Duane Morris Class Action Review - 2023 - Report - Page 71
record of pro-employee decisions, it ultimately may conclude that, even if an individual
PAGA claim has successfully been compelled to arbitration, the plaintiff still has
standing to pursue a separate representative PAGA claim in court. Thus, while the
Viking River Cruises decision was initially seen as a big win for employers, it may
ultimately be the case that the decision merely permits a PAGA plaintiffs to split their
claims and pursue them in two separate forums. Briefing in Adolph has concluded and a
decision is expected in 2023.
C.
Rulings On The FAA’s Transportation Worker Exemption
Section 1 of the FAA provides that transportation workers engaged in interstate
commerce are exempt from arbitration. 9 U.S.C. § 1. The plaintiffs’ bar has increasingly
used this exemption to keep their clients out of the arbitral forum, as exemplified in two
recent decisions of significance – Carmona, et al. v. Domino’s Pizza, LLC, 21 F.4th 627
(9th Cir. Dec. 23, 2021), and Southwest Airlines Co. v. Saxon, et al., 142 S. Ct. 1783
(2022).
Carmona is a putative wage and hour class action brought by Domino’s drivers who
deliver goods from a supply center in California to Domino’s stores also in California.
Dominos buys various goods from suppliers outside of California that are delivered by
third parties to a Southern California supply center. Delivery drivers then pick up the
supplies from the supply center and deliver them to Domino’s franchisee locations in
California so they can make pizzas. In response to Domino’s motion to compel
arbitration, Carmona argued the delivery drivers were exempt from arbitration because
they were “transportation workers” within Section 1 of the FAA.
Section 1 exempts from arbitration “contracts of employment of seamen, railroad
employees, or any other class of workers engaged in foreign or interstate commerce. 9
U.S.C. § 1. This latter language setting out the last category of exempt workers is
referred to as the “residual clause.” The Ninth Circuit held that the “critical factor” in
determining whether the residual clause applies “is not the nature of the item
transported in in interstate commerce (person or good) or whether the plaintiffs
themselves crossed state lines, but rather the nature of the business for which a class
of workers performed their activities.” Carmona, 21 F.4th at 629. “The exemption
applies if the class of workers is engaged in a “single, unbroken stream of interstate
commerce’ that renders interstate commerce a ‘central part’ of their job description.” Id.
(quoting Capriole, et al. v. Uber Technologies, Inc., 7 F.4th 854, 866 (9th Cir. 2021)).
The Ninth Circuit held the drivers fell within the transportation worker’s exemption even
though they never crossed state lines because they transported pizza ingredients and
other goods that traveled interstate “for the last leg” to Domino’s franchisees in
California.
In June 2022, the U.S. Supreme Court addressed the transportation exemption in
Southwest Airlines Co. v. Saxon, et al., 142 S. Ct. 1783 (2022), a putative class action
alleging violations of the FLSA. In a unanimous decision, the Supreme Court held that
the transportation exemption applies to an airline ramp supervisor who frequently loads
70
© Duane Morris LLP 2023
Duane Morris Class Action Review – 2023
