18th Annual Workplace Class Action Report - 2022 Edition

292 Annual Workplace Class Action Litigation Report: 2022 Edition pay Plaintiff’s attorneys’ fees and costs in connection with preparing the motion for sanctions and attending the hearings related to the motion. Grove, et al. v. Meltech, Inc. , 2021 U.S. Dist. LEXIS 74083 (D. Neb. April 15, 2021). Plaintiffs, a group of exotic dancers at an adult club, filed a collective action alleging that Defendant misclassified the dancers as independent contractors and thereby failed to pay them overtime compensation and minimum wages in violation of the FLSA. Plaintiffs filed a motion for civil contempt following allegations of that Defendant’s counsel sent email communications to Plaintiffs’ counsel that contained threats and accusations. The Court granted attorneys’ fees to Plaintiffs’ counsel, but declined to impose additional sanctions. The Court noted that it was “troubled” by Defendant’s position and the actions of Defendant’s counsel, but observed that they were generally complying with the Court’s orders and disseminated the FLSA collective notice to all relevant parties. Accordingly, the Court determined that the professed willingness of defense counsel to cooperate with the Court and with Plaintiffs’ counsel established that disqualification was not necessary at this point. Nonetheless, the Court reminded Defendant not to engage in any conduct, via social media or otherwise, to dissuade any dancer from opting-in to the collective action. Id . at *3. The Court also advised counsel that any failure to comply with the Court’s orders or further questionable conduct would result in sanctions. Id . The Court therefore awarded Plaintiffs’ counsel attorneys’ fees and denied the motion for sanctions. (xxxi) Settlement Approval Issues In Wage & Hour Class Actions And FLSA Collective Actions Aboumrad, et al. v. Borrego Springs Fire Protection District, 2021 U.S. Dist. LEXIS 41944 (S.D. Cal. March 5, 2021). Plaintiffs filed a collective action alleging various violations of the FLSA. The parties ultimately settled the action, and stipulated to joint settlement approval by the Court. Subsequently, the Court denied the motion for settlement approval. The Court determined that the settlement agreement did not properly join all parties to the settlement, as the settlement agreement listed the Borrego Springs Firefighters Association ("Association"), which is not a named party to the action. Because it found that it lacked personal jurisdiction over the Association, the Court denied the joint motion for settlement approval. The Court further noted that eight other listed employees signed acknowledgement forms, but the acknowledge forms did not state that these employees consented to become parties to the action under 29 U.S.C. § 216(b). The Court held that it also lacked personal jurisdiction over the other employees. The Court accordingly declined to approve the settlement unless all parties were properly before it, and thus denied the agreement without prejudice to refiling it after all parties have been properly joined. The Court also ruled that the settlement agreement’s release provision was overly broad, as it referenced that employees would be releasing wage & hour claims for work to be performed in the future. Id . at *5. Albelo, et al. v. Epic Landscape Products , 2021 U.S. Dist. LEXIS 120217 (W.D. Mo. June 28, 2021). Plaintiffs, a group of landscape laborers, some with H-2B work visas and some without, filed a class and collective action alleging that Defendant failed to pay overtime compensation in violation of state and federal labor laws. The parties subsequently settled the litigation and then filed a motion seeking preliminary settlement approval, which the Court denied. The Court found that the settlement contained a reversion provision, which it opined was not typically favored in wage & hour settlements. The Court also determined that the proposed settlement also contained a "clear sailing" agreement on attorneys’ fees, thereby ensuring there would be no briefing to alert the Court to potential issues. Id. at *4. The Court noted that in order to file a claim, each class member would need to submit a formal claim form to receive a settlement check. The Court disagreed with the propriety of the process, inasmuch as it would serve no useful purpose and appeared designed to lower the participation rate in the settlement. The Court explained that putative class members’ damage awards were easily calculable from information in Defendant’s possession, and Defendant had contact information for each class member. Thus, the parties would have the ability to mail each class member a settlement check along with a short description of what the check was for relative to the settlement terms. Id . at *5. The Court also reasoned that the class definition was not consistent throughout the agreement, which would lead to confusion. The Court also had concerns as to whether the named Plaintiff, who was not working subject to an H-2B visa, had standing to represent a class consisting of both workers with and without visas. The Court found insufficient explanation by the parties as to why the settlement amount was fair and reasonable. The Court observed that there was no way for class members to object to the settlement, no Spanish version of the terms, and problems with the