|March 2, 2011|
Previously published on February 24, 2011
And no, we're not talking about cars, but about wage and hour cases in which plaintiffs assert an opt-in claim under the Fair Labor Standards Act, and a state-law wage and hour claim, which typically is an opt-out class action.
As with much in class and collective action practice these days, whether these two kinds of cases are oil and water or chocolate and peanut butter depends on whom you ask: the rules vary widely by circuit and sometimes even by district. The latest additions to the tennis match are two decisions by the Hon. John E. Jones III, of the Middle District of Pennsylvania. Ruling in two cases involving the Rite-Aid drug store chain, Judge Jones held that Congress's intent that FLSA collective actions be maintained only on an opt-in basis -- requiring individuals affirmatively to raise their hands to participate in the case as plaintiffs -- is incompatible with state opt-out classes, in which everyone who fits within the class definition is included in the class unless he or she raises a hand to opt out.
Even more interestingly, the cases before Judge Jones did not involve FLSA and state law claims together; rather, the state and federal claims were asserted in three different actions. Two individuals, one from Maryland and one from Ohio, asserted state law class claims against Rite Aid, claiming federal jurisdiction under the Class Action Fairness Act; and those two individuals had also opted in to a separate FLSA case that had been conditionally certified.
Judge Jones reasoned that Congress's intent was clear that FLSA claims should be decided on an opt-in basis, and allowing the same plaintiffs to pursue state claims based on the same underlying conduct on an opt-out basis would effectively nullify Congress's command.
Other courts disagree, finding no incompatibility since the claims arise under the laws of different jurisdictions. Most recently the Seventh Circuit brushed off a challenge to hybrid cases with relative indifference, in its January 18 decision in Ervin v. OS Restaurant Services, suggesting that the issue did not even raise a close question.
It appears we will get no uniform rule on this question until the Supremes take it up. Until then, the hospitability of individual courts to hybrid cases will continue to encourage forum shopping.