“Picking Off” Plaintiffs in FLSA Collective Actions: Genesis HealthCare Corp. v. Symczyk

Earlier this month in Genesis Healthcare Corp. v. Symczyk, 133 S. Ct. 1523 (2013), the U.S. Supreme Court held that it is permissible for defendants to “pick off” plaintiffs in FLSA collective actions. In jurisdictions that hold that an unaccepted offer of judgment fully satisfies and renders moot a plaintiff’s individual claim, a defendant can moot a collective action brought under the FLSA by simply tendering the named plaintiff a Federal Rule of Civil Procedure 68 offer of judgment.

In 2009, plaintiff Laura Symczyk filed a complaint on behalf of herself and “all other persons similarly situated” alleging that her former employer, defendant Genesis Healthcare, violated the FLSA by automatically deducting 30 minutes of time worked for meal breaks for certain employees although the employees performed compensable work during those breaks. Defendant answered the complaint and simultaneously served upon plaintiff an offer of judgment under Rule 68. Plaintiff did not accept the offer. Defendant then filed a motion to dismiss for lack of subject-matter jurisdiction. Defendant argued that because it offered plaintiff complete relief on her individual damages claim, she no longer possessed a personal stake in the outcome of the suit, rendering the action moot. The District Court agreed, noting that no other plaintiff had yet joined the action, and dismissed the lawsuit. The Third Circuit Court of Appeals reversed, holding that plaintiff’s collective action was not moot because allowing defendants to “pick off” named plaintiffs with strategic Rule 68 offers before conditional certification could short circuit the process, and, thereby, frustrate the goals of collective actions.

The Supreme Court reversed the Third Circuit and held that “the mere presence of collective-action allegations in the complaint cannot save the suit from mootness once the individual claim is satisfied.” Id. at 1529. In so holding, the Court distinguished cases in which it held that a class action is not rendered moot when the named plaintiff’s individual claim becomes moot. The Court stated that while “a putative class acquires an independent legal status once it is certified under Rule 23” in a FLSA collective action, “‘conditional certification’ does not produce a class with an independent legal status, or join additional parties to the action” Id. at 1530.

The Court’s holding is a boon to employers facing FLSA collective actions in circuits that have held that an unaccepted Rule 68 offer that provides complete relief is sufficient to render an individual plaintiff’s claim moot because it offers a quick and easy way to dispose of potentially major and costly class-like litigation.

 

Topics:  Collective Actions, FLSA, Genesis HealthCare, Genesis Healthcare Corp. v. Symczyk, Mootness, Rule 23, SCOTUS

Published In: Civil Procedure Updates, Constitutional Law 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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