Supreme Court Upholds “No Injury” and “Trial By Formula” Class Action
I. Whether differences among individual class members may be ignored and a class action certified under Federal Rule of Civil Procedure 23(b)(3), or a collective action certified under the Fair Labor Standards Act, where liability and damages will be determined with statistical techniques that presume all class members are identical to the average observed in a sample.
II. Whether a class action may be certified or maintained under Rule 23(b)(3), or a collective action certified or maintained under the Fair Labor Standards Act, when the class contains hundreds of members who were not injured and have no legal right to any damages.
The Chamber filed an amicus brief at the merits stage urging the U.S. Supreme Court to reject the certification of a class action based on a statistical model that elided differences within the class and swept in as class members individuals who suffered no injury at all. The brief explained that such a class action not only violates Rule 23 and the Supreme Court’s recent precedents interpreting the Rule, but also ignores core constitutional principles of Article III standing and Due Process.
The Chamber filed this brief jointly with the Business Roundtable, Retail Litigation Center, Inc., and National Federation of Independent Small Business Legal Center.
The Chamber also filed a coalition brief at the cert. stage, where it explained that the courts below acknowledged some members of the putative class suffered no injury, but allowed the action to proceed based on a formula that averaged the amount of time spent by a sample of employees on pre- and post-shift tasks and applied this average to the entire class. The brief described how this approach conflicts with the Court’s recent class action cases, including Comcast Corp. v. Behrend and Wal-Mart Stores, Inc. v. Dukes, and emphasized the importance of resolving the conflict.
The Supreme Court issued a decision by 6-2 vote affirming the lower court’s decision to certify a class alleging Tyson Foods had violated the Fair Labor Standards Act (“FLSA”) by failing to compensate employees for time spent donning and doffing protective gear and walking to and from their work stations.