing trends in the case law and offering practical approaches in dealing with TCPA class action litigation.
Click here to bookmark or download a copy of the TCPA Class Action Review – 2025 e-book.
Stay tuned for more TCPA class action analysis coming soon on our weekly podcast, the Class Action Weekly Wire.
Duane Morris Takeaway:This week’s episode of the Class Action Weekly Wire features Duane Morris partner Jerry Maatman and associates Jesse Stavis and Anshul Agrawal with their discussion of the key trends analyzed in the 2025 edition of the ERISA Class Action Review, including analysis of two major rulings and their significant impact on ERISA litigation in 2025.
Stay tuned for the publication of the ERISA Class Action Review on Tuesday, March 25.
Jerry Maatman: Welcome to our listeners. Thank you for being here on our weekly podcast series, the Class Action Weekly Wire. I’m Jerry Maatman, a partner with Duane Morris, and joining me today are my colleagues, Jesse and Anshul, and we’re here to talk about Episode 93 on class action issues involving ERISA. Welcome, gentlemen.
Jesse Stavis: Thanks, Jerry, always happy to be part of the podcast.
Anshul Agrawal: Yeah, thank you so much, Jerry.
Jerry: Today on our podcast we’re going to highlight our publication of the second edition of the Duane Morris ERISA Class Action Review. Jesse, can you share with our listeners a little bit about this publication?
Jesse: Absolutely. The surge of class action litigation filed under the Employee Retirement Income Security Act, or ERISA, over the last several years definitely persisted in 2024. Class action litigators in the plaintiffs’ bar continued to primarily focus on challenges to ERISA fiduciaries’ management of 401(k) and other retirement plans. The class action team at Duane Morris is pleased to present the ERISA Class Action Review – 2025, which analyzes the key ERISA-related rulings and developments in 2024, as well as the significant legal decisions and trends impacting this type of class action litigation for 2025. We hope the companies will benefit from this resource in their compliance with these evolving laws and standards.
Jerry: Well, certainly the subject matter of the book in terms of the key rulings in 2024 showed, I think, a mixed bag of results for both the defense bar and plaintiffs. Anshul, let’s talk a little bit about what you have identified as the biggest issues over the past 12 months, and that would be the increasing amount of class action litigation over 401(k) forfeiture issues. It’s certainly an area of concern for our clients, and we’re seeing some major developments. Could you share with our listeners your view of kind of the heart of these sorts of claims?
Anshul: Yeah, absolutely. So, the central issue here revolves around how employers handled forfeited 401(k) contributions. So specifically, the employers matching contributions when an employee leaves before they’re fully vested. Normally, if an employee leaves early, they forfeit these unvested funds, and many companies have been using this money to offset their own contributions in future years. However, there’s been a shift, because in 2024 we saw several class actions challenging this practice with plaintiffs, arguing that this forfeited money should instead be used to cover the administrative costs of the plan rather than reducing the employer’s future contributions. These claims have made it past motions to dismiss in several cases, including Perez-Cruet v. Qualcomm and Rodriguez v. Intuit. So, courts are increasingly finding that these claims may be valid under ERISA’s fiduciary duty standards.
Jerry: My take is that these cases are having real world consequences for people at companies that are in charge of managing 401(k) programs going forward. Jesse, do you think that these sorts of lawsuits are going to have lasting effects on the way in which employers treat these sorts of funds?
Jesse: Oh, definitely. The outcome of these cases could set new precedents. Courts have been indicating that companies might be violating their fiduciary duties if they’re not using forfeited funds for the benefit of plan participants. For example, in Perez-Cruet, the court found that Qualcomm’s use of forfeited funds for current employees’ accounts rather than administrative costs may have been a breach of fiduciary duty. Now this case, along with others like it, shows that companies could face real risks if they continue using forfeited funds solely to offset their own contributions. What’s particularly important here is the courts are saying that even if companies follow the plan’s documentation, they still have a duty to act in the best interest of the participants. This could definitely lead to a shift in how companies structure their 401(k) plans.
Jerry: I think it’s fascinating that we’re dealing with a statute that’s more than six decades old, but we’re bumping up against issues that have never been decided. Another thing that comes to my mind is the impact of socially and environmentally conscious investing, or what’s called ESG investing. And the big huge decision this year in the Spence v. American Airlines case. Anshul, can you comment on your take in terms of what was going on in that particular ruling?
Anshul: Yeah, sure. So, in the Spence case, a plaintiff challenged American Airlines’ investment decisions in the company’s 401(k) plan. The plaintiff argued that the plan’s fiduciaries breached their duties by selecting underperforming ESG funds and by choosing managers who prioritized these types of environmental and social goals over profitability. What’s notable here is that the plaintiff wasn’t just challenging the individual investments, but also the fund managers themselves for their ESG focus. The court found these claims plausible, allowing the case to move forward. So, this decision definitely has the potential to change how fiduciaries view ESG factors in their investment strategies, particularly when considering ERISA’s duty of prudence. If courts continue to allow these types of claims to proceed, it could lead to greater scrutiny of ESG investments in retirement plans.
Jerry: That to me is quite a headline and something that’s incredibly important to corporations and our clients to the extent that many are focused on ESG considerations, and this and the court’s ruling. That that might be a breach of fiduciary duties, seems to me to be a reordering of the playing field and the risks and compliance strategies when you’re looking in this area. Jesse, what would be your take on how this is going to play out in 2025
Jesse: Well, Jerry, I think that what makes Spence so interesting is that it highlights this tension between traditional profit-driven investing on the one hand, and socially conscious investments on the other. Now, in Spence, the court seemed to accept the argument that if ESG funds systematically underperform, fiduciaries could be seen as breaching their duty of prudence by investing in it. This opens up a new avenue for plaintiffs to challenge fiduciaries, and it’s something employers and investment managers will need to keep an eye on in the future. Now, we also saw some shifting regulatory perspectives here, especially with the Department of Labor’s rule allowing fiduciaries to consider ESG factors which is now under challenge. The Supreme Court’s Loper Bright decision which overturned Chevron deference could have significant implications for how courts evaluate these kinds of rules, and it might lead to more restrictive interpretations of fiduciary duties in the ESG context.
Jerry: Anshul, do you think that the Spence case is kind of a demarcation point where you’re going to see an increased focus by the plaintiffs’ bar and bringing class actions over this issue of putting notions other than profit first, and that that can translate into a breach of fiduciary duty?
Anshul: Yeah, I mean, that’s definitely possible. I think if other courts follow the lead of the Northern District of Texas, then we could see a rise in sort of these ESG-related lawsuits, particularly against employers or plan managers who prioritize these types of factors over pure financial performance. If more plaintiffs succeed in these claims, it could lead to more cautious approaches by fiduciaries when considering these ESG factors.
Jerry: I’ve always thought the business model of the plaintiffs’ class action bar is file a case, certify the case, then monetize the case by securing settlements. And 2024 certainly was a dramatic year when you talk about class action settlements. What about in the ERISA space in terms of how the plaintiffs’ bar did in taking down large-scale settlements?
Jesse: Well, Jerry, plaintiffs did very well in securing high dollar settlements in 2024, although not quite as well as in 2023. In 2024, the top 10 ERISA class action settlements totaled $413.3 million. This was a drop from 2023, when the top 10 settlements totaled $580.5 million.
Jerry: That’s still a lot of money, and that’s only the top 10, so, it dramatically illustrates the risk and compliance stakes for corporations in the ERISA class action space.
Well, thank you, gentlemen, for joining us on this week’s Class Action Weekly Wire and for providing us and lending us assistance in navigating the area of ERISA class actions, which is certainly at the top of the agenda for most corporations in terms of compliance activity.
Jesse: Thanks for having me, Jerry, and thanks, as always, to all the listeners.
Anshul: Thank you so much, Jerry, and thank you to everyone for tuning into the Weekly Wire
By Gerald L. Maatman, Jr., Rebecca Bjork, and Anna Sheridan
Duane Morris Takeaways: On March 13, 2025, in International Rights Advocates v. Mars Inc. et al., No. 1:24-CV-00894 (D.D.C. Mar. 13, 2025), Judge Royce Lamberth of the U.S. District Court for the District of Columbia ruled that the lawsuit filed by International Rights Advocates (IRA) against Mars Inc., Cargill Inc., and Mondelez International Inc. was not properly removed as it did not meet the “amount in controversy” prong of diversity citizenship and could not be aggregated. At the same time, the Court denied IRA’s Motion for Attorneys’ Fees and Costs, finding that the removal was not objectively unreasonable, as there had not yet been any “’clear, controlling case law from the D.C. Circuit on non-aggregation in the DCCPPA [D.C. Consumer Protection Procedures Act] context.” Id. at 20. The decision melted away the companies’ hopes of dodging local jurisdiction and set the stage for a potentially bittersweet legal battle.
Case Background
IRA filed this lawsuit in 2023, claiming that Mars, Cargill, and Mondelez sugarcoated their efforts to prevent child labor in their cocoa supply chains, and mislead consumers about the ethical sourcing of their chocolate products. IRA then filed an Amended Complaint alleging only misrepresentation in violation of the DCCPPA, invoking the private attorney general or representative-action provision, which authorizes a public interest organization to bring an action challenging an unlawful trade practice on behalf of itself and the “general public.” IRA sought an injunction requiring the defendants to correct their allegedly misleading public statements. The defendants then removed the case to federal court, arguing that the cost of compliance with an injunction (product labeling, public messaging, or both) met the monetary threshold required for federal jurisdiction. However, the Court did not buy into that argument wholesale.
The Ruling in International Rights Advocates v. Mars, Inc.
Judge Lamberth ruled that the defendants failed to demonstrate that the financial stakes met the standard for federal jurisdiction. He found that, rather than counting the total compliance costs, the amount should be divided among the affected population. More importantly, this case clearly set out a standard that a representative action under the DCCPPA brought on behalf of the general public cannot aggregate damages by the total costs combined to the defendants. This case follows precedent set in Breakman v. AOL LLC, when the court held that compliance cost could be used to determine the amount in controversy in an action where separate and distinct claims are presented on behalf of multiple parties only when the cost running to each plaintiff meets the amount in controversy requirement.545 F. Supp. 2d 96, 106 (D.D.C. 2008).This led Judge Lamberth to remand the case back to the D.C. Superior Court, where the chocolatiers will have to litigate the representative action.
Implications For Companies
This ruling serves as cautionary tale for employers hoping to whisk cases away to federal court by piling on compliance costs. Courts are increasingly scrutinizing how these figures are calculated. For companies facing consumer protection claims, this decision signals that removing cases to federal court will not always be a piece of cake. Employers must be prepared for cases to remain in state or local court where procedural rules might not be as favorable.
By Gerald L. Maatman, Jr., Jennifer A. Riley, and Sharon L. Caffrey
Duane Morris Takeaways: Clients, ranging from some of the world’s largest manufacturers and insurance companies to startup companies and individual inventors, turn to Duane Morris for counsel and representation in claims involving products liability and toxic torts. For years, Duane Morris has worked with clients to develop cost-containment and strategic litigation plans designed to minimize the risk, business disruption and potentially staggering cost of products liability and toxic tort litigation. Our goal is to provide value by acting as proactive counselors and advisors, rather than simply responding to particular problems in isolation. To that end, the class action team at Duane Morris is pleased to present the Products Liability & Mass Torts Class Action Review – 2025. This publication analyzes the key rulings and developments in 2024 and the significant legal decisions and trends impacting both product liability class action litigation and mass tort litigation for 2025. We hope that companies and employers will benefit from this resource and assist them with their compliance with these evolving laws and standards.
Click here to bookmark or download a copy of the Products Liability & Mass Torts Class Action Review – 2025 e-book.
Stay tuned for more products liability and mass tort class action analysis coming soon on our weekly podcast, the Class Action Weekly Wire.
By Gerald L. Maatman, Jr., Jennifer A. Riley, and Courtney L. Baird
Duane Morris Takeaway: Within the vast realm of class action litigation, consumer fraud class actions remain at the forefront. Consumer fraud class actions typically involve a class of consumers who believe they were participating in a legitimate business transaction, however, due to a merchant or company’s alleged deceptive or fraudulent practices, the consumers were actually being defrauded. A wide variety of conduct gives rise to consumer fraud claims. For example, if a business or merchant makes misleading statements about a retail product’s origin, quality, or potential use, over-exaggerates a product’s benefits, imposes classic bait-and-switch tactics on consumers – wherein consumers are forced to make decisions based on inaccurate or incomplete information – or charges fees or surcharges that are unrelated to the subject of the merchant’s transaction with the consumer, a claim for consumer fraud will arise because these actions may harm consumers.
Every state has consumer protection laws, and consumer fraud class actions require courts to analyze these statutes both with respect to plaintiffs’ claims, and also with respect to choice of law analyses when a complaint seeks to impose liability upon multiple states’ consumer protection laws.
To that end, the class action team at Duane Morris is pleased to present a new publication – the 2025 edition of the Consumer Fraud Class Action Review. We hope it will demystify some of the complexities of consumer fraud class action litigation and keep corporate counsel updated on the ever-evolving nuances of these issues. We hope this book – manifesting the collective experience and expertise of our class action defense group – will assist our clients by identifying developing trends in the case law and offering practical approaches in dealing with consumer fraud class action litigation.
Click here to bookmark or download a copy of the Duane Morris Consumer Fraud Class Action Review – 2025 eBook.
Stay tuned for more consumer fraud class action analysis coming soon on our weekly podcast, the Class Action Weekly Wire.
Duane Morris Takeaway:This week’s episode of the Class Action Weekly Wire features Duane Morris partners Jennifer Riley and Shireen Wetmore and special counsel Eden Anderson with their discussion of the key trends analyzed in the 2025 edition of the Private Attorneys General Act Review. Litigation brought under the Private Attorneys General Act (“PAGA”) poses unique challenges for employers operating in California, and 2024 was no exception; the past year saw major developments in the legislative reform of the PAGA as well as significant rulings pre- and post-reform shaping the landscape for these types of representative actions in 2025.
Bookmark or download the Private Attorneys General Act Review e-book here, which is fully searchable and accessible from any device.
Jennifer Riley: Welcome to our listeners. Thank you for being here again for our weekly podcast, the Class Action Weekly Wire. I’m Jennifer Riley, partner at Duane Morris, and joining me today are Shireen Wetmore and Eden Anderson. Thank you so much for being on the podcast today, guys.
Shireen Wetmore: Thank you. Jen, happy to be part of the podcast.
Eden Anderson: Thanks, Jen. I’m glad to be here.
Jennifer: So, today on the podcast we are discussing the recent publication of this year’s edition of the Duane Morris Private Attorneys General Act (or PAGA) Review. Listeners can find the e-book publication on our blog, the Duane Morris Class Action Defense Blog. Shireen, can you start by telling our listeners a little bit about the publication?
Shireen: Absolutely, Jen. As a quick refresher for our audience, California’s Private Attorneys General Act is a statute that authorizes employees to step into the shoes of the California Labor Commissioner and sue their employers for civil penalties under the Labor Code. As has been the case for really the past decade, claims filed under the PAGA continue to be among the most popular filed in California wage and hour matters. Frequently, these claims are preferred by plaintiffs over class actions because of the limited standing requirements and the ability for plaintiffs to bring class-like representative claims without class certification requirements, and the ability to avoid removal to federal court.
The PAGA reforms in June of last year are starting to change how these cases are litigated and when they’re brought. but by all accounts, 2024 was a very active year on the PAGA litigation front, and to assist with understanding what this means for employers facing PAGA claims, Duane Morris has released the Duane Morris PAGA Review – 2025, the latest edition of this annual publication. It analyzes key PAGA rulings and litigation developments in 2024, and the significant trends that are apt to impact these types of representative actions in 2025. So, we hope that companies and employers will benefit from this resource as they work to keep up with these evolving laws and standards.
Jennifer: Great, thank you so much for that overview, Shireen. Eden, what are some of the key takeaways from the publication in regard to PAGA litigation in 2024?
Eden: Yeah, according to data maintained by California’s Department of Industrial Relations, the number of PAGA notices filed with the LWDA has increased exponentially over the past two decades, and was the highest number ever in 2024. With that said, we saw legislative change to PAGA in July of 2024. The amendments to PAGA now provide employers with greater ability to cure violations and avoid litigation, caps on penalties that can be imposed, requirements for PAGA cases to be manageable, and limits on statutory standing so that a PAGA plaintiff can now only seek penalties for violations that they personally suffered and which affected other employees. We’re just starting to see how those amendments are affecting PAGA litigation, but we anticipate they won’t stop the plaintiffs’ bar from continuing to pursue these claims in droves.
Jennifer: Interesting, and this area is certainly evolving quickly. Shireen, can you tell our listeners about some of the developments that occurred during 2024 in particular?
Shireen: As Eden said, the PAGA reforms significantly modified PAGA, and they will impact both how and when employees bring these claims, and how employers will respond to them. But there are thousands and thousands of pre-reform PAGA claims that are still in the pipeline, and that will be subject to some of the significant rulings from 2024. So in 2024, we saw development of a new strategy that became significantly more popular amongst plaintiffs following the California Supreme Court’s ruling in Adolph v. Uber. And that’s the case which addressed the arbitration of individual PAGA claims and held that so long as an employee asserts that they’re an aggrieved employee, they maintain standing to pursue a representative claim in court under PAGA. Adolph clarified that should the employee lose their individual claim in arbitration, the employee would also lose standing to maintain a representative PAGA claim in court. However, if the employee prevailed in arbitration, or settled their individual PAGA claim, they would maintain standing to pursue non-individual representative PAGA claims on behalf of all other “aggrieved employees.” What we saw in 2024, in reaction to those holdings, was that plaintiffs began filing PAGA claims with only representative components purporting to waive their individual PAGA claims as a workaround. These so-called “headless” claims seemingly go against the ruling in Adolph and other cases.
Jennifer: Thank you so much, Shireen. How has that “headless” PAGA strategy played out for the plaintiffs in terms of well has it worked?
Eden: Well, there’s been an update in this area, even after publication of our book. Back in April of 2024, the California Court of Appeal held, in Balderas v. Fresh Start Harvesting, that representative PAGA claims could still be maintained even without an actionable individual PAGA claim so long as the plaintiff alleges he or she suffered a Labor Code violation. And as Shireen mentioned, the plaintiffs’ bar began relying on Balderas to support their strategy to avoid arbitration, and that strategy was to disclaim individual recovery in PAGA cases. But then, in late December 2024, the Court of Appeal reversed course and held in Leeper v. Shipt that a PAGA action necessarily includes both representative and individual PAGA claims and that a plaintiff cannot disclaim individual relief to avoid arbitration. And this is an issue that, ultimately, the California Supreme Court may need to weigh in on.
Jennifer: Thanks so much, Eden. Let’s talk briefly about the Turrietta case. On August 1, 2024, the California Supreme Court issued an opinion that had major ramifications for employers in PAGA actions, particularly where there’s parallel litigation pending. Shireen, can you walk us through the key points of that decision?
Shireen: Absolutely. The key issue in Turrieta v. Lyft was whether plaintiffs in separate PAGA actions could intervene, object to a settlement, or challenge the judgment in another parallel, as you said, PAGA matter—specifically in Turrieta, the parties had reached a settlement and the proposed intervenor plaintiffs sought to inject themselves into the case. The court ruled that, as non-parties to the settlement, the other plaintiffs did not have standing to intervene or object to the settlement. This means that an employer should be able to settle one PAGA action without fear of interference from other plaintiffs who may be pursuing similar, parallel claims. Such settlements will still require court approval, which is the backstop to ensure there are no shenanigans in the settlement process.
Jennifer: Wow, that’s a pretty big ruling. Eden, what do you think that ruling means for employers facing multiple overlapping PAGA actions, as so many employers are in California right now?
Eden: Yeah, Jen, it’s a game changer. Employers now have more leeway to settle PAGA claims without worrying about other plaintiffs from different cases coming in and objecting to or trying to disrupt the settlement. The Turrieta court emphasized that having multiple plaintiffs intervening would complicate the litigation and hinder the enforcement of labor laws, which is exactly what PAGA was designed to avoid. And this decision really solidifies an employer’s ability to resolve PAGA cases without interference from other plaintiffs.
Jennifer: So, this decision seems like a win for employers. Let’s shift gears to Estrada v. Royalty Carpet Mills, which may be described as not a win for employers. The court issued another important ruling in 2024 – what did the court decide in that case, and why does it matter?
Eden: Yeah, in Estrada, the California Supreme Court addressed whether trial courts can dismiss PAGA claims if they’re too “unwieldy” and not “manageable.” The case involved a large class of employees, and the trial court decertified the class and then dismissed the PAGA claims for lack of manageability. The California Supreme Court held that trial courts do not have inherent authority to dismiss PAGA claims due to lack of manageability. And what that means is that—for PAGA cases that were filed before the recent legislative amendments—employers can no longer argue that a PAGA case should be dismissed because it’s just too complex or unmanageable. However, as I mentioned earlier, for newly filed PAGA cases, the recent amendments recognize and codify a manageability defense.
Jennifer: Thanks, Eden. Shireen – do you think that decision will change the way courts can handle PAGA cases moving forward?
Shireen: Yes, definitely, I think it will, in a couple of ways that remain to be seen. The Supreme Court clarified, as Eden said, that the manageability of a case isn’t a valid reason to dismiss a PAGA claim under “old PAGA.” Unlike class action cases, pre-reform PAGA suits are not bound by the same requirements for manageability. And so, Estrada essentially removed that key defense for employers trying to get out of these unwieldy PAGA actions and makes it harder to avoid facing the full scope of PAGA claims. However, the Supreme Court emphasized the need for prudence from plaintiffs and suggested that plaintiffs need to be careful in how they represent their claims. The result is likely twofold: for pre-reform cases, there may be more scrutiny of the sufficiency of the notice itself, which is now the primary method for managing the scope of pre-reform PAGA claims. Similarly, the reforms from the legislature which explicitly include manageability may influence how courts review the intended scope of the pre-reform PAGA claims. And certainly, we anticipate that manageability will be a key tool for employers in addressing post-reform PAGA claims.
Jennifer: Great insights into these rulings, ladies, and it seems like 2024 was a pivotal year for PAGA law in California. We will continue to track all of these important PAGA rulings and developments and share the implications with our loyal blog readers. Thanks to Shireen and Eden for being here today, and thank you to our listeners for tuning in. Please stop by the blog for a free copy of the PAGA Review e-book.
Eden: Thank you for having me, Jen, and thank you, listeners.
Shireen: Thanks so much, everybody. See you next time.
By Gerald L. Maatman, Jr., Jennifer A. Riley, Eden Anderson, and Shireen Wetmore
Duane Morris Takeaways: One law making California so different – and so challenging – for employers is the Private Attorneys General Act (“PAGA”), which authorizes employees to assert claims for alleged labor violations. Such a worker acts as “a private attorney general” to pursue civil penalties against an employer as if they were an arm of the State of its agencies. PAGA claims are not class actions per se – instead, they are known as “representative actions – but they pose analogous risks and exposures like class actions brought under the California Labor Code. Plaintiffs bring thousands of PAGA cases every year, and, because PAGA plaintiffs can bring suit on behalf themselves and other employees, the stakes are often significant, with companies exposed to risks similar to those arising from class action litigation. The PAGA, however, has its own specific rules of the road, which differ from the rules elucidated in familiar Rule 23 jurisprudence. The explosion of PAGA litigation has resulted in a complex body of case law that is often difficult to navigate, particularly in terms of the application of arbitration agreements and representative action waivers. Given the wide adoption of such arbitration agreements, companies are struggling to grasp how recent decisions regarding the PAGA and arbitration impact their businesses.
To that end, the class action team at Duane Morris is pleased to present this year’s edition of the Private Attorneys General Act Review – 2025. We hope it will demystify some of the complexities of PAGA litigation and keep corporate counsel updated on the ever-evolving nuances of these issues. We hope this book – manifesting the collective experience and expertise of our class action defense group – will assist our clients by identifying developing trends in the case law and offering practical approaches in dealing with PAGA litigation.
Click here to bookmark or download a copy Duane Morris Private Attorneys General Act Review – 2025 eBook.
Stay tuned for more PAGA class action analysis coming soon on our weekly podcast, the Class Action Weekly Wire.
Duane Morris Takeaway:This week’s episode of the Class Action Weekly Wire features Duane Morris partner Jerry Maatman, senior associate Anna Sheridan, and associate Zev Grumet-Morris with their discussion of the key trends analyzed in the 2025 edition of the Duane Morris Discrimination Class Action Review.
Bookmark or download the Discrimination Class Action Review e-book here, which is fully searchable and accessible from any device.
Jerry Maatman: Welcome loyal blog listeners and readers to our next installment of our podcast series, the Class Action Weekly Wire. I’m Jerry Maatman, a partner with Duane Morris, and joining me today are my colleagues, Zev and Anna. Thanks so much for agreeing to be on our podcast.
Anna Sheridan: Thanks, Jerry. I’m happy to be here.
Zev Grumet-Morris: Thank you, Jerry. Glad to be here.
Jerry: Today on the podcast we’re discussing the recent publication of this year’s edition of the Duane Morris Discrimination Class Action Review. Listeners can find this particular e-book on our blog, the Duane Morris Class Action Defense Blog. Anna, can you tell our listeners a little bit about this desk reference?
Anna: Absolutely, Jerry. Class action litigation in the discrimination space remains a key focus of skilled class action litigators in the plaintiffs’ bar. Duane Morris is pleased to present the Discrimination Class Action Review – 2025. This publication analyzes key discrimination-related rulings and developments in 2024, and the significant legal decisions and trends impacting discrimination class actions for 2025. We hope that companies and employers will benefit from this resource in their compliance with the evolving laws and standards.
Jerry: Well, in following class action litigation developments over the 20 years, it’s very clear that discrimination-related litigation is a key focus of the plaintiffs’ class action bar, especially in recent years, and especially in terms of what’s newsworthy these days coming out of Washington, D.C. Zev, can you share with us your thoughts with respect to the relative success rates that plaintiffs have enjoyed in this particular area of the law?
Of the 15 total motions for conditional certification filed in federal courts in 2024, the plaintiffs won certification 8 times, or at a success rate of 53%, while 7 motions were denied.
Zev: Yeah, absolutely, Jerry. So, over the past year, what we’ve seen are plaintiffs are succeeding in certifying their cases at a slightly higher rate than ever before. In 2024 alone, for example, courts actually granted class certification 53% of the time, which is slightly up from the 50% that we saw in 2023. And what this shows us is that despite some of the challenges. plaintiffs are actually more successful in achieving certification. And what that is, it’s a reflection of courts becoming more inclined to allow these cases to move forward, particularly in discrimination cases where there’s a broader societal awareness of issues like racial inequality and gender discrimination.
Jerry: That’s an interesting comment. Anna, what’s your take with respect to the sorts of defenses or the sorts of situations where, conversely, the defense bar is successful in blocking or fracturing these sorts of cases and preventing them from being certified as a class action?
Anna: It’s certainly become a much more rigorous process in the wake of the Wal-Mart Inc. v. Dukes decision. Courts have been stricter about class certification for a class to be certified; plaintiffs still need to meet the requirements of Rule 23, especially around the rule of commonality in discrimination cases. This often means that they’re trying to prove alleged discriminatory practices or policies are applying uniformly across different departments and sometimes even across state lines. It’s not just enough for one person to claim that they were discriminated against – plaintiffs need to show that this is a systemic, broader issue, and if they can’t do that, defense counsel is going to argue that the class should not be certified.
Jerry: Well, you mentioned the Wal-Mart v. Dukes ruling – by my way of thinking, that might be the most significant and critical decision ever in the history of American jurisprudence when it comes to employment discrimination in the class action space. I remember that day when the decision was handed down and legal publications focused on the Supreme Court’s ruling for days. Given the significance of the decision, Zev, do you see sort of a pendulum swinging with respect to the way in which federal courts are applying the Wal-Mart v. Dukes standards in Rule 23 situations?
Zev: Yeah, absolutely, Jerry. And really, it’s a combination of several factors as to why we’re seeing that so public opinion is becoming more critical of large corporations and social movements like Black Lives Matter and #MeToo have absolutely kept workplace inequality in the public spotlight, and businesses are facing not only increasing employee-friendly legislation, but also a more aggressive plaintiffs’ bar. Courts, especially in sort of the current climate we’re dealing with, are more inclined to acknowledge these issues and are allowing these cases to move forward, especially in the discrimination context. And this heightened awareness around issues of inequality has made it harder for employers to escape accountability, and we’re seeing more court rulings that favor plaintiffs in this space.
Anna: But it’s not all one sided – while plaintiffs have gained some ground, courts are still very serious about ensuring that the class action standards are met, and those standards were set by Wal-Mart v. Dukes. The bar is high, and plaintiffs can’t simply rely on generalized statements like ‘I was harmed, and I believe others were, too.’ They have to provide concrete evidence that the issues they face were systemic across the class.
Jerry: Those are great insights, and a great take from the current interpretations of the Wal-Mart case. As we look forward into 2025, what do you see as the future of discrimination-based class action litigation? Do you think the plaintiffs’ bar is going to continue to push in this space and the number of lawsuits brought against Corporate America will rise again?
Anna: Without a doubt, the public’s growing interest in workplace equality and the ongoing social justice movements will continue to provide that momentum for plaintiffs. Employers can expect to see more class actions in 2025, particularly as discrimination remains a high-profile issue, especially in Washington, D.C. Even though there are challenges in securing class action certification, the plaintiffs’ bar is becoming more strategic and sophisticated in their approaches – they’re going to continue to press forward. Businesses will have to remain vigilant in defending against these claims, it’s a constantly evolving landscape.
Jerry: Well, thanks for that information. The Review also focuses on settlement numbers. I’m a big believer that you can tell a lot by what’s going on in courtrooms throughout the United States by looking at how the plaintiffs’ bar is filing the case, certifying the case, and then monetizing it in a settlement. How did plaintiffs do in the last calendar year in terms of securing hefty settlements in this particular area?
The top 10 discrimination class action settlements totaled $356.8 million in 2024, down from $762.2 million in 2023 and $597 million in 2022.
Zev: Yeah, plaintiffs came out well in 2024, Jerry, but nowhere to the extent that they did in 2023. The top 10 discrimination settlements in 2024 totaled about $356 million – $356.8 million, to be exact, which, don’t get me wrong, is a lot – but compared to the previous year, it’s slightly down where the top 10 totaled $762.2 million.
Jerry: Well, those are large numbers, nonetheless, and I thank you both for providing your thought leadership in this particular space, and reviewing in a at 100,000 foot level what corporations can expect in the coming year. So, thanks so much for joining us today in the Class Action Weekly Wire, and listeners – you can download our publication and desk reference off the Duane Morris Class Action Defense Blog.
Zev: Thanks, Jerry, and thank you to everyone listening.
By Gerald L. Maatman, Jr., Justin R. Donoho, and George Schaller
Duane Morris Takeaways: On February 10, 2025, Judge Aleta A. Trauger of the U.S. District Court for the Middle District of Tennessee deniedclass certification in a case involving breach of contract and a disputed element of mutual assent a/k/a meeting of the minds, in Hall v. Warner Music Group Corp., No. 22-CV-0047 (M.D. Tenn. Feb. 10, 2025). The ruling is significant as it shows that plaintiffs who file class action complaints alleging breach of contract cannot satisfy Rule 23’s commonality requirement where the issue of whether the parties agreed to a material term of contract requires individualized inquiry into the parties’ minds and whether they met.
Background
This case involving lack of mutual assent is one of the many since the famous case of Raffles v. Wichelhaus, 159 Eng.Rep 375 (1864), in which the defendant agreed to purchase cotton arriving in a ship named “Peerless” arriving while cotton prices were low, whereas the plaintiff seller had in mind a different ship by the same name arriving while cotton prices were high. (And where the English High Court found no binding contract).
In Hall, the plaintiffs, two musical artists, sued for breach of implied contract against a record label. The parties had entered into a written recording agreement providing for the payment of 8% royalties at a time before the invention of digital streaming and not expressly covering distribution through digital streaming. Hall, slip op. at 2. In 2005, when the label started streaming plaintiffs’ music digitally both domestically and internationally, it began to pay the plaintiffs at the higher rate appearing on their royalty statements of 50%. Id. at 3, 14. For foreign digital streaming, the 50% rate was applied after the deduction of a payment to the foreign distributor. Id. at 12-13. It was common in the industry and a consistent course of dealing of the defendant to apply royalty rates to digital streaming revenues received only after payment to the foreign distributor. Id. The plaintiffs accepted these digital streaming royalty payments for years without viewing the royalty statements or “attempting to identify the revenue base against which a royalty rate for foreign streaming was applied . . . until [one of the plaintiff’s] first discussion with one of his attorneys in this case.” Id. at 15.
The plaintiffs moved for class certification under Rule 23. The plaintiffs maintained that they met the commonality requirement because they and other artists with legacy contracts received royalty payments for foreign streaming sales with statements indicating an unqualified 50% royalty. Id. at 10-11. In contrast, the record label maintained that a claim for breach of implied contract requires the plaintiffs to prove that a valid and enforceable contract was formed between the label and “each class member, which will require an individualized inquiry into the knowledge, understanding, and intent of the artists, including whether the artist even looked at the royalty statements, whether the artists construed them to offer an implied amendment, what exactly the artist believed those implied terms to be, whether the artist had a good-faith belief about a possible rescission claim, whether the artist would have rescinded unless paid at the source, whether the artist intended to forbear, and when (if ever) these events occurred.” Id. at 11 (emphasis in original). In other words, according to the record label, the common question, “was an implied contract formed?” could not be answered by a simple yes or no without such an individualized inquiry. Id.
The Court’s Decision
The Court agreed with defendants and held that plaintiffs did not carry their burden of showing commonality.
Central to Court’s holding was the “problematic question of mutual assent.” Id. at 18. As the Court explained, “even if the court presumes that other putative class members’ royalty statements look like the plaintiffs’ and that there are common questions regarding the defendants’ conduct that may yield common answers (i.e., that the royalty statements do not expressly reflect that the royalties are calculated based [after paying the foreign distributor]), it is clear that the threshold question of whether an implied contract between [the label] and each putative class member was formed does not yield a common answer but, instead, will depend entirely on the particularized circumstances of each artist whose contract, like the plaintiffs’, does not expressly provide for royalties on foreign digital streaming.” Id.
In short, the Court reasoned that “the named plaintiffs’ particularized circumstances show that they simply never thought about whether an implied contract had been formed or its terms until approached by lawyers. Other artists may have paid closer attention to their business arrangements.” Id.
In conclusion, the Court noted that, “to the extent there are questions of fact or law common to the plaintiffs and all putative class members, the relative importance of these common questions pales in comparison to the importance of those that do not yield a common answer — primarily the question of whether implied contracts were formed at all.” Id. at 23.
Implications For Companies
The Hall decison is a win for defendants of breach of contract class actions involving the issue of whether the parties had a meeting of the minds on a material term of contract. In such cases, the Hall decision can be cited as useful precedent for showing that the commonality requirement is not met because individualized inquiries predominate when it comes to analyzing evidence regarding a meeting of the minds.
The Court’s reasoning in Hall applies not only in cases involving: (1) commercial form contracts, like in Hall, but also (2) alleged employment contracts, see Cutler v. Wal-Mart Stores, Inc., 927 A.2d 1 (Md. Ct. App. 2007) (affirming denial of motion for class certification, stating, “Any determination concerning a ‘meeting of the minds’ necessarily requires an individual inquiry into what each class member, as well as the [employer’s] employee who allegedly made the offer, said and did”); In re Wal-Mart Wage & Hour Emp. Pracs. Litig., 2008 WL 3179315, at *19 (D. Nev. June 20, 2008) (denying motion for class certification, stating, “Plaintiffs’ breach of contract claims would involve particularized inquiry into contract formation, including such issues as meeting of the minds”); (3) form real estate contracts, see Haines v. Fid. Nat’l Title of Fla., Inc., 2022 WL 1095961, at *17 (M.D. Fla. Feb. 17, 2022) (denying motion for class certification, stating, “If a buyer and seller interpreted [the agreement] the way [seller] interprets the provision, their meeting of the minds would have a significant impact upon any potential liability for [seller]. In that regard, the buyer’s and seller’s state of mind for each transaction are relevant . . . individualized discovery and factfinding regarding each buyer’s and seller’s intent and understanding would be required”); and (4) alleged contracts regarding the use of AI, see Lokken v. UnitedHealth Group, Inc., 2025 WL 491148, at *8 (D. Minn. Feb. 13, 2025) (finding insureds’ claim against health insurer for breach of contract regarding insurer’s use of AI-based automated decision making technologies not preempted by the Medicare Act and therefore allowed to proceed to discovery, raising the question of whether parties’ minds met via the insurer’s explicit descriptions of its “claim decisions as being made by ‘clinical services staff’ and ‘physicians,’ without mention of any artificial intelligence”).
By Eden E. Anderson, Rebecca S. Bjork, Jennifer A. Riley, and Gerald L. Maatman, Jr.
The Federal Arbitration Act (FAA) turns 100 years old today.
In enacting the FAA on February 12, 1925, Congress eliminated the power of the states to require that claims be resolved in court when contracting parties instead agree to resolve their claims in arbitration. The FAA’s purpose was to reverse longstanding judicial hostility to arbitration agreements, and to place arbitration agreements on equal footing with other contracts under the law.
As we celebrate the FAA’s 100th birthday, we highlight three key areas in which the FAA’s scope and application have come under scrutiny in recent years.
The Scope Of The Transportation Worker Exemption Remains Unclear
The FAA does not apply to employment contracts of seamen, railroad employees, and workers engaged in foreign or interstate commerce. The scope of this so-called transportation worker exemption has been a hotbed for litigation in recent years, with the U.S. Supreme Court addressing the issue in multiple decisions. The high court’s decisions in Southwest Airlines Co. v. Saxon, 596 U.S. 450 (2022), Domino’s Pizza, LLC v. Carmona, et al., 143 S. Ct. 361 (2022), and Bissonnette v. LePage Bakeries Park St., LLC, 61 U.S. 246 (2024), emphasized that the transportation worker exemption is to be narrowly construed and that, for the exemption to apply, a worker must play a direct and necessary role in the free flow of goods across borders.
In the wake of these decisions, state and federal courts are now grappling with what that means and whether warehouse workers, last-mile delivery drivers, ride-hailing drivers, and fueling technicians meet the “direct and necessary role” test. While such classes of workers bear little resemblance to the seamen and railroad employees expressly excluded from the FAA’s scope, in jurisdictions hostile to arbitration, including California courts and the Ninth Circuit, the transportation worker exemption has been found to apply. It is therefore important for employers to include language in arbitration agreements that permits alternative enforcement of the agreement under state law if the FAA is found not to apply.
Does EFASHA Exempt Entire Cases From Arbitration?
On March 3, 2022, President Biden signed into law the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act (EFASHA). Under the EFASHA, an employee alleging sexual harassment or assault, whether individually or as a class representative, may pursue their claims in court rather than in arbitration, regardless of whether they agreed with their employer to arbitrate their claims.
But what happens when a plaintiff alleges such claims, but also alleges claims that permissibly can be arbitrated? Courts too have begun answering that question. Some courts have concluded that the EFASHA’s statutory language requires that the employee’s entire case remain in court, reasoning that the EFASHA makes a pre-dispute arbitration agreement invalid and unenforceable “with respect to a case” which means the entire case. (9 U.S.C. § 402(a) (emphasis added).) The court so concluded in Johnson v. Everyrealm, Inc., 657 F. Supp. 3d 535 (S.D.N.Y. 2023), in denying the employer’s motion to compel the plaintiff’s sex harassment, race discrimination, and retaliation claims to arbitration.
The outcome, however, differed in Mera v. SA Hosp. Grp., LLC, 675 F. Supp. 3d 442 (S.D.N.Y. 2023), wherein the plaintiff alleged claims that he experienced a hostile work environment on account of his sexual orientation and that he and other employees suffered state and federal wage and hour infractions. The court there determined that, because the wage and hour claims did not “relate to” the hostile work environment claim, the wage and hour claims could be compelled to arbitration. Id. at 447.
If a plaintiff can allege a plausible claim that triggers the EFASHA’s application, they may be successful in keeping all their claims in court, or possibly only some of them.
We anticipate continued litigation in this area, and an uptick in the assertion of tenuous sex-based harassment claims that might not otherwise have been plead.
Appellate Issues Raised By Recent Case And Legislative Developments
What happens to the trial court proceedings after a decision on a motion to compel arbitration has also been a hotly litigated issue.
In Smith v. Spizzirri, 601 U.S. 472 (2024), the U.S. Supreme Court held that, when a federal court finds that a dispute is subject to arbitration and a party has requested a stay of the court proceeding pending arbitration, the FAA compels the court to stay, and to not dismiss, the proceeding. Consequently, if a plaintiff’s claims are compelled to arbitration and the district court proceedings stayed, there will be no judgment with an associated right to appeal. Thus, the plaintiff’s only recourse—if they dispute the arbitration ruling—will be to seek permission to pursue an interlocutory appeal or to pursue an appeal of the forum issue long after the fact if and when they lose in arbitration.
Another stay issue that will surely be litigated concerns a 2024 amendment to California’s Code of Civil Procedure. In California, if a motion to compel arbitration is denied and that decision is appealed, there is now no longer an automatic stay of the court proceedings during the pendency of an appeal. As a result, plaintiffs can seemingly proceed with their claims in court while the employer seeks a reversal of the forum issue on appeal, unless the appellant seeks and obtains a stay from the trial court. As this law on its face disfavors arbitrate, we anticipate it will be challenged.
For a more comprehensive summary of FAA-related litigation issues, Duane Morris’s 2025 Wage & Hour Class and Collective Action Review, available here, features an entire Chapter on this topic.
