Wage & Hour Class and Collective Action Review — 2023 - Report - Page 17
assert personal jurisdiction over the defendant to adjudicate their claims, even if those
claims resemble those of other plaintiffs.
Federal circuits have been divided on the consequences of the Supreme Court's
decision in the context of collective and class actions. A ruling on this issue could
potentially curtail the venues in which plaintiffs' lawyers can file class and collective
actions against corporate defendants and, specifically, might limit the venues where a
plaintiff can initiate a nationwide action to those where a court can exercise general
personal jurisdiction over the defendant (i.e., typically only the state where the company
is organized and the state where it maintains its principal place of business).
Considering the defense's ability to fragment nationwide lawsuits, several defendants
invoked personal jurisdiction in 2022. In Fischer, et al. v. Federal Express Corp., 42
F.4th 366 (3d Cir. 2022), the Third Circuit joined the Sixth and Eighth Circuits in
concluding that Bristol-Myers requires a court to find personal jurisdiction over the
claims of opt-in plaintiffs in an FLSA collective action. The count of federal circuits
deciding that Bristol-Myers is applicable to collective actions increased in 2022 to three
(the Third, Sixth, and Eighth Circuits), with one circuit concluding otherwise (the First
Circuit).
During 2022, the parties in three cases challenging personal jurisdiction filed petitions for
certiorari by the U.S. Supreme Court, and requested that it address the question of
personal jurisdiction in the context of collective actions. The Supreme Court denied each
petition, most recently the Fischer petition on March 6, 2023. Consequently, it is highly
unlikely that the Supreme Court will resolve this issue in 2023, and corporate defendants
can continue to anticipate that personal jurisdiction will remain a powerful defense for
facing collective actions outside of their home states.
D.
Plaintiffs’ Ability To Extract Substantial Settlements Provides Huge
Incentive To Bring More Wage & Hour Litigation
Lastly, wage & hour class and collective actions were no exception to the rich
settlements scored by the plaintiffs’ class action bar in 2022. The top ten class and
collective action settlements in the wage & hour space totaled $574.55 million.
Key lessons emerge when analyzing the top wage & hour settlements of 2022. Four of
the top ten settlements involved claims that individuals were misclassified as
independent contractors rather than employees, demonstrating the importance of
thoroughly researching the appropriate classification of job positions. Two settlements
involved alleged violations of minimum wage laws, with two more pertaining to unpaid
overtime. Comprehensive policies and practices pertaining to compensation remain
crucial to defending lawsuits alleging unpaid work.
Venue may also affect plaintiffs’ ability to secure a large settlement. Half of the top ten
settlements were approved by federal or state courts in California, thereby
demonstrating the appeal of California’s courts to the plaintiffs’ bar. State courts, long
seen as more plaintiff-friendly than federal courts, were the situs of 60% of the top ten
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© Duane Morris LLP 2023
Wage & Hour Class And Collective Action Review – 2023
