An employee might complain of retaliation if they face negative consequences after raising a workplace concern or complaint. A retaliation lawsuit might cost you a lot of money in the form of penalties, settlements, and legal fees. Use the following tips to avoid retaliation complaints from your employees.
Keep Complainants’ Identities Confidential
Some of your supervisors or managers might retaliate against an employee who paints them in a bad light. For example, an employee who complains about racial jokes in the cafeteria might face retaliatory actions from the relevant supervisor.
A good way to avoid such retaliation is to keep the employee’s identity confidential. Investigate the complaint and take appropriate action without mentioning the person responsible for the original complaint.
Keep Communication Channels Open
Let your employees know that you are accessible and that they can reach you with any information. Keeping the channels of communication open is especially useful for victims of alleged retaliation. Help the employees understand the company’s anti-retaliation policy. Encourage the alleged victims to report any negative experiences they might have in the workplace.
Explain Disciplinary Actions
Employees who face disciplinary actions sometimes claim retaliation even where retaliation doesn’t exist. Such a complaint is especially likely if an employee faces genuine disciplinary action soon after making a complaint.
In such a case, you don’t have to abandon your disciplinary policy. Rather, go the extra mile to explain to the employee why you are disciplining them. Show any documentary evidence you might have for the employee’s actions.
Watch Out for Red Flags
Some victims of retaliation might not speak up. Some people prefer to handle things on their own. Others might not speak up for fear of worsening their situations. However, retaliation is bad whether someone reports it or not.
Therefore, you should always be on the lookout for signs of retaliation in your workplace. You should be especially keen after an action that might trigger retaliation. For example, pay attention to your workplace when an employee complains about a manager or supervisor. Telltale signs of retaliation include:
- Increased scrutiny of a complainant
- Inconsistent documentation of employee conduct
- Inconsistent review of employees
Don’t jump to conclusions if you suspect something amiss. Investigate further before taking action.
Take Action If Retaliation Occurs
Employers who look the other way when retaliation occurs in their workplace encourage the vice. Take relevant action if an employee complains of retaliation. Taking action may include:
- Preserving evidence, such as emails or documents, related to the complaint
- Conducting an internal investigation
- Warning or disciplining the perpetrators as the circumstances demand
- Consulting legal counsel if necessary
Taking action will also encourage future victims to speak up.
Establish a Clear Anti-Retaliation Policy
Every company should have an anti-retaliation policy from its conception. Establish such a policy as soon as possible if you don’t have one. Your policy should have:
- A definition of what constitutes retaliation
- Actions to take (such as who to inform) on suspicion of retaliation
- Red flags that might constitute retaliation
Review and update the policy as necessary. Ensure your policy is consistent with relevant employment laws.
Provide Relevant Training
Your anti-retaliation policy might not help much if your employees don’t understand it. The people in charge, especially managers and supervisors, should especially understand how to avoid retaliation or its appearance. Provide training, for example, in the form of workshops to ensure everyone understands your anti-retaliation policy.
The above tips should help you avoid retaliation complaints. However, you have to deal with all retaliation complaints, whether they are genuine or not. Contact Mohajerian Law Corp if an employee has raised a retaliation complaint. We will review your case, advise you, and help you defend your rights.
Ward v. Tilly’s, Inc.
Court of Appeal of California, Second Appellate District, Division Three
February 4, 2019, Opinion Filed
Case No B280151
31 Cal. App. 5th 1167 *; 243 Cal. Rptr. 3d 461 **; 2019 Cal. App. LEXIS 95 ***; 2019 WL 421743
HN7 Overtime & Work Periods
Industrial Welfare Commission Wage Order No. 7-2001 (Cal. Code Regs., tit. 8, § 11070) requires reporting time pay if an employee is required to report for work and does report, but is not put to work or is furnished less than half said employee’s usual or scheduled day’s work. § 11070, subd. 5(A). In other words, an employee is owed reporting time pay only if upon reporting for work, she is denied the opportunity to work.
Business & Corporate Compliance > … > Wage & Hour Laws > Scope & Definitions > Overtime & Work Periods
HN8 Overtime & Work Periods
Employers do not trigger reporting time pay requirements merely by expecting employees to apprise themselves of their schedules. It goes without saying that an employee cannot arrive at work on time without knowing when his or her shift begins.
The Labor Code Private Attorneys General Act (PAGA) authorizes aggrieved employees to file lawsuits to recover civil penalties on behalf of themselves, other employees, and the State of California for Labor Code violations. PAGA cases must follow the requirements specified in Labor Code Sections 2698 – 2699.5. SB 836 became effective on June 27, 2016. It made important changes in PAGA requirements. These requirements apply prospectively to all pending PAGA cases as well as new ones.
- All new PAGA claim notices must be filed online, with a copy sent by certified mail to the employer.
- All employer cure notices or other responses to a PAGA claim must be filed online, with a copy sent by certified mail to the aggrieved employee or aggrieved employee’s representative.
- A filing fee of $75 is required for a new PAGA claim notice and any initial employer response [cure or other response] to a new PAGA claim notice.
- The filing fee may be waived if the party on whose behalf the notice or response is filed is entitled to in forma pauperis status.
- The time for the Labor and Workforce Development Agency (LWDA) to review a notice under Labor Code § 2699.3(a) has been extended from 30 to 60 days.
- When filing a new PAGA lawsuit in court, a filed-stamped copy of the complaint must be provided to LWDA. (Applies only to cases in which the initial PAGA claim notice was filed on or after July 1, 2016.)
- Any settlement of a PAGA action must be approved by the court, whether or not the settlement includes an award of PAGA penalties.
- A copy of a proposed settlement must be provided to LWDA at the same time that it is submitted to the court.
- A copy of the court’s judgment and any other order that awards or denies PAGA penalties must be provided to LWDA.
All items that are required to be provided to the LWDA must be submitted online. All PAGA related notices and documents are no longer required to be submitted to LWDA by certified mail.
MOHAJERIAN LAWYERS REPRESENT EMPLOYERS THROUGHOUT CALIFORNIA
The Defend Trade Secrets Act of 2016 (“DTSA”), enacted on May 11, 2016, represents the significant trade secret reform legislation in years. The DTSA amends the Economic Espionage Act of 1996, providing for federal criminal penalties for foreign economic espionage and trade secret theft and adds new federal civil trade secret protections. The Act creates a new cause of action which became effective immediately – for trade secret misappropriation. The Federal Courts take jurisdiction and provide remedies. The plaintiff has a choice of Federal or State remedies. There is whistleblower protection and employment contracts require disclosure about the whistleblower protection and immunity provisions in employee contract “that governs the use of a trade secret or other confidential information” that is “entered into or updated after” May 11, 2016. The failure to provide notice will bar exemplary damages or attorney fees against an employee who did not receive notice.
- Bauer Bros., LLC v. Nike, Inc.. __F.Supp.3d___2016 WL 411065 (SDCA 2016).
The Bauer company, owner registered trademarks for apparel, including t-shirts, filed suit against Nike claiming unfair competition under Lanham Act and California law, and common law trademark infringement in the federal district court in the Southern District of California. Nike attacking the suit on all fours.
As to consumer confusion, Nike contended that there was no likelihood of confusion among consumers. Nike also requested that the Court grant summary adjudication as to Bauer’s lack of actual damages resulting from the alleged trademark infringement. Nike contended that “even if Bauer could overcome Nike’s fair use defense, its claims still fail as a matter of law because, based on the undisputed evidence, no reasonable juror could find a likelihood of confusion between Nike and Bauer’s products.” Specifically, Nike contended that there is no likelihood of consumer confusion because:
[Plaintiff’s] marks are conceptually and commercially weak and are thus entitled to little, if any, protection; (2) [Plaintiff’s] and Nike’s goods are dissimiliar; (3) [Plaintiff’s] and Nike’s marketplace uses are dissimiliar; (4) after years of purported concurrent use, no evidence of actual confusion exists; (5) the parties’ marketing channels are dissimilar; (6) Nike’s consumers are sophisticated and exercise a high degree of care; (7) Nike acted in good faith in adopting its use of the trademark; and (8) [Plaintiff] had not provided any evidence of an intention to expand any existing product line.
In response, the Plaintiff contended that there was, at a minimum, a triable issue as to likelihood of confusion because both parties’ trademarks are on the exact same products – t-shirts. Plaintiff further contended that it “produced evidence that some of its customers purchased Plaintiff’s products to wear at World Cup Soccer games. In addition, Plaintiff contended that its trademarks are arbitrary or fanciful when applied to its products and are, therefore, entitled to a high level of protection. Plaintiff then argued that the marks used by Nike have perfect similarity in sight and sound to Plaintiff’s marks. Plaintiff contends that it presented evidence of actual reverse confusion and submitted a likelihood of confusion survey by a professor.
After applying the Ninth Circuit court’s eight point test (i.e., the Sleekcraft factors) to this case, the court concluded that genuine issues of disputed fact remain with regard to a finding of likelihood of consumer confusion. See Fortune Dynamic Inc., 618 F.3d at 1031 (“We are far from certain that consumers were likely to be confused as to the source… but we are confident that the question is close enough that it should be answered as a matter of fact by a jury, not as a matter of law by a court.”) (quoting Entrepreneur Media, Inc., 279 F.3d at 1140). Therefore, the summary judgment motion brought by Nike on the issue of likelihood of confusion was denied.
By Al Mohajerian | Published April 16, 2016 | Posted in Uncategorized | Tagged Bauer Bros., Bauer company, Inc.. __F.Supp.3d___2016, likelihood of confusion, LLC v. Nike, mohajerian, mohajerianlaw, Nike claiming unfair competition under Lanham Act |
Lawsuits often allege that a class of employees performed work off-the-clock, and that the employees are not only entitled to compensation for that time, but to a slew of penalties that often dwarf the amount of alleged damages.
Depending on the nature of an employer’s business, a plaintiff might allege that employees were not paid for the couple minutes it might take to “boot up” a computer in the morning, or for waiting to punch in their time cards. Or a plaintiff might contend that an employer has a time-rounding policy that somehow shortchanges employees by a minute or two of pay each day.
In defending these cases, employers often argue that not only must individualized inquiries be conducted to determine whether, when and how long an employee allegedly worked off-the-clock, but whether the employee was engaged in personal activities during some or all of that time. Those are issues that go to whether a class should be certified.
On the merits, employers often argue that such time is non-compensable in any event as de minimis time – time that is so small that it need not be compensated.
The de minimis doctrine has been recognized by the United States Supreme Court for decades, and a variety of decisions have held that as much as 10 minutes per day is de minimis, non-compensable time.
AL MOHAJERIAN – MOHAJERIAN APLC
Following the Supreme Court’s class action rulings in Wal-Mart Stores, Inc. v. Dukes and Comcast Corp. v. Behrend, lower courts continued to grapple with significant class action issues. One discernible trend during the past few years has been increased appellate scrutiny of the entire class action mechanism.
In 2014, both state and federal appellate courts issued significant rulings interpreting the Supreme Court’s landmark decisions in Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541 (2011), and Comcast Corp. v. Behrend, 133 S. Ct. 1426 (2013).
In Dukes, the Supreme Court unanimously rejected the use of statistical sampling and extrapolation to circumvent resolution of individualized inquiries in a class trial. The plaintiffs in Dukes proposed, and the Ninth Circuit endorsed, a procedure in which “[a] sample set of the class members would be selected,” and the “percentage of claims determined to be valid would then be applied to the entire remaining class . . . without further individualized proceedings.” 131 S. Ct. at 2561. The Supreme Court “disapprove[d]” this “novel project” of “Trial by Formula,” and held that, because the Rules Enabling Act “forbids interpreting Rule 23 to ‘abridge, enlarge or modify any substantive right, . . . a class cannot be certified on the premise that [a defendant] will not be entitled to litigate its statutory defenses to individual claims.” Id.(quoting 28 U.S.C. § 2072(b)).
Although the Court premised its rejection of “Trial by Formula” on the Rules Enabling Act, the use of statistical sampling and extrapolation to eliminate the class action defendant’s right to present individualized defenses also raises serious due process concerns. Those concerns were placed before the California and Pennsylvania Supreme Courts in 2014–and those courts came to very different conclusions.
The California Supreme Court squarely held that a “Trial By Formula” approach raises due process concerns. In Duran v. U.S. Bank National Association, 59 Cal. 4th 1 (2014), employees claimed they were improperly denied overtime compensation. The court overturned a $15 million verdict that was the product of a trial that adjudicated claims of a 21-person sample set, and the results were extrapolated to the remaining class members. In doing so, the court unanimously concluded that the trial court’s “decision to extrapolate classwide liability from a small sample, and its refusal to permit any inquiries or evidence about the work habits of [employees] outside the sample group,” impermissibly “deprived” U.S. Bank of its right to litigate its defenses to liability. Id. at 35.
Echoing Dukes, the California Supreme Court explained that “the class action procedural device may not be used to abridge a party’s substantive rights,” and thus “a class action trial management plan may not foreclose the litigation of relevant affirmative defenses, even when these defenses turn on individual questions.” Id. at 34. Significantly, the court grounded its holding in “both class action rules and principles of due process.” Id. at 35. While the court declined to resolve definitively “whether or when sampling should be available as a tool for proving liability in a class action,” it instructed that “any class action trial plan, including those involving statistical methods of proof, must allow the defendant to litigate its affirmative defenses.” Id. at 40.
- California appellate courts have denied class certification alleging rest and meal period violations in cases where common proof of the alleged violations is lacking
The following case involves both misclassification as well as rest and meal period “violations”, the latter of which pertains to our case. Abstract statements of what a sampling may “prove”, absent any actual substantive proof, is insufficient to certify a class.
In Dailey v. Sears, Roebuck and Co., 214 Cal.App.4th 974 (2013, the California Court of Appeal held the trial court did not abuse its discretion when it denied class certification in a case alleging Sears misclassified as exempt auto center managers and assistant managers. Plaintiff alleged Sears misclassified as exempt auto center managers and store managers when they should have been classified as non-exempt because, according to plaintiff, policies and practices common to all of them effectively required them to regularly spend more than 50 percent of their time performing nonexempt work, and because they did not regularly exercise discretion and independent judgment at Sears.
Based on that theory, plaintiff alleged that Sears was required to pay its auto center managers and assistant managers overtime wages and to provide to them the same rest periods and meal periods to which non-exempt employees are entitled. The trial court denied plaintiff’s motion for class certification and granted Sears’ motion to preclude class certification on the following grounds: (1) individual issues predominate over issues common to the proposed class, (2) it would not be impracticable for each manager or assistant manager to litigate his or her claim(s) individually, and (3) the plaintiff class representative would not be an adequate class representative on account of alleged resume fraud on his part.
On appeal, the court held the trial court did not abuse its discretion by crediting Sears’ evidence over plaintiff’s evidence. Sears successfully argued to the trial court and on appeal that wide variations existed between how each manager and assistant manager allocated their working time and that each managerial employee had substantial discretion in how they managed each store. The trial court held that this variation from manager to manager and from store to store made it impractical to try the case as a class action and denied certification finding that individual issues predominated over common issues. Notably, the Court of Appeal reiterated that a trial court determining whether to certify a class “must determine ‘whether the elements necessary to establish liability are susceptible to common proof,’” and held the trial court did not abuse its discretion when it ruled the plaintiff failed to meet his burden of showing that the alleged misclassification could be established by common proof. page 1 / 2
The court of appeal rejected plaintiff’s contention that the trial court failed to sufficiently consider the proposed statistical sampling methodology proposed by plaintiff’s expert witness to prove both liability and damages. The court explained plaintiff failed to identify any legal authority that a court has “deemed a mere proposal for statistical sampling to be an adequate evidentiary substitute for demonstrating the requisite commonality, or suggested that statistical sampling may be used to manufacture predominate common issues where the factual record indicates that none exist.”
In other words, plaintiff “asked the trial court to certify the class based on little more than abstract statements about what statistical sampling might be able to establish,” which the court held is not sufficient.
The Court of Appeal affirmed the trial court’s denial of class certification of the plaintiff’s rest period and meal period claims. The court held the plaintiff failed to present substantial evidence “that Sears employed any policy or routine practice to deprive proposed class members of ‘off-duty’ meal and rest breaks and, accordingly, [plaintiff] failed to show that this allegation could be proved on a classwide basis” by common proof.
If the parties’ evidence on a motion for class certification is conflicting on the issue of whether common or individual questions predominate, the trial court is permitted to credit one party’s evidence over the other’s in determining whether the requirements for class certification have been met, and doing so is not an improper evaluation of the merits of the case. Cal. Civ. Proc. Code § 382.
This decision by the court of appeal shows a growing reluctance by California courts to certify for class treatment cases alleging rest and meal period violations in cases where common proof of the alleged violations is lacking.
AL MOHAJERIAN – MOHAJERIAN APLC
In anticipation of Plaintiffs attempting to submit to the court a small number of employees who will claim to have suffered violations of wage and hour law, the defense should rely to a great extent upon the case of Duran v. U.S. Bank, decided in 2014 by the California Supreme Court, 59 Cal.4th 1 (2014), as well as other supporting case law which prohibits “biased” sampling to prove liability. The case of Duran v. U.S. Bank is summarized below.
In 2014, the California Supreme Court unanimously upheld an intermediate appeals ruling that struck down a $15 million judgment in a class action case against U.S. Bank. The court reversed an employee class action win, finding that the Alameda County trial judge mismanaged a wage and hour class action where the court relied on flawed statistical sampling by relying on testimony of just 20 employees in extrapolating damages that had a 43 percent margin of error. The class involved 260 current and former business banking officers who claimed they were misclassified as exempt.
Writing for a unanimous court, Justice Carol Corrigan criticized the trial court’s flawed reliance on statistics:
As even the plaintiffs recognize, this result cannot stand. The judgment must be reversed because the trial court’s flawed implementation of sampling prevented USB from showing that some class members were exempt and entitled to no recovery. A trial plan that relies on statistical sampling must be developed with expert input and must afford the defendant an opportunity to impeach the model or otherwise show its liability is reduced. Statistical sampling may provide an appropriate means of proving liability and damages in some wage and hour class actions. However, as outlined below, the trial court‘s particular approach to sampling here was profoundly flawed.
The court further noted, “[s]tatistical sampling may provide an appropriate means of proving liability and damages in some wage and hour class actions,” but “after a class has been certified, the court’s obligation to manage individual issues does not disappear.” 59 Cal.4th 1 (2014)
The decision is critically important in highlighting the challenge by the trial court certifying class actions, particularly in the misclassification context, and the obligation of the court in determining not just whether common questions exist, but also whether it will be feasible to try the case as a class action. Duran makes clear that class certification is not appropriate, unless these individual questions can be managed with an appropriate trial plan. Thus, depending on the nature of the claimed exemption and the facts of a particular case, a misclassification claim has the potential to raise numerous individual questions that may be difficult, or even impossible, to litigate on a classwide basis.
The California Supreme Court in Duran highlighted the challenges in certifying class actions, particularly as related to calculation of damages at trial. The well-reasoned decision makes it more challenging to certify a class, as the court called on trial judges to consider whether a class action is manageable and can withstand a trial – at the class certification stage. The court criticized the trial court’s reliance on flawed statistical sampling, as a substitute in determining damages at trial, and noted:
After certifying a class of 260 plaintiffs, the trial court devised a plan to determine the extent of USB’s liability to all class members by extrapolating from a random sample. In the first phase of trial, the court heard testimony about the work habits of 21 plaintiffs. USB was not permitted to introduce evidence about the work habits of any plaintiff outside this sample. Nevertheless, based on testimony from the small sample group, the trial court found that the entire class had been misclassified. After the second phase of trial, which focused on testimony from statisticians, the court extrapolated the average amount of overtime reported by the sample group to the class as a whole, resulting in a verdict of approximately $15 million and an average recovery of over $57,000 per person.
The court explained that in marshaling through these types of cases, the trial court must consider the issue of “manageability,” separate and apart from whether common questions predominate, to determine whether it is possible to litigate on a classwide basis:
Although predominance of common issues is often a major factor in a certification analysis, it is not the only consideration. In certifying a class action, the court must also conclude that litigation of individual issues, including those arising from affirmative defenses, can be managed fairly and efficiently. In wage and hour cases where a party seeks class certification based on allegations that the employer consistently imposed a uniform policy or de facto practice on class members, the party must still demonstrate that the illegal effects of this conduct can be proven efficiently and manageably within a class setting. (Brinker, at p. 1033; Dailey v. Sears, Roebuck & Co. (2013) 214 Cal.App.4th 974, 989.)
Trial courts must pay careful attention to manageability when deciding whether to certify a class action. In considering whether a class action is a superior device for resolving a controversy, the manageability of individual issues is just as important as the existence of common questions uniting the proposed class.
The court also cautioned that reliance on a single policy cannot circumvent the aforementioned requirements, to justify certification. It took note of U.S. Bank’s well-written policies and noted that class certification is more likely to be appropriate in cases where the job is highly standardized, and if the corporate policy uniformly requires overtime work, noting that “[w]here standardized job duties or other policies result in employees uniformly spending most of their time on nonexempt work, class treatment may be appropriate even if the case involves an exemption that typically entails fact-specific individual inquiries.” However, the court explained that the employer’s “blanket” classification of a group of employees as exempt is not sufficient to justify certification of a class based on common questions.
The court acknowledged that the way to defeat certification remains by demonstrating that individual issues will swamp the common ones: USB’s exemption defense raised a host of individual issues. While common issues among class members may have been sufficient to satisfy the predominance prong for certification, the trial court also had to determine that these individual issues could be effectively managed in the ensuing litigation. (See Brinker, supra, 53 Cal.4th at p. 1054 (conc. opn. of Werdegar, J.); Sav-On, supra, 34 Cal.4th at p. 334.) Here, the certification order was necessarily provisional in that it was subject to development of a trial plan that would manage the individual issues surrounding the outside salesperson exemption.
In general, when a trial plan incorporates representative testimony and random sampling, a preliminary assessment should be done to determine the level of variability in the class. If the variability is too great, individual issues are more likely to swamp common ones and render the class action unmanageable. No such assessment was done here. With no sensitivity to variability in the class, the court forced the case through trial with a flawed statistical plan that did not manage but instead ignored individual issues.
Notably, the court stated that if a court does not find that the class is manageable through a uniform trial plan at the certification stage, then the certification is reversed:
Although courts enjoy great latitude in structuring trials, and we have encouraged the use of innovative procedures, any trial must allow for the litigation of affirmative defenses, even in a class action case where the defense touches upon individual issues. As we will explain, the trial plan here unreasonably prevented USB from supporting its affirmative defense. Accordingly, the class judgment must be reversed. The trial court is of course free to entertain a new certification motion on remand, but if it decides to proceed with a class action it must apply the guidelines set out here.
The trial court could not abridge USB’s presentation of an exemption defense simply because that defense was cumbersome to litigate in a class action. Under Code of Civil Procedure section 382, just as under the federal rules, “a class cannot be certified on the premise that [the defendant] will not be entitled to litigate its statutory defenses to individual claims.” (Wal-Mart Stores, Inc. v. Dukes (2011) 564 U.S. __, __ [131 S.Ct. 2541, 2561].) These principles derive from both class action rules and principles of due process. (See Lindsey v. Normet (1972) 405 U.S. 56, 66; Philip Morris USA v. Williams (2007) 549 U.S. 346, 353.
- Duran prohibits “cherry picking” or biased selection of a “sample”
A sample must be randomly selected for its results to be fairly extrapolated to the entire class. A random sample is one in which each member of the population has an equal probability of being selected for inclusion in the sample. Even when selection procedures appear to be random, errors may arise that undermine randomness. Nonresponse bias can occur if a sample is chosen randomly from a group containing only survey respondents. The potential for bias arises because those who do not respond have no probability of inclusion in the sample. Thus, although the participants are randomly selected from among respondents, the sample will not reflect the characteristics of members of the population who chose not to respond to the survey. Duran, 59 Cal.4th 1 (2014)
Selection bias occurs when members of the population are chosen based on a nonrandom criterion or are selectively included or excluded from the sample group. In litigation, selection bias can occur when members of the population are allowed to opt out of the class. If plaintiffs with high-value claims opt out, the sample will be skewed toward low value claims and may result in an unfairly low estimate of damages. Conversely, if the opt-outs represent mainly low-value claims or plaintiffs with no valid claim, the sample results will be unfairly inflated. Self-interest may motivate class members to act in ways that will maximize the class award. Thus, one must always suspect that any nonrandom method of picking sample cases will be skewed and therefore will be an inaccurate estimate of the population average. Selection bias can also occur if named plaintiffs are included in the sample based not on random selection but on their status in the litigation. Class counsel are entitled to select named plaintiffs in a manner that enhances their position. However, that tactical choice should not compromise the statistical approach required for random sampling. Duran, 59 Cal.4th 1 (2014)
A sample that includes even a small number of interested parties can produce biased results. The impact of this error is magnified when the biased results are extrapolated to the entire population. Selection bias cannot be cured simply by increasing the size of the sample. When a selection procedure is biased, taking a large sample does not help. This just repeats the basic mistake on a larger scale. A sample that is representative of a population when first drawn may become less so over time. In class action litigation, such changes can occur with opt-outs or other events that change the class composition. Attention must be paid to possible changes that could render a previously representative sample unrepresentative. When that occurs, sampling will not accurately reflect what needs to be known about a population. Duran, 59 Cal.4th 1 (2014).
AL MOHAJERIAN – MOHAJERIAN APLC
To summarize, California courts have long viewed class actions as a means whereby claims of many individuals can be resolved at the same time.
“Section 382 of the Code of Civil Procedure authorizes class suits in California when ‘the question is one of a common or general interest, of many persons, or when the parties are numerous, and it is impracticable to bring them all before the court.’
“Class certification requires proof (1) of a sufficiently numerous, ascertainable class, (2) of a well-defined community of interest, and (3) that certification will provide substantial benefits to litigants and the courts, i.e., that proceeding as a class is superior to other methods.”
“The ‘community of interest’ requirement embodies three factors: (1) predominant common questions of law or fact; (2) class representatives with claims or defenses typical of the class; and (3) class representatives who can adequately represent the class.”
- Question of “common issue”
California law requires that the complaint contain a “common” issue to all putative class members. In our case, we will argue that there is not a common issue, as the employee records will indicate the individualized time entries, break times, and compensation for each employee. These are individualized disputes, and cannot be resolved by a class action lawsuit since all employee time records differ, and there is not a “uniform” policy or common error in place to make this action suitable for a class action lawsuit.
Below is supporting case law to this point.
On the issue of whether common issues predominate in the litigation, a court must “examine the plaintiff’s theory of recovery” and “assess the nature of the legal and factual disputes likely to be presented.” (Brinker, supra, 53 Cal.4th at p. 1025.) The court may consider the elements of the claims and defenses, but should not rule on the merits unless necessary to resolve the certification issues. (Ibid.; Lockheed Martin Corp. v. Superior Court (2003) 29 Cal.4th 1096, 1106; Linder, supra, 23 Cal.4th at pp. 439–440.) “The ‘ultimate question’ is whether ‘the issues which may be jointly tried, when compared with those requiring separate adjudication, are so numerous or substantial that the maintenance of a class action would be advantageous to the judicial process and to the litigants.’ ” (Brinker, at p. 1021.) “ ‘As a general rule if the defendant’s liability can be determined by facts common to all members of the class, a class will be certified even if the members must individually prove their damages.’ ” (Id. at p. 1022.)
For class certification purposes, a plaintiff is required to present substantial evidence that proving both the existence of an employer’s uniform policies and practices and the alleged illegal effects of such conduct could be accomplished efficiently and manageably within a class setting. (See Sotelo v. Medianews Group, Inc. (2012) 207 Cal.App.4th 639, 654 [“A class may establish liability by proving a uniform policy or practice by the employer that has the effect on the group of making it likely that group members will work overtime hours without overtime pay, or to miss rest/meal breaks.” (italics added) ].) [See more at: http://caselaw.findlaw.com/ca-court-of-appeal/1626126.html#sthash.CFaIVhYB.dpuf]
“Critically, if the parties’ evidence is conflicting on the issue of whether common or individual questions predominate (as it often is), the trial court is permitted to credit one party’s evidence over the other’s in determining whether the requirements for class certification have been met,” the appeals court said in Dailey v. Sears Robuck and Co. (2013).
- The existence of Company “guidelines” does not support certification absent an employer’s application of a uniform policy
Often, there is no uniform application of a company policy or guideline, other than to clock in and out for work time, and break times.
Further support for the proposition that merely stating a company has “guidelines” which violate California law, does not in itself support class certification, is in the case of Koval v. Pacific Telephone Co.
A recent case decided in January 2014 is Koval v. Pacific Bell Telephone Co., 232 Cal.App.4th1050 (2014), where plaintiffs alleged “systematic company guidelines” restricted employee activities during meal and rest breaks and “prevented employees from fully realizing the [meal and rest] breaks to which they were entitled.” Following Brinker Restaurant Corp. v. Superior Court, 53 Cal.4th 1004 (2012), the trial court held the mere existence of a uniform policy does not mandate class certification, concluding that variations in the employer’s application of policy created “serious doubt as to whether the rules were consistently applied so as to allow adjudication of the liability issues on a class-wide basis.” The California Court of Appeal affirmed, in a published decision.
The plaintiffs in the case sought to certify a class of approximately 6,700 current and former field technicians employed at company locations throughout California. Plaintiffs alleged the company failed to relinquish control over their activities during meal and rest breaks and thus violated California law. They argued that, collectively, an array of more than a dozen employer manuals contained “systematic company guidelines” prohibiting employees from doing any of the following during breaks: meeting up with their colleagues; going home; leaving their work vehicles; riding in other vehicles; sleeping in their work vehicles, or driving their work vehicles outside normal work routes to get a meal. Further, a company representative had testified that employees were “expected to adhere to the expectations” contained in a number of the manuals and that failure to do so could result in disciplinary action.
Opposing certification, the company submitted evidence that the manner in which supervisors enforced and/or orally conveyed the information in the written policies was highly variable, and therefore “determining whether the policies were so restrictive as to have transformed break time into work time would necessitate individualized inquires.”
The trial court denied certification, reasoning: “What is important, and ultimately fatal to Plaintiffs’ bid for class certification, is the manner in which the six rules reflected in the written materials were applied, and that in turn begins with the question of how the rules were communicated.”
On appeal, the court first recognized that, under Brinker, an employer is only obligated to make uninterrupted meal periods and rest breaks available to its employees, “but is not obligated to ensure they are taken.” The court then emphasized Brinker’s recognition that claims may be suitable for class treatment where (i) a uniform policy (ii) is consistently applied to a group of employees.
On this basis, the appellate court rejected plaintiffs’ argument that, under Brinker, plaintiffs did not need to “introduce facts showing both uniform policies and consistent application of those policies.” The court also rejected plaintiffs’ argument that the trial court had committed legal error by assessing “how the allegedly unlawful policies were implemented.” The failure of plaintiffs to demonstrate that the allegedly unlawful policies were consistently applied, the appellate court reasoned, “create[d] a shifting kaleidoscope of liability determinations that render this case unsuitable for class action treatment.”
Koval joins post-Brinker state court decisions such as Dailey v. Sears, Roebuck & Co. 214 Cal. App. 4th 974, 1002 (2013)(“the absence of a formal written policy explaining [employees’] rights to meal and rest periods does not necessarily imply the existence of a uniform policy or widespread practice of either depriving these employees of meal and rest periods or requiring them to work during those periods”) and In re Walgreen Co. Overtime Cases 231 Cal. App. 4th 437, 443(2014) (“under the Brinker’ make available’ standard, you additionally must ask why the worker missed the break before you can determine whether the employer is liable”) in requiring more than a uniform policy to support class certification. These cases strengthen employers’ hand in opposing class certification where the plaintiff cannot establish both (i) the existence of a uniform unlawful policy and (ii) the consistent application of that policy to a putative class.
The above mentioned cases support a deeper pre-certification analysis, which seems to be the trend in California over the last year or two, as courts attempt to halt the class action epidemic.
AL MOHAJERIAN – MOHAJERIAN APLC
Class certification is most often defeated where there is no “community of interest”, and most often for failure of commonality, or “predominance” grounds, rather than on the grounds of typicality, adequacy, ascertainability, and numerosity.
The ‘community of interest’ requirement embodies three factors: (1) predominant common questions of law or fact; (2) class representatives with claims or defenses typical of the class; and (3) class representatives who can adequately represent the class.
In opposing class certification defense has to show plaintiff would not be able to establish liability on the merits, i.e., there is no substance to the allegations complained of. Thus there is no commonality or predominance of class issues. There may be individualized issues but the common issues do not predominate.
Following is a synopsis of California law as it pertains to class certification:
In 2011, the United States Supreme Court raised the bar for plaintiffs seeking class certification by requiring lower courts to conduct a “rigorous analysis” to determine whether the prerequisites for certification are met. Wal-Mart, 131 S. Ct. at 2551 (reversing the grant of class certification due to a lack of commonality under Fed. R. Civ. P. 23(a)(2)). This “rigorous analysis,” the Court explained, often will “entail some overlap with the merits of the plaintiff’s underlying claim.” Id. In the words of the Court, a merits-entwined inquiry for purposes of class certification “cannot be helped.” Id. at 2551-52 (collecting cases).
Two years later, the Supreme Court doubled-down on its “rigorous analysis” requirement for class certification, applying the teachings of Wal-Mart to prospective Rule 23(b)(3) classes as well. See Comcast Corp. v. Behrend, 133 S. Ct. 1426, 1432 (2013) (reversing the grant of class certification due to a lack of predominance under Fed. R. Civ. P. 23(b)(3)). In Comcast, the Court criticized the lower court’s “refus[al] to entertain arguments against respondents’ damages model that bore on the propriety of class certification, simply because those arguments would also be pertinent to the merits determination.” Id. at 1432-33. Rather, the Court’s precedents “flatly” require a determination that Rule 23 is satisfied, “even when that requires inquiry into the merits of the claim.” Id. at 1433.
The third installment in the Supreme Court’s class-action trilogy came in 2014 in Halliburton Co. v. Erica P. John Fund, Inc., 134 S. Ct. 2398 (2014). There, the Supreme Court opened the door even further to merits-based defenses at the class-certification stage—this time in the context of securities class actions. In Halliburton, the Court held that securities defendants can rebut the presumption of reliance under a fraud-on-the-market theory not only during the merits phase but also during class certification. Id. at 2414-15. Securities defendants, moreover, can rebut this presumption through the use of direct and indirect evidence alike. Id. at 2417.
The Wal-Mart/Comcast/Halliburton triumvirate marked big wins for class-action defendants, enabling them to raise merits-based defenses that might otherwise never be presented to a court. That is so because many class cases are settled following certification, given the high stakes of merit-stage proceedings. Now, those merits issues are ripe for consideration at the class stage, to the extent they inform the certification analysis.
Other courts have also followed these decisions discussed above. To the extent the propriety of certification depends upon disputed threshold legal or factual questions, a court may, and indeed must, resolve them”); Bartold v. Glendale Fed. Bank, 81 Cal. App. 4th 816, 829 (2000) (“when the merits of the claim are enmeshed with class action requirements, the trial court must consider evidence bearing on the factual elements necessary to determine whether to certify the class”). Wal-mart Stores, Inc. v. Dukes , 131 S. Ct. 2541, 2551-52 (2011) (citing Gen. Telephone Co. of S.W. v. Falcon, 457 U.S. 147, 102 S. Ct. 2364, 72 L. Ed. 2d 740 (1982)); see also Ellis v. Costco Wholesale Corp., 657 F.3d 970, 984 (9th Cir. 2011) (holding the district court erred by failing to conduct a “rigorous analysis” of the merits to determine whether the plaintiffs had established commonality under Rule 23); In re Hydrogen Peroxide Antitrust Litig., 552 F.3d 305, 318 (3d Cir. 2008) (class certification requires “thorough examination” of factual and legal allegations; “rigorous analysis may include a preliminary inquiry into the merits” and consideration of “the substantive elements of the plaintiffs’ case in chief).
To be fair however, many courts in California are reluctant to quickly dismiss a class certification effort. The abuse of class action lawsuits however, has caused many California courts to direct more attention to the actual facts underlying Plaintiffs’ claims in a class action, to determine whether Plaintiff can produce any substantive claim, prior to a lengthy and costly class action lawsuit.