18th Annual Workplace Class Action Report - 2022 Edition

Annual Workplace Class Action Litigation Report: 2022 Edition 435 requiring private employers to pay employees for sick and safe leave. The Ordinance required employers to “provide sick and safe leave at the rate of pay that the employee would have earned if the employee had worked the scheduled work time, exclusive of any overtime premium, tips, or commissions, but no less than the state minimum wage.” Id. at *4. Plaintiffs, a group of business and business associations, filed a class action alleging that the Texas Minimum Wage Act (“TMWA”) preempted the ordinance. More entities petitioned to intervene with community advocates intervening as Intervenor-Defendants, and businesses and the State of Texas intervening as Intervenor-Plaintiffs to support the preemption claim. Plaintiffs sought a temporary injunction to prevent the Ordinance from taking effect. The trial court granted Plaintiffs’ request for a temporary injunction. On Defendant’s appeal, the Texas Court of Appeals affirmed the trial court’s order granting the injunction. The Court of Appeals held that the Ordinance violated the Texas Constitution because the paid sick and safe leave provision of the Ordinance established a minimum wage that was inconsistent with the TMWA. In so ruling, the Court of Appeals discerned the legislature’s intent as to the term “wage” because the TMWA does not define “wage” by applying the word’s common meaning, including the presumption that wage retains its broad meaning, and considering its meaning in the statute’s context. Id . at *6. Thus, the Court of Appeals determined that the legislature’s intent in its use of the term “wage” in the TMWA meant a payment to a person for services rendered. Id . In holding that the Ordinance established a minimum wage, the Court of Appeals looked to the language of the Ordinance, which required employers to pay sick leave. This meant that employers must pay those employees who earn and take sick and safe leave more than employees who work the same hours without paid sick leave. As a result, the Court of Appeals held that Ordinance’s “paid sick and safe leave” requirement established a minimum wage in violation of the Texas Constitution. Id . at *22. In addition, the Court of Appeals rejected Defendant’s argument that the trial court abused its discretion in granting the temporary injunction on the basis that neither the businesses nor the State presented any evidence of a probable, imminent, and irreparable injury. In its ruling, the Court of Appeals only addressed the State’s claimed injury, i.e. , that its sovereignty would be injured irreparably by the Ordinance. In sum, the Court of Appels held that Plaintiffs had pled and proved each essential element for the trial court to grant the temporary injunction on the preemption claim because the State’s sovereignty would be irreparably injured by the Ordinance. For these reasons, the Court of Appeals affirmed the trial court’s order granting an injunction. (xx) Washington Kayshel, et al. v. Chae Inc., 2021 Wash. App. LEXIS 1217 (Wash. App. May 17, 2021). In this fee dispute two attorneys at separate law firms, Harish Bharti and Stephen Teller, associated to represent Plaintiff on a discrimination case as well as a wage & hour class action against Plaintiff’s employer. Plaintiff initially retained Teller, a principal of Teller & Associates PLLC, as his attorney. Teller initiated Plaintiff’s individual race discrimination suit as well as the putative class action. Teller initially associated with the law firm of Terrell, Marshall, Daudt & Willie PLLC as class co-counsel. After Terrell encouraged early mediation, Plaintiff sought advice from attorney Bharti, a principal of Bharti Law Group. Bharti then substituted in for the Terrell firm. Bharti then reached out to law firm Friedman Rubin as class co-counsel. Thereafter, Teller and Bharti met over breakfast and signed a one-page, handwritten fee division agreement (“Bharti/Teller Agreement”) on both the discrimination case and the class action case. In the class action case the two agreed that Bharti would receive 23% and Teller would receive 12% of the contingent legal fees. After the meeting, Bharti emailed Teller to memorialize the contents of the agreement. He wrote that “client has already given phone approval, will take care of getting client’s written approval of the attached agreement.” Id . at *5. However, Plaintiff never signed the Bharti/Teller Agreement. Teller withdrew prior to the class action case reaching settlement. After the class action settled, Bharti and Teller disputed how to share their portion of the Court-approved contingency fees in the class case. The trial court disagreed with Bharti that Teller should receive nothing and awarded Teller $6,720 in prejudgment interest and $200 in attorney fees, a percentage of the fees based on the fee division agreement and Bharti’s promise to Teller that Bharti would honor that agreement. Bharti appealed to the Washington Court of Appeals and argued that the trial court erred by concluding that the Bharti/Teller Agreement was enforceable under Rule of Professional Conduct (“RPC”) § 1.5(e)(1). The Court of Appeals agreed with Bharti and held that the fee division agreement between the two attorneys failed to satisfy the requirements of RPC § 1.5(e)(1)(ii), and reversed the trial court’s order. RPC § 1.5(e)(1)(ii) provides that a fee division between attorneys who are not at the same firm is permitted only if the client agrees to “the arrangement, including the share each lawyer will receive, and the agreement is confirmed in writing.” Id . at *7. On appeal Teller argued that RPC § 1.5(e)(1)(ii) did not require that Plaintiff actually sign the Bharti/Teller Agreement because Plaintiff had signed