Duane Morris Class Action Review - 2023 - Report - Page 230
Meyers Squibb, the court held that the non-resident putative collective action members’
claims did not arise out of defendant’s activities in North Carolina and thus it could not
assert specific jurisdiction over the defendant as to those claims. Accordingly, the court
found it had no jurisdiction over non-residents’ FLSA claims, granted defendants’ motion
to dismiss or strike, and dismissed the claims of every putative opt-in in that did not
reside in North Carolina.
Another growing trend used to defend against FLSA actions is to force the plaintiffs to
adhere to provisions that mandate they arbitrate their FLSA disputes on a bilateral,
individual basis. This procedural defense can often significantly delay and potentially
defeat conditional certification under 29 U.S.C. § 216(b) or class certification under Rule
23.
In Re A&D International, Inc., 33 F.4th 254 (5th Cir. 2022), the defendant sought a writ
of mandamus challenging the district court’s order to issue notice to the members of a
putative FLSA collective action. The district court conditionally certified a collective
action of exotic dancers working at the defendant’s gentleman’s club, despite the
defendant’s argument that all putative collective members were subject to valid
arbitration agreements. Id. at 257-58. The district court reasoned that the defendant had
not moved to compel arbitration, and therefore dissemination of the § 216(b) notice was
appropriate even if the individuals would later be subject to arbitration. Id. On appeal,
the Fifth Circuit found mandamus appropriate since the harm - the dissemination of
notice - would be irremediable in the absence of mandamus. Id. 256-58. The Fifth
Circuit also found that the defendant did not need to file a motion to compel because it
had sought to compel arbitration by opposing conditional certification. As a result, the
Fifth Circuit reversed the district court’s decision and granted a writ of mandamus.
Similarly, in Bogie, et al. v. Wonolo Inc., 2022 U.S. Dist. LEXIS 66878 (C.D. Cal. Apr. 8,
2022), the plaintiff, a temporary worker placed by the staffing company, claimed he was
misclassified as an independent contractor and was not paid for overtime in violation of
the FLSA. The plaintiff sought to conditionally certify a collective action and disseminate
notice to the members of the proposed collective action. The defendant brought a
motion to compel arbitration based on the fact that the plaintiff had executed an
Independent Contractor Services Agreement that contained a valid and binding
arbitration clause. Id. at *3. While the plaintiff claimed he did not understand that he
would be obligated to arbitrate his dispute, the court rejected the plaintiff’s claimed
ignorance in light of his admission that he scrolled through the Agreement before
executing it. Id. at *4. Given pending motions brought by the defendant against the two
existing opt-ins to the lawsuit, who also were subject to valid arbitration agreements, the
court granted the defendant’s motion to compel arbitration and denied the plaintiff’s
motion seeking conditional certification and dissemination of the notice. Id. at *11.
D.
Rulings Decertifying Collective Actions
The defendants that managed to decertify collective actions in 2022 did so in primarily
two ways. First, the defendants were able to demonstrate the lack of a common policy,
plan, or decision that applied to all opt-ins. Second, employers were able to leverage
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Duane Morris Class Action Review – 2023
