In Wave of Opinions, Court Rejects ADA Requirement for Braille Gift Cards

On Friday, April 23, 2020, Judge Gregory Woods of the Southern District of New York issued a first of its kind decision rejecting the argument that ADA Title III requires business that offer gift cards to also offer them in Braille. Dominguez v. Banana Republic, LLC, 1:19-cv-10171-GHW (S.D.N.Y. April 23, 2020).  The decision is the first in almost 250 nearly identical cases filed in the Southern and Eastern Districts of New York since the fourth quarter of 2019, and may be persuasive authority for other judges faced with similar claims. In the past few days, Judge Woods dismissed half a dozen Braille gift card cases based on the same legal theory, explaining that there are “virtually no difference[s]” between the cases, dismissing the claims “for all of the reasons identified in Banana Republic.”

Please find the rest of this article on our Disability, Leave & Health Management Blog here.

Ninth Circuit: FCRA Does Not Require Disclosure to be Distinct in Time from Other Employment Documents

The Ninth Circuit recognized that plaintiff’s argument was novel but was thwarted by the statute itself.  Plaintiff below, argued on behalf of a class, that the company violated the Fair Credit Reporting Act (FCRA) by presenting the FCRA disclosure at the same time the company presented other separate documents.  The District Court granted summary judgment and the Ninth Circuit affirmed. Luna v. Hansen and Adkins Auto Transport, Inc., No. 18-55804 (9th Cir. Apr. 24, 2020).

The FCRA does not allow procurement of a consumer report for employment purposes unless “a clear and conspicuous disclosure has been made in writing to the consumer . . . in a document that consists solely of the disclosure.” 15 U.S.C. §1681b(b)(2)(A)(i).

A former employee of a vehicle transportation business received a Commercial Driver Employment Application. This application was a multi-form, multi-page document that included notices and authorizations permitting the company to retrieve safety history and driving records and to conduct drug and background checks. Job applicants signed two documents related to consumer reports. First, the disclosure document appeared on a separate sheet of paper and informed applicants, “[R]eports verifying [applicant’s] previous employment, previous drug and alcohol test results, and [applicant’s] driving record may be obtained on [applicant] for employment purposes.” The second document, the authorization, indicated that an applicant’s signature authorized the company or their subsidiaries or agents to “investigate [applicant’s] previous record of employment.” The authorization appeared at the end of the application and included other notices, waivers, and agreements that were not related to obtaining the consumer report.

The plaintiff filed a putative class action alleging the company’s hiring process violated disclosure and authorization requirements of the FCRA. The plaintiff alleged that because the disclosure was provided together with other application materials, the FCRA was violated. The Ninth Circuit disagreed, finding this argument “stretches the statute’s requirements beyond the limits of law and common sense.”

Further, while acknowledging a disclosure form cannot contain anything other than the disclosure itself, the Court held that no authority suggests that a disclosure must be distinct in time as well. The Court stated that if they were to accept the plaintiff’s argument that a FCRA disclosure cannot be presented together with other employment documents, “it is difficult to see how an employer could ever provide an applicant written application materials without violating FCRA’s standalone document requirement.”

As FCRA class action lawsuits continue to be filed at an increasing rate, the decision is worth a close reading by employers grappling with complying with the highly technical statute. Jackson Lewis attorneys are available to assist employers with their compliance efforts.

Fifth Circuit: Arbitrator Properly Interpreted Arbitration Agreement to Allow for Collective Claims

Consistent with the terms of the arbitration agreement at issue, an hourly fuel tech and driver is entitled to arbitrate collective claims alleging that his employer violated the Fair Labor Standards Act (FLSA), the federal appeals court in New Orleans has ruled.  Sun Coast Resources Inc. v. Roy Conrad, No. 19-20058 (5th Cir. Apr. 16, 2020). This decision highlights the critical need for employers to ensure careful drafting of arbitration agreements.

In this case, pursuant to an arbitration agreement, the plaintiff brought his FLSA overtime claim in arbitration on behalf of a class of similarly situated employees. In a clause construction award, the arbitrator determined “the agreement . . . clearly provides for collective actions.” Sun Coast asked the district court to vacate the award. The district court declined to vacate the award, determining that the arbitrator had not exceeded his powers in interpreting the agreement.

On appeal to the Fifth Circuit, the Court determined that in this instance, the breadth of the agreement and the authorization of “all remedies which might be available in court,” paired with the fact that the employer failed to “carve out” class proceedings suggested that class arbitration was appropriate. The Court said the arbitrator also noted that the parties agreed the American Arbitration Association (AAA) rules for employment disputes would govern arbitration, which permit class proceedings.

The employer’s principal argument was that the arbitration agreement’s terms did not expressly provide for collective proceedings.  As a result, there could be no class arbitration. The Court noted that Sun Coast did not dispute the arbitrator’s authority to decide class arbitrability at any time during the arbitration proceedings. To the contrary, the company stated in its arbitration briefing that the only issue was whether the parties “agreed to authorize” collective arbitration in the first place. Additionally, this authority was not timely challenged before the district court. The Fifth Circuit affirmed the district court’s determination.

If you have questions or if you require assistance in reviewing your arbitration agreements, please contact a Jackson Lewis attorney.

FLSA Collective Action Trimmed Because Court Lacked Specific Jurisdiction

A Minnesota federal district court recently denied FLSA conditional certification over the claims of workers who were not assigned to a Minnesota project at issue or not Minnesota residents due to specific jurisdiction considerations. Vallone et al. v. The CJS Solutions Group, LLC, No. 19-1532 (D. Minn. Feb. 5, 2020).

The court based its decision on a 2017 U.S. Supreme Court decision that held that due process requires a court to have specific jurisdiction over a defendant in a mass action only if the action arises out of or relates to that defendant’s contacts with the forum.

The plaintiffs in Vallone assisted physicians, nurses, and others with transitioning to new computerized patient-management systems in hospitals and other health care facilities nationally. The defendant-company is headquartered and has its principal place of business in Florida. The named plaintiffs traveled to facilities in Minnesota and hospitals in Missouri and New York. The plaintiffs claimed the company did not lawfully pay them for time spent traveling from remote locations to worksites during the workday or for a cancelled day of training for the Minnesota project that required some workers to travel to Minnesota.

The plaintiffs sought conditional certification of “all hourly paid, non-exempt, W-2 employees … whose time was neither paid under the [FLSA]” (1) while engaging in travel wherein the travel was undertaken during the employee’s normal working hours; or (2) for the cancelled training day in Minnesota for workers who did not live in the area.

The defendant-company argued, under Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017), that the District of Minnesota Court lacked specific jurisdiction over the company as to any putative plaintiff who worked outside the state of Minnesota. Because the plaintiffs in an FLSA collective action must opt-in to be included in a lawsuit, similar to a mass action, the opt-in plaintiffs’ claims establish the underlying controversy against the defendant, the court in Vallone reasoned. The court held that only if the claims arise out of or relate to the defendant’s contacts with Minnesota can it constitutionally exercise jurisdiction over the defendant.

Many courts are applying Bristol-Myers in the FLSA collective action context. Defendants in such actions should consider whether a potential collective may be limited at the conditional certification stage or earlier. Moreover, they should evaluate whether narrowing the size of the collective is possible right away so that they may properly raise the defense in their responsive pleadings. Please contact a Jackson Lewis attorney with any questions.

Seventh Circuit Denies Full Court Review of Class Notice Question

The U.S. Court of Appeals for the Seventh Circuit has denied en banc review of a ruling that created a new framework for when employees who have entered into arbitration agreements receive collective action notices.

Earlier this year, in a case of first impression, the Seventh Circuit developed a required framework for a district court to evaluate a plaintiff’s request that the court authorize notice to putative class members who have entered into arbitration agreements with their employer.  The Seventh Circuit vacated the district court’s order issuing notice and remanded for the lower court to apply the new standard. (A detailed summary of this ruling can be accessed here)

We will be watching closely to evaluate how the district court in this case and other cases applies the Seventh Circuit’s new framework. Please contact a Jackson Lewis attorney with any questions about this case.

Two More Significant Rulings for TCPA Litigation – Eleventh and Seventh Circuits Narrowly Interpret ATDS

In back-to-back decisions bound to have significant impact on Telephone Consumer Protection Act (TCPA) class action litigation, the Eleventh and Seventh Circuit Courts recently reached similar conclusions, narrowly holding that the TCPA’s definition of Automatic Telephone Dialing System (ATDS) only includes equipment that is capable of storing or producing numbers using a “random or sequential” number generator, excluding most “smartphone age” dialers. Each court expressly rejected the Ninth Circuit’s more expansive interpretation from a ruling in 2018, concluding that the TCPA covers any dialer that calls from a stored list of numbers “automatically”. These decisions are significant as most technologies in use today only dial numbers from predetermined lists of numbers.

Please find the rest of this article on our Workplace Privacy, Data Management & Security Report here.

The Supreme Court and the Future of the TCPA

In a decision that may have significant impact on businesses that face Telephone Consumer Protect Act (“TCPA”) related class action litigation, the Supreme Court recently accepted certiorari of a petition to rule on the constitutionality of the TCPA. The Court agreed to review a ruling of the Fourth Circuit which held that a TCPA exemption……

Please find the rest of this article on our Workplace Privacy, Data Management & Security Report here.

CCPA Data Breach Class Action Litigation Begins

As reported by Bloomberg Law, data breach class action litigation has begun under the California Consumer Privacy Act (CCPA). Filed in the Northern District of California, San Francisco Division, a putative class action lawsuit against Hanna Andersson, LLC and its ecommerce platform provider, Salesforce.com, alleges negligence and a failure to maintain reasonable safeguards, among other things, leading to a data breach.

Please find the rest of this article on our Workplace Privacy, Data Management & Security Report here.

Seventh Circuit Issues New Standard on Class Notice to Employees who Signed Arbitration Agreements

The U.S. Court of Appeals for the Seventh Circuit, in a case of first impression, has developed a required framework for a district court to evaluate a plaintiff’s request that the court authorize notice to putative class members who have entered into arbitration agreements with their employer.

The Seventh Circuit held on January 24, 2020, that notice of a collective action may be sent to putative class members who entered into arbitration agreements with class action waivers, unless (1) no plaintiff contests the existence or validity of the alleged arbitration agreements, or, (2) if contested by the plaintiffs, the defendant establishes, by a preponderance of the evidence, after the court allows discovery on the alleged agreements’ existence and validity, that a valid arbitration agreement exists for each employee it seeks to exclude from receiving notice.

The plaintiff, Susie Bigger, brought action against Facebook on behalf of herself and others “similarly situated” for violation of the FLSA overtime-pay requirements. Bigger asked the district court to authorize notice to the class of people she alleged were similarly situated. Facebook objected to the notice, arguing in part that many of the proposed notice recipients had entered arbitration agreements precluding them from joining the action and, therefore, those individuals were not “similarly situated” and that the notice would be misleading as they would not be eligible to join the action. The district court authorized notice of the collective action to the entire group of employees the plaintiff proposed, and Facebook appealed to the Seventh Circuit.

The Seventh Circuit reviewed the district court’s facilitation of notice for abuse of discretion. The question faced by the Court of Appeals was whether a court may authorize notice to individuals who, according to the defendant, entered valid arbitration agreements waiving their right to join the action. While this issue was considered in February 2019 by the U.S. Court of Appeals for the Fifth Circuit, in In re JPMorgan Chase & Co., 916 F.3d 494 (5th Cir. 2019), this is an issue of first impression for the Seventh Circuit.

The Seventh Circuit noted that while the twin goals of collective actions are enforcement and efficiency, they also recognized that collective actions present real dangers. Citing to the seminal Hoffmann-La Roche Inc. v. Sperling, 493 U.S. 165, 174 (1989), decision, the Seventh Circuit recognized the potential for abuse of the collective-action device and emphasized that courts “must be scrupulous to respect judicial neutrality” when monitoring the preparation and distribution of notice.

The Seventh Circuit then differentiated the case at bar from the Fifth Circuit’s case, In re JPMorgan Chase & Co., on the grounds that the plaintiff here did not yield to Facebook’s assertions about the existence and validity of the alleged arbitration agreements as the plaintiff had in the Fifth Circuit.

The Seventh Circuit created a new test for district courts to utilize in these circumstances and concluded that a court: (1) may not authorize notice to individuals whom the court has been shown entered mutual arbitration agreements waiving their right to join the action; and (2) must give the defendant an opportunity to make that showing.

When a defendant opposes the issuance of notice by asserting that some or all of the proposed notice recipients entered mutual arbitration agreements containing class action waivers, the trial court must first determine “whether a plaintiff contests the defendant’s assertions about the existence of valid arbitration agreements entered by proposed notice recipients.” If no plaintiff contests those assertions, then the court may not authorize notice to the employees whom the defendant alleges entered valid arbitration agreements. However, if a plaintiff contests the defendant’s assertions, then — before authorizing notice — the trial court must permit the parties to submit additional evidence of the agreements’ existence and validity. This may require that the parties engage in discovery on the issue of the existence and enforcement of the agreements. Ultimately, the employer carries the burden to show, by a preponderance of the evidence, the existence of a valid arbitration agreement with each employee it seeks to exclude from receiving notice. This framework could ultimately prove to be burdensome and costly for employers who implemented arbitration programs.

The Seventh Circuit vacated the district court’s order issuing notice and remanded for the lower court to apply the new standard. We will be watching closely to evaluate how the District Court in this case and other cases applies the Seventh Circuit’s new framework. Please contact a Jackson Lewis attorney with any questions about this case.

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