Duane Morris Class Action Review - 2023 - Report - Page 72
and unloads airplane cargo. However, in doing so, the Supreme Court narrowly
interpreted the scope of the exemption, rejecting Saxon’s argument that the exemption
should apply to all airline employees. The Supreme Court explained that the focus of
the exemption analysis is on the actual work performed by the employee, and not on
what the employer does generally. Id. at 1784. It further held that an exempted worker
“must at least play a direct and ‘necessary role in the free flow of goods’ across
borders.” Id. at 1784 (citing Circuit City Stores, Inc. v. Adams, et al., 532 U.S. 105, 121
(2001)).
Following Saxon, on October 17, 2022, the U.S. Supreme Court granted certiorari and
vacated the Ninth Circuit’s decision in Carmona. Domino's Pizza v. Carmona, et al.,
2022 WL 9552609 (U.S. Oct. 17, 2022). The Supreme Court did not provide any
reasoning in vacating Carmona, but instructed the Ninth Circuit to reconsider the appeal
in light of Saxon. The grant of certiorari in Carmona signals that a majority of the
Supreme Court believes the case was wrongly decided in light of its more-narrow view
of the class of workers covered by the transportation exemption. As of the close of the
year, the Ninth Circuit has not yet issued its decision on remand in Carmona.
Two recent decisions from the First Circuit - both issued after Saxon - show how some
courts are limiting plaintiffs’ strategy to use the transportation exemption to avoid
arbitration.
In Immediato, et al. v. Postmates Inc., 2022 U.S. App. LEXIS 32848 (1st Cir. Nov. 29,
2022), the plaintiffs worked for Postmates Inc., an online and mobile platform that
enables customers to order take-out meals from local restaurants as well as food from
local grocery stores. They filed a state law class action alleging they were misclassified
as independent contractors. After removing the case, the defendant moved to compel
arbitration. The plaintiffs argued the transportation exemption applied. The district court
disagreed and ordered the case stayed pending the outcome of the arbitration
proceeding. In affirming the district court’s order, the First Circuit discussed two of its
earlier decisions involving the exemption. In one involving last-mile Amazon.com
delivery drivers, the drivers were considered exempt because the long-reach of
Amazon’s chain of suppliers meant that the goods the drivers were delivering were in
the flow of interstate commerce. In the other case involving Lyft drivers transporting
travelers from the airport to their homes or hotels, the drivers did not fall within the
exemption because those drivers simply provide local transport service, and therefore
their work does not provide an integral part of interstate transportation, according to
controlling Supreme Court precedent. The First Circuit then rejected the plaintiffs’
argument, that if they were not found to be engaged in interstate commerce under
section 1 of the FAA, they were by definition outside of the scope of section 2 of the
FAA, which provides that the statute applies to all contracts involving interstate
commerce. It did so because it held that the terms “engaged in interstate commerce”
and “involving interstate commerce” are not coextensive.
The very next week, the First Circuit applied this same reasoning to another delivery
driver class action in Levine, et al. v. Grubhub Holdings Inc., 2022 U.S. App. LEXIS
33321 (1st Cir. Dec. 2, 2022). The First Circuit opined that “it would serve no useful
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Duane Morris Class Action Review – 2023
