Epstein Becker Green Persuades California Court to Deny Certification of Misclassification, Meal Period, and Rest Period Claims Against Restaurant Client
After more than five years of litigation, a Los Angeles Superior Court has denied a motion for certification of a class action against Epstein Becker Green client Joe's Crab Shack Restaurants on claims that its managers were misclassified as exempt and denied meal and rest periods in violation of California law. The Epstein Becker Green team, which was led by Michael S. Kun, argued on behalf of the defendant that the plaintiffs' claims could not be certified for class treatment because, among other things, individualized inquiries would need to be conducted because managers' experiences differ from restaurant to restaurant, position to position, and day to day.
In denying the plaintiffs' class certification motion, Judge Charles Palmer found that the plaintiffs had not established adequacy of class representatives, typicality, commonality, or superiority. In addition, Judge Palmer noted that handling this case as a class action would require every individual member to prove whether or not he or she spent more than half his or her time on exempt managerial tasks, which would be time-consuming and burdensome for the court. This ruling also emphasized a defendant's due process right to provide individualized defenses to class members' claims.
Epstein Becker Green Is Victorious in Persuading a Federal Court to Dismiss a Class and Collective Action Alleging Worker Misclassification
On September 16, 2014, Judge Jesse Furman of the U.S. District Court for the Southern District of New York handed down a major victory for Epstein Becker Green and its client Corporate Transportation Group in the case Saleem and Singh v. Corporate Transportation Group, a class and collective action brought two years ago under the Fair Labor Standards Act (FLSA) and New York Labor Law (NYLL), alleging that defendants, black car companies in New York City, had for years misclassified approximately 1,500 drivers as independent contractors. Plaintiffs sought reclassification as employees and seven-figure amounts of damages in this “bet the company” case.
Epstein Becker Green defeated plaintiffs’ motion for class certification in November 2013 and, in January and February 2014, filed a motion for summary judgment on behalf of defendants and opposed a competing motion for summary judgment brought by plaintiffs. On September 16, 2014, Judge Furman concluded that plaintiffs were properly classified as independent contractors rather than employees for the purposes of both the FLSA and the NYLL.
Member of the Firm Evan J. Spelfogel and Associate Margaret C. Thering led the Epstein Becker Green team, along with Associate Dustin E. Stark.
Epstein Becker Green Assists Two Health Insurers in Defeating Data Breach Class Certification
After more than five years of litigation, on April 26, 2016, a three-judge Superior Court panel in Pennsylvania upheld the denial of a motion for certification of a class action against Epstein Becker Green clients Keystone Mercy and AmeriHealth Caritas Health Plans.
In December 2010, the plaintiff, on behalf of his daughter, filed a lawsuit against the two insurers, claiming that they violated state consumer protection laws by losing a flash drive containing the personal health information (PHI) of more than 283,000 individuals and by failing to live up to their promise to protect and safeguard these individuals’ PHI.
In denying the plaintiff’s class certification motion, the panel found that the trial court had “carefully considered the numerosity, typicality, adequacy of representation, and fair and efficient method of adjudication requirements for class certification under Rule 1702 [('Prerequisites to a Class Action')] and found the class action requirements were not met.” In addition, the panel agreed with the trial court’s ruling that the plaintiff could not properly represent potential class members because he was unable to conclusively link his daughter to the PHI contained on the lost flash drive. Also, the panel left in place the trial court’s finding that, as there was no there was no actual harm associated with the data breach, the plaintiff failed to fulfill the typicality requirements for a class action.
The Epstein Becker Green team was led by Stuart M. Gerson and included Patricia M. Wagner and Tanya Vanderbilt Cramer.
Epstein Becker Green Secures Favorable Settlement in Class Action Case
Epstein Becker Green recently concluded a favorable class action settlement for a leading in-flight Internet service provider.
In 2014, the client was sued in a putative class action in the Eastern District of New York. The claims against the client centered on its monthly subscription, pursuant to which its customers are afforded access to the Internet on all flights equipped with the client’s devices and agree to have their credit cards charged each month until they take steps to cancel the service. The complaint alleged that the client did not sufficiently apprise customers of the recurring nature of the charge, and sought restitution, requesting nearly $24 million in charges on behalf of the class.
After the judge denied the client’s motion for stay or dismissal in favor of arbitration, Epstein Becker Green appealed the case to the U.S. Court of Appeals for the Second Circuit. In response, the judge set a hearing for class certification two months hence. In the face of both the likely success of the appeal and extensive discovery demands that we served on the class certification issue, plaintiffs’ counsel requested that the matter be stayed so that the parties could conduct a formal mediation. After two days of meditation, a settlement was brokered in which the client offered promotional codes to affected class members to settle the action. Because so-called “coupon settlements” warrant higher scrutiny under the Class Action Fairness Act and current case law, the court required three hearings for approval, including the submission of expert reports on the particular sophistication of the client’s customers. Final approval was granted in April 2016, the time for appeal has expired, and the settlement is now final.
The Epstein Becker Green team included Newark attorneys Anthony J. Laura, Robert M. Travisano, and Yael Spiewak and New York attorneys Scarlett L. Freeman and Matthew Savage Aibel.
Epstein Becker Green Obtains Dismissal of Statewide Representative Suit Brought Against California Client
In December 2016, Epstein Becker Green obtained the dismissal of a statewide representative action against a California employer. The plaintiff had alleged that our client did not pay several thousand California employees for all time worked, denied them meal and rest periods, and gave them inaccurate wage statements.
The suit was brought under California’s Private Attorneys General Act (“PAGA”), which allows employees to file representative actions—similar to class actions—on behalf of all “aggrieved employees.” Epstein Becker Green filed a motion to dismiss the statewide claims on a variety of procedural and substantive grounds.
After reviewing Epstein Becker Green’s motion to dismiss, plaintiff’s counsel conceded that the motion would be granted and agreed to dismiss all of the statewide representative claims. The plaintiff will now be proceeding with individual claims only, which we believe he is required to arbitrate.
The Epstein Becker Green team included Michael S. Kun and Amy B. Messigian.