Court Denies Conditional Certification of Proposed Class of Retail Representatives

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[author: Greg Mersol]

We’ve written several times in the past about the two-step procedure now in vogue for the handling certification of collective actions under section 16(b) of the FLSA. Under that procedure, a plaintiff first moves for “conditional certification,” which, despite its name, means only that the court is authorizing notice to the potential class members, and then permitting them to opt into the action if they choose within a particular time. Once that time has concluded, the court permits discovery as to that group and the defendant then moves to “decertify” the class, even though it was never really certified to begin with.

The two-step procedure was intended to deal with the unique features of FLSA litigation, but has taken on a life of its own. Apparently forgetting the legislative history of FLSA section 16(b), which was intended to limit aggregated claims against employers, and glossing over the management problems inherent in these types of cases, some courts are readily issuing conditional certification orders even when it is obvious that the proposed class will never stand up over time. Further, although many courts have commented on the misnomers used throughout the process, such terms as “conditional certification” remain even though it is generally agreed that at that stage the court is certifying nothing.

A recent case from the Eastern District of Pennsylvania reflects a court’s common sense, rational approach to these issues. In Postiglione v. Crossmark, Inc.pdfCase No. 11-960 (E.D. Pa. Nov. 14, 2012), the plaintiffs were a group of “retail representatives” for a retail service company known as Crossmark. Crossmark had 12,000 such representatives, who provided merchandising and inventory services to retailers nationwide. These representatives were paid on an hourly basis, but claimed they were not compensated for certain administrative time (such as responding to email or computer data entry), some driving time, and, on occasion, working time due to budget pressures.

The plaintiffs took what is now a fairly common approach, filing a complaint naming 31 initial plaintiffs, and then collecting an additional 21 opt-in plaintiffs along the way. Following some early procedural wrangling and a period of limited discovery, they then moved for conditional certification.

The District Court noted the two-step procedure and, like other courts, noted problems in the nomenclature for various steps. At its core, however, the court recognized that the two-step procedure was simply a case management tool. Applying the standard that the plaintiffs must make a “modest factual showing” that the class members are similarly situated, the court ultimately denied the motion.

To begin with, the court found that the plaintiffs’ evidentiary submissions were suspect. Although the plaintiffs submitted numerous declarations, those declarations departed from their deposition testimony in important respects and tended to exaggerate their claims. Beyond that, the plaintiffs each testified about different “unwritten policies” and had different accounts of what time they were actually paid for. The court concluded that “Plaintiffs have not demonstrated the existence of a nationwide policy; they have only demonstrated the lack of any such common policy.”

Interestingly, the court also concluded that the 52 named plaintiffs had not been properly joined under Federal Civil Rule 20. It found that FLSA section 16(b)’s similarly situated standard was less stringer than that of Rule 20, and that since there was no collective class, there also could not be Rule 20 joinder. It therefore dismissed all of the claims, except for that of the first named plaintiff, without prejudice.

The Bottom Line: Another court has denied conditional certification after finding that the plaintiffs had not made the modest factual showing of having similarly situated class members.

 

Topics:  Class Action, Class Certification, FLSA, Retail Market

Published In: Administrative Agency Updates, Civil Procedure Updates, Labor & Employment Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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