JENNIFER L. THURSTON, Magistrate Judge.
Plaintiffs Candace Casida and Lizette Galvan ("Plaintiffs") seek class certification pursuant to Rule 23 of the Federal Rules of Civil Procedure in its suit against Defendant Sears Holdings Corporation, Sears, Roebuck & Co. ("Defendants"). (Docs. 131, 128). Plaintiffs are former Assistant Managers of Sears who were employed in Sears' full-line retail stores. (Doc. 131 at 6). Plaintiffs contend that Sears misclassified its Assistant Managers as exempt employees, thereby depriving them of overtime. (Doc. 131). Plaintiffs seek to represent a class of former and current Assistant Managers for Sears. (Doc. 131 at 19). For their part, Defendants dispute that Plaintiffs have demonstrated the Fed. R. Civ. 23 requirements but focus their attack on their claim that individual questions predominate such that a class action is not the superior method of adjudicating Plaintiffs' claims.
The Court has read and considered the pleadings and supporting documents, and heard oral arguments by counsel on August 3, 2012. For the reasons set forth below, the Court recommends Plaintiffs' motion for class certification be
Plaintiff Casida filed her initial Complaint in the Northern District of Illinois on March 28, 2011. (Doc. 1). Plaintiff filed the Complaint as a collective and class action in which she alleged violations of the Fair Labor Standards Act (FLSA), 29 U.S.C. § 201, et seq., and the California Labor Code.
Plaintiff filed a Second Amended Complaint ("SAC") in this Court on December 5, 2011. (Doc. 77). The SAC removed Plaintiff's FLSA claim and added a claim for civil penalties under the California Private Attorney General Act ("PAGA"), Labor Code Section 2698, et. seq. After Defendants answered, Plaintiffs filed notice that Plaintiff Casida's case was related to a case filed by Plaintiff Galvan in the San Diego County Superior Court, then removed to the United States District Court for the Southern District of California. (Doc. 95). The notice explained that the matters were related as follows:
(Doc. 95). Plaintiff Galvan's case was later transferred from the Southern District Court to this Court. (Doc. 109).
Plaintiffs filed a motion for class certification on May 11, 2012. (Doc. 99). On June 6, 2012, Defendants filed a motion to dismiss the Galvan case, or in the alternative, to consolidate it with the Casida case. (Doc. 107). Before the motion was heard, the parties stipulated to consolidate the cases. (Doc. 109). On June 28, 2012, the Court ordered the cases consolidated.
Plaintiffs filed their consolidated class action complaint on June 29, 2012. (Doc. 130). Aside from references to Plaintiff "Galvan," the consolidated complaint is identical to Casida's second amended complaint. (Doc. 130). Defendants filed their Answer on July 18, 2012.
In support of the motion for class certification, Plaintiffs submitted 12 declarations of proposed class members. (Docs. 101, 103). On June 22, 2012, Defendants filed their Opposition to the motion (Docs. 110-114), to which Plaintiffs filed a reply on July 20, 2012 (Docs. 135-139). Defendants submitted 48 declarations of its employees and/or experts, in support of its Opposition. (Doc. 113).
Defendants request that the Court take judicial notice of a California Division of Labor Standards Enforcement's ("DLSE") July 6, 1993 Opinion Letter. (Doc. 112).
A court may take judicial notice of a fact "not subject to reasonable dispute in that it is either (1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned." Fed.R.Evid. 201. The content of records and reports of administrative bodies are proper subjects for judicial notice under Rule 201(d). (See
Plaintiffs and Defendants object to evidence submitted by their opponents. (Doc. 111; Doc. 138). Defendants request also the Court strike the evidence to which they have objected. (Doc. 111). However, in conjunction with a Rule 23 class certification motion, the Court may consider all material evidence submitted by the parties to determine Rule 23 requirements are satisfied.
Defendants assert the following "common objections" to Plaintiffs' declarations of proposed class members and to the declaration of Candace Casida: 1) lack of foundation/speculation; 2) vague and ambiguous; 3) relevance; and 4) "best evidence." Defendants' objections cite to an entire paragraph (Doc. 111 at 6-11) or quote multiple sentences of a paragraph (highlighting the objectionable sentence(s) in bold type) and then list two to three objections to the highlighted portions. (Doc. 111 at 13-19, 25, 27, 29-30, 32). For example, one column in Defendants' table quotes seven sentences from the Baldwin declaration, highlights three of those sentences as objectionable, and lists three objections in the adjacent column without any indication about which objections apply to which highlighted sentences. (Doc. 111 at 13). In doing so, Defendants expect the Court to speculate about which of the listed objections correspond to each of the highlighted sentences. "It is not the Court's role to divine Defendant's arguments."
Defendants incorrectly assume that the Court is required to sift through the multiple sentences and determine which objections Defendants might have intended to apply to which sentence. (Doc. 111 at 13-19, 25, 27, 29-30, 32). Even where Defendants only list a single sentence, it is unclear to which phrase or portion of the sentence they object or why. Because Defendants failed to specify which objections correspond with which objectionable portion(s) of the sentence(s), Defendants have waived the objections to Plaintiffs' evidence that were presented in the manner described above. Even if the Court excluded some portion of the declarations submitted by Plaintiffs, the Court is satisfied it would have no bearing on the outcome of Plaintiffs' motion for class certification.
Defendants seek to strike the declaration of Norma Gonzalez because she failed to appear for her noticed deposition on June 5, 2012. (Doc. 111 at 12). The Court reporter's Declaration re Failure of Norma Gonzalez to appear for her deposition indicates that counsel for Plaintiffs agreed to accept service of the deposition subpoena on Ms. Gonzalez' behalf, that service was accomplished, but Ms. Gonzalez failed to appear. (Doc. 114-16 at 3-4). Plaintiffs acknowledge that Ms. Gonzalez failed to appear, but assert her declaration should not be stricken because it was signed under penalty of perjury and her non-appearance does not affect the facts set forth in her declaration. (Doc. 139 at 44-45). "Striking a witness' direct testimony is an `extreme sanction,' one that should only be employed by a court after a party has demonstrated that [it] has taken adequate steps to protect [its] own rights."
Here, Defendants did not take steps to protect their position after Gonzalez failed to appear for her June deposition. Rather than bring a motion to compel, Defendants chose instead to raise the issue at this juncture. "It is not the province of this Court to ensure that parties protect their own rights." (See
Defendants assert nearly 100 objections to portions of each of the declarations submitted by Plaintiffs on the basis that the cited statements contradict the declarants' deposition testimony. (Doc. 111 at 11-12, 16-35) (citing
Here, Defendants took each of the depositions after the declarations had already been signed.
Plaintiffs object generically to the declarations of Sears' managers on the grounds that they lack foundation, personal knowledge, are based on hearsay and are irrelevant. (Doc. 138 at 3-4). With the exception of five citations to specific testimony, Plaintiffs list the names of all declarants to whom they intend their objections to apply. (See Doc. 138 at 3 and fn. 1). As the Court explained above, Plaintiffs' failure to identify a specific objection waives such objections.
With regard to the specific objections cited by Plaintiffs, the Court finds as follows:
Plaintiffs object to each of these declarations on the basis that Funai admits she did not directly supervise Baldwin and King admits that she did not directly supervise Gillespie. (Doc. 138 at 3). Defendants assert that the declarations of Funai and King are sufficient because they merely testify to whether the experiences set forth in the declarations of Baldwin or Gillespie, reflect the experiences of other ASMs in the managers' respective stores. Because declarants Funai and King are only testifying as to what they perceive to occur in their stores, they need not personally know declarants Baldwin or Gillespie to establish foundation for their testimony. As such, Plaintiffs objections are overruled.
Plaintiffs object to the declarations of Lawson and Adams because the managers testify about how the ASM spent his/her time, but either do not indicate how often they observed the ASM or only indicate that they spent a limited amount of time in the store. Plaintiffs object to Cooper's declaration because he characterizes the ASM as weak, but states he relied on the ASM's hiring/firing recommendations. The Court finds that each of these objections goes to the weight of the evidence and not the admissibility of the statements and on this basis, overrules Plaintiffs' objections.
Plaintiffs ask the Court to "reject" the declaration of Robert Crandall ("Crandall") for two primary reasons: 1) there is no evidence that the sample used in Crandall's report is representative of the current class of California ASMs and 2) the report lacks foundation because Crandall does not explain how he determined certain tasks to be "managerial" versus "non-managerial." (Doc. 138 at 4-6). Defendants assert that Crandall's report need not be limited to California ASMs to be relevant and that any such variation would go to the weight of the evidence, not its admissibility. (Doc. at 141 at 6).
Plaintiffs' argument that the Crandall report needs to limit itself to California ASMs to be relevant flies in the face of their overall argument that Defendants' utilize numerous standardized corporate procedures to make the duties of an ASM similar in every store and every department within a store. The policies Plaintiffs rely upon to support their motion for class certification and the Rule 30(b) depositions cited by Plaintiffs demonstrate that Defendants' policies are established nationally and set expectations for Defendants' employees nationwide, not just in California. As a result, the Court will not exclude Crandall's report as irrelevant.
Additionally, Crandall's report sets forth his methodology, the controls used in the study and his conclusions (Doc. 113-3 at Exh. 11). Crandall explains that the observers utilized a task list of approximately 583 unique tasks that were pre-loaded on the work study software devices used to capture the data for the study. (Doc. 113-3 at 25-27). These tasks were then divided into 14 broad categories: computer/office work, associate related, merchandise related, monitor/travel, manager related, phone/walkie, customer related, cashiering, safety, security, other ASM tasks, interview/hiring, cleaning vendor related, and other. (Doc. 113-3 at 10). Crandall's report notes that many of the categories contained both managerial and non-managerial tasks. (
Plaintiffs have not provided expert testimony to call into question or undermine the reliability of Crandall's study. Because bare assertions of unreliability and bias are insufficient, there is no basis for this Court to call into question the Crandall's study as it relates to the methods used to gather the data and the calculations demonstrating how the sample ASMs allocated their time among the 14 categories.
However, the Court finds that Crandall's failure to explain which tasks he characterized as "managerial" translates into a failure to explain his conclusions regarding the percentage of time spent on managerial versus non-managerial tasks. The Court's gatekeeper function requires it to conduct "a preliminary assessment of whether the reasoning or methodology underlying the testimony is scientifically valid and of whether that reasoning or methodology properly can be applied to the facts in issue."
Plaintiffs ask this Court to reject the declarations from Defendants' current employees because such declarations are inherently suspect. (Doc. 138 at 6-7). The Court notes that the ASM declarations submitted by Defendants are signed under penalty of perjury and each declarant admits awareness that the Plaintiffs are current and former employees of Sears and that the attorney assisting with the declaration represents Sears, and reports that the statement is made voluntarily. Plaintiffs have not provided any evidence to the contrary. The Court finds that this current factual situation is distinguishable from the cases cited by Plaintiffs. In both
Class certification is governed by the Federal Rules of Civil Procedure, which provide: "One or more members of a class may sue or be sued as representative parties on behalf of all." Fed. R. Civ. P. 23(a). A class action is proper if:
Fed. R. Civ. P. 23(a). Generally, these prerequisites are referred to as numerosity, commonality, typicality, and adequacy of representation, and "effectively limit the class claims to those fairly encompassed by the named plaintiff's claims."
If an action meets the prerequisites of Rule 23(a), the party seeking class certification must show the action is appropriate under Rule 23(b).
Class certification under Rule 23(b)(3) is maintainable under Rule 23(b)(3) where "questions of law or fact common to the members of the class predominate over any questions affecting only individual members," and where "a class action is superior to other available methods for fair and efficient adjudication of the controversy." Fed. R. Civ. P. 23(b)(3). Where the issues of a case "require the separate adjudication of each class member's individual claim or defense, a Rule 23(b)(3) action would be inappropriate."
Parties seeking class certification bear the burden of demonstrating that each element of Rule 23 is satisfied, and "must affirmatively demonstrate . . . compliance with the Rule."
Under California's Labor Code, all employees must receive overtime compensation may bring civil actions for the recovery of unpaid compensation. Cal. Lab.Code §§ 510, 1194. However, California law also provides an exemption from overtime pay for "executive" employees who meet six criteria. To qualify as executive-exempt, an employee must: (1) manage the enterprise, a customarily recognized department, or subdivision thereof; (2) direct the work of two or more other employees; (3) have the authority to hire or fire, or have their recommendations to hire, fire, or promote given weight; (4) exercise discretion and independent judgment; (5) be "primarily engaged" in exempt duties; and (6) earn a monthly salary equal to twice the state minimum wage for full-time employment. Cal. Code Regs. tit. 8, § 11070(1)(A)(1)(a)-(f).
While California law requires the employer to bear the burden to demonstrate that an employee is exempt from the Labor Code's overtime requirements, a plaintiff attempting to maintain a class action by challenging the overtime exemption must have common evidence to support a legal theory of misclassification.
The Court must conduct a "rigorous analysis," which may require the Court "to probe behind the pleadings before coming to rest on the certification question."
Plaintiffs assert that they have set forth sufficient evidence to meet the requirements of Rule 23(a) and that class certification is appropriate under Rule 23(b)(3). (Doc. 131 at 18-28). Specifically, Plaintiffs contend that numerosity is satisfied because Sears has provided them with over 800 proposed class member identification numbers. (Doc. 131 at 20). Plaintiffs likewise believe they have met the commonality requirement through their general allegation that Sears misclassified all assistant managers in California as exempt and through the detailed common factual and legal questions set forth in their points and authorities. (Doc. 131 at 21-23). Plaintiffs further contend that the claims that they spent more than 50% of their time performing non-exempt test are typical of those suffered by the class. (Doc. 131 at 23). Additionally, Plaintiffs contend they fairly and adequately represent the interests of the class because they have no conflicts with the proposed class members and their counsel has significant experience handling class actions like Plaintiffs. (Doc. 131 at 23-24).
Defendants' Opposition contests Plaintiffs' ability to satisfy the class certification requirements under Rule 23(a)(2), 23(a)(3), 23(b)(3) and 23(c)(4). (Doc. 110 at 24-45). Specifically, Defendants assert that Plaintiffs' alleged common issues of fact and law are either irrelevant, do not properly support class certification, or are not dispositive of the overall exemption issue. (Doc. 110 at 26-29). Defendants also contend that Plaintiffs cannot establish commonality because the individualized analysis required by the executive exception demonstrates sufficient conflicting evidence to defeat commonality. (Doc. 110 at 29-34). Defendants further argue that Plaintiff Casida's claims are not typical of the claims of the other proposed class members because Casida failed to meet Defendants` employment expectations. (Doc. 110 at 39-41). Defendants assert that as a result, Plaintiff Casida will be vulnerable to unique defenses that would not be available against other proposed class members who did meet Defendants' expectations. (Doc. 110 at 39-41). Defendants also argue that Plaintiffs' motion should be denied outright, as they seek certification of a class that is different from the class proposed in the operative pleading. (Doc. 110 at 25).
Plaintiffs further seeks certification under Rule 23(b)(3). (Doc. 131 at 24-29). Plaintiffs allege that despite the exemption analysis, common issues predominate where, as here, Defendants have applied a uniform exemption policy to all assistant managers, have subjected such employees to uniform policies which limit their discretion and shift non-exempt work to them, and where the employees perform similar duties. (Doc. 131 at 24-25). Plaintiffs argue that class treatment of misclassification cases is generally superior because it allows for a more cost-efficient and fair litigation than resolving each class member's claim individually. (Doc. 131 at 28).
With regard to Rule 23(b), Defendants dispute that common issues of fact or law would predominate over the individual issues regarding how the proposed class members actually spent their time. (Doc. 110 at 35-39). For similar reasons, Defendants argue that a class action is not superior to other means of adjudication. (Doc. 110 at 41).
Alternatively, Plaintiffs argue that class certification is appropriate under Rule 23(c)(4). (Doc. 131 at 29). Defendants assert that Plaintiffs have not identified an issue that warrants certification under Rule 23(c)(4). (Doc. 110 at 44-45).
According to the evidence produced by the parties, there are approximately 79 full-retail stores in California. (Doc. 131 at 8 citing Doc. 126-10 at 4). Each of those stores, regardless of size and location contains at least one Softlines Assistant Manager (SL) who is responsible for clothing, jewelry, footwear, and home furnishings. In other areas of the store, the specific title given the assistant manager varies depending on the size and/or type of the store. (Doc. 126-4 at 18). For example, a Brand Central ("BC") Assistant Manager is generally responsible for electronics and home appliances. However, if the store's volume is large enough, the responsibilities for home appliances may be assigned to a Home Improvement Assistant Manager ("HI"). For very small stores, Defendants utilize a Hardlines Assistant Manager ("HL") who undertakes all the duties of a BC ASM and an HI ASM. (Doc. 126-4 at 55).
Plaintiffs move to certify the following class:
(Doc. 131 at 19).
Defendants argue that the Court should dismiss Plaintiffs' entire motion, as Plaintiffs impermissibly seeks to certify a class different from that set forth in their complaints. (Doc. 1 at 5, Doc. 77 at 5, Doc. 130 at 6, Doc. 131 at 19, Doc. 131 at fn.1). The Third Amended Complaint describes the class Plaintiffs seek to certify as, "[a]ll current and former Assistant Managers employed by Sears in Sears' full-line retail stores in the State of California since March 28, 2007." Plaintiffs note they no longer wish to exclude Operations Assistant Managers and Loss Prevention Assistant Managers in the proposed class under consideration. (Doc. 131 at fn 1; Doc. 131 at 19).
Defendants argue that Plaintiffs are bound to the class definition in their pleadings and absent an order granting leave to amend, the Court should not consider the class now proposed by Plaintiffs. (Doc. 110 at 25). Defendants cite
Plaintiffs cite
A class must be "so numerous that joinder of all members is impracticable." Fed. R. Civ. P. 23(a)(1). This requires the Court to consider "specific facts of each case and imposes no absolute limitations."
Plaintiffs contend their claims meet the numerosity requirement because "Sears has employed hundreds of class members in its full-line retail stores in California." (Doc. 131 at 20 (citing Doc. 126 at 6). Specifically, Plaintiffs state that on or about February 10, 2012, Defendants provided Plaintiffs with a list of proposed class members that contained over 800 employee ID numbers. (Doc. 126 at 6). Defendants do not dispute the numerosity element. Given the number of prospective class members, the Court concludes that Plaintiffs have satisfied the numerosity requirement.
Rule 23(a) requires "questions of law or fact common to the class." Fed. R. Civ. P. 23(a)(2). The commonality requirement has been construed permissively; not all questions of law and fact need to be common.
Plaintiffs assert that the overriding questions of whether Sears properly classified ASMs under its blanket exemption policy and whether the duties performed by Assistant Managers constitute exempt work, are sufficient to satisfy commonality. (Doc. 131 at 22). Toward this end, Plaintiffs identify the following common questions which they contend will "drive the ligation":
(Doc. 99-1 at 21-22).
Plaintiffs note that similar questions satisfied the commonality requirement in
Defendants contend that Plaintiffs have not met the commonality threshold required by
Here, Plaintiffs seek class certification based upon a corporate blanket exemption policy. Plaintiffs have sufficiently pled the common questions of law or fact set forth above, similar to ones raised in other misclassification cases. In doing so, they have alleged uniform employment practices (including the scheduling program, weekly business walks, the job descriptions, the implementation of merchandising strategies, interview protocols, etc). Accordingly, the Court finds that Plaintiffs have satisfied the commonality requirement.
The typicality requirement demands the "claims or defenses of the representative parties are typical of the claims or defenses of the class." Fed. R. Civ. P. 23(a)(3). A claim or defense is not required to be identical, but rather "reasonably co-extensive" with those of the absent class members.
Defendants argue that Plaintiff Casida's claims are not typical of the claims of the other proposed class members because Casida failed to meet Defendants' employment expectations. (Doc. 110 at 39-41). Defendants claim that Casida's claims are vulnerable to unique defenses that would not be available against other proposed class members who did meet Defendants' expectations. (Doc. 110 at 39-41). Courts have found that,
Defendants contend also that the individualized nature of Plaintiffs' claims weighs against a finding that the representative plaintiffs' claims are typical of the class. (Doc. 110 at 39-41). Defendants rely on the declarations of Plaintiff Galvan and other assistant managers to demonstrate that proposed class members spent their time differently and exercised discretion differently. (Doc. 110 at 39-41). However, Defendants completely ignore that they do not dispute, for example, that they employed a blanket exemption policy for assistant managers regardless of how they actually spent their time and regardless of whether they were diligent or problematic employees. Thus, their argument, once again, seems to relate more to the predominance element, rather than whether Plaintiffs' asserted injury is typical of the class of employees who were subject to the blanket exemption policy. Thus, Plaintiffs' contention that they were misclassified and therefore denied overtime pay is typical of the class of assistant managers who Defendants allegedly misclassified. (See
Absentee class members must be adequately represented for judgment to be binding upon them.
Plaintiffs contend they have no conflicts with the putative class members concerning the issues which are the subject of the litigation. (Doc. 131 at 23-24). Plaintiffs assert they have "expended significant time and resources to the litigation by responding to document requests, searching for and producing hundreds of documents, meeting with counsel and sitting for a deposition." In addition, Plaintiffs allege that they have retained competent counsel with experience in prosecuting complex employment class actions. (Doc. 131 at 24 (citing Doc. 126-34).
Based upon the declarations of Plaintiffs, Plaintiffs have demonstrated they are adequate representatives for the putative class members. Review of the declarations of counsel likewise demonstrates they are experienced wage and hour attorneys with class action experience. (Doc. 126-34). The Court therefore finds that Plaintiffs can fairly and adequately protect the interests of the proposed class. Defendants offer no argument to the contrary.
Plaintiffs contend this class action meets the requirements of Rule 23(b)(3) because common questions predominate over individual questions in this action and, therefore, class treatment is superior to other available methods of litigation. (Doc. 131 at 24-28).
Federal Rule of Civil Procedure 23(b)(3) requires a finding that (1) "the questions of law or fact common to class members predominate over any questions affecting only individual members," and (2) "a class action is superior to other available methods for fairly and efficiently adjudicating the controversy." These requirements are generally called the "predominance" and "superiority" requirements. See
The predominance requirement is "far more demanding" than the commonality requirement of Rule 23(a).
To show predominance, Plaintiffs must provide common proof of misclassification that would obviate the need for individualized inquiries.
Given that the parties have identified both common and individual issues, the Court analyzes the evidence supporting both issues and the relationship between the two below.
Plaintiffs argue that Defendants' policy to classify all ASMs as exempt, is proof of a common issue. (Doc. 131 at 16-18 and 25.) However, Plaintiffs acknowledge that the Ninth Circuit has found that reliance on such uniform classification by an employer to the near exclusion of other factors is an abuse of discretion. (Doc. 131 at 25); see also
Plaintiffs argue also that Defendants' "company-wide policies and practices" constitute evidence susceptible to common proof of misclassification. (Doc. 131 at 25). First, Plaintiffs cite to Plaintiffs' "uniform policy and practice of setting and restricting labor budgets to maintain minimum hourly staff" as common proof of misclassification. (Doc. 131 at 25). Plaintiffs argue this necessarily requires ASMs to work extended hours on non-exempt tasks (i.e. tasks that would be performed by non-exempt associates and leads had the program allowed for additional hours). (Doc. 131 at 11-13 and 25-26). As common proof that ASMs were not authorized to extend associates`/leads' hours beyond those allotted by the scheduling program, Plaintiffs rely on the Associate Handbook (Doc. 126-21 at 3), an e-mail restricting the use of overtime (Doc. 126-23 at 2), and Defendants` expectations that stores will use 98% to 101% of budgeted labor amount (Doc. 126-6 at 11).
Second, Plaintiffs cite to the ASM job descriptions, hiring protocols, and merchandising standards established by Defendants as common proof of misclassification. Plaintiffs note: 1) the ASM job description requires ASMs (SL, BC, and HI) to spend 95% of their time on the sales floor
Both parties submit declarations from proposed class members regarding their individual experiences as ASMs, including the discretionary decisions they made or didn`t make, and how each spent their time. (Doc. 103 and 114). Plaintiffs contend ASMs spent the majority of their time completing non-exempt tasks that their associates/leads could not complete and state that they did not have discretion in performing other duties such as setting up the floor, interviewing, disciplining, and scheduling employees for work. The declarations of ASMs provided by Defendants, assert the contrary.
In addition, Defendants supplied declarations from Store Managers (SMs) and District Managers who describe their expectations of their ASMs, what they observed about how their ASMs spent their time, and some of the strengths and weakness certain proposed class members exhibited during their employment. (Doc. 114). Plaintiffs argue that their work on the sales floor in assisting customers, and setting up the floor, as non-exempt based upon the lack of discretion vested in them to decide how to do this work. For their part, Defendants describe similar work as part of their duty to train, supervise, and oversee their associates as they saw fit, based upon the discretion they were entitled to exercise. (Doc. 103 and 114).
Although the Court does not weigh the evidence, it does "compar[e] the class claims, the type of evidence necessary to support a class-wide finding on those claims, and the bearing of those considerations on Rule 23 certification."
"Common questions may predominate where the resolution of a question common to the class would significantly advance the litigation."
Here, the evidence shows that the tasks completed by ASMs are common to all ASMs. Also, there is company-wide standardization in scheduling associates, interviewing potential employees, and implementation of Store Planners.
Though the existence and capabilities of the scheduling programs is susceptible to common proof (Doc. 149 at 8-26; Doc. 125-6 at 11-28), alone this would not demonstrate that the ASMs were misclassified. To do this, Plaintiffs would need to provide common proof of the lack of authority—by anyone in the local store—to extend hours beyond that allocated by the program and common proof that the additional hours worked by the ASM's due to this staffing shortage, were spent on non-exempt tasks. Though Plaintiffs have provided common proof that the ASMs did not have the authority to schedule associates for hours beyond that which the program dictated, the evidence is uncontradicted that Store Managers could do so. Notably, the Associate Handbook, which requires "associates to obtain prior management approval before working overtime," does not speak to whether associates could not work more hours that the program allowed. (Doc. 126-21 at 3). On the other hand, aside from foundational and hearsay issues, the December 7, 2010 e-mail taken on its face, may be susceptible to common proof only that leads and associates were not supposed to be scheduled for more hours than allotted by the program, unless the ASM provided sufficient justification. (Doc. 126-23 at 2). Again, it does not demonstrate that more hours could not be sought. Coplan's expectation, that his stores use 98% to 101% of budgeted labor, is susceptible to common proof that the ASMs, generally, were supposed with work within the hours allotted by the scheduling program. (Doc. 126-6 at 11). However, even still, Plaintiffs provide scant evidence that this supports the conclusion that ASMs primarily spent their time on finishing the non-exempt tasks that should have been completed by associates. (Doc. 131 at 10 and 12). Rather, spending time doing non-exempt tasks may be explained by a number of factors including the varying capabilities and management competencies of the various ASMs, the differences in store size, location or amenities. Indeed, Defendants directly counter Casida's declaration on this point by demonstrating that the ASM hired to replace her, Claudia Quinones (Doc. 113-7 at 36-56), did not work more than 50% of her time on non-exempt tasks despite that she worked in the same identical store, for the same identical Store Manager using the same identical staff. In
The court found similarly in
Again in
The court held, "It is true that a company-wide policy can answer the need for class-wide method of proof
Finally, Plaintiffs rely heavily on
In evaluating the conflicting evidence regarding these tasks, it appears that some ASMs— notably those submitting declarations in support of Plaintiffs' motion—were subject to policies that removed a significant amount of discretion—if not all discretion—from them. On the other hand, this is markedly different from the experience outlined in the numerous declarations submitted by Defendants. (Docs. 113-1, -2, -4, -5, -6, -7, -8, -9) These declarations deny the centralized policies constrained their discretion. (See e.g., Doc. 113-8 at 22 ["`All-in-One Staffing Report' . . . gives us general guidance . . . but I do deviate from these guidelines." . . . "I have authority to discipline and terminate associates."]; Doc. 113-8 at 35 "[W]hile meeting forecasted payroll hours is a goal, I have never experienced any negative consequences as a result of my departments going over their forecasted payroll hours."]; Doc. 113-8 at 37 [" . . . I am responsible for hiring in my department . . . I rely on a lead associate to do an initial interview and screening."]; Doc. 113-8 at 48 [". . . I have authority to hire associates . . ."]; Doc. 113-8 at 48-49 ["When I feel that I need to schedule additional hours to complete the work in my departments, I simply add the extra payroll hours and then let my Store Manager know."]; Doc. 113-8 at 52 [As to the store's merchandising, "I am free to deviate from the Company's general guidance to achieve this goal."]; Doc. 113-9 at 6 ["I deviate from Sears's general floor plans in the women's apparel department."]; Doc. 113-9 at 7 ["I do not need permission to discipline my associates."]; Doc. 113-9 at 59 ["I receive general guidance about how to set up the departments from the Company . . . I can and do revise floor plans based on my own judgment."]; Doc. 113-9 at 61 ["Although Sears uses a program for scheduling, I often need to alter what the system populates and manually add hours as needed for certain tasks and make adjustments."]; Doc. 113-9 at 62 [deviates from script when interviewing prospective employees.] In any event, the Court notes that the
Likewise
Finally,
Emphasis added. In addition, though there was some slight variation in the "scope and scale" of the tasks completed by the store managers, each performed the same tasks at each store.
The policies are issue here do not tell the Court with any specificity how AMs actually spend their time. Indeed, Defendants counter with evidence that the amount of time spent on non-exempt tasks by ASMs, varies widely. (
Though, the common policies provided by Plaintiffs here instruct them in how to perform certain tasks, they do not tell Plaintiffs how to balance their responsibilities and do not direct them to perform the tasks reserved for their associates and leads.
The superiority inquiry requires a determination of "whether objectives of the particular class action procedure will be achieved in the particular case."
On the other hand, Plaintiffs argue that even if individual questions predominate, the Court should certify common issues and under Fed. R. Civ. P. 23(c)(4)(A) and apply class treatment to them. Under Rule 23(c)(4), "an action may be brought or maintained as a class action with respect to particular issues" only, if appropriate. Fed.R.Civ.P. 23(c)(4). Thus "[e]ven if the common questions do not predominate over the individual questions so that class certification of the entire action is warranted, Rule 23 authorizes the district court in appropriate cases to isolate the common issues under Rule 23(c)(4)(A) and proceed with class treatment of these particular issues."
Plaintiff spends little effort on this topic and argues only that the common issues include all of the common questions outlined above. However, clearly, these "common issues," for the most part would require individual evidence. Whether Sears properly classified its ASMs as exempt would require a determination as to each ASM whether he/she spent more than 50% of the work time on non-exempt tasks, for example. Even the question of whether the tasks required by the job description were non-exempt due to Defendants' centralized standardization, would require individualized evidence because it appears that the amount of discretion an ASM has varies from store-to-store. On the other hand, only questions number 2
Individualized questions are essential to liability here because whether the exempt classification was properly imposed depends on the duties actually performed by each ASM, how they were performed and how much time was spent on the task. At oral argument, Plaintiffs' counsel agreed that at its core, this litigation questions whether Defendants' centralized programs removed discretion from the ASMs such that when performing indisputably managerial-type tasks this work was, nevertheless, non-exempt. However, the evidence on this topic varies widely. Defendants present numerous declarations from ASMs which indicate that the corporate programs did not remove discretion in performing these tasks. Most notably, Plaintiffs fail to address the declaration of Claudia Quinones, the ASM hired to replace her, who describes a strikingly different employment experience despite that they worked in the same store, for the same manager with the same employees and under the same centralized policies. (Doc. 113-7 at 36-56). Moreover, the evidence shows that whether a task is exempt may depend on many factors such as the amount of discretion vested in the ASM actually permitted in performing the task and whether the ASM performed the task along with hourly associates for training purposes. Given the numerous individualized inquiries, the Court finds that a class action would be impractical and unmanageable and would not promote judicial economy. Thus, the Court concludes that proceeding as a class is not the superior method.
As set forth above, Plaintiffs have failed to demonstrate the requirements for certification under Rule 23(b)(3). Accordingly,
These findings and recommendations are submitted to the United States District Judge assigned to the case, pursuant to the provisions of 28 U.S.C. § 636(b)(1)(B) and Rule 304 of the Local Rules of Practice for the United States District Court, Eastern District of California. Within fourteen days after being served with these findings and recommendations, any party may file and serve written objections with the Court. A document containing objections should be captioned "Objections to Magistrate Judge's Findings and Recommendations." Any reply to the Objections shall be filed and served within fourteen days of the date of service of the objections.
