Attorney Publication
Jan 16, 2008
Seyfarth Shaw Class Action Report – 2008 Edition
On January 14, 2008, Seyfarth Shaw LLP published its fourth Annual Workplace Class Action Litigation Report. The Report examines the leading class action and collective action decisions in 2007 involving workplace issues. The Report, authored by Seyfarth Shaw’s employment attorneys, underscores and highlights the strategies of the private plaintiffs’ bar and government enforcement attorneys in their pursuit of class action and collective action litigation against employers. The Report notes three leading trends: the volume of wage and hour litigation continues to increase exponentially; the Class action Fairness Act of 2005 (CAFA) continued to have significant effects on workplace litigation, primarily wage and hour class actions filed in state court; and the financial stakes in workplace litigation increased yet again in 2007. The Seyfarth Shaw report is the only national report in existence analyzing workplace class action rulings. It is organized on a circuit-by-circuit and state-by-state basis of class action and collective action rulings involving claims brought against employers in all fifty state court systems, including decisions pertaining to employment discrimination laws, wage & hour laws, and Employee Retirement Income Security Act (ERISA) actions. The key class action settlements are analyzed both in terms of gross settlement dollars in private plaintiff and government-initiated lawsuits as well as injunctive relief provisions in consent decrees. In total, 508 decisions are analyzed in the 468-page Report. As an additional benefit, this year's report also includes important federal and state court rulings in non-workplace cases which are significant in their impact on the defense of workplace class action litigation. As in past years, Seyfarth Shaw analyzes the impact of the CAFA on workplace litigation, and its effects on litigation strategy and the structuring of class actions filed against employers.
Some of the highlights of this year's report include:
- While shareholder and securities class action filings experienced a slight uptick in 2007, employment-related class action filings increased significantly. Anecdotally, surveys of corporate counsel confirmed that workplace litigation – and especially class action and multi-plaintiff lawsuits – continues as the chief exposure driving corporate legal budget expenditures.
- In terms of key decisions, there was no class action ruling in 2007 quite like Dukes, et al. v. Wal-Mart Stores, Inc., a Title VII gender discrimination case challenging pay and promotions involving 1.5 million class members. The U.S. Court of Appeals for the Ninth Circuit agreed to hear a discretionary appeal from the class certification decision and heard oral argument on the Dukes appeal on August 8, 2005. Many expected a ruling in 2006, but none came until nearly 18 months later on February 6, 2007, when a three-judge panel affirmed the certification order by a 2-to-1 vote. Wal-Mart subsequently filed a petition for rehearing en banc by the entire Ninth Circuit. On December 11, 2007, the panel mooted that petition by vacating its earlier ruling and issuing a new ruling that refined its Rule 23 analysis, while reaching the same result. A future ruling by the Ninth Circuit in Dukes on a subsequent rehearing en banc – and further appellate proceedings thereafter, including a possible appeal to the U.S. Supreme Court – likely will be one of the top class action developments in 2008 and beyond.
- The certification order in Dukes, et al. v. Wal-Mart Stores, Inc. influenced many class action developments in 2007. The plaintiffs’ bar increasingly used the theories endorsed in Dukes to seek certification of “punitive damages” only classes under Rule 23(b)(2), as well as pressing for certification of mega-classes involving pay and promotion claims of employees in multiple company facilities on a nationwide basis. Outside of the Ninth Circuit, employers fought these theories with good success, as 2007 witnessed many pro-employer victories in class certification battles.
- If trials of class actions were rare, settlements of class actions in 2007 reflected a continuing trend from past years, in which significant monetary payments were made in mega-class actions. Settlements in FLSA collective actions and ERISA class actions outpaced employment discrimination class action settlements in terms of overall settlement values.
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