Class Action Defense

October 17, 2023October 17, 2023 by Class Action Defense

Webinar Replay: Year-End EEOC Strategy and Litigation Review

Duane Morris Takeaway: Duane Morris partners Jerry Maatman, Jennifer Riley, and Alex Karasik host a panel discussion on the Equal Employment Opportunity Commission’s role in workplace discrimination law and recent developments in its enforcement and litigation strategies. The panelists identify key trends emerging from EEOC-initiated litigation and analyze the agency’s newly released strategic plan for fiscal years 2022-2026. This virtual program will empower corporate counsel, human resource professionals and business leaders with insights into the EEOC’s latest enforcement initiatives and provide strategies to minimize the risk of drawing the EEOC’s scrutiny.

October 15, 2023 by Gerald L. Maatman, Jr.

D.C. Federal Court Denies Class Certification For COVID-19 Remote Learning Claims Due To Inadequacy Of The Class Representative

By Gerald L. Maatman, Jr., Jennifer A. Riley, and George J. Schaller

Duane Morris Takeaways: In Gur-Ravantab, et al. v. Georgetown University, No. 1:22-CV-01038, 2023 U.S. Dist. LEXIS 179493 (D.D.C. Oct. 5, 2023), Judge Trevor McFadden of the U.S. District Court for the District of Columbia denied Plaintiffs’ motion for class certification on the grounds that the named Plaintiff was neither an adequate representative of the proposed class nor even a member of it.

For companies facing motions for certification motions in class actions, this decision is instructive in terms of considerations over the circumstances where a named plaintiff may fall short of satisfying the adequacy requirement under 23(a)(4).

Case Background

The named Plaintiff, Emir Gur-Ravanatab (“Plaintiff”), was a Class of 2020 graduate of Georgetown University. Id. at 1. In March 2020 of his final semester, the COVID-19 pandemic swept the nation. Id. at 2. Defendant, Georgetown University (“Defendant”), like many other schools, announced its transition to remote instruction for the rest of the Spring 2020 semester. Id.

Plaintiff alleged that he entered a contract with the Defendant, and under that contract, Plaintiff paid tuition in exchange for a guarantee of “in-person classroom learning and other services.” Id. at 1-2. Plaintiff alleged that there was a material difference in value between in-person and remote instruction. Therefore, despite Defendant’s transition to remote instruction, Plaintiff was never paid the difference. Id. at 2.

Plaintiff alleged breach of an express and implied contract claims, and an unjust enrichment claim. Id. Plaintiff sought compensatory and punitive damages, and restitution for his claims. Id. He also moved to certify a class on behalf of other students who similarly formed contracts with Defendant and were enrolled as undergraduate students “during the Spring 2020 semester who paid tuition and Mandatory Fees.” Id. Plaintiff alleged the class covered roughly 7,300 other current and former university students. Id.

The Court’s Decision

The Court denied Plaintiff’s motion for class certification. It held that the named Plaintiff was not an adequate representative of the class he proposed to certify nor even a member of the class. Id. at 1.

The Court reasoned the requirements of all class action suits are well-settled under Rule 23. Id. at 3. These requirements are known as “numerosity,” “commonality,” “typicality,” and “adequacy.” Id. at 4. Additionally, the Court relied on U.S. Supreme Court precedent that “has ‘repeatedly held’ that ‘a class representative must be a part of the class and possess the same interest and suffer the same injury as the class members.’” Id. After a plaintiff and his proposed class satisfy those requirements, then the plaintiff and the proposed class must fall within one of the three “buckets” of class actions enumerated under Rule 23(b). Id. at 4-5. The Court found Plaintiff “stumbled before reaching Rule 23(b)” as he was “both an inadequate representative of the proposed class, and a non-member” of it. Id. at 5.

The Court focused its ruling on the adequacy prong under Rule 23(a). The Court opined that “[Plaintiff] does not share the same interests as the other class members, and indeed, has a potential conflict of interest with them,” and therefore is “not an adequate class representative.” Id. at 7. Plaintiff suffered two problems, including: (i) Plaintiff’s mother is an employee of the university; and (ii) Plaintiff did not personally pay tuition or mandatory fees. Id. at 7-8. Therefore, the Court determined “he lack[ed] the kind of concrete stake in the outcome of th[e] litigation necessary to be the vigorous advocate the class is entitled to.”

As to potential class conflicts, Plaintiff’s mother was a Turkish language instructor with the university, and hence he had a close familial relationship to a person who may be harmed by a judgment against the university. Id. at 8. Further, Plaintiff testified in his deposition that his parents, including his mother “exert a ‘pretty major’ influence over his decisions.” Id. The Court reasoned that “Rule 23 requires that class representatives be able to engage in arm’s-length dealings with the opposing side” and Plaintiff did not meet that standard. Id. However, the Court acknowledged that this conflict on its own “would not be enough, standing on its own, to defeat adequacy,” but other problems persisted. Id.

Plaintiff’s second problem was he did not share the same interest in this case as the other class members. Id. Plaintiff “sued for a refund of the difference in value between the education he paid for and the one he got,” but Plaintiff “did not pay for an education at all.” Id. The Court considered Plaintiff’s student account as the operative measure for educational payments. Id. at 8-11.

On balance, the Court construed the student account two ways. Either, Plaintiff did “not pay [Defendant] a dime,” Id. at 9, or Plaintiff “got more money out of [Defendant] that semester than he put in.” Id. at 11. Based on the Court’s reasoning, both accountings lead to the same problem, i.e., that Plaintiff “will likely have no compensatory damages to claim,” and “without compensatory damages, [Plaintiff] cannot claim punitive damages either.” Id. Therefore, the Court held that Plaintiff could not obtain meaningful relief, and thus, “he lack[ed] ‘the incentive to represent the claims of the class vigorously.’” Id. As a result of Plaintiff owing no money towards tuition and Mandatory Fees, the Court found he “quite simply is not a member of the proposed class.” Id.

The Court further discussed the second named Plaintiff, Emily Lama, and her exclusion from the class as well because she was “enrolled as a graduate student during the Spring 2020 Semester,” meaning she also did not fit the undergraduate class description. Id. at 11-12.

Accordingly, as there was no named Plaintiff to represent the class, the Court denied Plaintiffs’ motion for class certification. Id. at 12.

Implications For Companies

Companies confronted with motions for class certification should take note that the court in Gur-Ravantab relied on Plaintiffs’ inability to adequately represent the class based on a fact intensive analysis that disqualified the named Plaintiff as a suitable class representative. Further, from a practical standpoint, companies should carefully evaluate class representatives for unique characteristics that are distinguishable from the proposed class.

October 14, 2023 by Gerald L. Maatman, Jr.

EEOC Issues New Guidance On Harassment In The Workplace

By Gerald J. Maatman, Jr., Alex W. Karasik, and Derek Franklin

Duane Morris Takeaways: On September 29, 2023, the EEOC issued a new Proposed Enforcement Guidance on Harassment in the Workplace (the “Guidance”). The Guidance provides insights into how employers can handle evolving workplace realities and developing trends with harassment claims. Notably, the Guidance addresses how digital technology and social media postings can contribute to a hostile work environment. It also addresses the U.S. Supreme Court’s 2020 landmark decision in Bostock v. Clayton County, where Supreme Court held that discrimination based on sexual orientation or gender identity constitutes sex-based discrimination under Title VII of the Civil Rights Act of 1964 (“Title VII”). The Guidance is open to public comment through November 1, 2023; if issued in final form, it will mark the first update to the EEOC’s official harassment guidance in nearly 25 years.

For employers, the Guidance is a “must read” in terms of preventing future workplace harassment claims.

Workplace Harassment In The Digital Landscape

The Guidance spotlights how social media postings and other online content can contribute to hostile work environments, even if it occurs outside of the workplace and is not work-related. For instance, the Guidance cites the following examples of conduct occurring in an employee’s “virtual work environment” that employers can be liable for: “[a] sexist comments made during a video meeting, [b] racist imagery that is visible in an employee’s workspace while the employee participates in a video meeting, or [c] sexual comments made during a video meeting about a bed being near an employee in the video image.”

In addition to discussing conduct occurring in a “virtual work environment,” the Guidance also clarifies that conduct occurring in non-work-related contexts can contribute to a hostile work environment if it impacts the workplace. This includes electronic communications through phones, computers, and social media. For example, the Guidance cautions that, if an employee’s private social media posting subjects a co-worker to racial epithets, and other co-workers discuss the posting at work, then that posting “can contribute to a racially hostile work environment.”

Harassment Based On Sexual Orientation And Gender Identity

Another notable aspect of the Guidance is that it incorporates the U.S. Supreme Court’s 2020 landmark decision in Bostock v. Clayton County, 140 S. Ct. 1731, 1747 (2020), which held that Title VII’s prohibition of sex-based discrimination encompasses discrimination based on sexual orientation and gender identity.

While Bostock concerned an allegedly discriminatory employment discharge and did not involve harassment, the EEOC states in the Guidance that the Supreme Court’s reasoning “logically extends to claims of harassment.” The Guidance therefore dictates that “sex-based harassment includes harassment on the basis of sexual orientation and gender identity, including how that identity is expressed.”

The Guidance lists several examples of conduct that can constitute this type of harassment, including: “[a] epithets regarding sexual orientation or gender identity; [b] physical assault; [c] harassment because an individual does not present in a manner that would stereotypically be associated with that person’s gender; [d] intentional and repeated use of a name or pronoun inconsistent with the individual’s gender identity (misgendering); or [e] the denial of access to a bathroom or other sex-segregated facility consistent with the individual’s gender identity.”

The EEOC also includes a hypothetical fact pattern in the Guidance depicting harassment based on gender identity. In that hypothetical, supervisors and co-workers of a fast food employee who identifies as female commonly referred to the employee using her prior male name and pronouns, asked questions about her sexual orientation and anatomy, and asserted that she was not female. In addition, customers “intentionally misgendered” the employee and “made threatening statements to her,” which the employer only responded to by reassigning the employee to a workstation where customers could not see her. These facts, according to the EEOC, established harassment based on gender identity and, therefore, sex-based discrimination under Title VII.

Takeaways For Employers

The Guidance is a “must read” resource for employers to navigate potential harassment concerns. It provides employers with an opportunity to revise their policies and protocols to better reflect the current legal landscape and the evolution of digital technology. The Guidance also highlights the EEOC’s emphasis on enforcing Title VII’s prohibition of harassment based on sexual orientation and gender identity.

Employers should review their policies and practices to ensure they adequately protect against, and provide avenues to report, potential harassment that takes place virtually. Likewise, employers may wish to consider incorporating examples of harassment given by the EEOC when implementing harassment prevention measures.

October 13, 2023October 13, 2023 by Class Action Defense

The Class Action Weekly Wire – Episode 34: Seventh Circuit Vacates Verdict On Incidental Work & Overtime Pay

Duane Morris Takeaway: This week’s episode of the Class Action Weekly Wire features Duane Morris partner Jennifer Riley and special counsel Brandon Spurlock with their discussion of a Seventh Circuit ruling issued last week that vacated a jury verdict of $225,000 in an FLSA overtime wage suit brought by field technicians regarding pre- and post-shift tasks.

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

Episode Transcript

Jennifer Riley: Thank you for being here for the next episode of our Friday weekly podcast, the Class Action Weekly Wire. I’m Jennifer Riley, partner at Duane Morris, and joining me today is special counsel Brandon Spurlock. Thank you for being on the podcast, Brandon.

Brandon Spurlock: Thanks Jen. I’m very happy to be here.

Jen: So today on the podcast we are discussing a recent ruling by the Seventh Circuit in a wage & hour lawsuit brought in Illinois. It’s called Meadows v. NCR Corp. Brandon, can you tell us a little about the Fair Labor Standard Act, which is the statute that the plaintiff invoked in this case, to set the stage for our discussion?

Brandon: The Fair Labor Standards Act, or FLSA, is the federal regulation enacted by the U.S. Department of Labor that establishes minimum wage, overtime pay, recordkeeping, and youth employment standards affecting employees in the private sector and in Federal, State, and local governments.

Jen: Thank you for that background – and now, can you tell us a little about the plaintiff’s allegations in the NCR case?

Brandon: Absosutely. At issue in this case is the FLSA’s overtime regulation. This case was filed by a field technician of NCR, which is a company that makes ATM machines. The plaintiff asserted that NCR failed to pay overtime compensation. The plaintiff contended that NCR was routinely shorting field technicians’ wages by allegedly refusing to pay them overtime for hours they worked in place of breaks, or before and after their shifts ended. The plaintiff claimed he performed many “incidental” work activities before and after his work shifts and during meal breaks, for which he was not paid, including things like responding to emails and phone calls, stocking his work van with required materials for his job each day, and mapping out his work travels. NCR had argued that it agreed to pay workers for unauthorized overtime, so long as the hours were properly recorded using the company system.

Jen: So this is an interesting case, among other reasons, because it proceeded to trial. Brandon, can you tell our listeners a bit about what the jury concluded at the trial?

Brandon: Yes, indeed, the case did go to trial, and the jury returned a verdict for the plaintiff. The court approved the verdict and awarded the plaintiff approximately $225,000 in back overtime pay plus interest, plus attorney fees. NCR, however, requested a new trial. The trial court denied that motion, but on appeal the Seventh Circuit vacated the jury’s verdict and remanded the action.

Jen: So the Seventh Circuit disagreed with the jury’s findings. How did the court come to that conclusion?

Brandon: Good question. So the Seventh Circuit determined that the district court had erred in allowing the plaintiff to claim he was owed payment for hours he had worked, but had not recorded. The Seventh Circuit stated that under the FLSA, employees can only expect to be paid for “incidental activity … if two conditions are met: the employer elected to pay for such activities by contract, custom, or practice and the employee engaging in such activities complied with all the requirements imposed … by that contract, custom, or practice.” So here the Seventh Circuit concluded that the plaintiff had not met that second condition.

The Seventh Circuit then vacated the jury’s verdict and sent the case back to the district court for further proceedings on whether the plaintiff should get a new trial.

Jen: It will be interesting to see here what the future holds for this case. We will be sure to keep our listeners up to date on new developments. Brandon, thanks so much for joining me today and for the rundown on this ongoing dispute. Thanks everyone for tuning in.

Brandon: Thanks for having me Jen, and thank you listeners.

Jen: See you next week on the Class Action Weekly Wire!

October 11, 2023 by Gerald L. Maatman, Jr.

Report From London: What A Comparative Analysis Of International Class Action Litigation May Teach USA-Based Companies

By Gerald L. Maatman, Jr.

Duane Morris Takeaways: USA-based companies are experiencing a deluge of class action litigation. At the Thought Leaders Global Class Action Conference in London, Jerry Maatman of the Duane Morris Class Action Defense Group gave a keynote address on the state of U.S. class action litigation and how Asian, European, Australian, and African-based corporations should be “looking around the corner” to ready themselves for new class action theories spreading to their respective jurisdictions. Class and collective-based litigation is likewise growing at a precipitous rate in non-U.S. jurisdictions, and corporations operating in the global economy are subject to a patchwork quilt of procedural and substantive differences in how the plaintiffs’ class action bar is suing defendants and seeking large-scale recoveries.

The London Thought Leaders Global Class Action Conference – with a robust two day agenda and roster of speakers from Europe and Asia – examined diverse issues on cutting-edge class actions on a global basis. Subjects included the phenomenon of the “continuous evolution” of class action theories; the surge of crypto class actions claims; collective, opt-in and opt-out representative actions in England; the dawn of ESG class actions filed by NGO’s, consumers, workers, and advocacy groups; data privacy litigation on a class and collective action basis; and cross-border consumer fraud class action theories.

I had the privilege of speaking on how U.S. class action litigation impacts the global economy and litigation in non-U.S. jurisdictions. For a comparative law panel discussion, I presented along with Professor Miguel Sousa Ferro of the University of Lisbon Law School, and the Managing Partner of Milberg Sousa Ferro, a leading class action firm based in Portugal. We discussed – and debated – a comparison of the procedural differences between USA-style opt-out class action mechanisms and European Union-style opt-in / opt-out procedures. We used the recent opioid class action products liability class actions and European mass tort lawsuits as a case study to compare and contrasts the pros and cons of each judicial system and the array of mechanisms to protect consumers, injured parties, and corporate defendants.

Against that backdrop, Professor Ferro and I analyzed the future of global class actions, especially in light of the record-breaking class action settlement numbers in the USA in 2022 and 2023, which is fueling the explosive growth of class and collective litigation. We agreed that as to various substantive areas, privacy litigation is posed to remain “white hot” and grow over the next few years, as the pace of technology continues to underlie all aspects of the economy.

October 6, 2023 by Class Action Defense

The Class Action Weekly Wire – Episode 33: Ninth Circuit Revives Mask Policy Bias Suit

Duane Morris Takeaway: This week’s episode of the Class Action Weekly Wire features Duane Morris partner Jerry Maatman and associate Brittany Wunderlich with their discussion of a Ninth Circuit’s ruling issued this week that reversed United Airlines’ win in a disability bias suit brought a baggage handler under FEHA in California.

Check out today’s episode and subscribe to our show from your preferred podcast platform: Spotify, Amazon Music, the Samsung Podcasts app, Podcast Index, Tune In, Listen Notes, iHeartRadio, Deezer, or our RSS feed.

Episode Transcript

Jerry Maatman: Thank you, loyal blog readers welcome to our Friday weekly podcast entitled the Class Action Weekly Wire. Today I’m joined by my colleague Brittany Wunderlich, and we’re going to be talking about issues in California, where Brittany practices law. Welcome, Britney.

Brittany Wunderlich: Thanks, Jerry. I’m happy to be here

Jerry: Today we’re going to talk about a recent ruling from the Ninth Circuit involving Bezzina v. United Airlines. Brittany, what’s this case about? And why is it important to employers in terms of what the Ninth Circuit wrote in this particular case?

Brittany: So, in California to be successful on a disability discrimination claim under the Fair Employment and Housing Act, otherwise known as FEHA, a plaintiff must show 3 things. First, that they suffered from a disability; second, that they were otherwise qualified to do his or her job; and third, that they were subjected to an adverse employment action because of their disability.

Jerry: To me, what makes this case interesting is the disability in question. Could you share with our listeners a little bit about the background facts, and why those facts kind of dictated the result in the Ninth Circuit’s ruling?

Brittany: Absolutely. So, this case was filed by a baggage handler working for United, who alleged that the company would not accommodate his request to wear a face shield while he was working inside rather than a mask, and this was during the height of the COVID-19 pandemic. Specifically, the plaintiff stated that he was a military veteran who suffered from post-traumatic stress disorder, and so wearing a mask caused him anxiety. On the other hand, the defendant argued that the baggage handler’s position was too unpredictable to grant the accommodation, and that, denying the request was a reasonable business decision in response to the global pandemic. The defendant thereafter place the plaintiff on an unpaid leave of absence when he would not wear his face mask, which the plaintiff alleged was an adverse employment action against him because of his disability.

Jerry: This to me is a really interesting case because of the CDC guidelines, which in essence say face masks are the option of choice, and the safest device for presenting preventing the spread of COVID-19, and that only in alternatives should face shields be used. How did the plaintiff’s lawyer litigate that question that issue to get around that problem?

Brittany: Well, at the trial court the district court granted the defendant’s motion for summary judgment. The plaintiff then appealed the decision, and the Ninth Circuit reversed and remanded the case. The Ninth Circuit stated that the issue of whether the plaintiff’s request was reasonable should be for a jury to decide. The Ninth Circuit also reasoned that a jury could find that the plaintiff was able to perform the essential job duties while wearing a face shield and without endangering the health and safety of others. The Ninth Circuit then stated that the question of whether placing the plaintiff on an unpaid leave of absence was an accommodation, or instead an adverse employment action was an unresolved, disputed fact.

Jerry: Very interesting to me. One thinks that the COVID-19 pandemic is over, but the legal disputes are still in the courts still ripe and very interesting outcomes. I think it proves the old adage that every ADA case is different, and rises and falls on the individual circumstances of the plaintiff. Well, Britney, thanks so much for sharing your thought leadership and expertise looking at that. Thanks so much for being a guest on the Class Action Weekly Wire.

Brittany: Thanks, Jerry. It’s nice being here, and thanks to all your listeners.

October 5, 2023 by Gerald L. Maatman, Jr.

Class Action Defense Blog – Next Week Live From London!

By Gerald L. Maatman, Jr.

Duane Morris Takeaway: On October 10-11, 2023, Jerry Maatman will blog live from London as he travels across the pond to present on global class action issues at the Thought Leaders 4 Dispute’s event called Group Litigation and Class Actions 2023 – The 3rd Annual Forum. This global event will feature thought leaders from a variety of legal backgrounds in Europe, Asia, Africa, and the Americas to discuss hot topics in the global class action world.

Jerry will present key trends from the Duane Morris Class Action Review – 2023, and discuss the current state of class action litigation in the United States.

Check in to the blog next week to learn more and get information directly from the London event about what employers and corporations need to know.

Click here to learn more about the event.

October 5, 2023 by Class Action Defense

North Carolina Federal Court Certifies Class While Refusing To Decertify FLSA Collective Action

By Gerald L. Maatman, Jr., Zachary J. McCormack, and Emilee N. Crowther

Duane Morris Takeaways: In Wade et al. v. JMJ Enterprises LLC, No. 1:21-CV-506 (M.D.N.C. Sept. 30, 2023), Judge Loretta C. Biggs of the U.S. District Court for the Middle District of North Carolina granted in part Plaintiff’s motion to certify a Rule 23 class involving North Carolina Wage and Hour Act (“NCWHA”) claims by certifying Plaintiffs’ claims for unpaid wages due for training, mandatory meetings, and improper reductions from employee time logs. In addition, Judge Biggs ruled that the Fair Labor Standards Act (“FLSA”) preempted Plaintiff’s claim for failure to pay overtime wages under the NCWHA. In turn, Judge Biggs denied Defendants’ motion to decertify the FLSA collective action claims involving failure to pay overtime wages. This decision provides a good roadmap of the interplay in “hybrid wage & hour lawsuits” relative to the standards for certification of both class actions and collective actions.

Case Background

JMJ Enterprises LLC and owner Traci Johnson Martin (collectively “JMJ”) operate three group homes in Greensboro, North Carolina. The group homes assist children with mental illnesses or emotional disturbances, as well as adults suffering from mental illnesses and developmental issues. The Named Plaintiff, Tiffany Wade (“Ms. Wade”), was employed at Fresh Start Home for Children, one of the three group homes operated by JMJ from February 2021 to April 2021, and alleged she was not fully compensated for her time attending training sessions and mandatory meetings. Specifically, Wade alleged three claims under the FLSA, including failure to pay minimum wages, failure to pay overtime wages, and retaliation. Wade also brought two state law claims against JMJ under the NCWH for failure to pay wages due and failure to pay overtime wages. In her ruling, Judge Biggs issued an order in response to Wade’s motion to certify her class claims pursuant to Rule 23(a) and Rule 23(b)(3) of the Federal Rules of Civil Procedure, and JMJ’s attempt to decertify Wade’s FLSA collective action.

The Court’s Order

State Law Claim Preempted By The FLSA

Wade alleged two state law claims against her former employer under the NCWHA. In the first claim, Ms. Wade alleged JMJ failed to pay wages due pursuant to N.C. Gen. Stat. § 95-25.6 and § 95-25.7. Section 95-25.6 is commonly known as the “payday statute” and requires an employer to pay “all wages and tips accruing to the employee on the regular payday.” See Martinez-Hernandez v. Butterball, LLC, 578 F. Supp. 2d 816, 818, 821 (E.D.N.C. 2008). In the second state law claim, Wade alleged JMJ failed to pay overtime wages pursuant to N.C. Gen. Stat. § 95-25.4.

Judge Biggs concluded that Wade’s second state law claim, the overtime claim, was preempted by the FLSA. The Court reasoned that N.C. Gen. Stat. § 95-25.14 provided an exemption to employees covered under the FLSA. Although arising from the same facts, Wade’s wages due claim did not fall under any NCWHA exemption and was deemed sufficiently separate and distinct from her FLSA claims for minimum wage and overtime wages considering that her theory of liability did not invoke provisions of the FLSA.

Rule 23 Class Certification

Considering Wade’s first state law claim, the wages due claim, the Court ruled that it was not preempted by the FLSA, Judge Biggs focused on whether Ms. Wade could meet her burden to certify a class involving similar NCWHA claims. Ms. Wade, as class representative, sought to establish a class of hourly, non-exempt employees who worked at JMJ with similar wage claims. The Court considered the four prerequisites established in Rule 23, including numerosity, commonality, typicality, and adequacy of representation. Gunnells v. Healthplan Servs., Inc., 348 F.3d 417, 423 (4th Cir. 2003).

The Court agreed with Wade that nearly 100 class members rendered joinder impracticable, therefore satisfying the numerosity requirement. Judge Biggs ruled commonality was achieved through JMJ’s improper time recording and wage policies and practices, which determined compensation for class members. Even though each member had distinguishable circumstances, the Court opined that the heart of the claims was similar, and typicality was met. Regarding adequacy of representation, the Court looked at the resume of L. Michelle Gessner at Gessner Law, PLLC, who was appointed as class counsel. JMJ argued that she could not competently represent this class by pointing to Gessner’s extensive objections during Wade’s depositions (which JMJ contended demonstrated Gessner’s lack of sufficient understanding and control of the case). Judge Biggs rejected this defense position. Relying on Gessner’s 20 plus years of experience practicing labor and employment law, specifically complex wage and hour class and collective action cases, The Court held that she was adequate counsel for purposes of representing the class.

Defendants’ Motion To Decertify The FLSA Collective Action

In order for this FLSA collective cction to proceed to trial, Judge Biggs applied a heightened standard to the “similarly situated” analysis. Wade argued that all employees making up the proposed collective action were paid based on a common policy, had similar roles at JMJ, and worked at one JMJ’s three group homes. The Court agreed that JMJ had common policies and practices with respect to training, mandatory meetings, overtime pay, and employee time logs, which applied to all employees and proved a common resolution of the FLSA claims was possible. Judge Biggs further determined there were sufficient similarities between the employees’ factual allegations and employment settings, and similar circumstances with regard to JMJ’s defenses. Judge Biggs therefore allowed the FLSA collective action to proceed.

Implications For Employers

The ruling in Wade details the burden employers must meet to decertify a FLSA collective action and also the burden for employees to certify a class action in the Fourth Circuit. This is yet another case which details the importance of employers’ obligations to abide by all record-keeping and paperwork requirements in their respective jurisdictions.

October 4, 2023 by Gerald L. Maatman, Jr.

Alabama Federal Court Rejects ADA Lawsuit By The EEOC In Part Because Requiring Employees To Stop Taking Prescription Medications Is Not An Adverse Employment Action Under The ADA

By Gerald L. Maatman, Jr., Derek Franklin, and Emilee N. Crowther

Duane Morris Takeaways: In EEOC v. Army Sustainment, LLC, No. 1:20-CV-234 (M.D. Ala. Sept. 26, 2023), Judge R. Austin Huffaker, Jr. of the U.S. District Court for the Middle District of Alabama granted in part and denied in part Defendant’s Motion for Summary Judgment. The Court dismissed the EEOC’s “failure-to-accommodate” and “screening-out” claims against Defendant, in addition to holding that only four of the EEOC’s seventeen claimants could support the EEOC’s disability bias claim. The Court also found that the Defendant employer’s policy barring employees from taking various prescribed medications was not, by itself, an adverse employment action. For employers facing EEOC-initiated lawsuits involving ADA claims alleging discrimination and failure-to-accommodate, this decision is instructive in terms of what evidence courts are apt to consider in determining whether an employee suffered an adverse employment action, as well as what is required to trigger an employer’s duty to provide a reasonable accommodation.

Case Background

Defendant Army Sustainment LLC a/k/a Army Fleet Support (“AFS”) is a helicopter maintenance contractor which, from 2003 to 2018, employed aircraft mechanicals, technicians, and other aviation specialists at Fort Novosel (previously known as Fort Rucker). Id. at 1. AFS implemented a drug testing policy (the “Policy”) in 2012 requiring employees in “safety-sensitive positions” to submit to drug testing for opioids, amphetamines, and benzodiazepines. Id. Individuals who were legally prescribed these medications were cleared to work so long as they agreed not to take their medication within 6-to-8 hours before their shift. Id. at 1-2.

In 2016, AFS eliminated the “6-to-8-hour rule,” and instead required employees to undergo a medical evaluation “to determine whether an employee’s prescription medication was appropriate for use during work hours.” Id. at 2. As part of the medical evaluation, the employee’s original prescribing doctor was asked “whether the employee was stable on their safety-sensitive medication or whether alternative medications were available that were as effective.” Id. If no alternative medications were available, and the employee was determined unable to safely work while taking the medication, the employee was deemed “disabled.” Id.

In 2016, two AFS employees affected by the Policy filed discrimination charges with the EEOC. The Commission found reasonable cause that AFS violated the ADA by “not allowing a class of individuals ‘to continue to work or return to work while taking their disability-related medications.’” Id. at 2-3. Further, the EEOC held that AFS’ Policy itself had “the effect of discrimination on the basis of disability” and violated the ADA. Id. at 3.

The EEOC filed suit against AFS on behalf of 17 AFS employees who suffered from different disabilities, but were legally prescribed medications and required to undergo medical evaluations to return to work. Id. The EEOC brought four claims against AFS, including: (1) Discrimination on the Basis of Disability; (2) Failure to Accommodate; (3) Impermissible Qualification Standard; and (4) Interference. Id.

The Court’s Decision

Timeliness Of The EEOC’s Enforcement Action

In Alabama, an employee bringing claims under Section 706 of Title VII “must file a charge with the EEOC within 180 days of the date of the alleged discrimination.” Id. at 4. Any claims filed with the EEOC after the 180-day period are time-barred. Id. AFS asserted that eight of the 17 claimants were time-barred, as their claims arose more than 180 days before the “representative charge” was filed with the EEOC. Id.

The Court found that Section 706(e)(1) precluded the EEOC “from pursuing claims that arose outside the charging period, even when those untimely claims are related to otherwise timely claims.” Id. at 5. While the parties disagreed as to what date the “representative charge” was filed with the EEOC, the Court held that any claims that arose prior to May 23, 2016 (180 days before one of the representative charges were filed), were time-barred. Id. at 6. As such, the Court dismissed seven of the claimants from the EEOC’s lawsuit. Id.

Whether Prohibiting Use Of A Medication Can Constitute An Adverse Employment Action

The Court’s first step in analyzing the EEOC’s disability discrimination claim was determining whether the claimants with timely claims experienced adverse employment actions. The Court rejected the EEOC’s argument that requiring the claimants to stop using their prescription medications was an adverse action, and held that merely being required to stop using certain prescription medications, without more, did not have a tangible adverse effect on employment of the claimants. Id. at 23. In making this determination, the Court explained that “[w]hether the employer’s conduct constitutes an actionable adverse employment action under the ADA is determined by whether a reasonable person in the plaintiff’s position would view the employment action in question as adverse.” Id. at 23.

The Court noted that while AFS required the claimants to sign a document acknowledging that their medications were “inappropriate for use in a safety sensitive work environment” and could result in discipline for employees if caught taking the medications, the Court held that “neither signing a form nor fear of termination are sufficient to constitute an adverse employment action.” Id. at 24.

The Court’s Rejection Of Unpaid Leave As A Reasonable Accommodation

The Court also considered whether AFS, as a means of providing a disability accommodation, could place employees on unpaid leave until they either received medical clearance to return to work or agreed to stop taking their medications. Id. at 25.

The Court rejected the notion that temporary leave is an accommodation rather than an adverse action. It reasoned that AFS “unilaterally forced the claimants on unpaid leave and did so without an accommodation request by the claimants or without any showing that the claimants could not actually perform their job duties either with or without their prescription medications.” Id. at 27. Thus, the Court denied summary judgment as to the claims of four AFS employees who alleged they suffered an adverse employment action after being placed on unpaid leave, and granted summary judgment in favor of AFS as to the remaining employees on this claim. Id. at 28.

Summary Judgment Universally Granted On Claims of Failure-To-Accommodate And Screening Out Employees Under The ADA

The Court further held that AFS was entitled to summary judgment against all claimants based on their failure to establish a prima facie case for the EEOC’s failure-to-accommodate claim. Id. at 37. For example, the Court found the EEOC did not show that two of the claimants made accommodation requests to AFS or how any such requests would accommodate the limitations presented by their disabilities. Id. at 36.

The Court’s penultimate holding concerned the EEOC’s claim that AFS’s drug policy constituted an impermissible qualification standard in violation of Sections 12112(b)(3) and 12112(b)(6) of the ADA by screening out qualified individuals with a disability. Id. 41-42. The Court granted summary judgment as to all claimants on the screening-out claim based on the EEOC’s failure to support its claim with statistical evidence or by showing that any of the claimants were actually terminated and “screened out” from their jobs. Id.

Finally, the Court refused to consider or grant summary judgment on the EEOC’s interference claim because AFS failed to acknowledge it as a standalone cause of action and thus did not formally move for summary judgment on that claim. Id. at 44-45.

Implications For Employers

Employers confronted with EEOC-initiated litigation involving restrictions on employee conduct outside the workplace should take note that the Court relied heavily on its assessment of whether “a reasonable person” in the claimants’ position would view the restriction in question as adverse. Further, from a practical standpoint, the Court’s refusal to grant summary judgment on the EEOC’s failure-to-accommodate claims illustrates the potential risk of trying to use unpaid leave as an attempted means of reasonably accommodating an employee’s disability.

October 3, 2023 by Gerald L. Maatman, Jr.

In The Latest Application of the Sixth Circuit’s Novel “Strong Likelihood” Standard, Ohio District Court Denies Plaintiffs’ Motion to Issue Notice of FLSA Overtime Lawsuit

By Gerald L. Maatman, Jr., Jennifer A. Riley, and Kathryn Brown

Duane Morris Takeaways: On September 27, 2023, District Court Judge Charles E. Fleming in Woods et al. v. First Transit, Inc., et al., 21-cv-739 (N.D. Ohio Sept. 27, 2023) denied plaintiffs’ motion for court-authorized notice of bus drivers’ claims of alleged unpaid overtime wages under the Fair Labor Standards Act (FLSA). The district court applied the Sixth Circuit’s newly-minted standard to conclude the plaintiffs failed to demonstrate a “strong likelihood” exists that they are similarly situated in relevant respects to other employees of the defendant transportation company. The court’s rejection of the plaintiffs’ “self-serving declarations” and consideration of the defendants’ competing evidence illustrates how the Sixth Circuit’s new standard is a game changer for FLSA litigants in Ohio, Michigan, Tennessee and Kentucky.

Case Background

On April 6, 2021, three named plaintiffs filed a class and collective action lawsuit asserting claims of unpaid overtime in violation of the FLSA and Ohio, California and New York state laws. The plaintiffs alleged that the defendant failed to pay overtime wages to fixed-route bus drivers for work performed before and after their shifts. The plaintiffs also alleged the defendant deducted 30 minutes’ worth of time from their pay for unpaid meal breaks even when they did not receive uninterrupted break time. After the district granted the defendant’s partial motion to dismiss the New York and California state law claims, only the Ohio state law claims survived. Additionally, only two named plaintiffs remained after one of the named plaintiff s was shown never to have worked as a fixed-route bus driver.

Two individuals filed consents to join the lawsuit as opt-in plaintiffs in October 2021 and a third joined the lawsuit in February 2022.

After approximately six months of fact discovery solely on the issue of conditional certification, the named plaintiffs moved for conditional certification of their claims under the FLSA on June 29, 2022. If granted, the plaintiffs would have authority to issue notice to a collective including any person who drove a fixed bus route for the defendant in any week during the prior three years.

In support of their motion, the plaintiffs submitted sworn declarations of the two named plaintiffs and three putative opt-in plaintiffs, job descriptions, an employee handbook and a user guide for time entry. In opposition to the motion, the defendant submitted sworn declarations of managers at the locations at which the named or opt-in plaintiffs had worked, declarations of corporate human resources and payroll staff and collective bargaining agreements governing fixed-route bus drivers at various locations.

After the parties fully briefed the motion, the district court deferred ruling on the motion until the Sixth Circuit Court of Appeals issued its anticipated decision on the standard for conditional certification in FLSA cases.

On May 19, 2023, the Sixth Circuit in Clark v. A&L Homecare and Training Center, LLC, 68 F.4th 1003 (6th Cir. 2023), announced a new standard for determining whether FLSA plaintiffs may issue court-sanctioned notice to other employees. Rejecting the prior standard in which a plaintiff need only make a “modest factual showing” to win court-authorized notice, the Sixth Circuit held that plaintiffs must put forth sufficient evidence to demonstrate a “strong likelihood” exists that they are similarly situated to other employees. Factors relevant to the analysis include whether the potential other plaintiffs performed the same tasks and were subject to the same timekeeping and pay policies as the named plaintiffs. After Clark, the parties submitted supplemental briefs arguing how the new standard applied to the plaintiffs’ pending motion.

The Court’s Decision

Upon weighing the parties’ competing evidence, the district court answered “no” to the question whether a strong likelihood exists that the named plaintiffs experienced the same policies of unpaid overtime wages as other employees of the defendant.

The district court concluded that the plaintiffs did not introduce any evidence of a “company-wide policy” binding on all fixed-route bus drivers that potentially violates the FLSA. The court stated that the only evidence of the alleged unlawful overtime pay practices came in the form of “self-serving declarations” of doubtful credibility. For example, an opt-in plaintiff declared that she worked as a fixed-route bus driver until December 2020. However, the manager who oversaw the opt-in plaintiff’s location declared that no driver at that location drove a fixed bus route. The court reasoned no “strong likelihood” exists that the opt-in plaintiff is similarly situated to the named plaintiffs given that the opt-in plaintiff could not be in the proposed collective of fixed-route bus drivers.

The court also considered the evidence of written policies regarding meal breaks, or the lack thereof, for fixed-route bus drivers. Contrary to the plaintiffs’ allegation of company-wide automatic pay deductions for meal break time, the manager of the location at which one of the named plaintiffs had worked declared that drivers at that location did not even receive meal breaks.

The collective bargaining agreements in evidence showed that different locations of work had different policies governing time entry and breaks for fixed-route bus drivers. For example, a collective bargaining agreement for one location stated that the defendant paid drivers for 15 minutes of time prior to their route to perform pre-shift work. A collective bargaining agreement for another location said the defendant paid drivers 20 minutes for pre-shift work.

In sum, the court reasoned that the evidence revealed dissimilarity in policies and practices concerning compensation for the company’s fixed-route bus drivers. Because the evidence showed employees were subject to different policies concerning key issues such as how they report time, how schedules are set, what period of time is compensable, whether they receive a meal break and how meal breaks are paid, the court concluded the plaintiffs did not satisfy the “strong likelihood” standard announced in Clark to obtain court-authorized notice of their FLSA claims.

Implications For Employers

The district court’s ruling in Woods leaves no doubt that FLSA plaintiffs in the Sixth Circuit face a heightened evidentiary burden to obtain court-authorized notice in the wake of the Sixth Circuit’s new standard in Clark. The district court clarified that the “strong likelihood” standard in Clark is an evidentiary standard, not a pleading standard. The court’s analysis in Woods shows defendants have a genuine opportunity to present evidence to attack the plaintiffs’ efforts to show a common policy of FLSA-violating conduct and thereby block notice to other employees who may expand the scope of the lawsuit exponentially. Employers with operations in the Sixth Circuit ought to use Clark as an opportunity to look anew at their wage and hour policies and practices to guard against the risk of costly and time-consuming FLSA litigation.