California is bringing Comcast home—last week, California employers were the beneficiary of some down-home wisdom coming out of San Francisco.
Giving some sage advice to the wage and hour community, Judge Alsup in Lou et. al. v. Ma Laboratories, Inc., denied conditional and class certification to a broad class of Ma Labs workers under the FLSA and Rule 23. The Court looked at last year’s Supreme Court decision in Comcast Corp. v. Behrend (see our analysis here) and asked what seems like it should be a simple question: can I try all of these plaintiffs’ claims in one case? The answer: where plaintiffs have not presented common proof of liability or a method of determining classwide damages, Comcast means no certification.
In its ruling, the Court considered whether certification was suitable in a case alleging, among other things, unpaid off-the-clock work by Ma Labs’ employees. Plaintiffs presented expert testimony of Dr. Richard Drogin—a repeat player for plaintiffs seeking class certification—who proposed individualized calculations for each class member based on an analysis of time clock, telephone, and email records of a small number of putative class members. The parties also presented declarations with conflicting testimony as to whether work was performed off the clock, whether overtime was paid or approved, and what employees were told with respect to payment of overtime.
The Court held that the “collective variations” in declarations submitted by the parties “cause plaintiffs’ off-the-clock claims to necessarily dissolve into mini-trials,” making certification inappropriate. The Court also found that Dr. Drogin’s proposed calculations were not a proper method of determining classwide damages because there was no indication his sampling was actual proof of off-the-clock work or that it was representative of the proposed class.
A few additional gems stem from this ruling:
- Proposing one broad class, when there are different policies in place during the class period (here, employees’ exempt status changed and new time clock interfaces were implemented) means plaintiffs are unlikely to meet a required showing of predominance and commonality for Rule 23; and
- Plaintiffs’ counsel cannot concurrently serve as class counsel in more than one class case against the same defendant. Don’t forget: adequacy of counsel is always an element of class certification.
In the end, while it denied plaintiffs’ motion, the Court left open the possibility of eventual first step FLSA collective certification with new counsel. But, the Court cautioned that since it had already determined classwide proof made it impossible for a Rule 23 class to proceed, there will likely be “similarities in problems of classwide proof at step two” of FLSA certification.
Employers can learn from this decision the importance of gathering declarations early in the process of defending a class or collective action—showing differing experiences amongst putative class members has the potential to defeat Rule 23 certification and get the court thinking early on about the impropriety of eventual FLSA collective certification.
We also hope that the Court’s guidance will serve as a caution to plaintiffs’ counsel that simply making broad allegations of unpaid work is not enough to garner class certification. Classwide proof of liability, as well as a method of determining damages on a classwide basis that is tied to the theory of liability must be proven, not speculated at with expert statistical analysis or anecdotal experiences.