LEGAL
Since 2010, the Supreme Court has been particularly active in the area of class-action lawsuits. In fact, the Court has addressed rulings on the subject more frequently in the past six years than it had in the 30 years prior.
And as most Court observers would point out, these rulings have been unfriendly to plaintiffs, almost without exception.
Perhaps the two most infamous of these recent rulings are 2011’s Wal-Mart Stores Inc. v. Dukes and AT&T Mobility LLC v. Concepcion. Wal-Mart raised the bar on the “commonality requirement” for class certification (making large class certification more difficult), while Concepcion ruled that states may not prohibit arbitration agreements from containing class-action waivers.
There have been several more since 2011, but they’ve almost consistently been friendly to defendants in class actions.
2016 is seemingly different, though. Back in January, the Court handed down its ruling in Campbell-Ewald Co. v. Gomez, which held 6-to-3 that a class action is not rendered moot by a defendant offering the lead plaintiff exactly what he demands. And at the end of March, the Court decided Tyson Foods v. Bouaphakeo, yet another class-action case – and one that was also decided in the plaintiff’s favor.
Bouaphakeo was brought by employees of Tyson Foods, specifically workers at the company’s meat-processing plant in Iowa. As part of their jobs, the employees were required to wear protective gear, which could vary depending on the tasks that a worker performed on a given day. Tyson “compensated some, but not all, employees for this donning and doffing,” and further didn’t track the time spent by each employee on these activities. Employees sued for unpaid overtime wages under the Fair Labor Standards Act (FLSA), claiming that Tyson’s policy to not pay for their time spent donning and doffing protective gear denied the employees overtime compensation required by the FLSA.
At trial, because Tyson did not track donning and doffing time, the employees were forced to rely on statistical averages to determine how much donning and doffing time was spent by each worker. Over Tyson’s objection, the district court allowed the action to proceed based on this formula (Tyson specifically pointed to the Court’s earlier ruling in Wal-Mart as prohibiting the use of representative evidence as a means of establishing the commonality necessary to certify a class).
The jury returned a verdict of $2.9 million in unpaid wages, and the Eighth Circuit affirmed.
The Court, in a 6-to-2 vote, affirmed, distinguishing Wal-Mart by pointing out that “the experiences of the employees in Wal-Mart bore little relationship to one another” and that the plaintiffs in the 2011 ruling “tried to use representative evidence “as a means of overcoming [the] absence of a common policy.”
In Tyson, by contrast, “each employee worked in the same facility, did similar work, and was paid under the same policy” and further could have relied on the same representative evidence had each plaintiff brought individual suits against their employer.
Does Tyson truly represent a reversal on class actions at the Court? The holding of Tyson alone wouldn’t seem to suggest a full reversal per se, especially considering that the majority essentially offered an important tip to future would-be defendants to attempt to block the admission of representative evidence through a Daubert challenge to the plaintiffs’ experts’ methodology.
Nevertheless, it’s important to note that the Court followed up its Tyson decision with two denials of certiorari on April 4: one from Wal-Mart and one from Wells Fargo. Both of these cases are class actions, and both were on hold pending the decision in Tyson because both involved questions of commonality among class members. And the denial of certiorari in both cases left in place judgments in favor of the class.
So while it doesn’t appear that the Court has completely switched its position on class actions, something seems to have changed, but it’s still too early to be able to fully identify the exact nature of that change.
Fortunately, we have another class-action case set for a decision this term – Robins v. Spokeo, Inc. (which I had previously wrote about in December 2015’s issue of Corporate Counsel Connect) – and the Court’s opinion in that case may provide more clarity to the issue.
But even if the Spokeo case doesn’t completely answer our questions about the Court’s direction on class actions, given its recent interest in class-action suits, we may not have to wait much longer for more opportunities to find out.
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