Co-authored by Gerald L. Maatman, Jr., Laura J. Maechtlen, and Alfred L. Sanderson, Jr.

A jury in Washington state – in the case of Rekhter, et al. v. Washington Department of Social and Health Services, Case No.07-895-8 (Superior Court of Thurston County, WA) – gave workers an early holiday present in the form of a record verdict of over $57 million on December 20, 2010 [View verdict].

The 3 week trial in Rekhter involved claims of 22,000 home health care workers who sued in 2007. The backdrop to the case focused on cuts to benefits for in-home health care based on the “shared living rule” repealed by the WDSHS in 2007 after an unrelated state court ruling. Shared living is when the care provider lives in the home with the client. Plaintiffs contended that the WDSHS should have known that its “shared living rule” was subject to legal challenge in light of a Medicaid primer published by the federal government in 2000, which provided that all Medicaid beneficiaries should be treated equitably regardless of who provided the care. The WDSHS argued at trial that the 2000 Medicaid primer directed that Medicaid funds should not be used to benefit “other members of the household” and should only be used to benefit the Medicaid client; hence, the WDSHS asserted that is not appropriate to ask taxpayers to pay for everyday tasks that home care providers perform for themselves such as housekeeping, meal preparation, and shopping. Plaintiffs argued that the WDSHS in 2003 decided to cut 15 percent of the benefits usually given to in-home care recipients, who use the funds to pay the home care providers. The defense argued at trial that the plaintiff class was entitled to zero damages. Plaintiffs asked the jury for between $50 million and $90 million. The jury’s verdict clearly sided with plaintiffs in awarding $57,123,794.50.

The verdict underscores the strategy of the plaintiffs’ bar to put their wage & hour claims in state court based on favorable state law theories. Wage & hour class action litigation is growing exponentially in various “magnet” jurisdictions – such as California, Illinois, Massachusetts, New Jersey, New York, Pennsylvania, Oregon, and Washington – where liberal class certification standards and plaintiff-friendly wage & hour laws provide employees with a favorable playing field in this type of litigation. As success typically spawns copy-cats, the verdict is likely to fuel the attraction of skilled class action litigators to the already lucrative area of wage & hour litigation.