By Justin Donoho, Gerald L. Maatman, Jr., and Tyler Zmick
Duane Morris Takeaways: In Short v. MV Transportation, Inc., No. 24-CV-3019 (N.D. Ill. Mar. 10, 2025), Judge Manish S. Shah of the U.S. District Court for the Northern District of Illinois denied defendant’s bid to dismiss a claim brought under the Illinois Genetic Information Privacy Act (“GIPA”). In his ruling, Judge Shah acknowledged that U.S. Department of Transportation regulations require companies in the transportation industry (including defendant) to ensure their drivers satisfy certain physical qualification criteria. The Court nonetheless rejected defendant’s argument that the regulations preempt the GIPA because they do not specifically require employers to ask applicants about their family medical histories (which the GIPA prohibits). In other words, the Court denied defendant’s motion to dismiss because the GIPA does not make it “physically impossible” to comply with federal regulations.
Background
Plaintiff Kevin Short alleged that he applied for a position as a driver for Defendant MV Transportation, Inc., a company that provides paratransit services. As part of the application process, Plaintiff was required to complete a physical examination during which he was asked about his family medical history, including whether his family members had a history of high blood pressure, heart disease, or diabetes.
Plaintiff subsequently sued MV Transportation under the GIPA, alleging that the company violated Section 25(c)(1) of the statute by “solicit[ing], request[ing], [or] requir[ing] . . . genetic information of a person or a family member of the person . . . as a condition of employment [or] preemployment application.” 410 ILCS 513/25(c)(1).
MV Transportation moved to dismiss the complaint on the basis that the Department of Transportation’s (“DOT”) regulations preempted Plaintiff’s GIPA claim. Specifically, MV Transportation argued that Plaintiff’s claim was barred under a “conflict preemption” theory because allowing the claim to proceed would force MV Transportation to choose between complying with the GIPA or complying with federal requirements to “conduct[ ] thorough physical examinations of its drivers.”
MV Transportation pointed to the Motor Carrier Safety Act for support, under which the DOT regulates commercial motor vehicle safety by promulgating “minimum safety standards” to ensure that “the physical condition of operators . . . is adequate to enable them to operate the vehicles safely” – including by requiring drivers to satisfy 13 “physical qualification criteria.” 49 U.S.C. § 31136(a)(3).
The Court’s Decision
In denying MV Transportation’s motion, the Court noted that conflict preemption applies only where “compliance with both federal and state regulations is a physical impossibility” or where the state law “stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.” Id. at 6-7 (citations omitted); see also id. at 6 (noting that “‘[i]nvoking some brooding federal interest’ is insufficient to establish preemption; instead, MV Transportation must identify ‘a constitutional text or a federal statute’ that displaces or conflicts with the state law”) (quoting Virginia Uranium, Inc. v. Warren, 587 U.S. 761, 767 (2019)). The Court further observed that MV Transportation had the burden of overcoming the “presumption against preemption.”
In its ruling, the Court concluded that it is not physically impossible for MV Transportation to simultaneously comply with the GIPA and DOT regulations relative to Plaintiff’s pre-employment health screening because the DOT regulations do not specifically require any inquiry into a driver’s family medical history. MV Transportation asserted that DOT regulations nonetheless “contemplate[] that medical examiners may discuss” a person’s family medical history during a physical exam. The Court was not persuaded, however, stating that such a scenario is “not enough to suggest that compliance with GIPA and the federal regulations is ‘physically impossible.’” Id. at 9 (“The mere possibility that a medical examiner asks for information protected by GIPA while performing an examination does not demonstrate impossibility to comply with both federal and state law.”).
The Court similarly held that the GIPA is not an obstacle to the execution of Congress’s purposes, as reflected in the Motor Carrier Safety Act and DOT regulations. As support for this conclusion, the Court observed that the relevant DOL regulations and the GIPA serve different purposes – the regulations are meant to promote the safe operation of commercial motor vehicles, while the GIPA focuses on health information privacy.
Implications Of The Decision
Short v. MV Transportation is one of several recent decisions in which courts denied bids to dismiss GIPA claims at the pleading stage.
Given this litigation landscape and the statute’s strict penalty provision – under which statutory damages can quickly become significant ($2,500 per negligent violation and $15,000 per intentional or reckless violation, see 410 ILCS 513/40(a)(1)-(2)) – employers should ensure they comply with the statute regarding any health screenings they ask applicants or employees to complete (including by explicitly advising applicants and employees not to disclose their family medical histories during the screenings).
Duane Morris Takeaway:This week’s episode of the Class Action Weekly Wire features Duane Morris partner Jerry Maatman, senior associate Alessandra Mungioli, and associate Ryan Garippo with their discussion of the key trends analyzed in the 2025 edition of the Consumer Fraud Class Action Review.
Bookmark or download the Consumer Fraud Class Action Review e-book here, which is fully searchable and accessible from any device.
Jerry Maatman: Welcome listeners. Thank you for being here for our weekly podcast series, the Class Action Weekly Wire. I’m Jerry Maatman, a partner at Duane Morris, and joining me today are my colleagues, Ryan and Alessandra. Thanks so much for being on the podcast today.
Alessandra Mungioli: Thank you, Jerry, happy to be part of the podcast.
Ryan Garippo: Thanks, Jerry. Glad to be here.
Jerry: So, today we are discussing the recent publication of the second edition of the Duane Morris Consumer Fraud Class Action Review. Listeners can find that book in e-book form on our blog, the Duane Morris Class Action Defense Blog. Alessandra, can you tell our listeners a little bit about the publication and desk reference?
Alessandra: Absolutely, Jerry. Class action litigation in the consumer fraud space remains an area of key focus for skilled class action litigators in the plaintiffs’ bar. As a result, compliance with consumer fraud laws and the myriad of ways that companies, customers, and third parties interact is a corporate imperative. To that end, the class action team here at Duane Morris is pleased to present the Consumer Fraud Class Action Review for 2025. This publication analyzes the key consumer fraud-related rulings and developments from 2024, and the significant legal decisions and trends impacting this type of class action litigation for 2025. We hope that companies will benefit from this resource in their compliance with these ever-evolving laws and standards.
Jerry: For those using a scorecard, in 2024 there was a mixed bag of results which led to major victories for both plaintiffs and defendants in this space. Ryan, what were some of the key takeaways from the publication in regard to litigation in this particular area?
Ryan: Well, Jerry, like many areas, obtaining class certification is still one of the most effective procedural tools to vindicate the rights of consumers. In 2024, plaintiffs were successful in receiving class certification in 57% of the motions that were filed, which was down from the number in 2023 when courts granted 66% of those motions.
Jerry: Well, that overall number and the tracking of the statistics is certainly telling and interesting. What would you anticipate 2025 will bring for companies that are facing consumer fraud class actions?
Ryan: Well, as the class action landscape continues to develop so, too, are the playbooks for the plaintiffs and defense bars. Counsel on both sides are becoming more sophisticated and creative in their approaches to prosecuting and defending class actions. There’s a wide variety of conducts that gives rise to consumer fraud class actions in every industry susceptible, so at least in 2024, consumer fraud class actions ran the gamut of false advertising and false labeling claims from everything to cannabis to nuts. So, we anticipate this is continue going to continue to be the case in 2025.
Jerry: Well, the plaintiffs’ bar is nothing if not innovative. I had a data breach incident that came across my desk last night that involved allegations under the Illinois Consumer Fraud Act. So, the plaintiffs’ bar is pushing the envelope for sure in this particular space. In terms of companies that are trying to comply with consumer fraud statutes, the Review also talks about the top consumer fraud settlements in 2024. How did plaintiffs do in securing settlement funds this past year?
Alessandra: They did very well in securing high dollar settlements. In 2024, the top 10 consumer fraud settlements totaled a staggering $2.4 billion. However, although this is a huge dollar amount, it was a significant difference since 2023, when the top 10 consumer fraud class action settlements totaled $3.29 billion dollars. But really, this just shows the massive amount of money involved in some of these class actions where thousands to millions of consumers could potentially be involved.
Jerry: Well, gosh, the stakes are quite high then, and we’ll continue to track those settlement numbers in 2025. If you just look at your iPhone and scroll through things like Twitter, you see plaintiffs’ bar advertising and then publicizing these big settlements. So, it may well be this year is another record-breaking year when it comes to settlement amounts. Well, thanks so much for being here today, and thank you to our loyal listeners for tuning in. Please stop by our blog and download a free copy of the Consumer Fraud Class Action Review e-book.
Ryan: Thanks, Jerry, for having me, and thanks to all the listeners.
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 Takeaways: On February 24, 2025, in CSU Board of Governors v. Alderman, Case No. 23-SC-565, 2025 CO 9 (Colo. Feb. 24, 2025), the Colorado Supreme Court reversed the Court of Appeals in finding that an unjust enrichment class claim over COVID-19 tuition reimbursement may proceed even though it contained the same subject matter in which a breach of contract claim was dismissed. As a result, a plaintiff cannot properly state a claim for unjust enrichment if an enforceable contract covers the same subject matter as those claims.
Case Background
In April 2020, Renee Alderman (“Alderman”) filed a putative class action against Colorado State University (“CSU”) in state court, accusing the university of taking tuition and student fees and failing to refund the tuition and fees, when the university was closed for six-weeks due to the pandemic in Spring of 2020, and thus breaching their contract or in the alternative, enriching itself with student money. 2025 CO 9, at 3.
Alderman argued that CSU had a contractual obligation to provide “live, in person classroom instruction in a physical classroom” and “access to on-campus athletic events, on-campus computers and technology, and other in-person events” in exchange for student payments inclusive of tuition and fees. Id. at 6. However, CSU noted that it offered “fully online distance-learning programs” which were priced differently than in-person classes in Fort Collins. As such, CSU moved to dismiss Alderman’s complaint under 12(b)(5) – failure to state a claim, citing it had authority to temporarily cease operations under C.R.S. § 23-30-111, which covers exigent circumstances such as in the event of “the prevalence of fatal diseases of other unforeseen calamity.” Id. at 7.
Ultimately, the district court agreed with CSU and dismissed the case in agreeing with the language of C.R.S. § 23-30-111, stating there was no breach because the statute allows for temporary suspensions such as that of Spring 2020. The district court also dismissed the unjust enrichment claim based upon the same statute and contract, concluding it covered the same subject matter. Id. at 8.
Alderman appealed both rulings. The Colorado Court of Appeals (“COA”) upheld the dismissal of the breach of contract claims but reversed the district court’s ruling on the unjust enrichment claim. The COA emphasized that “the contract obligations were obviated when it invoked the statute,” leaving Plaintiffs with no enforcement rights because the statute made her contract claims unenforceable. Id. at 13. CSU then petitioned the Colorado Supreme Court on her unjust enrichment claim in July 2023, which the Supreme Court accepted.
The Supreme Court’s Decision
The Colorado Supreme Court focused on whether an unjust enrichment claim can be properly asserted when it mirrors a contract that: (1) covers the same subject matter; and (2) remains legally enforceable.
The focus on unjust enrichment was determinative a “quasi-contract or contract implied-in-law that does not depend on a promise or privity between the parties,” but when an unjust enrichment claim and breach of contract involve the same subject matter, it is “mutually exclusive.” Id. at 18. The Supreme Court emphasized that this means “a party may not assert a claim for unjust enrichment is a valid contract covers the same subject matter,” which also holds true even if a party is unable to recover under the contract. Id. at 18-19.
Yet, there are two exceptions to this rule for unjust enrichment and same subject matter of a breach of contract: (1) when the express contract fails or (2) the claim covers matters which are outside (or arose after) the contract. Id.
The Supreme Court held that breach of contract and unjust enrichment claim involved the same subject matter (i.e., tuition and fees for educational services). Id. at 19. It reasoned that the COA conflated the “breach of contract claim with the failure of the contract itself,” meaning that even though Alderman’s inability to prove CSU breached the contract by temporarily suspending in-person operations did not render the whole contract void or unenforceable. Id. In sum, all other contractual rights existed between both Alderman and CSU.
Ultimately, the Supreme Court ruled that Alderman’s unjust enrichment arguments merely serves as “gap-filler provision to provide a remedy” where a contract is silent about her “desired term” is not grounded in case law or principle; thus, Alderman’s approach for the Court to expand its reach of unjust enrichment jurisprudence is unfounded. Id. at 21. For these reasons, the Supreme Court opined that Alderman’s unjust enrichment claims fail as a matter of law.
Implications Of The Ruling
The Colorado Supreme Court’s ruling underscores the importance evaluating all claims raised by plaintiffs in both breach of contract and equity principles (such as unjust enrichment) to ensure those claims rise from the same subject matter to ultimate defeat the same claim raised through different legal theories at the outset of a lawsuit.
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., Anna Sheridan, George J. Schaller
Duane Morris Takeaways: In EEOC v. Battleground Restaurants, Inc. et al., 1:24-CV-792, 2025 U.S. Dist. LEXIS 32071 (M.D.N.C. Feb. 24, 2025), the Court denied Defendants’ motion to dismiss an EEOC lawsuit alleging discriminatory hiring practices against men at a chain of sports bars. The EEOC’s complaint asserts sex discrimination in hiring for server, bartender, and host positions, and for failures to preserve employment records in violation of Title VII of the Civil Rights Act of 1964.
This case signals a new wave of anti-discrimination enforcement actions against companies that prioritize hiring practices that may exclude male applicants. The Commission’s litigation efforts are in full swing, and companies must review their hiring practices to ensure all applicants are weighed neutrally during the application process.
Complaint Allegations
The EEOC’s complaint alleges that between December 1, 2019, and February 18, 2022, Kickback Jack’s restaurants located throughout North Carolina, Virginia, and Tennessee discriminated against males by failing to hire men for front of house, non-managerial positions. Id. at *1. Kickback Jack’s is owned and operated by Battleground Restaurants, Inc. and Battleground Restaurant Group, Inc. (“BRGI”) (collectively “Defendants”). Id.
Kickback Jack’s employs “servers, hosts, and bartenders in non-managerial front-of-house positions,” all of which require no “special skills or qualifications.” Id. at *2. Kickback Jack’s advertisements state that applicants need only “[b]ring [their] great attitude to work and [Kickback Jack’s] will train you.” Id. at *2.
The underlying charge was filed on July 31, 2020, when a female server, Melody Roe, filed an EEOC charge of discrimination against Kickback Jack’s. Id. Included in Roe’s charge of discrimination was statements that Kickback Jack’s “has a policy and/or practice of only hiring females for front of house positions and not into management.” Id. at *3. The EEOC’s investigation into Roe’s charge of discrimination found that Battleground Restaurants, Inc. “maintained a policy or practice . . . of failing or refusing to hire males for non-managerial front of house positions because of their sex.” Id.
The Commission’s investigation further revealed that of the 2,100 non-managerial front-of-house employees employed between December 1, 2019, and February 18, 2022, “approximately 3% were male” and some Kickback Jack’s locations “did not employ male servers at all.” Id. at *4.
As a result of these newly uncovered hiring practices, the EEOC filed a complaint asserting that “a predominantly female front-of-house workforce cannot be justified by any legitimate business purposes” and that Defendants’ hiring practices “were and are intentional and willful.” Id. The Complaint also alleged that Defendants failed to make and preserve records relevant to their employment practices, and specifically failed to retain applications for employment. Id. at *5.
Defendants moved to dismiss the EEOC’s complaint, dismiss or strike BRGI, and requested the Court certify the case for interlocutory appeal. Id. at *1.
District Court’s Ruling
The Court denied the Defendants’ motion in all aspects on the basis that the EEOC complied with procedural and administrative requirements, plausibly alleged a pattern or practice of disparate sex discrimination, and that the EEOC could properly include BRGI as a defendant. Id.
Defendants argued the EEOC failed to provide them with adequate notice of its claims on “behalf of male applicants and the Title VII records violations.” Id. at *5. Defendants did not dispute that it received notice of Roe’s charge of discrimination within 10 days (as required by 42 U.S.C. § 2000e-5(b)). Rather, the Defendants argued the charge of discrimination did not “give them notice of an EEOC investigation into discrimination against males in hiring.” Id. at *7.
The EEOC countered that the investigation into discrimination against males was implicit in Roe’s allegations that the restaurant had “a policy and/or practice of only hiring females” for front of house positions. Id.The Court agreed that the “alleged discrimination against males for front of house positions appears on the face of the charge of discrimination,” Defendants did not allege that they were not on notice of the charge of discrimination, and therefore, the EEOC complied with its administrative and procedural requirements under the statute. Id. at *8
The Court also denied Defendants’ motion to dismiss the EEOC’s preservation of records claim because no 10-day notice requirement exists under the statutory provisions. Id. at *8-9. The Court further disagreed with Defendants that the EEOC’s claims should be limited to 180 days before Defendants received notice of the charge of discrimination because “the complaint [did] not contain the facts necessary to assess whether the EEOC’s claims exceed Title VII’s statute of limitations period.” Id. at *10-11.
On Defendants’ argument to dismiss or strike BRGI, the Court opined that the Commission plausibly alleged BRGI is “essentially, Kickback Jack’s operator.” Id. at *12. The Court held the EEOC can sue BRGI “despite not naming [BRGI] directly as a party in the charge of discrimination or communicating with it based on both the joint enterprise test and substantial identity exception.” Id. at *15.
On the EEOC’s allegations of Title VII sex discrimination in hiring, the Court denied the Defendants’ motion to dismiss because the EEOC “plausibly alleged a pattern or practice of discrimination by using statistics” which demonstrated of the 2,100 non-managerial front-of-house employees approximately only 3% were male. Id. at *18. And in some instances, locations “did not employ any male servers at all.” Id. The EEOC also satisfied its pleading requirements under Title VII as it alleged Defendants discriminated “against male applicants –– a protected class — ” and alleged that “male applicants qualified” for the front-of-house roles.” Id. *17-18. Based on these findings, the Court reasoned “this type of ‘gross disparity’ plausibly demonstrates an inference of discrimination against males who applied to work as servers.” Id. at *18. Therefore, the Court found that the EEOC has met its burden of plausibly alleging the elements of its claim sufficiently to survive a motion to dismiss.
The Court also denied Defendants’ request for certification stating it did “not find any esoteric issues meriting an interlocutory appeal.” Id. at *2.
Implications For Employers
Employers’ hiring practices remain a target for EEOC initiated litigation. This case is but one example of the EEOC bringing a lawsuit after identifying a pattern of potentially discriminatory practices first alleged in a charge. While uncommon, the EEOC does regularly bring these “pattern-or-practice” lawsuits under Section 706 or Section 707 of Title VII of the Civil Rights Act of 1964 when it has a case that draws significant public interest or could make an industry-wide impact.
This is far from the first case of male gender discrimination in the restaurant industry. The popular restaurant chain Hooters has settled several similar lawsuits, one in 1997 for $3.75 million, and one in 2009 for an undisclosed sum. See Latuga v. Hooters, Inc., 1:93-CV-7709 (N.D. Ill. Nov. 25, 1997); see also Grushevski v. Texas Wings, Inc., No. 09-CV-00002 (S.D. Tex. Apr. 16, 2009). Lawry’s restaurants were also hit with an EEOC pattern or practice lawsuit in 2006 alleging that Lawry’s practice of only hiring females for its server positions constituted gender discrimination. See EEOC v. Lawry’s Restaurants, Inc., No. CV 06-01963 (C.D. Cal. Mar. 31, 2006).
The recent case against Battleground shows that the EEOC continues to closely scrutinize hiring practices which select individuals based on a protected characteristic, including gender. Employers must also monitor and audit their hiring practice outcomes to ensure statistical models don’t demonstrate discrimination otherwise an EEOC action may be on the horizon.
By Gerald L. Maatman, Jr., and Christian J. Palacios
Duane Morris Takeaways: On February 18, 2025, in EEOC v. LeoPalace, Case No.: 1:25-CV-00004 (D. Guam), the EEOC settled a lawsuit and entered into a three-year consent decree with LeoPalace Resort, a large hotel in Guam. Under the terms of the agreement, LeoPalace agreed to pay over $1.4 million and hire an external equal employment monitor to settle allegations that it provided employees of non-Japanese national origin with less favorable wages, benefits, and other terms of employment than their Japanese counterparts. This lawsuit is significant because it is the first seven figure settlement that the Commission has procured since President Trump took office in January 2025 and it is accompanied by a statement from the new Acting Chair Andrea Lucas announcing the Commission’s new enforcement agenda and its intent to protect all workers from national origin discrimination and “Anti-American” bias.
The LeoPalace Settlement And Anti-American Bias Enforcement
On February 14, 2025 the EEOC filed suit against LeoPalace in the U.S. District Court for the District of Guam, on behalf of non-Japanese employees Christopher Adams, Thomas Lee and Donald Gueniot Jr., alleging that the hotel subjected these workers to less favorable wages and benefits, and other terms and conditions of employment compared to equivalent or subordinate Japanese employees on the basis of their national origin (non-Japanese), in violation of Title VII of the Civil Rights Act. Id. at 1. The Commission settled with LeoPlace shortly thereafter, resulting in the hotel chain agreeing to pay $1,412,500.00 and further agreeing to a three-year external equal opportunity monitor to oversee compliance and training, as well as reinstate former employees interested in going back to work for LeoPalace. Id. at 9.
In the accompanying press release, Acting Chair Andrea Lucas announced, ““Federal anti-discrimination laws ensure equal employment opportunity for jobs performed by all workers regardless of national origin. The President’s Executive Order on Ending Illegal Discrimination and Restoring Merit-Based Opportunity recognizes that the longstanding federal civil rights laws serve as a bedrock to support equality of opportunity for all Americans. This case is an important reminder that unlawful national origin discrimination includes discrimination against American workers in favor of foreign workers.” See EEOC Newsroom, LeoPalace Resort to Pay Over $1.4 Million in EEOC National Origin Discrimination Lawsuit (Feb. 18, 2025). This is the Commission’s first publicized settlement since Lucas was appointed Acting Chair of the EEOC on January 21, 2025.
One day after the settlement was announced, the EEOC published a second press release on its Newsroom “putting employers and other covered entities on notice” that the Commission was committed to protecting all workers from unlawful national origin discrimination, including American workers. See EEOC Newsroom, EEOC Acting Chair Vows to Protect American Workers from Anti-American Bias (Feb. 19, 2025). The Commission further explained that, although Title VII’s national origin nondiscrimination requirement generally meant that employers could not prefer American workers, it also meant that employers could not prefer non-American workers, or otherwise disfavor Americans. Id. It concluded its press release by stating that while employers may have “many excuses” for preferring non-American workers (including lower labor cost, client preference, or a biased perception that foreign workers have a better work ethic than Americans), none of these were legally permissible reasons to violate Title VII. Id.
Takeaway for Employers
Every new presidential administration brings with it an array of objectives focused on different policy priorities. Since President Trump took office, he has taken unique steps to reshape the Commission by firing its Chair, two Commissioners, and its general counsel, all within the course of a few weeks. The Commission has already indicated it is committed to carrying out President Trump’s policy agenda, consistent with his executive orders related to “unlawful DEI-motivated race and sex discrimination,” “defending the biological and binary reality of sex and related rights,” “protecting workers from religious bias and harassment, including antisemitism” and, as the above settlement illustrates, “anti-American national origin discrimination.” See EEOC Newsroom, President Appoints Andrea R. Lucas EEOC Acting Chair (Jan. 21, 2025).
Employers should take note of the EEOC’s new policy priorities and can likely expect increased enforcement activity in each of these areas for the next four years.
Duane Morris Takeaways: Legal compliance to prevent discrimination is a corporate imperative. Companies and business executives operate in the court of public opinion and workplace inequality continues to grab headlines and remains forefront in the public eye. In this environment, employers can expect discrimination class actions to reach even greater heights in 2024. To that end, the class action team at Duane Morris is pleased to present the second edition of the Discrimination Class Action Review – 2025. This publication analyzes the key discrimination-related rulings and developments in 2024 and the significant legal decisions and trends impacting discrimination class action litigation for 2025. We hope that companies and employers will benefit from this resource in their compliance with these evolving laws and standards.
Class action litigation in the discrimination space remains an area of key focus of skilled class action litigators in the plaintiffs’ bar. Class actions challenging employment policies and practices has a robust history since passage of the Civil Rights Act of 1964. For decades, federal courts routinely granted class certification in nationwide employment discrimination class actions, which often spiked settlements that entailed huge pay-outs and across-the-board changes to HR systems. In turn, significant changes in the workplaces of Corporate America resulted from class action precedents, massive settlements, and injunctive relief orders. This changed in large part over a decade ago when the U.S. Supreme Court decided Wal-Mart Inc. v. Dukes, et al., 564 U.S. 338 (2011). That decision reversed a class certification order in a pay and promotions lawsuit involving 1.5 million class members who asserted claims of sex discrimination in pay and promotions. In handing down this ruling, the Supreme Court tightened the legal requirements for securing class certifications. It simultaneously forced the plaintiffs’ bar to adjust their strategies on how to prosecute class actions, while also fueling new defense strategies for opposing class certification motions. Suddenly gone were the days when nationwide class actions challenging hiring, compensation, and promotion policies of large corporations inevitably ended with across the board certification orders and big settlement checks.
But the pendulum appears to be swinging back, as courts are becoming increasingly inclined to find for plaintiffs in class certification rulings, and thereby raising the potential for large monetary remedies. This is especially true in the discrimination context, as society continues to grapple with widespread inequality in the wake of large scale social justice campaigns like Black Lives Matter and the #MeToo movement. Businesses are being confronted with increasingly employee-friendly legislative changes and a more aggressive plaintiffs’ bar.
Click here to bookmark or download a copy of the Discrimination Class Action Review – 2025 e-book. Look forward to an episode on the Review coming soon on the Class Action Weekly Wire!
