WASHINGTON (Legal Newsline) - The U.S. Supreme Court has agreed to review a federal appeals court ruling that some claim improperly certified a wage and hour class action lawsuit.
The nation’s highest court granted Tyson Foods Inc.’s petition for writ of certiorari, according to an order list released Monday.
The pork processing company is challenging the $2.8 million in money damages awarded to a class of current and formerly hourly workers at an Iowa plant. The line employees work or worked on the slaughter and processing floors of its Storm Lake facility.
The employees sued, alleging they are entitled to overtime compensation and liquidated damages because Tyson failed to compensate them fully for time spent “donning” and “doffing” their protective equipment and walking to and from their work stations.
“The district court certified the class based on the existence of common questions about whether these activities were compensable ‘work,’ even though there were differences in the amount of time individual employees actually spent on these activities and hundreds of employees worked no overtime at all,” according to Tyson’s petition.
“The court then allowed plaintiffs to ignore these individual differences and ‘prove’ liability and damages to the class with ‘common’ statistical evidence that erroneously presumed that all class members are identical to a fictional ‘average’ employee.
“The end result of this ‘undifferentiated presentation of evidence’ was a ‘single-sum class-wide verdict from which each purported class member, damaged or not, will receive a pro-rata portion of the jury’s one-figure verdict.’”
In August, the U.S. Court of Appeals for the Eighth Circuit upheld the district court’s decision and entered judgment against Tyson, and in November denied the company’s request for a rehearing.
In March, Tyson filed a petition for review with the Supreme Court.
The company argues that the Eighth Circuit’s ruling sanctioned the use of “seriously flawed” procedures that many district courts have used to permit certification and adjudication of class actions.
“The Eighth Circuit’s affirmance of that unjust result warrants review because it exacerbates two circuit splits and conflicts with this Court’s decisions in Wal-Mart Stores Inc. v. Dukes and Comcast v. Behrend,” Tyson’s lawyers wrote in the petition.
“Wal-Mart and Comcast should have put a stop to class certification premised on the notion that classwide liability and damages can be established through a ‘trial by formula,’ and damages models that ignore the basis of the defendant’s putative liability to each class member.”
Tyson’s case raises two questions, in particular:
1. Can differences among individual class members be ignored and a class action certified where liability and damages will be determined with statistical techniques that presume all class members are identical to the average?
2. Can a class action be certified and maintained when the class contains hundreds of members who were not injured and have no legal right to any damages?
While the Supreme Court agreed to hear Tyson’s case, it took no action on two other petitions filed by Wal-Mart that raise similar questions.
Those challenges most likely will be decided after the high court makes a ruling in Tyson’s case.
The court is expected to hear the case in the fall and a ruling is expected by the end of its next term, in June 2016.
Business groups, including the National Association of Manufacturers and the U.S. Chamber of Commerce, filed amicus briefs in the case.
The Chamber, which is backing Tyson, said the district court’s use of statistical averages is an “inadequate substitute” for the individualized liability determinations that are required when individual claimants have very different factual circumstances.
“If the decision below is allowed to stand, Rule 23’s essential safeguards and the minimum requirements for Article III standing will be significantly eroded,” according to the Chamber’s brief, filed with the Supreme Court in April. “And it may send an unfortunate signal that this Court is unwilling to enforce its precedents and ensure that Rule 23’s requirements are properly observed.
“This case thus presents an excellent opportunity for the Court to resolve existing splits in lower court authority, to address ongoing abuses in class-action litigation, and to restore proper
constitutional limits on lawsuits involving individuals who have suffered no injury.”
The Chamber’s Institute for Legal Reform owns Legal Newsline.
Among those also filing briefs were the Washington Legal Foundation and the Equal Employment Advisory Council. Both argue that the district court and Eighth Circuit improperly certified the class.
Tyson is represented by Washington, D.C., law firms Hunton & Williams and Sidley Austin LLP. The employees are represented by consumer advocacy group Public Citizen.
From Legal Newsline: Reach Jessica Karmasek by email at jessica@legalnewsline.com.